Exhibit 10.1(a)

 

PROMISSORY NOTE

 

U.S. $40,000,000.00

 

February 10, 2017

 

 

Phoenix, Arizona

 

 

 

 

FOR VALUE RECEIVED, IMPAC MORTGAGE CORP., a California corporation (“Borrower”),
hereby promises to pay to the order of WESTERN ALLIANCE BANK, an Arizona
corporation (“Bank”), at the office of Bank located at 3033 West Ray Road,
Chandler AZ 85226, the principal amount of Forty Million and No/100 Dollars
($40,000,000.00) or such lesser principal amount as from time to time shall be
outstanding hereunder, as reflected in the books and records of Bank, together
with interest on the principal balance from time to time outstanding hereunder,
from (and including) the date of disbursement until (but not including) the date
of payment, at a per annum rate equal to the Stated Interest Rate specified
below or, to the extent applicable, the Default Interest Rate specified below,
in accordance with the following terms and conditions:

 

1.             Definitions.  As used herein, the following terms shall have the
following meanings.  Capitalized terms not otherwise defined herein shall have
the meanings ascribed to them in the Loan and Security Agreement dated
February 10, 2017 between Borrower and Bank (as amended from time to time, the
“Loan Agreement”). All terms defined in this Section 1 or in other provisions of
this Note in the singular to have the same meanings when used in the plural and
vice versa.

 

“Additional Sums” has the meaning set forth in Section 14 of this Note.

 

“Business Day” has the meaning provided in the Loan Agreement.

 

“Conversion Date” means the earlier of (i) the two (2) year anniversary of the
Effective Date; or (ii) if the Bank elects upon the occurrence and continuation
of an Event of Default.

 

“Default Interest Rate” has the meaning set forth in Section 4 of this Note.

 

“Event of Default” has the meaning set forth in the Loan Agreement.

 

“Index Rate” shall mean the LIBOR Rate, reset on the 1st Business Day of each
month.”

 

“LIBOR Rate” shall mean the variable rate of interest per annum, as adjusted
from time to time, quoted by Bank as Bank’s one (1) month LIBOR Rate based upon
quotes from the London Interbank Offered Rate from the ICE Benchmark
Administration Interest Settlement Rates, as quoted for U.S. Dollars by
Bloomberg, or other comparable services selected by Bank.  The LIBOR Rate is
only one of Bank’s reference rates. If the Libor Rate becomes unavailable during
the term of the Loan, Bank may designate a substantially equivalent substitute
index.  Any increase or decrease in the LIBOR Rate, for purposes of determining
the Stated Interest Rate in effect hereunder, shall be effective on the day
either such increase or decrease is announced or published, as the case may be.

 

“Loan Documents” has the meaning set forth in Section 12 of this Note.

 

“Note” means this Promissory Note.

 

“Reset Dates” shall mean annually on the anniversary of the Effective Date.

 

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“Revolving Loan Period” means the period beginning on the Effective Date and
ending on the Conversion Date.

 

“Stated Interest Rate” has the meaning set forth in Section 3 of this Note.

 

“Term Loan Period” means the period beginning on the Conversion Date and ending
on the one (1) year anniversary of such Conversion Date.

 

2.             Contracted For Rate of Interest.  The contracted for rate of
interest of the indebtedness evidenced hereby, without limitation, shall consist
of the following:

 

(a)           The Stated Interest Rate, as from time to time in effect,
calculated daily on the basis of actual days elapsed over a 360-day year,
applied to the principal balance from time to time outstanding hereunder;

 

(b)           The Default Interest Rate, as from time to time in effect,
calculated daily on the basis of actual days elapsed over a 360-day year,
applied to the principal balance from time to time outstanding hereunder;

 

(c)           All Additional Sums, if any.

 

Borrower agrees to pay an effective contracted for rate of interest which is the
sum of the Stated Interest Rate referred to in Subsection 2(a) above, plus any
additional rate of interest resulting from the application of the Default
Interest Rate referred to in Subsection 2(b) above, and the Additional Sums, if
any, referred to in Subsection 2(c) above.

