THIS AGREEMENT is made on 24 April 1998 between:
(1) OCWEN LIMITED, a company incorporated under the laws of England and
Wales, registered number 3542994 whose registered office is at 00
Xxxxxxxxxxx Xxxxx, Xxxxxx XX0X 0XX (the "BORROWER"); and
(2) GREENWICH INTERNATIONAL, LTD. a company incorporated under the laws of
Bermuda, whose branch office in the United Kingdom is at 0 Xxxxxx
Xxxxxx, 0xx Xxxxx, Xxxxxx (the "LENDER"); and
(3) OCWEN FINANCIAL CORPORATION, a company incorporated in the State of
Florida, USA and whose principal place of business is at The Forum,
0000 Xxxx Xxxxx Xxxxx Xxxxxxxxx, Xxxx Xxxx Xxxxx, Xxxxxxx 00000 ("OFC"
or the "Guarantor")
WHEREAS:
(1) City Mortgage Corporation Limited ("CMC"), Mortgage Management Limited
("MML"), a wholly owned subsidiary of CMC and the Lender have entered
into, inter alia, a Loan Facility Agreement dated 27 February 1998
pursuant to which a loan facility was made available to MML to enable
MML to purchase mortgage loans originated by CMC and its subsidiaries
(the "MML LOAN FACILITY AGREEMENT").
(2) OFC and CMC together with other parties referred to therein have
entered into an agreement for the sale and purchase of the business of
CMC and its subsidiaries dated 31 March 1998 (the "SALE AGREEMENT")
pursuant to which OFC has agreed to buy or procure another Buyer Group
Company (as therein defined) or any OAIC Group Company (as therein
defined) to buy the assets specified therein and the entire issued
share capital of City Mortgage Receivables 7 Plc.
(3) The Borrower, CMC and the other Donors (as defined therein) have agreed
to enter into the Supplemental Sale Agreement pursuant to which
Pipeline Loans will be originated by the Borrower, as agent of CMC and
the other Donors and immediately thereafter sold by CMC (or other
Donors) to the Borrower as principal.
(4) The Lender has agreed to provide a facility to the Borrower to finance
the acquisition by the Borrower of certain of the assets under the Sale
Agreement and to finance the origination by the Borrower of New
Production Mortgage Loans or the purchase of Pipeline Loans, on the
terms and subject to the conditions contained herein.
(5) OFC has agreed to indemnify the Lender in respect of inter alia, the
obligations of the Borrower under this Agreement.
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1. INTERPRETATION
1.1 DEFINITIONS
In this Agreement (including the recitals hereto) the following terms
shall have the respective meanings set forth below:
"ACCELERATION" means any acceleration of the Advances hereunder
following the occurrence of an Event of Default.
"ACCOUNT ASSIGNMENTS" means the Borrower Collection Account Assignment
and the Borrower Funding Account Assignment.
"ACCOUNT BANK" means National Westminster Bank Plc or such other bank
or financial institution as may be substituted as account bank with the
prior written consent of the Lender.
"ADVANCE" means, save as otherwise provided herein, an advance (as from
time to time reduced by repayment and prepayment) made or to be made by
the Lender hereunder pursuant to the Term Loan or the Revolving
Commitment.
"ADVANCE DATE" means each date on which the Lender from time to time
shall make Advances to fund the origination or purchase of Mortgage
Loans hereunder.
"ADVANCE DATE PRINCIPAL BALANCE" means as to any Mortgage Loan, the
unpaid principal balance thereof as of the related Advance Date (or, if
later, the date of origination of such Mortgage Loan) provided that
(unless otherwise agreed between the Lender and the Borrower) such
unpaid principal balance shall be calculated after application of all
payments of principal due and received on or prior thereto, but without
giving effect to any instalments of principal received in respect of
due dates thereafter.
"ADVANCE PERCENTAGE" in respect of any Mortgage Loan to be funded
pursuant to a Revolving Advance hereunder means the lesser of (a) the
Market Value Percentage for such Mortgage Loan and (b) (i) 100% in the
case of Performing Senior Mortgage Loans, and (ii) 95% in the case of
Performing Junior Mortgage Loans.
"AGREED FORM UNDERTAKINGS AND DOCUMENTATION LETTERS" means the letters
of even date from the Lender, addressed respectively to (i) the
Borrower, Tomlinsons and Xxxxxxx Xxxxxxxx Xxxxxxx & Co. and (ii) the
Borrower and Xxxxxx XxXxxxxxx Green, with agreed form documentation
attached, in each case signed by way of acknowledgement and acceptance
by the relevant solicitors and the Borrower.
"AGREEMENT" means this Loan Facility Agreement, including all schedules
and annexures hereto, which expression shall include the same as
varied, supplemented, re-stated, extended or replaced from time to
time.
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"AVAILABLE COMMITMENT" means, at any time, the Revolving Commitment at
such time LESS the principal amount of the Revolving Loan then
outstanding.
"AVAILABILITY PERIOD" means the period commencing on the date of this
Agreement and ending on the earlier of:-
(1) the date on which the Lender ceases to be under any
obligation to make further Advances to the Borrower
hereunder pursuant to the terms hereof; and
(2) the Final Maturity Date.
"BORROWER COLLECTION ACCOUNT" means the account in the name of the
Borrower with the Account Bank number 00000000 assigned to the Lender
pursuant to the Borrower Collection Account Assignment.
"BORROWER COLLECTION ACCOUNT ASSIGNMENT" means the assignment of the
Borrower Collection Account in favour of the Lender dated on or about
the date hereof in form and substance satisfactory to the Lender.
"BORROWER FUNDING ACCOUNT" means an account in the name of the Borrower
at the Account Bank number 00000000 assigned to the Lender under the
Borrower Funding Account Assignment.
"BORROWER FUNDING ACCOUNT ASSIGNMENT" means the assignment of the
Borrower Funding Account in favour of the Lender dated on or about the
date hereof in form and substance satisfactory to the Lender.
"BORROWER WORKING CAPITAL ACCOUNT" means the account in the name of the
Borrower with the Account Bank number 00000000 charged by way of
floating charge in favour of the Lender pursuant to the Debenture.
"BORROWING BASE DEFICIENCY" means, on any day by reference to which the
same falls to be calculated, the excess (if any) of Outstanding
Advances over Collateral Value calculated and agreed in accordance with
clause 19.
"BUSINESS DAY" means a day (other than a Saturday or Sunday) on which
banks are generally open for business in London and New York.
"CCA" means the Consumer Credit Xxx 0000.
"CMC TRANSFER POWER OF ATTORNEY" means the power of attorney granted to
the Borrower and Solicitors by City Mortgage Corporation Limited and
the other Donors (as therein defined) pursuant to the Supplemental Sale
Agreement the form of which is annexed thereto ;
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"CMC COLLECTION ACCOUNT" means account number 00000000 with the Account
Bank utilized for the time being for the purpose of collection of sums
payable by Mortgagors under all Mortgage Loans originated by CMC and
J&J.
"CMC COLLECTION ACCOUNT DECLARATION OF TRUST" means the declaration of
trust dated 21 March 1996, as supplemented by all supplemental
declarations of trust relating thereto, pursuant to which trusts over
all amounts credited from time to time to the CMC Collection Account
are (prior to execution of the Novation Agreements) constituted in
favour of, inter alia, GIL, CMF, certain Issuers and the trustee under
each Securitisation Receivables Trust.
"CMF" means City Mortgage Funding 1 Limited, incorporated under the
laws of England and Wales, number 3299937, whose registered office is
at Xxxxxxxxx Xxxxx, Xxxxxxx Xxxxxxxx Xxxx, Xxxxxxx.
"CMF COLLECTION ACCOUNT" means an account in the name of CMF with the
Account Bank number 00000000.
"CMF COLLECTION ACCOUNT DECLARATION OF TRUST" means the declaration of
trust dated 30 April 1997, as supplemented by all supplemental
declarations of trust relating thereto, pursuant to which trusts over
all amounts credited from time to time to the CMF Collection Account
are (prior to execution of the Novation Agreements) constituted in
favour of, inter alia, GIL and City Mortgage Receivables 6 plc.
"COLLATERAL PERCENTAGE" in respect of any category of Mortgage Loan
means the percentage set out in the table below by reference to such
category of Mortgage Loan:-
Performing Senior Mortgage Loan 100%
Performing Junior Mortgage Loan 95%
Non Performing Senior Mortgage Loan 70%
Non Performing Junior Mortgage Loan 30%
"COLLATERAL SECURITY" has the meaning attributed to it in the
Debenture.
"COLLATERAL VALUE" means, on any Interest Payment Date by reference to
which the same falls to be determined, the aggregate of the values
attributed to each Existing Mortgage Loan, each New Production Mortgage
Loan and each Pipeline Loan financed under the Facility as at the
related Determination Date, the value to be attributed to each such
Mortgage Loan for such purpose to be determined by multiplying the
lesser of the Collateral Percentage and the Market Value Percentage for
each Mortgage Loan (on the basis of the status of such Mortgage Loan as
at the related Determination Date) by the outstanding principal amount
of each such Mortgage Loan as at the relevant Determination Date.
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"COLLECTION ACCOUNTS" means the CMC Collection Account, the GFS Master
Collection Account, the CMF Collection Account and the Greyfriars
Originator Collection Accounts.
"COLLECTION ACCOUNT NOVATION AGREEMENT" means the agreement to be
entered into on or about the date hereof between, inter alia, the
Lender, the Borrower, each Greyfriars Originator, CMC, CMF and the
Account Bank pursuant to which, inter alia, the bank account agreements
relating to the Collection Accounts are to be amended and novated.
"COLLECTION PERIOD" means the calendar month immediately prior to the
calendar month in which the relevant Interest Payment Date falls.
"CONSOLIDATED INDEBTEDNESS" means for any period, the aggregate
Indebtedness of the relevant entity determined on a consolidated basis
in accordance with GAAP less any non-specific balance sheet reserves
maintained in accordance with GAAP.
"CONSOLIDATED TANGIBLE NET WORTH" means all amounts included as capital
on the relevant entity's consolidated balance sheet determined in
accordance with GAAP less amounts owing to affiliates and less any
intangible assets including, without limitation, goodwill and deferred
tax assets.
"COUNTER INDEMNITY" means the counter indemnity to be entered into on
or about the date hereof between OFC and the Borrower in respect of the
Indemnity, in form and substance satisfactory to the Lender.
"DEBENTURE" means the debenture to be entered into on or about the date
hereof in form and substance satisfactory to the Lender by the Borrower
in favour of the Lender creating fixed and floating charges over all of
the Borrower's undertaking and assets.
"DEFERRED ASSIGNMENT OF COLLATERAL SECURITY" means the assignments of
Collateral Security by the relevant Originator, direct to the Borrower,
pursuant to the Sale Agreement in relation to Existing Mortgage Loans
originated since 27 February 1998 but in respect of which the relevant
Collateral Security has not been assigned to MML.
"DETERMINATION DATE" means the last day of each Collection Period.
"DRAWDOWN REQUEST" means the form of written request for an Advance to
be delivered by the Borrower to the Lender prior to the relevant
Advance Date, substantially in the form set out in Schedule 1 together,
where the Advance is under the Revolving Commitment, with a Solicitors
Certificate of Title and Undertaking attached thereto in relation to
each Mortgage Loan to be originated and/or each Pipeline Loan to be
acquired.
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"DUE DATE" means the due date for payment by the Mortgagor of principal
and/or interest under the terms of the relevant Mortgage Loan.
"ELIGIBLE COLLATERAL" means any Mortgage Loan which is not, at the date
on which the same is charged in favour of the Lender under clause 15.5
already subject to the Debenture and:-
(a) which has not already been financed hereunder; and
(b) which would, were it to be financed hereunder, fulfill all
required criteria including, without limitation, compliance
with all representations and warranties.
"ENGLISH MORTGAGE LOAN" means a Mortgage Loan secured over a Mortgaged
Property situated in England or Wales.
"EVENT OF DEFAULT" means any one of the conditions or circumstances
referred to in clause 17.
"EXCLUDED LOANS" means any mortgage loans acquired or originated by the
Borrower from time to time but which are not funded pursuant to this
Agreement, other than Securitised Mortgage Loans.
"EXISTING MORTGAGE LOANS" means those Mortgage Loans to be purchased by
the Borrower from, inter alia, MML pursuant to the terms of the Sale
Agreement and listed in Schedule 1 to the Debenture (which schedule
shall exclude the Excluded Loans and the Securitised Mortgage Loans).
"EXTENSION" means any renewal of the Revolving Facility, for one or
more further periods pursuant to clauses 2.8 and 2.9.
"EXTENSION PERIOD" means each period by which the Revolving Facility
may, from time to time, be extended.
"FACILITY" means the facility granted to the Borrower by the Lender
under this Agreement.
"FACILITY OFFICE" means the office of the Lender through which it makes
any Advance to the Borrower.
"FINAL MATURITY DATE" means:
(a) the day falling 180 days from the date hereof unless that day
is not a Business Day in which case the Final Maturity Date
shall be the immediately preceding day which is a Business
Day; or
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(b) in the event that there is any Extension or Extensions of the
Revolving Facility, the last Business Day of (and falling
within) the first Extension Period (if there is not more than
one Extension) or, if there is more than one Extension, the
final Extension Period.
"GFS MASTER COLLECTION ACCOUNT" means an account in the name of
Greyfriars Financial Services Limited with the Account Bank number
00000000 to which are credited all payments made by Mortgagors under
Mortgage Loans originated by any Greyfriars Originator.
"GFS MASTER COLLECTION ACCOUNT DECLARATION OF TRUST" means the
declaration of trust dated 18 October 1996 (as supplemented by all
supplemental declarations of trust relating thereto) constituting
trusts over all amounts standing to the credit of the GFS Master
Collection Account (prior to execution of the Novation Agreement) in
favour of, inter alia, GIL, CMF, certain Issuers and the trustees of
each Securitisation (prior to execution of the Novation Agreement)
Receivables Trust.
"GREYFRIARS ORIGINATOR" means each of Home Funding Corporation Limited,
Assured Funding Corporation Limited and Home Mortgage Corporation
Limited.
"GREYFRIARS ORIGINATOR COLLECTION ACCOUNTS" has the meaning attributed
thereto in the Greyfriars Originator Collection Account Declaration of
Trust.
"GREYFRIARS ORIGINATOR COLLECTION ACCOUNT DECLARATION OF TRUST" means
the declaration of trust dated 18 October 1996 (as supplemented by all
supplemental declarations of trust relating thereto) constituting
trusts (declared by, inter alia, each Greyfriars Originator) over all
amounts standing to the credit of the Greyfriars Originator Collection
Accounts in favour of (prior to execution of the Novation Agreements),
inter alia, GIL, certain Issuers and the trustees of each
Securitisation Receivables Trust.
"HOLDING COMPANY" of a company or corporation means any company or
corporation of which the first-mentioned company or corporation is a
subsidiary, and references to a company or corporation shall be deemed
to include a company or corporation which is not formed and registered
under the Companies Xxx 0000.
"INDEBTEDNESS" means any obligation (whether incurred as principal,
cautioner or surety) for the payment or repayment of money in respect
of:
(a) monies borrowed and debit balances at banks;
(b) any loan note, bond, note, loan stock, commercial paper,
debenture or other security;
(c) any acceptance or documentary credit;
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(d) the deferred purchase price of property or services, except
accounts payable and accrued expenses arising in the ordinary
course of business;
(e) any receivable sold or discounted (otherwise than on a
non-recourse basis);
(f) the capital value of any lease (whether in respect of land,
machinery, equipment or otherwise) entered into primarily as a
method of raising finance or financing the acquisition of the
asset leased;
(g) any currency or interest swap, cap, collar, floor or corridor
transaction, any repurchase or reverse repurchase transaction,
any foreign exchange, spot or forward transaction, any stock
lending transaction, any financial option, or any combination
of any of the foregoing; or
(h) without double counting, any guarantee, indemnity or
contingent liability in respect of any borrowings of any
person of a type referred to in (a) to (g) above but only to
the extent the borrowings thereby guaranteed or indemnified
against are outstanding.
"INDEMNITY" means the indemnity to be given by OFC on or about the date
hereof in form and substance satisfactory to the Lender indemnifying,
inter alia, the Lender for, inter alia, the obligations of the Borrower
under this Agreement.
"INITIAL ADVANCE" means the advance of the Term Loan.
"INTEREST PAYMENT DATE" means the 15th day of each month unless that
day is not a Business Day in which case the Interest Payment Date shall
be the immediately preceding day which is a Business Day.
"INTEREST PERIOD" means, for each Advance, each of the following
periods:
(a) the period commencing on (and including) the day the relevant
Advance is made and ending on (but excluding) the next
following Interest Payment Date; and
(b) thereafter, each period commencing on (and including) an
Interest Payment Date and ending on (but excluding) the next
following Interest Payment Date,
provided that any Interest Period which would otherwise overrun the
Final Maturity Date or the Repayment Date (of the relevant Advance)
shall end upon whichever is the earlier of the Final Maturity Date or
the relevant Repayment Date.
"INTIMATIONS OF ASSIGNATIONS OF TRUST PROPERTY" means the intimations
of the Scottish Trust Assignations, in the form set out in Schedule 5.
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"ISSUERS" means each of City Mortgage Receivables 1 Plc (Company No.
