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LOAN AGREEMENT, dated as of March 14, 1997 (as amended, modified or
supplemented from time to time, this "AGREEMENT"), among HOMESIDE LENDING, INC.,
a Florida corporation (the "BORROWER"), and XXXXXXX XXXXX MORTGAGE CAPITAL INC.,
a Delaware corporation (the "LENDER"), and THE CHASE MANHATTAN BANK, as
Collateral Agent hereunder (in such capacity, the "COLLATERAL AGENT") and as
"Lender" under the Chase Agreement (as defined below).
The parties hereto hereby agree as follows:
1. DEFINED TERMS. As used in this Agreement, capitalized terms
defined in the Credit Agreement (as defined below) and not otherwise defined
herein have the meanings given in the Credit Agreement, or in the case of
paragraph 4 hereof and the definition of Collateral below, the HomeSide Security
Agreement (as such terms are modified in such paragraph and such definition),
and the following terms have the meanings specified below:
"Chase" means The Chase Manhattan Bank, a New York banking corporation.
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"CHASE AGREEMENT" means the Loan Agreement, dated as of January 15,
1997, between the Borrower and Chase, as the same has been and may be amended,
supplemented or modified from time to time.
"CHASE COLLATERAL" means "Collateral" under and as defined in the Chase
Agreement.
"CHASE OBLIGATIONS" means all "Obligations" under and as defined in the
Chase Agreement.
"CREDIT AGREEMENT" means (i) the Amended and Restated Credit Agreement,
dated as of January 31, 1997, among (a) the Borrower, (b) Honolulu Mortgage
Company, Inc., (c) the lenders and agents parties thereto, (d) the Lenders from
time to time designated as Balance Lenders thereunder, (e) The First National
Bank of Boston, as Collateral Agent, (f) NationsBank of Texas, N.A., as
Syndication Agent, (g) the Senior Managing Agent, Managing Agents and Co- Agents
and (h) Chase, as Administrative Agent, and (ii) any credit agreement which
amends and restates or otherwise replaces the Credit Agreement referred to in
clause (i) above, in each case as the same may be amended, modified or
supplemented from time to time.
"COLLATERAL" means (i) Servicing Rights, (ii) Servicing Contracts,
(iii) rights to receive payments in connection with Servicing Contracts and
Servicing Rights, whether on account of the performance of services, upon the
termination of Servicing Rights, Servicing Contracts or otherwise (including,
without limitation, all Eligible Servicing Receivables (and all deeds,
contracts, agreements, instruments of title and other documents received or
receivable in respect thereof)), (iv) rights with respect to the placement of
escrow deposits associated with such Servicing Rights and Servicing Contracts
and all rights to the payment of money or provision of concessions or services
with respect thereto, (v) those Mortgage Loans owned by the Borrower and
described on Schedule II hereto, and (vi) all Proceeds of each of the foregoing,
PROVIDED that the foregoing term "Servicing Contracts" shall have the meaning
ascribed thereto in the
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HomeSide Security Agreement, but only in reference to the contracts listed on
Schedule I hereto, and the foregoing terms "Servicing Rights" and "Eligible
Servicing Receivables" shall have the meanings ascribed thereto in the HomeSide
Security Agreement to the extent, and as if, such terms and the items described
in such terms related only to such Servicing Contracts as defined above.
"HOMESIDE SECURITY AGREEMENT" means the HomeSide Security Agreement (as
defined in the Credit Agreement) and any security agreement which amends and
restates or otherwise replaces such HomeSide Security Agreement under the Credit
Agreement, in each case as the same may be amended, modified or supplemented
from time to time.
"OBLIGATIONS" means the unpaid principal of and interest on the Loans
and the Note and all other obligations and liabilities of the Borrower to the
Lender (including, without limitation, interest accruing at the then applicable
rate provided in the Note after the maturity of the Loans and interest accruing
at the then applicable rate provided in the Note after the filing of any
petition in bankruptcy, or the commencement of any insolvency, reorganization or
like proceeding, relating to the Borrower, whether or not a claim for
post-filing or post-petition interest is allowed in such proceeding), whether
direct or indirect, absolute or contingent, due or to become due, or now
existing or hereafter incurred, which may arise under, out of, or in connection
with, this Agreement, the Loans, the Note, or any other document made, delivered
or given in connection therewith, in each case whether on account of principal,
interest, fees, indemnities, costs, expenses or otherwise (including, without
limitation, all fees and disbursements of counsel to the Lender that are
required to be paid by the Borrower pursuant to the terms of this Agreement).
