Exhibit 10.4
Execution Copy
GUARANTY
This GUARANTY is made and entered into by Anthracite Capital, Inc., a
Maryland corporation whose address is c/o BlackRock Financial Management, Inc.,
00 Xxxx 00xx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 ("Guarantor"), for the benefit of
Bank of America, N.A., whose address is Mail Code NC1-027-19-01, Hearst Tower,
000 Xxxxx Xxxxx Xxxxxx, Xxxxxxxxx, Xxxxx Xxxxxxxx 00000 (the "Buyer Agent") for
the benefit of Bank of America, N.A. ("BANA") and Banc of America Mortgage
Capital Corporation ("BAMCC", individually and/or collectively, as the context
may require, each a "Buyer" and collectively, the "Buyers"). This Guaranty is
made with reference to the following facts (with some capitalized terms being
defined below):
WHEREAS, the Buyers are considering entering into one or more
repurchase agreement transactions (the "Repurchase Transactions") up to a
maximum aggregate amount of Two Hundred Million Dollars ($200,000,000.00), with
Anthracite Capital BOFA Funding LLC, a Delaware limited liability company whose
address is c/o BlackRock Financial Management, Inc., 00 Xxxx 00xx Xxxxxx, Xxx
Xxxx, Xxx Xxxx 00000 ("Seller").
WHEREAS, in connection with the Repurchase Transactions, Seller, the
Buyer Agent and Buyers are entering into the following documents (collectively,
together with (x) this Guaranty, (y) any other documents executed by Seller or
Guarantor evidencing, securing or otherwise relating to the Repurchase
Transactions or this Guaranty and (z) any modifications, extensions, renewals,
restatements or replacements of any of the foregoing, the "Repurchase
Documents"): 1. that certain Master Repurchase Agreement between Seller, the
Buyer Agent and Buyers dated July 20, 2007, together with all annexes thereto
(as amended, modified and in effect from time to time, the "Repurchase
Agreement"); and 2. that certain Custodial Agreement among the Buyer Agent,
Seller and Custodian dated as of July 20, 2007, as amended, modified and in
effect from time to time.
WHEREAS, the Buyer Agent has examined, among other things, both
Seller's and Guarantor's creditworthiness and ability to pay and perform
Seller's obligations under the Repurchase Documents.
WHEREAS, the Buyer Agent and the Buyers have requested, as a condition
of entering into the Repurchase Agreement, that the obligations of Seller be
guarantied by Guarantor.
WHEREAS, Guarantor is the direct owner of 100% of the membership
interests of Seller.
WHEREAS, Guarantor expects to benefit if the Buyer Agent and the Buyers
enters into the Repurchase Agreement with Seller, and desires that the Buyer
Agent and the Buyers enter into the Repurchase Agreement with Seller.
WHEREAS, the Buyer Agent and the Buyers would not enter into, and would
not be obligated to enter into, the Repurchase Agreement with Seller unless
Guarantor executed this Guaranty. This Guaranty is therefore delivered to the
Buyer Agent to induce the Buyer Agent and the Buyers to enter into the
Repurchase Agreement.
NOW, THEREFORE, in exchange for good, adequate, and valuable
consideration, the receipt of which Guarantor acknowledges, and to induce the
Buyer Agent and the Buyers to enter into the Repurchase Agreement and accept the
Repurchase Documents, Guarantor agrees as follows:
1. DEFINITIONS. For purposes of this Guaranty, the following terms
shall be defined as set forth below. In addition, any capitalized term defined
in the Repurchase Agreement but not defined in this Guaranty shall have the same
meaning in this Guaranty as in the Repurchase Agreement.
1.1 "Adjusted Net Income" means, for any period, the Net Income of
Guarantor and its consolidated Subsidiaries for such period, determined on a
cash basis for such period without recognizing any trading portfolio gains or
losses in general, and specifically without giving effect to:
(a) depreciation and amortization,
(b) gains or losses that are classified as "extraordinary" in
accordance with GAAP,
(c) capital gains or losses on sales of real estate,
(d) capital gains or losses with respect to the disposition of
investments in marketable securities,
(e) any provision/benefit for income taxes for such period,
(f) earnings from equity investments and unconsolidated joint ventures
determined in accordance with GAAP,
(g) losses attributable to the impairment of assets,
(h) incentive fees paid in the form of the issuance of the Guarantor's
common stock,
(i) Cash Interest Expense,
(j) income or expense attributable to the ineffectiveness of hedging
transactions, and
(k) interest accretions, whether in favor or against the Guarantor.
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Without limiting the foregoing, Net Income shall be determined before
preferred stock dividends and shall include cash distributions from equity
investments and unconsolidated joint ventures.
1.2 "Capital Lease Obligations" means, for any Person, all obligations
of such Person to pay rent or other amounts under a lease of (or other agreement
conveying the right to use) Property to the extent such obligations are required
to be classified and accounted for as a capital lease on a balance sheet of such
Person under GAAP, and for purposes of this Guaranty, the amount of such
obligations shall be the capitalized amount thereof, determined in accordance
with GAAP.