 

3.             Stated Interest Rate. Except as provided in Section 4 below, the
principal balance outstanding hereunder from time to time shall bear interest at
the Stated Interest Rate. The Stated Interest Rate shall be equal to a per annum
rate equal to 4.00% plus the Index Rate from time to time in effect. However, if
the Borrower’s custodial deposit accounts associated with the Pledged Servicing
Rights are not moved to the Bank within ninety (90) days of the Effective Date,
the Stated Interest Rate during the Loan Period shall increase to the Index Rate
plus 4.50% per annum. Borrower acknowledges that the Stated Interest Rate may
not represent the most favorable interest rate from time to time offered by Bank
to its borrowers, the Stated Interest Rate may increase or decrease prior to the
Effective Date, and the amount by which the Stated Interest Rate may increase is
not limited as to increases that may occur.

 

4.             Default Interest Rate.  The Default Interest Rate shall be a per
annum rate equal to the Stated Interest Rate plus four percent (4.00%) per
annum.  The principal balance outstanding hereunder from time to time shall, at
Bank’s election, bear interest at the Default Interest Rate from the date of the
occurrence of an Event of Default hereunder until the earlier of: (a) the date
on which the principal balance outstanding hereunder, together with all accrued
interest and other amounts payable hereunder, are paid in full; or (b)(i) if
Borrower is specifically granted a right to cure such Event of Default in any of
the Loan Documents, the date on which such Event of Default is timely cured in a
manner satisfactory to Bank or (ii) if no such right to cure is specifically
granted, then the date on which Bank, in its sole and absolute discretion, deems
such Event of Default cured.

 

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5.             Late Charge. If any payment of principal and/or interest, or
other amount is not received by Bank within ten (10) days after its due date,
and Bank has not implemented the Default Interest Rate, then, in addition to the
other rights and remedies of Bank, a late charge of (i) five percent (5.00%) of
the amount due and unpaid; or (ii) $10.00, whichever is greater, will be charged
to the Borrower without notice to Borrower.  Such late charge shall be
immediately due and payable.

 

6.             Principal Balance.  The principal balance outstanding hereunder
at any time shall be the total amount of advances made hereunder by Bank, less
the total amount of payments of principal hereon, as reflected in the books and
records of Bank with respect to the indebtedness evidenced hereby.  The
principal balance outstanding hereunder at any time shall not exceed the
principal amount first set forth above.

 

7.             Revolving Credit/Term Loan.  This Note is the Promissory Note
defined in the Loan Agreement.  During the Revolving Loan Period, Bank may make
advances to Borrower from time to time hereunder, which advances will be of a
revolving nature and may be made, repaid, and remade from time to time.  During
the Revolving Loan Period, Borrower and Bank contemplate a series of
discretionary advances as provided herein even if the principal balance
outstanding hereunder has previously been reduced to zero.  On the Conversion
Date, and provided that no Event of Default has occurred and is continuing
hereunder or under any other Loan Document, any outstanding principal and
interest due hereunder shall, without any further action by Bank or Borrower, be
converted to the principal due under a term loan (the “Term Loan”) payable in
accordance with the terms of this Note.  After the Conversion Date, and at all
times during the Term Loan Period, any principal amounts repaid or prepaid by
Borrower may not be re-borrowed.

 

8.             Requests for Advances.  Advances hereunder may be made by Bank
from time to time during the Revolving Loan Period by the written request of
Kathy Hancock, Todd Taylor, William Ashmore or such other officer of the
Borrower as Borrower may from time to time designate to Bank in writing.  Any
advance hereunder shall be deemed to have been made to or for the benefit of
Borrower when made pursuant to the oral or written request of any one of the
aforenamed individuals.

 

9.             Payments.  This Note shall be payable as follows:

 

(a)           Interest during Revolving Loan Period.  During the Revolving Loan
Period, accrued and unpaid interest at the Stated Interest Rate or, to the
extent applicable, the Default Interest Rate, shall be payable in arrears
commencing on January 1, 2017, and on the 1st day of each month thereafter (or
if such day is not a Business Day, on the next Business Day) if on such day any
interest is accrued and unpaid; and

 

(b)           Principal and Interest during Term Loan Period.  Borrower shall
make monthly payments of interest during the Term Loan Period, commencing on the
one-month anniversary of the Conversion Date and continuing on the same day of
each month until the last day of the Term Loan Period. In addition, Borrower
shall make quarterly payments of principal during the Term Loan Period,
commencing on the date that is 90 days after the Conversion Date, and continuing
every 90 days thereafter until paid in full.  Each monthly payment shall be each
in an amount equal to one quarter of the outstanding principal balance on the
Conversion Date.  On the one (1) year anniversary of the Conversion Date, all
outstanding principal, accrued and unpaid interest, and any other amounts due
under the Loan Documents, shall be paid in full.

