PROMISSORY NOTE
Exhibit
10.11
PROMISSORY
NOTE
|
$4,450,000
|
June
26, 2007
|
FOR
VALUE
RECEIVED, the undersigned, XXXXX
XXXXXX I REAL ESTATE, LLC,
a
Florida limited liability company, having an address at 0000 Xxxx Xxxx Xxxx,
Xxxxxxx, Xxxxxxx 00000, (the “Borrower”),
promises to pay to the order of XXXXXXX
FUNDING, INC.
(“Agent”),
with
an office at Two University Xxxxx, Xxxxx 000, Xxxxxxxxxx, Xxx Xxxxxx 00000,
as
agent for the lenders identified on Schedule
A
annexed
hereto (Agent and the lenders identified on Schedule A are hereinafter
collectively referred to as “Lender”),
the
principal sum of FOUR
MILLION FOUR HUNDRED FIFTY THOUSAND ($4,450,000) DOLLARS,
or so
much thereof as may be advanced by Lender to Borrower from time to time (the
“Principal
Amount”),
together with interest on the unpaid Principal Amount thereof computed from
the
date advanced (the “Commencement
Date”),
at
the rates provided herein until June 25, 2010 or such earlier date on which
the
Principal Amount becomes due and payable as provided herein (the “Maturity
Date”);
provided, however, that from and after (i) the Maturity Date, whether upon
stated maturity, acceleration or otherwise, or (ii) the date on which the
interest rate hereunder is increased to the Default Rate (as hereinafter
defined) as provided herein, such additional interest shall be computed at
the
Default Rate.
As
used
herein, the term “Default
Rate”
shall
mean a rate of interest of twenty-four percent (24.0%) per annum, but in no
event shall the Default Rate be in excess of the Maximum Rate (as hereinafter
defined).
If
any
payment of interest is not paid within five (5) days from the due date for
such
payment, a late charge equal to the lesser of ten percent (10%) of such overdue
payment or the maximum amount permitted by applicable law shall automatically
become due to the holder of this promissory note (the “Note”),
subject, however, to the limitation that late charges may be assessed only
once
on each overdue payment. Said late charges do not constitute interest and shall
constitute compensation to the holder of this Note for collection and co-lender
administration costs incurred hereunder. In addition, if any payment of
principal or interest is not paid when due, the holder of this Note shall have
the right, upon notice to Borrower, to increase the rate of interest per annum
on all amounts outstanding to the Default Rate and, upon said notice, such
rate
increase shall be effective retroactively as of the date from which the interest
component of such overdue payment began to accrue and shall remain in force
and
effect for so long as such default shall continue. This paragraph shall not
be
construed as an agreement or privilege to extend the due date of any payment,
nor as a waiver of any other right or remedy accruing to the holder of this
Note
by reason of any default.
1
Principal
and interest hereunder shall be payable as follows:
(a) From
the
Commencement Date, interest on the Principal Amount outstanding hereof shall
accrue at the rate of Twelve (12.0%) percent per annum, for the period beginning
on and including the Commencement Date to the last day of the month in which
the
Commencement Date occurs (“Short
Interest”),
and
shall be payable on August 1, 2007.
(b) Interest
only at the rate per annum equal to the greater of (i) Twelve (12%) percent
and
(ii) the Prime Rate (as defined below) as adjusted from time to time, plus
Three
and Three Quarters (3 3/4%) Percent on the Principal Amount outstanding hereof
shall accrue from July 1, 2007 through June 30, 2008 and be paid monthly, in
arrears, in an amount, as determined by Xxxxxx, equal to one-twelfth (1/12th)
of
the annual interest payments for such period commencing August 1, 2007 and
continuing on the first day of each month thereafter through and including
July
1, 2008.
(c) Interest
only at the rate per annum equal to the greater of (i) Sixteen (16%) percent
and
(ii) the Prime Rate (as defined below) as adjusted from time to time, plus
Seven
and Three Quarters (7 3/4%) Percent on the Principal Amount outstanding hereof
shall accrue from July 1, 2008 through June 30, 2009 and be paid monthly, in
arrears, in an amount, as determined by Lender, equal to one-twelfth (1/12th)
of
the annual interest payments for such period commencing August 1, 2008 and
continuing on the first day of each month thereafter through and including
July
1, 2009.
(d) Interest
only at the rate per annum equal to the greater of (i) Eighteen (18.0%) percent
and (ii) the Prime Rate, as adjusted from time to time, plus Nine and Three
Quarters (9 3/4%) Percent, on the Principal Amount outstanding hereof shall
accrue from July 1, 2009 through the Maturity Date and be paid monthly in
arrears, in an amount, as determined by Xxxxxx, equal to one-twelfth (1/12th)
of
the annual interest payment for each twelve (12) month period commencing on
August 1, 2009 and continuing on the first day of each month thereafter until
the Maturity Date.
(e) All
principal, interest and other sums due hereunder shall be due and payable in
full on the Maturity Date.
As
used
herein, the term “Prime Rate” shall mean the rate of interest published in The
Wall Street Journal from time to time as the "Prime Rate." If more than one
"Prime Rate" is published in The Wall Street Journal for a day, the average
of
such "Prime Rates" shall be used, and such average shall be rounded up to the
nearest one-eighth of one percent (0.125%). If The Wall Street Journal ceases
to
publish the "Prime Rate," the Agent shall select an equivalent publication
that
publishes such "Prime Rate," and if such "Prime Rates" are no longer generally
published or are limited, regulated or administered by a governmental or
quasigovernmental body, then Agent shall select a comparable interest rate
index. If interest on this Note is calculated at the Prime Rate as provided
herein, then the interest rate will change on July 1, 2007 and on the first
day
of each month thereafter following any change in the Prime Rate.
2
(f) Prepaid
Interest (as defined in the Loan and Security Agreement of even date herewith,
hereinafter, the “Loan
Agreement”),
if
any, shall be utilized in accordance with the terms of the Loan
Agreement.
Each
payment hereunder shall be credited first to Xxxxxx’s collection expenses, next
to late charges, next to unpaid interest, and the balance, if any, to the
reduction of the Principal Amount. The interest on this Note shall be calculated
on the basis of a 30-day month and a 360-day year.
This
Note
may be prepaid in whole or in part at any time, without penalty or premium,
it
being understood and agreed that, except as expressly provided herein or in
the
Loan Agreement, Borrower shall not be entitled, by virtue of any prepayment
or
otherwise, to a refund of the Fee (as defined in the Loan Agreement), interest,
any other fees, points, charges and the like paid by Borrower to Lender in
connection with the loan hereunder (the “Loan”)
and
for fees and expenses incurred by Xxxxxx in making the Loan, all of which
payments shall be retained by Xxxxxx from and after the date each such payment
is made hereunder.
Borrower
and each surety, endorser and guarantor hereof hereby waive all demands for
payment, presentations for payment, notices of intention to accelerate maturity,
notices of acceleration of maturity, demand for payment, protest, notice of
protest and notice of dishonor, to the extent permitted by law. Xxxxxxxx further
waives trial by jury. No extension of time for payment of this Note or any
installment hereof, no alteration, amendment or waiver of any provision of
this
Note and no release or substitution of any collateral securing Borrower’s
obligations hereunder shall release, modify, amend, waive, extend, change,
discharge, terminate or affect the liability of Borrower under this
Note.
Any
forbearance by the holder of this Note in exercising any right or remedy
hereunder or under any other agreement or instrument in connection with the
Loan
or otherwise afforded by applicable law, shall not be a waiver or preclude
the
exercise of any right or remedy by the holder of this Note. The acceptance
by
the holder of this Note of payment of any sum payable hereunder after the due
date of such payment shall not be a waiver of the right of the holder of this
Note to require prompt payment when due of all other sums payable hereunder
or
to declare a default for failure to make prompt payment.
If
this
Note is placed in the hands of an attorney for collection, Borrower shall pay
all costs incurred and reasonable attorneys’ fees for legal services in the
collection effort, whether or not suit be brought.
3
At
the
election of the holder of this Note, all payments due hereunder may be
accelerated, and this Note shall become immediately due and payable without
notice or demand, upon the occurrence of any of the following events (each
an
“Event
of Default”):
(1)
Borrower fails to pay on or before the date due, any amount of principal
and/or
interest payable hereunder; (2) Borrower fails to perform or observe any
other
term or provision of this Note with respect to payment; provided,
however,
that
Borrower shall be provided with a ten (10) calendar day period to cure same;
(3)
Borrower fails to perform or observe any other term or provision of this
Note;
provided,
however,
that
Borrower shall be provided with written notice from Lender of any non-monetary
default under this Note and a thirty (30) calendar day period to cure same;
or
(4) there exists a default under the Mortgage (as hereinafter defined), a
default under any Guaranty (as hereinafter defined) or a default under or
misrepresentation contained in any other agreement, document or certificate
of
Borrower or any Guarantor (as hereinafter defined) in connection with the
Loan,
which default is not cured within any grace period expressly provided therefor
in such document. In addition to the rights and remedies provided herein,
the
holder of this Note may exercise any other right or remedy in any other
document, instrument or agreement evidencing, securing or otherwise relating
to
the indebtedness evidenced hereby in accordance with the terms thereof, or
under
applicable law, all of which rights and remedies shall be
cumulative.
If
this
Note is transferred in any manner, the right, option or other provisions herein
shall apply with equal effect in favor of any subsequent holder
hereof.
Notwithstanding
anything to the contrary contained herein, under no circumstances shall the
aggregate amount paid or agreed to be paid hereunder exceed the highest lawful
rate permitted under applicable usury law (the “Maximum
Rate”)
and
the payment obligations of Borrower under this Note are hereby limited
accordingly. If under any circumstances, whether by reason of advancement or
acceleration of the maturity of the unpaid principal balance hereof or
otherwise, the aggregate amounts paid on this Note shall include amounts which
by law are deemed interest and which would exceed the Maximum Rate, Borrower
stipulates that payment and collection of such excess amounts shall have been
and will be deemed to have been the result of a mistake on the part of both
Borrower and the holder of this Note, and the party receiving such excess
payments shall promptly credit such excess (to the extent only of such payments
in excess of the Maximum Rate) against the unpaid principal balance hereof
and
any portion of such excess payments not capable of being so credited shall
be
refunded to Borrower.
4
This Note
is
secured by, among other things, that certain Mortgage and Security Agreement
(the “Mortgage”),
an
assignment of leases and rents (“Assignment”),
an
assignment of licenses, contracts, plans, specifications, surveys, drawings
and
reports (the “Assignment
of Licenses”),
all
of the foregoing being of even date herewith and a first lien on the certain
real estate collateral (the “Collateral”)
identified in the Mortgage, and is entitled to the benefits and security
thereof. Reference is made to the Mortgage, Assignment and Assignment of
Licenses for descriptions of the respective rights and obligations of the
Borrower and Lender thereunder. This Note is guaranteed by the separate guaranty
of even date herewith (the “Guaranty”)
of
American Leisure Holdings, Inc.,
TDS
Amenities, Inc. and Xxxxxxx Xxxxxx (collectively, the “Guarantor”)
and
reference is made to the Guaranty for the respective rights of the parties
thereunder. Borrower hereby agrees to indemnify, defend and hold harmless Lender
from and against any and all claims, loss, cost, damage or expense (including,
without limitation, reasonable attorneys’ fees) which may be incurred by Lender
in connection with or as a result of any default (following notice and the
opportunity to cure provided for in such document), other than consequential
and
incidental damages, by Borrower or Guarantor under the Mortgage, Assignment,
or
Assignment of Licenses, or by the Guarantor (following notice and the
opportunity to cure provided for in such document) under the Guaranty, or a
default (following notice and the opportunity to cure provided for in such
document) under or misrepresentation contained in any other agreement, document
or certificate of Borrower or any Guarantor executed or delivered in connection
with the Loan (collectively, the “Loan
Documents”).
By
its
acceptance of Xxxxxx’s funds and execution of this Note, Xxxxxxxx acknowledges,
agrees and confirms that it has no defense, offset or counterclaim for any
occurrence in relation to this Loan and Borrower acknowledges that Xxxxxx has
complied with all of its obligations under the Loan Documents as of the date
hereof.
All
payments of principal and interest hereunder are payable in lawful money of
the
United States of America and shall be made by wire transfer to the account
of
Agent or KF Holdings SPV, LLC, as instructed, at Valley National Bank, pursuant
to wiring instructions to be provided to Borrower at Closing or to such other
accounts as may be instructed by Agent.
Borrower
is hereby prohibited from exercising against Xxxxxx (as a group) or Agent,
any
right or remedy which it might otherwise be entitled to exercise against any
one
or more (but less than all) of the parties constituting Lender, including,
without limitation, any right of setoff or any defense. Any other claim that
Borrower may have, arising from or related to the transaction evidenced by
this
Note and the other Loan Documents shall be asserted only against the Agent
and
not against any of the individual parties constituting Lender.
This
Note
shall be binding on the parties hereto and their respective heirs, legal
representatives, executors, successors and assigns.
This
Note
shall be construed without any regard to any presumption or rule requiring
construction against the party causing such instrument or any portion thereof
to
be drafted.
This
Note
shall be governed by the laws of the State of New Jersey without regard to
choice of law consideration. Borrower hereby irrevocably consents to the
jurisdiction of the courts of the State of New Jersey and of any federal court
located in such State in connection with any action or proceeding arising out
of
or relating to this Note or the other
Loan Documents. Borrower and Guarantor hereby designate The Corporation Trust
Company, located at 000 Xxxx Xxxxxx Xxxx, Xxxx Xxxxxxx, Xxx Xxxxxx 00000, as
their duly appointed agent to accept service of process within the State of
New
Jersey on their behalf.
5
This
Note
may not be changed or terminated orally.
A
determination that any portion of this Note is unenforceable or invalid shall
not affect the enforceability or validity of any other provision, and any
determination that the application of any provision of this Note to any person
or circumstance is illegal or unenforceable shall not affect the enforceability
or validity of such provision to the extent legally permissible and otherwise
as
it may apply to other persons or circumstances.
Xxxxxxxx
understands and agrees that the Loan is and will be cross-collateralized with
that certain loan dated
as
of April 20, 2007 in
the
amount of Twenty
Four Million Nine Hundred Thousand ($24,900,000) Dollars by and between Costa
Xxxxxx XX Real Estate, LLC, Xxxxx Xxxxxx III Real Estate, LLC, TDS Town Homes
(Phase 1), LLC, TDS Town Homes (Phase 2), LLC and Lender, as Agent (the
“Costa
II Loan”).
It is
understood and agreed that a default (beyond any applicable grace periods)
under
the terms and conditions of (i) that certain Loan and Security Agreement dated
as of April 20, 2007, between Costa
Xxxxxx XX Real Estate, LLC, Xxxxx Xxxxxx III Real Estate, LLC, TDS Town Homes
(Phase 1), LLC, TDS Town Homes (Phase 2), LLC and Lender, as Agent, as amended
by that certain First Amendment to Loan and Security Agreement and Other Loan
Documents of even date herewith, and/or (ii) any other document or agreement
given or delivered to Lender in connection therewith, including without
limitation that certain (a) Amended and Restated Promissory Note in the original
principal amount of Twenty Four Million Nine Hundred Thousand ($24,900,000)
Dollars of even date herewith, and (b) and that certain Mortgage and Security
Agreement, as amended by that certain First Amendment to Mortgage and Security
Agreement of even date herewith, filed in the County of Polk, State of Florida
which was given as security for the repayment of said Promissory Note (the
“Costa
II Loan Documents”)
will
also constitute a default under the terms and conditions of the Loan and will
entitle Lender to all rights and remedies available to Lender under the Costa
II
Loan Documents. It is further understood and agreed that in the event Borrower
defaults (beyond any applicable grace periods) upon the terms and conditions
of
the Loan or any of the Loan Documents executed or delivered in connection with
the Loan, Lender shall have the right to declare the Costa II Loan in default
and accelerate same and avail itself of any rights and remedies thereunder.