1.3 "Cash" means cash on deposit in the Cash Management Account or in
any other account maintained by the Seller with any depository institution.
1.4 "Cash Interest Expense" means, for any period, total interest
expense, both expensed and capitalized, of Guarantor and its Subsidiaries for
such period with respect to the Total Recourse Indebtedness, determined on a
consolidated cash basis, for such period, and net of any interest accretions,
whether in favor or against, with respect to debt.
1.5 "Debt Service Coverage Ratio" or "DSCR" means, for any period, the
ratio of Adjusted Net Income to Cash Interest Expense on the Total Recourse
Indebtedness outstanding, it being understood that such determination shall be
made on a cash basis.
1.6 "Equity Proceeds" means any proceeds received from the sale or
issuance of any capital stock.
1.7 "Guarantied Obligations" means Seller's obligations: (a) to fully
and promptly pay all sums owed under the Repurchase Documents at the times and
according to the terms required by the Repurchase Documents, without regard to
any modification, suspension, or limitation of such terms not agreed to by the
Buyer Agent, such as a modification, suspension, or limitation arising in or
pursuant to any Insolvency Proceeding affecting Seller (even if any such
modification, suspension, or limitation causes Seller's obligation to become
discharged or unenforceable and even if such modification was made with the
Buyer Agent's consent or agreement); and (b) to perform all other obligations
contained in the Repurchase Documents, whether monetary or nonmonetary, when and
as required by the Repurchase Documents, including all obligations of Seller
relating to the Repurchase Transactions and the Security under the Repurchase
Documents.
1.8 "Indebtedness" means, for any Person without duplication: (a)
obligations created, issued or incurred by such Person for borrowed money
(whether by loan, the issuance and sale of debt securities or the sale of
Property to another Person subject to an understanding or agreement, contingent
or otherwise, to repurchase such Property from such Person); (b) obligations of
such Person to pay the deferred purchase or acquisition price of Property or
services, other than trade accounts payable (other than for borrowed money)
arising, and accrued expenses incurred, in the ordinary course of business so
long as such trade accounts payable are payable within ninety (90) days after
the date the respective goods are delivered or the respective services are
rendered; (c) Indebtedness of others secured by a Lien on the Property of such
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Person, whether or not the respective Indebtedness so secured has been assumed
by such Person; (d) obligations (contingent or otherwise) of such Person in
respect of letters of credit or similar instruments issued or accepted by banks
and other financial institutions for account of such Person; (e) Capital Lease
Obligations of such Person; (f) obligations of such Person under repurchase
agreements, sale/buy-back agreements or like arrangements; (g) Indebtedness of
others guarantied by such Person; (h) all obligations of such Person incurred in
connection with the acquisition or carrying of fixed assets by such Person; (i)
Indebtedness of general partnerships of which such Person is a general partner;
(j) net liabilities under Hedging Agreements, as determined in accordance with
GAAP; and (k) all Off-Balance Sheet Obligations of such Person
1.9 "Insolvency Proceeding" means any case under Title 11 of the United
States Code or any successor statute or any other insolvency, bankruptcy,
reorganization, liquidation, or like proceeding, or other statute or body of law
relating to creditors' rights, whether brought under state, federal, or foreign
law.
1.10 "Intangible Assets" means the excess of the cost over book value
of assets acquired, patents, trademarks, trade names, copyrights, franchises and
other intangible assets (excluding in any event the value of any residual
securities).
1.11 "Liens" means any mortgage, lien, pledge, charge, security
interest or similar encumbrance.
1.12 "Net Income" means, for any period and for Guarantor and its
consolidated Subsidiaries, the consolidated net income (or loss) of Guarantor
and its consolidated Subsidiaries for such period as determined on a
consolidated basis in accordance with GAAP as adjusted in accordance with the
terms hereof.
1.13 "Non-Recourse Indebtedness" means, with respect to any Person,
Indebtedness for borrowed money in respect of which recourse for payment (except
for customary exceptions for fraud, misapplication of funds, environmental
indemnities, and other customary exceptions to non-recourse provisions) is
contractually limited to specific assets encumbered by a Lien securing such
Indebtedness.
1.14 "Off-Balance Sheet Obligations" mean, with respect to any Person
and its consolidated Subsidiaries determined on a consolidated basis as of any
date of determination thereof, without duplication and to the extent not
included as a liability on the consolidated balance sheet of such Person and its
consolidated Subsidiaries in accordance with GAAP: (a) the monetary obligations
under any financing lease or so-called "synthetic", tax retention or off-balance
sheet lease transaction which, upon the application of any insolvency laws to
such Person or any of its consolidated Subsidiaries, would be characterized as
indebtedness; (b) the monetary obligations under any sale and leaseback
transaction which does not create a liability on the consolidated balance sheet
of such Person and its consolidated Subsidiaries; or (c) any other monetary
obligation arising with respect to any other transaction which (i) is
characterized as indebtedness for tax purposes but not for accounting purposes
in accordance with GAAP or (ii) is the functional equivalent of or takes the
place of borrowing but which does not constitute a liability on the consolidated
balance sheet of such Person and its consolidated Subsidiaries (for
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purposes of this clause (c), any transaction structured to provide tax
deductibility as interest expense of any dividend, coupon or other periodic
payment shall be deemed to be the functional equivalent of a borrowing).