 

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10.          Application of Payments.  Payments received by Bank with respect to
the indebtedness evidenced hereby shall be applied as provided in the Loan
Agreement.

 

11.          Prepayments.

 

(a)           The Borrower may, upon notice to Lender, at any time or from time
to time, voluntarily prepay principal under this Note, in whole or in part.

 

(b)           Notwithstanding any prepayment of principal hereof: (a) all
previously matured interest and other charges accrued to the date of prepayment
must also be paid in full (b) there will be no change in the due date or amount
of scheduled payments due hereunder unless Bank, in its sole and absolute
discretion, agrees in writing to such change; and (c) Borrower’s obligations
hereunder shall continue in effect, and this Note shall remain outstanding,
unless and until the principal balance outstanding hereunder, together with all
accrued interest and other amounts payable hereunder or in any of the Loan
Documents, are paid in full.

 

12.          Events of Default.  The occurrence of an Event of Default under the
Loan Agreement, shall constitute an Event of Default under this Note.

 

13.          Collateral.

 

(a)           Borrower’s obligations under this Note are secured by a security
interest in certain personal property of Borrower pursuant to the Loan
Agreement.

 

(b)           In addition to all liens upon, and rights of setoff against, the
monies, securities or other property of Borrower or any other person or entity
who is or may become liable hereunder given to Bank by law, Bank shall have a
lien and a right of setoff against, and Borrower hereby grants to Bank a
security interest in, all monies, securities and other property of Borrower now
or hereafter in the possession of or on deposit with Bank, whether held in a
general or special account or deposit including, without limitation, any account
or deposit held jointly by Borrower with any other person or entity, except to
the extent specifically prohibited by law and expressly excluding any escrow or
custodial accounts.  Every such lien, right of setoff and security interest may
be exercised without demand upon or notice to Borrower.  No lien, right of
setoff, or security interest shall be deemed to have been waived by any act or
conduct on the part of Bank, by any neglect to exercise such right of setoff or
to enforce such lien or security interest, or by any delay in so doing.

 

14.          Additional Sums.  All fees, charges, goods, things in action or any
other sums or things of value, other than the interest resulting from the Stated
Interest Rate, the Default Interest Rate, as applicable, paid or payable by
Borrower (collectively, the “Additional Sums”), whether pursuant to this Note,
the Loan Documents or any other document or instrument in any way pertaining to
this lending transaction, or otherwise with respect to this lending transaction,
that, under the laws of the State of Arizona, may be deemed to be interest with
respect to this lending transaction, for the purpose of any laws of the State of
Arizona that may limit the maximum amount of interest to be charged with respect
to this lending transaction, shall be payable by Borrower as, and shall be
deemed to be, additional interest, and for such purposes only, the agreed upon
and “contracted for rate of interest” of this lending transaction shall be
deemed to be increased by the rate of interest resulting from the Additional
Sums.  Borrower understands and believes that this lending transaction complies
with the usury laws of the State of Arizona; however, if any interest or other
charges in connection with this lending transaction are

 

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ever determined to exceed the maximum amount permitted by law, then Borrower
agrees that: (a) the amount of interest or charges payable pursuant to this
lending transaction shall be reduced to the maximum amount permitted by law; and
(b) any excess amount previously collected from Borrower in connection with this
lending transaction that exceeded the maximum amount permitted by law, will be
credited against the principal balance then outstanding hereunder.  If the
outstanding principal balance hereunder has been paid in full, the excess amount
paid will be refunded to Borrower.

 

15.          Waivers.  Except as set forth in this Note, the Loan Agreement or
the other Loan Documents, to the extent permitted by applicable law, Borrower,
and each person who is or may become liable hereunder, severally waive and agree
not to assert:  (a) any homestead or exemption rights; (b) demand, diligence,
grace, presentment for payment, protest, notice of nonpayment, nonperformance,
extension, dishonor, maturity, protest and default; and (c) recourse to guaranty
or suretyship defenses (including, without limitation, the right to require the
Bank to bring an action on this Note).  Bank may extend the time for payment of
or renew this Note, release collateral as security for the indebtedness
evidenced hereby or release any party from liability hereunder, and any such
extension, renewal, release or other indulgence shall not alter or diminish the
liability of Borrower or any other person or entity who is or may become liable
on this Note except to the extent expressly set forth in a writing evidencing or
constituting such extension, renewal, release or other indulgence.

