Exhibit 10.108(c)
AMENDMENT NUMBER 4 TO SECURITY AGREEMENT
THIS AMENDMENT NUMBER 4 TO SECURITY AGREEMENT, dated as of January 14, 2002
(this "AMENDMENT"), is entered into by and among FIRST INVESTORS AUTO
RECEIVABLES CORPORATION, a Delaware corporation (the "DEBTOR"), FIRST INVESTORS
FINANCIAL SERVICES, INC., a Texas corporation ("FIFS" or "SELLER"), FIRST
INVESTORS SERVICING CORPORATION, a Delaware corporation ("FISC" or the
"SERVICER"), VARIABLE FUNDING CAPITAL CORPORATION, a Delaware corporation,
("VFCC"), FIRST UNION SECURITIES, INC., a Delaware corporation ("FIRST UNION
SECURITIES"), MBIA INSURANCE CORPORATION, a New York stock insurance company,
("SURETY BOND PROVIDER") and ▇▇▇▇▇ FARGO BANK MINNESOTA, NATIONAL ASSOCIATION
("▇▇▇▇▇ FARGO"). Capitalized terms used and not otherwise defined herein are
used as defined in the Transaction Documents (as defined below).
WHEREAS, the parties hereto entered into that certain Security Agreement,
dated as of October 22, 1996, as amended by Amendment Number 1 to Security
Agreement, dated as of August 25, 1997, Amendment Number 2 to Security
Agreement, dated as of March 31, 1999, Amendment Number 3 to Security Agreement,
dated as of November 29, 2000 and the First Omnibus Amendment to Transaction
Documents, dated as of the date hereof (as amended, supplemented or restated to
the date hereof, the "SECURITY AGREEMENT");
WHEREAS, the parties hereto desire to amend the Security Agreement in
certain respects as provided herein;
NOW THEREFORE, in consideration of the premises and the other mutual
covenants contained herein, the parties hereto agree as follows:
SECTION 1. AMENDMENTS. Effective as of the Effective Date, the Security
Agreement is hereby amended as follows:
(a) The definition of "Adjusted LIBOR Rate" in Section 1.1 of the Security
Agreement is hereby modified, amended and restated to read in its entirety as
follows:
"ADJUSTED LIBOR RATE" means, with respect to any Collection Period, an
interest rate per annum equal to a fraction, expressed as a percentage
and rounded upwards (if necessary), to the nearest 1/100 of 1%, (i)
the numerator of which is equal to the LIBOR Rate for such Collection
Period and (ii) the denominator of which is equal to 100% MINUS the
Eurodollar Reserve Percentage for such Collection Period; PROVIDED,
however, the Adjusted LIBOR Rate shall be the Base Rate if a
Eurodollar Disruption Event occurs."
(b) The definition of "Carrying Costs" in Section 1.1 of the Security
Agreement is hereby modified, amended and restated to read in its entirety as
follows:
"CARRYING COSTS" shall mean for any Collection Period the sum of: (a)
the Accrued Interest; (b) without duplication of the amounts described
in clause (a) above, any amounts necessary to pay interest, calculated
at the Base Rate, with respect to amounts disbursed by the Credit
Support Provider in respect of Defaulted Receivables, if the Surety
Bond Provider shall have failed to make any required payment under the
Surety Bond in respect of such Defaulted Receivables, outstanding at
any time during such Collection Period accrued from the first day
through the last day of such Collection Period whether or not such
interest is payable during such Collection Period; (c) any past due
amounts not paid in clauses (a) and (b); (d) the costs to the Company
with respect to the Yield Protection Provision, which amounts are paid
pursuant to this clause (d) shall not exceed 1.00% per annum of the
Net Investment; and (e) the Program Fee and Unused Program Fee (the
sum of which shall not exceed .30% per annum of the Net Investment)
accrued from the first day through the last day of such Collection
Period whether or not such amount is payable during such Collection
Period.
(c) The definition of "Company" is hereby modified, amended and restated
to read in its entirety as follows:
"COMPANY" shall mean Variable Funding Capital Corporation and its
successors and assigns.
(d) The definition of "Eligible Receivables" is hereby amended by deleting
subsection (q) and substituting in lieu thereof, the following:
"(q) which has an original maturity of 66 months or less (provided,
however, that no more than 10% of the Principal Balance of any
Receivables pledged may have an original maturity of 61 to 66
months);"
(e) The definition of "Fee Letter" is hereby modified, amended and
restated to read in its entirety as follows:
"FEE LETTER" shall mean the letter agreement dated as of the Effective
Date, between the Company, the Administrative Agent and the Debtor in
respect of the payment by the Debtor of certain fees."
