Exhibit 10.83
SECOND AMENDED AND RESTATED INTERCREDITOR AGREEMENT
(Bear Xxxxxxx)
SECOND AMENDED AND RESTATED INTERCREDITOR AGREEMENT, dated as
of November 10, 1999, between IMC MORTGAGE COMPANY, a Florida corporation (the
"Company"), GREENWICH STREET CAPITAL PARTNERS II, L.P., a Delaware limited
partnership ("GSCP"), GREENWICH FUND, L.P., a Delaware limited partnership, GSCP
OFFSHORE FUND, L.P., a Cayman Islands exempted limited partnership, GREENWICH
STREET EMPLOYEES FUND, L.P., a Delaware limited partnership, TRV EXECUTIVE FUND,
L.P., a Delaware limited partnership (each a "Facility Lender" and collectively,
the "Facility Lenders" or the "GSCP Funds"), and BEAR XXXXXXX HOME EQUITY TRUST
("BSTrust"), BEAR, XXXXXXX INTERNATIONAL LIMITED ("BSIL"), and any of their
affiliates which are or become party to the Institutional Account Agreement (as
hereinafter defined). BSTrust, BSIL and any such affiliates are referred to
herein collectively as "Bear Xxxxxxx". Capitalized terms used in this Agreement
without definition have the meanings given to them in the Loan Agreement (as
hereinafter defined) as such terms are defined in the Loan Agreement on the date
hereof (or as amended by any amendment thereto approved by Bear Xxxxxxx).
RECITALS
A. The Company has entered into a Loan Agreement, dated as of
October 12, 1998, amended by Amendment No. 1 thereto, dated as of February 11,
1999 (as the same may be further modified, supplemented or restated from time to
time, the "Loan Agreement"), between the Company, as borrower, and the Facility
Lenders, pursuant to which the Facility Lenders have extended to the Company
loans, in the aggregate principal amount of $38,000,000 (the "Loans"), subject
to the terms and conditions set forth in the Loan Agreement, which Loans are
evidenced by the Notes and entitled to the benefit of certain guarantees and
security provided to the Facility Lenders or to GSCP, as collateral agent (the
"Collateral Agent") under certain of the other Loan Documents.
B. The Facility Lenders have made certain additional loans to
the Company pursuant to Note Purchase and Amendment Agreement No. 6, dated as of
October 18, 1999, in the original principal amount of $61,500,000 (the "Facility
Lender Advances") to fund certain monthly delinquent interest servicing advances
in respect of the Company's securitizations.
C. Pursuant to (a) a Master Repurchase Agreement, dated as of
March 29, 1996, as amended from time to time, by and among BSTrust, the Company
and certain of the Company's Subsidiaries (the "Whole Loan Repurchase
Agreement"), and other related agreements with BSTrust (collectively with the
Whole Loan Repurchase Agreement, the "Whole Loan Repurchase Documents"); (b) the
Master Repurchase Agreement, dated as of May 1, 1997, as amended from time to
time (together with annexes, confirmations and transactions thereunder,
collectively the "Residuals Repurchase Agreement") between BSIL and Industry
Mortgage Company, L.P., the predecessor to the Company ("IMCLP"); and (c) the
Institutional Account Agreement, dated October 23, 1996, as amended from to
time, between and among IMCLP and Bear Xxxxxxx (the "Institutional Account
Agreement"; and together with the Whole Loan Repurchase Agreement, the Whole
Loan Repurchase Documents and the Residuals Repurchase Agreement, collectively,
the "Existing Agreements"), BSTrust and BSIL have entered into transactions with
the Company from time to time, pursuant to which the Company has sold mortgage
loans to BSTrust and securities to BSIL, in each case subject to an obligation
to repurchase such assets and for other purposes provided therein; and the
Company and certain of its Subsidiaries have granted to BSTrust and BSIL a
security interest in the Collateral (as hereinafter defined) in order to secure
the respective obligations of the Company and the Subsidiaries under the
Existing Agreements (the "Existing Obligations").
D. The Company entered into an Acquisition Agreement (the
"Acquisition Agreement"), dated as of February 19, 1999, by and among each of
the GSCP Funds and the Company, pursuant to which the Company would issue and
deliver to the GSCP Funds common stock, par value $0.001 per share, of the
Company representing approximately 93.5% of the Common Stock outstanding after
such issuance.
E. The Company has (i) terminated the Acquisition Agreement
and (ii) entered into an Asset Purchase Agreement, dated as of July 13, 1999, as
amended by Addendum No. 1 thereto, dated September 7, 1999 and a Delinquency and
Servicing Advance Purchase Agreement (collectively, the "Asset Purchase
Agreement"), between the Company and CitiFinancial Mortgage Company, a Delaware
corporation ("CMC"), pursuant to which CMC would acquire certain assets and
assume certain liabilities of the Company
(the "Asset Sale").
F. The Company, the Facility Lenders and Bear Xxxxxxx have
previously entered into an Intercreditor Agreement, dated as of October 12,
1998, amended and restated by the Amended and Restated Intercreditor Agreement,
dated as of February 18, 1999 and amended further by Amendment No. 1 to Amended
and Restated Intercreditor Agreements, dated as of March 31, 1999, and letter
agreements, dated as of July 15, 1999, August 11, 1999, September 14, 1999 and
October 15, 1999 (as so amended and restated, the "Original Intercreditor
Agreement"). In connection with the entry by the Company into and the
consummation of the Asset Purchase Agreement, the Facility Lenders, the Company,
and Bear Xxxxxxx have agreed to enter into this agreement amending and restating
the Original Intercreditor Agreement (as so amended and restated, the
"Agreement").
G. The Company issued a Promissory Note, dated as of July 1,
1997, in the amount of $12,975,864.30 (as amended and including any additional
Promissory Notes delivered pursuant to the Xxxxxxxx Intercreditor Agreement
(defined below), the "NH Note") to Xxxx Xxxxxxxx ("NH"), and a Promissory Note,
dated as of July 1, 1997, in the amount of $1,441,762.70 (as amended and
including any additional Promissory Notes delivered pursuant to the Xxxxxxxx
Intercreditor Agreement, the "JH Note", and, together with the NH Note, the
"Notes") to Xxxxxxx X. Xxxxxxxx ("JH", and together with NH, the "Henschels"),
pursuant to which the Company has certain unsecured payment obligations to the
Henschels (the "Xxxxxxxx Note Obligations").
H. The Company, the Facility Lenders, NH and JH have entered
into an Intercreditor Agreement, dated as of the date hereof (the "Xxxxxxxx
Intercreditor Agreement"), pursuant to which the Henschels have agreed not to
take certain actions specified therein and the Company has agreed to make
certain payments to amortize the Xxxxxxxx Note Obligations as provided therein.
NOW THEREFORE, for good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the Company, Bear
Xxxxxxx and the Facility Lenders agree to amend and restate the Original
Intercreditor Agreement to read in its entirety as follows:
Section 1. Standstill. (a) Each of the Facility Lenders and
Bear Xxxxxxx agrees, subject to the terms of this Agreement, that for the
Standstill Period, it shall not:
(i) file or join in the filing of any involuntary petition in
bankruptcy with respect to the Company or its Subsidiaries, or initiate
or participate in any similar proceedings for the benefit of creditors,
including any proceeding for the appointment of a trustee, receiver,
conservator or liquidator of the Company or its Subsidiaries or any
portion of its assets;
(ii) seek to collect or enforce by litigation or otherwise,
any repurchase or payment obligations under the Existing Agreements or
the Loan Documents; provided that nothing in this Section 1 shall
prohibit the Facility Lenders from exercising their Exchange Option;
(iii) make any Margin Calls or other demands for payment in
respect of, or additional collateral to secure, the Existing
Obligations; provided, however, that this clause shall not adversely
affect the right of Bear Xxxxxxx to take any actions to preserve,
protect or perfect its liens in the Collateral;
(iv) declare a default or event of default under, or exercise
or enforce any right or remedy under, or accelerate the maturity of any
Existing Obligation or Loan under, any Existing Agreement or Loan
Document; or
(v) seek to attach, sequester or otherwise proceed against any
of the Collateral, except as provided in Section 8(f) hereof.
(b) The Standstill Period may be terminated by Bear Xxxxxxx or
the Facility Lenders by written notice to the Company and each other Creditor
upon the occurrence of any of the following:
(i) a failure by the Company under the Existing
Agreements to make to Bear Xxxxxxx any scheduled payment of interest,
which failure continues unremedied for two days;
(ii) any intentional fraud or misrepresentation by
the Company;
(iii) immediately in the event any Other Existing
Lender takes any of the actions described in Section 1(a) of its Other
Intercreditor Agreement or either of the Henschels takes any of the
actions described in Section 1(a) of the Xxxxxxxx Intercreditor
Agreement, or, in the case of Bear Xxxxxxx, immediately in the event
any Facility Lender takes any of the actions described in Section 1(a)
of this Agreement, or, in the case of the Facility Lenders, immediately
in the event Bear Xxxxxxx takes any of the actions described in Section
1(a) of this Agreement or either of the Henschels takes any of the
actions described in Section 1(a) of the Xxxxxxxx Intercreditor
Agreement, in each case whether or not it shall have given notice of
termination of the Standstill Period;
(iv) a Change of Control or payment of the Take-Out
Premium except to the extent payable in accordance with Section 5
hereof;
(v) an event shall occur and be continuing for a
period of ten Business Days which permits (x) any holder of
indebtedness for borrowed money of the Company or the Designated
Subsidiary outstanding (other than the Company or any Creditor or
Residential Funding Corporation) to accelerate the maturity of such
indebtedness or (y) any holder of such indebtedness or any holder of
any guarantee or other obligation of the Company or the Designated
Subsidiary to exercise remedies with respect to property of the Company
or the Designated Subsidiary (other than the Company or Residential
Funding Corporation solely with respect to the Mortgage Loans held by
it as collateral for its existing loan), without such indebtedness
being paid or the rights of such holder to take such action being
waived, stayed or subjected to a standstill or other agreement of such
holder to forbear from exercising remedies, reasonably satisfactory to
the Creditors;
(vi) the Company shall, at any time on or after the
date of the closing of the Asset Sale, repay all or any portion of the
Loans, except any such repayment of the Loans in accordance with
Section 5 hereof;
(vii) The Company shall fail to make any payment
required to be made in accordance with Section 5 or 14 hereof;
(viii) The Company shall incur or pay any Operating
Expenses or incur or pay any obligations, except as expressly
contemplated hereby or by the Monthly Statement.
