EXHIBIT 10.8.2
LOAN AND SECURITY AGREEMENT
BETWEEN
CYPRESS POINTE RESORTS, L.P.
AND
GREYHOUND REAL ESTATE FINANCE COMPANY
DATED AS OF DECEMBER 19, 1991
LOAN AND SECURITY AGREEMENT
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BY THIS LOAN AND SECURITY AGREEMENT entered into as of December
19, 1991 between GREYHOUND REAL ESTATE FINANCE COMPANY, an Arizona
corporation ("Lender"), CYPRESS POINTE RESORTS, L.P., a Delaware limited
partnership ("Borrower"), hereby confirm and agree as follows:
ARTICLE I
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INTRODUCTION
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1.1 Borrower desires to obtain a revolving line of credit from
Lender, the proceeds of which shall be used for working capital purposes.
1.2 Lender is willing to extend to Borrower a revolving line of
credit for the purposes stated in the preceding paragraph upon the terms
and conditions set forth herein.
ARTICLE II
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DEFINITIONS
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Except where the context clearly requires a different interpretation,
all capitalized terms used in this Agreement shall have the meanings assigned to
them above, immediately below, or elsewhere herein.
2.1 "Advance" shall mean the monies or funds advanced from time
to time by Lender to Borrower in accordance with the terms and conditions
of this Agreement.
2.2 "Advance Date" shall mean each date on which an Advance is
made.
2.3 "Affiliate": any person or entity directly or indirectly
Controlling, Controlled by or under common Control with the person or
entity to whom the definition is applied, including blood relatives or
spouse of the person to whom the definition applies, if such person is a
natural person.
2.4 "Agreement" shall mean this Loan and Security Agreement, as
from time to time modified, extended, renewed, replaced or restated.
2.5 "Applicable Usury Law" shall mean the usury law applicable
pursuant to the terms of Article XI, paragraph 11.11 hereof or such other
usury law which is applicable if the law chosen by the parties is not
applicable.
2.6 "Assignments" shall mean written Assignments, in such form as
Lender shall prescribe, of specific Instruments and/or Purchaser Mortgages and
the proceeds thereof delivered to Lender concurrently with each Advance under
the terms of which Borrower transfers and assigns with full recourse all of
Borrower's right, title and interest in and to the Instrument and/or Purchaser
Mortgage, free and clear of all claims, demands, liens and encumbrances of third
parties, as collateral security for the Loan.
2.7 "Borrower" shall mean Cypress Pointe Resorts, L.P., a Delaware
limited partnership.
2.8 "Borrowing Base" shall mean an amount equal to the lesser of (i)
85% of the unpaid principal balance payable under the Eligible Instruments or
(ii) 85% of the then present value assigned to the unmatured installments of
principal and interest payable under the Eligible Instruments discounted at
Lender's Prevailing Discount Rate.
2.9 "Borrowing Term" shall mean the period of time during which
Lender is committed to make Advances under this Agreement, which commitment
shall terminate on the earlier of (i) the date which occurs twelve (12) months
after the date of the first Advance or (ii) March 30, 1993.
2.10 "Business Day" shall mean a calendar day other than a Saturday,
Sunday or legal holiday.
2.11 "Collection Agent" shall mean the entity designated as Collection
Agent in the Servicing and Collection Agreement, or, should such entity cease to
act as Collection Agent under the Servicing and Collection Agreement, such other
entity as Lender may appoint.
2.12 "Construction Loan" shall mean the loan made pursuant to the
Construction Loan Agreement.
2.13 "Construction Loan Agreement" shall mean that certain
Construction Loan Agreement of even date herewith, pursuant to which Lender has
agreed, subject to the terms and provisions thereof, to make a $5,250,000
construction loan to Borrower, in a principal amount not at any time exceeding
$3,500,000, the proceeds of which are to be used to construct the Project.
2.14 "Construction Loan Documents" shall have the meaning set forth in
the Construction Loan Agreement.
2.15 "Construction Mortgage" shall mean the Mortgage, Assignment of
Rents and Proceeds and Security Agreement delivered by Borrower pursuant to the
Construction Loan Agreement.
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2.16 "Control" shall mean the possession, directly or indirectly, of
the power to direct or cause the direction of the management or policies of
another person or entity by any means.
2.17 "Documents" shall mean this Agreement, the Note, the Guarantee,
the Assignments, the Servicing and Collection Agreement, the Subordination
Agreement, and each and every other document, instrument or writing executed or
delivered by Borrower to Lender in connection with the Loan.
2.18 "Eligible Instruments" shall mean the Instruments, each in
substantially the form of Exhibit "A" hereto, entered into by and between
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Borrower and those Persons who purchase a Time-Share Interest (at least 90% of
whom shall be United States or Canadian residents), which Eligible Instruments
shall conform to the criteria and standards set forth on Exhibit "B" hereto;
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provided, however, that an Instrument shall cease to be an Eligible Instrument
if (i) any installment payable thereunder becomes more than 59 days past due and
the Instrument under which such installment is payable is not replaced within
ninety (90) days following the due date of such installment or (ii) the contract
fails to continue to conform to the criteria and standards of Exhibit "B".
2.19 "Event of Default" has the meaning set forth in Article IX
hereof.
2.20 "Force Majeure" has the meaning set forth in Paragraph 9.2 of the
Construction Loan Agreement.
2.21 "Guarantee(s)" shall mean a written Guarantee & Subordination
Agreement, in such form as Lender shall prescribe, executed and delivered by a
Person (or Persons) to Lender, under the terms and conditions of which such
Person (or Persons), as Guarantor(s), shall individually and/or jointly and
severally guarantee Borrower's Performance of all of its Obligations under the
Documents and the Environmental Certificate (as defined in Article VI) and shall
agree to subordinate any indebtedness owed by Borrower to Guarantor(s) to the
Obligations owed by Borrower to Lender.
2.22 "Guarantor(s)" shall mean individually, a Person, and
collectively each and every Person, who executes and delivers to Lender a
Guarantee pursuant to the terms and conditions of this Agreement. The Guarantors
of this Loan are: Argosy Group, Inc., a Georgia corporation, and Argosy Canyon
Investments, L.P., a Delaware limited partnership.
2.23 "Impositions" shall mean any and all taxes (other than any tax
measured by net income payable by Lender to any state or political subdivision
thereof or to the U.S. under Section 11 or 1201 of the Internal Revenue Code, as
amended), in consequence of the receipt of payments provided for herein, license
fees, assessments, charges, fines, penalties, property, privilege, excise, real
estate or other taxes currently or hereafter levied or imposed by any state,
local or federal authority upon or in connection with or measured by the
Documents or the Receivables Collateral.
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2.24 "Instrument" shall mean a promissory note which has arisen out of
the sale of a Time-Share Interest by Borrower to a Purchaser, which note is
secured by a Purchaser Mortgage.
2.25 "Loan" shall mean the line of credit loan extended by Lender to
Borrower in accordance with the terms of this Agreement in a principal amount
not to exceed at any time outstanding the sum of Ten Million Dollars
($10,000,000.00).
2.26 "Lot Number 5" shall mean Xxx 0, Xxx Xxxxxxx xx Xxxxxxx Xxxxxx,
according to the plat thereof, recorded at Plat Book 23, pages 000 - 000, Xxxxxx
Xxxxxxx xx Xxxxxx Xxxxxx, Xxxxxxx, commonly known as the Blue Tree Resort.
2.27 "Maturity Date" shall mean that date which shall occur seven (7)
years after the date on which the last Advance is made under the terms of this
Agreement.
2.28 "Maximum Loan Amount" shall mean the sum of $10,000,000.00.
2.29 "Note" shall mean the Promissory Note, in the amount of the Loan,
to be made and delivered by Borrower to Lender pursuant to Article V, paragraph
5.2 hereof in the form of Exhibit "C" hereto (with all blanks appropriately
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filled in and dated as of the date the Loan is closed).
2.30 "Obligations" shall mean each and every obligation, duty,
covenant, undertaking and conditions which Borrower is required or has agreed to
perform under the Documents and under the Construction Loan Documents, and each
and every other obligation of Borrower now or hereafter owing to Lender.
2.31 "Opening Prepayment Date" shall mean the date which occurs
twenty-four (24) months after the last Advance hereunder.
2.32 "Overdue Rate" shall have the same meaning as set forth in the
Note.
2.33 "Perform, Performed or Performance" shall mean the timely,
faithful and complete payment and performance of all Obligations by Borrower.
2.34 "Permitted Encumbrances" shall mean each and every restriction,
reservation and easement of record and liens for taxes and assessments securing
amounts not yet due and payable, which individually and in the aggregate do not
render unmarketable the title to the property which they encumber, or liens
being contested in good faith by proceedings diligently contested, or any lien
against property to secure payment of all or a portion of the purchase price of
such property, and any encumbrance, lien or security interest described in
Exhibit "D" hereto.
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2.35 "Person" shall mean any adult individual, partnership,
corporation or other form of business entity whatsoever.
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2.36 "Present Value" shall mean with respect to any Eligible
Instrument the present value of the unmatured and unpaid installments of
principal and interest due thereunder, calculated using a discount rate equal to
the Prevailing Discount Rate applicable to said Eligible Instrument as provided
herein.
2.37 "Prevailing Discount Rate" shall mean Lender's prevailing
discount rate at the time each Advance is made, which rate shall be Prime Rate
plus 2% but in no event less than 13%.
2.38 "Prime Rate" shall mean the rate of interest publicly announced
from time to time by Citibank, N.A., New York, New York as its base rate of
interest charged to its most creditworthy commercial borrowers notwithstanding
the fact that some such borrowers may borrow at lower rates. The initial Prime
Rate shall be the rate in effect as of the first Business Day of the month of
the initial Advance and, subsequently, the Prime Rate shall be redetermined as
of the first Business Day of each month.
2.39 "Project" shall mean the time-share condominium project known as
Cypress Pointe Resort, to be constructed by Borrower in Orlando, Florida,
comprised of 48 timeshare units.
2.40 "Purchaser" shall mean a Person who purchases a Time-Share
Interest in the Project from Borrower.
2.41 "Purchaser Mortgage" shall mean the purchase money mortgage given
to secure an Instrument.
24.2 "Real Property" shall mean Lot 2, The Vinings at Cypress Pointe,
according to the plat thereof, recorded at Plat Book 23, pages 143-145, Public
Records of Orange County, Florida.
2.43 "Receivables Collateral" shall mean (i) all of the Instruments
which Borrower now or hereafter assigns, transfers, endorses or delivers to
Lender in consideration for an Advance made by Lender pursuant to the terms of
this Agreement and as collateral security for the Obligation; (ii) all Purchaser
Mortgages, purchase contracts, purchase agreements, guarantees and other
documents or instruments evidencing or securing the obligations of the
Purchasers and/or any other person primarily or secondarily liable on the
Instruments; (iii) all policies of insurance related to the Instruments or
delivered in connection with the Instruments; (iv) all rights under escrow
agreements relating to the Instruments and all impound and/or reserve accounts
related to the Instruments (excluding, however, any escrows set aside for
improvements to the Project); (v) all licenses, contracts, management contracts
or agreements, franchise agreements, permits, subordination or certificates now
or hereafter required or used in connection with the ownership, operation or
maintenance of the Project; (vi) all files, books and records pertaining to any
of the foregoing; and (vii) cash and non-cash proceeds from all of the
foregoing, including, without limitation, all goods, instruments. documents,
general
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intangibles, chattel paper and accounts wherever located, which have been
acquired with cash proceeds from any of the foregoing and the proceeds thereof.
2.44 "Residual Collateral" shall mean all of Borrower's right, title
and interest in and to any and all proceeds remaining following the foreclosure
or other realization by or on behalf of Lender of Lender's lien or security
interest in the Real Property and improvements thereon.
2.45 "Security Interest" shall mean a direct and exclusive first
security interest which has been perfected under the Uniform Commercial Code of
the state(s) in which any such security interest must be perfected; provided
that with respect to any portion of the Receivables Collateral not covered by
the Uniform Commercial Code, it shall mean a direct and exclusive first lien on
such property which has been perfected in the manner provided by law.
2.46 "Servicing Agent" shall mean the entity designated as Servicing
Agent in the Servicing and Collection Agreement, or, should such entity cease to
act as Servicing Agent under the Servicing and Collection Agreement, such other
entity as Lender may appoint.
2.47 "Servicing and Collection Agreement" shall mean the Servicing and
Collection Agreement, in such form as Lender shall prescribe, to be made among
Borrower, Lender, and the Servicing and Collection Agents pursuant to Article V,
paragraph 5.2 hereof, as from time to time modified, replaced or restated.
2.48 "TCR Encumbrance" shall mean that certain Mortgage and Security
Agreement bearing the date November 14, 1991 by Borrower in favor of TCR Orlando
III Limited Partnership, in the principal amount of $260,000.
2.49 "Subordination Agreement" shall mean an agreement, in such form
as Lender shall prescribe, delivered to Lender pursuant to paragraph 5.2(v)
hereof, as from time to time modified, replaced or restated.
2.50 "Term" shall mean the duration of this Agreement commencing as of
the year and day first above written and terminating on the date Borrower has
Performed all of its Obligations under the Documents.
2.51 "Time-Share Interest" shall mean the rights sold to a Purchaser
to the exclusive use of a Unit in the Project and the Project common areas for a
one (1) week period each year.
2.52 "Unit" shall mean a condominium unit in the Project as shown on
the recorded condominium plat therefor.
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ARTICLE III
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THE LOAN
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3.1 Lender hereby agrees that the Loan will be disbursed to Borrower,
from time to time, in periodic Advances, but in no event after the Borrowing
Term has expired, in amounts determined by subtracting from the Borrowing Base
the unpaid principal balance outstanding under the Loan at the time of each
Advance; provided that at no time shall the unpaid principal balance of the Loan
exceed the Maximum Loan Amount.
3.2 Advances shall not be made more frequently than once per month,
and each Advance shall be in an amount of not less than One Hundred Thousand
Dollars ($100,000.00).
3.3 The Loan is a revolving line of credit under the terms of which
Borrower, during the Borrowing Term, shall have the right to obtain Advances,
repay Advances, and obtain additional Advances so long as no Event of Default
has occurred and is continuing.
3.4 All Advances made pursuant to this Agreement shall be deemed to
be a single Loan.
3.5 No Advances will be made after the Borrowing Term has expired
unless Lender, in its sole discretion, shall agree in writing to make such
Advances.
3.6 Borrower shall use the proceeds of the Loan for working capital
purposes and to repay in full, the Construction Loan.
ARTICLE IV
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SECURITY FOR THE LOAN
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4.1 As security for Borrower's payment and Performance of all
Obligations owed to Lender, other than those arising out of the Environmental
Certificate with Representations, Covenants and Warranties delivered in
connection with the Construction Loan Agreement, Borrower hereby grants to
Lender a first and exclusive Security Interest in and to (i) the Receivables
Collateral assigned, transferred, endorsed or delivered to Lender under this
Agreement and (ii) the Residual Collateral. Lender's Security Interest in such
Receivables Collateral and the Residual Collateral shall be absolute, continuing
and applicable to all existing and future Advances and shall secure the
repayment of the Loan, the Construction Loan and the Performance of all
Obligations throughout the Term of the Loan. At the time each Advance is made
hereunder, Borrower shall deliver to Lender (i) an executed Assignment against
which an Advance is requested; (ii) the original of each Instrument; and (iii)
other documents which comprise such Eligible Instruments.
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4.2 If an Eligible Instrument which comprises a part of the
Receivables Collateral shall cease to qualify as an Eligible Instrument,
Borrower shall, within 30 days thereafter, pay to Lender an amount equal to that
portion of the Loan, together with interest, costs, and expenses, if any,
attributable to such ineligible Instrument or shall replace such ineligible
Instrument with another Eligible Instrument having a value of not less than that
portion of the Loan together with interest, costs, and expenses, if any,
attributable to the Eligible Instrument being replaced. No prepayment premium
shall be payable with respect to the payment to be made by Borrower pursuant to
the previous sentence as long as Borrower did not cause the Instrument to cease
qualifying as an Eligible Instrument. Concurrently with the delivery of the
replacement Eligible Instrument to Lender, Borrower shall deliver to Lender all
pertinent items (except for a "Request for Advance and Certification") which
Borrower is required to deliver to Lender in connection with an Advance pursuant
to Article V hereof, together with a Borrower's Certificate in form and
substance identical to Exhibit "E" hereto. Upon substitution of the replacement
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Eligible Instrument for the ineligible Instrument, Lender will terminate its
Security Interest in and reassign and endorse to Borrower, without recourse or
warranty of any kind, the replaced ineligible Instrument, together with the
Purchaser Mortgage securing the same, provided that no Event of Default, and no
act or event which after the giving of notice or the lapse of time (or both)
would constitute an Event of Default, has occurred and is continuing.
4.3 Reserved.
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4.4 Borrower shall, at its expense, deliver to Lender, at the time of
delivery of the Assignment, a policy or policies of title insurance insuring
Lender's interest in the Purchaser Mortgage which is the subject of the
Assignment. Such policy or policies shall be in the amount of the Advances made
against or, in the case of substitutions, a portion of the Loan attributable to
the Instruments secured by the insured Purchaser Mortgages and shall be issued
by a title insurer and be in form and substance satisfactory to Lender in its
sole discretion. The title insurance policies must reflect that the Purchaser
Mortgages constitute valid liens against the real property to which they pertain
subject only to the Permitted Encumbrances.
4.5 Borrower shall deliver or cause to be delivered to Lender, and
thereafter shall maintain in full force and effect according to the terms
thereof, Guarantees duly executed by the Guarantors identified in paragraph 2.17
hereof.
4.3 Reserved.
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ARTICLE V
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ADVANCES
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5.1 Lender shall have no obligation to make any Advance hereunder
until all conditions precedent set forth in the following paragraphs and
elsewhere in this
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Agreement have been satisfied, at Borrower's sole expense, as determined by
Lender in its reasonable discretion.
5.2 Borrower shall have delivered to Lender the following Documents,
duly executed in form and substance satisfactory to Lender (and, when required,
in recordable form):
(i) This Agreement;
(ii) The Note;
(iii) The Construction Loan Documents;
(iv) The Guarantees referred to in paragraph 2.16 hereof from
the Guarantors identified in paragraph 2.17 hereof;
(v) All documents required to effectuate the purposes of
paragraph 8.12 hereof;
(vi) The Servicing and Collection Agreement;
(vii) UCC Financing Statements for filing and recording, if
appropriate, as necessary to perfect Lender's Security Interest in the
Receivables Collateral and all other security for the Performance of
Borrower's Obligations which is subject to Article 9 of the Uniform
Commercial Code;
(viii)A favorable opinion from Borrower's independent counsel as
to such matters as Lender may reasonably require; and
(ix) A favorable opinion from each Guarantor's independent
counsel as to such matters as Lender may reasonably require.
5.3 Not less than five days before the date on which the initial
Advance is to be made, Borrower shall deliver or cause to be delivered to Lender
the following additional items:
(i) With respect to Borrower and each Guarantor or Person
which is a corporation or a general or limited partnership, certified
copies of their articles, certificates and agreements of general or limited
partnership or their articles of incorporation and by-laws (and all
amendments thereto), together with evidence that Borrower and each such
Guarantor or Person is duly organized, validly existing, and in good
standing under the laws of the jurisdiction in which they are organized,
and in each and every other jurisdiction where the nature of their
respective businesses require them to be so qualified;
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(ii) With respect to Borrower and each Guarantor or Person which
is a corporation or a general or limited partnership, a copy of the
resolutions certified to be true and complete by the corporate secretary or
all of the general partners (as the case may be), authorizing the
execution, delivery and performance of the Documents, and evidencing the
authority of all Persons executing the Documents on behalf of Borrower, the
Guarantor, and such other Persons, and if Borrower, Guarantor or such
Persons are operating under a fictitious name, a copy of the recorded
certificate of fictitious name;
(iii) A condominium map of the Project or other surveys and
certifications by surveyors or engineers acceptable to Lender, showing the
dimensions of the Units within the Project, access thereto, street lines,
easements and other details, together with other evidence satisfactory to
Lender that the Project complies with all applicable laws, rules and
regulations and public and private restrictions affecting the use of the
Project;
(iv) A copy of the registrations/consents to sell and the final
subdivision public reports/public offering statements/prospectuses and/or
approvals thereof required to be issued by or used in the State of Florida
and other jurisdictions where Time-Share Interests are or have been offered
or sold, together with all other approvals from regulatory agencies having
jurisdiction over the Project;
(v) If the Project has not been registered under such act, an
opinion from Borrower's counsel that the Project does not fall within the
purview of the Interstate Land Sales Full Disclosure Act;
(vi) A copy of the purchase contract, deed, note, mortgage/deed
of trust and other documents in existence, including, without limitation,
any covenants running with the land comprising the Project, as well as any
covenants enforceable as equitable servitudes, the Project management
agreement and advertising materials, which have been or are being used by
Borrower in connection with the Project or the sale of Time-Share Interests
therein;
(vii) Copies of the insurance policies required pursuant to
paragraph 8.9 hereof;
(viii)Evidence that the Project is not located within a "special
flood hazard" area as such term is used in the National Flood Insurance Act
of 1968, as amended and supplemented by the Flood Disaster Protection Act
of 1973, and in regulations, interpretations and rulings thereunder;
(ix) The items described in Exhibit "F" hereto;
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(x) Such other items as Lender requests which are
reasonably necessary to evaluate whether the request for the Advance
satisfied the requirements set forth herein;
(xi) Satisfactory judgment, UCC, litigation, tax lien
credit searches for Borrower, each Guarantor, Xxxx Xxxxxx, Xxxx
Xxxxxx and Xxxxxx & Xxxxx Company,
(xii) Satisfactory credit reports and personal credit
references for Xxxx Xxxxxx and Xxxx Xxxxxx;
(xiii) Copies of the forms of Instrument and Purchaser
Mortgage.
5.4 No material adverse change shall have occurred in the
Project or Borrower's or any Guarantor's business or financial condition since
the date of the latest financial and operating statements given to Lender by or
on behalf of Borrower or any Guarantor. Lender shall be satisfied (in Lender's
sole and absolute discretion) with the results of (i) Lender's physical
inspection of the Project and (ii) an environmental survey of the Project and,
if deemed necessary by Lender, a level one environmental assessment of the
Project to be obtained at Borrower's expense.
5.5 There shall have been no material adverse change in the
warranties and representations made by Borrower or any Guarantor in the
Documents.
5.6 Neither an Event of Default nor an act or event which
after notice or lapse of time would constitute an Event of Default shall have
occurred and be continuing.
5.7 The interest rate applicable to the Advance (before giving
effect to any savings clause) will not exceed the maximum contract rate
permitted by the Applicable Usury Law.
5.8 Borrower has paid to Lender all of the Commitment Fee for
the Loan required to be paid pursuant to paragraph 8.16 hereof.
5.9 The Construction Loan shall have closed on or before
February 13, 1992 and Borrower (i) shall have satisfied, on or before March 15,
1991 (subject to delays due to acts of Force Majeure), all of the conditions
precedent to the making of the first Subsequent Advance (as defined in the
Construction Loan Agreement) and (ii) shall have drawn the first Subsequent
Advance on or before July 1, 1992 (subject to delays due to acts of Force
Majeure).
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5.10 At Lender's request, the Construction Mortgage shall be amended
to secure all of Borrower's obligations under the Documents, in the same
priority as the first advance under the Construction Loan Agreement and Borrower
shall have provided to Lender, at Borrower's sole cost and expense, a title
insurance policy, acceptable to Lender, insuring Lender as to such priority.
5.11 Lender shall have no obligation to make any Advance until the
conditions specified in paragraphs 5.1 through 5.10 inclusive herein have been
satisfied as determined by Lender in its reasonable discretion. Without limiting
the generality of the foregoing, in the event the conditions specified in
Section 5.9 hereof have not been satisfied as determined by Lender in its
reasonable discretion, on or before the dates set forth therein, Lender shall
have no further obligation to make the Loan or the Construction Loan and the
entire Commitment Fee (as defined in Paragraph 8.16) shall nevertheless be
deemed earned by Lender in consideration for Lender's issuing of the Commitment
(as defined in Paragraph 8.16) and holding itself ready and willing to make the
Loan upon the terms and conditions set forth herein. Payment of the Commitment
Fee is in addition to Borrower's obligation under Paragraph 8.16.
5.12 Advances shall be requested in writing on the Request for Advance
and Certification, in the form of the attached Exhibit "F-1" executed by
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Borrower (or, if Borrower is a corporation or partnership, by those officers or
general partners, as the case may be, or agents of Borrower named in authorizing
resolutions of Borrower from time to time delivered to Lender and which are in
form and substance satisfactory to Lender).
5.13 Advances may be disbursed by checks, drafts or wire transfer
payable to Borrower; or, at the option of Lender after Borrower's written
request, to third parties, either severally or jointly with Borrower, for the
credit or benefit of Borrower. If Advances are made by wire transfer, Borrower
shall pay to Lender, Lender's usual and customary fee for wiring such funds.
Lender can withhold such fee from the Advance so made.
5.14 Although Lender shall have no obligation to make an Advance
unless and until all conditions thereto set forth herein have been satisfied,
Lender may, at its sole discretion, make Advances before that time without
waiving or releasing any of the Obligations, but Borrower shall continue to be
required to strictly Perform all such Obligations.
5.15 The proceeds of the Loan are to be used, in part, to pay and
satisfy in full the Construction Loan and all amounts due and owing to Lender
under the Construction Loan Documents. Therefore, Lender shall have the right to
disburse any Advance directly to Lender in payment or satisfaction of any
amounts then due to Lender under the Construction Loan Documents.
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ARTICLE VI
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RESERVED
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ARTICLE VII
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NOTE: MAINTENANCE OF BORROWING BASE;
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PAYMENTS: SERVICING AND COLLECTION
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7.1 The Loan shall be evidenced by the Note and shall be repaid in
immediately available funds according to the terms thereof and such provisions
of this Agreement as are applicable.
7.2 If for any reason the aggregate principal amount of the Loan
outstanding as of the last Business Day of any month shall exceed the then
Borrowing Base, Borrower, upon demand, shall immediately make to Lender a
principal payment in an amount equal to such excess plus accrued and unpaid
interest thereon.
7.3 Borrower is not entitled to prepay, in whole or in part, the Loan
until the Opening Prepayment Date. Thereafter, if (i) neither an Event of
Default nor an act or event that, with notice or lapse of time (or both) would
constitute an Event of Default, has occurred and is continuing; (ii) Borrower
has paid all sums due and payable to Lender in connection with the Loan, and
(iii) Borrower has given Lender at least 30 days prior written notice of the
prepayment and has paid to Lender at the time of prepayment a prepayment premium
equal to a percentage, as set forth below, of the then principal balance of the
Loan, then Borrower shall have the option to prepay the Loan in full, but not in
part, on any date an installment is due on the Note:
Period Premium
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Through the Second Anniversary Closed to Prepayment
Date of the last Advance
After the Second Anniversary Date 4%
and through the Fourth Anniversary
Date of the last Advance
After the Fourth Anniversary Date 3%
and through the Sixth Anniversary
Date of the last Advance
After the Sixth Anniversary Date 2%
and through the period ending 30 days
prior to the Seventh Anniversary Date
of the last Advance
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Within 30 days prior to the Seventh 0%
Anniversary Date of the last Advance
If there should occur an acceleration of maturity following an Event
of Default and such occurrence results in prepayment of the Loan, a prepayment
premium will be required in the amount specified above; or if occurring prior to
the Opening Prepayment Date, Borrower shall pay to Lender with the prepayment a
prepayment premium equal to 5% the then principal balance of the Loan being
prepaid. A Purchaser shall be permitted to prepay the amount owed on its
Instrument without penalty. If there should occur a casualty to or condemnation
of the Project and such occurrence results in a prepayment of the Loan, no
prepayment premium shall be payable in connection with such prepayment.
7.4 (a) Collection Agent, as agent for Lender, shall collect payments
on the Eligible Instruments used in making Borrowing Base computations or
otherwise constituting part of the Receivables Collateral and shall remit them
to Lender on the last Business Day of each and every month according to the
terms of the Servicing and Collection Agreement; and Borrower shall immediately
forward all such payments received by it to Collection Agent for Lender.
However, the Obligation to make, or any requirement that Lender receives,
payments called for in the Documents shall not be deemed satisfied until Lender
actually receives such payments from Collection Agent. For the purpose of
determining the adequacy of such payments, Borrower will cause Servicing Agent
to furnish to Lender at Borrower's sole cost and expense, no later than the
tenth day of each month commencing with the first full calendar month following
the first Advance, a report meeting the following requirements: (i) shows as of
the end of the prior month with respect to each Eligible Instrument which is
used in making Borrowing Base computations or otherwise constitutes part of the
Receivables Collateral (A) all payments received during the prior month on the
Eligible Instrument, allocated as between principal, interest, late charges,
taxes, and the like, (B) the opening and closing balances during the prior month
on each such Eligible Instrument, (C) present value of the cash flow (if
required by Lender) and (D) extensions, refinances, prepayments, and other
similar adjustments; and (ii) itemizes the Eligible Instrument which are used in
making Borrowing Base computations or otherwise constitute part of the
Receivables Collateral to show delinquencies of 30, 60, 90 and in excess of 90
days. On the basis of such reports, Lender will compute the amount, if any,
which was due and payable by Borrower on the last day of the preceding month and
will notify Borrower as soon as possible of any amount due. If such reports are
not timely received, Lender may estimate the amount which was due and payable;
and, in such event, Borrower shall pay upon demand the amount estimated by
Lender to be due and payable. If payment is made on the basis of Lender's
estimate, and reports required by this paragraph are thereafter received by
Lender, the estimated payment amount shall be adjusted by an additional payment
or a refund to the correct amount, as the reports may indicate; such additional
amount to be paid by Borrower upon demand and such refund to be made by Lender
within five Business Days after receipt by Lender of a written request therefor
by Borrower. In addition, at each calendar quarter, Borrower
- 14 -
shall deliver to Lender a current list of the names addresses and phone numbers
of the Purchasers related to Eligible Instruments.
(b) Lender, subject to any restriction contained in the Servicing
and Collection Agreement, any at any time and from time to time in its
discretion substitute a successor or successors to any Servicing or Collection
Agent acting under the Servicing and Collection Agreement if the Servicing or
Collection Agent is not satisfactorily performing its obligations thereunder.
7.5 Subject to Lender's rights upon the occurrence of an Event of
Default, all proceeds from the Receivables Collateral (except payments which are
identified by Purchasers as tax or maintenance and other assessment payments and
are required to be so treated by Borrower) during the Term hereof shall be
applied first to the payment of all costs, fees and expenses required by the
Documents to be paid by Borrower, second to accrued and unpaid interest due on
the Note, third to the unpaid principal balance of the Note, and then to the
other Obligations in such order and manner as Lender may determine. Unless and
until all such Obligations have been Performed, Borrower shall have no right to
any portion of the proceeds of the Receivables Collateral.
7.6 Whether or not the proceeds from the Receivables Collateral shall
be sufficient for that purpose, Borrower shall pay when due all payments
required to be made pursuant to the Note and other Documents; and any and all
amounts payable by Borrower under the Note and other Documents shall be paid
without notice (except as otherwise expressly provided therein), demand,
counterclaim, set-off, deduction, recoupment or defense, and without abatement,
suspension, deferment, diminution or proration by reason of any circumstance or
occurrence whatsoever, Borrower's Obligation to make such payments being
absolute and unconditional.
7.7 All payments to be made by Borrower under the Documents shall be
free of expense to Lender with respect to the amount of any Impositions, all of
which Impositions Borrower assumes and shall pay on demand in addition to the
other payments provided for in the Documents to be made by it. Borrower's
Obligation to pay Impositions shall likewise include the Obligation to pay any
increase to Lender in federal, state, or local income tax as a result of
inclusion in income of Lender of any amount required by this paragraph to be
paid to or for Lender.
ARTICLE VIII
------------
BORROWER'S ADDITIONAL REPRESENTATIONS.
--------------------------------------
WARRANTIES AND COVENANTS
------------------------
8.1 (a) Borrower is, and will continue to be during the Term hereof, a
limited partnership duly organized, validly existing and in good standing under
the laws of the State of Delaware and is, and will continue to be during the
Term hereof, qualified to do business and in good standing in each jurisdiction
in which it is selling Time-Share
- 15 -
Interests or where the location or nature of its properties or business makes
such qualification necessary (except where failure to do so would not adversely
affect Lender's ability to realize upon the Receivables Collateral or any other
security for the Performance of the Obligations or materially adversely affect
the business or financial condition of Borrower or the ability of Borrower to
complete Performance of the Obligations). Borrower has, and will continue to
have, powers adequate for making and Performing under the Documents, for
undertaking and Performing the Obligations, and for carrying on its business and
owning its property. Argosy Group, Inc. ("Argosy Group") is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Georgia. Argosy Canyon Investments, L.P. ("Argosy Canyon") is a limited
partnership duly organized, validly existing and in good standing under the laws
of the State of California. Argosy Group is, and will continue during the Term
hereof, qualified to do business and in good standing in each jurisdiction where
Borrower is selling Time-Share Interests or where the location or nature of the
properties or business of Argosy Group make such qualification necessary (except
where failure to do so would not adversely affect Lender's ability to realize
upon the Receivables Collateral or any other security for the Performance of the
Obligations or materially adversely affect the business or financial condition
of Borrower or the ability of Borrower to complete Performance of the
Obligations). The sole general partner of Argosy Canyon is CanPartners
Incorporated, a California corporation. The sole limited partners of Argosy
Canyon are CanPartners Investment Partners II, L.P., a California limited
partnership, and Argosy Investments, Inc., a Georgia corporation.
(b) Borrower has good right and power to grant the Security
Interest in the Receivables Collateral and to execute and deliver this Agreement
and the other Documents and to Perform the Obligations. All action necessary and
required by Borrower's organization documents and all applicable laws for the
obtaining of the Loan and for the execution and delivery of this Agreement and
all other Documents executed and delivered in connection with the Loan has been
duly and effectively taken; and, to the best of Borrower's knowledge, this
Agreement is and shall be, and all other Documents are and shall be, legal,
valid, binding and enforceable against Borrower in accordance with their
respective terms, other than as such enforceability may be limited by
bankruptcy, insolvency, reorganization, arrangement, moratorium, or similar laws
relating to or affecting the rights of creditors generally or general principles
of equity (except to the extent that such laws, rights, remedies or principles
are waivable by Borrower and have been waived in the Documents). To the best of
Borrower's knowledge, the Documents do not violate the Applicable Usury Law or
any other usury law known to Borrower. The execution, delivery and Performance
of the provisions of this Agreement and all the other Documents will not
violate, constitute a default under, or result in the creation or imposition of
any lien, charge or encumbrance upon any of the properties or assets of Borrower
pursuant to any provision of: any law, regulation, judgment, decree, order,
franchise or permit applicable to Borrower; Borrower's charter documents; or any
contract or other agreement or instrument to which Borrower is a party or by
which Borrower or Borrower's properties or assets are bound. No consent of any
government or agency thereof, or any other person, firm or entity not a party
hereto, is or will be required as a condition to the execution, delivery,
Performance or enforceability of the Documents.
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8.2 (a) There is no action, litigation or other proceeding pending
(or, to Borrower's knowledge, threatened) before any arbitration tribunal,
court, governmental agency or administrative body against Borrower which, if
adversely determined, might adversely affect Lender's ability to realize upon
the Receivables Collateral or any other security for the Performance of the
Obligations, or materially adversely affect the Project, the business or
financial condition of Borrower, or the ability of Borrower to complete
Performance of the Obligations; or which questions the validity of the
Documents.
(b) If Borrower or a Guarantor becomes a party to any action,
litigation or other proceeding which asserts a material claim against Borrower
or a Guarantor, or Borrower becomes the subject of an investigation by a
governmental agency or administrative body with respect to the Project, then
Borrower shall within 10 days after it obtains knowledge thereof notify Lender
of such action, litigation, proceeding or investigation and the particulars
thereof. Thereafter, if requested by Lender, Borrower shall report to Lender
with respect to the status of such matter and the particulars thereof.
8.3 (a) Except as set forth in Exhibit "G" hereto, Borrower has sold
-----------
or has offered for sale Time-Share Interests which generate Eligible Instruments
only in the State of Florida and all sales have been made at the Project or in
the private residences of potential Purchasers. Before it sells or offers for
sale Time-Share Interests outside the State of Florida and those listed in
Exhibit "G" hereto, Borrower shall promptly notify Lender and provide Lender
-----------
with evidence that Borrower has complied with all laws of such jurisdiction
governing the proposed conduct of Borrower.
(b) Except for violations which do not individually or in the
aggregate affect Lender's ability to realize upon the Receivables Collateral or
any other security for the Performance of the Obligations or do not materially
adversely affect the business or financial condition of Borrower or the ability
of Borrower to complete Performance of the Obligations, Borrower has complied,
and will comply, with all laws and regulations of the United States and every
state, county and municipal jurisdiction in which Time-Share Interests have been
sold or offered for sale.
(c) Without limiting the generality of any other representation
or warranty contained herein, Borrower will not violate any private covenant or
restriction or any zoning, use or similar law, ordinance or regulation affecting
the use or occupancy of the Project, the violation of which could have a
material adverse effect on Lender's ability to realize upon the Receivables
Collateral or any other security for the Performance of the Obligations or
materially adversely affect the business or financial condition of the Borrower
or the ability of Borrower to complete Performance of the Obligations.
8.4 (a) Each Instrument at the time it is assigned to Lender in
connection with the Loan and this Agreement shall be an Eligible Instrument. At
the time such Instrument is assigned to Lender, Borrower shall have performed
all of its obligations to Purchasers, and there shall be no executory
obligations to Purchasers to be Performed by
- 17 -
Borrower. Borrower further warrants and guarantees the value and enforceability
of the Receivables Collateral.
(b) Borrower shall not, without the prior written consent of
Lender, cancel or materially modify, or consent to or acquiesce in any material
modification to, or solicit the prepayment of, any Eligible Instrument used in
making Borrowing Base computations or which otherwise constitutes part of the
Receivables Collateral; or waive the timely performance of the obligations of
the Purchaser thereunder. Borrower shall not pay or advance directly or
indirectly for the account of any Purchaser any sum owing by the Purchaser under
any of the Eligible Instruments used in making Borrowing Base computations or
which otherwise constitute part of the Receivables Collateral.
(c) Borrower at all times shall fulfill, and cause its affiliates,
agents and independent contractors at all times to fulfill, all obligations to
Purchasers under all Eligible Instruments which are used in making Borrowing
Base computations or otherwise constitute part of the Receivables Collateral.
(d) True and complete copies of the Project governing documents,
the purchase contract, deed, note, mortgage/deed of trust, the Instruments,
advertising materials and other documents and exhibits thereto which have been
and are being used by Borrower in connection with the Project and the sale or
offering for sale of Time-Share Interests therein have been delivered to Lender.
Such documents are the only ones which have been used in connection with the
Project and the sale of Time-Share Interests therein. Borrower shall not,
without the prior written consent of Lender, cancel or materially modify any
such documents, which consent will not be unreasonably withheld. Borrower shall
Perform all of its obligations under the Project governing documents.
(e) All roads and other offsite improvements contained within the
Project will have been dedicated to and accepted by the responsible governmental
authority or utility prior to the initial Advance. Borrower shall maintain or
cause to be maintained in good condition and repair all amenities and common
areas which have been promised or represented as being available to Purchasers
and all roads and off-site improvements which have not been dedicated to or
accepted by the responsible governmental authority or utility.
(f) Each Purchaser shall automatically be a member of the
Project's owners association or associations, if any, and shall be entitled to
vote on the affairs thereof (subject, however, to any preferential voting rights
in favor of Borrower as permitted under Florida time-share laws). Each such
owners association shall be governed by a Board of Directors, which have the
authority to fix and levy prorata upon each Purchaser annual assessments to
cover the costs of maintaining and operating the Project (including, without
limitation, taxes and assessments not levied by the appropriate taxing authority
directly against owners of Time-Share Interests) and to establish a reasonable
reserve for improvements, the replacement of Items and furnishings, and
contingencies. If Borrower controls an owners association, Borrower will while
it controls such association:
- 18 -
(i) cause such owners association to (A) discharge timely and completely its
obligations under the Project governing documents and maintain the reserve
described above; and (ii) pay to such owners association not less often than
every twelve months hereafter the difference between (A) the cumulative total
amount of the maintenance and operating expenses incurred by such association,
together with the amount of any installment of real property taxes currently due
and payable with respect to the Project not directly levied against owners of
Time-Share Interests, through the end of the calendar month preceding the month
in which such payment is made and (B) the cumulative total amount of assessments
(less amounts thereof allocated to reserve expenses) payable to the association
by Time-Share Interest owners other than Borrower through the end of the
calendar month preceding the month in which such payment is made.
(g) Except as otherwise permitted by the Project governing
documents, the Project owners association or the owners of Time-Share Interests
in common shall own the furnishings in the Project Units and all the common
areas in the Project and other amenities which have been promised or represented
as being available to Purchasers, free and clear of liens and security
interests, except for the Permitted Encumbrances; and no part of the Project is
subject to partition by owners of Time-Share Interests. Borrower will maintain
or cause to be maintained in good condition and repair all common areas in the
Project and other amenities which have been promised or represented as being
available to Purchasers and which are not the responsibility of the Project
owners association to maintain and repair. Borrower will maintain a reasonable
reserve to assure compliance of the terms of the foregoing sentence.
(h) The common areas and amenities appurtenant to sold Time-Share
Interests, and the streets and other offsite improvements contained within the
Project are free and clear of all liens or other encumbrances of third parties,
subject to the Permitted Encumbrances. The remaining portions of the common
areas and amenities are free and clear of all liens or other encumbrances of
third parties, subject to the Permitted Encumbrances and the TCR Encumbrance.
Borrower agrees that such common areas, amenities, streets and other offsite
improvements will not, during the Term hereof, be encumbered unless the holder
of such encumbrance agrees that the Purchasers shall have uninterrupted use of
all such areas, amenities, streets and improvements, notwithstanding a
foreclosure or other realization of such encumbrance.
8.5 LENDER DOES NOT ASSUME AND SHALL HAVE NO RESPONSIBILITY,
OBLIGATION OR LIABILITY TO PURCHASERS, LENDER'S RELATIONSHIP BEING SOLELY THAT
OF A CREDITOR WHO HAS TAKEN, AS SECURITY FOR INDEBTEDNESS OWED TO IT, A
COLLATERAL ASSIGNMENT FROM BORROWER OF INSTRUMENTS. EXCEPT AS REQUIRED BY LAW,
BORROWER SHALL NOT, AT ANY TIME, USE THE NAME OF OR MAKE REFERENCE TO LENDER
WITH RESPECT TO THE PROJECT, THE SALE OF TIME-SHARE INTERESTS OR OTHERWISE,
WITHOUT THE EXPRESS WRITTEN CONSENT OF LENDER.
- 19 -
8.6 Borrower shall undertake the collection of amount delinquent under
each Eligible Instrument which is used in making Borrowing Base computations or
otherwise constitutes part of the Receivables Collateral, shall bear the entire
expense of such collection work, and shall diligently and timely do such work
respecting collection, including forfeiture or foreclosure proceedings. Lender
shall have no obligation to undertake any collection, eviction or foreclosure
action against the obligor under any Eligible Instrument or to otherwise realize
upon any Eligible Instrument.
8.7 Borrower shall maintain in a secure place in its offices at the
address specified below proper and accurate books, records, ledgers,
correspondence and other papers relating to the Receivables Collateral. Lender
may notify the appropriate Purchasers of the existence of Lender's interest as
assignee in the Receivables Collateral and request from such Purchasers any
information relating to the Receivables Collateral. Borrower shall cooperate
with Lender in giving such notice and will do so under its letterhead if
requested. Borrower's chief executive office is as set forth on the signature
page of this Agreement. Borrower will not change its chief executive office
without giving Lender thirty (30) days prior written notice of such contemplated
change. Borrower has not operated under any names or fictitious names other than
Cypress Pointe Resort during the previous six (6) years. Borrower will not
change its name or operate under any fictitious names without first giving
Lender thirty (30) days prior written notice.
8.8 Borrower shall not, without the prior written consent of Lender:
(i) sell, convey, pledge, hypothecate, encumber or otherwise transfer any
security for the Performance of the Obligations; or (ii) permit or suffer to
exist any liens, security interests or other encumbrances on any security for
the Performance of the Obligations, except with respect to either (i) or (ii)
for the Permitted Encumbrances and liens and security interests expressly
granted to Lender.
8.9 Borrower shall obtain before funding, and shall maintain during
the Term of the Loan, such insurance, written by such insurers, and in such
forms and such amounts, as Lender may reasonably require.
8.10 (a) This Agreement and the other Documents, certificates,
financial statements, tax returns (including without limitation, the tax returns
of Borrower and Guarantors) and written materials furnished to Lender by or on
behalf of Borrower in connection with the transactions contemplated herein do
not contain any untrue statement of a material fact or omit to state a material
fact necessary in order to make the statements contained herein and therein not
misleading. There is no fact known to Borrower which materially adversely
affects or in the future may (so far as Borrower can now foresee) materially
adversely affect the Receivables Collateral or any other security for the
Performance of the Obligations or the business or financial condition of
Borrower or the Project which has not been set forth in this Agreement or the
other Documents, certificates, financial statements or written materials
furnished to Lender in connection with the transactions contemplated herein.
- 20 -
(b) The fact that Lender's representatives may have made
certain examinations and inspections or received certain information pertaining
to the Receivables Collateral or the Project and the proposed operation thereof
does not in any way affect or reduce the full scope and protection of the
warranties, representations and Obligations contained herein, which have induced
Lender to enter into this Agreement.
8.11 (a) Borrower shall maintain a standard, modern system of
accounting and shall keep and maintain all books and records in accordance with
generally accepted accounting principles on a consistent basis.
(b) On or before the tenth day of each month, Borrower shall
furnish or cause to be furnished to Lender (i) the reports of the Servicing
Agent and Borrower required pursuant to paragraph 7.4, hereof and (ii) a sales
report for the prior month showing the number of sales of Time-Share Interests
and the aggregate dollar amount thereof, including down payments.
(c) Borrower shall furnish or cause to be furnished to Lender,
as soon as the same are available, and in any event within 120 days of each
fiscal year and within 60 days of each interim quarterly fiscal period of
Borrower, a copy of the current financial statements of Borrower, and within 90
days at the end of each fiscal year and within 60 days of each interim quarterly
fiscal period of the subject, current financial statements of each Guarantor and
the Project's owners association (the "Association"). Such financial statements
shall contain a balance sheet as of the end of the relevant fiscal period and
statements of income and cash flows for such fiscal period (together, in each
case, with the comparable figures for the corresponding period of the previous
fiscal year, if available), all in reasonable detail, prepared in accordance
with generally accepted accounting principles consistently applied throughout
the period involved and with prior periods. All annual financial statements of
Borrower and the Association required pursuant hereto shall be audited by a
certified public accountant, and shall be certified to by said certified public
accountant. All annual financial statements of Guarantor shall be compiled by a
certified public account. In addition to the foregoing, all financial statements
required pursuant hereto shall be certified correct by the individual who is the
subject of such statements or, the chief financial officer or general partner,
as the case may be, of the subject of such statements. The financial statements
of Borrower shall also contain in reasonable detail a statement of income and
expenses covering the operation of the Project. Together with such financial
statements, Borrower shall deliver to Lender a certificate signed by the chief
financial officer or managing general partner, as the case may be, of Borrower
stating that, to the best of its knowledge after inquiry, there exists no Event
of Default and no condition, event or act, which with notice or lapse of time or
both, would become an Event of Default or, if any such Event of Default or any
such condition, event or act exists, specifying the nature and period of
existence thereof and what action Borrower proposes to take with respect
thereto.