1.15 "Property" means any right or interest in or to property of any
kind whatsoever, whether real, personal or mixed and whether tangible or
intangible.
1.16 "Security" means any security or collateral held by or for the
Buyer Agent, for the benefit of the Buyers, for the Repurchase Transactions or
the Guarantied Obligations, whether real or personal property, including any
mortgage, deed of trust, financing statement, security agreement, and other
security document or instrument of any kind securing the Repurchase Transactions
in whole or in part.
1.17 "Seller" means: (a) Seller as defined above, acting on its own
behalf; (b) any estate created by the commencement of an Insolvency Proceeding
affecting Seller; (c) any trustee, liquidator, sequestrator, or receiver of
Seller or Seller's property; and (d) any similar person duly appointed pursuant
to any law governing any Insolvency Proceeding of Seller.
1.18 "Subsidiary" means, as to any Person, a corporation, partnership,
limited liability company or other entity of which shares of stock or other
ownership interests having ordinary voting power (other than stock or such other
ownership interests having such power only by reason of a contingency) to elect
a majority of the board of directors or other managers of such corporation,
partnership, limited liability company or other entity are at the time owned, or
the management of which is otherwise controlled, directly or indirectly through
one or more intermediaries, or both, by such Person
1.19 "Tangible Net Worth" means, as of a particular date, (i) all
amounts that would be included under stockholder's equity on a balance sheet of
Guarantor and its consolidated Subsidiaries at such date, determined in
accordance with GAAP, less (ii) the sum of (A) amounts owing to Guarantor and
its consolidated Subsidiaries from Affiliates and (B) Intangible Assets of
Guarantor and its consolidated Subsidiaries.
1.20 "Tangible Net Worth Ratio" shall have the meaning provided in
Section 5.2 of this Guaranty.
1.21 "Total Recourse Indebtedness" means, for any period, the aggregate
Indebtedness (excepting any Non-Recourse Indebtedness) of Guarantor and its
consolidated Subsidiaries during such period.
1.22 "Unfunded Margin Amount" means, in respect of any Eligible Asset
on any date of determination, the positive difference, if any, between (a) the
Market Value in respect of such Eligible Asset and (b) the outstanding
Repurchase Price for such Eligible Asset.
2. ABSOLUTE GUARANTY OF ALL GUARANTIED OBLIGATIONS. Guarantor
unconditionally and irrevocably guarantees Seller's prompt and complete payment,
observance, fulfillment, and performance of all Guarantied Obligations.
Guarantor shall be personally liable for, and personally obligated to pay and
perform, all Guarantied Obligations.
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All assets and property of Guarantor shall be subject to recourse if Guarantor
fails to pay and perform any Guarantied Obligation(s) when and as required to be
paid and performed pursuant to the Repurchase Documents.
3. NATURE AND SCOPE OF LIABILITY. Guarantor's liability under this
Guaranty is primary and not secondary. Guarantor's liability under this Guaranty
shall be in the full amount of all Guarantied Obligations, including any
interest, default interest, costs and fees payable by Seller under the
Repurchase Documents, including any of the foregoing that would have accrued
under the Repurchase Documents but for any Insolvency Proceeding.
4. CHANGES IN REPURCHASE DOCUMENTS. Without notice to, or consent by,
Guarantor, and in the Buyer Agent's sole and absolute discretion and without
prejudice to the Buyer Agent or in any way limiting or reducing Guarantor's
liability under this Guaranty, but subject to the terms of the Repurchase
Agreement, the Buyer Agent, on behalf of the Buyers, may: (a) grant extensions
of time, renewals or other indulgences or modifications to Seller or any other
party under any of the Repurchase Document(s), (b) change, amend, or modify any
Repurchase Document(s), (c) authorize the sale, exchange, release or
subordination of any Security, (d) accept or reject additional Security in
accordance with the terms of the Repurchase Agreement, (e) discharge or release
any party or parties liable under the Repurchase Documents, (f) foreclose or
otherwise realize on any Security, or attempt to foreclose or otherwise realize
on any Security, whether such attempt is successful or unsuccessful, in
accordance with the terms of the Repurchase Agreement, (g) accept or make
compositions or other arrangements or file or refrain from filing a claim in any
Insolvency Proceeding, (h) make loans to Seller in such amount(s) and at such
time(s) as the Buyer Agent may determine, (i) credit payments in such manner and
order of priority as the Buyer Agent may determine in its discretion, provided
that such credits shall be consistent with the requirements of the Repurchase
Agreement and (j) otherwise deal with Seller and any other party related to the
Repurchase Transactions or any Security as the Buyer Agent may determine in its
sole and absolute discretion. Without limiting the generality of the foregoing,
Guarantor's liability under this Guaranty shall continue even if the Buyer Agent
alters any obligations under the Repurchase Documents in any respect or any
Buyer's, the Buyer Agent's or Guarantor's remedies or rights against Seller are
in any way impaired or suspended without Guarantor's consent. If the Buyer Agent
performs any of the actions described in this paragraph, then Guarantor's
liability shall continue in full force and effect even if the Buyer Agent's
actions impair, diminish or eliminate Guarantor's subrogation, contribution, or
reimbursement rights (if any) against Seller.