(ix) The Company shall breach the covenant set forth
in Section 8(g) or Section 5(h) hereof.
(c) The Standstill Period shall terminate automatically
without notice or other action by any Creditor upon the occurrence of any of the
following:
(i) the Company or any Designated Subsidiary shall
consent to the appointment of or taking possession by a receiver,
assignee, custodian, sequestrator, trustee or liquidator (or other
similar official) of itself or of a substantial part of its property;
or the Company or any Designated Subsidiary shall admit in writing (to
any creditor, governmental authority or judicial court or tribunal) its
inability to pay its debts generally as they come due or shall fail
generally to pay its debts as they become due, or shall make a general
assignment for the benefit of its creditors; or the Company or any
Designated Subsidiary shall file a voluntary petition in bankruptcy or
a voluntary petition or answer seeking liquidation, reorganization or
other relief with respect to itself or its debts under the Federal
bankruptcy laws, as now or hereafter constituted or any other
applicable Federal or State bankruptcy, insolvency or other similar
law, or shall consent to the entry of an order for relief in an
involuntary case under any such law; or the Company or any Designated
Subsidiary shall file an answer admitting the material allegations of
a petition filed against the Company or such Designated Subsidiary in
any such proceeding, or otherwise seek relief under the provisions of
any existing or future Federal or State bankruptcy, insolvency or other
similar law providing for the reorganization or winding-up of
corporations, or providing for an arrangement, agreement,
composition, extension or adjustment with its creditors; or the
Company or any Designated Subsidiary shall take or publicly announce
its intention to take corporate action in furtherance of any of the
foregoing; or
(ii) an order, judgment or decree shall be entered in
any proceeding by any court of competent jurisdiction appointing,
without the
consent of the Company, a receiver, trustee or liquidator of the
Company or any Designated Subsidiary or of any substantial part of
their respective property, or any substantial part of the property of
the Company or any Designated Subsidiary shall be sequestered, and any
such order, judgment or decree of appointment or sequestration shall
remain in force undismissed, unstayed or unvacated for a period of 30
days after the date of entry thereof; or
(iii) an involuntary petition against the Company or
any Designated Subsidiary in a proceeding under the Federal bankruptcy
laws or other insolvency laws, as now or hereafter in effect, shall be
filed and shall not be withdrawn or dismissed within 30 days
thereafter, or a decree or order for relief in respect of the Company
or any Designated Subsidiary shall be entered by a court of competent
jurisdiction in an involuntary case under the Federal bankruptcy laws,
as now or hereafter constituted, or, under the provisions of any law
providing for reorganization or winding-up of corporations which may
apply to the Company or any Designated Subsidiary, any court of
competent jurisdiction shall assume jurisdiction, custody or control
of the Company or any Designated Subsidiary or of any substantial part
of their respective property and such jurisdiction, custody or
control shall remain in force unrelinquished, unstayed or
unterminated for a period of 30 days.
Section 2. Grant of Security Interest. (a) In order to secure
full and timely payment of the Obligations under the Loan Agreement, and to
secure the performance of all of the other obligations of the Company under the
Loan Documents, the Company and each Subsidiary hereby mortgages, pledges and
assigns and transfers to the Facility Lenders, and grants to the Facility
Lenders, a continuing perfected security interest in, and a lien in the
Collateral. The Facility Lenders agree to release their lien in respect of any
whole loan mortgage, which is sold by the Company (i) to Bear Xxxxxxx for a
purchase price not less than the advance rate (or, in the case of any Sixty Day
Mortgage Loans or Ninety Day Mortgage Loans, at not less than 80% or 68.6% of
the principal outstanding on such Mortgage Loans, respectively) in respect of
such mortgage, (ii) pursuant to Section 8(f) hereof, (iii) pursuant to a
securitization of Mortgage Loans or (iv) in a sale to an unaffiliated third
party.
(b) The Facility Lenders agree for the benefit of Bear Xxxxxxx
that during the continuance of the Standstill Period and thereafter until the
earlier of (i) 91 days after the satisfaction of the Existing Obligations in
full, (ii) the exercise by Bear Xxxxxxx of any right to attach, sequester,
foreclose or otherwise exercise remedies with respect to the Collateral, and
(iii) 180 days after the expiration or earlier termination of the Standstill
Period, the Facility Lenders will not seek to attach, sequester, foreclose, levy
on or otherwise exercise remedies with respect to the Collateral, provided that
nothing in this Section 2(b) shall restrict the Facility Lenders from commencing
suit on its Notes or for payment of its Loan, the BankBoston Debt, the Facility
Lender Advances or enforcement (other than by exercising remedies with respect
to the Collateral) of any other obligation owing to it under the Loan Documents
or otherwise by the Company.
Section 3. Acknowledgment and Priorities. (a) Bear Xxxxxxx
hereby acknowledges and consents to the entrance by the Company into the Loan
Documents and the granting of the lien in the Collateral granted pursuant to
Section 2; provided, however, notwithstanding anything to the contrary contained
in the Loan Agreement, the Notes or any of the Loan Documents, the parties
hereto acknowledge and agree that any security interest in or other rights with
respect to any Collateral granted to secure the Existing Obligations under the
Existing Agreements or otherwise has and shall have priority over any security
interest in such Collateral granted pursuant to this Agreement, the Loan
Agreement or the other Loan Documents irrespective of:
(i) the time, order or method of attachment or perfection of
the security interest created by this Agreement, the Loan Agreement or
any Loan Document;
(ii) the time or order of filing or recording of financing
statements or other documents filed or recorded to perfect security
interests in any Collateral;
(iii) anything contained in any filing or agreement to which
the Facility Lenders, the Company, or the Collateral Agent under the
Security Documents now or hereafter may be a party, and
(iv) the rules for determining priority under the UCC or other
laws governing the relative priorities of secured creditors.
(b) Bear Xxxxxxx hereby agrees, and the Company acknowledges,
that, promptly following the expiration of 91 days after payment in full of all
the Existing Obligations hereunder, any Collateral, including any books and
records (including, without limitation, computer files, printouts and other
computer materials and records) relating to the Collateral, as well as all
proceeds and products of such Collateral, held by it shall be held for the
benefit of the Facility Lenders, provided that if such Collateral is then
subject to the prior lien of another creditor, Bear Xxxxxxx may hold it for the
benefit of such other creditor and the Facility Lenders as their interests may
appear. If Bear Xxxxxxx has elected not to hold such Collateral following
payment in full of the Existing Obligations, it shall promptly forward any
Collateral, including any books and records (including, without limitation,
computer files, printouts and other computer materials and records) relating to
the Collateral, as well as all proceeds and products of such Collateral, to the
Collateral Agent, provided that if such Collateral is then subject to the prior
lien of another creditor, Bear Xxxxxxx may forward such Collateral, proceeds and
products thereof to such other creditor or, in the event of a dispute, to such
party as a court of competent jurisdiction may direct.
(c) Nothing contained in this Agreement shall alter or impair
Bear Xxxxxxx' rights under the Existing Agreements from and after the
termination of the Standstill Period in accordance herewith or be interpreted to
mean that Bear Xxxxxxx has any obligation under the Existing Agreements or
otherwise to return any proceeds received on a sale or deemed sale of any
Purchased MBS or Purchased Loan to the Company or any Subsidiary, except as
expressly provided herein.
(d) Each of the parties hereto consents to the transactions
contemplated by the Asset Purchase Agreement.
Section 4. Reserved Rights. (a) Notwithstanding anything in
this Agreement to the contrary, the Company and the Facility Lenders agree that
this Agreement shall in no manner impair any right of Bear Xxxxxxx under the
Existing Agreements to enforce any condition precedent to any obligation it may
have thereunder to engage in future Repurchase Transactions with the Company and
its Subsidiaries, nor shall this Agreement limit the right of Bear Xxxxxxx to
make Margin Calls in respect of the hedging transactions with respect
to U.S. treasury securities that the Company may have entered into with Bear
Xxxxxxx outside of the Existing Agreements. All rights and obligations of Bear
Xxxxxxx under the Existing Agreements to enter into Repurchase Transactions or
not shall not be affected by this Agreement.