3126751), City Mortgage Receivables 2 Plc (Company No. 3245450), City
Mortgage Receivables 3 Plc (Company No. 3245445), City Mortgage
Receivables 4 Plc (Company No. 3246090), City Mortgage Receivables 5
Plc (Company No. 3304205) and City Mortgage Receivables 6 Plc (Company
No. 3328209).
"J&J" means J&J Securities Limited, a company incorporated in England
and Wales under number 1335672 whose registered office is at Xxxxxxxxx
Xxxxx, Xxxxxxx Xxxxxxxx Xxxx, Xxxxxxx, Xxxxx, XX0 0XX.
"JUNIOR MORTGAGE LOAN" means any Existing Mortgage Loan, New Production
Mortgage Loan or Pipeline Loan financed or to be financed hereunder and
which is secured other than by way of a first ranking legal mortgage or
first ranking Standard Security.
"LIBOR" in respect of a particular period and in relation to an Advance
or other amount in respect of which an interest rate is to be
determined pursuant to this Agreement, means the percentage interest
rate per annum for the time being offered in the London Interbank
Market to prime banks for one month sterling deposits at or about 11.00
a.m. (London time) on the first day of such period as published on the
relevant page of The Bloomberg (Bloomberg L.P.) under the heading
"Money Market-Money Market Rates".
"MANUALS" has the meaning attributed to it in the Servicing Agreement.
"MARGIN" means (a) 1.50% with respect to the Initial Advance under the
Term Loan and (b) with respect to all Revolving Advances under the
Revolving Facility (i) 1.50% until the Interest Payment Date
immediately following the date on which at least (pound
sterling) 200,000,000 in aggregate principal amount of the Initial
Advance has been repaid to the Lender and (ii) 0.875% for any Interest
Payment Date thereafter.
"MARKET VALUE PERCENTAGE" in respect of any Mortgage Loan on any date
of determination means the market value of such Mortgage Loan
(expressed as a percentage of the unpaid principal balance of such
Mortgage Loan) determined by the Lender in its sole discretion acting
reasonably following consultation with the Borrower, which
determination in the absence of manifest error shall be conclusive.
"MASTER NOVATION AGREEMENT" means the novation agreement to be entered
into on or about the date hereof between, inter alia, the Lender, Ocwen
Asset Investment - UK, LLC, each Issuer, CMC, CMF, each Greyfriars
Originator and CMS, pursuant to which, inter alia:-
(a) contracts relating to the Securitisations are amended and
novated or, as the case may be, amended and rights thereunder
assigned; and
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(b) trusts in favour of the Borrower over all amounts credited,
inter alia, to any Collection Account from time to time which
represent or relate to monies received or recovered from
Mortgagors under Mortgage Loans owned (whether legally or
beneficially) by the Borrower, other than Securitisation
Mortgage Loans, are constituted.
"MHA DOCUMENTATION" means in relation to any Scottish Mortgage Loan,
any affidavit, consent or renunciation granted in terms of the
Matrimonial Homes (Family Protection) (Scotland) Xxx 0000 given in
connection with such Scottish Mortgage Loan or the Mortgaged Property
secured thereunder.
"MINDED TO REVOKE NOTICE" means any notice given under section 32 of
the CCA.
"MIRAS SCHEME" means the mortgage interest relief at source scheme
specified in section 369 of the Income and Corporation Taxes Xxx 0000.
"MML" means Mortgage Management Limited;
"MML ASSIGNMENT OF COLLATERAL SECURITY" means the assignment of
Collateral Security by, inter alia, MML to the Borrower of even date
hereto pursuant to the terms of the Sale Agreement.
"MML TRANSFERS" means the transfers of even date of all Existing
Mortgage Loans executed by, inter alia, MML and CMF in favour of the
Borrower pursuant to the Sale Agreement.
"MORTGAGE DEED" means in relation to each Mortgage Loan, the deed
creating the charge by way of first or subsequent ranking legal
mortgage or first or subsequent ranking Standard Security over the
relevant Mortgaged Property, and incorporating the terms and conditions
on which the relevant advance to the Mortgagor was made.
"MORTGAGE FILE" means the Mortgage Loan Documents pertaining to a
particular Mortgage Loan, together with the related mortgage
application forms completed by the relevant Mortgagor(s), credit agency
checks, if any, carried out in respect of such Mortgagor(s),
correspondence files and all other material documents, papers and
computer records held by or for the relevant Originator in respect of
the particular Mortgage Loan.
"MORTGAGE LOAN" means the relevant loan (and, as the context admits,
all security therefor (including Collateral Security in relation
thereto) and all rights and entitlements of the relevant Originator in
relation thereto and all references to Mortgage Loan in or connection
with any representation and warranty herein shall be construed as a
reference to the Mortgage Loan, together with the related Mortgage and
all Collateral Security related thereto) made by an Originator to a
Mortgagor secured by a first or junior ranking legal mortgage or first
or junior ranking Standard Security in favour of the Originator over
the relative Mortgaged Property.
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"MORTGAGE LOAN DOCUMENTS" means the documents listed in Schedule 3
pertaining to any Mortgage Loan.
"MORTGAGE LOAN PACKAGE" means the Mortgage Loans requested to be
financed hereunder under any Drawdown Notice.
"MORTGAGE LOAN PURCHASE AGREEMENT" means the agreement dated 14 June
1996 between the Lender (1) and CMC (2) whereby the Lender agreed to
purchase and CMC agreed to sell mortgage loans originated by CMC and
its approved affiliates.
"MORTGAGE LOAN SCHEDULE" means the schedule of Mortgage Loans annexed
to each Drawdown Request.
"MONTHLY PAYMENT" means in respect of any Existing Mortgage Loan or New
Production Mortgage Loan financed hereunder the monthly payment due and
payable by the relevant Mortgagor on the relevant Monthly Payment Date.
"MORTGAGED PROPERTIES" means each and all (as the context admits)
freehold and/or leasehold properties in England or Wales mortgaged
under and/or properties held on heritable title or long lease in
Scotland secured under the relative Mortgage Deeds.
"MORTGAGE TRANSFER AGREEMENT" means the Agreement dated 27 February
1998 made between Greenwich International, Ltd., City Mortgage Funding
1 Limited, MML and the Originators.
"MORTGAGOR" means the party (or parties) referred to as such or as "THE
BORROWER"in the relevant Mortgage Deed.
"NEW PRODUCTION MORTGAGE LOANS" means Mortgage Loans originated by the
Borrower on or after the date hereof.
"NON PERFORMING JUNIOR MORTGAGE LOANS" means a Junior Mortgage Loan
which as of the last day of the related Collection Period has due and
unpaid all or any part of at least one Monthly Payment.
"NON PERFORMING SENIOR MORTGAGE LOANS" means each Existing Mortgage
Loan, New Production Mortgage Loan and Pipeline Loan financed hereunder
and which:
(a) is a Senior Mortgage Loan; and
(b) as of the last day of the related Collection Period has due
and unpaid all or any part of at least two Monthly Payments.
"NOVATION AGREEMENTS" means the Master Novation Agreement and the
Collection Account Novation Agreement.
"OFT" means the Office of Fair Trading.
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"OFT GUIDELINES" means the guidelines issued by the OFT relating to the
non-status lending market in effect from time to time.
"ORIGINATION SALE AND PURCHASE AGREEMENT" means the agreement dated 27
February 1998 made between City Mortgage Corporation Limited and others
and MML;
"ORIGINATOR" means in relation to all New Production Mortgage Loans,
the Borrower, and in relation to all Existing Mortgage Loans and
Pipeline Loans the originator of such Mortgage Loan (which, for the
avoidance of doubt, shall, in relation to Pipeline Loans, be construed
as a reference to the relevant Donor (as defined in the CMC Transfer
Power of Attorney).
"ORIGINATOR ASSIGNMENTS OF COLLATERAL SECURITY" means the assignments
of Collateral Security executed by Originators in favour of MML dated
27 February 1998 and executed pursuant to the Mortgage Transfer
Agreement;
"ORIGINATOR ASSIGNMENTS OF NEW COLLATERAL SECURITY" means the
assignments of Collateral Security executed by Originators in favour of
MML pursuant to the terms of the Origination Sale and Purchase
Agreement.
"ORIGINATOR TRANSFERS" means the transfers of Pre-Existing Mortgage
Loans by Originators in favour of MML pursuant to the Mortgage Transfer
Agreement and dated 27 February 1998, and transfers of Existing
Mortgage Loans originated since that date, dated the date of the
origination of the relevant Existing Mortgage being transfers by
Originators in favour of MML pursuant to the Originator Sale and
Purchase Agreement.
"ORIGINATORS AND MML POWER OF ATTORNEY" means the Power of Attorney of
even date in the form annexed to the Sale Agreement and therein
referred to as the "Buyer's Power of Attorney" executed by, inter alia,
the Originators (of Existing Mortgage Loans) and MML in favour of the
Borrower and the Lender.
"OUTSTANDING ADVANCES" means, on any day by reference to which the same
falls to be determined, the aggregate amount of all Advances
outstanding under the Facility.
"PERFORMING JUNIOR MORTGAGE LOAN" means a Junior Mortgage Loan which is
not a Non Performing Junior Mortgage Loan.
"PERFORMING SENIOR MORTGAGE LOAN" means each Existing Mortgage Loan,
New Production Mortgage Loan or Pipeline Loan financed hereunder and
which:
(a) is a Senior Mortgage Loan; and
(b) is not a Non Performing Senior Mortgage Loan.
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"PIPELINE LOANS" means the Mortgage Loans acquired by the Borrower
pursuant to the terms of the Supplemental Sale Agreement from time to
time, and financed hereunder;
"POTENTIAL EVENT OF DEFAULT" means any event which with the giving of
notice or the passing of time or both or the occurrence of any other
event will become an Event of Default.
"PRE-EXISTING MORTGAGE LOAN" means each Existing Mortgage Loan
originated on or before 27 February, 1998.
"REGISTERS OF SCOTLAND" means the Land Register of Scotland and/or the
General Register of Sasines.
"REGULATED MORTGAGE LOAN" means a Mortgage Loan that is a regulated or
partly regulated agreement for the purposes of the Consumer Credit Xxx
0000.
"REPAYMENT DATE" means in relation to any Advance, the date which shall
be 180 days following its Advance Date or the Final Maturity Date,
whichever is the earlier.
"REVOLVING ADVANCE" means an Advance drawn under the Revolving
Facility.
"REVOLVING COMMITMENT" means an initial commitment of 50,000,000 (fifty
million pounds) increasing to 100,000,000 (one hundred million pounds)
in the circumstances set out in clause 2.6 or such lesser amount
following a cancellation pursuant to clause 5 hereof.
"REVOLVING FACILITY" means the revolving credit facility made available
pursuant to clause 2.1(b).
"REVOLVING LOAN" means the aggregate of Advances drawn down against the
Revolving Commitment by the Borrower save to the extent that any such
Advances have been repaid to the Lender.
"SCOTTISH MORTGAGE LOAN" means a Mortgage Loan secured over a Mortgaged
Property situated in Scotland.
"SCOTTISH TRUST ASSIGNATION" has the meaning defined in the Debenture.
"SECURED LIABILITIES" means all liabilities and obligations of whatever
nature of the Borrower, OFC or any other person secured under any
Security Document.
"SECURITISATION BANK AGREEMENTS" means the six bank agreements dated 21
March 1996, 18 October 1996, 31 October 1996, 31 January 1997 and 30
April 1997 in relation to the Securitisations.
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"SECURITISATION COLLECTION ACCOUNT TRUSTS" means the CMC Collection
Account Declaration of Trust, the CMF Collection Account Declaration of
Trust, the GFS Master Collection Account Declaration of Trust and the
Greyfriars Originator Collection Account Declaration of Trust.
"SECURITISATIONS" means each of the six securitisations of Mortgage
Loans originated by CMC and certain of its subsidiaries, effected
through sales of the Mortgage Loans to the Issuers on 21 March, 1996,
18 October, 1996, 31 October, 1996, 31 January, 1997 and 30 April,
1997.
"SECURITISED MORTGAGE LOANS" has the meaning attributed to it in the
Debenture.
"SECURITY" includes any mortgage, sub mortgage, Standard Security,
fixed or floating charge, sub charge, encumbrance, lien, pledge,
hypothecation, absolute assignment, assignment by way of security, or
title retention arrangement, and any agreement or arrangement having
substantially the same economic or financial effect as any of the
foregoing (including any "hold back" or "flawed asset" arrangement).
"SECURITY DOCUMENTS" means the Debenture, (and each further security
document executed pursuant thereto including, without limitation, any
Supplemental Deed of Charge), the Account Assignments and any security
executed in respect of additional collateral provided pursuant to the
terms hereof.
"SENIOR MORTGAGE LOANS" means each Existing Mortgage Loan, New
Production Mortgage Loan and Pipeline Loan financed or to be financed
hereunder and which is secured by way of a first ranking legal mortgage
or first ranking Standard Security.
"SERVICE DOCUMENT" means "a writ, summons, order, judgment or other
process issued out of the courts of England and Wales in connection
with any Proceedings.
"SERVICER" means Ocwen UK Servicing Limited.
"SERVICING AGREEMENT" means the interim servicing agreement in form and
substance satisfactory to the Lender to be entered into on or about the
date hereof between the Borrower, the Lender and the Servicer.
"SOLICITOR LETTERS OF INSTRUCTION" means the form of letters of
instruction so described and annexed to each of the Agreed Form
Undertakings and Documentation Letters.
"SOLICITORS" means each of Tomlinsons, Xxxxxxx Xxxxxxxx Xxxxxxx & Co,
and in relation to Scottish Mortgage Loans, Xxxxxx MacFarlane Green and
each other firm of solicitors approved in writing by the Lender, each
comprising a minimum of two partners holding current practicing
certificates issued by the Law Society or the Law Society of Scotland,
engaged by the Borrower to undertake conveyancing and/or security
enforcement services in relation to Mortgaged Properties, and who carry
professional indemnity insurance in the sum of at least (pound
sterling) 1,000,000 for each and every claim against them by any party
in any one year or such increased amount as may from time to time be
prescribed by the Lender, acting reasonably.
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"SOLICITORS CERTIFICATE OF TITLE AND UNDERTAKING" means the certificate
of title and undertaking to be attached to each Drawdown Request in
relation to Advances under the Revolving Commitment in the form set out
in Schedule 5 addressed to the Borrower and the Lender (in relation to
both the origination of New Production Mortgage Loans and the
acquisition of Pipeline Loans).
"SOLICITORS UNDERTAKING" means the Solicitors Certificate of Title and
Undertaking, the Solicitors Undertaking re: Existing Mortgage Loans;
the Solicitors Undertaking re: New Advance Monies; and the Solicitors
Undertaking re: New Mortgage Loans in the forms set out in Schedule 5.
"SOLICITOR'S UNDERTAKING RE: EXISTING MORTGAGE LOANS" means the form of
undertaking so described and annexed to each of the Agreed Form
Undertakings and Documentation Letters and set out in Schedule 5
hereto;
"SOLICITOR'S UNDERTAKING RE: NEW ADVANCE MONIES" means the form of
undertaking so described and annexed to each of the Agreed Form
Undertakings and Documentation Letters and set out in Schedule 5
hereto;
"SOLICITOR'S UNDERTAKING RE: NEW MORTGAGE LOANS" means the form of
undertaking so described and annexed to each of the Agreed Form
Undertakings and Documentation Letters and set out in Schedule 5;
"STANDARD SECURITY" means a standard security in terms of the
Conveyancing and Feudal Reform (Scotland) Xxx 0000.
"STANDARD FORM DOCUMENTATION" means the standard form documents used or
to be used by the Borrower or CMC and the other Donors (as defined
under the Supplemental Sale Agreement) where origination has continued
in the name of such companies after the date hereof in the origination
of Mortgage Loans as the same have been initialled by the parties
hereto for the purpose of identification and annexed hereto in Annexure
2 or as otherwise changed, varied or substituted by or on behalf of the
Borrower as approved and agreed by the Lender.
"SUBSIDIARY" has the meaning given to it by section 736 of the
Companies Xxx 0000 save that references therein to company shall be
deemed to include a company which has not been formed and registered
under the Companies Xxx 0000.
"SUPPLEMENTAL SALE AGREEMENT" means the origination and transfer
agreement to be entered into on or about the date hereof between, inter
alia, the Borrower, CMC and the Donors (as defined thereunder).
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"SUPPLEMENTAL SECURITY POWERS OF ATTORNEY" means the powers of attorney
granted by the Borrower in favour of the Solicitors in the form set out
in Schedule 5 hereto.
"SUPPLEMENTAL DEED OF CHARGE" means any supplemental charge or
assignation in security made by the Borrower in favour of the Lender
pursuant to the Debenture.
"TERM" means save as otherwise provided herein, in relation to any
Advance, the period commencing on (and including) the date on which
such Advance is made and ending on (but excluding) the Repayment Date
relating to such Advance.
"TERM LOAN" means a loan in the amount of (pound sterling)
225,276,933.93 to be made available to finance the purchase of all
Existing Mortgage Loans to be acquired by the Borrower pursuant to the
Sale Agreement.
