Exhibit 10.12
ADDENDUM TO CONSTRUCTION LOAN AGREEMENT
CONDOMINIUM AND TOWNHOUSE PROJECT DEVELOPMENT
CONSTRUCTION OF NEW PROJECT
THIS ADDENDUM TO CONSTRUCTION LOAN AGREEMENT ("Addendum") is made as of the
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29 day of December, 2005, by and between KEYBANK NATIONAL ASSOCIATION
("Lender") and TIERRA DEL SOL RESORT (PHASE 1), LTD., a Florida limited
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partnership, TDS TOWN HOMES (PHASE 1), LLC, a Florida limited liability company,
XXXXX XXXXXX I REAL ESTATE, LLC, a Florida limited liability company, TDS
AMENITIES, INC., a Florida corporation (jointly and severally "Borrower").
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Lender and Borrower have entered into a Construction Loan Agreement of even
date herewith (the "Loan Agreement") wherein Lender has agreed to make a
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revolving real estate construction loan (the "Loan") in the maximum principal
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amount of $40,000,000.00 to Borrower under the terms and conditions described
therein.
By the terms of this Addendum Lender and Borrower describe and set forth
the terms and conditions whereby Units (as hereinafter defined) to be
constructed pursuant to the Loan Agreement shall be from time to time released
from the lien of the Mortgage in order that Borrower may sell the Units.
1. ADDITIONAL DEFINITIONS. The following additional "Definitions" shall be
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added to and be a part of Article I of the Loan Agreement. Any capitalized term
used herein shall, if not specifically defined within this Addendum, have the
meaning defined and set forth in the Loan Agreement.
1.1 ADDITIONAL COLLATERAL: Has the meaning set forth in Section 3.6 of
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this Addendum.
1.2 APPROVED SALES PRICE: The Lender's minimum contract sales prices
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for each Unit set forth in EXHIBIT "A" attached hereto.
1.3 ASSIGNMENT OF GOVERNING DOCUMENTS: That certain Conditional
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Assignment of Unit Sales Contracts, Governing Documents and Developer's
Rights executed of even date herewith by Borrower in favor of Lender, as
the same may be amended, supplemented, extended, renewed, replaced and/or
restated from time to time in accordance with its terms
1.4 CERTIFICATE OF UNIT OCCUPANCY: A permanent certificate issued by a
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municipality or an applicable department thereof certifying that all of the
Units, as constructed, may be legally occupied.
1.5 CONDOMINIUM: Xxxxx Xxxxxx I Condominium, a condominium to be
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established in accordance with the Condominium Statute pursuant to the
Condominium Documents.
1.6 CONDOMINIUM DEPOSIT(S): All reservations, deposits, down payments,
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or the like paid under Contracts of Sale or reservation receipts for
Condominium Units at the Project.
1.7 CONDOMINIUM DOCUMENTS: All of the documents required by the
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Condominium Statute or otherwise, relating to the submission of the
applicable portion of the Project to the provisions of the Condominium
Statute or to the regulation, operation, administration or sale thereof
after such submission, including, but not limited to a declaration of
condominium, by-laws and rules and regulations of a condominium association
or associations, Master Association Documents, management agreement, plats
and plans and the of the Contract of Sale and deed forms to be used in
connection with the sale of the Units, all of which must be reasonably
acceptable to Lender in form and substance.
1.8 CONDOMINIUM STATUTE: Chapter 718, Florida Statutes, as it may
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be amended from time to time.
1.9 CONDOMINIUM UNIT(S): Any dwelling unit within the Project
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submitted to the condominium form of ownership under the Condominium
Statute.
1.10 CONTRACT DEPOSITS: the collective reference to Condominium
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Deposits and Townhouse Deposits.
