LOAN AGREEMENT
BY AND BETWEEN
TRANSEASTERN PEMBROKE VILLAGES, INC.,
A FLORIDA CORPORATION
(THE "BORROWER")
AND
CHASE FEDERAL BANK, A FEDERAL SAVINGS BANK, A DIVISION OF
NATIONSBANK, N.A. (SOUTH), A NATIONAL BANKING ASSOCIATION
ORGANIZED AND EXISTING UNDER THE LAWS OF THE UNITED STATES
(THE "BANK")
DATED: SEPTEMBER ___, 1996
XXXXXXX X. XXXX, ESQ.
XXXXXXX XXXXXXX & XXXXX XXXXX
0000 XXXXXXX XXXX
XXXXX 000
XXXXX XXXXX, XXXXXXX 00000
(000) 000-0000
Loan No. 91000839
THIS LOAN AGREEMENT, dated as of the _____ day of September, 1996 (the
"Loan Agreement" or "Agreement"), is made by and between TRANSEASTERN PEMBROKE
VILLAGES, INC., A FLORIDA CORPORATION, with its principal place of business at
0000 Xxxxxxxxxx Xxxxx, Xxxxx Xxxxxxx, Xxxxxxx 00000 ("Borrower"), and CHASE
FEDERAL BANK, A FEDERAL SAVINGS BANK, A DIVISION OF NATIONSBANK, N.A. (SOUTH), a
national banking association organized and existing under the laws of the United
States, with its offices located at 000 Xxxx Xxxxxxx Xxxxx Xxxx, Xxxxx 000, Xxxx
Xxxxxxxxxx, Xxxxxxx 00000 ("Bank").
RECITALS
A. Borrower has applied to Bank for a loan in the principal amount of
EIGHT MILLION SEVEN HUNDRED THIRTY SEVEN THOUSAND FIVE HUNDRED AND NO/100
DOLLARS ($8,737,500.00) (the "Loan") to be used for the purpose of acquiring the
Land, as hereinafter defined, and developing same into single family lots and
townhome lots now owned or to be acquired by Borrower in fee simple and
mortgaged to Bank as security for the Loan, which lots are to be located in a
certain residential developments known as "Pelican Pointe" and "Egrets Way"
located upon certain property in Broward County, Florida.
B. Bank has agreed to accept a note and mortgage under which advances
may be made for the land acquisition and infrastructure development in
accordance with plats, specifications, terms, and conditions approved by Bank.
C. Bank is willing to make the Loan described above based on the terms
and conditions set forth in this Loan Agreement and in the Loan Documents
referred to herein.
NOW, THEREFORE, in consideration of the premises, of the Loan advances
which are to be agreed to be made by Bank to Borrower hereinafter and the note
and mortgage given by Borrower in evidence thereof, and for other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, Borrower and Bank hereby agree as follows:
ARTICLE I
DEFINITIONS
1.1 For the purposes hereof:
(a) "Approved Project" or "Project" means the collective reference
to the development identified in Section 2.4 of this Agreement,
together with the Land, the Improvements, rights, property, and
appurtenances as defined, described or identified in the Mortgage.
(b) "Borrower's Representative" means the person or persons
designated in writing to Bank by Borrower as being authorized to submit
Draw Requests on Borrower's behalf and to consent to changes in the
Cost Breakdown and Use of Proceeds. Unless and until changed by written
notice to Bank, Borrower designates any one of the following: Xxxxxx
Xxxxxxx or Xxx Xxxxxxxx as its Borrower's Representative(s).
(c) "Closing Date" means the date as of which this Loan Agreement
is executed by Borrower and Bank.
(d) "Collateral" means the Mortgaged Property, Rents, Intangible
Property and other property rights as defined in and encumbered by the
Mortgage.
(e) "Commitment" means Bank's commitment letters to Borrower dated
July 5, 1996 and all amendments thereto. The parties intend that this
Agreement and the Loan Documents shall supersede and replace the
Commitment.
(f) "Completion means completion of the Improvements in accordance
with the Plans, such Completion to be evidenced by satisfaction of the
conditions of Section 6.2 in substantial compliance with the Plans,
free and clear of liens or claims of liens or other encumbrances,
except Permitted Encumbrances;
(g) "Construction Documents" means the stipulated sum construction
contract between Borrower and the General Contractor, if a General
Contractor is engaged, and all other contracts, plans or documents
concerning the construction of the Improvements and any addenda,
amendments or modifications thereto. The Construction Documents shall
include a hard cost breakdown and a maximum fixed cost for the
performance of all services, labor, and materials furnished thereunder.
(h) "Construction Inspector" means the architectural or engineering
firm or such party which Bank shall designate to perform various
services on behalf of Bank. The services to be performed by Bank's
Construction Inspector shall include the issuance of reports and
certifications solely for the benefit of Bank and shall not impose upon
Bank any obligation to make inspections, or to correct or require any
other person to correct any defects, or to notify any person with
respect to such defects, review of the Plans and all proposed changes
to them, preparation of a "cost breakdown" construction analysis (the
"Construction Analysis"), periodic inspections of construction work for
conformity with the Plans, and approval of Draw Requests.
(i) "Cost Breakdown" means the detailed trade breakdown of the cost
of constructing the Improvements and an itemization of non-construction
and Land costs, all as approved by Bank from time to time.
(j) "Default" means a violation of any term, covenant, or condition
hereunder or a Default as defined under any of the other Loan Documents
which remains uncured after any applicable grace period.
(k) "Default Condition" means the occurrence or existence of an
event or condition which, upon the giving of notice or the passage of
time, or both, would constitute a Default.
(l) "Draw Request" means a written request for any disbursement of
Loan proceeds, which shall be submitted for each requested disbursement
as set forth in Article III hereof, in accordance with the draw request
sheet attached hereto as EXHIBIT "A-1", EXHIBIT "A-2" AND EXHIBIT
"A-3".
(m) "Engineer" shall mean such party who will serve as Borrower's
supervising engineer in accordance with the Plans and specifications;
(n) "Engineering Contract" means the "full service', contract
between Borrower and Engineer which shall require engineering services
throughout the Land development and construction contemplated under the
Loan.
(o) "Financing Statements" means the UCC financing statements filed
in order to perfect Bank's lien on certain personal property and
fixtures as more particularly described therein.
(p) "Firm Contract" means an arm's length, bona-fide binding
contract for purchase and sale, in form and content satisfactory to
Bank, for the sale of a Unit to a purchaser unaffiliated and unrelated
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to Borrower or Guarantor, under which (i) Borrower has received a cash
deposit equal to ten percent (10%) of the purchase price except as
herein after provided; (ii) Borrower is not obligated to provide any
purchase-money financing, (iii) all applicable statutory cancellation
or rescission periods have expired, (iv) there are no contingencies
other than a first mortgage financing contingency for which Borrower
has confirmed to Bank that purchaser has made a mortgage application,
(v) the closing date for the contract is within forty-five (45) days of
the date of issuance of the Certificate of Occupancy for the Unit, and
(vi) the gross sales price, after payment of all of Borrower's closing
expenses thereunder, will result in sufficient proceeds to pay to Bank
the Unit Release Price and Lot Release Price. If a purchaser has
received preliminary loan approval from an institutional Bank,
including income qualification and credit verification, the required
deposit shall be five percent (5%) for said contract to constitute a
Firm Contract. The purchaser's interest in the Mortgaged Property and
under the Firm Contract must be expressly subordinated to the lien and
operation of Bank's Mortgage, either by separate subordination
agreement in favor of Bank or pursuant to the terms of the Firm
Contract.
(q) "General Contractor" means Borrower who will serve as the
general contractor in accordance with the Construction Documents; if a
General Contractor is not engaged or is not named here, any obligation
of the General Contractor referred to in the Loan Documents shall be
the obligation of the Borrower to perform or to cause to be performed.
(r) "Governmental Authorities" means any local, state, or federal
governmental agency, regulatory body or office, or any
quasi-governmental office (including health and environmental), or any
officer or official of any such agency, office, or body whose consent
or approval is required as a prerequisite to the commencement of the
construction of the Improvements or to the operation and occupancy of
the Improvements or the Approved Project or to the performance of any
act or obligation or the observance of any agreement, provision or
condition of whatsoever nature herein contained.
(s) "Guarantor" means: Xxxxxx Xxxxxxx, Xxxxxx Xxxxxxx, Xxxxxx Xxxxx
And Transeastern Properties, Inc., a Florida corporation, f/k/a
Transeastern Properties of South Florida, Inc., a Florida corporation.
(t) "Guaranty" means the Guaranty Agreement executed by Guarantor
in favor of Bank, providing for Guarantor's payment of all sums due
under the Loan Documents and of performance of all obligations of
Borrower thereunder except as otherwise specifically therein provided,
including, without limitation, timely completion of the Improvements in
accordance with the Construction Documents and Loan Documents.
(u) "Improvements" means all infrastructure improvements to the
Land constructed or to be constructed on the Land as defined in the
Mortgage, together with all fixtures and appurtenances now or later to
be located on the Land and/or in such Improvements.
(v) "Land" means the real property described in the Mortgage at the
inception of the Loan as per EXHIBIT "F" attached hereto.
(w) "Loan Documents" means this Loan Agreement, the Note and any
funding agreement, the Mortgage, the Guaranty, the Financing
Statements, and any other document or writing executed in connection
therewith or in furtherance thereof.
(x) "Lot Release Price" shall mean the partial release price for
each lot improved with Note proceeds as set forth in EXHIBITS "B-1" AND
"B-2" attached hereto and incorporated herein.
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(y) "Mortgage" means the Amended and Restated Real Estate Mortgage,
Assignment and Security Agreement of even date herewith executed by
Borrower for the benefit of Bank encumbering the Collateral (as defined
in the Mortgage), and any extensions, modifications, renewals or
replacements thereof.
(z) "Note" means the Consolidated Renewal Promissory Note in the
amount of EIGHT MILLION SEVEN HUNDRED THIRTY SEVEN THOUSAND FIVE
HUNDRED AND NO/DOLLARS ($8,737,500.00) ("Note") dated as of the Closing
Date executed by Borrower in favor of Bank as well as any promissory
note, sub-note, or other notes issued by Borrower in substitution,
replacement, extension, future advance, amendment or renewal of the
Note or any such promissory note or notes.
(aa) "Permitted Encumbrances" means those liens, encumbrances,
easements and other matters defined in the Mortgage as "Permitted
Encumbrances".
(bb) "Plans" means plans and specifications for the development of
the Land and construction of the Improvements submitted to and approved
by Bank from time to time, and including such amendments thereto as may
from time to time be made by Borrower and approved by Bank.
(cc) "Security Documents" means the Mortgage, the Financing
Statements, and any other instrument executed to establish and perfect
Bank's lien on the Collateral, and any extensions, modifications,
renewals, or replacements thereof.
(dd) "Site Development Contractor" means such party who will serve
as the subcontractor for the site development of the Land as
contemplated under the Loan.
(ee) "Site Development Contract" means the contract between
Borrower and Site Development Contractor for the site development of
the Land per the site development Plans and specifications.
(ff) "Site Plan" means collectively the site plans for the Project
as set forth on EXHIBIT "E" attached hereto.
(gg) "Title Policy" means the mortgagee title policy meeting the
requirements of this Loan Agreement.
(hh) "Unit" means a portion of the Land suitable for the
construction of single residential dwelling units, and designated or
depicted as such on the site plans submitted to Bank by Borrower.
(ii) "Unit Release Price" shall mean the partial release price for
each Unit as set forth on EXHIBIT "B" attached hereto and incorporated
herein.
(jj) "Use of Proceeds" means the description of the permitted use
of the Loan proceeds under the Note as set forth on EXHIBIT "A-1",
EXHIBIT "A-2" AND EXHIBIT "A-3" attached hereto and incorporated by
reference herein.
Capitalized terms not defined in this Loan Agreement shall have the
meanings ascribed to them in the Mortgage.
ARTICLE II
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THE LOAN
2.1 LOAN TERMS. Subject to the terms and conditions of this Loan
Agreement, Bank will lend and Borrower will borrow the principal sum of EIGHT
MILLION SEVEN HUNDRED THIRTY SEVEN THOUSAND FIVE HUNDRED AND NO/100 DOLLARS ($
8,737,500.00), which borrowing shall be evidenced by the Note. Also, all of the
terms, definitions, conditions, and covenants of the Note, the Guaranty, the
Mortgage, and any other documents executed in connection therewith or pursuant
thereto are expressly made a part of this Loan Agreement by reference in the
same manner and with the same effect as if set forth herein at length and shall
have the meaning set forth in such instruments unless otherwise defined herein.
2.2 NOTE. Intentionally omitted.
2.3 CONSTRUCTION LINE. Intentionally omitted.
2.4 LOAN PURPOSE. The purpose of the Loan is to finance the acquisition
of the Land as well as the completion of infrastructure development for the
NASHER P.U.D. (P.U.D. Development") and the development of the Land into two (2)
residential developments to be located on parcels (referred to as Parcel "D" and
Parcel "F") of the Land. Parcel "F" is to be developed into one hundred fourteen
(114) developed single family lots, Parcel "D" is to be developed into three
hundred fifty six (356) townhome lots in the approved projects known as "Egrets
Way" and "Pelican Pointe" respectively, located in Pembroke Pines, Florida,
which projects shall be hereinafter collectively referred to as the "Approved
Project".
2.5 LIMITATIONS ON USE OF NOTE PROCEEDS. Bank will disburse Note
proceeds for the acquisition and development of the Land subject to the terms
and conditions of this Loan Agreement and in accordance with the Use of Proceeds
attached hereto as EXHIBIT "A-1", EXHIBIT "A-2" AND EXHIBIT "A-3".
(a) Disbursements shall be made on the basis of the net amount due,
not to exceed one hundred percent (100%) of cost (i) as shown on the
application for payment from the General Contractor of work and
materials in place, (ii) as substantiated by an independent engineer
retained by Bank at Borrower's expense and (iii) as based on the
budgeted costs provided by Borrower to Bank which have been reviewed
and approved by such independent engineer, (iv) and in accordance with
EXHIBIT "A-1", EXHIBIT "A-2" AND EXHIBIT "A-3" attached hereto.
2.6 LIMITATIONS ON USE OF CONSTRUCTION LINE PROCEEDS. Intentionally
omitted.
2.7 LOAN MATURITY. The maturity date of the Note shall be September 1,
1999 with two (2) extension option of three (3) months each to be granted at the
Borrower's request, at the sole and absolute discretion of the Bank and as more
particularly set forth in such Note. On the Maturity Date of the Note, all sums
outstanding under such notes shall be immediately due and payable, and the
Bank's obligation to fund shall cease and terminate.
ARTICLE III
DISBURSEMENTS
3.1 NOTE DISBURSEMENT - GENERAL PROVISIONS. Bank agrees that it will,
from time to time, and so long as there shall exist no Default Condition or
Default (which has not been cured within any applicable grace period), disburse
Note proceeds for the purchase and development of the Land in the Approved
Project subject to the terms and conditions of this Agreement.
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3.2 GENERAL PROVISIONS. Bank agrees that it will, from time to time,
and so long as there shall exist no Default Condition or Default (which has not
been cured within any applicable grace period), but not more frequently than two
(2) times per month, disburse proceeds for the infrastructure construction in
the Approved Project, subject to the terms and conditions of this Agreement.
3.3 REQUEST FOR INITIAL FUNDING FOR DEVELOPMENT OF LAND UNDER THE NOTE
When Borrower wishes to commence funding Land development Borrower shall submit
a draw request, accompanied by all items required in Articles IV and V as
conditions precedent, to the extent applicable. All supporting documentation
shall be submitted no later than five (5) days prior to the requested date of
the initial disbursement under each note. No disbursement by Bank shall
constitute an approval or acceptance by Bank of any construction work or
constitute a waiver by Bank of any conditions precedent to any future
disbursements. Bank shall not be obligated to approve any disbursement for
purposes other than those contemplated in this Agreement. The conditions set
forth in Articles IV and V hereof must be satisfied before Bank will make the
first advance or disbursement for the development of Land and the conditions set
forth in Article VI hereof must be and remain satisfied before Bank will make
each subsequent disbursement or advance.
3.4 INTERIM DRAW REQUESTS. No later than five (5) days prior to each
disbursement by Bank, Borrower must submit to Bank a Draw Request, which shall
include or be accompanied by the requirements set out herein for draws.
3.5 DISBURSEMENT AMOUNTS. Following receipt of a Draw Request and
Bank's review and approval of supporting documentation, Bank shall determine the
amount of the disbursement it will make in accordance with Bank's standard draw
sheet, a copy of which is attached as EXHIBIT "A-1", EXHIBIT "A-2" AND EXHIBIT
"A-3" provided no Default Condition or Default exists.
3.6 EQUITY DISBURSEMENTS. If Bank at any time determines in its
reasonable discretion that the Loan proceeds plus the amount of all equity
investments made or scheduled to be made are not sufficient to fully complete
the Improvements in accordance with the Plans and to pay all other sums due
under the Loan Documents, then Bank shall have the option of requiring Borrower
to deposit with Bank additional funds from some other source (or submit evidence
to Bank of equity investments previously made) in amounts sufficient to cover
the resulting deficit before Bank will disburse any additional Loan proceeds.
Deposited funds shall be advanced as construction progresses in accordance with
this Loan Agreement before any additional Loan disbursements are made.
3.7 OPTION TO DISBURSE FUNDS TO ANY GUARANTOR AND/OR TO PAY
CONTRACTORS. If a Default shall exist, at its option, Bank may, after so
notifying Borrower, make Loan disbursements directly to any guarantor or obligor
of the debt when such party shall be performing the obligations of Borrower
hereunder or the General Contractor or any unpaid subcontractor, laborer or
material supplier providing labor, services or materials in connection with the
construction of the Improvements, and the execution of this Loan Agreement by
Borrower shall, and hereby does, constitute an irrevocable direction and
authorization to Bank to so disburse the funds. No further direction or
authorization from Borrower shall be necessary to warrant such direct
disbursements and all such disbursements shall be secured by the Security
Documents as fully as if made to Borrower, regardless of the disposition thereof
by the General Contractor, any subcontractor, laborer or material supplier so
paid.
ARTICLE IV
GENERAL PRE-CLOSING CONDITIONS
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Bank's obligations to close the Loan shall be expressly conditioned
upon satisfaction of the following conditions, or execution and/or delivery to
Bank of the following items, all in form and substance reasonably satisfactory
to Bank and Bank's counsel:
4.1 NOTE. The original Note, properly executed, shall have been
delivered to Bank.
4.2 GUARANTY. The original Guaranty(s), properly executed, shall have
been delivered to Bank.
4.3 MORTGAGE. The Mortgage, which shall be a first lien on the Land and
Improvements, shall have been properly executed in recordable form and delivered
to Bank, subject to those matters reflected in the Title Policy.
4.4 INDEMNITY. The Hazardous Substance Certificate and Indemnification
Agreement, properly executed by Borrower and each Guarantor, shall have been
delivered to Bank.
4.5 FINANCING STATEMENTS. The Financing Statements on forms approved
for filing in the appropriate state and local filing offices shall have been
properly executed.
4.6 TITLE POLICY. A standard ALTA mortgagee title policy insuring the
lien of the Mortgage as a first priority lien encumbering the Land and
Improvements from a company or from companies approved by Bank (including any
reinsurance agreements required by Bank, together with direct access provisions
in favor of Bank): (1) providing coverage for the full principal amount of the
Loan, (2) providing a variable rate endorsement, if appropriate, the Form 9
Endorsement, the Survey Endorsement, and any other endorsements requested by
Bank, (3) deleting all "standard" exceptions except taxes for the current year,
(4) insuring all appurtenant easements, (5) containing no bankruptcy or
creditors' rights exceptions or exclusions; and (6) containing no title
exceptions other than the Permitted Exceptions or the other exceptions approved
by Bank.
4.7 TITLE EXCEPTIONS. Copies of all documents creating exceptions to
the Title Policy.
4.8 SURVEY/RECORDED AND PRELIMINARY PLAT/APPROVED SITE PLAN. Three (3)
copies of a recent survey of the Land prepared by a registered land surveyor
acceptable to Bank and certified to Bank, the title insurance company, and
Borrower. Such survey shall contain a certification as to the applicable flood
zone (s) for the Land, and a certification that the survey was and in accordance
with the Minimum Technical Standards for Surveys as set fourth in Chapter
21HH-6, Florida Administrative Code. In addition, a copy of the boundary plat
for the Land and a copy of the site plan is required approved by all applicable
governmental authorities. Notwithstanding the foregoing, the Bank will not
unreasonably withhold its consent to the execution of the final plat and will
join when requested by Borrower.
4.9 FLOOD HAZARDS. Evidence as to whether or not the Land is located
within an area identified as having "special flood hazards" as such term is used
in the Federal Flood Disaster Protection Act of 1973.
4.10 FLOOD HAZARD INSURANCE. If all or any part of the Improvements is
or is to be located in an area having "special flood hazards", a flood insurance
application or policy naming the Bank as mortgagee must be submitted to Bank at
such time as it is commercially available. Satisfactory evidence of premium
payments must also be provided.
4.11 BUILDER'S RISK INSURANCE. A builder's risk insurance policy
meeting the requirements set forth in the Mortgage.
4.12 LIABILITY INSURANCE. Liability insurance meeting the requirements
set forth in the Mortgage.
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4.13 BORROWER'S ORGANIZATIONAL DOCUMENTS AND RESOLUTIONS. A certified
copy, from the appropriate governmental body or corporate officer, of
organizational documents of Borrower, and any partner of Borrower, as
appropriate, certifying that Borrower and/or such partner (i) is duly organized,
validly existing, and in good standing under the state of its existence, (ii)
has the authority under such documents and laws to enter into the Loan as
contemplated by the Loan Documents, and (iii) has made all appropriate filings,
including without limitation, qualification to do business in the State of
Florida, necessary to enter into the Loan and execute the Loan Documents.
Additionally, Borrower shall provide (i) if appropriate, certified resolutions
or other internal documents or writing of Borrower and such partner evidencing
that Borrower and such partner have taken all requisite organizational action,
and received all organizational approvals necessary to enter into the Loan and
execute the Loan Documents, and (ii) such other documents or writings as Bank
may request.
4.14 GUARANTOR'S ORGANIZATIONAL DOCUMENTS AND RESOLUTIONS.
Intentionally omitted.
4.15 FICTITIOUS NAME CERTIFICATE. If Borrower utilizes or intends to
utilize a fictitious name, a copy of the Fictitious Name Certificate of the
Borrower issued by the Florida Secretary of State.
4.16 ATTORNEY'S OPINION. The written opinions of counsel to Borrower
and Guarantor, addressed to Bank, acceptable to Bank and Bank's counsel, as to
those matters required by Bank. The attorney's opinion, with respect to the
enforceability of remedies provided in any instrument may be made subject to or
affected by, applicable bankruptcy, moratorium, reorganization, insolvency or
similar laws from time to time in effect affecting the rights of creditors
generally. As to matters of fact, such opinions may be qualified to the extent
of the knowledge of such counsel based upon inquiry and reasonable
investigation.
4.17 RESTRICTIVE COVENANTS. A copy of the executed and recorded
homeowners, documents, filed articles of incorporation for the homeowners,
associations, executed by-laws for the associations, and any other related
documents as Bank may request for the Approved Project.
4.18 FINANCIAL STATEMENTS. The updated Borrower prepared financial
statements certified to the Bank must be received by Bank within thirty (30)
days of the Closing Date. With respect to the Guarantors, signed personal
financial statements on Bank forms shall be required prior to the Closing Date.
All statements must include income and contingent liability information.
4.19 OMPLIANCE WITH LAWS AND MATTERS OF RECORD. Satisfactory
documentary evidence that the Land, and the intended uses of the Land are in
compliance with all applicable laws, regulations and ordinances and private
covenants, easements, and conditions of record. Such evidence is subject to
approval by Bank and Bank's counsel and may include letters, licenses, permits,
certificates and other correspondence from the appropriate Governmental
Authorities, opinions of Borrower's counsel or other counsel, and opinions or
certifications from the Architect, Engineer and the General Contractor. The
laws, regulations and ordinances with which compliance should be evidenced
include without limitation the following: health and environmental protection
laws, laws related to or regulating water management districts, hazardous
materials and substances and stormwater drainage, erosion control ordinances,
tree and landscaping ordinances, building codes, land use requirements,
threshold building consultant requirements, the Development of Regional Impact
Statutes, doing business and/or licensing laws and zoning laws (the evidence
submitted as to zoning should include the zoning designation made for the Land,
the permitted uses of the Land under such zoning designation and zoning
requirements as to parking, lot size, ingress, egress and building setbacks).
4.20 TAXES. Evidence that the Land is, or will be, separately assessed
for tax purposes and information as to tax parcel identification numbers, tax
rates, estimated tax values and the identities of the taxing authorities. Also,
Borrower shall submit proof that the taxes are paid current upon the Land.
8
4.21 UTILITIES. Evidence of the availability and suitability of the
water, sewer, telephone, electrical, and other utilities needed to properly
service the Project in its intended use.
4.22 PLANS AND SPECIFICATIONS. Two sets of the site development Plans
which must have been approved in writing by Borrower and the General Contractor
either by initialing same or by other written approval identifying all pages and
dates, including revision dates. The Plans must include all site development
(including storm drainage, utility lines, erosion control and landscaping) plans
and specifications and must incorporate the recommendations in the soil testing
report. Bank will engage its engineer to review such Plans to determine
sufficiency of such under its guidelines.
4.23 PERMITS. Borrower will provide a copy, certified by the Borrower
to be a true and correct copy of the South Florida Water Management District
Permit, if applicable.
4.24 SOIL TESTS. A report as to soil borings made on the Land by a soil
testing firm satisfactory to Bank. The number and location of such borings shall
be in accordance with the recommendations of the soil testing firm and must also
be satisfactory to Bank. The report shall include the recommendations of the
soil testing firm as to the preparation of the soil needed in order to
adequately support the Improvements, and shall be delivered to and approved by
Bank within sixty (60) days of the date of this Agreement.
4.25 ENVIRONMENTAL ASSESSMENT.
(a) An environmental assessment of the Land and Improvements
performed at Borrower's expense by a licensed engineer or other
environmental consultant satisfactory to Bank stating that:
i. the Land is not located within any area designated as a
hazardous substance site by any of the Governmental Authorities;
and
ii. no hazardous or toxic wastes or other materials or
substances regulated, controlled, or prohibited by any federal,
state, or local environmental laws, including but not limited to
asbestos, are located on the Land or Improvements; and
iii. the Land has not been cited or investigated in the past
for any violation of any such laws, regulations, or ordinances.
(b) If the environmental assessment shall reveal any condition
unacceptable to Bank, same shall constitute a Default hereunder and in
addition to all remedies available to Bank, Bank shall be relieved of
any obligation under the Commitment. If the environmental assessment
recommends, or if Bank so requests, in its sole and absolute
discretion, a Phase II audit, additional testing or remedial action,
Borrower, at its sole cost and expense shall promptly conduct such
additional audits and testing and/or complete such remedial action.
Bank may require the Borrower to provide evidence that all necessary
actions have been taken to remove any hazardous substance contamination
and/or to restore the site to a condition acceptable to Bank and state
and federal governmental agencies.
4.26 TAXPAYER IDENTIFICATION NUMBER. Borrower's federal taxpayer
identification number.
4.27 BORROWER'S AFFIDAVIT. An affidavit of Borrower regarding the
absence of any other parties in possession of the Land, stating that a notice of
commencement has not been filed with respect to the Property, the
non-commencement of construction of Improvements , and such other matters as may
be requested by Bank.
4.28 COMMITMENT FEE. The balance of the non-refundable commitment fee
in the total amount of THIRTY FIVE THOUSAND NINE HUNDRED SIXTY AND NO/100
DOLLARS ($35,960.00), which was
9
earned upon acceptance of the Commitment and the reserving of sufficient funds
by Bank from which to make Loan disbursements, and is due and payable whether or
not any disbursements are made hereunder.
4.29 APPRAISAL. Bank shall have received a narrative appraisal
certified to the Bank for the Land and site development improvements prepared by
an appraiser acceptable to Bank.
4.30 COMPREHENSIVE PLAN. Documentary evidence, satisfactory to Bank and
its counsel, that Borrower's development proposal for the Project and the
construction of the Improvements are consistent with concurrency requirements
and other applicable provisions of the local comprehensive plan and local land
development regulations, as defined and required by the Local Government
Comprehensive Planning and Land Development Regulation Act, Florida Statutes.
Section 163.3161, et seq.
4.31 FACILITIES FOR HANDICAPPED. Subsequent to the Closing Date but not
later than the commencement of the construction of the sales center or the
clubhouse, as applicable, Bank shall have received and approved evidence,
satisfactory to Bank, that the Plans and specifications do, and the
Improvements, when constructed, will comply to the extent applicable with all
legal requirements regarding access and facilities for handicapped or disabled
persons, including, without limitation, and to the extent applicable, Part V of
the Florida Building Construction Standards Act entitled "Accessibility by
Handicapped Persons", Chapter 553, Fla Stat.; the Federal Architectural Barriers
Act of 1988 (42 U.S.C. ss.4151, et. seq.), The Fair Housing Amendment Act of
1988 (42 U.S.C. ss.3601, et. seq), The Americans With Disabilities Act Of 1990
(42 U.S.C. ss.12101 et. seq.), and The Rehabilitation Act of 1973 (29 U.S.C.
ss.794).
4.32 CONTRACTS. A copy of the executed contract for the purchase of the
Land by the Borrower, if applicable.
4.33 SUBORDINATION AGREEMENTS. Borrower will provide a fully executed
original Loan Subordination Agreement, which document shall be recorded in the
Public Records of Broward County, evidencing the subordination of Amresco
Funding Corporation, a Delaware corporation's interest, as evidenced by that
certain Mortgage, Assignment of Rents, and Security Agreement, dated March 29,
1996, and recorded April 3, 1996 in Official Records Book 24694 at Page 0744, of
the Public Records of Broward County, Florida (the "Amresco Third Mortgage") and
that certain Contingent Mortgage, Assignment of Rents and Security Agreement,
dated March 29, 1996 and recorded April 3, 1996, in Official Records Book 24694
at Page 0787, of the Public Records of Broward County, Florida, (the "Amresco
Fourth Mortgage") to the Bank's Mortgage.
4.34 MISCELLANEOUS. All other Loan Documents or items that are
customarily provided in loan transactions of this type and all other loan
documents or items set forth in the Commitment.
ARTICLE V
CONDITIONS PRECEDENT TO FIRST SITE DEVELOPMENT
5.1 NOTE DISBURSEMENTS. Under the Note, Bank shall not be obligated to
make the first Loan disbursement for the. development of the Land until all of
the following conditions have been satisfied by proper evidence, execution
and/or delivery to Bank of the following items, all in form and substance
reasonably satisfactory to Bank and Bank's counsel:
(a) There shall be no Loan Default or Default Condition.
(b) he Land shall be free and clear of all liens and encumbrances
except for Bank's Mortgage and the Permitted Exceptions, the Amresco
Third Mortgage and the Amresco Fourth Mortgage.
10
(c) All conditions precedent as set forth in Article IV shall have
been satisfied.
(d) Bank shall have received and approved Borrower's Draw Request.
(e) There shall not be any construction with respect to the Land
and no materials shall have been provided to the Land, which have not
been paid for by Borrower to the party providing same, and which have
been disclosed to Bank.
(f) Bank shall have received a copy certified by Borrower of all
applicable permits with respect to that draw including, without
limitation, excavation permits, tree removal permits, land development
permits, dredge and fill permits, stormwater discharge permits (federal
and state), and any other permits required for completion of the site
development of that portion of the Land for which the Loan Disbursement
is being requested.
(g) Borrower shall have paid to Bank the fees incurred by Bank for
property inspections in connection with draw requests.
(h) CONSTRUCTION DOCUMENTS. A copy of the Construction Documents
with respect to site development work and copies of all other executed
contracts as may be required by Bank.
(i) CONTRACTOR'S CONTRACT. Copies of the contracts signed by the
Borrower and Contractor for construction services.
(j) SITE DEVELOPMENT CONTRACTOR'S CONTRACT. Copies of the
contracts signed by the Borrower and Site Development Contractor for
construction services.
(k) ENGINEER'S CONTRACT. Copies of the contracts signed by the
Borrower and Engineer for engineering services.
(l) CONSENTS OF GENERAL CONTRACTOR, ENGINEER AND SITE DEVELOPMENT
CONTRACTOR. Consents from the General Contractor, Engineer and Site
Development Contractor to Borrower's assignments to Bank of Borrower's
interests in the contract with each of them, respectively. In
furtherance of the assignment granted herein, Borrower shall cause all
contract parties to acknowledge this assignment to Bank and agree to
continue such contract on the same terms as presently exist if Bank
shall succeed to the interest of Borrower thereunder and if so
requested by Bank.
5.2 CONSTRUCTION LINE DISBURSEMENTS. Intentionally omitted.
ARTICLE VI
CONDITIONS PRECEDENT TO DISBURSEMENTS
FOLLOWING THE FIRST DISBURSEMENT
6.1 GENERAL PERIODIC DISBURSEMENTS UNDER THE NOTE. Bank shall not be
obligated to make any Loan disbursements after the first disbursement provided
for in Article V under the Note until all of the following conditions have been
and remain satisfied as of the date of each such disbursement:
11
(a) All of the conditions stated in Article III hereof, including,
without limitation submission of a Draw Request.
(b) A request for payment signed by Borrower setting forth a
detailed breakdown of the disbursement requested in a format acceptable
to Bank.
(c) Construction of the Improvements for which such Draw Request
has been made has been performed in accordance with the Plans, the
Construction Schedule, and all terms and conditions hereunder.
(d) The Title Policy insurer shall have issued to the Bank an ALTA
Construction Endorsement Form to the Title Policy updating the Policy
and listing any additional subordinate matters or certifying that no
lien or other interest shall have attached to the Project other than
the interest of Bank pursuant to the lien of the Security Documents,
whether superior or subordinate to such lien, except taxes for the
current year and other matters acceptable to Bank, and there are no
liens which may take priority over the disbursement to be made and
there are no survey exceptions not theretofore approved by Bank in
writing.
(e) At the time of each disbursement: (i) Bank is reasonably
satisfied with the progress of construction; (ii) in Bank's reasonable
opinion, the equity requirements set out in Section 2.5 and 3.6 are
satisfied; and (iii) no Default Condition or Default exists under the
Loan Documents.
(f) Bank shall have received Bank's Construction Inspector's
approval to the Borrower's requisition for any hard costs.
(g) Bank shall have received copies of all notarized partial
release lien waiver forms executed by each appropriate subcontractor,
supplier and/or materialman which have filed a Notice to Owner.
(h) An Owner's Affidavit from Borrower certifying that the funds
disbursed to date by Bank have been paid to the appropriate parties.
(i) No litigation, arbitration or other proceeding shall have been
commenced against Borrower or the General Contractor, which in Bank's
judgment, materially impairs, or is likely to materially impair the
Borrower's or the General Contractor's ability to complete the Project.
(j) As and when reasonably requested by Bank, a recertification of
the Survey reflecting all changes in the physical conditions of the
Land and Improvements subsequent to the date of the last certification
of the Survey. Each such recertification shall show all construction
work in place.
(k) Bank, based on the advice of its Construction Inspector, must
believe in its reasonable opinion that construction can be completed
within the time frame set forth in the Bank's Engineer's Report.
(1) There shall not have been any destruction or casualty to the
Improvements not covered by insurance.
(m) If the Draw Request requires an amendment to the Use of
Proceeds or reallocation of hard cost items which would require
contractor and lienor notice under ss.713.347(2), Fla. Stat., written
notice from owner to the Contractor and all required lienors, in
compliance with ss.713.347,(2) Fla. Stat., and countersigned by the
Contractor and any lienors who have provided notices to owner.
(n) Retainage: Bank has the right to retainage in the amount of
three percent (3.0%) of the portion of the site development loan
relating to completion of infrastructure development for the NASHER
P.U.D. and six percent (6.0%) of the portion of the site development
loan relating to infrastructure
12
development of Parcel "D" and Parcel "F". Amounts so retained will be
disbursed with the final draw for the Site Development Contractor upon
Borrower's compliance, in addition to the requirement applicable to all
other disbursements, with the applicable requirements for a final draw
herein.
6.2 CONSTRUCTION LINE PERIODIC DISBURSEMENTS. Intentionally omitted.
6.3 REQUIREMENTS FOR DISBURSEMENT AT COMPLETION. Bank shall not be
obligated to make the final disbursement for the site development until all the
following additional conditions have been satisfied:
(a) The site development improvements in their entirety have been
commenced have been substantially completed and are substantially in
accordance with the Plans, and certificates as to such Completion have
been issued in satisfactory form to Bank by the Engineer and the
General Contractor, including, without limitation, Architect's
Certificate of Completion together with AIA G704 Certificate of
Substantial Completion, Contractor's Certificate of Completion together
with the AIA G704 Certificate of Substantial Completion and, if
applicable, the Engineer's Certificate of Completion, and certificates
as to occupancy and use have been issued by the appropriate
Governmental Authorities (and copies provided to Bank).
(b) Bank has received two sets of detailed as-built plans and
specifications approved and identified as such in writing by Borrower,
the Architect/Engineer and the General Contractor. The two sets must
include plans and specifications for all site development (including
without limitation, storm drainage utility lines and landscaping) work,
as applicable.
(c) Bank has received final lien waivers and releases from the
General Contractor and all general contractors, subcontractors,
subcontractors, suppliers, laborers, and materialmen certifying that
they and all parties in privity with them have been paid in full and
waiving their lien rights against the Project.
(d) Bank has received an inspection report performed by this
Construction Inspector in substance satisfactory to Bank and
Construction Inspector's written approval of the final Draw Request.
ARTICLE VII
THE BORROWER'S CONVENTS AND AGREEMENTS
7.1 PAYMENT AND PERFORMANCE. Borrower will pay when due or within any
applicable grace period all sums owing to Bank under the Note, this Loan
Agreement, the Mortgage and the other Loan Documents, and perform all
obligations as outlined or referenced therein.
7.2 FURTHER ASSURANCES. On demand by Bank, Borrower will do any act and
execute any additional documents reasonably required by Bank to secure the Loan,
to confirm or perfect the lien of the Security Documents, including, but not
limited to, additional financing statements or continuation statements, new or
replacement notes and/or Security Documents and agreements supplementing,
extending or otherwise modifying the Loan Documents, certificates as to the
amounts of the indebtedness evidenced by the Note from time to time, and
certificates that Borrower knows of no defaults by or defenses or set-offs
against Bank as long as such certificate represents the true statement of
Borrower.
7.3 CONSTRUCTION. The Borrower will: (a) continue
conscientiously the construction of the Improvements; (b) not discontinue or
permit the discontinuance of work on the Improvements for longer than fifteen
13
(15) consecutive days, (c) in any event, complete the Improvements, including
installation of any required items of personalty in substantial compliance with
the Plans, free and clear of liens or claims of liens for material supplied or
for labor or services performed in connection with the construction of the
Improvements; and (d) not file, prior to the recording of the Mortgage, a Notice
of Commencement for the Approved Project. Notwithstanding the foregoing, any
delays in the event of unavailability of materials at reasonable cost, strikes,
other labor problems, governmental order, acts of God or other events which
would support a defense based upon impossibility of performance for reasons
beyond the control of Borrower shall not be a breach of Borrower's
responsibilities under this Section VII.
7.4 PAYMENT OF CONTRACTORS. Borrower covenants to advise Bank
immediately, and in writing if Borrower receives any claim of lien in connection
with any services, labor or materials furnished in connection with the
construction of Units, and to remove such liens within thirty (30) days of the
date of filing. Borrower shall comply with the Construction Contract Prompt
Payment Law contained in the Florida Construction Lien Law, Chapter 713, Fla.
Stat. Notwithstanding the foregoing, Borrower shall not be in Default under this
paragraph if the number and amount of such liens are under the amounts set forth
in Section 9.1(g).
7.5 FEES AND EXPENSES. Whether or not the Loan is made or all Loan
proceeds disbursed hereunder, Borrower agrees to pay all expenses incurred by
Bank, or by Borrower in order to meet Bank's requirements, in connection with
the Loan, including without limitation, commitment and renewal fees or deposits
to Bank, fees for appraisal, environmental assessment, reappraisal, survey,
recording, title insurance, builder's risk and other insurance premiums,
brokerage commissions and claims of brokerage, property taxes, intangible taxes,
documentary stamp taxes, architect's fees, engineer's fees, inspection fees, the
General Contractor's fees, and such legal fees and costs incurred by Bank in
connection with the making and administration of the Loan, the enforcement, of
Bank's rights under the Loan Documents, arbitration, the renewal, modification,
or extension of the Loan, or in connection with litigation or threatened
litigation by a third party which arises because Bank made the Loan. Any such
amounts paid by Bank shall constitute part of the indebtedness which is secured
by the Security Documents, and shall be due and payable upon demand.
7.6 INSURANCE. Borrower covenants to maintain insurance, as required
herein and in the Mortgage.
7.7 TAXES AND INSURANCE. Upon the request of Bank, Borrower shall
submit to Bank such receipts and other statements which shall evidence, to the
satisfaction of Bank, that all taxes (by April 30th of each year), assessments
and insurance premiums have been paid in full.
7.8 TITLE POLICY. When requested by Bank during the Loan term, Borrower
shall provide an endorsement to the Title Policy certifying that (a) real estate
taxes due through such date have been paid; (b) no additional restrictions or
encumbrances are of record which have not been approved by Bank; and (c) no
liens or lis pendens have been filed against the Land or the Improvements. In
the event that periodic title endorsements are not required to be issued in
connection with the title insurance, Borrower agrees to cause title endorsements
to be issued as reasonably required by Bank. When requested, after the final
disbursement of Loan proceeds, Borrower will provide Bank with an endorsement to
the Title Policy insuring the principal balance of the Loan and containing no
exceptions not approved by Bank.
7.9 ADDITIONAL CONSTRUCTION. Intentionally omitted.
7.10 SALES REPORTS. Within ten (10) days after the end of each month
Borrower shall deliver to Bank a Sales Report covering that month such Sales
Report shall include, among other things as may be required by Bank, a
cumulative summary of the number of Units sold, closed and under construction as
well as the number of Spec and Model Units in each Transeastern Properties,
Inc., a Florida corporation project.
14
7.11 INSPECTION. Borrower will permit Bank and its authorized agents to
enter upon the Project during normal working hours and as often as Bank desires,
for the purpose of inspecting the construction of the Improvements. When
requested, Borrower will furnish to Bank detailed plans, shop drawings and
specifications which relate to the Improvements. Failure of Bank or its
authorized agents to discover deficiencies in or to reject materials or
workmanship incorporated or provided to the Improvements shall not make Bank or
its agent liable to Borrower or to any other person on account of such failure,
nor shall any prior failure constitute a waiver of Bank's right to subsequently
reject any such workmanship or materials. Borrower specifically acknowledges
that all inspections undertaken by Bank or its agent shall be for the sole
benefit of Bank and not for Borrower, any Guarantor, or any third party.
7.12 FOUNDATION AND OTHER SURVEYS. With respect to construction under
the Note, Borrower will promptly submit to Bank for its approval surveys as
requested by Bank prepared by a registered land surveyor and consistent with the
requirements of Section 4.8 above. In connection therewith, the surveyor shall
submit a certification as to the compliance of the Improvements, as then
constructed, with all applicable laws, ordinances, and regulations, including
without limitation, zoning laws, environmental regulations, and other relevant
restrictions. In addition to the surveys specifically required by this
Agreement, Borrower shall provide Bank during construction with such additional
surveys as requested by Bank.
7.13 SOIL AND OTHER TESTS. A report as to the compaction or other soil
tests made on the Land by a soil testing firm shall also be submitted to Bank
when so requested in accordance with the requirements of paragraph 4.24 above.
The number and locations of such soil tests shall be in accordance with the
recommendations of the soil testing firm. Borrower shall promptly submit to Bank
copies of reports of all other physical tests made on the Land, the Improvements
or the materials to be incorporated into the Improvements and shall, at
Borrower's expense, cause to be made such additional tests from time to time as
Bank may reasonably require.
7.14 USE OF LOAN FUNDS. Borrower shall use all Loan proceeds
disbursed to Borrower solely in payment of costs incurred in connection with
acquiring, developing and constructing the Project, in accordance Use of
Proceeds attached hereto as EXHIBITS "A-1" AND "A-2".
7.15 AVAILABILITY OF UTILITIES. All utility services necessary for the
construction of the Improvements and the operation thereof for their intended
purposes are presently available or will be available when needed through
presently existing public or unencumbered private easements or rights-of-ways in
accordance with validly executed and enforceable utility service agreements
between Borrower and the provider of each of such services (the "Utility Service
Agreements") (which would inure to the benefit of Bank in the event of the
foreclosure of the Mortgage) at the boundaries of the Land, including but not
limited to, water, storm and sanitary sewer, gas, electric and telephone
facilities, and all such utilities are non-interruptible. Borrower shall also
provide Bank with copies of all Utility Service Agreements.
7.16 HAZARDOUS SUBSTANCES. Borrower affirms and incorporates by
reference the representations, warranties, terms, conditions, and indemnities
contained in that certain Hazardous Substance Certificate and Indemnification
Agreement of even date herewith.
At any time deemed necessary by Bank, in its sole and absolute
discretion, Bank may, at its election, obtain one or more environmental
assessments of the Land prepared by a geohydrologist, an independent engineer,
or other qualified consultant or expert approved by Bank evaluating or
confirming (i) whether any Hazardous Substances as defined in other Loan
Documents are present in the soil or water at the Land and (ii) whether the use
and operation of the Land complies with all applicable Environmental Laws
relating to air quality, environmental control, release of oil, hazardous
materials, hazardous wastes and hazardous substances, and any and all other
applicable environmental laws. Environmental assessments may include detailed
visual inspections of the Land including, without limitation, any and all
storage areas, storage tanks, drains, dry xxxxx, and leaching areas, and the
taking of soil samples, surface water samples, and ground water samples, as well
as such other
15
investigations or analyses as are necessary. or appropriate for a
complete determination of the compliance of the Land and the use and operation
thereof with all applicable Environmental Laws. Such environmental assessments
shall be at the sole cost and expense of Borrower. In the event that it is
determined that additional tests and/or remediation are necessary as a result of
the aforesaid assessments, or in the event such additional testing or
remediation is recommended by the aforesaid assessments, the Borrower agrees to
immediately perform the tests or undertake the remediation as recommended. In
the event contamination or other environmental problem is found on the Property,
the Borrower shall be in Default hereunder after a thirty (30) day cure period.
7.17 CAPITAL ADEQUACY. If at any time after the date hereof, and from
time to time, Bank determines that the adoption or modification of any
applicable law, rule or regulation regarding taxation, Bank's required levels of
reserves, deposits, insurance, or capital (including any allocation of capital
requirements or conditions), or similar requirements, or any interpretation or
administration thereof by any governmental authority, central bank, or
comparable agency charged with the interpretation, administration, or compliance
of Bank with any of such requirements, has or would have the effect of (i)
increasing Bank's costs relating to the obligation hereunder, or (ii) reducing
the yield or rate of return of Bank on the obligation hereunder, to a level
below that which Bank could have achieved but for the adoption or modification
of any such requirements, Borrower shall, within fifteen (15) days of any
request by Bank, pay to Bank such additional amounts as (in Bank's sole
judgment, after good faith and reasonable computation) will compensate Bank for
such increase in costs or reduction in yield or rate or return of Bank. No
failure by Bank to demand immediate payment of any additional amounts payable
hereunder shall constitute a waiver of Bank's right to demand payment of such
amounts at any subsequent time. Nothing herein contained shall be construed or
so operate as to require Borrower to pay any interest, fees, costs, or charges
greater than is permitted by applicable law.
7.18 INDEMNIFICATIONS. The Borrower and the Guarantor shall indemnify
and hold Bank and its directors, officers, agents, employees, and attorneys
harmless from all liability, loss, expense or damage of any kind or nature,
including, without limitation, any suits, proceedings, claims, demands, or
damages (including attorneys' fees and costs paid or incurred in connection
therewith at both trial and appellate levels), incurred or arising by reason of:
(a) The Commitment or the making of the Loan (except for
liability, loss, expense or damage arising from the willful misconduct
or gross negligence of Bank);
(b) Any claim or action for the payment of any brokerage
commissions or fees which may be claimed to be payable in connection
with the Commitment; and
(c) The past, present or future handling, storage, transportation,
or disposal of hazardous substances upon the Land. Notwithstanding the
foregoing, Borrower's and Guarantor's indemnity shall be limited to the
extent provided in the Hazardous Substance Certificate and
Indemnification Agreement executed by such parties as of the Closing
Date.
These indemnifications shall survive the full payment and performance
of the obligations of the Borrower under the Loan documents except as set forth
above and in the Hazardous Substance Certificate and Indemnification Agreement.
7.19 FINANCIAL STATEMENTS. Borrower and each Guarantor shall submit
annual and interim financial statements as set forth below and when so requested
by Bank. Such statements shall include, at a minimum: a balance sheet; an income
and expense statement; a statement showing contingent liabilities; and any
supporting schedules or documentation which Bank may require. Each unaudited
statement must contain a certification to Bank of the statement's accuracy and
completeness signed by an authorized officer or the individual, as applicable.
Annual statements of business entities (including corporations and partnerships)
shall be audited by a certified public accountant reasonably acceptable to Bank
and shall be submitted no later than one hundred twenty (120) days after
16
fiscal year end. Interim statements shall be submitted within forty five (45)
days of each quarter end certified to Bank by the financial officer of Borrower.
Guarantor's personal financial statement shall be submitted to Bank prepared on
Bank's approved form within one hundred twenty (120) days of each calendar year
end. Borrower and Guarantor shall provide Bank with annual tax returns within
thirty (30) days of filing.
7.20 APPRAISALS. Bank must order, at Borrower's expense, and receive a
narrative discounted appraisal for the Land by an appraiser acceptable to Bank
prior to the Closing Date. In addition to the appraisals required by Bank prior
to closing of the Loan, updated appraisals shall be prepared at Borrower's
expense when requested by Bank not more than annually. Such appraisals shall be
prepared in accordance with written instructions from Bank and by a professional
appraiser selected and engaged by Bank. Borrower shall cooperate fully with the
appraisal process and shall allow the appraisers reasonable access to the
Project.
7.21 LEASES AFFECTING APPROVED PROJECT. Borrower shall not, without the
express prior written consent of Bank, enter into any lease affecting the
Approved Project or any part thereof.
7.22 ASSIGNMENT OF CONTRACTS. As additional security for the Loan and
for the performance by Borrower of all of its obligations hereunder, Borrower
hereby assigns to Bank all of Borrower's interest in any and all contracts,
agreements, permits, licenses, approvals, or other documents or writings
relating to the construction, leasing, management or operation of the
Improvements, including but not limited to the Construction Documents, the
architect's contract, the engineer's contract, site development contractor's and
the Plans. This assignment shall not, however, be deemed to impose upon Bank any
of Borrower's obligations under any such contract. Incident to the assignment of
the Construction Documents, the architect's contract, site development
contractor's contract, the engineer's contract, and the Plans, Borrower will
fulfill the obligations of Borrower thereunder, enforce the performance thereof
and give immediate notice to Bank of any default by the architect, site
development contractor, the engineer, or the General Contractor thereunder.
Further, Borrower will not, without the prior written consent of Bank (i)
materially modify, or amend the terms of the architect's contract, the Plans,
engineer's contract, site development contractor's contract or the Construction
Documents; or (ii) waive or release the performance of any material obligation
to be performed by the architect, the engineer, site development contractor or
the General Contractor thereunder.
7.23 SUBORDINATE FINANCING. Borrower shall not permit there to exist
nor shall Borrower obtain any subordinate or secondary financing of the Land or
any other property granted as security for the Loan, except for that certain
loan in favor of Amresco Funding Corporation, a Delaware corporation, which loan
is secured by that certain mortgage dated March 29, 1996 and recorded in
Official Records Book 24694 at Page 0744 of the Public Records of Broward
County, Florida and that certain contingent return mortgage dated March 29, 1996
and received in Official Records Book 24694 at Page 0787 of the Public Records
of Broward County, Florida, both of which have been voluntarily subordinated to
Bank's mortgages.
7.24 TRANSFER OF PROPERTY OF BORROWER. The Borrower shall not permit
any change in its ownership (or the ownership of its general partners, if
applicable), its corporate or trade name, the nature and operation of its
business or the nature and character of the Borrower or the Approved Project,
nor shall the Borrower sell, assign, transfer, hypothecate or dispose of all or
any portion of the Land, Improvements, or the Approved Project, except to
bonafide purchasers of individual lots under Firm Contracts and as may be
permitted hereby, without the prior written consent of Bank, which consent shall
be withheld or granted in Bank's sole and absolute discretion.
7.25 PARTIAL RELEASES OF PROPERTY. Provided the Borrower is not then in
Default hereunder, under the Note, the Mortgage or any other Loan Document, Bank
will provide partial releases in respect of its interest under the Mortgage and
other Loan Documents upon the terms and conditions set out in Exhibit "B"
attached. Payments made for releases shall be applied by Bank against the
outstanding principal of the Loan unless the release payment is calculated to
take into account allocable interest or other constituent costs or accruals, in
which event Bank may apply the release payment in accordance with such
calculations. Borrower agrees to reimburse Bank for all out-of-
17
pocket fees and costs, as set forth in Exhibits "B-1" and "B-2" hereto in
connection with the granting of such partial releases and shall provide Bank
with any and all information requested by Bank with respect to the Unit to be
released.
Notwithstanding anything contained herein to the contrary, if
Borrower applies for the partial release of a lot from the lien of the Mortgage
and other Loan Documents and there is not then any outstanding principal balance
under the Note, but there are outstanding letters of credit (either drawn or
undrawn upon) issued by Bank on Borrower's behalf which are secured by the
Mortgage (the "Secured Letters of Credit"), the Lot Release Price (computed in a
redefined manner as follows: that certain amount derived by dividing the sum of
all remaining outstanding letters of credit by the number of remaining developed
lots encumbered by the Mortgage) shall nevertheless be due and payable as a
precondition to Bank's obligation to grant a partial release or permit the
commencement of a Unit on a particular lot, as applicable, and the Lot Release
Prices paid for partial releases in this situation (collectively, the "Partial
Release Funds") shall be placed by Bank in an account in Borrower's name, which
account shall be pledged by Borrower to Bank as additional collateral for the
Loan and the indebtedness of Borrower to Bank arising out of the Secured Letters
of Credit. Borrower shall have no rights to make withdrawals or otherwise
receive disbursements from the pledged account. Borrower agrees to execute any
and all documents required by Bank to evidence the pledge of the Partial Release
Funds. If the Secured Letters of Credit are drawn, or if Borrower Defaults under
the Loan Documents, Bank may, in its sole and absolute discretion, and in
addition to any and all of its available rights and remedies under the Loan
Documents, the documents evidencing the Secured Letters of Credit, or otherwise,
apply the Partial Release Funds to reimburse Bank for any drawings made under
the Secured Letters of Credit and to any then outstanding balance under the
Loan. If said Secured Letters of Credit are reduced or released, the pledged
account will be reduced or released as well and shall be returned to Borrower.
Notwithstanding any provision herein to the contrary, if Bank at
its sole discretion has agreed to issue letters of credit for the performance of
site development work contemplated in this Agreement, sufficient availability
for funding such scope of work must exist under the Use of Proceeds for which
the letter of credit is being requested.
7.26 DISCLOSURE OF CONTRACTS AND NOTE. Borrower shall disclose to Bank
upon demand, the names of all persons with whom Borrower has contracted or
intends to contract for any construction or for the furnishing of labor or
materials therefor, and when required by Bank obtain the approval by Bank of all
such persons. Borrower shall upon Bank's request, at all times during the
construction period of any Improvements, provide to the Bank, within ten (10)
days of the Borrower's receipt thereof, copies of all notices to owner, claims
of lien, and demands for sworn statement of account, issued by any party,
whether pursuant to any notice of commencement or otherwise, in connection with
the Approved Project or the Land.
7.27 CONSTRUCTION LIEN LAW NOTIFICATION REQUIREMENTS. Borrower hereby
authorizes Bank to provide written notices to Contractor and lienors providing
notices to owner pursuant to ss.713.3471 (1)(a), Fla. Stat., and ss.713.3471
(2)(b), Fla. Stat., to the extent such notices are required by law. Borrower
hereby releases Bank and waives all claims it may have against Bank for damages
Borrower may incur as a result of Bank's failure to deliver said notices.
Borrower hereby agrees to provide all required notices to the Contractor and all
lienors providing notices to owner in compliance with ss.713.3471(2)(a), Fla.
Stat., in a timely fashion.
7.28 AMENDMENTS TO COST BREAKDOWN. If Borrower amends the Cost
Breakdown or reallocate items in the Cost Breakdown such that written notice to
the Contractor and lienors serving notices to owner would be required under
ss.713.3471(2)(a), Fla. Stat., (1992), Borrower agrees to provide written notice
to the Contractor and all required lienors in compliance with ss.713.3471
(2)(a), Fla. Stat., Bank shall not be obligated to make any disbursements of
Loan proceeds until Borrower has provided Bank with copies of any required
notices to the Contractor and required lienors in compliance with ss.713.3471
(2)(a), Fla. Stat., together with evidence that such notices have been
countersigned by the Contractor and all lienors who are required to receive the
notice under ss.713.3471 (2)(a), Fla. Stat., thereby confirming receipt thereof.
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7.29 AMENDMENT TO THE USE OF PROCEEDS. With the written authorization
of Borrower or Borrower's authorized representative only, as evidenced by
Borrower's Draw Request, Bank may amend the Use of Proceeds or reallocate funds
designated for specific line items to other line items. ________ Such amendment
may be evidenced by Borrower's Draw Request or by an Amended Use of Proceeds
Schedule and may be made without the consent of the Guarantors. Bank shall not
be permitted to reallocate items in the Use of Proceeds without the Borrower's
or Borrower's authorized representatives prior written consent.
7.30 LOAN FEES. Intentionally omitted.
7.31 MINIMUM NOTE REPAYMENT SCHEDULE. Intentionally omitted.
7.32 AMERICANS WITH DISABILITIES ACT. Borrower covenants and agrees
that, during the term of the Loan, to the extent such Act is applicable, the
Improvements and Approved Project will be in full compliance with the Americans
with Disabilities Act ("ADA") of July 26, 1990, 42 U.S.C Section 12191, et.
seq.) as amended from time to time, and the regulations promulgated pursuant
thereto. Borrower shall be solely responsible for all ADA compliance costs,
including without limitation, attorneys' fees and litigation costs, solely
relating to such period in which Borrower is the owner of the Land which
responsibility shall survive the repayment of the Loan and foreclosure of the
Land and Improvements.
7.33 REGULATION "Z". The Loan is exempt from the provisions of the
Federal Consumers Credit Protection Act (Truth-in-Lending Act) and Regulation
"Z" of the Board of Governors of the Federal Reserve System, because Borrower is
a person fully excluded therefrom, and/or because the Loan is only for business
or commercial purposes of Borrower and the proceeds of the Loan are not being
used for personal, household, family or agricultural purposes.
7.34 FINANCIAL COVENANTS. Borrower shall at all times be
prohibited from incurring or providing A guaranty for any additional debt,
except trade accounts payable in the ordinary course of business relative to the
Approved Project, or form pledging its assets to secure or guarantee any debt
other than that of the Borrower.
7.35 SUBORDINATION OF SHAREHOLDER LOANS. Borrower hereby subordinates,
to the prior payment to Bank of all sums owing under the Loan, any and all
loans, advances, and indebtedness owing from Borrower to shareholders of
Borrower from time to time, whether or not evidenced by promissory notes.
Borrower may make payments of principal and interest for any loan owing to its
shareholders until the Loan is paid in full so long as no Default exists under
the Loan.
ARTICLE VIII
REPRESENTATIONS AND WARRANTIES
8.1 REPRESENTATIONS AND WARRANTIES. Borrower hereby represents and
warrants to Bank that:
(a) REPRESENTATIONS AND WARRANTIES IN MORTGAGE AND GUARANTY. All
of the representations and warranties contained in the Mortgage and
Guaranty are true and correct and are incorporated herein by reference
as if set out in full.
(b) OTHER FINANCING. The Borrower has not (i) received any other
financing for the acquisition of or development and construction on the
Land existing as of the date hereof for which a lien equal to or
superior to Bank's mortgage could be successfully asserted, or (ii)
received any other financing for the construction of the Improvements.
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(c) PLANS. The Plans have been or will be prior to use approved by
the Borrower, the Guarantor, and each appropriate Governmental
Authority.
(d) GOVERNMENTAL REQUIREMENTS AND OTHER REQUIREMENTS. Borrower
will cause the Land to be developed and the Units to be constructed in
accordance with the Plans submitted to and approved by Bank, and when
so constructed the Land and the Units do and shall comply with all
covenants, conditions and restrictions affecting the Land or any
portion thereof, and do and shall comply with all Governmental
Requirements.
(e) USE OF THE APPROVED PROJECT. There is no (i) plan, study or
effort by any Governmental Authority or any nongovernmental person or
agency which may adversely affect the current or planned use of the
Approved Project, or (ii) to the best of Borrower's knowledge any
intended or proposed Governmental Requirement (including, but not
limited to, zoning changes) which may adversely affect the current or
planned use of the Approved Project.
(f) MORATORIUM. There is no moratorium or like governmental order
or restriction now in effect with respect to the Approved Project and,
to the best of Borrower's knowledge, no moratorium or similar ordinance
or restriction is now contemplated.
(g) PERMITS. All permits, approvals and consents of Governmental
Authorities and public and private utilities having jurisdiction
necessary in connection with the Approved Project have been or will be
issued and are or will be in good standing.
(h) CONDITION OF APPROVED PROJECT. No defect or condition of the
Land or the solid or geology thereof exists which will impair the
construction, use, or the operation of the Approved Project for its
intended purpose.
(i) LABOR AND MATERIALS. All labor and materials contracted for in
connection with the construction of the Improvements shall be used and
employed solely on the Land in said construction and only in accordance
with the Plans.
(j) SURVEYS. The Survey, the preliminary plat for the Land, and
all plot plans and other documents heretofore furnished by the Borrower
to Bank with respect to the Land and Improvements are accurate and
complete as of their respective dates. There are no encroachments onto
the Land and no improvements on the Land encroach onto any adjoining
property.
(k) CONSTRUCTION COSTS. The amount of the hard costs and soft
costs are accurate, true and correct and are satisfactory to Borrower.
(l) SALE OF SECURITIES. The Borrower has not instituted, caused to
be instituted or been a party to and, to the best of Borrower's
knowledge, there has not been any public offering with respect to the
Land and Improvements, or either, within the meaning of the Securities
Act of 1933 and the Securities Exchange Act of 1934.
(m) CONSTRUCTION LIEN LAW. At the time of Closing and at the time
of the recording of the Mortgage, no work has been done on Improvements
or on the Approved Project by the Borrower or anyone else acting for,
or on behalf of the Borrower, and no materials have been placed on the
Property by any materialmen or by anyone else. No Notice of
Commencement has been recorded in the Public Records with respect to
the Approved Project or the Land at the time of Closing. Borrower shall
not permit the commencement of any excavation or construction work of
any nature whatsoever, nor the delivery of any materials to the
Approved Project or the Land, prior to the recordation and posting of a
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Notice of Commencement as hereinafter set forth. Borrower shall execute
an appropriate Notice of Commencement and cause the same to be recorded
in the public records of the county in which the Property is located in
sequence after the recording of the Mortgage. Borrower shall post a
certified copy of the Notice of Commencement on the Approved Project,
in strict conformity with the Florida Construction Lien Law. If
construction is commenced prior to the recordation and posting of the
Notice of Commencement, or the Notice of Commencement is recorded prior
to the Mortgage, Bank shall have the absolute right to cancel this
Agreement and be immediately reimbursed by Borrower for all
disbursements of loan proceeds, together with expenses and reasonable
attorneys' fees incurred in, connection therewith. Construction shall
commence within ninety (90) days after recordation of the Notice of
Commencement. Construction shall proceed continuously in a workmanlike
manner. Bank reserves the right to require Borrower to furnish an
itemized cost breakdown for the Improvements to be constructed.
(n) REPRESENTATIONS AND WARRANTIES IN OTHER LOAN DOCUMENTS. All of
the representations and warranties contained in the other Loan
Documents are true and correct.
8.2 RELIANCE ON REPRESENTATIONS. The Borrower acknowledges that Bank
has relied upon the Borrower's representations and is not charged with any
knowledge contrary thereto that may be received by an examination of the public
records wherein the Land is located or that may have been received by any
officer, director, agent, employee or shareholder of Bank.
8.3 CERTIFICATE REGARDING LOAN STATUS. Upon Bank's request, Borrower
and Guarantors shall provide Bank with a written certification, certifying to
such matters related to the Loan as Bank may request, including, but not limited
to, a statement that Borrower and Guarantors are not in Default and that no
Default Conditions have occurred.
ARTICLE IX
EVENTS OF DEFAULT
9.1 DEFAULT. The occurrence of any one or more of the following events
(time being of the essence as to this Loan Agreement and all of its provisions)
constitutes a "Default" by Borrower under this Loan Agreement, and at the option
of Bank, under the other Loan Documents:
(a) SCHEDULED PAYMENT. Borrower's failure to make any payment
required under the Note when due or within any applicable grace period.
(b) MONETARY DEFAULT. Borrower's failure to make any other payment
required by this Loan Agreement or the other Loan Documents when due.
(c) OTHER. Borrower's failure to perform any other obligation
imposed upon Borrower by this Loan Agreement or any other Loan Document
within thirty (30) days after the date when performance is due. This
provision shall not be construed to provide Borrower with any grace
period in complying with any obligations imposed on Borrower by the
terms of the Loan Documents. Notwithstanding the foregoing provision,
Bank shall give Borrower notice, as defined in the Mortgage, of any
non-monetary default after which Borrower shall have a thirty (30) day
cure period.
(d) REPRESENTATION. Any representation or warranty of Borrower
contained in this Loan Agreement or in any certificate delivered
pursuant hereto, or in any other instrument or statement furnished in
connection herewith, proves to be incorrect or misleading in any
adverse respect as of the time when the same shall have been made,
including, without limitation, any and all financial statements,
operating
21
statements, and schedules attached thereto, furnished by Borrower or
any guarantor of the Loan to Bank or pursuant to any provision of this
Loan Agreement,
(e) BANKRUPTCY. Borrower or any general partner of Borrower or any
guarantor of the Loan (i) files a voluntary petition in bankruptcy or a
petition or answer seeking or acquiescing in any reorganization or for
an arrangement,, composition, readjustment, liquidation, dissolution,
or similar relief for itself pursuant to the United State Bankruptcy
Code or any similar law or regulation, federal or state, relating to
any relief for debtors, now or hereafter in effect; or (ii) makes an
assignment for the benefit of creditors or admits in writing its
inability to pay or fails to pay its debts as they become due; or (iii)
suspends payment of its obligations or takes any action in furtherance
of the foregoing; or (iv) consents to or acquiesces in the appointment
of a receiver, trustee, custodian, conservator, liquidator or other
similar official of Borrower, a general partner of Borrower, or any
guarantor, for all or any part of the Collateral or other assets of
such party, or either; or (v) has filed against it an involuntary
petition, arrangement, composition, readjustment, liquidation,
dissolution, or an answer proposing an adjudication of it as a bankrupt
or insolvent, or is subject to reorganization pursuant to the United
States Bankruptcy Code, an action seeking to appoint a trustee,
receiver, custodian, or conservator or liquidator, or any. similar law,
federal or state, now or hereinafter in effect, and such action is
approved by any court of competent jurisdiction and the order approving
the same shall not be vacated or stayed within sixty (60) days from
entry; or (vi) consents to the filing of any such petition or answer,
or shall fail to deny the material allegations of the same in a timely
manner.
(f) JUDGMENTS. (1) A final judgment other than a final judgment in
connection with any condemnation is entered against Borrower,
Guarantors, or any general partner of Borrower, that (i) adversely
affects the value, use or operation of the Land or the Improvements in
Bank's sole judgment, or (ii) adversely affects, or may adversely
affect, the validity, enforceability or priority of the lien or
security interest created by the Mortgage or any other Loan Document in
Bank's sole judgment, or both; or (2) execution or other final process
issues thereon with respect to the Land or the Improvements; and (3)
Borrower, Guarantor, or any general partner of Borrower, does not
discharge the same or provide for its discharge in accordance with its
terms, or procure a stay of execution thereon, in any event within
thirty (30) days from entry, or Borrower shall not, within such period
or such longer period during which execution on such judgment shall
have been entered, and cause its execution to be stayed during such
appeal, or if on appeal such order, decree or process shall be affirmed
and Borrower shall not discharge such judgment or provide for its
discharge in accordance with its terms within sixty (60) days after the
entry of such order or decree or affirmance, or if any stay of
execution on appeal is released or otherwise discharged.
(g) LIENS. Any federal, state or local tax lien or any claim of
lien for labor or materials or any other lien or encumbrance of any
nature whatsoever is recorded against Borrower or the Land or
Improvements and is not removed by payment or transferred to substitute
security in the manner provided by law, within thirty (30) days after
it is recorded in accordance with applicable law.
(h) OTHER NOTES OR MORTGAGES. Borrower's default in the
performance or payment of Borrower's obligations under any other note
which remains uncured after any applicable grace period, or under any
other mortgage encumbering all or any part of the Land or the
Improvements, if the other mortgage is permitted by the Bank, whether
such other note or mortgage is held by Bank or by any other party, and
unless otherwise agreed to by separate written agreement between Bank
and such other mortgage holder.
(i) BORROWER DEFAULT UNDER LOAN DOCUMENTS. Borrower's default in
the payment or performance of any of Borrower obligations under any of
the Loan Documents, including this Loan Agreement and any riders
thereto.
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(j) GUARANTOR DEFAULT.
i) The default after expiration of any applicable grace period
in the payment or performance of any obligation of a Guarantor of
the Note arising under its guaranty or pursuant to any other Loan
Documents; or
ii) The death of any Guarantor and the failure of Borrower to
provide Bank with an alternate guaranty or alternate collateral
satisfactory to Bank in its sole and absolute discretion within
sixty (60) days of the date of Guarantor's death.
(k) BORROWERS/GENERAL PARTNER'S CONTINUED EXISTENCE. Borrower or
any corporate General Partner of Borrower shall cease to exist or to be
qualified to do or transact business in the State in which the Land and
Improvements are located, or shall be dissolved or shall be a party to
a merger or consolidation, or shall sell all or substantially all of
its assets, or shall change its corporate name or trade name without
prior written notice to Bank.
(1) STOCK IN BORROWER/CHANGE IN PARTNERS. If Borrower is a limited
partnership and without the prior written consent of Bank, any shares
of stock of any corporate general partner of Borrower are issued, sold,
transferred, conveyed, assigned, mortgaged, pledged, or otherwise
disposed of so as to result in change of control of Borrower, whether
voluntarily or by operation of law, and whether with or without
consideration, or any agreement for any of the foregoing is entered
into; or, if any general partnership interest or other equity interest
in the Borrower is sold, transferred, assigned, conveyed, mortgaged,
pledged, or otherwise disposed of, whether voluntarily or by operation
of law, and whether with or without consideration, or any agreement for
any of the foregoing is entered into, or any general partner of
Borrower withdraws from the partnership.
(m) TRANSFER OF PROPERTY OR OWNERSHIP. Any sale, conveyance,
transfer, assignment, or other disposition or encumbrance of all or any
part of the Land, Improvements, or the Approved Project, or any
ownership interest in Borrower or any guarantor without the prior
consent of Bank or except as otherwise permitted hereby, or as outlined
in the prospectus for public offering for Transeastern Properties,
Inc., a Florida corporation delivered to Bank by Borrower.
(n) FALSE STATEMENT. Any statement or representation of Borrower
or any guarantor contained in the loan application or any financial
statements or other materials furnished to Bank or any other Bank prior
or subsequent to the making of the Loan secured hereby are discovered
to have been false or incorrect or incomplete.
(o) DEFAULT UNDER INDEMNITY. Borrower or Guarantor shall default
after any applicable grace period under any obligation imposed by any
indemnity contained within any of the Loan Documents including the
Hazardous Waste Certification and Indemnification. .
(p) CROSS-DEFAULT. Any monetary default by the Borrower or
Guarantor under this Loan shall be a default under all other documents,
instruments, mortgages and other collateral documents evidencing and
securing all other loans by Bank to Borrower or Guarantor.
(q) NON-COMPLIANCE WITH THE PLANS AND SPECIFICATIONS. Failure of
any of the materials supplied for the development of the Land or the
construction of the Units to comply with the Plans and Specifications
or any requirements of any Governmental Authority unless the Borrower
undertakes and diligently pursues the correction of such failure.
23
(r) PROJECTED COMPLETION OF CONSTRUCTION. Failure to construct the
Improvements with reasonable dispatch, or the discontinuance of
construction at any time for a period of fifteen (15) days
consecutively, or determination by Bank that construction of the
Improvements will not be timely completed and Borrower's failure to
complete, cure or provide satisfactory assurances after notice or
demand from Bank. Notwithstanding the foregoing, any delays in the
event of unavailability of materials at reasonable cost, strikes, other
labor problems, governmental orders, acts of God or other events which
would support a defense based upon impossibility of performance for
reasons beyond the control of Borrower shall not be a Default under
this paragraph.
(s) NON-PAYMENT OF DEBTS. Borrower is generally not paying its
debts as such debts become due.
(t) SECURITIES LAWS VIOLATION. The assertion of any violation of
the 1933 Securities Act, 1934 Securities Act or the Florida Blue Sky
Laws by any Governmental Authorities or the institution of any
securities litigation not dismissed within sixty (60) days of the
commencement of same.
(u) NON-COMPLIANCE WITH HOMEOWNER ASSOCIATION DOCUMENTS. Borrower
shall fail to perform any duty required of it, fulfill any condition,
abide by any covenant or in any manner default under the homeowners,
association documents encumbering the Approved Project, if any.
(v) ADVERSE ACTIONS. Any legal or equitable action is commenced
against Borrower which, if adversely determined, could reasonably be
expected to impair substantially the ability of Borrower to perform
each and every obligation under the Loan Documents and this Agreement;
provided, however, if Borrower has commenced a counter action, contest
or defense to the adverse action and resolved such adverse action
within one hundred twenty (120) days of the commencement of same then
Borrower shall not be in Default.
(w) GOVERNMENT CHALLENGES. The validity of any permit, approval or
consent by any Governmental Authority relating to the Land, the
Improvements, or the Approved Project, or the operation thereof is
challenged by a proceeding before a board, commission, agency, court or
other authority having jurisdiction; provided, however, if Borrower has
commenced a counter action, contest or defense to the governmental
challenge and resolved such challenge within one hundred twenty (120)
days of the commencement of same then Borrower shall not be in Default.
(x) BORROWER'S ACTIONS. Any action by the Borrower, which would,
in the sole opinion of the Bank, significantly endanger the security of
the Loan and which Borrower fails to mitigate after notice from Bank
will render the Loan payable on demand.
(y) MISCELLANEOUS. If at any time the Bank shall determine that
there has been a material adverse change in the financial condition or
prospects of Borrower, the Guarantor, or any general partner of
Borrower, which is not corrected or cured after reasonable notice from
Bank.
ARTICLE X
BANK'S RIGHTS AND REMEDIES
The following rights and remedies are available to Bank:
10.1 ACCELERATION. Upon the occurrence of a Default, the entire unpaid
principal balance of the Loan and all accrued but unpaid interest thereon and
any costs or expenses then due to Bank and any and all other
24
obligations of Borrower to Bank, shall, at the option of Bank and without notice
to Borrower, become immediately due and payable.
10.2 COMPLETION OF CONSTRUCTION. From and after the occurrence of a
Default, Bank shall be entitled to have and use the Plans And the Construction
Documents and, after first having given written notice to the architect, site
development contractor, the engineer, or the General Contractor, shall be
entitled from and after such notice to enjoy and enforce all of the rights of
Borrower under the architect's contract, engineer's contract, site development
contractor's contract, the Plans or the Construction Contracts. Borrower hereby
irrevocably constitutes and appoints Bank its true and lawful attorney-in-fact
with full power of substitution in the Approved Project to complete the
Improvements in the name of Borrower following a Default. Borrower hereby
empowers Bank from and after Default as its attorney-in-fact as follows: (a) to
use any funds of Borrower, including any Loan proceeds or equity deposits which
may remain undisbursed hereunder, for the purpose of completing the Improvements
in accordance with the Plans; (b) to make such additions, changes,
modifications, or corrections in, or deviations from, the Plans as shall be
necessary or desirable to complete the Improvements; (c) to employ such
contractors, subcontractors, agents, architects, engineers, inspectors, or other
parties as shall be required for said purposes; (d) to pay, settle, or
compromise all existing bills and claims which may be liens against the
Improvements or as xxx.xx necessary or desirable in the sole discretion of Bank
for the completion of the Improvements or for clearance of title; (e) to direct
use of and/or use all or any part of the labor, materials, supplies and
equipment contracted for, owned by, or under the control of Borrower, whether or
not previously incorporated into the Improvements; (f) to execute all
applications and certificates in the name of Borrower which may be required by
the Construction Documents, the architect's contract, the engineer's contract,
site development contractor's contract, Plans, or any of the contract documents;
(g) to prosecute and defend all actions or proceedings in connection with the
Approved Project or the construction of the Improvements and take such action
and require such performance as Bank shall deem necessary under any performance
or payment bond; and (h) to do any and every act with respect to construction or
completion of the Improvements or the closing of any permanent financing which
Borrower might do in its own behalf including, without limitation, execution,
acknowledgment, and delivery of all instruments, documents, and papers in the
name of Borrower as may be necessary or desirable in the sole discretion of
Bank. It is further understood and agreed that this power of attorney which
shall be deemed to be a power coupled with an interest, cannot be revoked. All
sums expended by Bank pursuant hereto shall be deemed to have been disbursed to
Borrower and secured by the Security Documents, and the other Loan Documents.
10.3 DISPUTES. Where disputes have arisen which, in the opinion of
Bank, may endanger timely completion of the Improvements or fulfillment of any
condition or covenant herein, Bank may agree to disburse Loan proceeds for the
account of Borrower without prejudice to Borrower's rights, if any, to recover
said proceeds from the party to whom paid. Such agreement or agreements may take
the form which Bank in its discretion deems proper, including, but without
limiting the generality of the foregoing, agreements to indemnify (on behalf of
Borrower and/or for Bank's own account) any title insurer against possible
assertion of lien claims, agreements to pay disputed amounts and the like. All
sums paid or agreed to be paid pursuant to such undertaking shall be advances of
Loan proceeds.
10.4 REMEDIES CUMULATIVE: NONWAIVER: JUDGMENTS. All remedies of Bank
provided for herein or in the other Loan Documents are cumulative and shall be
in addition to any and all other rights and remedies provided for or available
under the other Loan Documents, at law or in equity. The exercise of any right
or remedy by Bank hereunder shall not in any way constitute a cure or waiver of
a Default Condition or a Default hereunder or under the Loan Documents, or
invalidate any act done pursuant to any notice of the occurrence of a Default
Condition or Default, or prejudice Bank in the exercise of any of its rights
hereunder or under any of the other Loan Documents, unless, in the exercise of
said rights, Bank realizes all amounts owed to it under the Loan Documents. ANY
JUDGMENT IN FAVOR OF BANK AGAINST BORROWER SHALL BEAR INTEREST AT THE DEFAULT
RATE (AS DEFINED IN THE NOTE).
10.5 NO LIABILITY OF BANK. Whether or not Bank elects to employ any or
all remedies available to it in the event of an occurrence of a Default
Condition or Default, Bank shall not be liable for the construction of or
25
failure to construct or complete or protect the Improvements or for payment of
any expense incurred in connection with the exercise or any remedy available to
Bank or for the construction or Completion of the Improvements or for the
performance or nonperformance of any other obligation of Borrower.
10.6 SECURITY INTEREST. It is understood and agreed that Bank shall
have and enjoy and is hereby granted a lien on, and a security interest in, all
collateral described in the Mortgage, and including without limitation, any and
all materials (stored on-site or off-site), reserves, deferred payments,
deposits or advance PAYments for materials (stored on-site or off-site)
undisbursed Loan proceeds, insurance refunds, impound accounts, refunds for
overpayment of any kind, and such lien and security interest shall constitute
additional security for the Indebtedness of Borrower to Bank, and Bank shall
have and possess any and all rights and remedies of a secured party provided by
law with respect to enforcement of and recovery on its security interest on such
items and amounts. In the event of a conflict between this paragraph and any
security interest granted pursuant to the Mortgage, the Mortgage shall control.
10.7 CESSATION OF FUNDING. Upon the occurrence of a Default, Bank shall
have the right to immediately terminate further funding of the Loan irrespective
of completion.
ARTICLE XI
GENERAL CONDITIONS
The following conditions shall be applicable throughout the term of
this Loan Agreement:
11.1 WAIVERS. No waiver of any Default Condition or Default or breach
by Borrower hereunder shall be implied from any delay or omission by Bank to
take action on account of such Default Condition or Default, and no express
waiver shall affect any Default Condition or Default other than the Default
specified in the waiver and it shall be operative only for the time and to the
extent therein stated. Waivers of any covenants, terms or conditions contained
herein must be in writing and shall not be construed as a waiver of any
subsequent breach of the same covenant, term or condition. The consent or
approval by Bank to or of any act by Borrower requiring further consent or
approval shall not be deemed to waive or render unnecessary the consent or
approval to or of any subsequent or similar act. No single or partial exercise
of any right or remedy of Bank hereunder shall preclude any further exercise
thereof or the exercise of any other or different right or remedy.
11.2 BENEFIT. This Loan Agreement is made and entered into for the sole
protection and benefit of Bank and Borrower, their successors and assigns, and
no other person or persons have any right to action hereon or rights to the Loan
all proceeds at any time, nor shall Bank owe any duty whatsoever to any claimant
for labor or services performed or material furnished in connection with the
Approved Project, or to apply any undisbursed portion of the Loan to the payment
of any such claim, or to exercise any right or power of Bank hereunder or
arising from any Default Condition or Default by Borrower.
11.3 ASSIGNMENT. The terms hereof shall be binding upon and inure to
the benefit of the heirs, successors, assigns, and personal representatives of
the parties hereto; provided, however, that Borrower shall not assign this Loan
Agreement or any of its rights, interests, duties or obligations hereunder or
any Loan proceeds or other moneys to be advanced hereunder in whole or in part
without the prior written consent of Bank and that any such assignment (whether
voluntary or by operation of law) without said consent shall be void. It is
expressly recognized and agreed that Bank may assign this Loan Agreement, the
Note, the Security Documents, and any other Loan Documents, in whole or in part,
to any other person, firm, or legal entity provided that all of the provisions
hereof shall continue in full force and effect and, in the event of such
assignment, Bank shall thereafter be relieved of all liability under the Loan
Documents and any Loan disbursements made by any assignee shall be deemed made
26
in pursuant and not in modification hereof and shall be evidenced by the Note
and secured by the Security Documents and any other Loan Documents.
11.4 AMENDMENTS. This Loan Agreement shall not be amended except by a
written instrument signed by all parties hereto.
11.5 TERMS. Whenever the context and construction so require, all words
used in the singular number herein shall be deemed to have been used in the
plural, and vice versa, and the masculine gender shall include the feminine and
neuter and the neuter shall include the masculine and feminine.
11.6 GOVERNING LAW AND JURISDICTION. This Loan Agreement and the other
Loan Documents and all matters relating thereto shall be governed by and
construed and interpreted in accordance with the laws of the State of Florida.
Borrower and all of its general partners hereby submits to the jurisdiction of
the state and federal courts located in Florida and agree that Bank may, at its
option, enforce its rights under the Loan Documents in such courts.
11.7 PUBLICITY. At Bank's request and expense, and subject to
applicable laws, regulations and restrictions, Borrower shall place upon the
Approved Project, at a location mutually acceptable :to Borrower and Bank, a
sign or signs advertising the fact that financing is being provided by Bank.
Bank shall also have the right to secure printed publicity through newspaper and
other media concerning the Approved Project and source of financing.
11.8 SAVINGS CLAUSE. Invalidation of any one or more of the provisions
of this Loan Agreement shall in no way affect any of the other provisions
hereof, which shall remain in full force and effect.
11.9 EXECUTION IN COUNTERPARTS. This Loan Agreement may be executed in
two or more counterparts, each of which shall be deemed to be an original, but
all of which shall constitute one and the same instrument, and in making proof
of this Loan Agreement, it shall not be necessary to produce or account for more
than one such counterpart.
11.10 CAPTIONS. The captions herein are inserted only as a matter of
convenience and for reference and in no way define, limit or describe the scope
of this Loan Agreement nor the intent of any provision hereof.
11.11 NOTICES. All notices required to be given hereunder shall be
given in accordance with the requirements of the Mortgage.
11.12 MANDATORY ARBITRATION. Any controversy or claim between or among
the parties hereto including but not limited to those arising out of or relating
to this Loan Agreement or any related agreements or instruments, including any
claim based on or arising from an alleged tort, shall be determined by binding
arbitration in accordance with the Federal Arbitration Act (or if not
applicable, the applicable state law) , the Rules of Practice and Procedure for
the Arbitration of Commercial Disputes of Judicial Arbitration and Mediation
Services, Inc. (J.A.M.S.), and the "Special Rules" set forth below. In the event
of any inconsistency, the Special Rules shall control. Judgment upon any
arbitration award may be entered in any court having jurisdiction. Any party to
this Loan Agreement may bring an action, including a summary or expedited
proceeding, to compel arbitration of any controversy or claim to which this Loan
Agreement applies in any court having jurisdiction over such action.
(a) SPECIAL RULES. The arbitration shall be conducted in the
County of Broward, Florida and administered by Endispute, Inc., d/b/a
J.A.M.S./Endispute who will appoint an arbitrator; if
J.A.M.S./Endispute is unable or legally precluded from administering
the arbitration, then the American Arbitration Association will serve.
All arbitration hearings will be commenced within 90 days of the
27
demand for arbitration; further, the arbitrator shall only, upon a
showing of cause, be permitted to extend the commencement of such
hearing for up to an additional 60 days.
(b) RESERVATION OF RIGHTS. Nothing in this Loan Agreement shall
be deemed to (i) limit the applicability of any otherwise applicable
statutes of limitation or repose and any waivers contained in this Loan
Agreement; or (ii) be a waiver by the Bank of the protection afforded
to it by 12 U.S.C. Sec. 91 or any substantially equivalent state law;
or (iii) limit the right of the Bank hereto (A) to exercise self help
remedies such as (but not limited to) setoff, or (B) to foreclose
against any real or personal property collateral, or (C) to obtain from
a court provisional or ancillary remedies such as (but not limited to)
injunctive relief or the appointment of a receiver. The Bank may
exercise such self help rights, foreclose upon such property, or obtain
such provisional or ancillary remedies before, during or after the
pendency of any arbitration proceeding brought pursuant to this
Agreement. At Bank's option, foreclosure under a deed of trust or
mortgage may be accomplished by any of the following: the exercise of a
power of sale under the deed of trust or mortgage, or by judicial sale
under the deed of trust or mortgage, or by judicial foreclosure.
