FIRST AMENDED AND RESTATED
MANAGEMENT AGREEMENT
THIS AGREEMENT, dated as of May 12, 1997 by and between OCWEN ASSET
INVESTMENT CORP., a Virginia corporation (the "REIT" and together with its
subsidiaries, the "Company"), and OCWEN CAPITAL CORPORATION, a Florida
corporation (the "Manager") and amended and restated in its entirety as of May
5, 1998;
W I T N E S S E T H:
WHEREAS, the Company intends to invest in Subordinated Interests,
Distressed Real Property, MBS and other real estate related assets ("REIT
Investments") and expects to qualify for the tax benefits accorded by Sections
856 through 860 of the Internal Revenue Code of 1986, as amended (the "Code");
and
WHEREAS, the Company desires to retain the Manager to acquire, sell and
otherwise manage the investments of the Company and to perform administrative
services for the Company in the manner and on the terms set forth herein;
NOW THEREFORE, in consideration of the mutual agreements herein set
forth, the parties hereto agree as follows:
SECTION 1. DEFINITIONS. Capitalized terms used but not defined herein
shall have the respective meanings assigned them in the Prospectus of the REIT
dated May 14, 1997. In addition, the following terms have the meanings assigned
them.
(a) "Agreement" means this Management Agreement, as amended from
time to time.
(b) "Closing Date" means the date of closing of the Company's
initial public offering of common stock.
(c) "Governing Instruments" means the articles of incorporation
and bylaws in the case of a corporation, or the partnership agreement in the
case of a partnership.
(d) "Subsidiary" means any subsidiary of the Company and any
partnership, the general partner of which is the Company or any subsidiary of
the Company.
SECTION 2. DUTIES OF THE MANAGER.
(a) The Manager at all times will be subject to the supervision of
the Company's Board of Directors and will have only such functions and authority
as the Company may delegate to it. The Manager will be responsible for the
day-to-day operations of the Company and will perform (or cause to be performed)
such services and activities relating to the assets and operations of the
Company as may be appropriate, including:
(i) serving as the Company's consultant with respect to
formulation of investment criteria and preparation of policy Guidelines
by the Board of Directors;
(ii) representing the Company in connection with the
purchase and commitment to purchase assets, the sale and commitment to
sell assets, and the maintenance and administration of its portfolio of
assets;
(iii) furnishing reports and statistical and economic
research to the Company regarding the Company's activities and the
services performed for the Company by the Manager;
(iv) monitoring and providing to the Board of Directors on
an ongoing basis price information and other data, obtained from
certain nationally recognized dealers that maintain markets in assets
identified by the Board of Directors from time to time, and providing
data and advice to the Board of Directors in connection with the
identification of such dealers;
(v) providing the executive and administrative personnel
and office space and office services required in rendering services to
the Company;
(vi) administering the day-to-day operations of the Company
and performing and supervising the performance of such other
administrative functions necessary in the management of the Company as
may be agreed upon by the Manager and the Board of Directors, including
the collection of revenues and the payment of the Company's debts and
obligations and maintenance of appropriate computer services to perform
such administrative functions;
(vii) communicating on behalf of the Company with the holders
of any equity or debt securities of the Company as required to satisfy
the reporting and other requirements of any governmental, bodies or
agencies and to maintain effective relations with such holders;
(viii) to the extent not Otherwise subject to an agreement
executed by the Company, designating a servicer for mortgage loans sold
to the Company by originators and arranging for the monitoring and
administering of such servicers;
(ix) counseling the Company in connection with policy
decisions to be made by the Board of Directors;
(x) counseling the Company regarding the maintenance of its
status as a REIT and monitoring compliance with the various REIT
qualification tests and other rules set out in the Code and regulations
thereunder;
(xi) engaging in hedging activities on behalf of the
Company, consistent with the Company's status as a REIT and with the
Guidelines; and
-2-
(xii) upon request by and in accordance with the directions
of the Board of Directors, investing or reinvesting any money of the
Company.