2. AMOUNT AND TERMS OF LOANS. Subject to the terms and conditions
hereof and so long as no Event of Default (as defined herein) has occurred and
in continuing, the Lender agrees to make revolving credit loans (the "LOANS") to
the Borrower from time to time during the period from the Initial Loan Date (as
defined below), through but not including the Maturity Date (as defined in the
Note) in an aggregate principal amount not to exceed $35,000,000 outstanding at
any time. The Loans shall be evidenced by a promissory note (the "NOTE") of the
Borrower, substantially in the form of Exhibit A, to be executed and delivered
to the Lender on the Initial Loan Date. The Borrower hereby unconditionally
promises to pay to the Lender the then unpaid principal amount of the Loans
outstanding on the Maturity Date (or the then unpaid principal amount of the
Loans on the date that the Loans become due and payable pursuant to paragraph
5). The Borrower hereby further agrees to pay interest on the unpaid principal
amount of the Loans from time to time outstanding from the Initial Loan Date
until payment in full thereof at the rate per annum, and on the dates, set forth
in the Note. The Loans may be borrowed on any Business Day upon notice to the
Lender prior to 2:00 P.M. New York City times on the date of such borrowing
(which such notice shall be accompanied by such information regarding the value
of the Collateral as shall be requested by the Lender) and may be prepaid at any
time with out premium or penalty.
3. COVENANTS. The Borrower hereby covenants and agrees that, so
long as any amount is outstanding or unpaid hereunder under the Note, the
Borrower shall comply with all
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the covenants and agreement set forth in Section 7 and Section 8 of the Credit
Agreement, and such provisions of the Credit Agreement (other than Section 8.3,
8.9 and 8.11 thereof) are incorporated herein by reference, MUTATIS MUTANDIS,
PROVIDED that (i) all references therein to the "Administrative Agent" or
"Lenders" shall be deemed to refer to the Lender and (ii) such other
modifications thereto shall be deemed made as are necessary to effectuate the
intent of the parties hereunder.
4. COLLATERAL; SECURITY AGREEMENT. As collateral security for the
full and prompt payment when due (whether at stated maturity, by acceleration or
otherwise) of, and the performance of, all the Obligations and to induce the
Lender to make the Loans, (i) the Borrower hereby assigns, conveys, mortgages,
pledges, hypothecates and transfers to the Collateral Agent, for the benefit of
the Lender, and hereby grants to the Collateral Agent, for the benefit of the
Lender, a security interest in, all of the Borrower's rights, title and interest
in, to and under the Collateral, and (ii) the Borrower hereby assigns, conveys,
mortgages, pledges, hypothecates and transfers to the Collateral Agent, for the
benefit of the Lender, and hereby grants to the Collateral Agent, for the
benefit of the Lender, a second priority security interest in, all of the
Borrower's right, title and interest in, to and under the Chase Collateral,
which security interest shall be subject to the prior rights of Chase therein
under the Chase Agreement, as further described in paragraph 5(b) hereof. In
addition, as collateral security for the full and prompt payment when due
(whether at stated maturity, by acceleration or otherwise) of, and the
performance of, all the Chase Obligations and to induce Chase to agree to the
provisions hereof and to make further Loans under the Chase Agreement, the
Borrower hereby assigns, conveys, mortgages, pledges, hypothecates and transfers
to the Collateral Agent, for the benefit of Chase, and hereby grants to the
Collateral Agent, for the benefit of Chase, a second priority security interest
shall be subject to the prior rights of the Lender therein under this Agreement,
as further described in paragraph 5(b) hereof. All provisions of the HomeSide
Security Agreement are incorporated by reference herein, MUTATIS MUTANDIS, to
the extent applicable to any of the Collateral as defined above, and the
Borrower agrees, covenants and makes representations and warranties herein as
set forth therein, PROVIDED that (i) all references therein related to items of
type included in such Collateral shall be deemed to refer only to such items
included in or related to such Collateral, and the terms defined therein and
referred to in the definition of Collateral herein shall be modified as set
forth in such definition, (ii) all references therein to the "Collateral Agent"
or "Administrative Agent" shall be deemed to refer the Collateral Agent as
defined herein, and all references therein to "Lenders" shall be deemed to refer
to the Lender and Chase, (iii) all references therein to "Grantor" shall be
deemed to refer to the Lender and Chase, (iii) all references therein to
"Grantor" shall be deemed to refer to the Borrower, (iv) provisions solely
relating to items of Collateral under (and as defined in) the HomeSide Security
Agreement that are not included in the definition of Collateral above shall be
disregarded for purposes hereof and (v) such other modifications thereto shall
be deemed made as are necessary to effectuate the intent of the parties
hereunder. Without limiting the foregoing, the Collateral Agent, Chase and the
Lender shall have all rights and remedies of a secured party in respect of the
Collateral as provided under the Uniform Commercial Code in effect in the State
of New York from time to time.
5. EVENTS OF DEFAULT, REMEDIES; COLLATERAL AGENT. (a) If (i) the
Borrower shall fail to pay any principal of the Loans when due in accordance
with the terms hereof and of the Note, or
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(ii) the Borrower shall fail to pay any interest on the Loans, or any other
amount payable hereunder or under the Note, within five days after any such
interest or other amount becomes due in accordance with the terms thereof or
hereof, or (iii) any representations or warranty made or deemed made by the
Borrower herein or in any document delivered by the Borrower in connection
herewith or which is contained in any certificate, document or financial or
other statement furnished by it at any time under or in connection with this
Agreement or any such other document shall prove to have been incorrect in any
material respect on or as of the date made or deemed made, and the facts or
circumstances in respect of which such representation or warranty was incorrect
have not changed to make such representation or warranty correct within 30 days
after it was made, or (iv) any Event of Default under (and as defined in) the
Credit Agreement shall occur and be continuing, or (v) at any time (A) the
aggregate value that would be attributable to the Collateral and the Chase
Collateral as a component of the HomeSide Tranche A Borrowing Base or the
HomeSide Tranche B Borrowing Base, as the case may be, if calculated pursuant to
the advance rates set forth in Section 4.1 and 4.2 of the Credit Agreement (but
without regard to any characteristics of such Collateral or Chase Collateral
that have been disclosed to Chase and Xxxxxxx on or before the date hereof as
characteristics existing on the date hereof that make such assets ineligible for
inclusion in the applicable borrowing bases under the Credit Agreement) is less
than (B) the aggregate principal amount of loans, outstanding at such time under
this Agreement and the Chase Agreement, then, and in any such event, (A) if such
event is an Event of Default specified in clause (i) or (ii) of paragraph (f) of
Section 9 of the Credit Agreement, automatically the commitment of the Lender to
make Loans hereunder shall be terminated and the Loans (with accrued interest
thereon) and all other amounts owing under this Agreement and the Note shall
immediately become due and payable, (B) if such event is any other default
described in clause (i), (ii), (iii), or (iv) above, the Lender may by notice to
the Borrower declare the commitment of the Lender to make Loans hereunder to be
terminated and the Loans (with accrued interest thereon) and all other amounts
owing under this Agreement and the Note to be due and payable forthwith,
whereupon the same shall immediately become due and payable, and (C) the
Collateral Agent, for the benefit of Chase and the Lender, shall have such
remedies with respect to the Collateral as are set forth in the HomeSide
Security Agreement (as incorporated and modified pursuant to the definition of
the term "Collateral" and paragraph 4 hereof).
