Exhibit 10.123

 

EXECUTION COPY

 

AMENDMENT NO. 7 TO
SECURITY AGREEMENT

 

AMENDMENT NO. 7 TO SECURITY AGREEMENT, dated as of August 15, 2005 (the
“Amendment”), by and among FIRST INVESTORS RESIDUAL FUNDING LP (the “Debtor”),
FIRST INVESTORS FINANCIAL SERVICES, INC., as seller (the “Seller”) and WACHOVIA
CAPITAL MARKETS, LLC (successor in interest to First Union Securities, Inc.), as
the deal agent (the “Deal Agent”) and collateral agent (the “Collateral Agent”).

 

W I T N E S S E T H:

 

WHEREAS, the parties hereto entered into the Security Agreement, dated as of
December 6, 2001 (as amended, modified and waived to the date hereof, the
“Security Agreement”); and

 

WHEREAS, the parties to the Security Agreement desire to make certain amendments
to the Security Agreement;

 

NOW, THEREFORE, in consideration of the foregoing, and the respective
agreements, warranties and covenants contained herein, the parties hereto agree,
covenant and warrant as follows:

 

SECTION 1. DEFINITIONS

 

1.1          Interpretation.  All capitalized terms used herein (including the
recitals hereto) shall have the respective meanings assigned thereto in the
Security Agreement unless otherwise defined herein.

 

1.2          Revised Definitions.

 

(a)           The definition of “Termination Date” in Section 1.1 of the
Agreement is hereby modified, amended and restated to read in its entirety as
follows:

 

“Termination Date: The earliest of (1) the day on which a Termination Event
occurs, (2) February 15, 2006 or such later date to which the Termination Date
may be extended, if extended, in the sole discretion of each Noteholder or
(3) the Business Day specified in a written notice from the Debtor to the Deal
Agent and the Collateral Agent.”

 

SECTION 2. [reserved]

 

SECTION 3. REPRESENTATIONS, WARRANTIES AND COVENANTS

 

Debtor and Seller each hereby represents, warrants that each of the
representations and warranties made by or on behalf of such Person in any of the
Transaction Documents was true

 

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and correct when made and is true and correct on and as of the date of this
Amendment with the same full force and effect as if each of such representations
and warranties had been made by such Person on the date hereof and in this
Amendment. Debtor and the Seller each further represents and warrants to the
Deal Agent, each Secured Party and the Collateral Agent that: (i) the execution,
delivery and performance by it of this Amendment are within its corporate powers
or limited partnership powers, as the case may be, have been duly authorized by
all necessary action, will not violate any requirement of law or contractual
obligation of Debtor or Seller and will not result in, or require, the creation
or imposition of any lien on any of their respective properties or revenues,
(iii) no authorization or approval or other action by, and no notice or filing
with, any governmental authority or regulatory body is required for the due
execution, delivery and performance by it of this Amendment, (iv) this Amendment
is its legal, valid and binding obligation, enforceable against it in accordance
with its terms, except as such enforceability may be limited by bankruptcy,
insolvency, reorganization or similar laws affecting creditors’ rights generally
and (v) it is in compliance with all applicable Requirements of Law. The
representations and warranties set forth above shall survive the execution of
this Amendment.

 

SECTION 4. EFFECTIVENESS OF THIS AMENDMENT

 

The terms and provisions of this Amendment shall be effective on the last to
occur of receipt by the Deal Agent of (a) an original of this Amendment fully
executed by each of the parties hereto, (b) receipt by the Deal Agent by wire
transfer in immediately available funds of a renewal fee in the amount of
$250,000, which fee shall be fully earned and not refundable in whole or in part
upon the execution and delivery of this Amendment and (c) an original of the
amendment to the Note Purchase Agreement (in form and substance satisfactory to
the Deal Agent), dated the date hereof, fully executed by each of the parties
thereto.

 

SECTION 5. PROVISIONS OF GENERAL APPLICATION

 

5.1          Effect of this Amendment.  Except as modified pursuant hereto, no
other changes or modifications to the Transaction Documents are intended or
implied and in all other respects each of the Transaction Documents are hereby
specifically ratified, restated and confirmed by all parties hereto as of the
effective date hereof. To the extent of conflict between the terms of this
Amendment and any other Transaction Document, the terms of this Amendment shall
control. The Security Agreement and this Amendment shall be read and construed
as one agreement.

 

5.2          Further Assurances.  Debtor and Seller shall execute and deliver
such additional documents and take such additional action as may, in the opinion
of the Deal Agent, be necessary or desirable to effectuate the provisions and
purposes of this Amendment.

 

5.3          Binding Effect.  This Amendment shall be binding upon and inure to
the benefit of each of the parties hereto and their respective successors and
assigns.

 

5.4          Survival of Representations and Warranties.  All representations
and warranties made in this Amendment or any other document furnished in
connection with this

 

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Amendment shall survive the execution and delivery of this Amendment and the
other documents, and no investigation by the Deal Agent, the Collateral Agent or
any Secured Party or any closing shall affect the representations and warranties
or the right of Lenders to rely upon them.

 

5.5          Severability.  Any provision of this Amendment held by a court of
competent jurisdiction to be invalid or unenforceable shall not impair or
invalidate the remainder of this Amendment.

 

5.6          Governing Law.  THIS AMENDMENT SHALL BE GOVERNED BY, AND CONSTRUED
AND ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO
CONTRACTS MADE AND PERFORMED IN SUCH STATE, WITHOUT REFERENCE TO ITS CONFLICT OF
LAWS PROVISIONS (OTHER THAN SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS
LAW).

 

5.8          Counterparts.  This Amendment may be executed in any number of
counterparts, but all of such counterparts shall together constitute but one and
the same agreement.

 

 

[Remainder of Page Intentionally Left Blank]

 

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IN WITNESS WHEREOF, this Amendment is executed and delivered as of the day and
year first above written.

 

 

DEBTOR:

FIRST INVESTORS RESIDUAL FUNDING LP

 

 

 

By: FIALAC Holdings, Inc., its sole general partner

 

 

 

By:

/s/ Bennie H. Duck

 

 

Name: Bennie H. Duck

 

Title: Vice President and Chief Financial Officer

 

 

 

 

SELLER:

FIRST INVESTORS FINANCIAL SERVICES, INC.

 

 

 

By:

/s/ Bennie H. Duck

 

 

Name: Bennie H. Duck

 

Title: Vice President and Chief Financial Officer

 

 

[Additional Signatures to Follow]

 

 

[Signature Page to Amendment No. 7 to Security Agreement]

 

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NOTE INVESTOR:

VARIABLE FUNDING CAPITAL CORPORATION,

 

 

 

By:  Wachovia Capital Markets, LLC,

 

 

as attorney-in-fact

 

 

 

 

 

 

 

By:

 /s/ Douglas R. Wilson, SR.

 

 

Name:

 DOUGLAS R. WILSON, SR.

 

 

Title:

 VICE PRESIDENT

 

 

 

 

 

DEAL AGENT and

 

COLLATERAL AGENT

WACHOVIA CAPITAL MARKETS, LLC,

 

 

 

 

 

By:

 /s/ Justin Zakocs

 

 

Name:

 Justin Zakocs

 

 

Title:

 Vice President

 

 

 

[End of Signatures]

 

 

[Signature Page to Amendment No. 7 to Security Agreement]

 

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