(B) REAL ESTATE ASSET PORTFOLIO MANAGEMENT. The Manager will
perform portfolio management services on behalf of OAIC and the Operating
Partnership with respect to the Company's REIT Investments. Such services will
include, but not be limited to, consulting the Company on purchase and sale
opportunities, collection of information and submission of reports pertaining to
the Company's assets, interest rates, and general economic conditions, periodic
review and evaluation of the performance of the Company's portfolio of assets,
acting as liaison between the Company and banking, mortgage banking, investment
banking and other parties with respect to the purchase, financing and
disposition of assets, and other customary functions related to portfolio
management. The Manager may enter into subcontracts with other parties,
including its Affiliates, to provide any such services to the Company.
(C) MONITORING SPECIAL SERVICING. The Manager will perform
monitoring services on behalf of the Company with respect to the Company's
portfolio of special servicing rights. Such monitoring services will include,
but not be limited to, the following activities: negotiating special servicing
agreements; serving as the Company's consultant with respect to the special
servicing of mortgage loans; collection of information and submission of reports
pertaining to the mortgage loans and to moneys remitted to the Manager or the
Company; acting as a liaison between the servicers of the mortgage loans and the
Company and working with servicers to the extent necessary to improve their
servicing performance; with respect to mortgage loans for which the Company is
special servicer, periodic review and evaluation of the performance of each
servicer to determine its compliance with the terms and conditions of the
related servicing agreement; review of and recommendations as to fire losses,
easement problems and condemnation, delinquency and foreclosure procedures with
regard to mortgage loans; review of servicers' delinquency, foreclosures and
other reports on mortgage loans; supervising claims filed under any mortgage
insurance policies; and enforcing the obligation of any servicer to repurchase
mortgage loans. The Manager may enter into subcontracts with other parties,
including its Affiliates, to provide any such services for the Manager.
(D) MONITORING SERVICING. The Manager will monitor and administer
the servicing of the Company's Mortgage Loans, other than loans pooled to back
MBS or pledged to secure MBS. Such monitoring and administrative services will
include, but not be limited to, the following activities: serving as the
Company's consultant with respect to the servicing of loans; collection of
information and submission of reports pertaining to the mortgage loans and to
moneys remitted to the Manager or the Company by servicers; periodic review and
evaluation of the performance of each servicer to determine its compliance with
the terms and conditions of the servicing agreement and, if deemed appropriate,
recommending to the Company the termination of such servicing agreement; acting
as a liaison between servicers and the Company and working with servicers to the
extent necessary to improve their servicing performance; review of and
recommendations as to fire losses, easement problems and condemnation,
delinquency and foreclosure procedures with regard to the Mortgage Loans: review
of servicers' delinquency, foreclosing and other reports on Mortgage Loam;
supervising claims filed under any mortgage
-3-
insurance policies; and enforcing the obligation of any servicer to repurchase
Mortgage Loans from the Company.
(E) BEST EFFORTS. The Manager agrees to use its reasonable best
efforts at all times in performing services for the Company hereunder.
SECTION 3. ADDITIONAL ACTIVITIES OF MANAGER. Nothing herein shall
prevent the Manager or any of its Affiliates from engaging in other businesses
or from rendering services of any kind to any other person or entity, including
investment in, or advisory service to others investing in, any type of real
estate investment, including investments which meet the principal investment
objectives of the Company.
Except as noted below, the Manager will not invest, and will not permit
any Affiliate of the Manager to invest, in a Subordinated Interest or Distressed
Real Property unless a majority of the Independent Directors of the Company
decline, on behalf of the Company, to make the investment. To assist the
Independent Directors' review of such a potential investment, the Manager shall
make available information to assist the Independent Directors in determining
whether the investment is consistent with the Guidelines, whether the price is
fair and whether the investment otherwise is in the best interest of the
Company. For a Distressed Real Property, such information shall include an
appraisal of an MAI appraiser who is certified or licensed in the state and
whose compensation is not dependent on the transaction. For a Subordinated
Interest, such information shall include, to the extent available or reasonably
obtainable, historical information about the collateral and securities, yield
tables that assume losses on the underlying collateral and a broker's price
opinion from a third party, such as the placement agent of the Subordinated
Interest.
