Exhibit 10(ag)
AMENDED AND RESTATED MORTGAGE WAREHOUSING
CREDIT AND SECURITY AGREEMENT
Dated as of March 18, 2005
Among
CHARTERMAC MORTGAGE CAPITAL CORPORATION,
BORROWER
FLEET NATIONAL BANK
AGENT
and
THE LENDERS NAMED HEREIN FROM TIME TO TIME
(INCLUDING FLEET NATIONAL BANK IN SUCH CAPACITY)
LENDERS
Up to $100,000,000
TABLE OF CONTENTS
-----------------
PAGE
----
1 BACKGROUND. 1
1.1 DEFINED TERMS................................................................1
1.2 CONTINUATION OF FACILITY.....................................................1
1.3 GUARANTOR....................................................................1
1.4 GENERAL......................................................................1
1.5 ACCOUNTING PRINCIPLES........................................................1
2 LOAN PROVISIONS. 2
2.1 THE FACILITY.................................................................2
2.2 TERM OF LOAN.................................................................3
2.3 WAREHOUSING ADVANCES.........................................................3
2.4 INTEREST RATE AND PAYMENT TERMS..............................................3
2.5 LOAN FEES....................................................................7
2.6 ACCELERATION.................................................................7
3 SECURITY FOR THE FACILITY. 7
3.1 GRANT OF SECURITY INTEREST...................................................7
3.2 AUTHENTICATED RECORD.........................................................9
3.3 RELEASE OF SECURITY INTEREST IN PLEDGED ASSETS...............................9
3.4 COLLECTION AND SERVICING RIGHTS.............................................10
3.5 RETURN OF COLLATERAL AT END OF WAREHOUSING COMMITMENT.......................10
3.6 DELIVERY OF COLLATERAL DOCUMENTS............................................10
3.7 LOAN DOCUMENTS AND SECURITY DOCUMENTS.......................................10
4 CONTINUING AUTHORITY OF AUTHORIZED REPRESENTATIVES 11
5 CONDITIONS PRECEDENT. 11
5.1 ESTABLISHMENT OF FACILITY AND FUNDING INITIAL WAREHOUSING ADVANCE...........11
5.2 WAREHOUSING ADVANCES........................................................13
6 WARRANTIES AND REPRESENTATIONS 14
6.1 FINANCIAL INFORMATION.......................................................14
6.2 NO VIOLATIONS...............................................................14
6.3 NO LITIGATION...............................................................14
6.4 FRANCHISES, PATENTS, COPYRIGHTS, ETC........................................14
6.5 GOOD TITLE AND NO LIENS.....................................................14
6.6 USE OF PROCEEDS.............................................................14
6.7 ORGANIZATION................................................................14
6.8 VALID AND BINDING...........................................................15
6.9 DEFERRED COMPENSATION AND ERISA.............................................15
6.10 NO MATERIALLY ADVERSE CONTRACTS, ETC........................................16
6.11 COMPLIANCE WITH OTHER INSTRUMENTS, LAWS, ETC................................16
6.12 TAX STATUS..................................................................16
6.13 HOLDING COMPANY AND INVESTMENT COMPANY ACTS.................................16
6.14 CERTAIN TRANSACTIONS........................................................16
6.15 REGULATIONS U AND X.........................................................16
i
6.16 LOAN DOCUMENTS..............................................................16
6.17 NO MATERIAL CHANGE: NO DEFAULT..............................................16
6.18 NO BROKER OR FINDER.........................................................17
6.19 BACKGROUND INFORMATION AND CERTIFICATES.....................................17
6.20 SERVICING...................................................................17
6.21 ASSUMED NAMES...............................................................17
7 COVENANTS 17
7.1 PUNCTUAL PAYMENT............................................................17
7.2 MAINTENANCE OF OFFICE.......................................................17
7.3 RECORDS AND ACCOUNTS........................................................17
7.4 NOTICES.....................................................................17
7.5 FINANCIAL STATEMENTS AND REPORTS............................................18
7.6 EXISTENCE; CONDUCT OF BUSINESS..............................................19
7.7 INSURANCE...................................................................20
7.8 TAXES AND TRADE DEBT........................................................20
7.9 COMPLIANCE WITH LAWS, CONTRACTS, LICENSES, AND PERMITS......................20
7.10 BANK ACCOUNTS...............................................................20
7.11 CLOSING INSTRUCTIONS........................................................20
7.12 OTHER LOAN OBLIGATIONS......................................................21
7.13 FURTHER ASSURANCES..........................................................21
7.14 RESTRICTIONS ON LIENS, TRANSFERS AND ADDITIONAL DEBT........................21
7.15 DISTRIBUTIONS...............................................................23
7.16 RESTRICTIONS ON INVESTMENTS.................................................23
7.17 INDEMNIFICATION AGAINST PAYMENT OF BROKERS' FEES............................23
7.18 MERGER, CONSOLIDATION.......................................................23
7.19 SUBSIDIARIES................................................................24
7.20 LOANS AND ADVANCES..........................................................24
7.21 FISCAL YEAR.................................................................24
7.22 CHARGING ACCOUNTS...........................................................24
7.23 PLACE FOR RECORDS; INSPECTION...............................................24
7.24 COSTS AND EXPENSES..........................................................25
7.25 INDEMNIFICATION.............................................................25
7.26 FINANCIAL COVENANTS.........................................................26
7.27 REPLACEMENT DOCUMENTATION...................................................26
7.28 ADDITIONAL FACILITIES CO-TERMINOUS AND CROSS DEFAULTED......................26
7.29 PLEDGE OF SERVICING CONTRACTS...............................................27
7.30 RECOURSE SERVICING CONTRACTS................................................27
7.31 GESTATION AGREEMENTS........................................................27
7.32 NO SUBSIDIARIES.............................................................27
8 SPECIAL REPRESENTATIONS, WARRANTIES AND COVENANTS CONCERNING COLLATERAL 27
8.1 SPECIAL REPRESENTATIONS AND WARRANTIES CONCERNING ELIGIBILITY AS
SELLER/SERVICER OF MORTGAGE LOANS...........................................27
8.2 SPECIAL REPRESENTATIONS AND WARRANTIES CONCERNING WAREHOUSING COLLATERAL....27
8.3 SPECIAL AFFIRMATIVE COVENANTS CONCERNING WAREHOUSING COLLATERAL.............29
8.4 SPECIAL NEGATIVE COVENANTS CONCERNING WAREHOUSING COLLATERAL................30
8.5 SPECIAL REPRESENTATION AND WARRANTY CONCERNING ▇▇▇▇▇▇ ▇▇▇ DUS PROGRAM
RESERVE REQUIREMENTS........................................................30
8.6 SPECIAL REPRESENTATIONS AND WARRANTIES CONCERNING FHA PROJECT MORTGAGE
LOANS.......................................................................30
8.7 SPECIAL REPRESENTATIONS AND WARRANTIES CONCERNING SERVICING COLLATERAL......31
ii
9 EVENTS OF DEFAULT 31
9.1 DEFAULT AND EVENTS OF DEFAULT...............................................31
9.2 WRITTEN WAIVERS.............................................................33
9.3 REMEDIES....................................................................33
10 SECURITY INTEREST AND SET-OFF. 35
10.1 SECURITY INTEREST...........................................................36
10.2 SET-OFF.....................................................................36
10.3 RIGHT TO FREEZE.............................................................36
10.4 ADDITIONAL RIGHTS...........................................................36
11 THE AGENT AND THE LENDERS 36
11.1 RIGHTS, DUTIES AND IMMUNITIES OF THE AGENT..................................36
11.2 RESPECTING LOANS AND PAYMENTS...............................................39
11.3 ASSIGNMENT AND PARTICIPATION................................................42
11.4 ADMINISTRATIVE MATTERS......................................................44
12 GENERAL PROVISIONS. 45
12.1 NOTICES.....................................................................45
12.2 PAYMENTS TO BE CHARGED AS AN ADVANCE........................................46
12.3 PARTIES BOUND; INTEGRATION..................................................46
12.4 WAIVERS, EXTENSIONS AND RELEASES............................................47
12.5 GOVERNING LAW; CONSENT TO JURISDICTION; MUTUAL WAIVER OF JURY TRIAL.........47
12.6 CONSENT TO JURISDICTION.....................................................47
12.7 JURY TRIAL WAIVER...........................................................47
12.8 SURVIVAL....................................................................47
12.9 CUMULATIVE RIGHTS...........................................................48
12.10 CLAIMS AGAINST AGENT OR LENDERS.............................................48
12.11 OBLIGATIONS ABSOLUTE........................................................48
12.12 COUNTERPARTS................................................................48
12.13 TIME OF THE ESSENCE.........................................................48
12.14 NO ORAL CHANGE..............................................................49
12.15 MONTHLY STATEMENTS..........................................................49
iii
EXHIBITS AND SCHEDULES:
----------------------
SECTION REFERENCE
-----------------
NUMBER
------
Exhibit A - Definitions 1.1
Exhibit B - Procedures and Documentation for Warehousing Advances 2.3.2
Exhibit C - Form of Request for Warehousing Advances 2.3.2
Exhibit D - Eligible Loans and Other Assets 2.1.3
Exhibit E - Form of Assignment and Acceptance Agreement 11.3.1
Exhibit F - Form of Lenders' Notes
Exhibit G - Form of Compliance Certificate
Exhibit H - Commitment Increase Supplement
Schedule 1 - Lenders and Commitments
Schedule 4 - Authorized Representatives 4
Schedule 6.3 - Litigation
Schedule 6.7.1 - Ownership, Subsidiaries and Taxpayer Identification Numbers
Schedule 6.14 - Certain Transactions
Schedule 6.20 - Servicing Portfolio
Schedule 6.21 - Assumed Names
Schedule 7.7 - Insurance
Schedule 7.12 - Indebtedness of Borrower and its Subsidiaries
Schedule 7.14.1 - Other Indebtedness
Schedule 7.14.2 - Other Liens
iv
AMENDED AND RESTATED MORTGAGE WAREHOUSING
-----------------------------------------
CREDIT AND SECURITY AGREEMENT
-----------------------------
THIS AMENDED AND RESTATED MORTGAGE WAREHOUSING CREDIT AND SECURITY
AGREEMENT is made and entered into as of the 18th day of March, 2005, among
CHARTERMAC MORTGAGE CAPITAL CORPORATION, a Delaware corporation (the
"Borrower"), FLEET NATIONAL BANK as a Lender (as defined in EXHIBIT A) and as
agent (in such capacity, the "Agent") for itself and the other Lenders, and such
Lenders.
FOR GOOD AND VALUABLE CONSIDERATION, the receipt and sufficiency of which
are hereby acknowledged, the parties agree as follows:
1. BACKGROUND.
----------
1.1 DEFINED TERMS. Capitalized terms used in this Agreement which are not
otherwise defined herein are defined either in EXHIBIT A, or in another Loan
Document, as provided in EXHIBIT A.
1.2 CONTINUATION OF FACILITY. At the Borrower's request, the Lenders
previously established this secured mortgage warehousing facility (the
"Facility") pursuant to that certain Mortgage Warehousing Credit and Security
Agreement, dated as of December 24, 2001 (the "Original Agreement"), the
proceeds of the Warehousing Advances made under which have been used by the
Borrower to fund Eligible Loans. The Borrower has also requested that the
Lenders continue to make available the Facility, and in response to such
request, the Lenders are willing to amend and restate the Original Agreement and
to renew the Facility upon the terms and conditions set forth herein, it being
the intention of the parties that such amendment and restatement shall
constitute a continuation, rather than a novation, of the obligations under the
Original Agreement.
1.3 GUARANTOR. Each Guarantor shall guaranty the Obligations subject to the
terms and conditions of their respective Guaranties.
1.4 GENERAL. Unless otherwise specified in the Loan Documents: (i)
references in a Loan Document to "Sections," "Exhibits," and "Schedules" are to
sections, exhibits, and schedules in and to such Loan Document, (ii) references
in a Loan Document to any document, instrument, or agreement (a) shall include
all exhibits, schedules, and other attachments thereto, (b) shall include all
documents, instruments, or agreements issued or executed in replacement or
restatement thereof, to the extent permitted hereby, and (c) shall mean such
document, instrument, or agreement, or replacement or predecessor thereto, as
amended, supplemented, restated, or otherwise modified from time to time to the
extent permitted hereby and in effect at any given time, (iii) wherever from the
context it appears appropriate, each term stated in either the singular or
plural shall include the singular and plural, and pronouns stated in the
masculine, feminine, or neuter gender shall include the masculine, the feminine,
and the neuter, (iv) unless explicitly set forth to the contrary, a reference to
a "Subsidiary" means a Subsidiary of the Borrower or a Subsidiary of such
Subsidiary, and a reference to an "Affiliate" means a reference to an Affiliate
of the Borrower, (v) titles and captions of Sections, subsections, and clauses
in any Loan Document are for convenience only, and neither limit nor amplify the
provisions of such Loan Document, (vi) unless otherwise indicated, all
references to time are references to Boston, Massachusetts, time, (vii) all
references to money (including the symbol "$") are to lawful currency of the
United States, (viii) references to "including" mean including without limiting
the generality of any description preceding that word, (ix) the rule of
construction providing that references to general items following references to
specific items are limited to the same type or character of those specific items
is not applicable in the Loan Documents, (x) references to any Person include
that Person's heirs, personal representatives, successors, trustees, receivers,
and permitted assigns, (xi) references to any Legal Requirement include every
amendment or supplement to it, rule and regulation adopted under it, and
successor or replacement for it, and (xii) references to dollars (including the
symbol "$") shall mean lawful money of the United States.
1.5 ACCOUNTING PRINCIPLES. All accounting and financial terms used in the
Loan Documents and the compliance with each financial covenant therein shall be
determined in accordance with GAAP, and all accounting principles shall be
applied on a consistent basis so that the accounting principles in a current
period are comparable in all material respects to those applied during the
preceding comparable period. The Borrower shall notify the Agent of any change
1
in GAAP from that in effect on the date hereof which would in any way effect the
operation of any covenant in any Loan Documents (including covenants which
relate to Persons other than the Borrower, such as the Guarantors) whereupon,
the Agent and the Borrower shall attempt for a reasonable period (not to exceed
ten (10) Business Days unless the Agent and the Borrower agree to extend such
time period) to agree upon appropriate amendments to the affected covenants to
eliminate such effect and to produce equivalent results, failing which, for
purposes of calculating such financial covenants, GAAP will mean generally
accepted accounting principles on the date just prior to the date on which any
such change in GAAP became effective.
2. LOAN PROVISIONS.
---------------
2.1 THE FACILITY.
------------
2.1.1 Subject to the terms and conditions of this Agreement, the
Lenders agree to make Warehousing Advances to the Borrower from the Closing Date
to the Maturity Date (or, in the event that the Maturity Date is not a business
day, to the business day immediately preceding the Maturity Date), during which
period the Borrower may borrow, repay and reborrow in accordance with the
provisions of this Agreement. The aggregate amount of all Warehousing Advances
outstanding from time to time hereunder may hereinafter collectively be referred
to as the "Loan." The aggregate principal amount of the Loan outstanding at any
one time may not exceed the Warehousing Commitment Amount. While a Default
exists, the Lenders may refuse to make any additional Warehousing Advances to
the Borrower. All Warehousing Advances under this Agreement constitute a single
indebtedness, and all of the Collateral is security for the Notes and for the
performance of all of the Obligations.
2.1.2 MAXIMUM AMOUNT OF FACILITY; INCREASE IN TOTAL COMMITMENT.
Subject to the applicable terms and conditions of this Agreement, including
terms and conditions of this Section 2.1.2, the maximum principal amount
outstanding under the Facility shall not exceed $100,000,000.
(i) So long as the Incremental Loan Commitment Requirements are
satisfied at the time of the delivery of the request referred to below, the
Borrower shall have the right at any time and from time to time, upon at
least ten (10) Business Days' prior written notice to the Agent, to
increase the amount of the Total Commitment to an amount in no event to
exceed $125,000,000, either by new Lenders establishing Commitments, or by
one or more of the then existing Lenders increasing their Commitments (each
such increase by either means, a "Commitment Increase," and each such new
Lender, or Lender increasing its Commitment, an "Additional Commitment
Lender"), PROVIDED, HOWEVER, that (a) if the Borrower desires to accomplish
such increase in whole or in part through an increase in the Commitment of
one or more then existing Lenders, the Agent shall manage the process in
coordination with the Borrower, (b) no Lender shall under any circumstance
be obligated to provide a Commitment Increase as a result of any such
request by the Borrower, (c) any new Lender must qualify as an Eligible
Assignee and shall be subject to the approval of the Agent, which approval
shall not unreasonably be withheld, (d) the terms of any Commitment
Increase shall be on the same terms and conditions as the Commitments of
all other Lenders, and (e) without the consent of the Agent and all of the
Lenders, at no time shall there be more than three (3) Lenders hereunder.
No Commitment Increase shall become effective unless and until the
Borrower, the Agent, and the Additional Commitment Lender shall have
executed and delivered an agreement substantially in the form of EXHIBIT H
hereto (a "Commitment Increase Supplement"). Each Commitment Increase shall
be in a minimum aggregate amount of at least $10,000,000 and in integral
multiples of $1,000,000 in excess thereof.
(ii) In connection with any Commitment Increase to be provided
hereunder, the Incremental Loan Commitment Requirements and any other
conditions precedent agreed to by the Borrower that may be set forth in the
applicable Commitment Increase Supplement shall have been satisfied
(including, without limitation, the payment of any fees by the Borrower
required in connection therewith, including, without limitation, any agreed
upon up-front or arrangement fees owing to the Agent), and the Borrower
shall deliver to the Agent an opinion or opinions, in form and substance
reasonably satisfactory to the Agent, from counsel to the Borrower
reasonably satisfactory to the Agent (it being agreed that the counsel that
delivered the legal opinions on the Closing Date shall be satisfactory to
the Agent) and dated such date, covering such of the matters set forth in
the opinions of counsel delivered to the Agent on the Closing Date as may
2
be reasonably requested by the Agent, and such other matters as the Agent
reasonably may request. The Agent shall promptly notify each Lender as to
the effectiveness of each Commitment Increase (with each date of such
effectiveness being referred to herein as a "Commitment Increase Date"),
and at such time (x) the Warehousing Commitment Amount under, and for all
purposes of, this Agreement shall be increased by the aggregate amount of
such Commitment Increases, (y) SCHEDULE 1 shall be deemed modified to
reflect the revised Commitments of the affected Lenders, and (z) to the
extent requested by any Additional Commitment Lender, Notes will be issued
at the Borrower' s expense to such Additional Commitment Lender, to be in
conformity with requirements of Section 2.4 (with appropriate modification)
to the extent necessary to reflect the new Commitment of such Additional
Commitment Lender.
(iii) In connection with any provision of Commitment Increases
hereunder, the Lenders and the Borrower agree that, notwithstanding
anything to the contrary in this Agreement, the Borrower shall, in
coordination with the Agent: (x) repay portions of outstanding Warehousing
Advances of certain Lenders, and obtain new or further Warehousing Advances
from certain other Lenders (including the Additional Commitment Lenders),
or (y) take such other actions as reasonably may be required by the Agent
(including by requiring new Warehousing Advances to be obtained and added
to then outstanding Warehousing Advances), in each case to the extent
necessary so that all of the Lenders effectively participate in each
outstanding Warehousing Advance pro rata on the basis of their Commitment
Percentages (determined after giving effect to any increase in the Total
Commitment pursuant to this Section 2.1.2).
2.1.3 LIMITATIONS ON ADVANCES. In addition to the limitations set
forth on EXHIBIT D or elsewhere in this Agreement, each Warehousing Advance to
fund a Multifamily Property shall be limited to the lesser of (x) the Mortgage
Note Amount, or (y) the Committed Purchase Price amount.
2.1.4 OUTSTANDING BALANCE OF THE LOAN. In the event at any time the
outstanding principal balance of the Loan should exceed the lesser of (x) the
Warehousing Commitment Amount or (y) the aggregate Warehousing Collateral Value
of all Eligible Loans against which Warehousing Advances are then outstanding,
the Borrower shall repay such excess amount on demand to the Agent so that the
outstanding principal balance of the Facility is in compliance with the terms
and provisions hereof.
2.2 TERM OF LOAN. The Loan shall mature and become due and payable, and
shall be repaid (together with all accrued and unpaid interest thereon and any
other than outstanding Obligations) by the Borrower in full, on the Maturity
Date.
2.3 WAREHOUSING ADVANCES.
--------------------
2.3.1 To obtain a Warehousing Advance under this Agreement, the
Borrower must deliver to Agent, not later than 1 Business Day before the
Business Day on which the Borrower desires the Warehousing Advance, a completed
and signed request for a Warehousing Advance ("WAREHOUSING ADVANCE REQUEST"), on
the then current form approved by Agent.
2.3.2 Subject to the delivery of a Warehousing Advance Request, and
the satisfaction of the conditions set forth in Sections 5.1 and 5.2, the
Borrower may obtain a Warehousing Advance under this Agreement upon compliance
with the procedures set forth in this Section and in the applicable EXHIBIT B,
including delivery to Agent of all required Collateral Documents. Agent's
current forms of Warehousing Advance Request are set forth in EXHIBIT C. Upon
not less than 3 Business Days' prior Notice to the Borrower, Agent may modify
its form of Warehousing Advance Request and any other Exhibit referred to in
this Section to conform to current Legal Requirements or Agent's or any Lender's
practices and, as so modified, those Exhibits will be deemed a part of this
Agreement.
2.4 INTEREST RATE AND PAYMENT TERMS. All Warehousing Advances made under
the Facility shall be payable as to interest and principal in accordance with
the provisions of this Agreement and the Notes. This Agreement also provides for
interest at a Default Rate, Late Charges and prepayment rights and fees. All
payments for the account of Lenders shall be applied to the respective accounts
of the Lenders in accordance with each Lender's Commitment Percentage. The Agent
will disburse such payments to the Lenders on the date of receipt thereof if
3
received prior to 10:00 a.m. on such date and, if not, on the next Business Day.
Any and all interest rate selection and conversion provisions in this Agreement
are to be administered by the Agent and to be allocated on a pro rata basis to
the Note held by each Lender based upon such Lender's Commitment Percentage.
2.4.1 INTEREST RATE. Principal amounts outstanding under the Loan
shall bear interest at the following rates, at the respective Borrower's
selection, subject to the conditions and limitations provided for in this
Agreement: (i) Variable Rate or (ii) Fixed Rate.
2.4.2 SELECTION TO BE MADE. The Borrower, when requesting a
Warehousing Advance shall select, and thereafter may change the selection of,
the applicable interest rate, from the alternatives otherwise provided for in
this Agreement, by giving Agent a Notice of Rate Selection: (i) at the time of
the request for such Warehousing Advance, (ii) at least two (2) Business Days
prior to the Federal Funds Rate Adjustment Date for any outstanding Fixed Rate
Advances, or (iii) on any Business Day on which the Borrower desires to convert
an outstanding Fixed Rate Advance to a Variable Rate Advance.
2.4.3 NOTICE. The Borrower shall give to the Agent a "Notice of Rate
Selection" from time to time which shall be a written notice, given by
telecopier (with authorized signature), or by telephone if immediately confirmed
by such a written notice, from an Authorized Representative of the Borrower
which: (i) shall be irrevocable; (ii) is received by Agent not later than 10:00
o'clock A.M.: (a) if a Fixed Rate is selected, at least two (2) Business Days
prior to the Federal Funds Rate Adjustment Date, (b) if a Variable Rate is
selected, on the day on which such rate is first to apply; and (iii) as to each
selected interest rate option, sets forth the aggregate principal amount(s) to
which such interest rate option(s) shall apply.
2.4.4 IF NO NOTICE. If the Borrower fails to select an interest rate
option in accordance with the foregoing prior to a Warehousing Advance, any new
Warehousing Advance made shall be deemed to be a Fixed Rate Advance.
2.4.5 TELEPHONIC NOTICE. Without in any way limiting the Borrower's
obligation to confirm in writing any telephonic notice, Agent may act without
liability upon the basis of telephonic notice believed by Agent in good faith to
be from the Borrower prior to receipt of written confirmation. In each case the
Borrower hereby waives the right to dispute Agent's record of the terms of such
telephonic Notice of Rate Selection.
2.4.6 PAYMENT AND CALCULATION OF INTEREST.
-----------------------------------
(i) All interest shall be: (a) payable in arrears commencing April 1,
2005, and on the same day of each month thereafter until the principal
together with all interest and other obligations payable with respect to
the Loan shall be fully paid; and (b) calculated on the basis of a 360 day
year and the actual number of days elapsed. If any Warehousing Advances
shall constitute Variable Rate Advances, then each change in the Prime Rate
shall simultaneously change the Variable Rate payable under this Agreement.
If any Warehousing Advances shall constitute Fixed Rate Advances, then each
change in the Federal Funds Base Rate shall change the Fixed Rate payable
under this Agreement on the Federal Funds Rate Adjustment Date. Changes in
the rate of interest resulting from the changes in the Prime Rate or the
Federal Funds Base Rate shall take place immediately without prior notice
or demand of any kind.
(ii) If, for any reason, (1) the Borrower repays a Warehousing Advance
on the same day that it was made by the Lenders or (2) the Borrower
instructs Agent not to make a previously requested Warehousing Advance
after the Lenders have reserved funds or made other arrangements necessary
to enable such Lenders to fund that Warehousing Advance, Borrower agrees to
pay to each Lender an administrative fee equal to 1 day of interest on that
Warehousing Advance at a rate of 1 1/2% per annum. Administrative fees are
due and payable in the same manner as interest is due and payable under
this Agreement.
2.4.7 PRINCIPAL. The outstanding principal balance of the Loan shall
be repaid as follows:
4
(i) Each Warehousing Advance (or any portion thereof, if such
Warehousing Advance was used to fund multiple Eligible Loans) shall be
repaid upon the earlier to occur of (x) the payment of the Committed
Purchase Price from an Investor with respect to any Eligible Loan or (y)
that date which is ninety (90) days from the date of the funding of such
Warehousing Advance.
(ii) Upon telephonic Notice to the Borrower by Agent, the Borrower
must pay to Agent, and the Borrower hereby authorizes Agent to charge the
Borrower's Operating Account maintained with the Agent for, the amount of
any outstanding Warehousing Advance against a specific Pledged Asset upon
the earliest occurrence of any of the following events:
(a) On the date a Warehousing Advance was made if the Pledged
Loan that was to have been funded by that Warehousing Advance is not
closed and funded.
(b) Three (3) Business Days elapses from the date a Warehousing
Advance was made against a Pledged Loan, without receipt of the
Collateral Documents relating to that Pledged Loan required to be
delivered on that date, or such Collateral Documents, upon examination
by Agent, are found not to be in compliance with the requirements of
this Agreement or the related Purchase Commitment.
(c) Ten (10) Business Days elapse without the return of a
Collateral Document delivered by Agent to the Borrower under a Trust
Receipt for correction or completion.
(d) On the date on which a Pledged Loan is determined to have
been originated based on untrue, incomplete or inaccurate information
or otherwise to be subject to fraud, whether or not the Borrower had
knowledge of the misrepresentation, incomplete or incorrect
information or fraud, or on the date on which the Borrower knows, or
has reason to know, or receives Notice from the Agent, that one or
more of the representations and warranties set forth in Article 8 were
inaccurate or incomplete in any material respect on any date when made
or deemed made.
(e) On the date the Pledged Loan or a Lien prior to the Pledged
Loan is defaulted and remains in default for a period of 60 days or
more.
(f) On the mandatory delivery date of the related Purchase
Commitment if the specific Pledged Loan has not been delivered under
the Purchase Commitment prior to such mandatory delivery date, or on
the date the related Purchase Commitment expires or is terminated.
(g) Three (3) Business Days after the date a Pledged Loan is
rejected for purchase by an Investor unless another Purchase
Commitment is provided within that 3 Business Day period.
(h) Upon the sale, other disposition or prepayment of any Pledged
Asset or, with respect to a Pledged Loan included in an Eligible
Mortgage Pool, upon the sale or other disposition of the related
Agency Security.
(iii) In addition to the payments required pursuant to Sections 2.4.7
(ii), if the principal amount of any Pledged Loan is prepaid in whole or in
part while a Warehousing Advance is outstanding against the Pledged Loan,
the Borrower must pay to Agent, without the necessity of prior demand or
Notice from Agent, the amount of the prepayment, to be applied against the
Warehousing Advance.
(iv) The proceeds of the sale or other disposition of Pledged Assets
must be paid directly by the Investor to the Cash Collateral Account. The
Borrower must give Notice to Agent (by telephone or electronic mail, and if
by telephone, followed promptly by written notice) of the Pledged Assets
for which proceeds have been received. Upon receipt of such Notice from the
Borrower, Agent will apply any proceeds deposited into the Cash Collateral
Account to the payment of the Warehousing Advance related to the Pledged
Assets identified by the Borrower in its Notice, and those Pledged Assets
5
will be considered to have been redeemed from pledge. Agent is entitled to
rely upon the Borrower's affirmation that deposits in the Cash Collateral
Account represent payments from Investors for the purchase of the Pledged
Assets specified by the Borrower in its Notice. If the payment from an
Investor for the purchase of Pledged Assets is less than the outstanding
Warehousing Advance against the Pledged Assets identified by the Borrower
in its Notice (the "Deficiency"), the Borrower shall immediately deposit
into the Cash Collateral Account the amount of such Deficiency in collected
funds, and the Borrower authorizes Agent to charge the Borrower's Cash
Collateral Account for the amount deposited by the Borrower to cover such
Deficiency to be applied against such Warehousing Advance. As long as no
Default exists, Agent will transfer into the Borrower's Operating Account
any excess payment from an Investor for Pledged Assets.
(v) Agent reserves the right to revalue any Pledged Loan that is not
covered by a Purchase Commitment from ▇▇▇▇▇▇ ▇▇▇ or ▇▇▇▇▇▇▇ Mac. Agent
reserves the right to revalue any Pledged Loan that is to be exchanged for
an Agency Security if that Agency Security is not covered by a Purchase
Commitment. The Borrower must pay to Agent, without the necessity of prior
demand or Notice from Agent, any amount required after any such revaluation
to reduce the principal amount of the Warehousing Advance outstanding
against the revalued Pledged Loan to an amount equal to the Advance Rate
for the applicable Eligible Loan type multiplied by the Fair Market Value
of the respective Mortgage Loan.
(vi) As provided for in Section 2.4.9.
2.4.8 PREPAYMENT. The Loan or any portion thereof may be prepaid in
full or in part, without premium or penalty, at any time by 2:00 p.m. on the
date of such payment.
2.4.9 MATURITY. Upon acceleration of the Loan, if the Loan has been
accelerated by the Agent (or the Facility has been automatically terminated)
upon an Event of Default, or at the Maturity Date, all accrued and unpaid
interest, principal and other Obligations due with respect to the Loan shall be
due and payable in full, and the principal balance and such other Obligations,
but not unpaid interest, shall continue to bear interest at the Default Rate
until so paid.
2.4.10 METHOD OF PAYMENT; DATE OF CREDIT. All payments of interest,
principal and fees shall be made in lawful money of the United States in
immediately available funds, without counterclaim or setoff and free and clear
of, and without any deduction or withholding for, any taxes or other payments:
(a) by direct charge to the Cash Collateral Account of the Borrower, with
respect to interest, or (b) by wire transfer to Agent. Payments shall be
credited on the Business Day on which immediately available funds are received
prior to 2:00 P.M.; payments received after 2:00 P.M. shall be credited to the
Loan on the next Business Day. Payments which are by check, which Agent may at
its option accept or reject, or which are not in the form of immediately
available funds, shall not be credited to the Loan until such funds become
immediately available to Agent, and, with respect to payments by check, such
credit shall be provisional until the item is finally paid by the payor bank.
All payments shall be applied first to the payment of all fees, expenses, and
other amounts due to the Lenders (excluding principal and interest), then to
accrued interest, and the balance on account of outstanding principal, provided,
however, that after the occurrence and during the continuation of an Event of
Default, payments will be applied to the Obligations as the Agent determines,
subject to the provisions of section 11.2.4.
2.4.11 ▇▇▇▇▇▇▇▇. Agent may submit monthly ▇▇▇▇▇▇▇▇ reflecting payments
due; however, any changes in the interest rate which occur between the date of
billing and the due date may be reflected in the billing for a subsequent month.
Neither the failure of Agent to submit a billing nor any error in any such
billing shall excuse the Borrower from the obligation to make full payment of
all the Borrower's payment Obligations when due.
2.4.12 DEFAULT RATE. Agent shall have the option of imposing, and the
Borrower shall pay upon billing therefor, an interest rate which is four percent
(4%) per annum above the Variable Rate ("Default Rate"): following any Event of
Default (including, without limitation, following the Maturity Date), unless and
until the Event of Default is waived by Agent or cured, and the Borrower's right
to select pricing options shall cease.
2.4.13 LATE CHARGES. The Borrower shall pay, upon billing therefor, a
"Late Charge" equal to five percent (5%) of the amount of any payment of
principal, other than principal due at the Maturity Date (or the date on which
the Agent accelerates the time for payment of the Loan after the occurrence of
an Event of Default), interest, or other Obligations, which are not paid within
6
ten (10) days of the due date thereof. Late Charges are: (a) payable in addition
to, and not in limitation of, the Default Rate, (b) intended to compensate Agent
and the Lenders for administrative and processing costs incident to late
payments, (c) not interest, and (d) not subject to refund or rebate or credit
against any other amount due.
2.4.14 OVERDRAFT ADVANCES. Notwithstanding any other provision of this
Agreement, if, pursuant to this Agreement, the Agent debits the Borrower's
Operating Account to honor an item presented against the Operating Account and
that debit or direction results in an overdraft, the Agent may, but in no event
shall be obligated to, make an additional Warehousing Advance to fund that
overdraft (an "Overdraft Advance"). The Borrower shall pay the outstanding
amount of any Overdraft Advance within one (1) Business Day after the date of
the Overdraft Advance.
2.5 LOAN FEES.
---------
2.5.1 LOAN FEES. The Borrower shall pay a commitment fee for the
period commencing on December 22, 2004 and ending on February 28, 2006, as
agreed to among the Borrower and the Agent in accordance with the provisions of
the Fee Letter.
2.5.2 FACILITY FEE. The Borrower agrees to pay a facility fee to Agent
on behalf of the Lenders on the average daily unborrowed portion of the Facility
from the Agreement Date to the Maturity Date (the "Facility Fee"), calculated as
set forth below. The Facility Fee shall be payable in arrears on the first
Business Day of each calendar quarter for the immediately preceding calendar
quarter or portion thereof and on the Maturity Date, and shall be calculated by
multiplying the average daily unborrowed portion of the Facility for such
immediately preceding calendar quarter or portion thereof by 0.025% percent, and
multiplying that product by a fraction, the numerator of which is the number of
days during such calendar quarter that the Facility remained outstanding, and
the denominator of which is ninety (90) days. The Borrower shall not be entitled
to any credit, rebate or repayment of the Facility Fee notwithstanding any
termination of this Agreement or suspension or termination of the Agent's and
any Lender's respective obligation to make Warehousing Advances hereunder.
2.6 ACCELERATION. The Agent may, and upon the request of the Requisite
Lenders shall, terminate the Commitments, and accelerate the Loan, following an
Event of Default, provided, however, upon the occurrence of any Event of Default
described in Sections 9.1.6 or 9.1.7, the Commitments shall automatically
terminate and all such amounts shall become immediately due and payable
automatically and without any requirement of notice from any of the Lenders or
the Agent. Upon such an acceleration, all principal, accrued interest and costs,
fees, and expenses shall be due and payable together with interest on such
principal at the Default Rate and any applicable make whole provisions.
3. SECURITY FOR THE FACILITY.
-------------------------
3.1 GRANT OF SECURITY INTEREST. As security for the Facility and the
payment of the Loan and for the performance of all of the Borrower's other
Obligations, the Borrower grants a security interest to Agent, for the ratable
benefit of the Lenders, in all of the Borrower's right, title and interest in
and to the following described property ("Collateral"):
3.1.1 All amounts advanced by Lenders to or for the account of the
Borrower under this Agreement to fund a Mortgage Loan until that Mortgage Loan
is closed and those funds disbursed.
3.1.2 All Mortgage Loans, including all Mortgage Notes and Mortgages
evidencing or securing those Mortgage Loans, that are delivered or caused to be
delivered to Agent for the benefit of the Lenders (including delivery to a third
party on behalf of Agent), or that otherwise come into the possession, custody
or control of Agent for the purpose of pledge or in respect of which Lenders
have made a Warehousing Advance under this Agreement (collectively, "PLEDGED
LOANS").
3.1.3 All Mortgage-backed Securities that are created in whole or in
part on the basis of Pledged Loans or are delivered or caused to be delivered to
Agent for the benefit of the Lenders, or are otherwise in the possession of
7
Agent, or its agent, bailee or custodian as assignee, or pledged to Agent for
the benefit of the Lenders, or for such purpose are registered by book-entry in
the name of Agent (including delivery to or registration in the name of a third
party on behalf of Agent) under this Agreement or in respect of which a
Warehousing Advance has been made by Lenders under this Agreement (collectively,
"PLEDGED SECURITIES").
3.1.4 All commitments issued by FHA to insure or guarantee any
Mortgage Loans included in the Pledged Loans; all Purchase Commitments held by
the Borrower covering Pledged Assets or proposed permanent Pledged Loans, and
all proceeds from the sale of Pledged Assets to Investors pursuant to those
Purchase Commitments; and all personal property, contract rights, servicing and
servicing fees and income or other proceeds, amounts and payments payable to the
Borrower whether as compensation or reimbursement, accounts or general
intangibles of whatsoever kind relating to Pledged Assets, FHA Commitments and
the Purchase Commitments, and all other documents or instruments relating to
Pledged Assets, including any interest of the Borrower in any fire, casualty or
hazard insurance policies and any awards made by any public body or decreed by
any court of competent jurisdiction for a taking or for degradation of value in
any eminent domain proceeding as the same relate to Pledged Loans.
3.1.5 All escrow accounts, documents, instruments, files, surveys,
certificates, correspondence, appraisals, computer programs, tapes, discs,
cards, accounting records (including all information, records, tapes, data,
programs, discs and cards necessary or helpful in the administration or
servicing of the Collateral) and other information and data of the Borrower
relating to the Collateral.
3.1.6 All cash, whether now existing or acquired after the date of
this Agreement, delivered to or otherwise in the possession of Agent or any
Lender, or their respective agents, bailees or custodians (provided, that with
respect to funds held by the Borrower in trust or escrow for any other Person
with the Agent or any Lender, only the Borrower's interest in earnings on such
funds shall be Collateral) or designated on the books and records of the
Borrower as assigned and pledged to Agent for the benefit of the Lenders,
including all cash deposited in the Cash Collateral Account.
3.1.7 All Accounts or General intangibles owned by the Borrower
("RECEIVABLES") related to the Collateral referenced in Sections 3.1.1 through
and including 3.1.3 for the payment of money against (1) FHA or a private
mortgage insurer under an FHA or private insurer's mortgage insurance policy
insuring payment of, or any other Person under any other agreement (excluding a
Servicing Contract) relating to, all or part of a defaulted Mortgage Loan
repurchased by the Borrower from an investor or out of a pool of Mortgage Loans
serviced by the Borrower, (2) obligors and their accounts, or any Investor,
insurer or guarantor covering, or out of the proceeds of any sale of or
foreclosure sale in respect of, any Mortgage Loan being serviced by any
Borrower, in either case, for the reimbursement of real estate taxes or
assessments, or casualty or liability insurance premiums, paid by the Borrower
in connection with Mortgage Loans and (3) obligors and their accounts, or any
other Investor, insurer or guarantor under or in respect of, or out of the
proceeds of any sale or foreclosure sale in respect of, any Mortgage Loans
serviced by the Borrower for repayment of advances made by the Borrower to cover
shortages in principal and interest payments.
3.1.8 All Hedging Arrangements related to the Collateral referenced in
Section 3.1.1 through and including 3.1.3 ("PLEDGED HEDGING ARRANGEMENTS") and
the Borrower's accounts in which those Hedging Arrangements are held ("PLEDGED
HEDGING ACCOUNTS"), including all rights to payment arising under the Pledged
Hedging Arrangements and the Pledged Hedging Accounts, except that Agent's
security interest in the Pledged Hedging Arrangements and Pledged Hedging
Accounts is limited to benefits, including rights to payment, related to the
Collateral.
3.1.9 All cash and non-cash proceeds of the Collateral, including all
dividends, distributions and other rights in connection with, and all additions
to, modifications of and replacements for, the Collateral, and all products and
proceeds of the Collateral, together with whatever is receivable or received
when the Collateral or proceeds of Collateral are sold, collected, exchanged or
otherwise disposed of, whether such disposition is voluntary or involuntary,
including all rights to payment with respect to any cause of action affecting or
relating to the Collateral or proceeds of Collateral.
8
3.2 AUTHENTICATED RECORD. This Agreement constitutes an authenticated
record which authorizes the Agent to file such financing statements as the Agent
determines as appropriate to perfect or protect the security interests created
by this Agreement.
3.3 RELEASE OF SECURITY INTEREST IN PLEDGED ASSETS
----------------------------------------------
3.3.1 Except as provided in Section 3.3.2, Pledged Loans will be
released from Agent's security interest only against payment to Agent of the
Release Amount in connection with those Pledged Loans. If Pledged Loans are
transferred to a pool custodian or an investor for inclusion in a Mortgage Pool
and Agent's security interest in the Pledged Loans included in the Mortgage Pool
is not released before the issuance of the related Mortgage-backed Security,
then that Mortgage-backed Security, when issued, is a Pledged Security, Agent's
security interest continues in the Pledged Loans backing that Pledged Security
and Agent is entitled to possession of the Pledged Security in the manner
provided in this Agreement.
3.3.2 If Pledged Loans are transferred to an Approved Custodian and
included in an Eligible Mortgage Pool, Agent's security interest in the Pledged
Loans included in the Eligible Mortgage Pool will be released upon the delivery
of the Agency Security to Agent (including delivery to or registration in the
name of a third party on behalf of Agent), and that Agency Security is a Pledged
Security. Agent's security interest in that Pledged Security will be released
only against payment to Agent of the Release Amount in connection with the
Mortgage Loans backing that Pledged Security.
3.3.3 Agent has the exclusive right to possession of all Pledged
Securities or, if Pledged Securities are issued in book-entry form or issued in
certificated form and delivered to a clearing corporation (as such term is
defined in the UCC) or its nominee, Agent has the right to have the Pledged
Securities registered in the name of a securities intermediary (as such term is
defined in the UCC) in an account containing only customer securities and
credited to an account of Agent. Agent has no duty or obligation to deliver
Pledged Securities to an Investor or to credit Pledged Securities to the account
of an Investor or the Investor's designee except against payment for those
Pledged Securities, unless the Agent shall have entered into a master agreement
with such Investor on terms and conditions satisfactory to the Agent. The
Borrower acknowledges that Agent may enter into one or more standing
arrangements with securities intermediaries with respect to Pledged Securities
issued in book entry form or issued in certificated form and delivered to a
clearing corporation or its nominee, under which the Pledged Securities are
registered in the name of the securities intermediary, and the Borrower agrees,
upon request of Agent, to execute and deliver to those securities intermediaries
the Borrower's written concurrence in any such standing arrangements.
3.3.4 If no Default occurs, the Borrower may redeem a Pledged Loan or
Pledged Security from Agent's security interest by notifying Agent of its
intention to redeem the Pledged Loan or Pledged Security from pledge and either
(1) paying, or causing an Investor to pay, to Agent the Release Amount in
connection with the Pledged Loan or the Pledged Loans backing that Pledged
Security, or (2) delivering substitute Collateral that, in addition to being
acceptable to Agent in its sole discretion will, when included with the
remaining Collateral, result in a Warehousing Collateral Value of all Collateral
held by Agent that is at least equal to the aggregate outstanding Loan.
3.3.5 After a Default occurs, Agent may, with no liability to the
Borrower or any Person, continue to release its security interest in any Pledged
Loan or Pledged Asset against payment of the Release Amount in connection with
that Pledged Loan or the Pledged Loans backing that Pledged Security.
3.3.6 The amount ("RELEASE AMOUNT") to be paid by the Borrower to
obtain the release of Agent's security interest in a Pledged Loan will be (1)
until an Event of Default occurs, the principal amount of the Warehousing
Advances outstanding against the Pledged Loan, and (2) while an Event of Default
exists, the full Committed Purchase Price therefor, or amount paid to Agent in a
commercially reasonable disposition of that Pledged Loan by the Agent in the
exercise of its rights and remedies under this Agreement.
9
3.4 COLLECTION AND SERVICING RIGHTS
-------------------------------
3.4.1 If no Event of Default exists, the Borrower may service and
receive and collect directly all sums payable to the Borrower in respect of the
Collateral other than proceeds of any Purchase Commitment or proceeds of the
sale of any Collateral (which shall be paid directly to the Cash Collateral
Account).