(f) The definition of "LIBOR Rate" is hereby modified, amended and
restated to read in its entirety as follows:
"LIBOR RATE" shall mean for any day during any Collection Period, an
interest rate per annum equal to:
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(i) the posted rate for 30-day deposits in United States Dollars
appearing on Telerate page 3750 as of 11:00 a.m. (London time) on the
Business Day which is the second Business Day immediately preceding
the first day of the applicable Collection Period; or
(ii) if no such rate appears on Telerate page 3750 at such time
and day, then LIBOR shall be determined by First Union National Bank
at its principal office in Charlotte, North Carolina as its rate (each
such determination, absent manifest error, to be conclusive and
binding on all parties hereto and their assignees) at which 30-day
deposits in United States Dollars are being, have been, or would be
offered or quoted by First Union National Bank to major banks in the
applicable interbank market for Eurodollar deposits at or about 11:00
a.m. (Charlotte, North Carolina time) on such day.
(g) The definition of "Termination Date" in Section 1.1 of the Security
Agreement is hereby amended by deleting clause (i) therein and substituting in
lieu thereof, the following:
"(i) January 13, 2003 unless such date shall be extended by the
parties hereto pursuant to a written document,"
(h) The following definitions are added in appropriate alphabetical order
in Section 1.1 of the Security Agreement:
(i) "ACCRUED INTEREST" shall mean for any Collection Period, the
sum of the Interest for each day during the Collection Period.
(ii) "ALTERNATIVE RATE" shall mean an interest rate per annum equal
to the Adjusted LIBOR Rate; PROVIDED, however, that the
Alternative Rate shall be the Base Rate if a Eurodollar
Disruption Event occurs.
(iii) "BREAKAGE COSTS" shall mean such amount or amounts as shall
compensate the Company for any loss, cost or expense incurred
by the Company (as determined by the Company (and by the
Administrative Agent on behalf of the Company) in such Person's
sole discretion) as a result of a prepayment by the Debtor of
the Interest or the Net Investment.
(iv) "CP RATE" shall mean for any day during any Collection Period,
the per annum rate equivalent to the weighted average of the
per annum rates paid or payable by the Company from time to
time as interest on or otherwise (by means of interest rate
▇▇▇▇▇▇ or otherwise taking into consideration any incremental
carrying costs associated with short-term promissory notes
issued by the Company maturing on dates other than those
certain dates on which the Company is to receive the funds) in
respect of
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promissory notes issued by the Company in the commercial paper
market that are allocated, in whole or in part, by the
Administrative Agent (on behalf of the Company) to fund or
maintain the Company's investment in the Note during such
Collection Period, as determined by the Administrative Agent
(on behalf of the Company) and reported to the Debtor which
rate shall reflect and give effect to (i) commissions of
placement agents and dealers in respect of such promissory
notes, to the extent such commissions are allocated, in whole
or in part, to such promissory notes by the Administrative
Agent (on behalf of the Deal Agent) and (ii) other borrowings
by the Company, including, without limitation, borrowings to
fund small or odd dollar amounts that are not easily
accommodated in the commercial paper market; PROVIDED, however,
that if any component -------- of such rate is a discount rate,
in calculating the CP Rate, the Administrative Agent shall for
such component use the rate resulting from converting such
discount rate to an interest bearing equivalent rate per annum.
(v) "EUROCURRENCY LIABILITIES": shall have the meaning specified in
Regulation D.
(vi) "EURODOLLAR DISRUPTION EVENT" shall mean the occurrence of any
of the following: (A) any Liquidity Provider shall have
notified the Administrative Agent of a determination by such
Liquidity Provider or any of its assignees or participants that
it would be contrary to law or to the directive of any central
bank or other governmental authority (whether or not having the
force of law) to obtain United States dollars in the London
interbank market to fund the Note or any interest therein, (B)
any Liquidity Provider shall have notified the Administrative
Agent of the inability, for any reason, of such Liquidity
Provider or any of its assignees or participants to determine
the Adjusted LIBOR Rate, (C) any Liquidity Provider shall have
notified the Administrative Agent of a determination by such
Liquidity Provider or any of its assignees or participants that
the rate at which deposits of United States dollars are being
offered to such Liquidity Provider or any of its assignees or
participants in the London interbank market does not accurately
reflect the cost to such Liquidity Provider, such assignee or
such participant of making, funding or maintaining any
Purchased Interest or (D) any Liquidity Provider shall have
notified the Administrative Agent of the inability of such
Liquidity Provider or any of its assignees or participants to
obtain United States dollars in the London interbank market to
make, fund or maintain the Note.