Notwithstanding the foregoing, if the mortgage loans collateralizing a
Subordinated Interest were owned by the Manager or an Affiliate of the Manager,
then the Manager or its affiliates may retain such Subordinated Interest without
offering the investment to the Company. Moreover, if a large pool of mortgage
loans and REO Properties are offered for sale by a third party pursuant to a
competitive bidding process, the Manager or its affiliates may bid on such pool
jointly with an unaffiliated entity, as long as the Manager or its affiliates
take title only to the loans and not to the REO Properties. In the alternative,
the Manager may, but is not required to, invite the Company to bid jointly on
such a pool. If the Manager (or its affiliates) and the Company are successful
in such a bid, the Manager will take title to the loans and the Company will
take title to the real estate, unless otherwise approved by a majority of the
Independent Directors.
If the Company and the Manager (or its affiliates) co-participate in a
loan, the terms of the participation would be structured so that Ocwen Federal
Bank FSB would service the loans and retain a market servicing fee, after which
the remaining proceeds from the loan would be shared pari passu in accordance
with the ownership interests in the loan, unless another arrangement were
approved by a majority of the Independent Directors.
Directors, officers, employees and agents of the Manager or Affiliates
of the Manager may serve as directors, officers, employees, agents, nominees or
signatories for the REIT or any
-4-
Subsidiary, to the extent permitted by their Governing Instruments, as from time
to time amended, or by any resolutions duly adopted by the Board of Directors
pursuant to the REIT's Governing Instruments. When executing documents or
otherwise acting in such capacities for the Company, such persons shall use
their respective titles in the Company.
SECTION 4. COMMITMENTS. In order to meet the investment requirements
of the Company, as determined by the Board of Directors from time to time, the
Manager agrees at the direction of the Board of Directors to issue on behalf of
the Company commitments on such terms as are established by the Board of
Directors, including a majority of the Independent Directors, for the purchase
of REIT Investments.
SECTION 5. BANK ACCOUNTS. At the direction of the Board of Directors,
the Manager may establish and maintain one or more bank accounts in the name of
the REIT or any Subsidiary, and may collect and deposit into any such account or
accounts, and disburse funds from any such account or accounts, under such terms
and conditions as the Board of Directors may approve; and the Manager shall from
time to time render appropriate accountings of such collections and payments to
the Board of Directors and, upon request, to the auditors of the REIT or any
Subsidiary.
SECTION 6. RECORDS; CONFIDENTIALITY. The Manager shall maintain
appropriate books of accounts and records relating to services performed
hereunder, and such books of account and records shall be accessible for
inspection by representatives of the REIT or any Subsidiary at any time during
normal business hours. The Manager shall keep confidential any and all
information obtained in connection with the services rendered hereunder and
shall not disclose any such information to nonaffiliated third parties except
with the prior written consent of the Board of Directors.
SECTION 7. OBLIGATIONS OF MANAGER.
(a) The Manager shall require each seller or transferor of REIT
Investments to the Company to make such representations and warranties regarding
such REIT Investments as may, in the judgment of the Manager, be necessary and
appropriate. In addition, the Manager shall take such other action as it deems
necessary or appropriate with regard to the protection of the Company's
investments.
(b) The Manager shall refrain from any action that, in its sole
judgment made in good faith, would adversely affect the status of the REIT as a
REIT or that, in its sole judgment made in good faith, would violate any law,
rule or regulation of any governmental body or agency having jurisdiction over
the REIT or any Subsidiary or that would otherwise not be permitted by the
REIT's or Subsidiary's Governing Instruments. If the Manager is ordered to take
any such action by the Board of Directors, the Manager shall promptly notify the
Board of Directors of the Manager's judgment that such action would adversely
affect such status or violate any such law, rule or regulation or the Governing
Instruments. Notwithstanding the foregoing, the Manager, its directors,
officers, stockholders and employees shall not be liable to the REIT, any
Subsidiary, the Independent Directors, or the REIT's or a Subsidiary's
stockholders or partners for any act or
-5-
omission by the Manager, its directors, officers, stockholders or employees
except as provided in Section 11 of this Agreement.
SECTION 8. COMPENSATION.
(a) The REIT shall pay to the Manager, for services rendered under
this Agreement, a quarterly base management fee in an amount equal to 1/4 of 1%
of the Average Invested Assets of the Company during each fiscal quarter (pro
rata amount based on the number of days elapsed during any partial fiscal
quarter), commencing with the first fiscal quarter after the Closing Date.