3.4.2 After an Event of Default, Agent or its designee are entitled to
service and receive and collect all sums payable to the Borrower in respect of
the Collateral, and in such case (1) Agent or its designee in its discretion
may, in its own name, in the name of the Borrower or otherwise, demand, ▇▇▇ for,
collect or receive any money or property at any time payable or receivable on
account of or in exchange for any of the Collateral, but Agent has no obligation
to do so, (2) the Borrower must, if Agent requests it to do so, hold in trust
for the benefit of Agent and immediately pay to Agent at its office designated
by Notice, all amounts received by the Borrower upon or in respect of any of the
Collateral, advising Agent as to the source of such funds and (3) all amounts so
received and collected by Agent will be held by it as part of the Collateral for
the ratable benefit of the Lenders.
3.5 RETURN OF COLLATERAL AT END OF WAREHOUSING COMMITMENT
-----------------------------------------------------
3.5.1 If (a) the Warehousing Commitment has expired or been
terminated, and (b) no Warehousing Advances, interest or other Obligations are
outstanding and unpaid, Agent will release its security interest and will
deliver all Collateral in its possession to the Borrower at the Borrower's
expense. The Borrower's acknowledgment or receipt for any Collateral released or
delivered to the Borrower under any provision of this Agreement is a complete
and full acquittance for the Collateral so returned, and Agent is discharged
from any liability or responsibility for that Collateral.
3.6 DELIVERY OF COLLATERAL DOCUMENTS
--------------------------------
3.6.1 Agent may deliver documents relating to the Collateral to the
Borrower for correction or completion under a Trust Receipt.
3.6.2 If no Default exists, upon delivery by the Borrower to Agent of
shipping instructions pursuant to the applicable EXHIBIT B, Agent will transmit
Pledged Loans or Pledged Securities, together with all related loan documents
and pool documents in Agent's possession, to the applicable Investor, Approved
Custodian or other party acceptable to Agent in its sole discretion.
3.6.3 If a Default exists, Agent may, without liability to the
Borrower or any other Person, continue to transmit Pledged Loans or Pledged
Securities, together with all related loan documents and pool documents in
Agent's possession, to the applicable Investor, Approved Custodian or other
party acceptable to Agent in its sole discretion.
3.6.4 Upon receipt of Notice from the Borrower under Section
2.4.7(iv), and payment of the Release Amount with respect to a Pledged Loan
identified by the Borrower, Agent will release to the Borrower any Collateral
Documents relating to the redeemed Pledged Loan or the Pledged Loans backing a
Pledged Security that Agent has in its possession and that have not been
delivered to an Investor or Approved Custodian.
3.7 LOAN DOCUMENTS AND SECURITY DOCUMENTS. The Facility and the Loan shall
be made, evidenced, administered, secured and governed by all of the terms,
conditions and provisions of the "Loan Documents", each as the same may be
hereafter modified or amended, consisting of: (i) this Agreement; (ii) the Notes
made payable by the Borrower in favor of each Lender; (iii) the Guaranties; (iv)
the Assigned Collateral Documents; (v) any other documents, instruments, or
agreements executed to further evidence or secure the Loan or any other
Obligations; and (vi) any Hedging Arrangements as to which the Agent (or an
Affiliate of the Agent) is a counterparty.
Each of the Loan Documents listed in items (i) through (iii),
inclusive, shall be dated as of the date of the Original Agreement or as of the
date hereof. The Assigned Collateral Documents are sometimes collectively
referred to herein as the "Security Documents".
10
4. CONTINUING AUTHORITY OF AUTHORIZED REPRESENTATIVES. Agent and each of the
Lenders are authorized to rely upon the continuing authority of the Persons
hereafter designated by the Borrower ("Authorized Representatives") to bind the
Borrower with respect to all matters pertaining to the Loan and the Loan
Documents including, but not limited to, the selection of interest rates, the
submission of requests for Warehousing Advances, and certificates with regard
thereto. Such authorization may be changed only upon written notice to Agent
accompanied by evidence, reasonably satisfactory to Agent, of the authority of
the person giving such notice and such notice shall be effective not sooner than
five (5) Business Days following receipt thereof by Agent. The Authorized
Representatives as of the date of this Agreement are listed on SCHEDULE 4. The
Agent shall have a right of approval, not to be unreasonably withheld or
delayed, over the identity of the Authorized Representatives so as to assure
Agent and each of the Lenders that each Authorized Representative is a
responsible and senior official of the Borrower.
5. CONDITIONS PRECEDENT
--------------------
5.1 ESTABLISHMENT OF FACILITY AND FUNDING INITIAL WAREHOUSING ADVANCE. It
shall be a condition precedent of Lenders' obligation to continue the Facility
that each of the following conditions precedent be satisfied in full (as
determined by the Agent and the Requisite Lenders in their discretion which
discretion shall be exercised in good faith), unless specifically waived in
writing by the Agent and the Requisite Lenders at or prior to closing:
5.1.1 SATISFACTORY LOAN DOCUMENTS. Each of the Loan Documents shall
have been duly executed and delivered by the respective parties thereto and,
shall be in full force and effect and shall be in form and substance
satisfactory to each of the Lenders.
5.1.2 NO MATERIAL CHANGE. No material adverse change shall have
occurred in the financial condition, business, affairs or operations of the
Borrower or either of the Guarantors since the date of their respective
financial statements most recently delivered to the Agent (September 30, 2004).
5.1.3 UCC AND TAX LIEN SEARCHES. UCC, tax lien and judgment searches
of the appropriate public records for the Borrower that do not disclose the
existence of any prior Lien on the Collateral other than in favor of Agent or as
permitted under this Agreement, or other than a Lien in favor of any Person
which Lien shall be terminated in accordance with the provisions of this
Agreement.
5.1.4 WARRANTIES AND REPRESENTATIONS ACCURATE. All warranties and
representations made by or on behalf of the Borrower and the Guarantors to Agent
or any of the Lenders pursuant to the Loan Documents shall be true and accurate
in all material respects and shall not omit any material fact necessary to make
the same not misleading.
5.1.5 FINANCIALS. Agent and each of the Lenders shall have received
and approved financial statements from the Borrower complying with the standards
set forth in Section 7.5.
5.1.6 VALIDITY AND SUFFICIENCY OF SECURITY DOCUMENTS. UCC financing
statements naming the Borrower as debtor and the Agent as secured party covering
the Collateral shall have been duly recorded and filed to the satisfaction of
Agent and its counsel.
5.1.7 NO OTHER LIENS. The Collateral shall not be subject to any Liens
or encumbrances, whether inferior or superior to the Loan Documents or the other
Security Documents, except for a Lien in favor of any Person which shall be
terminated in accordance with the provisions of this Agreement.
5.1.8 ORGANIZATIONAL DOCUMENTS AND ENTITY AGREEMENTS. The Agent shall
have received from the Borrower and each Guarantor a copy, certified as of a
recent date by the appropriate officer of the State in which such Person is
organized to be true and complete, of the corporate charter and any other
organization documents of such Person as in effect on such date of
certification. The Borrower and the Guarantors shall furnish evidence
satisfactory to the Agent that they are each duly qualified and in good standing
in each jurisdiction in which it owns or leases property or in which the conduct
of its business requires it to so qualify, except where the failure to so
11
qualify could not have a materially adverse effect on the business, assets, or
financial condition of the Borrower or the Guarantors.
5.1.9 VOTES, CONSENTS AND AUTHORIZATIONS. All action on the part of
the Borrower and Guarantors necessary for the valid execution, delivery and
performance by (x) the Borrower of this Agreement and the other Loan Documents
to which it is or is to become a party, and (y) the Guarantors of the Loan
Documents to which they are or are to become a party, shall have been duly and
effectively taken, and evidence thereof satisfactory to the Agent shall have
been provided to the Agent. The Agent shall have received from the Borrower and
Charter Mac Corporation true copies of their respective by-laws and the
resolutions adopted by the their respective boards of directors authorizing the
transactions described herein, each certified by each of their secretaries as of
a recent date to be true and complete, and the Agent shall have received from
CharterMac true copies of its Declaration of Trust and the resolutions adopted
by its Board of Trustees authorizing the transactions described herein, each
certified by its Manager as of a recent date to be true and complete.
5.1.10 INCUMBENCY CERTIFICATE; AUTHORIZED SIGNERS. The Agent shall
have received from the Borrower an incumbency certificate, dated as of the
Closing Date, signed by a duly authorized officer of the Borrower and the
Guarantors and giving the name and bearing a specimen signature of each
individual who shall be an Authorized Representative: (a) to sign, in the name
and on behalf of such Person, each of the Loan Documents to which such Person is
or is to become a party; (b) with respect to the Borrower, to make requests for
Warehouse Advances; and (c) to give notices and to take other action on behalf
of the Borrower under the Loan Documents.
5.1.11 CORPORATE STRUCTURE. The Agent shall be satisfied in all
respects with the legal structure and capitalization of the Borrower and the
Guarantors and all documentation relating thereto.
5.1.12 LITIGATION. There shall be no pending or threatened litigation
involving the Borrower or either of the Guarantors which, in the judgment of the
Agent, could have a material adverse effect on such Person or the ability of the
Borrower or the Guarantors to perform their obligations under the Loan Documents
to which they are a party, and no judgment, order, injunction or other similar
injunction or other similar restraint prohibiting any of the transactions
contemplated hereby shall exist.
5.1.13 EVIDENCE OF INSURANCE. The Agent shall have received evidence,
in form, scope and substance and with such insurance carriers, satisfactory to
the Agent, for all insurance policies required under any of the Loan Documents.
5.1.14 FINANCIAL STATEMENTS. The Lenders shall have received such
financial statements and other information and projections as the Agent shall
have reasonably requested, and the information shall be satisfactory to the
Lenders.
5.1.15 EXAMINATION OF BOOKS AND ASSETS. The Agent shall have been
afforded the opportunity prior to closing, to review the books, records, leases,
contracts, pension plans, workers' compensation and retiree health plans, ERISA
matters, product liability litigation, insurance coverage and properties of the
Borrower, and to perform such other due diligence regarding the Borrower as the
Agent shall have required, the results of which review and due diligence shall
have been reasonably satisfactory to the Agent and its counsel.
5.1.16 COMPLIANCE WITH LAW. The Agent shall be satisfied that (i) the
Borrower and the Guarantors have obtained all material and appropriate
authorizations and approvals of all governmental authorities (including, without
limitation, any approvals required by any of ▇▇▇▇▇▇ ▇▇▇, FHA, ▇▇▇▇▇▇▇ Mac,
▇▇▇▇▇▇ ▇▇▇, HUD), required for the due execution, delivery and performance by
the Borrower and the Guarantors of each of the Loan Documents to which they are
or will be a party and for the perfection of or the exercise by the Agent and
each Lender of their respective rights and remedies under the Loan Documents,
and (ii) the Facility as well as all other transactions contemplated hereby,
shall be in material compliance with, and the Borrower and the Guarantors shall
have obtained all material and appropriate approvals pertaining to, all
applicable laws, rules, regulations and orders, including, without limitation,
all governmental, environmental, ERISA retiree health benefits, workers'
compensation and other requirements, regulations and laws and shall not
contravene any charter, by-law, debt instrument or other material Contractual
Obligation of the Borrower and Guarantors and their respective Subsidiaries.
12
5.1.17 LEGAL AND OTHER OPINIONS. Each of the Lenders and the Agent
shall have received an opinion addressed to the Lenders and the Agent and dated
as of the Closing Date, in form and substance satisfactory to the Lenders and
the Agent from the Borrower's and Guarantors' counsel, Proskauer Rose LLP.
5.1.18 ELIGIBILITY CERTIFICATES. Copies of the certificates, documents
or other written instruments that evidence the Borrower's eligibility described
in Section 8.1, together with copies of all seller/servicer contracts to which
the Borrower is a party, all in form and substance satisfactory to Agent.
5.1.19 PAYMENT OF FEES. The Borrower shall have paid to the Agent all
fees and expenses required pursuant to this Agreement, the Fee Letter and the
other Loan Documents.
5.1.20 NO DEFAULT. There shall not be any Default under any of the
Loan Documents.
5.1.21 EVIDENCE OF INSURANCE. Copies of the policies, or certificates
in lieu of policies, evidencing the Borrower's compliance with the insurance
requirements of Section 7.7.
5.1.22 ADDITIONAL DOCUMENTS. The Borrower shall have provided such
additional instruments and documents to the Agent and the Lenders as the Agent
and the Agent's counsel may have reasonably requested.
5.2 WAREHOUSING ADVANCES. Each Warehousing Advance shall be subject to the
condition precedent that all conditions to closing the Facility were satisfied
or waived on the Closing Date and to the further satisfaction of each of the
following conditions precedent, unless specifically waived in writing by Agent
(with the consent of the Requisite Lenders or all of the Lenders, as may be
applicable) at or prior to the time of each such Warehousing Advance:
5.2.1 REPRESENTATIONS TRUE; NO EVENT OF DEFAULT. Each of the
representations and warranties and covenants of the Borrower and the Guarantors
contained in this Agreement or the other Loan Documents shall be true as of the
date as of which they were made and shall also be true at and as of the time of
the making of such Warehousing Advance, with the same effect as if made at and
as of that time (except to the extent of changes resulting from transactions
contemplated and permitted by this Agreement and the other Loan Documents and
changes occurring in the ordinary course of business that singly or in the
aggregate are not materially adverse, and except to the extent that such
representations and warranties relate expressly to an earlier date) and no
Default shall have occurred and be continuing. Each of the Lenders shall have
received a certificate of the Borrower signed by an authorized officer of the
Borrower to such effect.
5.2.2 WAREHOUSING ADVANCE REQUEST. The Borrower must have delivered to
Agent the Warehousing Advance Request and Collateral Documents called for under,
and must have satisfied the procedures set forth in, Section 2 and the
applicable Exhibits described in such Section 2. All items delivered to Agent
must be satisfactory to Agent in form and content, and Agent may reject any item
that does not satisfy the requirements of this Agreement or of the related
Purchase Commitment.
5.2.3 NO LEGAL IMPEDIMENT. No change shall have occurred in any law or
regulations thereunder or interpretations thereof that in the reasonable opinion
of any Lender would make it illegal for such Lender to make such Warehousing
Advance.
5.2.4 GOVERNMENTAL REGULATION. Each Lender shall have received such
statements in substance and form reasonably satisfactory to such Lender as such
Lender shall require for the purpose of compliance with any applicable
regulations of the Comptroller of the Currency or the Board of Governors of the
Federal Reserve System.
5.2.5 PROCEEDINGS AND DOCUMENTS. All proceedings in connection with
the transactions contemplated by this Agreement, the other Loan Documents and
all other documents incident thereto shall be reasonably satisfactory in
substance and in form to the Lenders and to the Agent's counsel, and the Lenders
and such counsel shall have received all information and such counterpart
originals or certified or other copies of such documents as the Agent may
reasonably request.
13
5.2.6 NO ADVERSE CHANGES. There shall not have been any material
adverse change in the financial condition, business, affairs of the Borrower or
the Guarantors since the date of this Agreement which in Agent's good faith
judgment may jeopardize in a material manner the ability of the Borrower or
Guarantors to perform fully their respective obligations under each applicable
Loan Document.
5.2.7 OTHER CERTIFICATES. Agent shall have received and approved such
other documents and certificates as Agent may reasonably request, in form and
substance reasonably satisfactory to Agent.
6. WARRANTIES AND REPRESENTATIONS. The Borrower warrants and represents to
Agent and each of the Lenders for the express purpose of inducing Lenders to
enter into this Agreement, to make each Warehousing Advance, and to otherwise
complete all of the transactions contemplated hereby, that, as of the date of
this Agreement and upon the date of each Warehousing Advance as follows:
6.1 FINANCIAL INFORMATION. True and complete copies of financial statements
of the Borrower and the Guarantors have been delivered to Agent and each of the
Lenders and the same fairly present the financial condition of such Person as of
the date thereof and no material and adverse change has occurred in such
financial condition since the date thereof. All financial statements of such
Persons hereafter furnished to Agent or any of the Lenders shall be true and
complete copies thereof and shall fairly present the financial condition of such
Person as of the date thereof.
6.2 NO VIOLATIONS. The establishment of the Facility, the obtaining of the
Warehousing Advances, and the subsequent payment and performance of the
Obligations evidenced and secured by the Loan Documents shall not constitute a
violation of, or conflict with, any other Legal Requirement, Contractual
Obligation or organizational document to which the Borrower and/or Guarantors
are a party or by which any such entity or its property is or may be bound.
6.3 NO LITIGATION. Except as set forth on SCHEDULE 6.3, there are no
actions, suits, proceedings or investigations of any kind pending or, to the
knowledge of the Borrower, threatened against the Borrower, the Guarantors, or
any of their respective Subsidiaries or Affiliates before any court, tribunal or
administrative agency or board that, if adversely determined, would reasonably
be expected to, either in any case or in the aggregate, materially adversely
affect the properties, assets, financial condition or business of such Person or
materially impair the right of such Person to carry on business substantially as
now conducted by it, or result in any substantial liability not adequately
covered by insurance, or for which adequate reserves are not maintained on the
balance sheet of such Person (considering the Borrower and its Subsidiaries as a
single Person for purposes of this Section 6.3), or which question the validity
of this Agreement or any of the other Loan Documents, or any action taken or to
be taken pursuant hereto or thereto.
6.4 FRANCHISES, PATENTS, COPYRIGHTS, ETC.. The Borrower and the Guarantors
each possess all franchises, patents, copyrights, trademarks, trade names,
licenses and permits, and rights in respect of the foregoing, adequate for the
conduct of its business substantially as now conducted, without known conflict
with any rights of others.
6.5 GOOD TITLE AND NO LIENS. The Borrower and each of the Guarantors,
respectively, are the lawful owner of their respective Collateral and are and
will be the lawful owner of the Collateral, free and clear of all liens and
encumbrances of any nature whatsoever, other than liens in favor of ▇▇▇▇▇▇ ▇▇▇
in connection with ▇▇▇▇▇▇ Mae Mortgage Loans, provided such liens relate to the
subject Mortgage Loan.
6.6 USE OF PROCEEDS. The proceeds of the Loan shall be used solely and
exclusively for those matters set forth in Section 1.2.
6.7 ORGANIZATION.
------------
The Borrower is a duly organized validly existing corporation in good
standing under the laws of Delaware and is duly qualified in the jurisdiction
where the nature of its business is such that qualification is required and
where failure to be so qualified would materially adversely affect its business
14
or assets, and has all requisite power and authority to conduct its business and
to own its property, as now conducted or owned, and as contemplated by this
Agreement.
6.7.1 OWNERSHIP, SUBSIDIARIES AND TAXPAYER IDENTIFICATION NUMBERS.
-----------------------------------------------------------
(i) All of the stockholders of the Borrower and a description of the
ownership interests held by the same, and of each of the Borrower's
Subsidiaries, are listed on SCHEDULE 6.7.1 and no additional ownership
interests, or rights or instruments convertible into such ownership
interests, exist.
(ii) The taxpayer identification numbers and state organizational
numbers (if applicable) of the foregoing Persons are accurately stated on
SCHEDULE 6.7.1.
(iii) The Borrower and the Guarantors are each the owner, free and
clear of all liens and encumbrances, of all of the issued and outstanding
capital stock, membership interests or other equity interests of each of
their respective Subsidiaries, except that (u) CM Corp. is the owner of the
issued and outstanding capital stock of the Borrower, to the extent set
forth on SCHEDULE 6.7.1, (v) CM Corp. is the owner of all of the issued and
outstanding common units of Charter Mac Capital, only, and to avoid any
misunderstanding, CM Corp. has no legal or beneficial interest in the
special common units issued pursuant to the Constituent Documents of
Charter Mac Capital, (w) for those Persons created by RCC and its
Subsidiaries for development joint ventures in the ordinary course of
business, RCC and its Subsidiaries may not own all of the equity interests
in such Persons, (x) CM Corp. is the owner of all of the issued and
outstanding common units of CM Investor LLC, only, and to avoid any
misunderstanding, CM Corp. has no legal or beneficial interest in the
special membership units issued pursuant to the Constituent Documents of
Charter Mac Capital, (y) that CharterMac has pledged to Fleet National Bank
all of its legal and beneficial ownership interest in CM Holding Trust, and
(z) CM Holding Trust has pledged to Fleet National Bank all of its legal
and beneficial ownership interest in CHARTER MAC EQUITY ISSUER TRUST.
Except as set forth on SCHEDULE 6.7.1, all shares of such stock, membership
interests, or other equity interests have been validly issued and are fully
paid and nonassessable and no rights to subscribe to any additional shares
have been granted, and no options, warrants, or similar rights are
outstanding except as set forth on SCHEDULE 6.7.1.
6.7.2 AUTHORIZATION. The execution, delivery and performance of this
Agreement and the other Loan Documents to which the Borrower and the
Guarantors are to become a party and the transactions contemplated hereby
and thereby (i) are within the authority of such Person, (ii) have been
duly authorized by all necessary corporate proceedings, (iii) do not
conflict with or result in any breach or contravention of any Legal
Requirement to which such Person is subject or any judgment, order, writ,
injunction, license or permit applicable to such Person, and (iv) do not
conflict with any provision of such Person's organization documents or
other charter documents or bylaws of, or Contractual Obligation, except
where such conflict would not have a materially adverse effect on the
business, assets or financial condition of such Person.
6.8 VALID AND BINDING. Each of the Loan Documents constitute legal, valid
and binding obligations of the Borrower and the Guarantors under the respective
Loan Document to which they are party, in accordance with the respective terms
thereof, subject to bankruptcy, insolvency and similar laws of general
application affecting the rights and remedies of creditors and, with respect to
the availability of the remedies of specific enforcement, subject to the
discretion of the court before which any proceeding therefor may be brought.
6.9 DEFERRED COMPENSATION AND ERISA. Neither the Borrower nor any entity
that could be treated as a single employer with the Borrower under Internal
Revenue Code Section 414(b), (c), (m), (n) or (o), now or at any time during the
sixty month period ending on the date hereof, sponsor(ed), maintain(ed) or
contribute(d) to (or have or had an obligation to contribute to) any pension,
profit sharing, stock option, insurance or other arrangement or plan for current
or former employees that is subject to Title IV of the Employer Retirement
Income Security Act of 1974, as now or hereafter amended ("ERISA") or ERISA
Section 302 except as may be identified to Agent in writing (which writing shall
be supplemented, within 30 days of Agent's request, by a copy of the arrangement
or plan, and the financial statements and accountant's reports for such
arrangement or plan) by the Borrower from time to time ("ERISA Plan") and no
"Reportable Event," as defined for purposes of Section 4043 of ERISA, has
occurred with respect to any such ERISA Plan. The granting of the Loan, the
performance by the Borrower of its obligations under the Loan Documents, and the
15
Borrower's conducting of its operations do not and will not violate any
provisions of ERISA or any ERISA Plan.
6.10 NO MATERIALLY ADVERSE CONTRACTS, ETC. None of the Borrower or the
Guarantors nor any of their respective Subsidiaries is subject to any charter,
corporate or other legal restriction, or any judgment, decree, order, rule or
regulation that has or is expected in the future to have a materially adverse
effect on the business, assets or financial condition of such Person. None of
the Borrower or the Guarantors nor any of their respective Subsidiaries is a
party to any contract or agreement that has or is expected, in the judgment of
the such Person's officers, to have any materially adverse effect on the
business of such Person or such Person's Subsidiaries.
6.11 COMPLIANCE WITH OTHER INSTRUMENTS, LAWS, ETC. None of the Borrower or
the Guarantors nor any of their respective Subsidiaries is in violation of any
provision of its charter or other organization documents, by-laws, or any
Contractual Obligations or any Legal Requirements, in any of the foregoing cases
in a manner that could result in the imposition of substantial penalties or
materially and adversely affect the financial condition, properties or business
of such Person or such Person's Subsidiaries.
6.12 TAX STATUS. The Borrower and the Guarantors and their respective
Subsidiaries (a) have made or filed all federal and state income and all other
tax returns, reports and declarations required by any jurisdiction to which such
Person is subject, (b) have paid all taxes and other governmental assessments
and charges shown or determined to be due on such returns, reports and
declarations, except those being contested in good faith and by appropriate
proceedings with adequate reserves taken in accordance with GAAP, and (c) have
set aside on its books provisions reasonably adequate for the payment of all
taxes for periods subsequent to the periods to which such returns, reports or
declarations apply. Except for taxes being contested as provided in clause (b),
above, there are no unpaid taxes in any material amount claimed to be due by the
taxing authority of any jurisdiction, and the officers of the foregoing Persons
know of no basis for any such claim.
6.13 HOLDING COMPANY AND INVESTMENT COMPANY ACTS. None of the Borrower nor
any of its Subsidiaries is a "holding company", or a "subsidiary company" of a
"holding company", or an "affiliate" of a "holding company", as such terms are
defined in the Public Utility Holding Company Act of 1935; nor is it an
"investment company", or an "affiliated company" or a "principal underwriter" of
an "investment company", as such terms are defined in the Investment Company Act
of 1940.
6.14 CERTAIN TRANSACTIONS. Except as set forth in SCHEDULE 6.14 hereof, as
of the date of this Agreement, none of the officers, trustees, directors, or
employees of the Borrower or any of their Subsidiaries is presently a party to
any transaction with the Borrower or any of their Subsidiaries (other than for
services as employees, officers and directors), including any contract,
agreement or other arrangement (i) providing for the furnishing of services to
or by, (ii) providing for rental of real or personal property to or from, or
(iii) otherwise requiring payments to or from, any officer, trustee, director or
such employee or any corporation, partnership, trust or other entity in which
any officer, trustee, director, or any such employee has a substantial interest
or is an officer, director, trustee or partner.
6.15 REGULATIONS U AND X. No portion of any Warehousing Advance is to be
used for the purpose of purchasing or carrying any "margin security" or "margin
stock" as such terms are used in Regulations U and X of the Board of Governors
of the Federal Reserve System, 12 C.F.R. Parts 221 and 224.
6.16 LOAN DOCUMENTS. All of the representations and warranties of the
Borrower and the Guarantors made in their respective Loan Documents are true and
correct in all material respects.
6.17 NO MATERIAL CHANGE: NO DEFAULT. There has been no material adverse
change in the financial condition, business, affairs of any of the Borrower or
the Guarantors, or their respective Subsidiaries since the date of its last
financial statement most recently delivered to the Agent. No Default exists
under any of the Loan Documents.
16
6.18 NO BROKER OR FINDER. None of the Borrower nor anyone on behalf thereof
has dealt with any broker, finder or other person or entity who or which may be
entitled to a broker's or finder's fee, or other compensation, payable by the
Agent or any of the Lenders in connection with this Loan.
6.19 BACKGROUND INFORMATION AND CERTIFICATES. All of the factual
information contained or referred to in Section 1 of this Agreement and in the
Exhibits and Schedules to this Agreement, and in the certificates furnished to
the Agent or any of the Lenders by or on behalf of the Borrower or the
Guarantors in connection with this Agreement or any other Loan Document, is true
and complete in all material respects, and omits no material fact necessary to
make the same not misleading.
6.20 SERVICING. SCHEDULE 6.20 is a true and complete list of the Borrower's
Servicing Portfolio. All of the Borrower's Servicing Contracts are in full force
and effect, and are unencumbered by Liens. No default or event that, with notice
or lapse of time or both, would become a default, exists under any of the
Borrower's Servicing Contracts.
6.21 ASSUMED NAMES The Borrower does not originate Mortgage Loans or
otherwise conduct business under any names other than its legal name and the
assumed names set forth on SCHEDULE 6.21. The Borrower has made all filings and
taken all other action as may be required under the laws of any jurisdiction in
which it originates Mortgage Loans or otherwise conducts business under any
assumed name. The Borrower's use of the assumed names set forth on SCHEDULE 6.21
does not conflict with any other Person's legal rights to any such name, nor
otherwise give rise to any liability by the Borrower to any other Person.
Each request by the Borrower for a Warehousing Advance: (i) shall
constitute an affirmation by the Borrower on behalf of itself that the foregoing
representations and warranties remain true and correct as of the date of such
request (except as to matters specifically disclosed in writing to Agent and
each of the Lenders prior to or simultaneously with such written request, and
except to the extent of changes resulting from transactions contemplated and
permitted by this Agreement and the other Loan Documents and changes occurring
in the ordinary course of business that singly or in the aggregate are not
materially adverse, and except to the extent that such representations and
warranties relate expressly to an earlier date) and, unless Agent and each of
the Lenders is notified to the contrary prior to the disbursement of the
requested Warehousing Advance, will be so on the date of such Warehousing
Advance, and (ii) shall constitute the representation and warranty of the
Borrower that the information set forth in each such request is true and correct
and omits no material fact necessary to make the same not misleading.
7. COVENANTS. The Borrower covenants and agrees that from the date hereof and
so long as Lenders have any obligation to make the Warehousing Advance
hereunder, or any indebtedness is outstanding hereunder, or any Warehousing
Advance or other Obligations remain outstanding, as follows:
7.1 PUNCTUAL PAYMENT. The Borrower will duly and punctually pay or cause to
be paid the principal and interest on the Loan and all interest, fees and other
Obligations provided for in this Agreement, all in accordance with the terms of
this Agreement and the Notes, as well as all other sums owing pursuant to the
Loan Documents.
7.2 MAINTENANCE OF OFFICE. The Borrower will maintain its chief executive
office in Jersey City, New Jersey, or at such other place in the United States
of America as the Borrower shall designate upon not less than forty five (45)
days prior written notice to the Agent.
7.3 RECORDS AND ACCOUNTS. The Borrower will (a) keep, and cause each of its
Subsidiaries to keep, true and accurate records and books of account in which
full, true and correct entries will be made in accordance with GAAP and (b)
maintain adequate accounts and reserves for all taxes (including income taxes),
depreciation and amortization of its properties and the properties of its
Subsidiaries, contingencies, and other reserves.
7.4 NOTICES.
-------
7.4.1 DEFAULTS. The Borrower will promptly notify the Agent in writing
of the occurrence of any Default known to the Borrower. If any Person shall give
any notice or take any other action in respect of a claimed default (whether or
17
not constituting a Default) under this Agreement or under any note, evidence of
indebtedness, indenture or other obligation to which or with respect to which
the Borrower or any of its Subsidiaries is a party or obligor, whether as
principal or surety, and such default would permit the holder of such note or
obligation or other evidence of indebtedness to accelerate the maturity thereof,
which acceleration would have a material adverse effect on the Borrower, the
Borrower shall forthwith give written notice thereof to the Agent, describing
the notice or action and the nature of the claimed default.
7.4.2 NOTIFICATION OF CLAIMS AGAINST COLLATERAL. The Borrower will,
promptly upon (but in any event not later than ten (10) days after) becoming
aware thereof, notify the Agent in writing of any events relating to the
Collateral that materially adversely affect the rights of the Agent or the
Lenders with respect thereto.
7.4.3 NOTICE OF LITIGATION AND JUDGMENTS. The Borrower will, and will
cause each of its Subsidiaries, the Guarantors and any Subsidiaries of the
Guarantors to, give notice to the Agent and each of the Lenders in writing
(within ten (10) days of the date on which any such Person shall become aware
thereof) of any litigation or proceedings threatened or any pending litigation
and proceedings affecting such Person or to which such Person is or is to become
a party involving an amount in controversy exceeding $250,000.00 or that could
reasonably be expected to have a materially adverse effect on such Person and
stating the nature and status of such litigation or proceedings. The Borrower
will, and will cause each of its Subsidiaries, the Guarantors and any
Subsidiaries of the Guarantors to, give notice to the Agent and each of the
Lenders, in writing, in form and detail satisfactory to the Agent and each of
the Lenders, (within ten (10) days of the date on which any such Person shall
become aware thereof) of any judgment in excess of $250,000.00 not covered by
insurance, final or otherwise, against such Persons.
7.4.4 ELIGIBILITY IMPAIRED. The Borrower will give notice to the Agent
and each of the Lenders of (x) the suspension, revocation or termination of the
Borrower's eligibility, in any respect, as approved lender, seller/servicer or
issuer as described under Section 8.1, and (y) the transfer, loss, nonrenewal or
termination of any Servicing Contracts to which the Borrower is a party, or
which is held for the benefit of the Borrower, and the reason for that transfer,
loss, nonrenewal or termination.
7.5 FINANCIAL STATEMENTS AND REPORTS. The Borrower shall furnish or cause
to be furnished to the Agent and each of the Lenders from time to time, the
following financial statements and reports and other information, all in form,
manner of presentation and substance reasonably acceptable to Agent:
7.5.1 ANNUAL STATEMENTS. As soon as practicable, but in any event not
later than one hundred twenty (120) days after the end of each fiscal year of
the Borrower, the audited consolidated and unaudited consolidating balance sheet
of the Borrower and its Subsidiaries at the end of such year, and the related
statements of earnings and cash flows for such year, each setting forth in
comparative form the figures for the previous fiscal year and all such
statements to be in reasonable detail, prepared in accordance with GAAP, and
accompanied by an auditor's report prepared without qualification by an
independent certified public accountant reasonably acceptable to the Agent.
7.5.2 PROJECTIONS. As soon as practicable, but no later than
forty-five (45) days prior to the end of each fiscal year of the Borrower, the
Borrower shall provide the Agent with the operating projections for the Borrower
for the next fiscal year in a form satisfactory to the Agent.
7.5.3 QUARTERLY STATEMENTS. As soon as practicable, but in any event
not later than forty-five (45) days after the end of each fiscal quarter of the
Borrower (including for the fourth fiscal quarter, which shall be subject to
normal year end audit adjustments), the management prepared consolidating
balance sheet of the Borrower and its Subsidiaries at the end of such quarter,
and the related management prepared consolidating statements of earnings for
such quarter, each setting forth in comparative form the figures for the
previous fiscal quarter and all such statements to be in reasonable detail,
prepared in accordance with GAAP.
7.5.4 PIPELINE REPORTS At the Agent's request, a commitment summary
and pipeline report dated as of the end of such month.
18
7.5.5 PUBLIC FILINGS. Within ten (10) Business Days after the filing
or mailing thereof, copies of all material of a financial nature filed with the
Securities and Exchange Commission or sent to the public stockholders of
CharterMac.
7.5.6 COMPLIANCE CERTIFICATE. Concurrently with the delivery of the
financial statements referred to in Sections 7.5.1, 7.5.2 and 7.5.3 above, a
certificate (to be in the form of EXHIBIT G or on such other form as the Agent
may from time to time prescribe) of an Authorized Representative stating that,
to the best of such Authorized Representative's knowledge, the Borrower and each
of the Guarantors during such period observed or performed in all material
respects all of their covenants and other agreements, and satisfied in all
material respects every material condition, contained in this Agreement or the
other Loan Documents to be observed, performed or satisfied by them, and that
such Authorized Representative has obtained no knowledge of any Default except
as specified in such certificate and such certificate shall include the
calculations in reasonable detail required to indicate the Borrower's compliance
with Section 7.26.
7.5.7 ACCOUNTANT'S LETTERS. Contemporaneously with the Borrower's
receipt thereof, copies of all accountants' management letters delivered to the
Borrower, its Subsidiaries, either of the Guarantors or any of the Guarantors'
Subsidiaries.
7.5.8 SERVICING PORTFOLIO REPORT. As soon as available and in any
event within 60 days after the end of each calendar quarter, a consolidated
report ("Servicing Portfolio Report") as of the end of the calendar quarter, as
to all Mortgage Loans the servicing rights to which are owned by the Borrower
(specified by investor type, recourse and non-recourse) regardless of whether
the Mortgage Loans are Pledged Loans. The Servicing Portfolio Report must
indicate which Mortgage Loans (1) are current and in good standing, (2) are more
than 30, 60 or 90 days past due, (3) are the subject of pending bankruptcy or
foreclosure proceedings, or (4) have been converted (through foreclosure or
other proceedings in lieu of foreclosure) into real estate owned by, the
Borrower.
7.5.9 PRODUCTION REPORT. As soon as available and in any event within
forty-five (45) days after the end of each fiscal quarter in the Borrower's
fiscal year, a consolidated loan production report as of the end of that fiscal
quarter, presenting the total dollar volume and the number of Mortgage Loans
originated and closed or purchased during that fiscal quarter and for the fiscal
year-to-date, specified by property type and loan type.
7.5.10 OTHER REPORTS. Other reports in respect of Pledged Assets, in
such detail and at such times as Agent in its discretion may reasonably request.
7.5.11 AGENCY NOTICES. With reasonable promptness, such further
information regarding the business, operations, properties or financial
condition of the Borrower as Agent may reasonably request, including copies of
any audits completed by HUD, ▇▇▇▇▇▇ Mae, ▇▇▇▇▇▇ ▇▇▇ or ▇▇▇▇▇▇▇ Mac, as well as
any material notices to the Borrower from any of the foregoing Persons.
7.5.12 VALUATION OF SERVICING PORTFOLIO As soon as practicable, but in
any event not later than sixty (60) days after the end of each fiscal quarter of
the Borrower, the management prepared valuation of Servicing Portfolio in form
and substance satisfactory to the Lender.
7.5.13 ADDITIONAL FINANCIAL INFORMATION. From time to time, within a
reasonable period of time of the request, such other financial data and
information as the Agent or any Lender may reasonably request.
7.6 EXISTENCE; CONDUCT OF BUSINESS.
------------------------------
7.6.1 (a) Except as a consequence of a transaction permitted pursuant
to Section 7.18.1 (i), the Borrower will do or cause to be done all things
necessary to preserve and keep in full force and effect its existence as a
Delaware corporation.
(b) The Borrower will do or cause to be done all things necessary
to preserve and keep in full force all of its rights and franchises, except
where such failure would not have a material adverse effect on the business,
assets or financial condition of the Borrower or any Guarantor or any of their
Subsidiaries.
19
(c) The Borrower will only engage in the mortgage banking
business with a primary focus on multifamily mortgages consistent with its
historical business.
7.6.2 Without limiting the provisions of Section 7.6.1, the Borrower
shall preserve and maintain all of its rights, privileges, licenses and
franchises necessary or desirable in the normal conduct of its business,
including its eligibility as lender, seller/servicer and issuer described under
Section 8.1; conduct its business in an orderly and efficient manner; maintain a
net worth of acceptable assets as required for maintaining their respective
eligibilities as lender, seller/servicer and issuer described under Section 8.1;
and make no material change in the nature or character of its business or engage
in any business in which it was not engaged on the date of this Agreement,
except as permitted by the Agreement.
7.7 INSURANCE. SCHEDULE 7.7 sets forth all presently existing insurance
maintained by the Borrower. The Borrower will maintain insurance with respect to
its other properties, and will cause each of its Subsidiaries to maintain with
financially sound and reputable insurers, insurance with respect to such
properties and its business against such casualties and contingencies as shall
be in accordance with the general practices of businesses engaged in similar
activities in similar geographic areas and in amounts, containing such terms, in
such forms and for such periods as may be reasonable and prudent.
7.8 TAXES AND TRADE DEBT. The Borrower will, and will cause each of its
Subsidiaries to, duly pay and discharge, or cause to be paid and discharged,
before the same shall become overdue, all taxes, assessments and other
governmental charges imposed upon it and its real properties, sales and
activities, or any part thereof, or upon the income or profits therefrom, except
for those taxes, assessments or charges which any such Person is contesting in
good faith by appropriate proceedings and with respect to which appropriate
reserves have been established and are being maintained in accordance with GAAP.
7.9 COMPLIANCE WITH LAWS, CONTRACTS, LICENSES, AND PERMITS. Except where
the failure to comply would not have a material adverse effect on the business,
operations, properties, assets, or financial condition of the Borrower or the
Guarantors and their respective Subsidiaries, the Borrower will comply with, and
will cause each of the foregoing Persons to comply with (a) all applicable Legal
Requirements now or hereafter in effect wherever its business is conducted, (b)
the provisions of its Constituent Documents, (c) all of such Person's
Contractual Obligations, (d) all agreements and instruments to which it is a
party or by which it or any of its properties may be bound and (e) all
applicable decrees, orders, and judgments. If at any time while any Obligation
is outstanding or the Lenders have any obligation to make Warehousing Advances
hereunder any Governmental Authorization or other third party consents,
approvals, or notifications shall become necessary or required in order that
Borrower may fulfill any of its obligations hereunder, the Borrower will
promptly take or cause to be taken all reasonable steps within the power of the
Borrower to obtain such Governmental Authorization or other third party
consents, approvals, or notifications, and furnish the Agent and the Lenders
with evidence thereof, unless the failure to do so would not have a material
adverse affect on the Borrower, any of the Guarantors or any of their respective
Subsidiaries.
7.10 BANK ACCOUNTS. To permit the Agent to monitor the financial
performance of the Borrower, the Borrower shall maintain its sole Operating
Accounts, other primary deposit and investment accounts, and all escrow and
custodial accounts with Fleet National Bank, a Bank of America Company.
Notwithstanding the foregoing, the Borrower shall be permitted to maintain the
▇▇▇▇▇▇ Mae Reserve Account at US Bank.
7.11 CLOSING INSTRUCTIONS. The Borrower shall Indemnify and hold Agent and
each Lender and all those claiming by, through or under the Agent and each of
the Lenders, harmless from and against any loss, including reasonable attorneys'
fees and costs, attributable to the failure of any title insurance company,
agent or approved attorney to comply with Borrower's disbursement or instruction
letter relating to any Mortgage Loan. Agent has the right to pre-approve the
Borrower's disbursement or instruction letter to the title insurance company,
agent or approved attorney in any case in which the Borrower intends to obtain a
Warehousing Advance against the Mortgage Loan to be created at settlement or to
pledge that Mortgage Loan as Collateral under this Agreement. The Borrower's
disbursement or instruction letter must state that Agent, for the benefit of the
Lenders has a security interest in any amounts advanced to fund a Mortgage Loan
and in the Mortgage Loan funded with those amounts and must require the title
insurance company, agent or approved attorney involved in the transaction to
return any amounts advanced by any Lender and not used to fund the Mortgage
Loan.
20
7.12 OTHER LOAN OBLIGATIONS The Borrower shall perform all of its material
obligations under the terms of each loan agreement, note, mortgage, security
agreement or debt instrument by which the Borrower is bound or to which any of
its property is subject, and promptly notify Lender in writing of a declared
default under or the termination, cancellation, reduction or nonrenewal of any
of its other lines of credit or agreements with any other lender. SCHEDULE 7.12
is a true and complete list of all such lines of credit or agreements as of the
date of this Agreement.
7.13 FURTHER ASSURANCES. The Borrower will cooperate with, and will cause
each of the Guarantors and its and their Subsidiaries to cooperate with, the
Agent and the Lenders and each such Person execute such further instruments and
documents as any Lender or the Agent shall reasonably request to carry out to
their satisfaction the transactions contemplated by this Agreement and the other
Loan Documents.
7.14 RESTRICTIONS ON LIENS, TRANSFERS AND ADDITIONAL DEBT.
----------------------------------------------------
7.14.1 RESTRICTIONS ON INDEBTEDNESS. The Borrower will not, and will
not permit any of its Subsidiaries to, create, incur, assume, guarantee or be or
remain liable, contingently or otherwise, with respect to any Indebtedness other
than:
(i) Indebtedness to the Lenders arising under any of the Loan
Documents;
(ii) Current liabilities of the Borrower or its Subsidiaries
incurred in the ordinary course of business but not incurred through (i)
the borrowing of money, or (ii) the obtaining of credit except for credit
on an open account basis customarily extended and in fact extended in
connection with normal purchases of goods and services;
(iii) Indebtedness in respect of taxes, assessments, governmental
charges or levies and claims for labor, materials and supplies to the
extent that payment therefor shall not at the time be required to be made
in accordance with the provisions of Section 7.8;
(iv) Secured purchase money debt or capitalized lease
obligations;
(v) Indebtedness in respect of judgments or awards that have been
in force for less than the applicable period for taking an appeal so long
as execution is not levied thereunder or in respect of which the Borrower
shall at the time in good faith be prosecuting an appeal or proceedings for
review and in respect of which a stay of execution shall have been obtained
pending such appeal or review;
(vi) Endorsements for collection, deposit or negotiation and
warranties of products or services, in each case incurred in the ordinary
course of business;
(vii) Up to $750,000 of Indebtedness incurred in the ordinary
course of business for capital expenditures (e.g computer system);
(viii) Indebtedness to ▇▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇ Mac, ▇▇▇▇▇▇ ▇▇▇, FHA
or other parties with whom the Borrower and its Subsidiaries originate,
sell, repurchase or service Mortgage Loans, to the extent directly relating
to or arising out of such origination, sale, repurchase, or servicing in
the ordinary course of business consistent with past practices;
(ix) Indebtedness secured by real property acquired upon
foreclosure of Mortgages, which, either (x) is so secured at the time of
such acquisition, or (y) is directly related to such real property, not in
excess of the fair market value thereof, and reasonably expected by the
Borrower or the subject Subsidiary to be recovered from the sale or other
disposition of the subject real property;
(x) Unsecured Indebtedness for borrowed money incurred in the
ordinary course of business and not exceeding $750,000, plus intercompany
liabilities which have a maturity date which is later than the Maturity
Date and which are subordinated to the Obligations pursuant to
21
subordination agreements reasonably satisfactory to the Agent which shall
permit repayment as long as (A) no Default then exists, and (B) no Default
would thereupon occur (including on a pro forma basis as if applicable
financial covenants were tested as of the date of such repayment;
(xi) Indebtedness (exclusive of the Indebtedness referred to in
clause (x) above) incurred to finance no greater than 100% of the purchase
or leasing of equipment, in the ordinary course of business;
(xii) Indebtedness incurred in the ordinary course of business
secured by one or more specific assets, in each instance the principal
amount of which shall not exceed the GAAP book value of the subject
asset(s);
(xiii) Guaranties by the Borrower for the benefit of ▇▇▇▇▇▇▇ Mac
or ▇▇▇▇▇▇ ▇▇▇ regarding obligations of Capri Capital Finance LLC, or any of
the Borrower's Subsidiaries in the ordinary course of business consistent
with past practices; and
(xiv) other Indebtedness existing on the date of this Agreement
and listed and described on SCHEDULE 7.14.1 hereto.