(b) In addition and notwithstanding anything to the contrary
contained herein (but subject to Section 8(f) hereof), this Agreement shall not
(i) apply to any Advances made from and after the date hereof, or any other
obligation of the Company or any of its Subsidiaries to Bear Xxxxxxx or any of
its Affiliates incurred from and after the date hereof or (ii) limit the rights
of Bear Xxxxxxx or any Affiliate thereof (x) subject to Section 8(f) hereof, to
purchase Mortgage Loans from the Company or any of its Subsidiaries, (y) to
receive principal and/or interest at the applicable mortgage rate on mortgage
loans purchased by Bear Xxxxxxx or any such Affiliate from the Company or any of
its Subsidiaries or (z) to sell mortgage loans to the Company or any of its
Subsidiaries.
Section 5. Fees; Amortization . During the Standstill Period,
the following provisions contained in this Section 5 shall apply:
(a) From and after the date this Agreement becomes effective
and prior to the date of the closing of the Asset Sale, within five days
following receipt by Bear Xxxxxxx each month of Available Cash Flow from
Securitization Receivables, Bear Xxxxxxx shall apply ninety percent (90%) of
such Available Cash Flow from Securitization Receivables to the repayment of
principal of the Existing Obligations relating to the Purchased MBS's generating
such Available Cash Flow from Securitization Receivables and shall remit the
balance of such Available Cash Flow from Securitization Receivables to the
Company.
(b) Upon the closing of the Asset Sale, the Company shall pay
to Bear Xxxxxxx the sum of (x) its Pro-Rata Share of the product of (A) seventy
percent (70%) and (B) the Transaction Proceeds Amount, plus (y) the Warehouse
Debt Shortfall with respect to Bear Xxxxxxx and minus (z) the Xxxxxxxx Make-up
Amount, in each case to be applied to repayment of principal of the Existing
Obligations.
(c) Upon the closing of the Asset Sale, the Company shall pay
to the Facility Lenders and the Henschels, as their interests may appear
pursuant to the Xxxxxxxx Intercreditor Agreement, the sum of (x) the product of
(A) thirty
percent (30%) and (B) the Transaction Proceeds Amount, plus (y) three times the
Xxxxxxxx Make-up Amount, in the case of the Facility Lenders, to be applied to
repayment of principal of the BankBoston Debt until such Debt is paid in full,
and then to repayment of the Loans and any other obligations due the Facility
Lenders, and, in the case of the Henschels, to be applied to repayment of the
Xxxxxxxx Note Obligations.
(d) Upon the closing of the Asset Sale, the Company shall pay
to the Facility Lenders the sum of the CMC Advance Proceeds and the Delinquent
Interest Advance Shortfall Amount, in each case to be applied to repayment of
all obligations owing in respect of any outstanding Facility Lender Advances.
(e) Upon the closing of the Asset Sale, the Company shall pay
or reimburse Bear Xxxxxxx and the Facility Lenders for any Transaction Expenses
and Professional Fees then due and owing.
(f) Upon the closing of the Asset Sale, the Company shall
cause CMC to pay the Tax Escrow Amount to the escrow agent under the Tax Escrow
Agreement for deposit thereunder and application in accordance with the terms
thereof.
(g) Upon the closing of the Asset Sale, the Company shall
cause CMC to pay the Securitization Escrow Amount to the escrow agent under the
Securitization Escrow Agreement for deposit thereunder and application in
accordance with the terms thereof.
(h) Upon the closing of the Asset Sale, the Company shall
cause CMC to deposit a portion of the sale proceeds in an amount equal to the
NLC Amount in a separate bank account with a bank reasonably satisfactory to the
Creditors, solely for the benefit of the Creditors (and not for the benefit of
the Company), and not commingled with any funds of the Company, which shall be
applied from time to time solely for the purpose of making advances for
warehouse financing to National Lending Center, Inc., such warehouse financing
to mature not later than 90 days after the closing of the Asset Sale and to be
on terms and pursuant to documentation reasonably satisfactory to the Creditors,
which financing shall provide for all repayments in respect of such financing to
be paid directly for deposit to such account. Upon the date which is 90 days
after
the closing of the Asset Sale and from time to time thereafter upon receipt of
the net proceeds of such warehouse financing, the amount on deposit in such
account shall, pursuant to irrevocable instructions given by the Company at or
before the closing of the Asset Sale, be immediately paid to the escrow agent
under the NLC Escrow Agreement for deposit and application thereunder.
(i) Upon the closing of the Asset Sale, the Company shall
apply the SafeCo Shortfall Amount to payment of the insurance premiums payable
to SafeCo.
(j) Upon the closing of the Asset Sale, the Company shall pay
to Bear Xxxxxxx and the Facility Lenders any accrued and unpaid Price
Differential or interest on the Existing Obligations, the BankBoston Debt and
the Loan Agreement to but not including the date of such closing.
(k) Any Reserve Release shall be made by the relevant escrow
agent pursuant to the Securitization Escrow Agreement, the NLC Escrow Agreement
or the Tax Escrow Agreement, as the case may be, to Bear Xxxxxxx, the Other
Existing Lenders, the Facility Lenders and the Henschels, as their interests may
appear pursuant to such escrow agreements.
(l) Promptly upon receipt by the Company of any Mortgage Sale
Excess Proceeds, the Company shall pay (x) to Bear Xxxxxxx an amount equal to
its Pro-Rata Share of the product of seventy percent (70%) and any Mortgage Sale
Excess Proceeds, to be applied to repayment of principal of the Existing
Obligations under the Existing Agreements, and (y) to the Facility Lenders and
the Henschels, as their interests may appear pursuant to the Xxxxxxxx
Intercreditor Agreement, the product of thirty percent (30%) and any Mortgage
Sale Excess Proceeds, in the case of the Facility Lenders, to be applied to
repayment of principal of the BankBoston Debt until such Debt is paid in full,
and then to repayment of the Loans and any other obligations due the Facility
Lenders, and, in the case of the Henschels, to be applied to repayment of the
Xxxxxxxx Note Obligations.
(m) Promptly upon the sale of any Mortgage Loan securing (or
purchased subject to a repurchase obligation comprising) any Existing
Obligations that gives rise to a Mortgage Sale Shortfall, the Company shall pay
Bear Xxxxxxx the amount of such Mortgage Sale Shortfall.
(n) Within five days following receipt by Bear Xxxxxxx of
Available Cash Flow from Securitization Receivables during the month in which
the closing of the Asset Sale occurs, Bear Xxxxxxx shall (a) apply ninety
percent (90%) of the Available Cash Flow from Securitization Receivables for
such month to the repayment of principal of the Existing Obligations under the
Existing Agreements and (b) remit the balance of such Available Cash Flow from
Securitization Receivables to the Facility Lenders for payment to the Facility
Lenders and the Henschels, as their interests may appear pursuant to the
Xxxxxxxx Intercreditor Agreement, in the case of the Facility Lenders, for
application to the repayment of principal of the Bank Boston Debt, until such
Debt is paid in full, and then to repayment of principal of the Loans and any
other obligations due the Facility Lenders, and, in the case of the Henschels,
to be applied to repayment of the Xxxxxxxx Note Obligations.
(o) Not later than the 15th calendar day (or the next business
day, if the 15th is not a business day) after the end of each calendar month
ending on or after the closing of the Asset Sale, the Company shall prepare and
deliver to Bear Xxxxxxx a Monthly Statement and, following the receipt of such
Monthly Statement by Bear Xxxxxxx, the Available Post-Transaction Cash Flow with
respect to such month shall be distributed in each such month as follows:
(i) within five days following receipt by Bear Xxxxxxx of the
Monthly Statement for such month but not sooner than one
business day after receipt by Bear Xxxxxxx of the Available
Cash Flow from Securitization Receivables paid to Bear Xxxxxxx
that month, Bear Xxxxxxx or the Collateral Agent, if it shall
have received the Collateral pursuant to Section 3(b) hereof,
shall remit to the Company Bear Xxxxxxx' Allocable Share of
the Monthly Cash Flow Shortfall Amount, if any, from such
Available Cash Flow from Securitization Receivables, if any;
provided, that in the event there is a dispute (including any
dispute arising from the failure of the requisite Creditors to
approve any Monthly Statement) with respect to the calculation
of the Monthly Cash Flow Shortfall Amount, Bear Xxxxxxx shall
remit to the Company such portion of the Monthly Cash Flow
Shortfall Amount as calculated by the Company as is not in
dispute and shall remit any balance promptly upon resolution
of such dispute (it being understood and agreed that Bear
Xxxxxxx'
obligation under this clause (i) for any month shall not
exceed the Available Cash Flow from Securitization Receivables
actually received that month);
(ii) until such time as the Existing Obligations have been repaid
in full:
(A) Bear Xxxxxxx shall (a) apply ninety percent (90%) of the
Available Cash Flow from Securitization Receivables for such
month remaining after the payment, if any, of Bear Xxxxxxx'
Allocable Share of the Monthly Cash Flow Shortfall Amount
pursuant to subsection (i) above, to the repayment of
principal of the Existing Obligations under the Existing
Agreements and (b) remit the balance, if any, of such
Available Cash Flow from Securitization Receivables to the
Facility Lenders for payment to the Facility Lenders and the
Henschels, as their interests may appear pursuant to the
Xxxxxxxx Intercreditor Agreement, in the case of the Facility
Lenders, for application to the repayment of principal of the
BankBoston Debt, until such Debt is paid in full, and then to
repayment of principal of the Loans and any other obligations
due the Facility Lenders, and, in the case of the Henschels,
to be applied to repayment of the Xxxxxxxx Note Obligations;
and
(B) the Company shall (a) remit to Bear Xxxxxxx for
application to the repayment of principal of the Existing
Obligations under the Existing Agreements Bear Xxxxxxx'
Allocable Share of an amount equal to 90% of the Monthly Free
Cash Flow Amount, if any, and (b) remit an amount equal to 10%
of the Monthly Free Cash Flow Amount to the Facility Lenders
for payment to the Facility Lenders and the Henschels, as
their interests may appear pursuant to the Xxxxxxxx
Intercreditor Agreement, in the case of the Facility Lenders,
to be applied to repayment of principal of the BankBoston Debt
until such Debt is paid in full, and then to repayment of
principal of the Loans and any other obligations due the
Facility Lenders, and, in the case of the Henschels, to be
applied to repayment of the Xxxxxxxx Note Obligations.
