EXHIBIT 10.17
August 17, 2000
Supplement and Amendment to Annex 1-A of the Master Repurchase Agreement
This Supplement and Amendment to Annex 1-A of the Master Repurchase Agreement
(the "Supplement") entered into by and between the undersigned and dated as of
as of the 17th day of August, 2000 supplements and amends, and supersedes to the
extent inconsistent with, the terms of Annex 1-A of the Master Repurchase
Agreement ("Annex 1-A") entered into by and between the undersigned and dated as
of the 31st day of March, 2000. Except as otherwise amended herein, the
provisions of Annex 1-A shall apply to this Supplement. Capitalized terms not
otherwise defined herein shall have the meaning ascribed to them in Annex 1-A.
1. Amendments.
a) In Paragraph 1:
(i) delete "$100,000,000" from the definition of "Maximum Amount" and
insert "$150,000,000" in its place.
(ii) insert ""Minimum Acceleration Amount" shall equal $120,000,000."
after the definition of "Maximum Transfer Amount".
b) In the first sentence of Paragraph 18:
(i) delete "having, in the aggregate with all other Purchased CMBS
with respect to which there was an acceleration of the Term Repurchase
Date, Repurchase Prices not exceeding $10,000,000".
(ii) insert "if the early termination is pursuant to sub-clause (B) of
this sentence," after "provided that (i)" and before "Seller pays a
fee".
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(iii) delete "(aa) if the early termination is pursuant to sub-clause
(A) of this sentence, the Repurchase Prices of the affected Purchased
CMBS or (bb) if the early termination is pursuant to sub-clause (B) of
this sentence,".
(iv) insert "if the early termination is pursuant to sub-clause (A) of
this sentence, immediately after the transfer of the affected
Purchased CMBS and the payment of the related Repurchase Price, the
Amount of Transactions is not less that the Minimum Acceleration
Amount, (iii)" after "the Maximum Amount, (ii)" and before
"immediately after the transfer".
(v) delete "(iii)" and insert "(iv)" in its place.
c) In Paragraph 43, delete "$5,000,000" and insert "$7,500,000" in its
place.
2. Modification. This Supplement may not be amended nor any provision hereof
waived or modified except by an instrument in writing signed by the Buyer and
Seller.
3. Governing Law. This Supplement shall be governed by, and construed in
accordance with, the substantive laws of the State of New York without regard to
conflicts of law principles.
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IN WITNESS WHEREOF, the undersigned have executed this Supplement as of the date
set forth above.
Bear, Xxxxxxx & Co., Inc.
By: /s/ XXXX X. XXXXXXXX
---------------------------------
Xxxx X. Xxxxxxxx
Title: Senior Managing Director
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November 06, 2000
Bear, Xxxxxxx International Limited,
By: /s/ XXXX X. XXXXXXXX
---------------------------------
Xxxx X. Xxxxxxxx
Title: Director
------------------------------
November 06, 2000
LNR CMBS Holdings Corporation
By: /s/ XXXXXX XXXXX
---------------------------------
Xxxxxx Xxxxx
Title: Vice President
------------------------------
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PSA THE BOND MARKET
TRADE ASSOCIATION
MASTER REPURCHASE AGREEMENT
September 1996 Version
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Dated as of March 31, 2000
-------------------------
Between:
BEAR, XXXXXXX INTERNATIONAL LIMITED
-----------------------------------
and
LNR CMBS HOLDING CORP.
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1. Applicability.
From time to time the parties hereto may enter into transactions in which one
party ("Seller") agrees to transfer to the other ("Buyer") securities or other
assets ("Securities") against the transfer of funds by Buyer, with a
simultaneous agreement by Buyer to transfer to Seller such Securities at a date
certain or on demand, against the transfer of funds by Seller. Each such
transaction shall be referred to herein as a "Transaction" and, unless otherwise
agreed in writing, shall be governed by this Agreement, including any
supplemental terms or conditions contained in Annex I hereto and in any other
annexes identified herein or therein as applicable hereunder.
2. Definitions.
(a) "Act of Insolvency", with respect to any party, (i) the commencement by
such party as debtor of any case or proceeding under any bankruptcy,
insolvency, reorganization, liquidation, moratorium, dissolution,
delinquency, or similar law, or such party seeking the appointment or
election of a receiver, conservator, trustee, custodian or similar official
for such party or any substantial part of its property, or the convening of
any meeting of creditors for purposes of commencing any such case or
proceeding or seeking such an appointment or election, (ii) the
commencement of any such case or proceeding against such party, or another
seeking such an appointment or election, or the filing against a party of
an application for a protective decree under the provisions of the
Securities Investor Protection Act of 1970, which (A) is consented to or
not timely contested by such party, (B) results in the entry of an order
for relief, such an appointment or election, the issuance of such a
protective decree or the entry of an order having a similar effect, or (C)
is not dismissed within 15 days, (iii) the making by such party of a
general assignment for the benefit of creditors, or (iv) the admission in
writing by such party of such party's inability to pay such party's debts
as they become due;
(b) "Additional Purchased Securities", Securities provided by Seller to Buyer
pursuant to Paragraph 4(a) hereof;
(c) "Buyer's Margin Amount", with respect to any Transaction as of any date,
the amount obtained by application of the Buyer's Margin Percentage to the
Repurchase Price for such Transaction as of such date;
(d) "Buyer's Margin Percentage", with respect to any Transaction as of any
date, a percentage (which may be equal to the Seller's Margin Percentage)
agreed to by Buyer and Seller or, in the absence of any such agreement, the
percentage obtained by dividing the Market Value of the Purchased
Securities on the Purchase Date by the Purchase Price on the Purchase Date
for such Transaction;
(e) "Confirmation", the meaning specified in Paragraph 3(b) hereof;
(f) "Income", with respect to any Security at any time, any principal thereof
and all interest, dividends or other distributions thereon;
(g) "Margin Deficit", the meaning specified in Paragraph 4(a) hereof;
(h) "Margin Excess", the meaning specified in Paragraph 4(b) hereof;
(i) "Margin Notice Deadline", the time agreed to by the parties in the relevant
Confirmation, Annex I hereto or otherwise as the deadline for giving notice
requiring same-day satisfaction of margin maintenance obligations as
provided in Paragraph 4 hereof (or, in the absence of any such agreement,
the deadline for such purposes established in accordance with market
practice);
(j) "Market Value", with respect to any Securities as of any date, the price
for such Securities on such date obtained from a generally recognized
source agreed to by the parties or the most recent closing bid quotation
from such a source, plus
accrued income to the extent not included therein (other than any income
credited or transferred to, or applied to the obligations of, Seller
pursuant to Paragraph 5 hereof) as of such date (unless contrary to market
practice for such Securities);
(k) "Price Differential", with respect to any Transaction as of any date, the
aggregate amount obtained by daily application of the Pricing Rate for such
Transaction to the Purchase Price for such Transaction on a
360-day-per-year basis for the actual number of days during the period
commencing on (and including) the Purchase Date for such Transaction and
ending on (but excluding) the date of determination (reduced by any amount
of such Price Differential previously paid by Seller to Buyer with respect
to such Transaction);
(l) "Pricing Rate", the per annum percentage rate for determination of the
Price Differential;
(m) "Prime Rate", the prime rate of U.S. commercial banks as published in The
Wall Street Journal (or, if more than one such rate is published, the
average of such rates);
(n) "Purchase Date", the date on which Purchased Securities are transferred by
Seller to Buyer;
(o) "Purchase Price", (i) on the Purchase Date, the price at which Purchased
Securities are transferred by Seller to Buyer, and (ii) thereafter, except
where Buyer and Seller agree otherwise, such price increased by the amount
of any cash transferred by Buyer to Seller pursuant to Paragraph 4(b)
hereof and decreased by the amount of any cash transferred by Seller to
Buyer pursuant to Paragraph 4(a) hereof or applied to reduce Seller's
obligations under clause (ii) of Paragraph 5 hereof;
(p) "Purchased Securities", the Securities transferred by Seller to Buyer in a
Transaction hereunder, and any Securities substituted therefor in
accordance with Paragraph 9 hereof. The term "Purchased Securities" with
respect to any Transaction at any time also shall include Additional
Purchased Securities delivered pursuant to Paragraph 4(a) and shall exclude
Securities returned pursuant to Paragraph 4(b) hereof;
(q) "Repurchase Date", the date on which Seller is to repurchase the Purchased
Securities from Buyer, including any date determined by application of the
provisions of Paragraph 3(c) or 11 hereof;
(r) "Repurchase Price", the price at which Purchased Securities are to be
transferred from Buyer to Seller upon termination of a Transaction, which
will be determined in each case (including Transactions terminable upon
demand) as the sum of the Purchase Price and the Price Differential as of
the date of such determination;
(s) "Seller's Margin Amount", with respect to any Transaction as of any date,
the amount obtained by application of the Seller's Margin Percentage to the
Repurchase Price for such Transaction as of such date;
(t) "Seller's Margin Percentage", with respect to any Transaction as of any
date, a percentage (which may be equal to the Buyer's Margin Percentage)
agreed to by Buyer and Seller or, in the absence of any such agreement, the
percentage obtained by dividing the Market Value of the Purchased
Securities on the Purchase Date by the Purchase Price on the Purchase Date
for such Transaction.
3. Initiation; Confirmation; Termination.
(a) An agreement to enter into a Transaction may be made orally or in writing
at the initiation of either Buyer or Seller. On the Purchase Date for the
Transaction, the Purchased Securities shall be transferred to Buyer or its
agent against the transfer of the Purchase Price to an account of Seller.
(b) Upon agreeing to enter into a Transaction hereunder, Buyer or Seller (or
both), as shall be agreed, shall promptly deliver to the other party a
written confirmation of each Transaction (a "Confirmation"). The
Confirmation shall describe the Purchased Securities (including CUSIP
number, if any), identify Buyer and Seller and set forth (i) the Purchase
Date, (ii) the Purchase Price, (iii) the Repurchase Date, unless the
Transaction is to be terminable on demand, (iv) the Pricing Rate or
Repurchase Price applicable to the Transaction, and (v) any additional
terms or conditions of the Transaction not inconsistent with this
Agreement. The Confirmation, together with this Agreement, shall constitute
conclusive evidence of the terms agreed between Buyer and Seller with
respect to the Transaction to which the Confirmation relates, unless with
respect to the Confirmation specific objection is made promptly after
receipt thereof. In the event of any conflict between the terms of such
Confirmation and this Agreement, this Agreement shall prevail.
(c) In the case of Transactions terminable upon demand, such demand shall be
made by Buyer or Seller, no later than such time as is customary in
accordance with market practice, by telephone or otherwise on or prior to
the business day on which such termination will be effective. On the date
specified in such demand, or on the date fixed for termination in the case
of Transactions having a fixed term, termination of the Transaction will be
effected by transfer to Seller or its agent of the Purchased Securities and
any Income in respect thereof received by Buyer (and not previously
credited or transferred to, or applied to the obligations of, Seller
pursuant to Paragraph 5 hereof) against the transfer of the Repurchase
Price to an account of Buyer.
4. Margin Maintenance.
(a) If at any time the aggregate Market Value of all Purchased Securities
subject to all Transactions in which a particular party hereto is acting as
Buyer is less than the aggregate Buyer's Margin Amount for all such
Transactions (a "Margin Deficit"), then Buyer may by notice to Seller
require Seller in such Transactions, at Seller's option, to transfer to
Buyer cash or additional Securities reasonably acceptable to Buyer
("Additional Purchased Securities"), so that the cash and aggregate
Market Value of the Purchased Securities, including any such Additional
Purchased Securities, will thereupon equal or exceed such aggregate Buyer's
Margin Amount (decreased by the amount of any Margin Deficit as of such
date arising from any Transactions in which such Buyer is acting as
Seller).
(b) If at any time the aggregate Market Value of all Purchased Securities
subject to all Transactions in which a particular party hereto is acting as
Seller exceeds the aggregate Seller's Margin Amount for all such
Transactions at such time (a "Margin Excess"), then Seller may by notice to
Buyer require Buyer in such Transactions, at Buyer's option, to transfer
cash or Purchased Securities to Seller, so that the aggregate Market Value
of the Purchased Securities, after deduction of any such cash or any
Purchased Securities so transferred, will thereupon not exceed such
aggregate Seller's Margin Amount (increased by the amount of any Margin
Excess as of such date arising from any Transactions in which such Seller
is acting as Buyer).
(c) If any notice is given by Buyer or Seller under subparagraph (a) or (b) of
this Paragraph at or before the Margin Notice Deadline on any business day,
the party receiving such notice shall transfer cash or Additional Purchased
Securities as provided in such subparagraph no later than the close of
business in the relevant market on such day. If any such notice is given
after the Margin Notice Deadline, the party receiving such notice shall
transfer such cash or Securities no later than the close of business in the
relevant market on the next business day following such notice.
(d) Any cash transferred pursuant to this Paragraph shall be attributed to such
Transactions as shall be agreed upon by Buyer and Seller.
(e) Seller and Buyer may agree, with respect to any or all Transactions
hereunder, that the respective rights of Buyer or Seller (or both) under
subparagraphs (a) and (b) of this Paragraph may be exercised only where a
Margin Deficit or Margin Excess, as the case may be, exceeds a specified
dollar amount or a specified percentage of the Repurchase Prices for such
Transactions (which amount or percentage shall be agreed to by Buyer and
Seller prior to entering into any such Transactions).
(f) Seller and Buyer may agree, with respect to any or all Transactions
hereunder, that the respective rights of Buyer and Seller under
subparagraphs (a) and (b) of this Paragraph to require the elimination of a
Margin Deficit or a Margin Excess, as the case may be, may be exercised
whenever such a Margin Deficit or Margin Excess exists with respect to any
single Transaction hereunder (calculated without regard to any other
Transaction outstanding under this Agreement).