7.14.2 RESTRICTIONS ON LIENS, ETC. Except in connection with its
purchase, origination and sale from time to time of Mortgage Loans and related
assets in the ordinary course of business as conducted on the Agreement Date,
the Borrower will not, and will not permit any of its Subsidiaries to, (a)
create or incur or suffer to be created or incurred or to exist any lien,
encumbrance, mortgage, pledge, charge, restriction or other security interest of
any kind upon any of its property or assets of any character whether now owned
or hereafter acquired, or upon the income or profits therefrom; (b) transfer any
of its property or assets or the income or profits therefrom for the purpose of
subjecting the same to the payment of Indebtedness or performance of any other
obligation in priority to payment of its general creditors; (c) acquire, or
agree or have an option to acquire, any property or assets upon conditional sale
or other title retention or purchase money security agreement, device or
arrangement; (d) suffer to exist for a period of more than thirty (30) days
after the same shall have been incurred any Indebtedness or claim or demand
against it that if unpaid might by law or upon bankruptcy or insolvency, or
otherwise, be given any priority whatsoever over its general creditors; or (e)
sell, assign, pledge or otherwise transfer any accounts, contract rights,
general intangibles, chattel paper or instruments, with or without recourse; (f)
agree to a negative pledge in favor of any Person other than the Agent or the
Lenders pursuant to the Acquisition Facility with respect to any assets or
rights, now owned or hereafter arising provided that the Borrower and any
Subsidiary of the Borrower may create or incur or suffer to be created or
incurred or to exist:
(i) liens on properties to secure taxes, assessments and other
government charges or claims for labor, material or supplies in respect of
obligations not overdue or which are being contested in good faith by
appropriate proceedings for which adequate reserves determined in
accordance with GAAP have been established (and as to which the property
subject to any such lien is not yet subject to foreclosure, sale,
collection, levy or loss on account thereof);
(ii) deposits or pledges made in connection with, or to secure
payment of, workmen's compensation, unemployment insurance, old age
pensions or other social security obligations;
(iii) liens on properties the Indebtedness with respect to which
is permitted by Section 7.14.1(iv);
(iv) presently outstanding liens listed on SCHEDULE 7.14.2
hereto;
(v) liens in favor of the Agent and the Lenders under the Loan
Documents; liens securing Indebtedness to ▇▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇ Mac, ▇▇▇▇▇▇
▇▇▇, FHA or other parties with whom the Borrower or its Subsidiaries
originate, sell, repurchase or otherwise service Mortgage Loans provided
such liens relate to the foregoing transactions, but only to the extent
directly relating to or arising out of such origination, sale, repurchase,
or servicing in the ordinary course of business;
22
(vi) liens securing Indebtedness secured by real property
acquired upon foreclosure of Mortgages, which either (x) is so securing at
the time of such acquisition, or (y) is directly related to such real
property, not in excess of the fair market value thereof, and reasonably
expected by the Borrower or the subject Subsidiary to be recovered from the
sale or other disposition of the subject real property;
(vii) liens arising from good faith deposits in connection with
or to secure performance of tenders, bids, leases, government contracts,
performance and return-of-money bonds and other similar obligations
incurred in the ordinary course of business (other than obligations in
respect of the payment of borrowed money);
(viii) liens arising from good faith deposits in connection with
or to secure performance of statutory obligations and surety and appeal
bonds;
(ix) easements, rights-of-way, restrictions (including zoning
restrictions), matters of plat, minor defects or irregularities in title
and other similar charges or encumbrances not, in any material respect,
impairing the use of the encumbered property for its intended purposes;
(x) liens securing Indebtedness permitted pursuant to Section
7.14.1(xi), provided such lien does not extend beyond the equipment which
is the subject of the Indebtedness;
(xi) liens securing credit enhancement products supporting
multi-family housing project bonds or other financing of multi-family
housing projects in the ordinary course of business which indebtedness is
permitted pursuant to Section 7.12.1(xiv)(A);
(xii) liens in favor of ▇▇▇▇▇▇ Mae in connection with ▇▇▇▇▇▇ ▇▇▇
Mortgage Loans, provided such liens relate to the subject Mortgage Loan.
7.15 DISTRIBUTIONS. So long as no Default has occurred and is continuing
(unless waived by Agent and the Requisite Lenders as set forth in Section
11.4.1), or will occur with the making of any such payment or distributions, the
Borrower may make any payments or distributions to the Guarantors and Affiliates
of the Guarantor ("Permitted Distributions"). Other than Permitted
Distributions, the Borrower shall make no payments or distributions to the
Guarantors or Affiliates of the Guarantors.
7.16 RESTRICTIONS ON INVESTMENTS. The Borrower will not, and will not
permit any of its Subsidiaries to make or permit to exist or to remain
outstanding any Investment except an Investment which is in:
(i) Cash Equivalents (provided, however, the ▇▇▇▇▇▇ Mae Reserve
Account may be invested for a period that exceeds 364 days); and
(ii) property acquired in the normal and ordinary course of the
Borrower's present business of originating and purchasing Mortgage Loans
(including property acquired on foreclosure of Mortgages and, as to the
Borrower and its Subsidiaries, the origination and purchase of Mortgage
Loans in the ordinary course of their business) as conducted on the
Agreement Date and any other business permitted under this Agreement.
7.17 INDEMNIFICATION AGAINST PAYMENT OF BROKERS' FEES. The Borrower agrees
to defend, indemnify and hold harmless Agent and each of the Lenders from and
against any and all liabilities, damages, penalties, costs, and expenses,
relating in any manner to any brokerage or finder's fees in respect of the
Facility (except as resulting from the Agent's or any Lender's action).
7.18 MERGER, CONSOLIDATION.
---------------------
7.18.1 The Borrower will not, and will not permit any of its
Subsidiaries to, become a party to any merger or consolidation, or agree to or
effect any asset acquisition or disposition or stock acquisition or disposition
(other than the acquisition or disposition of assets in the ordinary course of
23
business consistent with past practices, including the acquisition or
disposition of Mortgage Loans and property acquired on foreclosure of Mortgages)
except (i) the merger or consolidation of one or more of the Subsidiaries of the
Borrower with and into the Borrower, (ii) the merger or consolidation of two or
more Subsidiaries of the Borrower, and (iii) other dispositions of Service
Contracts in an amount not to exceed five percent (5%) of the Servicing
Portfolio during any twelve (12) month period.
7.18.2 The Borrower will not, and will not permit any of its
Subsidiaries to cease actively to engage in the business of originating or
acquiring Mortgage Loans or make any other material change in the nature or
scope of the business in which each such Person engages as of the date of this
Agreement.
7.18.3 The Borrower will not, and will not permit any of its
Subsidiaries to sell, assign, lease, convey, transfer or otherwise dispose of
(whether in one transaction or a series of transactions) all or any substantial
part of such Person's business or assets, whether now owned or acquired after
the Closing Date, other than, in the ordinary course of business consistent with
past practices and to the extent not otherwise prohibited by this Agreement, to
a Subsidiary of the Borrower, and sales of (1) Mortgage Loans, (2)
Mortgage-backed Securities , (3) Servicing Contracts and (4) other dispositions
of Serviced Loans in an amount not to exceed five percent (5%) of the Servicing
Portfolio during any twelve (12) month period.
7.18.4 The Borrower will not, and will not permit any of its
Subsidiaries to issue any additional ownership interests, or rights or
instruments convertible into such ownership interests, except for (i) Permitted
Transfers, and (ii) those transactions set forth on SCHEDULE 6.7.1.
7.18.5 The Borrower will not, and will not permit any of its
Subsidiaries to change its or their respective taxpayer identification numbers
and state organizational numbers unless such Person shall have provided the
Agent with not less than forty-five days prior written notice.
7.19 SUBSIDIARIES. The Borrower may acquire, form or otherwise invest in a
Subsidiary which engages in the mortgage banking business primarily involving
multi-family mortgages, including purchasing, servicing and originating such
mortgages. Any Subsidiary created or acquired by the Borrower shall constitute a
"Borrower" as referred to herein. The Borrower acknowledges and covenants that
upon the creation or acquisition of any new Subsidiary permitted hereby, at the
Agent's option such Subsidiary shall execute and deliver to the Agent an
agreement reasonably satisfactory to the Agent under which such Subsidiary joins
this Agreement as a Borrower.
7.20 LOANS AND ADVANCES. Except as permitted in Section 7.14.1 and 7.16,
the Borrower will not and will not permit any of its Subsidiaries to, make any
loans or advances to any Person other than advances to the Borrower's or its
Subsidiaries' employees in the ordinary course of business for reasonable
expenses to be incurred by such employees for the benefit of the Borrower or
such Subsidiaries. Notwithstanding the foregoing, the Borrower may purchase and
originate Mortgage Loans in the ordinary course of business consistent with past
practices.
7.21 FISCAL YEAR. The fiscal year of the Borrower and its Subsidiaries
presently ends on December 31 of each year. If the Borrower shall change its
fiscal year end, the Borrower shall promptly furnish the Agent with written
notice thereof.
7.22 CHARGING ACCOUNTS. Agent is hereby authorized, on or after the due
date, to charge the Cash Collateral Account at Agent with the amount of all
principal and interest payments due under this Agreement, the Notes or the other
Loan Documents and upon the occurrence and during the continuation of an Event
of Default, the Agent or any of the Lenders is hereby authorized on or after the
due date, to charge such account at Agent, or any other deposit account of the
Borrower at Agent or any of the Lenders, with the amount of all unpaid fees,
costs and expenses to which the Agent and the Lenders are entitled under this
Agreement. The failure of Agent to so charge such account shall not affect or
limit the Borrower's obligation to make any required payment.
7.23 PLACE FOR RECORDS; INSPECTION.
-----------------------------
24
s
7.23.1 The Borrower shall, and shall cause each of its Subsidiaries
to, maintain all of their business records as follows: (x) as to the Borrower,
▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ or ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇. Upon reasonable notice and at reasonable
times during normal business hours Agent and each Lender shall have the right
(through such agents or consultants as Agent or any Lender may designate) to
examine the foregoing Persons' property and make copies of and abstracts from
such Persons' books of account, correspondence and other records and to discuss
its financial and other affairs with any of its senior officers and any
accountants hired by any of the foregoing Persons, it being agreed that the
Agent and each Lender shall not divulge information obtained from such
examination to others except in connection with Legal Requirements and in
connection with administering the Loan, enforcing their rights and remedies
under the Loan Documents and in the conduct, operation and regulation of its
banking and lending business (which may include, without limitation, the
transfer of the Loan or of participation interests therein). Any transferee of
the Loan or any holder of a participation interest in the Loan shall be entitled
to deal with such information in the same manner and in connection with any
subsequent transfer of its interest in the Loan or of further participation
interests therein.
7.23.2 Without limiting the rights of the Agent and the Lenders under
Section 7.23.1, above, the Borrower shall permit the Agent, at the Borrower's
expense, to undertake semi-annual appraisals of the Servicing Rights by any
Approved Servicing Rights Appraiser, PROVIDED, HOWEVER, that so long as no
Default has occurred and is continuing, there shall be not more than two such
appraisals in any twelve month period.
7.24 COSTS AND EXPENSES. Whether or not the transactions contemplated
hereby shall be consummated, the Borrower agrees to pay promptly: (a) all the
actual and reasonable out-of-pocket costs and expenses of preparation of the
Loan Documents and any consents, amendments, waivers, or other modifications
thereto; (b) the reasonable fees, expenses, and disbursements of counsel to the
Agent in connection with the negotiation, preparation, execution, and
administration of the Loan Documents and any consents, amendments, waivers, or
other modifications thereto and any other documents or matters requested by the
Borrower or any Guarantor; (c) all other actual and reasonable out-of-pocket
costs and expenses incurred by the Agent in connection with the establishment of
the Facility, the syndication of the Commitments and the negotiation,
preparation, and execution of the Loan Documents and any consents, amendments,
waivers, or other modifications thereto and the transactions contemplated
thereby; and (d) all reasonable out-of-pocket expenses (including reasonable
attorneys' fees and costs, which attorneys may be employees of the Agent or any
Lender and the fees and costs of appraisers, brokers, investment bankers or
other experts retained by the Agent or any Lender) incurred by the Agent or any
Lender in connection with (i) the enforcement of or preservation of rights under
any of the Loan Documents against the Borrower, the Guarantors or any other
Person, or the administration thereof, (ii) any refinancing or restructuring of
the credit arrangements provided under this Agreement in the nature of a
"WORK-OUT" or pursuant to any insolvency or bankruptcy proceedings, and (iii)
any litigation, proceeding or dispute whether arising hereunder or otherwise, in
any way related to the Agent's or any Lender's relationship with the Borrower,
except to the extent arising out of the Agent's or any Lender's bad faith, gross
negligence, willful misconduct or material breach of this Agreement or any other
Loan Document, as finally determined by a court of competent jurisdiction. The
covenants of this Section shall survive payment or satisfaction of payment of
amounts owing with respect to the Notes. The amount of all such expenses shall,
until paid, bear interest at the rate applicable to principal hereunder
(including the Default Rate) and be an Obligation secured by any Collateral.
7.25 INDEMNIFICATION. The Borrower shall indemnify and hold harmless the
Agent and the Lenders and all those claiming by, through or under the Agent and
each of the Lenders ("Indemnified Party") from and against any and all claims,
actions and suits whether groundless or otherwise, and from and against any and
all liabilities, losses, damages and expenses of every nature and character
arising out of this Agreement or any of the other Loan Documents or the
transactions contemplated hereby ("Damages") including, without limitation (a)
any actual or proposed use by the Borrower or any of its Subsidiaries of the
proceeds of any of the Loans, (b) the Borrower or any of its Subsidiaries
entering into or performing this Agreement or any of the other Loan Documents,
or (c) with respect to the Borrower and its Subsidiaries and their respective
properties and assets, the violation of any Legal Requirement, in each case
including, without limitation, the reasonable fees and disbursements of counsel
and allocated costs of internal counsel incurred in connection with any such
investigation, litigation or other proceeding; provided, however, that no
Indemnified Party shall be entitled to indemnification if a court of competent
jurisdiction finally determines (all appeals having been exhausted or waived)
that such Indemnified Party acted in bad faith, with willful misconduct, gross
negligence, or material breach of this Agreement or any other Loan Document. No
25
Indemnified Party shall be entitled to settle or enter into any accommodation in
respect of any such claim, action or suit without the prior written consent of
the Borrower (and that any Indemnified Party so settling or accommodating
without the Borrower's consent shall not be entitled to indemnification
therefor), and PROVIDED, HOWEVER, if the Borrower shall refuse to provide its
written consent to a requested settlement, the Borrower shall, as collateral for
potential payment of the full amount of the claimed Damages, provide either a
letter of credit in favor of the Indemnified Party, on terms and conditions
satisfactory to the Agent, in its sole discretion, or, as cash collateral, cash
or Cash Equivalents, any of which shall be in the full amount of the claimed
Damages, together with all anticipated costs and expenses (including reasonable
attorneys' fees and expenses) anticipated by the Agent, in its sole discretion,
to accrue in connection with the defense and possible payment of the claimed
Damages. If the Borrower fails to provide such required collateral, or fails to
respond to a request for a consent to a settlement, within five (5) Business
Days of when first requested by the Agent, the Indemnified Party shall be
entitled to settle the claim as it proposed, and the Borrower shall be liable
for the full amount thereof together with all related Damages. In litigation, or
the preparation therefor, the Lenders and the Agent shall be entitled to select
their own counsel and, in addition to the foregoing indemnity, the Borrower
agree to pay promptly the reasonable fees and expenses of such counsel. If, and
to the extent that the obligations of the Borrower under this Section 7.25 are
unenforceable for any reason, the Borrower hereby agrees to make the maximum
contribution to the payment in satisfaction of such obligations which is
permissible under applicable law. The provisions of this Section 7.25 shall
survive the repayment of the Loan and all other Obligations and the termination
of the Warehousing Commitment and any other obligations of the Lenders and the
Agent hereunder.
7.26 FINANCIAL COVENANTS.
-------------------
7.26.1 TANGIBLE NET WORTH. The Borrower shall, on a non-consolidated
basis, maintain a Tangible Net Worth of not less than the greater of (x)
$22,000,000.00 or (y) an amount sufficient to satisfy the requirements from time
to time of both ▇▇▇▇▇▇ ▇▇▇ and ▇▇▇▇▇▇▇ Mac, to be tested as of the Closing Date
and on the last day of each calendar quarter thereafter.
7.26.2 LIQUIDITY. The Borrower shall, on a non-consolidated basis, at
all times maintain unrestricted cash and Cash Equivalents of no less than
$500,000 plus 0.10% of the aggregate outstanding principal amount of the
aggregate of Serviced Loans serviced on behalf of ▇▇▇▇▇▇ Mae, or such higher
level as ▇▇▇▇▇▇ ▇▇▇ may require from time to time.
7.26.3 DEBT SERVICE COVERAGE. The Borrower shall, on a
non-consolidated basis, maintain a minimum Debt Service Coverage Ratio of 1.0:1,
which shall be tested quarterly on a rolling 4 quarter basis commencing as of
December 31, 2004 and continuing through and including, if applicable, March 31,
2006, and for each fiscal quarter thereafter, if applicable, commencing with the
quarter ending on June 30, 2006, the Borrower shall, on a non-consolidated
basis, maintain a minimum Debt Service Coverage Ratio of 1.25:1, which shall be
tested quarterly on a rolling 4 quarter basis.
7.26.4 MINIMUM PORTFOLIO AMOUNT. At no time shall the aggregate
principal balances of the Serviced Loans (exclusive of Serviced Loans which are
sixty (60) or more days past due or are otherwise in default) be less than
$2,800,000,000.
7.26.5 MAXIMUM SERVICED LOANS DELINQUENCIES. At no time shall the
aggregate principal amount of Serviced Loans which are sixty (60) or more days
past due or otherwise in default exceed 1% of aggregate principal balances of
all Serviced Loans.
7.27 REPLACEMENT DOCUMENTATION. Upon receipt of an affidavit of an officer
of Agent as to the loss, theft, destruction or mutilation of any Note, this
Agreement, any Loan Document, or any other security document which is not of
public record, and customary (unsecured, unbonded) indemnification reasonably
satisfactory to the Borrower, the Borrower will issue, in lieu thereof, a
replacement Note, Agreement, Loan Document or other security document in the
same principal amount thereof and otherwise of like tenor.
7.28 ADDITIONAL FACILITIES CO-TERMINOUS AND CROSS DEFAULTED. The Borrower
acknowledges and agrees that the occurrence of an event of default under the
Acquisition Facility shall constitute an Event of Default hereunder.
26
7.29 PLEDGE OF SERVICING CONTRACTS. The Borrower shall not Pledge or grant
a security interest in any existing or future Servicing Contracts of the
Borrower other than to Agent.
7.30 RECOURSE SERVICING CONTRACTS. The Borrower will not acquire or enter
into Servicing Contracts under which the Borrower must repurchase or indemnify
the holder of the Mortgage Loans as a result of defaults on the Mortgage Loans
at any time during the term of those Mortgage Loans, except for loss sharing
under ▇▇▇▇▇▇ ▇▇▇ DUS Mortgage Loans and as a result of customary representations
and warranties consistent with past practices in the ordinary course of the
Borrower's business concerning the Mortgage Loans.
7.31 GESTATION AGREEMENTS. The Borrower shall not directly or indirectly
sell or finance a Mortgage Loan under any Gestation Agreement if the Mortgage
Loan is or was previously pledged to the Agent as Collateral under this
Agreement.
7.32 NO SUBSIDIARIES.
---------------
Notwithstanding references to the Borrower's Subsidiaries throughout this
Agreement, the Borrower hereby represents and warrants that it does not have any
Subsidiaries as of the date of this Agreement. The Borrower hereby covenants and
agrees that it shall not create, obtain, acquire, suffer to exist or otherwise
have any Subsidiaries, without the Agent's prior written consent (which consent
may be withheld in the Agent's unrestricted discretion).
8. SPECIAL REPRESENTATIONS, WARRANTIES AND COVENANTS CONCERNING COLLATERAL
-----------------------------------------------------------------------
8.1 SPECIAL REPRESENTATIONS AND WARRANTIES CONCERNING ELIGIBILITY AS
SELLER/SERVICER OF MORTGAGE LOANS
The Borrower represents and warrants to Agent and the Lenders, as of the
date of this Agreement and as of the date of each Warehousing Advance Request
and the making of each Warehousing Advance, that the Borrower is approved and
qualified and in good standing as a lender or seller/servicer, as set forth
below, and meets all requirements applicable to its status as:
8.1.1 The Borrower is a FHA approved mortgagee, eligible to originate,
purchase, hold, sell and service FHA fully insured Mortgage Loans.
8.1.2 The Borrower is a ▇▇▇▇▇▇ Mae approved seller/servicer of
Mortgage Loans and issuer of Mortgage-backed Securities guaranteed by ▇▇▇▇▇▇
▇▇▇.
8.1.3 The Borrower is a ▇▇▇▇▇▇ Mae approved seller/servicer of
Mortgage Loans, eligible to originate, purchase, hold, sell and service Mortgage
Loans to be sold to ▇▇▇▇▇▇ ▇▇▇.
8.1.4 The Borrower is a ▇▇▇▇▇▇ Mae approved and qualified Delegated
Underwriting and Servicing Lender, eligible to process, underwrite, hold, sell
to ▇▇▇▇▇▇ ▇▇▇ and service ▇▇▇▇▇▇ Mae Mortgage Loans under the DUS Program.
8.1.5 The Borrower is a ▇▇▇▇▇▇▇ Mac approved seller/servicer of
Mortgage Loans, eligible to originate, purchase, hold, sell and service Mortgage
Loans to be sold to ▇▇▇▇▇▇▇ Mac.
8.2 SPECIAL REPRESENTATIONS AND WARRANTIES CONCERNING WAREHOUSING
COLLATERAL
The Borrower represents and warrants to Agent and the Lenders, as of the
date of this Agreement and as of the date of each Warehousing Advance Request
and the making of each Warehousing Advance, that:
8.2.1 The Borrower has not selected the Collateral in a manner so as
to affect adversely Lender's interests.
27
8.2.2 The Borrower is the legal and equitable owner and holder, free
and clear of all Liens (other than Liens granted under this Agreement), of the
Pledged Assets. All Pledged Assets and related Purchase Commitments have been
duly authorized and validly issued to the Borrower, and all of the foregoing
items of Collateral comply with all of the requirements of this Agreement, and
have been and will continue to be validly pledged or assigned to Lender, subject
to no other Liens.
8.2.3 The Borrower has, and will continue to have, the full right,
power and authority to pledge the Collateral pledged and to be pledged by it
under this Agreement.
8.2.4 Each Mortgage Loan and each related document included in the
Pledged Loans (1) has been duly executed and delivered by the parties to that
Mortgage Loan and that related document, (2) has been made in compliance with
all applicable laws, rules and regulations (including all laws, rules and
regulations relating to usury), (3) is and will continue to be a legal, valid
and binding obligation, enforceable in accordance with its terms, without
setoff, counterclaim or defense in favor of the mortgagor under the Mortgage
Loan or any other obligor on the Mortgage Note and (4) has not been modified,
amended or any requirements of which waived, except in a writing that is part of
the Collateral Documents. No party to any Mortgage Loan or related document is
in violation of any applicable law, rule or regulation if the violation would
impair the collectibility of the Mortgage Loan or the performance by the
mortgagor or any other obligor of its obligations under the Mortgage Note or any
related document.
8.2.5 Each Pledged Loan is secured by a Mortgage on real property
located in one of the states of the United States or the District of Columbia.
8.2.6 Unless Third Party Originated Loans are permitted, each Pledged
Loan has been closed or will be closed and funded with the Warehousing Advance
made against it.
8.2.7 Each Pledged Loan that is not an FHA Construction Mortgage Loan
has been fully advanced in the face amount of its Mortgage Note. The Agent
acknowledges and agrees that in certain instances, a portion of the proceeds of
a Pledged Loan, although advanced to the borrower thereunder, will be held by
the Borrower in escrow to be disbursed upon the completion of repairs to the
subject property.
8.2.8 Each First Mortgage is a first Lien on the premises described in
that Mortgage and each Second Mortgage Loan or a Third Mortgage Loan is secured
by a second or third Lien on the premises described in that Mortgage, and with
respect to each Second Mortgage Loan or Third Mortgage Loan, the Borrower shall
be the servicer, and the Purchase Commitment shall be from the same Investor
which holds the senior Lien on the Property and Third Mortgage Loans shall only
be ▇▇▇▇▇▇ ▇▇▇ Mortgage Loans. Each Pledged Loan has or will have a title
insurance policy, in ALTA form or equivalent, from a recognized title insurance
company, insuring the priority of the Lien of the Mortgage and meeting the usual
requirements of Investors purchasing those Mortgage Loans.
8.2.9 Each Property has been evaluated or appraised in accordance with
Title XI of FIRREA, to the extent required.
8.2.10 The Mortgage Note for each Pledged Loan is (1) payable or
endorsed to the order of the Borrower, (2) an "instrument' within the meaning of
Section 9-102 of the Uniform Commercial Code of all applicable jurisdictions and
(3) is denominated and payable in United States dollars.
8.2.11 No default has existed for 60 days or more under any Mortgage
Loan included in the Pledged Loans.
8.2.12 The Borrower has complied and will continue to comply with all
laws, rules and regulations in respect of the FHA insurance of each Mortgage
Loan included in the Pledged Mortgages designated by the Borrower as an FHA
insured or VA guaranteed Mortgage Loan, and such insurance or guarantee is and
will continue to be in full force and effect.
28
8.2.13 All fire and casualty policies covering the premises encumbered
by each Mortgage included in the Pledged Loans (1) name and will continue to
name the Borrower and its successors and assigns as the insured under a standard
mortgagee clause, (2) are and will continue to be in full force and effect and
(3) afford and will continue to afford insurance against fire and such other
risks as are usually insured against in the broadest form of extended coverage
insurance available.
8.2.14 Pledged Loans secured by premises located in a special flood
hazard area designated as such by the Director of the Federal Emergency
Management Agency are and will continue to be covered by special flood insurance
under the National Flood Insurance Program.
8.2.15 Each Pledged Loan against which a Warehousing Advance is made
on the basis of a Purchase Commitment meets all of the requirements of that
Purchase Commitment, and each Pledged Security against which a Warehousing
Advance is outstanding meets all of the requirements of the related Purchase
Commitment.
8.2.16 Pledged Loans that are intended to be exchanged for Agency
Securities comply or, prior to the issuance of the Agency Securities will
comply, with the requirements of any governmental instrumentality, department or
agency or any other Person issuing or guaranteeing the Agency Securities.
8.2.17 Pledged Loans that are intended to be used in the formation of
Mortgage-backed Securities (other than Agency Securities) comply with the
requirements of the issuer of the Mortgage-backed Securities (or its sponsor)
and of the Rating Agencies.
8.2.18 None of the Pledged Loans is a graduated payment Mortgage Loan
or has a shared appreciation or other contingent interest feature, and each
Pledged Loan provides for periodic payments of all accrued interest on the
Mortgage Loan on at least a monthly basis.
8.2.19 The Borrower has no ownership interest, right to acquire any
ownership interest or equivalent economic interest in any property securing a
Mortgage Loan or the mortgagor under the Mortgage Loan or any other obligor on,
or guarantor of, the Mortgage Note.
8.2.20 The original assignments of Mortgage and of UCC financing
statements delivered to the Agent for each Pledged Loan are in recordable form
and comply with all applicable laws and regulations governing the filing and
recording of such documents.
8.2.21 Each Pledged Loan secured by real property to which a
manufactured home is affixed will create a valid Lien on that manufactured home
that will have priority over any other Lien on the manufactured home, whether or
not arising under applicable real property law or the UCC or other applicable
law.
8.3 SPECIAL AFFIRMATIVE COVENANTS CONCERNING WAREHOUSING COLLATERAL
---------------------------------------------------------------
As long as the Warehousing Commitment is outstanding or there remain any
Obligations to be paid or performed under this Agreement or under any other Loan
Document, the Borrower must:
8.3.1 Warrant and defend the right, title and interest of the Agent
and the Lenders in and to the Collateral against the claims and demands of all
Persons.
8.3.2 Service or cause to be serviced all Pledged Loans in accordance
with the standard requirements of the issuers of Purchase Commitments covering
them and all applicable HUD, ▇▇▇▇▇▇ ▇▇▇ and ▇▇▇▇▇▇▇ Mac requirements, including
taking all actions necessary to enforce the obligations of the obligors under
such Mortgage Loans; and must service or cause to be serviced all Mortgage Loans
backing Pledged Securities in accordance with applicable governmental
requirements and requirements of issuers of Purchase Commitments covering them.
29
8.3.3 Execute and deliver to Agent and/or the Lenders such further
instruments of sale, pledge, assignment or transfer, and those powers of
attorney, as required by Agent, and do and perform all matters and things
necessary or desirable to be done or observed, for the purpose of effectively
creating, maintaining and preserving the security and benefits intended to be
afforded Agent (for the ratable benefit of the Lenders) under this Agreement.
8.3.4 Notify Agent within 2 Business Days of any default under, or of
the termination of, any Purchase Commitment relating to any Pledged Loan,
Eligible Mortgage Pool, or Pledged Security.
8.3.5 Promptly comply in all respects with the terms and conditions of
all Purchase Commitments, and all extensions, renewals and modifications or
substitutions of or to all Purchase Commitments. Deliver or cause to be
delivered to the Investor the Pledged Loans and Pledged Securities to be sold
under each Purchase Commitment not later than the mandatory delivery date of the
Pledged Loans or Pledged Securities under the Purchase Commitment.
8.3.6 Maintain, at its principal office or in a regional office
approved by Agent, or in the office of a computer service bureau engaged by
Borrower and approved by Agent and, upon request, make available to Agent the
originals, or copies in any case where the originals have been delivered to
Agent or to an Investor, of the Mortgage Notes and Mortgages included in Pledged
Loans, Mortgage-backed Securities delivered to Agent as Pledged Securities,
Purchase Commitments, and all related Mortgage Loan documents and instruments,
and all files, surveys, certificates, correspondence, appraisals, computer
programs, tapes, discs, cards, accounting records and other information and data
relating to the Collateral.
8.3.7 Be in good standing with ▇▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇ Mac, ▇▇▇▇▇▇ ▇▇▇,
and FHA with respect to all programs and products in which the Borrower from
time to time is participating.
8.4 SPECIAL NEGATIVE COVENANTS CONCERNING WAREHOUSING COLLATERAL
------------------------------------------------------------
As long as the Warehousing Commitment is outstanding or there remain any
Obligations to be paid or performed, the Borrower must not, either directly or
indirectly, without the prior written consent of the Agent and the Requisite
Lenders:
8.4.1 Amend or modify, or waive any of the terms and conditions of, or
settle or compromise any claim in respect of, any Pledged Assets.
8.4.2 Sell, transfer or assign, or grant any option with respect to,
or pledge (except under this Agreement) any of the Collateral or any interest in
any of the Collateral.
8.4.3 Make any compromise, adjustment or settlement in respect of any
of the Collateral or accept other than cash in payment or liquidation of the
Collateral.
8.5 SPECIAL REPRESENTATION AND WARRANTY CONCERNING ▇▇▇▇▇▇ ▇▇▇ DUS PROGRAM
RESERVE REQUIREMENTS
The Borrower represents and warrants to Agent and the Lenders, as of the
date of this Agreement and as of the date of each Warehousing Advance Request
and the making of each Warehousing Advance, that it has met the ▇▇▇▇▇▇ Mae DUS
Program requirements for lender reserves for each ▇▇▇▇▇▇ ▇▇▇ DUS Mortgage Loan
to be funded by such Warehousing Advance.
8.6 SPECIAL REPRESENTATIONS AND WARRANTIES CONCERNING FHA PROJECT MORTGAGE
LOANS
The Borrower represents and warrants to Agent and the Lenders, as of the
date of this Agreement and as of the date of each Warehousing Advance Request
and the making of each Warehousing Advance, that:
30
8.6.1 Each FHA-insured Mortgage Loan included in the Pledged Loans
meets all applicable Legal Requirements and any other governmental requirements
for such insurance. The Borrower has complied and will continue to comply with
all laws, rules and regulations with respect to the FHA insurance of each
Pledged Loan designated by the Borrower as an FHA-insured Mortgage Loan, and
such insurance is and will continue to be in full force and effect.
8.6.2 For FHA-insured Pledged Loans that will be used to back ▇▇▇▇▇▇
Mae Mortgage-backed Securities, the Borrower received from ▇▇▇▇▇▇ ▇▇▇
confirmation notices for additional commitment authority and pool numbers, and
there remains available under those agreements a commitment on the part of
▇▇▇▇▇▇ Mae sufficient to permit the issuance of ▇▇▇▇▇▇ ▇▇▇ Mortgage-backed
Securities in an amount at least equal to the amount of the Pledged Loans
designated by the Borrower as the Mortgage Loans to be used to back those ▇▇▇▇▇▇
Mae Mortgage-backed Securities; each of those confirmation notices is in full
force and effect; each of those Pledged Loans has been assigned by the Borrower
to one of those pool numbers and a portion of the available ▇▇▇▇▇▇ ▇▇▇
commitment has been allocated to this Agreement by the Borrower, in an amount at
least equal to those Pledged Loans; and each of those assignments and
allocations has been reflected in the books and records of the Borrower.
8.7 SPECIAL REPRESENTATIONS AND WARRANTIES CONCERNING SERVICING COLLATERAL
----------------------------------------------------------------------
SCHEDULE 6.20 is a true and complete list of the Borrower's Servicing
Portfolio as of the date set forth therein. The Borrower hereby represents and
warrants to Agent and the Lenders, as of the date of this Agreement and as of
the date of each Warehousing Advance Request and the making of each Warehousing
Advance, that:
8.7.1 The Borrower is the legal and equitable owner and holder, free
and clear of all Liens of the Servicing Contracts.
8.7.2 Except as otherwise disclosed to the Agent and the Lenders, all
of the Borrower's servicing rights under the Servicing Contracts constitute
primary servicing rights.
8.7.3 Each Servicing Contract is in full force and effect and is
legal, valid and enforceable in accordance with its terms, and no default or
event that, with notice or lapse of time or both, would become a default, exists
under any Servicing Contract, except where the failure of the foregoing would
not materially adversely affect the Borrower's business or assets.
8.7.4 Each right to the payment of money under the Servicing Contracts
is genuine and enforceable in accordance with its terms against the parties
obligated to pay the same, which terms have not been modified or waived in any
respect or to any extent, except where the failure of the foregoing would
materially adversely affect the Borrower's business or assets.
8.7.5 To the best of the Borrower's knowledge, no obligor has any
defense, set off, claim or counterclaim against the Borrower that can be
asserted against Agent or any Lender, whether in any proceeding to enforce
Agent's rights in the related Mortgage Loan or otherwise, except where the
failure of the foregoing would not materially adversely affect the Borrower's
business or assets.
9. EVENTS OF DEFAULT. The following provisions deal with Default, Events of
Default, notice, grace and cure periods, and certain rights of Agent and the
Lenders following an Event of Default.
9.1 DEFAULT AND EVENTS OF DEFAULT. The term "Default" as used herein or in
any of the other Loan Documents shall mean an Event of Default, or any fact or
circumstance which constitutes, or upon the lapse of time, or giving of notice,
or both, would constitute, an Event of Default. Each of the following events,
unless cured within any applicable grace period set forth or referred to below
in this Section 9.1, shall constitute an "Event of Default".
9.1.1 FAILURE TO PAY. The Borrower shall fail to pay any principal and
interest of the Loan or any other Obligation when the same shall become due and
payable, whether at the stated date of maturity or any accelerated date of
maturity or at any other date fixed for payment;
31
9.1.2 FAILURE TO PERFORM (GRACE). The Borrower shall fail
(i) to comply with the covenants set forth in Sections 7.11, 7.24
and 7.25 within ten (10) days from the date of the Agent's written notice
to the Borrower informing the Borrower of the Borrower's failure to have so
complied with said covenants; and
(ii) to comply with the covenants set forth in Sections 7.3,
7.6.1(b), 7.7, 7.8, 7.9, 7.13(a), 7.23.1 and 7.23.2, and 7.27 within
fifteen (15) days from the date of the Agent's written notice to the
Borrower informing the Borrower of the Borrower's failure to have so
complied with said covenants; and
(iii) to comply with the provisions of clauses (a) through (f)
inclusive of Section 7.14.2 with respect to any lien not resulting from a
voluntary action by the Borrower within five (5) days from the date of the
Agent's written notice to the Borrower informing the Borrower of the
Borrower's failure to have so complied with said covenant;
PROVIDED, HOWEVER, that the foregoing grace periods shall only apply in respect
of the first instance of non-compliance with each respective covenant in any
twelve-month period.
9.1.3 FAILURE TO PERFORM. The Borrower shall fail to comply with any
of its covenants contained herein or any of the covenants contained in any other
Loan Documents and which are not referenced in Section 9.1.2 above;
9.1.4 BREACH OF REPRESENTATION OR WARRANTY. Any representation or
warranty of the Borrower or any of its Subsidiaries in this Agreement or any of
the other Loan Documents shall have been false in any material respect upon the
date when made or deemed to have been made or repeated;
9.1.5 FAILURE TO PAY OTHER INDEBTEDNESS. The Borrower or any of its
Subsidiaries shall fail to pay at maturity, or within any applicable period of
grace, any obligation in excess of $50,000 for borrowed money or credit received
or in respect of any capitalized leases, or fail to observe or perform any term,
covenant or agreement contained in any agreement by which it is bound,
evidencing or securing borrowed money or credit received or in respect of any
capitalized leases in excess of $50,000 provided that the holder or holders
thereof or of any obligations issued thereunder are entitled to accelerate the
maturity thereof;
9.1.6 INSOLVENCY. The Borrower or any of its Subsidiaries shall make
an assignment for the benefit of creditors, or admit in writing its inability to
pay or generally fail to pay its debts as they mature or become due, or shall
petition or apply for the appointment of a trustee or other custodian,
liquidator or receiver of the Borrower or any of its Subsidiaries or of any
substantial part of the assets of the Borrower or any of its Subsidiaries or
shall commence any case or other proceeding relating to the Borrower or any of
its Subsidiaries under any bankruptcy, reorganization, arrangement, insolvency,
readjustment of debt, dissolution or liquidation or similar law of any
jurisdiction, now or hereafter in effect, or shall take any action to authorize
or in furtherance of any of the foregoing, or if any such petition or
application shall be filed or any such case or other proceeding shall be
commenced against the Borrower or any of its Subsidiaries and the Borrower or
any of its Subsidiaries shall indicate its approval thereof, consent thereto or
acquiescence therein;
9.1.7 INVOLUNTARY PROCEEDINGS. The filing of any case or other
proceeding against the Borrower or any of its Subsidiaries under any bankruptcy,
reorganization, arrangement, insolvency, readjustment of debt, dissolution or
liquidation or similar law of any jurisdiction, now or hereafter in effect and
such case or proceeding is not discharged or dismissed within forty-five (45)
days of its commencement; a decree or order is entered appointing any such
trustee, custodian, liquidator or receiver or adjudicating the Borrower or any
of its Subsidiaries bankrupt or insolvent, or approving a petition in any such
case or other proceeding, or a decree or order for relief is entered in respect
of the Borrower or any Subsidiary of the Borrower, in an involuntary case under
federal bankruptcy laws as now or hereafter constituted;
9.1.8 JUDGMENTS. There shall remain in force, undischarged,
unsatisfied and unstayed, for more than forty-five (45) days, whether or not
consecutive, any uninsured final judgment against the Borrower or any of its
32
Subsidiaries that, with other outstanding uninsured final judgments,
undischarged, against the Borrower or any of its Subsidiaries exceeds in the
aggregate $100,000;
9.1.9 CANCELLATION OF LOAN DOCUMENTS. If any of the Loan Documents
shall be canceled, terminated, revoked or rescinded or any action at law, suit
or in equity or other legal proceeding to cancel, revoke or rescind any of the
Loan Documents shall be commenced by or on behalf of the Borrower or any of its
Subsidiaries, or any court or any other governmental or regulatory authority or
agency of competent jurisdiction shall make a determination that, or issue a
judgment, order, decree or ruling to the effect that, any one or more of the
Loan Documents is illegal, invalid or unenforceable in accordance with the terms
thereof;
9.1.10 ERISA. With respect to any ERISA Plan, a Reportable Event shall
have occurred and (i) a trustee shall have been appointed by the United States
District Court to administer such plan; (ii) proceedings shall have been
instituted to terminate such plan (which termination proceedings could result in
liability of the Borrower or any of its Subsidiaries to the PBGC and/or others
in excess of $250,000; or (iii) facts and circumstances exist with respect to
such plan that could result in liability of the Borrower or any of its
Subsidiaries in excess of $250,000.
9.1.11 INDICTMENT. The Borrower or any of its Subsidiaries shall be
indicted for a federal crime, a punishment for which could include the
forfeiture of any assets of the Borrower or such Subsidiaries;
9.1.12 MATERIAL ADVERSE CHANGE. There shall have occurred any change
in or to the assets, liabilities, financial condition, business operations, or
prospects of the Borrower and its Subsidiaries, taken as a whole, which change
materially adversely affects the Borrower's ability to perform its obligations
under this Agreement or the other Loan Documents;
9.1.13 REGARDING GUARANTOR, ET. AL. The occurrence of any of the
foregoing Events of Default with respect to any Guarantor of the Obligations, or
the occurrence of any of the foregoing Events of Default with respect to the
parent of the Borrower, or any of the Guarantor's Subsidiaries or Affiliates, as
if such Guarantor, parent, or Affiliate were the "Borrower" described therein;
9.1.14 CHANGE IN CONTROL. Any change of the ownership of the capital
stock of the Borrower from that existing on the date hereof, except as permitted
pursuant to Section 7.18.4, or a Change in Control shall have occurred with
respect to CharterMac; or
9.1.15 FLEET FINANCINGS. The occurrence of an event of default
(however defined or described) under any other Fleet Financing.
9.2 WRITTEN WAIVERS. If a Default is waived by the Requisite Lenders (or
all of the Lenders if and to the extent required by the terms of Section 11.4
hereof), in their sole discretion, pursuant to a specific written instrument
executed by an authorized officer of Agent, the Default so waived shall be
deemed to have never occurred.
9.3 REMEDIES.
--------
9.3.1 If an Event of Default described in Section 9.1.6 and 9.1.7
occurs with respect to the Borrower, the Warehousing Commitment will
automatically terminate and the unpaid principal amount of and accrued interest
on the Loan and all other Obligations will automatically become due and payable,
without presentment, demand or other requirements of any kind, all of which the
Borrower expressly waives.
9.3.2 If any other Event of Default occurs and is continuing, Agent
may, and with the direction of the Requisite Lenders shall, by Notice to the
Borrower, terminate the Warehousing Commitment and declare the Obligations to be
immediately due and payable.
9.3.3 If any Event of Default occurs and is continuing, Agent may also
take any of the following actions:
33
(i) Foreclose upon or otherwise enforce its security interest in
and Lien on the Collateral to secure all payments and performance of the
Obligations in any manner permitted by law or provided for in the Loan
Documents.