(vii) "EURODOLLAR RESERVE PERCENTAGE" with respect to any Reference
Bank for any period, shall mean the percentage applicable
during such period (or, if more than one such percentage shall
be so applicable, the daily average of such percentages for
those days in such period during which any such percentage
shall be so applicable) under regulations issued from time to
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time by the Board of Governors of the Federal Reserve System
(or any successor) for determining the maximum reserve
requirement (including, without limitation, any emergency,
supplemental or other marginal reserve requirement) with
respect to liabilities or assets consisting of or including
Eurocurrency Liabilities having a term of one month.
(viii) "INSURANCE AGREEMENT AMORTIZATION EVENT shall have the meaning
set forth in the Insurance Agreement.
(ix) "INTEREST" shall mean for any Collection Period with respect to
the Note, the sum of the products (for each day during such
Collection Period) of:
IR x NI x 1/360
where:
IR = the Interest Rate; and
NI = the Net Investment.
(x) "INTEREST RATE" shall mean with respect to the Notes, on any
day, (i) for the portion of the Net Investment that is funded
on such day through the issuance of Commercial Paper, the CP
Rate and (ii) for the portion of the Net Investment that is not
funded through the issuance of commercial paper, the
Alternative Rate.
(xi) "REFERENCE BANK" means any bank, which furnishes information
for purposes of determining the Adjusted LIBOR Rate.
(i) The following definitions in Section 1.1 of the Security Agreement are
hereby deleted:
(i) "Accrued Interest Component"
(ii) "Interest Component"
(iii) "Interest Rate"
(iv) "Principal Component"
(v) "Related Commercial Paper"
(j) Section 2.5 of the Security Agreement is hereby amended by deleting
clause (iv) and substituting in lieu thereof, the following:
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"after giving effect to any such increase, the Net Investment would
not exceed the Facility Limit;"
(k) Section 2.6 of the Security Agreement is hereby amended by deleting
the last two sentences of the first paragraph therein.
(l) Section 5.1(b) of the Security Agreement is hereby deleted.
(m) Section 5.1(c) of the Security Agreement is hereby amended by deleting
the word "Related" in clause (ii) in the second to last sentence therein.
(n) Section 5A.1(d)(iii) is hereby amended by deleting the word "Related"
in the first sentence therein.
(o) Section 6.1(d)(ii) is hereby modified, amended and restated to read in
its entirety as follows:
"(ii) the Net Investment equals or exceeds the Facility Limit or"
(p) Section 6.3 of the Security Agreement is hereby amended by adding a
new subsection (j) as follow:
"(j) the occurrence of an Insurance Agreement Amortization Event."
(q) Section 6.4 of the Security Agreement is hereby amended by deleting
the word "Related" in the second sentence therein.
(r) A new Section 8.13 is hereby added to the Security Agreement to read
as follows:
"Section 8.13 NO RECOURSE AGAINST CERTAIN PERSONS.
(a) No recourse under or with respect to any obligation, covenant or
agreement (including, without limitation, the payment of any fees or
any other obligations) of any Secured Party as contained in this
Agreement or any other agreement, instrument or document entered into
by it pursuant hereto or in connection herewith shall be had against
any administrator of such Secured Party or any incorporator,
affiliate, stockholder, officer, employee or director of such Secured
Party or of any such administrator, as such, by the enforcement of any
assessment or by any legal or equitable proceeding, by virtue of any
statute or otherwise; IT BEING EXPRESSLY AGREED AND UNDERSTOOD that
the agreements of such Secured Party contained in this Agreement and
all of the other agreements, instruments and documents entered into by
it pursuant hereto or in connection herewith are, in each case, solely
the corporate obligations of such Secured Party, and that no personal
liability whatsoever shall attach to or be incurred by any
administrator of such Secured Party or any incorporation,
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stockholder, affiliate, officer, employee or director of such Secured
Party or of any such administrator, as such, or any other of them,
under or by reason of any of obligations, covenants or agreements of
such Secured Party contained in this Agreement or in any other such
instruments, documents or agreements, or that are implied therefrom,
and that any and all personal liability of every such administrator of
such Secured Party and each incorporator, stockholder, affiliate,
officer, employee or director of such Secured Party or of any such
administrator, or any of them, for breaches by such Secured Party or
any such obligations, covenants or agreements, which liability may
arise either at common law or at equity, by statute or constitution or
otherwise, is hereby expressly waived as a condition of an in
consideration for the execution of this Agreement. The provisions of
this Section 5.9 shall survive the termination of this Agreement.
