Exhibit 10.2
THIRD AMENDMENT TO LOAN AGREEMENT
This THIRD AMENDMENT TO LOAN AGREEMENT is made and entered into as of
July 14, 2003 (as it may be modified, supplemented or amended from time to time
in accordance with its terms, this "AMENDMENT") by and between E-LOAN, INC., a
Delaware corporation (the "BORROWER"), and XXXXXXX XXXXX MORTGAGE CAPITAL INC.,
a Delaware corporation (together with its successors and assigns, "LENDER").
BACKGROUND
WHEREAS, the Borrower and the Lender entered into a Loan Agreement dated
as of June 14, 2002, as amended by the First Amendment dated as of June 16, 2002
and as amended by the Second Amendment dated as of June 3, 2003 (as amended,
supplemented and otherwise modified from time to time, the "EXISTING LOAN
AGREEMENT"), pursuant to which the Lender extended financing to the Borrower on
the terms and conditions set forth therein;
WHEREAS, the parties to the Existing Loan Agreement desire to amend the
Existing Loan Agreement;
NOW, THEREFORE, in consideration of the premises and the mutual
agreements herein contained, the parties hereto agree as follows:
SECTION 1. DEFINED TERMS. Capitalized terms used in this Amendment and
not otherwise defined herein shall have the meanings assigned to them in the
Existing Loan Agreement.
SECTION 2. AMENDMENT. Effective upon the execution and delivery of this
Amendment:
(a) The definition of "COMMITMENT TERMINATION DATE" in Section 1.22 of
the Existing Loan Agreement shall be amended and restated in its entirety as
follows: "means the earlier of (i) July 13, 2004, and (ii) the date on which the
Commitment is otherwise terminated in accordance with the terms of this
Agreement".
(b) The definition of "SECURITIZATION" in Section 1.22 of the Existing
Loan Agreement shall be amended and restated in its entirety as follows: "means
the issuance and sale of asset-backed securities secured directly or indirectly
by all or any portion of the collateral pledged to the Lender pursuant to the
Auto Fund Security Agreement and the other Credit Documents in a transaction
where at least one class or tranche of such asset-backed securities was rated by
one or more nationally recognized rating organizations. The financing by the
Lender of the Collateral pledged hereunder or the financing by the lender under
the Credit Documents of the collateral pledged pursuant to the Auto Fund
Security Agreement shall not be deemed a Securitization."
(c) Section 5.1(s) of the Existing Loan Agreement shall be amended and
restated in its entirety as follows:
(i) The Lender shall have the right to lead manage, at
commercially reasonable fees, all Securitizations, or any other long-term debt
financing, of any Receivables (as defined hereunder and under the Credit
Agreement) originated by the Borrower or any Affiliate or Subsidiary thereof
until the Lender shall have lead managed not less than Nine Hundred Million
Dollars ($900,000,0000) (based on the outstanding principal balance of such
Receivables as of the date of the related Securitization and/or long-term debt
financing) of such Securitizations and long-term debt financings; and
(ii) The Lender shall have (x) a right of first refusal with
regard to all auto loan and/or lease warehousing or financing relationships with
a credit quality substantially lower than the Eligible Contracts (as defined in
the Credit Agreement) and all whole loan sales, in each case by the Borrower or
any Affiliate or Subsidiary thereof and occurring on or before July 13, 2005,
and (y) except as set forth in clause (x) of this Section 5.1(s)(ii), an
exclusive right with regard to all auto loan and/or lease warehousing or
financing relationships of the Borrower and its Affiliates and Subsidiaries
occurring on or before the earlier of July 13, 2005 or the first Nine Hundred
Million ($900,000,000) of Receivables (based on the outstanding principal
balance of such Receivables as of the date of the related Securitization) have
been securitized pursuant to a Securitization; PROVIDED, HOWEVER, that the
Lender shall have no such right regarding (a) any corporate, non-asset backed
securities financing of the Borrower or any Affiliate or Subsidiary thereof, (b)
any sale of any equity securities of the Borrower or any Affiliate or Subsidiary
thereof or (c) any financing of the Borrower or any Affiliate or Subsidiary
thereof not secured in whole or in part by any Contracts; and
(iii) In the event that (A) the Borrower has been advised in a
written opinion to the Borrower from the Borrower's "Big Four" independent
accountants (which opinion shall be made available to the Lender by the
Borrower) that as a result of any adopted amendment or modification of Financial
Accounting Statement 140 from and after July 14, 2003, E-LOAN Auto Fund One, LLC
will not qualify as a Qualified Special Purpose Entity (as defined in FAS 140, a
"QSPE") if it were to draw any additional Advances under the Credit Agreement,
(B) the Borrower has delivered to the Lender a proposed amendment to the Credit
Agreement setting forth only such amendments as are necessary for E-LOAN Auto
Fund One, LLC to qualify as a QSPE and an opinion from the Borrower's "Big Four"
independent accountants (which opinion shall be made available to the Lender by
the Borrower) supporting the necessity of such requested amendments, and (C)
upon the earlier of (1) a final definitive written notice by the Lender on its
letterhead, and addressed to the Borrower, that it will not agree to such
amendments (for the avoidance of doubt, any proposed modifications or alternate
solutions proposed by the Lender or its agents shall not be deemed a refusal to
agree to the requested amendments) and (2) the expiration of forty-five (45)
days after the Borrower has delivered to the Lender such proposed amendment to
the Credit Agreement, then, notwithstanding clause (x) of Section 5.1(s)(ii),
the Borrower may seek an alternate source of auto loan and/or lease warehousing
or financing for any future Receivables (as defined in the Credit Agreement)
that it may originate and that causes the borrower under such auto loan and/or
lease warehousing or financing to qualify as a QSPE. Upon finalization of a term
sheet setting forth all of the material terms and conditions of any such
alternate auto loan and/or lease warehousing or financing that causes the
borrower thereunder to qualify as a QSPE, the Lender shall have the right of
first refusal with regard to the provisions of such term sheet that would cause
E-LOAN Auto Fund One, LLC or, in connection with an auto loan and/or lease
warehousing or financing on terms and
conditions no less favorable than those set forth in the Credit Agreement,
another Subsidary or Affiliate of the Borrower, in either case to be a QSPE. The
Lender shall exercise such right of first refusal no later than ten (10)
Business Days from delivery of such term sheet.