1.11 CONTRACT OF SALE: A legally enforceable contract, in form and
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content satisfactory to Lender and Lender's counsel, between Borrower and a
bona fide third party purchaser for the sale and purchase of an individual
Unit at a sales price of not less than the Minimum Release Price, with a
Contract Deposit of not less than twenty percent (20%) of the total
purchase price of the Unit being sold, which Contract Deposit shall have
been paid and such deposit shall constitute cash or immediately available
funds to the Escrow Agent. All items required to be disclosed to a
purchaser under the Chapter 718, Florida Statutes shall have been delivered
to each purchaser. Without limiting the foregoing requirements, a "Contract
for Sale" shall not include any contracts entered into prior to the
effective date of all necessary filings with the State of Florida and
pursuant to Chapter 718, Florida Statutes. Each contract must by the terms
thereof (i) be expressly inferior and subordinate to the lien of any
mortgage now or hereafter existing which encumbers the Project, (ii) be
non-assignable without the Lender's prior written consent (which written
consent will not be unreasonably withheld or delayed), and (iii) otherwise
comply with all requirements of Governmental Authorities so that the
purchaser of such Unit shall have no election or right to rescind such
contract without the loss of its Contract Deposit. For the purpose of this
Addendum, a purchaser shall not be considered a bona fide third party
purchaser if it has contracted, directly or indirectly, for the purchase of
more than two (2) Units. In addition, no more than two (2) Units may be
purchased by purchasers of multiple units, and no more than thirty-five
(35) Units may be sold to Insiders (as hereinafter defined). Moreover, a
bona fide third party purchaser shall not include the Borrower, any member
or manager of the Borrower, any stockholder, director, officer, partner,
member or manager of any member or manager of Borrower, or any partner,
member manager, stockholder, director or officer of any constituent party
of any member or manager of the Borrower, or any member of the immediate
family or affiliate (as defined in Rule 405 of the Securities Act of 1933)
of any of the foregoing parties (collectively, "Insiders"). Notwithstanding
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any contrary provision of this Section 1.11 or of any other provision of
this Addendum or any other Loan Document, Lender hereby accepts and
approves all Contracts of Sale identified on EXHIBIT "B" attached hereto
and acknowledges that each of such Contracts of Sale identified in EXHIBIT
"B" attached hereto constitute a "Required Contract of Sale" for purpose of
Section 3.3 of this Addendum and an approved Contract of Sale for purposes
of Section 8.1(b) of the Loan Agreement.
1.12 DIVISION: Has the meaning set forth in Section 5.1(b) hereof.
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1.13 ESCROW ACCOUNT: An account maintained with the Escrow Agent at
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KeyBank National Association into which all Contract Deposits are paid
pursuant to this Addendum.
1.14 ESCROW AGENT MEANS A FIRM OR INDIVIDUAL ACCEPTABLE TO LENDER.
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The Escrow Agent approved by Lender is OVT Title Agency, LLC.
1.15 GOVERNING DOCUMENTS: the Condominium Documents as to the
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Condominium Units, and the Master Association Documents as to the fee
simple Townhouse Units.
1.16 LOAN DOCUMENTS: Shall mean, in addition to those set forth in the
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Definitions in the Loan Agreement, this Addendum, and the Assignment of
Governing Documents.
1.17 LOAN-TO-VALUE RATIO: The ratio obtained by dividing the
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outstanding principal balance due on the Loan Amount (as of the testing
date) by the fair market value of the Project as determined by an Appraisal
1.18 MASTER ASSOCIATION: Tierra del Sol Owners' Association, Inc., a
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Florida corporation.
1.19 MASTER ASSOCIATION DOCUMENTS: All of the documents relating to
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the creation, regulation, operation and/or administration of the Master
Association, including the common properties, basic resort services and/or
resort facilities, as defined therein.
1.20 MINIMUM RELEASE PRICE: The Lender's minimum release price for
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each Unit shall be as set forth in EXHIBIT "A" attached hereto.
1.21 NET SALE PROCEEDS: Shall mean the purchase price for each Unit,
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including all amounts paid for extras and the like (excluding, however,
amounts for extras and the like paid for from sources other than Loan
proceeds), less: (i) third party brokerage fees to the extent due from
Borrower; (ii) customary closing costs and adjustments paid by the Borrower
(for documentary stamp tax, recording fees and taxes, etc.); and (iii) any
purchase deposits approved for use in the Project.
1.22 RELEASE PRICE: The greater of (i) 100% of Net Sales Proceeds for
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an applicable Unit; or (ii) the Minimum Release Price.
1.23 REQUEST FOR PARTIAL RELEASE: Shall have the meaning set forth in
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Section 6.3(c) hereof
1.24 REQUIRED CONTRACTS OF SALE: Shall have the meaning set forth in
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Section 3.3 hereof.
1.25 TOWNHOUSE DEPOSIT(S): All reservations, deposits, down payments,
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or the like paid under Contracts of Sale or reservation receipts for
Townhouse Units at the Project.
1.26 TOWNHOUSE UNIT(S): Attached dwelling units located within the
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Project constructed, or to be constructed, on a lot not submitted to
condominium ownership.