(iii) after such time as the Existing Obligations shall have been
repaid in full and until all obligations due to the Facility
Lenders and the
Henschels have been paid in full:
(A) Bear Xxxxxxx, or the Collateral Agent, if it shall have
received the Collateral pursuant to Section 3(b) hereof, shall
remit Bear Xxxxxxx' Allocable Share of the Monthly Cash Flow
Shortfall Amount to the Company as provided in subsection (i)
above and remit 100% of the Available Cash Flow from
Securitization Receivables remaining after the remittance, if
any, in respect of the Monthly Cash Flow Shortfall Amount
pursuant to subsection (i) above, to the Facility Lenders for
payment to the Facility Lenders and the Henschels, as their
interests may appear pursuant to the Xxxxxxxx Intercreditor
Agreement, in the case of the Facility Lenders, to be applied
to repayment of principal of the BankBoston Debt until such
Debt is paid in full, and then to repayment of principal of
the Loans and any other obligations due the Facility Lenders,
and, in the case of the Henschels, to be applied to repayment
of the Xxxxxxxx Note Obligations, and
(B) the Company shall remit 100% of the Monthly Free Cash Flow
Amount, if any, to the Facility Lenders and the Henschels, as
their interests may appear pursuant to the Xxxxxxxx
Intercreditor Agreement, in the case of the Facility Lenders,
to be applied to repayment of principal of the BankBoston Debt
until such Debt is paid in full, and then to repayment of
principal of the Loans any other obligations due the Facility
Lenders, and, in the case of the Henschels, to be applied to
repayment of the Xxxxxxxx Note Obligations.
(p) The Company shall immediately pay Bear Xxxxxxx for
application to the Existing Obligations an amount equal to the Net Proceeds of
Sale of Securitization Receivables in respect of any Purchased MBS and the net
proceeds of any sale of Purchased Loans comprising a portion of the Collateral,
in each case which are sold or otherwise disposed of by the Company or any
Subsidiary. The Company shall not sell or otherwise dispose of any Purchased MBS
or any such Purchased Loan without Bear Xxxxxxx' and, in the case of any
Purchased MBS, each other Creditor's consent, such consent not to be
unreasonably withheld or delayed by Bear Xxxxxxx, such other Creditors or the
Company (it being understood and agreed that the delivery by Bear Xxxxxxx of a
release of its lien in respect of a Purchased Loan being sold shall constitute
conclusive evidence of such consent). The parties agree that it would be
reasonable for Bear Xxxxxxx and each other Creditor to withhold its consent to
any such sale if, in its sole discretion, Bear Xxxxxxx or, in the case of any
sale of any Purchased MBS, such other Creditor concludes that (i) such sale will
impair its ability to be paid the Existing Obligations or the obligations due
such other Creditor, (ii) such sale will adversely affect the Available Cash
Flow from Securitization Receivables or Available Cash Flow from Other Creditor
Residuals, as the case may be, (iii) the selling price for the Purchased MBS or
any such Purchased Loan should be higher or (iv) the Purchased MBS or any such
Purchased Loan has not been adequately marketed.
(q) In the event the Company shall fail to pay when due any
amount due to Bear Xxxxxxx under this Agreement, Bear Xxxxxxx may set off such
amount against Available Cash Flow from Securitization Receivables or payments
on Purchased Loans otherwise payable to the Company hereunder.
Section 6. Conditions Precedent. The effectiveness of this
Agreement shall be subject to the condition that each of the other Existing
Lenders listed on Schedule I (the "Other Existing Lenders") shall have entered
into an Other Intercreditor Agreement in the form annexed hereto, and the
Company, the Facility Lenders and the Henschels shall have entered into the
Xxxxxxxx Intercreditor Agreement and the Company, the Creditors and the
applicable escrow agents shall have entered into the Tax Escrow Agreement, the
NLC Escrow Agreement and the Securitization Escrow Agreement. The Company shall
furnish Bear Xxxxxxx complete and correct copies of each such Other
Intercreditor Agreement and the Xxxxxxxx Intercreditor Agreement within one
business day of its execution.
Section 7. Certain Definitions.
"Allocable Share" means, with respect to the Monthly Cash Flow
Shortfall Amount, the percentage obtained by dividing (i) Available Cash Flow
from Securitization Receivables for such month by (ii) the sum of Available Cash
Flow from Securitization Receivables and Available Cash Flow from Other Creditor
Residuals for such month and, with respect to any Monthly Free Cash Flow Amount,
means the percentage determined by dividing (i) the aggregate amount of Residual
Debt then outstanding owing to the Existing Lender by (ii)
the aggregate amount of Residual Debt then outstanding owing to the Existing
Lender or any Other Residual Lender.
"Asset Sale" has the meaning specified in the recitals.
"Available Cash Flow from Other Creditor Residuals" means the
amount of any distribution with respect to, or repayment of, the Residuals
pledged or sold, subject to repurchase obligations, by the Company and its
Subsidiaries to any Other Existing Lender and accepted by such Lender in
connection with the financing of such Residuals.
"Available Cash Flow from Securitization Receivables" means
the amount of any distribution with respect to, or prepayment of, any Purchased
MBS.
"Available Post-Transaction Cash Flow" means the sum of (i)
the Available Cash Flow from Securitization Receivables, (ii) the Available Cash
Flow from Other Creditor Residuals, (iii) the Non-Residual Cash Proceeds, (iv)
plus or minus the Operating Expense Differential, (v) minus the Operating
Expenses for the third succeeding month (except for any such month to which the
Initial Operating Expenses Amount relates) and (vi) minus for each of the months
of January and February, 2000, the cash interest payable to Creditors for that
month.
"BankBoston Debt" means the indebtedness of the Company owing
to the Facility Lenders in respect of the (i) Bridge Loan and Security
Agreement, dated as of October 10, 1997, as amended from time to time, by and
among the Company, certain of its Subsidiaries and BankBoston N.A., to which the
GSCP Funds have succeeded by assignment and (ii) a Loan and Security Agreement,
dated December 31, 1996, as amended from time to time, by and among the Company,
certain of its Subsidiaries and BankBoston N.A., to which the GSCP Funds have
succeeded by assignment.
"Business Plan" means a business plan of the Company and its
Subsidiaries prepared each month, which shall not provide for the conduct of any
business except that permitted pursuant to Section 8(g) hereof, and showing on a
monthly basis (a) an estimate of all Operating Expenses for the succeeding
twelve month period, and (b) actual Operating Expenses for the prior three
months (or such shorter period commencing on the day of the closing of the Asset
Sale), which plan shall have been prepared by the Company and approved, in the
case of the Initial Business Plan and the Business Plan for each successive
twelve-month period succeeding that covered by the Initial Business Plan (each
such Business Plan so approved, a "Subsequent Approved Business Plan"), by GSCP
and two of the other Creditors, or, if there are at least one but fewer than
three other Creditors with outstanding Existing Obligations (as defined herein
or in their respective Other Intercreditor Agreements), by GSCP and at least one
such Other Creditor and, in the case of each other Business Plan, by GSCP, such
approval not to be unreasonably withheld or delayed.
"Change of Control" means the occurrence of any of the
following events (other than as a consequence of the issuance of the Preferred
Stock to the Facility Lenders upon exercise of the Exchange Option or the
closing of the Asset Sale):
(i) the Company consummates any sale, lease, exchange
or other disposition of all or substantially all of the assets
of the Company in any transaction or series of transactions
not in the ordinary course of business and not contemplated by
a Business Plan; or
(ii) the Company engages in a merger, consolidation
or similar business combination with any third party.
"CMC Advance Proceeds" means any payments received by the
Company from CMC upon the closing of the Asset Sale in connection with CMC's
purchase from the Company of certain delinquent interest servicing advances
funded by and securing the Facility Lender Advances.
"Collateral" means (i) any rights of the Company in any
Eligible Asset transferred by the Company or its Subsidiaries to Bear Xxxxxxx in
connection with either a Repurchase Transaction or in response to a Margin Call;
(ii) all rights of the Company under the Existing Agreements, including the
Company's right to reacquire the Eligible Assets pursuant to the terms of the
Existing Agreements, the contractual right to receive payments, including the
right to payments of principal and interest and the right to enforce such
payments, arising from or under any of the Eligible Assets; (iii) the Company's
contractual right to service Purchased HELs (as defined in the Whole Loan
Repurchase Agreement); (iv) any other right, interest or property of the Company
or any Subsidiary now or hereafter securing the performance by the Company or
any Subsidiary of the Existing Obligations and (v) any and all proceeds,
payments, income, profits and products thereof, and all files and records
relating thereto.
