THE HUNTINGTON NATIONAL BANK Amended and Restated Promissory Note (D Note)
Exhibit
10.5
THE
HUNTINGTON NATIONAL BANK
Amended
and Restated Promissory Note
(D
Note)
|
$5,000,000.00
|
December
28, 2007 (the “Effective
Date”)
|
RECITALS
WHEREAS,
each of the borrowers set forth on Schedule 1 attached
to the Forbearance Agreement (as defined below) (individually a “Borrower” and
collectively, “Borrowers”) has
executed and delivered that certain Forbearance Agreement and Amendment to
Credit Agreements, dated as of the Effective Date, by and among Franklin Credit
Management Corporation (“FCMC”), Borrowers,
and The Huntington National Bank, successor by merger to Sky Bank (“Bank”), (the “Forbearance
Agreement”), and Borrowers and Bank desire to amend and restate the
original notes as set forth on Schedule 2 to the
Forbearance Agreement (the “Original Notes”);
and
WHEREAS,
Borrowers and Bank intend that (i) this Amended and Restated Promissory Note
(D
Note) (this "Note") will not
constitute a novation, (ii) this Note will amend and restate a portion of the
indebtedness, obligations and liabilities under the Original Notes, and (iii)
from and after the Effective Date, the Original Notes shall be of no force
or
effect, except to evidence the incurrence of Borrowers’ obligations thereunder;
and
WHEREAS,
Borrowers and Bank acknowledge and agree that this revolving note is the amended
and restated promissory note intended to evidence the indebtedness in respect
to
the Tranche D Advances;
NOW
THEREFORE, in consideration of the premises set forth above, the terms and
conditions contained herein, and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, Borrowers hereby
jointly and severally agree as follows:
PROMISE
TO
PAY
FOR
VALUE
RECEIVED, each of Borrowers, jointly and severally, promises to pay to the
order
of Bank, at ▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, or such other address
as Bank in writing shall provide to FCMC (as defined below), the sum of Five
Million and 00/100 Dollars ($5,000,000.00) (the “Principal Sum”), or
if less, the aggregate unpaid principal amount of all Tranche D Advances made
by
Bank to the Borrowers, together with interest as hereinafter provided and
payable at the times and in the manner hereinafter provided. All
payments made with respect to this Note shall be made to Bank in immediately
available funds.
This
Note
is issued pursuant to, and/or is entitled to the benefits of, the Forbearance
Agreement; the Credit Agreements; and the Loan Documents.
It
is
expressly understood and agreed by the parties hereto that this Note is not
intended to constitute a novation of the obligations and liabilities of
Borrowers under any Credit Agreement or the Original Notes and is not a payment
of any amounts due from any Borrower.
The
proceeds of the indebtedness evidenced hereby may be advanced, repaid and
readvanced in partial amounts during the term of this revolving note and prior
to maturity. Each such advance shall be made to Borrowers upon
receipt by Bank of the application by a Borrower therefor and disbursement
instructions, shall be in such form as Bank shall from time to time
prescribe. Bank shall be entitled to rely on any oral or telephonic
communication requesting an advance or providing disbursement instructions
hereunder, which shall be received by it in good faith from anyone reasonably
believed by Bank to be a Borrower, or the authorized agent of a
Borrower. Borrowers agree that all advances made by Bank will be
evidenced by entries made by Bank into its electronic data processing system
and/or internal memoranda maintained by Bank. Borrowers further agree
that the sum or sums shown on the most recent printout from Bank’s electronic
data processing system and/or on such memoranda shall be conclusive and binding
evidence (absent manifest error) of the amount of the Principal Sum and of
the
amount of any accrued interest.
INTEREST
(a)
Interest shall be calculated and will accrue on the unpaid balance of the
Principal Sum at the applicable Interest Rates as provided in the Forbearance
Agreement.
(b)
The books and records of Bank, absent manifest error, shall constitute binding
and conclusive evidence of the principal balance of the outstanding Principal
Sum and other amounts outstanding hereunder, and the date and amount of each
payment of principal and interest and applicable Interest Rates and other
information with respect thereto.
MANNER
OF PAYMENT; PRINCIPAL
BALANCE
(a)
The entire unpaid balance of the Principal Sum (including, without limitation,
all indebtedness in respect to Letters of Credit) shall be due and payable
on
the Tranche D Termination Date, and at maturity, whether by demand, acceleration
or otherwise.
(b)
In addition to any other amounts due and payable under this Note, Borrowers
shall deliver to Bank any other amounts due and payable from time to time under
the Forbearance Agreement in respect to the Tranche D Advances and Tranche
D
Note.
(c)
Bank and each Borrower hereby agrees and confirms that the outstanding principal
balances as of December 28, 2007, without giving effect to the forgiveness
of
debt set forth in Section 1(c) of the Forbearance Agreement, in respect to
each
of the Original Notes are as set forth on Schedule 2 to the
Forbearance Agreement.
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SECURITY
This
Note
is secured by the security interests, assignments, and mortgages granted or
referenced in the Credit Agreements, the Forbearance Agreement, and the Loan
Documents.
DEFAULT
If
a
Forbearance Default has occurred and is continuing, Borrowers shall be obligated
to pay Bank interest on the outstanding Principal Sum at the Post-Default Rate
(as defined in the Forbearance Agreement). Additionally, upon the
occurrence and continuation of a Forbearance Default, the unpaid balance of
Principal Sum and all accrued interest may be declared to be due and payable
all
in the manner, upon the conditions and with the effect provided in the
Forbearance Agreement.