1.27 UNIT OR UNITS: Means (i) the Condominium Units located within the
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Project, and (ii) the Townhouse Units located within the Project.
2. ADDITIONAL REPRESENTATIONS AND WARRANTIES. In addition to the
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Representations and Warranties of Borrower set forth in Section 3 of the Loan
Agreement, Borrower hereby represents and warrants to Lender:
2.1 CONTRACTS OF SALE. All of the Contracts of Sale identified on
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EXHIBIT "B", attached hereto, are in full force and effect and are valid
and subsisting; to the best of Borrower's knowledge there are no defaults
thereunder or any defenses or offsets thereto on the part of any purchaser
thereunder and no notice has been received from any purchaser claiming any
default by the Borrower, as seller, thereunder or requesting a termination
thereof. No modifications or amendments have been made to any of such
Contracts of Sale except as previously disclosed in writing to Lender and
no agreements are in existence, oral or written, which would or could
modify the obligations of the Borrower, as seller, or the purchasers
thereunder. Except as disclosed to Lender, Borrower has neither committed
nor suffered any act or omission which would or could constitute a default
on its part entitling any purchaser to damages, rights of set-off or right
to terminate any Contract of Sale. EXHIBIT "B" accurately identifies all
Contract Deposits paid by the purchasers under Contracts of Sale and all
Contract Deposits for Condominium Units only are being held, pursuant to
the form of escrow agreement(s) previously approved by Lender in separate
Escrow Account(s) under the exclusive control of the Escrow Agent, which
Escrow Account(s) meet all of the requirements of the provisions of this
Addendum.
2.2 CONDOMINIUM DOCUMENTS. To the extent such approval is required,
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the Condominium Documents have been approved by all applicable federal,
state or local governmental agencies or entities with approval authority
over such documents, and Borrower agrees to maintain such approvals in good
standing throughout the term of the Loan.
3. ADDITIONAL COVENANTS. In addition to the covenants of Borrower set forth
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in Section 15 of the Loan Agreement, Borrower hereby agrees and promises as
follows:
3.1 EXPENSES. In addition to the fees and expenses of Lender agreed to
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be paid by Borrower under the Loan Agreement, Borrower shall pay (promptly
upon the rendering of such a xxxx and delivery thereof to Borrower) all
reasonable out-of-pocket expenses incurred by the Lender in connection with
the review of any proposed easements, final approval and recordation of the
Governing Documents, partial releases, and satisfaction of a loan of
character contemplated hereby.
3.2 LEASE OF PROJECT. Except for leases of Units pursuant to
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Borrower's plan to operate the Project as a resort, Borrower will not
lease, sublease, license or grant any occupancy arrangement with respect to
the Project, without the prior written consent of Lender except as
otherwise expressly permitted under the Loan Agreement, Mortgage and the
Assignment of Leases.
3.3 CONTRACTS OF SALE. Prior to the initial disbursement of Loan
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proceeds (other than initial closing expenses), Borrower shall deliver to
Lender Contracts for Sale for at least thirty-three (33) of the thirty-six
(36) Units contained in each building to be constructed which shall produce
aggregate Net Sale Proceeds sufficient to cover 120% of the maximum
aggregate funding permitted under the Loan and with each sales price being
otherwise acceptable to Lender based on Lender's underwriting analysis (the
"Required Contracts of Sale"). If at any time the foregoing requirement is
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not satisfied, such failure shall constitute an Event of Default hereunder
and under the Loan Agreement unless the Borrower provides to Lender
substitute Contracts for Sale of equal or greater purchase prices within
thirty (30) days of the occurrence of such failure. Borrower shall not
modify, amend, cancel, rescind, extend, terminate, or otherwise change in
any manner any Contract of Sale without the prior written consent of the
Lender. Additionally, Borrower shall not enter into any new Contract of
Sale with a purchase price less than the Approved Sales Price. Furthermore,
Borrower shall not enter into any new Contract of Sale that will require a
modification to the Plans, the cost of which exceeds five percent (5%) of
the Approved Sales Price for such Unit. All Contracts of Sale must include
a delivery date that can be achieved in accordance with the Construction
Schedule. Additionally, a matrix must be approved by Lender that
demonstrates on a Unit-by-Unit basis that each Unit under a Contract of
Sale will be delivered within twenty-four (24) months from the date of the
Contract of Sale. No extension of such contracts may be made without
Lender's approval.