Borrower's obligations under this Section 5.1(s) are subject to Section
8.14 hereof."
SECTION 3. RESERVED.
SECTION 4. CONDITIONS PRECEDENT. The effectiveness of this Amendment is
subject to (a) the due authorization, execution and delivery by the parties
hereto of this Amendment, and (b) the due authorization, execution and delivery
by the parties to the Third Amendment to the Credit Agreement, dated July 14,
2003, by and among E-Loan Auto Fund One, LLC, E-Loan, Inc., and Xxxxxxx Xxxxx
Bank USA (as acknowledged and agreed to by Systems & Services Technologies, Inc.
as the Servicer).
SECTION 5. REPRESENTATIONS, WARRANTIES AND COVENANTS. (a) The Borrower
hereby confirms that each of the representations, warranties and covenants set
forth in the Existing Loan Agreement are true and correct as of the date first
written above with the same effect as though each had been made as of such date,
except to the extent that any of such representations, warranties or covenants
expressly relate to earlier dates. Except as expressly amended by the terms of
this Amendment, all terms and conditions of the Loan Agreement and the other
Loan Documents shall remain in full force and effect and the Borrower hereby
ratifies its obligations thereunder.
(b) The Borrower confirms that as of the date hereof its obligations
under the Existing Loan Agreement, as amended by this Amendment, and the other
Loan Documents are in full force and effect and are hereby ratified. The
Borrower represents and warrants that (i) no Default or Event of Default has
occurred, (ii) it has the power and is duly authorized to execute and deliver
this Amendment, (iii) this Amendment has been duly authorized, executed and
delivered and constitutes the legal, valid and binding obligation of it
enforceable against it in accordance with its terms, (iv) it is and will
continue to be duly authorized to perform its obligations under this Amendment
and the other Loan Documents, (v) the execution, delivery and performance by it
of this Amendment does not and will not require any consent or approval, which
has not already been obtained, from any Governmental Authority, shareholder or
any other Person, and (vi) the execution, delivery and performance by it of this
Amendment shall not result in the breach of, or constitute a default under, any
material agreement or instrument to which it is a party.
SECTION 6. SEVERABILITY. Any provision of this Amendment which is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions of this Amendment or affecting the
validity or enforceability of such provision in any other jurisdiction.
SECTION 7. GOVERNING LAW. THIS AMENDMENT SHALL BE CONSTRUED IN ACCORDANCE
WITH AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO
CONFLICT OF LAW PRINCIPLES; PROVIDED, THAT SECTIONS 5-1401 AND 5-1402 OF THE NEW
YORK GENERAL OBLIGATIONS LAW
SHALL APPLY, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER
SHALL BE DETERMINED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
SECTION 8. MISCELLANEOUS.
(a) The parties hereto hereby agree that the amendments set forth in
this Amendment shall be incorporated into the Existing Loan Agreement. This
Amendment constitutes the entire agreement concerning the subject matter hereof
and supercedes any and all written and/or oral prior agreements, negotiations,
correspondence, understandings and communications.
(b) Any reference to the Existing Loan Agreement from and after the
date hereof shall be deemed to refer to the Existing Loan Agreement as amended
hereby, unless otherwise expressly stated.
(c) This Amendment shall be binding upon and shall be enforceable by
parties hereto and their respective successors and permitted assigns.
(d) This Amendment may be executed by the parties hereto in several
counterparts, each of which shall be deemed to be an original but all of which
shall constitute together but one and the same agreement.
(e) The headings appearing in this Amendment are included solely for
convenience of reference and are not intended to affect the interpretation of
any other provision of this Amendment.
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IN WITNESS WHEREOF, the parties have caused this Amendment to be executed
by their respective officers thereunto duly authorized as of the day and year
first above written.
Lender:
XXXXXXX XXXXX MORTGAGE CAPITAL INC.
By: /s/ Xxxxxxx Xxxxx
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Name: Xxxxxxx Xxxxx
Title: Director
Borrower:
E-LOAN, INC.
By: /s/ Xxxx Xxxxxxx
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Name: Xxxx Xxxxxxx
Title: CFO
By: /s/ Xxxxxx X. Xxxxxxx
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Name: Xxxxxx X. Xxxxxxx
Title: President
