<PAGE> 1
FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
(Mark one)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED MARCH 31, 1999
or
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
Commission File Number: 0-20677
FIRSTCITY LIQUIDATING TRUST
(Exact name of registrant as specified in its charter)
Texas 06-6414468
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
1001 Fannin, Suite 505, Houston, Texas 77002
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (713) 651-7841
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes X No
--- ---
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date: As of March 31, 1999, 2,460,911
units of Class B Beneficial Interests and 738,273 units of Class C Beneficial
Interests were outstanding.
<PAGE> 2
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
FIRSTCITY LIQUIDATING TRUST AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF NET ASSETS IN LIQUIDATION
(DOLLARS IN THOUSANDS)
<TABLE>
<CAPTION>
MARCH 31, DECEMBER 31,
1999 1998
--------- -------
Assets, at estimated fair value (unaudited)
<S> <C> <C>
Cash and cash equivalents ............................ $ 8,185 $13,474
Trust assets, net .................................... 41,244 44,015
------- -------
Total assets .................................. 49,429 57,489
------- -------
Less liabilities at face or estimated amount
Payables and accrued liabilities ..................... 1,929 2,189
------- -------
Total liabilities ............................. 1,929 2,189
------- -------
Commitments and contingencies ........................ -- --
Trust net asset value attributable to:
Class "B" Certificate, 2,460,911 units outstanding ... 47,500 55,300
Class "C" Certificate, 738,273 units outstanding ..... -- --
------- -------
Total net asset value ......................... $47,500 $55,300
======= =======
</TABLE>
CONSOLIDATED STATEMENTS OF INCOME AND
CHANGES IN NET ASSET VALUE IN LIQUIDATION
(DOLLARS IN THOUSANDS)
(UNAUDITED)
<TABLE>
<CAPTION>
THREE MONTHS ENDED MARCH 31,
1999 1998
-------- --------
<S> <C> <C>
Changes in fair value of trust assets ........ $ 2,113 $ 24,766
Interest income on short-term investments .... 97 185
Administrative expense ....................... (1,397) (1,925)
-------- --------
Net income ............................ 813 23,026
-------- --------
Net asset value, beginning of period ......... 55,300 91,300
Distributions on Class "B" Certificate ....... (8,613) (17,226)
-------- --------
Net asset value, end of period ............... $ 47,500 $ 97,100
======== ========
</TABLE>
See accompanying notes to consolidated financial statements.
2
<PAGE> 3
FIRSTCITY LIQUIDATING TRUST AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(DOLLARS IN THOUSANDS)
(UNAUDITED)
<TABLE>
<CAPTION>
THREE MONTHS ENDED MARCH 31,
1999 1998
-------- --------
<S> <C> <C>
Cash flows from operating activities:
Net income .................................................. $ 813 $ 23,026
Adjustments to reconcile net income to net cash provided
by operating activities:
Changes in fair value of trust assets .................... (2,113) (24,766)
Collections on trust assets, net of advances ............. 4,862 44,621
Decrease in payables and accrued liabilities ............. (238) (692)
-------- --------
Net cash provided by operating activities ............. 3,324 42,189
-------- --------
Cash flows from financing activities:
Distributions on Class "B" Certificate ...................... (8,613) (17,226)
-------- --------
Net cash used in financing activities ................. (8,613) (17,226)
-------- --------
Net increase (decrease) in cash and cash equivalents ........ $ (5,289) $ 24,963
Cash and cash equivalents, beginning of period .............. 13,474 7,948
-------- --------
Cash and cash equivalents, end of period .................... $ 8,185 $ 32,911
======== ========
</TABLE>
See accompanying notes to consolidated financial statements.
3
<PAGE> 4
FIRSTCITY LIQUIDATING TRUST AND SUBSIDIARIES
Notes to Consolidated Financial Statements
March 31, 1999
(A) Basis of Presentation
The unaudited consolidated financial statements of FirstCity
Liquidating Trust (the "Trust", formerly the "Debtor") reflect, in the opinion
of management, all adjustments, consisting only of normal and recurring
adjustments, necessary to present fairly the Trust's net assets in liquidation
at March 31, 1999, and its changes in net asset value in liquidation and cash
flows for the three month periods ended March 31, 1999 and 1998.
Management of the Trust has made certain estimates and assumptions
relating to the reporting of assets and liabilities and the disclosure of
contingent assets and liabilities to prepare these consolidated financial
statements in conformity with generally accepted accounting principles. Actual
results could differ from those estimates.
Certain amounts in the financial statements for prior periods have been
reclassified to conform with current financial statement presentation.
(B) Trust Assets
Trust assets are comprised of the following (dollars in thousands):
<TABLE>
<CAPTION>
March 31, December 31,
Estimated Gross Cash Flow by Type of Asset 1999 1998
- ------------------------------------------ --------- ------------
(unaudited)
<S> <C> <C>
Borrowers' obligation on outstanding balance of:
Performing loans ................................ $ 11,365 $ 12,306
Nonperforming loans ............................. 755 815
Receivable from the FDIC ............................ 2,000 2,000
Real estate and other assets ........................ 33,947 36,556
-------- --------
Total ........................................... 48,067 51,677
-------- --------
Discount required to reflect trust assets at
estimated fair value ....................... (6,823) (7,662)
-------- --------
Trust assets, net ................................... $ 41,244 $ 44,015
======== ========
</TABLE>
For each asset, estimates of income, expense and net cash flow on a
monthly basis through the expected final disposition date are prepared. The
individual asset budget is developed based upon factors which include physical
inspection of the asset or the collateral underlying the related loan, local
market conditions, contractual payments or rents, and discussions with the
relevant borrower. The Trust's management and the Portfolio Committee
periodically reevaluate and revise projected monthly cash flows on an asset by
asset basis. At March 31, 1999 and December 31, 1998, the projected monthly cash
flows were discounted at 11% to reflect the Trust assets at estimated fair
value. The Trust assets are highly concentrated in Texas.
4
<PAGE> 5
FIRSTCITY LIQUIDATING TRUST AND SUBSIDIARIES
Notes to Consolidated Financial Statements
(continued)
In the first quarter of 1998, the Trust negotiated and received a
settlement of approximately $22 million from its fidelity bond carriers. As a
result of this settlement, there are no remaining claims of this nature.
(C) Distribution Priorities
The Trust is required to apply all proceeds from liquidation and
disposition of the Trust's assets first to payment of normal operating expenses.
Second, Trust proceeds totaling $188 million were distributed to FirstCity to
retire the Class A Certificate in December 1997. The third order of distribution
of Trust proceeds is payments pursuant to employment and bonus agreements with
certain former employees of the Debtor. The bonus pool and executive long-term
incentive plan provides for the payment of bonuses equal to 4.76% (which
percentage is lower due to employee reductions) of additional distributions to
Class B Certificate holders and (if any) Class C Certificate holders.
Fourth, Class B Certificate holders are entitled to distributions up to
the Pour-Over Level. The Pour-Over Level (approximately $70 million at March 31,
1999) is the liquidation preference on July 3, 1995 of the Debtor's Series B and
Series E preferred stock, less the nominal stated value of FirstCity special
preferred stock and the book value of FirstCity common stock issued to the
Series B and Series E holders, plus interest at an annual rate of 6.5% from July
3, 1995. The Pour-Over Level is also reduced for distributions to Class B
Certificate holders. In the first quarter of 1999, $8.6 million, or $3.50 per
certificate, was distributed to Class B Certificate holders and a $417,000 bonus
was paid to certain former employees of the Debtor. In 1998, $67.7 million, or
$27.50 per certificate, was distributed to Class B Certificate holders and a
$2.6 million bonus was paid to certain former employees of the Debtor. In April
1999, $9.8 million, or $4.00 per certificate, was distributed to Class B
Certificate holders and a $464,000 bonus was paid to certain former employees of
the Debtor.
Lastly, Class C Certificate holders receive distributions, if any,
after any remaining payments to Class B Certificate holders up to the Pour-Over
Level (approximately $28.28 per unit as of March 31, 1999).
The ultimate amounts to be distributed to the holders of the B and C
Certificates will result from the cash flow actually realized from the
liquidation of the non-cash Trust assets. The determination of the net asset
value of the Trust in the accompanying consolidated statements of net assets in
liquidation is based upon estimates of future cash flows. The actual cash flows
and the timing of such cash flows may vary significantly from those estimates,
thus affecting the final distributions to the Certificate holders.
5
<PAGE> 6
FIRSTCITY LIQUIDATING TRUST AND SUBSIDIARIES
Notes to Consolidated Financial Statements
(continued)
(D) Commitments and Contingencies
The Trust is involved in various legal proceedings in the ordinary
course of business. In the opinion of management of the Trust, the resolution of
such matters should not have a material adverse impact on the financial
position, results of operations or liquidity of the Trust.
In 1996 the FDIC closed the receiverships of the Debtor's banks and
distributed the remaining surplus of those receiverships to the Trust. In
accordance with a conveyance and indemnification agreement, the Trust is
required, among other things, to provide indemnity to the FDIC against any known
or unknown liabilities, obligations or actual expenses associated with the
receiverships, in an aggregate amount up to $10 million until the later of (i)
January 3, 2000 or (ii) the termination date of the Trust. Management of the
Trust does not believe that, to the extent the Trust is obligated to pay certain
claims or expenses associated with the past obligations of the Debtor's banks,
such payments will have a material adverse impact on the financial position,
results of operations or liquidity of the Trust.
6
<PAGE> 7
Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations.
The operations of the Trust for the first quarter of 1999 and 1998 are
summarized below (dollars in thousands):
<TABLE>
<CAPTION>
First Quarter First Quarter
1999 1998
------------- -------------
<S> <C> <C>
Changes in fair value of trust assets ........ $ 2,113 $ 24,766
Interest income on short-term investments .... 97 185
Administrative expense ....................... (1,397) (1,925)
-------- --------
Net income ............................ $ 813 $ 23,026
======== ========
</TABLE>
The estimated fair value of the Trust's assets increased $2.1 million
in the first quarter of 1999 as compared to $24.8 million in the first quarter
of 1998. The 1998 increase was attributable to several factors, including a
settlement of approximately $22 million from the Trust's fidelity bond carriers.
Other factors which contributed to the enhancement of the net asset value of the
Trust's assets in the first quarter of 1999 and 1998 include (i) the
appreciation in value of certain assets attributable to a favorable interest
rate environment and the effect of such favorable interest rates on the
marketability of real estate and (ii) the increase in the estimated market value
of the Trust's assets that naturally occurs as the remaining life of the Trust
(and concomitantly the discount factor applied in calculating net asset value)
decreases.
Interest income on short-term investments decreased in the first
quarter of 1999 as compared to the first quarter of 1998 because less excess
funds were available.
Administrative expense totaled $1.4 million in the first quarter of
1999 as compared to $1.9 million in the first quarter of 1998. A $417,000 bonus,
based on distributions to Class B Certificate holders, was paid to certain
former employees of the Debtor in the first quarter of 1999 as compared to a
$735,000 bonus paid in 1998. Professional fees totaled $.2 million in the first
quarter of 1999 as compared to $.3 million in the first quarter of 1998.
In the first quarter of 1999, the Trust distributed $8.6 million, or
$3.50 per certificate, to Class B Certificate holders. This distribution was
made possible principally by $4.9 million in net collections on Trust assets in
1999 and cash held at December 31,1998. The Class B Beneficial Interests were
valued at $47.5 million at March 31, 1999. In April 1999, the Trust distributed
an additional $9.8 million, or $4.00 per certificate, to Class B Certificate
holders.
7
<PAGE> 8
Non-cash trust assets at March 31, 1999 and December 31, 1998 were
comprised of the following (dollars in thousands):
<TABLE>
<CAPTION>
March 31, December 31,
Estimated Gross Cash Flow by Type of Asset 1999 1998
- ------------------------------------------ --------- ------------
<S> <C> <C>
Borrowers' obligation on outstanding balance of:
Performing loans ................................ $ 11,365 $ 12,306
Nonperforming loans ............................. 755 815
Receivable from the FDIC ............................ 2,000 2,000
Real estate and other assets ........................ 33,947 36,556
-------- --------
Total ........................................... 48,067 51,677
-------- --------
Discount required to reflect trust assets at
estimated fair value ....................... (6,823) (7,662)
-------- --------
Trust assets, net ................................... $ 41,244 $ 44,015
======== ========
</TABLE>
For each asset, estimates of income, expense and net cash flow on a
monthly basis through the expected final disposition date are prepared by
management of the Trust. The individual asset budget is developed based upon
factors which include physical inspection of the asset or the collateral
underlying the related loan, local market conditions, contractual payments or
rents, and discussions with the relevant borrower. The Trust's management
periodically reevaluates and revises its projected monthly cash flows on an
asset by asset basis. At March 31, 1999 and December 31, 1998, the projected
monthly cash flows were discounted at 11% to reflect the Trust assets at
estimated fair value.
