SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15 (d) OF
THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): November 15, 1999
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IMC MORTGAGE COMPANY
(Exact name of registrant as specified in its charter)
Florida 333-3954 59-3350574
(State or other jurisdiction of (Commission file number) (I.R.S. employer
incorporation or organization) identification no.)
5901 E. Fowler Avenue,
Tampa, Florida 33617
(Address of principal executive offices) (Zip code)
Registrant's telephone number, including area code: (813) 984-2548
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Item 2. Acquisition or Disposition of Assets.
On November 15, 1999, IMC Mortgage Company (the "Company") consummated
the sale of its mortgage loan servicing business and substantially all of its
mortgage loan origination business to CitiFinancial Mortgage Company
("CitiFinancial Mortgage"). The shareholders of the Company approved the sale on
November 12, 1999.
The Company received $96 million from CitiFinancial Mortgage for the
sale of its mortgage servicing rights related to the mortgage loans which have
been securitized, real property consisting of the Company's Tampa, Florida
headquarters building and the Company's leased facilities at its Ft. Washington,
Pennsylvania, Cherry Hill, New Jersey and Cincinnati, Ohio office locations.
Additionally, all furniture, fixtures and equipment and other personal property
located at the premises described above was included in the purchase.
Substantially all of the employees at the locations referred to above were
offered employment by CitiFinancial Mortgage. The Company will receive an
additional $4 million of sale proceeds over the next two years from
CitiFinancial Mortgage for this sale if certain conditions are met.
In addition to the purchase price, pursuant to a Delinquency and
Servicing Advance Purchase Agreement, CitiFinancial Mortgage reimbursed the
Company for servicing advances made by the Company in its capacity as servicer.
As servicer of these loans, the Company is required to advance certain interest
and escrow amounts to the securitization trusts for delinquent mortgagors and to
pay expenses related to foreclosure activities. The Company then collects the
amounts from the mortgagors or from the proceeds from liquidation of foreclosed
properties. The amounts owed to the Company for reimbursement of servicing
advances made in connection with escrow and foreclosure servicing advances
approximated $42.6 million at November 15, 1999, and amounts owed to the Company
for reimbursement of servicing advances made in connection with delinquent
interest payments were $9.8 million at November 15, 1999. The escrow and
foreclosure servicing advances, which are typically recovered by the servicer of
loans over a period of up to two years, were acquired by CitiFinancial Mortgage
at a discount of 10.45%. The delinquent interest servicing advances, which are
typically repaid to the servicer of loans monthly, were acquired by
CitiFinancial Mortgage at a discount of $3.0 million. The Delinquency and
Servicing Advance Purchase Agreement is attached hereto as an exhibit and is
incorporated herein by reference in its entirety.
The proceeds from the sale were used to repay certain indebtedness
secured by certain assets of the Company. The Company's assets remaining after
the sale to CitiFinancial Mortgage will either be held or sold by the Company to
attempt to realize the maximum value for these assets and repay its obligations.
If the Company receives sufficient proceeds from the remaining assets to repay
its obligations, any remaining proceeds will be used first to redeem the
Company's outstanding preferred stock and then to make payments to the Company's
common shareholders. The Company believes any payment to common shareholders is
unlikely but will ultimately depend upon the proceeds received from the
remaining assets. If any proceeds remain for the Company's common shareholders,
these proceeds would be available only after repayment of the
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Company's obligations and the redemption of the Company's preferred stock, which
are not expected to be made for several years.
Simultaneously, the Company, its major warehouse lenders and Greenwich
Street Capital Partners II, L.P. and certain of its affiliates entered into
second amended and restated intercreditor agreements (the "Second Amended and
Restated Intercreditor Agreements"). Under those agreements, the lenders agreed
to keep their respective facilities in place so long as the obligations owed to
these lenders are repaid in accordance with the terms of the Second Amended and
Restated Intercreditor Agreements and certain events of default as described in
the Second Amended and Restated Intercreditor Agreements do not occur. The
foregoing summary is qualified by reference to the full text of the Second
Amended and Restated Intercreditor Agreements, which are attached hereto as
exhibits and are incorporated herein by reference in their entirety.
In conjunction with the consummation of the sale of certain assets to
CitiFinancial Mortgage, Dennis Pitocco was named President, Chief Operating
Officer and Chief Financial Officer of the Company. Mr. Pitocco succeeds the
Company's President and Chief Operating Officer Thomas Middleton and the
Company's Chief Financial Officer Stuart Marvin. Mr. Pitocco will also be
assuming the duties of the Chief Executive Officer on an interim basis, as the
Company's Chairman and Chief Executive Officer George Nicholas is recovering
from a recent illness. In November 1999, the Company and Mr. Pitocco entered
into an employment agreement. The employment agreement is attached hereto as an
exhibit and is incorporated herein by reference in its entirety.
Item 7. Financial Statements, Pro Forma Financial Information
and Exhibits.
(c) Exhibits
10.81 Second Amended and Restated Intercreditor Agreement, dated
as of November 10, 1999, between IMC Mortgage Company,
Greenwich Street Capital Partners II, L.P., Greenwich Fund,
L.P., GSCP Offshore Fund, L.P., Greenwich Street Employees
Fund, L.P., TRV Executive Fund, L.P., and Paine Webber Real
Estate Securities Inc.
10.82 Second Amended and Restated Intercreditor Agreement, dated
as of November 10, 1999, between IMC Mortgage Company,
Greenwich Street Capital Partners II, L.P., Greenwich Fund,
L.P., GSCP Offshore Fund, L.P., Greenwich Street Employees
Fund, L.P., TRV Executive Fund, L.P., and German American
Capital Corporation.
10.83 Second Amended and Restated Intercreditor Agreement, dated
as of November 10, 1999, between IMC Mortgage Company,
Greenwich Street Capital Partners II, L.P., Greenwich Fund,
L.P.,
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GSCP Offshore Fund, L.P., Greenwich Street Employees Fund,
L.P., TRV Executive Fund, L.P., and Bear Stearns Home
Equity Trust, Bear, Stearns International Limited, and any
of their affiliates which are or become party thereto.
10.84 Second Amended and Restated Intercreditor Agreement, dated
as of November 10, 1999, between IMC Mortgage Company,
Greenwich Street Capital Partners II, L.P., Greenwich Fund,
L.P., GSCP Offshore Fund, L.P., Greenwich Street Employees
Fund, L.P., and TRV Executive Fund, L.P.
10.85 Intercreditor Agreement, dated as of November 10, 1999,
between IMC Mortgage Company, Greenwich Street Capital
Partners II, L.P., Greenwich Fund, L.P., GSCP Offshore
Fund, L.P., Greenwich Street Employees Fund, L.P., TRV
Executive Fund, L.P., Neal Henschel and Jeffrey M.
Henschel.
10.86 Employment Agreement, dated as of November 1, 1999, between
IMC Mortgage Company and Dennis J. Pitocco.
10.87 Delinquency and Servicing Advance Purchase Agreement, dated
as of November 15, 1999, between IMC Mortgage Company and
CitiFinancial Mortgage Company.
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
IMC Mortgage Company has duly caused this report to be signed on its behalf by
the undersigned thereunto duly authorized.
Date: November 24, 1999 IMC MORTGAGE COMPANY
By: /s/ Dennis Pitocco
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Dennis Pitocco
President, Chief Operating
Officer and Chief Financial
Officer
Exhibit 10.81
SECOND AMENDED AND RESTATED INTERCREDITOR AGREEMENT
(Paine Webber)
SECOND AMENDED AND RESTATED INTERCREDITOR AGREEMENT, dated as
of November 10, 1999, between IMC MORTGAGE COMPANY, a Florida corporation (the "
Company"), GREENWICH STREET CAPITAL PARTNERS II, L.P., a Delaware limited
partnership ("GSCP"), GREENWICH FUND, L.P., a Delaware limited partnership, GSCP
OFFSHORE FUND, L.P., a Cayman Islands exempted limited partnership, GREENWICH
STREET EMPLOYEES FUND, L.P., a Delaware limited partnership, TRV EXECUTIVE FUND,
L.P., a Delaware limited partnership (each a "Facility Lender" and collectively,
the "Facility Lenders"), and PAINE WEBBER REAL ESTATE SECURITIES INC., a
Delaware corporation (the "Existing Lender"). Capitalized terms used in this
Agreement without definition have the meanings given to them in the Loan
Agreement (as hereinafter defined) as such terms are defined in the Loan
Agreement on the date hereof (or as amended by any amendment thereto approved by
the Existing Lender).
RECITALS
A. The Company has entered into a Loan Agreement, dated as of
October 12, 1998, amended by Amendment No. 1 thereto, dated as of February 11,
1999 (as the same may be further modified, supplemented or restated from time to
time, the "Loan Agreement"), between the Company, as borrower, and the Facility
Lenders, pursuant to which the Facility Lenders have extended to the Company
loans in the aggregate principal amount of $38,000,000 (the "Loans"), subject to
the terms and conditions set forth in the Loan Agreement, which Loans are
evidenced by the Notes and entitled to the benefit of certain guarantees and
security provided to the Facility Lenders or to GSCP, as collateral agent (the
"Collateral Agent") under certain of the other Loan Documents.
B. The Facility Lenders have made certain additional loans to
the Company pursuant to Note Purchase and Amendment Agreement No. 6, dated as of
October 18, 1999, in the original principal amount of $61,500,000 (the "Facility
Lender Advances") to fund certain monthly delinquent interest servicing advances
in respect of the Company's securitizations.
C. Pursuant to a Loan and Security Agreement, dated as of
February 28,
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1998, as amended from time to time, by and among the Company and certain of its
Subsidiaries, (the "Existing Loan Agreement"), and other related agreements in
favor of the Existing Lender (collectively with the Existing Loan Agreement, the
"Existing Loan Documents"), the Existing Lender has agreed to provide financing
to the Company from time to time, to enable the Company to finance certain
mortgage loans and for other purposes provided therein; and the Company and
certain of its Subsidiaries have granted a security interest in the Collateral
(as hereinafter defined) in order to secure their respective obligations under
the Existing Loan Documents (the "Existing Obligations").
D. The Company entered into an Acquisition Agreement (the
"Acquisition Agreement"), dated as of February 19, 1999, by and among each of
the Facility Lenders and the Company, pursuant to which the Company would issue
and deliver to the Facility Lenders common stock, par value $0.001 per share, of
the Company representing approximately 93.5% of the Common Stock outstanding
after such issuance.
E. The Company has (i) terminated the Acquisition Agreement
and (ii) entered into an Asset Purchase Agreement, dated as of July 13, 1999, as
amended by Addendum No. 1 thereto, dated September 7, 1999 and a Delinquency and
Servicing Advance Purchase Agreement (collectively, the "Asset Purchase
Agreement"), between the Company and CitiFinancial Mortgage Company, a Delaware
corporation ("CMC "), pursuant to which CMC would acquire certain assets and
assume certain liabilities of the Company (the "Asset Sale").
F. The Company, the Facility Lenders and the Existing Lender
have previously entered into an Intercreditor Agreement, dated as of October 12,
1998, amended and restated by the Amended and Restated Intercreditor Agreement,
dated as of February 18, 1999 and amended further by Amendment No. 1 to Amended
and Restated Intercreditor Agreements, dated as of March 31, 1999, and letter
agreements dated as of July 15, 1999, August 11, 1999, September 14, 1999 and
October 15, 1999 (as so amended and restated, the "Original Intercreditor
Agreement"). In connection with the entry by the Company into the Asset Purchase
Agreement, the Facility Lenders, the Company and the Existing Lender have agreed
to enter into this agreement amending and restating the Original Intercreditor
Agreement (as so amended and restated, the "Agreement").
G. The Company issued a Promissory Note, dated as of July 1,
1997, in the amount of $12,975,864.30 (as amended and including any additional
Promissory
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Notes delivered pursuant to the Henschel Intercreditor Agreement (defined
below), the "NH Note") to Neal Henschel ("NH"), and a Promissory Note, dated as
of July 1, 1997, in the amount of $1,441,762.70 (as amended and including any
additional Promissory Notes delivered pursuant to the Henschel Intercreditor
Agreement, the "JH Note", and, together with the NH Note, the "Notes") to
Jeffrey M. Henschel ("JH", and together with NH, the "Henschels"), pursuant to
which the Company has certain unsecured payment obligations to the Henschels
(the "Henschel Note Obligations").
H. The Company, the Facility Lenders, NH and JH have entered
into an Intercreditor Agreement, dated as of the date hereof (the "Henschel
Intercreditor Agreement"), pursuant to which the Henschels have agreed not to
take certain actions specified therein and the Company has agreed to make
certain payments to amortize the Henschel Note Obligations as provided therein.
NOW THEREFORE, for good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the Company, the
Existing Lender and the Facility Lenders agree to amend and restate the Original
Intercreditor Agreement to read in its entirety as follows:
Section 1. Standstill. (a) Each of the Facility Lenders and
the Existing Lender agrees, subject to the terms of this Agreement, that for the
Standstill Period, it shall not:
(i) file or join in the filing of any involuntary petition in
bankruptcy with respect to the Company or its Subsidiaries, or initiate
or participate in any similar proceedings for the benefit of creditors,
including any proceeding for the appointment of a trustee, receiver,
conservator or liquidator of the Company or its Subsidiaries or any
portion of its assets;
(ii) seek to collect or enforce by litigation or otherwise,
any payment obligations under the Existing Loan Documents or the Loan
Documents; provided that nothing in this Section 1 shall prohibit the
Facility Lenders from exercising their Exchange Option;
(iii) make any Margin Calls or other demands for payment in
respect of, or additional collateral to secure the Existing
Obligations; provided, however, that this clause shall not adversely
affect the right of the Existing Lender to take any actions to
preserve, protect or perfect its liens in the Collateral;
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(iv) declare a default or event of default under, or exercise
or enforce any right or remedy under, or accelerate the maturity of any
Existing Obligation or Loan under, any Existing Loan Document or Loan
Document; or
(v) seek to attach, sequester or otherwise proceed against any
of the Collateral, except as provided in Section 8(f) hereof.
(b) The Standstill Period may be terminated by the Existing
Lender or the Facility Lenders by written notice to the Company and each other
Creditor upon the occurrence of any of the following:
(i) a failure by the Company under the Existing
Loan Agreement to make to the Existing Lender any scheduled payment of
interest, which failure continues unremedied for two days;
(ii) any intentional fraud or misrepresentation by
the Company;
(iii) immediately in the event any Other Existing
Lender takes any of the actions described in Section 1(a) of its Other
Intercreditor Agreement or either of the Henschels takes any of the
actions described in Section 1(a) of the Henschel Intercreditor
Agreement, or, in the case of the Existing Lender, immediately in the
event any Facility Lender takes any of the actions described in Section
1(a) of this Agreement, or, in the case of the Facility Lenders,
immediately in the event the Existing Lender takes any of the actions
described in Section 1(a) of this Agreement or either of the Henschels
takes any of the actions described in Section 1(a) of the Henschel
Intercreditor Agreement, in each case whether or not it shall have
given notice of termination of the Standstill Period;
(iv) a Change of Control or payment of the Take-Out
Premium, except to the extent payable in accordance with Section 5
hereof;
(v) an event shall occur and be continuing for a
period of ten Business Days which permits (x) any holder of
indebtedness for borrowed money of the Company or the Designated
Subsidiary outstanding (other than the Company or any Creditor or
Residential Funding Corporation) to accelerate the
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maturity of such indebtedness or (y) any holder of such indebtedness or
any holder of any guarantee or other obligation of the Company or the
Designated Subsidiary to exercise remedies with respect to property of
the Company or the Designated Subsidiary (other than the Company or
Residential Funding Corporation solely with respect to the Mortgage
Loans held by it as collateral for its existing loan), without such
indebtedness being paid or the rights of such holder to take such
action being waived, stayed or subjected to a standstill or other
agreement of such holder to forbear from exercising remedies,
reasonably satisfactory to the Creditors;
(vi) the Company shall, at any time on or after the
date of the closing of the Asset Sale, repay all or any portion of the
Loans, except any such repayment of the Loans in accordance with
Section 5 hereof;
(vii) The Company shall fail to make any payment
required to be made in accordance with Section 5 or 14 hereof;
(viii) The Company shall incur or pay any Operating
Expenses or incur or pay any obligations, except as expressly
contemplated hereby or by the Monthly Statement.
(ix) The Company shall breach the covenant set
forth in Section 8(g) or Section 5(h) hereof.
(c) The Standstill Period shall terminate automatically
without notice or other action by any Creditor upon the occurrence of any of the
following:
(i) the Company or any Designated Subsidiary shall
consent to the appointment of or taking possession by a receiver,
assignee, custodian, sequestrator, trustee or liquidator (or other
similar official) of itself or of a substantial part of its property;
or the Company or any Designated Subsidiary shall admit in writing (to
any creditor, governmental authority or judicial court or tribunal) its
inability to pay its debts generally as they come due or shall fail
generally to pay its debts as they become due, or shall make a general
assignment for the benefit of its creditors; or the Company or any
Designated Subsidiary shall file a voluntary petition in bankruptcy or
a voluntary petition or answer seeking liquidation, reorganization or
other relief with respect to itself or its debts under the Federal
bankruptcy laws, as now or hereafter constituted or any other
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applicable Federal or State bankruptcy, insolvency or other similar
law, or shall consent to the entry of an order for relief in an
involuntary case under any such law; or the Company or any Designated
Subsidiary shall file an answer admitting the material allegations of
a petition filed against the Company or such Designated Subsidiary in
any such proceeding, or otherwise seek relief under the provisions of
any existing or future Federal or State bankruptcy, insolvency or other
similar law providing for the reorganization or winding-up of
corporations, or providing for an arrangement, agreement,
composition, extension or adjustment with its creditors; or the
Company or any Designated Subsidiary shall take or publicly announce
its intention to take corporate action in furtherance of any of the
foregoing; or
(ii) an order, judgment or decree shall be entered in
any proceeding by any court of competent jurisdiction appointing,
without the consent of the Company, a receiver, trustee or liquidator
of the Company or any Designated Subsidiary or of any substantial part
of their respective property, or any substantial part of the property
of the Company or any Designated Subsidiary shall be sequestered, and
any such order, judgment or decree of appointment or sequestration
shall remain in force undismissed, unstayed or unvacated for a period
of 30 days after the date of entry thereof; or
(iii) an involuntary petition against the Company or
any Designated Subsidiary in a proceeding under the Federal bankruptcy
laws or other insolvency laws, as now or hereafter in effect, shall be
filed and shall not be withdrawn or dismissed within 30 days
thereafter, or a decree or order for relief in respect of the Company
or any Designated Subsidiary shall be entered by a court of competent
jurisdiction in an involuntary case under the Federal bankruptcy laws,
as now or hereafter constituted, or, under the provisions of any law
providing for reorganization or winding-up of corporations which may
apply to the Company or any Designated Subsidiary, any court of
competent jurisdiction shall assume jurisdiction, custody or control
of the Company or any Designated Subsidiary or of any substantial part
of their respective property and such jurisdiction, custody or
control shall remain in force unrelinquished, unstayed or
unterminated for a period of 30 days.
<PAGE>
Section 2. Grant of Security Interest. (a) In order to secure
full and timely payment of the Obligations under the Loan Agreement, and to
secure the performance of all of the other obligations of the Company under the
Loan Documents, the Company and each Subsidiary hereby mortgages, pledges and
assigns and transfers to the Facility Lenders, and grants to the Facility
Lenders, a continuing perfected security interest in, and a lien in the
Collateral. The Facility Lenders agree to release their lien in respect of any
Pledged Loan, which is sold by the Company (i) to the Existing Lender for a
purchase price not less than the advance rate (or, in the case of any Sixty Day
Mortgage Loans or Ninety Day Mortgage Loans, at not less than 80% or 68.6% of
the principal outstanding on such Mortgage Loans, respectively) in respect of
such Pledged Loan, (ii) pursuant to Section 8(f) hereof, (iii) pursuant to a
securitization of Mortgage Loans, or (iv) in a sale to an unaffiliated third
party.
(b) The Facility Lenders agree for the benefit of the Existing Lender
that during the continuance of the Standstill Period and thereafter until the
earlier of (i) 91 days after the satisfaction of the Existing Obligations in
full, (ii) the exercise by the Existing Lender of any right to attach,
sequester, foreclose or otherwise exercise remedies with respect to the
Collateral, and (iii) 180 days after the expiration or earlier termination of
the Standstill Period, the Facility Lenders will not seek to attach, sequester,
foreclose, levy on or otherwise exercise remedies with respect to the
Collateral, provided that nothing in this Section 2(b) shall restrict the
Facility Lenders from commencing suit on its Notes or for payment of its Loan,
the BankBoston Debt, the Facility Lender Advances or enforcement (other than by
exercising remedies with respect to the Collateral) of any other obligation
owing to it under the Loan Documents or otherwise by the Company.
Section 3. Acknowledgment and Priorities. (a) The Existing
Lender hereby acknowledges and consents to the entrance by the Company into the
Loan Documents and the granting of the lien in the Collateral granted pursuant
to Section 2; provided, however , notwithstanding anything to the contrary
contained in the Loan Agreement, the Notes or any of the Loan Documents, the
parties hereto acknowledge and agree that any security interest in or other
rights with respect to any Collateral granted to secure the Existing Obligations
under the Existing Loan Agreement or otherwise has and shall have priority over
any security interest in such Collateral granted pursuant to this Agreement, the
Loan Agreement or the other Loan Documents irrespective of:
(i) the time, order or method of attachment or perfection of
the security interest created by this Agreement, the Loan Agreement or
any Loan Document;
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(ii) the time or order of filing or recording of financing
statements or other documents filed or recorded to perfect security
interests in any Collateral;
(iii) anything contained in any filing or agreement to which
the Facility Lenders, the Company, or the Collateral Agent under the
Security Documents now or hereafter may be a party, and
(iv) the rules for determining priority under the UCC or other
laws governing the relative priorities of secured creditors.
(b) The Existing Lender hereby agrees, and the Company
acknowledges, that, promptly following the expiration of 91 days after payment
in full of all the Existing Obligations hereunder, any Collateral, including any
books and records (including, without limitation, computer files, printouts and
other computer materials and records) relating to the Collateral, as well as all
proceeds and products of such Collateral, held by it shall be held for the
benefit of the Facility Lenders, provided that if such Collateral is then
subject to the prior lien of another creditor, the Existing Lender may hold it
for the benefit of such other creditor and the Facility Lenders as their
interests may appear. If the Existing Lender has elected not to hold such
Collateral following payment in full of the Existing Obligations, it shall
promptly forward any Collateral, including any books and records (including,
without limitation, computer files, printouts and other computer materials and
records) relating to the Collateral, as well as all proceeds and products of
such Collateral, to the Collateral Agent, provided that if such Collateral is
then subject to the prior lien of another creditor, the Existing Lender may
forward such Collateral, proceeds and products thereof to such other creditor
or, in the event of a dispute, to such party as a court of competent
jurisdiction may direct.
(c) Nothing contained in this Agreement shall alter or impair
the Existing Lender's rights under the Existing Loan Documents from and after
the termination of the Standstill Period in accordance herewith or be
interpreted to mean that the Existing Lender has any obligation under the
Existing Loan Documents or otherwise to return any proceeds received on a sale
or deemed sale of any Pledged MBS or Pledged Loan to the Company or any
Subsidiary, except as expressly provided herein.
(d) Each of the parties hereto consents to the transactions
contemplated by the Asset Purchase Agreement.
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Section 4. Reserved Rights. (a) Notwithstanding anything in
this Agreement to the contrary, the Company and the Facility Lenders agree that
this Agreement shall in no manner impair any right of the Existing Lender under
the Existing Loan Agreement to enforce any condition precedent to any obligation
it may have thereunder to make future Advances to the Company and its
Subsidiaries, nor shall this Agreement limit the right of the Existing Lender to
make Margin Calls in respect of the hedging transactions with respect to U.S.
treasury securities that the Company may have entered into with the Existing
Lender outside of the Existing Loan Documents. All rights and obligations of the
Existing Lender under the Existing Loan Documents to make Advances or not make
Advances shall not be affected by this Agreement.
(b) In addition and notwithstanding anything to the contrary
contained herein (but subject to Section 8(f) hereof), this Agreement shall not
(i) apply to any Advances made from and after the date hereof, or any other
obligation of the Company or any of its Subsidiaries to the Existing Lender or
any of its Affiliates incurred from and after the date hereof or (ii) limit the
rights of the Existing Lender or any Affiliate thereof (x) subject to Section
8(f) hereof, to purchase Mortgage Loans from the Company or any of its
Subsidiaries, (y) to receive principal and/or interest at the applicable
mortgage rate on mortgage loans purchased by the Existing Lender or any such
Affiliate from the Company or any of its Subsidiaries or (z) to sell mortgage
loans to the Company or any of its Subsidiaries, in each case including without
limitation the rights of the Existing Lender under (A) the Mortgage Loan
Purchase Agreement, dated as of October 9, 1998, among the Existing Lender, the
Company and certain of its Subsidiaries and (B) the Mortgage Loan Purchase
Agreement, dated as of December 9, 1998, between the Company and the Existing
Lender.
Section 5. Amortization. During the Standstill Period, the
following provisions contained in this Section 5 shall apply:
(a) From and after the date this Agreement becomes effective
and prior to the date of the closing of the Asset Sale, within five days
following receipt by the Existing Lender each month of Available Cash Flow from
Securitization Receivables, the Existing Lender shall apply ninety percent (90%)
of such Available Cash Flow from Securitization Receivables to the repayment of
principal of the Existing Obligations under the Existing Loan Documents secured
by the Pledged MBS's generating such Available Cash Flow from Securitization
Receivables and shall remit the balance of such Available Cash Flow from
Securitization Receivables to the Company.
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(b) Upon the closing of the Asset Sale, the Company shall pay
to the Existing Lender the sum of (x) its Pro-Rata Share of the product of (A)
seventy percent (70%) and (B) the Transaction Proceeds Amount, plus (y) the
Warehouse Debt Shortfall with respect to the Existing Lender and minus (z) the
Henschel Make-Up Amount, in each case to be applied to repayment of principal of
the Existing Obligations under the Existing Loan Documents.
(c) Upon the closing of the Asset Sale, the Company shall pay
to the Facility Lenders and the Henschels, as their interests may appear
pursuant to the Henschel Intercreditor Agreement, the sum of (x) the product of
(A) thirty percent (30%) and (B) the Transaction Proceeds Amount plus (y) the
product of (A) three (3) and (B) the Henschel Make-Up Amount, in the case of the
Facility Lenders, to be applied to repayment of principal of the BankBoston Debt
until such Debt is paid in full, and then to repayment of the Loans and any
other obligations due the Facility Lenders, and, in the case of the Henschels,
to be applied to repayment of the Henschel Note Obligations.
(d) Upon the closing of the Asset Sale, the Company shall pay
to the Facility Lenders the sum of the CMC Advance Proceeds and the Delinquent
Interest Advance Shortfall Amount, in each case to be applied to repayment of
all obligations owing in respect of any outstanding Facility Lender Advances.
(e) Upon the closing of the Asset Sale, the Company shall pay
or reimburse the Existing Lender and the Facility Lenders for any Transaction
Expenses and Professional Fees then due and owing.
(f) Upon the closing of the Asset Sale, the Company shall
cause CMC to pay the Tax Escrow Amount to the escrow agent under the Tax Escrow
Agreement for deposit thereunder and application in accordance with the terms
thereof.
(g) Upon the closing of the Asset Sale, the Company shall
cause CMC to pay the Securitization Escrow Amount to the escrow agent under the
Securitization Escrow Agreement for deposit thereunder and application in
accordance with the terms thereof.
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(h) Upon the closing of the Asset Sale, the Company shall
cause CMC to deposit a portion of the sale proceeds in an amount equal to the
NLC Amount in a separate bank account with a bank reasonably satisfactory to the
Creditors, solely for the benefit of the Creditors (and not for the benefit of
the Company), and not commingled with any funds of the Company, which shall be
applied from time to time solely for the purpose of making advances for
warehouse financing to National Lending Center, Inc., such warehouse financing
to mature not later than 90 days after the closing of the Asset Sale and to be
on terms and pursuant to documentation reasonably satisfactory to the Creditors,
which financing shall provide for all repayments in respect of such financing to
be paid directly for deposit to such account. Upon the date which is 90 days
after the closing of the Asset Sale and from time to time thereafter upon
receipt of the net proceeds of such warehouse financing, the amount on deposit
in such account shall, pursuant to irrevocable instructions given by the Company
at or before the closing of the Asset Sale, be immediately paid to the escrow
agent under the NLC Escrow Agreement for deposit and application thereunder.
(i) Upon the closing of the Asset Sale, the Company shall
apply the SafeCo Shortfall Amount to payment of the insurance premiums payable
to SafeCo.
(j) Upon the closing of the Asset Sale, the Company shall pay
to the Existing Lender and the Facility Lenders any accrued and unpaid interest
on the Existing Obligations, the BankBoston Debt and the Loan Agreement to but
not including the date of such closing.
(k) Any Reserve Release shall be made by the relevant escrow
agent pursuant to the Securitization Escrow Agreement, the NLC Escrow Agreement
or the Tax Escrow Agreement, as the case may be, to the Existing Lender, the
Other Existing Lenders, the Facility Lenders and the Henschels, as their
interests may appear pursuant to such escrow agreements.
(l) Promptly upon receipt by the Company of any Mortgage Sale
Excess Proceeds, the Company shall pay (x) to the Existing Lender an amount
equal to its Pro-Rata Share of the product of seventy percent (70%) and any
Mortgage Sale Excess Proceeds, to be applied to repayment of principal of the
Existing Obligations under the Existing Loan Documents, and (y) to the Facility
Lenders and the Henschels, as their interests may appear pursuant to the
Henschel Intercreditor Agreement, the product of thirty percent (30%) and any
Mortgage Sale Excess Proceeds, in the case of the Facility Lenders, to be
applied to repayment of principal of the BankBoston Debt until such Debt
<PAGE>
is paid in full, and then to repayment of the Loans and any other obligations
due the Facility Lenders, and, in the case of the Henschels, to be applied to
repayment of the Henschel Note Obligations.
(m) Promptly upon the sale of any Mortgage Loan securing (or
purchased subject to a repurchase obligation comprising) any Existing
Obligations that gives rise to a Mortgage Sale Shortfall, the Company shall pay
the Existing Lender the amount of such Mortgage Sale Shortfall.
(n) Within five days following receipt by the Existing Lender
of Available Cash Flow from Securitization Receivables during the month in which
the closing of the Asset Sale occurs, the Existing Lender shall (a) apply ninety
percent (90%) of the Available Cash Flow from Securitization Receivables for
such month to the repayment of principal of the Existing Obligations under the
Existing Loan Documents and (b) remit the balance of such Available Cash Flow
from Securitization Receivables to the Facility Lenders for payment to the
Facility Lenders and the Henschels, as their interests may appear pursuant to
the Henschel Intercreditor Agreement, in the case of the Facility Lenders, for
application to the repayment of principal of the BankBoston Debt, until such
Debt is paid in full, and then to repayment of principal of the Loans and any
other obligations due the Facility Lenders, and, in the case of the Henschels,
to be applied to repayment of the Henschel Note Obligations.
(o) Not later than the 15th calendar day (or the next business
day, if the 15th is not a business day) after the end of each calendar month
ending on or after the closing of the Asset Sale, the Company shall prepare and
deliver to the Existing Lender a Monthly Statement and, following the receipt of
such Monthly Statement by the Existing Lender, the Available Post-Transaction
Cash Flow with respect to such month shall be distributed in each such month as
follows:
(i) within five days following receipt by the Existing Lender of
the Monthly Statement for such month but not sooner than one
business day after receipt by the Existing Lender of the
Available Cash Flow from Securitization Receivables paid to
the Existing Lender that month, the Existing Lender or the
Collateral Agent, if it shall have received the
<PAGE>
Collateral pursuant to Section 3(b) hereof, shall remit to the
Company the Existing Lender's Allocable Share of the Monthly
Cash Flow Shortfall Amount, if any, from such Available Cash
Flow from Securitization Receivables, if any; provided , that
in the event there is a dispute (including any dispute arising
from the failure of the requisite Creditors to approve any
Monthly Statement) with respect to the calculation of the
Monthly Cash Flow Shortfall Amount, the Existing Lender shall
remit to the Company such portion of the Monthly Cash Flow
Shortfall Amount as calculated by the Company as is not in
dispute and shall remit any balance promptly upon resolution
of such dispute (it being understood and agreed that the
Existing Lender's obligation under this clause (i) for any
month shall not exceed the Available Cash Flow from
Securitization Receivables actually received that month);
(ii) until such time as the Existing Obligations have been repaid
in full:
(A) the Existing Lender shall (a) apply ninety percent (90%)
of the Available Cash Flow from Securitization Receivables for
such month remaining after the payment, if any, of the
Existing Lender's Allocable Share of the Monthly Cash Flow
Shortfall Amount pursuant to subsection (i) above, to the
repayment of principal of the Existing Obligations under the
Existing Loan Documents and (b) remit the balance, if any, of
such Available Cash Flow from Securitization Receivables to
the Facility Lenders for payment to the Facility Lenders and
the Henschels, as their interests may appear pursuant to the
Henschel Intercreditor Agreement, in the case of the Facility
Lenders, for application to the repayment of principal of the
BankBoston Debt, until such Debt is paid in full, and then to
repayment of principal of the Loans and any other obligations
due the Facility Lenders, and, in the case of the Henschels,
to be applied to repayment of the Henschel Note Obligations;
and
(B) the Company shall (a) remit to the Existing Lender for
application to the repayment of principal of the Existing
Obligations under the Existing Loan Documents the Existing
Lender's Allocable Share of an amount equal to 90% of the
Monthly Free Cash Flow Amount, if any, and (b) remit an amount
equal to 10% of the Monthly Free Cash Flow Amount to the
Facility Lenders for payment to the Facility Lenders and the
Henschels, as their interests may appear pursuant to the
Henschel Intercreditor Agreement, in the case of the Facility
Lenders, to be applied
<PAGE>
to repayment of principal of the BankBoston Debt until such
Debt is paid in full, and then to repayment of principal of
the Loans and any other obligations due the Facility Lenders,
and, in the case of the Henschels, to be applied to repayment
of the Henschel Note Obligations.
(iii) after such time as the Existing Obligations shall have been
repaid in full and until all obligations due to the Facility
Lenders and the Henschels have been paid in full:
(A) the Existing Lender, or the Collateral Agent, if it shall
have received the Collateral pursuant to Section 3(b) hereof,
shall remit the Existing Lender's Allocable Share of the
Monthly Cash Flow Shortfall Amount to the Company as provided
in subsection (i) above and remit 100% of the Available Cash
Flow from Securitization Receivables remaining after the
remittance, if any, in respect of the Monthly Cash Flow
Shortfall Amount pursuant to subsection (i) above, to the
Facility Lenders for payment to the Facility Lenders and the
Henschels, as their interests may appear pursuant to the
Henschel Intercreditor Agreement, in the case of the Facility
Lenders, to be applied to repayment of principal of the
BankBoston Debt until such Debt is paid in full, and then to
repayment of principal of the Loans and any other obligations
due the Facility Lenders, and, in the case of the Henschels,
to be applied to repayment of the Henschel Note Obligations,
and
(B) the Company shall remit 100% of the Monthly Free Cash Flow
Amount, if any, to the Facility Lenders and the Henschels, as
their interests may appear pursuant to the Henschel
Intercreditor Agreement, in the case of the Facility Lenders,
to be applied to repayment of principal of the BankBoston Debt
until such Debt is paid in full, and then to repayment of
principal of the Loans any other obligations due the Facility
Lenders, and, in the case of the Henschels, to be applied to
repayment of the Henschel Note Obligations.
(p) The Company shall immediately repay the amount outstanding
under
<PAGE>
the Existing Loan Documents by the amount equal to the Net Proceeds of Sale of
Securitization Receivables in respect of any Pledged MBS and the net proceeds of
any sale of Mortgage Loans comprising a portion of the Collateral, in each case
which are sold or otherwise disposed of by the Company or any Subsidiary. The
Company shall not sell or otherwise dispose of any Pledged MBS or any such
Mortgage Loan without the Existing Lender's and, in the case of any Pledged MBS,
each other Creditor's consent, such consent not to be unreasonably withheld or
delayed by the Existing Lender, such other Creditors or the Company (it being
understood and agreed that the delivery by the Existing Lender of a release of
its lien in respect of a Mortgage Loan being sold shall constitute conclusive
evidence of such consent). The parties agree that it would be reasonable for the
Existing Lender and each other Creditor to withhold its consent to any such sale
if, in its sole discretion, the Existing Lender or, in the case of any sale of
any Pledged MBS, such other Creditor concludes that (i) such sale will impair
its ability to be paid the Existing Obligations or the obligations due such
other Creditor, (ii) such sale will adversely affect the Available Cash Flow
from Securitization Receivables or Available Cash Flow from Other Creditor
Residuals, as the case may be, (iii) the selling price for the Pledged MBS or
any such Mortgage Loan should be higher or (iv) the Pledged MBS or any such
Mortgage Loan has not been adequately marketed.
(q) In the event the Company shall fail to pay when due any
amount due to the Existing Lender under this Agreement, the Existing Lender may
set off such amount against Available Cash Flow from Securitization Receivables
or payments on Pledged Loans otherwise payable to the Company hereunder.
Section 6. Conditions Precedent. The effectiveness of this
Agreement shall be subject to the condition that each of the other existing
lenders listed on Schedule I (the "Other Existing Lenders") shall have entered
into an Other Intercreditor Agreement in the form annexed hereto, and the
Company, the Facility Lenders and the Henschels shall have entered into the
Henschel Intercreditor Agreement and the Company, the Creditors and the
applicable escrow agents shall have entered into the Tax Escrow Agreement, the
NLC Escrow Agreement and the Securitization Escrow Agreement. The Company shall
furnish the Existing Lender complete and correct copies of each such Other
Intercreditor Agreement and the Henschel Intercreditor Agreement within one
business day of its execution.
Section 7. Certain Definitions.
"Advance" means any advance made by the Existing Lender under
the Existing Loan Agreement.
<PAGE>
"Allocable Share" means, with respect to the Monthly Cash Flow
Shortfall Amount, the percentage obtained by dividing (i) Available Cash Flow
from Securitization Receivables for such month by (ii) the sum of Available Cash
Flow from Securitization Receivables and Available Cash Flow from Other Creditor
Residuals for such month and, with respect to any Monthly Free Cash Flow Amount,
means the percentage determined by dividing (i) the aggregate amount of Residual
Debt then outstanding owing to the Existing Lender by (ii) the aggregate amount
of Residual Debt then outstanding owing to the Existing Lender or any Other
Residual Lender.
"Asset Sale" has the meaning specified in the recitals.
"Available Cash Flow from Other Creditor Residuals" means the
amount of any distribution with respect to, or repayment of, the Residuals
pledged or sold, subject to repurchase obligations, by the Company and its
Subsidiaries to any Other Existing Lender and accepted by such Lender in
connection with the financing of such Residuals.
"Available Cash Flow from Securitization Receivables" means
the amount of any distribution with respect to, or prepayment of, any Pledged
MBS.
"Available Post-Transaction Cash Flow" means the sum of (i)
the Available Cash Flow from Securitization Receivables, (ii) the Available Cash
Flow from Other Creditor Residuals, (iii) the Non-Residual Cash Proceeds, and
(iv) plus or minus the Operating Expense Differential, (v) minus the Operating
Expenses for the third succeeding month (except for any such month to which the
Initial Operating Expenses Amount relates) and (vi) minus for each of the months
of January and February, 2000, the cash interest payable to Creditors for that
month.
"BankBoston Debt" means the indebtedness of the Company owing
to the Facility Lenders in respect of the (i) Bridge Loan and Security
Agreement, dated as of October 10, 1997, as amended from time to time, by and
among the Company, certain of its Subsidiaries and BankBoston N.A., to which the
GSCP Funds have succeeded by assignment and (ii) a Loan and Security Agreement,
dated December 31, 1996, as amended from time to time, by and among the Company,
certain of its Subsidiaries and BankBoston N.A., to which the GSCP Funds have
succeeded by assignment.
"Business Plan" means a business plan of the Company and its
Subsidiaries prepared each month, which shall not provide for the conduct of any
<PAGE>
business except that permitted pursuant to Section 8(g) hereof, and showing on a
monthly basis (a) an estimate of all Operating Expenses for the succeeding
twelve month period, and (b) actual Operating Expenses for the prior three
months (or such shorter period commencing on the day of the closing of the Asset
Sale), which plan shall have been prepared by the Company and approved, in the
case of the Initial Business Plan and the Business Plan for each successive
twelve-month period succeeding that covered by the Initial Business Plan (each
such Business Plan so approved, a "Subsequent Approved Business Plan"), by GSCP
and two of the other Creditors, or, if there are at least one but fewer than
three other Creditors with outstanding Existing Obligations (as defined herein
or in their respective Other Intercreditor Agreements), by GSCP and at least one
such Other Creditor and, in the case of each other Business Plan, by GSCP, such
approval not to be unreasonably withheld or delayed.
"Change of Control" means the occurrence of any of the
following events (other than as a consequence of the issuance of the Preferred
Stock to the Facility Lenders upon exercise of the Exchange Option or the
closing of the Asset Sale):
(i) the Company consummates any sale, lease, exchange
or other disposition of all or substantially all of the assets
of the Company, in any transaction or series of transactions
not in the ordinary course of business and not contemplated by
a Business Plan; or
(ii) the Company engages in a merger, consolidation
or similar business combination with any third party.
"CMC Advance Proceeds" means any payments received by the
Company from CMC upon the closing of the Asset Sale in connection with CMC's
purchase from the Company of certain delinquent interest servicing advances
funded by and securing the Facility Lender Advances.