(ii) Notify all obligors under any of the Collateral that the
Collateral has been assigned to Agent (or to another Person designated by
Agent) and that all payments on that Collateral are to be made directly to
Agent (or such other Person); settle, compromise or release, in whole or in
part, any amounts any obligor or Investor owes on any of the Collateral on
terms acceptable to Agent; enforce payment and prosecute any action or
proceeding involving any of the Collateral; and where any Collateral is in
default, foreclose on and enforce any Liens securing that Collateral in any
manner permitted by law and sell any property acquired as a result of those
enforcement actions.
(iii) Act, or contract with a third party to act at the
Borrower's expense, as servicer or subservicer of Collateral requiring
servicing and perform all obligations required under any Servicing
Contracts and Purchase Commitments.
(iv) Require the Borrower to assemble and make available to Agent
the Collateral and all related books and records at a place designated by
Agent.
(v) Enter onto property where any Collateral or related books and
records are located and take possession of those items with or without
judicial process; and obtain access to the Borrower's data processing
equipment, computer hardware and software relating to the Collateral and
use all of the foregoing and the information contained in the foregoing in
any manner Agent deems necessary for the purpose of effectuating its rights
under this Agreement and any other Loan Document.
(vi) Before the disposition of the Collateral, prepare it for
disposition in any manner and to the extent Agent deems appropriate.
(vii) Exercise all rights and remedies of a secured creditor
under the UCC or other applicable law, including selling or otherwise
disposing of all or any portion of the Collateral at one or more public or
private sales, whether or not the Collateral is present at the place of
sale, for cash or credit or future delivery, on the terms and in the manner
as Agent may determine, including sale under any applicable Purchase
Commitment. The Borrower waives any right the Borrower may have to prior
notice of the sale of all or any portion of the Collateral to the extent
allowed by applicable law. If notice is required under applicable law,
Agent will give the Borrower not less than 10 days' notice of any public
sale or of the date after which any private sale may be held. The Borrower
agrees that 10 days' notice is reasonable notice. Agent may, without notice
or publication, adjourn any public or private sale one or more times by
announcement at the time and place fixed for the sale, and the sale may be
held at any time or place announced at the adjournment. In the case of a
sale of all or any portion of the Collateral on credit or for future
delivery, the Collateral sold on those terms may be may be retained by
Agent until the purchaser pays the selling price or takes possession of the
Collateral. Agent has no liability to the Borrower if a purchaser fails to
pay for or take possession of the Collateral sold on those terms, and in
the case of any such failure, Agent may sell the Collateral again upon
notice complying with this Section.
(viii) Instead of or in conjunction with exercising the power of
sale authorized by Section 9.5.3(vii), Agent may proceed by suit at law or
in equity to collect all amounts due upon the Collateral, or to foreclose
Agent's Lien on and sell all or any portion of the Collateral pursuant to a
judgment or decree of a court of competent jurisdiction.
(ix) Proceed against the Borrower on the Notes.
(x) Retain all excess proceeds from the sale or other disposition
of the Collateral, and apply them to the payment of the Obligations under
Section 11.2.4.
34
9.3.4 Agent and Lenders will incur no liability as a result of the
commercially reasonable sale or other disposition of all or any portion of the
Collateral at any public or private sale or other disposition. The Borrower
waives (to the extent permitted by law) any claims it may have against Agent
arising by reason of the fact that the price at which the Collateral may have
been sold at a private sale was less than the price that Agent might have
obtained at a public sale, or was less than the aggregate amount of the
outstanding Warehousing Advances, plus accrued and unpaid interest on the
Advances, and unpaid fees, even if Agent accepts the first offer received and
does not offer the Collateral to more than one offeree. The Borrower agrees that
any sale of Collateral under the terms of a Purchase Commitment, or any other
disposition of Collateral arranged by the Borrower, whether before or after the
occurrence of an Event of Default, will be deemed to have been made in a
commercially reasonable manner.
9.3.5 The Borrower acknowledges that Mortgage Loans are collateral of
a type that is the subject of widely distributed standard price quotations and
that Mortgage-backed Securities are collateral of a type that is customarily
sold on a recognized market. The Borrower waives any right it may have to prior
notice of the sale of Pledged Securities, and agrees that Agent may purchase
Pledged Loans and Pledged Securities at a private sale of such Collateral.
9.3.6 The Borrower specifically waives and releases (to the extent
permitted by law) any equity or right of redemption, stay or appraisal that the
Borrower has or may have under any rule of law or statute now existing or
adopted after the date of this Agreement, and any right to require Agent to (1)
proceed against any Person, (2) proceed against or exhaust any of the Collateral
or pursue its rights and remedies against the Collateral in any particular
order, or (3) pursue any other remedy within its power. Agent is not required to
take any action to preserve any rights of the Borrower against holders of
mortgages having priority to the Lien of any Mortgage included in the Collateral
or to preserve the Borrower's rights against other prior parties.
9.3.7 Lenders may, but are not obligated to, advance any sums or do
any act or thing necessary to uphold or enforce the Lien and priority of, or the
security intended to be afforded by, any Mortgage included in the Collateral,
including payment of delinquent taxes or assessments and insurance premiums. All
advances, charges, costs and expenses, including reasonable attorneys' fees and
disbursements, incurred or paid by Agent or Lenders in exercising any right,
power or remedy conferred by this Agreement, or in the enforcement of this
Agreement, together with interest on those amounts at the Default Rate, from the
time paid by Agent or Lenders until repaid by the Borrower, are deemed to be
principal outstanding under this Agreement and the Notes.
9.3.8 No failure or delay on the part of Agent to exercise any right,
power or remedy provided in this Agreement or under any other Loan Document, at
law or in equity, will operate as a waiver of that right, power or remedy. No
single or partial exercise by Agent of any right, power or remedy provided under
this Agreement or any other Loan Document, at law or in equity, precludes any
other or further exercise of that right, power, or remedy by Agent, or Agent's
exercise of any other right, power or remedy. Without limiting the foregoing,
the Borrower waives all defenses based on the statute of limitations to the
extent permitted by law. The remedies provided in this Agreement and the other
Loan Documents are cumulative and are not exclusive of any remedies provided at
law or in equity.
9.3.9 For the purpose of exercising the rights granted by this Section
9, as well as any and all other rights and remedies of Agent, the Borrower
hereby irrevocably constitutes and appoints Agent (or any agent designated by
any Lender) its true and lawful attorney-in-fact, with full power of
substitution, exercisable upon and following any Event of Default, to execute,
acknowledge and deliver any instruments and to do and perform any acts in the
name and on behalf of the Borrower, including, without limitation, Agent has
been granted a license or other right to use, without charge, the Borrower's
computer programs, other programs, labels, patents, copyrights, rights of use of
any name, trade secrets, trade names, trademarks, service marks and advertising
matter, or any property of a similar nature, as it pertains to the Collateral,
in advertising for sale and selling any Collateral and the Borrower's rights
under all licenses and all other agreements related to the foregoing inure to
Agent's benefit until the Obligations are paid in full.
10. SECURITY INTEREST AND SET-OFF.
-----------------------------
35
10.1 SECURITY INTEREST. The Borrower hereby grants to the Agent and each of
the Lenders, a lien, security interest and right of setoff as security for all
liabilities and obligations to Agent and each of the Lenders, whether now
existing or hereafter arising, upon and against all deposits, credits,
collateral and property of the Borrower, now or hereafter in the possession,
custody, safekeeping or control of Agent or any of the Lenders or any entity
under the control of Bank of America Corporation and its successors and assigns
or in transit to any of them.
10.2 SET-OFF. If an Event of Default occurs and is continuing, any such
deposits, balances or other sums credited by or due from Agent or any of the
Lenders, or from any such Affiliate of Agent or any of the Lenders, to the
Borrower may to the fullest extent not prohibited by applicable law at any time
or from time to time, without regard to the existence, sufficiency or adequacy
of any other collateral, and without notice or compliance with any other
condition precedent now or hereafter imposed by statute, rule of law or
otherwise, all of which are hereby waived, be set off, appropriated and applied
by Agent or such Lender of Affiliate against any or all of the Borrower's
Obligations irrespective of whether demand shall have been made and although
such obligations may be unmatured, in such manner as Agent or such Lender or
Affiliate in its sole and absolute discretion may determine. Within five (5)
Business Days of making any such set off, appropriation or application, Agent
agrees to notify the Borrower thereof, provided the failure to give such notice
shall not affect the validity of such set off or appropriation or application.
ANY AND ALL RIGHTS TO REQUIRE AGENT TO EXERCISE ITS RIGHTS OR REMEDIES WITH
RESPECT TO ANY OTHER COLLATERAL WHICH SECURES THE LOAN, PRIOR TO EXERCISING ITS
RIGHT OF SETOFF WITH RESPECT TO SUCH DEPOSITS, CREDITS OR OTHER PROPERTY OF THE
BORROWER, ARE HEREBY KNOWINGLY, VOLUNTARILY AND IRREVOCABLY WAIVED. Each of the
Lenders agrees with each other Lender that (a) if an amount to be set off is to
be applied to indebtedness of the Borrower to such Lender, other than the
Obligations evidenced by the Note held by such Lender, unless such amount is
held by such Lender in connection with a specific relationship with the Borrower
other than that evidenced by the Loan Documents, such amount shall be applied
ratably to such other indebtedness and to the Obligations evidenced by the Note
held by such Lender, and (b) if such Lender shall receive from the Borrower,
whether by voluntary payment, exercise of the right of setoff, counterclaim,
cross action, enforcement of the claim evidenced by the Note held by such Lender
by proceedings against the Borrower at law or in equity or by proof thereof in
bankruptcy, reorganization, liquidation, receivership or similar proceedings, or
otherwise, and shall retain and apply to the payment of the Note held by such
Lender any amount in excess of its ratable portion of the payments received by
all of the Lenders with respect to the Note held by all of the Lenders, such
Lender will make such disposition and arrangements with the other Lenders with
respect to such excess, either by way of distribution, participation, pro tanto
assignment of claims, subrogation or otherwise as shall result in each Lender
receiving in respect of the Note held by it its proportionate payment as
contemplated by this Agreement; provided that if all or any part of such excess
payment is thereafter recovered from such Lender, such disposition and
arrangements shall be rescinded and the amount restored to the extent of such
recovery, but without interest.
10.3 RIGHT TO FREEZE. The Agent and each of the Lenders shall also have the
right, at its option, upon the occurrence of any event which would entitle the
Agent and each of the Lenders to set off or debit as set forth in Section 10.2,
to freeze, block or segregate any such deposits, balances and other sums so that
the Borrower may not access, control or draw upon the same.
10.4 ADDITIONAL RIGHTS. The rights of Agent, the Lenders, and each
affiliate of the Agent and the Lenders under this Section 10 are in addition to,
and not in limitation of, other rights and remedies, including other rights of
set off, which Agent or any of the Lenders may have.
11. THE AGENT AND THE LENDERS
-------------------------
11.1 RIGHTS, DUTIES AND IMMUNITIES OF THE AGENT.
------------------------------------------
11.1.1 APPOINTMENT OF AGENT. Each Lender hereby irrevocably designates
and appoints Fleet National Bank as Agent of such Lender to act as specified
herein and in the other Loan Documents, and each such Lender hereby irrevocably
authorizes the Agent to take such actions, exercise such powers and perform such
duties as are expressly delegated to or conferred upon the Agent by the terms of
this Agreement and the other Loan Documents, together with such other powers as
are reasonably incidental thereto. The Agent agrees to act as such upon the
express conditions contained in this Section 11. The Agent shall not have any
duties or responsibilities except those expressly set forth herein or in the
other Loan Documents, nor shall it have any fiduciary relationship with, or
36
fiduciary duty to, any Lender, and no implied covenants, responsibilities,
duties, obligations or liabilities shall be read into this Agreement or
otherwise exist against the Agent. The provisions of this Section 11 are solely
for the benefit of the Agent and the Lenders, and the Borrower shall not have
any rights as a third party beneficiary of any of the provisions hereof.
11.1.2 ADMINISTRATION OF LOAN BY AGENT. The Agent shall be responsible
for administering the Loan on a day-to-day basis. In the exercise of such
administrative duties, the Agent shall use the same diligence and standard of
care that is customarily used by the Agent with respect to similar loans held by
the Agent solely for its own account.
Each Lender delegates to the Agent the full right and authority on its
behalf to take the following specific actions in connection with its
administration of the Loan:
(i) to fund each Warehousing Advance in accordance with the
provisions of the Loan Documents, but only to the extent of immediately
available funds provided to the Agent by the respective Lenders for such
purpose;
(ii) to receive all payments of principal, interest, fees and
other charges paid by, or on behalf of, the Borrower and, except for fees
to which the Agent is entitled pursuant to the Loan Documents or otherwise,
to distribute all such funds to the respective Lenders as provided for
hereunder;
(iii) to keep and maintain complete and accurate files and
records of all material matters pertaining to the Loan, and make such files
and records available for inspection and copying by each Lender and its
respective employees and agents during normal business hours upon
reasonable prior notice to the Agent; and
(iv) to do or omit doing all such other actions as may be
reasonably necessary or incident to the implementation, administration and
servicing of the Loan and the rights and duties delegated hereinabove.
11.1.3 DELEGATION OF DUTIES. The Agent may execute any of its duties
under this Agreement or any other Document by or through its agents or
attorneys-in-fact, and shall be entitled to the advice of counsel concerning all
matters pertaining to its rights and duties hereunder or under the Loan
Documents. The Agent shall not be responsible for the negligence or misconduct
of any agents or attorneys-in-fact selected by it with reasonable care.
11.1.4 EXCULPATORY PROVISIONS. Neither the Agent nor any of its
officers, directors, employees, agents, attorneys-in-fact or affiliates shall be
liable for any action lawfully taken or omitted to be taken by it or them under
or in connection with this Agreement or the other Loan Documents, except for its
or their gross negligence or willful misconduct. Neither the Agent nor any of
its officers, directors, employees, agents, attorneys-in-fact or affiliates
shall be responsible for or have any duty to ascertain, inquire into, or verify
(i) any recital, statement, representation or warranty made by the Borrower or
any of its officers or agents contained in this Agreement or the other Loan
Documents or in any certificate or other document delivered in connection
therewith; (ii) the performance or observance of any of the covenants or
agreements contained in, or the conditions of, this Agreement or the other Loan
Documents; (iii) the state or condition of any properties of the Borrower or any
other obligor hereunder constituting Collateral for the Obligations of the
Borrower hereunder, except as may be specifically provided in this Agreement or
the Exhibits hereto (subject to the immediately preceding sentence), or any
information contained in the books or records of the Borrower; (iv) the
validity, enforceability, collectibility, effectiveness or genuineness of this
Agreement or any other Loan Document or any other certificate, document or
instrument furnished in connection therewith; or (v) the validity, priority or
perfection of any lien securing or purporting to secure the Obligations or the
value or sufficiency of any of the Collateral.
11.1.5 RELIANCE BY AGENT. The Agent shall be entitled to rely, and
shall be fully protected in relying, upon any notice, consent, certificate,
affidavit, or other document or writing believed by it to be genuine and correct
and to have been signed, sent or made by the proper person or persons, and upon
37
the advice and statements of legal counsel (including, without, limitation,
counsel to the Borrower), independent accountants and other experts selected by
the Agent. The Agent shall be fully justified in failing or refusing to take any
action under this Agreement or any other Loan Document unless it shall first
receive such advice or concurrence of the Requisite Lenders (or all the Lenders,
if and to the extent required pursuant to Section 11.4.1 hereof) as it deems
appropriate or it shall first be indemnified to its satisfaction by the Lenders
against any and all liability and expense which may be incurred by it by reason
of the taking or failing to take any such action. The Agent shall in all cases
be fully protected in acting, or in refraining from acting, under this Agreement
and the other Loan Documents in accordance with any written request of the
Requisite Lenders, and each such request of the Requisite Lenders, and any
action taken or failure to act by the Agent pursuant thereto, shall be binding
upon all of the Lenders; provided, however, that the Agent shall not be required
in any event to act, or to refrain from acting, in any manner which is contrary
to the Loan Documents or to applicable law.
11.1.6 NOTICE OF DEFAULT. The Agent shall not be deemed to have
knowledge or notice of the occurrence of any Default unless the Agent has actual
knowledge of the same or has received notice from a Lender or the Borrower
referring to this Agreement, describing such Default and stating that such
notice is a "notice of default". In the event that the Agent obtains such actual
knowledge or receives such a notice, the Agent shall give prompt notice thereof
to each of the Lenders. The Agent shall take such action with respect to such
Default as shall be reasonably directed by the Requisite Lenders (or all the
Lenders, if and to the extent required pursuant to Section 11.4.1 hereof).
Unless and until the Agent shall have received such direction, the Agent may
(but shall not be obligated to) take such action, or refrain from taking such
action, with respect to any such Default as it shall deem advisable in the best
interest of the Lenders, provided, however, that the Agent shall not accelerate
the indebtedness under this Agreement without the prior written consent of the
Requisite Lenders.
11.1.7 LENDERS' CREDIT DECISIONS. Each Lender acknowledges that it
has, independently and without reliance upon the Agent or any other Lender, and
based on the financial statements prepared by the Borrower and the Guarantors
and such other documents and information as it has deemed appropriate, made its
own credit analysis and investigation into the business, assets, operations,
property, and financial and other condition of the Borrower and the Guarantors
and has made its own decision to enter into this Agreement and the other Loan
Documents. Each Lender also acknowledges that it will, independently and without
reliance upon the Agent or any other Lender, and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit decisions in determining whether or not conditions precedent to closing
any Loan hereunder have been satisfied and in taking or not taking any action
under this Agreement and the other Loan Documents.
11.1.8 AGENT'S REIMBURSEMENT AND INDEMNIFICATION. The Lenders agree to
reimburse and indemnify the Agent, ratably in proportion to their respective
Commitments, for (i) any amounts not reimbursed by the Borrower for which the
Agent is entitled to reimbursement by the Borrower under this Agreement or the
other Loan Documents, (ii) any other expenses incurred by the Agent on behalf of
the Lenders in connection with the preparation, execution, delivery,
administration, amendment, waiver and/or enforcement of this Agreement and the
other Loan Documents, and (iii) any liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements of any
kind and nature whatsoever which may imposed on, incurred by or asserted against
the Agent in any way relating to or arising out of this Agreement or the other
Loan Documents or any other document delivered in connection therewith or any
transaction contemplated thereby, or the enforcement of any of the terms hereof
or thereof, provided that no Lender shall be liable for any of the foregoing to
the extent that they arise from the gross negligence or willful misconduct of
the Agent. If any indemnity furnished to the Agent for any purpose shall, in the
opinion of the Agent, be insufficient or become impaired, the Agent may call for
additional indemnity and cease, or not commence, to do the action indemnified
against until such additional indemnity is furnished.
11.1.9 AGENT IN ITS INDIVIDUAL CAPACITY. With respect to its
Commitment as a Lender, and the Loans made by it and the Note issued to it, the
Agent shall have the same rights and powers hereunder and under any other Loan
Document as any Lender and may exercise the same as though it were not the
Agent, and the term "Lender" or "Lenders" shall, unless the context otherwise
indicates, include the Agent in its individual capacity. The Agent and its
subsidiaries and affiliates may accept deposits from, lend money to, and
generally engage in any kind of commercial or investment banking, trust,
advisory or other business with the Borrower or any subsidiary or affiliate of
the Borrower as if it were not the Agent hereunder.
38
11.1.10 SUCCESSOR AGENT. The Agent may resign at any time by giving
thirty (30) days' prior written notice to the Lenders and the Borrower. The
Requisite Lenders, for good cause, may remove Agent at any time by giving thirty
(30) days' prior written notice to the Agent, the Borrower and the other
Lenders. Upon any such resignation or removal, the Requisite Lenders shall have
the right to appoint a successor Agent. If no successor Agent shall have been so
appointed by the Requisite Lenders and accepted such appointment within thirty
(30) days after the retiring Agent's giving notice of resignation or the
Requisite Lenders' giving notice of removal, as the case may be, then the
retiring or removed Agent may appoint, on behalf of the Borrower and the
Lenders, a successor Agent. Each such successor Agent shall be a financial
institution which meets the requirements of an Eligible Assignee. Upon the
acceptance of any appointment as Agent hereunder by a successor Agent, such
successor Agent shall thereupon succeed to and become vested with all the
rights, powers, privileges and duties of the retiring or removed Agent, and the
retiring or removed Agent shall be discharged from its duties and obligations
hereunder and under the other Loan Documents. After any retiring Agent's
resignation hereunder, or the removal of the Agent hereunder, the provisions of
this Section 11 shall continue in effect for its benefit in respect of any
actions taken or omitted to be taken by it while it was acting as the Agent
hereunder.
11.1.11 DUTIES IN THE CASE OF ENFORCEMENT. In case one or more Events
of Default have occurred and shall be continuing, and whether or not
acceleration of the Obligations shall have occurred, the Agent shall, at the
request, or may, upon the consent, of the Requisite Lenders, and provided that
the Lenders have given to the Agent such additional indemnities and assurances
against expenses and liabilities as the Agent may reasonably request, proceed to
enforce the provisions of this Agreement and the other Loan Documents respecting
the foreclosure of mortgages, the sale or other disposition of all or any part
of the Collateral and the exercise of any other legal or equitable rights or
remedies as it may have hereunder or under any other Loan Document or otherwise
by virtue of applicable law, or to refrain from so acting if similarly requested
by the Requisite Lenders. The Agent shall be fully protected in so acting or
refraining from acting upon the instruction of the Requisite Lenders, and such
instruction shall be binding upon all the Lenders. The Requisite Lenders may
direct the Agent in writing as to the method and the extent of any such
foreclosure, sale or other disposition or the exercise of any other right or
remedy, the Lenders hereby agreeing to indemnify and hold the Agent harmless
from all costs and liabilities incurred in respect of all actions taken or
omitted in accordance with such direction, provided that the Agent need not
comply with any such direction to the extent that the Agent reasonably believes
the Agent's compliance with such direction to be unlawful or commercially
unreasonable in any applicable jurisdiction. The Agent may, in its discretion
but without obligation, in the absence of direction from the Requisite Lenders,
take such interim actions as it believes necessary to preserve the rights of the
Lenders hereunder and in and to any Collateral securing the Obligations,
including but not limited to petitioning a court for injunctive relief,
appointment of a receiver or preservation of the proceeds of any Collateral.
Each of the Lenders acknowledges and agrees that no individual Lender may
separately enforce or exercise any of the provisions of any of the Loan
Documents, including without limitation the Notes, other than through the Agent.
11.1.12 DISTRIBUTIONS OF NOTICES AND DOCUMENTS . The Agent will
forward to each Lender, promptly after the Agent's receipt thereof, a copy of
each notice or other document furnished to the Agent pursuant to this Agreement
other than routine communications associated with requests for Warehousing
Advances or determinations of Collateral eligibility, other routine or
nonmaterial communications, notices or documents required by any of Loan
Documents to be furnished directly to the Lenders by the Borrower, or of which
the Agent has knowledge that such notice or document otherwise had been
forwarded directly to the Lenders other than by the Agent.
11.2 RESPECTING LOANS AND PAYMENTS.
-----------------------------
11.2.1 PROCEDURES FOR WAREHOUSING ADVANCES. Agent shall give written
notice to each Lender of each request for a Warehousing Advance by facsimile
transmission, hand delivery or overnight courier on the same Business Day as
received from the Borrower pursuant to Section 2.3.1. Each such notice shall be
accompanied by a written summary of the request for a Warehousing Advance and
shall specify (a) the date of the requested Warehousing Advance, (b) the
aggregate amount of the requested Warehousing Advance, and (c) each Lender's pro
rata share of the requested Warehousing Advance. Each Lender shall, before 11:00
a.m. (Boston time) on the date set forth in any such request for a Warehousing
Advance, make available to Agent, at an account to be designated by Agent at
Fleet National Bank in Boston, Massachusetts, in same day funds, each Lender's
ratable portion of the requested Warehousing Advance. After Agent's receipt of
such funds and upon Agent's determination that the applicable conditions to
39
making the requested Warehousing Advance have been fulfilled, Agent shall make
such funds available to the Borrower as provided for in this Agreement. Within a
reasonable period of time following the making of each Warehousing Advance,
Agent shall deliver to each Lender a copy of the Borrower's request for such
Warehousing Advance. Promptly after receipt by Agent of written request from any
Lender, Agent shall deliver to the requesting Lender the accompanying
certifications and such other instruments, documents, certifications and
approvals delivered by or on behalf of the Borrower to Agent in support of the
requested Warehousing Advance.
11.2.2 NATURE OF OBLIGATIONS OF LENDERS. The obligations of the
Lenders hereunder are several and not joint. Failure of any Lender to fulfill
its obligations hereunder shall not result in any other Lender becoming
obligated to advance more than its Commitment Percentage of the Loan, nor shall
such failure release or diminish the obligations of any other Lender to fund its
Commitment Percentage provided herein.
11.2.3 PAYMENTS TO AGENT. All payments of principal of and interest on
the Loan or the Notes shall be made to the Agent by the Borrower or any other
obligor or guarantor for the account of the Lenders in immediately available
funds as provided in the Notes and this Agreement and any other Loan Document.
Except as otherwise expressly provided herein, the Agent agrees to use its
reasonable best efforts to promptly to distribute to each Lender, on the same
Business Day upon which each such payment is made (if received prior to 2:00
p.m. on such Business Day), such Lender's proportionate share of each such
payment in immediately available funds excluding Liquidation Proceeds which
shall be distributed in accordance with Section 11.2.4 below. The Agent shall
upon each distribution promptly notify the Borrower of such distribution and
each Lender of the amounts distributed to it applicable to principal of, and
interest on, the proportionate share held by the applicable Lender. Each payment
to the Agent under the first sentence of this Section shall constitute a payment
by the Borrower to each Lender in the amount of such Lender's proportionate
share of such payment, and any such payment to the Agent shall not be considered
outstanding for any purpose after the date of such payment by the Borrower to
the Agent without regard to whether or when the Agent makes distribution thereof
as provided above. If any payment received by the Agent from the Borrower is
insufficient to pay both all accrued interest and all principal then due and
owing, unless otherwise provided herein, the Agent shall first apply such
payment to all outstanding interest until paid in full and shall then apply the
remainder of such payment to all principal then due and owing, and shall
distribute the payment to each Lender accordingly.
11.2.4 DISTRIBUTION OF LIQUIDATION PROCEEDS.
------------------------------------
Subject to the terms and conditions hereof, the Agent shall distribute all
Liquidation Proceeds in the order and manner set forth below:
First: To the Agent, towards any fees and any expenses for which the
Agent is entitled to reimbursement under this Agreement or the
other Loan Documents not theretofore paid to the Agent.
Second: To all applicable Lenders in accordance with their
proportional share based upon their respective Commitment
Percentages until all Lenders have been reimbursed for all
expenses which such Lenders have previously paid to the Agent and
not theretofore paid to such Lenders.
Third: To all Lenders in accordance with their proportional share
based upon their respective Commitment Percentages until all
Lenders have been paid in full all principal and interest due to
such Lenders under the Loan, with each Lender applying such
proceeds for purposes of this Agreement first against the
outstanding principal balance due to such Lender under the Loan
and then to accrued and unpaid interest due under the Loan.
Fourth: To Fleet National Bank any costs and expenses incurred
directly by Fleet National Bank as a result of any breach of any
Hedging Arrangements.
Fifth: To all applicable Lenders in accordance with their proportional
share based upon their respective Commitment Percentages until
all Lenders have been paid in full all other amounts due to such
Lenders under the Loan including, without limitation, any costs
40
and expenses incurred directly by such Lenders to the extent such
costs and expenses are reimbursable to such Lenders by the
Borrower under the Loan Documents.
Sixth: To the Borrower or such third parties as may be entitled to
claim Liquidation Proceeds.
11.2.5 ADJUSTMENTS. If, after Agent has paid each Lender's
proportionate share of any payment received or applied by Agent in respect of
the Loan, that payment is rescinded or must otherwise be returned or paid over
by Agent, whether pursuant to any bankruptcy or insolvency law, sharing of
payments clause of any loan agreement or otherwise, such Lender shall, at
Agent's request, promptly return its proportionate share of such payment or
application to Agent, together with the Lender's proportionate share of any
interest or other amount required to be paid by Agent with respect to such
payment or application.
11.2.6 SETOFF. If any Lender (including the Agent), acting in its
individual capacity, shall exercise any right of setoff against a deposit
balance or other account of the Borrower held by such Lender on account of the
obligations of the Borrower under this Agreement, such Lender shall remit to the
Agent all such sums received pursuant to the exercise of such right of setoff,
and the Agent shall apply all such sums for the benefit of all of the Lenders
hereunder in accordance with the terms of this Agreement.
11.2.7 DISTRIBUTION BY AGENT. If in the opinion of the Agent
distribution of any amount received by it in such capacity hereunder or under
the Notes or under any of the other Loan Documents might involve any liability,
it may refrain from making distribution until its right to make distribution
shall have been adjudicated by a court of competent jurisdiction or has been
resolved by the mutual consent of all Lenders. In addition, the Agent may
request full and complete indemnity, in form and substance satisfactory to it,
prior to making any such distribution. If a court of competent jurisdiction
shall adjudge that any amount received and distributed by the Agent is to be
repaid, each person to whom any such distribution shall have been made shall
either repay to the Agent its proportionate share of the amount so adjudged to
be repaid or shall pay over to the same in such manner and to such persons as
shall be determined by such court.
11.2.8 DELINQUENT LENDER. If for any reason any Lender shall fail or
refuse to abide by its obligations under this Agreement, including without
limitation its obligation to make available to Agent its pro rata share of any
Loans, expenses or setoff (a "Delinquent Lender") and such failure is not cured
within ten (10) days of receipt from the Agent of written notice thereof, then,
in addition to the rights and remedies that may be available to Agent, other
Lenders, the Borrower or any other party at law or in equity, and not in
limitation thereof, (i) such Delinquent Lender's right to participate in the
administration of, or decision-making rights related to, the Loans, this
Agreement or the other Loan Documents shall be suspended during the pendency of
such failure or refusal, and (ii) a Delinquent Lender shall be deemed to have
assigned any and all payments due to it from the Borrower, whether on account of
outstanding Loans, interest, fees or otherwise, to the remaining non-delinquent
Lenders for application to, and reduction of, their proportionate shares of all
outstanding Loans until, as a result of application of such assigned payments
the Lenders' respective pro rata shares of all outstanding Loans shall have
returned to those in effect immediately prior to such delinquency and without
giving effect to the nonpayment causing such delinquency. The Delinquent
Lender's decision-making and participation rights and rights to payments as set
forth in clauses (i) and (ii) hereinabove shall be restored only upon the
payment by the Delinquent Lender of its pro rata share of any Loans, expenses or
setoffs as to which it is delinquent, together with interest thereon at the
Default Rate from the date when originally due until the date upon which any
such amounts are actually paid.
The non-delinquent Lenders shall also have the right, but not the
obligation, in their respective, sole and absolute discretion, to acquire for no
cash consideration, (PRO RATA, based on the respective Commitments of those
Lenders electing to exercise such right) the Delinquent Lender's Commitment to
fund future Loans (the "Future Commitment"). Upon any such purchase of the PRO
RATA share of any Delinquent Lender's Future Commitment, the Delinquent Lender's
share in future Loans and its rights under the Loan Documents with respect
thereto shall terminate on the date of purchase, and the Delinquent Lender shall
promptly execute all documents reasonably requested to surrender and transfer
such interest, including, if so requested, an Assignment and Acceptance. Each
Delinquent Lender shall indemnify Agent and each non-delinquent Lender from and
against any and all loss, damage or expenses, including but not limited to
reasonable attorneys' fees and funds advanced by Agent or by any non-delinquent
Lender, on account of a Delinquent Lender's failure to timely fund its PRO RATA
share of a Loan or to otherwise perform its obligations under the Loan
Documents.
41
11.2.9 HOLDERS. The Agent may deem and treat the payee of any Note as
the owner thereof for all purposes hereof unless and until a written notice of
the assignment, transfer or endorsement thereof, as the case may be, shall have
been filed with the Agent. Any request, authority or consent of any person or
entity who, at the time of making such request or giving such authority or
consent, is the holder of any Note shall be conclusive and binding on any
subsequent holder, transferee or endorsee, as the case may be, of such Note or
of any Note or Notes issued in exchange therefor.
11.3 ASSIGNMENT AND PARTICIPATION.
----------------------------
11.3.1 CONDITIONS TO ASSIGNMENT BY LENDERS. Except as provided herein,
each Lender may assign to one or more Eligible Assignees all or a portion of its
interests, rights and obligations under this Agreement (including all or a
portion of its Commitment Percentage and Commitment and the same portion of the
Loans at the time owing to it and the Notes held by it), upon satisfaction of
the following conditions: (a) each of the Agent and the Borrower shall have
given its prior written consent to such assignment (provided that, in the case
of the Borrower, such consent will not be unreasonably withheld and shall not be
required if a Default shall have occurred and be continuing); (b) each such
assignment shall be of a constant, and not a varying, percentage of all the
assigning Lender's rights and obligations under this Agreement, (c) each
assignment shall be in an amount that is at least $10,000,000.00 and is a whole
multiple of $250,000.00, (d) each Lender which is a Lender at the time of such
assignment shall retain, free of any such assignment, an amount of its
Commitment of not less than $5,000,000.00, (e) the Agent, in its individual
capacity as a Lender, shall retain, free of any such assignment, an amount of
its Commitment of not less than $20,000,000.00, and (f) the parties to such
assignment shall execute and deliver to the Agent, for recording in the Register
(as hereinafter defined), an Assignment and Acceptance, substantially in the
form of EXHIBIT E hereto (an "Assignment and Acceptance"), together with any
Notes subject to such assignment. Upon such execution, delivery, acceptance and
recording, from and after the effective date specified in each Assignment and
Acceptance, which effective date shall be at least five (5) Business Days after
the execution thereof, (x) the assignee thereunder shall be a party hereto and,
to the extent provided in such Assignment and Acceptance, have the rights and
obligations of a Lender hereunder, and (y) the assigning Lender shall, to the
extent provided in such assignment and upon payment to the Agent of the
registration fee referred to in Section 13.3.3, be released from its obligations
under this Agreement.
11.3.2 CERTAIN REPRESENTATIONS AND WARRANTIES, LIMITATIONS, COVENANTS.
By executing and delivering an Assignment and Acceptance, the parties to such
Assignment and Acceptance confirm to and agree with each other and the other
parties hereto as follows:
(a) other than the representation and warranty that it is the
legal and beneficial owner of the interest being assigned thereby free and
clear of any adverse claim, the assigning Lender makes no representation or
warranty, express or implied, and assumes no responsibility with respect to
any statements, warranties or representations made in or in connection with
this Agreement or the execution, legality, validity, enforceability,
genuineness, sufficiency or value of this Agreement, the other Loan
Documents or any other instrument or document furnished pursuant hereto or
the attachment, perfection or priority of any security interest or
mortgage;
(b) the assigning Lender makes no representation or warranty and
assumes no responsibility with respect to the financial condition of the
Borrower and its affiliates, related entities or subsidiaries or any other
person primarily or secondarily liable in respect of any of the
Obligations, or the performance or observance by the Borrower or any other
person primarily or secondarily liable in respect of any of the Obligations
of any of their obligations under this Agreement or any of the other Loan
Documents or any other instrument or document furnished pursuant hereto or
thereto;
(c) such assignee confirms that it has received a copy of this
Agreement, together with copies of the most recent financial statements
provided by the Borrower as required by the terms of this Agreement,
together with such other documents and information as it has deemed
appropriate to make its own credit analysis and decision to enter into such
Assignment and Acceptance;
42
(d) such assignee will, independently and without reliance upon
the assigning Lender, the Agent or any other Lender and based on such
documents and information as it shall deem appropriate at the time,
continue to make its own credit decisions in taking or not taking action
under this Agreement;
(e) such assignee represents and warrants that it is an Eligible
Assignee;
(f) such assignee appoints and authorizes the Agent to take such
action as agent on its behalf and to exercise such powers under this
Agreement and the other Loan Documents as are delegated to the Agent by the
terms hereof or thereof, together with such powers as are reasonably
incidental thereto;
(g) such assignee agrees that it will perform in accordance with
their terms all of the obligations that by the terms of this Agreement are
required to be performed by it as a Lender; and
(h) such assignee represents and warrants that it is legally
authorized to enter into such Assignment and Acceptance.
11.3.3 REGISTER. The Agent shall maintain a copy of each Assignment
and Acceptance delivered to it and a register or similar list (the "Register")
for the recordation of the names and addresses of the Lenders and the Commitment
Percentage of, and principal amount of the Loans owing to the Lenders from time
to time. The entries in the Register shall be conclusive, in the absence of
manifest error, and the Borrower, the Agent and the Lenders may treat each
person whose name is recorded in the Register as a Lender hereunder for all
purposes of this Agreement. The Register shall be available for inspection by
the Borrower and the Lenders at any reasonable time and from time to time upon
reasonable prior notice. Upon each such recordation, the assigning Lender agrees
to pay to the Agent a registration fee in the sum of ($5,000.00).
11.3.4 NEW NOTES. Upon its receipt of an Assignment and Acceptance
executed by the parties to such assignment, together with each Note subject to
such assignment, the Agent shall (a) record the information contained therein in
the Register, and (b) give prompt notice thereof to the Borrower and the Lenders
(other than the assigning Lender). Within five (5) Business Days after receipt
of such notice, the Borrower, at its own expense, shall execute and deliver to
the Agent, in exchange for each surrendered Note, a new Note to the order of
such Eligible Assignee in an amount equal to the amount assumed by such Eligible
Assignee pursuant to such Assignment and Acceptance and, if the assigning Lender
has retained some portion of its obligations hereunder, a new Note to the order
of the assigning Lender in an amount equal to the amount retained by it
hereunder. Such new Notes shall provide that they are replacements for the
surrendered Notes, shall be in an aggregate principal amount equal to the
aggregate principal amount of the surrendered Notes, shall be dated the
effective date of such Assignment and Acceptance and shall otherwise be
substantially the form of the assigned Notes. Within five (5) days of issuance
of any new Notes pursuant to this Section 11.3.4, the Borrower shall deliver an
opinion of counsel, addressed to the Lenders and the Agent, relating to the due
authorization, execution and delivery of such new Notes and the legality,
validity and binding effect thereof, in form and substance satisfactory to the
Lenders. The surrendered Notes shall be cancelled and returned to the Borrower.
11.3.5 PARTICIPATIONS. Each Lender may sell participations to one or
more banks or other financial institutions in all or a portion of such Lender's
rights and obligations under this Agreement and the other Loan Documents;
provided that (a) each such participation shall be in a minimum amount of
$5,000,000.00, (b) each participant shall meet the requirements of an Eligible
Assignee, (c) any such sale or participation shall not affect the rights and
duties of the selling Lender hereunder to the Borrower, and (d) the only rights
granted to the participant pursuant to such participation arrangements with
respect to waivers, amendments or modifications of the Loan Documents shall be
the rights to approve waivers, amendments or modifications that would reduce the
principal of or the interest rate on any Loans, extend the term or increase the
amount of the Commitment of such Lender as it relates to such participant,
reduce the amount of any commitment fees to which such participant is entitled
or extend any regularly scheduled payment date for principal or interest.
11.3.6 DISCLOSURE. The Borrower agrees that in addition to disclosures
made in accordance with standard and customary banking practices any Lender may
disclose information obtained by such Lender pursuant to this Agreement to
assignees or participants and potential assignees or participants hereunder;
provided that such assignees or participants or potential assignees or
participants shall agree (a) to treat in confidence such information unless such
43
information otherwise becomes public knowledge, (b) not to disclose such
information to a third party, except as required by law or legal process and (c)
not to make use of such information for purposes of transactions unrelated to
such contemplated assignment or participation.
11.3.7 MISCELLANEOUS ASSIGNMENT PROVISIONS. Any assigning Lender shall
retain its rights to be indemnified pursuant to Section 7.25 with respect to any
claims or actions arising prior to the date of such assignment. If any assignee
Lender is not incorporated under the laws of the United States of America or any
state thereof, it shall, prior to the date on which any interest or fees are
payable hereunder or under any of the other Loan Documents for its account,
deliver to the Borrower and the Agent certification as to exemption from
deduction or withholding of any United States federal income taxes. Anything
contained in this Section 11.3.7 to the contrary notwithstanding (a) any Lender
may at any time pledge all or any portion of its interest and rights under this
Agreement (including all or any portion of its Notes) to any of the twelve
Federal Reserve Banks organized under ss.4 of the Federal Reserve Act, 12 U.S.C.
ss.341, and (b) any Lender may assign, pledge or participate its interests,
rights and obligations under this Agreement, including its right to receive and
retain payments on its Note, in connection with any arrangement maintained by
such Lender to fund credit facilities provided by that Lender; PROVIDED,
HOWEVER, that such Lender shall remain primarily and directly liable to timely
and fully perform all of its obligations under this Agreement, and no such
pledge or the enforcement thereof shall release the pledgor Lender from its
obligations hereunder or under any of the other Loan Documents or require the
Borrower to have direct duties or responsibilities to more than one such
assignee, pledgee, or participant of such pledgor Lender under this sentence.
11.3.8 ASSIGNMENT BY BORROWER. The Borrower shall not assign or
transfer any of its rights or obligations under any of the Loan Documents
without the prior written consent of each of the Lenders.
11.4 ADMINISTRATIVE MATTERS.
----------------------
11.4.1 AMENDMENT, WAIVER, CONSENT, ETC. Except as otherwise provided
herein or as to any term or provision hereof which provides for the consent or
approval of the Agent, no term or provision of this Agreement or any other Loan
Document may be changed, waived, discharged or terminated, nor may any consent
required or permitted by this Agreement or any other Loan Document be given,
unless such change, waiver, discharge, termination or consent receives the
written approval of the Requisite Lenders.
Notwithstanding the foregoing, the unanimous written approval of all the
Lenders (other than a Defaulting Lender) shall be required with respect to any
proposed amendment, waiver, discharge, termination, or consent which:
(i) has the effect of (a) extending the final scheduled maturity
or the date of any amortization payment of any Loan or Note, (b) reducing
the rate or extending the time of payment of interest or fees thereon, (c)
increasing or reducing the principal amount thereof, or (d) otherwise
postponing or forgiving any indebtedness thereunder,
(ii) releases or discharges any material portion of the
Collateral other than in accordance with the express provisions of the Loan
Documents,
(iii) amends, modifies or waives any provisions of this paragraph
11.4.1,
(iv) amends, modifies or waives any provisions of Section 2.1.3
and the limitations set forth on EXHIBIT D or the definition of any term
used therein or used in any of the financial covenants set forth in Section
7.26,
(v) reduces the percentage specified in the definition of
Requisite Lenders,
(vi) except as otherwise provided in the Agreement or arising by
the assignment by a lender of a portion of its Commitment, changes the
amount of any Lender's Commitment or Commitment Percentage, or
44
(vii) releases or waives any guaranty of the Obligations or
indemnifications provided in the Loan Documents;
and PROVIDED, further, that without the consent of the Agent, no such action
shall amend, modify or waive any provision of this Article or any other
provision of any Loan Document which relates to the rights or obligations of the
Agent.
11.4.2 DEEMED CONSENT OR APPROVAL. With respect to any requested
amendment, waiver, consent or other action which requires the approval of the
Requisite Lenders or all of the Lenders, as the case may be, in accordance with
the terms of this Agreement, or if the Agent is required hereunder to seek, or
desires to seek, the approval of the Requisite Lenders or all of the Lenders, as
the case may be, prior to undertaking a particular action or course of conduct,
the Agent in each such case shall provide each Lender with written notice of any
such request for amendment, waiver or consent or any other requested or proposed
action or course of conduct, accompanied by such detailed background information
and explanations as may be reasonably necessary to determine whether to approve
or disapprove such amendment, waiver, consent or other action or course of
conduct. The Agent may (but shall not be required to) include in any such
notice, printed in capital letters or boldface type, a legend substantially to
the following effect:
"THIS COMMUNICATION REQUIRES IMMEDIATE RESPONSE. FAILURE TO RESPOND WITHIN
TEN (10) CALENDAR DAYS FROM THE RECEIPT OF THIS COMMUNICATION SHALL
CONSTITUTE A DEEMED APPROVAL BY THE ADDRESSEE OF THE ACTION REQUESTED BY
THE BORROWER OR THE COURSE OF CONDUCT PROPOSED BY THE AGENT AND RECITED
ABOVE,"
and if the foregoing legend is included by the Agent in its communication, a
Lender shall be deemed to have approved or consented to such action or course of
conduct for all purposes hereunder if such Lender fails to object to such action
or course of conduct by written notice to Agent within ten (10) calendar days of
such Lender's receipt of such notice; PROVIDED, HOWEVER, that, upon the written
request of any Lender for additional time to consider such proposed action or
course of conduct in accordance with the requirements of such Lender's internal
review process, the foregoing 10-day period shall be extended by the Agent for
up to an additional ten (10) calendar days.