"Common Stock" means the Company's common stock, par value
$0.001 per share.
"Company" means IMC Mortgage Company, a Florida corporation,
and any successor by merger and any entity purchasing all or substantially all
of the assets of the Company (other than pursuant to the Asset Purchase
Agreement).
"Creditor" means any of the Facility Lenders, Bear Xxxxxxx or
any Other Existing Lender.
"Delinquent Interest Advance Shortfall Amount" means the
amount of any obligations owing to the Facility Lenders in respect of the
Facility Lender Advances after giving effect to the payment by the Company to
the Facility Lenders of the CMC Advance Proceeds, which is estimated to be
approximately the amount set forth on Schedule III hereto corresponding to the
line entitled "Delinquent interest advance shortfall."
"Delinquent Mortgage Loan" means any Mortgage Loan which, as
of any date of determination, is more than 90 days delinquent in payment of any
principal or interest due thereunder.
"Designated Subsidiary" means National Lender Center until 366
days after the date on which any remaining advances made by the Company to
National Lending Center, Inc. shall have been repaid or written off and the net
proceeds thereof paid to the escrow agent under the NLC Escrow Agreement
pursuant to Section 5(h) hereof.
"Eligible Asset" means any Purchased HELs under the Whole Loan
Repurchase Agreement, Purchased MBS under the Residuals Repurchase Agreement, or
asset held on repurchase under the Existing Agreements and any
assets transferred by the Company or its Subsidiaries to Bear Xxxxxxx pursuant
to a Margin Call.
"Xxxxxxxx Make-up Amount" means the product of (i) 25% and
(ii) the excess if any of (A) $600,000 over (B) the amount the Henschels would
have received pursuant to Section 7(a) of the Xxxxxxxx Intercreditor Agreement
if the Facility Lenders had no obligation to pay the Minimum Payment (as defined
in Section 7(a) of the Xxxxxxxx Intercreditor Agreement).
"Initial Business Plan" means the initial Business Plan, a
copy of which is attached hereto as Schedule IV.
"Initial Operating Expenses Amount" means a good faith
estimate of the Company of Operating Expenses for the period commencing with the
day of the Closing of the Asset Sale and ending on the last day of the third
full calendar month thereafter (except for cash interest payable to the
Creditors for the months of January and February, 2000).
"LIBOR" means the London interbank offered rate for one-month
U.S. Dollar deposits as it appears on page five of the Telerate screen at or
about 9:00 a.m. (New York City time).
"Margin Call" means the right of Bear Xxxxxxx to give notice
to require the Company to transfer to Bear Xxxxxxx cash or additional
collateral.
"Monthly Free Cash Flow Amount" means, for any month, the
amount, if any, by which (i) the sum of (x) the Non-Residual Cash Proceeds, and
(y) any negative Operating Expense Differential exceeds (ii) the sum of (a) the
Operating Expenses for the third succeeding month (but only to the extent not
provided for in the Initial Operating Expenses Amount), (b) any positive
Operating Expense Differential, in each case, as set forth on the Monthly
Statement and (c) for each of the months of January and February, 2000, the cash
interest payable to the Creditors for that month.
"Monthly Cash Flow Shortfall Amount" means, for any month, the
amount, if any, by which (i) the sum of (a) the Operating Expenses projected by
the Company for the third succeeding month (but only to the extent not provided
for in the Initial Operating Expenses Amount), (b) any positive Operating
Expense Differential and (c) for each of the months of January and February,
2000, the cash interest payable to the Creditors for that month exceeds (ii) the
sum of (x) the Non-Residual Cash Proceeds, and (y ) any negative Operating
Expense Differential, in each case, as set forth on the Monthly Statement.
"Monthly Statement" means a monthly cash flow statement and
projection prepared by the Company and approved in advance by GSCP or, if GSCP
declines to approve such statement, by two of the three other Creditors (and, if
the Operating Expenses (other than taxes, cash interest or Price Differential
payable on any obligations of the Company and any Mortgage Sale Shortfall) to be
incurred in any month are greater than the Operating Expenses (other than taxes,
cash interest [or Price Differential] payable on any obligations of the Company
and any Mortgage Sale Shortfall) for such month contained in the Initial
Business Plan or any Subsequently Approved Business Plan by more than (i) 10%,
by two of the three other Creditors, and (ii) 25%, by each Creditor), setting
forth the following: (i) the Available Cash Flow from Securitization Receivables
received during the prior month, (ii) the Available Cash Flow from Other
Creditor Residuals received during the prior month, (iii) the Non-Residual Cash
Proceeds received by the Company during the prior month, (iv) the amount of any
Reserve Release during the prior month, (v) the amount remaining on deposit
under the Tax Escrow Agreement, the NLC Escrow Agreement and the Securitization
Escrow Agreement, respectively, (vi) the estimated Operating Expenses to be
incurred by the Company and its Subsidiaries during the current month and the
third succeeding month, consistent with the Business Plan, (vii) the Operating
Expense Differential, (viii) any Mortgage Sale Excess Proceeds received or
Mortgage Sale Shortfall incurred, as the case may be, during the prior month,
(ix) any Monthly Cash Flow Shortfall Amount or Monthly Free Cash Flow Amount, as
the case may be, and, in the case of the Monthly Cash Flow Shortfall Amount,
Bear Xxxxxxx' and each Other Residual Lender's Allocable Share thereof, (x) the
Business Plan, and (xi) a capitalization table showing the indebtedness owing to
each creditor of the Company both as of the end of the prior month and after the
application of all amounts to be paid to such creditor pursuant to this Monthly
Statement and Section 5 hereof.
"Mortgage Loan" means any first-lien or second-lien
residential mortgage loan originated or serviced by the Company or its
Subsidiaries.
"Mortgage Sale Excess Proceeds" means (i) with respect to any
Sixty Day Mortgage Loan, the amount of any proceeds from the sale or other
disposition of such loan in excess of eighty percent (80%) of the principal
outstanding on such Sixty Day Mortgage Loan as of November 5, 1999, and (ii)
with respect to any Ninety Day Mortgage Loan, the amount of any proceeds from
the sale or other disposition of such loan in excess of sixty-eight and 60/100's
percent (68.6%) of the principal outstanding on such Ninety Day Mortgage Loan as
of November 5, 1999.
"Mortgage Sale Shortfall" means (i) with respect to any Sixty
Day Mortgage Loan, the amount of any deficit of any proceeds from the sale or
other disposition of such loan relative to eighty percent (80%) of the principal
outstanding on such Sixty Day Mortgage Loan as of November 5, 1999, (ii) with
respect to any Ninety Day Mortgage Loan, the amount of any deficit of any
proceeds from the sale or other disposition of such loan relative to sixty-eight
and 60/100's percent (68.6%) of the principal outstanding on such Ninety Day
Mortgage Loan as of November 5, 1999 and (iii) with respect to any Mortgage Loan
(other than any Sixty Day Mortgage Loan or Ninety Day Mortgage Loan) sold or
otherwise disposed of after the closing of the Asset Sale and not included in
the proposed securitization of Mortgage Loans to which the Securitization Escrow
Agreement relates, any amount remaining outstanding on the applicable Creditor's
advances in respect of such Mortgage Loan after applying the net proceeds of the
sale of such Mortgage Loan (and after applying any amount distributed to the
applicable Creditor under the Securitization Escrow Agreement in respect of such
Mortgage Loan to repayment of the related advance) to repayment of the related
advance.
"Net Asset Sale Proceeds" means the cash proceeds received by
the Company upon the closing of the Asset Sale (including, without limitation,
the proceeds from the purchase by CMC of the servicing advances), net of any
Transaction Expenses and Professional Fees, and exclusive of the CMC Advance
Proceeds.
"Net Proceeds of Sale of Securitization Receivables" means the
proceeds, net of any reasonable out-of-pocket costs of sale or disposition,
realized by the Company or any Subsidiary from any sale, lease or other
disposition of any Purchased MBS.
"Ninety Day Mortgage Loans" means Mortgage Loans financed
(including by purchase subject to a repurchase obligation) by a Creditor which
are more than 90 days delinquent on November 5, 1999.
"NLC Amount" means the amount set forth on Schedule III hereto
corresponding to the line entitled "NLC 90-day warehouse financing", which
represents the amount required to be reserved for warehouse financing to be
provided by the Company to National Lending Center, Inc. for a period not to
exceed 90 days following the closing of the Asset Sale.
"NLC Escrow Agreement" means an escrow agreement among the
Company, each of the Creditors, and a bank acting as escrow agent, reasonably
acceptable to each Creditor, which agreement is satisfactory in form and
substance to each Creditor, providing for the deposit of the proceeds of the
warehouse financing to be provided by the Company to National Lending Center,
Inc. upon the closing of the transactions contemplated by the Asset Purchase
Agreement into escrow thereunder.
"Non-Residual Cash Proceeds" means any cash inflow to the
Company other than the Available Cash from Securitization Receivables, the
Available Cash from Other Creditor Residuals and the cash proceeds received upon
the closing of the Asset Sale, but only to the extent such cash proceeds are
applied or remain in reserve for application to the purpose for which such
proceeds were reserved as contemplated by Schedule III hereto.
"One-Time Working Capital Amount" means an amount representing
the Company's good faith estimate of the amount required to be reserved for the
payment of certain expenses and the run off of certain working capital items and
set forth on Schedule III hereto corresponding to the line entitled "One-time
working capital amount."
"Operating Expenses" means, for any period, the operating
expenses of the Company and its Subsidiaries incurred or to be incurred in
accordance with the current Monthly Statement or Initial Operating Expenses
Amount estimate, as the case may be, including, without limitation, any Mortgage
Sale Shortfall and any cash interest payable on any obligations of the Company.
"Operating Expense Differential" means, with respect to any
Monthly Statement, the difference (positive or negative) between the actual
Operating Expenses for the prior month and the estimated Operating Expenses
for such month reflected in the prior Monthly Statement (or, for the first such
statement, in the Initial Business Plan).
"Other Existing Lenders" has the meaning specified in Section
6.
"Other Intercreditor Agreements" means the separate
intercreditor agreements among the Company, an Other Existing Lender and the
Facility Lenders.
"Other Residual Lenders" means the Other Existing Lenders
which are owed Residual Debt.
"Person" means an individual, a corporation, a partnership, an
association, a trust or any other entity or organization, including a government
or political subdivision or an agency or instrumentality thereof.
"Price Differential" has the meaning given in the applicable
Existing Agreement.
"Pro-Rata Share" means the fraction derived by dividing (i)
the Residual Debt owing to Bear Xxxxxxx by (ii) the aggregate amount of the
Company's obligations in respect of Residual Debt, determined as of the date of
the closing of the Asset Sale.
"Purchased Loan" means any Mortgage Loan or Wet Mortgage Loan
that is transferred by the Company or its Subsidiaries to Bear Xxxxxxx in
connection with a Repurchase Transaction.
"Purchased MBS" means any security transferred to Bear Xxxxxxx
by the Company or any Subsidiary in connection with a Repurchase Transaction.
"Repurchase Transaction" means any transaction made by Bear
Xxxxxxx under the Existing Agreements.
"Reserve Release" means any release of funds to Bear Xxxxxxx,
the Other Existing Lenders, the Facility Lenders or the Henschels pursuant to
the Securitization Escrow Agreement, the Tax Escrow Agreement or the NLC Escrow
Agreement.
"Residual" means any residual, subordinated or interest strip
class of asset-backed security (i) issued in connection with a securitization in
which any Creditor or its designee acted as lead or co-lead underwriter or
placement agent and (ii ) pledged or sold, subject to repurchase obligation, by
the Company and its Subsidiaries and accepted by such Creditor in connection
with the financing of such security.
"Residual Debt" means the amount of any indebtedness of the
Company or any Subsidiary owing to the Existing Lender or any Other Existing
Lender and incurred in connection with the financing (including by purchase
subject to a repurchase obligation) of any Residual.
"SafeCo Shortfall Amount" means the shortfall in the amount
received from CMC in connection with CMC's purchase of certain insurance
receivables of the Company in connection with the Asset Sale compared with the
corresponding insurance premium payables, an estimate of which is set forth on
Schedule III hereto corresponding to the line entitled "SafeCo shortfall."
"Securitization Escrow Agreement" means an escrow agreement
among the Company, each of the Creditors, and a bank acting as escrow agent,
reasonably acceptable to each Creditor, which agreement is satisfactory in form
and substance to each Creditor, providing for the deposit of the Securitization
Escrow Amount upon the closing of the transactions contemplated by the Asset
Purchase Agreement into escrow thereunder.
"Securitization Escrow Amount" means the amount set forth on
Schedule III hereto corresponding to the line entitled "Securitization Escrow
Amount."
"Seller's Guide" means the "IMC Mortgage Company Client
Operations Manual", together with the underwriting guidelines of the Company and
its Subsidiaries, a true and correct copy of which was previously provided to
Bear Xxxxxxx by the Company and its Subsidiaries.
"Sixty Day Mortgage Loans" means Mortgage Loans financed
(including by purchase subject to a repurchase obligation) by a Creditor which
are more than 60 days but not more than 90 days delinquent on November 5,
1999.
"Sold Mortgage Loan" means any Mortgage Loan (other than any
Sixty Day Mortgage Loan or Ninety Day Mortgage Loan), sold or otherwise disposed
of by the Company prior to the closing of the Asset Sale.
"Standstill Period" means a period ending on the first to
occur of (i) the repayment in full of all Existing Obligations, all obligations
owed to the Facility Lenders and the Xxxxxxxx Note Obligations, (ii) termination
of the Standstill Period in accordance with Section 1(b) or 1(c) hereof, (iii)
termination of the Asset Purchase Agreement or (iv) December 3, 1999, if the
closing of the Asset Sale shall not have occurred by such date.
"Subsidiary" means, with respect to any Person, any
corporation or other entity of which securities or other ownership interests
having ordinary voting power to elect a majority of the board of directors or
other persons performing similar functions are at the time directly or
indirectly owned by such Person.
"Tax Escrow Agreement" means an escrow agreement among the
Company, each of the Creditors, and a bank acting as escrow agent, reasonably
acceptable to each Creditor, which agreement is satisfactory in form and
substance to each Creditor, providing for the deposit of the Tax Escrow Amount
upon the closing of the transactions contemplated by the Asset Purchase
Agreement into escrow thereunder.
"Tax Escrow Amount" means the amount set forth on Schedule III
hereto corresponding to the line entitled "Tax Escrow Amount", which, together
with the NLC Amount, represents the Company's good faith estimate of the amount
required to be reserved for the payment of tax liabilities of the Company
associated with Federal and state income taxes payable with respect to the year
ended December 31, 1999.
"Transaction Expenses and Professional Fees" means any unpaid
transaction expenses or professional fees payable in connection with the Asset
Sale, the preparation or negotiation of the various intercreditor agreements,
the documentation relating to the Facility Lender Advances and any prior monthly
servicing advances, the Acquisition Agreement, the Asset Purchase Agreement, any
transactions contemplated by or related to such agreements or transactions
or otherwise, an estimate of which is set forth in Schedule III hereto,
corresponding to the line entitled "Transaction expenses and professional fees."
"Transaction Proceeds Amount" means the amount derived by
subtracting from the Net Asset Sale Proceeds (A) the Tax Escrow Amount, (B) the
Securitization Escrow Amount, (C ) the One-Time Working Capital Amount, (D) the
Delinquent Interest Advance Shortfall Amount, (E) the SafeCo Shortfall Amount,
(F) the Initial Operating Expenses Amount, (G) the Warehouse Debt Shortfall and
( H) the NLC Amount.
"Warehouse Debt Shortfall" means the amount representing (i)
with respect to Sixty Day Mortgage Loans, the excess, if any, of the principal
outstanding on the applicable Creditor's advances in respect of such Sixty Day
Mortgage Loans on November 5, 1999 over 80% of the outstanding principal amount
of such Sixty Day Mortgage Loan; (ii) with respect to Ninety Day Mortgage Loans,
the excess, if any, of the principal outstanding on the applicable Creditor's
advances in respect of such Ninety Day Mortgage Loans on November 5, 1999 over
68.6% of the outstanding principal amount of such Ninety Day Mortgage Loan and
(iii) with respect to Sold Mortgage Loans, any amount remaining outstanding on
the applicable Creditor's advances in respect of such Sold Mortgage Loan after
applying the net proceeds of the sale of such Sold Mortgage Loan to repayment of
the related advance.
"Wet Mortgage Loan" means any residential mortgage loan
originated by the Company and its Subsidiaries in accordance with the Seller's
Guide, with respect to which all of the related documents required to be
delivered in connection with any Advance have not been deposited with the
custodian on or prior to the related Advance Date.
Section 8. Notice of Advances under the Loan Agreement, etc.
(a) The Company shall give each Creditor prompt written notice of any event
which upon notice or lapse of time or both would constitute an event of default
in respect of any of its outstanding Debt.
(b) The Company shall give Bear Xxxxxxx and the Facility
Lenders prompt written notice of any event that would permit termination of the
Standstill Period pursuant to Section 1(b) hereof.
(c) The Company shall give Bear Xxxxxxx prompt written notice
of the entering into any amendment of the Asset Purchase Agreement and the
closing of the Asset Sale.
(d) Notwithstanding the provisions of the Existing Agreements,
during the Standstill Period, the Company shall pay the Price Differential
accrued under the Existing Agreements to Bear Xxxxxxx weekly on Friday of each
week or, if Friday is not a Business Day, on the next Business Day and from and
after the closing of the Asset Sale, the Price Differential rate applicable to
the Existing Obligations shall be equal to LIBOR plus 300 basis points.
(e) The Company shall not repay any principal outstanding
under the Loan Agreement during the Standstill Period, except pursuant to
Section 5 hereof.
(f) In the event all remaining Purchased Loans have not been
sold by the Company on or before the date which is 180 days following the
closing of the Asset Sale, Bear Xxxxxxx may buy such Purchased Loans at their
then fair market value (as determined by independent third-party bid) or arrange
for the sale of such Purchased Loans to third parties at such fair market value,
and the Company shall take such actions and execute such customary agreements
and instruments as may be necessary to effect such sale and transfer good and
marketable title to such Purchased Loans to the purchaser thereof.
(g) Until all of the Company's obligations under this
Agreement, the Other Intercreditor Agreements, the Existing Agreements and the
Loan Agreement have been satisfied in full, the Company shall not conduct any
business or engage in any activities other than (a) liquidating its assets in an
orderly fashion and performing its obligations under (i) the Asset Purchase
Agreement, (ii) this Agreement (including its obligations under the Existing
Agreements), (iii) the Other Intercreditor Agreements and the Xxxxxxxx
Intercreditor Agreement and the agreements evidencing the indebtedness owing to
such other Creditors and the Henschels, (iv) the Tax Escrow Agreement, the NLC
Escrow Agreement and the Securitization Escrow Agreement, (v) any other
agreements existing on the date hereof and (v) satisfying its other obligations
and liabilities, (b) transacting any other lawful business under its certificate
of incorporation and by-laws that is incident, necessary and appropriate to
accomplish the foregoing, including defending any actions or proceedings. The
Company shall maintain not more than a commercially reasonable number of
employees necessary to conduct the foregoing activities. The Company shall not
incur any indebtedness for borrowed money other than liabilities incurred in the
ordinary course of its business (as such business is limited under the preceding
provision), and not grant any new liens (except as may be incidental to the
foregoing permitted activities).
Section 9. Acknowledgment of Obligations. The Company
acknowledges that its obligations under the Existing Agreements and Bear
Xxxxxxx' rights under the Existing Obligations remain in full force and effect,
and that the Company has no defenses, counterclaims or offsets to its
obligations under the Existing Agreements and that to the extent such rights
include liens on the Collateral, such liens are valid, perfected and
enforceable. The Company hereby waives the application of the automatic stay in
any bankruptcy proceeding in respect of the Existing Obligations and the
obligations under the Loan Documents and the Company and each Creditor consents
to the modification of the stay to permit the exercise by Bear Xxxxxxx or the
Facility Lenders of their rights in respect of the Collateral, provided that the
foregoing shall not be construed to modify the provisions of Sections 2(b) and 3
hereof. This document shall not constitute a waiver, amendment or modification
of the Existing Agreements, the Existing Obligations or the Loan Documents
except as expressly referred to herein and shall not be construed as a waiver or
consent to any future action on the part of the Company that would require a
waiver or consent of Bear Xxxxxxx or the Facility Lenders, respectively, except
to the extent expressly provided herein. The Company acknowledges that BSTrust
and BSIL are affiliates for purposes of the Institutional Account Agreement. The
Company and each Subsidiary hereby releases Bear Xxxxxxx, their respective
officers, directors and participants from any and all claims in respect of the
Existing Agreements and in respect of actions taken or not taken in connection
therewith on or prior to the date of execution and delivery hereof, excluding,
however, any obligation under any agreement by such person for the payment of
money, return of property or any contractual obligations. Effective upon the
closing of the Asset Sale and the receipt by the Creditors of the payments to be
received hereunder from the proceeds of the Asset Sale, the Existing Lender
hereby releases the executive officers and the directors of the Company from any
and all claims in respect of the Existing Agreements and in respect of the
actions taken or not taken in connection therewith on or prior to the date of
execution and delivery hereof, excluding, however, any obligations under any
agreement by such person for the payment of money, return of property or any
contractual obligations, and also excluding any claims in respect of fraud or
intentional misconduct.
Section 10. Amendments, Etc. No amendment, modification,
supplement, termination, consent or waiver of this Agreement or any term or
provision of this Agreement shall be effective and binding unless in writing and
signed by Bear Xxxxxxx, the Other Existing Lenders and the Facility Lenders. Any
such waiver will be effective only in the specific instance and for the specific
purpose for which it is given.
Section 11. Severability. Any provision of this Agreement
which is illegal, invalid, prohibited or unenforceable in any jurisdiction
shall, as to such jurisdiction, be ineffective to the extent of such illegality,
invalidity, prohibition or unenforceability without invalidating or impairing
the remaining provisions hereof or affecting the validity or enforceability of
such provision in any other jurisdiction.
Section 12. WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO
HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL OR
EQUITABLE ACTION, SUIT OR PROCEEDING ARISING OUT OF OR RELATING TO THIS
AGREEMENT, OR ANY TRANSACTION CONTEMPLATED HEREBY OR THE RELATIONSHIP
ESTABLISHED HEREUNDER.
Section 13. GOVERNING LAW; VENUE AND JURISDICTION. THE
VALIDITY OF THIS AGREEMENT, THE CONSTRUCTION, INTERPRETATION AND ENFORCEMENT
HEREOF AND THE RIGHTS OF THE PARTIES HERETO SHALL BE DETERMINED UNDER, GOVERNED
BY, AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK
WITHOUT GIVING EFFECT TO CONFLICTS OF LAW PRINCIPLES THEREOF. EACH OF THE
PARTIES HERETO SUBMITS TO THE NON-EXCLUSIVE JURISDICTION OF, AND AGREES THAT ALL
ACTIONS OR PROCEEDINGS ARISING IN CONNECTION WITH THIS AGREEMENT MAY BE TRIED
AND LITIGATED IN, FEDERAL OR, IN THE ABSENCE OF FEDERAL SUBJECT MATTER
JURISDICTION, STATE COURTS LOCATED IN THE COUNTY OF NEW YORK, STATE OF NEW YORK
UNLESS SUCH ACTIONS OR PROCEEDINGS ARE REQUIRED TO BE BROUGHT IN ANOTHER COURT
TO OBTAIN SUBJECT MATTER JURISDICTION OVER THE MATTER IN CONTROVERSY. EACH OF
THE PARTIES WAIVES, TO THE FULLEST EXTENT PERMISSIBLE UNDER APPLICABLE LAW, ANY
RIGHT IT MAY HAVE TO ASSERT BY WAY OF MOTION, AS A DEFENSE OR OTHERWISE THE
DOCTRINE OF FORUM NON CONVENIENS OR TO OBJECT TO VENUE IN ANY PROCEEDING
BROUGHT IN ACCORDANCE WITH THE IMMEDIATELY PRECEDING SENTENCE. SERVICE OF
PROCESS, SUFFICIENT FOR PERSONAL JURISDICTION IN ANY ACTION AGAINST SUCH PARTY,
MAY BE MADE BY REGISTERED OR CERTIFIED MAIL, RETURN RECEIPT REQUESTED, TO ITS
ADDRESS INDICATED IN SECTION 16.
Section 14. Expenses. In addition to the foregoing, the
Company will also reimburse Bear Xxxxxxx and the Facility Lenders promptly for
their reasonable out-of-pocket costs and expenses incurred by such Persons or
their respective employees, agents or advisors in connection with the
performance of their respective obligations and duties hereunder and to the
extent the Existing Agreements so provide, under the Existing Agreements, and
for any reasonable fees and expenses of legal or other professional advisors to
Bear Xxxxxxx and the Facility Lenders engaged in connection with the preparation
and negotiation of this Agreement and review and negotiation of all related
documents, including the Asset Purchase Agreement and the Loan Agreement, and
monitoring performance of all related documents. If such costs and expenses are
not paid by the Company within 30 days of submission, Bear Xxxxxxx may pay such
fees from Available Cash Flow from Securitization Receivables and payments on
Purchased Loans, in which event appropriate adjustments shall be made to Bear
Xxxxxxx' and each Other Residual Lender's Allocable Share of Available Cash Flow
from Securitization Receivables as if such costs and expenses were paid by the
Company as Operating Expenses.
Section 15. Agreement May Constitute Financing Statement. The
Company and Bear Xxxxxxx consents to the filing of this Agreement or a photocopy
thereof as a financing statement under the UCC as in effect in any jurisdiction
in which the Facility Lenders may determine such filing to be necessary or
desirable.
Section 16. Notices. All notices, requests and other
communications to any party hereunder shall be in writing and shall be given
to
such party by facsimile transmission or by hand delivery at the following
address or facsimile number, or such other address or facsimile number as such
party may hereafter specify for the purpose by notice to the other party and
each other Creditor, (a) if to the Facility Lenders, Greenwich Street Capital
Partners II, L.P., c/o Greenwich Street Capital Partners, Inc., 000 Xxxxxxxxx
Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attn.: Xxxxxx Xxxxx; Tel: (000) 000-0000, Fax:
(000) 000-0000; with a copy to Debevoise & Xxxxxxxx, 000 Xxxxx Xxxxxx, Xxx Xxxx,
Xxx Xxxx 00000, attention: Xxxxxx Xxxxxx, Esq., Tel: (000) 000-0000, Fax: (212)
000-0000; (b) if to the Company, IMC Mortgage Company, 0000 X. Xxxxxx Xxxxxx,
Xxxxx, Xxxxxxx 00000, Attn.: President, Tel: (000) 000-0000, Fax: (813)
000-0000; with a copy to Xxxxxxxx X. Xxxxxx, 000X Xxxxxxxxx Xxx, Xxxxxxxxxxxx,
Xxxxxxx 00000, Tel: (000) 000-0000, Fax: (000) 000-0000; and (c) and if to Bear,
Xxxxxxx: Bear Xxxxxxx & Co. Inc., 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000,
Attn: Xxxxxx X. Cedar, Tel.: (000) 000-0000, Fax: (000) 000-0000 and Xxxx
Xxxxxxxx, Tel.: (000) 000-0000, Fax: (000) 000-0000, with a copy to; Cadwalader,
Xxxxxxxxxx & Xxxx, 000 Xxxxxx Xxxx, Xxx Xxxx, Xxx Xxxx 00000, Attn. Xxxxx X.
