|
Exhibit
10.4
GUARANTY
AGREEMENT
THIS GUARANTY AGREEMENT,
dated as of December 29, 2004, (as amended, supplemented and
otherwise modified from time to time, this “ Guaranty
”), is made by and between NEW CENTURY FINANCIAL CORPORATION
(together with its successors and permitted assigns, the “
Guarantor ”) and CITIGROUP GLOBAL MARKETS REALTY CORP.
(the “ Lender ”), party to the Master Loan and
Security Agreement referred to below.
RECITALS
WHEREAS, pursuant to the
Amended and Restated Master Loan and Security Agreement, dated as
of December 29, 2004 (as amended, supplemented or otherwise
modified from time to time, the “ Loan Agreement
”), among NC Capital Corporation, (the “
Borrower ”), New Century Mortgage Corporation (the
“ Servicer ”), New Century Financial Corporation
(the “ Guarantor ”) and Citigroup Global Markets
Realty Corp. (the “ Lender ”), the Lender has
agreed to provide financing to the Borrower to purchase Eligible
Assets; and
WHEREAS, as of the date
hereof, the Borrower is an indirect wholly-owned subsidiary of the
Guarantor, and the Guarantor will therefore derive a substantial
direct and indirect benefit from the Lender’s providing
financing to the Borrower pursuant to the Loan Agreement. For good
and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the Guarantor has agreed (subject to
certain limitations) to guaranty the Borrower’s obligations
with respect to the Loan Agreement and the documents referenced
therein.
NOW, THEREFORE, for good and
valuable consideration, receipt of which by the parties hereto is
hereby acknowledged, the parties hereto hereby agree as
follows:
1. Defined Terms
.
(a) Unless otherwise defined
herein, terms defined in the Loan Agreement and used herein shall
have the meanings given to them in the Loan Agreement.
(b) “ Expiration
Date ” shall have the meaning set forth in Section 2(d)
herein.
(c) “
Obligations ” shall mean the obligations and
liabilities of the Borrower and the Guarantor to the Lender,
including, without limitation, the obligations whether direct or
indirect, absolute or contingent, due or to become due, or now
existing or hereafter incurred, which may arise under, or out of or
in connection with the Loan Agreement, this Guaranty or any other
document made, delivered or given in connection therewith or
herewith, whether on account of covenants, reimbursement
obligations, fees, indemnities, costs, expenses (including, without
limitation, all fees and disbursements of counsel to the Lender
that are required to be paid by the Borrower pursuant to the terms
of the Loan Agreement) or otherwise.
-1-
(d) The words
“hereof”, “herein” and
“hereunder” and words of similar import when used in
this Guaranty shall refer to this Guaranty as a whole and not to
any particular provision of this Guaranty, and section and
paragraph references are to this Guaranty unless otherwise
specified.
(e) The meanings given to
terms defined herein shall be equally applicable to both the
singular and plural forms of such terms.
2. Guaranty
.
(a) The Guarantor hereby,
unconditionally and irrevocably, guarantees to the Lender and its
successors, indorsees, transferees and assigns the prompt and
complete payment and performance by the Borrower when due (whether
at the stated maturity, by acceleration or otherwise) of the
Obligations.
(b) The Guarantor further
agrees to pay any and all expenses (including, without limitation,
all reasonable fees and disbursements of counsel) which may be paid
or incurred by the Lender in enforcing any rights with respect to,
or collecting, any or all of the Obligations and/or enforcing any
rights with respect to, or collecting against, the Guarantor under
this Guaranty. This Guaranty shall remain in full force and effect
until the Obligations are paid in full, notwithstanding that from
time to time prior thereto the Borrower may be free from any
Obligations.
(c) The Guarantor agrees that
the Obligations may at any time and from time to time exceed the
amount of the liability of the Guarantor hereunder without
impairing this Guaranty or affecting the rights and remedies of the
Lender hereunder.
(d) No payment or payments
made by the Borrower, the Guarantor, any other Guarantor or any
other Person or received or collected by the Lender from the
Borrower, the Guarantor, any other guarantor or any other Person by
virtue of any action or proceeding or any set-off or appropriation
or application at any time or from time to time in reduction of or
in payment of the Obligations shall be deemed to modify, reduce,
release or otherwise affect the liability of the Guarantor
hereunder which shall, notwithstanding any such payment or payments
other than payments made by the Guarantor in respect of the
Obligations or payments received or collected from the Guarantor in
respect of the Obligations remain liable for the Obligations up to
the maximum liability of the Guarantor hereunder until the
Obligations paid in full and the Loan Agreement is terminated (such
date, the “ Expiration Date ”).