(b) The Manager shall be entitled to receive incentive
compensation for each fiscal quarter in an amount equal to the product of (A)
25% of the dollar amount by which (1)(a) Funds from Operations (before the
incentive fee but after the base management fee) of the Company per share of
Common Stock (based on the weighted average number of shares) (b) plus gains (or
minus losses) from debt restructuring and sales of property per share of Common
Stock (based on the weighted average number of shares), exceed (2) an amount
equal to (a) the weighted average of the price per share at the initial offering
and the prices per share at any secondary offerings by the Company multiplied by
(b) the Ten-Year U.S. Treasury Rate plus five percent per annum multiplied by
(B) the weighted average number of shares of Common Stock outstanding during
such period. "Funds from Operations" shall be computed in accordance with the
definition thereof adopted by the National Association of Real Estate Investment
Trusts ("NAREIT") and shall mean net income (computed in accordance with GAAP)
excluding gains (or losses) from debt restructuring and sales of property, plus
depreciation and amortization on real estate assets, and after adjustments for
unconsolidated partnerships and joint ventures. As used in calculating the
Manager's compensation, the term "Ten Year U.S. Treasury Rate" means the
arithmetic average of the weekly average yield to maturity for actively traded
current coupon U.S. Treasury fixed interest rate securities (adjusted to
constant maturities of ten years) published by the Federal Reserve Board during
a quarter, or, if such rate is not published by the Federal Reserve Board, any
Federal Reserve Bank or agency or department of the federal government selected
by the Company. If the Company determines in good faith that the Ten Year U.S.
Treasury Rate cannot be calculated as provided above, then the rate shall be the
arithmetic average of the per annum average yields to maturities, based upon
closing asked prices on each business day during a quarter, for each actively
traded marketable U.S. Treasury fixed interest rate security with a final
maturity date not less than eight nor more than twelve years from the date of
the closing asked prices as chosen and quoted for each business day in each such
quarter in New York City by at least three recognized dealers in U.S. government
securities selected by the Company.
(c) The Manager shall compute the compensation payable under
Sections 8(a) and 8(b) of this Agreement within 45 days after the end of each
fiscal quarter. A copy of the computations made by the Manager to calculate its
compensation shall thereafter promptly be delivered to the Board of Directors
and, upon such delivery, payment of the compensation earned under Sections 8(a)
and 8(b) of this Agreement shown therein shall be due and payable within 60 days
after the end of such fiscal quarter.
-6-
(d) The Manager may charge the Company for any out of pocket
expenses that the Manager incurs in connection with any due diligence on assets
considered for purchase by the Company. Moreover, the Manager shall document the
time spent by the Manager's employees in performing such due diligence and shall
be entitled to reimbursement for the allocable portion of such employees'
salaries and benefits.
SECTION 9. EXPENSES OF THE COMPANY. The Company or any Subsidiary
shall pay all of its expenses and shall reimburse the Manager for documented
expenses of the Manager incurred on its behalf.
SECTION 10. CALCULATIONS OF EXPENSES. Expenses incurred by the Manager
on behalf of the Company shall be reimbursed quarterly to the Manager within 60
days after the end of each quarter. The Manager shall prepare a statement
documenting the expenses of the Company and those incurred by the Manager on
behalf of the Company during each quarter, and shall deliver such statement to
the Company within 45 days after the end of each quarter.
SECTION 11. LIMITS OF MANAGER RESPONSIBILITY. The Manager assumes no
responsibility under this Agreement other than to render the services called for
hereunder in good faith and shall not be responsible for any action of the Board
of Directors in following or declining to follow any advice or recommendations
of the Manager, including as set forth in Section 7(b) of this Agreement. The
Manager, its directors, officers, stockholders and employees will not be liable
to the Company, any Subsidiary, the Independent Directors or the Company's or
any Subsidiary's stockholders or partners for any acts or omissions by the
Manager, its directors, officers, stockholders or employees under or in
connection with this Agreement, except by reason of acts constituting bad faith,
willful misconduct, gross negligence or reckless disregard of their duties. The
Company or a Subsidiary shall reimburse, indemnify and hold harmless the
Manager, its stockholders, directors, officers and employees of and from any and
all expenses, losses, damages, liabilities, demands, charges and claims of any
nature whatsoever, (including attorneys' fees) in respect of or arising from any
acts or omissions of the Manager, its stockholders, directors, officers and
employees made in good faith in the performance of the Manager's duties under
this Agreement and not constituting bad faith, willful misconduct, gross
negligence or reckless disregard of its duties.
