FIRST AMENDMENT TO
FIRST AMENDED AND RESTATED
WAREHOUSING CREDIT AND SECURITY AGREEMENT
FIRST AMENDMENT TO FIRST AMENDED AND RESTATED WAREHOUSING CREDIT AND SECURITY
AGREEMENT (this "Amendment") dated as of September 30, 2003, between AMERICAN
BUSINESS CREDIT, INC., a Pennsylvania corporation, AMERICAN BUSINESS MORTGAGE
SERVICES, INC., a New Jersey corporation, and HOMEAMERICAN CREDIT, INC., a
Pennsylvania corporation (collectively, the "Borrowers", and individually, as
"Co-Borrower"), and RESIDENTIAL FUNDING CORPORATION, a Delaware corporation
("Lender").
A. Borrowers and Lender have entered into a revolving mortgage
warehousing facility with a present Warehousing Commitment
Amount of $25,000,000 which is evidenced by a Promissory Note
dated July 1, 2002 (the "Note"), and by a First Amended and
Restated Warehousing Credit and Security Agreement dated as of
July 1, 2002 (as the same may have been and may be amended or
supplemented, the "Agreement").
B. Borrowers have requested that Lender waive its default rights
in connection with an Event of Default under the Agreement,
and Lender has agreed to such waiver, subject to the terms and
conditions of this Amendment.
NOW, THEREFORE, the parties to this Amendment agree as follows:
1. Subject to Borrowers' satisfaction of the conditions set forth
in Section 5, the effective date of this Amendment is
September 30, 2003 ("Effective Date").
2. Unless otherwise defined in this Amendment, all capitalized
terms have the meanings given to those terms in the Agreement.
Defined terms may be used in the singular or the plural, as
the context requires. The words "include," "includes" and
"including" are deemed to be followed by the phrase "without
limitation." Unless the context in which it is used otherwise
clearly requires, the word "or" has the inclusive meaning
represented by the phrase "and/or." References to Sections and
Exhibits are to Sections and Exhibits of this Amendment unless
otherwise expressly provided.
3. Article 1 of the Agreement is amended and restated in its
entirety as set forth in Article 1 attached to this Amendment.
All references in the Agreement and other Loan Documents to
Article 1 (including each and every Section in Article 1) are
deemed to refer to the new Article 1.
4. Pursuant to Section 8.10 of the Agreement, Guarantor's net
income must not be less than zero for any 2 consecutive
Calendar Quarters. Guarantor reported a net loss of
$34,000,000 for the Calendar Quarter ending June 30, 2003 and
a net loss of $29,900,000 for fiscal year ending June 30,
2003. Borrowers have informed Lender that a projected net loss
will be reported for the Calendar Quarter ending September 30,
2003 ("Net Income Default"). Pursuant to Section 10.1(c) of
the Agreement, a violation of any Section in Article 8 by
Borrowers or Guarantor is an immediate Event of Default,
entitling Lender to exercise all rights it has under the
Agreement and the Loan Documents delivered in connection with
the Agreement, including the right to accelerate the
Obligations. Borrowers have requested that Lender waive the
Net Income Default. Lender hereby agrees to waive the Net
Income Default, provided that, notwithstanding any provision
of the Agreement, no Warehousing Advances will be made by
Lender on or after September 30, 2003. Lender expressly
reserves all of its rights and remedies available to it under
the Loan Documents, including the right to accelerate the
Obligations, upon the occurrence of any Event of Default other
than the Net Income Default. Any delay by Lender in enforcing
those rights and remedies will not constitute a waiver thereof
and will not impair Lender's right to exercise those rights
and remedies in the future.
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5. Borrowers must deliver to Lender (a) two executed copies of
this Amendment, and (b) a $350 document production fee.
6. Borrowers represent, warrant and agree that (a) except as set
forth in paragraph 4 above, there exists no Default or Event
of Default under the Loan Documents, (b) the Loan Documents
continue to be the legal, valid and binding agreements and
obligations of Borrowers, enforceable in accordance with their
terms, as modified by this Amendment, (c) Lender is not in
default under any of the Loan Documents and Borrowers have no
offset or defense to its performance or obligations under any
of the Loan Documents, and (d) except for changes permitted by
the terms of the Agreement, Borrowers' representations and
warranties contained in the Loan Documents are true, accurate
and complete in all respects as of the Effective Date.
7. Except as expressly modified, the Agreement is unchanged and
remains in full force and effect, and Borrowers ratify and
reaffirm all of their obligations under the Agreement and the
other Loan Documents.
8. This Amendment may be executed in any number of counterparts,
each of which will be deemed an original, but all of which
shall together constitute but one and the same instrument.
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IN WITNESS WHEREOF, Borrowers and Lender have caused this Amendment to be duly
executed on their behalf by their duly authorized officers as of the day and
year above written.