(b) Notwithstanding anything in this Agreement to the contrary, the
Company shall not have any obligation to pay any amount required to be
paid by it hereunder in excess of any amount available to the Company
after paying or making provision for the payment of its Commercial
Paper. All payment obligations of the Company hereunder are contingent
on the availability of funds in the excess of amounts necessary to pay
its Commercial Paper and each of the other parties hereto agrees that
it will not have a claim under Section 101(5) of the Bankruptcy Code
if and to the extent that any such payment obligation owed to it by
the Company exceeds the amount available to the Company to pay such
amount after paying or making the provision for the payment of its
Commercial Paper."
SECTION 2. EFFECTIVE DATE. This Amendment shall become effective as of the
date (the "EFFECTIVE DATE") on which each of the following conditions precedent
shall have been satisfied:
(a) AMENDMENT. The Company, the Surety Bond Provider and the
Administrative Agent shall have received multiple counterparts, as requested, of
this Amendment, executed and delivered by a duly authorized officer of each
party hereto.
(b) LIQUIDITY AGREEMENT. The Liquidity Purchase Agreement shall have been
duly executed by the parties thereto.
(c) FIRST OMNIBUS AMENDMENT TO TRANSACTION DOCUMENTS. Each of the
conditions set forth in Section 6 of the First Omnibus Amendment to Transaction
Documents shall have been satisfied.
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(d) OTHER INFORMATION. The Debtor shall have taken such other action,
including delivery of approvals, consents, opinions, documents and instruments,
as the Company, the Administrative Agent or the Surety Bond Provider may
reasonably request.
SECTION 3. MISCELLANEOUS.
(a) REFERENCES IN SECURITY AGREEMENT. Upon the effectiveness of this
Amendment, each reference in the Security Agreement to "this Agreement",
"hereunder", "hereof", "herein", or words of like import shall mean and be a
reference to the Security Agreement as amended hereby, and each reference to the
Security Agreement in any other Transaction Document or any other document,
instrument or agreement, executed and/or delivered in connection with any
Transaction Document shall mean and be a reference to the Security Agreement as
amended hereby.
(b) EFFECT ON SECURITY AGREEMENT. Except as specifically amended hereby,
the Security Agreement shall remain in full force and effect. This Amendment
shall not constitute a novation of the Security Agreement, but shall constitute
an amendment thereof.
(c) NO WAIVER. The execution, delivery and effectiveness of this Amendment
shall not operate as a waiver of any right, power or remedy of any Person under
the Security Agreement or any other document, instrument or agreement executed
in connection therewith, nor constitute a waiver of any provision contained
therein.
(d) SUCCESSORS AND ASSIGNS. This Amendment shall be binding upon and shall
inure to the benefit of the parties hereto and their respective successors and
assigns.
(e) COUNTERPARTS. This Amendment may be executed in any number of
counterparts, and by the different parties hereto on the same or separate
counterparts, each of which shall be deemed to be an original instrument but all
of which together shall constitute one and the same agreement. Delivery of an
executed counterpart of a signature page by facsimile shall be effective as
delivery of a manually executed counterpart of this Amendment.
(f) HEADINGS. The descriptive headings of the various sections of this
Amendment are inserted for convenience of reference only and shall not be deemed
to affect the meaning or construction of any of the provisions hereof.
(g) AMENDMENTS. This Amendment may not be amended or otherwise modified
except as provided in the Security Agreement.
(h) GOVERNING LAW. THIS AMENDMENT (INCLUDING, BUT NOT LIMITED TO, THE
VALIDITY AND ENFORCEABILITY HEREOF) SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH,THE LAWS OF THE STATE OF NEY YORK, OTHER THAN THE CONFLICT OF
LAW RULES THEREOF.
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IN WITNESS WHEREOF, the parties have caused this Amendment to be executed
by their respective officers thereunto duty authorized, as of the date first
above written.
FIRST INVESTORS AUTO RECEIVABLES
CORPORATION.
By:
------------------------------------
Name:
Title:
FIRST INVESTORS FINANCIAL SERVICES, INC.
By:
------------------------------
Name:
Title:
FIRST INVESTORS SERVICING CORPORATION
By:
------------------------------
Name:
Title:
FIRST UNION SECURITIES, INC.
By:
------------------------------
Name:
Title:
VARIABLE FUNDING CAPITAL CORPORATION
By First Union Securities, Inc.
as attorney-in-fact
By:
------------------------------
Name:
Title:
▇▇▇▇▇ FARGO BANK MINNESOTA,
NATIONAL ASSOCIATION
By:
------------------------------
Name:
Title:
MBIA INSURANCE CORPORATION
By:
------------------------------
Name:
Title: