Exhibit 10.189
PURCHASE AND CONTRIBUTION AGREEMENT
This PURCHASE AND CONTRIBUTION AGREEMENT (this "Agreement"), dated as of
September 15, 2006, is by and among Bluegreen Corporation, a Massachusetts
corporation ("Bluegreen" or a "Seller") and Bluegreen Receivables Finance
Corporation XII, a Delaware corporation (the "Depositor") and their respective
permitted successors and assigns.
W I T N E S S E T H:
- - - - - - - - - -
WHEREAS, on the Closing Date, the Depositor, as seller, intends to
enter into that certain Sale Agreement dated as of September 15, 2006 (the "Sale
Agreement"), by and between the Depositor and BXG Receivables Note Trust 2006-B,
a Delaware statutory trust (the "Issuer") pursuant to which the Depositor
intends to sell to the Issuer the timeshare loans acquired pursuant to the terms
of this Agreement and certain other timeshare loans acquired by the Depositor
pursuant to a transfer agreement, dated as of September 15, 2006, by and among
the Depositor, Bluegreen and BXG Timeshare Trust I from time to time pursuant to
the terms thereof;
WHEREAS, on the Closing Date, Bluegreen intends to enter into that
certain Indenture dated as of September 15, 2006 (the "Indenture"), by and among
the Issuer, Bluegreen, as servicer (in such capacity, the "Servicer"), Vacation
Trust, Inc., a Florida corporation, as club trustee (the "Club Trustee"),
Concord Servicing Corporation, as backup servicer, and U.S. Bank National
Association, as indenture trustee (the "Indenture Trustee"), paying agent and
custodian, whereby the Issuer will pledge the Trust Estate (as defined in the
Indenture) to the Indenture Trustee to secure the Issuer's 5.605% Timeshare
Loan-Backed Notes, Series 2006-B, Class A, 5.704% Timeshare Loan-Backed Notes,
Series 2006-B, Class B, 5.952% Timeshare Loan-Backed Notes, Series 2006-B, Class
C, 6.468% Timeshare Loan-Backed Notes, Series 2006-B, Class D, 7.210% Timeshare
Loan-Backed Notes, Series 2006-B, Class E and 9.377% Timeshare Loan-Backed
Notes, Series 2006-B, Class F (collectively, the "Notes");
WHEREAS, (A) on the Closing Date (i) the Seller desires to sell, and
the Depositor desires to purchase Timeshare Loans originated by the Seller or an
Affiliate thereof (the "Initial Timeshare Loans") and (ii) Bluegreen, as the
sole shareholder of the Depositor, desires to make a contribution of capital
pursuant to the terms hereof and (B) on each Transfer Date during the Prefunding
Period (i) the Seller desires to sell, and the Depositor desires to purchase
Timeshare Loans originated by the Seller or an Affiliate thereof (the
"Subsequent Timeshare Loans") and (ii) Bluegreen, as the sole shareholder of the
Depositor, desires to make a contribution of capital pursuant to the terms
hereof;
WHEREAS, pursuant to the terms of (i) the Sale Agreement, the
Depositor shall sell to the Issuer the Initial Timeshare Loans on the Closing
Date and any Subsequent Timeshare Loans acquired from the Seller and (ii) the
Indenture, the Issuer shall pledge the Initial Timeshare
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Loans and the Subsequent Timeshare Loans, as part of the Trust Estate, to the
Indenture Trustee to secure the Notes;
WHEREAS, the Seller may, and in certain circumstances will be
required, to cure, repurchase or substitute and provide one or more Qualified
Substitute Timeshare Loans for a Timeshare Loan that is a Defective Timeshare
Loan, previously sold to the Depositor hereunder and pledged to the Indenture
Trustee pursuant to the Indenture; and
WHEREAS, the Depositor may, at the direction of the Seller, be
required to exercise the Seller's option to purchase or replace Timeshare Loans
that become subject to an Upgrade or Defaulted Timeshare Loans previously sold
to the Issuer and pledged to the Indenture Trustee pursuant to the Indenture.
NOW, THEREFORE, in consideration of the mutual covenants set forth
herein, and for other valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties hereto covenant and agree as follows:
SECTION 1. Definitions; Interpretation. Capitalized terms used but
not defined herein shall have the meanings specified in "Standard Definitions"
attached as Annex A to the Indenture.
SECTION 2. Acquisition of Timeshare Loans and Contribution of
Capital to the Depositor.
(a) Timeshare Loans and Contribution of Capital. On the Closing Date
(with respect to the Initial Timeshare Loans) and on each Transfer Date during
the Prefunding Period (with respect to the Subsequent Timeshare Loans), the
Seller hereby agrees to (x) sell in part and contribute in part to the Depositor
in return for the Timeshare Loan Acquisition Price for each Timeshare Loan to be
sold on the Closing Date or such Transfer Date, as applicable, to be paid in
part in cash and in part as an increase in its equity ownership of the Depositor
and (y) transfer, assign, sell and grant to the Depositor, without recourse
(except as provided in Section 6 and Section 8 hereof), any and all of the
Seller's right, title and interest in and to (i) any Timeshare Loans listed on
Schedule III hereto or the related Subsequent Transfer Notice, as applicable,
(ii) the Receivables in respect of such Timeshare Loans due after the related
Cut-Off Date, (iii) the related Timeshare Loan Documents (excluding any rights
as developer or declarant under the Timeshare Declaration, the Timeshare Program
Consumer Documents or the Timeshare Program Governing Documents), (iv) all
Related Security in respect of each such Timeshare Loan and (v) all income,
payments, proceeds and other benefits and rights related to any of the foregoing
(the property in clauses (i)-(v), being the "Assets"). Upon such contribution,
sale and transfer, the ownership of each Timeshare Loan and all collections
allocable to principal and interest thereon after the related Cut-Off Date and
all other property interests or rights conveyed pursuant to and referenced in
this Section 2(a) shall immediately vest in the Depositor, its successors and
assigns. The Seller shall not take any action inconsistent with such ownership
nor claim any ownership interest in any Timeshare Loan for any purpose
whatsoever other than for federal and state income tax reporting, if applicable.
The parties to this Agreement hereby acknowledge that the
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"credit risk" of the Timeshare Loans conveyed hereunder shall be borne by the
Depositor and its subsequent assignees.
(b) Delivery of Timeshare Loan Documents. In connection with the
contribution, sale, transfer, assignment and conveyance of any Timeshare Loan
hereunder, the Seller hereby agrees to deliver or cause to be delivered, on the
Closing Date (with respect to any Initial Timeshare Loan), at least five
Business Days prior to each Transfer Date during the Prefunding Period (with
respect to any Subsequent Timeshare Loan) and on or within five Business Days
from each Transfer Date (with respect to any Qualified Substitute Timeshare
Loan), as applicable, to the Custodian all related Timeshare Loan Files and to
the Servicer all related Timeshare Loan Servicing Files.
(c) Collections. The Seller shall deposit or cause to be deposited
all collections in respect of Timeshare Loans received by the Seller or its
Affiliates after the related Cut-Off Date in the Lockbox Account and, with
respect to Credit Card Timeshare Loans, direct each applicable credit card
vendor to deposit all payments in respect of such Credit Card Timeshare Loans to
the Credit Card Account (net of the Servicer Credit Card Processing Costs).
(d) Limitation of Liability. Neither the Depositor nor any
subsequent assignee of the Depositor shall have any obligation or liability with
respect to any Timeshare Loan nor shall the Depositor or any subsequent assignee
have any liability to any Obligor in respect of any Timeshare Loan. No such
obligation or liability is intended to be assumed by the Depositor or any
subsequent assignee herewith and any such liability is hereby expressly
disclaimed.
SECTION 3. Intended Characterization; Grant of Security Interest. It
is the intention of the parties hereto that each transfer of Timeshare Loans to
be made pursuant to the terms hereof shall constitute a sale, in part, and a
capital contribution, in part, by the Seller to the Depositor and not a loan
secured by such Timeshare Loans. In the event, however, that a court of
competent jurisdiction were to hold that any such transfer constitutes a loan
and not a sale and contribution, it is the intention of the parties hereto that
the Seller shall be deemed to have granted to the Depositor as of the date
hereof a first priority perfected security interest in all of the Seller's
right, title and interest in, to and under the Assets specified in Section 2
hereof and the proceeds thereof and that with respect to such transfer, this
Agreement shall constitute a security agreement under applicable law. In the
event of the characterization of any such transfer as a loan, the amount of
interest payable or paid with respect to such loan under the terms of this
Agreement shall be limited to an amount which shall not exceed the maximum
non-usurious rate of interest allowed by the applicable state law or any
applicable law of the United States permitting a higher maximum non-usurious
rate that preempts such applicable state law, which could lawfully be contracted
for, charged or received (the "Highest Lawful Rate"). In the event any payment
of interest on any such loan exceeds the Highest Lawful Rate, the parties hereto
stipulate that (a) to the extent possible given the term of such loan, such
excess amount previously paid or to be paid with respect to such loan be applied
to reduce the principal balance of such loan, and the provisions thereof
immediately be deemed reformed and the amounts thereafter collectible thereunder
reduced, without the necessity of the execution of any new document, so as to
comply with the then applicable law, but so as to permit the recovery of the
fullest amount otherwise called for thereunder and (b) to the extent that the
reduction of the
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principal balance of, and the amounts collectible under, such loan and the
reformation of the provisions thereof described in the immediately preceding
clause (a) is not possible given the term of such loan, such excess amount will
be deemed to have been paid with respect to such loan as a result of an error
and upon discovery of such error or upon notice thereof by any party hereto such
amount shall be refunded by the recipient thereof.
The characterization of the Seller as "debtor" and the Depositor as
"secured party" in any such security agreement and any related financing
statements required hereunder is solely for protective purposes and shall in no
way be construed as being contrary to the intent of the parties that this
transaction be treated as a sale and contribution to the Depositor of the
Seller's entire right, title and interest in and to the Assets.
Each of the Seller, the Club, the Club Trustee and any of their Affiliates
hereby agrees to make the appropriate entries in its general accounting records
to indicate that the Timeshare Loans have been transferred to the Depositor and
its subsequent assignees.
SECTION 4. Conditions Precedent to Acquisition of Timeshare Loans by
the Depositor. The obligations of the Depositor to purchase any Timeshare Loans
hereunder shall be subject to the satisfaction of the following conditions:
(a) On the Closing Date, with respect to the Initial Timeshare
Loans, and on each Transfer Date, with respect to each Subsequent Timeshare Loan
or any Qualified Substitute Timeshare Loan replacing a Timeshare Loan, all
representations and warranties of the Seller contained in Section 5(a) hereof
shall be true and correct on such date as if made on such date, and all
representations and warranties as to the Timeshare Loans contained in Section
5(b) hereof and all information provided in the Schedule of Timeshare Loans in
respect of each such Timeshare Loan conveyed on the Closing Date or such
Transfer Date, as applicable, shall be true and correct on such date.
(b) On or prior to the Closing Date or a Transfer Date (or, with
respect to Qualified Substitute Timeshare Loans, as provided for in Section 6(g)
hereof), as applicable, the Seller shall have delivered or shall have caused the
delivery of (i) the related Timeshare Loan Files to the Custodian and the
Custodian shall have delivered a Custodian's Certification therefor pursuant to
the Custodial Agreement and (ii) the Timeshare Loan Servicing Files to the
Servicer.
(c) The Seller shall have delivered or caused to be delivered all
other information theretofore required or reasonably requested by the Depositor
to be delivered by the Seller or performed or caused to be performed all other
obligations required to be performed as of the Closing Date or Transfer Date, as
the case may be, including all filings, recordings and/or registrations as may
be necessary in the reasonable opinion of the Depositor, the Issuer or the
Indenture Trustee to establish and preserve the right, title and interest of the
Depositor, the Issuer or the Indenture Trustee, as the case may be, in the
related Timeshare Loans.
(d) On or before the Closing Date and on each Transfer Date, the
Indenture shall be in full force and effect.
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(e) With respect to the Initial Timeshare Loans, the Notes shall be
issued and sold on the Closing Date, and the Issuer and the Depositor shall
receive the full consideration due it upon the issuance of the Notes, and the
Issuer and the Depositor shall have applied their respective consideration to
the extent necessary, to pay the Timeshare Loan Acquisition Price for each
Initial Timeshare Loan;
(f) With respect to the Subsequent Timeshare Loans, the Depositor
shall apply funds received from the Issuer withdrawn from the Prefunding
Account, to the extent necessary, to pay the Seller the Timeshare Loan
Acquisition Price for each Subsequent Timeshare Loan.
(g) Each Timeshare Loan conveyed on the Closing Date or a Transfer
Date shall be an Eligible Timeshare Loan and each of the conditions herein and
in the Indenture for the purchases of Initial Timeshare Loans and Subsequent
Timeshare Loans shall have been satisfied.
(h) Each Qualified Substitute Timeshare Loan replacing a Timeshare
Loan shall satisfy each of the criteria specified in the definition of
"Qualified Substitute Timeshare Loan" and each of the conditions herein and in
the Indenture for substitution of Timeshare Loans shall have been satisfied.
(i) The Depositor shall have received such other certificates and
opinions as it shall reasonably request.
SECTION 5. Representations and Warranties and Certain Covenants of
the Seller.
(a) The Seller represents and warrants to the Depositor and the
Indenture Trustee for the benefit of the Noteholders, on the Closing Date and on
each Transfer Date (with respect to any Subsequent Timeshare Loans or Qualified
Substitute Timeshare Loans transferred on such Transfer Date) as follows:
(i) Due Incorporation; Valid Existence; Good Standing. It is a
corporation duly organized and validly existing in good standing under the
laws of the jurisdiction of its incorporation; and is duly qualified to do
business as a foreign corporation and in good standing under the laws of
each jurisdiction where the character of its property, the nature of its
business or the performance of its obligations under this Agreement makes
such qualification necessary, except where the failure to be so qualified
will not have a material adverse effect on its business or its ability to
perform its obligations under this Agreement or any other Transaction
Document to which it is a party or under the transactions contemplated
hereunder or thereunder or the validity or enforceability of any Timeshare
Loans.
(ii) Possession of Licenses, Certificates, Franchises and
Permits. It holds, and at all times during the term of this Agreement will
hold, all material licenses, certificates, franchises and permits from all
governmental authorities necessary for the conduct of its business, and
has received no notice of proceedings relating to the revocation of any
such license, certificate, franchise or permit, which singly or in the
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aggregate, if the subject of an unfavorable decision, ruling or finding,
would materially and adversely affect its ability to perform its
obligations under this Agreement or any other Transaction Document to
which it is a party or under the transactions contemplated hereunder or
thereunder or the validity or enforceability of any Timeshare Loans.
(iii) Corporate Authority and Power. It has, and at all times
during the term of this Agreement will have, all requisite corporate power
and authority to own its properties, to conduct its business, to execute
and deliver this Agreement and all documents and transactions contemplated
hereunder and to perform all of its obligations under this Agreement and
any other Transaction Document to which it is a party or under the
transactions contemplated hereunder or thereunder. It has all requisite
corporate power and authority to acquire, own, transfer and convey
Timeshare Loans to the Depositor.
(iv) Authorization, Execution and Delivery Valid and Binding.
This Agreement and all other Transaction Documents and instruments
required or contemplated hereby to be executed and delivered by it have
been duly authorized, executed and delivered by it and, assuming the due
execution and delivery by, the other party or parties hereto and thereto,
constitute legal, valid and binding agreements enforceable against it in
accordance with their respective terms subject, as to enforceability, to
bankruptcy, insolvency, reorganization, liquidation, dissolution,
moratorium and other similar applicable laws affecting the enforceability
of creditors' rights generally applicable in the event of the bankruptcy,
insolvency, reorganization, liquidation or dissolution, as applicable, of
it and to general principles of equity, regardless of whether such
enforceability shall be considered in a proceeding in equity or at law.
This Agreement constitutes a valid transfer of its interest in the
Timeshare Loans to the Depositor or, in the event of the characterization
of any such transfer as a loan, the valid creation of a first priority
perfected security interest in such Timeshare Loans in favor of the
Depositor.
(v) No Violation of Law, Rule, Regulation, etc. The execution,
delivery and performance by it of this Agreement and any other Transaction
Document to which it is a party do not and will not (A) violate any of the
provisions of its articles of incorporation or bylaws, (B) violate any
provision of any law, governmental rule or regulation currently in effect
applicable to it or its properties or by which the Seller or its
properties may be bound or affected, including, without limitation, any
bulk transfer laws, where such violation would have a material adverse
effect on its ability to perform its obligations under this Agreement or
any other Transaction Document to which it is a party or under the
transactions contemplated hereunder or thereunder or the validity or
enforceability of the Timeshare Loans, (C) violate any judgment, decree,
writ, injunction, award, determination or order currently in effect
applicable to it or its properties or by which it or its properties are
bound or affected, where such violation would have a material adverse
effect on its ability to perform its obligations under this Agreement or
any other Transaction Document to which it is a party or under the
transactions contemplated hereunder or thereunder or the validity or
enforceability of any Timeshare Loans, (D) conflict with, or result in a
breach of, or constitute a default under, any of the
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provisions of any indenture, mortgage, deed of trust, contract or other
instrument to which it is a party or by which it is bound where such
violation would have a material adverse effect on its ability to perform
its obligations under this Agreement or any other Transaction Document to
which it is a party or under the transactions contemplated hereunder or
thereunder or the validity or enforceability of Timeshare Loans or (E)
result in the creation or imposition of any Lien upon any of its
properties pursuant to the terms of any such indenture, mortgage, deed of
trust, contract or other instrument.
(vi) Governmental Consent. No consent, approval, order or
authorization of, and no filing with or notice to, any court or other
Governmental Authority in respect of the Seller is required which has not
been obtained in connection with the authorization, execution, delivery or
performance by it of this Agreement or any of the other Transaction
Documents to which it is a party or under the transactions contemplated
hereunder or thereunder, including, without limitation, the transfer of
Timeshare Loans and the creation of the security interest of the Depositor
therein pursuant to Section 3 hereof.
(vii) Defaults. It is not in default under any material
agreement, contract, instrument or indenture to which it is a party or by
which it or its properties is or are bound, or with respect to any order
of any court, administrative agency, arbitrator or governmental body, in
each case, which would have a material adverse effect on the transactions
contemplated hereunder or on its business, operations, financial condition
or assets, and no event has occurred which with notice or lapse of time or
both would constitute such a default with respect to any such agreement,
contract, instrument or indenture, or with respect to any such order of
any court, administrative agency, arbitrator or governmental body.
(viii) Insolvency. It is solvent and will not be rendered
insolvent by the transfer of any Timeshare Loans hereunder. On and after
the Closing Date, it will not engage in any business or transaction the
result of which would cause the property remaining with it to constitute
an unreasonably small amount of capital.
(ix) Pending Litigation or Other Proceedings. Other than as
described in the Offering Circular and on Schedule 5 attached hereto, as
of the Closing Date, there is no pending or, to its Knowledge, threatened
action, suit, proceeding or investigation before any court, administrative
agency, arbitrator or governmental body against or affecting it which, if
decided adversely, would materially and adversely affect (A) its condition
(financial or otherwise), business or operations, (B) its ability to
perform its obligations under, or the validity or enforceability of, this
Agreement or any other documents or transactions contemplated under this
Agreement, (C) any Timeshare Loan or title of any Obligor to any related
Timeshare Property pursuant to the applicable Owner Beneficiary Agreement
or (D) the Depositor's or any of its assigns' ability to foreclose or
otherwise enforce the liens of the Mortgage Notes and the rights of the
Obligors to use and occupy the related Timeshare Properties pursuant to
the applicable Owner Beneficiary Agreement.
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(x) Information. No document, certificate or report furnished
or required to be furnished by or on behalf of it pursuant to this
Agreement, in its capacity as Seller, contains or will contain when
furnished any untrue statement of a material fact or fails or will fail to
state a material fact necessary in order to make the statements contained
therein not misleading in light of the circumstances in which it was made.
There are no facts known to it which, individually or in the aggregate,
materially adversely affect, or which (aside from general economic trends)
may reasonably be expected to materially adversely affect in the future,
the financial condition or assets or its business, or which may impair the
ability of it to perform its obligations under this Agreement, which have
not been disclosed herein or therein or in the certificates and other
documents furnished to the Depositor by or on behalf of it specifically
for use in connection with the transactions contemplated hereby or
thereby.
(xi) Foreign Tax Liability. It is not aware of any Obligor
under a Timeshare Loan who has withheld any portion of payments due under
such Timeshare Loan because of the requirements of a foreign taxing
authority, and no foreign taxing authority has contacted it concerning a
withholding or other foreign tax liability.
(xii) Employee Benefit Plan Liability. As of the Closing Date
and each Transfer Date, as applicable, (i) no "accumulated funding
deficiency" (as such term is defined under ERISA and the Code), whether or
not waived, exists with respect to any "employee pension benefit plan" (as
such term is defined under ERISA) sponsored, maintained or contributed to
by it or any of its Affiliates, and, to its Knowledge, no event has
occurred or circumstance exists that may result in an accumulated funding
deficiency as of the last day of the current plan year of any such plan;
(ii) it and each of its Affiliates has made all contributions required
under each multiemployer plan (as such term is defined under ERISA) (a
"Multiemployer Plan") to which it or any of its Affiliates contributes or
in which it or any of its Affiliates participates (a "Seller Multiemployer
Plan"); and (iii) neither it nor any of its Affiliates has withdrawn from
any Multiemployer Plan with respect to which there is any outstanding
liability and, to its Knowledge, no event has occurred or circumstance
exists that presents a risk of the occurrence of any withdrawal from, or
the partition, termination, reorganization or insolvency of, any Seller
Multiemployer Plan that could result in any liability to it.
(xiii) Taxes. Other than as described on Schedule 5 hereto, as
of the Closing Date, it (i) has filed all tax returns (federal, state and
local) which it reasonably believes are required to be filed and has paid
or made adequate provision in its GAAP financial statements for the
payment of all taxes, assessments and other governmental charges due from
it or is contesting any such tax, assessment or other governmental charge
in good faith through appropriate proceedings or except where the failure
to file or pay will not have a material adverse effect on the rights and
interests of the Depositor, (ii) knows of no basis for any material
additional tax assessment for any fiscal year for which adequate reserves
in its GAAP financial statements have not been established and (iii)
intends to pay all such taxes, assessments and governmental charges, if
any, when due.
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(xiv) Place of Business. The principal place of business and
chief executive office where it keeps its records concerning Timeshare
Loans will be 0000 Xxxxxxxxxx Xxx Xxxxx, Xxxxx 000, Xxxx Xxxxx, Xxxxxxx
00000 (or such other place specified by it by written notice to the
Depositor and the Indenture Trustee). It is a corporation formed under the
laws of the Commonwealth of Massachusetts.
(xv) Securities Laws. It is not an "investment company" or a
company "controlled" by an "investment company" within the meaning of the
Investment Company Act of 1940, as amended. No portion of the Timeshare
Loan Acquisition Price for each of the Timeshare Loans will be used by it
to acquire any security in any transaction which is subject to Section 13
or Section 14 of the Securities Exchange Act of 1934, as amended.
(xvi) Bluegreen Vacation Club. With respect to the Club Loans:
(A) The Club Trust Agreement, of which a true and
correct copy is attached hereto as Exhibit B is in full force and
effect; and a certified copy of the Club Trust Agreement has been
delivered to the Indenture Trustee together with all amendments and
supplements in respect thereof;
(B) The arrangement of contractual rights and
obligations (duly established in accordance with the Club Trust
Agreement under the laws of the State of Florida) was established
for the purpose of holding and preserving certain property for the
benefit of the Beneficiaries referred to in the Club Trust
Agreement. The Club Trustee has all necessary trust and other
authorizations and powers required to carry out its obligations
under the Club Trust Agreement in the State of Florida and in all
other states in which it holds Resort Interests. The Club is not a
corporation or business trust under the laws of the State of
Florida. The Club is not taxable as an association, corporation or
business trust under federal law or the laws of the State of
Florida;
(C) The Club Trustee is a corporation duly formed,
validly existing and in good standing under the laws of the State of
Florida. As of the Closing Date, the Club Trustee is qualified to do
business as a foreign corporation and is in good standing under the
laws of the state of Tennessee. As of each Transfer Date, the Club
Trustee will be duly qualified to do business as a foreign
corporation and will be in good standing under the laws of each
jurisdiction it is required by law to be. The Club Trustee is not an
affiliate of the Servicer for purposes of Chapter 721, Florida
Statutes and is in compliance with the requirements of such Chapter
721 requiring that it be independent of the Servicer;
(D) The Club Trustee has all necessary corporate power
to execute and deliver, and has all necessary corporate power to
perform its obligations under this Agreement, the other Transaction
Documents to which it is a party, the Club Trust Agreement and the
Club Management Agreement. The Club Trustee possesses all requisite
franchises, operating rights, licenses, permits, consents,
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authorizations, exemptions and orders as are necessary to discharge
its obligations under the Club Trust Agreement;
(E) The Club Trustee holds all right, title and interest
in and to all of the Timeshare Properties related to the Club Loans
solely for the benefit of the Beneficiaries referred to in, and
subject in each case to the provisions of, the Club Trust Agreement
and the other documents and agreements related thereto. Except with
respect to the Mortgages, the Club Trustee has permitted none of
such related Timeshare Loans to be made subject to any lien or
encumbrance during the time it has been a part of the trust estate
under the Club Trust Agreement;
(F) There are no actions, suits, proceedings, orders or
injunctions pending against the Club or the Club Trustee, at law or
in equity, or before or by any governmental authority which, if
adversely determined, could reasonably be expect to have a material
adverse effect on the Trust Estate or the Club Trustee's ability to
perform its obligations under the Transaction Documents;
(G) Neither the Club nor the Club Trustee has incurred
any indebtedness for borrowed money (directly, by guarantee, or
otherwise);
(H) All ad valorem taxes and other taxes and assessments
against the Club and/or its trust estate have been paid when due and
neither the Seller nor the Club Trustee knows of any basis for any
additional taxes or assessments against any such property. The Club
has filed all required tax returns and has paid all taxes shown to
be due and payable on such returns, including all taxes in respect
of sales of Owner Beneficiary Rights (as defined in the Club Trust
Agreement) and Vacation Points, if any;
(I) The Club and the Club Trustee are in compliance in
all material respects with all applicable laws, statutes, rules and
governmental regulations applicable to it and in compliance with
each material instrument, agreement or document to which it is a
party or by which it is bound, including, without limitation, the
Club Trust Agreement;
(J) Except as expressly permitted in the Club Trust
Agreement, the Club has maintained the One-to-One Beneficiary to
Accommodation Ratio (as such terms are defined in the Club Trust
Agreement);
(K) Bluegreen Vacation Club, Inc. is a not-for-profit
corporation duly formed, validly existing and in good standing under
the laws of the State of Florida;
(L) Upon purchase of the Club Loans and related Trust
Estate hereunder, the Depositor is an "Interest Holder Beneficiary"
under the Club Trust Agreement and each of the Club Loans
constitutes "Lien Debt", "Purchase Money
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Lien Debt" and "Owner Beneficiary Obligations" under the Club Trust
Agreement; and
(M) Except as disclosed to the Indenture Trustee in
writing or noted in the Custodian's Certification, each Mortgage
associated with a Deeded Club Loan and granted by the Club Trustee
or the Obligor on the related Deeded Club Loan, as applicable, has
been duly executed, delivered and recorded by or pursuant to the
instructions of the Club Trustee under the Club Trust Agreement and
such Mortgage is valid and binding and effective to create the lien
and security interests in favor of the Indenture Trustee (upon
assignment thereof to the Indenture Trustee). Each of such Mortgages
was granted in connection with the financing of a sale of a Resort
Interest.
(b) The Seller hereby makes the representations and warranties
relating to the Timeshare Loans contained in Schedule I hereto for the benefit
of the Depositor, the Issuer and the Indenture Trustee for the benefit of the
Noteholders as of the Closing Date (only with respect to the Initial Timeshare
Loans) and each Transfer Date (only with respect to each Subsequent Timeshare
Loan or Qualified Substitute Timeshare Loan transferred on such Transfer Date),
as applicable.
(c) It is understood and agreed that the representations and
warranties set forth in this Section 5 shall survive the sale and contribution
of each Timeshare Loan to the Depositor and any assignment of such Timeshare
Loans by the Depositor and shall continue so long as any such Timeshare Loans
shall remain outstanding or until such time as such Timeshare Loans are
repurchased, purchased or a Qualified Substitute Timeshare Loan is provided
pursuant to Section 6 hereof. The Seller acknowledges that it has been advised
that the Depositor intends to assign all of its right, title and interest in and
to each Timeshare Loan and its rights and remedies under this Agreement to the
Issuer. The Seller agrees that, upon any such assignment, the Depositor and any
of its assignees may enforce directly, without joinder of the Depositor (but
subject to any defense that the Seller may have under this Agreement) all rights
and remedies hereunder.
(d) With respect to any representations and warranties contained in
Section 5 which are made to the Seller's Knowledge, if it is discovered that any
representation and warranty is inaccurate and such inaccuracy materially and
adversely affects the value of a Timeshare Loan or the interests of the
Depositor or any subsequent assignee thereof, then notwithstanding such lack of
Knowledge of the accuracy of such representation and warranty at the time such
representation or warranty was made (without regard to any Knowledge
qualifiers), such inaccuracy shall be deemed a breach of such representation or
warranty for purposes of the repurchase or substitution obligations described in
Sections 6(a)(i) or (ii) below.
SECTION 6. Repurchases and Substitutions.
(a) Mandatory Repurchases and Substitutions for Breaches of
Representations and Warranties. Upon the receipt of notice by the Seller from
the Depositor, the Issuer or the Indenture Trustee, of a breach of any of the
representations and warranties in Section 5 hereof (on the date on which such
representation or warranty was made) which materially and adversely
11
affects the value of a Timeshare Loan or the interests of the Depositor or any
subsequent assignee of the Depositor (including the Issuer and the Indenture
Trustee on behalf of the Noteholders) therein, the Seller shall, within 60 days
of receipt of such notice, cure in all material respects the circumstance or
condition which has caused such representation or warranty to be incorrect or
either (i) repurchase the Depositor's interest in such Defective Timeshare Loan
from the Depositor at the Repurchase Price or (ii) provide one or more Qualified
Substitute Timeshare Loans and pay the related Substitution Shortfall Amounts,
if any. The Seller acknowledges that the Depositor shall, pursuant to the Sale
Agreement sell Timeshare Loans and rights and remedies acquired hereunder to the
Issuer and that the Issuer shall pledge such Timeshare Loans and rights to the
Indenture Trustee. The Seller further acknowledges that the Indenture Trustee
will be appointed attorney-in-fact under the Indenture and may enforce the
Seller's repurchase or substitution obligations if the Seller has not complied
with its repurchase or substitution obligations under this Agreement within the
aforementioned 60-day period.
(b) Optional Purchases or Substitutions of Club Loans. The Depositor
hereby irrevocably grants to the Seller an option to repurchase or substitute
Original Club Loans it has under the Sale Agreement, the Transfer Agreement and
as described in the following sentence. With respect to any Original Club Loans
for which the related Obligor has elected to effect and the Seller has agreed to
effect an Upgrade, the Seller will (at its option) either (i) pay the Repurchase
Price for such Original Club Loan or (ii) substitute one or more Qualified
Substitute Timeshare Loans for such Original Club Loan and pay the related
Substitution Shortfall Amounts, if any; provided, however, that the Seller's
option to substitute one or more Qualified Substitute Timeshare Loans for an
Original Club Loan is limited on any date to (x) 20% of the Aggregate Closing
Date Collateral Balance less (y) the Loan Balances of all Original Club Loans
previously substituted by the Seller on the related substitution dates pursuant
to this Agreement, the Transfer Agreement and/or the Sale Agreement. The Seller
shall use its best efforts to exercise its substitution option with respect to
Original Club Loans prior to exercise of its repurchase option. To the extent
that the Seller shall elect to substitute Qualified Substitute Timeshare Loans
for an Original Club Loan, the Seller shall use its best efforts to cause each
such Qualified Substitute Timeshare Loan to be, in the following order of
priority, (i) the Upgrade Club Loan related to such Original Club Loan and (ii)
an Upgrade Club Loan unrelated to such Original Club Loan.
(c) Optional Purchases or Substitutions of Defaulted Timeshare
Loans. The Depositor hereby irrevocably grants to the Seller an option to
repurchase or substitute Defaulted Timeshare Loans it has under the Sale
Agreement, the Transfer Agreement and as described in the following sentence.
With respect to Defaulted Timeshare Loans on any date, the Seller will have the
option, but not the obligation, to either (i) purchase a related Defaulted
Timeshare Loan at the Repurchase Price for such related Defaulted Timeshare Loan
or (ii) substitute one or more Qualified Substitute Timeshare Loans for such
related Defaulted Timeshare Loan and pay the related Substitution Shortfall
Amounts, if any; provided, however, that the Seller's option to purchase a
related Defaulted Timeshare Loan or to substitute one or more Qualified
Substitute Timeshare Loans for a related Defaulted Timeshare Loan is limited on
any date to the Optional Purchase Limit and the Optional Substitution Limit,
respectively. The Seller may irrevocably waive its option to purchase or
substitute a related Defaulted Timeshare Loan by delivering to the Indenture
Trustee a Waiver Letter in the form of Exhibit A attached hereto.
12
(d) Payment of Repurchase Prices and Substitution Shortfall Amounts.
The Seller hereby agrees to remit or cause to be remitted all amounts in respect
of Repurchase Prices and Substitution Shortfall Amounts payable during the
related Due Period in immediately available funds to the Indenture Trustee to be
deposited in the Collection Account on the Business Day immediately preceding
the related Payment Date for such Due Period in accordance with the provisions
of the Indenture. In the event that more than one Timeshare Loan is replaced
pursuant to Sections 6(a), (b) or (c) hereof on any Transfer Date, the
Substitution Shortfall Amounts and the Loan Balances of Qualified Substitute
Timeshare Loans shall be calculated on an aggregate basis for all substitutions
made on such Transfer Date.
(e) Schedule of Timeshare Loans. The Seller hereby agrees, on each
date on which a Timeshare Loan has been repurchased, purchased or substituted,
to provide or cause to be provided to the Depositor, the Issuer and the
Indenture Trustee with a electronic supplement to Schedule III hereto and the
Schedule of Timeshare Loans reflecting the removal and/or substitution of
Timeshare Loans and subjecting any Qualified Substitute Timeshare Loans to the
provisions of this Agreement.
(f) Qualified Substitute Timeshare Loans. Pursuant to Section 6(g)
hereof, on the related Transfer Date, the Seller hereby agrees to deliver or to
cause the delivery of the Timeshare Loan Files relating to the Qualified
Substitute Timeshare Loans to the Indenture Trustee or to the Custodian, at the
direction of the Indenture Trustee, in accordance with the provisions of the
Indenture and the Custodial Agreement. As of such related Transfer Date, the
Seller does hereby transfer, assign, sell and grant to the Depositor, without
recourse (except as provided in Section 6 and Section 8 hereof), any and all of
the Seller's right, title and interest in and to (i) each Qualified Substitute
Timeshare Loan conveyed to the Depositor on such Transfer Date, (ii) the
Receivables in respect of the Qualified Substitute Timeshare Loans due after the
related Cut-Off Date, (iii) the related Timeshare Loan Documents (excluding any
rights as developer or declarant under the Timeshare Declaration, the Timeshare
Program Consumer Documents or the Timeshare Program Governing Documents), (iv)
all Related Security in respect of such Qualified Substitute Timeshare Loans and
(v) all income, payments, proceeds and other benefits and rights related to any
of the foregoing. Upon such sale, the ownership of each Qualified Substitute
Timeshare Loan and all collections allocable to principal and interest thereon
after the related Cut-Off Date and all other property interests or rights
conveyed pursuant to and referenced in this Section 6(f) shall immediately vest
in the Depositor, its successors and assigns. The Seller shall not take any
action inconsistent with such ownership nor claim any ownership interest in any
Qualified Substitute Timeshare Loan for any purpose whatsoever other than
consolidated financial and federal and state income tax reporting. The Seller
agrees that such Qualified Substitute Timeshare Loans shall be subject to the
provisions of this Agreement and shall thereafter be deemed a "Timeshare Loan"
for the purposes of this Agreement.
(g) Officer's Certificate for Qualified Substitute Timeshare Loans.
The Seller shall, on each related Transfer Date, certify or cause to be
certified in writing to the Depositor, the Issuer and the Indenture Trustee that
each new Timeshare Loan meets all the criteria of the definition of "Qualified
Substitute Timeshare Loan" and that (i) the Timeshare Loan Files for such
Qualified Substitute Timeshare Loans have been delivered to the Custodian or
shall be
13
delivered within five Business Days, and (ii) the Timeshare Loan Servicing Files
for such Qualified Substitute Timeshare Loans have been delivered to the
Servicer.
(h) Subsequent Transfer Notices. The Seller shall, on each related
Transfer Date, deliver a Subsequent Transfer Notice in the form attached as
Exhibit J to the Indenture, as specified by Section 4.3 of the Indenture.
(i) Release. In connection with any repurchase, purchase or
substitution of one or more Timeshare Loans contemplated by this Section 6, upon
satisfaction of the conditions contained in this Section 6, the Depositor, the
Issuer and the Indenture Trustee shall execute and deliver or shall cause the
execution and delivery of such releases and instruments of transfer or
assignment presented to it by the Seller, in each case without recourse, as
shall be necessary to vest in the Seller or its designee the legal and
beneficial ownership of such Timeshare Loans; provided, however, that with
respect to any release of a Timeshare Loan that is substituted by a Qualified
Substitute Timeshare Loan, the Issuer and the Indenture Trustee shall not
execute and deliver or cause the execution and delivery of such releases and
instruments of transfer or assignment until the Indenture Trustee and the
Servicer receive a Custodian's Certification for such Qualified Substitute
Timeshare Loan. The Depositor, the Issuer and the Indenture Trustee shall cause
the Custodian to release the related Timeshare Loan Files to the Seller or its
designee and the Servicer to release the related Timeshare Loan Servicing Files
to the Seller or its designee; provided, however, that with respect to any
Timeshare Loan File or Timeshare Loan Servicing File related to a Timeshare Loan
that has been substituted by a Qualified Substitute Timeshare Loan, the Issuer
and the Indenture Trustee shall not cause the Custodian and the Servicer to
release the related Timeshare Loan File and the Timeshare Loan Servicing File,
respectively, until the Indenture Trustee and the Servicer receive a Custodian's
Certification for such Qualified Substitute Timeshare Loan.
(j) Sole Remedy. It is understood and agreed that the obligations of
the Seller contained in Section 6(a) to cure a material breach, or to repurchase
or substitute Defective Timeshare Loans and the obligation of the Seller to
indemnify pursuant to Section 8, shall constitute the sole remedies available to
the Depositor or its subsequent assignees for the breaches of any representation
or warranty contained in Section 5 and such remedies are not intended to and do
not constitute "credit recourse" to the Seller.
SECTION 7. Additional Covenants of the Seller. The Seller hereby
covenants and agrees with the Depositor as follows:
(a) It shall comply with all laws, rules, regulations and orders
applicable to it and its business and properties except where the failure to
comply will not have a material adverse effect on its business or its ability to
perform its obligations under this Agreement or any other Transaction Document
to which it is a party or under the transactions contemplated hereunder or
thereunder or the validity or enforceability of the Timeshare Loans.