(d) Borrower shall deliver to Lender from time to time, as
available, and promptly upon amendment or effective date, current price lists,
sales
- 21 -
literature, registrations/consents to sell, final public reports/public offering
statements/prospectuses, and other items requested by Lender which relate to the
Project.
(e) So long as the same shall be pertinent to the Loan, the
Project, the documents or any transactions contemplated therein, Borrower shall
at its expense (i) permit Lender and its representatives at all reasonable times
to inspect, audit and copy, as appropriate, the Project, Borrower's facilities,
activities, books of account, logs and records; (ii) cause its employees, agents
and accountants to give their full cooperation and assistance in connection with
any such visits of inspection or financial conferences; and (iii) make available
such further information concerning its business and affairs as Lender may from
time to time reasonably request.
(f) Borrower shall annually submit to Lender within 45 days
after each is available proposed annual maintenance and operating budgets for
the Project, certified to be adequate by Borrower and a statement of the annual
assessment to be levied upon the Purchasers.
(g) Borrower shall cause to be delivered to Lender as soon as
available, and in any event no later than forty-five (45) days following its
filing with the Internal Revenue Service, the signed income tax returns for each
Guarantor for the fiscal year then ended, as filed with the Internal Revenue
Service, together with all schedules thereto; provided, that in the event a
Guarantor obtains an extension of the date for filing such tax returns, Borrower
shall cause to be delivered to Lender a signed copy of such extension within
fifteen (15) days following the filing deadline for such return in the absence
of such extension.
8.12 Borrower shall cause any and all indebtedness owed by it to its
partners or officers, the Guarantor, or the relatives and affiliates of Borrower
or the foregoing, to be subordinated to the Obligations pursuant to
subordination agreements satisfactory to Lender in form and substance.
8.13 Borrower shall not, without Lender's prior written consent: (i)
(other than the sale of Time-Share Interests in the ordinary course of
Borrower's business or the rental of condominium units in the Project in the
ordinary course of Borrower's business) sell, lease, transfer or dispose of its
all or substantially all of its assets to another entity; or (ii) dissolve or
liquidate, or merge or consolidate with or into any other entity, transfer to
any person or entity, the right to control, Borrower, Argosy Group or Argosy
Canyon, turn over the management or operation of Borrower, Argosy Group or
Argosy Canyon to any other person or entity, or permit any of the foregoing to
occur with respect to Borrower, Argosy Group or Argosy Canyon.
8.14 Borrower is not in default of any payment on account of
indebtedness for borrowed money or of any repurchase obligations in connection
with a receivables purchase financing, or in violation of or in default under
any material term in any agreement, instrument, order, decree or judgment of any
court, arbitration or governmental authority to which it is a part or by which
it is bound.
- 22 -
8.15 Borrower has filed all tax returns and paid all taxes,
assessments, levies and penalties, if any, in respect thereof required to be
filed by it or paid by it to any governmental or quasi-governmental authority.
All real estate taxes and assessments have been paid which are due and owing in
connection with the common areas and the Project and other amenities which have
been promised or represented as being available to Purchasers for use by them.
Borrower shall use its best efforts to provide to Lender not more than 30 days
after such taxes and assessments would become delinquent if not paid evidence
that all taxes and assessments on the Project and common areas have been paid in
full.
8.16 Borrower shall pay to Lender on demand all reasonable out-of-
pocket costs and expenses incurred or to be incurred by Lender or its counsel in
connection with the initiation, documentation and closing of the Loan, the
making of Advances hereunder, the protection of the security for the Performance
of the Obligations, or the enforcement of the Obligations against Borrower or
any Guarantor (including, without limitation, travel costs, a non-refundable
documentation fee of $25,000.00 (which documentation fee shall be credited
against Lender's attorneys' fees), all attorneys' fees, any brokerage or similar
fees, all filing and recording fees, all charges for consumer credit reports and
UCC, tax lien, judgment and litigation searches, all revenue and documentary
stamp and intangible taxes, and all fees and expenses of the Servicing and
Collection Agents to perform the services contemplated hereunder and under the
terms of the Servicing and Collection Agreement). Borrower shall pay to Lender a
non-refundable commitment fee (the "Commitment Fee") in the amount of One
Hundred Thousand Dollars and NO/100 ($100,000.00), which fee was earned by
Lender upon issuance by Lender to Borrower of the Commitment Letter (the
"Commitment") in connection with the Loan, dated November 18, 1991, in
consideration of Lender holding itself ready, willing and able to make the Loan
upon the terms and conditions set forth herein. The Commitment Fee shall be due
and payable in full not later than the closing of the Construction Loan or
February 15, 1992, whichever occurs first. The payment of the Commitment Fee is
in addition to Borrower's obligation to pay a commitment fee under the
Construction Loan Agreement. Lender acknowledges the receipt of a $2,500
application fee which has been earned by Lender and shall not be applied against
the Commitment Fee. Lender shall act as custodian for purposes of holding
Eligible Instruments and Borrower shall pay to Lender on demand, a custodian fee
of Ten Dollars ($10.00) for each Eligible Instrument so held by Lender,
exclusive of Eligible Instruments that are substituted for ineligible
Instruments (provided that such custodian fee was paid in connection with such
ineligible Instrument) and exclusive of Instruments that have been cancelled by
the Purchaser or the Borrower. Notwithstanding the foregoing, Borrower shall
have the right to select an independent custodian to hold Eligible Instruments
on Lender's behalf and as Lender's agent, so long as (i) Borrower pays all costs
charged by such independent custodian, and (ii) such independent custodian is
approved in advance, in writing by Lender.
8.17 Borrower shall INDEMNIFY, DEFEND AND HOLD HARMLESS, Lender, its
successors, assigns and shareholders (including corporate shareholders), and the
directors, officers, employees, agents and servants of the foregoing,
- 23 -
from any and all losses, costs, expenses (including, without limitation, court
costs and attorneys' fees), demands, claims, suits, proceedings (whether civil
or criminal), orders, judgments, penalties, fines and other sanctions arising
from or brought in connection with (i) the Project, the security for the
Performance of the Obligations, Lender's status by virtue of the Assignments,
creation of Security Interests, the terms of the Documents or the transactions
related hereto, or any act or omission of Borrower or the Servicing and
Collection Agents, or the employees or agents of any of them, whether actual or
alleged, and (i) any and all brokers' commissions or finders' fees or other
costs of similar type, or claims by any broker, agent or other party in
connection with this transaction (other than fees claimed owed by a broker,
finder, or other party with whom Lender has a specific agreement). On written
request by anyone covered by the above agreement of indemnity, Borrower shall
undertake, at its own cost and expense, on behalf of such indemnitee, using
counsel satisfactory to the indemnitee, the defense of any legal action or
proceeding to which the indemnitee shall be a party, provided that such action
or proceeding shall result from, or grow or arise out of any of the events set
forth in this paragraph.
8.18 Borrower shall not directly or indirectly invest all or any
part of the process of the Loan in any investment security subject to the margin
requirements of Regulation G of the Board of Governors of the Federal Reserve
System.
8.19 Borrower shall execute or cause to be executed all Documents
and do or cause to be done all acts necessary for Lender to perfect and to
continue the perfection of the Security Interest of Lender in the Receivables
Collateral or the other security for the Performance of the Obligations or
otherwise to effect the intent and purposes of the Documents. Borrower shall
prosecute or defend any action involving the priority, validity or
enforceability of the Security Interest granted to lender; provided that, at
Lender's option, Lender may do so at Borrower's expense.
8.20 Borrower is fully familiar with all of the terms and conditions
of the Documents and is not in default thereunder. No act or event has occurred
which after notice and/or lapse of time would constitute such a default or an
Event of Default.
8.21 Reserved
--------
8.22 Borrower hereby covenants and agrees as follows during the Term
hereof:
(a) As of the end of each fiscal quarter of Borrower, Borrower
shall maintain a net worth, calculated in accordance with generally accepted
accounting principles, consistently applied ("GAAP"), of at least Four Million
Dollars ($4,000,000.00).
(b) Expenses associated with the marketing and sale of Time-
Share Interests shall not exceed 50% of net sales, determined quarterly. Net
sales shall mean gross sales of Time-Share Interests during such quarterly
period reduced only by cancellations thereof.
- 24 -
(c) As of the end of each fiscal quarter of Borrower, the
Borrower shall maintain a ratio of total Indebtedness (exclusive of the Loan) to
net worth, calculated in accordance with GAAP, of not more than 2 to 1.
Indebtedness shall mean all liabilities, obligations and reserves, contingent or
otherwise, which in accordance with GAAP, would be reflected as a liability on a
balance sheet or would be required to be disclosed in a financial statement,
including, without duplication: (i) all Indebtedness for Borrowed Money, (ii)
all obligations secured by any lien, charge or encumbrance on the property of
Borrower, and (iii) all guaranties, letters of credit or other contingent
obligations. Indebtedness for Borrowed Money shall mean, without duplication,
all Indebtedness (i) in respect of money borrowed, (ii) evidenced by a note,
debenture or other like written obligation to pay money, (iii) in respect of the
rent or hire of property or for the deferred purchase price of property, or (iv)
in respect of obligations under conditional sales or other title retention
agreements, and all guaranties of any or all of the foregoing.
(d) Borrower shall not enter into any leases, as a lessee, the
obligations for rental payments under which are required to be capitalized in
accordance with GAAP, to the extent that the aggregate annual obligations under
all such leases would exceed $150,000 in any fiscal year of Borrower.
(e) Upon request by Lender, Borrower shall provide from time to
time such information as Lender may reasonably require to determining compliance
with the foregoing requirements.
8.23 Borrower shall not, without Lender's prior written consent: (i)
construct additional condominium or timeshare units within or adjacent to the
Project (other than to the initial 48 Units) until such time as at least 50% of
the Timeshare Interests applicable to the initial 48 Units are sold in bona-fide
transactions to parties not affiliated to Borrower; or (ii) sell any time-share
intervals from such additional condominium or timeshare units until at least 75%
of the Time-Share Interests applicable to the initial 48 Units are sold in bona-
fide transactions to parties not affiliated to Borrower.
8.24 If there occurs a material adverse change in the Project or in
the financial condition of Borrower or any Guarantor or in the Receivables
Collateral or any other security for the Performance of the Obligations, which
change is not enumerated in paragraph 8.22 or 9.1, Borrower will promptly
provide Lender with assurance that neither the prospect of Performance of the
Obligations nor Lender's security therefore is imperiled. If Borrower fails to
provide Lender with assurance satisfactory to Lender in its reasonable
discretion, such failure will be considered an Event of Default.
8.25 As additional consideration to Lender, Borrower shall pay to
Lender an incentive fee equal to One Hundred Forty-Six Thousand Eight Hundred
Eighty Dollars ($1,46,880.00) with respect to the Time-Share Interests sold by
Borrower in the Project. Such incentive fee shall be paid in installments of
Five Hundred Dollars ($500.00) per Time-Share Interest sold, plus related
reasonable fees and expenses (all as more fully provided in the Mortgage),
commencing with all sales occurring after the date upon which
- 25 -
the Construction Loan is due and payable in full, and shall continue until the
entire incentive fee is paid in full. Notwithstanding anything contained herein
to the contrary, the incentive fee is payable in full by Borrower on the first
day of the 26th month after the initial advance of the proceeds of the
Construction Loan.
8.26 The Borrower is in compliance in all material respects with all
applicable federal, state or local environmental, health and safety statutes and
regulations. The Borrower has not filed any notice under any federal or state
law indicating past or present treatment, storage or disposal of a hazardous
waste or reporting a spill or release of a hazardous or toxic waste, substance
or constituent, or other substances into the environment. None of the operations
of Borrower are the subject of federal or state litigation or proceedings
involving, or any investigation evaluating whether any remedial action involving
a material expenditure is needed to respond to, any improper treatment, storage,
recycling, disposal or release into the environment of any hazardous or toxic
substance, waste or constituent, or other substance. The Borrower does not have
any material contingent liability in connection with any improper treatment,
storage, recycling, disposal or release into the environment of any hazardous or
toxic substance, waste or constituent. None of the operation of Borrower are
subject to any judicial or administrative proceeding alleging the violation of
any federal, state or local environmental, health or safety statute or
regulation. The Borrower does not transport any hazardous wastes, substances or
constituents.
8.27 Provided that Borrower has not then borrowed the Maximum Loan
Amount, Borrower shall not, during the Borrowing Term, pledge, assign, or
hypothecate any Instruments other than to Lender, without Lender's prior written
consent. During the Borrowing Term, Lender shall the right of first negotiation
with Borrower in the event Borrower wishes to accept or seek an offer from a
third party to loan moneys to Borrower in exchange for a pledge, assignment or
hypothecation of any Instruments. In the event Borrower desires to seek or
obtain such an offer, Borrower shall first give Lender written notice to that
effect and give Lender the opportunity, within 10 Business Days thereafter, to
issue a financing proposal to Borrower, before Borrower enters into a binding
agreement with such third party with respect to such financing. However, subject
to the provisions of the first sentence of this paragraph, Borrower shall have
no obligation to accept a proposal from Lender with respect to such financing.
8.28 All representations and warranties contained in this Agreement
are continuing and shall be deemed to be made and reaffirmed prior to the making
of each Advance under this Agreement.
8.29 The representations, warranties and covenants contained in this
Agreement shall be applicable to and binding upon Borrower during the Term
hereof, notwithstanding the fact that no Advances have yet been made hereunder.
- 26 -
ARTICLE IX
----------
DEFAULT
-------
9.1 The occurrence of any of the following events or conditions
shall constitute an Event of Default by Borrower under the Documents:
(a) Lender fails to receive from Borrower when due and payable
any amount which Borrower is obligated to pay on the Note or any other payment
due under the Documents; and such failure shall continue for seven (7) days,
except for the payment of the final installment due at the Maturity Date, for
which no grace period is allowed;
(b) any representation or warranty of Borrower contained in the
documents or in any certificate furnished under the Documents proves to be, in
any material respect, false or misleading as of the date deemed made;
(c) there is a default in the Performance of the Obligations set
forth in paragraphs 8.8, 8.9, 8.12 or 8.13 hereof or Borrower knowingly violates
or suffers or permits the violation of any of the warranties or conditions of
the policies of insurance required under paragraph 8.9;
(d) there is a default in the Performance of the Obligations or
a violation of any term, covenant or provision of the Documents (other than a
default or violation referred to elsewhere in this paragraph 9.1) and such
default or violation continues unremedied (i) for a period of five days after
the giving of notice thereof to Borrower in the case of a default or violation
which can be cured by the payment of money alone or (ii) in the case of any
other default or violation, for a period of (A) thirty (30) days after the
giving of notice to Borrower, or (B) (in the event such default is not capable
of being cured within such thirty (30) day period) for a period not exceeding
sixty (60) days after the giving of such notice provided Borrower is diligently
and in good faith pursuing such cure;
(e) an "Event of Default," as defined elsewhere herein or in any
of the other Documents, occurs, or an act or event occurs under any of the
Documents, which is not cured within applicable notice or grace periods, whether
or not denominated as an Event of Default, which expressly entitles Lender to
accelerate any of the Obligations or exercise its other remedies upon the
occurrence of an Event of Default hereunder;
(f) any material default by Borrower under any other
agreement evidencing, guaranteeing, or securing borrowed money or a receivables
purchase financing has occurred and there has been an acceleration of such
indebtedness or repurchase obligations, which accelerated repayment or
repurchase obligations are in excess of $100,000 in the aggregate:
- 27 -
(g) any final, non-appealable judgment or decree for money
damages or for a fine or penalty against Borrower which is not paid and
discharged or stayed within 30 days thereafter and when aggregated with all
other judgment(s) or decree(s) that have remained unpaid and undischarged or not
stayed for such period is in excess of $100,000;
(h) any party holding a lien or security interest in the
Receivables Collateral, or any other security for the Performance of the
Obligations or a lien on any common areas or other amenities in the Project
commences foreclosure or similar sale thereof;
(i) (i) Borrower or any Guarantor becomes insolvent or unable to
pay its debts when due; generally fails to pay its debts when due; files a
petition in any bankruptcy, reorganization, winding-up or liquidation proceeding
or other proceeding analogous in purpose or effect relating to such entity;
applies for or consents to the appointment of a receiver, trustee or other
custodian for the bankruptcy, reorganization, winding-up or liquidation of such
entity; makes an assignment for the benefit of creditors; or admits in writing
that it is unable to pay its debts; (ii) any court order or judgment is entered
confirming the bankruptcy or insolvency of Borrower or any Guarantor or
approving any reorganization, winding-up or liquidation of such entity or a
substantial portion of its assets; (iii) there is instituted against Borrower or
any Guarantor any bankruptcy, reorganization, winding-up or liquidation
proceeding or other proceeding analogous in purpose or effect and the same is
not dismissed within 90 days after the institution thereof; or (iv) a receiver,
trustee or other custodian is appointed for any part of the Receivables
Collateral or the Project or all or a substantial portion of the assets of
Borrower or any Guarantor;
(j) Performance by Borrower or any Guarantor of any
material obligation under any Document or Guarantee, as the case may be, is
rendered unenforceable in any material respect, or any Guarantor repudiates,
rescinds, limits or annuals its Guarantee; or
(k) An Event of Default, as defined in the Construction Loan
Agreement, occurs, or an act or event occurs under any of the Construction Loan
Documents, whether or not denominated as an Event of Default, which expressly
entitles the Lender to exercise its remedies.
9.2 At any time after an Event of Default has occurred and while it
is continuing, Lender shall have the right to do any one or more of the
following:
(a) cease to make further Advances;
(b) declare the Note, together with prepayment premiums and all
other sums owing by Borrower to Lender in connection with the Documents,
- 28 -
immediately due and payable without notice, presentment, demand or protest,
which are hereby waived by Borrower;
(c) with respect to the Receivables Collateral, (i) institute
collection actions against all Persons obligated thereon and in default
thereunder; (ii) enter into modification agreements and make extension
agreements with respect to payments and other performances; (iii) release
Persons liable for the payment and performance thereof or the securities for
such payment and performance; and (iv) settle and compromise disputes with
respect to payments and performances claimed due thereon, all without notice to
Borrower, without being called to account therefor by Borrower and without
relieving Borrower from Performance of the Obligations;
(d) in the event Lender has previously agreed that Borrower may
act as Servicing Agent, remove Borrower as Servicing Agent and substitute as
Servicing Agent such other Person as Lender shall designate; and
(e) proceed to protect and enforce its rights and remedies under
this Agreement, the Construction Loan Documents or any other documents and to
foreclose or otherwise realize upon its security for the Performance of the
Obligations, or to exercise any other rights and remedies available to it at
law, in equity or by statute.
The rights and powers granted pursuant to this paragraph are not
intended to limit the rights and powers granted elsewhere herein.
9.3 Notwithstanding anything in the Documents to the contrary, while
an Event of Default exists, any cash received and retained by Lender in
connection with the Receivables Collateral may be applied to payment of the
Obligations in the manner provided in paragraph 9.5 hereof.
9.4 (a) Pursuant to its rights under paragraph 9.2 hereof, following
an Event of Default, and subject to the terms and conditions hereof, Lender may
sell, assign and deliver the Receivables Collateral, or any part thereof, at
public or private sale, conducted in a commercially reasonable manner by an
officer, or agent of, or auctioneer or attorney for, Lender at Lender's place of
business or elsewhere, for cash, upon credit or future delivery, and at such
price or prices as Lender shall reasonably determine, and Lender may be the
purchaser of any or all of the Receivables Collateral so sold. Lender may, in
its reasonable discretion, at any such sale, restrict the prospective bidders or
purchasers as to number, nature of business and investment intention, and,
without limitation, may require that the persons making such purchases represent
and agree to the satisfaction of Lender that they are purchasing the Receivables
Collateral for their account, for investment, and not with a view to the
distribution or resale of any thereof. Lender shall have no obligation to delay
sale of any Receivables Collateral for the period of time necessary to permit
such Receivables Collateral to be registered for public sale under the
Securities Act of 1933, as amended, and any applicable state securities laws.
Private sales
- 29 -
made without registration shall not be deemed to have been made in a
commercially unreasonable manner by virtue of any terms less favorable to the
seller resulting from the private nature of such sales.
(b) Without prejudice to the right of Lender to make such sale
within such shorter period as may be reasonable under the circumstances,
foreclosure sale of all or any part of the Receivables Collateral shall be
deemed held pursuant to reasonable notice if held:
(i) 45 days after notice is given, based upon
default consisting of insolvency, bankruptcy or other default of a
nature which cannot be corrected by Borrower, or default for which
no grace period is specified herein; or
(ii) 60 days after notice of any other act,
circumstance or event which, if uncorrected, after expiration of any
applicable grace period, shall constitute a default hereunder.
Where any notice to Borrower and grace period thereafter is required under this
Agreement, such grace period shall be deducted from the 60 day notice of
foreclosure sale specified in item (ii) above, so that the maximum period
between notice to Borrower of any act, circumstance or event which, if
uncorrected after elapse of any applicable grace period, would constitute an
Event of Default and the foreclosure sale of the Receivables Collateral based
upon such Event of Default shall in no event be required to exceed 60 days.
(c) At any sale following an Event of Default, the Receivables
Collateral may be sold as an entirety or in partial interests. Lender shall not
be obligated to make any sale pursuant to any notice previously given. In case
of any sale of all or any part of the Receivables Collateral on credit or for
future delivery, the Receivables Collateral so sold may be retained by Lender
until the selling price is paid by the purchaser thereof, but Lender shall not
incur any liability in case of the failure of such purchaser to take up and pay
for the collateral so sold; and in case of any such failure, such Receivables
Collateral may again be sold under and pursuant to and in compliance with the
provisions hereof.
(d) In connection with sales made following an Event of
Default, Lender may, in the name and stead of Borrower or in its own name, make
and execute all conveyances, assignments and transfers of the Receivables
Collateral sold pursuant to this Agreement; and Lender is hereby appointed
Borrower's attorney-in-fact for this purpose. Nevertheless, Borrower will, if so
requested by Lender, ratify and confirm any sale or sales by executing and
delivering to Lender, or to such purchaser or purchasers, all such instruments
as may, in the judgment of Lender, be advisable for that purpose.
(e) The receipt by Lender of the purchase money paid at any
sale made following an Event of Default shall be a sufficient discharge therefor
to any purchaser of the Receivables Collateral or any portion thereof, and no
such purchaser, after paying such purchase money and receiving such receipt,
shall be bound to see to the application of such
- 30 -
purchase money or any part thereof or in any manner whatsoever be answerable for
any loss, misapplication or nonapplication of any such purchase money, or any
part thereof, or be bound to inquire as to the authorization, necessity,
expediency or regularity of any such sale.
(f) Each purchaser at any sale following an Event of Default
shall hold the Receivables Collateral so sold absolutely free from every claim
or right of Borrower, including, without limitation, any equity or right of
redemption of Borrower, which Borrower hereby specifically waives to the extent
Borrower may lawfully do so. Lender, its employees and agents shall after such
sale be fully discharged from any liability or responsibility in any matter
relating to the Receivables Collateral and such other security that is sold and
resulting from any action or inaction on the part of such purchaser or any
successor-in-interest of such purchaser.