SECTION 12. NO JOINT VENTURE. The Company and the Manager are not
partners or joint venturers with each other and nothing herein shall be
construed to make them such partners or joint venturers or impose any liability
as such on either of them.
SECTION 13. TERM; TERMINATION. This Agreement shall commence on the
Closing Date and shall continue in force until the second anniversary of the
Closing Date, and thereafter, it may be extended only with the consent of the
Manager and by the affirmative vote of a majority of the Board of Directors,
including a majority of the Independent Directors.
Each extension shall be executed in writing by the parties hereto
before the expiration of this Agreement or any extension thereof. Each such
extension shall not exceed twelve months.
-7-
Notwithstanding any other provision to the contrary, this Agreement, or
any extension hereof, may be terminated by the Company, upon 60 days' written
notice, by majority vote of the Independent Directors or by majority vote of the
Stockholders; provided that a termination fee, equal to the sum of the base
management fee and incentive management fee earned during the twelve months
preceding such termination, will be due.
If this Agreement is terminated pursuant to this Section 13, such
termination shall be without any further liability or obligation of either party
to the other, except as provided in Section 16 of this Agreement.
SECTION 14. ASSIGNMENTS.
(a) Except as set forth in Section 14(b) of this Agreement, this
Agreement shall terminate automatically in the event of its assignment, in whole
or in part, by the Manager, unless such assignment is consented to in writing by
the REIT with the consent of a majority of the Independent Directors. Any such
assignment shall bind the assignee hereunder in the same manner as the Manager
is bound. In addition, the assignee shall execute and deliver to the REIT a
counterpart of this Agreement naming such assignee as Manager. This Agreement
shall not be assigned by the REIT without the prior written consent of the
Manager, except in the case of assignment by the REIT to another REIT or other
organization which is a successor (by merger, consolidation or purchase of
assets) to the REIT, in which case such successor organization shall be bound
hereunder and by the terms of such assignment in the same manner as the REIT is
bound hereunder.
(b) Notwithstanding any provision of this Agreement, the Manager
may subcontract and assign any or all of its responsibilities under Sections
2(b), 2(c) and 2(d) of this Agreement to any of its Affiliates, and the REIT
hereby consents to any such assignment and subcontracting.
SECTION 15. TERMINATION BY REIT FOR CAUSE. At the option of the REIT,
this Agreement shall be and become terminated upon 60 days' written notice of
termination from the Board of Directors to the Manager, without payment of any
termination fee, if any of the following events shall occur:
(a) if the Manager shall violate any provision of this Agreement
and, after notice of such violation, shall not cure such violation within 30
days; or
(b) there is entered an order for relief or similar decree or
order with respect to the Manager by a court having competent jurisdiction in an
involuntary case under the federal bankruptcy laws as now or hereafter
constituted or under any applicable federal or state bankruptcy, insolvency or
other similar laws; or the Manager (i) ceases, or admits in writing its
inability to pay its debts as they become due and payable, or makes a general
assignment for the benefit of, or enters into any composition or arrangement
with, creditors; (ii) applies for, or consents (by admission of material
allegations of a petition or otherwise) to the appointment of a receiver,
trustee, assignee, custodian, liquidator or sequestrator (or other similar
official) of the Manager or of any substantial part of its properties or assets,
or authorizes such an application or consent, or proceedings seeking such
appointment are commenced without such authorization,
-8-
consent or application against the Manager and continue undismissed for 30 days;
(iii) authorizes or files a voluntary petition in bankruptcy, or applies for or
consents (by admission of material allegations of a petition or otherwise) to
the application of any bankruptcy, reorganization, arrangement, readjustment of
debt, insolvency, dissolution, liquidation or other similar law of any
jurisdiction, or authorizes such application or consent, or proceedings to such
end are instituted against the Manager without such authorization, application
or consent and are approved as properly instituted and remain undismissed for 30
days or result in adjudication of bankruptcy or insolvency; or (iv) permits or
suffers all or any substantial part of its properties or assets to be
sequestered or attached by court order and the order remains undismissed for 30
days.