(e) The Guarantor agrees that
whenever, at any time, or from time to time, it shall make any
payment to the Lender on account of its liability hereunder, it
will notify the Lender in writing that such payment is made under
this Guaranty for such purpose.
3.
[Reserved]
-2-
4. Representations and
Warranties of the Guarantor . The Guarantor hereby
represents and warrants that:
(a) It is duly organized and
validly existing in good standing under the laws of the
jurisdiction under which it is organized and is duly qualified to
do business and is in good standing in every other jurisdiction as
to which the nature of the business conducted by it makes such
qualification necessary.
(b) It has the full power,
authority and legal right to execute, deliver and perform its
obligations under this Guaranty. This Guaranty has been duly
authorized, executed and delivered by it, has not been amended or
otherwise modified, is in full force and effect and is the legal,
valid and binding obligation of the Guarantor, enforceable against
it in accordance with its terms, except as may be limited by
bankruptcy, insolvency, reorganization, moratorium or other similar
laws relating to or affecting the rights of creditors generally and
to the application of general principles of equity (regardless of
whether considered in a proceeding in equity or at law).
(c) Neither the execution and
delivery of this Guaranty nor the consummation of the transactions
contemplated herein will conflict with or result in a breach of, or
require any consent under, any applicable law or regulation, or any
order, writ, injunction or decree of any court or governmental
authority or agency, or any material agreement or instrument to
which the Guarantor is a party or by which the Guarantor or its
property is bound or to which the Guarantor is subject, or
constitute a default under any such material agreement or
instrument, or (except for the liens created pursuant hereto)
result in the creation or imposition of any lien or encumbrance
upon the Guarantor’s revenues or assets pursuant to the terms
of any such material agreement or instrument.
(d) It has received and
reviewed copies of the Loan Agreement.
(e) There is no action, suit
or proceeding at law or in equity by or before any governmental
authority, arbitral tribunal or other body now pending, or to the
best of the Guarantor’s knowledge, threatened against or
affecting the Guarantor or its property that has a reasonable
likelihood of having a material adverse effect on the
Guarantor’s condition, financial or otherwise.
(f) No authorizations,
approvals or consents of, and no filings or registrations with, any
governmental authority are necessary for the execution, delivery or
performance by the Guarantors of this Guaranty.
(g) In exchange for the
guaranty hereunder, it will derive a benefit from the Lender
providing financing to the Borrower.
(h) It is solvent on the date
hereof.
(i) It is a qualified real
estate investment trust (“REIT”) under Section 856 of
the Internal Revenue Code of 1986, as amended and it is in
compliance with all provisions of the Code governing its REIT
status.
-3-
5. Covenants of the
Guarantor .
5.01 The Guarantor covenants
and agrees that:
(a) It shall pay and
discharge all taxes now or hereafter imposed on it, on its income
or profits, on any of its property or upon the liens provided
herein prior to the date on which penalties attach thereto; it
shall promptly pay any valid, final judgment enforcing any such tax
and cause the same to be satisfied of record and shall also pay, or
cause to be paid, when due all claims for labor, material, supplies
or services that, if unpaid, could by law result in a
mechanics’ lien.
(b) It shall notify the
Lender promptly upon obtaining knowledge of any material action,
suit or proceeding at law or in equity by or before any government
authority, arbitral tribunal or other body pending or threatened
against it or the Borrower.
(c) It will take all steps
necessary to maintain its status as a REIT.
6. Right of
Set-off . Upon the occurrence of any Event of Default, the
Guarantor hereby irrevocably authorizes the Lender or any of its
Affiliates at any time and from time to time without notice to the
Guarantor, any such notice being expressly waived by the Guarantor,
to set-off and appropriate and apply any and all deposits (general
or special, time or demand, provisional or final), in any currency,
and any other credits, indebtedness or claims, in any currency, in
each case whether direct or indirect, absolute or contingent,
matured or unmatured, at any time held or owing by the Lender or
any of its Affiliates to or for the credit or the account of the
Guarantor, or any part thereof in such amounts as the Lender may
elect, against and on account of the obligations and
liabilities
|
