Exhibit 10(a)
SECOND AMENDED AND RESTATED
LOAN PARTICIPATION AGREEMENT
This Second
Amended and Restated Loan Participation Agreement (this
“Agreement”) is made and entered into as of
March 30, 2004, between The Huntington National Bank
(“Transferor”) and Huntington Preferred Capital
Holdings, Inc. , an Indiana corporation
(“Transferee”).
RECITALS
A. The
parties have previously entered into a certain Amended and Restated
Loan Participation Agreement, dated as of May 12, 2003 (the
“Original Agreement”), whereby Transferor has
transferred and will continue to transfer to Transferee
participation interests in certain loans (the “Loans”)
made by Transferor or an affiliate of Transferor to various
borrowers (collectively, the “Borrowers”), as such
Loans have been and may be identified from time to time by
Transferor pursuant to Section 2 below, or substituted for
other Loans previously transferred by Transferor to Transferee,
pursuant to such Section 2.
B. The
parties desire to amend and restate the Original
Agreement.
AGREEMENT
1. Definitions.
(a) “Loan
Documents” shall mean any and all loan agreements evidencing
or otherwise relating to any of the Loans, together with any and
all commitment letters, promissory notes, real estate mortgages,
assignments and security agreements, financing statements, pledge
agreements, letters of credit, applications and agreements for
standby letters of credit, letter of credit reimbursement
agreements, subordination agreements, waivers, affidavits, fire and
extended coverage insurance policies, guarantees, title insurance
policies, applications, reports, surveys, documents required to be
maintained by lenders pursuant to any applicable federal or state
regulations, any and all amendments, modifications or supplements
to any of the foregoing from time to time, and all other relevant
documents pertaining to any of the Loans.
(b) “Collateral”
shall mean the real property, fixtures, equipment, inventory,
accounts, chattel paper, instruments, documents, general
intangibles, securities and all other property and property rights
in which Transferor has been granted a mortgage, lien or security
interest in connection with any of the Loans.
(c) “Origination
Fees” shall mean the origination, commitment, or other fees
collected at the time of origination of a particular
Loan.
(d) “Participation”
and “Participation Interest” shall mean the interest of
Transferee in the Loans and in the associated Origination Fees,
equal to up to a one hundred percent (100%) interest in each of the
Loans and associated Origination Fees.
(e) “Participation
Share,” “Pro Rata Share,” “pro rata,”
and “ratably” shall mean a share in the same proportion
as the respective percentage ownership interests of Transferor and
Transferee in the Loans and associated Origination Fees.
2. Transfer
of Participation Interests; Substitution of Interests.
(a) Transferee
shall from time to time buy from Transferor or from an affiliate of
Transferor, without recourse, a continuing undivided fractional
Participation Interest, and Transferor shall from time to time sell
to Transferee, or cause an affiliate or affiliates of Transferor to
sell to Transferee, such Participation Interests. The purchase
price for a particular Participation Interest transferred shall be
Transferee’s Participation Share of Transferor’s
carrying value for the Loan, which is the outstanding principal
balance of the Loan and interest earned thereon but not collected,
net of unearned income, if any, less an allowance for loan losses.
Transfers of Participation Interests by Transferor or an affiliate
of Transferor to Transferee hereunder may, upon the mutual
agreement of the parties at the time any such transfers are made,
be made (i) as additional contributions to the capital of
Transferee, (ii) in exchange for the payment of cash by
Transferee to Transferor or appropriate affiliate of Transferor,
(iii) in consideration of the issuance to Transferor or
appropriate affiliate of Transferor of shares of the capital stock
of Transferee, or (iv) for such other consideration as the
parties shall mutually agree.
(b) At
the time of any transfer of a Participation Interest, Transferor
will assign to Transferee, without recourse, Transferee’s
Participation Share of Transferor’s beneficial right, title
and interest in the Loans and associated Origination Fees,
including any Collateral for the Loans, and any uncollected
payments or collections on account of the Loans. Transferor shall
hold title to the Loans, including any Collateral payments and
collections as agent for Transferee.
(c) Upon
the mutual agreement of the parties, Transferor may from time to
time substitute a Participation Interest in a Loan or group of
Loans and the associated Origination Fees (the “New
Loans”) having a fair market value (as determined by the
mutual agreement of the parties) equivalent to the Participation
Interest in a Loan or group of Loans and the associated Origination
Fees previously transferred to Transferee hereunder (the “Old
Loans”), whereupon the Participation Interest previously
granted by Transferor to Transferee in the Old Loans will be
canceled and Transferee shall have a Participation Interest in the
New Loans. Such a substitution may be made as part of a purchase or
other transfer of additional Participation Interests in accordance
with paragraph (a) above. Any amounts payable by Transferor to
Transferee hereunder on account of the Old Loans, prorated through
the date of the substitution, shall be paid by Transferor to
Transferee at the time of such substitution.