(c) If any of the events specified in Section 15(b) of this
Agreement shall occur, the Manager shall give prompt written notice thereof to
the Board of Directors upon the happening of such event.
SECTION 16. ACTION UPON TERMINATION. From and after the effective date
of termination of this Agreement, pursuant to Sections 13, 14, or 15 of this
Agreement, the Manager shall not be entitled to compensation for further
services hereunder, but shall be paid all compensation accruing to the date of
termination and, if terminated pursuant to Section 13, the applicable
termination fee. Upon such termination, the Manager shall forthwith:
(a) after deducting any accrued compensation and reimbursement for
its expenses to which it is then entitled, pay over to the Company or a
Subsidiary all money collected and held for the account of the Company or a
Subsidiary pursuant to this Agreement;
(b) deliver to the Board of Directors a full accounting, including
a statement showing all payments collected by it and a statement of all money
held by it, covering the period following the date of the last accounting
furnished to the Board of Directors with respect to the Company or a Subsidiary;
and
(c) deliver to the Board of Directors all property and documents
of the Company or any Subsidiary then in the custody of the Manager.
SECTION 17. RELEASE OF MONEY OR OTHER PROPERTY UPON WRITTEN REQUEST.
The Manager agrees that any money or other property of the Company or Subsidiary
held by the Manager under this Agreement shall be held by the Manager as
custodian for the Company or Subsidiary, and the Manager's records shall be
appropriately marked clearly to reflect the ownership of such money or other
property by the Company or such Subsidiary. Upon the receipt by the Manager of a
written request signed by a duly authorized officer of the Company requesting
the Manager to release to the Company or any Subsidiary any money or other
property then held by the Manager for the account of the Company or any
Subsidiary under this Agreement, the Manager shall release such money or other
property to the Company or any Subsidiary within a reasonable period of time,
but in no event later than 60 days following such request. The Manager shall not
be liable to the Company, any Subsidiary, the Independent Directors, or the
Company's or a Subsidiary's stockholders or partners for any acts performed or
omissions to act by the Company or any Subsidiary in connection with the money
or other
-9-
property released to the Company or any Subsidiary in accordance with this
Section. The Company and any Subsidiary shall indemnify the Manager, its
directors, officers, stockholders and employees against any and all expenses,
losses, damages, liabilities, demands, charges and claims of any nature
whatsoever, which arise in connection with the Manager's release of such money
or other property to the Company or any Subsidiary in accordance with the terms
of this Section 17 of this Agreement. Indemnification pursuant to this provision
shall be in addition to any right of the Manager to indemnification under
Section 11 of this Agreement.
SECTION 18. REPRESENTATIONS AND WARRANTIES.
(a) The Company hereby represents and warrants to the Manager as
follows:
(i) The REIT is duly organized, validly existing and in
good standing under the laws of the jurisdiction of its incorporation,
has the corporate power to own its assets and to transact the business
in which it is now engaged and is duly qualified as a foreign
corporation and in good standing under the laws of each jurisdiction
where its ownership or lease of property or the conduct of its business
requires such qualification, except for failures to be so qualified,
authorized or licensed that could not in the aggregate have a material
adverse effect on the business operations, assets or financial
condition of the REIT and its subsidiaries, taken as a whole. The REIT
does not do business under any fictitious business name.
(ii) The REIT has the corporate power and authority to
execute, deliver and perform this Agreement and all obligations
required hereunder and has taken all necessary corporate action to
authorize this Agreement on the terms and conditions hereof and the
execution, delivery and performance of this Agreement and all
obligations required hereunder. No consent of any other person
including, without limitation, stockholders and creditors of the REIT,
and no license, permit, approval or authorization of, exemption by,
notice or report to, or registration, filing or declaration with, any
governmental authority is required by the REIT in connection with this
Agreement or the execution, delivery, performance, validity or
enforceability of this Agreement and all obligations required
hereunder. This Agreement has been, and each instrument or document
required hereunder will be, executed and delivered by a duly authorized
officer of the REIT, and this Agreement constitutes, and each
instrument or document required hereunder when executed and delivered
hereunder will constitute, the legally valid and binding obligation of
the REIT enforceable against the REIT in accordance with its terms.
