Guarantee Agreement

Amendment No. 1 to Guarantee Agreement

Exhibit 10.24.1

EXECUTION VERSION

AMENDMENT NO. 1 TO GUARANTEE AGREEMENT
AMENDMENT NO. 1 TO GUARANTEE AGREEMENT, dated as of September 13, 2018 (this “Amendment”), by and between DYNEX CAPITAL, INC., a Virginia corporation (“Guarantor”) and WELLS FARGO BANK, NATIONAL ASSOCIATION, a national banking association (“Buyer”). Capitalized terms used but not otherwise defined herein shall have the meanings given to them in the Repurchase Agreement (as defined below).
RECITALS
WHEREAS, Seller and Buyer are parties to that certain Master Repurchase and Securities Contract, dated as of August 6, 2012 (as amended by that certain Amendment No. 1 to Master Repurchase and Securities Contract, dated as of October 1, 2013, as further amended by that certain Amendment No. 2 to Master Repurchase and Securities Contract, dated as of February 5, 2015, as further amended by that certain Amendment No. 3 to Master Repurchase and Securities Contract, dated as of April 29, 2016, as further amended by that certain Amendment No. 4 to Master Repurchase and Securities Contract, dated as of May 12, 2017, and as further amended, restated, supplemented or otherwise modified and in effect from time to time, the “Repurchase Agreement”);
WHEREAS, in connection with the Repurchase Agreement, Guarantor executed and delivered to Buyer the Guarantee Agreement dated as of August 6, 2012, as amended hereby, and as further amended, restated, supplemented or otherwise modified and in effect from time to time, the “Guarantee Agreement”);
WHEREAS, Guarantor and Buyer have agreed to amend certain provisions of the Guarantee Agreement in the manner set forth herein.
Therefore, in consideration of the premises and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Guarantor and Buyer hereby each agree as follows:
SECTION 1.Amendment to Guarantee Agreement. The defined term “Liquidity”, as set forth in Section 1 of the Guarantee Agreement, is hereby amended and restated in its entirety to read as follows:
Liquidity”: At any time, an amount equal to the total amount of all unencumbered cash, cash equivalents and an amount equal to, without duplication, the sum of (i) ninety-five percent (95%) of the market value of all unencumbered Agency ARMs of Guarantor and its Subsidiaries at such time, (ii) eighty-five percent (85%) of the market value of all unencumbered CMBS (excluding any CMBS that is not, in connection with allocations of shortfalls or losses, of the most senior priority with respect to payments of principal and interest) of Guarantor and its Subsidiaries at such time with a rating of AAA or its equivalent from at least one of the Rating Agencies, and (iii) eighty-five percent (85%) of the market value of all unencumbered bonds (including, without limitation, unencumbered fixed-rate RMBS) of Guarantor and its Subsidiaries at such time, other than Agency ARMs, that are issued and guaranteed by Freddie Mac, Fannie Mae or GNMA, in each case determined in accordance with GAAP on a consolidated basis. For purposes of this definition, the term “RMBS” shall mean pass-through certificates representing beneficial ownership interests in one or more first lien mortgage loans secured by residential properties.
SECTION 2.    Conditions Precedent. This Amendment and its provisions shall become effective on the first date on which (i) this Amendment is executed and delivered by a duly authorized officer of Guarantor and Buyer and (ii) Guarantor shall provide Buyer with a currently dated incumbency certificate (the “Amendment Effective Date”).
SECTION 3.    Representations, Warranties and Covenants. Guarantor hereby represents and warrants to Buyer, as of the date hereof and as of the Amendment Effective Date, that (i) it is in full compliance with all of the terms and provisions set forth in each Repurchase Document to which it is a party on its part to be observed or performed, and (ii) no Default or Event of Default has occurred or is continuing. Guarantor hereby confirms and reaffirms its representations, warranties and covenants contained in each Repurchase Document to which it is a party.
SECTION 4.    Acknowledgements of Guarantor. Guarantor hereby acknowledges that Buyer is in compliance with its undertakings and obligations under the Repurchase Agreement and the other Repurchase Documents.
SECTION 5.    Limited Effect. Except as expressly amended and modified by this Amendment, the Fee and Pricing Letter shall continue to be, and shall remain, in full force and effect in accordance with their respective terms; provided, however, that upon the Amendment Effective Date, each (x) reference therein and herein to the “Repurchase Documents” shall be deemed to include, in any event, this Amendment, (y) reference to the “Guarantee Agreement” in any of the Repurchase Documents shall be deemed to be a reference to the Guarantee Agreement, as amended hereby, and (z) reference in the Guarantee Agreement to “this Guarantee Agreement”, “hereof”, “herein” or words of similar effect in referring to the Guarantee Agreement shall be deemed to be references to the Guarantee Agreement, as amended by this Amendment.
SECTION 6.    Counterparts. This Amendment may be executed by each of the parties hereto on any number of separate counterparts, each of which shall be an original and all of which taken together shall constitute one and the same instrument. Delivery of an executed counterpart of a signature page to this Amendment in Portable Document Format (PDF) or by facsimile transmission shall be effective as delivery of a manually executed original counterpart thereof.
SECTION 7.    Expenses. Guarantor agrees to pay and reimburse Buyer for all out-of-pocket costs and expenses incurred by Buyer in connection with the preparation, execution and delivery of this Amendment, including, without limitation, the fees and disbursements of Cadwalader, Wickersham & Taft LLP, counsel to Buyer.
SECTION 8.    GOVERNING LAW. THIS AMENDMENT AND ANY CLAIM, CONTROVERSY OR DISPUTE ARISING UNDER OR RELATED TO THIS AMENDMENT, THE RELATIONSHIP OF THE PARTIES TO THIS AMENDMENT, AND/OR THE INTERPRETATION AND ENFORCEMENT OF THE RIGHTS AND DUTIES OF THE PARTIES TO THIS AMENDMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS AND DECISIONS OF THE STATE OF NEW YORK, WITHOUT REGARD TO THE CHOICE OF LAW RULES THEREOF.  THE PARTIES HERETO INTEND THAT THE PROVISIONS OF SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW SHALL APPLY TO THIS AMENDMENT. 
[SIGNATURES FOLLOW]

IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed and delivered as of the day and year first above written.
GUARANTOR:
By:
/s/Stephen J. Benedetti    
Name: Stephen J. Benedetti
Title: Executive Vice President, Chief Financial
Officer, and Chief Operating Officer


BUYER:
WELLS FARGO BANK, N.A., a national banking association
By:
/s/ John Rhee    
Name: John Rhee
Title: Director


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