5. Income Payments.
Seller shall be entitled to receive an amount equal to all Income paid or
distributed on or in respect of the Securities that is not otherwise received by
Seller, to the full extent it would be so entitled if the Securities had not
been sold to Buyer. Buyer shall, as the parties may agree with respect to any
Transaction (or, in the absence of any such agreement, as Buyer shall reasonably
determine in its discretion), on the date such Income is paid or distributed
either (i) transfer to or credit to the account of Seller such Income with
respect to any Purchased Securities subject to such Transaction or (ii) with
respect to Income paid in cash, apply the Income payment or payments to reduce
the amount, if any, to be transferred to Buyer by Seller upon termination of
such Transaction. Buyer shall not be obligated to take any action pursuant to
the preceding sentence (A) to the extent that such action would result in the
creation of a Margin Deficit, unless prior thereto or simultaneously therewith
Seller transfers to Buyer cash or Additional Purchased Securities sufficient to
eliminate such Margin Deficit, or (B) if an Event of Default with respect to
Seller has occurred and is then continuing at the time such Income is paid or
distributed.
6. Security Interest.
Although the parties intend that all Transactions hereunder be sales and
purchases and not loans, in the event any such Transactions are deemed to be
loans, Seller shall be deemed to have pledged to Buyer as security for the
performance by Seller of its obligations under each such Transaction, and shall
be deemed to have granted to Buyer a security interest in, all of the Purchased
Securities with respect to all Transactions hereunder and all Income thereon and
other proceeds thereof.
7. Payment and Transfer.
Unless otherwise mutually agreed, all transfers of funds hereunder shall be in
immediately available funds. All Securities transferred by one party hereto to
the other party (i) shall be in suitable form for transfer or shall be
accompanied by duly executed instruments of transfer or assignment in blank and
such other documentation as the party receiving possession may reasonably
request, (ii) shall be transferred on the book-entry system of a Federal Reserve
Bank, or (iii) shall be transferred by any other method mutually acceptable to
Seller and Buyer.
8. Segregation of Purchased Securities.
To the extent required by applicable law, all Purchased Securities in the
possession of Seller shall be segregated from other securities in its possession
and shall be identified as subject to this Agreement. Segregation may be
accomplished by appropriate identification on the books and records of the
holder, including a financial or securities intermediary or a clearing
corporation. All of Seller's interest in the Purchased Securities shall pass to
Buyer on the Purchase Date and, unless otherwise agreed by Buyer and Seller,
nothing in this Agreement shall preclude Buyer from engaging in repurchase
transactions with the Purchased Securities or otherwise selling, transferring,
pledging or hypothecating the Purchased Securities, but no such transaction
shall relieve Buyer of its obligations to transfer Purchased Securities to
Seller pursuant to Paragraphs 3, 4 or 11 hereof, or of Buyer's obligation to
credit or pay income to, or apply income to the obligations of, Seller pursuant
to Paragraph 5 hereof.
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Required Disclosure for Transactions in Which the Seller Retains Custody of the
Purchased Securities
Seller is not permitted to substitute other securities for those subject to this
Agreement and therefore must keep Buyer's securities segregated at all times,
unless in this Agreement Buyer grants Seller the right to substitute other
securities. If Buyer grants the right to substitute, this means that Buyer's
securities will likely be commingled with Seller's own securities during the
trading day. Buyer is advised that, during any trading day that Buyer's
securities are commingled with Seller's securities, they [will]* [may]** be
subject to liens granted by Seller to [its clearing bank] [third parties] and
may be used by Seller for deliveries on other securities transactions. Whenever
the securities are commingled, Seller's ability to resegregate substitute
securities for Buyer will be subject to Seller's ability to satisfy [the
clearing] [any] lien or to obtain substitute securities.
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* Language to be used under 17 C.F.R. s.s.403.4(e) if Seller is a government
securities broker or dealer other than a financial institution.
** Language to be used under 17 C.F R. s.s.403.5(d) if Seller is a financial
institution.
9. Substitution.
(a) Seller may, subject to agreement with and acceptance by Buyer, substitute
other Securities for any Purchased Securities. Such substitution shall be
made by transfer to Buyer of such other Securities and transfer to Seller
of such Purchased Securities. After substitution, the substituted
Securities shall be deemed to be Purchased Securities.
(b) In Transactions in which the Seller retains custody of Purchased
Securities, the parties expressly agree that Buyer shall be deemed, for
purposes of subparagraph (a) of this Paragraph, to have agreed to and
accepted in this Agreement substitution by Seller of other Securities for
Purchased Securities; provided, however, that such other Securities shall
have a Market Value at least equal to the Market Value of the Purchased
Securities for which they are substituted.
10. Representations.
Each of Buyer and Seller represents and warrants to the other that (i) it is
duly authorized to execute and deliver this Agreement, to enter into the
Transactions contemplated hereunder and to perform its obligations hereunder and
has taken all necessary action to authorize such execution, delivery and
performance, (ii) it will engage in such Transactions as principal (or, if
agreed in writing, in the form of an annex hereto or otherwise, in advance of
any Transaction by the other party hereto, as agent for a disclosed principal),
(iii) the person signing this Agreement on its behalf is duly authorized to do
so on its behalf (or on behalf of any such disclosed principal), (iv) it has
obtained all authorizations of any governmental body required in connection with
this Agreement and the Transactions hereunder and such authorizations are in
full force and effect and (v) the execution, delivery and performance of this
Agreement and the Transactions hereunder will not violate any law, ordinance,
charter, by-law or rule applicable to it or any agreement by which it is bound
or by which any of its assets are affected. On the Purchase Date for any
Transaction Buyer and Seller shall each be deemed to repeat all the foregoing
representations made by it.
11. Events of Default.
In the event that (i) Seller fails to transfer or Buyer fails to purchase
Purchased Securities upon the applicable Repurchase Date, (ii) Seller or Buyer
fails to transfer Purchased Securities upon the applicable Repurchase Date,
(iii) Seller or Buyer fails to comply with Paragraph 4 hereof, (iv) Buyer fails,
after one business day's notice, to comply with Paragraph 5 hereof, (v) an Act
of Insolvency occurs with respect to Seller or Buyer, (vi) any representation
made by Seller or Buyer shall have been incorrect or untrue in any material
respect when made or repeated or deemed to have been made or repeated, or (vii)
Seller or Buyer shall admit to the other its inability to, or its intention not
to, perform any of its obligations hereunder (each an "Event of Default"):
(a) The nondefaulting party may, at its option (which option shall be deemed to
have been exercised immediately upon the occurrence of an Act of
Insolvency), declare an Event of Default to have occurred hereunder and,
upon the exercise or deemed exercise of such option, the Repurchase Date
for each Transaction hereunder shall, if it has not already occurred, be
deemed immediately to occur (except that, in the event that the Purchase
Date for any Transaction has not yet occurred as of the date of such
exercise or deemed exercise, such Transaction shall be deemed immediately
canceled. The non defaulting party shall (except upon the occurrence of an
Act of Insolvency) give notice to the defaulting party of the exercise of
such option as promptly as practicable.
(b) In all Transactions in which the defaulting party is acting as Seller, if
the nondefaulting party exercises or is deemed to have exercised the option
referred to in subparagraph (a) of this Paragraph, (i) the defaulting
party's obligations in such Transactions to repurchase all Purchased
Securities, at the Repurchase Price therefore on the Repurchase Date
determined in accordance with subparagraph (a) of this Paragraph, shall
thereupon become immediately due and payable, (ii) all Income paid after
such exercise or deemed exercise shall be retained by the nondefaulting
party and applied to the aggregate unpaid Repurchase Prices and any other
amounts owing by the defaulting party hereunder, and (iii) the defaulting
party shall immediately deliver to the nondefaulting party any Purchased
Securities subject to such Transactions then in the defaulting party's
possession or control.
(c) In all Transactions in which the defaulting party is acting as Buyer, upon
tender by the nondefaulting party of payment of the aggregate Repurchase
Prices for all such Transactions, all right, title and interest in and
entitlement to all Purchased Securities subject to such Transactions shall
be deemed transferred to the nondefaulting party, and the defaulting party
shall deliver all such Purchased Securities to the nondefaulting party.
(d) If the non defaulting party exercises or is deemed to have exercised the
option referred to in subparagraph (a) of this paragraph, the nondefaulting
party, without prior notice to the defaulting party, may:
(i) as to Transactions in which the defaulting party is acting as Seller,
(A) immediately sell, in a recognized market (or otherwise in a
commercially reasonable manner) at such price or prices as the
nondefaulting party may reasonably deem satisfactory, any or all
Purchased Securities subject to such Transactions and apply the
proceeds thereof to the aggregate unpaid Repurchase Prices and any
other amounts owing by the defaulting party hereunder or (B) in its
sole discretion elect, in lieu of selling all or a portion of such
Purchased Securities, to give the defaulting party credit for such
Purchased Securities in an amount equal to the price therefor on such
date, obtained from a generally recognized source or the most recent
closing bid quotation from such a source, against the aggregate unpaid
Repurchase Prices and any other amounts owing by the defaulting party
hereunder; and
(ii) as to Transactions in which the defaulting party is acting as Buyer,
(A) immediately purchase, in a recognized market (or otherwise in a
commercially reasonable manner) at such price or prices as the
nondefaulting party may reasonably deem satisfactory, securities
("Replacement Securities") of the same class and amount as any
Purchased Securities that are not delivered by the defaulting party to
the nondefaulting party as required hereunder or (B) in its sole
discretion elect, in lieu of purchasing Replacement Securities, to be
deemed to have purchased Replacement Securities at the price therefor
on such date, obtained from a generally recognized source or the most
recent closing bid quotation from such a source.
Unless otherwise provided in Annex I, the parties acknowledge and
agree that (1) the Securities subject to any Transaction hereunder are
instruments traded in a recognized market, (2) in the absence of a
generally recognized source for prices or bid or offer quotations for
any Security, the nondefaulting party may establish the source
therefor in its sole discretion and (3) all prices, bids and offers
shall be determined together with accrued Income (except to the extent
contrary to market practice with respect to the relevant Securities.
(e) As to Transactions in which the defaulting party is acting as Buyer, the
defaulting party shall be liable to the nondefaulting party for any excess
of the price paid (or deemed paid) by the nondefaulting party for
Replacement Securities over the Repurchase Price for the Purchased
Securities replaced thereby and for any amounts payable by the defaulting
party under Paragraph 5 hereof or otherwise hereunder.
(f) For purposes of this Paragraph 11, the Repurchase Price for each
Transaction hereunder in respect of which the defaulting party is acting as
Buyer shall not increase above the amount of such Repurchase Price for such
Transaction determined as of the date of the exercise or deemed exercise by
the nondefaulting party of the option referred to in subparagraph (a) of
this Paragraph.
(g) The defaulting party shall be liable to the nondefaulting party for (i) the
amount of all reasonable legal or other expenses incurred by the
nondefaulting party in connection with or as a result of an Event of
Default, (ii) damages in an amount equal to the cost (including all fees,
expenses and commissions) of entering into replacement transactions and
entering into or terminating hedge transactions in connection with or as a
result of an Event of Default, and (iii) any other loss damage, cost or
expense directly arising or resulting from the occurrence of an Event of
Default in respect of a Transaction.
(h) To the extent permitted by applicable law, the defaulting party shall be
liable to the nondefaulting arty for interest on any amounts owing by the
defaulting party hereunder, from the date the defaulting party becomes
liable for such amounts hereunder until such amounts are (I) paid in full
by the defaulting party or (ii) satisfied in full by the exercise of the
nondefaulting party's rights hereunder. Interest on any sum payable by the
defaulting party to the nondefaulting party under this Paragraph 11 (h)
shall be at a rate equal to the greater of the Pricing Rate for the
relevant Transaction or the Prime Rate.
(i) The nondefaulting party shall have, in addition to its rights hereunder,
any rights otherwise available to it under any other agreement or
applicable law.
12. Single Agreement.
Buyer and Seller acknowledge that, and have entered hereinto and will enter into
each Transaction hereunder in consideration of and in reliance upon the fact
that, all Transactions hereunder constitute a single business and contractual
relationship and have been made in consideration of each other. Accordingly,
each of Buyer and Seller agrees (i) to perform all of its obligations in respect
of each Transaction hereunder, and that a default in the performance of any such
obligations shall constitute a default by it in respect of all Transactions
hereunder, (ii) that each of them shall be entitled to set off claims and apply
property held by them in respect of any Transaction against obligations owing to
them in respect of any other Transactions hereunder and (iii) that payments,
deliveries and other transfers made by either of them in respect of any
Transaction shall be deemed to have been made in consideration of payments,
deliveries and other transfers in respect of any other Transactions hereunder,
and the obligations to make any such payments, deliveries and other transfers
may be applied against each other and netted.
13. Notices and Other Communications.
Any and all notices, statements, demands or other communications hereunder may
be given by a party to the other by mail, facsimile, telegraph, messenger or
otherwise to the address specified in Annex II hereto, or so sent to such party
at any other
place specified in a notice of change of address hereafter received by the
other. All notices, demands and request hereunder may be made orally, to be
confirmed promptly in writing, or by other communication as specified the
preceding sentence.
14. Entire Agreement; Severability.
This Agreement shall supersede any existing agreements between the parties
containing general terms and conditions for repurchase transactions. Each
provision and agreement herein shall be treated as separate and independent from
any other provision or agreement herein and shall be enforceable notwithstanding
the unenforceability of any such other provision or agreement.
