**Exhibit 10.44**

 

**THIRDAMENDMENT TO LOAN AGREEMENT**

 

THISTHIRD AMENDMENT TO LOAN AGREEMENT (this “Third Amendment” or this “Amendment”)is entered into as of February 18, 2009 (the “Execution Date”), tobe effective as of February 1, 2009, by and between AMERICAN BUSINESSLENDING, INC., a Texas corporation (“Borrower”), and WELLS FARGOFOOTHILL, LLC, a Delaware limited liability company (“Lender”), withreference to the following facts, which shall be construed as part of thisThird Amendment:

 

**RECITALS**

 

A.            Borrower and Lender have enteredinto that certain Loan Agreement dated as of December 15, 2006, as amendedby that certain First Amendment to Loan Agreement dated as of February 27,2007, and that certain Second Amendment to Loan Agreement dated as of July 30,2007, to be effective as of June 30, 2007 (as amended or modified fromtime to time, the “Loan Agreement”), pursuant to which Lender isproviding financial accommodations to or for the benefit of Borrower upon theterms and conditions contained therein. Unless otherwise defined herein, capitalized terms or matters ofconstruction defined or established in the Loan Agreement shall be appliedherein as defined or established therein.

 

B.            Borrower has requested that Lenderagree to certain amendments to the Loan Agreement, and Lender is willing to doso to the extent provided in, and subject to the terms and conditions of, thisThird Amendment.

 

**AGREEMENT**

 

NOW,THEREFORE, in consideration of the continued performance by Borrower of itspromises and obligations under the Loan Agreement and the other Loan Documents,and for other good and valuable consideration, the receipt and sufficiency ofwhich are hereby acknowledged, Borrower and Lender hereby agree as follows:

 

# 1.             Ratificationand Incorporation of Loan Agreement and Other Loan Documents.  Except as expressly modified under this ThirdAmendment, (a) Borrower hereby acknowledges, confirms, and ratifies all ofthe terms and conditions set forth in, and all of its obligations under, theLoan Agreement and the other Loan Documents, and (b) all of terms andconditions set forth in the Loan Agreement and the other Loan Documents areincorporated herein by this reference as if set forth in full herein.

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# 2.             Amendmentsto the Loan Agreement.  The LoanAgreement is hereby amended as follows:

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## 2.1           Addition of New Defined Terms.  **Section 1.1**of the Loan Agreement is amended by adding thereto in appropriate alphabeticalorder the following new defined terms:

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### a.            “Base Rate Margin” means twoand five-eighths percent (2.625%) per annum.

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### b.            “Borrower Originated Cash FlowLoan or Partially Secured Loan” shall mean a Borrower Originated Loan thatwas funded under Borrower’s 

 

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### underwriting standards, butthat does not qualify as a Borrower Originated Mixed Collateral Loan or aBorrower Originated Real Estate Loan.

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### c.            “Borrower Originated MixedCollateral Loan” shall mean a Borrower Originated Loan that was fundedunder Borrower’s underwriting standards based upon being secured by equipmentor other tangible personal property having an appraised value, or a combinationof such equipment or other tangible personal property and commercial realestate.

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### d.            “Borrower Originated Real EstateLoan” shall mean a Borrower Originated Loan that was funded under Borrower’sunderwriting standards based upon being secured by commercial real estate.

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### e.            “Third Amendment” shall meanthe Third Amendment to Loan Agreement dated as of February 18, 2009, andeffective as of February 1, 2009, between Borrower and Lender.

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## 2.2            Deletion of Certain ExistingDefined Terms and Exhibit Relating to LIBOR Option.  (i) **Section 1.1**of the Loan Agreement is amended by deleting the existing definitions of theterms “Funding Losses,” “LIBOR Deadline,” “LIBOR Notice,” and “LIBOR Option,”,and (ii) Exhibit F to the Loan Agreement is deleted.

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## 2.3            Amendment to Definition of BaseLIBOR Rate.  **Section 1.1** of the Loan Agreement isamended by deleting the existing definition of the term “Base LIBOR Rate” andreplacing it with the following amended and restated version thereof:

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“Base LIBOR Rate” means the rate per annum,determined by Lender in accordance with its customary procedures, and utilizingsuch electronic or other quotation sources as it considers appropriate (roundedupwards, if necessary, to the next 1/100%), to be the rate at which Dollardeposits (for delivery on the first day of the requested Interest Period) inthe amount of $1,000,000 are offered to major banks in the London interbankmarket, on or about 1:00 p.m. (Dallas time) two (2) Business Daysprior to the commencement of such Interest Period, for a term of three (3) months,which determination shall be conclusive in the absence of manifest error.

 

## 2.4            Amendment to Definition of BaseRate.  **Section 1.1** of the Loan Agreement is amended by deletingthe existing definition of the term “Base Rate” and replacing it with thefollowing amended and restated version thereof:

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“Base Rate” means the higher of (i) theper annum rate which Wells Fargo publicly announces from time to time to be itsprime lending rate, as in effect from time to time, or (ii) the Base LIBORRate in effect from time to time.  WellsFargo’s prime lending rate is a reference rate and does not necessarilyrepresent the lowest or best rate charged to customers.  Wells Fargo may make commercial loans orother loans at rates of interest at, above or below Wells Fargo’s prime lendingrate.  Each change in Wells Fargo’s primelending rate shall be effective from and including the date such change ispublicly announced as being effective.

 

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## 2.5            Amendment to Definition ofBorrower Originated Loans Borrowing Base. **Section 1.1** of theLoan Agreement is amended by deleting the existing definition of the term “BorrowerOriginated Loans Borrowing Base” and replacing it with the following amendedand restated version thereof:

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### “BorrowerOriginated Loans Borrowing Base” shall mean the amount by which (A) thesum of (1) up to one hundred percent (100%) of the Net Eligible SBAGuaranteed Notes Receivable that are Borrower Originated Loans, plus (2) upto eighty percent (80%) of the Net Eligible Non-Guaranteed Notes Receivablethat are Borrower Originated Real Estate Loans, plus (3) up toseventy percent (70%) of the Net Eligible Non-Guaranteed Notes Receivable thatare Borrower Originated Mixed Collateral Loans, *exceeds*(B) the sum of (1) the Bank Products Reserves with respect toBorrower Originated Loans, plus (2) the aggregate amount, if any,of Note Sale Reserves then established and outstanding with respect to BorrowerOriginated Loans, plus (3) the aggregate amount of any otherreserves established by Lender pursuant to **Section 2.1(c) **withrespect to Borrower Originated Loans.

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## 2.6            Amendment to Definition ofMaximum Credit Line**.  Section 1.1** of the LoanAgreement is amended by deleting the existing version of the defined term “MaximumCredit Line” contained therein and replacing it with the following amended andrestated version thereof:

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“Maximum Credit Line” shall mean $25,000,000,or such higher amount as Lender may agree to in its sole discretion.

 

## 2.7            Amendment to Definition ofTermination Date**.  Section 1.1** of the LoanAgreement is amended by deleting the existing version of the defined term “TerminationDate” contained therein and replacing it with the following amended andrestated version thereof:

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“Termination Date” shall mean the earliestof: (a) January 31, 2010 (unless a later date is agreed to in writingby Borrower and Lender); (b) the date that Borrower elects to terminatethis Agreement and repays the Obligations in full in accordance with the termsof **Section 2.6**; and (c) thedate Lender elects to terminate Borrower’s right to receive Revolving Loans inaccordance with **Section 7.2**.

 

## 2.8            Amendment to Interest Rate.  **Section 2.3(b) **ofthe Loan Agreement is amended by deleting the existing version thereof andreplacing it with the following amended and restated version thereof:

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(b)          Interest shall accrueon the Revolving Loans at a rate equal to (i) in the case of a LIBOR RateLoan, at a per annum rate equal to the greater of (A) the LIBOR Rate forthe applicable Interest Period plus the LIBOR Rate Margin, or (B) threeand five-eighths percent (3.625%) per annum; (ii) in the case of a Base RateLoan, at a floating per annum rate equal to the greater of (A) the BaseRate plus the Base Rate Margin, or (B) seven and one-half percent(7.50%) per annum; and (iii) otherwise, at a floating per annum rate equalto the greater of (A) the Base 

 

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Rateplus the Base Rate Margin, or (B) seven and one-half percent(7.50%) per annum.

 

## 2.9            Amendment to Unused Credit LineFee.  **Section 2.5(b) **ofthe Loan Agreement is amended by adding the following additional text at theend of the existing text thereof:

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Withoutlimiting the generality of the foregoing, upon the effectiveness of the ThirdAmendment the Maximum Credit Line was reduced to $25,000,000 as of February 1,2009, and the fee payable pursuant to this **Section 2.5(b) **forperiods starting on or after February 1, 2009 shall be calculated using$25,000,000 as the amount of the Maximum Credit Line unless and until theMaximum Credit Line is further modified.

 

## 2.10          Amendment to Eliminate ElectiveNature of LIBOR Rate Pricing.  **Section 2.20** of the Loan Agreement is amended bychanging the title of that section from “LIBOR Option” to “LIBORPricing” and deleting the existing versions of **Sections 2.20(a),(b) **and **(c) **andreplacing them with the following amended and restated versions thereof:

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(a)           **Interest and Interest Payment Dates. **Except as****otherwiseprovided in **Section 2.20(d)(ii)**, intereston all of the Revolving Loans shall be charged at a rate of interest based uponthe LIBOR Rate.  Interest on LIBOR RateLoans shall be payable on the earliest of (i) the first calendar day afterthe last day of the Interest Period applicable thereto, (ii) theoccurrence of an Event of Default in consequence of which Lender has elected toaccelerate the maturity of all or any portion of the Obligations, or (iii) terminationof this Agreement pursuant to the terms hereof.

 

(b)          [Intentionally Omitted].

 

(c)           [Intentionally Omitted].

 

## 2.11          Amendment to Special ProvisionsApplicable to LIBOR Rate.  **Section 2.20(d)(ii) **of the Loan Agreement isamended by deleting the existing version thereof and replacing it with thefollowing amended and restated version thereof:

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(ii)           Inthe event that any change in market conditions or any law, regulation, treaty,or directive, or any change therein or in the interpretation of applicationthereof, shall at any time after the date hereof, in the reasonable opinion ofLender, make it unlawful or impractical for Lender to fund or maintain LIBORRate Loans or to continue such funding or maintaining, or to determine orcharge interest rates based upon the LIBOR Rate, Lender shall give notice ofsuch changed circumstances to Borrower and (A) in the case of any LIBORRate Loans that are outstanding, the date specified in Lender’s notice shall bedeemed to be the last day of the Interest Period of such LIBOR Rate Loans, andinterest upon the LIBOR Rate Loans thereafter shall accrue interest at the ratethen applicable to Base Rate Loans, and (B) all Revolving Loans shallfunded and maintained as Base Rate Loans until Lender determines that it wouldno longer be unlawful or 

 

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impractical to fund ormaintain LIBOR Rate Loans or to determine or charge interest rates based uponthe LIBOR Rate.

 

## 2.12          Amendment to Minimum Tangible NetWorth Covenant.  Section 5.11(a) ofthe Loan Agreement is amended by deleting the existing version thereof andreplacing it with the following amended and restated version thereof:

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(a)           MinimumTangible Net Worth. As of the end of each fiscal quarter shown below, maintain, on a consolidated basiswith Borrower’s Subsidiaries, and after taking into account any dividends paidor accrued, Tangible Net Worth of not less than $5,500,000 plus 100% ofthe sum of the positive amounts, if any (but not any negative amounts), ofBorrower’s net income for each of the Fiscal Quarters ending on or after March 31,2009 through the date of measurement the corresponding amount shown for suchfiscal quarter.

 

## 2.13          Amendment to Criteria for NetEligible Non-Guaranteed Notes Receivable**.  Schedule 1.1(a) **of theLoan Agreement is amended by deleting the existing version of **paragraph J** thereof and replacing it with the followingamended and restated version thereof:

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J.             If theNon-Guaranteed Note Receivable is a Borrower Originated Loan, then suchNon-Guaranteed Note Receivable (i) is not a Borrower Originated Cash FlowLoan or Partially Secured Loan and (ii) does not cause the portion of NetEligible Non-Guaranteed Notes Receivable that are Borrower Originated MixedCollateral Loans to exceed twenty percent (20%) of the total Net EligibleNon-Guaranteed Notes Receivable that are Borrower Originated Loans; provided,that in any case covered by (ii) above, such Non-Guaranteed NoteReceivable will be ineligible only to the extent of such excess;

 

# 3.             ConditionsPrecedent.  Notwithstanding any otherprovision of this Third Amendment, this Third Amendment shall be of no force oreffect, and Lender shall not have any obligations hereunder, until thefollowing conditions have been satisfied:

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## 3.1            Third Amendment and otherDocuments in Connection therewith. Lender shall have received the following, each in form and substancesatisfactory to Lender:

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### a.            this Third Amendment, duly executedby Borrower and Lender;

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### b.            an Amended and Restated GeneralContinuing Limited Guaranty  executed byFirstCity Financial in favor of Lender (the “Amended FCF Guaranty”),amending and restating the General Continuing Limited Guaranty dated asof February 27, 2007executed by FirstCity Financial in favor of Lender with respect to certain ofthe Obligations (the “Original FCF Guaranty”), which Amended FCFGuaranty amends the “Guaranteed Obligations” and “Indebtedness” thereunder toinclude all Obligations of Borrower to Lender under the Loan Agreement andother Loan Documents, subject only to the “Guaranty Limitation” under theOriginal FCF Guaranty;

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### c.            Certificate of the Secretary or anAssistant Secretary of FirstCity Financial, with respect to the authority ofFirstCity Financial to execute, deliver 

 

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### and perform the Amended FCFGuaranty, and the authority and incumbency of the officer executing the AmendedFCF Guaranty on behalf of FirstCity Financial; and

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###  d.           writtenconsent by SBA to this Third Amendment and the transactions contemplatedhereby.

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## 3.2            No Default or Event of Default.  No Default or Event of Default shall haveoccurred and be continuing.

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# 4.             Representationsand Warranties re Loan Agreement. Borrower hereby represents and warrants that the representations andwarranties contained in the Loan Agreement were true and correct in allmaterial respects when made and, except to the extent that (a) aparticular representation or warranty by its terms expressly applies only to anearlier date, or (b) Borrower has previously advised Lender in writing ascontemplated under the Loan Agreement, are true and correct in all materialrespects as of the date hereof.  Borrowerhereby further represents and warrants that no event has occurred and iscontinuing, or would result from the transactions contemplated under this ThirdAmendment, that constitutes or would constitute a Default or an Event ofDefault.

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# 5.             Borrower’sWaiver of Claims Arising Prior to Execution Date of Amendment.  In consideration of Lender entering into thisThird Amendment, Borrower, on behalf of itself, its Subsidiaries and its otherAffiliates, hereby waives, releases, remises and forever discharges Lender andeach other Indemnified Person from any and all claims, suits, actions,investigations, proceedings or demands, whether based in contract, tort,implied or express warranty, strict liability, criminal or civil statute orcommon law of any kind or character, known or unknown (collectively, the “Claims”),which Borrower ever had, now has or might hereafter have against Lender or anyother Indemnified Person based on any acts or omissions of Lender or any otherIndemnified Person on or prior to the Execution Date.  Borrower hereby waives and relinquishes foritself, its Subsidiaries and its other Affiliates all of the rights andbenefits each such Person has, or may have, with respect to the Claims releasedunder Section 1542 of the California Civil Code or any other similarstatute.  Section 1542 of theCalifornia Civil Code states as follows:

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A GENERAL RELEASE DOESNOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST INHIS FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM MUST HAVEMATERIALLY AFFECTED HIS SETTLEMENT WITH THE DEBTOR.