5. CERTAIN FINANCIAL COVENANTS. Guarantor shall satisfy with respect to
itself each of the following financial covenants, as determined quarterly on a
consolidated basis in conformity with GAAP as set forth in the financial
statements of Guarantor delivered pursuant to Section 15 hereof:
5.1 Maintenance of Tangible Net Worth. Tangible Net Worth at the end of
each fiscal quarter shall not be less than the sum of (i) $400,000,000, plus,
(ii) an amount equal to 75% of any Equity Proceeds;
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5.2 Maintenance of Ratio of Total Recourse Indebtedness to Tangible Net
Worth. The ratio of Total Recourse Indebtedness to Tangible Net Worth (the
"Tangible Net Worth Ratio") at the end of each fiscal quarter shall not be
greater than 3.0:1.0;
5.3 Minimum DSCR. DSCR at the end of each fiscal quarter shall not be
less than 1.20:1.00; and
5.4 Maintenance of Liquidity. The sum of (i) Cash, plus, (ii)
unencumbered and unpledged marketable securities plus, (iii) the Unfunded Margin
Amount at the end of each fiscal quarter shall not be less than $10,000,000;
provided, that compliance with clauses 5.1 through 5.4 above shall be
determined by excluding the assets and liabilities of variable interest entities
required to be consolidated under FIN 46R and without giving any effect to any
changes in or in the interpretation of FAS 140 after the date hereof.
6. NATURE OF GUARANTY. Guarantor's liability under this Guaranty is a
guaranty of payment and performance of the Guarantied Obligations, and is not a
guaranty of collection or collectability. Guarantor's liability under this
Guaranty is not conditioned or contingent upon the genuineness, validity,
regularity or enforceability of any of the Repurchase Documents. Guarantor's
liability under this Guaranty is a continuing, absolute, and unconditional
obligation under any and all circumstances whatsoever (except as expressly
stated, if at all, in this Guaranty), without regard to the validity, regularity
or enforceability of any of the Guarantied Obligations. Guarantor acknowledges
that Guarantor is fully obligated under this Guaranty even if Seller had no
liability at the time of execution of the Repurchase Documents or later ceases
to be liable under any Repurchase Document, whether pursuant to Insolvency
Proceedings or otherwise. Guarantor shall not be entitled to claim, and
irrevocably covenants not to raise or assert, any defenses against the
Guarantied Obligations that would or might be available to Seller, other than
actual payment and performance of all Guarantied Obligations in full in
accordance with their terms. Guarantor waives any right to compel the Buyer
Agent to proceed first against Seller or any Security before proceeding against
Guarantor. Guarantor agrees that if any of the Guarantied Obligations are or
become void or unenforceable (because of inadequate consideration, lack of
capacity, Insolvency Proceedings, or for any other reason), then Guarantor's
liability under this Guaranty shall continue in full force with respect to all
Guarantied Obligations as if they were and continued to be legally enforceable,
all in accordance with their terms before giving effect to the Insolvency
Proceedings. Guarantor also recognizes and acknowledges that its liability under
this Guaranty may be more extensive in amount and more burdensome than that of
Seller. Guarantor waives any defense that might otherwise be available to
Guarantor based on the proposition that a guarantor's liability cannot exceed
the liability of the principal. Guarantor intends to be fully liable under the
Guarantied Obligations regardless of the scope of Seller's liability thereunder.
Without limiting the generality of the foregoing, if the Guarantied Obligations
are "nonrecourse" as to Seller or Seller's liability for the Guarantied
Obligations is otherwise limited in some way, Guarantor nevertheless intends to
be fully liable, to the full extent of all of Guarantor's assets, with respect
to all the Guarantied Obligations, even though Seller's liability for the
Guarantied Obligations may be more limited in scope or less burdensome.
Guarantor waives any defenses to this Guaranty arising or purportedly arising
from the manner in which any Buyer or the Buyer Agent disburses the
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Xxxxxxxxxx Transactions to Seller or otherwise, or any waiver of the terms of
any Repurchase Document by the Buyer Agent or other failure of the Buyer Agent
to require full compliance with the Repurchase Documents. Guarantor's liability
under this Guaranty shall continue until all sums due under the Repurchase
Documents have been paid in full and all other performance required under the
Repurchase Documents has been rendered in full, except as expressly provided
otherwise (if at all) in this Guaranty. Guarantor's liability under this
Guaranty shall not be limited or affected in any way by any impairment or any
diminution or loss of value of any Security whether caused by (a) hazardous
substances, (b) the Buyer Agent's failure to perfect a security interest in any
Security, (c) any disability or other defense(s) of Seller, (d) any acts or
omissions of the Buyers or the Buyer Agent; or (e) any breach by Seller of any
representation or warranty contained in any Repurchase Document.