12. GENERAL PROVISIONS.
------------------
12.1 NOTICES. Any notice or other communication in connection with this
Agreement, the Notes, or any of the other Loan Documents (a "Notice"), shall be
in writing, and (i) deposited in the United States Mail, postage prepaid, by
registered or certified mail, or (ii) hand delivered by any commercial
recognized courier service or overnight delivery service such as Federal
Express, or (iii) sent by facsimile transmission if a FAX Number is designated
below, addressed as set forth below:
If to the Borrower:
CharterMac Mortgage Capital Corporation
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Fax Number: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: Chief Financial Officer
with copies by regular mail or such hand delivery or facsimile transmission to:
Proskauer Rose LLP
▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
FAX Number: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, Esquire
45
If to Agent, or to such Person in its capacity as a Lender:
Fleet National Bank
One Federal Street
Mail Code: MA5-503-04-16
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
FAX Number: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇. ▇▇▇▇ ▇. ▇▇▇▇▇
with copies by regular mail or such hand delivery or facsimile transmission to
(which shall not constitute notice):
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ & Fish, LLP
World Trade Center West
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
FAX Number: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇, Esquire
If to a Lender (other than Fleet National Bank): To such address for such
Lender as appears on SCHEDULE 1.
Any such addressee may change its address for such notices to such other address
in the United States as such addressee shall have specified by written notice
given as set forth above. All periods of notice shall be measured from the
deemed date of delivery.
A notice shall be deemed to have been given, delivered and received for the
purposes of all Loan Documents upon the earliest of: (i) if sent by such
certified or registered mail, on the earlier of the third Business Day following
the date of postmark or on the date of actual receipt, or (ii) if hand delivered
at the specified address by such courier or overnight delivery service, when so
delivered or tendered for delivery during customary business hours on a Business
Day, or (iii) if facsimile transmission is a permitted means of giving notice,
upon receipt as evidenced by confirmation.
12.2 PAYMENTS TO BE CHARGED AS AN ADVANCE. Any payments required by this
Agreement, the Notes or any of the other Loan Documents may (but not before the
due date thereof) be deducted by Lender from the amount, if any, not already
advanced, and the same shall be deemed to be a Loan, or may be deducted from any
Loan due hereunder. Any attorneys' fees, inspection fee, or any other expense
payable by the Borrower as herein provided for, or incurred in connection with
the examination of the Collateral for the Loan, any tangible or intangible
assets of the Borrower, the drafting of the Loan Documents and other instruments
evidencing or securing the Obligations and all other Loan Documents may be
likewise deducted from the amounts, if any, not already advanced or from any
Loan payable to the Borrower and, in any event, charged as a Loan hereunder, but
only to the extent payable by the Borrower pursuant to Section 7.24 hereof.
12.3 PARTIES BOUND; INTEGRATION. The provisions of this Agreement and of
each of the other Loan Documents shall be binding upon and inure to the benefit
of Borrower and the Agent and each of the Lenders and their respective
successors and assigns, except as otherwise prohibited by this Agreement or any
of the other Loan Documents.
This Agreement is a contract by and among Borrower, Agent and each of the
Lenders for their mutual benefit, and no third person shall have any right,
claim or interest against either Agent, any of the Lenders, or Borrower as a
third party beneficiary or otherwise by virtue of any provision hereof.
This Agreement is intended by the Borrower, the Agent and the Lenders as
the final, complete and exclusive statement of the transactions evidenced by
this Agreement. All prior or contemporaneous promises, agreements and
understandings, whether oral or written, are deemed to be superceded by this
Agreement, and no party is relying on any promise, agreement or understanding
not set forth in this Agreement.
46
12.4 WAIVERS, EXTENSIONS AND RELEASES. Except as otherwise provided herein,
the Agent, the Requisite Lenders or all of the Lenders, as applicable, may at
any time and from time to time waive any one or more of the conditions contained
herein or in any of the other Loan Documents, or extend the time of payment of
the Loan, or release portions of the Collateral from the provisions of this
Agreement and from the Security Documents, but any such waiver, extension or
release shall be deemed to be made in pursuance and not in modification hereof,
and any such waiver in any instance, or under any particular circumstance shall
not be considered a waiver of such condition in any other instance or any other
circumstance.
12.5 GOVERNING LAW; CONSENT TO JURISDICTION; MUTUAL WAIVER OF JURY TRIAL.
-------------------------------------------------------------------
12.5.1 SUBSTANTIAL RELATIONSHIP. It is understood and agreed that all
of the Loan Documents were negotiated, executed and delivered in the
Commonwealth of Massachusetts, which Commonwealth the parties agree has a
substantial relationship to the parties and to the underlying transactions
embodied by the Loan Documents.
12.5.2 PLACE OF DELIVERY. The Borrower agrees to furnish to Agent at
the Agent's office in Boston, Massachusetts all further instruments,
certifications and documents to be furnished hereunder.
12.5.3 GOVERNING LAW. This Agreement and each of the other Loan
Documents shall in all respects be governed, construed, applied and enforced in
accordance with the internal laws of the Commonwealth of Massachusetts without
regard to principles of conflicts of law.
12.6 CONSENT TO JURISDICTION. THE BORROWER AGREES THAT ANY SUIT FOR THE
ENFORCEMENT OF THIS AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS MAY BE BROUGHT
IN THE COURTS OF THE COMMONWEALTH OF MASSACHUSETTS OR ANY FEDERAL COURT SITTING
THEREIN AND CONSENTS TO THE NONEXCLUSIVE JURISDICTION OF SUCH COURT AND THE
SERVICE OF PROCESS IN ANY SUCH SUIT BEING MADE UPON THE BORROWER BY MAIL AT THE
ADDRESS SPECIFIED IN SECTION 12.1. THE BORROWER HEREBY WAIVES ANY OBJECTION THAT
IT MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY SUCH SUIT OR ANY SUCH COURT OR
THAT SUCH SUIT IS BROUGHT IN AN INCONVENIENT COURT.
12.7 JURY TRIAL WAIVER. THE BORROWER, AGENT AND LENDERS (BY ACCEPTANCE OF
THIS AGREEMENT) MUTUALLY HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE
THE RIGHT TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED HEREON, ARISING
OUT OF, UNDER OR IN CONNECTION WITH THIS AGREEMENT OR ANY OTHER LOAN DOCUMENTS
CONTEMPLATED TO BE EXECUTED IN CONNECTION HEREWITH, OR ANY COURSE OF CONDUCT,
COURSE OF DEALINGS, STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF ANY
PARTY, INCLUDING, WITHOUT LIMITATION, ANY COURSE OF CONDUCT, COURSE OF DEALINGS,
STATEMENTS OR ACTIONS OF AGENT OR ANY LENDER RELATING TO THE ADMINISTRATION OF
THE LOAN OR ENFORCEMENT OF THE LOAN DOCUMENTS, AND AGREE THAT NONE OF THE
PARTIES WILL SEEK TO CONSOLIDATE ANY SUCH ACTION WITH ANY OTHER ACTION IN WHICH
A JURY TRIAL CANNOT BE OR HAS NOT BEEN WAIVED. EXCEPT AS PROHIBITED BY LAW, THE
BORROWER HEREBY WAIVES ANY RIGHT IT MAY HAVE TO CLAIM OR RECOVER IN ANY
LITIGATION ANY SPECIAL, EXEMPLARY, PUNITIVE OR CONSEQUENTIAL DAMAGES OR ANY
DAMAGES OTHER THAN, OR IN ADDITION TO, ACTUAL DAMAGES. THE BORROWER CERTIFIES
THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF AGENT OR ANY LENDER HAS
REPRESENTED, EXPRESSLY OR OTHERWISE, THAT AGENT OR ANY LENDER WOULD NOT, IN THE
EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER. THIS WAIVER
CONSTITUTES A MATERIAL INDUCEMENT FOR AGENT AND THE LENDERS TO ACCEPT THIS
AGREEMENT AND MAKE THE LOAN.
12.8 SURVIVAL. All representations, warranties, covenants and agreements of
the Borrower herein or in any other Loan Document, or in any notice,
certificate, or other paper delivered by or on behalf of the Borrower pursuant
hereto are significant and shall be deemed to have been relied upon by Agent and
each of the Lenders notwithstanding any investigation made by Agent or each of
the Lenders or on its behalf and shall survive the delivery of the Loan
Documents and the making of the Loan and each advance pursuant thereto. No
review or approval by Agent or the Lenders, or by any of their consultants or
47
representatives, of any opinion letters, certificates by professionals or other
item of any nature shall relieve the Borrower or anyone else of any of the
obligations, warranties or representations made by or on behalf of the Borrower
under any one or more of the Loan Documents.
12.9 CUMULATIVE RIGHTS. All of the rights of the Agent and the Lenders
hereunder and under each of the other Loan Documents and any other agreement now
or hereafter executed in connection herewith or therewith, shall be cumulative
and may be exercised singly, together, or in such combination as Agent and each
Lender may determine in its sole good faith judgment.
12.10 CLAIMS AGAINST AGENT OR LENDERS.
-------------------------------
12.10.1 BORROWER MUST NOTIFY. The Agent and each of the Lenders shall
not be in default under this Agreement, or under any other Loan Document, unless
a written notice specifically setting forth the claim of the Borrower shall have
been given to Agent and each of the Lenders within thirty (30) days after the
Borrower first had actual knowledge or actual notice of the occurrence of the
event which the Borrower alleges gave rise to such claim and the Agent or such
Lender, as the case may be, does not remedy or cure the default, if any there
be, with reasonable promptness thereafter. Such actual knowledge or actual
notice shall refer to what was actually known by, or expressed in a written
notification furnished to any Authorized Representative.
12.10.2 REMEDIES. If it is determined by the final order of a court of
competent jurisdiction, which is not subject to further appeal, that Agent or
any of the Lenders has breached any of its obligations under the Loan Documents
and has not remedied or cured the same with reasonable promptness following
notice thereof, Agent's and each of the Lender's responsibilities shall be
limited to: (i) where the breach consists of the failure to grant consent or
give approval in violation of the terms and requirements of a Loan Document, the
obligation to grant such consent or give such approval and to pay Borrower's
reasonable costs and expenses including, without limitation, reasonable
attorneys' fees and disbursements in connection with such court proceedings; and
(ii) the case of any such failure to grant such consent or give such approval,
or in the case of any other such default by Agent or any of the Lenders, where
it is also so determined that Agent or any of the Lenders acted in bad faith,
the payment of any actual, direct, compensatory damages sustained by the
Borrower as a result thereof plus the Borrower's reasonable costs and expenses,
including, without limitation, reasonable attorneys' fees and disbursements in
connection with such court proceedings.
12.10.3 LIMITATIONS. In no event, however, shall Agent and any of the
Lenders be liable to the Borrower or anyone else for other damages such as, but
not limited to, indirect, speculative, consequential or punitive damages
whatever the nature of the breach by Agent or any of the Lenders of its
obligations under this Agreement or under any of the other Loan Documents. In no
event shall Agent or any of the Lenders be liable for direct damages to the
Borrower or anyone else unless a written notice specifically setting forth the
claim of the Borrower shall have been given to Agent and each of the Lenders
within the time period specified above.
12.11 OBLIGATIONS ABSOLUTE. Except to the extent prohibited by applicable
law which cannot be waived, the Obligations of the Borrower under the Loan
Documents shall be absolute, unconditional and irrevocable and shall be paid
strictly in accordance with the terms of the Loan Documents under all
circumstances whatsoever, including, without limitation, the existence of any
claim, set off, defense or other right which the Borrower may have at any time
against Agent or any of the Lenders whether in connection with the Loan or any
unrelated transaction.
12.12 COUNTERPARTS. This Agreement and each other Loan Document may be
executed in several counterparts, each of which when executed and delivered is
an original, but all of which together shall constitute one instrument. In
making proof of this agreement, it shall not be necessary to produce or account
for more than one such counterpart which is executed by the party against whom
enforcement of such loan agreement is sought.
12.13 TIME OF THE ESSENCE. Time is of the essence of each provision of this
Agreement and each other Loan Document.
48
12.14 NO ORAL CHANGE. This Agreement and each of the other Loan Documents
may only be amended, terminated, extended or otherwise modified by a writing
signed by the party against which enforcement is sought (except no such writing
shall be required for any party which, pursuant to a specific provision of any
Loan Document, is required to be bound by changes without such party's assent).
In no event shall any oral agreements, promises, actions, inactions, knowledge,
course of conduct, course of dealings or the like be effective to amend,
terminate, extend or otherwise modify this Agreement or any of the other Loan
Documents.
12.15 MONTHLY STATEMENTS. While Agent may issue invoices or other
statements on a monthly or periodic basis (a "Statement"), it is expressly
acknowledged and agreed that: (i) the failure of Agent to issue any Statement on
one or more occasions shall not affect the Borrower's obligations to make
payments under the Loan Documents as and when due; (ii) the inaccuracy of any
Statement shall not be binding upon the Agent or the Lenders and so the Borrower
shall always remain obligated to pay the full amount(s) required under the Loan
Documents as and when due notwithstanding any provision to the contrary
contained in any Statement; (iii) all Statements are issued for information
purposes only and shall never constitute any type of offer, acceptance,
modification, or waiver of the Loan Documents or any of the Agent's or Lenders'
rights or remedies thereunder; and (iv) in no event shall any Statement serve as
the basis for, or a component of, any course of dealing, course of conduct, or
trade practice which would modify, alter, or otherwise affect the express
written terms of the Loan Documents.
[REMAINDER OF PAGE LEFT INTENTIONALLY BLANK; SIGNATURES ON NEXT PAGE]
49
IN WITNESS WHEREOF this Agreement has been duly executed and delivered as a
sealed instrument at Boston, Massachusetts this _____ day of December, 2001.
BORROWER: CHARTERMAC MORTGAGE CAPITAL
CORPORATION
By: /s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
------------------
Name: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
--------------
Title: Senior Vice President
---------------------
AGENT AND LENDER: FLEET NATIONAL BANK, A BANK OF
AMERICA COMPANY
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇
-----------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇
-------------
Title: Senior Vice President
---------------------
LENDER: HSBC BANK USA, NATIONAL
ASSOCIATION
By: /s/ ▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
---------------------------
Name: ▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
-----------------------
Title: Vice President
--------------
CONSENT OF GUARANTORS:
Each of the Guarantors has guaranteed all of the Obligations under this
Agreement by executing a Guaranty, dated as of December 24, 2001. By executing
this Agreement in the space provided below, each of the Guarantors hereby
absolutely and unconditionally reaffirms that Guaranty to which it is a party,
and acknowledges and agrees to the terms and conditions of this Agreement and
the transactions contemplated by the Loan Documents.
[SIGNATURES CONTINUED ON NEXT PAGE]
S-1
GUARANTORS:
CHARTERMAC, a Delaware statutory trust
By: Charter Mac Corporation, its managing
member
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------
Title: Chief Financial Officer
-----------------------
CHARTER MAC CORPORATION
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------
Title: Chief Financial Officer
-----------------------
S-3
EXHIBITS AND SCHEDULES:
----------------------
SECTION
-------
REFERENCE
---------
NUMBER
------
EXHIBIT A - Definitions 1.1
---------
EXHIBIT B - Procedures and Documentation for Warehousing Advances 2.3.2
---------
EXHIBIT C - Form of Request for Warehousing Advances 2.3.2
---------
EXHIBIT D - Eligible Loans and Other Assets 2.1.3
---------
EXHIBIT E - Form of Assignment and Acceptance Agreement 11.3.1
---------
EXHIBIT F - Form of Lenders' Notes
---------
EXHIBIT G - Form of Compliance Certificate
---------
EXHIBIT H Commitment Increase Supplement
---------
SCHEDULE 1 - Lenders and Commitments
----------
SCHEDULE 4 - Authorized Representatives 4
-----------
SCHEDULE 6.3 - Litigation
------------
SCHEDULE 6.7.1 - Ownership, Subsidiaries and Taxpayer Identification Numbers
--------------
SCHEDULE 6.14 - Certain Transactions
-------------
SCHEDULE 6.20 - Servicing Portfolio
-------------
SCHEDULE 6.21 - Assumed Names
-------------
SCHEDULE 7.7 - Insurance
------------
SCHEDULE 7.12 - Indebtedness of Borrower and its Subsidiaries
-------------
SCHEDULE 7.14.1 - Other Indebtedness
---------------
SCHEDULE 7.14.2 - Other Liens
---------------
EXHIBIT A TO LOAN AGREEMENT
---------------------------
DEFINITIONS
-----------
ACCOUNTS has the meaning given that term in the UCC.
ACQUISITION FACILITY means that certain revolving acquisition facility, dated as
of the date of the Original Agreement, among Charter Mac Corporation, the Agent,
Fleet National Bank as a lender, and such other Persons which may become party
thereto, as the same may be modified, amended or restated from time to time.
ADDITIONAL COMMITMENT LENDER as defined in Section 2.1.2(ii).
ADJUSTED EBITDA. means, with respect to any fiscal period of the Borrower, on a
non- consolidated basis, (i) the Net Income, PLUS (ii) the amount of income tax
expense deducted in calculating net income for that period, MINUS (iii) the
amount of income taxes actually paid during that period, PLUS (iv) depreciation,
amortization and other non-cash items deducted in calculating Net Income for
that period, MINUS (v) non-cash revenue included in calculating Net Income for
that period, PLUS (vi) the amount of interest expense payable with respect to
Indebtedness (excluding, however, interest expense payable with respect to the
Facility) and deducted in calculating Net Income for that period. All
intercompany (among the Borrower and CM Corp.) transactions and allocations
shall be eliminated in computing the Borrower's EBITDA for any period.
ADVANCE RATE means, as to any type of Eligible Loan, the advance rate therefor
specified in EXHIBIT D.
AFFILIATE means, for any Person, any other Person directly or indirectly
controlling, controlled by, or under common control with, that Person. For the
purposes of this definition, "CONTROL" (including, with correlative meanings,
the terms "CONTROLLING," "CONTROLLED BY," AND "UNDER COMMON CONTROL WITH"), as
applied to any Person, means the possession, directly or indirectly, of the
power to direct or cause the direction of the management and policies of that
Person, whether through the ownership of, voting securities, by contract, or
otherwise.
AGENCY SECURITY means a Mortgage-backed Security issued or guaranteed by ▇▇▇▇▇▇
▇▇▇, ▇▇▇▇▇▇▇ Mac or ▇▇▇▇▇▇ Mae.
AGENT means Fleet National Bank, acting as agent for the Lenders.
AGREEMENT means this Amended and Restated Mortgage Warehousing Credit and
Security Agreement, as it hereafter may be amended, modified, supplemented, or
further restated from time to time.
AGREEMENT DATE means the date as of which the Original Agreement is dated.
APPROVED SERVICING RIGHTS APPRAISER means The Prestwick Mortgage Group or
another independent third party proposed by the Borrower and approved by the
Agent, in its discretion.
APPROVED CUSTODIAN means a pool custodian or other Person that Agent deems
acceptable, in its sole discretion, to hold Mortgage Loans for inclusion in a
Mortgage Pool or to hold Mortgage Loans as agent for an Investor that has issued
a Purchase Commitment for those Mortgage Loans.
ASSIGNMENT AND ACCEPTANCE as defined in Section 11.3.1.
ASSIGNED COLLATERAL DOCUMENTS means the Collateral Documents assigned to the
Agent for the ratable benefit of the Lenders which are required to be delivered
to the Agent pursuant to the terms hereof in connection with each Warehousing
Advance.
AUTHORIZED REPRESENTATIVES as defined in Section 4 and listed on SCHEDULE 4.
A-1
BOND WAREHOUSE CREDIT AND SECURITY AGREEMENT means that certain Tax-Exempt Bond
Line of Credit and Security Agreement dated as of March 26, 2003 by and among
Charter Mac Equity Issuer Trust, Fleet National Bank, in its capacity as
Administrative Agent, Wachovia Bank, National Association, as Syndication Agent,
Fleet Securities, Inc. and Wachovia Securities, Inc., as Co-Lead Arrangers, and
the lenders party thereto, as amended and in effect.
BUSINESS DAY means any day of the year on which offices of Fleet National Bank
are not required or authorized by law to be closed for business in Boston,
Massachusetts. If any day on which a payment is due is not a Business Day, then
the payment shall be due on the next day following which is a Business Day.
Further, if there is no corresponding day for a payment in the given calendar
month (i.e., there is no "February 30th"), the payment shall be due on the last
Business Day of the calendar month.
CASH COLLATERAL ACCOUNT means a demand deposit account maintained at the Agent,
in the Agent's name (as Agent for the Lenders) and designated for receipt of the
proceeds of the sale or other disposition of Collateral. As of the date hereof,
the Cash Collateral Account has an account number of 9419920632.
CASH EQUIVALENTS mean (i) securities issued or directly and fully guaranteed or
insured by the United States of America or any agency or instrumentality thereof
(provided that the full faith and credit of the United States of America is
pledged in support thereof) having maturities of not more than twelve months
from the date of acquisition ("GOVERNMENT OBLIGATIONS"), (ii) U.S. dollar
denominated (or foreign currency fully hedged) time deposits, certificates of
deposit, Eurodollar time deposits and Eurodollar certificates of deposit of (y)
any domestic commercial bank of recognized standing having capital and surplus
in excess of $250,000,000 or (z) any bank whose short-term commercial paper
rating from S&P is at least A-1 or the equivalent thereof or from ▇▇▇▇▇'▇ is at
least P-1 or the equivalent thereof (any such bank being an "Approved Bank"), in
each case with maturities of not more than 364 days from the date of
acquisition, (iii) commercial paper and variable or fixed rate notes rated A-1
(or the equivalent thereof) or better by S&P or P-1 (or the equivalent thereof)
or better by Moody's and maturing within twelve months of the date of
acquisition, (iv) repurchase agreements with a bank or trust company (including
a Lender) or a recognized securities dealer having capital and surplus in excess
of $500,000,000 for direct obligations issued by or fully guaranteed by the
United States of America, (v) obligations of any state of the United States or
any political subdivision thereof for the payment of the principal and
redemption price of and interest on which there shall have been irrevocably
deposited Government Obligations maturing as to principal and interest at times
and in amounts sufficient to provide such payment, (vi) auction preferred stock
rated in the highest short-term credit rating category by S&P or Moody's and
(vii) U.S. dollar denominated time and demand deposit accounts or money market
accounts with those domestic banks meeting the requirements of item (y) or (z)
of clause (ii) above and any other domestic commercial banks insured by the FDIC
with an aggregate balance not to exceed $100,000 in the aggregate at any time at
any such bank.
CHANGE IN CONTROL means the occurrence of any of the following with respect to
CharterMac: (i) any merger or consolidation of CharterMac with or into any
Person or any sale, transfer or other conveyance, whether direct or indirect, of
all or substantially all of the assets of CharterMac, on a consolidated basis,
in one transaction or a series of related transactions, if, immediately after
giving effect to such transaction, any Person or group of Persons (within the
meaning of Section 13 or 14 of the Securities Exchange Act) is or becomes the
beneficial owner (within the meaning of Rule 13d-3 promulgated by the Securities
and Exchange Commission under the Securities Exchange Act) of the common shares
representing a majority of the total voting power of the aggregate outstanding
securities of the transferee or surviving entity normally entitled to vote in
the election of directors, managers, or trustees, as applicable, of the
transferee or surviving entity, (ii) any Person or group of Persons (within the
meaning of Section 13 or 14 of the Securities Exchange Act) is or becomes the
beneficial owner (within the meaning of Rule 13d-3 promulgated by the Securities
and Exchange Commission under the Securities Exchange Act) of the common shares
representing a majority of total voting power of the aggregate outstanding
common shares of CharterMac normally entitled to vote in the election of
directors of CharterMac, (iii) during any period of 12 consecutive calendar
months, individuals who were directors or trustees of CharterMac on the first
day of such period (together with any new directors or trustees whose election
by the board of directors or board of trustees of CharterMac or whose nomination
for election by the stockholders of CharterMac was approved by a vote of a
majority of the directors or trustees then still in office who were either
directors at the beginning of such period or whose election or nomination for
election was previously so approved) cease for any reason to constitute a
majority of the board of directors of CharterMac, or (iv) the sale or
disposition, whether directly or indirectly, by CharterMac and/or its
Subsidiaries (whether pursuant to a single transaction or series of related
transactions) of tangible assets representing more than 25% of CharterMac's
A-2
Tangible Assets (as defined in CharterMac's Guaranty), as of the date of such
sale or disposition (other than sales of assets into securitization programs in
the ordinary course of CharterMac's business consistent with past practices;
provided, however, that such assets continue to be consolidated on CharterMac's
balance sheet in accordance with GAAP, and that CharterMac retains the residual
interest in the cash flow from such assets).
CHARTERMAC means CharterMac, a Delaware statutory trust, a Guarantor hereunder.
CHARTER MAC CAPITAL means Charter Mac Capital Company, LLC, a Delaware limited
liability company.
CLOSING DATE means the Agreement Date.
CM CORP. means Charter Mac Corporation, a Delaware corporation, a Guarantor
hereunder.
COLLATERAL as defined in Section 3.1.
COLLATERAL DOCUMENTS means, with respect to each Mortgage Loan, (a) the Mortgage
Note, the Mortgage and all other documents executed in connection with or
relating to the Mortgage Loan, (b) as applicable, the original lender's ALTA
Policy of Title Insurance or its equivalent, (c) documents evidencing the FHA
Commitment to Insure, if applicable, (d) the appraisal, the environmental
assessment, the engineering report, certificates of casualty or hazard
insurance, credit information on the maker of the Mortgage Note, (e) any other
document listed in EXHIBIT B, and (f) any other document that is customarily
desired for inspection or transfer incidental to the purchase of any Mortgage
Note by an Investor or that is customarily executed by the seller of a Mortgage
Note to an Investor.
COMMITMENT shall mean, with respect to each Lender, the amount set forth on
SCHEDULE 1 hereto as the amount of such Lender's commitment to make advances to
the Borrower, as may be amended from time to time by the Agent as provided in
Section 10.
COMMITMENT INCREASE as defined in Section 2.1.2(ii).
COMMITMENT INCREASE DATE as defined in Section 2.1.2(iii).
COMMITMENT INCREASE SUPPLEMENT as defined in Section 2.1.2(ii).
COMMITTED PURCHASE PRICE means for an Eligible Loan (a) the dollar price as set
forth in the Purchase Commitment or, if the price is not expressed in dollars,
the product of the Mortgage Note Amount multiplied by the price (expressed as a
percentage) as set forth in a Purchase Commitment for the Eligible Loan, or (b)
if the Eligible Loan is to be used to back an Agency Security, the product of
the Mortgage Note Amount multiplied by the price (expressed as a percentage) as
set forth in a Purchase Commitment for the Agency Security.
COMMITMENT PERCENTAGE means, with respect to each Lender, the percentage set
forth on SCHEDULE 1 hereto as such Lender's percentage of the aggregate
Commitments of all of the Lenders, as may be amended from time to time by the
Agent as provided in Section 11.
CONSTITUENT DOCUMENTS means, with respect to any Person, its articles or
certificate of incorporation, constitution, bylaws, partnership agreements,
organizational documents, limited liability company agreements, or such other
document as may govern such entity's formation or organization.
CONTRACTUAL OBLIGATION means, for any Person, any provision of any security
issued by that Person or of any material indenture, mortgage, deed of trust,
contract, undertaking, agreement, or other instrument to which such Person is a
party or by which it or any of its properties is bound or to which it or any of
its properties is subject.
DEBT SERVICE means for any fiscal period of the Borrower, the sum of (i) the
expenses of the Borrower for such period for interest payable with respect to
all Indebtedness (other than under the Facility), PLUS (ii) notwithstanding that
the Borrower may not have any liability therefor, interest expense for such
period under the Acquisition Facility and all fees paid on account of or with
A-3
respect thereto, PLUS (iii) principal payments made or required to be made on
account of Indebtedness (including, notwithstanding that the Borrower may not
have any liability therefor, principal installments from time to time payable
under the Acquisition Facility) for such period, in each case determined in
accordance with GAAP (as if, in the case of Acquisition Facility Debt Service
attributable to the Borrower for the purposes of the within definition, the
Borrower was liable therefor).
DEBT SERVICE COVERAGE RATIO means, for any fiscal period, the ratio of (i)
Adjusted EBITDA for such period, to (ii) the Debt Service for such period.
DEFAULT as defined in Section 9.1.
DEFAULT RATE as defined in Section 2.4.12.
DELINQUENT LENDER as defined in Section 11.2.8.
ELIGIBLE ASSIGNEE shall mean (a) a Lender, (b) an Affiliate of any Lender, and
(c) any other Person approved by the Agent.
ELIGIBLE LOAN means a Mortgage Loan that satisfies the conditions and
requirements of EXHIBIT D and other applicable provisions of this Agreement for
supporting a Warehousing Advance.
ELIGIBLE MORTGAGE POOL means a Mortgage Pool for which (a) an Approved Custodian
has issued its initial certification, (b) there exists a Purchase Commitment
covering the Agency Security to be issued on the basis of that certification and
(c) the Agency Security will be delivered to the Agent.
ERISA and ERISA PLAN each as defined in Section 6.9.
EVENT OF DEFAULT as defined in Section 9.1.
FACILITY as defined in Section 1.2.
FACILITY FEE as defined in Section 2.5.2.
FAIR MARKET VALUE means, at any time for an Eligible Loan or a related Agency
Security (if the Eligible Loan is to be used to back an Agency Security) as of
any date of determination, (a) the Committed Purchase Price if the Eligible Loan
is covered by a Purchase Commitment from ▇▇▇▇▇▇ ▇▇▇ or ▇▇▇▇▇▇▇ Mac or the
Eligible Loan is to be exchanged for an Agency Security and that Agency Security
is covered by a Purchase Commitment from an Investor, or (b) otherwise, the
market price for such Eligible Loan or Agency Security, determined by Agent
based on market data for similar Mortgage Loans or Agency Securities and such
other criteria as Agent deems appropriate in its sole discretion.
▇▇▇▇▇▇ MAE means the Federal National Mortgage Association, and any successor.
----------
▇▇▇▇▇▇ ▇▇▇ DUS MORTGAGE LOANS means a permanent mortgage on a multifamily
property originated under ▇▇▇▇▇▇ Mae's Delegated Underwriting and Servicing
Guide.
▇▇▇▇▇▇ ▇▇▇ LOAN LOSS RESERVES means reserves established by the Borrower to
absorb estimated future losses related to ▇▇▇▇▇▇ Mae DUS Mortgage Loans.
▇▇▇▇▇▇ ▇▇▇ RESERVE ACCOUNT means that certain lender reserve account established
in favor of ▇▇▇▇▇▇ Mae by the Borrower and maintained at US Bank pursuant to
that certain Delegated Underwriting and Servicing Reserve Agreement effective as
of August 10, 2004 by and among ▇▇▇▇▇▇ ▇▇▇, the Borrower and US Bank, as amended
and in effect.
A-4
FEDERAL FUNDS RATE means for any day, a fluctuating interest rate per annum
equal to the weighted average of the rates on overnight federal funds
transactions with members of the Federal Reserve System arranged by federal
funds brokers, as published for such day (or, if such day is not a Business Day,
for the next preceding Business Day) by the Federal Reserve Bank of New York, or
if such rate is not so published for any day that is a Business Day, the average
of the quotations for such day on such transactions received by the Agent from
three federal funds brokers of recognized standing selected by the Agent.
FEDERAL FUNDS BASE RATE means, as applicable to any Fixed Rate Advance, the rate
per annum announced by the Federal Reserve Bank on Monday of each calendar week
(or if any such Monday is not a Business Day, then the next Business Day), for
wholesale liabilities of like tenor to any proposed or existing Fixed Rate
Advance, adjusted for reserve requirements and such other requirements as may be
imposed by federal, state or local governmental regulatory agencies, as
determined by the Agent, provided, however, for purposes of calculating the
Fixed Rate hereunder, the aforementioned rate announced on Tuesday of each week
shall be the effective rate, for purposes of calculating the Fixed Rate, as of
the Monday immediately preceding such Tuesday.
FEDERAL FUNDS RATE ADJUSTMENT DATE, means, each Monday of each calendar week,
provided however, if any Monday is not a Business Day, the Federal Funds Rate
Adjustment Date shall be the next Business Day. On each Federal Funds Rate
Adjustment Date, the then current Fixed Rate for all outstanding Fixed Rate
Advances shall be adjusted to reflect the Federal Funds Base Rate in effect as
of said Federal Funds Rate Adjustment Date, and any new Fixed Rate Advances
shall accrue interest at the Fixed Rate based upon the Federal Funds Base Rate
as of the most recent Federal Funds Rate Adjustment Date.
FEE LETTER means that certain fee letter dated on or about the Agreement Date
between the Borrower and the Agent, as the same may be modified, amended,
supplemented or restated from time to time.
FHA means the Federal Housing Administration and any successor agency or other
entity.
FHA CONSTRUCTION MORTGAGE LOAN has the meaning set forth in EXHIBIT D.
FHA PROJECT MORTGAGE LOAN has the meaning set forth in EXHIBIT D.
FIRST MORTGAGE means a Mortgage that constitutes a first Lien on the real
property covered by the Mortgage.
FIRST MORTGAGE LOAN means a Mortgage Loan secured by a First Mortgage.
FIXED RATE means the per annum rate equal to the Federal Funds Base Rate plus
100 basis points, with changes in the Federal Funds Rate, if any, to be
effective as of each Federal Funds Rate Adjustment Date.
FIXED RATE ADVANCE means any Warehousing Advance outstanding under this
Agreement which bears interest at the Fixed Rate.
FLEET FINANCING means any loan, provision of credit or other financial
accommodation of any kind to any of RCC, CharterMac, CharterMac Capital or CM
Corp., or any of their respective Affiliates (other than members of the
Management Group) to which Fleet National Bank or any of its Affiliates is a
party, including without limitation, the Acquisition Facility, the Letter of
Credit Facility, the Bond Warehouse Credit and Security Agreement and the RCC
Warehouse Loan Agreement.
FORWARD COMMITMENTS means mortgage loans which ▇▇▇▇▇▇ Mae has committed to
purchase in accordance with the requirements of ▇▇▇▇▇▇ Mae's product, subject to
satisfaction of specified underwriting conditions.
▇▇▇▇▇▇▇ MAC means the Federal Home Loan Mortgage Corporation, and any successor.
FUTURE COMMITMENT as defined in Section 11.2.8.
▇-▇
▇▇▇▇ means principles that are consistent with the principles promulgated or
adopted by the Financial Accounting Standards Board and its predecessors, as in
effect from time to time.
GENERAL INTANGIBLES has the meaning given that term in the UCC.
GESTATION AGREEMENT means an agreement under which the Borrower agrees to sell
or finance (a) a Mortgage Loan prior to the date of purchase by an Investor or
(b) a Mortgage Pool prior to the date a Mortgage-backed Security backed by the
Mortgage Pool is issued.
▇▇▇▇▇▇ ▇▇▇ means the Government National Mortgage Association, an agency of the
United States government, and any successor agency or other entity.
GOVERNMENTAL AUTHORITY means any nation or government, any state or other
political subdivision thereof, and any Person exercising executive, legislative,
judicial, regulatory, or administrative functions of or pertaining to
government.
GOVERNMENTAL AUTHORIZATION means any permit, license, authorization, plan,
directive, consent order, or consent decree of or from any Governmental
Authority.
GUARANTOR(S) means, singly and collectively, each of CharterMac, a Delaware
statutory trust, and Charter Mac Corporation, a Delaware corporation, of which
the Borrower is a subsidiary.
GUARANTY(IES) mean each Guarantor's Guaranty of even date herewith, as the same
may hereafter be modified, amended or restated.
HEDGING ARRANGEMENT means an arrangement designed to protect a Person from
fluctuations in interest rates or asset values and not acquired by a Person for
speculation.
HUD means the Department of Housing and Urban Development, and any successor
agency or other entity.
INCREMENTAL LOAN COMMITMENT REQUIREMENTS means, with respect to any request for
a Commitment Increase made pursuant to Section 2.1.2, or any provision of a
Commitment Increase on a given Commitment Increase Date, the satisfaction of
each of the following conditions: (i) no Default then exists or would result
therefrom (including on a pro forma basis relative to financial covenant
compliance), (ii) the Borrower shall have certified to the Agent that the
incurrence of Indebtedness in an aggregate principal amount equal to the full
amount of the Commitment Increase then requested or provided would not cause a
breach of, or a default under, any agreement to which the Borrower is a party,
(iii) all representations and warranties and covenants of the Borrower contained
in this Agreement or the other Loan Documents shall be true as of the date as of
which it was made and shall also be true at and as of the date of such request
or Commitment Increase Date, as the case may be (after giving effect to the
incurrence of any Warehousing Advances at such time), except to the extent of
changes resulting from transactions contemplated and permitted by this Agreement
and the other Loan Documents and changes occurring in the ordinary course of
business that singly or in the aggregate are not materially adverse, or except
to the extent that such representations and warranties relate expressly to an
earlier date, and (iv) the delivery by the Borrower of an officer's certificate
to the Agent certifying as to compliance with the preceding clauses (i), (ii),
and (iii).
INDEBTEDNESS means all obligations, contingent and otherwise, that in accordance
with GAAP should be classified upon the consolidated balance sheet of the
Borrower and the Borrower's Subsidiaries as liabilities, or to which reference
should be made by footnotes thereto, including in any event and whether or not
so classified: (a) all obligations for borrowed money or other extensions of
credit whether or not secured or unsecured, absolute or contingent, including,
without limitation, unmatured reimbursement obligations with respect to letters
of credit or guarantees issued for the account of or on behalf of the Borrower
and its Subsidiaries and all obligations representing the deferred purchase
price of property, (b) all obligations evidenced by bonds, notes, debentures or
other similar instruments; (c) all liabilities secured by any mortgage, pledge,
security interest, lien, charge, or other encumbrance existing on property owned
or acquired subject thereto, whether or not the liability secured thereby shall
have been assumed; and (d) all guarantees, endorsements and other contingent
A-6
obligations whether direct or indirect in respect of indebtedness of others or
otherwise, including any obligations with respect to puts, swaps, and other
similar undertakings, any obligation to supply funds to or in any manner to
invest in, directly or indirectly, the debtor, to purchase indebtedness, or to
assure the owner of indebtedness against loss, through an agreement to purchase
goods, supplies, or services for the purpose of enabling the debtor to make
payment of the indebtedness held by such owner or otherwise, and the obligations
to reimburse the issuer in respect of any letters of credit; and (e) that
portion of all obligations arising under capital leases that is required to be
capitalized on the consolidated balance sheet of the Borrower and its
Subsidiaries; but excluding, in all events obligations arising under operating
leases and accounts payable arising in the ordinary course of business.
INDEMNIFIED PARTY as defined in Section 7.25.
INVESTMENT shall mean the acquisition of any real or tangible personal property
or of any stock or other security, any loan, advance, bank deposit, money market
fund, contribution to capital, extension of credit (except for accounts
receivable arising in the ordinary course of business and payable in accordance
with customary terms) , or purchase or commitment or option to purchase or
otherwise acquire real estate or tangible personal property or stock or other
securities of any party or any part of the business or assets comprising such
business, or any part thereof.
INVESTOR means ▇▇▇▇▇▇ Mae, ▇▇▇▇▇▇▇ Mac or a financially responsible private
institution that Lender deems acceptable, in its sole discretion, to issue
Purchase Commitments with respect to a particular category of Eligible Loans.
LATE CHARGES as defined in Section 2.4.13.
LEGAL REQUIREMENTS shall mean all applicable federal, state, county and local
laws, by-laws, rules, regulations, codes and ordinances, and the requirements of
any governmental agency or authority having or claiming jurisdiction with
respect thereto, including, but not limited to, those applicable to any Pledged
Assets, ▇▇▇▇▇▇ Mae, FHA, ▇▇▇▇▇▇▇ Mac, ▇▇▇▇▇▇ ▇▇▇, zoning, subdivision, building,
health, fire, safety, sanitation, the protection of the handicapped, and
environmental matters and shall also include all orders and directives of any
court, governmental agency or authority having or claiming jurisdiction with
respect thereto.
LENDERS means, on any date of determination, the financial institutions named on
SCHEDULE 1, and, subject to the terms and conditions of this Agreement, their
respective successors and assigns.
LETTER OF CREDIT FACILITY. That certain letter of credit facility dated December
10, 2002, by and among, the Agent, Fleet National Bank as a Lender and
CharterMac, and any modifications, amendments, or restatements thereof.
LIEN means any lien, mortgage, deed of trust, pledge, security interest, charge
or encumbrance of any kind (including any conditional sale or other title
retention agreement, any lease in the nature of such an agreement and any
agreement to give any security interest).
LIQUIDATION PROCEEDS means amounts received by the Agent and/or the Lenders in
the exercise of the rights and remedies under the Loan Documents.
LOAN as defined in Section 2.1.1.
LOAN DOCUMENTS as defined in Section 3.7.
MANAGEMENT GROUP means the following three individuals, who maintain management
and operational control of Related Capital Company, LLC: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇▇▇
▇. ▇▇▇▇▇▇ and ▇▇▇▇ ▇. Schnitizer.
MATURITY DATE means the earlier of February 28, 2006 or the date upon which the
whole of the Commitments are terminated or the Loan is accelerated in accordance
with applicable provisions of this Agreement.
MORTGAGE means a mortgage or deed of trust on real property that is improved and
substantially completed.
A-7
MORTGAGE-BACKED SECURITIES means securities that are secured or otherwise backed
by Mortgage Loans .
MORTGAGE LOAN means any loan evidenced by a Mortgage Note and secured by a
Mortgage.
MORTGAGE NOTE means a promissory note secured by one or more Mortgages.
MORTGAGE NOTE AMOUNT means, as of any date of determination, the then
outstanding and unpaid principal amount of a Mortgage Note (whether or not an
additional amount is available to be drawn under that Mortgage Note).
MORTGAGE POOL means a pool of one or more Pledged Loans on the basis of which a
Mortgage-backed Security is to be issued.
MULTIFAMILY PROPERTY means real property that contains or that will contain more
than 4 dwelling units.
NET INCOME means with respect to any fiscal period, the net income (or deficit)
of the Borrower on a non-consolidated basis after deduction of all expenses,
taxes, and other proper charges, determined in accordance with GAAP.
NOTES means the promissory notes of the Borrower, substantially in the form of
EXHIBIT F hereto, evidencing the obligation of the Borrower to repay the Loan,
and all renewals and extensions of all or any part thereof.
NOTICE as defined in Section 12.1.
NOTICE OF RATE SELECTION as defined in Section 2.4.3.
OBLIGATIONS The Facility and the Loan together with interest thereon and all
other charges, fees and amounts payable by, and all other obligations of, the
Borrower to the Agent and the Lenders, including, without limitation, whenever
incurred, direct or indirect, absolute or contingent.
OPERATING ACCOUNT means a demand deposit account maintained at the Agent in the
Borrower's name to be charged from time to time for payment of the Obligations,
and designated for funding that portion of each Eligible Loan not funded by a
Warehousing Advance made against that Eligible Loan and for returning any excess
payment from an Investor for a Pledged Asset.
ORIGINAL AGREEMENT as defined in Section 1.2.
PBGC means the Pension Benefit Guaranty Corporation created by ss.4002 of ERISA
and any successor entity or entities having similar responsibilities.
PERMITTED INTERCOMPANY SUBORDINATED DEBT means indebtedness owed by the Borrower
and/or one or more of its Subsidiaries to an Affiliate (other than one another),
which indebtedness has a maturity date which is later than the Maturity Date,
and which is subordinate to the Obligations pursuant to a subordination
agreement reasonably satisfactory to the Agent.
PERMITTED DISTRIBUTIONS as defined in Section 7.15.
PERSON means any individual, corporation, partnership, trust, limited liability
company, unincorporated association, business, or other legal entity, and any
government or any governmental agency or political subdivision thereof.
PLEDGED ASSETS means, collectively, Pledged Loans, and Pledged Securities.
PLEDGED HEDGING ACCOUNT as defined in Section 3.1.8.
PLEDGED HEDGING ARRANGEMENT as defined in Section 3.1.8.
A-8
PLEDGED LOANS has the meaning set forth in Section 3.1.2.
PLEDGED SECURITIES has the meaning set forth in Section 3.1.3.
PRIME RATE The term "Prime Rate" means the per annum rate of interest so
designated from time to time by Fleet National Bank as its prime rate. The Prime
Rate is a reference rate and does not necessarily represent the lowest or best
rate being charged to any customer.
PROPERTY means a Multifamily Property securing a Mortgage Loan.
PURCHASE COMMITMENT means a written commitment, in form and substance
satisfactory to Agent, issued in favor of any the Borrower by an Investor under
which that Investor commits to purchase Mortgage Loans or Mortgage-backed
Securities.
RATING AGENCIES means Standard & Poor's, Moodys, or any other nationally
recognized Person reasonably acceptable to Agent in the business of rating
creditworthiness.
