2.15 List of Mirador Agreements
(Contracts, Agreements and Appointments)
Regional Office 210 Franklin Road SW
Roanoke VA 24011
[Graphic DEPARTMENT OF
Omitted] VETERANS AFFAIRS
June 14, 1990
In Reply Refer To:
United Mortgagee, Inc. 314-264
2910 West Clay Street, Suite 205
Richmond, VA 23230
Gentlemen:
We welcome you to our area and recognize your firm to process VA loan
applications. We look forward to future associations with you and we will
afford you every assistance possible.
Your VA identification number is 68528100001.
This regional office serves the State of Virginia, except for certain
northern Virginia cities and counties which are under the jurisdiction of
the VA Regional Office, Washington, D.C. (See list enclosed.)
You are now on our mailing list to receive current publications. Please
inform us of any change in your address.
The enclosed VA poster 26-77-2 must be displayed in your office in an area
accessible to the public.
Please refer to the enclosed information for ordering forms and incoming
mail routing.
Sincerely yours,
/s/ S. H. JACOBS
------------------------------
S.H. JACOBS
Chief, Loan Processing Section
Enclosure
264/165/03198 SHJ:shj
U.S. Department of Housing and Urban Development
[Graphic Omitted]
Virginia State Office
Office of Housing
The 3600 Centre
3800 W. Broad Street, Suite 300
Richmond, VA 23230-4920
October 30, 1997
Mr. Leo Thomas, Jr.
President
United Mortgagee, Inc.
3500 Virginia Beach Blvd. Suite 211
Virginia Beach, VA 23452
Dear Mr. Thomas:
SUBJECT: Direct Endorsement Approval
United Mortgagee, Inc., ID# 7316-00003
We have reviewed the qualifications of your organization and have determined
that the Direct Endorsement mortgagee eligibility requirements have been met.
Accordingly, the office noted above is approved to submit mortgages in the
Direct Endorsement Program on the pre-closing review status to HUD's
Philadelphia Homeownership Center. The address to the Homeownership Center is
HUD Homeownership Center
The Wannmaker Building
100 Penn Square East
Philadelphia, PA 19107-3389
During the pre-closing review period, HUD will perform a complete technical
review of each submission. If found to be eligible, a firm commitment will be
issued. This pre-closing review will include at least 15 submissions. Should
these 15 submissions fail to demonstrate acceptable underwriting, the
pre-closing review status will be extended. We will notify you when the
pre-closing review period has been successfully completed.
HUD's receipt and review of the Quality Control Plan are solely for the purpose
of determining whether the Plan addresses the Direct Endorsement Program
requirements. HUD's review is not for the purpose of approving the adequacy of
any other provisions. Please be advised that participation in the Direct
Endorsement Program is a privilege accorded only to those mortgages who have
demonstrated the ability to originate mortgage loans in accordance with IIUD's
underwriting policies. Therefore, should the mortgage loans submitted for Direct
Endorsement indicate unsatisfactory underwriting, the privilege will be reduced
or withdrawn.
WAREHOUSE LOAN AND SECURITY AGREEMENT
This Warehouse Loan and Security Agreement ("Agreement") is made and
entered into on this 28th day of APRIL 2000 between MIRADOR DIVERSIFIED
SERVICES, INC., a NEVADA with its principal place of business located at 675
Lynnhaven Partway, 2nd Floor, Virginia Beach, VA 23452 ("Borrower"), and The
Provident Bank, an Ohio banking corporation with its principal place of business
located at One East Fourth Street, Cincinnati, Ohio 45202 ("Provident").
W I T N E S S E T H:
WHEREAS, Borrower is engaged in the business of underwriting,
processing, originating, closing, funding, purchasing, servicing and selling
mortgage loans secured by first or second liens evidenced by mortgages on real
property; and
WHEREAS, Borrower has requested and Provident has agreed to finance the
funding of mortgage loans by Borrower in connection with its origination thereof
subject to the terms, conditions and limitations set forth in this Agreement.
NOW THEREFORE, in consideration of the premises, the extension of
credit by Provident to Borrower, and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, Provident and Borrower
agree as follows:
1. DEFINITIONS. (a) When used in this Agreement, the following
terms shall have the following meanings and the terms defined elsewhere in this
Agreement shall have the meanings assigned to them (such meanings to be equally
applicable to both the singular and plural forms of the terms defined):
"ADVANCE" shall mean any amount loaned by Provident to
Borrower under this Agreement.
"AFFILIATE" shall mean, in relation to any Person (in this
definition called "Affiliated Person"), any Person (i) which (directly or
indirectly) controls or is controlled by or is under common control with such
Affiliated Person; or (ii) which (directly or indirectly) owns or holds five
percent (5%) or more of any equity interest in Borrower; or (iii) five percent
(5%) or more of whose voting stock or other equity interest is directly or
indirectly owned or held by Borrower. For the purposes of this definition, the
term "control" (including, with correlative meanings, the terms "controlled by"
and "under common control with"), as used with respect to any Person, shall mean
the possession (directly or indirectly) of the power to direct or to cause the
direction of the management or the policies of such Person, whether through the
ownership of shares of any class in the capital or any other voting securities
of such Person or by contract or otherwise.
"ASSIGNMENT OF MORTGAGE" shall mean, with respect to any
Mortgage, an assignment of the Mortgage, notice of transfer or equivalent
instrument, in recordable form, sufficient under the laws of the jurisdiction in
which the related Mortgaged Property is located to reflect the assignment of the
Mortgage.
"BUSINESS DAY" shall mean a day other than Saturdays, Sundays,
holidays or other days on which the main office of Provident is not open for
business.
"CASH COLLATERAL ACCOUNT" shall mean the demand deposit
account comprising a portion of the Collateral and established and maintained by
Borrower with Provident pursuant to Section 5(d).
"CHANGE OF CONTROL" shall mean the time at which (i) any
Person (including a Person's Affiliates and associates) or group (as that term
is understood under Section 13(d) of the Securities Exchange Act of 1934 and the
rules and regulations thereunder), other than Management Shareholders and
Affiliates thereof (the "Control Group") or a group controlled by the Control
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Group, has become the beneficial owner of a percentage (based on voting power,
in the event different classes of stock shall have different voting powers) of
the voting stock of Borrower equal to at least ten percent (10%), (ii) there
shall be consummated any consolidation or merger of Borrower pursuant to which
Borrower's common stock (or other capital stock) would be converted into cash,
securities or other property, other than a merger or consolidation of Borrower
in which the holders of such common stock (or such other capital stock)
immediately prior to the merger have the same proportionate ownership, directly
or indirectly, of common stock of the surviving corporation immediately after
the merger as they had of Borrower's common stock immediately prior to such
merger, or (iii) all or substantially all of Borrower's assets shall be sold,
leased, conveyed or otherwise disposed of as an entirety or substantially as an
entirety to any Person (including an Affiliate or associate of Borrower) in one
or a series of transactions.
"CLOSING DATE" shall mean the date on which Borrower sells,
transfers or otherwise disposes of a Mortgage Loan funded and originated by
Borrower with an Advance made by Provident to Borrower under this Agreement.
"COLLATERAL" shall have the meaning set forth in Section 5(?).
"COLLECTIONS" shall mean, collectively, all Sale Proceeds, all
Payment Collections and all other collections and Proceeds on or in respect of
the Mortgage Loans.
"COST AND FEE SCHEDULE" shall have the meaning set forth in
Section 2(f).
"CREDIT FILE" shall mean, as to each Mortgage Loan, a copy of
the Mortgage and copies of all intervening assignments of mortgage, if any, with
evidence of recording thereon, showing a complete chain of title from the
originator to Borrower; the original attorney's opinion of title or the original
policy of title insurance, if not previously delivered to Provident; the
originals of all assumption, modification and extension agreements, if any; and
all applications, credit reports, salary or employment verifications,
appraisals, surveys, other underwriting and work papers, closing statements,
HUD-1 settlement statements and any addendums thereto, truth-in-lending
disclosures, right of recission notices, payment histories, and all other
closing documents and all other agreements, reports, certificates, documents and
instruments related thereto or obtained or prepared in connection therewith and
included or includable in Borrower's mortgage file relating to such Mortgage
Loan.
"DEFAULT INTEREST RATE" shall mean an annual rate of interest
which shall (to the extent permitted by applicable law) at all times be equal to
four percent (4%) above the Interest Rate.
"DEMAND FOR PAYMENT" shall have the meaning set forth in
Section 4(a).
"DOCUMENT CUSTODIAN" shall mean Borrower, as custodian and
bailee for Provident, or any successor appointed by Provident at any time.
"FEES" shall have the meaning set forth in Section 2(f).
"FUNDING DATE" shall mean the date on which an Advance is made
by Provident to Borrower under this Agreement.
"INITIAL COLLATERAL PACKAGE" shall mean, as to each Mortgage
Loan: (i) the original Mortgage Note and the originals of all intervening
endorsements, if any, showing a complete chain of title from the originator of
the Mortgage Loan to Borrower, endorsed in blank (either on the Mortgage Note or
a separate allonge attached thereto); (ii) a certified copy of the original
Mortgage and copies of all intervening assignments of the Mortgage, if any;
(iii) the original Assignment of Mortgage in favor of Provident in recordable
form for the jurisdiction in which the Mortgaged Property is located; and (iv)
the original attorney's opinion of title or the original policy of title
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insurance (or if such original policy of title insurance has not yet been
received by Borrower, a copy of such policy or a title insurance binder or
commitment for the issuance of such policy).
"INTEREST RATE" shall mean an annual rate of interest which
shall (to the extent permitted by applicable law) at all times be equal to the
Prime Rate plus the applicable margin determined by reference to the factors
applicable to such determination set forth in the Cost and Fee Schedule in
effect on an Interest Payment Date or Closing Date, as the case may be.
"LIEN" shall mean any lien, mortgage, pledge, security
interest, charge or other encumbrance of any kind including any conditional sale
or other title retention agreement, any lease in the nature thereof, and any
agreement to give any security interest.
"LOAN DOCUMENTS" shall mean this Agreement, the Security
Documents, the Policies and Procedures, the Cost and Fee Schedule and any other
instrument, certificate or document executed in connection with or pursuant to
this Agreement whether concurrently herewith or subsequent hereto.
"LOSSES" shall have the meaning set forth in Section 11(b).
"MANAGEMENT SHAREHOLDERS" shall mean those shareholders of
Borrowers who are senior executive officers of Borrower on the date of this
Agreement.
"MATURITY DATE" shall have the meaning set forth in Section
4(b).
"MORTGAGE" shall mean the mortgage, deed of trust or other
instrument creating a first or second Lien on an estate in fee simple interest
in the Mortgaged Property securing a Mortgage Loan.
"MORTGAGE LOAN" shall mean any mortgage loan funded and
originated by Borrower with any Advance made by Provident to Borrower under this
Agreement.
"MORTGAGE LOAN DOCUMENTS" shall mean, with respect to a
Mortgage Loan, the documents comprising the Initial Collateral Package and the
Credit File for such Mortgage Loan.
"MORTGAGE NOTE" shall mean, with respect to a Mortgage Loan,
the original note or other evidence of indebtedness pursuant to which the
related Mortgagor agrees to pay the indebtedness evidenced thereby and which is
secured by the related Mortgage.
"MORTGAGED PROPERTY" shall mean the underlying real property,
including all improvements and additions thereon, securing a Mortgage Loan.
"MORTGAGOR" shall mean the obligor or obligors under a
Mortgage Note.
"OTHER OBLIGATIONS SECURED HEREBY" shall mean all of
Borrower's debts, obligations or liabilities of every kind, nature, class and
description to Provident (other than those under this Agreement and the other
Loan Documents), now due or to become due, direct or indirect, absolute or
contingent, presently existing or hereafter arising, joint or several, secured
or unsecured, purchase money or non-purchase money, related or unrelated,
similar or dissimilar, whether for payment or performance, regardless of how the
same arise or by what instrument, agreement or book account they may be
evidenced, or whether evidenced by any instrument, agreement or book account,
including without limitation, all loans (including any loan by renewal or
extension), and all overdrafts, all guarantees, all bankers acceptances, all
agreements, all letters of credit issued by Provident for Borrower and the
applications relating thereto, all indebtedness of Borrower to Provident, all
undertakings to take or refrain from taking any action, and all indebtedness,
liabilities and obligations owing from Borrower to others which Provident may
obtain by purchase, negotiation, discount, assignment or otherwise.
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"PAYMENT COLLECTIONS" shall mean, collectively, all
collections on the Mortgage Loans attributed to the payment of the principal
amount thereof, accrued interest thereon or any fees, charges or other amounts
payable thereunder or in respect thereof.
"PERSON" shall mean an individual, a company, a limited
liability company, a corporation, an association, a partnership, a joint
venture, an unincorporated trade or business enterprise, a trust, an estate, or
other legal entity or a government (national, regional or local), court,
arbitrator or any agency, instrumentality or official of the foregoing.
"PRIME RATE" shall mean the rate of interest published from
time to time in the "Money Rates" column of THE WALL STREET JOURNAL (Central
Edition) as the "prime rate" or, if such rate ceases to be so published, then
such other rate as may be substituted by Provident as the prime rate, which may
be the rate of interest announced by Provident from time to time as its prime
rate. The Prime Rate shall change on each date the prime rate so published
changes.
"POLICIES AND PROCEDURES" shall mean Provident's Policies and
Procedures for its Warehouse Division as of the date of this Agreement, as
amended, modified, restated or supplemented by Provident from time to time.
"SALE PROCEEDS" shall mean (i) any proceeds received or
receivable by Borrower with respect to or in respect of any sale, transfer or
other disposition of any Mortgage Loan and (ii) any proceeds received or
receivable by Borrower with respect to or in respect of any sale, transfer,
disposition, condemnation or casualty event and all other amounts from any
disposition, taking, damage or destruction of any Mortgaged Property acquired by
Borrower upon foreclosure (or deed in lieu of foreclosure) of any Mortgage Loan.
"SECURITY DOCUMENTS" shall have the meaning set forth in
Section 5(b).
"THIRD PARTY INVESTOR" shall mean any Person with whom
Borrower has contracted to sell any Mortgage Loan that has been funded and
originated by Borrower with any Advance made by Provident to Borrower under this
Agreement. Provident may itself be a Third Party Investor.
"UCC" shall mean the Uniform Commercial Code as the same may,
from time to time, be in effect in the State of Ohio; PROVIDED, HOWEVER, that in
the event that by reason of mandatory provisions of law, any or all of the
attachment, perfection, or priority of Provident's security interest in any of
the Collateral is governed by the Uniform Commercial Code as in effect in a
jurisdiction other than the State of Ohio, the term "UCC" shall mean the Uniform
Commercial Code as in effect in such other jurisdiction for purposes of the
provisions hereof relating to such attachment, perfection, or priority and for
purposes of definitions related to such provisions.
(b) All terms defined in the UCC and used in Section 5 of this
Agreement shall have the meanings assigned to such terms in the UCC.
(c) Where appropriate, words importing the singular only shall
include the plural and vice versa.
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2. ADVANCES.
(a) Subject to the terms and conditions hereof and the
Policies and Procedures, which are hereby incorporated herein by this reference,
Provident may elect, in its sole discretion, to make Advances to Borrower from
time to time in such amounts as Borrower may request. Nothing herein shall be
deemed or construed as a commitment by Provident to make any Advance hereunder
and it is expressly acknowledged and agreed by Borrower that the decision to
make any Advance hereunder is, and shall at all times be, wholly discretionary
on the part of Provident.
(b) In order to obtain Advances, Borrower shall comply with
the requirements set forth in this Agreement and the Policies and Procedures and
shall furnish Provident with such requests and all other documents Provident may
request or require at any time in connection with any Advance. In addition, the
following conditions precedent, unless waived in whole or in part by Provident,
shall be satisfied before Provident makes any Advance hereunder: (i) Provident,
in its sole discretion, shall have approved the underwriting of the Mortgage
Loans to be funded with any Advance; (ii) Borrower shall have provided Provident
with an insured closing letter, evidence of a current errors and omissions
insurance policy with limits of at least $1,000,000, an executed closing agent
agreement and wiring instructions for each closing agent used by Borrower to
close the Mortgage Loans funded with any Advance, each of which shall be
acceptable to Provident in its sole discretion; (iii) Borrower shall have
furnished Provident with an executed, recordable Power of Attorney covering the
items set forth in Section 5(e) hereof for each state in which Borrower does
business; and (iv) Provident, or its agent, bailee or designee, shall have
received the Initial Collateral Package for each of the Mortgage Loans funded
with any Advance. Each request for an Advance by Borrower shall constitute a
certification that each of the representations and warranties made by Borrower
to Provident in this Agreement or the other Loan Document shall be true and
correct in all material respects on and as of the date when made and shall, for
all purposes of this Agreement, be deemed to be repeated on and as of each date
an Advance is made by Provident to Borrower hereunder and shall be true and
correct in all material respects on and as of each of such date, except as
affected by the consummation of the transactions contemplated by this Agreement
and the other Loan Documents, and Borrower shall have performed, complied with
and observed all of its covenants and agreements contained in this Agreement and
the other Loan Documents on and as of each date an Advance is made by Provident
to Borrower hereunder.
(c) Advances hereunder will be made by Provident on behalf of
Borrower to third parties in connection with the funding of the Mortgage Loans
originated by Borrower. All matters relating to the funding of any Mortgage Loan
hereunder shall be acceptable to Provident in its sole discretion.
(d) Borrower represents, warrants and covenants to Provident
that all proceeds of all Advances shall be used by it solely to fund Mortgage
Loans originated by Borrower in the ordinary course of its business and for no
other use or purpose.
(e) Advances for the funding of any Mortgage Loan originated
by Borrower shall not exceed one hundred percent (100%) of the original
principal amount of such Mortgage Loan.
(f) In connection with each Advance, Borrower agrees to pay
Provident the transaction fees charged by Provident with respect to the Mortgage
Loans funded and originated with such Advance ("Fees"). The amounts of Fees
payable by Borrower in connection with any Advance shall be determined by
reference to the Cost and Fee Schedule in effect on the Funding Date of such
Advance (the "Cost and Fee Schedule"). The Cost and Fee Schedule in effect on
the date of this Agreement is attached hereto as Schedule A. Any Cost and Fee
Schedule shall remain in effect until a new Cost and Fee Schedule is delivered
to Borrower in accordance with the requirements of Section 11(f).
3. INTEREST PAYABLE ON ADVANCES. Borrower promises to pay to
Provident interest in arrears on the unpaid amount of each Advance made by
Provident to Borrower pursuant to this Agreement and on the unpaid amount of any
interest not paid when due at a variable rate of interest per annum equal at all
times to the Interest Rate. Interest shall be calculated on the daily unpaid
amount of each Advance from its Funding Date. Interest with respect to each
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Advance hereunder shall be payable: (i) commencing on the date that is sixty-one
(61) days after the Funding Date of the Advance and continuing on the same day
of each consecutive month thereafter; and (ii) on its Maturity Date. Payments of
interest shall be due and payable as set forth above until payment in full of
all Advances. All interest under this Agreement shall be calculated on the basis
of a year consisting of 360 days (comprised of twelve 30 day months) and paid
for actual days elapsed.
4. TERMINATION: MANDATORY REPAYMENTS OF ADVANCES PRIOR TO
TERMINATION
(a) Provident may, at any time, for any reason and without
prior notice, terminate this Agreement and demand that Borrower pay the
aggregate unpaid amount of all Advances made by Provident to Borrower pursuant
to this Agreement, all accrued and unpaid interest thereon as well as all Fees,
charges and other amounts payable hereunder and under the Loan Documents
("Demand For Payment").
Following a Demand for Payment, the aggregate unpaid
amount of all Advances made by Provident to Borrower pursuant to this Agreement,
together with all accrued and unpaid interest thereon as well as all Fees,
charges and other amounts payable hereunder and under the other Loan Documents
shall be immediately due and payable in full and no future or additional
Advances will be made by Provident to Borrower hereunder.
(b) Prior to termination of this Agreement as provided for
above, Borrower shall repay to Provident the unpaid amount of each Advance made
by Provident to Borrower hereunder, all accrued and unpaid interest thereon and
all Fees, charges and other amounts payable hereunder, on the earlier to occur
of: (i) the Closing Date on which Borrower sells or otherwise disposes of the
Mortgage Loan(s) funded and originated with the Advance whether by sale to a
Third Party Investor or otherwise; or (ii) on or before the applicable number of
days after its Funding Date set forth in the Cost and Fee Schedule under the
heading entitled "Days Allowed for Purchase by Third Party Investor" (the
earlier to occur of (i) or (ii) being referred to herein as the "Maturity
Date").
5. GRANT OF SECURITY INTEREST.
(a) To secure the prompt payment of the Advances, interest and
all other amounts payable hereunder and under the other Loan Documents and the
due and punctual performance and observance by Borrower of all of its other
covenants, obligations and liabilities under this Agreement and the other Loan
Documents and also to secure all of the Other Obligations Secured Hereby,
Borrower hereby grants to Provident a security interest in an to, and hereby
pledges and collaterally assigns to Provident, all of its rights, title,
interest and claims in, to and under all of the following property, wherever
located, whether now or hereafter owned, held or acquired, or hereafter existing
or arising (collectively, the "Collateral"):
(i) all Mortgage Loans;
(ii) all Mortgage Loan Documents including, without
limitation, all Mortgage Notes, Mortgages and Assignments of Mortgages
relating to the Mortgage Loans;
(iii) all rights to service or subservice the Mortgage
Loans;
(iv) all certificates, notes and other securities of any
kind whatsoever, residual or otherwise, issued to Borrower or now or
hereafter owned, held or acquired by Borrower in connection with or
related to any mortgage loan securitization or any asset-back
transaction involving the Mortgage Loans;
(v) all of Borrower's rights under contracts or
agreements to which Borrower is party (but none of its covenants,
obligations or liabilities thereunder) in connection with the Mortgage
Loans, including all contract or agreements with all Third Party
Investors and all attorney's opinions of title and title insurance
policies;
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(vi) the Cash Collateral Account and all funds in the
Cash Collateral Account; and
(vii) all Proceeds of any and all of the foregoing
Collateral in whatever form, including but not limited to, all payments
made by Mortgagors to Borrowers in connection with the Mortgage Loans
and all premiums paid to Borrower by Third Party Investors in
connection with the sales of the Mortgage Loans.
(b) Borrower shall take all actions necessary or appropriate
under all applicable laws, or as requested by Provident, to perfect, maintain
and preserve, and to continue as perfected, Provident's first lien and
security interest in the Collateral. Borrower shall pay all costs of
preparing, recording and filing UCC Financing Statements (and any continuation
or termination statements with respect thereto) and any other documents,
titles, statements, assignments or the like reasonably required to create,
maintain, preserve or perfect the liens or security interests granted under
the Loan Documents, together with costs and expenses of any lien or UCC
searches required by Provident in connection with the making of any Advance.
At Provident's request, Borrower shall execute and deliver to Provident at any
time and from time to time hereafter, all supplemental documentation that
Provident may reasonably request to perfect, maintain, preserve or continue
the security interest and liens in the Collateral granted Provident hereby and
under any of the other Loan Documents (collectively, the "Security
Documents"), in form and substance acceptable to Lender, and pay the costs of
preparing and recording or filing of the same. Borrower agrees that a carbon,
photographic, or other reproduction of this Agreement or of a financing
statement is sufficient as a financing statement. Borrower shall promptly
notify Provident concerning any changes in its name, identity or structure,
concerning any changes in the address(es) of its chief executive office or
other places of business or concerning any changes in its trade name(s) or
name(s) under which it does business.
(c) The Document Custodian shall maintain possession of each
Credit File and the Mortgage Loan Documents comprising each Credit File (other
than the Initial Collateral Package) for each Mortgage Loan. Promptly after
Provident's request therefor, Borrower, at its expense, shall cause the
Credit Files held by the Document Custodian to be delivered to Provident or
its agent, bailee or other designee.
(d) Borrower shall, at all times, maintain the Cash Collateral
Account with Provident. Borrower shall deposit or cause to be deposited all
Collections into the Cash Collateral Account when and as Collections are
received or receivable by Borrower. Withdrawals may be made from the Cash
Collateral Account by Borrower in accordance with the Policies and Procedures.
Provident is hereby authorized to withdraw funds from the Cash Collateral
Account from time to time, either before or after Provident's Demand for
Payment, and to apply such withdrawals to the payment of the Advances, accrued
and unpaid interest thereon and Fees, charges and other amounts payable
hereunder or under the other Loan Documents.
(e) Borrower hereby makes, constitutes and appoints Provident
(by any of its officers, employees or agents), its true and lawful agent and
attorney-in-fact and hereby gives and grants to Provident full power and
authority to do and perform each and every act whatsoever requisite, necessary
and proper (i) to endorse the related Mortgage Note to the Third Party
Investor that purchases any Mortgage Loan; (ii) to endorse any original
Mortgage Note to Provident or the purchaser thereof should Borrower default in
its obligations hereunder; (iii) to prepare, execute and record on behalf of
Borrower any Assignment of Mortgage; (iv) at the sole option of Provident, to
prosecute, in Borrower's or Provident's name, any and all claims or causes of
action collaterally assigned to Provident hereunder; and (v) to do and perform
every act necessary to place Provident in position to enforce the payment of
any Mortgage Loan.
6. BORROWER'S REPRESENTATIONS AND WARRANTIES. Borrower represents
and warrants to Provident as follows as of the date hereof and as of each
Funding Date:
(a) Borrower is and shall at all times be, duly organized,
validly existing and in good standing under the laws of the State set forth in
the first paragraph of this Agreement and has, and shall at all times have, full
power and authority and legal right to engage in and carry on Borrower's
business as now being conducted, to undertake the borrowings contemplated hereby
and to execute and deliver each of the Loan Documents. Borrower is qualified
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and licensed in each jurisdiction wherein the nature or conduct of its business
make such qualification necessary or advisable. Borrower is currently qualified
and licensed in good standing in each such jurisdiction. Borrower's name as set
forth in the caption of this Agreement and as set forth on the signature page of
this Agreement is Borrower's correct individual, partnership or corporate name,
as the case may be.
(b) Borrower has full power and authority and legal right to
enter into this Agreement and each of the other Loan Documents, and to perform,
observe and comply with all of its agreements and obligations under each of such
documents, including without limitation, the making by Borrower of the
borrowings contemplated hereby and the granting by Borrower of the security
interest in the Collateral pursuant to Section 5.
(c) The execution and delivery by Borrower of this Agreement
and the other Loan Documents, the performance by Borrower of all of its
agreements and obligations hereunder and thereunder and the making by Borrower
of the borrowings contemplated by this Agreement have been duly authorized by
all necessary corporate action on the part of Borrower and do not and will not
constitute a breach, violation or event of default (or an event which would
become an event of default with the lapse of time or notice or both) under any
judgment, decree, note, agreement, indenture or other instrument to which
Borrower is a party or otherwise subject.
(d) Borrower owns or possesses all rights, licenses, permits,
franchises and the like necessary for the conduct of its business as presently
conducted and proposed to be conducted. All of the foregoing rights, licenses,
permits and franchises are in full force and effect, and Borrower is in
compliance with all of the foregoing. No event has occurred which permits, or
after notice or lapse of time or both would permit the revocation or termination
of any such right, license, permit or franchise, or affects the rights of
Borrower thereunder.
(e) The balance sheets, statements of income and other
financial statements previously delivered to Provident present fairly the
financial condition and results of operations of Borrower as of the dates
thereof and for the fiscal periods then ended. There are no material liabilities
or obligations, secured and unsecured (whether accrued, absolute or actual,
contingent or otherwise), which were not reflected in the balance sheets of
Borrower as of the dates thereof.
(f) No changes have occurred in the assets, liabilities or
financial condition of Borrower from those reflected on the most recent balance
sheet delivered to Provident (the "Current Balance Sheet") which, individually
or in the aggregate, have been adverse. Since the date of the Current Balance
Sheet, there has been no adverse development in the business or in the
operations or prospects of Borrower.
(g) Borrower is the sole owner of and has good and marketable
title to the Collateral, free and clear of all Liens and encumbrances
whatsoever, except for the security interest granted by Borrower pursuant to
Section 5. All information furnished to Provident concerning the Collateral is
and will be complete, accurate and correct in all respects when furnished.
7. COVENANTS REGARDING THE BORROWER. Borrower covenants and
agrees with Provident as follows:
(a) Borrower shall deliver to Provident as soon as available
and, in any event, within thirty (30) days after the end of each calendar
quarter, quarterly unaudited financial statements of Borrower and within
seventy-five (75) days after the end of each fiscal year of Borrower, annual
financial statements of Borrower which, in each case, shall include a balance
sheet, statement of income, statement of changes in financial position and notes
to financial statements. Provident reserves the right to require Borrower to
deliver audited annual financial statements.
-9-
Such financial statements shall be certified by the chief
executive officer of Borrower to the effect that such financial statements
reflect, in his opinion and in the opinion of senior management of Borrower, all
adjustments necessary to present fairly the financial position of Borrower as at
the end of such quarter or year, as the case may be, and the results of its
operations for the period then ended.
(b) Borrower shall deliver to Provident all information
Provident may reasonably request at any time and from time to time concerning
its business, financial condition, results of operations, the Mortgage Loans
financed hereunder or the other Collateral.
(c) Borrower covenants to keep the Credit File for each of the
Mortgage Loans financed hereunder at all times at Borrower's business premises
or at such other location or locations as Provident may approve in writing.
Borrower further covenants to deliver the Credit File(s) to Provident upon
demand by Provident, which demand may be made in Provident's sole and absolute
discretion.
(d) Borrower shall pay or cause to be paid all taxes,
assessments and other governmental charges imposed upon its properties or assets
or in respect of any of its franchises, business, income or profits before any
penalty or interest accrues thereon, and all claims (including, without
limitation, claims for labor, services, materials and supplies) for sums which
have become due and payable and which by law have or might become due and
payable and which by law have or might become a lien or charge upon any of its
properties or assets, provided that (unless any material item of property would
be lost, forfeited or materially damaged as a result thereof) no such charge or
claim need be paid if the amount, applicability or validity thereof is currently
being contested in good faith and if such reserve or other appropriate
provision, if any, as shall be required by generally accepted accounting
principles shall have been made therefor.
(e) At any time or times during Borrower's usual business
hours, Borrower shall permit Provident (by any of its officers, employees or
agents) to enter upon Borrower's business premises for any of the following
reasons: (i) to inspect the Collateral and any books or records related thereto
(including making copies of and extracts therefrom), (ii) to verify the amount,
quality, quantity, value or condition of, or any other matter relating to, the
Collateral, (iii) to examine all of the other books and records of Borrower
(including making copies of and extracts therefrom), including those relating to
its tax records, payroll records and insurance records, and (iv) to discuss the
business, financial condition or results of operations with any of Borrower's
officers, employees, agents or accountants. Borrower covenants to pay Provident
a reasonable audit fee and reimburse Provident for its out-of-pocket expenses
for all inspections, audits and examinations conducted by Provident other than
regular monthly audits.
(f) Borrower covenants to comply with all federal, state and
local laws, rules, regulations and orders applicable to it and its business.
(g) Borrower agrees to notify Provident in writing within
fifteen (15) calendar days of any proposed Change of Control or any proposed, or
completed, change in the executive management of Borrower, including, but not
limited to, any management change in the office of president, or any change in
the management of Borrower's underwriting department. Borrower further agrees to
notify Provident in writing at least thirty (30) days in advance of any change
in the location of its principal place of business or of any proposed change in
the name of Borrower or the opening or closing of any office.
(h) Borrower shall not at any time create, assume, incur or
permit to exist, any Lien or other encumbrance in respect of any of the
Collateral.
(i) Borrower agrees to give Provident prompt notice of any
development, financial or otherwise, which would materially adversely affect its
business, properties or affairs or the ability of Borrower to perform its
obligations under this Agreement.
-10-
8. COVENANTS REGARDING THE MORTGAGE LOANS: Borrower further
covenants and agrees with Provident as follows with respect to each Mortgage
Loan to be financed by Provident hereunder.
(a) As of its Funding Date, the Initial Collateral Package and
Credit File relating to the Mortgage Loan shall contain each of the documents
and instruments specified herein to be included therein.
(b) The related Mortgage shall be a valid and enforceable
first or second Lien of record on the Mortgaged Property subject, in the case of
any second Mortgage Loan, only to a first Lien on such Mortgaged Property and
subject in all cases to the exceptions to title set forth in the title insurance
policy or attorney's opinion of title with respect to the related Mortgage Loan,
which exceptions shall be acceptable to Provident.
(c) Borrower shall hold good, marketable and indefeasible
title to, and be the sole owner and holder of, the Mortgage Loan subject to no
Liens or rights of others.
(d) The Mortgage Loan shall not be subject to any right of
rescission, set-off, counterclaim or defense, including the defense of usury,
nor shall the operation of any of the terms of the Mortgage Note or Mortgage, or
the exercise of any right thereunder, render either the Mortgage Note or the
Mortgage unenforceable in whole or in part, or subject to any right of
rescission, set-off, counterclaim or defense, including the defense of usury,
and no such right of rescission, set-off, counterclaim or defense shall have
been asserted with respect thereto.
(e) The Mortgage Loan shall comply with, and shall at all
times be serviced in compliance with, in all material respects, applicable state
and federal laws and regulations, including, without limitation, usury, equal
credit opportunity, consumer credit, truth-in-lending and disclosure laws.
(f) With respect to the Mortgage Loan, either (i) a lender's
title insurance policy, issued in standard American Land Title Association or
California Land Title Association form, or other form acceptable in the
particular jurisdiction, by a title insurance company authorized to transact
business in the state in which the related Mortgaged Property is situated,
together with a condominium endorsement, if applicable, in an amount at least
equal to the original principal balance of such Mortgage Loan insuring the
mortgagee's interest under the related Mortgage Loan as the holder of a valid
first or second mortgage Lien of record on the Mortgaged Property described in
the Mortgage, subject only to the exceptions of the character referred to in
subsection (b) above, shall be valid and in full force and effect on the Funding
date of the origination of such Mortgage Loan or (ii) an attorney's opinion of
title shall be prepared in connection with the origination of such Mortgage
Loan. Such mortgage title insurance policy or attorney's opinion of title shall
be issued in favor of Borrower and its successors and assigns. Borrower shall,
by act or omission, not have done anything that would impair the coverage of
such mortgage title insurance policy or attorney's opinion of title.
(g) The Mortgage Note and the related Mortgage shall have been
duly and properly executed, constitute the legal, valid and binding obligation
of the related Mortgagor and shall be enforceable in accordance with their
respective terms, except only as such enforcement may be limited by bankruptcy,
insolvency, reorganization, moratorium or other similar laws affecting the
enforcement of creditors' rights generally and by general principles of equity
(whether considered in a proceeding or action in equity or at law), and all
parties to the Mortgage Loan shall have had full legal capacity to execute all
Mortgage Loan Documents and to convey the estate therein purported to be
conveyed.
(h) The terms of the Mortgage Note and the Mortgage shall not
have been or be impaired, altered or modified in any material respect, except by
a written instrument which shall have been recorded or is in the process of
being recorded, if necessary, to protect the interests of Borrower therein. The
original Mortgage shall be recorded, and all subsequent assignments of the
original Mortgage shall be recorded in the appropriate jurisdictions wherein
such recordation is necessary to perfect the Lien thereof as against creditors
of Borrower.
-11-
(i) No instrument of release or waiver shall have been
executed in connection with the Mortgage Loan, and no Mortgagor shall have been
released therefrom, in whole or in part.
(j) The proceeds of the Mortgage Loan shall have been fully
disbursed, and there shall be no obligation on the part of Borrower to make any
future advances thereunder. All costs, fees and expenses incurred in making or
closing or recording of the Mortgage Loan shall have been paid in full.
(k) The Mortgage Note shall not be secured by any collateral,
pledged account or other security except the lien of the corresponding Mortgage.
(l) There shall be no obligation on the part of Borrower or
any other Person to make payments in respect of the Mortgage Loan in addition to
those to be made by the Mortgagor.
(m) All parties which have had any interest in the Mortgage
Loan, whether as originator, mortgagee, assignee, pledgee, servicer or
otherwise, are (or, during the period in which they held and disposed of such
interest, were) (1) in compliance with any and all applicable licensing
requirements of the laws of the state wherein the Mortgaged Property is located,
and (2)(A) organized under the laws of such state, or (B) qualified to do
business in such state, or (C) federal savings and loan associations or national
banks having principal offices in such state, or (D) not doing business in such
state so as to require qualification or licensing.
(n) The Mortgage shall contain customary and enforceable
provisions which render the rights and remedies of the holder thereof adequate
for the realization against the Mortgaged Property of the benefits of the
security, including, (i) in the case of a Mortgage designated as a deed of
trust, by trustee's sale, and (ii) otherwise by judicial or non-judicial
foreclosure.
(o) To the best of Borrower's knowledge, there shall not exist
any circumstances or conditions with respect to the Mortgage Loan, the Mortgaged
Property, the Mortgagor or the Mortgagor's credit standing that could be
reasonably expected to materially adversely affect the value or marketability of
the Mortgage Loan.
(p) Each of the documents and instruments included in the
Credit File shall have been duly executed and in due and proper form and each
such document or instrument shall be in a form generally acceptable to prudent
institutional mortgage lenders that regularly originate or purchase mortgage
loans.
(q) The Borrower shall be in possession of the complete Credit
File and there shall be no custodial agreements in effect adversely affecting
the right or ability of Borrower to make the document deliveries required
hereby.
(r) The Mortgage property shall not be damaged by fire, wind
or other cause or loss and there shall not be any condemnation proceedings
pending. To the best knowledge of Borrower, no improvement on any Mortgage
property is in violation of any applicable zoning law or regulation.
(s) All signatures, names and addresses, amounts and other
statements of fact, including descriptions of the property, appearing on the
credit application and other related documents relating to each Mortgage Loan
shall be true and correct and the Mortgagors named thereon will be, as of the
date of each such document upon which signatures appear, of majority age, and
will have the legal capacity to enter into the Mortgage.
(t) Borrower will have reviewed all of the Mortgage Loan
Documents, and all the related documents thereto, and will make such inquiries
as it deems necessary to make and confirm the accuracy of the representations
set forth herein and throughout this Agreement.
(u) Each Mortgage Loan which Borrower warrants is insured by a
private mortgage insurance company shall be so insured.
-12-
9. SALES OF MORTGAGE LOANS AND OTHER COLLATERAL. Until Provident
shall have made a Demand for Payment, Borrower shall be entitled to sell the
Mortgage Loans financed hereunder and the other Collateral in the ordinary
course of Borrower's business, but nothing herein shall be deemed to waive or
release Provident's security interest in any Proceeds of any Collateral. Upon
the sale of any Mortgage Loan financed hereunder, Borrower shall pay to
Provident on its Closing Date, the unpaid amount of the Advance with respect to
such Mortgage Loan, all accrued and unpaid interest thereon through and
including such Closing Date and all Fees, charges and other amounts payable
hereunder. The sales of Mortgage Loans to Third Party Investors shall be handled
in accordance with the requirements set forth in the Policies and Procedures. In
addition, Borrower agrees that Provident shall have the right, in its sole
discretion, to (i) impose additional requirements regarding the delivery of
Mortgage Loan Documents to any Third Party Investor; and (ii) return wire
transfers received in connection with the sale of any Mortgage Loan to the
originating bank if such wire transfer does not comply with the Policies and
Procedures.
10. REMEDIES.
(a) After a Demand for Payment shall have been made by
Provident, all amounts owed to Provident hereunder shall thereupon be
immediately due and payable and no additional or future Advances will be made by
Provident to Borrower hereunder.
(b) From and after any Demand For Payment, Provident shall, in
addition to its other rights and remedies under applicable law, have the rights
and remedies of a secured party under the Uniform Commercial Code with respect
to the Collateral and all other security pursuant to any other Security
Documents between Provident and Borrower. In addition, Provident or its agents
or representatives may take possession of the Collateral and sell the same. For
such purpose, Provident may enter upon the premises where the Collateral shall
be located and remove the same to such other place as Provident shall determine.
Borrower shall immediately, upon Provident's demand, make the Credit Files
available to Provident at Provident's place of business.
(c) Any such taking of possession by Provident shall not
affect Provident's right, which hereby is confirmed, to retain all payments made
prior thereto by Borrower, and in the event of such taking of possession,
Provident may sell the Collateral at a public or private sale or any other
commercially reasonable manner permitted by law. The proceeds of any such sale
or other disposition shall be applied first to the actual and reasonable costs
of such sale, then to the actual and reasonable costs of retaking possession and
storage of such Collateral and then to the satisfaction of the unpaid balance of
the Advances. In the event the proceeds of any such sale are not sufficient to
pay such expenses and to satisfy all amounts due by acceleration or otherwise
with respect to all Advances made pursuant hereto, Borrower shall pay to
Provident any deficiency existing. Provident will give Borrower reasonable
notice of the time and place of any public sale of the Collateral or of the time
after which any private sales or other intended disposition thereof is to be
made. Borrower agrees that the requirement of reasonable notice shall be met if
such notice is mailed, postage prepaid, to the address of the Borrower listed in
Section 11(f) at least 10 days prior to the time of such sale or disposition.
Borrower further agrees and acknowledges that: (i) the Collateral is customarily
sold in a recognized market; (ii) Borrower regularly sells and Provident
regularly purchases mortgage loans similar to the Collateral; and (iii)
Provident may be the purchaser of the Collateral either in a public or private
sale.
(d) From and after any Demand For Payment, Borrower shall pay,
in addition to interest on funds actually advanced, all costs incurred by
Provident in enforcing Provident's rights hereunder, including those incurred in
bankruptcy proceedings, expenses of locating the Collateral, all costs and
expenses actually incurred by Provident in connection with examination,
preservation and protection of the Collateral, examination of the Borrower's
books and records otherwise in connection with the financing pursuant hereto and
reasonable attorney's fees and legal expenses.
(e) If any payment of interest under Section 3 or principal or
interest under Section 4 is not paid when due whether by demand or otherwise,
the unpaid amount of all Advances and all accrued and unpaid interest thereon as
well as any other charges and other amounts due Provident hereunder or under any
-13-
Loan Document shall bear subject matter hereof and supersede all prior
agreements and understandings, both written and verbal, between the parties with
respect to the subject matter of this Agreement and are not intended to confer
upon any Person other than the parties any rights or remedies.
(f) All notices and other communications pursuant to this
Agreement and under any of the other Loan Documents shall be in writing, either
delivered in hand or sent by first-class mail, registered or certified, return
receipt requested, or sent by telecopier or facsimile transmission, addressed as
follows:
If to Borrower, at: MIRADOR DIVERSIFIED SERVICES, INC.
ATTN: PRESIDENT
675 LYNNHAVEN PARKWAY-2ND FLOOR
VIRGINIA BEACH, VA 23452
Fax No. (757) 463-2004
If to Provident, at: The Provident Bank
One East Fourth Street
Cincinnati, Ohio 45202
Attn: Kenneth D. Logan, Senior
Vice President
Mail Stop: 265D
Fax Number: (513) 564-7943
or, as to each party, at such other address as shall be designated by such party
in a written notice to the other party complying as to delivery with the terms
of this Section 11. Any notice or other communication pursuant to this Agreement
of any other Loan Document shall be deemed to have been duly given or made and
to have become effective when delivered in hand to the party to which it is
directed, or, if sent by first-class mail or by telecopier or facsimile
transmission, and properly addressed (i) when received by the addressee; or (ii)
if sent by first class mail, on the third (3rd) Business Day following the day
of the mailing thereof (unless actually received earlier).
-14-
(g) No delay or failure or Provident in exercising any right,
power, remedy or privilege hereunder or under any of the other Loan Documents on
any occasion shall affect such right, power, remedy or privilege or be construed
as a waiver or any requirement of this Agreement; nor shall any single or
partial exercise thereof or any abandonment or discontinuance of steps to
enforce such a right, power or privilege be prejudicial to any subsequent
exercise of such right, power or privilege. Provident's acceptance or approval
of any request, payment, document or instrument pertaining to any Advance made
pursuant hereto shall not constitute any representation or warranty, express or
implied, by Provident as to the validity or sufficiency of any such request,
payment, document or instrument. The rights and remedies of Provident hereunder
are cumulative and not exclusive. All remedies herein provided shall be in
addition to and not in substitution for any remedies otherwise available to
Provident. Any waiver, permit, consent or condition hereof, must be in writing
and shall be effective only to the extent set forth in such writing.
(h) This Agreement shall be binding upon and inure to the
benefit of Borrower and Provident and their respective successors and assigns,
except that Borrower may not assign or transfer any of its rights or obligations
hereunder to any Person or Persons without the express prior written consent of
Provident. If more than one Borrower shall sign this Agreement, the liability of
each hereunder shall be joint and several.
(i) This Agreement shall be governed by and construed in
accordance with the laws of the State of Ohio.
(j) It is hereby stipulated and agreed the TIME IS OF THE
ESSENCE hereon and shall be of the essence as to each of the other Loan
Documents.
(k) Any provision contained in any document which is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions of such document or affecting the validity
or enforceability of such provision in any other jurisdiction.
(l) This Agreement may be executed in any number of
counterparts and by the parties hereto in separate counterparts, each of which
when so executed and deliver shall be deemed to be an original and all of which
taken together shall constitute but one and the same Agreement.
12. WAIVER OF JURY TRIAL; JURISDICTION AND VENUE.
(a) AS A SPECIFICALLY BARGAINED INDUCEMENT FOR PROVIDENT TO
EXTEND CREDIT TO BORROWER, AND AFTER HAVING THE OPPORTUNITY TO CONSULT COUNSEL,
BORROWER AND, IF MORE THAN ONE, EACH OF THEM HEREBY EXPRESSLY WAIVES THE RIGHT
TO TRIAL BY JURY IN ANY LAWSUIT OR PROCEEDING RELATING TO THIS AGREEMENT OR
ARISING IN ANY WAY FROM ITS OBLIGATIONS HEREUNDER.
(b) BORROWER AND, IF MORE THAN ONE, EACH OF THEM HEREBY
DESIGNATES ALL COURTS OF RECORD SITTING IN HAMILTON COUNTY, OHIO AND HAVING
JURISDICTION OVER THE SUBJECT MATTER, STATE AND FEDERAL, AS FORUMS WHERE ANY
ACTION, SUIT OR PROCEEDING IN RESPECT OF OR ARISING FROM OR OUT OF THIS
AGREEMENT. ITS MAKING, VALIDITY, PERFORMANCE, INTERPRETATION OR ENFORCEMENT MAY
BE LITIGATED AS TO ALL PARTIES, THEIR SUCCESSORS AND ASSIGNS, AND BY THE
FOREGOING DESIGNATION BORROWER AND, IF MORE THAN ONE, EACH OF THEM HEREBY
CONSENTS TO THE JURISDICTION AND VENUE OF SUCH COURTS. BORROWER WAIVES ANY AND
ALL RIGHTS UNDER THE LAWS OF ANY OTHER STATE TO OBJECT TO JURISDICTION WITHIN
THE STATE OF OHIO FOR THE PURPOSES OF LITIGATION TO ENFORCE THE OBLIGATIONS
UNDER THIS AGREEMENT.
-15-
IN WITNESS WHEREOF, the undersigned have caused this Warehouse Loan and
Security Agreement to be signed by their duly authorized signatories on and as
of the date first above written.
MIRADOR DIVERSIFIED SERVICES, INC.
BY: /s/ JOHN E. JONES
-----------------------------------
NAME: JOHN E. JONES
TITLE: PRESIDENT
THE PROVIDENT BANK
BY: /s/
-----------------------------------
NAME:
TITLE:
[Graphic FIRST
Omitted] HORIZON.
EQUITY LENDING
March 31, 2000
John E. Jones
United Mortgagee Inc.
675 Lynnhaven Parkway 2nd Fl
Virginia Beach, VA 23452
Dear Mr. Jones:
Welcome to First Horizon Equity Lending. We are pleased to extend
our program approval to United Mortgagee Inc. Your current approval
status allows you to sell closed loans to First Horizon Equity
Lending on a servicing released basis. Your Correspondent ID number
is 2784, and is required for use on all business correspondence.
Enclosed is an executed copy of the Agreement of Purchase and Sale.
Please feel free to call your representative regarding program
policies and procedures.
We will strive to provide superior service and welcome any comments
or suggestions concerning our services and programs.
Again, welcome to First Horizon Equity Lending. We look forward to
a long and rewarding relationship with your organization.
Sincerely,
/s/ RICH GUIDA
------------------------
Rich Guida
President
RG/nmg
Enclosure
First Tennessee Bank National Association
1755 Lynnfield Road
Building D, 2nd Floor
Memphis, TN 38119
Phone: (901) 257-6700
Fax: (901) 257-6703
FIRST HORIZON EQUITY LENDING
================================================================================
1755 Lynnfield Building D
Memphis, Tennessee 38119
AGREEMENT OF PURCHASE AND SALE
This Agreement is made and entered into this 14 day of FEB, 2000, between First
Horizon Equity Lending, which has its principle place of business located at
1755 Lynnfield, Building D, Memphis, Tennessee 38119, (First Horizon Equity
Lending, the Buyer, is hereinafter referred to as "FHEL").
AND
UNITED MORTGAGEE, INC., a VIRGINIA corporation with principle offices at 675
LYNNHAVEN PARKWAY, VIRGINIA BEACH, VA 23452, (hereinafter referred to as
"Seller").
I. DEFINITIONS
(A) Agreement: shall mean this Agreement as same may be amended and
supplemented from time to time. The parties agree that this Agreement shall be
used as the Purchase and Sale Agreement for those loans purchased by FHEL from
Seller in the future, unless otherwise agreed to in writing by the parties.
(B) Essential Mortgage File Documents: each Mortgage Loan file must
include: the original Note, original Mortgage or a true and certified copy of
the Mortgage, Original HUD Disclosure, Original Truth In Lending Disclosure,
ALTA insurance policy including endorsements or "marked up title commitment",
and additional documents set forth in Exhibit A which is hereinafter made a part
of this agreement.
(C) Loan: The Note, the related Mortgage and the Related Assets are
referred to as Loan and collectively as "Loans".
(D) Marked Up Title Insurance Policy, Binder or Certificate: a title
insurance policy on which all liens, mortgages, claims, assessments, defects,
encumbrances and other exceptions affecting or against the Mortgaged Property
have been removed and are insured against in favor of Seller and or Seller's
Assigns.
(E) Mortgage Loans: The Loans identified in the Purchase Schedule,
which may become subject to this agreement.
1
(F) Mortgaged Property or Subject Property: The residential ? property
subject to the Mortgage which secures the Mortgage Loan.
(G) Mortgagor or Borrower(s): The obligor under a mortgage loan.
(H) Note: The original Note or bond or other evidence of indebtedness
evidencing the indebtedness of the Borrower(s) Mortgagor under a Mortgage Loan.
(I) Purchase Price: The purchase price for the Loan(s) described on
each purchase schedule shall be an amount as of the Settlement Date equal to the
sum of the: (1) unpaid principal balances of the Note(s); (2) all interest
accrued (up to but not including the Settlement Date) but unpaid on the Note(s)
(prorated on a 30 day month and a 360 day year); and (3) any premiums due
Seller, if applicable, in accordance with the Purchase Schedule; (4) less any
discount due to the Buyer, if applicable, in accordance with the Purchase
Schedule; and (5) less the fee for recordation of assignments, if applicable.
(J) Purchase Schedule: A list prepared by FHEL identifying Mortgage
Loans to be purchased.
(K) Related Assets: Any and all documents, instruments, collateral
agreements, and assignments and endorsements for all documents, instruments and
collateral agreements, referred to in the Note(s) and/or Mortgage(s) or related
documents thereto, including, without limitation, current insurance policies
(private mortgage insurance, if applicable; flood insurance, if applicable;
hazard insurance; title insurance; and other applicable insurance policies)
covering the Subject Property or relating to the Notes and all files, books,
papers, ledger cards, reports and records including, without limitation, loan
applications, Borrower(s) financial statements, separate assignments of rents,
if any, credit reports and appraisals, relating to the Loans.
(L) Settlement Date: Shall mean the date whereby FHEL agrees to
purchase certain mortgage loans from Seller.
II. OFFER TO SELL AND ACCEPTANCE OF OFFER.
(A) Offer. The Seller may offer from time to time to submit to FHEL a
list of loans, along with the Essential Mortgage File Documents, as defined
herein, for each of the Loans, in order to give FHEL an opportunity to review
them. FHEL shall then deliver a Purchase Schedule on which it has indicated
which Loans, if any, that FHEL is offering to purchase from the Seller and the
Purchase Price for the Loans FHEL is willing to Purchase.
(B) Acceptance. The Seller shall endorse the Note evidencing the Loans
on which the Seller agrees to accept the offer to purchase. Such endorsement
shall constitute the Seller's acceptance of FHEL's offer to purchase the
indicated Loans pursuant to the terms and conditions of this Agreement.
(C) Pre-Approval. On occasion, FHEL may issue to Seller a written
Pre-Approval to cover a specific loan purchase by FHEL hereunder which is
approved by FHEL in advance of Seller making specific loan. The Pre-Approval
Agreement is available to Seller upon request. To the extent of a conflict
between the Pre-Approval and this Agreement, the Pre-Approval shall govern for a
specific purchase and only that purchase.
FHEL shall have the absolute and sole discretion and option to agree to
or to decline to purchase any Loan(s) submitted by Seller for FHEL's review.
2
III. PURCHASE AND SALE OF LOANS.
(A) THE DELIVERY OF LOANS.
On or before the Settlement Date the Seller shall provide FHEL with the
following for each loan purchased:
(1) The Note(s) endorsed by an authorized Officer of Seller to
FHEL, and Mortgage(s) along with an executed individual assignment to FHEL, in
recordable from and originals of all intervening assignments, if any, of the
Seller's beneficial interest in the Mortgage, showing a complete chain of title
from origination to the Seller, including warehousing assignment, with evidence
of recording thereon.
(2) Related Assets.
(3) In the event that Seller cannot deliver to FHEL a duly
recorded assignment of Mortgage or any other document required to be recorded
under this Agreement, on the Settlement Date solely because of a delay caused by
the public recording office when such document(s) has been delivered for
recordation, Seller shall deliver to FHEL a certified copy of each of such
document(s) with a statement thereon signed by an Officer of the Seller
certifying each to be a true and correct copy of document(s) delivered to the
appropriate public recording official for recordation. Seller shall deliver to
FHEL such recorded document(s) with evidence of recording indicated thereon no
later than 15 days after the Seller receives such document, but in any event, no
later than 120 days from the Settlement Date.
(B) PURCHASE AND SALE. On each Settlement Date hereunder, Seller shall
assign, transfer, convey and deliver to FHEL all of its right, title and
interest in and to the Loans, assets and documents as more fully enumerated and
set forth in section IV (A) through (S) inclusive, which is incorporated by
reference.
(C) PURCHASE PRICE. The Purchase Price for the Loans described on each
Purchase Schedule shall be an amount as defined in section (I) (I). The Purchase
Price shall be payable according to the requirements set forth in section (III)
(D) below.
(D) PAYMENT OF PURCHASE PRICE. On each Settlement Date, the Purchase
Price shall be paid as follows: FHEL shall deposit funds by wire transfer to the
Seller's bank.
(E) PREMIUM REBATE. In the event that a premium is paid by FHEL to the
Seller on a Loan and such Loan is prepaid in full by the Borrower(s), other than
by a refinancing by FHEL or any of its subsidiaries or affiliates, within twelve
(12) months of the Settlement Date, the Seller shall, upon demand by FHEL,
refund to FHEL the premium paid by them to the Seller as follows: If prepayment
in full is within one (1) month of the Settlement Date, 12/12ths of the premium
shall be refunded; if prepayment in full is within two (2) months of the
Settlement Date, 11/12ths of the premium shall be refunded; if prepayment in
full is within three (3) months of the Settlement Date, 10/12ths of the premium
shall be refunded; if prepayment in full is within four (4) months of the
Settlement Date, 9/12ths of the premium shall be refunded; if prepayment in full
is within five (5) months of the Settlement Date, 8/12ths of the premium shall
be refunded; if prepayment in full is within six (6) months of the Settlement
Date, 7/12ths of the premium shall be refunded; if prepayment in full is within
seven (7) months of the Settlement Date, 6/12ths of the premium shall be
refunded; if prepayment in full is within eight (8) months of the Settlement
Date, 5/12ths of the premium shall be refunded; if prepayment in full is within
nine (9) months of the Settlement Date, 4/12ths of the premium shall be
refunded; if prepayment in full is within ten (10) months of the Settlement
Date, 3/12ths of the premium shall be refunded; if prepayment in full is within
eleven (11) months of the Settlement Date, 2/12ths of the premium shall be
refunded; if prepayment in full is within twelve (12) months of the Settlement
Date, 1/12ths of the premium shall be refunded. In the event any Loan is prepaid
in full later than twelve (12) months from the Settlement Date of such Loan, no
refund shall be due.
In the event the Note carries a prepayment penalty, FHEL agrees first
to recapture the Premium Rebate from the proceeds of the prepayment penalty and
then from the Seller if there is any deficient balance according to the refund
calculation specified above.
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IV. REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE SELLER
(A) REPRESENTATIONS AND WARRANTIES OF THE SELLER IN GENERAL: It is
understood and agreed by Seller and FHEL that as a material inducement to FHEL
to enter in this Agreement the Seller hereby represents and warrants to FHEL
with respect to each Loan purchased:
1. The Seller is a holder-in-due-course of each Note within
the meaning of the Uniform Commercial Code and is the sole owner of the Loan and
has the right to assign and transfer the Loan to FHEL. The Seller has not sold,
assigned or otherwise transferred any right or interest in or to the Loan and
has not pledged the Loan as collateral for any loan or obligation of Seller or
other purpose. The assignment of the Loan by the Seller to FHEL validly
transfers such Loan to FHEL free and clear of any pledges, liens, claims,
encumbrances, Mortgages, charges, exceptions and/or security interests.
2. Each Note and Mortgage and the Related Assets are in every
respect genuine, are the valid instrument they purport on their face to be, are
the legal, valid, binding and enforceable obligation of the Borrower(s)
thereunder and not subject to any discount, allowance, set off, counterclaim,
presently pending bankruptcy or other defenses; none of the Notes, Mortgages, or
Related Assets are forged or have affixed thereto any unauthorized signature or
have been entered into by any person without the required legal capacity; and no
foreclosure (including non-judicial foreclosure) or any other legal action has
been brought by the Seller or any senior lienholder in connection therewith.
3. The Mortgage has been duly recorded or has been transmitted
to the appropriate recording officer for recording in accordance with the laws
of the state where the real property covered by the Mortgage is located.
4. The Mortgage arose from a bona fide mortgage loan, complying
with the laws of the state where the loan was originated, as amended or
supplemented from time to time, and all other applicable laws and regulations,
to persons having legal capacity to contract.
5. All amounts represented to be payable on such mortgage are, in
fact, payable in accordance with the provisions of the applicable mortgage loan.
6. Upon completion of the purchase, FHEL shall have complete and
undisputed title to the mortgage loan.
7. All disclosures required by Regulation Z issued under the
Truth-In-Lending Act (TILA) of the federal Consumer Credit Protection Act and
the Notice of Right to Cancel prescribed by TILA have been properly prepared and
such loan has been made in full compliance with the Truth-In-Lending Act and
Regulation Z.
8. Seller is, and at the time of the making of a purchased
mortgage loan was, duly licensed under the appropriate governing law, based on
the collateral for the loan and the state where originated.
9. Seller is the owner, without exception, and has the
unqualified right to transfer the loans and all other documents and instruments
in connection therewith.
10. All instruments and supporting documentation evidencing,
securing or otherwise related to the mortgage loans purchased by FHEL are
genuine, valid and enforceable according to their terms, and comply with all
applicable federal and state laws and regulations including, but not limited to,
the Federal Consumer Protection Act, the Equal Credit Opportunity Act and all
other laws, statutes and regulations which may be relevant.
11. There have been no changes made on the Note, Mortgage or any
of the closing documents, and no portion of such security has been released.
12. All funds advanced on behalf of this loan came from the
borrower(s) or the proceeds of the loan. No funds have been advanced by the
Seller, broker or third party.
13. The full principal amount of the Note has been advanced to the
Obligor, either by payment directly to the Obligor or by payment made on request
or approval of the Obligor; all costs, fees and expenses incurred in making and
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closing the loan transaction represented by the Note and Mortgage have been paid
in full and the Note and Mortgage have not been modified or amended and are each
current and not in default at time of purchase.
14. There are no mortgages, prior to the mortgage being purchased
which are open-ended, credit line mortgages, or which may be increased by future
advances.
15. All Notes, Mortgages, documents and disclosures are in full
compliance with applicable state and federal law including but not limited to
all usury laws and regulations.
16. Seller has no knowledge of any zoning violations, condemnation
proceedings and/or any other violations concerning any of the properties secured
by the Mortgage(s) being sold herein at time of purchase.
17. There are no verbal representations, promised or agreements
pertaining to any borrower or document subject to this Agreement. There have
been no written representations, promises or agreements other than those
submitted to FHEL.
18. Borrower(s) is required to sign only one Note at closing. This
Note will be endorsed and forwarded to FHEL at time of purchase.
19. Each mortgage is subject to a due on sale clause.
(B) Seller shall indemnify FHEL for any costs or defense associated
with any breach of any representation or warranty made by Seller in Paragraph 4
of this Agreement and shall indemnify FHEL for any penalties assessed against
FHEL for any violation of the Truth-In-Lending Act by Seller. Any deficiencies
in the Truth-In-Lending disclosure must be cured by Seller to the satisfaction
of FHEL or the loan shall be repurchased in accordance with Paragraph 6 of the
Agreement.
(C) Under no circumstances, shall FHEL and Seller be considered agents
or employees of each other, nor shall this Agreement be construed as creating a
partnership or joint venture.
(D) This Agreement shall remain in full force and effect on all
mortgage loans purchased by FHEL from Seller, under this Agreement. In the event
FHEL sells or transfers these mortgages, this Agreement and all of Seller's
representations, warranties and obligations shall remain in full force and
effect.
(E) Seller agrees to defend, indemnify and hold harmless FHEL from and
against all liability, including attorney's fees, costs, and other expenses,
with respect to any claim made by any party against FHEL due to Seller's breach
of this Agreement.
(F) Seller further covenants, warrants and represents as to each and
every mortgage loan sold to FHEL, as of the date of each and every sale of
mortgage loan receivables, that:
1. Any ledger card or computer run relating to a purchased
mortgage loan fully and accurately reflects (i) the true outstanding unpaid
balance of such loan (ii) all receipts of payment on said loan from the obligor
thereof; (iii) all credits to which said obligor/mortgagors thereof.
2. Each mortgage loan is free from any valid defense, off-set,
counterclaims or recoupment assertable by any obligor/mortgagor thereof to the
best of Seller's knowledge, provided reasonable diligence was done by Seller.
3. No taxes or other liability of Seller shall accrue against or
be collected from FHEL out of the mortgage loan by reason of the purchase by
FHEL of such mortgage loans.
4. Seller is duly organized, existing and in good standing under
the laws of the state of its incorporation.
5. Seller has the requisite power and authority to sell, assign,
and convey the mortgage loans to FHEL and, in accordance herewith, Seller,
through its Board of Directors, will have done all acts necessary to approve the
execution and delivery of this Agreement, the sale of the mortgage loans to FHEL
according to the terms of this Agreement, and the execution and delivery to FHEL
of all instruments appropriate and necessary for the transfer and sale of the
mortgage loans to FHEL.
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Neither the execution and delivery of this Agreement, nor the consummation of
the transaction contemplated by this Agreement will conflict with or result in a
breach of, or constitute a default under any instrument or agreement to which
Seller is a party, or by which it is bound, nor be in violation of any
governmental decree, order or ruling as to which Seller may be bound.
6. None of the real property which is encumbered by a mortgage
securing a purchased mortgage loan is now being repossessed or foreclosed on,
nor is that real property the subject of any insurance claim now pending.
7. None of the purchased mortgage loans are the subject of, or in
any way affected by, any presently pending legal proceeding, including without
limitation, foreclosure, replevin, or similar other legal process. No
obligor/mortgagor on any purchased mortgage loan is now involved in bankruptcy
proceedings.
8. Seller has not in any manner whatsoever paid or agreed to pay
any fee or commission to any agent broker, finder or other person for or on
account of services rendered as a broker or finder in connection with this
Agreement or the transaction contemplated by this Agreement. All negotiations
relating to this Agreement have been conducted by Seller directly and without
the intervention of any person in such manner as to give rise to any valid claim
against FHEL for any brokerage commission, finder's fee or other like payment.
H. From and after the date of this Agreement, Seller shall:
1. Promptly deliver to FHEL payments received on any mortgage
loans purchased under this agreement by FHEL which are applicable to periods
after the Settlement Date.
2. Do and perform, or cause to be done and performed at FHEL's
request, such acts as may be reasonably necessary or desirable in order to vest
in FHEL title to all the mortgage loans sold.
3. Forward promptly to FHEL all communications, inquiries and
remittances which Seller may receive with reference to the purchased mortgage
loans.
4. Provide copies of the Charter and By-Laws of Seller, a
certificate setting forth the names of the persons authorized to execute
documents on behalf of Seller and a resolution of the board of directors of
Seller authorizing sale of the mortgages, all certified by an officer of Seller.
5. Provide such other information as FHEL may reasonably request.
I. Seller agrees that, for a period of three years following the
purchase of any mortgage loan, Seller, its agents, affiliates or assigns, will
not, directly or indirectly, solicit the contract borrowers for the purpose of
making a real estate secured loan for the purpose of refinancing, in any way the
contract indebtedness.
J. Seller agrees that it will not, at any time, give or sell a list of
the obligor(s) to any person or entity. The aforesaid prohibition shall not
prohibit Seller from showing any customer list to any auditors, regulators,
employees, attorneys, directors, accountants and other professionals associated
with Seller provided that the aforesaid parties shall not copy said list for use
by others. All information received by the purchaser shall be kept in strict
confidence.
K. FHEL hereby represents and warrants to Seller as follows:
1. FHEL is duly organized, validly existing and in good standing
under the laws of the state of its incorporation and in all states where is it
qualified to do business.
2. All corporate proceedings required to be taken by FHEL to
authorize its execution of and performance under this Agreement have been fully
and properly taken and FHEL's execution of and performance under this Agreement
does not violate any provision of FHEL's Certificate of Incorporation or By-Laws
or any contract or agreement by which FHEL is bound.
3. FHEL is and will, at all times, be duly licensed under
applicable law to purchase and acquire any mortgage loan sold to it by Seller.
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M. Seller states that there is no litigation either pending or in
progress which would adversely threaten the enforceability of the loans being
sold.
N. Seller agrees that it shall, at any time and from time to time
after the date hereof, upon request of FHEL, do, execute, acknowledge and
deliver all such further acts, assignments, transfers, conveyances, powers of
attorney and assurances as may be required for the selling, assigning,
transferring, conveying, granting, assuring and confirming to FHEL and its
successors and assigns, title to the Notes or the Mortgages and consummating the
various transactions provided for or contemplated by this Agreement.
O. This Agreement shall not be assignable by Seller without the prior
written consent of FHEL, provided that if FHEL consents, Seller shall remain
fully and completely liable for the performance required by it hereunder. This
Agreement shall run with each Note and Mortgage and shall inure to the benefit
or each successive holder thereof.
P. Even in this Agreement is terminated as to future purchases and
sales, all other provisions of this Agreement shall remain in effect so long as
there is outstanding principal or interest due FHEL or FHEL's assignee on any
Note, or until such time as FHEL's interest or assignee's interest in each and
every note has been completely liquidated.
Q. Upon request by FHEL, Seller will provide so long as this Agreement
is in effect, as soon as available, and in any event within ninety (90) days
after the end of each fiscal year of Seller, certified financial statements of
Seller, prepared by independent certified public accountants in accordance with
generally accepted accounting principals.
R. No consent, waiver or approval of any entity (public or private) is
or will be required in connection with the execution, delivery, performance,
validity or enforcement of this Agreement or any other agreement, instrument or
document to be executed or delivered in connection herewith or pursuant hereto.
S. No Mortgage Note has been secured by any collateral except for the
lien of the corresponding mortgage referred to herein.
V. BREACH OF REPRESENTATIONS AND WARRANTIES.
(A) REMEDY FOR BREACH. In addition to any rights or remedies that FHEL
has at law or in equity, if at any time there is a breach of any material
representation or warranty set forth herein by Seller, the Seller shall upon
demand by FHEL, and at the sole option and absolute discretion of FHEL
repurchase the Loan affected for the Buy-Back Price as set forth in paragraph C
below, within ten (10) days notification; or (2) if the Loan(s) has been sold by
FHEL or the Subject Property has been liquidated or sold by FHEL, the Seller,
shall, within ten (10) days of notification, pay FHEL the amount of the loss as
defined below in this section.
(B) REASSIGNMENTS. Upon receipt of the Buy-Back Price, in full, in
immediately available funds, FHEL shall reassign the Loan affected any right it
may have in the relevant Subject Property to the Seller free and clear of all
liens, encumbrances, claims, or interests of any person or entity claiming by,
through or under FHEL without recourse and shall execute and deliver to the
Seller in recordable form an assignment of FHEL's beneficial interest in the
affected Mortgage, as well as other documents necessary to reflect the
reassignment of any protection and insurance policies.
(C) BUY-BACK PRICE. The term "Buy-Back Price" shall mean the sum total
of: (1) the outstanding principal of the Loan, with accrued interest thereon
through the date the Loan is repurchased by Seller; (2) all advances made by
FHEL and all charges due from the Borrower(s); (3) the total amount, including
accrued interest and other expenses paid by FHEL to any senior lienholder, if
any, to secure a priority lien position; (4) all reasonable and necessary
expenses, losses and damages paid or incurred by FHEL in connection with the
Loan or any investigation of said Loan and/or the related collateral, including,
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but not limited to, property taxes, maintenance costs, interest expenses,
insurance, appraisals, advertising, sales commissions, reasonable attorney fees,
expenses and costs, fines and penalties; and (5) rebate of premium due FHEL, if
applicable.
(D) DEFINITION OF LOSS. The term "Loss" shall mean the negative result,
if any, of the following calculations: (a) the sum total of: (i) the outstanding
principle balance of the Loan, with accrued interest thereon through the date
the Loan is sold or date the collateral is liquidated; (ii) all advances by FHEL
and all charges due from the Borrower(s); (iii) the total amount paid by FHEL to
any senior lienholder, if any, to secure a first lien position; (iv) accrued
interest on all Mortgage Loans purchased from senior lienholder from the date
such Mortgage Loans were purchased through the date the Loan is sold or the date
the collateral is liquidated; and (v) all other reasonable and necessary
expenses, losses and damages incurred by and/or paid by FHEL in connection with
the Loan or an investigation of said Loan or the sale or liquidation of the Loan
and/or the related collateral, including, but not limited to, reasonable
attorney fees, expenses and costs, property taxes, maintenance costs, insurance,
appraisals, advertising, sales commissions, fines and penalties; less the net
proceeds from the sale of the Loan or the sale or liquidation of the Subject
Property or the collateral.
(E) REMEDY FOR NON-DELIVERY OF DOCUMENTS. Notwithstanding anything to
the contrary, in the event that the Seller is required to deliver to FHEL any
documents related to a purchased Loan and the Seller fails to deliver such
document in the proper form on the date or within the time period specified by
the controlling section of this Agreement, FHEL shall notify the Seller of the
breach, and the Seller shall have thirty (30) days from the date of notice to
cure the breach. If the Seller has not cured the breach within the thirty (30)
day cure period, the Seller shall immediately repurchase the Loan upon FHEL's
demand. The Buy-Back Price shall be determined in accordance with Section VI(C).
Any Loan returned by FHEL pursuant to this paragraph shall be without recourse
representation or warranty.
(F) REMEDY TO INSURE ACCURACY OF REAL ESTATE APPRAISAL. FHEL may, at
its own expense, in order to verify the accuracy of real property appraisals
prepared from Seller, order a reappraisal of the property secured by a Mortgage.
If the reappraisal obtained by FHEL indicates a fair market value which is more
than fifteen (15%) percent less than the original appraisal value, then upon
receipt by Seller from FHEL of a signed copy of the reappraisal, Seller shall
repurchase the Loan at the Buy-Back Price, (as defined in section (V) (C),
above) and reimburse FHEL for the cost of the appraisal subject to the
following: If Seller disputes the validity of the reappraisal prepared by FHEL's
appraiser, Seller, may, at its own expense, request FHEL to obtain a third
appraisal, and only if such third appraisal is also more than fifteen (15%)
percent less than the original appraisal value shall Seller be required to
repurchase the Loan at the Buy-Back Price. FHEL shall choose the appraiser for
the third appraisal with Seller's approval, which shall not be unreasonably
withheld. The appraisal must be performed in accordance with industry standards
for the appraising industry in the area in which the property is located, and
the appraiser must be independent with respect to both parties unless otherwise
agree to by the parties. In determining the appropriate appraisal value, the
review appraiser must determine the appraised value as of the original appraisal
date using comparable sales that were available as of the date of the original
appraisal (without requirement of home equity). Section F is not applicable as
long as Seller uses FHEL approved appraiser.
However, anything to the contrary notwithstanding, FHEL reserves the
right not to request the Seller to repurchase the Loan should be reappraisal
cause the combined loan to value not to exceed the maximum allowable combined
loan to value class under which the loan was purchased.
(G) REMEDY FOR FIRST PAYMENT DEFAULT. However, anything to the contrary
notwithstanding, in the event the Borrower fails to make the first payment due
to the Buyer within (30) days of the payment due date, regardless f whether such
payment is subsequently paid by the Borrower, the Buyer, at its sole and
absolute discretion, shall have the right to have Seller repurchase said Loan(s)
at the Buy-Back Price.
VI. INDEMNIFICATION (BY SELLER)
(A) Seller agrees to protect, indemnify, and hold FHEL and its
employees, officers, and directors, harmless against, and in respect of, any and
all losses, liabilities, costs and expenses (including reasonable attorney's
fees), judgments, damages, claims, counterclaims, demands, actions or
proceedings, by whomever asserted, including but not limited to, the Borrowers,
8
against any person or persons who prosecute or defend any actions or proceedings
as representatives of or on behalf of a class or interested group, or any
governmental instrumentality, body, agency, department, or commission, or any
administrative body or agency having jurisdiction pursuant to any applicable
statute, rule, regulation, order or decree, or the settlement or compromise of
any of the foregoing, providing however, any of the foregoing arises out of, is
connected with or results from any breach of representations, covenants or
warranties made by the Seller in relation to the Loans sold to FHEL hereunder.
(B) The waiver of any breach, term, provision or condition which is
part of this Agreement shall not be construed to be a waiver of any other or
subsequent breach, term, provision or condition. All remedies afforded by this
Agreement for a breach hereof shall be cumulative; that is, in addition to all
other remedies provided for herein or at law or in equity.
(C) Provided further, in the event of any legal action, including
counterclaims, wherein the claim is based upon the alleged facts that would
constitute a breach of any one or more of the warranties, covenants, and
representations made or assumed by Seller under the terms hereof, Seller shall
thereupon, at FHEL's option, repurchase without recourse such Loan at the
Buy-Back Price.
VIII. MISCELLANEOUS
(A) ADDITIONAL COVENANTS.
1. Each party shall, from time to time, execute and deliver or
cause to be executed and delivered, such additional instruments, assignments,
endorsements, papers and documents as the other party may at any time reasonably
request for the purpose of carrying out of this Agreement and the transfers
provided for herein.
2. The Seller shall, upon the request of FHEL, sign a letter, in
the form to be approved by FHEL and in conformity with the terms and conditions
hereof, addressed to all the Borrower(s) on the Loans announcing the sale
evidenced hereby and instructing such Borrower(s) to recognize FHEL as the
Seller's successor in interest.
3. After any Settlement Date hereunder, the Seller will hold in
trust for FHEL all sums received by the Seller from Borrower(s) on any Loan
purchased pursuant to the Agreement and pay them to FHEL within three (3)
business days of the receipt of those sums.
(B) SURVIVAL OF COVENANTS, AGREEMENTS, REPRESENTATIONS AND WARRANTIES;
SUCCESSORS AND ASSIGNS. All warranties, representations and covenants made by
either party in this Agreement or in any other instrument delivered by either
party to the other, including those made by third parties for the benefit of
either party, shall be considered to have been relied upon by the other party
(unless otherwise agreed to in writing by the parties) and shall survive the
termination of this Agreement. FHEL reserves the right to proceed against third
parties to enforce any representations, warranties, and covenants made by them
for the benefit of the Seller.
(C) SEVERABILITY. If any provision, or part thereof, of this Agreement
is invalid or unenforceable under any law, such provision, or part thereof, is
and will be totally ineffective to that extent, but the remaining provision, or
part thereof, will be unaffected.
(D) ATTORNEY'S FEES. In the event of any action at law, in equity,
arbitration or otherwise between the parties in relation to this Agreement or
any loan or other instrument or agreement required or purchased or sold
hereunder, the non-prevailing party, in addition to any other sums which such
party shall be required to pay pursuant to the terms and conditions of this
Agreement, at law, in equity, arbitration or otherwise shall also be required to
pay to the prevailing party all costs and expenses of such litigation, including
reasonable attorney's fees.
(E) WAIVERS. No waiver of any term, provision or condition of this
Agreement, whether by conduct or otherwise. In any one or more instance, shall
be deemed to be, or construed as a further or continuing waiver of any such
term, provision or condition, or of any other term, provision or condition of
this Agreement.
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(F) NOTICE. Any notice or other communication in this Agreement
provided or permitted to be given by one party to the other must be in writing
and given by personal delivery or by depositing the same in the U.S. Mail
(certified mail, return receipt requested), addressed to the other party to be
notified postage prepaid. For purposes of notice, the addresses of the parties
shall be as follows:
First Horizon Equity Lending
1755 Lynnfield Building D
Memphis, TN 38119
ATTENTION: Jackie Braddock
SELLER:
UNITED MORTGAGEE, INC.
675 LYNNHAVEN PARKWAY
VIRGINIA BEACH, VA 23452
ATTENTION: JODY WILLIAMS
The above addresses may be changed from time to time by written notice from one
party to the other.
(G) TERMINATION. This Agreement may be terminated, with or without
cause, by either party hereto upon written notice to the other party, and any
termination will be effective immediately. Any termination hereof shall not
affect Broker's liability for any alleged breach of a covenant, representation
or warranty with respect to any Packages that have been received by FHEL prior
to the respect to any Packages that have been received by FHEL prior to the
aforementioned notice of termination; provided, however, that if this Agreement
is terminated by FHEL for the breach of any covenant, representation or
warranty, then FHEL, in its sole discretion, shall have the option to promptly
return such Packages to Broker without further obligation.
(H) INSURANCE PREPAYMENT. Insurance refund or credit or any kind
whatsoever shall be the sole responsibility of the Seller in the event of
prepayment of any Loan, cancellation of insurance or any other event requiring
refunding or credit of unearned insurance premiums. Upon FHEL's demand, Seller
shall pay to FHEL, from the Seller's own funds, any required insurance premium
rebate resulting from the prepayment, cancellation, refinancing or other
termination of any mortgage Loan. Upon such payment, FHEL shall assign in
writing any rights it had to require that the insurer reimburse FHEL for any
rebate made to Borrower(s).
(I) ASSIGNMENT. The Seller shall not, without prior written consent of
FHEL, assign any of its right or obligations hereunder.
(J) ENTIRE AGREEMENT. This agreement and the Exhibits attached hereto,
and the documents referred to herein or executed concurrently herewith
constitute the entire agreement between the parties hereto with regard to the
subject matter hereof, and there are no prior agreements, understandings,
restrictions, warranties, or representations between the parties with respect
thereto.
(K) GOVERNING LAW. This agreement shall be governed by and construed in
accordance with the laws of the State of New York. The provisions of this
paragraph shall not affect the provision of any Note, Mortgage, or Related
Assets which cause the laws of the United States or any other state to be
applicable. This Agreement shall be interpreted fairly and in accordance with
its provisions and without regard to which party drafted it.
(L) ARBITRATION, JURISDICTION AND VENUE. With respect to any
controversy, argument or claim arising out of or relating to this Agreement, or
any breach thereof (including but not limited to, a request for emergency
relief) the Seller hereby consents to the exclusive jurisdiction of the Shelby
County, Tennessee Courts, or the Federal District Court for the Western
District of Tennessee and waives personal service of any and all process upon
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them and consents that all such service of process made by registered or
certified mail directed to them at the address stated herein and service so made
shall be deemed to be completed five (5) days after mailing. The Seller waives
trial by jury and waives any objection to jurisdiction and venue of any action
instituted hereunder, and agrees not to assert any defense based on lack of
jurisdiction or venue and consents to the granting of such legal or equitable
relief as is deemed appropriate by the court, including but not limited to, any
emergency relief, injunctive or otherwise.
However, anything to the contrary notwithstanding, except with respect
to emergency relief, FHEL shall have the sold and exclusive option and
discretion to have any controversy, argument or claim arising out of or relating
to this Agreement, or any breach thereof, settled in Memphis, Shelby County,
Tennessee, in accordance with the rules of the American Arbitration Association
(as modified below), and judgment upon the award may be entered in any Court
having jurisdiction thereof.
The arbitration panel shall be made up of three members which shall be
appointed: one by FHEL, one by Seller and the third (a neutral) by the first two
arbitrators. Each arbitrator shall be a lawyer experienced in matters relating
to real estate and mortgage banking. Discovery shall be permitted in connection
with the arbitration proceeding within the reasonable discretion of the
arbitration panel. The arbitration panel may not however hear or decide any
claim for punitive damages. The decision (award) shall be in writing and shall
set forth the reasoning and legal basis therefore, and such decision may be
appealed by either party if the party believes that the written decision (award)
is based on an error of law. The facts determined by the original panel will be
final and no appeal of such findings may be made. Such an appeal shall be taken
to a three-member arbitration panel, the members of which shall be selected in
accordance with the above described procedures, and the panel's review shall be
limited to the application of the statutory and decisional law of the State of
Tennessee.
In the event that the remedies or other terms outlined in this
Agreement conflict with the terms of any endorsement by the Seller of any Note
evidencing a Loan purchased by FHEL from the Seller, including, but not limited
to, an endorsement stating that the assignment of the Note is without recourse,
the remedies and terms of this Agreement shall govern and control.
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IN WITNESS WHEREOF, the parties have executed this Agreement on the date first
above written:
BUYER: FIRST HORIZON EQUITY LENDING
ATTESTED TO BY: By: /s/ T. R. HOWELL
-----------------------------------
T. R. Howell
On 3-31-00, before me personally appeared T. R. Howell to me known to be the
person(s) described in and who executed the foregoing instrument and
acknowledged that he/she/they executed the same as his/her/their free act and
deed.
/s/ NANCY M. GUY
----------------------------------------
Nancy M. Guy
Notary Public
My Commission Expires: MY COMMISSION EXPIRES
AUG. 28, 2001
SELLER: UNITED MORTGAGEE, INC.
ATTESTED TO BY: By: /s/ JOHN E. JONES
-----------------------------------
John E. Jones, President
On 2-15-00, before me personally appeared John E. Jones to me known to be the
person(s) described in and who executed the foregoing instrument and
acknowledged that he/she/they executed the same as his/her/their free act and
deed.
/s/ STACY R. STEVES
----------------------------------------
Stacy R. Steves
Notary Public
My Commission Expires: 2-29-00
NOTICE TO CORRESPONDENT
First Horizon Equity Lending is not offering Lines of Credit to Correspondent
Lenders at this time. First Horizon may offer Lines of Credit in the future,
which at that time, agreement of purchase and the sale signed by correspondent
will apply.
/s/ JOHN E. JONES 2/14/00
- --------------------------------------- -------------------------.
Correspondent John E. Jones, President Date
FLEET [LOGO] Correspondent Lending
May 2, 2000 Fleet Mortgage Corp.
803-929-7900
Fax 803-929-7945
Mail Stop: SC CO 0355
John Jones 1333 Main Street
United Mortgagee, Inc. Columbia, SC 29201
2620 Southern Blvd.
Virginia Beach, VA 23452
Dear John:
Enclosed please find The Annual Certification of Compliance Form and the Annual
Information Update Survey.
ANNUAL CERTIFICATION OF COMPLIANCE FORM:
Fleet's Correspondent Lending division is committed to demonstrating to all
applicable regulatory agencies and investors that we effectively communicate to
our Correspondents, Fleet's requirements regarding compliance with State and
Federal regulations, particularly the Equal Credit Opportunity Act (ECOA) and
Regulation B. Both the Correspondent Manual and Purchase and Loan Sale Agreement
clearly state Fleet's position relative to the lender's obligation with regard
to compliance with such regulations. The enclosed Annual Certification of
Compliance form, referenced in the Eligibility section of our Correspondent
Manual, provides us with the written acknowledgment that our Correspondents
understand Fleet's policies and procedures.
Specifically, ECOA requires that if a transaction involves a credit decision by
more than one lender, and no acceptable credit is offered, each lender must
issue an adverse action notice unless each denying creditor is listed on a
single adverse action notice. For loans that have been contract underwritten per
the Correspondent Manual, Fleet permits its Correspondents to complete a single
adverse action notice to the borrower as long as Fleet Mortgage Corp. is
represented on the notice as a denying creditor.
Please complete and execute the attached Certification and return to Fleet no
later than June 16, 2000. In addition, please include a sample copy of the
Adverse Action Notice you send on declined contract underwriting loans
indicating Fleet as the creditor.
Please Note: If you are a lender with delegated underwriting approval, this
Certification is required in the event that a loan is contract underwritten for
you and sold to Fleet.
ANNUAL INFORMATION UPDATE SURVEY:
Please complete this form and include it when forwarding your Certification of
Compliance to Fleet. To ensure that we provide the highest level of customer
service, we must maintain current information in our Correspondent Lending
System (database).
Thank you for your cooperation.
Sincerely,
/s/ SHULAZA S. LYLES
- --------------------------------
Shulaza S. Lyles
Correspondent Operations Liaison
cc: Rusty Leitzsey
47153
ANNUAL CERTIFICATION OF COMPLIANCE
for
FLEET MORTGAGE CORP.
- --------------------------------------------------------------------------------
INSTRUCTIONS FOR COMPLETION
> Print or type your name and address in the "Correspondent Information"
section.
> Sign as certification and return to the following address no later than 30
days after receipt:
Fleet Mortgage Corp.
1333 Main Street
Columbia, SC 29201
Attention: Pam Ulmer SC-CO-0355
- --------------------------------------------------------------------------------
================================================================================
CORRESPONDENT INFORMATION
- --------------------------------------------------------------------------------
Company Name:
UNITED MORTGAGEE, INC.
- --------------------------------------------------------------------------------
Address, include City State and Zip Code.
675 Lynnhaven Parkway - 2nd Floor; Virginia Beach, VA 23452
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
================================================================================
================================================================================
> As authorized representative for the above referenced Lender, I do hereby
certify that all loans are originated in compliance with all local, state and
federal regulatory requirements, particularly the Equal Credit Opportunity Act
(ECOA) and Regulation B.
> I have attached a sample copy of the current Adverse Action Notice* used if
Fleet (or it's approved agent) renders an adverse underwriting decision. The
attached notice must show Fleet Mortgage Corp. as a denying lender to complete
our records.
================================================================================
/s/ JOHN E. JONES 5/11/00
- --------------------------------------------------------------------------------
Authorized Signer: Date
JOHN E. JONES, PRESIDENT
- --------------------------------------------------------------------------------
Printed/Typed Name and Title of Authorized Signer
757-463-3303
- --------------------------------------------------------------------------------
Phone Number (Contact number for questions)
- --------------------------------------------------------------------------------
*ECOA requires that if the transaction involves a credit decision by more than
one lender (for example, originated by the above referenced Correspondent and
submitted to several investors for underwriting) and no acceptable credit is
offered the applicant, each lender must give the adverse action notice. To avoid
sending multiple notices, Fleet permits the Correspondent to issue a single
Adverse Action Notice, where no acceptable credit is offered by any investor, as
long as Fleet Mortgage Corp. is represented on the combined notice as a denying
"creditor."
PLEASE NOTE:
If the application is given to several investors, rejected by some but
approved by one, no adverse action notice is required.
- --------------------------------------------------------------------------------
================================================================================
INFORMATION UPDATE SURVEY
================================================================================
RE: United Mortgagee, Inc.
Fleet Mortgage Corp. maintains a database of information regarding each approved
Correspondent. In order to ensure the highest levels of customer service, it is
critically important that our information be completely accurate.
> Please complete the following information and fax it to (803) 929-7110.
COMPANY TAX ID NUMBER: 54-1563785
----------
AGENCY APPROVAL INFORMATION:
Fleet maintains these numbers for ease in certain servicing issues
electronically with the various agencies.
Agency Name Approval Seller/Servicer/Mortgagee Number
================================================================================
Fannie Mae [ ] Yes
----------------------------------------
Freddie Mac [ ] Yes
----------------------------------------
FDIC [ ] Yes
----------------------------------------
FHA (Title I) [X] Yes 70889-00001
----------------------------------------
FHA-DE [X] Yes 7316-00003
----------------------------------------
VA [X] Yes 685281-00001
----------------------------------------
VA-Automatic [ ] Yes
----------------------------------------
CONTACT NAMES
Fleet uses the contact information for various communications.
CONTACT NAME PHONE FAX INTERNET
==========================================================================================
Executive John E. Jones 757-463-3303 757-463-2004 JOHN_JONES12@HOTMAIL.COM
------------------------------------------------------------------------
Primary Shirley Corrigan 757-463-3303 757-463-2004 SACORRIGAN@EXCITE.COM
------------------------------------------------------------------------
Secondary Mktg Bob Costello 757-463-3303 757-463-2004 BCKC5@AOL.COM
------------------------------------------------------------------------
Final Document Angela Hobbs 757-463-3303 757-463-2004 ANGELAHOBBS@EXCITE.COM
------------------------------------------------------------------------
Confirmations Terry Fischer 757-463-3303 757-463-2004 TFISCHER12@EXCITE.COM
------------------------------------------------------------------------
Purchase Sched's Angela Hobbs 757-463-3303 757-463-2004 ANGELAHOBBS@EXCITE.COM
------------------------------------------------------------------------
Customer Service Linda Raynell 757-463-3303 757-463-2004 LRAYNELL@EXCITE.COM
------------------------------------------------------------------------
Quality Control Terry Fischer 757-463-3303 757-463-2004 TFISCHER12@EXCITE.COM
------------------------------------------------------------------------
Shipping Angela Hobbs 757-463-3303 757-463-2004 ANGELAHOBBS@EXCITE.COM
------------------------------------------------------------------------
Accounting Mia Roberson 757-463-3303 757-463-2004 MIA_ROBERSON@EXCITE.COM
------------------------------------------------------------------------
Underwriting Terry Fischer 757-463-3303 757-463-2004 TFISCHER12@EXCITE.COM
------------------------------------------------------------------------
Are you Loan Prospector or Desktop Underwriter approved?
Loan Prospector [ ] Yes [X] No
Desktop Underwriter [ ] Yes [X} No
2.16 Salaries/employment
Salaries & Employment Contracts
John Edward Jones, President $185,000
Linda Raynell, Vice President/Secretary $85,000
3.7 TCT Liabilities
None
3.11 TCT intellectual property
None
3.12 Pending Litigation
None
3.16 TCT Agreements
None
3.17 TCT Bank Accounts
None
Schedule
1 TCT Capitalization
2 Capitalization of Mirador Acquisitions
MIRADOR BUSINESS PLAN - EXECUTIVE SUMMARY
INTRODUCTION - Mirador was formed in 2000 to become the leading provider of
financial services to mid-market households in all fifty states of the US.
The company's vision is that mid-market customers need the same breadth of
services as those in higher income brackets, and they need access to those
services from a combination of on-line and in-person delivery systems. Mirador
intends to deliver a broad range of financial products and services that are
good for the mid-market consumer -- not just good for the financial institution
- -- thereby developing a long-term relationship based on results and trust.
COMPANY OVERVIEW - Mirador was formed by combining two mortgage banks with six
regional mortgage brokers and the sales force of three other brokerages, giving
the company mortgage brokerage licenses in 20 states, with another 20 state
licenses soon to follow. United Mortgagee, Inc. a mortgage bank was the first
company acquired by Mirador. United Mortgagee was the acquirer of the mortgage
brokerage companies and is the holder of the mortgage lending licenses.
The pro-forma 1999 income of United Mortgagee, Inc. and acquisitions as shown in
the attachments were $15,076,608 with a net income of $3,266,367 before taxes,
depreciation and amortization for 1999. No consideration has been made for the
four sales organizations, and the Internet web sites that were acquired. If
there were consideration for that fact the fro-forma 1999 income would have
exceeded over $24 million.
United Mortgagee operates 16 retail mortgages offices nation wide, and has a
very strong Internet business getting an average of 700 loan applications per
month.
Mirador has agreements in place to raise it's warehouse lines to $75 million and
is confident it will be able to increase that amount to exceed $100 million if
needed. We now have relationships with Countrywide, Bank United, Provident
Financial Services and Regions Funding.
The use of customer data with their permission is a key feature of Mirador's
strategy. Authorized use of customer data, called permission marketing and CRM
or Customer relationship marketing, will be used by Mirador to offer customers a
full service financial plan and all of the products and services that a customer
needs -- a one-stop financial supermarket.
MARKET OPPORTUNITY - The market for Mirador is virtually unbounded. While stock
brokers and banks/insurance companies go after the top tier of the market and
home finance companies go after the bottom of the market, no one has
successfully defined a strategy for the bulk of the market -- homeowner making
between $50-$100,000 per year.
The market opportunity as seen through Mirador's strategy is to capture the
financial needs of mid-market homeowners. These homeowners are most often
married with children and with both parents working. These homeowners need all
of the elements of financial assistance starting with a financial plan. From the
financial plan the next steps are most often disability and/or life insurance
followed by a savings and investing plan.
This market today is very poorly served and very fragmented. The mid-market
homeowner has to deal with a mortgage company, and insurance agent or two, a
local bank, a stock broker, a tax preparation service, a home loan company,
etc., etc. As a result, most of this market does not have even a basic financial
plan or adequate life insurance. And the mid-market homeowner pays too much for
financial products that are not well matched to their needs. For example, whole
life and annuities are very high margin products for insurance agents, but are
not usually good products for the middle-income market.
Mirador intends to rapidly become the dominant provider of financial products
and service to the middle-income market by offering a bundle of offerings
tailored to the needs of this market.
OFFERING OVERVIEW - Mirador intends to enter the market with it's mortgage
products as currently structured and quickly add free financial planning based
on it use of the data gathered in the mortgage application process. The free
financial plan will be the platform for all of the other financial products.
A complete mortgage loan application file has the following information:
Full names, addresses, phone numbers;
Demographic data - ages, race, sex, education, etc.;
Employment, job history;
Income - all sources, W-2, 1099, investment, etc.;
Assets - real estate, bank accounts, investments, cars, etc.;
Liabilities - mortgages, car loans, installment and revolving debt,
liens, etc.;
Credit Report - with a credit score and verifications;
Dependents - ages of children;
Property Information - Appraisal, Deeds, titles, mortgages, liens,
taxes;
Insurance Information - property and life.
The application has literally HUNDREDS OF FIELDS, all of which are tracked by
Mirador and can be data mined for unlimited INDIVIDUALLY TAILORED OFFERS ON A
REFERRAL BASIS, starting with a financial plan. Few, if any, of the target
customers have any financial plan at all. This is both a problem and an
opportunity. The problem is that the mid-market segment is not comfortable with
financial planning; the opportunity is that they need one. Mirador will
capitalize on the education that the press and the stock market advertisers are
giving the mid-market, plus Mirador will make the financial plan very graphical
and easy to understand.
The financial plans will focus on the most pressing and easy to understand
issues for most of the customers - the lack of insurance and a savings plan.
With the data that is gathered in the mortgage application process, a financial
plan that is very comprehensive can easily be prepared. This data and the plan
itself will be gathered and presented on the Internet for those who are
comfortable with that as well as through local representatives. The ability of
the Mirador customers to manipulate the plan assumptions and print out the
graphs will be a key selling feature.
After the financial plan is in place, the on-line and off-line connections will
be used to keep the plan updated and to continue to offer a full plate of
financial products and to update those that are in place. The financial plan
will also be used as an entry point for those customers who do not apply for a
mortgage or who do not qualify for a mortgage - free financial planning under
the customer's control is the second selling point of the Mirador offerings.
STRATEGY AND KEYS TO SUCCESS - Mirador's market strategy can be defined in three
stages: entry, growth, and success.
Mirador is the entry phase today, as it gains critical mass through acquisitions
and begins to prepare its initial offerings of mortgages, financial plans, and
basic financial products. Once the company is established in major key markets
and has a trained staff in place, rapid growth will be experienced as more of
the market is attracted to the tailored offerings and the personal service
approach. Branding of the Mirador name will be essential to the growth stage of
the business. With growth comes additional products and partners, setting the
stage for the success stage where Mirador dominates the mid-market segments.
Keys to Success include:
o Use of local advertising and "infomercials" to generate leads for new
mortgage applications
o Use of the mortgage application as a data gathering tool
o Use of computer "data mining" to use the same data as an input to
different financial planning products
o Focus on the key elements of financial plan -- typically insurance and
investments
o Focus on products that are right for the segment, not just high-margin
products
o Hiring and training and motivating the right staff, which means finding
middle management in well run companies and giving them the opportunity
to make more money in a professional atmosphere
o Adding products through internal development as well as partnerships and
acquisition, e.g. tax planning software, that give the customers all of
the products that they might need
o Use of the Internet to supplement the personal touch, a) by gathering
data, b) by giving the appearance of customized feedback to the
customers, and c) by allowing the customers to interact with the
planning tool - providing more data for use in developing products.
In summary, Mirador has developed a phased approach to market entry and growth
and has identified the key success factors at every step.
KEY PARTNERS - Mirador will develop a network of key partners in technology,
products and services, and distribution/sales. The first key partner is
InfoWell, based in Blue Bell, Pennsylvania.
InfoWell has three products:
WWW.INFOWELL.COM provides an automated interface to transmit the
broker's loans to correspondent wholesale lenders for approval, plus
order required vendor services (credit reporting agencies, appraisers,
etc.) Wholesaler lenders and vendors pay transaction fees for broker
business.
WWW.E-REFERRAL.NET is the network of marketers that pay user fees for
access to the extremely detailed consumer database. For example,
insurance companies or credit card companies. Each broker "owns" their
consumers' data that resides in secure InfoWell "data vaults". Fees
paid by the referred marketers are shared between the originating
broker and InfoWell;
WWW.WHEREAREMYPAPERS.COM is the consumer access portal. This allows
consumers, each with their own secure web page, to view loan status and
always have a place to find important papers such as their deed, title
search, credit history, or mortgage information. Consumers will also
find individually tailored offers from e-Referral.net participants.
Brokers provide their customers a unique service and InfoWell will earn
"click through" fees.
Mirador has strong development ties to InfoWell and intends on using the
InfoWell products to process loans, to use the customer database for financial
products, and to build a one-to-one relationship with the Mirador customers.
Mirador is in the development stage of an alliance with a national financial
services company to cross sell mortgages, insurance and investments (mutual
funds).
COMPETITION - Mirador does not have any direct competition for the bundle of
services for the middle-income market.
Very large competitors such as Citibank/Primerica have a very large volume of
mortgage applications and a very large sales force. However, they focus on the
main product that they are offering (and getting compensated for) as either a
mortgage or insurance. Other large firms offer financial planning, such as IDS,
but do not have strategy of starting with the mortgage application.
At the other end of the market are the sub-prime lenders, such as Beneficial,
who are focused on very high cost debt consolidation. Competitors also include
large specialists such as H&R Block and every CPA and accountant in every small
town in America. None of these competitors offer a full range of financial
products for the middle-income segment, and none of them use data gathering and
the Internet to build a long-term relationship with the customers.
MANAGEMENT SUMMARY
JOHN JONES, PRESIDENT / CEO
More than twenty-seven years success as manager and administrator in some of the
country's premiere fortune 500 companies as well as President and owner of
several acquisitions including MIRADOR'S current marketing program. Through Mr.
Jones' experience in marketing, acquisitions and leverage buyouts MIRADOR will
realize its full potential and accomplish its mission. As a licensed insurance
agent of JONES FINANCIAL SERVICES, Mr. Jones became a Regional Account Manager.
Mr. Jones accomplished over five years experience with the coordination,
implementation and servicing of new and existing accounts, introducing new
products as well as product updates; has trained over 250 agents to utilize
computer generated financial needs analysis and all fields of sales and
marketing of Life, Health, Disability, HMO, Home and Auto Insurance Products.
Through the computer generated financial needs analysis developed system to
generate mortgage sales using creative refinancing strategies involving debt
consolidation.
ELROY "GENE" GRAVELY, VICE PRESIDENT
Co-Founder of California Finance Express, with 27 years mortgage and marketing
experience. Former Western Vice President for Empire of America retail division.
Second Vice President of Gill Mortgage Los Angeles Division. Responsible for
development and implementation of marketing and origination strategies in
specialized areas as FHA/VA Fannie Mae and HUD.
ANTHONY MARTINS, JR. CHIEF FINANCIAL OFFICER
Accomplished bank executive offering an impressive record of achievement with
major commercial banks. A profit oriented individual who is accustomed to
challenges and achieving results.
PROFESSIONAL EXPERIENCE
Commercial loan officer generated new loans from commercial developers, the
corporate sector market (privately held and public companies) providing domestic
and international finance products as well as private banking. Additional
responsibilities included reviewing the loan portfolio of BANKS acquired
(documentation update, rating adjustments and re-structuring loans where
applicable). Marketing and new business development officer for Palm Beach and
Broward Counties. Significantly increased branch=s loan portfolio including
business and consumer credits, commercial and residential mortgages, loans to
builders, developers, importers, exporters, manufacturers, retailers and
wholesalers. Private banking specialist focusing on structuring complex credits
to high net worth individuals and the corporate sector market as well as selling
special services including non-asset products. Established Bank's loan
administration and legal documentation departments. Streamlined turnaround time
for credit approvals from 40 to 5 working days. Created marketing program
focusing on US$10M to US$15M lines of credit to Fortune 1000 as well as U.S.
subsidiaries of German companies. Responsible for over US$200M in new lines of
credit. Corporate re-structuring, installing credit and collection programs
thereby providing better management of receivables Implemented marketing
strategies concerning customers in Latin and South America. Improved bank
relationships, maximized on balance sheet availability as well as off-balance
sheet financing. Improved cash balance investment return.
Relationship Manager for 24 U.S. multi-national corporations.
1. Co-Managed Black & Decker's US$3.8B acquisition of Emhart Corporation (CT).
2. Co-Managed Beazer PLC (U.K.) US$1.2B purchase of Cooper's Inc. (PA).
3. Consistently met ROA targets and asset sale goals.
4. Negotiated US$25M FINEX/FOMEX lines for Black & Decker's Brazilian
manufacturing facility.
5. Managed US$8M Term Loan and US$10M Operating Line to Alcoa Aluminio
(Brazil).
6. Established US$15M (total US$150M) Standby LOC for C/P back up for General
Motors de Mexico
and a US$10M pre-export finance line to General Motors do Brazil.
7. Increased portfolio 33% to $1.3 billion.
8. Restructured a substantial portion of bank's loan portfolio.
9. Centralized lending activities of bank's eight branches, replacing 15
positions with 5.
10. Established training programs for 102 staff members including
credit/lending, operations and cross selling.
11. Designed and implemented marketing programs to re-establish bank's position
in the community.
12. Accomplishments resulted in shareholder's stock rising from $2.00 to $12.00
per share.
JIM CLARE, VICE PRESIDENT,
More than 25 years of mortgage and marketing experience. Co-founder of mortgage
banking consulting firm which established and managed retail and wholesale loan
origination branches in the Mid-Atlantic region for several lenders, including
units of source One, Ramsay Mortgage and University Mortgage. Responsible for
development and implementation of marketing and origination strategies in
specialized areas as FHA/VA streamlined refinancing, Title I home improvement
lending and sub-prime home equity lending.
LINDA RAYNELL, CORPORATE SECRETARY AND VICE PRESIDENT, HUMAN RESOURCES
With over twenty years managing corporate recruitment with a major fortune 500
company Ms. Raynell has placed top corporate executives throughout the world.
Ms. Raynell's experience includes extensive interface with foreign consulates
involving visas, immigration and relocation of management and their families. As
manager of over 500 employees Ms. Raynell implemented and obtained the
corporation's ISO 9002 Quality Program for the employment services division. Her
knowledge of corporate building and mass recruiting service infrastructure
brings together MIRADOR'S executive management team.
JEANNINE SPANOLIOS, VICE PRESIDENT
With more than ten years experience in mortgage services and consistency as top
producer and administrator. Currently oversees more than 30 loan officers, four
loan processors and several administrative personnel.
- ------------------------------------