"Collateral" means (i) any Eligible Asset pledged by the
Borrower or its Subsidiaries and accepted by the Existing Lender in connection
with either an Advance or in response to a Margin Call; (ii) the contractual
right to receive payments, including the right to payments of principal and
interest and the right to enforce such payments, arising
<PAGE>
from or under any of the Eligible Assets; (iii) the contractual right to service
each Pledged Loan; (iv) any other right, interest or property of the Company or
any Subsidiary now or hereafter securing the performance by the Company or any
Subsidiary of the Existing Obligations; and (v) any and all proceeds, payments,
income, profits and products thereof, and all files and records relating
thereto.
"Common Stock" means the Company's common stock, par value
$0.001 per share.
"Company" means IMC Mortgage Company, a Florida corporation,
and any successor by merger and any entity purchasing all or substantially all
of the assets of the Company (other than pursuant to the Asset Purchase
Agreement).
"Creditor" means any of the Facility Lenders, the Existing
Lender or any Other Existing Lender.
"Delinquent Interest Advance Shortfall Amount" means the
amount of any obligations owing to the Facility Lenders in respect of the
Facility Lender Advances after giving effect to the payment by the Company to
the Facility Lenders of the CMC Advance Proceeds, which is estimated to be
approximately the amount set forth on Schedule III hereto corresponding to the
line entitled "Delinquent interest advance shortfall."
"Delinquent Mortgage Loan" means any Mortgage Loan which, as
of any date of determination, is more than 90 days delinquent in payment of any
principal or interest due thereunder.
"Designated Subsidiary" means National Lender Center until 366
days after the date on which any remaining advances made by the Company to
National Lending Center, Inc. shall have been repaid or written off and the net
proceeds thereof paid to the escrow agent under the NLC Escrow Agreement
pursuant to Section 5(h) hereof.
"Eligible Asset" means any Pledged MBS or Pledged Loan.
"Henschel Make-Up Amount" means the product of (i) 25% and
(ii) the excess if any of (A) $600,000 over (B) the amount the Henschels would
have received pursuant to Section 7(a) of the Henschels Intercreditor Agreement
if the Facility Lenders
<PAGE>
had no obligation to pay the Minimum Payment (as defined in Section 7(a) of the
Henschels Intercreditor Agreement).
"Initial Business Plan" means the initial Business Plan, a
copy of which is attached hereto as Schedule IV.
"Initial Operating Expenses Amount" means a good faith
estimate of the Company of Operating Expenses for the period commencing with the
day of the closing of the Asset Sale and ending on the last day of the third
full calendar month thereafter (except for cash interest payable to the
Creditors for the months of January and February, 2000).
"LIBOR" means the London interbank offered rate for one-month
U.S. Dollar deposits as it appears on page five of the Telerate screen at or
about 9:00 a.m. (New York City time).
"Margin Call" means the right of the Existing Lender to give
notice to require the Company to transfer to the Existing Lender cash or
additional Collateral.
"Monthly Free Cash Flow Amount" means, for any month, the
amount, if any, by which (i) the sum of (x) the Non-Residual Cash Proceeds, and
(y) any negative Operating Expense Differential exceeds (ii) the sum of (a) the
Operating Expenses for the third succeeding month (but only to the extent not
provided for in the Initial Operating Expenses Amount), (b) any positive
Operating Expense Differential, in each case, as set forth on the Monthly
Statement and (c) for each of the months of January and February, 2000, the cash
interest payable to the Creditors for that month.
"Monthly Cash Flow Shortfall Amount" means, for any month, the
amount, if any, by which (i) the sum of (a) the Operating Expenses projected by
the Company for the third succeeding month (but only to the extent not provided
for in the Initial Operating Expenses Amount), (b) any positive Operating
Expense Differential, and (c) for each of the months of January and February,
2000, the cash interest payable to the Creditors for that month exceeds (ii) the
sum of (x) the Non-Residual Cash Proceeds, and (y ) any negative Operating
Expense Differential, in each case, as set forth on the Monthly
<PAGE>
Statement.
"Monthly Statement" means a monthly cash flow statement and
projection prepared by the Company and approved in advance by GSCP or, if GSCP
declines to approve such statement, by two of the three other Creditors (and, if
the Operating Expenses (other than taxes, cash interest payable on any
obligations of the Company and any Mortgage Sale Shortfall) to be incurred in
any month are greater than the Operating Expenses (other than taxes, cash
interest payable on any obligations of the Company and any Mortgage Sale
Shortfall) for such month contained in the Initial Business Plan or any
Subsequently Approved Business Plan by more than (i) 10%, by two of the three
other Creditors, and (ii) 25%, by each Creditor), setting forth the following:
(i) the Available Cash Flow from Securitization Receivables received during the
prior month, (ii) the Available Cash Flow from Other Creditor Residuals received
during the prior month, (iii) the Non-Residual Cash Proceeds received by the
Company during the prior month, (iv) the amount of any Reserve Release during
the prior month, (v) the amount remaining on deposit under the Tax Escrow
Agreement, the NLC Escrow Agreement and the Securitization Escrow Agreement,
respectively, (vi) the estimated Operating Expenses to be incurred by the
Company and its Subsidiaries during the current month and the third succeeding
month, consistent with the Business Plan, (vii) the Operating Expense
Differential, (viii) any Mortgage Sale Excess Proceeds received or Mortgage Sale
Shortfall incurred, as the case may be, during the prior month, (ix) any Monthly
Cash Flow Shortfall Amount or Monthly Free Cash Flow Amount, as the case may be,
and, in the case of the Monthly Cash Flow Shortfall Amount, the Existing
Lender's and each Other Residual Lender's Allocable Share thereof, (x) the
Business Plan, and (xi) a capitalization table showing the indebtedness owing to
each creditor of the Company both as of the end of the prior month and after the
application of all amounts to be paid to such creditor pursuant to this Monthly
Statement and Section 5 hereof.
"Mortgage Loan" means any first-lien or second-lien
residential mortgage loan originated or serviced by the Company or its
Subsidiaries.
"Mortgage Sale Excess Proceeds" means (i) with respect to any
Sixty Day Mortgage Loan, the amount of any proceeds from the sale or other
disposition of such loan in excess of eighty percent (80%) of the principal
outstanding on such Sixty Day Mortgage Loan as of November 5, 1999, and (ii)
with respect to any Ninety Day Mortgage Loan, the amount of any proceeds from
the sale or other disposition of such loan in excess of sixty-eight and 60/100's
percent (68.6%) of the principal outstanding on such Ninety Day Mortgage Loan as
of November 5, 1999.
<PAGE>
"Mortgage Sale Shortfall" means (i) with respect to any Sixty
Day Mortgage Loan, the amount of any deficit of any proceeds from the sale or
other disposition of such loan relative to eighty percent (80%) of the principal
outstanding on such Sixty Day Mortgage Loan as of November 5, 1999, (ii) with
respect to any Ninety Day Mortgage Loan, the amount of any deficit of any
proceeds from the sale or other disposition of such loan relative to sixty-eight
and 60/100's percent (68.6%) of the principal outstanding on such Ninety Day
Mortgage Loan as of November 5, 1999 and (iii) with respect to any Mortgage Loan
(other than any Sixty Day Mortgage Loan or Ninety Day Mortgage Loan) sold or
otherwise disposed of after the closing of the Asset Sale and not included in
the proposed securitization of Mortgage Loans to which the Securitization Escrow
Agreement relates, any amount remaining outstanding on the applicable Creditor's
advances in respect of such Mortgage Loan after applying the net proceeds of the
sale of such Mortgage Loan (and after applying any amount distributed to the
applicable Creditor under the Securitization Escrow Agreement in respect of such
Mortgage Loan to repayment of the related advance) to repayment of the related
advance.
"Net Asset Sale Proceeds" means the cash proceeds received by
the Company upon the closing of the Asset Sale (including, without limitation,
the proceeds from the purchase by CMC of the servicing advances), net of any
Transaction Expenses and Professional Fees, and exclusive of the CMC Advance
Proceeds.
"Net Proceeds of Sale of Securitization Receivables" means the
proceeds, net of any reasonable out-of-pocket costs of sale or disposition,
realized by the Company or any Subsidiary from any sale, lease or other
disposition of any Pledged MBS.
"Ninety Day Mortgage Loans" means Mortgage Loans financed
(including by purchase subject to a repurchase obligation) by a Creditor which
are more than 90 days delinquent on November 5, 1999.
"NLC Amount" means the amount set forth on Schedule III hereto
corresponding to the line entitled "NLC 90-day warehouse financing", which
represents the amount required to be reserved for warehouse financing to be
provided by the Company to National Lending Center, Inc. for a period not to
exceed 90 days following
<PAGE>
the closing of the Asset Sale.
"NLC Escrow Agreement" means an escrow agreement among the
Company, each of the Creditors, and a bank acting as escrow agent, reasonably
acceptable to each Creditor, which agreement is satisfactory in form and
substance to each Creditor, providing for the deposit of the proceeds of the
warehouse financing to be provided by the Company to National Lending Center,
Inc. upon the closing of the transactions contemplated by the Asset Purchase
Agreement into escrow thereunder.
"Non-Residual Cash Proceeds" means any cash inflow to the
Company other than the Available Cash from Securitization Receivables, the
Available Cash from Other Creditor Residuals and the cash proceeds received upon
the closing of the Asset Sale, but only to the extent such cash proceeds are
applied or remain in reserve for application to the purpose for which such
proceeds were reserved as contemplated by Schedule III hereto.
"One-Time Working Capital Amount" means an amount representing
the Company's good faith estimate of the amount required to be reserved for the
payment of certain expenses and the run off of certain working capital items and
set forth on Schedule III hereto corresponding to the line entitled "One-time
working capital amount."
"Operating Expenses" means, for any period, the operating
expenses of the Company and its Subsidiaries incurred or to be incurred in
accordance with the current Monthly Statement or Initial Operating Expenses
Amount estimate, as the case may be, including, without limitation, any Mortgage
Sale Shortfall and any cash interest payable on any obligations of the Company.
"Operating Expense Differential" means, with respect to any
Monthly Statement, the difference (positive or negative) between the actual
Operating Expenses for the prior month and the estimated Operating Expenses for
such month reflected in the prior Monthly Statement (or, for the first such
statement, in the Initial Business Plan).
"Other Existing Lenders" has the meaning specified in Section
6.
"Other Intercreditor Agreements" means the separate
intercreditor agreements among the Company, an Other Existing Lender and the
Facility Lenders.
"Other Residual Lenders" means the Other Existing Lenders
which are
<PAGE>
owed Residual Debt.
"Person" means an individual, a corporation, a partnership, an
association, a trust or any other entity or organization, including a government
or political subdivision or an agency or instrumentality thereof.
"Pledged Loan" means any Mortgage Loan or Wet Mortgage Loan
that is pledged by the Company or its Subsidiaries and accepted by the Existing
Lender in connection with an Advance.
"Pledged MBS" means any residual, subordinated or interest
strip class of asset-backed security (i) issued in connection with a
securitization in which the Existing Lender or its designee acted as lead or
co-lead underwriter or placement agent and (ii) pledged by Company and its
Subsidiaries and accepted by the Existing Lender in connection with an Advance.
"Pro-Rata Share" means the fraction derived by dividing (A)
the Residual Debt owing to the Existing Lender by (B) the aggregate amount of
the Company's obligations in respect of Residual Debt, determined as of the date
of the closing of the Asset Sale.
"Reserve Release" means any release of funds to the Existing
Lender, the Other Existing Lenders, the Facility Lenders or the Henschels
pursuant to the Securitization Escrow Agreement, the Tax Escrow Agreement or the
NLC Escrow Agreement.
"Residual" means any residual, subordinated or interest strip
class of asset-backed security (i) issued in connection with a securitization in
which any Creditor or its designee acted as lead or co-lead underwriter or
placement agent and (ii) pledged or sold, subject to repurchase obligation, by
the Company and its Subsidiaries and accepted by such Creditor in connection
with the financing of such security.
"Residual Debt" the amount of any indebtedness of the Company
or any Subsidiary owing to the Existing Lender or any Other Existing Lender and
incurred in
<PAGE>
connection with the financing of any Residual.
"SafeCo Shortfall Amount" means the shortfall in the amount
received from CMC in connection with CMC's purchase of certain insurance
receivables of the Company in connection with the Asset Sale compared with the
corresponding insurance premium payables, an estimate of which is set forth on
Schedule III hereto corresponding to the line entitled "SafeCo shortfall."
"Securitization Escrow Agreement" means an escrow agreement
among the Company, each of the Creditors, and a bank acting as escrow agent,
reasonably acceptable to each Creditor, which agreement is satisfactory in form
and substance to each Creditor, providing for the deposit of the Securitization
Escrow Amount upon the closing of the transactions contemplated by the Asset
Purchase Agreement into escrow thereunder.
"Securitization Escrow Amount" means the amount set forth on
Schedule III hereto corresponding to the line entitled "Securitization Escrow
Amount."
"Seller's Guide" means the "IMC Mortgage Company Client
Operations Manual", together with the underwriting guidelines of the Company and
its Subsidiaries, a true and correct copy of which was previously provided to
the Existing Lender by the Company and its Subsidiaries.
"Sixty Day Mortgage Loans" means Mortgage Loans financed
(including by purchase subject to a repurchase obligation) by a Creditor which
are more than 60 days but not more than 90 days delinquent on November 5, 1999.
"Sold Mortgage Loan" means any Mortgage Loan (other than any
Sixty Day Mortgage Loan or Ninety Day Mortgage Loan), sold or otherwise disposed
of by the Company prior to the closing of the Asset Sale.
"Standstill Period" means a period ending on the first to
occur of (i) the repayment in full of all Existing Obligations, all obligations
owed to the Facility Lenders and the Henschel Note Obligations, (ii) termination
of the Standstill Period in accordance with Section 1(b) or 1(c) hereof, ( iii)
termination of the Asset Purchase Agreement or (iv) December 3, 1999, if the
closing of the Asset Sale shall not have occurred by such date.
<PAGE>
"Subsidiary" means, with respect to any Person, any
corporation or other entity of which securities or other ownership interests
having ordinary voting power to elect a majority of the board of directors or
other persons performing similar functions are at the time directly or
indirectly owned by such Person.
"Tax Escrow Agreement" means an escrow agreement among the
Company, each of the Creditors, and a bank acting as escrow agent, reasonably
acceptable to each Creditor, which agreement is satisfactory in form and
substance to each Creditor, providing for the deposit of the Tax Escrow Amount
upon the closing of the transactions contemplated by the Asset Purchase
Agreement into escrow thereunder.
"Tax Escrow Amount" means the amount set forth on Schedule III
hereto corresponding to the line entitled "Tax Escrow Amount", which, together
with the NLC Amount, represents the Company's good faith estimate of the amount
required to be reserved for the payment of tax liabilities of the Company
associated with Federal and state income taxes payable with respect to the year
ended December 31, 1999.
"Transaction Expenses and Professional Fees" means any unpaid
transaction expenses or professional fees payable in connection with the Asset
Sale, the preparation or negotiation of the various intercreditor agreements,
the documentation relating to the Facility Lender Advances and any prior monthly
servicing advances, the Acquisition Agreement, the Asset Purchase Agreement, any
transactions contemplated by or related to such agreements or transactions or
otherwise, an estimate of which is set forth in Schedule III hereto,
corresponding to the line entitled "Transaction expenses and professional fees."
"Transaction Proceeds Amount" means the amount derived by
subtracting from the Net Asset Sale Proceeds (A) the Tax Escrow Amount, (B) the
Securitization Escrow Amount, (C) the One-Time Working Capital Amount, (D) the
Delinquent Interest Advance Shortfall Amount, (E) the SafeCo Shortfall Amount,
(F) the Initial Operating Expenses Amount, (G) the Warehouse Debt Shortfall and
(H) the NLC Amount.
"Warehouse Debt Shortfall" means the amount representing (i)
with respect to Sixty Day Mortgage Loans, the excess, if any, of the principal
outstanding on
<PAGE>
the applicable Creditor's advances in respect of such Sixty Day Mortgage Loans
on November 5, 1999 over 80% of the outstanding principal amount of such Sixty
Day Mortgage Loan; (ii) with respect to Ninety Day Mortgage Loans, the excess,
if any, of the principal outstanding on the applicable Creditor's advances in
respect of such Ninety Day Mortgage Loans on November 5, 1999 over 68.6% of the
outstanding principal amount of such Ninety Day Mortgage Loan and (iii) with
respect to Sold Mortgage Loans, any amount remaining outstanding on the
applicable Creditor's advances in respect of such Sold Mortgage Loan after
applying the net proceeds of the sale of such Sold Mortgage Loan to repayment of
the related advance.
"Wet Mortgage Loan" means any residential mortgage loan
originated by the Company and its Subsidiaries in accordance with the Seller's
Guide, with respect to which all of the related documents required to be
delivered in connection with any Advance have not been deposited with the
custodian on or prior to the related Advance Date.
Section 8. Notice of Advances under the Loan Agreement; etc.
(a) The Company shall give each Creditor prompt written notice of any event
which upon notice or lapse of time or both would constitute an event of default
in respect of any of its outstanding Debt.
(b) The Company shall give the Existing Lender and the
Facility Lenders prompt written notice of any event that would permit
termination of the Standstill Period pursuant to Section 1(b) hereof.
(c) The Company shall give the Existing Lender prompt written
notice of the entering into any amendment to the Asset Purchase Agreement and
the closing of the Asset Sale.
(d) Notwithstanding the provisions of the Existing Loan
Agreement, during the Standstill Period, the Company shall pay interest on the
principal amount outstanding under the Existing Loan Agreement to the Existing
Lender weekly on Friday of each week or, if Friday is not a Business Day, on the
next Business Day and from and after the closing of the Asset Sale, the interest
rate applicable to the Existing Obligations shall be equal to LIBOR plus 300
basis points.
(e) The Company shall not repay any principal outstanding
under the Loan Agreement during the Standstill Period, except pursuant to
Section 5 hereof.
<PAGE>
(f) In the event all remaining Mortgage Loans securing (or
purchased subject to a repurchase obligation comprising) any Existing
Obligations have not been sold by the Company on or before the date which is 180
days following the closing of the Asset Sale, the Existing Lender may buy such
Mortgage Loans at their then fair market value (as determined by independent
third-party bid) or arrange for the sale of such Mortgage Loans to third parties
at such fair market value, and the Company shall take such actions and execute
such customary agreements and instruments as may be necessary to effect such
sale and transfer good and marketable title to such Mortgage Loans to the
purchaser thereof.
(g) Until all of the Company's obligations under this
Agreement, the Other Intercreditor Agreements, the Existing Loan Documents and
the Loan Agreement have been satisfied in full, the Company shall not conduct
any business or engage in any activities other than (a) liquidating its assets
in an orderly fashion and performing its obligations under (i) the Asset
Purchase Agreement, (ii) this Agreement (including its obligations under the
Existing Loan Documents), (iii) the Other Intercreditor Agreements and the
Henschel Intercreditor Agreement and the agreements evidencing the indebtedness
owing to such other Creditors and the Henschels, (iv) the Tax Escrow Agreement,
the NLC Escrow Agreement and the Securitization Escrow Agreement, (v) any other
agreements existing on the date hereof and (v) satisfying its other obligations
and liabilities, (b) transacting any other lawful business under its certificate
of incorporation and by-laws that is incident, necessary and appropriate to
accomplish the foregoing, including defending any actions or proceedings. The
Company shall maintain not more than a commercially reasonable number of
employees necessary to conduct the foregoing activities. The Company shall not
incur any indebtedness for borrowed money other than liabilities incurred in the
ordinary course of its business (as such business is limited under the preceding
provision), and not grant any new liens (except as may be incidental to the
foregoing permitted activities).
Section 9. Acknowledgment of Obligations. The Company
acknowledges that its obligations under the Existing Loan Documents and the lien
on the Collateral securing the Existing Obligations remain in full force and
effect, and that the Company has no defenses, counterclaims or offsets to its
obligations under the Existing Loan
<PAGE>
Documents and that such liens are valid, perfected and enforceable. The Company
hereby waives the application of the automatic stay in any bankruptcy proceeding
in respect of the Existing Obligations and the obligations under the Loan
Documents and the Company and each Creditor consents to the modification of the
stay to permit the exercise by the Existing Lender or the Facility Lenders of
their rights in respect of the Collateral, provided that the foregoing shall not
be construed to modify the provisions of Sections 2(b) and 3 hereof. This
document shall not constitute a waiver, amendment or modification of the
Existing Loan Documents, the Existing Obligations or the Loan Documents except
as expressly referred to herein and shall not be construed as a waiver or
consent to any future action on the part of the Company that would require a
waiver or consent of the Existing Lender or the Facility Lenders, respectively,
except to the extent expressly provided herein. The Company and each Subsidiary
hereby releases the Existing Lender, its officers, directors and participants
from any and all claims in respect of the Existing Loan Documents and in respect
of actions taken or not taken in connection therewith on or prior to the date of
execution and delivery hereof, excluding, however, any obligation under any
agreement by such person for the payment of money, return of property or any
contractual obligations. Effective upon the closing of the Asset Sale and the
receipt by the Creditors of the payments to be received hereunder from the
proceeds of the Asset Sale, the Existing Lender hereby releases the executive
officers and the directors of the Company from any and all claims in respect of
the Existing Loan Documents and in respect of the actions taken or not taken in
connection therewith on or prior to the date of execution and delivery hereof,
excluding, however, any obligations under any agreement by such person for the
payment of money, return of property or any contractual obligations, and also
excluding any claims in respect of fraud or intentional misconduct.
Section 10. Amendments, Etc. No amendment, modification,
supplement, termination, consent or waiver of this Agreement or any term or
provision of this Agreement shall be effective and binding unless in writing and
signed by the Existing Lender, the Other Existing Lenders and the Facility
Lenders. Any such waiver will be effective only in the specific instance and for
the specific purpose for which it is given.
Section 11. Severability. Any provision of this Agreement
which is illegal, invalid, prohibited or unenforceable in any jurisdiction
shall, as to such jurisdiction, be ineffective to the extent of such illegality,
invalidity, prohibition or unenforceability without invalidating or impairing
the remaining provisions hereof or affecting the validity or enforceability of
such provision in any other jurisdiction.
<PAGE>
Section 12. WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO
HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL OR
EQUITABLE ACTION, SUIT OR PROCEEDING ARISING OUT OF OR RELATING TO THIS
AGREEMENT, OR ANY TRANSACTION CONTEMPLATED HEREBY OR THE RELATIONSHIP
ESTABLISHED HEREUNDER.
Section 13. GOVERNING LAW; VENUE AND JURISDICTION. THE
VALIDITY OF THIS AGREEMENT, THE CONSTRUCTION, INTERPRETATION AND ENFORCEMENT
HEREOF AND THE RIGHTS OF THE PARTIES HERETO SHALL BE DETERMINED UNDER, GOVERNED
BY, AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK
WITHOUT GIVING EFFECT TO CONFLICTS OF LAW PRINCIPLES THEREOF. EACH OF THE
PARTIES HERETO SUBMITS TO THE NON-EXCLUSIVE JURISDICTION OF, AND AGREES THAT ALL
ACTIONS OR PROCEEDINGS ARISING IN CONNECTION WITH THIS AGREEMENT MAY BE TRIED
AND LITIGATED IN, FEDERAL OR, IN THE ABSENCE OF FEDERAL SUBJECT MATTER
JURISDICTION, STATE COURTS LOCATED IN THE COUNTY OF NEW YORK, STATE OF NEW YORK
UNLESS SUCH ACTIONS OR PROCEEDINGS ARE REQUIRED TO BE BROUGHT IN ANOTHER COURT
TO OBTAIN SUBJECT MATTER JURISDICTION OVER THE MATTER IN CONTROVERSY. EACH OF
THE PARTIES WAIVES, TO THE FULLEST EXTENT PERMISSIBLE UNDER APPLICABLE LAW, ANY
RIGHT IT MAY HAVE TO ASSERT BY WAY OF MOTION, AS A DEFENSE OR OTHERWISE THE
DOCTRINE OF FORUM NON CONVENIENS OR TO OBJECT TO VENUE IN ANY PROCEEDING
BROUGHT IN ACCORDANCE WITH THE IMMEDIATELY PRECEDING SENTENCE. SERVICE OF
PROCESS, SUFFICIENT FOR PERSONAL JURISDICTION IN ANY ACTION AGAINST SUCH PARTY
MAY BE MADE BY REGISTERED OR CERTIFIED MAIL, RETURN RECEIPT REQUESTED, TO ITS
ADDRESS INDICATED IN SECTION 16.
Section 14. Expenses. In addition to the foregoing, the
Company will also reimburse the Existing Lender and the Facility Lenders
promptly for their reasonable out-of-pocket costs and expenses incurred by such
Persons or their respective employees, agents or advisors in connection with the
performance of their respective obligations and duties hereunder and, to the
extent the Existing Loan Documents so provide, under the Existing Loan
Documents, and for any reasonable fees and expenses of legal or other
professional advisors to the Existing Lender and the Facility Lenders engaged in
<PAGE>
connection with the preparation and negotiation of this Agreement and review and
negotiation of all related documents, including the Asset Purchase Agreement and
the Loan Agreement, and monitoring performance of all related documents. If such
costs and expenses are not paid by the Company within 30 days of submission, the
Existing Lender may pay such costs and expenses from Available Cash Flow from
Securitization Receivables and payments on Pledged Loans, in which event
appropriate adjustments shall be made to such Existing Lender's and each Other
Residual Lender's Allocable Share of Available Cash Flow from Securitization
Receivables as if such costs and expenses were paid by the Company as Operating
Expenses.
Section 15. Agreement May Constitute Financing Statement. The
Company and the Existing Lender consents to the filing of this Agreement or a
photocopy thereof as a financing statement under the UCC as in effect in any
jurisdiction in which the Facility Lenders may determine such filing to be
necessary or desirable.
Section 16. Notices. All notices, requests and other
communications to any party hereunder shall be in writing and shall be given
to such party by facsimile transmission or by hand delivery at the following
address or facsimile number, or such other address or facsimile number as such
party may hereafter specify for the purpose by notice to the other party and
each other Creditor. (a) if to the Facility Lenders, Greenwich Street Capital
Partners II, L.P., c/o Greenwich Street Capital Partners, Inc., 388 Greenwich
Street, New York, New York 10013, Attn.: Sanjay Patel; Tel: (212) 816-1149, Fax:
(212) 816-0166; with a copy to Debevoise & Plimpton, 875 Third Avenue, New York,
New York 10022, Attn.: Steven Ostner, Esq., Tel: (212) 909-6000, Fax: (212)
909-6836; (b) if to the Company, IMC Mortgage Company, 5901 E. Fowler Avenue,
Tampa, Florida 33617, Attn.: President, Tel: (813) 984-2507, Fax: (813)
984-2594; with a copy to Mitchell W. Legler, 300A Wharfside Way, Jacksonville,
Florida 32207, Tel: (904) 346-3200, Fax: (904) 346-3299; and (c) and if to the
Existing Lender: Paine Webber Real Estate Securities Inc., 1285 Avenue of the
Americas, New York, New York 10019, Attn.: George Mangiaracina, Tel: (212)
713-3734, Fax: (212) 265-3881; with a copy to Cadwalader, Wickersham & Taft, 100
Maiden Lane, New York, New York 10038, Attn.: Michael S. Gambro, Esq., Tel:
(212) 504-6825; Fax: (212) 504-6666; and if to any of the Other Existing
Lenders, to such person and at the address and facsimile number provided in
Schedule II hereto. Each such notice, request or other communication shall be
effective when sent by facsimile transmission to the facsimile
<PAGE>
number or when delivered by hand to the address specified in this Section 16 or
Schedule II hereto, provided that a facsimile transmission shall be deemed to
have been sent only so long as the transmitting machine has provided an
electronic confirmation of such transmission.
Section 17. Binding Effect; Third Party Beneficiaries. This
Agreement shall be binding upon and inure to the benefit of the parties hereto
and their successors and permitted assigns, including any successor of the
Company by merger or any entity which purchases all or substantially all of the
assets of the Company (other than pursuant to the Asset Sale), and to each of
the other Creditors, and, as to Section 3(d) hereto, CMC, each of which is an
intended third-party beneficiary hereof. Neither the Facility Lenders nor the
Existing Lender may sell, assign, participate or otherwise transfer or dispose
of all or any portion of the Loan or the Existing Obligations to any Person
unless such Person shall have assumed and agreed to be bound by the terms hereof
by written instrument in form reasonably satisfactory to the Company and each
other Creditor.
Section 18. Counterparts; Section Headings. This Agreement may
be executed in any number of counterparts, each of which is an original, but all
of which together constitute but one instrument. Except as otherwise indicated,
references herein to any "Section" means a "Section" of this Agreement, and
the section headings in this Agreement are for purposes of reference only and
shall not limit or define the meaning hereof.
IN WITNESS WHEREOF, the parties have caused this Agreement to
be duly executed as of the date first above written.
IMC MORTGAGE COMPANY
By: /s/
---------------------------------
Name:
Title:
PAINE WEBBER REAL ESTATE SECURITIES INC.
By: /s/
---------------------------------
Name:
Title:
GREENWICH STREET CAPITAL PARTNERS II, L.P.
GSCP OFFSHORE FUND, L.P.
GREENWICH FUND, L.P.
GREENWICH STREET EMPLOYEES FUND, L.P.
TRV EXECUTIVE FUND, L.P.
By: GREENWICH STREET INVESTMENTS
II, L.L.C., their General Partner
By: /s/
---------------------------------
Name:
Title: Managing Member
<PAGE>
This Intercreditor Agreement is hereby acknowledged and agreed to by:
IMC CORPORATION OF AMERICA
IMC CREDIT CARD, INC.
IMC MORTGAGE COMPANY CANADA, LTD.
AMERICAN HOME EQUITY CORPORATION
IMC INVESTMENT CORPORATION
IMC INVESTMENT LIMITED PARTNERSHIP
ACG FINANCIAL SERVICES (IMC), INC.
AMERICAN MORTGAGE REDUCTION, INC.
CENTRAL MONEY MORTGAGE CO. (IMC), INC.
COREWEST BANC
EQUITY MORTGAGE CO. (IMC), INC.
IMCC INTERNATIONAL, INC.
MORTGAGE AMERICA (IMC), INC.
NATIONAL LENDING CENTER, INC.
NATIONAL LENDING CENTER TILT, INC.
NATIONAL LENDING GROUP, INC.
RESIDENTIAL MORTGAGE CORPORATION (IMC), INC.
By: /s/
----------------------------------
Name:
Title:
GERMAN AMERICAN CAPITAL CORPORATION
By: /s/
----------------------------------
Name:
Title:
By: /s/
----------------------------------
Name:
Title:
<PAGE>
BEAR STEARNS HOME EQUITY TRUST
By: /s/
----------------------------------
Name:
Title:
BEAR STEARNS INTERNATIONAL LIMITED
By: /s/
----------------------------------
Name:
Title:
<PAGE>
Schedule I
to the
Paine Webber Intercreditor Agreement
Other Existing Lenders
1. Master Repurchase Agreement, dated as of March 29, 1996, as amended from time
to time, by and among Bear Stearns Home Equity Trust and the Company and certain
of the Company's Subsidiaries.
2. Master Repurchase Agreement, dated as of May 1, 1997 Between Bear, Stearns
International Limited and Industry Mortgage Company, L.P.
3. Institutional Account Agreement, dated October 23, 1996, between and among
Industry Mortgage Company, L.P. and Bear Stearns.
4. Loan and Security Agreement, dated March 17, 1998, by and among IMC Mortgage
Company, IMC Corporation of America, ACG Financial Services (IMC), Inc.,
American Mortgage Reduction, Inc., Central Money Mortgage Co. (IMC), Inc.,
Corewest Banc, Equity Mortgage Co., (IMC), Inc., Mortgage America (IMC), Inc.,
National Lending Center, Inc., National Lending Center TILT, Inc, and
Residential Mortgage Corporation (IMC), Inc., as borrowers, and German American
Capital Corporation, as lender.
5. Loan and Security Agreement, dated March 17, 1998, by and among IMC Mortgage
Company, IMC Corporation of America, ACG Financial Services (IMC), Inc.,
American Mortgage Reduction, Inc., Central Money Mortgage Co. (IMC), Inc.,
Corewest Banc, Equity Mortgage Co., (IMC), Inc., Mortgage America (IMC), Inc.,
National Lending Center, Inc., National Lending Center TILT, Inc, and
Residential Mortgage Corporation (IMC), Inc., as borrowers, and German American
Capital Corporation, as successor by assignment to Aspen Funding Corp., as
lender.
6. (i) Bridge Loan and Security Agreement, dated as of October 10, 1997, as
amended from time to time, by and among the Company, certain of its Subsidiaries
and BankBoston N.A., to which the Facility Lenders have succeeded by assignment,
and (ii) a Loan and Security Agreement, dated December 31, 1996, as amended from
time to time, by and among the Company, certain of its Subsidiaries and
BankBoston N.A., to which the Facility Lenders have succeeded by assignment.
<PAGE>
Notice Address for Other Existing Lenders
Bear, Stearns & Co., Inc.
if to Bear, Stearns: Bear Stearns & Co. Inc., 245 Park Avenue, New York, New
York 10167, Attn: Philip M. Cedar, Tel.: (212) 272-6768, Fax: (212) 272-4933 and
Paul Friedman, Tel.: (212) 272-3516, Fax: (212) 272-6550, with a copy to;
Cadwalader, Wickersham & Taft, 100 Maiden Lane, New York, New York 10038, Attn.
Barry J. Dichter, Esq., Tel.: (212) 504-6000, Fax: (212) 504-6666;
Deutsche Lenders
if to German American Corporation, to: German American Capital Corporation, 31
West 52nd Street, New York, New York 10019, Attn.: Vijay Radhakishun, Tel.:
(212) 469-8925, Fax: (212) 469-5923, with a copy to: Deutsche Bank A.G., as
agent, 31 West 52nd Street, New York, New York 10019, Attn.: Greg Amoroso, Tel.:
(212) 469-3987, Fax: (212) 469-5160, and Richard Uhlig, Tel.: (212) 469-7730,
Fax: (212) 469-5103; and in either case described in clause (i) or (ii) above;
with a copy to Cadwalader, Wickersham & Taft, 100 Maiden Lane, New York, New
York 10038, Attn.: Karen Gelernt, Esq., Tel: (212) 504-6000, Fax: (212) 504-6666
BankBoston Facility
if to the Facility Lenders, as successors in interest to BankBoston, to: the
address provided for notice to the Facility Lenders pursuant to Section 16 of
the foregoing Agreement
<PAGE>
Sources and Uses of Cash from Asset Sale
($ 000)
Sources:
Proceeds from Asset Sale $____
Reimbursement of corporate servicing advances $____
Less discount 10.45% $____
Reimbursement of delinquent interest advance
Less discount
Net reimbursement $____
Total net sources of cash $____
Uses:
Transaction expenses and professional fees:
Debevoise & Plimpton
DLJ
Kramer, Levin
Bear, Stearns
Bear, Stearns
DMG
Greenwich Capital
Commercial Credit
CoreWest settlement
Others (proxy solicitation,
accountants, etc.) $____
Total transaction expenses and professional fees
Tax Escrow Amount
NLC 90-day warehouse financing
Securitization Escrow Amount
SafeCo shortfall
Delinquent interest advance shortfall
Warehouse shortfall
One-time working capital amount:
Vacation pay
Interest expense on November 15, 1999
Litigation costs
Accounts payable and accrued expenses estimated at
November 15, 1999 (IMC parent)
Accounts payable and accrued expenses estimated at
November 15, 1999 (subsidiaries)
Miscellaneous/unknown/working capital $____
Total one-time working capital amount $____
Total uses of cash $____
Excess of sources over uses of cash $____
Exhibit 10.82
SECOND AMENDED AND RESTATED INTERCREDITOR AGREEMENT
(Deutsche Lenders)
SECOND AMENDED AND RESTATED INTERCREDITOR AGREEMENT, dated as of
November 10, 1999, between IMC MORTGAGE COMPANY, a Florida corporation (the
"Company"), GREENWICH STREET CAPITAL PARTNERS II, L.P., a Delaware limited
partnership, GREENWICH FUND, L.P., a Delaware limited partnership, GSCP
OFFSHORE FUND, L.P., a Cayman Islands exempted limited partnership, GREENWICH
STREET EMPLOYEES FUND, L.P., a Delaware limited partnership, and TRV EXECUTIVE
FUND, L.P., a Delaware limited partnership (each a "Facility Lender" and
collectively, the "Facility Lenders"), and GERMAN AMERICAN CAPITAL CORPORATION
(the "Existing Lender "). Capitalized terms used in this Agreement without
definition have the meanings given to them in the Loan Agreement (as hereinafter
defined) as such terms are defined in the Loan Agreement on the date hereof (or
as amended by any amendment thereto approved by the Existing Lender).
RECITALS
A. The Company has entered into a Loan Agreement, dated as of
October 12, 1998, amended by Amendment No. 1 thereto, dated as of February 11,
1999 (as the same may be further modified, supplemented or restated from time to
time, the "Loan Agreement"), between the Company, as borrower, and the Facility
Lenders, pursuant to which the Facility Lenders have extended to the Company
loans in the aggregate principal amount of $38,000,000 (the "Loans"), subject to
the terms and conditions set forth in the Loan Agreement, which Loans are
evidenced by the Notes and entitled to the benefit of certain guarantees and
security provided to the Facility Lenders or to GSCP, as collateral agent (the
"Collateral Agent") under certain of the other Loan Documents.
B. The Facility Lenders have made certain additional loans to the
Company pursuant to Note Purchase and Amendment Agreement No. 6, dated as of
October 18, 1999, in the original principal amount of $61,500,000 (the "Facility
Lender Advances") to fund certain monthly delinquent interest servicing advances
in respect of the Company's securitizations
C. Pursuant to (i) the Loan and Security Agreement, dated March 17,
1998, as amended from time to time, by and among the Company, IMC Corporation of
America, ACG Financial Services (IMC), Inc., American Mortgage Reduction, Inc.,
Central Money Mortgage Co. (IMC), Inc., Corewest Banc, Equity Mortgage Co.,
(IMC), Inc., Mortgage America (IMC), Inc., National Lending Center, Inc.,
National Lending Center TILT, Inc, and Residential Mortgage Corporation (IMC),
Inc., as borrowers, and the Existing Lender, as lender (the "GAC Agreement"),
and (ii) the Loan and Security Agreement, dated March 17, 1998, as amended from
time to time, by and among the Company, IMC Corporation of America, ACG
Financial Services (IMC), Inc., American Mortgage
<PAGE>
Reduction, Inc., Central Money Mortgage Co. (IMC), Inc., Corewest Banc, Equity
Mortgage Co., (IMC), Inc., Mortgage America (IMC), Inc., National Lending
Center, Inc., National Lending Center TILT, Inc, and Residential Mortgage
Corporation (IMC), Inc., as borrowers, and the Existing Lender, as successor, by
assignment from Aspen Funding Corp. as lender (the "Aspen Loan Agreement", and
collectively with the "GAC Agreement", the "Existing Loan Agreements"), and
other related agreements in favor of the Existing Lender (collectively with the
Existing Loan Agreements, the "Existing Loan Documents"), the Existing Lender
have agreed to provide on an uncommitted basis, collateralized interim financing
to the Company from time to time, to enable the Company to finance certain
mortgage loans and for other purposes provided therein; and the Company and
certain of its Subsidiaries have granted a security interest in the Collateral
(as hereinafter defined) in order to secure their respective obligations under
the Existing Loan Documents (the "Existing Obligations").
D. The Company entered into an Acquisition Agreement (the
"Acquisition Agreement"), dated as of February 19, 1999, by and among each of
the Facility Lenders and the Company, pursuant to which the Company would issue
and deliver to the Facility Lenders common stock, par value $0.001 per share, of
the Company representing approximately 93.5% of the Common Stock outstanding
after such issuance.
E. The Company has (i) terminated the Acquisition Agreement and
(ii) entered into an Asset Purchase Agreement, dated as of July 13, 1999, as
amended by Addendum No. 1 thereto, dated September 7, 1999 and a Delinquency and
Servicing Advance Purchase Agreement (collectively, the "Asset Purchase
Agreement"), between the Company and CitiFinancial Mortgage Company, a Delaware
corporation ("CMC"), pursuant to which CMC would acquire certain assets and
assume certain liabilities of the Company (the "Asset Sale").
F. The Company, the Facility Lenders and the Existing Lender have
previously entered into an Intercreditor Agreement, dated as of October 12,
1998, amended and restated by the Amended and Restated Intercreditor Agreement,
dated as of February 18, 1999 and amended further by Amendment No. 1 to Amended
and Restated Intercreditor Agreements, dated as of March 31, 1999, and letter
agreements dated as of July 15, 1999, August 11, 1999, September 14, 1999 and
October 15, 1999 (as so amended and restated, the "Original Intercreditor
Agreement"). In connection with the entry by the Company into the Asset Purchase
Agreement, the Facility Lenders, the Company and the Existing Lender have agreed
to enter into this agreement amending and restating the Original Intercreditor
Agreement (as so amended and restated, the "Agreement").
<PAGE>
G. The Company issued a Promissory Note, dated as of July 1, 1997,
in the amount of $12,975,864.30 (as amended and including any additional
Promissory Notes delivered pursuant to the Henschel Intercreditor Agreement
(defined below), the "NH Note") to Neal Henschel ("NH"), and a Promissory Note,
dated as of July 1, 1997, in the amount of $1,441,762.70 (as amended and
including any additional Promissory Notes delivered pursuant to the Henschel
Intercreditor Agreement, the "JH Note", and, together with the NH Note, the
"Notes") to Jeffrey M. Henschel ("JH", and together with NH, the "Henschels"),
pursuant to which the Company has certain unsecured payment obligations to the
Henschels (the "Henschel Note Obligations").