RCC WAREHOUSE LOAN AGREEMENT means that certain Eighth Amended and Restated Loan
Agreement dated as of October 29, 2004 by and among RCC Credit Facility, L.L.C.,
a Delaware limited liability company, as borrower, and Related Capital Company
LLC, a Delaware limited liability company and the Guarantors, as guarantors, and
Fleet National Bank as Agent and such lenders.
RECEIVABLES as defined in Section 3.1.8.
REGISTER as defined in Section 11.3.3.
RELEASE AMOUNT as defined in Section 3.3.6.
REPORTABLE EVENT as defined in Section 6.9.
REQUISITE LENDERS as of any date, (i) if there are two (2) or fewer Lenders
holding Commitments, Requite Lenders shall mean all such Lenders, or (ii) if
there are three (3) or more Lenders holding Commitments, Requisite Lenders shall
mean the Lenders holding at least sixty-five percent (65%) of the outstanding
principal amount of the Loans on such date; and if no such principal is
outstanding, the Lenders whose aggregate Commitments constitute at least
sixty-five percent (65%) of the Total Commitment.
SECURITY DOCUMENTS as defined in Section 3.7.
SECOND MORTGAGE means a Mortgage that constitutes a second Lien on the property
covered by the Mortgage.
SECOND MORTGAGE LOAN means a Mortgage Loan secured by a Second Mortgage.
SECURITY means
SELLING STOCKHOLDERS means those Persons constituting the "Stockholders" as that
term is defined in the Stock Purchase Agreement.
SERVICED LOANS means each of those loans secured by a mortgage lien on a
multi-family residential property, health care facility, senior citizen facility
or other property, with respect to which the Borrower provides servicing or
subservicing (but only if such subservicing is technically styled as
subservicing but is performed under a contract directly between the Borrower and
▇▇▇▇▇▇ Mae, ▇▇▇▇▇▇▇ Mac or ▇▇▇▇▇▇ Mae) pursuant to a Servicing Contract.
SERVICING CONTRACT means each direct agreement with the owner of the subject
Serviced Loans, as it may be amended from time to time, pursuant to which the
Borrower services Serviced Loans.
A-9
SERVICING PORTFOLIO means the portfolio of Servicing Contracts pursuant to which
the Borrower has the rights to service Serviced Loans.
SERVICING RIGHTS means all rights of the Borrower as a servicing or subservicing
(but only if such subservicing is technically styled as subservicing but is
performed under a contract directly between the Borrower and ▇▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇
Mac or ▇▇▇▇▇▇ Mae) of Serviced Loans.
STATEMENT as defined in Section 12.15.
STOCK PURCHASE AGREEMENT means that certain Stock Purchase Agreement dated as of
October 24, 2001, by and among the Charter Mac Corporation and the Borrower's
Stockholders, as amended by a certain First Amendment to Stock Purchase
Agreement dated November 21, 2001, and by a certain Second Amendment to Stock
Purchase Agreement dated December 24, 2001, and including all schedules and
exhibits thereto.
SUBSIDIARY means any corporation, association, partnership, trust, or other
business entity of which the designated parent shall at any time own directly or
indirectly through a Subsidiary or Subsidiaries at least a majority (by number
of votes or controlling interests) of the outstanding voting interests of such
entity.
TANGIBLE NET WORTH means, as to the Borrower (on a non-consolidated basis), as
of the date of determination, the excess of such Persons' Total Assets over
Total Liabilities, MINUS intangible assets, PLUS, to the extent not otherwise
included in determining "Tangible Net Worth" (i) ▇▇▇▇▇▇ ▇▇▇ Loan Loss Reserves,
(ii) Servicing Contracts valued at the lesser of book value or fair market
value, and (iii) any Permitted Intercompany Subordinated Debt. For purposes of
calculating the Tangible Net Worth of the Borrower and its Subsidiaries,
advances or loans to shareholders, directors, officers, employees or Affiliates,
investments in Affiliates, assets pledged to secure any liabilities not included
in the Indebtedness of such Persons, intangible assets, those other assets that
would be deemed by HUD to be non-acceptable in calculating adjusted net worth in
accordance with its requirements in effect as of that date, as those
requirements appear in "Consolidated Audit Guide for Audits of HUD Programs,"
and other assets Agent deems unacceptable, in its sole discretion, shall be
excluded from such Persons Total Assets.
THIRD MORTGAGE means a Mortgage that constitutes a third Lien on the property
covered by the Mortgage.
THIRD MORTGAGE LOAN means a Mortgage Loan secured by a Third Mortgage.
THIRD PARTY ORIGINATED LOAN means a Mortgage Loan originated and funded by a
third party (other than with funds provided by the Borrower at closing to
purchase the Mortgage Loan) and subsequently purchased by the Borrower.
TOTAL ASSETS means, at the time of determination, all assets of the Borrower (on
a non-consolidated basis) determined in accordance with GAAP applied in a manner
consistent with the most recent audited financial statements delivered pursuant
to the Agreement.
TOTAL COMMITMENT The sum of the Commitments of the Lenders, as in effect from
time to time.
TOTAL LIABILITIES means as to the Borrower (on a non-consolidated basis), as of
the date of determination, all liabilities of the Borrower determined in
accordance with GAAP applied in a manner consistent with the most recent audited
financial statements delivered pursuant to the Agreement and all indebtedness
and contingent obligations of Borrower (on a consolidated basis among
themselves), whether or not so classified, including all redemption obligations,
hedging liabilities, and off-balance sheet financial transactions as to which
there is recourse to the Borrower.
TRUST RECEIPT means a trust receipt in a form approved by and under which Lender
may deliver any document relating to the Collateral to the Borrower for
correction or completion.
UCC means the Uniform Commercial Code in effect in the Commonwealth of
Massachusetts, or any other applicable jurisdiction.
A-10
VARIABLE RATE The term "Variable Rate" means a per annum rate equal at all times
to the Prime Rate plus 12.5 basis points, with changes therein to be effective
simultaneously with any change in the Prime Rate.
VARIABLE RATE ADVANCE The term "Variable Rate Advance" means any principal
amount outstanding under this Agreement which pursuant to this Agreement bears
interest at the Variable Rate.
WAREHOUSING ADVANCE means a disbursement by the Lenders under the Facility.
WAREHOUSING ADVANCE REQUEST as defined in Section 2.3.1.
WAREHOUSING COLLATERAL VALUE means, as of any date of determination, (a) with
respect to any Eligible Loan, the lesser of (1) the amount of the Warehousing
Advance permitted against such Eligible Loan under EXHIBIT D or (2) the Fair
Market Value of such Eligible Loan; and (b) if Eligible Loans have been
exchanged for Agency Securities, the lesser of (1) the amount of any Warehousing
Advances outstanding against the Eligible Loans backing the Agency Securities or
(2) the Fair Market Value of the Agency Securities.
WAREHOUSING COMMITMENT means the obligation of Lenders to make Warehousing
Advances or to the Borrower under Section 2.1.1.
WAREHOUSE COMMITMENT AMOUNT means $100,000,000, as such amount may be increased
pursuant to Section 2.1.2.
WAREHOUSE LOANS means each of (i) those closed loans held by the Borrower
secured by a mortgage lien on a multifamily Property, (ii) those pending loans
as to which (a) the Borrower has given a commitment to lend or has committed to
purchase at a specified interest rate other than Forward Commitments or (b) a
▇▇▇▇▇▇▇ Mac loan commitment at a specified interest rate has been executed by
▇▇▇▇▇▇▇ Mac and the borrower.
A-11
EXECUTION COUNTERPART
AMENDMENT NO. 1
---------------
TO
--
AMENDED AND RESTATED MORTGAGE WAREHOUSING
-----------------------------------------
CREDIT AND SECURITY AGREEMENT
-----------------------------
THIS AMENDMENT NO. 1 (this "Amendment") is entered into as of July 28,
2005, among CHARTERMAC MORTGAGE CAPITAL CORPORATION, a Delaware corporation, as
Borrower, and BANK OF AMERICA, N.A. (successor by merger to Fleet National Bank)
as a Lender ("BofA") and as agent (in such capacity, the "Agent") for itself and
the other Lenders, and such other Lenders; and CharterMac, a Delaware statutory
trust, and Charter Mac Corporation, a Delaware corporation (each individually, a
"Guarantor," and collectively "the Guarantors").
RECITALS
--------
Reference is made to the following facts that constitute the background of
this Amendment:
A. The Borrower, the Agent and the Lenders entered into that certain
Amended and Restated Mortgage Warehousing Credit and Security
Agreement, dated as of March 18, 2005 (as amended from time to time,
the "Agreement"). Capitalized terms used herein and not otherwise
defined herein shall have the same meanings herein as ascribed to them
in the Agreement.
B. The Borrower and the Guarantors have requested that, for a period of
37 days from the date hereof (the "Increase Period"), in the event the
principal amount of the Loan then outstanding exceeds the Warehouse
Commitment Amount, BofA fund Warehousing Advances up to (i)
$125,000,000.00 greater than the Warehousing Commitment Amount during
the first 30 days of the Increase Period, and (ii) $25,000,000.00
greater than the Warehousing Commitment Amount during the last 7 days
of the Increase Period (such $125,000,000 and $25,000,000 amounts
referred to herein as the "Maximum Overadvance Amount").
C. The Agent and the Lenders are willing to amend the Agreement to
accommodate such request solely upon the terms and conditions set
forth in this Amendment.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:
1. THIRTY SEVEN DAY AMENDMENT. Except as specifically provided for herein,
terms of this Amendment will be effective solely for the duration of the
Increase Period. At the end of the Increase Period, except as specifically
provided for herein, this Amendment will be of no further force or effect, and
the terms of the Loan Agreement in effect in the absence of this Amendment will
be reinstated in full. The parties hereto hereby acknowledge and agree that the
Increase Period shall expire at 5:00 p.m. EDT on September 2, 2005.
2. TEMPORARY INCREASE IN THE LOAN.
------------------------------
2.1 OVERADVANCES. Subject to the terms and conditions of the Agreement, and
provided there is not then in existence a Default, (i) in the event that a
Warehousing Advance Request is received at such time as the aggregate principal
balance of the Loan then outstanding equals or exceeds the Warehousing
Commitment Amount, BofA agrees to fund 100% of such Warehousing Advance so
requested; and (ii) in the event a Warehousing Advance made pursuant to a
Warehousing Advance Request would cause the principal amount of the Loan then
outstanding to exceed the Warehousing Commitment Amount, BofA agrees to fund
100% of the portion of such Warehousing Advance that causes the then outstanding
principal balance of the Loan to exceed the Warehousing Commitment Amount; (each
such advance contemplated by clause (i) or portion thereof contemplated by
clause (ii), an "Overadvance"). BofA shall not be obligated to make all or any
portion of a requested Overadvance in the event, and to the extent, that the
making of such requested Overadvance would cause the aggregate principal amount
of all Overadvances then outstanding to exceed the then applicable Maximum
Overadvance Amount.
2.2 REPAYMENT OF OVERADVANCES. At any time any Overadvance or portion
thereof continues to be outstanding, any payment that is received by the Agent
or a Lender that is to be applied to reduce the then outstanding principal
balance of the Loan in accordance with the terms of the Agreement shall be paid
to BofA first to reduce or eliminate the then outstanding aggregate principal
balance of the Overadvances.
3. AMENDMENTS TO THE AGREEMENT.
---------------------------
3.1 AMENDMENT TO SECTION 2.1.1 OF THE AGREEMENT. Section 2.1.1 of the
Agreement is hereby amended by deleting the sentence "The aggregate
principal amount of the Loan outstanding at any one time may not
exceed the Warehousing Commitment Amount." and substituting the
following in its stead:
"The aggregate principal amount of the Loan outstanding at any
one time may not exceed the Warehousing Commitment Amount plus
the then applicable Maximum Overadvance Amount."
3.2 AMENDMENT TO SECTION 2.1.2 OF THE AGREEMENT. Section 2.1.2 of the
Agreement is hereby amended by deleting the introductory sentence and
substituting the following in its stead:
"2.1.2 MAXIMUM AMOUNT OF FACILITY. Subject to the applicable
terms and conditions of this Agreement, the maximum principal
amount outstanding under the Facility shall not exceed (i)
$225,000,000.00 during the period from the date hereof through
August 26, 2005, and (ii) $125,000,000 during the period from
August 27, 2005 through September 2, 2005."
3.3 AMENDMENT TO SECTION 2.1.4 OF THE AGREEMENT. Section 2.1.4 of the
Agreement is hereby amended by deleting it in its entirety and
substituting the following in its stead:
"2.1.4 OUTSTANDING BALANCE OF THE LOAN. In the event at any time
the outstanding principal balance of the Loan should exceed the
lesser of (x) the Warehousing Commitment Amount plus the Maximum
Overadvance Amount, or (y) the aggregate Warehousing Collateral
Value of all Eligible Loans against which Warehousing Advances
are then outstanding, the Borrower shall repay such excess amount
on demand to the Agent so that the outstanding principal balance
of the Facility is in compliance with the terms and provisions
hereof."
3.4 AMENDMENT TO EXHIBIT A TO THE AGREEMENT. The terms of this Section 3.4
shall survive the expiration of the Increase Period. The definition of
"Warehouse Commitment Amount" in Exhibit A to the Agreement is hereby
amended by deleting it in its entirety and substituting the following
in its stead:
"WAREHOUSING COMMITMENT AMOUNT means $100,000,000.00, as such
amount may be increased pursuant to Section 2.1.2."
4. FEES.
----
4.1 LOAN FEES. The Borrower shall pay a commitment fee to BofA for the
period commencing on the date hereof and ending at the end of the Increase
Period equal to $10,753.42.
4.2 OVERADVANCE FACILITY FEE. The Borrower agrees to pay a facility fee to
Agent on behalf of BofA on the average daily unborrowed portion of the Maximum
Overadvance Amount from the date hereof through September 2, 2005 (the
"Overadvance Facility Fee"), calculated as set forth below. The Overadvance
Facility Fee shall be payable in arrears on September 5, 2005 for the preceding
thirty seven day period ending on September 2, 2005, and shall be calculated by
multiplying the average daily unborrowed portion of the Maximum Overadvance
Amount for such thirty seven day period by 0.025% percent, and multiplying that
product by a fraction, the numerator of which is thirty seven days, and the
denominator of which is ninety (90) days. The Borrower shall not be entitled to
2
any credit, rebate or repayment of the Overadvance Facility Fee notwithstanding
any termination of this Amendment or the Agreement or suspension or termination
of the Agent's or any Lender's respective obligation to make Warehousing
Advances or Overadvances hereunder.
5. RATIFICATION OF LOAN DOCUMENTS; ACKNOWLEDGMENTS. Except as provided herein,
all terms and conditions of the Agreement and the other Loan Documents remain in
full force and effect. The Borrower hereby:
5.1. Ratifies, confirms, and reaffirms all representations, warranties, and
covenants contained in the Agreement and in the Loan Documents (except for
changes that are not singly or in the aggregate materially adverse resulting
from transactions contemplated and permitted by the Loan Agreement and the other
Loan Documents, and changes occurring in the ordinary course of business that
singly or in the aggregate are not materially adverse, and except that
representations and warranties relating expressly to an earlier date are
reaffirmed as of such date) and acknowledges and agrees that the Obligations,
including, without limitation, on account of any Overadvances, are and continue
to be secured by the Collateral.
5.2. Acknowledges and agrees that the Borrower does not have any offsets,
defenses, or counterclaims against the Agent or any Lender thereunder, and to
the extent that any such offsets, defenses, or counterclaims may exist, the
Borrower hereby WAIVES and RELEASES the Agent and Lenders therefrom.
5.3. Represents and warrants that:
a. As of the date the Borrower executes this Amendment, no
Default exists, nor will a Default exist as of the effective date of
this Amendment.
b. This Amendment has been duly executed and delivered on behalf
of the Borrower, and constitutes the legal, valid and binding
obligation of the Borrower, enforceable against the Borrower in
accordance with its terms, subject to the effect of applicable
bankruptcy and other similar laws affecting the rights of creditors
generally and to the effect of equitable principles whether applied in
an action at law or a suit in equity.
6. GUARANTY. The Guarantors hereby reaffirm their respective Guaranties, and
agree that neither the execution of this Amendment, the performance or
consummation of any of the transactions contemplated hereby, or any subsequent
modification, extension, renewal, amendment, supplement or restatement of the
Agreement, including any increase or reduction in the Total Commitments (or any
Lender's Commitment), shall in any way limit, restrict, qualify, or extinguish
their liability under the terms of their respective Guaranties, whether or not
either Guarantor executes a confirmation of its Guaranty in connection with any
such subsequent modification, extension, renewal, amendment, supplement or
restatement, or increase or reduction.
7. CONDITIONS PRECEDENT. This Amendment shall not be effective until each of the
following conditions precedent have been fulfilled to the satisfaction of the
Agent and the Lenders:
7.1. This Amendment shall have been duly executed and delivered by the
respective parties hereto (including the Guarantors for the purposes of Section
6 hereof) and shall be in full force and effect.
7.2. The allonge to the Promissory Note, dated as of March 18, 2005, made
by the Borrower, payable to the order of Fleet National Bank, in the principal
face amount of $175,000,000.00, substantially in the form of EXHIBIT 7.2 to this
Amendment (the "Allonge"), shall have been duly executed and delivered by the
Borrower to BofA, and shall be in full force and effect.
7.3. All action on the part of the Borrower necessary for the valid
execution, delivery and performance by the Borrower of this Amendment and the
Allonge shall have been duly and effectively taken and evidence thereof
satisfactory to the Agent shall have been provided to the Agent.
3
7.4. All action on the part of the Guarantors necessary for the valid
execution, delivery and performance by the Guarantors of this Amendment shall
have been duly and effectively taken and evidence thereof satisfactory to the
Agent shall have been provided to the Agent.
7.5. The Borrower shall have provided such other items to the Agent as are
set forth on the Closing Agenda attached as EXHIBIT 7.5 to this Amendment, and
such additional instruments and documents to the Agent as the Agent and the
Agent's counsel may have reasonably requested.
7.6. No Default shall have occurred and be continuing.
8. GENERAL.
-------
8.1 COUNTERPARTS. This Amendment may be executed and delivered in any
number of counterparts with the same effect as if the signatures hereto and
thereto were upon the same instrument.
8.2 AMENDMENT AS LOAN DOCUMENT. Each party hereto agrees and acknowledges
that this Amendment constitutes a "Loan Document" under and as defined in the
Agreement.
8.3 GOVERNING LAW. THIS AMENDMENT SHALL IN ALL RESPECTS BE GOVERNED,
CONSTRUED, APPLIED AND ENFORCED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE
COMMONWEALTH OF MASSACHUSETTS WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAWS.
8.4 SUCCESSORS AND ASSIGNS. This Amendment shall be binding upon each of
the Borrower, the Guarantors, the Lenders and the Agent and their respective
successors and assigns, and shall inure to the benefit of each of the Borrowers,
the Guarantors, the Lenders and the Agent.
8.5 HEADINGS. Section headings in this Amendment are included herein for
convenience of reference only and shall not constitute a part of this Amendment
for any other purpose.
8.6 INTEGRATION. This Amendment (and documents contemplated by the Closing
Checklist) contains the entire understanding of the parties hereto with regard
to the subject matter contained herein. This Amendment supersedes all prior or
contemporaneous negotiations, promises, covenants, agreements and
representations of every nature whatsoever with respect to the matters referred
to in this Amendment, all of which have become merged and finally integrated
into this Amendment. Each of the parties hereto understands that in the event of
any subsequent litigation, controversy or dispute concerning any of the terms,
conditions or provisions of this Amendment, no party shall be entitled to offer
or introduce into evidence any oral promises or oral agreements between the
parties relating to the subject matter of this Amendment not included or
referred to herein and not reflected by a writing included or referred to
herein.
8.7 NO COURSE OF DEALING. The Agent and the Lenders have entered into this
Amendment on the express understanding with the Borrower and each Guarantor that
in entering into this Amendment the Agent and the Lenders are not establishing
any course of dealing with the Borrower and the Guarantors. The Agent's and the
Lenders' right to require strict performance with all of the terms and the
conditions of Agreement and the other Loan Documents shall not in any way be
impaired by the execution of this Amendment. None of the Agent and the Lenders
shall be obligated in any manner to execute any further amendments or waivers
and if such waivers or amendments are requested in the future, assuming the
terms and conditions thereof are satisfactory to them, the Agent and the Lenders
may require the payment of fees in connection therewith.
[Remainder of the page intentionally left blank]
4
IN WITNESS WHEREOF, the undersigned have duly executed this Amendment under
seal as of the date first set forth above.
BORROWER:
CHARTERMAC MORTGAGE CAPITAL CORPORATION
By: /s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
------------------
Name: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
--------------
Title: Senior Vice President
---------------------
LENDERS:
BANK OF AMERICA, N.A., as Agent and
as a Lender
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇
-----------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇
-------------
Title: Senior Vice President
---------------------
HSBC BANK USA, NATIONAL ASSOCIATION,
as a Lender
By: /s/ ▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
---------------------------
Name: ▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
-----------------------
Title: Vice President
--------------
[Signatures continued on next page]
(1st Amendment Sig. Pg)
Accepted and Agreed:
CHARTER MAC CORPORATION, as Guarantor
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------
Title: Chief Operating Officer
-----------------------
CHARTERMAC, as Guarantor
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------
Title: Chief Operating Officer
-----------------------
(Amendment No. 1 Sig Pg.)
EXHIBIT 7.2
-----------
ALLONGE NO. 1
DATED AS OF JULY___, 2005
This Allonge is made to that certain Promissory Note, dated as of March 18,
2005, made by the Borrower, and payable to Bank of America, N.A. (successor by
merger to Fleet National Bank), in the original principal amount of
$50,000,000.00 (the "Note"). Terms not defined herein have the same meanings as
in the Note.
Solely for the thirty seven-day period commencing as of the date hereof and
ending at 5:00 p.m. EDT on September 2, 2005 (the "Increase Period"), the
principal amount of the Note shall be increased from $50,000,000.00 to (i)
$175,000,000.00 through August 26, 2005, and (ii) $75,000,000 during the period
from August 27, 2005 through September 2, 2005. During the Increase Period this
Allonge shall become part of the Note and shall be subject to all of the terms
and conditions thereof. From and after the expiration of the Increase Period,
this Allonge shall be of no further force and effect and the Note shall remain
in full force and effect without reference to this Allonge.
Although it is in the interest of the parties that this Allonge be affixed
to the Note, this Allonge shall continue in full force and effect even if it has
not been so affixed.
This instrument shall have the force and effect of an instrument executed
under seal under the laws of The Commonwealth of Massachusetts (without regard
to its rules regarding choice of law).
IN WITNESS WHEREOF, Borrower has caused this Allonge to be duly executed as
of the date set forth above.
BORROWER:
CHARTERMAC MORTGAGE CAPITAL CORPORATION
By:_________________________________
Name:____________________________
Title: __________________________
EXHIBIT 7.5
-----------
CLOSING CHECKLIST
-----------------
DOCUMENT RESPONSIBLE
PARTY
1. First Amendment to Amended and Restated Mortgage Warehousing Credit and BofA/NMF
Security Agreement
a. Exhibit 7.2.: Form of Allonge No. 1
b. Exhibit 7.5: Closing Checklist
2. Allonge No. 1 to Promissory Note, dated March 18, 2005, made by CMCC, BofA/NMF
payable to the order of Fleet National Bank, in the principal face amount
of $50,000,000.00.
3. Enforceability Opinions
a. Massachusetts Opinion Letter from Proskauer Rose LLP addressed to the Borrower/PR
Agent and the Lenders
b. Opinion Letter from ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ and Finger addressed to the Agent DE Special Counsel
and the Lenders
4. CMCC Corporate Authority Documents Borrower/PR
a. Long-form Certificate of Legal Existence certified by the Secretary of
State of Delaware
b. Secretary's Certificate, including the Resolutions adopted by the
Board of Directors authorizing the transaction and a bring-down of the
By-laws
5. Massachusetts Enforceability Opinion Letter from Proskauer Rose LLP Borrower/PR
pertaining to the execution, delivery and performance of the Amended and
Restated Mortgage Warehousing Credit and Security Agreement, dated as of
March 18, 2005
EXECUTION COUNTERPART
AMENDMENT NO. 2
---------------
TO
--
AMENDED AND RESTATED MORTGAGE WAREHOUSING
-----------------------------------------
CREDIT AND SECURITY AGREEMENT
-----------------------------
THIS AMENDMENT NO. 2 (this "Amendment") is entered into as of September 29,
2005, among: CHARTERMAC MORTGAGE CAPITAL CORPORATION, a Delaware corporation
("CMCC"), CHARTERMAC MORTGAGE PARTNERS CORP., a Delaware corporation ("CMP" and,
collectively with CMCC, the "Borrowers"); Bank of America, N.A. (successor by
merger to Fleet National Bank) as a Lender and as agent (in such capacity, the
"Agent") for itself and the other Lenders, and such Lenders; and CharterMac, a
Delaware statutory trust, and Charter Mac Corporation, a Delaware corporation
(each individually, a "Guarantor," and collectively the "Guarantors"). RECITALS
Reference is made to the following facts that constitute the background of
this Amendment:
A. CMCC, the Agent and the Lenders entered into that certain Amended and
Restated Mortgage Warehousing Credit and Security Agreement, dated as
of March 18, 2005 (as amended from time to time, the "Agreement").
Capitalized terms used herein and not otherwise defined herein shall
have the same meanings herein as ascribed to them in the Agreement.
B. CMCC, the Guarantors and CMP have requested that (i) CMP be added as a
Borrower to the Agreement; and (ii) certain amendments to the
Agreement and the Loan Documents be enacted in order to permit CMCC to
draw a Warehousing Advance (the "Villagio Advance") to facilitate CMCC
funding a $26,500,000 loan secured by a first mortgage on a 272 unit
multi-family property known as Villagio, located in Sacramento,
California ("Villagio").
C. The Agent and the Lenders are willing to amend the Agreement to (i)
admit CMP as a Borrower and (ii) permit the Villagio Advance, solely
upon the terms and conditions set forth in this Amendment.
NOW, THEREFORE, in consideration of the foregoing Recitals and of the
representations, warranties, covenants and conditions set forth herein and in
the Agreement, CMCC, the Guarantors, CMP, the Agent and the Lenders hereby agree
as follows:
1. AMENDMENTS TO THE AGREEMENT. In compliance with Section 12.14 of the
Agreement, the Borrower, CMP, the Agent, the Lenders and the Guarantors agree as
follows:
1.1 DEFINED TERMS. From and after the date hereof, Exhibit A to the
Agreement is hereby amended by adding the definitions, or revising the existing
definitions, set forth below:
BORROWER shall mean CMCC or CMP individually or collectively and jointly
and severally, and shall be deemed to refer to "Borrower" or "Borrowers",
all as the particular context suggests.
CASH COLLATERAL ACCOUNT means either the CMCC Cash Collateral Account or
the CMP Cash Collateral Account as a particular context suggests.
CMCC means CharterMac Mortgage Capital Corporation, a Delaware corporation,
a Borrower hereunder.
CMCC CASH COLLATERAL ACCOUNT means a demand deposit account maintained at
the Agent, in the Agent's name (as agent for the Lenders) and designated
for receipt of the proceeds of the sale or other disposition of Collateral.
As of the date hereof, the CMCC Cash Collateral Account has an account
number of 9419920632.
CMP means CharterMac Mortgage Partners Corp., a Delaware corporation, a
Borrower hereunder.
CMP CASH COLLATERAL ACCOUNT means a demand deposit account maintained at
the Agent, in the Agent's name (as agent for the Lenders) and designated
for receipt of the proceeds of the sale or other disposition of Collateral.
As of the date hereof, the CMP Cash Collateral Account has an account
number of 004602273053.
▇▇▇▇▇▇▇ MAC LOSS SHARING means loss sharing in connection with credit
enhancements provided by ▇▇▇▇▇▇▇ Mac and mortgage loans originated by CMP
and purchased by ▇▇▇▇▇▇▇ Mac under the Shadow Underwriting/Loss Share
Program.
▇▇▇▇▇▇ MAE CO-INSURANCE means loans originated by Capri Capital Finance LLC
or CMCC to be sold to ▇▇▇▇▇▇ ▇▇▇ which are federally insured under FHA
coinsurance programs that provide for the retention by the mortgage lender
of a portion of the mortgage insurance risk that otherwise would be assumed
by FHA under the applicable FHA insurance program.
1.2 REFERENCES TO CERTAIN TERMS. From and after the date hereof, all
references to the terms "CharterMac Mortgage Capital Corporation" and "Fleet
National Bank" shall be amended as follows:
a. All references to "CharterMac Mortgage Capital Corporation" shall
mean CMCC or CMP, individually or collectively and jointly and severally,
as a particular context suggests.
b. All references to "Fleet National Bank" shall be deleted and "Bank
of America, N.A., successor by merger to Fleet National Bank " shall be
substituted in its stead.
1.3 AMENDMENT TO SECTION 7.30 OF THE AGREEMENT. Section 7.30 is hereby
amended by deleting it in its entirety and substituting the following in its
stead:
"7.30 RECOURSE SERVICING CONTRACTS. The Borrowers will not acquire or enter
into Servicing Contracts under which the Borrowers must repurchase or
indemnify the holder of the Mortgage Loans as a result of defaults on the
Mortgage Loans at any time during the term of those Mortgage Loans, except
for (i) loss sharing under ▇▇▇▇▇▇ ▇▇▇ DUS Mortgage Loans and ▇▇▇▇▇▇ Mae
Co-Insurance with respect to CMCC, and (ii) ▇▇▇▇▇▇▇ Mac Loss Sharing with
respect to CMP."
2. WAREHOUSING ADVANCES TO CMP. In furtherance, and not in limitation, of the
foregoing, and for the express purpose of inducing the Agent and the Lenders to
enter into this Amendment to add CMP as a Borrower, and to induce the Lenders to
make Warehousing Advances to CMP, and to otherwise complete the transactions
contemplated hereby:
2.1 SECURITY FOR THE FACILITY. CMP hereby acknowledges that pursuant to
Section 3.1 of the Agreement, as amended hereby, CMP grants a security interest
to Agent, for the ratable benefit of the Lenders, in all of CMP's right, title
and interest in and to the Collateral.
2.2 WARRANTIES AND REPRESENTATIONS. CMP hereby acknowledges that pursuant
to this Amendment, CMP makes, jointly and severally with CMCC, all the
representations and warranties of the Borrowers as set forth in Sections 6 and 8
of the Agreement as of the date hereof and upon the date of each Warehousing
Advance.
2.3 COVENANTS. CMP hereby acknowledges that pursuant to this Amendment, CMP
makes, jointly and severally with CMCC, each covenant and agreement set forth in
Sections 7 and 8 of the Agreement, excluding Section 7.26 which applies only to
CMCC, so long as the Lenders have any obligation to make any Warehousing Advance
to CMP and until all of the Obligations arising out of or relating to any
Warehousing Advances have been fully paid and performed.
2
2.4 SCHEDULES. All of the Schedules pertaining to CMCC attached to the
Agreement are hereby supplemented to include the information and disclosures
pertaining to CMP as set forth in the Schedules attached to this Amendment.
2.5 JOINT AND SEVERAL LIABILITY. Each of the Borrowers hereby acknowledges
and agrees that it shall be jointly and severally liable for all of the
Obligations of both and each of the Borrowers.
3. VILLAGIO. In connection with, and solely for purposes of the Villagio
Advance, the Borrowers, Guarantors, Agent and Lenders hereby agree as follows:
3.1 INTEREST RATE. Notwithstanding the provisions of Section 2.4 of the
Agreement, principal amounts of the Villagio Advance outstanding shall bear
interest at the "Villagio Fixed Rate." "Villagio Fix Rate" means the per annum
rate equal to the Federal Funds Base Rate plus 140 basis points, with changes in
the Federal Funds Base Rate, if any, to be effective as of each Federal Funds
Rate Adjustment Date.
3.2 PRINCIPAL. Notwithstanding the terms of Section 2.4.7(i) of the
Agreement or Sections 5(f) or (g) of Exhibit D to the Agreement, the Villagio
Advance shall be repaid on the earlier to occur of (x) the payment of the
Committed Purchase Price pursuant to the Purchase Commitment from ▇▇▇▇▇▇▇ Mac
with respect to Villagio or (y) the Maturity Date.
3.3 FEE. Simultaneously with the execution and delivery of this Amendment,
the Borrower shall pay to the Agent, for the ratable benefit of each of the
Lenders, a fee in the amount of $10,000.
3.4 COLLATERAL. Until such time as the Villagio Advance and all Obligations
relating to or arising out of the Villagio Advance have been fully repaid and
performed, the definition of "Collateral" as set forth in Section 3.1 of the
Agreement is hereby amended by the addition of the following:
"3.1.10 That certain Irrevocable Standby Letter of Credit dated September
22, 2005, No. 2005-03, issued by Federal Home Loan Bank of San Francisco in
favor of the Agent, as transferee, from CMCC pursuant to that certain Full
Transfer of Irrevocable Standby Letter of Credit dated October 4, 2005."
3.5 CONDITIONS PRECEDENT. In addition to all of the requirements and
conditions precedent set forth in the Agreement, in the Loan Documents and
elsewhere in this Amendment, prior to the making of the Villagio Advance, the
Borrowers and the Guarantors shall satisfy, or cause to be satisfied, in form
and substance satisfactory to the Agent and the Lenders, all of the following
conditions precedent:
(a) The Agent shall have received a copy of an executed and delivered
early rate lock application letter between CMCC and ▇▇▇▇▇▇▇ Mac (the "Rate
Lock Letter");
(b) CharterMac's guaranty of the Borrowers' Obligations under the
Agreement shall have been amended so as to cause such guaranty not to be
subject to the limitations on liability set forth therein with respect to
Villagio;
(c) The Agent and each Lender shall have received all documentation
relating to Villagio, including, without limitation, the Purchase
Commitment from ▇▇▇▇▇▇▇ Mac (a copy of which is attached as Exhibit A to
the Rate Lock Letter); and
(d) The assignment of mortgage assigning the Villagio mortgage to the
Agent, for the ratable benefit of the Lenders, shall have been recorded in
the appropriate real estate records and shall be in full force and effect.
4. WAIVER. Notwithstanding Section 7.16 of the Agreement, the Agent and the
Lenders hereby consent to the transfer of assets from Capri Capital Associates,
LLC, a Delaware limited liability company, and Capri Capital Finance LLC, a
Delaware limited liability company, to (i) CMP with respect to mortgage loans
originated, sold to and serviced for ▇▇▇▇▇▇▇ Mac, and (ii) CMCC with respect to
the balance of such assets, each as more particularly described on Exhibit B
attached to this Amendment, and hereby waive any Default under Section 7.16 that
would otherwise exist due to such transfer.
3
5. CONDITIONS PRECEDENT. Prior to the effectiveness of this Amendment, CMP shall
satisfy all of the conditions precedent applicable to the Borrowers as set forth
in Section 5 of the Agreement. In furtherance of the foregoing, the Guarantors
and the Borrowers shall execute and/or deliver all documents, and take all such
further actions, in form and substance satisfactory to the Agent and the
Lenders, as set forth on the Closing Checklist attached hereto as EXHIBIT A,
including, without limitation, the execution and delivery of two Notes
substantially in the form of EXHIBIT F to the Agreement.
6. GUARANTORS. Each of the Guarantors hereby acknowledges the terms, provisions
and intent of this Amendment and acknowledges and agrees that all of the
provisions of its respective Guaranty shall continue to be its respective valid
and binding obligations, enforceable in accordance with their terms, including
without limitation, with respect to any Warehousing Advance or other Obligations
of both CMCC and CMP as Borrowers under the Agreement as contemplated in this
Amendment.
7. GENERAL.
-------
7.1 NOTICE. For purposes of Section 12.1 of the Agreement, CMP's address
for Notice shall be c/o CMCC at the address and as otherwise provided in Section
12.1 of the Agreement.
7.2 JURY TRIAL WAIVER. CMP HEREBY ACKNOWLEDGES THAT, PURSUANT TO SECTION
12.7 OF THE AGREEMENT AS AMENDED BY THIS AMENDMENT, CMP KNOWINGLY, VOLUNTARILY
AND INTENTIONALLY WAIVES THE RIGHT TO A TRIAL BY JURY IN RESPECT OF ANY
LITIGATION BASED HEREON, ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS
AMENDMENT OR ANY OTHER DOCUMENTS CONTEMPLATED TO BE EXECUTED IN CONNECTION
HEREWITH, OR ANY COURSE OF CONDUCT, COURSE OF DEALINGS, STATEMENTS (WHETHER
VERBAL OR WRITTEN) OR ACTIONS OF ANY PARTY, INCLUDING, WITHOUT LIMITATION, ANY
COURSE OF CONDUCT, COURSE OF DEALINGS, STATEMENTS OR ACTIONS OF AGENT OR ANY
LENDER RELATING TO THE ADMINISTRATION OF THE LOAN OR ENFORCEMENT OF THE LOAN
DOCUMENTS, AND AGREES THAT NONE OF THE PARTIES WILL SEEK TO CONSOLIDATE ANY SUCH
ACTION WITH ANY OTHER ACTION IN WHICH A JURY TRIAL CANNOT BE OR HAS NOT BEEN
WAIVED. EXCEPT AS PROHIBITED BY LAW, CMP HEREBY WAIVES ANY RIGHT IT MAY HAVE TO
CLAIM OR RECOVER IN ANY LITIGATION ANY SPECIAL, EXEMPLARY, PUNITIVE OR
CONSEQUENTIAL DAMAGES OR ANY DAMAGES OTHER THAN, OR IN ADDITION TO, ACTUAL
DAMAGES. CMP CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF AGENT OR ANY
LENDER HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT AGENT OR ANY LENDER WOULD
NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER. THIS
WAIVER CONSTITUTES A MATERIAL INDUCEMENT FOR AGENT AND THE LENDERS TO ACCEPT
THIS AMENDMENT.
7.3 RATIFICATION. Except as hereby amended, the Agreement and all other
Loan Documents and each provision thereof are hereby ratified and confirmed in
every respect and shall continue in full force and effect (except for changes to
all representations, warranties and covenants that are not singly or in the
aggregate materially adverse resulting from transactions contemplated and
permitted by the Agreement and other Loan Documents, and changes occurring in
the ordinary course of business that singly or in the aggregate are not
materially adverse, and except that representations and warranties relating
expressly to an earlier date are reaffirmed as of such date), and this Amendment
shall not be, and shall not be deemed to be, a waiver of any Default or of any
covenant, term or provision of the Agreement or other Loan Documents.
7.4 COUNTERPARTS. This Amendment may be executed and delivered in any
number of counterparts with the same effect as if the signatures hereto and
thereto were upon the same instrument.
7.5 AMENDMENT AS LOAN DOCUMENT. Each party hereto agrees and acknowledges
that this Amendment constitutes a "Loan Document" under and as defined in the
Agreement.
4
7.6 GOVERNING LAW. THIS AMENDMENT SHALL IN ALL RESPECTS BE GOVERNED,
CONSTRUED, APPLIED AND ENFORCED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE
COMMONWEALTH OF MASSACHUSETTS WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAWS.
7.7 SUCCESSORS AND ASSIGNS. This Amendment shall be binding upon each of
the Borrowers, the Guarantors, the Lenders and the Agent and their respective
successors and assigns, and shall inure to the benefit of each of the Borrowers,
the Guarantors, the Lenders and the Agent.
7.8 HEADINGS. Section headings in this Amendment are included herein for
convenience of reference only and shall not constitute a part of this Amendment
for any other purpose.
7.9 INTEGRATION. This Amendment (and documents contemplated by the Closing
Checklist) contains the entire understanding of the parties hereto with regard
to the subject matter contained herein. This Amendment supersedes all prior or
contemporaneous negotiations, promises, covenants, agreements and
representations of every nature whatsoever with respect to the matters referred
to in this Amendment, all of which have become merged and finally integrated
into this Amendment. Each of the parties hereto understands that in the event of
any subsequent litigation, controversy or dispute concerning any of the terms,
conditions or provisions of this Amendment, no party shall be entitled to offer
or introduce into evidence any oral promises or oral agreements between the
parties relating to the subject matter of this Amendment not included or
referred to herein and not reflected by a writing included or referred to
herein.
7.10 NO COURSE OF DEALING. The Agent and the Lenders have entered into this
Amendment on the express understanding with each Borrower and Guarantor that in
entering into this Amendment the Agent and the Lenders are not establishing any
course of dealing with the Borrowers and the Guarantors. The Agent's and the
Lenders' right to require strict performance with all of the terms and the
conditions of Agreement and the other Loan Documents shall not in any way be
impaired by the execution of this Amendment. None of the Agent and the Lenders
shall be obligated in any manner to execute any further amendments or waivers
and if such waivers or amendments are requested in the future, assuming the
terms and conditions thereof are satisfactory to them, the Agent and the Lenders
may require the payment of fees in connection therewith.
[Remainder of page intentionally left blank; signatures appear on next page]
5
IN WITNESS WHEREOF this Amendment has been duly executed and delivered as a
sealed instrument as of the date first set forth above.
BORROWERS: CHARTERMAC MORTGAGE CAPITAL CORPORATION
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------
Title: Corporate Managing Director
---------------------------
CHARTERMAC MORTGAGE PARTNERS CORP.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------
Title: Corporate Managing Director
---------------------------
AGENT AND LENDER: BANK OF AMERICA, N.A.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇
-----------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇
-------------
Title: Senior Vice President
---------------------
LENDER: HSBC BANK USA, NATIONAL ASSOCIATION
By: /s/ ▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
---------------------------
Name: ▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
-----------------------
Title: Vice President
--------------
[Signatures Continued on Next Page]
S-1
GUARANTORS: CHARTERMAC, a Delaware statutory trust
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------
Title: Chief Financial Officer
-----------------------
CHARTER MAC CORPORATION
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------
Title: Chief Financial Officer
-----------------------
S-2
EXHIBIT A
---------
CLOSING CHECKLIST
AMENDMENT NO. 2
TO
AMENDED AND RESTATED MORTGAGE WAREHOUSING
CREDIT AND SECURITY AGREEMENT
AMONG
BANK OF AMERICA, N.A., AND
HSBC BANK, USA,
AS LENDERS,
WITH
BANK OF AMERICA, N.A., AS AGENT,
AND
CHARTERMAC MORTGAGE CAPITAL CORPORATION, AND
CHARTERMAC MORTGAGE PARTNERS CORP., AS BORROWERS
AND
CHARTER MAC CORPORATION AND CHARTERMAC, AS GUARANTORS
DATED AS OF SEPTEMBER 29, 2005
A-1
--------------------------------------------------------------------------------
LIST OF PARTIES
--------------------------------------------------------------------------------
AGENT AND SOLE LEAD
-------------------
ARRANGER:
---------
Bank of America ("BofA")
Mail Code: MA5-503-04-16
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇, Senior Vice President
Tel.: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
E-mail: ▇▇▇▇.▇.▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇
Ugo Arinzeh, Vice President
Tel.: (▇▇▇) ▇▇▇-▇▇▇▇
Tel.: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
E-mail: ▇▇▇.▇▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇
OTHER LENDERS:
-------------
HSBC Bank USA, National Association ("HSBC")
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Vice President
Tel.: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
E-mail: ▇▇▇▇▇.▇▇▇▇▇▇▇▇@▇▇.▇▇▇▇.▇▇▇
BORROWERS AND
-------------
GUARANTORS:
----------
CharterMac Mortgage Capital Corporation
("CMCC" or "Borrower")
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Senior Vice President
Tel.: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
E-mail: ▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇.▇▇▇
CharterMac Mortgage Partners Corp. ("CMP" or "Borrower")
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Senior Vice President
Tel.: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
E-mail: ▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇.▇▇▇
A-2
Charter Mac Corporation
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇, Senior Vice President
Tel.: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
E-mail: ▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇.▇▇▇
CharterMac
f/k/a Charter Municipal Mortgage Acceptance Company
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇, Senior Vice President
Tel.: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
E-mail: ▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇.▇▇▇
COUNSEL FOR AGENT:
-----------------
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ & Fish, LLP ("NMF")
World Trade Center West
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇, Esq.
Tel.: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
E-mail: ▇▇▇▇▇▇▇▇▇▇▇@▇▇▇▇▇▇.▇▇▇
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
Tel.: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
E-mail: ▇▇▇▇▇▇▇▇@▇▇▇▇▇▇.▇▇▇
COUNSEL FOR HSBC:
----------------
▇▇▇▇▇▇▇▇ ▇▇▇▇▇ LLP ("PL")
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
Tel.: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
E-mail: ▇▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇
COUNSEL FOR BORROWER
--------------------
AND GUARANTOR:
-------------
Proskauer Rose ("PR")
▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
Tel.: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
E-mail: ▇▇▇▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇.▇▇▇
▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Esq.