GENERAL
PROVISIONS
Each
Borrower is accepting joint and several liability hereunder in consideration
of
the financial accommodations to be provided by Bank under this Note, for the
mutual benefit, directly and indirectly, of each Borrower and in consideration
of the undertakings of each Borrower to accept joint and several liability
for
all indebtedness, obligations and liabilities evidenced by this
Note. Each Borrower, jointly and severally, hereby irrevocably and
unconditionally accepts, as a surety and as a co-debtor, joint and several
liability with each other Borrower, with respect to the payment and performance
of all of the indebtedness, obligations and liabilities evidenced by this Note,
it being the intention of the parties hereto that all of the indebtedness,
obligations and liabilities evidenced by this Note shall be the joint and
several obligations of each Borrower without preferences or distinction among
them. The obligations of each Borrower under this paragraph shall not
be diminished or rendered unenforceable by any winding up, reorganization,
arrangement, liquidation, reconstruction or similar proceeding with respect
to
any Borrower. The joint and several liability of each Borrower
hereunder shall continue in full force and effect notwithstanding any
absorption, merger, amalgamation or any other change whatsoever in the name,
constitution or place of formation of any other Borrower or Bank. The
provisions of this paragraph are made for the benefit of Bank and its
respective successors and assigns, and may be enforced by it from time to time
against any or all Borrowers as often as occasion therefore may arise and
without requirement on the part of Bank (or its successors or assigns), first
to
marshal any of its claims or to exercise any of its rights against any other
Borrower or to exhaust any remedies available to it against any other Borrower
hereunder or to elect any other remedy. The provisions of this
paragraph shall remain in effect until all of the indebtedness, obligations
and
liabilities evidenced by this Note shall have been paid in full or otherwise
fully satisfied. If at any time, any payment, or any part thereof,
made in respect to any indebtedness, obligations or liabilities evidenced by
this Note, is rescinded or must otherwise be restored or returned by Bank for
any reason, the provisions of this paragraph will forthwith be reinstated in
effect, as though such payment had not been made. The obligations of
each Borrower under this paragraph constitute the absolute and unconditional,
full recourse obligations of each Borrower enforceable against each such
Borrower to the full extent of its
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properties
and assets, irrespective of the validity, regularity or enforceability of this
Note or any other circumstances whatsoever. Each Borrower, and any
indorser, surety, or guarantor, hereby jointly and severally waives notice
of
acceptance of its joint and several liability, presentment, notice of dishonor,
protest, notice of protest, and diligence in bringing suit against any party
hereto, waives the defenses of impairment of collateral for the obligation
evidenced hereby, impairment of a person against whom Bank has any right of
recourse, and any defenses of any accommodation maker and consent that without
discharging any of them, the time of payment and any other provision of this
Note may be extended or modified an unlimited number of times before or after
maturity without notice to Borrowers. Each Borrower jointly and
severally agrees that it will pay the obligations evidenced hereby, irrespective
of any action or lack of action on Bank’s part in connection with the
acquisition, perfection, possession, enforcement, disposition, or modification
of all the obligations evidenced hereby or any and all security therefore,
and
no omission or delay on Bank’s part in exercising any right against, or taking
any action to collect from or pursue Bank’s remedies against any party hereto
will release, discharge, or modify the duties of Borrowers, or any of them,
to
make payments hereunder. Each Borrower agrees that Bank, without
notice to or further consent from any Borrower, may release or modify any
collateral, security, guaranty or other document now held or hereafter acquired,
or substitute other collateral, security or other guaranties, and no such action
will release, discharge or modify the duties of Borrowers, or any of them,
hereunder. Each Borrower waives any claim or other right which it
might now have or hereafter acquire against any other person or entity that
is
primarily or contingently liable on the obligations that arise from the
existence or performance of each Borrower’s obligations under this Note,
including, without limitation, any right of subrogation, reimbursement,
exoneration, contribution, indemnification, or any right to participate in
any
claim or remedy of Bank or any collateral security which Bank now has or
hereafter acquires, whether such claim, remedy or right arises in equity, under
contract or statute, at common law, or otherwise.
No
reference herein to the Credit Agreements, the Forbearance Agreement, or the
Loan Documents shall alter or impair the obligations of each Borrower, which
is
absolute and unconditional, to pay the principal of and interest on this Note
at
the place and at the respective times herein prescribed. Each
Borrower promises to pay all costs and expenses, including reasonable attorneys’
fees and disbursements incurred in the collection and enforcement of this Note
or any appeal of a judgment rendered thereon.
Capitalized
terms used herein, but not
defined herein, shall have the meanings subscribed to such terms as set forth
in
the Forbearance Agreement.
The
captions used herein are for references only and shall not be deemed a part
of
this Note. If any of the terms or provisions of this Note shall be
deemed unenforceable, the enforceability of the remaining terms and provisions
shall not be affected. This Note shall be governed by and construed
in accordance with the law of the State of Ohio.
[SIGNATURE
PAGE FOLLOWS]
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IN
WITNESS WHEREOF, this Note is effective as of the date first appearing above
notwithstanding the date it is actually executed.
BORROWERS:
Each
Borrower listed on Schedule 1 attached
hereto:
By:
/s/
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Jardin
Name:
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Jardin
Title:
Chief Executive
Officer, as an authorized officer of,
and on behalf of, each such Borrower listed on Schedule
1
attached
hereto
THE
OBLIGATIONS OF THE BORROWERS UNDER THIS AMENDED AND RESTATED PROMISSORY NOTE
ARE
GUARANTEED BY FRANKLIN CREDIT MANAGEMENT CORPORATION PURSUANT TO A GUARANTY
DATED DECEMBER 28, 2007 IN FAVOR OF THE HUNTINGTON NATIONAL BANK.
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