THIRD AMENDMENT TO LOAN AND
SECURITY AGREEMENT
This THIRD AMENDMENT TO LOAN AND SECURITY
AGREEMENT (“Amendment”), dated August 7, 2008, but
effective as of June 30, 2008, is among Resource America, Inc. , a
Delaware corporation (“Borrower”), TD BANK, N.A
. (successor by merger to Commerce Bank, N.A.), a national banking
association, in its capacity as agent (“Agent”), TD
BANK, N.A . (successor by merger to Commerce Bank, N.A.), a
national banking association, in its capacity as issuing bank
(“Issuing Bank”) and each of the financial institutions
which are now or hereafter identified as Lenders on Schedule A (as
such Schedule may be amended, modified or replaced from time to
time) attached to the Loan Agreement (as defined below), (each
such financial institution, individually each being a
“Lender” and collectively all being
“Lenders”).
BACKGROUND
A. Pursuant
to the terms of a certain Loan and Security Agreement dated May 24,
2007 among Borrower, Agent and Lenders (as the same has been or may
be supplemented, restated, superseded, amended or replaced from
time to time, the “Loan Agreement”), Lenders made
available to Borrower, inter alia , a revolving line of
credit not to exceed Seventy Five Million Dollars ($75,000,000)
(the “Loans”). All capitalized terms used
herein without further definition shall have the respective meaning
set forth in the Loan Agreement and all other Loan
Documents.
B. The
Loans are secured by, inter alia , continuing
perfected security interests in the Collateral.
C. An
Event of Default exists under the Loan Agreement, and Borrower has
requested Lenders’ waiver of such Event of
Default. Lenders have agreed to waive such Event of
Default in accordance with and subject to the satisfaction of the
conditions hereof.
D. Borrower
has requested that Agent and Lenders also modify, in certain
respects, the terms of the Loan Agreement and Agent and Lenders
have agreed to such modifications in accordance with and subject to
the satisfaction of the conditions hereof.
NOW, THEREFORE, with the foregoing Background
incorporated by reference and intending to be legally bound hereby,
the parties agree as follows:
1.
Waiver of Existing Default . Borrower
acknowledges that Borrower failed to maintain the minimum
Consolidated Net Worth required under Section 6.8(a) of the Loan
Agreement for the fiscal quarter ending June 30, 2008 (the
“Existing Default”) and that such failure constitutes
an Event of Default under the Loan Agreement. Upon
satisfaction of each of the Effectiveness Conditions set forth in
Section 8 of this Amendment, Lenders shall be deemed to have waived
the Existing Default as of the date of this
Amendment. Lenders’ waiver of the Existing Default
shall in no way be construed as an agreement to waive any Default
or Event of Default that may have occurred prior to the date hereof
other than the Existing Default nor to waive any Default or Event
of Default arising after the date hereof, and Agent and Lenders
reserve all rights and remedies under the Loan Agreement and the
Loan Documents as to any Default or Event of Default other than the
Existing Default. The granting of the waiver of
the
Existing Default under this Amendment shall not
be construed as a course of conduct or dealing on the part of Agent
and Lenders.
2.
Amendments to Loan Agreement .
a. Section
1 of the Loan Agreement shall be amended by deleting the definition
of Maximum Revolving Credit Amount and replacing it as
follows:
Maximum
Revolving Credit Amount – Subject to Section 2.9(b), the aggregate
sum of each Lender’s Revolving Credit Pro Rata Share, which
in no event shall exceed in the aggregate:
(a) from August
7, 2008 through September 29, 2008, Sixty Million Dollars
($60,000,000);
(b) from
September 30, 2008 through December 30, 2008, Fifty-Five Million
Dollars ($55,000,000);
(c) from
December 31, 2008 through March 30, 2009, Forty-Five Million
Dollars ($45,000,000); and
(d) After March
30, 2009, Thirty Million Dollars ($30,000,000); provided that
notwithstanding any other provision of this Agreement, after March
30, 2009, the Revolving Credit Pro Rata Share of U.S. Bank,
National Association shall be reduced to Zero Dollars ($0) and U.S.
Bank, National Association shall no longer be a Lender under this
Agreement. .
b. Schedule
A to the Loan Agreement shall be replaced in its entirety with
Schedule A as attached to this Amendment.
c. Section
6.8 of the Loan Agreement shall be amended by deleting subsection
(a) and replacing it as follows:
(a) Consolidated Net Worth
- Borrower shall maintain at all
times Consolidated Net Worth, to be tested quarterly at the end of
each fiscal quarter, of not less than the following amounts for the
following periods:
June 30, 2008
through September 29,
2008 $150,000,000
September 30, 2008 through September 29,
2009 $170,000,000
September 30, 2009 through September 29,
2010 $180,000,000
September 30, 2010 through September 29,
2011 $190,000,000
September 30, 2011 through September 29,
2012 $200,000,000
3.
Further Amendments . Each of Borrower and Lenders, as
consideration for the waiver of the Existing Default, hereby agree
to negotiate in good faith a future amendment (the “Future
Amendment”) to Section 6.8(a) of the Loan Agreement, and to
execute and deliver such Future Amendment, along with
Borrower’s payment of all of Agent’s expenses and such
other
items as Agent may reasonably require in
connection with the preparation, execution and delivery of the
Future Amendment, to Agent no later than sixty (60) days after the
date hereof.
4.
Representations and Warranties . Borrower
warrants and re