9.5 The proceeds of any sale of all or any part of the Receivables
Collateral shall be applied in the following order or priorities: first, to the
payment of all reasonable costs .and expenses of such sale, including, without
limitation, reasonable compensation to Lender and its agents, attorneys' fees,
and all other reasonable expenses, liabilities and advances incurred or made by
Lender, its agents and attorneys, in connection with such sale, and any other
unreimbursed expenses for which Lender may be reimbursed pursuant to the
Documents; second, to the payment of the Obligations, in such order and manner
as Lender shall in its discretion determine, with no amounts applied to payment
of principal until all interest has been paid; and third, to the payment to
Borrower, its successors or assigns, or to whomsoever may be lawfully entitled
to receive the same, or as a court of competent jurisdiction may direct, of any
surplus then remaining from such proceeds.
9.6 Lender may, at its option, and without any obligation to do so,
pay, perform and discharge any and all amounts, costs, expenses and liabilities
herein agreed to be paid or performed by Borrower if Borrower fails to do so
within 7 days following the giving of written notice of such failure; and for
such purposes Lender may use the proceeds of the Receivables Collateral and is
hereby appointed Borrower's attorney-in-fact. All amounts expended by Lender in
so doing or in exercising its remedies hereunder following an Event of Default
shall become part of the Obligations secured hereby, shall be immediately due
and payable by Borrower to Lender upon demand therefor, and shall bear interest
at the Overdue Rate from the dates of such expenditures until paid. Exercise by
Lender of its option under this paragraph will not cure any default of Borrower.
9.7 No remedy herein or in any other Document conferred on or reserved
to Lender is intended to be exclusive of any other remedy or remedies, but each
and every such remedy shall be cumulative and shall be in addition to every
other remedy given hereunder, under any other Document or now or hereafter
existing at law or in equity. Notwithstanding anything herein to the contrary,
in any non-judicial, public or private sale or sales under the Uniform
Commercial Code or in any judicial foreclosure and sale of the Receivables
Collateral, the Receivables Collateral may be sold in any manner whatsoever not
prohibited by law. No delay or omission to exercise any right or power
- 31 -
shall be construed to be a waiver of any default or acquiescence therein or a
waiver of any right or power; and every such right and power may be exercised
from time to time and as often as may be deemed expedient. Lender's acceptance
of any performance due hereunder which does not comply strictly with the terms
hereof shall not be deemed to be a waiver of any right of Lender to strict
Performance by Borrower. Acceptance of past due amounts or partial payments
shall not constitute a waiver of full and timely payment of the Obligations. No
Event of Default, declaration of the unpaid principal of the Loan to be
immediately due and payable or exercise of any other right to remedy upon
default shall stay, waive, or otherwise affect Lender's right to receive
payments on and other proceeds of the Receivables Collateral.
9.8 Borrower, for itself and for all who may claim through or under
it, hereby expressly waives and releases all right to have the Receivables
Collateral or any other security for the Performance of the Obligations, or any
part thereof, marshalled on any foreclosure, sale or other enforcement hereof.
9.9 While an Event of Default exists, Borrower shall, on the request
of Lender, assemble the Receivables Collateral not already in Lender's
possession and make it available to Lender at a time and place reasonably
convenient to Lender.
ARTICLE X
---------
POWER OF ATTORNEY
-----------------
For the purpose of enabling Lender to protect and preserve its
Security Interest in the Receivables Collateral and its rights and remedies
under this Agreement and the Documents, Borrower does hereby constitute and
appoint Lender, and its successors and assigns, to be Borrower's true and lawful
attorney-in-fact upon the occurrence of an Event of Default, and during the
continuance thereof, to perform any act, take any action, execute and sign any
document, statement, instrument or other writing, and to do and perform any and
all deeds and things in the name, place, and stead of Borrower, which Lender in
its discretion shall determine necessary or required to protect and preserve its
Security Interest in the Receivables Collateral and its rights and remedies
under this Agreement and the Documents, or which Borrower is required or
obligated to perform under the terms of this Agreement or the Documents.
ARTICLE XI
----------
CONSTRUCTION AND GENERAL RULES
-------------------------------
11.1 All moneys payable hereunder or under the Documents shall be paid
to Lender at its address set forth below.
11.2 This Agreement and the other Documents exclusively and completely
state the rights and obligations of Lender and Borrower with respect to the
Loan. No modification, termination, variation, discharge or abandonment hereof
and no
- 32 -
waiver of any of the provisions or conditions shall be valid unless in writing
and signed by duly authorized representatives of Lender and Borrower or the
successor, transfers or assigns of either, subject, however, to the limitations
on assignment herein by Borrower. This Agreement supersedes any and all prior
agreements or understandings, written or oral, between Borrower and Lender
(other than in the other Documents) concerning this transaction.
11.3 The powers and agency hereby granted by Borrower are coupled with
an interest and are irrevocable and are granted as cumulative to the remedies
for collection of the indebtedness secured hereby provided by law.
11.4 This Agreement may be executed simultaneously in any number of
identical copies each of which shall constitute an original for all purposes.
11.5 Any notice required or permitted to be given hereunder shall be
in writing and shall be (i) personally delivered to the party being notified if
an individual or to an officer or general partner if a corporation or
partnership, or (ii) transmitted by postage prepaid, certified or registered
mail (return receipt requested) to such party at its address after its signature
on the signature page hereof or such other address as the party being notified
may have otherwise designated in a notice given as provided in this paragraph.
Such notice shall be deemed to be given and effective, unless actual receipt is
expressly elsewhere specified herein, upon the date of receipt or the date three
(3) days after posting it transmitted by mail, whichever shall first occur. A
copy of any notices given to Borrower shall also be given to:
Xxx Xxxx III, Esq.
Shreeder, Xxxxxxx & Flint
The Xxxxxxx Building, 16th Floor
000 Xxxxxxxxx Xxxxxx, X.X.
Xxxxxxx, Xxxxxxx 00000-0000
11.6 All the covenants, promises, stipulations and agreements of
Borrower and all the rights and remedies of the Lender in this Agreement
contained shall bind Borrower, and, subject to the restriction on merger,
consolidation and assignment herein contained, its successors and assigns, and
shall inure to the benefit of Lender, its successors and assigns, whether so
expressed or not. Borrower may not assign its rights herein in whole or in part.
Except as may be expressly provided herein, no person or other entity shall be
deemed a third party beneficiary of this Agreement.
11.7 Subject to the provisions of Article IX hereof, if any one or
more of the provisions contained in this Agreement shall be held invalid,
illegal or unenforceable in any respect, the validity, legality and
enforceability of the remaining provisions contained herein shall not in any way
be affected or impaired thereby.
11.8 Time is of the essence in the Performance of the Obligations.
- 33 -
11.9 All headings are inserted for convenience only and shall not
affect any construction or interpretation of this Agreement. The provisions of
this Agreement shall apply to the parties according to the context hereof and
without regard to the number or gender of words and expressions used herein.
Unless otherwise indicated, all references herein to clauses and other
subdivisions refer to the corresponding paragraphs, clauses and other
subdivisions of this Agreement; the words "herein", "hereof", "hereto",
"hereunder" and words of similar import refer to this Agreement as a whole and
not to any particular paragraph, clause or other subdivision hereof; and
reference to a numbered or lettered subdivision of an Article, or paragraph
shall include relevant matter within the Article or paragraph which is
applicable to but not within such numbered or lettered subdivision.
11.10 THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED ACCORDING TO
THE LAWS OF THE STATE OF ARIZONA. BORROWER HEREBY AGREES THAT ALL ACTIONS OR
PROCEEDINGS INITIATED BY BORROWER AND ARISING DIRECTLY OR INDIRECTLY OUT OF THE
DOCUMENTS SHALL BE LITIGATED IN THE SUPERIOR COURT OF ARIZONA, MARICOPA COUNTY
DIVISION, OR THE UNITED STATES DISTRICT COURT OF ARIZONA OR, IF LENDER INITIATES
SUCH ACTION, IN ADDITION TO THE FOREGOING COURTS, ANY COURT IN WHICH LENDER
SHALL INITIATE SUCH ACTION, TO THE EXTENT SUCH COURT HAS JURISDICTION. BORROWER
HEREBY EXPRESSLY SUBMITS AND CONSENTS IN ADVANCE TO SUCH JURISDICTION IN ANY
ACTION OR PROCEEDING COMMENCED BY LENDER IN ANY OF SUCH COURTS, AND HEREBY
WAIVES PERSONAL SERVICE OF THE SUMMONS AND COMPLAINT, OR OTHER PROCESS OR PAPERS
ISSUED THEREIN, AND AGREES THAT SERVICE OF SUCH SUMMONS AND COMPLAINT OR OTHER
PROCESS OR PAPERS MAY BE MADE BY REGISTERED OR CERTIFIED MAIL ADDRESSED TO
BORROWER AT THE ADDRESS TO WHICH NOTICES ARE TO BE SENT PURSUANT TO THIS
AGREEMENT. BORROWER WAIVES ANY CLAIM THAT PHOENIX, ARIZONA OR THE DISTRICT OF
ARIZONA IS AN INCONVENIENT FORUM OR AN IMPROPER FORUM BASED ON LACK OF VENUE.
SHOULD BORROWER, AFTER BEING SO SERVED, FAIL TO APPEAR OR ANSWER TO ANY SUMMONS,
COMPLAINT, PROCESS OR PAPERS SO SERVED WITHIN THE NUMBER OF DAYS PRESCRIBED BY
LAW AFTER THE MAILING THEREOF, BORROWER SHALL BE DEEMED IN DEFAULT AND AN ORDER
AND/OR JUDGMENT MAY BE ENTERED BY LENDER AGAINST BORROWER AS DEMANDED OR PRAYED
FOR IN SUCH SUMMONS, COMPLAINT, PROCESS OR PAPERS. THE EXCLUSIVE CHOICE OF FORUM
FOR BORROWER SET FORTH IN THIS PARAGRAPH SHALL NOT BE DEEMED TO PRECLUDE THE
ENFORCEMENT, BY LENDER OF ANY JUDGMENT OBTAINED IN ANY OTHER FORUM OR THE TAKING
BY LENDER OF ANY ACTION TO ENFORCE THE SAME IN ANY OTHER APPROPRIATE
JURISDICTION, AND BORROWER HEREBY WAIVES THE RIGHT TO COLLATERALLY ATTACK ANY
SUCH JUDGMENT OR ACTION. LENDER AND BORROWER ACKNOWLEDGE AND AGREE THAT ANY
CONTROVERSY WHICH MAY ARISE UNDER ANY OF THE DOCUMENTS OR WITH RESPECT TO THE
TRANSACTIONS CONTEMPLATED THEREBY WOULD BE BASED UPON DIFFICULT AND
- 34 -
COMPLEX ISSUES AND, THEREFORE, THE PARTIES AGREE THAT ANY LAWSUIT ARISING OUT
OF ANY SUCH CONTROVERSY SHALL BE TRIED IN A COURT OF COMPETENT JURISDICTION BY
A JUDGE SITTING WITHOUT A JURY.
11.11 It is the intent of the parties hereto to comply with the
Applicable Usury Law. Accordingly, notwithstanding any provisions to the
contrary in this Agreement or in any of the other Documents in no event shall
this Agreement or the Documents require the payment or permit the collection of
interest in excess of the maximum contract rate permitted by the Applicable
Usury Law. If (i) any such excess of interest otherwise would be contracted for,
charged or received from Borrower or otherwise in connection with the
Obligations or (ii) the maturity of the Obligations is accelerated in whole or
in part, or (iii) all or part of the principal or interest of the Obligations
shall be prepaid, so that under any of such circumstances the amount of interest
contracted for, charged or received in connection with the Obligations would
exceed the maximum contract rate permitted by the Applicable Usury Law, then in
any such event (A) the provisions of this paragraph shall govern and control,
(B) neither Borrower nor any other person or entity now or hereafter liable for
the payment hereof will be obligated to pay the amount of such interest to the
extent that it is in excess of the maximum contract rate permitted by the
Applicable Usury Law, (C) any such excess which may have been collected shall be
either applied as a credit against the then unpaid principal amount of the
Obligations of Borrower or refunded to Borrower, at Lender's option, and (D) the
effective rate of interest will be automatically reduced to the maximum contract
rate permitted by the Applicable Usury Law. Without limiting the generality of
the foregoing, to the extent permitted by the Applicable Usury Law: (x) all
calculations of the rate of interest which are made for the purpose of
determining whether such rate would exceed the maximum contract rate permitted
by the Applicable Usury Law shall be made by amortizing, prorating, allocating
and spreading during the period of the full stated term of the Obligations, all
interest at any time contracted for, charged or received from Borrower or
otherwise in connection with the Obligations; and (y) in the event that the
effective rate of interest on the Obligations should at any time exceed the
maximum contract rate permitted by the Applicable Usury Law, such excess
interest that would otherwise have been collected had there been no ceiling
imposed by the Applicable Usury Law shall be paid to Lender from time to time,
if and when the effective interest rate on the Obligations otherwise falls below
the maximum contract rate permitted by the Applicable Usury Law, to the extent
that interest paid to the date of calculation does not exceed the maximum
contract rate permitted by the Applicable Usury Law, until the entire amount of
interest which would have otherwise been collected had there been no ceiling
imposed by the Applicable Usury Law has been paid in full. Should the maximum
contract rate permitted by the Applicable Usury Law be increased at any time
hereafter because of a change in the law, then to the extent not prohibited by
the Applicable Usury law, such increases shall apply to all the Obligations
regardless of when incurred; but, again to the extent not prohibited by the
Applicable Usury Law, should the maximum contract rate permitted by the
Applicable Usury law be decreased because of a change in the law, such decreases
shall not apply to the Obligations regardless if resulting from an advance of
the Loan made after the effective date of such decrease.
- 35 -
ARTICLE XII
-----------
SPECIAL PROVISIONS
------------------
12.1 Lender covenants and agrees that, notwithstanding anything to the
contrary herein or in any other Document, during the Term hereof it shall take
no action to disturb Purchasers in their use and possession of their Time-Share
Interests or otherwise to impair the rights and privileges of such Purchasers
under their Time-Share Interests or the governing documents of the Project so
long as such Purchasers are fulfilling their obligations under their respective
Instruments.
- 36 -
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be executed by Persons duly authorized on the day and year first above written.
"Lender"
GREYHOUND REAL ESTATE FINANCE
COMPANY, an Arizona corporation
By /s/
---------------------------
Vice President
Address:
Dial Xxxxxxxxx Xxxxxx
Xxxx Xxxxx
Xxxxxxx, Xxxxxxx 00000
Attention: Vice-President-Law
With a copy to:
Dial Xxxxxxxxx Xxxxxx
Xxxx Xxxxx
Xxxxxxx, Xxxxxxx 00000
Attention: Manager, Administration,
Real Estate Finance Division
"Borrower"
CYPRESS POINTE RESORTS, L.P., a Delaware
limited partnership
By: ARGOSY GROUP, INC., a Georgia
corporation, General Partner
By: /s/ XXXXXX X. XXXXXX
-----------------------------------
Xxxxxx X. Xxxxxx, Vice President
[CORPORATE SEAL]
Address:
0000 Xxxxxxxx Xxxxxxxxx
Xxxxx 000
Xxxxxxx Xxxxx, Xxxxxxxxxx 00000
- 37 -
AMENDMENT TO LOAN AND SECURITY AGREEMENT
----------------------------------------
AND CONSENT AND AGREEMENT OF GUARANTORS
---------------------------------------
This Amendment to Loan and Security Agreement and Consent and
Agreement of Guarantors (this "Amendment") is made and entered into as of this
9th day of November, 1992 by and between CYPRESS POINTE RESORTS, L.P., a
Delaware limited partnership ("Borrower") and GREYHOUND REAL ESTATE FINANCE
COMPANY, an Arizona corporation ("Lender").
WITNESSETH
WHEREAS, as of December 19, 1991, Borrower and Lender executed a Loan
and Security Agreement (the "Receivables Agreement") pursuant to which Lender
agreed to make a revolving loan to Borrower for the purposes set forth therein;
and
WHEREAS, Borrower and Lender have agreed to amend the Receivables
Agreement in various aspects.
NOW THEREFORE, for good and valuable consideration, the receipt,
sufficiency and adequacy of which are hereby acknowledged, the parties agree as
follows:
1. Definitions: The Receivables Agreement is hereby amended by
-----------
adding the following definitions to Article II thereof:
1.1 "Nonconforming Borrowing Base" shall mean an amount
equal to the lesser of (i) seventy percent (70%) of the unpaid
principal balance payable under a Nonconforming Instrument that
otherwise qualifies as an Eligible Instrument, or (ii) seventy percent
(70%) of the then present value assigned to the unmatured installments
of principal and interest payable under a Nonconforming Instrument
that qualifies as an Eligible Instrument discounted at Lender's
Prevailing Discount Rate.
1.2 "Nonconforming Instrument Ratio" shall mean a ratio, the
numerator of which is the total amount Advanced against Nonconforming
Instruments less payments received by Lender on such Nonconforming
Instruments and the denominator of which is the then unpaid principal
balance of the Loan.
1.3 "Nonconforming Instruments" shall mean an Instrument as
described below but that otherwise meets the eligibility criteria set
forth on Exhibit "B":
(i) The Instrument matures over a term not exceeding
one hundred and twenty (120) months from its execution and the
Borrower has received from the Purchaser issuing such Instrument
a minimum cash down payment of ten percent 10% of the total sales
price, no part of which has been advanced or loaned to such
Purchaser by Borrower or any Guarantor, directly or indirectly;
or
(ii) The Instrument matures over a term not exceeding
sixty (60) months from its execution, interest accrues on the
unpaid principal balance of the Instrument at a rate of not less
than nine and 9/10 percent (9.9%) per annum and Borrower has
received from the Purchaser issuing such Instrument a minimum
cash down payment of twenty percent (20%) of the total sales
price, no part of which has been advanced or loaned to such
Purchaser by Borrower or any Guarantor, directly or indirectly;
or
(iii) The Instrument matures over a term not exceeding
twenty-four (24) months from the date of its execution, does not
accrue interest and the Borrower has received from the Purchaser
issuing such Instrument a minimum cash down payment of thirty-
three percent (33%) of the total sales price, no part of which
has been advanced or loaned to such Purchaser by Borrower or any
Guarantor, directly or indirectly.
2. Other Definitions. Unless otherwise defined in this Amendment,
-----------------
all capitalized terms which are used in this Amendment shall have the same
meaning as set forth in the Receivables Agreement.
3. Minimum Interest Rate. Subparagraph (d) of Exhibit "B" to the
---------------------
Receivables Agreement is hereby modified to delete from the provisions thereof
the words "12% per annum" and substitute in lieu thereof the words "10.9% per
annum."
4. Advances. A Section 3.7 shall be added to the Receivables
--------
Agreement reading as follows:
- 2 -
3.7 Lender will make Advances against Nonconforming
Instruments on the condition that (i) such Instruments otherwise
qualify as Eligible Instruments, (ii) at no time during the Term shall
the total amount advanced against Nonconforming Instruments, less
payments received by Lender under such Instruments, exceed
$3,000,000.00, and (iii) Borrower is otherwise entitled to an Advance
under the provisions of the Receivables Agreement. At all times during
which the Nonconforming Instrument Ratio is in excess of thirty
percent (30%), the Nonconforming Borrowing Base shall be used for
purposes of determining the amount of Advances to be made against
Nonconforming Instruments. Borrower shall not permit the Nonconforming
Instrument Ratio to be in excess of thirty percent (30%) for a period
in excess of sixty (60) days at any time during the Term.
5. Frequency. The provisions of Section 3.2 of the Receivables
---------
Agreement shall be modified to read as follows:
3.2. Advances shall not be made more frequently than twice per
calendar month and each Advance shall be in an amount of not less than One
Hundred Thousand Dollars ($100,000.00). In consideration for Lender's
agreement to increase the frequency of Advances from one per month to two
per month, Borrower agrees to pay to Lender, concurrently with the making
of the second Advance in each calendar month, a fee equal to Five Hundred
Dollars ($500.00), with Lender being entitled to withhold such fee from the
proceeds of the Advance. The foregoing fee is to paid to Lender strictly in
consideration for Lender's agreement to increase the frequency of advances
and shall not be applied or credited against any other Obligations,
including but not limited to principal or interest due under the Note.
6. Interval Release. A Section 3.8 shall be added to the
----------------
Receivables Agreement reading as follows:
3.8 With respect to the sale of a particular Time-Share
Interest, Lender shall release such Time-Share Interest from the lien
of the Construction Mortgage and defer for a period of 75 days
following such release, the payment of the interval release fee (the
"Release Fee") described in Section 5.20(i) of the Construction
Mortgage on the conditions that:
(i) the Borrower is otherwise entitled to obtain a
release of the Time-Share Interest from the lien of the
Construction Mortgage;
- 3 -
(ii) the Purchaser has delivered to the Borrower an
Instrument representing a portion of the purchase price of the
Time-Share Interest and did not pay the entire purchase price in
cash at the time of its acquisition of the Time-Share Interest;
(iii) The signed Instrument, endorsed to Lender by
Borrower, with recourse, the recorded Purchaser Mortgage securing
such Instrument, the assignment to Lender of the Purchaser
Mortgage, and the lender's policy of title insurance insuring the
lien of such Purchaser Mortgage subject only to the Permitted
Encumbrances, all as more fully set forth in the Receivables
Agreement, have been delivered by Borrower to and are in the
possession of Xxxxxxxxx, Xxxxxxx and Xxxxx in its capacity as an
agent of First American Title Insurance Company and not in its
capacity as counsel for Borrower (the "Escrow Agent") pursuant to
a separate agreement between Lender and Escrow Agent; and
(iv) all recission rights under the Instruments have
expired.
At such time as the Instrument is at least thirty (30) days aged from
the date of its execution and at least one monthly installment payment has been
made and at such time as Borrower has delivered to Lender all other items
necessary or required in connection with an Advance against such Instrument,
Escrow Agent shall deliver to Lender the items being held by Escrow Agent
pursuant to subsection (iii) above. Lender shall thereafter evaluate the
eligibility of such Instrument. In the event such Instrument constitutes an
Eligible Instrument and in the event Borrower is otherwise entitled to an
Advance, Lender shall make an Advance against such Eligible Instrument as soon
as is reasonably convenient thereafter; subject, however, to the other
conditions for Advance set forth in the Receivables Agreement, as amended.
Lender shall be entitled to withhold from such Advance or from any other
Advance, any then due Release Fees. In the event such Instrument does not
qualify as an Eligible Instrument or Lender is otherwise not obligated to make
an Advance against such Instrument, then as soon as is reasonably convenient
thereafter, Lender shall reassign such Instrument and the Purchaser Mortgage to
Borrower, without recourse. The foregoing notwithstanding, any deferred Release
Fees shall be due and payable no later than 75 days following the release from
the
- 4 -
Construction Mortgage of Time Share Interest with respect to which such Release
Fee is payable.
The definition of Receivables Collateral contained in Section 2.43 of
the Receivables Agreement shall be modified by deleting from the second and
third lines of the words "in consideration for an Advance made by Lender" so
that all Instruments assigned, transferred, endorsed or delivered to Lender, all
Purchaser Mortgages assigned to Lender and all other elements of the Receivables
Collateral definition to the extent relating or delivered in connection with
such Instruments, shall constitute Receivables Collateral, notwithstanding
whether or not Lender makes an Advance against such Instrument. Borrower hereby
reaffirms and grants to Lender a first and exclusive Security Interest in and to
the Receivables Collateral assigned, transferred, endorsed or delivered to
Lender, as the definition of Receivables Collateral has been modified pursuant
to the provisions of this Amendment, as security for Borrower's payment and
Performance of all Obligations owed to Lender, other than those arising out of
the Environmental Certificate with Representations, Covenants and Warranties
delivered in connection with the Construction Loan Agreement.
Escrow Agent shall hold the Instruments as a bailee with notice for
the benefit of Lender for purposes of perfecting Lender's Security Interest in
such Instruments.