3.4 GOVERNING DOCUMENTS. Borrower shall not modify, amend, or
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otherwise change (including without limitation, any change that would
permit any purchaser to cancel its respective Contract of Sale) in any
manner the Governing Documents without the prior written consent of the
Lender (which written consent will not be unreasonably withheld or
delayed). Borrower covenants and agrees that it shall comply with, to the
extent applicable to the Project, (a) all requirements of the Division, (b)
all regulations promulgated from time to time by the State of Florida,
pursuant thereto, including without limitation, the filing requirements for
the Governing Documents (as applicable), and Borrower's obligations as
developer of the Condominium and the Townhouse Units, and (c) all
requirements and requests of the Division in connection with the filing of
the Declaration and the United States Department of Housing and Urban
Development. The Borrower shall pay in respect of any Units on or before
the expiration of any applicable grace or cure period all common expenses,
charges and assessments, special or general, and other items for the
payment of which the Borrower is or may hereafter be responsible under the
terms of the Governing Documents.
3.5 ESCROW DEPOSITS. Except as may otherwise be required by
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Governmental Authorities, all Contract Deposits for the Condominium Units
shall be deposited into Escrow Account(s) maintained by the Escrow Agent at
KeyBank National Association. Borrower shall be responsible for all of the
costs of such Escrow Account(s), including, without limitation, all of
Escrow Agent's fees and the like. Borrower shall place or caused to be
placed all Contract Deposits for the Condominium Units in the Escrow
Account subject to the return of such Contract Deposit to a purchaser
(including, to the extent of such purchaser's rights thereto, accrued
interest on such Contract Deposit), when required by the terms of any
Contract of Sale to be paid over to the purchaser, and subject to the
payment of each such Contract Deposit for the Condominium Units to the
Lender on account of the amount to be paid to the Lender to release Units
from the lien of the Mortgage, as and when title to a Unit is transferred
to a purchaser and the balance of the consideration paid therefor. As and
when any purchaser defaults under the terms of any Contract of Sale and
Lender determines that purchaser has no claim for the return of the
Contract Deposit such Contract Deposit for the Condominium Units shall be
paid to the Lender on account of then outstanding principal balance of the
Loan to the extent it was not previously released from escrow and used for
construction of the Project.
4. EVENTS OF DEFAULT
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4.1 ADDITIONAL EVENTS OF DEFAULT. In addition to the Events of
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Default set forth in Article 19 of the Loan Agreement, the
following shall constitute an "Event of Default" under the Loan Agreement
and hereunder:
(a) Borrower fails to maintain the Required Contracts of Sale in
accordance with Section 3.3 of this Addendum, subject to the grace
period contained therein.
4.2 ADDITIONAL LENDER'S REMEDIES. Upon the happening of an Event of
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Default under this Addendum or the Loan Agreement, in addition to any other
rights and/or remedies available to Lender under the Mortgage, the
Guaranty, this Addendum, the Loan Agreement, the other Loan Documents or by
law, Lender shall be entitled to and Borrower shall make no objection to
Lender's sale of Units pursuant to the terms of the applicable Contract of
Sale.
4.3 LENDER AS ATTORNEY-IN-FACT. Borrower hereby constitutes and
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appoints Lender its true and lawful attorney-in-fact with full power of
substitution to complete the Improvements in the name of Borrower, and
hereby empowers said attorney or attorneys as follows: (a) to make such
additions and changes and corrections in the Plans which shall be necessary
or desirable to complete the Improvements in substantially the manner
contemplated by the Plans; (b) to use any funds of Borrower including any
balance which may be held in escrow (to the extent permitted by Law) and
any funds which may remain undisbursed under this Loan Agreement for the
purpose of completing the Improvements in the manner called for by the
Plans as may be modified hereby; (c) to employ such contractors,
subcontractors, Lenders, architects and inspectors as shall be required for
said purposes; (d) to pay, settle or compromise all existing bills and
claims which are or may be liens against the Project or any part thereof,
or may be necessary for the Completion of the Improvements or the clearance
of title; (e) to execute all applications and certificates in the name of
Borrower which may be required by any construction contract; (f) to execute
all documents and instruments in the name of Borrower which may be required
to effectuate a sale of any Unit pursuant to any Contract of Sale; and (g)
to do any and every act with respect to the Construction of the
Improvements which Borrower may do in its own behalf. It is understood and
agreed that this power of attorney shall be deemed to be a power coupled
with an interest which cannot be revoked. Said attorney-in-fact shall also
have power to prosecute and defend all actions or proceedings in connection
with the Construction of the Improvements on the Project and to take such
action and require such performance as is deemed necessary. Borrower hereby
assigns and quitclaims to Lender, effective solely under the foregoing
circumstances, all sums advanced pursuant to either this Addendum or of the
Loan Agreement and all sums in escrow subject to the condition that said
sums, if any, be used for the Completion of the Improvements. Entering the
Project in order to complete the Improvements and/or exercise of the
aforesaid license and/or power-of-attorney will not exclude Borrower from
possession, custody, ownership or control of the Project or Improvements or
of any rents, issues or profits therefrom.