15. Non-assignability; Termination.
(a) The rights and obligations of the parties under this Agreement and under
any Transaction shall not be assigned by either party without the prior
written consent of the other party, and any such assignment without the
prior written consent of the other party shall be null and void. Subject to
the foregoing, this Agreement and any Transactions shall be binding upon
and shall inure to the benefit of the parties and their respective
successors and assigns. This Agreement may be terminated by either party
upon giving written notice to the other, except that this Agreement shall,
notwithstanding such notice, remain applicable to any Transactions then
outstanding.
(b) Subparagraph (a) of this Paragraph 15 shall not preclude a party from
assigning, charging or otherwise dealing with all or any part of its
interest in any sum payable to it under Paragraph 11 hereof.
16. Governing Law.
This Agreement shall be governed by the laws of the State of New York without
giving effect to the conflict of law principles thereof.
17. No Waivers, Etc.
No express or implied waiver of any Event of Default by either party shall
constitute a waiver of any other Event of Default and no exercise of any remedy
hereunder by any party shall constitute a waiver of its right to exercise any
other remedy hereunder. No modification or waiver of any provision of this
Agreement and no consent by any party to a departure herefrom shall be effective
unless and until such shall be in writing and duly executed by both of the
parties hereto. Without limitation on any of the foregoing, the failure to give
a notice pursuant to subparagraphs 4(a) or 4(b) hereof will not constitute a
waiver of any right to do so at a later date.
18. Use of Employee Plan Assets.
(a) If assets of an employee benefit plan subject to any provision of the
Employee Retirement Income Security Act of 1974 ("ERISA") are intended to
be used by either party hereto (the "Plan Party") in a Transaction, the
Plan Party shall so notify the other party prior to the Transaction. The
Plan Party shall represent in writing to the other party that the
Transaction does not constitute a prohibited transaction under ERISA or is
otherwise exempt therefrom, and the other party may proceed in reliance
thereon but shall not be required so to proceed.
(b) Subject to the last sentence of subparagraph (a) of this Paragraph, any
such Transaction shall proceed only if Seller furnishes or has furnished to
Buyer its most recent available audited statement of its financial
condition and its most recent subsequent unaudited statement of its
financial condition.
(c) By entering into a Transaction pursuant to this Paragraph, Seller shall be
deemed (i) to represent to Buyer that since the date of Seller's latest
such financial statements, there has been no material adverse change in
Seller's financial condition which Seller has not disclosed to Buyer, and
(ii) to agree to provide Buyer with future audited and unaudited statements
of its financial condition as they are issued, so long as it is a Seller in
any outstanding Transaction involving a Plan Party.
19. Intent.
(a) The parties recognize that each Transaction is a "repurchase agreement" as
that term is defined in Section 101 of Title 11 of the United States Code,
as amended (except insofar as the type of Securities subject to such
Transaction or the term of such Transaction would render such definition
inapplicable), and a "securities contract" as that term is defined in
Section 741 of Title 11 of the United States Code, as amended (except
insofar as the type of assets subject to such Transaction would render such
definition inapplicable).
(b) It is understood that either party's right to liquidate Securities
delivered to it in connection with Transactions hereunder or to exercise
any other remedies pursuant to Paragraph 11 hereof is a contractual right
to liquidate such Transaction as described in Sections 555 and 559 of Title
11 of the United States Code, as amended.
(c) The parties agree and acknowledge that if a party hereto is an "insured
depository institution,", as such term is defined the Federal Deposit
Insurance Act, as amended ("FDIA"), then each Transaction hereunder is a
"qualified financial contract," as that term is defined in FDIA and any
rules, orders or policy statements thereunder (except insofar as the type
of assets subject to such Transaction would render such definition
inapplicable).
(d) It is understood that this Agreement constitutes a "netting contracts as
defined in and subject to Title IV of the Federal Deposit Insurance
Corporation Improvement Act of 1991 ("FDICIA") and each payment entitlement
and payment obligation under any Transaction hereunder shall constitute a
"covered contractual payment entitlement" or "covered
contractual payment obligation", respectively, as defined in and subject to
FDICIA (except insofar as one or both of the parties is not a Financial
institutions as that term is defined in FDICIA).
20. Disclosure Relating to Certain Federal Protections.
The parties acknowledge that they have been advised that:
(a) in the case of Transactions in which one of the parties is a broker or
dealer registered with the Securities and Exchange Commission ("SEC") under
Section 15 of the Securities Exchange Act of 1934 ("1934 Act"), the
Securities Investor Protection Corporation has taken the position that the
provisions of the Securities Investor Protection Act of 1970 ("SIPA") do
not protect the other party with respect to any Transaction hereunder;
(b) in the case of Transactions in which one of the parties is a government
securities broker or a government securities dealer registered with the SEC
under Section 15C of the 1934 Act, SIPA will not provide protection to the
other party with respect to any Transaction hereunder; and
(c) in the case of Transactions in which one of the parties is a financial
institution, funds held by the financial institution pursuant to a
Transaction hereunder are not a deposit and therefore are not insured by
the Federal Deposit Insurance Corporation, the Federal Savings and Loan
Insurance Corporation or the National Credit Union Share Insurance Fund, as
applicable.
BEAR, XXXXXXX INTERNATIONAL LIMITED, LNR CMBS Holdings Corporation
By: /s/ XXXX X. XXXXXXXX By: /s/ XXXXXX XXXXX
-------------------------------- --------------------------------
Xxxx X. Xxxxxxxx Xxxxxx Xxxxx
Title: Director Title: Vice President
----------------------------- -----------------------------
Date: November 06, 2000 Date: 4/14/00
------------------------------ ------------------------------
ANNEX I
Supplemental Terms and Conditions
This Annex I forms a part of the Master Repurchase Agreement (September 1996
Version) dated as of March 31, 1999 (the "Agreement") between BEAR XXXXXXX
INTERNATIONAL LIMITED ("Bear Xxxxxxx") and LNR CMBS Holdings Corporation
("Counterparty"). Capitalized terms used but not defined in this Annex I shall
have the meanings ascribed to them in the Agreement.
l. Please initial in the space provided to select any/all of the optional
Annexes listed below to form a part of the Agreement. The Annexes which are
initialed will apply hereunder.
Initials
(a) Annex III (International Transactions) ________
(b) Annex IV (Party Acting as Agent) ________
(c) Annex V (Margin for Forward Transactions ) ________
(d) Annex VI (Buy/Sell Back Transactions) ________
(e) Annex VII (Transactions Involving Registered
Investment Companies) ________
2. "Margin Notice Deadline" means 10:00 a.m. New York time.
3. The definition of "Market Value" in Paragraph 2(j) shall be replaced with
the following:
"Market Value", with respect to any Securities as of any date, the
price for such Securities on such date as determined by Bear Xxxxxxx,
in its sole discretion, plus accrued Income to the extent not included
therein (other than any Income credited or transferred to, or applied
to the obligations of, Seller pursuant to Paragraph 5 hereof) as of
such date (unless contrary to market practice for such Securities).
4. The term "Transaction" includes any repurchase or reverse repurchase
transaction outstanding on the date hereof.
5. (a) The first sentence of Paragraph 3(c) is hereby replaced with the
following: "In the case of Transactions terminable upon demand, such demand
shall be made by Buyer or Seller, by telephone or otherwise on a business
day of the recipient of the demand. Unless a later time is specified in the
demand, if such demand is made prior to 10:00 a.m. New York time,
termination shall be effective at 3:00 p.m. New York time on the day demand
is made; if such demand is made after 10:00 a.m. New York time, termination
shall be effective at 9:00 a.m. New York time on the next business day of
the recipient of the demand. After such demand, another later time may be
agreed to by Buyer and Seller if confirmed in writing by both. Bear Xxxxxxx
shall have the right to specify in a demand an earlier time than aforesaid
that termination is to be effected if reasonable under the circumstances
(as, for example, and not by way of limitation, in periods of increased
market volatility or illiquidity of securities). Such demand shall be
deemed given after Bear Xxxxxxx telephones Xxxxxx Xxxxxx at 000-000-0000 or
a substitute (each, a "Counterparty Authorized Representative"), who may be
designated in writing addressed to Bear Xxxxxxx at 000 Xxxx Xxxxxx, 0xx
Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Senior Managing Director,
Finance Desk.
(b) The second sentence of Paragraph 3(c) is hereby amended by replacing
the words "On the date specified in such demand" with the words "At the
time specified in such demand (or such later time as agreed to in
writing)".
6. Demands by Bear Xxxxxxx for the delivery or return of cash or Additional
Purchased Securities pursuant to Paragraphs 4(a) may be oral and need not
be confirmed in writing.
7. Notwithstanding the definition of Purchase Price in Paragraph 2 of the
Agreement and the provisions of Paragraph 4 of the Agreement, the parties
agree that (i) except as provided in Paragraph 6, 11 and 13 of Annex 1-A,
the Purchase Price will not be increased or decreased by the amount of any
cash transferred by one party to the other pursuant to Paragraph 4 of the
Agreement and (ii) transfer of such cash shall be treated, as if it
constituted a transfer of Securities (with a Market Value equal to the U.S.
dollar amount of such cash) pursuant to Paragraph 4(a) (including for
purposes of the definition of "Additional Purchased Securities.")
8. The following 2 paragraphs shall be added to Paragraph 9 of the Agreement:
(c) In the case of any Transaction for which the Repurchase Date is other
than the business day immediately following the Purchase Date and with
respect to which Seller does not have any existing right to substitute
substantially the same Securities for the Purchased Securities, Seller
shall have the right, subject to the proviso to this sentence, upon notice
to Buyer, which notice shall be given at or prior to 10 a.m. (New York
time) on such business day, to substitute substantially the same Securities
for any Purchased Securities; provided, however, that Buyer may elect, by
the close of business on the business day notice is received, or by the
close of the next business day if notice is given after 10 a.m. (New York
time) on such day, not to accept such substitution. In the event such
substitution is accepted by Buyer, such substitution shall be made by
Seller's transfer to Buyer of such other Securities and Buyer's transfer to
Seller of such Purchased Securities, and after such substitution, the
substituted Securities shall be deemed to be Purchased Securities. In the
event Buyer elects not to accept such substitution, Buyer shall offer
Seller the right to terminate the Transaction.
(d) In the event Seller exercises its right to substitute or terminate
under sub-paragraph (c), Seller shall be obligated to pay to Buyer, by the
close of the business day of such substitution or termination, as the case
may be, an amount equal to (A) Buyer's actual cost (including all fees,
expenses and commissions) of (i) entering into replacement transactions;
(ii) entering into or terminating hedge transactions; and/or (iii)
terminating transactions or substituting securities in like transactions
with third parties in connection with or as a result of such substitution
or termination, and (B) to the extent Buyer determines not to enter into
replacement transactions, the loss incurred by Buyer directly arising or
resulting from such substitution or termination. The foregoing amounts
shall be solely determined and calculated by Buyer in good faith.
9. The parties acknowledge and agree that (a) any Securities subject to any
Transaction, including privately placed securities, may be sold under
Paragraph 11 in a private sale, which shall be deemed commercially
reasonable and (b) in any sale pursuant to Paragraph 11, Bear Xxxxxxx shall
have the right to purchase the Securities.
10. The words "obtained from a generally recognized source or the most recent
closing bid quotation from such a source" in Paragraph 11(d)(i)(B), shall
be replaced with the words "determined by Bear Xxxxxxx, in its sole
discretion".
11. Bear Xxxxxxx shall have no obligation to release any monies or Purchased
CMBS to Counterparty with respect to any Transaction unless and until all
Transactions are adequately margined pursuant to the terms of the
Agreement.
Bear Xxxxxxx International Limited LNR CMBS Holdings Corporation
By: /s/ XXXX X. XXXXXXXX By: /s/ XXXXXX XXXXX
------------------------------- --------------------------
Name: Xxxx X. Xxxxxxxx Name: Xxxxxx Xxxxx
Title: Director Title: Vice President
Date: November 6, 2000
ANNEX I-A
This Annex I-A forms a part of the Master Repurchase Agreement dated as of March
31, 2000 (the "Repurchase Agreement") between BEAR, XXXXXXX INTERNATIONAL
LIMITED ("Buyer") and LNR CMBS Holdings Corporation (the "Seller" or "Hedging
Party"). This Annex I-A shall apply to Transactions in which Bear Xxxxxxx
International Limited is or will be the Buyer of certain subordinated commercial
mortgage-backed securities ("CMBS") issued with respect to pools of commercial
mortgage loans, which pools qualify under sections 860A through 860G of the
Internal Revenue Code as real estate mortgage investment conduits ("REMIC"),
from Seller in accordance with the terms described below (each, a "CMBS
Transaction"). For the avoidance of doubt, all CMBS Transactions between Seller
and Buyer will be subject to the Repurchase Agreement, Annex I, this Annex I-A,
each confirmation under the Repurchase Agreement (collectively, the "Agreement")
and the Institutional Account Agreement dated as of March 31, 2000 between Buyer
and Seller (the "Institutional Account Agreement") and each Purchased CMBS shall
constitute a Purchased Security under this Agreement. If there is any
inconsistency between the Repurchase Agreement, a confirmation under the
Repurchase Agreement, Annex I and this Annex I-A, this Annex I-A shall control.
Each CMBS Transaction shall constitute a sale by Seller to Buyer of the related
CMBS. As used in this Agreement "BSCO Repurchase Agreement" means that Master
Repurchase Agreement dated as of March 31, 2000 between Bear, Xxxxxxx & Co. Inc.