5. Confirmation of Representations, Warranties and Agreements.
----------------------------------------------------------
Borrower hereby reaffirms as if made as of the date hereof, all of Borrower's
representations and warranties contained in the Receivables Agreement. Borrower
furthermore hereby reaffirms the validity, enforceability and legality of the
Documents and the Construction Loan Documents and all provisions of the
Documents and Construction Loan Documents are hereby confirmed and ratified.
However, in the event of a conflict or inconsistency between provisions of the
Receivable Agreement and this Amendment, the provisions of this Amendment shall
prevail.
7. Guarantor Consent. As a condition precedent to the effectiveness
-----------------
of this Amendment, Borrower shall cause the Guarantors to execute the Consent
and Agreement forming a part hereof, thereby acknowledging the making of the
agreements contained herein.
- 5 -
IN WITNESS WHEREOF, the parties have executed this Amendment as of the
date and year first written above.
CYPRESS POINTE RESORTS, L.P.,
a Delaware limited partnership
By: ARGOSY GROUP, INC.
a Georgia corporation,
General Partner
By /s/ ILLEGIBLE SIGNATURE
----------------------------
Its Vice President
----------------------------
Borrower
[CORPORATE SEAL]
GREYHOUND REAL ESTATE
FINANCE COMPANY, an Arizona
corporation
By /s/ ILLEGIBLE SIGNATURE
----------------------------
Its Sr. Vice President
----------------------------
Lender
- 6 -
CONSENT AND AGREEMENT OF GUARANTORS
-----------------------------------
The undersigned ARGOSY GROUP, INC. a Georgia corporation, hereby
acknowledges that it executed a Corporate Guarantee and Subordination Agreement
dated as of December 19, 1991 (the "Corporate Guarantee") in favor of Greyhound
Real Estate Finance Company, an Arizona corporation ("Lender").
The undersigned ARGOSY CANYON INVESTMENTS, L.P., a California limited
partnership, hereby acknowledges that it executed a Partnership Guarantee and
Subordination Agreement dated as of December 19, 1991 (the "Partnership
Guarantee") in favor of Lender (the Corporate Guarantee and the Partnership
Guarantee, collectively the "Guarantee").
The undersigned acknowledge that Cypress Pointe Resorts, LP., a
Delaware limited partnership and Lender have executed an Amendment to Loan and
Security Agreement (the "Amendment") which resulted in an amendment to the
Receivables Agreement (as that term is defined in the Amendment). The
undersigned acknowledge that the Guarantee that each of the undersigned has
executed shall remain in full force and effect and that all references in the
Guarantee to the Receivables Agreement (regardless of the precise form of such
reference) are amended to refer to that document as amended by the Amendment.
The Guarantee executed by each of the undersigned shall continue in
full force and effect and shall remain unaffected and unchanged except as
specifically amended by this Consent and Agreement, and the same, as amended,
are hereby confirmed and ratified, and the undersigned specifically acknowledge
the validity and enforceability thereof.
Dated as of this 9th day of November, 1992.
ARGOSY GROUP, INC.,
a Georgia corporation
By /s/ ILLEGIBLE SIGNATURE
-----------------------
Its Vice President
----------------------
ARGOSY CANYON
INVESTMENTS, L.P.,
a California limited partnership
By: CanPartners Incorporated,
a California corporation,
its General Partner
By
-----------------------
Its
-----------------------
ACCEPTED:
GREYHOUND REAL ESTATE
FINANCE COMPANY
By /s/ ILLEGIBLE SIGNATURE
-----------------------
Its Sr. Vice President
----------------------
- 8 -
CONSENT AND AGREEMENT OF GUARANTORS
-----------------------------------
The undersigned ARGOSY GROUP, INC. a Georgia corporation, hereby
acknowledges that it executed a Corporate Guarantee and subordinate Agreement
dates as of December 19, 1991 (the "Corporate Guarantee") in favor of Greyhound
Real Estate Finance Company, an Arizona corporation ("Lender").
The undersigned ARGOSY CANYON INVESTMENTS, L.P., a California limited
partnership, hereby acknowledges that it executed a partnership Guarantee and
Subordinated Agreement dated as of December 19, 1991 (the "Partnership
Guarantee") in favor of Lender (the Corporate Guarantee and the Partnership
Guarantee, collectively the "Guarantee").
The undersigned acknowledge that Cypress Pointe Resorts, L.P., a
Delaware limited partnership and Lender have executed an Amendment to Loan and
Security Agreement (the "Amendment") which resulted in an amendment to the
Receivables Agreement (as that term is defined in the amendment). The
undersigned acknowledge that the Guarantee that each of the undersigned has
executed shall remain in full force and effect and that all references in the
Guarantee to the Receivables Agreement (regardless of the precise form of such
reference) are amended to refer to that document as amended by the Amendment.
The Guarantee executed by each of the undersigned shall continue in
full force and effect and shall remain unaffected and unchanged except as
specifically amended by this Consent and Agreement, and the same, amended, are
hereby confirmed and ratified, and the undersigned specifically acknowledge the
validity and enforceability thereof.
Dated as of this 9th day of November, 1992.
ARGOSY GROUP, INC.,
a Georgia corporation
By /s/ ILLEGIBLE SIGNATURE
-----------------------
Its Vice President
-----------------------
ARGOSY CANYON
INVESTMENTS, L.P.,
a California limited partnership
By: CanPartners Incorporated, a
California corporation, its General
Partner
By /s/ ILLEGIBLE SIGNATURE
-----------------------
Its
-----------------------
ACCEPTED:
GREYHOUND REAL ESTATE
FINANCE COMPANY
By /s/
----------------------
Its
----------------------
- 8 -
SECOND AMENDMENT TO LOAN
AND SECURITY AGREEMENT
THIS SECOND AMENDMENT TO LOAN AND SECURITY AGREEMENT ("Second
Amendment") is made and entered into as of the 13th day of January, 1993, by and
between CYPRESS POINTE RESORTS, L.P., a Delaware limited partnership
("Borrower"), and GREYHOUND FINANCIAL CORPORATION, a Delaware corporation
("Lender").
WITNESSETH:
WHEREAS, as of December 19, 1991, Borrower and Lender's predecessor in
interest, Greyhound Real Estate Finance Company, an Arizona corporation
("GREFCO"), entered into that Loan and Security Agreement (the "Receivables Loan
Agreement") pursuant to which Lender agreed to make a revolving loan to Borrower
for the purposes set forth therein; and
WHEREAS, Borrower and GREFCO modified and amended the Receivables Loan
Agreement pursuant to that Amendment to Loan and Security Agreement and Consent
and Agreement of Guarantors dated as of November 9, 1992 (the "First
Amendment"), whereby the Receivables Loan Agreement was modified and amended
pursuant to the terms and conditions set forth therein; and
WHEREAS, pursuant to that Assignment of even date herewith between
GREFCO and Lender, GREFCO has assigned to Lender all of its rights and
obligations under the Receivables Loan Agreement and the First Amendment and all
other documents and instruments executed in connection therewith; and
WHEREAS, Borrower and Lender have agreed to further amend the
Receivables Loan Agreement pursuant to the terms and provisions of this Second
Amendment.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties agree as follows:
1. Definitions. Except as specifically set forth in and/or modified
-----------
by this Second Amendment, all capitalized terms set forth herein shall have the
meanings set forth therefor in the Receivables Loan Agreement. The following
capitalized terms shall have the meanings set forth below, notwithstanding any
contrary definitions contained in the Receivables Loan Agreement.
1.1 "CONSTRUCTION LOAN AGREEMENT" shall mean that certain
Construction Loan Agreement dated as of December 19, 1991, between Borrower and
GREFCO, as modified and amended pursuant to that First Amendment to Construction
Loan Agreement of even date herewith between Borrower and Lender.
1.2 "LOAN" shall mean the line of credit loan extended by Lender
to Borrower in accordance with the terms of the Receivables Loan Agreement, as
modified by the First Amendment and this Second Amendment, in a principal amount
not to exceed at any time outstanding the Maximum Loan Amount.
1.3 "MAXIMUM LOAN AMOUNT" shall mean the sum of Thirteen Million
Five Hundred Thousand Dollars ($13,500,000.00), less the then unpaid principal
balance under the Construction Loan.
1.4 "NOTE" shall mean the Promissory Note described in SECTION
2.29 of the Receivables Loan Agreement, as modified and amended pursuant to that
Allonge to Receivables Promissory Note of even date herewith executed by
Borrower and Lender.
1.5 "PROJECT" shall mean the time-share condominium project
known as Cypress Pointe Resort, constructed and/or to be constructed by Borrower
in Orlando, Florida, comprised of 84 time-share units.
2. LIMITATION ON ADVANCES. At no time during the Borrowing Term
----------------------
shall the unpaid principal balance of the Receivables Loan, together with the
unpaid principal balance of the Construction Loan, exceed a total amount equal
to Thirteen Million Five Hundred Thousand Dollars ($13,500,000.00) (the "Advance
Limitation"), and Lender shall have no obligation to make any Advance under the
Loan if such Advance would cause the Advance Limitation to be exceeded.
3. INTERVAL RELEASES. SECTION 3.8 of the Receivables Loan
-----------------
Agreement, as added pursuant to the First Amendment, is hereby modified as
follows: the reference to SECTION 5.20(i) of the Construction Mortgage is hereby
amended and shall hereafter include SECTIONS 5.20(i) and 5.20(ii) of the
Construction Mortgage.
4. INCENTIVE FEE. As additional consideration to Lender, Borrower
-------------
shall pay to Lender an incentive fee equal to Thirty Thousand Six Hundred
Dollars ($30,600.00) with respect to the time-share interests sold by Borrower
in Building 3 (as defined in the Construction Loan Agreement) of the Project
("Building3 Intervals"). Such incentive fee shall be paid in installments of
Fifty Dollars ($50.00) per Building 3 Interval, plus related reasonable fees and
expenses (as set forth in the
- 2 -
Mortgage). If not already paid, such incentive fee shall be paid in full upon
the date the Construction Loan is due and payable in full. Nothing contained
herein shall modify, amend or limit the incentive fee payable by Borrower
pursuant to SECTION 8.25 of the Receivables Loan Agreement.
5. CONFIRMATION OF REPRESENTATIONS, WARRANTIES AND AGREEMENTS.
----------------------------------------------------------
Borrower hereby reaffirms, as if made as of the date hereof, all of Borrower's
representations and warranties contained in the Receivables Loan Agreement.
Borrower furthermore reaffirms the validity, enforceability and legality of the
Documents, and all provisions of the Documents as modified of even date herewith
are hereby confirmed and ratified. However, in the event of a conflict or
inconsistency between the provisions of the Receivables Loan Agreement, the
First Amendment and this Second Amendment, the provisions of this Second
Amendment shall prevail.
6. GUARANTORS' RATIFICATION. As a condition precedent to the
------------------------
effectiveness of this Second Amendment, Borrower shall cause the Guarantors to
each execute a Ratification and Confirmation of Guarantee and Subordination
Agreement in the forms attached hereto as EXHIBITS "B" and "C", thereby
acknowledging the making of the agreements contained herein.
7. DOCUMENT REFERENCE. All references to the "Loan Agreement" in
------------------
the Documents are hereby amended to refer to the Receivables Loan Agreement as
hereby amended.
8. CONTINUATION OF PROVISIONS. All terms, conditions and provisions
--------------------------
of the Receivables Loan Agreement, as modified by the First Amendment, are
continued in full force and effect and shall remain unaffected and unchanged
except as specifically amended or modified hereby.
9. CONDITIONS PRECEDENT. The amendments and modifications to
--------------------
the Receivables Loan Agreement contained herein shall not be binding upon Lender
until Lender shall have received all of the following:
(a) An original of this Second Amendment fully executed by the
Borrower;
(b) An original of the Allonge to Receivables Promissory Note in
the form attached hereto as EXHIBIT "A ", fully executed by Borrower;
(c) Ratification and Confirmation of Corporate Guarantee and
Subordination Agreement in the form attached hereto as EXHIBIT "B ",
fully executed by Argosy Group, Inc.;
- 3 -
(d) Ratification and Confirmation of Partnership Guarantee and
Subordination Agreement in the form attached hereto as Exhibit "C",
fully executed by Argosy Canyon Investments, L.P.;
(e) All documents required to be executed and delivered to Lender
in connection with the concurrent amendment and modification of the
Construction Loan Agreement; and
(f) Such resolutions and authorizations and such other documents
as Lender may require relating to the existence and good standing of the
Borrower and any Guarantor, and the authority of any person executing
this Second Amendment or any other documents on behalf of the Borrower
or Guarantors.
IN WITNESS WHEREOF, these presents are executed as of the date first
indicated above.
"BORROWER"
CYPRESS POINTE RESORTS, L.P.,
a Delaware limited partnership
By: ARGOSY GROUP, INC., a Georgia
corporation, General Partner
By /s/ ILLEGIBLE SIGNATURE
---------------------------
Its Vice President
---------------------------
"LENDER"
GREYHOUND FINANCIAL
CORPORATION, a Delaware corporation
By /s/ ILLEGIBLE SIGNATURE
---------------------------
Its Sr. Vice President
---------------------------
- 4 -
THIRD AMENDMENT TO LOAN
AND SECURITY AGREEMENT
THIS THIRD AMENDMENT TO LOAN AND SECURITY AGREEMENT ("Third
Amendment") is made and entered into as of the 7th day of April, 1993, by and
between CYPRESS POINTE RESORTS, L.P., a Delaware limited partnership
("Borrower"), and GREYHOUND FINANCIAL CORPORATION, a Delaware corporation
("Lender").
WITNESSETH:
WHEREAS, as of December 19, 1991, Borrower and Lender's predecessor in
interest, Greyhound Real Estate Finance Company, an Arizona corporation
("GREFCO"), entered into that Loan and Security Agreement (the "Original
Agreement") pursuant to which Lender agreed to make a revolving loan to Borrower
for the purposes set forth therein; and
WHEREAS, Borrower and GREFCO modified and amended the Original
Agreement pursuant to that Amendment to Loan and Security Agreement and Consent
and Agreement of Guarantors dated as of November 9, 1992 (the "First
Amendment"); and
WHEREAS, pursuant to that Assignment dated as of January 13, 1993,
between GREFCO and Lender, GREFCO assigned to Lender all of GREFCO's rights and
obligations under the Original Agreement and the First Amendment and all other
documents and instruments executed in connection therewith; and
WHEREAS, pursuant to that Second Amendment to Loan and Security
Agreement dated as of January 13, 1993 ("the Second Amendment"), Lender and
Borrower amended the Original Agreement and First Amendment in certain respects;
and
WHEREAS, Borrower and Lender have agreed to further amend the Original
Agreement, First Amendment and Second Amendment pursuant to the terms and
provisions of this Third Amendment.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties agree as follows:
1. Definitions. Except as specifically set forth in and/or modified
-----------
by this Third Amendment, all capitalized terms set forth herein shall have the
meanings set forth therefor in the Original Agreement, First Amendment or Second
Amendment, as the case may be. However, the following capitalized terms shall
have the meanings set forth below, notwithstanding any contrary definitions
contained in the Original Agreement, First Amendment or Second Amendment.
1.1 "BORROWING TERM" shall mean the period of time during which
Lender is committed to make advances under the Receivables Loan Agreement,
which commitment shall terminate on the earlier of (a) the date which
occurs twelve (12) months after the date of the first Advance which is made
by Lender after the date of this Third Amendment or (b) June 9, 1994.
1.2 "CONSTRUCTION LOAN AGREEMENT" shall mean that certain
Construction Loan Agreement dated as of December 19, 1991, between Borrower
and GREFCO, as modified and amended pursuant to that First Amendment to
Construction Loan Agreement, dated as of January 13, 1993 between Borrower
and Lender, as further modified and amended pursuant to the Second
Amendment to Construction Loan Agreement of even date herewith between
Borrower and Lender, and as from time to time further modified, extended,
renewed, replaced or restated.
1.3 "CONTROL" shall mean, in connection with the definition of
Affiliate, the possession, directly or indirectly, of the power to direct
or cause the direction of the management and policies of another person or
entity, whether through the ownership of voting securities, by contract or
otherwise. For purposes hereof, any person or entity which owns or
controls, directly or indirectly, five percent (5%) or more of the
securities or ownership interest, whether voting or nonvoting, of any other
person or entity shall be deemed to Control such person or entity.
1.4 "LOAN" shall mean the line of credit loan extended by Lender
to Borrower in accordance with the terms of the Receivables Loan Agreement
in a principal amount not to exceed at any time outstanding the Maximum
Loan Amount.
1.5 "MATURITY DATE" shall mean that date which shall occur seven
(7) years after the date on which the last Advance is made under the terms
of the Original Agreement as modified by this Third Amendment.
1.6 "MAXIMUM LOAN AMOUNT" shall mean the sum of Twenty Million
Dollars ($20,000,000.00); provided, however, that if at any time during the
Borrowing Term the unpaid principal balance under the
- 2 -
Construction Loan exceeds $2,000,000.00, then the Maximum Loan Amount shall
be reduced by the amount that the unpaid principal balance of the
Construction Loan exceeds $2,000,000.00 until the unpaid principal balance
of the Construction Loan is reduced to $2,000,000.00 or less.
1.7 "CONSTRUCTION MORTGAGE" shall mean, collectively, that
certain Mortgage, Assignment of Rents and Proceeds and Security Agreement
dated as of December 19, 1991 between Borrower and GREFCO; as amended by
that certain First Amendment to Mortgage, Assignment of Rents and Proceeds
and Security Agreement dated as of January 13, 1993 between Borrower and
Lender; and as further amended by that certain Second Amendment to
Mortgage, Assignment of Rents and Proceeds and Security Agreement of even
date herewith between Lender and Borrower.
1.8 "NOTE" shall mean the Promissory Note defined in the
Original Agreement, as modified and amended pursuant to that Second Allonge
to Receivables Promissory Note of even date herewith executed by Borrower
and Lender.
1.9 "NONCONFORMING INSTRUMENTS" shall mean those Instruments
described below and which, in all other respects, constitute Eligible
Instruments:
The Instruments provide for consecutive monthly installments of
principal and interest in U.S. funds over a term not exceeding one hundred
twenty (120) months from the date of its execution, with interest accruing
on the unpaid principal balance of the Instrument at a rate not less than
10.9% per annum and the Borrower has received from the Purchaser issuing
such Instrument a minimum cash down payment of 10% of the total sales
price, no part of which has been advanced or loaned to such Purchaser by
Borrower or any Guarantor, directly or indirectly; or
1.10 "OPENING PREPAYMENT DATE" shall mean the date which occurs
twenty-four (24) months after the date on which the last Advance is made
under the terms of the Original Agreement as amended by this Third
Amendment.
1.11 "PREVAILING DISCOUNT RATE" shall mean Lender's prevailing
discount rate at the time each Advance is made, which rate shall be Prime
Rate plus 2% per annum, but in no event less than 11.5% per annum.
- 3 -
1.12 "PROJECT" shall mean the time-share condominium project known
as Cypress Pointe Resort, constructed and to be constructed by Borrower in
Orlando, Florida, comprised of 84 time-share units.
1.13 "RECEIVABLES LOAN AGREEMENT" shall mean, collectively, the
Original Agreement, the First Amendment, the Second Amendment and the Third
Amendment.
2. ADDITIONAL INSTRUMENTS. Exhibit "B" to the Original Agreement,
----------------------
constituting Eligibility Criteria, shall be amended with the addition of the
following subparagraphs:
(j) The Instrument provides for consecutive monthly installments of
principal and interest in U.S. funds over a term not exceeding sixty (60) months
from the date of its execution, with interest accruing on the unpaid principal
balance of the Instrument at a rate of not less than 9.9% per annum and Borrower
has received from the Purchaser issuing such Instrument a minimum cash down
payment of 50% of the total sales price no part of which has been advanced or
loaned to such Purchaser by Borrower or any Guarantor, directly or indirectly;
or;
(k) The Instrument provides for consecutive monthly installments of
principal and interest in U.S. funds over a term not exceeding twenty-four (24)
months from the date of its execution, does not accrue interest and the Borrower
has received from the Purchaser issuing such Instrument a minimum cash down
payment of 33% of the total sales price no part of which has been advanced or
loaned to such Purchaser by Borrower or any Guarantor, directly or indirectly.
The foregoing subcategories of Instruments are hereinafter referred
to as "Conforming Instruments."
The foregoing notwithstanding, in the event as of the end of any
calendar quarter, commencing with the calendar quarter ending on June 30, 1993,
the delinquency rate of either of the foregoing subcategories of Conforming
Instruments then constituting Receivables Collateral exceeds an amount that
Lender deems material, then upon written notice to Borrower, all Conforming
Instruments which thereafter fall within such subcategory and constitute
Receivables Collateral shall thereafter be deemed Nonconforming Instruments.
3. PREPAYMENT. The Loan may be prepaid as provided in the Original
----------
Agreement; provided however that for purposes of determining when and under what
-------- -------
circumstances a prepayment may occur, the elapsed time of the term of the
- 4 -
Loan shall be measured from the date on which the last Advance is made under the
terms of the Original Agreement, as amended by this Third Amendment.
4. LIMITATION ON ADVANCES. At no time during the Term shall the unpaid
----------------------
principal balance of the Loan, together with the unpaid principal balance of the
Construction Loan, exceed a total amount equal to Twenty-Two Million Dollars
($22,000,000.00) (the "Advance Limitation"), and Lender shall have no obligation
to make any Advance under the Loan if such Advance would cause the Advance
Limitation to be exceeded.
5. INTERVAL RELEASES. SECTION 3.8 of the Original Agreement, as added
-----------------
pursuant to the First Amendment, is hereby modified as follows: the reference to
SECTION 5.20(i) of the Construction Mortgage is hereby amended and shall
hereafter include SECTIONS 5.20(i) and 5.20(iii) of the Construction Mortgage.
6. FEES AND EXPENSES. In addition to the fees and expenses which have
-----------------
been paid or are payable by Borrower pursuant to SECTION 8.16 of the Receivables
Loan Agreement, Borrower shall pay to Lender a nonrefundable commitment fee (the
"Commitment Fee") in the amount of $70,000, which nonrefundable fee was earned
by Lender in consideration of Lender holding itself ready, willing and able to
amend the Receivables Loan Agreement upon the terms and conditions set forth
herein. The payment of the Commitment Fee is in addition to Borrower's
obligation to pay a commitment fee to Lender for the Lender's commitment to
modify and amend the Construction Loan Agreement and in addition to all other
fees and expenses required to be paid by Borrower pursuant to the Second
Amendment to Construction Loan Agreement of even date herewith. The Commitment
Fee shall be due and payable in full not later than the date of the next Advance
after the date hereof or on July 23, 1993, whichever shall occur first.
Furthermore, Borrower shall pay, on demand, all costs and expenses arising from
the preparation of this Third Amendment, the Closing of the amendment to the
Construction Loan Documents, the issuing of Lender's commitment to make the
Building 6 Advance, the making of the Building 6 Advance, or otherwise incurred
by Lender in connection with this Third Amendment, including, but not limited
to, title insurance premiums, other title company charges, recording fees, all
charges for consumer credit and Xxxxxx'x reports, and U.C.C., tax lien, judgment
and litigation searches, Lender's attorneys' fees and costs, appraisal fees, if
any, survey costs, if any, inspection costs and fees, both during construction
or otherwise, escrow disbursement expenses, any revenue and/or documentary
stamps, intangible or recording taxes, out-of-pocket travel expenses incurred by
Lender or its agents and employees, brokerage commissions, all fees and expenses
of the Servicing Agent and Collection Agent in connection with this Third
Amendment, a nonrefundable documentation fee of $10,000 (which constitutes the
same documentation fee due under the Construction Loan Agreement), which shall
be credited against Lender's attorneys' fees ($7,500 of which shall be payable
upon full
- 5 -
execution of this Third Amendment and the balance of which shall be payable on
April 30, 1993), and any other costs, expenses or charges that may be imposed on
or incurred by Lender as a result of this Amendment.
