EXHIBIT 10.16
SECOND AMENDMENT TO CREDIT AGREEMENT
THIS SECOND AMENDMENT TO CREDIT AGREEMENT (herein called this
"Amendment") made as of November 22, 2002 by and among PREFERRED HOME MORTGAGE
COMPANY, a Florida corporation ("Preferred"), TECHNICAL MORTGAGE, L.P., a Texas
limited partnership ("Technical Mortgage"; Preferred and Technical Mortgage,
collectively "Borrowers"), and GUARANTY BANK ("Lender").
W I T N E S S E T H:
WHEREAS, Borrowers and Lender have entered into that certain Credit
Agreement dated as of August 1, 2002 (as heretofore amended, the "Original
Credit Agreement"), for the purposes and consideration therein expressed,
pursuant to which Lender became obligated to make loans to Borrowers as therein
provided; and
WHEREAS, Borrowers and Lender desire to amend the Original Credit
Agreement as provided herein;
NOW, THEREFORE, in consideration of the premises and the mutual
covenants and agreements contained herein and in the Original Credit Agreement,
in consideration of the loans which may hereafter be made by Lender to
Borrowers, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto do hereby agree
as follows:
ARTICLE I.
Definitions and References
ss. 1.1. Terms Defined in the Original Credit Agreement. Unless the
context otherwise requires or unless otherwise expressly defined herein, the
terms defined in the Original Credit Agreement shall have the same meanings
whenever used in this Amendment.
ss. 1.2. Other Defined Terms. Unless the context otherwise requires,
the following terms when used in this Amendment shall have the meanings assigned
to them in this ss.1.2.
"Amendment" has the meaning set forth in the introductory
paragraph hereto.
SECOND AMENDMENT TO RESTATED CREDIT AGREEMENT
"Amendment Documents" means, collectively, this Amendment and
the confirmation by Guarantor with respect to this Amendment.
"Credit Agreement" means the Original Credit Agreement as
amended hereby.
"Original Omnibus Certificate" means the Omnibus Certificate
dated August 1, 2002 executed and delivered by officers of Borrowers
pursuant to the Original Credit Agreement.
ARTICLE II.
Amendments to Original Credit Agreement
ss. 2.1. Definitions. The definition of "Alt A/Subprime Sublimit" in
Section 1.1 of the Original Credit Agreement is hereby amended in its entirety
to read as follows:
"'ALT A/SUBPRIME SUBLIMIT' means twenty percent (20%) of the
Commitment."
ARTICLE III.
Conditions of Effectiveness
ss. 3.1. Effective Date. This Amendment shall become effective as of
the date first above written when and only when Lender shall have received, at
Lender's office,
(a) a duly executed counterpart of this Amendment,
(b) a duly executed Consent and Agreement in the form of
Exhibit A hereto,
(c) a duly executed certificate of the president - chief
executive officer and secretary of Preferred certifying that (i) the
specimen signatures of certain duly elected, qualified and acting
officers of Preferred attached to the Officers' Certificate dated as of
October 15, 2002 are true and correct, (ii) resolutions of its board of
directors attached to the Original Omnibus Certificate authorizing the
execution, delivery, and performance of this Amendment are in full
force and effect, (iii) the Articles of Incorporation and Bylaws of
Preferred attached to the Original Omnibus Certificate have not been
amended since the date of such Certificate,
(d) a duly executed certificate of the president - chief
executive officer and secretary of General Partner certifying that (i)
the specimen signatures of certain duly elected, qualified and acting
officers of General Partner attached to the Officers' Certificate dated
as of October 15, 2002 are true and correct, (ii) resolutions of the
board of directors of Preferred by
2 SECOND AMENDMENT TO RESTATED CREDIT AGREEMENT
its authority as managing member of General Partner, attached to the
Original Omnibus Certificate authorizing the execution, delivery, and
performance of this Amendment are in full force and effect, (iii) the
Articles of Organization and Members' Agreement of General Partner
attached to the Original Omnibus Certificate have not been amended
since the date of such Certificate, and (iv) the Certificate of Limited
Partnership and the Amended and Restated Agreement of Limited
Partnership of Technical Mortgage have not been amended since the date
of such Certificate,
(e) each other document to be executed and delivered by
Borrowers pursuant hereto or thereto.
ARTICLE IV.
Representations and Warranties
ss. 4.1. Representations and Warranties of Borrowers. In order to
induce Lender to enter into this Amendment, each Borrower represents and
warrants to Lender that:
(a) The representations and warranties contained in
Article IV of the Original Credit Agreement are true and correct at and
as of the time of the effectiveness hereof;
(b) Each Borrower is duly authorized to execute and
deliver this Amendment and the other Amendment Documents and is and
will continue to be duly authorized to borrow and to perform its
obligations under the Credit Agreement. Each Borrower has duly taken
all corporate action necessary to authorize the execution and delivery
of this Amendment and the other Amendment Documents and to authorize
the performance of the obligations of such Borrower hereunder and
thereunder;
(c) The execution and delivery by each Borrower of this
Amendment and the other Amendment Documents, the performance by such
Borrower of its obligations hereunder and thereunder and the
consummation of the transactions contemplated hereby do not and will
not conflict with any provision of law, statute, rule or regulation or
of the articles of incorporation and bylaws of such Borrower, or of any
material agreement, judgment, license, order or permit applicable to or
binding upon such Borrower, or result in the creation of any lien,
charge or encumbrance upon any assets or properties of such Borrower.
Except for those which have been duly obtained, no consent, approval,
authorization or order of any court or governmental authority or third
party is required in connection with the execution and delivery by
either Borrower of this Amendment and the other Amendment Documents or
to consummate the transactions contemplated hereby and thereby;
3 SECOND AMENDMENT TO RESTATED CREDIT AGREEMENT
(d) When duly executed and delivered, each of this
Amendment and the other Amendment Documents will be a legal and binding
instrument and agreement of each Borrower, enforceable in accordance
with its terms, except as limited by bankruptcy, insolvency and similar
laws applying to creditors' rights generally and by principles of
equity applying to creditors' rights generally; and
(e) The draft of audited annual Consolidated financial
statements of Borrowers dated as of December 31, 2001 and the unaudited
quarterly Consolidated financial statements of Borrowers dated as of
September 30, 2002 fairly present the Consolidated financial position
at such dates and the Consolidated statement of operations and the
changes in Consolidated financial position for the periods ending on
such dates for Borrowers. Copies of such financial statements have
heretofore been delivered to Bank. Since such dates no material adverse
change has occurred in the financial condition or businesses or in the
Consolidated financial condition or businesses of Borrowers.
ARTICLE V.
Miscellaneous
ss. 5.1. Ratification of Agreement and Guaranties.
(a) The Original Credit Agreement as hereby amended is
hereby ratified and confirmed in all respects. Any reference to the
Credit Agreement in any Loan Document shall be deemed to refer to this
Amendment also. Any reference to the Note in any other Loan Document
shall be deemed to be a reference to the Renewal Note issued and
delivered pursuant to this Amendment. The execution, delivery and
effectiveness of this Amendment, the other Amendment Documents, shall
not, except as expressly provided herein, operate as a waiver of any
right, power or remedy of Lender under the Credit Agreement or any
other Loan Document nor constitute a waiver of any provision of the
Credit Agreement or any other Loan Document.
(b) Each Borrower hereby ratifies and confirms the
Guaranty dated as of August 1, 2002 made by it for the benefit of
Lender covering the Obligations of the other Borrower, and agrees that
its obligations and covenants thereunder are unimpaired hereby and
shall remain in full force and effect.
ss. 5.2. Survival of Agreements. All representations, warranties,
covenants and agreements of Borrowers herein shall survive the execution and
delivery of this Amendment and the performance hereof, and shall further survive
until all of the Obligations are paid in full. All statements and agreements
contained in any certificate or instrument delivered by Borrowers hereunder or
under the Credit Agreement to Lender shall be deemed to constitute
representations and warranties by, or agreements and covenants of, Borrowers
under this Amendment and under the Credit Agreement.
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ss. 5.3. Loan Documents. This Amendment and the other Amendment
Documents are each a Loan Document, and all provisions in the Credit Agreement
pertaining to Loan Documents apply hereto and thereto.
ss. 5.4. Governing Law. This Amendment shall be governed by and
construed in accordance with the laws of the State of Texas and any applicable
laws of the United States of America in all respects, including construction,
validity and performance.
ss. 5.5. Counterparts; Fax. This Amendment may be separately executed
in counterparts and by the different parties hereto in separate counterparts,
each of which when so executed shall be deemed to constitute one and the same
Amendment. This Amendment may be duly executed by facsimile or other electronic
transmission.
THIS AMENDMENT AND THE OTHER LOAN DOCUMENTS REPRESENT THE FINAL
AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR,
CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES.
THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.
[THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK.]
5 SECOND AMENDMENT TO RESTATED CREDIT AGREEMENT
IN WITNESS WHEREOF, this Amendment is executed as of the date first
above written.
BORROWERS: PREFERRED HOME MORTGAGE COMPANY
By: /s/ Paul Leikert
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Name: Paul Leikert
Title: President
TECHNICAL MORTGAGE, L.P.
By: TM INVESTMENTS, L.L.C., its General Partner
By: /s/ Paul Leikert
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Name: Paul Leikert
Title: President
LENDER: GUARANTY BANK
By: /s/ Carolyn Eskridge
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Carolyn Eskridge
Senior Vice President
SECOND AMENDMENT TO RESTATED CREDIT AGREEMENT
THE STATE OF )
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COUNTY OF )
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This instrument was acknowledged before me on _________________, 2002,
by ___________________________, ___________________ of PREFERRED HOME MORTGAGE
COMPANY, a Florida corporation, on behalf of said corporation.
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Notary Public, State of
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(printed name)
My Commission Expires:
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THE STATE OF )
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COUNTY OF )
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This instrument was acknowledged before me on _______________, 2002, by
______________________, _______________________ of TM INVESTMENTS, L.L.C., a
Texas limited liability company, the general partner of TECHNICAL MORTGAGE,
L.P., a Texas limited partnership, on behalf of said partnership.
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Notary Public, State of
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(printed name)
My Commission Expires:
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SECOND AMENDMENT TO RESTATED CREDIT AGREEMENT
EXHIBIT A
CONSENT AND AGREEMENT
TECHNICAL OLYMPIC USA, INC. hereby consents to the provisions of this
Amendment and the transactions contemplated herein, and hereby ratifies and
confirms the Guaranty dated as of August 1, 2002 made by it for the benefit of
Lender, and agrees that its obligations and covenants thereunder are unimpaired
hereby and shall remain in full force and effect.
TECHNICAL OLYMPIC USA, INC.
By:
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Name:
Title:
SECOND AMENDMENT TO RESTATED CREDIT AGREEMENT