Tel.: ▇▇▇-▇▇▇-▇▇▇▇
Fax: ▇▇▇-▇▇▇-▇▇▇▇
E-mail: ▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇.▇▇▇
A-3
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
Tel.: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
E-mail: ▇▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇.▇▇▇
A-4
CLOSING CHECKLIST
DOCUMENT/ACTION RESPONSIBLE STATUS
PARTY
1. Amendment No. 2 to Amended and Restated Mortgage Warehousing Credit and BofA/NMF
Security Agreement
a. Exhibit A: Closing Checklist
b. Exhibit B: Transactions, Contract Rights and Other Assets being
Conveyed by Capri Capital Advisors to CMCC CMP/PR
c. Schedule 4: Authorized Representatives
d. Schedule 6.3: Litigation
e. Schedule 6.7.1: Ownership, Subsidiaries and Taxpayer Identification
Numbers
f. Schedule 6.14: Certain Transactions
g. Schedule 6.20: Serving Portfolio
h. Schedule 6.21: Assumed Names
i. Schedule 7.7: Insurance
j. Schedule 7.12: Indebtedness of Borrower
k. Schedule 7.14.1: Other Indebtedness
l. Schedule 7.14.2: Other Liens
2. Promissory Note, dated September 29, 2005, made by CMP, payable to the BofA/NMF
order of Bank of America, N.A., in the principal face amount of
$50,000,000.00.
3. Promissory Note, dated September 29, 2005, made by CMP, payable to the BofA/NMF
order of HSBC Bank USA, in the principal face amount of $50,000,000.00.
4. Amendment No. 1 to Amended and Restated Guaranty, from Charter Mac BofA/NMF
Corporation
5. Amendment No. 1 to Second Amended and Restated Guaranty, from CharterMac BofA/NMF
6. UCC Initial Financing Statement for CMP filed with the Secretary of State BofA/NMF
of Delaware
7. Letter, dated as of September 29, 2005, from CMCC to Federal Home Loan Bank CMCC/PR
of San ▇▇▇▇▇▇▇▇, re: Letter of Credit No. 2005-30, with original Letter of
Credit attached.
8. Officer's Certificate CMP/PR
9. Enforceability Opinions
a. Opinion Letter from Proskauer Rose LLP addressed to the Agent and the CMP/PR
Lenders
b. Opinion Letter from ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ and Finger addressed to the Agent DE Special Counsel
and the Lenders
10. UCC, Bankruptcy, Tax Lien and Litigation Searches for CMP CMP/PR
A-5
DOCUMENT/ACTION RESPONSIBLE STATUS
PARTY
11. CMP Corporate Authority Documents CMP/PR
a. Certificate of Incorporation
b. Secretary's Certificate, including the Resolutions adopted by the
Board of Directors authorizing the transaction and the By-laws
c. Certificate of Legal Existence and Good Standing from the Secretary of
State
d. Incumbency Certificate
12. Payment of all accrued and unpaid legal fees and disbursements of the Borrowers
Agent's counsel relating to the Agreement or the transactions contemplated
thereby or related thereto, or the Borrowers
A-6
Borrowers
13. Villagio Due Diligence Borrowers
a. Early Rate Lock Agreement with Purchase Commitment from ▇▇▇▇▇▇▇ Mac
attached
b. Title insurance regarding B of A's insured interests, as Assignee,
under the Villagio Deed of Trust
A-7
EXHIBIT B
---------
SCHEDULE OF ASSETS TO BE TRANSFERRED
The following assets to be transferred by Capri Capital Finance, LLC and Capri
Capital Associates, LLC (the `Assignors") to CMCC and CMP:
1. Assignors' interests under agreements relating to the origination and
servicing of mortgage loans, including (i) agreements of Capri Capital
Finance, LLC with respect to loans originated, sold to and serviced
for ▇▇▇▇▇▇▇ Mac and ▇▇▇▇▇▇ Mae and (ii) agreements of Capri Capital
Associates, LLC with respect to loans originated, sold and serviced
for FHA and ▇▇▇▇▇▇ ▇▇▇.
2. Deposits and custodial and escrow accounts with respect to such
servicing arrangements.
3. Cash and receivables of the Assignors.
4. Furniture and equipment.
B-1
EXECUTION COUNTERPART
AMENDMENT NO. 3
---------------
TO
--
AMENDED AND RESTATED MORTGAGE WAREHOUSING
-----------------------------------------
CREDIT AND SECURITY AGREEMENT
-----------------------------
THIS AMENDMENT NO. 3 (this "Amendment") is entered into as of October 3,
2005, among CHARTERMAC MORTGAGE CAPITAL CORPORATION, a Delaware corporation,
("CMCC"), CHARTERMAC MORTGAGE PARTNERS CORP., a Delaware corporation ("CMP" and,
collectively with CMCC, the "Borrowers"); BANK OF AMERICA, N.A. (successor by
merger to Fleet National Bank) as a Lender ("BofA") and as agent (in such
capacity, the "Agent") for itself and the other Lenders, and such other Lenders;
and CharterMac, a Delaware statutory trust, and Charter Mac Corporation, a
Delaware corporation (each individually, a "Guarantor," and collectively "the
Guarantors").
RECITALS
--------
Reference is made to the following facts that constitute the background of
this Amendment:
A. The Borrowers, the Agent and the Lenders have entered into that
certain Amended and Restated Mortgage Warehousing Credit and Security
Agreement, dated as of March 18, 2005, as amended by Amendment No. 1,
dated as of July 28, 2005 and Amendment No. 2, dated as of September
29, 2005, (as so amended, the "Agreement"). Capitalized terms used
herein and not otherwise defined herein shall have the same meanings
herein as ascribed to them in the Agreement.
B. The Borrowers and the Guarantors have requested that, for a period of
29 days from the date hereof (the "Increase Period"), in the event the
principal amount of the Loan then outstanding exceeds the Warehouse
Commitment Amount, BofA fund Warehousing Advances up to $50,000,000.00
greater than the Warehouse Commitment Amount (the "Maximum Overadvance
Amount").
C. The Agent and the Lenders are willing to amend the Agreement to
accommodate such request solely upon the terms and conditions set
forth in this Amendment.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:
1. TWENTY-NINE DAY AMENDMENT. Except as specifically provided for herein, terms
of this Amendment will be effective solely for the duration of the Increase
Period. At the end of the Increase Period, except as specifically provided for
herein, this Amendment will be of no further force or effect, and the terms of
the Loan Agreement in effect in the absence of this Amendment will be reinstated
in full. The parties hereto hereby acknowledge and agree that the Increase
Period shall expire at 5:00 p.m. EDT on October 31, 2005.
2. TEMPORARY INCREASE IN THE LOAN.
------------------------------
2.1. OVERADVANCES. Subject to the terms and conditions of the Agreement,
and provided there is not then in existence a Default, (i) in the event that a
Warehousing Advance Request is received at such time as the aggregate principal
balance of the Loan then outstanding equals or exceeds the Warehousing
Commitment Amount, BofA agrees to fund 100% of such Warehousing Advance so
requested; and (ii) in the event a Warehousing Advance made pursuant to a
Warehousing Advance Request would cause the principal amount of the Loan then
outstanding to exceed the Warehousing Commitment Amount, BofA agrees to fund
100% of the portion of such Warehousing Advance that causes the then outstanding
principal balance of the Loan to exceed the Warehousing Commitment Amount; (each
such advance contemplated by clause (i) or portion thereof contemplated by
clause (ii), an "Overadvance"). BofA shall not be obligated to make all or any
portion of a requested Overadvance in the event, and to the extent, that the
making of such requested Overadvance would cause the aggregate principal amount
of all Overadvances then outstanding to exceed the then applicable Maximum
Overadvance Amount.
2.2. REPAYMENT OF OVERADVANCES. At any time any Overadvance or portion
thereof continues to be outstanding, any payment that is received by the Agent
or a Lender that is to be applied to reduce the then outstanding principal
balance of the Loan in accordance with the terms of the Agreement shall be paid
to BofA first to reduce or eliminate the then outstanding aggregate principal
balance of the Overadvances.
3. AMENDMENTS TO THE AGREEMENT.
---------------------------
3.1 AMENDMENT TO SECTION 2.1.1 OF THE AGREEMENT. Section 2.1.1 of the
Agreement is hereby amended by deleting the sentence "The aggregate principal
amount of the Loan outstanding at any one time may not exceed the Warehousing
Commitment Amount." and substituting the following in its stead:
"The aggregate principal amount of the Loan outstanding at any one
time may not exceed the Warehousing Commitment Amount plus the then
applicable Maximum Overadvance Amount."
3.2 AMENDMENT TO SECTION 2.1.2 OF THE AGREEMENT. Section 2.1.2 of the
Agreement is hereby amended by deleting the introductory sentence and
substituting the following in its stead:
"2.1.2 MAXIMUM AMOUNT OF FACILITY. Subject to the applicable terms and
conditions of this Agreement, the maximum principal amount outstanding
under the Facility shall not exceed $150,000,000.00."
3.3 AMENDMENT TO SECTION 2.1.4 OF THE AGREEMENT. Section 2.1.4 of the
Agreement is hereby amended by deleting it in its entirety and substituting the
following in its stead:
"2.1.4 OUTSTANDING BALANCE OF THE LOAN. In the event at any time the
outstanding principal balance of the Loan should exceed the lesser of
(x) the Warehousing Commitment Amount plus the Maximum Overadvance
Amount, or (y) the aggregate Warehousing Collateral Value of all
Eligible Loans against which Warehousing Advances are then
outstanding, the Borrowers shall repay such excess amount on demand to
the Agent so that the outstanding principal balance of the Facility is
in compliance with the terms and provisions hereof."
4. FEES.
----
4.1 LOAN FEES. The Borrowers shall pay a commitment fee to BofA for the
period commencing on the date hereof and ending at the end of the Increase
Period equal to $5,034.72.
4.2 OVERADVANCE FACILITY FEE. The Borrowers agree to pay a facility fee to
Agent on behalf of BofA on the average daily unborrowed portion of the Maximum
Overadvance Amount from the date hereof through October 31, 2005 (the
"Overadvance Facility Fee"), calculated as set forth below. The Overadvance
Facility Fee shall be payable in arrears on November 1, 2005 for the preceding
twenty-nine day period ending on October 31, 2005, and shall be calculated by
multiplying the average daily unborrowed portion of the Maximum Overadvance
Amount for such twenty-nine day period by 0.001% percent, and multiplying that
product by a fraction, the numerator of which is twenty-nine days, and the
denominator of which is ninety (90) days. The Borrowers shall not be entitled to
any credit, rebate or repayment of the Overadvance Facility Fee notwithstanding
any termination of this Amendment or the Agreement or suspension or termination
of the Agent's or any Lender's respective obligation to make Warehousing
Advances or Overadvances hereunder.
5. RATIFICATION OF LOAN DOCUMENTS; ACKNOWLEDGMENTS. Except as provided herein,
all terms and conditions of the Agreement and the other Loan Documents remain in
full force and effect. The Borrowers hereby:
5.1. Ratify, confirm, and reaffirm all representations, warranties, and
covenants contained in the Agreement and in the Loan Documents (except for
changes that are not singly or in the aggregate materially adverse resulting
from transactions contemplated and permitted by the Loan Agreement and the other
2
Loan Documents, and changes occurring in the ordinary course of business that
singly or in the aggregate are not materially adverse, and except that
representations and warranties relating expressly to an earlier date are
reaffirmed as of such date) and acknowledge and agree that the Obligations,
including, without limitation, on account of any Overadvances, are and continue
to be secured by the Collateral.
5.2. Acknowledge and agree that the Borrowers do not have any offsets,
defenses, or counterclaims against the Agent or any Lender thereunder, and to
the extent that any such offsets, defenses, or counterclaims may exist, the
Borrowers hereby WAIVE and RELEASE the Agent and Lenders therefrom.
5.3. Represent and warrant that:
a. As of the date the Borrowers execute this Amendment, no
Default exists, nor will a Default exist as of the effective date of this
Amendment.
b. This Amendment has been duly executed and delivered on behalf
of the Borrowers, and constitutes the legal, valid and binding obligation
of the Borrowers, enforceable against the Borrowers in accordance with its
terms, subject to the effect of applicable bankruptcy and other similar
laws affecting the rights of creditors generally and to the effect of
equitable principles whether applied in an action at law or a suit in
equity.
6. GUARANTY. The Guarantors hereby reaffirm their respective Guaranties, and
agree that neither the execution of this Amendment, the performance or
consummation of any of the transactions contemplated hereby, or any subsequent
modification, extension, renewal, amendment, supplement or restatement of the
Agreement, including any increase or reduction in the Total Commitments (or any
Lender's Commitment), shall in any way limit, restrict, qualify, or extinguish
their liability under the terms of their respective Guaranties, whether or not
either Guarantor executes a confirmation of its Guaranty in connection with any
such subsequent modification, extension, renewal, amendment, supplement or
restatement, or increase or reduction.
7. CONDITIONS PRECEDENT. This Amendment shall not be effective until each of the
following conditions precedent have been fulfilled to the satisfaction of the
Agent and the Lenders:
7.1. This Amendment shall have been duly executed and delivered by the
respective parties hereto (including the Guarantors for the purposes of Section
6 hereof) and shall be in full force and effect.
7.2. The allonge to the Promissory Note, dated as of March 18, 2005, made
by CMCC, payable to the order of Bank of America, N.A., in the principal face
amount of $100,000,000.00, substantially in the form of EXHIBIT 7.2 to this
Amendment (the "CMCC Allonge"), shall have been duly executed and delivered by
CMCC to BofA, and shall be in full force and effect. The allonge to the
Promissory Note, dated as of September 29, 2005, made by CMP, payable to the
order of Bank of America, N.A., in the principal face amount of $100,000,000.00,
substantially in the form of EXHIBIT 7.2 to this Amendment (the "CMP Allonge"
and together with the CMCC Allonge, the "Allonges"), shall have been duly
executed and delivered by CMP to BofA, and shall be in full force and effect.
7.3. All action on the part of the Borrowers necessary for the valid
execution, delivery and performance by the Borrowers of this Amendment and the
Allonges shall have been duly and effectively taken and evidence thereof
satisfactory to the Agent shall have been provided to the Agent.
7.4. All action on the part of the Guarantors necessary for the valid
execution, delivery and performance by the Guarantors of this Amendment shall
have been duly and effectively taken and evidence thereof satisfactory to the
Agent shall have been provided to the Agent.
7.5. The Borrowers shall have provided such other items to the Agent as are
set forth on the Closing Agenda attached as EXHIBIT 7.5 to this Amendment, and
such additional instruments and documents to the Agent as the Agent and the
Agent's counsel may have reasonably requested.
3
7.6. No Default shall have occurred and be continuing.
8. GENERAL.
-------
8.1 COUNTERPARTS. This Amendment may be executed and delivered in any
number of counterparts with the same effect as if the signatures hereto and
thereto were upon the same instrument.
8.2 AMENDMENT AS LOAN DOCUMENT. Each party hereto agrees and acknowledges
that this Amendment constitutes a "Loan Document" under and as defined in the
Agreement.
8.3 GOVERNING LAW. THIS AMENDMENT SHALL IN ALL RESPECTS BE GOVERNED,
CONSTRUED, APPLIED AND ENFORCED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE
COMMONWEALTH OF MASSACHUSETTS WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAWS.
8.4 SUCCESSORS AND ASSIGNS. This Amendment shall be binding upon each of
the Borrowers, the Guarantors, the Lenders and the Agent and their respective
successors and assigns, and shall inure to the benefit of each of the Borrowers,
the Guarantors, the Lenders and the Agent.
8.5 HEADINGS. Section headings in this Amendment are included herein for
convenience of reference only and shall not constitute a part of this Amendment
for any other purpose.
8.6 INTEGRATION. This Amendment (and documents contemplated by the Closing
Checklist) contains the entire understanding of the parties hereto with regard
to the subject matter contained herein. This Amendment supersedes all prior or
contemporaneous negotiations, promises, covenants, agreements and
representations of every nature whatsoever with respect to the matters referred
to in this Amendment, all of which have become merged and finally integrated
into this Amendment. Each of the parties hereto understands that in the event of
any subsequent litigation, controversy or dispute concerning any of the terms,
conditions or provisions of this Amendment, no party shall be entitled to offer
or introduce into evidence any oral promises or oral agreements between the
parties relating to the subject matter of this Amendment not included or
referred to herein and not reflected by a writing included or referred to
herein.
8.7 NO COURSE OF DEALING. The Agent and the Lenders have entered into this
Amendment on the express understanding with each Borrower and each Guarantor
that in entering into this Amendment the Agent and the Lenders are not
establishing any course of dealing with the Borrowers and the Guarantors. The
Agent's and the Lenders' right to require strict performance with all of the
terms and the conditions of Agreement and the other Loan Documents shall not in
any way be impaired by the execution of this Amendment. None of the Agent and
the Lenders shall be obligated in any manner to execute any further amendments
or waivers and if such waivers or amendments are requested in the future,
assuming the terms and conditions thereof are satisfactory to them, the Agent
and the Lenders may require the payment of fees in connection therewith.
[Remainder of the page intentionally left blank]
4
IN WITNESS WHEREOF, the undersigned have duly executed this Amendment under
seal as of the date first set forth above.
BORROWERS:
CHARTERMAC MORTGAGE CAPITAL CORPORATION
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------
Title: Chairman of the Board
---------------------
CHARTERMAC MORTGAGE PARTNERS CORP.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------
Title: Chairman of the Board
---------------------
LENDERS:
BANK OF AMERICA, N.A., as Agent and
as a Lender
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇
-----------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇
-------------
Title: Senior Vice President
---------------------
HSBC BANK USA, NATIONAL ASSOCIATION,
as a Lender
By:
--------------------
Name:
----------------
Title:
---------------------
[Signatures continued on next page]
(Amendment No.3 Sig. Pg)
Accepted and Agreed:
CHARTER MAC CORPORATION, as Guarantor
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------
Title: Chief Executive Officer
-----------------------
CHARTERMAC, as Guarantor
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------
Title: Chief Executive Officer
-----------------------
(Amendment No. 3 Sig Pg.)
EXHIBIT 7.2
-----------
ALLONGE NO. 1
DATED AS OF OCTOBER 3, 2005
This Allonge is made to that certain Promissory Note, dated as of March 18,
2005, made by the Borrower, and payable to Bank of America, N.A. (successor by
merger to Fleet National Bank), in the original principal amount of
$50,000,000.00 (the "Note"). Terms not defined herein have the same meanings as
in the Note.
Solely for the twenty-nine day period commencing as of the date hereof and
ending at 5:00 p.m. EDT on October 31, 2005 (the "Increase Period"), the
principal amount of the Note shall be increased from $50,000,000.00 to
$100,000,000.00. During the Increase Period this Allonge shall become part of
the Note and shall be subject to all of the terms and conditions thereof. From
and after the expiration of the Increase Period, this Allonge shall be of no
further force and effect and the Note shall remain in full force and effect
without reference to this Allonge.
Although it is in the interest of the parties that this Allonge be affixed
to the Note, this Allonge shall continue in full force and effect even if it has
not been so affixed.
This instrument shall have the force and effect of an instrument executed
under seal under the laws of The Commonwealth of Massachusetts (without regard
to its rules regarding choice of law).
IN WITNESS WHEREOF, Borrower has caused this Allonge to be duly executed as
of the date set forth above.
BORROWER:
CHARTERMAC MORTGAGE CAPITAL CORPORATION
By:_________________________________
Name:___________________________
Title: _________________________
EXHIBIT 7.5
-----------
CLOSING CHECKLIST
-----------------
DOCUMENT RESPONSIBLE
PARTY
1. First Amendment to Amended and Restated Mortgage Warehousing Credit and BofA/NMF
Security Agreement
a. Exhibit 7.2.: Form of Allonge No. 1
b. Exhibit 7.5: Closing Checklist
2. Allonge No. 1 to Promissory Note, dated as of March 18, 2005, made by CMCC, BofA/NMF
payable to the order of Bank of America, N.A., in the principal face amount
of $50,000,000.00.
3. Allonge No. 1 to Promissory Note, dated as of September 29, 2005, made by BofA/NMF
CMP, payable to the order of Bank of America, N.A., in the principal face
amount of $50,000,000.00.
4. Enforceability Opinions
a. Massachusetts Opinion Letter from Proskauer Rose LLP addressed to the Borrower/PR
Agent and the Lenders
b. Opinion Letter from ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ and Finger addressed to the Agent DE Special Counsel
and the Lenders
5. CMCC Corporate Authority Documents Borrower/PR
a. Secretary's Certificate, including the Resolutions adopted by the
Board of Directors authorizing the transaction and a bring-down of the
By-laws
6. CMP Corporate Authority Document Borrower/PR
a. Secretary's Certificate, including the Resolutions adopted by the
Board of Directors authorizing the transaction and a bring-down of the
By-laws
EXECUTION COUNTERPART
AMENDMENT NO. 4
---------------
TO
--
AMENDED AND RESTATED MORTGAGE WAREHOUSING
-----------------------------------------
CREDIT AND SECURITY AGREEMENT
-----------------------------
THIS AMENDMENT NO. 4 (this "Amendment") is entered into as of October 31,
2005, among CHARTERMAC MORTGAGE CAPITAL CORPORATION, a Delaware corporation,
("CMCC"), CHARTERMAC MORTGAGE PARTNERS CORP., a Delaware corporation ("CMP" and,
collectively with CMCC, the "Borrowers"); BANK OF AMERICA, N.A. (successor by
merger to Fleet National Bank) as a Lender ("BofA") and as agent (in such
capacity, the "Agent") for itself and the other Lenders, and such other Lenders;
and CharterMac, a Delaware statutory trust, and Charter Mac Corporation, a
Delaware corporation (each individually, a "Guarantor," and collectively "the
Guarantors").
RECITALS
--------
Reference is made to the following facts that constitute the background of
this Amendment:
A. The Borrowers, the Agent and the Lenders have entered into that
certain Amended and Restated Mortgage Warehousing Credit and Security
Agreement, dated as of March 18, 2005 ("Original Agreement"), as
amended by that certain Amendment No. 1, dated as of July 28, 2005
("Amendment No. 1") and that certain Amendment No. 2, dated as of
September 29, 2005 ("Amendment No. 2") and that certain Amendment No.
3 dated as of October 3, 2005 ("Amendment No. 3," and together with
the Original Agreement, Amendment No. 1 and Amendment No. 2, the
"Agreement"). Capitalized terms used herein and not otherwise defined
herein shall have the same meanings herein as ascribed to them in the
Agreement.
B. The Borrowers and the Guarantors have requested that the terms of
Amendment No. 3 be extended until 5:00 p.m. EDT on December 2, 2005 so
that for the period of thirty-three days from the date hereof, in the
event the principal amount of the Loan then outstanding exceeds the
Warehouse Commitment Amount, BofA fund Warehouse Advances up to
$50,000,000.00 greater than the Warehouse Commitment Amount.
C. The Agent and the Lenders are willing to amend the Agreement and
extend the terms of Amendment No. 3 to accommodate such request solely
upon the terms and conditions set forth in this Amendment.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:
1. AMENDMENTS TO AMENDMENT NO. 3.
-----------------------------
1.1. AMENDMENT TO RECITAL B OF AMENDMENT NO. 3. Recital B of Amendment No.
3 is hereby amended by deleting the clause "The Borrowers and the Guarantors
have requested that, for a period of 29 days from the date hereof (the "Increase
Period")," and substituting the following in its stead:
"The Borrowers and the Guarantors have requested that for a period of
61 days from the date hereof (the "Increase Period"),"
1.2. AMENDMENT TO SECTION 1 OF AMENDMENT NO. 3. The last sentence of the
Section 1 to Amendment No. 3 is hereby deleted in its entirety and substituting
the following in its stead:
"The parties hereto hereby acknowledge and agree that the Increase
Period shall expire at 5:00 p.m. EDT on December 2, 2005."
1.3. AMENDMENT TO SECTION 4 OF AMENDMENT NO. 3. Section 4.2 is hereby
deleted in its entirety and the following in substituted in its stead:
4.2 OVERADVANCE FACILITY FEE. The Borrowers agree to pay a
facility fee to Agent on behalf of BofA on the average daily
unborrowed portion of the Maximum Overadvance Amount from the date
hereof through December 2, 2005 (the "Overadvance Facility Fee"),
calculated as set forth below. The Overadvance Facility Fee shall be
payable in arrears on December 3, 2005 for the preceding 61 day period
ending on December 2, 2005, and shall be calculated by multiplying the
average daily unborrowed portion of the Maximum Overadvance Amount for
such 61 day period by 0.001% percent, and multiplying that product by
a fraction, the numerator of which is sixty-one days, and the
denominator of which is ninety (90) days. The Borrowers shall not be
entitled to any credit, rebate or repayment of the Overadvance
Facility Fee notwithstanding any termination of this Amendment or the
Agreement or suspension or termination of the Agent's or any Lender's
respective obligation to make Warehousing Advances or Overadvances
hereunder.
2. ADDITIONAL FEE. In consideration for the Agent's and BofA's willingness to
extend the Increase Period pursuant to this Amendment, the Borrower shall pay an
additional commitment fee of $5,729.17 to BofA, such payment to be made, and to
be considered fully earned and non-refundable, simultaneously with the execution
and delivery of this Amendment.
3. RATIFICATION OF LOAN DOCUMENTS; ACKNOWLEDGMENTS. Except as provided herein,
all terms and conditions of the Agreement and the other Loan Documents remain in
full force and effect. The Borrowers hereby:
3.1. Ratify, confirm, and reaffirm, as of the date hereof, all
representations, warranties, and covenants contained in the Agreement and in the
Loan Documents (except for changes that are not singly or in the aggregate
materially adverse resulting from transactions contemplated and permitted by the
Loan Agreement and the other Loan Documents, and changes occurring in the
ordinary course of business that singly or in the aggregate are not materially
adverse, and except that representations and warranties relating expressly to an
earlier date are reaffirmed as of such date) and acknowledge and agree that the
Obligations, including, without limitation, on account of any Overadvances, are
and continue to be secured by the Collateral.
3.2. Acknowledge and agree that the Borrowers do not have any offsets,
defenses, or counterclaims against the Agent or any Lender thereunder, and to
the extent that any such offsets, defenses, or counterclaims may exist, the
Borrowers hereby WAIVE and RELEASE the Agent and Lenders therefrom.
3.3. Represent and warrant that:
a. As of the date the Borrowers execute this Amendment, no
Default exists, nor will a Default exist as of the effective date of this
Amendment.
b. This Amendment has been duly executed and delivered on behalf
of the Borrowers, and constitutes the legal, valid and binding obligation
of the Borrowers, enforceable against the Borrowers in accordance with its
terms, subject to the effect of applicable bankruptcy and other similar
laws affecting the rights of creditors generally and to the effect of
equitable principles whether applied in an action at law or a suit in
equity.
4. GUARANTY. The Guarantors hereby reaffirm their respective Guaranties, and
agree that neither the execution of this Amendment, the performance or
consummation of any of the transactions contemplated hereby, or any subsequent
modification, extension, renewal, amendment, supplement or restatement of the
Agreement, including any increase or reduction in the Total Commitments (or any
Lender's Commitment), shall in any way limit, restrict, qualify, or extinguish
their liability under the terms of their respective Guaranties, whether or not
either Guarantor executes a confirmation of its Guaranty in connection with any
such subsequent modification, extension, renewal, amendment, supplement or
restatement, or increase or reduction. In furtherance of the foregoing, the
2
Guarantors' execution and delivery of this Amendment constitute the Guarantors'
ratification, confirmation and reaffirmation, as of the date hereof, of all
representations, warranties, and covenants in their respective Guaranties and in
the other Loan Documents (except for changes that are not singly or in the
aggregate materially adverse resulting from transactions contemplated and
permitted by the Loan Agreement and the other Loan Documents, and changes
occurring in the ordinary course of business that singly or in the aggregate are
not materially adverse, and except that representations and warranties relating
expressly to an earlier date are reaffirmed as of such date).
5. CONDITIONS PRECEDENT. This Amendment shall not be effective until each of the
following conditions precedent have been fulfilled to the satisfaction of the
Agent and the Lenders:
5.1. This Amendment shall have been duly executed and delivered by the
respective parties hereto (including the Guarantors for the purposes of Section
4 hereof) and shall be in full force and effect.
5.2. The allonge to the Promissory Note, dated as of March 18, 2005, made
by CMCC, payable to the order of Bank of America, N.A., in the principal face
amount of $100,000,000.00, substantially in the form of EXHIBIT 5.2 to this
Amendment (the "CMCC Allonge"), shall have been duly executed and delivered by
CMCC to BofA, and shall be in full force and effect. The allonge to the
Promissory Note, dated as of September 29, 2005, made by CMP, payable to the
order of Bank of America, N.A., in the principal face amount of $100,000,000.00,
substantially in the form of EXHIBIT 5.2 to this Amendment (the "CMP Allonge"
and together with the CMCC Allonge, the "Allonges"), shall have been duly
executed and delivered by CMP to BofA, and shall be in full force and effect.
5.3. All action on the part of the Borrowers necessary for the valid
execution, delivery and performance by the Borrowers of this Amendment and the
Allonges shall have been duly and effectively taken and evidence thereof
satisfactory to the Agent shall have been provided to the Agent.
5.4. All action on the part of the Guarantors necessary for the valid
execution, delivery and performance by the Guarantors of this Amendment shall
have been duly and effectively taken and evidence thereof satisfactory to the
Agent shall have been provided to the Agent.
5.5. The Borrowers shall have provided such other items to the Agent as are
set forth on the Closing Agenda attached as EXHIBIT 5.5 to this Amendment, and
such additional instruments and documents to the Agent as the Agent and the
Agent's counsel may have reasonably requested.
5.6. No Default shall have occurred and be continuing.
6. GENERAL.
-------
6.1 COUNTERPARTS. This Amendment may be executed and delivered in any
number of counterparts with the same effect as if the signatures hereto and
thereto were upon the same instrument.
6.2 AMENDMENT AS LOAN DOCUMENT. Each party hereto agrees and acknowledges
that this Amendment constitutes a "Loan Document" under and as defined in the
Agreement.
6.3 GOVERNING LAW. THIS AMENDMENT SHALL IN ALL RESPECTS BE GOVERNED,
CONSTRUED, APPLIED AND ENFORCED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE
COMMONWEALTH OF MASSACHUSETTS WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAWS.
6.4 SUCCESSORS AND ASSIGNS. This Amendment shall be binding upon each of
the Borrowers, the Guarantors, the Lenders and the Agent and their respective
successors and assigns, and shall inure to the benefit of each of the Borrowers,
the Guarantors, the Lenders and the Agent.
6.5 HEADINGS. Section headings in this Amendment are included herein for
convenience of reference only and shall not constitute a part of this Amendment
for any other purpose.
3
6.6 INTEGRATION. This Amendment (and documents contemplated by the Closing
Checklist) contains the entire understanding of the parties hereto with regard
to the subject matter contained herein. This Amendment supersedes all prior or
contemporaneous negotiations, promises, covenants, agreements and
representations of every nature whatsoever with respect to the matters referred
to in this Amendment, all of which have become merged and finally integrated
into this Amendment. Each of the parties hereto understands that in the event of
any subsequent litigation, controversy or dispute concerning any of the terms,
conditions or provisions of this Amendment, no party shall be entitled to offer
or introduce into evidence any oral promises or oral agreements between the
parties relating to the subject matter of this Amendment not included or
referred to herein and not reflected by a writing included or referred to
herein.
6.7 NO COURSE OF DEALING. The Agent and the Lenders have entered into this
Amendment on the express understanding with each Borrower and each Guarantor
that in entering into this Amendment the Agent and the Lenders are not
establishing any course of dealing with the Borrowers and the Guarantors. The
Agent's and the Lenders' right to require strict performance with all of the
terms and the conditions of Agreement and the other Loan Documents shall not in
any way be impaired by the execution of this Amendment. None of the Agent and
the Lenders shall be obligated in any manner to execute any further amendments
or waivers and if such waivers or amendments are requested in the future,
assuming the terms and conditions thereof are satisfactory to them, the Agent
and the Lenders may require the payment of fees in connection therewith.
[Remainder of the page intentionally left blank]
4
IN WITNESS WHEREOF, the undersigned have duly executed this Amendment under
seal as of the date first set forth above.
BORROWERS:
CHARTERMAC MORTGAGE CAPITAL CORPORATION
By: /s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
------------------
Name: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
--------------
Title: Treasurer
---------
CHARTERMAC MORTGAGE PARTNERS CORP.
By: /s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
------------------
Name: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
--------------
Title: Treasurer
---------
LENDERS:
BANK OF AMERICA, N.A., as Agent and
as a Lender
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇
-----------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇
-------------
Title: Senior Vice President
---------------------
HSBC BANK USA, NATIONAL ASSOCIATION,
as a Lender
By: /s/ ▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
---------------------------
Name: ▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
-----------------------
Title: Vice President
--------------
[Signatures continued on next page]
(Amendment No. 4 Sig. Pg.)
Accepted and Agreed:
CHARTER MAC CORPORATION, as Guarantor
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------
Title: Chief Operating Officer
-----------------------
CHARTERMAC, as Guarantor
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------
Title: Chief Operating Officer
-----------------------
(Amendment No. 4 Sig. Pg.)
EXHIBIT 5.2
-----------
ALLONGE NO. 2
DATED AS OF OCTOBER 31, 2005
This Allonge is made to that certain Promissory Note, dated as of March 18,
2005, made by the Borrower, and payable to Bank of America, N.A. (successor by
merger to Fleet National Bank), in the original principal amount of
$50,000,000.00 (the "Note"). Terms not defined herein have the same meanings as
in the Note.
Solely until the later to occur of (i) the end of the thirty-three day
period commencing as of the date hereof and ending at 5:00 p.m. EDT on December
2, 2005, or (ii) the repayment and performance in full of all Obligations with
respect to or arising out of Overadvances, (the "Increase Period"), the
principal amount of the Note shall be increased from $50,000,000.00 to
$100,000,000.00. During the Increase Period this Allonge shall become part of
the Note and shall be subject to all of the terms and conditions thereof. From
and after the expiration of the Increase Period, this Allonge shall be of no
further force and effect and the Note shall remain in full force and effect
without reference to this Allonge.
Although it is in the interest of the parties that this Allonge be affixed
to the Note, this Allonge shall continue in full force and effect even if it has
not been so affixed.
This instrument shall have the force and effect of an instrument executed
under seal under the laws of The Commonwealth of Massachusetts (without regard
to its rules regarding choice of law).
IN WITNESS WHEREOF, Borrower has caused this Allonge to be duly executed as
of the date set forth above.
BORROWER:
CHARTERMAC MORTGAGE CAPITAL CORPORATION
By:_________________________________
Name:___________________________
Title: _________________________
EXHIBIT 5.5
-----------
CLOSING CHECKLIST
-----------------
DOCUMENT RESPONSIBLE
PARTY
1. Amendment No. 4 to Amended and Restated Mortgage Warehousing Credit and BofA/NMF
Security Agreement
a. Exhibit 5.2.: Form of Allonge No. 2
b. Exhibit 5.5.: Closing Checklist
2. Allonge No. 2 to Promissory Note, dated as of March 18, 2005, made by CMCC, BofA/NMF
payable to the order of Bank of America, N.A., in the principal face amount
of $50,000,000.00.
3. Allonge No. 2 to Promissory Note, dated as of September 29, 2005, made by BofA/NMF
CMP, payable to the order of Bank of America, N.A., in the principal face
amount of $50,000,000.00.
4. Enforceability Opinions
a. Massachusetts Opinion Letter from Proskauer Rose LLP addressed to the Borrower/PR
Agent and the Lenders
5. CMCC Corporate Authority Documents Borrower/PR
a. Secretary's Certificate, including the Resolutions adopted by the
Board of Directors authorizing the transaction and a bring-down of the
By-laws
6. CMP Corporate Authority Documents Borrower/PR
a. Secretary's Certificate, including the Resolutions adopted by the
Board of Directors authorizing the transaction and a bring-down of the
By-laws
EXECUTION COUNTERPART
AMENDMENT NO. 5
---------------
TO
--
AMENDED AND RESTATED MORTGAGE WAREHOUSING
-----------------------------------------
CREDIT AND SECURITY AGREEMENT
-----------------------------
THIS AMENDMENT NO. 5 (this "Amendment") is entered into as of December 2,
2005, among CHARTERMAC MORTGAGE CAPITAL CORPORATION, a Delaware corporation,
("CMCC"), CHARTERMAC MORTGAGE PARTNERS CORP., a Delaware corporation ("CMP" and,
collectively with CMCC, the "Borrowers"); BANK OF AMERICA, N.A. (successor by
merger to Fleet National Bank) as a Lender ("BofA") and as agent (in such
capacity, the "Agent") for itself and the other Lenders, and such other Lenders;
and CharterMac, a Delaware statutory trust, and Charter Mac Corporation, a
Delaware corporation (each individually, a "Guarantor," and collectively the
"Guarantors").
RECITALS
--------
Reference is made to the following facts that constitute the background of
this Amendment:
A. The Borrowers, the Agent and the Lenders have entered into that
certain Amended and Restated Mortgage Warehousing Credit and Security
Agreement, dated as of March 18, 2005 ("Original Agreement"), as
amended by that certain Amendment No. 1, dated as of July 28, 2005
("Amendment No. 1"), that certain Amendment No. 2, dated as of
September 29, 2005 ("Amendment No. 2"), that certain Amendment No. 3,
dated as of October 3, 2005 ("Amendment No. 3") and that certain
Amendment No. 4, dated as of October 31, 2005 ("Amendment No. 4," and
together with the Original Agreement, Amendment ▇▇. ▇, ▇▇▇▇▇▇▇▇▇ ▇▇. ▇
and Amendment No. 3, the "Agreement"). Capitalized terms used herein
and not otherwise defined herein shall have the same meanings herein
as ascribed to them in the Agreement.
B. Pursuant to terms of Amendment No. 3, as amended by Amendment No. 4,
BofA agreed to fund Warehousing Advances of up to $50,000,000.00
greater than the Warehouse Commitment Amount (the "Maximum Overadvance
Amount") through 5:00 p.m. EST on December 2, 2005.
C. The Borrowers and the Guarantors have requested that (i) in lieu of
the terms of Amendment No. 3, as amended by Amendment No. 4, for a
period of twenty-five days from the date hereof (the "Increase
Period"), in the event the principal amount of the Loan then
outstanding exceeds the Warehouse Commitment Amount, BofA continue to
fund amounts not to exceed the Maximum Overadvance Amount, and (ii)
certain amendments to the Agreement and the Loan Documents be enacted
in order to permit CMCC to draw a Warehouse Advance (the "▇▇▇▇▇▇
Advance") to facilitate CMCC funding a loan in principal face amount
not to exceed $26,000,000.00 to CharterMac secured by an assignment to
CMCC of the first mortgage and the promissory note on a 341 unit
Multifamily Property known as the RCA ▇▇▇▇▇▇ building, located in
Camden, New Jersey ("▇▇▇▇▇▇").
D. The Agent and the Lenders are willing to amend the Agreement to
accommodate such requests solely upon the terms and conditions set
forth in this Amendment.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:
1. TWENTY-FIVE DAY AMENDMENT. Except as specifically provided for herein, terms
of this Amendment will be effective solely for the duration of the Increase
Period. At the end of the Increase Period, except as specifically provided for
herein, this Amendment will be of no further force or effect, and the terms of
the Loan Agreement in effect in the absence of this Amendment will be reinstated
in full. The parties hereto hereby acknowledge and agree that the Increase
Period shall expire at 5:00 p.m. EST on December 26, 2005.
2. TEMPORARY INCREASE IN THE LOAN.
------------------------------
2.1 OVERADVANCES. Subject to the terms and conditions of the Agreement, and
provided there is not then in existence a Default, (i) in the event that a
Warehousing Advance Request is received at such time as the aggregate principal
balance of the Loan then outstanding equals or exceeds the Warehousing
Commitment Amount, BofA agrees to fund 100% of such Warehousing Advance so
requested; and (ii) in the event a Warehousing Advance made pursuant to a
Warehousing Advance Request would cause the principal amount of the Loan then
outstanding to exceed the Warehousing Commitment Amount, BofA agrees to fund
100% of the portion of such Warehousing Advance that causes the then outstanding
principal balance of the Loan to exceed the Warehousing Commitment Amount; (each
such advance contemplated by clause (i) or portion thereof contemplated by
clause (ii), an "Overadvance"). BofA shall not be obligated to make all or any
portion of a requested Overadvance in the event, and to the extent, that the
making of such requested Overadvance would cause the aggregate principal amount
of all Overadvances then outstanding to exceed the then applicable Maximum
Overadvance Amount.
2.2 REPAYMENT OF OVERADVANCES. At any time any Overadvance or portion
thereof continues to be outstanding, any payment that is received by the Agent
or a Lender that is to be applied to reduce the then outstanding principal
balance of the Loan in accordance with the terms of the Agreement shall be paid
to BofA first to reduce or eliminate the then outstanding aggregate principal
balance of the Overadvances.
3. AMENDMENTS TO THE AGREEMENT.
---------------------------
3.1 AMENDMENT TO SECTION 2.1.1 OF THE AGREEMENT. Section 2.1.1 of the
Agreement is hereby amended by deleting the sentence "The aggregate principal
amount of the Loan outstanding at any one time may not exceed the Warehousing
Commitment Amount." and substituting the following in its stead:
"The aggregate principal amount of the Loan outstanding at any one
time may not exceed the Warehousing Commitment Amount plus the then
applicable Maximum Overadvance Amount."
3.2 AMENDMENT TO SECTION 2.1.2 OF THE AGREEMENT. Section 2.1.2 of the
Agreement is hereby amended by deleting the introductory sentence and
substituting the following in its stead:
"2.1.2 MAXIMUM AMOUNT OF FACILITY. Subject to the applicable terms and
conditions of this Agreement, the maximum principal amount outstanding
under the Facility shall not exceed $150,000,000.00."
3.3 AMENDMENT TO SECTION 2.1.4 OF THE AGREEMENT. Section 2.1.4 of the
Agreement is hereby amended by deleting it in its entirety and substituting the
following in its stead:
"2.1.4 OUTSTANDING BALANCE OF THE LOAN. In the event at any time the
outstanding principal balance of the Loan should exceed the lesser of
(x) the Warehousing Commitment Amount plus the Maximum Overadvance
Amount, or (y) the aggregate Warehousing Collateral Value of all
Eligible Loans against which Warehousing Advances are then
outstanding, the Borrowers shall repay such excess amount on demand to
the Agent so that the outstanding principal balance of the Facility is
in compliance with the terms and provisions hereof."
4. ▇▇▇▇▇▇ ADVANCE. In connection with, and solely for the purposes of the ▇▇▇▇▇▇
Advance, the Borrowers, Guarantors, Agent and Lenders hereby agree as follows:
4.1. TWENTY-FIVE DAY LIMITATION NOT APPLICABLE TO ▇▇▇▇▇▇. The provisions of
Section 1 of this Amendment, which limit the effectiveness of this Amendment to
the Increase Period, shall not apply to the terms of this Section 4.
2
4.2 CONDITIONS PRECEDENT TO ▇▇▇▇▇▇ ADVANCE. In addition to all of the
requirements and conditions precedent set forth in the Agreement, in the Loan
Documents and elsewhere in this Amendment (other than the requirements that CMCC
(i) deliver a Warehousing Advance Request pursuant to Sections 2.3.1 and 5.2.2
of the Agreement; and (ii) comply with procedures set forth in Exhibit B to the
Agreement pursuant to Sections 2.3.2 and 5.2.2 of the Agreement; all of which
requirements are hereby waived in connection with the making of the ▇▇▇▇▇▇
Advance), prior to the making of the ▇▇▇▇▇▇ Advance, the Borrowers and the
Guarantors shall satisfy, or cause to be satisfied, in form and substance
satisfactory to the Agent and the Lenders, all of the following conditions
precedent:
(a) CharterMac's guaranty of the Borrowers' Obligations under the
Agreement shall have been amended so as to cause such guaranty not to be
subject to the limitations on liability set forth therein with respect to
▇▇▇▇▇▇, the ▇▇▇▇▇▇ Advance and obligations specifically related thereto or
arising therefrom;
(b) The Agent and each Lender shall have received from CMCC
certified true and complete copies of all documentation relating to ▇▇▇▇▇▇;
and
4.3 ADDITIONAL AGREEMENTS RELATING TO ▇▇▇▇▇▇ ADVANCE. Notwithstanding any
other provisions of the Agreement, the Borrowers, Guarantors, Agent and Lenders
hereby agree as follows:
(a) The ▇▇▇▇▇▇ Advance, along with all interest and other
Obligations relating thereto, shall be due and payable upon the earlier to
occur of (i) ninety (90) days following the date of the ▇▇▇▇▇▇ Advance, and
(ii) the Maturity Date.