("BSCO") and Seller and all Annexes and Schedules thereto except as expressly
modified herein. All other capitalized terms not herein defined shall have the
meanings set forth in the BSCO Repurchase Agreement and/or the Agreement, as
applicable.
1. Definitions.
"Affirmative Control" shall mean, with respect to any Purchased CMBS, the
unilateral ability of the holder of any Related Purchased CMBS to exercise
the rights of the Controlling Class, or, if the related CMBS Transaction
does not provide for a Controlling Class, to unilaterally appoint, retain
or remove the CMBS Transaction's special servicer.
"Amount of Transactions" shall mean the aggregate amount of all "Purchase
Prices" paid by any Bear Xxxxxxx entity for all repurchase transactions
involving commercial mortgage backed securities, including the outstanding
CMBS Transactions hereunder, and not repaid to Buyer, and all outstanding
CMBS Transactions, if any, with any other Bear Xxxxxxx entity.
"Business Day" shall mean each day on which BSCO is open for business.
"Buyer's Base Margin Ratio" shall equal, with respect to any Purchased
CMBS, the Buyer's Base Margin Ratio set forth on "Table Y" corresponding to
the applicable Purchased CMBS.
"Buyer's Margin Ratio" shall equal, with respect to any Purchased CMBS, (i)
the decimal equivalent of Buyer's Base Margin Ratio applicable to such
Purchased CMBS multiplied by (ii) the Concentration Adjustment Factor
applicable to such Purchased CMBS.
2
"Concentration Adjustment Factor" shall equal, with respect to any
Purchased CMBS, the Concentration Adjustment Factor set forth on "Table X"
corresponding to the Trust Concentration for such Purchased CMBS.
"Contiguous Affirmative Control" shall mean, with respect to any Purchased
CMBS, the ability of the holder of Related Purchased CMBS to exercise
Affirmative Control, without interruption, regardless of any change in the
Controlling Class or future reductions in the principal balance of the
Related Purchased CMBS, unless and until (i) only one Related Purchased
CMBS remains outstanding and (ii) such Related Purchased CMBS no longer
qualifies as the Controlling Class.
"Controlling Class" shall mean, with respect to each CMBS Transaction, the
class and minimum amount of CMBS certificates that vest the holder with the
unilateral right to appoint, retain or remove the transaction's special
servicer (and to otherwise exercise the rights of the controlling class,
however denominated in the issuing trust's governing documentation).
"Initial Base Purchase Price" shall equal, with respect to any Purchased
CMBS, the Initial Base Purchase Price set forth on "Table Y" corresponding
to the Initial Base Purchase Price for such Purchased CMBS.
"Initial Purchase Price" shall equal, with respect to any Purchased CMBS,
(i) the Initial Base Purchase Price applicable to such Purchased CMBS
multiplied by (ii) the Concentration Adjustment Factor applicable to such
Purchased CMBS multiplied by (iii) the Market Value of the Purchased CMBS
on the initial Purchase Date.
3
"LIBOR" shall mean the London interbank offered rate for one month US
Dollar deposits as quoted on Telerate Page 3750 at 8:30 am EST. Such rate
will be determined by Buyer at the time a CMBS Transaction is entered into.
LIBOR will be reset on a monthly basis on the 25th day of each month (or on
such other date as Buyer may specify in each Confirmation), or, if such day
is not a day on which banking institutions in London are generally open,
such rate for the next day on which banking institutions in London are
generally open thereafter.
"Margin Deficit" when referring to Transactions under this Agreement, shall
have the meaning specified in Paragraph 12 herein, and when referring to
Transactions under the BSCO Repurchase Agreement, shall equal, the amount,
at any time, that the Market Value of all Purchased Securities (as defined
therein) subject to all Transactions (as defined therein) exceeds the
aggregate Seller's Margin Amount (as defined therein) for all such
Transactions at such time.
"Maximum Amount" shall equal $100,000,000.
"Maximum BSCO Transfer Amount" shall mean an amount determined, from time
to time, by BSCO in its sole discretion.
"Maximum Transfer Amount" shall mean an amount determined, from time to
time, by Buyer in its sole discretion.
4
"Purchased CMBS" shall mean all CMBS transferred by Seller to Buyer in a
Transaction under the Agreement. The term "Purchased CMBS" with respect to
any Transaction also shall include CMBS delivered pursuant to Paragraph
4(a) of the Repurchase Agreement.
"Related CMBS" shall mean any CMBS issued by the issuing trust that issued
the Purchased CMBS.
"Related Hedge" shall mean any repurchase transaction between Seller and
BSCO or another affiliate of Buyer in which BSCO or such other affiliate of
Buyer is the seller of United States Treasury Securities to Seller.
"Related Purchased CMBS" shall mean, with respect to any Purchased CMBS,
any Related CMBS that are also Purchased CMBS (including the Purchased
CMBS).
"Termination Date" shall mean March 31, 2003.
"Trust Concentration" shall equal, with respect to any Purchased CMBS, the
percentage equivalent, rounded to the next highest whole percentage, of (i)
the sum of the most recent Market Value of all Related Purchased CMBS
divided by (ii) the sum of the most recent Market Value of all Purchased
CMBS.
[This space intentionally left blank]
5
Table X
Concentration
Trust Adjustment
Concentration Factor
----------------------------------------------------
less than or
equal to 1.0000
10.0%
----------------------------------------------------
11.0% 0.9985
----------------------------------------------------
12.0% 0.9938
----------------------------------------------------
13.0% 0.9862
----------------------------------------------------
14.0% 0.9754
----------------------------------------------------
15.0% 0.9615
----------------------------------------------------
16.0% 0.9446
----------------------------------------------------
17.0% 0.9246
----------------------------------------------------
18.0% 0.9015
----------------------------------------------------
19.0% 0.8754
----------------------------------------------------
20.0% 0.8462
----------------------------------------------------
21.0% 0.8138
----------------------------------------------------
22.0% 0.7785
----------------------------------------------------
23.0% 0.7400
----------------------------------------------------
24.0% 0.6985
----------------------------------------------------
25.0% 0.6538
----------------------------------------------------
26.0% 0.6062
----------------------------------------------------
27.0% 0.5554
----------------------------------------------------
28.0% 0.5015
----------------------------------------------------
29.0% 0.4446
----------------------------------------------------
30.0% 0.3846
----------------------------------------------------
31.0% 0.3215
----------------------------------------------------
32.0% 0.2554
----------------------------------------------------
33.0% 0.1862
----------------------------------------------------
34.0% 0.1138
----------------------------------------------------
35.0% 0.0385
----------------------------------------------------
greater
than 35.0% 0.0000
----------------------------------------------------
6
Table Y
Initial Base Buyer's Base
Ratings of CMBS* Pricing Rate Purchase Price Margin Ratio
---------------- --------------- -------------- ------------
BBB-/Baa3 and
higher LIBOR+ 150 bps 70% 75%
BB+/Bal LIBOR + 155 bps 65% 75%
BB/Ba2 LIBOR+ 165 bps 65% 75%
BB-/Ba3 LIBOR + 175 bps 65% 75%
B+/B1** LIBOR + 195 bps 50% 60%
B/B2 LIBOR + 210 bps 50% 60%
B-/B3 LIBOR + 225 bps 33% 43%
CCC/Caa LIBOR + 250 bps 25% 35%
Not Rated LIBOR + 250 bps 25% 35%
* Ratings as published by a nationally recognized statistical rating
organization on Purchased CMBS. In the event a rating on a particular
Purchased CMBS is changed, the Purchased CMBS shall be treated at the new
rating for all purposes (including Buyer's Base Margin Ratio, Buyer's
Margin Ratio and Pricing Rate, but excluding the Initial Base Purchase
Price and Initial Purchase Price) from the time of the change of the
rating. If more than one rating agency rates the Purchased CMBS, the lowest
of the ratings shall be the rating for the purposes of this Annex 1-A. If
either (i) no rating agency rates the Purchased CMBS or (ii) any rating
agency withdraws its rating of the Purchased CMBS, the terms listed for
"Not Rated" shall apply.
7
** Buyer will not enter into a Transaction with respect to a Purchased CMBS
whose rating is B+/B1 or lower unless the holder of such Purchased CMBS
would have Contiguous Affirmative Control or unless Buyer, at is sole
discretion, accepts a written assignment of certain control rights.
2. Buyer and Seller agree to enter into certain CMBS Transactions, subject to
the terms of the Agreement and the Institutional Account Agreement. Each
CMBS Transaction shall constitute a Transaction under the Repurchase
Agreement. The aggregate amount of such CMBS Transactions outstanding at
any time shall not exceed the Maximum Amount and no purchase by Buyer shall
be made after the Purchase Date of the first CMBS purchased hereunder
without the consent of Buyer, which it may withhold in its sole discretion.
The transfer of each Purchased CMBS to Buyer under this Agreement shall
constitute a separate Transaction and be subject to the terms and
conditions set forth in this Agreement.
3. Accrued Price Differentials incurred in connection with all CMBS
Transactions will be paid to Buyer on a monthly basis, on the date stated
as the Repurchase Date in the Confirmation with respect to such CMBS
Transaction (as same may be re-issued from time to time) or, if such day is
not a Business Day, the first Business Day thereafter.
4. All outstanding CMBS Transactions under the terms of this Annex I-A will be
repurchased by Seller on the Termination Date notwithstanding that a
Confirmation may state a Repurchase Date other than the Termination Date;
provided, however if Buyer, in
8
its sole discretion, enters into new CMBS Transactions (including, without
limitation, "rolling" any outstanding Transactions) after such date this
Agreement shall continue to control such Transactions. The Repurchase
Agreement is hereby amended to insert the word "Term" before "Repurchase
Date" each time "Repurchase Date" occurs in the Repurchase Agreement and to
delete section 2(q) and to substitute therefor the following:
(q) "Term Repurchase Date", the date on which Seller is to
repurchase the Purchased Securities from Buyer, including the
Termination Date set forth in Annex 1-A and any date determined by
application of the provisions of Paragraph 3(c) or 11 hereof;
5. On the Term Repurchase Date, all Repurchase Prices and other amounts owed
by Seller will be due and payable and Seller shall pay all such amounts as
provided herein.
6. Paragraph 4(b) of the Repurchase Agreement shall not apply to CMBS
Transactions. The Purchase Price of any Purchased CMBS shall not be
increased after the date of Buyer's purchase thereof with respect to any
subsequent CMBS Transaction involving such Purchased CMBS, except to the
extent of transfers of cash by Buyer to BSCO as provided herein.
7. Notwithstanding any provision to the contrary contained in any other
repurchase or other agreement, annexes or schedules thereto, with any other
"Bear Xxxxxxx entity" (as defined in the Institutional Account Agreement),
the Amount of Transactions shall not exceed, in the aggregate, the Maximum
Amount at any time. If the Amount of Transactions exceeds the Maximum
Amount, Seller shall repurchase sufficient Purchased CMBS to reduce the
Amount of Transactions to not greater than the Maximum Amount not later
than the first
9
Business Day after notice from Buyer (which date shall constitute a Term
Repurchase Date with respect to the Purchased CMBS to be repurchased
hereunder and for the purpose of Section 1 l(ii) of the Repurchase
Agreement).
8. [RESERVED]
9. Seller shall deliver to Buyer, in the case of physical securities, all of
the CMBS proposed to be purchased hereunder with fully executed transfer
documentation and, in the case of book entry CMBS, fully executed transfer
documentation, in either case in form sufficient to allow transfer and
registration of such Purchased CMBS to Buyer no later than the proposed
initial Purchase Date for the relevant CMBS. Seller shall deliver to Buyer
the related Prospectus or Private Placement Memorandum and Pooling and
Servicing Agreement at least two Business Days prior to Buyer's purchase.
Buyer shall have the right to cancel any Transaction and Seller agrees to
pay to Buyer any Purchase Price paid by Buyer plus any accrued Price
Differential within five Business Days of notice (which date shall
constitute a Term Repurchase Date for the purpose of Section ll(ii) of the
Repurchase Agreement) if a Trustee (in the case of physical Purchased CMBS)
and/or DTC (in the case of book entry Purchased CMBS) fails or refuses to
transfer or register the related Purchased CMBS into the name of Buyer.
10. Seller shall provide to Buyer, within two Business Days of receipt, any
written information received by Seller from the trustee or master servicer
for each issuing trust corresponding to each Purchased CMBS including,
without limitation, watch lists and
10
borrower or periodic summary property financial reports but excluding (i)
any periodic bond remittance reports that are otherwise available to Buyer
directly from the trustee and (ii) any loan files corresponding to loans
that have been transferred from the master servicer to the special servicer
(Seller shall make items (i) or (ii) available to Buyer upon Buyer's
request). Seller shall notify Buyer of any information, including, without
limitation, credit standing or performance of the underlying mortgage
loans, material correspondence, property level financial data or real
estate market information known to Seller that could materially affect the
market value of any Purchased CMBS. Seller shall make such notification
within three business days of Seller's receipt of such information (except,
in the case of information respecting the timing and amount of receipt of
loan payments, Seller shall make such notification no earlier than
permitted under the issuing trust's governing documentation). Seller's
asset management and credit surveillance staff shall be reasonably made
available to respond to periodic inquiries from Buyer regarding the status
of the Purchased CMBS and the status of assets underlying the Purchased
CMBS.