H. The Company, the Facility Lenders, NH and JH have entered into
an Intercreditor Agreement, dated as of the date hereof (the "Henschel
Intercreditor Agreement"), pursuant to which the Henschels have agreed not to
take certain actions specified therein and the Company has agreed to make
certain payments to amortize the Henschel Note Obligations as provided therein.
NOW THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Company, the Existing Lender
and the Facility Lenders agree to amend and restate the Original Intercreditor
Agreement to read in its entirety as follows:
Section 1. Standstill. (a) Each of the Facility Lenders and the
Existing Lender agrees, subject to the terms of this Agreement, that for the
Standstill Period, it shall not:
(i) file or join in the filing of any involuntary petition in
bankruptcy with respect to the Company or its Subsidiaries, or initiate
or participate in any similar proceedings for the benefit of creditors,
including any proceeding for the appointment of a trustee, receiver,
conservator or liquidator of the Company or its Subsidiaries or any
portion of its assets;
(ii) seek to collect or enforce by litigation or otherwise, any
payment obligations under the Existing Loan Documents or the Loan
Documents; provided that nothing in this Section 1 shall prohibit the
Facility Lenders from exercising their Exchange Option;
(iii) make any Margin Calls or other demands for payment in respect
of, or additional collateral to secure the Existing Obligations;
provided, however, that this clause shall not adversely affect the right
of the Existing Lender to take any actions to preserve, protect or
perfect its liens in the Collateral;
<PAGE>
(iv) declare a default or event of default under, or exercise or
enforce any right or remedy under, or accelerate the maturity of any
Existing Obligation or Loan under, any Existing Loan Document or Loan
Document; or
(v) seek to attach, sequester or otherwise proceed against any of
the Collateral, except as provided in Section 8(f) hereof.
(b) The Standstill Period may be terminated by the Existing Lender or
the Facility Lenders by written notice to the Company and each other Creditor
upon the occurrence of any of the following:
(i) a failure by the Company under the Existing Loan Agreement
to make to the Existing Lender any scheduled payment of interest, which
failure continues unremedied for two days;
(ii) any intentional fraud or misrepresentation by the
Company;
(iii) immediately in the event any Other Existing Lender takes
any of the actions described in Section 1(a) of its Other Intercreditor
Agreement or either of the Henschels takes any of the actions described
in Section 1(a) of the Henschel Intercreditor Agreement, or, in the case
of the Existing Lender, immediately in the event any Facility Lender
takes any of the actions described in Section 1(a) of this Agreement, or,
in the case of the Facility Lenders, immediately in the event the
Existing Lender takes any of the actions described in Section 1(a) of
this Agreement or either of the Henschels takes any of the actions
described in Section 1(a) of the Henschel Intercreditor Agreement, in
each case whether or not it shall have given notice of termination of the
Standstill Period;
(iv) a Change of Control or payment of the Take-Out Premium,
except to the extent payable in accordance with Section 5 hereof;
(v)an event shall occur and be continuing for a period of ten
Business Days which permits (x) any holder of indebtedness for borrowed
money of the Company or the Designated Subsidiary outstanding (other than
the Company or any Creditor or Residential Funding Corporation) to
accelerate the maturity of such indebtedness or (y) any holder of such
indebtedness or any holder of any guarantee or other obligation of the
Company or the Designated Subsidiary to exercise remedies with respect to
property of the Company or the Designated Subsidiary
<PAGE>
(other than the Company or Residential Funding Corporation solely with
respect to the Mortgage Loans held by it as collateral for its existing
loan), without such indebtedness being paid or the rights of such holder
to take such action being waived, stayed or subjected to a standstill or
other agreement of such holder to forbear from exercising remedies,
reasonably satisfactory to the Creditors;
(vi) the Company shall, at any time on or after the date of
the closing of the Asset Sale, repay all or any portion of the Loans,
except any such repayment of the Loans in accordance with Section 5
hereof;
(vii) the Company shall fail to make any payment required to
be made in accordance with Section 5 or 15 hereof;
(viii) the Company shall incur or pay any Operating Expenses
or incur or pay any obligations, except as expressly contemplated hereby
or by the Monthly Statement; and
(ix) the Company shall breach the covenant set forth in
Section 8(g) or Section 5(h) hereof.
(c) The Standstill Period shall terminate automatically without notice
or other action by any Creditor upon the occurrence of any of the following:
(i) the Company or any Designated Subsidiary shall consent to
the appointment of or taking possession by a receiver, assignee,
custodian, sequestrator, trustee or liquidator (or other similar
official) of itself or of a substantial part of its property; or the
Company or any Designated Subsidiary shall admit in writing (to any
creditor, governmental authority or judicial court or tribunal) its
inability to pay its debts generally as they come due or shall fail
generally to pay its debts as they become due, or shall make a general
assignment for the benefit of its creditors; or the Company or any
Designated Subsidiary shall file a voluntary petition in bankruptcy or a
voluntary petition or answer seeking liquidation, reorganization or
other relief with respect to itself or its debts under the Federal
bankruptcy laws, as now or hereafter constituted or any other applicable
Federal or State bankruptcy, insolvency or other similar law, or shall
consent to the entry of an order for relief in an involuntary case under
any such law; or the Company or any Designated Subsidiary shall file an
answer admitting the material allegations of a petition filed against
the Company or such Designated Subsidiary in any such proceeding, or
otherwise seek relief under the provisions of any existing or future
Federal or State bankruptcy, insolvency or other similar law providing
for the reorganization or
<PAGE>
winding-up of corporations, or providing for an arrangement, agreement,
composition, extension or adjustment with its creditors; or the Company
or any Designated Subsidiary shall take or publicly announce its
intention to take corporate action in furtherance of any of the
foregoing; or
(ii) an order, judgment or decree shall be entered in any
proceeding by any court of competent jurisdiction appointing, without
the consent of the Company, a receiver, trustee or liquidator of the
Company or any Designated Subsidiary or of any substantial part of their
respective property, or any substantial part of the property of the
Company or any Designated Subsidiary shall be sequestered, and any such
order, judgment or decree of appointment or sequestration shall remain
in force undismissed, unstayed or unvacated for a period of 30 days
after the date of entry thereof; or
(iii) an involuntary petition against the Company or any
Designated Subsidiary in a proceeding under the Federal bankruptcy laws
or other insolvency laws, as now or hereafter in effect, shall be filed
and shall not be withdrawn or dismissed within 30 days thereafter, or a
decree or order for relief in respect of the Company or any Designated
Subsidiary shall be entered by a court of competent jurisdiction in an
involuntary case under the Federal bankruptcy laws, as now or hereafter
constituted, or, under the provisions of any law providing for
reorganization or windingup of corporations which may apply to the
Company or any Designated Subsidiary, any court of competent
jurisdiction shall assume jurisdiction, custody or control of the
Company or any Designated Subsidiary or of any substantial part of their
respective property and such jurisdiction, custody or control shall
remain in force unrelinquished, unstayed or unterminated for a period of
30 days.
Section 2. Grant of Security Interest. (a) In order to secure full and
timely payment of the Obligations under the Loan Agreement, and to secure the
performance of all of the other obligations of the Company under the Loan
Documents, the Company and each Subsidiary hereby mortgages, pledges and assigns
and transfers to the Facility Lenders, and grants to the Facility Lenders, a
continuing perfected security interest in, and a lien in the Collateral. The
Facility Lenders agree to release their lien in respect of any Pledged Loan,
which is sold by the Company (i) to the Existing Lender for a purchase price not
less than the advance rate (or, in the case of any Sixty Day Mortgage Loans or
Ninety Day Mortgage Loans, at not less than 80% or 68.6% of the principal
outstanding on such Mortgage Loans, respectively) in respect of such Pledged
Loan, (ii)
<PAGE>
pursuant to Section 8(f) hereof, (iii) pursuant to a securitization of Mortgage
Loans, or (iv) in a sale to an unaffiliated third party.
(b) The Facility Lenders agree for the benefit of the Existing Lender
that during the continuance of the Standstill Period and thereafter until the
earlier of ( i) 91 days after the satisfaction of the Existing Obligations in
full, (ii) the exercise by the Existing Lender of any right to attach,
sequester, foreclose or otherwise exercise remedies with respect to the
Collateral, and (iii) 180 days after the expiration or earlier termination of
the Standstill Period, the Facility Lenders will not seek to attach, sequester,
foreclose, levy on or otherwise exercise remedies with respect to the
Collateral, provided that nothing in this Section 2(b) shall restrict the
Facility Lenders from commencing suit on its Notes or for payment of its Loan,
the BankBoston Debt, the Facility Lender Advances or enforcement (other than by
exercising remedies with respect to the Collateral) of any other obligation
owing to it under the Loan Documents or otherwise by the Company.
Section 3. Acknowledgment and Priorities. (a) The Existing Lender
hereby acknowledges and consents to the entrance by the Company into the Loan
Documents and the granting of the lien in the Collateral granted pursuant to
Section 2; provided, however, notwithstanding anything to the contrary contained
in the Loan Agreement, the Notes or any of the Loan Documents, the parties
hereto acknowledge and agree that any security interest in or other rights with
respect to any Collateral granted to secure the Existing Obligations under the
Existing Loan Agreements or otherwise has and shall have priority over any
security interest in such Collateral granted pursuant to this Agreement, the
Loan Agreement or the other Loan Documents irrespective of:
(i) the time, order or method of attachment or perfection of the
security interest created by this Agreement, the Loan Agreement or any
Loan Document;
(ii) the time or order of filing or recording of financing statements
or other documents filed or recorded to perfect security interests in any
Collateral;
(iii) anything contained in any filing or agreement to which the
Facility Lenders, the Company, or the Collateral Agent under the Security
Documents now or hereafter may be a party, and
(iv) the rules for determining priority under the U.C.C. or other laws
governing the relative priorities of secured creditors.
(b) The Existing Lender hereby agrees, and the Company acknowledges,
that, promptly following the expiration of 91 days after payment in full of all
the Existing
<PAGE>
Obligations hereunder, any Collateral, including any books and records
(including, without limitation, computer files, printouts and other computer
materials and records) relating to the Collateral, as well as all proceeds and
products of such Collateral, held by it shall be held for the benefit of the
Facility Lenders, provided that if such Collateral is then subject to the prior
lien of another creditor, the Existing Lender may hold it for the benefit of
such other creditor and the Facility Lenders as their interests may appear. If
the Existing Lender has elected not to hold such Collateral following payment in
full of the Existing Obligations, it shall promptly forward any Collateral,
including any books and records (including, without limitation, computer files,
printouts and other computer materials and records) relating to the Collateral,
as well as all proceeds and products of such Collateral, to the Collateral
Agent, provided that if such Collateral is then subject to the prior lien of
another creditor, the Existing Lender may forward such Collateral, proceeds and
products thereof to such other creditor or, in the event of a dispute, to such
party as a court of competent jurisdiction may direct.
(c) Nothing contained in this Agreement shall alter or impair the
Existing Lender's rights under the Existing Loan Documents from and after the
termination of the Standstill Period in accordance herewith or be interpreted to
mean that the Existing Lender has any obligation under the Existing Loan
Documents or otherwise to return any proceeds received on a sale or deemed sale
of any Pledged Securities or Pledged Loan to the Company or any Subsidiary,
except as expressly provided herein.
(d) Each of the parties hereto consents to the transactions
contemplated by the Asset Purchase Agreement.
Section 4. Reserved Rights. (a) Notwithstanding anything in this
Agreement to the contrary, the Company and the Facility Lenders agree that this
Agreement shall in no manner impair any right of the Existing Lender under the
Existing Loan Agreements to enforce any condition precedent to any obligation it
may have thereunder to make future Advances to the Company and its Subsidiaries,
nor shall this Agreement limit the right of the Existing Lender to make Margin
Calls in respect of the hedging transactions with respect to U.S. treasury
securities that the Company may have entered into with the Existing Lender
outside of the Existing Loan Documents. All rights and obligations of the
Existing Lender under the Existing Loan Documents to make Advances or not make
Advances shall not be affected by this Agreement.
(b) In addition and notwithstanding anything to the contrary contained
herein (but subject to Section 8(f) hereof), this Agreement shall not (i) apply
to any Advances made from and after the date hereof, or any other obligation of
the Company or any of its Subsidiaries to the Existing Lender or any of its
Affiliates incurred from and after the
<PAGE>
date hereof or (ii) limit the rights of the Existing Lender or any Affiliate
thereof (x) subject to Section 8(f) hereof, to purchase mortgage loans from the
Company or any of its Subsidiaries, (y) to receive principal and/or interest at
the applicable mortgage rate on mortgage loans purchased by such Existing Lender
or any such Affiliate from the Company or any of its Subsidiaries or (z) to sell
mortgage loans to the Company or any of its Subsidiaries.
Section 5. Amortization. During the Standstill Period, the following
provisions contained in this Section 5 shall apply:
(a) From and after the date this Agreement becomes effective and
prior to the date of the closing of the Asset Sale, within five days following
receipt by the Existing Lender each month of Available Cash Flow from
Securitization Receivables, the Existing Lender shall apply ninety percent (90%)
of such Available Cash Flow from Securitization Receivables to the repayment of
principal of the Existing Obligations under the Existing Loan Documents secured
by the Pledged Securities generating such Available Cash Flow from
Securitization Receivables and shall remit the balance of such Available Cash
Flow from Securitization Receivables to the Company.
(b) Upon the closing of the Asset Sale, the Company shall pay to
the Existing Lender the sum of (x) its Pro-Rata Share of the product of (A)
seventy percent (70%) and (B) the Transaction Proceeds Amount, plus (y) the
Warehouse Debt Shortfall with respect to the Existing Lender and minus (z) the
Henschel Make-up Amount, in each case to be applied to repayment of principal of
the Existing Obligations under the Existing Loan Documents.
(c) Upon the closing of the Asset Sale, the Company shall pay to
the Facility Lenders and the Henschels, as their interests may appear pursuant
to the Henschel Intercreditor Agreement, the sum of (x) the product of (A)
thirty percent (30%) and (B) the Transaction Proceeds Amount plus (y) the
product of (A) three and (B) the Henschel Make-up Amount, in the case of the
Facility Lenders, to be applied to repayment of principal of the BankBoston Debt
until such Debt is paid in full, and then to repayment of the Loans and any
other obligations due the Facility Lenders, and, in the case of the Henschels,
to be applied to repayment of the Henschel Note Obligations.
(d) Upon the closing of the Asset Sale, the Company shall pay to
the Facility Lenders the sum of the CMC Advance Proceeds and the Delinquent
Interest Advance Shortfall Amount, in each case to be applied to repayment of
all obligations owing in
<PAGE>
respect of any outstanding Facility Lender Advances.
(e) Upon the closing of the Asset Sale, the Company shall pay or
reimburse the Existing Lender and the Facility Lenders for any Transaction
Expenses and Professional Fees then due and owing.
(f) Upon the closing of the Asset Sale, the Company shall cause CMC
to pay the Tax Escrow Amount to the escrow agent under the Tax Escrow Agreement
for deposit thereunder and application in accordance with the terms thereof.
(g) Upon the closing of the Asset Sale, the Company shall cause CMC
to pay the Securitization Escrow Amount to the escrow agent under the
Securitization Escrow Agreement for deposit thereunder and application in
accordance with the terms thereof.
(h) Upon the closing of the Asset Sale, the Company shall cause CMC
to deposit a portion of the sale proceeds in an amount equal to the NLC Amount
in a separate bank account with a bank reasonably satisfactory to the Creditors,
solely for the benefit of the Creditors (and not for the benefit of the
Company), and not commingled with any funds of the Company, which shall be
applied from time to time solely for the purpose of making advances for
warehouse financing to National Lending Center, Inc., such warehouse financing
to mature not later than 90 days after the closing of the Asset Sale and to be
on terms and pursuant to documentation reasonably satisfactory to the Creditors,
which financing shall provide for all repayments in respect of such financing to
be paid directly for deposit to such account. Upon the date which is 90 days
after the closing of the Asset Sale and from time to time thereafter upon
receipt of the net proceeds of such warehouse financing, the amount on deposit
in such account shall, pursuant to irrevocable instructions given by the Company
at or before the closing of the Asset Sale, be immediately paid to the escrow
agent under the NLC Escrow Agreement for deposit and application thereunder.
(i) Upon the closing of the Asset Sale, the Company shall apply the
SafeCo Shortfall Amount to payment of the insurance premiums payable to SafeCo.
(j) Upon the closing of the Asset Sale, the Company shall pay to
the Existing Lender and the Facility Lenders any accrued and unpaid interest on
the Existing Obligations, the BankBoston Debt and the Loan Agreement to but not
including the date of such closing.
(k) Any Reserve Release shall be made by the relevant escrow agent
pursuant to the Securitization Escrow Agreement, the NLC Escrow
<PAGE>
Agreement or the Tax Escrow Agreement, as the case may be, to the Existing
Lender, the Other Existing Lenders, the Facility Lenders and the Henschels, as
their interests may appear pursuant to such escrow agreements.
(l) Promptly upon receipt by the Company of any Mortgage Sale
Excess Proceeds, the Company shall pay (x) to the Existing Lender an amount
equal to its Pro-Rata Share of the product of seventy percent (70%) and any
Mortgage Sale Excess Proceeds, to be applied to repayment of principal of the
Existing Obligations under the Existing Loan Documents, and (y) to the Facility
Lenders and the Henschels, as their interests may appear pursuant to the
Henschel Intercreditor Agreement, the product of thirty percent (30%) and any
Mortgage Sale Excess Proceeds, in the case of the Facility Lenders, to be
applied to repayment of principal of the BankBoston Debt until such Debt is paid
in full, and then to repayment of the Loans and any other obligations due the
Facility Lenders, and, in the case of the Henschels, to be applied to repayment
of the Henschel Note Obligations.
(m) Promptly upon the sale of any Mortgage Loan securing (or
purchased subject to a repurchase obligation comprising) any Existing
Obligations that gives rise to a Mortgage Sale Shortfall, the Company shall pay
the Existing Lender the amount of such Mortgage Sale Shortfall.
(n) Within five days following receipt by the Existing Lender of
Available Cash Flow from Securitization Receivables during the month in which
the closing of the Asset Sale occurs, the Existing Lender shall (a) apply ninety
percent (90%) of the Available Cash Flow from Securitization Receivables for
such month to the repayment of principal of the Existing Obligations under the
Existing Loan Documents and (b) remit the balance of such Available Cash Flow
from Securitization Receivables to the Facility Lenders for payment to the
Facility Lenders and the Henschels, as their interests may appear pursuant to
the Henschel Intercreditor Agreement, in the case of the Facility Lenders, for
application to the repayment of principal of the BankBoston Debt, until such
Debt is paid in full, and then to repayment of principal of the Loans and any
other obligations due the Facility Lenders, and, in the case of the Henschels,
to be applied to repayment of the Henschel Note Obligations.
(o) Not later than the 15th calendar day (or the next business day,
if the 15th is not a business day) after the end of each calendar month ending
on or after the closing of the Asset Sale, the Company shall prepare and deliver
to the Existing Lender a Monthly Statement and, following the receipt of such
Monthly Statement by the Existing Lender, the Available Post-Transaction Cash
Flow with respect to such month shall be distributed in each such month as
follows:
<PAGE>
(i) within five days following receipt by the Existing Lender of the
Monthly Statement for such month but not sooner than one business
day after receipt by the Existing Lender of the Available Cash Flow
from Securitization Receivables paid to the Existing Lender that
month, the Existing Lender or the Collateral Agent, if it shall
have received the Collateral pursuant to Section 3(b) hereof, shall
remit to the Company the Existing Lender's Allocable Share of the
Monthly Cash Flow Shortfall Amount, if any, from such Available
Cash Flow from Securitization Receivables, if any; provided , that
in the event there is a dispute (including any dispute arising from
the failure of the requisite Creditors to approve any Monthly
Statement) with respect to the calculation of the Monthly Cash Flow
Shortfall Amount, the Existing Lender shall remit to the Company
such portion of the Monthly Cash Flow Shortfall Amount as
calculated by the Company as is not in dispute and shall remit any
balance promptly upon resolution of such dispute (it being
understood and agreed that the Existing Lender's obligation under
this clause (i) for any month shall not exceed the Available Cash
Flow from Securitization Receivables actually received that month);
(ii) until such time as the Existing Obligations have been repaid in
full:
(A) the Existing Lender shall (a) apply ninety percent (90%) of the
Available Cash Flow from Securitization Receivables for such month
remaining after the payment, if any, of the Existing Lender's
Allocable Share of the Monthly Cash Flow Shortfall Amount pursuant
to subsection (i) above, to the repayment of principal of the
Existing Obligations under the Existing Loan Documents and (b)
remit the balance, if any, of such Available Cash Flow from
Securitization Receivables to the Facility Lenders for payment to
the Facility Lenders and the Henschels, as their interests may
appear pursuant to the Henschel Intercreditor Agreement, in the
case of the Facility Lenders, for application to the repayment of
principal of the BankBoston Debt, until such Debt is paid in full,
and then to repayment of principal of the Loans and any other
obligations due the Facility Lenders, and, in the case of the
Henschels, to be applied to repayment of the Henschel Note
Obligations; and
(B) the Company shall (a) remit to the Existing Lender for
application to the repayment of principal of the Existing
Obligations under the Existing Loan Documents the Existing Lender's
Allocable Share of an amount equal to 90%
<PAGE>
of the Monthly Free Cash Flow Amount, if any, and (b) remit an
amount equal to 10% of the Monthly Free Cash Flow Amount to the
Facility Lenders for payment to the Facility Lenders and the
Henschels, as their interests may appear pursuant to the Henschel
Intercreditor Agreement, in the case of the Facility Lenders, to be
applied to repayment of principal of the BankBoston Debt until such
Debt is paid in full, and then to repayment of principal of the
Loans and any other obligations due the Facility Lenders, and, in
the case of the Henschels, to be applied to repayment of the
Henschel Note Obligations.
(iii) after such time as the Existing Obligations shall have been repaid
in full and until all obligations due to the Facility Lenders and
the Henschels have been paid in full:
(A) the Existing Lender, or the Collateral Agent, if it shall have
received the Collateral pursuant to Section 3(b) hereof, shall
remit the Existing Lender's Allocable Share of the Monthly Cash
Flow Shortfall Amount to the Company as provided in subsection (i)
above and remit 100% of the Available Cash Flow from Securitization
Receivables remaining after the remittance, if any, in respect of
the Monthly Cash Flow Shortfall Amount pursuant to subsection (i)
above, to the Facility Lenders for payment to the Facility Lenders
and the Henschels, as their interests may appear pursuant to the
Henschel Intercreditor Agreement, in the case of the Facility
Lenders, to be applied to repayment of principal of the BankBoston
Debt until such Debt is paid in full, and then to repayment of
principal of the Loans and any other obligations due the Facility
Lenders, and, in the case of the Henschels, to be applied to
repayment of the Henschel Note Obligations, and
(B) the Company shall remit 100% of the Monthly Free Cash Flow
Amount, if any, to the Facility Lenders and the Henschels, as their
interests may appear pursuant to the Henschel Intercreditor
Agreement, in the case of the Facility Lenders, to be applied to
repayment of principal of the BankBoston Debt until such Debt is
paid in full, and then to repayment of principal of the Loans and
any other obligations due the Facility Lenders, and, in the case of
the Henschels, to be applied to repayment of the Henschel Note
Obligations.
(p) The Company shall immediately repay the amount outstanding
under the Existing Loan Documents by the amount equal to the Net Proceeds of
Sale of Securitization Receivables in respect of any Pledged Securities and the
net proceeds of any sale of Mortgage Loans comprising a portion of the
Collateral, in each case which are sold or otherwise disposed of by the Company
or any Subsidiary. The Company shall not
<PAGE>
sell or otherwise dispose of any Pledged Securities or any such Mortgage Loan
without the Existing Lender's and, in the case of any Pledged Securities, each
other Creditor's consent, such consent not to be unreasonably withheld or
delayed by the Existing Lender, such other Creditors or the Company (it being
understood and agreed that the delivery by the Existing Lender of a release of
its lien in respect of a Mortgage Loan being sold shall constitute conclusive
evidence of such consent). The parties agree that it would be reasonable for the
Existing Lender and each other Creditor to withhold its consent to any such sale
if, in its sole discretion, the Existing Lender or, in the case of any sale of
any Pledged Securities, such other Creditor concludes that (i) such sale will
impair its ability to be paid the Existing Obligations or the obligations due
such other Creditor, (ii) such sale will adversely affect the Available Cash
Flow from Securitization Receivables or Available Cash Flow from Other Creditor
Residuals, as the case may be, (iii) the selling price for the Pledged
Securities or any such Mortgage Loan should be higher or (iv) the Pledged
Securities or any such Mortgage Loan has not been adequately marketed.
(q) In the event the Company shall fail to pay when due any amount
due to the Existing Lender under this Agreement, the Existing Lender may set off
such amount against Available Cash Flow from Securitization Receivables or
payments on Pledged Loans otherwise payable to the Company hereunder.
Section 6. Conditions Precedent. The effectiveness of this
Agreement shall be subject to the condition that each of the other existing
lenders listed on Schedule I (the "Other Existing Lenders") shall have entered
into an Other Intercreditor Agreement in the form annexed hereto, and the
Company, the Facility Lenders and the Henschels shall have entered into the
Henschel Intercreditor Agreement and the Company, the Creditors and the
applicable escrow agents shall have entered into the Tax Escrow Agreement, the
NLC Escrow Agreement and the Securitization Escrow Agreement. The Company shall
furnish the Existing Lender complete and correct copies of each such Other
Intercreditor Agreement and the Henschel Intercreditor Agreement within one
business day of its execution.
Section 7. Certain Definitions.
"Additional Collateral" means cash or additional collateral
reasonably acceptable to the Existing Lender transferred to the Existing Lender
pursuant to the applicable Existing Loan Agreement.
"Advance" means any advance made or assumed by the Existing Lender
under the applicable Existing Loan Agreement.
<PAGE>
"Allocable Share" means, with respect to the Monthly Cash Flow
Shortfall Amount, the percentage obtained by dividing (i) Available Cash Flow
from Securitization Receivables for such month by (ii) the sum of Available Cash
Flow from Securitization Receivables and Available Cash Flow from Other Creditor
Residuals for such month and, with respect to any Monthly Free Cash Flow Amount,
means the percentage determined by dividing (i) the aggregate amount of Residual
Debt then outstanding owing to the Existing Lender by (ii) the aggregate amount
of Residual Debt then outstanding owing to the Existing Lender or any Other
Residual Lender.
"Assets" means the collective reference to Mortgage Loans, Lender
Mortgages and Pledged Securities.
"Asset Sale" has the meaning specified in the recitals.
"Available Cash Flow from Other Creditor Residuals" means the
amount of any distribution with respect to, or repayment of, the Residuals
pledged or sold, subject to repurchase obligations, by the Company and its
Subsidiaries to any Other Existing Lender and accepted by such Lender in
connection with the financing of such Residuals.
"Available Cash Flow from Securitization Receivables" means the
amount of any distribution with respect to, or prepayment of, any Pledged
Securities.
"Available Post-Transaction Cash Flow" means the sum of (i) the
Available Cash Flow from Securitization Receivables, (ii) the Available Cash
Flow from Other Creditor Residuals, (iii) the Non-Residual Cash Proceeds, and
(iv) plus or minus the Operating Expense Differential, (v) minus the Operating
Expenses for the third succeeding month (except for any such month to which the
Initial Operating Expenses Amount relates) and (vi) minus for each of the months
of January and February, 2000, the cash interest payable to Creditors for that
month.
"BankBoston Debt" means the indebtedness of the Company owing to
the Facility Lenders in respect of the (i) Bridge Loan and Security Agreement,
dated as of October 10, 1997, as amended from time to time, by and among the
Company, certain of its Subsidiaries and BankBoston N.A., to which the GSCP
Funds have succeeded by assignment and (ii) a Loan and Security Agreement, dated
December 31, 1996, as amended from time to time, by and among the Company,
certain of its Subsidiaries and BankBoston N.A., to which the GSCP Funds have
succeeded by assignment.
"Borrowers" means any of IMC Mortgage Company, IMC Corporation of
<PAGE>
America, ACG Financial Services (IMC), Inc., American Mortgage Reduction, Inc.,
Central Money Mortgage Co. (IMC), Inc., Corewest Banc, Equity Mortgage Co.
(IMC), Inc., American Home Equity Corporation, Mortgage America (IMC), Inc.,
National Lending Center, Inc., National Lending Center TILT, Inc., National
Lending Group, Inc. and any additional Persons that may become Borrowers under
either Existing Loan Agreement.
"Business Plan" means a business plan of the Company and its
Subsidiaries prepared each month, which shall not provide for the conduct of any
business except that permitted pursuant to Section 8(g) hereof, and showing on a
monthly basis (a) an estimate of all Operating Expenses for the succeeding
twelve month period, and (b) actual Operating Expenses for the prior three
months (or such shorter period commencing on the day of the closing of the Asset
Sale), which plan shall have been prepared by the Company and approved, in the
case of the Initial Business Plan and the Business Plan for each successive
twelve-month period succeeding that covered by the Initial Business Plan (each
such Business Plan so approved, a "Subsequent Approved Business Plan"), by GSCP
and two of the other Creditors, or, if there are at least one but fewer than
three other Creditors with outstanding Existing Obligations (as defined herein
or in their respective Other Intercreditor Agreements), by GSCP and at least one
such Other Creditor and, in the case of each other Business Plan, by GSCP, such
approval not to be unreasonably withheld or delayed.
"Cash Collateral Account" means a cash collateral account
established and maintained by the Existing Lender pursuant to the terms and
conditions of the Existing Loan Agreements.
"Change of Control" means the occurrence of any of the following
events (other than as a consequence of the issuance of the Preferred Stock to
the Facility Lenders upon exercise of the Exchange Option or the closing of the
Asset Sale):
(i) the Company consummates any sale, lease, exchange or other
disposition of all or substantially all of the assets of the
Company, in any transaction or series of transactions not in the
ordinary course of business and not contemplated by a Business
Plan; or
(ii) the Company engages in a merger, consolidation or similar
business combination with any third party.
<PAGE>
"CMC Advance Proceeds" means any payments received by the Company
from CMC upon the closing of the Asset Sale in connection with CMC's purchase
from the Company of certain delinquent interest servicing advances funded by and
securing the Facility Lender Advances.
"Collateral" means all of the Company's or any Borrower's right,
title and interest in, to and under each of the following items of property,
whether now owned or hereafter acquired, now existing or hereafter created and
wherever located:
all Assets;
all Collateral Documents, including without limitation all promissory
notes relating to or evidencing the Assets, and all Servicing Records, servicing
agreements and any other collateral pledged or otherwise relating to such
Collateral, together with all files, documents, instruments, surveys,
certificates, correspondence, appraisals, computer programs, computer storage
media, accounting records and other books and records relating thereto;
all securities, monies or property representing dividends or interest on
any of the foregoing, or representing a distribution in respect of the
foregoing, or resulting from a split-up, revision, reclassification or other
like change of the foregoing or otherwise received in exchange therefor, and any
subscription warrants, rights or options issued to the holders of, or otherwise
in respect of, the foregoing;
all Pooling and Servicing Agreements;
all Collection Accounts and amounts on deposit therein;
all Cash Collateral Accounts and amounts on deposit therein;
all guaranties and insurance (issued by governmental agencies or
otherwise including without limitation, FHA Mortgage Insurance) and any
insurance certificate or other document evidencing such guaranties or insurance
relating to any item of Collateral and all claims and payments thereunder;
all other insurance policies and insurance proceeds relating to any item
of Collateral;
all Interest Rate Protection Agreements;
all Additional Collateral provided to the Existing Lender;
<PAGE>
all of the Company's or any Borrower's rights, but not their obligations,
under any purchase agreements and servicing agreements and all servicing rights
covering or relating to any item of the Collateral to which the Company or any
of the Borrowers are a party;
all "general intangibles" as defined in the Uniform Commercial Code
relating to or constituting any and all of the items listed in the foregoing
items;
any other right, interest or property of the Company or any Subsidiary
now or hereafter securing the performance by the Company or any Subsidiary of
the Existing Obligations; and
any and all replacements, substitutions, distributions on or proceeds of
any and all of the foregoing.
"Collateral Documents" means, with respect to the items of
Collateral, the documents comprising the Collateral File for such Collateral.
"Collateral File" means, with respect to each Mortgage Loan, those
documents that are delivered to the Custodian or which at any time come into
the possession of the Custodian, pursuant to the terms and conditions of either
Custodial Agreement.
"Collection Account" means a collection account established and
maintained by the Existing Lender pursuant to the terms and conditions of the
Existing Loan Agreements.
"Common Stock" means the Company's common stock, par value $0.001
per share.
"Company" means IMC Mortgage Company, a Florida corporation, and
any successor by merger and any entity purchasing all or substantially all of
the assets of the Company (other than pursuant to the Asset Purchase Agreement).
"Creditor" means any of the Facility Lenders, the Existing Lender
or any Other Existing Lender.
"Custodial Agreements" means separate Custodial Agreements by among
the
<PAGE>
Company, certain of its Subsidiaries, Custodian and the Existing Lender, as the
same shall be modified and supplemented and in effect from time to time.
"Custodian" means BankBoston, N.A., as custodian under the
Custodial Agreements, and its successors and permitted assigns thereunder.
"Delinquent Interest Advance Shortfall Amount" means the amount of
any obligations owing to the Facility Lenders in respect of the Facility Lender
Advances after giving effect to the payment by the Company to the Facility
Lenders of the CMC Advance Proceeds, which is estimated to be approximately the
amount set forth on Schedule III hereto corresponding to the line entitled
"Delinquent interest advance shortfall."
"Delinquent Mortgage Loan" means any Mortgage Loan which, as of any
date of determination, is more than 90 days delinquent in payment of any
principal or interest due thereunder.
"Designated Subsidiary" means National Lender Center until 366 days
after the date on which any remaining advances made by the Company to National
Lending Center, Inc. shall have been repaid or written off and the net proceeds
thereof paid to the escrow agent under the NLC Escrow Agreement pursuant to
Section 5(h) hereof.
"FHA" means the Federal Housing Administration, an agency within
the United States Department of Housing and Urban Development, or any successor
thereto and including the Federal Housing Commissioner and the Secretary of
Housing and Urban Development where appropriate under the FHA Regulations.
"FHA Loan" means a Mortgage Loan which is the subject of FHA
Mortgage Insurance.
"FHA Mortgage Insurance" means mortgage insurance authorized under
the National Housing Act, as amended from time to time, and provided by the FHA.
"FHA Regulations" means regulations promulgated by HUD under the
National Housing Act, codified in 24 Code of Federal Regulations, and other HUD
issuances relating to FHA Loans, including the related handbooks, circulars,
notices and mortgagee letters.
"FNMA" means the Federal National Mortgage Association, or any
successor thereto.
<PAGE>
"Henschel Make-up Amount" means the product of (i) 25% and (ii) the
excess if any of (A) $600,000 over (B) the amount the Henschels would have
received pursuant to Section 7(a) of the Henschel Intercreditor Agreement if the
Facility Lenders had no obligation to pay the Minimum Payment (as defined in
Section 7(a) of the Henschel Intercreditor Agreement).
"HUD" means the Department of Housing and Urban Development, or any
federal agency or official thereof which may from time to time succeed to the
functions thereof with regard to FHA Mortgage Insurance, including subdivisions
thereof such as the FHA.
"Initial Business Plan" means the initial Business Plan, a copy of
which is attached hereto as Schedule IV.
"Initial Operating Expenses Amount" means a good faith estimate of
the Company of Operating Expenses for the period commencing with the day of the
closing of the Asset Sale and ending on the last day of the third full calendar
month thereafter (except for cash interest payable to the Creditors for the
months of January and February, 2000).
"Interest Rate Protection Agreement" means, with respect to any or
all of the Mortgage Loans, any short sale of a US Treasury Security, or futures
contract, or mortgage related security, or Eurodollar futures contract, or
options related contract, or interest rate swap, cap or collar agreement or
similar arrangements providing for protection against fluctuations in interest
rates or the exchange of nominal interest obligations, either generally or under
specific contingencies.
"Lender Mortgage" means, with respect to any REO Property owned or
to be owned by the Borrowers a duly executed and recorded mortgage, deed of
trust or similar instrument in favor of the Existing Lender on such REO
Property, which Lender Mortgage shall (A) name the Existing Lender as the
mortgagee thereon or the beneficiary thereof and (B) be on a FNMA uniform
instrument (or another form acceptable to the Existing Lender).
"LIBOR" means the London interbank offered rate for one-month U.S.
Dollar deposits as it appears on page five of the Telerate screen at or about
9:00 a.m. (New York City time).
<PAGE>
"Lien" means, as defined in the Uniform Commercial Code in effect
in any jurisdiction, with respect to the mortgages, liens, pledges, charges,
security interests or similar encumbrances created pursuant to the applicable
Existing Loan Agreement.
"Margin Call" means the right of the Existing Lender to give notice
to require the Company or any Subsidiary to transfer to the Existing Lender cash
or additional collateral.
"Monthly Free Cash Flow Amount" means, for any month, the amount,
if any, by which (i) the sum of (x) the Non-Residual Cash Proceeds, and (y) any
negative Operating Expense Differential exceeds (ii) the sum of (a) the
Operating Expenses for the third succeeding month (but only to the extent not
provided for in the Initial Operating Expenses Amount), (b) any positive
Operating Expense Differential, in each case, as set forth on the Monthly
Statement and (c) for each of the months of January and February, 2000, the cash
interest payable to the Creditors for that month.
"Monthly Cash Flow Shortfall Amount" means, for any month, the
amount, if any, by which (i) the sum of (a) the Operating Expenses projected by
the Company for the third succeeding month (but only to the extent not provided
for in the Initial Operating Expenses Amount), (b) any positive Operating
Expense Differential and (c) for each of the months of January and February,
2000, the cash interest payable to the Creditors for that month exceeds (ii) the
sum of (x) the Non-Residual Cash Proceeds, and (y ) any negative Operating
Expense Differential, in each case, as set forth on the Monthly Statement.
"Monthly Statement" means a monthly cash flow statement and
projection prepared by the Company and approved in advance by GSCP or, if GSCP
declines to approve such statement, by two of the three other Creditors (and, if
the Operating Expenses (other than taxes, cash interest payable on any
obligations of the Company and any Mortgage Sale Shortfall) to be incurred in
any month are greater than the Operating Expenses (other than taxes, cash
interest payable on any obligations of the Company and any Mortgage Sale
Shortfall) for such month contained in the Initial Business Plan or any
Subsequently Approved Business Plan by more than (i) 10%, by two of the three
other Creditors, and (ii) 25%, by each Creditor), setting forth the following:
(i) the Available Cash Flow from Securitization Receivables received during the
prior month, (ii) the Available Cash Flow from Other Creditor Residuals received
during the prior month, (iii) the Non-Residual Cash Proceeds received by the
Company during the prior month, (iv) the amount of any Reserve Release during
the prior month, (v) the amount remaining on deposit under the Tax Escrow
Agreement, the NLC Escrow Agreement and the Securitization Escrow Agreement,
respectively, (vi) the estimated Operating Expenses to
<PAGE>
be incurred by the Company and its Subsidiaries during the current month and the
third succeeding month, consistent with the Business Plan, (vii) the Operating
Expense Differential, (viii) any Mortgage Sale Excess Proceeds received or
Mortgage Sale Shortfall incurred, as the case may be, during the prior month,
(ix) any Monthly Cash Flow Shortfall Amount or Monthly Free Cash Flow Amount, as
the case may be, and, in the case of the Monthly Cash Flow Shortfall Amount, the
Existing Lender's and each Other Residual Lender's Allocable Share thereof, (x)
the Business Plan, and (xi) a capitalization table showing the indebtedness
owing to each creditor of the Company both as of the end of the prior month and
after the application of all amounts to be paid to such creditor pursuant to
this Monthly Statement and Section 5 hereof.
"Mortgage" means the mortgage, deed of trust or other instrument
securing a Mortgage Note, which creates a first lien on the fee in real property
securing the Mortgage Note.
"Mortgage Loan" means a mortgage loan which the Custodian has been
instructed to hold for the Existing Lender pursuant to a Custodial Agreement,
and which Mortgage Loan includes, without limitation, (i) a Mortgage Note and
related Mortgage and (ii) all of the Company's or any Borrowers' right, title
and interest in and to the Mortgaged Property covered by such Mortgage.
"Mortgage Note" means the original executed promissory note or
other evidence of the indebtedness of a mortgagor/borrower with respect to a
Mortgage Loan.
"Mortgage Sale Excess Proceeds" means (i) with respect to any Sixty
Day Mortgage Loan, the amount of any proceeds from the sale or other disposition
of such loan in excess of eighty percent (80%) of the principal outstanding on
such Sixty Day Mortgage Loan as of November 5, 1999, and (ii) with respect to
any Ninety Day Mortgage Loan, the amount of any proceeds from the sale or other
disposition of such loan in excess of sixty-eight and 60/100's percent (68.6%)
of the principal outstanding on such Ninety Day Mortgage Loan as of November 5,
1999.
"Mortgage Sale Shortfall" means (i) with respect to any Sixty Day
Mortgage Loan, the amount of any deficit of any proceeds from the sale or other
disposition of such loan relative to eighty percent (80%) of the principal
outstanding on such Sixty Day Mortgage Loan as of November 5, 1999, (ii) with
respect to any Ninety Day Mortgage Loan, the amount of any deficit of any
proceeds from the sale or other disposition of such loan relative to sixty-eight
and 60/100's percent (68.6%) of the principal outstanding on
<PAGE>
such Ninety Day Mortgage Loan as of November 5, 1999 and (iii) with respect to
any Mortgage Loan (other than any Sixty Day Mortgage Loan or Ninety Day Mortgage
Loan) sold or otherwise disposed of after the closing of the Asset Sale and not
included in the proposed securitization of Mortgage Loans to which the
Securitization Escrow Agreement relates, any amount remaining outstanding on the
applicable Creditor's advances in respect of such Mortgage Loan after applying
the net proceeds of the sale of such Mortgage Loan (and after applying any
amount distributed to the applicable Creditor under the Securitization Escrow
Agreement in respect of such Mortgage Loan to repayment of the related advance)
to repayment of the related advance.