Neither this exercise of self help remedies nor the institution or
maintenance of an action for foreclosure or provisional or ancillary
remedies shall constitute a waiver of the right of any party, including
the claimant in any such action, to arbitrate the merits of the
controversy or claim occasioning resort to such remedies.
11.13 DISBURSEMENT OF CONSTRUCTION LINE FUNDS AT RENEWAL. Intentionally
omitted.
IN WITNESS WHEREOF, Borrower and Bank have executed this Loan Agreement
as of the above written date.
Signed, sealed and delivered
in the presence of TRANSEASTERN PEMBROKE VILLAGES, INC.,
a Florida corporation
_______________________________
Witness #1 By __________________________________(SEAL)
_______________________________ Xxxxxx Xxxxxxx, Executive Vice President
Print Name
_______________________________
Witness #2 Address:
_______________________________
Print Name 0000 Xxxxxxxxxx Xxxxx
Xxxxx Xxxxxxx, Xxxxxxx 00000
CHASE FEDERAL BANK, a Federal Savings
Bank, a Division of NATIONSBANK, N.A.
(SOUTH), a national banking association
_______________________________
28
Witness #1 _____________________________________(SEAL)
________________________________ Xxxxx X. Xxxx, Real Estate Banking Officer
Print Name
________________________________
Witness #2 Address:
________________________________
Print Name 000 Xxxx Xxxxxxx Xxxxx Xxxx
Xxxxx 000
Xx. Xxxxxxxxxx, Xxxxxxx 00000
29
JOINDER OF GUARANTORS
The undersigned as Guarantor hereby joins in and consents to the
foregoing Loan Agreement.
________________________________
Witness #1
________________________________
Print Name
___________________________________
________________________________ Xxxxxx Xxxxxxx
Witness #2
________________________________
Print Name
________________________________
Witness #1
________________________________
Print Name
___________________________________
________________________________ Xxxxxx Xxxxxxx
Witness #2
________________________________
Print Name
________________________________
Witness #1
________________________________
Print Name
___________________________________
________________________________ Xxxxxx Xxxxx
Witness #
________________________________
Print Name
________________________________ Transeastern Properties, Inc.,
Witness #1 a Florida corporation, f/k/a
________________________________ Transeastern Properties of South,
Print Name Inc., a Florida corporation
By __________________________(SEAL)
________________________________ Xxxxxx Xxxxxxx, President
Witness #2
________________________________
Print Name
30
EXHIBITS
1. Exhibit "A-1": Draw Sheets / Use of Proceeds - Pelican Pointe
2. Exhibit "A-2": Draw Sheets / Use of Proceeds - Egret's Way
3. Exhibit "A-3": P.U.D. Development
4. Exhibit "B-1": Partial Release - Pelican Pointe
5. Exhibit "B-2": Partial Release - Egret's Way
6. Exhibit "C": Intentionally Omitted
7. Exhibit "D": Intentionally Omitted
8. Exhibit "E": Site Plans
9. Exhibit "F": Legal Description
31
EXHIBIT "A-1" - DRAW SHEETS/USE OF PROCEEDS
PARCEL "D" - "PELICAN POINTE"
EXHIBIT "A-2" - DRAW SHEETS/USE OF PROCEEDS
PARCEL "F" - "EGRET'S WAY"
EXHIBIT "A-3" - P.U.D. DEVELOPMENT
Balance of Development Work to be Funded under
Loan Agreement dated March 29, 1996 $ 288,668.45
Interest Reserve 151,948.65
EXHIBIT B-1
PARCEL "D" - "PELICAN POINTE"
PARTIAL RELEASES
1. PARTIAL RELEASES UNDER THE NOTE. Provided that Borrower is not then
in Default hereunder, under the Note, the Mortgage or any other Loan Document,
Bank will provide partial releases of individual lots from the Note upon the
following terms:
a. Bank shall be given written notice of the request for each
partial release at least five (5) business days prior to each partial
release.
b. The cost of each partial release, including reasonable attorney's
fees for Bank's attorney, shall be paid by Borrower.
c. Contemporaneously with the delivery to Borrower of each partial
release, Borrower shall prepay principal equal to THIRTY ONE THOUSAND
SIX HUNDRED FIFTY THREE AND NO/100 DOLLARS ($31,653.00) per developed
lot (the "Lot Release Price"). If the value or total amount funded
changes materially, in the sole discretion of Bank, Bank reserves the
right to modify the Lot Release Prices. Such change in Lot Release
Price will be based on relative value of the collateral subject to the
originally contemplated average Lot Release Price set forth above based
on one hundred twenty percent (120%) accelerated lot release pricing.
EXHIBIT B-2
PARCEL "F" - "EGRET'S WAY"
PARTIAL RELEASES
1. PARTIAL RELEASES UNDER THE NOTE. Provided that Borrower is not then
in Default hereunder, under the Note, the Mortgage or any other Loan Document,
Bank will provide partial releases of individual lots from the Note upon the
following terms:
a. Bank shall be given written notice of the request for each
partial release at least five (5) business days prior to each partial
release.
b. The cost of each partial release, including reasonable attorney's
fees for Bank's attorney, shall be paid by Borrower.
c. Contemporaneously with the delivery to Borrower of each partial
release, Borrower shall prepay principal equal to NINETEEN THOUSAND
THREE HUNDRED FORTY FIVE AND NO/100 DOLLARS ($19,345.00) per developed
lot (the "Lot Release Price"). If the value or total amount funded
changes materially, in the sole discretion of Bank, Bank reserves the
right to modify the Lot Release Prices. Such change in Lot Release
Price will be based on relative value of the collateral subject to the
originally contemplated average Lot Release Price set forth above based
on one hundred twenty percent (120%) accelerated lot release pricing.
EXHIBIT "C"
INTENTIONALLY OMITTED
EXHIBIT "D"
INTENTIONALLY OMITTED
EXHIBIT "E"
SITE PLANS
EXHIBIT "F"
LEGAL DESCRIPTION
Portions of the NASHER PLAT, according to the Plat thereof as recorded
at Plat Book 159 at Page 42, of the Public Records of Broward County
more particularly described as follows:
CONSTRUCTION LOAN
AGREEMENT
BY AND BETWEEN
TRANSEASTERN PEMBROKE VILLAGES, INC.
A FLORIDA CORPORATION
(THE "BORROWER")
AND
CHASE FEDERAL BANK, A FEDERAL SAVINGS BANK, A DIVISION OF
NATIONSBANK, N.A. (SOUTH), A NATIONAL BANKING ASSOCIATION
ORGANIZED AND EXISTING UNDER THE LAWS OF THE UNITED STATES
(THE "BANK")
PELICAN POINTE
(THE "APPROVED PROJECT")
DATED: SEPTEMBER ____, 1996
XXXXXXX X. XXXX, ESQ.
XXXXXXX XXXXXXX & XXXXX XXXXX
0000 XXXXXXX XXXX
XXXXX 000
XXXXX XXXXX, XXXXXXX 00000
(000) 000-0000
Loan No. 91004439
THIS LOAN AGREEMENT, dated as of the _____ day of September, 1996 (the
"Loan Agreement" or "Agreement"), is made by and between TRANSEASTERN PEMBROKE
VILLAGES, INC., A FLORIDA CORPORATION, with its principal place of business at
0000 Xxxxxxxxxx Xxxxx, Xxxxx Xxxxxxx, Xxxxxxx 00000 ("Borrower"), and CHASE
FEDERAL BANK, A FEDERAL SAVINGS BANK, A DIVISION OF NATIONSBANK, N.A. (SOUTH), a
national banking association organized and existing under the laws of the United
States, with its offices located at 000 Xxxx Xxxxxxx Xxxxx Xxxx, Xxxxx 000, Xxxx
Xxxxxxxxxx, Xxxxxxx 00000 ("Bank").
RECITALS
A. Borrower has applied to Bank for a loan in the principal amount of
THREE MILLION FOUR HUNDRED THOUSAND AND NO/100 DOLLARS ($ 3,400,000.00) (the
"Loan") to be used for the purpose of the constructing of three hundred fifty
six townhome dwellings on such individual lots now owned by Borrower in fee
simple and mortgaged to Bank as security for the Loan, which lots are to be
located in a certain residential development known as Pelican Pointe located
upon certain property in Broward County, Florida.
B. Bank has agreed to establish a note and mortgage structure under
which advances may be made for the land acquisition, development and the
construction of single family residential dwellings on individual lots in
accordance with plats, specifications, terms, and conditions approved by Bank.
C. Bank is willing to make the Loan described above based on the
terms and conditions set forth in this Loan Agreement and in the Loan Documents
referred to herein.
NOW, THEREFORE, in consideration of the premises, of the Loan advances
which are to be agreed to be made by Bank to Borrower hereinafter and the notes
and mortgage given by Borrower in evidence thereof, and for other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, Borrower and Bank hereby agree as follows:
ARTICLE I
DEFINITIONS
1.1 For the purposes hereof:
(a) "Approved Project" or "Project" means the collective
reference to the development identified in Section 2.4 of this
Agreement, together with the Land, the Improvements, rights, property,
and appurtenances as defined, described or identified in the Mortgage,
and means, as the context may require, an individual Unit, as well as
the aggregate of all such Units.
(b) "Architect" or "Supervising Architect" means that party
who will serve as Borrower's architect in conjunction with the
construction of Units and common amenities to be constructed in the
Approved Project. Bank's Construction Consultant and Borrower's
architect shall not be the same person or firm.
(c) "Architect's Contract" means the contract between
Borrower and the Architect "Architect's Contract" shall also mean
Borrower's design architect's contract.
(d) "Borrower's Representative" means the person or persons
designated in writing to Bank by Borrower as being authorized to submit
Draw Requests on Borrower's behalf and to consent to changes in the
Cost Breakdown and Use of Proceeds. Unless and until changed by written
notice to Bank, BorroWer designates any one of the following: Xxxxxx
Xxxxxxx or Xxx Xxxxxxxx as its Borrower's Representative(s).
(e) "Closing Date" means the date as of which this Loan
Agreement is executed by Borrower and Bank.
(f) "Collateral" means the Mortgaged Property, Rents,
Intangible Property and other property rights as defined in and
encumbered by the Mortgage.
(g) "Commitment" means Bank's commitment letter to Borrower
dated July 1, 1996 and all amendments thereto. The parties intend that
this Agreement and the Loan Documents shall supersede and replace the
Commitment.
(h) "Completion means completion of the Improvements in
accordance with the Plans, such Completion to be evidenced by
satisfaction of the conditions of Section 6.3 plus the installation of
any required items of personalty in substantial compliance with the
Plans, free and clear of liens or claims of liens or other
encumbrances, except Permitted Encumbrances;
(i) "Construction Documents" means the stipulated sum
construction contract between Borrower and the General Contractor, if a
General Contractor is engaged, and all other contracts, plans or
documents concerning the construction of the Improvements and any
addenda, amendments or modifications thereto. The Construction
Documents shall include a hard cost breakdown and a maximum fixed cost
for the performance of all services, labor, and materials furnished
thereunder.
(j) "Construction Inspector" means the architectural or
engineering firm or such party which Bank shall designate to perform
various services on behalf of Bank. The services to be performed by
Bank's Construction Inspector shall include the issuance of reports and
certifications solely for the benefit of Bank and shall not impose upon
Bank any obligation to make inspections, or to correct or require any
other person to correct any defects, or to notify any person with
respect to such defects, review of the Plans and all proposed changes
to them, preparation of a "cost breakdown" construction analysis (the
"Construction Analysis"), periodic inspections of construction work for
conformity with the Plans, and approval of Draw Requests.
(k) "Cost Breakdown" means the detailed trade breakdown of
the cost of constructing the Improvements and an itemization of
non-construction and Land costs, all as approved by Bank from time to
time.
(1) "Default" means a violation of any term, covenant, or
condition hereunder or a Default as defined under any of the other Loan
Documents which remains uncured after any applicable grace period.
(m) "Default Condition" means the occurrence or existence of
an event or condition which, upon the giving of notice or the passage
of time, or both, would constitute a Default.
(n) "Draw Request" means a written or verbal request for any
disbursement of Loan proceeds, which shall be submitted for each
requested disbursement as set forth in Article III hereof, in
accordance with the draw request sheet attached hereto as EXHIBIT "A"
attached hereto and incorporated herein by reference.
2
(o) "Engineer" shall mean such party who will serve as
Borrower's supervising engineer in accordance with the Plans and
specifications;
(p) "Engineering Contract" means the "full service",
contract between Borrower and Engineer which shall require engineering
services throughout the Land development and construction contemplated
under the Loan.
(q) "Financing Statements" means the UCC financing
statements filed in order to perfect Bank's lien on certain personal
property and fixtures as more particularly described therein.
(r) "Firm Contract" means an arm's length, bona-fide binding
contract for purchase and sale, in form and content satisfactory to
Bank, for the sale of a Unit to a purchaser unaffiliated and unrelated
to Borrower or Guarantor, under which (i) Borrower has received a cash
deposit equal to ten percent (10%) of the purchase price except as
herein after provided; (ii) Borrower is not obligated to provide any
purchase-money financing, (iii) all applicable statutory cancellation
or rescission periods have expired, (iv) there are no contingencies
other than a first mortgage financing contingency for which Borrower
has confirmed to Bank that purchaser has made a mortgage application
and has received a mortgage commitment without contingencies, (v) the
closing date for the contract is within forty-five (45) days of the
date of issuance of the Certificate of occupancy for the Unit, and (vi)
the gross sales price, after payment of all of Borrower's closing
expenses thereunder, will result in sufficient proceeds to pay to Bank
the Unit Release Price and Lot Release Price. The purchaser's interest
in the Mortgaged Property and under the Firm Contract must be expressly
subordinated to the lien and operation of Bank's Mortgage, either by
separate subordination agreement in favor of Bank or pursuant to the
terms of the Firm Contract.
(s) "General Contractor" means Borrower who will serve as
the general contractor in accordance with the Construction Documents;
if a General Contractor is not engaged or is not named here, any
obligation of the General Contractor referred to in the Loan Documents
shall be the obligation of the Borrower to perform or to cause to be
performed.
(t) "Governmental Authorities" means any local, state, or
federal governmental agency, regulatory body or office, or any
quasi-governmental office (including health and environmental), or any
officer or official of any such agency, office, or body whose consent
or approval is required as a prerequisite to the commencement of the
construction of the Improvements or to the operation and occupancy of
the Improvements or the Approved Project or to the performance of any
act or obligation or the observance of any agreement, provision or
condition of whatsoever nature herein contained.
(u) "Guarantor" means: Xxxxxx Xxxxxxx, Xxxxxx Xxxxxxx,
Xxxxxx Xxxxx and Transeastern Properties Inc., a Florida corporation,
f/k/a Transeastern Properties of South Florida, Inc., a Florida
corporation.
(v) "Guaranty" means the Guaranty Agreement executed by
Guarantor in favor of Bank, providing for Guarantor's payment of all
sums due under the Loan Documents and of performance of all obligations
of Borrower thereunder except as otherwise specifically therein
provided, including, without limitation, timely completion of the
Improvements in accordance with the Construction Documents and Loan
Documents.
(w) "Improvements" means all infrastructure improvements to
the Land and single family residences, structures, dwellings, and Units
constructed or to be constructed on the Land as defined in the
Mortgage, together with all fixtures and appurtenances now or later to
be located on the Land and/or in such Improvements.
3
(x) "Land" means the real property described in the Mortgage
at the inception of the Loan as per EXHIBIT "F" attached hereto and as
may be later included by modification and spreader agreement.
(y) "Loan Documents" means this Loan Agreement, the Note and
any funding agreement, the Mortgage, the Guaranty, the Financing
Statements, and any other document or writing executed in connection
therewith or in furtherance thereof.
(z) "Lot Release Price" shall mean the partial release
price as set forth in EXHIBIT "B" attached hereto and incorporated
herein.
(aa) "Model Unit" means a Unit constructed and furnished
initially for inspection by prospective purchasers.
(bb) "Mortgage" means the Real Estate Mortgage, Assignment
and Security Agreement of even date herewith executed by Borrower for
the benefit of Bank encumbering the Collateral (as defined in the
Mortgage), and any extensions, modifications, renewals or replacements
thereof.
(cc) "Note" means collectively the Promissory Note (for
Revolving Line of Credit) in the amount of THREE MILLION FOUR HUNDRED
THOUSAND AND NO/DOLLARS ($ 3,400,000.00) ("Construction Line") dated as
of the Closing Date executed by Borrower in favor of Bank, as well as
any promissory note, sub-note, or other notes issued by Borrower in
substitution, replacement, extension, future advance, amendment or
renewal of the Note or any such promissory note or notes.
(dd) "Permitted Encumbrances" means those liens,
encumbrances, easements and other matters defined in the Mortgage as
"Permitted Encumbrances".
(ee) "Plans" means plans and specifications for the
development of the Land and construction of the Improvements submitted
to and approved by Bank from time to time, and including such
amendments thereto as may from time to time be made by Borrower and
approved by Bank.
(ff) "Pre-Sold Unit" means a Unit owned by Borrower and
covered by a Firm Contract.
(gg) "Security Documents" means the Mortgage, the Financing
Statements, and any other instrument executed to establish and perfect
Bank's lien on the Collateral, and any extensions, modifications,
renewals, or replacements thereof.
(hh) "Site Development Contractor" means such party who will
serve as the subcontractor for the site development of the Land as
contemplated under the Loan.
(ii) "Site Development Contract" means the contract between
Borrower and Site Development Contractor for the site development of
the Land per the site development Plans and specifications.
(jj) "Site Plan" means collectively the site plans for the
Project as set forth on EXHIBIT "E" attached hereto.
(kk) "Spec Unit" means a Unit for which a Firm Contract has
not been received or approved, and which is not used as a Model Unit.
(ll) "Title Policy" means the mortgagee title policy meeting
the requirements of this Loan Agreement.
4
(mm) "Unit" means a portion of the Land and its respective
improvements constituting a single residential dwelling unit.
(nn) "Unit Release Price", shall mean the partial release
price for each Unit funded under the Construction Line as set forth on
EXHIBIT "B" attached hereto and incorporated herein.
(oo) "Use of Proceeds" means the description of the
permitted use of the Loan proceeds under the A&D Note as set forth on
EXHIBIT "A" attached hereto and incorporated by reference herein.
Capitalized terms not defined in this Loan Agreement shall have the
meanings ascribed to them in the Mortgage.
ARTICLE II
THE LOAN
2.1 LOAN TERMS. Subject to the terms and conditions of this Loan
Agreement, Bank will lend and Borrower will borrow up to a principal sum of
THREE MILLION FOUR HUNDRED THOUSAND AND NO/100 DOLLARS ($ 3,400,000.00), which
borrowing shall be evidenced by the Note. Also, all of the terms, definitions,
conditions, and covenants of the Note, the Guaranty, the Mortgage, and any other
documents executed in connection therewith or pursuant thereto are expressly
made a part of this Loan Agreement by reference in the same manner and with the
same effect as if set forth herein at length and shall have the meaning set
forth in such instruments unless otherwise defined herein.
2.2 A&D NOTE. The A&D Note is a Consolidated Renewal Promissory Note
in the original principal amount of EIGHT MILLION SEVEN HUNDRED THIRTY SEVEN
THOUSAND FIVE HUNDRED AND NO/100 DOLLARS ($8,737,500.00), which note is secured
by a first mortgage in favor of Bank, dated March 29, 1996, and recorded April
3, 1996 in Official Records Book 24694 at Page 0702, of the Public Records of
Broward County, Florida, as modified by that certain Amended and Restated Real
Estate Mortgage Assignment, and Security Agreement of even date herewith
executed by Borrower in favor Bank.
2.3 CONSTRUCTION LINE. The Construction Line is a revolving line of
credit and the principal amount outstanding under such note may increase and
decrease from time to time as Borrower draws and repays note funds thereunder
but the principal balance of such note outstanding from time to time shall not
exceed the original, principal amount of the Construction Line. Provided
Borrower is not in Default, outstanding amounts under such note may be repaid or
reborrowed from time to time subject to the terms, conditions and limitations
set forth in this Agreement, but the principal balance of such note outstanding
from time to time shall not exceed the original, principal amount of the
Construction Line.
2.4 LOAN PURPOSE. The purpose of the Loan is to finance construction
costs of Units to be constructed in that certain Approved Project known as
Pelican Pointe, located in Pembroke Pines, Florida ("Pelican Pointe") which
project shall be hereinafter referred to as the "Approved Project".
Disbursements of Loan proceeds for construction of Units in other developments
owned or hereinafter acquired by Borrower or Units not meeting the following
limitations shall be at Bank's sole discretion, and Bank shall under no
circumstances be obligated to disburse Loan proceeds except as expressly set
forth in this Loan Agreement.
2.5 LIMITATIONS ON USE OF A&D NOTE PROCEEDS. INTENTIONALLY OMITTED.
2.6 LIMITATIONS ON USE OF CONSTRUCTION LINE PROCEEDS. Bank will
disburse Construction Line proceeds for the construction of Units subject to the
terms and conditions of this Loan Agreement, the Use of Proceeds attached as
Exhibit "A", and the following limitations:
5
(a) Construction Line proceeds shall be used solely to
fund construction of Units (i) for which Bank has approved the Plans
and (ii) having a maximum sales price of ONE HUNDRED FIFTEEN THOUSAND
AND NO/100 DOLLARS ($115,000.00) or for which the total construction
costs as set forth in the Unit Cost Breakdown, excluding lot cost as
approved by Bank, do not exceed SIXTY FIVE THOUSAND AND NO/100 DOLLARS
($65,000.00).
(b) Construction Line proceeds shall be used solely for the
direct and indirect costs to construct Units as set forth in the Unit
Cost Breakdown and approved by Bank. Borrower states for the express
benefit and reliance of Bank that it has not relied and is not relying
on any binding obligation on the part of Bank to finance the
construction of a particular number of Units unless Borrower has
performed the prerequisites for such construction as set forth in the
Loan Documents.
(c) The amount to be funded on each Pre-Sold Unit will be
determined by deducting the Lot allocation of SIXTEEN THOUSAND ONE
HUNDRED SEVENTEEN AND NO/100 DOLLARS ($16,117.00) from eighty percent
(80%) of the lesser of: (i) the "completed value" of such Unit, which
amount shall be determined by an appraisal satisfactory to Bank (which
appraisal shall be at Borrower's sole expense); or (ii) the purchase
price for the Unit reflected in the Firm Contract; provided, however,
that in no event shall Bank be obligated to fund Construction Line
proceeds in an amount in excess of one hundred percent (100%) of the
Unit Cost Breakdown submitted by Borrower and approved by Bank.
(d) The amount to be funded on each Spec Unit and Model Unit
will be determined by deducting the Lot allocation of SIXTEEN THOUSAND
ONE HUNDRED SEVENTEEN AND NO/100 DOLLARS ($16,117.00) from seventy five
percent (75%) of the "completed value,' of said Spec Unit or Model
Unit, which amount shall be determined by an appraisal satisfactory to
Bank (which appraisal shall be at Borrower'S sole expense) ; provided,
however, that in no event shall Bank be obligated to disburse
Construction Line proceeds in excess of one hundred percent (100%) of
the Unit Cost Breakdown for such Spec Unit or Model Unit submitted by
Borrower and approved by Bank.
(e) Use of Construction Line proceeds for the construction
of Units shall be limited to sixteen (16) Spec Units and four (4) Model
Units, forty (40) Pre-Sold Units. Notwithstanding any provision in this
Agreement to the contrary, at any time no more than five (5) Spec Units
shall be permitted for any one home model type.
(f) Intentionally omitted.
(g) Each Pre-Sold Unit financed under the Construction Line
shall be completed, as defined in this Agreement, in a period not to
exceed nine (9) months from the date construction commences.
(h) The amount financed under the Construction Line must be
repaid in full (i) for any Spec Unit within (12) months from the date
construction commences on such Spec Unit and (ii) for any Model Unit
within thirty five (35) months from the date of this Agreement.
(i) only residential Units within the Approved Project shall
be financed by the Construction Line.
(j) At such time as the number of Spec Units financed
under the Construction Line has become sixteen (16) Spec Units,
additional Spec Units financed under the Construction Line may only be
commenced upon (a) repayment of all Loan advances for one of the
sixteen (16) Spec Units; or (b) at such earlier time as one of the Spec
Units becomes a Pre-Sold Unit. All Pre-Sold Units upon which the Sales
Contract has been canceled due to the default of the buyer and which
are available for sale, shall become designated as a Spec Unit. If, at
any time, the number of Spec Units exceeds sixteen (16) in number, the
6
Borrower shall not be permitted to request funding for construction of
any further Spec Units until the number of such funded Spec Units is
reduced to no more than sixteen (16) Spec Units.
(k) At such time as the number of Model Units financed
under the Construction Line has become four (4) Model Units, additional
Model Units financed under the Construction Line may only be commenced
upon (a) repayment of all Loan advances for one of the four (4) Model
Units; or (b) at such earlier time as one of the Model Units becomes a
Pre-Sold Unit. If, at any time, the number of Model Units exceeds four
(4) in number, the Borrower shall not be permitted to request funding
for construction of any further Model Units until the number of such
funded Model Units is reduced to no more than four (4) Model Units.
(l) The total amount to be funded for the costs of
construction of a Unit, as approved and allocated by Bank pursuant to
Subparagraphs 2.5(a) through (e), inclusive, less the allocable loan
amount per lot, above shall be called the "Committed Unit Amount." Upon
Bank's approval of the commencement of construction of a Unit and the
Bank's approval of the Committed Unit Amount for said Unit, the
Committed Unit Amount shall be reserved under the Construction Line,
and shall not be available for disbursement for construction of any
other Units until such time as the Unit Release Prices repaid create
amounts available under the Construction Line. After making the initial
disbursement under the Committed Unit Amount, the remaining unfunded
Committed Unit Amount shall be disbursed on a percentage basis in
accordance with the terms of this Agreement. Bank shall not in any case
be obligated to approve or fund the construction of a new Unit unless
there are sufficient "available" Construction Line proceeds as noted
below to complete construction of that Unit. For purposes of this
Agreement, the term "available" Construction Line proceeds shall mean
the amount derived by subtracting the total Committed Unit Amounts from
the Maximum Committed Funding Amount of THREE MILLION FOUR HUNDRED
THOUSAND AND NO/100 DOLLARS ($3,400,000.00) as described below in
subparagraph (m).
(m) Notwithstanding any provision in this Agreement to the
contrary, the number of Units (Model, Spec and Pre-Sold) financed under
the Construction Line shall be limited by a "Maximum Committed Funding
Amount" of THREE MILLION FOUR HUNDRED THOUSAND AND NO/100 DOLLARS
($3,400.000.00) representing the total of all Committed Unit Amounts
for all Units under the Construction Line for which construction has
commenced and initial funding by Bank has been made. Regardless of the
Maximum Committed Funding Amount "availability" under the Construction
Line, consisting of up to THREE MILLION FOUR HUNDRED THOUSAND AND
NO/100 DOLLARS ($3,400,000.00) of "Committed Unit Amounts", the amount
outstanding at any one time under the Construction Line shall be no
greater than THREE MILLION FOUR HUNDRED THOUSAND AND NO/100 DOLLARS
($3,400,000.00).
2.7 LOAN MATURITY. The maturity date of the Construction Line shall be
September 1, 1999 with two (2) extension options of three (3) months each to be
granted at Borrower's request, at the sole and absolute discretion of Bank and
on the terms as set forth in the Construction Line Note. On the Maturity Date of
the Note, all sums outstanding under such notes shall be immediately due and
payable, and the Bank's obligation to fund shall cease and terminate.
ARTICLE III
DISBURSEMENTS
3.1 A&D NOTE DISBURSEMENT - GENERAL PROVISIONS. INTENTIONALLY
OMITTED.
3.2 CONSTRUCTION LINE DISBURSEMENT - GENERAL PROVISIONS. Bank agrees
that it will, from time to time, and so long as there shall exist no Default
Condition or Default (which has not been cured within any
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applicable grace period), but not more frequently than two (2) times per month,
disburse Construction Line proceeds for the construction of Units in the
Approved Project, subject to the terms and conditions of this Agreement.
3.3 REQUEST FOR INITIAL FUNDING COMMENCEMENT OF CONSTRUCTION OF A UNIT
UNDER THE CONSTRUCTION LINE. When Borrower wishes to commence funding for
construction of a particular Unit, Borrower shall submit a draw request,
accompanied by all items required in Articles IV and V as conditions precedent,
to the extent applicable. All supporting documentation shall be submitted no
later than five (5) days prior to the requested date of the initial disbursement
under each note. No disbursement by Bank shall constitute an approval or
acceptance by Bank of any construction work or constitute a waiver by Bank of
any conditions precedent to any future disbursements. Bank shall not be
obligated to approve any disbursement for purposes other than those contemplated
in this Agreement. The conditions set forth in Articles IV and V hereof must be
satisfied before Bank will make the first advance or disbursement for the
development of Land or construction of a Unit, and the conditions set forth in
Article VI hereof must be and remain satisfied before Bank will make each
subsequent disbursement or advance.
3.4 INTERIM DRAW REQUESTS. No later than five (5) days prior to
disbursement by Bank, Borrower must submit to Bank a Draw Request, which shall
include or be accompanied by the requirements set out herein for draws.
3.5 DISBURSEMENT AMOUNTS. Following receipt of a Draw Request and
Bank's review and approval of supporting documentation, Bank shall determine the
amount of the disbursement it will make in accordance with the Percentage
Completion Draw Schedule, a copy of which is attached as EXHIBIT "D" provided no
Default Condition or Default exists.
3.6 EQUITY DISBURSEMENTS. Except as provided in Section 2.6(m), if
Bank at any time determines in its reasonable discretion that the Loan proceeds
plus the amount of all equity investments made or scheduled to be made are not
sufficient to fully complete the Improvements in accordance with the Plans and
to pay all other sums due under the Loan Documents, then Bank shall have the
option of requiring Borrower to deposit with Bank additional funds from some
other source (or submit evidence to Bank of equity investments previously made)
in amounts sufficient to cover the resulting deficit before Bank will disburse
any additional Loan proceeds. Deposited funds shall be advanced as construction
progresses in accordance with this Loan Agreement before any additional Loan
disbursements are made.
3.7 OPTION TO DISBURSE FUNDS TO ANY GUARANTOR AND/OR TO PAY
CONTRACTORS. If a Default shall exist, at its option, Bank may, after so
notifying Borrower, make Loan disbursements directly to any guarantor or obligor
of the debt when such party shall be performing the obligations of Borrower
hereunder or the General Contractor or any unpaid subcontractor, laborer or
material supplier providing labor, services or materials in connection with the
construction of the Improvements, and the execution of this Loan Agreement by
Borrower shall, and hereby does, constitute an irrevocable direction and
authorization to Bank to so disburse the funds. No further direction or
authorization from Borrower shall be necessary to warrant such direct
disbursements and all such disbursements shall be secured by the Security
Documents as fully as if made to Borrower, regardless of the disposition thereof
by the General Contractor, any subcontractor, laborer or material supplier so
paid.
ARTICLE IV
GENERAL PRE-CLOSING CONDITIONS
Bank's obligations to close the Loan shall be expressly conditioned
upon satisfaction of the following conditions, or execution and/or delivery to
Bank of the following items, all in form and substance reasonably satisfactory
to Bank and Bank's counsel:
4.1 NOTE. The original Note, properly executed, shall have been
delivered to Bank.
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4.2 GUARANTY. The original Guaranty(s), properly executed, shall have
been delivered to Bank.
4.3 MORTGAGE. The Mortgage, which shall be a second lien on the Land
and Improvements, shall have been properly executed in recordable form and
delivered to Bank, subject to those matters reflected in the Title Policy.
4.4 INDEMNITY. The Hazardous Substance Certificate and Indemnification
Agreement, properly executed by Borrower and each Guarantor, shall have been
delivered to Bank.
4.5 FINANCING STATEMENTS. The Financing Statements on forms approved f
or filing in the appropriate state and local filing offices shall have been
properly executed.
4.6 TITLE POLICY. A standard ALTA mortgagee title policy insuring the
lien of the Mortgage as a first priority lien encumbering the Land and
Improvements from a company or from companies approved by Bank (including any
reinsurance agreements required by Bank, together with direct access provisions
in favor of Bank): (1) providing coverage for the full principal amount of the
Loan, (2) providing a variable rate endorsement, if appropriate, the Form 9
Endorsement, the Revolving Loan Endorsement, the Survey Endorsement, and any
other endorsements requested by Bank, (3) deleting all "standard" exceptions
except taxes for the current year, (4) insuring all appurtenant easements, (5)
containing no bankruptcy or creditors' rights exceptions or exclusions; and (6)
containing no title exceptions other than the Permitted Exceptions or the other
exceptions approved by Bank.
4.7 TITLE EXCEPTIONS. Copies of all documents creating exceptions to
the Title Policy.
4.8 SURVEY/RECORDED AND PRELIMINARY PLAT/APPROVED SITE PLAN. Three (3)
copies of a recent survey of the Land prepared by a registered land surveyor
acceptable to Bank and certified to Bank, the title insurance company, and
Borrower. Such survey shall contain a certification as to the applicable flood
zone (s) for the Land, and a certification that the survey was and in accordance
with the Minimum Technical Standards for Surveys as set fourth in Chapter
21HH-6, Florida Administrative Code. In addition, a copy of the boundary plat
for the Land and a copy of the site plan is required approved by all applicable
governmental authorities. Notwithstanding the foregoing, the Bank will not
unreasonably withhold its consent to the execution of the final plat and will
join when requested by Borrower. A recorded copy of the plat shall be delivered
to Bank prior to any Construction Line funding requests for Units with Firm
Contracts.
4.9 FLOOD HAZARDS. Evidence as to whether or not the Land is located
within an area identified as having "special flood hazards" as such term is used
in the Federal Flood Disaster Protection Act of 1973.
4.10 FLOOD HAZARD INSURANCE. If all or any part of the Improvements is
or is to be located in an area having "special flood hazards", a flood insurance
application or policy naming the Bank as mortgagee must be submitted to Bank at
such time as it is commercially available. Satisfactory evidence of premium
payments must also be provided.
4.11 BUILDER'S RISK INSURANCE. A builder's risk insurance policy
meeting the requirements set forth in the Mortgage.
4.12 LIABILITY INSURANCE. Liability insurance meeting the requirements
set forth in the Mortgage.
4.13 BORROWER'S ORGANIZATIONAL DOCUMENTS AND RESOLUTIONS. A certified
copy, from the appropriate governmental body or corporate officer, of
organizational documents of Borrower, and any partner of Borrower, as
appropriate, certifying that Borrower and/or such partner (i) is duly organized,
validly existing, and in good standing under the state of its existence, (ii)
has the authority under such documents and laws to enter into the Loan as
contemplated by the Loan Documents, and (iii) has made all appropriate filings,
including without limitation,
9
qualification to do business in the State of Florida, necessary to enter into
the Loan and execute the Loan Documents. Additionally, Borrower shall provide
(i) if appropriate, certified resolutions or other internal documents or writing
of Borrower and such partner evidencing that Borrower and such partner have
taken all requisite organizational action, and received all organizational
approvals necessary to enter into the Loan and execute the Loan Documents, and
(ii) such other documents or writings as Bank may request.
4.14 GUARANTOR'S ORGANIZATIONAL DOCUMENTS AND RESOLUTIONS.
INTENTIONALLY OMITTED.
4.15 FICTITIOUS NAME CERTIFICATE. If Borrower utilizes or intends to
utilize a fictitious name, a copy of the Fictitious Name Certificate of the
Borrower issued by the Florida Secretary of State.
4.16 ATTORNEY'S OPINION. The written opinions of counsel to Borrower
and Guarantor, addressed to Bank, acceptable to Bank and Bank's counsel, as to
those matters required by Bank. The attorney's opinion, with respect to the
enforceability of remedies provided in any instrument may be made subject to or
affected by, applicable bankruptcy, moratorium, reorganization, insolvency or
similar laws from time to time in effect affecting the rights of creditors
generally. As to matters of fact, such opinions may be qualified to the extent
of the knowledge of such counsel based upon inquiry and reasonable
investigation.
4.17 RESTRICTIVE COVENANTS. A copy of the executed and recorded
homeowners, documents, filed articles of incorporation for the homeowners,
associations, executed by-laws for the associations, and any other related
documents as Bank may request for the Approved Project. Notwithstanding the
foregoing, such documents shall be delivered to Bank prior to any Construction
Line funding for Units with Firm Contracts and Bank agrees to not unreasonably
withhold or delay its consent to such documents.
4.18 FINANCIAL STATEMENTS. The updated Borrower prepared financial
statements certified to the Bank must be received by Bank within thirty (30)
days of the Closing Date. With respect to the Guarantors, signed personal
financial statements on Bank forms shall be required prior to the Closing Date.
All statements must include income and contingent liability information.
4.19 COMPLIANCE WITH LAWS AND MATTERS OF RECORD. Satisfactory
documentary evidence that the Land, and the intended uses of the Land are in
compliance with all applicable laws, regulations and ordinances and private
covenants, easements, and conditions of record. Such evidence is subject to
approval by Bank and Bank's counsel and may include letters, licenses, permits,
certificates and other correspondence from the appropriate Governmental
Authorities, opinions of Borrower's counsel or other counsel, and opinions or
certifications from the Architect, Engineer and the General Contractor. The
laws, regulations and ordinances with which compliance should be evidenced
include without limitation the following: health and environmental protection
laws, laws related to or regulating water management districts, hazardous
materials and substances and stormwater drainage, erosion control ordinances,
tree and landscaping ordinances, building codes, land use requirements,
threshold building consultant requirements, the Development of Regional Impact
Statutes, doing business and/or licensing laws and zoning laws (the evidence
submitted as to zoning should include the zoning designation made for the Land,
the permitted uses of the Land under such zoning designation and zoning
requirements as to parking, lot size, ingress, egress and building setbacks).
4.20 TAXES. Evidence that the Land is, or will be, separately assessed
for tax purposes and information as to tax parcel identification numbers, tax
rates, estimated tax values and the identities of the taxing authorities. Also,
Borrower shall submit proof that the taxes are paid current upon the Land.
4.21 UTILITIES. Evidence of the availability and suitability of the
water, sewer, telephone, electrical, and other utilities needed to properly
service the Project in its intended use.
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4.22 PLANS AND SPECIFICATIONS. Two sets of the site development Plans
which must have been approved in writing by Borrower and the General Contractor
either by initialing same or by other written approval identifying all pages and
dates, including revision dates. The Plans must include all site development
(including storm drainage, utility lines, erosion control and landscaping) plans
and specifications and must incorporate the recommendations in the soil testing
report. Bank will engage its engineer to review such Plans to determine
sufficiency of such under its guidelines.
4.23 PERMITS. Borrower will provide a copy, certified by the Borrower
to be a true and correct copy of the South Florida Water Management District
Permit, if applicable.
4.24 SOIL TESTS. A report as to soil borings made on the Land by a soil
testing firm satisfactory to Bank. The number and location of such borings shall
be in accordance with the recommendations of the soil testing firm and must also
be satisfactory to Bank. The report shall include the recommendations of the
soil testing firm as to the preparation of the soil needed in order to
adequately support the Improvements, and shall be delivered and approved by Bank
within sixty (60) days of the date of this Agreement.
4.25 ENVIRONMENTAL ASSESSMENT.
(a) An environmental assessment of the Land and Improvements
performed at Borrower's expense by a licensed engineer or other
environmental consultant satisfactory to Bank stating that:
i. the Land is not located within any area designated as a
hazardous substance site by any of the Governmental Authorities;
and
ii. no hazardous or toxic wastes or other materials or
substances regulated, controlled, or prohibited by any federal,
state, or local environmental laws, including but not limited to
asbestos, are located on the Land or Improvements; and
iii. the Land has not been cited or investigated in the past
for any violation of any such laws, regulations, or ordinances.
(b) If the environmental assessment shall reveal any condition
unacceptable to Bank, same shall constitute a Default hereunder and in
addition to all remedies available to Bank, Bank shall be relieved of
any obligation under the Commitment. If the environmental assessment
recommends, or if Bank so requests, in its sole and absolute
discretion, a Phase II audit, additional testing or remedial action,
Borrower, at its sole cost and expense shall promptly conduct such
additional audits and testing and/or complete such remedial action.
Bank may require the Borrower to provide evidence that all necessary
actions have been taken to remove any hazardous substance contamination
and/or to restore the site to a condition acceptable to Bank and state
and federal governmental agencies.
4.26 TAXPAYER IDENTIFICATION NUMBER. Borrower's federal taxpayer
identification number.
4.27 BORROWER'S AFFIDAVIT. An affidavit of Borrower regarding the
absence of any other parties in possession of the Land, stating that a notice of
commencement has not been filed with respect to the Property, the
non-commencement of construction of Improvements , and such other matters as may
be requested by Bank.
4.28 COMMITMENT FEE. The balance of the non-refundable commitment
fee in the total amount of THIRTY FOUR THOUSAND AND NO/100 DOLLARS ($34,000.00)
which was earned upon acceptance of the Commitment and the reserving of
sufficient funds by Bank from which to make Loan disbursements, and is due and
payable whether or not any disbursements are made hereunder.
11
4.29 APPRAISAL. Bank shall have received a narrative appraisal
certified to the Bank for the Land and site development improvements prepared by
an appraiser acceptable to Bank.
4.30 COMPREHENSIVE PLAN. Documentary evidence, satisfactory to Bank and
its counsel, that Borrower's development proposal for the Project and the
construction of the Improvements are consistent with concurrency requirements
and other applicable provisions of the local comprehensive plan and local land
development regulations, as defined and required by the Local Government
Comprehensive Planning and Land Development Regulation Act, Florida Statutes.
Section 163.3161, et seq.
4.31 FACILITIES FOR HANDICAPPED. Subsequent to the Closing Date but not
later than the commencement of the construction of the sales center or the
clubhouse, as applicable, Bank shall have received and approved evidence,
satisfactory to Bank, that the Plans and specifications do, and the
Improvements, when constructed, will comply to the extent applicable with all
legal requirements regarding access and facilities for handicapped or disabled
persons, including, without limitation, and to the extent applicable, Part V of
the Florida Building Construction Standards Act entitled "Accessibility by
Handicapped Persons", Chapter 553, Fla Stat.; the Federal Architectural Barriers
Act of 1988 (42 U.S.C. ss.4151, et. seq.), The Fair Housing Amendment Act of
1988 (42 U.S.C. ss.3601, et. seq), The Americans With Disabilities Act Of 1990
(42 U.S.C. ss.12101 et. seq.), and The Rehabilitation Act of 1973 (29 U.S.C.
ss.794).
4.32 CONTRACTS. A copy of the executed contract for the purchase of th
Land by the Borrower, if applicable.
4.33 SUBORDINATION AGREEMENTS. Borrower will provide a fully executed
original Loan Subordination Agreement, which document shall be recorded in the
Public Records of Broward County, evidencing the subordination of Amresco
Funding Corporation, a Delaware corporation's interest, as evidenced by that
certain Mortgage, Assignment of Rents, and Security Agreement, dated March 29,
1996, and recorded April 3, 1996 in Official Records Book 24694 at Page 0744, of
the Public Records of Broward County, Florida (the "Amresco Third Mortgage") and
that certain Contingent Mortgage, Assignment of Rents and Security Agreement,
dated March 29, 1996 and recorded April 3, 1996, in Official Records Book 24694
at Page 0787, of the Public Records of Broward County, Florida, (the "Amresco
Fourth Mortgage") the Bank's Mortgage.
4.34 MISCELLANEOUS. All other Loan Documents or items that are
customarily provided in loan transactions of this type and all other loan
documents or items set forth in the Commitment.
ARTICLE V
CONDITIONS PRECEDENT TO FIRST SITE DEVELOPMENT AND
CONSTRUCTION DISBURSEMENTS
5.1 A&D NOTE DISBURSEMENTS. INTENTIONALLY OMITTED.
5.2 CONSTRUCTION LINE DISBURSEMENTS. Under the Construction Line, Bank
shall not be obligated to make the first Loan disbursement for construction of a
particular Unit until all of the following conditions have been satisfied by
proper evidence, execution and/or delivery to Bank of the following items, all
in form and substance reasonably satisfactory to Bank and Bank's counsel:
(a) There shall be no Loan Default or Default Condition, which
has not been cured with any applicable grace period.
(b) The Land shall be free and clear of all liens and
encumbrances except for Bank's Mortgages in favor of Bank and the
Permitted Exceptions, the Amresco Third Mortgage and the Amresco Fourth
Mortgage.
12
(c) All conditions precedent as set forth in Article IV shall
have been satisfied.
(d) Bank shall have received an appraisal for such Unit, in form
and substance satisfactory to Bank, indicating its "completed value".
(e) If the Unit is a Pre-Sold Unit, the requirements necessary
for establishing a Firm Contract shall have been met.
(f) Bank shall have received satisfactory evidence that the Unit
is covered by Borrower's builder's risk insurance policy; if the Unit
is located in a flood hazard zone, Bank shall have received
satisfactory evidence that the Unit is covered by Borrower's flood
insurance policy or that application for flood insurance has been made.
(g) Bank shall have received a true and correct copy of the Cost
Breakdown and Plans for that Unit type.
(h) Bank shall have received a copy of the Notice of Commencement
recorded for that Unit under the Florida Construction Lien Act, which
Notice of Commencement must have been recorded after the recording of
Bank's Mortgage.
(i) Bank shall have received and approved Borrower's Draw
Request.
(j) Bank is satisfied that all roads necessary for ingress and
egress to the Unit and the Approved Project have been completed or will
be completed and that all utility services necessary for the
construction of the Improvements are available at the boundaries of the
Land and will be available to the boundary of the lot upon which the
Unit will be constructed.
(k) Borrower shall have paid to Bank a fee in the amount of
ONE HUNDRED FIFTY AND NO/100 DOLLARS ($150.00) per Unit for property
inspections in connection with up to a maximum of ten (10) draw
requests (such fee may be paid from the initial construction funding on
each Unit). Thereafter, Borrower shall pay Bank FIFTY AND NO/100
DOLLARS ($50.00), for each inspection per Unit in connection with a
draw request (such fee shall be a charge against the per Unit
construction funding for such Unit).
(l) Bank shall have received a copy of the building permit and
all permits pursuant thereto for the Unit to be constructed.
(m) The third party purchaser's interest in the Mortgaged
Property and under the Firm Contract shall be expressly subordinated to
the lien and operation of Bank's Mortgage.
(n) Two sets of the Plans (including standard Unit floor plans)
which must have been approved in writing by Borrower and the General
Contractor either by initialing same or by other written approval
identifying all pages and dates, including revision dates. The Plans
must include architectural, structural, mechanical, plumbing and
electrical plans and specifications and must incorporate the
recommendations in the soil testing report.
(o) APPRAISAL. Borrower shall have furnished Bank with
narrative appraisals certified to the Bank for each base Unit model
type on a standard non-premium lot prepared by an appraiser acceptable
to Bank.
13
(p) COST BREAKDOWN. A detailed cost breakdown for the
construction of each base Unit model type. At Borrower's expense, Bank
will engage its engineer to review such costs to determine sufficiency
of same under the Bank's guidelines.
(q) CONTRACTS. The proposed contract for sale and purchase of a
completed Unit, and other documents to be used by Borrower to market
and convey Units in the Approved Project.
(r) ARCHITECT'S CONTRACT. Copies of the contracts signed by
Borrower and Architect for design and supervisory services.
(s) CONTRACTOR'S CONTRACT. Copies of the contracts signed by the
Borrower and Contractor for construction services related to the Units.
(t) CONSENT OF THE ARCHITECT. Consents from the Architect to
Borrower's assignments to Bank of Borrower's interests in the contract
with such party. In addition, the design architect, if any, shall agree
that Bank may use and copy the Plan if a Default occurs. In furtherance
of the assignment granted herein, Borrower shall cause all contract
parties to acknowledge this assignment to Bank and agree to continue
such contract on the same terms as presently exist if Bank shall
succeed to the interest of Borrower thereunder and if so requested by
Bank.
ARTICLE VI
CONDITIONS PRECEDENT TO DISBURSEMENTS
FOLLOWING THE FIRST DISBURSEMENT
6.1 GENERAL PERIODIC DISBURSEMENTS UNDER THE A&D NOTE AND
CONSTRUCTION LINE. Bank shall not be obligated to make any Loan disbursements
after the first disbursement provided for in Article V under the A&D Note or the
Construction Line until all of the following conditions have been and remain
satisfied as of the date of each such disbursement:
(a) All of the conditions stated in Article III hereof,
including, without limitation submission of a Draw Request.
(b) A request for payment signed by Borrower setting forth a
detailed breakdown of the disbursement requested in a format acceptable
to Bank.
(c) Construction of the Improvements for which such Draw Request
has been made has been performed in accordance with the Plans, the
Construction Schedule, and all terms and conditions hereunder.
(d) The Title Policy insurer shall have issued to the Bank an
ALTA Construction Endorsement Form to the Title Policy updating the
Policy and listing any additional subordinate matters or certifying
that no lien or other interest shall have attached to the Project other
than the interest of Bank pursuant to the lien of the Security
Documents, whether superior or subordinate to such lien, except taxes
for the current year and other matters acceptable to Bank, and there
are no liens which may take priority over the disbursement to be made
and there are no survey exceptions not theretofore approved by Bank in
writing.
(e) At the time of each disbursement: (i) Bank is reasonably
satisfied with the progress of construction; (ii) in Bank's reasonable
opinion, the equity requirements set out in Section 2.5 and 3.6 are
satisfied; and (iii) no Default Condition or Default exists under the
Loan Documents.
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(f) Bank shall have received Bank's Construction Inspector's
approval to the Borrower's requisition for any hard costs.
(g) Bank shall have received copies of all notarized partial
release lien waiver forms executed by each appropriate subcontractor,
supplier and/or materialman which have filed a Notice to Owner.
(h) An Owner's Affidavit from Borrower certifying that the funds
disbursed to date by Bank have been paid to the appropriate parties.
(i) No litigation, arbitration or other proceeding shall have
been commenced against Borrower or the General Contractor, which in
Bank's judgment, materially impairs, or is likely to materially impair
the Borrower's or the General Contractor's ability to complete the
Project.
(j) As and when reasonably requested by Bank, a recertification
of the Survey reflecting all changes in the physical conditions of the
Land and Improvements subsequent to the date of the last certification
of the Survey. Each such recertification shall show all construction
work in place.
(k) Bank, based on the advice of its Construction Inspector, must
believe in its reasonable opinion that construction can be completed
within the time frame set forth in Paragraph 2.6(g) herein as to the
Units under the Construction Line.
(l) There shall not have been any destruction or casualty to the
Improvements not covered by insurance.
(m) If the Draw Request requires an amendment to the Use of
Proceeds or the Percentage Completion Draw Schedule or reallocation of
hard cost items which would require contractor and lienor notice under
ss.713.347(2), Fla. Stat., written notice from owner to the Contractor
and all required lienors, in compliance with ss.713.347,(2) Fla. Stat.,
and countersigned by the Contractor and any lienors who have provided
notices to owner.
(n) RETAINAGE. Bank has the right to withhold the final six
percent (6.0%) of the individual unit's construction loan until such
time as the Certificate of Occupancy or Final Certificate of Inspection
by the appropriate governmental authority is issued.
6.2 CONSTRUCTION LINE PERIODIC DISBURSEMENTS. The following
additional conditions shall have been and remain satisfied as of the date of
each Construction Line disbursement for a Unit:
(a) At request of Bank, if the slab has been poured on a lot, a
satisfactory foundation or tie-in survey for such lot shall have been
submitted to Bank consistent with the requirements herein prior to any
draws subsequent to the initial draw.
(b) At request of Bank, soil report as to the compaction and
other soil test on the Land by a soil testing firm satisfactory to
Bank, at such times and in such locations as recommended by such firm.
Borrower shall promptly submit to Bank copies of all such reports,
together with any other physical tests made on the Land, the
Improvements, or the materials to be incorporated into the Improvement
and shall, at its sole cost and expense, cause such additional test to
be made from time to time, as Bank may reasonably require.
(c) At such time as any portion of the Improvements are occupied,
Borrower shall submit to Bank an "all risk" permanent hazard insurance
policy with respect to such Improvements, complying with the
requirements set forth in the Mortgage, and including a Replacement
Cost and Agreed
15
Amount/Stipulated Value Endorsement and such other endorsements as are
deemed necessary by Bank, together with evidence that all insurance
premiums have been paid.
(d) After the slab has been poured, no additional advances toward
construction shall be made until after the effective date of the flood
hazard application/policy.
6.3 REQUIREMENTS FOR DISBURSEMENT AT COMPLETION. Bank shall not be
obligated to make the final construction disbursement for a Unit until all of
the following additional conditions have been satisfied:
(a) The Units which have been commenced have been substantially
completed and are substantially in accordance with the Plans, and
certificates as to such Completion have been issued in satisfactory
form to Bank by the Architect/Engineer and the General Contractor,
including, without limitation, Architect's Certificate of Completion
together with AIA G704 Certificate of Substantial Completion,
Contractor's Certificate of Completion together with the AIA G704
Certificate of Substantial Completion and, if applicable, the
Engineer's Certificate of Completion, and certificates as to occupancy
and use have been issued by the appropriate Governmental Authorities
(and copies provided to Bank).
(b) Bank has received three (3) copies of an "as-built" survey
prepared by a registered surveyor consistent with Section 4.8 above and
additionally showing all of the Improvements in place.
(c) Bank has received two sets of detailed as-built plans and
specifications approved and identified as such in writing by Borrower,
the Architect/Engineer and the General Contractor. The two sets must
include plans and specifications for (i) as to the Construction Line,
architectural, structural, mechanical, plumbing and electrical details;
and (ii) as to the A&D Note, all site development (including without
limitation, storm drainage, easements, utility lines and landscaping)
work, as applicable.
(d) Bank has received final lien waivers and releases from the
General Contractor and all general contractors, subcontractors,
subcontractors, suppliers, laborers, and materialmen certifying that
they and all parties in privity with them have been paid in full and
waiving their lien rights against the Project (or such lot, as
appropriate).
(e) Bank has received an inspection report performed by this
Construction Inspector in substance satisfactory to Bank and
Construction Inspector's written approval of the final Draw Request.
ARTICLE VII
THE BORROWER'S CONVENTS AND AGREEMENTS
7.1 PAYMENT AND PERFORMANCE. Borrower will pay when due or within any
applicable grace period all sums owing to Bank under the Note, this Loan
Agreement, the Mortgage and the other Loan Documents, and perform all
obligations as outlined or referenced therein.
7.2 FURTHER ASSURANCES. On demand by Bank, Borrower will do any act
and execute any additional documents reasonably required by Bank to secure the
Loan, to confirm or perfect the lien of the Security Documents, including, but
not limited to, additional financing statements or continuation statements, new
or replacement notes and/or Security Documents and agreements supplementing,
extending or otherwise modifying the Loan Documents, certificates as to the
amounts of the indebtedness evidenced by the Note from time to time, and
certificates that Borrower knows of no defaults by or defenses or set-offs
against Bank as long as such certificate represents the true statement of
Borrower.
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7.3 CONSTRUCTION. The Borrower will: (a) continue conscientiously the
construction of the Improvements; (b) not discontinue or permit the
discontinuance of work on the Improvements for longer than fifteen (15)
consecutive days, (c) in any event, complete the Improvements, including
installation of any required items of personalty in substantial compliance with
the Plans, free and clear of liens or claims of liens for material supplied or
for labor or services performed in connection with the construction of the
Improvements; and (d) not file, prior to the recording of the Mortgage, a Notice
of Commencement for the Approved Project. Notwithstanding the foregoing, any
delays in the event of unavailability of materials at reasonable cost, strikes,
other labor problems, governmental order, acts of God or other events which
would support a defense based upon impossibility of performance for reasons
beyond the control of Borrower shall not be a breach of Borrower's
responsibilities under this Section VII.
7.4 PAYMENT OF CONTRACTORS. Borrower covenants to advise Bank
immediately, and in writing if Borrower receives any claim of lien in connection
with any services, labor or materials furnished in connection with the
construction of Units, and to remove such liens within thirty (30) days of the
date of filing. Borrower shall comply with the Construction Contract Prompt
Payment Law contained in the Florida Construction Lien Law, Chapter 713, Fla.
Stat. Notwithstanding the foregoing, Borrower shall not be in Default under this
paragraph if the number and amount of such liens are under the amounts set forth
in Section 9.1(g).
7.5 FEES AND EXPENSES. Whether or not the Loan is made or all Loan
proceeds disbursed hereunder, Borrower agrees to pay all expenses incurred by
Bank, or by Borrower in order to meet Bank's requirements, in connection with
the Loan, including without limitation, commitment and renewal fees or deposits
to Bank, fees for appraisal, environmental assessment, reappraisal, survey,
recording, title insurance, builder's risk and other insurance premiums,
brokerage commissions and claims of brokerage, property taxes, intangible taxes,
documentary stamp taxes, architect's fees, engineer's fees, inspection fees, the
General Contractor's fees, and such legal fees and costs incurred by Bank in
connection with the making and administration of the Loan, the enforcement, of
Bank's rights under the Loan Documents, arbitration, the renewal, modification,
or extension of the Loan, or in connection with litigation or threatened
litigation by a third party which arises because Bank made the Loan. Any such
amounts paid by Bank shall constitute part of the indebtedness which is secured
by the Security Documents, and shall be due and payable upon demand.
7.6 INSURANCE. Borrower covenants to maintain insurance, as required
herein and in the Mortgage.
7.7 TAXES AND INSURANCE. Upon the request of Bank, Borrower shall
submit to Bank such receipts and other statements which shall evidence, to the
satisfaction of Bank, that all taxes (by April 30th of each year), assessments
and insurance premiums have been paid in full.
7.8 TITLE POLICY. When requested by Bank during the Loan term,
Borrower shall provide an endorsement to the Title Policy certifying that (a)
real estate taxes due through such date have been paid; (b) no additional
restrictions or encumbrances are of record which have not been approved by Bank;
and (c) no liens or lis pendens have been filed against the Land or the
Improvements. In the event that periodic title endorsements are not required to
be issued in connection with the title insurance, Borrower agrees to cause title
endorsements to be issued as reasonably required by Bank. When requested, after
the final disbursement of Loan proceeds, Borrower will provide Bank with an
endorsement to the Title Policy insuring the principal balance of the Loan and
containing no exceptions not approved by Bank.
7.9 ADDITIONAL CONSTRUCTION. Borrower shall not construct or permit
the construction of any improvements other than options prepaid by end
purchasers on the Approved Project other than those Improvements described in
the Plans, or approved in writing by Bank.
7.10 SALES REPORTS. Within ten (10) days after the end of each month
Borrower shall deliver to Bank a Sales Report covering that month such Sales
Report shall include, among other things as may be required by Bank,
17
a cumulative summary of the number of Units sold, closed and under construction
as well as the number of Spec and Model Units in each Transeastern Properties,
Inc., a Florida corporation project.
7.11 INSPECTION. Borrower will permit Bank and its authorized agents to
enter upon the Project during normal working hours and as often as Bank desires,
for the purpose of inspecting the construction of the Improvements. When
requested, Borrower will furnish to Bank detailed plans, shop drawings and
specifications which relate to the Improvements. Failure of Bank or its
authorized agents to discover deficiencies in or to reject materials or
workmanship incorporated or provided to the Improvements shall not make Bank or
its agent liable to Borrower or to any other person on account of such failure,
nor shall any prior failure constitute a waiver of Bank's right to subsequently
reject any such workmanship or materials. Borrower specifically acknowledges
that all inspections undertaken by Bank or its agent shall be for the sole
benefit of Bank and not for Borrower, any Guarantor, or any third party.
7.12 FOUNDATION AND OTHER SURVEYS. Under the Construction Line, upon
the completion of the construction of the foundation of each unit, Borrower will
promptly submit to Bank for its approval one (1) copy of a foundation survey of
the Project prepared by a registered land surveyor and consistent with the
requirements of Section 4.8 above. In addition to the surveys specifically
required by this Agreement, Borrower shall provide Bank during construction with
such additional surveys as requested by Bank.
7.13 SOIL AND OTHER TESTS. A report as to the compaction or other soil
tests made on the Land by a soil testing firm shall also be submitted to Bank
when so requested in accordance with the requirements of paragraph 4.24 above.
The number and locations of such soil tests shall be in accordance with the
recommendations of the soil testing firm. Borrower shall promptly submit to Bank
copies of reports of all other physical tests made on the Land, the Improvements
or the materials to be incorporated into the Improvements and shall, at
Borrower's expense, cause to be made such additional tests from time to time as
Bank may reasonably require.
7.14 USE OF LOAN FUNDS. Borrower shall use all Loan proceeds disbursed
to Borrower solely in payment of costs incurred in connection with constructing
the Project, in accordance with the Cost Breakdown and Use of Proceeds.
7.15 AVAILABILITY OF UTILITIES. All utility services necessary for the
construction of the Improvements and the operation thereof for their intended
purposes are presently available or will be available when needed through
presently existing public or unencumbered private easements or rights-of-ways in
accordance with validly executed and enforceable utility service agreements
between Borrower and the provider of each of such services (the "Utility Service
Agreements"), if applicable (which would inure to the benefit of Bank in the
event of the foreclosure of the Mortgage) at the boundaries of the Land,
including but not limited to, water, storm and sanitary sewer, gas, electric and
telephone facilities, and all such utilities are non-interruptible. Borrower
shall also provide Bank with copies of all Utility Service Agreements.
7.16 HAZARDOUS SUBSTANCES. Borrower affirms and incorporates by
reference the representations, warranties, terms, conditions, and indemnities
contained in that certain Hazardous Substance Certificate and Indemnification
Agreement of even date herewith.
At any time deemed necessary by Bank, in its sole and absolute
discretion, Bank may, at its election, obtain one or more environmental
assessments of the Land prepared by a geohydrologist, an independent engineer,
or other qualified consultant or expert approved by Bank evaluating or
confirming (i) whether any Hazardous Substances as defined in other Loan
Documents are present in the soil or water at the Land and (ii) whether the use
and operation of the Land complies with all applicable Environmental Laws
relating to air quality, environmental control, release of oil, hazardous
materials, hazardous wastes and hazardous substances, and any and all other
applicable environmental laws. Environmental assessments may include detailed
visual inspections of the Land including, without limitation, any and all
storage areas, storage tanks, drains, dry xxxxx, and leaching areas,
18
as well as such other investigations or analyses as are necessary. or
appropriate for a complete determination of the compliance of the Land and the
use and operation thereof with all applicable Environmental Laws. Such
environmental assessments shall be at the sole cost and expense of Borrower. In
the event that it is determined that additional tests and/or remediation are
necessary as a result of the aforesaid assessments, or in the event such
additional testing or remediation is recommended by the aforesaid assessments,
the Borrower agrees to immediately perform the tests or undertake the
remediation as recommended. In the event contamination or other environmental
problem is found on the Property, the Borrower shall be in Default hereunder
after a thirty (30) day cure period.
7.17 CAPITAL ADEQUACY. INTENTIONALLY OMITTED.
7.18 INDEMNIFICATIONS. The Borrower and the Guarantor shall indemnify
and hold Bank and its directors, officers, agents, employees, and attorneys
harmless from all liability, loss, expense or damage of any kind or nature,
including, without limitation, any suits, proceedings, claims, demands, or
damages (including attorneys' fees and costs paid or incurred in connection
therewith at both trial and appellate levels), incurred or arising by reason of:
(a) The Commitment or the making of the Loan (except for
liability, loss, expense or damage arising from the willful misconduct
or gross negligence of Bank);
(b) Any claim or action for the payment of any brokerage
commissions or fees which may be claimed to be payable in connection
with the Commitment; and
(c) The past, present or future handling, storage,
transportation, or disposal of hazardous substances upon the Land.
Notwithstanding the foregoing, Borrower's and Guarantor's indemnity
shall be limited to the extent provided in the Hazardous Substance
Certificate and Indemnification Agreement executed by such parties as
of the Closing Date.
These indemnifications shall survive the full payment and performance
of the obligations of the Borrower under the Loan documents except as set forth
above and in the Hazardous Substance Certificate and Indemnification Agreement.
7.19 FINANCIAL STATEMENTS. Borrower and each Guarantor shall submit
annual and interim financial statements as set forth below and when so requested
by Bank. Such statements shall include, at a minimum: a balance sheet; an income
and expense statement; a statement showing contingent liabilities; and any
supporting schedules or documentation which Bank may require. Each unaudited
statement must contain a certification to Bank of the statement's accuracy and
completeness signed by an authorized officer or the individual, as applicable.
Annual statements of business entities (including corporations and partnerships)
shall be audited by a certified public accountant reasonably acceptable to Bank
and shall be submitted no later than one hundred twenty (120) days after fiscal
year end. Interim statements shall be submitted within forty five (45) days of
each quarter end certified to Bank by the financial officer of Borrower.
Guarantor's personal financial statement shall be submitted to Bank prepared on
Bank's approval form within one hundred twenty (120) days of each calendar year
end. Borrower and Guarantor shall provide Bank with annual tax returns within
thirty (30) days of filing.
7.20 APPRAISALS. Bank must order, at Borrower's expense, and receive a
narrative discounted appraisal on the Land by an appraiser acceptable to Bank
and Bank must review said appraisal prior to Closing Date. At any time during
the term of the Loan, the Loan balance, including the unfunded but committed
portion, may not be in excess of seventy five percent (75%) of the Loan-to-value
with "value" being defined as, on a discounted basis, "as if" fully developed
with respect to Land for which development funding has commenced or is available
to commence and raw Land for which development has not commenced or is not
available to commence, all contemplated site development and Unit improvements.
In addition to the appraisal required by Bank prior to closing of the Loan,
19
updated appraisals shall be prepared at Borrower's expense when requested by
Bank but in no event more tan annually, if Bank believes, in its sole
discretion, that the value of the collateral for the Loan would render the
Loan-to-value to less than seventy five percent (75%) as defined above. Borrower
shall cooperate fully with the appraisal process and shall allow the appraisers
reasonable access to the Approved Project.
7.21 LEASES AFFECTING APPROVED PROJECT. Borrower shall not, without the
express prior written consent of Bank, enter into any lease affecting the
Approved Project or any part thereof.
7.22 ASSIGNMENT OF CONTRACTS. As additional security for the Loan and
for the performance by Borrower of all of its obligations hereunder, Borrower
hereby assigns to Bank all of Borrower's interest in any and all contracts,
agreements, permits, licenses, approvals, or other documents or writings
relating to the construction, leasing, management or operation of the
Improvements, including but not limited to the Construction Documents, the
architect's contract, the engineer's contract, site development contractor's and
the Plans. This assignment shall not, however, be deemed to impose upon Bank any
of Borrower's obligations under any such contract. Incident to the assignment of
the Construction Documents, the architect's contract, site development
contractor's contract, the engineer's contract, and the Plans, Borrower will
fulfill the obligations of Borrower thereunder, enforce the performance thereof
and give immediate notice to Bank of any default by the architect, site
development contractor, the engineer, or the General Contractor thereunder.
Further, Borrower will not, without the prior written consent of Bank (i)
materially modify, or amend the terms of the architect's contract, the Plans,
engineer's contract, site development contractor's contract or the Construction
Documents; or (ii) waive or release the performance of any material obligation
to be performed by the architect, the engineer, site development contractor or
the General Contractor thereunder.
7.23 SUBORDINATE FINANCING. Borrower shall not permit there to exist
nor shall Borrower obtain any subordinate or secondary financing of the Land or
any other property granted as security for the Loan, except for that certain
loan in favor of Amresco Funding Corporation, a Delaware corporation, which loan
is secured by that certain mortgage dated March 29, 1996 and recorded in
Official Records Book 24694 at Page 0744 of the Public Records of Broward
County, Florida and that certain contingent return mortgage dated March 29, 1996
and received in Official Records Book 24694 at Page 0787 of the Public Records
of Broward County, Florida, both of which have been voluntarily subordinated to
Bank's mortgages.
7.24 TRANSFER OF PROPERTY OF BORROWER. The Borrower shall not permit
any change in its ownership (or the ownership of its general partners, if
applicable), its corporate or trade name, the nature and operation of its
business or the nature and character of the Borrower or the Approved Project,
nor shall the Borrower sell, assign, transfer, hypothecate or dispose of all or
any portion of the Land, Improvements, or the Approved Project, except as may be
permitted hereby, without the prior written consent of Bank, which consent shall
be withheld or granted in Bank's sole and absolute discretion.
7.25 PARTIAL RELEASES OF PROPERTY. Provided the Borrower is not then in
Default hereunder, under the Note, the Mortgage or any other Loan Document, Bank
will provide partial releases in respect of its interest under the Mortgage and
other Loan Documents upon the terms and conditions set out in Exhibit "B"
attached. Payments made for releases shall be applied by Bank against the
outstanding principal of the Loan unless the release payment is calculated to
take into account allocable interest or other constituent costs or accruals, in
which event Bank may apply the release payment in accordance with such
calculations. Borrower agrees to reimburse Bank for all out-of-pocket fees and
costs, as set forth in Exhibit "B" hereto in connection with the granting of
such partial releases and shall provide Bank with any and all information
requested by Bank with respect to the Unit to be released.
Notwithstanding anything contained herein to the contrary, if
Borrower applies for the partial release of a lot from the lien of the Mortgage
and other Loan Documents and there is not then any outstanding principal balance
under the A&D Note, but there are outstanding letters of credit (either drawn or
undrawn upon) issued by Bank on Borrower's behalf which are secured by the
Mortgage (the "Secured Letters of Credit"), the Lot
20
Release Price (computed in a redefined manner as follows: that certain amount
derived by dividing the sum of all remaining outstanding letters of credit by
the number of remaining developed lots encumbered by the Mortgage) shall
nevertheless be due and payable as a precondition to Bank's obligation to grant
a partial release or permit the commencement of a Unit on a particular lot, as
applicable, and the Lot Release Prices paid for partial releases in this
situation (collectively, the "Partial Release Funds") shall be placed by Bank in
an account in Borrower's name, which account shall be pledged by Borrower to
Bank as additional collateral for the Loan and the indebtedness of Borrower to
Bank arising out of the Secured Letters of Credit. Borrower shall have no rights
to make withdrawals or otherwise receive disbursements from the pledged account.
Borrower agrees to execute any and all documents required by Bank to evidence
the pledge of the Partial Release Funds. If the Secured Letters of Credit are
drawn, or if Borrower Defaults under the Loan Documents, Bank may, in its sole
and absolute discretion, and in addition to any and all of its available rights
and remedies under the Loan Documents, the documents evidencing the Secured
Letters of Credit, or otherwise, apply the Partial Release Funds to reimburse
Bank for any drawings made under the Secured Letters of Credit and to any then
outstanding balance under the Loan. If said Secured Letters of Credit are
reduced or released, the pledged account will be reduced or released as well and
shall be returned to Borrower.
Notwithstanding any provision herein to the contrary, if Bank at
its sole discretion has agreed to issue letters of credit for the performance of
site development work contemplated in this Agreement, sufficient availability
for funding such scope of work must exist under the Use of Proceeds for which
the letter of credit is being requested.
7.26 DISCLOSURE OF CONTRACTS AND NOTE. Borrower shall disclose to Bank
upon demand, the names of all persons with whom Borrower has contracted or
intends to contract for any construction or for the furnishing of labor or
materials therefor, and when required by Bank obtain the approval by Bank of all
such persons. Borrower shall upon Bank's request, at all times during the
construction period of any Improvements, provide to the Bank, within ten (10)
days of the Borrower's receipt thereof, copies of all notices to owner, claims
of lien, and demands for sworn statement of account, issued by any party,
whether pursuant to any notice of commencement or otherwise, in connection with
the Approved Project or the Land.
7.27 CONSTRUCTION LIEN LAW NOTIFICATION REQUIREMENTS. Borrower hereby
authorizes Bank to provide written notices to Contractor and lienors providing
notices to owner pursuant to ss.713.3471 (1)(a), Fla. Stat., and ss.713.3471
(2)(b), Fla. Stat., to the extent such notices are required by law. Borrower
hereby releases Bank and waives all claims it may have against Bank for damages
Borrower may incur as a result of Bank's failure to deliver said notices.
Borrower hereby agrees to provide all required notices to the Contractor and all
lienors providing notices to owner in compliance with ss.713.3471(2)(a), Fla.
Stat., in a timely fashion.
7.28 AMENDMENTS TO COST BREAKDOWN. If Borrower amends the Cost
Breakdown or reallocate items in the Cost Breakdown such that written notice to
the Contractor and lienors serving notices to owner would be required under
ss.713.3471(2)(a), Fla. Stat., (1992), Borrower agrees to provide written notice
to the Contractor and all required lienors in compliance with ss.713.3471
(2)(a), Fla. Stat., Bank shall not be obligated to make any disbursements of
Loan proceeds until Borrower has provided Bank with copies of any required
notices to the Contractor and required lienors in compliance with ss.713.3471
(2)(a), Fla. Stat., together with evidence that such notices have been
countersigned by the Contractor and all lienors who are required to receive the
notice under ss.713.3471 (2)(a), Fla. Stat., thereby confirming receipt thereof.
7.29 AMENDMENT TO THE USE OF PROCEEDS. With the written authorization
of Borrower or Borrower's authorized representative only, as evidenced by
Borrower's Draw Request, Bank may amend the Use of Proceeds or reallocate funds
designated for specific line items to other line items. Such amendment may be
evidenced by Borrower's Draw Request or by an Amended Use of Proceeds Schedule
and may be made without the consent of the Guarantors. Bank shall not be
permitted to reallocate items in the Use of Proceeds without the Borrower's or
Borrower's authorized representatives prior written consent.
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7.30 LOAN FEES. INTENTIONALLY OMITTED.
7.31 MINIMUM A&D NOTE REPAYMENT SCHEDULE. INTENTIONALLY OMITTED
7.32 AMERICANS WITH DISABILITIES ACT. Borrower covenants and agrees
that, during the term of the Loan, to the extent such Act is applicable, the
Improvements and Approved Project will be in full compliance with the Americans
with Disabilities Act ("ADA") of July 26, 1990, 42 U.S.C Section 12191, et.
seq.) as amended from time to time, and the regulations promulgated pursuant
thereto. Borrower shall be solely responsible for all ADA compliance costs,
including without limitation, attorneys' fees and litigation costs, solely
relating to such period in which Borrower is the owner of the Land which
responsibility shall survive the repayment of the Loan and foreclosure of the
Land and Improvements.
7.33 REGULATION "Z". The Loan is exempt from the provisions of the
Federal Consumers Credit Protection Act (Truth-in-Lending Act) and Regulation
"Z" of the Board of Governors of the Federal Reserve System, because Borrower is
a person fully excluded therefrom, and/or because the Loan is only for business
or commercial purposes of Borrower and the proceeds of the Loan are not being
used for personal, household, family or agricultural purposes.
7.34 FINANCIAL COVENANTS. Borrower shall at all times be prohibited
from incurring or providing a guaranty for any additional debt, except trade
accounts payable in the ordinary course of business relative to the Approved
Project, or form pledging its assets to secure or guarantee any debt other than
that of the Borrower.
7.35 SUBORDINATION OF SHAREHOLDER LOANS. Borrower hereby subordinates,
to the prior payment to Bank of all sums owing under the Loan, any and all
loans, advances, and indebtedness owing from Borrower to shareholders of
Borrower from time to time, whether or not evidenced by promissory notes.
Borrower may make payments of principal and interest for any loan owing to its
shareholders until the Loan is paid in full so long as no Default exists under
the Loan.
ARTICLE VIII
REPRESENTATIONS AND WARRANTIES
8.1 REPRESENTATIONS AND WARRANTIES. Borrower hereby represents and
warrants to Bank that:
(a) REPRESENTATIONS AND WARRANTIES IN MORTGAGE AND GUARANTY. All
of the representations and warranties contained in the Mortgage and
Guaranty are true and correct and are incorporated herein by reference
as if set out in full.
(b) OTHER FINANCING. The Borrower has not (i) received any other
financing for the acquisition of or development and construction on the
Land existing as of the date hereof for which a lien equal to or
superior to Bank's mortgage could be successfully asserted, or (ii)
received any other financing for the construction of the Improvements,
except for financing in favor of Amresco Funding Corporation, a
Delaware corporation's interest, as evidenced by that certain Mortgage,
Assignment of Rents, and Security Agreement, dated March 29, 1996, and
recorded April 3, 1996 in Official Records Book 24694 at Page 0744, of
the Public Records of Broward County, Florida (the "Amresco Third
Mortgage") and that certain Contingent Mortgage, Assignment of Rents
and Security Agreement, dated March 29, 1996 and recorded April 3,
1996, in Official Records Book 24694 at Page 0787, of the Public
Records of Broward County, Florida, (the "Amresco Fourth Mortgage") the
Bank's Mortgage.
(c) PLANS. The Plans have been or will be prior to use approved
by the Borrower, the Guarantor, and each appropriate Governmental
Authority.
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(d) GOVERNMENTAL REQUIREMENTS AND OTHER REQUIREMENTS. Borrower
will cause the Land to be developed and the Units to be xxxxxxxxxxx.xx
accordance with the Plans submitted to and approved by Bank, and when
so constructed the Land and the Units do and shall comply with all
covenants, conditions and restrictions affecting the Land or any
portion thereof, and do and shall comply with all Governmental
Requirements.
(e) USE OF THE APPROVED PROJECT. There is no (i) plan, study or
effort by any Governmental Authority or any nongovernmental person or
agency which may adversely affect the current or planned use of the
Approved Project, or (ii) to the best of Borrower's knowledge any
intended or proposed Governmental Requirement (including, but not
limited to, zoning changes) which may adversely affect the current or
planned use of the Approved Project.
(f) MORATORIUM. There is no moratorium or like governmental order
or restriction now in effect with respect to the Approved Project and,
to the best of Borrower's knowledge, no moratorium or similar ordinance
or restriction is now contemplated.
(g) PERMITS. All permits, approvals and consents of Governmental
Authorities and public and private utilities having jurisdiction
necessary in connection with the Approved Project have been or will be
issued and are or will be in good standing.
(h) CONDITION OF APPROVED PROJECT. No defect or condition of the
Land or the solid or geology thereof exists which will impair the
construction, use, or the operation of the Approved Project for its
intended purpose.
(i) LABOR AND MATERIALS. All labor and materials contracted for
in connection with the construction of the Improvements shall be used
and employed solely on the Land in said construction and only in
accordance with the Plans.
(j) SURVEYS. The Survey, the preliminary plat for the Land, and
all plot plans and other documents heretofore furnished by the Borrower
to Bank with respect to the Land and Improvements are accurate and
complete as of their respective dates. There are no encroachments onto
the Land and no improvements on the Land encroach onto any adjoining
property.
(k) CONSTRUCTION COSTS. The amount of the hard costs and soft
costs are accurate, true and correct and are satisfactory to Borrower.
(l) SALE OF SECURITIES. The Borrower has not instituted, caused
to be instituted or been a party to and, to the best of Borrower's
knowledge, there has not been any public offering with respect to the
Land and Improvements, or either, within the meaning of the Securities
Act of 1933 and the Securities Exchange Act of 1934.
(m) CONSTRUCTION LIEN LAW. At the time of Closing and at the time
of the recording of the Mortgage, no work has been done on Improvements
or on the Approved Project by the Borrower or anyone else acting for,
or on behalf of the Borrower, and no materials have been placed on the
Property by any materialmen or by anyone else. No Notice of
Commencement has been recorded in the Public Records with respect to
the Approved Project or the Land at the time of Closing. Borrower shall
not permit the commencement of any excavation or construction work of
any nature whatsoever, nor the delivery of any materials to the
Approved Project or the Land, prior to the recordation and posting of a
Notice of Commencement as hereinafter set forth. Borrower shall execute
an appropriate Notice of Commencement and cause the same to be recorded
in the public records of the county in which the Property is located in
sequence after the recording of the Mortgage. Borrower shall post a
certified copy
23
of the Notice of Commencement on the Approved Project, in strict
conformity with the Florida Construction Lien Law. If construction is
commenced prior to the recordation and posting of the Notice of
Commencement, or the Notice of Commencement is recorded prior to the
Mortgage, Bank shall have the absolute right to cancel this Agreement
and be immediately reimbursed by Borrower for all disbursements of loan
proceeds, together with expenses and reasonable attorneys' fees
incurred in, connection therewith. Construction shall commence within
ninety (90) days after recordation of the Notice of Commencement.
Construction shall proceed continuously in a workmanlike manner. Bank
reserves the right to require Borrower to furnish an itemized cost
breakdown for the Improvements to be constructed.
(n) REPRESENTATIONS AND WARRANTIES IN OTHER LOAN DOCUMENTS. All
of the representations and warranties contained in the other Loan
Documents are true and correct.
8.2 RELIANCE ON REPRESENTATIONS. The Borrower acknowledges that Bank
has relied upon the Borrower's representations and is not charged with any
knowledge contrary thereto that may be received by an examination of the public
records wherein the Land is located or that may have been received by any
officer, director, agent, employee or shareholder of Bank.
8.3 CERTIFICATE REGARDING LOAN STATUS. Upon Bank's request, Borrower
and Guarantors shall provide Bank with a written certification, certifying to
such matters related to the Loan as Bank may request, including, but not limited
to, a statement that Borrower and Guarantors are not in Default and that no
Default Conditions have occurred.
ARTICLE IX
EVENTS OF DEFAULT
9.1 DEFAULT. The occurrence of any one. or more of the following
events (time being of the essence as to this Loan Agreement and all of its
provisions) constitutes a "Default" by Borrower under this Loan Agreement, and
at the option of Bank, under the other Loan Documents:
(a) SCHEDULED PAYMENT. Borrower's failure to make any payment
required under the Note when due or within any applicable grace period.
(b) MONETARY DEFAULT. Borrower's failure to make any other
payment required by this Loan Agreement or the other Loan Documents
when due or within any applicable grace period.
(c) OTHER. Borrower's failure to perform any other obligation
imposed upon Borrower by this Loan Agreement or any other Loan Document
within thirty (30) days after the date when performance is due. This
provision shall not be construed to provide Borrower with any grace
period in complying with any obligations imposed on Borrower by the
terms of the Loan Documents. Notwithstanding the foregoing provision,
Bank shall give Borrower notice, as defined in the Mortgage, of any
non-monetary default after which Borrower shall have a thirty (30) day
cure period.
(d) REPRESENTATION. Any representation or warranty of Borrower
contained in this Loan Agreement or in any certificate delivered
pursuant hereto, or in any other instrument or statement furnished in
connection herewith, proves to be incorrect or misleading in any
adverse respect as of the time when the same shall have been made,
including, without limitation, any and all financial statements,
operating statements, and schedules attached thereto, furnished by
Borrower or any guarantor of the Loan to Bank or pursuant to any
provision of this Loan Agreement,
24
(e) BANKRUPTCY. Borrower or any general partner of Borrower or
any guarantor of the Loan (i) files a voluntary petition in bankruptcy
or a petition or answer seeking or acquiescing in any reorganization or
for an arrangement,, composition, readjustment, liquidation,
dissolution, or similar relief for itself pursuant to the United State
Bankruptcy Code or any similar law or regulation, federal or state,
relating to any relief for debtors, now or hereafter in effect; or (ii)
makes an assignment for the benefit of creditors or admits in writing
its inability to pay or fails to pay its debts as they become due; or
(iii) suspends payment of its obligations or takes any action in
furtherance of the foregoing; or (iv) consents to or acquiesces in the
appointment of a receiver, trustee, custodian, conservator, liquidator
or other similar official of Borrower, a general partner of Borrower,
or any guarantor, for all or any part of the Collateral or other assets
of such party, or either; or (v) has filed against it an involuntary
petition, arrangement, composition, readjustment, liquidation,
dissolution, or an answer proposing an adjudication of it as a bankrupt
or insolvent, or is subject to reorganization pursuant to the United
States Bankruptcy Code, an action seeking to appoint a trustee,
receiver, custodian, or conservator or liquidator, or any. similar law,
federal or state, now or hereinafter in effect, and such action is
approved by any court of competent jurisdiction and the order approving
the same shall not be vacated or stayed within sixty (60) days from
entry; or (vi) consents to the filing of any such petition or answer,
or shall fail to deny the material allegations of the same in a timely
manner.
(f) JUDGMENTS. (1) A final judgment other than a final judgment
in connection with any condemnation is entered against Borrower,
Guarantors, or any general partner of Borrower, that (i) adversely
affects the value, use or operation of the Land or the Improvements in
Bank's sole judgment, or (ii) adversely affects, or may adversely
affect, the validity, enforceability or priority of the lien or
security interest created by the Mortgage or any other Loan Document in
Bank's sole judgment, or both; or (2) execution or other final process
issues thereon with respect to the Land or the Improvements; and (3)
Borrower, Guarantor, or any general partner of Borrower, does not
discharge the same or provide for its discharge in accordance with its
terms, or procure a stay of execution thereon, in any event within
thirty (30) days from entry, or Borrower shall not, within such period
or such longer period during which execution on such judgment shall
have been entered, and cause its execution to be stayed during such
appeal, or if on appeal such order, decree or process shall be affirmed
and Borrower shall not discharge such judgment or provide for its
discharge in accordance with its terms within sixty (60) days after the
entry of such order or decree or affirmance, or if any stay of
execution on appeal is released or otherwise discharged.
(g) LIENS. Any federal, state or local tax lien or any claim of
lien for labor or materials or any other lien or encumbrance of any
nature whatsoever is recorded against Borrower or the Land or
Improvements and is not removed by payment or transferred to substitute
security in the manner provided by law, within thirty (30) days after
it is recorded in accordance with applicable law.
(h) OTHER NOTES OR MORTGAGES. Borrower's default in the
performance or payment of Borrower's obligations under any other note
which remains uncured after any applicable grace period, or under any
other mortgage encumbering all or any part of the Land or the
Improvements, if the other mortgage is permitted by the Bank, whether
such other note or mortgage is held by Bank or by any other party, and
unless otherwise agreed to by separate written agreement between Bank
and such other mortgage holder.
(i) BORROWER DEFAULT UNDER LOAN DOCUMENTS. Borrower's default in
the payment or performance of any of Borrower obligations under any of
the Loan Documents, including this Loan Agreement and any riders
thereto.
(j) GUARANTOR DEFAULT.
25
i) The default after expiration of any applicable grace
period in the payment or performance of any obligation of a
Guarantor of the Note arising under its guaranty or pursuant to
any other Loan Documents; or
ii) The death of any Guarantor and the failure of Borrower
to provide Bank with an alternate guaranty or alternate collateral
satisfactory to Bank in its sole and absolute discretion within
sixty (60) days of the date of Guarantor's death.