(b) It shall preserve and maintain its existence (corporate or
otherwise), rights, franchises and privileges in the jurisdiction of its
organization and except where the failure to so preserve and maintain will not
have a material adverse effect on its business or its ability to
14
perform its obligations under this Agreement or any other Transaction Document
to which it is a party or under the transactions contemplated hereunder or
thereunder or the validity or enforceability of the Timeshare Loans.
(c) On the Closing Date and each Transfer Date, as applicable, it
shall indicate in its and its Affiliates' computer files and other records that
each Timeshare Loan has been sold to the Depositor.
(d) It shall respond to any inquiries with respect to ownership of a
Timeshare Loan by stating that such Timeshare Loan has been sold to the
Depositor and that the Depositor is the owner of such Timeshare Loan.
(e) On or prior to the Closing Date, it shall file or cause to be
filed, at its own expense, financing statements in favor of the Depositor, and,
if applicable, the Issuer and the Indenture Trustee on behalf of the
Noteholders, with respect to the Timeshare Loans, in the form and manner
reasonably requested by the Depositor or its assigns. The Seller shall deliver
file-stamped copies of such financing statements to the Depositor, the Issuer
and the Indenture Trustee on behalf of the Noteholders.
(f) It agrees from time to time to, at its expense, promptly execute
and deliver all further instruments and documents, and to take all further
actions, that may be necessary, or that the Depositor, the Issuer or the
Indenture Trustee may reasonably request, to perfect, protect or more fully
evidence the sale and contribution of the Timeshare Loans to the Depositor, or
to enable the Depositor to exercise and enforce its rights and remedies
hereunder or under any Timeshare Loan including, but not limited to, powers of
attorney, UCC financing statements and assignments of mortgage. It hereby
appoints the Depositor, the Issuer and the Indenture Trustee as
attorneys-in-fact, which appointment is coupled with an interest and is
therefore irrevocable, to act on behalf and in the name of the Seller under this
Section 7(f).
(g) Any change in the legal name of the Seller and any use by it of
any tradename, fictitious name, assumed name or "doing business as" name
occurring after the Closing Date shall be promptly within ten Business Days
disclosed to the Depositor and the Indenture Trustee in writing.
(h) Upon the discovery or receipt of notice by a Responsible Officer
of the Seller of a breach of any of its representations or warranties and
covenants contained herein, the Seller shall promptly disclose to the Depositor,
the Issuer and the Indenture Trustee, in reasonable detail, the nature of such
breach.
(i) Except to the extent of any payments received with respect to a
Credit Card Timeshare Loan, in the event that the Seller shall receive any
payments in respect of a Timeshare Loan after the Closing Date or a Transfer
Date, as applicable, the Seller shall, within two Business Days of receipt,
transfer or cause to be transferred, such payments to the Lockbox Account.
Payments received by the Seller with respect to Credit Card Timeshare Loans,
without regard to any discount fees, shall be transferred to the Lockbox Account
within five Business Days.
15
(j) The Seller will keep its principal place of business and chief
executive office and the office where it keeps its records concerning the
Timeshare Loans at the address of Bluegreen listed herein and shall notify the
parties hereto of any change to the same at least 30 days prior thereto.
(k) In the event that the Seller or the Depositor or any assignee of
the Depositor receives actual notice of any transfer taxes arising out of the
transfer, assignment and conveyance of a Timeshare Loan to the Depositor, on
written demand by the Depositor, or upon the Seller otherwise being given notice
thereof, the Seller shall pay, and otherwise indemnify and hold the Depositor,
or any subsequent assignee, harmless, on an after-tax basis, from and against
any and all such transfer taxes.
(l) The Seller authorizes the Depositor, the Issuer and the
Indenture Trustee to file continuation statements, and amendments thereto,
relating to the Timeshare Loans and all payments made with regard to the related
Timeshare Loans without the signature of the Seller where permitted by law. A
photocopy or other reproduction of this Agreement shall be sufficient as a
financing statement where permitted by law. The Depositor confirms that it is
not its present intention to file a photocopy or other reproduction of this
Agreement as a financing statement, but reserves the right to do so if, in its
good faith determination, there is at such time no reasonable alternative
remaining to it.
SECTION 8. Indemnification.
(a) The Seller agrees to indemnify the Depositor, the Issuer, the
Indenture Trustee, the Noteholders and the Initial Purchaser (collectively, the
"Indemnified Parties") against any and all claims, losses, liabilities,
(including reasonable legal fees and related costs) that the Depositor, the
Issuer, the Indenture Trustee, the Noteholders or the Initial Purchaser may
sustain directly related to any breach of the representations and warranties of
the Seller under Section 5 hereof (the "Indemnified Amounts") excluding, however
(i) Indemnified Amounts to the extent resulting from the gross negligence or
willful misconduct on the part of such Indemnified Party; (ii) any recourse for
any uncollectible Timeshare Loan not related to a breach of representation or
warranty; (iii) recourse to the Seller for a Defective Timeshare Loan so long as
the same is cured, substituted or repurchased pursuant to Section 6 hereof, (iv)
income, franchise or similar taxes by such Indemnified Party arising out of or
as a result of this Agreement or the transfer of the Timeshare Loans; (v)
Indemnified Amounts attributable to any violation by an Indemnified Party of any
Requirement of Law related to an Indemnified Party; or (vi) the operation or
administration of the Indemnified Party generally and not related to the
enforcement of this Agreement. The Seller shall (A) promptly notify the
Depositor and the Indenture Trustee if a claim is made by a third party with
respect to this Agreement or the Timeshare Loans, and relating to (i) the
failure by the Seller to perform its duties in accordance with the terms of this
Agreement or (ii) a breach of the Seller's representations, covenants and
warranties contained in this Agreement, (B) assume (with the consent of the
Depositor, the Issuer, the Indenture Trustee, the Noteholders or the Initial
Purchaser, as applicable, which consent shall not be unreasonably withheld) the
defense of any such claim and (C) pay all expenses in connection therewith,
including reasonable legal counsel fees and promptly pay, discharge and satisfy
any judgment, order or decree which may be entered against it or the
16
Depositor, the Issuer, the Indenture Trustee, the Noteholders or the Initial
Purchaser in respect of such claim. If the Seller shall have made any indemnity
payment pursuant to this Section 8 and the recipient thereafter collects from
another Person any amount relating to the matters covered by the foregoing
indemnity, the recipient shall promptly repay such amount to the Seller.
(b) The obligations of the Seller under this Section 8 to indemnify
the Depositor, the Issuer, the Indenture Trustee, the Noteholders and the
Initial Purchaser shall survive the termination of this Agreement and continue
until the Notes are paid in full or otherwise released or discharged.
SECTION 9. No Proceedings. The Seller hereby agrees that it will
not, directly or indirectly, institute, or cause to be instituted, or join any
Person in instituting, against the Depositor or any Association, any bankruptcy,
reorganization, arrangement, insolvency or liquidation proceedings, or other
proceedings under any federal or state bankruptcy or similar law so long as
there shall not have elapsed one year plus one day since the latest maturing
Notes issued by the Issuer.
SECTION 10. Notices, Etc. All notices and other communications
provided for hereunder shall, unless otherwise stated herein, be in writing and
mailed or telecommunicated, or delivered as to each party hereto, at its address
set forth below or at such other address as shall be designated by such party in
a written notice to the other parties hereto. All such notices and
communications shall not be effective until received by the party to whom such
notice or communication is addressed.
Seller
Bluegreen Corporation
0000 Xxxxxxxxxx Xxx Xxxxx, Xxxxx 000
Xxxx Xxxxx, Xxxxxxx 00000
Attention: Xxxxxxx X. Xxxxx, Senior Vice President, CFO & Treasurer
Telecopier: (000) 000-0000
Depositor
Bluegreen Receivables Finance Corporation XII
0000 Xxxxxxxxxxxxx Xxxxxx, Xxxxx 000
Xxxx Xxxxx, Xxxxxxx 00000
Attention: Xxxxx X. Xxxx, President & Assistant Treasurer
Telecopier: (000) 000-0000
SECTION 11. No Waiver; Remedies. No failure on the part of the
Seller, the Depositor or any assignee thereof to exercise, and no delay in
exercising, any right hereunder shall operate as a waiver thereof, nor shall any
single or partial exercise of any right hereunder preclude any other or further
exercise thereof or the exercise of any other right. The remedies herein
provided are cumulative and not exclusive of any other remedies provided by law.
17
SECTION 12. Binding Effect; Assignability. This Agreement shall be
binding upon and inure to the benefit of the Depositor and its respective
successors and assigns. Any assignee of the Depositor shall be an express third
party beneficiary of this Agreement, entitled to directly enforce this
Agreement. The Seller may not assign any of its rights and obligations hereunder
or any interest herein without the prior written consent of the Depositor and
any assignee thereof. The Depositor may, and intends to, assign all of its
rights hereunder to the Issuer and the Seller consents to any such assignment.
This Agreement shall create and constitute the continuing obligations of the
parties hereto in accordance with its terms, and shall remain in full force and
effect until its termination; provided, however, that the rights and remedies
with respect to any breach of any representation and warranty made by the Seller
pursuant to Section 5 and the repurchase or substitution and indemnification
obligations shall be continuing and shall survive any termination of this
Agreement but such rights and remedies may be enforced only by the Depositor,
the Issuer and the Indenture Trustee.
SECTION 13. Amendments; Consents and Waivers. No modification,
amendment or waiver of, or with respect to, any provision of this Agreement, and
all other agreements, instruments and documents delivered thereto, nor consent
to any departure by the Seller from any of the terms or conditions thereof shall
be effective unless it shall be in writing and signed by each of the parties
hereto, the written consent of the Indenture Trustee on behalf of the
Noteholders is given and confirmation from the Rating Agencies that such action
will not result in a downgrade, withdrawal or qualification of any rating
assigned to a Class of Notes is received. The Seller shall provide the Indenture
Trustee and the Rating Agencies with such proposed modifications, amendments or
waivers. Any waiver or consent shall be effective only in the specific instance
and for the purpose for which given. No consent to or demand by the Seller in
any case shall, in itself, entitle it to any other consent or further notice or
demand in similar or other circumstances. The Seller acknowledges that in
connection with the intended assignment by the Depositor of all of its right,
title and interest in and to each Timeshare Loan to the Issuer, the Issuer
intends to issue the Notes, the proceeds of which will be used by the Issuer to
purchase the Timeshare Loans from the Depositor under the terms of the Sale
Agreement.
SECTION 14. Severability. In case any provision in or obligation
under this Agreement shall be invalid, illegal or unenforceable in any
jurisdiction, the validity, legality and enforceability of the remaining
provisions or obligations, or of such provision or obligation, shall not in any
way be affected or impaired thereby in any other jurisdiction. Without limiting
the generality of the foregoing, in the event that a Governmental Authority
determines that the Depositor may not purchase or acquire Timeshare Loans, the
transactions evidenced hereby shall constitute a loan and not a purchase and
sale and contribution to capital, notwithstanding the otherwise applicable
intent of the parties hereto, and the Seller shall be deemed to have granted to
the Depositor as of the date hereof, a first priority perfected security
interest in all of the Seller's right, title and interest in, to and under such
Timeshare Loans and the related property as described in Section 2 hereof.
SECTION 15. GOVERNING LAW; CONSENT TO JURISDICTION.
(A) THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW
18
YORK WITHOUT GIVING EFFECT TO PRINCIPLES OF CONFLICTS OF LAW OTHER THAN
SECTIONS 5-1401 AND 5-1402 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF
NEW YORK.
(B) THE PARTIES TO THIS AGREEMENT HEREBY SUBMIT TO THE
NON-EXCLUSIVE JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK AND THE
UNITED STATES DISTRICT COURT LOCATED IN THE BOROUGH OF MANHATTAN IN NEW
YORK CITY AND EACH PARTY WAIVES PERSONAL SERVICE OF ANY AND ALL PROCESS
UPON IT AND CONSENTS THAT ALL SUCH SERVICE OF PROCESS BE MADE BY
REGISTERED MAIL DIRECTED TO ITS ADDRESS SET FORTH IN SECTION 10 HEREOF AND
SERVICE SO MADE SHALL BE DEEMED TO BE COMPLETED FIVE DAYS AFTER THE SAME
SHALL HAVE BEEN DEPOSITED IN THE U.S. MAILS, POSTAGE PREPAID. THE PARTIES
HERETO EACH WAIVES ANY OBJECTION BASED ON FORUM NON CONVENIENS, AND ANY
OBJECTION TO VENUE OF ANY ACTION INSTITUTED HEREUNDER AND CONSENTS TO THE
GRANTING OF SUCH LEGAL OR EQUITABLE RELIEF AS IS DEEMED APPROPRIATE BY THE
COURT. NOTHING IN THIS SECTION 15 SHALL AFFECT THE RIGHT OF THE PARTIES TO
THIS AGREEMENT TO SERVE LEGAL PROCESS IN ANY OTHER MANNER PERMITTED BY LAW
OR AFFECT THE RIGHT OF ANY OF THEM TO BRING ANY ACTION OR PROCEEDING IN
THE COURTS OF ANY OTHER JURISDICTION.
SECTION 16. WAIVERS OF JURY TRIAL. EACH OF THE PARTIES HERETO HEREBY
IRREVOCABLY AND UNCONDITIONALLY WAIVES, TO THE EXTENT PERMITTED BY APPLICABLE
LAW, ANY RIGHT IT MAY HAVE TO TRIAL BY JURY IN ANY LEGAL ACTION OR PROCEEDING
RELATING DIRECTLY OR INDIRECTLY TO THIS AGREEMENT OR ANY OTHER DOCUMENT OR
INSTRUMENT RELATED HERETO AND FOR ANY COUNTERCLAIM THEREIN.
SECTION 17. Heading. The headings herein are for purposes of
reference only and shall not otherwise affect the meaning or interpretation of
any provision hereof.
SECTION 18. Execution in Counterparts. This Agreement may be
executed by the parties hereto in separate counterparts, each of which when so
executed shall be deemed to be an original and both of which when taken together
shall constitute one and the same agreement.
19
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed by their respective officers thereunto duly authorized, as of the date
first above written.
Very truly yours,
BLUEGREEN RECEIVABLES FINANCE
CORPORATION XII, as Depositor
By:
-----------------------------------------------
Name: Xxxxx X. Xxxx
Title: President and Assistant Treasurer
BLUEGREEN CORPORATION, as Seller
By:
-----------------------------------------------
Name: Xxxxxxx X. Xxxxx
Title: Senior Vice President, CFO and Treasurer
Agreed and acknowledged as to
the last paragraph of Section 3
herein only:
BLUEGREEN VACATION CLUB TRUST
By: Vacation Trust, Inc., Individually and as Club Trustee
By:
---------------------------------------
Name:
Title:
[Signature Page to the Purchase and Contribution Agreement]
20
Schedule I
Representations and Warranties of the Seller Regarding the Timeshare Loans
With respect to each Timeshare Loan, as of the Closing Date or the related
Transfer Date, as applicable:
(a) other than certain 50/50 Loans, payments due under the Timeshare
Loan are fully-amortizing and payable in level monthly installments;
(b) the payment obligations under the Timeshare Loan bear a fixed rate
of interest;
(c) the Obligor thereunder has made a down payment by cash, check or
credit card of at least 10% of the actual purchase price (including
closing costs) of the Timeshare Property (which cash down payment
may, (i) in the case of Upgrade Club Loans, be represented in whole
or in part by the principal payments and down payment on such
timeshare loan since its date of origination and (ii) in the case of
a Sampler Converted Loan, be represented in whole or in part by the
principal payments and down payment made on the related Sampler Loan
since its date of origination) and no part of such payment has been
made or loaned to the Obligor by Bluegreen, the Seller or an
Affiliate thereof;
(d) as of the related Cut-Off Date, no principal or interest due with
respect to the Timeshare Loan is more than 60 days delinquent;
(e) the Obligor is not an Affiliate of Bluegreen or any Subsidiary;
provided, that solely for the purposes of this representation, a
relative of an employee and employees of Bluegreen or any Subsidiary
(or any of its Affiliates) shall not be deemed to be an "Affiliate";
(f) immediately prior to the conveyance of the Timeshare Loan to the
Depositor, the Seller will own full legal and equitable title to
such Timeshare Loan, and the Timeshare Loan (and the related
Timeshare Property) is free and clear of adverse claims, liens and
encumbrances and is not subject to claims of rescission, invalidity,
unenforceability, illegality, defense, offset, abatement,
diminution, recoupment, counterclaim or participation or ownership
interest in favor of any other Person;
(g) the Timeshare Loan (other than an Aruba Loan) is secured directly by
a first priority Mortgage on the related purchased Timeshare
Property;
(h) with respect to each Deeded Club Loan, the Timeshare Property
mortgaged by or at the direction of the related Obligor constitutes
a fractional fee simple timeshare interest in real property at the
related Resort that entitles the holder of the interest to the use
of a specific property for a specified number of days each year or
every other year, subject to the rules of the Bluegreen Vacation
Club; the related
I-1
Mortgage has been delivered for filing and recordation with all
appropriate governmental authorities in all jurisdictions in which
such Mortgage is required to be filed and recorded to create a
valid, binding and enforceable first Lien on the related Timeshare
Property and such Mortgage creates a valid, binding and enforceable
first Lien on the related Timeshare Property, subject only to
Permitted Liens; and the Seller is in compliance with any Permitted
Lien respecting the right to the use of such Timeshare Property; the
Assignment of Mortgage and each related endorsement of the related
Mortgage Note constitutes a duly executed, legal, valid, binding and
enforceable assignment or endorsement, as the case may be, of such
related Mortgage and related Mortgage Note, and all monies due or to
become due thereunder, and all proceeds thereof;
(i) with respect to the Obligor and a particular Timeshare Property
purchased by such Obligor, there is only one original Mortgage and
Mortgage Note, in the case of a Deeded Club Loan, and, only one
Finance Agreement or Owner Beneficiary Agreement, in the case of an
Aruba Loan; all parties to the related Mortgage and the related
Mortgage Note (and, in the case of an Aruba Loan, Finance Agreement
or Owner Beneficiary Agreement) had legal capacity to enter into
such Timeshare Loan Documents and to execute and deliver such
related Timeshare Loan Documents, and such related Timeshare Loan
Documents have been duly and properly executed by such parties; any
amendments to such related Timeshare Loan Documents required as a
result of any mergers involving the Seller or its predecessors, to
maintain the rights of the Seller or its predecessors thereunder as
a mortgagee (or a Seller, in the case of an Aruba Loan) have been
completed;
(j) at the time the related Originator originated such Timeshare Loan to
the related Obligor, such Originator had full power and authority to
originate such Timeshare Loan and the Obligor or the Club Trustee
had good and indefeasible fee title or good and marketable fee
simple title, or, in the case of an Aruba Loan, a cooperative
interest, as applicable, to the Timeshare Property related to such
Timeshare Loan, free and clear of all Liens, except for Permitted
Liens;
(k) the related Mortgage (or, in the case of an Aruba Loan, the related
Finance Agreement or Owner Beneficiary Agreement) contains customary
and enforceable provisions so as to render the rights and remedies
of the holder thereof adequate for the realization against the
related Timeshare Property of the benefits of the security interests
or lender's contractual rights intended to be provided thereby,
including (a) if the Mortgage is a deed of trust, by trustee's sale,
including power of sale, (b) otherwise by judicial foreclosure or
power of sale and/or (c) termination of the contract, retention of
Obligor deposits and payments towards the related Timeshare Loan by
the Originator or the lender, as the case may be, and expulsion from
the Bluegreen Vacation Club, Inc.; in the case of the Deeded Club
Loans, there is no exemption available to the related Obligor which
would interfere with the mortgagee's right to sell at a trustee's
sale or power of sale or right to foreclose such related Mortgage,
as applicable;
I-2
(l) the related Mortgage Note is not and has not been secured by any
collateral except the Lien of the related Mortgage;
(m) if a Mortgage secures a Timeshare Loan, the title to the related
Timeshare Property is insured (or a binding commitment, which may be
a blanket commitment, for title insurance, not subject to any
conditions other than standard conditions applicable to all binding
commitments, has been issued) under a mortgagee title insurance
policy issued by a title insurer qualified to do business in the
jurisdiction where the related Timeshare Property is located in a
form generally acceptable to prudent originators of similar mortgage
loans, insuring the Seller or its predecessor and its successors and
assigns, as to the first priority mortgage Lien of the related
Mortgage in an amount equal to the original outstanding Loan Balance
of such Timeshare Loan, and otherwise in form and substance
acceptable to the Indenture Trustee; the Seller or its assignees is
a named insured of such mortgagee's title insurance policy; such
mortgagee's title insurance policy is in full force and effect; no
claims have been made under such mortgagee's title insurance policy
and no prior holder of such Timeshare Loan has done or omitted to do
anything which would impair the coverage of such mortgagee's title
insurance policy; no premiums for such mortgagee's title insurance
policy, endorsements and all special endorsements are past due;
(n) the Seller has not taken (or omitted to take), and has no notice
that the related Obligor has taken (or omitted to take), any action
that would impair or invalidate the coverage provided by any hazard,
title or other insurance policy on the related Timeshare Property;
(o) all applicable intangible taxes and documentary stamp taxes were
paid as to the related Timeshare Loan;
(p) the proceeds of the Timeshare Loan have been fully disbursed, there
is no obligation to make future advances or to lend additional funds
under the originator's commitment or the documents and instruments
evidencing or securing the Timeshare Loan and no such advances or
loans have been made since the origination of the Timeshare Loan;
(q) the terms of each Timeshare Loan Document have not been impaired,
waived, altered or modified in any respect, except (x) by written
instruments which are part of the related Timeshare Loan Documents
or (y) in accordance with the Credit Policy, the Collection Policy
or the Servicing Standard (provided that no Timeshare Loan has been
impaired, waived, altered, or modified in any respect more than
once). No other instrument has been executed or agreed to which
would effect any such impairment, waiver, alteration or
modification; the Obligor has not been released from liability on or
with respect to the Timeshare Loan, in whole or in part; if required
by law or prudent originators of similar loans in the jurisdiction
where the related Timeshare Property is located, all waivers,
alterations and modifications have been filed and/or recorded in all
places necessary to perfect,
I-3
maintain and continue a valid first priority Lien of the related
Mortgage, subject only to Permitted Liens;
(r) other than if it is an Aruba Loan, the Timeshare Loan is principally
and directly secured by an interest in real property;
(s) the Timeshare Loan was originated by one of the Seller's Affiliates
in the normal course of its business; the Timeshare Loan originated
by the Seller's Affiliates was underwritten in accordance with its
underwriting guidelines and the Credit Policy; to the Seller's
Knowledge, the origination, servicing and collection practices used
by the Seller's Affiliates with respect to the Timeshare Loan have
been in all respects, legal, proper, prudent and customary;
(t) the related Timeshare Loan is assignable to and by the obligee and
its successors and assigns and the related Timeshare Property is
assignable upon liquidation of the related Timeshare Loan, without
the consent of any other Person (including any Association,
condominium association, homeowners' or timeshare association);
(u) the related Mortgage is and will be prior to any Lien on, or other
interests relating to, the related Timeshare Property;
(v) to the Seller's Knowledge, there are no delinquent or unpaid taxes,
ground rents (if any), water charges, sewer rents or assessments
outstanding with respect to any of the Timeshare Properties, nor any
other outstanding Liens or charges affecting the Timeshare
Properties that would result in the imposition of a Lien on the
Timeshare Property affecting the Lien of the related Mortgage or
otherwise materially affecting the interests of the Indenture
Trustee on behalf of the Noteholders in the related Timeshare Loan;
(w) other than with respect to delinquent payments of principal or
interest 60 or fewer days past due as of the Cut-Off Date, there is
no default, breach, violation or event of acceleration existing
under the Mortgage, the related Mortgage Note or any other document
or instrument evidencing, guaranteeing, insuring or otherwise
securing the related Timeshare Loan, and no event which, with the
lapse of time or with notice and the expiration of any grace or cure
period, would constitute a material default, breach, violation or
event of acceleration thereunder; and the Seller has not waived any
such material default, breach, violation or event of acceleration
under the Finance Agreement or Owner Beneficiary Agreement,
Mortgage, the Mortgage Note or any such other document or
instrument, as applicable;
(x) neither the Obligor nor any other Person has the right, by statute,
contract or otherwise, to seek the partition of the Timeshare
Property;
I-4
(y) the Timeshare Loan has not been satisfied, canceled, rescinded or
subordinated, in whole or in part; no portion of the Timeshare
Property has been released from the Lien of the related Mortgage, in
whole or in part; no instrument has been executed that would effect
any such satisfaction, cancellation, rescission, subordination or
release; the terms of the related Mortgage do not provide for a
release of any portion of the Timeshare Property from the Lien of
the related Mortgage except upon the payment of the Timeshare Loan
in full;
(z) the Seller and any of its Affiliates and, to the Seller's Knowledge,
each other party which has had an interest in the Timeshare Loan is
(or, during the period in which such party held and disposed of such
interest, was) in compliance with any and all applicable filing,
licensing and "doing business" requirements of the laws of the state
wherein the Timeshare Property is located to the extent necessary to
permit the Seller to maintain or defend actions or proceedings with
respect to the Timeshare Loan in all appropriate forums in such
state without any further act on the part of any such party;
(aa) there is no current obligation on the part of any other person
(including any buy down arrangement) to make payments on behalf of
the Obligor in respect of the Timeshare Loan;
(bb) the related Associations were duly organized and are validly
existing; a manager (the "Manager") manages such Resort and performs
services for the Associations, pursuant to an agreement between the
Manager and the respective Associations, such contract being in full
force and effect; to the Seller's Knowledge the Manager and the
Associations have performed in all material respects all obligations
under such agreement and are not in default under such agreement;
(cc) in the case of Bluegreen Owned Resorts (other than La Cabana Resort
and Casa del Mar Resort) and to the Seller's Knowledge with respect
to the Non-Bluegreen Owned Resorts, La Cabana Resort and Casa del
Mar Resort, (i) the related Resort is insured in the event of fire,
earthquake, or other casualty for the full replacement value
thereof, and in the event that the Timeshare Property should suffer
any loss covered by casualty or other insurance, upon receipt of any
insurance proceeds, the Associations at the Resorts are required,
during the time such Resort is covered by such insurance, under the
applicable governing instruments either to repair or rebuild the
portions of the Resort in which the Timeshare Property is located or
to pay such proceeds to the holders of any related Mortgage secured
by a Timeshare Property located at such Resort; (ii) the related
Resort, if located in a designated flood plain, maintains flood
insurance in an amount not less than the maximum level available
under the National Flood Insurance Act of 1968, as amended or any
applicable laws; (iii) the related Resort has business interruption
insurance and general liability insurance in such amounts generally
acceptable in the industry; and (iv) the related Resort's
I-5
insurance policies are in full force and effect with a generally
acceptable insurance carrier;
(dd) the obligee of each related Mortgage, and its successors and
assigns, has the right to receive and direct the application of
insurance and condemnation proceeds received in respect of the
related Timeshare Property, except where the related condominium
declarations, timeshare declarations, the Club Trust Agreement or
applicable state law provide that insurance and condemnation
proceeds be applied to restoration or replacement of the
improvements or acquisition of similar improvements, as the case may
be;
(ee) each rescission period applicable to the related Timeshare Loan has
expired;
(ff) no selection procedures were intentionally utilized by the Seller in
selecting the Timeshare Loan which the Seller knew were materially
adverse to the Depositor, the Indenture Trustee or the Noteholders;
(gg) the Units related to the Timeshare Loan in the related Resort have
been completed in all material respects as required by applicable
state and local laws, free of all defects that could give rise to
any claims by the related Obligors under home warranties or
applicable laws or regulations, whether or not such claims would
create valid offset rights under the law of the State in which the
Resort is located; to the extent required by applicable law, valid
certificates of occupancy for such Units have been issued and are
currently outstanding; the Seller or any of its Affiliates have
complied in all material respects with all obligations and duties
incumbent upon the developers under the related timeshare
declaration (each a "Declaration"), as applicable, or similar
applicable documents for the related Resort; no practice, procedure
or policy employed by the related Association in the conduct of its
business violates any law, regulation, judgment or agreement,
including, without limitation, those relating to zoning, building,
use and occupancy, fire, health, sanitation, air pollution,
ecological, environmental and toxic wastes, applicable to such
Association which, if enforced, would reasonably be expected to (a)
have a material adverse impact on such Association or the ability of
such Association to do business, (b) have a material adverse impact
on the financial condition of such Association, or (c) constitute
grounds for the revocation of any license, charter, permit or
registration which is material to the conduct of the business of
such Association; the related Resort and the present use thereof
does not violate any applicable environmental, zoning or building
laws, ordinances, rules or regulations of any governmental
authority, or any covenants or restrictions of record, so as to
materially adversely affect the value or use of such Resort or the
performance by the related Association of its obligations pursuant
to and as contemplated by the terms and provisions of the related
Declaration; there is no condition presently existing, and to the
Seller's Knowledge, no event has occurred or failed to occur prior
to the date hereof, concerning the related Resort relating to any
hazardous or toxic materials or condition, asbestos or other
environmental or similar matters which would
I-6
reasonably be expected to materially and adversely affect the
present use of such Resort or the financial condition or business
operations of the related Association, or the value of the Notes;
(hh) except if such Timeshare Loan is listed on Schedule II (hh) hereto,
the original Loan Balance of such Timeshare Loan does not exceed
$35,000;
(ii) payments with respect to the Timeshare Loan are to be in legal
tender of the United States;
(jj) all monthly payments (as applicable) made on the Timeshare Loan have
been made by the Obligor and not by the Seller or any Affiliate of
the Seller on the Obligor's behalf;
(kk) the Timeshare Loan relates to a Resort;
(ll) the Timeshare Loan constitutes either "chattel paper", a "general
intangible" or an "instrument" as defined in the UCC as in effect in
all applicable jurisdictions;
(mm) the sale, transfer and assignment of the Timeshare Loan and the
Related Security does not contravene or conflict with any law, rule
or regulation or any contractual or other restriction, limitation or
encumbrance, and the sale, transfer and assignment of the Timeshare
Loan and Related Security does not require the consent of the
Obligor;
(nn) each of the Timeshare Loan, the Related Security, related Assignment
of Mortgage, related Mortgage, related Mortgage Note, related
Finance Agreement or Owner Beneficiary Agreement (each as
applicable) and each other related Timeshare Loan Document are in
full force and effect, constitute the legal, valid and binding
obligation of the Obligor thereof enforceable against such Obligor
in accordance with its terms subject to the effect of bankruptcy,
fraudulent conveyance or transfer, insolvency, reorganization,
assignment, liquidation, conservatorship or moratorium, and is not
subject to any dispute, offset, counterclaim or defense whatsoever;
(oo) the Timeshare Loan relates to a Completed Unit; the Timeshare Loan
and the Related Security do not, and the origination of each
Timeshare Loan did not, contravene in any material respect any laws,
rules or regulations applicable thereto (including, without
limitation, laws, rules and regulations relating to usury, retail
installment sales, truth in lending, fair credit reporting, equal
credit opportunity, fair debt collection practices and privacy) and
with respect to which no party thereto has been or is in violation
of any such law, rule or regulation in any material respect if such
violation would impair the collectibility of such Timeshare Loan and
the Related Security; no Timeshare Loan was originated in, or is
subject to the laws of, any jurisdiction under which the sale,
transfer,
I-7
conveyance or assignment of such Timeshare Loan would be unlawful,
void or voidable;
(pp) to the Seller's Knowledge, (i) no bankruptcy is currently existing
with respect to the Obligor, (ii) the Obligor is not insolvent and
(iii) the Obligor is not an Affiliate of the Seller;
(qq) except if such Timeshare Loan is listed on Schedule II(qq) hereto,
the Timeshare Loan shall not have a Timeshare Loan Rate less than 6%
per annum;
(rr) except in the case of certain 50/50 Loans or an Upgrade Club Loan,
the Obligor has made at least one required payment with respect to
the Timeshare Loan (not including any down payment);
(ss) if a Resort (other than La Cabana Resort) is subject to a
construction loan, the construction lender shall have signed and
delivered a non-disturbance agreement (which may be contained in
such lender's mortgage) pursuant to which such construction lender
agrees not to foreclose on any Timeshare Properties relating to a
Timeshare Loan or by the terms of the construction loan, such
Timeshare Property has been released from the lien created thereby
which have been sold pursuant to this Agreement;
(tt) the Timeshare Properties and the related Resorts are free of
material damage and waste and are in good repair, ordinary wear and
tear excepted, and fully operational; there is no proceeding pending
or threatened for the total or partial condemnation of or affecting
any Timeshare Property or taking of the Timeshare Property by
eminent domain; the Timeshare Properties and the Resorts in which
the Timeshare Properties are located are lawfully used and occupied
under applicable law by the owner thereof;
(uu) the portions of the Resorts in which the Timeshare Properties are
located which represent the common facilities are free of material
damage and waste and are in good repair and condition, ordinary wear
and tear excepted;
(vv) no foreclosure or similar proceedings have been instituted and are
continuing with respect to any Timeshare Loan or the related
Timeshare Property;
(ww) with respect to the Aruba Loans only, Bluegreen shall own, directly
or indirectly, 100% of the economic and voting interests of the
Aruba Originator.;
(xx) the Timeshare Loan does not have an original term to maturity in
excess of 120 months;
(yy) to the Seller's Knowledge, the capital reserves and maintenance fee
levels of the Associations related to the Resorts are adequate in
light of the operating requirements of such Associations;
I-8
(zz) except as required by law, the Timeshare Loan may not be assumed
without the consent of the obligee;
(aaa) for each Club Loan, the Obligor under the Timeshare Loan does not
have its rights under the Club Trust Agreement suspended;
(bbb) the payments under the Timeshare Loan are not subject to withholding
taxes imposed by any foreign governments;
(ccc) each entry with respect to the Timeshare Loan as set forth on
Schedule II and Schedule III hereof is true and correct. Each entry
with respect to a Qualified Substitute Timeshare Loan as set forth
on Schedule II and Schedule III hereof, as revised, is true and
correct;
(ddd) if the Timeshare Loan relates to a Timeshare Property located in
Aruba, a notice has been mailed or will be mailed within 30 days of
the Closing Date or the related Transfer Date, as applicable, to the
related Obligor indicating that such Timeshare Loan has been
transferred to the Depositor and has ultimately been transferred to
the Issuer and pledged to the Indenture Trustee for the benefit of
the Noteholders;
(eee) no broker is, or will be, entitled to any commission or compensation
in connection with the transfer of the Timeshare Loans hereunder;
(fff) if the related Obligor is paying its scheduled payments by
pre-authorized debit or charge, such Obligor has executed an ACH
Form substantially in the form attached hereto as Exhibit C;
(ggg) the Timeshare Loan, if a Subsequent Timeshare Loan, when aggregated
with all Timeshare Loans sold to the Depositor pursuant to this
Agreement, satisfies the criteria for Subsequent Timeshare Loans
specified in Section 4.3 of the Indenture;
(hhh) if such Timeshare Loan is a 50/50 Loan, the related Obligor has made
a downpayment of at least 50%, the balance of the 50/50 Loan is due
no later than the one year anniversary of the origination date of
such 50/50 Loan and the coupon rate is at least 8.25% per annum;
(iii) if such Timeshare Loan relates to a Timeshare Property located in
the State of Michigan and was originated prior to Bluegreen
obtaining a license under the Michigan Mortgage Brokers, Lenders and
Servicers Licensing Act, Bluegreen shall have confirmed that the
interest rate on such Timeshare Loan is enforceable in the manner
specified as effective in an opinion by Michigan local counsel;
(jjj) if the Timeshare Loan is an Aruba Non-Club Loan, such Timeshare Loan
was originated prior to January 26, 2004; and
I-9
(kkk) if the Timeshare Loan is an Aruba Club Loan, such Timeshare Loan was
originated on or after January 26, 2004.
I-10
Schedule II
Exceptions
II-1
Schedule III
Schedule of Timeshare Loans
III-1
Schedule 5
The Tennessee Audit Division (the "Division") has advised Bluegreen that
rather than attempting to impose a sales tax on sales of vacation ownership
interests in Tennessee, it intends to seek to impose a sales tax on the use of
accommodations in Bluegreen's Tennessee properties by owners who became members
of Bluegreen Vacation Club through the purchase of non-Tennessee timeshare
interests. The Division has audited the period from December 1, 2001 through
December 21, 2004. Bluegreen has been advised verbally that the Division has
assessed sales taxes of approximately $650,000 for the period under audit for
transient use of Bluegreen Vacation Club properties. In the past, the timeshare
industry has been successful in avoiding the imposition by various states of
sales tax on the reservation and use of accommodations by timeshare owners.
Bluegreen intends to vigorously challenge the assessment of sales taxes by the
Division; however, there is no assurance that Bluegreen will be successful in
challenging the assessment.
Bluegreen Southwest One, L.P., ("Southwest"), a subsidiary of Bluegreen,
is the developer of the Mountain Lakes subdivision in Texas. One of the lakes
that is an amenity in the development has not filled to the expected level. This
condition has resulted in consumer complaints from property owners. Southwest is
investigating the causes for the failure of the lake to fill. Bluegreen is
unable to predict the results of this investigation, the potential cost to
correct the condition or the consequences in the event that the condition cannot
be corrected.
Also related to the Mountain Lakes subdivision is litigation related to
the development of mineral rights within the subdivision. In April 2006, in
Xxxxxx, et xx x. Bluegreen Southwest One, L.P. acting through its general
partner Bluegreen Southwest Land, Inc., et al, Cause No. 00000 Xxxxxxxx Xxxxx of
the 266th Judicial District, Erath County, Texas, plaintiffs filed a First
Amended Original Petition (April 2006). Pursuant to this First Amended Original
Petition, plaintiffs seek to develop mineral interests in the Mountain Lakes
subdivision and to recover damages from Southwest, alleging breach of contract,
breach of fiduciary duty, tortious interference with existing and prospective
relationships and intentional invasion or interference with property rights by
Southwest, for allegedly interfering with the development of mineral rights held
by plaintiffs. Plaintiffs' claims against Bluegreen Southwest One, L.P. total in
the aggregate $25 million. The property owners association has officially filed
a cross complaint against Bluegreen, Southwest and individual directors of the
property owners association asserting various tort claims. While no assurances
can be given with respect to the outcome of litigation, based on the information
currently available, Bluegreen believes that the claims lack merit and intends
to vigorously defend itself in this matter.
A number of shares of Bluegreen's publicly traded common stock was
recently acquired by Central Florida Investments, Inc., Xxxxx X. Xxxxxx and
Xxxxx X. Xxxxxx Revocable Trust (collectively, "CFI"). Bluegreen's Board of
Directors (the "Board"), after considering the best interests of the
corporation, adopted a shareholder rights plan. Bluegreen has initiated
litigation (i) challenging the manner in which the shares were acquired and (ii)
seeking a determination that the shareholder rights plan is valid and
enforceable. CFI has counterclaimed alleging breach of fiduciary duty.
Schedule 5
Exhibit A
Waiver Letter
Exhibit A
Exhibit B
Club Trust Agreement
Exhibit B
Exhibit C
ACH Form
Exhibit C