7. RENEWAL FEE. In addition to the fees and expenses described in
------------
Section 6 above, Borrower shall pay to Lender a nonrefundable renewal fee (the
"Renewal Fee") which shall equal the product obtained when (i) one-twelfth of
one percent of the Unused Availability (as hereinafter defined), (ii) is
multiplied by the number of full or partial calendar months between March 31,
1993 and the end of the Borrowing Term. The Renewal Fee is paid in consideration
of Lender holding itself ready, willing and able to renew and extend the Loan
upon the terms and conditions set forth herein, and shall be due and payable in
full on April 15, 1993. For purposes of this Section, the term Unused
Availability shall mean the difference obtained when $13,500,000 is reduced by
the unpaid principal balance of the Loan as of March 31, 1993.
8. INCENTIVE FEE.
-------------
(i) As additional consideration to Lender, Borrower shall pay
to Lender an incentive fee (the "Building 6 Incentive Fee") equal to Sixty-
One Thousand Two Hundred Dollars ($61,200.00) with respect to the Time-
Share Interests sold by Borrower in Building 6 (as defined in the
Construction Loan Agreement) ("Building 6 Intervals"). The Building 6
Incentive Fee shall be paid in installments equal to $500 per Building 6
Interval, plus related reasonable fees and expenses (all as set forth in
the Mortgage), commencing with the first sale of a Building 6 Interval
occurring after the Building 6 Maturity Date (as defined in the
Construction Loan Agreement), and continuing until the entire Building 6
Incentive Fee is paid in full. Notwithstanding anything contained herein to
the contrary, the Building 6 Incentive Fee is payable in full by Borrower
on the first day of the 21st month after the making of the first Building 6
Advance (as defined in the Construction Loan Agreement).
(ii) The provisions of paragraph 4 of the Second Amendment,
dealing with the payment by Borrower to Lender of an Incentive Fee with
respect to Time-Share Interests sold by Borrower in Building 3 (as defined
in the Construction Loan Agreement) shall be amended in its entirety to
read as follows:
4. Incentive Fee. As additional consideration to Lender,
-------------
Borrower shall pay to Lender an incentive fee (the "Building 3 Incentive Fee")
equal to $30,600 with respect to Time-Share Interests sold by Borrower in
Building 3 (as defined in the Construction Loan
- 6 -
Agreement) of the Project ("Building 3 Intervals"). The Building 3
Incentive Fee shall be paid in installments equal to $500 per Building
3 Interval, plus related fees and expenses (all as set forth in the
Mortgage), commencing with all sales occurring after October 31, 1993,
and continuing until the entire Building 3 Incentive Fee is paid in
full. Notwithstanding anything contained herein to the contrary, the
Building 3 Incentive Fee is payable in full by Borrower on the 1st
day of the 26th month after the initial Advance of the proceeds of the
Construction Loan.
(iii) Nothing contained herein shall modify, amend or limit the
incentive fee payable by Borrower pursuant to SECTION 8.25 of the
Receivables Loan Agreement with respect to the initial 48 Units of the
Project.
9. CONFIRMATION OF REPRESENTATIONS, WARRANTIES AND AGREEMENTS.
----------------------------------------------------------
Borrower hereby reaffirms, as if made as of the date hereof, all of Borrower's
representations and warranties contained in the Receivables Loan Agreement.
Borrower furthermore reaffirms the validity, enforceability and legality of the
Documents, and all provisions of the Documents, as modified, are hereby
confirmed and ratified. Without limiting the generality of the foregoing,
Borrower hereby reaffirms the validity and enforceability of the Security
Interest granted to Lender in the Receivables Collateral and the Residual
Collateral as security for Borrower's payment and Performance of all
Obligations, other than those Obligations arising out of the Environmental
Certificate with Representations, Covenants and Warranties delivered in
connection with the Construction Loan Agreement. Borrower hereby acknowledges
and agrees that the definition of Obligations includes, without limitation, each
and every obligation, duty, covenant, undertaking and condition which Borrower
is required or has agreed to perform under the Documents and under the
Construction Loan Documents, and each and every obligation of Borrower now or
hereafter owing to Lender. In the event of a conflict or inconsistency between
the provisions of the Original Agreement, the First Amendment and the Second
Amendment, on the one hand, and the provisions of this Third Amendment, on the
other hand, the provisions of this Third Amendment shall prevail.
10. ASSOCIATION FINANCIAL STATEMENTS. Borrower shall supply to Lender,
--------------------------------
no later than April 30, 1993, a copy of the 1992 fiscal year-end financial
statements for each of the Association and the Borrower in the forms required by
SECTION 8.11(c) of the Original Agreement. Financial statements for the
Association and for the Borrower for subsequent fiscal years shall be delivered
within the 90-day period (as to the Association) and 120-day period (as to the
Borrower) set forth in SECTION 8.11(c).
- 7 -
11. SUBORDINATION. The provisions of SECTION 8.12 of the Original
-------------
Agreement shall be amended in its entirety to read as follows:
All indebtedness owed by the Borrower to its partners or
Affiliates and all other indebtedness owed by Borrower shall be
subordinated to the indebtedness of Borrower to Lender, under terms and
conditions acceptable to Lender. Such Subordination Agreement shall,
without limitation, (i) permit the payment of regularly scheduled
installments of subordinated indebtedness in the absence of an Event of
Default and (ii) prohibit the payment of any subordinated indebtedness and
prohibit the exercise of any remedies against Borrower upon and during the
continuance of an Event of Default.
12. NET WORTH. The provisions of SECTION 8.22(a) of the Original
---------
Agreement shall be amended in its entirety to read as follows:
(a) As of the end of each fiscal quarter of Borrower, Borrower
shall maintain a net worth, calculated in accordance with generally
accepted accounting principles, consistently applied ("GAAP"), of at least
Six Million Dollars ($6,000,000).
13. ADDITIONAL UNITS. The provisions of SECTION 8.23 of the Original
----------------
Agreement shall be amended in its entirety to read as follows:
8.23 Borrower shall not, without Lender's prior written consent:
(i) Construct additional condominium or time-share units within or adjacent
to the Project (other than the time-share units comprising the Project)
until at least 50% of the total Time-Share Interests in the Project have
been sold, in bona fide transactions, to parties not Affiliated with
Borrower or (ii) sell time-share intervals from such additional condominium
or time-share units until at least 75% of the total Time-Share Interests
contained within the Project have been sold, in bona fide transactions, to
parties not Affiliated with Borrower.
14. GUARANTORS' RATIFICATION. As a condition precedent to the
------------------------
effectiveness of this Third Amendment, Borrower shall cause the Guarantors to
each execute a Ratification and Confirmation of Guarantee and Subordination
Agreement in the forms attached hereto as EXHIBITS "A" and "B", thereby
acknowledging the making of the agreements contained herein.
15. DOCUMENT REFERENCE. All references to the "Loan Agreement" in the
------------------
Documents are hereby amended to refer to the Receivables Loan Agreement.
- 8 -
16. CONTINUATION OF PROVISIONS. All terms, conditions and provisions
--------------------------
of the Original Agreement, First Amendment and Second Amendment are continued in
full force and effect and shall remain unaffected and unchanged except as
specifically amended or modified hereby. Without limiting the generality of the
foregoing, an Event of Default shall be deemed to exist in the event there
occurs an Event of Default under and as defined in the Construction Loan
Agreement or in the event there occurs an act or event under any of the
Construction Loan Documents, whether or not denominated as an "Event of
Default," which expressly entitles the Lender to exercise its remedies. Borrower
acknowledges that as of the date hereof, it has (i) no defense, counterclaim,
offset, cross-complaint, claim or demand of any nature whatsoever which can be
asserted as a basis to seek affirmative relief or damages from Lender or as a
basis to reduce or eliminate all or any part of its liability to repay the Loan
and (ii) no other claim against Lender with respect to any aspect of the
transaction in respect to which the Loan was made.
17. CONDITIONS PRECEDENT. The amendments and modifications to the
--------------------
Receivables Loan Agreement contained herein and Lender's obligations in this
regard are subject to the following express conditions precedent:
17.1 The following shall be delivered to Lender all in a form,
manner and substance satisfactory to Lender:
(a) An original of this Third Amendment fully executed by
the Borrower;
(b) An original of the Second Allonge to Receivables
Promissory Note in a form acceptable to Lender, fully executed by
Borrower;
(c) An original Second Modification to Mortgage, Assignment
of Rents and Proceeds and Security Agreement in a form acceptable to
Lender, fully executed by Borrower (the "Second Mortgage
Modification");
(d) Ratification and Confirmation of Corporate Guarantee and
Subordination Agreement in the form attached hereto as EXHIBIT "A",
fully executed by Argosy Group, Inc.;
(e) Ratification and Confirmation of Partnership Guarantee
and Subordination Agreement in the form attached hereto as EXHIBIT
"B", fully executed by Argosy Canyon Investments, L.P.;
- 9 -
(f) Current updates of those opinion letters received by Lender
in connection with the Construction Loan Agreement from Xxxxxxxxx,
Xxxxxxx & Flint and Xxxxxxxx & Xxxxxxxx;
(g) All documents required to be executed and delivered to Lender
in connection with the amendment and modification of the Construction
Loan Agreement;
(h) Such resolutions and authorizations and such other documents
as Lender may require relating to the existence and good standing of
the Borrower and Guarantors, and the authority of any person executing
this Second Amendment or any other documents on behalf of the Borrower
or Guarantors; and
(i) A commitment from First American Title Insurance Company, the
issuer of Lender's ALTA extended coverage title insurance policy in
connection with the Construction Loan Agreement (the "Title Policy"),
to issue an endorsement, in form satisfactory to Lender, to Lender's
Title Policy, insuring that the Construction Mortgage, as modified
pursuant to the Second Mortgage Modification, continues to be a first
lien upon the real property described therein, as security for, among
other things, the timely and faithful payment of the Building 6
Incentive Fee, subject only to those exceptions contained in such
title policy and to such additional exceptions as Lender may
specifically approve in writing.
(j) Evidence that the Real Property is environmentally acceptable
to Lender. Lender has the right to require that Borrower retain the
services of a firm acceptable to Lender and knowledgeable in
environmental matters to perform a Phase I environmental assessment
(and if requested by Lender, a site audit and regulatory compliance
evaluation) of the Real Property and surrounding area. Such
assessment, audit and evaluation (collectively, the "Investigation")
may include, but not be limited to, soil and ground water testing to
fully identify the scope of any environmental issues impacting the
subject transaction. All costs incurred in performing the
Investigation shall be borne by Borrower. The scope and results of the
Investigation must be satisfactory to Lender. All costs associated
with complying with EPA and other federal, state and local
environmental standards, as indicated by the Investigation, shall be
the sole responsibility of Borrower.
(k) Updated UCC, tax lien, litigation and judgment searches for
the following parties: (i) Borrower, (ii) Argosy Group,
- 10 -
Inc., (iii) Argosy Canyon Investments, L.P., (iv) Xxxx Xxxxxx, (v)
Xxxxxx X. Xxxxxx, (vi) Vacation Ownership Marketing, Inc., dba Cypress
Pointe Marketing Company, and (vii) Essex Builders Group, together
with Bishops Reports for Xxxxxx X. Xxxxxx and Xxxx Xxxxxx.
(1) Evidence that Borrower has good and marketable title to the
collateral pledged to Lender, that Lender's liens and security
interest in such collateral have been duly perfected as first and
prior liens and security interests, and that there are no other
financing statements or liens filed against Borrower or on the
property of Borrower except those that are approved by Lender.
(m) Evidence that any fees due to any broker utilized by Borrower
in connection with the subject transaction have been paid, together
with evidence of the payment by Borrower of any other costs, fees and
expenses then payable in connection with the Construction Loan and the
Loan, including, without limitation, those fees, costs and expenses
described in Section 6 hereof.
(n) Such documents, instruments and agreements as Lender may
require to effectuate the provisions of SECTION 11 hereof.
17.2 No Event of Default shall exist and no event or condition
shall exist which after notice or lapse of time, or both, would constitute
an Event of Default.
17.3 There shall have occurred no material adverse change in the
Real Property or in the business or financial condition of Borrower and
Guarantor since the date of the last financial statement submitted to
Lender.
17.4 Neither Borrower nor Guarantor shall have failed to
disclosure to Lender any material information and no material information
supplied by Borrower or Guarantor shall be found to be misleading,
misrepresented or materially incorrect.
17.5 All representations and warranties by Borrower shall remain
true and correct, in all material respects, and all agreements the Borrower
is to have performed or complied with at such time shall have been
performed or complied with.
17.6 Borrower and E.S. Financial, Inc. ("Servicer") shall
acknowledge, in writing, in a form acceptable to Lender, Lender's
unilateral right to terminate the Servicing Agreement between Lender,
Servicer,
- 11 -
Borrower and Old Kent Bank and Trust Company dated May ____, 1992, pursuant
to Section 2.5(b) thereof.
IN WITNESS WHEREOF, these presents are executed as of the date first
indicated above.
"BORROWER"
CYPRESS POINTE RESORTS, L.P.,
a Delaware limited partnership
By: ARGOSY GROUP, INC.,
a Georgia corporation,
General Xxxxxx
By /s/ [ILLEGIBLE SIGNATURE]
--------------------------
Its Vice President
--------------------------
"LENDER"
GREYHOUND FINANCIAL CORPORATION,
a Delaware corporation
By /s/ [ILLEGIBLE SIGNATURE]
--------------------------
Its Vice President
--------------------------
- 12 -
FOURTH AMENDMENT TO LOAN AND SECURITY AGREEMENT
THIS FOURTH AMENDMENT TO LOAN AND SECURITY AGREEMENT ("Fourth
Amendment") is made and entered into as of the 16th day of December, 1993, by
and between CYPRESS POINTE RESORTS, L.P., a Delaware limited partnership
("Borrower"), and GREYHOUND FINANCIAL CORPORATION, a Delaware corporation
("Lender").
WITNESSETH:
WHEREAS, as of December 19, 1991, Borrower and Lender's predecessor in
interest, Greyhound Real Estate Finance Company, an Arizona corporation
("GREFCO"), entered into that Loan and Security Agreement (the "Original
Agreement") pursuant to which Lender agreed to make a revolving loan to Borrower
for the purposes set forth therein; and
WHEREAS, Borrower and GREFCO modified and amended the Original
Agreement pursuant to that Amendment to Loan and Security Agreement and Consent
and Agreement of Guarantors dated as of November 9, 1992 (the "First
Amendment"); and
WHEREAS, pursuant to that Assignment dated as of January 13, 1993,
between GREFCO and Lender, GREFCO assigned to Lender all of GREFCO's rights and
obligations under the Original Agreement and the First Amendment and all other
documents and instruments executed in connection therewith; and
WHEREAS, pursuant to that Second Amendment to Loan and Security
Agreement dated as of January 13, 1993 (the "Second Amendment"), Lender and
Borrower amended the Original Agreement and First Amendment in certain respects;
and
WHEREAS, pursuant to that Third Amendment to Loan and Security
Agreement dated as of April 7, 1993 (the "Third Amendment"), Lender and Borrower
amended the Original Agreement, First Amendment, and Second Amendment in certain
respects; and
WHEREAS, Borrower and Lender have agreed to renew and further amend
the Original Agreement, First Amendment, Second Amendment and Third Amendment
pursuant to the terms and provisions of this Fourth Amendment.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties agree as follows:
1. DEFINITIONS. Except as specifically set forth in and/or modified
-----------
by this Fourth Amendment, all capitalized terms set forth herein shall have the
meanings set forth therefor in the Original Agreement, First Amendment, Second
Amendment or Third Amendment, as the case may be. However, the following
capitalized terms shall have the meanings set forth below, notwithstanding any
contrary definitions contained in the Original Agreement, First Amendment,
Second Amendment or Third Amendment.
1.1 "BIENNIAL YEAR" shall mean each odd-numbered calendar year
thereafter arising or each even-numbered calendar year thereafter arising.
1.2 "BORROWING BASE" shall mean an amount equal to the lesser of
(i) ninety percent (90%) of the unpaid principal balance payable under the
Eligible Instruments, or (ii) ninety percent (90%) of the then present
value assigned to the unmatured installments of principal and interest
payable under the Eligible Instruments discounted at Lender's Prevailing
Discount Rate.
1.3 "BORROWING TERM" shall mean the period of time during which
Lender is committed to make advances under the Receivables Loan Agreement,
which commitment shall terminate on the earlier of (a) the date which
occurs eighteen (18) months after the date of the first Advance which is
made by Lender after the date of this Fourth Amendment or (b) September 13,
1995.
1.4 "CONSTRUCTION LOAN AGREEMENT" shall mean that certain
Construction Loan Agreement dated as of December 19, 1991, between Borrower
and GREFCO, as modified and amended pursuant to that First Amendment to
Construction Loan Agreement, dated as of January 13, 1993 between Borrower
and Lender, and as modified and amended pursuant to that Second Amendment
to Construction Loan Agreement dated as of April 7, 1993 between Borrower
and Lender, and as further modified and amended pursuant to that Third
Amendment to Construction Loan Agreement of even date herewith between
Borrower and Lender and as from time to time further modified, extended,
renewed, replaced or restated.
1.5. "CONSTRUCTION MORTGAGE" shall mean, collectively, that
certain Mortgage, Assignment of Rents and Proceeds and Security Agreement
dated as of December 19, 1991 between Borrower and GREFCO; as amended by
that certain First Amendment to Mortgage, Assignment of Rents and
- 2 -
Proceeds and Security Agreement dated as of January 13, 1993 between
Borrower and Lender; and as amended by that certain Second Amendment to
Mortgage, Assignment of Rents and Proceeds and Security Agreement dated as
of April 7, 1993 between Borrower and Lender; and as further amended by
that certain Third Amendment to Mortgage, Assignment of Rents and Proceeds
and Security Agreement of even date herewith between Lender and Borrower.
1.6. "DELINQUENCY BALANCE" shall mean, individually and
collectively, the unpaid principal balance due and owing under an
Instrument, the installment payments under which have become more than 59
days past due and against which an Advance has been made.
1.7. "ELIGIBLE INSTRUMENTS" shall mean the Instruments, each in
substantially the form of Exhibit "A" appended to the Original Agreement,
entered into by and between Borrower and those Persons who purchase a Time-
Share Interest ((i) at least eighty percent (80%) of whom shall be
residents of the United States, Canada or Puerto Rico, (ii) no more than
twenty percent (20%) of whom shall be residents of countries or territories
other than the United States, Canada or Puerto Rico, and (iii) no more than
fifteen percent (15%) of whom shall be residents of Great Britain), which
Eligible Instruments shall conform to the criteria and standards set forth
on Exhibit "B" appended to the Original Agreement, as amended; provided,
---------
however, that an Instrument shall cease to be an Eligible Instrument if (i)
-------
any installment payable thereunder, becomes more than fifty-nine (59) days
past due and the Instrument under which such installment is payable is not
replaced within ninety (90) days following the due date of such
installment, or (ii) the contract fails to continue to conform to the
criteria and standards set forth on Exhibit "B" appended to the Original
Agreement, as amended.
1.8. "FOREIGN INSTRUMENT" shall mean an Instrument delivered by
a Purchaser who is not a resident of the United States, Canada or Puerto
Rico.
1.9. "MATURITY DATE" shall mean that date which shall occur
seven (7) years after the date on which the last Advance is made under the
terms of the Original Agreement as modified by this Fourth Amendment.
1.10. "NOTE" shall mean the Promissory Note defined in the
Original Agreement, as previously modified and amended and as further
modified and amended pursuant to that Third Allonge to Receivables
Promissory Note of even date herewith executed by Borrower and Lender.
- 3 -
1.11 "OPENING PREPAYMENT DATE" shall mean the date which occurs
twenty-four (24) months after the date on which the last Advance is made under
the terms of the Original Agreement as amended by this Fourth Amendment.
1.12 "PROJECT" shall mean the time-share condominium project known as
Cypress Pointe Resort, constructed and to be constructed by Borrower in Orlando,
Florida, comprised of 108 time-share units.
1.13 "RECEIVABLES LOAN AGREEMENT" shall mean collectively, the
Original Agreement, the First Amendment, the Second Amendment, the Third
Amendment and the Fourth Amendment.
1.14 "TIME-SHARE INTEREST" shall mean the rights sold to a Purchaser
to the exclusive use of a Unit in the Project and the Project common areas for a
one (1) week period during each calendar year or during each Biennial Year.
2. PREPAYMENT. The Loan may be prepaid as provided in the Original
----------
Agreement; provided however that for purposes of determining when and under what
-------- -------
circumstances a prepayment may occur, the elapsed time of the term of the Loan
shall be measured from the date on which the last Advance is made under the
terms of the Original Agreement, as amended by this Fourth Amendment.
3. INTERVAL RELEASES. SECTION 3.8 of the Original Agreement, as
-----------------
added pursuant to the First Amendment, is hereby modified as follows: the
reference to SECTION 5.20(i) of the Construction Mortgage is hereby amended and
shall hereafter include SECTIONS 5.20(i), 5.20(iii) and 5.20(iv) of the
Construction Mortgage.
4. FOREIGN INSTRUMENTS. Exhibit "B " of the Original Agreement,
-------------------
constituting Eligibility Criteria, shall be amended with the addition of the
following subparagraph:
(1) In the event the Instrument is a Foreign Instrument, such
Instrument provides for consecutive monthly installments of principal and
interest in U.S. funds over a term not exceeding sixty (60) months from the date
of its execution, with interest accruing on the unpaid principal balance of the
Foreign Instrument at a rate not less than 10.9% per annum; Borrower has
received from the Purchaser issuing such Foreign Instrument a minimum cash down
payment of thirty percent (30%) of the total sales price, no part of which has
been advanced or loaned to such Purchaser by Borrower or Guarantor, directly or
indirectly; and Borrower has the right to collect monthly payments due and owing
on such Foreign Instrument by debiting such Purchaser's credit
- 4 -
card, which credit card shall be a Visa, Master Card or other
internationally recognized credit card.
5. DELINQUENCY. A SECTION 3.9 shall be added to the Original
-----------
Agreement reading as follows:
3.9 In addition to any other rights and remedies available to
Lender, Lender shall have no obligation of making an Advance against
Foreign Instruments that constitute Eligible Instruments in the event, as
of the end of any three (3) consecutive calendar months during the
Borrowing Term, the Delinquency Balance under Foreign Instruments exceeds
three percent (3%) of the aggregate then unpaid principal balance of all
Foreign Instruments against which an Advance has been made; provided,
--------
however, in the event, as of the end of any three (3) consecutive calendar
-------
months thereafter during the Borrowing Term (the "Cure Period"), the
Delinquency Balance on Foreign Instruments is equal to or less than three
percent (3%) of the aggregate then unpaid principal balance of all Foreign
Instruments against which an Advance has been made, then, subject to
satisfaction of all other conditions precedent to the making of an Advance,
Lender shall make Advances against Foreign Instruments; provided further
----------------
that in the event as of the end of any three (3) consecutive calendar
----
months during the Borrowing Term but following the Cure Period, the
Delinquency Balance under Foreign Instruments exceeds three percent (3%) of
the aggregate then unpaid principal balance of all Foreign Instruments
against which an Advance has been made, Lender shall have no further
obligation to make Advances against Foreign Instruments; it being agreed
and understood that Borrower shall be entitled to only one Cure Period
during the Borrowing Term.
6. NET WORTH. The provisions of SECTION &22(a) of the Original
---------
Agreement, as modified by the Third Amendment, shall be amended in its entirety
to read as follows:
(a) As of the end of each fiscal quarter of Borrower, Borrower
shall maintain a net worth, calculated in accordance with generally
accepted accounting principles, consistently applied ("GAAP"), of at least
Seven Million Dollars ($7,000,000).