11. Paragraph 4(d) of the Repurchase Agreement is deleted and "(d) [OMITTED]"
substituted therefor and Paragraph 4(a) of the Repurchase Agreement is
deleted and the following substituted therefor:
"(a) Notwithstanding anything in the Agreement to the contrary, if on any
day the Repurchase Price for any Purchased CMBS (on a single Purchased CMBS
by single Purchased CMBS basis) exceeds (A) the Market Value of such
Purchased CMBS on such day multiplied by (B) the applicable Buyer's Margin
Ratio on such day for such
11
Purchased CMBS (each such Purchased CMBS, an "Affected CMBS" and such
amount shall constitute a "Margin Deficit"), then Buyer may by notice to
Seller require Seller to transfer to Buyer sufficient cash or additional
securities acceptable to Buyer in its sole discretion, which cash or
additional securities shall constitute Additional Purchased Securities
within the meaning of Paragraph 2(b) of the Repurchase Agreement, so that,
after such transfer(s), the Repurchase Price for each Affected CMBS shall
be less than or equal to (A) the Market Value of such Affected CMBS on such
day multiplied by (B) the applicable Buyer's Margin Ratio for such Affected
CMBS.
If Seller is required to transfer Additional Purchased Securities, Seller
shall make such transfer by the close of the Federal Reserve wire for money
transactions on the date notice is given if such notice is given before
10:00 a.m. (New York time) or, if such notice is given after 10:00 a.m.
(New York time), by the close of the Federal Reserve wire for money
transactions on the next Business Day.
12. Paragraph 2(c) of the Repurchase Agreement is amended to delete the text
from and including "with respect to" through and including "such date" and
to insert therefor "an amount equal to the Market Value of the Additional
Purchased Securities required to be transferred pursuant to Paragraph 4(a)
of the Repurchase Agreement.)
13. Paragraph 2(o) of the Repurchase Agreement is amended by inserting in
clause (ii) after "Paragraph 4(b) hereof" and before "and decreased by" the
following: "and by the amount of cash transferred by Buyer to BSCO to meet
a Margin Deficit under the BSCO Repurchase Agreement or otherwise to
benefit or for the account of Seller."
12
14. Paragraph 2(r) of the Repurchase Agreement is amended to insert: ", the
Exit Fee (as defined in Paragraph 18 of Annex l-A)" after the words "sum of
the Purchase Price" and before "and the Price Differential."
15. [RESERVED]
16. At all times the pool of mortgage loans relating to the Purchased CMBS
shall be qualified as a REMIC. If at any time any pool of mortgage loans
relating to a Purchased CMBS is not qualified as a REMIC then the Market
Value of such Purchased CMBS shall be deemed to be zero.
17. Paragraph 11 of the Repurchase Agreement is amended to delete the word "or"
before (vii) and to add the following after "obligations hereunder" and
prior to "(each an "Event of Default")":
(viii) Seller fails to make any payment of Price Differential within one
day after such payment becomes due, (and such Price Differential will be
adjusted to reflect the date payment is actually received by Buyer), (ix)
Seller fails to comply with Paragraph lO herein, (x) Seller fails to comply
with Paragraph 11 herein, or (xi) Seller fails to comply with any other
obligation to Buyer and such failure continues for a period of thirty days.
18. Seller may accelerate the Term Repurchase Date and pay the Repurchase Price
and other amounts due with respect to either (A) any Purchased CMBS having,
in the aggregate
13
with all other Purchased CMBS with respect to which there was an
acceleration of the Term Repurchase Date, Repurchase Prices not exceeding
$10,000,000 or (B) all, but not less than all, outstanding CMBS
Transactions, in each case, upon five Business Days' prior written notice
to Buyer, provided that (i) Seller pays a fee (the "Exit Fee") equal to the
lesser of (a) the expenses incurred by Buyer due to such acceleration of
the Term Repurchase Date (including, without limitation, costs of hedging
and breakage expenses), as determined by Buyer in its sole discretion, or
(b) (x) the number of whole and partial calendar months from the
accelerated Term Repurchase Date to the Termination Date multiplied by (y)
three and one-third basis points (0.033333 %) multiplied by (aa) if the
early termination is pursuant to sub-clause (A) of this sentence, the
Repurchase Prices of the affected Purchased CMBS or (bb) if the early
termination is pursuant to sub-clause (B) of this sentence, the greater of
(I) the sum of the Repurchase Prices (excluding the applicable Exit Fees)
for all Purchased CMBS or (II) the Maximum Amount, (ii) immediately after
the transfer of the affected Purchased CMBS and the payment of the related
Repurchase Price, Seller is not in default of any of its obligations under
this Agreement or the BSCO Repurchase Agreement and there will be no Margin
Deficit under this Agreement or the BSCO Repurchase and (iii) all Related
Xxxxxx are terminated simultaneously with the termination of the
corresponding CMBS Transactions and all obligations owed by Seller, or its
affiliates, under the Related Xxxxxx are satisfied. Notwithstanding the
foregoing, Buyer will not be responsible for delays in the return of any
Purchased CMBS to Seller if such Purchased CMBS has been sent to the
related trustee or to DTC, as appropriate, for reregistration. In either
event, Buyer agrees to notify Seller of any delays and will use its
reasonable best efforts to return the related
14
Purchased CMBS to Seller promptly. Seller shall pay the Exit Fee with
respect to all Purchased CMBS transferred to Seller on any Term Repurchase
Date that precedes the Termination Date with respect to such Purchased
CMBS. The acceleration of the Term Repurchase Date for any reason shall not
excuse Seller from paying the Exit Fee.
19. Subject to Paragraph 43 herein, Buyer's sole recourse under the Agreement
shall be to Purchased CMBS and to any and all other property held by or for
Seller at or by any Bear Xxxxxxx entity or any agent thereof, any and all
of Seller's right, title and interest in the Agreement, the BSCO Repurchase
Agreement, the Transactions under the BSCO Repurchase Agreement, the
Transactions under this Agreement, and all payments and performance due
under this Agreement, the BSCO Repurchase Agreement and each Transaction
under each such Agreement, and to all other Collateral (as such term is
defined in the Institutional Account Agreement) and Buyer shall have no
recourse to other assets or revenues of Seller, except that the foregoing
limitation does not apply to damages sustained by Buyer if Seller or any
affiliate has committed fraud, was grossly negligent, willfully impaired
Buyer's ability to exercise any rights or remedies under the Agreement, the
BSCO Repurchase Agreement or any other agreement with any other Bear
Xxxxxxx entity, acted in bad faith or failed to provide Buyer with any
material information, including, but not limited to the requirements set
forth in Paragraph 10 herein, in each case with respect to the Agreement,
the BSCO Repurchase Agreement or any other agreement with any other Bear
Xxxxxxx entity, the BSCO Repurchase Agreement, this Agreement or any
Purchased Security, provided, however, that Seller shall have no liability
for any consequential, incidental, special, exemplary, punitive, or
15
any similar damages. However, notwithstanding the proviso at the end of the
preceding sentence, Seller shall be liable for, any costs, losses, damages
and fees incurred in connection with a hedge entered into by Buyer after a
default by Seller.
The provisions of this section shall not, however, (a) constitute a waiver,
release or impairment of any obligation evidenced or secured by the
Agreement, or any other agreement with a Bear Xxxxxxx entity; (b) affect
the validity or enforceability of, or any guaranty made in connection with,
the Agreement, or any other agreement with a Bear Xxxxxxx entity or any of
the rights and remedies of Buyer or other Bear Xxxxxxx entity thereunder;
(c) impair the right of Buyer or other Bear Xxxxxxx entity to obtain the
appointment of a receiver; (d) constitute a prohibition against Buyer or
other Bear Xxxxxxx entity seeking a judgment against Seller in order to
commence any appropriate action or proceeding in order for Buyer or other
Bear Xxxxxxx entity to exercise its remedies against the Purchased
Securities, cash or other property described in the first sentence of the
preceding paragraph or any payments or performance due under the Agreement,
or any other agreement with a Bear Xxxxxxx entity; or (e) constitute a
waiver of the right of Buyer or any other Bear Xxxxxxx entity to enforce
the liability and obligation of Seller, by money judgement or otherwise, to
the extent of any loss, damage, cost, expense, liability, claim or other
obligation by Buyer or any other Bear Xxxxxxx entity (including attorneys'
fees and costs reasonably incurred) not incurred under the Agreement.
20. Seller's obligations under the Agreement consist of a single obligation,
notwithstanding that the CMBS Transactions are margined on a
Transaction-by-Transaction basis. Upon
16
an Event of Default, all Purchased Securities, cash and other property held
pursuant to the Agreement and all payments and performance due under the
Agreement may be utilized by Buyer to satisfy Seller's obligations under
the Agreement or any other agreement with Buyer.
21. Notwithstanding anything to the contrary in this Agreement, Buyer shall not
be deemed to have waived any right which it may have or be deemed to have
under Section 506(a), 506(b), 1111(b) or any other provisions of the U.S.
Bankruptcy Code to file a claim for the full amount due and owing under the
provisions of the Agreement.
22. For so long as Seller is not in default of any of its obligations under
this Agreement or the BSCO Repurchase Agreement, Buyer will refrain from
exercising Affirmative Control and Seller may exercise such Affirmative
Control. Buyer and Seller shall enter into such agreements as may be
necessary to effect this provision on a pool by pool basis, provided,
however, that nothing shall impair Buyer's right to exercise unilaterally
Affirmative Control upon a default by Seller of any of its obligations
under this Agreement or the BSCO Repurchase Agreement.
23. Notwithstanding anything in the Agreement to the contrary, Buyer shall have
the right to assign any or all of the Transactions to any of its affiliates
provided that Buyer remains responsible for the performance by such
affiliate of its obligations in respect of any transferred CMBS
Transaction.
17
24. Notwithstanding anything in the Agreement to the contrary and for so long
as Seller is not in default of any provision of this Agreement, Seller may
substitute Purchased CMBS with other CMBS acceptable to Buyer in its sole
discretion. In the event such substitution is accepted by Buyer, such
substitution shall be made by Seller's transfer to Buyer of such
substituted CMBS and Buyer's transfer to Seller of such Purchased CMBS, and
after such substitution, the substituted CMBS shall be deemed to be
Purchased CMBS. In the event Buyer elects not to accept such substitution,
Buyer shall offer Seller the right to terminate simultaneously all the
outstanding CMBS Transactions pursuant to Paragraph 18 herein.
25. Buyer may, in its sole discretion, from time to time permit Seller to
utilize an amount less than or equal to the Maximum Transfer Amount (as
defined herein) of any Purchased CMBS to meet a Margin Deficit for any
other CMBS Transaction or any other Transaction under this Agreement.
26. Buyer may, in its sole discretion and with the permission of BSCO, from
time to time permit Seller to (x) utilize an amount less than or equal to
the Maximum BSCO Transfer Amount to meet a Margin Deficit for any
Transaction under this Agreement and (y) utilize an amount less than or
equal to the Maximum Transfer Amount to meet a Margin Deficit under the
BSCO Repurchase Agreement.
18
27. Upon one Business Day's notice to Seller, Buyer, in its sole discretion,
may determine at any time, with respect to any Transaction under this
Agreement or the BSCO Repurchase Agreement, to revoke its permission for
Seller to utilize some or all of the Maximum Transfer Amount to meet a
Margin Deficit and such Maximum Transfer Amount shall thereafter not be
available to meet a Margin Deficit, notwithstanding the prior utilization
by Seller of such Maximum Transfer Amount to meet a Margin Deficit.
28. Seller acknowledges that it shall not rely on any availability of any
Maximum Transfer Amount to meet a Margin Deficit under this Agreement or
the BSCO Repurchase Agreement in view of Buyer's not having any obligation
to allow Maximum Transfer Amount to be used to meet a Margin Deficit or to
continue to be used to meet a Margin Deficit, each such decision being
within Buyer's sole discretion. Any failure on behalf of Buyer to require
Seller to meet a Margin Deficit shall not be a waiver of any right to
require the transfer of Additional Purchased Securities, or to otherwise
meet a Margin Deficit, with respect to any Transaction at any time.
29. Notwithstanding anything to the contrary in the Agreement, any Purchased
CMBS utilized to meet a Margin Deficit for any other Transaction (under
this Agreement or under the BSCO Repurchase Agreement) shall not be
returned to Seller upon payment of the Repurchase Price of such other
Transaction by reason of such Purchased CMBS having been used to meet a
Margin Deficit for such other Transaction.
30. [RESERVED]
19
31. [RESERVED]
32. [RESERVED]
33. Notwithstanding anything to the contrary in the Agreement or the BSCO
Repurchase Agreement, any Purchased CMBS utilized to meet a Margin Deficit
under the BSCO Repurchase Agreement shall not be returned to Seller upon
payment of its obligations with respect to such Transaction under the BSCO
Repurchase Agreement by reason of such Purchased CMBS having been used to
meet a Margin Deficit under the BSCO Repurchase Agreement. Buyer shall have
no obligation to release any monies to Seller with respect to any
Transaction unless and until all Transactions under this Agreement and
under the BSCO Repurchase Agreement are adequately margined pursuant to
this Agreement and the BSCO Repurchase Agreement.
34. [RESERVED]
35. At the request of BSCO, Buyer may, in its sole discretion, transfer cash in
an amount less than Maximum Transfer Amount to BSCO to meet a Margin
Deficit under the BSCO Repurchase Agreement; provided, however, that any
such cash transferred in excess of any cash applied by BSCO to the
obligations of Seller under the BSCO Repurchase Agreement, shall be
returned to Buyer. At the request of Buyer, BSCO may, in its sole
discretion, transfer cash in an amount less than the Maximum BSCO Transfer
Amount, if
20
any, to Buyer to meet a Margin Deficit under the Agreement provided,
however, that any such cash transferred in excess of any cash applied by
Buyer to the obligations of Seller under the Agreement shall be returned to
BSCO.