7. WAIVERS OF RIGHTS AND DEFENSES. Guarantor waives any right to
require the Buyer Agent or any Buyer to (a) proceed against Seller, (b) proceed
against or exhaust any Security, or (c) pursue any other right or remedy for
Guarantor's benefit. Guarantor agrees that the Buyer Agent may proceed against
Guarantor with respect to the Guarantied Obligations without taking any actions
against Seller and without proceeding against or exhausting any Security.
Guarantor agrees that the Buyer Agent may unqualifiedly exercise in its sole
discretion (or may waive or release, intentionally or unintentionally) any or
all rights and remedies available to it against Seller without impairing the
Buyer Agent's rights and remedies in enforcing this Guaranty, under which
Guarantor's liabilities shall remain independent and unconditional. Guarantor
agrees and acknowledges that the Buyer Agent's exercise (or waiver or release)
of certain of such rights or remedies may affect or eliminate Guarantor's right
of subrogation or recovery against Seller (if any) and that Guarantor may incur
a partially or totally nonreimbursible liability in performing under this
Guaranty. Guarantor has assumed the risk of any such loss of subrogation rights,
even if caused by the Buyer Agent's acts or omissions. If the Buyer Agent's
enforcement of rights and remedies, or the manner thereof, limits or precludes
Guarantor from exercising any right of subrogation that might otherwise exist,
then the foregoing shall not in any way limit the Buyer Agent's rights to
enforce this Guaranty. Without limiting the generality of any other waivers in
this Guaranty, Guarantor expressly waives any statutory or other right that
Guarantor might otherwise have to: (i) limit Guarantor's liability after a
nonjudicial foreclosure sale conducted in accordance with the terms of the
Repurchase Agreement and applicable law to the difference between the Guarantied
Obligations and the fair market value of the property or interests sold at such
nonjudicial foreclosure sale or to any other extent, (ii) otherwise limit the
Buyer Agent's right to recover a deficiency judgment after any foreclosure sale
conducted in accordance with the terms of the Repurchase Agreement and
applicable law, or (iii) require the Buyer Agent to exhaust its Security before
the Buyer Agent may obtain, for the benefit of the Buyers, a personal judgment
for any deficiency. Notwithstanding anything in the Repurchase Agreement to the
contrary, any proceeds of a foreclosure or similar sale shall be applied first
to any obligations of Seller that also constitute Guarantied Obligations within
the meaning of this Guaranty. Guarantor acknowledges and agrees that any
nonrecourse or exculpation provided for in any Repurchase Document, or any other
provision of a Repurchase Document limiting the Buyer Agent's recourse to
specific Security or limiting the Buyer Agent's right to enforce a deficiency
judgment against Seller or any other person, shall have absolutely no
application to Guarantor's liability under this Guaranty.
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8. ADDITIONAL WAIVERS. Guarantor waives diligence and all demands,
protests, presentments and notices of every kind or nature, including notices of
protest, dishonor, nonpayment, acceptance of this Guaranty and the creation,
renewal, extension, modification or accrual of any of the Guarantied
Obligations. Guarantor further waives the right to plead any and all statutes of
limitations as a defense to Guarantor's liability under this Guaranty or the
enforcement of this Guaranty. No failure or delay on the Buyer Agent's part in
exercising any power, right or privilege under this Guaranty shall impair or
waive any such power, right or privilege.
9. NO DUTY TO PROVE LOSS. To the extent that Guarantor at any time
incurs any liability under this Guaranty, Guarantor shall immediately pay the
Buyer Agent (to be applied on account of the Guarantied Obligations) the amount
provided for in this Guaranty, without any requirement that the Buyer Agent
demonstrate that the Buyer Agent or any Buyer has currently suffered any loss or
that the Buyer Agent or any Buyer has otherwise exercised (to any degree) or
exhausted any of the Buyer Agent's or Buyers' rights or remedies with respect to
Seller or any Security.
10. FULL KNOWLEDGE. Guarantor acknowledges, represents, and warrants
that Guarantor has had a full and adequate opportunity to review the Repurchase
Documents, the transactions contemplated by the Repurchase Documents, and all
underlying facts relating to such transactions. Guarantor represents and
warrants that Guarantor fully understands: (a) the remedies the Buyer Agent
and/or the Buyers may pursue against Seller and/or Guarantor in the event of a
default under the Repurchase Documents, (b) the value (if any) and character of
any Security and (c) Seller's financial condition and ability to perform under
the Repurchase Documents. Guarantor agrees to keep itself fully informed
regarding all aspects of the foregoing and the performance of Seller's
obligations to the Buyer Agent and the Buyers. Neither Buyer Agent nor any Buyer
has a duty, whether now or in the future, to disclose to Guarantor any
information pertaining to Seller, the Repurchase Transactions or any Security.