(k) BORROWERS/GENERAL PARTNER'S CONTINUED EXISTENCE. Borrower or
any corporate General Partner of Borrower shall cease to exist or to be
qualified to do or transact business in the State in which the Land and
Improvements are located, or shall be dissolved or shall be a party to
a merger or consolidation, or shall sell all or substantially all of
its assets, or shall change its corporate name or trade name without
prior written notice to Bank.
(l) STOCK IN BORROWER/CHANGE IN PARTNERS. If Borrower is a
limited partnership and without the prior written consent of Bank, any
shares of stock of any corporate general partner of Borrower are
issued, sold, transferred, conveyed, assigned, mortgaged, pledged, or
otherwise disposed of so as to result in change of control of Borrower,
whether voluntarily or by operation of law, and whether with or without
consideration, or any agreement for any of the foregoing is entered
into; or, if any general partnership interest or other equity interest
in the Borrower is sold, transferred, assigned, conveyed, mortgaged,
pledged, or otherwise disposed of, whether voluntarily or by operation
of law, and whether with or without consideration, or any agreement for
any of the foregoing is entered into, or any general partner of
Borrower withdraws from the partnership.
(m) TRANSFER OF PROPERTY OR OWNERSHIP. Any sale, conveyance,
transfer, assignment, or other disposition or encumbrance of all or any
part of the Land, Improvements, or the Approved Project, or any
ownership interest in Borrower or any guarantor without the prior
consent of Bank or except as otherwise permitted hereby, or as outlined
in the prospectus for public offering for Transeastern Properties,
Inc., a Florida corporation delivered to Bank by Borrower.
(n) FALSE STATEMENT. Any statement or representation of
Borrower or any guarantor contained in the loan application or any
financial statements or other materials furnished to Bank or any other
Bank prior or subsequent to the making of the Loan secured hereby are
discovered to have been false or incorrect or incomplete.
(o) DEFAULT UNDER INDEMNITY. Borrower or Guarantor shall default
after any applicable grace period under any obligation imposed by any
indemnity contained within any of the Loan Documents including the
Hazardous Waste Certification and Indemnification.
(p) CROSS-DEFAULT. Any monetary default by the Borrower or
Guarantor under this Loan shall be a default under all other documents,
instruments, mortgages and other collateral documents evidencing and
securing all other loans by Bank to Borrower or Guarantor.
(q) NON-COMPLIANCE WITH THE PLANS AND SPECIFICATIONS. Failure of
any of the materials supplied for the development of the Land or the
construction of the Units to comply with the Plans and Specifications
or any requirements of any Governmental Authority unless the Borrower
undertakes and diligently pursues the correction of such failure.
(r) PROJECTED COMPLETION OF CONSTRUCTION. Failure to construct
the Improvements with reasonable dispatch, or the discontinuance of
construction at any time for a period of fifteen (15) days
consecutively, or determination by Bank that construction of the
Improvements will not be timely completed
26
and Borrower's failure to complete, cure or provide satisfactory
assurances after notice or demand from Bank. Notwithstanding the
foregoing, any delays in the event of unavailability of materials at
reasonable cost, strikes, other labor problems, governmental orders,
acts of God or other events which would support a defense based upon
impossibility of performance for reasons beyond the control of Borrower
shall not be a Default under this paragraph.
(s) NON-PAYMENT OF DEBTS. Borrower is generally not paying its
debts as such debts become due.
(t) SECURITIES LAWS VIOLATION. The assertion of any violation of
the 1933 Securities Act, 1934 Securities Act or the Florida Blue Sky
Laws by any Governmental Authorities or the institution of any
securities litigation not dismissed within sixty (60) days of the
commencement of same.
(u) NON-COMPLIANCE WITH HOMEOWNER ASSOCIATION DOCUMENTS. Borrower
shall fail to perform any duty required of it, fulfill any condition,
abide by any covenant or in any manner default under the homeowners,
association documents encumbering the Approved Project, if any.
(v) ADVERSE ACTIONS. Any legal or equitable action is commenced
against Borrower which, if adversely determined, could reasonably be
expected to impair substantially the ability of Borrower to perform
each and every obligation under the Loan Documents and this Agreement;
provided, however, if Borrower has commenced a counter action, contest
or defense to the adverse action and resolved such adverse action
within one hundred twenty (120) days of the commencement of same then
Borrower shall not be in Default.
(w) GOVERNMENT CHALLENGES. The validity of any permit, approval
or consent by any Governmental Authority relating to the Land, the
Improvements, or the Approved Project, or the operation thereof is
challenged by a proceeding before a board, commission, agency, court or
other authority having jurisdiction; provided, however, if Borrower has
commenced a counter action, contest or defense to the governmental
challenge and resolved such challenge within one hundred twenty (120)
days of the commencement of same then Borrower shall not be in Default.
(x) BORROWER'S ACTIONS. Any action by the Borrower, which would,
in the sole opinion of the Bank, significantly endanger the security of
the Loan and which Borrower fails to mitigate after notice from Bank
will render the Loan payable on demand.
(y) MISCELLANEOUS. If at any time the Bank shall determine that
there has been a material adverse change in the financial condition or
prospects of Borrower, the Guarantor, or any general partner of
Borrower, which is not corrected or cured after reasonable notice from
Bank.
ARTICLE X
BANK'S RIGHTS AND REMEDIES
The following rights and remedies are available to Bank:
10.1 ACCELERATION. Upon the occurrence of a Default, the entire unpaid
principal balance of the Loan and all accrued but unpaid interest thereon and
any costs or expenses then due to Bank and any and all other obligations of
Borrower to Bank, shall, at the option of Bank and without notice to Borrower,
become immediately due and payable.
10.2 COMPLETION OF CONSTRUCTION. From and after the occurrence of a
Default, Bank shall be entitled to have and use the Plans And the Construction
Documents and, after first having given written notice to the
27
architect, site development contractor, the engineer, or the General Contractor,
shall be entitled from and after such notice to enjoy and enforce all of the
rights of Borrower under the architect's contract, engineer's contract, site
development contractor's contract, the Plans or the Construction Contracts.
Borrower hereby irrevocably constitutes and appoints Bank its true and lawful
attorney-in-fact with full power of substitution in the Approved Project to
complete the Improvements in the name of Borrower following a Default. Borrower
hereby empowers Bank from and after Default as its attorney-in-fact as follows:
(a) to use any funds of Borrower, including any Loan proceeds or equity deposits
which may remain undisbursed hereunder, for the purpose of completing the
Improvements in accordance with the Plans; (b) to make such additions, changes,
modifications, or corrections in, or deviations from, the Plans as shall be
necessary or desirable to complete the Improvements; (c) to employ such
contractors, subcontractors, agents, architects, engineers, inspectors, or other
parties as shall be required for said purposes; (d) to pay, settle, or
compromise all existing bills and claims which may be liens against the
Improvements or as xxx.xx necessary or desirable in the sole discretion of Bank
for the completion of the Improvements or for clearance of title; (e) to direct
use of and/or use all or any part of the labor, materials, supplies and
equipment contracted for, owned by, or under the control of Borrower, whether or
not previously incorporated into the Improvements; (f) to execute all
applications and certificates in the name of Borrower which may be required by
the Construction Documents, the architect's contract, the engineer's contract,
site development contractor's contract, Plans, or any of the contract documents;
(g) to prosecute and defend all actions or proceedings in connection with the
Approved Project or the construction of the Improvements and take such action
and require such performance as Bank shall deem necessary under any performance
or payment bond; and (h) to do any and every act with respect to construction or
completion of the Improvements or the closing of any permanent financing which
Borrower might do in its own behalf including, without limitation, execution,
acknowledgment, and delivery of all instruments, documents, and papers in the
name of Borrower as may be necessary or desirable in the sole discretion of
Bank. It is further understood and agreed that this power of attorney which
shall be deemed to be a power coupled with an interest, cannot be revoked. All
sums expended by Bank pursuant hereto shall be deemed to have been disbursed to
Borrower and secured by the Security Documents, and the other Loan Documents.
10.3 DISPUTES. Where disputes have arisen which, in the opinion of
Bank, may endanger timely completion of the Improvements or fulfillment of any
condition or covenant herein, Bank may agree to disburse Loan proceeds for the
account of Borrower without prejudice to Borrower's rights, if any, to recover
said proceeds from the party to whom paid. Such agreement or agreements may take
the form which Bank in its discretion deems proper, including, but without
limiting the generality of the foregoing, agreements to indemnify (on behalf of
Borrower and/or for Bank's own account) any title insurer against possible
assertion of lien claims, agreements to pay disputed amounts and the like. All
sums paid or agreed to be paid pursuant to such undertaking shall be advances of
Loan proceeds.
10.4 REMEDIES CUMULATIVE: NONWAIVER: JUDGMENTS. All remedies of Bank
provided for herein or in the other Loan Documents are cumulative and shall be
in addition to any and all other rights and remedies provided for or available
under the other Loan Documents, at law or in equity. The exercise of any right
or remedy by Bank hereunder shall not in any way constitute a cure or waiver of
a Default Condition or a Default hereunder or under the Loan Documents, or
invalidate any act done pursuant to any notice of the occurrence of a Default
Condition or Default, or prejudice Bank in the exercise of any of its rights
hereunder or under any of the other Loan Documents, unless, in the exercise of
said rights, Bank realizes all amounts owed to it under the Loan Documents. ANY
JUDGMENT IN FAVOR OF BANK AGAINST BORROWER SHALL BEAR INTEREST AT THE DEFAULT
RATE (AS DEFINED IN THE NOTE).
10.5 NO LIABILITY OF BANK. Whether or not Bank elects to employ any or
all remedies available to it in the event of an occurrence of a Default
Condition or Default, Bank shall not be liable for the construction of or
failure to construct or complete or protect the Improvements or for payment of
any expense incurred in connection with the exercise or any remedy available to
Bank or for the construction or Completion of the Improvements or for the
performance or nonperformance of any other obligation of Borrower.
28
10.6 SECURITY INTEREST. It is understood and agreed that Bank shall
have and enjoy and is hereby granted a lien on, and a security interest in, all
collateral described in the Mortgage, and including without limitation, any and
all materials (stored on-site or off-site), reserves, deferred payments,
deposits or advance PAYments for materials (stored on-site or off-site)
undisbursed Loan proceeds, insurance refunds, impound accounts, refunds for
overpayment of any kind, and such lien and security interest shall constitute
additional security for the Indebtedness of Borrower to Bank, and Bank shall
have and possess any and all rights and remedies of a secured party provided by
law with respect to enforcement of and recovery on its security interest on such
items and amounts. In the event of a conflict between this paragraph and any
security interest granted pursuant to the Mortgage, the Mortgage shall control.
10.7 CESSATION OF FUNDING. Upon the occurrence of a Default, Bank shall
have the right to immediately terminate further funding of the Loan irrespective
of the stage of completion.
ARTICLE XI
GENERAL CONDITIONS
The following conditions shall be applicable throughout the term of
this Loan Agreement:
11.1 WAIVERS. No waiver of any Default Condition or Default or breach
by Borrower hereunder shall be implied from any delay or omission by Bank to
take action on account of such Default Condition or Default, and no express
waiver shall affect any Default Condition or Default other than the Default
specified in the waiver and it shall be operative only for the time and to the
extent therein stated. Waivers of any covenants, terms or conditions contained
herein must be in writing and shall not be construed as a waiver of any
subsequent breach of the same covenant, term or condition. The consent or
approval by Bank to or of any act by Borrower requiring further consent or
approval shall not be deemed to waive or render unnecessary the consent or
approval to or of any subsequent or similar act. No single or partial exercise
of any right or remedy of Bank hereunder shall preclude any further exercise
thereof or the exercise of any other or different right or remedy.
11.2 BENEFIT. This Loan Agreement is made and entered into for the sole
protection and benefit of Bank and Borrower, their successors and assigns, and
no other person or persons have any right to action hereon or rights to the Loan
all proceeds at any time, nor shall Bank owe any duty whatsoever to any claimant
for labor or services performed or material furnished in connection with the
Approved Project, or to apply any undisbursed portion of the Loan to the payment
of any such claim, or to exercise any right or power of Bank hereunder or
arising from any Default Condition or Default by Borrower.
11.3 ASSIGNMENT. The terms hereof shall be binding upon and inure to
the benefit of the heirs, successors, assigns, and personal representatives of
the parties hereto; provided, however, that Borrower shall not assign this Loan
Agreement or any of its rights, interests, duties or obligations hereunder or
any Loan proceeds or other moneys to be advanced hereunder in whole or in part
without the prior written consent of Bank and that any such assignment (whether
voluntary or by operation of law) without said consent shall be void. It is
expressly recognized and agreed that Bank may assign this Loan Agreement, the
Note, the Security Documents, and any other Loan Documents, in whole or in part,
to any other person, firm, or legal entity provided that all of the provisions
hereof shall continue in full force and effect and, in the event of such
assignment, Bank shall thereafter be relieved of all liability under the Loan
Documents and any Loan disbursements made by any assignee shall be deemed made
in pursuant and not in modification hereof and shall be evidenced by the Note
and secured by the Security Documents and any other Loan Documents.
29
11.4 AMENDMENTS. This Loan Agreement shall not be amended except by a
written instrument signed by all parties hereto.
11.5 TERMS. Whenever the context and construction so require, all words
used in the singular number herein shall be deemed to have been used in the
plural, and vice versa, and the masculine gender shall include the feminine and
neuter and the neuter shall include the masculine and feminine.
11.6 GOVERNING LAW AND JURISDICTION. This Loan Agreement and the other
Loan Documents and all matters relating thereto shall be governed by and
construed and interpreted in accordance with the laws of the State of Florida.
Borrower and all of its general partners hereby submits to the jurisdiction of
the state and federal courts located in Florida and agree that Bank may, at its
option, enforce its rights under the Loan Documents in such courts.
11.7 PUBLICITY. At Bank's request and expense, and subject to
applicable laws, regulations and restrictions, Borrower shall place upon the
Approved Project, at a location mutually acceptable :to Borrower and Bank, a
sign or signs advertising the fact that financing is being provided by Bank.
Bank shall also have the right to secure printed publicity through newspaper and
other media concerning the Approved Project and source of financing.
11.8 SAVINGS CLAUSE. Invalidation of any one or more of the provisions
of this Loan Agreement shall in no way affect any of the other provisions
hereof, which shall remain in full force and effect.
11.9 EXECUTION IN COUNTERPARTS. This Loan Agreement may be executed in
two or more counterparts, each of which shall be deemed to be an original, but
all of which shall constitute one and the same instrument, and in making proof
of this Loan Agreement, it shall not be necessary to produce or account for more
than one such counterpart.
11.10 CAPTIONS. The captions herein are inserted only as a matter of
convenience and for reference and in no way define, limit or describe the scope
of this Loan Agreement nor the intent of any provision hereof.
11.11 NOTICES. All notices required to be given hereunder shall be
given in accordance with the requirements of the Mortgage.
11.12 MANDATORY ARBITRATION. Any controversy or claim between or among
the parties hereto including but not limited to those arising out of or relating
to this Loan Agreement or any related agreements or instruments, including any
claim based on or arising from an alleged tort, shall be determined by binding
arbitration in accordance with the Federal Arbitration Act (or if not
applicable, the applicable state law) , the Rules of Practice and Procedure for
the Arbitration of Commercial Disputes of Judicial Arbitration and Mediation
Services, Inc. (J.A.M.S.), and the "Special Rules" set forth below. In the event
of any inconsistency, the Special Rules shall control. Judgment upon any
arbitration award may be entered in any court having jurisdiction. Any party to
this Loan Agreement may bring an action, including a summary or expedited
proceeding, to compel arbitration of any controversy or claim to which this Loan
Agreement applies in any court having jurisdiction over such action.
(a) SPECIAL RULES. The arbitration shall be conducted in the
County of Broward, Florida and administered by Endispute, Inc., d/b/a
J.A.M.S./Endispute who will appoint an arbitrator; if
J.A.M.S./Endispute is unable or legally precluded from administering
the arbitration, then the American Arbitration Association will serve.
All arbitration hearings will be commenced within 90 days of the demand
for arbitration; further, the arbitrator shall only, upon a showing of
cause, be permitted to extend the commencement of such hearing for up
to an additional 60 days.
30
(b) RESERVATION OF RIGHTS. Nothing in this Loan Agreement shall
be deemed to (i) limit the applicability of any otherwise applicable
statutes of limitation or repose and any waivers contained in this Loan
Agreement; or (ii) be a waiver by the Bank of the protection afforded
to it by 12 U.S.C. Sec. 91 or any substantially equivalent state law;
or (iii) limit the right of the Bank hereto (A) to exercise self help
remedies such as (but not limited to) setoff, or (B) to foreclose
against any real or personal property collateral, or (C) to obtain from
a court provisional or ancillary remedies such as (but not limited to)
injunctive relief or the appointment of a receiver. The Bank may
exercise such self help rights, foreclose upon such property, or obtain
such provisional or ancillary remedies before, during or after the
pendency of any arbitration proceeding brought pursuant to this
Agreement. At Bank's option, foreclosure under a deed of trust or
mortgage may be accomplished by any of the following: the exercise of a
power of sale under the deed of trust or mortgage, or by judicial sale
under the deed of trust or mortgage, or by judicial foreclosure.
Neither this exercise of self help remedies nor the institution or
maintenance of an action for foreclosure or provisional or ancillary
remedies shall constitute a waiver of the right of any party, including
the claimant in any such action, to arbitrate the merits of the
controversy or claim occasioning resort to such remedies.
11.13 DISBURSEMENT OF CONSTRUCTION LINE FUNDS AT RENEWAL. If, in Bank's
sole and absolute discretion, Bank agrees to extend the term of the Construction
Line, and the outstanding principal balance of the Construction Line IS LESS
than the original, principal Construction Line amount at the time of the
extension, then Bank may, in its sole and absolute discretion, but is not
obligated to, disburse sufficient Construction Line funds to increase the
outstanding principal balance of the Construction Line up the original,
principal amount of the Construction Line, provided that Borrower pledges to
Bank as additional security for the Construction Line liquid collateral in kind
and amount acceptable to Bank in its sole discretion and deposits the same in an
account with Bank. In connection with any such pledge of liquid collateral,
Borrower shall deliver to Bank any original securities or other instruments
evidencing the collateral and shall execute such security agreements,
assignments, powers-of-attorney, stock powers, endorsements, financing
statements or other documentation as Bank may require to establish and perfect
the security interest so granted by Borrower. Nothing contained herein shall
constitute Bank's agreement or commitment to renew the Construction Line.
IN WITNESS WHEREOF, Borrower and Bank have executed this Loan Agreement
as of the above written date.
Signed, sealed and delivered
in the presence of TRANSEASTERN PEMBROKE VILLAGES, INC., a
Florida corporation
_________________________
Witness #1 By __________________________________(SEAL)
_________________________ Xxxxxx Xxxxxxx, Executive Vice President
Print Name
_________________________ Address:
Witness #2
_________________________ 0000 Xxxxxxxxxx Xxxxx
Print Name Xxxxx Xxxxxxx, Xxxxxxx 00000
CHASE FEDERAL BANK, a Federal Savings Bank,
a Division of NATIONSBANK, N.A. (SOUTH), a
national banking association
31
_________________________
Witness #1 By __________________________________(SEAL)
_________________________ Xxxxx X. Xxxx, Real Estate Banking
Print Name Officer
_________________________
Witness #2 Address:
_________________________
Print Name 000 Xxxx Xxxxxxx Xxxxx Xxxx
Xxxxx 000
Xx. Xxxxxxxxxx, Xxxxxxx 00000
32
JOINDER OF GUARANTORS
The undersigned as Guarantor hereby joins in and consents to the
foregoing Loan Agreement.
_________________________
Witness #1
_________________________
Print Name
___________________________________________
_________________________ Xxxxxx Xxxxxxx
Witness #2
_________________________
Print Name
_________________________
Witness #1
_________________________
Print Name
___________________________________________
_________________________ Xxxxxx Xxxxxxx
Witness #2
_________________________
Print Name
_________________________
Witness #1
_________________________
Print Name
___________________________________________
_________________________ Xxxxxx Xxxxx
Witness #2
_________________________
Print Name
_________________________ Transeastern Properties, Inc., a Florida
Witness #1 of South,Inc., a Florida corporation
_________________________
Print Name
By __________________________________(SEAL)
_________________________ Xxxxxx Xxxxxxx, Executive Vice President
Witness #2
_________________________
Print Name
33
EXHIBITS
1. Exhibit "A": Draw Sheets/Use of Proceeds
2. Exhibit "B": Partial Release
3. Exhibit "C": Intentionally Omitted
4. Exhibit "D": Percentage Completion Draw Schedule
5. Exhibit "E": Site Plans
6. Exhibit "F": Legal Description
34
EXHIBIT "A" - DRAW SHEETS/USE OF PROCEEDS
NATIONSBANK, N.A. (SOUTH)
ACQUISITION AND DEVELOPMENT LOAN
REQUEST FOR FUNDING
PAGE 1 OF 2
BORROWER: ______________________________________________________________
SUBDIVISION: ______________________________________________________________
UNIT: ______________________________________________________________
TOTAL LOAN AMOUNT (COL. D): $ _____________________
TOTAL WORK IN PLACE (COL. E): $ _____________________
LESS RETAINAGE (COL. F): $ _____________________
TOTAL COMPLETED LESS RETAINAGE: $______________________
LESS PREVIOUS REQUESTS FOR FUNDING: $ _____________________
CURRENT FUNDING REQUEST (COL. H): $ _____________________
The above request is in accordance with terms of the Loan Agreement dated
__________________, and is certified that: 9a) The improvements on the above
listed property have been completed and are in place in accordance with the
plans & specifications, as submitted to and approved by Lender; (b) There are no
unpaid bills for labor, taxes and/or material for which liens may be filed upon
the date of this request; (c) All requirements of governmental agencies have
been fully complied with.
BORROWER:
PAGE 2 OF 2
OBTAIN A COPY FROM BANK
EXHIBIT B
PARTIAL RELEASES
1. PARTIAL RELEASES UNDER THE CONSTRUCTION LINE. Provided that
Borrower is not then in Default hereunder, under the Construction Line, the
Mortgage or any other Loan Document, Bank will provide partial releases of Units
from the lien of the Mortgage upon the following terms:
(a) If the partial release relates to developed lots in
connection with a bona fide sale or construction loan on which no home
construction advances have been made:
(i) Bank shall be given written notice of the request for
each partial release at least five (5) business days prior to each
partial release.
(ii) The cost of each partial release shall be paid by
Borrower.
(ii) Contemporaneously with the delivery to Borrower of each
partial release, Borrower shall prepay principal in an amount
equal to the amount advanced upon such lot plus accrued interest
thereon.
(b) If the partial release relates to Units for which advances of
Construction Line proceeds have been made, Borrower shall prepay
principal of the Construction Line in an amount equivalent to the total
actual amount advanced by Bank under the Construction Line on account
of the Unit to be released, together with interest accrued thereon
("Unit Release Price") and the applicable Lot Release Price.
EXHIBIT "C"
INTENTIONALLY OMITTED
ONE STORY DRAW SHEET
(OBTAIN FROM BANK)
TWO STORY DRAW SHEET
(OBTAIN FROM BANK)
EXHIBIT "E"
SITE PLANS
EXHIBIT "F"
LEGAL DESCRIPTION
CONSTRUCTION LOAN
AGREEMENT
BY AND BETWEEN
TRANSEASTERN PEMBROKE VILLAGES, INC.
A FLORIDA CORPORATION
(THE "BORROWER")
AND
CHASE FEDERAL BANK, A FEDERAL SAVINGS BANK, A DIVISION OF
NATIONSBANK, N.A. (SOUTH), A NATIONAL BANKING ASSOCIATION
ORGANIZED AND EXISTING UNDER THE LAWS OF THE UNITED STATES
(THE "BANK")
EGRET'S WAY
(THE "APPROVED PROJECT")
DATED: SEPTEMBER ____, 1996
XXXXXXX X. XXXX, ESQ.
XXXXXXX XXXXXXX & XXXXX XXXXX
0000 XXXXXXX XXXX
XXXXX 000
XXXXX XXXXX, XXXXXXX 00000
(000) 000-0000
Loan No. 91004539
THIS LOAN AGREEMENT, dated as of the _____ day of September, 1996 (the
"Loan Agreement" or "Agreement"), is made by and between TRANSEASTERN PEMBROKE
VILLAGES, INC., A FLORIDA CORPORATION, with its principal place of business at
0000 Xxxxxxxxxx Xxxxx, Xxxxx Xxxxxxx, Xxxxxxx 00000 ("Borrower"), and CHASE
FEDERAL BANK, A FEDERAL SAVINGS BANK, A DIVISION OF NATIONSBANK, N.A. (SOUTH), a
national banking association organized and existing under the laws of the United
States, with its offices located at 000 Xxxx Xxxxxxx Xxxxx Xxxx, Xxxxx 000, Xxxx
Xxxxxxxxxx, Xxxxxxx 00000 ("Bank").
RECITALS
A. Borrower has applied to Bank for a loan in the principal amount
of THREE MILLION AND NO/100 DOLLARS ($ 3,000,000.00) (the "Loan") to be used for
the purpose of the constructing of one hundred fourteen single family dwellings
on such individual lots now owned by Borrower in fee simple and mortgaged to
Bank as security for the Loan, which lots are to be located in a certain
residential development known as Egret's Way located upon certain property in
Broward County, Florida.
B. Bank has agreed to establish a note and mortgage structure under
which advances may be made for the land acquisition, development and the
construction of single family residential dwellings on individual lots in
accordance with plats, specifications, terms, and conditions approved by Bank.
C. Bank is willing to make the Loan described above based on the
terms and conditions set forth in this Loan Agreement and in the Loan Documents
referred to herein.
NOW, THEREFORE, in consideration of the premises, of the Loan advances
which are to be agreed to be made by Bank to Borrower hereinafter and the notes
and mortgage given by Borrower in evidence thereof, and for other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, Borrower and Bank hereby agree as follows:
ARTICLE I
DEFINITIONS
1.1 For the purposes hereof:
(a) "Approved Project" or "Project" means the collective
reference to the development identified in Section 2.4 of this
Agreement, together with the Land, the Improvements, rights, property,
and appurtenances as defined, described or identified in the Mortgage,
and means, as the context may require, an individual Unit, as well as
the aggregate of all such Units.
(b) "Architect" or "Supervising Architect" means that party who
will serve as Borrower's architect in conjunction with the
construction of Units and common amenities to be constructed in the
Approved Project. Bank's Construction Consultant and Borrower's
architect shall not be the same person or firm.
(c) "Architect's Contract" means the contract between Borrower
and the Architect "Architect's Contract" shall also mean Borrower's
design architect's contract.
(d) "Borrower's Representative" means the person or persons
designated in writing to Bank by Borrower as being authorized to
submit Draw Requests on Borrower's behalf and to consent to changes in
the Cost Breakdown and Use of Proceeds. Unless and until changed by
written notice to Bank, BorroWer designates any one of the following:
Xxxxxx Xxxxxxx or Xxx Xxxxxxxx as its Borrower's Representative(s).
(e) "Closing Date" means the date as of which this Loan Agreement
is executed by Borrower and Bank.
(f) "Collateral" means the Mortgaged Property, Rents, Intangible
Property and other property rights as defined in and encumbered by the
Mortgage.
(g) "Commitment" means Bank's commitment letter to Borrower dated
July 1, 1996 and all amendments thereto. The parties intend that this
Agreement and the Loan Documents shall supersede and replace the
Commitment.
(h) "Completion means completion of the Improvements in
accordance with the Plans, such Completion to be evidenced by
satisfaction of the conditions of Section 6.3 plus the installation of
any required items of personalty in substantial compliance with the
Plans, free and clear of liens or claims of liens or other
encumbrances, except Permitted Encumbrances;
(i) "Construction Documents" means the stipulated sum
construction contract between Borrower and the General Contractor, if
a General Contractor is engaged, and all other contracts, plans or
documents concerning the construction of the Improvements and any
addenda, amendments or modifications thereto. The Construction
Documents shall include a hard cost breakdown and a maximum fixed cost
for the performance of all services, labor, and materials furnished
thereunder.
(j) "Construction Inspector" means the architectural or
engineering firm or such party which Bank shall designate to perform
various services on behalf of Bank. The services to be performed by
Bank's Construction Inspector shall include the issuance of reports
and certifications solely for the benefit of Bank and shall not impose
upon Bank any obligation to make inspections, or to correct or require
any other person to correct any defects, or to notify any person with
respect to such defects, review of the Plans and all proposed changes
to them, preparation of a "cost breakdown" construction analysis (the
"Construction Analysis"), periodic inspections of construction work
for conformity with the Plans, and approval of Draw Requests.
(k) "Cost Breakdown" means the detailed trade breakdown of the
cost of constructing the Improvements and an itemization of
non-construction and Land costs, all as approved by Bank from time to
time.
(1) "Default" means a violation of any term, covenant, or
condition hereunder or a Default as defined under any of the other
Loan Documents which remains uncured after any applicable grace
period.
(m) "Default Condition" means the occurrence or existence of an
event or condition which, upon the giving of notice or the passage of
time, or both, would constitute a Default.
(n) "Draw Request" means a written or verbal request for any
disbursement of Loan proceeds, which shall be submitted for each
requested disbursement as set forth in Article III hereof, in
accordance with the draw request sheet attached hereto as EXHIBIT "A"
attached hereto and incorporated herein by reference.
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(o) "Engineer" shall mean such party who will serve as Borrower's
supervising engineer in accordance with the Plans and specifications;
(p) "Engineering Contract" means the "full service", contract
between Borrower and Engineer which shall require engineering services
throughout the Land development and construction contemplated under
the Loan.
(q) "Financing Statements" means the UCC financing statements
filed in order to perfect Bank's lien on certain personal property and
fixtures as more particularly described therein.
(r) "Firm Contract" means an arm's length, bona-fide binding
contract for purchase and sale, in form and content satisfactory to
Bank, for the sale of a Unit to a purchaser unaffiliated and unrelated
to Borrower or Guarantor, under which (i) Borrower has received a cash
deposit equal to ten percent (10%) of the purchase price except as
herein after provided; (ii) Borrower is not obligated to provide any
purchase-money financing, (iii) all applicable statutory cancellation
or rescission periods have expired, (iv) there are no contingencies
other than a first mortgage financing contingency for which Borrower
has confirmed to Bank that purchaser has made a mortgage application
and has received a mortgage commitment without contingencies, (v) the
closing date for the contract is within forty-five (45) days of the
date of issuance of the Certificate of occupancy for the Unit, and
(vi) the gross sales price, after payment of all of Borrower's closing
expenses thereunder, will result in sufficient proceeds to pay to Bank
the Unit Release Price and Lot Release Price. The purchaser's interest
in the Mortgaged Property and under the Firm Contract must be
expressly subordinated to the lien and operation of Bank's Mortgage,
either by separate subordination agreement in favor of Bank or
pursuant to the terms of the Firm Contract.
(s) "General Contractor" means Borrower who will serve as the
general contractor in accordance with the Construction Documents; if a
General Contractor is not engaged or is not named here, any obligation
of the General Contractor referred to in the Loan Documents shall be
the obligation of the Borrower to perform or to cause to be performed.
(t) "Governmental Authorities" means any local, state, or federal
governmental agency, regulatory body or office, or any
quasi-governmental office (including health and environmental), or any
officer or official of any such agency, office, or body whose consent
or approval is required as a prerequisite to the commencement of the
construction of the Improvements or to the operation and occupancy of
the Improvements or the Approved Project or to the performance of any
act or obligation or the observance of any agreement, provision or
condition of whatsoever nature herein contained.
(u) "Guarantor" means: Xxxxxx Xxxxxxx, Xxxxxx Xxxxxxx, Xxxxxx
Xxxxx and Transeastern Properties Inc., a Florida corporation, f/k/a
Transeastern Properties of South Florida, Inc., a Florida corporation.
(v) "Guaranty" means the Guaranty Agreement executed by Guarantor
in favor of Bank, providing for Guarantor's payment of all sums due
under the Loan Documents and of performance of all obligations of
Borrower thereunder except as otherwise specifically therein provided,
including, without limitation, timely completion of the Improvements
in accordance with the Construction Documents and Loan Documents.
(w) "Improvements" means all infrastructure improvements to the
Land and single family residences, structures, dwellings, and Units
constructed or to be constructed on the Land as defined in the
Mortgage, together with all fixtures and appurtenances now or later to
be located on the Land and/or in such Improvements.
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(x) "Land" means the real property described in the Mortgage at
the inception of the Loan as per EXHIBIT "F" attached hereto and as
may be later included by modification and spreader agreement.
(y) "Loan Documents" means this Loan Agreement, the Note and any
funding agreement, the Mortgage, the Guaranty, the Financing
Statements, and any other document or writing executed in connection
therewith or in furtherance thereof.
(z) "Lot Release Price" shall mean the partial release price as
set forth in EXHIBIT "B" attached hereto and incorporated herein.
(aa) "Model Unit" means a Unit constructed and furnished
initially for inspection by prospective purchasers.
(bb) "Mortgage" means the Real Estate Mortgage, Assignment and
Security Agreement of even date herewith executed by Borrower for the
benefit of Bank encumbering the Collateral (as defined in the
Mortgage), and any extensions, modifications, renewals or replacements
thereof.
(cc) "Note" means collectively the Promissory Note (for Revolving
Line of Credit) in the amount of THREE MILLION AND NO/DOLLARS
($3,000,000.00) ("Construction Line") dated as of the Closing Date
executed by Borrower in favor of Bank, as well as any promissory note,
sub-note, or other notes issued by Borrower in substitution,
replacement, extension, future advance, amendment or renewal of the
Note or any such promissory note or notes.
(dd) "Permitted Encumbrances" means those liens, encumbrances,
easements and other matters defined in the Mortgage as "Permitted
Encumbrances".
(ee) "Plans" means plans and specifications for the development
of the Land and construction of the Improvements submitted to and
approved by Bank from time to time, and including such amendments
thereto as may from time to time be made by Borrower and approved by
Bank.
(ff) "Pre-Sold Unit" means a Unit owned by Borrower and covered
by a Firm Contract.
(gg) "Security Documents" means the Mortgage, the Financing
Statements, and any other instrument executed to establish and perfect
Bank's lien on the Collateral, and any extensions, modifications,
renewals, or replacements thereof.
(hh) "Site Development Contractor" means such party who will
serve as the subcontractor for the site development of the Land as
contemplated under the Loan.
(ii) "Site Development Contract" means the contract between
Borrower and Site Development Contractor for the site development of
the Land per the site development Plans and specifications.
(jj) "Site Plan" means collectively the site plans for the
Project as set forth on EXHIBIT "E" attached hereto.
(kk) "Spec Unit" means a Unit for which a Firm Contract has not
been received or approved, and which is not used as a Model Unit.
(ll) "Title Policy" means the mortgagee title policy meeting the
requirements of this Loan Agreement.
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(mm) "Unit" means a portion of the Land and its respective
improvements constituting a single residential dwelling unit.
(nn) "Unit Release Price,, shall mean the partial release price
for each Unit funded under the Construction Line as set forth on
EXHIBIT "B" attached hereto and incorporated herein.
(oo) "Use of Proceeds" means the description of the permitted use
of the Loan proceeds under the A&D Note as set forth on EXHIBIT "A"
attached hereto and incorporated by reference herein.
Capitalized terms not defined in this Loan Agreement shall have the
meanings ascribed to them in the Mortgage.
ARTICLE II
THE LOAN
2.1 LOAN TERMS. Subject to the terms and conditions of this Loan
Agreement, Bank will lend and Borrower will borrow up to a principal sum of
THREE MILLION AND NO/100 DOLLARS ($3,000,000.00), which borrowing shall be
evidenced by the Note. Also, all of the terms, definitions, conditions, and
covenants of the Note, the Guaranty, the Mortgage, and any other documents
executed in connection therewith or pursuant thereto are expressly made a part
of this Loan Agreement by reference in the same manner and with the same effect
as if set forth herein at length and shall have the meaning set forth in such
instruments unless otherwise defined herein.
2.2 A&D NOTE. The A&D Note is a Consolidated Renewal Promissory Note
in the original principal amount of EIGHT MILLION SEVEN HUNDRED THIRTY SEVEN
THOUSAND FIVE HUNDRED AND NO/100 DOLLARS ($8,737,500.00), which note is secured
by a first mortgage in favor of Bank, dated March 29, 1996, and recorded April
3, 1996 in Official Records Book 24694 at Page 0702, of the Public Records of
Broward County, Florida, as modified by that certain Amended and Restated Real
Estate Mortgage Assignment, and Security Agreement of even date herewith
executed by Borrower in favor Bank.
2.3 CONSTRUCTION LINE. The Construction Line is a revolving line of
credit and the principal amount outstanding under such note may increase and
decrease from time to time as Borrower draws and repays note funds thereunder
but the principal balance of such note outstanding from time to time shall not
exceed the original, principal amount of the Construction Line. Provided
Borrower is not in Default, outstanding amounts under such note may be repaid or
reborrowed from time to time subject to the terms, conditions and limitations
set forth in this Agreement, but the principal balance of such note outstanding
from time to time shall not exceed the original, principal amount of the
Construction Line.
2.4 LOAN PURPOSE. The purpose of the Loan is to finance construction
costs of Units to be constructed in that certain Approved Project known as
Egret's Way, located in Pembroke Pines, Florida ("Egret's Way") which project
shall be hereinafter referred to as the "Approved Project". Disbursements of
Loan proceeds for construction of Units in other developments owned or
hereinafter acquired by Borrower or Units not meeting the following limitations
shall be at Bank's sole discretion, and Bank shall under no circumstances be
obligated to disburse Loan proceeds except as expressly set forth in this Loan
Agreement.
2.5 LIMITATIONS ON USE OF A&D NOTE PROCEEDS. INTENTIONALLY OMITTED.
2.6 LIMITATIONS ON USE OF CONSTRUCTION LINE PROCEEDS. Bank will
disburse Construction Line proceeds for the construction of Units subject to the
terms and conditions of this Loan Agreement, the Use of Proceeds attached as
Exhibit "A", and the following limitations:
5
(a) Construction Line proceeds shall be used solely to fund
construction of Units (i) for which Bank has approved the Plans and
(ii) having a maximum sales price of ONE HUNDRED NINETY THOUSAND AND
NO/100 DOLLARS ($ 190,000.00) or for which the total construction
costs as set forth in the Unit Cost Breakdown, excluding lot cost as
approved by Bank, do not exceed ONE HUNDRED EIGHT THOUSAND AND NO/100
DOLLARS ($108,000.00).
(b) Construction Line proceeds shall be used solely for the
direct and indirect costs to construct Units as set forth in the Unit
Cost Breakdown and approved by Bank. Borrower states for the express
benefit and reliance of Bank that it has not relied and is not relying
on any binding obligation on the part of Bank to finance the
construction of a particular number of Units unless Borrower has
performed the prerequisites for such construction as set forth in the
Loan Documents.
(c) The amount to be funded on each Pre-Sold Unit will be
determined by deducting the Lot allocation of TWENTY SIX THOUSAND
THREE HUNDRED SIXTEEN AND NO/100 DOLLARS ($26,316.00) from eighty
percent (80%) of the lesser of: (i) the "completed value" of such
Unit, which amount shall be determined by an appraisal satisfactory to
Bank (which appraisal shall be at Borrower's sole expense); or (ii)
the purchase price for the Unit reflected in the Firm Contract;
provided, however, that in no event shall Bank be obligated to fund
Construction Line proceeds in an amount in excess of one hundred
percent (100%) of the Unit Cost Breakdown submitted by Borrower and
approved by Bank.
(d) The amount to be funded on each Spec Unit and Model Unit will
be determined by deducting the Lot allocation of TWENTY SIX THOUSAND
THREE HUNDRED SIXTEEN AND NO/100 DOLLARS ($26,316.00) from seventy
five percent (75%) of the "completed value," of said Spec Unit or
Model Unit, which amount shall be determined by an appraisal
satisfactory to Bank (which appraisal shall be at Borrower'S sole
expense); provided, however, that in no event shall Bank be obligated
to disburse Construction Line proceeds in excess of one hundred
percent (100%) of the Unit Cost Breakdown for such Spec Unit or Model
Unit submitted by Borrower and approved by Bank.
(e) Use of Construction Line proceeds for the construction of
Units shall be limited to eight (8) Spec Units and four (4) Model
Units, at any one time, with the balance available for the
construction of Pre-Sold Units. Notwithstanding any provision in this
Agreement to the contrary, at any time no more than three (3) Spec
Units shall be permitted for any one home model type.
(f) Intentionally omitted.
(g) Each Pre-Sold Unit financed under the Construction Line shall
be completed, as defined in this Agreement, in a period not to exceed
nine (9) months from the date construction commences.
(h) The amount financed under the Construction Line must be
repaid in full (i) for any Spec Unit within (12) months from the date
construction commences on such Spec Unit and (ii) for any Model Unit
within thirty five (35) months from the date of this Agreement.
(i) only residential Units within the Approved Project shall be
financed by the Construction Line.
(j) At such time as the number of Spec Units financed under the
Construction Line has become eight (8) Spec Units, additional Spec
Units financed under the Construction Line may only be commenced upon
(a) repayment of all Loan advances for one of the eight (8) Spec
Units; or (b) at such earlier time as one of the Spec Units becomes a
Pre-Sold Unit. All Pre-Sold Units upon which the Sales Contract has
been canceled due to the default of the buyer and which are available
for sale, shall become designated as a Spec Unit. If, at any time, the
number of Spec Units exceeds eight (8) in number, the
6
Borrower shall not be permitted to request funding for construction of
any further Spec Units until the number of such funded Spec Units is
reduced to no more than eight (8) Spec Units.
(k) At such time as the number of Model Units financed under the
Construction Line has become four (4) Model Units, additional Model
Units financed under the Construction Line may only be commenced upon
(a) repayment of all Loan advances for one of the four (4) Model
Units; or (b) at such earlier time as one of the Model Units becomes a
Pre-Sold Unit. If, at any time, the number of Model Units exceeds four
(4) in number, the Borrower shall not be permitted to request funding
for construction of any further Model Units until the number of such
funded Model Units is reduced to no more than four (4) Model Units.
(l) The total amount to be funded for the costs of construction
of a Unit, as approved and allocated by Bank pursuant to Subparagraphs
2.5(a) through (e), inclusive, less the allocable loan amount per lot,
above shall be called the "Committed Unit Amount." Upon Bank's
approval of the commencement of construction of a Unit and the Bank's
approval of the Committed Unit Amount for said Unit, the Committed
Unit Amount shall be reserved under the Construction Line, and shall
not be available for disbursement for construction of any other Units
until such time as the Unit Release Prices repaid create amounts
available under the Construction Line. After making the initial
disbursement under the Committed Unit Amount, the remaining unfunded
Committed Unit Amount shall be disbursed on a percentage basis in
accordance with the terms of this Agreement. Bank shall not in any
case be obligated to approve or fund the construction of a new Unit
unless there are sufficient "available" Construction Line proceeds as
noted below to complete construction of that Unit. For purposes of
this Agreement, the term "available" Construction Line proceeds shall
mean the amount derived by subtracting the total Committed Unit
Amounts from the Maximum Committed Funding Amount of THREE MILLION AND
NO/100 DOLLARS ($3,000,000.00) as described below in subparagraph (m).
(m) Notwithstanding any provision in this Agreement to the
contrary, the number of Units (Model, Spec and Pre-Sold) financed
under the Construction Line shall be limited by a "Maximum Committed
Funding Amount" of THREE MILLION AND NO/100 DOLLARS ($3,000.000.00)
representing the total of all Committed Unit Amounts for all Units
under the Construction Line for which construction has commenced and
initial funding by Bank has been made. Regardless of the Maximum
Committed Funding Amount "availability" under the Construction Line,
consisting of up to THREE MILLION AND NO/100 DOLLARS ($3,000,000.00)
of "Committed Unit Amounts", the amount outstanding at any one time
under the Construction Line shall be no greater than THREE MILLION AND
NO/100 DOLLARS ($3,000,000.00).
2.7 LOAN MATURITY. The maturity date of the Construction Line shall
be September 1, 1999 with two (2) extension options of three (3) months each to
be granted at Borrower's request, at the sole and absolute discretion of Bank
and on the terms as set forth in the Construction Line Note. On the Maturity
Date of the Note, all sums outstanding under such notes shall be immediately due
and payable, and the Bank's obligation to fund shall cease and terminate.
ARTICLE III
DISBURSEMENTS
3.1 A&D NOTE DISBURSEMENT - GENERAL PROVISIONS. INTENTIONALLY
OMITTED.
3.2 CONSTRUCTION LINE DISBURSEMENT - GENERAL PROVISIONS. Bank agrees
that it will, from time to time, and so long as there shall exist no Default
Condition or Default (which has not been cured within any
7
applicable grace period), but not more frequently than two (2) times per month,
disburse Construction Line proceeds for the construction of Units in the
Approved Project, subject to the terms and conditions of this Agreement.
3.3 REQUEST FOR INITIAL FUNDING COMMENCEMENT OF CONSTRUCTION OF A
UNIT UNDER THE CONSTRUCTION LINE. When Borrower wishes to commence funding for
construction of a particular Unit, Borrower shall submit a draw request,
accompanied by all items required in Articles IV and V as conditions precedent,
to the extent applicable. All supporting documentation shall be submitted no
later than five (5) days prior to the requested date of the initial disbursement
under each note. No disbursement by Bank shall constitute an approval or
acceptance by Bank of any construction work or constitute a waiver by Bank of
any conditions precedent to any future disbursements. Bank shall not be
obligated to approve any disbursement for purposes other than those contemplated
in this Agreement. The conditions set forth in Articles IV and V hereof must be
satisfied before Bank will make the first advance or disbursement for the
development of Land or construction of a Unit, and the conditions set forth in
Article VI hereof must be and remain satisfied before Bank will make each
subsequent disbursement or advance.
3.4 INTERIM DRAW REQUESTS. No later than five (5) days prior to
disbursement by Bank, Borrower must submit to Bank a Draw Request, which shall
include or be accompanied by the requirements set out herein for draws.
3.5 DISBURSEMENT AMOUNTS. Following receipt of a Draw Request and
Bank's review and approval of supporting documentation, Bank shall determine the
amount of the disbursement it will make in accordance with the Percentage
Completion Draw Schedule, a copy of which is attached as EXHIBIT "D" provided no
Default Condition or Default exists.
3.6 EQUITY DISBURSEMENTS. Except as provided in Section 2.6(m), if
Bank at any time determines in its reasonable discretion that the Loan proceeds
plus the amount of all equity investments made or scheduled to be made are not
sufficient to fully complete the Improvements in accordance with the Plans and
to pay all other sums due under the Loan Documents, then Bank shall have the
option of requiring Borrower to deposit with Bank additional funds from some
other source (or submit evidence to Bank of equity investments previously made)
in amounts sufficient to cover the resulting deficit before Bank will disburse
any additional Loan proceeds. Deposited funds shall be advanced as construction
progresses in accordance with this Loan Agreement before any additional Loan
disbursements are made.
3.7 OPTION TO DISBURSE FUNDS TO ANY GUARANTOR AND/OR TO PAY
CONTRACTORS. If a Default shall exist, at its option, Bank may, after so
notifying Borrower, make Loan disbursements directly to any guarantor or obligor
of the debt when such party shall be performing the obligations of Borrower
hereunder or the General Contractor or any unpaid subcontractor, laborer or
material supplier providing labor, services or materials in connection with the
construction of the Improvements, and the execution of this Loan Agreement by
Borrower shall, and hereby does, constitute an irrevocable direction and
authorization to Bank to so disburse the funds. No further direction or
authorization from Borrower shall be necessary to warrant such direct
disbursements and all such disbursements shall be secured by the Security
Documents as fully as if made to Borrower, regardless of the disposition thereof
by the General Contractor, any subcontractor, laborer or material supplier so
paid.
ARTICLE IV
GENERAL PRE-CLOSING CONDITIONS
Bank's obligations to close the Loan shall be expressly conditioned upon
satisfaction of the following conditions, or execution and/or delivery to Bank
of the following items, all in form and substance reasonably satisfactory to
Bank and Bank's counsel:
4.1 NOTE. The original Note, properly executed, shall have been
delivered to Bank.
8
4.2 GUARANTY. The original Guaranty(s), properly executed, shall have
been delivered to Bank.
4.3 MORTGAGE. The Mortgage, which shall be a second lien on the Land
and Improvements, shall have been properly executed in recordable form and
delivered to Bank, subject to those matters reflected in the Title Policy.
4.4 INDEMNITY. The Hazardous Substance Certificate and
Indemnification Agreement, properly executed by Borrower and each Guarantor,
shall have been delivered to Bank.
4.5 FINANCING STATEMENTS. The Financing Statements on forms approved
for filing in the appropriate state and local filing offices shall have been
properly executed.
4.6 TITLE POLICY. A standard ALTA mortgagee title policy insuring the
lien of the Mortgage as a first priority lien encumbering the Land and
Improvements from a company or from companies approved by Bank (including any
reinsurance agreements required by Bank, together with direct access provisions
in favor of Bank): (1) providing coverage for the full principal amount of the
Loan, (2) providing a variable rate endorsement, if appropriate, the Form 9
Endorsement, the Revolving Loan Endorsement, the Survey Endorsement, and any
other endorsements requested by Bank, (3) deleting all "standard" exceptions
except taxes for the current year, (4) insuring all appurtenant easements, (5)
containing no bankruptcy or creditors' rights exceptions or exclusions; and (6)
containing no title exceptions other than the Permitted Exceptions or the other
exceptions approved by Bank.
4.7 TITLE EXCEPTIONS. Copies of all documents creating exceptions to
the Title Policy.
4.8 SURVEY/RECORDED AND PRELIMINARY PLAT/APPROVED SITE PLAN. Three
(3) copies of a recent survey of the Land prepared by a registered land surveyor
acceptable to Bank and certified to Bank, the title insurance company, and
Borrower. Such survey shall contain a certification as to the applicable flood
zone (s) for the Land, and a certification that the survey was and in accordance
with the Minimum Technical Standards for Surveys as set fourth in Chapter
21HH-6, Florida Administrative Code. In addition, a copy of the boundary plat
for the Land and a copy of the site plan is required approved by all applicable
governmental authorities. Notwithstanding the foregoing, the Bank will not
unreasonably withhold its consent to the execution of the final plat and will
join when requested by Borrower. A recorded copy of the plat shall be delivered
to Bank prior to any Construction Line funding requests for Units with Firm
Contracts.
4.9 FLOOD HAZARDS. Evidence as to whether or not the Land is located
within an area identified as having "special flood hazards" as such term is used
in the Federal Flood Disaster Protection Act of 1973.
4.10 FLOOD HAZARD INSURANCE. If all or any part of the Improvements is
or is to be located in an area having "special flood hazards", a flood insurance
application or policy naming the Bank as mortgagee must be submitted to Bank at
such time as it is commercially available. Satisfactory evidence of premium
payments must also be provided.
4.11 BUILDER'S RISK INSURANCE. A builder's risk insurance policy
meeting the requirements set forth in the Mortgage.
4.12 LIABILITY INSURANCE. Liability insurance meeting the requirements
set forth in the Mortgage.
4.13 BORROWER'S ORGANIZATIONAL DOCUMENTS AND RESOLUTIONS. A certified
copy, from the appropriate governmental body or corporate officer, of
organizational documents of Borrower, and any partner of Borrower, as
appropriate, certifying that Borrower and/or such partner (i) is duly organized,
validly existing, and in good standing under the state of its existence, (ii)
has the authority under such documents and laws to enter into the Loan as
contemplated by the Loan Documents, and (iii) has made all appropriate filings,
including without limitation,
9
qualification to do business in the State of Florida, necessary to enter into
the Loan and execute the Loan Documents. Additionally, Borrower shall provide
(i) if appropriate, certified resolutions or other internal documents or writing
of Borrower and such partner evidencing that Borrower and such partner have
taken all requisite organizational action, and received all organizational
approvals necessary to enter into the Loan and execute the Loan Documents, and
(ii) such other documents or writings as Bank may request.
4.14 GUARANTOR'S ORGANIZATIONAL DOCUMENTS AND RESOLUTIONS.
INTENTIONALLY OMITTED.
4.15 FICTITIOUS NAME CERTIFICATE. If Borrower utilizes or intends to
utilize a fictitious name, a copy of the Fictitious Name Certificate of the
Borrower issued by the Florida Secretary of State.
4.16 ATTORNEY'S OPINION. The written opinions of counsel to Borrower
and Guarantor, addressed to Bank, acceptable to Bank and Bank's counsel, as to
those matters required by Bank. The attorney's opinion, with respect to the
enforceability of remedies provided in any instrument may be made subject to or
affected by, applicable bankruptcy, moratorium, reorganization, insolvency or
similar laws from time to time in effect affecting the rights of creditors
generally. As to matters of fact, such opinions may be qualified to the extent
of the knowledge of such counsel based upon inquiry and reasonable
investigation.
4.17 RESTRICTIVE COVENANTS. A copy of the executed and recorded
homeowners, documents, filed articles of incorporation for the homeowners,
associations, executed by-laws for the associations, and any other related
documents as Bank may request for the Approved Project. Notwithstanding the
foregoing, such documents shall be delivered to Bank prior to any Construction
Line funding for Units with Firm Contracts and Bank agrees to not unreasonably
withhold or delay its consent to such documents.
4.18 FINANCIAL STATEMENTS. The updated Borrower prepared financial
statements certified to the Bank must be received by Bank within thirty (30)
days of the Closing Date. With respect to the Guarantors, signed personal
financial statements on Bank forms shall be required prior to the Closing Date.
All statements must include income and contingent liability information.
4.19 COMPLIANCE WITH LAWS AND MATTERS OF RECORD. Satisfactory
documentary evidence that the Land, and the intended uses of the Land are in
compliance with all applicable laws, regulations and ordinances and private
covenants, easements, and conditions of record. Such evidence is subject to
approval by Bank and Bank's counsel and may include letters, licenses, permits,
certificates and other correspondence from the appropriate Governmental
Authorities, opinions of Borrower's counsel or other counsel, and opinions or
certifications from the Architect, Engineer and the General Contractor. The
laws, regulations and ordinances with which compliance should be evidenced
include without limitation the following: health and environmental protection
laws, laws related to or regulating water management districts, hazardous
materials and substances and stormwater drainage, erosion control ordinances,
tree and landscaping ordinances, building codes, land use requirements,
threshold building consultant requirements, the Development of Regional Impact
Statutes, doing business and/or licensing laws and zoning laws (the evidence
submitted as to zoning should include the zoning designation made for the Land,
the permitted uses of the Land under such zoning designation and zoning
requirements as to parking, lot size, ingress, egress and building setbacks).
4.20 TAXES. Evidence that the Land is, or will be, separately assessed
for tax purposes and information as to tax parcel identification numbers, tax
rates, estimated tax values and the identities of the taxing authorities. Also,
Borrower shall submit proof that the taxes are paid current upon the Land.
4.21 UTILITIES. Evidence of the availability and suitability of the
water, sewer, telephone, electrical, and other utilities needed to properly
service the Project in its intended use.
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4.22 PLANS AND SPECIFICATIONS. Two sets of the site development Plans
which must have been approved in writing by Borrower and the General Contractor
either by initialing same or by other written approval identifying all pages and
dates, including revision dates. The Plans must include all site development
(including storm drainage, utility lines, erosion control and landscaping) plans
and specifications and must incorporate the recommendations in the soil testing
report. Bank will engage its engineer to review such Plans to determine
sufficiency of such under its guidelines.
4.23 PERMITS. Borrower will provide a copy, certified by the Borrower
to be a true and correct copy of the South Florida Water Management District
Permit, if applicable.
4.24 SOIL TESTS. A report as to soil borings made on the Land by a
soil testing firm satisfactory to Bank. The number and location of such borings
shall be in accordance with the recommendations of the soil testing firm and
must also be satisfactory to Bank. The report shall include the recommendations
of the soil testing firm as to the preparation of the soil needed in order to
adequately support the Improvements, and shall be delivered and approved by Bank
within sixty (60) days of the date of this Agreement.
4.25 ENVIRONMENTAL ASSESSMENT.
(a) An environmental assessment of the Land and Improvements
performed at Borrower's expense by a licensed engineer or other
environmental consultant satisfactory to Bank stating that:
i. the Land is not located within any area designated as a
hazardous substance site by any of the Governmental Authorities;
and
ii. no hazardous or toxic wastes or other materials or
substances regulated, controlled, or prohibited by any federal,
state, or local environmental laws, including but not limited to
asbestos, are located on the Land or Improvements; and
iii. the Land has not been cited or investigated in the past
for any violation of any such laws, regulations, or ordinances.
(b) If the environmental assessment shall reveal any condition
unacceptable to Bank, same shall constitute a Default hereunder and in
addition to all remedies available to Bank, Bank shall be relieved of
any obligation under the Commitment. If the environmental assessment
recommends, or if Bank so requests, in its sole and absolute
discretion, a Phase II audit, additional testing or remedial action,
Borrower, at its sole cost and expense shall promptly conduct such
additional audits and testing and/or complete such remedial action.
Bank may require the Borrower to provide evidence that all necessary
actions have been taken to remove any hazardous substance
contamination and/or to restore the site to a condition acceptable to
Bank and state and federal governmental agencies.
4.26 TAXPAYER IDENTIFICATION NUMBER. Borrower's federal taxpayer
identification number.
4.27 BORROWER'S AFFIDAVIT. An affidavit of Borrower regarding the
absence of any other parties in possession of the Land, stating that a notice of
commencement has not been filed with respect to the Property, the
non-commencement of construction of Improvements , and such other matters as may
be requested by Bank.
4.28 COMMITMENT FEE. The balance of the non-refundable commitment fee
in the total amount of THIRTY FOUR THOUSAND AND NO/100 DOLLARS ($34,000.00)
which was earned upon acceptance of the Commitment and the reserving of
sufficient funds by Bank from which to make Loan disbursements, and is due and
payable whether or not any disbursements are made hereunder.
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4.29 APPRAISAL. Bank shall have received a narrative appraisal
certified to the Bank for the Land and site development improvements prepared by
an appraiser acceptable to Bank.
4.30 COMPREHENSIVE PLAN. Documentary evidence, satisfactory to Bank
and its counsel, that Borrower's development proposal for the Project and the
construction of the Improvements are consistent with concurrency requirements
and other applicable provisions of the local comprehensive plan and local land
development regulations, as defined and required by the Local Government
Comprehensive Planning and Land Development Regulation Act, Florida Statutes.
Section 163.3161, et seq.
4.31 FACILITIES FOR HANDICAPPED. Subsequent to the Closing Date but
not later than the commencement of the construction of the sales center or the
clubhouse, as applicable, Bank shall have received and approved evidence,
satisfactory to Bank, that the Plans and specifications do, and the
Improvements, when constructed, will comply to the extent applicable with all
legal requirements regarding access and facilities for handicapped or disabled
persons, including, without limitation, and to the extent applicable, Part V of
the Florida Building Construction Standards Act entitled "Accessibility by
Handicapped Persons", Chapter 553, Fla Stat.; the Federal Architectural Barriers
Act of 1988 (42 U.S.C. ss.4151, et. seq.), The Fair Housing Amendment Act of
1988 (42 U.S.C. ss.3601, et. seq), The Americans With Disabilities Act Of 1990
(42 U.S.C. ss.12101 et. seq.), and The Rehabilitation Act of 1973 (29 U.S.C.
ss.794).
4.32 CONTRACTS. A copy of the executed contract for the purchase of
the Land by the Borrower, if applicable.
4.33 SUBORDINATION AGREEMENTS. Borrower will provide a fully executed
original Loan Subordination Agreement, which document shall be recorded in the
Public Records of Broward County, evidencing the subordination of Amresco
Funding Corporation, a Delaware corporation's interest, as evidenced by that
certain Mortgage, Assignment of Rents, and Security Agreement, dated March 29,
1996, and recorded April 3, 1996 in Official Records Book 24694 at Page 0744, of
the Public Records of Broward County, Florida (the "Amresco Third Mortgage") and
that certain Contingent Mortgage, Assignment of Rents and Security Agreement,
dated March 29, 1996 and recorded April 3, 1996, in Official Records Book 24694
at Page 0787, of the Public Records of Broward County, Florida, (the "Amresco
Fourth Mortgage") the Bank's Mortgage.
4.34 MISCELLANEOUS. All other Loan Documents or items that are
customarily provided in loan transactions of this type and all other loan
documents or items set forth in the Commitment.
ARTICLE V
CONDITIONS PRECEDENT TO FIRST SITE DEVELOPMENT AND
CONSTRUCTION DISBURSEMENTS
5.1 A&D NOTE DISBURSEMENTS. INTENTIONALLY OMITTED.
5.2 CONSTRUCTION LINE DISBURSEMENTS. Under the Construction Line,
Bank shall not be obligated to make the first Loan disbursement for construction
of a particular Unit until all of the following conditions have been satisfied
by proper evidence, execution and/or delivery to Bank of the following items,
all in form and substance reasonably satisfactory to Bank and Bank's counsel:
(a) There shall be no Loan Default or Default Condition, which
has not been cured within any applicable grace period.
(b) The Land shall be free and clear of all liens and
encumbrances except for Bank's Mortgages in favor of Bank and the
Permitted Exceptions, the Amresco Third Mortgage and the Amresco
Fourth Mortgage.
12
(c) All conditions precedent as set forth in Article IV shall
have been satisfied.
(d) Bank shall have received an appraisal for such Unit, in form
and substance satisfactory to Bank, indicating its "completed value".
(e) If the Unit is a Pre-Sold Unit, the requirements necessary
for establishing a Firm Contract shall have been met.
(f) Bank shall have received satisfactory evidence that the Unit
is covered by Borrower's builder's risk insurance policy; if the Unit
is located in a flood hazard zone, Bank shall have received
satisfactory evidence that the Unit is covered by Borrower's flood
insurance policy or that application for flood insurance has been
made.
(g) Bank shall have received a true and correct copy of the Cost
Breakdown and Plans for that Unit type.
(h) Bank shall have received a copy of the Notice of Commencement
recorded for that Unit under the Florida Construction Lien Act, which
Notice of Commencement must have been recorded after the recording of
Bank's Mortgage.
(i) Bank shall have received and approved Borrower's Draw
Request.
(j) Bank is satisfied that all roads necessary for ingress and
egress to the Unit and the Approved Project have been completed or
will be completed and that all utility services necessary for the
construction of the Improvements are available at the boundaries of
the Land and will be available to the boundary of the lot upon which
the Unit will be constructed.
(k) Borrower shall have paid to Bank a fee in the amount of ONE
HUNDRED FIFTY AND NO/100 DOLLARS ($150.00) per Unit for property
inspections in connection with up to a maximum of ten (10) draw
requests (such fee may be paid from the initial construction funding
on each Unit). Thereafter, Borrower shall pay Bank FIFTY AND NO/100
DOLLARS ($50.00), for each inspection per Unit in connection with a
draw request (such fee shall be a charge against the per Unit
construction funding for such Unit).
(l) Bank shall have received a copy of the building permit and
all permits pursuant thereto for the Unit to be constructed.
(m) The third party purchaser's interest in the Mortgaged
Property and under the Firm Contract shall be expressly subordinated
to the lien and operation of Bank's Mortgage.
(n) Two sets of the Plans (including standard Unit floor plans)
which must have been approved in writing by Borrower and the General
Contractor either by initialing same or by other written approval
identifying all pages and dates, including revision dates. The Plans
must include architectural, structural, mechanical, plumbing and
electrical plans and specifications and must incorporate the
recommendations in the soil testing report.
(o) APPRAISAL. Borrower shall have furnished Bank with narrative
appraisals certified to the Bank for each base Unit model type on a
standard non-premium lot prepared by an appraiser acceptable to Bank.
13
(p) COST BREAKDOWN. A detailed cost breakdown for the
construction of each base Unit model type. At Borrower's expense, Bank
will engage its engineer to review such costs to determine sufficiency
of same under the Bank's guidelines.
(q) CONTRACTS. The proposed contract for sale and purchase of a
completed Unit, and other documents to be used by Borrower to market
and convey Units in the Approved Project.
(r) ARCHITECT'S CONTRACT. Copies of the contracts signed by
Borrower and Architect for design and supervisory services.
(s) CONTRACTOR'S CONTRACT. Copies of the contracts signed by the
Borrower and Contractor for construction services related to the
Units.
(t) CONSENT OF THE ARCHITECT. Consents from the Architect to
Borrower's assignments to Bank of Borrower's interests in the contract
with such party. In addition, the design architect, if any, shall
agree that Bank may use and copy the Plan if a Default occurs. In
furtherance of the assignment granted herein, Borrower shall cause all
contract parties to acknowledge this assignment to Bank and agree to
continue such contract on the same terms as presently exist if Bank
shall succeed to the interest of Borrower thereunder and if so
requested by Bank.
ARTICLE VI
CONDITIONS PRECEDENT TO DISBURSEMENTS
FOLLOWING THE FIRST DISBURSEMENT
6.1 GENERAL PERIODIC DISBURSEMENTS UNDER THE A&D NOTE AND
CONSTRUCTION LINE. Bank shall not be obligated to make any Loan disbursements
after the first disbursement provided for in Article V under the A&D Note or the
Construction Line until all of the following conditions have been and remain
satisfied as of the date of each such disbursement:
(a) All of the conditions stated in Article III hereof,
including, without limitation submission of a Draw Request.
(b) A request for payment signed by Borrower setting forth a
detailed breakdown of the disbursement requested in a format
acceptable to Bank.
(c) Construction of the Improvements for which such Draw Request
has been made has been performed in accordance with the Plans, the
Construction Schedule, and all terms and conditions hereunder.
(d) The Title Policy insurer shall have issued to the Bank an
ALTA Construction Endorsement Form to the Title Policy updating the
Policy and listing any additional subordinate matters or certifying
that no lien or other interest shall have attached to the Project
other than the interest of Bank pursuant to the lien of the Security
Documents, whether superior or subordinate to such lien, except taxes
for the current year and other matters acceptable to Bank, and there
are no liens which may take priority over the disbursement to be made
and there are no survey exceptions not theretofore approved by Bank in
writing.
(e) At the time of each disbursement: (i) Bank is reasonably
satisfied with the progress of construction; (ii) in Bank's reasonable
opinion, the equity requirements set out in Section 2.5 and 3.6 are
satisfied; and (iii) no Default Condition or Default exists under the
Loan Documents.
14
(f) Bank shall have received Bank's Construction Inspector's
approval to the Borrower's requisition for any hard costs.
(g) Bank shall have received copies of all notarized partial
release lien waiver forms executed by each appropriate subcontractor,
supplier and/or materialman which have filed a Notice to Owner.
(h) An Owner's Affidavit from Borrower certifying that the funds
disbursed to date by Bank have been paid to the appropriate parties.
(i) No litigation, arbitration or other proceeding shall have
been commenced against Borrower or the General Contractor, which in
Bank's judgment, materially impairs, or is likely to materially impair
the Borrower's or the General Contractor's ability to complete the
Project.
(j) As and when reasonably requested by Bank, a recertification
of the Survey reflecting all changes in the physical conditions of the
Land and Improvements subsequent to the date of the last certification
of the Survey. Each such recertification shall show all construction
work in place.
(k) Bank, based on the advice of its Construction Inspector, must
believe in its reasonable opinion that construction can be completed
within the time frame set forth in Paragraph 2.6(g) herein as to the
Units under the Construction Line.
(l) There shall not have been any destruction or casualty to the
Improvements not covered by insurance.
(m) If the Draw Request requires an amendment to the Use of
Proceeds or the Percentage Completion Draw Schedule or reallocation of
hard cost items which would require contractor and lienor notice under
ss.713.347(2), Fla. Stat., written notice from owner to the Contractor
and all required lienors, in compliance with ss.713.347,(2) Fla.
Stat., and countersigned by the Contractor and any lienors who have
provided notices to owner.
(n) RETAINAGE. Bank has the right to withhold the final six
percent (6.0%) of the individual unit's construction loan until such
time as the Certificate of Occupancy or Final Certificate of
Inspection by the appropriate governmental authority is issued.
6.2 CONSTRUCTION LINE PERIODIC DISBURSEMENTS. The following
additional conditions shall have been and remain satisfied as of the date of
each Construction Line disbursement for a Unit:
(a) At request of Bank, if the slab has been poured on a lot, a
satisfactory foundation or tie-in survey for such lot shall have been
submitted to Bank consistent with the requirements herein prior to any
draws subsequent to the initial draw.
(b) At request of Bank, soil report as to the compaction and
other soil test on the Land by a soil testing firm satisfactory to
Bank, at such times and in such locations as recommended by such firm.
Borrower shall promptly submit to Bank copies of all such reports,
together with any other physical tests made on the Land, the
Improvements, or the materials to be incorporated into the Improvement
and shall, at its sole cost and expense, cause such additional test to
be made from time to time, as Bank may reasonably require.
(c) At such time as any portion of the Improvements are occupied,
Borrower shall submit to Bank an "all risk" permanent hazard insurance
policy with respect to such Improvements, complying with the
requirements set forth in the Mortgage, and including a Replacement
Cost and Agreed
15
Amount/Stipulated Value Endorsement and such other endorsements as are
deemed necessary by Bank, together with evidence that all insurance
premiums have been paid.
(d) After the slab has been poured, no additional advances toward
construction shall be made until after the effective date of the flood
hazard application/policy.
6.3 REQUIREMENTS FOR DISBURSEMENT AT COMPLETION. Bank shall not be
obligated to make the final construction disbursement for a Unit until all of
the following additional conditions have been satisfied:
(a) The Units which have been commenced have been substantially
completed and are substantially in accordance with the Plans, and
certificates as to such Completion have been issued in satisfactory
form to Bank by the Architect/Engineer and the General Contractor,
including, without limitation, Architect's Certificate of Completion
together with AIA G704 Certificate of Substantial Completion,
Contractor's Certificate of Completion together with the AIA G704
Certificate of Substantial Completion and, if applicable, the
Engineer's Certificate of Completion, and certificates as to occupancy
and use have been issued by the appropriate Governmental Authorities
(and copies provided to Bank).
(b) Bank has received three (3) copies of an "as-built" survey
prepared by a registered surveyor consistent with Section 4.8 above
and additionally showing all of the Improvements in place.
(c) Bank has received two sets of detailed as-built plans and
specifications approved and identified as such in writing by Borrower,
the Architect/Engineer and the General Contractor. The two sets must
include plans and specifications for (i) as to the Construction Line,
architectural, structural, mechanical, plumbing and electrical
details; and (ii) as to the A&D Note, all site development (including
without limitation, storm drainage, easements, utility lines and
landscaping) work, as applicable.
(d) Bank has received final lien waivers and releases from the
General Contractor and all general contractors, subcontractors,
subcontractors, suppliers, laborers, and materialmen certifying that
they and all parties in privity with them have been paid in full and
waiving their lien rights against the Project (or such lot, as
appropriate).
(e) Bank has received an inspection report performed by this
Construction Inspector in substance satisfactory to Bank and
Construction Inspector's written approval of the final Draw Request.
ARTICLE VII
THE BORROWER'S CONVENTS AND AGREEMENTS
7.1 PAYMENT AND PERFORMANCE. Borrower will pay when due or within any
applicable grace period all sums owing to Bank under the Note, this Loan
Agreement, the Mortgage and the other Loan Documents, and perform all
obligations as outlined or referenced therein.
7.2 FURTHER ASSURANCES. On demand by Bank, Borrower will do any act
and execute any additional documents reasonably required by Bank to secure the
Loan, to confirm or perfect the lien of the Security Documents, including, but
not limited to, additional financing statements or continuation statements, new
or replacement notes and/or Security Documents and agreements supplementing,
extending or otherwise modifying the Loan Documents, certificates as to the
amounts of the indebtedness evidenced by the Note from time to time, and
certificates that Borrower knows of no defaults by or defenses or set-offs
against Bank as long as such certificate represents the true statement of
Borrower.
16
7.3 CONSTRUCTION. The Borrower will: (a) continue conscientiously the
construction of the Improvements; (b) not discontinue or permit the
discontinuance of work on the Improvements for longer than fifteen (15)
consecutive days, (c) in any event, complete the Improvements, including
installation of any required items of personalty in substantial compliance with
the Plans, free and clear of liens or claims of liens for material supplied or
for labor or services performed in connection with the construction of the
Improvements; and (d) not file, prior to the recording of the Mortgage, a Notice
of Commencement for the Approved Project. Notwithstanding the foregoing, any
delays in the event of unavailability of materials at reasonable cost, strikes,
other labor problems, governmental order, acts of God or other events which
would support a defense based upon impossibility of performance for reasons
beyond the control of Borrower shall not be a breach of Borrower's
responsibilities under this Section VII.
7.4 PAYMENT OF CONTRACTORS. Borrower covenants to advise Bank
immediately, and in writing if Borrower receives any claim of lien in connection
with any services, labor or materials furnished in connection with the
construction of Units, and to remove such liens within thirty (30) days of the
date of filing. Borrower shall comply with the Construction Contract Prompt
Payment Law contained in the Florida Construction Lien Law, Chapter 713, Fla.
Stat. Notwithstanding the foregoing, Borrower shall not be in Default under this
paragraph if the number and amount of such liens are under the amounts set forth
in Section 9.1(g).
7.5 FEES AND EXPENSES. Whether or not the Loan is made or all Loan
proceeds disbursed hereunder, Borrower agrees to pay all expenses incurred by
Bank, or by Borrower in order to meet Bank's requirements, in connection with
the Loan, including without limitation, commitment and renewal fees or deposits
to Bank, fees for appraisal, environmental assessment, reappraisal, survey,
recording, title insurance, builder's risk and other insurance premiums,
brokerage commissions and claims of brokerage, property taxes, intangible taxes,
documentary stamp taxes, architect's fees, engineer's fees, inspection fees, the
General Contractor's fees, and such legal fees and costs incurred by Bank in
connection with the making and administration of the Loan, the enforcement, of
Bank's rights under the Loan Documents, arbitration, the renewal, modification,
or extension of the Loan, or in connection with litigation or threatened
litigation by a third party which arises because Bank made the Loan. Any such
amounts paid by Bank shall constitute part of the indebtedness which is secured
by the Security Documents, and shall be due and payable upon demand.
7.6 INSURANCE. Borrower covenants to maintain insurance, as required
herein and in the Mortgage.
7.7 TAXES AND INSURANCE. Upon the request of Bank, Borrower shall
submit to Bank such receipts and other statements which shall evidence, to the
satisfaction of Bank, that all taxes (by April 30th of each year), assessments
and insurance premiums have been paid in full.
7.8 TITLE POLICY. When requested by Bank during the Loan term,
Borrower shall provide an endorsement to the Title Policy certifying that (a)
real estate taxes due through such date have been paid; (b) no additional
restrictions or encumbrances are of record which have not been approved by Bank;
and (c) no liens or lis pendens have been filed against the Land or the
Improvements. In the event that periodic title endorsements are not required to
be issued in connection with the title insurance, Borrower agrees to cause title
endorsements to be issued as reasonably required by Bank. When requested, after
the final disbursement of Loan proceeds, Borrower will provide Bank with an
endorsement to the Title Policy insuring the principal balance of the Loan and
containing no exceptions not approved by Bank.
7.9 ADDITIONAL CONSTRUCTION. Borrower shall not construct or permit
the construction of any improvements other than options prepaid by end
purchasers on the Approved Project other than those Improvements described in
the Plans, or approved in writing by Bank.
7.10 SALES REPORTS. Within ten (10) days after the end of each month
Borrower shall deliver to Bank a Sales Report covering that month such Sales
Report shall include, among other things as may be required by Bank,
17
a cumulative summary of the number of Units sold, closed and under construction
as well as the number of Spec and Model Units in each Transeastern Properties,
Inc., a Florida corporation project.
7.11 INSPECTION. Borrower will permit Bank and its authorized agents
to enter upon the Project during normal working hours and as often as Bank
desires, for the purpose of inspecting the construction of the Improvements.
When requested, Borrower will furnish to Bank detailed plans, shop drawings and
specifications which relate to the Improvements. Failure of Bank or its
authorized agents to discover deficiencies in or to reject materials or
workmanship incorporated or provided to the Improvements shall not make Bank or
its agent liable to Borrower or to any other person on account of such failure,
nor shall any prior failure constitute a waiver of Bank's right to subsequently
reject any such workmanship or materials. Borrower specifically acknowledges
that all inspections undertaken by Bank or its agent shall be for the sole
benefit of Bank and not for Borrower, any Guarantor, or any third party.
7.12 FOUNDATION AND OTHER SURVEYS. Under the Construction Line, upon
the completion of the construction of the foundation of each unit, Borrower will
promptly submit to Bank for its approval one (1) copy of a foundation survey of
the Project prepared by a registered land surveyor and consistent with the
requirements of Section 4.8 above. In addition to the surveys specifically
required by this Agreement, Borrower shall provide Bank during construction with
such additional surveys as requested by Bank.
7.13 SOIL AND OTHER TESTS. A report as to the compaction or other soil
tests made on the Land by a soil testing firm shall also be submitted to Bank
when so requested in accordance with the requirements of paragraph 4.24 above.
The number and locations of such soil tests shall be in accordance with the
recommendations of the soil testing firm. Borrower shall promptly submit to Bank
copies of reports of all other physical tests made on the Land, the Improvements
or the materials to be incorporated into the Improvements and shall, at
Borrower's expense, cause to be made such additional tests from time to time as
Bank may reasonably require.
7.14 USE OF LOAN FUNDS. Borrower shall use all Loan proceeds disbursed
to Borrower solely in payment of costs incurred in connection with constructing
the Project, in accordance with the Cost Breakdown and Use of Proceeds.
7.15 AVAILABILITY OF UTILITIES. All utility services necessary for the
construction of the Improvements and the operation thereof for their intended
purposes are presently available or will be available when needed through
presently existing public or unencumbered private easements or rights-of-ways in
accordance with validly executed and enforceable utility service agreements
between Borrower and the provider of each of such services (the "Utility Service
Agreements"), if applicable (which would inure to the benefit of Bank in the
event of the foreclosure of the Mortgage) at the boundaries of the Land,
including but not limited to, water, storm and sanitary sewer, gas, electric and
telephone facilities, and all such utilities are non-interruptible. Borrower
shall also provide Bank with copies of all Utility Service Agreements.
7.16 HAZARDOUS SUBSTANCES. Borrower affirms and incorporates by
reference the representations, warranties, terms, conditions, and indemnities
contained in that certain Hazardous Substance Certificate and Indemnification
Agreement of even date herewith.
At any time deemed necessary by Bank, in its sole and absolute
discretion, Bank may, at its election, obtain one or more environmental
assessments of the Land prepared by a geohydrologist, an independent engineer,
or other qualified consultant or expert approved by Bank evaluating or
confirming (i) whether any Hazardous Substances as defined in other Loan
Documents are present in the soil or water at the Land and (ii) whether the use
and operation of the Land complies with all applicable Environmental Laws
relating to air quality, environmental control, release of oil, hazardous
materials, hazardous wastes and hazardous substances, and any and all other
applicable environmental laws. Environmental assessments may include detailed
visual inspections of the Land including, without limitation, any and all
storage areas, storage tanks, drains, dry xxxxx, and leaching areas,
18
and the taking of soil samples, surface water samples, and ground water samples,
as well as such other investigations or analyses as are necessary. or
appropriate for a complete determination of the compliance of the Land and the
use and operation thereof with all applicable Environmental Laws. Such
environmental assessments shall be at the sole cost and expense of Borrower. In
the event that it is determined that additional tests and/or remediation are
necessary as a result of the aforesaid assessments, or in the event such
additional testing or remediation is recommended by the aforesaid assessments,
the Borrower agrees to immediately perform the tests or undertake the
remediation as recommended. In the event contamination or other environmental
problem is found on the Property, the Borrower shall be in Default hereunder
after a thirty (30) day cure period.
7.17 CAPITAL ADEQUACY. INTENTIONALLY OMITTED.
7.18 INDEMNIFICATIONS. The Borrower and the Guarantor shall indemnify
and hold Bank and its directors, officers, agents, employees, and attorneys
harmless from all liability, loss, expense or damage of any kind or nature,
including, without limitation, any suits, proceedings, claims, demands, or
damages (including attorneys' fees and costs paid or incurred in connection
therewith at both trial and appellate levels), incurred or arising by reason of:
(a) The Commitment or the making of the Loan (except for
liability, loss, expense or damage arising from the willful misconduct
or gross negligence of Bank);
(b) Any claim or action for the payment of any brokerage
commissions or fees which may be claimed to be payable in connection
with the Commitment; and
(c) The past, present or future handling, storage,
transportation, or disposal of hazardous substances upon the Land.
Notwithstanding the foregoing, Borrower's and Guarantor's indemnity
shall be limited to the extent provided in the Hazardous Substance
Certificate and Indemnification Agreement executed by such parties as
of the Closing Date.
These indemnifications shall survive the full payment and performance
of the obligations of the Borrower under the Loan documents except as set forth
above and in the Hazardous Substance Certificate and Indemnification Agreement.
7.19 FINANCIAL STATEMENTS. Borrower and each Guarantor shall submit
annual and interim financial statements as set forth below and when so requested
by Bank. Such statements shall include, at a minimum: a balance sheet; an income
and expense statement; a statement showing contingent liabilities; and any
supporting schedules or documentation which Bank may require. Each unaudited
statement must contain a certification to Bank of the statement's accuracy and
completeness signed by an authorized officer or the individual, as applicable.
Annual statements of business entities (including corporations and partnerships)
shall be audited by a certified public accountant reasonably acceptable to Bank
and shall be submitted no later than one hundred twenty (120) days after fiscal
year end. Interim statements shall be submitted within forty five (45) days of
each quarter end certified to Bank by the financial officer of Borrower.
Guarantor's personal financial statement shall be submitted to Bank prepared on
Bank's approval form within one hundred twenty (120) days of each calendar year
end. Borrower and Guarantor shall provide Bank with annual tax returns within
thirty (30) days of filing.
7.20 APPRAISALS. Bank must order, at Borrower's expense, and receive a
narrative discounted appraisal on the Land by an appraiser acceptable to Bank
and Bank must review said appraisal prior to Closing Date. At any time during
the term of the Loan, the Loan balance, including the unfunded but committed
portion, may not be in excess of seventy five percent (75%) of the Loan-to-value
with "value" being defined as, on a discounted basis, "as if" fully developed
with respect to Land for which development funding has commenced or is available
to commence and raw Land for which development has not commenced or is not
available to commence, all contemplated site development and Unit improvements.
In addition to the appraisal required by Bank prior to closing of the Loan,
19
updated appraisals shall be prepared at Borrower's expense when requested by
Bank but in no event more than annually, if Bank believes, in its sole
discretion, that the value of the collateral for the Loan would render the
Loan-to-value to less than seventy five percent (75%) as defined above. Borrower
shall cooperate fully with the appraisal process and shall allow the appraisers
reasonable access to the Approved Project.
7.21 LEASES AFFECTING APPROVED PROJECT. Borrower shall not, without
the express prior written consent of Bank, enter into any lease affecting the
Approved Project or any part thereof.
7.22 ASSIGNMENT OF CONTRACTS. As additional security for the Loan and
for the performance by Borrower of all of its obligations hereunder, Borrower
hereby assigns to Bank all of Borrower's interest in any and all contracts,
agreements, permits, licenses, approvals, or other documents or writings
relating to the construction, leasing, management or operation of the
Improvements, including but not limited to the Construction Documents, the
architect's contract, the engineer's contract, site development contractor's and
the Plans. This assignment shall not, however, be deemed to impose upon Bank any
of Borrower's obligations under any such contract. Incident to the assignment of
the Construction Documents, the architect's contract, site development
contractor's contract, the engineer's contract, and the Plans, Borrower will
fulfill the obligations of Borrower thereunder, enforce the performance thereof
and give immediate notice to Bank of any default by the architect, site
development contractor, the engineer, or the General Contractor thereunder.
Further, Borrower will not, without the prior written consent of Bank (i)
materially modify, or amend the terms of the architect's contract, the Plans,
engineer's contract, site development contractor's contract or the Construction
Documents; or (ii) waive or release the performance of any material obligation
to be performed by the architect, the engineer, site development contractor or
the General Contractor thereunder.
7.23 SUBORDINATE FINANCING. Borrower shall not permit there to exist
nor shall Borrower obtain any subordinate or secondary financing of the Land or
any other property granted as security for the Loan, except for that certain
loan in favor of Amresco Funding Corporation, a Delaware corporation, which loan
is secured by that certain mortgage dated March 29, 1996 and recorded in
Official Records Book 24694 at Page 0744 of the Public Records of Broward
County, Florida and that certain contingent return mortgage dated March 29, 1996
and received in Official Records Book 24694 at Page 0787 of the Public Records
of Broward County, Florida, both of which have been voluntarily subordinated to
Bank's mortgages.
7.24 TRANSFER OF PROPERTY OF BORROWER. The Borrower shall not permit
any change in its ownership (or the ownership of its general partners, if
applicable), its corporate or trade name, the nature and operation of its
business or the nature and character of the Borrower or the Approved Project,
nor shall the Borrower sell, assign, transfer, hypothecate or dispose of all or
any portion of the Land, Improvements, or the Approved Project, except as may be
permitted hereby, without the prior written consent of Bank, which consent shall
be withheld or granted in Bank's sole and absolute discretion.
7.25 PARTIAL RELEASES OF PROPERTY. Provided the Borrower is not then
in Default hereunder, under the Note, the Mortgage or any other Loan Document,
Bank will provide partial releases in respect of its interest under the Mortgage
and other Loan Documents upon the terms and conditions set out in Exhibit "B"
attached. Payments made for releases shall be applied by Bank against the
outstanding principal of the Loan unless the release payment is calculated to
take into account allocable interest or other constituent costs or accruals, in
which event Bank may apply the release payment in accordance with such
calculations. Borrower agrees to reimburse Bank for all out-of-pocket fees and
costs, as set forth in Exhibit "B" hereto in connection with the granting of
such partial releases and shall provide Bank with any and all information
requested by Bank with respect to the Unit to be released.
Notwithstanding anything contained herein to the contrary, if
Borrower applies for the partial release of a lot from the lien of the Mortgage
and other Loan Documents and there is not then any outstanding principal balance
under the A&D Note, but there are outstanding letters of credit (either drawn or
undrawn upon) issued by Bank on Borrower's behalf which are secured by the
Mortgage (the "Secured Letters of Credit"), the Lot
20
Release Price (computed in a redefined manner as follows: that certain amount
derived by dividing the sum of all remaining outstanding letters of credit by
the number of remaining developed lots encumbered by the Mortgage) shall
nevertheless be due and payable as a precondition to Bank's obligation to grant
a partial release or permit the commencement of a Unit on a particular lot, as
applicable, and the Lot Release Prices paid for partial releases in this
situation (collectively, the "Partial Release Funds") shall be placed by Bank in
an account in Borrower's name, which account shall be pledged by Borrower to
Bank as additional collateral for the Loan and the indebtedness of Borrower to
Bank arising out of the Secured Letters of Credit. Borrower shall have no rights
to make withdrawals or otherwise receive disbursements from the pledged account.