"TERM LOAN REPAYMENT DATE" means the date which shall be 180 days after
the date on which the Term Loan is drawn or, if such day is not a
Business Day the immediately preceding Business Day.
"TRANSACTION DOCUMENTS" means this Agreement, the Security Documents,
the Indemnity, the Servicing Agreement, and each other document at any
time entered into between all or any of the Borrower, OFC, the Lender,
the Servicer and any third party pursuant to or in connection with any
document which is a Transaction Document.
"UNDERTAKING" means the undertaking to be given by OFC to the Borrower
on or about the date hereof, in form and substance satisfactory to the
Lender.
"UNDERWRITING GUIDELINES" means the underwriting guidelines published
by City Mortgage Corporation Limited as adopted by the Borrower as at
the date of completion under the Sale Agreement, and initialled by the
parties hereto for the purpose of identification and attached hereto as
Annexure 2 as the same may be amended or supplemented from time to time
with the prior written consent of the Lender.
the "LENDER" shall be construed so as to include its and any subsequent
successors and assigns in accordance with their respective interests.
a "MONTH" is a reference to a period starting on one day in a calendar
month and ending on the numerically corresponding day in the next
following calendar month; PROVIDED that, where any such period would
otherwise end on a day which is not a Business Day, it shall end on the
following succeeding Business Day, unless that day falls in the
calendar month next following that in which it would otherwise have
ended, in which case it shall end on the immediately preceding Business
Day; and provided further that, if there is no numerically
corresponding day in the next following calendar month, that period
shall end on the last Business Day in that next following calendar
month (and references to "MONTHS" shall be construed accordingly).
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a "PERSON" shall be construed as a reference to any person, firm,
company, corporation, government, state or agency of a state or any
association or partnership (whether or not having separate legal
personality) of two or more of the foregoing.
"REPAY" (or any derivative form thereof) shall, subject to any contrary
indication, be construed to include "PREPAY" (or, as the case may be,
the corresponding derivative form thereof).
"TAX" shall be construed so as to include any present or future tax,
levy, impost, duty or other charge of a similar nature (including any
penalty or interest payable in connection with any failure to pay or
any delay in paying any of the same).
"VAT" shall be construed as a reference to value added tax including
any similar tax which may be imposed in place thereof from time to
time.
the "WINDING-UP", "DISSOLUTION" or "ADMINISTRATION" of a company or
corporation shall be construed so as to include any equivalent or
analogous proceedings under the law of the jurisdiction in which such
company or corporation is incorporated or any jurisdiction in which
such company or corporation carries on business including the seeking
of liquidation, winding-up, reorganisation, dissolution,
administration, arrangement, adjustment, protection or relief of
debtors.
1.2 INTERPRETATION
For the purposes of this Agreement except as otherwise expressly
provided or unless the context otherwise requires:-
(1) accounting terms not otherwise defined herein have the
meanings assigned to them in accordance with generally
accepted accounting principles save that references herein to
GAAP are to generally accepted accounting principles in the
United States of America;
(2) references herein to "clauses", "sub-clauses", "paragraphs",
and other subdivisions without reference to a document are to
designated clauses, sub-clauses paragraphs and other
subdivisions of this Agreement;
(3) reference to a sub-clause without further reference to a
clause is a reference to such sub-clause as contained in the
same clause in which the reference appears, and this rule
shall also apply to paragraphs and other subdivisions;
(4) the words "herein", "hereof", "hereunder" and other words of
similar import refer to this Agreement as a whole and not to
any particular provision;
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(5) headings to clauses and Schedules are for convenience only and
do not affect the interpretation of this Agreement;
(6) references to a "company" shall be construed so as to include
any company, corporation or other body corporate, wherever and
however incorporated or established;
(7) references to times of the day are to London time;
(8) references to any agreement (including without limitation to
each Transaction Document), shall be construed as a reference
to such agreement as the same may be, or may from time to time
have been, amended, modified, supplemented or restated in
accordance with the terms of the Transaction Documents;
(9) "(pound sterling)", "POUNDS" and "STERLING" denote the lawful
currency of the United Kingdom;
(10) any reference in this Agreement to a statute shall be
construed as a reference to such statute as the same may have
been, or may from time to time be, amended, modified or
re-enacted.
2. THE FACILITY AND PURPOSE
2.1 The Lender hereby grants to the Borrower a credit facility comprising:-
(1) the Term Loan; and
(2) a revolving credit facility in an initial maximum aggregate
principal amount of 50,000,000 (fifty million pounds)
increasing to 100,000,000 (one hundred million pounds) in the
circumstances set out in clause 2.6 or such lesser amount
following a cancellation pursuant to Clause 5, on and subject
to the terms of this Agreement.
2.2 At no time may the aggregate principal amount of Advances drawn under
the Revolving Facility hereunder exceed the Revolving Commitment.
2.3 The Initial Advance will be used by the Borrower for the sole purpose
of financing the purchase of the Existing Mortgage Loans from inter
alia, MML on the terms of the Sale Agreement.
2.4 Advances drawn under the Revolving Facility will be used by the
Borrower for the sole purpose of financing the origination of New
Production Mortgage Loans or the purchase of Pipeline Loans pursuant to
the Supplemental Sale Agreement.
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2.5 The Lender shall not be obliged to concern itself with the application
of amounts borrowed by the Borrower under this Agreement and
application by the Borrower of funds so borrowed contrary to the
provisions of clauses 2.3 and 2.4 shall not prejudice the Lender's
rights hereunder or under any other Transaction Document.
2.6 The Revolving Commitment shall increase in the following manner:-
(a) upon repayment of (pound sterling) 200,000,000 of the Term
Loan, from 50,000,000 (fifty million pounds) to 75,000,000
(seventy five million pounds);
(b) thereafter for every (pound sterling) 1.00 repaid under the
Term Loan, by (pound sterling) 1.00; and
(c) in any event, upon repayment of the Term Loan in full to
100,000,000 (one hundred million pounds).
2.7 The Lender shall cease to be obliged to make any Advances hereunder on
the Final Maturity Date and any undrawn portion of the Revolving
Commitment shall be automatically cancelled on that date.
2.8 The Borrower may, not later than 7 days prior to the then current Final
Maturity Date, by written notice to the Lender, request an extension of
the Revolving Facility for a further period provided that the Borrower
may only request an extension which would not, if granted, cause the
overall term of the Revolving Facility to exceed 364 days.
2.9 In the event that the Borrower requests an extension of the Revolving
Facility pursuant to clause 2.8 the Lender may, in its sole discretion,
agree to the requested extension or may agree to an extension of the
Revolving Facility for a further period which is less than the
requested extension, and shall, by notice in writing to the Borrower to
be given no later than 2 days prior to the then current Final Maturity
Date inform the Borrower of its decision. For the avoidance of doubt
the Lender shall be under no obligation whatsoever to agree to any
requested extension of the Revolving Facility.
3. AVAILABILITY
3.1 The Facility will not become available to the Borrower and the Lender
shall be under no obligation to make any Advance hereunder until each
of the following conditions precedent shall have been fulfilled to the
satisfaction of the Lender:
(1) the Lender shall have received each of the following
documents, each in form and substance satisfactory to it:-
(1) a certified copy of the Certificate of Incorporation
and Memorandum and Articles of Association or
constitutional documents of each of the Borrower, OFC
(comprising, in the case of OFC, articles of
incorporation, byelaws and a certificate of good
standing) and the Servicer each duly certified by the
secretary or a director of the relevant company as
true, accurate and complete as at the date of drawing
of the Initial Advance;
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(2) originals (or, where the Lender is not party to the
relevant document, certified copies) of each of the
following documents, duly executed by each party
thereto other than the Lender:-
(1) the Indemnity, Counter Indemnity and
Undertaking;
(2) the Security Documents and all notices and
acknowledgements thereof to be given and
received thereunder and all consents to any
such security being granted;
(3) the Servicing Agreement;
(4) the Collection Account Novation Agreement, the
Master Novation Agreement and all documents
referred to therein, including without
limitation mandates relating to the Collection
Accounts and declarations of trust;
(5) the Sale Agreement including all schedules
thereto and the disclosure letter relating
thereto;
(6) the Supplemental Sale Agreement (and the CMC
Transfer Power of Attorney annexed thereto);
(7) Solicitors Undertaking re: Existing Mortgage
Loans;
(8) MML Transfers;
(9) Scottish Trust Assignation;
(10) Intimations of Assignation of Trust Property;
(11) MML Assignment of Collateral Security;
(12) Originator and MML Power of Attorney;
(13) Deferred Assignment of Collateral Security;
(14) Agreed Form Undertakings and Documentation
Letters;
(15) Originator Transfers;
(16) Originator Assignments of Collateral Security;
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(17) Solicitor Letters of Instruction;
(18) Solicitors Undertaking re: New Advance Monies;
(19) Supplemental Security Power of Attorney;
(20) CMC Transfer Power of Attorney;
(21) Standard Security Sasine Register and Land
Register;
(3) in respect of each of the Borrower, OFC and the
Servicer, a copy (certified by the secretary or a
director or equivalent officer of the relevant
company to be true, complete and up to date as at the
date of drawing of the Initial Advance) of all board
minutes and all other resolutions and authorisations
passed or given in relation to the Transaction
Documents;
(4) in respect of the Borrower, a solvency certificate in
the form set out in Schedule 2 dated the date of the
Initial Advance;
(5) in respect of each of the Borrower, OFC and the
Servicer a copy (certified by the secretary or a
director or equivalent officer of the relevant
company to be true, complete and up to date as at the
date of advance of the Initial Advance) of all
consents, approvals, authorisations or orders of any
court or governmental agency or body (including,
without limitation, the OFT) required for the
execution, delivery and performance by it of, or
compliance by it with, the terms of any Transaction
Document or the consummation of the transactions
contemplated thereby;
(6) in relation to each of the Borrower and the Servicer
a copy (certified by the secretary or a director of
the relevant company as in full force and effect) of
the Consumer Credit Act license held by such company
together with evidence of registration of each such
company under the Data Protection Xxx 0000;
(7) duly executed account mandates in relation to the
Borrower Funding Account and the Borrower Collection
Account, specifying the authorised signatories for
the Borrower;
(8) Assignations of the Scottish Declarations of Trust or
Supplemental Declarations of Trust (as the case may
be) in favour of the Borrower executed by MML.
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(2) the Lender shall have received confirmation as to the identity
of all Solicitors engaged or intended by the Borrower as at
the date of this Agreement to be engaged in relation to
conveyancing and/or security enforcement concerning Mortgaged
Properties, together with evidence as to their respective
professional indemnity insurance cover;
(3) all conditions precedent under each other Transaction Document
(other than any requirement that the Facility shall have
become available hereunder) shall have been fulfilled or
expressly waived by the Lender;
(4) the Lender shall have received legal opinions, each in form
and substance satisfactory to it, from each of the following
firms:
(1) Edge and Xxxxxxx;
(2) Tods Xxxxxx;
(3) Akin, Gump, Strauss, Xxxxx & Xxxx LLP; and
(4) in house counsel to OFC.
(5) all conditions precedent to the Novation Agreements shall have
been satisfied; and
(6) the Lender shall have received a copy of the acceptances of
appointment as agent for service of process under clause 30.
4. DRAWINGS
4.1 Subject to:-
(1) The conditions precedent in Clause 3 having been fulfilled to
the satisfaction of the Lender or waived by the Lender;
(2) no Event of Default or Potential Event of Default having
occurred and subsisting unremedied (to the satisfaction of the
Lender) and unwaived;
(3) there having been received from the Borrower by the Lender not
later than 5pm (London time) on the Business Day before the
date on which the Initial Advance is to be made a duly
completed Drawdown Request relating thereto including a
schedule giving required details of each Existing Mortgage
Loan,
the Lender will make the Initial Advance to the Borrower on the date
hereof.
4.2 Subject to:-
(1) each condition precedent in Clause 3 having been fulfilled to
the satisfaction of the Lender or waived by the Lender;
22
(2) no Event of Default or Potential Event of Default having
occurred and subsisting unremedied (to the satisfaction of the
Lender) and unwaived;
(3) there having been received from the Borrower by the Lender not
later than 5pm (London time) on the Business Day before the
date on which an Advance under the Revolving Commitment is to
be made a Solicitor's Certificate of Title and Undertaking in
respect of each Mortgage Loan the origination or acquisition
of which the Borrower proposes to finance by the relevant
Advance and a duly completed Drawdown Request (and a schedule
thereto) together with a copy of the schedules of all Mortgage
Loans to be originated or acquired on its behalf on the
relevant date and a data tape in respect of the relevant
Mortgage Loans, in computer readable form, containing such
information regarding the Mortgage Loans as was previously
provided to the Lender under the MML Loan Facility Agreement
immediately prior to the date hereof;
(4) the Lender having approved the Mortgage Loans to be financed,
such approval to be evidenced by the Lender by signing the
schedule of Mortgage Loans and the related Drawdown Request
having deleted therefrom any Mortgage Loans which do not meet
the Underwriting Guidelines;
(5) no event described under 17.1 (l), (m), (n) or (o) having
occurred;
(6) no Minded to Revoke Notice having been served on the Borrower
or the Servicer;
(7) no injunction or interdict having been obtained by (or on
behalf of) the OFT against the Borrower or the Servicer which
relates to its respective residential mortgage lending
activities including, without limitation, any Mortgage Loan
financed hereunder;
(8) where the proposed Advance is to fund Mortgage Loans secured
by a Mortgage over unregistered land where the Borrower does
not hold the title deeds to such Mortgaged Property (and in
relation to which the Borrower's legal mortgage is therefore a
second or subsequent ranking legal mortgage protected at
Central Land Charges Registry by registration of a C(i) Land
Charge) the Lender shall have received a schedule of such
Mortgage Loans (together in relation to such Mortgage Loans
with the full names of the owners of such Mortgaged Property
and the full address of that Mortgaged Property);
(9) where the proposed Advance is to fund a Pipeline Loan:-
(1) the date of the Advance being no later than two
months after the date hereof;
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(2) no event described under 17.1(l) having occurred and
no petition for an administration order having been
presented in relation to CMC or other Donor (as
defined in the CMC Transfer Power of Attorney); and
(3) each Donor (as described in the CMC Transfer Power of
Attorney) having, at the time of the proposed
Advance, a valid consumer credit license,
the Borrower may draw additional Advances under the Revolving
Commitment (subject to the provisions of this Agreement) Provided
always that:-
(i) Advances may be made on Business Days during the
Availability Period;
(ii) each Advance shall be a minimum of (pound sterling)
100,000 or, if less than (pound sterling) 100,000,
the Available Commitment;
(iii) no Advance shall be made to the extent that, if as a
result thereof the Revolving Loan for the time being
outstanding would exceed the Revolving Commitment;
(iv) no Advance shall be made or may be requested to
refinance any Mortgage Loan the origination or
purchase of which was financed by a prior Advance
under this Agreement;
(v) the amount of each Advance requested shall not be
greater than the amount equal to the Advance
Percentage of the Advance Date Principal Balance of
the particular Mortgage Loan.
4.3 Subject to the foregoing provisions of this Clause 4, upon receipt of a
duly executed Drawdown Request, the Lender shall, not later than 10 am
New York time on the date on which the Advance is to be made (or such
later time as maybe agreed between the Borrower and the Lender), make
the Advance requested, such Advance to be credited to the Borrower
Funding Account or, after prior consultation with and written notice to
the Borrower, the applicable Solicitors and the Servicer, to be
advanced to the Solicitors acting for the Borrower in relation to the
particular New Production Mortgage Loans or Pipeline Loans, against the
Solicitors Undertaking re: New Advance Monies from the relevant
Solicitors, and it is acknowledged (for the avoidance of doubt) that
any Advance paid to Solicitors under clause 4.3 shall be deemed to have
been drawn by the Borrower under this Agreement on the date of such
payment.
4.4 If the Borrower fails for any reason whatsoever (other than as a
consequence of a breach of the Lender's obligations) to draw down an
Advance after a Drawdown Request has been received by the Lender
(whether such failure be the result of the occurrence of an Event of
Default or otherwise), the Borrower will pay to the Lender on demand
such amount as the Lender certifies to be necessary to compensate for
all losses excluding loss of Margin incurred or to be incurred on
account of deposits acquired or arranged in order to fund the Advance.
Any such certificate by the Lender shall be PRIMA FACIE evidence of
such losses.
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4.5 In the event that no duly completed Solicitors Undertaking re: New
Mortgage Loans shall have been received by the Lender in respect of any
Mortgage Loan(s) in respect of which an Advance shall have been made
hereunder by the close of business on the third Business Day following
the making of the Advance the Lender shall immediately notify the
Borrower and an amount equal to the Advance, or such part thereof as
was advanced in respect of such Mortgage Loan or Mortgage Loans shall
become immediately due and repayable by the Borrower to the Lender
together with accrued interest thereon.
4.6 If all or any part of any Advance made to finance a Mortgage Loan which
is subject to the provisions of Clause 4.5 shall be held by any
Solicitors payment in full by such Solicitors to the Lender of the
amounts due under Clause 4.5 shall discharge the Borrower's obligation
to pay the same.
4.7 All parties hereby agree and acknowledge that:
(1) all sums credited to the Borrower Funding Account shall be
subject to the Borrower Funding Account Assignment; and (1)
(2) all sums credited to the Borrower Collection Account shall be
subject to the Borrower Collection Account Assignment.