"Mortgaged Property" means the real property (including all
improvements, buildings, fixtures, building equipment and personal property
thereon and all additions, alterations and replacements made at any time with
respect to the foregoing) and all other collateral securing repayment of the
debt evidenced by a Mortgage Note.
"Mortgagor" means the obligor on a Mortgage Note.
"Net Asset Sale Proceeds" means the cash proceeds received by the
Company upon the closing of the Asset Sale (including, without limitation, the
proceeds from the purchase by CMC of the servicing advances), net of any
Transaction Expenses and Professional Fees, and exclusive of the CMC Advance
Proceeds.
"Net Proceeds of Sale of Securitization Receivables" means the
proceeds, net of any reasonable out-of-pocket costs of sale or disposition,
realized by the Company or any Subsidiary from any sale, lease or other
disposition of any Pledged Securities.
"Ninety Day Mortgage Loans" means Mortgage Loans financed
(including by purchase subject to a repurchase obligation) by a Creditor which
are more than 90 days delinquent on November 5, 1999.
"NLC Amount" means the amount set forth on Schedule III hereto
corresponding to the line entitled "NLC 90-day warehouse financing", which
represents the amount required to be reserved for warehouse financing to be
provided by the Company to National Lending Center, Inc. for a period not to
exceed 90 days following the closing of the Asset Sale.
"NLC Escrow Agreement" means an escrow agreement among the Company,
each of the Creditors, and a bank acting as escrow agent, reasonably acceptable
to each Creditor, which agreement is satisfactory in form and substance to each
Creditor, providing for the deposit of the proceeds of the warehouse financing
to be provided by
<PAGE>
the Company to National Lending Center, Inc. upon the closing of the
transactions contemplated by the Asset Purchase Agreement into escrow
thereunder.
"Non-Residual Cash Proceeds " means any cash inflow to the Company
other than the Available Cash from Securitization Receivables, the Available
Cash from Other Creditor Residuals and the cash proceeds received upon the
closing of the Asset Sale, but only to the extent such cash proceeds are applied
or remain in reserve for application to the purpose for which such proceeds were
reserved as contemplated by Schedule III hereto.
"One-Time Working Capital Amount" means an amount representing the
Company's good faith estimate of the amount required to be reserved for the
payment of certain expenses and the run off of certain working capital items and
set forth on Schedule III hereto corresponding to the line entitled "One-time
working capital amount."
"Operating Expense Differential" means, with respect to any Monthly
Statement, the difference (positive or negative) between the actual Operating
Expenses for the prior month and the estimated Operating Expenses for such month
reflected in the prior Monthly Statement (or, for the first such statement, in
the Initial Business Plan).
"Operating Expenses" means, for any period, the operating expenses
of the Company and its Subsidiaries incurred or to be incurred in accordance
with the current Monthly Statement or Initial Operating Expenses Amount
estimate, as the case may be, including, without limitation, any Mortgage Sale
Shortfall and any cash interest payable on any obligations of the Company.
"Other Existing Lender" has the meaning specified in Section 6.
"Other Intercreditor Agreements" means the separate intercreditor
agreements among the Company, an Other Existing Lender and the Facility Lenders.
"Other Residual Lenders" means the Other Existing Lenders which are
owed Residual Debt.
"Person" means an individual, a corporation, a partnership, an
association, a trust or any other entity or organization, including a government
or political subdivision or an agency or instrumentality thereof.
<PAGE>
"Pledged Loan" means any Mortgage Loan or Wet Mortgage Loan that is
pledged by the Company or its Subsidiaries and accepted by the Existing Lender
in connection with an Advance.
"Pledged Securities" means the Subordinated Securities pledged to
the Existing Lender from time to time and held by the Existing Lender as
Collateral under the applicable Existing Loan Agreement.
"Pooling and Servicing Agreement" means any pooling and servicing
agreement, sale and servicing agreement, trust agreement or other agreement
pursuant to which the Mortgage Loans ultimately underlying any of the Pledged
Securities are serviced or administered or the Pledged Securities are issued or
exchanged.
"Pro-Rata Share" means the fraction derived by dividing (A) the
Residual Debt owing to the Existing Lender by (B) the aggregate amount of the
Company's obligations in respect of Residual Debt, determined as of the date of
the closing of the Asset Sale.
"REO Property" means a fee in real property acquired by the
Borrowers pursuant to or in connection with a purchase agreement, including a
Mortgaged Property acquired through foreclosure of a Mortgage Loan or by deed in
lieu of such foreclosure.
"Reserve Release" means any release of funds to the Existing
Lender, the Other Existing Lenders, the Facility Lenders or the Henschels
pursuant to the Securitization Escrow Agreement, the Tax Escrow Agreement or the
NLC Escrow Agreement.
"Residual" means any residual, subordinated or interest strip class
of asset-backed security (i) issued in connection with a securitization in which
any Creditor or its designee acted as lead or co-lead underwriter or placement
agent and (ii ) pledged or sold, subject to repurchase obligation, by the
Company and its Subsidiaries and accepted by such Creditor in connection with
the financing of such security.
"Residual Debt" the amount of any indebtedness of the Company or
any Subsidiary owing to the Existing Lender or any Other Existing Lender and
incurred in connection with the financing of any Residual.
"SafeCo Shortfall Amount" means the shortfall in the amount
received from CMC in connection with CMC's purchase of certain insurance
receivables of the Company in connection with the Asset Sale compared with the
corresponding insurance premium payables, an estimate of which is set forth on
Schedule III hereto corresponding
<PAGE>
to the line entitled "SafeCo shortfall."
"Securitization Escrow Agreement" means an escrow agreement among
the Company, each of the Creditors, and a bank acting as escrow agent,
reasonably acceptable to each Creditor, which agreement is satisfactory in form
and substance to each Creditor, providing for the deposit of the Securitization
Escrow Amount upon the closing of the transactions contemplated by the Asset
Purchase Agreement into escrow thereunder.
"Securitization Escrow Amount" means the amount set forth on
Schedule III hereto corresponding to the line entitled "Securitization Escrow
Amount."
"Securitization Transaction" means all underwritings or private
placements of (1) securities issued by or sponsored by and (2) backed by
Mortgage Loans or substantially similar assets acquired by or owned by
Borrowers or the Company (or any of their respective Affiliates), including
without limiting the generality of the foregoing, any of either entity's
securitization and other collateralized term financing transactions that involve
Mortgage Loans or substantially similar assets.
"Seller's Guide" means the "IMC Mortgage Company Client Operations
Manual", together with the underwriting guidelines of the Company and its
Subsidiaries, a true and correct copy of which was previously provided to the
Existing Lender by the Company and its Subsidiaries.
"Servicing Records" means any and all servicing agreements, files,
documents, records, data bases, computer tapes, copies of computer tapes, proof
of insurance coverage, insurance policies, appraisals, other closing
documentation, payment history records, and any other records relating to or
evidencing the servicing of Collateral.
"Sixty Day Mortgage Loans" means Mortgage Loans financed (including
by purchase subject to a repurchase obligation) by a Creditor which are more
than 60 days but not more than 90 days delinquent on November 5, 1999.
"Sold Mortgage Loan" means any Mortgage Loan (other than any Sixty
Day Mortgage Loan or Ninety Day Mortgage Loan), sold or otherwise disposed of by
the Company prior to the closing of the Asset Sale.
"Standstill Period" means a period ending on the first to occur of
(i) the repayment in full of all Existing Obligations, all obligations owed to
the Facility Lenders
<PAGE>
and the Henschel Note Obligations, (ii) termination of the Standstill Period in
accordance with Section 1(b) or 1(c) hereof, (iii) termination of the Asset
Purchase Agreement or (iv) December 3, 1999, if the closing of the Asset Sale
shall not have occurred by such date.
"Subordinated Securities" means interest-only strips, residual
interests, subordinated interests or reserve certificates issued and
transferred to the Company or Borrowers in connection with any Securitization
Transaction or any other collateral as the Existing Lender may deem appropriate.
"Subsidiary" means, with respect to any Person, any corporation or
other entity of which securities or other ownership interests having ordinary
voting power to elect a majority of the board of directors or other persons
performing similar functions are at the time directly or indirectly owned by
such Person.
"Tax Escrow Agreement" means an escrow agreement among the Company,
each of the Creditors, and a bank acting as escrow agent, reasonably acceptable
to each Creditor, which agreement is satisfactory in form and substance to each
Creditor, providing for the deposit of the Tax Escrow Amount upon the closing
of the transactions contemplated by the Asset Purchase Agreement into escrow
thereunder.
"Tax Escrow Amount" means the amount set forth on Schedule III
hereto corresponding to the line entitled "Tax Escrow Amount", which, together
with the NLC Amount, represents the Company's good faith estimate of the amount
required to be reserved for the payment of tax liabilities of the Company
associated with Federal and state income taxes payable with respect to the year
ended December 31, 1999.
"Transaction Expenses and Professional Fees" means any unpaid
transaction expenses or professional fees payable in connection with the Asset
Sale, the preparation or negotiation of the various intercreditor agreements,
the documentation relating to the Facility Lender Advances and any prior monthly
servicing advances, the Acquisition Agreement, the Asset Purchase Agreement, any
transactions contemplated by or related to such agreements or transactions or
otherwise, an estimate of which is set forth in Schedule III hereto,
corresponding to the line entitled "Transaction expenses and professional fees."
"Transaction Proceeds Amount " means the amount derived by
subtracting from the Net Asset Sale Proceeds (A) the Tax Escrow Amount, (B ) the
Securitization Escrow Amount, (C) the One-Time Working Capital Amount, (D ) the
Delinquent Interest Advance Shortfall Amount, (E) the SafeCo Shortfall Amount,
(F) the Initial Operating
<PAGE>
Expenses Amount, (G) the Warehouse Debt Shortfall and (H) the NLC Amount.
"Uniform Commercial Code" means the Uniform Commercial Code as in
effect on the date hereof in the State of New York.
"Warehouse Debt Shortfall" means the amount representing (i) with
respect to Sixty Day Mortgage Loans, the excess, if any, of the principal
outstanding on the applicable Creditor's advances in respect of such Sixty Day
Mortgage Loans on November 5, 1999 over 80% of the outstanding principal amount
of such Sixty Day Mortgage Loan; (ii) with respect to Ninety Day Mortgage Loans,
the excess, if any, of the principal outstanding on the applicable Creditor's
advances in respect of such Ninety Day Mortgage Loans on November 5, 1999 over
68.6% of the outstanding principal amount of such Ninety Day Mortgage Loan and
(iii) with respect to Sold Mortgage Loans, any amount remaining outstanding on
the applicable Creditor's advances in respect of such Sold Mortgage Loan after
applying the net proceeds of the sale of such Sold Mortgage Loan to repayment of
the related advance.
"Wet Mortgage Loan" means any residential mortgage loan originated
by the Company and its Subsidiaries in accordance with the Seller's Guide, with
respect to which all of the related documents required to be delivered in
connection with any Advance have not been deposited with the custodian on or
prior to the related Advance Date.
Section 8. Notice of Advances under the Loan Agreement; etc. (a)
The Company shall give each Creditor prompt written notice of any event which
upon notice or lapse of time or both would constitute an event of default in
respect of any of its outstanding Debt.
(b) The Company shall give the Existing Lender and the Facility
Lenders prompt written notice of any event that would permit termination of the
Standstill Period pursuant to Section 1(b) hereof.
(c) The Company shall give the Existing Lender prompt written
notice of the entering into any amendment to the Asset Purchase Agreement and
the closing of the Asset Sale.
(d) Notwithstanding the provisions of the Existing Loan Agreement,
during the Standstill Period, the Company shall pay interest on the principal
amount outstanding under the Existing Loan Agreement to the Existing Lender
weekly on Friday of each week or, if Friday is not a Business Day, on the next
Business Day and from and after the
<PAGE>
closing of the Asset Sale, the interest rate applicable to the Existing
Obligations shall be equal to LIBOR plus 300 basis points.
(e) The Company shall not repay any principal outstanding under the
Loan Agreement during the Standstill Period, except pursuant to Section 5
hereof.
(f) In the event all remaining Mortgage Loans securing (or
purchased subject to a repurchase obligation comprising) any Existing
Obligations have not been sold by the Company on or before the date which is 180
days following the closing of the Asset Sale, the Existing Lender may buy such
Mortgage Loans at their then fair market value (as determined by independent
third-party bid) or arrange for the sale of such Mortgage Loans to third parties
at such fair market value, and the Company shall take such actions and execute
such customary agreements and instruments as may be necessary to effect such
sale and transfer good and marketable title to such Mortgage Loans to the
purchaser thereof.
(g) Until all of the Company's obligations under this Agreement,
the Other Intercreditor Agreements, the Existing Loan Documents and the Loan
Agreement have been satisfied in full, the Company shall not conduct any
business or engage in any activities other than (a) liquidating its assets in
an orderly fashion and performing its obligations under (i) the Asset Purchase
Agreement, (ii) this Agreement (including its obligations under the Existing
Loan Documents), (iii) the Other Intercreditor Agreements and the Henschel
Intercreditor Agreement and the agreements evidencing the indebtedness owing to
such other Creditors and the Henschels, (iv) the Tax Escrow Agreement, the NLC
Escrow Agreement and the Securitization Escrow Agreement, (v) any other
agreements existing on the date hereof and (v) satisfying its other obligations
and liabilities, (b) transacting any other lawful business under its
certificate of incorporation and by-laws that is incident, necessary and
appropriate to accomplish the foregoing, including defending any actions or
proceedings. The Company shall maintain not more than a commercially reasonable
number of employees necessary to conduct the foregoing activities. The Company
shall not incur any indebtedness for borrowed money other than liabilities
incurred in the ordinary course of its business (as such business is limited
under the preceding provision), and not grant any new liens (except as may be
incidental to the foregoing permitted activities).
Section 9. Acknowledgment of Obligations. The Company acknowledges
that its obligations under the Existing Loan Documents and the lien on the
Collateral securing the Existing Obligations remain in full force and effect,
and that the Company has no
<PAGE>
defenses, counterclaims or offsets to its obligations under the Existing Loan
Documents and that such liens are valid, perfected and enforceable. The Company
hereby waives the application of the automatic stay in any bankruptcy proceeding
in respect of the Existing Obligations and the obligations under the Loan
Documents and the Company and each Creditor consents to the modification of the
stay to permit the exercise by the Existing Lender or the Facility Lenders of
their rights in respect of the Collateral, provided that the foregoing shall not
be construed to modify the provisions of Sections 2(b) and 3 hereof. This
document shall not constitute a waiver, amendment or modification of the
Existing Loan Documents, the Existing Obligations or the Loan Documents except
as expressly referred to herein and shall not be construed as a waiver or
consent to any future action on the part of the Company that would require a
waiver or consent of the Existing Lender or the Facility Lenders, respectively,
except to the extent expressly provided herein. The Company and each Subsidiary
hereby releases the Existing Lender, its officers, directors and participants
from any and all claims in respect of the Existing Loan Documents and in respect
of actions taken or not taken in connection therewith on or prior to the date of
execution and delivery hereof, excluding, however, any obligation under any
agreement by such person for the payment of money, return of property or any
contractual obligations. Effective upon the closing of the Asset Sale and the
receipt by the Creditors of the payments to be received hereunder from the
proceeds of the Asset Sale, the Existing Lender hereby releases the executive
officers and the directors of the Company from any and all claims in respect of
the Existing Loan Documents and in respect of the actions taken or not taken in
connection therewith on or prior to the date of execution and delivery hereof,
excluding, however, any obligations under any agreement by such person for the
payment of money, return of property or any contractual obligations, and also
excluding any claims in respect of fraud or intentional misconduct.
Section 10. Amendments, Etc. No amendment, modification,
supplement, termination, consent or waiver of this Agreement or any term or
provision of this Agreement shall be effective and binding unless in writing and
signed by the Existing Lender, the Other Existing Lender and the Facility
Lenders. Any such waiver will be effective only in the specific instance and for
the specific purpose for which it is given.
Section 11. Severability. Any provision of this Agreement which is
illegal, invalid, prohibited or unenforceable in any jurisdiction shall, as to
such jurisdiction, be ineffective to the extent of such illegality, invalidity,
prohibition or unenforceability without invalidating or impairing the
remaining provisions hereof or affecting the validity or enforceability of such
provision in any other jurisdiction.
Section 12. Letter Agreement. The Company and the Facility Lenders
agree that notwithstanding any of the provisions of this Agreement, this
Agreement does not
<PAGE>
supersede the provisions of the (i) the Letter Agreement regarding certain
issues in connection with the Existing Loan Agreements, dated as of October 12,
1998 by and between the Company and the Existing Lender and (ii) the Letter
Agreement re: DBS Underwriting Mandate, dated October 12, 1998, as amended,
between Deutsche Bank Securities and IMC Mortgage Company and each such Letter
Agreement shall remain in full force and effect in conformance with the terms
thereof.
Section 13. WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO HEREBY
IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL OR EQUITABLE
ACTION, SUIT OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT, OR ANY
TRANSACTION CONTEMPLATED HEREBY OR THE RELATIONSHIP ESTABLISHED HEREUNDER.
Section 14. GOVERNING LAW; VENUE AND JURISDICTION. THE VALIDITY
OF THIS AGREEMENT, THE CONSTRUCTION, INTERPRETATION AND ENFORCEMENT HEREOF AND
THE RIGHTS OF THE PARTIES HERETO SHALL BE DETERMINED UNDER, GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK WITHOUT
GIVING EFFECT TO CONFLICTS OF LAW PRINCIPLES THEREOF. EACH OF THE PARTIES HERETO
SUBMITS TO THE NON-EXCLUSIVE JURISDICTION OF, AND AGREES THAT ALL ACTIONS OR
PROCEEDINGS ARISING IN CONNECTION WITH THIS AGREEMENT MAY BE TRIED AND
LITIGATED IN, FEDERAL OR, IN THE ABSENCE OF FEDERAL SUBJECT MATTER
JURISDICTION, STATE COURTS LOCATED IN THE COUNTY OF NEW YORK, STATE OF NEW
YORK UNLESS SUCH ACTIONS OR PROCEEDINGS ARE REQUIRED TO BE BROUGHT IN ANOTHER
COURT TO OBTAIN SUBJECT MATTER JURISDICTION OVER THE MATTER IN CONTROVERSY.
EACH OF THE PARTIES WAIVES, TO THE FULLEST EXTENT PERMISSIBLE UNDER APPLICABLE
LAW, ANY RIGHT IT MAY HAVE TO ASSERT BY WAY OF MOTION, AS A DEFENSE OR OTHERWISE
THE DOCTRINE OF FORUM NON CONVENIENS OR TO OBJECT TO VENUE IN ANY PROCEEDING
BROUGHT IN ACCORDANCE WITH THE IMMEDIATELY PRECEDING SENTENCE. SERVICE OF
PROCESS, SUFFICIENT FOR PERSONAL JURISDICTION IN ANY ACTION AGAINST SUCH PARTY
MAY BE MADE BY REGISTERED OR CERTIFIED MAIL, RETURN RECEIPT REQUESTED, TO ITS
ADDRESS INDICATED IN SECTION 17.
<PAGE>
Section 15. Expenses. In addition to the foregoing, the Company
will also reimburse the Existing Lender and the Facility Lenders promptly for
their reasonable out-of-pocket costs and expenses incurred by such Persons or
their respective employees, agents or advisors in connection with the
performance of their respective obligations and duties hereunder and, to the
extent the Existing Loan Documents so provide, under the Existing Loan
Documents, and for any reasonable fees and expenses of legal or other
professional advisors to the Existing Lender and the Facility Lenders engaged in
connection with the preparation and negotiation of this Agreement and review
and negotiation of all related documents, including the Asset Purchase Agreement
and the Loan Agreement, and monitoring performance of all related documents. If
such costs and expenses are not paid by the Company within 30 days of
submission, the Existing Lender may pay such costs and expenses from Available
Cash Flow from Securitization Receivables and payments on Pledged Loans, in
which event appropriate adjustments shall be made to such Existing Lender's and
each Other Residual Lender's Allocable Share of Available Cash Flow from
Securitization Receivables as if such costs and expenses were paid by the
Company as Operating Expenses.
Section 16. Agreement May Constitute Financing Statement. The
Company and the Existing Lender consents to the filing of this Agreement or a
photocopy thereof as a financing statement under the UCC as in effect in any
jurisdiction in which the Facility Lenders may determine such filing to be
necessary or desirable.
Section 17. Notices. All notices, requests and other communications
to any party hereunder shall be in writing and shall be given to such party by
facsimile transmission or by hand delivery at the following address or
facsimile number, or such other address or facsimile number as such party may
hereafter specify for the purpose by notice to the other party and each other
Creditor: (a) if to the Facility Lenders, Greenwich Street Capital Partners II,
L.P., c/o Greenwich Street Capital Partners, Inc., 388 Greenwich Street, New
York, New York 10013, Attn.: Sanjay Patel; Tel: (212) 816-1149, Fax: (212)
816-0166; with a copy to Debevoise & Plimpton, 875 Third Avenue, New York, New
York 10022, attention: Steven Ostner, Esq., Tel: (212) 909-6000, Fax: (212)
909-6836; (b) if to the Company, IMC Mortgage Company, 5901 E. Fowler Avenue,
Tampa, Florida 33617, Attn.: President, Tel: (813) 984-2507, Fax: (813)
984-2594; with a copy to Mitchell W. Legler, 300A Wharfside Way, Jacksonville,
Florida 32207, Tel: (904) 346-3200, Fax: (904) 346-3299; and (c) and if to the
Existing Lender: German American Capital Corporation, 31 West 52nd Street, New
York, New York 10019, Attn.: Vijay Radhakishun, Tel.: (212) 469-8925, Fax: (212)
469-5923, with a copy to: Deutsche Bank A.G., as agent, 31 West 52nd Street, New
York, New York 10019, Attn.: Greg Amoroso, Tel.: (212) 469-3987, Fax: (212)
469-5160, and Richard Uhlig, Tel.: (212) 469-7730, Fax: (212) 469-5103; and in
either case described in clause
<PAGE>
(i) or (ii) above; with a copy to Cadwalader, Wickersham & Taft, 100 Maiden
Lane, New York, New York 10038, Attn.: Karen Gelernt, Esq., Tel: (212) 504-6000,
Fax: (212) 504-6666; and if to any of the Other Existing Lenders, to such person
and at the address and facsimile number provided in Schedule II hereto. Each
such notice, request or other communication shall be effective when sent by
facsimile transmission to the facsimile number or when delivered by hand to the
address specified in this Section 17 or Schedule II hereto, provided that a
facsimile transmission shall be deemed to have been sent only so long as the
transmitting machine has provided an electronic confirmation of such
transmission.
Section 18. Binding Effect; Third Party Beneficiaries. This
Agreement shall be binding upon and inure to the benefit of the parties hereto
and their successors and permitted assigns, including any successor of the
Company by merger or any entity which purchases all or substantially all of the
assets of the Company (other than pursuant to the Asset Sale), and to each of
the other Creditors, and, as to Section 3(d) hereto, CMC, each of which is an
intended third-party beneficiary hereof. Neither the Facility Lenders nor the
Existing Lender may sell, assign, participate or otherwise transfer or dispose
of all or any portion of the Loan or the Existing Obligations to any Person
unless such Person shall have assumed and agreed to be bound by the terms hereof
by written instrument in form reasonably satisfactory to the Company and each
other Creditor.
Section 19. Counterparts; Section Headings. This Agreement may be
executed in any number of counterparts, each of which is an original, but all of
which together constitute but one instrument. Except as otherwise indicated,
references herein to any "Section" means a "Section" of this Agreement, and
the section headings in this Agreement are for purposes of reference only and
shall not limit or define the meaning hereof.
<PAGE>
IN WITNESS WHEREOF, the parties have caused this Agreement to be
duly executed as of the date first above written.
IMC MORTGAGE COMPANY
By: /s/
---------------------------
Name:
Title:
GERMAN AMERICAN CAPITAL CORPORATION
By: /s/
---------------------------
Name:
Title:
By: /s/
---------------------------
Name:
Title:
<PAGE>
GREENWICH STREET CAPITAL PARTNERS II, L.P.
GSCP OFFSHORE FUND, L.P.
GREENWICH FUND, L.P.
GREENWICH STREET
EMPLOYEES FUND, L.P.
TRV EXECUTIVE FUND, L.P.
By: GREENWICH STREET
INVESTMENTS II, L.L.C.,
their General Partner
By: /s/
---------------------------
Name:
Title: Managing Member
<PAGE>
This Intercreditor Agreement is hereby acknowledged and agreed to by:
IMC CORPORATION OF AMERICA
IMC CREDIT CARD, INC.
IMC MORTGAGE COMPANY CANADA, LTD.
AMERICAN HOME EQUITY CORPORATION
IMC INVESTMENT CORPORATION
IMC INVESTMENT LIMITED PARTNERSHIP
ACG FINANCIAL SERVICES (IMC), INC.
AMERICAN MORTGAGE REDUCTION, INC.
CENTRAL MONEY MORTGAGE CO. (IMC), INC.
COREWEST BANC
EQUITY MORTGAGE CO. (IMC), INC.
IMCC INTERNATIONAL, INC.
MORTGAGE AMERICA (IMC), INC.
NATIONAL LENDING CENTER, INC.
NATIONAL LENDING CENTER TILT, INC.
NATIONAL LENDING GROUP, INC.
RESIDENTIAL MORTGAGE CORPORATION (IMC), INC.
By: /s/
-------------------------------
Name:
Title:
PAINE WEBBER REAL ESTATE SECURITIES INC.
By: /s/
-------------------------------
Name:
Title:
<PAGE>
BEAR STEARNS HOME EQUITY TRUST
By: /s/
-------------------------------
Name:
Title:
BEAR STEARNS INTERNATIONAL LIMITED
By: /s/
-------------------------------
Name:
Title:
<PAGE>
Schedule I
to the
Deutsche Lenders Intercreditor Agreement
Other Existing Lenders
1. Master Repurchase Agreement, dated as of March 29, 1996, as amended from
time to time, by and among Bear Stearns Home Equity Trust and the Company
and certain of the Company's Subsidiaries.
2. Master Repurchase Agreement, dated as of May 1, 1997 between Bear,
Stearns International Limited and Industry Mortgage Company, L.P.
3. Institutional Account Agreement, dated October 23, 1996, between and
among Industry Mortgage Company, L.P. and Bear Stearns.
4. Loan and Security Agreement, dated as of February 28, 1997, between IMC
Mortgage Company, IMC Corporation of America, ACG Financial Services
(IMC), Inc., American Mortgage Reduction, Inc., Industry Mortgage
Company, L.P., Corewest Banc, IMC Investment Corp., and IMC Investment
Limited Partnership, as borrowers, and Paine Webber Real Estate
Securities, Inc., as lender.
5. (i) Bridge Loan and Security Agreement, dated as of October 10, 1997, as
amended from time to time, by and among the Company, certain of its
Subsidiaries and BankBoston N.A., to which the Facility Lenders have
succeeded by assignment, and (ii) a Loan and Security Agreement, dated
December 31, 1996, as amended from time to time, by and among the
Company, certain of its Subsidiaries and BankBoston N.A., to which the
Facility Lenders have succeeded by assignment.
<PAGE>
Schedule II
to the
Deutsche Lenders Intercreditor Agreement
Notice Address for Other Existing Lender
Bear, Stearns & Co., Inc.
if to Bear, Stearns: Bear Stearns & Co. Inc., 245 Park Avenue, New York, New
York 10167, Attn: Philip M. Cedar, Tel.: (212) 272-6768, Fax: (212) 272-4933 and
Paul Friedman, Tel.: (212) 272-3516, Fax: (212) 272-6550, with a copy to;
Cadwalader, Wickersham & Taft, 100 Maiden Lane, New York, New York 10038, Attn.
Barry J. Dichter, Esq., Tel.: (212) 504-6000, Fax: (212) 504-6666;
Paine Webber
if to Paine Webber, to: Paine Webber Real Estate Securities Inc., 1285 Avenue of
the Americas, New York, New York 10019, Attn: George Mangiaracina, Tel: (212)
713-3734, Fax: (212) 265-3881; with a copy to Cadwalader, Wickersham & Taft, 100
Maiden Lane, New York, New York 10038, Attn: Michael S. Gambro, Esq., Tel: (212)
504-6825; Fax: (212) 504-6666.
BankBoston Facility
if to the Facility Lenders, as successors in interest to BankBoston, to: the
address provided for notice to the Facility Lenders pursuant to Section 17 of
the foregoing Agreement
<PAGE>
Sources and Uses of Cash from Asset Sale
($000)
Sources:
Proceeds from Asset Sale $____
Reimbursement of corporate servicing advances $____
Less Discount 10.45% $____
Reimbursement of delinquent interest advance
Less discount
Net reimbursement $____
Total net sources of cash $____
Uses:
Transaction expenses and professional fees:
Debevoise & Plimpton
DLJ
Kramer, Levin
Bear, Stearns
Bear, Stearns
DMG
Greenwich Capital
Commercial Credit
CoreWest settlement
Others (proxy solicitation, accountants, etc.)
Total transaction expenses and professional fees
Tax Escrow Amount
NLC 90-day warehouse financing
Securitization Escrow Amount
SafeCo shortfall
Delinquent interest advance shortfall
Warehouse shortfall
One-time working capital amount:
Vacation pay
Interest expense on November 15, 1999
Litigation costs
Accounts payable and accrued expenses estimated at
November 15, 1999 (IMC parent)
Accounts payable and accrued expenses estimated at
November 15, 1999 (subsidiaries)
Miscellaneous/unknown/working capital
Total one-time working capital amount $_____
Total uses of cash $_____
Excess of sources over uses of cash $_____
Exhibit 10.83
SECOND AMENDED AND RESTATED INTERCREDITOR AGREEMENT
(Bear Stearns)
SECOND AMENDED AND RESTATED INTERCREDITOR AGREEMENT, dated as
of November 10, 1999, between IMC MORTGAGE COMPANY, a Florida corporation (the
"Company"), GREENWICH STREET CAPITAL PARTNERS II, L.P., a Delaware limited
partnership ("GSCP"), GREENWICH FUND, L.P., a Delaware limited partnership, GSCP
OFFSHORE FUND, L.P., a Cayman Islands exempted limited partnership, GREENWICH
STREET EMPLOYEES FUND, L.P., a Delaware limited partnership, TRV EXECUTIVE FUND,
L.P., a Delaware limited partnership (each a "Facility Lender" and collectively,
the "Facility Lenders" or the "GSCP Funds"), and BEAR STEARNS HOME EQUITY TRUST
("BSTrust"), BEAR, STEARNS INTERNATIONAL LIMITED ("BSIL"), and any of their
affiliates which are or become party to the Institutional Account Agreement (as
hereinafter defined). BSTrust, BSIL and any such affiliates are referred to
herein collectively as "Bear Stearns". Capitalized terms used in this Agreement
without definition have the meanings given to them in the Loan Agreement (as
hereinafter defined) as such terms are defined in the Loan Agreement on the date
hereof (or as amended by any amendment thereto approved by Bear Stearns).
RECITALS
A. The Company has entered into a Loan Agreement, dated as of
October 12, 1998, amended by Amendment No. 1 thereto, dated as of February 11,
1999 (as the same may be further modified, supplemented or restated from time to
time, the "Loan Agreement"), between the Company, as borrower, and the Facility
Lenders, pursuant to which the Facility Lenders have extended to the Company
loans, in the aggregate principal amount of $38,000,000 (the "Loans"), subject
to the terms and conditions set forth in the Loan Agreement, which Loans are
evidenced by the Notes and entitled to the benefit of certain guarantees and
security provided to the Facility Lenders or to GSCP, as collateral agent (the
"Collateral Agent") under certain of the other Loan Documents.
B. The Facility Lenders have made certain additional loans to
the Company pursuant to Note Purchase and Amendment Agreement No. 6, dated as of
October 18, 1999, in the original principal amount of $61,500,000 (the "Facility
Lender Advances") to fund certain monthly delinquent interest servicing advances
in respect of the Company's securitizations.
<PAGE>
C. Pursuant to (a) a Master Repurchase Agreement, dated as of
March 29, 1996, as amended from time to time, by and among BSTrust, the Company
and certain of the Company's Subsidiaries (the "Whole Loan Repurchase
Agreement"), and other related agreements with BSTrust (collectively with the
Whole Loan Repurchase Agreement, the "Whole Loan Repurchase Documents"); (b) the
Master Repurchase Agreement, dated as of May 1, 1997, as amended from time to
time (together with annexes, confirmations and transactions thereunder,
collectively the "Residuals Repurchase Agreement") between BSIL and Industry
Mortgage Company, L.P., the predecessor to the Company ("IMCLP"); and (c) the
Institutional Account Agreement, dated October 23, 1996, as amended from to
time, between and among IMCLP and Bear Stearns (the "Institutional Account
Agreement"; and together with the Whole Loan Repurchase Agreement, the Whole
Loan Repurchase Documents and the Residuals Repurchase Agreement, collectively,
the "Existing Agreements"), BSTrust and BSIL have entered into transactions with
the Company from time to time, pursuant to which the Company has sold mortgage
loans to BSTrust and securities to BSIL, in each case subject to an obligation
to repurchase such assets and for other purposes provided therein; and the
Company and certain of its Subsidiaries have granted to BSTrust and BSIL a
security interest in the Collateral (as hereinafter defined) in order to secure
the respective obligations of the Company and the Subsidiaries under the
Existing Agreements (the "Existing Obligations").
D. The Company entered into an Acquisition Agreement (the
"Acquisition Agreement"), dated as of February 19, 1999, by and among each of
the GSCP Funds and the Company, pursuant to which the Company would issue and
deliver to the GSCP Funds common stock, par value $0.001 per share, of the
Company representing approximately 93.5% of the Common Stock outstanding after
such issuance.
E. The Company has (i) terminated the Acquisition Agreement
and (ii) entered into an Asset Purchase Agreement, dated as of July 13, 1999, as
amended by Addendum No. 1 thereto, dated September 7, 1999 and a Delinquency and
Servicing Advance Purchase Agreement (collectively, the "Asset Purchase
Agreement"), between the Company and CitiFinancial Mortgage Company, a Delaware
corporation ("CMC"), pursuant to which CMC would acquire certain assets and
assume certain liabilities of the Company
<PAGE>
(the "Asset Sale").
F. The Company, the Facility Lenders and Bear Stearns have
previously entered into an Intercreditor Agreement, dated as of October 12,
1998, amended and restated by the Amended and Restated Intercreditor Agreement,
dated as of February 18, 1999 and amended further by Amendment No. 1 to Amended
and Restated Intercreditor Agreements, dated as of March 31, 1999, and letter
agreements, dated as of July 15, 1999, August 11, 1999, September 14, 1999 and
October 15, 1999 (as so amended and restated, the "Original Intercreditor
Agreement"). In connection with the entry by the Company into and the
consummation of the Asset Purchase Agreement, the Facility Lenders, the Company,
and Bear Stearns have agreed to enter into this agreement amending and restating
the Original Intercreditor Agreement (as so amended and restated, the
"Agreement").
G. The Company issued a Promissory Note, dated as of July 1,
1997, in the amount of $12,975,864.30 (as amended and including any additional
Promissory Notes delivered pursuant to the Henschel Intercreditor Agreement
(defined below), the "NH Note") to Neal Henschel ("NH"), and a Promissory Note,
dated as of July 1, 1997, in the amount of $1,441,762.70 (as amended and
including any additional Promissory Notes delivered pursuant to the Henschel
Intercreditor Agreement, the "JH Note", and, together with the NH Note, the
"Notes") to Jeffrey M. Henschel ("JH", and together with NH, the "Henschels"),
pursuant to which the Company has certain unsecured payment obligations to the
Henschels (the "Henschel Note Obligations").
H. The Company, the Facility Lenders, NH and JH have entered
into an Intercreditor Agreement, dated as of the date hereof (the "Henschel
Intercreditor Agreement"), pursuant to which the Henschels have agreed not to
take certain actions specified therein and the Company has agreed to make
certain payments to amortize the Henschel Note Obligations as provided therein.
NOW THEREFORE, for good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the Company, Bear
Stearns and the Facility Lenders agree to amend and restate the Original
Intercreditor Agreement to read in its entirety as follows:
<PAGE>
Section 1. Standstill. (a) Each of the Facility Lenders and
Bear Stearns agrees, subject to the terms of this Agreement, that for the
Standstill Period, it shall not:
(i) file or join in the filing of any involuntary petition in
bankruptcy with respect to the Company or its Subsidiaries, or initiate
or participate in any similar proceedings for the benefit of creditors,
including any proceeding for the appointment of a trustee, receiver,
conservator or liquidator of the Company or its Subsidiaries or any
portion of its assets;
(ii) seek to collect or enforce by litigation or otherwise,
any repurchase or payment obligations under the Existing Agreements or
the Loan Documents; provided that nothing in this Section 1 shall
prohibit the Facility Lenders from exercising their Exchange Option;
(iii) make any Margin Calls or other demands for payment in
respect of, or additional collateral to secure, the Existing
Obligations; provided, however, that this clause shall not adversely
affect the right of Bear Stearns to take any actions to preserve,
protect or perfect its liens in the Collateral;
(iv) declare a default or event of default under, or exercise
or enforce any right or remedy under, or accelerate the maturity of any
Existing Obligation or Loan under, any Existing Agreement or Loan
Document; or
(v) seek to attach, sequester or otherwise proceed against any
of the Collateral, except as provided in Section 8(f) hereof.
(b) The Standstill Period may be terminated by Bear Stearns or
the Facility Lenders by written notice to the Company and each other Creditor
upon the occurrence of any of the following:
(i) a failure by the Company under the Existing
Agreements to make to Bear Stearns any scheduled payment of interest,
which failure continues unremedied for two days;
(ii) any intentional fraud or misrepresentation by
the Company;
<PAGE>
(iii) immediately in the event any Other Existing
Lender takes any of the actions described in Section 1(a) of its Other
Intercreditor Agreement or either of the Henschels takes any of the
actions described in Section 1(a) of the Henschel Intercreditor
Agreement, or, in the case of Bear Stearns, immediately in the event
any Facility Lender takes any of the actions described in Section 1(a)
of this Agreement, or, in the case of the Facility Lenders, immediately
in the event Bear Stearns takes any of the actions described in Section
1(a) of this Agreement or either of the Henschels takes any of the
actions described in Section 1(a) of the Henschel Intercreditor
Agreement, in each case whether or not it shall have given notice of
termination of the Standstill Period;
(iv) a Change of Control or payment of the Take-Out
Premium except to the extent payable in accordance with Section 5
hereof;
(v) an event shall occur and be continuing for a
period of ten Business Days which permits (x) any holder of
indebtedness for borrowed money of the Company or the Designated
Subsidiary outstanding (other than the Company or any Creditor or
Residential Funding Corporation) to accelerate the maturity of such
indebtedness or (y) any holder of such indebtedness or any holder of
any guarantee or other obligation of the Company or the Designated
Subsidiary to exercise remedies with respect to property of the Company
or the Designated Subsidiary (other than the Company or Residential
Funding Corporation solely with respect to the Mortgage Loans held by
it as collateral for its existing loan), without such indebtedness
being paid or the rights of such holder to take such action being
waived, stayed or subjected to a standstill or other agreement of such
holder to forbear from exercising remedies, reasonably satisfactory to
the Creditors;
(vi) the Company shall, at any time on or after the
date of the closing of the Asset Sale, repay all or any portion of the
Loans, except any such repayment of the Loans in accordance with
Section 5 hereof;
(vii) The Company shall fail to make any payment
required to be made in accordance with Section 5 or 14 hereof;
<PAGE>
(viii) The Company shall incur or pay any Operating
Expenses or incur or pay any obligations, except as expressly
contemplated hereby or by the Monthly Statement.
(ix) The Company shall breach the covenant set forth
in Section 8(g) or Section 5(h) hereof.
(c) The Standstill Period shall terminate automatically
without notice or other action by any Creditor upon the occurrence of any of the
following:
(i) the Company or any Designated Subsidiary shall
consent to the appointment of or taking possession by a receiver,
assignee, custodian, sequestrator, trustee or liquidator (or other
similar official) of itself or of a substantial part of its property;
or the Company or any Designated Subsidiary shall admit in writing (to
any creditor, governmental authority or judicial court or tribunal) its
inability to pay its debts generally as they come due or shall fail
generally to pay its debts as they become due, or shall make a general
assignment for the benefit of its creditors; or the Company or any
Designated Subsidiary shall file a voluntary petition in bankruptcy or
a voluntary petition or answer seeking liquidation, reorganization or
other relief with respect to itself or its debts under the Federal
bankruptcy laws, as now or hereafter constituted or any other
applicable Federal or State bankruptcy, insolvency or other similar
law, or shall consent to the entry of an order for relief in an
involuntary case under any such law; or the Company or any Designated
Subsidiary shall file an answer admitting the material allegations of
a petition filed against the Company or such Designated Subsidiary in
any such proceeding, or otherwise seek relief under the provisions of
any existing or future Federal or State bankruptcy, insolvency or other
similar law providing for the reorganization or winding-up of
corporations, or providing for an arrangement, agreement,
composition, extension or adjustment with its creditors; or the
Company or any Designated Subsidiary shall take or publicly announce
its intention to take corporate action in furtherance of any of the
foregoing; or
(ii) an order, judgment or decree shall be entered in
any proceeding by any court of competent jurisdiction appointing,
without the
<PAGE>
consent of the Company, a receiver, trustee or liquidator of the
Company or any Designated Subsidiary or of any substantial part of
their respective property, or any substantial part of the property of
the Company or any Designated Subsidiary shall be sequestered, and any
such order, judgment or decree of appointment or sequestration shall
remain in force undismissed, unstayed or unvacated for a period of 30
days after the date of entry thereof; or
(iii) an involuntary petition against the Company or
any Designated Subsidiary in a proceeding under the Federal bankruptcy
laws or other insolvency laws, as now or hereafter in effect, shall be
filed and shall not be withdrawn or dismissed within 30 days
thereafter, or a decree or order for relief in respect of the Company
or any Designated Subsidiary shall be entered by a court of competent
jurisdiction in an involuntary case under the Federal bankruptcy laws,
as now or hereafter constituted, or, under the provisions of any law
providing for reorganization or winding-up of corporations which may
apply to the Company or any Designated Subsidiary, any court of
competent jurisdiction shall assume jurisdiction, custody or control
of the Company or any Designated Subsidiary or of any substantial part
of their respective property and such jurisdiction, custody or
control shall remain in force unrelinquished, unstayed or
unterminated for a period of 30 days.
