Exhibit 10.4
FORM OR REAL ESTATE ASSET SERVICING AGREEMENT
This LOAN SERVICING AGREEMENT (the "Agreement") is dated April ___, 1998
between Wilshire Credit Corporation, a Nevada corporation (the "Servicer"), and
Wilshire Real Estate Investment Trust Inc., a Maryland corporation (the
"Company").
RECITALS
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The Company and certain of its affiliates intend to acquire and/or
originate mortgage loans, real estate mortgage backed securities and other real
estate related assets in the United States (the "Real Estate Assets") during
the term of this Agreement. The Company desires that the Servicer service such
loans and the Servicer desires to do the same.
The parties hereby agree for good and valuable consideration as follows:
1. Exclusive Servicing of Real Estate Assets. The Servicer shall provide
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portfolio management services, including billing, portfolio administration and
collection services ("Services") for all Real Estate Assets unless the Servicer
and the Company agree that specific Real Estate Assets shall not be so serviced
("Excluded Real Estate Assets"). The Company agrees that the Servicer shall not
be required to service Real Estate Assets for which the Servicer may not have
applicable licenses. The Company agrees that all of its Real Estate Assets and
any Affiliate's Real Estate Assets, except for Excluded Real Estate Assets,
shall be serviced by the Servicer under this Agreement. The Company or one of
its subsidiaries (or any partnership managed by it) shall assign all of its
servicing rights (including any Special Servicing Rights as described in the
Company's prospectus relating to its initial public offering) with respect to
any Real Estate Assets acquired by it to the Servicer; provided, however, with
respect to Special Servicing Rights, the Company shall retain the right to
direct foreclosure.
2. Manner and Performance of Service. Except as otherwise specifically
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provided herein, the Servicer shall be entitled to exercise its sole discretion
in servicing the Real Estate Assets. The Servicer shall devote such time and
attention as shall be necessary to provide the Company with the Services
described herein. The Servicer may service its own loans, real estate and
financial assets and render services to any current or future clients, provided
that such activities do not interfere with the Servicer's performance of the
Services. The Services to be provided by the Servicer include the following:
2.1 The Servicer's Duties in General. The Servicer shall administer
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the Real Estate Assets with reasonable care, using that degree of skill and
attention that the Servicer exercises with respect to comparable Real Estate
Assets that it services for its own account or as a fiduciary for others. The
Servicer shall take all necessary actions which the Servicer in good faith
determines are commercially reasonable in regard to each Real Estate Asset,
which in the case of a loan shall continue until it is collected or the
Servicer, in its good faith judgment, determines that it is no longer
commercially reasonable to continue to try to collect the outstanding
indebtedness on such loan.
2.2 Compliance. The Servicer shall use its best efforts to comply
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throughout the term of this Agreement with all requirements of applicable
federal, state and local laws and foreign laws and regulations thereunder,
including to the extent applicable, any consumer and debt collection protection
laws and any other consumer credit, equal opportunity and disclosure laws.
2.3 Collection. The Servicer shall use its reasonable efforts, but
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not less than the same efforts it uses with respect to comparable Real Estate
Assets that it services for its own account or for others, to collect all
payments due and to become due under each of the Real Estate Assets from the
party or parties liable thereunder (a "Borrower").
2.4 Subcontractors. The Servicer may subcontract services, subject
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to the approval of Wilshire Realty Services Corporation, a Delaware corporation
("WRSC"), but no such subcontract shall relieve or reduce the Servicer's
obligations to perform services as provided in this Agreement.
2.5 Indemnity. The Servicer shall reimburse and indemnify the
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Company and its successors and assigns for and against, and hold the Company and
its successors and assigns harmless from and against, any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses and disbursements, including without limitation reasonable fees and
disbursements of counsel, which may be imposed upon, or incurred by the Company
in any way relating to or arising out of the Servicer's gross negligence in its
performance of its duties hereunder. The Company shall reimburse and indemnify
the Servicer and its successors and assigns for and against, and hold the
Servicer and its successors and assigns harmless from and against, any and all
liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
costs, expenses and disbursements, including without limitation reasonable fees
and disbursements of counsel, which may be imposed upon, or incurred by the
Servicer in any way relating to or arising out of the Servicer's performance of
its duties hereunder, the Real Estate Assets or the servicing thereof prior to
the servicing by the Servicer other than arising out of the Servicer's gross
negligence.
2.6 Modifications, Adjustable Rate, and Payoffs. In connection with
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its collection efforts the Servicer may modify or change the interest rate of
any loan, and quote to, and accept from, a Borrower a full or partial payoff
amount on any loan as full settlement.
2.7 Monthly Accounting Reports. For each month during the term of
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this Agreement, the Servicer will furnish the Company with a monthly report
regarding the Real Estate Assets by the twenty-fifth (25th) day of the following
month. The Servicer shall furnish at the Servicer's cost such other information
regarding the Servicer, the Real Estate Assets and this Agreement as the Company
may from time to time reasonably request, provided, that if the information or
data requested by the Company is something the Servicer cannot produce
internally from its then existing reporting systems without manual compilation
or production, or reprogramming its computer system, the Company shall reimburse
the Servicer for its cost for furnishing such information.
3. Term. This Agreement shall commence on the date hereof and shall
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continue in force for two (2) years, and thereafter, will automatically renew
for successive one-year periods
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unless either party delivers a notice of termination at least 120 days prior to
the end of the then current term. Notwithstanding any other provision to the
contrary, this Agreement shall be terminated if the Management Agreement, dated
April __, 1998, between the Company and WRSC is terminated by either the
Company or WRSC.
4. Subservicing Agreements.
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4.1 Engagement of Subservicer. The Servicer shall not enter into
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Subservicing Agreements, permit the subservicing of, or delegate any of its
duties to any Subservicers with respect to, all or part of the Real Estate
Assets except under the circumstances described in the next sentence or as
approved by WRSC. In the event that the Servicer is not permitted to service
one or more Real Estate Assets in any jurisdiction pursuant to the laws,
ordinances, rules or regulations ("Laws") of such jurisdiction that are
applicable to such Real Estate Assets, the Servicer may retain a Subservicer
under a Subservicing Agreement for the purpose of performing any servicing of
such Real Estate Assets that the Servicer is not permitted by such Laws to
perform; provided, however, that (i) such Subservicer shall be retained only for
so long as and to the extent that such Laws do not permit the Servicer to
perform particular servicing duties, and (ii) the Servicer shall take such
actions (including obtaining any necessary licenses or qualifications and paying
any necessary fees in connection therewith) as shall be necessary in order for
the Servicer to be permitted, as promptly as possible, to service the applicable
Real Estate Assets in the applicable jurisdiction directly. Unless otherwise
set forth in the related acknowledgment agreement (the "Acknowledgment
Agreement"), with respect to each Real Estate Asset, the Servicer by its
execution of the related Acknowledgment Agreement shall be deemed to have
represented and warranted to the Company that as of the date of such execution
there are no Laws enacted or proposed to be enacted applicable to the related
Real Estate Assets that would not permit the Servicer to service such Real
Estate Assets directly and without the use of a Subservicer. The Servicer shall
notify the Company and/or WRSC of each Subservicing Agreement entered into by it
pursuant to this Section 4.1 within twenty (20) business days after such
Subservicing Agreement is entered into, which notice shall set forth the reasons
such Subservicing Agreement is necessary and is permitted under this Section 4.1
and shall attach a copy of such Subservicing Agreement. The Servicer shall also
notify the Company and/or WRSC as soon as any Subservicing Agreement is no
longer necessary with respect to any Real Estate Assets and shall immediately
terminate such Subservicing Agreement as to such Real Estate Assets. Each
Subservicing Agreement shall provide that it is terminable at will without
payment of a termination fee or penalty.
4.2 Qualification to do Business. Each Subservicer shall be licensed
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to transact business and to perform its obligations under its Subservicing
Agreement in each jurisdiction required by the Laws applicable to the Real
Estate Assets being serviced by such Subservicer. Each Subservicing Agreement
will be upon such terms and conditions as are not inconsistent with this
Agreement and as the Servicer and the Subservicer have agreed. As part of its
servicing activities hereunder, the Servicer shall enforce the obligations of
each Subservicer under the related Subservicing Agreement.
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4.3 Liability. Notwithstanding any Subservicing Agreement, any of
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the provisions of this Agreement relating to agreements or arrangements between
the Servicer and Subservicer or reference to actions taken through a Subservicer
or otherwise, the Servicer shall remain obligated and liable to the Company for
the servicing and administering of the Real Estate Assets in accordance with the
provisions of this Agreement without diminution of such obligation or liability
by virtue of indemnification from a Subservicer and to the same extent and under
the same terms and conditions as if the Servicer alone were servicing and
administering the Real Estate Assets.
4.4 Indemnity. Any Subservicing Agreement and any other transactions
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or services relating to the Real Estate Assets involving a Subservicer shall be
deemed to be between such Subservicer and Servicer alone, and the Company shall
have no obligation, duty or liability with respect to such Subservicer,
including, without limitation, any obligation, duty or liability to pay such
Subservicer's fees and expenses. For purposes of remittances by the Servicer
pursuant to this Agreement, the Servicer shall be deemed to have received a
payment on a Mortgage Loan when the applicable Subservicer has received such
payment.
4.5 Action of Subservicer. References in this Agreement to actions
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taken or to be taken by the Servicer in servicing the Real Estate Assets include
actions taken or to be taken by a Subservicer on behalf of the Servicer to the
extent that under applicable Laws the Servicer may not take such actions
directly.
5. Maintenance of Insurance and Errors and Omissions and Fidelity
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Coverage.
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5.1 Insurance Coverage Requirements. The Servicer shall use its best
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efforts to cause the Borrower to maintain for each Real Estate Assets all
insurance required by the terms of the documents for the amounts set forth
therein. If the Borrower fails to maintain such insurance, then the Servicer
shall notify the Company and/or WRSC of such failure and cause to be maintained
prior to the termination of any existing such policy, or if there is no existing
such policy, as promptly as is practicable and as conforms with accepted
servicing practices (i) fire and hazard insurance with extended coverage in an
amount which is at least equal to the lesser of the current principal balance of
such Real Estate Assets and the replacement cost of the improvements which are
a part of the related Real Estate Assets and (ii) to the extent that the Real
Estate Assets are located in a federally designated special flood hazard area,
flood insurance in respect thereof. Such flood insurance shall be in an amount
equal to the lesser of (y) the unpaid principal balance of the Real Estate
Assets or (z) the maximum amount of such insurance as is available for the Real
Estate Assets under the National Flood Insurance Act. After notifying the
Company pursuant to the second preceding sentence, the Servicer shall take such
action as the Company and/or WRSC reasonably requests with respect to the
maintenance of any other forms of insurance which are required to be maintained
pursuant to the documents of the Real Estate Assets. Any amounts collected by
the Servicer under any such policies (other than amounts to be applied to the
restoration or repair of the Real Estate Assets or amounts released to the
Borrower in accordance with the terms of the Real Estate Assets) shall be
deposited in the escrow accounts. To the extent the Servicer has expended its
own funds to pay for insurance premiums under this Subsection 5.1,
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the cost of such premiums shall be deemed a servicing advance. The Servicer
shall promptly notify the Company and/or WRSC if there is a change of an
insurance carrier, an increase in the deductible, or a decrease in the scope or
amount of coverage, with respect to any insurance policy required to be
maintained by a Borrower under the documents for the Real Estate Assets.
5.2 Blanket Policy. In the event that the Servicer shall obtain and
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maintain a blanket policy insuring against losses on all of the Real Estate
Assets with a qualified insurer, to the extent such policy provides no less
coverage in scope and amount with respect to each Real Estate Assets than the
insurance required to be maintained by the Servicer pursuant to Section 5.1, the
Servicer shall conclusively be deemed to have satisfied its obligations as set
forth in Section 5.1, it being understood and agreed that such policy may
contain a deductible clause, in which case the Servicer shall, in the event that
there shall not have been maintained on any Real Estate Assets a policy
complying with Section 5.1 and there shall have been a loss which would have
been covered by such policy, deposit in the custodial account the amount not
otherwise payable under the blanket policy because of such deductible clause to
the extent that any such deductible exceeds the deductible limitation that
pertained to the Real Estate Assets, or, in the absence of any such deductible
limitation, the deductible limitation which is consistent with accepted
servicing practices. Any such deposit by the Servicer shall be made prior to the
remittance date upon which the proceeds represented by such deposit are required
to be distributed to the Company. In connection with its activities as
administrator and servicer of the Real Estate Assets, the Servicer agrees to
present, on behalf of itself and the Company, claims under any such blanket
policy.
5.3 Master Policy. If the Servicer causes any Real Estate Assets to
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be covered by a master single interest insurance policy naming the Servicer on
behalf of the Company as the loss payee, which policy is issued by a qualified
insurer to the extent such policy provides no less coverage in scope and amount
for such Real Estate Assets than the insurance required to be maintained by the
Servicer pursuant to Section 5.1, the Servicer shall conclusively be deemed to
have satisfied its obligation set forth in Section 5.1. in the event that the
Servicer shall cause any Real Estate Assets to be covered by such a master
single interest insurance policy, the incremental costs of such insurance
applicable to such Real Estate Assets (i.e., other than any minimum or standby
premium payable for such policy whether or not any Real Estate Assets is covered
thereby) shall be paid by the Servicer as a servicing advance. Such master
single interest policy may contain a deductible clause, in which case the
Servicer shall, in the event that there shall not have been maintained on the
related Real Estate Assets a policy otherwise complying with the provisions of
Section 5.1, and there shall have been one or more losses which would have been
covered by such a policy had it been maintained, deposit into the custodial
account from its own funds the amount not otherwise payable under the master
single interest policy because of such deductible clause to the extent that any
such deductible exceeds the deductible limitation that pertained to the related
Real Estate Assets, or, in the absence of any such deductible limitation, the
deductible limitation which is consistent with accepted servicing practices.
5.4 Servicer Bond and Insurance Requirement for Officer and
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Directors. The Servicer shall obtain and maintain at its own expense, and keep
in full force and effect throughout the term of this Agreement, a blanket
fidelity bond and an errors and omissions insurance policy
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covering the Servicer's officers and employees acting on behalf of the Servicer
in connection with its activities under this Agreement. The amount of such
coverage shall meet the servicing requirements of prudent institutional
commercial mortgage loan servicers. In the event that any such bond or policy
ceases to be in effect, the Servicer shall obtain a comparable replacement bond
or policy. Coverage of the Servicer under a policy or bond obtained by an
affiliate of the Servicer and providing the coverage required by this Section
shall satisfy the requirements of this Section.
6. Annual Statement as to Compliance. The Servicer will deliver to the
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Company, on or before December 31 of each year, beginning December 31, 1998, an
officer's certificate stating as to each signatory thereof, that (a) a review of
the activities of the Servicer during the preceding calendar year (or during the
period from the date of execution of this Agreement until the end of the
preceding calendar year in the case of the first such certificate) and of
performance under this Agreement has been made under such officer's supervision;
and (b) to the best of such officer's knowledge, based on such review, the
Servicer has fulfilled all of its obligations under this Agreement throughout
such period, or if there has been a default in the fulfillment of any such
obligation, specifying each such default known to such officer and the nature
and status thereof.
7. Annual Independent Public Accountants' Servicing Report. On or before
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December 31 of each year, beginning December 31, 1998, the Servicer, at its
expense, shall cause a firm of independent public accountants that is a member
of the American Institute of Certified Public Accountants to furnish a statement
to the Company to the effect that such firm has examined certain documents and
records relating to the servicing practices of the Servicer for the preceding
calendar year (or during the period from the date of execution of this Agreement
until the end of the preceding calendar year in the case of the first such
certificate) and that, on the basis of such examination conducted substantially
in compliance with generally accepted auditing standards and the Uniform Single
Attestation Program for Mortgage Bankers or the Audit Program for Mortgages
serviced for FHLMC, such firm is of the opinion that such servicing during such
period has been conducted generally in compliance with this Agreement except for
such exceptions that, in the opinion of such firm, generally accepted auditing
standards and the Uniform Single Attestation Program for Mortgage Bankers or the
Audit Program for Mortgages serviced for FHLMC requires it to report, in which
case such exceptions shall be set forth in such statement.
8. Access to Certain Documentation Regarding the Real Estate Assets.
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Upon reasonable advance notice, the Servicer will provide reasonable access
during its normal business hours at its offices to the Company and/or WRSC, and
with the Company's consent, to a savings and loan association, bank or insurance
company to certain reports and to information and documentation regarding the
Real Estate Assets sufficient to permit the Company, the Office of Thrift
Supervision, the FDIC, the supervisory agents and the examiners of any such
entity to comply with applicable regulations of the Office of Thrift Supervision
or other regulatory authorities with respect to investment in the Real Estate
Assets.
9. Fees and Costs. The Company shall pay the Servicer and the Servicer
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may retain or disburse from any Real Estate Asset proceeds the following
amounts:
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9.1 Reimbursement of Costs. All bona fide amounts paid by the
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Servicer to third parties in connection with this Agreement, including without
limitation, stationery suppliers, related printing costs, fees for recordings
and filings, mailgrams, repossession agency fees, legal fees, travel, insurance
costs, and payments arising out of acts or omissions of third parties (including
persons from which the Real Estate Assets are acquired), and the Servicer's
standard photocopy charges.
9.2 Service Fee. The Servicer shall be entitled to a fee (the
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"Servicer's Service Fee") for servicing Real Estate Assets equal to (a) all
interest and other earnings paid or accrued on amounts from time to time on
deposit in any accounts in which proceeds of Real Estate Assets are deposited
plus (b) a monthly fee equal to an amount negotiated by the parties for each
particular Real Estate Assets portfolio, which monthly fee shall be comparable
to or below fees charged by other industry participants for servicing comparable
loan portfolios.
9.3 Payment. The Servicer may withdraw on a monthly basis from all
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Real Estate Assets proceeds all escrow payments, costs, and the Servicer's
Service Fee. Within twenty-five (25) days after the last day of each calendar
month the Servicer shall pay to the Company or the Affiliate owning the Real
Estate Assets the net proceeds received in that calendar month. The Company or
the applicable Affiliate shall pay the Servicer within fifteen (15) days after
billing for any excess fees and costs. The Servicer shall receive any ancillary
income, other than any float revenue.
10. Independent Contractor. The Servicer shall provide the Services in
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the capacity of an independent contractor. Nothing in this Agreement shall be
construed as establishing an employment, partnership or joint venture between
the Company and the Servicer.
11. Representations of the Company. The Company represents and warrants as
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follows:
11.1 The Company has been duly organized and is validly existing and
in good standing under the laws of the jurisdiction of its organization, with
power and authority to own its properties and to conduct its business as such
properties are currently owned and such business is currently conducted.
11.2 The Company has the power and authority to execute and deliver
this Agreement and to carry out its terms; and the execution, delivery, and
performance of this Agreement have been duly authorized by the Company by all
necessary action on the part of the Company.
11.3 This Agreement constitutes a legal, valid and binding obligation
of the Company enforceable in accordance with its terms, subject to bankruptcy,
insolvency, reorganization, moratorium, or other similar laws affecting
enforcement of creditor rights generally.
12. Representations of the Servicer. The Servicer represents and warrants
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as follows:
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12.1 The Servicer has been duly organized and is validly existing and
in good standing under the laws of the jurisdiction of its organization, with
power and authority to own its properties and to conduct its business as such
properties are currently owned and such business is currently conducted and has
corporate power, authority and legal right to service the Real Estate Assets as
provided in this Agreement.
12.2 The Servicer has the power and authority to execute and deliver
this Agreement and to carry out its terms; and the execution, delivery, and
performance of this Agreement have been duly authorized by the Servicer by all
necessary corporate action on the part of the Servicer.
12.3 This Agreement constitutes a legal, valid and binding obligation
of the Servicer enforceable in accordance with its terms, subject to bankruptcy,
insolvency, reorganization, moratorium, or other similar laws affecting
enforcement of creditor rights generally.
13. Audits and Examinations.
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13.1 The Servicer shall use reasonable efforts to maintain in good
order and condition throughout the term of this Agreement all Real Estate Assets
files and relevant materials that the Servicer has received regarding the Real
Estate Assets.
13.2 The Servicer shall maintain a copy of each Real Estate Assets
file at its office or elsewhere within its control, provided, that at the
Company's request, the Servicer will deliver copies of such Real Estate Assets
to the Company or a designee of the Company. The Servicer shall make available
to the Company or its duly authorized representatives, attorneys or auditors the
Real Estate Assets files and the related accounts, records and computer systems
maintained by the Servicer at such times as the Company shall reasonably
request.
13.3 The Servicer shall permit the Company, and its agents to audit
the books and records of the Servicer applicable to the Real Estate Assets at
the Servicer's business premises during the Servicer's normal business hours
upon reasonable prior notice to the Servicer. The Company shall have direct
access to the Servicer's management information system for the Real Estate
Assets or, if applicable, to any service bureau used by the Servicer for the
Real Estate Assets.
14. Substitute Servicer; Limited Arbitration.
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14.1 If at any time during the term of this Agreement the Servicer
shall breach, or default in the performance of a material obligation of the
Servicer undertaken in this Agreement, the Company and the Servicer shall
consult for such period of time as the Company may determine is reasonable under
the circumstances to determine a mutually acceptable resolution. In the event
the Company and the Servicer fail to agree thereon within such period as the
Company may specify, then the Company may, by written notice to the Servicer and
without
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limitation of any other right or remedy of the Company, require that the
Servicer transfer the Real Estate Assets, and all of the Servicer's servicing
and related rights and obligations in and with respect to the Real Estate
Assets, to a substitute servicer to be designated by the Company. Such
substitute servicer shall thereupon perform, pursuant to a servicing contract
acceptable to the Company, all of the Servicer's duties and obligations under
this Agreement. Upon the Company's designation of such a substitute servicer,
the Servicer shall within a reasonable time and to the extent it holds
possession thereof, deliver to such substitute servicer all written evidence and
documentation of the Real Estate Assets and the Servicer thereafter shall
cooperate and follow all instructions of the Company in all reasonable respects
to facilitate such substitute servicer's performance of the Servicer's duties
and obligations under this Agreement. The fees and expenses of the substitute
servicer shall be paid by the Company. The Servicer, however, shall continue to
be entitled to the Servicer's Service Fee with regard to any Real Estate Assets
being serviced under this section, net of all servicing fees paid by the Company
to the substitute servicer for such Real Estate Assets.
14.2 If the Servicer wishes to contest or dispute the Company's
appointment of a substitute servicer, The Servicer shall so notify the Company
in writing within thirty (30) days after such appointment, specifying in the
notice the Servicer's reasons for doing so. Such controversy or dispute
regarding the Company's appointment of a substitute servicer shall be settled by
arbitration, by one arbitrator in Portland, Oregon in accordance with the Rules
of the American Arbitration Association ("AAA"), subject to the provisions of
Section 9.3 and any other applicable provisions of this Agreement. The
arbitrator, whether appointed by the parties or pursuant to the Rules of the
AAA, shall be impartial and neutral and shall have experience in the management
of operations of an institution which performs financing and collection services
similar to those to be performed by the Servicer under this Agreement. The
decision of the arbitrator shall be final, binding and conclusive upon the
parties. The arbitrator shall comply with the privacy restrictions provided in
Section 14.7 regarding publication of any award.
14.3 In no event shall the arbitrator have power or authority to add
to or detract from the agreements of the parties nor to award punitive or
consequential damages. The arbitrator shall be authorized only to render an
award regarding a dispute or controversy concerning the Company's appointment of
a substitute servicer pursuant to Section 14.1 hereof, including an award of
costs and expenses as herein provided, and the arbitrator shall not purport to
determine, or issue an award regarding, any other legal or equitable rights or
remedies of the parties.
14.4 The arbitration hearing will conclude and the arbitrator's award
shall be rendered in writing within 30 days after it commences. The arbitrator
will make every effort to enforce this requirement strictly, but may extend the
time for the hearing upon a showing that exceptional circumstances require
extension to prevent manifest injustice.
14.5 The parties will share equally the expense of deposits and
advances required by the AAA but either party may advance such amounts, subject
to recovery thereof as an addition or offset to any award. The arbitrator shall
award to the prevailing party, as determined by the
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arbitrator, all costs, fees and expenses related to the arbitration, including
reasonable fees and expenses of attorneys, experts and other professionals
incurred by the prevailing party.
14.6 In the event of any legal action relating to the arbitration,
including any action to stay the arbitration, to vacate, modify or correct any
award or otherwise, the prevailing party in such action as determined by the
court shall be entitled to recover from the other party its court costs and
reasonable fees and expenses of attorneys, experts and other professionals
incurred in connection with the action, including such costs, fees and expenses
upon appeal. The institution and maintenance of an action for judicial relief,
or the pursuit of any provisional, ancillary, or judicial remedy by any party,
shall not constitute a waiver of the right of any party, including the plaintiff
in such judicial action, to submit the controversy or claim to arbitration
pursuant to Section 14.2 hereof.
14.7 The Servicer and the Company acknowledge that the existence,
progress and results of any arbitration held under this Agreement, and any
arbitral award, are to remain private. Each party agrees not to publish or
disclose any information regarding the arbitration or any such award by any
means, except as may be required for enforcement of any arbitral award and
further agrees to take reasonable care, but in no event less care than it takes
to protect its own confidential business information generally, to prevent
disclosure and dissemination of such information.
14.8 The award rendered in any arbitration may be enforced in any
court of competent jurisdiction.
15. General Provisions.
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15.1 Written Notices. Notices under this Agreement must be in writing
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and mailed, U.S. Mail with first class postage prepaid or overnight mail, or
telecopied, to the appropriate address shown above unless the address has been
changed by notice given as provided herein at least three (3) business days in
advance of the effective date of such change. Notice will be effective three
(3) business days after mailing or one business day after telecopy.
Wilshire Credit Corporation
1776 SW Madison Street
Portland, OR 97207
Telephone No.: (503) 223-5600
Telecopy No.: (503) 223-8399
with a copy to: James M. Waddington, Esq.
Proskauer Rose LLP
1585 Broadway
New York, NY 10036-8299
Wilshire Real Estate Investment Trust Inc.
1776 SW Madison Street
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Portland, OR 97207
Telephone No.: (503) 223-5600
Telecopy No.: (503) 223-8399
with a copy to: James M. Waddington, Esq.
Proskauer Rose LLP
1585 Broadway
New York, NY 10036-8299
Wilshire Realty Services Corp.
1776 SW Madison Street
Portland, OR 97207
Telephone No.: (503) 223-5600
Telecopy No.: (503) 223-8399
with a copy to: James M. Waddington, Esq.
Proskauer Rose LLP
1585 Broadway
New York, NY 10036-8299
15.2 Attorneys' Fees. If any judicial proceeding is initiated by
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either of the parties arising out of the subject matter of this Agreement,
including without limitation any suit or action arising under state or federal
securities laws, trial, appeal, or bankruptcy, the prevailing party in such
proceeding will be entitled to recover, in addition to any judgment obtained in
such proceeding, reasonable attorneys' fees and court costs incurred.
15.3 Events Beyond the Control of the Parties. Performance by either
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party hereunder will not be deemed to be in default where the delay or default
is due to events beyond its reasonable control, including without limitation
war, insurrection, strike, lock-outs, riots, floods, earthquakes, fires,
casualties, acts of God, epidemics, quarantine restrictions, governmental
restrictions, inability to secure necessary labor or materials, acts of the
other party or failure to act of any public or governmental agency or entity.
15.4 Further Assurances. Following the execution of this Agreement,
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the Servicer and the Company, respectively, shall, from time to time at the
request of the other, execute and deliver such other documents and instruments,
and shall take such other actions, as may be reasonably necessary or appropriate
to carry out and perform more effectively the terms and purposes of this
Agreement.
15.5 Governing Law. This Agreement will be governed by the laws of
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the state of Oregon. Any dispute arising from or in connection with this
Agreement, other than as provided in Section 9, shall be resolved in the
applicable state or federal court in Portland, Oregon.
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15.6 Severability. If any provision herein is deemed unenforceable in
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whole or in part, such provision shall be deemed severable solely to the extent
of such enforceability without impacting the remainder of this Agreement.
15.7 Counterparts. This Agreement may be executed in one or more
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counterparts. Each signed counterpart shall be deemed an original, but all of
them together constitute one and the same instrument.
15.8 Entire Agreement. This Agreement constitutes the entire
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agreement between the parties as to its subject matter and supersedes all
proposals, oral or written, and all negotiations, conversations or discussions
heretofore had between the parties related to the subject matter of this
Agreement. Any amendment to this Agreement must be in writing signed by the
party to be charged.
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IN WITNESS WHEREOF, this agreement has been duly signed by the Servicer and
on behalf of the Company on the day and year first above written.
Wilshire Credit Corporation
By:_______________________________________
Its:______________________________________
Wilshire Real Estate Investment Trust Inc.
By:_______________________________________
Its:______________________________________
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