Xxxxxxx, Esq., Tel.: (000) 000-0000, Fax: (000) 000-0000; and if to any of the
Other Existing Lenders, to such person and at the address and facsimile number
provided in Schedule II hereto. Each such notice, request or other
communication shall be effective when sent by facsimile transmission to the
facsimile number or when delivered by hand to the address specified in this
Section 16 or Schedule II hereto, provided that a facsimile transmission shall
be deemed to have been sent only so long as the transmitting machine has
provided an electronic confirmation of such transmission.
Section 17. Binding Effect; Third Party Beneficiaries. This
Agreement shall be binding upon and inure to the benefit of the parties hereto
and their successors and permitted assigns, including any successor of the
Company by merger or any entity which purchases all or substantially all of the
assets of the Company (other than pursuant to the Asset Sale), and to each of
the other Creditors, and, as to Section 3(d) hereto, CMC, each of which is an
intended third-party beneficiary hereof. Neither the Facility Lenders nor Bear
Xxxxxxx may sell, assign, participate or otherwise transfer or dispose of all or
any portion of the Loan or the Existing Obligations to any Person unless such
Person shall have assumed and agreed to be bound by the terms hereof by written
instrument in form reasonably satisfactory to the Company and each other
Creditor.
Section 18. Interpretation; Transaction Intended as Purchases
and
Sales. The parties specifically acknowledge and recognize that certain language
and use of words in this Agreement may erroneously suggest that transactions
under the Existing Agreements are intended by them to be characterized as loans
or other secured financing arrangements and not as absolute purchases and sales
of mortgage loans and hereby reaffirm that all such transactions are intended to
constitute absolute purchases and sales.
Section 19. Counterparts; Section Headings. This Agreement may
be executed in any number of counterparts, each of which is an original, but all
of which together constitute but one instrument. Except as otherwise indicated,
references herein to any "Section" means a "Section" of this Agreement, and
the section headings in this Agreement are for purposes of reference only and
shall not limit or define the meaning hereof.
IN WITNESS WHEREOF, the parties have caused this Agreement to
be duly executed as of the date first above written.
IMC MORTGAGE COMPANY
By: /s/
-------------------------------
Name:
Title:
BEAR XXXXXXX HOME EQUITY TRUST
By: /s/
-------------------------------
Name:
Title:
BEAR XXXXXXX INTERNATIONAL LIMITED
By: /s/
-------------------------------
Name:
Title:
GREENWICH STREET CAPITAL PARTNERS II, L.P.
GSCP OFFSHORE FUND, L.P.
GREENWICH FUND, L.P.
GREENWICH STREET
EMPLOYEES FUND, L.P.
TRV EXECUTIVE FUND, L.P.
By: GREENWICH STREET
INVESTMENTS II, L.L.C.,
their General Partner
By: /s/
-------------------------------
Name:
Title:
This Intercreditor Agreement is hereby acknowledged and agreed to by:
IMC CORPORATION OF AMERICA
IMC CREDIT CARD, INC.
IMC MORTGAGE COMPANY CANADA, LTD.
AMERICAN HOME EQUITY CORPORATION
IMC INVESTMENT CORPORATION
IMC INVESTMENT LIMITED PARTNERSHIP
ACG FINANCIAL SERVICES (IMC), INC.
AMERICAN MORTGAGE REDUCTION, INC.
CENTRAL MONEY MORTGAGE CO. (IMC), INC.
COREWEST BANC
EQUITY MORTGAGE CO. (IMC), INC.
IMCC INTERNATIONAL, INC.
MORTGAGE AMERICA (IMC), INC.
NATIONAL LENDING CENTER, INC.
NATIONAL LENDING CENTER TILT, INC.
NATIONAL LENDING GROUP, INC.
RESIDENTIAL MORTGAGE CORPORATION (IMC), INC.
By: /s/
----------------------------------------
Name:
Title:
XXXXX XXXXXX REAL ESTATE SECURITIES INC.
By: /s/
----------------------------------------
Name:
Title:
GERMAN AMERICAN CAPITAL CORPORATION
By: /s/
----------------------------------------
Name:
Title:
By: /s/
----------------------------------------
Name:
Title:
Schedule I
to the
Bear Xxxxxxx Intercreditor Agreement
Other Existing Lenders
1. Loan and Security Agreement, dated March 17, 1998, by and among IMC
Mortgage Company, IMC Corporation of America, ACG Financial Services
(IMC), Inc., American Mortgage Reduction, Inc., Central Money Mortgage
Co. (IMC), Inc., Corewest Banc, Equity Mortgage Co., (IMC), Inc.,
Mortgage America (IMC), Inc., National Lending Center, Inc., National
Lending Center TILT, Inc, and Residential Mortgage Corporation (IMC),
Inc., as borrowers, and German American Capital Corporation, as lender.
2. Loan and Security Agreement, dated March 17, 1998, by and among IMC
Mortgage Company, IMC Corporation of America, ACG Financial Services
(IMC), Inc., American Mortgage Reduction, Inc., Central Money Mortgage
Co. (IMC), Inc., Corewest Banc, Equity Mortgage Co., (IMC), Inc.,
Mortgage America (IMC), Inc., National Lending Center, Inc., National
Lending Center TILT, Inc, and Residential Mortgage Corporation (IMC),
Inc., as borrowers, and German American Capital Corporation, as
successor by assignment from Aspen Funding Corp., as lender.
3. Loan and Security Agreement, dated as of February 28, 1997, between IMC
Mortgage Company, IMC Corporation of America, ACG Financial Services
(IMC), Inc., American Mortgage Reduction, Inc., Industry Mortgage
Company, L.P., Corewest Banc, IMC Investment Corp., and IMC Investment
Limited Partnership, as borrowers, and Xxxxx Xxxxxx Real Estate
Securities, Inc., as lender.
4. (i) Bridge Loan and Security Agreement, dated as of October 10, 1997,
as amended from time to time, by and among the Company, certain of its
Subsidiaries and BankBoston N.A., to which the Facility Lenders have
succeeded by assignment, and (ii) a Loan and Security Agreement, dated
December 31, 1996, as amended from time to time, by and among the
Company, certain of its Subsidiaries and BankBoston N.A., to which the
Facility Lenders have succeeded by assignment.
Schedule II
to the
Bear Xxxxxxx Intercreditor Agreement
Notice Address for Other Existing Lenders
Xxxxx Xxxxxx
if to Xxxxx Xxxxxx, to: PaineWebber Real Estate Securities, Inc., 0000 Xxxxxx xx
xxx Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attn.: Xxxxxx Xxxxxxxxxxxx, Tel: (212)
000-0000, Fax: (000) 000-0000; with a copy to Cadwalader, Xxxxxxxxxx & Xxxx, 000
Xxxxxx Xxxx, Xxx Xxxx, Xxx Xxxx 00000, Attn.: Xxxxxxx X. Xxxxxx, Esq., Tel:
(000) 000-0000; Fax: (000) 000-0000
Deutsche Lenders
if to German American Corporation, to: German American Capital Corporation, 00
Xxxx 00xx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attn.: Xxxxx Xxxxxxxxxxx, Tel.:
(000) 000-0000, Fax: (000) 000-0000, with a copy to: Deutsche Bank A.G., as
agent, 00 Xxxx 00xx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attn.: Xxxx Xxxxxxx, Tel.:
(000) 000-0000, Fax: (000) 000-0000, and Xxxxxxx Xxxxx, Tel.: (000) 000-0000,
Fax: (000) 000-0000; and in either case described in clause (i) or (ii) above;
with a copy to Cadwalader, Xxxxxxxxxx & Xxxx, 000 Xxxxxx Xxxx, Xxx Xxxx, Xxx
Xxxx 00000, Attn.: Xxxxx Xxxxxxx, Esq., Tel: (000) 000-0000, Fax: (000) 000-0000
BankBoston Facility
if to the Facility Lenders, as successors in interest to BankBoston, to: the
address provided for notice to the Facility Lenders pursuant to Section 16 of
the foregoing Agreement
Sources and Uses of Cash from Asset Sale
($ 000)
Sources:
Proceeds from Asset Sale $____
Reimbursement of corporate servicing advances $____
Less Discount 10.45% $____
Reimbursement of delinquent interest advance
Less discount
Net reimbursement $____
Total net sources of cash $____
Uses:
Transaction expenses and professional fees:
Debevoise & Xxxxxxxx
DLJ
Xxxxxx, Xxxxx
Bear, Xxxxxxx
Bear, Xxxxxxx
DMG
Greenwich Capital
Commercial Credit
Corewest settlement
Others (proxy solicitation,
accountants, etc.) ____
Total transaction expenses and professional
fees
Tax Escrow Amount
NLC 90-day warehouse financing
Securitization Escrow Amount
SafeCo shortfall
Delinquent interest advance shortfall
Warehouse shortfall
One-time working capital amount:
Vacation pay
Interest expense on November 15, 1999
Litigation costs
Accounts payable and accrued
expenses estimated at November 15, 1999
(IMC parent)
Accounts payable and accrued
expenses estimated at November 15, 1999
(subsidiaries)
Miscellaneous/unknown/working capital ____
Total one-time working capital amount ____
Total uses of cash ____
Excess of sources over uses of cash $____
