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


 





















 


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


 


2





















 


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]


 





















 


	
  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]