The March 31, 1999 balance sheet of the Trust reflects a value of $27.5
million for a 67% interest in a partnership which owns the First City Tower.
First City Tower is a Class A office building located in downtown Houston. The
$27.5 million valuation reflects significant discounts against the asset because
of litigation (probable appeal of summary judgment rendered in favor of the
Trust) on the building, and because it is only a 67% interest. Using the current
valuation of the Trust, the interest in the First City Tower would have to be
sold for an amount in excess of approximately $50 million for the Class C
Certificates to realize any value. With the recent run-up in values for Houston
downtown office buildings, and assuming the summary judgment is upheld and the
sales price is not drastically discounted because the Trust's interest is only
67%, it is possible that the Class C Certificates could have value at some point
in the future. Investors are advised, however, that the Class C Certificates are
highly speculative securities.
In the first quarter of 1998, the Trust negotiated and received a
settlement of approximately $22 million from its fidelity bond carriers. As a
result of this settlement, there are no remaining claims of this nature.
8
<PAGE> 9
PART II - OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K.
(a) Exhibits
<TABLE>
<CAPTION>
Exhibit
No. Description
------- -----------
<S> <C>
2.1(1) Joint Plan of Reorganization for First City Bancorporation of
Texas, Inc., as modified, under Chapter 11 of the United
States Bankruptcy Code, as confirmed by the U.S. Bankruptcy
Court for the Northern District of Texas, Dallas division on
May 31, 1995.
3.1(1) The Liquidating Trust Agreement, dated as of July 3, 1995, by
and between First City Bancorporation of Texas, Inc. and
Shawmut Bank Connecticut, National Association (subsequently
Fleet National Bank, now State Street Bank and Trust Company),
as Trustee.
10.1(3) Employment Agreement, effective as of July 3, 1995, by and
between FCLT Loans Asset Corp. and Robert W. Brown, as amended
May 1, 1996.
10.2(2) Settlement Agreement, dated as of June 22, 1994, as amended as
of January 30, 1995, by and among FDIC-Corporate, the
FDIC-Receivers and the First City Parties.
10.3(3) Conveyance and Indemnification Agreement, dated December 23,
1996, between FDIC-Corporate, the FDIC-Receivers, FCLT Loans,
L.P. and the Trust.
10.4 Extension of Conveyance and Indemnification Agreement, dated
in April 1999, between FDIC-Corporate, the FDIC-Receivers,
FCLT Loans, L.P. and the Trust.
27.1 Financial Data Schedule.
</TABLE>
- ----------
(1) Filed as the exhibit indicated to the Registration Statement on
Form 10 filed with the Securities and Exchange Commission on May 1,
1996 and incorporated herein by reference.
(2) Filed as the exhibit indicated to the Registration Statement on
Form 10/A filed with the Securities and Exchange Commission on July 10,
1996 and incorporated herein by reference.
(3) Filed as the exhibit indicated to the Form 10-K for the fiscal year
ended December 31, 1996 filed with the Securities and Exchange
Commission and incorporated herein by reference.
(b) Reports on Form 8-K. No report on Form 8-K was filed by the
Registrant with the Commission during the quarterly period ended March
31, 1999.
9
<PAGE> 10
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
STATE STREET BANK AND TRUST
COMPANY, as Trustee
Date: April 30, 1999 /s/ Susan T. Keller
--------------------------------------
Name: Susan T. Keller
---------------------------------
Title: Vice President
--------------------------------
10
<PAGE> 11
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
Exhibit
No. Description
------- -----------
<S> <C>
2.1(1) Joint Plan of Reorganization for First City Bancorporation of
Texas, Inc., as modified, under Chapter 11 of the United
States Bankruptcy Code, as confirmed by the U.S. Bankruptcy
Court for the Northern District of Texas, Dallas division on
May 31, 1995.