(b) Chase hereby agrees that the security interest of the Lender in the
Collateral shall have priority over the interest granted to Chase hereunder in
the Collateral, and any rights of Chase to such Collateral or any proceeds
thereof, or any remedies in respect thereof, shall be subject to the prior
satisfaction in full of the Obligations. The Lender hereby agrees that the
security interest of Chase in the Chase Collateral shall have priority over the
interest granted to the Lender hereunder in the Chase Collateral, and any rights
of the Lender to such Chase Collateral or any proceeds thereof, or any remedies
in respect thereof, shall be
subject to the prior satisfaction in full of the Chase Obligations. Any money,
property or securities realized upon the sale, disposition or other realization
by the Collateral Agent upon all or any part of the Collateral, shall be applied
by the Collateral Agent FIRST, to the payment in full of all costs and expenses
(including, without limitation, attorneys' fees and disbursements) paid or
incurred by the Collateral Agent or the Lender in connection with such
realization on the
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Collateral or the protection of their rights and interests therein; SECOND, to
the payment in full of all Obligations; THIRD, to the payment in full of all
Chase Obligations; and FOURTH, to pay to the Borrower or its respective
representatives or as a court of competent jurisdiction may direct, any surplus
then remaining. Any money, property or securities realized upon the sale,
disposition or other realization by the Collateral Agent upon all or any part of
the Chase Collateral, shall be applied by the Collateral Agent FIRST, to the
payment in full of all costs and expenses (including, without limitation,
attorneys' fees and disbursements) paid or incurred by the Collateral Agent or
Chase in connection with such realization on the Chase Collateral or the
protection of their rights and interests therein; SECOND, to the payment in full
of all Chase Obligations; THIRD, to the payment in full of all Obligations; and
FOURTH, to pay to the Borrower or its respective representatives or as a court
of competent jurisdiction may direct, any surplus then remaining.
(c) The Lender and Chase hereby appoint Chase as Collateral Agent
hereunder for the purpose of carrying out the terms of this Agreement with
respect to the Collateral and the Chase Collateral, and authorize Chase in such
capacity to take any and all appropriate action and to execute any and all
documents and instruments which may be necessary or desirable to accomplish the
purposes of this paragraph, including, without limitation, any financing
statements, endorsements, assignments or other instruments of transfer or
release. The Lender waives any claim it might have against Chase as Collateral
Agent with respect to, or arising out of, any action or failure to act or any
error of judgment or negligence on the part of Chase or its respective
directors, officers, employees or agents with respect to any exercise of rights
or remedies relating to the Collateral or the Chase Collateral. Neither Chase
nor any of its respective directors, officers, employees or agents shall be
liable for failure to demand, collect or realize upon any of the Collateral or
the Chase Collateral or for any delay in doing so or shall be under any
obligation to sell or otherwise dispose of any Collateral or Chase Collateral
upon the request of the Lender or any other Person or to take any other action
whatsoever with regard to the Collateral or Chase Collateral or any part
thereof.
6. PAYMENT OF EXPENSES. The Borrower agrees (a) to pay or
reimburse the Lender for all of its out-of-pocket costs and expenses incurred in
connection with the development, preparation and execution of, and any
amendment, supplement or modification to, this Agreement and the Note and any
other documents prepared in connection herewith or therewith, and the
consummation and administration of the transactions contemplated hereby and
thereby, including, without limitation, the reasonable fees and disbursements of
counsel to the Lender, (b) to pay or reimburse the Lender for all its costs and
expenses incurred in connection with the enforcement or preservation of any
rights under this Agreement, the Note and any such other documents, including,
without limitation, the fees and disbursements of counsel to the Lender, (c) to
pay, indemnify, and hold the Lender harmless from, any and all recording and
filing fees and any and all liabilities with respect to, or resulting from any
delay in paying, stamp, excise and other taxes, if any, which may be payable or
determined to be payable in connection with the execution and delivery of, or
consummation or administration of any of the transactions contemplated by, or
any amendment, supplement or modification of, or any waiver or consent under or
in respect of, this Agreement, the Note and any such other documents, and (d) to
pay, indemnify, and hold the Lender harmless from and against any and all other
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses or
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disbursements of any kind or nature whatsoever with respect to the execution,
delivery, enforcement, performance and administration of this Agreement, the
Note and any such other documents (all the foregoing in this clause (d),
collectively, the "indemnified liabilities"), PROVIDED that the Borrower shall
have no obligation hereunder to the Lender with respect to indemnified
liabilities arising from the gross negligence or willful misconduct of the
Lender. The agreements in this subsection shall survive repayment of the Loans
and all other amounts payable hereunder.