 

Borrowerhas been advised by counsel with respect to the release contained in this **Section 5**.

 

# 6.             Miscellaneous.

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## 6.1          Headings.  The various headings of this Third Amendmentare inserted for convenience of reference only and shall not affect the meaningor interpretation of this Third Amendment or any provisions hereof.

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## 6.2          Counterparts.  This Third Amendment may be executed by theparties hereto in several counterparts, each of which shall be deemed to be anoriginal and all of 

 

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## which together shall bedeemed to be one and the same instrument. Delivery of an executed counterpart of a signature page to thisThird Amendment by facsimile transmission shall be effective as delivery of amanually executed counterpart thereof.

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## 6.3            Interpretation.  No provision of this Third Amendment shall beconstrued against or interpreted to the disadvantage of any party hereto by anycourt or other governmental or judicial authority by reason of such party’shaving or being deemed to have structured, drafted or dictated such provision.

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## 6.4            Complete Agreement.  This Third Amendment constitutes the completeagreement between the parties with respect to the subject matter hereof, andsupersedes any prior written or oral agreements, writings, communications orunderstandings of the parties with respect thereto.

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## 6.5            Governing Law.  This Third Amendment shall be governed by,and construed and enforced in accordance with, the laws of the State of NewYork applicable to contracts made and performed in such state, without regardto the principles thereof regarding conflict of laws.

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## 6.6            Effect.  Upon the effectiveness of this ThirdAmendment, each reference in the Loan Agreement to “this Agreement,” “hereunder,”“hereof” or words of like import shall mean and be a reference to the LoanAgreement as amended hereby and each reference in the other Loan Documents tothe Loan Agreement, “thereunder,” “thereof,” or words of like import shall meanand be a reference to the Loan Agreement as amended hereby.

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## 6.7            Conflict of Terms.  In the event of any inconsistency between theprovisions of this Third Amendment and any provision of the Loan Agreement, theterms and provisions of this Third Amendment shall govern and control.

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## 6.8            No Novation or Waiver.  Except as specifically set forth in thisThird Amendment, the execution, delivery and effectiveness of this ThirdAmendment shall not (a) limit, impair, constitute a waiver by, orotherwise affect any right, power or remedy of, Lender under the Loan Agreementor any other Loan Document, (b) constitute a waiver of any provision inthe Loan Agreement or in any of the other Loan Documents or of any Default orEvent of Default that may have occurred and be continuing, or (c) alter,modify, amend or in any way affect any of the terms, conditions, obligations,covenants or agreements contained in the Loan Agreement or in any of the otherLoan Documents, all of which are ratified and affirmed in all respects andshall continue in full force and effect.

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INWITNESS WHEREOF, the parties hereto have executed this Third Amendment to LoanAgreement as of the day and year first above written.

 
| ** ** | **AMERICAN BUSINESS LENDING, INC.**, a Texas corporation |
|------------|----------------------------------------------------------|
| ** ** | ** **                                               |
|       |                                                     |
|       | By:                                                      |   |
|       |                                                     | Charles P. Bell, Jr. |
|       |                                                     | Chief Executive Officer |
|       |                                                     |   |
|       |                                                     |   |
|       | **WELLS FARGO FOOTHILL, LLC,**                           |
|       | a  Delaware limited liability company                    |
|       |                                                     |   |
|       |                                                     |   |
|       | By:                                                      |   |
|       |                                                     | Laurel Varney |
|       |                                                     | Vice President |

 

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