5. FEES.
----
5.1 LOAN FEES. The Borrowers shall pay a commitment fee to BofA for the
period commencing on the date hereof and ending at the end of the Increase
Period equal to $4,340.28, such payment to be made, and to be considered fully
earned and non-refundable, simultaneously with the execution and delivery of
this Amendment.
5.2 OVERADVANCE FACILITY FEE. The Borrowers agree to pay a facility fee to
Agent on behalf of BofA on the average daily unborrowed portion of the Maximum
Overadvance Amount from the October 3, 2005 through December 26, 2005 (the
"Overadvance Facility Fee"), calculated as set forth below. The Overadvance
Facility Fee shall be payable in arrears on December 27, 2005 for the preceding
eighty-five day period ending on December 26, 2005, and shall be calculated by
multiplying the average daily unborrowed portion of the Maximum Overadvance
Amount for such eighty-five day period by 0.001% percent, and multiplying that
product by a fraction, the numerator of which is eighty-five days, and the
denominator of which is ninety (90) days. The Borrowers shall not be entitled to
any credit, rebate or repayment of the Overadvance Facility Fee notwithstanding
any termination of this Amendment or the Agreement or suspension or termination
of the Agent's or any Lender's respective obligation to make Warehousing
Advances or Overadvances hereunder.
6. RATIFICATION OF LOAN DOCUMENTS; ACKNOWLEDGMENTS. Except as provided herein,
all terms and conditions of the Agreement and the other Loan Documents remain in
full force and effect. The Borrowers hereby:
6.1. Ratify, confirm, and reaffirm all representations, warranties, and
covenants contained in the Agreement and in the Loan Documents (except for
changes that are not singly or in the aggregate materially adverse resulting
from transactions contemplated and permitted by the Loan Agreement and the other
Loan Documents, and changes occurring in the ordinary course of business that
singly or in the aggregate are not materially adverse, and except that
representations and warranties relating expressly to an earlier date are
reaffirmed as of such date) and acknowledge and agree that the Obligations,
including, without limitation, on account of any Overadvances, are and continue
to be secured by the Collateral.
3
6.2. Acknowledge and agree that the Borrowers do not have any offsets,
defenses, or counterclaims against the Agent or any Lender thereunder, and to
the extent that any such offsets, defenses, or counterclaims may exist, the
Borrowers hereby WAIVE and RELEASE the Agent and Lenders therefrom.
6.3. Represent and warrant that:
a. As of the date the Borrowers execute this Amendment, no
Default exists, nor will a Default exist as of the effective date of this
Amendment.
b. This Amendment has been duly executed and delivered on behalf
of the Borrowers, and constitutes the legal, valid and binding obligation
of the Borrowers, enforceable against the Borrowers in accordance with its
terms, subject to the effect of applicable bankruptcy and other similar
laws affecting the rights of creditors generally and to the effect of
equitable principles whether applied in an action at law or a suit in
equity.
7. GUARANTY. The Guarantors hereby reaffirm their respective Guaranties, and
agree that neither the execution of this Amendment, the performance or
consummation of any of the transactions contemplated hereby, or any subsequent
modification, extension, renewal, amendment, supplement or restatement of the
Agreement, including any increase or reduction in the Total Commitments (or any
Lender's Commitment), shall in any way limit, restrict, qualify, or extinguish
their liability under the terms of their respective Guaranties, whether or not
either Guarantor executes a confirmation of its Guaranty in connection with any
such subsequent modification, extension, renewal, amendment, supplement or
restatement, or increase or reduction.
8. CONDITIONS PRECEDENT. This Amendment shall not be effective until each of the
following conditions precedent have been fulfilled to the satisfaction of the
Agent and the Lenders:
8.1. This Amendment shall have been duly executed and delivered by the
respective parties hereto (including the Guarantors for the purposes of Section
7 hereof) and shall be in full force and effect.
8.2. The allonge to the Promissory Note, dated as of March 18, 2005, made
by CMCC, payable to the order of Bank of America, N.A., in the principal face
amount of $100,000,000.00, substantially in the form of EXHIBIT 8.2 to this
Amendment (the "CMCC Allonge"), shall have been duly executed and delivered by
CMCC to BofA, and shall be in full force and effect. The allonge to the
Promissory Note, dated as of September 29, 2005, made by CMP, payable to the
order of Bank of America, N.A., in the principal face amount of $100,000,000.00,
substantially in the form of EXHIBIT 8.2 to this Amendment (the "CMP Allonge"
and together with the CMCC Allonge, the "Allonges"), shall have been duly
executed and delivered by CMP to BofA, and shall be in full force and effect. At
such time as (i) the Increase Period has ended and (ii) the principal amount of
the Loan outstanding is less than the Warehouse Commitment Amount, the Agent
will return the Allonges to the Borrowers marked cancelled.
8.3. All action on the part of the Borrowers necessary for the valid
execution, delivery and performance by the Borrowers of this Amendment and the
Allonges shall have been duly and effectively taken and evidence thereof
satisfactory to the Agent shall have been provided to the Agent.
8.4. All action on the part of the Guarantors necessary for the valid
execution, delivery and performance by the Guarantors of this Amendment shall
have been duly and effectively taken and evidence thereof satisfactory to the
Agent shall have been provided to the Agent.
8.5. The Borrowers shall have provided such other items to the Agent as are
set forth on the Closing Agenda attached as EXHIBIT 8.5 to this Amendment, and
such additional instruments and documents to the Agent as the Agent and the
Agent's counsel may have reasonably requested.
8.6. No Default shall have occurred and be continuing.
4
9. GENERAL.
-------
9.1 COUNTERPARTS. This Amendment may be executed and delivered in any
number of counterparts with the same effect as if the signatures hereto and
thereto were upon the same instrument.
9.2 AMENDMENT AS LOAN DOCUMENT. Each party hereto agrees and acknowledges
that this Amendment constitutes a "Loan Document" under and as defined in the
Agreement.
9.3 GOVERNING LAW. THIS AMENDMENT SHALL IN ALL RESPECTS BE GOVERNED,
CONSTRUED, APPLIED AND ENFORCED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE
COMMONWEALTH OF MASSACHUSETTS WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAWS.
9.4 SUCCESSORS AND ASSIGNS. This Amendment shall be binding upon each of
the Borrowers, the Guarantors, the Lenders and the Agent and their respective
successors and assigns, and shall inure to the benefit of each of the Borrowers,
the Guarantors, the Lenders and the Agent.
9.5 HEADINGS. Section headings in this Amendment are included herein for
convenience of reference only and shall not constitute a part of this Amendment
for any other purpose.
9.6 INTEGRATION. This Amendment (and documents contemplated by the Closing
Agenda) contains the entire understanding of the parties hereto with regard to
the subject matter contained herein. This Amendment supersedes all prior or
contemporaneous negotiations, promises, covenants, agreements and
representations of every nature whatsoever with respect to the matters referred
to in this Amendment, all of which have become merged and finally integrated
into this Amendment. Each of the parties hereto understands that in the event of
any subsequent litigation, controversy or dispute concerning any of the terms,
conditions or provisions of this Amendment, no party shall be entitled to offer
or introduce into evidence any oral promises or oral agreements between the
parties relating to the subject matter of this Amendment not included or
referred to herein and not reflected by a writing included or referred to
herein.
9.7 NO COURSE OF DEALING. The Agent and the Lenders have entered into this
Amendment on the express understanding with each Borrower and each Guarantor
that in entering into this Amendment the Agent and the Lenders are not
establishing any course of dealing with the Borrowers and the Guarantors. The
Agent's and the Lenders' right to require strict performance with all of the
terms and the conditions of Agreement and the other Loan Documents shall not in
any way be impaired by the execution of this Amendment. None of the Agent and
the Lenders shall be obligated in any manner to execute any further amendments
or waivers and if such waivers or amendments are requested in the future,
assuming the terms and conditions thereof are satisfactory to them, the Agent
and the Lenders may require the payment of fees in connection therewith.
[Remainder of the page intentionally left blank]
5
IN WITNESS WHEREOF, the undersigned have duly executed this Amendment under
seal as of the date first set forth above.
BORROWERS:
CHARTERMAC MORTGAGE CAPITAL CORPORATION
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------
Title: Corporate Managing Director
---------------------------
CHARTERMAC MORTGAGE PARTNERS CORP.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------
Title: Corporate Managing Director
---------------------------
LENDERS:
BANK OF AMERICA, N.A., as Agent and
as a Lender
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇
-----------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇
-------------
Title: Senior Vice President
---------------------
HSBC BANK USA, NATIONAL ASSOCIATION,
as a Lender
By: /s/ ▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
---------------------------
Name: ▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
-----------------------
Title: Vice President
--------------
[Signatures continued on next page]
(Amendment No. 5 Sig. Pg.)
Accepted and Agreed:
CHARTER MAC CORPORATION, as Guarantor
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------
Title: Chief Operating Officer
-----------------------
CHARTERMAC, as Guarantor
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------
Title: Chief Financial Officer
-----------------------
(Amendment No. 5 Sig. Pg.)
EXHIBIT 8.2
-----------
ALLONGE
DATED AS OF DECEMBER 2, 2005
This Allonge is made to that certain Promissory Note, dated as of March 18,
2005, made by the Borrower, and payable to Bank of America, N.A. (successor by
merger to Fleet National Bank), in the original principal amount of
$50,000,000.00 (the "Note"). Terms not defined herein have the same meanings as
in the Note.
The principal amount of the Note shall be increased from $50,000,000.00 to
$100,000,000.00. This Allonge hereby is part of the Note and shall be subject to
all of the terms and conditions thereof.
Although it is in the interest of the parties that this Allonge be affixed
to the Note, this Allonge shall continue in full force and effect even if it has
not been so affixed.
This instrument shall have the force and effect of an instrument executed
under seal under the laws of The Commonwealth of Massachusetts (without regard
to its rules regarding choice of law).
IN WITNESS WHEREOF, Borrower has caused this Allonge to be duly executed as
of the date set forth above.
BORROWER:
CHARTERMAC MORTGAGE CAPITAL CORPORATION
By:_________________________________
Name:___________________________
Title: _________________________
EXHIBIT 8.5
-----------
CLOSING AGENDA
--------------
DOCUMENT RESPONSIBLE
PARTY
1. Amendment No. 5 to Amended and Restated Mortgage Warehousing Credit and BofA/NMF
Security Agreement
a. Exhibit 8.2.: Form of Allonge
b. Exhibit 8.5.: Closing Agenda
2. Allonge dated as of December 2, 2005 to Promissory Note dated as of March BofA/NMF
18, 2005, made by CMCC, payable to the order of Bank of America, N.A.,
changing the original principal face amount of $50,000,000.00 to
$100,000,000.00.
3. Allonge dated as of December 2, 2005 to Promissory Note dated as of BofA/NMF
September 29, 2005, made by CMP, payable to the order of Bank of America,
N.A., changing the original principal face amount of $50,000,000.00 to
$100,000,000.00.
4. Amendment No. 2 to Second Amended and Restated Guaranty, from CharterMac. BofA/NMF
5. Certified true and correct copies of all executed and delivered Loan Borrower/PR
Documents relating to ▇▇▇▇▇▇.
6. Original executed counterpart of the ▇▇▇▇▇▇ Mortgage Note in principal face Borrower/PR
amount not to exceed $26 million, endorsed in blank by CMCC.
7. Assignment of ▇▇▇▇▇▇ Mortgage. BofA/NMF
8. Opinions
a. Massachusetts Opinion Letter from Proskauer Rose LLP addressed to the Borrower/PR
Agent and the Lenders
b. Opinion Letter from ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ and Finger addressed to the Agent
and the Lenders
9. CMCC Corporate Authority Documents Borrower/PR
a. Secretary's Certificate, including the Resolutions adopted by the
Board of Directors authorizing the transaction and a bring-down of the
By-laws
10. CMP Corporate Authority Documents Borrower/PR
a. Secretary's Certificate, including the Resolutions adopted by the
Board of Directors authorizing the transactions and a bring-down of
the By-laws.
11. Charter Mac Corporation Corporate Authority Documents Borrower/PR
a. Secretary's Certificate, including the Resolutions adopted by the
Board of Directors authorizing the guarantee of the transactions and a
bring-down of the corporation's By-laws,
12. CharterMac Statutory Trust Authority Documents Borrower/PR
a. Secretary's Certificate, including the Resolutions adopted by the
Trustees authorizing the guarantee of the transactions and a
bring-down of the By-laws,
13. Certificates of Good Standing and legal existence from the Delaware Borrower/PR
Secretary of State pertaining to the following entities:
a. CMCC
b. CMP
c. CharterMac Corporation
d. CharterMac
EXECUTION COUNTERPART
AMENDMENT NO. 6
---------------
TO
--
AMENDED AND RESTATED MORTGAGE WAREHOUSING
-----------------------------------------
CREDIT AND SECURITY AGREEMENT
-----------------------------
THIS AMENDMENT NO. 6 (this "Amendment") is entered into as of December 26,
2005, among CHARTERMAC MORTGAGE CAPITAL CORPORATION, a Delaware corporation,
("CMCC"), CHARTERMAC MORTGAGE PARTNERS CORP., a Delaware corporation ("CMP" and,
collectively with CMCC, the "Borrowers"); BANK OF AMERICA, N.A. (successor by
merger to Fleet National Bank) as a Lender ("BofA") and as agent (in such
capacity, the "Agent") for itself and the other Lenders, and such other Lenders;
and CharterMac, a Delaware statutory trust ("CharterMac"), and Charter Mac
Corporation, a Delaware corporation (each individually, a "Guarantor," and
collectively "the Guarantors").
RECITALS
--------
Reference is made to the following facts that constitute the background of
this Amendment:
A. The Borrowers, the Agent and the Lenders have entered into that
certain Amended and Restated Mortgage Warehousing Credit and Security
Agreement, dated as of March 18, 2005 ("Original Agreement"), as
amended by that certain Amendment No. 1, dated as of July 28, 2005
("Amendment No. 1"), that certain Amendment No. 2, dated as of
September 29, 2005 ("Amendment No. 2"), that certain Amendment No. 3,
dated as of October 3, 2005 ("Amendment No. 3"), that certain
Amendment No. 4, dated as of October 31, 2005 ("Amendment No. 4") and
that certain Amendment No. 5, dated as of December 2, 2005 ("Amendment
No. 5" and together with the Original Agreement, Amendment No. 1,
Amendment ▇▇. ▇, ▇▇▇▇▇▇▇▇▇ ▇▇. ▇, ▇▇▇▇▇▇▇▇▇ ▇▇. ▇, the "Agreement").
Capitalized terms used herein and not otherwise defined herein shall
have the same meanings herein as ascribed to them in the Agreement.
B. Pursuant to terms of Amendment No. 3, as amended by Amendment ▇▇. ▇
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇. ▇, ▇▇▇▇ agreed to fund Warehousing Advances of up to
$50,000,000.00 greater than the Warehousing Commitment Amount through
5:00 p.m. EST on December 26, 2005.
C. The Borrowers and the Guarantors have requested that in lieu of the
terms of Amendment No. 3, as amended by Amendment No. 4 and Amendment
No. 5, for a period of sixty-five days from the date hereof (the
"Increase Period"), in the event the principal amount of the Loan then
outstanding equals or exceeds the Warehousing Commitment Amount, the
Lenders fund Warehousing Advances of up to $150,000,000.00 greater
than the Warehousing Commitment Amount (the "Maximum Overadvance
Amount") through 5:00 p.m. EST on February 28, 2006. From and after
the 5:00 p.m. EST on February 28, 2006, the Maximum Overadvance Amount
shall equal zero dollars.
D. The Agent and the Lenders are willing to amend the Agreement to
accommodate such request solely upon the terms and conditions set
forth in this Amendment.
NOW, THEREFORE, in consideration of the above premises and the
representations, warranties, covenants and agreements set forth below, and for
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto agree as follows:
1. TEMPORARY INCREASE IN THE LOAN.
------------------------------
1.1. OVERADVANCES. Subject to the terms and conditions of the Agreement,
and provided there is not then in existence a Default, (i) in the event that a
Warehousing Advance Request is received at such time as the aggregate principal
balance of the Loan then outstanding equals or exceeds the Warehousing
Commitment Amount, the Lenders agree to fund such Warehousing Advance so
requested in accordance with their Commitment Percentage; and (ii) in the event
a Warehousing Advance made pursuant to a Warehousing Advance Request would cause
the principal amount of the Loan then outstanding to exceed the Warehousing
Commitment Amount, the Lenders agree to fund the portion of such Warehousing
Advance that causes the then outstanding principal balance of the Loan to exceed
the Warehousing Commitment Amount in accordance with their Commitment
Percentage; (each such advance contemplated by clause (i) or portion thereof
contemplated by clause (ii), an "Overadvance"). The Lenders shall not be
obligated to make all or any portion of a requested Overadvance in the event,
and to the extent, that the making of such requested Overadvance would cause the
aggregate principal amount of all Overadvances then outstanding to exceed the
then applicable Maximum Overadvance Amount.
1.2. REPAYMENT OF OVERADVANCES. At any time any Overadvance or portion
thereof continues to be outstanding, any payment that is received by the Agent
or a Lender that is to be applied to reduce the then outstanding principal
balance of the Loan in accordance with the terms of the Agreement shall be paid
first to reduce or eliminate the then outstanding aggregate principal balance of
the Overadvances.
2. AMENDMENTS TO THE AGREEMENT.
---------------------------
2.1. AMENDMENT TO SECTION 2.1.1 OF THE AGREEMENT. Section 2.1.1 of the
Agreement is hereby amended by deleting the sentence "The aggregate principal
amount of the Loan outstanding at any one time may not exceed the Warehousing
Commitment Amount." and substituting the following in its stead:
"The aggregate principal amount of the Loan outstanding at any one
time may not exceed the Warehousing Commitment Amount plus the then
applicable Maximum Overadvance Amount."
2.2. AMENDMENT TO SECTION 2.1.2 OF THE AGREEMENT. Section 2.1.2 of the
Agreement is hereby amended by deleting the introductory sentence and
substituting the following in its stead:
"2.1.2 MAXIMUM AMOUNT OF FACILITY. Subject to the applicable terms and
conditions of this Agreement, the maximum principal amount outstanding
under the Facility during the Increase Period shall not exceed
$250,000,000.00, and from and after February 28, 2006 shall not exceed
$100,000,00.00."
2.3. AMENDMENT TO SECTION 2.1.4 OF THE AGREEMENT. Section 2.1.4 of the
Agreement is hereby amended by deleting it in its entirety and substituting the
following in its stead:
"2.1.4 OUTSTANDING BALANCE OF THE LOAN. In the event at any time the
outstanding principal balance of the Loan should exceed the lesser of
(x) the Warehousing Commitment Amount plus the Maximum Overadvance
Amount, or (y) the aggregate Warehousing Collateral Value of all
Eligible Loans against which Warehousing Advances are then
outstanding, the Borrowers shall repay such excess amount on demand to
the Agent so that the outstanding principal balance of the Facility is
in compliance with the terms and provisions hereof."
2.4. AMENDMENT TO SECTION 2.5.2 OF THE AGREEMENT. Section 2.5.2 of the
Agreement is hereby amended by deleting it in its entirety and substituting the
following in its stead:
"2.5.2 FACILITY FEE. The Borrowers agree to pay a facility fee to
Agent on behalf of the Lenders on the average daily unborrowed portion
of (i) the Warehouse Commitment Amount and (ii) the Maximum
Overadvance Amount from the Agreement Date to the Maturity Date (the
"Facility Fee"), calculated as set forth below. The Facility Fee shall
be payable in arrears on the first Business Day of each calendar
quarter for the immediately preceding calendar quarter or portion
thereof and on the Maturity Date, and shall be calculated by
multiplying the sum of the average daily unborrowed portion of (i) the
Warehouse Commitment Amount and (ii) the Maximum Overadvance Amount
for such immediately preceding calendar quarter or portion thereof by
0.010% percent, and multiplying that product by a fraction, the
numerator of which is the number of days during such calendar quarter
that the Facility remained outstanding, and the denominator of which
is ninety (90) days. The Borrower shall not be entitled to any credit,
2
rebate or repayment of the Facility Fee notwithstanding any
termination of this Agreement or suspension or termination of the
Agent's and any Lender's respective obligation to make Warehousing
Advances hereunder."
2.5. AMENDMENT TO SCHEDULE 1 TO THE AGREEMENT. Schedule 1 to the Agreement
is hereby amended by deleting it in its entirety and substituting Schedule 1
attached to this Amendment in its stead.
3. COMMITMENT FEE. For the period commencing on the date hereof and ending on
February 28, 2006, the Borrowers shall pay to the Agent, simultaneously with the
execution and delivery hereof, for the pro rata benefit of the Lenders, based on
their respective Commitment Percentage, a commitment fee of $33,854.17.
4. RATIFICATION OF LOAN DOCUMENTS; ACKNOWLEDGMENTS. Except as provided herein,
all terms and conditions of the Agreement and the other Loan Documents remain in
full force and effect. The Borrowers hereby:
4.1. Ratify, confirm, and reaffirm, as of the date hereof, all
representations, warranties, and covenants contained in the Agreement and in the
Loan Documents (except for changes that are not singly or in the aggregate
materially adverse resulting from transactions contemplated and permitted by the
Loan Agreement and the other Loan Documents, and changes occurring in the
ordinary course of business that singly or in the aggregate are not materially
adverse, and except that representations and warranties relating expressly to an
earlier date are reaffirmed as of such date) and acknowledge and agree that the
Obligations are and continue to be secured by the Collateral.
4.2. Acknowledge and agree that the Borrowers do not have any offsets,
defenses, or counterclaims against the Agent or any Lender thereunder, and to
the extent that any such offsets, defenses, or counterclaims may exist, the
Borrowers hereby WAIVE and RELEASE the Agent and Lenders therefrom.
4.3. Represent and warrant that:
a. As of the date the Borrowers execute this Amendment, no
Default exists, nor will a Default exist as of the effective date of this
Amendment.
b. This Amendment has been duly executed and delivered on behalf
of the Borrowers, and constitutes the legal, valid and binding obligation
of the Borrowers, enforceable against the Borrowers in accordance with its
terms, subject to the effect of applicable bankruptcy and other similar
laws affecting the rights of creditors generally and to the effect of
equitable principles whether applied in an action at law or a suit in
equity.
5. GUARANTY. The Guarantors hereby reaffirm their respective Guaranties, and
agree that neither the execution of this Amendment, the performance or
consummation of any of the transactions contemplated hereby, or any subsequent
modification, extension, renewal, amendment, supplement or restatement of the
Agreement, including any increase or reduction in the Total Commitments (or any
Lender's Commitment) or the making of any Advance entirely or partially in
excess of the Warehousing Commitment Amount, shall in any way limit, restrict,
qualify, or extinguish their liability under the terms of their respective
Guaranties, whether or not either Guarantor executes a confirmation of its
Guaranty in connection with any such subsequent modification, extension,
renewal, amendment, supplement or restatement, or increase or reduction. In
furtherance of the foregoing, the Guarantors' execution and delivery of this
Amendment constitute the Guarantors' ratification, confirmation and
reaffirmation, as of the date hereof, of all representations, warranties, and
covenants in their respective Guaranties and in the other Loan Documents (except
for changes that are not singly or in the aggregate materially adverse resulting
from transactions contemplated and permitted by the Loan Agreement and the other
Loan Documents, and changes occurring in the ordinary course of business that
singly or in the aggregate are not materially adverse, and except that
representations and warranties relating expressly to an earlier date are
reaffirmed as of such date).
6. ADDITIONAL CONDITIONS PRECEDENT. This Amendment shall not be effective until
each of the following conditions precedent have been fulfilled to the
satisfaction of the Agent and the Lenders:
3
6.1. This Amendment shall have been duly executed and delivered by the
respective parties hereto (including the Guarantors for the purposes of Section
5 hereof) and shall be in full force and effect.
6.2. The allonges to the Promissory Notes, each dated as of March 18, 2005,
made by CMCC, payable to the order of Bank of America, N.A. and HSBC Bank USA,
changing the principal face amount of $50,000,000.00 to $150,000,000.00 and
$50,000,000.00 to $100,000,000.00, respectively, substantially in the form of
EXHIBIT 6.2. to this Amendment (the "CMCC Allonges"), shall have been duly
executed and delivered by CMCC to BofA and HSBC, and shall be in full force and
effect. The allonges to the Promissory Notes, each dated as of September 29,
2005, made by CMP, payable to the order of Bank of America, N.A. and HSBC Bank
USA, changing the principal face amount of $50,000,000.00 to $150,000,000.00 and
$50,000,000.00 to $100,000,000.00, respectively, substantially in the form of
EXHIBIT 6.2. to this Amendment (the "CMP Allonges" and together with the CMCC
Allonges, the "Allonges"), shall have been duly executed and delivered by CMP to
BofA and HSBC, and shall be in full force and effect. At such time as (i) each
of the Maximum Overadvance Amount and the aggregate principal amount outstanding
of Overadances is zero dollars, and (ii) the principal amount of the Loan
outstanding is less than the Warehouse Commitment Amount, the Lenders will
return the Allonges to the Borrowers marked cancelled.
6.3. All action on the part of the Borrowers necessary for the valid
execution, delivery and performance by the Borrowers of this Amendment and the
Allonges shall have been duly and effectively taken and evidence thereof
satisfactory to the Agent shall have been provided to the Agent.
6.4. All action on the part of the Guarantors necessary for the valid
execution, delivery and performance by the Guarantors of this Amendment shall
have been duly and effectively taken and evidence thereof satisfactory to the
Agent shall have been provided to the Agent.
6.5. The Borrowers and the Guarantors shall have provided such other items
to the Agent, and taken such other actions, as are set forth on the Closing
Agenda attached as EXHIBIT 6.5. to this Amendment, and such additional
instruments and documents shall be provided to the Agent, and such further
actions shall be taken, as the Agent and the Agent's counsel may have reasonably
requested.
6.6. No Default shall have occurred and be continuing.
7. GENERAL.
-------
7.1. COUNTERPARTS. This Amendment may be executed and delivered in any
number of counterparts with the same effect as if the signatures hereto and
thereto were upon the same instrument.
7.2. AMENDMENT AS LOAN DOCUMENT. Each party hereto agrees and acknowledges
that this Amendment constitutes a "Loan Document" under and as defined in the
Agreement.
7.3. GOVERNING LAW. THIS AMENDMENT SHALL IN ALL RESPECTS BE GOVERNED,
CONSTRUED, APPLIED AND ENFORCED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE
COMMONWEALTH OF MASSACHUSETTS WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAWS.
7.4. SUCCESSORS AND ASSIGNS. This Amendment shall be binding upon each of
the Borrowers, the Guarantors, the Lenders and the Agent and their respective
successors and assigns, and shall inure to the benefit of each of the Borrowers,
the Guarantors, the Lenders and the Agent.
7.5. HEADINGS. Section headings in this Amendment are included herein for
convenience of reference only and shall not constitute a part of this Amendment
for any other purpose.
7.6. INTEGRATION. This Amendment (and documents contemplated by the Closing
Agenda) contains the entire understanding of the parties hereto with regard to
the subject matter contained herein. This Amendment supersedes all prior or
contemporaneous negotiations, promises, covenants, agreements and
representations of every nature whatsoever with respect to the matters referred
4
to in this Amendment, all of which have become merged and finally integrated
into this Amendment. Each of the parties hereto understands that in the event of
any subsequent litigation, controversy or dispute concerning any of the terms,
conditions or provisions of this Amendment, no party shall be entitled to offer
or introduce into evidence any oral promises or oral agreements between the
parties relating to the subject matter of this Amendment not included or
referred to herein and not reflected by a writing included or referred to
herein.
7.7. NO COURSE OF DEALING. The Agent and the Lenders have entered into this
Amendment on the express understanding with each Borrower and each Guarantor
that in entering into this Amendment the Agent and the Lenders are not
establishing any course of dealing with the Borrowers and the Guarantors. The
Agent's and the Lenders' right to require strict performance with all of the
terms and the conditions of Agreement and the other Loan Documents shall not in
any way be impaired by the execution of this Amendment. None of the Agent and
the Lenders shall be obligated in any manner to execute any further amendments
or waivers and if such waivers or amendments are requested in the future,
assuming the terms and conditions thereof are satisfactory to them, the Agent
and the Lenders may require the payment of fees in connection therewith.
[Remainder of the page intentionally left blank]
5
IN WITNESS WHEREOF, the undersigned have duly executed this Amendment under
seal as of the date first set forth above.
BORROWERS:
CHARTERMAC MORTGAGE CAPITAL CORPORATION
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------
Title: Corporate Managing Director
---------------------------
CHARTERMAC MORTGAGE PARTNERS CORP.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------
Title: Corporate Managing Director
---------------------------
LENDERS:
BANK OF AMERICA, N.A., as Agent and
as a Lender
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇
-----------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇
-------------
Title: Senior Vice President
---------------------
HSBC BANK USA, NATIONAL ASSOCIATION,
as a Lender
By: /s/ ▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
---------------------------
Name: ▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
-----------------------
Title: Vice President
--------------
[Signatures continued on next page]
(Amendment No. 6 Sig. Pg.)
Accepted and Agreed:
CHARTER MAC CORPORATION, as Guarantor
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------
Title: Chief Operating Officer
-----------------------
CHARTERMAC, as Guarantor
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------
Title: Chief Financial Officer
-----------------------
(Amendment No. 6 Sig. Pg.)
EXHIBIT 6.2
-----------
ALLONGE
DATED AS OF DECEMBER 26, 2005
This Allonge is made to that certain Promissory Note, dated as of March 18,
2005, made by the Borrower, and payable to Bank of America, N.A. (successor by
merger to Fleet National Bank), in the original principal amount of
$50,000,000.00 (the "Note"). Terms not defined herein have the same meanings as
in the Note.
From and after the date hereof the principal amount of the Note shall be
increased from $50,000,000.00 to $150,000,000.00, and this Allonge shall become
part of the Note and shall be subject to all of the terms and conditions
thereof.
Although it is in the interest of the parties that this Allonge be affixed
to the Note, this Allonge shall continue in full force and effect even if it has
not been so affixed.
This instrument shall have the force and effect of an instrument executed
under seal under the laws of The Commonwealth of Massachusetts (without regard
to its rules regarding choice of law).
IN WITNESS WHEREOF, Borrower has caused this Allonge to be duly executed as
of the date set forth above.
BORROWER:
CHARTERMAC MORTGAGE CAPITAL CORPORATION
By:_________________________________
Name:___________________________
Title: _________________________
EXHIBIT 6.5
-----------
CLOSING AGENDA
--------------
DOCUMENT RESPONSIBLE
PARTY
1. Amendment No. 6 to Amended and Restated Mortgage Warehousing Credit and BofA/NMF
Security Agreement
a. Exhibit 6.2.: Form of Allonge
b. Exhibit 6.5.: Closing Agenda
2. Allonge dated December 26 2005 to Promissory Note, dated as of March 18, BofA/NMF
2005, made by CMCC, payable to the order of Bank of America, N.A., changing
the original principal face amount of $50,000,000.00 to $150,000,000.00.
3. Allonge dated December 26, 2005 to Promissory Note, dated as of March 18, BofA/NMF
2005, made by CMCC, payable to the order of HSBC Bank USA, changing the
original principal face amount of $50,000,000.00 to $100,000,000.00.
4. Allonge dated December 26, 2005 to Promissory Note, dated as of September BofA/NMF
29, 2005, made by CMP, payable to the order of Bank of America, N.A.,
changing the original principal face amount of $50,000,000.00 to
$150,000,000.00.
5. Allonge dated December 26, 2005 to Promissory Note, dated as of September BofA/NMF
29, 2005, made by CMP, payable to the order of HSBC Bank USA, changing the
principal face amount of $50,000,000.00 to $100,000,000.00.
6. Opinions Borrower/PR
a. Massachusetts Opinion Letter from Proskauer Rose LLP addressed to the
Agent and the Lenders
b. Opinion Letter from ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ and Finger addressed to the Agent
and the Lenders
7. CMCC Corporate Authority Documents Borrower/PR
a. Secretary's Certificate, including the Resolutions adopted by the
Board of Directors authorizing the transaction and a bring-down of the
By-laws
8. CMP Corporate Authority Documents Borrower/PR
a. Secretary's Certificate, including the Resolutions adopted by the
Board of Directors authorizing the transactions and a bring-down of
the By-laws.
9. CharterMac Corporation Corporate Authority Documents Borrower/PR
a. Secretary's Certificate, including the Resolutions adopted by the
Board of Directors authorizing the guarantee of the transactions and a
bring-down of the By-laws.
10. CharterMac Statutory Trust Authority Documents Borrower/PR
a. Secretary's Certificate, including the Resolutions adopted by the
Board of Trustees authorizing the guarantee of the transactions and a
bring-down of the By-laws.
11. Certificates of Good Standing and Legal Existence from the Delaware Borrower/PR
Secretary of State pertaining to the following entities:
a. CMCC
b. CMP
c. CharterMac Corporation
d. CharterMac
SCHEDULE 1 TO LOAN AGREEMENT
----------------------------
COMMITMENTS: COMMITMENT PERCENTAGES; NOTICE ADDRESSES
-----------------------------------------------------
LENDER COMMITMENT COMMITMENT PERCENTAGE
--------------------------------------------------------------------------------
Bank of America, N.A. $150,000,000.00 60.0%
HSBC Bank USA $100,000,000.00 40.0%
FOR NOTICES:
Bank of America, N.A.
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇, Senior Vice President
Mail Stop: MA5-503-04-16
Fax No.: (▇▇▇) ▇▇▇-▇▇▇▇
HSBC Bank USA, National Association
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Vice President
. Fax No.: (▇▇▇) ▇▇▇-▇▇▇▇
EXECUTION COUNTERPART
AMENDMENT NO. 7
---------------
TO
--
AMENDED AND RESTATED MORTGAGE WAREHOUSING
-----------------------------------------
CREDIT AND SECURITY AGREEMENT
-----------------------------
THIS AMENDMENT NO. 7 (this "Amendment") is entered into as of February 28,
2006, among CHARTERMAC MORTGAGE CAPITAL CORPORATION, a Delaware corporation,
("CMCC"), CHARTERMAC MORTGAGE PARTNERS CORP., a Delaware corporation ("CMP" and,
collectively with CMCC, the "Borrowers"); BANK OF AMERICA, N.A. (successor by
merger to Fleet National Bank) as a Lender ("BofA") and as agent (in such
capacity, the "Agent") for itself and the other Lenders, and such other Lenders;
and CharterMac, a Delaware statutory trust, and Charter Mac Corporation, a
Delaware corporation (each individually, a "Guarantor," and collectively "the
Guarantors").
RECITALS
--------
Reference is made to the following facts that constitute the background of
this Amendment:
A. The Borrowers, the Agent and the Lenders have entered into that
certain Amended and Restated Mortgage Warehousing Credit and Security
Agreement, dated as of March 18, 2005 ("Original Agreement"), as
amended by that certain Amendment No. 1 dated as of July 28, 2005
("Amendment No. 1"), that certain Amendment No. 2 dated as of
September 29, 2005 ("Amendment No. 2"), that certain Amendment No. 3
dated as of October 3, 2005 ("Amendment No. 3"), that certain
Amendment No. 4 dated as of October 31, 2005 ("Amendment No. 4"), that
certain Amendment No. 5 dated as of December 2, 2005 ("Amendment No.
5") and that certain Amendment No. 6 dated as of December 26, 2005
("Amendment No. 6" and together with the Original Agreement, Amendment
▇▇. ▇, ▇▇▇▇▇▇▇▇▇ ▇▇. ▇, ▇▇▇▇▇▇▇▇▇ ▇▇. ▇, Amendment ▇▇. ▇, ▇▇▇▇▇▇▇▇▇
▇▇. ▇, the "Agreement"). Capitalized terms used herein and not
otherwise defined herein shall have the same meanings herein as
ascribed to them in the Agreement.
B. The Borrowers and the Guarantors have requested that the Maturity Date
be extended to March 14, 2006. The Agent and the Lenders are willing
to amend the Agreement to accommodate such request solely upon the
terms and conditions set forth in this Amendment.
NOW, THEREFORE, in consideration of the above premises and the
representations, warranties, covenants and agreements set forth below, and for
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto agree as follows:
1. AMENDMENTS TO THE AGREEMENT.
---------------------------
1.1. AMENDMENT TO EXHIBIT A TO THE AGREEMENT. The definition of Maturity
Date is hereby amended by deleting it in its entirety and substituting the
following in its stead: "MATURITY DATE means the earlier of March 14, 2006 or
the date upon which the whole of the Commitments are terminated or the Loan is
accelerated in accordance with applicable provisions of this Agreement."
1.2. AMENDMENT TO SCHEDULE 1 TO THE AGREEMENT. Schedule 1 to the Agreement
is hereby amended by deleting it in its entirety and substituting Schedule 1
attached to this Amendment in its stead.
2. COMMITMENT FEE. For the period commencing on the date hereof and ending on
March 14, 2006, the Borrowers shall pay to the Agent, simultaneously with the
execution and delivery hereof, for the pro rata benefit of the Lenders, based on
their respective Commitment Percentage, a commitment fee of $4,861.11.
3. EXPIRATION OF OVERADVANCES. The parties acknowledge that, from and after the
date hereof, (a) the Maximum Overadvance Amount is zero (0), and (b) the
maximum principal amount outstanding under the Facility shall not exceed
$100,000,000.
4. RATIFICATION OF LOAN DOCUMENTS; ACKNOWLEDGMENTS. Except as provided herein,
all terms and conditions of the Agreement and the other Loan Documents remain in
full force and effect. The Borrowers hereby:
4.1. Ratify, confirm, and reaffirm, as of the date hereof, all
representations, warranties, and covenants contained in the Agreement and in the
Loan Documents (except for changes that are not singly or in the aggregate
materially adverse resulting from transactions contemplated and permitted by the
Loan Agreement and the other Loan Documents, and changes occurring in the
ordinary course of business that singly or in the aggregate are not materially
adverse, and except that representations and warranties relating expressly to an
earlier date are reaffirmed as of such date) and acknowledge and agree that the
Obligations are and continue to be secured by the Collateral.
4.2. Acknowledge and agree that the Borrowers do not have any offsets,
defenses, or counterclaims against the Agent or any Lender thereunder, and to
the extent that any such offsets, defenses, or counterclaims may exist, the
Borrowers hereby WAIVE and RELEASE the Agent and Lenders therefrom.
4.3. Represent and warrant that:
a. As of the date the Borrowers execute this Amendment, no
Default exists, nor will a Default exist as of the effective date of this
Amendment.
b. This Amendment has been duly executed and delivered on behalf
of the Borrowers, and constitutes the legal, valid and binding obligation
of the Borrowers, enforceable against the Borrowers in accordance with its
terms, subject to the effect of applicable bankruptcy and other similar
laws affecting the rights of creditors generally and to the effect of
equitable principles whether applied in an action at law or a suit in
equity.
5. GUARANTY. The Guarantors hereby reaffirm their respective Guaranties, and
agree that neither the execution of this Amendment, the performance or
consummation of any of the transactions contemplated hereby, or any subsequent
modification, extension, renewal, amendment, supplement or restatement of the
Agreement, including any increase or reduction in the Total Commitments (or any
Lender's Commitment) or the making of any Advance entirely or partially in
excess of the Warehousing Commitment Amount, shall in any way limit, restrict,
qualify, or extinguish their liability under the terms of their respective
Guaranties, whether or not either Guarantor executes a confirmation of its
Guaranty in connection with any such subsequent modification, extension,
renewal, amendment, supplement or restatement, or increase or reduction. In
furtherance of the foregoing, the Guarantors' execution and delivery of this
Amendment constitute the Guarantors' ratification, confirmation and
reaffirmation, as of the date hereof, of all representations, warranties, and
covenants in their respective Guaranties and in the other Loan Documents (except
for changes that are not singly or in the aggregate materially adverse resulting
from transactions contemplated and permitted by the Loan Agreement and the other
Loan Documents, and changes occurring in the ordinary course of business that
singly or in the aggregate are not materially adverse, and except that
representations and warranties relating expressly to an earlier date are
reaffirmed as of such date).
6. ADDITIONAL CONDITIONS PRECEDENT. This Amendment shall not be effective until
each of the following conditions precedent have been fulfilled to the
satisfaction of the Agent and the Lenders:
6.1. This Amendment shall have been duly executed and delivered by the
respective parties hereto (including the Guarantors for the purposes of Section
5 hereof) and shall be in full force and effect.
6.2. No Default shall have occurred and be continuing.
7. GENERAL.
-------
7.1. COUNTERPARTS. This Amendment may be executed and delivered in any
number of counterparts with the same effect as if the signatures hereto and
thereto were upon the same instrument.
7.2. AMENDMENT AS LOAN DOCUMENT. Each party hereto agrees and acknowledges
that this Amendment constitutes a "Loan Document" under and as defined in the
Agreement.
7.3. GOVERNING LAW. THIS AMENDMENT SHALL IN ALL RESPECTS BE GOVERNED,
CONSTRUED, APPLIED AND ENFORCED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE
COMMONWEALTH OF MASSACHUSETTS WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAWS.
7.4. SUCCESSORS AND ASSIGNS. This Amendment shall be binding upon each of
the Borrowers, the Guarantors, the Lenders and the Agent and their respective
successors and assigns, and shall inure to the benefit of each of the Borrowers,
the Guarantors, the Lenders and the Agent.
7.5. HEADINGS. Section headings in this Amendment are included herein for
convenience of reference only and shall not constitute a part of this Amendment
for any other purpose.
7.6. INTEGRATION. This Amendment contains the entire understanding of the
parties hereto with regard to the subject matter contained herein. This
Amendment supersedes all prior or contemporaneous negotiations, promises,
covenants, agreements and representations of every nature whatsoever with
respect to the matters referred to in this Amendment, all of which have become
merged and finally integrated into this Amendment. Each of the parties hereto
understands that in the event of any subsequent litigation, controversy or
dispute concerning any of the terms, conditions or provisions of this Amendment,
no party shall be entitled to offer or introduce into evidence any oral promises
or oral agreements between the parties relating to the subject matter of this
Amendment not included or referred to herein and not reflected by a writing
included or referred to herein.
7.7. NO COURSE OF DEALING. The Agent and the Lenders have entered into this
Amendment on the express understanding with each Borrower and each Guarantor
that in entering into this Amendment the Agent and the Lenders are not
establishing any course of dealing with the Borrowers and the Guarantors. The
Agent's and the Lenders' right to require strict performance with all of the
terms and the conditions of Agreement and the other Loan Documents shall not in
any way be impaired by the execution of this Amendment. None of the Agent and
the Lenders shall be obligated in any manner to execute any further amendments
or waivers and if such waivers or amendments are requested in the future,
assuming the terms and conditions thereof are satisfactory to them, the Agent
and the Lenders may require the payment of fees in connection therewith.
[Remainder of the page intentionally left blank]
3
IN WITNESS WHEREOF, the undersigned have duly executed this Amendment under
seal as of the date first set forth above.
BORROWERS:
CHARTERMAC MORTGAGE CAPITAL CORPORATION
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇
---------------
Name: ▇▇▇▇ ▇▇▇▇▇▇
-----------
Title: Chief Financial Officer
-----------------------
CHARTERMAC MORTGAGE PARTNERS CORP.
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇
---------------
Name: ▇▇▇▇ ▇▇▇▇▇▇
-----------
Title: Chief Financial Officer
-----------------------
LENDERS:
BANK OF AMERICA, N.A., as Agent and
as a Lender
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇
-----------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇
-------------
Title: Senior Vice President
---------------------
HSBC BANK USA, NATIONAL ASSOCIATION,
as a Lender
By: /s/ ▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
---------------------------
Name: ▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
-----------------------
Title: Vice President
--------------
[Signatures continued on next page]
(Amendment No.7 Sig. Pg.)
Accepted and Agreed:
CHARTER MAC CORPORATION, as Guarantor
CHARTER MAC CORPORATION, as Guarantor
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------
Title: Chief Operating Officer
-----------------------
CHARTERMAC, as Guarantor
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------
Title: Chief Financial Officer
-----------------------
(Amendment ▇▇. ▇ ▇▇▇. ▇▇.)
▇▇▇▇▇▇▇▇ ▇ TO LOAN AGREEMENT
----------------------------
COMMITMENTS: COMMITMENT PERCENTAGES; NOTICE ADDRESSES
-----------------------------------------------------
LENDER COMMITMENT COMMITMENT PERCENTAGE
--------------------------------------------------------------------------------
Bank of America, N.A. $50,000,000.00 50.0%
HSBC Bank USA $50,000,000.00 50.0%
FOR NOTICES:
Bank of America, N.A.
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇, Senior Vice President
Mail Stop: MA5-503-04-16
Fax No.: (▇▇▇) ▇▇▇-▇▇▇▇
HSBC Bank USA, National Association
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Vice President
Fax No.: (▇▇▇) ▇▇▇-▇▇▇▇