7. REPRESENTATIONS; NO DEFAULT. On and as of the date hereof, the
Borrower confirms, reaffirms and restates that the representations and
warranties set forth in Section 5 of the Credit Agreement are true and correct
in all material respects, PROVIDED, that the references to the Credit Agreement
therein shall be deemed to be references to this Agreement and the Note. Each
request by the Borrower that a Loan be made hereunder, and each borrowing
thereof, shall constitute a representation and warranty by the Borrower on the
date thereof that all such representations and warranties set forth in the
preceding sentence are true and correct in all material respects as if made on
such date.
8. CONDITIONS TO EFFECTIVENESS. This Agreement shall be
considered effective as of the date on which the Lender receives (i) the Note,
duly executed and delivered by a duly authorized officer of each of the
Borrower, (ii) such instruments and documents as the Lender requests in
connection with the Collateral and the security interest therein granted
hereunder, including executed Uniform Commercial Code filings in proper form for
filing and acknowledgment agreements relating thereto in form and substance
satisfactory to the Lender, (iii) such opinions of counsel to the Borrower as
the Lender shall request and certified copies of the resolutions of the Board of
Directors of the Borrower authorizing this Agreement and the borrowings and
security interests contemplated hereby, and (iv) evidence satisfactory to it
that the Borrower has taken all actions necessary to provide the Lender with a
perfected, first priority security interest in such Collateral.
9. COUNTERPARTS. This Agreement may be executed by one or more of
the parties hereto in any number of separate counterparts and all of said
counterparts taken together shall be deemed to constitute one and the same
instrument.
10. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
11. SUBMISSION TO JURISDICTION; WAIVERS. The Borrower hereby
irrevocably and unconditionally (a) submits for itself and its property in any
legal action or proceeding relating to this Agreement and the Note, or for
recognition and enforcement of any judgment in respect thereof, to the
non-exclusive general jurisdiction of the Courts of the State of New York, the
courts of the United States of America for the Southern District of New York,
and appellate courts from any thereof, (b) consents that any such action or
proceeding may be brought in such courts and waives any objection that it may
now or hereafter have to the venue of any such action or proceeding in any such
court or that such action or proceeding was brought in an inconvenient
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court and agrees not to plead or claim the same, (c) agrees that service of
process in any such action or proceeding may be effected by mailing a copy
thereof by registered or certified mail (or any substantially similar form of
mail), postage prepaid, to the Borrower at its address set forth in subsection
11.2 of the Credit Agreement or at such other address of which the Lender shall
have been notified pursuant thereto, (d) agrees that nothing herein shall affect
the right to effect service of process in any other manner permitted by law or
shall limit the right to xxx in any other jurisdiction, and (e) waives, to the
maximum extent not prohibited by law, any right it may have to claim or recover
in any legal action or proceeding referred to in this subsection any special,
exemplary, punitive or consequential damages.
12. WAIVERS OF JURY TRIAL. THE BORROWER AND THE LENDER HEREBY
IRREVOCABLY AND UNCONDITIONALLY WAIVE TRIAL BY JURY IN ANY LEGAL ACTION OR
PROCEEDING RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT AND FOR ANY
COUNTERCLAIM THEREIN.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed and delivered by their respective duly authorized officers as of the
date first above written.
HOMESIDE LENDING, INC.
By: /s/ Xxxxx X. Xxxxxxx
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Title: Senior Vice President
XXXXXXX XXXXX MORTGAGE
CAPITAL, INC.
By:
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Title: Director
THE CHASE MANHATTAN BANK, as
Lender under the Chase Agreement and as
Collateral Agent hereunder
By: /s/ P.A. Xxxxxx
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Title: Vice President