Section 2. Grant of Security Interest. (a) In order to secure
full and timely payment of the Obligations under the Loan Agreement, and to
secure the performance of all of the other obligations of the Company under the
Loan Documents, the Company and each Subsidiary hereby mortgages, pledges and
assigns and transfers to the Facility Lenders, and grants to the Facility
Lenders, a continuing perfected security interest in, and a lien in the
Collateral. The Facility Lenders agree to release their lien in respect of any
whole loan mortgage, which is sold by the Company (i) to Bear Stearns for a
purchase price not less than the advance rate (or, in the case of any Sixty Day
Mortgage Loans or Ninety Day Mortgage Loans, at not less than 80% or 68.6% of
the principal outstanding on such Mortgage Loans, respectively) in respect of
such mortgage, (ii) pursuant to Section 8(f) hereof, (iii) pursuant to a
securitization of Mortgage Loans or (iv) in a sale to an unaffiliated third
party.
<PAGE>
(b) The Facility Lenders agree for the benefit of Bear Stearns
that during the continuance of the Standstill Period and thereafter until the
earlier of (i) 91 days after the satisfaction of the Existing Obligations in
full, (ii) the exercise by Bear Stearns of any right to attach, sequester,
foreclose or otherwise exercise remedies with respect to the Collateral, and
(iii) 180 days after the expiration or earlier termination of the Standstill
Period, the Facility Lenders will not seek to attach, sequester, foreclose, levy
on or otherwise exercise remedies with respect to the Collateral, provided that
nothing in this Section 2(b) shall restrict the Facility Lenders from commencing
suit on its Notes or for payment of its Loan, the BankBoston Debt, the Facility
Lender Advances or enforcement (other than by exercising remedies with respect
to the Collateral) of any other obligation owing to it under the Loan Documents
or otherwise by the Company.
Section 3. Acknowledgment and Priorities. (a) Bear Stearns
hereby acknowledges and consents to the entrance by the Company into the Loan
Documents and the granting of the lien in the Collateral granted pursuant to
Section 2; provided, however, notwithstanding anything to the contrary contained
in the Loan Agreement, the Notes or any of the Loan Documents, the parties
hereto acknowledge and agree that any security interest in or other rights with
respect to any Collateral granted to secure the Existing Obligations under the
Existing Agreements or otherwise has and shall have priority over any security
interest in such Collateral granted pursuant to this Agreement, the Loan
Agreement or the other Loan Documents irrespective of:
(i) the time, order or method of attachment or perfection of
the security interest created by this Agreement, the Loan Agreement or
any Loan Document;
(ii) the time or order of filing or recording of financing
statements or other documents filed or recorded to perfect security
interests in any Collateral;
(iii) anything contained in any filing or agreement to which
the Facility Lenders, the Company, or the Collateral Agent under the
Security Documents now or hereafter may be a party, and
(iv) the rules for determining priority under the UCC or other
laws governing the relative priorities of secured creditors.
<PAGE>
(b) Bear Stearns hereby agrees, and the Company acknowledges,
that, promptly following the expiration of 91 days after payment in full of all
the Existing Obligations hereunder, any Collateral, including any books and
records (including, without limitation, computer files, printouts and other
computer materials and records) relating to the Collateral, as well as all
proceeds and products of such Collateral, held by it shall be held for the
benefit of the Facility Lenders, provided that if such Collateral is then
subject to the prior lien of another creditor, Bear Stearns may hold it for the
benefit of such other creditor and the Facility Lenders as their interests may
appear. If Bear Stearns has elected not to hold such Collateral following
payment in full of the Existing Obligations, it shall promptly forward any
Collateral, including any books and records (including, without limitation,
computer files, printouts and other computer materials and records) relating to
the Collateral, as well as all proceeds and products of such Collateral, to the
Collateral Agent, provided that if such Collateral is then subject to the prior
lien of another creditor, Bear Stearns may forward such Collateral, proceeds and
products thereof to such other creditor or, in the event of a dispute, to such
party as a court of competent jurisdiction may direct.
(c) Nothing contained in this Agreement shall alter or impair
Bear Stearns' rights under the Existing Agreements from and after the
termination of the Standstill Period in accordance herewith or be interpreted to
mean that Bear Stearns has any obligation under the Existing Agreements or
otherwise to return any proceeds received on a sale or deemed sale of any
Purchased MBS or Purchased Loan to the Company or any Subsidiary, except as
expressly provided herein.
(d) Each of the parties hereto consents to the transactions
contemplated by the Asset Purchase Agreement.
Section 4. Reserved Rights. (a) Notwithstanding anything in
this Agreement to the contrary, the Company and the Facility Lenders agree that
this Agreement shall in no manner impair any right of Bear Stearns under the
Existing Agreements to enforce any condition precedent to any obligation it may
have thereunder to engage in future Repurchase Transactions with the Company and
its Subsidiaries, nor shall this Agreement limit the right of Bear Stearns to
make Margin Calls in respect of the hedging transactions with respect
<PAGE>
to U.S. treasury securities that the Company may have entered into with Bear
Stearns outside of the Existing Agreements. All rights and obligations of Bear
Stearns under the Existing Agreements to enter into Repurchase Transactions or
not shall not be affected by this Agreement.
(b) In addition and notwithstanding anything to the contrary
contained herein (but subject to Section 8(f) hereof), this Agreement shall not
(i) apply to any Advances made from and after the date hereof, or any other
obligation of the Company or any of its Subsidiaries to Bear Stearns or any of
its Affiliates incurred from and after the date hereof or (ii) limit the rights
of Bear Stearns or any Affiliate thereof (x) subject to Section 8(f) hereof, to
purchase Mortgage Loans from the Company or any of its Subsidiaries, (y) to
receive principal and/or interest at the applicable mortgage rate on mortgage
loans purchased by Bear Stearns or any such Affiliate from the Company or any of
its Subsidiaries or (z) to sell mortgage loans to the Company or any of its
Subsidiaries.
Section 5. Fees; Amortization . During the Standstill Period,
the following provisions contained in this Section 5 shall apply:
(a) From and after the date this Agreement becomes effective
and prior to the date of the closing of the Asset Sale, within five days
following receipt by Bear Stearns each month of Available Cash Flow from
Securitization Receivables, Bear Stearns shall apply ninety percent (90%) of
such Available Cash Flow from Securitization Receivables to the repayment of
principal of the Existing Obligations relating to the Purchased MBS's generating
such Available Cash Flow from Securitization Receivables and shall remit the
balance of such Available Cash Flow from Securitization Receivables to the
Company.
(b) Upon the closing of the Asset Sale, the Company shall pay
to Bear Stearns the sum of (x) its Pro-Rata Share of the product of (A) seventy
percent (70%) and (B) the Transaction Proceeds Amount, plus (y) the Warehouse
Debt Shortfall with respect to Bear Stearns and minus (z) the Henschel Make-up
Amount, in each case to be applied to repayment of principal of the Existing
Obligations.
(c) Upon the closing of the Asset Sale, the Company shall pay
to the Facility Lenders and the Henschels, as their interests may appear
pursuant to the Henschel Intercreditor Agreement, the sum of (x) the product of
(A) thirty
<PAGE>
percent (30%) and (B) the Transaction Proceeds Amount, plus (y) three times the
Henschel Make-up Amount, in the case of the Facility Lenders, to be applied to
repayment of principal of the BankBoston Debt until such Debt is paid in full,
and then to repayment of the Loans and any other obligations due the Facility
Lenders, and, in the case of the Henschels, to be applied to repayment of the
Henschel Note Obligations.
(d) Upon the closing of the Asset Sale, the Company shall pay
to the Facility Lenders the sum of the CMC Advance Proceeds and the Delinquent
Interest Advance Shortfall Amount, in each case to be applied to repayment of
all obligations owing in respect of any outstanding Facility Lender Advances.
(e) Upon the closing of the Asset Sale, the Company shall pay
or reimburse Bear Stearns and the Facility Lenders for any Transaction Expenses
and Professional Fees then due and owing.
(f) Upon the closing of the Asset Sale, the Company shall
cause CMC to pay the Tax Escrow Amount to the escrow agent under the Tax Escrow
Agreement for deposit thereunder and application in accordance with the terms
thereof.
(g) Upon the closing of the Asset Sale, the Company shall
cause CMC to pay the Securitization Escrow Amount to the escrow agent under the
Securitization Escrow Agreement for deposit thereunder and application in
accordance with the terms thereof.
(h) Upon the closing of the Asset Sale, the Company shall
cause CMC to deposit a portion of the sale proceeds in an amount equal to the
NLC Amount in a separate bank account with a bank reasonably satisfactory to the
Creditors, solely for the benefit of the Creditors (and not for the benefit of
the Company), and not commingled with any funds of the Company, which shall be
applied from time to time solely for the purpose of making advances for
warehouse financing to National Lending Center, Inc., such warehouse financing
to mature not later than 90 days after the closing of the Asset Sale and to be
on terms and pursuant to documentation reasonably satisfactory to the Creditors,
which financing shall provide for all repayments in respect of such financing to
be paid directly for deposit to such account. Upon the date which is 90 days
after
<PAGE>
the closing of the Asset Sale and from time to time thereafter upon receipt of
the net proceeds of such warehouse financing, the amount on deposit in such
account shall, pursuant to irrevocable instructions given by the Company at or
before the closing of the Asset Sale, be immediately paid to the escrow agent
under the NLC Escrow Agreement for deposit and application thereunder.
(i) Upon the closing of the Asset Sale, the Company shall
apply the SafeCo Shortfall Amount to payment of the insurance premiums payable
to SafeCo.
(j) Upon the closing of the Asset Sale, the Company shall pay
to Bear Stearns and the Facility Lenders any accrued and unpaid Price
Differential or interest on the Existing Obligations, the BankBoston Debt and
the Loan Agreement to but not including the date of such closing.
(k) Any Reserve Release shall be made by the relevant escrow
agent pursuant to the Securitization Escrow Agreement, the NLC Escrow Agreement
or the Tax Escrow Agreement, as the case may be, to Bear Stearns, the Other
Existing Lenders, the Facility Lenders and the Henschels, as their interests may
appear pursuant to such escrow agreements.
(l) Promptly upon receipt by the Company of any Mortgage Sale
Excess Proceeds, the Company shall pay (x) to Bear Stearns an amount equal to
its Pro-Rata Share of the product of seventy percent (70%) and any Mortgage Sale
Excess Proceeds, to be applied to repayment of principal of the Existing
Obligations under the Existing Agreements, and (y) to the Facility Lenders and
the Henschels, as their interests may appear pursuant to the Henschel
Intercreditor Agreement, the product of thirty percent (30%) and any Mortgage
Sale Excess Proceeds, in the case of the Facility Lenders, to be applied to
repayment of principal of the BankBoston Debt until such Debt is paid in full,
and then to repayment of the Loans and any other obligations due the Facility
Lenders, and, in the case of the Henschels, to be applied to repayment of the
Henschel Note Obligations.
(m) Promptly upon the sale of any Mortgage Loan securing (or
purchased subject to a repurchase obligation comprising) any Existing
Obligations that gives rise to a Mortgage Sale Shortfall, the Company shall pay
Bear Stearns the amount of such Mortgage Sale Shortfall.
<PAGE>
(n) Within five days following receipt by Bear Stearns of
Available Cash Flow from Securitization Receivables during the month in which
the closing of the Asset Sale occurs, Bear Stearns shall (a) apply ninety
percent (90%) of the Available Cash Flow from Securitization Receivables for
such month to the repayment of principal of the Existing Obligations under the
Existing Agreements and (b) remit the balance of such Available Cash Flow from
Securitization Receivables to the Facility Lenders for payment to the Facility
Lenders and the Henschels, as their interests may appear pursuant to the
Henschel Intercreditor Agreement, in the case of the Facility Lenders, for
application to the repayment of principal of the Bank Boston Debt, until such
Debt is paid in full, and then to repayment of principal of the Loans and any
other obligations due the Facility Lenders, and, in the case of the Henschels,
to be applied to repayment of the Henschel Note Obligations.
(o) Not later than the 15th calendar day (or the next business
day, if the 15th is not a business day) after the end of each calendar month
ending on or after the closing of the Asset Sale, the Company shall prepare and
deliver to Bear Stearns a Monthly Statement and, following the receipt of such
Monthly Statement by Bear Stearns, the Available Post-Transaction Cash Flow with
respect to such month shall be distributed in each such month as follows:
(i) within five days following receipt by Bear Stearns of the
Monthly Statement for such month but not sooner than one
business day after receipt by Bear Stearns of the Available
Cash Flow from Securitization Receivables paid to Bear Stearns
that month, Bear Stearns or the Collateral Agent, if it shall
have received the Collateral pursuant to Section 3(b) hereof,
shall remit to the Company Bear Stearns' Allocable Share of
the Monthly Cash Flow Shortfall Amount, if any, from such
Available Cash Flow from Securitization Receivables, if any;
provided, that in the event there is a dispute (including any
dispute arising from the failure of the requisite Creditors to
approve any Monthly Statement) with respect to the calculation
of the Monthly Cash Flow Shortfall Amount, Bear Stearns shall
remit to the Company such portion of the Monthly Cash Flow
Shortfall Amount as calculated by the Company as is not in
dispute and shall remit any balance promptly upon resolution
of such dispute (it being understood and agreed that Bear
Stearns'
<PAGE>
obligation under this clause (i) for any month shall not
exceed the Available Cash Flow from Securitization Receivables
actually received that month);
(ii) until such time as the Existing Obligations have been repaid
in full:
(A) Bear Stearns shall (a) apply ninety percent (90%) of the
Available Cash Flow from Securitization Receivables for such
month remaining after the payment, if any, of Bear Stearns'
Allocable Share of the Monthly Cash Flow Shortfall Amount
pursuant to subsection (i) above, to the repayment of
principal of the Existing Obligations under the Existing
Agreements and (b) remit the balance, if any, of such
Available Cash Flow from Securitization Receivables to the
Facility Lenders for payment to the Facility Lenders and the
Henschels, as their interests may appear pursuant to the
Henschel Intercreditor Agreement, in the case of the Facility
Lenders, for application to the repayment of principal of the
BankBoston Debt, until such Debt is paid in full, and then to
repayment of principal of the Loans and any other obligations
due the Facility Lenders, and, in the case of the Henschels,
to be applied to repayment of the Henschel Note Obligations;
and
(B) the Company shall (a) remit to Bear Stearns for
application to the repayment of principal of the Existing
Obligations under the Existing Agreements Bear Stearns'
Allocable Share of an amount equal to 90% of the Monthly Free
Cash Flow Amount, if any, and (b) remit an amount equal to 10%
of the Monthly Free Cash Flow Amount to the Facility Lenders
for payment to the Facility Lenders and the Henschels, as
their interests may appear pursuant to the Henschel
Intercreditor Agreement, in the case of the Facility Lenders,
to be applied to repayment of principal of the BankBoston Debt
until such Debt is paid in full, and then to repayment of
principal of the Loans and any other obligations due the
Facility Lenders, and, in the case of the Henschels, to be
applied to repayment of the Henschel Note Obligations.
(iii) after such time as the Existing Obligations shall have been
repaid in full and until all obligations due to the Facility
Lenders and the
<PAGE>
Henschels have been paid in full:
(A) Bear Stearns, or the Collateral Agent, if it shall have
received the Collateral pursuant to Section 3(b) hereof, shall
remit Bear Stearns' Allocable Share of the Monthly Cash Flow
Shortfall Amount to the Company as provided in subsection (i)
above and remit 100% of the Available Cash Flow from
Securitization Receivables remaining after the remittance, if
any, in respect of the Monthly Cash Flow Shortfall Amount
pursuant to subsection (i) above, to the Facility Lenders for
payment to the Facility Lenders and the Henschels, as their
interests may appear pursuant to the Henschel Intercreditor
Agreement, in the case of the Facility Lenders, to be applied
to repayment of principal of the BankBoston Debt until such
Debt is paid in full, and then to repayment of principal of
the Loans and any other obligations due the Facility Lenders,
and, in the case of the Henschels, to be applied to repayment
of the Henschel Note Obligations, and
(B) the Company shall remit 100% of the Monthly Free Cash Flow
Amount, if any, to the Facility Lenders and the Henschels, as
their interests may appear pursuant to the Henschel
Intercreditor Agreement, in the case of the Facility Lenders,
to be applied to repayment of principal of the BankBoston Debt
until such Debt is paid in full, and then to repayment of
principal of the Loans any other obligations due the Facility
Lenders, and, in the case of the Henschels, to be applied to
repayment of the Henschel Note Obligations.
(p) The Company shall immediately pay Bear Stearns for
application to the Existing Obligations an amount equal to the Net Proceeds of
Sale of Securitization Receivables in respect of any Purchased MBS and the net
proceeds of any sale of Purchased Loans comprising a portion of the Collateral,
in each case which are sold or otherwise disposed of by the Company or any
Subsidiary. The Company shall not sell or otherwise dispose of any Purchased MBS
or any such Purchased Loan without Bear Stearns' and, in the case of any
Purchased MBS, each other Creditor's consent, such consent not to be
unreasonably withheld or delayed by Bear Stearns, such other Creditors or the
<PAGE>
Company (it being understood and agreed that the delivery by Bear Stearns of a
release of its lien in respect of a Purchased Loan being sold shall constitute
conclusive evidence of such consent). The parties agree that it would be
reasonable for Bear Stearns and each other Creditor to withhold its consent to
any such sale if, in its sole discretion, Bear Stearns or, in the case of any
sale of any Purchased MBS, such other Creditor concludes that (i) such sale will
impair its ability to be paid the Existing Obligations or the obligations due
such other Creditor, (ii) such sale will adversely affect the Available Cash
Flow from Securitization Receivables or Available Cash Flow from Other Creditor
Residuals, as the case may be, (iii) the selling price for the Purchased MBS or
any such Purchased Loan should be higher or (iv) the Purchased MBS or any such
Purchased Loan has not been adequately marketed.
(q) In the event the Company shall fail to pay when due any
amount due to Bear Stearns under this Agreement, Bear Stearns may set off such
amount against Available Cash Flow from Securitization Receivables or payments
on Purchased Loans otherwise payable to the Company hereunder.
Section 6. Conditions Precedent. The effectiveness of this
Agreement shall be subject to the condition that each of the other Existing
Lenders listed on Schedule I (the "Other Existing Lenders") shall have entered
into an Other Intercreditor Agreement in the form annexed hereto, and the
Company, the Facility Lenders and the Henschels shall have entered into the
Henschel Intercreditor Agreement and the Company, the Creditors and the
applicable escrow agents shall have entered into the Tax Escrow Agreement, the
NLC Escrow Agreement and the Securitization Escrow Agreement. The Company shall
furnish Bear Stearns complete and correct copies of each such Other
Intercreditor Agreement and the Henschel Intercreditor Agreement within one
business day of its execution.
Section 7. Certain Definitions.
"Allocable Share" means, with respect to the Monthly Cash Flow
Shortfall Amount, the percentage obtained by dividing (i) Available Cash Flow
from Securitization Receivables for such month by (ii) the sum of Available Cash
Flow from Securitization Receivables and Available Cash Flow from Other Creditor
Residuals for such month and, with respect to any Monthly Free Cash Flow Amount,
means the percentage determined by dividing (i) the aggregate amount of Residual
Debt then outstanding owing to the Existing Lender by (ii)
<PAGE>
the aggregate amount of Residual Debt then outstanding owing to the Existing
Lender or any Other Residual Lender.
"Asset Sale" has the meaning specified in the recitals.
"Available Cash Flow from Other Creditor Residuals" means the
amount of any distribution with respect to, or repayment of, the Residuals
pledged or sold, subject to repurchase obligations, by the Company and its
Subsidiaries to any Other Existing Lender and accepted by such Lender in
connection with the financing of such Residuals.
"Available Cash Flow from Securitization Receivables" means
the amount of any distribution with respect to, or prepayment of, any Purchased
MBS.
"Available Post-Transaction Cash Flow" means the sum of (i)
the Available Cash Flow from Securitization Receivables, (ii) the Available Cash
Flow from Other Creditor Residuals, (iii) the Non-Residual Cash Proceeds, (iv)
plus or minus the Operating Expense Differential, (v) minus the Operating
Expenses for the third succeeding month (except for any such month to which the
Initial Operating Expenses Amount relates) and (vi) minus for each of the months
of January and February, 2000, the cash interest payable to Creditors for that
month.
"BankBoston Debt" means the indebtedness of the Company owing
to the Facility Lenders in respect of the (i) Bridge Loan and Security
Agreement, dated as of October 10, 1997, as amended from time to time, by and
among the Company, certain of its Subsidiaries and BankBoston N.A., to which the
GSCP Funds have succeeded by assignment and (ii) a Loan and Security Agreement,
dated December 31, 1996, as amended from time to time, by and among the Company,
certain of its Subsidiaries and BankBoston N.A., to which the GSCP Funds have
succeeded by assignment.
"Business Plan" means a business plan of the Company and its
Subsidiaries prepared each month, which shall not provide for the conduct of any
business except that permitted pursuant to Section 8(g) hereof, and showing on a
monthly basis (a) an estimate of all Operating Expenses for the succeeding
<PAGE>
twelve month period, and (b) actual Operating Expenses for the prior three
months (or such shorter period commencing on the day of the closing of the Asset
Sale), which plan shall have been prepared by the Company and approved, in the
case of the Initial Business Plan and the Business Plan for each successive
twelve-month period succeeding that covered by the Initial Business Plan (each
such Business Plan so approved, a "Subsequent Approved Business Plan"), by GSCP
and two of the other Creditors, or, if there are at least one but fewer than
three other Creditors with outstanding Existing Obligations (as defined herein
or in their respective Other Intercreditor Agreements), by GSCP and at least one
such Other Creditor and, in the case of each other Business Plan, by GSCP, such
approval not to be unreasonably withheld or delayed.
"Change of Control" means the occurrence of any of the
following events (other than as a consequence of the issuance of the Preferred
Stock to the Facility Lenders upon exercise of the Exchange Option or the
closing of the Asset Sale):
(i) the Company consummates any sale, lease, exchange
or other disposition of all or substantially all of the assets
of the Company in any transaction or series of transactions
not in the ordinary course of business and not contemplated by
a Business Plan; or
(ii) the Company engages in a merger, consolidation
or similar business combination with any third party.
"CMC Advance Proceeds" means any payments received by the
Company from CMC upon the closing of the Asset Sale in connection with CMC's
purchase from the Company of certain delinquent interest servicing advances
funded by and securing the Facility Lender Advances.
"Collateral" means (i) any rights of the Company in any
Eligible Asset transferred by the Company or its Subsidiaries to Bear Stearns in
connection with either a Repurchase Transaction or in response to a Margin Call;
(ii) all rights of the Company under the Existing Agreements, including the
Company's right to reacquire the Eligible Assets pursuant to the terms of the
Existing Agreements, the contractual right to receive payments, including the
right to payments of principal and interest and the right to enforce such
payments, arising from or under any of the Eligible Assets; (iii) the Company's
<PAGE>
contractual right to service Purchased HELs (as defined in the Whole Loan
Repurchase Agreement); (iv) any other right, interest or property of the Company
or any Subsidiary now or hereafter securing the performance by the Company or
any Subsidiary of the Existing Obligations and (v) any and all proceeds,
payments, income, profits and products thereof, and all files and records
relating thereto.
"Common Stock" means the Company's common stock, par value
$0.001 per share.
"Company" means IMC Mortgage Company, a Florida corporation,
and any successor by merger and any entity purchasing all or substantially all
of the assets of the Company (other than pursuant to the Asset Purchase
Agreement).
"Creditor" means any of the Facility Lenders, Bear Stearns or
any Other Existing Lender.
"Delinquent Interest Advance Shortfall Amount" means the
amount of any obligations owing to the Facility Lenders in respect of the
Facility Lender Advances after giving effect to the payment by the Company to
the Facility Lenders of the CMC Advance Proceeds, which is estimated to be
approximately the amount set forth on Schedule III hereto corresponding to the
line entitled "Delinquent interest advance shortfall."
"Delinquent Mortgage Loan" means any Mortgage Loan which, as
of any date of determination, is more than 90 days delinquent in payment of any
principal or interest due thereunder.
"Designated Subsidiary" means National Lender Center until 366
days after the date on which any remaining advances made by the Company to
National Lending Center, Inc. shall have been repaid or written off and the net
proceeds thereof paid to the escrow agent under the NLC Escrow Agreement
pursuant to Section 5(h) hereof.
"Eligible Asset" means any Purchased HELs under the Whole Loan
Repurchase Agreement, Purchased MBS under the Residuals Repurchase Agreement, or
asset held on repurchase under the Existing Agreements and any
<PAGE>
assets transferred by the Company or its Subsidiaries to Bear Stearns pursuant
to a Margin Call.
"Henschel Make-up Amount" means the product of (i) 25% and
(ii) the excess if any of (A) $600,000 over (B) the amount the Henschels would
have received pursuant to Section 7(a) of the Henschel Intercreditor Agreement
if the Facility Lenders had no obligation to pay the Minimum Payment (as defined
in Section 7(a) of the Henschel Intercreditor Agreement).
"Initial Business Plan" means the initial Business Plan, a
copy of which is attached hereto as Schedule IV.
"Initial Operating Expenses Amount" means a good faith
estimate of the Company of Operating Expenses for the period commencing with the
day of the Closing of the Asset Sale and ending on the last day of the third
full calendar month thereafter (except for cash interest payable to the
Creditors for the months of January and February, 2000).
"LIBOR" means the London interbank offered rate for one-month
U.S. Dollar deposits as it appears on page five of the Telerate screen at or
about 9:00 a.m. (New York City time).
"Margin Call" means the right of Bear Stearns to give notice
to require the Company to transfer to Bear Stearns cash or additional
collateral.
"Monthly Free Cash Flow Amount" means, for any month, the
amount, if any, by which (i) the sum of (x) the Non-Residual Cash Proceeds, and
(y) any negative Operating Expense Differential exceeds (ii) the sum of (a) the
Operating Expenses for the third succeeding month (but only to the extent not
provided for in the Initial Operating Expenses Amount), (b) any positive
Operating Expense Differential, in each case, as set forth on the Monthly
Statement and (c) for each of the months of January and February, 2000, the cash
interest payable to the Creditors for that month.
"Monthly Cash Flow Shortfall Amount" means, for any month, the
amount, if any, by which (i) the sum of (a) the Operating Expenses projected by
the Company for the third succeeding month (but only to the extent not provided
for in the Initial Operating Expenses Amount), (b) any positive Operating
Expense Differential and (c) for each of the months of January and February,
<PAGE>
2000, the cash interest payable to the Creditors for that month exceeds (ii) the
sum of (x) the Non-Residual Cash Proceeds, and (y ) any negative Operating
Expense Differential, in each case, as set forth on the Monthly Statement.
"Monthly Statement" means a monthly cash flow statement and
projection prepared by the Company and approved in advance by GSCP or, if GSCP
declines to approve such statement, by two of the three other Creditors (and, if
the Operating Expenses (other than taxes, cash interest or Price Differential
payable on any obligations of the Company and any Mortgage Sale Shortfall) to be
incurred in any month are greater than the Operating Expenses (other than taxes,
cash interest [or Price Differential] payable on any obligations of the Company
and any Mortgage Sale Shortfall) for such month contained in the Initial
Business Plan or any Subsequently Approved Business Plan by more than (i) 10%,
by two of the three other Creditors, and (ii) 25%, by each Creditor), setting
forth the following: (i) the Available Cash Flow from Securitization Receivables
received during the prior month, (ii) the Available Cash Flow from Other
Creditor Residuals received during the prior month, (iii) the Non-Residual Cash
Proceeds received by the Company during the prior month, (iv) the amount of any
Reserve Release during the prior month, (v) the amount remaining on deposit
under the Tax Escrow Agreement, the NLC Escrow Agreement and the Securitization
Escrow Agreement, respectively, (vi) the estimated Operating Expenses to be
incurred by the Company and its Subsidiaries during the current month and the
third succeeding month, consistent with the Business Plan, (vii) the Operating
Expense Differential, (viii) any Mortgage Sale Excess Proceeds received or
Mortgage Sale Shortfall incurred, as the case may be, during the prior month,
(ix) any Monthly Cash Flow Shortfall Amount or Monthly Free Cash Flow Amount, as
the case may be, and, in the case of the Monthly Cash Flow Shortfall Amount,
Bear Stearns' and each Other Residual Lender's Allocable Share thereof, (x) the
Business Plan, and (xi) a capitalization table showing the indebtedness owing to
each creditor of the Company both as of the end of the prior month and after the
application of all amounts to be paid to such creditor pursuant to this Monthly
Statement and Section 5 hereof.
"Mortgage Loan" means any first-lien or second-lien
residential mortgage loan originated or serviced by the Company or its
Subsidiaries.
"Mortgage Sale Excess Proceeds" means (i) with respect to any
<PAGE>
Sixty Day Mortgage Loan, the amount of any proceeds from the sale or other
disposition of such loan in excess of eighty percent (80%) of the principal
outstanding on such Sixty Day Mortgage Loan as of November 5, 1999, and (ii)
with respect to any Ninety Day Mortgage Loan, the amount of any proceeds from
the sale or other disposition of such loan in excess of sixty-eight and 60/100's
percent (68.6%) of the principal outstanding on such Ninety Day Mortgage Loan as
of November 5, 1999.
"Mortgage Sale Shortfall" means (i) with respect to any Sixty
Day Mortgage Loan, the amount of any deficit of any proceeds from the sale or
other disposition of such loan relative to eighty percent (80%) of the principal
outstanding on such Sixty Day Mortgage Loan as of November 5, 1999, (ii) with
respect to any Ninety Day Mortgage Loan, the amount of any deficit of any
proceeds from the sale or other disposition of such loan relative to sixty-eight
and 60/100's percent (68.6%) of the principal outstanding on such Ninety Day
Mortgage Loan as of November 5, 1999 and (iii) with respect to any Mortgage Loan
(other than any Sixty Day Mortgage Loan or Ninety Day Mortgage Loan) sold or
otherwise disposed of after the closing of the Asset Sale and not included in
the proposed securitization of Mortgage Loans to which the Securitization Escrow
Agreement relates, any amount remaining outstanding on the applicable Creditor's
advances in respect of such Mortgage Loan after applying the net proceeds of the
sale of such Mortgage Loan (and after applying any amount distributed to the
applicable Creditor under the Securitization Escrow Agreement in respect of such
Mortgage Loan to repayment of the related advance) to repayment of the related
advance.
"Net Asset Sale Proceeds" means the cash proceeds received by
the Company upon the closing of the Asset Sale (including, without limitation,
the proceeds from the purchase by CMC of the servicing advances), net of any
Transaction Expenses and Professional Fees, and exclusive of the CMC Advance
Proceeds.
"Net Proceeds of Sale of Securitization Receivables" means the
proceeds, net of any reasonable out-of-pocket costs of sale or disposition,
realized by the Company or any Subsidiary from any sale, lease or other
disposition of any Purchased MBS.
"Ninety Day Mortgage Loans" means Mortgage Loans financed
(including by purchase subject to a repurchase obligation) by a Creditor which
are more than 90 days delinquent on November 5, 1999.
<PAGE>
"NLC Amount" means the amount set forth on Schedule III hereto
corresponding to the line entitled "NLC 90-day warehouse financing", which
represents the amount required to be reserved for warehouse financing to be
provided by the Company to National Lending Center, Inc. for a period not to
exceed 90 days following the closing of the Asset Sale.
"NLC Escrow Agreement" means an escrow agreement among the
Company, each of the Creditors, and a bank acting as escrow agent, reasonably
acceptable to each Creditor, which agreement is satisfactory in form and
substance to each Creditor, providing for the deposit of the proceeds of the
warehouse financing to be provided by the Company to National Lending Center,
Inc. upon the closing of the transactions contemplated by the Asset Purchase
Agreement into escrow thereunder.
"Non-Residual Cash Proceeds" means any cash inflow to the
Company other than the Available Cash from Securitization Receivables, the
Available Cash from Other Creditor Residuals and the cash proceeds received upon
the closing of the Asset Sale, but only to the extent such cash proceeds are
applied or remain in reserve for application to the purpose for which such
proceeds were reserved as contemplated by Schedule III hereto.
"One-Time Working Capital Amount" means an amount representing
the Company's good faith estimate of the amount required to be reserved for the
payment of certain expenses and the run off of certain working capital items and
set forth on Schedule III hereto corresponding to the line entitled "One-time
working capital amount."
"Operating Expenses" means, for any period, the operating
expenses of the Company and its Subsidiaries incurred or to be incurred in
accordance with the current Monthly Statement or Initial Operating Expenses
Amount estimate, as the case may be, including, without limitation, any Mortgage
Sale Shortfall and any cash interest payable on any obligations of the Company.
"Operating Expense Differential" means, with respect to any
Monthly Statement, the difference (positive or negative) between the actual
Operating Expenses for the prior month and the estimated Operating Expenses
<PAGE>
for such month reflected in the prior Monthly Statement (or, for the first such
statement, in the Initial Business Plan).
"Other Existing Lenders" has the meaning specified in Section
6.
"Other Intercreditor Agreements" means the separate
intercreditor agreements among the Company, an Other Existing Lender and the
Facility Lenders.
"Other Residual Lenders" means the Other Existing Lenders
which are owed Residual Debt.
"Person" means an individual, a corporation, a partnership, an
association, a trust or any other entity or organization, including a government
or political subdivision or an agency or instrumentality thereof.
"Price Differential" has the meaning given in the applicable
Existing Agreement.
"Pro-Rata Share" means the fraction derived by dividing (i)
the Residual Debt owing to Bear Stearns by (ii) the aggregate amount of the
Company's obligations in respect of Residual Debt, determined as of the date of
the closing of the Asset Sale.
"Purchased Loan" means any Mortgage Loan or Wet Mortgage Loan
that is transferred by the Company or its Subsidiaries to Bear Stearns in
connection with a Repurchase Transaction.
"Purchased MBS" means any security transferred to Bear Stearns
by the Company or any Subsidiary in connection with a Repurchase Transaction.
"Repurchase Transaction" means any transaction made by Bear
Stearns under the Existing Agreements.
"Reserve Release" means any release of funds to Bear Stearns,
the Other Existing Lenders, the Facility Lenders or the Henschels pursuant to
the Securitization Escrow Agreement, the Tax Escrow Agreement or the NLC Escrow
Agreement.
<PAGE>
"Residual" means any residual, subordinated or interest strip
class of asset-backed security (i) issued in connection with a securitization in
which any Creditor or its designee acted as lead or co-lead underwriter or
placement agent and (ii ) pledged or sold, subject to repurchase obligation, by
the Company and its Subsidiaries and accepted by such Creditor in connection
with the financing of such security.
"Residual Debt" means the amount of any indebtedness of the
Company or any Subsidiary owing to the Existing Lender or any Other Existing
Lender and incurred in connection with the financing (including by purchase
subject to a repurchase obligation) of any Residual.
"SafeCo Shortfall Amount" means the shortfall in the amount
received from CMC in connection with CMC's purchase of certain insurance
receivables of the Company in connection with the Asset Sale compared with the
corresponding insurance premium payables, an estimate of which is set forth on
Schedule III hereto corresponding to the line entitled "SafeCo shortfall."
"Securitization Escrow Agreement" means an escrow agreement
among the Company, each of the Creditors, and a bank acting as escrow agent,
reasonably acceptable to each Creditor, which agreement is satisfactory in form
and substance to each Creditor, providing for the deposit of the Securitization
Escrow Amount upon the closing of the transactions contemplated by the Asset
Purchase Agreement into escrow thereunder.
"Securitization Escrow Amount" means the amount set forth on
Schedule III hereto corresponding to the line entitled "Securitization Escrow
Amount."
"Seller's Guide" means the "IMC Mortgage Company Client
Operations Manual", together with the underwriting guidelines of the Company and
its Subsidiaries, a true and correct copy of which was previously provided to
Bear Stearns by the Company and its Subsidiaries.
"Sixty Day Mortgage Loans" means Mortgage Loans financed
(including by purchase subject to a repurchase obligation) by a Creditor which
are more than 60 days but not more than 90 days delinquent on November 5,
<PAGE>
1999.
"Sold Mortgage Loan" means any Mortgage Loan (other than any
Sixty Day Mortgage Loan or Ninety Day Mortgage Loan), sold or otherwise disposed
of by the Company prior to the closing of the Asset Sale.
"Standstill Period" means a period ending on the first to
occur of (i) the repayment in full of all Existing Obligations, all obligations
owed to the Facility Lenders and the Henschel Note Obligations, (ii) termination
of the Standstill Period in accordance with Section 1(b) or 1(c) hereof, (iii)
termination of the Asset Purchase Agreement or (iv) December 3, 1999, if the
closing of the Asset Sale shall not have occurred by such date.
"Subsidiary" means, with respect to any Person, any
corporation or other entity of which securities or other ownership interests
having ordinary voting power to elect a majority of the board of directors or
other persons performing similar functions are at the time directly or
indirectly owned by such Person.
"Tax Escrow Agreement" means an escrow agreement among the
Company, each of the Creditors, and a bank acting as escrow agent, reasonably
acceptable to each Creditor, which agreement is satisfactory in form and
substance to each Creditor, providing for the deposit of the Tax Escrow Amount
upon the closing of the transactions contemplated by the Asset Purchase
Agreement into escrow thereunder.
"Tax Escrow Amount" means the amount set forth on Schedule III
hereto corresponding to the line entitled "Tax Escrow Amount", which, together
with the NLC Amount, represents the Company's good faith estimate of the amount
required to be reserved for the payment of tax liabilities of the Company
associated with Federal and state income taxes payable with respect to the year
ended December 31, 1999.
"Transaction Expenses and Professional Fees" means any unpaid
transaction expenses or professional fees payable in connection with the Asset
Sale, the preparation or negotiation of the various intercreditor agreements,
the documentation relating to the Facility Lender Advances and any prior monthly
servicing advances, the Acquisition Agreement, the Asset Purchase Agreement, any
transactions contemplated by or related to such agreements or transactions
<PAGE>
or otherwise, an estimate of which is set forth in Schedule III hereto,
corresponding to the line entitled "Transaction expenses and professional fees."
"Transaction Proceeds Amount" means the amount derived by
subtracting from the Net Asset Sale Proceeds (A) the Tax Escrow Amount, (B) the
Securitization Escrow Amount, (C ) the One-Time Working Capital Amount, (D) the
Delinquent Interest Advance Shortfall Amount, (E) the SafeCo Shortfall Amount,
(F) the Initial Operating Expenses Amount, (G) the Warehouse Debt Shortfall and
( H) the NLC Amount.
"Warehouse Debt Shortfall" means the amount representing (i)
with respect to Sixty Day Mortgage Loans, the excess, if any, of the principal
outstanding on the applicable Creditor's advances in respect of such Sixty Day
Mortgage Loans on November 5, 1999 over 80% of the outstanding principal amount
of such Sixty Day Mortgage Loan; (ii) with respect to Ninety Day Mortgage Loans,
the excess, if any, of the principal outstanding on the applicable Creditor's
advances in respect of such Ninety Day Mortgage Loans on November 5, 1999 over
68.6% of the outstanding principal amount of such Ninety Day Mortgage Loan and
(iii) with respect to Sold Mortgage Loans, any amount remaining outstanding on
the applicable Creditor's advances in respect of such Sold Mortgage Loan after
applying the net proceeds of the sale of such Sold Mortgage Loan to repayment of
the related advance.
"Wet Mortgage Loan" means any residential mortgage loan
originated by the Company and its Subsidiaries in accordance with the Seller's
Guide, with respect to which all of the related documents required to be
delivered in connection with any Advance have not been deposited with the
custodian on or prior to the related Advance Date.
Section 8. Notice of Advances under the Loan Agreement, etc.
(a) The Company shall give each Creditor prompt written notice of any event
which upon notice or lapse of time or both would constitute an event of default
in respect of any of its outstanding Debt.
(b) The Company shall give Bear Stearns and the Facility
Lenders prompt written notice of any event that would permit termination of the
Standstill Period pursuant to Section 1(b) hereof.
<PAGE>
(c) The Company shall give Bear Stearns prompt written notice
of the entering into any amendment of the Asset Purchase Agreement and the
closing of the Asset Sale.
(d) Notwithstanding the provisions of the Existing Agreements,
during the Standstill Period, the Company shall pay the Price Differential
accrued under the Existing Agreements to Bear Stearns weekly on Friday of each
week or, if Friday is not a Business Day, on the next Business Day and from and
after the closing of the Asset Sale, the Price Differential rate applicable to
the Existing Obligations shall be equal to LIBOR plus 300 basis points.
(e) The Company shall not repay any principal outstanding
under the Loan Agreement during the Standstill Period, except pursuant to
Section 5 hereof.