(iii) The execution, delivery and performance of this
Agreement and the documents or instruments required hereunder will not
violate any provision of any existing law or regulation binding on the
REIT, or any order, judgment, award or decree of any court, arbitrator
or governmental authority binding on the REIT, or the Governing
Instruments of, or any securities issued by the REIT or of any
mortgage, indenture, lease, contract or other agreement, instrument or
undertaking to which the REIT is a party or by which the REIT or any of
its assets may be bound, the violation of which would have a material
adverse effect on the business operations, assets or financial
condition of the
-10-
REIT and its subsidiaries, taken as a whole, and will not result in, or
require, the creation or imposition of any lien on any of its property,
assets or revenues pursuant to the provisions of any such mortgage,
indenture, lease, contract or other agreement, instrument or
undertaking.
(b) The Manager hereby represents and warrants to the REIT as
follows:
(i) the Manager is duly organized, validly existing and in
good standing under the laws of the jurisdiction of its formation, has
the corporate power to own its assets and to transact the business in
which it is now engaged and is duly qualified to do business and is in
good standing under the laws of each jurisdiction where its ownership
or lease of property or the conduct of its business requires such
qualification, except for failures to be so qualified, authorized or
licensed that could not in the aggregate have a material adverse effect
on the business operations, assets or financial condition of the
Manager and its subsidiaries, taken as a whole. The Manager does not do
business under any fictitious business name.
(ii) The Manager has the corporate power and authority to
execute, deliver and perform this Agreement and all obligations
required hereunder and has taken all necessary partnership action to
authorize this Agreement on the terms and conditions hereof and the
execution, delivery and performance of this Agreement and all
obligations required hereunder. No consent of any other person
including, without limitation, partners and creditors of the Manager,
and no license, permit, approval or authorization of, exemption by,
notice or report to, or registration, filing or declaration with, any
governmental authority is required by the Manager in connection with
this Agreement or the execution, delivery, performance, validity or
enforceability of this Agreement and all obligations required
hereunder. This Agreement has been, and each instrument or document
required hereunder will be, executed and delivered by a duly authorized
agent of the Manager, and this Agreement constitutes, and each
instrument or document required hereunder when executed and delivered
hereunder will constitute, the legally valid and binding obligation of
the Manager enforceable against the Manager in accordance with its
terms.
(iii) The execution, delivery and performance of this
Agreement and the documents or instruments required hereunder, will not
violate any provision of any existing law or regulation binding on the
Manager, or any order, judgment, award or decree of any court,
arbitrator or governmental authority binding on the Manager, or the
partnership agreement of, or any securities issued by the Manager or of
any mortgage, indenture, lease, contract or other agreement, instrument
or undertaking to which the Manager is a party or by which the Manager
or any of its assets may be bound, the violation of which would have a
material adverse effect on the business operations, assets or financial
condition of the Manager and its subsidiaries, taken as a whole, and
will not result in, or require, the creation or imposition of any lien
on any of its property, assets or revenues pursuant to the provisions
of any such mortgage, indenture, lease, contract or other agreement,
instrument or undertaking.
-11-
SECTION 19. NOTICES. Unless expressly provided otherwise herein, all
notices, requests, demands and other communications required or permitted under
this Agreement shall be in writing and shall be deemed to have been duly given,
made and received when delivered against receipt or upon actual receipt of
registered or certified mail, postage prepaid, return receipt requested,
addressed as set forth below:
(a) If to the REIT:
Ocwen Asset Investment Corp.
