EXHIBIT 10.5
GUARANTY
THIS GUARANTY (“
Guaranty ”) is made on September 11, 2007, by
Origen Servicing, Inc., a Delaware corporation, and Origen
Financial, Inc., a Delaware corporation (“ Guarantors
”), in favor of William M. Davidson Trust u/a/d 12/13/04
(“ Lender ”), to induce Lender to make loans to
Origen Financial L.L.C., a Delaware limited liability company
(“ Borrower ”), pursuant to that certain Senior
Secured Loan Agreement, of even date herewith, between Borrower and
Lender (the “ Loan Agreement ”), and because
Guarantors have determined that executing and delivering this
Guaranty is in Guarantors’ interest and to Guarantors’
financial benefit.
GUARANTORS AGREE AS FOLLOWS:
1. Guarantee . Until
such time as the Indebtedness (defined below) is fully paid,
Guarantors jointly and severally guarantee to Lender the full and
prompt payment when due of the indebtedness due Lender under or
evidenced by the following promissory notes each of even date
herewith (collectively, the “ Notes ”):
(a) Senior Secured Promissory
Note in the original principal amount of $10,000,000; and
(b) Senior Secured Convertible
Promissory Note in the original principal amount of
$5,000,000;
together
with expenses, costs and reasonable attorneys’ fees, incurred
by Lender in connection with the enforcement of this Guaranty (the
“ Indebtedness ”). Notwithstanding any other
provision of this Guaranty to the contrary, the maximum liability
of each Guarantor hereunder shall be limited to ninety-five percent
(95.00%) of the difference between (a) the present fair
salable value of such Guarantor’s assets as of the date of
this Guaranty, and (b) the amount of all liabilities of such
Guarantor, including probable exposure under contingent liabilities
(including this Guaranty), as of such date. Lender may have
immediate recourse against Guarantors for full and immediate
payment of the Indebtedness at any time when the Indebtedness, or
any portion, has not been paid when due (whether by acceleration or
otherwise), subject to applicable grace and cure periods. All
payments by Guarantors shall be made in lawful money of the United
States of America and in immediately available funds.
2. Nature of Guarantee .
This is a guarantee of payment and not of collection. At any time
when the Indebtedness, or any portion thereof, has not been paid
when due (whether by acceleration or otherwise), but subject to
applicable grace and cure periods, Lender can require that
Guarantors pay Lender the amounts owing under this Guaranty
immediately, and Lender is not required to collect first from the
Borrower, any collateral or any other person liable for the
Indebtedness. No delay or stay in any acceleration of the
Indebtedness, as against the Borrower, due to the application of
any bankruptcy, insolvency or other law or proceeding shall be
effective under this Guaranty and Guarantors agrees to pay
immediately any amount of the Indebtedness that
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