(f) In the event all remaining Purchased Loans have not been
sold by the Company on or before the date which is 180 days following the
closing of the Asset Sale, Bear Stearns may buy such Purchased Loans at their
then fair market value (as determined by independent third-party bid) or arrange
for the sale of such Purchased Loans to third parties at such fair market value,
and the Company shall take such actions and execute such customary agreements
and instruments as may be necessary to effect such sale and transfer good and
marketable title to such Purchased Loans to the purchaser thereof.
(g) Until all of the Company's obligations under this
Agreement, the Other Intercreditor Agreements, the Existing Agreements and the
Loan Agreement have been satisfied in full, the Company shall not conduct any
business or engage in any activities other than (a) liquidating its assets in an
orderly fashion and performing its obligations under (i) the Asset Purchase
Agreement, (ii) this Agreement (including its obligations under the Existing
Agreements), (iii) the Other Intercreditor Agreements and the Henschel
Intercreditor Agreement and the agreements evidencing the indebtedness owing to
such other Creditors and the Henschels, (iv) the Tax Escrow Agreement, the NLC
Escrow Agreement and the Securitization Escrow Agreement, (v) any other
agreements existing on the date hereof and (v) satisfying its other obligations
and liabilities, (b) transacting any other lawful business under its certificate
of incorporation and by-laws that is incident, necessary and appropriate to
accomplish the foregoing, including defending any actions or proceedings. The
<PAGE>
Company shall maintain not more than a commercially reasonable number of
employees necessary to conduct the foregoing activities. The Company shall not
incur any indebtedness for borrowed money other than liabilities incurred in the
ordinary course of its business (as such business is limited under the preceding
provision), and not grant any new liens (except as may be incidental to the
foregoing permitted activities).
Section 9. Acknowledgment of Obligations. The Company
acknowledges that its obligations under the Existing Agreements and Bear
Stearns' rights under the Existing Obligations remain in full force and effect,
and that the Company has no defenses, counterclaims or offsets to its
obligations under the Existing Agreements and that to the extent such rights
include liens on the Collateral, such liens are valid, perfected and
enforceable. The Company hereby waives the application of the automatic stay in
any bankruptcy proceeding in respect of the Existing Obligations and the
obligations under the Loan Documents and the Company and each Creditor consents
to the modification of the stay to permit the exercise by Bear Stearns or the
Facility Lenders of their rights in respect of the Collateral, provided that the
foregoing shall not be construed to modify the provisions of Sections 2(b) and 3
hereof. This document shall not constitute a waiver, amendment or modification
of the Existing Agreements, the Existing Obligations or the Loan Documents
except as expressly referred to herein and shall not be construed as a waiver or
consent to any future action on the part of the Company that would require a
waiver or consent of Bear Stearns or the Facility Lenders, respectively, except
to the extent expressly provided herein. The Company acknowledges that BSTrust
and BSIL are affiliates for purposes of the Institutional Account Agreement. The
Company and each Subsidiary hereby releases Bear Stearns, their respective
officers, directors and participants from any and all claims in respect of the
Existing Agreements and in respect of actions taken or not taken in connection
therewith on or prior to the date of execution and delivery hereof, excluding,
however, any obligation under any agreement by such person for the payment of
money, return of property or any contractual obligations. Effective upon the
closing of the Asset Sale and the receipt by the Creditors of the payments to be
received hereunder from the proceeds of the Asset Sale, the Existing Lender
hereby releases the executive officers and the directors of the Company from any
and all claims in respect of the Existing Agreements and in respect of the
actions taken or not taken in connection therewith on or prior to the date of
<PAGE>
execution and delivery hereof, excluding, however, any obligations under any
agreement by such person for the payment of money, return of property or any
contractual obligations, and also excluding any claims in respect of fraud or
intentional misconduct.
Section 10. Amendments, Etc. No amendment, modification,
supplement, termination, consent or waiver of this Agreement or any term or
provision of this Agreement shall be effective and binding unless in writing and
signed by Bear Stearns, the Other Existing Lenders and the Facility Lenders. Any
such waiver will be effective only in the specific instance and for the specific
purpose for which it is given.
Section 11. Severability. Any provision of this Agreement
which is illegal, invalid, prohibited or unenforceable in any jurisdiction
shall, as to such jurisdiction, be ineffective to the extent of such illegality,
invalidity, prohibition or unenforceability without invalidating or impairing
the remaining provisions hereof or affecting the validity or enforceability of
such provision in any other jurisdiction.
Section 12. WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO
HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL OR
EQUITABLE ACTION, SUIT OR PROCEEDING ARISING OUT OF OR RELATING TO THIS
AGREEMENT, OR ANY TRANSACTION CONTEMPLATED HEREBY OR THE RELATIONSHIP
ESTABLISHED HEREUNDER.
Section 13. GOVERNING LAW; VENUE AND JURISDICTION. THE
VALIDITY OF THIS AGREEMENT, THE CONSTRUCTION, INTERPRETATION AND ENFORCEMENT
HEREOF AND THE RIGHTS OF THE PARTIES HERETO SHALL BE DETERMINED UNDER, GOVERNED
BY, AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK
WITHOUT GIVING EFFECT TO CONFLICTS OF LAW PRINCIPLES THEREOF. EACH OF THE
PARTIES HERETO SUBMITS TO THE NON-EXCLUSIVE JURISDICTION OF, AND AGREES THAT ALL
ACTIONS OR PROCEEDINGS ARISING IN CONNECTION WITH THIS AGREEMENT MAY BE TRIED
AND LITIGATED IN, FEDERAL OR, IN THE ABSENCE OF FEDERAL SUBJECT MATTER
<PAGE>
JURISDICTION, STATE COURTS LOCATED IN THE COUNTY OF NEW YORK, STATE OF NEW YORK
UNLESS SUCH ACTIONS OR PROCEEDINGS ARE REQUIRED TO BE BROUGHT IN ANOTHER COURT
TO OBTAIN SUBJECT MATTER JURISDICTION OVER THE MATTER IN CONTROVERSY. EACH OF
THE PARTIES WAIVES, TO THE FULLEST EXTENT PERMISSIBLE UNDER APPLICABLE LAW, ANY
RIGHT IT MAY HAVE TO ASSERT BY WAY OF MOTION, AS A DEFENSE OR OTHERWISE THE
DOCTRINE OF FORUM NON CONVENIENS OR TO OBJECT TO VENUE IN ANY PROCEEDING
BROUGHT IN ACCORDANCE WITH THE IMMEDIATELY PRECEDING SENTENCE. SERVICE OF
PROCESS, SUFFICIENT FOR PERSONAL JURISDICTION IN ANY ACTION AGAINST SUCH PARTY,
MAY BE MADE BY REGISTERED OR CERTIFIED MAIL, RETURN RECEIPT REQUESTED, TO ITS
ADDRESS INDICATED IN SECTION 16.
Section 14. Expenses. In addition to the foregoing, the
Company will also reimburse Bear Stearns and the Facility Lenders promptly for
their reasonable out-of-pocket costs and expenses incurred by such Persons or
their respective employees, agents or advisors in connection with the
performance of their respective obligations and duties hereunder and to the
extent the Existing Agreements so provide, under the Existing Agreements, and
for any reasonable fees and expenses of legal or other professional advisors to
Bear Stearns and the Facility Lenders engaged in connection with the preparation
and negotiation of this Agreement and review and negotiation of all related
documents, including the Asset Purchase Agreement and the Loan Agreement, and
monitoring performance of all related documents. If such costs and expenses are
not paid by the Company within 30 days of submission, Bear Stearns may pay such
fees from Available Cash Flow from Securitization Receivables and payments on
Purchased Loans, in which event appropriate adjustments shall be made to Bear
Stearns' and each Other Residual Lender's Allocable Share of Available Cash Flow
from Securitization Receivables as if such costs and expenses were paid by the
Company as Operating Expenses.
Section 15. Agreement May Constitute Financing Statement. The
Company and Bear Stearns consents to the filing of this Agreement or a photocopy
thereof as a financing statement under the UCC as in effect in any jurisdiction
in which the Facility Lenders may determine such filing to be necessary or
desirable.
Section 16. Notices. All notices, requests and other
communications to any party hereunder shall be in writing and shall be given
to
<PAGE>
such party by facsimile transmission or by hand delivery at the following
address or facsimile number, or such other address or facsimile number as such
party may hereafter specify for the purpose by notice to the other party and
each other Creditor, (a) if to the Facility Lenders, Greenwich Street Capital
Partners II, L.P., c/o Greenwich Street Capital Partners, Inc., 388 Greenwich
Street, New York, New York 10013, Attn.: Sanjay Patel; Tel: (212) 816-1149, Fax:
(212) 816-0166; with a copy to Debevoise & Plimpton, 875 Third Avenue, New York,
New York 10022, attention: Steven Ostner, Esq., Tel: (212) 909-6000, Fax: (212)
909-6836; (b) if to the Company, IMC Mortgage Company, 5901 E. Fowler Avenue,
Tampa, Florida 33617, Attn.: President, Tel: (813) 984-2507, Fax: (813)
984-2594; with a copy to Mitchell W. Legler, 300A Wharfside Way, Jacksonville,
Florida 32207, Tel: (904) 346-3200, Fax: (904) 346-3299; and (c) and if to Bear,
Stearns: Bear Stearns & Co. Inc., 245 Park Avenue, New York, New York 10167,
Attn: Philip M. Cedar, Tel.: (212) 272-6768, Fax: (212) 272-4933 and Paul
Friedman, Tel.: (212) 272-3516, Fax: (212) 272-6550, with a copy to; Cadwalader,
Wickersham & Taft, 100 Maiden Lane, New York, New York 10038, Attn. Barry J.
Dichter, Esq., Tel.: (212) 504-6000, Fax: (212) 504-6666; and if to any of the
Other Existing Lenders, to such person and at the address and facsimile number
provided in Schedule II hereto. Each such notice, request or other
communication shall be effective when sent by facsimile transmission to the
facsimile number or when delivered by hand to the address specified in this
Section 16 or Schedule II hereto, provided that a facsimile transmission shall
be deemed to have been sent only so long as the transmitting machine has
provided an electronic confirmation of such transmission.
Section 17. Binding Effect; Third Party Beneficiaries. This
Agreement shall be binding upon and inure to the benefit of the parties hereto
and their successors and permitted assigns, including any successor of the
Company by merger or any entity which purchases all or substantially all of the
assets of the Company (other than pursuant to the Asset Sale), and to each of
the other Creditors, and, as to Section 3(d) hereto, CMC, each of which is an
intended third-party beneficiary hereof. Neither the Facility Lenders nor Bear
Stearns may sell, assign, participate or otherwise transfer or dispose of all or
any portion of the Loan or the Existing Obligations to any Person unless such
Person shall have assumed and agreed to be bound by the terms hereof by written
instrument in form reasonably satisfactory to the Company and each other
Creditor.
Section 18. Interpretation; Transaction Intended as Purchases
and
<PAGE>
Sales. The parties specifically acknowledge and recognize that certain language
and use of words in this Agreement may erroneously suggest that transactions
under the Existing Agreements are intended by them to be characterized as loans
or other secured financing arrangements and not as absolute purchases and sales
of mortgage loans and hereby reaffirm that all such transactions are intended to
constitute absolute purchases and sales.
Section 19. Counterparts; Section Headings. This Agreement may
be executed in any number of counterparts, each of which is an original, but all
of which together constitute but one instrument. Except as otherwise indicated,
references herein to any "Section" means a "Section" of this Agreement, and
the section headings in this Agreement are for purposes of reference only and
shall not limit or define the meaning hereof.
<PAGE>
IN WITNESS WHEREOF, the parties have caused this Agreement to
be duly executed as of the date first above written.
IMC MORTGAGE COMPANY
By: /s/
-------------------------------
Name:
Title:
BEAR STEARNS HOME EQUITY TRUST
By: /s/
-------------------------------
Name:
Title:
BEAR STEARNS INTERNATIONAL LIMITED
By: /s/
-------------------------------
Name:
Title:
<PAGE>
GREENWICH STREET CAPITAL PARTNERS II, L.P.
GSCP OFFSHORE FUND, L.P.
GREENWICH FUND, L.P.
GREENWICH STREET
EMPLOYEES FUND, L.P.
TRV EXECUTIVE FUND, L.P.
By: GREENWICH STREET
INVESTMENTS II, L.L.C.,
their General Partner
By: /s/
-------------------------------
Name:
Title:
<PAGE>
This Intercreditor Agreement is hereby acknowledged and agreed to by:
IMC CORPORATION OF AMERICA
IMC CREDIT CARD, INC.
IMC MORTGAGE COMPANY CANADA, LTD.
AMERICAN HOME EQUITY CORPORATION
IMC INVESTMENT CORPORATION
IMC INVESTMENT LIMITED PARTNERSHIP
ACG FINANCIAL SERVICES (IMC), INC.
AMERICAN MORTGAGE REDUCTION, INC.
CENTRAL MONEY MORTGAGE CO. (IMC), INC.
COREWEST BANC
EQUITY MORTGAGE CO. (IMC), INC.
IMCC INTERNATIONAL, INC.
MORTGAGE AMERICA (IMC), INC.
NATIONAL LENDING CENTER, INC.
NATIONAL LENDING CENTER TILT, INC.
NATIONAL LENDING GROUP, INC.
RESIDENTIAL MORTGAGE CORPORATION (IMC), INC.
By: /s/
----------------------------------------
Name:
Title:
PAINE WEBBER REAL ESTATE SECURITIES INC.
By: /s/
----------------------------------------
Name:
Title:
<PAGE>
GERMAN AMERICAN CAPITAL CORPORATION
By: /s/
----------------------------------------
Name:
Title:
By: /s/
----------------------------------------
Name:
Title:
<PAGE>
Schedule I
to the
Bear Stearns Intercreditor Agreement
Other Existing Lenders
1. Loan and Security Agreement, dated March 17, 1998, by and among IMC
Mortgage Company, IMC Corporation of America, ACG Financial Services
(IMC), Inc., American Mortgage Reduction, Inc., Central Money Mortgage
Co. (IMC), Inc., Corewest Banc, Equity Mortgage Co., (IMC), Inc.,
Mortgage America (IMC), Inc., National Lending Center, Inc., National
Lending Center TILT, Inc, and Residential Mortgage Corporation (IMC),
Inc., as borrowers, and German American Capital Corporation, as lender.
2. Loan and Security Agreement, dated March 17, 1998, by and among IMC
Mortgage Company, IMC Corporation of America, ACG Financial Services
(IMC), Inc., American Mortgage Reduction, Inc., Central Money Mortgage
Co. (IMC), Inc., Corewest Banc, Equity Mortgage Co., (IMC), Inc.,
Mortgage America (IMC), Inc., National Lending Center, Inc., National
Lending Center TILT, Inc, and Residential Mortgage Corporation (IMC),
Inc., as borrowers, and German American Capital Corporation, as
successor by assignment from Aspen Funding Corp., as lender.
3. Loan and Security Agreement, dated as of February 28, 1997, between IMC
Mortgage Company, IMC Corporation of America, ACG Financial Services
(IMC), Inc., American Mortgage Reduction, Inc., Industry Mortgage
Company, L.P., Corewest Banc, IMC Investment Corp., and IMC Investment
Limited Partnership, as borrowers, and Paine Webber Real Estate
Securities, Inc., as lender.
4. (i) Bridge Loan and Security Agreement, dated as of October 10, 1997,
as amended from time to time, by and among the Company, certain of its
Subsidiaries and BankBoston N.A., to which the Facility Lenders have
succeeded by assignment, and (ii) a Loan and Security Agreement, dated
December 31, 1996, as amended from time to time, by and among the
Company, certain of its Subsidiaries and BankBoston N.A., to which the
Facility Lenders have succeeded by assignment.
<PAGE>
Schedule II
to the
Bear Stearns Intercreditor Agreement
Notice Address for Other Existing Lenders
Paine Webber
if to Paine Webber, to: PaineWebber Real Estate Securities, Inc., 1285 Avenue of
the Americas, New York, New York 10019, Attn.: George Mangiaracina, Tel: (212)
713-3734, Fax: (212) 265-3881; with a copy to Cadwalader, Wickersham & Taft, 100
Maiden Lane, New York, New York 10038, Attn.: Michael S. Gambro, Esq., Tel:
(212) 504-6825; Fax: (212) 504-6666
Deutsche Lenders
if to German American Corporation, to: German American Capital Corporation, 31
West 52nd Street, New York, New York 10019, Attn.: Vijay Radhakishun, Tel.:
(212) 469-8925, Fax: (212) 469-5923, with a copy to: Deutsche Bank A.G., as
agent, 31 West 52nd Street, New York, New York 10019, Attn.: Greg Amoroso, Tel.:
(212) 469-3987, Fax: (212) 469-5160, and Richard Uhlig, Tel.: (212) 469-7730,
Fax: (212) 469-5103; and in either case described in clause (i) or (ii) above;
with a copy to Cadwalader, Wickersham & Taft, 100 Maiden Lane, New York, New
York 10038, Attn.: Karen Gelernt, Esq., Tel: (212) 504-6000, Fax: (212) 504-6666
BankBoston Facility
if to the Facility Lenders, as successors in interest to BankBoston, to: the
address provided for notice to the Facility Lenders pursuant to Section 16 of
the foregoing Agreement
<PAGE>
Sources and Uses of Cash from Asset Sale
($ 000)
Sources:
Proceeds from Asset Sale $____
Reimbursement of corporate servicing advances $____
Less Discount 10.45% $____
Reimbursement of delinquent interest advance
Less discount
Net reimbursement $____
Total net sources of cash $____
Uses:
Transaction expenses and professional fees:
Debevoise & Plimpton
DLJ
Kramer, Levin
Bear, Stearns
Bear, Stearns
DMG
Greenwich Capital
Commercial Credit
Corewest settlement
Others (proxy solicitation,
accountants, etc.) ____
Total transaction expenses and professional
fees
Tax Escrow Amount
NLC 90-day warehouse financing
Securitization Escrow Amount
SafeCo shortfall
Delinquent interest advance shortfall
Warehouse shortfall
One-time working capital amount:
Vacation pay
<PAGE>
Interest expense on November 15, 1999
Litigation costs
Accounts payable and accrued
expenses estimated at November 15, 1999
(IMC parent)
Accounts payable and accrued
expenses estimated at November 15, 1999
(subsidiaries)
Miscellaneous/unknown/working capital ____
Total one-time working capital amount ____
Total uses of cash ____
Excess of sources over uses of cash $____
Exhibit 10.84
SECOND AMENDED AND RESTATED FORBEARANCE
AND INTERCREDITOR AGREEMENT
(BankBoston Debt)
SECOND AMENDED AND RESTATED FORBEARANCE AND INTERCREDITOR
AGREEMENT, dated as of November 10, 1999, between IMC MORTGAGE COMPANY, a
Florida corporation (the "Company"), GREENWICH STREET CAPITAL PARTNERS II, L.P.,
a Delaware limited partnership ("GSCP"), GREENWICH FUND, L.P., a Delaware
limited partnership, GSCP OFFSHORE FUND, L.P., a Cayman Islands exempted limited
partnership, GREENWICH STREET EMPLOYEES FUND, L.P., a Delaware limited
partnership, TRV EXECUTIVE FUND, L.P., a Delaware limited partnership (each a
"Facility Lender" and collectively, the "Facility Lenders"), and the Facility
Lenders as successors to the right, title and interest of BANKBOSTON, N.A. in,
to and under the Existing Loan Documents (as defined below) (the "Existing
Lenders"). Capitalized terms used in this Agreement without definition have the
meanings given to them in the Loan Agreement (as hereinafter defined) as such
terms are defined in the Loan Agreement on the date hereof (or as amended by any
amendment thereto approved by the Existing Lenders).
RECITALS
A. The Company has entered into a Loan Agreement, dated as of
October 12, 1998, amended by Amendment No. 1 thereto, dated as of February 11,
1999 (as the same may be further modified, supplemented or restated from time to
time, the "Loan Agreement"), between the Company, as borrower, and the Facility
Lenders, pursuant to which the Facility Lenders have extended to the Company
loans in the aggregate principal amount of $38,000,000 (the "Loans"), subject to
the terms and conditions set forth in the Loan Agreement, which Loans are
evidenced by the Notes and entitled to the benefit of certain guarantees and
security provided to the Facility Lenders or to GSCP, as collateral agent (the
"Collateral Agent") under certain of the other Loan Documents.
B. The Facility Lenders have made certain additional loans to
the Company pursuant to Note Purchase and Amendment Agreement No. 6, dated as of
October 18, 1999, in the original principal amount of $61,500,000 (the "Facility
Lender Advances") to fund certain monthly delinquent interest servicing advances
in respect of the Company's securitizations.
C. Pursuant to (i) a Bridge Loan and Security Agreement, dated
as of October 10, 1997, as amended from time to time, by and among the Company,
certain of
<PAGE>
its Subsidiaries and the Existing Lenders as successors to BankBoston, N.A. (the
"Bridge Loan Agreement"), (ii) a Loan and Security Agreement, dated December 31,
1996, as amended from time to time, by and among the Company, certain of its
Subsidiaries and the Existing Lenders as successors to BankBoston, N.A. (the
"1996 Agreement", and together with the Bridge Loan Agreement, the "Existing
Loan Agreements"), and other related agreements in favor of the Existing Lenders
as successors to BankBoston, N.A. (collectively with the Existing Loan
Agreements, the "Existing Loan Documents"), the Existing Lenders have agreed to
provide financing to the Company from time to time, to enable the Company to
finance certain mortgage loans and for other purposes provided therein; and the
Company and certain of its Subsidiaries have granted a security interest in the
Collateral (as hereinafter defined) in order to secure their respective
obligations under the Existing Loan Documents (the "Existing Obligations").
D. The Facility Lenders have succeeded by assignment to the
right, title and interest of BankBoston N.A. in, to and under the Existing Loan
Agreements and have assumed the obligations of BankBoston, N.A. thereunder and
under the Original Intercreditor Agreement (as hereinafter defined).
E. The Company entered into an Acquisition Agreement (the
"Acquisition Agreement"), dated as of February 19, 1999, by and among each of
the Facility Lenders and the Company, pursuant to which the Company would issue
and deliver to the Facility Lenders common stock, par value $0.001 per share, of
the Company representing approximately 93.5% of the Common Stock outstanding
after such issuance.
F. The Company has (i) terminated the Acquisition Agreement
and (ii) entered into an Asset Purchase Agreement, dated as of July 13, 1999, as
amended by Addendum No. 1 thereto, dated September 7, 1999 and a Delinquency and
Servicing Advance Purchase Agreement (collectively, the "Asset Purchase
Agreement"), between the Company and CitiFinancial Mortgage Company, a Delaware
corporation ("CMC"), pursuant to which CMC would acquire certain assets and
assume certain liabilities of the Company (the "Asset Sale").
G. The Company, the Facility Lenders and BankBoston N.A. have
previously entered into a Forbearance and Intercreditor Agreement, dated as of
October 12, 1998, amended and restated by the Amended and Restated Forbearance
and Intercreditor Agreement, dated as of February 17, 1999 between the Company
and certain of the Existing Lenders as successors in interest to BankBoston N.A.
and amended further by Amendment No. 1 to Amended and Restated Intercreditor
Agreements, dated as of March 31, 1999, and letter agreements dated as of July
15, 1999, August 11, 1999, September 14, 1999 and October 15, 1999 (as so
amended and restated, the "Original
<PAGE>
Intercreditor Agreement"). In connection with the entry by the Company into the
Asset Purchase Agreement, the Facility Lenders, the Company and the Existing
Lenders have agreed to enter into this agreement amending and restating the
Original Intercreditor Agreement (as so amended and restated, the "Agreement").
H. The Company issued a Promissory Note, dated as of July 1,
1997, in the amount of $12,975,864.30 (as amended and including any additional
Promissory Notes delivered pursuant to the Henschel Intercreditor Agreement
(defined below), the "NH Note") to Neal Henschel ("NH"), and a Promissory Note,
dated as of July 1, 1997, in the amount of $1,441,762.70 (as amended and
including any additional Promissory Notes delivered pursuant to the Henschel
Intercreditor Agreement, the "JH Note", and, together with the NH Note, the
"Notes") to Jeffrey M. Henschel ("JH", and together with NH, the "Henschels"),
pursuant to which the Company has certain unsecured payment obligations to the
Henschels (the "Henschel Note Obligations").
I. The Company, the Facility Lenders, NH and JH have entered
into an Intercreditor Agreement, dated as of the date hereof (the "Henschel
Intercreditor Agreement"), pursuant to which the Henschels have agreed not to
take certain actions specified therein and the Company has agreed to make
certain payments to amortize the Henschel Note Obligations as provided therein.
NOW THEREFORE, for good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the Company, the
Existing Lenders and the Facility Lenders agree to amend and restate the
Original Intercreditor Agreement to read in its entirety as follows:
Section 1. Standstill. (a) Each of the Facility Lenders and
the Existing Lenders agrees, subject to the terms of this Agreement, that for
the Standstill Period, it shall not:
(i) file or join in the filing of any involuntary petition in
bankruptcy with respect to the Company or its Subsidiaries, or initiate
or participate in any similar proceedings for the benefit of creditors,
including any proceeding for the appointment of a trustee, receiver,
conservator or liquidator of the Company or its Subsidiaries or any
portion of its assets;
(ii) seek to collect or enforce by litigation or otherwise,
any payment
<PAGE>
obligations under the Existing Loan Documents or the Loan Documents;
provided that nothing in this Section 1 shall prohibit the Facility
Lenders from exercising their Exchange Option;
(iii) make any Margin Calls or other demands for payment in
respect of, or additional collateral to secure the Existing
Obligations, provided, however, that this clause shall not adversely
affect the right of the Existing Lender to take any actions to
preserve, protect or perfect its liens in the Collateral;
(iv) declare a default or event of default under, or exercise
or enforce any right or remedy under, or accelerate the maturity of any
Existing Obligation or Loan under, any Existing Loan Document or Loan
Document; or
(v) seek to attach, sequester or otherwise proceed against any
of the Collateral.
(b) The Standstill Period may be terminated by the Existing
Lenders or the Facility Lenders by written notice to the Company and each other
Creditor upon the occurrence of any of the following:
(i) a failure by the Company under any Existing Loan
Agreement to make to the Existing Lender any scheduled payment of
interest, which failure continues unremedied for two days;
(ii) any intentional fraud or misrepresentation by
the Company;
(iii) immediately in the event any Other Existing
Lender takes any of the actions described in Section 1(a) of its Other
Intercreditor Agreement or either of the Henschels takes any of the
actions described in Section 1(a) of the Henschel Intercreditor
Agreement, or, in the case of the Existing Lenders, immediately in the
event any Facility Lender takes any of hte actions described in Section
1(a) of this Agreement, or, in the case of the Facility Lenders,
immediately in the event the Existing Lenders take any of the actions
described in Section 1(a) of this Agreement or either of the Henschels
takes any of the actions described in Section 1(a) of the Henschel
Intercreditor Agreement, in each case whether or not it shall have
given notice of termination of the Standstill Period;
(iv) a Change of Control or payment of the Take-Out
Premium, except to the extent payable in accordance with Section 5 of
the Other
<PAGE>
Intercreditor Agreements;
(v) an event shall occur and be continuing for a
period of ten Business Days which permits (x) any holder of
indebtedness for borrowed money of the Company or the Designated
Subsidiary outstanding (other than the Company or any Creditor or
Residential Funding Corporation) to accelerate the maturity of such
indebtedness or ( y) any holder of such indebtedness or any holder of
any guarantee or other obligation of the Company or the Designated
Subsidiary to exercise remedies with respect to property of the Company
or the Designated Subsidiary (other than the Company or Residential
Funding Corporation solely with respect to the Mortgage Loans held by
it as collateral for its existing loan), without such indebtedness
being paid or the rights of such holder to take such action being
waived, stayed or subjected to a standstill or other agreement of such
holder to forbear from exercising remedies, reasonably satisfactory to
the Creditors;
(vi) the Company shall, at any time on or after the
date of consummation of the Asset Sale, repay all or any portion of the
Loans, except any such repayment of the Loans in accordance with
Section 5 of the Other Intercreditor Agreements;
(vii) The Company shall fail to make any payment
required to be made in accordance with Section 5 or 14 or 15, as
applicable, of the Other Intercreditor Agreements;
(viii) The Company shall incur or pay any Operating
Expenses (as defined in the Other Intercreditor Agreements) or incur or
pay any obligations, except as expressly contemplated hereby or by the
Monthly Statement (as defined in the Other Intercreditor Agreements);
and
(ix) The Company shall breach the covenant set forth
in Section 8(g) or Section 5(h) of the Other Intercreditor Agreements.
(c) The Standstill Period shall terminate automatically
without notice or other action by any Creditor upon the occurrence of any of the
following:
(i) the Company or any Designated Subsidiary shall
consent to the
<PAGE>
appointment of or taking possession by a receiver, assignee,
custodian, sequestrator, trustee or liquidator (or other similar
official) of itself or of a substantial part of its property; or the
Company or any Designated Subsidiary shall admit in writing (to any
creditor, governmental authority or judicial court or tribunal) its
inability to pay its debts generally as they come due or shall fail
generally to pay its debts as they become due, or shall make a general
assignment for the benefit of its creditors; or the Company or any
Designated Subsidiary shall file a voluntary petition in bankruptcy or
a voluntary petition or answer seeking liquidation, reorganization or
other relief with respect to itself or its debts under the Federal
bankruptcy laws, as now or hereafter constituted or any other
applicable Federal or State bankruptcy, insolvency or other similar
law, or shall consent to the entry of an order for relief in an
involuntary case under any such law; or the Company or any Designated
Subsidiary shall file an answer admitting the material allegations of
a petition filed against the Company or such Designated Subsidiary in
any such proceeding, or otherwise seek relief under the provisions of
any existing or future Federal or State bankruptcy, insolvency or other
similar law providing for the reorganization or winding-up of
corporations, or providing for an arrangement, agreement,
composition, extension or adjustment with its creditors; or the
Company or any Designated Subsidiary shall take or publicly announce
its intention to take corporate action in furtherance of any of the
foregoing; or
(ii) an order, judgment or decree shall be entered in
any proceeding by any court of competent jurisdiction appointing,
without the consent of the Company, a receiver, trustee or liquidator
of the Company or any Designated Subsidiary or of any substantial part
of their respective property, or any substantial part of the property
of the Company or any Designated Subsidiary shall be sequestered, and
any such order, judgment or decree of appointment or sequestration
shall remain in force undismissed, unstayed or unvacated for a period
of 30 days after the date of entry thereof; or
(iii) an involuntary petition against the Company or
any Designated Subsidiary in a proceeding under the Federal bankruptcy
laws or other insolvency laws, as now or hereafter in effect, shall be
filed and shall not be withdrawn or dismissed within 30 days
thereafter, or a decree or order for relief in respect of the Company
or any Designated Subsidiary shall be entered by a court of competent
jurisdiction in an involuntary case under the Federal bankruptcy laws,
as now or hereafter constituted, or, under the provisions of any law
providing for reorganization or winding-up of corporations which
may apply to
<PAGE>
the Company or any Designated Subsidiary, any court of competent
jurisdiction shall assume jurisdiction, custody or control of the
Company or any Designated Subsidiary or of any substantial part of
their respective property and such jurisdiction, custody or control
shall remain in force unrelinquished, unstayed or unterminated for a
period of 30 days.
Section 2. Grant of Security Interest. In order to secure full
and timely payment of the Obligations under the Loan Agreement, and to secure
the performance of all of the other obligations of the Company under the Loan
Documents, the Company and each Subsidiary hereby mortgages, pledges and assigns
and transfers to the Facility Lenders, and grants to the Facility Lenders, a
continuing perfected security interest in, and a lien in the Collateral. The
Facility Lenders agree to release their lien in respect of any Pledged Loan,
which is sold by the Company (i) to the Existing Lenders for a purchase price
not less than the advance rate in respect of such mortgage (or, the case of any
Sixty Day Mortgage Loans or Ninety Day Mortgage Loans, at not less than 80% or
68.6% of the principal outstanding on such Mortgage Loans, respectively) in
respect of such Pledged Loan, (ii) pursuant to Section 8(f) of the Other
Intercreditor Agreements or (iii) pursuant to a securitization of Mortgage
Loans.
Section 3. Acknowledgment and Priorities. (a) The Existing
Lenders hereby acknowledge and consent to the entrance by the Company into the
Loan Documents and the granting of the lien in the Collateral granted pursuant
to Section 2; provided, however, notwithstanding anything to the contrary
contained in the Loan Agreement, the Notes or any of the Loan Documents, the
parties hereto acknowledge and agree that any security interest in or other
rights with respect to any Collateral granted to secure the Existing Obligations
under the Existing Loan Agreements or otherwise has and shall have priority, to
the extent of the Existing Obligations, over any security interest in such
Collateral granted pursuant to this Agreement, the Loan Agreement or the other
Loan Documents irrespective of:
(i) the time, order or method of attachment or perfection of
the security interest created by this Agreement, the Loan Agreement or
any Loan Document;
(ii) the time or order of filing or recording of financing
statements or other documents filed or recorded to perfect security
interests in any Collateral;
(iii) anything contained in any filing or agreement to which
the Facility
<PAGE>
Lenders, the Company, or the Collateral Agent under the Security
Agreements now or hereafter may be a party; and
(iv) the rules for determining priority under the U.C.C. or
other laws governing the relative priorities of secured creditors.
(b) The Existing Lenders hereby agree, and the Company
acknowledges, that, promptly following the expiration of 91 days after payment
in full of all the Existing Obligations hereunder, any Collateral, including any
books and records (including, without limitation, computer files, printouts and
other computer materials and records) relating to the Collateral, as well as all
proceeds and products of such Collateral, held by it shall be held for the
benefit of the Facility Lenders, provided that if such Collateral is then
subject to the prior lien of another creditor, the Existing Lenders may hold it
for the benefit of such other creditor and the Facility Lenders as their
interests may appear. If the Existing Lenders have elected not to hold such
Collateral following payment in full of the Existing Obligations, it shall
promptly forward any Collateral, including any books and records (including,
without limitation, computer files, printouts and other computer materials and
records) relating to the Collateral, as well as all proceeds and products of
such Collateral, to the Collateral Agent, provided that if such Collateral is
then subject to the prior lien of another creditor, the Existing Lenders may
forward such Collateral, proceeds and products thereof to such other creditor
or, in the event of a dispute, to such party as a court of competent
jurisdiction may direct.
(c) Nothing contained in this Agreement shall alter or impair
the Existing Lenders' rights under the Existing Loan Documents from and after
the termination of the Standstill Period in accordance herewith or be
interpreted to mean that the Existing Lenders have any obligation under the
Existing Loan Documents or otherwise to return any proceeds received on a sale
or deemed sale of any Securitization Receivables to the Company or any
Subsidiary, except as expressly provided herein.
(d) Each of the parties hereto consents to the transactions
contemplated by the Asset Purchase Agreement.
Section 4. Reserved Rights. Notwithstanding anything in this
Agreement to the contrary, but subject to Section 8 hereof, the Company and the
Facility Lenders agree that this Agreement (except as expressly provided in
Section 8) shall in no manner impair any right of the Existing Lenders or the
Facility Lenders under any Existing Loan Agreement or the Loan Agreement,
respectively, to enforce any condition precedent to any obligation it may have
thereunder to make future Advances or Facility Advances to
<PAGE>
the Company and its Subsidiaries, nor shall this Agreement limit the right of
the Existing Lenders to make Margin Calls in respect of the hedging transactions
with respect to U.S. treasury securities that the Company may have entered into
with the Existing Lenders outside of the Existing Loan Documents. All rights and
obligations of the Existing Lenders under the Existing Loan Documents to make
Advances or not make Advances and all rights of the Facility Lenders to make
Facility Advances or not make Facility Advances shall not be affected by this
Agreement, except as otherwise provided in Section 8 hereof.
Section 5. Amortization. During the Standstill Period, the
Company and the Creditors shall perform their respective obligations under
Section 5 of the Other Intercreditor Agreements.
Section 6. Conditions Precedent. The effectiveness of this
Agreement shall be subject to the condition that each of the other existing
lenders listed on Schedule I (the "Other Existing Lenders") shall have entered
into an Other Intercreditor Agreement in the form annexed hereto, and the
Company, the Facility Lenders and the Henschels shall have entered into the
Henschel Intercreditor Agreement and the Company, the Creditors and the
applicable escrow agents shall have entered into the Tax Escrow Agreement, the
NLC Escrow Agreement and the Securitization Escrow Agreement. The Company shall
furnish the Existing Lender complete and correct copies of each such Other
Intercreditor Agreement and the Henschel Intercreditor Agreement within one
business day of its execution.
Section 7. Certain Definitions.
"Advance" means any advance made by the Existing Lenders under
the Existing Loan Agreements.
"Available Cash Flow from Securitization Receivables" means
the proceeds, net of any costs of collection, to the Company or any Subsidiary
of any distribution with respect to, or prepayment of any Securitization
Receivables owned by the Company or any Subsidiary and pledged as security for,
or sold by the Company or any Subsidiary subject to an obligation to repurchase,
obligations owing to any Other Existing Lender.
"Change of Control" means the occurrence of any of the
following events
<PAGE>
(other than as a consequence of the issuance of the Preferred Stock to the
Facility Lenders upon exercise of the Exchange Option or the consummation of the
Asset Sale):
(i) the Company consummates any sale, lease, exchange
or other disposition of all or substantially all of the assets
of the Company, in any transaction or series of transactions
not in the ordinary course of business and not contemplated by
a Business Plan; or
(ii) the Company engages in a merger, consolidation
or similar business combination with any third party.
"Collateral" means (i) all of the Company's or any
Subsidiary's rights to payment of money arising out of, related to, or created
in connection with (whether such rights are classified under the applicable
Uniform Commercial Code as general intangibles, accounts, certificated
securities, uncertificated securities or otherwise): (a) all Securitization
Receivables and any other interest of the Company or any Subsidiary, in the
Securitization Transactions (other than cash paid to or for the account of the
Company in respect of the transfer by the Company or any Subsidiary of mortgage
loans to the Trustee in respect of a Securitization Transaction) and similar
rights or interests of the Company or any Subsidiary, (b) all payments to be
paid to the Company or any Subsidiary pursuant to such Securitization
Transactions (other than cash paid to or for the account of the Company in
respect of the transfer by the Company of mortgage loans to the Trustee in
respect of a Securitization Transaction) and (c) all Servicing Fees, Servicing
Rights, Servicing Advances and any similar rights or interests of the Company or
any Subsidiary in respect of any of the foregoing (a) through (c); (ii) all
business records, computer tapes, software, microfiche, or recorded data of any
kind or nature, regardless of the medium, necessary to identify, locate and
collect the foregoing; (iii) all cash from time to time deposited in any deposit
account of any of the Company or any Subsidiary with the Existing Lender, in
connection with this Agreement, including, without limitation, the Loan
Collateral Account; (iv) all other collateral described in Schedule II hereto,
including, without limitation, all accounts, inventory, equipment, general
intangibles, investment property (including the capital stock of the
Subsidiaries), (v) any other right, interest or property of the Company or any
Subsidiary now or hereafter securing the performance by the Company or any
Subsidiary of the Existing Obligations; and (vi) any and all replacements,
substitutions, distributions on or proceeds of any and all of the foregoing.
"Common Stock" means the Company's common stock, par value
$0.001 per share.
<PAGE>
"Creditor" means any of the Facility Lenders, the Existing
Lenders or any Other Existing Lender.
"Delinquent Mortgage Loan" means any Mortgage Loan which, as
of any date of determination, is more than 90 days delinquent in payment of
principal or interest due thereunder.
"Designated Subsidiary" means National Lender Center until 366
days after the date on which any remaining advances made by the Company to
National Lending Center, Inc. shall have been repaid or written off and the net
proceeds thereof paid to the escrow agent under the NLC Escrow Agreement
pursuant to Section 5(h) of the Other Intercreditor Agreements.
"Facility Advance" means any advance made by the Facility
Lenders under the Loan Agreement.
"Loan Collateral Account" means the demand deposit account
established by the Company with the Existing Lenders pursuant to the Existing
Loan Agreements for collection of the cash flow from the Collateral (other than
cash flow from Servicing Rights) and into which the Company has instructed all
relevant parties to deposit all Cash Flow from Collateral (other than cash flow
from Servicing Rights).
"Margin Call" means the right of the Existing Lenders or the
Facility Lender to give notice to require the Company to transfer to the
Existing Lenders or the Facility Lender cash or additional Collateral.
"Mortgage Loan" means any mortgage loan originated or
purchased by the Company or any Subsidiary.
"Net Proceeds of Sale of Securitization Receivables" means the
proceeds, net of any costs of sale or disposition, realized by the Company or
any Subsidiary from any sale, lease or other disposition of any Securitization
Receivables.
"Ninety Day Mortgage Loans" means Mortgage Loans financed
(including by purchase subject to a repurchase obligation) by a Creditor which
are more than 90 days delinquent on November 5, 1999.
<PAGE>
"NLC Escrow Agreement" means an escrow agreement among the
Company, each of the Creditors, and a bank acting as escrow agent, reasonably
acceptable to each Creditor, which agreement is satisfactory in form and
substance to each Creditor, providing for the deposit of the proceeds of the
warehouse financing to be provided by the Company to National Lending Center,
Inc. upon the consummation of the transactions contemplated by the Asset
Purchase Agreement into escrow thereunder.
"Other Existing Lenders" has the meaning specified in Section
6.
"Other Intercreditor Agreements" means the separate
intercreditor agreements among the Company, an Other Existing Lender and the
Facility Lenders.
"Other Residual Lenders" means the Other Existing Lenders
which are owed Residual Debt.
"Pledged Loan" means any Mortgage Loan or Wet Mortgage Loan
that is pledged by the Company or its Subsidiaries and accepted by the Existing
Lenders in connection with an Advance.