The Forum, Suite 1000
0000 Xxxx Xxxxx Xxxxx Xxxx.
Xxxx Xxxx Xxxxx, XX 00000
Attention: Secretary
with a copy given in the manner prescribed above, to:
Xxxxxx X. Xxxxxx, III, Esquire
Hunton & Xxxxxxxx
000 Xxxx Xxxx Xxxxxx
Xxxxxxxx, Xxxxxxxx 00000-0000
(b) If to the Manager:
Ocwen Capital Corporation
The Forum, Suite 1000
0000 Xxxx Xxxxx Xxxxx Xxxx.
Xxxx Xxxx Xxxxx, XX 00000
Attention: Secretary
with a copy given in the manner prescribed above, to:
Xxxxxx X. Xxxxxx, III, Esquire
Hunton & Xxxxxxxx
000 Xxxx Xxxx Xxxxxx
Xxxxxxxx, Xxxxxxxx 00000-0000
Either party may alter the address to which communications or copies
are to be sent by giving notice of such change of address in conformity with the
provisions of this Section 19 for the giving of notice.
SECTION 20. BINDING NATURE OF AGREEMENT; SUCCESSORS AND ASSIGNS. This
Agreement shall be binding upon and inure to the benefit of the parties hereto
and their respective heirs, personal representatives, successors and assigns as
provided herein.
-12-
SECTION 21. ENTIRE AGREEMENT. This Agreement contains the entire
agreement and understanding among the parties hereto with respect to the subject
matter hereof, and supersedes all prior and contemporaneous agreements,
understandings, inducements and conditions, express or implied, oral or written,
of any nature whatsoever with respect to the subject matter hereof. The express
terms hereof control and supersede any course of performance and/or usage of the
trade inconsistent with any of the terms hereof. This Agreement may not be
modified or amended other than by an agreement in writing.
SECTION 22. CONTROLLING LAW. This Agreement and all questions relating
to its validity, interpretation, performance and enforcement shall be governed
by and construed, interpreted and enforced in accordance with the laws of the
Commonwealth of Virginia, notwithstanding any Virginia or other conflict-of-law
provisions to the contrary.
SECTION 23. INDULGENCES, NOT WAIVERS. Neither the failure nor any
delay on the part of a party to exercise any right, remedy, power or privilege
under this Agreement shall operate as a waiver thereof, nor shall any single or
partial exercise of any right, remedy, power or privilege preclude any other or
further exercise of the same or of any other right, remedy, power or privilege,
nor shall any waiver of any right, remedy, power or privilege with respect to
any occurrence be construed as a waiver of such right, remedy, power or
privilege with respect to any other occurrence. No waiver shall be effective
unless it is in writing and is signed by the party asserted to have granted such
waiver.
SECTION 24. COSTS AND EXPENSES. Each party hereto shall bear its own
costs and expenses (including the fees and disbursements of counsel and
accountants) incurred in connection with the negotiations and preparation of and
the closing under this Agreement, and all matters incident thereto.
SECTION 25. TITLES NOT TO AFFECT INTERPRETATION. The titles of
paragraphs and subparagraphs contained in this Agreement are for convenience
only, and they neither form a part of this Agreement nor are they to be used in
the construction or interpretation hereof.
SECTION 26. EXECUTION IN COUNTERPARTS. This Agreement may be executed
in any number of counterparts, each of which shall be deemed to be an original
as against any party whose signature appears thereon, and all of which shall
together constitute one and the same instrument. This Agreement shall become
binding when one or more counterparts hereof, individually or taken together,
shall bear the signatures of all of the parties reflected hereon as the
signatories.
SECTION 27. PROVISIONS SEPARABLE. The provisions of this Agreement are
independent of and separable from each other, and no provision shall be affected
or rendered invalid or unenforceable by virtue of the fact that for any reason
any other or others of them may be invalid or unenforceable in whole or in part.
SECTION 28. GENDER. Words used herein regardless of the number and
gender specifically used, shall be deemed and construed to include any other
number, singular or plural, and any other gender, masculine, feminine or neuter,
as the context requires.
-13-
SECTION 29. COMPUTATION OF INTEREST. Interest will be computed on the
basis of a 360-day year consisting of twelve months of thirty days each.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date first written above.
OCWEN ASSET INVESTMENT CORP.
By:
--------------------------------
Name:
------------------------------
Its:
-------------------------------
OCWEN CAPITAL CORPORATION
By:
--------------------------------
Name:
------------------------------
Its:
-------------------------------
-14-