Borrower agrees to execute any and all documents required by Bank to evidence
the pledge of the Partial Release Funds. If the Secured Letters of Credit are
drawn, or if Borrower Defaults under the Loan Documents, Bank may, in its sole
and absolute discretion, and in addition to any and all of its available rights
and remedies under the Loan Documents, the documents evidencing the Secured
Letters of Credit, or otherwise, apply the Partial Release Funds to reimburse
Bank for any drawings made under the Secured Letters of Credit and to any then
outstanding balance under the Loan. If said Secured Letters of Credit are
reduced or released, the pledged account will be reduced or released as well and
shall be returned to Borrower.
Notwithstanding any provision herein to the contrary, if Bank at
its sole discretion has agreed to issue letters of credit for the performance of
site development work contemplated in this Agreement, sufficient availability
for funding such scope of work must exist under the Use of Proceeds for which
the letter of credit is being requested.
7.26 DISCLOSURE OF CONTRACTS AND NOTE. Borrower shall disclose to Bank
upon demand, the names of all persons with whom Borrower has contracted or
intends to contract for any construction or for the furnishing of labor or
materials therefor, and when required by Bank obtain the approval by Bank of all
such persons. Borrower shall upon Bank's request, at all times during the
construction period of any Improvements, provide to the Bank, within ten (10)
days of the Borrower's receipt thereof, copies of all notices to owner, claims
of lien, and demands for sworn statement of account, issued by any party,
whether pursuant to any notice of commencement or otherwise, in connection with
the Approved Project or the Land.
7.27 CONSTRUCTION LIEN LAW NOTIFICATION REQUIREMENTS. Borrower hereby
authorizes Bank to provide written notices to Contractor and lienors providing
notices to owner pursuant to ss.713.3471 (1)(a), Fla. Stat., and ss.713.3471
(2)(b), Fla. Stat., to the extent such notices are required by law. Borrower
hereby releases Bank and waives all claims it may have against Bank for damages
Borrower may incur as a result of Bank's failure to deliver said notices.
Borrower hereby agrees to provide all required notices to the Contractor and all
lienors providing notices to owner in compliance with ss.713.3471(2)(a), Fla.
Stat., in a timely fashion.
7.28 AMENDMENTS TO COST BREAKDOWN. If Borrower amends the Cost
Breakdown or reallocate items in the Cost Breakdown such that written notice to
the Contractor and lienors serving notices to owner would be required under
ss.713.3471(2)(a), Fla. Stat., (1992), Borrower agrees to provide written notice
to the Contractor and all required lienors in compliance with ss.713.3471
(2)(a), Fla. Stat., Bank shall not be obligated to make any disbursements of
Loan proceeds until Borrower has provided Bank with copies of any required
notices to the Contractor and required lienors in compliance with ss.713.3471
(2)(a), Fla. Stat., together with evidence that such notices have been
countersigned by the Contractor and all lienors who are required to receive the
notice under ss.713.3471 (2)(a), Fla. Stat., thereby confirming receipt thereof.
7.29 AMENDMENT TO THE USE OF PROCEEDS. With the written authorization
of Borrower or Borrower's authorized representative only, as evidenced by
Borrower's Draw Request, Bank may amend the Use of Proceeds or reallocate funds
designated for specific line items to other line items. Such amendment may be
evidenced by Borrower's Draw Request or by an Amended Use of Proceeds Schedule
and may be made without the consent of the Guarantors. Bank shall not be
permitted to reallocate items in the Use of Proceeds without the Borrower's or
Borrower's authorized representatives prior written consent.
21
7.30 LOAN FEES. INTENTIONALLY OMITTED.
7.31 MINIMUM A&D NOTE REPAYMENT SCHEDULE. INTENTIONALLY OMITTED
7.32 AMERICANS WITH DISABILITIES ACT. Borrower covenants and agrees
that, during the term of the Loan, to the extent such Act is applicable, the
Improvements and Approved Project will be in full compliance with the Americans
with Disabilities Act ("ADA") of July 26, 1990, 42 U.S.C Section 12191, et.
seq.) as amended from time to time, and the regulations promulgated pursuant
thereto. Borrower shall be solely responsible for all ADA compliance costs,
including without limitation, attorneys' fees and litigation costs, solely
relating to such period in which Borrower is the owner of the Land which
responsibility shall survive the repayment of the Loan and foreclosure of the
Land and Improvements.
7.33 REGULATION "Z". The Loan is exempt from the provisions of the
Federal Consumers Credit Protection Act (Truth-in-Lending Act) and Regulation
"Z" of the Board of Governors of the Federal Reserve System, because Borrower is
a person fully excluded therefrom, and/or because the Loan is only for business
or commercial purposes of Borrower and the proceeds of the Loan are not being
used for personal, household, family or agricultural purposes.
7.34 FINANCIAL COVENANTS. Borrower shall at all times be prohibited
from incurring or providing a guaranty for any additional debt, except trade
accounts payable in the ordinary course of business relative to the Approved
Project, or form pledging its assets to secure or guarantee any debt other than
that of the Borrower.
7.35 SUBORDINATION OF SHAREHOLDER LOANS. Borrower hereby subordinates,
to the prior payment to Bank of all sums owing under the Loan, any and all
loans, advances, and indebtedness owing from Borrower to shareholders of
Borrower from time to time, whether or not evidenced by promissory notes.
Borrower may make payments of principal and interest for any loan owing to its
shareholders until the Loan is paid in full so long as no Default exists under
the Loan.
ARTICLE VIII
REPRESENTATIONS AND WARRANTIES
8.1 REPRESENTATIONS AND WARRANTIES. Borrower hereby represents and
warrants to Bank that:
(a) REPRESENTATIONS AND WARRANTIES IN MORTGAGE AND GUARANTY. All
of the representations and warranties contained in the Mortgage and
Guaranty are true and correct and are incorporated herein by reference
as if set out in full.
(b) OTHER FINANCING. The Borrower has not (i) received any other
financing for the acquisition of or development and construction on
the Land existing as of the date hereof for which a lien equal to or
superior to Bank's mortgage could be successfully asserted, or (ii)
received any other financing for the construction of the Improvements,
except for financing in favor of Amresco Funding Corporation, a
Delaware corporation's interest, as evidenced by that certain
Mortgage, Assignment of Rents, and Security Agreement, dated March 29,
1996, and recorded April 3, 1996 in Official Records Book 24694 at
Page 0744, of the Public Records of Broward County, Florida (the
"Amresco Third Mortgage") and that certain Contingent Mortgage,
Assignment of Rents and Security Agreement, dated March 29, 1996 and
recorded April 3, 1996, in Official Records Book 24694 at Page 0787,
of the Public Records of Broward County, Florida, (the "Amresco Fourth
Mortgage") the Bank's Mortgage.
(c) PLANS. The Plans have been or will be prior to use approved
by the Borrower, the Guarantor, and each appropriate Governmental
Authority.
22
(d) GOVERNMENTAL REQUIREMENTS AND OTHER REQUIREMENTS. Borrower
will cause the Land to be developed and the Units to be xxxxxxxxxxx.xx
accordance with the Plans submitted to and approved by Bank, and when
so constructed the Land and the Units do and shall comply with all
covenants, conditions and restrictions affecting the Land or any
portion thereof, and do and shall comply with all Governmental
Requirements.
(e) USE OF THE APPROVED PROJECT. There is no (i) plan, study or
effort by any Governmental Authority or any nongovernmental person or
agency which may adversely affect the current or planned use of the
Approved Project, or (ii) to the best of Borrower's knowledge any
intended or proposed Governmental Requirement (including, but not
limited to, zoning changes) which may adversely affect the current or
planned use of the Approved Project.
(f) MORATORIUM. There is no moratorium or like governmental order
or restriction now in effect with respect to the Approved Project and,
to the best of Borrower's knowledge, no moratorium or similar
ordinance or restriction is now contemplated.
(g) PERMITS. All permits, approvals and consents of Governmental
Authorities and public and private utilities having jurisdiction
necessary in connection with the Approved Project have been or will be
issued and are or will be in good standing.
(h) CONDITION OF APPROVED PROJECT. No defect or condition of the
Land or the solid or geology thereof exists which will impair the
construction, use, or the operation of the Approved Project for its
intended purpose.
(i) LABOR AND MATERIALS. All labor and materials contracted for
in connection with the construction of the Improvements shall be used
and employed solely on the Land in said construction and only in
accordance with the Plans.
(j) SURVEYS. The Survey, the preliminary plat for the Land, and
all plot plans and other documents heretofore furnished by the
Borrower to Bank with respect to the Land and Improvements are
accurate and complete as of their respective dates. There are no
encroachments onto the Land and no improvements on the Land encroach
onto any adjoining property.
(k) CONSTRUCTION COSTS. The amount of the hard costs and soft
costs are accurate, true and correct and are satisfactory to Borrower.
(l) SALE OF SECURITIES. The Borrower has not instituted, caused
to be instituted or been a party to and, to the best of Borrower's
knowledge, there has not been any public offering with respect to the
Land and Improvements, or either, within the meaning of the Securities
Act of 1933 and the Securities Exchange Act of 1934.
(m) CONSTRUCTION LIEN LAW. At the time of Closing and at the time
of the recording of the Mortgage, no work has been done on
Improvements or on the Approved Project by the Borrower or anyone else
acting for, or on behalf of the Borrower, and no materials have been
placed on the Property by any materialmen or by anyone else. No Notice
of Commencement has been recorded in the Public Records with respect
to the Approved Project or the Land at the time of Closing. Borrower
shall not permit the commencement of any excavation or construction
work of any nature whatsoever, nor the delivery of any materials to
the Approved Project or the Land, prior to the recordation and posting
of a Notice of Commencement as hereinafter set forth. Borrower shall
execute an appropriate Notice of Commencement and cause the same to be
recorded in the public records of the county in which the Property is
located in sequence after the recording of the Mortgage. Borrower
shall post a certified copy
23
of the Notice of Commencement on the Approved Project, in strict
conformity with the Florida Construction Lien Law. If construction is
commenced prior to the recordation and posting of the Notice of
Commencement, or the Notice of Commencement is recorded prior to the
Mortgage, Bank shall have the absolute right to cancel this Agreement
and be immediately reimbursed by Borrower for all disbursements of
loan proceeds, together with expenses and reasonable attorneys' fees
incurred in, connection therewith. Construction shall commence within
ninety (90) days after recordation of the Notice of Commencement.
Construction shall proceed continuously in a workmanlike manner. Bank
reserves the right to require Borrower to furnish an itemized cost
breakdown for the Improvements to be constructed.
(n) REPRESENTATIONS AND WARRANTIES IN OTHER LOAN DOCUMENTS. All
of the representations and warranties contained in the other Loan
Documents are true and correct.
8.2 RELIANCE ON REPRESENTATIONS. The Borrower acknowledges that Bank
has relied upon the Borrower's representations and is not charged with any
knowledge contrary thereto that may be received by an examination of the public
records wherein the Land is located or that may have been received by any
officer, director, agent, employee or shareholder of Bank.
8.3 CERTIFICATE REGARDING LOAN STATUS. Upon Bank's request, Borrower
and Guarantors shall provide Bank with a written certification, certifying to
such matters related to the Loan as Bank may request, including, but not limited
to, a statement that Borrower and Guarantors are not in Default and that no
Default Conditions have occurred.
ARTICLE IX
EVENTS OF DEFAULT
9.1 DEFAULT. The occurrence of any one. or more of the following
events (time being of the essence as to this Loan Agreement and all of its
provisions) constitutes a "Default" by Borrower under this Loan Agreement, and
at the option of Bank, under the other Loan Documents:
(a) SCHEDULED PAYMENT. Borrower's failure to make any payment
required under the Note when due or within any applicable grace
period.
(b) MONETARY DEFAULT. Borrower's failure to make any other
payment required by this Loan Agreement or the other Loan Documents
when due or within any applicable grace period.
(c) OTHER. Borrower's failure to perform any other obligation
imposed upon Borrower by this Loan Agreement or any other Loan
Document within thirty (30) days after the date when performance is
due. This provision shall not be construed to provide Borrower with
any grace period in complying with any obligations imposed on Borrower
by the terms of the Loan Documents. Notwithstanding the foregoing
provision, Bank shall give Borrower notice, as defined in the
Mortgage, of any non-monetary default after which Borrower shall have
a thirty (30) day cure period.
(d) REPRESENTATION. Any representation or warranty of Borrower
contained in this Loan Agreement or in any certificate delivered
pursuant hereto, or in any other instrument or statement furnished in
connection herewith, proves to be incorrect or misleading in any
adverse respect as of the time when the same shall have been made,
including, without limitation, any and all financial statements,
operating statements, and schedules attached thereto, furnished by
Borrower or any guarantor of the Loan to Bank or pursuant to any
provision of this Loan Agreement,
24
(e) BANKRUPTCY. Borrower or any general partner of Borrower or
any guarantor of the Loan (i) files a voluntary petition in bankruptcy
or a petition or answer seeking or acquiescing in any reorganization
or for an arrangement,, composition, readjustment, liquidation,
dissolution, or similar relief for itself pursuant to the United State
Bankruptcy Code or any similar law or regulation, federal or state,
relating to any relief for debtors, now or hereafter in effect; or
(ii) makes an assignment for the benefit of creditors or admits in
writing its inability to pay or fails to pay its debts as they become
due; or (iii) suspends payment of its obligations or takes any action
in furtherance of the foregoing; or (iv) consents to or acquiesces in
the appointment of a receiver, trustee, custodian, conservator,
liquidator or other similar official of Borrower, a general partner of
Borrower, or any guarantor, for all or any part of the Collateral or
other assets of such party, or either; or (v) has filed against it an
involuntary petition, arrangement, composition, readjustment,
liquidation, dissolution, or an answer proposing an adjudication of it
as a bankrupt or insolvent, or is subject to reorganization pursuant
to the United States Bankruptcy Code, an action seeking to appoint a
trustee, receiver, custodian, or conservator or liquidator, or any.
similar law, federal or state, now or hereinafter in effect, and such
action is approved by any court of competent jurisdiction and the
order approving the same shall not be vacated or stayed within sixty
(60) days from entry; or (vi) consents to the filing of any such
petition or answer, or shall fail to deny the material allegations of
the same in a timely manner.
(f) JUDGMENTS. (1) A final judgment other than a final judgment
in connection with any condemnation is entered against Borrower,
Guarantors, or any general partner of Borrower, that (i) adversely
affects the value, use or operation of the Land or the Improvements in
Bank's sole judgment, or (ii) adversely affects, or may adversely
affect, the validity, enforceability or priority of the lien or
security interest created by the Mortgage or any other Loan Document
in Bank's sole judgment, or both; or (2) execution or other final
process issues thereon with respect to the Land or the Improvements;
and (3) Borrower, Guarantor, or any general partner of Borrower, does
not discharge the same or provide for its discharge in accordance with
its terms, or procure a stay of execution thereon, in any event within
thirty (30) days from entry, or Borrower shall not, within such period
or such longer period during which execution on such judgment shall
have been entered, and cause its execution to be stayed during such
appeal, or if on appeal such order, decree or process shall be
affirmed and Borrower shall not discharge such judgment or provide for
its discharge in accordance with its terms within sixty (60) days
after the entry of such order or decree or affirmance, or if any stay
of execution on appeal is released or otherwise discharged.
(g) LIENS. Any federal, state or local tax lien or any claim of
lien for labor or materials or any other lien or encumbrance of any
nature whatsoever is recorded against Borrower or the Land or
Improvements and is not removed by payment or transferred to
substitute security in the manner provided by law, within thirty (30)
days after it is recorded in accordance with applicable law.
(h) OTHER NOTES OR MORTGAGES. Borrower's default in the
performance or payment of Borrower's obligations under any other note
which remains uncured after any applicable grace period, or under any
other mortgage encumbering all or any part of the Land or the
Improvements, if the other mortgage is permitted by the Bank, whether
such other note or mortgage is held by Bank or by any other party, and
unless otherwise agreed to by separate written agreement between Bank
and such other mortgage holder.
(i) BORROWER DEFAULT UNDER LOAN DOCUMENTS. Borrower's default in
the payment or performance of any of Borrower obligations under any of
the Loan Documents, including this Loan Agreement and any riders
thereto.
(j) GUARANTOR DEFAULT.
25
i) The default after expiration of any applicable grace
period in the payment or performance of any obligation of a
Guarantor of the Note arising under its guaranty or pursuant to
any other Loan Documents; or
ii) The death of any Guarantor and the failure of Borrower
to provide Bank with an alternate guaranty or alternate
collateral satisfactory to Bank in its sole and absolute
discretion within sixty (60) days of the date of Guarantor's
death.
(k) BORROWERS/GENERAL PARTNER'S CONTINUED EXISTENCE. Borrower or
any corporate General Partner of Borrower shall cease to exist or to
be qualified to do or transact business in the State in which the Land
and Improvements are located, or shall be dissolved or shall be a
party to a merger or consolidation, or shall sell all or substantially
all of its assets, or shall change its corporate name or trade name
without prior written notice to Bank.
(l) STOCK IN BORROWER/CHANGE IN PARTNERS. If Borrower is a
limited partnership and without the prior written consent of Bank, any
shares of stock of any corporate general partner of Borrower are
issued, sold, transferred, conveyed, assigned, mortgaged, pledged, or
otherwise disposed of so as to result in change of control of
Borrower, whether voluntarily or by operation of law, and whether with
or without consideration, or any agreement for any of the foregoing is
entered into; or, if any general partnership interest or other equity
interest in the Borrower is sold, transferred, assigned, conveyed,
mortgaged, pledged, or otherwise disposed of, whether voluntarily or
by operation of law, and whether with or without consideration, or any
agreement for any of the foregoing is entered into, or any general
partner of Borrower withdraws from the partnership.
(m) TRANSFER OF PROPERTY OR OWNERSHIP. Any sale, conveyance,
transfer, assignment, or other disposition or encumbrance of all or
any part of the Land, Improvements, or the Approved Project, or any
ownership interest in Borrower or any guarantor without the prior
consent of Bank or except as otherwise permitted hereby, or as
outlined in the prospectus for public offering for Transeastern
Properties, Inc., a Florida corporation delivered to Bank by Borrower.
(n) FALSE STATEMENT. Any statement or representation of Borrower
or any guarantor contained in the loan application or any financial
statements or other materials furnished to Bank or any other Bank
prior or subsequent to the making of the Loan secured hereby are
discovered to have been false or incorrect or incomplete.
(o) DEFAULT UNDER INDEMNITY. Borrower or Guarantor shall default
after any applicable grace period under any obligation imposed by any
indemnity contained within any of the Loan Documents including the
Hazardous Waste Certification and Indemnification.
(p) CROSS-DEFAULT. Any monetary default by the Borrower or
Guarantor under this Loan shall be a default under all other
documents, instruments, mortgages and other collateral documents
evidencing and securing all other loans by Bank to Borrower or
Guarantor.
(q) NON-COMPLIANCE WITH THE PLANS AND SPECIFICATIONS. Failure of
any of the materials supplied for the development of the Land or the
construction of the Units to comply with the Plans and Specifications
or any requirements of any Governmental Authority unless the Borrower
undertakes and diligently pursues the correction of such failure.
(r) PROJECTED COMPLETION OF CONSTRUCTION. Failure to construct
the Improvements with reasonable dispatch, or the discontinuance of
construction at any time for a period of fifteen (15) days
consecutively, or determination by Bank that construction of the
Improvements will not be timely completed
26
and Borrower's failure to complete, cure or provide satisfactory
assurances after notice or demand from Bank. Notwithstanding the
foregoing, any delays in the event of unavailability of materials at
reasonable cost, strikes, other labor problems, governmental orders,
acts of God or other events which would support a defense based upon
impossibility of performance for reasons beyond the control of
Borrower shall not be a Default under this paragraph.
(s) NON-PAYMENT OF DEBTS. Borrower is generally not paying its
debts as such debts become due.
(t) SECURITIES LAWS VIOLATION. The assertion of any violation of
the 1933 Securities Act, 1934 Securities Act or the Florida Blue Sky
Laws by any Governmental Authorities or the institution of any
securities litigation not dismissed within sixty (60) days of the
commencement of same.
(u) NON-COMPLIANCE WITH HOMEOWNER ASSOCIATION DOCUMENTS. Borrower
shall fail to perform any duty required of it, fulfill any condition,
abide by any covenant or in any manner default under the homeowners,
association documents encumbering the Approved Project, if any.
(v) ADVERSE ACTIONS. Any legal or equitable action is commenced
against Borrower which, if adversely determined, could reasonably be
expected to impair substantially the ability of Borrower to perform
each and every obligation under the Loan Documents and this Agreement;
provided, however, if Borrower has commenced a counter action, contest
or defense to the adverse action and resolved such adverse action
within one hundred twenty (120) days of the commencement of same then
Borrower shall not be in Default.
(w) GOVERNMENT CHALLENGES. The validity of any permit, approval
or consent by any Governmental Authority relating to the Land, the
Improvements, or the Approved Project, or the operation thereof is
challenged by a proceeding before a board, commission, agency, court
or other authority having jurisdiction; provided, however, if Borrower
has commenced a counter action, contest or defense to the governmental
challenge and resolved such challenge within one hundred twenty (120)
days of the commencement of same then Borrower shall not be in
Default.
(x) BORROWER'S ACTIONS. Any action by the Borrower, which would,
in the sole opinion of the Bank, significantly endanger the security
of the Loan and which Borrower fails to mitigate after notice from
Bank will render the Loan payable on demand.
(y) MISCELLANEOUS. If at any time the Bank shall determine that
there has been a material adverse change in the financial condition or
prospects of Borrower, the Guarantor, or any general partner of
Borrower, which is not corrected or cured after reasonable notice from
Bank.
ARTICLE X
BANK'S RIGHTS AND REMEDIES
The following rights and remedies are available to Bank:
10.1 ACCELERATION. Upon the occurrence of a Default, the entire unpaid
principal balance of the Loan and all accrued but unpaid interest thereon and
any costs or expenses then due to Bank and any and all other obligations of
Borrower to Bank, shall, at the option of Bank and without notice to Borrower,
become immediately due and payable.
10.2 COMPLETION OF CONSTRUCTION. From and after the occurrence of a
Default, Bank shall be entitled to have and use the Plans And the Construction
Documents and, after first having given written notice to the
27
architect, site development contractor, the engineer, or the General Contractor,
shall be entitled from and after such notice to enjoy and enforce all of the
rights of Borrower under the architect's contract, engineer's contract, site
development contractor's contract, the Plans or the Construction Contracts.
Borrower hereby irrevocably constitutes and appoints Bank its true and lawful
attorney-in-fact with full power of substitution in the Approved Project to
complete the Improvements in the name of Borrower following a Default. Borrower
hereby empowers Bank from and after Default as its attorney-in-fact as follows:
(a) to use any funds of Borrower, including any Loan proceeds or equity deposits
which may remain undisbursed hereunder, for the purpose of completing the
Improvements in accordance with the Plans; (b) to make such additions, changes,
modifications, or corrections in, or deviations from, the Plans as shall be
necessary or desirable to complete the Improvements; (c) to employ such
contractors, subcontractors, agents, architects, engineers, inspectors, or other
parties as shall be required for said purposes; (d) to pay, settle, or
compromise all existing bills and claims which may be liens against the
Improvements or as xxx.xx necessary or desirable in the sole discretion of Bank
for the completion of the Improvements or for clearance of title; (e) to direct
use of and/or use all or any part of the labor, materials, supplies and
equipment contracted for, owned by, or under the control of Borrower, whether or
not previously incorporated into the Improvements; (f) to execute all
applications and certificates in the name of Borrower which may be required by
the Construction Documents, the architect's contract, the engineer's contract,
site development contractor's contract, Plans, or any of the contract documents;
(g) to prosecute and defend all actions or proceedings in connection with the
Approved Project or the construction of the Improvements and take such action
and require such performance as Bank shall deem necessary under any performance
or payment bond; and (h) to do any and every act with respect to construction or
completion of the Improvements or the closing of any permanent financing which
Borrower might do in its own behalf including, without limitation, execution,
acknowledgment, and delivery of all instruments, documents, and papers in the
name of Borrower as may be necessary or desirable in the sole discretion of
Bank. It is further understood and agreed that this power of attorney which
shall be deemed to be a power coupled with an interest, cannot be revoked. All
sums expended by Bank pursuant hereto shall be deemed to have been disbursed to
Borrower and secured by the Security Documents, and the other Loan Documents.
10.3 DISPUTES. Where disputes have arisen which, in the opinion of
Bank, may endanger timely completion of the Improvements or fulfillment of any
condition or covenant herein, Bank may agree to disburse Loan proceeds for the
account of Borrower without prejudice to Borrower's rights, if any, to recover
said proceeds from the party to whom paid. Such agreement or agreements may take
the form which Bank in its discretion deems proper, including, but without
limiting the generality of the foregoing, agreements to indemnify (on behalf of
Borrower and/or for Bank's own account) any title insurer against possible
assertion of lien claims, agreements to pay disputed amounts and the like. All
sums paid or agreed to be paid pursuant to such undertaking shall be advances of
Loan proceeds.
10.4 REMEDIES CUMULATIVE: NONWAIVER: JUDGMENTS. All remedies of Bank
provided for herein or in the other Loan Documents are cumulative and shall be
in addition to any and all other rights and remedies provided for or available
under the other Loan Documents, at law or in equity. The exercise of any right
or remedy by Bank hereunder shall not in any way constitute a cure or waiver of
a Default Condition or a Default hereunder or under the Loan Documents, or
invalidate any act done pursuant to any notice of the occurrence of a Default
Condition or Default, or prejudice Bank in the exercise of any of its rights
hereunder or under any of the other Loan Documents, unless, in the exercise of
said rights, Bank realizes all amounts owed to it under the Loan Documents. ANY
JUDGMENT IN FAVOR OF BANK AGAINST BORROWER SHALL BEAR INTEREST AT THE DEFAULT
RATE (AS DEFINED IN THE NOTE).
10.5 NO LIABILITY OF BANK. Whether or not Bank elects to employ any or
all remedies available to it in the event of an occurrence of a Default
Condition or Default, Bank shall not be liable for the construction of or
failure to construct or complete or protect the Improvements or for payment of
any expense incurred in connection with the exercise or any remedy available to
Bank or for the construction or Completion of the Improvements or for the
performance or nonperformance of any other obligation of Borrower.
28
10.6 SECURITY INTEREST. It is understood and agreed that Bank shall
have and enjoy and is hereby granted a lien on, and a security interest in, all
collateral described in the Mortgage, and including without limitation, any and
all materials (stored on-site or off-site), reserves, deferred payments,
deposits or advance PAYments for materials (stored on-site or off-site)
undisbursed Loan proceeds, insurance refunds, impound accounts, refunds for
overpayment of any kind, and such lien and security interest shall constitute
additional security for the Indebtedness of Borrower to Bank, and Bank shall
have and possess any and all rights and remedies of a secured party provided by
law with respect to enforcement of and recovery on its security interest on such
items and amounts. In the event of a conflict between this paragraph and any
security interest granted pursuant to the Mortgage, the Mortgage shall control.
10.7 CESSATION OF FUNDING. Upon the occurrence of a Default, Bank
shall have the right to immediately terminate further funding of the Loan
irrespective of the stage of completion.
ARTICLE XI
GENERAL CONDITIONS
The following conditions shall be applicable throughout the term of
this Loan Agreement:
11.1 WAIVERS. No waiver of any Default Condition or Default or breach
by Borrower hereunder shall be implied from any delay or omission by Bank to
take action on account of such Default Condition or Default, and no express
waiver shall affect any Default Condition or Default other than the Default
specified in the waiver and it shall be operative only for the time and to the
extent therein stated. Waivers of any covenants, terms or conditions
contained herein must be in writing and shall not be construed as a waiver of
any subsequent breach of the same covenant, term or condition. The consent or
approval by Bank to or of any act by Borrower requiring further consent or
approval shall not be deemed to waive or render unnecessary the consent or
approval to or of any subsequent or similar act. No single or partial exercise
of any right or remedy of Bank hereunder shall preclude any further exercise
thereof or the exercise of any other or different right or remedy.
11.2 BENEFIT. This Loan Agreement is made and entered into for the
sole protection and benefit of Bank and Borrower, their successors and assigns,
and no other person or persons have any right to action hereon or rights to the
Loan all proceeds at any time, nor shall Bank owe any duty whatsoever to any
claimant for labor or services performed or material furnished in connection
with the Approved Project, or to apply any undisbursed portion of the Loan to
the payment of any such claim, or to exercise any right or power of Bank
hereunder or arising from any Default Condition or Default by Borrower.
11.3 ASSIGNMENT. The terms hereof shall be binding upon and inure to
the benefit of the heirs, successors, assigns, and personal representatives of
the parties hereto; provided, however, that Borrower shall not assign this Loan
Agreement or any of its rights, interests, duties or obligations hereunder or
any Loan proceeds or other moneys to be advanced hereunder in whole or in part
without the prior written consent of Bank and that any such assignment (whether
voluntary or by operation of law) without said consent shall be void. It is
expressly recognized and agreed that Bank may assign this Loan Agreement, the
Note, the Security Documents, and any other Loan Documents, in whole or in part,
to any other person, firm, or legal entity provided that all of the provisions
hereof shall continue in full force and effect and, in the event of such
assignment, Bank shall thereafter be relieved of all liability under the Loan
Documents and any Loan disbursements made by any assignee shall be deemed made
in pursuant and not in modification hereof and shall be evidenced by the Note
and secured by the Security Documents and any other Loan Documents.
29
11.4 AMENDMENTS. This Loan Agreement shall not be amended except by a
written instrument signed by all parties hereto.
11.5 TERMS. Whenever the context and construction so require, all
words used in the singular number herein shall be deemed to have been used in
the plural, and vice versa, and the masculine gender shall include the feminine
and neuter and the neuter shall include the masculine and feminine.
11.6 GOVERNING LAW AND JURISDICTION. This Loan Agreement and the other
Loan Documents and all matters relating thereto shall be governed by and
construed and interpreted in accordance with the laws of the State of Florida.
Borrower and all of its general partners hereby submits to the jurisdiction of
the state and federal courts located in Florida and agree that Bank may, at its
option, enforce its rights under the Loan Documents in such courts.
11.7 PUBLICITY. At Bank's request and expense, and subject to
applicable laws, regulations and restrictions, Borrower shall place upon the
Approved Project, at a location mutually acceptable to Borrower and Bank, a sign
or signs advertising the fact that financing is being provided by Bank. Bank
shall also have the right to secure printed publicity through newspaper and
other media concerning the Approved Project and source of financing.
11.8 SAVINGS CLAUSE. Invalidation of any one or more of the provisions
of this Loan Agreement shall in no way affect any of the other provisions
hereof, which shall remain in full force and effect.
11.9 EXECUTION IN COUNTERPARTS. This Loan Agreement may be executed in
two or more counterparts, each of which shall be deemed to be an original, but
all of which shall constitute one and the same instrument, and in making proof
of this Loan Agreement, it shall not be necessary to produce or account for more
than one such counterpart.
11.10 CAPTIONS. The captions herein are inserted only as a matter of
convenience and for reference and in no way define, limit or describe the scope
of this Loan Agreement nor the intent of any provision hereof.
11.11 NOTICES. All notices required to be given hereunder shall be
given in accordance with the requirements of the Mortgage.
11.12 MANDATORY ARBITRATION. Any controversy or claim between or among
the parties hereto including but not limited to those arising out of or relating
to this Loan Agreement or any related agreements or instruments, including any
claim based on or arising from an alleged tort, shall be determined by binding
arbitration in accordance with the Federal Arbitration Act (or if not
applicable, the applicable state law), the Rules of Practice and Procedure for
the Arbitration of Commercial Disputes of Judicial Arbitration and Mediation
Services, Inc. (J.A.M.S.), and the "Special Rules" set forth below. In the event
of any inconsistency, the Special Rules shall control. Judgment upon any
arbitration award may be entered in any court having jurisdiction. Any party to
this Loan Agreement may bring an action, including a summary or expedited
proceeding, to compel arbitration of any controversy or claim to which this Loan
Agreement applies in any court having jurisdiction over such action.
(a) SPECIAL RULES. The arbitration shall be conducted in the
County of Broward, Florida and administered by Endispute, Inc., d/b/a
J.A.M.S./Endispute who will appoint an arbitrator; if
J.A.M.S./Endispute is unable or legally precluded from administering
the arbitration, then the American Arbitration Association will serve.
All arbitration hearings will be commenced within 90 days of the
demand for arbitration; further, the arbitrator shall only, upon a
showing of cause, be permitted to extend the commencement of such
hearing for up to an additional 60 days.
30
(b) RESERVATION OF RIGHTS. Nothing in this Loan Agreement shall
be deemed to (i) limit the applicability of any otherwise applicable
statutes of limitation or repose and any waivers contained in this
Loan Agreement; or (ii) be a waiver by the Bank of the protection
afforded to it by 12 U.S.C. Sec. 91 or any substantially equivalent
state law; or (iii) limit the right of the Bank hereto (A) to exercise
self help remedies such as (but not limited to) setoff, or (B) to
foreclose against any real or personal property collateral, or (C) to
obtain from a court provisional or ancillary remedies such as (but not
limited to) injunctive relief or the appointment of a receiver. The
Bank may exercise such self help rights, foreclose upon such property,
or obtain such provisional or ancillary remedies before, during or
after the pendency of any arbitration proceeding brought pursuant to
this Agreement. At Bank's option, foreclosure under a deed of trust or
mortgage may be accomplished by any of the following: the exercise of
a power of sale under the deed of trust or mortgage, or by judicial
sale under the deed of trust or mortgage, or by judicial foreclosure.
Neither this exercise of self help remedies nor the institution or
maintenance of an action for foreclosure or provisional or ancillary
remedies shall constitute a waiver of the right of any party,
including the claimant in any such action, to arbitrate the merits of
the controversy or claim occasioning resort to such remedies.
11.13 DISBURSEMENT OF CONSTRUCTION LINE FUNDS AT RENEWAL. If, in
Bank's sole and absolute discretion, Bank agrees to extend the term of the
Construction Line, and the outstanding principal balance of the Construction
Line IS LESS than the original, principal Construction Line amount at the time
of the extension, then Bank may, in its sole and absolute discretion, but is not
obligated to, disburse sufficient Construction Line funds to increase the
outstanding principal balance of the Construction Line up the original,
principal amount of the Construction Line, provided that Borrower pledges to
Bank as additional security for the Construction Line liquid collateral in kind
and amount acceptable to Bank in its sole discretion and deposits the same in an
account with Bank. In connection with any such pledge of liquid collateral,
Borrower shall deliver to Bank any original securities or other instruments
evidencing the collateral and shall execute such security agreements,
assignments, powers-of-attorney, stock powers, endorsements, financing
statements or other documentation as Bank may require to establish and perfect
the security interest so granted by Borrower. Nothing contained herein shall
constitute Bank's agreement or commitment to renew the Construction Line.
IN WITNESS WHEREOF, Borrower and Bank have executed this Loan
Agreement as of the above written date.
Signed, sealed and delivered
in the presence of TRANSEASTERN PEMBROKE VILLAGES, INC.,
a Florida corporation
_____________________________________
Witness #1 By ____________________________(SEAL)
_____________________________________ Xxxxxx Xxxxxxx, Executive Vice
Print Name President
_____________________________________
Witness #2
_____________________________________
Print Name Address:
0000 Xxxxxxxxxx Xxxxx
Xxxxx Xxxxxxx, Xxxxxxx 00000
CHASE FEDERAL BANK, a Federal Savings
Bank, a Division of NATIONSBANK, N.A.
(SOUTH), a national banking
association
31
_____________________________________
Witness #1 By ____________________________(SEAL)
Xxxxx X. Xxxx, Real Estate Banking
_____________________________________ Officer
Print Name
_____________________________________
Witness #2 Address:
_____________________________________
Print Name 000 Xxxx Xxxxxxx Xxxxx Xxxx
Xxxxx 000
Xx. Xxxxxxxxxx, Xxxxxxx 00000
32
JOINDER OF GUARANTORS
The undersigned as Guarantor hereby joins in and consents to the
foregoing Loan Agreement.
_____________________________________
Witness #1
_____________________________________
Print Name
____________________________________
_____________________________________ Xxxxxx Xxxxxxx
Witness #2
_____________________________________
Print Name
_____________________________________
Witness #1
_____________________________________
Print Name
____________________________________
_____________________________________ Xxxxxx Xxxxxxx
Witness #2
_____________________________________
Print Name
_____________________________________
Witness #1
_____________________________________
Print Name
____________________________________
_____________________________________ Xxxxxx Xxxxx
Witness #2
_____________________________________
Print Name
_____________________________________ Transeastern Properties, Inc., a
Witness #1 Florida corporation, f/k/a
Transeastern Properties of South,
Inc., a Florida corporation
_____________________________________
Print Name
By_____________________________(SEAL)
_____________________________________ Xxxxxx Xxxxxxx, Executive Vice
Witness #2 President
_____________________________________
Print Name
33
EXHIBITS
1. Exhibit "A": Draw Sheets/Use of Proceeds
2. Exhibit "B": Partial Release
3. Exhibit "C": Intentionally Omitted
4. Exhibit "D": Percentage Completion Draw Schedule
5. Exhibit "E": Site Plans
6. Exhibit "F": Legal Description
34
EXHIBIT "A" - DRAW SHEETS/USE OF PROCEEDS
NATIONSBANK, N.A. (SOUTH)
ACQUISITION AND DEVELOPMENT LOAN
REQUEST FOR FUNDING
PAGE 1 OF 2
BORROWER: ___________________________________________________________
SUBDIVISION: ___________________________________________________________
UNIT: ___________________________________________________________
TOTAL LOAN AMOUNT (COL. D): $ _____________________
TOTAL WORK IN PLACE (COL. E): $ _____________________
LESS RETAINAGE (COL. F): $ _____________________
TOTAL COMPLETED LESS RETAINAGE: $______________________
LESS PREVIOUS REQUESTS FOR FUNDING: $ _____________________
CURRENT FUNDING REQUEST (COL. H): $ _____________________
The above request is in accordance with terms of the Loan Agreement dated
__________________, and is certified that: 9a) The improvements on the above
listed property have been completed and are in place in accordance with the
plans & specifications, as submitted to and approved by Lender; (b) There are no
unpaid bills for labor, taxes and/or material for which liens may be filed upon
the date of this request; (c) All requirements of governmental agencies have
been fully complied with.
BORROWER:
PAGE 2 OF 2
OBTAIN A COPY FROM BANK
EXHIBIT B
PARTIAL RELEASES
1. PARTIAL RELEASES UNDER THE CONSTRUCTION LINE. Provided that
Borrower is not then in Default hereunder, under the Construction Line, the
Mortgage or any other Loan Document, Bank will provide partial releases of Units
from the lien of the Mortgage upon the following terms:
(a) If the partial release relates to developed lots in
connection with a bona fide sale or construction loan on which no home
construction advances have been made:
(i) Bank shall be given written notice of the request for
each partial release at least five (5) business days prior to
each partial release.
(ii) The cost of each partial release shall be paid by
Borrower.
(iii) Contemporaneously with the delivery to Borrower of
each partial release, Borrower shall prepay principal in an
amount equal to the amount advanced upon such lot plus accrued
interest thereon.
(b) If the partial release relates to Units for which advances of
Construction Line proceeds have been made, Borrower shall prepay
principal of the Construction Line in an amount equivalent to the
total actual amount advanced by Bank under the Construction Line on
account of the Unit to be released, together with interest accrued
thereon ("Unit Release Price") and the applicable Lot Release Price.
EXHIBIT "C"
INTENTIONALLY OMITTED
ONE STORY DRAW SHEET
(OBTAIN FROM BANK)
TWO STORY DRAW SHEET
(OBTAIN FROM BANK)
EXHIBIT "E"
SITE PLANS
EXHIBIT "F"
LEGAL DESCRIPTION
Borrower's Taxpayer
Identification No: 00-0000000
THIS IS A CONSOLIDATED RENEWAL PROMISSORY NOTE
(THE "CONSOLIDATED NOTE") TO CONSOLIDATE THE INDEBTEDNESS
REPRESENTED BY THE PROMISSORY NOTE DATED MARCH 29, 1996
("FIRST NOTE") AND THE DEMAND NOTE OF EVEN DATE HEREWITH
("DEMAND NOTE"). THE ORIGINAL FIRST NOTE AND DEMAND NOTE
ARE ATTACHED TO THIS CONSOLIDATED NOTE. INTANGIBLE TAXES AND
DOCUMENTARY STAMPS ON THE FIRST NOTE HAVE BEEN
AFFIXED TO THE MORTGAGE AND SECURITY AGREEMENT SECURING
THE FIRST NOTE. INTANGIBLE TAXES AND DOCUMENTARY
STAMPS ON THE DEMAND NOTE HAVE BEEN PAID IN CONNECTION WITH
THE RECORDING OF THE AMENDED AND RESTATED REAL ESTATE XXXX-
XXXX, ASSIGNMENT AND SECURITY AGREEMENT SECURING THE
CONSOLIDATED NOTE.
CONSOLIDATED RENEWAL
PROMISSORY NOTE
$8,737,500.00 September ____, 0000
Xxxx Xxxxxxxxxx, Xxxxxxx
FOR VALUE RECEIVED, TRANSEASTERN PEMBROKE VILLAGES, INC., a Florida
corporation, (sometimes hereinafter referred to as the "undersigned" or the
"Borrower"), promises to pay to the order of CHASE FEDERAL BANK, A FEDERAL
SAVINGS BANK, A DIVISION OF NATIONSBANK, N.A. (SOUTH), a national banking
association, or any subsequent holder of this note ("Bank") at its principal
offices located at Suite 101, 000 Xxxx Xxxxxxx Xxxxx Xxxx, Xxxx Xxxxxxxxxx,
Xxxxxxx 00000, or such other place or places as Bank may designate) the
principal sum of EIGHT MILLION SEVEN HUNDRED THIRTY SEVEN THOUSAND FIVE HUNDRED
AND NO/100 DOLLARS ($8,737,500.00) or so much thereof as may be from time to
time outstanding, plus interest thereon at the Rate hereinafter defined, all in
accordance with the terms and conditions of this Promissory Note (the "Note")
and in accordance with the Loan Agreement by and between Borrower and Bank of
even date (the "Loan Agreement") . This Note is secured by a Real Estate
Mortgage, Assignment, and Security Agreement of even date filed or to be filed
for record in the public records of Broward County, Florida (the "Mortgage"),
Guaranty Agreements (the "Guaranty") of Transeastern Properties, Inc., a Florida
corporation, f/k/a Transeastern Properties of South Florida, Inc., a Florida
corporation, Xxxxxx Xxxxxxx, Xxxxxx Xxxxxxx and Xxxxxx Xxxxx (the "Guarantor"),
UCC Financing Statements of even date filed or to be filed for record in the
public records of Broward County, Florida, and in the Office of the Secretary of
State of the State of Florida (the "Financing Statements") , and other
agreements by and between Borrower and Bank. The
Mortgage, Guaranty, Financing Statements and such other agreements are
hereinafter referred to collectively as the "Security Documents" and the loan
evidenced thereby is hereinafter referred to as the "Loan." Terms used herein
but not otherwise defined hereunder are defined as set forth in the Security
Documents or the Loan Agreement. All of the terms, definitions, conditions and
covenants of the Security Documents or the Loan Agreement are expressly made a
part of this Note by reference in the same manner and with the same effect as if
set forth herein at length, and any holder of this Note is entitled to the
benefits of and remedies provided in the Security Documents or the Loan
Agreement.
A. PRIME RATE. For purposes hereof, "Prime Rate" means the fluctuating
rate of interest per annum established by Bank as its prime lending
rate in effect from time to time whether or not such rate shall be
otherwise published. Such Prime Rate is established by Bank as an
index or base rate and may or may not at any time be the best or
lowest rate of interest offered by Bank.
B. INTEREST. The outstanding Loan principal balance shall bear interest
at a variable rate per annum equal to the Prime Rate plus one (1.00%).
The interest rate hereunder shall be adjusted daily in accordance with
fluctuations in the Prime Rate. Interest shall be computed on the
basis of a daily amount of interest accruing on the daily outstanding
principal balance during a 360- day year multiplied by the actual
number of days the principal is outstanding during such applicable
interest period.
C. PAYMENT OF INTEREST. Interest accrued in accordance with this Note
shall be due and payable monthly, in arrears, on the FIRST day of each
month immediately following the calendar month for which said interest
has accrued. All accrued but unpaid interest and principal shall be
due and payable in full on the Maturity Date, as defined in Paragraph
6 below. All payments of principal and interest shall be made in
lawful currency of the United States of America which shall be legal
tender in payment of all debts, public and private, at the time of
payment.
D. PREPAYMENT. This Note may be prepaid in whole or in part at any time
without fee, premium or penalty. Any partial prepayment shall be
applied in accordance with paragraph 10 below and shall not postpone
the due date of any subsequent periodic installments or the Maturity
Date, or change the amount of such installments due, unless Bank shall
otherwise agree in writing.
E. LATE CHARGES. Should Borrower fail to pay the installments of interest
or principal (if applicable) on any due date provided for herein or
within ten (10) days thereafter, then Borrower further promises to pay
a late payment charge equal to five percent (5.0%) of the amount of
the unpaid installment as liquidated compensation to Bank for the
extra expense to Bank to process and administer the late payment,
Borrower agreeing, by execution hereof, that any other measure of
compensation for a late payment is speculative and impossible to
compute. This
2
provision for late charges shall not be deemed to extend the time for
payment or be a "grace period" or "cure period" that gives Borrower a
right to cure a Default or Default Condition. Imposition of late
charges is not contingent upon the giving of any notice or lapse of
any cure period provided for in the Mortgage and shall not be deemed a
waiver of any right or remedy of Bank, including without limitation,
acceleration of this Note.
F. MATURITY DATE. The then outstanding principal balance plus all accrued
but unpaid interest shall be due and payable on September 1, 1999 (the
"Maturity Date"). The Maturity Date shall be automatically extended
for two (2) additional three month (3) periods (the three (3) month
period hereafter referred to as the first three (3) month extension
referred to as the "First Renewal Period", the second three (3) month
extension referred to as the "Second Renewal Period", or either or
both referred to as a "Renewal Term") on the same terms and conditions
as are contained in this Note, commencing on the Maturity Date,
provided the following conditions have been satisfied:
1. Borrower and Guarantor are not in Default under the Loan and no
Default Condition exists;
2. There has been no material adverse change in the financial
condition of the Borrower or Guarantor;
3. Borrower, prior to the commencement of each Renewal Term remits
to Bank an additional non-refundable prorated origination fee of
one quarter of one percent (0.25%) of all outstanding and
unfunded committed Note amounts computed as of the Maturity Date;
4. An acceptable title endorsement has been submitted to Bank;
5. Borrower shall have provided Bank with an internally prepared
year end statement (including consolidating schedules) as well as
the most recent quarter end financial statements both in such
form as described in the Loan Agreement; and
6. With respect to the request for the first three (3) month
renewal, Borrower has provided written notice to Bank not later
than six (6) months prior to Maturity Date ("First Renewal"); and
pursuant to such notice, Bank, at its sole and absolute
discretion, not later than sixty (60) days following the First
Renewal Request Date ("Notification Date") has approved the first
extension and notified Borrower in writing of same. With respect
to the request for the second three (3) month renewal, Borrower
has provided written notice not later than three (3) months prior
to the Extended Maturity Date (the "Second Renewal Request Date")
and pursuant to such
3
notice, Bank at its sole and absolute discretion, not later than
thirty (30) days following the Second Renewal Request Date has
approved the extension and notified Borrower in writing of same.
If Bank notifies Borrower that it does not intend to grant the
Renewal Term by the Notification Date or if Bank does not notify
Borrower by the Notification Date that it will grant the Renewal Term,
the entire outstanding balance of the Note shall be due and payable on
the Maturity Date. If Borrower does not provide written notice to Bank
of its election to extend the Maturity Date on or before the Request
Date, the outstanding balance of the Note shall also be due and
payable in full on the Maturity Date. Bank's decision to grant the
Renewal Term shall be made by Bank in its sole and absolute discretion
and approval of the Renewal Term may be withheld for any reason. Bank
shall not be under any obligation to grant the Renewal Term. If the
Renewal Term is granted, such Renewal Term shall be on the same terms
and conditions as this Note and all of the terms and conditions of the
Security Documents and the Loan Agreement shall apply. If Borrower or
the Guarantor Defaults under the Loan between the Notification Date
and the Maturity Date, or if any of the foregoing terms and conditions
are not satisfied as required above, this Note shall be due and
payable in full on the Maturity Date. Borrower agrees to execute any
documents as Bank may reasonably request in connection with any
extension of the Maturity Date.
G. DEFAULT. Any failure of Borrower or any Guarantor to comply with any
term, covenant,or condition of this Note, including without
limitation, Borrower's failure to pay principal, interest, or expenses
when same shall become due or Default under the Security Documents or
Loan Agreement after any applicable cure period shall be deemed, at
the option of Bank, a Default under this Note. Any judgment rendered
on this Note shall bear interest at the Default Rate. Notwithstanding
the foregoing, Borrower shall have a ten (10) day grace period for the
payment of interest and expenses.
H. ACCELERATION. Upon the occurrence of a Default hereunder or under the
terms of any one or more of the Security Documents or the Loan
Agreement, Bank may declare the then outstanding principal and all
accrued but unpaid interest immediately due and payable and upon
acceleration and thereafter this Note shall bear interest at the
Default Rate, hereinafter defined, until all indebtedness evidenced
hereby and secured by the Security Documents has been paid in full.
Further, in the event of such acceleration, the Loan, and all other
indebtedness of Borrower to Bank arising out of or in connection with
the Loan shall become immediately due and payable, without
presentation, demand, protest or notice of any kind, all of which are
hereby waived by Borrower. ANY JUDGMENT RENDERED ON THIS NOTE SHALL
BEAR INTEREST AT THE DEFAULT RATE (AS HEREIN DEFINED).
4
I. DEFAULT RATE. After default, and following the expiration of any
applicable cure period, or maturity or upon acceleration, and
thereafter, the unpaid indebtedness then evidenced by this Note and
due under and secured by the Security Documents shall bear interest at
a fixed rate equal to the lesser of (a) the maximum rate then
permitted under applicable law, or (b) twenty percent (20.0%) per
annum.
J. APPLICATION OF PAYMENTS. All sums received by Bank for application to
the Loan may be applied by Bank to late charges, expenses, costs,
interest, principal, and other amounts owing to Bank in connection
with the Loan in the order selected by Bank in its sole discretion.
K. EXPENSES. In the event this Note is not paid when due on any stated or
accelerated maturity date, or should it be necessary for Bank to
enforce any other of its rights under this Note, the Loan Agreement,
or the Security Documents, Borrower will pay to Bank, in addition to
principal, interest and other charges due hereunder or under the Loan
Agreement or the Security Documents, all costs of collection or
enforcement, including reasonable attorneys' fees, paralegals' fees,
legal assistants' fees, costs and expenses, whether incurred with
respect to collection, arbitration, litigation, bankruptcy
proceedings, interpretation, dispute, negotiation, trial, appeal,
defense of actions instituted by a third party against Bank arising
out of or related to the Loan, enforcement of any judgment based on
this Note, or otherwise, whether or not a suit to collect such amounts
or to enforce such rights is brought or, if brought, is prosecuted to
judgment.
L. WAIVER. All persons now or at any time liable for payment of this
Note, whether directly or indirectly, including without limitation any
Guarantor, hereby waive presentment, protest, notice of protest and
dishonor. The undersigned expressly consents to any extensions and
renewals, in whole or in part, to the release of any or all Guarantors
or co-makers and any collateral security or portions thereof, given to
secure this Note, and all delays in time of payment or other
performance which Bank may grant, in its sole discretion, at any time
and from time to time without limitation all without any notice or
further consent of Borrower, and any such grant by Bank shall not be
deemed a waiver of any subsequent delay or any of Bank's rights
hereunder or under the Loan Agreement or the Security Documents.
M. USURY. In no event shall this or any other provision herein or in the
Loan Agreement or Security Documents, permit the collection of any
interest which would be usurious under the laws of the State of
Florida. If any such interest in excess of the maximum rate allowable
under applicable law has been collected, Borrower agrees that the
amount of interest collected above the maximum rate permitted by
applicable law, together with interest thereon at the rate required by
applicable law, shall be refunded to Borrower, and Borrower agrees to
accept
5
such refund, or, at Borrower's option, such refund shall be applied as
a principal payment hereunder.
N. MODIFICATION. This Note may not be changed orally, but only by an
agreement in writing signed by the Bank and Borrower.
O. APPLICABLE LAW. This Note shall be governed by and construed in
accordance with the laws of the State of Florida.
P. NOTICES. All notices or other communications required or permitted to
be given pursuant to the provisions of this Note shall be given in
accordance with the notice provisions of the Mortgage.
Q. SUCCESSORS AND ASSIGNS. As used herein, the terms "Borrower" and
"Bank" shall be deemed to include their respective heirs, personal
representatives, successors and assigns.
R. SEVERABILITY. In the event any one or more of the provisions of this
Note shall for any reason be held to be invalid, illegal, or
unenforceable, in whole or in part or in any respect, or in the event
that any one or more of the provisions of this Note operates or would
prospectively operate to invalidate this Note, then and in any of
those events, only such provision or provisions shall be deemed null
and void and shall not affect any other provision of this Note. The
remaining provisions of this Note shall remain operative and in full
force and effect and shall in no way be affected, prejudiced, or
disturbed thereby. In the event any provisions of this Note are
inconsistent with the provisions of the Loan Agreement, the Security
Documents, or any other agreements or documents executed in connection
with this Note, this Note shall control.
S. CAPTIONS; PRONOUNS. Captions are for reference only and in no way
limit the terms of this Note. The pronouns used in this instrument
shall be construed as masculine, feminine, or neuter as the occasion
may require. Use of the singular includes the plural, and vice versa.
T. BUSINESS DAY. Any reference herein or in the Loan Agreement or
Security Documents to a day or business day shall be deemed to refer
to a banking day which shall be a day on which Bank is open for the
transaction of business, excluding any national holidays, and any
performance which would otherwise be required on a day other than a
banking day shall be timely performed in such instance, if performed
on the next succeeding banking day. Notwithstanding such timely
performance, interest shall continue to accrue hereunder until such
payment or performance has been made.
6
U. DISCLOSURE OF BORROWER AND GUARANTOR FINANCIAL INFORMATION. The owner
of this Note may, from time to time, sell or offer to sell the Loan
evidenced by this Note, or interests therein, to one or more assignees
or participants and is hereby authorized to disseminate any
information it has pertaining to the loan evidenced by this Note,
including, without limitation, any security for this Note and credit
information on Borrower, any of its principals and any Guarantor of
this Note, to any company affiliated with the owner of this Note, any
assignee or participant or prospective assignee or prospective
participant, and to the extent, if any, specified in any such
assignment or participation, such affiliated companies, assignee(s) or
participant(s) shall have the rights and benefits with respect to this
Note, the Security Documents or the Loan Agreement as such person(s)
would have if such person(s) were Bank hereunder. The Bank or its
successors and/or assigns as owner of this Note may also disclose any
such information to any regulatory body having jurisdiction over Bank.
V. MANDATORY ARBITRATION. Any controversy or claim between or among the
parties hereto including, but not limited to, those arising out of or
relating to this agreement or any related agreements or instruments,
including any claim based on or arising from an alleged tort, shall be
determined by binding arbitration in accordance with the Federal
Arbitration Act (or if not applicable, the applicable state law), the
Rules of Practice and Procedure for the Arbitration of Commercial
Disputes of Judicial Arbitration and Mediation Services, Inc.
(J.A.M.S.), and the "Special Rules" set forth below. In the event of
any inconsistency, the Special Rules shall control. Judgment upon any
arbitration award may be entered in any court having jurisdiction. Any
party to this agreement may bring an action, including a summary or
expedited proceeding, to compel arbitration of any controversy or
claim to which this agreement applies in any court having
jurisdiction' over such action.
1. Special Rules: The arbitration shall be conducted in Broward
County, Florida, and administered by Endispute, Inc., d/b/a
J.A.M.S./Endispute who will appoint an arbitrator; if
J.A.M.S./Endispute is unable or legally precluded from
administering the arbitration, then the American Arbitration
Association will serve. All arbitration hearings will be
commenced within 90 days of the demand for arbitration; further,
the arbitrator shall only, upon a showing of cause, be permitted
to extend the commencement of such hearing for up to an
additional 60 days.
2. Reservations of Rights: Nothing in this agreement shall be deemed
to (i) limit the applicability of any otherwise applicable
statutes of limitation or repose and any waivers contained in
this agreement; or (ii) be a waiver by the Bank of the protection
afforded to it by 12 U.S.C. Section 91 or any substantially
equivalent state law; or (iii) limit the right of the Bank hereto
(A) to exercise self help remedies such as (but not limited to)
setoff, or
7
(B) to foreclose against any real or personal property
collateral, or (C) to obtain from a court provisional or
ancillary remedies such as (but not limited to) injunctive relief
or the appointment of a receiver. The Bank may exercise such self
help rights, foreclose upon such property, or obtain such
provisional or ancillary remedies before, during or after the
pendency of any arbitration proceeding brought pursuant to this
agreement. At Bank's option, foreclosure under a mortgage or deed
of trust may be accomplished by any of the following: the
exercise of a power of sale under the deed of trust or mortgage,
or by judicial sale under the deed of trust or mortgage, or by
judicial foreclosure. Neither this exercise of self help remedies
nor the institution or maintenance of an action for foreclosure
or provisional or ancillary remedies shall constitute a waiver of
the right of any party, including the claimant in any such
action, to arbitrate the merits of the controversy or claim
occasioning resort to such remedies.
IN WITNESS WHEREOF, Borrower has caused this Note to be duly executed as of
the day and year first above written.
TRANSEASTERN PEMBROKE VILLAGES,
INC., a Florida corporation
By _______________________(SEAL)
Xxxxxx Xxxxxxx, Executive
Vice President
Documentary Stamps in the amount of $12,556.25 have been paid and affixed to the
Real Estate Mortgage, Assignment and Security Agreement securing this Note.
8
Borrower's Taxpayer
Identification No: 00-0000000
PROMISSORY NOTE
(REVOLVING LINE OF CREDIT)
$3,000,000.00
September ____, 0000
Xxxx Xxxxxxxxxx, Xxxxxxx
FOR VALUE RECEIVED, TRANSEASTERN PEMBROKE VILLAGES, INC., a Florida
corporation, (sometimes hereinafter referred to as the "undersigned" or the
"Borrower"), promises to pay to the order of CHASE FEDERAL BANK, A FEDERAL
SAVINGS BANK, NATIONSBANK, N.A. (SOUTH), a national banking association, or any
subsequent holder of this note ("Bank") at its principal offices located at
Suite 101, 000 Xxxx Xxxxxxx Xxxxx Xxxx, Xxxx Xxxxxxxxxx, Xxxxxxx 00000, or such
other place or places as Bank may designate) the principal sum of THREE MILLION
AND NO/100 DOLLARS ($3,000,000.00) or so much thereof as may be from time to
time outstanding, plus interest thereon at the Rate hereinafter defined, all in
accordance with the terms and conditions of this Promissory Note (Revolving line
of Credit) (the "Note") and in accordance with the Loan Agreement by and between
Borrower and Bank of even date (the "Loan Agreement") . This Note is secured by
a Real Estate Mortgage, Assignment, and Security Agreement of even date filed or
to be filed for record in the public records of Broward County, Florida (the
"Mortgage"), Guaranty Agreements (the "Guaranty") of Transeastern Properties,
Inc., a Florida corporation, f/k/a Transeastern Properties of South Florida,
Inc., a Florida corporation, Xxxxxx Xxxxxxx, Xxxxxx Xxxxxxx and Xxxxxx Xxxxx
(the "Guarantor"), UCC Financing Statements of even date filed or to be filed
for record in the public records of Broward County, Florida, and in the Office
of the Secretary of State of the State of Florida (the "Financing Statements") ,
and other agreements by and between Borrower and Bank. The Mortgage, Guaranty,
Financing Statements and such other agreements are hereinafter referred to
collectively as the "Security Documents" and the loan evidenced thereby is
hereinafter referred to as the "Loan." Terms used herein but not otherwise
defined hereunder are defined as set forth in the Security Documents or the Loan
Agreement. All of the terms, definitions, conditions and covenants of the
Security Documents or the Loan Agreement are expressly made a part of this Note
by reference in the same manner and with the same effect as if set forth herein
at length, and any holder of this Note is entitled to the benefits of and
remedies provided in the Security Documents or the Loan Agreement. Subject to
the terms and conditions of this Note and the Security Documents, Bank shall
advance funds to Borrower pursuant to the terms of the Loan Agreement such that
Borrower may use the line of credit provided for by this Note by borrowing,
paying and repaying, in whole or in part, and reborrowing on a revolving basis,
up to a maximum principal sum of THREE MILLION AND NO/100 DOLLARS
($3,000,000.00) at any one time outstanding, the funds evidenced by this note.
A. PRIME RATE. For purposes hereof, "Prime Rate" means the
fluctuating rate of interest per annum established by Bank as
its prime lending rate in effect from time to time whether or
not such rate shall be otherwise published. Such Prime Rate is
established by Bank as an index or base rate and may or may
not at any time be the best or lowest rate of interest offered
by Bank.
B. INTEREST. The outstanding Loan principal balance shall bear
interest at a variable rate per annum equal to the Prime Rate
plus one (1.00%). The interest rate hereunder shall be
adjusted daily in accordance with fluctuations in the Prime
Rate. Interest shall be computed on the basis of a daily
amount of interest accruing on the daily outstanding principal
balance during a 360- day year multiplied by the actual number
of days the principal is outstanding during such applicable
interest period.
C. PAYMENT OF INTEREST. Interest accrued in accordance with this
Note shall be due and payable monthly, in arrears, on the
FIRST day of each month immediately following the calendar
month for which said interest has accrued. All accrued but
unpaid interest and principal shall be due and payable in full
on the Maturity Date, as defined in Paragraph 6 below. All
payments of principal and interest shall be made in lawful
currency of the United States of America which shall be legal
tender in payment of all debts, public and private, at the
time of payment.
D. PREPAYMENT. This Note may be prepaid in whole or in part at
any time without fee, premium or penalty. Any partial
prepayment shall be applied in accordance with paragraph 10
below and shall not postpone the due date of any subsequent
periodic installments or the Maturity Date, or change the
amount of such installments due, unless Bank shall otherwise
agree in writing.
E. LATE CHARGES. Should Borrower fail to pay the installments of
interest or principal (if applicable) on any due date provided
for herein or within ten (10) days thereafter, then Borrower
further promises to pay a late payment charge equal to five
percent (5.0%) of the amount of the unpaid installment as
liquidated compensation to Bank for the extra expense to Bank
to process and administer the late payment, Borrower agreeing,
by execution hereof, that any other measure of compensation
for a late payment is speculative and impossible to compute.
This provision for late charges shall not be deemed to extend
the time for payment or be a "grace period" or "cure period"
that gives Borrower a right to cure a Default or Default
Condition. Imposition of late charges is not contingent upon
the giving of any notice or lapse of any cure period provided
for in the Mortgage and shall not be deemed a waiver of any
right or remedy of Bank, including without limitation,
acceleration of this Note.
F. MATURITY DATE. The then outstanding principal balance plus all
accrued but unpaid interest shall be due and payable on
September 1, 1999 (the "Maturity
2
Date"). The Maturity Date shall be automatically extended for
two (2) additional three month (3) periods (each three (3)
month period hereafter referred to as the "Renewal Term") on
the same terms and conditions as are contained in this Note,
commencing on the Maturity Date, provided the following
conditions have been satisfied:
1. Borrower and Guarantor are not in Default under the
Loan and no Default Condition exists;
2. There has been no material adverse change in the
financial condition of the Borrower or Guarantor;
3. Borrower, prior to the commencement of the Renewal
Term remits to Bank an additional non-refundable
prorated origination fee of one quarter of one
percent (0.25%) of all outstanding and unfunded
committed Note amounts computed as of the Maturity
Date;
4. An acceptable title endorsement has been submitted to
Bank;
5. Borrower shall have provided Bank with an internally
prepared year end statement (including consolidating
schedules) as well as the most recent quarter end
financial statements both in such form as described
in the Loan Agreement; and
6. With respect to the request for the first three (3)
month renewal, Borrower has provided written notice
to Bank not later than six (6) months prior to
Maturity Date ("First Renewal"); and pursuant to such
notice, Bank, at its sole and absolute discretion,
not later than sixty (60) days following the First
Renewal Request Date ("Notification Date") has
approved the first extension and notified Borrower in
writing of same. With respect to the request for the
second three (3) month renewal, Borrower has provided
written notice not later than three (3) months prior
to the Extended Maturity Date (the "Second Renewal
Request Date") and pursuant to such notice, Bank at
its sole and absolute discretion, not later than
thirty (30) days following the Second Renewal Request
Date has approved the extension and notified Borrower
in writing of same.
If Bank notifies Borrower that it does not intend to
grant the Renewal Term by the Notification Date or if Bank
does not notify Borrower by the Notification Date that it will
grant the Renewal Term, the entire outstanding balance of the
Note shall be due and payable on the Maturity Date. If
Borrower does not provide written notice to Bank of its
election to extend the Maturity Date on or before the Request
Date , the outstanding balance of the Note shall also be due
and payable in full on the Maturity Date. Bank's decision to
grant the
3
Renewal Term shall be made by Bank in its sole and absolute
discretion and approval of the Renewal Term may be withheld
for any reason. Bank shall not be under any obligation to
grant the Renewal Term. If the Renewal Term is granted, such
Renewal Term shall be on the same terms and conditions as this
Note and all of the terms and conditions of the Security
Documents and the Loan Agreement shall apply. If Borrower or
the Guarantor Defaults under the Loan between the Notification
Date and the Maturity Date, or if any of the foregoing terms
and conditions are not satisfied as required above, this Note
shall be due and payable in full on the Maturity Date.
Borrower agrees to execute any documents as Bank may
reasonably request in connection with any extension of the
Maturity Date.
G. DEFAULT. Any failure of Borrower or any Guarantor to comply
with any term, covenant,or condition of this Note, including
without limitation, Borrower's failure to pay principal,
interest, or expenses when same shall become due or Default
under the Security Documents or Loan Agreement after any
applicable cure period shall be deemed, at the option of Bank,
a Default under this Note. Any judgment rendered on this Note
shall bear interest at the Default Rate. Notwithstanding the
foregoing, Borrower shall have a ten (10) day grace period for
the payment of interest and expenses.
H. ACCELERATION. Upon the occurrence of a Default hereunder or
under the terms of any one or more of the Security Documents
or the Loan Agreement, Bank may declare the then outstanding
principal and all accrued but unpaid interest immediately due
and payable and upon acceleration and thereafter this Note
shall bear interest at the Default Rate, hereinafter defined,
until all indebtedness evidenced hereby and secured by the
Security Documents has been paid in full. Further, in the
event of such acceleration, the Loan, and all other
indebtedness of Borrower to Bank arising out of or in
connection with the Loan shall become immediately due and
payable, without presentation, demand, protest or notice of
any kind, all of which are hereby waived by Borrower. ANY
JUDGMENT RENDERED ON THIS NOTE SHALL BEAR INTEREST AT THE
DEFAULT RATE (AS HEREIN DEFINED).
I. DEFAULT RATE. After default, and following the expiration of
any applicable cure period, or maturity or upon acceleration,
and thereafter, the unpaid indebtedness then evidenced by this
Note and due under and secured by the Security Documents shall
bear interest at a fixed rate equal to the lesser of (a) the
maximum rate then permitted under applicable law, or (b)
twenty percent (20.0%) per annum.
J. APPLICATION OF PAYMENTS. All sums received by Bank for
application to the Loan may be applied by Bank to late
charges, expenses, costs, interest, principal, and other
amounts owing to Bank in connection with the Loan in the order
selected by Bank in its sole discretion.
4
K. EXPENSES. In the event this Note is not paid when due on any
stated or accelerated maturity date, or should it be necessary
for Bank to enforce any other of its rights under this Note,
the Loan Agreement, or the Security Documents, Borrower will
pay to Bank, in addition to principal, interest and other
charges due hereunder or under the Loan Agreement or the
Security Documents, all costs of collection or enforcement,
including reasonable attorneys' fees, paralegals' fees, legal
assistants' fees, costs and expenses, whether incurred with
respect to collection, arbitration, litigation, bankruptcy
proceedings, interpretation, dispute, negotiation, trial,
appeal, defense of actions instituted by a third party against
Bank arising out of or related to the Loan, enforcement of any
judgment based on this Note, or otherwise, whether or not a
suit to collect such amounts or to enforce such rights is
brought or, if brought, is prosecuted to judgment.
L. WAIVER. All persons now or at any time liable for payment of
this Note, whether directly or indirectly, including without
limitation any Guarantor, hereby waive presentment, protest,
notice of protest and dishonor. The undersigned expressly
consents to any extensions and renewals, in whole or in part,
to the release of any or all Guarantors or co-makers and any
collateral security or portions thereof, given to secure this
Note, and all delays in time of payment or other performance
which Bank may grant, in its sole discretion, at any time and
from time to time without limitation all without any notice or
further consent of Borrower, and any such grant by Bank shall
not be deemed a waiver of any subsequent delay or any of
Bank's rights hereunder or under the Loan Agreement or the
Security Documents.
M. USURY. In no event shall this or any other provision herein
or in the Loan Agreement or Security Documents, permit the
collection of any interest which would be usurious under the
laws of the State of Florida. If any such interest in excess
of the maximum rate allowable under applicable law has been
collected, Borrower agrees that the amount of interest
collected above the maximum rate permitted by applicable law,
together with interest thereon at the rate required by
applicable law, shall be refunded to Borrower, and Borrower
agrees to accept such refund, or, at Borrower's option, such
refund shall be applied as a principal payment hereunder.
N. MODIFICATION. This Note may not be changed orally, but only
by an agreement in writing signed by the Bank and Borrower.
O. APPLICABLE LAW. This Note shall be governed by and construed
in accordance with the laws of the State of Florida.
P. NOTICES. All notices or other communications required or
permitted to be given pursuant to the provisions of this Note
shall be given in accordance with the notice provisions of the
Mortgage.
5
Q. SUCCESSORS AND ASSIGNS. As used herein, the terms "Borrower"
and "Bank" shall be deemed to include their respective heirs,
personal representatives, successors and assigns.
R. SEVERABILITY. In the event any one or more of the provisions
of this Note shall for any reason be held to be invalid,
illegal, or unenforceable, in whole or in part or in any
respect, or in the event that any one or more of the
provisions of this Note operates or would prospectively
operate to invalidate this Note, then and in any of those
events, only such provision or provisions shall be deemed null
and void and shall not affect any other provision of this
Note. The remaining provisions of this Note shall remain
operative and in full force and effect and shall in no way be
affected, prejudiced, or disturbed thereby. In the event any
provisions of this Note are inconsistent with the provisions
of the Loan Agreement, the Security Documents, or any other
agreements or documents executed in connection with this Note,
this Note shall control.
S. CAPTIONS; PRONOUNS. Captions are for reference only and in no
way limit the terms of this Note. The pronouns used in this
instrument shall be construed as masculine, feminine, or
neuter as the occasion may require. Use of the singular
includes the plural, and vice versa.
T. BUSINESS DAY. Any reference herein or in the Loan Agreement
or Security Documents to a day or business day shall be deemed
to refer to a banking day which shall be a day on which Bank
is open for the transaction of business, excluding any
national holidays, and any performance which would otherwise
be required on a day other than a banking day shall be timely
performed in such instance, if performed on the next
succeeding banking day. Notwith- standing such timely
performance, interest shall continue to accrue hereunder until
such payment or performance has been made.
U. DISCLOSURE OF BORROWER AND GUARANTOR FINANCIAL INFORMATION.
The owner of this Note may, from time to time, sell or offer
to sell the Loan evidenced by this Note, or interests therein,
to one or more assignees or participants and is hereby
authorized to disseminate any information it has pertaining to
the loan evidenced by this Note, including, without
limitation, any security for this Note and credit information
on Borrower, any of its principals and any Guarantor of this
Note, to any company affiliated with the owner of this Note,
any assignee or participant or prospective assignee or
prospective participant, and to the extent, if any, specified
in any such assignment or participation, such affiliated
companies, assignee(s) or participant(s) shall have the rights
and benefits with respect to this Note, the Security Documents
or the Loan Agreement as such person(s) would have if such
person(s) were Bank hereunder. The Bank or its successors
and/or assigns as owner of this Note may also disclose any
such information to any regulatory body having jurisdiction
over Bank.
6
V. MANDATORY ARBITRATION. Any controversy or claim between or
among the parties hereto including, but not limited to, those
arising out of or relating to this agreement or any related
agreements or instruments, including any claim based on or
arising from an alleged tort, shall be determined by binding
arbitration in accordance with the Federal Arbitration Act (or
if not applicable, the applicable state law), the Rules of
Practice and Procedure for the Arbitration of Commercial
Disputes of Judicial Arbitration and Mediation Services, Inc.
(J.A.M.S.), and the "Special Rules" set forth below. In the
event of any inconsistency, the Special Rules shall control.
Judgment upon any arbitration award may be entered in any
court having jurisdiction. Any party to this agreement may
bring an action, including a summary or expedited proceeding,
to compel arbitration of any controversy or claim to which
this agreement applies in any court having jurisdiction' over
such action.
1. Special Rules: The arbitration shall be conducted in
Broward County, Florida, and administered by
Endispute, Inc., d/b/a J.A.M.S./Endispute who will
appoint an arbitrator; if J.A.M.S./Endispute is
unable or legally precluded from administering the
arbitration, then the American Arbitration
Association will serve. All arbitration hearings will
be commenced within 90 days of the demand for
arbitration; further, the arbitrator shall only, upon
a showing of cause, be permitted to extend the
commencement of such hearing for up to an additional
60 days.
2. Reservations of Rights: Nothing in this agreement
shall be deemed to (i) limit the applicability of any
otherwise applicable statutes of limitation or repose
and any waivers contained in this agreement; or (ii)
be a waiver by the Bank of the protection afforded to
it by 12 U.S.C. Section 91 or any substantially
equivalent state law; or (iii) limit the right of the
Bank hereto (A) to exercise self help remedies such
as (but not limited to) setoff, or (B) to foreclose
against any real or personal property collateral, or
(C) to obtain from a court provisional or ancillary
remedies such as (but not limited to) injunctive
relief or the appointment of a receiver. The Bank may
exercise such self help rights, foreclose upon such
property, or obtain such provisional or ancillary
remedies before, during or after the pendency of any
arbitration proceeding brought pursuant to this
agreement. At Bank's option, foreclosure under a
mortgage or deed of trust may be accomplished by any
of the following: the exercise of a power of sale
under the deed of trust or mortgage, or by judicial
sale under the deed of trust or mortgage, or by
judicial foreclosure. Neither this exercise of self
help remedies nor the institution or maintenance of
an action for foreclosure or provisional or ancillary
remedies shall constitute a waiver of the right of
any party, including the claimant in any such action,
to arbitrate the merits of the controversy or claim
occasioning resort to such remedies.
7
IN WITNESS WHEREOF, Borrower has caused this Note to be duly executed
as of the day and year first above written.
TRANSEASTERN PEMBROKE VILLAGES,
INC., a Florida corporation
By _______________________________(SEAL)
Xxxxxx Xxxxxxx, Executive Vice President
Documentary Stamps in the amount of $10,500.00 have been paid and affixed to the
Real Estate Mortgage, Assignment and Security Agreement securing this Note.
8
Loan No. 91000839
GUARANTY AGREEMENT
THIS GUARANTY AGREEMENT, dated as of September ___, 1996
(the"Guaranty") is executed by TRANSEASTERN PROPERTIES, INC., A FLORIDA
CORPORATION, F/K/A TRANSEASTERN PROPERTIES OF SOUTH FLORIDA, INC., A FLORIDA
CORPORATION, (the "Guarantor"), and extended to CHASE FEDERAL BANK, A F.S.B., A
DIVISION OF NATIONSBANK, N.A. (SOUTH), a national banking association ("Bank")
for the benefit of TRANSEASTERN PEMBROKE VILLAGES, INC., A FLORIDA CORPORATION,
a Florida limited partnership ("Borrower").
RECITALS:
1. Bank has agreed to extend a loan (the "Loan") to Borrower pursuant
to the terms and conditions of, among other documents, a Promissory Note in the
original principal amount of EIGHT MILLION SEVEN HUNDRED THIRTY SEVEN THOUSAND
FIVE HUNDRED AND NO/100 DOLLARS ($8,737,500.00) of even date herewith executed
and delivered by Borrower in favor of Bank (the "Note") and a Loan Agreement of
even date, by and between Borrower and Bank (the "Loan Agreement") for the
infrastructure development for two (2) parcels of land to be developed into 114
single family lots and 356 townhome lots in those certain projects known as
Egret's Way and Pelican Pointe located in Pembroke Pines, Florida (the
"Mortgaged Property") , which Loan is secured by a Real Estate Mortgage,
Assignment, and Security Agreement of even date filed or to be filed in the
public records of Broward County, Florida (the "Mortgage"), a Hazardous
Substance Certificate and Indemnification Agreement of even date between
Borrower, Guarantor and Bank (the "Indemnity") and other agreements to be
executed by the Borrower and Bank. The Mortgage, this Guaranty, the Indemnity
and the other agreements are hereinafter referred to collectively as the
"Security Documents". The Security Documents and the Loan Agreement are
hereinafter referred to collectively for convenience as the "Loan Documents".
2. Guarantor is a shareholder of TRANSEASTERN PEMBROKE VILLAGES, INC.,
a Florida corporation.
3. Without this Guaranty, Bank would be unwilling to make the Loan to
Borrower.
4. Because of the direct benefit to Guarantor from the Loan to
Borrower, and as an inducement to Bank to make the Loan to Borrower, Guarantor
agrees to guarantee to Bank the obligations of Borrower as set forth herein.
NOW, THEREFORE, in consideration of Bank entering into the Loan
Agreement and making the Loan to Borrower, and for other good and valuable
consideration by Borrower to Guarantor, the receipt and sufficiency of which is
hereby acknowledged by Guarantor, Guarantor hereby covenants and agrees as
follows:
1. GUARANTY OF PAYMENT. Guarantor hereby unconditionally guarantees to
Bank the payment, when due, by acceleration or otherwise, of the Indebtedness.
For the purposes hereof, the term "Indebtedness" shall include any and all
indebtedness and obligations of Borrower to Bank, except as the Guarantor's
liability is specifically limited in the Loan Documents, including without
limitation, all principal , interest, fees and expenses, including attorneys'
fees, evidenced by the Note, the Loan Agreement, the Security Documents or
otherwise, or arising in connection with the Loan, whether existing now or
arising hereafter, as such Indebtedness may be modified, increased, extended or
renewed from time to time. The guaranty of Guarantor as set forth in this
section is a guaranty of payment and not of collection.
2. GUARANTY OF PERFORMANCE. Guarantor additionally unconditionally
guarantees to Bank the timely performance of all other obligations of Borrower
under all of the Loan Documents, including, without limiting the generality of
the foregoing, that:
(a) the Improvements will be constructed upon the Land in accordance
with the Loan Agreement and with the Plans; and
(b) the Improvements will be completed and ready for occupancy,
including delivery of any certificates, licenses, and permits required
by law or the Loan Agreement, within the time periods required in the
Loan Agreement.
In the event the foregoing obligations of Borrower are not timely
performed in any respect whatsoever, Guarantor, without the necessity of any
notice from Bank to Guarantor, agrees to (i) assume all responsibility for the
completion of the Improvements and, at Guarantor's own cost and expense, to
cause the Improvements to be fully completed in accordance with the Plans and in
accordance with the Loan Agreement; (ii) pay all bills, costs, and expenses in
connection with the construction and completion of the Improvements; and (iii)
indemnify and hold Bank harmless from any and all loss, cost, liability or
expense Bank may suffer by reason of any such acts or omissions of Borrower. If,
after the occurrence of a Default by Borrower, Guarantor has not caused
construction to progress as required by the Loan Agreement, Bank may, at its
option, after first having given notice to the Guarantor at the address set
forth below in the manner prescribed herein for giving notice, complete the
Improvements either before or after commencement of foreclosure proceedings or
before or after any other remedy of Bank against Borrower or Guarantor, with
such changes or modifications in the Plans which Bank reasonably deems necessary
and expend such sums as Bank, in its discretion, reasonably deems necessary and
proper in order to so complete the Improvements, and Guarantor hereby waives any
right to contest any such expenditures. The amount of any and all expenditures
made by Bank for the foregoing purposes shall be due and payable to Bank upon
demand and accrue interest at the rate then applicable under the Note (or that
would be applicable under the Note if it were still outstanding).
3. SUBORDINATION.
3.1 All rights and claims of Guarantor now or hereafter existing
(collectively the
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"Guarantor Claims") against Borrower or any of Borrower's
property which Borrower now owns or shall acquire in the future or hereafter
existing shall be subordinate and subject in right of payment to the prior
payment in full of the Indebtedness to Bank.
3.2 Until the Indebtedness has been paid in full and Guarantor shall
have performed or satisfied all of its obligations hereunder and provided no
Default exists, Guarantor may receive or collect, directly or indirectly, from
Borrower or any other party any payment upon Guarantor Claims, seek to realize
upon any collateral securing such Guarantor Claims or claim any offset or other
reduction of Guarantor's obligations hereunder because of any Guarantor Claims.
Notwithstanding the foregoing, only if a Default exists, if Guarantor should
receive any such payment, Guarantor agrees to hold same in trust for Bank and
agrees that Guarantor shall have absolutely no rights in or to or dominion over,
such payments except to pay them promptly to Bank without demand by Bank.
4. GUARANTOR WAIVERS. Guarantor hereby waives and agrees not to assert
or take advantage of (a) any right or claim of right to cause a marshaling of
any of Borrower's assets or the assets of any other party now or hereafter held
as security for the Indebtedness; (b) the defense of the statute of limitations
in any action hereunder or for the payment of the Indebtedness and performance
of any obligation hereby guaranteed; (c) any defense that may arise by reason of
the incapacity, lack of authority, death or disability of Guarantor, any other
guarantor of the Loan, or Borrower or any other person or entity, or the
voluntary or involuntary dissolution of Borrower or Guarantor, or the failure of
Bank to file or enforce a claim against the estate (either in administration,
bankruptcy, or any other proceeding) of Borrower or any other person or entity;
(d) any defense based on the failure of Bank to give notice of the existence,
creation, or incurring of any new or additional indebtedness or obligation, or
of any action or nonaction on the part of any other person whomsoever, or any
modification of the terms of the Loan Documents, or the Indebtedness, in
connection with any obligation hereby guaranteed; (e) any defense based upon an
election of remedies by Bank which destroys or otherwise impairs any subrogation
rights of Guarantor or any other guarantor of the Loan or the right of Guarantor
to proceed against Borrower or any other guarantor for reimbursement, or both;
(f) any defense based upon failure of Bank to commence an action against
Borrower; (g) any defense based upon acceptance of this Guaranty by Bank; (h)
any defense based upon the invalidity or unenforceability of any of the Loan
Documents; (i) any defense based upon any limitation of liability contained in
any of the Loan Documents unless specifically set forth therein; (j) any defense
based upon any transfer by Borrower of all or any part of the Collateral; (k)
any defense based upon the failure of Bank to perfect any security or to extend
or renew the perfection of any security; and (l) any other legal or equitable
defenses whatsoever to which Guarantor might otherwise be entitled.
5. CONSENT TO BANK'S ACTIONS OR INACTIONS. Guarantor consents that Bank
may, at any time and from time to time, before or after any Default by Borrower,
without affecting the liability of Guarantor hereunder and with or without
further notice to or assent from Guarantor:
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5.1 Either with or without consideration to Borrower or to any
guarantor guaranteeing the completion of the Project or payment of any portion
of the Indebtedness, or any pledgor or grantor of any collateral, exchange,
release or surrender (in whole or in part), or fail to protect or to preserve
the value of any collateral now or hereafter held as security for the Loan, or
waive, release or subordinate any lien or security interest (in whole or in
part) in or on any such collateral;
5.2 Waive or delay the exercise of any of its rights or remedies
against Borrower or any other person or entity, including without limitation,
any guarantor guaranteeing the completion of the Project or payment of any
portion of the Indebtedness; notwithstanding any waiver or delay, Bank shall not
be precluded from further exercise of any of its rights, powers or privileges
expressly provided for herein or otherwise available, it being understood that
all such rights and remedies are cumulative;
5.3 Waive or extend the time from Borrower's or any other guarantor's
performance of any and all terms, provisions and conditions set forth in the
Loan Documents;
5.4 Release Borrower or any other person or entity, including without
limitation any other guarantor guaranteeing the completion of the Project or
payment of any portion of the Indebtedness, from their obligations to complete
the Project and/or from their obligations to repay all or any portion of the
Indebtedness;
5.5 Proceed against Guarantor without first proceeding against or
joining Borrower or any other guarantor guaranteeing the completion of the
Project or payment of any portion of the Indebtedness or any endorser of the
Note, or any property securing the payment of the Indebtedness;
5.6 Renew, extend or modify the terms of the Loan or any instrument or
agreement evidencing, securing, or relating to the Loan;
5.7 Generally deal with Borrower or other person or party or any
Collateral as Bank may see fit; and
5.8 Consent to any change in the Plans and/or the Improvements.
Guarantor shall remain bound under this Guaranty notwithstanding any
such exchange, release, surrender, subordination, waiver (whether or not such
waiver is oral or written), delay, proceeding, renewal, extension, modification,
act or failure to act, or other dealings described in Subsections 5.1 through
5.8 above, inclusive, including without limitation, any change in the Plans
and/or the Improvements even though done without notice to or consent from
Guarantor.