5. ADDITIONAL CONDITIONS PRECEDENT. Borrower acknowledges that Lender shall
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have no obligation under the Loan Agreement or this Addendum to make any Loan
disbursement unless and until the following additional conditions precedent
shall have been satisfied to the extent required by Lender in its sole and
absolute discretion.
5.1 DELIVERIES TO LENDER. Lender shall have received or obtained all
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of the following items, all inform and substance satisfactory to Lender in
all respects:
(a) the duly executed and acknowledged original of the Assignment
of Governing Documents
(b) a complete set of Governing Documents in form and content
satisfactory to Lender, which Governing Documents (as applicable)
shall have been filed with the Division of Florida Land Sales,
Condominiums and Mobile Homes (the "Division") and with every other
Governmental Authority with whom the Condominium Documents are
required to be filed.
(c) as to the Condominium Units, an endorsement to the Title
Policy insuring the valid creation of the Condominium under the
Condominium Documents and the Condominium Statute and a commitment
from a title insurance company satisfactory to the Lender to issue
both owner's and mortgagee's title insurance policies with condominium
endorsements to purchasers of Condominium Units under such Contracts
of Sale;
(d) evidence satisfactory to Lender of the existence of the
Required Contracts of Sale, but Lender shall have no duty to Borrower
or otherwise to conduct any independent investigation concerning such
evidence of such Required Contracts of Sale.
(e) written confirmation from the Escrow Agent that it shall not
release any Contract Deposits as the Condominium Units only without
the Lender's prior written consent until the respective closings of
the sale of the Units unless unequivocally required to do so pursuant
to a Contract of Sale or by judicial order;
(f) an Appraisal which is satisfactory to Lender in all respects
confirming an "as is" value of the Project of $90,700,000.00 and a
Loan-to-Value Ratio of the Project which is not greater than eighty
percent (80%) based upon the Discounted Value of the Units;
(g) an opinion from counsel for Borrower stating (i) that the
Condominium Documents comply with and are sufficient to create a
Condominium if filed in accordance with the Condominium Statute, and
(ii) stating that the Condominium complies with all local zoning and
subdivision requirements; and
(h) an executed counterpart of all Contracts of Sale, in form and
substance reasonably satisfactory to Lender.
6. CREATION OF PROJECT AS CONDOMINIUM, SALE OF CONDOMINIUM UNITS, AND
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PARTIAL RELEASE OF CONDOMINIUM UNITS.
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6.1 JOINDER IN DECLARATION. Borrower is developing and at all times
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shall develop and operate a portion of the Project as a condominium under
the Condominium Documents and the Condominium Statute. Provided that no
Event of Default exists, Lender will join in and consent to the execution
and recording of Borrower's Master Association Documents and Declaration of
Condominium (as well as any amendments thereto), and shall take such other
actions as shall be reasonably necessary to effectively transfer the lien
of the Mortgage from the Project to the Units (as applicable) created and
covered by the Declaration of Condominium, together with their
proportionate share of common elements, and which joinder and consent shall
be provided only upon the fulfillment of each and every of the following
conditions precedent:
(a) Completion of the Improvements and the issuance of
Certificates of Occupancy (or temporary certificate of occupancy) for
all Condominium Units and verification satisfactory to Lender that
closings pursuant to Contracts of Sale are to occur for Condominium
Units within thirty (30) Business days thereafter.
(b) Verification satisfactory to Lender that any required
approval by the fire marshal or its equivalent having jurisdiction
over the Project and any other approval required by any Governmental
Authority, to the extent that any such approval is a condition to the
lawful use and occupancy of the Improvements and the opening of same
to the public, has been obtained.