If at any time provided for in the Repurchase Documents, Guarantor agrees and
acknowledges that an Insolvency Proceeding affecting Guarantor, or other actions
or events relating to Guarantor (including Guarantor's change in financial
position), as set forth in the Repurchase Documents, may be event(s) of default
under the Repurchase Documents.
11. REPRESENTATIONS AND WARRANTIES. Guarantor acknowledges, represents,
and warrants as follows, and acknowledges that the Buyer Agent is relying upon
the following acknowledgments, representations, and warranties by Guarantor in
making the Repurchase Transactions:
11.1 Due Authorization. This Guaranty has been duly authorized,
executed, and delivered by Guarantor, and is a legally valid and binding
obligation of Guarantor, enforceable against Guarantor in accordance with its
terms, subject to bankruptcy, insolvency and other limitations on creditors'
rights generally and to equitable principles.
11.2 No Conflict. The execution, delivery, and performance of this
Guaranty will not violate any provision of any law, regulation, judgment, order,
decree, determination, or award of any court, arbitrator or governmental
authority, or of any mortgage, indenture, loan, or
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security agreement, lease, contract or other agreement, instrument or
undertaking to which Guarantor is a party or that purports to bind Guarantor or
any of Guarantor's property or assets.
11.3 No Third Party Consent Required. No consent of any person
(including creditors or partners, members, stockholders or other owners of
Guarantor) is required in connection with Guarantor's execution of this Guaranty
or performance of Guarantor's obligations under this Guaranty (other than
consents that have been obtained). Guarantor's execution of, and obligations
under, this Guaranty are not contingent upon any consent, license, permit,
approval or authorization of, exemption by, notice or report to or registration,
filing or declaration with, any governmental authority, bureau or agency,
whether local, state, federal or foreign.
11.4 Authority and Execution. Guarantor has the necessary corporate
power and authority to execute, deliver and perform its obligations under this
Guaranty.
11.5 No Representations by the Buyer Agent nor the Buyers. Guarantor
delivers this Guaranty based solely upon Guarantor's own independent
investigation and based in no part upon any representation, statement, or
assurance by the Buyer Agent or the Buyers.
12. REIMBURSEMENT AND SUBROGATION RIGHTS. Except to the extent that the
Buyer Agent notifies Guarantor to the contrary in writing from time to time:
12.1 General Deferral of Reimbursement. Guarantor waives any right to
be reimbursed by Seller for any payment(s) made by Guarantor on account of the
Guarantied Obligations, unless and until all Guarantied Obligations have been
paid in full and all periods within which such payments may be set aside or
invalidated have expired. Guarantor acknowledges that Guarantor has received
adequate consideration for execution of this Guaranty by virtue of the Buyers'
entering into the Repurchase Transactions (which benefits Guarantor, as an owner
or principal of Seller) and Guarantor does not require or expect, and is not
entitled to, any other right of reimbursement against Seller as consideration
for this Guaranty.
12.2 Deferral of Subrogation and Contribution. Guarantor agrees it
shall have no right of subrogation against Seller, the Buyers or the Buyer Agent
and no right of subrogation against any Security unless and until: (a) all
amounts due under the Repurchase Documents have been paid in full and all other
performance required under the Repurchase Documents has been rendered in full to
the Buyer Agent and the Buyers; and (b) all periods within which such payment
and performance may be set aside or invalidated have expired (such deferral of
Guarantor's subrogation and contribution rights, the "Subrogation Deferral").
12.3 Effect of Invalidation. To the extent that a court of competent
jurisdiction determines that Guarantor's Subrogation Deferral is void or
voidable for any reason, Guarantor agrees, notwithstanding any acts or omissions
by the Buyers or the Buyer Agent, that Guarantor's rights of subrogation against
Seller, the Buyer Agent and Guarantor's right of subrogation against any
Security shall at all times be junior and subordinate to the Buyer Agent's
rights against Seller and to the Buyer Agent's right, title, and interest in
such Security.
13. CLAIMS IN INSOLVENCY PROCEEDING. Guarantor shall not file any claim
in any Insolvency Proceeding affecting Seller unless Guarantor simultaneously
assigns
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and transfers such claim to the Buyer Agent, without consideration, pursuant to
documentation fully satisfactory to the Buyer Agent. Guarantor shall
automatically be deemed to have assigned and transferred such claim to the Buyer
Agent whether or not Guarantor executes documentation to such effect. By
executing this Guaranty, Guarantor hereby authorizes the Buyer Agent (and grants
the Buyer Agent a power of attorney coupled with an interest, and hence
irrevocable) to execute and file such assignment and transfer documentation on
Guarantor's behalf. the Buyer Agent shall have the sole right to vote, receive
distributions on and exercise all other rights with respect to any such claim;
provided, however, that if and when the Guarantied Obligations have been paid in
full, the Buyer Agent shall release to Guarantor any further payments received
on account of any such claim.