7. FEES AND EXPENSES. In addition to the fees and expenses which
-----------------
have been paid or are payable by Borrower pursuant to SECTION 8.16 of the
Receivables Loan Agreement, Borrower shall pay to Lender, on demand, all costs
and expenses arising from the preparation of this Fourth Amendment, or otherwise
incurred by Lender in connection with this Fourth Amendment, including, but not
limited to, title insurance premiums, other title company charges, recording
fees, all charges for
- 5 -
consumer credit and Xxxxxx'x reports, and U.C.C., tax lien, judgment and
litigation searches, Lender's attorneys' fees and costs, appraisal fees, if
any, survey costs, if any, inspection costs and fees, both during construction
or otherwise, escrow disbursement expenses, any revenue and/or documentary
stamps, intangible or recording taxes, out-of-pocket travel expenses incurred
by Lender or its agents and employees, brokerage commissions, all fees and
expenses of the Servicing Agent and Collection Agent in connection with this
Fourth Amendment, a nonrefundable documentation fee of $12,500 (which
constitutes the same documentation fee due under the Construction Loan
Agreement), which shall be credited against Lender's attorneys' fees and any
other costs, expenses or charges that may be imposed on or incurred by Lender
as a result of this Fourth Amendment.
8. RENEWAL FEE. In addition to the fees and expenses described in
-----------
SECTION 7 above, Borrower shall pay to Lender a nonrefundable renewal fee (the
"Renewal Fee") which shall equal the product obtained when (i) one-twelfth of
one percent of the Unused Availability (as hereinafter defined), (ii) is
multiplied by the number of full or partial calendar months between March 31,
1994 and the end of the Borrowing Term. The Renewal Fee is paid in
consideration of Lender holding itself ready, willing and able to renew and
extend the Loan upon the terms and conditions set forth herein, has been
earned, and shall be due and payable in full on March 31, 1994. For purposes of
this Section, the term Unused Availability shall mean the difference obtained
when $20,000,000 is reduced by the unpaid principal balance of the Loan as of
March 31, 1994. The Renewal Fee is in addition to Borrower's obligation to pay
a commitment fee (the "Commitment Fee") to Lender for Lender's commitment to
modify and amend the Construction Loan Agreement and in addition to all other
fees and expenses required to be paid by Borrower pursuant to the Third
Amendment to Construction Loan Agreement of even date herewith.
9. INCENTIVE FEE. As additional consideration to Lender, Borrower
-------------
shall pay to Lender an incentive fee (the "Building 5 Incentive Fee") equal to
Seventy-Three Thousand Four Hundred Forty Dollars ($73,440.00) with respect to
the Time-Share Interests sold by Borrower in Building 5 (as defined in the
Construction Loan Agreement) ("Building 5 Intervals"). The Building 5 Incentive
Fee shall be paid in installments equal to $2,325 per Building 5 Interval (or
$1,165 in the event Building 5 Interval is a Time Share Interest to be used in
a Biennial Year), plus related reasonable fees and expenses (all as set forth
in the Mortgage), commencing with the first sale of a Building 5 Interval
occurring after the earlier of (i) payment in full of all Building 5 Advances
(as defined in the Construction Loan Agreement) and accrued interest thereon or
(ii) the Building 5 Maturity Date (as defined in the Construction Loan
Agreement), and continuing until the entire Building 5 Incentive Fee is paid in
full. Notwithstanding anything contained herein to the contrary, the Building 5
Incentive Fee is payable in full by Borrower on the first day of the 281h month
after the making of the first Building 5 Advance.
- 6 -
10. CONFIRMATION OF REPRESENTATIONS, WARRANTIES AND AGREEMENTS. Borrower
----------------------------------------------------------
hereby reaffirms, as if made as of the date hereof, all of Borrower's
representations and warranties contained in the Receivables Loan Agreement.
Borrower furthermore reaffirms the validity, enforceability and legality of the
Documents, and all provisions of the Documents, as modified, are hereby
confirmed and ratified. Without limiting the generality of the foregoing,
Borrower hereby reaffirms the validity and enforceability of the Security
Interest granted to Lender in the Receivables Collateral and the Residual
Collateral as security for Borrower's payment and Performance of all
Obligations, other than those Obligations arising out of the Environmental
Certificate with Representations, Covenants and Warranties delivered in
connection with the Construction Loan Agreement. Borrower hereby acknowledges
and agrees that the definition of Obligations includes, without limitation, each
and every obligation, duty, covenant, undertaking and condition which Borrower
is required or has agreed to perform under the Documents and under the
Construction Loan Documents, and each and every obligation of Borrower now or
hereafter owing to Lender. In the event of a conflict or inconsistency between
the provisions of the Original Agreement, the First Amendment, the Second
Amendment and the Third Amendment, on the one hand, and the provisions of this
Fourth Amendment, on the other hand, the provisions of this Fourth Amendment
shall prevail.
11. ADDITIONAL UNITS. The provisions of SECTION 8.23 of the Original
-----------------
Agreement as amended by Section 13 of the Second Amendment shall be amended in
its entirety to read as follows:
8.23 Borrower shall not, without Lender's prior written consent:
(i) Construct additional condominium or time-share units within or adjacent
to the Project (other than the time-share units comprising the Project)
until at least 50% of the total Time-Share Interests in Building 5 have
been sold, in bona fide transactions, to parties not Affiliated with
Borrower, (ii) sell time-share intervals from such additional condominium
or time-share units until at least 75% of the total Time-Share Interests
contained within Building 5 have been sold, in bona fide transactions, to
parties not Affiliated with Borrower, or (iii) commence sales of Time-Share
Interests in Building 5 until at least 75% of the Time-Share Interests in
Building 6 (as defined in the Construction Loan Agreement) have been sold
in bona fide transactions, to parties not Affiliated with Borrower, with
Guarantor, with any partners of Borrower or with any partners of Guarantor.
12. GUARANTORS' RATIFICATION. As a condition precedent to the
------------------------
effectiveness of this Fourth Amendment, Borrower shall cause the Guarantors to
each execute a Ratification and Confirmation of Guarantee and Subordination
Agreement in
- 7 -
forms acceptable to Lender, thereby acknowledging the making of the agreements
contained herein.
13. DOCUMENT REFERENCE. All references to the "Loan Agreement" in the
------------------
Documents are hereby amended to refer to the Receivables Loan Agreement.
14. CONTINUATION OF PROVISIONS. All terms, conditions and provisions
--------------------------
of the Original Agreement, First Amendment, Second Amendment and Third Amendment
are continued in full force and effect and shall remain unaffected and unchanged
except as specifically amended or modified hereby. Without limiting the
generality of the foregoing, an Event of Default shall be deemed to exist in the
event there occurs an Event of Default under and as defined in the Construction
Loan Agreement or in the event there occurs an act or event under any of the
Construction Loan Documents, whether or not denominated as an "Event of
Default," which expressly entitles the Lender to exercise its remedies. Borrower
acknowledges that as of the date hereof, it has (i) no defense, counterclaim,
offset, cross-complaint, claim or demand of any nature whatsoever which can be
asserted as a basis to seek affirmative relief or damages from Lender or as a
basis to reduce or eliminate all or any part of its liability to repay the Loan
and (ii) no other claim against Lender with respect to any aspect of the
transaction in respect to which the Loan was made. That certain letter agreement
from Lender to Borrower dated October 13, 1993 is merged into this Fourth
Amendment and such letter agreement shall, from and after the date hereof, have
no further force or effect.
15. CONDITIONS PRECEDENT. The amendments and modifications to the
--------------------
Receivables Loan Agreement contained herein and Lender's obligations in this
regard are subject to the following express conditions precedent:
15.1 The following shall be delivered to Lender all in a form,
manner and substance satisfactory to Lender:
(a) An original of this Fourth Amendment fully executed by
the Borrower;
(b) An original of the Third Allonge to Receivables
Promissory Note in a form acceptable to Lender, fully executed by
Borrower;
(c) An original Third Modification to Mortgage, Assignment
of Rents and Proceeds and Security Agreement in a form acceptable to
Lender, fully executed by Borrower (the "Third Mortgage
Modification");
- 8 -
(d) An original Ratification and Confirmation of Corporate
Guarantee and Subordination Agreement in a form acceptable to Lender,
fully executed by Argosy Group, Inc.;
(e) An original Ratification and Confirmation of Partnership
Guarantee and Subordination Agreement in a form acceptable to Lender,
fully executed by Argosy Canyon Investments, L.P.;
(f) Current updates of the opinion letter received by
Lender in connection with the Receivables Loan Agreement from
Xxxxxxxxx, Xxxxxxx & Xxxxx together with an opinion letter from
Borrower's counsel with respect to the service of process and
foreclosure procedures available in the State of Florida with respect
to Purchaser who are not residents of the United States or Canada;
(g) All documents required to be executed and delivered to
Lender in connection with the amendment and modification of the
Construction Loan Agreement;
(h) Such resolutions and authorizations and such other
documents as Lender may require relating to the existence and good
standing of the Borrower and Guarantors, and the authority of any
person executing this Fourth Amendment or any other documents on
behalf of the Borrower or Guarantors; and
(i) A commitment from First American Title Insurance
Company, the issuer of Lenders ALTA extended coverage title insurance
policy in connection with the Construction Loan Agreement (the "Title
Policy"), to issue an endorsement, in form satisfactory to Lender, to
Lender's Title Policy, insuring that the Construction Mortgage, as
modified pursuant to the Third Mortgage Modification, continues to be
a first lien upon the real property described therein, as security
for, among other things, the timely and faithful payment of the
Building 5 Incentive Fee, subject only to those exceptions contained
in such title policy and to such additional exceptions as Lender may
specifically approve in writing.
(j) Evidence that the Real Property is environmentally
acceptable to Lender. Lender has the right to require that Borrower
retain the services of a firm acceptable to Lender and knowledgeable
in environmental matters to perform a Phase I environmental assessment
(and if requested by Lender, a site audit and regulatory compliance
- 9 -
evaluation) of the Real Property and surrounding area. Such
assessment, audit and evaluation (collectively, the "Investigation")
may include, but not be limited to, soil and ground water testing to
fully identify the scope of any environmental issues impacting the
subject transaction. All costs incurred in performing the
Investigation shall be borne by Borrower. The scope and results of the
Investigation must be satisfactory to Lender. All costs associated
with complying with EPA and other federal, state and local
environmental standards, as indicated by the Investigation, shall be
the sole responsibility of Borrower.
(k) Updated UCC, tax lien, litigation and judgment searches
for the following parties: (i) Borrower, (ii) Argosy Group, Inc.,
(iii) Argosy Canyon Investments, L.P., (iv) Xxxx Xxxxxx, (v) Xxxxxx X.
Xxxxxx, (vi) Vacation Ownership Marketing, Inc., dba Cypress Pointe
Marketing Company, and (vii) Essex Builders Group.
(l) Evidence that Borrower has good and marketable title
to the collateral pledged to Lender, that Lender's liens and security
interest in such collateral have been duly perfected as first and
prior liens and security interests, and that there are no other
financing statements or liens filed against Borrower or on the
property of Borrower except those that are approved by Lender.
(m) Evidence that any fees due to any broker utilized by
Borrower in connection with the subject transaction have been paid,
together with evidence of the payment by Borrower of any other costs,
fees and expenses then payable in connection with the Construction
Loan and the Loan, including, without limitation, those fees, costs
and expenses described in SECTION 7 and SECTION 8 hereof.
15.2. No Event of Default shall exist and no event or condition
shall exist which after notice or lapse of time, or both, would constitute
an Event of Default
15.3. There shall have occurred no material adverse change in the
Real Property or in the business or financial condition of Borrower and
Guarantor since the date of the last financial statement submitted to
Lender.
15.4. Neither Borrower nor Guarantor shall have failed to
disclosure to Lender any material information and no material information
supplied by Borrower or Guarantor shall be found to be misleading,
misrepresented or materially incorrect.
- 10 -
l5.5. All representations and warranties by Borrower shall remain true
and correct, in all material respects, and all agreements the Borrower is to
have performed or complied with at such time shall have been performed or
complied with.
IN WITNESS WHEREOF, these presents are executed as of the date first
indicated above.
"BORROWER"
CYPRESS POINTE RESORTS, L.P.,
a Delaware limited partnership
By: ARGOSY GROUP, INC., a Georgia
corporation, General Partner
By /s/ [ILLEGIBLE SIGNATURE]
---------------------------
Its Secretary
--------------------------
"LENDER"
GREYHOUND FINANCIAL
CORPORATION, a Delaware corporation
By /s/ [ILLEGIBLE SIGNATURE]
--------------------------------
Its SENIOR VICE PRESIDENT
--------------------------------
- 11 -
FIFTH AMENDMENT TO LOAN
AND SECURITY AGREEMENT
----------------------
THIS FIFTH AMENDMENT TO LOAN AND SECURITY AGREEMENT ("Fifth
Amendment") is made and entered into as of the 28th day of June, 1994, by and
between CYPRESS POINTE RESORTS, L.P., a Delaware limited partnership
("Borrower"), and GREYHOUND FINANCIAL CORPORATION, a Delaware corporation
("Lender").
WITNESSETH:
WHEREAS, as of December 19, 1991, Borrower and Lender's predecessor in
interest, Greyhound Real Estate Finance Company, an Arizona corporation
("GREFCO"), entered into that Loan and Security Agreement (the "Original
Agreement") pursuant to which Lender agreed to make a revolving loan to Borrower
for the purposes set forth therein; and
WHEREAS, Borrower and GREFCO modified and amended the Original
Agreement pursuant to that Amendment to Loan and Security Agreement and Consent
and Agreement of Guarantors dated as of November 9, 1992 (the "First
Amendment"); and
WHEREAS, pursuant to that Assignment dated as of January 13, 1993,
between GREFCO and Lender, GREFCO assigned to Lender all of GREFCO's rights and
obligations under the Original Agreement and the First Amendment and all other
documents and instruments executed in connection therewith; and
WHEREAS, pursuant to that Second Amendment to Loan and Security
Agreement dated as of January 13, 1993 (the "Second Amendment"), Lender and
Borrower amended the Original Agreement and First Amendment in certain respects;
and
WHEREAS, pursuant to that Third Amendment to Loan and Security
Agreement dated as of April 7, 1993 (the "Third Amendment"), Lender and Borrower
amended the Original Agreement, First Amendment, and Second Amendment in certain
respects; and
WHEREAS, pursuant to that Fourth Amendment to Loan and Security
Agreement dated as of December 16, 1993 (the "Fourth Amendment"), Lender and
Borrower amended the Original Agreement, First Amendment, Second Amendment and
Third Amendment in certain respects; and
WHEREAS, Borrower and Lender have agreed to further amend the Original
Agreement, First Amendment, Second Amendment, Third Amendment and Fourth
Amendment pursuant to the terms and provisions of this Fifth Amendment.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties agree as follows:
1. Definitions. Except as specifically set forth in and/or modified
-----------
by this Fifth Amendment, all capitalized terms set forth herein shall have the
meanings set forth therefor in the Original Agreement, First Amendment, Second
Amendment, Third Amendment or Fourth Amendment, as the case may be. However, the
following capitalized terms shall have the meanings set forth below,
notwithstanding any contrary definitions contained in the Original Agreement,
First Amendment, Second Amendment, Third Amendment or Fourth Amendment.
1.1 "CONSTRUCTION LOAN AGREEMENT" shall mean that certain
Construction Loan Agreement dated as of December 19, 1991, between Borrower
and GREFCO, as modified and amended pursuant to that First Amendment to
Construction Loan Agreement, dated as of January 13, 1993 between Borrower
and Lender, and as modified and amended pursuant to that Second Amendment
to Construction Loan Agreement dated as of April 7, 1993 between Borrower
and Lender, as further modified and amended pursuant to that Third
Amendment to Construction Loan Agreement dated as of December 16, 1993
between Borrower and Lender, and as further modified and amended pursuant
to that Fourth Amendment to Construction Loan Agreement of even date
herewith between Borrower and Lender and as from time to time further
modified, extended, renewed, replaced or restated.
1.2. "CONSTRUCTION MORTGAGE" shall mean, collectively, that
certain Mortgage, Assignment of Rents and Proceeds and Security Agreement
dated as of December 19, 1991 between Borrower and GREFCO; as amended by
that certain First Amendment to Mortgage, Assignment of Rents and Proceeds
and Security Agreement dated as of January 13, 1993 between Borrower and
Lender, as amended by that certain Second Amendment to Mortgage, Assignment
of Rents and Proceeds and Security Agreement dated as of April 7, 1993
between Borrower and Lender; as further amended by that certain Third
Amendment to Mortgage, Assignment of Rents and Proceeds and Security
Agreement dated as of December 16, 1993 between Borrower and Lender, and as
further amended by that certain Fourth Amendment to Mortgage, Assignment of
Rents and Proceeds and Security Agreement of even date herewith between
Borrower and Lender.
- 2 -
1.3 "PROJECT" shall mean the time-share condominium project
known as Cypress Pointe Resort, constructed and to be constructed by Borrower in
Orlando, Florida, comprised of 144 time-share units.
1.4 "RECEIVABLES LOAN AGREEMENT" shall mean, collectively, the
Original Agreement, the First Amendment, the Second Amendment, the Third
Amendment, the Fourth Amendment and the Fifth Amendment.
2. Fees and Expenses. In addition to the fees and expenses which
-----------------
have been paid or are payable by Borrower pursuant to Section 8.16 of the
Receivables Lean Agreement, Borrower shall pay to Lender, on demand, all costs
and expenses arising from the preparation of this Fifth Amendment, or otherwise
incurred by Lender in connection with this Fifth Amendment, including but not
limited to, title insurance premiums, other title company charges, recording
fees, all charges for consumer credit and Xxxxxx'x reports, and U.C.C., tax
lien, judgment and litigation searches, Lenders attorneys' fees and costs,
appraisal fees, if any, survey costs, if any, inspection costs and fees, both
during construction or otherwise, escrow disbursement expenses, any revenue
and/or documentary stamps, intangible or recording taxes, out-of-pocket travel
expenses incurred by Lender or its agents and employees, brokerage commissions,
all fees and expenses of the Servicing Agent and Collection Agent in connection
with this Fifth Amendment, Lender's counsel's attorneys' fees, which fees,
together with the fees payable in connection with the amendments of even date
herewith to the Construction Loan Agreement, shall not exceed $12,500, Lender's
counsel's out-of-pocket costs and expenses, and any other costs, expenses or
charges that may be imposed on or incurred by Lender as a result of this Fifth
Amendment.
3. Incentive Fee. As additional consideration to Lender, Borrower
-------------
shall pay to Lender an incentive fee (the "Building 7 Incentive Fee") equal to
Seventy-Three Thousand Four Hundred Forty Dollars ($73,440.00) with respect to
the Time-Share Interests sold by Borrower in Building 7 (as defined in the
Construction Lean Agreement) ("Building 7 Intervals"). The Building 7 Incentive
Fee shall be paid in installments equal to $2,175 per Building 7 Interval (or
$1,090 in the event Building 7 Interval is a Time Share Interest to be used in a
Biennial Year), plus related reasonable fees and expenses (all as set forth in
the Mortgage), commencing with the first sale of a Building 7 Interval occurring
after the earlier of (i) payment in full of all Building 7 Advances (as defined
in the Construction Lean Agreement) and accrued interest thereon or (ii) the
Building 7 Maturity Date (as defined in the Construction Loan Agreement), and
continuing until the entire Building 7 Incentive Fee is paid in full.
Notwithstanding anything contained herein to the contrary, the Building 7
Incentive Fee is payable in full by Borrower on the first day of the 24th month
after the making of the first Building 7 Advance.
- 3 -
4. Confirmation of Representations, Warranties and Agreements.
----------------------------------------------------------
Borrower hereby reaffirms, as if made as of the date hereof, all of Borrower's
representations and warranties contained in the Receivables Loan Agreement.
Borrower furthermore reaffirms the validity, enforceability and legality of the
Documents, and all provisions of the Documents, as modified, are hereby
confirmed and ratified. Without limiting the generality of the foregoing,
Borrower hereby reaffirms the validity and enforceability of the Security
Interest granted to Lender in the Receivables Collateral and the Residual
Collateral as security for Borrower's payment and Performance of all
Obligations, other than those Obligations arising out of the Environmental
Certificate with Representations, Covenants and Warranties delivered in
connection with the Construction Loan Agreement. Borrower hereby acknowledges
and agrees that the definition of Obligations includes, without limitation, each
and every obligation, duty, covenant, undertaking and condition which Borrower
is required or has agreed to perform under the Documents and under the
Construction Loan Documents, and each and every obligation of Borrower now or
hereafter owing to Lender. In the event of a conflict or inconsistency between
the provisions of the Original Agreement, the First Amendment, the Second
Amendment, the Third Amendment and the Fourth Amendment, on the one hand, and
the provisions of this Fifth Amendment, on the other hand, the provisions of
this Fifth Amendment shall prevail.
5. Nonconforming Instruments. The provisions of Section 3.7 of the
-------------------------
Original Agreement, added to the Original Agreement pursuant to the First
Amendment, shall be amended in its entirety to read as follows:
3.7 Lender will make Advances against Nonconforming Instruments
on the condition that (i) such Instruments otherwise qualify as
Eligible Instruments, (ii) at no time during the Term shall the total
amount advanced against Nonconforming Instruments, less payments
received by Lender under such Instruments, exceed $6,000,000.00; (iii)
Borrower is otherwise entitled to an Advance under the provisions of
the Receivables Agreement and (iv) the Delinquency Balance under
Nonconforming Instruments as of the end of any preceding three (3)
consecutive calendar months during the Borrowing Tetra does not exceed
three percent (3%) of the aggregate then unpaid principal balance of
all Nonconforming Instruments against which an Advance has been made.
In the event Lender does not make an Advance against Nonconforming
Instruments as a result of the occurrence of the event set forth in
clause (iv) above, but as of the end of any three (3) consecutive
calendar months thereafter during the Borrowing Term (the
"Nonconforming Instrument Cure Period"), the Delinquency Balance on
Nonconforming Instruments is equal to or less than three percent (3%)
of the aggregate then unpaid principal balance
- 4 -
of all Nonconforming Instruments against which an Advance has been
made, then, subject to the satisfaction of all other conditions
precedent to the making of an Advance, Lender shall make an Advance
against Nonconforming Instruments; provided further that in the event
as of the end of any three (3) consecutive calendar months during the
Borrowing Term but following the Nonconforming Instrument Cure Period,
the Delinquency Balance under Nonconforming Instruments exceeds three
percent (3%) of the aggregate then unpaid principal balance of all of
Nonconforming Instruments against which an Advance has been made,
Lender shall have no further obligation to make Advances against
Nonconforming Instruments; it being agreed and understood that
Borrower shall be entitled to only one Nonconforming Instrument Cure
Period during the Borrowing Term. At all times during which the
Nonconforming Instrument Ratio is in excess of thirty percent (30%),
the Nonconforming Borrowing Base shall be used for purposes of
determining the amount of Advances to be made against Nonconforming
Instruments. Borrower shall not permit the Nonconforming Instrument
Ratio to be in excess of thirty percent (30%) for a period in excess
of sixty (60) days at any time during the Term.
6. Additional Units. The provisions of Section 8.23 of the Original
----------------
Agreement as amended by Section 13 of the Second Amendment and Section 11 of the
Fourth Amendment shall be amended in their entirety to read as follows:
8.23 Borrower shall not, without Lender's prior written consent:
(i) construct additional condominium or time-share units within or
adjacent to the Project (other than the time-share units comprising
the Project) until at least 50% of the total Time-Share Interests in
each of Buildings 5 and 7 have been sold, in bona fide transactions,
to parties not Affiliated with Borrower, (ii) sell time-share
intervals from such additional condominium or time-share units until
at least 75% of the total Time-Share Interests contained within each
of Braidings 5 and 7 have been sold, in bona fide transactions, to
parties not Affiliated with Borrower, (iii) commence sales of Time-
Share Interests in Building 5 until at least 75% of the Time-Share
Interests in Building 6 (as defined in the Construction Loan
Agreement) have been sold in bona fide transactions, to parties not
Affiliated with Borrower, with Guarantor, with any partners of
Borrower or with any partners of Guarantor, (iv) commence sales of
Time-Share Interests in Building 7 until at least 75% of the Time-
Share Interests in Building 5 have been sold in bona fide
transactions, to parties not Affiliated with Borrower, with Guarantor,
with any partners of Borrower or with any partners of Guarantor, or
(v) commence construction of Building 7 until sales of Time-Share
Interests in Building 5 have commenced.