6. WAIVER OF NOTICE. Guarantor waives all notices whatsoever with
respect to the Loan Documents, including without limitation, this Guaranty, and
with respect to the Loan, including, but not limited to, notice of:
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6.1 Bank's acceptance of this Guaranty or its intention to act, or its
action, in reliance hereon;
6.2 The making of the Loan by Bank to Borrower;
6.3 Presentment and demand for payment of the Loan or any portion
thereof;
6.4 Protest and notice of dishonor or non-payment with respect to the
Loan or any portion thereof;
6.5 Any Default by Borrower or any pledgor, grantor of security, or any
other guarantor guaranteeing the completion of the Project and/or payment of any
portion of the Indebtedness;
6.6 Any other notices to which Guarantor may otherwise be entitled; and
6.7 Any demand for payment under this Guaranty.
7. PRIMARY LIABILITY OF GUARANTOR. Guarantor agrees that this Guaranty
may be enforced by Bank without the necessity at any time of resorting to or
exhausting any other security or collateral and without the necessity at any
time of having resorted to recourse to the Note or the Collateral through
foreclosure proceedings under the Security Documents or otherwise, and Guarantor
hereby waives any rights to require Bank to proceed against Borrower or any
other guarantor or to require Bank to pursue any other remedy or enforce any
other right. Guarantor further agrees that Guarantor shall have no right of
subrogation, reimbursement or indemnity whatsoever, nor any right of recourse to
security for the Indebtedness or Borrower to Bank, unless and until all of the
Indebtedness of Borrower to Bank has been paid in full. Guarantor further agrees
that nothing contained herein shall prevent Bank from suing on the Note or
foreclosing the Mortgage or from exercising any other rights available to it
under any other Loan Documents, or any other instrument of security if there is
a Default by Borrower or Guarantor , and the exercise of any of the aforesaid
rights and the completion of any foreclosure proceedings shall not constitute a
discharge of any of Guarantor's obligations hereunder; it being the purpose and
intent of Guarantor that Guarantor's obligations hereunder shall be absolute,
independent and unconditional under any and all circumstances. Neither
Guarantor's obligations under this Guaranty nor any remedy for the enforcement
thereof shall be impaired, modified, changed or released in any manner
whatsoever by an impairment, modification, change, release or limitation of the
liability of Borrower or any other guarantor or by reason of Borrower's or any
other guarantor's bankruptcy, insolvency, death, or dissolution. At any time
Bank is entitled to exercise its remedies hereunder, it may in its discretion
elect to demand payment or performance. In the event Bank elects to demand
performance, it shall at all times thereafter have the right to demand payment
until all of the Indebtedness has been paid in full. In the event Bank elects to
demand payment, it shall at all times thereafter have the right to demand
performance until all of the Indebtedness has been paid in full.
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8. SUBROGATION RIGHTS. Until the Loan is paid in full, Guarantor will
not assert any right to which it may be or may become entitled, whether by
subrogation, contribution or otherwise, against Borrower (except Guarantor's
right to receive a management fee and distribution of cash flow from Borrower
for so long as no Default exists) or any other guarantor guaranteeing the
completion of the Project or payment of any portion of the Indebtedness or
against any of their respective properties, by
reason of the performance by Guarantor of its obligations under this Guaranty,
except after completion of the Project and payment in full of the Indebtedness
in accordance with the Loan Agreement.
9. COST OF ENFORCEMENT. In the event that the Note or this Guaranty are
not paid when due after any applicable grace period on any stated or accelerated
maturity date, or should it be necessary for Bank to enforce any other of its
rights under the Loan Documents, Guarantor will pay to Bank, in addition to
principal, interest and other charges due hereunder or under the other Loan
Documents, all costs of collection or enforcement, including reasonable
attorneys' fees, paralegals' fees, legal assistants' fees, costs and expenses,
whether incurred with respect to collection, arbitration, litigation, bankruptcy
proceedings, interpretation, dispute, negotiation, trial, appeal, defense of
actions instituted by a third party against Bank arising out of or related to
the Loan, enforcement of any judgment based on this Guaranty, or otherwise,
whether or not a suit to collect such amounts or to enforce such rights is
brought or, if brought, is prosecuted to judgment.
10. GRANT. INTENTIONALLY DELETED
11. TERM OF GUARANTY; WARRANTIES. This Guaranty shall continue in full
force and effect until the Indebtedness is fully paid, and all obligations of
Borrower and Guarantor are performed and discharged. This Guaranty covers the
Indebtedness whether presently outstanding or arising subsequent to the date
hereof including all amounts advanced by Bank in stages or installments.
Guarantor warrants and represents to Bank, (i) that this Guaranty is binding
upon and enforceable against Guarantor, its heirs, personal representatives,
executors, successors, and assigns in accordance with its terms, (ii) that the
execution and delivery of this Guaranty do not violate any applicable laws or
constitute a breach of any agreement to which Guarantor is a party, (iii) that
there is no litigation, claim, action or proceeding pending or, to the best
knowledge of Guarantor, threatened against Guarantor which would adversely
affect the financial condition of Guarantor or its ability to fulfill its
obligations hereunder. Guarantor agrees to promptly inform Bank of the adverse
determination of any litigation, claim, action or proceeding or the institution
of any litigation, claim, action or proceeding against Guarantor which does or
could adversely affect the financial condition of Guarantor or its ability to
fulfill its obligations hereunder.
12. FURTHER REPRESENTATIONS AND WARRANTIES. Guarantor further
represents to Bank that Guarantor has knowledge of Borrower's financial
condition and affairs and represents and agrees that it will keep so informed
while this Guaranty is in force. Guarantor agrees that Bank has no present or
future obligation to investigate the financial condition or affairs of Borrower
for the benefit of Guarantor nor to advise Guarantor of any fact respecting, or
any change in,
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the financial condition or affairs of Borrower or any other
guarantor of the Loan which might come to the knowledge of Bank at any time,
whether or not Bank knows or believes or has reason to know or believe that any
such fact or change is unknown to Guarantor or might (or does) increase the risk
of Guarantor as guarantor or might (or would) affect the willingness of
Guarantor to continue as a guarantor with respect to the Indebtedness.
13. FINANCIAL STATEMENTS. Guarantor shall submit annual financial
statements to Bank within one hundred twenty (120) days of each June 30th of the
Loan, and interim financial statements to Bank within thirty (30) days after
Bank has requested same in writing. The statements shall include, at a minimum,
the following current items: a balance sheet, an income and expense statement, a
statement showing contingent liabilities, detailed information regarding project
sales and construction status on each project and/or entity in which Guarantor
has an interest and any supporting schedules or documentation which Bank may
require. Such detailed statements shall include, as applicable, the project
name, location, percentage of Guarantor's ownership interest, leasing status,
net operating income, current loan balance, debt service, source of any
operating deficit, amount of and beneficiary of any cash distributions, and the
amount of cash invested in or received from that enterprise. Each statement
shall bear an authorized signature attesting to the accuracy of the statement.
Annual statements of business entities shall be audited and bear the unqualified
opinion of an acceptable certified public accountant. Guarantor shall also
provide Bank with current year personal tax returns within thirty (30) days of
filing.
14. ADDITIONAL LIABILITY OF GUARANTOR. If Guarantor is or becomes
liable for any indebtedness owing by Borrower to Bank by endorsement or
otherwise than under this Guaranty, such liability shall not be in any manner
impaired or reduced hereby but shall have all and the same force and effect it
would have had if this Guaranty had not existed and Guarantor's liability
hereunder shall not be in any manner impaired or reduced thereby.
15. CUMULATIVE RIGHTS. All rights of Bank hereunder or otherwise
arising under any documents executed in connection with or as security for the
Indebtedness are separate and cumulative and may be pursued separately,
successively or concurrently, or not pursued without affecting, reducing or
limiting any other right of Bank and without affecting, reducing or impairing
the liability of Guarantor.
16. MULTIPLE COUNTERPARTS; PRONOUNS; CAPTIONS; SEVERABILITY. This
Guaranty may be executed in multiple counterparts, each of which shall be deemed
an original but all of which shall constitute but one and the same document. The
pronouns used in this instrument shall be construed as masculine, feminine or
neuter as the occasion may require. Use of the singular includes the plural, and
vice versa. Captions are for reference only and in no way limit the terms of
this Guaranty. Invalidation of any one
or more of the provisions of this Guaranty shall in no way affect any of the
other provisions hereof, which shall remain in full force and effect. Use of the
term "include" or "including" is always without limitation. "Person" or "party"
means any natural person or artificial entity having legal capacity.
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17. BANK ASSIGNS. This Guaranty is intended for and shall inure to the
benefit of Bank and each and every person who shall from time to time be or
become the owner or holder of any document evidencing or securing the
Indebtedness, and each and every reference herein to Bank shall include and
refer to each and every successor or assignee of Bank at any time holding or
owning any part of or interest in any part of the Indebtedness. This Guaranty
shall be transferable and negotiable with the same force and effect, and to the
same extent, that any document evidencing or securing all or any portion of the
Indebtedness is transferable and negotiable, it being understood and stipulated
that upon assignment or transfer by Bank of any of the Indebtedness, the legal
holder or owner of said Indebtedness (or a part thereof or interest therein thus
transferred or assigned by Bank) shall (except as otherwise stipulated by Bank
in its assignment) have and may exercise all of the rights granted to Bank under
this Guaranty to the extent of that part of or interest in the Indebtedness thus
assigned or transferred to said person. Guarantor expressly waives notice of
transfer or assignment of the Indebtedness, or any part thereof, or of the
rights of Bank hereunder. Failure to give notice will not affect the liabilities
of Guarantor hereunder. Bank may sell or offer to sell the Loan or interests in
the Loan to one or more assignees or participants and may disclose to any such
assignee or participant or prospective assignee or participant any information
Lender has pertaining to the Guaranteed Obligations, this Guaranty, or
Guarantor, including, without limitation, information regarding any security for
the Guaranteed obligations or any other party liable, directly or indirectly,
for any part of the Guaranteed Obligations. Bank may also disclose any such
information to any regulatory body having jurisdiction over Bank.
18. APPLICATION OF PAYMENTS. Bank may apply any payments received by it
from any source against that portion of the Indebtedness (principal, interest,
court costs, attorneys' fees or other) in such priority and fashion as it may
deem appropriate.
19. NOTICES. Any notice or demand that must or may be given or made in
connection with this Guaranty must be in writing and, unless receipt is
expressly required, will be deemed given, delivered or made, as the case may be,
when delivered by personal delivery or the day after it is mailed by Express
Mail, by overnight delivery service of a nationally-recognized company,
addressed to the parties at the following addresses, or such other addresses as
may from time to time be designated by written notice given as herein required:
to Guarantor:
Xxxxxx Xxxxxxx
Transeastern Pembroke Villages, Inc.
0000 Xxxxxxxxxx Xxxxx, Xxxxx Xxxxxxx, XX 00000
to Bank:
NationsBank of Florida, N.A.
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000 X. Xxxxxxx Xxxxx Xxxx, Xxxxx 000
Xxxx Xxxxxxxxxx, XX 00000
Attention: Xxxxx X. Xxxx, Real Estate Banking Officer
Personal delivery to a party or to any officer, partner, agent or employee of
such party, or if a proper person, to a member of his family, at its address
herein shall constitute receipt. Rejection or other refusal to accept or
inability to deliver because of changed address of which no notice has been
received shall also constitute receipt. Notwithstanding the foregoing, no notice
of change of address shall be effective until the date of receipt thereof. This
section shall not be construed in any way to affect or impair any waiver of
notice or demand herein provided or to require giving of notice or demand to or
upon Guarantor in any situation or for any reason.
20. CONFLICT OF LAW. This Guaranty shall be construed, interpreted,
enforced and governed by and in accordance with the laws of the State of
Florida.
21. SUBMISSION TO JURISDICTION. Guarantor irrevocably and
unconditionally (a) agrees that any suit, action or other legal proceeding
arising out of or relating to this Guaranty may be brought, at the option of
Bank, in a court of competent jurisdiction of the State of Florida or any United
States District Court in Florida; (b) consents to the jurisdiction of each such
court in any such suit, action or proceeding; (c) waives any and all personal
rights under the laws of any state to object to the laying of venue of any such
suit, action or proceeding in the State of Florida; and (d) agrees that service
of any court paper may be effected on Guarantor by mail, addressed and mailed as
provided in Section 19 hereof or in such other manner as may be provided under
applicable laws or court rules in the State of Florida. Nothing contained
herein, however, shall prevent Bank from bringing an action or exercising any
rights against any security for the Loan or against Guarantor personally, and
against any property of Guarantor, within any other state. Initiating such
proceeding or taking such action in any other state shall in no event constitute
a waiver of the agreement contained herein that the law of the State of Florida
shall govern the rights and obligations of Guarantor and Bank hereunder or of
the submission herein made by Guarantor to personal jurisdiction within the
State of Florida. The aforesaid means of obtaining personal jurisdiction and
perfecting service of process are not intended to be exclusive but are
cumulative and in addition to all other means of obtaining personal jurisdiction
and perfecting service of process now or hereafter provided by the law of the
State of Florida.
22. WAIVER OF HOMESTEAD. Guarantor waives any and all homestead
and exemption rights which it may have under or by virtue of the Constitution or
the laws of the United States of America or of any state as against this
Guaranty, any renewal hereof, or any indebtedness represented hereby, and does
jointly and severally transfer, convey, and assign to Bank a sufficient amount
of such homestead or exemption as may be allowed, including such homestead or
exemption as may be set apart in bankruptcy, to pay all amounts due hereunder in
full, with all costs of collection, and does hereby direct any trustee in
bankruptcy having possession of such homestead or exemption to deliver to Bank a
sufficient amount of property or money set apart as exempt to pay the
indebtedness guaranteed hereby, or any renewal thereof, and does
9
hereby appoint Bank the attorney-in-fact for each of them, to claim any and all
homestead exemptions allowed by law.
23. CONTINUING LIABILITY. Notwithstanding any other provisions of this
Guaranty, the Indebtedness shall be deemed to include any and all liability,
damage, cost and expense, including reasonable attorneys' fees, paralegals' fees
and legal assistants' fees, which may hereafter be incurred by Bank as a result
of the Mortgaged Property:
(a) having been used in the past or present or being used in the
future while the Mortgaged Property is owned by Borrower, for the sale,
handling, storage, transportation, or disposal of hazardous or toxic materials,
in violation of any Governmental Requirements in effect from time to time
regulating hazardous or toxic materials or the Mortgaged Property; or
(b) having contained or hereafter containing, while the Mortgaged
Property is owned by Borrower, asbestos or products containing asbestos in
violation of any laws, ordinances, or regulations of any Governmental
Authorities affecting asbestos or products containing asbestos or the Mortgaged
Property.
Except as Guarantor's liability is specifically limited in the Loan
Documents, it is expressly acknowledged by Guarantor that this indemnification
shall survive in accordance with the terms and conditions set forth in the
Hazardous Substance Certificate and Indemnification Agreement of even date
herewith executed by the Guarantor and Borrower.
24. DISCLOSURE OF BORROWER AND GUARANTOR FINANCIAL INFORMATION. Bank
may sell or offer to sell the Loan or interests in the Loan to one or more
assignees or participants and may disclose to any such assignee or participant
or prospective assignee or participant any information Bank has pertaining to
the Loan Documents, this Guaranty, or Guarantor, including, without limitation,
information regarding any security for the Loan Documents or for this Guaranty,
credit information on Guarantor, Borrower, and/or any other party liable,
directly or indirectly, for any part of the Loan Documents. Bank may also
disclose any such information to any regulatory body having jurisdiction over
Bank.
25. ORAL MODIFICATION INEFFECTIVE. This Guaranty may not be changed
orally, and no obligation of Guarantor can be released or waived by Bank or any
officer or agent of Bank, except by a writing signed by a duly authorized
officer of Bank. This Guaranty shall be irrevocable by Guarantor until the
Indebtedness has been completely repaid and all obligations and undertakings of
Borrower under, by reason of, or pursuant to the Loan Documents have been
completely performed, at which time Bank will terminate this Guaranty. This
Guaranty shall continue in full force and effect unless and until discharged or
released by Bank pursuant to a written instrument properly executed by an
appropriate officer of Bank. This Guaranty shall continue in full force and
effect unless and until discharged or released by Bank pursuant to a written
instrument properly executed by an appropriate officer of Bank.
26. REFERENCE TO OTHER LOAN DOCUMENTS. All of the terms,
definitions, conditions
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and covenants of the Loan Agreement, the Note, the
Mortgage, and the Assignment are expressly made a part of this Guaranty by
reference in the same manner and with the same effect as if set forth herein at
length and shall have the meaning set forth in the Loan Agreement, the Note, the
Mortgage, and the Assignment unless otherwise defined herein.
27. MANDATORY ARBITRATION. Any controversy or claim between or among
the parties hereto including, but not limited to, those arising out of or
relating to this Agreement or any related agreements or instruments, including
any claim based on or arising from an alleged tort, shall be determined by
binding arbitration in accordance with the Federal Arbitration Act (or if not
applicable, the applicable state law), the Rules of Practice and Procedure for
the Arbitration of Commercial Disputes of Judicial Arbitration and
Mediations Services, Inc. (J.A.M.A.S.), and the "Special Rules" set forth below.
In the event of any inconsistency, the Special Rules shall control. Judgment
upon any arbitration award may be entered in any court having jurisdiction. Any
party to this Agreement may bring an action, including a summary or expedited
proceeding, to compel arbitration of any controversy or claim to which this
Agreement applies in any court having jurisdiction over such action.
(a) Special Rules: The arbitration shall be conducted in Broward
County, Florida and administered by Endispute, Inc., d/b/a J.A.M.S./Endispute
who will appoint an arbitrator; if J.A.M.S./Endispute is unable or legally
precluded from administering the arbitration, then the American Arbitration
Association will serve. All arbitration hearings will be commenced within 90
days of the demand for arbitration; further, the arbitrator shall only, upon a
showing of cause, be permitted to extend the commencement of such hearing for up
to an additional 60 days.
(b) Reservations of Rights: Nothing in this Agreement shall be
deemed to (i) limit the applicability of any otherwise applicable statutes of
limitation or repose and any waivers contained in this Agreement; or (ii) be a
waiver by the Bank of the protection afforded to it by 12 U.S.C. Section 91 or
any substantially equivalent state law; or (iii) limit the right of the Bank
hereto (A) to exercise self help remedies such as (but not limited to) setoff,
or (B) to foreclose against any real or personal property collateral, or (C) to
obtain from a court provisional or ancillary remedies such as (but not limited
to) injunctive relief or the appointment of a receiver. The Bank may exercise
such self help rights, foreclose upon such property, or obtain such provisional
or ancillary remedies before, during or after the pendency of any arbitration
proceeding brought pursuant to this Agreement. At Bank's option, foreclosure
under a mortgage or deed of trust may be accomplished by any of the following:
the exercise of a power of sale under the deed of trust or mortgage, or by
judicial sale under the deed of trust or mortgage, or by judicial foreclosure.
Neither this exercise of self help remedies nor the institution or maintenance
of an action for foreclosure or provisional or ancillary remedies shall
constitute a waiver of the right of any party, including the claimant in any
such action, to arbitrate the merits of the controversy or claim occasioning
resort to such remedies.
IN WITNESS WHEREOF, Guarantor has executed this Guaranty under seal as of
the day and year first above written.
11
Signed, sealed and delivered
in the presence of: TRANSEASTERN PROPERTIES, INC.,
A FLORIDA CORPORATION, F/K/A TRANSEASTERN
PROPERTIES OF SOUTH FLORIDA, INC., A
FLORIDA CORPORATION
____________________________________
Witness #1 By_________________________________(SEAL)
____________________________________ Xxxxxx Xxxxxxx, Executive Vice President
____________________________________
Print Name
____________________________________ Address:
Witness #1
0000 Xxxxxxxxxx Xxxxx
____________________________________ Xxxxx Xxxxxxx, Xxxxxxx 00000
Print Name
STATE OF FLORIDA )
)ss
COUNTY OF BROWARD )
The foregoing instrument was acknowledged before me this ____ day of
September, 1996, by XXXXXX XXXXXXX, as EXECUTIVE VICE President of TRANSEASTERN
PROPERTIES INC., a Florida corporation, f/k/a Transeastern Properties of South
Florida, Inc., a Florida corporation, by and on behalf the corporation. He is
personally known to me and/or has produced ________________________________ as
identification.
My Commission Expires: ___________________________________________
NOTARY PUBLIC STATE OF FLORIDA
___________________________________________
Print Name
Loan No. 91004439
GUARANTY AGREEMENT
THIS GUARANTY AGREEMENT, dated as of September ___, 1996
(the "Guaranty") is executed by TRANSEASTERN PROPERTIES, INC., A FLORIDA
CORPORATION, F/K/A TRANSEASTERN PROPERTIES OF SOUTH FLORIDA, INC., A FLORIDA
CORPORATION (the "Guarantor"), and extended to CHASE FEDERAL BANK, A FEDERAL
SAVINGS BANK, A DIVISION OF NATIONSBANK, N.A. (SOUTH), a national banking
association ("Bank") for the benefit of TRANSEASTERN PEMBROKE VILLAGES, INC., A
FLORIDA CORPORATION, a Florida limited partnership ("Borrower").
RECITALS:
1. Bank has agreed to extend a loan (the "Loan") to Borrower
pursuant to the terms and conditions of, among other documents, a Promissory
Note in the original principal amount of THREE MILLION FOUR HUNDRED THOUSAND AND
NO/100 DOLLARS ($3,400,000.00) of even date herewith executed and delivered by
Borrower in favor of Bank (the "Note") and a Loan Agreement of even date, by and
between Borrower and Bank (the "Loan Agreement") for the construction of of up
to 356 townhomes in that certain project known as Pelican Pointe located in
Pembroke Pines, Florida (the "Mortgaged Property") , which Loan is secured by a
Real Estate Mortgage, Assignment, and Security Agreement of even date filed or
to be filed in the public records of Broward County, Florida (the "Mortgage"), a
Hazardous Substance Certificate and Indemnification Agreement of even date
between Borrower, Guarantor and Bank (the "Indemnity") and other agreements to
be executed by the Borrower and Bank. The Mortgage, this Guaranty, the Indemnity
and the other agreements are hereinafter referred to collectively as the
"Security Documents". The Security Documents and the Loan Agreement are
hereinafter referred to collectively for convenience as the "Loan Documents".
2. Guarantor is a shareholder of TRANSEASTERN PEMBROKE VILLAGES,
INC., a Florida corporation.
3. Without this Guaranty, Bank would be unwilling to make the
Loan to Borrower.
4. Because of the direct benefit to Guarantor from the Loan to
Borrower, and as an inducement to Bank to make the Loan to Borrower, Guarantor
agrees to guarantee to Bank the obligations of Borrower as set forth herein.
NOW, THEREFORE, in consideration of Bank entering into the Loan
Agreement and making the Loan to Borrower, and for other good and valuable
consideration by Borrower to Guarantor, the receipt and sufficiency of which is
hereby acknowledged by Guarantor, Guarantor hereby covenants and agrees as
follows:
1. GUARANTY OF PAYMENT. Guarantor hereby unconditionally
guarantees to Bank the payment, when due, by acceleration or otherwise, of the
Indebtedness. For the purposes hereof,
the term "Indebtedness" shall include any and all indebtedness and obligations
of Borrower to Bank, except as the Guarantor's liability is specifically limited
in the Loan Documents, including without limitation, all principal , interest,
fees and expenses, including attorneys' fees, evidenced by the Note, the Loan
Agreement, the Security Documents or otherwise, or arising in connection with
the Loan, whether existing now or arising hereafter, as such Indebtedness may be
modified, increased, extended or renewed from time to time. The guaranty of
Guarantor as set forth in this section is a guaranty of payment and not of
collection.
2. GUARANTY OF PERFORMANCE. Guarantor additionally
unconditionally guarantees to Bank the timely performance of all other
obligations of Borrower under all of the Loan Documents, including, without
limiting the generality of the foregoing, that:
(a) the Improvements will be constructed upon the Land in
accordance with the Loan Agreement and with the Plans; and
(b) the Improvements will be completed and ready for
occupancy, including delivery of any certificates, licenses, and permits
required by law or the Loan Agreement, within the time periods required in the
Loan Agreement.
In the event the foregoing obligations of Borrower are not timely
performed in any respect whatsoever, Guarantor, without the necessity of any
notice from Bank to Guarantor, agrees to (i) assume all responsibility for the
completion of the Improvements and, at Guarantor's own cost and expense, to
cause the Improvements to be fully completed in accordance with the Plans and in
accordance with the Loan Agreement; (ii) pay all bills, costs, and expenses in
connection with the construction and completion of the Improvements; and (iii)
indemnify and hold Bank harmless from any and all loss, cost, liability or
expense Bank may suffer by reason of any such acts or omissions of Borrower. If,
after the occurrence of a Default by Borrower, Guarantor has not caused
construction to progress as required by the Loan Agreement, Bank may, at its
option, after first having given notice to the Guarantor at the address set
forth below in the manner prescribed herein for giving notice, complete the
Improvements either before or after commencement of foreclosure proceedings or
before or after any other remedy of Bank against Borrower or Guarantor, with
such changes or modifications in the Plans which Bank reasonably deems necessary
and expend such sums as Bank, in its discretion, reasonably deems necessary and
proper in order to so complete the Improvements, and Guarantor hereby waives any
right to contest any such expenditures. The amount of any and all expenditures
made by Bank for the foregoing purposes shall be due and payable to Bank upon
demand and accrue interest at the rate then applicable under the Note (or that
would be applicable under the Note if it were still outstanding).
3. SUBORDINATION.
3.1 All rights and claims of Guarantor now or hereafter existing
(collectively the "Guarantor Claims") against Borrower or any of Borrower's
property which Borrower now owns or shall acquire in the future or hereafter
existing shall be subordinate and subject in right of
2
payment to the prior payment in full of the Indebtedness to Bank.
3.2 Until the Indebtedness has been paid in full and Guarantor
shall have performed or satisfied all of its obligations hereunder and provided
no Default exists, Guarantor may receive or collect, directly or indirectly,
from Borrower or any other party any payment upon Guarantor Claims, seek to
realize upon any collateral securing such Guarantor Claims or claim any offset
or other reduction of Guarantor's obligations hereunder because of any Guarantor
Claims. Notwithstanding the foregoing, only if a Default exists, if Guarantor
should receive any such payment, Guarantor agrees to hold same in trust for Bank
and agrees that Guarantor shall have absolutely no rights in or to or dominion
over, such payments except to pay them promptly to Bank without demand by Bank.
4. GUARANTOR WAIVERS. Guarantor hereby waives and agrees not to
assert or take advantage of (a) any right or claim of right to cause a
marshaling of any of Borrower's assets or the assets of any other party now or
hereafter held as security for the Indebtedness; (b) the defense of the statute
of limitations in any action hereunder or for the payment of the Indebtedness
and performance of any obligation hereby guaranteed; (c) any defense that may
arise by reason of the incapacity, lack of authority, death or disability of
Guarantor, any other guarantor of the Loan, or Borrower or any other person or
entity, or the voluntary or involuntary dissolution of Borrower or Guarantor, or
the failure of Bank to file or enforce a claim against the estate (either in
administration, bankruptcy, or any other proceeding) of Borrower or any other
person or entity; (d) any defense based on the failure of Bank to give notice of
the existence, creation, or incurring of any new or additional indebtedness or
obligation, or of any action or nonaction on the part of any other person
whomsoever, or any modification of the terms of the Loan Documents, or the
Indebtedness, in connection with any obligation hereby guaranteed; (e) any
defense based upon an election of remedies by Bank which destroys or otherwise
impairs any subrogation rights of Guarantor or any other guarantor of the Loan
or the right of Guarantor to proceed against Borrower or any other guarantor for
reimbursement, or both; (f) any defense based upon failure of Bank to commence
an action against Borrower; (g) any defense based upon acceptance of this
Guaranty by Bank; (h) any defense based upon the invalidity or unenforceability
of any of the Loan Documents; (i) any defense based upon any limitation of
liability contained in any of the Loan Documents unless specifically set forth
therein; (j) any defense based upon any transfer by Borrower of all or any part
of the Collateral; (k) any defense based upon the failure of Bank to perfect any
security or to extend or renew the perfection of any security; and (l) any other
legal or equitable defenses whatsoever to which Guarantor might otherwise be
entitled.
5. CONSENT TO BANK'S ACTIONS OR INACTIONS. Guarantor consents
that Bank may, at any time and from time to time, before or after any Default by
Borrower, without affecting the liability of Guarantor hereunder and with or
without further notice to or assent from Guarantor:
5.1 Either with or without consideration to Borrower or to any
guarantor guaranteeing the completion of the Project or payment of any portion
of the Indebtedness, or any pledgor or
3
grantor of any collateral, exchange, release or surrender (in whole or in part),
or fail to protect or to preserve the value of any collateral now or hereafter
held as security for the Loan, or waive, release or subordinate any lien or
security interest (in whole or in part) in or on any such collateral;
5.2 Waive or delay the exercise of any of its rights or remedies
against Borrower or any other person or entity, including without limitation,
any guarantor guaranteeing the completion of the Project or payment of any
portion of the Indebtedness; notwithstanding any waiver or delay, Bank shall not
he precluded from further exercise of any of its rights, powers or privileges
expressly provided for herein or otherwise available, it being understood that
all such rights and remedies are cumulative;
5.3 Waive or extend the time from Borrower's or any other
guarantor's performance of any and all terms, provisions and conditions set
forth in the Loan Documents;
5.4 Release Borrower or any other person or entity, including
without limitation any other guarantor guaranteeing the completion of the
Project or payment of any portion of the Indebtedness, from their obligations to
complete the Project and/or from their obligations to repay all or any portion
of the Indebtedness;
5.5 Proceed against Guarantor without first proceeding against
or joining Borrower or any other guarantor guaranteeing the completion of the
Project or payment of any portion of the Indebtedness or any endorser of the
Note, or any property securing the payment of the Indebtedness;
5.6 Renew, extend or modify the terms of the Loan or any
instrument or agreement evidencing, securing, or relating to the Loan;
5.7 Generally deal with Borrower or other person or party or any
Collateral as Bank may see fit; and
5.8 Consent to any change in the Plans and/or the Improvements.
Guarantor shall remain bound under this Guaranty notwithstanding any
such exchange, release, surrender, subordination, waiver (whether or not such
waiver is oral or written), delay, proceeding, renewal, extension, modification,
act or failure to act, or other dealings described in Subsections 5.1 through
5.8 above, inclusive, including without limitation, any change in the Plans
and/or the Improvements even though done without notice to or consent from
Guarantor.
6. WAIVER OF NOTICE. Guarantor waives all notices whatsoever
with respect to the Loan Documents, including without limitation, this Guaranty,
and with respect to the Loan, including, but not limited to, notice of:
6.1 Bank's acceptance of this Guaranty or its intention to act, or
its action, in reliance
4
hereon;
6.2 The making of the Loan by Bank to Borrower;
6.3 Presentment and demand for payment of the Loan or any portion
thereof;
6.4 Protest and notice of dishonor or non-payment with respect to
the Loan or any portion thereof;
6.5 Any Default by Borrower or any pledgor, grantor of security,
or any other guarantor guaranteeing the completion of the Project and/or payment
of any portion of the Indebtedness;
6.6 Any other notices to which Guarantor may otherwise be
entitled; and
6.7 Any demand for payment under this Guaranty.
7. PRIMARY LIABILITY OF GUARANTOR. Guarantor agrees that this
Guaranty may be enforced by Bank without the necessity at any time of resorting
to or exhausting any other security or collateral and without the necessity at
any time of having resorted to recourse to the Note or the Collateral through
foreclosure proceedings under the Security Documents or otherwise, and Guarantor
hereby waives any rights to require Bank to proceed against Borrower or any
other guarantor or to require Bank to pursue any other remedy or enforce any
other right. Guarantor further agrees that Guarantor shall have no right of
subrogation, reimbursement or indemnity whatsoever, nor any right of recourse to
security for the Indebtedness or Borrower to Bank, unless and until all of the
Indebtedness of Borrower to Bank has been paid in full. Guarantor further agrees
that nothing contained herein shall prevent Bank from suing on the Note or
foreclosing the Mortgage or from exercising any other rights available to it
under any other Loan Documents, or any other instrument of security if there is
a Default by Borrower or Guarantor , and the exercise of any of the aforesaid
rights and the completion of any foreclosure proceedings shall not constitute a
discharge of any of Guarantor's obligations hereunder; it being the purpose and
intent of Guarantor that Guarantor's obligations hereunder shall be absolute,
independent and unconditional under any and all circumstances. Neither
Guarantor's obligations under this Guaranty nor any remedy for the enforcement
thereof shall be impaired, modified, changed or released in any manner
whatsoever by an impairment, modification, change, release or limitation of the
liability of Borrower or any other guarantor or by reason of Borrower's or any
other guarantor's bankruptcy, insolvency, death, or dissolution. At any time
Bank is entitled to exercise its remedies hereunder, it may in its discretion
elect to demand payment or performance. In the event Bank elects to demand
performance, it shall at all times thereafter have the right to demand payment
until all of the Indebtedness has been paid in full. In the event Bank elects to
demand payment, it shall at all times thereafter have the right to demand
performance until all of the Indebtedness has been paid in full.
5
8. SUBROGATION RIGHTS. Until the Loan is paid in full, Guarantor
will not assert any right to which it may be or may become entitled, whether by
subrogation, contribution or otherwise, against Borrower (except Guarantor's
right to receive a management fee and distribution of cash flow from Borrower
for so long as no Default exists) or any other guarantor guaranteeing the
completion of the Project or payment of any portion of the Indebtedness or
against any of their respective properties, by reason of the performance by
Guarantor of its obligations under this Guaranty, except after completion of the
Project and payment in full of the Indebtedness in accordance with the Loan
Agreement.
9. COST OF ENFORCEMENT. In the event that the Note or this
Guaranty are not paid when due after any applicable grace period on any stated
or accelerated maturity date, or should it be necessary for Bank to enforce any
other of its rights under the Loan Documents, Guarantor will pay to Bank, in
addition to principal, interest and other charges due hereunder or under the
other Loan Documents, all costs of collection or enforcement, including
reasonable attorneys' fees, paralegals' fees, legal assistants' fees, costs and
expenses, whether incurred with respect to collection, arbitration, litigation,
bankruptcy proceedings, interpretation, dispute, negotiation, trial, appeal,
defense of actions instituted by a third party against Bank arising out of or
related to the Loan, enforcement of any judgment based on this Guaranty, or
otherwise, whether or not a suit to collect such amounts or to enforce such
rights is brought or, if brought, is prosecuted to judgment.
10. GRANT. INTENTIONALLY DELETED
11. TERM OF GUARANTY; WARRANTIES. This Guaranty shall continue in
full force and effect until the Indebtedness is fully paid, and all obligations
of Borrower and Guarantor are performed and discharged. This Guaranty covers the
Indebtedness whether presently outstanding or arising subsequent to the date
hereof including all amounts advanced by Bank in stages or installments.
Guarantor warrants and represents to Bank, (i) that this Guaranty is binding
upon and enforceable against Guarantor, its heirs, personal representatives,
executors, successors, and assigns in accordance with its terms, (ii) that the
execution and delivery of this Guaranty do not violate any applicable laws or
constitute a breach of any agreement to which Guarantor is a party, (iii) that
there is no litigation, claim, action or proceeding pending or, to the best
knowledge of Guarantor, threatened against Guarantor which would adversely
affect the financial condition of Guarantor or its ability to fulfill its
obligations hereunder. Guarantor agrees to promptly inform Bank of the adverse
determination of any litigation, claim, action or proceeding or the institution
of any litigation, claim, action or proceeding against Guarantor which does or
could adversely affect the financial condition of Guarantor or its ability to
fulfill its obligations hereunder.
12. FURTHER REPRESENTATIONS AND WARRANTIES. Guarantor further
represents to Bank that Guarantor has knowledge of Borrower's financial
condition and affairs and represents and agrees that it will keep so informed
while this Guaranty is in force. Guarantor agrees that Bank has no present or
future obligation to investigate the financial condition or affairs of Borrower
for the benefit of Guarantor nor to advise Guarantor of any fact respecting, or
any change in,
6
the financial condition or affairs of Borrower or any other guarantor of the
Loan which might come to the knowledge of Bank at any time, whether or not Bank
knows or believes or has reason to know or believe that any such fact or change
is unknown to Guarantor or might (or does) increase the risk of Guarantor as
guarantor or might (or would) affect the willingness of Guarantor to continue as
a guarantor with respect to the Indebtedness.
13. FINANCIAL STATEMENTS. Guarantor shall submit annual financial
statements to Bank within one hundred twenty (120) days of each June 30th of the
Loan, and interim financial statements to Bank within thirty (30) days after
Bank has requested same in writing. The statements shall include, at a minimum,
the following current items: a balance sheet, an income and expense statement, a
statement showing contingent liabilities, detailed information regarding project
sales and construction status on each project and/or entity in which Guarantor
has an interest and any supporting schedules or documentation which Bank may
require. Such detailed statements shall include, as applicable, the project
name, location, percentage of Guarantor's ownership interest, leasing status,
net operating income, current loan balance, debt service, source of any
operating deficit, amount of and beneficiary of any cash distributions, and the
amount of cash invested in or received from that enterprise. Each statement
shall bear an authorized signature attesting to the accuracy of the statement.
Annual statements of business entities shall be audited and bear the unqualified
opinion of an acceptable certified public accountant. Guarantor shall also
provide Bank with current year personal tax returns within thirty (30) days of
filing.
14. ADDITIONAL LIABILITY OF GUARANTOR. If Guarantor is or becomes
liable for any indebtedness owing by Borrower to Bank by endorsement or
otherwise than under this Guaranty, such liability shall not be in any manner
impaired or reduced hereby but shall have all and the same force and effect it
would have had if this Guaranty had not existed and Guarantor's liability
hereunder shall not be in any manner impaired or reduced thereby.
15. CUMULATIVE RIGHTS. All rights of Bank hereunder or otherwise
arising under any documents executed in connection with or as security for the
Indebtedness are separate and cumulative and may be pursued separately,
successively or concurrently, or not pursued without affecting, reducing or
limiting any other right of Bank and without affecting, reducing or impairing
the liability of Guarantor.
16. MULTIPLE COUNTERPARTS; PRONOUNS; CAPTIONS; SEVERABILITY. This
Guaranty may be executed in multiple counterparts, each of which shall be deemed
an original but all of which shall constitute but one and the same document. The
pronouns used in this instrument shall be construed as masculine, feminine or
neuter as the occasion may require. Use of the singular includes the plural, and
vice versa. Captions are for reference only and in no way limit the terms of
this Guaranty. Invalidation of any one or more of the provisions of this
Guaranty shall in no way affect any of the other provisions hereof, which shall
remain in full force and effect. Use of the term "include" or "including" is
always without limitation. "Person" or "party" means any natural person or
artificial entity having legal capacity.
7
17. BANK ASSIGNS. This Guaranty is intended for and shall inure to
the benefit of Bank and each and every person who shall from time to time be or
become the owner or holder of any document evidencing or securing the
Indebtedness, and each and every reference herein to Bank shall include and
refer to each and every successor or assignee of Bank at any time holding or
owning any part of or interest in any part of the Indebtedness. This Guaranty
shall be transferable and negotiable with the same force and effect, and to the
same extent, that any document evidencing or securing all or any portion of the
Indebtedness is transferable and negotiable, it being understood and stipulated
that upon assignment or transfer by Bank of any of the Indebtedness, the legal
holder or owner of said Indebtedness (or a part thereof or interest therein thus
transferred or assigned by Bank) shall (except as otherwise stipulated by Bank
in its assignment) have and may exercise all of the rights granted to Bank under
this Guaranty to the extent of that part of or interest in the Indebtedness thus
assigned or transferred to said person. Guarantor expressly waives notice of
transfer or assignment of the Indebtedness, or any part thereof, or of the
rights of Bank hereunder. Failure to give notice will not affect the liabilities
of Guarantor hereunder. Bank may sell or offer to sell the Loan or interests in
the Loan to one or more assignees or participants and may disclose to any such
assignee or participant or prospective assignee or participant any information
Lender has pertaining to the Guaranteed Obligations, this Guaranty, or
Guarantor, including, without limitation, information regarding any security for
the Guaranteed obligations or any other party liable, directly or indirectly,
for any part of the Guaranteed Obligations. Bank may also disclose any such
information to any regulatory body having jurisdiction over Bank.
18. APPLICATION OF PAYMENTS. Bank may apply any payments received
by it from any source against that portion of the Indebtedness (principal,
interest, court costs, attorneys' fees or other) in such priority and fashion as
it may deem appropriate.
19. NOTICES. Any notice or demand that must or may be given or
made in connection with this Guaranty must be in writing and, unless receipt is
expressly required, will be deemed given, delivered or made, as the case may be,
when delivered by personal delivery or the day after it is mailed by Express
Mail, by overnight delivery service of a nationally-recognized company,
addressed to the parties at the following addresses, or such other addresses as
may from time to time be designated by written notice given as herein required:
to Guarantor:
Xxxxxx Xxxxxxx
Transeastern Pembroke Villages, Inc.
0000 Xxxxxxxxxx Xxxxx, Xxxxx Xxxxxxx, XX 00000
to Bank:
NationsBank of Florida, N.A.
701 W. Cypress Creek Road, Suite 101
8
Xxxx Xxxxxxxxxx, XX 00000
Attention: Xxx Xxxx, Vice President
Personal delivery to a party or to any officer, partner, agent or employee of
such party, or if a proper person, to a member of his family, at its address
herein shall constitute receipt. Rejection or other refusal to accept or
inability to deliver because of changed address of which no notice has been
received shall also constitute receipt. Notwithstanding the foregoing, no notice
of change of address shall be effective until the date of receipt thereof. This
section shall not be construed in any way to affect or impair any waiver of
notice or demand herein provided or to require giving of notice or demand to or
upon Guarantor in any situation or for any reason.
20. CONFLICT OF LAW. This Guaranty shall be construed,
interpreted, enforced and governed by and in accordance with the laws of the
State of Florida.
21. SUBMISSION TO JURISDICTION. Guarantor irrevocably and
unconditionally (a) agrees that any suit, action or other legal proceeding
arising out of or relating to this Guaranty may be brought, at the option of
Bank, in a court of competent jurisdiction of the State of Florida or any United
States District Court in Florida; (b) consents to the jurisdiction of each such
court in any such suit, action or proceeding; (c) waives any and all personal
rights under the laws of any state to object to the laying of venue of any such
suit, action or proceeding in the State of Florida; and (d) agrees that service
of any court paper may be effected on Guarantor by mail, addressed and mailed as
provided in Section 19 hereof or in such other manner as may be provided under
applicable laws or court rules in the State of Florida. Nothing contained
herein, however, shall prevent Bank from bringing an action or exercising any
rights against any security for the Loan or against Guarantor personally, and
against any property of Guarantor, within any other state. Initiating such
proceeding or taking such action in any other state shall in no event constitute
a waiver of the agreement contained herein that the law of the State of Florida
shall govern the rights and obligations of Guarantor and Bank hereunder or of
the submission herein made by Guarantor to personal jurisdiction within the
State of Florida. The aforesaid means of obtaining personal jurisdiction and
perfecting service of process are not intended to be exclusive but are
cumulative and in addition to all other means of obtaining personal jurisdiction
and perfecting service of process now or hereafter provided by the law of the
State of Florida.
22. WAIVER OF HOMESTEAD. Guarantor waives any and all homestead
and exemption rights which it may have under or by virtue of the Constitution or
the laws of the United States of America or of any state as against this
Guaranty, any renewal hereof, or any indebtedness represented hereby, and does
jointly and severally transfer, convey, and assign to Bank a sufficient amount
of such homestead or exemption as may be allowed, including such homestead or
exemption as may be set apart in bankruptcy, to pay all amounts due hereunder in
full, with all costs of collection, and does hereby direct any trustee in
bankruptcy having possession of such homestead or exemption to deliver to Bank a
sufficient amount of property or money set apart as exempt to pay the
indebtedness guaranteed hereby, or any renewal thereof, and does hereby appoint
Bank the attorney-in-fact for each of them, to claim any and all homestead
9
exemptions allowed by law.
23. CONTINUING LIABILITY. Notwithstanding any other provisions of
this Guaranty, the Indebtedness shall be deemed to include any and all
liability, damage, cost and expense, including reasonable attorneys' fees,
paralegals' fees and legal assistants' fees, which may hereafter be incurred by
Bank as a result of the Mortgaged Property:
(a) having been used in the past or present or being used
in the future while the Mortgaged Property is owned by Borrower, for the sale,
handling, storage, transportation, or disposal of hazardous or toxic materials,
in violation of any Governmental Requirements in effect from time to time
regulating hazardous or toxic materials or the Mortgaged Property; or
(b) having contained or hereafter containing, while the
Mortgaged Property is owned by Borrower, asbestos or products containing
asbestos in violation of any laws, ordinances, or regulations of any
Governmental Authorities affecting asbestos or products containing asbestos or
the Mortgaged Property.
Except as Guarantor's liability is specifically limited in the Loan
Documents, it is expressly acknowledged by Guarantor that this indemnification
shall survive in accordance with the terms and conditions set forth in the
Hazardous Substance Certificate and Indemnification Agreement of even date
herewith executed by the Guarantor and Borrower.
24. DISCLOSURE OF BORROWER AND GUARANTOR FINANCIAL INFORMATION.
Bank may sell or offer to sell the Loan or interests in the Loan to one or more
assignees or participants and may disclose to any such assignee or participant
or prospective assignee or participant any information Bank has pertaining to
the Loan Documents, this Guaranty, or Guarantor, including, without limitation,
information regarding any security for the Loan Documents or for this Guaranty,
credit information on Guarantor, Borrower, and/or any other party liable,
directly or indirectly, for any part of the Loan Documents. Bank may also
disclose any such information to any regulatory body having jurisdiction over
Bank.
25. ORAL MODIFICATION INEFFECTIVE. This Guaranty may not be
changed orally, and no obligation of Guarantor can be released or waived by Bank
or any officer or agent of Bank, except by a writing signed by a duly authorized
officer of Bank. This Guaranty shall be irrevocable by Guarantor until the
Indebtedness has been completely repaid and all obligations and undertakings of
Borrower under, by reason of, or pursuant to the Loan Documents have been
completely performed, at which time Bank will terminate this Guaranty. This
Guaranty shall continue in full force and effect unless and until discharged or
released by Bank pursuant to a written instrument properly executed by an
appropriate officer of Bank. This Guaranty shall continue in full force and
effect unless and until discharged or released by Bank pursuant to a written
instrument properly executed by an appropriate officer of Bank.
26. REFERENCE TO OTHER LOAN DOCUMENTS. All of the terms,
definitions, conditions and covenants of the Loan Agreement, the Note, the
Mortgage, and the Assignment are
10
expressly made a part of this Guaranty by reference in the same manner and with
the same effect as if set forth herein at length and shall have the meaning set
forth in the Loan Agreement, the Note, the Mortgage, and the Assignment unless
otherwise defined herein.
27. MANDATORY ARBITRATION. Any controversy or claim between or
among the parties hereto including, but not limited to, those arising out of or
relating to this Agreement or any related agreements or instruments, including
any claim based on or arising from an alleged tort, shall be determined by
binding arbitration in accordance with the Federal Arbitration Act (or if not
applicable, the applicable state law), the Rules of Practice and Procedure for
the Arbitration of Commercial Disputes of Judicial Arbitration and Mediations
Services, Inc. (J.A.M.A.S.), and the "Special Rules" set forth below. In the
event of any inconsistency, the Special Rules shall control. Judgment upon any
arbitration award may be entered in any court having jurisdiction. Any party to
this Agreement may bring an action, including a summary or expedited proceeding,
to compel arbitration of any controversy or claim to which this Agreement
applies in any court having jurisdiction over such action.
(a) Special Rules: The arbitration shall be conducted in
Broward County, Florida and administered by Endispute, Inc., d/b/a
J.A.M.S./Endispute who will appoint an arbitrator; if J.A.M.S./Endispute is
unable or legally precluded from administering the arbitration, then the
American Arbitration Association will serve. All arbitration hearings will be
commenced within 90 days of the demand for arbitration; further, the arbitrator
shall only, upon a showing of cause, be permitted to extend the commencement of
such hearing for up to an additional 60 days.
(b) Reservations of Rights: Nothing in this Agreement
shall be deemed to (i) limit the applicability of any otherwise applicable
statutes of limitation or repose and any waivers contained in this Agreement; or
(ii) be a waiver by the Bank of the protection afforded to it by 12 U.S.C.
Section 91 or any substantially equivalent state law; or (iii) limit the right
of the Bank hereto (A) to exercise self help remedies such as (but not limited
to) setoff, or (B) to foreclose against any real or personal property
collateral, or (C) to obtain from a court provisional or ancillary remedies such
as (but not limited to) injunctive relief or the appointment of a receiver. The
Bank may exercise such self help rights, foreclose upon such property, or obtain
such provisional or ancillary remedies before, during or after the pendency of
any arbitration proceeding brought pursuant to this Agreement. At Bank's option,
foreclosure under a mortgage or deed of trust may be accomplished by any of the
following: the exercise of a power of sale under the deed of trust or mortgage,
or by judicial sale under the deed of trust or mortgage, or by judicial
foreclosure. Neither this exercise of self help remedies nor the institution or
maintenance of an action for foreclosure or provisional or ancillary remedies
shall constitute a waiver of the right of any party, including the claimant in
any such action, to arbitrate the merits of the controversy or claim occasioning
resort to such remedies.
IN WITNESS WHEREOF, Guarantor has executed this Guaranty under seal as of
the day and year first above written.
11
Signed, sealed and delivered
in the presence of: TRANSEASTERN PROPERTIES, INC., A FLORIDA
CORPORATION, F/K/A TRANSEASTERN
PROPERTIES OF SOUTH FLORIDA, INC., A
FLORIDA CORPORATION
____________________________________
Witness #1 By________________________________(SEAL)
____________________________________ Xxxxxx Xxxxxxx, Executive Vice President
____________________________________
Print Name
_____________________________________ Address:
Witness #1
0000 Xxxxxxxxxx Xxxxx
_____________________________________ Xxxxx Xxxxxxx, Xxxxxxx 00000
Print Name
STATE OF FLORIDA )
)ss
COUNTY OF BROWARD )
The foregoing instrument was acknowledged before me this ____ day of
September, 1996, by XXXXXX XXXXXXX, as Executive Vice President of TRANSEASTERN
PROPERTIES, INC., a Florida corporation, f/k/a Transeastern Properties of South
Florida, Inc., a Florida corporation by and on behalf the corporation. He is
personally known to me and/or has produced ________________________________ as
identification.
My Commission Expires: ___________________________________________
NOTARY PUBLIC STATE OF FLORIDA
___________________________________________
Print Name
12
Loan No. 91004539
GUARANTY AGREEMENT
THIS GUARANTY AGREEMENT, dated as of September ___, 1996 (the "Guaranty")
is executed by TRANSEASTERN PROPERTIES, INC., A FLORIDA CORPORATION, F/K/A
TRANSEASTERN PROPERTIES OF SOUTH FLORIDA, A FLORIDA CORPORATION (the
"Guarantor"), and extended to CHASE FEDERAL BANK, A FEDERAL SAVINGS BANK, A
DIVISION OF NATIONSBANK, N.A. (SOUTH), a national banking association ("Bank")
for the benefit of TRANSEASTERN PEMBROKE VILLAGES, INC., A FLORIDA CORPORATION,
a Florida limited partnership ("Borrower").
RECITALS:
1. Bank has agreed to extend a loan (the "Loan") to Borrower pursuant to
the terms and conditions of, among other documents, a Promissory Note in the
original principal amount of THREE MILLION AND NO/100 DOLLARS ($3,000,000.00) of
even date herewith executed and delivered by Borrower in favor of Bank (the
"Note") and a Loan Agreement of even date, by and between Borrower and Bank (the
"Loan Agreement") for the construction of up to 114 single family homes in that
certain project known as Egret's Way located in Pembroke Pines, Florida (the
"Mortgaged Property") , which Loan is secured by a Real Estate Mortgage,
Assignment, and Security Agreement of even date filed or to be filed in the
public records of Broward County, Florida (the "Mortgage"), a Hazardous
Substance Certificate and Indemnification Agreement of even date between
Borrower, Guarantor and Bank (the "Indemnity") and other agreements to be
executed by the Borrower and Bank. The Mortgage, this Guaranty, the Indemnity
and the other agreements are hereinafter referred to collectively as the
"Security Documents". The Security Documents and the Loan Agreement are
hereinafter referred to collectively for convenience as the "Loan Documents".
2. Guarantor is a shareholder of TRANSEASTERN PEMBROKE VILLAGES, INC., a
Florida corporation.
3. Without this Guaranty, Bank would be unwilling to make the Loan to
Borrower.
4. Because of the direct benefit to Guarantor from the Loan to Borrower,
and as an inducement to Bank to make the Loan to Borrower, Guarantor agrees to
guarantee to Bank the obligations of Borrower as set forth herein.
NOW, THEREFORE, in consideration of Bank entering into the Loan Agreement
and making the Loan to Borrower, and for other good and valuable consideration
by Borrower to Guarantor, the receipt and sufficiency of which is hereby
acknowledged by Guarantor, Guarantor hereby covenants and agrees as follows:
1. GUARANTY OF PAYMENT. Guarantor hereby unconditionally guarantees to
Bank the
payment, when due, by acceleration or otherwise, of the Indebtedness. For the
purposes hereof, the term "Indebtedness" shall include any and all indebtedness
and obligations of Borrower to Bank, except as the Guarantor's liability is
specifically limited in the Loan Documents, including without limitation, all
principal , interest, fees and expenses, including attorneys' fees, evidenced by
the Note, the Loan Agreement, the Security Documents or otherwise, or arising in
connection with the Loan, whether existing now or arising hereafter, as such
Indebtedness may be modified, increased, extended or renewed from time to time.
The guaranty of Guarantor as set forth in this section is a guaranty of payment
and not of collection.
2. GUARANTY OF PERFORMANCE. Guarantor additionally unconditionally
guarantees to Bank the timely performance of all other obligations of Borrower
under all of the Loan Documents, including, without limiting the generality of
the foregoing, that:
(a) the Improvements will be constructed upon the Land in accordance
with the Loan Agreement and with the Plans; and
(b) the Improvements will be completed and ready for occupancy,
including delivery of any certificates, licenses, and permits required by law or
the Loan Agreement, within the time periods required in the Loan Agreement.
In the event the foregoing obligations of Borrower are not timely performed
in any respect whatsoever, Guarantor, without the necessity of any notice from
Bank to Guarantor, agrees to (i) assume all responsibility for the completion of
the Improvements and, at Guarantor's own cost and expense, to cause the
Improvements to be fully completed in accordance with the Plans and in
accordance with the Loan Agreement; (ii) pay all bills, costs, and expenses in
connection with the construction and completion of the Improvements; and (iii)
indemnify and hold Bank harmless from any and all loss, cost, liability or
expense Bank may suffer by reason of any such acts or omissions of Borrower. If,
after the occurrence of a Default by Borrower, Guarantor has not caused
construction to progress as required by the Loan Agreement, Bank may, at its
option, after first having given notice to the Guarantor at the address set
forth below in the manner prescribed herein for giving notice, complete the
Improvements either before or after commencement of foreclosure proceedings or
before or after any other remedy of Bank against Borrower or Guarantor, with
such changes or modifications in the Plans which Bank reasonably deems necessary
and expend such sums as Bank, in its discretion, reasonably deems necessary and
proper in order to so complete the Improvements, and Guarantor hereby waives any
right to contest any such expenditures. The amount of any and all expenditures
made by Bank for the foregoing purposes shall be due and payable to Bank upon
demand and accrue interest at the rate then applicable under the Note (or that
would be applicable under the Note if it were still outstanding).
3. SUBORDINATION.
3.1 All rights and claims of Guarantor now or hereafter existing
(collectively the "Guarantor Claims") against Borrower or any of Borrower's
property which Borrower now owns
2
or shall acquire in the future or hereafter existing shall be subordinate and
subject in right of payment to the prior payment in full of the Indebtedness to
Bank.
3.2 Until the Indebtedness has been paid in full and Guarantor shall
have performed or satisfied all of its obligations hereunder and provided no
Default exists, Guarantor may receive or collect, directly or indirectly, from
Borrower or any other party any payment upon Guarantor Claims, seek to realize
upon any collateral securing such Guarantor Claims or claim any offset or other
reduction of Guarantor's obligations hereunder because of any Guarantor Claims.
Notwithstanding the foregoing, only if a Default exists, if Guarantor should
receive any such payment, Guarantor agrees to hold same in trust for Bank and
agrees that Guarantor shall have absolutely no rights in or to or dominion over,
such payments except to pay them promptly to Bank without demand by Bank.
4. GUARANTOR WAIVERS. Guarantor hereby waives and agrees not to
assert or take advantage of (a) any right or claim of right to cause a
marshaling of any of Borrower's assets or the assets of any other party now or
hereafter held as security for the Indebtedness; (b) the defense of the statute
of limitations in any action hereunder or for the payment of the Indebtedness
and performance of any obligation hereby guaranteed; (c) any defense that may
arise by reason of the incapacity, lack of authority, death or disability of
Guarantor, any other guarantor of the Loan, or Borrower or any other person or
entity, or the voluntary or involuntary dissolution of Borrower or Guarantor, or
the failure of Bank to file or enforce a claim against the estate (either in
administration, bankruptcy, or any other proceeding) of Borrower or any other
person or entity; (d) any defense based on the failure of Bank to give notice of
the existence, creation, or incurring of any new or additional indebtedness or
obligation, or of any action or nonaction on the part of any other person
whomsoever, or any modification of the terms of the Loan Documents, or the
Indebtedness, in connection with any obligation hereby guaranteed; (e) any
defense based upon an election of remedies by Bank which destroys or otherwise
impairs any subrogation rights of Guarantor or any other guarantor of the Loan
or the right of Guarantor to proceed against Borrower or any other guarantor for
reimbursement, or both; (f) any defense based upon failure of Bank to commence
an action against Borrower; (g) any defense based upon acceptance of this
Guaranty by Bank; (h) any defense based upon the invalidity or unenforceability
of any of the Loan Documents; (i) any defense based upon any limitation of
liability contained in any of the Loan Documents unless specifically set forth
therein; (j) any defense based upon any transfer by Borrower of all or any part
of the Collateral; (k) any defense based upon the failure of Bank to perfect any
security or to extend or renew the perfection of any security; and (l) any other
legal or equitable defenses whatsoever to which Guarantor might otherwise be
entitled.
5. CONSENT TO BANK'S ACTIONS OR INACTIONS. Guarantor consents that
Bank may, at any time and from time to time, before or after any Default by
Borrower, without affecting the liability of Guarantor hereunder and with or
without further notice to or assent from Guarantor:
5.1 Either with or without consideration to Borrower or to any
guarantor guaranteeing the completion of the Project or payment of any portion
of the Indebtedness, or any pledgor or
3
grantor of any collateral, exchange, release or surrender (in whole or in part),
or fail to protect or to preserve the value of any collateral now or hereafter
held as security for the Loan, or waive, release or subordinate any lien or
security interest (in whole or in part) in or on any such collateral;
5.2 Waive or delay the exercise of any of its rights or remedies
against Borrower or any other person or entity, including without limitation,
any guarantor guaranteeing the completion of the Project or payment of any
portion of the Indebtedness; notwithstanding any waiver or delay, Bank shall not
he precluded from further exercise of any of its rights, powers or privileges
expressly provided for herein or otherwise available, it being understood that
all such rights and remedies are cumulative;
5.3 Waive or extend the time from Borrower's or any other guarantor's
performance of any and all terms, provisions and conditions set forth in the
Loan Documents;
5.4 Release Borrower or any other person or entity, including without
limitation any other guarantor guaranteeing the completion of the Project or
payment of any portion of the Indebtedness, from their obligations to complete
the Project and/or from their obligations to repay all or any portion of the
Indebtedness;
5.5 Proceed against Guarantor without first proceeding against or
joining Borrower or any other guarantor guaranteeing the completion of the
Project or payment of any portion of the Indebtedness or any endorser of the
Note, or any property securing the payment of the Indebtedness;
5.6 Renew, extend or modify the terms of the Loan or any instrument
or agreement evidencing, securing, or relating to the Loan;
5.7 Generally deal with Borrower or other person or party or any
Collateral as Bank may see fit; and
5.8 Consent to any change in the Plans and/or the Improvements.
Guarantor shall remain bound under this Guaranty notwithstanding any
such exchange, release, surrender, subordination, waiver (whether or not such
waiver is oral or written), delay, proceeding, renewal, extension, modification,
act or failure to act, or other dealings described in Subsections 5.1 through
5.8 above, inclusive, including without limitation, any change in the Plans
and/or the Improvements even though done without notice to or consent from
Guarantor.
6. WAIVER OF NOTICE. Guarantor waives all notices whatsoever with
respect to the Loan Documents, including without limitation, this Guaranty, and
with respect to the Loan, including, but not limited to, notice of:
6.1 Bank's acceptance of this Guaranty or its intention to act, or
its action, in reliance
4
hereon;
6.2 The making of the Loan by Bank to Borrower;
6.3 Presentment and demand for payment of the Loan or any portion
thereof;
6.4 Protest and notice of dishonor or non-payment with respect to the
Loan or any portion thereof;
6.5 Any Default by Borrower or any pledgor, grantor of security, or
any other guarantor guaranteeing the completion of the Project and/or payment of
any portion of the Indebtedness;
6.6 Any other notices to which Guarantor may otherwise be entitled;
and
6.7 Any demand for payment under this Guaranty.
7. PRIMARY LIABILITY OF GUARANTOR. Guarantor agrees that this
Guaranty may be enforced by Bank without the necessity at any time of resorting
to or exhausting any other security or collateral and without the necessity at
any time of having resorted to recourse to the Note or the Collateral through
foreclosure proceedings under the Security Documents or otherwise, and Guarantor
hereby waives any rights to require Bank to proceed against Borrower or any
other guarantor or to require Bank to pursue any other remedy or enforce any
other right. Guarantor further agrees that Guarantor shall have no right of
subrogation, reimbursement or indemnity whatsoever, nor any right of recourse to
security for the Indebtedness or Borrower to Bank, unless and until all of the
Indebtedness of Borrower to Bank has been paid in full. Guarantor further agrees
that nothing contained herein shall prevent Bank from suing on the Note or
foreclosing the Mortgage or from exercising any other rights available to it
under any other Loan Documents, or any other instrument of security if there is
a Default by Borrower or Guarantor , and the exercise of any of the aforesaid
rights and the completion of any foreclosure proceedings shall not constitute a
discharge of any of Guarantor's obligations hereunder; it being the purpose and
intent of Guarantor that Guarantor's obligations hereunder shall be absolute,
independent and unconditional under any and all circumstances. Neither
Guarantor's obligations under this Guaranty nor any remedy for the enforcement
thereof shall be impaired, modified, changed or released in any manner
whatsoever by an impairment, modification, change, release or limitation of the
liability of Borrower or any other guarantor or by reason of Borrower's or any
other guarantor's bankruptcy, insolvency, death, or dissolution. At any time
Bank is entitled to exercise its remedies hereunder, it may in its discretion
elect to demand payment or performance. In the event Bank elects to demand
performance, it shall at all times thereafter have the right to demand payment
until all of the Indebtedness has been paid in full. In the event Bank elects to
demand payment, it shall at all times thereafter have the right to demand
performance until all of the Indebtedness has been paid in full.
5
8. SUBROGATION RIGHTS. Until the Loan is paid in full, Guarantor
will not assert any right to which it may be or may become entitled, whether by
subrogation, contribution or otherwise, against Borrower (except Guarantor's
right to receive a management fee and distribution of cash flow from Borrower
for so long as no Default exists) or any other guarantor guaranteeing the
completion of the Project or payment of any portion of the Indebtedness or
against any of their respective properties, by reason of the performance by
Guarantor of its obligations under this Guaranty, except after completion of the
Project and payment in full of the Indebtedness in accordance with the Loan
Agreement.
9. COST OF ENFORCEMENT. In the event that the Note or this Guaranty
are not paid when due after any applicable grace period on any stated or
accelerated maturity date, or should it be necessary for Bank to enforce any
other of its rights under the Loan Documents, Guarantor will pay to Bank, in
addition to principal, interest and other charges due hereunder or under the
other Loan Documents, all costs of collection or enforcement, including
reasonable attorneys' fees, paralegals' fees, legal assistants' fees, costs and
expenses, whether incurred with respect to collection, arbitration, litigation,
bankruptcy proceedings, interpretation, dispute, negotiation, trial, appeal,
defense of actions instituted by a third party against Bank arising out of or
related to the Loan, enforcement of any judgment based on this Guaranty, or
otherwise, whether or not a suit to collect such amounts or to enforce such
rights is brought or, if brought, is prosecuted to judgment.
10. GRANT. INTENTIONALLY DELETED
11. TERM OF GUARANTY; WARRANTIES. This Guaranty shall continue in
full force and effect until the Indebtedness is fully paid, and all obligations
of Borrower and Guarantor are performed and discharged. This Guaranty covers the
Indebtedness whether presently outstanding or arising subsequent to the date
hereof including all amounts advanced by Bank in stages or installments.
Guarantor warrants and represents to Bank, (i) that this Guaranty is binding
upon and enforceable against Guarantor, its heirs, personal representatives,
executors, successors, and assigns in accordance with its terms, (ii) that the
execution and delivery of this Guaranty do not violate any applicable laws or
constitute a breach of any agreement to which Guarantor is a party, (iii) that
there is no litigation, claim, action or proceeding pending or, to the best
knowledge of Guarantor, threatened against Guarantor which would adversely
affect the financial condition of Guarantor or its ability to fulfill its
obligations hereunder. Guarantor agrees to promptly inform Bank of the adverse
determination of any litigation, claim, action or proceeding or the institution
of any litigation, claim, action or proceeding against Guarantor which does or
could adversely affect the financial condition of Guarantor or its ability to
fulfill its obligations hereunder.
12. FURTHER REPRESENTATIONS AND WARRANTIES. Guarantor further
represents to Bank that Guarantor has knowledge of Borrower's financial
condition and affairs and represents and agrees that it will keep so informed
while this Guaranty is in force. Guarantor agrees that Bank has no present or
future obligation to investigate the financial condition or affairs of Borrower
for the benefit of Guarantor nor to advise Guarantor of any fact respecting, or
any change in,
6
the financial condition or affairs of Borrower or any other guarantor of the
Loan which might come to the knowledge of Bank at any time, whether or not Bank
knows or believes or has reason to know or believe that any such fact or change
is unknown to Guarantor or might (or does) increase the risk of Guarantor as
guarantor or might (or would) affect the willingness of Guarantor to continue as
a guarantor with respect to the Indebtedness.
13. FINANCIAL STATEMENTS. Guarantor shall submit annual financial
statements to Bank within one hundred twenty (120) days of each June 30th of the
Loan, and interim financial statements to Bank within thirty (30) days after
Bank has requested same in writing. The statements shall include, at a minimum,
the following current items: a balance sheet, an income and expense statement, a
statement showing contingent liabilities, detailed information regarding project
sales and construction status on each project and/or entity in which Guarantor
has an interest and any supporting schedules or documentation which Bank may
require. Such detailed statements shall include, as applicable, the project
name, location, percentage of Guarantor's ownership interest, leasing status,
net operating income, current loan balance, debt service, source of any
operating deficit, amount of and beneficiary of any cash distributions, and the
amount of cash invested in or received from that enterprise. Each statement
shall bear an authorized signature attesting to the accuracy of the statement.
Annual statements of business entities shall be audited and bear the unqualified
opinion of an acceptable certified public accountant. Guarantor shall also
provide Bank with current year personal tax returns within thirty (30) days of
filing.
14. ADDITIONAL LIABILITY OF GUARANTOR. If Guarantor is or becomes
liable for any indebtedness owing by Borrower to Bank by endorsement or
otherwise than under this Guaranty, such liability shall not be in any manner
impaired or reduced hereby but shall have all and the same force and effect it
would have had if this Guaranty had not existed and Guarantor's liability
hereunder shall not be in any manner impaired or reduced thereby.
15. CUMULATIVE RIGHTS. All rights of Bank hereunder or otherwise
arising under any documents executed in connection with or as security for the
Indebtedness are separate and cumulative and may be pursued separately,
successively or concurrently, or not pursued without affecting, reducing or
limiting any other right of Bank and without affecting, reducing or impairing
the liability of Guarantor.
16. MULTIPLE COUNTERPARTS; PRONOUNS; CAPTIONS; SEVERABILITY. This
Guaranty may be executed in multiple counterparts, each of which shall be deemed
an original but all of which shall constitute but one and the same document. The
pronouns used in this instrument shall be construed as masculine, feminine or
neuter as the occasion may require. Use of the singular includes the plural, and
vice versa. Captions are for reference only and in no way limit the terms of
this Guaranty. Invalidation of any one or more of the provisions of this
Guaranty shall in no way affect any of the other provisions hereof, which shall
remain in full force and effect. Use of the term "include" or "including" is
always without limitation. "Person" or "party" means any natural person or
artificial entity having legal capacity.
7
17. BANK ASSIGNS. This Guaranty is intended for and shall inure to
the benefit of Bank and each and every person who shall from time to time be or
become the owner or holder of any document evidencing or securing the
Indebtedness, and each and every reference herein to Bank shall include and
refer to each and every successor or assignee of Bank at any time holding or
owning any part of or interest in any part of the Indebtedness. This Guaranty
shall be transferable and negotiable with the same force and effect, and to the
same extent, that any document evidencing or securing all or any portion of the
Indebtedness is transferable and negotiable, it being understood and stipulated
that upon assignment or transfer by Bank of any of the Indebtedness, the legal
holder or owner of said Indebtedness (or a part thereof or interest therein thus
transferred or assigned by Bank) shall (except as otherwise stipulated by Bank
in its assignment) have and may exercise all of the rights granted to Bank under
this Guaranty to the extent of that part of or interest in the Indebtedness thus
assigned or transferred to said person. Guarantor expressly waives notice of
transfer or assignment of the Indebtedness, or any part thereof, or of the
rights of Bank hereunder. Failure to give notice will not affect the liabilities
of Guarantor hereunder. Bank may sell or offer to sell the Loan or interests in
the Loan to one or more assignees or participants and may disclose to any such
assignee or participant or prospective assignee or participant any information
Lender has pertaining to the Guaranteed Obligations, this Guaranty, or
Guarantor, including, without limitation, information regarding any security for
the Guaranteed obligations or any other party liable, directly or indirectly,
for any part of the Guaranteed Obligations. Bank may also disclose any such
information to any regulatory body having jurisdiction over Bank.
18. APPLICATION OF PAYMENTS. Bank may apply any payments received by
it from any source against that portion of the Indebtedness (principal,
interest, court costs, attorneys' fees or other) in such priority and fashion as
it may deem appropriate.
19. NOTICES. Any notice or demand that must or may be given or made
in connection with this Guaranty must be in writing and, unless receipt is
expressly required, will be deemed given, delivered or made, as the case may be,
when delivered by personal delivery or the day after it is mailed by Express
Mail, by overnight delivery service of a nationally-recognized company,
addressed to the parties at the following addresses, or such other addresses as
may from time to time be designated by written notice given as herein required:
to Guarantor:
Xxxxxx Xxxxxxx
Transeastern Pembroke Villages, Inc.
0000 Xxxxxxxxxx Xxxxx, Xxxxx Xxxxxxx, XX 00000
to Bank:
NationsBank of Florida, N.A.
000 X. Xxxxxxx Xxxxx Xxxx, Xxxxx 000
Xxxx Xxxxxxxxxx, XX 00000
Attention: Xxx Xxxx, Vice President
8
Personal delivery to a party or to any officer, partner, agent or employee of
such party, or if a proper person, to a member of his family, at its address
herein shall constitute receipt. Rejection or other refusal to accept or
inability to deliver because of changed address of which no notice has been
received shall also constitute receipt. Notwithstanding the foregoing, no notice
of change of address shall be effective until the date of receipt thereof. This
section shall not be construed in any way to affect or impair any waiver of
notice or demand herein provided or to require giving of notice or demand to or
upon Guarantor in any situation or for any reason.
20. CONFLICT OF LAW. This Guaranty shall be construed, interpreted,
enforced and governed by and in accordance with the laws of the State of
Florida.
21. SUBMISSION TO JURISDICTION. Guarantor irrevocably and
unconditionally (a) agrees that any suit, action or other legal proceeding
arising out of or relating to this Guaranty may be brought, at the option of
Bank, in a court of competent jurisdiction of the State of Florida or any United
States District Court in Florida; (b) consents to the jurisdiction of each such
court in any such suit, action or proceeding; (c) waives any and all personal
rights under the laws of any state to object to the laying of venue of any such
suit, action or proceeding in the State of Florida; and (d) agrees that service
of any court paper may be effected on Guarantor by mail, addressed and mailed as
provided in Section 19 hereof or in such other manner as may be provided under
applicable laws or court rules in the State of Florida. Nothing contained
herein, however, shall prevent Bank from bringing an action or exercising any
rights against any security for the Loan or against Guarantor personally, and
against any property of Guarantor, within any other state. Initiating such
proceeding or taking such action in any other state shall in no event constitute
a waiver of the agreement contained herein that the law of the State of Florida
shall govern the rights and obligations of Guarantor and Bank hereunder or of
the submission herein made by Guarantor to personal jurisdiction within the
State of Florida. The aforesaid means of obtaining personal jurisdiction and
perfecting service of process are not intended to be exclusive but are
cumulative and in addition to all other means of obtaining personal jurisdiction
and perfecting service of process now or hereafter provided by the law of the
State of Florida.
22. WAIVER OF HOMESTEAD. Guarantor waives any and all homestead and
exemption rights which it may have under or by virtue of the Constitution or the
laws of the United States of America or of any state as against this Guaranty,
any renewal hereof, or any indebtedness represented hereby, and does jointly and
severally transfer, convey, and assign to Bank a sufficient amount of such
homestead or exemption as may be allowed, including such homestead or exemption
as may be set apart in bankruptcy, to pay all amounts due hereunder in full,
with all costs of collection, and does hereby direct any trustee in bankruptcy
having possession of such homestead or exemption to deliver to Bank a sufficient
amount of property or money set apart as exempt to pay the indebtedness
guaranteed hereby, or any renewal thereof, and does hereby appoint Bank the
attorney-in-fact for each of them, to claim any and all homestead
9
exemptions allowed by law.
23. CONTINUING LIABILITY. Notwithstanding any other provisions of
this Guaranty, the Indebtedness shall be deemed to include any and all
liability, damage, cost and expense, including reasonable attorneys' fees,
paralegals' fees and legal assistants' fees, which may hereafter be incurred by
Bank as a result of the Mortgaged Property:
(a) having been used in the past or present or being used in the
future while the Mortgaged Property is owned by Borrower, for the sale,
handling, storage, transportation, or disposal of hazardous or toxic materials,
in violation of any Governmental Requirements in effect from time to time
regulating hazardous or toxic materials or the Mortgaged Property; or
(b) having contained or hereafter containing, while the Mortgaged
Property is owned by Borrower, asbestos or products containing asbestos in
violation of any laws, ordinances, or regulations of any Governmental
Authorities affecting asbestos or products containing asbestos or the Mortgaged
Property.
Except as Guarantor's liability is specifically limited in the Loan
Documents, it is expressly acknowledged by Guarantor that this indemnification
shall survive in accordance with the terms and conditions set forth in the
Hazardous Substance Certificate and Indemnification Agreement of even date
herewith executed by the Guarantor and Borrower.
24. DISCLOSURE OF BORROWER AND GUARANTOR FINANCIAL INFORMATION. Bank
may sell or offer to sell the Loan or interests in the Loan to one or more
assignees or participants and may disclose to any such assignee or participant
or prospective assignee or participant any information Bank has pertaining to
the Loan Documents, this Guaranty, or Guarantor, including, without limitation,
information regarding any security for the Loan Documents or for this Guaranty,
credit information on Guarantor, Borrower, and/or any other party liable,
directly or indirectly, for any part of the Loan Documents. Bank may also
disclose any such information to any regulatory body having jurisdiction over
Bank.
25. ORAL MODIFICATION INEFFECTIVE. This Guaranty may not be changed
orally, and no obligation of Guarantor can be released or waived by Bank or any
officer or agent of Bank, except by a writing signed by a duly authorized
officer of Bank. This Guaranty shall be irrevocable by Guarantor until the
Indebtedness has been completely repaid and all obligations and undertakings of
Borrower under, by reason of, or pursuant to the Loan Documents have been
completely performed, at which time Bank will terminate this Guaranty. This
Guaranty shall continue in full force and effect unless and until discharged or
released by Bank pursuant to a written instrument properly executed by an
appropriate officer of Bank. This Guaranty shall continue in full force and
effect unless and until discharged or released by Bank pursuant to a written
instrument properly executed by an appropriate officer of Bank.
26. REFERENCE TO OTHER LOAN DOCUMENTS. All of the terms, definitions,
conditions and covenants of the Loan Agreement, the Note, the Mortgage, and the
Assignment are expressly
10
made a part of this Guaranty by reference in the same manner and with the same
effect as if set forth herein at length and shall have the meaning set forth in
the Loan Agreement, the Note, the Mortgage, and the Assignment unless otherwise
defined herein.
27. MANDATORY ARBITRATION. Any controversy or claim between or among
the parties hereto including, but not limited to, those arising out of or
relating to this Agreement or any related agreements or instruments, including
any claim based on or arising from an alleged tort, shall be determined by
binding arbitration in accordance with the Federal Arbitration Act (or if not
applicable, the applicable state law), the Rules of Practice and Procedure for
the Arbitration of Commercial Disputes of Judicial Arbitration and Meditations
Services, Inc. (J.A.M.A.S.), and the "Special Rules" set forth below. In the
event of any inconsistency, the Special Rules shall control. Judgment upon any
arbitration award may be entered in any court having jurisdiction. Any party to
this Agreement may bring an action, including a summary or expedited proceeding,
to compel arbitration of any controversy or claim to which this Agreement
applies in any court having jurisdiction over such action.
(a) Special Rules: The arbitration shall be conducted in Broward
County, Florida and administered by Endispute, Inc., d/b/a J.A.M.S./Endispute
who will appoint an arbitrator; if J.A.M.S./Endispute is unable or legally
precluded from administering the arbitration, then the American Arbitration
Association will serve. All arbitration hearings will be commenced within 90
days of the demand for arbitration; further, the arbitrator shall only, upon a
showing of cause, be permitted to extend the commencement of such hearing for up
to an additional 60 days.
(b) Reservations of Rights: Nothing in this Agreement shall be
deemed to (i) limit the applicability of any otherwise applicable statutes of
limitation or repose and any waivers contained in this Agreement; or (ii) be a
waiver by the Bank of the protection afforded to it by 12 U.S.C. Section 91 or
any substantially equivalent state law; or (iii) limit the right of the Bank
hereto (A) to exercise self help remedies such as (but not limited to) setoff,
or (B) to foreclose against any real or personal property collateral, or (C) to
obtain from a court provisional or ancillary remedies such as (but not limited
to) injunctive relief or the appointment of a receiver. The Bank may exercise
such self help rights, foreclose upon such property, or obtain such provisional
or ancillary remedies before, during or after the pendency of any arbitration
proceeding brought pursuant to this Agreement. At Bank's option, foreclosure
under a mortgage or deed of trust may be accomplished by any of the following:
the exercise of a power of sale under the deed of trust or mortgage, or by
judicial sale under the deed of trust or mortgage, or by judicial foreclosure.
Neither this exercise of self help remedies nor the institution or maintenance
of an action for foreclosure or provisional or ancillary remedies shall
constitute a waiver of the right of any party, including the claimant in any
such action, to arbitrate the merits of the controversy or claim occasioning
resort to such remedies.
IN WITNESS WHEREOF, Guarantor has executed this Guaranty under seal as of
the day and year first above written.
11
Signed, sealed and delivered
in the presence of: TRANSEASTERN PROPERTIES, INC., A FLORIDA
CORPORATION, F/K/A TRANSEASTERN PROPERTIES
OF SOUTH FLORIDA, INC., A FLORIDA
CORPORATION
____________________________________
Witness #1 By_________________________________(SEAL)
____________________________________ Xxxxxx Xxxxxxx, Executive Vice President
____________________________________
Print Name
____________________________________ Address:
Witness #1
0000 Xxxxxxxxxx Xxxxx
____________________________________ Xxxxx Xxxxxxx, Xxxxxxx 00000
Print Name
STATE OF FLORIDA )
)ss
COUNTY OF BROWARD )
The foregoing instrument was acknowledged before me this ____ day of
September, 1996, by XXXXXX XXXXXXX, as Executive Vice President of TRANSEASTERN
PROPERTIES OF SOUTH FLORIDA, INC., a Florida corporation, by and on behalf the
corporation. He is personally known to me and/or has produced
________________________________ as identification.
My Commission Expires: ___________________________________________
NOTARY PUBLIC STATE OF FLORIDA
___________________________________________
Print Name
12
This Instrument Prepared by:
Xxxxxxx X. Xxxx, Esq.
Xxxxxxx Xxxxxxx & Xxxxx Xxxxx
0000 Xxxxxxx Xxxx, Xxx. 000
Xxxxx Xxxxx, Xxxxxxx 00000
Loan No. 91004539
REAL ESTATE MORTGAGE, ASSIGNMENT,
AND SECURITY AGREEMENT,
(THE "MORTGAGE")
DATE: September ___, 1996
BORROWER:
TRANSEASTERN PEMBROKE VILLAGES, INC., A FLORIDA CORPORATION
0000 Xxxxxxxxxx Xxxxx
Xxxxx Xxxxxxx, Xxxxxxx 00000
BANK:
CHASE FEDERAL BANK, A FEDERAL SAVINGS BANK, A DIVISION OF
NATIONSBANK, N.A. (SOUTH), a national banking association 000
Xxxx Xxxxxxx Xxxxx Xxxx
Xxxxx 000
Xxxx Xxxxxxxxxx, XX 00000
AMOUNT OF INITIAL LOAN SECURED HEREBY: $3,000,000.00
MAXIMUM POSSIBLE PRINCIPAL DEBT, INCLUDING FUTURE ADVANCES, THAT MAY BE SECURED
HEREBY: $6,000,000.00
LAND: That certain parcel of Land commonly referred to as Parcel "F" -
"Egret's Way" located within the NASHER PLAT as recorded in Plat Book
159 at Page 42, of the Public Records of Broward County, Florida, and
as particularly described on Exhibit "A" attached hereto and
incorporated herein by reference.
1. MORTGAGE. In consideration of Ten Dollars ($10.00) and other
valuable consideration received by Borrower, the receipt and sufficiency of
which are hereby acknowledged, Borrower hereby grants, bargains, sells, assigns,
transfers, conveys and mortgages to Bank, its successors and assigns, to its own
proper use and benefit forever, subject to the terms and conditions of this
Mortgage, the real estate described above as the Land, together with:
a. APPURTENANCES. The benefit of all easements and other rights
of any nature whatsoever, if any, appurtenant to the Land or the
Improvements, or both, the benefit of all rights-of- way, strips and
gores of land, streets, alleys, passages, drainage rights, sanitary
sewer and potable water rights, stormwater drainage rights, rights of
ingress and egress to the Land and all adjoining property, and any
improvements of Borrower now or hereafter located on any of such real
property interests, water rights and powers, oil, gas, mineral and
riparian and littoral rights, whether now existing or hereafter
arising, together with the
reversion or reversions, remainder or remainders, rents, issues,
incomes and profits of any of the foregoing (the "Appurtenances").
b. IMPROVEMENTS. All buildings, structures, betterments and
other improvements of any nature now or hereafter situated in whole or
in part upon the Land or on the Appurtenances, regardless of whether
physically affixed thereto or severed or capable of severance therefrom
(the "Improvements").
c. TANGIBLE PROPERTY. All of Borrower's right, title and
interest, if any, in and to all fixtures, equipment and tangible
personal property of any nature whatsoever that is now or hereafter (i)
attached or affixed to the Land, the Appurtenances, or the
Improvements, or (ii) situated upon or about the Land, the
Appurtenances and/or the Improvements, regardless of whether physically
affixed thereto or severed or capable of severance therefrom, or (iii)
used, regardless of where situated, if used, usable or intended to be
used, in connection with any present or future use or operation of or
upon the Land. The foregoing includes: all goods and inventory, all
heating, air conditioning, lighting, incinerating and power equipment;
all engines, compressors, pipes, pumps, tanks, motors, conduits,
wiring, and switchboards; all plumbing, lifting, cleaning, fire
prevention, fire extinguishing, refrigerating, ventilating, and
communications and public address apparatus; all signage and
recreational amenities including, without limitation, swimming pools,
exercise equipment, tennis courts, clubhouse furnishings or saunas; all
boilers, furnaces, oil burners, vacuum cleaning systems, elevators and
escalators; all stoves, ovens, ranges, disposal units, dishwashers,
water heaters, exhaust systems, refrigerators, cabinets, and
partitions; all rugs, draperies and carpets; all laundry equipment; all
building materials; all furniture (including, without limitation, any
outdoor furniture) , furnishings, office equipment and office supplies;
and all additions, accessions, renewals, replacements and substitutions
of any or all of the foregoing. The property interests encumbered and
described by this paragraph are called the "Tangible Property" in this
Mortgage.
d. All rents, issues, incomes and profits in any manner arising
from the Land, Improvements, Appurtenances or Tangible Property, or any
combination thereof, including Borrower's interest in and to all leases
of whatsoever kind or nature, licenses, franchises and concessions of
or relating to all or any portion of the Land, Appurtenances,
Improvements or Tangible Property,or the operation thereof, whether now
existing or hereafter made, including all amendments, modifications,
replacements, substitutions, extensions, renewals or consolidations
thereof. The property interests encumbered and described in this
subparagraph are called the "Rents" in this Mortgage.
e. SECONDARY FINANCING. All of the Borrower's rights, power or
privilege to further encumber any of the Collateral described in this
paragraph 1, it being intended by this provision to divest Borrower of
the power to encumber or to grant a security interest in any of the
Collateral as security for the performance of an obligation, except for
"Permitted Encumbrances," as defined in paragraph 5 herein.
f. PROCEEDS. All proceeds of the conversion, voluntary or
involuntary, of any of the property encumbered by this Mortgage into
cash or other liquidated claims, or that are otherwise payable for
injury to or the taking or requisitioning of any such property,
including all judgments, settlements and insurance and condemnation
proceeds as provided in this Mortgage.
g. CONTRACT RIGHTS. All of Borrower's right, title and interest
in and to any and all contracts or leases, written or oral, express or
implied, now existing or hereafter entered into or arising, in any
matter related to the improvement, use, operation, sale, conversion or
other disposition of any interest in the Land, Appurtenances,
Improvements, Tangible Property or the Rents, or any combination
thereof, including all tenant leases, sales contracts, payments due and
to become due thereunder; and including, without limitation, contracts
pertaining to maintenance, on-site security service, elevator
maintenance, landscaping services, building or project management,
marketing, leasing, sale and janitorial services; Borrower's interest
as lessee in equipment leases, including telecommunications, computers,
2
vending machines, model furniture, televisions, laundry equipment; and
Borrower's interests in construction contracts or documents (including
architectural and engineering drawings and plans and specifications
relating to the Improvements), service contracts, use and access
agreements, advertising contracts and purchase orders. The property
interest encumbered and described in this paragraph are called the
"Contract Rights" in this Mortgage. Notwithstanding the foregoing, Bank
will not be bound by any of Borrower's obligations under any of the
foregoing contracts unless and until Bank elects to assume any of such
contracts or leases in writing.
h. NAME. All right, title and interest of Borrower in and to all
trade names, project names, logos, service marks, trademarks, goodwill,
and slogans now or hereafter used in connection with the operation of
the Mortgaged Property except the name of Transeastern Properties,
Inc., a Florida corporation, f/k/a Transeastern Properties of South
Florida, Inc., a Florida corporation.
i. OTHER INTANGIBLES. All contract rights, commissions, money,
deposits, certificates of deposit, letters of credit, documents,
instruments, chattel paper, accounts, and general intangibles [as such
terms from time to time are defined in the Uniform Commercial Code as
adopted by the State of Florida (the "Uniform Commercial Code"], in any
manner related to the construction, use, operation, sale, conversion or
other disposition (voluntary or involuntary) of the Land, Appurtenanc-
es, Improvements, Tangible Property or Rents, including all
construction plans and specifications, architectural plans, engineering
plans and specifications, permits, governmental or quasi-governmental
approvals, licenses, developer rights, vested rights under any Planned
Unit Development or Development of Regional Impact or other project,
zoning, or land use approval, insurance policies, rights of action and
other choses in action.
The Land, Appurtenances, Improvements and Tangible Property are
collectively referred to as the "Mortgaged Property" in this Mortgage.
The portion of the property encumbered by this Mortgage that from time
to time consists of intangible personal property, except for the Rents,
is called the "Intangible Property" in this Mortgage. The Mortgaged
Property, Rents, Intangible Property and any other property interests
encumbered hereby are hereinafter referred to collectively as the
"Collateral". Wherever used in this Mortgage, the use of the terms,
"Mortgaged Property," "Rents", "Intangible Property", and "Collateral"
means and includes all or any portion thereof applicable to the
context.
Notwithstanding the grant of Borrower's interest in the Rents and
Contract Rights above, so long as no Default shall exist hereunder or
under any of the other Loan Documents, Borrower shall have a license to
collect and receive all incomes arising from the operation, ownership,
and maintenance of the Mortgaged Property, Rents and Contract Rights,
but not more than one (1) month prior to accrual.
2. SECURITY AGREEMENT. To the extent any of the Collateral
encumbered by this Mortgage from time to time constitutes personal property
subject to the provisions of the Uniform Commercial Code, this Mortgage
constitutes a "Security Agreement" for all purposes under the Uniform Commercial
Code. Without limitation, Bank, at its election, upon the occurrence of a
Default under this Mortgage, will have all rights, powers, privileges and
remedies from time to time available to a secured party under the provisions of
the Uniform Commercial Code with respect to the Collateral. The names and
addresses of debtor and secured party are as shown for Borrower and Bank,
respectively, on the signature pages hereof. The remedies for any Default under
the covenants, terms, and conditions of the security agreement herein contained
shall be (i) as prescribed herein, or (ii) as prescribed by general law, or
(iii) as prescribed by the specific statutory provisions now or hereafter
enacted and specified in the Uniform Commercial Code, all at Bank's sole
election. Borrower and Bank agree that the filing of financing statements in the
records normally having to do with personal property shall never be construed as
in anywise derogating from or impairing this declaration and hereby stated
intention of Borrower and Bank that everything used in connection with the
production of income from the Collateral or adapted for use therein or which is
described or reflected in this Mortgage, is, and at all times and for all
purposes and in all proceedings
3
both legal or equitable shall be, regarded as part of the real estate
irrespective of whether (i) any such item is physically attached to the
Improvements, (ii) serial numbers are used for the better identification of
certain items capable of being thus identified in a recital contained herein, or
(iii) any such item is referred to or reflected in any financing statement(s) so
filed at any time. Similarly, the mention in any financing statement of the
rights in, or the proceeds of, any fire, hazard or liability insurance policy,
or any award in eminent domain proceedings for a taking or for loss of value, or
Borrower's interest as lessor in any present or future lease, or rights to
income growing out of the use of the Mortgaged Property, whether pursuant to a
lease or otherwise, shall not be construed as altering any of Bank's rights as
determined by this Mortgage, or otherwise available at law or in equity, or
impugning the priority of this Mortgage or the Loan Documents, or both, but such
mention in any financing statement is declared to be for Bank's protection if,
as, and when any court holds that notice of Bank's priority of interest, to be
effective against a particular class of persons, including the federal
government and any subdivisions or entities of the federal government, must be
perfected in the manner required by the Uniform Commercial Code.
Borrower covenants and agrees that Borrower will furnish Bank with
notice of any change in name, identity, organizational structure, mailing
address, residence, or principal place of business thirty (30) days prior to the
effective date of any such change. Borrower will promptly execute any financing
statements or other instruments deemed necessary by Bank to prevent any filed
financing statement from becoming misleading or losing its perfected status or
to reinstate any lapsed financing statement.
3. AFTER-ACQUIRED PROPERTY. Without the necessity of any further act
of Borrower or Bank, the lien of and security interest created by this Mortgage
automatically will extend to and include (i) any and all renewals, replacements,
substitutions, accessions, proceeds, products, additions or after-acquired
property or to the Collateral, and (ii) any and all monies, proceeds and other
property that from time to time, either by delivery to Borrower or by any
instrument (including this Mortgage) may be subjected to such lien and security
interest by Borrower or by anyone on behalf of Borrower, or with the consent of
Borrower, or which otherwise may come into the possession or otherwise be
subjected to the control of Bank or Borrower pursuant to this Mortgage or the
other Loan Documents.
4. DEBT. Borrower is justly indebted to Bank in the principal amount
indicated above (or so much as may be advanced to Borrower by Bank from time to
time), as evidenced by that certain Promissory Note in the original principal
amount of THREE MILLION AND NO/100 DOLLARS ($3,000,000.00), of even date
herewith, made by Borrower, payable to the order of Bank and maturing as stated
in said Notes, unless such maturity is accelerated or extended (as provided in
said Notes) , which Notes, together with any and all renewals, replacements,
extensions, modifications, substitutions, future advances, and any and all other
certificates or evidence of indebtedness evidenced by said Notes are herein
called the "Note".
Borrower's obligations described below are secured, among other things,
by the collateral described in this Mortgage, which term includes any and all
amendments, extensions, renewals, replacements, substitutions, modifications and
consolidations of this Mortgage, and may also from time to time be secured by
other collateral described in written documents. The Mortgage and such other
documents as may exist on the date hereof or may exist hereafter are referred to
as the "Security Documents," which term, as defined in the Note, includes any
and all financing statements, letters of credit, assignments, agreements, any
and all amendments, modifications, extensions, renewals, replacements,
substitutions and consolidations thereof or thereto. The Security Documents, the
Note and the Loan Agreement between Borrower and Bank are referred to
collectively as the "Loan Documents". The Loan evidenced by the Note and secured
by this Mortgage is to be disbursed in accordance with the terms and provisions
of a Loan Agreement of even date herewith between Borrower and Bank (the "Loan
Agreement"). The Note, the Mortgage and the Loan Agreement shall always be taken
and read together as constituting part of one transaction. All sums disbursed
pursuant to the terms of the Loan Agreement shall be secured by this Mortgage
with the same priority as if advanced on the date hereof.
4
The obligations of Borrower secured by the Security Documents arising
pursuant to the Loan Documents are as follows and are called the "Debt" in this
Mortgage and the other Loan Documents:
a. NOTE. Borrower's payment of all sums due from time to time as
evidenced by the Note; and
b. LOAN DOCUMENTS. Borrower's payment or performance of all
obligations imposed upon Borrower by the Loan Documents; and
c. ADVANCES. All sums advanced by Bank to or for the benefit of
Borrower in the manner provided in the Loan Documents, or for the
protection of the Security of the Collateral, including, without
limitation, all sums advanced pursuant to this Mortgage, including
advances for repairs, maintenance, insurance, taxes, or assessments;
and
d. COSTS. All costs, expenses, losses, damages and other charges
sustained or incurred by Bank because of: (i) Borrower's Default in
payment or performance, as the case may be, of any provision contained
in the Loan Documents; (ii) defense of actions instituted by Borrower
or a third party against Bank arising out of or related to the Loan, or
in the realizing upon, protecting, perfecting, defending, or (iii)
actions brought or defended by Bank enforcing Bank's security interest
in the Collateral. All of these costs and expenses include reasonable
attorneys' fees, paralegals' fees, or legal assistants' fees, whether
incurred with respect to collection, litigation, bankruptcy proceedings
interpretation dispute, negotiation, trial, appeal, defense of actions
instituted by a third party against Bank, or enforcement of any
judgment based on the Loan Documents, whether or not suit is brought to
collect such amounts or to enforce such rights or, if brought, is
prosecuted to judgment.
e. LETTERS OF CREDIT. All sums advanced by Bank for the benefit
of Borrower under any other instrument or otherwise, including, without
limitation, any amounts paid by Bank under any letters of credit issued
by Bank for the benefit of Borrower.
f. MISCELLANEOUS EXPENSES. All costs and expenses incurred by
Bank in connection with the Loan, whether prior to or at closing or
during the term thereof, including, without limitation, loan
origination fees, commitment fees, extension fees, title insurance
search fees, premiums and endorsement fees, hazard and other insurance
required by the Loan Documents, pre-closing and post-closing
appraisals, appraisal reports or opinions of value, surveys, brokerage
commissions and claims of brokerage in connection with the Loan, ad
valorem and personal property taxes, documentary stamp taxes and
intangible taxes, attorneys' fees, consultant fees, architect's and
engineer's fees, construction consultant's fees, environmental surveys
or assessments, and recording charges.
g. INDEMNITIES. All costs, expenses, and amounts arising under
or pursuant to any indemnity contained within the Loan Documents or in
any separate agreement executed by Borrower in favor of Bank including,
without limitation, the Hazardous Substance Certificate and
Indemnification Agreement (the "Indemnity").
5. TITLE WARRANTIES. Subject to the Permitted Encumbrances (as
hereinafter defined), Borrower covenants with Bank that: (i) Borrower is
indefeasibly seized of the Land and Improvements in fee simple, has good and
marketable title to the Collateral and has full power, lawful right and
authority to convey the same in fee simple and to grant Bank a perfected first
lien security interest in the Collateral, and (ii) the Collateral is free and
clear of all liens, encumbrances, restrictions, and security interests of any
nature except for those permitted encumbrances which Bank has previously
approved, as set out in Schedule B of the title insurance policy and
endorsements insuring this Mortgage, which are referred to as "Permitted
Encumbrances" in this Mortgage.
5
6. LIENS. Except as otherwise provided in the Loan Agreement,
Borrower will not create or permit to be created, or to remain, and will
promptly discharge at Borrower's expense any and all liens or encumbrances upon,
or security interests in, the Collateral, or any combination thereof, whether
consensual, common law, statutory, voluntary, involuntary, or arising by
operation of law, except Permitted Encumbrances. Notwithstanding the foregoing,
and except for any construction liens, Borrower may contest the amount, validity
and enforceability of any involuntary or nonconsensual lien, encumbrance or
security interest, including those arising by operation of law, in the manner
provided in paragraph 8 below. Except as otherwise provided in the Loan
Agreement, if any construction lien is filed against the Mortgaged Property,
Borrower agrees to discharge or otherwise remove such lien by bond or otherwise,
within thirty (30) days of imposition of same, but may thereafter contest the
amount or validity of such lien as provided in paragraph 8 below.
7. TAXES AND OTHER IMPOSITIONS. Borrower will pay or cause to be
paid, prior to any delinquency in (i) all property taxes, assessments, water,
sewer, utility and other rents, rates and charges, including all excises, taxes,
levies, license fees, permit fees, impact fees, connection fees, and other fees
and charges, whether general or special, ordinary or extraordinary, foreseen or
unforeseen, that may be assessed, levied or imposed upon the Collateral, or
otherwise arising with respect to the occupancy, use, possession or disposition
thereof, whether or not the failure to pay the same might result in the creation
of a lien upon the Collateral, or any combination thereof; (ii) all franchise,
excise and other taxes, fees and charges assessed, levied or imposed with
respect to Borrower's right to do business in the State of Florida and the
political subdivisions thereof; (iii) all taxes and fees (except for Bank's
state and federal income taxes) that may be levied by the United States of
America or any state or political subdivision thereof, upon Bank or Borrower in
connection with or upon the Loan Documents, or the Debt or its payment, or
collection, or any combination thereof (including all documentary stamp taxes
and intangible taxes plus any penalties and interest charged for the late
payment of any such taxes); and (iv) except as otherwise provided in the Loan
Agreement, all lawful claims and demands of contractors, subcontractors,
mechanics, laborers, materialmen and other lienors which, if unpaid, might
result in the creation of a lien upon the Collateral. The sums payable under
this paragraph are called "Impositions". Nothing contained in this paragraph
will require the payment of any Imposition so long as the amount, validity or
enforceability thereof is contested by appropriate proceedings as provided in
paragraph 8 below. With respect to state and local real and tangible personal
property taxes, however, Borrower will pay same and will furnish Bank with
copies of the receipts for each such payment without demand prior to April 30th
of each year of the Loan and any contest of the same must be by a suit or other
proceeding for a refund. With respect to all other Impositions, Borrower will
furnish Bank with proof of such payment upon demand. If any payment required to
be made by Borrower by this paragraph is prohibited by law, with the result that
Bank becomes liable for its payment, then the Debt will immediately become due
and payable, at Bank's option.
8. CONTESTS. Borrower may contest, by any and all appropriate
administrative, trial or appellate proceedings, or any combination thereof, and
in Bank's name, if required by law, the amount, validity, enforceability or
application of any Imposition that Borrower is required to pay or perform to any
person or entity other than Bank by any provision of this Mortgage or the other
Loan Documents if and only for so long as: (i) Borrower notifies Bank in writing
of its intent to contest the Imposition; (ii) such contest suspends the
collection or enforcement of the item(s) contested; (iii) no part of the
Collateral will be subject to loss, sale or forfeiture before final
determination of any such contest; (iv) neither Borrower nor Bank will be
subject to any criminal liability; (v) Borrower furnishes such security as may
be required by law in connection with each such contest; (vi) the value,
usefulness and marketability of the Collateral will not be adversely impaired by
any such contest; (vii) Borrower otherwise continues to pay and perform, as the
case may be, the Debt and Borrower's obligations under this Mortgage; (viii)
Borrower otherwise is not in Default under any provision of the Loan Documents;
(ix) each such contest is continuously prosecuted diligently to final
determination; (x) Borrower pays or causes to be paid, and defends, indemnities
and holds Bank harmless of and from any and all losses, judgments, decrees and
costs (including all reasonable attorneys, fees) incurred in connection with
each such contest; (xi) Borrower, promptly following final determination of each
such contest, fully pays and discharges all amounts that may be levied,
assessed, charged, imposed or otherwise determined to be payable, together with
all penalties, fines, interests, costs
6
and expenses, and otherwise complies with such final determination, at
Borrower's sole cost and expense; (xii) Borrower furnishes Bank with such
security as Bank reasonably may require to assure Borrower's compliance with all
of the foregoing requirements, and (xiii) such liens are not filed against the
Mortgaged Property pursuant to Chapter 713, Florida Statutes, in which event
such liens must be discharged or transferred to bond pursuant to paragraph 6
above before Borrower contests such liens except as otherwise provided in the
Loan Agreement. So long as Borrower complies with the foregoing and Bank is
promptly reimbursed for all costs and expenses incurred, Bank will cooperate
with Borrower in connection with any such contest.
9. INSURANCE. Until the Debt shall have been discharged by Borrower,
Borrower shall maintain, at Borrower's cost and expense, the following insurance
coverages in full force and effect at all times:
a. HAZARD INSURANCE. Borrower shall keep the Tangible Property
and Improvements which now or hereafter may constitute part of the
Mortgaged Property insured at all times against loss or damage by fire
and other hazards included within the term "all risk" or "extended
coverage" and against such other hazards as Bank may require in the
full insurable value thereof (or such lesser amount as Bank may
authorize in writing) , with an insurer satisfactory to Bank. Such
policy shall include a Replacement Cost and Agreed Amount/Stipulated
Value Endorsement and a Sinkhole Endorsement, if deemed necessary by
Bank.
b. LIABILITY INSURANCE. Borrower will obtain and keep in full
force a "Broad Form Comprehensive General Liability" insurance coverage
for both Borrower and any contractor performing services to the
Mortgaged Property in the minimum coverage amount of TWO MILLION AND
NO/100 DOLLARS ($2,000,000.00) per occurrence for bodily injury and One
Hundred Thousand Dollars ($100,000.00) per occurrence for property
damage.
x. XXXXX INSURANCE. If at any time the Land or any portion
thereof is located in a "Flood Hazard Area" pursuant to the Flood
Disaster Protection Act of 1973 or any successor or supplemental act
thereto, flood insurance in the maximum amount available or such other
amount as Bank may reasonably request;
d. BUILDER'S RISK INSURANCE. An "All risk", non-reporting,
completed value builder's risk insurance policy in an amount not less
than loan amount on a per unit basis which policy shall include Agreed
Amount, Replacement Cost, Permit to occupy and Vandalism/Malicious
Mischief Endorsements.
e. OTHER INSURANCE. Machinery insurance, worker's c ompensation
insurance, wind damage insurance, and other insurance coverages as Bank
may reasonably require.
The policy or policies of insurance shall (i) be from companies and in
coverage amounts acceptable to Bank, (ii) contain a standard mortgagee clause in
favor of Bank naming Bank as a mortgagee and including a lender's loss payee
clause in such policy, as applicable (iii) not be terminable or modified without
thirty (30) days, prior written notice to Bank, and (iv) be evidenced by
original policies or certified copies of policies deposited with Bank, as Bank
may elect, to be held by Bank until the Debt shall have been fully paid and
discharged. Borrower shall furnish Bank satisfactory evidence of payment of all
premiums required and similar evidence of renewal or replacement coverage not
later than thirty (30) days prior to the date any coverage will expire.
Each insurance policy or endorsement required herein shall be written
by an insurer having a rating not less than "A-XI" Best's Rating according to
the most current edition of Best's Key Rating Guide as determined at the time of
the initial policy and at all times during the term hereof. All policies shall
indicate that notices related to such insurance shall be sent to Bank at:
Chase Federal Bank, a Federal Savings Bank,
7
a Division of NationsBank, N.A. (South)
Suite 101 000 Xxxx Xxxxxxx Xxxxx Xxxx
Xx. Xxxxxxxxxx, XX 00000
Attn: Loan Administration Section,
Real Estate Banking Group
If any loss occurs with respect to the Mortgaged Property, Bank is
hereby appointed attorney-in-fact for Borrower to make proof of loss if Borrower
fails to make the same punctually, and to give a receipt for any proceeds
collected under such policies. Borrower will promptly give written notice to
Bank of any loss or damage greater than ONE THOUSAND AND NO/100 DOLLARS
($1,000.00) per Unit or TWENTY FIVE THOUSAND AND NO/100 DOLLARS ($25,000.00)
cumulatively to the Mortgaged Property, and will not adjust or settle any such
loss without Bank's prior written consent, which consent shall not be
unreasonably withheld or delayed. Upon any Default by Borrower under this
Mortgage, all right, title and interest of Borrower in and to all such insurance
policies then in force, including any and all unearned premiums and existing
claims, will inure to Bank, which, at its option, and as attorney-in-fact for
Borrower, may then make, settle and give binding acquittances for claims under
all such policies, and may assign and transfer such policies or cancel or
surrender them, applying any unearned premium in such manner as Bank may elect.
The foregoing appointment of Bank as attorney-in-fact for Borrower is coupled
with an interest, and is irrevocable. Notwithstanding the occurrence of any
casualty or the availability of any insurance proceeds, Borrower will pay the
Debt in the manner required by the Loan Documents.
10. CONDEMNATION. If all or any part of the Collateral, or any
interest therein or right accruing thereto, is taken as a result of, or in lieu
or in anticipation of, the exercise of the right of condemnation or eminent
domain, or by reason of the temporary requisition of the use or occupancy of the
Mortgaged Property, in any event by any government or quasi-governmental
authority, civil or military, or any other party entitled to exercise such
powers by law, general or special, or is devalued or otherwise adversely
affected by any of the foregoing actions, all proceeds payable with respect to
any such action are assigned to Bank and shall be paid to Bank. Bank shall be
under no obligation to question the amount of any such award or compensation and
may accept the same in the amount in which the same shall be paid. The proceeds
of any award or compensation so received shall, at the option of the Bank,
either be applied to the payment of the Debt or be paid over to the Borrower for
the restoration of the Improvement. Borrower, immediately upon obtaining
knowledge of the institution or threatened institution, of any proceedings for
the Mortgaged Property, or any part thereof, by condemnation or eminent domain,
will notify the Bank of the pending of such proceedings. Bank shall have the
right to intervene and participate in any proceedings for and in connection with
any taking referred to in this section. Borrower shall not enter into any
agreement for the taking of the Mortgaged Property or any part thereof with any
person or persons authorized to acquire the same by condemnation or eminent
domain, unless the Bank shall have consented thereto in writing. Any of the
foregoing actions are sometimes called a "condemnation" or "taking" in this
Mortgage and the other Loan Documents. Such proceeds include, without
limitation, severance damages, damages arising from the change of grade of any
street or the access thereto, the taking of air rights and damages caused by
noise, pollutants and other emissions. Notwithstanding any such taking or other
injury or decrease in value, or the availability of any proceeds for any of the
foregoing, Borrower shall continue to pay the Debt in the manner required by the
Loan Documents. Bank's rights under this paragraph will survive the foreclosure
or other enforcement of this Mortgage, and Bank will have the right to receive
and retain all proceeds to the extent of any deficiency which exists upon such
foreclosure or other enforcement, together with legal interest thereon, and to
the extent of the reasonable counsel fees, costs and disbursements incurred by
Bank in connection with the collection of such proceeds. Such right shall exist
whether or not a deficiency judgment shall have been sought or recovered or
denied upon the Note. The remaining balance of such proceeds, if any, will inure
to the benefit of the party entitled thereto by applicable law. Notwithstanding
the foregoing, if Bank uses the net proceeds of the condemnation to reduce the
principal balance owed under the Note, Bank will thenceforth allow those funds
to be disbursed to the Borrower in accordance with the Loan Agreement.
8
11. APPLICATION OF INSURANCE PROCEEDS AND AWARDS. The Borrower will
promptly give the Bank written notice of any damage to or destruction of the
Mortgaged Property or any part thereof, generally describing the nature and
extent of such damage or destruction and the Borrower's best estimate of the
cost of restoring the Mortgaged Property. The Bank shall be entitled to all
insurance proceeds payable on account of such damage or destruction and the
Borrower hereby irrevocably assigns, transfers and sets over to the Bank all
rights of the Borrower to any such proceeds or payments and irrevocably
authorizes and empowers the Bank, at its option and in its sole and absolute
discretion, in the name of the Borrower or otherwise, to file and prosecute what
would otherwise be the Borrower's claim for any such proceeds or payment and to
collect, receipt for and retain the same for disposition in accordance with this
Section. The Bank may, at its sole option, apply all amounts recovered under any
insurance policy required to be maintained by the Borrower hereunder in any one
or more of the following ways: (a) to the payment of the reasonable costs and
expenses incurred by the Bank in obtaining such insurance proceeds, including
the fees and expenses of attorneys and insurance and other experts and
consultants, the costs of litigation, arbitration, mediation, investigations and
other judicial, administrative or other proceedings and all other out-of-pocket
expenses; (b) to the payment of any of the Debt other than indebtedness with
respect to the Note at the time outstanding; (c) to the payment of the principal
of the Note and any interest accrued and unpaid thereon, without regard to
whether any portion or all of such amounts shall be matured or unmatured,
together with interest at the default interest rate on any overdue principal and
(to the extent permitted by applicable law) interest; and, in case such amount
shall be insufficient to pay in full all such amounts, then such amounts shall
be applied, FIRST, to the payment of all amounts of interest accrued on the Note
and unpaid, without preference or priority of any payment of interest over any
other payment of interest or of any other Note, and, SECOND, to the payment of
all amounts of principal at the time outstanding, without preference or priority
of any installment or amount of principal over any other installment or amount
of principal or of any Note over any other Note, but otherwise in such manner
and order as the Bank shall in its sole discretion determine; (d) to fulfill any
of the other covenants contained herein as the Bank may determine; (e) release
to the Borrower for application to the cost of restoring the Mortgaged Property;
or (f) release to the Borrower. In the event of a foreclosure of this Mortgage,
the purchaser of the Mortgaged Property shall succeed to all the rights of the
Borrower including any right to unearned premiums, in and to all policies of
insurance assigned and delivered to the Bank. Notwithstanding the foregoing, if
Bank uses the net proceeds of the insurance proceeds or awards to reduce the
principal balance owed under the Note, Bank will thenceforth allow those funds
to be disbursed to the Borrower in accordance with the Loan Agreement.
Notwithstanding anything in this paragraph to the contrary, if the Bank has
elected to apply proceeds to the Debt, Bank will re-disburse said proceeds in
accordance with the Loan Agreement.
12. MAINTENANCE, REPAIRS, AND RECONSTRUCTION.
a. MAINTENANCE AND REPAIRS. Borrower, at its sole cost and
subject to Bank's satisfaction, shall make all repairs, renewals,
replacements, servicing and reconstruction that are necessary to
maintain the Mortgaged Property in good order, condition and repair.
Immediately following the occurrence of any casualty or other loss,
Borrower promptly will undertake all restoration required or desirable
and will pursue it diligently to completion. The foregoing shall be
accomplished by the Bank funding the insurance proceeds it receives
from the insurer to the Borrower under the terms and conditions of the
Loan Agreement for the construction of individual Units. Borrower shall
(i) not strip, waste, remove or demolish any portion of the Mortgaged
Property, nor suffer or permit any such action; (ii) promptly comply
with all laws, governmental regulations and public or private
restrictions or easements, or both, of any kind affecting the Mortgaged
Property or requiring any alterations or improvements to be made
thereon, and (iii) not commit, suffer or permit any act upon the
Mortgaged Property in violation of any law, subject to Borrower's
right' to contest the same in good faith to conclusion, as provided in
paragraph 8 of this Mortgage. If any public agency or authority
requires or commences any proceedings for the demolition or removal, or
both, of any improvements or portions thereof comprising the Mortgaged
Property due to non-compliance with health, safety, fire or building
codes, then, unless Borrower undertakes to contest such action in the
manner provided in paragraph 8 above and pursues such contest to a
successful conclusion, such action will constitute a Default under this
Mortgage. Borrower will not,
9
without Bank's prior written consent, (i) make any material
alterations, additions or improvements of or to the Mortgaged Property
unless required by the Loan Agreement; (ii) make any material change in
the general nature of the use or occupancy of the Mortgaged Property;
(iii) institute or join or acquiesce in any action to change the
existing zoning or land use classification of the Mortgaged Property,
or (iv) grant easements or licenses affecting the use or operation of
the Mortgaged Property. Bank and any persons authorized by Bank may
enter the Mortgaged Property at all reasonable times without prior
notice for inspections or for any other lawful purpose. If Borrower
fails to comply with the requirements of this paragraph, then Bank,
without waiving the option to foreclose, may take some or all measures
Bank reasonably deems necessary or desirable for the maintenance,
repair, preservation or protection of the Mortgaged Property, and any
expenses reasonably incurred by Bank in so doing shall become part of
the Debt secured hereby, and shall, at the option of Bank, become
immediately due and payable, and shall bear interest at the Default
Rate specified in the Note. Bank shall have no obligation to care for
or maintain the Mortgaged Property, or, having taken some measures
therefor, to continue same or take other measures.
b. RECONSTRUCTION. The Borrower after receipt of net insurance
proceeds from Bank funded in accordance with the Loan Agreement shall
promptly repair, restore, replace or rebuild any part of the Mortgaged
Property, now or hereafter encumbered by this Mortgage which may be
affected by any condemnation proceeding or which may otherwise become
damaged, destroyed, lost or unsuitable for use. In the event the
Mortgaged Property or any part thereof if damaged or destroyed by fire
or other casualty, the Borrower shall immediately notify the Bank, in
writing, of such damage or destruction. The Borrower shall not cause or
permit anything to be done which would or could increase the risk of
fire or other hazard to the Mortgaged Property, or any part thereof, or
which would or could result in an increase in any insurance premiums
payable with respect to the Mortgaged Property, or which would or could
result in the cancellation of any insurance policy carried with respect
to the Mortgaged Property. No part of the Mortgaged Property,
including, but not limited to, any building, structure, water system,
sewer system, parking lot, driveway, landscape scheme, timber or other
ground improvement, equipment or other property, now or hereafter
mortgaged, shall be removed, demolished or materially altered without
the prior written consent of the Bank. No top soil, sand, sod, loam,
clay or gravel shall be mined, stripped, or removed from the Mortgaged
Property without the written consent of the Bank. However, this shall
not prevent or restrict removal of any such materials taken for
excavation necessary to construct a basement, cellar or foundation
footings for the erection of a building or buildings for which a
building permit or permits has or have first been issued by the
governmental authority having jurisdiction thereof; or for the
construction of roadways or the Improvements constructed in accordance
with plans approved by the governmental authorities having jurisdiction
thereof in accordance with the Loan Agreement; provided, nevertheless,
that in the event the required removals become so extensive, as
determined by the Bank, as to create profit by sale of the removed
portion of the Mortgaged Property, said sums shall inure to the benefit
of the Bank to be applied as the Bank so directs, to the reduction of
the Debt.
13. ADVANCES. If Borrower Defaults in the observance or performance of
any of the provisions of the Loan Documents, including but not limited to
obtaining and maintaining insurance pursuant to paragraph 9, paying Impositions
pursuant to paragraph 7, and maintaining the Mortgaged Property pursuant to
paragraph 12, then Bank, without waiving or otherwise impairing any other of its
rights or remedies, at its sole option and without obligation to do so, and
without demand upon Borrower, may make any such payment or take such action as
Bank deems necessary or appropriate to correct such Default, or to protect the
security of the Collateral encumbered by the Loan Documents. All payments so
made, together with all costs and expenses so incurred, will be added to the
principal amount due under the Note and thereafter will bear interest at the
rate then payable as provided for in the Note, and will be secured by the lien
and security interest granted by the Security Documents. For the foregoing
purposes, Bank is authorized to (a) enter upon the Mortgaged Property; (b)
appear in and defend any action or proceeding purporting to affect the security
of this Mortgage or the rights or powers of Bank hereunder; (c) pay, purchase,
contest or compromise any encumbrance, charge or lien that in the reasonable
judgment of Bank appears
10
to adversely affect the Collateral; and (d) take whatever action Bank, in its
discretion, deems necessary or appropriate in exercising any such powers.
Notwithstanding the foregoing, Borrower immediately, upon Bank's demand, will
pay all sums so expended by Bank with interest as stated above.
14. BOOKS AND RECORDS. Borrower, at all times, will keep proper books
of record and account in which full, true and correct entries will be made of
its transactions with respect to the Collateral in accordance with generally
accepted accounting principles, consistently applied, and which will properly
and correctly reflect all items of income and expense in connection with the
operation of the Collateral, regardless of whether such income or expense is
realized by Borrower or any other person or entity whatsoever. Bank will have
the right from time to time during normal business hours to examine all such
books, records and accounts at Borrower's office or at the office of such other
person as maintains them, and to make such copies or extracts as Bank may
desire, at Borrower's expense.
15. TAXATION OF MORTGAGE. In the event of the passage after the date
of this Mortgage of any federal, state or local law deducting from the value of
real property for the purpose of ad valorem taxation any lien thereon or
changing in any way the laws for the taxation of mortgages or debts secured by
mortgages for federal, state or local purposes, or the manner of the collection
of any such taxes, and imposing a tax, either directly or indirectly, on any or
all of the Loan Documents, Bank shall have the right to declare the Debt due on
a date to be specified by not less than sixty (60) days' written notice given to
Borrower by Bank; provided, however, that such election shall be ineffective if
Borrower is permitted by law to pay the whole of such tax in addition to all
other payments required hereunder, and if Borrower, prior to such specified
date, does pay such tax and agrees to pay any such tax (excluding, however, all
taxes on the income of Bank) when thereafter levied or assessed, and such
agreement shall constitute a modification of this Mortgage. Notwithstanding any
provision in this paragraph to the contrary, Borrower may contest the matters
described herein per the procedures set forth in paragraph 8 above.
16. ASSIGNMENT OF RENTS, LEASES, PROFITS AND CONTRACT RIGHTS. Pursuant
to paragraph 1 of this Mortgage, Borrower has irrevocably assigned and set over
unto Bank all right, title, and interest of Borrower in and to the Rents and
Contract Rights (including all leases and sales contracts now or hereafter
existing relating to the Mortgaged Property) as security for the Debt, together
with the right to collect and enforce the same; provided, however, so long as
there shall be no Default under the Loan Documents, Borrower has been granted a
license to collect and receive all Rents assigned hereunder in accordance with
paragraph 1. Neither these assignments nor Bank's enforcement of the provisions
of these assignments (including the receipt of the Rents) will operate to
subordinate the lien of this Mortgage to any of the rights of any lessee or
purchaser under any lease or sales contract of the Mortgaged Property, or to
subject Bank to any liability to any such lessee or purchaser for the
performance of any obligations of Borrower under any such lease or sales
contract unless and until Bank agrees to such subordination or assumes such
liability by an appropriate written instrument. All right, title and interest of
each such lessee or purchaser in and to the Mortgaged Property, whether arising
by virtue of any such lease, contract or otherwise, at all times will be and
remain subject, subordinate and inferior to the lien of this Mortgage and all
rights, remedies, powers and privileges of Bank arising under or by virtue of
any of the Loan Documents. The assignments of Rents and Contract Rights
(including leases) contained in this Mortgage are intended to provide Bank with
all the rights and remedies of mortgagees pursuant to Section 697.07, Florida
Statutes, as may be amended from time to time. However, in no event shall this
reference diminish, alter, impair, or affect any other rights and remedies of
Bank. Notwithstanding the foregoing, if Borrower shall have executed an
Assignment of Rents constituting one of the Loan Documents, such Assignment of
Rents is hereby incorporated herein by reference and shall control if in
conflict with the provisions of this Mortgage.
17. LEASES AFFECTING MORTGAGED PROPERTY. The assignments contained in
paragraph 1 shall not be deemed to impose upon Bank any of the obligations or
duties of Borrower provided in any lease affecting the Mortgaged Property
(including, without limitation, any liability under the covenant of quiet
enjoyment contained in any lease in the event that any tenant shall have been
joined as a party defendant in any action to foreclose this Mortgage and shall
have been barred and foreclosed thereby of all right, title and interest and
equity
11
of redemption in the Mortgaged Property or any part thereof), and
Borrower will comply with and observe its obligations as landlord under all
leases affecting the Mortgaged Property or any part thereof. Borrower has a
license to collect the Rents, but shall not accept payment of rent more than one
month in advance without the prior written consent of the Bank, and only so long
as there is no Default hereunder or under the other Loan Documents. Borrower
shall receive the Rents in trust on Bank's behalf, and Borrower covenants to
apply same to the payment of taxes and assessments upon the Mortgaged Property,
to the cost of insurance and maintenance and repairs, and to the payment of the
Debt, before using any part of the Rents for any other purpose.
Prior to a Default hereunder and demand by Bank for delivery of
security deposits held by Borrower or any agent of Borrower to Bank or its
designee, Borrower shall maintain all security deposits pursuant to the leases
in a separate, identifiable account deposited with Bank, or any other
institution acceptable to Bank, and in accordance with all applicable laws and
regulations. Upon delivery of such security deposits to Bank, or upon Bank's
enforcement of its security interest in such deposits, Bank shall hold such
security deposits pursuant to the terms of the leases in respect of which such
deposits were obtained by Borrower and in accordance with applicable law;
provided, however, in no event shall Bank be liable to any lessee of any part of
the Mortgaged Property for the return of any security deposit in any amount in
excess of the amount delivered to Bank by Borrower. Any security deposits held
by Bank shall not bear interest unless required by applicable law.
Borrower will: (a) not collect any of the Rents arising or accruing
under any lease in advance of the time when the same shall become due, other
than as required to be paid in advance by the terms of any lease, but in no
event more than one (1) month in advance; (b) not pledge, transfer, mortgage or
otherwise encumber or assign any of Borrower's interest in the leases or any
Rents arising or accruing therefrom; (c) not waive, excuse, condone, discount,
set-off, compromise, or in any manner release or discharge any tenant thereunder
of and from any obligations, covenants, conditions and agreements by said tenant
to be kept, observed and performed, including the obligation to pay the rents
thereunder, in the manner at the place and time specified therein; (d) not
cancel, terminate or consent to any surrender of any lease, nor modify, alter or
change any of the terms thereof without the prior written consent of Bank; (e)
not consent to any assignment of or subletting under any lease, whether or not
in accordance with the terms thereof, without the prior written consent of Bank;
and (f) not enter into, execute or deliver any leases without the prior written
consent of Bank.
In the event any tenant of the Mortgaged Property should be the subject
of any proceeding under the Federal Bankruptcy Code, as amended from time to
time, or any other federal, state or local statue which provided for the
possible termination or rejection of any of the leases assigned hereby, Borrower
covenants and agrees that if any of the leases is so terminated or rejected, no
settlement for damages shall be made without the prior written consent of Bank,
and any check in payment of damages for termination or rejection of any such
lease will be made payable both to Borrower and Bank. Borrower hereby assigns
any such payment to Bank and further covenants and agrees that upon the request
of Bank, it will duly endorse to the order of Bank any such check, the proceeds
of which will be applied to that portion of the Debt as Bank may elect.
From time to time, Borrower agrees to obtain tenant estoppel
certificates from each tenant of the Mortgaged Property containing such
information as may be reasonably requested by Bank.
18. DEFAULT. The occurrence of any of the following (time being of the
essence as to this Mortgage and all of its provisions) constitutes a "Default"
by Borrower under this Mortgage, and, at the option of Bank, under the other
Loan Documents:
a. SCHEDULED PAYMENT. Borrower's failure to make any payment
required under the Note when due or within any applicable grace period.
b. MONETARY DEFAULT. Borrower's failure to make any other
payment required by this Loan Agreement or the other Loan Documents
when due.
12
c. OTHER. Borrower's failure to perform any other obligation
imposed upon Borrower by this Loan Agreement or any other Loan Document
within thirty (30) days after the date when performance is due. This
provision shall not be construed to provide Borrower with any grace
period in complying with any obligations imposed on Borrower by the
terms of the Loan Documents. Notwithstanding the foregoing provision,
Bank shall give Borrower notice, as defined in the Mortgage, of any
non-monetary default after which Borrower shall have a thirty (30) day
cure period, unless such non-monetary default is not capable of being
cured within said thirty (30) day period, in which case Borrower shall
have sixty (60) days to cure such default following the date
performance is due provided Borrower has commenced and is diligently
pursuing the cure for such default (which determination shall be made
in Bank's sole and absolute discretion), and provided such additional
time to cure such default does not negatively affect the value of the
collateral or the preservation of the collateral's value, which
determination shall be made in Bank's sole and absolute discretion..
d. REPRESENTATION. Any representation or warranty of Borrower
contained in this Loan Agreement or in any certificate delivered
pursuant hereto, or in any other instrument or statement furnished in
connection herewith, proves to be incorrect or misleading in any
adverse respect as of the time when the same shall have been made,
including, without limitation, any and all financial statements,
operating statements, and schedules attached thereto, furnished by
Borrower or any guarantor of the Loan to Bank or pursuant to any
provision of this Loan Agreement.
e. BANKRUPTCY. Borrower or any general partner of Borrower or
any guarantor of the Loan (i) files a voluntary petition in bankruptcy
or a petition or answer seeking or acquiescing in any reorganization or
for an arrangement, composition, readjustment, liquidation,
dissolution, or similar relief for itself pursuant to the United State
Bankruptcy Code or any similar law or regulation, federal or state,
relating to any relief for debtors, now or hereafter in effect; or (ii)
makes an assignment for the benefit of creditors or admits in writing
its inability to pay or fails to pay its debts as they become due; or
(iii) suspends payment of its obligations or takes any action in
furtherance of the foregoing; or (iv) consents to or acquiesces in the
appointment of a receiver, trustee, custodian, conservator, liquidator
or other similar official of Borrower, a general partner of Borrower,
or any guarantor, for all or any part of the Collateral or other assets
of such party, or either; or (v) has filed against it an involuntary
petition, arrangement, composition, readjustment, liquidation,
dissolution, or an answer proposing an adjudication of it as a bankrupt
or insolvent, or is subject to reorganization pursuant to the
United-States Bankruptcy Code, an action seeking to appoint a trustee,
receiver, custodian, or conservator or liquidator, or any similar law,
federal or state, now or hereinafter in effect, and such action is
approved by any court of competent jurisdiction and the order approving
the same shall not be vacated or stayed within sixty (60) days from
entry; or (vi) consents to the filing of any such petition or answer,
or shall fail to deny the material allegations of the same in a timely
manner.
f. JUDGMENTS. (1) A final judgment other than a final judgment
in connection with any condemnation is entered against Borrower,
Guarantors, or any general partner of Borrower, that (i) adversely
affects the value, use or operation of the Land or the improvements in
Bank's sole judgment, or (ii) adversely affects, or may adversely
affect, the validity, enforceability or priority of the lien or
security interest created by the Mortgage or any other Loan Document in
Bank's sole judgment, or both; or (2) execution or other final process
issues thereon with respect to the Land or the Improvements; and (3)
Borrower, Guarantor, or any general partner of Borrower, does not
discharge the same or provide for its discharge in accordance with its
terms, or procure a stay of execution thereon, in any event within
thirty (30) days from entry, or Borrower shall not, within such period
or such longer period during which execution on such judgment shall
have been entered, and cause its execution to be stayed during such
appeal, or if on appeal such order, decree or process shall be affirmed
and Borrower shall not discharge such judgment or provide for its
discharge in accordance with its terms within sixty (60) days after the
13
entry of such order or decree or affirmance, or if any stay of
execution on appeal is released or otherwise discharged.
g. LIENS. Any federal, state or local tax lien or any claim of
lien for labor or materials or any other lien or encumbrance of any
nature whatsoever is recorded against Borrower or the Land or
Improvements and is not removed by payment or transferred to substitute
security in the manner provided by law, within thirty (30) days after
it is recorded in accordance with applicable law.
h. OTHER NOTES OR MORTGAGES. Borrower's default in the
performance or payment of Borrower's obligations under any other note
which remains uncured after any applicable grace period, or under that
certain Real Estate Mortgage, Assignment and Security Agreement of even
date herewith in favor of Bank, securing a note in the original
principal amount of THREE MILLION AND NO/100 DOLLARS ($3,000,000.00)
and encumbering that portion of the Land commonly referred to as Parcel
"F" and that certain Real Estate Mortgage, Assignment and Security
Agreement of even date herewith in favor of Bank, securing a note in
the original principal amount of THREE MILLION FOUR HUNDRED THOUSAND
AND NO/100 DOLLARS ($3,400,000.00), and encumbering that portion of the
Land commonly referred to as Parcel "D", or under any other mortgage
encumbering all or any part of the Land or the Improvements, if the
other mortgage is permitted by the Bank, whether such other note or
mortgage is held by Bank or by any other party, and unless otherwise
agreed to by separate written agreement between Bank and such other
mortgage holder.
i. BORROWER DEFAULT UNDER LOAN DOCUMENTS. Borrower's default in
the payment or performance following expiration of any applicable grace
period of any of Borrower obligations under any of the Loan Documents,
including this Mortgage and any riders thereto.
j. GUARANTOR DEFAULT.
i) The default after expiration of any applicable grace
period in the payment or performance of any obligation of a
Guarantor of the Note arising under its guaranty or pursuant to
any other Loan Documents; or
ii) The death of any Guarantor and the failure of Borrower
to provide Bank with an alternate guaranty or alternate collateral
satisfactory to Bank in its sole and absolute discretion within
sixty (60) days of the date of Guarantor's death.
k. BORROWERS/GENERAL PARTNER'S CONTINUED EXISTENCE. Borrower or
any corporate General Partner of Borrower shall cease to exist or to be
qualified to do or transact business in the State in which the Land and
Improvements are located, or shall be dissolved or shall be a party to
a merger or consolidation, or shall sell all or substantially all of
its assets, or shall change its corporate name or trade name without
prior written notice to Bank.
l. STOCK IN BORROWER/CHANGE IN PARTNERS. If Borrower is a
limited partnership and without the prior written consent of Bank, any
shares of stock of any corporate general partner of Borrower are
issued, sold, transferred, conveyed, assigned, mortgaged, pledged, or
otherwise disposed of so as to result in change of control of Borrower,
whether voluntarily or by operation of law, and whether with or without
consideration, or any agreement for any of the foregoing is entered
into; or, if any general partnership interest or other equity interest
in the Borrower is sold, transferred, assigned, conveyed, mortgaged,
pledged, or otherwise disposed of, whether voluntarily or by operation
of law, and whether with or without consideration, or any agreement for
any of the foregoing is entered into, or any general partner of
Borrower withdraws from the partnership.
14
m. TRANSFER OF PROPERTY OR OWNERSHIP. Any sale, conveyance,
transfer, assignment, or other disposition or encumbrance of all or any
part of the Land, Improvements, or the Approved Project, or any
ownership interest in Borrower or any guarantor without the prior
consent of Bank or except as otherwise permitted hereby, or as outlined
in the prospectus for public offering for Transeastern Properties,
Inc., a Florida corporation delivered to Bank by Borrower.
n. FALSE STATEMENT. Any statement or representation of Borrower
or any guarantor contained in the loan application or any financial
statements or other materials furnished to Bank or any other Bank prior
or subsequent to the making of the Loan secured hereby are discovered
to have been false or incorrect or incomplete.
o. DEFAULT UNDER INDEMNITY. Borrower or Guarantor shall default
after any applicable grace period under any obligation imposed by any
indemnity contained within any of the Loan Documents including the
Hazardous Waste Certification and Indemnification.
p. OTHER DEFAULTS. Borrower or Guarantor shall Default under any
other Default provision set forth in the Loan Agreement, which is not
cured within any applicable grace period.
19. REMEDIES. Upon the occurrence and continuance, if applicable, of
any Default, Bank may exercise any one or more of the following rights and
remedies, in addition to all other rights and remedies otherwise available at
law or in equity:
a. OTHER DOCUMENTS. To pursue any right or remedy provided by
the Loan Documents.
b. ACCELERATION. To declare the entire unpaid amount of the Debt
together with all accrued and unpaid interest thereon immediately due
and payable with interest to be due thereon at the Default Rate set
forth in the Note.
c. FORECLOSURE. To foreclose the lien of this Mortgage and
obtain possession of the Collateral, by any lawful procedure.
d. CODE RIGHTS. To exercise any right or remedy available to
Bank as a secured party under the Uniform Commercial Code as adopted by
the State of Florida, as it from time to time is in force and effect,
with respect to any portion of the Collateral then constituting
property subject to the provisions of such Code; or Bank, at its
option, may elect to treat the Collateral as real property, or an
interest therein, for remedial purposes.
e. RECEIVER. To apply, on EX PARTE motion, to any court of
competent jurisdiction for the appointment of a receiver to take charge
of, manage, preserve, protect, complete construction of, rent, and
operate the Mortgaged Property and any of Borrower's business or
businesses situated thereon, or any combination thereof; to collect the
Rents; to make all necessary and needed repairs; to pay all taxes,
assessments, insurance premiums and all other costs incurred in
connection with the Mortgaged Property; and, after payment of the
expenses of the receivership, including reasonable attorneys, fees and
other costs and expenses related to the enforcement of the Security
Documents, and after compensation to the receiver for any of the
services described herein or pursuant hereto, to apply all net proceeds
derived therefrom in reduction of the Debt or in such other manner as
the court shall direct. The appointment of such receiver shall be a
matter of strict right to Bank, regardless of the adequacy of the
security or of the solvency of any party obligated for payment of the
Debt. All expenses, fees and compensation incurred pursuant to any such
receivership shall be secured by the lien of this Mortgage until paid.
The receiver, personally or through agents, may exclude Borrower wholly
from the Mortgaged Property and have, hold, use, operate, manage and
control the Mortgaged Property and may, in the name of Borrower,
exercise all of
15
Borrower's rights and powers to maintain, construct, operate, restore,
insure and keep insured the Mortgaged Property in such manner as such
receiver deems appropriate.
f. SET-OFFS. Intentionally deleted.
g. RENTS. After Bank shall have given written notice to
Borrower, to collect all rents, issues, profits, revenues, income,
proceeds, or other benefits from the Collateral, or to pursue any
remedy available under Chapter 697.07, Florida Statutes, as amended,
supplemented, or superseded from time to time.
h. OTHER SECURITY. To proceed to realize upon any and all other
security for the Debt in such order as Bank may elect; no such action,
suit, proceeding, judgment, levy, execution or other process will
constitute an election of remedies by Bank or will in any manner alter,
diminish or impair the lien and security interest created by this
Mortgage or any other Security Documents unless and until the Debt is
paid in full.
i. ADVANCES. To advance such monies and take such other action
as is authorized by paragraphs 13 and 25 herein.
20. WAIVER OF CERTAIN RIGHTS. Borrower will not claim, take or insist
upon any benefit or advantage of any present or future stay, extension,
redemption or moratorium law that may affect Borrower's obligations hereunder,
or any law providing for the valuation or appraisal of the Mortgaged Property or
any portion thereof prior to any sale or sales that may be made under or by
virtue of this Mortgage. Borrower, for itself and all who may claim under
Borrower, waives, to the extent that it lawfully may, all rights to have the
Mortgaged Property and any other security for the Debt marshaled upon any
foreclosure or otherwise. Borrower hereby waives and renounces all homestead and
exemption rights provided for by the laws of the United States of America and of
any state, including Florida, in and to the Mortgaged Property as against the
collection of the Debt, or any part thereof.
21. FURTHER ASSURANCES. Borrower, from time to time, will execute,
acknowledge, subscribe and deliver to or at the direction of Bank such documents
and further assurances as Bank may reasonably require for the purpose of
evidencing, perfecting or confirming the lien and security interest created by
this Mortgage, or the security intended to be afforded by the Loan Documents, or
both. Without limitation of the foregoing, Borrower will defend, indemnify and
hold Bank harmless with respect to any suit or proceeding in which the validity,
enforceability or priority of the lien or security interest, or both, is
endangered or contested, directly or indirectly, and will provide Bank with such
security for the defense of any such suit or proceeding as Bank reasonably may
require. If Borrower fails to undertake the defense of any such claim in a
timely manner, or fails to furnish Bank with reasonable security for such
defense after notice from Bank, or, in Bank's sole but reasonable determination,
fails to prosecute such defense with due diligence, then Bank is authorized to
take, at the expense of Borrower, all necessary and proper action in defense of
any such claim, including the retention of legal counsel, the prosecution or
defense of litigation and the compromise or discharge of claims, including
payment of all costs and reasonable attorneys' fees. All costs, expenses and
losses, if any, so incurred by Bank, including reasonable attorneys' fees,
regardless of whether suit is brought and, if suit is brought, for all
administrative, trial and appellate proceedings, if any, will constitute
advances by Bank as provided in paragraph 13.
22. CUMULATIVE RIGHTS AND NON-WAIVER. No right or remedy conferred
upon or reserved to Bank by this Mortgage or in any of the other Loan Documents
is intended to be exclusive of any other right or remedy; and each and every
right and remedy is cumulative and in addition to any other right or remedy
otherwise available. Every right, power, privilege and remedy granted Bank by
this Mortgage or any of the other Loan Documents, or both, or otherwise
available at law or in equity may be exercised by Bank from time to time as
often as Bank deems expedient until the Debt is paid in full. Bank's failure to
insist at any time upon the strict
16
observance or performance by Borrower of any of the provisions of this Mortgage
or in any of the other Loan Documents, or to exercise any right or remedy
provided for in this Mortgage or in any of the other Loan Documents, will not
impair any such right or remedy or be construed as a waiver or relinquishment
thereof for the future. Receipt by Bank of any payment required to be made
pursuant to any of the Loan Documents with knowledge of the breach of any
provision of any of the Loan Documents will not constitute a waiver of such
breach. In addition to all other remedies provided in this Mortgage, Bank will
be entitled, to the extent permitted by applicable law, to injunctive relief in
the case of a violation or attempted or threatened violation of any of the
provisions of the Loan Documents or to a decree ordering performance of any of
the provisions of any of the foregoing.
23. JUDGMENT. Bank may seek and recover a judgment for all amounts due
and payable in accordance with the Note or under this Mortgage either before,
after or during the pendency of any other proceedings or action to obtain relief
under or with respect to any of the Loan Documents. Bank's right to seek and
recover any such judgment will not be affected by obtaining any other such
relief. Bank will continue to be entitled to enforce payment of, and to seek and
recover a judgment for, any portion of the Debt remaining due and payable after
the application of any proceeds of any sale of the Collateral pursuant to law.
Neither the lien nor security interest of this Mortgage, nor any rights or
remedies of Bank hereunder or under any of the Loan Documents, will be impaired
in any way by the recovery, of any judgment by Bank against Borrower or any
guarantor of the Debt, or by the levy of an execution under such judgment upon
any portion of the Collateral, until the Debt is paid in full.
24. INDEMNIFICATION. Borrower has read and does hereby approve the
legal description of the Land which is the subject of this Mortgage as set forth
on the first page of this Mortgage or in Exhibit "A" attached hereto, and hereby
indemnifies Bank, its successors or assigns, and their attorneys with respect to
any liability which might arise as a consequence of Section 697.10, Florida
Statutes, or any successors or amendments thereto.
25. RELEASES AND EXTENSIONS BY BANK. Bank, from time to time, without
notice to any person and without affecting the liability of Borrower or of any
guarantor or of any other person (other than any person expressly released by
Bank in writing) for the payment of any of the Debt, and without affecting the
priority or extent of the lien and security interest of this Mortgage (except as
to property specifically released by Bank in writing), may do any or all of the
following: (i) release in whole or in part any person liable for payment of any
or all of the Debt, or (ii) extend the time or otherwise alter the terms of
payment of the Debt, in whole or in part, or (iii) accept additional or
substitute security of any kind, or (iv) release or otherwise deal with all or
any portion of the Collateral.
26. NOTICES. Any notice or demand that must or may be given or made in
connection with this Mortgage must be in writing and, unless receipt is
expressly required, will be deemed given, delivered or made, as the case may be,
when delivered by personal delivery or the day after it is mailed by Express
Mail, by overnight delivery service of a nationally-recognized company and
addressed to the parties at the addresses written on the first page of this
Mortgage or on the signature pages of this Mortgage. Such addresses may be
changed by notice pursuant to this paragraph. Notice of change of address is
effective only upon receipt. All of the persons executing this Mortgage as
Borrower severally agree that a single notice to Borrower in the manner provided
in this paragraph will be effective to bind each such person for all purposes.
27. ESTOPPEL LETTERS. As and when, from time to time, requested by
either Borrower or Bank, and within ten (10) days after any such request,
Borrower or Bank, as the case may be, will execute and deliver to or at the
direction of Bank or Borrower, as the case may be, such estoppel letters
certifying such matters relating to this Mortgage or the Loan Documents, or
both, as may reasonably be required.
28. TRANSFER. Borrower may not sell, convey, assign, transfer or
otherwise dispose of any interest in all or any portion of the Collateral, or
any ownership interest in Borrower or any guarantor, without Bank's prior
17
written consent, which consent may be withheld in Bank's sole discretion, or as
outlined in the prospectus for public offering for Transeastern Properties,
Inc., a Florida corporation delivered to Bank by Borrower. Whether such transfer
is voluntary or involuntary, or by operation of law, any such transfer will be
void as to Bank, and constitute an immediate Default under this Mortgage,
without notice, in the sole discretion of Bank. Bank's consent to any transfer,
sale, or conveyance hereunder shall not be deemed a consent to any subsequent
transfer, sale, or conveyance for which Bank's prior written approval has not
been obtained except as provided in the Loan Agreement.
29. REPLACEMENT OF NOTE. Upon receipt of evidence reasonably
satisfactory to Borrower of the loss, theft, destruction or mutilation of the
Note, or any amendment or modification thereto, including without limitation any
renewal note or additional note, and in the case of any such loss, theft, or
destruction, upon delivery of an indemnity agreement, reasonably satisfactory to
Borrower or, in the case of any such mutilation, upon surrender of such
mutilated note, Borrower will execute and deliver, in lieu thereof, a
replacement Note, identical in form and substance to the Note and dated as of
the date of the Note and upon such execution and delivery all references in any
of the Loan Documents to the Note shall be deemed to refer to the replacement
Note.
30. FUTURE ADVANCES. This mortgage is given to secure not only the
existing Debt, but also such future advances, whether such advances are
obligatory or are to be made at the option of Bank, or otherwise, as are made
within twenty (20) years from the date hereof, to the same extent as if such
future advances were made on the date of the execution of this Mortgage. The
total amount of Debt that may be so secured may decrease or increase from time
to time, but the maximum possible principal debt so secured at one time shall
not exceed the amount shown on Page of this Mortgage, plus interest thereon, and
any disbursements made for the payment of taxes, levies or insurance on the
Mortgaged Property, with interest on such disbursements at the rate then in
effect pursuant to the terms of the Note.
31. GENERAL. The provisions of this Mortgage inure to the benefit of
Bank and its successors and assigns, and bind all persons executing this
Mortgage as Borrower and their respective legal representatives, successors and
assigns, jointly and severally, and all persons now or hereafter claiming any
right, title and interest in and to any of the property, real, personal or
mixed, tangible or intangible, now or hereafter existing or any substitutions or
replacements thereof and described in this Mortgage as the Collateral. Time is
of the essence to this Mortgage and each of its provisions. The provisions of
this Mortgage are to be interpreted, construed, applied and enforced in
accordance with the laws of the State of Florida, regardless of where this
Mortgage is executed, delivered or breached, or where any payment or other
performance required by this Mortgage is made, where any action or other
proceeding involving this Mortgage is instituted, or whether the laws of the
State of Florida otherwise would apply the laws of another jurisdiction; the
foregoing choice of law provisions will apply to the Loan Documents. The
provisions of the Loan Documents are severable at Bank's option so that if any
provision is declared by a court of competent jurisdiction to be invalid or
unenforceable, no other provision will be affected by such invalidity or
unenforceability, but will remain in force and effect according to its original
terms, if Bank so elects. Wherever used in this Mortgage or the other Loan
Documents, or both, and unless expressly provided otherwise: (i) use of the
singular includes the plural, and vice versa; (ii) use of one gender includes
all genders; (iii) use of the term "include" or "including" is always without
limitation; (iv) use of the words, "should," "must" and "will" has the same
legal effect as the use of the word "shall"; (v) the term "day" means a banking
day which shall be a day on which Bank and other banks are open for the
transaction of business, excluding any national holidays, and any performance
which would otherwise be required on a day other than a banking day shall be
timely performed in such instance, if performed on the next succeeding banking
day; (vi) any definition herein incorporating one or more documents or items
shall refer to such items "singularly and collectively", and (vii) "person"
means any natural person or artificial entity having legal capacity. Paragraph
headings and subheadings are for indexing purposes only and are not to be used
to interpret, construe, apply or enforce the provisions of this Mortgage.
Borrower and Bank intend the provisions of this Mortgage and the other Loan
Documents to be interpreted, construed, applied and enforced so as to avoid
inconsistencies or conflicting results; but if any such inconsistency or
conflict necessarily occurs, Borrower and Bank intend that the provisions of the
Loan Agreement
18
control unless otherwise provided therein. This Mortgage may be
amended only by a written instrument executed by Borrower and Bank with the same
formalities as this Mortgage.
32. SATISFACTION. The lien and security interest provided by the Loan
Documents will continue unimpaired and in full force and effect unless and until
the Debt is paid in full, whereupon such lien and security interest will be
without further force or effect. Until this Mortgage shall be satisfied of
record, Borrower hereby waives for itself, and all subsequent successors in
title to the mortgaged Property, any right it may now have or hereafter have,
pursuant to Florida Statutes 697.04 (1).(b), as amended from time to time, to
file for record a notice limiting the maximum amount which may be secured by
this Mortgage.
33. DEPOSITS. Bank may, at its sole option upon occurrence of a
Default, require Borrower to make monthly deposits with Bank of a sum equivalent
to one-twelfth (1/12) of the annual real and tangible personal property taxes
assessed with respect to the Mortgaged Property and one-twelfth (1/12) of the
annual premiums for all insurance required to be maintained by this Mortgage. In
addition, upon occurrence of a Default, if required by Bank, Borrower shall also
deposit with Bank a sum of money which, together with the aforesaid monthly
deposits, will be sufficient to make each of such payments for taxes and
insurance at least ten (10) days prior to the date such payments are due. The
amount of such taxes, assessments, and premiums, when unknown, will be estimated
by Bank in good faith. Such deposits may be commingled with Bank's general
funds; Bank will not be liable for any interest on account of such deposits. To
the extent sufficient, such deposits will be applied by Bank to the payment of
such taxes, assessments, and premiums, when due, upon Borrower's presentation of
bills therefor; but Bank will have no obligation to make any such payment except
to the extent of such deposits. Any insufficiency of such deposits will be paid
by Borrower to Bank on demand. Upon any Default by Borrower under this Mortgage,
Bank may apply all such deposits to the Debt in such order as Bank may elect.
The enforceability of Borrower's covenants relating to taxes, assessments, and
insurance provided in this Mortgage will not be altered, diminished, impaired,
or otherwise affected by the provisions of this paragraph except insofar as such
obligations are actually met by Borrower's compliance with this paragraph. Bank
from time to time, at its sole option, may waive and, after any such waiver,
reinstate any or all of the provisions of this paragraph. While any such waiver
is in effect, Borrower will pay all taxes, assessments, and insurance premiums
as provided elsewhere in this Mortgage.
34. BORROWER AS TENANT HOLDING OVER. In the event of a foreclosure
sale of the Mortgaged Property, Borrower shall be deemed a tenant holding over
and shall forthwith deliver possession to Bank or any purchaser or purchasers at
such sale or be summarily dispossessed according to provisions of the law of the
State of Florida applicable to tenants holding over.
35. TIME OF THE ESSENCE. Time is of the essence with respect to each
and every covenant, agreement, and obligation of Borrower under this Mortgage
and the other Loan Documents, and any and all other instruments now or hereafter
evidencing, securing or otherwise relating to the Loan.
36. ORAL MODIFICATION INEFFECTIVE. No term of this Mortgage or any
other of the Loan Documents, or such documents, may be waived, changed,
modified, discharged, or terminated except by an instrument in writing signed by
the party against which enforcement of the waiver, change, modification,
discharge, or termination is sought.
37. HAZARDOUS SUBSTANCES. Borrower hereby represents and warrants to
Bank: (a) that neither Borrower nor any of its subsidiaries is in violation of
any judgment, decree, order, law, license, rule, or regulation pertaining to
environmental matters, including, without limitation, those arising under the
Resource Conservation and Recovery Act ("RCRA"), the Comprehensive Environmental
Response, Compensation, and Liability Act of 1980 as amended ("CERCLA"), the
Superfund Amendments and Reauthorization Act of 1986 ("XXXX"), the Federal Water
Pollution Control Act, the Toxic Substances Control Act, or any state or local
statute, regulation, ordinance, order, or decree relating to health, safety, or
the environment (hereinafter "Environmental
19
Laws); (b) that neither Borrower nor any of its subsidiaries has received notice
that it or any of its tenants has been identified by the United States
Environmental Protection Agency as a potentially responsible party under CERCLA
with respect to a site listed on the National Priorities List, 40 C.F.R. Part
000 Xxxxxxxx X (1986); nor has Borrower or any of its subsidiaries received any
notification that any hazardous waste, as defined by 42 U.S.C. ss.6093(5), any
hazardous substances as defined by 42 U.S.C. ss.9601(14), any "pollutant or
contaminant" as defined by 42 U.S.C. ss.9601(33) and any toxic substance,
hazardous materials, oil or other chemicals or substances regulated by any
Environmental Laws ("Hazardous Substances") which it has disposed of has been
found at any site on which a federal or state agency is conducting a remedial
investigation or other action pursuant to any Environmental Law; (c) (i) to the
best of Borrower's knowledge except as disclosed in the Phase I and II
Environmental Report prepared for Bank and Borrower by Law Engineering and
Environmental Services, Inc., a Florida corporation dated November 7, 1995, no
portion of the Mortgaged Property has been used for the handling, processing,
storage, or disposal of Hazardous Substances and no underground tank or other
underground storage receptacle for Hazardous Substances is located on the
Mortgaged Property, (ii) in the course of its activities, neither Borrower nor
any of its subsidiaries has generated or is generating any hazardous waste on
the Mortgaged Property, (iii) to the best of our knowledge there have been no
releases (i.e., any past or present releasing, spilling, leaking, pumping,
pouring, emitting, emptying, discharging, injecting, escaping, leaching,
disposing, or dumping) of Hazardous Substances by Borrower or any of its
subsidiaries on, upon, or into the Mortgaged Property, which releases would have
a material adverse effect on the value of the Mortgaged Property. In addition,
to the best of Borrower's knowledge, there have been no such releases on, upon,
or into any real property in the vicinity of the Mortgaged Property which,
through soil or groundwater contamination, may have come to be located on the
Mortgaged Property; (d) to the best of Borrower's knowledge, that no asbestos,
oil, petroleum or chemical liquids or solids, liquid or gaseous products, or
hazardous or toxic substances, within the meaning of any applicable statute or
regulation, are presently stored or otherwise located on or under the Mortgaged
Property or on or under any adjacent and contiguous real property owned by
Borrower or any related entity or affiliate of Borrower; (e) to the best of
Borrower's knowledge, that no release of any such hazardous or toxic substance
has occurred on the Mortgaged Property or on any adjacent and contiguous real
property owned by Borrower or any related entity or affiliate of Borrower; (f)
to the best of Borrower's knowledge, that no part of the Mortgaged Property or
any adjacent and contiguous real property owned by Borrower or any related
entity or affiliate of Borrower, including the groundwater located thereon, is
presently contaminated by such hazardous or toxic substance; and (g) that
Borrower has not received any notice from any governmental agency or authority
or from any tenant under a lease with respect to any such release of hazardous
or toxic materials onto the Mortgaged Property or adjacent parcels of real
property. Borrower further covenants and agrees with Bank that, throughout the
term of the Note: (h) the Mortgaged Property shall be operated and maintained in
compliance with all applicable governmental or regulatory requirements; (i)
Borrower shall maintain or procure all necessary permits, licenses, and
certificates required by federal, state, and local laws throughout the Loan
term; (j) all hazardous or toxic substances, within the definition of any
applicable statute or regulation, which may be used by any person for any
purpose upon the Mortgaged Property, shall be used or stored thereon only in a
safe and approved manner, in accordance with all industrial standards and all
laws, regulations and requirements for such storage promulgated by any
applicable governmental agency or authority; (k) other than as described in (j)
above, the Mortgaged Property will not be used for the purpose of storing such
substances; and (1) other than as described in above, no such storage or use
will otherwise be allowed on the Mortgaged Property (whether through leases with
tenants who might store or use hazardous substances or otherwise) which will
cause, or which will increase the likelihood of causing, the release of such
hazardous or toxic substances onto the Mortgaged Property. Borrower shall
immediately notify Bank of any failure to comply under this paragraph or receipt
of an notice of violation or third party complaint. Borrower hereby agrees to
indemnify and save and hold Bank harmless of and from all claims, damages, loss,
liabilities, penalties, fines, remedial action requirements, and enforcement
actions, along with the costs and attorneys' fees incurred by Bank in defending
Borrower's use, generation, transportation, and disposal, release, or threatened
release of hazardous substances, including without limitation, asbestos
containing materials or damage whatsoever incurred by Bank arising out of or by
reason of any violation of any applicable statute or regulation for the
protection of the environment which occurs upon the Mortgaged Property, or by
reason of the imposition of any governmental lien for the recovery of
environmental clean-up costs expended by reason of such violation, including
without limitation any lien arising pursuant to any so-called "Super Fund" or
"Super Lien" legislation; provided, however, that to the extent that Bank is
strictly liable under any such
20
statute or regulation, Borrower's obligation to Bank under this indemnity shall
likewise be without regard to fault on the part of Borrower with respect to the
violation of law which results in liability to Bank. A default under this
paragraph shall constitute a Default under this Mortgage subject to any cure
periods set forth in the Loan Agreement. It is expressly acknowledged by
Borrower that this indemnification shall survive in accordance with the terms
and conditions set forth in the Hazardous Substance Certificate and
Indemnification Agreement of even date herewith executed by the Borrower and
Guarantor.
38. ENVIRONMENTAL ASSESSMENTS. At any time deemed necessary by Bank,
in its reasonable and sound business judgment, Bank may, at 'its election,
obtain one or more environmental assessments of the Mortgaged Property prepared
by a geohydrologist, an independent engineer, or other qualified consultant or
expert approved by Bank evaluating or confirming (i) whether any Hazardous
Substances are present in the soil or water at the Mortgaged Property and (ii)
whether the use and operation of the Mortgaged Property comply with all
applicable Environmental Laws relating to air quality, environmental control,
release of oil, hazardous materials, hazardous wastes and hazardous substances,
and any and all other applicable environmental laws. Environmental assessments
may include detailed visual inspections of the Mortgaged Property including,
without limitation, any and all storage areas, storage tanks, drains, dry xxxxx,
and leaching areas, and the taking of soil samples, surface water samples, and
ground water samples, as well as such other investigations or analyses as are
necessary or appropriate for a complete determination of the compliance of the
Mortgaged Property and the use and operation thereof with all applicable
Environmental Laws. All such environmental assessments shall be at the sole cost
and expense of Borrower. In the event it is determined that additional tests
and/or remediation are necessary as a result of the aforesaid assessments, or in
the event such additional testing or remediation is recommended by the aforesaid
assessments, the Borrower agrees to immediately perform the tests or undertake
the remediation as recommended. In the event contamination or an environmental
problem is found on the Mortgaged Property, the Borrower shall be in Default
hereunder after a thirty (30) day cure period.
39. SUBROGATION. To the extent of the indebtedness of the Borrower to
the Bank described herein or secured hereby, the Bank is hereby subrogated to
the lien or liens and to the rights of the owners and holders of each and every
mortgage, lien or other encumbrance on the land described herein which is paid
and/or satisfied, in whole or in part, out of the proceeds of the loan described
herein or secured hereby, and the respective liens of said mortgages, liens or
other encumbrances, shall be and the same and each of them hereby is preserved
and shall pass to and be held by the Bank herein as security for the
indebtedness to the Bank herein described or hereby secured, to the same extent
that it would have been preserved and would have been passed to and been held by
the Bank had it been duly and regularly assigned, transferred, set over, and
delivered unto the Bank by separate deed of assignment, notwithstanding the fact
that the same may be satisfied and canceled of record, it being the intention of
the parties hereto that the same will be satisfied and canceled of record by the
holders thereof at or about the time of the recording of this Mortgage.
40. MANDATORY ARBITRATION. Any controversy or claim between or among
the parties hereto including but not limited to those arising out of or relating
to this Agreement or any related agreements or instruments, including any claim
based on or arising from an alleged tort, shall be determined by binding
arbitration in accordance with the Federal Arbitration Act (or if not
applicable, the applicable state law), the Rules of Practice and Procedure for
the Arbitration of Commercial Disputes of Judicial Arbitration and Mediation
Services, Inc. (J.A.M.S.), and the "Special Rules" set forth below. In the event
of any inconsistency, the Special Rules shall control. Judgment upon any
arbitration award may be entered in any court having jurisdiction. Any party to
this Agreement may bring an action, including a summary or expedited proceeding,
to compel arbitration of any controversy or claim to which this agreement
applies in any court having jurisdiction over such action.
a. SPECIAL RULES. The arbitration shall be conducted in the
County of Broward, Florida and administered by Endispute, Inc., d/b/a
J.A.M.S., who will appoint an arbitrator; if J.A.M.S./Endisp- ute is
unable or legally precluded from administering the arbitration, then
the American Arbitration Association will serve. All arbitration
hearings will be commenced within 90 days of the demand for
arbitration;
21
further, the arbitrator shall only, upon a showing of cause, be
permitted to extend the commencement of such hearing for up to an
additional sixty 60 days.
b. RESERVATION OF RIGHTS. Nothing in this Agreement shall be
deemed to (i) limit the applicability of any otherwise applicable
statutes of limitation or repose and any waivers contained in this
Agreement; or (ii) be a waiver by the Bank of the protection afforded
to it by 12 U.S.C. Sec. 91 or any substantially equivalent state law;
or (iii) limit the right of the bank hereto (A) to exercise self help
remedies such as (but not limited to) setoff, or (B) to foreclose
against any real or personal property collateral, or (C) to obtain from
a court provisional or ancillary remedies such as (but not limited to)
injunctive relief or the appointment of a receiver. The Bank may
exercise such self help rights, foreclose upon such property, or obtain
such provisional or ancillary remedies before, during or after the
pendency of any arbitration proceeding brought pursuant to this
Agreement. At Bank's option, foreclosure under a deed of trust or
mortgage may be accomplished by any of the following: the exercise of a
power of sale under the deed of trust or mortgage, or by judicial sale
under the deed of trust or mortgage, or by judicial foreclosure.
Neither this exercise of self help remedies nor the institution or
maintenance of an action for foreclosure or provisional or ancillary
remedies shall constitute a waiver of the right of any party, including
the claimant in any such action, to arbitrate the merits of the
controversy or claim occasioning resort to such remedies.
41. CROSS-DEFAULT. This Loan shall be cross-defaulted with other loans
by Bank to Borrower as more specifically described in the Loan Agreement.
42. RELEASE PROVISION. Provided that Borrower is not then in Default
hereunder, under the Construction Line, the Mortgage or any other Loan Document,
Bank will provide partial releases of Units from the lien of the Mortgage upon
the following terms:
a. If the partial release relates to developed lots in
connection with a bona fide sale or construction loan on which no home
construction advances have been made:
i. Bank shall be given written notice of the request for
each partial release at least five (5) business days prior to each
partial release.
ii. The cost of each partial release shall be paid by
Borrower.
iii. Contemporaneously with the delivery to Borrower of each
partial release, Borrower shall prepay principal in an amount
equal to the amount advanced upon such lot plus accrued interest
thereon.
b. If the partial release relates to Units for which advances of
Construction Line proceeds have been made, Borrower shall prepay
principal of the Construction Line in an amount equivalent to the total
actual amount advanced by Bank under the Construction Line on account
of the Unit to be released, together with interest accrued thereon
("Unit Release Price") and the applicable Lot Release Price.
IN WITNESS WHEREOF, Borrower has executed and delivered this Mortgage as of
the date stated above.
Signed, sealed and delivered
in the presence of: TRANSEASTERN PEMBROKE VILLAGES, INC., A
FLORIDA CORPORATION
____________________________
22
Witness #1 By __________________________________(SEAL)
Xxxxxx Xxxxxxx, Executive Vice President
____________________________
Print Name
____________________________ Address:
Witness #1
0000 Xxxxxxxxxx Xxxxx
____________________________ Xxxxx Xxxxxxx, Xxxxxxx 00000
Print Name
STATE OF FLORIDA )
)ss
COUNTY OF BROWARD )
The foregoing instrument was acknowledged before me this ____ day of
September, 1996, by XXXXXX XXXXXXX, as Executive Vice President of TRANSEASTERN
PEMBROKE VILLAGES, INC., a Florida corporation, by and on behalf the
corporation. He is personally known to me and/or has produced
________________________________ as identification.
My Commission Expires: ___________________________________________
NOTARY PUBLIC STATE OF FLORIDA
___________________________________________
Print Name
23
This Instrument Prepared by:
Xxxxxxx X. Xxxx, Esq.
Xxxxxxx Xxxxxxx & Xxxxx Xxxxx
0000 Xxxxxxx Xxxx, Xxx. 000
Xxxxx Xxxxx, Xxxxxxx 00000
Loan No. 91000839
AMENDED AND RESTATED REAL ESTATE MORTGAGE
ASSIGNMENT AND SECURITY AGREEMENT
THIS AMENDED AND RESTATED REAL ESTATE MORTGAGE ASSIGNMENT AND SECURITY
AGREEMENT ("Mortgage") is made this ____ day of September, 1996, by and between
TRANSEASTERN PEMBROKE VILLAGES, INC., A FLORIDA CORPORATION (the " Borrower"),
having a post office address at 0000 Xxxxxxxxxx Xxxxx, Xxxxx Xxxxxxx, Xxxxxxx
00000 and CHASE FEDERAL BANK, A FEDERAL SAVINGS BANK, A DIVISION OF NATIONSBANK,
N.A. (SOUTH), F/K/A CHASE FEDERAL BANK, A FEDERAL SAVINGS BANK, (the " Bank"),
having a post office address at 000 Xxxxxxx Xxxxx Xxxx, Xxxxx 000, Xx.
Xxxxxxxxxx, Xxxxxxx 00000.
R E C I T A L S:
WHEREAS, on March 29, 1996, Borrower executed and delivered that
certain promissory note in the original principal amount of TEN MILLION ONE
HUNDRED FIFTY THOUSAND AND NO/100 DOLLARS ($10,150,000.00) ("Original Note") in
favor of Bank, which Original Note is secured, inter alia, by that certain
mortgage and security agreement recorded in Official Records Book 24694, at Page
0702 of the Public Records of Broward County, Florida ("Original Mortgage"); and
WHEREAS, the Original Mortgage encumbers that certain real property
lying, being and situated in Broward County, Florida, more particularly
described on Exhibit "A" attached hereto and made a part hereof ("Mortgaged
Property"); and
WHEREAS, simultaneously herewith, Borrower executed and delivered that
certain demand promissory note in the original promissory amount of THREE
MILLION FIVE HUNDRED EIGHTY SEVEN THOUSAND FIVE HUNDRED AND NO/100 DOLLARS
($3,587,500.00) ("Note No. 2") in favor of Bank; and
WHEREAS, the parties desire that Original Note and Note No. 2 be
consolidated, amended, restated and superseded to that certain consolidated
promissory note dated of even date herewith ("Consolidated Promissory Note",
"Promissory Note" or "Note"), and the outstanding principal balance represented
thereby to be repaid in accordance with the terms and provisions of the
Consolidated Promissory Note; and
DOCUMENTARY STAMPS AND INTANGIBLE TAXES HAVE BEEN PAID
ON $3,587,500.00, WHICH IS THE AMOUNT BEING ADVANCED UNDER
NOTE NO. 2 DESCRIBED IN THIS AGREEMENT.
WHEREAS, Mortgagor and Bank desire to amend and restate the Original
Mortgage to provide for the agreed upon amendments thereto, including, but not
limited to, securing all indebtedness owed by Mortgagor to Mortgagee under the
Consolidated Promissory Note.
NOW THEREFORE, in consideration of the sum of TEN AND NO/100 DOLLARS
($10.00) and other good and valuable consideration, receipt, adequacy and
sufficiency of which is hereby acknowledged, the Mortgagor and Mortgagee
intending to be legally bound do hereby agree as follows, to wit:
1. The recitations set forth in the preamble of this Mortgage are true
and correct and incorporated herein by this reference.
2. The Original Mortgage is hereby modified and restated in its
entirety as follows:
REAL ESTATE MORTGAGE, ASSIGNMENT,
AND SECURITY AGREEMENT,
(THE "MORTGAGE")
DATE: September ___, 1996
BORROWER:
TRANSEASTERN PEMBROKE VILLAGES, INC., A FLORIDA CORPORATION
0000 Xxxxxxxxxx Xxxxx
Xxxxx Xxxxxxx, Xxxxxxx 00000
BANK:
CHASE FEDERAL BANK, F.S.B., A DIVISION OF NATIONSBANK, N.A. (SOUTH),
a national banking association
000 Xxxx Xxxxxxx Xxxxx Xxxx
Xxxxx 000
Xxxx Xxxxxxxxxx, XX 00000
AMOUNT OF INITIAL LOAN SECURED HEREBY: $8,737,500.00
MAXIMUM POSSIBLE PRINCIPAL DEBT, INCLUDING FUTURE ADVANCES, THAT MAY BE SECURED
HEREBY: $18,692,000.00
LAND: Those certain parcels of Land commonly referred to as Parcel "D"and
Parcel "F" contained within the Nasher Plat, as recorded in Plat Book
159 at Page 42 of the Public Records of Broward County, Florida, and
more particularly described on Exhibit "A" attached hereto and
incorporated herein by reference.
1. MORTGAGE. In consideration of Ten Dollars ($10.00) and other
valuable consideration received by Borrower, the receipt and sufficiency of
which are hereby acknowledged, Borrower hereby grants, bargains, sells, assigns,
transfers, conveys and mortgages to Bank, its successors and assigns, to its own
proper use and benefit forever, subject to the terms and conditions of this
Mortgage, the real estate described above as the Land, together with:
a. APPURTENANCES. The benefit of all easements and other rights of
any nature whatsoever, if any, appurtenant to the Land or the
Improvements, or both, the benefit of all rights-of-way, strips and
gores of land, streets, alleys, passages, drainage rights, sanitary
sewer and potable water rights, stormwater
2
drainage rights, rights of ingress and egress to the Land and all
adjoining property, and any improvements of Borrower now or hereafter
located on any of such real property interests, water rights and
powers, oil, gas, mineral and riparian and littoral rights, whether now
existing or hereafter arising, together with the reversion or
reversions, remainder or remainders, rents, issues, incomes and profits
of any of the foregoing (the "Appurtenances").
b. IMPROVEMENTS. All buildings, structures, betterments and other
improvements of any nature now or hereafter situated in whole or in
part upon the Land or on the Appurtenances, regardless of whether
physically affixed thereto or severed or capable of severance therefrom
(the "Improvements").
c. TANGIBLE PROPERTY. All of Borrower's right, title and interest,
if any, in and to all fixtures, equipment and tangible personal
property of any nature whatsoever that is now or hereafter (i) attached
or affixed to the Land, the Appurtenances, or the Improvements, or (ii)
situated upon or about the Land, the Appurtenances and/or the
Improvements, regardless of whether physically affixed thereto or
severed or capable of severance therefrom, or (iii) used, regardless of
where situated, if used, usable or intended to be used, in connection
with any present or future use or operation of or upon the Land. The
foregoing includes: all goods and inventory, all heating, air
conditioning, lighting, incinerating and power equipment; all engines,
compressors, pipes, pumps, tanks, motors, conduits, wiring, and
switchboards; all plumbing, lifting, cleaning, fire prevention, fire
extinguishing, refrigerating, ventilating, and communications and
public address apparatus; all signage and recreational amenities
including, without limitation, swimming pools, exercise equipment,
tennis courts, clubhouse furnishings or saunas; all boilers, furnaces,
oil burners, vacuum cleaning systems, elevators and escalators; all
stoves, ovens, ranges, disposal units, dishwashers, water heaters,
exhaust systems, refrigerators, cabinets, and partitions; all rugs,
draperies and carpets; all laundry equipment; all building materials;
all furniture (including, without limitation, any outdoor furniture) ,
furnishings, office equipment and office supplies; and all additions,
accessions, renewals, replacements and substitutions of any or all of
the foregoing. The property interests encumbered and described by this
paragraph are called the "Tangible Property" in this Mortgage.
d. All rents, issues, incomes and profits in any manner arising from
the Land, Improvements, Appurtenances or Tangible Property, or any
combination thereof, including Borrower's interest in and to all leases
of whatsoever kind or nature, licenses, franchises and concessions of
or relating to all or any portion of the Land, Appurtenances,
Improvements or Tangible Property,or the operation thereof, whether now
existing or hereafter made, including all amendments, modifications,
replacements, substitutions, extensions, renewals or consolidations
thereof. The property interests encumbered and described in this
subparagraph are called the "Rents" in this Mortgage.
e. SECONDARY FINANCING. All of the Borrower's rights, power or
privilege to further encumber any of the Collateral described in this
paragraph 1, it being intended by this provision to divest Borrower of
the power to encumber or to grant a security interest in any of the
Collateral as security for the performance of an obligation, except for
"Permitted Encumbrances," as defined in paragraph 5 herein.
f. PROCEEDS. All proceeds of the conversion, voluntary or
involuntary, of any of the property encumbered by this Mortgage into
cash or other liquidated claims, or that are otherwise payable for
injury to or the taking or requisitioning of any such property,
including all judgments, settlements and insurance and condemnation
proceeds as provided in this Mortgage.
g. CONTRACT RIGHTS. All of Borrower's right, title and interest in
and to any and all contracts or leases, written or oral, express or
implied, now existing or hereafter entered into or arising, in any
matter related to the improvement, use, operation, sale, conversion or
other disposition of any interest in the Land, Appurtenances,
Improvements, Tangible Property or the Rents, or any combination
thereof, including all tenant leases, sales contracts, payments due and
to become due thereunder; and
3
including, without limitation, contracts pertaining to maintenance,
on-site security service, elevator maintenance, landscaping services,
building or project management, marketing, leasing, sale and janitorial
services; Borrower's interest as lessee in equipment leases, including
telecommunications, computers, vending machines, model furniture,
televisions, laundry equipment; and Borrower's interests in
construction contracts or documents (including architectural and
engineering drawings and plans and specifications relating to the
Improvements), service contracts, use and access agreements,
advertising contracts and purchase orders. The property interest
encumbered and described in this paragraph are called the "Contract
Rights" in this Mortgage. Notwithstanding the foregoing, Bank will not
be bound by any of Borrower's obligations under any of the foregoing
contracts unless and until Bank elects to assume any of such contracts
or leases in writing.
h. NAME. All right, title and interest of Borrower in and to all
trade names, project names, logos, service marks, trademarks, goodwill,
and slogans now or hereafter used in connection with the operation of
the Mortgaged Property except the name of Transeastern Properties,
Inc., a Florida corporation, f/k/a Transeastern Properties of South
Florida, Inc., a Florida corporation.
i. OTHER INTANGIBLES. All contract rights, commissions, money,
deposits, certificates of deposit, letters of credit, documents,
instruments, chattel paper, accounts, and general intangibles [as such
terms from time to time are defined in the Uniform Commercial Code as
adopted by the State of Florida (the "Uniform Commercial Code"], in any
manner related to the construction, use, operation, sale, conversion or
other disposition (voluntary or involuntary) of the Land,
Appurtenances, Improvements, Tangible Property or Rents, including all
construction plans and specifications, architectural plans, engineering
plans and specifications, permits, governmental or quasi-governmental
approvals, licenses, developer rights, vested rights under any Planned
Unit Development or Development of Regional Impact or other project,
zoning, or land use approval, insurance policies, rights of action and
other choice in action.
The Land, Appurtenances, Improvements and Tangible Property are
collectively referred to as the "Mortgaged Property" in this Mortgage.
The portion of the property encumbered by this Mortgage that from time
to time consists of intangible personal property, except for the Rents,
is called the "Intangible Property" in this Mortgage. The Mortgaged
Property, Rents, Intangible Property and any other property interests
encumbered hereby are hereinafter referred to collectively as the
"Collateral". Wherever used in this Mortgage, the use of the terms,
"Mortgaged Property," "Rents", "Intangible Property", and "Collateral"
means and includes all or any portion thereof applicable to the
context.
Notwithstanding the grant of Borrower's interest in the Rents and
Contract Rights above, so long as no Default shall exist hereunder or
under any of the other Loan Documents, Borrower shall have a license to
collect and receive all incomes arising from the operation, ownership,
and maintenance of the Mortgaged Property, Rents and Contract Rights,
but not more than one (1) month prior to accrual.
2. SECURITY AGREEMENT. To the extent any of the Collateral encumbered
by this Mortgage from time to time constitutes personal property subject to the
provisions of the Uniform Commercial Code, this Mortgage constitutes a "Security
Agreement" for all purposes under the Uniform Commercial Code. Without
limitation, Bank, at its election, upon the occurrence of a Default under this
Mortgage, will have all rights, powers, privileges and remedies from time to
time available to a secured party under the provisions of the Uniform Commercial
Code with respect to the Collateral. The names and addresses of debtor and
secured party are as shown for Borrower and Bank, respectively, on the signature
pages hereof. The remedies for any Default under the covenants, terms, and
conditions of the security agreement herein contained shall be (i) as prescribed
herein, or (ii) as prescribed by general law, or (iii) as prescribed by the
specific statutory provisions now or hereafter enacted and specified in the
Uniform Commercial Code, all at Bank's sole election. Borrower and Bank agree
that the filing of financing statements in the records normally having to do
with personal property shall never be
4
construed as in anywise derogating from or impairing this declaration and hereby
stated intention of Borrower and Bank that everything used in connection with
the production of income from the Collateral or adapted for use therein or which
is described or reflected in this Mortgage, is, and at all times and for all
purposes and in all proceedings both legal or equitable shall be, regarded as
part of the real estate irrespective of whether (i) any such item is physically
attached to the Improvements, (ii) serial numbers are used for the better
identification of certain items capable of being thus identified in a recital
contained herein, or (iii) any such item is referred to or reflected in any
financing statement(s) so filed at any time. Similarly, the mention in any
financing statement of the rights in, or the proceeds of, any fire, hazard or
liability insurance policy, or any award in eminent domain proceedings for a
taking or for loss of value, or Borrower's interest as lessor in any present or
future lease, or rights to income growing out of the use of the Mortgaged
Property, whether pursuant to a lease or otherwise, shall not be construed as
altering any of Bank's rights as determined by this Mortgage, or otherwise
available at law or in equity, or impugning the priority of this Mortgage or the
Loan Documents, or both, but such mention in any financing statement is declared
to be for Bank's protection if, as, and when any court holds that notice of
Bank's priority of interest, to be effective against a particular class of
persons, including the federal government and any subdivisions or entities of
the federal government, must be perfected in the manner required by the Uniform
Commercial Code.
Borrower covenants and agrees that Borrower will furnish Bank with
notice of any change in name, identity, organizational structure, mailing
address, residence, or principal place of business thirty (30) days prior to the
effective date of any such change. Borrower will promptly execute any financing
statements or other instruments deemed necessary by Bank to prevent any filed
financing statement from becoming misleading or losing its perfected status or
to reinstate any lapsed financing statement.
3. AFTER-ACQUIRED PROPERTY. Without the necessity of any further act of
Borrower or Bank, the lien of and security interest created by this Mortgage
automatically will extend to and include (i) any and all renewals, replacements,
substitutions, accessions, proceeds, products, additions or after-acquired
property or to the Collateral, and (ii) any and all monies, proceeds and other
property that from time to time, either by delivery to Borrower or by any
instrument (including this Mortgage) may be subjected to such lien and security
interest by Borrower or by anyone on behalf of Borrower, or with the consent of
Borrower, or which otherwise may come into the possession or otherwise be
subjected to the control of Bank or Borrower pursuant to this Mortgage or the
other Loan Documents.
4. DEBT. Borrower is justly indebted to Bank in the principal amount
indicated above (or so much as may be advanced to Borrower by Bank from time to
time), as evidenced by that certain Promissory Note in the original principal
amount of EIGHT MILLION SEVEN HUNDRED THIRTY SEVEN FIVE HUNDRED AND NO/100
DOLLARS ($8,737,500.00), of even date herewith, made by Borrower, payable to the
order of Bank and maturing as stated in said Notes, unless such maturity is
accelerated or extended (as provided in said Notes) , which Notes, together with
any and all renewals, replacements, extensions, modifications, substitutions,
future advances, and any and all other certificates or evidence of indebtedness
evidenced by said Notes are herein called the "Note".
Borrower's obligations described below are secured, among other things,
by the collateral described in this Mortgage, which term includes any and all
amendments, extensions, renewals, replacements, substitutions, modifications and
consolidations of this Mortgage, and may also from time to time be secured by
other collateral described in written documents. The Mortgage and such other
documents as may exist on the date hereof or may exist hereafter are referred to
as the "Security Documents," which term, as defined in the Note, includes any
and all financing statements, letters of credit, assignments, agreements,
supplements, and riders made and delivered in connection with the Note and this
Mortgage, and any and all amendments, modifications, extensions, renewals,
replacements, substitutions and consolidations thereof or thereto. The Security
Documents, the Note and the Loan Agreement between Borrower and Bank are
referred to collectively as the "Loan Documents". The Loan evidenced by the Note
and secured by this Mortgage is to be disbursed in accordance with the terms and
provisions of a Loan Agreement of even date herewith between Borrower and Bank
(the "Loan Agreement"). The Note, the Mortgage and the Loan Agreement shall
always be taken and read together as constituting part of one transaction. All
sums
5
disbursed pursuant to the terms of the Loan Agreement shall be secured by this
Mortgage with the same priority as if advanced on the date hereof.
The obligations of Borrower secured by the Security Documents arising
pursuant to the Loan Documents are as follows and are called the "Debt" in this
Mortgage and the other Loan Documents:
a. NOTE. Borrower's payment of all sums due from time to time as
evidenced by the Note; and
b. LOAN DOCUMENTS. Borrower's payment or performance of all
obligations imposed upon Borrower by the Loan Documents; and
c. ADVANCES. All sums advanced by Bank to or for the benefit of
Borrower in the manner provided in the Loan Documents, or for the
protection of the Security of the Collateral, including, without
limitation, all sums advanced pursuant to this Mortgage, including
advances for repairs, maintenance, insurance, taxes, or assessments;
and
d. COSTS. All costs, expenses, losses, damages and other charges
sustained or incurred by Bank because of: (i) Borrower's Default in
payment or performance, as the case may be, of any provision contained
in the Loan Documents; (ii) defense of actions instituted by Borrower
or a third party against Bank arising out of or related to the Loan, or
in the realizing upon, protecting, perfecting, defending, or (iii)
actions brought or defended by Bank enforcing Bank's security interest
in the Collateral. All of these costs and expenses include reasonable
attorneys' fees, paralegals' fees, or legal assistants' fees, whether
incurred with respect to collection, litigation, bankruptcy proceedings
interpretation dispute, negotiation, trial, appeal, defense of actions
instituted by a third party against Bank, or enforcement of any
judgment based on the Loan Documents, whether or not suit is brought to
collect such amounts or to enforce such rights or, if brought, is
prosecuted to judgment.
e. LETTERS OF CREDIT. All sums advanced by Bank for the benefit of
Borrower under any other instrument or otherwise, including, without
limitation, any amounts paid by Bank under any letters of credit issued
by Bank for the benefit of Borrower.
f. MISCELLANEOUS EXPENSES. All costs and expenses incurred by Bank
in connection with the Loan, whether prior to or at closing or during
the term thereof, including, without limitation, loan origination fees,
commitment fees, extension fees, title insurance search fees, premiums
and endorsement fees, hazard and other insurance required by the Loan
Documents, pre-closing and post-closing appraisals, appraisal reports
or opinions of value, surveys, brokerage commissions and claims of
brokerage in connection with the Loan, ad valorem and personal property
taxes, documentary stamp taxes and intangible taxes, attorneys' fees,
consultant fees, architect's and engineer's fees, construction
consultant's fees, environmental surveys or assessments, and recording
charges.
g. INDEMNITIES. All costs, expenses, and amounts arising under or
pursuant to any indemnity contained within the Loan Documents or in any
separate agreement executed by Borrower in favor of Bank including,
without limitation, the Hazardous Substance Certificate and
Indemnifica- tion Agreement (the "Indemnity").
5. TITLE WARRANTIES. Subject to the Permitted Encumbrances (as
hereinafter defined) , Borrower covenants with Bank that: (i) Borrower is
indefeasibly seized of the Land and Improvements in fee simple, has good and
marketable title to the Collateral and has full power, lawful right and
authority to convey the same in fee simple and to grant Bank a perfected first
lien security interest in the Collateral, and (ii) the Collateral is free and
clear of all liens, encumbrances, restrictions, and security interests of any
nature except for those permitted
6
encumbrances which Bank has previously approved, as set out in Schedule B of the
title insurance policy and endorsements insuring this Mortgage, which are
referred to as "Permitted Encumbrances" in this Mortgage.
6. LIENS. Except as otherwise provided in the Loan Agreement, Borrower
will not create or permit to be created, or to remain, and will promptly
discharge at Borrower's expense any and all liens or encumbrances upon, or
security interests in, the Collateral, or any combination thereof, whether
consensual, common law, statutory, voluntary, involuntary, or arising by
operation of law, except Permitted Encumbrances. Notwithstanding the foregoing,
and except for any construction liens, Borrower may contest the amount, validity
and enforceability of any involuntary or nonconsensual lien, encumbrance or
security interest, including those arising by operation of law, in the manner
provided in paragraph 8 below. Except as otherwise provided in the Loan
Agreement, if any construction lien is filed against the Mortgaged Property,
Borrower agrees to discharge or otherwise remove such lien by bond or otherwise,
within thirty (30) days of imposition of same, but may thereafter contest the
amount or validity of such lien as provided in paragraph 8 below.
7. TAXES AND OTHER IMPOSITIONS. Borrower will pay or cause to be paid,
prior to any delinquency in (i) all property taxes, assessments, water, sewer,
utility and other rents, rates and charges, including all excises, taxes,
levies, license fees, permit fees, impact fees, connection fees, and other fees
and charges, whether general or special, ordinary or extraordinary, foreseen or
unforeseen, that may be assessed, levied or imposed upon the Collateral, or
otherwise arising with respect to the occupancy, use, possession or disposition
thereof, whether or not the failure to pay the same might result in the creation
of a lien upon the Collateral, or any combination thereof; (ii) all franchise,
excise and other taxes, fees and charges assessed, levied or imposed with
respect to Borrower's right to do business in the State of Florida and the
political subdivisions thereof; (iii) all taxes and fees (except for Bank's
state and federal income taxes) that may be levied by the United States of
America or any state or political subdivision thereof, upon Bank or Borrower in
connection with or upon the Loan Documents, or the Debt or its payment, or
collection, or any combination thereof (including all documentary stamp taxes
and intangible taxes plus any penalties and interest charged for the late
payment of any such taxes); and (iv) except as otherwise provided in the Loan
Agreement, all lawful claims and demands of contractors, subcontractors,
mechanics, laborers, materialmen and other lienors which, if unpaid, might
result in the creation of a lien upon the Collateral. The sums payable under
this paragraph are called "Impositions". Nothing contained in this paragraph
will require the payment of any Imposition so long as the amount, validity or
enforceability thereof is contested by appropriate proceedings as provided in
paragraph 8 below. With respect to state and local real and tangible personal
property taxes, however, Borrower will pay same and will furnish Bank with
copies of the receipts for each such payment without demand prior to April 30th
of each year of the Loan and any contest of the same must be by a suit or other
proceeding for a refund. With respect to all other Impositions, Borrower will
furnish Bank with proof of such payment upon demand. If any payment required to
be made by Borrower by this paragraph is prohibited by law, with the result that
Bank becomes liable for its payment, then the Debt will immediately become due
and payable, at Bank's option.
8. CONTESTS. Borrower may contest, by any and all appropriate
administrative, trial or appellate proceedings, or any combination thereof, and
in Bank's name, if required by law, the amount, validity, enforceability or
application of any Imposition that Borrower is required to pay or perform to any
person or entity other than Bank by any provision of this Mortgage or the other
Loan Documents if and only for so long as: (i) Borrower notifies Bank in writing
of its intent to contest the Imposition; (ii) such contest suspends the
collection or enforcement of the item(s) contested; (iii) no part of the
Collateral will be subject to loss, sale or forfeiture before final
determination of any such contest; (iv) neither Borrower nor Bank will be
subject to any criminal liability; (v) Borrower furnishes such security as may
be required by law in connection with each such contest; (vi) the value,
usefulness and marketability of the Collateral will not be adversely impaired by
any such contest; (vii) Borrower otherwise continues to pay and perform, as the
case may be, the Debt and Borrower's obligations under this Mortgage; (viii)
Borrower otherwise is not in Default under any provision of the Loan Documents;
(ix) each such contest is continuously prosecuted diligently to final
determination; (x) Borrower pays or causes to be paid, and defends, indemnities
and holds Bank harmless of and from any and all losses, judgments, decrees and
costs
7
(including all reasonable attorneys, fees) incurred in connection with each such
contest; (xi) Borrower, promptly following final determination of each such
contest, fully pays and discharges all amounts that may be levied, assessed,
charged, imposed or otherwise determined to be payable, together with all
penalties, fines, interests, costs and expenses, and otherwise complies with
such final determination, at Borrower's sole cost and expense; (xii) Borrower
furnishes Bank with such security as Bank reasonably may require to assure
Borrower's compliance with all of the foregoing requirements, and (xiii) such
liens are not filed against the Mortgaged Property pursuant to Chapter 713,
Florida Statutes, in which event such liens must be discharged or transferred to
bond pursuant to paragraph 6 above before Borrower contests such liens except as
otherwise provided in the Loan Agreement. So long as Borrower complies with the
foregoing and Bank is promptly reimbursed for all costs and expenses incurred,
Bank will cooperate with Borrower in connection with any such contest.
9. INSURANCE. Until the Debt shall have been discharged by Borrower,
Borrower shall maintain, at Borrower's cost and expense, the following insurance
coverages in full force and effect at all times:
a. HAZARD INSURANCE. Borrower shall keep the Tangible Property and
Improvements which now or hereafter may constitute part of the
Mortgaged Property insured at all times against loss or damage by fire
and other hazards included within the term "all risk" or "extended
coverage" and against such other hazards as Bank may require in the
full insurable value thereof (or such lesser amount as Bank may
authorize in writing) , with an insurer satisfactory to Bank. Such
policy shall include a Replacement Cost and Agreed Amount/Stipulated
Value Endorsement and a Sinkhole Endorsement, if deemed necessary by
Bank.
b. LIABILITY INSURANCE. Borrower will obtain and keep in full force
a "Broad Form Comprehensive General Liability" insurance coverage for
both Borrower and any contractor performing services to the Mortgaged
Property in the minimum coverage amount of TWO MILLION AND NO/100
DOLLARS ($2,000,000.00) per occurrence for bodily injury and One
Hundred Thousand Dollars ($100,000.00) per occurrence for property
damage.
x. XXXXX INSURANCE. If at any time the Land or any portion thereof
is located in a "Flood Hazard Area" pursuant to the Flood Disaster
Protection Act of 1973 or any successor or supplemental act thereto,
flood insurance in the maximum amount available or such other amount as
Bank may reasonably request;
d. BUILDER'S RISK INSURANCE. An "All risk", non-reporting, completed
value builder's risk insurance policy in an amount not less than loan
amount per Unit which policy shall include Agreed Amount, Replacement
Cost, Permit to occupy and Vandalism/Malicious Mischief Endorsements.
Notwithstanding the foregoing, Bank will not fund at any one time in
excess of the total loan amount without further insurance being issued
to cover the additional funded balances.
e. OTHER INSURANCE. Machinery insurance, worker's compensation
insurance, wind damage insurance, and other insurance coverages as Bank
may reasonably require.
The policy or policies of insurance shall (i) be from companies and in
coverage amounts acceptable to Bank, (ii) contain a standard mortgagee clause in
favor of Bank naming Bank as a mortgagee and including a lender's loss payee
clause in such policy, as applicable (iii) not be terminable or modified without
thirty (30) days, prior written notice to Bank, and (iv) be evidenced by
original policies or certified copies of policies deposited with Bank, as Bank
may elect, to be held by Bank until the Debt shall have been fully paid and
discharged. Borrower shall furnish Bank satisfactory evidence of payment of all
premiums required and similar evidence of renewal or replacement coverage not
later than thirty (30) days prior to the date any coverage will expire.
8
Each insurance policy or endorsement required herein shall be written
by an insurer having a rating not less than "A-XI" Best's Rating according to
the most current edition of Best's Key Rating Guide as determined at the time of
the initial policy and at all times during the term hereof. All policies shall
indicate that notices related to such insurance shall be sent to Bank at:
Chase Federal Bank, a Federal Savings Bank,
a Division of NationsBank, N.A. (South)
Suite 101 000 Xxxx Xxxxxxx Xxxxx Xxxx
Xx. Xxxxxxxxxx, XX 00000
Attn: Loan Administration Section,
Real Estate Banking Group
If any loss occurs with respect to the Mortgaged Property, Bank is
hereby appointed attorney-in-fact for Borrower to make proof of loss if Borrower
fails to make the same punctually, and to give a receipt for any proceeds
collected under such policies. Borrower will promptly give written notice to
Bank of any loss or damage to the Mortgaged Property, and will not adjust or
settle any such loss without Bank's prior written consent, which consent shall
not be unreasonably withheld or delayed. Upon any Default by Borrower under this
Mortgage, all right, title and interest of Borrower in and to all such insurance
policies then in force, including any and all unearned premiums and existing
claims, will inure to Bank, which, at its option, and as attorney-in-fact for
Borrower, may then make, settle and give binding acquittances for claims under
all such policies, and may assign and transfer such policies or cancel or
surrender them, applying any unearned premium in such manner as Bank may elect.
The foregoing appointment of Bank as attorney-in-fact for Borrower is coupled
with an interest, and is irrevocable. Notwithstanding the occurrence of any
casualty or the availability of any insurance proceeds, Borrower will pay the
Debt in the manner required by the Loan Documents.
10. CONDEMNATION. If all or any part of the Collateral, or any interest
therein or right accruing thereto, is taken as a result of, or in lieu or in
anticipation of, the exercise of the right of condemnation or eminent domain, or
by reason of the temporary requisition of the use or occupancy of the Mortgaged
Property, in any event by any government or quasi-governmental authority, civil
or military, or any other party entitled to exercise such powers by law, general
or special, or is devalued or otherwise adversely affected by any of the
foregoing actions, all proceeds payable with respect to any such action are
assigned to Bank and shall be paid to Bank. Bank shall be under no obligation to
question the amount of any such award or compensation and may accept the same in
the amount in which the same shall be paid. The proceeds of any award or
compensation so received shall, at the option of the Bank, either be applied to
the payment of the Debt or be paid over to the Borrower for the restoration of
the Improvement. Borrower, immediately upon obtaining knowledge of the
institution or threatened institution, of any proceedings for the Mortgaged
Property, or any part thereof, by condemnation or eminent domain, will notify
the Bank of the pending of such proceedings. Bank shall have the right to
intervene and participate in any proceedings for and in connection with any
taking referred to in this section. Borrower shall not enter into any agreement
for the taking of the Mortgaged Property or any part thereof with any person or
persons authorized to acquire the same by condemnation or eminent domain, unless
the Bank shall have consented thereto in writing. Any of the foregoing actions
are sometimes called a "condemnation" or "taking" in this Mortgage and the other
Loan Documents. Such proceeds include, without limitation, severance damages,
damages arising from the change of grade of any street or the access thereto,
the taking of air rights and damages caused by noise, pollutants and other
emissions. Notwithstanding any such taking or other injury or decrease in value,
or the availability of any proceeds for any of the foregoing, Borrower shall
continue to pay the Debt in the manner required by the Loan Documents. Bank's
rights under this paragraph will survive the foreclosure or other enforcement of
this Mortgage, and Bank will have the right to receive and retain all proceeds
to the extent of any deficiency which exists upon such foreclosure or other
enforcement, together with legal interest thereon, and to the extent of the
reasonable counsel fees, costs and disbursements incurred by Bank in connection
with the collection of such proceeds. Such right shall exist whether or not a
deficiency judgment shall have been sought or recovered or denied upon the Note.
The remaining balance of such proceeds, if any, will inure to the benefit of the
party entitled thereto by applicable law.
9
Notwithstanding the foregoing, if Bank uses the net proceeds of the condemnation
to reduce the principal balance owed under the Note, Bank will thenceforth allow
those funds to be disbursed to the Borrower in accordance with the Loan
Agreement.
11. APPLICATION OF INSURANCE PROCEEDS AND AWARDS. The Borrower will
promptly give the Bank written notice of any damage to or destruction of the
Mortgaged Property or any part thereof, generally describing the nature and
extent of such damage or destruction and the Borrower's best estimate of the
cost of restoring the Mortgaged Property. The Bank shall be entitled to all
insurance proceeds payable on account of such damage or destruction and the
Borrower hereby irrevocably assigns, transfers and sets over to the Bank all
rights of the Borrower to any such proceeds or payments and irrevocably
authorizes and empowers the Bank, at its option and in its sole and absolute
discretion, in the name of the Borrower or otherwise, to file and prosecute what
would otherwise be the Borrower's claim for any such proceeds or payment and to
collect, receipt for and retain the same for disposition in accordance with this
Section. The Bank may, at its sole option, apply all amounts recovered under any
insurance policy required to be maintained by the Borrower hereunder in any one
or more of the following ways: (a) to the payment of the reasonable costs and
expenses incurred by the Bank in obtaining such insurance proceeds, including
the fees and expenses of attorneys and insurance and other experts and
consultants, the costs of litigation, arbitration, mediation, investigations and
other judicial, administrative or other proceedings and all other out-of-pocket
expenses; (b) to the payment of any of the Debt other than indebtedness with
respect to the Note at the time outstanding; (c) to the payment of the principal
of the Note and any interest accrued and unpaid thereon, without regard to
whether any portion or all of such amounts shall be matured or unmatured,
together with interest at the default interest rate on any overdue principal and
(to the extent permitted by applicable law) interest; and, in case such amount
shall be insufficient to pay in full all such amounts, then such amounts shall
be applied, FIRST, to the payment of all amounts of interest accrued on the Note
and unpaid, without preference or priority of any payment of interest over any
other payment of interest or of any other Note, and, SECOND, to the payment of
all amounts of principal at the time outstanding, without preference or priority
of any installment or amount of principal over any other installment or amount
of principal or of any Note over any other Note, but otherwise in such manner
and order as the Bank shall in its sole discretion determine; (d) to fulfill any
of the other covenants contained herein as the Bank may determine; (e) release
to the Borrower for application to the cost of restoring the Mortgaged Property;
or (f) release to the Borrower. In the event of a foreclosure of this Mortgage,
the purchaser of the Mortgaged Property shall succeed to all the rights of the
Borrower including any right to unearned premiums, in and to all policies of
insurance assigned and delivered to the Bank. Notwithstanding the foregoing, if
Bank uses the net proceeds of the insurance proceeds or awards to reduce the
principal balance owed under the Note, Bank will thenceforth allow those funds
to be disbursed to the Borrower in accordance with the Loan Agreement.
Notwithstanding anything in this paragraph to the contrary, if the Bank has
elected to apply proceeds to the Debt, Bank will re-disburse said proceeds in
accordance with the Loan Agreement.
12. MAINTENANCE, REPAIRS, AND RECONSTRUCTION.
a. MAINTENANCE AND REPAIRS. Borrower, at its sole cost and subject
to Bank's satisfaction, shall make all repairs, renewals, replacements,
servicing and reconstruction that are necessary to maintain the
Mortgaged Property in good order, condition and repair. Immediately
following the occurrence of any casualty or other loss, Borrower
promptly will undertake all restoration required or desirable and will
pursue it diligently to completion. The foregoing shall be accomplished
by the Bank funding the insurance proceeds it receives from the insurer
to the Borrower under the terms and conditions of the Loan Agreement
for the construction of individual Units. Borrower shall (i) not strip,
waste, remove or demolish any portion of the Mortgaged Property, nor
suffer or permit any such action; (ii) promptly comply with all laws,
governmental regulations and public or private restrictions or
easements, or both, of any kind affecting the Mortgaged Property or
requiring any alterations or improvements to be made thereon, and (iii)
not commit, suffer or permit any act upon the Mortgaged Property in
violation of any law, subject to Borrower's right' to contest the same
in good faith to conclusion, as provided in paragraph 8 of this
Mortgage. If any public agency or authority requires or commences any
proceedings for the
10
demolition or removal, or both, of any improvements or portions thereof
comprising the Mortgaged Property due to non-compliance with health,
safety, fire or building codes, then, unless Borrower undertakes to
contest such action in the manner provided in paragraph 8 above and
pursues such contest to a successful conclusion, such action will
constitute a Default under this Mortgage. Borrower will not, without
Bank's prior written consent, (i) make any material alterations,
additions or improvements of or to the Mortgaged Property unless
required by the Loan Agreement; (ii) make any material change in the
general nature of the use or occupancy of the Mortgaged Property; (iii)
institute or join or acquiesce in any action to change the existing
zoning or land use classification of the Mortgaged Property, or (iv)
grant easements or licenses affecting the use or operation of the
Mortgaged Property. Bank and any persons authorized by Bank may enter
the Mortgaged Property at all reasonable times without prior notice for
inspections or for any other lawful purpose. If Borrower fails to
comply with the requirements of this paragraph, then Bank, without
waiving the option to foreclose, may take some or all measures Bank
reasonably deems necessary or desirable for the maintenance, repair,
preservation or protection of the Mortgaged Property, and any expenses
reasonably incurred by Bank in so doing shall become part of the Debt
secured hereby, and shall, at the option of Bank, become immediately
due and payable, and shall bear interest at the Default Rate specified
in the Note. Bank shall have no obligation to care for or maintain the
Mortgaged Property, or, having taken some measures therefor, to
continue same or take other measures.
b. RECONSTRUCTION. The Borrower after receipt of net insurance
proceeds from Bank funded in accordance with the Loan Agreement shall
promptly repair, restore, replace or rebuild any part of the Mortgaged
Property, now or hereafter encumbered by this Mortgage which may be
affected by any condemnation proceeding or which may otherwise become
damaged, destroyed, lost or unsuitable for use. In the event the
Mortgaged Property or any part thereof if damaged or destroyed by fire
or other casualty, the Borrower shall immediately notify the Bank, in
writing, of such damage or destruction. The Borrower shall not cause or
permit anything to be done which would or could increase the risk of
fire or other hazard to the Mortgaged Property, or any part thereof, or
which would or could result in an increase in any insurance premiums
payable with respect to the Mortgaged Property, or which would or could
result in the cancellation of any insurance policy carried with respect
to the Mortgaged Property. No part of the Mortgaged Property,
including, but not limited to, any building, structure, water system,
sewer system, parking lot, driveway, landscape scheme, timber or other
ground improvement, equipment or other property, now or hereafter
mortgaged, shall be removed, demolished or materially altered without
the prior written consent of the Bank. No top soil, sand, sod, loam,
clay or gravel shall be mined, stripped, or removed from the Mortgaged
Property without the written consent of the Bank. However, this shall
not prevent or restrict removal of any such materials taken for
excavation necessary to construct a basement, cellar or foundation
footings for the erection of a building or buildings for which a
building permit or permits has or have first been issued by the
governmental authority having jurisdiction thereof; or for the
construction of roadways or the Improvements constructed in accordance
with plans approved by the governmental authorities having jurisdiction
thereof in accordance with the Loan Agreement; provided, nevertheless,
that in the event the required removals become so extensive, as
determined by the Bank, as to create profit by sale of the removed
portion of the Mortgaged Property, said sums shall inure to the benefit
of the Bank to be applied as the Bank so directs, to the reduction of
the Debt.
13. ADVANCES. If Borrower Defaults in the observance or performance of
any of the provisions of the Loan Documents, including but not limited to
obtaining and maintaining insurance pursuant to paragraph 9, paying Impositions
pursuant to paragraph 7, and maintaining the Mortgaged Property pursuant to
paragraph 12, then Bank, without waiving or otherwise impairing any other of its
rights or remedies, at its sole option and without obligation to do so, and
without demand upon Borrower, may make any such payment or take such action as
Bank deems necessary or appropriate to correct such Default, or to protect the
security of the Collateral encumbered by the Loan Documents. All payments so
made, together with all costs and expenses so incurred, will be added to the
principal amount due under the Note and thereafter will bear interest at the
rate then payable as provided for in the
11
Note, and will be secured by the lien and security interest granted by the
Security Documents. For the foregoing purposes, Bank is authorized to (a) enter
upon the Mortgaged Property; (b) appear in and defend any action or proceeding
purporting to affect the security of this Mortgage or the rights or powers of
Bank hereunder; (c) pay, purchase, contest or compromise any encumbrance, charge
or lien that in the reasonable judgment of Bank appears to adversely affect the
Collateral; and (d) take whatever action Bank, in its discretion, deems
necessary or appropriate in exercising any such powers. Notwithstanding the
foregoing, Borrower immediately, upon Bank's demand, will pay all sums so
expended by Bank with interest as stated above.
14. BOOKS AND RECORDS. Borrower, at all times, will keep proper books
of record and account in which full, true and correct entries will be made of
its transactions with respect to the Collateral in accordance with generally
accepted accounting principles, consistently applied, and which will properly
and correctly reflect all items of income and expense in connection with the
operation of the Collateral, regardless of whether such income or expense is
realized by Borrower or any other person or entity whatsoever. Bank will have
the right from time to time during normal business hours to examine all such
books, records and accounts at Borrower's office or at the office of such other
person as maintains them, and to make such copies or extracts as Bank may
desire, at Borrower's expense.
15. TAXATION OF MORTGAGE. In the event of the passage after the date of
this Mortgage of any federal, state or local law deducting from the value of
real property for the purpose of ad valorem taxation any lien thereon or
changing in any way the laws for the taxation of mortgages or debts secured by
mortgages for federal, state or local purposes, or the manner of the collection
of any such taxes, and imposing a tax, either directly or indirectly, on any or
all of the Loan Documents, Bank shall have the right to declare the Debt due on
a date to be specified by not less than sixty (60) days' written notice given to
Borrower by Bank; provided, however, that such election shall be ineffective if
Borrower is permitted by law to pay the whole of such tax in addition to all
other payments required hereunder, and if Borrower, prior to such specified
date, does pay such tax and agrees to pay any such tax (excluding, however, all
taxes on the income of Bank) when thereafter levied or assessed, and such
agreement shall constitute a modification of this Mortgage. Notwithstanding any
provision in this paragraph to the contrary, Borrower may contest the matters
described herein per the procedures set forth in paragraph 8 above.
16. ASSIGNMENT OF RENTS, LEASES, PROFITS AND CONTRACT RIGHTS. Pursuant
to paragraph 1 of this Mortgage, Borrower has irrevocably assigned and set over
unto Bank all right, title, and interest of Borrower in and to the Rents and
Contract Rights (including all leases and sales contracts now or hereafter
existing relating to the Mortgaged Property) as security for the Debt, together
with the right to collect and enforce the same; provided, however, so long as
there shall be no Default under the Loan Documents, Borrower has been granted a
license to collect and receive all Rents assigned hereunder in accordance with
paragraph 1. Neither these assignments nor Bank's enforcement of the provisions
of these assignments (including the receipt of the Rents) will operate to
subordinate the lien of this Mortgage to any of the rights of any lessee or
purchaser under any lease or sales contract of the Mortgaged Property, or to
subject Bank to any liability to any such lessee or purchaser for the
performance of any obligations of Borrower under any such lease or sales
contract unless and until Bank agrees to such subordination or assumes such
liability by an appropriate written instrument. All right, title and interest of
each such lessee or purchaser in and to the Mortgaged Property, whether arising
by virtue of any such lease, contract or otherwise, at all times will be and
remain subject, subordinate and inferior to the lien of this Mortgage and all
rights, remedies, powers and privileges of Bank arising under or by virtue of
any of the Loan Documents. The assignments of Rents and Contract Rights
(including leases) contained in this Mortgage are intended to provide Bank with
all the rights and remedies of mortgagees pursuant to Section 697.07, Florida
Statutes, as may be amended from time to time. However, in no event shall this
reference diminish, alter, impair, or affect any other rights and remedies of
Bank. Notwithstanding the foregoing, if Borrower shall have executed an
Assignment of Rents constituting one of the Loan Documents, such Assignment of
Rents is hereby incorporated herein by reference and shall control if in
conflict with the provisions of this Mortgage.
12
17. LEASES AFFECTING MORTGAGED PROPERTY. The assignments
contained in paragraph 1 shall not be deemed to impose upon Bank any of the
obligations or duties of Borrower provided in any lease affecting the Mortgaged
Property (including, without limitation, any liability under the covenant of
quiet enjoyment contained in any lease in the event that any tenant shall have
been joined as a party defendant in any action to foreclose this Mortgage and
shall have been barred and foreclosed thereby of all right, title and interest
and equity of redemption in the Mortgaged Property or any part thereof), and
Borrower will comply with and observe its obligations as landlord under all
leases affecting the Mortgaged Property or any part thereof. Borrower has a
license to collect the Rents, but shall not accept payment of rent more than one
month in advance without the prior written consent of the Bank, and only so long
as there is no Default hereunder or under the other Loan Documents. Borrower
shall receive the Rents in trust on Bank's behalf, and Borrower covenants to
apply same to the payment of taxes and assessments upon the Mortgaged Property,
to the cost of insurance and maintenance and repairs, and to the payment of the
Debt, before using any part of the Rents for any other purpose.
Prior to a Default hereunder and demand by Bank for delivery of
security deposits held by Borrower or any agent of Borrower to Bank or its
designee, Borrower shall maintain all security deposits pursuant to the leases
in a separate, identifiable account deposited with Bank, or any other
institution acceptable to Bank, and in accordance with all applicable laws and
regulations. Upon delivery of such security deposits to Bank, or upon Bank's
enforcement of its security interest in such deposits, Bank shall hold such
security deposits pursuant to the terms of the leases in respect of which such
deposits were obtained by Borrower and in accordance with applicable law;
provided, however, in no event shall Bank be liable to any lessee of any part of
the Mortgaged Property for the return of any security deposit in any amount in
excess of the amount delivered to Bank by Borrower. Any security deposits held
by Bank shall not bear interest unless required by applicable law.
Borrower will: (a) not collect any of the Rents arising or accruing
under any lease in advance of the time when the same shall become due, other
than as required to be paid in advance by the terms of any lease, but in no
event more than one (1) month in advance; (b) not pledge, transfer, mortgage or
otherwise encumber or assign any of Borrower's interest in the leases or any
Rents arising or accruing therefrom; (c) not waive, excuse, condone, discount,
set-off, compromise, or in any manner release or discharge any tenant thereunder
of and from any obligations, covenants, conditions and agreements by said tenant
to be kept, observed and performed, including the obligation to pay the rents
thereunder, in the manner at the place and time specified therein; (d) not
cancel, terminate or consent to any surrender of any lease, nor modify, alter or
change any of the terms thereof without the prior written consent of Bank; (e)
not consent to any assignment of or subletting under any lease, whether or not
in accordance with the terms thereof, without the prior written consent of Bank;
and (f) not enter into, execute or deliver any leases without the prior written
consent of Bank.
In the event any tenant of the Mortgaged Property should be the subject
of any proceeding under the Federal Bankruptcy Code, as amended from time to
time, or any other federal, state or local statue which provided for the
possible termination or rejection of any of the leases assigned hereby, Borrower
covenants and agrees that if any of the leases is so terminated or rejected, no
settlement for damages shall be made without the prior written consent of Bank,
and any check in payment of damages for termination or rejection of any such
lease will be made payable both to Borrower and Bank. Borrower hereby assigns
any such payment to Bank and further covenants and agrees that upon the request
of Bank, it will duly endorse to the order of Bank any such check, the proceeds
of which will be applied to that portion of the Debt as Bank may elect.
From time to time, Borrower agrees to obtain tenant estoppel
certificates from each tenant of the Mortgaged Property containing such
information as may be reasonably requested by Bank.
18. DEFAULT. The occurrence of any of the following (time being of the
essence as to this Mortgage and all of its provisions) constitutes a "Default"
by Borrower under this Mortgage, and, at the option of Bank, under the other
Loan Documents:
13
a. SCHEDULED PAYMENT. Borrower's failure to make any payment
required under the Note when due or within any applicable grace period.
b. MONETARY DEFAULT. Borrower's failure to make any other payment
required by this Loan Agreement or the other Loan Documents when due.
c. OTHER. Borrower's failure to perform any other obligation imposed
upon Borrower by this Loan Agreement or any other Loan Document within
thirty (30) days after the date when performance is due. This provision
shall not be construed to provide Borrower with any grace period in
complying with any obligations imposed on Borrower by the terms of the
Loan Documents. Notwithstanding the foregoing provision, Bank shall
give Borrower notice, as defined in the Mortgage, of any non-monetary
default after which Borrower shall have a thirty (30) day cure period,
unless such non-monetary default is not capable of being cured within
said thirty (30) day period, in which case Borrower shall have sixty
(60) days to cure such default following the date performance is due
provided Borrower has commenced and is diligently pursuing the cure for
such default (which determination shall be made in Bank's sole and
absolute discretion), and provided such additional time to cure such
default does not negatively affect the value of the collateral or the
preservation of the collateral's value, which determination shall be
made in Bank's sole and absolute discretion.
d. REPRESENTATION. Any representation or warranty of Borrower
contained in this Loan Agreement or in any certificate delivered
pursuant hereto, or in any other instrument or statement
furnished in connection herewith, proves to be incorrect or misleading
in any adverse respect as of the time when the same shall have been
made, including, without limitation, any and all financial statements,
operating statements, and schedules attached thereto, furnished by
Borrower or any guarantor of the Loan to Bank or pursuant to any
provision of this Loan Agreement.
e. BANKRUPTCY. Borrower or any general partner of Borrower or any
guarantor of the Loan (i) files a voluntary petition in bankruptcy or a
petition or answer seeking or acquiescing in any reorganization or for
an arrangement, composition, readjustment, liquidation, dissolution, or
similar relief for itself pursuant to the United State Bankruptcy Code
or any similar law or regulation, federal or state, relating to any
relief for debtors, now or hereafter in effect; or (ii) makes an
assignment for the benefit of creditors or admits in writing its
inability to pay or fails to pay its debts as they become due; or (iii)
suspends payment of its obligations or takes any action in furtherance
of the foregoing; or (iv) consents to or acquiesces in the appointment
of a receiver, trustee, custodian, conservator, liquidator or other
similar official of Borrower, a general partner of Borrower, or any
guarantor, for all or any part of the Collateral or other assets of
such party, or either; or (v) has filed against it an involuntary
petition, arrangement, composition, readjustment, liquidation,
dissolution, or an answer proposing an adjudication of it as a bankrupt
or insolvent, or is subject to reorganization pursuant to the
United-States Bankruptcy Code, an action seeking to appoint a trustee,
receiver, custodian, or conservator or liquidator, or any similar law,
federal or state, now or hereinafter in effect, and such action is
approved by any court of competent jurisdiction and the order approving
the same shall not be vacated or stayed within sixty (60) days from
entry; or (vi) consents to the filing of any such petition or answer,
or shall fail to deny the material allegations of the same in a timely
manner.
f. JUDGMENTS. (1) A final judgment other than a final judgment in
connection with any condemnation is entered against Borrower,
Guarantors, or any general partner of Borrower, that (i) adversely
affects the value, use or operation of the Land or the improvements in
Bank's sole judgment, or (ii) adversely affects, or may adversely
affect, the validity, enforceability or priority of the lien or
security interest created by the Mortgage or any other Loan Document in
Bank's sole judgment, or both; or (2) execution or other final process
issues thereon with respect to the Land or the Improvements; and (3)
Borrower, Guarantor, or any general partner of Borrower, does not
discharge the same or provide for
14
its discharge in accordance with its terms, or procure a stay of
execution thereon, in any event within thirty (30) days from entry, or
Borrower shall not, within such period or such longer period during
which execution on such judgment shall have been entered, and cause its
execution to be stayed during such appeal, or if on appeal such order,
decree or process shall be affirmed and Borrower shall not discharge
such judgment or provide for its discharge in accordance with its terms
within sixty (60) days after the entry of such order or decree or
affirmance, or if any stay of execution on appeal is released or
otherwise discharged.
g. LIENS. Any federal, state or local tax lien or any claim of lien
for labor or materials or any other lien or encumbrance of any nature
whatsoever is recorded against Borrower or the Land or Improvements and
is not removed by payment or transferred to substitute security in the
manner provided by law, within thirty (30) days after it is recorded in
accordance with applicable law.
h. OTHER NOTES OR MORTGAGES. Borrower's default in the performance
or payment of Borrower's obligations under any other note which remains
uncured after any applicable grace period, or under that certain Real
Estate Mortgage, Assignment and Security Agreement of even date
herewith in favor of Bank, securing a note in the original principal
amount of THREE MILLION AND NO/100 DOLLARS ($3,000,000.00) and
encumbering that portion of the Land commonly referred to as Parcel "F"
and that certain Real Estate Mortgage, Assignment and Security
Agreement of even date herewith in favor of Bank, securing a note in
the original principal amount of THREE MILLION FOUR HUNDRED THOUSAND
AND NO/100 DOLLARS ($3,400,000.00), and encumbering that portion of the
Land commonly referred to as Parcel "D", or under any other mortgage
encumbering all or any part of the Land or the Improvements, if the
other mortgage is permitted by the Bank, whether such other note or
mortgage is held by Bank or by any other party, and unless otherwise
agreed to by separate written agreement between Bank and such other
mortgage holder.
i. BORROWER DEFAULT UNDER LOAN DOCUMENTS. Borrower's default in the
payment or performance following expiration of any applicable grace
period of any of Borrower obligations under any of the Loan Documents,
including this Mortgage and any riders thereto.
j. GUARANTOR DEFAULT.
i) The default after expiration of any applicable grace period in
the payment or performance of any obligation of a Guarantor of the
Note arising under its guaranty or pursuant to any other Loan
Documents; or
ii) The death of any Guarantor and the failure of Borrower to
provide Bank with an alternate guaranty or alternate collateral
satisfactory to Bank in its sole and absolute discretion within
sixty (60) days of the date of Guarantor's death.
k. BORROWERS/GENERAL PARTNER'S CONTINUED EXISTENCE. Borrower or any
corporate General Partner of Borrower shall cease to exist or to be
qualified to do or transact business in the State in which the Land and
Improvements are located, or shall be dissolved or shall be a party to
a merger or consolidation, or shall sell all or substantially all of
its assets, or shall change its corporate name or trade name without
prior written notice to Bank.
l. STOCK IN BORROWER/CHANGE IN PARTNERS. If Borrower is a limited
partnership and without the prior written consent of Bank, any shares
of stock of any corporate general partner of Borrower are issued, sold,
transferred, conveyed, assigned, mortgaged, pledged, or otherwise
disposed of so as to result in change of control of Borrower, whether
voluntarily or by operation of law, and whether with or without
consideration, or any agreement for any of the foregoing is entered
into; or, if any general
15
partnership interest or other equity interest in the Borrower is sold,
transferred, assigned, conveyed, mortgaged, pledged, or otherwise
disposed of, whether voluntarily or by operation of law, and whether
with or without consideration, or any agreement for any of the
foregoing is entered into, or any general partner of Borrower withdraws
from the partnership.
m. TRANSFER OF PROPERTY OR OWNERSHIP. Any sale, conveyance,
transfer, assignment, or other disposition or encumbrance of all or any
part of the Land, Improvements, or the Approved Project, or any
ownership interest in Borrower or any guarantor without the prior
consent of Bank or except as otherwise permitted hereby, or as outlined
in the prospectus for public offering for Transeastern Properties,
Inc., a Florida corporation delivered to Bank by Borrower.
n. FALSE STATEMENT. Any statement or representation of Borrower or
any guarantor contained in the loan application or any financial
statements or other materials furnished to Bank or any other Bank prior
or subsequent to the making of the Loan secured hereby are discovered
to have been false or incorrect or incomplete.
o. DEFAULT UNDER INDEMNITY. Borrower or Guarantor shall default
after any applicable grace period under any obligation imposed by any
indemnity contained within any of the Loan Documents including the
Hazardous Waste Certification and Indemnification.
p. OTHER DEFAULTS. Borrower or Guarantor shall Default under any
other Default provision set forth in the Loan Agreement, which is not
cured within any applicable grace period.
19. REMEDIES. Upon the occurrence and continuance, if applicable, of
any Default, Bank may exercise any one or more of the following rights and
remedies, in addition to all other rights and remedies otherwise available at
law or in equity:
a. OTHER DOCUMENTS. To pursue any right or remedy provided by the
Loan Documents.
b. ACCELERATION. To declare the entire unpaid amount of the Debt
together with all accrued and unpaid interest thereon immediately due
and payable with interest to be due thereon at the Default Rate set
forth in the Note.
c. FORECLOSURE. To foreclose the lien of this Mortgage and obtain
possession of the Collateral, by any lawful procedure.
d. CODE RIGHTS. To exercise any right or remedy available to Bank as
a secured party under the Uniform Commercial Code as adopted by the
State of Florida, as it from time to time is in force and effect, with
respect to any portion of the Collateral then constituting property
subject to the provisions of such Code; or Bank, at its option, may
elect to treat the Collateral as real property, or an interest therein,
for remedial purposes.
e. RECEIVER. To apply, on EX PARTE motion, to any court of competent
jurisdiction for the appointment of a receiver to take charge of,
manage, preserve, protect, complete construction of, rent, and operate
the Mortgaged Property and any of Borrower's business or businesses
situated thereon, or any combination thereof; to collect the Rents; to
make all necessary and needed repairs; to pay all taxes, assessments,
insurance premiums and all other costs incurred in connection with the
Mortgaged Property; and, after payment of the expenses of the
receivership, including reasonable attorneys, fees and other costs and
expenses related to the enforcement of the Security Documents, and
after compensation to the receiver for any of the services described
herein or pursuant hereto, to apply all net proceeds derived therefrom
in reduction of the Debt or in such other manner as the court shall
direct. The appointment of such receiver
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shall be a matter of strict right to Bank, regardless of the adequacy
of the security or of the solvency of any party obligated for payment
of the Debt. All expenses, fees and compensation incurred pursuant to
any such receivership shall be secured by the lien of this Mortgage
until paid. The receiver, personally or through agents, may exclude
Borrower wholly from the Mortgaged Property and have, hold, use,
operate, manage and control the Mortgaged Property and may, in the name
of Borrower, exercise all of Borrower's rights and powers to maintain,
construct, operate, restore, insure and keep insured the Mortgaged
Property in such manner as such receiver deems appropriate.
f. SET-OFFS. Intentionally deleted.
g. RENTS. After Bank shall have given written notice to Borrower, to
collect all rents, issues, profits, revenues, income, proceeds, or
other benefits from the Collateral, or to pursue any remedy available
under Chapter 697.07, Florida Statutes, as amended, supplemented, or
superseded from time to time.
h. OTHER SECURITY. To proceed to realize upon any and all other
security for the Debt in such order as Bank may elect; no such action,
suit, proceeding, judgment, levy, execution or other process will
constitute an election of remedies by Bank or will in any manner alter,
diminish or impair the lien and security interest created by this
Mortgage or any other Security Documents unless and until the Debt is
paid in full.
i. ADVANCES. To advance such monies and take such other action as is
authorized by paragraphs 13 and 25 herein.
20. WAIVER OF CERTAIN RIGHTS. Borrower will not claim, take or insist
upon any benefit or advantage of any present or future stay, extension,
redemption or moratorium law that may affect Borrower's obligations hereunder,
or any law providing for the valuation or appraisal of the Mortgaged Property or
any portion thereof prior to any sale or sales that may be made under or by
virtue of this Mortgage. Borrower, for itself and all who may claim under
Borrower, waives, to the extent that it lawfully may, all rights to have the
Mortgaged Property and any other security for the Debt marshaled upon any
foreclosure or otherwise. Borrower hereby waives and renounces all homestead and
exemption rights provided for by the laws of the United States of America and of
any state, including Florida, in and to the Mortgaged Property as against the
collection of the Debt, or any part thereof.
21. FURTHER ASSURANCES. Borrower, from time to time, will execute,
acknowledge, subscribe and deliver to or at the direction of Bank such documents
and further assurances as Bank may reasonably require for the purpose of
evidencing, perfecting or confirming the lien and security interest created by
this Mortgage, or the security intended to be afforded by the Loan Documents, or
both. Without limitation of the foregoing, Borrower will defend, indemnify and
hold Bank harmless with respect to any suit or proceeding in which the validity,
enforceability or priority of the lien or security interest, or both, is
endangered or contested, directly or indirectly, and will provide Bank with such
security for the defense of any such suit or proceeding as Bank reasonably may
require. If Borrower fails to undertake the defense of any such claim in a
timely manner, or fails to furnish Bank with reasonable security for such
defense after notice from Bank, or, in Bank's sole but reasonable determination,
fails to prosecute such defense with due diligence, then Bank is authorized to
take, at the expense of Borrower, all necessary and proper action in defense of
any such claim, including the retention of legal counsel, the prosecution or
defense of litigation and the compromise or discharge of claims, including
payment of all costs and reasonable attorneys' fees. All costs, expenses and
losses, if any, so incurred by Bank, including reasonable attorneys' fees,
regardless of whether suit is brought and, if suit is brought, for all
administrative, trial and appellate proceedings, if any, will constitute
advances by Bank as provided in paragraph 13.
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22. CUMULATIVE RIGHTS AND NON-WAIVER. No right or remedy conferred upon
or reserved to Bank by this Mortgage or in any of the other Loan Documents is
intended to be exclusive of any other right or remedy; and each and every right
and remedy is cumulative and in addition to any other right or remedy otherwise
available. Every right, power, privilege and remedy granted Bank by this
Mortgage or any of the other Loan Documents, or both, or otherwise available at
law or in equity may be exercised by Bank from time to time as often as Bank
deems expedient until the Debt is paid in full. Bank's failure to insist at any
time upon the strict observance or performance by Borrower of any of the
provisions of this Mortgage or in any of the other Loan Documents, or to
exercise any right or remedy provided for in this Mortgage or in any of the
other Loan Documents, will not impair any such right or remedy or be construed
as a waiver or relinquishment thereof for the future. Receipt by Bank of any
payment required to be made pursuant to any of the Loan Documents with knowledge
of the breach of any provision of any of the Loan Documents will not constitute
a waiver of such breach. In addition to all other remedies provided in this
Mortgage, Bank will be entitled, to the extent permitted by applicable law, to
injunctive relief in the case of a violation or attempted or threatened
violation of any of the provisions of the Loan Documents or to a decree ordering
performance of any of the provisions of any of the foregoing.
23. JUDGMENT. Bank may seek and recover a judgment for all amounts due
and payable in accordance with the Note or under this Mortgage either before,
after or during the pendency of any other proceedings or action to obtain relief
under or with respect to any of the Loan Documents. Bank's right to seek and
recover any such judgment will not be affected by obtaining any other such
relief. Bank will continue to be entitled to enforce payment of, and to seek and
recover a judgment for, any portion of the Debt remaining due and payable after
the application of any proceeds of any sale of the Collateral pursuant to law.
Neither the lien nor security interest of this Mortgage, nor any rights or
remedies of Bank hereunder or under any of the Loan Documents, will be impaired
in any way by the recovery, of any judgment by Bank against Borrower or any
guarantor of the Debt, or by the levy of an execution under such judgment upon
any portion of the Collateral, until the Debt is paid in full.
24. INDEMNIFICATION. Borrower has read and does hereby approve the
legal description of the Land which is the subject of this Mortgage as set forth
on the first page of this Mortgage or in Exhibit "A" attached hereto, and hereby
indemnifies Bank, its successors or assigns, and their attorneys with respect to
any liability which might arise as a consequence of Section 697.10, Florida
Statutes, or any successors or amendments thereto.
25. RELEASES AND EXTENSIONS BY BANK. Bank, from time to time,
without notice to any person and without affecting the liability of Borrower or
of any guarantor or of any other person (other than any person expressly
released by Bank in writing) for the payment of any of the Debt, and without
affecting the priority or extent of the lien and security interest of this
Mortgage (except as to property specifically released by Bank in writing), may
do any or all of the following: (i) release in whole or in part any person
liable for payment of any or all of the Debt, or (ii) extend the time or
otherwise alter the terms of payment of the Debt, in whole or in part, or (iii)
accept additional or substitute security of any kind, or (iv) release or
otherwise deal with all or any portion of the Collateral.
26. NOTICES. Any notice or demand that must or may be given or made in
connection with this Mortgage must be in writing and, unless receipt is
expressly required, will be deemed given, delivered or made, as the case may be,
when delivered by personal delivery or the day after it is mailed by Express
Mail, by overnight delivery service of a nationally-recognized company, and
addressed to the parties at the addresses written on the first page of this
Mortgage or on the signature pages of this Mortgage. Such addresses may be
changed by notice pursuant to this paragraph. Notice of change of address is
effective only upon receipt. All of the persons executing this Mortgage as
Borrower severally agree that a single notice to Borrower in the manner provided
in this paragraph will be effective to bind each such person for all purposes.
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27. ESTOPPEL LETTERS. As and when, from time to time, requested by
either Borrower or Bank, and within ten (10) days after any such request,
Borrower or Bank, as the case may be, will execute and deliver to or at the
direction of Bank or Borrower, as the case may be, such estoppel letters
certifying such matters relating to this Mortgage or the Loan Documents, or
both, as may reasonably be required.
28. TRANSFER. Borrower may not sell, convey, assign, transfer or
otherwise dispose of any interest in all or any portion of the Collateral, or
any ownership interest in Borrower or any guarantor, without Bank's prior
written consent, which consent may be withheld in Bank's sole discretion, or as
outlined in the prospectus for public offering for Transeastern Properties,
Inc., a Florida corporation delivered to Bank by Borrower. Whether such transfer
is voluntary or involuntary, or by operation of law, any such transfer will be
void as to Bank, and constitute an immediate Default under this Mortgage,
without notice, in the sole discretion of Bank. Bank's consent to any transfer,
sale, or conveyance hereunder shall not be deemed a consent to any subsequent
transfer, sale, or conveyance for which Bank's prior written approval has not
been obtained except as provided in the Loan Agreement.
29. REPLACEMENT OF NOTE. Upon receipt of evidence reasonably
satisfactory to Borrower of the loss, theft, destruction or mutilation of the
Note, or any amendment or modification thereto, including without limitation any
renewal note or additional note, and in the case of any such loss, theft, or
destruction, upon delivery of an indemnity agreement, reasonably satisfactory to
Borrower or, in the case of any such mutilation, upon surrender of such
mutilated note, Borrower will execute and deliver, in lieu thereof, a
replacement Note, identical in form and substance to the Note and dated as of
the date of the Note and upon such execution and delivery all references in any
of the Loan Documents to the Note shall be deemed to refer to the replacement
Note.
30. FUTURE ADVANCES. This mortgage is given to secure not only the
existing Debt, but also such future advances, whether such advances are
obligatory or are to be made at the option of Bank, or otherwise, as are made
within twenty (20) years from the date hereof, to the same extent as if such
future advances were made on the date of the execution of this Mortgage. The
total amount of Debt that may be so secured may decrease or increase from time
to time, but the maximum possible principal debt so secured at one time shall
not exceed the amount shown on Page of this Mortgage, plus interest thereon, and
any disbursements made for the payment of taxes, levies or insurance on the
Mortgaged Property, with interest on such disbursements at the rate then in
effect pursuant to the terms of the Note.
31. GENERAL. The provisions of this Mortgage inure to the benefit of
Bank and its successors and assigns, and bind all persons executing this
Mortgage as Borrower and their respective legal representatives, successors and
assigns, jointly and severally, and all persons now or hereafter claiming any
right, title and interest in and to any of the property, real, personal or
mixed, tangible or intangible, now or hereafter existing or any substitutions or
replacements thereof and described in this Mortgage as the Collateral. Time is
of the essence to this Mortgage and each of its provisions. The provisions of
this Mortgage are to be interpreted, construed, applied and enforced in
accordance with the laws of the State of Florida, regardless of where this
Mortgage is executed, delivered or breached, or where any payment or other
performance required by this Mortgage is made, where any action or other
proceeding involving this Mortgage is instituted, or whether the laws of the
State of Florida otherwise would apply the laws of another jurisdiction; the
foregoing choice of law provisions will apply to the Loan Documents. The
provisions of the Loan Documents are severable at Bank's option so that if any
provision is declared by a court of competent jurisdiction to be invalid or
unenforceable, no other provision will be affected by such invalidity or
unenforceability, but will remain in force and effect according to its original
terms, if Bank so elects. Wherever used in this Mortgage or the other Loan
Documents, or both, and unless expressly provided otherwise: (i) use of the
singular includes the plural, and vice versa; (ii) use of one gender includes
all genders; (iii) use of the term "include" or "including" is always without
limitation; (iv) use of the words, "should," "must" and "will" has the same
legal effect as the use of the word "shall"; (v) the term "day" means a banking
day which shall be a day on which Bank and other banks are open for the
transaction of business, excluding any national holidays, and any performance
which would otherwise be required on a day other than a banking day shall be
timely
19
performed in such instance, if performed on the next succeeding banking day;
(vi) any definition herein incorporating one or more documents or items shall
refer to such items "singularly and collectively", and (vii) "person" means any
natural person or artificial entity having legal capacity. Paragraph headings
and subheadings are for indexing purposes only and are not to be used to
interpret, construe, apply or enforce the provisions of this Mortgage. Borrower
and Bank intend the provisions of this Mortgage and the other Loan Documents to
be interpreted, construed, applied and enforced so as to avoid inconsistencies
or conflicting results; but if any such inconsistency or conflict necessarily
occurs, Borrower and Bank intend that the provisions of the Loan Agreement
control unless otherwise provided therein. This Mortgage may be amended only by
a written instrument executed by Borrower and Bank with the same formalities as
this Mortgage.
32. SATISFACTION. The lien and security interest provided by the Loan
Documents will continue unimpaired and in full force and effect unless and until
the Debt is paid in full, whereupon such lien and security interest will be
without further force or effect. Until this Mortgage shall be satisfied of
record, Borrower hereby waives for itself, and all subsequent successors in
title to the mortgaged Property, any right it may now have or hereafter have,
pursuant to Florida Statutes 697.04 (1).(b), as amended from time to time, to
file for record a notice limiting the maximum amount which may be secured by
this Mortgage.
33. DEPOSITS. Bank may, at its sole option upon occurrence of a
Default, require Borrower to make monthly deposits with Bank of a sum equivalent
to one-twelfth (1/12) of the annual real and tangible personal property taxes
assessed with respect to the Mortgaged Property and one-twelfth (1/12) of the
annual premiums for all insurance required to be maintained by this Mortgage. In
addition, upon occurrence of a Default, if required by Bank, Borrower shall also
deposit with Bank a sum of money which, together with the aforesaid monthly
deposits, will be sufficient to make each of such payments for taxes and
insurance at least ten (10) days prior to the date such payments are due. The
amount of such taxes, assessments, and premiums, when unknown, will be estimated
by Bank in good faith. Such deposits may be commingled with Bank's general
funds; Bank will not be liable for any interest on account of such deposits. To
the extent sufficient, such deposits will be applied by Bank to the payment of
such taxes, assessments, and premiums, when due, upon Borrower's presentation of
bills therefor; but Bank will have no obligation to make any such payment except
to the extent of such deposits. Any insufficiency of such deposits will be paid
by Borrower to Bank on demand. Upon any Default by Borrower under this Mortgage,
Bank may apply all such deposits to the Debt in such order as Bank may elect.
The enforceability of Borrower's covenants relating to taxes, assessments, and
insurance provided in this Mortgage will not be altered, diminished, impaired,
or otherwise affected by the provisions of this paragraph except insofar as such
obligations are actually met by Borrower's compliance with this paragraph. Bank
from time to time, at its sole option, may waive and, after any such waiver,
reinstate any or all of the provisions of this paragraph. While any such waiver
is in effect, Borrower will pay all taxes, assessments, and insurance premiums
as provided elsewhere in this Mortgage.
34. BORROWER AS TENANT HOLDING OVER. In the event of a foreclosure sale
of the Mortgaged Property, Borrower shall be deemed a tenant holding over and
shall forthwith deliver possession to Bank or any purchaser or purchasers at
such sale or be summarily dispossessed according to provisions of the law of the
State of Florida applicable to tenants holding over.
35. TIME OF THE ESSENCE. Time is of the essence with respect to each
and every covenant, agreement, and obligation of Borrower under this Mortgage
and the other Loan Documents, and any and all other instruments now or hereafter
evidencing, securing or otherwise relating to the Loan.
36. ORAL MODIFICATION INEFFECTIVE. No term of this Mortgage or any
other of the Loan Documents, or such documents, may be waived, changed,
modified, discharged, or terminated except by an instrument in writing signed by
the party against which enforcement of the waiver, change, modification,
discharge, or termination is sought.
20
37. HAZARDOUS SUBSTANCES. Borrower hereby represents and warrants to
Bank: (a) that neither Borrower nor any of its subsidiaries is in violation of
any judgment, decree, order, law, license, rule, or regulation pertaining to
environmental matters, including, without limitation, those arising under the
Resource Conservation and Recovery Act ("RCRA") , the Comprehensive
Environmental Response, Compensation, and Liability Act of 1980 as amended
("CERCLA") , the Superfund Amendments and Reauthorization Act of 1986 ("XXXX"),
the Federal Water Pollution Control Act, the Toxic Substances Control Act, or
any state or local statute, regulation, ordinance, order, or decree relating to
health, safety, or the environment (hereinafter "Environmental Laws); (b) that
neither Borrower nor any of its subsidiaries has received notice that it or any
of its tenants has been identified by the United States Environmental Protection
Agency as a potentially responsible party under CERCLA with respect to a site
listed on the National Priorities List, 40 C.F.R. Part 000 Xxxxxxxx X (1986);
nor has Borrower or any of its subsidiaries received any notification that any
hazardous waste, as defined by 42 U.S.C. ss.6093(5), any hazardous substances as
defined by 42 U.S.C. ss.9601(14), any "pollutant or contaminant" as defined by
42 U.S.C. ss.9601(33) and any toxic substance, hazardous materials, oil or other
chemicals or substances regulated by any Environmental Laws ("Hazardous
Substances") which it has disposed of has been found at any site on which a
federal or state agency is conducting a remedial investigation or other action
pursuant to any Environmental Law; (c) (i) to the best of Borrower's knowledge
except as disclosed in the Phase I and II Environmental Report prepared for Bank
and Borrower by Law Engineering and Environmental Services, Inc., a Florida
corporation dated November 7, 1995, no portion of the Mortgaged Property has
been used for the handling, processing, storage, or disposal of Hazardous
Substances and no underground tank or other underground storage receptacle for
Hazardous Substances is located on the Mortgaged Property, (ii) in the course of
its activities, neither Borrower nor any of its subsidiaries has generated or is
generating any hazardous waste on the Mortgaged Property, (iii) to the best of
our knowledge there have been no releases (i.e., any past or present releasing,
spilling, leaking, pumping, pouring, emitting, emptying, discharging, injecting,
escaping, leaching, disposing, or dumping) of Hazardous Substances by Borrower
or any of its subsidiaries on, upon, or into the Mortgaged Property, which
releases would have a material adverse effect on the value of the Mortgaged
Property. In addition, to the best of Borrower's knowledge, there have been no
such releases on, upon, or into any real property in the vicinity of the
Mortgaged Property which, through soil or groundwater contamination, may have
come to be located on the Mortgaged Property; (d) to the best of Borrower's
knowledge, that no asbestos, oil, petroleum or chemical liquids or solids,
liquid or gaseous products, or hazardous or toxic substances, within the meaning
of any applicable statute or regulation, are presently stored or otherwise
located on or under the Mortgaged Property or on or under any adjacent and
contiguous real property owned by Borrower or any related entity or affiliate of
Borrower; (e) to the best of Borrower's knowledge, that no release of any such
hazardous or toxic substance has occurred on the Mortgaged Property or on any
adjacent and contiguous real property owned by Borrower or any related entity or
affiliate of Borrower; (f) to the best of Borrower's knowledge, that no part of
the Mortgaged Property or any adjacent and contiguous real property owned by
Borrower or any related entity or affiliate of Borrower, including the
groundwater located thereon, is presently contaminated by such hazardous or
toxic substance; and (g) that Borrower has not received any notice from any
governmental agency or authority or from any tenant under a lease with respect
to any such release of hazardous or toxic materials onto the Mortgaged Property
or adjacent parcels of real property. Borrower further covenants and agrees with
Bank that, throughout the term of the Note: (h) the Mortgaged Property shall be
operated and maintained in compliance with all applicable governmental or
regulatory requirements; (i) Borrower shall maintain or procure all necessary
permits, licenses, and certificates required by federal, state, and local laws
throughout the Loan term; (j) all hazardous or toxic substances, within the
definition of any applicable statute or regulation, which may be used by any
person for any purpose upon the Mortgaged Property, shall be used or stored
thereon only in a safe and approved manner, in accordance with all industrial
standards and all laws, regulations and requirements for such storage
promulgated by any applicable governmental agency or authority; (k) other than
as described in (j) above, the Mortgaged Property will not be used for the
purpose of storing such substances; and (1) other than as described in above, no
such storage or use will otherwise be allowed on the Mortgaged Property (whether
through leases with tenants who might store or use hazardous substances or
otherwise) which will cause, or which will increase the likelihood of causing,
the release of such hazardous or toxic substances onto the Mortgaged Property.
Borrower shall immediately notify Bank of any failure to comply under this
paragraph or receipt of an notice of violation or third party complaint.
Borrower hereby agrees to indemnify and save and hold Bank harmless
21
of and from all claims, damages, loss, liabilities, penalties, fines, remedial
action requirements, and enforcement actions, along with the costs and
attorneys' fees incurred by Bank in defending Borrower's use, generation,
transportation, and disposal, release, or threatened release of hazardous
substances, including without limitation, asbestos containing materials or
damage whatsoever incurred by Bank arising out of or by reason of any violation
of any applicable statute or regulation for the protection of the environment
which occurs upon the Mortgaged Property, or by reason of the imposition of any
governmental lien for the recovery of environmental clean-up costs expended by
reason of such violation, including without limitation any lien arising pursuant
to any so-called "Super Fund" or "Super Lien" legislation; provided, however,
that to the extent that Bank is strictly liable under any such statute or
regulation, Borrower's obligation to Bank under this indemnity shall likewise be
without regard to fault on the part of Borrower with respect to the violation of
law which results in liability to Bank. A default under this paragraph shall
constitute a Default under this Mortgage subject to any cure periods set forth
in the Loan Agreement. It is expressly acknowledged by Borrower that this
indemnification shall survive in accordance with the terms and conditions set
forth in the Hazardous Substance Certificate and Indemnification Agreement of
even date herewith executed by the Borrower and Guarantor.
38. ENVIRONMENTAL ASSESSMENTS. At any time deemed necessary by Bank, in
its reasonable and sound business judgment, Bank may, at its election, obtain
one or more environmental assessments of the Mortgaged Property prepared by a
geohydrologist, an independent engineer, or other qualified consultant or expert
approved by Bank evaluating or confirming (i) whether any Hazardous Substances
are present in the soil or water at the Mortgaged Property and (ii) whether the
use and operation of the Mortgaged Property comply with all applicable
Environmental Laws relating to air quality, environmental control, release of
oil, hazardous materials, hazardous wastes and hazardous substances, and any and
all other applicable environmental laws. Environmental assessments may include
detailed visual inspections of the Mortgaged Property including, without
limitation, any and all storage areas, storage tanks, drains, dry xxxxx, and
leaching areas, and the taking of soil samples, surface water samples, and
ground water samples, as well as such other investigations or analyses as are
necessary or appropriate for a complete determination of the compliance of the
Mortgaged Property and the use and operation thereof with all applicable
Environmental Laws. All such environmental assessments shall be at the sole cost
and expense of Borrower. In the event it is determined that additional tests
and/or remediation are necessary as a result of the aforesaid assessments, or in
the event such additional testing or remediation is recommended by the aforesaid
assessments, the Borrower agrees to immediately perform the tests or undertake
the remediation as recommended. In the event contamination or an environmental
problem is found on the Mortgaged Property, the Borrower shall be in Default
hereunder after a thirty (30) day cure period.
39. SUBROGATION. To the extent of the indebtedness of the Borrower to
the Bank described herein or secured hereby, the Bank is hereby subrogated to
the lien or liens and to the rights of the owners and holders of each and every
mortgage, lien or other encumbrance on the land described herein which is paid
and/or satisfied, in whole or in part, out of the proceeds of the loan described
herein or secured hereby, and the respective liens of said mortgages, liens or
other encumbrances, shall be and the same and each of them hereby is preserved
and shall pass to and be held by the Bank herein as security for the
indebtedness to the Bank herein described or hereby secured, to the same extent
that it would have been preserved and would have been passed to and been held by
the Bank had it been duly and regularly assigned, transferred, set over, and
delivered unto the Bank by separate deed of assignment, notwithstanding the fact
that the same may be satisfied and canceled of record, it being the intention of
the parties hereto that the same will be satisfied and canceled of record by the
holders thereof at or about the time of the recording of this Mortgage.
40. MANDATORY ARBITRATION. Any controversy or claim between or among
the parties hereto including but not limited to those arising out of or relating
to this Agreement or any related agreements or instruments, including any claim
based on or arising from an alleged tort, shall be determined by binding
arbitration in accordance with the Federal Arbitration Act (or if not
applicable, the applicable state law), the Rules of Practice and Procedure for
the Arbitration of Commercial Disputes of Judicial Arbitration and Mediation
Services, Inc. (J.A.M.S.), and the "Special Rules" set forth below. In the event
of any inconsistency, the Special Rules shall
22
control. Judgment upon any arbitration award may be entered in any court having
jurisdiction. Any party to this Agreement may bring an action, including a
summary or expedited proceeding, to compel arbitration of any controversy or
claim to which this agreement applies in any court having jurisdiction over such
action.
a. SPECIAL RULES. The arbitration shall be conducted in the County
of Broward, Florida and administered by Endispute, Inc., d/b/a
J.A.M.S., who will appoint an arbitrator; if J.A.M.S./Endispute is
unable or legally precluded from administering the arbitration, then
the American Arbitration Association will serve. All arbitration
hearings will be commenced within 90 days of the demand for
arbitration; further, the arbitrator shall only, upon a showing of
cause, be permitted to extend the commencement of such hearing for up
to an additional sixty (60) days.
b. RESERVATION OF RIGHTS. Nothing in this Agreement shall be deemed
to (i) limit the applicability of any otherwise applicable statutes of
limitation or repose and any waivers contained
in this Agreement; or (ii) be a waiver by the Bank of the protection
afforded to it by 12 U.S.C. Sec. 91 or any substantially equivalent
state law; or (iii) limit the right of the bank hereto (A) to exercise
self help remedies such as (but not limited to) setoff, or (B) to
foreclose against any real or personal property collateral, or (C) to
obtain from a court provisional or ancillary remedies such as (but not
limited to) injunctive relief or the appointment of a receiver. The
Bank may exercise such self help rights, foreclose upon such property,
or obtain such provisional or ancillary remedies before, during or
after the pendency of any arbitration proceeding brought pursuant to
this Agreement. At Bank's option, foreclosure under a deed of trust or
mortgage may be accomplished by any of the following: the exercise of a
power of sale under the deed of trust or mortgage, or by judicial sale
under the deed of trust or mortgage, or by judicial foreclosure.
Neither this exercise of self help remedies nor the institution or
maintenance of an action for foreclosure or provisional or ancillary
remedies shall constitute a waiver of the right of any party, including
the claimant in any such action, to arbitrate the merits of the
controversy or claim occasioning resort to such remedies.
41. CROSS-DEFAULT. This Loan shall be cross-defaulted with other loans
by Bank to Borrower as more specifically described in the Loan Agreement.
42. RELEASE PROVISION:
PARTIAL RELEASES UNDER THE NOTE. Provided that Borrower is not then in
Default hereunder, under the Note, the Mortgage or any other Loan Document, Bank
will provide partial releases of individual lots from the Note upon the
following terms:
a. Bank shall be given written notice of the request for each
partial release at least five (5) business days prior to each partial
release.
b. The cost of each partial release, including reasonable attorney's
fees for Bank's attorney, shall be paid by Borrower.
c. As to Parcel "D" Pelican Pointe:
Contemporaneously with the delivery to Borrower of each partial
release, Borrower shall prepay principal equal to THIRTY ONE
THOUSAND SIX HUNDRED FIFTY THREE AND NO/100 DOLLARS ($31,653.00) per
developed lot (the "Lot Release Price"). If the value or total
amount funded changes materially, in the sole discretion of Bank,
Bank reserves the right to modify the Lot Release Prices. Such
change in Lot Release Price will be based on relative value of the
collateral subject to the originally contemplated average Lot
Release Price set forth above based on one hundred twenty percent
(120%) accelerated lot release pricing.
23
d. As to Parcel "F" Egret's Way:
Contemporaneously with the delivery to Borrower of each partial
release, Borrower shall prepay principal equal to NINETEEN THOUSAND
THREE HUNDRED FORTY FIVE AND NO/100 DOLLARS ($19,345.00) per
developed lot (the "Lot Release Price"). If the value or total
amount funded changes materially, in the sole discretion of Bank,
Bank reserves the right to modify the Lot Release Prices. Such
change in Lot Release Price will be based on relative value of the
collateral subject to the originally contemplated average Lot
Release Price set forth above based on one hundred twenty percent
(120%) accelerated lot release pricing.
IN WITNESS WHEREOF, Borrower has executed and delivered this Mortgage
as of the date stated above.
Signed, sealed and delivered
in the presence of: TRANSEASTERN PEMBROKE VILLAGES, INC., A
FLORIDA CORPORATION
_____________________________
Witness #1 By ____________________________________(SEAL)
Xxxxxx Xxxxxxx, Executive Vice President
_____________________________
Print Name
_____________________________ Address:
Witness #1
0000 Xxxxxxxxxx Xxxxx
_____________________________ Xxxxx Xxxxxxx, Xxxxxxx 00000
Print Name
STATE OF FLORIDA )
)ss
COUNTY OF BROWARD )
The foregoing instrument was acknowledged before me this ____ day of
September, 1996, by XXXXXX XXXXXXX, as Executive Vice President of TRANSEASTERN
PEMBROKE VILLAGES, INC., a Florida corporation, by and on behalf the
corporation. He is personally known to me and/or has produced
________________________________ as identification.
My Commission Expires: ___________________________________
NOTARY PUBLIC STATE OF FLORIDA
___________________________________
Print Name
24
This Instrument Prepared by:
Xxxxxxx X. Xxxx, Esq.
Xxxxxxx Xxxxxxx & Xxxxx Xxxxx
0000 Xxxxxxx Xxxx, Xxx. 000
Xxxxx Xxxxx, Xxxxxxx 00000
Loan No. 91004439
REAL ESTATE MORTGAGE, ASSIGNMENT,
AND SECURITY AGREEMENT,
(THE "MORTGAGE")
DATE: September ___, 1996
BORROWER:
TRANSEASTERN PEMBROKE VILLAGES, INC., A FLORIDA CORPORATION
0000 Xxxxxxxxxx Xxxxx
Xxxxx Xxxxxxx, Xxxxxxx 00000
BANK:
CHASE FEDERAL BANK, F.S.B., A DIVISION OF NATIONSBANK, N.A. (SOUTH),
a national banking association
000 Xxxx Xxxxxxx Xxxxx Xxxx
Xxxxx 000
Xxxx Xxxxxxxxxx, XX 00000
AMOUNT OF INITIAL LOAN SECURED HEREBY: $3,400,000.00
MAXIMUM POSSIBLE PRINCIPAL DEBT, INCLUDING FUTURE ADVANCES, THAT MAY BE SECURED
HEREBY: $7,200,000.00
LAND: That certain parcel of Land commonly referred to as Parcel "D" -
"Pelican Pointe" located within the NASHER PLAT as recorded in Plat
Book 159 at Page 42, of the Public Records of Broward County, Florida,
and as particularly described on Exhibit "A" attached hereto and
incorporated herein by reference.
1. MORTGAGE. In consideration of Ten Dollars ($10.00) and other
valuable consideration received by Borrower, the receipt and sufficiency of
which are hereby acknowledged, Borrower hereby grants, bargains, sells, assigns,
transfers, conveys and mortgages to Bank, its successors and assigns, to its own
proper use and benefit forever, subject to the terms and conditions of this
Mortgage, the real estate described above as the Land, together with:
a. APPURTENANCES. The benefit of all easements and other rights of
any nature whatsoever, if any, appurtenant to the Land or the
Improvements, or both, the benefit of all rights-of- way, strips and
gores of land, streets, alleys, passages, drainage rights, sanitary
sewer and potable water rights, stormwater drainage rights, rights of
ingress and egress to the Land and all adjoining property,
and any improvements of Borrower now or hereafter located on any of
such real property interests, water rights and powers, oil,
gas, mineral and riparian and littoral rights, whether now existing or
hereafter arising, together with the reversion or reversions, remainder
or remainders, rents, issues, incomes and profits of any of the
foregoing (the "Appurtenances").
b. IMPROVEMENTS. All buildings, structures, betterments and other
improvements of any nature now or hereafter situated in whole or in
part upon the Land or on the Appurtenances, regardless of whether
physically affixed thereto or severed or capable of severance therefrom
(the "Improvements").
c. TANGIBLE PROPERTY. All of Borrower's right, title and interest,
if any, in and to all fixtures, equipment and tangible personal
property of any nature whatsoever that is now or hereafter (i) attached
or affixed to the Land, the Appurtenances, or the Improvements, or (ii)
situated upon or about the Land, the Appurtenances and/or the
Improvements, regardless of whether physically affixed thereto or
severed or capable of severance therefrom, or (iii) used, regardless of
where situated, if used, usable or intended to be used, in connection
with any present or future use or operation of or upon the Land. The
foregoing includes: all goods and inventory, all heating, air
conditioning, lighting, incinerating and power equipment; all engines,
compressors, pipes, pumps, tanks, motors, conduits, wiring, and
switchboards; all plumbing, lifting, cleaning, fire prevention, fire
extinguishing, refrigerating, ventilating, and communications and
public address apparatus; all signage and recreational amenities
including, without limitation, swimming pools, exercise equipment,
tennis courts, clubhouse furnishings or saunas; all boilers, furnaces,
oil burners, vacuum cleaning systems, elevators and escalators; all
stoves, ovens, ranges, disposal units, dishwashers, water heaters,
exhaust systems, refrigerators, cabinets, and partitions; all rugs,
draperies and carpets; all laundry equipment; all building materials;
all furniture (including, without limitation, any outdoor furniture) ,
furnishings, office equipment and office supplies; and all additions,
accessions, renewals, replacements and substitutions of any or all of
the foregoing. The property interests encumbered and described by this
paragraph are called the "Tangible Property" in this Mortgage.
d. All rents, issues, incomes and profits in any manner arising from
the Land, Improvements, Appurtenances or Tangible Property, or any
combination thereof, including Borrower's interest in and to all leases
of whatsoever kind or nature, licenses, franchises and concessions of
or relating to all or any portion of the Land, Appurtenances,
Improvements or Tangible Property,or the operation thereof, whether now
existing or hereafter made, including all amendments, modifications,
replacements, substitutions, extensions, renewals or consolidations
thereof. The property interests encumbered and described in this
subparagraph are called the "Rents" in this Mortgage.
e. SECONDARY FINANCING. All of the Borrower's rights, power or
privilege to further encumber any of the Collateral described in this
paragraph 1, it being intended by this provision to divest Borrower of
the power to encumber or to grant a security interest in any of the
Collateral as security for the performance of an obligation, except for
"Permitted Encumbrances," as defined in paragraph 5 herein.
f. PROCEEDS. All proceeds of the conversion, voluntary or
involuntary, of any of the property encumbered by this Mortgage into
cash or other liquidated claims, or that are otherwise payable for
injury to or the taking or requisitioning of any such property,
including all judgments, settlements and insurance and condemnation
proceeds as provided in this Mortgage.
g. CONTRACT RIGHTS. All of Borrower's right, title and interest in
and to any and all contracts or leases, written or oral, express or
implied, now existing or hereafter entered into or arising, in any
matter related to the improvement, use, operation, sale, conversion or
other disposition of any interest in the Land, Appurtenances,
Improvements, Tangible Property or the Rents, or any combination
thereof, including all tenant leases, sales contracts, payments due and
to become due thereunder; and including, without limitation, contracts
pertaining to maintenance, on-site security service, elevator
maintenance, landscaping services, building or project management,
marketing, leasing, sale and janitorial
2
services; Borrower's interest as lessee in equipment leases, including
telecommunications, computers, vending machines, model furniture,
televisions, laundry equipment; and Borrower's interests in
construction contracts or documents (including architectural and
engineering drawings and plans and specifications relating to the
Improvements), service contracts, use and access agreements,
advertising contracts and purchase orders. The property interest
encumbered and described in this paragraph are called the "Contract
Rights" in this Mortgage. Notwithstanding the foregoing, Bank will not
be bound by any of Borrower's obligations under any of the foregoing
contracts unless and until Bank elects to assume any of such contracts
or leases in writing.
h. NAME. All right, title and interest of Borrower in and to all
trade names, project names, logos, service marks, trademarks, goodwill,
and slogans now or hereafter used in connection with the operation of
the Mortgaged Property except the name of Transeastern Properties,
Inc., a Florida corporation, f/k/a Transeastern Properties of South
Florida, Inc., a Florida corporation.
i. OTHER INTANGIBLES. All contract rights, commissions, money,
deposits, certificates of deposit, letters of credit, documents,
instruments, chattel paper, accounts, and general intangibles [as such
terms from time to time are defined in the Uniform Commercial Code as
adopted by the State of Florida (the "Uniform Commercial Code"], in any
manner related to the construction, use, operation, sale, conversion or
other disposition (voluntary or involuntary) of the Land,
Appurtenances, Improvements, Tangible Property or Rents, including all
construction plans and specifications, architectural plans, engineering
plans and specifications, permits, governmental or quasi-governmental
approvals, licenses, developer rights, vested rights under any Planned
Unit Development or Development of Regional Impact or other project,
zoning, or land use approval, insurance policies, rights of action and
other choice in action.
The Land, Appurtenances, Improvements and Tangible Property are
collectively referred to as the "Mortgaged Property" in this Mortgage.
The portion of the property encumbered by this Mortgage that from time
to time consists of intangible personal property, except for the Rents,
is called the "Intangible Property" in this Mortgage. The Mortgaged
Property, Rents, Intangible Property and any other property interests
encumbered hereby are hereinafter referred to collectively as the
"Collateral". Wherever used in this Mortgage, the use of the terms,
"Mortgaged Property," "Rents", "Intangible Property", and "Collateral"
means and includes all or any portion thereof applicable to the
context.
Notwithstanding the grant of Borrower's interest in the Rents and
Contract Rights above, so long as no Default shall exist hereunder or
under any of the other Loan Documents, Borrower shall have a license to
collect and receive all incomes arising from the operation, ownership,
and maintenance of the Mortgaged Property, Rents and Contract Rights,
but not more than one (1) month prior to accrual.
2. SECURITY AGREEMENT. To the extent any of the Collateral encumbered
by this Mortgage from time to time constitutes personal property subject to the
provisions of the Uniform Commercial Code, this Mortgage constitutes a "Security
Agreement" for all purposes under the Uniform Commercial Code. Without
limitation, Bank, at its election, upon the occurrence of a Default under this
Mortgage, will have all rights, powers, privileges and remedies from time to
time available to a secured party under the provisions of the Uniform Commercial
Code with respect to the Collateral. The names and addresses of debtor and
secured party are as shown for Borrower and Bank, respectively, on the signature
pages hereof. The remedies for any Default under the covenants, terms, and
conditions of the security agreement herein contained shall be (i) as prescribed
herein, or (ii) as prescribed by general law, or (iii) as prescribed by the
specific statutory provisions now or hereafter enacted and specified in the
Uniform Commercial Code, all at Bank's sole election. Borrower and Bank agree
that the filing of financing statements in the records normally having to do
with personal property shall never be construed as in anywise derogating from or
impairing this declaration and hereby stated intention of Borrower and Bank that
everything used in connection with the production of income from the Collateral
or adapted for use therein
3
or which is described or reflected in this Mortgage, is, and at all times and
for all purposes and in all proceedings both legal or equitable shall be,
regarded as part of the real estate irrespective of whether (i) any such item is
physically attached to the Improvements, (ii) serial numbers are used for the
better identification of certain items capable of being thus identified in a
recital contained herein, or (iii) any such item is referred to or reflected in
any financing statement(s) so filed at any time. Similarly, the mention in any
financing statement of the rights in, or the proceeds of, any fire, hazard or
liability insurance policy, or any award in eminent domain proceedings for a
taking or for loss of value, or Borrower's interest as lessor in any present or
future lease, or rights to income growing out of the use of the Mortgaged
Property, whether pursuant to a lease or otherwise, shall not be construed as
altering any of Bank's rights as determined by this Mortgage, or otherwise
available at law or in equity, or impugning the priority of this Mortgage or the
Loan Documents, or both, but such mention in any financing statement is declared
to be for Bank's protection if, as, and when any court holds that notice of
Bank's priority of interest, to be effective against a particular class of
persons, including the federal government and any subdivisions or entities of
the federal government, must be perfected in the manner required by the Uniform
Commercial Code.
Borrower covenants and agrees that Borrower will furnish Bank with
notice of any change in name, identity, organizational structure, mailing
address, residence, or principal place of business thirty (30) days prior to the
effective date of any such change. Borrower will promptly execute any financing
statements or other instruments deemed necessary by Bank to prevent any filed
financing statement from becoming misleading or losing its perfected status or
to reinstate any lapsed financing statement.
3. AFTER-ACQUIRED PROPERTY. Without the necessity of any further act of
Borrower or Bank, the lien of and security interest created by this Mortgage
automatically will extend to and include (i) any and all renewals, replacements,
substitutions, accessions, proceeds, products, additions or after-acquired
property or to the Collateral, and (ii) any and all monies, proceeds and other
property that from time to time, either by delivery to Borrower or by any
instrument (including this Mortgage) may be subjected to such lien and security
interest by Borrower or by anyone on behalf of Borrower, or with the consent of
Borrower, or which otherwise may come into the possession or otherwise be
subjected to the control of Bank or Borrower pursuant to this Mortgage or the
other Loan Documents.
4. DEBT. Borrower is justly indebted to Bank in the principal amount
indicated above (or so much as may be advanced to Borrower by Bank from time to
time), as evidenced by that certain Promissory Note in the original principal
amount of THREE MILLION FOUR HUNDRED THOUSAND AND NO/100 DOLLARS
($3,400,000.00), of even date herewith, made by Borrower, payable to the order
of Bank and maturing as stated in said Notes, unless such maturity is
accelerated or extended (as provided in said Notes) , which Notes, together with
any and all renewals, replacements, extensions, modifications, substitutions,
future advances, and any and all other certificates or evidence of indebtedness
evidenced by said Notes are herein called the "Note".
Borrower's obligations described below are secured, among other things,
by the collateral described in this Mortgage, which term includes any and all
amendments, extensions, renewals, replacements, substitutions, modifications and
consolidations of this Mortgage, and may also from time to time be secured by
other collateral described in written documents. The Mortgage and such other
documents as may exist on the date hereof or may exist hereafter are referred to
as the "Security Documents," which term, as defined in the Note, includes any
and all financing statements, letters of credit, assignments, agreements,
supplements, and riders made and delivered in connection with the Note and this
Mortgage, and any and all amendments, modifications, extensions, renewals,
replacements, substitutions and consolidations thereof or thereto. The Security
Documents, the Note and the Loan Agreement between Borrower and Bank are
referred to collectively as the "Loan Documents". The Loan evidenced by the Note
and secured by this Mortgage is to be disbursed in accordance with the terms and
provisions of a Loan Agreement of even date herewith between Borrower and Bank
(the "Loan Agreement"). The Note, the Mortgage and the Loan Agreement shall
always be taken and read together as constituting part of one transaction. All
sums disbursed pursuant to the terms of the Loan Agreement shall be secured by
this Mortgage with the same priority as if advanced on the date hereof.
4
The obligations of Borrower secured by the Security Documents arising
pursuant to the Loan Documents are as follows and are called the "Debt" in this
Mortgage and the other Loan Documents:
a. NOTE. Borrower's payment of all sums due from time to time as
evidenced by the Note; and
b. LOAN DOCUMENTS. Borrower's payment or performance of all
obligations imposed upon Borrower by the Loan Documents; and
c. ADVANCES. All sums advanced by Bank to or for the benefit of
Borrower in the manner provided in the Loan Documents, or for the
protection of the Security of the Collateral, including, without
limitation, all sums advanced pursuant to this Mortgage, including
advances for repairs, maintenance, insurance, taxes, or assessments;
and
d. COSTS. All costs, expenses, losses, damages and other charges
sustained or incurred by Bank because of: (i) Borrower's Default in
payment or performance, as the case may be, of any provision contained
in the Loan Documents; (ii) defense of actions instituted by Borrower
or a third party against Bank arising out of or related to the Loan, or
in the realizing upon, protecting, perfecting, defending, or (iii)
actions brought or defended by Bank enforcing Bank's security interest
in the Collateral. All of these costs and expenses include reasonable
attorneys' fees, paralegals' fees, or legal assistants' fees, whether
incurred with respect to collection, litigation, bankruptcy proceedings
interpretation dispute, negotiation, trial, appeal, defense of actions
instituted by a third party against Bank, or enforcement of any
judgment based on the Loan Documents, whether or not suit is brought to
collect such amounts or to enforce such rights or, if brought, is
prosecuted to judgment.
e. LETTERS OF CREDIT. All sums advanced by Bank for the benefit of
Borrower under any other instrument or otherwise, including, without
limitation, any amounts paid by Bank under any letters of credit issued
by Bank for the benefit of Borrower.
f. MISCELLANEOUS EXPENSES. All costs and expenses incurred by Bank
in connection with the Loan, whether prior to or at closing or during
the term thereof, including, without limitation, loan origination fees,
commitment fees, extension fees, title insurance search fees, premiums
and endorsement fees, hazard and other insurance required by the Loan
Documents, pre-closing and post-closing appraisals, appraisal reports
or opinions of value, surveys, brokerage commissions and claims of
brokerage in connection with the Loan, ad valorem and personal property
taxes, documentary stamp taxes and intangible taxes, attorneys' fees,
consultant fees, architect's and engineer's fees, construction
consultant's fees, environmental surveys or assessments, and recording
charges.
g. INDEMNITIES. All costs, expenses, and amounts arising under or
pursuant to any indemnity contained within the Loan Documents or in any
separate agreement executed by Borrower in favor of Bank including,
without limitation, the Hazardous Substance Certificate and
Indemnifica- tion Agreement (the "Indemnity").
5. TITLE WARRANTIES. Subject to the Permitted Encumbrances (as
hereinafter defined) , Borrower covenants with Bank that: (i) Borrower is
indefeasibly seized of the Land and Improvements in fee simple, has good and
marketable title to the Collateral and has full power, lawful right and
authority to convey the same in fee simple and to grant Bank a perfected first
lien security interest in the Collateral, and (ii) the Collateral is free and
clear of all liens, encumbrances, restrictions, and security interests of any
nature except for those permitted encumbrances which Bank has previously
approved, as set out in Schedule B of the title insurance policy and
endorsements insuring this Mortgage, which are referred to as "Permitted
Encumbrances" in this Mortgage.
5
6. LIENS. Except as otherwise provided in the Loan Agreement, Borrower
will not create or permit to be created, or to remain, and will promptly
discharge at Borrower's expense any and all liens or encumbrances upon, or
security interests in, the Collateral, or any combination thereof, whether
consensual, common law, statutory, voluntary, involuntary, or arising by
operation of law, except Permitted Encumbrances. Notwithstanding the foregoing,
and except for any construction liens, Borrower may contest the amount, validity
and enforceability of any involuntary or nonconsensual lien, encumbrance or
security interest, including those arising by operation of law, in the manner
provided in paragraph 8 below. Except as otherwise provided in the Loan
Agreement, if any construction lien is filed against the Mortgaged Property,
Borrower agrees to discharge or otherwise remove such lien by bond or otherwise,
within thirty (30) days of imposition of same, but may thereafter contest the
amount or validity of such lien as provided in paragraph 8 below.
7. TAXES AND OTHER IMPOSITIONS. Borrower will pay or cause to be paid,
prior to any delinquency in (i) all property taxes, assessments, water, sewer,
utility and other rents, rates and charges, including all excises, taxes,
levies, license fees, permit fees, impact fees, connection fees, and other fees
and charges, whether general or special, ordinary or extraordinary, foreseen or
unforeseen, that may be assessed, levied or imposed upon the Collateral, or
otherwise arising with respect to the occupancy, use, possession or disposition
thereof, whether or not the failure to pay the same might result in the creation
of a lien upon the Collateral, or any combination thereof; (ii) all franchise,
excise and other taxes, fees and charges assessed, levied or imposed with
respect to Borrower's right to do business in the State of Florida and the
political subdivisions thereof; (iii) all taxes and fees (except for Bank's
state and federal income taxes) that may be levied by the United States of
America or any state or political subdivision thereof, upon Bank or Borrower in
connection with or upon the Loan Documents, or the Debt or its payment, or
collection, or any combination thereof (including all documentary stamp taxes
and intangible taxes plus any penalties and interest charged for the late
payment of any such taxes); and (iv) except as otherwise provided in the Loan
Agreement, all lawful claims and demands of contractors, subcontractors,
mechanics, laborers, materialmen and other lienors which, if unpaid, might
result in the creation of a lien upon the Collateral. The sums payable under
this paragraph are called "Impositions". Nothing contained in this paragraph
will require the payment of any Imposition so long as the amount, validity or
enforceability thereof is contested by appropriate proceedings as provided in
paragraph 8 below. With respect to state and local real and tangible personal
property taxes, however, Borrower will pay same and will furnish Bank with
copies of the receipts for each such payment without demand prior to April 30th
of each year of the Loan and any contest of the same must be by a suit or other
proceeding for a refund. With respect to all other Impositions, Borrower will
furnish Bank with proof of such payment upon demand. If any payment required to
be made by Borrower by this paragraph is prohibited by law, with the result that
Bank becomes liable for its payment, then the Debt will immediately become due
and payable, at Bank's option.
8. CONTESTS. Borrower may contest, by any and all appropriate
administrative, trial or appellate proceedings, or any combination thereof, and
in Bank's name, if required by law, the amount, validity, enforceability or
application of any Imposition that Borrower is required to pay or perform to any
person or entity other than Bank by any provision of this Mortgage or the other
Loan Documents if and only for so long as: (i) Borrower notifies Bank in writing
of its intent to contest the Imposition; (ii) such contest suspends the
collection or enforcement of the item(s) contested; (iii) no part of the
Collateral will be subject to loss, sale or forfeiture before final
determination of any such contest; (iv) neither Borrower nor Bank will be
subject to any criminal liability; (v) Borrower furnishes such security as may
be required by law in connection with each such contest; (vi) the value,
usefulness and marketability of the Collateral will not be adversely impaired by
any such contest; (vii) Borrower otherwise continues to pay and perform, as the
case may be, the Debt and Borrower's obligations under this Mortgage; (viii)
Borrower otherwise is not in Default under any provision of the Loan Documents;
(ix) each such contest is continuously prosecuted diligently to final
determination; (x) Borrower pays or causes to be paid, and defends, indemnities
and holds Bank harmless of and from any and all losses, judgments, decrees and
costs (including all reasonable attorneys, fees) incurred in connection with
each such contest; (xi) Borrower, promptly following final determination of each
such contest, fully pays and discharges all amounts that may be levied,
assessed, charged, imposed or otherwise determined to be payable, together with
all penalties, fines, interests, costs
6
and expenses, and otherwise complies with such final determination, at
Borrower's sole cost and expense; (xii) Borrower furnishes Bank with such
security as Bank reasonably may require to assure Borrower's compliance with all
of the foregoing requirements, and (xiii) such liens are not filed against the
Mortgaged Property pursuant to Chapter 713, Florida Statutes, in which event
such liens must be discharged or transferred to bond pursuant to paragraph 6
above before Borrower contests such liens except as otherwise provided in the
Loan Agreement. So long as Borrower complies with the foregoing and Bank is
promptly reimbursed for all costs and expenses incurred, Bank will cooperate
with Borrower in connection with any such contest.
9. INSURANCE. Until the Debt shall have been discharged by Borrower,
Borrower shall maintain, at Borrower's cost and expense, the following insurance
coverages in full force and effect at all times:
a. HAZARD INSURANCE. Borrower shall keep the Tangible Property and
Improvements which now or hereafter may constitute part of the
Mortgaged Property insured at all times against loss or damage by fire
and other hazards included within the term "all risk" or "extended
coverage" and against such other hazards as Bank may require in the
full insurable value thereof (or such lesser amount as Bank may
authorize in writing) , with an insurer satisfactory to Bank. Such
policy shall include a Replacement Cost and Agreed Amount/Stipulated
Value Endorsement and a Sinkhole Endorsement, if deemed necessary by
Bank.
b. LIABILITY INSURANCE. Borrower will obtain and keep in full force
a "Broad Form Comprehensive General Liability" insurance coverage for
both Borrower and any contractor performing services to the Mortgaged
Property in the minimum coverage amount of TWO MILLION AND NO/DOLLARS
($2,000,000.00) per occurrence for bodily injury and One Hundred
Thousand Dollars ($100,000.00) per occurrence for property damage.
x. XXXXX INSURANCE. If at any time the Land or any portion thereof
is located in a "Flood Hazard Area" pursuant to the Flood Disaster
Protection Act of 1973 or any successor or supplemental act thereto,
flood insurance in the maximum amount available or such other amount as
Bank may reasonably request;
d. BUILDER'S RISK INSURANCE. An "All risk", non-reporting,
completed value builder's risk insurance policy in an amount not less
than loan amount on a per unit basis which policy shall include Agreed
Amount, Replacement Cost, Permit to occupy and Vandalism/Malicious
Mischief Endorsements.
e. OTHER INSURANCE. Machinery insurance, worker's compensation
insurance, wind damage insurance, and other insurance coverages as Bank
may reasonably require.
The policy or policies of insurance shall (i) be from companies and in
coverage amounts acceptable to Bank, (ii) contain a standard mortgagee clause in
favor of Bank naming Bank as a mortgagee and including a lender's loss payee
clause in such policy, as applicable (iii) not be terminable or modified without
thirty (30) days, prior written notice to Bank, and (iv) be evidenced by
original policies or certified copies of policies deposited with Bank, as Bank
may elect, to be held by Bank until the Debt shall have been fully paid and
discharged. Borrower shall furnish Bank satisfactory evidence of payment of all
premiums required and similar evidence of renewal or replacement coverage not
later than thirty (30) days prior to the date any coverage will expire.
Each insurance policy or endorsement required herein shall be written
by an insurer having a rating not less than "A-XI" Best's Rating according to
the most current edition of Best's Key Rating Guide as determined at the time of
the initial policy and at all times during the term hereof. All policies shall
indicate that notices related to such insurance shall be sent to Bank at:
Chase Federal Bank, a Federal Savings Bank,
7
a Division of NationsBank, N.A. (South)
Suite 101 000 Xxxx Xxxxxxx Xxxxx Xxxx
Xx. Xxxxxxxxxx, XX 00000
Attn: Loan Administration Section,
Real Estate Banking Group
If any loss occurs with respect to the Mortgaged Property, Bank is
hereby appointed attorney-in-fact for Borrower to make proof of loss if Borrower
fails to make the same punctually, and to give a receipt for any proceeds
collected under such policies. Borrower will promptly give written notice to
Bank of any loss or damage greater than ONE THOUSAND AND NO/100 DOLLARS
($1,000.00) per Unit or TWENTY FIVE THOUSAND AND NO/100 DOLLARS ($25,000.00)
cumulatively to the Mortgaged Property, and will not adjust or settle any such
loss without Bank's prior written consent, which consent shall not be
unreasonably withheld or delayed. Upon any Default by Borrower under this
Mortgage, all right, title and interest of Borrower in and to all such insurance
policies then in force, including any and all unearned premiums and existing
claims, will inure to Bank, which, at its option, and as attorney-in-fact for
Borrower, may then make, settle and give binding acquittances for claims under
all such policies, and may assign and transfer such policies or cancel or
surrender them, applying any unearned premium in such manner as Bank may elect.
The foregoing appointment of Bank as attorney-in-fact for Borrower is coupled
with an interest, and is irrevocable. Notwithstanding the occurrence of any
casualty or the availability of any insurance proceeds, Borrower will pay the
Debt in the manner required by the Loan Documents.
10. CONDEMNATION. If all or any part of the Collateral, or any interest
therein or right accruing thereto, is taken as a result of, or in lieu or in
anticipation of, the exercise of the right of condemnation or eminent domain, or
by reason of the temporary requisition of the use or occupancy of the Mortgaged
Property, in any event by any government or quasi-governmental authority, civil
or military, or any other party entitled to exercise such powers by law, general
or special, or is devalued or otherwise adversely affected by any of the
foregoing actions, all proceeds payable with respect to any such action are
assigned to Bank and shall be paid to Bank. Bank shall be under no obligation to
question the amount of any such award or compensation and may accept the same in
the amount in which the same shall be paid. The proceeds of any award or
compensation so received shall, at the option of the Bank, either be applied to
the payment of the Debt or be paid over to the Borrower for the restoration of
the Improvement. Borrower, immediately upon obtaining knowledge of the
institution or threatened institution, of any proceedings for the Mortgaged
Property, or any part thereof, by condemnation or eminent domain, will notify
the Bank of the pending of such proceedings. Bank shall have the right to
intervene and participate in any proceedings for and in connection with any
taking referred to in this section. Borrower shall not enter into any agreement
for the taking of the Mortgaged Property or any part thereof with any person or
persons authorized to acquire the same by condemnation or eminent domain, unless
the Bank shall have consented thereto in writing. Any of the foregoing actions
are sometimes called a "condemnation" or "taking" in this Mortgage and the other
Loan Documents. Such proceeds include, without limitation, severance damages,
damages arising from the change of grade of any street or the access thereto,
the taking of air rights and damages caused by noise, pollutants and other
emissions. Notwithstanding any such taking or other injury or decrease in value,
or the availability of any proceeds for any of the foregoing, Borrower shall
continue to pay the Debt in the manner required by the Loan Documents. Bank's
rights under this paragraph will survive the foreclosure or other enforcement of
this Mortgage, and Bank will have the right to receive and retain all proceeds
to the extent of any deficiency which exists upon such foreclosure or other
enforcement, together with legal interest thereon, and to the extent of the
reasonable counsel fees, costs and disbursements incurred by Bank in connection
with the collection of such proceeds. Such right shall exist whether or not a
deficiency judgment shall have been sought or recovered or denied upon the Note.
The remaining balance of such proceeds, if any, will inure to the benefit of the
party entitled thereto by applicable law. Notwithstanding the foregoing, if Bank
uses the net proceeds of the condemnation to reduce the principal balance owed
under the Note, Bank will thenceforth allow those funds to be disbursed to the
Borrower in accordance with the Loan Agreement.
8
11. APPLICATION OF INSURANCE PROCEEDS AND AWARDS. The Borrower will
promptly give the Bank written notice of any damage to or destruction of the
Mortgaged Property or any part thereof, generally describing the nature and
extent of such damage or destruction and the Borrower's best estimate of the
cost of restoring the Mortgaged Property. The Bank shall be entitled to all
insurance proceeds payable on account of such damage or destruction and the
Borrower hereby irrevocably assigns, transfers and sets over to the Bank all
rights of the Borrower to any such proceeds or payments and irrevocably
authorizes and empowers the Bank, at its option and in its sole and absolute
discretion, in the name of the Borrower or otherwise, to file and prosecute what
would otherwise be the Borrower's claim for any such proceeds or payment and to
collect, receipt for and retain the same for disposition in accordance with this
Section. The Bank may, at its sole option, apply all amounts recovered under any
insurance policy required to be maintained by the Borrower hereunder in any one
or more of the following ways: (a) to the payment of the reasonable costs and
expenses incurred by the Bank in obtaining such insurance proceeds, including
the fees and expenses of attorneys and insurance and other experts and
consultants, the costs of litigation, arbitration, mediation, investigations and
other judicial, administrative or other proceedings and all other out-of-pocket
expenses; (b) to the payment of any of the Debt other than indebtedness with
respect to the Note at the time outstanding; (c) to the payment of the principal
of the Note and any interest accrued and unpaid thereon, without regard to
whether any portion or all of such amounts shall be matured or unmatured,
together with interest at the default interest rate on any overdue principal and
(to the extent permitted by applicable law) interest; and, in case such amount
shall be insufficient to pay in full all such amounts, then such amounts shall
be applied, FIRST, to the payment of all amounts of interest accrued on the Note
and unpaid, without preference or priority of any payment of interest over any
other payment of interest or of any other Note, and, SECOND, to the payment of
all amounts of principal at the time outstanding, without preference or priority
of any installment or amount of principal over any other installment or amount
of principal or of any Note over any other Note, but otherwise in such manner
and order as the Bank shall in its sole discretion determine; (d) to fulfill any
of the other covenants contained herein as the Bank may determine; (e) release
to the Borrower for application to the cost of restoring the Mortgaged Property;
or (f) release to the Borrower. In the event of a foreclosure of this Mortgage,
the purchaser of the Mortgaged Property shall succeed to all the rights of the
Borrower including any right to unearned premiums, in and to all policies of
insurance assigned and delivered to the Bank. Notwithstanding the foregoing, if
Bank uses the net proceeds of the insurance proceeds or awards to reduce the
principal balance owed under the Note, Bank will thenceforth allow those funds
to be disbursed to the Borrower in accordance with the Loan Agreement.
Notwithstanding anything in this paragraph to the contrary, if the Bank has
elected to apply proceeds to the Debt, Bank will re-disburse said proceeds in
accordance with the Loan Agreement.
12. MAINTENANCE, REPAIRS, AND RECONSTRUCTION.
a. MAINTENANCE AND REPAIRS. Borrower, at its sole cost and subject
to Bank's satisfaction, shall make all repairs, renewals, replacements,
servicing and reconstruction that are necessary to maintain the
Mortgaged Property in good order, condition and repair. Immediately
following the occurrence of any casualty or other loss, Borrower
promptly will undertake all restoration required or desirable and will
pursue it diligently to completion. The foregoing shall be accomplished
by the Bank funding the insurance proceeds it receives from the insurer
to the Borrower under the terms and conditions of the Loan Agreement
for the construction of individual Units. Borrower shall (i) not strip,
waste, remove or demolish any portion of the Mortgaged Property, nor
suffer or permit any such action; (ii) promptly comply with all laws,
governmental regulations and public or private restrictions or
easements, or both, of any kind affecting the Mortgaged Property or
requiring any alterations or improvements to be made thereon, and (iii)
not commit, suffer or permit any act upon the Mortgaged Property in
violation of any law, subject to Borrower's right' to contest the same
in good faith to conclusion, as provided in paragraph 8 of this
Mortgage. If any public agency or authority requires or commences any
proceedings for the demolition or removal, or both, of any improvements
or portions thereof comprising the Mortgaged Property due to
non-compliance with health, safety, fire or building codes, then,
unless Borrower undertakes to contest such action in the manner
provided in paragraph 8 above and pursues such contest to a successful
conclusion, such action will constitute a Default under this Mortgage.
Borrower will not,
9
without Bank's prior written consent, (i) make any material
alterations, additions or improvements of or to the Mortgaged Property
unless required by the Loan Agreement; (ii) make any material change in
the general nature of the use or occupancy of the Mortgaged Property;
(iii) institute or join or acquiesce in any action to change the
existing zoning or land use classification of the Mortgaged Property,
or (iv) grant easements or licenses affecting the use or operation of
the Mortgaged Property. Bank and any persons authorized by Bank may
enter the Mortgaged Property at all reasonable times without prior
notice for inspections or for any other lawful purpose. If Borrower
fails to comply with the requirements of this paragraph, then Bank,
without waiving the option to foreclose, may take some or all measures
Bank reasonably deems necessary or desirable for the maintenance,
repair, preservation or protection of the Mortgaged Property, and any
expenses reasonably incurred by Bank in so doing shall become part of
the Debt secured hereby, and shall, at the option of Bank, become
immediately due and payable, and shall bear interest at the Default
Rate specified in the Note. Bank shall have no obligation to care for
or maintain the Mortgaged Property, or, having taken some measures
therefor, to continue same or take other measures.
b. RECONSTRUCTION. The Borrower after receipt of net insurance
proceeds from Bank funded in accordance with the Loan Agreement shall
promptly repair, restore, replace or rebuild any part of the Mortgaged
Property, now or hereafter encumbered by this Mortgage which may be
affected by any condemnation proceeding or which may otherwise become
damaged, destroyed, lost or unsuitable for use. In the event the
Mortgaged Property or any part thereof if damaged or destroyed by fire
or other casualty, the Borrower shall immediately notify the Bank, in
writing, of such damage or destruction. The Borrower shall not cause or
permit anything to be done which would or could increase the risk of
fire or other hazard to the Mortgaged Property, or any part thereof, or
which would or could result in an increase in any insurance premiums
payable with respect to the Mortgaged Property, or which would or could
result in the cancellation of any insurance policy carried with respect
to the Mortgaged Property. No part of the Mortgaged Property,
including, but not limited to, any building, structure, water system,
sewer system, parking lot, driveway, landscape scheme, timber or other
ground improvement, equipment or other property, now or hereafter
mortgaged, shall be removed, demolished or materially altered without
the prior written consent of the Bank. No top soil, sand, sod, loam,
clay or gravel shall be mined, stripped, or removed from the Mortgaged
Property without the written consent of the Bank. However, this shall
not prevent or restrict removal of any such materials taken for
excavation necessary to construct a basement, cellar or foundation
footings for the erection of a building or buildings for which a
building permit or permits has or have first been issued by the
governmental authority having jurisdiction thereof; or for the
construction of roadways or the Improvements constructed in accordance
with plans approved by the governmental authorities having jurisdiction
thereof in accordance with the Loan Agreement; provided, nevertheless,
that in the event the required removals become so extensive, as
determined by the Bank, as to create profit by sale of the removed
portion of the Mortgaged Property, said sums shall inure to the benefit
of the Bank to be applied as the Bank so directs, to the reduction of
the Debt.
13. ADVANCES. If Borrower Defaults in the observance or performance of
any of the provisions of the Loan Documents, including but not limited to
obtaining and maintaining insurance pursuant to paragraph 9, paying Impositions
pursuant to paragraph 7, and maintaining the Mortgaged Property pursuant to
paragraph 12, then Bank, without waiving or otherwise impairing any other of its
rights or remedies, at its sole option and without obligation to do so, and
without demand upon Borrower, may make any such payment or take such action as
Bank deems necessary or appropriate to correct such Default, or to protect the
security of the Collateral encumbered by the Loan Documents. All payments so
made, together with all costs and expenses so incurred, will be added to the
principal amount due under the Note and thereafter will bear interest at the
rate then payable as provided for in the Note, and will be secured by the lien
and security interest granted by the Security Documents. For the foregoing
purposes, Bank is authorized to (a) enter upon the Mortgaged Property; (b)
appear in and defend any action or proceeding purporting to affect the security
of this Mortgage or the rights or powers of Bank hereunder; (c) pay, purchase,
contest or compromise any encumbrance, charge or lien that in the reasonable
judgment of Bank appears
10
to adversely affect the Collateral; and (d) take whatever action Bank, in its
discretion, deems necessary or appropriate in exercising any such powers.
Notwithstanding the foregoing, Borrower immediately, upon Bank's demand, will
pay all sums so expended by Bank with interest as stated above.
14. BOOKS AND RECORDS. Borrower, at all times, will keep proper books
of record and account in which full, true and correct entries will be made of
its transactions with respect to the Collateral in accordance with generally
accepted accounting principles, consistently applied, and which will properly
and correctly reflect all items of income and expense in connection with the
operation of the" Collateral, regardless of whether such income or expense is
realized by Borrower or any other person or entity whatsoever. Bank will have
the right from time to time during normal business hours to examine all such
books, records and accounts at Borrower's office or at the office of such other
person as maintains them, and to make such copies or extracts as Bank may
desire, at Borrower's expense.
15. TAXATION OF MORTGAGE. In the event of the passage after the date of
this Mortgage of any federal, state or local law deducting from the value of
real property for the purpose of ad valorem taxation any lien thereon or
changing in any way the laws for the taxation of mortgages or debts secured by
mortgages for federal, state or local purposes, or the manner of the collection
of any such taxes, and imposing a tax, either directly or indirectly, on any or
all of the Loan Documents, Bank shall have the right to declare the Debt due on
a date to be specified by not less than sixty (60) days' written notice given to
Borrower by Bank; provided, however, that such election shall be ineffective if
Borrower is permitted by law to pay the whole of such tax in addition to all
other payments required hereunder, and if Borrower, prior to such specified
date, does pay such tax and agrees to pay any such tax (excluding, however, all
taxes on the income of Bank) when thereafter levied or assessed, and such
agreement shall constitute a modification of this Mortgage. Notwithstanding any
provision in this paragraph to the contrary, Borrower may contest the matters
described herein per the procedures set forth in paragraph 8 above.
16. ASSIGNMENT OF RENTS, LEASES, PROFITS AND CONTRACT RIGHTS. Pursuant
to paragraph 1 of this Mortgage, Borrower has irrevocably assigned and set over
unto Bank all right, title, and interest of Borrower in and to the Rents and
Contract Rights (including all leases and sales contracts now or hereafter
existing relating to the Mortgaged Property) as security for the Debt, together
with the right to collect and enforce the same; provided, however, so long as
there shall be no Default under the Loan Documents, Borrower has been granted a
license to collect and receive all Rents assigned hereunder in accordance with
paragraph 1. Neither these assignments nor Bank's enforcement of the provisions
of these assignments (including the receipt of the Rents) will operate to
subordinate the lien of this Mortgage to any of the rights of any lessee or
purchaser under any lease or sales contract of the Mortgaged Property, or to
subject Bank to any liability to any such lessee or purchaser for the
performance of any obligations of Borrower under any such lease or sales
contract unless and until Bank agrees to such subordination or assumes such
liability by an appropriate written instrument. All right, title and interest of
each such lessee or purchaser in and to the Mortgaged Property, whether arising
by virtue of any such lease, contract or otherwise, at all times will be and
remain subject, subordinate and inferior to the lien of this Mortgage and all
rights, remedies, powers and privileges of Bank arising under or by virtue of
any of the Loan Documents. The assignments of Rents and Contract Rights
(including leases) contained in this Mortgage are intended to provide Bank with
all the rights and remedies of mortgagees pursuant to Section 697.07, Florida
Statutes, as may be amended from time to time. However, in no event shall this
reference diminish, alter, impair, or affect any other rights and remedies of
Bank. Notwithstanding the foregoing, if Borrower shall have executed an
Assignment of Rents constituting one of the Loan Documents, such Assignment of
Rents is hereby incorporated herein by reference and shall control if in
conflict with the provisions of this Mortgage.
17. LEASES AFFECTING MORTGAGED PROPERTY. The assignments contained in
paragraph 1 shall not be deemed to impose upon Bank any of the obligations or
duties of Borrower provided in any lease affecting the Mortgaged Property
(including, without limitation, any liability under the covenant of quiet
enjoyment contained in any lease in the event that any tenant shall have been
joined as a party defendant in any action to foreclose this Mortgage and shall
have been barred and foreclosed thereby of all right, title and interest and
equity
11
of redemption in the Mortgaged Property or any part thereof), and Borrower will
comply with and observe its obligations as landlord under all leases affecting
the Mortgaged Property or any part thereof. Borrower has a license to collect
the Rents, but shall not accept payment of rent more than one month in advance
without the prior written consent of the Bank, and only so long as there is no
Default hereunder or under the other Loan Documents. Borrower shall receive the
Rents in trust on Bank's behalf, and Borrower covenants to apply same to the
payment of taxes and assessments upon the Mortgaged Property, to the cost of
insurance and maintenance and repairs, and to the payment of the Debt, before
using any part of the Rents for any other purpose.
Prior to a Default hereunder and demand by Bank for delivery of
security deposits held by Borrower or any agent of Borrower to Bank or its
designee, Borrower shall maintain all security deposits pursuant to the leases
in a separate, identifiable account deposited with Bank, or any other
institution acceptable to Bank, and in accordance with all applicable laws and
regulations. Upon delivery of such security deposits to Bank, or upon Bank's
enforcement of its security interest in such deposits, Bank shall hold such
security deposits pursuant to the terms of the leases in respect of which such
deposits were obtained by Borrower and in accordance with applicable law;
provided, however, in no event shall Bank be liable to any lessee of any part of
the Mortgaged Property for the return of any security deposit in any amount in
excess of the amount delivered to Bank by Borrower. Any security deposits held
by Bank shall not bear interest unless required by applicable law.
Borrower will: (a) not collect any of the Rents arising or accruing
under any lease in advance of the time when the same shall become due, other
than as required to be paid in advance by the terms of any lease, but in no
event more than one (1) month in advance; (b) not pledge, transfer, mortgage or
otherwise encumber or assign any of Borrower's interest in the leases or any
Rents arising or accruing therefrom; (c) not waive, excuse, condone, discount,
set-off, compromise, or in any manner release or discharge any tenant thereunder
of and from any obligations, covenants, conditions and agreements by said tenant
to be kept, observed and performed, including the obligation to pay the rents
thereunder, in the manner at the place and time specified therein; (d) not
cancel, terminate or consent to any surrender of any lease, nor modify, alter or
change any of the terms thereof without the prior written consent of Bank; (e)
not consent to any assignment of or subletting under any lease, whether or not
in accordance with the terms thereof, without the prior written consent of Bank;
and (f) not enter into, execute or deliver any leases without the prior written
consent of Bank.
In the event any tenant of the Mortgaged Property should be the subject
of any proceeding under the Federal Bankruptcy Code, as amended from time to
time, or any other federal, state or local statue which provided for the
possible termination or rejection of any of the leases assigned hereby, Borrower
covenants and agrees that if any of the leases is so terminated or rejected, no
settlement for damages shall be made without the prior written consent of Bank,
and any check in payment of damages for termination or rejection of any such
lease will be made payable both to Borrower and Bank. Borrower hereby assigns
any such payment to Bank and further covenants and agrees that upon the request
of Bank, it will duly endorse to the order of Bank any such check, the proceeds
of which will be applied to that portion of the Debt as Bank may elect.
From time to time, Borrower agrees to obtain tenant estoppel
certificates from each tenant of the Mortgaged Property containing such
information as may be reasonably requested by Bank.
18. DEFAULT. The occurrence of any of the following (time being of the
essence as to this Mortgage and all of its provisions) constitutes a "Default"
by Borrower under this Mortgage, and, at the option of Bank, under the other
Loan Documents:
a. SCHEDULED PAYMENT. Borrower's failure to make any payment
required under the Note when due or within any applicable grace period.
b. MONETARY DEFAULT. Borrower's failure to make any other payment
required by this Loan Agreement or the other Loan Documents when due.
12
c. OTHER. Borrower's failure to perform any other obligation
imposed upon Borrower by this Loan Agreement or any other Loan Document
within thirty (30) days after the date when performance is due. This
provision shall not be construed to provide Borrower with any grace
period in complying with any obligations imposed on Borrower by the
terms of the Loan Documents. Notwithstanding the foregoing provision,
Bank shall give Borrower notice, as defined in the Mortgage, of any
non-monetary default after which Borrower shall have a thirty (30) day
cure period, unless such non-monetary default is not capable of being
cured within said thirty (30) day period, in which case Borrower shall
have sixty (60) days to cure such default following the date
performance is due provided Borrower has commenced and is diligently
pursuing the cure for such default (which determination shall be made
in Bank's sole and absolute discretion), and provided such additional
time to cure such default does not negatively affect the value of the
collateral or the preservation of the collateral's value, which
determination shall be made in Bank's sole and absolute discretion..
d. REPRESENTATION. Any representation or warranty of Borrower
contained in this Loan Agreement or in any certificate delivered
pursuant hereto, or in any other instrument or statement furnished in
connection herewith, proves to be incorrect or misleading in any
adverse respect as of the time when the same shall have been made,
including, without limitation, any and all financial statements,
operating statements, and schedules attached thereto, furnished by
Borrower or any guarantor of the Loan to Bank or pursuant to any
provision of this Loan Agreement.
e. BANKRUPTCY. Borrower or any general partner of Borrower or any
guarantor of the Loan (i) files a voluntary petition in bankruptcy or a
petition or answer seeking or acquiescing in any reorganization or for
an arrangement, composition, readjustment, liquidation, dissolution, or
similar relief for itself pursuant to the United State Bankruptcy Code
or any similar law or regulation, federal or state, relating to any
relief for debtors, now or hereafter in effect; or (ii) makes an
assignment for the benefit of creditors or admits in writing its
inability to pay or fails to pay its debts as they become due; or (iii)
suspends payment of its obligations or takes any action in furtherance
of the foregoing; or (iv) consents to or acquiesces in the appointment
of a receiver, trustee, custodian, conservator, liquidator or other
similar official of Borrower, a general partner of Borrower, or any
guarantor, for all or any part of the Collateral or other assets of
such party, or either; or (v) has filed against it an involuntary
petition, arrangement, composition, readjustment, liquidation,
dissolution, or an answer proposing an adjudication of it as a bankrupt
or insolvent, or is subject to reorganization pursuant to the
United-States Bankruptcy Code, an action seeking to appoint a trustee,
receiver, custodian, or conservator or liquidator, or any similar law,
federal or state, now or hereinafter in effect, and such action is
approved by any court of competent jurisdiction and the order approving
the same shall not be vacated or stayed within sixty (60) days from
entry; or (vi) consents to the filing of any such petition or answer,
or shall fail to deny the material allegations of the same in a timely
manner.
f. JUDGMENTS. (1) A final judgment other than a final judgment in
connection with any condemnation is entered against Borrower,
Guarantors, or any general partner of Borrower, that (i) adversely
affects the value, use or operation of the Land or the improvements in
Bank's sole judgment, or (ii) adversely affects, or may adversely
affect, the validity, enforceability or priority of the lien or
security interest created by the Mortgage or any other Loan Document in
Bank's sole judgment, or both; or (2) execution or other final process
issues thereon with respect to the Land or the Improvements; and (3)
Borrower, Guarantor, or any general partner of Borrower, does not
discharge the same or provide for its discharge in accordance with its
terms, or procure a stay of execution thereon, in any event within
thirty (30) days from entry, or Borrower shall not, within such period
or such longer period during which execution on such judgment shall
have been entered, and cause its execution to be stayed during such
appeal, or if on appeal such order, decree or process shall be affirmed
and Borrower shall not discharge such judgment or provide for its
discharge in accordance with its terms within sixty (60) days after the
13
entry of such order or decree or affirmance, or if any stay of
execution on appeal is released or otherwise discharged.
g. LIENS. Any federal, state or local tax lien or any claim of lien
for labor or materials or any other lien or encumbrance of any nature
whatsoever is recorded against Borrower or the Land or Improvements and
is not removed by payment or transferred to substitute security in the
manner provided by law, within thirty (30) days after it is recorded in
accordance with applicable law.
h. OTHER NOTES OR MORTGAGES. Borrower's default in the performance
or payment of Borrower's obligations under any other note which remains
uncured after any applicable grace period, or under that certain Real
Estate Mortgage, Assignment and Security Agreement of even date
herewith in favor of Bank, securing a note in the original principal
amount of THREE MILLION AND NO/100 DOLLARS ($3,000,000.00) and
encumbering that portion of the Land commonly referred to as Parcel "F"
and that certain Real Estate Mortgage, Assignment and Security
Agreement of even date herewith in favor of Bank, securing a note in
the original principal amount of THREE MILLION FOUR HUNDRED THOUSAND
AND NO/100 DOLLARS ($3,400,000.00), and encumbering that portion of the
Land commonly referred to as Parcel "D", or under any other mortgage
encumbering all or any part of the Land or the Improvements, if the
other mortgage is permitted by the Bank, whether such other note or
mortgage is held by Bank or by any other party, and unless otherwise
agreed to by separate written agreement between Bank and such other
mortgage holder.
i. BORROWER DEFAULT UNDER LOAN DOCUMENTS. Borrower's default in the
payment or performance following expiration of any applicable grace
period of any of Borrower obligations under any of the Loan Documents,
including this Mortgage and any riders thereto.
j. GUARANTOR DEFAULT.
i) The default after expiration of any applicable grace period
in the payment or performance of any obligation of a Guarantor of
the Note arising under its guaranty or pursuant to any other Loan
Documents; or
ii) The death of any Guarantor and the failure of Borrower to
provide Bank with an alternate guaranty or alternate collateral
satisfactory to Bank in its sole and absolute discretion within
sixty (60) days of the date of Guarantor's death.
k. BORROWERS/GENERAL PARTNER'S CONTINUED EXISTENCE. Borrower or any
corporate General Partner of Borrower shall cease to exist or to be
qualified to do or transact business in the State in which the Land and
Improvements are located, or shall be dissolved or shall be a party to
a merger or consolidation, or shall sell all or substantially all of
its assets, or shall change its corporate name or trade name without
prior written notice to Bank.
l. STOCK IN BORROWER/CHANGE IN PARTNERS. If Borrower is a limited
partnership and without the prior written consent of Bank, any shares
of stock of any corporate general partner of Borrower are issued, sold,
transferred, conveyed, assigned, mortgaged, pledged, or otherwise
disposed of so as to result in change of control of Borrower, whether
voluntarily or by operation of law, and whether with or without
consideration, or any agreement for any of the foregoing is entered
into; or, if any general partnership interest or other equity interest
in the Borrower is sold, transferred, assigned, conveyed, mortgaged,
pledged, or otherwise disposed of, whether voluntarily or by operation
of law, and whether with or without consideration, or any agreement for
any of the foregoing is entered into, or any general partner of
Borrower withdraws from the partnership.
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m. TRANSFER OF PROPERTY OR OWNERSHIP. Any sale, conveyance,
transfer, assignment, or other disposition or encumbrance of all or any
part of the Land, Improvements, or the Approved Project, or any
ownership interest in Borrower or any guarantor without the prior
consent of Bank or except as otherwise permitted hereby, or as outlined
in the prospectus for public offering for Transeastern Properties,
Inc., a Florida corporation delivered to Bank by Borrower.
n. FALSE STATEMENT. Any statement or representation of Borrower or
any guarantor contained in the loan application or any financial
statements or other materials furnished to Bank or any other Bank prior
or subsequent to the making of the Loan secured hereby are discovered
to have been false or incorrect or incomplete.
o. DEFAULT UNDER INDEMNITY. Borrower or Guarantor shall default
after any applicable grace period under any obligation imposed by any
indemnity contained within any of the Loan Documents including the
Hazardous Waste Certification and Indemnification.
p. OTHER DEFAULTS. Borrower or Guarantor shall Default under any
other Default provision set forth in the Loan Agreement, which is not
cured within any applicable grace period.
19. REMEDIES. Upon the occurrence and continuance, if applicable, of
any Default, Bank may exercise any one or more of the following rights and
remedies, in addition to all other rights and remedies otherwise available at
law or in equity:
a. OTHER DOCUMENTS. To pursue any right or remedy provided by the
Loan Documents.
b. ACCELERATION. To declare the entire unpaid amount of the Debt
together with all accrued and unpaid interest thereon immediately due
and payable with interest to be due thereon at the Default Rate set
forth in the Note.
c. FORECLOSURE. To foreclose the lien of this Mortgage and obtain
possession of the Collateral, by any lawful procedure.
d. CODE RIGHTS. To exercise any right or remedy available to Bank
as a secured party under the Uniform Commercial Code as adopted by the
State of Florida, as it from time to time is in force and effect, with
respect to any portion of the Collateral then constituting property
subject to the provisions of such Code; or Bank, at its option, may
elect to treat the Collateral as real property, or an interest therein,
for remedial purposes.
e. RECEIVER. To apply, on EX PARTE motion, to any court of
competent jurisdiction for the appointment of a receiver to take charge
of, manage, preserve, protect, complete construction of, rent, and
operate the Mortgaged Property and any of Borrower's business or
businesses situated thereon, or any combination thereof; to collect the
Rents; to make all necessary and needed repairs; to pay all taxes,
assessments, insurance premiums and all other costs incurred in
connection with the Mortgaged Property; and, after payment of the
expenses of the receivership, including reasonable attorneys, fees and
other costs and expenses related to the enforcement of the Security
Documents, and after compensation to the receiver for any of the
services described herein or pursuant hereto, to apply all net proceeds
derived therefrom in reduction of the Debt or in such other manner as
the court shall direct. The appointment of such receiver shall be a
matter of strict right to Bank, regardless of the adequacy of the
security or of the solvency of any party obligated for payment of the
Debt. All expenses, fees and compensation incurred pursuant to any such
receivership shall be secured by the lien of this Mortgage until paid.
The receiver, personally or through agents, may exclude Borrower wholly
from the Mortgaged Property and have, hold, use, operate, manage and
control the Mortgaged Property and may, in the name of Borrower,
exercise all of
15
Borrower's rights and powers to maintain, construct, operate, restore,
insure and keep insured the Mortgaged Property in such manner as such
receiver deems appropriate.
f. SET-OFFS. Intentionally deleted.
g. RENTS. After Bank shall have given written notice to Borrower,
to collect all rents, issues, profits, revenues, income, proceeds, or
other benefits from the Collateral, or to pursue any remedy available
under Chapter 697.07, Florida Statutes, as amended, supplemented, or
superseded from time to time.
h. OTHER SECURITY. To proceed to realize upon any and all other
security for the Debt in such order as Bank may elect; no such action,
suit, proceeding, judgment, levy, execution or other process will
constitute an election of remedies by Bank or will in any manner alter,
diminish or impair the lien and security interest created by this
Mortgage or any other Security Documents unless and until the Debt is
paid in full.
i. ADVANCES. To advance such monies and take such other action as
is authorized by paragraphs 13 and 25 herein.
20. WAIVER OF CERTAIN RIGHTS. Borrower will not claim, take or insist
upon any benefit or advantage of any present or future stay, extension,
redemption or moratorium law that may affect Borrower's obligations hereunder,
or any law providing for the valuation or appraisal of the Mortgaged Property or
any portion thereof prior to any sale or sales that may be made under or by
virtue of this Mortgage. Borrower, for itself and all who may claim under
Borrower, waives, to the extent that it lawfully may, all rights to have the
Mortgaged Property and any other security for the Debt marshaled upon any
foreclosure or otherwise. Borrower hereby waives and renounces all homestead and
exemption rights provided for by the laws of the United States of America and of
any state, including Florida, in and to the Mortgaged Property as against the
collection of the Debt, or any part thereof.
21. FURTHER ASSURANCES. Borrower, from time to time, will execute,
acknowledge, subscribe and deliver to or at the direction of Bank such documents
and further assurances as Bank may reasonably require for the purpose of
evidencing, perfecting or confirming the lien and security interest created by
this Mortgage, or the security intended to be afforded by the Loan Documents, or
both. Without limitation of the foregoing, Borrower will defend, indemnify and
hold Bank harmless with respect to any suit or proceeding in which the validity,
enforceability or priority of the lien or security interest, or both, is
endangered or contested, directly or indirectly, and will provide Bank with such
security for the defense of any such suit or proceeding as Bank reasonably may
require. If Borrower fails to undertake the defense of any such claim in a
timely manner, or fails to furnish Bank with reasonable security for such
defense after notice from Bank, or, in Bank's sole but reasonable determination,
fails to prosecute such defense with due diligence, then Bank is authorized to
take, at the expense of Borrower, all necessary and proper action in defense of
any such claim, including the retention of legal counsel, the prosecution or
defense of litigation and the compromise or discharge of claims, including
payment of all costs and reasonable attorneys' fees. All costs, expenses and
losses, if any, so incurred by Bank, including reasonable attorneys' fees,
regardless of whether suit is brought and, if suit is brought, for all
administrative, trial and appellate proceedings, if any, will constitute
advances by Bank as provided in paragraph 13.
22. CUMULATIVE RIGHTS AND NON-WAIVER. No right or remedy conferred upon
or reserved to Bank by this Mortgage or in any of the other Loan Documents is
intended to be exclusive of any other right or remedy; and each and every right
and remedy is cumulative and in addition to any other right or remedy otherwise
available. Every right, power, privilege and remedy granted Bank by this
Mortgage or any of the other Loan Documents, or both, or otherwise available at
law or in equity may be exercised by Bank from time to time as often as Bank
deems expedient until the Debt is paid in full. Bank's failure to insist at any
time upon the strict
16
observance or performance by Borrower of any of the provisions of this Mortgage
or in any of the other Loan Documents, or to exercise any right or remedy
provided for in this Mortgage or in any of the other Loan Documents, will not
impair any such right or remedy or be construed as a waiver or relinquishment
thereof for the future. Receipt by Bank of any payment required to be made
pursuant to any of the Loan Documents with knowledge of the breach of any
provision of any of the Loan Documents will not constitute a waiver of such
breach. In addition to all other remedies provided in this Mortgage, Bank will
be entitled, to the extent permitted by applicable law, to injunctive relief in
the case of a violation or attempted or threatened violation of any of the
provisions of the Loan Documents or to a decree ordering performance of any of
the provisions of any of the foregoing.
23. JUDGMENT. Bank may seek and recover a judgment for all amounts due
and payable in accordance with the Note or under this Mortgage either before,
after or during the pendency of any other proceedings or action to obtain relief
under or with respect to any of the Loan Documents. Bank's right to seek and
recover any such judgment will not be affected by obtaining any other such
relief. Bank will continue to be entitled to enforce payment of, and to seek and
recover a judgment for, any portion of the Debt remaining due and payable after
the application of any proceeds of any sale of the Collateral pursuant to law.
Neither the lien nor security interest of this Mortgage, nor any rights or
remedies of Bank hereunder or under any of the Loan Documents, will be impaired
in any way by the recovery, of any judgment by Bank against Borrower or any
guarantor of the Debt, or by the levy of an execution under such judgment upon
any portion of the Collateral, until the Debt is paid in full.
24. INDEMNIFICATION. Borrower has read and does hereby approve the
legal description of the Land which is the subject of this Mortgage as set forth
on the first page of this Mortgage or in Exhibit "A" attached hereto, and hereby
indemnifies Bank, its successors or assigns, and their attorneys with respect to
any liability which might arise as a consequence of Section 697.10, Florida
Statutes, or any successors or amendments thereto.
25. RELEASES AND EXTENSIONS BY BANK. Bank, from time to time, without
notice to any person and without affecting the liability of Borrower or of any
guarantor or of any other person (other than any person expressly released by
Bank in writing) for the payment of any of the Debt, and without affecting the
priority or extent of the lien and security interest of this Mortgage (except as
to property specifically released by Bank in writing), may do any or all of the
following: (i) release in whole or in part any person liable for payment of any
or all of the Debt, or (ii) extend the time or otherwise alter the terms of
payment of the Debt, in whole or in part, or (iii) accept additional or
substitute security of any kind, or (iv) release or otherwise deal with all or
any portion of the Collateral.
26. NOTICES. Any notice or demand that must or may be given or made in
connection with this Mortgage must be in writing and, unless receipt is
expressly required, will be deemed given, delivered or made, as the case may be,
when delivered by personal delivery or the day after it is mailed by Express
Mail, by overnight delivery service of a nationally-recognized company, and
addressed to the parties at the addresses written on the first page of this
Mortgage or on the signature pages of this Mortgage. Such addresses may be
changed by notice pursuant to this paragraph. Notice of change of address is
effective only upon receipt. All of the persons executing this Mortgage as
Borrower severally agree that a single notice to Borrower in the manner provided
in this paragraph will be effective to bind each such person for all purposes.
27. ESTOPPEL LETTERS. As and when, from time to time, requested by
either Borrower or Bank, and within ten (10) days after any such request,
Borrower or Bank, as the case may be, will execute and deliver to or at the
direction of Bank or Borrower, as the case may be, such estoppel letters
certifying such matters relating to this Mortgage or the Loan Documents, or
both, as may reasonably be required.
28. TRANSFER. Borrower may not sell, convey, assign, transfer or
otherwise dispose of any interest in all or any portion of the Collateral, or
any ownership interest in Borrower or any guarantor, without Bank's prior
17
written consent, which consent may be withheld in Bank's sole discretion, or as
outlined in the prospectus for public offering for Transeastern Properties,
Inc., a Florida corporation delivered to Bank by Borrower.. Whether such
transfer is voluntary or involuntary, or by operation of law, any such transfer
will be void as to Bank, and constitute an immediate Default under this
Mortgage, without notice, in the sole discretion of Bank. Bank's consent to any
transfer, sale, or conveyance hereunder shall not be deemed a consent to any
subsequent transfer, sale, or conveyance for which Bank's prior written approval
has not been obtained except as provided in the Loan Agreement.
29. REPLACEMENT OF NOTE. Upon receipt of evidence reasonably
satisfactory to Borrower of the loss, theft, destruction or mutilation of the
Note, or any amendment or modification thereto, including without limitation any
renewal note or additional note, and in the case of any such loss, theft, or
destruction, upon delivery of an indemnity agreement, reasonably satisfactory to
Borrower or, in the case of any such mutilation, upon surrender of such
mutilated note, Borrower will execute and deliver, in lieu thereof, a
replacement Note, identical in form and substance to the Note and dated as of
the date of the Note and upon such execution and delivery all references in any
of the Loan Documents to the Note shall be deemed to refer to the replacement
Note.
30. FUTURE ADVANCES. This mortgage is given to secure not only the
existing Debt, but also such future advances, whether such advances are
obligatory or are to be made at the option of Bank, or otherwise, as are made
within twenty (20) years from the date hereof, to the same extent as if such
future advances were made on the date of the execution of this Mortgage. The
total amount of Debt that may be so secured may decrease or increase from time
to time, but the maximum possible principal debt so secured at one time shall
not exceed the amount shown on Page of this Mortgage, plus interest thereon, and
any disbursements made for the payment of taxes, levies or insurance on the
Mortgaged Property, with interest on such disbursements at the rate then in
effect pursuant to the terms of the Note.
31. GENERAL. The provisions of this Mortgage inure to the benefit of
Bank and its successors and assigns, and bind all persons executing this
Mortgage as Borrower and their respective legal representatives, successors and
assigns, jointly and severally, and all persons now or hereafter claiming any
right, title and interest in and to any of the property, real, personal or
mixed, tangible or intangible, now or hereafter existing or any substitutions or
replacements thereof and described in this Mortgage as the Collateral. Time is
of the essence to this Mortgage and each of its provisions. The provisions of
this Mortgage are to be interpreted, construed, applied and enforced in
accordance with the laws of the State of Florida, regardless of where this
Mortgage is executed, delivered or breached, or where any payment or other
performance required by this Mortgage is made, where any action or other
proceeding involving this Mortgage is instituted, or whether the laws of the
State of Florida otherwise would apply the laws of another jurisdiction; the
foregoing choice of law provisions will apply to the Loan Documents. The
provisions of the Loan Documents are severable at Bank's option so that if any
provision is declared by a court of competent jurisdiction to be invalid or
unenforceable, no other provision will be affected by such invalidity or
unenforceability, but will remain in force and effect according to its original
terms, if Bank so elects. Wherever used in this Mortgage or the other Loan
Documents, or both, and unless expressly provided otherwise: (i) use of the
singular includes the plural, and vice versa; (ii) use of one gender includes
all genders; (iii) use of the term "include" or "including" is always without
limitation; (iv) use of the words, "should," "must" and "will" has the same
legal effect as the use of the word "shall"; (v) the term "day" means a banking
day which shall be a day on which Bank and other banks are open for the
transaction of business, excluding any national holidays, and any performance
which would otherwise be required on a day other than a banking day shall be
timely performed in such instance, if performed on the next succeeding banking
day; (vi) any definition herein incorporating one or more documents or items
shall refer to such items "singularly and collectively", and (vii) "person"
means any natural person or artificial entity having legal capacity. Paragraph
headings and subheadings are for indexing purposes only and are not to be used
to interpret, construe, apply or enforce the provisions of this Mortgage.
Borrower and Bank intend the provisions of this Mortgage and the other Loan
Documents to be interpreted, construed, applied and enforced so as to avoid
inconsistencies or conflicting results; but if any such inconsistency or
conflict necessarily occurs, Borrower and Bank intend that the provisions of the
Loan Agreement
18
control unless otherwise provided therein. This Mortgage may be
amended only by a written instrument executed by Borrower and Bank with the same
formalities as this Mortgage.
32. SATISFACTION. The lien and security interest provided by the Loan
Documents will continue unimpaired and in full force and effect unless and until
the Debt is paid in full, whereupon such lien and security interest will be
without further force or effect. Until this Mortgage shall be satisfied of
record, Borrower hereby waives for itself, and all subsequent successors in
title to the mortgaged Property, any right it may now have or hereafter have,
pursuant to Florida Statutes 697.04 (1).(b), as amended from time to time, to
file for record a notice limiting the maximum amount which may be secured by
this Mortgage.
33. DEPOSITS. Bank may, at its sole option upon occurrence of a
Default, require Borrower to make monthly deposits with Bank of a sum equivalent
to one-twelfth (1/12) of the annual real and tangible personal property taxes
assessed with respect to the Mortgaged Property and one-twelfth (1/12) of the
annual premiums for all insurance required to be maintained by this Mortgage. In
addition, upon occurrence of a Default, if required by Bank, Borrower shall also
deposit with Bank a sum of money which, together with the aforesaid monthly
deposits, will be sufficient to make each of such payments for taxes and
insurance at least ten (10) days prior to the date such payments are due. The
amount of such taxes, assessments, and premiums, when unknown, will be estimated
by Bank in good faith. Such deposits may be commingled with Bank's general
funds; Bank will not be liable for any interest on account of such deposits. To
the extent sufficient, such deposits will be applied by Bank to the payment of
such taxes, assessments, and premiums, when due, upon Borrower's presentation of
bills therefor; but Bank will have no obligation to make any such payment except
to the extent of such deposits. Any insufficiency of such deposits will be paid
by Borrower to Bank on demand. Upon any Default by Borrower under this Mortgage,
Bank may apply all such deposits to the Debt in such order as Bank may elect.
The enforceability of Borrower's covenants relating to taxes, assessments, and
insurance provided in this Mortgage will not be altered, diminished, impaired,
or otherwise affected by the provisions of this paragraph except insofar as such
obligations are actually met by Borrower's compliance with this paragraph. Bank
from time to time, at its sole option, may waive and, after any such waiver,
reinstate any or all of the provisions of this paragraph. While any such waiver
is in effect, Borrower will pay all taxes, assessments, and insurance premiums
as provided elsewhere in this Mortgage.
34. BORROWER AS TENANT HOLDING OVER. In the event of a foreclosure sale
of the Mortgaged Property, Borrower shall be deemed a tenant holding over and
shall forthwith deliver possession to Bank or any purchaser or purchasers at
such sale or be summarily dispossessed according to provisions of the law of the
State of Florida applicable to tenants holding over.
35. TIME OF THE ESSENCE. Time is of the essence with respect to each
and every covenant, agreement, and obligation of Borrower under this Mortgage
and the other Loan Documents, and any and all other instruments now or hereafter
evidencing, securing or otherwise relating to the Loan.
36. ORAL MODIFICATION INEFFECTIVE. No term of this Mortgage or any
other of the Loan Documents, or such documents, may be waived, changed,
modified, discharged, or terminated except by an instrument in writing signed by
the party against which enforcement of the waiver, change, modification,
discharge, or termination is sought.
37. HAZARDOUS SUBSTANCES. Borrower hereby represents and warrants to
Bank: (a) that neither Borrower nor any of its subsidiaries is in violation of
any judgment, decree, order, law, license, rule, or regulation pertaining to
environmental matters, including, without limitation, those arising under the
Resource Conservation and Recovery Act ("RCRA") , the Comprehensive
Environmental Response, Compensation, and Liability Act of 1980 as amended
("CERCLA") , the Superfund Amendments and Reauthorization Act of 1986 ("XXXX"),
the Federal Water Pollution Control Act, the Toxic Substances Control Act, or
any state or local statute, regulation, ordinance, order, or decree relating to
health, safety, or the environment (hereinafter "Environmental
19
Laws); (b) that neither Borrower nor any of its subsidiaries has received notice
that it or any of its tenants has been identified by the United States
Environmental Protection Agency as a potentially responsible party under CERCLA
with respect to a site listed on the National Priorities List, 40 C.F.R. Part
000 Xxxxxxxx X (1986); nor has Borrower or any of its subsidiaries received any
notification that any hazardous waste, as defined by 42 U.S.C. ss.6093(5), any
hazardous substances as defined by 42 U.S.C. ss.9601(14), any "pollutant or
contaminant" as defined by 42 U.S.C. ss.9601(33) and any toxic substance,
hazardous materials, oil or other chemicals or substances regulated by any
Environmental Laws ("Hazardous Substances") which it has disposed of has been
found at any site on which a federal or state agency is conducting a remedial
investigation or other action pursuant to any Environmental Law; (c) (i) to the
best of Borrower's knowledge except as disclosed in the Phase I and II
Environmental Report prepared for Bank and Borrower by Law Engineering and
Environmental Services, Inc., a Florida corporation dated November 7, 1995, no
portion of the Mortgaged Property has been used for the handling, processing,
storage, or disposal of Hazardous Substances and no underground tank or other
underground storage receptacle for Hazardous Substances is located on the
Mortgaged Property, (ii) in the course of its activities, neither Borrower nor
any of its subsidiaries has generated or is generating any hazardous waste on
the Mortgaged Property, (iii) to the best of our knowledge there have been no
releases (i.e., any past or present releasing, spilling, leaking, pumping,
pouring, emitting, emptying, discharging, injecting, escaping, leaching,
disposing, or dumping) of Hazardous Substances by Borrower or any of its
subsidiaries on, upon, or into the Mortgaged Property, which releases would have
a material adverse effect on the value of the Mortgaged Property. In addition,
to the best of Borrower's knowledge, there have been no such releases on, upon,
or into any real property in the vicinity of the Mortgaged Property which,
through soil or groundwater contamination, may have come to be located on the
Mortgaged Property; (d) to the best of Borrower's knowledge, that no asbestos,
oil, petroleum or chemical liquids or solids, liquid or gaseous products, or
hazardous or toxic substances, within the meaning of any applicable statute or
regulation, are presently stored or otherwise located on or under the Mortgaged
Property or on or under any adjacent and contiguous real property owned by
Borrower or any related entity or affiliate of Borrower; (e) to the best of
Borrower's knowledge, that no release of any such hazardous or toxic substance
has occurred on the Mortgaged Property or on any adjacent and contiguous real
property owned by Borrower or any related entity or affiliate of Borrower; (f)
to the best of Borrower's knowledge, that no part of the Mortgaged Property or
any adjacent and contiguous real property owned by Borrower or any related
entity or affiliate of Borrower, including the groundwater located thereon, is
presently contaminated by such hazardous or toxic substance; and (g) that
Borrower has not received any notice from any governmental agency or authority
or from any tenant under a lease with respect to any such release of hazardous
or toxic materials onto the Mortgaged Property or adjacent parcels of real
property. Borrower further covenants and agrees with Bank that, throughout the
term of the Note: (h) the Mortgaged Property shall be operated and maintained in
compliance with all applicable governmental or regulatory requirements; (i)
Borrower shall maintain or procure all necessary permits, licenses, and
certificates required by federal, state, and local laws throughout the Loan
term; (j) all hazardous or toxic substances, within the definition of any
applicable statute or regulation, which may be used by any person for any
purpose upon the Mortgaged Property, shall be used or stored thereon only in a
safe and approved manner, in accordance with all industrial standards and all
laws, regulations and requirements for such storage promulgated by any
applicable governmental agency or authority; (k) other than as described in (j)
above, the Mortgaged Property will not be used for the purpose of storing such
substances; and (1) other than as described in above, no such storage or use
will otherwise be allowed on the Mortgaged Property (whether through leases with
tenants who might store or use hazardous substances or otherwise) which will
cause, or which will increase the likelihood of causing, the release of such
hazardous or toxic substances onto the Mortgaged Property. Borrower shall
immediately notify Bank of any failure to comply under this paragraph or receipt
of an notice of violation or third party complaint. Borrower hereby agrees to
indemnify and save and hold Bank harmless of and from all claims, damages, loss,
liabilities, penalties, fines, remedial action requirements, and enforcement
actions, along with the costs and attorneys' fees incurred by Bank in defending
Borrower's use, generation, transportation, and disposal, release, or threatened
release of hazardous substances, including without limitation, asbestos
containing materials or damage whatsoever incurred by Bank arising out of or by
reason of any violation of any applicable statute or regulation for the
protection of the environment which occurs upon the Mortgaged Property, or by
reason of the imposition of any governmental lien for the recovery of
environmental clean-up costs expended by reason of such violation, including
without limitation any lien arising pursuant to any so-called "Super Fund" or
"Super Lien" legislation; provided, however, that to the extent that Bank is
strictly liable under any such
20
statute or regulation, Borrower's obligation to Bank under this indemnity shall
likewise be without regard to fault on the part of Borrower with respect to the
violation of law which results in liability to Bank. A default under this
paragraph shall constitute a Default under this Mortgage subject to any cure
periods set forth in the Loan Agreement. It is expressly acknowledged by
Borrower that this indemnification shall survive in accordance with the terms
and conditions set forth in the Hazardous Substance Certificate and
Indemnification Agreement of even date herewith executed by the Borrower and
Guarantor.
38. ENVIRONMENTAL ASSESSMENTS. At any time deemed necessary by Bank, in
its reasonable and sound business judgment, Bank may, at its election, obtain
one or more environmental assessments of the Mortgaged Property prepared by a
geohydrologist, an independent engineer, or other qualified consultant or expert
approved by Bank evaluating or confirming (i) whether any Hazardous Substances
are present in the soil or water at the Mortgaged Property and (ii) whether the
use and operation of the Mortgaged Property comply with all applicable
Environmental Laws relating to air quality, environmental control, release of
oil, hazardous materials, hazardous wastes and hazardous substances, and any and
all other applicable environmental laws. Environmental assessments may include
detailed visual inspections of the Mortgaged Property including, without
limitation, any and all storage areas, storage tanks, drains, dry xxxxx, and
leaching areas, and the taking of soil samples, surface water samples, and
ground water samples, as well as such other investigations or analyses as are
necessary or appropriate for a complete determination of the compliance of the
Mortgaged Property and the use and operation thereof with all applicable
Environmental Laws. All such environmental assessments shall be at the sole cost
and expense of Borrower. In the event it is determined that additional tests
and/or remediation are necessary as a result of the aforesaid assessments, or in
the event such additional testing or remediation is recommended by the aforesaid
assessments, the Borrower agrees to immediately perform the tests or undertake
the remediation as recommended. In the event contamination or an environmental
problem is found on the Mortgaged Property, the Borrower shall be in Default
hereunder after a thirty (30) day cure period.
39. SUBROGATION. To the extent of the indebtedness of the Borrower to
the Bank described herein or secured hereby, the Bank is hereby subrogated to
the lien or liens and to the rights of the owners and holders of each and every
mortgage, lien or other encumbrance on the land described herein which is paid
and/or satisfied, in whole or in part, out of the proceeds of the loan described
herein or secured hereby, and the respective liens of said mortgages, liens or
other encumbrances, shall be and the same and each of them hereby is preserved
and shall pass to and be held by the Bank herein as security for the
indebtedness to the Bank herein described or hereby secured, to the same extent
that it would have been preserved and would have been passed to and been held by
the Bank had it been duly and regularly assigned, transferred, set over, and
delivered unto the Bank by separate deed of assignment, notwithstanding the fact
that the same may be satisfied and canceled of record, it being the intention of
the parties hereto that the same will be satisfied and canceled of record by the
holders thereof at or about the time of the recording of this Mortgage.
40. MANDATORY ARBITRATION. Any controversy or claim between or among
the parties hereto including but not limited to those arising out of or relating
to this Agreement or any related agreements or instruments, including any claim
based on or arising from an alleged tort, shall be determined by binding
arbitration in accordance with the Federal Arbitration Act (or if not
applicable, the applicable state law), the Rules of Practice and Procedure for
the Arbitration of Commercial Disputes of Judicial Arbitration and Mediation
Services, Inc. (J.A.M.S.), and the "Special Rules" set forth below. In the event
of any inconsistency, the Special Rules shall control. Judgment upon any
arbitration award may be entered in any court having jurisdiction. Any party to
this Agreement may bring an action, including a summary or expedited proceeding,
to compel arbitration of any controversy or claim to which this agreement
applies in any court having jurisdiction over such action.
a. SPECIAL RULES. The arbitration shall be conducted in the County
of Broward, Florida and administered by Endispute, Inc., d/b/a
J.A.M.S., who will appoint an arbitrator; if J.A.M.S./Endispute is
unable or legally precluded from administering the arbitration, then
the American Arbitration Association will serve. All arbitration
hearings will be commenced within 90 days of the demand for
arbitration;
21
further, the arbitrator shall only, upon a showing of cause, be
permitted to extend the commencement of such hearing for up to an
additional sixty 60 days.
b. RESERVATION OF RIGHTS. Nothing in this Agreement shall be deemed
to (i) limit the applicability of any otherwise applicable statutes of
limitation or repose and any waivers contained in this Agreement; or
(ii) be a waiver by the Bank of the protection afforded to it by 12
U.S.C. Sec. 91 or any substantially equivalent state law; or (iii)
limit the right of the bank hereto (A) to exercise self help remedies
such as (but not limited to) setoff, or (B) to foreclose against any
real or personal property collateral, or (C) to obtain from a court
provisional or ancillary remedies such as (but not limited to)
injunctive relief or the appointment of a receiver. The Bank may
exercise such self help rights, foreclose upon such property, or obtain
such provisional or ancillary remedies before, during or after the
pendency of any arbitration proceeding brought pursuant to this
Agreement. At Bank's option, foreclosure under a deed of trust or
mortgage may be accomplished by any of the following: the exercise of a
power of sale under the deed of trust or mortgage, or by judicial sale
under the deed of trust or mortgage, or by judicial foreclosure.
Neither this exercise of self help remedies nor the institution or
maintenance of an action for foreclosure or provisional or ancillary
remedies shall constitute a waiver of the right of any party, including
the claimant in any such action, to arbitrate the merits of the
controversy or claim occasioning resort to such remedies.
41. CROSS-DEFAULT. This Loan shall be cross-defaulted with other loans
by Bank to Borrower as more specifically described in the Loan Agreement.
42. RELEASE PROVISION. Provided that Borrower is not then in Default
hereunder, under the Construction Line, the Mortgage or any other Loan Document,
Bank will provide partial releases of Units from the lien of the Mortgage upon
the following terms:
a. If the partial release relates to developed lots in connection
with a bona fide sale or construction loan on which no home
construction advances have been made:
i. Bank shall be given written notice of the request for each
partial release at least five (5) business days prior to each
partial release.
ii. The cost of each partial release shall be paid by Borrower.
iii. Contemporaneously with the delivery to Borrower of each
partial release, Borrower shall prepay principal in an amount equal
to the amount advanced upon such lot plus accrued interest thereon.
b. If the partial release relates to Units for which advances of
Construction Line proceeds have been made, Borrower shall prepay
principal of the Construction Line in an amount equivalent to the total
actual amount advanced by Bank under the Construction Line on account
of the Unit to be released, together with interest accrued thereon
("Unit Release Price") and the applicable Lot Release Price.
IN WITNESS WHEREOF, Borrower has executed and delivered this Mortgage as of
the date stated above.
Signed, sealed and delivered
in the presence of: TRANSEASTERN PEMBROKE VILLAGES, INC.,
A FLORIDA CORPORATION
--------------------------------
22
Witness #1 By ________________________________(SEAL)
Xxxxxx Xxxxxxx, Executive Vice President
_______________________________
Print Name
_______________________________ Address:
Witness #1
0000 Xxxxxxxxxx Xxxxx
_______________________________ Xxxxx Xxxxxxx, Xxxxxxx 00000
Print Name
STATE OF FLORIDA )
)ss
COUNTY OF BROWARD )
The foregoing instrument was acknowledged before me this ____ day of
September, 1996, by XXXXXX XXXXXXX, as Executive Vice President of TRANSEASTERN
PEMBROKE VILLAGES, INC., a Florida corporation, by and on behalf the
corporation. He is personally known to me and/or has produced
________________________________ as identification.
My Commission Expires: ___________________________________
NOTARY PUBLIC STATE OF FLORIDA
___________________________________P
Print Name
23
TRI-PARTY AGREEMENT
This TRI-PARTY AGREEMENT (this "Agreement") dated as of March 29, 1996 by
and among CHASE FEDERAL BANK, a federal savings bank ("Chase Federal"), AMRESCO
FUNDING CORPORATION, a Delaware corporation ("AMRESCO") and TRANSEASTERN
PEMBROKE VILLAGES, INC., a Florida corporation ("Borrower").
PRELIMINARY STATEMENTS
WHEREAS, the Borrower is or shall be the owner of that certain real
property lying and being in Broward County, Florida and legally described in
Exhibit A attached hereto and made a part hereof (the "Property"); and
WHEREAS, simultaneously herewith, Chase Federal has made a loan to the
Borrower in the principal amount of TEN MILLION ONE HUNDRED FIFTY THOUSAND and
No/100 DOLLARS ($10,150,000.00), together with any reimbursement obligations in
connection with Letter(s) of Credit (the "Chase Federal Loan"); and
WHEREAS, simultaneously herewith, AMRESCO has made a loan to the Borrower
in the principal amount of THREE MILLION DOLLARS ($3,000,000.00) (the "AMRESCO
Loan"), the proceeds of which shall be used by the Borrower for the (i)
acquisition of the Property, and (ii) funding of interest due on the AMRESCO
Loan, all in accordance with the terms and conditions set forth in the AMRESCO
Loan Documents, as hereinafter defined; and
WHEREAS, simultaneously herewith, the Borrower has agreed to pay to the
"Contingent Returns" (as defined in that certain Loan Agreement (the "Loan
Agreement") between Lender and Borrower of Even date herewith) to the extent
that there are net profits from the Property, all in accordance with the terms
and conditions set forth in the AMRESCO Loan Documents; and
WHEREAS, Chase Federal and AMRESCO have agreed to set forth certain rights
between the parties with respect to the Chase Federal Loan and the AMRESCO Loan.
NOW, THEREFORE, for and in consideration of the premises and of the
covenants herein contained, and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto,
intending to be legally bound, covenant and agree as follows:
SECTION 1. DEFINITIONS. The following terms shall have the meanings herein
specified unless the context otherwise requires. Such definitions shall be
equally applicable to the singular and plural forms of the terms defined.
"AMRESCO Loan Documents" shall mean the AMRESCO Note, the AMRESCO Mortgage,
and all other documents executed by Borrower to AMRESCO in connection with the
AMRESCO Loan.
"AMRESCO Mortgage" shall mean those certain mortgages of even date herewith
executed by the Borrower to AMRESCO encumbering the Property which secures the
indebtedness evidenced by the AMRESCO Note and the Borrower's obligations under
the other AMRESCO Loan Documents.
"AMRESCO Note" shall mean that certain promissory note of even date
herewith from Borrower to AMRESCO evidencing the indebtedness to AMRESCO under
the AMRESCO Loan in the original principal amount of THREE MILLION DOLLARS
($3,000,000.00).
"Chase Federal Loan Documents" shall mean (i) the Chase Federal Note, the
Chase Federal Mortgage and all other documents executed by Borrower to Chase
Federal evidencing and securing the Chase Federal A&D Loan, (ii) all documents
executed and delivered by Borrower to Chase Federal evidencing and securing the
Chase Federal Loan.
"Chase Federal Mortgage" shall mean that certain mortgage of even date
herewith executed by the Borrower to Chase Federal encumbering the Property
which secures (i) the indebtedness evidenced by the Chase Federal Note, (ii)
sums disbursed under the Letters of Credit, and (iii) any and all of the
Borrower's obligations under the other Chase Federal Loan Documents.
"Chase Federal Note" shall mean that certain promissory note of even date
herewith from Borrower to Chase Federal evidencing the indebtedness to Chase
Federal under the Chase Federal A&D Loan in the original principal amount of TEN
MILLION ONE HUNDRED FIFTY THOUSAND and no/100 DOLLARS ($10,150,000.00).
"Chase Federaer than the sum of $10,150,000.00, plus amounts owed to Chase
Federal by the Borrower as result of draws under the Letters of Credit, which
shall in no event exceed the principal amount of $3,585,593.78 and all accrued
but unpaid interest on such Letter(s) of Credit, (ii) all accrued and unpaid
interest under the Chase Federal Loan, (iii) all sums advanced by Chase Federal
to prevent impairment of the collateral secured by the Chase Federal Loan
Documents.
"Event of Default" means as such term is defined in the Chase Federal Loan
Documents or as such term is defined in the AMRESCO Documents.
"Letter(s) of Credit" means those certain letters of credit in an aggregate
principal amount which shall not exceed $3,585,593.78 issued by Chase Federal to
applicable
2
governmental authorities to insure completion of certain infrastructure
improvements on the Real Property.
SECTION 2. RIGHTS AND OBLIGATIONS OF CHASE FEDERAL AND AMRESCO
2.1 Chase Federal agrees that Borrower and AMRESCO may enter into
modifications, extensions, replacements and renewals of the AMRESCO Loan
Documents without the consent of Chase Federal provided that the same does not
purport to create a lien or security interest in any collateral of Chase Federal
that would be prior dignity to the interest of Chase Federal pursuant to the
Chase Federal Loan Documents.
2.2 Chase Federal covenants and agrees that, at all times, the collateral
that is subject to the Chase Federal Loan Documents shall secure payment only of
the Chase Federal Loan and said collateral shall not secure payment of any other
loans of the Borrower to Chase Federal.
2.3 Chase Federal covenants and agrees that the payment or repayment terms
(e.g., release prices, maturity date) of the Chase Federal Loan Documents shall
not be amended without prior written notice to AMRESCO.
2.4 Borrower hereby expressly waives and relinquishes any right the
Borrower may have to receive any advance of funds under the terms of the Chase
Federal Loan Documents in excess of the original principal amount of the Chase
Federal Loan as the same may be reduced from time to time, plus the
reimbursement obligations of any of the Letter(s) of Credit. Borrower further
covenants not to accept any advances under the Chase Federal Loan in excess of
the Chase Federal Secured Sum, as the same may be reduced, from time to time.
Chase Federal covenants not to make any advances under the Chase Federal Loan
Documents in excess of the Chase Federal Secured Sum, as the same may be
reduced, from time to time. The Borrower and Chase Federal hereby acknowledge
and agree that the making by Chase Federal of any advances under the Chase
Federal Loan Documents in excess of the Chase Federal Secured Sum, as the same
may be reduced, from time to time, shall constitute a default under the AMRESCO
Loan Documents. Upon request by AMRESCO, Borrower agrees to execute and deliver
to AMRESCO a notice limiting amounts of future advances in accordance with
Florida Statutes Section 697.04(b), which notice may be recorded in the public
records of Broward County, Florida, in AMRESCO's sole discretion.
Notwithstanding anything herein to the contrary, the parties hereto covenant and
agree that as the amount of the Chase Federal Loan is paid down, then advances
cannot thereafter be made by Chase Federal to increase the outstanding principal
amount of the Chase Federal Loan (except for any advances with respect to the
Letter(s) of Credit or sums advanced by Chase Federal to prevent impairment of
the collateral secured by the Chase Federal Loan Documents).
2.5 Chase Federal and Borrower agree that they will not amend or reallocate
any portion of the $425,000 interest reserve in the budget for the Chase Federal
Loan in excess of $50,000 in the aggregate, without the prior written consent of
AMRESCO.
3
2.6 Borrower covenants that the budget for the Chase Federal Loan contains
sufficient funds to construct the improvements that are secured by the Letter(s)
of Credit.
2.7 The Letter(s) of Credit are for improvements, including offsite
improvements, to be constructed solely for the Project.
SECTION 3. EVENTS OF DEFAULT; EXERCISE OF RIGHTS AND REMEDIES. The parties
acknowledge and agree that upon the occurrence of an Event of Default, the
following provisions shall apply:
3.1 The Borrower and Chase Federal hereby acknowledge and agree that an
Event of Default under the terms of the Chase Federal Loan Documents shall
constitute an Event of Default under the AMRESCO Documents entitling AMRESCO to
all rights and remedies set forth therein or otherwise available at law or in
equity. The Borrower and Chase Federal hereby covenant and agree to provide
AMRESCO with copies of all written notices of default sent to the Borrower under
the Chase Federal Loan Documents, simultaneously with the sending of such
notice. Chase Federal hereby acknowledges and agrees that AMRESCO shall have the
right, but not the obligation, to cure any Event of Default by the Borrower
under the Chase Federal Loan Documents within thirty (30) days following the
receipt by AMRESCO of the notice referred to above, in the event of monetary
defaults, and within sixty (60) days (which period shall be extended by another
sixty (60) days in the event that AMRESCO has initiated and is diligently
pursuing the cure) in the case of non-monetary defaults. If an Event of Default
under the Chase Federal Loan Documents is not capable of being cured by AMRESCO,
Chase Federal covenants and agrees that so long as all payments due under the
Chase Federal Loan are current, Chase Federal shall refrain from exercising any
and all remedies available to it under the Chase Federal Loan Documents or
otherwise available at law or equity.
3.2 The Borrower and Chase Federal hereby acknowledge and agree that an
Event of Default under the AMRESCO Loan Documents shall not constitute an Event
of Default under the Chase Federal Loan Documents. Notwithstanding the
foregoing, as an accommodation to Chase Federal, the Borrower and AMRESCO hereby
covenant and agree to provide Chase Federal with copies of all written notices
of default sent to the Borrower under the AMRESCO Loan Documents simultaneously
with the sending of such notice. AMRESCO's failure to send such a notice to
Chase Federal and Chase Federal's failure to receive any such notice of default
shall in no way affect or impair the validity of same. If an Event of Default
under the AMRESCO Loan Documents results in foreclosure proceedings thereof,
such proceeding shall be specifically advertised as under, and subject to, the
lien and operation of the Chase Federal Mortgage and the other Chase Federal
Loan Documents.
3.3 Chase Federal (i) consents to the realization by AMRESCO of any of
AMRESCO's rights in and to any and all collateral for the AMRESCO Loan,
including, without limitation, those rights which result in a change in the
legal or beneficial ownership
4
of the Borrower and to a subsequent change in the legal or beneficial ownership
of the Borrower as a result of the subsequent transfer of the legal or
beneficial ownership interests in the Borrower, and (ii) acknowledges and agrees
that the occurrence of the aforementioned shall not constitute an Event of
Default under the Chase Federal Loan Documentsso long as AMRESCO or its
affiliate owns the collateral that is realized upon.
SECTION 4. REPRESENTATIONS AND WARRANTIES.
4.1 Each of the parties hereto hereby makes the following representations
and warranties as of the date hereof with respect to itself for the benefit of
the other parties hereto:
(a) Each of the parties hereto has all necessary partnership or
corporate power and authority, as the case may be, to execute, deliver and
perform its obligations under this Agreement. All action on the part of the
parties hereto that is required for the authorization, execution, delivery and
performance of this Agreement, in each case has been duly and effectively taken.
(b) This Agreement has been duly executed and delivered by each of
the parties hereto. This Agreement constitutes a legal, valid and binding
obligation of the parties hereto enforceable against them in accordance with the
terms thereof, except as such enforceability (A) may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium and other laws affecting the
enforcement of creditors' rights and remedies generally, and (B) is subject to
general principles of equity (regardless of whether enforceability is considered
in a proceeding in equity or at law).
SECTION 5. AGREEMENT FOR BENEFIT OF PARTIES HERETO. Nothing in this
Agreement, express or implied, is intended or shall be construed to confer upon,
or to give to, any party other than the parties hereto and their respective
successors and assigns , any right, remedy or claim under or by reason of this
Agreement or any covenant, condition or stipulation hereto; and the covenants,
stipulations and agreements contained in this Agreement are and shall be for the
sole and exclusive benefit of the parties hereto and their respective successors
and assigns.
SECTION 6. SEVERABILITY. In case any one or more of the provisions
contained in this Agreement shall be invalid, illegal or unenforceable in any
respect, the validyt, legality and enforceability of the remaining provisions
conrtained herein shall not in any way be affected and/or impaired thereby.
SECTION 7. NOTICES. All notices, demands, certificates or other
communications hereunder shall be in writing and shall be deemed sufficiently
given or served for all purposes when delivered personally, when sent by
certified or registered mail, postage prepaid, return receipt requested or by
private courier service, in each case, with the proper address as indicated
below. Each party may, by written notice given to the other parties, designate
any other address or addresses to which notices, certificates or other
communications to them shall
5
be sent as contemplated by this Agreement. Notices shall be deemed to have been
given if and when received by an officer, manager or suervisor in the department
of the addressee speciried for attention (unless the addressee refuses to accept
delivery, in which case they shall be deemed to have been given when first
presented to the addressee for acceptance). Until otherwise so provided by the
respective parties, all notices, certificates and communications to each of them
shall be addressed as follows:
Chase Federal: Chase Federal Bank, F.S.B.
0000 Xxxxx Xxxxxxx Xxxxx
Xxxxx, Xxxxxxx 00000
Attn: Xxxxxxx X. Xxxxxxxx III
Telephone: (000) 000-0000
With a copy to:
Chase Federal Bank, F.S.B.
0000 Xxxxx Xxxxxxx Xxxxx
Xxxxx, Xxxxxxx 00000
Attn: Xxxxxx Xxxxxx
Telephone: (000) 000-0000
With a copy to:
Xxxxxxx X. Xxxx, Esq.
Xxxxxxx Xxxxxxx & Xxxxx Xxxxx
0000 Xxxxxxx Xxxx Xxxx
Xxxxx 000
Xxxxx xxxx, Xxxxxxx 00000
Telephone: (000) 000-0000
AMRESCO: AMRESCO Funding Corporation
0000 Xxxxxxx Xxxxxxx Xxxxxxx
Xxxxx 0000
Xxxxxx, Xxxxx 00000
Attn: Xx. Xxxxxxx Xxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
With a copy to:
AMRESCO, INC.
0000 Xxxxxxx Xxxxxxx Xxxxxxx
Xxxxx 0000
Xxxxxx, Xxxxx 00000
Attn: General Counsel
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
Borrower: Transeastern Pembroke Villages, Inc.
0000 Xxxxxxxxxx Xxxxx, 0xx Xxxxx
Xxxxx Xxxxxxx, Xxxxxxx 00000
Attn: Xxxxxx X. Xxxxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
SECTION 8. SUCCESSORS AND ASSIGNS. Whenever in this Agreement any party
hereto is named or referred to, the successors and assigns of such party shall
be deemed to be included and all rights, benefits, covenants, promises and
agreements in this Agreement by or on behalf of the respective parties hereto
shall bind and inure to the benefit of the respective successors and assigns of
such parties, whether so expressed or not, provided, however, benefits of this
Agreement shall not inure to the benefit of an assignee that is not a permitted
assignee.
SECTION 9. COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each executed counterpart constituting an original but all
counterparts together constituting only one instrument.
SECTION 10. GOVERNING LAW. This Agreement shall be governed by and
construed and enforced in accordance with the laws of the State of Florida
applicable to contracts made and to be performed in such state. Except as
otherwise provided in this Agreement, the rights and priorities of the parties
shall be determined in accordance with applicable law.
SECTION 11. NO IMPAIRMENTS OF OTHER RIGHTS. Nothing in this Agreement is
intended or shall be construed to impair, diminish or otherwise adversely affect
any other rights that Chase Federal or AMRESCO may have or may obtain against
the Borrower.
SECTION 12. AMENDMENT; WAIVER. No amendment or waiver of any provision of
this Agreement shall be effective unless the same shall be in writing and signed
by all the Secured Parties, and any such waiver or consent shall be effective
only in the specific instance and for the specific purpose for which given. No
delay on the part of any Secured Party in the exercise of any right, power or
remedy shall operate as a waiver thereof, nor shall any single or partial waiver
by such Secured Party of any right, power or remedy preclude any further
exercise thereof, or the exercise of any other right, power or remedy.
SECTION 13. HEADINGS. Headings herein are for convenience only and shall
not be relied upon in interpreting or enforcing this Agreement.
SECTION 14. TERMINATION. This Agreement shall remain in full force and
effect until payment in full of the Chase Federal Loan and the Construction
Loan.
SECTION 15. ENTIRE AGREEMENT. This Agreement, including the documents
referred to herein, embodies the entire agreement and understanding of the
parties hereto and supersedes all prior agreements and understandings of the
parties hereto relating to the subject matter herein contained.
IN WITNESS WHEREOF, the parties hereto have caused this TRI-PARTY Agreement
to be duly executed by their respective officers thereunto duly authorized, as
of the day and year first above written.
Signed, sealed and delivered CHASE FEDERAL BANK, a federal
in the presence of: savings bank
By:
Name: Name: Xxxxxxx X. Xxxxxxxx III
Title: Senior Vice President
AMRESCO FUNDING CORPORATION,
a Delaware corporation
By:
Name: Name: Xxxxxxx X.X. Xxxxx
Title: Vice President
TRANSEASTERN PEMBROKE
VILLAGES, INC., a Florida corporation
By:
Name: Name: Xxxxxx X. Xxxxxxx
Title: President