14. BUYER'S DISGORGEMENT OF PAYMENTS. Upon payment of all or any
portion of the Guarantied Obligations, Guarantor's obligations under this
Guaranty shall continue and remain in full force and effect if all or any part
of such payment is, pursuant to any Insolvency Proceeding or otherwise, avoided
or recovered directly or indirectly from the Buyer Agent as a preference,
fraudulent transfer, or otherwise irrespective of (a) any notice of revocation
given by Guarantor prior to such avoidance or recovery or (b) payment in full of
the Repurchase Transactions. Guarantor's liability under this Guaranty shall
continue until all periods have expired within which the Buyer Agent could (on
account of Insolvency Proceedings, whether or not then pending, affecting Seller
or any other person) be required to return, repay, or disgorge any amount paid
at any time on account of the Guarantied Obligations.
15. FINANCIAL INFORMATION. Within ninety days after the end of each
fiscal year of Guarantor and within forty-five days after the end of each of the
first three fiscal quarters, Guarantor shall deliver to the Buyer Agent the
financial statements of Guarantor (audited for the annual financial statements
and unaudited for the financial statements of the first three fiscal quarters),
together with an officer's certificate addressed to the Buyer Agent certifying
that, as of the end of such fiscal quarter or fiscal year, as applicable,
Guarantor was in compliance with each of the financial covenants contained in
Section 5 of this Guaranty and showing in reasonable detail the calculations
demonstrating such compliance.
16. CONSENT TO JURISDICTION. Guarantor agrees that any proceeding to
enforce this Guaranty may be brought in any state or federal court located in
the State of New York. By executing this Guaranty, Guarantor irrevocably accepts
and submits to the nonexclusive jurisdiction of each of the aforesaid courts,
generally and unconditionally with respect to any such proceeding.
17. MERGER; NO CONDITIONS; AMENDMENTS. This Guaranty and documents
referred to herein contain the entire agreement among the parties with respect
to the matters set forth in this Guaranty. This Guaranty supersedes all prior
agreements among the parties with respect to the matters set forth in this
Guaranty. No course of prior dealings among the parties, no usage of trade, and
no parol or extrinsic evidence of any nature shall be used to supplement,
modify, or vary any terms of this Guaranty. This Guaranty is unconditional.
There are no unsatisfied conditions to the full effectiveness of this Guaranty.
No terms or provisions of this Guaranty may be changed, waived, revoked, or
amended without the written agreement of the parties hereto. If any provision of
this Guaranty is determined to be unenforceable, then all other provisions of
this Guaranty shall remain fully effective.
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18. GOVERNING LAW; ENFORCEMENT. This Guaranty shall be governed and
construed in accordance with the internal laws of the State of New York (without
regard to conflict of laws principles), notwithstanding the location of any
Security. Guarantor acknowledges that any restrictions, limitations and
prohibitions set forth in New York Real Property Actions and Proceedings Law
Sections 1301 and 1371 that would or might otherwise limit or establish
conditions to the Buyer Agent's recovery of a judgment against Guarantor if the
Security were located in the State of New York shall have absolutely no
application to the Buyer Agent's enforcement of this Guaranty as against
Guarantor, except to the extent that real property Security is located within
the State of New York. Guarantor acknowledges that this Guaranty is an
"instrument for the payment of money only," within the meaning of New York Civil
Practice Law and Rules Section 3213.
19. FURTHER ASSURANCES. Guarantor shall execute and deliver such
further documents, and perform such further acts, as the Buyer Agent may
reasonably request to achieve the intent of the parties as expressed in this
Guaranty, provided, in each case, that any such documentation is consistent with
this Guaranty and with the Repurchase Documents.
20. WAIVER OF TRIAL BY JURY. GUARANTOR WAIVES TRIAL BY JURY IN ANY
ACTION OR PROCEEDING ARISING FROM OR RELATING TO THIS GUARANTY OR THE REPURCHASE
DOCUMENTS OR ANY OBLIGATION(S) OF GUARANTOR HEREUNDER OR UNDER THE REPURCHASE
DOCUMENTS.
21. MISCELLANEOUS.
21.1 Assignability. the Buyer Agent may assign this Guaranty (in whole
or in part) together with any one or more of the Repurchase Documents to any
Person permitted under the Repurchase Agreement, without in any way affecting
Guarantor's or Seller's liability. In connection with any such assignment,
Guarantor shall deliver such documentation as the Buyer Agent shall reasonably
request. This Guaranty shall benefit the Buyer Agent and its successors and
permitted assigns and shall bind Guarantor and its heirs, executors,
administrators and successors. Guarantor may not assign this Guaranty, in whole
or in part.
