Document:

Exhibit 10.5

 

AMENDMENT NO. 2
 TO PRICING SIDE LETTER

 

Amendment No. 2, dated as of February 21, 2013 (this “Amendment”), among CREDIT SUISSE FIRST BOSTON MORTGAGE CAPITAL LLC (the “Buyer”), EXCEL MORTGAGE SERVICING, INC. (the “Seller”), INTEGRATED REAL ESTATE SERVICE CORP. and IMPAC MORTGAGE HOLDINGS, INC. (the “Guarantors”).

 

RECITALS

 

The Buyer, the Seller and the Guarantors are parties to that certain Master Repurchase Agreement, dated as of September 21, 2012 and the related Pricing Side Letter, dated as of September 21, 2012, as amended by Amendment No. 1, dated as of November 19, 2012 (the “Existing Pricing Side Letter”; and as further amended by this Amendment, the “Pricing Side Letter”).  The Guarantors are parties to that certain Guaranty (the “Guaranty”), dated as of September 21, 2012, as the same may be further amended from time to time.  Capitalized terms used but not otherwise defined herein shall have the meanings given to them in the Existing Pricing Side Letter.

 

The Buyer, the Seller and the Guarantors have agreed, subject to the terms and conditions of this Amendment, that the Existing Pricing Side Letter be amended to reflect certain agreed upon revisions to the terms of the Existing Pricing Side Letter.  As a condition precedent to amending the Existing Pricing Side Letter, the Buyer has required the Guarantors to ratify and affirm the Guaranty on the date hereof.

 

Accordingly, the Buyer, the Seller and the Guarantors hereby agree, in consideration of the mutual promises and mutual obligations set forth herein, that the Existing Pricing Side Letter is hereby amended as follows:

 

1.1                               Definitions.  Section 1 of the Existing Pricing Side Letter is hereby amended by:

 

(a)                                 Adding the following definitions in their proper alphabetical order:

 

“Conforming Tier 1 High LTV Loan” means a Conforming Mortgage Loan with an LTV of 105% or higher but not to exceed 125%.

 

“Conforming Tier 2 High LTV Loan” means a Conforming Mortgage Loan with an LTV of 125% or higher but not to exceed 150%.

 

“Encumbered Mortgage Servicing Rights Equity” means that portion of the MSR Valuation of the Encumbered Mortgage Servicing Rights that exceeds the Indebtedness encumbering such mortgage servicing rights.

 

(b)                                 deleting the definitions of “Adjusted Tangible Net Worth,” “Asset Value,” “Conforming High LTV Loan” and “Maximum Aggregate Purchase Price” in its entirety and replacing them with the following:

 

 

“Adjusted Tangible Net Worth” means, for any Person, Net Worth of such Person plus Subordinated Debt (provided that Subordinated Debt shall not be taken into account to the extent that it would cause Adjusted Tangible Net Worth to be comprised of greater than 25% Subordinated Debt), minus (a) Restricted Cash (other than any portion of Restricted Cash that has a corresponding offsetting current liability); (b) 25% of investment securities; (c) 50% of all mortgage loans held for investment; (d) 50% of real estate owned property; (e) 25% of the MSR Valuation of any Unencumbered Mortgage Servicing Rights; (f) the difference, if any, of (x) the value of the mortgage servicing rights owned by Seller as set forth in the Seller’s most recent balance sheet as determined by the Seller as of such date in accordance with GAAP and (y) the MSR Valuation, (g) 100% of the Encumbered Mortgage Servicing Rights Equity, (h) 100% of corporate or servicing advances and (i) all intangible assets, including goodwill, patents, tradenames, trademarks, copyrights, franchises, any organizational expenses, deferred taxes and expenses, prepaid expenses, prepaid assets, receivables from shareholders, Affiliates or employees, and any other asset as shown as an intangible asset on the balance sheet of such Person on a consolidated basis as determined at a particular date in accordance with GAAP (other than any portion of such assets that has a corresponding offsetting current liability).

 

“Asset Value” means with respect to any Purchased Mortgage Loans as of any date of determination, an amount equal to the product of (a) the Purchase Price Percentage for the Purchased Mortgage Loan and (b) the lesser of (i) the Market Value of the Purchased Mortgage Loan or (ii) the unpaid principal balance of such Purchased Mortgage Loan. Without limiting the generality of the foregoing, Seller acknowledges that (a) in the event that a Purchased Mortgage Loan is not subject to a Take-out Commitment, Buyer may deem the Asset Value for such Mortgage Loan to be no greater than par and (b) the Asset Value of a Purchased Mortgage Loan may be reduced to zero by Buyer if any of the following events occur:

 

(i)             a breach of a representation, warranty or covenant made by Seller in the Agreement with respect to such Purchased Mortgage Loan has occurred and is continuing;

 

(ii)          such Purchased Mortgage Loan is a Non-Performing Mortgage Loan;

 

(iii)       such Purchased Mortgage Loan has been released from the possession of the Custodian under the Custodial Agreement (other than to a Take-out Investor pursuant to a Bailee Letter) for a period in excess of ten (10) calendar days;

 

(iv)      such Purchased Mortgage Loan has been released from the possession of the Custodian under the Custodial Agreement to a Take-out Investor pursuant to a Bailee Letter for a period in excess of thirty (30) calendar days;

 

(v)         such Purchased Mortgage Loan has been subject to a Transaction hereunder for a period of greater than the respective Aging Limit;

 

 

(vi)      such Purchased Mortgage Loan is an FHA 203(k) Loan for which the Buyer is requested to enter into a Transaction for a draw on such FHA 203(k) Loan other than an initial draw;

 

(vii)   such Purchased Mortgage Loan is a Wet-Ink Mortgage Loan for which the Mortgage File has not been delivered to the Custodian on or prior to the Wet-Ink Delivery Date;

 

(viii)       when the Purchase Price for such Purchased Mortgage Loan is added to other Purchased Mortgage Loans, the aggregate Purchase Price of all Purchased Mortgage Loans of any type of Mortgage Loan set forth below exceeds the applicable percentage listed opposite such type of Mortgage Loan as set forth below:

 

	
Type of Mortgage
   Loan
    	
 
    	
Percentage of the Maximum
   Aggregate Purchase Price (unless
   otherwise noted)
    	
 
    
	
Conforming Mortgage Loans
    	
 
    	
100%
    	
 
    
	
FHA Loans and VA Loans
    	
 
    	
100%
    	
 
    
	
FHA 203(k) Loans
    	
 
    	
10%
    	
 
    
	
Aged Loans
    	
 
    	
10%
    	
 
    
	
Wet-Ink Mortgage Loans
    	
 
    	
30%
    	
 
    
	
Conforming Tier 1 High LTV Loans
    	
 
    	
25% less the aggregate Purchase Price of any Conforming Tier 2 High   LTV Loans
    	
 
    
	
Conforming Tier 2 High LTV Loans
    	
 
    	
2.5%
    	
 
    
	
VA High LTV Loans
    	
 
    	
2.5%
    	
 
    

 

“Conforming High LTV Loan” means collectively the Conforming Tier 1 High LTV Loan and Conforming Tier 2 High LTV Loan.

 

“Maximum Aggregate Purchase Price” means ONE HUNDRED MILLION DOLLARS ($100,000,000).

 

SECTION 2.                            Financial Covenants.  Section 2 of the Existing Pricing Side Letter is hereby amended by deleting Sections 2.1 and 2.3 in their entirety and replacing them with the following:

 

2.1                               Adjusted Tangible Net Worth. Seller shall maintain an Adjusted Tangible Net Worth of at least $20,000,000.

 

 

2.3                               Maintenance of Liquidity.  The Seller shall ensure that at all times, it has cash (other than Restricted Cash) and Cash Equivalents in an amount not less than $7,500,000.

 

SECTION 3.                            Officer’s Certificate.  Exhibit A of the Existing Pricing Side Letter is hereby amended by deleting it in its entirety and replacing it with the attached Schedule 1.

 

SECTION 4.                            Conditions Precedent.  This Amendment shall become effective as of the date hereof (the “Amendment Effective Date”), subject to the satisfaction of the following conditions precedent:

 

4.1                               Delivered Documents.  On the Amendment Effective Date, the Buyer shall have received the following documents, each of which shall be satisfactory to the Buyer in form and substance:

 

(a)                                 this Amendment, executed and delivered by the Guarantors and duly authorized officers of the Buyer and the Seller; and

 

(b)                                 such other documents as the Buyer or counsel to the Buyer may reasonably request.

 

SECTION 5.                            Representations and Warranties.  The Seller hereby represents and warrants to the Buyer that it is in compliance with all the terms and provisions set forth in the Master Repurchase Agreement on its part to be observed or performed, and that no Event of Default has occurred or is continuing, and hereby confirms and reaffirms the representations and warranties contained in Section 13 of the Master Repurchase Agreement.

 

SECTION 6.                            Limited Effect.  Except as expressly amended and modified by this Amendment, the Existing Pricing Side Letter shall continue to be, and shall remain, in full force and effect in accordance with its terms and the execution of this Amendment by the Buyer.

 

SECTION 7.                            Severability. Each provision and agreement herein shall be treated as separate and independent from any other provision or agreement herein and shall be enforceable notwithstanding the unenforceability of any such other provision or agreement.

 

SECTION 8.                            Counterparts.  This Amendment may be executed by each of the parties hereto on any number of separate counterparts, each of which shall be an original and all of which taken together shall constitute one and the same instrument.

 

SECTION 9.                            GOVERNING LAW.  THIS AMENDMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT REFERENCE TO THE CHOICE OF LAW PROVISIONS THEREOF.

 

SECTION 10.                     Reaffirmation of Guaranty.  The Guarantors hereby ratify and affirm all of the terms, covenants, conditions and obligations of the Guaranty and acknowledge and agree that the term “Obligations” as used in the Guaranty shall apply to all of the Obligations of Seller to Buyer under the Pricing Side Letter, as amended hereby.

 

 

IN WITNESS WHEREOF, the undersigned have caused this Pricing Side Letter to be duly executed as of the date first above written.

 

	
 
    	
Credit   Suisse First Boston Mortgage Capital LLC, as Buyer
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Adam Loskove
    
	
 
    	
Name:
    	
Adam   Loskove
    
	
 
    	
Title:
    	
Vice   President
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
Excel   Mortgage Servicing, Inc., as Seller
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   William Ashmore
    
	
 
    	
Name:
    	
William   Ashmore
    
	
 
    	
Title:
    	
President
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
Impac   Mortgage Holdings, Inc., as a Guarantor
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   William Ashmore
    
	
 
    	
Name:
    	
William   Ashmore
    
	
 
    	
Title:
    	
President
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
Integrated   Real Estate Service Corp., as a Guarantor
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   William Ashmore
    
	
 
    	
Name:
    	
William   Ashmore
    
	
 
    	
Title:
    	
President
    

 

 

SCHEDULE 1

 

EXHIBIT A

 

OFFICER’S COMPLIANCE CERTIFICATE

 

I,                                       , do hereby certify that I am the [duly elected, qualified and authorized] [CFO/TREASURER/FINANCIAL OFFICER] of Excel Mortgage Servicing, Inc. (“Seller”), I,                                       , do hereby certify that I am the [duly elected, qualified and authorized] [CFO/TREASURER/FINANCIAL OFFICER] of Integrated Real Estate Service Corp. (“IRES” and a “Guarantor”) and I,                                       , do hereby certify that I am the [duly elected, qualified and authorized] [CFO/TREASURER/FINANCIAL OFFICER] of Impac Mortgage Holdings, Inc (“Impac”, a “Guarantor” and together with IRES, the “Guarantors”). This Certificate is delivered to you in connection with Section 17 of the Master Repurchase Agreement dated as of September 21, 2012, among Seller, Guarantors and Credit Suisse First Boston Mortgage Capital LLC (as amended from time to time, the “Agreement”), as the same may have been amended from time to time.  I hereby certify that, as of the date of the financial statements attached hereto and as of the date hereof, Seller and each Guarantor are and have been in compliance with all the terms of the Agreement and, without limiting the generality of the foregoing, I certify that:

 

Adjusted Tangible Net Worth.  Seller has maintained an Adjusted Tangible Net Worth of at least $20,000,000.  A detailed summary of the calculation of Seller’s actual Adjusted Tangible Net Worth is provided in Schedule 1 hereto.

 

Indebtedness to Adjusted Tangible Net Worth Ratio.  Seller’s ratio of Indebtedness (on and off balance sheet) to Adjusted Tangible Net Worth has not exceeded 12:1 for the calendar month ending [DATE].  A calculation of Seller’s actual Indebtedness to Adjusted Tangible Net Worth is provided in Schedule 1 hereto.

 

Maintenance of Profitability.  Seller has not permitted, for any Test Period, Net Income for such Test Period, before income taxes for such Test Period and distributions made during such Test Period, to be less than $1.00.

 

Maintenance of Liquidity.  The Seller has ensured that, at all times, it has had cash (other than Restricted Cash) and Cash Equivalents in an amount not less than $7,500,000.

 

Additional Warehouse Line.  The Seller has maintained at least one additional warehouse or repurchase facility in a combined amount at least equal to the Maximum Aggregate Purchase Price.

 

Insurance.  Seller, or its Affiliates, have maintained, for Seller and its Subsidiaries, insurance coverage with respect to employee dishonesty, forgery or alteration, theft, disappearance and destruction, robbery and safe burglary,

 

 

property (other than money and securities) and computer fraud or an aggregate amount of at least $                          .  The actual amount of such coverage is $                          .

 

Financial Statements.  The financial statements attached hereto are accurate and complete, accurately reflect the financial condition of Seller, and do not omit any material fact as of the date(s) thereof.

 

Documentation.  Seller has performed the documentation procedures required by its operational guidelines with respect to endorsements and assignments, including the recordation of assignments, or has verified that such documentation procedures have been performed by a prior holder of such Mortgage Loan.

 

Compliance.  Seller has observed or performed in all material respects all of its covenants and other agreements, and satisfied every condition, contained in the Agreement and the other Program Agreements to be observed, performed and satisfied by it.  [If a covenant or other agreement or condition has not been complied with, Seller shall describe such lack of compliance and provide the date of any related waiver thereof.]

 

Regulatory Action.  Seller is not currently under investigation or, to best of Seller’s knowledge, no investigation by any federal, state or local government agency is threatened.  Seller has not been the subject of any government investigation which has resulted in the voluntary or involuntary suspension of a license, a cease and desist order, or such other action as could adversely impact Seller’s business.  [If so, Seller shall describe the situation in reasonable detail and describe the action that Seller has taken or proposes to take in connection therewith.]

 

No Default.  No Default or Event of Default has occurred or is continuing.  [If any Default or Event of Default has occurred and is continuing, Seller shall describe the same in reasonable detail and describe the action Seller has taken or proposes to take with respect thereto, and if such Default or Event of Default has been expressly waived by Buyer in writing, Seller shall describe the Default or Event of Default and provide the date of the related waiver.]

 

Distributions.  On and after the date of the Agreement, Seller nor Guarantors have paid any dividends greater than Net Income in any given calendar year other than with respect to quarterly payments to the holders of trust preferred obligations of Impac paid by Impac.

 

Indebtedness.  All Indebtedness (other than Indebtedness evidenced by the Repurchase Agreement) of Seller existing on the date hereof is listed on Schedule 2 hereto.

 

Originations.  Attached hereto as Schedule 3 is a true and correct summary of all Mortgage Loans originated by Seller for the calendar month ending [DATE] and for the year to date ending [DATE].

 

 

DE Compare Ratio.  Seller’s DE Compare Ratio has not (i) on and after the date Seller’s DE Compare Ratio was at least 100%, increased by more than 25% or (ii) exceeded 150%, for the calendar month ending [DATE].

 

Hedging.  Attached hereto as Schedule 4 is a true and correct summary of all Interest Rate Protection Agreements entered into or maintained by Seller during the calendar month ending on [DATE].

 

Repurchases and Early Payment Default Requests.  Attached hereto as Schedule 5 is a true and correct summary of the portfolio performance including representation breaches, missing document breaches, repurchases due to fraud, early payment default requests, and Mortgage Loans subject to other warehouse lines in excess of 60 days summarized on the basis of (a) pending repurchase demands (including weighted average duration of outstanding request), (b) satisfied repurchase demands and (c) total repurchase demands.

 

Quality Control.  Attached hereto as Schedule 6 is a true and correct copy of the internal quality control maintained by Seller.

 

Secondary Market Sales.  Attached hereto as Schedule 7 is a true and correct summary of all the mortgage loans sold by Seller during the calendar month ending [DATE].

 

Geographic Production Breakdown.  Attached hereto as Schedule 8 is a true and correct summary of all the geographic locations of the Mortgage Loans originated by Seller during the calendar month ending [DATE].

 

MSR Valuation. A detailed summary of the market value analysis for Seller’s MSR Valuation as determined (i) internally for each monthly fiscal period and (ii) by a Third Party Evaluator for each quarterly fiscal period, as applicable, is provided in Schedule 9 hereto.

 

Litigation Summary.  Attached hereto as Schedule 10 is a true and correct summary of all actions, notices, proceedings and investigations pending with respect to which Seller has received service of process or other form of notice or, to the best of Seller’s knowledge, threatened against it, before any court, administrative or governmental agency or other regulatory body or tribunal as of the calendar month ending [DATE].

 

 

IN WITNESS WHEREOF, I have set my hand this            day of                 ,                 .

 

	
 
    	
Excel   Mortgage Servicing, Inc., as Seller
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
Name:
    	
 
    
	
 
    	
Title:
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
Impac   Mortgage Holdings, Inc., as a Guarantor
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
Name:
    	
 
    
	
 
    	
Title:
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
Integrated   Real Estate Service Corp., as a Guarantor
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
Name:
    	
 
    
	
 
    	
Title:
    	
 
    

 

 

 

 

SCHEDULE 1 TO OFFICER’S COMPLIANCE CERTIFICATE

 

CALCULATIONS OF FINANCIAL COVENANTS
 As of the calendar month ended [DATE] or quarter ended [DATE]

 

	
I.
    	
Adjusted   Tangible Net Worth
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
1.
    	
Net   Worth (book)
    	
 
    	
$
    
	
 
    	
Plus:
    	
 
    	
 
    
	
2.
    	
Subordinated   Debt (maturity > CSFB line maturity)
    	
 
    	
$
    
	
 
    	
 
    	
 
    	
 
    
	
I.(a)
    	
Total   of items 1-2
    	
 
    	
$
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
Less:
    	
 
    	
 
    
	
3.
    	
Restricted   Cash
    	
 
    	
$
    
	
4.
    	
25%   of investment securities
    	
 
    	
$
    
	
5.
    	
50%   of all mortgage loans held for investment
    	
 
    	
$
    
	
6.
    	
50%   of real estate owned property
    	
 
    	
$
    
	
7.
    	
25%   of the MSR Valuation of any Unencumbered Mortgage Servicing Rights
    	
 
    	
$
    
	
8.
    	
100%   of the MSR Valuation of any Encumbered Mortgage Servicing Rights
    	
 
    	
$
    
	
9.
    	
100%   of the Encumbered Mortgage Servicing Rights Equity
    	
 
    	
$
    
	
10.
    	
100%   of corporate or servicing advances
    	
 
    	
$
    
	
11.
    	
Goodwill
    	
 
    	
$
    
	
12.
    	
Patents
    	
 
    	
$
    
	
13.
    	
Tradenames
    	
 
    	
$
    
	
14.
    	
Trademarks
    	
 
    	
$
    
	
15.
    	
Copyrights
    	
 
    	
$
    
	
16.
    	
Franchises
    	
 
    	
$
    
	
17.
    	
 
    	
 
    	
 
    
	
18.
    	
 
    	
 
    	
 
    
	
19.
    	
 
    	
 
    	
 
    
	
20.
    	
 
    	
 
    	
 
    
	
21.
    	
Organizational   expenses
    	
 
    	
 
    
	
 
    	
Deferred   taxes and expenses
    	
 
    	
 
    
	
 
    	
Prepaid   expenses
    	
 
    	
 
    
	
 
    	
Prepaid   assets
    	
 
    	
 
    
	
 
    	
Receivables   from shareholders, Affiliates or employees
    	
 
    	
$
    
	
22.
    	
Any   other intangible assets
    	
 
    	
$
    
	
I.(b)
    	
Total   of items 3-22
    	
 
    	
$
    

 

 

	
I.(c)
    	
Actual   Adjusted Tangible Net Worth (a minus b)
    	
 
    	
$
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
Adjusted   Tangible Net Worth Covenant
    	
 
    	
$20,000,000
    
	
 
    	
Compliance?
    	
 
    	
Yes   / No
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
II.
    	
Leverage   Ratio
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
Total   Debt divided by Adjusted Tangible Net Worth —   Actual
    	
 
    	
xx.x
    
	
 
    	
Total   Indebtedness (on and off balance sheet) - Actual
    	
 
    	
 
    
	
 
    	
[Please   insert calculations]
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
Leverage   Covenant
    	
 
    	
12:1
    
	
 
    	
Compliance?
    	
 
    	
Yes /   No
    
	
 
    	
 
    	
 
    	
 
    
	
III.
    	
Test   Period Net Income - Actual
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
Net   Income/Loss
    	
 
    	
$
    
	
 
    	
Test   Period Profitability
    	
 
    	
>=   $1.00
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
Compliance?
    	
 
    	
Yes/No
    
	
 
    	
 
    	
 
    	
 
    
	
IV.
    	
Liquidity
    	
 
    	
 
    
	
 
    	
Total   cash (other than Restricted Cash)
    	
 
    	
$
    
	
 
    	
Total   unrestricted Cash Equivalents
    	
 
    	
$
    
	
 
    	
Total
    	
 
    	
$
    
	
 
    	
Liquidity   Covenant
    	
 
    	
$7,500,000
    
	
 
    	
Compliance?
    	
 
    	
Yes /   No
    

 

 

SCHEDULE 2 TO OFFICER’S COMPLIANCE CERTIFICATE

 

INDEBTEDNESS as of                              

 

	
LENDER
    	
 
    	
TOTAL
   FACILITY
   SIZE
    	
 
    	
FACILITY
   TYPE (i.e.
   EFP,
   Repurchase,
   etc)
    	
 
    	
$ AMOUNT
   COMMITTED
    	
 
    	
OUTSTANDING
   INDEBTEDNESS
    	
 
    	
EXPIRATION
   DATE
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    

 

 

SCHEDULE 3 TO OFFICER’S COMPLIANCE CERTIFICATE

 

OVERALL MORTGAGE LOAN ORIGINATIONS

 

	
MORTGAGE
    	
 
    	
RETAIL
    	
 
    	
WHOLESALE
    	
 
    	
CORRESPONDENT
    	
 
    
	
LOAN TYPE
    	
 
    	
Units
    	
 
    	
Total $
    	
 
    	
Units
    	
 
    	
Total $
    	
 
    	
Units
    	
 
    	
Total $
    	
 
    
	
Conforming Mortgage Loans (other than Conforming High LTV loans)
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
FHA Loans
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
VA Loans
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
FHA 203(k) Loans
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Conforming High LTV Loans
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Other (please specify)
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Other (please specify)
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Other (please specify)
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Total 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    

 

 

SCHEDULE 4 TO OFFICER’S COMPLIANCE CERTIFICATE

 

INTEREST RATE PROTECTION AGREEMENTS

 

 

SCHEDULE 5 TO OFFICER’S COMPLIANCE CERTIFICATE

 

REPURCHASES AND EARLY PAYMENT DEFAULT REQUESTS

 

Outstanding/Pending Repurchases & Indemnifications

 

	
Loan #
    	
 
    	
Repo or
   Indem
    	
 
    	
Investor
    	
 
    	
Notice
   Date
    	
 
    	
Origination
   Date
    	
 
    	
Breach/Defect
    	
 
    	
Original
   Loan
   Amount
   ($)
    	
 
    	
Estimated
   Loss
   Amount
   ($)
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    

 

Satisfied/Resolved Repurchases

 

	
Loan #
    	
 
    	
Repo or
   Indem
    	
 
    	
Investor
    	
 
    	
Origination
   Date
    	
 
    	
Date Resolved
    	
 
    	
Original
   Loan
   Amount ($)
    	
 
    	
Amount
   Paid ($)
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    

 

 

SCHEDULE 6 TO OFFICER’S COMPLIANCE CERTIFICATE

 

QUALITY CONTROL RESULTS

 

 

SCHEDULE 7 TO OFFICER’S COMPLIANCE CERTIFICATE

 

Secondary Market Sales

 

	
Investor Name
    	
 
    	
Aggregate
   original principal
   balance of
   mortgage loans
   sold in prior
   calendar month
   ($)
    	
 
    	
Percentage
   (measured by
   original principal
   balance) of
   mortgage loans
   sold in prior
   calendar month
    	
 
    	
Aggregate
   original principal
   balance of
   mortgage loans
   sold year-to-date
   ($)
    	
 
    	
Percentage
   (measured by
   original principal
   balance) of
   mortgage loans
   sold year-to-date
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    

 

 

SCHEDULE 8 TO OFFICER’S COMPLIANCE CERTIFICATE

 

Geographic Production Breakdown

 

	
Current Month Geographic Concentration Top
   10 States
    	
 
    	
Current Month
   Total $
    	
 
    	
Current Month %
   of Total
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Totals
    	
 
    	
 
    	
 
    	
 
    	
 
    

 

 

SCHEDULE 9 TO OFFICER’S COMPLIANCE CERTIFICATE

 

MSR Valuation

 

 

SCHEDULE 10 TO OFFICER’S COMPLIANCE CERTIFICATE

 

Litigation Summary

 

	
Case
   Caption
    	
 
    	
Filing
   Date
    	
 
    	
Court /
   Regulator
    	
 
    	
Case
   No.
    	
 
    	
Nature
   of
   Claims
    	
 
    	
Damages /
   Penalties
   Alleged
    	
 
    	
Plaintiff’s
   Counsel
    	
 
    	
Customer’s
   counsel
    	
 
    	
Status
    	
 
    	
Customer’s 
   Reserve
   AmountExhibit 10.6

 

November 26, 2012

 

	
Excel   Mortgage Servicing, Inc.
    	
 
    	
AmeriHome   Mortgage Corporation
    
	
19500   Jamboree Road
    	
 
    	
19500   Jamboree Road
    
	
Irvine,   CA 92162
    	
 
    	
Irvine,   CA 92162
    
	
 
    	
 
    	
 
    
	
Integrated   Real Estate Service Corporation
    	
 
    	
 
    
	
19500   Jamboree Road
    	
 
    	
 
    
	
Irvine,   CA 92162
    	
 
    	
 
    

 

Re:  Fourth Amendment to Master Repurchase Agreement and Pricing Letter (“Fourth Amendment”).

 

This Fourth Amendment is made this 26th day of November, 2012 (the “Amendment Effective Date”), to that certain Master Repurchase Agreement, dated August 31, 2011 (the “Repurchase Agreement”) and the Pricing Letter, dated August 31, 2011 (the “Pricing Letter”), as amended by the First Amendment to Master Repurchase Agreement and Pricing Letter dated May 1, 2012 (the “First Amendment”), by the Second Amendment to Master Repurchase Agreement and Pricing Letter dated June 21, 2012 (the “Second Amendment”) and by the Third Amendment to Master Repurchase Agreement and Pricing Letter dated August 24, 2012 (the “Third Amendment”), in each case by and among Excel Mortgage Servicing, Inc. and AmeriHome Mortgage Corporation (each a “Seller” and, collectively, “Sellers”), and EverBank (“Buyer”).  The Repurchase Agreement, the Pricing Letter, the First Amendment, the Second Amendment and the Third Amendment are sometimes hereinafter collectively referred to as the “Agreement.”

 

WHEREAS, Sellers and Integrated Real Estate Service Corporation (“Guarantor”) requested that Buyer amend the Agreement; and

 

WHEREAS, Sellers, Guarantor and Buyer have agreed to amend the Agreement as set forth herein.

 

NOW THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto hereby agree to amend the Agreement as follows:

 

SECTION 1.                            Amendments.

 

(a)                                 The following definitions contained in Section 1 of the Pricing Letter are hereby amended and restated in their entirety as follows:

 

 

“‘Pricing Spread’ shall mean:

 

	
Type of Mortgage Loan
    	
 
    	
Percentage
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
Conforming Mortgage Loans, Eligible Government   Mortgage Loans, Eligible Correspondent Mortgage Loans, Category 1 High   LTV VA Refinance Loans and Jumbo Mortgage Loans
    	
 
    	
3.25
    	
%
    
	
 
    	
 
    	
 
    	
 
    
	
Category 2 High LTV VA Refinance Mortgage Loans
    	
 
    	
3.50
    	
%
    
	
 
    	
 
    	
 
    	
 
    
	
DU Refi Plus Loans
    	
 
    	
3.50
    	
%
    
	
 
    	
 
    	
 
    	
 
    
	
Aged Mortgage Loans
    	
 
    	
4.00
    	
%
    
	
 
    	
 
    	
 
    	
 
    
	
Mortgage Loans exceeding the applicable   Transaction Term Limitation
    	
 
    	
12.00
    	
%
    

 

Where a Purchased Mortgage Loan may qualify for two or more Pricing Spreads hereunder, unless otherwise expressly agreed to by the Buyer in writing, such Purchased Mortgage Loan shall be assigned the higher Pricing Spread, as applicable.”

 

 

“‘Purchase Price Percentage’ shall mean:

 

	
Type of Mortgage Loan
    	
 
    	
Percentage
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
Conforming Mortgage Loans, Eligible Government   Mortgage Loans, Jumbo Loans with Buyer as the Takeout Investor
    	
 
    	
98%
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
Category 1 High LTV VA Refinance Mortgage Loans
    	
 
    	
95%
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
Category 2 High LTV VA Refinance Mortgage Loans
    	
 
    	
90%
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
Jumbo Mortgage Loans with Takeout Investor other   than Buyer
    	
 
    	
95%
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
Eligible Correspondent Mortgage Loans
    	
 
    	
97%
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
DU Refi Plus Loans
    	
 
    	
95%
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
Aged Mortgage Loans
    	
 
    	
The applicable percentage set forth above minus 10%
    	
 
    

 

Where a Purchased Mortgage Loan may qualify for two or more Purchase Price Percentages hereunder, unless otherwise expressly agreed to by Buyer in writing, such Purchased Mortgage Loan shall be assigned the lower Purchase Price Percentage, as applicable.”

 

“‘Termination Date’ shall mean the earliest of (i) November 25, 2013, (ii) such date as Buyer may determine in its sole discretion by written notice to Seller (provided that in the event of such notice of termination, the Repurchase Date with respect to outstanding Transactions shall not be accelerated in the absence of (a) an Event of Default or (b) the occurrence of a termination in accordance with clauses (i) or (iii) of this definition) or (iii) such date as determined by Buyer pursuant to its rights and remedies under the Agreement.”

 

(b)                                 Section 2 of the Pricing Letter is hereby amended and restated in its entirety as follows:

 

“SECTION 2.                                                 Reserved.”

 

(c)                                  Section 3 of the Pricing Letter is hereby amended and restated in its entirety as follows:

 

“SECTION 3.                  Certain Financial Condition Covenants.  Without limiting any provision set forth in the Agreement, the applicable Seller Party shall comply with the

 

 

following covenants, each to be tested on each Test Date occurring prior to the Termination Date, and each to be determined on a consolidated basis with such Person’s Subsidiaries (including AmeriHome, with respect to Excel):

 

(i)                    Maintenance of Adjusted Tangible Net Worth.  (a) Excel shall maintain an Adjusted Tangible Net Worth of not less than $10,000,000.00, and (b) Guarantor shall maintain an Adjusted Tangible Net Worth of not less than $15,000,000.00.

 

(ii)                 Maintenance of Ratio of Adjusted Indebtedness to Adjusted Tangible Net Worth.  Excel shall maintain the ratio of its Adjusted Indebtedness to its Adjusted Tangible Net Worth of no greater than 15:1.

 

(iii)              Operating Cash Flow to Debt Service Ratio.  Excel shall maintain on a trailing six-month basis the ratio of (a) its Operating Cash Flow to (b) its Debt Service of at least 1.00:1.00.

 

(iv)             Maintenance of Liquidity.  Excel shall ensure that it has cash and Cash Equivalents (excluding Restricted Cash or cash pledged to Persons other than Buyer), in an amount not less than the greater of (a) $2,000,000.00, and (b) an amount equal to 20% of its Adjusted Tangible Net Worth.

 

(v)                Maintenance of Profitability. Excel shall not permit, for the four (4) consecutive fiscal quarters ending on the relevant Test Date, Seller’s Net Income for such four (4) consecutive fiscal quarters (on an aggregate basis) to be less than $1.00.”

 

(d)                                 Sellers shall update the Compliance Certificate attached as Exhibit A to the Pricing Letter to reflect the revised financial covenants set forth in Section 1(c) of this Fourth Amendment.

 

(e)                                  The following definitions contained in Section 2 of the Repurchase Agreement are hereby amended and restated in their entirety as follows:

 

“‘Adjusted Tangible Net Worth’ shall mean, with respect to any Person at any date, the Net Worth of such Person plus (a) (i) all unpaid principal of all Subordinated Debt of such Person at such date; and (ii) the MSR Value at such date; minus:  (b) (i) the aggregate book value of all intangible assets of such Person (as determined in accordance with GAAP), including, without limitation, goodwill; trademarks, trade names, service marks, copyrights, patents, licenses and franchises; capitalized Servicing Rights; organizational expenses; and deferred expenses; (ii) receivables from equity owners, Affiliates or employees; (iii) advances of loans to Affiliates; (iv) investments in Affiliates; (v) assets pledged to secure any liabilities not included in the Indebtedness of such Person; and (vi) any other assets which would be deemed by HUD to be unacceptable in calculating adjusted tangible net worth; in all cases, calculated on a consolidated basis and determined in accordance with GAAP consistent with those applied in the preparation of the Financial Statements referred to herein.”

 

 

“‘LIBOR Rate’ shall mean, with respect to each day a Transaction is outstanding, the rate per annum equal to the rate appearing at  Reuters Screen LIBOR01 Page (or such other page as may replace the Reuters LIBOR01 Page on such service or such other service as may be designated by Buyer for the purpose of displaying London interbank offered rates for U.S. Dollar deposits) as one month LIBOR on such date (and if such date is not a Business Day, the LIBOR Rate in effect on the Business Day immediately preceding such date), and if such rate shall not be so quoted, the rate per annum at which Buyer or its Affiliate is offered dollar deposits at or about 10:00 a.m., New York City time, on such date, by prime banks in the interbank eurodollar market where the eurodollar and foreign currency exchange operations in respect of its Transactions are then being conducted for delivery on such day for a period of one month and in an amount comparable to the amount of the Transactions outstanding on such day. “

 

(f)                                   The definitions of “LIBOR Floor” contained in the Repurchase Agreement and the Pricing Letter are hereby deleted.

 

(g)                                  Section 3(c)(i) of the Repurchase Agreement is hereby amended and restated in its entirety as follows:

 

“(i)             The applicable Seller shall deliver a Transaction Request through the EverBank Warehouse Electronic System to Buyer on or prior to the date and time set forth in Section 3(b)(vi) prior to entering into any Transaction.  Such Transaction Request shall include all information required by Buyer pursuant to the EverBank Warehouse Customer Guide.  Following receipt of such request, Buyer may in its sole discretion agree to enter into such requested Transaction, in which case it will fund the Purchase Price therefor as contemplated in this Agreement.  Buyer’s funding the Purchase Price of the Transaction and Seller’s acceptance thereof, will constitute the parties agreement to enter into such Transaction.  Buyer shall confirm the terms of each Transaction on the EverBank Warehouse Electronic System, including information that sets forth (A) the Purchase Date, (B) the Purchase Price, (C) the Repurchase Date, (D) the Pricing Rate applicable to the Transaction, (E) the applicable Purchase Price Percentages, and (F) additional terms or conditions not inconsistent with this Agreement; provided that Buyer’s failure to enter the information into the EverBank Warehouse Electronic System shall not affect the obligations of Sellers with respect to such Transaction.  This Agreement is not a commitment by Buyer to enter into Transactions with Seller but rather sets forth the procedures to be used in connection with periodic requests for Buyer to enter into Transactions with Seller.  Seller hereby acknowledges that Buyer is under no obligation to agree to enter into, or to enter into, any Transaction pursuant to this Agreement. “

 

(h)                                 Section 3(c)(iii) of the Repurchase Agreement is hereby amended and restated in its entirety as follows:

 

 

“(iii)  Except as otherwise provided in the definition of Termination Date, the Repurchase Date for each Transaction shall not be later than the Termination Date.”

 

(i)                                     Section 12 of the Repurchase Agreement is hereby amended by adding to the end thereof a new subsection (bb) as follows:

 

(bb)        Minimum Reserve Amount.  Sellers shall at all times maintain the Minimum Reserve Amount in the Reserve Account.  In the event Buyer makes any withdrawal from the Reserve Account, Buyer shall provide Sellers notice of such withdrawal and Sellers shall have one (1) Business Day following such notice to deposit sufficient funds in the Reserve Account to satisfy the Minimum Reserve Amount.  Buyer shall have the right, but not the obligation, at any time and from time to time to transfer funds from the Inbound Account or the Haircut Account to the Reserve Account to maintain the Minimum Reserve Amount.

 

SECTION 2.                            Defined Terms.  Any terms capitalized but not otherwise defined herein should have the respective meanings set forth in the Agreement.

 

SECTION 3.                            Limited Effect.  Except as amended hereby, the Agreement shall continue in full force and effect in accordance with its terms.  Reference to this Fourth Amendment need not be made in the Agreement or any other instrument or document executed in connection therewith, or in any certificate, letter or communication issued or made pursuant to, or with respect to, the Agreement, any reference in any of such items to the Agreement being sufficient to refer to the Agreement as amended hereby.

 

SECTION 4.                            Representations.  In order to induce Buyer to execute and deliver this Fourth Amendment, each Seller hereby represents to Buyer that as of the date hereof, except as otherwise expressly waived by Buyer in writing, such Seller is in full compliance with all of the terms and conditions of the Agreement including without limitation, all of the representations and warranties and all of the affirmative and negative covenants, and no Default or Event of Default has occurred and is continuing under the Agreement.

 

SECTION 5.                            Governing Law. This Fourth Amendment and any claim, controversy or dispute arising under or related to or in connection with this Fourth Amendment, the relationship of the parties, and/or the interpretation and enforcement of the rights and duties of the parties will be governed by the laws of the State of New York without regard to any conflicts of law principles other than Sections 5-1401 and 5-1402 of the New York General Obligations Law which shall govern.

 

SECTION 6.                            Counterparts.  This Fourth Amendment may be executed in two (2) or more counterparts, each of which shall be deemed an original but all of which together shall constitute but one and the same agreement.  This Fourth Amendment, to the extent signed and delivered by facsimile or other electronic means, shall be treated in all manner and respects as an original agreement and shall be considered to have the same binding legal effect as if it were the original signed version thereof delivered in person.  No signatory to this Fourth Amendment shall raise the use of a facsimile machine or other electronic means to deliver a signature or the fact that any signature or agreement was transmitted or communicated through

 

 

the use of a facsimile machine or other electronic means as a defense to the formation or enforceability of a contract and each such Person forever waives any such defense.

 

SECTION 7.                            Guarantor.  Guarantor acknowledges and agrees that nothing contained herein, and Guarantor’s signature hereon, shall not be deemed an acknowledgement, a course of conduct, a waiver or an amendment of the provisions of the Facility Guaranty, which continue in full force and effect and do not require any Guarantor’s consent to the actions taken hereunder.

 

[Signature Page Follows]

 

 

IN WITNESS WHEREOF, Sellers, Guarantor and Buyer have caused this Fourth Amendment to be executed and delivered as of the Amendment Effective Date.

 

	
EXCEL MORTGAGE SERVICING,
    	
 
    	
EVERBANK, as Buyer
    
	
INC., as a Seller
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
By:
    	
/s/ Todd R. Taylor
    	
 
    	
By:
    	
/s/ Paul Chmielinski
    
	
Name:
    	
Todd R. Taylor
    	
 
    	
Name:
    	
Paul Chmielinski
    
	
Title:
    	
EVP/CFO
    	
 
    	
Title:
    	
V,P.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
AMERIHOME MORTGAGE
    	
 
    	
INTEGRATED REAL ESTATE
    
	
CORPORATION, as a Seller
    	
 
    	
SERVICE CORPORATION, as Guarantor
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
By:
    	
/s/ Todd R. Taylor
    	
 
    	
By:
    	
/s/ Todd R. Taylor
    
	
Name:
    	
Todd R. Taylor
    	
 
    	
Name:
    	
Todd R. Taylor
    
	
Title:
    	
EVP/CFO
    	
 
    	
Title:
    	
EVP/CFO

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