5. CANCELLATION
5.1 The Borrower may at any time by giving not less than two Business Days
irrevocable written notice to the Lender cancel any amount (in integral
multiples of (pound sterling) 5,000,000) of the Revolving Commitment to
the extent not currently outstanding or requested in a current Drawdown
Request Provided that the cancelled amount does not reduce the
Revolving Commitment below the outstanding principal amount of Advances
drawn under the Revolving Commitment plus the amount of Advances
requested in a current Drawdown Request.
5.2 During such period of notice the Borrower may not serve a Drawdown
Request purporting to draw all or any part of the amount of the subject
of such notice of cancellation.
5.3 Upon such cancellation becoming effective, the Revolving Commitment
shall be appropriately reduced.
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6. INTEREST ON ADVANCES
6.1 The Borrower will pay interest on each Advance on each Interest Payment
Date in respect of each Interest Period referable thereto at the rate
per annum equal to the aggregate of (i) the Margin and (ii) LIBOR for
the relevant Interest Period.
6.2 The Lender will, as soon as practicable after commencement of each
Interest Period advise the Borrower of LIBOR for that Interest Period.
Any certificate of the Lender as to the rate and amount of interest
determined by it under this Agreement in respect of any Interest Period
shall, save for manifest error, be conclusive and binding on the
Borrower and OFC.
6.3 Interest at the rate determined as aforesaid shall be calculated on
each Advance and each part thereof on the basis of actual days elapsed
and a 365 day year, shall accrue from day to day from and including the
first day of each Interest Period to but excluding the date of
repayment of such Advance.
6.4 If LIBOR cannot be determined for any reason the rate of interest
applicable to such Advance shall be the sum of the Margin and the rate,
expressed as a percentage rate per annum, which is the actual cost to
the Lender of funding such Advance from whatever sources it may select
during such Interest Period (as applicable) and, if the Lender so
requires, within five days of such notification the Lender and the
Borrower shall enter into negotiations with a view to agreeing a
substitute basis for determining the rates of interest which may be
applicable to Advances in the future.
7. REPAYMENT AND APPLICATION OF RECEIPTS
7.1 The Borrower shall, subject as provided herein, repay the amount of the
Term Loan then outstanding in full on the Term Loan Repayment Date. Any
amount repaid, or any part thereof, may not be redrawn.
7.2 The Borrower shall repay the whole of the outstanding amount of each
Revolving Advance on the Repayment Date relating thereto. Any amount
repaid or any part thereof may, subject to the provisions of this
Agreement, be redrawn.
7.3 If on any Interest Payment Date there is a BORROWING BASE DEFICIENCY
the Borrower shall, at its option, on the Business Day immediately
following the Interest Payment Date either:-
(1) prepay an amount equal to the amount of the Borrowing Base
Deficiency; or
(2) provide additional Eligible Collateral of a value which is
determined by the Lender to be at least equal to the amount of
the Borrowing Base Deficiency, charged (by way of first fixed
charge) in favour of the Lender.
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7.4 On each Interest Payment Date all amounts standing to the credit of the
Borrower Collection Account shall be applied in or toward satisfaction
of obligations of the Borrower in the following order of priority:-
(a) first, in or toward payment of all interest falling due to the
Lender hereunder on the relevant Interest Payment Date
together with any overdue interest accrued thereon up to and
including the relevant distribution date;
(b) second, in or towards repayment of any Borrowing Base
Deficiency or any other amount due under Clause 7 on such
date;
(c) third, in or towards payment of all amounts due and owing to
the Lender under all Transaction Documents other than the
foregoing; and
(d) the balance to be released to the Borrower,
Provided that at all times following an Acceleration the provisions of
this Clause 7.4 shall cease to apply and after such time all amounts
received or recovered in respect of the assets subject to the Security
Documents may be applied by the Lender in or towards satisfaction of
the Secured Liabilities in such order as the Lender in its absolute
discretion shall determine.
7.5 If the Borrower is required to repay principal on any Advance on any
day other than an Interest Payment Date, the Borrower shall be obliged
to pay such amount together with interest accrued thereon to the date
of such repayment.
7.6 If all or any part of any Advance is repaid under this clause other
than on an Interest Payment Date, the Borrower will pay to the Lender
on demand such amount as the Lender certifies to be necessary to
compensate it for all losses excluding loss of Margin incurred or to be
incurred by it on account of deposits acquired or arranged in order to
fund the relevant Advance except in the case of repayment of any
Advance pursuant to a securitisation underwritten by Greenwich Capital
Markets, Inc. of Mortgage Loans financed hereunder. Any such
certificate by the Lender shall be PRIMA FACIE evidence of such losses.
7.7 Subject to Clause 7.6, the Borrower may on any Business Day, upon five
Business Days prior written notice to the Lender, prepay in whole or in
part any Advance outstanding hereunder together with all accrued
interest thereon.
7.8 If the outstanding Advances are prepaid pursuant to clause 10.6 or
clause 11.4, the Revolving Commitment shall be reduced to zero and the
Lender shall cease to be obliged to make Advances hereunder.
27
8. EXAMINATION OF MORTGAGE FILES
8.1 The Lender shall have the right to examine the Mortgage Files to
determine whether the Mortgage Loans to be financed fulfill the
Underwriting Guidelines. Such examination may be made by the Lender at
any time before or after the date on which any Advance is to be or was
made.
8.2 If the Lender makes such examination prior to the date on which an
Advance is to be made and properly identifies any Mortgage Loans which
do not fulfill the Underwriting Guidelines such Mortgage Loans shall be
deleted from the schedule of Mortgage Loans appended to the Drawdown
Request.
8.3 The Lender may make an Advance without conducting any partial or
complete examination. The fact that the Lender has conducted or has
failed to conduct any partial or complete examination of the Mortgage
Files shall not affect the Lender's (or any of its successor's) rights
provided herein.
9. EVIDENCE OF DEBT
The Lender shall maintain in accordance with its usual practice
accounts evidencing the amounts from time to time lent by and owing to
it hereunder, and in any legal action or proceeding arising out of or
in connection with this Agreement, the entries made in such accounts
shall in the absence of manifest error be PRIMA FACIE evidence of the
existence and amounts of the specified obligations of the Borrower.
10. TAXES
10.1 The Lender and the Borrower intend:
(1) that they shall not vary this Agreement so as to extend:
(1) the term of the Term Loan;
(2) the period during which any Advance may be drawn down
or outstanding, beyond the Final Maturity Date, and
(2) that the Lender shall not make any further advance or advances
to the Borrower after the Final Maturity Date under or
pursuant to any further agreement; and
(3) that this clause 10.1 shall be without prejudice to the
provisions of clause 16.9.
10.2 Accordingly, all payments to be made by the Borrower to the Lender
hereunder shall be made free and clear of and without deduction or
withholding for or on account of tax.
28
10.3 If the Borrower is nevertheless required as a result of any change in
law or in its interpretation or administration to make any payment to
the Lender hereunder subject to any deduction or withholding on account
of tax the sum payable by the Borrower in respect of which such
deduction or withholding is required to be made shall (subject to
Clause 10.8) be increased to the extent necessary to ensure that, after
the making of the required deduction or withholding, the Lender
receives and retains (free from any liability in respect of such
deduction or withholding) a net sum equal to the sum which it would
have received and so retained had no such deduction or withholding been
made or required to be made.
10.4 If the Borrower makes any payment hereunder in respect of which it is
required by law to make any deduction or withholding on account of tax,
it shall pay the full amount required to be deducted or withheld to the
relevant taxation or other authority within the time allowed for such
payment under applicable law and shall deliver to the Lender, within
thirty days after it has made such payment to the applicable authority,
an original receipt (or a certified copy thereof) issued by such
authority evidencing the payment to such authority of all amounts so
required to be deducted or withheld in respect of such payment or any
other written evidence acceptable to the Lender.
10.5 All amounts payable under this Agreement are expressed to be exclusive
of any VAT chargeable in respect thereof. If any VAT is chargeable in
respect of such amounts, the Borrower shall, in addition, pay to the
Lender an amount equal to such VAT, and the Lender shall provide the
Borrower with a proper VAT invoice in respect thereof.
10.6 If the Lender or the Borrower becomes aware that the Borrower will be
required as a result of any change in law or its interpretation or
administration to make any payment to the Lender hereunder subject to
any deduction or withholding on account of tax, the Lender or, as the
case may be, the Borrower shall, promptly upon becoming aware of the
same, notify the other party, in writing, setting out the reasons for
the anticipated deduction or withholding and the date from which such
deduction or withholding will be required by law to be made (such date
the "WITHHOLDING DATE").
10.7 The Borrower shall be entitled, at any time within 45 days after the
giving or receipt of notice under clause 10.6 to prepay all (but not
part) of the Advances (together with all interest accrued thereon and
other amounts then due hereunder) provided that:-
(1) notice of prepayment pursuant to this clause 10.7 must state
that the prepayment is to be made pursuant to this clause
10.7; and
(2) the provisions of clause 7.6 shall not apply in respect of any
such prepayment.
10.8 If, during the 45 day period, the Borrower is required to make any
payment to the Lender hereunder subject to a deduction or withholding,
the Borrower shall be entitled to make such payment net of the
deduction or withholding but shall be obliged to pay the amount
deducted or withheld to the relevant taxation authority in accordance
with clause 10.4.
29
10.9 If, at the expiration of the 45 day period the Borrower has not prepaid
under clause 10.7, the provisions of clause 10.3 shall apply from the
46th day.
11. INCREASED COSTS
11.1 If, by reason of:-
(1) the introduction of, or any change in any applicable law,
regulation or regulatory requirement or any change in the
interpretation or application of any thereof in each case
after the date hereof and/or
(2) compliance by the Lender or any holding company of the Lender
with any applicable directive, request or requirement whether
or not having the force of law but, if not having the force of
law being of general application and of a type with which the
Lender or a holding company of the Lender is accustomed to
comply of any central bank or any self regulating organisation
or any governmental, fiscal, monetary or other authority
(including, but not limited to, a directive, request or
requirement which affects the manner in which any bank
allocates capital in support of its assets or liabilities or
contingent liabilities or deposits with it or for its account
or advances or commitments made by it) which is brought into
effect after the date hereof,
and if, to the extent of compliance with either or both of paragraphs
(a) and (b):-
(3) the Lender or any holding company of the Lender is unable to
obtain the rate of return on its capital which it would have
been able to obtain but for the Lender's entering into or
assuming or maintaining a commitment or performing its
obligations (including its obligation to make Advances) under
this Agreement;
(4) the Lender or any holding company of the Lender incurs a cost
as a result of the Lender's entering into or assuming or
maintaining a commitment or performing its obligations
(including its obligation to make Advances) under this
Agreement;
(5) there is any increase in the cost to the Lender or any holding
company of the Lender of funding or maintaining all or any of
the Advances;
(6) the Lender or any holding company of the Lender becomes liable
to make any payment on account of tax or otherwise (except on
account of any tax imposed on and calculated by reference to
the net income of the Facility Office by the jurisdiction in
which the Lender (or its holding company) is incorporated or
in
30
which the Facility Office is located), or foregoes any
interest or other return, on or calculated by reference to the
amount of any Advance or the amount of any sum received or
receivable by it (or its subsidiary) under this Agreement,
then the Borrower shall, from time to time on demand of the Lender,
promptly pay to the Lender amounts sufficient to indemnify the Lender
and its holding company against, as the case may be, (1) such reduction
in the rate of return of capital, (2) such cost, (3) such increased
cost (or such proportion of such increased cost as is, in the opinion
of the Lender, attributable to its or its holding company funding or
maintaining the Advance), or (4) such liability.
11.2 If the Lender intends to make a claim pursuant to clause 11.1 it shall
notify the Borrower of the event by reason of which it is entitled to
do so, such notification to be given as soon as practicable following
the Lender becoming aware of the same, PROVIDED that nothing herein
shall require the Lender to disclose any confidential information
relating to the organisation of its affairs.
11.3 If the Borrower receives notice under clause 11.2, then without
prejudice to the Lender's rights under clause 11.1, the Lender shall
consult with the Borrower as to possible steps that could be taken to
reduce any such increased costs, provided that the Lender shall be
under no obligation to take any such steps considered.
11.4 Upon receipt of a notice under clause 11.2 the Borrower shall be
entitled, upon the giving of 5 Business Days written notice, to prepay
all (but not part) of the Advances (together with all interest accrued
thereon and other amounts then due hereunder) provided that the
provisions of clause 7.6 shall not apply in respect of any such
prepayment.
12. ILLEGALITY
If, at any time, it is or becomes unlawful for the Lender to make, fund
or allow to remain outstanding all or part of any of the Advances, then
the Lender shall, promptly after becoming aware of the same, deliver to
the Borrower a notice to that effect, the Lender shall not thereafter
be obliged to make any Advances hereunder, the Revolving Commitment
shall be immediately reduced to zero and, if the Lender so requires,
the Borrower shall on such date as the Lender shall have specified
repay any outstanding Advances, in each case together with accrued
interest thereon and all other amounts owing to the Lender hereunder.
13. PAYMENTS
Any payment to be paid by the Borrower to the Lender pursuant to this
Agreement shall be made in sterling, in immediately available, freely
transferrable and cleared funds for value same day, to such account of
the Lender as the Lender shall, from time to time, have specified in
writing for such purpose.
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14. REPRESENTATIONS AND WARRANTIES
14.1 The Borrower and OFC (each in relation to itself) hereby represent,
warrant, covenant and undertake to the Lender that (except as
previously disclosed to the Lender in writing on or prior to the date
hereof):-
(1) it is a limited liability company duly incorporated under the
laws of England and Wales and, in the case of OFC, it is a
corporation duly incorporated and validly existing and in good
standing under the laws of the State of Florida and is duly
authorised and qualified to transact any and all business
contemplated by this Agreement and the other Transaction
Documents to be conducted by it and is in compliance with such
laws to the extent necessary to ensure its ability to enforce
each Mortgage Loan;
(2) it has the full corporate power and authority to execute,
deliver and perform, and to enter into and consummate the
transactions contemplated by this Agreement and the other
Transaction Documents to which it is a party and has been duly
authorised by all necessary corporate action on its part the
execution, delivery and performance of this Agreement and the
other Transaction Documents to which it is a party; and this
Agreement and each Transaction Document to which it is a
party, assuming the due authorisation, execution and delivery
thereof by the Lender, constitutes its legal, valid and
binding obligation, enforceable against it in accordance with
its respective terms, except to the extent that (a) the
enforceability thereof may be limited by bankruptcy,
insolvency, moratorium, receivership and other similar laws
relating to creditors' rights generally and (b) the remedy of
specific performance and injunctive and other forms of
equitable relief may be subject to the equitable defenses and
to the discretion of the court before which any proceeding
therefor may be brought;
(3) its execution and delivery of this Agreement and each
Transaction Document to which it is a party, the consummation
of any other of the transactions herein or therein
contemplated on its part and the fulfillment of or compliance
with the terms hereof or thereof will not (i) result in a
material breach of any term or provision of its Memorandum and
Articles of Association and/or its other constitutional
documents or (ii) materially conflict with, result in a
material breach, violation or acceleration of, or result in a
material default under, the terms of any other material
agreement or instrument to which it is a party or by which it
may be bound, or any statute, order or regulation applicable
to it of any court, regulatory body, administrative agency or
governmental body having jurisdiction over it;
(4) it is not party to, bound by, or in breach or violation of any
material indenture or other material agreement or instrument,
or subject to or in violation of any statute, order or
regulation of any court, regulatory body, administrative
agency or governmental body having jurisdiction over it, which
materially and adversely affects or, to its knowledge, would
in the future materially and adversely affect, (i) its ability
to perform its obligations under this Agreement or the
Transaction Documents to which it is a party or (ii) its
business, operations, financial condition, properties or
assets taken as a whole;
32
(5) no litigation is pending or, to the best of its knowledge,
threatened against it that would materially and adversely
affect the execution, delivery or enforceability of this
Agreement or the Transaction Documents to which it is a party
or its ability to perform any of its obligations hereunder or
thereunder in accordance with the terms hereof or thereof;
(6) no consent, approval, authorisation or order of any court or
governmental agency or body is required for the execution,
delivery and performance by it of, or compliance by it with,
this Agreement or any Transaction Document to which it is a
party or the consummation of the transactions contemplated
hereby or thereby, or if any such consent, approval,
authorisation or order is required, it has obtained or it is
in the process of obtaining the same.
14.2 The representations and warranties under clause 14.1(a)-(f) inclusive
shall be given on the date of this Agreement and shall be repeated on
each date on which any Advance is outstanding hereunder by reference to
the facts and circumstances existing at the relevant time.
14.3 The Lender represents and warrants to the Borrower in terms of clauses
14.1(a) to (f) (inclusive), mutatis mutandis, provided that the
reference in clause 14.1(a) to England and Wales shall be construed as
a reference to Bermuda.
