Exhibit 10.2
SEVENTH MODIFICATION AGREEMENT TO
BORROWING BASE REVOLVING
LINE OF CREDIT AGREEMENT
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DATE:
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As of
March 12, 2008
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PARTIES:
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Borrower:
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WILLIAM LYON HOMES, INC., a
California corporation
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Guarantor:
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WILLIAM LYON HOMES, a Delaware
corporation
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Bank:
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JPMORGAN CHASE BANK, N.A.
(successor by merger to Bank One, NA
(Main Office Chicago, Illinois)), a
national
banking association
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JPMORGAN CHASE BANK, N.A. (successor
by merger to Bank One, NA (Main Office Chicago, Illinois)), a
national banking association (“ Bank ”), and
WILLIAM LYON HOMES, INC., a California corporation (“
Borrower ”), hereby enter into this Seventh
Modification Agreement (the “ Modification ”) to
the Borrowing Base Revolving Line of Credit Agreement dated as of
June 28, 2004, as modified by a Modification Agreement, dated
as of December 7, 2004, by a Second Modification to Borrowing
Base Revolving Line of Credit Agreement, dated as of July 14,
2005, by a Third Modification to Borrowing Base Revolving Line of
Credit Agreement, dated as of October 23, 2006, by a Fourth
Modification to Borrowing Base Revolving Line of Credit Agreement,
dated as of April 26, 2007, by a Fifth Modification to
Borrowing Base Revolving Line of Credit Agreement, dated as of
November 6, 2007, and by a Sixth Modification to Borrowing
Base Revolving Line of Credit Agreement, dated as of
February 20, 2008 (the “ Loan Agreement ”),
with the consent of guarantor WILLIAM LYON HOMES, a Delaware
corporation (“ Guarantor ”).
RECITALS
A. Bank has extended to Borrower
credit (“ Loan ”) up to the maximum principal
amount of Seventy Million Dollars ($70,000,000) pursuant to the
Loan Agreement, as presently evidenced by that certain Amended and
Restated Promissory Note dated as of July 14, 2005 (the
“ Note ”) executed by Borrower and payable to
the order of Bank.
B. The Loan is secured by, among
other things, certain Construction Deeds of Trust and Fixture
Filing (With Assignment of Rents and Security Agreement) executed
by Borrower as Trustor for the benefit of Bank (such Deeds of
Trust, as amended to dated, shall be hereinafter referred to,
individually, as a “ Deed of Trust ” and,
collectively, as the “ Deeds of Trust ”). The
Loan is further secured by the personal
property described in certain UCC-1 Financing
Statements relating to the property encumbered by the Deeds of
Trust naming Borrower as Debtor and Bank as Secured Party (as
amended to date, the “ UCC Financing Statements
”). The Deeds of Trust, the UCC Financing Statements, and
such other agreements, documents and instruments securing the Loan
are referred to individually and collectively as the “
Security Documents ”).
C. Repayment of the Loan and the
completion of the improvements have been, and continue to be,
guaranteed by the Repayment Guaranty dated as of June 28, 2004
and executed by Guarantor in favor of Bank (the “
Guaranty ”). The Guaranty and any other agreements,
documents and instruments guarantying the Loan are referred to
individually and collectively as the “ Guaranty
Documents ”.
D. The Loan Agreement, the Note, the
Security Documents, the Guaranty Documents, any environmental
certification and indemnity agreement, and all other agreements,
documents, and instruments evidencing, securing, or otherwise
relating to the Loan, as may be amended, modified, extended or
restated from time to time, are sometimes referred to individually
and collectively as the “ Loan Documents ”.
Hereinafter, the Loan Documents shall mean such documents as
modified in this Modification.
E. The Borrower and the Bank have
agreed to modify the Loan as provided herein.
F. All capitalized terms used herein
and not otherwise defined shall have the meanings given to such
terms in the Loan Agreement.
AGREEMENT
For good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged,
Borrower and Bank agree as follows:
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1.
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ACCURACY OF
RECITALS .
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Borrower acknowledges the accuracy
of the Recitals.
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2.
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MODIFICATION
OF LOAN DOCUMENTS .
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2.1 The Pricing Schedule set forth
in Exhibit C of the Loan Agreement is deleted in its entirety and
replaced with the Pricing Schedule attached hereto as
Appendix I.
2.2 The Deeds of Trust are modified
to secure payment and performance of the Loan as amended to date,
in addition to all other “ Obligations ” of
Borrower as therein defined. The foregoing notwithstanding, certain
obligations continue to be excluded from the Obligations, as
provided in the Deeds of Trust.
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2.3 Each of the Loan Documents is
modified to provide that it shall be a default or an event of
default thereunder if Borrower shall fail to comply with any of the
covenants of Borrower herein or if any representation or warranty
by Borrower herein or by any guarantor in any related Consent and
Agreement of Guarantor is materially incomplete, incorrect, or
misleading as of the date hereof.
2.4 Each reference in the Loan
Documents to any of the Loan Documents shall be a reference to such
document as modified herein.
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3.
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RATIFICATION
OF LOAN DOCUMENTS AND COLLATERAL .
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The Loan Documents are ratified and
affirmed by Borrower and shall remain in full force and effect as
modified herein. Any property or rights to or interests in property
granted as security in the Loan Documents shall remain as security
for the Loan and the obligations of Borrower in the Loan
Documents.
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4.
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CONDITIONS
PRECEDENT .
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Before this Agreement becomes
effective and any party becomes obligated under it, all of the
following conditions shall have been satisfied at Borrower’s
sole cost and expense in a manner ac