(d) Each
of the Loans which shall be subject to this Agreement shall be
(i) identified on a completed “Certificate of
Participation” in the form of Exhibit A attached hereto,
which shall be delivered by Transferor to Transferee and shall
contain at least the name of each Borrower, the date of the
promissory note evidencing each Loan, the original principal amount
of each Loan, the amount of any associated Origination Fees, and
the purchase price associated
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with the same; or
(ii) otherwise identified electronically or in the loan files
for the Loans, in a manner that is mutually agreeable to Transferor
and Transferee and sufficient to properly identify the
Loans.
3. Representations
and Warranties. At the time of transfer of Participation Interests
to Transferee, Transferor represents and warrants that Transferor
has good title to the Loans and has full right, power, and
authority to grant and convey the Participation in the Loans
provided for herein to Transferee, and, at the time of transfer of
Participation Interests to Transferee, the Loans are free and clear
of all encumbrances or other interests of any other
person.
4. Transferee’s
Risk. Transferee acknowledges and agrees that Transferor has made
no representation or warranty and has no responsibility as to: (i)
the collectibility of the Loans; (ii) the Borrowers’
creditworthiness or financial condition; (iii) the legality,
validity, binding effect or enforceability of the Loan Documents;
(iv) the filing, recording or taking of any other action with
respect to the Loan Documents; (v) any other matter having any
relation to the Loans, the Loan Documents, this Agreement, the
Borrowers, or any other person or entity except as otherwise
specifically set forth herein. Transferee acknowledges that
Transferor has made available to it copies of the Loan Documents
requested by Transferee. Transferee acknowledges and agrees that it
has made its own independent investigation and determination with
respect to the foregoing matters and accepts full responsibility
therefor. The sale of the Participation Interests by Transferor to
Transferee pursuant to this Agreement shall be and is without
recourse of any nature.
5. Custody
and Ownership of Loan Documents and Collateral. Transferor shall
have and maintain physical possession of all the Loan Documents and
Collateral, to the extent that possession is necessary to perfect a
security interest in any Collateral. Transferor shall use
reasonable care to safeguard and protect the Loan Documents and
Collateral. Transferor is authorized to deal with the Loans in
Transferor’s own name, subject to the terms and conditions of
this Agreement, and, as far as third parties are concerned, to act
on behalf of Transferee as though Transferor were the sole owner of
the Loans; provided, however, that all of Transferor’s
actions with respect to the Loans will be subject to this
Agreement.
6. Nature of
Transferee’s Participation Interest. Transferee’s
obligations hereunder constitute absolute, unconditional and
continuing obligations to make funds or credit available to
Transferor for Transferor to extend credit to any of the Borrowers
and pay letters of credit issued for the account of any of the
Borrowers pursuant to the terms of the Loan Documents and will be
unaffected by (i) any amendment or waiver of any term of the
Loan Documents, (ii) any extension, overadvance, indulgence,
settlement or compromise granted or agreed to in relation to the
Loan Documents, (iii) the release of any Collateral or any
guaranty of the Loans, (iv) any invalidity, unenforceability,
or insufficiency of the Loan Documents or of any drafts or other
documents submitted in connection with draws under any letters of
credit, (v) any default by or insolvency of any of the
Borrowers, (vi) any act or omission on Transferor’s part
relating to this Agreement or the Loan Documents (absent gross
negligence or willful misconduct), (vii) the absence of notice
to Transferee of any of the foregoing, (viii) any requirement
that Transferor take any action against any of the Borrowers or any
other person liable on the Loans, and (ix) any defenses in law
or equity which Transferee may have to the full discharge of its
obligation under this Agreement (absent gross negligence or willful
misconduct by Transferor).
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7. Servicing
of the Loans. Transferor shall service the Loans on behalf of both
Transferee and Transferor as follows:
(a) Except
as otherwise specifically set forth in this Agreement, Transferor
will perform the servicing for the Loans or will cause an affiliate
of Transferor to service the Loans in a manner substantially the
same as for similar work performed by Transferor on its own behalf.
For this purpose, servicing shall include all communications with
any of the Borrowers and third parties, making of all advances and
issuing of letters of credit provided for under the Loan Documents
(subject to receipt from Transferee of its Parti
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