3.1(1) The Liquidating Trust Agreement, dated as of July 3, 1995, by
and between First City Bancorporation of Texas, Inc. and
Shawmut Bank Connecticut, National Association (subsequently
Fleet National Bank, now State Street Bank and Trust Company),
as Trustee.
10.1(3) Employment Agreement, effective as of July 3, 1995, by and
between FCLT Loans Asset Corp. and Robert W. Brown, as amended
May 1, 1996.
10.2(2) Settlement Agreement, dated as of June 22, 1994, as amended as
of January 30, 1995, by and among FDIC-Corporate, the
FDIC-Receivers and the First City Parties.
10.3(3) Conveyance and Indemnification Agreement, dated December 23,
1996, between FDIC-Corporate, the FDIC-Receivers, FCLT Loans,
L.P. and the Trust.
10.4 Extension of Conveyance and Indemnification Agreement, dated
in April 1999, between FDIC-Corporate, the FDIC-Receivers,
FCLT Loans, L.P. and the Trust.
27.1 Financial Data Schedule.
</TABLE>
- ----------
(1) Filed as the exhibit indicated to the Registration Statement on
Form 10 filed with the Securities and Exchange Commission on May 1,
1996 and incorporated herein by reference.
(2) Filed as the exhibit indicated to the Registration Statement on
Form 10/A filed with the Securities and Exchange Commission on July 10,
1996 and incorporated herein by reference.
(3) Filed as the exhibit indicated to the Form 10-K for the fiscal year
ended December 31, 1996 filed with the Securities and Exchange
Commission and incorporated herein by reference.
<PAGE> 1
EXTENSION OF CONVEYANCE AND INDEMNIFICATION AGREEMENT
This EXTENSION OF THE CONVEYANCE AND INDEMNIFICATION AGREEMENT dated
October 1996 (the "Extension Agreement") is entered into between the FEDERAL
DEPOSIT INSURANCE CORPORATION ("FDIC") in its corporate capacity ("FDIC
Corporate"); the FDIC Receivers (as defined in that certain Settlement Agreement
dated as of June 22, 1994) (whether one or more, the "Indemnitee"); FCLT Loans,
L.P., as an assignee of First City Bancorporation of Texas, Inc. ("FCBOT") and
its related entities ("FCBOT Affiliated Entities") (FCBOT and the FCBOT
Affiliated Entities are collectively referred to as the "First City Parties")
and FIRSTCITY LIQUIDATING TRUST ("FCLT"). Capitalized terms used in this
Agreement and not otherwise defined shall be given the same meaning as set forth
in the Settlement Agreement (as defined below).
RECITALS:
WHEREAS, pursuant to the terms of that certain Settlement Agreement
dated as of June 22, 1994, between FDIC Corporate, the FDIC Receivers, and the
First City Parties, as amended as of January 30, 1995 (as amended, the
"Settlement Agreement"), the FDIC Receivers agreed to, among other things, (i)
effect distributions of the Surplus (as defined in the Settlement Agreement)
generated out of the First City Bank Receiverships (as hereinafter defined) to
the First City Parties and (ii) defend certain litigation and other disputed
matters of the First City Parties, the FDIC Receivers, FDIC Corporate and/or
certain other parties: and
WHEREAS, FCLT Loans, L.P. is an assignee of the First City Parties; and
WHEREAS, FCLT is the sole limited partner of FCLT Loans, L.P.; and
WHEREAS, the parties find it to be mutually desirable to terminate the
"Cash Holdback Reserve" established by the Conveyance and Indemnification
Agreement dated October 1996 prior to the anticipated termination date; and
WHEREAS, the FDIC desires to make an early final payment in the amount
of $2,514,550.28(1) (the "Final Payment "), and
WHEREAS, as a condition to making the Final Payment by the FDIC prior
to the scheduled termination date and as consideration therefor, the parties
desire to enter into this agreement whereby FCLT Loans, L.P. will continue to
provide indemnity to the FDIC against any known or unknown liabilities, claims
or expenses in an aggregate amount up to $10 million, associated with the First
City Bank Receiverships.