14.4 (a) The Borrower hereby represents and warrants (as of the date
hereof and the date on which the Initial Advance is made)
that:
(1) with respect to each Pre-Existing Mortgage Loan, each
of the representations and warranties set out in
paragraph 7.3 of the Mortgage Loan Purchase Agreement
as set out in Schedule 4 Part I hereto was, on the
date on which such Pre-Existing Mortgage Loan was
completed true and accurate in all respects; and
(2) with respect to each Existing Mortgage Loan which is
not a Pre-Existing Mortgage Loan, each of the
representations and warranties set out in paragraph
14.3(B) of the MML Loan Facility Agreement as set out
in Schedule 4 Part II hereto was on the date referred
to therein in respect of such Existing Mortgage Loan
true and accurate in all respects.
33
(2) The Borrower hereby represents and warrants to the
Lender in relation to each New Production Mortgage
Loan and each Pipeline Loan, in each case as of the
Advance Date on which an Advance was made to fund the
origination or the purchase of the same hereunder or,
if later, the date on which a Solicitors Undertaking
re: New Mortgage Loans in respect thereof is issued,
as follows (but on the basis that each reference in
each representation and warranty to:-
(1) a Mortgage Loan shall be construed as a
reference to the relevant New Production
Mortgage Loan and/or Pipeline Loan; and
(ii) the Advance Date shall be construed as a
reference to whichever is the later of the
relevant Advance Date or the date on which the
relevant Solicitors Undertaking re. New
Mortgage Loans is given):
(1) The information set forth on the Mortgage
Loan Schedule with respect to each
Mortgage Loan is true and correct in all
material respects;
(2) Unless otherwise agreed from time to time
with respect to Non Performing Senior
Mortgage Loans and Non Performing Junior
Mortgage Loans, all payments due prior to
the Advance Date have been made and none
of the Mortgage Loans will have been
contractually delinquent for 31 or more
days more than once since the origination
thereof, the Lender hereby agreeing that
where the Mortgage Loan is funded
hereunder on its origination, this
warranty shall not apply;
(3) Each Mortgage Deed constitutes (i) in the
case of English Mortgage Loans, a valid
and enforceable legal mortgage of the
relevant Mortgaged Property subject only
in certain cases to registration of the
relevant Mortgage Deed at HM Land
Registry, or (ii) in the case of Scottish
Mortgage Loans, a valid and enforceable
Standard Security over the relevant
Mortgaged Property subject only in
certain cases to registration or
recording of the relevant Mortgage Deed
in the Registers of Scotland, in either
case duly executed by the Mortgagor named
in the relevant Mortgage Deed;
(4) On the date upon which an Advance is made
the Borrower (subject only to
registration of legal title at HM Land
Registry or the Registers of Scotland as
appropriate) has good title to each
Mortgage Loan and the Collateral Security
in respect of each such Mortgage Loan,
has full right and authority to charge
and assign the same by way of security
and the same is the absolute property of
the Borrower (subject to any registration
or recording in favour of the Borrower
which may be pending at
34
HM Land Registry or the Registers of
Scotland) free and clear of all
mortgages, securities, charges, liens,
encumbrances, claims and equities
(including, without limitation, rights of
set off or counterclaim, overriding
interest within the meaning of Section
3(xvi) of the Land Registration Xxx 0000
or Section 28(1) of the Land Registration
(Scotland) Act 1979 and adverse entries
or notices of application therefor
against any title at HM Registry or the
Registers of Scotland to any relevant
Mortgaged Property) except any such
encumbrances, claims, equities,
overriding interests or entries which
rank after the interests of the Borrower,
the Lender in the Mortgaged Loans or
which do not have an adverse effect on
the value of the relevant Mortgaged
Property as security for the relevant
Mortgage Loan or which are the subject of
a duly completed and signed Postponement
Agreement or appropriate executed MHA
Documentation as contemplated in
sub-clause (X) below;
(5) Each Mortgaged Property is a residential
property or mixed commercial and
residential property in the United
Kingdom;
(6) The steps necessary to perfect the
vesting of full legal and equitable title
to each Mortgage Loan and the Collateral
Security in the Borrower have been duly
taken at the appropriate time or are in
the course of being taken with all due
diligence;
(7) To the best of its knowledge, each
Mortgaged Property is free of material
damage;
(8) Each Mortgage Loan at origination
complied in all material respects with
applicable laws and regulations
including, where applicable, the Consumer
Credit Xxx 0000 and any regulations made
thereunder (and in particular no Mortgage
Loan is cancellable thereunder) and
consummation of the transactions
contemplated hereby will not involve the
violation of any such laws and
regulations;
(9) Neither it nor any prior holder of any
Mortgage Loan has; (a) modified the
Mortgage Loan in any material respect,
except that a Mortgage Loan may have been
modified by a written instrument in
respect of which any applicable
registration(s) have been completed; (b)
satisfied, cancelled or subordinated such
Mortgage Loan in whole or in part; (c)
released the related Mortgaged Property
in whole or in part from the security
created by the relevant Mortgage Deed; or
(d) executed any instrument of release,
cancellation, discharge, modification or
satisfaction with respect thereto;
35
(10) No sub-mortgage, sub-charge, pledge, lien
or right of set off or counterclaim or
other security interest or other adverse
right or interest has been created or has
arisen between it and any Mortgagor which
entitles or entitled the Mortgagor to
reduce the amount of any payment
otherwise due under the terms of such
Mortgagor's Mortgage Loan (save, in the
case of junior mortgages, the relevant
prior ranking legal mortgage or mortgages
of or Standard Security over the relevant
Mortgaged Property created by the
Mortgagor and any related security for
the loan secured thereby);
(11) Each Mortgage Loan was originated in all
material respects in accordance with the
criteria set out in the Underwriting
Guidelines;
(12) In relation to each Mortgaged Property:-
1) in respect of title to property in
England or Wales which is not
registered, the relevant Mortgagor
had or was acquiring good and
marketable title to the fee simple
absolute in possession (if freehold)
or a term of years absolute of not
less than thirty years beyond the
term of the Mortgage Loan (if
leasehold) relating to such
Mortgaged Property and is free from
any encumbrance which would
adversely affect such title;
2) in relation to title which is
registered at HM Registry, it was so
registered with title absolute in
the case of freehold property or
absolute leasehold or good leasehold
title of the requisite title
aforesaid in the case of leasehold
property;
3) in relation to which title is
registered or recorded in the
Registers of Scotland, it was so
registered or recorded with valid
and marketable title (whether feudal
or long lease), having in the case
of a long lease an unexpired term of
not less than thirty years beyond
the term of the Mortgage Loan;
4) no works on the relevant Mortgaged
Property were carried out in
violation of any applicable planning
law or regulation or building
regulations;
36
5) if the relevant Mortgaged Property
is leasehold or (in Scotland) held
under long lease, any requisite
consent of the landlord to or notice
to the landlord of the creation of
the relevant Mortgage had been
obtained or given and no consents of
or notices to such landlord are
required to any transfer,
assignation or sub-charge of the
relevant Mortgage, and a copy of any
such consent or notice is held with
the title deeds to the relevant
Mortgaged Property or held to the
order of the Lender or its
Solicitors;
6) the relevant Mortgaged Property is
not subject to any adverse third
party claim or proceeding for
compulsory acquisition thereof;
(13) Each Mortgage relating to a Mortgage Loan
(and any other documents entered into in
relation to the relevant Mortgage Loan)
is the legal, valid and binding
obligation of the grantor thereof,
enforceable in accordance with its terms
and with applicable laws and parties
thereto had legal capacity to execute the
same and the same have been duly and
properly executed by such parties;
(14) Either:
1) the proceeds of the Mortgage Loans
have been fully disbursed and there
is no requirement for further
advances thereunder; or
2) if any retention was recommended by
the Borrower or its valuer, the
recommendation to make a retention
was implemented and cash was not
advanced until the Borrower had
received a certificate (or other
evidence acceptable to it) of
completion of the relevant repairs
or other works.
(15) Each Mortgage Deed is in, or
substantially in, the form of the
relevant attachment annexed hereto in
Annexure 2 or as otherwise agreed and
approved by the Lender.
(16) The origination and underwriting
practices used by the Borrower with
respect to each Mortgage Loan have been
in all respects legal, proper, prudent
and customary in the mortgage servicing
business in the United Kingdom and comply
with the Underwriting Guidelines;
37
(17) Either:
1) each Mortgaged Property is insured
under the block insurance policy
from time to time maintained by the
Borrower to provide, where it is
agreed that the Mortgagor will not
insure, cover against such risks and
contingencies as are commonly
insured against in a fully
comprehensive buildings insurance
for residential properties to a
minimum of the full cost of
reinstatement thereof together with
inflation cost over any period that
may be required for obtaining any
relevant planning permission and
other approvals and the
reinstatement or repair period and
architects and other professional
fees; or
2) where the Mortgagor insures, the
Borrower has established that such
insurance was, at the date of
origination of the relevant Mortgage
Loan, in accordance with the
foregoing provisions of this
sub-clause, with a reputable
insurer, with an acknowledgement by
the insurer that the interest of the
Borrower has been or will be
promptly following the relevant
Advance Date noted on the relevant
policy. In the case of leasehold
property in England and Wales, the
relevant Mortgaged Property is
insured under arrangements effected
by the freeholder or any
intermediate leaseholder, on a fully
comprehensive basis as aforesaid.
(18) Prior to making the relevant advance the
subject of a Mortgage Loan, the Borrower
carried out or caused to be carried on
its behalf the investigations, searches
(other than local authority searches) and
other actions and made or caused to be
made on its behalf the enquiries as to
the Mortgagor's status that were required
in accordance with the relevant lending
criteria of the Borrower applicable at
the time when the offer of advance was
made and the results thereof were
acceptable to the Borrower in accordance
with such lending criteria for the
purposes of the proposed advance;
(19) Any further advances after the date of
the Mortgage Deed but made prior to the
Advance Date have been advanced under
separate mortgage documentation (and,
accordingly, have not been consolidated
with the outstanding principal amount
secured by the Mortgage), and all ground
rents, ground burdens and service charges
and other payments required in relation
to
38
leasehold property or heritable property
which previously became due and owing
have been paid. Except for interest
accruing from the date of the relevant
Mortgage Deed or date of advance to the
relevant Mortgagor, whichever is later,
to the day which precedes by one month
the date for payment of the first
installment of principal and interest,
the Borrower has not advanced funds, or
induced, solicited or knowingly received
any advance of funds by a party other
than the Mortgagor, directly or
indirectly, for the payment of any amount
in relation to the relevant Mortgage Loan
save to the extent that the same reduces
the Mortgage Loan;
(20) To the best of the Borrower's knowledge
and belief (the Borrower having made all
reasonable enquiries) there is no
default, breach, violation or event of
acceleration existing under any Mortgage
Loans and it has not waived any default,
breach, violation or event of
acceleration other than any waiver which
is in accordance with and permitted under
the relevant Manuals;
(21) Each Mortgage File contains a valuation
of the relevant Mortgaged Property
undertaken on the instructions of the
Borrower or instructions issued on its
behalf or as the case may be by any
predecessor in title in relation to the
relevant Mortgage Loan) by an independent
qualified valuer being an associate or
fellow of the Royal Institute of
Chartered Surveyors or, as the case may
be, Society of Valuers and Auctioneers,
in each case approved by the Borrower and
unless otherwise agreed between the
Lender and the Borrower, the principal
amount advanced to the relevant Mortgagor
was not more than the amount permissible
under the terms of the relevant Program;
(22) At the time of the making of the Mortgage
Loan, the Mortgaged Property was not
located within a 1 mile radius of any
contaminated land or any land with
environmental or hazardous waste risks
known to the Borrower or, where such was
the case, an environmental audit was
procured by the Borrower or evaluated in
accordance with its established
environmental review procedures, and
found to be satisfactory;
(23) In selecting the Mortgage Loans in
respect of which Advances are made
hereunder, no selection procedure was
employed by the Borrower which was
intended to adversely affect the
interests of the Lender;
39
(24) Prior to the making of the relevant
mortgage advance, enquiry was made of
each Mortgagor as to the identity of the
persons in actual occupation of the
Mortgaged Property and (i) in the case of
English Mortgage Loans, any person who at
the date when the advance was made had
attained the age of 18 and who was
identified in writing to the Borrower or
its Solicitor by the Mortgagor as
residing or being about to reside in the
relevant Mortgaged Property is either
named as joint mortgagor on the relevant
Mortgage Deed or has signed a legally
binding agreement postponing (each a
"POSTPONEMENT AGREEMENT") all rights and
entitlements to which such person may be
entitled in the Mortgaged Property to the
interests, rights and entitlements of the
Borrower or such other person as may have
or acquire as mortgagee or chargee of the
property from time to time, such
agreement in a form as was satisfactory
to such Solicitor, and (ii) in the case
of Scottish Mortgage Loans, prior to the
making of the advance, the Borrower or
its Solicitor obtained all necessary
validly executed MHA Documentation so as
to ensure that neither the relevant
Mortgage Loan nor the relevant Mortgaged
Property was subject to or affected by
any statutory right of occupancy in
favour of a non-entitled spouse;
(25) The Borrower has kept, or caused to be
kept, full and proper accounts, books and
records showing all transactions
payments, receipts and proceedings
relating to that Mortgage and all such
accounts, books and records are up to
date and in its possession or held to its
order;
(26) There exists no litigation, dispute or
complaint (subsisting or pending or
threatened) calling into question in any
way title of the Borrower to any Mortgage
Loan or, to the best of its knowledge,
the relevant Mortgagor's title to his
Mortgaged Property;
(27) The Mortgage Loan Documents are held to
the order of the Lender by the relevant
Solicitor or have been lodged at H.M.
Land Registry or the Registers of
Scotland and in the case of each
Mortgaged Property the title to which is
registered or for which application for
first registration has been made the
Borrower knows the title number under
which the Mortgaged Property is (or, in
the case of first registration, is to be)
registered at H.M. Land Registry or the
Registers of Scotland;
(28) In relation to each Mortgage Deed for
Mortgaged Property where registration is
pending at H.M. Land Registry, there is
no caution, notice or other entry which
would prevent the registration of the
Mortgage Deed as a charge by way of first
or, as the case may be, second or third
subsequent legal mortgage.
40
(29) None of the Mortgagors which pay interest
is a company.
14.5 It is acknowledged, that references in this clause 14 to Mortgage Loans
shall include reference to the relevant Collateral Security, as
appropriate.
15. REMEDIES FOR BREACH OF REPRESENTATIONS AND WARRANTIES
15.1 lt is understood and agreed that the representations and warranties set
forth in clauses 14.1, 14.2 and 14.4 shall survive the charging of
Mortgage Loans to the Lender and shall enure to the benefit of the
Lender notwithstanding the examination by the Lender or failure by the
Lender to examine any Mortgage File.
15.2 With respect to the representations and warranties contained in clauses
14.1. and 14.4 which are made to the best of the Borrower's (or OFC's)
knowledge, after reasonable inquiry and investigation, if it is
discovered by either the Borrower or OFC or the Lender that the
substance of such representation and warranty is inaccurate and in the
case of those in clause 14.4 such inaccuracy materially and adversely
affects the value of the related Mortgage Loan or the Lender's interest
in the Mortgage Loan then, notwithstanding the Borrower's (or OFC's)
lack of knowledge with respect to the inaccuracy at the time the
representation or warranty was made, the Lender shall have the same
rights in respect of the breach thereof as it would have if the
applicable representation or warranty was breached.
15.3 Upon discovery by OFC (but only with respect to the representation and
warranties made by OFC in clause 14.1) the Borrower or the Lender of a
breach of any of the foregoing representations and warranties
(a) given under clause 14.1; or
(b) given under clause 14.4 which materially and
adversely affects the value of the Mortgage Loans or
the interest of the Lender in the Mortgage Loan (or
which materially and adversely affects the interests
of the Lender in or to the related Mortgage Loan in
the case of a representation and warranty relating to
a particular Mortgage Loan)
the party discovering such breach shall give prompt written notice to
the other.
15.4 If following a review undertaken by the Lender within a period of 30
days after the date of any Revolving Advance, a material breach of the
warranties in clause 14.4 shall be discovered, the same shall
constitute a breach of such representation and warranty irrespective of
whether the same materially and adversely affects the value of the
relevant Mortgage Loan(s) provided that notice regarding such breach
shall have been delivered by the Lender to the Borrower promptly
following such review.
41
15.5 Within 60 days of the earlier of either discovery by or notice to the
Borrower of any breach of a representation or warranty given under
clause 14.4 which materially and adversely affects the value of any
Mortgage Loan, the Borrower shall use all reasonable endeavours
promptly to cure such breach and, if such breach cannot be cured or is
not cured at the end of such 60 day period or if it is determined at
any time following discovery or notice that such breach cannot be
cured, the Borrower shall:-
(1) repay the Advance (or such part thereof) made hereunder to
fund the relevant Mortgage Loan, together with accrued
interest thereon, on demand of the Lender; or
(2) with the Lender's prior consent provide additional collateral
of a type and amount reasonably acceptable to the Lender
(which may include Eligible Collateral Loans), charged in
favour of the Lender pursuant to such security documents as
shall be acceptable to the Lender;
and when the Borrower has repaid the Advance (or relevant part thereof)
under sub-clause 15.5(a) or provided additional collateral in
accordance with sub-clause 15.5(b) the Lender shall, at the cost of the
Borrower, release the relevant Mortgage Loan or Mortgage Loans from the
security constituted by the Debenture together with all Collateral
Security related thereto.