AMERICAN BUSINESS CREDIT, INC.,
a Pennsylvania corporation
By: /s/ Xxxxxx X. Xxxxxx
-------------------------------------------
Its: Executive Vice President and
Chief Financial Officer
AMERICAN BUSINESS MORTGAGE SERVICES, INC.,
a New Jersey corporation
By: /s/ Xxxxxx X. Xxxxxx
-------------------------------------------
Its: Executive Vice President and
Chief Financial Officer
HOMEAMERICAN CREDIT, INC.,
a Pennsylvania corporation
By: /s/ Xxxxxx X. Xxxxxx
-------------------------------------------
Its: Executive Vice President and
Chief Financial Officer
RESIDENTIAL FUNDING CORPORATION,
a Delaware corporation
By: /s/ Xxxxx Xxxxxx
-------------------------------------------
Its: Director
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CONSENT OF GUARANTOR
The undersigned, being the Guarantor under a Guaranty dated July 1, 2002 (the
"Guaranty"), consents to the foregoing Amendment and the transactions
contemplated by it, and ratifies and reaffirms its obligations under the
Guaranty so as to include within the term "Guaranteed Debt" the indebtedness,
obligations and liabilities of Borrower under this Amendment, the Agreement as
modified by this Amendment, the Note and the other Loan Documents. The Guarantor
hereby reaffirms that its obligations under the Guaranty are separate and
distinct from Borrower's, obligations to Lender, and that its obligations under
the Guaranty are in full force and effect. Finally, the Guarantor waives and
agrees not to assert any anti-deficiency protections or other rights as a
defense to its obligations under the Guaranty, all as set forth in the Guaranty,
the terms of which are incorporated into this Consent as if fully set forth in
it.
Dated: 10/14/03
American Business Financial Services, Inc.,
a Delaware corporation
By: /s/ Xxxxxx X. Xxxxxx
---------------------------------------
Its: Executive Vice President and
Chief Financial Officer
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FIRST AMENDED AND RESTATED WAREHOUSING CREDIT
AND SECURITY AGREEMENT
FIRST AMENDED AND RESTATED WAREHOUSING CREDIT AND SECURITY AGREEMENT, dated as
of July 1, 2002 between AMERICAN BUSINESS CREDIT, INC., a Pennsylvania
corporation ("ABCI"), AMERICAN BUSINESS MORTGAGE SERVICES, INC., a New Jersey
corporation ("ABMSI"), and HOMEAMERICAN CREDIT, INC., a Pennsylvania corporation
("HACI") (ABCI, ABMSI and HACI collectively, "Borrower"), and RESIDENTIAL
FUNDING CORPORATION, a Delaware corporation ("Lender").
A. Borrower has requested certain financing from Lender.
B. Borrower has asked Lender to amend and restate the Existing
Agreement (as defined below) and to set forth the terms and
conditions upon which Lender will provide certain financing to
Borrower.
C. Borrower and Lender have agreed to amend and restate the
Existing Agreement to provide that financing to Borrower
subject to the terms and conditions of this Agreement.
D. Subject to Borrower's satisfaction of the conditions set forth
in Article 5, the "Closing Date" for the transactions
contemplated by this Agreement is August 31, 2002.
NOW, THEREFORE, the parties to this Agreement agree as follows:
1. THE CREDIT
1.1 The Warehousing Commitment
On the terms and subject to the conditions and limitations of this Agreement,
including Exhibit H, Lender agrees to make Warehousing Advances to Borrower from
the Closing Date to, but not including, September 30, 2003, during which period
Borrower may borrow, repay and reborrow in accordance with the provisions of
this Agreement. The total aggregate principal amount of all Warehousing Advances
outstanding at any one time may not exceed the Warehousing Commitment Amount.
While a Default or Event of Default exists, Lender may refuse to make any
additional Warehousing Advances to Borrower. Effective as of the Closing Date,
all outstanding loans made under the Existing Agreement are deemed to be
Warehousing Advances made under this Agreement. All Warehousing Advances under
this Agreement constitute a single indebtedness, and all of the Collateral is
security for the Warehousing Note and for the performance of all of the
Obligations. Warehousing Advances will be made to ABMSI, HACI or ABCI, as
requested by ABMSI, HACI or ABCI, will be deemed made to or for the benefit of
ABMSI, HACI and ABCI, and ABMSI, HACI and ABCI, jointly and severally, are
obligated to repay any Warehousing Advances made to ABMSI, HACI or ABCI under
the Warehousing Commitment. With respect to its obligation to repay Warehousing
Advances made to the other Borrower, each Borrower agrees to the terms set forth
in Exhibit J.
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1.2 Warehousing Maturity Date
"Warehousing Maturity Date" means the earliest of: (a) October 31, 2003, (b) the
date the Warehousing Advances become due and payable under Section 10.2, (c) the
date Lender, in its sole discretion, declares all Obligations due and payable.
1.3 Warehousing Note
Warehousing Advances are evidenced by Borrower's promissory note, payable to
Lender on the form prescribed by Lender ("Warehousing Note"). The term
"Warehousing Note" as used in this Agreement includes all amendments,
restatements, renewals or replacements of the original Warehousing Note and all
substitutions for it. All terms and provisions of the Warehousing Note are
incorporated into this Agreement.
End of Article 1
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