- ----------
(1) As of 1/31/99
<PAGE> 2
NOW THEREFORE, in consideration of the mutual promises and covenants
contained in this Extension Agreement and other good and valuable consideration,
the receipt and sufficiency of which is acknowledged, the parties agree as
follows:
1. DISTRIBUTION OF HOLDBACK ASSIGNMENT OF RIGHTS
a. ASSIGNMENT OF CASH HOLDBACK. As the final cash payment
pursuant to Section 5.1 of the Settlement Agreement and the terms of
the Conveyance and Indemnification Agreement dated October, 1996, the
FDIC Receivers hereby transfers, assigns and conveys unto FCLT Loans,
L.P. all of FDIC Receivers' rights, title and interest in and to the
Cash Holdback.
b. INDEMNIFICATION. As a condition to and in consideration of the
assignment of the Cash Holdback from the FDIC Receivers to FCLT Loans,
L.P., FCLT Loans, L.P. agrees to extend its indemnification of the
FDIC and agrees to indemnify the FDIC against any known or unknown
liabilities, obligations or expenses incurred by the FDIC which may
arise now or in the future until the Termination Date (as hereinafter
defined) associated with the FDIC Receivers (the "Indemnified
Obligations"). Such indemnification shall be subject to the conditions
and limitations, and governed by the procedures, set forth in Section
2 hereof.
2. INDEMNIFICATION
FCLT Loans, L.P. shall indemnify, and reimburse FDIC for all
liabilities, obligations, expenses, costs and any loss incurred by the
FDIC associated with the FDIC Receiverships, including, but not
limited to, expenses incurred in connection with the Outstanding
Claims; provided, however, that in no event shall FCLT Loans, L.P.'s
liability under Section 1(b) and this Section 2 exceed ten million
dollars ($10,000,000). The term "expenses" as used herein shall
include, but is not limited to, all research costs, accounting
charges, review fees, attorneys' fees, court costs, transcript costs,
fees of experts, witness fees, travel expenses, duplicating costs,
printing and binding costs, telephone charges, postage, delivery
service fees, and all other disbursements or expenses of any kind
incurred in connection with or related to the FDIC Receivers and in
defending litigation, preparing to defend, investigating, or being or
preparing to be a witness in litigation.
3. GENERAL
a. DURATION OF AGREEMENT. This Extension Agreement shall continue
until and terminate on Midnight C.S.T., January 3, 2000, or the final
termination of FCLT (whichever date is later, the "Termination Date"),
unless otherwise extended by the parties.
<PAGE> 3
b. SEVERABILITY. If any provision or provisions of this Extension
Agreement shall be held to be invalid, illegal or unenforceable for
any reason whatsoever; (i) the validity, legality and enforceability
of the remaining provisions of this Extension Agreement (including,
without limitation, each portion of any section of this Extension
Agreement containing any such provision held to be invalid, illegal or
unenforceable, that is not itself invalid, illegal or unenforceable)
shall not in any way be effected or impaired thereby; and (ii) to the
fullest extent possible, the provisions of this Extension Agreement
(including, without limitation, each portion of any section of this
Extension Agreement containing any such provision held to be invalid,
illegal or unenforceable, that is not itself invalid, illegal or
unenforceable) shall be construed so as to give effect to the intent
manifested thereby.
c. IDENTICAL COUNTERPARTS. This Extension Agreement may be
executed in one or more counterparts, each of which shall for all
purposes be deemed to be an original but all of which together shall
constitute one and the same agreement. Only one such counterpart
signed by the party against whom enforceability is sought needs to be
produced to evidence the existence of this Extension Agreement.
d. WAIVER. No delay on the part of the Indemnitee in exercising
any power or right shall operate as a waiver thereof; nor shall any
single or partial exercise of any power or right preclude other or
further exercise thereof or the exercise of any power or right. No
waiver by the Indemnitee of any right hereunder or of any default by
FCLT Loans, L.P. shall be binding upon the Indemnitee unless in
writing, and no failure by the Indemnitee to exercise any right
hereunder or waiver of any default FCLT Loans, L.P. shall operate as a
waiver of any other or further exercise of such right or of any
further default.
e. HEADINGS. The headings of the paragraphs of this Extension
Agreements are inserted for convenience only and shall not be deemed
to constitute part of or to effect the construction of this Extension
Agreement.
f. MODIFICATION AND WAIVER. This instrument contains the entire
agreement of the parties with respect to its subject matter. No
supplement, modification or amendment of this Extension Agreement
shall be binding unless executed in writing by all of the parties to
this Extension Agreement. No waiver of any of the provisions of this
Extension Agreement shall be deemed or shall constitute a waiver of
any other provisions (whether or not similar) nor shall such waiver
constitute a continuing waiver.
g. PARTIES BOUND. The rights of the Indemnitee hereunder shall
inure to the benefit of its successors and assigns. The terms of this
Extension Agreement shall be binding upon heirs, executors,
administrators, successors, and assigns of the parties hereto. All
representations, warranties and agreements of FCLT Loans, L.P. shall
bind FCLT Loans, L.P.'s personal representatives, heirs, successors
and assigns.
<PAGE> 4
h. NOTICE. All notices, requests, demands and other
communications hereunder shall be in writing and shall be deemed to
have been duly given if (i) delivered by hand and receipted for by the
party to whom said notice or other communication shall have been
directed, or (ii) mailed by certified or registered mail with postage
prepaid, on the third business day after mailing:
(a) If to Indemnitee, to:
Mr. Thomas J. O'Keefe, Assistant Director Field Operations
1910 Pacific, Suite 1700, Dallas, Texas 75201
with a copy to:
Regional Counsel FDIC Legal Division,
1910 Pacific, Suite 1700, Dallas, Texas
(b) If to FCLT or FCLT Loans, L.P., to:
Mr. Robert W. Brown, President, FCLT Loans Asset Corp.
First City Tower, 1001 Fannin, Suite 505, Houston, Texas 77002
with a copy to:
G. Michael Curran
Akin, Gump, Strauss, Hauer & Feld, L.L.P.
1700 Pacific Avenue, Suite 4100
Dallas, Texas 75201-4675
or to such other address as may have been furnished to Indemnitee by
FCLT or FCLT Loans, L.P. or to FCLT or FCLT Loans, L.P. by the
Indemnitee, as the case may be.
i. GOVERNING LAW. The parties agree that this Extension Agreement
shall be governed by, and construed and enforced in accordance with
the laws of the United States of America, and to the extent such law
is not applicable, with the laws of the State of Texas.
<PAGE> 5
IN WITNESS WHEREOF, the parties hereto have executed this Extension
Agreement on the day and year first above written.
FEDERAL DEPOSIT INSURANCE CORPORATION, in its
corporate capacity
By: /s/ THOMAS J. O'KEEFE
-----------------------------------
Name: Thomas J. O'Keefe
Title: Assistant Director Field Operations
FEDERAL DEPOSIT INSURANCE CORPORATION in its
capacity as the FDIC Receivers
By: /s/ THOMAS J. O'KEEFE
-----------------------------------
Name: Thomas J. O'Keefe
Title: Assistant Director Field Operations
FIRSTCITY LIQUIDATING TRUST
By: FLEET NATIONAL BANK, as Trustee
By: /s/ SUSAN T. KELLER
-----------------------------------
Name: Susan T. Keller
Title: Vice President
FCLT Loans, L.P., a limited partnership
By: FCLT LOANS ASSET CORP.,
its General Partner
By: /s/ ROBERT W. BROWN
-----------------------------------
Name: Robert W. Brown
Title: President
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
FIRSTCITY LIQUIDATING TRUST MARCH 31, 1999 FORM 10-Q FINANCIAL STATEMENTS AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FIRSTCITY LIQUIDATING TRUST MARCH
31, 1999 FORM 10-Q.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-START> JAN-01-1999
<PERIOD-END> MAR-31-1999
<CASH> 8,185
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 41,244
<CURRENT-ASSETS> 0
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 49,429
<CURRENT-LIABILITIES> 1,929
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 47,500
<TOTAL-LIABILITY-AND-EQUITY> 49,429
<SALES> 2,113
<TOTAL-REVENUES> 2,210
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 1,397
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 813
<INCOME-TAX> 0
<INCOME-CONTINUING> 813
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 813
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