36. Funds transferred by Seller to Buyer may be co-mingled and funds may be
held at various Bear Xxxxxxx entities. Seller may obtain repayment of funds
transferred to Buyer by Seller at a time when there was no Margin Deficit
under this Agreement or the BSCO Repurchase Agreement and no outstanding
requests for margin on notice to Buyer if: (i) there is no default under
the Agreement or the BSCO Repurchase Agreement, (ii) such withdrawal will
not result in a Margin Deficit under this Agreement or the BSCO Repurchase
Agreement and (iii) Seller has no outstanding obligations to any Bear
Xxxxxxx entity.
37. [RESERVED]
38. [RESERVED]
39. [RESERVED]
40. The Agreement, the BSCO Repurchase Agreement and the Institutional Account
Agreement constitute the entire agreement between the parties hereto with
respect to the
21
subject matter hereof, and supersede all prior agreements, understandings,
negotiations and discussions between the parties hereto, whether verbal or
written, with respect to such subject matter.
41. Except for the Institutional Account Agreement, this Agreement shall
supersede any agreement between Seller and any Bear Xxxxxxx entity with
respect to all CMBS Transactions.
42. Payments of principal of Purchased CMBS shall be applied to reduce the
Repurchase Price of such Purchased CMBS. Payments of interest received in
connection with Purchased CMBS shall be applied to reduce Seller's
obligations to make monthly Price Differential payments. Any Income
received by Buyer in excess of the amounts necessary to satisfy the
obligations set forth in the prior two sentences shall be released to
Seller, provided, however that such funds shall be released only if Seller
is not in default of any of its obligations under this Agreement or the
BSCO Repurchase Agreement and there will be no Margin Deficit under this
Agreement or the BSCO Repurchase Agreement after the release of such cash.
43. Seller shall post a Letter of Credit in an amount equal to $5,000,000 in
form and substance acceptable to Buyer in its sole discretion issued by a
financial institution whose long term-debt is rated at least "A" or
equivalent and is acceptable to Buyer in its sole discretion. Such Letter
of Credit shall be additional Collateral (as defined in the Institutional
Account Agreement) as security for all obligations owed by Seller hereunder
22
and such Letter of Credit shall be drawable 14 days before expiration if
not renewed prior to such time. Such Letter of Credit shall be released by
Buyer at its sole discretion.
23
BEAR, XXXXXXX INTERNATIONAL LIMITED, LNR CMBS HOLDINGS CORPORATION
By: /s/ XXXX X. XXXXXXXX By: /s/ XXXXXX XXXXX
--------------------------------- ---------------------------------
Xxxx X. Xxxxxxxx Xxxxxx Xxxxx
Title: Director Title: Vice President
------------------------------ ------------------------------
Date: November 06, 2000 Date: April 14, 2000
------------------------------- -------------------------------
BEAR, XXXXXXX & CO., INC.
By: /s/ XXXX X. XXXXXXXX
---------------------------------
Xxxx X. Xxxxxxxx
Title: Senior Managing Director
------------------------------
Date: November 06, 2000
-------------------------------
24
ANNEX II
Names and Addresses for Communications Between Parties
PARTY A: LNR Properties Corporation
000 XX 000xx Xxxxxx
Xxxxx 000
Xxxxx, XX 00000
ATTENTION: Xxxxxx Xxxxx, Vice President
TELEPHONE: (000) 000-0000
PARTY B: Bear, Xxxxxxx & Co. Inc.
Government Operations
0 Xxxxxxxxx Xxxxxx Xxxxx
0xx Xxxxx
Xxxxxxxx, XX 00000-0000
ATTENTION: Sr. Managing Director
TELEPHONE: (000) 000-0000
Annex III
International Transactions
This Annex III (including any Schedules hereto) forms a part of the Master
Repurchase Agreement dated as of March 31, 1999 (the "Agreement") between Bear
Xxxxxxx International Limited and LNR CMBS Holdings Corporation. Capitalized
terms used but not defined in this Annex III shall have the meaning ascribed to
them in the Agreement.
1. Definitions. For purposes of the Agreement and this Annex III:
(a) The following terms shall have the following meanings:
"Base Currency", United States dollars or such other currency as Buyer
and Seller may agree in the Confirmation with respect to any
International Transaction or otherwise in writing;
"Business Day" or "business day":
(i) relation to any International Transaction which (A) involves an
International Security and (B) is to be settled through CEDEL or
Euroclear, a day on which CEDEL or, as the case may be, Euroclear
is open to settle business in the currency in which the Purchase
Price and the Repurchase Price are denominated;
(ii) in relation to any International Transaction which (A) involves
an International Security and (B) is to be settled through a
settlement system other than CEDEL or Euroclear, a day on which
that settlement system is open to settle such International
Transaction;
(iii) in relation to any International Transaction which involves a
delivery of Securities not falling within (I) or (ii) above, a
day on which banks are open for business in the place where
delivery of the relevant Securities is to be effected; and
(iv) in relation to any International Transaction which involves an
obligation to make a payment not falling within (I) or (ii)
above, a day other than a Saturday or Sunday on which banks are
open for business in the principal financial center of the
country of which the currency in which the payment is denominated
is the official currency and, if different, in the place where
any account designated by the parties for the making or receipt
of the payment is situated (or, in the case of ECU, a day on
which ECU clearing operates);
"CEDEL", CEDEL Bank, societe anonyme;
"Contractual Currency", the currency in which the International
Securities subject to any International Transaction are
denominated or such other currency as may be specified in the
Confirmation with respect to any International Transaction;
"Euroclear", Xxxxxx Guaranty Trust Company of New York, Brussels
Branch, as operator of the Euroclear System;
"International Security", any Security that (I) is denominated in
a currency other than United States dollars or (ii) is capable of
being cleared through a clearing facility outside the United
States or (iii) is issued by an issuer organized under the laws
of a jurisdiction other than the United States (or any political
subdivision thereof);
"International Transaction", any Transaction involving (I) an
International Security or (ii) a party organized under the laws
of a jurisdiction other than the United States (or any political
subdivision thereof) or having its principal place of business
outside the United States or (iii) a branch or office outside the
United States designated in Annex I by a party organized under
the laws of the United States (or any political subdivision
thereof) as an office through which that party may act;
"LIBOR", in relation to any sum in any currency, the offered rate
for deposits for such sum in such currency for a period of three
months which appears on the Reuters Screen LIBO page as of 11:00
A.M., London time, on the date on which it is to be determined
(or, if more than one such rate appears, the arithmetic mean of
such rates);
"Spot Rate", where an amount in one currency is to be converted
into a second currency on any date, the spot rate of exchange of
a comparable amount quoted by Buyer and Seller, for the sale by
such bank of such second currency against a purchase by it of
such first currency.
(b) Notwithstanding Paragraph 2 of the Agreement, the term "Prime Rate"
shall mean, with respect to any International Transaction, LIBOR plus a
spread, as may be specified in the Confirmation with respect to any
International Transaction or otherwise in writing.
2. Manner of Transfer. All transfers of International Securities (I) shall be
in suitable form for transfer and accompanied by duly executed instruments
of transfer or assignment in blank (where required for transfer) and such
other documentation as the transferee may reasonably request, or (ii) shall
be transferred through the book-entry system of Euroclear or CEDEL, or
(iii) shall be transferred through any other agreed securities clearing
system or (iv) shall be transferred by any other method mutually acceptable
to Seller and Buyer.
3. Contractual Currency.
(a) Unless otherwise mutually agreed, all funds transferred in respect of
the Purchase Price or the Repurchase Price in any International
Transaction shall be in the Contractual Currency.
(b) Nothwithstanding subparagraph (a) of this Paragraph 3, the payee of any
payment may, at its option, accept tender thereof in any other
currency; provided, however, that, to the extent permitted by
applicable law, the obligation of the payor to make such payment will
be discharge only to the extent of the amount of the Contractual
Currency that such payee may, consistent with normal banking
procedures, purchase with such other currency (after deduction of any
premium and costs of exchange) for delivery within the customary
delivery period for spot transactions in respect of the relevant
currency.
(c) If for any reason the amount in the Contractual Currency so received,
including amounts received after conversion of any recovery under any
judgment or order expressed in a currency other than the Contractual
Currency, falls short of the amount in the Contractual Currency due in
respect of the Agreement, the party required to make the payment shall
(unless an Event of Default has occurred and such party is the
nondefaulting party) as a separate and independent obligation (which
shall not merge with any judgment or any payment or any partial payment
or enforcement of payment) and to the extent permitted by applicable
law, immediately pay such additional amount in the Contractual Currency
as may be necessary to compensate for the shortfall.
(d) If for any reason the amount of the Contractual Currency received by
one party hereto exceeds the amount in the Contractual Currency due
such party in respect of the Agreement, then (unless an Event of
Default has occurred and such party is the nondefaulting party) the
party receiving the payment shall refund promptly the amount of such
excess.
4. Notices. Any and all notices, statements, demands or other communications
with respect to International Transactions shall be given in accordance
with Paragraph 13 of the Agreement and shall be in the English language.
5. Taxes.
(a) Transfer taxes, stamp taxes and all similar costs with respect to the
transfer of Securities shall be paid by Seller.
(b) (i) Unless otherwise agreed, all money payable by on party (the
"Payor") to the other (the "Payee") in respect of any
International Transaction shall be paid free and clear of, and
without withholding or deduction for, any taxes or duties of
whatsoever nature imposed, levied, collected, withheld or assessed
by any authority having power to tax (a "Tax"), unless the
withholding or deduction of such Tax is required by law. In that
even, unless otherwise agreed, Payor shall pay such additional
amounts as will result in the net amounts receivable by Payee
(after taking account of such withholding or deduction) being
equal to such amounts as would have been received by Payee had no
such Tax been required to be withheld or deducted; provided that
for purposes of Paragraphs 5 and 6 the term "Tax" shall not
include any Tax that would not have been imposed but for the
existence of any present or former connection between Payee and
the jurisdiction imposing such Tax other than the mere receipt of
payment from Payor or the performance of Payee's obligations under
an International Transaction. The parties acknowledge and agree,
for the avoidance of doubt, that the amount of Income required to
be transferred, credited or applied by Buyer for the benefit of
Seller under Paragraph 5 of the Agreement shall be determined
without taking into account ant Tax required to be withheld or
deducted from such Income, unless otherwise agreed.
(ii) In the case of any Tax required to be withheld or deducted from
any money payable to a party hereto acting as Payee by the other
party hereto acting as Payor, Payee agrees to deliver to Payor
(or, if applicable, to the authority imposing the Tax) any
certificate or document reasonably requested by Payor that would
entitle Payee to an exemption from, or reduction in the rate of,
withholding or deduction of Tax from money payable by Payor to
Payee.
(iii) Each party hereto agrees to notify the other party of any
circumstance known or reasonably known to it (other than a Change
of Tax Law, as defined in Paragraph 6 hereof) that causes a
certificate or document provided by it pursuant to subparagraph
(b)(ii) of this Paragraph to fail to be true.
(iv) Notwithstanding subparagraph (b)(i) of this Paragraph, no
additional amounts shall be payable by Payor to Payee in respect
of an International Transaction to the extent that such
additional amounts are payable as a result of a failure by Payee
to comply with its obligations under subparagraph (b)(ii) or
(b)(iii) of this Paragraph with respect to such International
Transaction.
6. Tax Event.
(a) This Paragraph 6 shall apply if either party notifies the other, with
respect to a Tax required to be collected by withholding or deduction
that -
(i) any action taken by a taxing authority or brought in a court of
competent jurisdiction after the date of an International
Transaction is entered into, regardless of whether such action is
taken or brought with respect to a party to the Agreement; or
(ii) a change in the fiscal or regulatory regime after the date of
International Transaction is entered into, (each, a "Change of
Tax Law") has or will, in the notifying party's reasonable
opinion, have a materiel adverse effect on such party in the
context of an International Transaction.
(b) If so requested by the other party, the notifying party will furnish
the other party with an opinion of a suitably qualified adviser that
an event referred to in subparagraph (a)(i) or (a)(ii) of this
Paragraph 6 has occurred and affects the notifying party.
(c) Where this Paragraph 6 applies, the party giving the notice referred
to in subparagraph (a) above may, subject to subparagraph (d) below,
terminate the International Transaction effective from a date
specified in the notice, not being earlier (unless so agreed by the
other party) than 30 days after the date of such notice, by nominating
such date as the Repurchase Date.
(d) If the party receiving the notice referred to in subparagraph (a) of
this Paragraph 6 so elects, it may override such notice by giving a
counter-notice to the other party. If a counter-notice is given, the
party which gives such counter-notice will be deemed to have agreed to
indemnify the other party against the adverse effect referred to in
subparagraph (a) of this Paragraph 6 so far as it relates to the
relevant International Transaction and the original Repurchase Date
will continue to apply.
(e) Where an International Transaction is terminated as described in this
Paragraph 6, the party which has given the notice to terminate shall
indemnify the other party against any reasonable legal and other
professional expenses incurred by the other party by reason of the
termination, but the other party may not claim any sum constituting
consequential loss or damage in respect of a termination in accordance
with this Paragraph 6.
(f) This Paragraph 6 is without prejudice to Paragraph 5 of this Annex
III; but an obligation to pay additional amounts pursuant to Paragraph
5 of this Annex III may, where appropriate, be a circumstance which
causes this Paragraph 6 to apply.
7. Margin. In the calculation of "Margin Deficit" and "Margin Excess" pursuant
to Paragraph 4 of the Agreement, all sums not denominated in the Base
Currency shall be deemed to be converted into the Base Currency at the Spot
Rate on the date of such calculation.