15.6 Without prejudice to the Lender's rights under clause 15.5(a), and for
such time as the Borrower's obligations thereunder shall remain
undischarged, the Lender shall be entitled to satisfy and discharge any
obligation it may have to make an Advance hereunder through set-off of
the Borrower's obligations to it under clause 15.5(a) and if the Lender
does so it shall be treated for all purposes as if it had satisfied its
obligation to make the relevant Advance through remittance of the
relevant funds in cash.
15.7 The Lender agrees that, in respect of breaches of warranty under clause
14.4 (but not under clause 14.1) its sole remedies shall be those
provided in this clause 15.
16. UNDERTAKINGS AND COVENANTS
16.1 The Borrower and (but only where the covenant or undertaking relates to
OFC) OFC hereby undertake with the Lender that from and after the date
hereof and until all sums due and to become due hereunder have been
paid or repaid in full and the Facility shall no longer exist:
42
(1) the Borrower and OFC shall obtain, comply with the terms of
and do all that is necessary to maintain in full force and
effect all authorisations, approvals, licenses and consents
required in or by the laws and regulations of England,
Scotland and (in the case of OFC) Florida to enable it
lawfully to enter into and perform its obligations under this
Agreement and each Transaction Document and to ensure the
legality, validity, enforceability or admissibility in
evidence in England and in Scotland of this Agreement and each
Transaction Document and shall ensure that none of the
foregoing are revoked or modified;
(2) the Borrower and OFC shall promptly inform the Lender of the
occurrence of any Event of Default or Potential Event of
Default and, upon receipt of a written request to that effect
from the Lender, confirm to the Lender that, save as
previously notified to the Lender or as notified in such
confirmation, no such event has occurred;
(3) the Borrower shall ensure that at all times the claims of the
Lender against it under this Agreement are secured as provided
in the Security Documents and that the security thereunder
will be of the nature and will rank in the priority it is
expressed to have in the Security Documents;
(4) the Borrower shall not, without the prior written consent of
the Lender, create or permit to subsist any Security over all
or any of its present or future revenues or assets save for
security created (or permitted) under the Security Documents;
(5) the Borrower shall not, without the prior written consent of
the Lender, make any loans, grant any credit or give any
guarantee or indemnity (except (i) as contemplated in the
Transaction Documents; or (ii) to OFC or any of its subsidiary
companies or affiliates) to or for the benefit of any person
or otherwise voluntarily assume any liability, whether actual
or contingent, in respect of any obligation of any other
person;
(6) the Borrower shall not, without the prior written consent of
the Lender, sell, lease, transfer or otherwise dispose of, by
one or more transactions or series of transactions (whether
related or not), the whole or any part of its revenues or its
assets except as permitted under the Debenture;
(7) the Borrower undertakes to continue to endeavour to settle all
matters outstanding and pending with the OFT from time to time
as expeditiously as reasonably practicable;
(8) the Borrower will procure that the origination of all New
Production Mortgage Loans and Pipeline Loans does not violate
in any material respect:-
(1) OFT Guidelines and;
43
(2) any undertakings or agreements from time to time
between the Borrower, any holding company or any
subsidiary of the Borrower and the OFT;
(9) the Borrower will procure that the Lender is promptly provided
with copies of any OFT related correspondence sent or received
on or after the date hereof provided that nothing in this or
any other undertaking shall entitle the Lender to receive
access to or copies of privileged correspondence between the
Borrower and its counsel;
(10) the Borrower will procure that all Mortgage Files are
delivered to Xxxxx Business Services Limited or such other
xxxxxx as the Lender may have approved (acting reasonably)
from time to time (subject always to clause 3.10(c) of the
Debenture) as soon as reasonably practicable following receipt
of the recorded deed and shall use reasonable endeavours to
procure that the Lender has, upon 1 Business Day's notice,
access to the offices of all Solicitors, Xxxxx Business
Services Limited or other storage provider aforesaid) during
normal business hours and shall procure that the Solicitors
are instructed to allow the Lender to take possession of any
Mortgage File in relation to any Mortgage Loan financed or to
be financed hereunder;
(11) all New Production Mortgage Loans will be originated and all
Pipeline Loans acquired have been originated in accordance
with the Underwriting Guidelines;
(12) the Borrower will not amend the Standard Documentation without
the prior written consent of the Lender;
(13) the Borrower shall deliver to the Lender as soon as the same
are available, and in any event within one hundred and twenty
(120) days after the end of each of its financial years a copy
of its audited annual financial statements;
(14) the Borrower shall provide the Lender promptly upon request
with any information relating to it and/or its financial
condition as the Lender may from time to time reasonably
require in connection with this Agreement;
(15) the Borrower shall ensure that each set of audited annual
financial statements delivered pursuant to sub-clause (m) are
prepared in accordance with generally accepted accounting
principles and on the same basis every year and half year
(save as may be required from time to time as a result of
changes in law or regulation or generally accepted accounting
principles);
(16) each of the Borrower and OFC shall, promptly upon receipt of
the same, deliver to the Lender a copy of any independent
accountants' management letters received by it relating to it;
44
(17) the legal and equitable title of each Existing Mortgage Loan
and New Production Mortgage Loan and Pipeline Loan financed
hereunder and not sold or otherwise disposed of (whether
through a securitisation, whole loan sale or otherwise) by the
Borrower will be held in the name of the Borrower;
(18) the Borrower shall procure that:
(1) the transfer to it of legal and equitable title to
all Existing Mortgage Loans pursuant to the Sale
Agreement is perfected in the name of the Borrower;
and
(2) the transfer to it of legal and equitable title to
any New Production Mortgage Loan the origination of
which is financed hereunder or to any Pipeline Loan
the acquisition of which is financed hereunder is
perfected in the name of the Borrower,
and shall procure that in each case all necessary steps are
undertaken to protect the Borrower's Security including as
appropriate registration of the relevant mortgages in the name
of the Borrower at HM Land Registry or Registers of Scotland
which registration shall be completed within 6 months from the
date of application to the relevant registry and will submit
each such application promptly (and within any applicable
priority time periods) and shall procure that the Solicitors
will comply with the Solicitors Undertakings and the Borrower
shall be responsible for and meet any registration fees and
other costs in connection therewith, provided that breach by
the Borrower of this provision in relation to any one or more
Existing Mortgage Loans, New Production Mortgage Loans or
Pipeline Loans shall not constitute an Event of Default but
shall entitle the Lender to require repayment of the Advance,
or part thereof, (and all interest accrued thereon) which
funded the acquisition of the relevant New Production Mortgage
Loan or Existing Mortgage Loan or Pipeline Loan against
release by the Lender of the relevant Mortgage Loan from the
security created by the Debenture;
(19) the Borrower shall procure that where any retention is made in
respect of a Mortgage Loan funded hereunder, the amount
retained is, pending advance of the same against the relevant
certificate (or other evidence) of completion of the relevant
works, held either in the Borrower Funding Account or with the
relevant Solicitor under the terms of the Solicitor's
Undertaking re: New Monies Advance.
16.2 The Borrower shall procure that the Servicer provides such certificates
as required by the Lender pursuant to the Servicing Agreement.
16.3 The Borrower shall, or shall procure that either the Servicer or the
Solicitors shall, within 5 days of the date hereof in relation to
Existing Mortgage Loans and within 5 days of the requisition of a
Pipeline Loan forward to the relevant Mortgagor and any other relevant
Mortgagee of a Mortgaged Property a notice of transfer in the form
approved in writing by the Lender.
45
16.4 The Borrower shall not originate any MIRAS loans without the prior
written consent of the Lender.
16.5 The Borrower shall, if required by the Lender give notice to Borrowers
requiring the Borrowers to redirect payment so as to pay direct to the
Borrower Collection Account, or such other account of the Borrower or
(following an Acceleration) such other Account as the Lender shall
specify.
16.6 The Borrower shall not be entitled, without the prior written consent
of the Lender, to give Notice to any Borrower requiring such Borrower
to redirect payments so as to make payments directly to any account
other than the relevant Collection Account, or other account to which
they are, at the relevant time, required to make such payments.
16.7 The Borrower shall procure, in so far as it is able to do so, that all
amounts payable under each Existing Mortgage Loan, New Production
Mortgage Loans and Pipeline Loans financed hereunder is, for so long as
it is so financed, paid by the relevant Mortgagor:
(1) to the relevant Collection Account until notice is given in
accordance with the Transaction Documents to any Mortgagor
requiring the relevant Mortgagor to pay all amounts under the
relevant Mortgage Loan directly to the Borrower Collection
Account, or other account specified in any such notice; and
(2) thereafter (save for amounts properly deducted therefrom by
the Servicer as permitted by the Servicing Agreement) directly
to the Borrower Collection Account or other account so
specified in such notice;
16.8 The Guarantor shall, for so long as this Agreement is in effect:
(a) maintain a minimum Consolidated Tangible Net Worth of
$320,000,000.00 (three hundred and twenty million United
States dollars);
(b) not permit the ratio of its Consolidated Indebtedness to
Consolidated Tangible Net Worth to exceed 12:1; and
(c) maintain liquid assets consisting of cash and cash equivalents
on an unconsolidated basis of not less than $15,000,000.00
(fifteen million United States dollars);
provided that if the Guarantor is or becomes obligated to another
creditor during the term of this Agreement to comply with financial
covenants of a type substantially similar to the foregoing but on terms
more favourable to such creditor, the Guarantor shall, so long as such
more favourable covenants shall be in effect, be obligated to comply
with such covenants as though set out in full herein.
46
16.9 The parties hereto covenant with each other to use reasonable best
endeavours to procure that a further loan facility (and associated
security and guarantee documentation) (the "New Facility") is entered
into between the Borrower, the Guarantor and Greenwich Capital
Financial Products Inc. or such other Greenwich entity (other than the
Lender) as is agreed between the parties (the "NEW LENDER") prior to
the Final Maturity Date, pursuant to which the New Facility would be
provided:-
(1) to refinance indebtedness under the Revolving Facility; and
(2) to refinance indebtedness under the Term Loan, but only until
the Term Loan Repayment Date,
on substantially the same terms and conditions as set out in the
Transaction Documents save that:-
(1) the Final Maturity Date (subject to extension in the
sole discretion of the Lender) of the revolving
facility thereunder shall be the day falling 364 days
after the date of this Agreement;
(2) the repayment date of the term loan thereunder shall
be the Term Loan Repayment Date; provided that the
repayment date for up to (pound sterling) 25,000,000
of the Term Loan may have a final maturity date of up
to 90 days beyond the Term Loan Repayment Date;
(3) the New Lender shall obtain to its satisfaction a
valid first priority Security interest in, to and
under, inter alia, the Scottish Mortgage Loans;
(4) the New Lender shall, at its option, either have
valid, first priority fixed Security over buildings
policies (including all block policies), contingency
policies, mortgage indemnity policies, life policies,
ASU policies and protected income cover policies
relating to the Mortgage Loans, or shall be named as
an additional assured in respect of its interest on
such policies, subject to such endorsements as the
Lender shall reasonably request; and
(5) under the New Facility up to 20% of the aggregate
credit available under the New Facility may be used
to fund in any combination:
(1) non performing mortgage loans provided such
loans have not been financed under this
Agreement and the New Facility (in the
aggregate) longer than 180 days; and
47
(2) performing mortgage loans which have been
financed under this Agreement and the New
Facility (in the aggregate) longer than 180
days, provided that such loans remain
performing and are removed from the facility
no later than the 270th day;
(6) except as provided in clause (ii) and (v) above, no
mortgage loan may be funded under this Agreement and
the New Facility (in the aggregate) longer than 180
days;
(7) from a date to be mutually agreed advances under the
revolving facility may only be made once a week on
Business Days during the Availability Period.
In the event that a New Facility is entered into the Borrower will
procure that the Mortgage Loans are serviced for the duration of such
facility by the Servicer (or other servicer acceptable to the Lender
and the Borrower in accordance with clause 16.9 of the Servicing
Agreement) pursuant to a servicing agreement on substantially the same
terms as those under the Servicing Agreement.
17. DEFAULT
17.1 In the event of:-
(1) any default by the Borrower in the payment of any amount due
for payment hereunder or under any Transaction Document within
two Business Days after receipt of written notice by the
Lender requiring payment of the same; or
(2) the Borrower failing to observe or perform any other
covenants, obligations or agreements of the Borrower under
this Agreement or any Transaction Document which, if (in the
good faith opinion of the Lender) capable of remedy shall not
have been remedied (to the satisfaction of the Lender) within
thirty days of being required by the Lender to do so; or
(3) any representation or warranty made or repeated by the
Borrower under this Agreement (other than any representation
or warranty made or deemed to be made pursuant to clause 14.4)
or under any other Transaction Document or any representation
and warranty made or repeated by OFC hereunder being or
proving to be or have been untrue or incorrect or misleading
in any material respect as at the date at which it was made or
repeated, and in the case of any such breach which is (in the
good faith opinion of the Lender) capable of remedy, the
relevant breach not having been remedied within thirty days of
the Lender requiring the Borrower or, as the case may be, OFC
to do so; or
(4) any default by OFC in the payment of any amount due for
payment hereunder or under the Indemnity on the due date
therefor; or
48
(5) OFC failing to observe or perform any other covenant,
obligation or agreement contained hereunder or in the
Indemnity which, if (in the good faith opinion of the Lender)
is capable of remedy has not been remedied (to the
satisfaction of the Lender) within thirty days of the Lender
requiring OFC to do so; or
(6) the Servicing Agreement being terminated, or becoming capable
of being terminated (after expiration of any applicable grace
periods) in accordance with its terms other than by reason of
a Disposal that by its terms is conditional upon a release of
servicing in respect of such Mortgage Loans; or
(7) OFC or the Servicer failing to observe or perform any material
covenant, obligation or agreement (including any obligation to
make any payment) on its part to be observed or performed
under any Transaction Document (other than, in the case of
OFC, this Agreement, or the Indemnity and, in the case of the
Servicer the Servicing Agreement) which is (in the good faith
opinion of the Lender) capable of remedy shall not have been
remedied (to the satisfaction of the Lender) within thirty
days (or such shorter or longer grace period as may apply in
respect of the relevant breach under the relevant Transaction
Document) of the Lender requiring remedy of the same; or
(8) any representation or warranty made or repeated by OFC or the
Servicer under any Transaction Document (other than, in the
case of OFC, this Agreement and the Indemnity and in the case
of the Servicer, the Servicing Agreement) being or becoming
untrue or misleading as of the date on which made or repeated
and, in the case of any such breach which is (in the good
faith opinion of the Lender) capable of remedy, the relevant
breach not having been remedied to the satisfaction of the
Lender within thirty days (or such shorter or longer grace
period as may apply in respect of the relevant breach under
the relevant Transaction Document) of the Lender requiring OFC
or the Servicer, as the case may be, to do so; or
(9) the loss by the Borrower or the Servicer of its Consumer
Credit Act License; or
(10) an adverse determination being made by the OFT in respect of
any Minded to Revoke Notice served by the OFT on any of the
Borrower or the Servicer in respect of the Consumer Credit Act
License of the Borrower or the Servicer irrespective of any
right to appeal (or other right) which the Borrower, or the
Servicer may have thereafter, a "determination" being the
decision or determination made by the Director (as defined
under the CCA) under section 34(3) CCA in respect of the
relevant Minded to Revoke Notice; or
(11) an injunction or interdict (which relates to its residential
mortgage lending business including, without limitation,
Mortgage Loans financed hereunder) being obtained by (or on
behalf of) the OFT against the Servicer or the Borrower which
remains in effect for more than 60 days;
49
(12) an order being made or an effective resolution being passed
for winding up of the Borrower, the Servicer or OFC or any
analogous provision or order being made under any applicable
jurisdiction; or
(13) the Borrower, the Servicer or OFC ceasing or threatening to
cease to carry on business or a substantial part of such
business or stopping payment or threatening to stop payment of
its debts or being or becoming unable to pay its debts within
the meaning of Section 123(1)(a), (b), (c) or (d) of the
Insolvency Xxx 0000, as that section may be amended, (or as
the case may be any analogous provision under any applicable
jurisdiction) or otherwise becoming unable to pay its debts as
they fall due or the value of its assets falling to less than
the amount of its liabilities (taking into account for both
these purposes its contingent and prospective liabilities) or
the Borrower, the Servicer or OFC otherwise becoming
insolvent;
(14) proceedings being initiated against the Borrower, the Servicer
or OFC under any applicable liquidation, insolvency,
composition, bankruptcy, reorganisation (other than a
reorganisation the terms of which have been approved by the
Lender and where the Borrower, the Servicer or OFC is solvent)
or other similar laws, or a petition for an administration
order being presented against the Borrower, or the Servicer or
OFC or an administrative or other receiver, administrator or
other similar official in any applicable jurisdiction being
appointed in relation to the Borrower, or the Servicer or OFC
or in relation to the whole or any substantial part of the
undertaking of or assets of the Borrower, or the Servicer or
OFC or an encumbrancer taking possession of the whole or any
substantial part of the undertaking or assets of the Borrower,
or the Servicer or OFC or a distress, diligence or execution
or other process being levied or enforced upon or sued out
against the whole or any substantial part of the undertaking
or assets of the Borrower, or the Servicer or OFC or the
Borrower, or the Servicer or OFC initiating or consenting to
judicial proceedings relating to itself under any applicable
liquidation, insolvency, composition, reorganisation or other
similar laws or making a conveyance or assignment for the
benefit of its creditors generally; or
(15) any material adverse change in the condition (financial,
business, prospects or otherwise) of any of the Borrower or
OFC occurring, which, in the reasonable judgment of the Lender
is reasonably likely to prevent the Borrower or OFC, as the
case may be, from performing its respective material
obligations under any Transaction Document or is likely to
adversely affect the value (to the Lender) of its security
whether by adversely affecting the value of such security, the
prospects of a sale thereof or otherwise; or
50
(16) the Borrower ceasing to be a wholly owned subsidiary of the
Guarantor; or
(17) any Indebtedness, arising under any one or more transactions
of the Guarantor and/or the Borrower, in excess (in aggregate)
of $5,000,000 or the equivalent thereof in any other currency
(determined by translating the other currency into dollars at
the mean of National Westminster Bank Plc's spot buying and
selling rates (based on the market rates prevailing at the
relevant time) for the exchange of dollars and such currency
at the relevant time):-
(1) not being paid on its due date or within any
applicable grace period; or
(2) if payable on demand, not being paid on demand or
within any applicable grace period; or
(3) becoming due by reason of a declared (or automatic)
event of default (howsoever described) prior to its
original maturity date and not being paid within 5
days of its required date of payment.