Borrower shall execute any and all documents necessary to effectuate such
cross-collateralization.
6
JURY
TRIAL WAIVER. XXXXXXXX AGREES THAT ANY SUIT, ACTION OR PROCEEDING, WHETHER
CLAIM
OR COUNTERCLAIM, BROUGHT BY BORROWER OR THE HOLDER OF THIS NOTE ON OR WITH
RESPECT TO THIS NOTE OR ANY OTHER LOAN DOCUMENT OR THE DEALINGS
OF THE PARTIES WITH RESPECT HERETO OR THERETO, SHALL BE TRIED ONLY BY A COURT
AND NOT BY A JURY. XXXXXXXX AND XXXXXX EACH HEREBY KNOWINGLY, VOLUNTARILY
AND
INTENTIONALLY WAIVE ANY RIGHT TO A TRIAL BY JURY IN ANY SUCH SUIT, ACTION
OR
PROCEEDING. XXXXXXXX ACKNOWLEDGES AND AGREES THAT AS OF THE DATE HEREOF THERE
ARE NO DEFENSES OR OFFSETS TO ANY AMOUNTS DUE IN CONNECTION WITH THE LOAN.
FURTHER, BORROWER WAIVES ANY RIGHT IT MAY HAVE TO CLAIM OR RECOVER, IN ANY
SUCH
SUIT, ACTION OR PROCEEDING, ANY SPECIAL, EXEMPLARY, PUNITIVE, CONSEQUENTIAL
OR
OTHER DAMAGES OTHER THAN, OR IN ADDITION TO, ACTUAL DAMAGES. XXXXXXXX
ACKNOWLEDGES AND AGREES THAT THIS PARAGRAPH IS A SPECIFIC AND MATERIAL ASPECT
OF
THIS NOTE AND THAT LENDER WOULD NOT EXTEND CREDIT TO BORROWER IF THE WAIVERS
SET
FORTH IN THIS PARAGRAPH WERE NOT A PART OF THIS NOTE.
[Remainder
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7
IN
WITNESS WHEREOF, the undersigned has executed this Note on the date set forth
above.
|
WITNESS:
/s/
Xxxxx Xxxxxxxx
Name:
Xxxxx Xxxxxxxx
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XXXXXXXX:
XXXXX
XXXXXX I REAL ESTATE, LLC,
a
Florida limited liability company
By:
Tierra del Sol Resort (Phase 1), Ltd., a Florida limited partnership,
its
manager
By:
TDS Management, LLC, a Florida limited liability company, its general
partner
By:
/s/ Xxxxxxx X. Xxxxxx
Name:
Xxxxxxx X. Xxxxxx
Title:
Manager
|
|
STATE
OF FLORIDA
|
)
|
|
)
ss.:
|
|
|
COUNTY
OF ORANGE
|
)
|
I
certify
that on June 20th, 2007, Xxxxxxx X. Xxxxxx came before me in person and
stated to my satisfaction that he/she:
(a)
made
the
attached instrument; and
(b)
was
authorized to and did execute this instrument on behalf of and as Manager of
TDS
MANAGEMENT, LLC, a Florida limited liability company, the General Partner of
TIERRA DEL SOL RESORT (PHASE 1), LTD., a Florida limited partnership, the
Manager of XXXXX XXXXXX I REAL ESTATE, LLC, a Florida limited liability company
(the “Company”), the entity named in this instrument, as the free act and deed
of the Company, by virtue of the authority granted by its operating agreement
and its members.
/s/
X.X. Xxxxxx
NOTARY
PUBLIC
#DD459074
8
SCHEDULE
A
LENDERS
A-1