8. Events of Default.
(a) In addition to the Events of Default set forth in Paragraph 11 of the
Agreement, it shall be an additional "Event of Default" if either
party fails, after on business day's notice, to perform any covenant
or obligation required to be performed by it under this Annex III,
including, without limitation, the payment of taxes or additional
amounts as required by Paragraph 5 of this Annex III.
(b) In addition to the other rights of a nondefaulting party under
Paragraph 11 of the Agreement, following an Event of Default, the
nondefaulting party may, at any time at its option, effect the
conversion of any currency into a different currency of its choice at
the Spot Rate on the date of the exercise of such option and offset
obligations of the defaulting party denominated in different
currencies against each other.
Schedule III.A
International Transactions Relating to [Relevant Country]
This Schedule III.A forms a part of Annex III to the Master Repurchase Agreement
dated as of March 31, 1999 (the "Agreement" between Bear Xxxxxxx International
Ltd. and LNR CMBS Holdings Corporation. Capitalized terms used but not defined
in this Schedule III. A shall have the meaning ascribed to them in Annex III.
[Insert provisions applicable to relevant country]
Annex IV
Party Acting as Agent
* Bear Xxxxxxx International Limited ** LNR CMBS Holdings Corporation
This Annex IV forms a part of the Master Repurchase Agreement dated as of March
31, 1999, 19__ (the "Agreement") between *________ and **________. This Annex IV
sets forth the terms and conditions governing all transactions in which a party
selling securities or buying securities, as the case may be) "Agent"), in a
Transaction is acting as agent for one or more third parties (each, a
"Principal"). Capitalized terms used but not defined in this Annex IV shall have
the meanings ascribed to them in the Agreement.
1. Additional Representations. In addition to the representations set forth in
Paragraph 10 of the Agreement, Agent hereby makes the following
representations, which shall continue during the term of any Transaction:
Principal has duly authorized Agent to execute and deliver the Agreement on
its behalf, has the power to so authorize Agent and to enter into the
Transactions contemplated by the Agreement and to perform the obligations of
Seller or Buyer, as the case may be, under such Transactions, and has taken
all necessary action to authorize such execution and delivery by Agent and
such performance by it.
2. Identification of Principals. Agent agrees (a) to provide the other party,
prior to the date on which the parties agree to enter into any transaction
under the Agreement, with a written list of Principals for which it intends
to act as Agent (which list may be amended in writing from time to time with
the consent of the other party), and (b) to provide the other party, before
the close of business on the next business day after orally agreeing to
enter into a Transaction, with notice of the specific Principal or
Principals for whom it is acting in connection with such Transaction. If (i)
Agent fails to identify such Principal or Principals prior to the close of
business on such next business day or (ii) the other party shall determine
in its sole discretion that any Principal or Principals identified by Agent
are not acceptable to it, the other party may reject and rescind any
Transaction with such Principal or Principals, return to Agent any Purchased
Securities or portion of the Purchase Price, as the case may be, previously
transferred to the other party and refuse any further performance under such
Transaction, and Agent shall immediately return to the other party any
portion of the Purchase Price or Purchased Securities, as the case may be,
previously transferred to Agent in connection with such Transaction;
provided, however, that (A) the other party shall promptly (and in any event
within one business day) notify Agent of its determination to reject and
rescind such Transaction and (B) to the extent that any performance was
rendered by any party under any Transaction rejected by the other party,
such party shall remain entitled to any Price Differential or other amounts
that would have been payable to it with respect to such performance if such
Transaction had not been rejected. The other party acknowledges that Agent
shall not have any obligation to provide it with confidential information
regarding the financial status of its Principals; Agent agrees, however,
that it will assist the other party in obtaining from Agent's Principals
such information regarding the financial status of such Principals as the
other party may reasonably request.
3. Limitation of Aqent's Liability. The parties expressly acknowledge that if
the representations of Agent under the Agreement, including this Annex IV,
are true and correct in all material respects during the term of any
Transaction and Agent otherwise complies with the provisions of this Annex
IV, then (a) Agent's obligations under the Agreement shall not include a
guarantee of performance by its Principal or Principals and (b) the other
party's remedies shall not include a right of setoff in respect of rights or
obligations, if any, of Agent arising in other transaction in which Agent is
acting as principal.
4. Multiple Principals.
(a) In the event that Agent proposes to act for more than one Principal
hereunder, Agent and the other party shall elect whether (I) to treat
Transactions under the Agreement as transactions entered into on behalf of
separate Principals or (ii) to aggregate such Transactions as if they were
transactions by a single Principal. Failure to make such an election in
writing shall be deemed an election to treat Transactions under the
Agreement as transactions on behalf of separate Principals.
(b) In the event that Agent and the other party elect (or are deemed to
elect) to treat Transactions under the Agreement as transaction on behalf of
separate Principals, the parties agree that (I) Agent will provide the other
party, together with the notice described in Paragraph 2(b) of this Annex
IV, notice specifying the portion of each Transaction allocable to the
account of each of the Principals for which it is acting (to the extent that
any such Transaction is allocable to the account of more than one
Principal); (ii) the portion of any individual Transaction allocable to each
Principal shall be deemed a separate Transaction under the Agreement; (iii)
the margin maintenance obligations of Buyer and Seller under Paragraph 4 of
the Agreement shall be determined on a Transaction- by- Transaction basis
(unless the parties agree to determine such obligations on a
Principal-by-Principal basis); and (iv) Buyer's and Seller's remedies under
the Agreement had entered into a separate
Agreement with the other party on behalf of each of its Principals.
(c) In the event that Agent and the other party elect to treat Transactions
under the Agreement as if they were transactions by a single Principal, the
parties agree that (1) Agent's notice under Paragraph 2(b) of this Annex IV
need only identify the names of its Principals but not the portion of each
Transaction allocable to each Principal's account; (ii) the margin
maintenance obligations of Buyer and Seller under Paragraph 4 of the
Agreement shall, subject to any greater requirement imposed by applicable
law, be determined on an aggregate basis for all Transactions entered into
by Agent on behalf of any Principal, and (iii) buyer's and Seller's remedies
upon the occurrence of an Event of Default shall be determined as if all
Principals were a single Seller or Buyer, as the case may be.
(d) Notwithstanding any other provision of the Agreement (including, without
limitation, this Annex IV), the parties agree that any Transactions by Agent
on behalf of an employee benefit plan under ERISA shall be treated as
Transactions on behalf of separate Principals in accordance with Paragraph
4(b) of this Annex IV (and all margin maintenance obligations of the parties
shall be determined on a Transaction-by-Transaction basis).
5. Interpretation of Terms. All references to "Seller" or "Buyer", as the case
may be, in the Agreement shall, subject to the provisions of this Annex IV
(including, among other provisions, the limitations on Agent's liability in
Paragraph 3 of this Annex IV), be construed to reflect that (1) each
Principal shall have, in connection with any Transaction or Transactions
entered into by Agent on its behalf, the entering into such Transaction or
Transactions with the other party under the Agreement, and (ii) Agent's
Principal or Principals have designated Agent as their sole agent for
performance of Seller's obligations to Buyer or buyer's obligations to
Seller, as the case may be, and for receipt of performance by Buyer of its
obligations to Seller or Seller of its obligations to Buyer, as the case may
be, in connection with any Transaction or Transactions under the Agreement
(including, among other things, as Agent for each Principal in connection
with transfers of Securities, cash or other property and as agent for giving
and receiving all notices under the Agreement). Both Agent and its Principal
or Principals shall be deemed "parties" to the Agreement and all references
to a "party" or "either party" in the Agreement shall be deemed revised
accordingly (and any Act of Insolvency with respect to Agent or any other
Event of Default by Agent under Paragraph 11 of the Agreement shall be
deemed an Event of Default by Seller or Buyer, as the case may be).
Annex V
Margin for Forward Transactions
* Bear Xxxxxxx International Limited ** LNR CMBS Holdings Corporation
This Annex V forms a part of the Master Repurchase Agreement dated as of March
31, 1999, 19__ (the "Agreement") between *________ and **________. Capitalized
terms used but not defined in this Annex V shall have the meanings ascribed to
them in the Agreement.
1. Definitions. For purposed of the Agreement and this Annex V, the following
terms shall have the following meanings:
"Forward Exposure", the amount of loss a party would incur upon canceling a
Forward Transaction and entering into a replacement transaction, determined
in accordance with market practice or as otherwise agreed by the parties;
"Forward Transaction", any Transaction agreed to by the parties as to which
the Purchase Date has not yet occurred;
"Net Forward Exposures", the aggregate amount of a party's Forward Exposure
to the other party under all Forward Transaction hereunder reduced by the
aggregate amount of any Forward Exposure of the other party to such party
under all Forward Transactions hereunder;
"Net Unsecured Forward Exposure", a party's Net Forward Exposure reduced by
the Market Value of any Forward Collateral transferred to such party (and
not returned) pursuant to Paragraph 2 of this Annex V.
2. Margin Maintenance.
(a) If at any time a party (the In-the-Money Party") shall have a Net Unsecured
Forward Exposure to the other party (the "Out-of-the-Money Party") under
one or more Forward Transactions, the In-the-Money Party may by notice to
the Out-of-the-Money Party Securities require the Out-of-Money Party to
transfer to the In-the-Money Party Securities or cash reasonably acceptable
to the In-the-Money Party (together with any In come thereon and proceeds
thereof, Forward Collateral") having a Market Value sufficient to eliminate
such Net Unsecured Forward Exposure. the Out-of-the-Money Party may by
notice to the In-the-Money Party require the In-the-Money Party to transfer
to the Out-of-the-Money Party Forward Collateral having a Market Value that
exceeds the In-the-Money Party's Net Forward Exposure ("Excess Forward
Collateral Amount"). The rights of the parties under this subparagraph
shall be in addition to their rights under subparagraphs (a) and (b) of
Paragraph 4 and any other provisions of the Agreement.
(b) The parties may agree, with respect to any or all Forward Transactions
hereunder, that the respective rights of the parties under subparagraph (a)
of this Paragraph may be exercised only where a Net Unsecured Forward
exposure or Excess Forward Collateral Amount, as the case may be, exceeds a
specified dollar amount or other specified threshold for such Forward
transactions (which amount or threshold shall be agreed to by the parties
prior to entering into any such Forward Transactions).
(c) The parties may agree, with respect to any or all Forward Transaction
hereunder, that the respective rights of the parties under subparagraph (a)
of this Paragraph to require the elimination of a Net Unsecured Forward
Exposure or Excess Forward collateral Amount, as the case may be, may be
exercised whenever such a Net Unsecured Forward Exposure or Excess Forward
Collateral Amount exists with respect to any single Forward Transaction
hereunder (calculated without regard to any other Forward Transaction
outstanding hereunder).
(d) The parties may agree, with respect to any or all Forward Transaction
hereunder, that (1) one party shall transfer to the other party Forward
Collateral having a Market Value equal to a specified dollar amount or
other specified threshold no later than the Margin Notice Deadline on the
day such Forward Transaction is entered into by the parties or (ii) one
party shall not be required to make any transfer, the Market Value of the
Forward Collateral held by such party would be less than a specified dollar
amount or other specified thresh old (which amount or threshold shall be
agreed to by the parties prior to entering into any such Forward
Transactions).
(e) If any notice is given by a party to the other under subparagraph (a) of
this Paragraph at or before the Margin Notice Deadline on any business day,
the party receiving such notice shall transfer Forward Collateral as
provided in such subparagraph no later than the close of business in the
relevant market on such business day. If any such notice is given after the
Margin Notice Deadline, the party receiving such notice shall transfer
such Forward Collateral later than the close of business in the relevant
market on the next business day.
(f) Upon the occurrence of the Purchase Date for any Forward Transaction and
the performance by the parties of their respective obligations to transfer
cash and Securities on such date, any Forward Collateral in respect of such
Forward Transaction, together with any Income thereon and proceeds thereof,
shall be transferred by the party holding such Forward Collateral to the
other party; provided, however, that neither party shall be required to
transfer such Forward Collateral to the other if such transfer would result
in the creation of a Net Unsecured Forward Exposure of the transferor.
(g) The Pledgor (as defined below) of Forward Collateral may, subject to
agreement with and acceptance by the Pledgee (as defined below) thereof,
substitute other Securities reasonably acceptable to the Pledgee for any
Securities Forward Collateral. Such substitution shall be made by transfer
to the Pledgee of such other Securities and transfer to the Pledgor of such
Securities Forward Collateral. After substitution, the substituted
Securities shall constitute Forward Collateral.
3. Security Interest.
(a) In addition to the rights granted to the parties under Paragraph 6 of the
Agreement, each party ("Pledgor") hereby pledges to the other party
("Pledgee") as security for the performance of its obligations hereunder,
and grants Pledgee a security interest in and right of setoff against, any
Forward Collateral and any other cash, Securities or property, and all
proceeds of any of the foregoing, transferred by or on behalf of Pledgor or
due from Pledgee to Pledgor in connection with the Agreement and the
Forward Transactions hereunder.
(b) Unless otherwise agreed by the parties, a party to whom Forward Collateral
has been transferred shall have the right to engage in repurchase
transaction with Forward collateral or otherwise sell, transfer, pledge or
hypothecate Forward Collateral, including in respect of loans or other
extensions of credit to such party that may be in amounts greater than the
forward Collateral such party is entitled to as security for obligations
hereunder, and that may extend for periods of time longer than the periods
during which such party is entitled to Forward Collateral as security for
obligations hereunder; provided, however, that no such transaction shall
relieve such party of its obligations to transfer Forward Collateral
pursuant to Paragraph 2 or 4 of this Annex V or Paragraph 11 of the
Agreement.
4. Events of Default
(a) In addition to the Events of Default set forth in Paragraph 11 of the
Agreement, it shall be an additional "Event of Default" if either party
fails, after one business day's notice, to perform any covenant or
obligation required to be performed by it under Paragraph 2 or any other
provision of this Annex.
(b) In addition to the other rights of a nondefaulting party under Paragraphs
11 and 12 of the Agreement, if the nondefaulting party exercised or is
deemed to have exercised the option referred to in Paragraph 11(a) of the
Agreement:
(i) The nondefaulting party, without prior notice to the defaulting party,
may (A) immediately sell, in a recognized market (or otherwise in a
commercially reasonable manner) at such price or prices as the
nondefaulting party may reasonably deem satisfactory, any or all price
or prices as the nondefaulting party may reasonably deem satisfactory,
any or all Forward Collateral subject to any or all Forward
Transactions hereunder and apply the proceeds thereof to any amounts
owing by the defaulting party hereunder or (B) in its sole discretion
elect, in lieu of selling all or a portion of such Forward Collateral
in an amount equal to the price therefor on such date, obtained from a
generally recognized source or the most recent closing bid quotation
from such a source, against any amounts owing by the defaulting party
hereunder.
(ii) Any Forward Collateral held by the defaulting party, together with any
Income thereon and proceeds thereof, shall be immediately transferred
by the defaulting party to the nondefaulting party. The nondefaulting
party may, as its option (which option shall be deemed to have been
exercised immediately
upon the occurrence of an Act of Insolvency), and without prior notice
to the defaulting party, (I) immediately purchase, in a recognized
market (or otherwise in a commercially reasonable manner) at such
price or prices as the nondefaulting party may reasonably deem
satisfactory, securities ("Replacement Securities") of the same party
to the nondefaulting party as required hereunder or (ii) in its sole
discretion elect, in lieu of purchasing Replacement Securities, to be
deemed to have purchased Replacement Securities at the price therefor
on such date, obtained from a generally recognized source or the most
recent closing offer quotation from such a source, whereupon the
defaulting party shall be liable for the price of such Replacement
Securities together with the amount of any cash Forward Collateral not
delivered by the defaulting party to the nondefaulting party as
required hereunder.
Unless otherwise provided in Annex I, the parties acknowledge and agree that (1)
the Forward Collateral subject to any Forward transaction hereunder are
instruments traded in a recognized market, (2) in the absence of a generally
recognized source for prices or bid quotations for any Forward Collateral, the
non-defaulting party may establish the source therefor in its sole discretion
and (3) all prices and bids shall be determined together with accrued Income
(except to the extent contrary to market practice with respect to the relevant
Forward Collateral).
5. No Waivers, Etc. Without limitation of the provisions of Paragraph 17 of
the Agreement, the failure to give a notice pursuant to subparagraph (a),
(b), (c) or (d) of Paragraph 2 of this Annex V will not constitute a waiver
of any right to do so at a later date.
Annex VI
Buy/Sell Back Transactions
This Annex VI forms a part of the Master Repurchase Agreement dated as of March
31, 1999, 19__ (the "Agreement") between Bear Xxxxxxx International Ltd. and LNR
CMBS Holdings Corporation. Capitalized terms used but not defined in this Annex
Vl shall have the meaning ascribed to them in the Agreement.
1. In the event of any conflict between the terms of this Annex Vl and any
other term of the Agreement, the terms of this Annex Vl shall prevail.
2. Each Transaction shall be identified at the time it is entered into and in
the relevant Confirmation as either a Repurchase Transaction or a Buy/Sell
Back Transaction.
3. In the case of a buy/Sell Back Transaction, the Confirmation delivered in
accordance with Paragraph 3 of the Agreement may consist of a single
document in respect of both of the transfers of funds against Securities
which together form the Buy/Sell Back Transaction or separate Confirmations
may be delivered in respect of each such transfer.
4. Definitions. The following definitions shall apply to Buy/Sell Back
Transactions:
(a) "Accrued Interest", with respect to any Purchased Securities subject to a
Buy/Sell Back Transaction, unpaid Income that has accrued during the period
from (and including) the issue date or the last Income payment date
(whichever is later) in respect of such Purchased Securities to (but
excluding) the date of calculation. For these purposes unpaid Income shall
be deemed to accrue on a daily basis from (and including) the issue date or
the last Income payment date (as the case may be) to (but excluding) the
next Income payment date or the maturity date (whichever is earlier);
(b) "Sell Back Differential", with respect to any buy/Sell Back Transaction as
of any date, the aggregate amount obtained by daily application of the
Pricing Rate for such Buy/Sell Back Transaction to the Purchase Price for
such Buy/Sell Back Transaction on a 360 day per year basis (unless
otherwise agreed by the parties for the Transaction) for the actual number
of days during the period commencing on (and including) the Purchase Date
for such Buy/Sell Back Transaction and ending on (but excluding) the date
of determination;
(c) "Sell Back Price", with respect to any Buy/Sell Back Transaction:
(i) in relation to the date originally specified by the parties as the
Repurchase Date pursuant to Paragraph 2(q) of the Agreement, the price
agreed by the Parties in relation to such Buy/Sell Back Transaction, and
(ii) in any other case (including for the purposes of the application of
Paragraph 4 or Paragraph 11 of the Agreement), the product of the formula
(P + D) - (IR + C), where -
P = the Purchase Price
D = the Sell Back Differential
IR = the amount of any Income in respect of the Purchased Securities paid
by the issuer on any date falling between the Purchase Date and the
Repurchase Date
C = the aggregate amount obtained by daily application of the Pricing Rate
for such buy/Sell Back Transaction to any such Income from (and including)
the date of payment by the issuer to (but excluding) the date of
calculation.
5. When entering into a buy/Sell Back Transaction the parties shall also agree
on the Sell Back Price and the Pricing Rate to apply in relation to such
Buy/Sell Back Transaction on the scheduled Repurchase Date. The parties
shall record the Pricing Rate in a least one Confirmation applicable to
such Buy/Sell Back Transaction.
6. Termination of a Buy/Sell Back Transaction shall be effected on the
Repurchase Date by transfer to Seller or its agent of Purchased Securities
against the payment by Seller of (i) in a case where the Repurchase Date is
the date originally agreed to by the parties pursuant to Paragraph 2(q) of
the Agreement, the Sell Back Price referred to in Paragraph 4(c)(ii) of
this Annex; and (ii) in any other case, the Sell Back Price referred to in
Paragraph 4(c)(ii) of this Annex.
7. For the avoidance of doubt, the parties acknowledge and agree that the
Purchase Price and the Sell Back
Price in Buy/Sell Back Transactions shall include Accrued Interest (except to
the extent contrary to market practice with respect to the Securities subject to
such Buy/Sell Back Transaction, in which event (i) an amount equal to the
Purchase Price plus Accrued Interest to the Purchase Date shall be paid to
Seller on the Purchase Date and shall be used, in lieu of the Purchase Price,
for calculating the Sell Back Differential, (ii) an amount equal to the Sell
Back Price plus the amount of Accrued Interest to the Repurchase Date shall be
paid to Buyer on the Repurchase Date, and (iii) the formula in Paragraph
4(c)(ii) of this Annex Vl shall be replaced by the formula "(P + Al + D) - (IR +
C)", where "AI" equals Accrued Interest to the Purchase Date).
8. Unless the parties agree in Annex I to the Agreement that a Buy/Sell Back
Transaction is not to be re-priced, they shall at the time of re-pricing
agree on the Purchase Price, the Sell Back Price and the Pricing Rate
applicable to such Transaction.
9. Paragraph 5 of the Agreement shall not apply to Buy/Sell Back Transaction.
Seller agrees, on the date such Income is received, to pay to Buyer any
Income received by Seller in respect of Purchased Securities that is paid
by the issuer on any date falling between the Purchased Date and the
Repurchase Date.
10. References to "Repurchase Price" throughout the Agreement shall be
construed as references to "Repurchase Price or the Sell Back Price, as the
case may be".
11. In Paragraph 11 of the Agreement, references to the "Repurchase Prices"
shall be construed as references to "repurchase Prices and Sell Back
Prices."
Annex VII
Transactions Involving Registered Investment Companies
This Annex VII (including any Schedules hereto) forms a part of the Master
Repurchase Agreement dated as of March 31, 1999, 19__ (the "Agreement") between
LNR CMBS Holdings Corp ("Counterparty") and each investment company identified
on Schedule Vll.A hereto (as such schedule may be amended from time to time)
acting on behalf of its respective series or portfolios identified on such
Schedule VII>A, or in the case of those investment companies for which no
separate series or portfolios are identified on such Schedule VII.A, or in the
case of those investment companies for which no separate series or portfolios
are identified on such Schedule VII.A, acting for and on behalf of itself (each
such series, portfolio or investment company, as the case may be, hereinafter
referred to as a "Fund"). In the event of any conflict between the terms of this
Annex VII and any other term of the Agreement, the terms of this Annex VII shall
prevail. Capitalized terms used but not defined in this Annex VII shall have the
meanings ascribed to them in the Agreement.
1. Multiple Funds. For any Transaction in which a fund is acting as Buyer (or
Seller, as the case may be), each reference in the Agreement and this Annex
Vll to Buyer (or Seller, as the case may be) shall be deemed a reference
solely to the particular Fund to which such Transaction relates, as
identified to Seller (or Buyer, as the case may be) by the Fund and as may
be specified in the Confirmation therefor. In no circumstances shall the
rights, obligations, or remedies of either party with respect to a
particular Fund constitute a right, obligation or remedy applicable to any
other Fund. Specifically, and without otherwise limiting the scope of this
Paragraph: (a) the margin maintenance obligations of Buyer and Seller
specified in Paragraph 4 or any other provisions of the Agreement and the
single agreement provisions of Paragraph 12 of the Agreement shall be
applied based solely upon Transactions entered into by a particular Fund,
(b) Buyer's and Seller's remedies under the Agreement upon the occurrence
of an Event of Default shall be determined as if each Fund had entered into
a separate Agreement with Counterparty, and (c) Seller and buyer shall have
no right to set off claims related to Transactions entered into by a
particular Fund against claims related to Transactions entered into by any
other Fund.
2. Margin Percentage. For any Transaction in which a Fund is acting as buyer,
the buyer's Margin Percentage shall always be equal to at least ___%, or
such other percentage as the parties hereto may from time to time mutually
determine: provided, that in no event shall such percentage be less than
100%. For any Transaction in which a Fund is acting as Seller, the Buyer's
Margin Percentage shall be such percentage as the parties hereto may from
time to time mutually determine; provided, that in no event shall such
percentage be less than 100%.
3. Confirmations. Unless otherwise agreed, Counterparty shall promptly issue a
Confirmation to the Fund pursuant to Paragraph 3 of the Agreement. Upon the
transfer of substituted or Additional Purchased Securities by either party,
Counterparty shall promptly provide notice to the Fund confirming such
transfer.
4. Financial condition. Each party represents that is has delivered the
following financial information to the other party to the Agreement: in the
case of a party that is a registered broker-dealer, its most recent
statements required to be furnished to customers by Rule 17a-5(c) under the
1934 Act; in the case of a party that is a Fund, its most recent audited or
unaudited financial statements required to be furnished to its shareholders
by Rule 30d-1 under the Investment Company Act of 1940; in the case of any
other party, its most recent audited or unaudited statements of financili
condition or other comparable information concerning its financial
condition.
Each party represents that the financial statements or information so
delivered fairly reflect its financial condition and, if applicable, its
net capital ratio, on the date as of which such financial statements or
information were prepared. Each party agrees that it will make available
and deliver to the other party, promptly upon request, all such financial
statements that subsequently are required to be delivered to its customers
or shareholders pursuant to Rule 17-a-5(c) or Rule 30d-1, as the case may
be, or, m in the case of a party that is neither a registered broker-dealer
nor a Fund, all such financial information that subsequently becomes
available to the public.
Each Fund acknowledges and agrees that it has made an independent
evaluation of the creditworthiness of the other party that is required
pursuant to the Investment Company Act of 1940 or the regulations
thereunder. Each fund agrees that its agreement to enter into each
transaction hereunder shall constitute an acknowledgement and agreement
that it has made such an evaluation.
5. Segregation of Purchased Securities. Unless otherwise agreed by the
parties, any transfer of Purchased Securities to a Fund shall be effected
by delivery or other transfer (in the manner agreed upon pursuant to
Paragraph 7 of the Agreement) to the custodian or subcustodian designated
for such Fund in Schedule VII.A hereto ("Custodian") for credit to the
Fund's custodial account with such Custodian. If the party effecting such
transfer is the Fund's Custodian, such party shall, unless otherwise
directed by the Fund, (a) transfer and maintain such Purchased Securities
to and in the Fund's custodial account with such party and (b) so indicate
in a notice to the Fund.
Schedule VII.A
Supplemental Terms and Conditions of Transactions
Involving Registered Investment Companies
This Schedule VII.A forms a part of Annex VII to the Master Repurchase Agreement
dated as of March 31, 1999, 19__ (the "Agreement") between Bear Xxxxxxx
International and LNR CMBS Holdings Corporation. Capitalized terms used but not
defined in this Schedule VII.A shall have the meanings ascribed to them in Annex
VII.
1. This Agreement is entered into by or on behalf of the following Fund, and
unless otherwise indicated by the appropriate Fund in connection with a
Transaction, the following Custodians are designated to receive transfers of
Purchased Securities on behalf of such Funds for credit to the appropriate
Fund's custodial account:
Name of Fund Custodian
------------ ---------
[ ]. Limitation of Liability. If the Fund is organized as a business trust (or
a series thereof), the parties agree as follows: [insert appropriate language
limiting liability or trustees, officers and others]