 

16.          Costs of Collection.  Borrower agrees to pay all costs of
collection, including, without limitation, reasonable attorneys’ fees, whether
or not suit is filed, and all costs of suit and preparation for suit (whether at
trial or appellate level), in the event any payment of principal, interest or
other amount is not paid when due, or in case it becomes necessary to protect
the collateral which is security for the indebtedness evidenced hereby, or to
exercise any other right or remedy hereunder or in the Loan Documents, or in the
event Bank is made party to any litigation because of the existence of the
indebtedness evidenced by this Note or the other Loan Documents, or if at any
time Bank should incur any attorneys’ fees in any proceeding under any federal
bankruptcy law (or any similar state or federal law) in connection with the
indebtedness evidenced by this Note or the other Loan Documents.  In the event
of any court proceeding, reasonable attorneys’ fees shall be set by the court
and not by the jury and shall be included in any judgment obtained by Bank.

 

17.          No Waiver by Bank.  No delay or failure of Bank in exercising any
right hereunder shall affect such right, nor shall any single or partial
exercise of any right preclude further exercise thereof.

 

18.          GOVERNING LAW; PLACE OF PERFORMANCE.  THIS NOTE IS BEING EXECUTED
AND DELIVERED, AND IS INTENDED TO BE PERFORMED IN, THE STATE OF ARIZONA, AND THE
LAWS OF SUCH STATE (WITHOUT REGARD TO ITS PROVISIONS OF CHOICE OF LAWS) AND OF
THE UNITED STATES SHALL GOVERN THE RIGHTS AND DUTIES OF THE PARTIES HERETO AND
THE VALIDITY, CONSTRUCTION, ENFORCEMENT, AND INTERPRETATION OF THIS NOTE, EXCEPT
TO THE EXTENT OTHERWISE SPECIFIED IN ANY OF THE LOAN DOCUMENTS.  THIS NOTE IS
PERFORMABLE IN MARICOPA COUNTY, ARIZONA.  VENUE OF ANY LITIGATION INVOLVING THIS
NOTE SHALL BE MAINTAINED IN AN APPROPRIATE STATE OR FEDERAL COURT LOCATED IN
MARICOPA COUNTY, ARIZONA, TO THE EXCLUSION OF ALL OTHER VENUES.

 

19.          Time of Essence.  Time is of the essence of this Note and each and
every provision hereof.

 

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20.          Amendments.  No amendment, modification, change, waiver, release or
discharge hereof and hereunder shall be effective unless evidenced by an
instrument in writing and signed by the party against whom enforcement is
sought.

 

21.          Severability.  If any provision hereof is invalid or unenforceable,
the other provisions hereof shall remain in full force and effect and shall be
liberally construed in favor of Bank in order to effectuate the other provisions
hereof.

 

22.          Binding Nature.  The provisions of this Note shall be binding upon
Borrower and the heirs, personal representatives, successors and assigns of
Borrower, and shall inure to the benefit of Bank and any subsequent holder of
all or any portion of this Note, and their respective successors and assigns. 
Bank may from time to time transfer all or any part of its interest in this Note
and the Loan Documents, without notice to Borrower.

 

23.          Notice.  All notices, requests, consents and other communications
hereunder shall be in writing and shall be delivered personally or mailed by
first-class registered or certified mail, postage prepaid, or by facsimile
transmission, overnight delivery service or email, postage prepaid, to Bank at
its address first set forth above and to Borrower at its address shown on the
signature pages of this Note or at such other address as may be designated by it
by notice to the other party. All notices and other communications given to any
party hereto in accordance with the provisions of this Note shall be deemed to
have been given on the date of receipt.

 

24.          Section Headings.  The section headings set forth in this Note are
for convenience only and shall not have substantive meaning hereunder or be
deemed part of this Note.

 

25.          Construction.  This Note shall be construed as a whole, in
accordance with its fair meaning, and without regard to or taking into account
any presumption or other rule of law requiring construction against the party
preparing this Note.  If the day on which any action to be performed or any
payment made hereunder is not a business day, such action shall be performed or
such payment made on the immediately succeeding business day.

 

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IN WITNESS WHEREOF, Borrower has executed this Note as of the date first set
forth above.

 

 

BORROWER:

 

 

 

IMPAC MORTGAGE CORP., a California corporation

 

 

 

By:

/s/ William Ashmore

 

Name:

William Ashmore

 

Title:

President

 

 

 

 

Address of Borrower:

 

 

 

IMPAC Mortgage Corp.

 

 

 

 

 

Facsimile:

 

Email:

 

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