21.2 Notices. All notices, consents, approvals and requests required or
permitted hereunder shall be given in writing and shall be effective for all
purposes if hand delivered or sent by (i) hand delivery, with proof of attempted
delivery, (ii) certified or registered United States mail, postage prepaid,
(iii) expedited prepaid delivery service, either commercial or United States
Postal Service, with proof of delivery or (iv) by facsimile (with transmission
confirmation), provided that such faxed notice must also be delivered by one of
the means set forth in (i), (ii) or (iii) above, addressed if to the Buyer Agent
at Bank of America, N.A., Mail Code: NC1-027-19-01, Hearst Tower, 000 Xxxxx
Xxxxx Xxxxxx, Xxxxxxxxx, XX 00000, Attention: Xxxxxxxxxxx Xxxxx, Vice President,
Portfolio Management, Facsimile: (000) 000-0000, and if to Guarantor at c/o
BlackRock Financial Management, Inc., 00 Xxxx 00xx Xxxxxx, Xxx Xxxx, XX 00000,
Attention: Mr. Xxxxxxx Xxxx, Facsimile No. (000) 000-0000, or at such other
address and person as shall be designated from time to time by any party hereto,
as the case may be, in a written notice to the other parties hereto in the
manner provided for in this Section. A copy of all notices directed to Guarantor
shall be delivered concurrently to the following: Xxxxxx & Xxxxxxx LLP, 000
Xxxxx Xxx., Xxx Xxxx, XX 00000, Attn: Xxxxx Xxxxxxx (028354-0040),
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Facsimile No.: (000) 000 0000. A notice shall be deemed to have been given: (x)
in the case of hand delivery, registered or certified mail or expedited prepaid
delivery service, at the time of delivery or (y) in the case of facsimile, upon
receipt of transmission confirmation, provided that such faxed notice was also
delivered as required in this Section. A party receiving a notice which does not
comply with the technical requirements for notice under this Section may elect
to waive any deficiencies and treat the notice as properly given.
21.3 Interpretation. The word "include" and its variants shall be
interpreted in each case as if followed by the words "without limitation."
21.4 Counterparts. This Guaranty may be executed in counterparts, each
of which so executed shall be deemed to be an original, but all of such
counterparts shall together constitute but one and the same instrument.
22. BUSINESS PURPOSES. Guarantor acknowledges that this Guaranty,
although executed in Guarantor's individual capacity, is executed and delivered
for business and commercial purposes, and not for personal, family, household,
consumer or agricultural purposes. Guarantor acknowledges that Guarantor is not
entitled to, and does not require the benefits of, any rights, protections, or
disclosures that would or may be required if this Guaranty were given for
personal, family, household, consumer, or agricultural purposes. Guarantor
acknowledges that none of Guarantor's obligation(s) under this Guaranty
constitute(s) a "debt" within the meaning of the United States Fair Debt
Collection Practices Act, 15 U.S.C. ss. 1692a(5), and accordingly compliance
with the requirements of such act is not required if the Buyer Agent (directly
or acting through its counsel) makes any demand or commences any action to
enforce this Guaranty.
23. NO THIRD-PARTY BENEFICIARIES. This Guaranty is executed and
delivered for the benefit of the Buyer Agent, for the benefit of the Buyers, and
its heirs, successors, and permitted assigns, and is not intended to benefit any
third party.
24. CERTAIN ACKNOWLEDGMENTS BY GUARANTOR. GUARANTOR ACKNOWLEDGES THAT
BEFORE EXECUTING THIS GUARANTY: (A) GUARANTOR HAS HAD THE OPPORTUNITY TO REVIEW
IT WITH AN ATTORNEY OF GUARANTOR'S CHOICE; (B) THE BUYER AGENT HAS RECOMMENDED
TO GUARANTOR THAT GUARANTOR OBTAIN SEPARATE COUNSEL, INDEPENDENT OF SELLER'S
COUNSEL, REGARDING THIS GUARANTY; AND (C) GUARANTOR HAS CAREFULLY READ THIS
GUARANTY AND UNDERSTOOD THE MEANING AND EFFECT OF ITS TERMS, INCLUDING ALL
WAIVERS AND ACKNOWLEDGMENTS CONTAINED IN THIS GUARANTY AND THE FULL EFFECT OF
SUCH WAIVERS AND THE SCOPE OF GUARANTOR'S OBLIGATIONS UNDER THIS GUARANTY.
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IN WITNESS WHEREOF, Guarantor has duly executed this Guaranty as of the
date indicated below.
Date: July 20, 2007
GUARANTOR
Anthracite Capital, Inc.
By: /s/ Xxxxxxx Xxxx
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Name: Xxxxxxx Xxxx
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Title:
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Acknowledgment(s)
Bank of America, N.A., as buyer agent
By: /s/ Xxxxx Xxxxxxx
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Name: Xxxxx Xxxxxxx
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Title: Managing Director
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Anthracite Capital BOFA Funding LLC
By: Anthracite Capital, Inc., its sole member
By: /s/ Xxxxxxx Xxxx
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Name: Xxxxxxx Xxxx
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Title:
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