(c) Verification satisfactory to Lender that the Condominium
Documents have been approved by the Division and by every other
Governmental Authority from whom approval is required, and, without
Lender's prior written consent, have not been materially amended or
modified from the form delivered to Lender prior to the date of this
Loan Agreement without Lender's consent.
(d) Verification satisfactory to Lender that all Condominium
Units shall be sold upon a fee simple basis with no obligatory lease
of any type or any club membership associated in any manner whatsoever
with the condominium regime and the common areas and elements.
(e) Verification satisfactory to Lender that Borrower shall have
instituted no program to offer a rental service of any kind to
purchasers of Units, either individually or in any form of pooling
arrangement, other than as permitted by Lender.
(f) Verification satisfactory to Lender that no "time-share
estate", as said term is defined in Florida Statute 721, shall be
permitted (except as otherwise agreed by Lender or as permitted by the
Condominium Documents).
(g) Lender's receipt of a collateral assignment to Lender (as
further security for the Loan) in recordable form of all of Borrower's
right, title, and interest as developer of the condominium project by
reason of the Florida Statute 718, including the right to appoint the
board of directors of the condominium association and the right to
control the condominium association. Borrower agrees to execute any
other documents requested by Lender in order to evidence such
assignment of its developer's rights in the condominium project to
Lender, and Borrower shall pay for the reasonable cost and expense of
documenting such assignment, including without limitation, all
attorneys' fees and costs associated therewith.
(h) Borrower shall pay all reasonable out-of-pocket costs and
expenses of Lender, including, without limitation, Lender's reasonable
counsel fees in connection with Lender's joinder and consent to the
Master Association Documents and the Declaration of Condominium.
(i) The Lender agrees that, upon its prior written approval of
the Condominium Documents and simultaneously with the recording of
those Condominium Documents required to be recorded and provided there
is no Event of Default under the Loan Documents, the Lender will
confirm its consent to the Condominium Documents and the Mortgage will
be subordinated to the Condominium Documents for the Project with the
same force and effect as if the Condominium Documents had been
executed, delivered and recorded prior to the execution, delivery and
recording of the Mortgage; provided, however, Lender approves the form
and substance of any such subordination agreement and such agreement
is accompanied by an endorsement from the Title Company insuring the
continued first priority lien of the Mortgage on all Condominium Units
within the Condominium and all rights and privileges reserved to
declarant under the Condominium Documents, including, if applicable
and without limitation, rights to add future phases and make additions
to or deletions form the property and interests subjected to the
Condominium Statute.
6.2 ACTIONS AFTER CREATION OF CONDOMINIUM. Upon and after the
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effective submission of the Condominium Units in the Project to the
Condominium Statute the following shall be applicable:
(a) The Borrower shall pay all common expense assessments and all
other assessments as required by the Condominium Documents, or any
resolutions adopted pursuant thereto, with respect to unsold
Condominium Units and shall promptly upon demand exhibit to Lender
receipts for all such payments. The failure of the Borrower to make
any such payment or to exhibit such receipts shall constitute an Event
of Default under the Loan.
(b) The Lender shall have all the rights and privileges which the
owner of a Condominium Unit has by virtue of the Condominium Statute
and the Condominium Documents as though the Lender were in fact a
Condominium Unit owner, including without limiting the generality of
the foregoing, all voting rights accruing to the Borrower under the
terms of the Condominium Documents, it being understood that in the
event of an Event of Default by the Borrower under the terms of any of
the Loan Documents (including this Addendum) and so long as the same
shall continue the Lender may vote in the place and stead of the
Borrower. The Lender may exercise any and all of said rights
hereinabove referred to, and, where permitted by Law, the Borrower
hereby nominates and appoints the Lender so long as the Mortgage
remains in effect as the Borrower's irrevocable proxy to vote and, as
the Borrower's agent, to act with respect to all of said rights which
any such default shall continue. Written notice of default from the
Lender to the Condominium association shall be deemed conclusive as to
the existence of such default and as to the Lender's rights and
privileges under this paragraph, including all voting rights accruing
to the Borrower under the terms of the Condominium Documents and the
Condominium Statute. The provisions of this paragraph shall in no
event render the Lender liable for any common charges or assessments
required by the Condominium Documents, or any resolution adopted
pursuant to the Condominium Statute, nor shall they cause, in and of
themselves, the Lender to be deemed a declarant.