"Pledged MBS" means any residual, subordinated or interest
strip class of asset-backed security (i) issued in connection with a
securitization in which the Existing Lenders or their designee acted as lead or
co-lead underwriter or placement agent and (ii) pledged by Company and its
Subsidiaries and accepted by the Existing Lenders in connection with an Advance.
"Securitization Receivables" means all rights of the Company
or any Subsidiary to receive payments (including, without limitation, assets
classified as residual strips, certificates, or interest only strips on the
Company's financial statements) under a Securitization Transaction but excluding
rights to receive payments in respect of Servicing Fees.
"Securitization Escrow Agreement" means an escrow agreement
among the Company, each of the Creditors, and a bank acting as escrow agent,
reasonably acceptable to each Creditor, which agreement is satisfactory in form
and substance to each Creditor, providing for the deposit of the Securitization
Escrow Amount (as defined in the Other Intercreditor Agreements) upon the
consummation of the transactions contemplated by the Asset Purchase Agreement
into escrow thereunder.
<PAGE>
"Securitization Transaction" means any transaction, however
named, between the Company or any Subsidiary and any one or more purchasers
and/or investors which provides for the monetization of a discrete pool of
mortgage loans and/or mortgage notes through debt securities or ownership
interests issued by a special purpose vehicle supported or backed by mortgage
loans and/or mortgage notes that have been transferred to the special purpose
vehicle by the Company or any such Subsidiary.
"Servicing Advances" means all remittances advanced by the
Company or any Subsidiary to a Trustee under the Company's or any such
Subsidiary's servicing agreement, and the right to receive a payment of such
advances.
"Servicing Fees" means all payments arising out of, related
to, or created in connection with a Person's duties and obligations as a
servicer pursuant to the terms of a Securitization Transaction.
"Servicing Rights" means all of any Company's and any
Subsidiary's rights to payment arising out of, related to, or created in
connection with its role as servicer under any of the Securitization
Transactions or in connection with its performance of a similar role with
respect to any other transaction or arrangement.
"Seller's Guide" means the "IMC Mortgage Company Client
Operations Manual", together with the underwriting guidelines of the Company and
its Subsidiaries, a true and correct copy of which was previously provided to
the Existing Lender by the Company and its Subsidiaries.
"Sixty Day Mortgage Loans" means Mortgage Loans financed
(including by purchase subject to a repurchase obligation) by a Creditor which
are more than 60 days but not more than 90 days delinquent on November 5, 1999.
"Standstill Period" means a period ending on the first to
occur of (i) the repayment in full of all Existing Obligations, all obligations
owed to the Facility Lenders and the Henschel Note Obligations, (ii) termination
of the Standstill Period in accordance with Section 1(b) or 1(c) hereof, (iii)
termination of the Asset Purchase Agreement or (iv) December 3, 1999, if the
closing of the Asset Sale shall not have occurred by such date.
"Subsidiary" or "Subsidiaries" means those Subsidiaries which
are
<PAGE>
signatories hereto and any other entities which hereafter become a subsidiary of
the Company (or of any of the Company's Subsidiaries).
"Tax Escrow Agreement" means an escrow agreement among the
Company, each of the Creditors, and a bank acting as escrow agent, reasonably
acceptable to each Creditor, which agreement is satisfactory in form and
substance to each Creditor, providing for the deposit of the Tax Escrow Amount
(as defined in the Other Intercreditor Agreements) upon the consummation of the
transactions contemplated by the Asset Purchase Agreement into escrow
thereunder.
"Trustee" means the trustee under the trust established for
the benefit of the purchasers under a Securitization Transaction.
"Warehouse Facility" means any loan agreement, repurchase
agreement or other credit facility for the purpose of financing the purchase or
ownership of Mortgage Loans by the Company or any Subsidiary.
"Wet Mortgage Loan" means any residential mortgage loan
originated by the Company and its Subsidiaries in accordance with the Seller's
Guide, with respect to which all of the related documents required to be
delivered in connection with any Advance have not been deposited with the
custodian on or prior to the related Advance Date.
Section 8. Notice of Advances under the Loan Agreement, Etc.
(a) The Company shall not be entitled to receive, and the Existing Lenders shall
have no obligation to make any loans and advances under any of the Existing Loan
Documents.
(b) The Company shall give each Creditor prompt written notice
of any event which upon notice or lapse of time or both would constitute an
event of default in respect of any of its outstanding Debt.
(c) The Company shall give the Existing Lenders and the
Facility Lenders prompt written notice of any event that would permit
termination of the Standstill Period pursuant to Section 1(b) hereof.
(d) The Company shall give the Existing Lenders prompt written
notice of the entering into any amendment to the Asset Purchase Agreement and
the closing of the Asset Sale.
<PAGE>
(e) Until all of the Company's obligations under this
Agreement, the Other Intercreditor Agreements, the Existing Loan Documents and
the Loan Agreement have been satisfied in full, the Company shall not conduct
any business or engage in any activities other than (a) liquidating its assets
in an orderly fashion and performing its obligations under (i) the Asset
Purchase Agreement, (ii) this Agreement (including its obligations under the
Existing Loan Documents), (iii) the Other Intercreditor Agreements and the
Henschel Intercreditor Agreement and the agreements evidencing the indebtedness
owing to such other Creditors and the Henschels, (iv) the Tax Escrow Agreement,
the NLC Escrow Agreement and the Securitization Escrow Agreement, (v) any other
agreements existing on the date hereof and (v) satisfying its other obligations
and liabilities, (b) transacting any other lawful business under its certificate
of incorporation and by-laws that is incident, necessary and appropriate to
accomplish the foregoing, including defending any actions or proceedings. The
Company shall maintain not more than a commercially reasonable number of
employees necessary to conduct the foregoing activities. The Company shall not
incur any indebtedness for borrowed money other than liabilities incurred in the
ordinary course of its business (as such business is limited under the preceding
provision), and not grant any new liens (except as may be incidental to the
foregoing permitted activities).
Section 9. Acknowledgment of Obligations. The Company and each
Subsidiary acknowledges that its obligations under the Existing Loan Documents
and the liens on the Collateral securing the Existing Obligations remain in full
force and effect, that the Existing Obligations under the 1996 Agreement and the
Bridge Loan Agreement matured on October 10, 1998 and have not been paid, and
that the Company and each such Subsidiary have no defenses, counterclaims or
offsets to its obligations under the Existing Loan Documents and that such liens
are valid, perfected and enforceable. The Company and each Subsidiary hereby
waives the application of the automatic stay in any bankruptcy proceeding in
respect of the Existing Obligations and the obligations under the Loan Documents
and the Company, each Subsidiary and each Creditor consents to the modification
of the stay to permit the exercise by the Existing Lenders or the Facility
Lenders of their rights in respect of the Collateral, provided that the
foregoing shall not be construed to modify the provisions of Sections 2(b) and 3
hereof. This document shall not constitute a waiver, amendment or modification
of the Existing Loan Documents, the Existing Obligations, any defaults by the
Company under the Existing Loan Documents or the Loan Documents except to the
extent expressly provided herein and shall not be construed as a waiver or
consent to any future action on the part of the Company or any Subsidiary that
would require a waiver or consent of the Existing Lenders or the Facility
<PAGE>
Lenders, respectively, except to the extent expressly provided herein. The
Company and each Subsidiary hereby releases the Existing Lenders, their
respective officers, directors and participants from any and all claims in
respect of the Existing Loan Documents and in respect of actions taken or not
taken in connection therewith on or prior to the date of execution and delivery
hereof, excluding, however, any obligation under any agreement by such person
for the payment of money, return of property or any contractual obligations.
Effective upon the closing of the Asset Sale and the receipt by the Creditors of
the payments to be received hereunder from the proceeds of the Asset Sale, the
Existing Lenders hereby releases the executive officers and the directors of the
Company from any and all claims in respect of the Existing Loan Documents and in
respect of the actions taken or not taken in connection therewith on or prior to
the date of execution and delivery hereof, excluding, however, any obligations
under any agreement by such person for the payment of money, return of property
or any contractual obligations, and also excluding any claims in respect of
fraud or intentional misconduct.
Section 10. Amendments, Etc . No amendment, modification,
supplement, termination, consent or waiver of this Agreement or any term or
provision of this Agreement shall be effective and binding unless in writing
and signed by the Existing Lenders, the Other Existing Lenders and the Facility
Lenders. Any such waiver will be effective only in the specific instance and for
the specific purpose for which it is given.
Section 11. Severability. Any provision of this Agreement
which is illegal, invalid, prohibited or unenforceable in any jurisdiction
shall, as to such jurisdiction, be ineffective to the extent of such illegality,
invalidity, prohibition or unenforceability without invalidating or impairing
the remaining provisions hereof or affecting the validity or enforceability of
such provision in any other jurisdiction.
Section 12. WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO
HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL OR
EQUITABLE ACTION, SUIT OR PROCEEDING ARISING OUT OF OR RELATING TO THIS
AGREEMENT, OR ANY TRANSACTION CONTEMPLATED HEREBY OR THE RELATIONSHIP
ESTABLISHED HEREUNDER.
Section 13. GOVERNING LAW; VENUE AND JURISDICTION. THE
VALIDITY OF THIS AGREEMENT, THE CONSTRUCTION, INTERPRETATION AND ENFORCEMENT
HEREOF AND THE RIGHTS OF THE PARTIES HERETO SHALL BE DETERMINED UNDER, GOVERNED
BY, AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE COMMONWEALTH OF
<PAGE>
MASSACHUSETTS WITHOUT GIVING EFFECT TO CONFLICTS OF LAW PRINCIPLES THEREOF. EACH
OF THE PARTIES HERETO SUBMITS TO THE NON-EXCLUSIVE JURISDICTION OF, AND AGREES
THAT ALL ACTIONS OR PROCEEDINGS ARISING IN CONNECTION WITH THIS AGREEMENT MAY BE
TRIED AND LITIGATED IN, FEDERAL OR, IN THE ABSENCE OF FEDERAL SUBJECT MATTER
JURISDICTION, STATE COURTS LOCATED IN THE CITY OF NEW YORK, STATE OF NEW YORK
UNLESS SUCH ACTIONS OR PROCEEDINGS ARE REQUIRED TO BE BROUGHT IN ANOTHER COURT
TO OBTAIN SUBJECT MATTER JURISDICTION OVER THE MATTER IN CONTROVERSY. EACH OF
THE PARTIES WAIVES, TO THE FULLEST EXTENT PERMISSIBLE UNDER APPLICABLE LAW, ANY
RIGHT IT MAY HAVE TO ASSERT BY WAY OF MOTION, AS A DEFENSE OR OTHERWISE THE
DOCTRINE OF FORUM NON CONVENIENS OR TO OBJECT TO VENUE IN ANY PROCEEDING
BROUGHT IN ACCORDANCE WITH THE IMMEDIATELY PRECEDING SENTENCE. SERVICE OF
PROCESS, SUFFICIENT FOR PERSONAL JURISDICTION IN ANY ACTION AGAINST SUCH PARTY
MAY BE MADE BY REGISTERED OR CERTIFIED MAIL, RETURN RECEIPT REQUESTED, TO ITS
ADDRESS INDICATED IN SECTION 16.
Section 14. Expenses. In addition to the foregoing, the
Company will also reimburse the Existing Lenders and the Facility Lenders
promptly for their reasonable out-of-pocket costs and expenses incurred by such
Persons or their respective employees, agents or advisors in connection with the
performance of their respective obligations and duties hereunder and, to the
extent the Existing Loan Documents so provide, under the Existing Loan
Documents, and for any reasonable fees and expenses of legal or other
professional advisors to the Existing Lenders and the Facility Lenders engaged
in connection with the preparation and negotiation of this Agreement and review
and negotiation of all related documents, including the Asset Purchase
Agreement and the Loan Agreement, and monitoring performance of all related
documents, such reimbursement to be made, promptly and in any event within 30
days after presentation of an invoice therefor accompanied by such documentation
with respect to such costs and expenses in reasonable detail as the Company may
reasonably request. If such costs and expenses are not paid by Company within 30
days of submission, the Existing Lender may pay such costs and expenses from
Available Cash Flow from Securitization Receivables and payments on Pledged
Loans, in which event appropriate adjustments shall be made to such Existing
Lender's and each Other Residual Lender's Allocable Share of Available Cash Flow
from Securitization Receivables as if such costs and
<PAGE>
expenses were paid by the Company as Operating Expenses.
Section 15. Agreement May Constitute Financing Statement. The
Company and the Existing Lenders consent to the filing of this Agreement or a
photocopy thereof as a financing statement under the UCC as in effect in any
jurisdiction in which the Facility Lenders may determine such filing to be
necessary or desirable.
Section 16. Notices. All notices, requests and other
communications to any party hereunder shall be in writing and shall be given
to such party by facsimile transmission or by hand delivery at the following
address or facsimile number, or such other address or facsimile number as such
party may hereafter specify for the purpose by notice to the other party and
each other Creditor: (a) if to the Facility Lenders, or the Existing Lenders,
Greenwich Street Capital Partners II, L.P., c/o Greenwich Street Capital
Partners, Inc., 388 Greenwich Street, New York, New York 10013, Attn.: Sanjay
Patel; Tel: (212) 826-1149, Fax: (212) 816-0166; with a copy to Debevoise &
Plimpton, 875 Third Avenue, New York, New York 10022, Attn.: Steven Ostner, Esq.
, Tel: (212) 909-6000, Fax: (212) 909-6836; and (b) if to the Company, IMC
Mortgage Company, 5901 E. Fowler Avenue, Tampa, Florida 33617, Attn.: President,
Tel: (813) 984-2507, Fax: (813) 984-2594; with a copy to Mitchell W. Legler,
300A Wharfside Way, Jacksonville, Florida 32207 Tel: (904) 346-3200, Fax: (904)
346-3299, and if to any of the Other Existing Lenders, to such person and at the
address and facsimile number provided in Schedule III hereto. Each such notice,
request or other communication shall be effective when sent by facsimile
transmission to the facsimile number or when delivered by hand to the address
specified in this Section 16 or Schedule III hereto, provided that a facsimile
transmission shall be deemed to have been sent only so long as the transmitting
machine has provided an electronic confirmation of such transmission.
Section 17. Binding Effect; Third Party Beneficiaries. This
Agreement shall be binding upon and inure to the benefit of the parties hereto
and their successors and permitted assigns, including any successor of the
Company by merger or any entity which purchases all or substantially all of the
assets of the Company, (other than pursuant to the Asset Sale) and to each of
the other Creditors, and, as to Section 3(d) hereto, CMC, each of which is an
intended third-party beneficiary hereof. Neither the Facility Lenders nor the
Existing Lenders may sell, assign, participate or otherwise transfer or dispose
of all or any portion of the Loan or the Existing Obligations to any Person
unless such Person shall have assumed and agreed to be bound by the terms hereof
by written instrument in form reasonably satisfactory to the Company and each
other Creditor.
Section 18. Counterparts; Section Headings. This Agreement may
be
<PAGE>
executed in any number of counterparts, each of which is an original, but all of
which together constitute but one instrument. Except as otherwise indicated,
references herein to any "Section" means a "Section" of this Agreement, and
the section headings in this Agreement are for purposes of reference only and
shall not limit or define the meaning hereof.
<PAGE>
IN WITNESS WHEREOF, the parties have caused this Agreement to
be duly executed as of the date first above written.
IMC MORTGAGE COMPANY
By: /s/
--------------------------------
Name:
Title:
GREENWICH STREET CAPITAL PARTNERS II, L.P.
GSCP OFFSHORE FUND, L.P.
GREENWICH FUND, L.P.
GREENWICH STREET
EMPLOYEES FUND, L.P.
TRV EXECUTIVE FUND, L.P.
By: GREENWICH STREET
INVESTMENTS II, L.L.C.,
their General Partner
By: /s/
--------------------------------
Name:
Title:
<PAGE>
This Forbearance and Intercreditor Agreement is hereby acknowledged and agreed
to by:
IMC CORPORATION OF AMERICA
IMC CREDIT CARD, INC.
IMC MORTGAGE COMPANY CANADA, LTD.
AMERICAN HOME EQUITY CORPORATION
IMC INVESTMENT CORPORATION
IMC INVESTMENT LIMITED PARTNERSHIP
ACG FINANCIAL SERVICES (IMC), INC.
AMERICAN MORTGAGE REDUCTION, INC.
CENTRAL MONEY MORTGAGE CO. (IMC), INC.
COREWEST BANC
EQUITY MORTGAGE CO. (IMC), INC.
IMCC INTERNATIONAL, INC.
MORTGAGE AMERICA (IMC), INC.
NATIONAL LENDING CENTER, INC.
NATIONAL LENDING CENTER TILT, INC.
NATIONAL LENDING GROUP, INC.
RESIDENTIAL MORTGAGE CORPORATION (IMC), INC.
By: /s/
---------------------------------
Name:
Title:
GERMAN AMERICAN CAPITAL CORPORATION
By: /s/
---------------------------------
Name:
Title:
By: /s/
---------------------------------
Name:
Title:
<PAGE>
BEAR STEARNS HOME EQUITY TRUST
By: /s/
---------------------------------
Name:
Title:
BEAR STEARNS INTERNATIONAL LIMITED
By: /s/
---------------------------------
Name:
Title:
PAINE WEBBER REAL ESTATE SECURITIES INC.
By: /s/
---------------------------------
Name:
Title:
<PAGE>
Schedule I to the Second Amended and Restated
Forbearance and Intercreditor Agreement
Other Existing Lenders
Master Repurchase Agreement, dated as of March 29, 1996, as amended from time to
time, by and among Bear Stearns Home Equity Trust and the Company and certain of
the Company's Subsidiaries.
Master Repurchase Agreement, dated as of May 1, 1997 Between Bear, Stearns
International Limited and Industry Mortgage Company, L.P.
Institutional Account Agreement, dated October 23, 1996, between and among
Industry Mortgage Company, L.P. and Bear Stearns.
Loan and Security Agreement, dated March 17, 1998, by and among IMC Mortgage
Company, IMC Corporation of America, ACG Financial Services (IMC), Inc.,
American Mortgage Reduction, Inc., Central Money Mortgage Co. (IMC), Inc.,
Corewest Banc, Equity Mortgage Co., (IMC), Inc., Mortgage America (IMC), Inc.,
National Lending Center, Inc., National Lending Center TILT, Inc, and
Residential Mortgage Corporation (IMC), Inc., as borrowers, and German American
Capital Corporation, as lender.
Loan and Security Agreement, dated March 17, 1998, by and among IMC Mortgage
Company, IMC Corporation of America, ACG Financial Services (IMC), Inc.,
American Mortgage Reduction, Inc., Central Money Mortgage Co. (IMC), Inc.,
Corewest Banc, Equity Mortgage Co., (IMC), Inc., Mortgage America (IMC), Inc.,
National Lending Center, Inc., National Lending Center TILT, Inc, and
Residential Mortgage Corporation (IMC), Inc., as borrowers, and German American
Capital Corporation, as successor by assignment to Aspen Funding Corp., as
lender
Loan and Security Agreement, dated as of February 28, 1997, between IMC Mortgage
Company, IMC Corporation of America, ACG Financial Services (IMC), Inc.,
American Mortgage Reduction, Inc., Industry Mortgage Company, L.P., Corewest
Banc, IMC Investment Corp., and IMC Investment Limited Partnership, as
borrowers, and Paine Webber Real Estate Securities, Inc., as lender.
<PAGE>
Schedule II to the Second Amended and Restated
Forbearance and Intercreditor Agreement
Additional Collateral
All of the collateral granted under the following agreements:
1. Bridge Loan and Security Agreement, dated as of October 10,
1997, as amended from time to time by and among the Company,
certain of its Subsidiaries and BankBoston, N.A.;
2. Loan and Security Agreement, dated December 31, 1996, as
amended from time to time by and among the Company, certain of
its Subsidiaries and BankBoston, N.A.;
3. Loan Agreement, dated October 15, 1998, by and among the
Company, certain of its Subsidiaries and BankBoston, N.A. ;
4. Pledge and Security Agreement, dated October 14, 1998, between
the Company and BankBoston, N.A.;
5. Stock Pledge Agreement, made as of December 31, 1997, by and
between the Company and BankBoston, N.A., as amended by the
First Amendment to Stock Pledge Agreement, dated October __,
1998; and
6. Security Agreement, made October 10, 1997, by the Company and
certain of its Subsidiaries in favor of BankBoston, N.A., as
amended by the First Amendment to Security Agreement made
October __, 1998, between BankBoston, N.A., the Company and
certain of its Subsidiaries.
<PAGE>
Schedule III to the Second Amended and Restated
Forbearance and Intercreditor Agreement
Notice Address for Other Existing Lenders
Bear, Stearns & Co., Inc.
if to Bear, Stearns: Bear Stearns & Co. Inc., 245 Park Avenue, New York, New
York 10167, Attn: Philip M. Cedar, Tel.: (212) 272-6768, Fax: (212) 272-4933 and
Paul Friedman, Tel.: (212) 272-3516, Fax: (212) 272-6550, with a copy to;
Cadwalader, Wickersham & Taft, 100 Maiden Lane, New York, New York 10038, Attn.
Barry J. Dichter, Esq., Tel.: (212) 504-6000, Fax: (212) 504-6666;
Deutsche Lenders
if to German American Corporation, to: German American Capital Corporation, 31
West 52nd Street, New York, New York 10019, Attn.: Vijay Radhakishun, Tel.:
(212) 469-8925, Fax: (212) 469-5923, with a copy to: Deutsche Bank A.G., as
agent, 31 West 52nd Street, New York, New York 10019, Attn.: Greg Amoroso, Tel.:
(212) 469-3987, Fax: (212) 469-5160, and Richard Uhlig, Tel.: (212) 469-7730,
Fax: (212) 469-5103; and in either case described in clause (i) or (ii) above;
with a copy to Cadwalader, Wickersham & Taft, 100 Maiden Lane, New York, New
York 10038, Attn.: Karen Gelernt, Esq., Tel: (212) 504-6000, Fax: (212) 504-6666
Paine Webber
if to Paine Webber, to: PaineWebber Real Estate Securities, Inc., 1285 Avenue of
the Americas, New York, New York 10019, Attn.: George Mangiaracina, Tel: (212)
713-3734, Fax: (212) 265-3881; with a copy to Cadwalader, Wickersham & Taft, 100
Maiden Lane, New York, New York 10038, Attn.: Michael S. Gambro, Esq., Tel:
(212) 504-6825; Fax: (212) 504-6666
Exhibit 10.85
INTERCREDITOR AGREEMENT
(Henschels)
INTERCREDITOR AGREEMENT, dated as of November 10, 1999 (the
"Agreement"), between IMC MORTGAGE COMPANY, a Florida corporation (the
"Company"), GREENWICH STREET CAPITAL PARTNERS II, L.P., a Delaware limited
partnership ("GSCP"), GREENWICH FUND, L.P., a Delaware limited partnership, GSCP
OFFSHORE FUND, L.P., a Cayman Islands exempted limited partnership, GREENWICH
STREET EMPLOYEES FUND, L.P., a Delaware limited partnership, TRV EXECUTIVE FUND,
L.P., a Delaware limited partnership (each, including GSCP, a "Facility Lender"
and collectively, the "Facility Lenders"), NEAL HENSCHEL ("NH") and Jeffrey M.
Henschel ("JH", and together with NH, the "Henschels").
RECITALS
A. The Company has entered into a Loan Agreement, dated as of
October 12, 1998, amended by Amendment No. 1 thereto, dated as of February 11,
1999 (as the same may be further modified, supplemented or restated from time to
time, the "Loan Agreement"), between the Company, as borrower, and the Facility
Lenders, pursuant to which the Facility Lenders have extended to the Company
loans in the aggregate principal amount of $38,000,000 (the "Loans"), subject to
the terms and conditions set forth in the Loan Agreement, which Loans are
evidenced by notes and entitled to the benefit of certain guarantees and
security provided under certain other documents related to such Loans.
B. The Facility Lenders have succeeded by assignment to the
Company's debt obligations to BankBoston N.A. (together with the Loans, the
"Facility Lender Obligations").
C. The Facility Lenders have made certain additional loans to
the Company pursuant to Note Purchase and Amendment Agreement No. 6, dated as of
October 18, 1999, in the original principal amount of $61,500,000 (the "Facility
Lender Advances"), to fund certain monthly delinquent interest servicing
advances in respect of the Company's securitizations.
D. The Company issued a Promissory Note, dated as of July 1,
1997, in the amount of $12,975,864.30 (as amended and including any additional
Promissory Notes delivered pursuant to Section 7 hereof, the "NH Note") to NH,
and a Promissory
<PAGE>
Note, dated as of July 1, 1997, in the amount of $1,441,762.70 (as amended and
including any additional Promissory Notes delivered pursuant to Section 7
hereof, the "JH Note", and, together with the NH Note, the "Notes") to JH,
pursuant to which the Company has certain unsecured payment obligations to the
Henschels (the "Note Obligations").
E. The Company has entered into an Asset Purchase Agreement,
dated as of July 13, 1999, as amended by Amendment No. 1 thereto, dated
September 7, 1999 and a Delinquency and Servicing Advance Purchase Agreement,
dated November _, 1999 (collectively, the "Asset Purchase Agreement"), between
the Company and CitiFinancial Mortgage Company, a Delaware corporation ("CMC"),
pursuant to which CMC would acquire certain assets and assume certain
liabilities of the Company (the "Asset Sale").
NOW THEREFORE, for good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the Company, the
Henschels and the Facility Lenders agree as follows:
Section 1. Standstill. (a) The Henschels agree, subject to the
terms of this Agreement, that for the Standstill Period, they shall not:
(i) file or join in the filing of any involuntary petition in
bankruptcy with respect to the Company or its subsidiaries, or initiate
or participate in any similar proceedings for the benefit of creditors,
including any proceeding for the appointment of a trustee, receiver,
conservator or liquidator of the Company or its subsidiaries or any
portion of its assets;
(ii) seek to collect or enforce by litigation or otherwise,
the Note Obligations;
(iii) make any demands for payment in respect of, or
collateral to secure, the Notes or the Note Obligations;
(iv) declare a default or event of default under, or exercise
or enforce any right or remedy under, or accelerate the maturity of the
Notes or any Note Obligation; or
(v) seek to attach, sequester or otherwise proceed against any
of the assets of the Company.
(b) The Standstill Period may be terminated by the Henschels
by written notice to the Company, the Facility Lenders and each of the other
creditors listed on
<PAGE>
Schedule I hereto who currently hold security interests in assets of the Company
(the "Other Secured Creditors") at the notice addresses set forth on Schedule I
hereto upon the occurrence of any of the following:
(i) a failure by the Company to make to the Henschels
any required payment in respect of the Notes when due pursuant to
Section 7 hereof, or a failure by the Company to make payments to the
Facility Lenders in accordance with the terms of the Other
Intercreditor Agreements (as defined below), in each case, which
failure continues unremedied for five days;
(ii) any intentional fraud or misrepresentation by
the Company;
(iii) immediately in the event the Facility Lenders
or any of the Other Secured Creditors takes any of the actions
described in Section 1(a) of the Other Intercreditor Agreements or
terminates the "standstill period" (as such term is defined in each
Other Intercreditor Agreement) pursuant to Section 1(b) of any Other
Intercreditor Agreement, in each case whether or not it shall have
given notice of termination of the standstill period;
(c) The Standstill Period shall terminate automatically
without notice or other action by any the Henschels or the Facility Lenders upon
the occurrence of any of the following:
(i) the Company shall consent to the appointment of
or taking possession by a receiver, assignee, custodian,
sequestrator, trustee or liquidator (or other similar official) of
itself or of a substantial part of its property; or the Company shall
admit in writing (to any creditor, governmental authority or judicial
court or tribunal) its inability to pay its debts generally as they
come due or shall fail generally to pay its debts as they become due,
or shall make a general assignment for the benefit of its creditors; or
the Company shall file a voluntary petition in bankruptcy or a
voluntary petition or answer seeking liquidation, reorganization or
other relief with respect to itself or its debts under the Federal
bankruptcy laws, as now or hereafter constituted or any other
applicable Federal or State bankruptcy, insolvency or other similar
law, or shall consent to the entry of an order for relief in an
involuntary case under any such law; or the Company shall file an
answer admitting the material allegations of a petition filed against
the Company in any such proceeding, or otherwise seek relief under
the provisions of any existing or future Federal or State bankruptcy,
insolvency or other similar law providing for the reorganization or
winding-up of corporations, or providing for an arrangement,
agreement, composition, extension or adjustment
<PAGE>
with its creditors; or the Company shall take or publicly announce its
intention to take corporate action in furtherance of any of the
foregoing; or
(ii) an order, judgment or decree shall be entered in
any proceeding by any court of competent jurisdiction appointing,
without the consent of the Company, a receiver, trustee or liquidator
of the Company or of any substantial part of its property, or any
substantial part of the property of the Company shall be sequestered,
and any such order, judgment or decree of appointment or sequestration
shall remain in force undismissed, unstayed or unvacated for a period
of 30 days after the date of entry thereof; or
(iii) an involuntary petition against the Company in
a proceeding under the Federal bankruptcy laws or other insolvency
laws, as now or hereafter in effect, shall be filed and shall not be
withdrawn or dismissed within 30 days thereafter, or a decree or order
for relief in respect of the Company shall be entered by a court of
competent jurisdiction in an involuntary case under the Federal
bankruptcy laws, as now or hereafter constituted, or, under the
provisions of any law providing for reorganization or winding-up of
corporations which may apply to the Company, any court of competent
jurisdiction shall assume jurisdiction, custody or control of the
Company or of any substantial part of its property and such
jurisdiction, custody or control shall remain in force
unrelinquished, unstayed or unterminated for a period of 30 days.
Section 2. Subordination. (a) Subject to the other terms and
conditions of this Agreement, including, without limitation, those set forth in
Section 7, from and until the expiration of the Standstill Period, the Henschels
hereby subordinate any and all claims now or hereafter owing to them by the
Company under the Notes to any and all claims of the Facility Lenders and the
Other Secured Creditors pursuant to any obligation for borrowed money of, or
agreement to lend money to, (or any purchase obligation under a repurchase
agreement of) the Company, including, without limitation, interest or other
payments paid or accrued after the commencement of any Insolvency Proceeding
(the "Obligations"), and payment of or for adequate protection pursuant to any
Insolvency Proceeding.
(b) Except as set forth in this paragraph (b) and Section 19
hereof, from and until the expiration of the Standstill Period, the Henschels
agree not to accept any
<PAGE>
payment of the Note Obligations nor make any transfer to third parties not party
to this Agreement or take any other action designed to secure directly or
indirectly from the Company or any other person or entity any payment on account
of the Note Obligations, without the express, prior written agreement of the
Facility Lenders, and, except as set forth below in this paragraph (b), the
Henschels agree to pay over to the Facility Lenders any funds that may be
received by them from the Company as a payment on account of the Note
Obligations. Notwithstanding the foregoing, the Henschels shall be entitled to
receive and retain their share of any payment made in accordance with Section 7
hereof.
(c) Except as otherwise expressly provided in Section 7 hereof
and to the extent the same resulted from a payment arising during any period for
which the Note Obligations are subordinated pursuant to subsection (a) hereof,
in the event of any payment, distribution, division or application, partial or
complete, voluntary or involuntary, by operation of law or otherwise, of all or
any part of the property, assets or business of the Company or any of its
subsidiaries, or the proceeds thereof, or any securities of the Company, to the
Henschels, by reason of any liquidation, dissolution or other winding up of the
Company or its business or by reason of any sale or any insolvency,
receivership, bankruptcy, dissolution, liquidation, or reorganization
proceeding, or in any other proceeding, whether voluntary or involuntary, by or
against the Company, under any bankruptcy or insolvency law or laws, Federal or
state, relating to the relief of debtors of any jurisdiction, whether now or
hereafter in effect, and in any out-of-court composition, assignment for the
benefit of any creditor, readjustment of indebtedness, reorganization, extension
or other debt arrangement of any kind (collectively, "Insolvency Proceeding"),
then any such payment or distribution of any kind or character, whether in cash,
property or securities, which, but for the subordination provisions of this
Section 2, would otherwise be payable or deliverable upon or in respect of the
Note Obligations, shall instead be paid over or delivered directly to the
Facility Lenders, for application to the payment of the Obligations, to the
extent necessary to make payment of the Obligations remaining unpaid after
giving effect to any concurrent payment or distribution to the Facility Lenders.
(d) Nothing contained in this Agreement shall alter or impair
the Henschels' rights under the Notes or the Note Obligations from and after the
termination of the Standstill Period in accordance herewith or be interpreted to
mean that the Henschels have any obligation under the Notes or the Note
Obligations or otherwise to return any proceeds received in respect of the Notes
or the Note Obligations to the Company or any subsidiary of the Company, except
as expressly provided herein.
Section 3. Turnover of Prohibited Transfers. If any payment,
distribution or security, or the proceeds thereof, are received by the Henschels
on account of or with
<PAGE>
respect to any of the Note Obligations other than as expressly permitted herein,
the Henschels shall forthwith deliver same to the Facility Lenders in the form
received (except for the addition of any endorsement or assignment necessary to
effect a transfer of all rights therein to the Facility Lenders) for application
to the Obligations or, at the Facility Lenders' option, the Henschels shall pay
to the Facility Lenders the amount thereof on demand. The Facility Lenders are
irrevocably authorized to supply any required endorsement or assignment which
may have been omitted. Until so delivered, any such payment, distribution or
security shall be held by the Henschels in trust for the Facility Lenders, and,
if the Henschels knew or reasonably should have known that any such receipts
should be held in trust pursuant hereto, shall not be commingled with other
funds or property of the Henschels, and upon request the Henschels promptly
shall pay such funds over to the Facility Lenders pursuant to the first sentence
of this Section 3.
Section 4. Waiver of Marshaling. The Henschels agree that the
Facility Lenders shall have no obligation to marshal any part of the assets of
the Company or any other property, instruments, documents, agreements or
guaranties before enforcing their rights against any assets of the Company.
Accordingly, the parties hereto agree that the Facility Lenders may liquidate
the assets of the Company in any order in their sole discretion.
Section 5. No Contest of Security Interests. During the
Standstill Period, the Henschels shall not contest the validity, perfection or
enforceability of any security interest granted to the Facility Lenders or the
Other Secured Creditors by (or any purchase subject to a repurchase obligation
of) the Company, or any payment on the Obligations or the allowance of the
Obligations as a senior secured claim, and the Henschels agree to cooperate in
the defense of any action contesting the validity, perfection or enforceability
of such liens or security interests or such payment or allowance. Nothing in
this Agreement shall be construed as in any way limiting a party's right to
enforce the order of priorities of debts set forth herein as against any other
person or entity.
Section 6. Subordination Not Affected, Etc. Nothing in this
Agreement shall be construed as affecting or in any way limiting the extension
of any new or additional financial accommodation by the Facility Lenders and the
Other Secured Creditors to the Company and the terms and conditions hereof shall
apply to such new and additional financial accommodations. Notwithstanding the
preceding sentence or
<PAGE>
anything contained in this Agreement to the contrary, none of the provisions of
this Agreement shall be deemed or construed to constitute a commitment or an
obligation on the part of the Facility Lenders or any Other Secured Creditors to
make any future loans, advances or other extensions of credit or financial
accommodation to the Company. The Henschels understand and agree that all
accrued interest, charges, expenses, attorneys' fees and other liabilities and
obligations under the Loan Agreement and related documents and any agreement of
the Company to borrow money from the Other Secured Creditors shall constitute
part of the Obligations, and nothing in this Agreement shall be construed as
affecting or in any way limiting any indulgence granted by the Facility Lenders
or any Other Secured Creditors with respect to any existing financial
accommodation to the Company. The subordinations effected hereby shall not be
affected by (a) any amendment of or any addition of or supplement to any
instrument, document or agreement relating to the Obligations, (b) any exercise
or non-exercise of any right, power or remedy under or in respect of the
Obligations or any instrument, document or agreement relating thereto, (c) the
release, sale, exchange or surrender, in whole or in part, of any part of any
collateral (or of property subject to repurchase obligation) to which the
Facility Lenders or any Other Secured Creditors may become entitled, (d) any
waiver, consent, release, indulgence, extension, renewal, modification, delay or
other action, inaction or omission in respect of the Obligations or any
instrument, document or agreement relating thereto or any security therefor or
pledge or guaranty thereof, whether or not the Henschels shall have had notice
or knowledge of any of the foregoing and regardless of whether the Henschels
shall have consented or objected thereto. Any provision of any document,
instrument or agreement evidencing, or otherwise relating to the Note
Obligations purporting to limit or restrict in any way the Company's ability to
enter into any agreement with the Facility Lenders and the Other Secured
Creditors to amend or modify any document, instrument or agreement evidencing,
securing or otherwise relating to the Obligations shall be deemed of no force or
effect.
Section 7. Principal and Interest Payments. (a) Upon
consummation of the Asset Sale and simultaneously upon payment by the Company to
the Facility Lenders of such monies other than Excepted Proceeds, the Facility
Lenders shall pay to the Henschels 10% of the first $7.5 million of the Facility
Lender Asset Sale Proceeds and 5% of the Facility Lender Asset Sale Proceeds in
excess of $7.5 million up to a maximum aggregate amount to be paid to the
Henschels hereunder of $1.25 million; provided that the Facility Lenders shall
pay Henschels not less than $600,000 from the Facility Lender Asset Sale
Proceeds (the "Minimum Payment"), in each case to be applied first to repayment
of any accrued and unpaid interest owed to the Henschels on the Note Obligations
and then to the principal of the Note Obligations under the Notes.
<PAGE>
(b) The Notes are hereby amended so that the Company shall pay
monthly in arrears on the first business day of each month, commencing December
1, 1999, interest at the rate of 10% per annum on the then outstanding principal
balance (including interest which has been capitalized) due under the Notes. As
of the date hereof, prior to the capitalization of interest and expenses, the
outstanding principal balance under the NH Note is $11,615,221.80 and under the
JH Note is $1,290,580.20. As of November 12, 1999, the outstanding accrued and
unpaid interest under the NH Note equals $177,081.28 and under the JH Note
equals $19,675.70 which interest shall be capitalized as of November 12, 1999.
As of November 12, 1999, the outstanding expenses related to the NH Note are
$150,750.00 and related to the JH Note are $16,750.00 which expenses shall be
capitalized as of the date hereof. As of November 12, 1999, including the
capitalization of interest and expenses, the outstanding principal balance under
the NH Note equals $11,943,053.08 and under the JH Note equals $1,327,005.90.
All accrued and unpaid interest and capitalized expenses shall be payable in
kind by delivery of additional Notes, and any interest so paid in kind shall
then be considered outstanding principal due under the Notes for all purposes
herein.
(c) Until such time as the Note Obligations shall have been
paid in full and simultaneously upon payment by the Company to the Facility
Lenders of such monies other than Excepted Proceeds, the Facility Lenders shall
pay to the Henschels the following amounts: (i) 3% of all Facility Lender
Residual Proceeds until such time as total Facility Lender Receipts equal $104
million; (ii) 7.5% of all Facility Lender Residual Proceeds during such time as
total Facility Lender Receipts are between $104 million and $144 million; and
(iii) 20% of all Facility Lender Residual Proceeds after such time as total
Facility Lender Receipts are in excess of $144 million. All such payments to the
Henschels shall be applied first to accrued and unpaid interest owed to the
Henschels on the Note Obligations and then to repayment of principal on the Note
Obligations under the Notes.
(d) The Company shall not sell any Residuals unless,
contemporaneously with such sale, the Company shall make any payment to the
Facility Lenders that is contemplated by the Other Intercreditor Agreements, and
simultaneously with any such payment from the Company, the Facility Lenders
shall make payment on the Note Obligations in respect of the Facility Lender
Residual Proceeds generated by the sale of such Residuals as required by Section
7(b) and 7(c) above. In addition, the Facility Lenders agree that they shall not
cause or permit to occur a sale of Residuals to themselves or any of their
affiliates for a purchase price equal to less than the fair market value of such
Residuals. For purposes of the preceding sentence only, the fair market value of
such Residuals may be determined by third party bids for such Residuals or by an
independent appraisal.
<PAGE>
(e) Upon reasonable request of the Henschels, the Facility
Lenders will provide the Henschels with information as to the amount of Excepted
Proceeds due to them at such time. The Company shall provide to the Henschels
the Monthly Statement (as such term is defined in the Other Intercreditor
Agreements) and any other information that the Company provides to the Other
Secured Creditors.
(f) The Company or the Facility Lenders shall pay amounts due
pursuant to this Agreement to each of NH or JH as notified in writing in advance
by either NH or JH, such notification to be conclusive and binding on both NH
and JH regardless of whether NH or JH provides such notice.
Section 8. Certain Definitions.
"Asset Sale" has the meaning specified in the recitals.
"Common Stock" means the Company's common stock, par value
$0.001 per share.
"Company" has the meaning specified in the recitals.
"Excepted Proceeds" means any payments received by the
Facility Lenders in respect of (i) principal and accrued interest with respect
to Facility Lender Advances, (ii) Expense Reimbursements, (iii) Surety Bond
Payments or (iv) the Henschel Make-up Amount.
"Expense Reimbursements" means any payments received by the
Facility Lenders in respect of (i) the payment or reimbursement from time to
time of expenses, including reasonable attorneys' fees and disbursements,
payable to the Facility Lenders pursuant to the Facility Lender Obligations as
in effect on the date hereof, and (ii) a $1,000,000 fee to be paid to the
Facility Lenders out of the proceeds of the Asset Sale.
"Facility Lender Advances" has the meaning specified in the
recitals.
