Franklin Credit Management Corporation 10-12G


Exhibit 10.9 

Execution Copy 

CONFIDENTIAL
TREATMENT REQUESTED 

INFORMATION FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED IS
OMITTED AND IS IDENTIFIED BY THREE ASTERISKS, AS FOLLOWS “***”, AN UNREDACTED
VERSION OF THIS DOCUMENT HAS BEEN FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION 

SECOND AMENDMENT TO
LOAN SERVICING AGREEMENT 

SECOND AMENDMENT, dated as of October 29, 2009 (this “ Second
Amendment”), to the Loan Servicing Agreement, dated as of May 28, 2008, as
amended by the First Amendment to Loan Servicing Agreement, dated as of
February 23, 2009 (such agreement, as so amended, the “Loan Servicing
Agreement”), by and among, on the one hand, Bosco Credit LLC (“Bosco”), as
owner, and Franklin Credit Management Corporation, as servicer (the “Servicer”).


WHEREAS, Bosco and the Servicer desire to amend the Loan Servicing
Agreement in accordance with the terms hereof. 

NOW
THEREFORE, in consideration of the premises and other good and valuable
consideration, the parties hereto hereby agree as follows: 

1. Definitions. Any capitalized term used herein and not
defined shall have the meaning assigned to it in the Loan Servicing Agreement,
as amended by this Second Amendment (the Loan Servicing Agreement as amended by
this Second Amendment being called the “Amended Loan Servicing Agreement”) or
the Loan Agreement, dated as of May 28, 2008 (the “Loan Agreement”), among
the Borrowers, the Lenders party thereto, the Administrative Agent, and First
City Servicing Corporation, as Surveillance Agent, as amended. 

2. Amendments. Effective on the Second Amendment
Effective Date (as defined below) and subject to the satisfaction of the
conditions precedent set forth in Section 3 below, the parties hereto agree
as follows: 

2.1
Exhibit D to the Loan Servicing Agreement is amended by deleting
Exhibit D in its entirety and replacing it with Exhibit D to this
Second Amendment. 

3. Conditions to Effectiveness. The effectiveness of this
Second Amendment is subject to the fulfillment, in a manner satisfactory to the
Administrative Agent, of each of the following conditions precedent (the date
such conditions are fulfilled or waived by the Administrative Agent is
hereinafter referred to as the “Second Amendment Effective Date”): 

(a) The representations and warranties of the Servicer and Bosco
set forth herein, in Section 6 of the Loan Servicing Agreement and in each other
Loan Document and certificate or other writing delivered to the Administrative
Agent pursuant hereto on or prior to the Second Amendment Effective Date shall
be correct in all material respects after giving effect to this Second Amendment
on and as of the Second Amendment Effective Date as though made on and as of
such date (except to the extent such representations and warranties expressly
relate to an earlier date), and following the execution of this Second
Amendment, no Default or Event of Default shall have occurred and be continuing
on the Second Amendment Effective Date or would result from this Second
Amendment becoming effective in accordance with its terms;













 




(b) Bosco and the Servicer shall have executed this Second
Amendment and shall have received a counterpart to this Second Amendment;

(c) Bosco and the Servicer shall have delivered such other
agreements, documents and instruments as Administrative Agent may otherwise
require, all of which shall be in form and substance satisfactory to
Administrative Agent and its legal counsel;

(d) Bosco shall have reimbursed Administrative Agent and
Servicer for all reasonable legal and other fees incurred by Administrative
Agent and Servicer in connection with the preparation of this Second Amendment;
and

(e) All proceedings taken in connection with the transactions
contemplated by this Second Amendment and all documents, instruments and other
legal matters incident thereto shall be satisfactory to Administrative Agent and
its counsel.

4. Representations and Warranties. Each of Bosco and the
Servicer represents and warrants as follows: 

(a) The execution, delivery and performance by each of Bosco and
the Servicer of this Second Amendment and the performance by each of Bosco and
the Servicer of the Amended Loan Servicing Agreement have been duly authorized
by all necessary action by each of Bosco and the Servicer, and each of Bosco and
the Servicer have all requisite power, authority and legal right to execute,
deliver and perform this Second Amendment and to perform the Amended Loan
Servicing Agreement.

(b) This Second Amendment and the Amended Loan Servicing
Agreement are the legal, valid and binding obligations of each of Bosco and the
Servicer, enforceable against each of Bosco and the Servicer in accordance with
the terms thereof, except as enforcement may be limited by equitable principles
(regardless of whether enforcement is sought in equity or at law) or by
bankruptcy, insolvency, reorganization, moratorium, or similar laws relating to
or limiting creditors’ rights generally.

(c) The representations and warranties contained in
Section 6 of the Amended Loan Servicing Agreement are correct after giving
effect to this Second Amendment on and as of the Second Amendment Effective Date
as though made on and as of the Second Amendment Effective Date (except to the
extent such representations and warranties expressly relate to an earlier
date.

(d) As of the date of this Second Amendment, it does not have,
and hereby waives, remises and releases any claims or causes of action of any
kind against the Administrative Agent, any Lender or any of their officers,
directors, employees, agents, attorneys, or representatives, or against any of
their respective predecessors, successors, or assigns relating in any way to any
event, circumstance, action, or omission relative to any of the Loan Documents
or any transaction contemplated thereby, from the beginning of time through the
date of this Second Amendment.



2










 




5. Reference to and Effect on Loan Documents. 

(a) Upon the effectiveness of this Second Amendment pursuant to
Section 3 hereof, on and after the Second Amendment Effective Date, each
reference to the Loan Servicing Agreement or the other Loan Documents shall mean
and be a reference to the Loan Servicing Agreement and the other Loan Documents,
respectively, as amended hereby.

(b) The execution, delivery and effectiveness of this Second
Amendment shall not, except as expressly provided herein, operate as a waiver of
any right, power or remedy of the Administrative Agent or the Lenders nor
constitute a waiver of any provision of any of the Loan Documents, or any other
documents, instruments and agreements executed and/or delivered in connection
therewith.

6. Miscellaneous. 

(a)
Continued Effectiveness of the Loan Servicing Agreement. Except as
otherwise expressly provided herein, the Loan Servicing Agreement, as amended
hereby, and the other Loan Documents are, and shall continue to be, in full
force and effect and are hereby ratified and confirmed in all respects, except
that on and after the Second Amendment Effective Date all references in the
other Loan Documents to the “Loan Servicing Agreement”, “thereto”, “thereof”,
“thereunder” or words of like import referring to the Loan Servicing Agreement
shall mean the Amended Loan Servicing Agreement.

(b)
Counterparts. This Second Amendment may be executed in any number of
counterparts and by different parties hereto in separate counterparts, each of
which shall be deemed to be an original, but all of which taken together shall
constitute one and the same agreement. Delivery of an executed counterpart of
this Second Amendment by facsimile or electronic mail shall be equally as
effective as delivery of an original executed counterpart of this Second
Amendment.

(c)
Headings. Section headings herein are included for convenience of
reference only and shall not constitute a part of this Second Amendment for any
other purpose.

(d)
Costs and Expenses. Bosco agrees to pay on demand all reasonable fees,
costs and expenses (including reasonable legal fees and expenses) of the
Administrative Agent, Servicer and the Lenders in connection with the
preparation, execution and delivery of this Second Amendment.

(e)
Amendment as Loan Document. Bosco and the Servicer hereby acknowledge and
agree that this Second Amendment constitutes a “Loan Document” under the Loan
Agreement. Accordingly, it shall be an Event of Default under the Loan Agreement
if any representation or warranty made by Bosco or the Servicer under or in
connection with this Second Amendment shall have been untrue, false or
misleading in any material respect when made.



3










 




(f)
Governing Law. This Second Amendment shall be governed by the laws of the
State of New York.

(g)
Waiver of Jury Trial. THE PARTIES HERETO HEREBY IRREVOCABLY WAIVE THEIR
RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR
ARISING OUT OF THIS SECOND AMENDMENT OR ANY OF THE TRANSACTIONS CONTEMPLATED
HEREIN, INCLUDING CONTRACT CLAIMS, TORT CLAIMS, BREACH OF DUTY CLAIMS, AND ALL
OTHER COMMON LAW OR STATUTORY CLAIMS.

[Remainder of this
Page Intentionally Left Blank.] 



4










 




IN
WITNESS WHEREOF, the parties hereto have caused this Second Amendment to be
executed and delivered as of the date first above written. 

	 	 	 	 	 
	 	FRANKLIN CREDIT MANAGEMENT
    CORPORATION
 	 
	 	By:  	/s/
      Kevin Gildea  	 
	 	 	Name:  	Kevin Gildea 	 
	 	 	Title:  	Chief Legal Officer 	 
	 


Signature Page to
Second
Amendment
to Loan
Servicing
Agreement 













 




	 	 	 	 	 
	 	BOSCO CREDIT LLC
 	 
	 	By:  	/s/
      Thomas Axon  	 
	 	 	Name:  	Thomas Axon 	 
	 	 	Title:  	Managing Member 	 
	 


Signature Page to
Second
Amendment
to Loan
Servicing
Agreement 













 





	 	 	 	 	 
	
      STATE OF NEW
      JERSEY
	 	)	 	 
	
       
	 	)	 	ss:
	
      COUNTY OF
      HUDSON
	 	)	 	 



On
the 28th day of
October, 2009 before me, a Notary Public in and for said State,
personally appeared Kevin Gildea, known to me to be Chief Legal
Officer of Franklin Credit Management Corporation the corporation
that executed the within instrument and also known to me to be the person who
executed it on behalf of said corporation, and acknowledged to me that such
corporation executed the within instrument. 

IN
WITNESS WHEREOF, I have hereunto set my hand affixed my office seal the day and
year in this certificate first above written. 

	 	 	 	 	 
	 	 	 
	 	/s/
      Donna M. Bonfiglio  	 
	 	Notary Public
 	 
	 	My Commission expires February 25,
      2011	 
	 


Signature Page to
Second
Amendment
to Loan
Servicing
Agreement 













 





	 	 	 	 	 
	
      STATE OF NEW
      JERSEY
	 	)	 	 
	
       
	 	)	 	ss:
	
      COUNTY OF
      HUDSON
	 	)	 	 



On
the 28th day of
October, 2009 before me, a Notary Public in and for said State,
personally appeared Thomas Axon, known to me to be Managing Member
of Bosco Credit LLC the corporation that executed the within instrument
and also known to me to be the person who executed it on behalf of said
corporation, and acknowledged to me that such corporation executed the within
instrument. 

IN
WITNESS WHEREOF, I have hereunto set my hand affixed my office seal the day and
year in this certificate first above written. 

	 	 	 	 	 
	 	 	 
	 	/s/
      Donna M. Bonfiglio  	 
	 	Notary Public
 	 
	 	My Commission expires February 25,
      2011	 
	 


Signature Page to
Second
Amendment
to Loan
Servicing
Agreement 













 




EXHIBIT D 

SERVICING FEE
SCHEDULE 

AMOUNT OF
SERVICING FEE. 

In return for services
rendered by Franklin Credit for the Owner, Franklin Credit will be compensated
with a monthly servicing fee for each month equal to the sum of (x) the
greater of $50,000 or the amounts determined pursuant to paragraphs I and II
below and (y) any amounts arising under paragraph III below. 

Servicing: 


	 	I.	 	For Mortgage Loans less than 180 days contractually past
      due, Servicing Fees:




	 	a)	 	Franklin Credit will be paid a monthly servicing fee at a Servicing
      Fee Rate equal to (x) the highest daily aggregate outstanding
      principal balance of such Mortgage Loans serviced by the Servicer for the
      previous month), times (y) ***, divided by (z) twelve. Each
      month the Servicer will retain or receive an amount equal to such
      servicing fee.
	 
	 	b)	 	Franklin Credit will be paid ***, of the amount of each
      principal payment indefeasibly collected, in each instance of the Mortgage
      Loans serviced by Servicer for the Owner pursuant to the Loan Servicing
      Agreement.




	 	II.	 	Other Fees




	 	A.	 	For Mortgage Loans less than 180 days contractually past due,
      Ancillary Fees paid by borrowers to be retained by Franklin Credit (income
      derived from Mortgage Loans):




	 	a.	 	Subordination fees
	 
	 	b.	 	Insufficient fund fees
	 
	 	c.	 	Late Payment Fees
	 
	 	d.	 	Prepayment Penalty Fees
	 
	 	e.	 	Release Fees
	 
	 	f.	 	Satisfaction fees
	 
	 	g.	 	All other incidental fees and charges received by Franklin
      Credit




	 	B.	 	For all Mortgage Loans, Loan Level
Charges:




	 	a)	 	Loan Set Up Fee: $*** per Mortgage Loan
	 
	 	b)	 	Deboarding Fee: $*** per Mortgage Loan (exclusive of out of
      pocket transfer related expenses)




	 	C.	 	For all Mortgage Loans 180 or more days contractually past due,
      Resolution Fees:




					
	 
	Recovery Collection	 	 	 	 
	(judgments and unsecured loans) 	 	*** of recovered amount per loan 	 	 




	 	III.	 	For all Mortgage Loans, Servicing Advances and Door Knock
      fees:





i










 








A. Servicing
Advances: Third party charges (e.g., force place insurance, credit reports,
title searches, tax searches, appraisal/ bpo, legal fees, reo maintenance,
taxes, insurance etc.) + Advances reimbursed to Franklin Credit. 

B. Face to Face
“Door Knock” field contact services: Upon request, at a fee to be negotiated
by the parties in good faith, and subject to the terms and conditions of a
separate written agreement mutually acceptable to the parties. 

With respect to
subparagraphs A and B, above, the Owner and Servicer agree and acknowledge that
Servicer will not or be required to perform any Face to Face “Door Knock” field
contact services or make any Servicing Advances that individually or in the
aggregate would result in a cost or expense to the Owner of more than $10,000
per month, without the prior written consent and approval of the Lenders.


DEFERRAL OF A
PORTION OF SERVICING FEE. 

To the extent the
amounts included in the Servicing Fee by virtue of paragraphs I and II above for
any month exceeds the greater of (x) $50,000 or (y) 10% of the total cash
collected on the Mortgage Loans for such month (the Monthly Cap”), payment of
the excess amount shall be deferred (without accruing interest during the period
of deferral). The cumulative amounts deferred, if any, shall be paid
(i) with the payment of the Servicing Fees for any month in which the
applicable Monthly Cap exceeds the Servicing Fees otherwise payable, up to the
amount of such excess, and (ii) to the extent not previously paid, on the date
on which any of the Notes under the Loan Agreement, is repaid, refinanced,
released, accelerated, or the amounts owing thereunder increased (other than by
accrual or capitalization of interest), provided, however, that if the deferred
Servicing Fees become payable by reason of acceleration of the Notes, the
Lenders’ right to payment under such Notes shall be prior in right of payment to
Servicer’s rights to such deferred Servicing Fees. Any Servicing Fees deferred
prior to the date of this Second Amendment shall be subject to payment in
accordance with the terms of this paragraph. 



ii