(each of the foregoing an "EVENT OF DEFAULT"), the Lender may, for so
long as such event is continuing unwaived by the Lender do each or any
of the following:
(i) declare, by notice in writing to the Borrower, any
undrawn portion of the Revolving Commitment or any of
it to be no longer available to the Borrower; and/or
(ii) declare, by written notice to the Borrower, all
Advances outstanding together with all interest
accrued thereon and all other sums then due and
outstanding hereunder from the Borrower to be
immediately due and payable, whereupon the same shall
become immediately due and payable; and/or
(iii) enforce all or any of its security under the Security
Documents; and/or
(iv) terminate the Servicing Agreement pursuant to its
terms; and/or
(v) terminate this Agreement,
whereupon the Lender shall cease to be obliged to make Advances
hereunder.
17.2 If any Advance shall be declared immediately due and payable as
aforesaid, the Borrower shall pay to the Lender such amount as the
Lender certifies to be necessary to compensate it for any loss incurred
(excluding loss of Margin) or to be incurred on account of deposits
acquired or arranged in order to fund such Advances as a consequence of
such Event of Default.
51
17.3 The rights conferred on the Lender pursuant to this clause 17 shall be
in addition to whatever rights the Lender may have both at law and in
equity.
17.4 The Lender may waive any default by the Borrower in the performance of
its obligations hereunder and its consequences. Upon any such waiver of
a past default, such default shall cease to exist, and any Event of
Default arising therefrom shall be deemed to have been remedied for
every purpose of this Agreement. No such waiver shall extend to any
subsequent or other default or impair any right consequent thereon
except to the extent expressly so waived.
17.5 The Borrower agrees to indemnify and keep indemnified the Lender from
and against any loss, cost (including any cost of enforcement),
liability (including any tax liability), claim or damage which the
Lender incurs or suffers as a consequence of the occurrence of any
Event of Default and the indemnity may, without limiting the Lender's
rights, be claimed as a debt or liquidated demand. 1.1
18. DEFAULT INTEREST
18.1 If any sum due and payable by the Borrower hereunder is not paid on the
due date therefor or if any sum due and payable by the Borrower under
any judgement or decree of any court in connection herewith is not paid
on the date of such judgement or decree, the period beginning on the
date seven days after such due date (in the case of non payment by the
Borrower of an amount due hereunder) or, as the case may be, the date
of such judgement or decree and ending on the date upon which the
obligation of the Borrower to pay such sum (the balance thereof for the
time being unpaid being herein referred to as an "UNPAID SUM") is
discharged shall be divided into successive periods, each of which
(other than the first) shall start on the last day of the preceding
such period and the duration of each of which shall (except as
otherwise provided in this clause 18) be selected by the Lender.
18.2 During each such period relating thereto as is mentioned in clause 18.1
an unpaid sum shall bear interest at the rate per annum which is the
sum from time to time of two per cent and the Margin in respect thereof
at such time and LIBOR on the first day of the relevant period provided
that:
(1) if, for any such period, LIBOR cannot be determined, the rate
of interest applicable to such unpaid sum shall be the rate
per annum which is the sum of two per cent and the Margin in
respect thereof at such time and the rate per annum determined
by the Lender to be equal to the rate which express as a
percentage rate per annum equals the cost to it of funding
such unpaid sum for such period from whatever sources it may
select; and
(2) if such unpaid sum is all or part of an Advance which became
due and payable on a day other than the Repayment Date
therefor, the first such period applicable thereto shall be of
a duration equal to the unexpired portion of that Term and the
rate of interest applicable thereto from time to time during
such period shall be that which exceeds by two per cent the
rate which would have been applicable to it had it not so
fallen due.
52
18.3 Any interest which shall have accrued under clause 18 in respect of an
unpaid sum shall be due and payable and shall be paid by the Borrower
at the end of the period by reference to which it is calculated or on
such other dates as the Lender may specify by written notice to the
Borrower.
19. CALCULATIONS
19.1 The Borrower shall, for each Interest Payment Date, calculate the
Borrowing Base Deficiency for that date such calculation to be done as
soon as possible after the applicable Determination Date and in any
event no later than the third Business Day prior to the Interest
Payment Date in question and shall notify the same to the Lender,
immediately upon calculation of the same.
19.2 The Lender shall, for the purposes of the calculation under clause
19.1, notify the Borrower of the fair market value of all Existing
Mortgage Loans, New Production Mortgage Loans and Pipeline Loans
financed under this Agreement which have not, at the relevant time,
been sold or otherwise disposed of by the Borrower, as determined by
the Lender in good faith.
19.3 The Lender's determination of the matters to be notified to the
Borrower under clause 19.2 shall, in the absence of manifest error or
bad faith, be final and binding on the parties hereto.
19.4 The Borrower's determination of the Borrowing Base Deficiency once
agreed by the Lender under clause 19.5 shall, in the absence of
manifest error or bad faith (on the part of either party), be final and
binding on the parties hereto.
19.5 The Lender shall use reasonable endeavours to agree the Borrower's
determinations of the Borrowing Base Deficiency within three Business
Days of notification of the same to the Lender.
20. CURRENCY OF ACCOUNT
20.1 Sterling is the currency of account and payment for each and every sum
at any time due from the Borrower hereunder provided that each payment
in respect of costs and expenses shall be made in the currency in which
the same were incurred.
20.2 If any sum due from the Borrower under this Agreement or any order or
judgement given or made in relation hereto has to be converted from the
currency (the "FIRST CURRENCY") in which the same is payable hereunder
or under such order, decree or judgement into another currency (the
"SECOND CURRENCY") for the purpose of (a) making or filing a claim or
proof against the Borrower, (b) obtaining an order, decree or judgement
in any court or other tribunal or (c) enforcing any order, decree or
53
judgement given or made in relation hereto, the Borrower shall
indemnify and hold harmless each of the persons to whom such sum is due
from and against any loss suffered as a result of any discrepancy
between (i) the rate of exchange used for such purpose to convert the
sum in question from the first currency into the second currency and
(ii) the rate or rates of exchange at which such person may in the
ordinary course of business purchase the first currency with the second
currency upon receipt of a sum paid to it in satisfaction, in whole or
in part, of any such order, judgement, decree, claim or proof.
21. SET-OFF
21.1 The Borrower authorizes the Lender to apply any credit balance to which
the Borrower is entitled on any account of the Borrower with the Lender
in satisfaction of any sum due and payable from the Borrower to the
Lender hereunder but unpaid.
21.2 All payments required to be made by the Borrower hereunder shall be
calculated without reference to any set-off, deduction or counterclaim
and shall be made free and clear of and without any deduction for or on
account of any set-off, deduction or counterclaim.
22. CALCULATION OF INTEREST
23.1 Interest shall accrue from day to day and shall be calculated on the
basis of a year of 365 days and the actual number of days elapsed.
23. COSTS AND EXPENSES
23.1 The Borrower shall, save where expressed to the contrary in any other
Transaction Document, from time to time on demand of the Lender,
reimburse the Lender for all reasonable costs and expenses (including
legal fees) together with any VAT thereon incurred by it in connection
with the negotiation, preparation and execution of this Agreement, the
Transaction Documents and the completion of the transactions pursuant
to this Agreement or the Transaction Documents or in connection with
the preservation and/or enforcement of any of the rights of the Lender
under this Agreement and the Transaction Documents.
23.2 The Borrower shall pay all stamp, registration and similar taxes to
which this Agreement or any judgement or decree given in connection
herewith is or at any time may be subject (including in relation to the
perfection of security granted by the Security Documents) and shall,
from time to time on demand of the Lender, indemnify the Lender against
any liabilities, costs, claims and expenses resulting from any failure
to pay or any delay in paying any such tax.
23.3 The Borrower shall, from time to time on demand of the Lender
compensate the Lender at such daily and/or hourly rates as the Lender
shall from time to time reasonably determine for the time and
expenditure, all costs and expenses (including
54
telephone, fax, copying, travel and personnel costs) incurred by the
Lender in connection with its taking such action as it may deem
appropriate or in complying with any request by the Borrower in
connection with (a) the granting or proposed granting of any waiver or
consent requested hereunder by the Borrower; (b) any actual, potential
or reasonably suspected breach by the Borrower of its obligations
hereunder; (c) the occurrence of any event which is an Event of Default
or a Potential Event of Default; or (d) any amendment or proposed
amendment hereto requested by the Borrower.
24. REMEDIES AND WAIVERS
No failure to exercise, nor any delay in exercising, on the part of the
Lender, any right or remedy hereunder shall operate as a waiver
thereof, nor shall any single or partial exercise of any right or
remedy prevent any further or other exercise thereof or the exercise of
any other right or remedy. Save as otherwise expressly provided herein
the rights and remedies herein provided are cumulative and not
exclusive of any rights or remedies provided by law.
25. CONFIDENTIALITY
The Borrower shall not, without the prior written consent of the
Lender, disclose to any person the existence or any details concerning
the Transaction Documents except to the extent such disclosure is
contemplated in any Transaction Document, or is required pursuant to
the application of any applicable law or an order of a court of
competent jurisdiction, or is made to the Borrower's auditors or other
professional advisors who are subject to confidentiality restrictions
imposed by a professional body which are substantially similar to those
set forth above.
26. NOTICES
26.1 ADDRESSES
Any notice or other communication or document to be made or delivered
under this Agreement shall be made or delivered by fax or otherwise in
writing. Each notice, communication or other document to be delivered
to any party to this Agreement shall (unless that other person has by
fifteen days' written notice to the other party specified another
address or fax number) be made or delivered to that person at the
address(es) or fax number (if any) set out below:-
(a) in the case of the Lender to their branch office in the United
Kingdom, facsimile number: 0171 375 5510, attention Xxxx
Xxxxxxxx with a simultaneous copy to the office of the General
Counsel located at 000 Xxxxxxxxx Xxxx, Xxxxxxxxx, Xxxxxxxxxxx
00000, XXX, facsimile number: 001 203 629 4571, attention
General Counsel;
(b) in the case of the Borrower, to its offices at 00-00
Xxxxxxxxxxx Xxxxx, Xxxxxx XX0X 0XX facsimile number: 0171 831
9152, care of Edge & Xxxxxxx;
55
(c) in the case of OFC, to its offices at:
The Forum
0000 Xxxx Xxxxx Xxxxx Xxxxxxxxx
Xxxxx 0000
Xxxx Xxxx Xxxxx, Xxxxxxx 00000
Attention: Xxxx X. Xxxxx, Corporate Secretary
Telephone No.: 000-000-0000
Telefax No.: 000-000-0000
With a copy to:
Xxxx Xxxxx
Company Secretary
Ocwen Financial Corporation
The Forum
1675 Palm Beach Xxxxx Xxxxxxxxx
Xxxxx 0000
Xxxx Xxxx Xxxxx, Xxxxxxx 00000
Telephone No.: 000-000-0000
Telefax No.: 000-000-0000
26.2 DEEMED DELIVERY
Any notice, communication or document to be delivered to any person
shall be deemed to have been delivered:-
(1) in the case of personal delivery, at the time of such
delivery;
(2) in the case of delivery by post, on the business day following
the day on which it was posted and in proving such delivery it
shall be sufficient to prove that the relevant notice,
communication or document was properly addressed, stamped and
posted (by airmail, if to another country) in the United
Kingdom or, in the case of service to or from an address
outside the United Kingdom at 9.00 a.m. on the fourth day
following the day on which it was posted;
(3) in the case of any notice or other communication by fax, (a)
on the business day the same was transmitted so long as there
is evidence that such fax message was received prior to 5.00
p.m. local time of the recipient on such day and such day is a
business day for the recipient, otherwise (b) on the business
day following the day on which it was transmitted and, in
either case, in proving such delivery it shall be sufficient
to prove that the whole of the fax message was received on any
fax machine of the recipient and that there was no evidence
that such transmission had been interrupted.
56
27. SEVERABILITY
If at any time any provision of this Agreement is or becomes illegal,
invalid or unenforceable in any respect under the law of any
jurisdiction, that shall not affect or impair:-
(1) the legality, validity or enforceability in that jurisdiction
of any other provision of this Agreement; or
(2) the legality, validity or enforceability under the law of any
other jurisdiction of that or any other provision of this
Agreement.
28. ASSIGNMENT
28.1 The Lender may at any time:-
(1) sub-participate any part (but not the whole) of its rights or
benefits under this Agreement provided that at any time no
more than 51% of its rights and benefits hereunder may be
sub-participated; and
(2) assign or transfer any part (but not the whole) of its rights
or benefits under this Agreement provided that at any time, no
more than 51% of its rights and benefits may be assigned or
transferred so as to be held by a person other than the Lender
and provided further that:-
(1) if such assignment or transfer is to any person other
than a subsidiary, holding company of or other member
of the Lender's group such assignment or transfer
shall require the prior consent of the Borrower (such
consent not to be unreasonably withheld); and
(2) if, at the time and as a result of any proposed
transfer or assignment, the Borrower would incur any
increased cost or be liable to make payments in
excess of those required to be made hereunder
immediately prior thereto (other than any minimum
liquid asset costs) such assignment or transfer is on
terms that the Borrower is not and will not be liable
for any such increased cost or liability.
28.2 The Borrower shall not be entitled to assign, transfer or otherwise
dispose of all or any of its rights or benefits under this Agreement
without the prior written consent of the Lender.
28.3 The Lender may disclose to a proposed assignee, transferee or
sub-participant information in its possession relating to the
provisions of this Agreement and the Transaction Documents which it
considers necessary or desirable to disclose for the purposes of the
proposed assignment, transfer or sub-participation, notwithstanding the
provisions of clause 25 (Confidentiality) provided that the Lender
obtains from such assignee, transferee or sub-participant a
confidentiality undertaking on substantially the same terms as clause
25 (but substituting references to such proposed assignee, transferee
or sub-participant for references therein to the Borrower) or on such
other terms as may be agreed between the Borrower and the Lender.
57
28.4 This Agreement shall bind and inure to the benefit of and be
enforceable by the Lender and its respective successors, transferees
and assigns and references to the Lender shall be deemed to include
references to each of the foregoing.
29. FURTHER ASSURANCE
The Borrower shall, from time to time on being required to do so by the
Lender, now or at any time in the future, do or procure the doing of
all such acts and/or execute or procure the execution of all such
documents in a form satisfactory to the Lender as the Lender may
consider necessary for giving full effect to this Agreement and the
Transaction Documents and securing to the Lender the full benefit of
the rights, powers and remedies conferred upon the Lender in this
Agreement or any Transaction Documents.
30. ENTIRE AGREEMENT
This Agreement (together with the Transaction Documents entered into on
or after the date hereof) constitutes the whole and only agreement
between the parties relating to the secured, guaranteed facility
provided by the Lender to the Borrower described herein and supersedes
and extinguishes any prior drafts, agreements, undertakings,
representations, warranties and arrangements of any nature whatsoever,
including without limitation the "secured loan facility" described in
the commitment letter between OFC and Greenwich Capital Markets Inc
dated 31 March 1998.
31. AGENT FOR SERVICE
31.1 OFC irrevocably agrees that any Service Document may be sufficiently
and effectively served on it in connection with Proceedings, whether
pursuant to this Agreement or any other Transaction Document, in
England and Wales by service on its agent Ocwen Limited, if no
replacement agent has been appointed and notified to the Lender
pursuant to sub-clause 31.4, or on the replacement agent if one has
been appointed and notified to the Lender.
31.2 Any Service Document served pursuant to this clause shall be marked for
the attention of:
(a) Ocwen Limited (care of Edge & Xxxxxxx) at 00 Xxxxxxxxxxx
Xxxxx, Xxxxxx, XX0X 0XX or such other address within England
and Wales as may be notified to the Lender by OFC; or
58
(b) such other person as is appointed as agent for service
pursuant to sub-clause 31.4 at the address notified pursuant
to sub-clause 31.4.
31.3 Any document addressed in accordance with sub-clause 30.2 shall be
deemed to have been duly served if:-
(a) left at the specified address, when it is left; or
(b) sent by first class post, two clear Business Days after the
date of posting.
31.4 If the agent referred to in sub-clause 31.4 (or any replacement agent
appointed pursuant to this sub-clause) at any time ceases for any
reason to act as such, OFC shall appoint a replacement agent to accept
service having an address for service in England or Wales and shall
notify the Lender of the name and address of the replacement agent;
failing such appointment and notification, the Lender shall be entitled
by notice to OFC to appoint such a replacement agent to act on OFC's
behalf.
31.5 A copy of any Service Document served on an agent pursuant to this
clause shall be sent by post to OFC at its address for the time being
for the service of notices and other communications under clause 26
(Notices), but no failure or delay in so doing shall prejudice the
effectiveness of service of the Service Document in accordance with the
provisions of sub-clause 31.1.
31.6 Each of OFC and the Lender irrevocably consent to the service of
process of any of the aforesaid courts in Submitted States in any such
action or Proceeding by the mailing of copies thereof by registered or
certified mail, postage prepaid to the party's notice address specified
above, such service to become effective upon receipt of evidence of the
receipt thereof.
59
32. GOVERNING LAW AND JURISDICTION
32.1 This Agreement shall be governed by and construed in accordance with
the laws of England.
32.2 The parties to this Agreement irrevocably agree that the courts of
England are to have jurisdiction to settle any dispute which may arise
out of or in connection with this Agreement and each other Transaction
Document and that accordingly any proceeding, suit, or action arising
out of or in connection with this Agreement or any other Transaction
Document ("Proceedings") may be brought in such courts.
32.3 Without prejudice to sub-Clause 32.2, all the parties further
irrevocably agree that any Proceedings may be brought in any court of
the State of New York, or the State of Florida or any other state of
the United States, where any party has its chief executive office (all
of such states being the "Submitted States") or federal court sitting
in the Submitted State and any court having jurisdiction over appeals
of matters heard in such courts and each of the parties hereto
irrevocably submits to the non-exclusive jurisdiction of such courts.
32.4 Each of the parties hereto irrevocably waives any objection it may have
now or hereafter to the laying of the venue of any Proceedings in any
such court as is referred to in this clause and any claim of FORUM NON
CONVENIENS and further irrevocably agrees that a judgment in any
Proceedings brought in any court referred to in this clause shall be
conclusive and binding upon it and may be enforced in the courts of any
other jurisdiction.
IN WITNESS WHEREOF, this Agreement is duly executed the date and year first
above written at London.
/s/ XXXXXX X. XXXXXXXXX
--------------------------------------
for and on behalf of
OCWEN LIMITED
Witness /s/ XXXXXXXX XXXXX
--------------------------------------
Occupation. Xxxxxxxx Xxxxx - Solicitor
Address: Edge & Xxxxxxx
00/00 Xxxxxxxxxxx Xxxxx
Xxxxxx XX0X 0XX
60
/s/ XXXX X. XXXXXXXX
--------------------------------------
for and on behalf of GREENWICH
INTERNATIONAL, LTD.
Witness /s/ XXXXXXXX XXXXX
--------------------------------------
Occupation. Xxxxxxxx Xxxxx - Solicitor
Address: Edge & Xxxxxxx
00/00 Xxxxxxxxxxx Xxxxx
Xxxxxx XX0X 0XX
/s/ XXXXXX X. XXXXXXXXX
--------------------------------------
for and on behalf of OCWEN FINANCIAL CORPORATION
Witness /s/ XXXXXXXX XXXXX
--------------------------------------
Occupation. Xxxxxxxx Xxxxx - Solicitor
Address: Edge & Xxxxxxx
00/00 Xxxxxxxxxxx Xxxxx
Xxxxxx XX0X 0XX
61
The following schedules have been omitted from this filing, but copies thereof
are available to the Commission upon request:
SCHEDULE 1 FORM OF DRAWDOWN REQUEST(INITIAL ADVANCE)
FORM OF DRAWDOWN REQUEST(REVOLVING ADVANCES)
SCHEDULE 2 FORM OF SOLVENCY CERTIFICATE
SCHEDULE 3 MORTGAGE LOAN DOCUMENTS
SCHEDULE 4 PART I
62
SCHEDULE 4
PART II
(1) The information set forth on the Mortgage Loan Schedule with
respect to each Mortgage Loan is true and correct in all
material respects;
(2) Unless otherwise agreed from time to time, all payments due
prior to the Advance Date have been made and none of the
Mortgage Loans will have been contractually delinquent for 31
or more days more than once since the origination thereof;
(3) Each Mortgage Deed constitutes (i) in the case of English
Mortgage Loans, a valid and enforceable legal mortgage of the
relevant Mortgaged Property subject only in certain cases to
registration of the relevant Mortgage Deed at HM Land
Registry, or (ii) in the case of Scottish Mortgage Loans, a
valid and enforceable Standard Security over the relevant
Mortgaged Property subject only in certain cases to
registration or recording of the relevant Mortgage Deed in the
Registers of Scotland, in either case duly executed by the
Mortgagor named in the relevant Mortgage Deed;
(4) On the date upon which an Advance is made the Borrower
(subject only to registration of legal title at HM Land
Registry or the Registers of Scotland as appropriate) has good
title to each Mortgage Loan and the Collateral Security in
respect of each such Mortgage Loan, has full right and
authority to charge and assign the same by way of security and
the same is the absolute property of the Borrower (subject to
any registration or recording in favour of the Borrower which
may be pending at HM Land Registry or the Registers of
Scotland) free and clear of all mortgages, securities,
charges, liens, encumbrances, claims and equities (including,
without limitation, rights of set off or counterclaim,
overriding interest within the meaning of Section 3(xvi) of
the Land Registration Xxx 0000 or Section 28(1) of the Land
Registration (Scotland) Act 1979 and adverse entries or
notices of application therefor against any title at HM
Registry or the Registers of Scotland to any relevant
Mortgaged Property) except any such encumbrances, claims,
equities, overriding interests or entries which rank after the
interests of the Borrower, the Lender in the Mortgaged Loans
or which do not have an adverse effect on the value of the
relevant Mortgaged Property as security for the relevant
Mortgage Loan or which are the subject of a duly completed and
signed Postponement Agreement or appropriate executed MHA
Documentation as contemplated in sub-clause 14.3(B)(2) below;
63
(5) Each Mortgaged Property is a residential property or mixed
commercial and residential property in the United Kingdom;
(6) The steps necessary to perfect the vesting of full legal and
equitable title to each Mortgage Loan and the Collateral
Security in the Borrower have been duly taken at the
appropriate time or are in the course of being taken with all
due diligence;
(7) To the best of its knowledge, each Mortgaged Property is free
of material damage;
(8) Each Mortgage Loan at origination complied in all material
respects with applicable laws and regulations including, where
applicable, the Consumer Credit Xxx 0000 and any regulations
made thereunder (and in particular no Mortgage Loan is
cancellable thereunder) and consummation of the transactions
contemplated hereby will not involve the violation of any such
laws and regulations;
(9) Neither it nor any prior holder of any Mortgage Loan has; (a)
modified the Mortgage Loan in any material respect, except
that a Mortgage Loan may have been modified by a written
instrument in respect of which any applicable registration(s)
have been completed; (b) satisfied, cancelled or subordinated
such Mortgage Loan in whole or in part; (c) released the
related Mortgaged Property in whole or in part from the
security created by the relevant Mortgage Deed; or (d)
executed any instrument of release, cancellation, discharge,
modification or satisfaction with respect thereto;
(10) No sub-mortgage, sub-charge, pledge, lien or right of set off
or counterclaim or other security interest or other adverse
right or interest has been created or has arisen between it
and any Mortgagor which entitles or entitled the Mortgagor to
reduce the amount of any payment otherwise due under the terms
of such Mortgagor's Mortgage Loan (save, in the case of junior
mortgages, the relevant prior ranking legal mortgage or
mortgages of or Standard Security over the relevant Mortgaged
Property created by the Mortgagor and any related security for
the loan secured thereby);
(11) Each Mortgage Loan was originated in all material respects in
accordance with the criteria set out in the Underwriting
Guidelines;
(12) In relation to each Mortgaged Property:-
(1) in respect of title to property in England or Wales
which is not registered, the relevant Mortgagor had
or was acquiring good and marketable title to the fee
simple absolute in possession (if freehold) or a term
of years absolute of not less than thirty years
beyond the term of the Mortgage Loan (if leasehold)
relating to such Mortgaged Property and is free from
any encumbrance which would adversely affect such
title;
64
(2) in relation to title which is registered at HM
Registry, it was so registered with title absolute in
the case of freehold property or absolute leasehold
or good leasehold title of the requisite title
aforesaid in the case of leasehold property;
(3) in relation to which title is registered or recorded
in the Registers of Scotland, it was so registered or
recorded with valid and marketable title (whether
feudal or long lease), having in the case of a long
lease an unexpired term of not less than thirty years
beyond the term of the Mortgage Loan;
(4) no works on the relevant Mortgaged Property were
carried out in violation of any applicable planning
law or regulation or building regulations;
(5) if the relevant Mortgaged Property is leasehold or
(in Scotland) held under long lease, any requisite
consent of the landlord to or notice to the landlord
of the creation of the relevant Mortgage had been
obtained or given and no consents of or notices to
such landlord are required to any transfer,
assignation or sub-charge of the relevant Mortgage,
and a copy of any such consent or notice is held with
the title deeds to the relevant Mortgaged Property or
held to the order of the Lender or its Solicitors;
(6) the relevant Mortgaged Property is not subject to any
adverse third party claim or proceeding for
compulsory acquisition thereof;
(13) Each Mortgage relating to a Mortgage Loan (and any other
documents entered into in relation to the relevant Mortgage
Loan) is the legal, valid and binding obligation of the
grantor thereof, enforceable in accordance with its terms and
with applicable laws and parties thereto had legal capacity to
execute the same and the same have been duly and properly
executed by such parties;
(14) Either:
(1) the proceeds of the Mortgage Loans have been fully
disbursed and there is no requirement for further
advances thereunder; or
(2) if any retention was recommended by CMC's or the
relevant Approved Affiliate's valuer, the
recommendation to make a retention was implemented
and cash was not advanced until CMC or relevant
Approved Affiliate had received a certificate (or
other evidence acceptable to it) of completion of the
relevant repairs or other works.
65
(15) Each Mortgage Deed is in, or substantially in, the form of the
relevant attachment annexed hereto in Annexure 2.
(16) The origination and underwriting practices used by CMC or
relevant Approved Affiliate or with respect to each Mortgage
Loan have been in all respects legal, proper, prudent and
customary in the mortgage servicing business in the United
Kingdom and comply with the Underwriting Guidelines;
(17) Either:
(1) each Mortgaged Property is insured under the block
insurance policy from time to time maintained by CMC
or, as the case may be, the relevant Approved
Affiliate to provide, where it is agreed that the
Mortgagor will not insure, cover against such risks
and contingencies as are commonly insured against in
a fully comprehensive buildings insurance for
residential properties to a minimum of the full cost
of reinstatement thereof together with inflation cost
over any period that may be required for obtaining
any relevant planning permission and other approvals
and the reinstatement or repair period and architects
and other professional fees; or
(2) where the Mortgagor insures, CMC or, as the case may
be, the relevant Approved Affiliate has established
that such insurance was, at the date of origination
of the relevant Mortgage Loan, in accordance with the
foregoing provisions of this sub-clause, with a
reputable insurer, with an acknowledgement by the
insurer that the interest of CMC or relevant Approved
Affiliate has been or will be promptly following the
relevant Advance Date be noted on the relevant
policy. In the case of leasehold property in England
and Wales, the relevant Mortgaged Property is insured
under arrangements effected by the freeholder or any
intermediate leaseholder, on a fully comprehensive
basis as aforesaid.
(18) Prior to making the relevant advance the subject of a Mortgage
Loan, CMC or the relevant Approved Affiliate (as originator)
carried out or caused to be carried on its behalf the
investigations, searches (other than local authority searches)
and other actions and made or caused to be made on its behalf
the enquiries as to the Mortgagor's status that were required
in accordance with the relevant lending criteria of CMC or the
Approved Affiliate or Relevant Affiliate (as originator)
applicable at the time when the offer of advance was made and
the results thereof were acceptable to CMC or the relevant
Approved Affiliate or Relevant Affiliate (as originator) in
accordance with such lending criteria for the purposes of the
proposed advance;
66
(19) Any further advances after the date of the Mortgage Deed but
made prior to the Advance Date have been advanced under
separate mortgage documentation (and, accordingly, have not
been consolidated with the outstanding principal amount
secured by the Mortgage), and all ground rents, ground burdens
and service charges and other payments required in relation to
leasehold property or heritable property which previously
became due and owing have been paid. Except for interest
accruing from the date of the relevant Mortgage Deed or date
of advance to the relevant Mortgagor, whichever is later, to
the day which precedes by one month the date for payment of
the first installment of principal and interest, none of CMC,
the Approved Affiliate or Relevant Affiliate (as originator)
has advanced funds, or induced, solicited or knowingly
received any advance of funds by a party other than the
Mortgagor, directly or indirectly, for the payment of any
amount in relation to the relevant Mortgage Loan save to the
extent that the same reduces the Mortgage Loan;
(20) Subject to clause 14.3(B), to the best of the Borrower's
knowledge and belief (the Borrower having made all reasonable
enquiries of CMC or relevant Originator) there is no default,
breach, violation or event of acceleration existing under any
Mortgage Loan: and neither CMC nor any Approved Affiliate (as
originator) has waived any default, breach, violation or event
of acceleration other than any waiver which is in accordance
with and permitted under the relevant Manuals;
(21) Each Mortgage File contains a valuation of the relevant
Mortgaged Property undertaken on the instructions of CMC, the
relevant Approved Affiliate or Relevant Affiliate (as
originator), or instructions issued on its behalf or as the
case may be by any predecessor in title in relation to the
relevant Mortgage Loan) by an independent qualified valuer
being an associate or fellow of the Royal Institute of
Chartered Surveyors or, as the case may be, Society of Valuers
and Auctioneers, in each case approved by CMC, the relevant
Approved Affiliate or Relevant Affiliate (as originator) and
unless otherwise agreed between the Lender and the Borrower,
the principal amount advanced to the relevant Mortgagor was
not more than the amount permissible under the terms of the
relevant Program;
(22) At the time of the making of the Mortgage Loan, the Mortgaged
Property was not located within a 1 mile radius of any
contaminated land or any land with environmental or hazardous
waste risks known to CMC or the relevant Approved Affiliate or
(as originator) or, where such was the case, an environmental
audit was procured by CMC or the relevant Approved Affiliate
or (as originator) or evaluated in accordance with such
relevant originator's established environmental review
procedures, and found to be satisfactory;
67
(23) In selecting the Mortgage Loans in respect of which Advances
are made hereunder, no selection procedure was employed by the
Borrower which was intended to adversely affect the interests
of the Lender;
(24) Prior to the making of the relevant mortgage advance, enquiry
was made of each Mortgagor as to the identity of the persons
in actual occupation of the Mortgaged Property and (i) in the
case of English Mortgage Loans, any person who at the date
when the advance was made had attained the age of 18 and who
was identified in writing to CMC, the relevant Approved
Affiliate (as originator) or its Solicitor by the Mortgagor as
residing or being about to reside in the relevant Mortgaged
Property is either named as joint mortgagor on the relevant
Mortgage Deed or has signed a legally binding agreement
postponing (each a "POSTPONEMENT AGREEMENT") all rights and
entitlements to which such person may be entitled in the
Mortgaged Property to the interests, rights and entitlements
of CMC or the relevant Approved Affiliate (as originator) or
such other person as may have or acquire as mortgagee or
chargee of the property from time to time, such agreement in a
form as was satisfactory to such Solicitor, and (ii) in the
case of Scottish Mortgage Loans, prior to the making of the
advance, CMC or the relevant Approved Affiliate (as
originator) or its Solicitor obtained all necessary validly
executed MHA Documentation so as to ensure that neither the
relevant Mortgage Loan nor the relevant Mortgaged Property was
subject to or affected by any statutory right of occupancy in
favour of a non-entitled spouse;
(25) CMC and each Approved Affiliate have kept, or caused to be
kept, full and proper accounts, books and records showing all
transactions payments, receipts and proceedings relating to
that Mortgage and all such accounts, books and records are up
to date and in its possession or held to its order;
(26) There exists no litigation, dispute or complaint (subsisting
or pending or threatened) calling into question in any way
title of CMC or any Approved Affiliate to any Mortgage Loan
or, to the best of its knowledge, the relevant Mortgagor's
title to his Mortgaged Property;
(27) The Mortgage Loan Documents are held to the order of the
Lender by the relevant Solicitor or have been lodged at H.M.
Land Registry or the Registers of Scotland and in the case of
each Mortgaged Property the title to which is registered or
for which application for first registration has been made the
Borrower knows the title number under which the Mortgaged
Property is (or, in the case of first registration, is to be)
registered at H.M. Land Registry or the Registers of Scotland;
(28) In relation to each Mortgage Deed for Mortgaged Property where
registration is pending at H.M. Land Registry, there is no
caution, notice or other entry which would prevent the
registration of the Mortgage Deed as a charge by way of first
or, as the case may be, second or third subsequent legal
mortgage.
(29) None of the Mortgagors which pay interest is a company.
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