(c) The Borrower shall not, except after notice to the Lender and
with the prior written consent of the Lender: (i) vote for or consent
to any modification of, amendment to or relaxation in the enforcement
of any provision of the Condominium Documents; (ii) in the event of
damage to or destruction of the Project, vote in opposition to a
motion to repair, restore, or rebuild; (iii) in each and every case in
which under the provisions of the Condominium Statute or the
Condominium Documents the unanimous consent or the unanimous vote of
owners of Units is required to vote or give such consent; (iv)
partition or subdivide any Unit; (v) consent to the termination of the
Condominium, except for abandonment or termination provided by law in
the case of substantial destruction by fire or other casualty or in
the case of taking by condemnation or eminent domain; (vi) consent to
any amendment to the Condominium Documents; or other documents of the
Condominium; (vii) consent to the effectuation of any decision by the
Condominium association to terminate professional management and
assume self-management of the Condominium; (viii) exercise any
development right reserved in the Condominium Documents; or (ix) merge
or consolidate the Condominium with any other condominium.
(d) The Borrower shall fully and faithfully observe, keep and
perform each and every requirement, condition, covenant, agreement and
provisions under the Condominium Statute, the Condominium Documents,
by-laws of the Condominium association and rules of the Condominium
and on the part of the Borrower to be observed, kept and performed.
The Borrower shall promptly deliver to the Lender a copy of each and
every notice of default received by the Borrower with respect to any
obligation of the Borrower under the provisions of the Condominium
Statute, the Condominium Documents, the by-laws or the rules of the
Condominium association. In the event the Borrower shall not cure or
remedy any default within a period of thirty (30) days after notice
thereof from the Condominium association or the Lender then and in any
such case the Lender may from time to time at its option but without
any obligation to do so, cure or remedy any such default of the
Borrower, and in addition, at the option of the Lender, the entire
indebtedness outstanding under the Loan shall become due and payable
at once without further notice (together with any sums advanced by the
Lender to cure or remedy any such default).
6.3 PARTIAL RELEASES OF UNITS. Provided that no Event of Default
----------------------------
exists, and provided the Governing Documents (as applicable) have been
filed in the Public Records of the county in which the Land is located,
Lender agrees to release individual Units from the lien of the Mortgage in
accordance with and subject to all of the following terms, provisions and
conditions:
(a) The Improvements shall have achieved Completion in accordance
with the Plans and Specifications and a Certificate of Occupancy (or a
temporary certificate of occupancy) for all of the Units on the floor
of the Improvements in which the applicable Unit is located shall have
been issued and any required approval by the fire marshal or its
equivalent having jurisdiction over the Project and any other approval
required by any Governmental Authority, to the extent that any such
approval is a condition to the lawful use and occupancy of the Units
and the opening of same to the public, shall have been obtained.
(b) Borrower shall pay to Lender, prior to the time of delivery
of the partial release, in cash or immediately available funds (which
payment shall be applied in reduction of the unpaid principal balance
of the Loan), for each Unit sought to be released, the Release Price.
(c) Requests for partial releases must be in writing (a "Request
-------
for Partial Release"), and must be accompanied by all data reasonably
--------------------
necessary to support the Borrower's being entitled to the partial
release, including, without limitation, a legal description for each
Unit to be released, a partial release document prepared by Borrower
at Borrower's expense in form and content satisfactory to Lender and a
schedule containing a list of those Units previously released by
Lender and those Units remaining to be released.
(d) Releases shall not affect or impair the lien of the Mortgage
and Lender's lien and security interests created by the other Loan
Documents as to Units and other property encumbered by the Mortgage
and the other Loan Documents not theretofore released, and said liens
and security interests shall continue in full force and effect as to
the unreleased Units and such other property.
(e) As a condition precedent to Lender's delivery of each partial
release, Borrower shall submit to Lender a photocopy of the final
signed closing statement with respect to the sale of each applicable
Unit.
(f) Borrower shall pay all out-of-pocket costs and expenses of
Lender, including, without limitation, fees and expenses of Lender's
Counsel in connection with any partial release.
(g) Borrower shall request each partial release not less than ten
(10) days prior to the date the partial release is needed.