"Facility Lender Asset Sale Proceeds" means any proceeds from
the Asset Sale paid to the Facility Lenders, except for the Excepted Proceeds,
for application to payment of the Facility Lender Obligations and the Note
Obligations as contemplated by
<PAGE>
the Other Intercreditor Agreements; for the avoidance of doubt, Facility Lender
Asset Sale Proceeds shall include any distributions to the Facility Lenders
pursuant to the Securitization Escrow Agreement, the Tax Escrow Agreement or the
NLC Escrow Agreement (as such terms are defined in the Other Intercreditor
Agreements).
"Facility Lender Receipts" means the amount paid to the
Facility Lenders in respect of the Facility Lender Asset Sale Proceeds or the
Facility Lender Residual Proceeds.
"Facility Lender Residual Proceeds" means all proceeds of
distribution on or liquidation of Residuals and other assets of the Company or
other monies paid to the Facility Lenders pursuant to the Other Intercreditor
Agreements or otherwise, except in each case for the Excepted Proceeds, and
excluding any Facility Lender Asset Sale Proceeds.
"Facility Lenders" has the meaning specified in the recitals.
"Henschel Make-up Amount" shall mean an amount equal to the
product of (i) 75% and (ii) the excess if any of (A) $600,000 over (B) the
amount the Henschels would have received pursuant to Section 7(a) hereof if the
Facility Lenders had no obligation to pay the Minimum Payment.
"Insolvency Proceeding" has the meaning specified in Section
2(c).
"Obligations" has the meaning specified in Section 2(a).
"Other Intercreditor Agreements" means, collectively: (i) the
Second Amended and Restated Intercreditor Agreement, dated as of November 10,
1999, between the Company, the Facility Lenders and Paine Webber Real Estate
Securities Inc.; (ii) the Second Amended and Restated Intercreditor Agreement,
dated as of November 10, 1999, between the Company, the Facility Lenders, Bear
Stearns Home Equity Trust, Bear, Stearns International Limited and certain other
parties enumerated therein; and (iii) the Second Amended and Restated
Intercreditor Agreement, dated as of November 10, 1999, between the Company, the
Facility Lenders and German American Capital Corporation.
"Residual" means any residual, subordinated or interest strip
class of asset-backed security (i) issued in connection with a securitization in
which any creditor of the Company or its designee acted as lead or co-lead
underwriter or placement agent and (ii) pledged or sold, subject to repurchase
obligation, by the Company and its
<PAGE>
subsidiaries and accepted by such creditor in connection with the financing of
such security.
"Standstill Period" means a period ending on the first to
occur of (i) the repayment in full of all Note Obligations, or (ii) termination
of the Standstill Period in accordance with Section 1(b) hereof.
"Surety Bond Payments" means any payments pursuant to the
Reimbursement Agreement, dated as of May 20, 1999 (as the same may be amended,
the "Reimbursement Agreement"), among the Company, and GSCP, providing for
reimbursement of amounts paid pursuant to certain indemnification obligations
undertaken by GSCP in favor of issuers of surety bonds issued on behalf of the
Company and its subsidiaries.
Section 9. Acknowledgment of Obligations. The Company
acknowledges that its obligations under the Notes and the Note Obligations
remain in full force and effect, and that the Company has no defenses,
counterclaims or offsets to its obligations under the Notes and the Note
Obligations. The Company hereby waives the application of the automatic stay in
any bankruptcy proceeding in respect of the Notes and the Note Obligations
provided that the foregoing shall not be construed to modify the provisions of
Sections 2 hereof. This document shall not constitute a waiver, amendment or
modification of the Notes and the Note Obligations except as expressly provided
herein and shall not be construed as a waiver or consent to any future action on
the part of the Company that would require a waiver or consent of the Henschels
or the Facility Lenders, respectively, except to the extent expressly provided
herein. The Company and each subsidiary hereby releases the Henschels, their
respective officers, directors and participants from any and all claims in
respect of the Notes and in respect of actions taken or not taken in connection
therewith on or prior to the date of execution and delivery hereof, excluding,
however, any obligation under any agreement by such person for the payment of
money, return of property or any contractual obligations. Effective upon the
closing of the Asset Sale and the receipt by the Henschels of the payments to be
received hereunder from the proceeds of the Asset Sale, the Henschels hereby
releases the executive officers and the directors of the Company from any and
all claims in respect of the Notes and in respect of the actions taken or not
taken in connection therewith on or prior to the date of execution and delivery
hereof, excluding, however, any obligations under any agreement by such person
for the payment of money, return of property or any
<PAGE>
contractual obligations, and also excluding any claims in respect of fraud or
intentional misconduct.
Section 10. Notices (a) The Company shall give the Henschels
and the Facility Lenders prompt written notice of any event that would permit
termination of the Standstill Period pursuant to Section 1(b) hereof.
(b) The Company shall give the Henschels prompt written notice
of the consummation of the Asset Sale and any amendment of the Reimbursement
Agreement.
Section 11. Waiver of Stay. The Company hereby waives the
application of the automatic stay in any bankruptcy proceeding in respect of the
obligations under the Loan Agreement, and the Company and each creditor consents
to the modification of the stay to permit the exercise by the Facility Lenders,
the Other Secured Creditors or the Henschels of their rights in respect of the
assets of the Company, provided that the foregoing shall not be construed to
modify the provisions of Sections 2 to 6 hereof.
Section 12. Amendments, Etc. No amendment, modification,
supplement, termination, consent or waiver of this Agreement or any term or
provision of this Agreement shall be effective and binding unless in writing and
signed by the Henschels, the Company, Facility Lenders and the Other Secured
Creditors. Any such waiver will be effective only in the specific instance and
for the specific purpose for which it is given.
Section 13. Severability. Any provision of this Agreement
which is illegal, invalid, prohibited or unenforceable in any jurisdiction
shall, as to such jurisdiction, be ineffective to the extent of such illegality,
invalidity, prohibition or unenforceability without invalidating or impairing
the remaining provisions hereof or affecting the validity or enforceability of
such provision in any other jurisdiction.
Section 14. WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO
HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL OR
EQUITABLE ACTION, SUIT OR PROCEEDING ARISING OUT OF OR RELATING TO THIS
AGREEMENT, OR ANY TRANSACTION CONTEMPLATED HEREBY OR THE RELATIONSHIP
ESTABLISHED HEREUNDER.
<PAGE>
Section 15. GOVERNING LAW; VENUE AND JURISDICTION. THE
VALIDITY OF THIS AGREEMENT, THE CONSTRUCTION, INTERPRETATION AND ENFORCEMENT
HEREOF AND THE RIGHTS OF THE PARTIES HERETO SHALL BE DETERMINED UNDER, GOVERNED
BY, AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK
WITHOUT GIVING EFFECT TO CONFLICTS OF LAW PRINCIPLES THEREOF. EACH OF THE
PARTIES HERETO SUBMITS TO THE NON-EXCLUSIVE JURISDICTION OF, AND AGREES THAT ALL
ACTIONS OR PROCEEDINGS ARISING IN CONNECTION WITH THIS AGREEMENT MAY BE TRIED
AND LITIGATED IN FEDERAL OR, IN THE ABSENCE OF FEDERAL SUBJECT MATTER
JURISDICTION, STATE COURTS LOCATED IN THE COUNTY OF NEW YORK, STATE OF NEW YORK
UNLESS SUCH ACTIONS OR PROCEEDINGS ARE REQUIRED TO BE BROUGHT IN ANOTHER COURT
TO OBTAIN SUBJECT MATTER JURISDICTION OVER THE MATTER IN CONTROVERSY. EACH OF
THE PARTIES WAIVES, TO THE FULLEST EXTENT PERMISSIBLE UNDER APPLICABLE LAW, ANY
RIGHT IT MAY HAVE TO ASSERT BY WAY OF MOTION, AS A DEFENSE OR OTHERWISE THE
DOCTRINE OF FORUM NON CONVENIENS OR TO OBJECT TO VENUE IN ANY PROCEEDING
BROUGHT IN ACCORDANCE WITH THE IMMEDIATELY PRECEDING SENTENCE. SERVICE OF
PROCESS SUFFICIENT FOR PERSONAL JURISDICTION IN ANY ACTION AGAINST SUCH PARTY
MAY BE MADE BY REGISTERED OR CERTIFIED MAIL, RETURN RECEIPT REQUESTED, TO ITS
ADDRESS INDICATED IN SECTION 16.
Section 16. Notices. All notices, requests and other
communications to any party hereunder shall be in writing and shall be given
to such party by facsimile transmission or by hand delivery at the following
address or facsimile number, or such other address or facsimile number as such
party may hereafter specify for the purpose by notice to each other party. (a)
If to the Facility Lenders, Greenwich Street Capital Partners II, L.P., c/o
Greenwich Street Capital Partners, Inc., 388 Greenwich Street, New York, New
York 10013, Attn.: Sanjay Patel; Tel: (212) 826-1149, Fax: (212) 816-0166; with
a copy to Debevoise & Plimpton, 875 Third Avenue, New York, New York 10022,
Attn.: Steven Ostner, Esq., Tel: (212) 909-6000, Fax: (212) 909-6836; (b) if to
the Company, IMC Mortgage Company, 5901 E. Fowler Avenue, Tampa, Florida 33617,
Attn.: President, Tel: (813) 984-2533, Fax: (813) 984-2593; with a copy to
Mitchell W. Legler, 300A Wharfside Way, Jacksonville, Florida 32207; and (c) and
if to the Henschels: 700 West Hillsboro Boulevard, Building One, Suite 204,
Deerfield Park, FL 33441, Tel.: (800) 950-3314 ext. 1101, Fax: (954) 420-5470;
with a copy to Akin, Gump, Strauss, Hauer & Feld, L.L.P., 590 Madison Avenue,
20th Floor, New York, New York 10022, Attn.: Steven M. Pesner, P.C., Tel: (212)
407-3070; Fax: (212) 872-1002. Each
<PAGE>
such notice, request or other communication shall be effective when sent by
facsimile transmission to the facsimile number or when delivered by hand to the
address specified in this Section, provided that a facsimile transmission
shall be deemed to have been sent only so long as the transmitting machine has
provided an electronic confirmation of such transmission.
Section 17. Binding Effect; Third Party Beneficiaries. This
Agreement shall be binding upon and inure to the benefit of the parties hereto
and their successors and permitted assigns, including any successor of the
Company by merger or any entity which purchases all or substantially all of the
assets of the Company (other than pursuant to the Asset Sale), and, solely in
respect to Section 12 hereof, to each of the Other Secured Creditors, each of
which (in respect of such Section 12 hereof) is an intended third-party
beneficiary hereof.
Section 18. Counterparts; Section Headings. This Agreement may
be executed in any number of counterparts, each of which is an original, but all
of which together constitute but one instrument. Except as otherwise indicated,
references herein to any "Section" means a "Section" of this Agreement, and
the section headings in this Agreement are for purposes of reference only and
shall not limit or define the meaning hereof.
Section 19. Assignment. The Henschels may sell, assign,
participate or otherwise transfer or dispose of all or any portion of the Notes
or the Note Obligations to any person or entity, subject to the prior written
consent of the Facility Lenders (the "Facility Lender Consent"), which consent
shall not be unreasonably withheld, and provided that any such person or entity
shall have assumed and agreed to be bound by the terms hereof by written
instrument in form reasonably satisfactory to the Company and the Facility
Lenders; provided further that, in the case of any transfer to an immediate
family member of the Henschels or a trust for the benefit of the immediate
family members of the Henschels, written confirmation from the Facility Lenders
and the Company that such person or entity has assumed and agreed to be bound by
the terms hereof by written instrument in form reasonably satisfactory to the
Company and the Facility Lenders shall constitute the Facility Lender Consent.
<PAGE>
IN WITNESS WHEREOF, the parties have caused this Agreement to
be duly executed as of the date first above written.
IMC MORTGAGE COMPANY
By: /s/
-----------------------------------
Name:
Title:
NEAL HENSCHEL
By: /s/
-----------------------------------
JEFFREY M. HENSCHEL
By: /s/
-----------------------------------
GREENWICH STREET CAPITAL PARTNERS II, L.P.
GSCP OFFSHORE FUND, L.P.
GREENWICH FUND, L.P.
GREENWICH STREET EMPLOYEES FUND, L.P.
TRV EXECUTIVE FUND, L.P.
By: GREENWICH STREET INVESTMENTS II,
L.L.C., their General Partner
By: /s/
-----------------------------------
Name:
Title: Managing Member
<PAGE>
Notice Address for Other Secured Creditors
Bear, Stearns & Co., Inc.
if to Bear, Stearns: Bear Stearns & Co. Inc., 245 Park Avenue, New York, New
York 10167, Attn: Philip M. Cedar, Tel.: (212) 272-6768, Fax: (212) 272-4933 and
Paul Friedman, Tel.: (212) 272-3516, Fax: (212) 272-6550, with a copy to;
Cadwalader, Wickersham & Taft, 100 Maiden Lane, New York, New York 10038, Attn.
Barry J. Dichter, Esq., Tel.: (212) 504-6000, Fax: (212) 504-6666;
Deutsche Lenders
if to German American Corporation, to: German American Capital Corporation, 31
West 52nd Street, New York, New York 10019, Attn.: Vijay Radhakishun, Tel.:
(212) 469-8925, Fax: (212) 469-5923, with a copy to: Deutsche Bank A.G., as
agent, 31 West 52nd Street, New York, New York 10019, Attn.: Greg Amoroso, Tel.:
(212) 469-3987, Fax: (212) 469-5160, and Richard Uhlig, Tel.: (212) 469-7730,
Fax: (212) 469-5103; and in either case described in clause (i) or (ii) above;
with a copy to Cadwalader, Wickersham & Taft, 100 Maiden Lane, New York, New
York 10038, Attn.: Karen Gelernt, Esq., Tel: (212) 504-6000, Fax: (212) 504-6666
Paine Webber
if to Paine Webber, to: PaineWebber Real Estate Securities, Inc., 1285 Avenue of
the Americas, New York, New York 10019, Attn.: George Mangiaracina, Tel: (212)
713-3734, Fax: (212) 265-3881; with a copy to Cadwalader, Wickersham & Taft, 100
Maiden Lane, New York, New York 10038, Attn.: Michael S. Gambro, Esq., Tel:
(212) 504-6825; Fax: (212) 504-6666
BankBoston Facility
if to the Facility Lenders, as successors in interest to BankBoston, to: the
address provided for notice to the Facility Lenders pursuant to Section 16 of
the foregoing Agreement
Exhibit 10.86
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT ("Agreement") entered into as of the
1st day of November, 1999 by and between IMC MORTGAGE COMPANY, INC., a Florida
corporation (the "Company"), and DENNIS J. PITOCCO ("Executive").
R E C I T A L S:
A. The Company owns and operates a mortgage banking business and
provides related services (the "Business") and is in the process of winding down
the Business;
B. The Company desires to employ Executive in the initial
capacity of President, Chief Operating Officer and Chief Accounting Officer, and
may, at the election of the board of directors of the Company, be employed
hereafter as Chief Executive Officer of the Company (the "Position") and
Executive desires to be employed by the Company in such capacity;
C. Executive has substantial experience and expertise in the
skills required for the Position and the Company has determined that it is in
the best interest of the Company to employ Executive and to utilize his
expertise and experience; and
D. The Company believes that it is in the best interest of the
Company to assure Executive of a secure minimum compensation and to diminish the
inevitable distraction of Executive that may result from concern as to loss of
employment.
NOW, THEREFORE, in consideration of the mutual promises and
covenants contained in this Agreement, the parties agree as follows:
1. Recitations. The above recitations are true and correct and
are incorporated herein by this reference.
2. Position of Employment. The Company hereby employs Executive
in the Position commencing as of the Commencement Date (as defined in Section
3.1 herein).
2.1 Performance of Duties. Executive shall perform such
duties as are usually performed by a person serving in the Position with a
business similar in size and scope as the Company and such other additional
duties as may be prescribed from time to time by the Company which are
reasonable and consistent with the Company's operations, taking into account
Executive's expertise and job responsibilities.
2.2 Devotion of Time. During the term of this Agreement,
Executive agrees to devote such of the Executive's business time and attention
to the business and
<PAGE>
affairs of the Company to discharge the responsibilities assigned to Executive
and to use best efforts to perform faithfully and efficiently such
responsibilities. The Parties anticipate that Executive's full business time
(subject to duties relating to PFL as described below) will be required for the
first two years, 75% of Executive's business time will be required for the third
year and 50% of Executive's business time required thereafter. The parties
acknowledge that the Executive also provides services for Preferred Mortgages,
Limited, a company in the United Kingdom ("PML") and serves as an officer and
director of PML. The Executive is also compensated by PML unrelated to this
Agreement. Moreover, upon termination of the operations of the Company's
subsidiary, IMCC International, Inc., which the Company anticipates immediately
following the Commencement Date, an entity owned or controlled by the Executive
may enter into consulting or management agreements with PML and be compensated
therefor unrelated to this Agreement.
3. Term of Employment.
3.1 Term of Employment. This Agreement shall begin as of
the effective date of the closing of the purchase by CitiFinancial Mortgage
Company of the Company's mortgage servicing business and loan origination
platform (the "Commencement Date") and end on December 31, 2003; provided,
however, that the term shall thereafter be automaticly renewed for additional
periods of one year each unless either party gives written notice to the other
of intent not to renew no later than one hundred eighty (180) days prior to the
end of the then current term of this Agreement.
3.2 Termination of Employment by the Company for Cause. The
Company may terminate Executive's employment if such termination is for "Cause"
(as defined herein). For the purposes of this Agreement, "Cause" shall be
defined as any of the following:
(a) a default or breach by Executive of any of the
provisions of this Agreement;
(b) actions by Executive constituting fraud,
embezzlement or dishonesty;
(c) actions by Executive in intentionally furnishing
materially false, misleading, or omissive information to the Company or persons
to whom the Executive reports; or
(d) acts or omissions which constitute failure to
follow reasonable and lawful directives of the Company.
3.3 Termination Without Cause. The Company shall have the
right to terminate this Agreement without Cause at any time upon written notice,
subject to payment
<PAGE>
by the Company of the Deferred Compensation described in Section 4.2 herein.
3.4 Termination by Executive. Executive may terminate this
Agreement upon thirty (30) days written notice after the occurrence of a
material default of this Agreement by the Company, which default is not cured
within the thirty-day notice period. Such notice shall set forth in reasonable
detail the facts underlying the default. If Executive terminates this Agreement
under this Section 3.4, Executive shall be entitled to the Deferred Compensation
as described in Section 4.2 herein. The Executive may terminate at any time
without cause on thirty days prior written notice, but upon doing so, will be
paid his Base Compensation only through the date of termination and will not
receive any Deferred Compensation if such termination is effective before June
1, 2001, but nevertheless retains the Incentive Compensation.
4. Compensation.
4.1 Salary. In consideration for the services to be
provided by Executive pursuant to this Agreement Company shall pay to Executive
the sum of the following:
(a) Base Salary: As "Base Salary," the annual sums as
follows which amount will automatically increase effective as of each annual
anniversary of the Commencement Date by the "COLA Adjustment" (as defined
below):
Period Annual Base Salary
------ ------------------
Commencement to Dec. 31, 2001 $250,000
Jan, 1, 2002 - Dec. 31, 2002 $187,500
Jan. 1, 2003 - Thereafter $125,000
as that amount in increased from time to time in the sole discretion of the
Company. Base Salary shall be payable in installments consistent with the
Company's normal payroll schedule, in effect from time to time, subject to
applicable withholding and other taxes;
"COLA Adjustment" means an annual increase equal to the
percentage increase, if any, of the consumer price index for Urban Wage Earning
and Clerical Workers (Greater Metropolitan Tampa Area, all items) issued by the
Bureau of Labor Statistics of the U.S. Department of Labor using the year 1967
as a base of 100 (the "Index") from the prior year using the Commencement Date
as the anniversary date for such calculation. In the event the Index ceases to
be published during the term of this Agreement or any extension thereof, the
parties shall use a mutually acceptable comparable statistical index on the cost
of living in the United States as shall then be computed and published by an
agency of the United States.
<PAGE>
(b) Quarterly Bonus Compensation. As "Quarterly Bonus
Compensation" the following amounts paid (if Executive is still employed on the
payment date) at the following times:
Quarterly Bonus Payable
Period Last Day of Each March, June, Sept. & Dec.
------ ------------------------------------------
Jan. 1, 2000 - Dec. 31, 2001 $25,000
Jan. 1, 2002 - Dec. 31, 2002 $18,750
Jan. 1, 2003 - Thereafter $12,500
(c) Incentive Compensation. As "Incentive
Compensation" the "Incentive Percent" (as defined below) of any one or more of
the following whenever such should occur after the date hereof and whether or
not Executive is then still employed hereunder (collectively, the "Common Stock
Payments") (i) all distributions by the Company to all holders of common stock
of the Company, (ii) the amounts paid by a the Company in redemption of its
common stock, and (iii) all amount paid by any single third party (or related
group of third parties) to acquire the company's common stock in a tender offer
or other series of related transactions not in open market transactions. The
Incentive Percent shall be based upon the length of Executive's employment
hereunder as follows:
Termination Occurs Incentive Percent
------------------ -----------------
Before 12/31/00 1.5385%
1/1/01 - 12/31/01 3.0769%
1/1/02 - 12/31/02 4.2308%
1/1/03 - Thereafter 5.0000%
The Incentive Compensation will be calculated at the highest Incentive Percent
to which the Executive is entitled at the time of his termination of employment
regardless of when the event occurs giving rise to the payment of Incentive
Compensation.
4.2 Deferred Compensation.
(a) When Due. Executive (or his estate as the case may
be) shall be entitled to the Deferred Compensation hereto in the event that
Executive's employment is terminated for any of the following ("Deferred
Compensation Events"): (i) death of Executive; (ii) termination by the Company
without cause pursuant to Section 3.3; (iii) termination by Executive upon
default by the Company pursuant to Section 3.4; or (iv) termination by the
Executive effective after June 1, 2001, for any reason or for no reason.
(b) Amount. The Deferred Compensation shall be the
amount ("Base
<PAGE>
Deferred Compensation" plus "Quarterly Bonus Compensation") which is equal to
twelve months Base Compensation at the then current rate of Base Compensation
and Quarterly Bonus Compensation due over the ensuing twelve months.
(c) Payment of Deferred Compensation. The Deferred
Compensation shall be paid in immediately available funds within sixty (60) days
following the Deferred Compensation Event.
(C) Sole Remedy. The Executive agrees that the
payment to the Executive of the Deferred Compensation provided herein is the
Executive's sole remedy for any termination of Executive's employment hereunder
prior to the Initial Termination Date regardless of whether or not such
termination was by the company without Cause; provided, however, that such
Deferred Compensation payment will not terminate Executive's rights to receive
any Incentive Compensation to which Executive is thereafter due.
4.3 Additional Benefits.
(a) Vacation. Executive shall be entitled to paid
vacation and paid holidays during each twelve-month period during the term of
this Agreement in accordance with the Company's normal policy in effect from
time to time.
(b) Reimbursement of Expenses. Executive is authorized
to incur reasonable traveling and other expenses in connection with the Business
and in performance of his duties under this Agreement. Executive shall be
reimbursed by the Company for all Business expenses which are reasonably
incurred by Executive. All reimbursable travel expenses shall be in accordance
with the Company's reasonable policies in effect from time to time.
(c) Participation in Executive Benefit Plans.
Executive shall be entitled to participate, subject to eligibility and other
terms generally established by the Board of Directors, in any Executive benefit
plan (including but not limited to life insurance plans, group hospitalization,
health, dental care, which health insurance shall also cover Executive's
dependents) as may be adopted or amended by the Company from time to time and
applicable generally to Executives of the Company in the same level as the
Position.
5. Representation by Executive. Executive hereby represents to
the Company that he is physically and mentally capable of performing his duties
hereunder and he has no knowledge of any present or past physical or mental
condition which would cause him not to be able to perform his duties hereunder.
6. Confidentiality and Non-Disclosure of Information.
6.1 Confidentiality. Executive shall not, during the term
of this
<PAGE>
Agreement or at any time thereafter, divulge, furnish or make accessible to
anyone, without the Company's prior written consent, any knowledge or
information with respect to any confidential or secret aspect of the Business
which if disclosed could reasonably be expected to have an adverse affect on the
Business ("Confidential Information").
6.2 Ownership of Information. Executive recognizes that all
Confidential Information and copies or reproductions thereof, relating to the
Company's operations and activities made or received by Executive in the course
of his employment are the exclusive property of the Company and Executive holds
and uses same as trustee for the Company and subject to the Company's sole
control and will deliver same to the Company at the termination of his
employment, or earlier if so requested by the Company in writing. All of such
Confidential Information, which if lost or used by Executive outside the scope
of his employment, could cause irreparable and continuing injury to the
Company's Business for which there may not be an adequate remedy at law.
7. Remedies. Executive hereby acknowledges, covenants and agrees
that in the event of a material default or breach under this Agreement:
7.1 Company may suffer irreparable and continuing damages as
a result of such breach and its remedy at law will be inadequate. Executive
agrees that in the event of a violation or breach of this Agreement, in addition
to any other remedies available to it, Company shall be entitled to an
injunction restraining any such default or any other appropriate decree of
specific performance, with the requirement to prove actual damages or to post
any bond or any other security and to any other equitable relief the court deems
proper; and
7.2 Any and all of Company's remedies described in this
Agreement shall not be exclusive and shall be in addition to any other remedies
which Company may have at law or in equity including, but not limited to, the
right to monetary damages.
8. Indemnity. To induce Executive to accept the Positions
described above as well as any other or additional positions as may be mutually
agreed upon by the Company and Executive, the Company hereby covenants and
agrees with Executive, as follows:
8.1 Definitions. For purposes of this Agreement:
(A) "Affiliate" means any corporation, subsidiary, or
other entity controlled by, controlling or under common control with the Company
which now exists or may hereafter be formed or acquired.
(B) "Expenses" include all expenses actually and
reasonably incurred
<PAGE>
with respect to a Proceeding, including, without limitation, fees, expenses and
disbursements of attorneys, accountants, financial consultants and other
professionals.
(C) "Liabilities" means all liabilities, and/or
obligations, including, without limitation, obligations to pay a judgment,
settlement, penalty, fine or tax (including, without limitation, any withholding
or employment tax and any excise tax assessed with respect to the Company, any
Affiliate, any employee benefit plan or any other enterprise as to which
Executive is or was serving in an Official Capacity), together with any
obligation to pay interest thereon.
(D) "Proceeding" includes any threatened, asserted,
pending or completed claim, action, suit or other type of proceeding, whether
civil, criminal, administrative or investigative, whether formal or informal,
including, without limitation, any arbitration or mediation proceeding or other
proceeding for the resolution of any claim or dispute and any privately
conducted negotiations, and including, without limitation, any settlement,
hearing, trial or appeal of any of the foregoing.
(E) "Serving in an Official Capacity" includes (i)
serving as a director, officer, advisor or agent of the Company or any Affiliate
or (ii) serving at the request of the Company or any Affiliate as a director,
officer, advisor or agent of, or in any other capacity for, another corporation,
partnership, joint venture, trust or other enterprise, including any employee
benefit plan.
8.2 Statutory Indemnification. The Company hereby agrees to
indemnify and hold harmless Executive to the fullest extent permitted or
required by the provisions of the laws of Florida and the laws of the state of
Company's formation, if different from Florida and to cause any Affiliate to
indemnify and hold harmless Executive to the fullest extent permitted or
required by the laws of the State of Florida or the laws of its state of
formation (if different from Florida) against any Liability or Expense incurred
by Executive by reason of the fact that he is or was Serving in an Official
Capacity. The Company agrees that such obligation shall be to the fullest extent
required or permitted by any subsequent amendment to any of such provisions of
the Florida Statutes or the laws of its state of formation (if different from
Florida) or by the any other statutory provisions permitting or requiring such
indemnification which are adopted after the date of this Agreement (but in the
case of any amendment or subsequent statutory provisions, only to the extent
that such amendment or provisions permit or require broader or more extensive
indemnification rights than prior thereto).
8.3 Additional Indemnification. Subject only to the
exclusions set forth in this Section 8.3, the Company further agrees to
indemnify and hold harmless and to cause any Affiliate to indemnify and hold
harmless Executive against any and all Liabilities and/or Expenses incurred by
Executive in connection with any Proceeding to which Executive is or was a party
or is threatened to be made a party by reason of the fact that Executive is or
was
<PAGE>
Serving in an Official Capacity. Executive shall not be entitled to any
indemnification pursuant to this Section 3 if a judgment or other final
adjudication establishes that any act or omission of Executive was material to
the cause of action so adjudicated and that such act or omission constituted an
act or omission for which Company is prohibited by applicable law from providing
an indemnity.
8.4 Advance of Expenses. The Company shall advance or cause
any Affiliate to advance Expenses incurred by Executive in defending any
Proceeding for which Executive may be entitled to indemnification hereunder,
provided that the Company or any Affiliate shall not be required to advance any
sums for such Expenses if the Board of Directors of the Company or the Board of
Directors or similar managing body of any Affiliate, as the case may be, makes a
preliminary good faith determination that Executive engaged in willful
misconduct or acted with a conscious disregard for the best interests of the
Company or any Affiliate, as the case may be (but no such determination by the
Board of Directors of any Affiliate alone shall have any effect upon the
obligations of the Company under this Agreement without such a determination by
the Board of Directors of the Company). Executive hereby agrees to repay any
such advances of Expenses made hereunder with respect to a matter if Executive
is ultimately found not to be entitled to indemnification hereunder with respect
to such matter.
8.5 Obligations of Company and Affiliate; Separate
Obligations. It is the intention of the parties that Executive be entitled to
indemnification to the broadest possible extent allowed by law. Accordingly, any
ambiguity in this Agreement shall be construed in favor of indemnification.
Furthermore, in the event that applicable law would not permit or require
indemnification as to a Liability or Expense but Florida law would, or vice
versa, or in the event that a Liability or Expense would be indemnifiable under
both laws but the law of one would permit or require broader indemnification
than the other, Executive shall be indemnified pursuant to the law that will
provide maximum indemnification. The obligations of the Company under this
Agreement are separate, independent and primary obligations of the Company, and
may be enforced directly against the Company without any necessity for joining
any Affiliate or any other enterprise as to which Executive is or was Serving in
an Official Capacity, for recovering or seeking to enforce any judgment against
any Affiliate or such other enterprise, or for otherwise seeking to recover from
or out of the assets of any Affiliate or any such other enterprise, whether or
not any Affiliate or any such other enterprise has assets sufficient for such
recovery.
8.6 Notification of Defense of Claim. Promptly after receipt
by Executive of the notice of any Proceeding (including any threat thereof) as
to which Executive may be entitled to indemnification hereunder, Executive shall
notify the Company in writing thereof. Failure to so notify the Company shall
not relieve the Company from any obligation hereunder except to the extent that
it may suffer material prejudice by reason of such failure. With respect to any
such Proceeding as to which Executive notifies the Company thereof:
(A) The Company shall be entitled to participate therein at
its own
<PAGE>
expense.
(B) Except as otherwise provided below, the Company shall be
entitled to assume the defense thereof on behalf of Executive, with counsel
satisfactory to Executive, acting reasonably. Executive shall have the right to
employ his own separate counsel in such Proceeding, and the fees, expenses and
disbursements of Executive's own separate counsel incurred after written notice
from the Company to Executive of its assumption of the defense thereof and after
the full assumption of such defense by counsel engaged by the Company and
satisfactory to Executive, acting reasonably, shall be the expense of Executive
except ((1) if the employment of counsel by Executive has been authorized by the
Company, or ((2) if Executive shall have reasonably concluded that there may be
a conflict of interest between Executive and the Company with respect to the
defense of such action, or (iii) if any fees, expenses and disbursements of
Executive's own separate counsel are incurred in connection with familiarizing
or providing assistance to counsel employed by the Company, in which case the
fees, expenses and disbursements of Executive's own separate counsel shall be
paid by the Company. The Company shall not be entitled to assume the defense of
any Proceeding brought by or on behalf of the Company or as to which Executive
shall have made the conclusion provided for in (ii) above.
(C) The Company shall not be obligated to indemnify Executive
under this Agreement for any amounts paid in settlement of any Proceeding
effected without its written consent, not to be unreasonably delayed or
withheld. The Company shall not settle any action or claim in any manner which
would impose any penalty, limitation, Liability or Expense on Executive for
which Executive is not entitled to indemnification hereunder without Executive's
written consent.
8.7 Insurance. The Company shall maintain in force directors
and officers liability insurance in amounts and with coverage substantially the
same as that currently in effect and upon termination of Executive"s employment
hereunder will obtain extended reporting period ("tail coverage") for not less
than an additional three years. Nothing in this Agreement shall be deemed to
require indemnification of Executive to the extent that insurance proceeds under
any policy or policies of insurance carried by the Company, or any other person
or entity are available to satisfy any Liability or Expense incurred by
Executive by reason of the fact that he is or was Serving in an Official
Capacity.
9. Severability. The invalidity of any one or more of the words,
phrases, sentences, clauses, sections, subdivisions, or subparagraphs contained
in this Agreement shall not affect the enforceability of the remaining portions
of this Agreement or any part thereof, all of which are inserted conditionally
on their being legally valid. In the event that one or more of the words,
phrases, sentences, clauses, sections, subdivisions, subparagraphs, or articles
are determined to be unenforceable and if such invalidity shall be caused by the
length of any period of time or the size of any area set forth in any part
hereof, such period of time or such area, or both, shall be considered to be
reduced to a period or area which would cure
<PAGE>
such invalidity.
10. Successors and Assigns. This Agreement shall be binding upon
the parties hereto and their successors and assigns; provided, however, that
this Agreement shall be non-assignable by the Executive without the written
consent of the Company, it being understood that the Executive's obligations and
performance of this Agreement are personal in nature.
11. Notice. Any notices or other communications to any party
pursuant to or relating to this Agreement must be in writing and shall be deemed
to have been given or delivered when (i) hand-delivered, (ii) mailed through the
U.S. Postal Service via certified mail, return receipt requested, postage
prepaid, or (iii) delivered through a nationally recognized overnight courier,
to the party at their addresses below:
Company: IMC Mortgage Company
5901 East Fowler Avenue
Tampa, FL 33617-2211
Attn: Member of Board of Directors
Executive: Mr. Dennis J. Pitocco
4311 Round Lake Court
Tampa, FL 33624-5313
or such other address given by such party to the other party at any time
hereafter.
12. Miscellaneous.
12.1 Amendment. No amendment, waiver or modification of this
Agreement or any provisions of this Agreement shall be valid unless in writing
and duly executed by both parties.
12.2 Binding Agreement. This Agreement shall be binding upon and
inure to the benefit of the parties and their respective heirs, legal
representatives, successors and assigns.
12.3 Waiver. Any waiver by any party of any breach of any
provision of this Agreement shall not be considered as or constitute a
continuing waiver or waiver of any other breach of any provision of this
Agreement. EACH PARTY HERETO HEREBY WAIVES TRIAL BY JURY OF ANY MATTER ARISING
OUR OF OR RELATING TO THIS AGREEMENT OR THE EMPLOYMENT RELATIONSHIP OF Executive
AND COMPANY.
12.4 Captions. Captions contained in this Agreement are inserted
only as a
<PAGE>
matter of convenience or for reference and in no way define, limit, extend, or
describe the scope of this Agreement or the intent of any provisions of this
Agreement.
12.5 Attorneys' Fees. In the event of any litigation arising out
of this Agreement, the prevailing party shall be entitled to recover its
attorneys' fees and costs, including attorneys' fees and costs incurred on
appeal.
12.6 Governing Law. This Agreement shall be governed by the laws
of the State of Florida.
IN WITNESS WHEREOF, the parties have executed this Agreement as
of the day and year first above written.
Company:
IMC MORTGAGE COMPANY
By: /s/
-------------------------------
Thomas G. Middleton, President
Executive:
/s/
----------------------------------
Dennis J. Pitocco
Address:
--------------------------------
--------------------------------
--------------------------------
Exhibit 10.87
DELINQUENCY AND SERVICING ADVANCE PURCHASE AGREEMENT
THIS AGREEMENT entered into as of the 15th day of November, 1999,
("Purchase Date"), by and between IMC Mortgage Company, a Florida corporation,
with its principal place of business at 5901 East Fowler Avenue, Tampa, Florida
33617 (hereinafter called "Seller"), and CitiFinancial Mortgage Company, with
its principal place of business at 300 St. Paul Place, Baltimore, Maryland,21202
(hereinafter called "Purchaser").
WHEREAS, Seller desires to sell and Purchaser desires to purchase
certain servicing advances and delinquency advances related to certain Mortgage
Loans, the servicing rights to which were sold and purchased under an Asset
Purchase Agreement entered into by the parties as of July 13, 1999 ("Asset
Purchase Agreement").
NOW, THEREFORE, in consideration of the premises and the mutual promises and
covenants contained herein, the parties hereby agree as follows:
(1) Certain Definitions. All terms defined in the Asset Purchase
Agreement when used in this Agreement have the meaning
assigned to them in the Asset Purchase Agreement unless
specifically set forth otherwise herein.
(2) Purchased Assets. Upon the terms and subject to the conditions
of this Agreement, at the Closing, the Seller shall sell,
convey, assign, transfer and deliver to the Purchaser all of
Seller's right, title, and interest in assets listed on the
books of the Seller and on Schedule 1 to this Agreement
representing the Seller's right to recover delinquency
advances ("Delinquency Advances") or servicing advances
("Servicing Advances"), as those or similar terms are used in
various Servicing Agreements related to the Mortgage Loans
which have been securitized in the transactions identified on
Schedule 2.01 (a) (i) of the Asset Purchase Agreement
(collectively the "Purchased Assets").
(3) Purchase Price. The Purchase Price ("Purchase Price") for the
Purchased Assets will be calculated as follows:
(a) For the Servicing Advances, the Purchaser
shall pay the Seller the amount set forth on
Schedule 1 hereto, which amount shall be
89.55% of the book value of the Servicing
Advances as listed on general ledger of the
Seller as of the Closing Date. Prior to
Closing, the Seller shall provide the
Purchaser a written estimate of this
component of the Purchase Price calculated
as of that date.
(b) For the Delinquency Advances, the Purchaser
shall pay to Seller the amount set forth on
Schedule 1 hereto, which amount shall be the
book value of the Delinquency Advances as
listed on the general ledger of the Seller
as of the Closing Date less
<PAGE>
$3,000,000.00. Prior to Closing, the Seller
shall provide the Purchaser a written
estimate of this component of the Purchase
Price.
(c) Within 15 days from the Closing Date, the
parties shall agree upon any variance in the
written estimate of the Purchase Price and
the final Purchase Price as of Closing. In
the event of an overpayment, the Seller shall
pay the Purchaser the amount of overpayment.
In the event of an underpayment, the
Purchaser shall pay the Seller the amount of
underpayment.
(4) Representations and Warranties. All of the representations and
warranties of the Seller and the Purchaser contained in the
Asset Purchase Agreement are incorporated as if fully set
forth herein. In addition, the Seller represents and warrants
to the Purchaser that all of the information describing the
Delinquency Advances and the Servicing Advances listed on
Schedule 1 hereto is accurate and complete and is derived
according to Seller's customary and reasonable business
practices, that each Delinquency Advance or Servicing Advance
listed has actually been advanced, is genuine, has been
properly documented, and that the Purchaser has the right to
recover in full each listed Delinquency Advance or Servicing
Advance from the related Mortgagors under the Mortgage Loan
Documents or from liquidation proceeds on the related Mortgage
Loans, or from Custodial Accounts or the Investor, as such
terms or similar terms are used in the various Servicing
Agreements, or otherwise as set forth in the Servicing
Agreements, free and clear of all liens, and that such right
to recover is not subject to any known defenses of any
Mortgagor or any other person.
(5) Verification. For the purpose of verifying the Purchase Price
of the Servicing Advances and the Delinquency Advances as set
forth in Section (3) hereof and on Schedule 1, the Seller
shall, upon reasonable request by the Purchaser up to thirty
(30) calendar days after Closing Date, (i) provide the
Purchaser and its accountants, counsel and other authorized
representatives access, during normal business hours and under
reasonable circumstances, to any and all premises, properties,
Contracts, commitments, books, records and other information
of or relating to the Business and to the officers, employees
and agents of the Business and (ii) cause its officers to
furnish to the Purchaser and its authorized representatives
any financial, technical and operating data and other
information pertaining to the Business, as the Purchaser shall
from time to time reasonably request and which is either
normally available to the Seller in the ordinary and usual
course of business or which may be obtained or produced by the
Seller at a de minimis cost and effort to the Seller.
(6) Approvals, Third Party Consents. Prior to Closing, Seller
shall obtain all Approvals necessary from any person,
including but not limited to, Governmental Agencies, in order
to consumate the transaction contemplated by this Agreement.
The Seller shall also have obtained the release and
termination
<PAGE>
of any agreement restricting the Seller's right to withdraw or
distribute funds from any and all Custodial Accounts,
including but not limited to, the letter agreement dated June
21, 1999 between Greenwich Street Investments II, L.L.C. and
National City Bank of Kentucky and any similar agreements with
other institutions.
(7) Termination. In the event the Asset Purchase Agreement
terminates for any reason, this Agreement shall automatically
terminate at the same time.
(8) Carry Over Provisions. Article XIV of the Asset Purchase
Agreement, and any existing or future amendments thereto, are
incorporated as if fully set forth herein.
(9) Contingency. In the event that the closing of the Asset
Purchase Agreement does not occur for any reason then this
Agreement shall be null and void.
(10) Remedies. In addition to the requirements set forth in Section
3.01(b) of the Asset Purchase Agreement and subject to the
terms and conditions of that Section 3.01(b), payment of the
Contingent Purchase Price is conditioned upon compliance by
the Seller with the terms and conditions of this Agreement.
IMC MORTGAGE COMPANY,
as Seller
By: /s/
----------------------------------
Name:
Title:
Date:
CITIFINANCIAL MORTGAGE COMPANY,
As Purchaser
By: /s/
----------------------------------
Name:
Title:
Date:
