LOAN AGREEMENT*
Exhibit
10.1
In San Xxxx, Puerto Rico on the fourteenth (14th) of June of two thousand and five (2005).
APPEAR:
AS
PARTY OF THE FIRST PART: XXXXX CARIBE, INC.
(hereafter the “DEBTOR”), a corporation organized and existing under the laws of
Puerto Rico, with employer tax identification number 00-0000000, represented
in
this act by its president, XXXXXXX
XXXXXX XXXXXXX XXXXXX,
with
social security number ###-##-####, of legal age, married, proprietor and
resident of Dorado, Puerto Rico, who represents and warrants that he is duly
authorized to represent the DEBTOR in this agreement, to which he commits to
proving, when and as often as necessary; and
AS
PARTY OF THE SECOND PART: DORAL BANK
(hereafter “DORAL”), a banking corporation organized and existing under the laws
of Puerto
Rico,
with employer tax identification number 00-0000000, represented in this act
by
its Executive Vice President, XXXXXXX
XXXXXXXXX XXXXXXX,
with
social security number ###-##-####, of legal age, married, banker and resident
of Guaynabo, Puerto Rico, who represents and warrants that he is duly authorized
to represent DORAL in this agreement, to which he commits to proving, when
and
as often as necessary, and
DECLARE,
CONVENE AND PROMISE AS FOLLOWS:
FIRST:
The
DEBTOR represents and warrants that it is owner of one hundred percent (100%)
of
the common stock issued and outstanding of Garrochales Construction and
Development Corporation (hereafter “GARROCHALES”), a corporation organized and
existing under the laws of Puerto Rico, with employer tax identification number
00-0000000, and that GARROCHALES is owner in full and absolute right of the
real
estate described in Addendum I of this agreement, which will hereafter be called
“PROPERTY 1” in this agreement.
SECOND:
The
DEBTOR represents and warrants that GARROCHALES is owner in absolute fee simple
of the property described in Addendum II of this agreement, which will hereafter
be called “PROPERTY 2” in this agreement.
THIRD:
The
DEBTOR represents and warrants that GARROCHALES is owner in absolute fee simple
of the property described in Addendum III of this agreement, which will
hereafter be called “PROPERTY 3” in this agreement.
FOURTH:
The
DEBTOR represents and warrants that it is owner of one hundred percent (100%)
of
the common stock issued and outstanding of Xxxxx State Line, Inc. (hereafter
“XXXXX”) a corporation duly organized under the laws of the state of Florida,
United States of North America, and that XXXXX is owner in absolute fee simple
of the property described in Addendum IV of this agreement, which will hereafter
be called “PROPERTY 4” in this agreement.
* This is an English translation
of
the original Loan Agreement entered into between Xxxxx Caribe, Inc. and Doral
Bank. Pursuant to Rule 306 of Regulation S-T, a signed original of
the
original Loan Agreement has been retained by the Company and will be furnished
to the Securities and Exchange Commission upon request.
FIFTH:
The
DEBTOR has requested of DORAL a loan or financing of a revolving credit line,
for the principal sum of THREE MILLION FIVE HUNDRED THOUSAND DOLLARS
($3,500,000). The DEBTOR represents and warrants to Doral that the product
of
this revolving credit line will be used exclusively for the purposes that appear
on the sheet attached to this agreement, which is incorporated herein as
Addendum
V
and
subject to the contents of Addendum
V.
SIXTH:
By
virtue of all the aforementioned in this agreement, DORAL commits to granting
to
the DEBTOR and the DEBTOR in turn to receiving from DORAL the financing or
loan
described below in this agreement, all under the arrangement of the
following
TERMS
AND CONDITIONS:
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6.1
|
Amount
of the revolving credit
line:
|
The
revolving credit line, (hereafter the “LOAN”) will be in the principal amount of
THREE MILLION FIVE HUNDRED THOUSAND DOLLARS ($3,500,000). Under the LOAN, the
DEBTOR may take the loans it requests, subject to the conditions of this
agreement and as long as the total balance of the principal of the debt under
the LOAN does not exceed the sum of THREE MILLION FIVE HUNDRED THOUSAND DOLLARS
($3,500,000).
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6.2
|
Debtor:
|
The
LOAN
will be granted by DORAL to the DEBTOR, that is, to the Puerto Rico corporation
XXXXX CARIBE, INC., (employer tax identification number
00-0000000).
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6.3
|
Interest:
|
Subject
to the provisions of section 3.10 of this agreement, the unpaid balance of
the
principal amount of the LOAN will accrue interest at a variable rate, equivalent
at all times to TWO POINT SEVENTY FIVE PERCENT (2.75%) (two hundred and seventy
five (275) basis points) over the London Interbank Offered Rate (LIBOR),
adjusted every ninety (90) days. Any change in the referenced interest rate
will
produce a change in the interest rate of the LOAN, which will be effective
on
the same day of the change of the referenced interest rate. After maturity
or in
the event of default in the payment of the principal or the interest of the
LOAN
within ten (10) natural days following its maturity, and as long as the default
remain uncured, the annual interest rate of the LOAN will increase by two
hundred (200) basis points. In the event of any other default by the DEBTOR
of
any of the terms and conditions of this agreement which is not resolved within
ten (10) natural days following its occurrence, and as long as the default
remain uncured, the annual interest rate of the LOAN will increase by two
hundred (200) basis points.
2
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6.4
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Maturity
and Form of Payment
|
The
interests on the funds owed under of the LOAN will be paid monthly, by monthly
installments due the last natural day of each month during the term of this
agreement, beginning on the last day of the month immediately following the
execution of this agreement, when the first payment of interest for the time
elapsed from the date of execution of this agreement until the last natural
day
of the month immediately following the execution of this agreement.
The
LOAN
will mature in twenty four (24) months commencing on the date of execution
of
this agreement. See section 4.10 of this agreement. The LOAN will be due,
therefore, on June fourteenth (14) two thousand seven (2007).
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6.5
|
Bank
Fee:
|
DORAL
will charge a non refundable bank fee in the amount of THIRTY FIVE THOUSAND
DOLLARS ($35,000). This commission will be included in the first disbursement
of
the LOAN, earned completely by DORAL at that moment and deducted and charged
by
DORAL from the product of the disbursement of the LOAN. Such fee will not be
refundable.
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6.6
|
Use
of Funds:
|
The
funds
product of the LOAN will be used by the DEBTOR only and exclusively for the
purposes that appear in the sheet attached to this agreement, and made a part
hereof as Addendum
IV
and
subject to the content of Addendum
IV.
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6.7
|
Penalty
for Late Payment and Increase in Interest Rate upon
Default:
|
The
DEBTOR will pay DORAL an amount equal to FIVE PERCENT (5%) for any installment
of principal and/or interests of the LOAN paid ten (10) natural days or more
after its maturity. In the event any default in the payment of any installment
of the principal or interests of the LOAN that continues ten (10) natural days
or more after its maturity, or any default by the DEBTOR under this agreement
or
any of the other documents subscribed or to be subscribed by the DEBTOR in
connection with this agreement, not cured within ten (10) natural days after
its
occurrence, and as long as such default remains uncured, the interest rate
of
the LOAN will increase by 200 basis points.
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6.8
|
Collateral
and Guarantee:
|
THE
LOAN
will have the following collateral and guarantees:
3
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a.
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Guaranteed
first lien in favor of DORAL and a first priority security interest
in
favor of DORAL over mortgage promissory note (hereafter the “MORTGAGE
PROMISSORY NOTE OF $2,025,000”) to the order of DORAL, issued by
GARROCHALES, for the principal amount of TWO MILLION TWENTY FIVE
THOUSAND
DOLLARS ($2,025,000), guaranteed with a first mortgage (hereafter
MORTGAGE
OF $2,025,000) over PROPERTY 1, constituted by deed number thirty
three
(33), granted in San Xxxx, Puerto Rico, the fourteenth (14) of June
of two
thousand five, (2005), before the notary public Xxxxxxxxx Xxxxx
Xxxxxxx.
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b.
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Guaranteed
first lien in favor of DORAL and a first priority security interest
in
favor of DORAL over mortgage promissory note (hereafter the “MORTGAGE
PROMISSORY NOTE OF $475,000”) to the order of DORAL, issued by
GARROCHALES, for the principal amount of FOUR HUNDRED SEVENTY FIVE
THOUSAND DOLLARS ($475,000), guaranteed with a first mortgage (hereafter
MORTGAGE OF $475,000) over PROPERTY 2, constituted by deed number
thirty
three (34), granted in San Xxxx, Puerto Rico, the fourteenth (14)
of June
of two thousand five, (2005), before the notary public Xxxxxxxxx
Xxxxx
Xxxxxxx.
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c.
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Guaranteed
first lien in favor of DORAL and a first priority security interest
in
favor of DORAL over mortgage promissory note (hereafter the “MORTGAGE
PROMISSORY NOTE OF $500,000”) to the order of DORAL, issued by
GARROCHALES, for the principal amount of FIVE HUNDRED FIVE THOUSAND
DOLLARS ($500,000), guaranteed with a first mortgage (hereafter MORTGAGE
OF $500,000) over PROPERTY 3, constituted by deed number three (3),
granted in San Xxxx, Puerto Rico, the twenty fifth (25) of January
of two
thousand two, (2002), before the notary public Xxxxxxx Xxxxxx
Fontán.
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d.
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Guaranteed
first lien in favor of DORAL and a first priority security interest
in
favor of DORAL over mortgage promissory note (hereafter the “MORTGAGE
PROMISSORY NOTE OF $450,000”) to the order of DORAL, issued by XXXXX, for
the principal amount of FOUR HUNDRED FIFTY THOUSAND DOLLARS ($450,000),
guaranteed with a first mortgage (hereafter MORTGAGE OF $450,000)
over
PROPERTY 4.
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e.
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Guaranteed
first lien in favor of DORAL and a first priority security interest
in
favor of DORAL over promissory note (hereafter the “PROMISSORY NOTE OF
$3,000,000”) to the order of the GUARANTORS (as this term is defined below
in this agreement), issued by the DEBTOR, for the principal amount
of TREE
MILLION DOLLARS ($3,000,000) the twenty third (23) day of May of
two
thousand five (2005), maturing on the first (1) of May of two thousand
ten
(2010). Copy of the PROMISORRY NOTE FOR $3,000,000 is annexed to
this
agreement, and made a part hereof as Addendum
VI.
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4
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f.
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Title
insurance policy in favor of DORAL, issued by a title insurance company
acceptable to DORAL, insuring the MORTGAGE OF $2,025,000 as a first
mortgage on PROPERTY 1 for a total principal amount of TWO MILLION
TWENTY
FIVE THOUSAND DOLLARS ($2,025,000).
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g.
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Title
insurance policy in favor of DORAL, issued by a title insurance company
acceptable to DORAL, insuring the MORTGAGE OF $475,000 as a first
mortgage
on PROPERTY 2 for a total principal amount of FOUR HUNDRED SEVENTY
FIVE
THOUSAND DOLLARS ($475,000).
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h.
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Title
insurance policy in favor of DORAL, issued by a title insurance company
acceptable to DORAL, insuring the MORTGAGE OF $500,000 as a first
mortgage
on PROPERTY 3 for a total principal amount of FIVE HUNDRED THOUSAND
DOLLARS ($500,000).
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i.
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Title
insurance policy in favor of DORAL, issued by a title insurance company
acceptable to DORAL, insuring the MORTGAGE OF $450,000 as a first
mortgage
on PROPERTY 4 for a total principal amount of FOUR HUNDRED FIFTY
THOUSAND
DOLLARS ($450,000).
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6.9
|
Due
Dates and Advance
Payment:
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The
LOAN
will mature in its entirety on June fourteen (14) two thousand seven (2007)
and
shall be payable as provided in section 6.4 of this agreement.
In
the
event of any prepayment for the total amount of the LOAN before its maturity
with the product of any refinancing (except for refinancing granted by DORAL
and/or entities affiliated to DORAL), the DEBTOR will be obligated to pay DORAL
a non refundable penalty equal to ONE POINT FIVE PERCENT (1.5%) annually on
the
unpaid balance of the LOAN at the moment of prepayment until the maturity of
the
LOAN. This penalty for prepayment will be paid by the DEBTOR to DORAL
simultaneously with the prepayment of the LOAN.
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6.10
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Changes
in Laws or Regulations Applicable to
Doral:
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In
the
event of an increase in cost of funds to Doral as a result of any change in
a
law, rule, or regulation that becomes effective after the date of the execution
of this agreement and which is applicable to DORAL, the interest rate of the
LOAN will increase after the date in which the law, rule or regulation becomes
effective. This increase in the interest rate of the LOAN will be only the
amount sufficient for DORAL to recover the increase in the cost of its funds
through the increased interest rate, in one part of said funds, equal at all
times to the unpaid balance of the LOAN’s principal.
5
| 6.11 |
Source
of Payment
|
The
DEBTOR contemplates paying the loan with funds provided by the following sources
or a combination of the same:
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a.
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A
refinancing of the LOAN on or before its maturity. The parties appearing
herein acknowledge, recognize and accept that neither DORAL nor its
related or affiliated entities have the moral or legal obligation
of any
kind to grant or disburse the aforementioned refinancing, as well
as that
the DEBTOR’s obligation to pay the LOAN upon maturity is in no way
conditioned to the approval, concession, or disbursement of said
refinancing.
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b.
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Other
funds of the DEBTOR or the GUARANTORS or any of
them.
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c.
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The
product of the sale of PROPERTY 1 or part(s) of the
same
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d.
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The
product of the sale of PROPERTY 2 or part(s) of the
same
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e.
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The
product of the sale of PROPERTY 3 or part(s) of the
same
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f.
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The
product of the sale of PROPERTY 4 or part(s) of the
same
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6.12
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Disbursement
of the Loan and Promissory
Note:
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DORAL
has
disbursed the LOAN in its entirety in a manner satisfactory to the DEBTOR,
simultaneously with the granting of this agreementt, with the deductions and/or
retentions described in Addendum
V
of this
agreement, if any, and the DEBTOR so acknowledges and accepts.
| 6.13 |
Promissory
Note:
|
The
funds
owed and to be owed under this LOAN have been evidenced by a promissory note
issued at this same date by the DEBTOR to the order DORAL, for the principal
amount of THREE MILLION FIVE HUNDRED THOUSAND DOLLARS ($3,500,000). A copy
of
said promissory note is attached as Addendum VI of this agreement and made
a
part hereof. DORAL acknowledges receipt of the original promissory note (the
“CASHIER’S NOTE”) by appearing in this agreement. In the grid attached to the
CASHIER’S NOTE, all disbursements and payments of the owed funds under the LOAN
will be annotated. DORAL is under no obligation to disburse funds to the DEBTOR
under the LOAN in the event of default by the DEBTOR with this agreement and/or
any other contracts granted by the DEBTOR in connection with this agreement
and/or transactions and/or business object of the same.
6
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6.14
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Representations
and Warranties of the
DEBTOR:
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To
induce
DORAL to grant the LOAN to the DEBTOR, the DEBTOR represents and warrants DORAL
the following:
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a.
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The
provisions of sections FIRST, SECOND, THIRD, FOURTH, and FIFTH of
this
agreement are correct and true and nothing in those sections is
misleading.
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b.
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The
DEBTOR has the legal capacity to take the LOAN, enter into this agreement,
subscribe and deliver the CASHIER’S NOTE, the PROMISSORY NOTE for
$3,000,000 and all the other documents, if any, in connection with
the
LOAN and/or the guarantees or collaterals of the same and subscribed
by
the DEBTOR.
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c.
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GARROCHALES
has the legal capacity to subscribe and deliver the MORTGATE PROMISSORY
NOTE for $2,025,000, the MORTGATE PROMISSORY NOTE for $475,000, the
MORTGATE PROMISSORY NOTE for $500,000, the MORTGAGE of $2,025,000,
the
MORTGAGE of $475,000, the MORTGAGE of $500,000, the PROMISSORY NOTE
for
$3,000,000 and all other documents, if any, in connection with the
LOAN
and/or the guarantees or collaterals of the same and subscribed by
GARROCHALES.
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d.
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MARGO
has the legal capacity to subscribe and deliver the MORTGATE PROMISSORY
NOTE for $450,000, the MORTGAGE of $450,000, and all other documents,
if
any, in connection with the LOAN and/or the guarantees or collaterals
of
the same and subscribed by XXXXX.
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e.
|
The
GUARANTORS have the legal capacity necessary to execute the documents
subscribed or to be subscribed by the GUARANTORS in connection with
the
loan, if any, to personally and jointly and severally solidarity
guarantee
the LOAN, and subscribe documents to guarantee the LOAN jointly and
severally.
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f.
|
Nothing
in this agreement or in any other document in connection with the
LOAN
and/or its collaterals or guarantees violates any provision of contract(s)
or agreement(s) that obligate or bind the DEBTOR or contained in
the
documents through which the DEBTOR was
created.
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g.
|
Nothing
in this agreement or in any other document in connection with the
LOAN
and/or its collaterals or guarantees violates any law(s), rule(s),
regulation(s), norm(s), sentence(s), decree(s) or similar instrument(s)
that obligate or bind the DEBTOR.
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7
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h.
|
The
DEBTOR is a corporation duly constituted and doing business and in
good
standing in accordance with the laws of Puerto Rico and its president
is
XXXXXXX XXXXXX XXXXXXX XXXXXX.
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i.
|
XXXXXXX
XXXXXX XXXXXXX XXXXXX is duly authorized by the Board of Directors
of the
DEBTOR to appear in this agreement in representation of the DEBTOR,
as
well as in all other documents granted or to be granted by the DEBTOR
in
connection with this LOAN.
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j.
|
MARGO
is a corporation duly constituted and doing business and in good
standing
in accordance with the laws of the state of Florida, United States
of
America.
|
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h.
|
GARROCHALES
is a corporation duly constituted and doing business and in good
standing
in accordance with the laws of Puerto
Rico.
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j.
|
MICHAEL
XXXXXX XXXXXXX XXXXXX is duly authorized by the Board of Directors
of
XXXXX to appear in representation of XXXXX in all documents entered
into
or to be entered into by XXXXX in connection with this
LOAN.
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l.
|
MICHAEL
XXXXXX XXXXXXX XXXXXX is duly authorized by the Board of Directors
of
GARROCHALES to appear in representation of GARROCHALES in all documents
entered into or to be entered into by GARROCHALES in connection with
this
LOAN.
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m.
|
This
agreement, the CASHIER’S NOTE, the PROMISSORY NOTE for $3,000,000 and
other documents, if any, subscribed by the DEBTOR in connection with
this
LOAN and/or its collaterals or guarantees, are valid and obligate
and bind
the DEBTOR.
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n.
|
The
MORTGAGE of $2,025,000, the MORTGAGE of $475,000, the MORTGAGE of
$500,000, the MORTGATE PROMISSORY NOTE for $2,025,000, the MORTGATE
PROMISSORY NOTE for $475,000, the MORTGATE PROMISSORY NOTE for $500,000,
the PROMISSORY NOTE for $3,000,000 and all other documents, if any,
subscribed by GARROCHALES in connection with the LOAN and/or the
collaterals or guarantees are valid and obligate and bind
GARROCHALES.
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o.
|
The
MORTGAGE of $450,000, the MORTGATE PROMISSORY NOTE for $450,000,
and all
other documents, if any, subscribed by XXXXX in connection with the
LOAN
and/or the collaterals or guarantees are valid and obligate and bind
XXXXX.
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8
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p.
|
There
is no litigation, suits, judicial actions, or claims or similar
proceedings pending against the DEBTOR, the GUARANTORS, XXXXX,
GARROCHALES, some or any of them, be it in the courts of justice
or
administrative agencies, or arbitration forums or anything similar,
which
either individually or in conjunction, will result in adverse material
change(s) in the business or operations or financial condition of
the
DEBTOR, the GUARANTORS, XXXXX, GARROCHALES, some or any of them and
there
is no threat of such litigation, suit, judicial action or claim or
similar
proceedings.
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q.
|
The
DEBTOR, nor the GUARANTORS, nor XXXXX nor GARROCHALES are insolvent
or
incapable of paying their respective debts on their respective
maturities.
|
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r.
|
There
is no bankruptcy, reorganization or similar proceedings filed by
or
against the DEBTOR, the GUARANTORS, XXXXX, GARROCHALES or some or
any of
them.
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s.
|
The
MORTGAGE of $2,025,000 has a rank of first mortgage and is not
subordinated to any other charge or mortgage lien. The MORTGAGE of
$475,000 has a rank of first mortgage and is not subordinate to any
other
charge or mortgage lien. The MORTGAGE of $500,000 has a rank of first
mortgage and is not subordinate to any other charge or mortgage lien.
The
MORTGAGE of $450,000 has a rank of first mortgage and is not subordinate
to any other charge or mortgage
lien.
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t.
|
All
territory taxes or property taxes corresponding to the Property (as
this
term is defined further on in this agreement) are current and no
arrears
are owed due to the same or for interests, charges, or penalties
relative
to such.
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u.
|
PROPERTY
1 and PROPERTY 2 were appraised together on the tenth (10) of February
of
two thousand five (2005) by the appraising firm of Xxxxxxx &
Associates, PCS in the sum of TWO MILLION FIVE HUNDRED THOUSAND DOLLARS
($2,500,000). PROPERTY 3 was appraised on the tenth (10) of February
of
two thousand five (2005) by the appraising firm of Xxxxxxx &
Associates, PCS in the sum of FIVE HUNDRED THOUSAND DOLLARS ($500,000).
PROPERTY 3 was appraised by an appraiser acceptable to DORAL at a
sum
acceptable to DORAL.
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v.
|
The
premiums of all the insurance policies mentioned in this agreement
have
been paid and said policies are fully valid and in
effect.
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w.
|
The
DEBTOR maintains its accounting books and files in Puerto
Rico.
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9
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x.
|
GARROCHALES
is the owner of the MORTGAGE PROMISSORY NOTE OF $2,025,000 and, other
than
in favor of DORAL, it has no lien, mortgage, or transfer of any kind
and
GARROCHALES is the absolute fee simple owner of PROPERTY 1. GARROCHALES
is
the owner of the MORTGAGE PROMISSORY NOTE OF $475,000 and, other
than in
favor of DORAL, it has no lien, mortgage, or transfer of any kind
and
GARROCHALES is the absolute fee simple owner of PROPERTY 2. GARROCHALES
is
the owner of the MORTGAGE PROMISSORY NOTE OF $500,000 and, other
than in
favor of DORAL, it has no lien, mortgage, or transfer of any kind
and
GARROCHALES is the absolute fee simple owner of PROPERTY
3.
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y.
|
MARGO
is the owner of the MORTGAGE PROMISSORY NOTE OF $450,000 and, other
than
in favor of DORAL, it has no lien, mortgage, or transfer of any kind
and
XXXXX is the absolute fee simple owner of PROPERTY
4.
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z.
|
The
pledges liens and the interests guaranteed in favor of DORAL as described
in sections 6.8(a), 6.8(b), 6.8(c), 6.8(d), and 6.8(c) are in first
degree
and are not junior or subordinate to charge, lien, or guaranteed
interest
of any kind, except for those mentioned in the aforementioned sections,
if
any.
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aa.
|
The
improvements, surface, and subsoil of PROPERTY 1, of PROPERTY 2,
of
PROPERTY 3, and of PROPERTY 4, and the improvements, surface, and
subsoil
of the other real estate properties belonging to the DEBTOR and/or
XXXXX
and/or GARROCHALES will be jointly called hereafter in this agreement,
the
PROPERTY. The PROPERTY is not contaminated with any kind of dangerous
substance. No kind of dangerous substance emanation has been provoked
on
the PROPERTY. After careful research and investigation by the DEBTOR,
the
DEBTOR represents, warrants, and assures that, according to the available
data, there has never been and there is no emanation of dangerous
substances of any kind on the PROPERTY. The PROPERTY is not the object
of
a lien, transaction, claim, complaint, liability or suit of any kind
(be
it federal, state, or municipal in character) relative to the Superfund
or
that has as an ends the cleaning, elimination, or remedy of any dangerous
substance that may be found on the PROPERTY, nor does there exist
a threat
or the probability that such a situation should arise. There are
no
asbestos on the PROPERTY. There is no subterranean storage tank on
the
PROPERTY. The PROPERTY is not subject to any liability relative to
the
Superfund due to cleaning, elimination, or remedy of dangerous substances
or of responsibility, cost, or payment resulting from the elimination
of
subterranean storage tanks or asbestos from the PROPERTY. The DEBTOR
will
indemnify, defend and compensate DORAL for fines, penalties, loss,
costs,
and expenses (among them, unlimited legal fees) that arise or result
as a
direct or indirect consequence of incorrectness or inexactitudes
of some
or any of the representations or warranties made by the DEBTOR to
DORAL or
of default by the DEBTOR in its obligations with DORAL relative to
dangerous substances on the PROPERTY. Be it clear that the PROPERTY
includes its surface, subsoil and anything found therein. Said indemnity
will continue beyond the execution of this agreement. The terms Dangerous
Substances and emanations as used herein, have the same meaning and
definitions indicated in sections fourteen (14), twenty-two (22)
and
twenty-three (23), respectively, of Title Forty-Two (42) United States
Code (U.S.C.) sections nine thousand six hundred and one (9601) and
subsequent ones, and in the laws of the Commonwealth of Puerto Rico,
with
the understanding that the term Dangerous Substance, as used in this
text,
covers Hazardous Wastes as defined in forty-two (42) U.S.C., section
six
thousand nine hundred three (6903), and petroleum, defined in forty-two
(42) U.S.C. six thousand nine hundred ninety one (6991). The term
Superfund, as used in this text means Comprehensive Environmental
Response, Compensation, and Liability Act, as amended, and any similar
law
promoted by the Commonwealth of Puerto Rico applicable to the Property
or
its subsoil, included without limitations, the laws of the Commonwealth
of
Puerto Rico, and all rules and regulations promoted, administrated
or
applied by any government organization or dependency with arrangements
with them. The term underground storage tank, as used here, has the
same
meaning and the same definition as those indicated in forty-two (42)
U.S.C., six thousand nine hundred ninety one
(6991).
|
10
|
bb.
|
The
DEBTOR is duly authorized and has the necessary legal capacity to
be owner
of its properties and to conduct business as it currently does and
has all
required licenses and permits to do so, if any be
required.
|
|
cc.
|
All
improvements and constructions that the DEBTOR or its contractors
and/or
principals and/or agents make to PROPERTY 1, PROPERTY 2, PROPERTY
3, or
PROPERTY 4, will be performed in accordance with its blueprints and
specifications with all the necessary endorsements, permits, and
approvals
from those government agencies with jurisdiction over them and all
laborers and employees who work in them will be covered by the
corresponding policies from the State Insurance Fund and Xxxxxxx’x
Insurance, if it applies, and the premiums of these policies will
be kept
current and up to date.
|
|
dd.
|
The
DEBTOR’s only stockholders are the GUARANTORS. MARGO’s only stockholder is
the DEBTOR. GARROCHALES has the same stockholders as the DEBTOR.
GARROCHALES’s only stockholder is the
DEBTOR.
|
| 6.15 |
Obligations
of the DEBTOR
|
To
induce
DORAL to grant the DEBTOR the LOAN, the DEBTOR promises the following as long
as
any amount of principal or interest is still owed by virtue of this
LOAN:
|
a.
|
Will
maintain or cause to maintain in full force and effect policies covering
the PROPERTY for fire, earthquake, hurricane, flood, vandalism, theft,
extended coverage, and builder’s risk, as applicable, as well as public
liability policies for injuries to the person or damage to the property
suffered or caused on the PROPERTY, issued by solvent insurance companies
acceptable to DORAL, for minimum coverage amounts acceptable to
DORAL.
|
11
|
b.
|
Will
include or cause that DORAL be included as additional insured in
the
policies mentioned in section 6.15(a) of this agreement relative
to
PROPERTY 1, PROPERTY 2, PROPERTY 3, or PROPERTY 4 along with the
DEBTOR as
their respective interest may
appear.
|
|
c.
|
Will
send or cause to be sent to DORAL complete copies of all insurance
policies mentioned in section 5.15(a) of this agreement, of all renewals
and evidence of punctual payment of their
premiums.
|
|
d.
|
Will
cause guaranteed interests that form part of the collateral or guarantee
of the LOAN be informed immediately to the State Department through
the
corresponding Financial Statements.
|
|
e.
|
Will
request that the insurance companies that issued or issue all the
aforementioned insurance policies notify DORAL of any changes, renewals
or
cancellations of said policies, as well as any arrears of delay in
the
payment of their premiums.
|
|
f.
|
The
DEBTOR will cause GARROCHALES not to sell or transfer PROPERTY 1,
PROPERTY
2, PROPERTY 3, or and that GARROCHALES and/or the DEBTOR do not sell
or
transfer the rest of the PROPERTY, except through bona fide transactions
with persons not related or affiliated to XXXXX and/or the DEBTOR
and
through the consideration of sufficient payment to reflect the fair
market
value of the property sold or
transferred.
|
|
g.
|
The
DEBTOR will ensure that XXXXX does not sell or transfer PROPERTY
3 except
through bona fide transactions with persons not related or affiliated
to
XXXXX and/or the DEBTOR and through the consideration of sufficient
payment to reflect the fair market value of the property sold or
transferred.
|
|
h.
|
The
DEBTOR will not sell or transfer the PROPERTY except through bona
fide
transactions with persons not related or affiliated to the DEBTOR
and
through the consideration of sufficient payment to reflect the fair
market
value of the property sold or
transferred.
|
|
i.
|
The
DEBTOR will cause GARROCHALES not to sell PROPERTY 1 without the
previous
written consent from DORAL. The DEBTOR will cause GARROCHALES not
to sell
PROPERTY 2 without the previous written consent from DORAL. The DEBTOR
will cause GARROCHALES not to sell PROPERTY 3 without the previous
written
consent from DORAL. The DEBTOR will cause XXXXX not to sell PROPERTY
4
without the previous written consent from
DORAL.
|
12
|
j.
|
Will
maintain or cause to maintain territory taxes or the corresponding
property taxes for the PROPERTY.
|
|
k.
|
Will
ensure that the PROPERTY and all its improvements be maintained in
good
state of conservation and
maintenance.
|
|
l.
|
In
general, all payments of debts will be kept current and up to date
as well
as in compliance with all obligations, including the necessary permits
and
licenses, if any, to be owner of its assets and to operate its
businesses.
|
|
m.
|
Will
comply with all laws, rules, regulations, norms, decrees, sentences,
resolutions, and similar instruments that may
apply.
|
|
n.
|
Will
pay the principal and interests of the LOAN on
time.
|
|
o.
|
Will
grant clarifying motions or other additional documents deemed necessary
so
that guaranteed liens and interests that are a part of the collateral
or
LOAN guarantee be valid and
binding.
|
|
p.
|
Will
not deposit or spill nor will permit the depositing or spilling of
Dangerous Substances on the
PROPERTY.
|
|
q.
|
Will
not transfer, mortgage, lien, or assign, except in favor of DORAL,
the
securities and assets that are a part of the collateral or guarantee
of
the LOAN. Will cause XXXXX not to transfer, mortgage, lien, or cede,
except in favor of DORAL, the securities and assets that are a part
of the
collateral or guarantee of the LOAN. Will cause GARROCHALES not to
transfer, mortgage, lien, or assign, except in favor of DORAL, the
securities and assets that are a part of the collateral or guarantee
of
the LOAN.
|
|
r.
|
Will
maintain a checking account with DORAL
BANK.
|
|
s.
|
Will
pay or ensure the immediate payment of all legal fees relative to
the LOAN
documents, as well as seals on any Financing Statement(s) in connection
with the LOAN submitted to the State Department of Puerto Rico, as
well as
expenses for the study of deed titles for PROPERTY 1, PROPERTY 2,
PROPERTY
3 and PROPERTY 4.
|
|
t.
|
Will
maintain files, documents, and accounting books in Puerto Rico and
will
submit to DORAL its financial statements every quarter, and if so
required
by DORAL, will make accessible its books to be examined and audited
by
DORAL.
|
13
|
u.
|
Will
send or ensure delivery to DORAL annually, the DEBTOR’s financial
statements. For financial statements of natural persons, these should
be
sent to DORAL on or before the fifteenth (15th
)
of April of each year. Likewise, those financial statements pertaining
to
legal entities should be sent to DORAL within ninety (90) natural
days
following the end of the fiscal year of the legal entity to whom
the
financial statements correspond. The financial statements will include
a
certification by the accountant in charge of their preparation indicating
that according to the accountant’s best knowledge and understanding, and
in his/her opinion, the DEBTOR is not defaulting or indefault with
its
obligations under this agreement and all other documents in connection
with this LOAN and/or its guarantees or
collaterals.
|
|
v.
|
Will
maintain or cause to be maintained all policies with the State Insurance
Fund and Chauffer’s Insurance mentioned in section 6.14(cc) of this
agreement are current and valid and that all premiums are
paid.
|
|
w.
|
Will
defend, indemnify and keep DORAL and its stockholders, directors,
officers, employees, agents, consultants, owners, and representatives
of
DORAL and ensure that the GUARANTORS, GARROCHALES, and XXXXX defend,
indemnify, and keep DORAL and its stockholders, directors, officers,
employees, agents, consultants, owners, and representatives free
from any
liability, loss, damage, cost, or expense suffered, incurred or threatened
as a result or alleged result, directly or indirectly, of any default
of
the DEBTOR’s part in its obligations under this agreement and the other
documents in connection with this LOAN and/or its guarantees and/or
collaterals, and/or as a result and/or alleged result of any notification,
complaint, claim, suit, litigation, rule, regulation, norm and/or
any
other legal requisite, including, without limiting the generality
and
amplitude of the previous, costs, legal expenses, legal and/or consulting
fees, costs for environmental clean-up, removal and disposal of waste
and/or substances and/or toxic, dangerous, contaminated materials,
contaminants and/or controlled substances, costs for repairs or mitigation
of damages to natural resources, fines, penalties, and/or injury
to
persons or personal property or real estate (immovables) and/or businesses
and/or business entities or any other legal or natural entity, including,
without limitation, all liabilities, responsibilities, claims, and
past,
present and/or future obligations resulting from or allegedly resulting
from, direct or indirectly, relative to, direct or indirectly, the
environmental condition of PROPERTY 1, PROPERTY 2, PROPERTY 3, PROPERTY
4
and/or other assets included in the PROPERTY, and/or subsoil and/or
the
existence or alleged existence of any environmental danger or risk
on the
PROPERTY and/or the subsoil and/or any discharge, alleged discharge
or
threat of any discharge of toxic, dangerous, contaminated, contaminants
and controlled substances of any kind in, on, or under the PROPERTY
and/or
its subsoil, at any time or moment, regardless if it is caused or
allegedly caused or not by DORAL and/or its stockholders, and/or
directors
and/or officers, and/or employees and/or consultants and/or directors
and/or owners and/or agents and/or representatives and/or within
and/or
under their control or any or some of
them.
|
14
|
x.
|
Will
maintain or cause GARROCHALES to maintain in effect at all times
a valid
insurance policy on the mortgage issued by a title insurance company
acceptable to DORAL, insuring the MORTGAGE OF $2,025,000 as a first
degree
mortgage lien on PROPERTY 1, subordinate only to the charges and
liens, if
any, mentioned in the deed through which the MORTGAGE OF $2,025,000
was
established.
|
|
y.
|
Will
maintain or cause GARROCHALES to maintain in effect at all times
a valid
insurance policy on the mortgage issued by a title insurance company
acceptable to DORAL, insuring the MORTGAGE OF $475,000 as a first
degree
mortgage lien on PROPERTY 2, subordinate only to the charges and
liens, if
any, mentioned in the deed through which the MORTGAGE OF $475,000
was
established.
|
|
z.
|
Will
maintain or cause GARROCHALES to maintain in effect at all times
a valid
insurance policy on the mortgage issued by a title insurance company
acceptable to DORAL, insuring the MORTGAGE OF $500,000 as a first
degree
mortgage lien on PROPERTY 3, subordinate only to the charges and
liens, if
any, mentioned in the deed through which the MORTGAGE OF $500,000
was
established.
|
|
aa.
|
Will
maintain or cause XXXXX to maintain in effect at all times a valid
insurance policy on the mortgage issued by a title insurance company
acceptable to DORAL, insuring the MORTGAGE OF $450,000 as a first
degree
mortgage lien on PROPERTY 4, subordinate only to the charges and
liens, if
any, mentioned in the deed through which the MORTGAGE OF $450,000
was
established.
|
|
bb.
|
On
or before the execution of this agreement, will obtain or cause
GARROCHALES to obtain a title insurance policy insuring the deed
in full
ownership of PROPERTY 1 for a sum no less that TWO MILLION TWENTY
FIVE
THOUSAND DOLLARS ($2,025,000), issued by a title insurance company
acceptable to DORAL.
|
|
cc.
|
On
or before the executing of this agreement, will obtain or cause
GARROCHALES to obtain a title policy insuring the deed in full ownership
of PROPERTY 2 for a sum no less that FOUR HUNDRES SEVENTY FIVE THOUSAND
DOLLARS ($475,000), issued by a title insurance company acceptable
to
DORAL.
|
15
|
cc.
|
On
or before the executing of this agreement, will obtain or cause
GARROCHALES to obtain a title policy insuring the deed in full ownership
of PROPERTY 3 for a sum no less that FIVE HUNDRED THOUSAND DOLLARS
($500,000), issued by a title insurance company acceptable to
DORAL.
|
|
dd.
|
On
or before the execution of this agreement, will obtain or cause XXXXX
to
obtain a title policy insuring the deed in full ownership of PROPERTY
4
for a sum no less that FOUR HUNDRED FIFTY THOUSAND DOLLARS ($450,000),
issued by a title insurance company acceptable to
DORAL.
|
|
6.16
|
Default:
|
DORAL
may, in its sole option and discretion, accelerate the maturity of the LOAN,
and/or proceed to collect it through judicial or extra judicial means, and/or
execute its liens on the collaterals or guarantees, and/or execute the MORTGAGE
OF $2,025,000, the MORTGAGE OF $475,000, the MORTGAGE OF $500,000, and/or the
MORTGAGE OF $450,000 if any of the following events or omissions should occur,
all of which will be considered noncompliance on the DEBTOR’s part when they are
notified by DORAL to the DEBTOR and thirty (30) calendar days have elapsed
commencing the date of notification:
|
a.
|
Non
payment of any of the installments of interest or principal of the
LOAN
within thirty (30) natural days immediately following their respective
maturities.
|
|
b.
|
Noncompliance
by the DEBTOR of any of the terms and conditions of the LOAN and/or
any
other obligation it may have with
DORAL.
|
|
c.
|
The
commencement by or against the DEBTOR of any voluntary or involuntary
proceeding under the Bankruptcy Law of the United States of America
or any
similar law to statute.
|
|
d.
|
Insolvency
of the DEBTOR or the DEBTOR’s incapacity to comply punctually with its
obligations or pay its debts on
time.
|
|
e.
|
Presence
on the PROPERTY of Dangerous
Substances.
|
|
f.
|
Failure
to timely pay territory taxes on the PROPERTY, including without
limitation, PROPERTY 1, PROPERTY 2, PROPERTY 3, and PROPERTY
4
|
16
|
g.
|
Failure
to timely pay the aforementioned premiums or insurance policies or
the
cancellation of said policies or any one of them without its immediate
substitution with a similar policy.
|
|
h.
|
If
any representation by the DEBTOR in this agreement or the LOAN application
were intentionally false, materially incomplete or conducive to
error.
|
|
i.
|
The
future assignment, transfer, sale, or establishment of a lien or
liens on
PROPERTY 1, PROPERTY 2, PROPERTY 3, and PROPERTY 4 or on any or some
of
the interests of the DEBTOR and/or XXXXX on the securities, instruments,
or assets that constitute the collateral or guarantee of the LOAN,
except
when in favor of DORAL.
|
|
j.
|
The
sale of PROPERTY 1 without written consent of DORAL. The sale of
PROPERTY
2 without the prior written consent of DORAL. The sale of PROPERTY
3
without the prior written consent of DORAL. The sale of PROPERTY
4 without
the prior written consent of DORAL.
|
|
k.
|
The
appointment of an executor, judicial administrator, receiver or similar
officer to take charge of any or some of the PROPERTY or of any or
part of
the assets or businesses of the DEBTOR, and/or the GUARANTORS and/or
XXXXX
and/or GARROCHALES, if the same does not become null within the sixty
(60)
days immediately following the
appointment.
|
|
l.
|
If
any sentence or arbitration decision or an order from any litigation,
administrative proceeding or arbitration is issued and becomes firm
and
final against XXXXX and/or against GARROCHALES, for an amount of
ONE
HUNDRED THOUSAND DOLLARS ($100,000) or more and the same is not satisfied
or bonded within sixty (60) days following the date issue date, or
if any
creditor takes possession of any property or properties from the
DEBTOR
and/or GUARANTORS and/or XXXXX and/or GARROCHALES and said possession
is
not terminated, be it by bonding the debt or a claim or desist or
a
dismissal or a termination to the claim, within sixty (60) days following
the initial taking of possession.
|
|
m.
|
If
the DEBTOR is dissolved or if the DEBTOR is no longer under the direct
or
indirect control of the GUARANTORS. If XXXXX is dissolved or is no
longer
under the direct or indirect control of the GUARANTORS. If GARROCHALES
is
dissolved or is no longer under the direct or indirect control of
the
GUARANTORS.
|
17
|
n.
|
If
the DEBTOR is dissolved or merges with any entity, or if the DEBTOR’s
stock or the GUARANTOR’s interests in the DEBTOR are mortgaged, liened,
transferred, traded or assigned, except to entities controlled by
the
GUARANTORS or any or some of them, without the written consent of
DORAL.
If XXXXX is dissolved or merges with any entity, or if MARGO’s stock or
the DEBTOR’s interests in XXXXX are mortgaged, liened, transferred, traded
or ceded, except to entities controlled by the DEBTOR and/or the
GUARANTORS or any or some of them, without the written consent of
DORAL.
If GARROCHALES is dissolved or merges with any entity, or if GARROCHALES’
stock or the GUARANTORS’ interests in the DEBTOR are mortgaged, liened,
transferred, traded or ceded, except to entities controlled by the
DEBTOR
and/or the GUARANTORS or any or some of them, without the written
consent
of DORAL.
|
|
o.
|
If
the DEBTOR does not obtain the title insurance policies describe
in this
agreement or if during the term of the LOAN any of these policies
ceases
to be in full force and effect.
|
SEVENTH:
This
agreement may not be assigned by the DEBTOR without the previous written consent
of DORAL and DORAL is under no obligation to give this consent. Likewise, DORAL
may freely assign this agreement to any person or entity and DORAL may freely
sell the LOAN and/or one or more participations of the same to any entity.
Subject to the above, this agreement will be in force and in effect between
the
parties and their inheritors, successors, trustees, and
cessionaries.
EIGHTH:
The
notifications between the parties under this agreement will be by certified
mail
with acknowledgement of receipt, with pre-paid postage, or by messenger with
acknowledgment of receipt, with a copy by fax to the following addresses and
fax
numbers of the parties or to those that the parties notify in the
future:
To
DORAL:
Doral
Bank
Suite
800, Doral Bank Plaza
X.
X.
Xxxxxxxxx Ave. #1159
Xxxxxx
Xxxxx
Xxx
Xxxx,
Xxxxxx Xxxx 00000
|
Attention:
|
Mr.
Xxxxxxx Xxxxxxxxx Xxxxxxx
|
|
Executive
Vice President
|
To
the DEBTOR:
XXXXX
CARIBE, INC.
Call
Box
1370
Dorado,
P.R. 00646-1370
|
Attention:
|
Xx.
Xxxxxxx Xxxxxx Xxxxxxx Xxxxxx
|
|
President
|
NINTH:
This
agreement will be interpreted in accordance with the laws of Puerto Rico and
will be governed by the same.
18
TENTH:
In the
event any litigation arises relative to this agreement, the LOAN or other
documents relative to it, the parties will submit to the jurisdiction of the
General Court of Justice of Puerto Rico.
ELEVENTH:
Should
DORAL waive any or some of its rights under this agreement and the other
documents in connection with the LOAN or its guarantees or collaterals does
not
imply nor should be interpreted as DORAL’s waiver of the rest of its rights
under this agreement and will apply only and exclusively to the occasion on
which said renunciation is made and to no other occasions.
TWELVETH:
The
titles and number and section letters, sections, paragraphs, or parts of this
agreement are inserted only to facilitate its reading and in no way affect
the
substance content of the same.
THIRTEENTH:
In this
agreement, the feminine, the masculine and the neutral are used indistinctively,
unless the text specifically suggests the contrary. The same occurs with plurals
and singulars.
FOURTEENTH:
It is
the parties’ intention that all the clauses, terms and conditions present in the
contract be obligatory, valid and binding as written. Nevertheless, if a court
with jurisdiction on the subject should resolve in final and firm manner that
a
part of section of this agreement is not valid the way it is written for being
too vague or too comprehensive, then the parties agree that said clause, section
or part be valid and binding only to the maximum possible as determined by
the
court. On the other hand, if any clause, part or section of this agreement
result illicit or illegal according to a firm and final determination of some
court with jurisdiction, then the same shall be held as null and the rest of
the
contract will remain in full force and effect.
FIFTEENTH:
This
agreement may be modified or amended only by a written document signed by all
parties here present.
SIXTEENTH:
The
DEBTOR authorizes DORAL to pay the legal fees incurred by the DEBTOR in the
preparation and closing of the LOAN and all the documents relative to the same
and all other expenses relative to the closing of this LOAN, as well as the
commission of the LOAN, directly to the offices of Xxxxxxxxx Xxxxx Xxxxxxx,
Esquire.
19
IN
WITNESS WHEREOF, the parties grant and subscribe this agreement, as they agree
it reflects total, complete, faithful and exactly what they have agreed, at
the
place and time indicated in the heading of this document.
|
DORAL
BANK
|
XXXXX
CARIBE, INC.
|
||
|
By:
|
/s/
Xxxxxxx Xxxxxxxxx
Xxxxxxx
|
By:
|
/s/
Xxxxxxx Xxxxxx
Xxxxxxx
|
|
XXXXXXX
XXXXXXXXX
|
XXXXXXX
XXXXXX XXXXXXX
|
||
|
XXXXXXX
|
XXXXXX
|
||
|
Executive
Vice President
|
President
|
||
Affidavit
Number: 4091
Acknowledged
and signed before me by Xxxxxxx Xxxxxxxxx Xxxxxxx, of legal age, banker, married
and resident of Guaynabo, Puerto Rico, in his capacity as Executive Vice
President of Doral Bank, and by Xxxxxxx Xxxxxx Xxxxxxx Xxxxxx, as President
of
Xxxxx Caribe, Inc., of legal age, proprietor, married and resident of Dorado,
Puerto Rico, both of whom I know personally. In San Xxxx, Puerto Rico, on the
fourteenth (14th)
of June
of two thousand five (2005).
[SEAL]
|
/s/Xxxxxxxxx
Xxxxx Xxxxxxx
|
|
|
Notary
Public
|
20
Addendum
I
“LOT
‘A” - RUSTIC: Track
of
land with space for SIXTY FOUR CUERDAS (64CDAS.), located in Barrio Garrochales
of Arecibo. On the North adjacent to State Road Number Six Hundred Eighty Two
(682); on the South with the primary farm from which it is segregated and in
one
hundred and nine point one hundred and eighty meters (109.180m.) with Lot One
B
(1B), to be segregated from the primary farm; on the East, with land currently
belonging to Xxxxxx Xxxxxx Xxxx, Xxxxxxx Houre, and Xxxxxxx Xxxx; and on the
West, with land currently belonging to Xxxxxxx Xxxxxxxxxx, the succession of
Xxxxxxx Xxxxx and with land belonging to Pelegrín Terraza.” Hereafter “PROPERTY
1.”
PROPERTY
1 is registered in folio two hundred and seventy (270) of volume four hundred
forty five (445) of the First (1st)
Section
of Arecibo of the Puerto Rico Property Registry, farm number seventeen thousand
nine hundred fifty two (17,952).
21
Addendum
II
“LOT
‘C’ - RUSTIC: Located
in Barrio Garrochales of Arecibo, comprised of FOURTEEN POINT SEVENTY FIVE
CUERDAS (14.75CDAS.), equal to five (5) hectares, seventy nine (79) areas and
sixty seven (67) “centarias.” It has one (1) single level wood house with a zinc
roof. On the North, adjacent to State Road Six Hundred Eighty Two (682); on
the
East with lands owned by Xxxxxx Xxxxxx; on the South, with lands owned by Cidra
Farms Incorporated; and on the West with Fiesta Farms Incorporated.” Hereafter
“PROPERTY 2”.
PROPERTY
2 is registered in folio two hundred twenty two (222) of volume two hundred
eighty five (285) of the First (1st)
Section
of Arecibo of the Puerto Rico Property Registry, farm number twelve thousand
seven hundred ninety (112,790).
22
Addendum
III
“LOT
‘B’ - RUSTIC:
Farm
located in Barrio Garrochales of Arecibo, comprised of THIRTY POINT FIFTY ONE
CUERDAS (30.51CDAS.) equivalent to eleven (11) hectares, ninety nine (99) areas
and sixteen (16) “centareas” of land. On the North adjacent to State Road Six
Hundred Eighty Two (682) which goes from Arecibo to Barrio Garrochales and
lands
belonging to Xxxxxxx Xxxxxxxx; on the South with lands belonging to Xxxxx
Xxxxxxxx; on the East with lands belonging to the succession of Xxxxxxx Xxxxxxx
and Xxxxxxx Xxxxxxxx; and on the West with lands belonging to Xxxxxx Xxxxxx.”
Hereafter “PROPERTY 3”.
PROPERTY
3 is registered in folio two hundred ninety (290) of volume four hundred eighty
eight (488) of the First (1st)
Section
of Arecibo of the Puerto Rico Property Registry.
23
Addendum
IV
EXHIBIT
A
DESCRIPTION
OF REAL PROPERTY
All
the
certain tract or parcel of land situate, lying and in the 32nd
G.M.
District, of Charlton County, Georgia, containing 66.06 acres, more or l4ess,
known locally as Grantor’s Georgia & Florida Investment “Novelty” Tract, and
being more particularly described as follows: Beginning at an existing concrete
monument located on the western right of way line of the 200 foot right of
way
of the CSX Railroad, said concrete monument being located 1,264 feet from
Milepost #603, and running thence along said right of way South 14 degrees
39
minutes 10 seconds East a distance of 402.52 feet to a point; continuing
thence
along said right of way line an are distance of 1,918.78 feet and a chord
distance of 1,916.63 feet to an iron pin; running thence North 89 degrees
28
minutes 30 seconds East a distance of 350.15 feet to an iron pin; running
thence
North 89 degrees 12 minutes 45 seconds West a distance of 1,287.64 feet to
a
concrete monument; running thence North 61 degrees 57 minutes 15 seconds
West a
distance of 658.78 feet to a point; running thence North 18 degrees 39 minutes
05 seconds East a distance of 1,115.12 feet to a concrete monument; running
thence North 71 degrees 01 minutes 15 seconds West a distance of 101.26 feet
to
a concrete monument; running thence North 71 degrees 01 minutes 15 seconds
West
a distance of 101.26 feet to a point; running thence North 12 degrees 33
minutes
10 seconds East a distance of 402.04 feet to an existing concrete monument;
running thence North 83 degrees 07 minutes 55 seconds East a distance of
528.32
feet to a concrete monument; running thence North 83 degrees 13 minutes 00
seconds East a distance of 650.21 feet to an existing concrete monument located
in the eastern right of way line of the 200 foot right of way of CSX Railroad,
which is the Point of Beginning, all as shown upon a map and plat prepared
under
the direction of and certified by Xxxxxxx Xxxxxx, Georgia Registered Land
Surveyor No. 1882, under date of July 27, 2000, and recorded in Plat Book
F,
Page 5, Charlton County, Georgia records, and reference to which is hereby
made
for a more full and complete description.
The
above-described tract being a portion of the property conveyed to Sustainable
forests, L.L.C. by deed from Union Camp Corporation, dated June 16, 1999,
and
recorded in Deed Book 00, Xxxx 000, Xxxxxxxx Xxxxxx, Xxxxxxx records, and
further conveyed to SP Forests L.L.C. by deed from Sustainable Forests L.L.C.,
dated November 20, 2000 and recorded in Deed Book 50, Page 509-512 in said
Charlton County, Georgia records.
AND
All
that
tract or parcel of land lying and being in the 32nd
G.M.
district of Charlton County, Georgia, and lying within the corporate city
limits
of Folkston, Georgia, containing eleven (11) acres, more or less, and being
bounded as follows: bounded on the north and west by lands of X.X. Xxxxxx,
on
the east by the right-of-way of CSX Transportation, and on the southwest
by
lands formerly belonging to the Estate of Xxxxx X. Xxxxxxx, lands of the
Georgia-Florida Investment Company, and on the southeast by property of Xxx
Xxxxxx; said tract known as the “Old Novelty Mill Site,” but recently known as
the “Xxxxxx Mill Site Tract;” also, a strip of land located in the said
32nd
G.M.
District of Charlton County, Georgia, being 125 feet in width more particularly
described as follows: Begin at the point which is the southwest corner of
the
above-described eleven (11) acre tract, more or less, and from said southwest
corner proceed in a westerly direction to a point on the right-of-way of
State
Highway Number 23, a wire fence being the line, then proceed in a northerly
direction along the right-of-way of said State Highway Number 23 a distance
of
125 feet to a stake, thence proceed in an easterly direction to a point on
the
western boundary line of the above-described eleven (11) acre tract, more
or
less, then proceed along said western line of the said eleven (11) acre tract
a
distance of 125 feet back to the said point of beginning, said tract being
a
rectangular shaped tract of land 125 feet in width and bounded as follows:
on
the north by lands of X.X. Xxxxxx, east by the said “Old Novelty Mill Site,” but
recently known as the “Xxxxxx Mill Site,” on the south by lands formerly owned
by the Estate of Xxxxx X. Xxxxxxx and lands of Xxxxx Xxxxxx, and on the west
by
the right-of-way of State Highway Number 23; said strip of land 125 feet
in
width being subject to a right-of-way Deed to the City of Folkston, as recorded
with the land records of the Clerk for the Charlton County Superior Court
in
Folkston, Georgia in Deed Book 12, Page 186, wherein the southerly 50 feet
of
the said strip has been conveyed for street purposes. Reference is made to
the
aforesaid Deed for description purposes.
A-1
All
that
tract or parcel of Land lying and being in-the 32nd
G.M.
District Charlton County, Georgia, and lying within the corporate city limits
of
Folkston, Georgia, more particularly described as follows: Begin at the point
which is the intersection of the northern boundary of the right-of-way-of
Easy
Street and the eastern boundary of the right-of-way of Georgia Highway 121
and
proceed from such point south 75 degrees 43 minutes 15 seconds east a distance
of 750.38 feet to a point; thence proceed north 06 degrees 48 minutes 45
seconds
west a distance of 540.80 feet to a point; thence proceed south 76 degrees
26
minutes 57 seconds west a distance of 611.90 feet to a point along the eastern
boundary of the right-of-way of Georgia Highway 12l,thence proceed south
18
degrees 17 minutes 36 seconds west along the said eastern boundary of the
right-of-way of Georgia Highway 121 a distance of 420.76 feet back to the
said
Point of Beginning; said tract is bounded as follows: on the north by lands
of
X.X. Xxxxxx; on the east by the Xxxxxx Lumber Company; on the south by Easy
Street; and on the west by Xxxxxxx Xxxxxxx 000.
All
that
tract or parcel of land lying and being in the 32nd
G.M.
District of Charlton County, Georgia and lying within the corporate city
limits
of Folkston, Georgia, more particularly described with reference to that
certain
plat prepared by Xxxxxx X. Xxxxxxxx, Georgia Registered Land surveyor, dated
September 11, 1972 and recorded with the land records with the Clerk for
the
Charlton County Superior Court in Folkston, Georgia in Plat Book B, Page
233,
begin at a concrete monument located by referenced in feet to the plane
coordinates of the Georgia Coordinate System, east zone, at Y (Lat) 299,193.93
and X (Dep) 549,686.73 and running from said point south 75 degrees 02 minutes
12 seconds east a distance of 472.66 feet to a point; thence proceed south
28
degrees 33 minutes 05 seconds east a distance of 243.73 feet to a point;
thence
proceed south 59 degrees 24 minutes 45 seconds west a distance of 220.59
feet to
a point; thence proceed south 08 degrees 27 minutes 54 seconds west a distance
of 516.66 feet to a point; thence proceed. south 83 degrees 02 minuses 39
seconds west a distance of 528.30 feet to a point; thence proceed north 12
degrees 27 minutes 4l seconds east a distance of 195.75 feet to a point;
thence
proceed to a point; thence proceed north 11 degrees 52 minutes 27 seconds
east a
distance of 850.45 feet back to the said point of beginning; said tract or
parcel containing 11.05 acres, more or less, according to said plat, said
tract
or parcel formerly being a point of Union Camp’s “Georgia-Florida Tact.”
Reference is. made to the aforesaid plat for descriptive and all other legal
purposes.
AND
All
that
tract or parcel of land lying and being in the 32ntd G.M. District of Charlton
County, Gerorgia, containing 4 acres, more or less, and bounded as follows:
on
the east by the CSX Transportation Company right-of-way, on the north by
the
land of Xxxxxxx X. Xxxxxxxx, Inc. and on the south and west by lands of Union
Camp Corporation.
All
that
tract or parcel of land lying and being in the 32nd
G.M.
District of Charlton County, Georgia, and more particularly described as
a tract
of land containing 3 acres, more or less, and bounded on the west, north
and
east by lands of Xxxxxx Lumber and Timber Company, Inc. and bounded on the
south
by lands of Union Camp Corporation, being the tract or parcel of land purchased
by X.X. Xxxxx from Xxx. Xxxxxx Xxxxxxxx, by Deed recorded with the land records
of the Clerk for the Charlton County Superior Court in Folkston, Georgia
in Deed
Book 12, Page 242. Reference is made to the aforesaid Deed for description
purposes.
Reference
to private land ownership are as they presently exist or were formerly
held.
The
above-described tracts of land are identical to the tracts of land conveyed
by
Warranty Deed dated December 1, 1980 by Xxxxxx Lumber and Timber Company
to
Union Camp Corporation, as recorded with the said land records in Deed Book
26,
Pages 513-516; being the identical tracts of property conveyed by Warranty
Deed
dated November 19, 1986 by Union Camp Corporation to Jefferson Home Builders,
Inc., said Deed recorded with the said lands records in Deed Book 32, Pages
555-558; and being identical to the tracts of land conveyed by Warranty Deed
dated May 25, 1993 by Jefferson Home Builders, Inc., to Xxxxx X. Xxxxxxxx,
Xx.
and Xxxxxxx X. Xxxxxxxx, said Deed being recorded with the said land records
in
Deed Book 40, Pages 334-337.
A-2
LESS
AND
EXCEPT THE FOLLOWING:
ALL
THAT
TRACT OR PARCEL OF LAND LAYING AND BEING IN THE 32ND
GEORGIA
MILITIA DISTRICT, CHARLTON COUNTY, GEORGIA, IS MORE FULLY DESCRIBED
BELOW.
THE
POINT
OF COMMENCEMENT (P.O.C.) IS A CONCRETE MONUMENT, GEORGIA EAST ZONE COORDINATES
SYSTEM Y (LAT) 299,356.353 - X (DEP) 549,041.370, ON THE EASTERLY (E-LY)
RIGHT-OF-WAY (R/W) XX XXXXXXX XXXXX XXXXXXXX XX. 000 & NO. 23, A 100’ (FT)
R/W. THENCE, PROCEED ALONG THE E-LY R/W OR GEORGIA XXXXX XXXx Xx. 000 & Xx.
00, N18° 11’ 27” E A DISTANCE OF 82.40’ (FT.) (L1) TO A ¾” PIPE FOUND. THENCE
CONTINUE ALONG THE E-LY R/W OF GEORGIA STATE HWYS No. 121 & No. 23, N18° 29’
21” E A DISTANCE OF 623.61’ (FT.) TO A 5/8” REBAR FOUND. THENCE PROCEED S84° 56’
40’ E A DISTANCE OF 952.87’ (FT.) TO A CONCRETE MONUMENT FOUND IN THE W-LY R/W
OF C.S.X. RAILROAD (FORMERLY A.C.L. RAILROAD), A 200’ (FT.) R/W. THENCE PROCEED
ALONG THE WSTERLY (W-LY) R/W OF C.S.X. XXXXXXXX X/X, X00x 39’ 08” E A DISTANCE
FO 380.49’ (FT) TO A 1/2” REBAR SET, THIS ALSO BEING THE POINT OF BEGINNING
(P.O.B.).
FROM
THE
P.O.B. CONTINUE ALONG THE W-LY R/W OF C.S.X. RAILROAD, A 200’ (FT.) R/W, S14°
39’ 08” E A DISTANCE OF 945.00’ (FT.) TO A 1/2” REBAR SET. THENCE PROCEED ALONG
THE SOUTHERLY (S-LY) PROPERTY LINE OF SUBJECT PROPERTY S75°20’52”W A DISTANCE OF
375.00’ (FT.) TO A 1/2” REBAR SET. THENCE PROCEED ALONG THE W-FLY PROPERTY LINE
OF SUBJECT PROPERTY N14°39’06”W A DISTANCE OF 945.00’ (FT.) TO A 1/2” REBAR SET.
THENCE PROCEED ALONG THE NORTHERLY (N-LY) PROPERTY LINE OF SUBJECT PROPERTY
N75°20’52”E A DISTANCE OF 375.00’ (FT.) TO A ½” REBAR SET, ALSO BEING THE POINT
OF BEGINNING.
A-3
Addendum
V
LOAN
AGREEMENT BETWEEN
DORAL
BANK AND
XXXXX
FARMS, INC.
JUNE
14, 2005
Use
of Funds Product of the Loan:
|
Use
and Disbursement Form by Doral
|
Amount
|
||||
|
1.
|
Bank
Fee
|
$
|
35,000
|
||
|
2.
|
Recordation
rights, seals for original and certified first copy of mortgage deed
for
the principal sum of $2,025,000 to be paid directly by DORAL to the
account to and charged to the DEBTOR
|
$
|
11,713.50
|
||
|
3.
|
Recordation
rights, seals for original and certified first copy of mortgage deed
for
the principal sum of $2,025,000 to be paid directly by DORAL to the
account of and charged to the DEBTOR
|
$
|
2,273.50
|
||
|
4.
|
Seals
on affidavits and receipts on Financial Statement to be paid directly
by
DORAL to the account of and charged to the DEBTOR
|
$
|
100.00
|
||
|
5.
|
Premiums
for title deed insurance policy for the sum of $2,025,000 and mortgage
deed for the sum of $2,025,000 to be paid directly by DORAL to the
account
of and charged to the DEBTOR
|
$
|
5,507.00
|
||
|
6.
|
Premiums
for title insurance policy for the sum of $475,000 and mortgage deed
for
the sum of $475,000 to be paid directly by DORAL to the account of
and
charged to the DEBTOR
|
$
|
1,543.00
|
||
|
7.
|
Legal
fees relative to the granting of the MORTGAGE OF $2,025,000, the
MORTGAGE
OF $475,000, this contract and other documents to be paid directly
by
DORAL to the account of and charged to the DEBTOR
|
$
|
16,000
|
||
|
8.
|
Municipal
Income Collection Center for PROPERTY 1
|
$
|
10,411.94
|
||
|
9.
|
San
Xxxx Abstract Company (escrow for Municipal Income Collection Center
for
PROPERTY 2)
|
|
$
|
6,500.00
|
|
|
|
|||||
|
10.
|
Scotiabank
of Puerto Rico (cancellation balance of several loans as of June
15,
2005
|
$
|
2,810,911.97
|
||
|
11.
|
Working
capital for DEBTOR
|
$
|
599,289.09
|
||
|
12.
|
TOTAL
AMOUNT OF LOAN
|
$
|
3,500,000.00
|
24
Addendum
VI
PROMISSORY
NOTE
PRINCIPAL:
$3,500,000
MATURITY: Interests
on the total unpaid balance of the principal in twenty-three (23) monthly
installments beginning the last day of the month immediately following the
granting of this Promissory Note, when the first payment is made on interests
for the period transpired as of the granting of this Promissory Note until
the
last natural day of the month immediately following this Promissory Note plus
one final installment due twenty four (24) months as of the granting of this
Promissory Note for the total sum of the unpaid balance of the principal plus
interests accrued until then.
FOR
VALUE RECEIVED:
upon
becoming due, as of twenty four (24) months of the granting of this Promissory
Note, we will pay jointly and severally to the order of DORAL BANK, the
principal sum of THREE MILLION FIVE HUNDRED THOUSAND DOLLARS ($3,500,000),
additionally binding ourselves to pay monthly interests on the unpaid balance
of
said principal at a fluctuating rate, equal to at all times to TWO POINT SEVENTY
FIVE PERCENT (2.75%) over the London Interbank Offered Rate, adjusted every
ninety days (90) as of this date until the total, complete and definitive
payment of all that is owed by virtue of this Promissory Note.
We
jointly and severally commit to paying interests on the total unpaid balance
of
this Promissory Note in twenty three (23) installments, beginning the last
day
of the month immediately following the granting of this Promissory Note, when
the first payment will be made of interests for the period transpired as of
the
day of the granting of this Promissory Note until the last natural day of the
month immediately following the day of the granting of this Promissory Note;
plus one last installment twenty four (24) months after the granting of this
Promissory Note, for the total amount of the unpaid balance of the principal,
that is, THREE MILLION FIVE HUNDRED THOUSAND DOLLARS ($3,500,000), plus
interests then accrued by virtue of the same. All monthly installments will
first be applied to accrued interests, and the rest, if any, to decreasing
the
principal. The same will occur with any advance payment. We jointly and
severally commit to pay a 5% penalty or charge on any payment we make ten days
after the due date. Any delay of thirty (30) days or more in the payment of
any
installment will result in the advanced and immediate payment of this Promissory
Note, at the owner or holder’s option by endorsement. In the event of non
payment that persists ten (10) or more natural days after the due date of any
installment under this Promissory Note or any other noncompliance by the
subscriber under this Loan Contract granted on this same date by the subscriber
and DORAL BANK, not remedied within the ten (10) natural days following the
occurrence, and while said noncompliance persists, the annual interest rate
will
increase by 200 base points.
We
renounce all right to presentation for payment, protest, notification of
nonpayment and protest, and consent to the possible extension of the
installments of this Promissory Note without notice of prorating, as per the
option of the creditor of this Promissory Note. In the event a judicial
complaint be necessary for the payment of the this obligation, we submit
specifically to the jurisdiction and competency of the Court of Justice of
Puerto Rico, San Xxxx Tribunal and we commit to paying a sum equal to TEN
PERCENT (10%) of the original principal sum of this Promissory Note for costs,
expenses, disbursements, and legal fees that the owner or holder by endorsement
of this Note uses in the event of a complaint for payment of the debt, whether
or not the complaint be made through the legal system, and even when the
proceedings be followed by our rebellion, or in the event of bankruptcy by
the
subscribers, or any of them, under the dispositions of the Federal Bankruptcy
Code or other similar statute.
All
partial payments, if any, towards the account of this Promissory Note will
be
applied, firstly, to any penalty for prepayment, secondly and as far as the
amount permits, to the interests accrued up to the date of the partial payment,
and thirdly and as far as the amount permits, to decreasing the principal sum
of
the Note.
This
Promissory Note evidences loans taken and to be taken by virtue of a revolving
credit line granted by DORAL BANK to Xxxxx Caribe, Inc. today, as per the Loan
Contract of this same date. In the grid attached to this Promissory Note, the
holder of this note will annotate the loans taken and paid by virtue of said
credit line.
In
San
Xxxx, Puerto Rico, on the fourteenth (14th)
of June
of two thousand five (2005)
XXXXX
CARIBE, INC.
|
By:
|
________________________________________ |
|
XXXXXXX
XXXXXX XXXXXXX XXXXXX
|
|
|
President
|
Affidavit
Number: __________
Acknowledged
and signed before me by Xxxxxxx Xxxxxx Xxxxxxx Xxxxxx, in his capacity as
President of Xxxxx Caribe, Inc., of legal age, owner and resident of Dorado,
Puerto Rico, who I attest to knowing personally. In San Xxxx, Puerto Rico,
on
the fourteenth (14th)
of June
of two thousand five (2005).
| __________________________________ | |
|
Notary
Public
|
25