6.4 INDEMNIFICATION. The Borrower hereby agrees to indemnify, defend,
---------------
and hold Lender harmless against and from (a) any and all liability, loss,
damage and expense (including without limitation all attorneys' fees and
expenses) which it may incur or which may be asserted under or in
connection with this Agreement, the Governing Documents, or any related
documents or by reason of any action taken by the Lender under the
Mortgage, and (b) any and all claims and demands whatsoever which may be
incurred by or asserted against Lender by reason of any alleged obligations
or undertakings on its part to perform or discharge any of the terms,
covenants and conditions contained herein in the Governing Documents, or in
any related documents. Should Lender incur any such liability the amount
thereof, together with interest thereon a the Default Rate shall be payable
by the Borrower to Lender immediately upon demand, or at its option, Lender
may reimburse itself therefore out of any rents, sales proceeds or other
income of the Borrower related to the Project collected by the Lender and
shall be secured by the Mortgage until paid. The foregoing indemnification
agreement shall survive the payment of the Loan.
7. SALES UPDATES. Borrower shall provide Lender with monthly Project sales
-------------
updates for the Units.
8. USE OF CONTRACT DEPOSITS TO FUND CONSTRUCTION AND OTHER COSTS. Subject
--------------------------------------------------------------
to the requirements governing Usable Deposits as set forth in the Loan
Agreement, the Borrower may use a portion of the Contract Deposits for the
Condominium Units given to Borrower pursuant to Contracts of Sale and legally
available under Chapter 718, Florida Statutes for use to pay for Hard Costs of
Construction of the Improvements in lieu of the funding of the Loan proceeds to
pay Hard Costs. Notwithstanding anything to the contrary contained herein or in
the Loan Agreement, to the extent that Contract Deposits (including Usable
Deposits, to the extent applicable) are used to fund Construction of the
Improvements, the amount of the Loan originally allocated for such Construction
of the Improvements shall remain in the applicable Line Item and will not be
subject to reallocation pursuant to the Loan Agreement. Additionally, such set
aside amount shall not be considered a portion of the "undisbursed balance of
the Loan" as such term is used in herein. If Borrower is required to refund any
Condominium Deposit(s) that were used to pay for Hard Costs, the amount will be
drawn by funding on the specified Line Item for which such Contract Deposits
were originally used, provided that no Default shall then exist and the Loan
will remain "in balance" after such funding, as determined by Lender. Subject to
the requirements governing Usable Deposits as set forth in the Loan Agreement,
and subject to the terms of the applicable Contract of Sale, Borrower may use
the Townhouse Deposits given to Borrower pursuant to Contracts of Sale for any
lawful purpose.
IN WITNESS WHEREOF, the undersigned have executed this Addendum the day and
year first above written, the execution hereof by Borrower constituting a
certification by the manager executing on its behalf that the representations
and warranties made in Section 3 hereof are true and correct as of the date
hereof and that the entities and individuals executing this Addendum on behalf
of the manager are duly appointed officers indicated under his or her name, and
the incumbent in the office indicated under his or her name.
[SIGNATURE PAGES FOLLOW]
EXECUTED as of the date first set forth above.
BORROWERS TIERRA DEL SOL RESORT (PHASE 1), LTD.. a
Florida limited partnership
By: TDS MANAGEMENT, LLC, a Florida
limited liability company, its
general partner
By:/s/Xxxxxxx X. Xxxxxx
---------------------------------
Xxxxxxx X. Xxxxxx, its Manager
TDS TOWN HOMES (PHASE 1), LLC, a
Florida limited liability company
By: TIERRA DEL SOL RESORT (PHASE 1),
LTD., a Florida limited partnership,
its manager
By: TDS MANAGEMENT, LLC, a Florida
limited liability company, its
general partner
By:/s/Xxxxxxx X. Xxxxxx
------------------------------
Xxxxxxx X. Xxxxxx, its Manager
XXXXX XXXXXX I REAL ESTATE, LLC, a
Florida limited liability company
By: TIERRA DEL SOL RESORT (PHASE 1),
LTD., a Florida limited partnership,
its manager
By: TDS MANAGEMENT, LLC, a Florida
limited liability company, its
general partner
By:/s/Xxxxxxx X. Xxxxxx
-------------------------------
Xxxxxxx X. Xxxxxx, its Manager
TDS AMENITIES, INC., a Florida
corporation
By:/s/Xxxxxxx X. Xxxxxx
---------------------------------
Xxxxxxx X. Xxxxxx, President
LENDER: KEYBANK NATIONAL ASSOCIATION,
a national banking association
By:/s/Xxxxxx X. Xxxxxxxxxx
---------------------------
XXXXXX X. XXXXXXXXXX,
Xx. Vice President