- 5 -
7. Guarantors' Ratification. As a condition precedent to the
------------------------
effectiveness of this Fifth Amendment, Borrower shall cause the Guarantors to
each execute a Ratification and Confirmation of Guarantee and Subordination
Agreement in forms acceptable to Lender, thereby acknowledging the making of the
agreements contained herein.
8. Continuation of Provisions. All terms, conditions and provisions
--------------------------
of the Original Agreement, First Amendment, Second Amendment, Third Amendment
and Fourth Amendment are continued in full force and effect and shall remain
unaffected and unchanged except as specifically amended or modified hereby.
Without limiting the generality of the foregoing an Event of Default shall be
deemed to exist in the event there occurs an Event of Default under and as
defined in the Construction Loan Agreement or in the event there occurs an act
or event under any of the Construction Loan Documents, whether or not
denominated as an "Event of Default," which expressly entitles the Lender to
exercise its remedies. Borrower acknowledges that as of the date hereof, it has
(i) no defense, counterclaim, offset, cross-complaint, claim or demand of any
nature whatsoever which can be asserted as a basis to seek affirmative relief or
damages from Lender or as a basis to reduce or eliminate all or any part of its
liability to repay the Loan and (ii) no other claim against Lender with respect
to any aspect of the transaction in respect to which the Loan was made. That
certain financing proposal from Lender to Borrower dated May 1O, 1994 is merged
into this Fifth Amendment and such financing proposal shall, from and after the
date hereof, have no further force or effect.
9. Conditions Precedent. The amendments and modifications to
--------------------
the Receivables Loan Agreement contained herein and Lender's obligations in this
regard are subject to the following express conditions precedent:
9.1 The following shall be delivered to Lender all in a form,
manner and substance satisfactory to Lender:
(a) An original of this Fifth Amendment fully executed by
the Borrower;
(b) An original Fourth Modification to Mortgage, Assignment
of Rents and Proceeds and Security Agreement in a form acceptable to
Lender, fully executed by Borrower (the "Fourth Mortgage
Modification");
(c) An original Ratification and Confirmation of Corporate
Guarantee and Subordination Agreement in a form acceptable to Lender,
fully executed by Argosy Group, Inc.;
- 6 -
(d) An original Ratification and Confirmation of Partnership
Guarantee and Subordination Agreement in a form acceptable to Lender,
fully executed by Argosy Canyon Investments, L.P.;
(e) Current updates of the opinion letter received by Lender
in connection with the Receivables Loan Agreement from Xxxxxxxxx,
Xxxxxxx & Flint;
(f) All documents required to be executed and delivered to
Lender in connection with the amendment and modification of the
Construction Loan Agreement;
(g) Such resolutions and authorizations and such other
documents as Lender may require relating to the existence and good
standing of the Borrower and Guarantors, and the authority of any
person executing this Fifth Amendment or any other documents on behalf
of the Borrower or Guarantors;
(h) A commitment from First American Title Insurance
Company, the issuer of Lender's ALTA extended coverage title insurance
policy in connection with the Construction Loan Agreement (the "Title
Policy"), to issue an endorsement, in form satisfactory to Lender, to
Lender's Title Policy, insuring that the Construction Mortgage, as
modified pursuant to the Fourth Mortgage Modification, continues to be
a first lien upon the real property described therein, as security
for, among other things, the timely and faithful payment of the
Building 7 Incentive Fee, subject only to those exceptions contained
in such title policy and to such additional exceptions as Lender may
specifically approve in writing;
(i) Evidence that the Real Property is environmentally
acceptable to Lender, Lender has the fight to require that Borrower
the services as a firm acceptable to Lender and knowledgeable in
environmental matters to perform a Phase I environmental assessment
(and if requested by Lender, a site audit and regulator compliance
evaluation) of the Real Property and surrounding area. Such
assessment, audit and evaluation (collectively, the "Investigation")
may include, but not be limited to, soil and ground water testing to
fully identify the scope of any environmental issues impacting the
subject transaction. All costs incurred in performing the
Investigation shall be borne by Borrower. The scope and results of the
Investigation must be satisfactory to Lender. All costs associated
with complying with EPA
- 7 -
and other federal, state and local environmental standards, as
indicated by the Investigation, shall be the sole responsibility of
Borrower;
(j) Updated Dun & Bradstreet report for Borrower and updated
UCC, tax lien, litigation and judgment searches for the following
parties: (i) Borrower, (ii) Argosy Group, Inc., and (iii) Argosy
Canyon Investments, L.P.;
(k) Evidence that Borrower has good and marketable title to
the collateral pledged to Lender, that Lender's liens and security
interest in such collateral have been duly perfected as first and
prior liens and security interests, and that there are no other
financing statements or liens filed against Borrower or on the
property of Borrower except those that are approved by Lender; and
(l) Evidence that any fees due to any broker utilized by
Borrower in connection with the subject transaction have been paid,
together with evidence of the payment by Borrower of any other costs,
fees and expenses then payable in connection with the Construction
Loan and the Loan, including, without limitation, those fees, costs
and expenses described in Section 2 and Section 3 hereof.
9.2. No Event of Default shall exist and no event or condition
shall exist which after notice or lapse of time, or both, would constitute
an Event of Default
9.3 There shall have occurred no material adverse change in the
Real Property or in the business or financial condition of Borrower and
Guarantor singe the date of the last financial statement submitted to
Lender.
9.4. Neither Borrower nor Guarantor shall have failed to disclose
to Lender any material information and no material information supplied by
Borrower or Guarantor shall be found to be misleading, misrepresented or
materially incorrect.
9.5. All representations and warranties by Borrower shall remain
true and correct, in all material respects, and all agreements the Borrower is
to have performed or complied with at such time shall have been performed or
complied with.
IN WITNESS WHEREOF, these presents are executed as of the date first
indicated above.
- 8 -
"BORROWER"
CYPRESS POINTE RESORTS, L.P.,
a Delaware limited partnership
By: ARGOSY GROUP, INC., a Georgia
corporation, General Partner
By /s/ [SIGNATURE ILLEGIBLE]
-------------------------------
Its Vice President
"LENDER"
GREYHOUND FINANCIAL
CORPORATION, a Delaware
corporation
By /s/ [SIGNATURE ILLEGIBLE]
-----------------------------------
Its SENIOR VICE PRESIDENT
- 9 -
SIXTH AMENDMENT TO LOAN
AND SECURITY AGREEMENT
-----------------------
THIS SIXTH AMENDMENT TO LOAN AND SECURITY AGREEMENT ("Sixth
Amendment") is made and entered into as of the 16th day of December, 1994, by
and between CYPRESS POINTE RESORTS, L.P., a Delaware limited partnership
("Borrower"), and GREYHOUND FINANCIAL CORPORATION, a Delaware corporation
("Lender").
WITNESSETH:
----------
WHEREAS, as of December 19, 1991, Borrower and Lender's predecessor in
interest, Greyhound Real Estate Finance Company, an Arizona corporation
("GREFCO"), entered into that Loan and Security Agreement (the "Original
Agreement") pursuant to which Lender agreed to make a revolving loan to Borrower
for the purposes set forth therein; and
WHEREAS, Borrower and GREFCO modified and amended the Original
Agreement pursuant to that Amendment to Loan and Security Agreement and Consent
and Agreement of Guarantors dated as of November 9, 1992 (the "First
Amendment"); and
WHEREAS, pursuant to that Assignment dated as of January 13, 1993,
between GREFCO and Lender, GREFCO assigned to Lender all of GREFCO's rights and
obligations under the Original Agreement and the First Amendment and all other
documents and instruments executed in connection therewith; and
WHEREAS, pursuant to that Second Amendment to Loan and Security
Agreement dated as of January 13, 1993 (the "Second Amendment"), Lender and
Borrower amended the Original Agreement and First Amendment in certain respects;
and
WHEREAS, pursuant to that Third Amendment to Loan and Security
Agreement dated as of April 7, 1993 (the "Third Amendment"), Lender and Borrower
amended the Original Agreement, First Amendment, and Second Amendment in certain
respects; and
WHEREAS, pursuant to that Fourth Amendment to Loan and Security
Agreement dated as of December 16, 1993 (the "Fourth Amendment"), Lender and
Borrower amended the Original Agreement, First Amendment, Second Amendment and
Third Amendment in certain respects; and
WHEREAS, pursuant to that Fifth Amendment to Loan and Security
Agreement dated as of June 28, 1994 (the "Fifth Amendment"), Lender and Borrower
amended the Original Agreement, First Amendment, Second Amendment, Third
Amendment and Fourth Amendment in certain respects; and
WHEREAS, Borrower and Lender have agreed to further amend the Original
Agreement, First Amendment, Second Amendment, Third Amendment, Fourth Amendment
and Fifth Amendment pursuant to the terms and provisions of this Sixth
Amendment.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties agree as follows:
1. DEFINITIONS. Except as specifically set forth in and/or modified
-----------
by this Sixth Amendment, all capitalized terms set forth herein shall have the
meanings set forth therefor in the Original Agreement, First Amendment, Second
Amendment, Third Amendment, Fourth Amendment or Fifth Amendment, as the case may
be. However, the following capitalized terms shall have the meanings set forth
below, notwithstanding any contrary definitions contained in the Original
Agreement, First Amendment, Second Amendment, Third Amendment or Fourth
Amendment.
1.1 "BORROWING TERM" shall mean the period of time during which
Lender is committed to make advances under the Receivables Loan Agreement,
which commitment shall terminate on the earlier of (a) the date which
occurs eighteen (18) months after the date of the first Advance which is
made by Lender after the date of this Sixth Amendment or (b) September 9,
1996.
1.2 "ELIGIBLE INSTRUMENTS" shall mean the Instruments, each in
substantially the form of Exhibit "A" appended to the Original Agreement,
entered into by and between Borrower and those Persons who purchase a Time-
Share Interest (at least seventy-five percent (75%) of whom shall be
residents of the United States, Canada or Puerto Rico), which Eligible
Instruments shall conform to the criteria and standards set forth on
Exhibit "A" appended to the Sixth Amendment, as further amended from time
to time; provided, however, that an Instrument shall cease to be an
-----------------
Eligible Instrument if (i) any installment payable thereunder, becomes more
than fifty-nine (59) days past due and the Instrument under which such
installment is payable is not replaced within ninety (90) days following
the due date of such installment, or (ii) the contract fails to continue to
conform to the criteria and standards set forth on Exhibit "A" appended to
the Sixth Amendment, as further amended from time to time.
- 2 -
1.3 "MATURITY DATE" shall mean that date which shall occur ten (10)
years after the date on which the last Advance is made under the terms of
the Original Agreement as modified by this Sixth Amendment.
1.4 "MAXIMUM LOAN AMOUNT" shall mean the sum of Twenty-Five Million
Dollars ($25,000,000.00); provided, however, that if at any time during the
Borrowing Term the unpaid principal balance under the Construction Loan
exceeds $3,000,000.00, then the Maximum Loan Amount shall be reduced by the
amount that the unpaid principal balance of the Construction Loan exceeds
$3,000,000.00 until the unpaid principal balance of the Construction Loan
is reduced to $3,000,000.00 or less.
1.5 "NOTE" shall mean the Promissory Note defined in the Original
Agreement, as previously modified and amended and as further modified and
amended pursuant to that Fourth Allonge to Receivables Promissory Note of
even date herewith executed by Borrower and Lender.
1.6 "OPENING PREPAYMENT DATE" shall mean the date which occurs twenty-
four (24) months after the date on which the last Advance is made under the
terms of the Original Agreement as amended by this Sixth Amendment.
1.7 "RECEIVABLES LOAN AGREEMENT" shall mean, collectively, the
Original Agreement, the First Amendment, the Second Amendment, the Third
Amendment, the Fourth Amendment, the Fifth Amendment and the Sixth
Amendment.
2. ADDITIONAL AMENDMENTS. The Loan Documents shall be further amended as
follows:
2.1 Exhibit "B" to the Original Agreement, constituting the
Eligibility Criteria, as subsequently amended, shall be amended and
restated in its entirety to read as set forth on the attached Exhibit "A",
-----------
incorporated herein by reference.
2.2 The following definitions shall be deleted from the Receivables
Loan Agreement:
(i) Non-Conforming Borrowing Base;
(ii) Non-Conforming Instrument Ratio;
- 3 -
(iii) Non-Conforming Instruments; and
(iv) Conforming Instruments.
2.3 All references in the Receivables Loan Agreement to
Conforming Instruments shall be amended to mean Instruments.
2.4 The provisions of Section 3.7 of the Original Agreement,
added to the Original Agreement pursuant to the First Amendment and
thereafter modified pursuant to the Fifth Amendment, shall be deleted in
its entirety.
3. PREPAYMENT. The Loan may be prepaid as provided in the Original
----------
Agreement; provided however, that for purposes of determining when and under
----------------
what circumstances a prepayment may occur, the elapsed time of the term of the
Loan shall be measured from the date on which the last Advance is made under the
terms of the Original Agreement, as amended by this Sixth Amendment.
4. Limitation on Advances. At no time during the Term shall the
----------------------
unpaid principal balance of the Loan, together with the unpaid principal balance
of the Construction Loan, exceed a total amount equal to Twenty-Eight Million
Dollars ($28,000,000.00) (the "Advance Limitation"), and Lender shall have no
obligation to make any Advance under the Loan if such Advance would cause the
Advance Limitation to be exceeded.
5. RETURN OF INSTRUMENTS. To the extent the Lender has the
---------------------
obligation of returning to Borrower an Instrument in Lender's possession, Lender
will make reasonable efforts to return such Instrument to Borrower no later than
thirty (30) days following the later to occur of (i) the receipt from Borrower
of a form of reassignment acceptable to Lender or (ii) the receipt by Lender of
a servicing report from the Servicing Agent reflecting that Lender has the
obligation of returning such Instrument to Borrower.
6. FEES AND EXPENSES. In addition to the fees and expenses which
-----------------
have been paid or are payable by Borrower pursuant to Section 8.16 of the
Receivables Loan Agreements, Borrower shall pay to Lender a nonrefundable loan
fee (the "Loan Fee") in the amount of $50,000, which nonrefundable fee was
earned by Lender in consideration of Lender holding itself ready, willing and
able to amend the Receivables Loan Agreement upon the terms and conditions set
forth herein. One-half of the Loan Fee shall be due and payable in full not
later than the date of the first Advance after the date hereof or on January 31,
1995, whichever shall occur first, and the remaining one-half of the Loan Fee
shall be due and payable in full not later than the date of the second Advance
after the date hereof or on February 28, 1995,
- 4 -
whichever shall occur first. Furthermore, Borrower shall pay to Lender, on
demand, all costs and expenses arising from the preparation of this Sixth
Amendment, or otherwise incurred by Lender in connection with this Sixth
Amendment, including, but not limited to, title insurance premiums, other title
company charges, recording fees, all charges for consumer credit and Xxxxxx'x
reports, and U.C.C., tax lien, judgment and litigation searches, Lender's
attorneys' fees and costs, appraisal fees, if any, survey costs, if any,
inspection costs and fees, both during construction or otherwise, escrow
disbursement expenses, any revenue and/or documentary stamps, intangible or
recording taxes, out-of-pocket travel expenses incurred by Lender or its agents
and employees, brokerage commissions, all fees and expenses of the Servicing
Agent and Collection Agent in connection with this Sixth Amendment, Lender's
counsel's attorneys' fee (which fees will not exceed $5,000.00 provided that
there are no protracted negotiations among the parties and further provided
that no significant unforeseen issues arise), Lender's counsel's out-of-pocket
costs and expenses, and any other costs, expenses or charges that may be
imposed on or incurred by Lender as a result of this Sixth Amendment.
7. CONFIRMATION OF REPRESENTATIONS, WARRANTIES AND AGREEMENTS.
----------------------------------------------------------
Borrower hereby reaffirms, as if made as of the date hereof, all of Borrower's
representations and warranties contained in the Receivables Loan Agreement.
Without limiting the generality of the foregoing, Borrower represents and
warrants that there has occurred no material adverse change in the Real
Property, Receivables Collateral or Residual Collateral or in the business or
financial condition of Borrower or Guarantor since the date of the last
financial statements submitted to Lender and that neither Borrower nor
Guarantor has failed to disclose to Lender any information material to the
Loan. Borrower furthermore reaffirms the validity, enforceability and legality
of the Documents, and all provisions of the Documents, as modified, are hereby
confirmed and ratified. Without limiting the generality of the foregoing,
Borrower hereby reaffirms the validity and enforceability of the Security
Interest granted to Lender in the Receivables Collateral and the Residual
Collateral as security for Borrower's payment and Performance of all
Obligations, other than those Obligations arising out of the Environmental
Certificate with Representations, Covenants and Warranties delivered in
connection with the Construction Loan Agreement. Borrower hereby acknowledges
and agrees that the definition of Obligations includes, without limitation,
each and every obligation, duty, covenant, undertaking and condition which
Borrower is required or has agreed to perform under the Documents and under the
Construction Loan Documents, and each and every obligation of Borrower now or
hereafter owing to Lender. In the event of a conflict or inconsistency between
the provisions of the Original Agreement, the First Amendment, the Second
Amendment, the Third Amendment, the Fourth Amendment or the Fifth Amendment, on
the one hand, and the provisions of this Sixth Amendment, on the other hand,
the provisions of this Sixth Amendment shall prevail.
- 5 -
8. GUARANTORS' RATIFICATION. As a condition precedent to the
------------------------
effectiveness of this Sixth Amendment, Borrower shall cause the Guarantors to
each execute a Ratification and Confirmation of Guarantee and Subordination
Agreement in forms acceptable to Lender, thereby acknowledging the making of the
agreements contained herein.
9. CONTINUATION OF PROVISIONS. All terms, conditions and provisions
--------------------------
of the Original Agreement, First Amendment, Second Amendment, Third Amendment,
Fourth Amendment and Fifth Amendment are continued in full force and effect and
shall remain unaffected and unchanged except as specifically amended or modified
hereby. Without limiting the generality of the foregoing, an Event of Default
shall be deemed to exist in the event there occurs an Event of Default under and
as defined in the Construction Loan Agreement or in the event there occurs an
act or event under any of the Construction Loan Documents, whether or not
denominated as an "Event of Default," which expressly entitles the Lender to
exercise its remedies. Borrower acknowledges that as of the date hereof, it has
(i) no defense, counterclaim, offset, cross-complaint, claim or demand of any
nature whatsoever which can be asserted as a basis to seek affirmative relief or
damages from Lender or as a basis to reduce or eliminate all or any part of its
liability to repay the Loan and (ii) no other claim against Lender with respect
to any aspect of the transaction in respect to which the Loan was made. That
certain financing proposal from Lender to Borrower dated November 23, 1994, and
that certain letter from Xxxxx Xxxxxxxx & Associates, Inc. to Lender of August
16, 1994, are merged into this Sixth Amendment and such financing proposal and
letter shall, from and after the date hereof, have no further force or effect.
10. CONDITIONS PRECEDENT. The amendments and modifications to the
--------------------
Receivables Loan Agreement contained herein and Lender's obligations in this
regard are subject to the following express conditions precedent:
10.1 The following shall be delivered to Lender all in a form,
manner and substance satisfactory to Lender:
(a) An original of this Sixth Amendment fully executed by
the Borrower;
(b) An original Ratification and Confirmation of Corporate
Guarantee and Subordination Agreement in a form acceptable to
Lender, fully executed by Argosy Group, Inc.;
(c) An original Ratification and Confirmation of
Partnership Guarantee and Subordination Agreement in a form
acceptable to Lender, fully executed by Argosy Canyon Investments,
L.P.;
- 6 -
(d) Current updates of the opinion letter received by
Lender in connection with the Receivables Loan Agreement from
Xxxxxxxxx, Xxxxxxx & Xxxxx;
(e) Such resolutions and authorizations and such other
documents as Lender may require relating to the existence and good
standing of the Borrower and Guarantors, and the authority of any
person executing this Sixth Amendment or any other documents on behalf
of the Borrower or Guarantors;
(f) Updated Dun & Bradstreet report for Borrower and
updated UCC, tax lien, litigation and judgment searches for the
following parties: (i) Borrower, (ii) Argosy Group, Inc., and (iii)
Argosy Canyon Investments, L.P.;
(g) Evidence that Borrower has good and marketable title to
the collateral pledged to Lender, that Lender's liens and security
interest in such collateral have been duly perfected as first and
prior liens and security interests, and that there are no other
financing statements or liens filed against Borrower or on the
property of Borrower except those that are approved by Lender;
(h) Evidence of the payment by Borrower of any costs, fees
and expenses then payable in connection with the Loan, including,
without limitation, those fees, costs and expenses described in
Section 6 hereof; and
(i) A current analysis of the delinquency rate of Foreign
Instruments.
10.2 No Event of Default shall exist and no event or condition
shall exist which after notice or lapse of time, or both, would constitute
an Event of Default.
10.3 There shall have occurred no material adverse change in the
Real Property, the Receivables Collateral or Residual Collateral or in the
business or financial condition of Borrower and Guarantor since the date of
the last financial statement submitted to Lender.
10.4 Neither Borrower nor Guarantor shall have failed to disclose
to Lender any material information and no material information
- 7 -
supplied by Borrower or Guarantor shall be found to be misleading,
misrepresented or materially incorrect.
10.5 All representations and warranties by Borrower shall remain
hue and correct, in all material respects, and all agreements the Borrower
is to have performed or complied with at such time shall have been
performed or complied with.
IN WITNESS WHEREOF, these presents are executed as of the date first
indicated above.
"BORROWER"
CYPRESS POINTE RESORTS, L.P.,
a Delaware limited partnership
By: ARGOSY GROUP, INC., a Georgia
corporation, General Partner
By /s/ [SIGNATURE ILLEGIBLE]
-----------------------------------
Its VICE PRESIDENT
-----------------------------------
"LENDER"
GREYHOUND FINANCIAL
CORPORATION, a Delaware
corporation
By /s/ [SIGNATURE ILLEGIBLE]
------------------------------------
Its SENIOR VICE PRESIDENT
------------------------------------
- 8 -
SEVENTH AMENDMENT TO LOAN
-------------------------
AND SECURITY AGREEMENT
----------------------
THIS SEVENTH AMENDMENT TO LOAN AND SECURITY AGREEMENT ("Seventh
Amendment") is made and entered into as of the 6th day of November, 1995, by and
between CYPRESS POINTE RESORTS, L.P., a Delaware limited partnership
("Borrower") and FINOVA CAPITAL CORPORATION, a Delaware corporation, formerly
known as Greyhound Financial Corporation, ("Lender").
WITNESSETH:
WHEREAS, as of December 19, 1991, Borrower and Lender's predecessor in
interest, Greyhound Real Estate Finance Company, an Arizona corporation
("GREFCO"), entered into that Loan and Security Agreement (the "Original
Agreement") pursuant to which Lender agreed to make a revolving loan to Borrower
for the purposes set forth therein; and
WHEREAS, Borrower and GREFCO modified and amended the Original
Agreement pursuant to that Amendment to Loan and Security Agreement and Consent
and Agreement of Guarantors dated as of November 9, 1992 (the "First
Amendment"); and
WHEREAS, pursuant to that Assignment dated as of January 13, 1993,
between GREFCO and Lender, GREFCO assigned to Lender all of GREFCO's rights and
obligations under the Original Agreement and the First Amendment and all other
documents and instruments executed in connection therewith; and
WHEREAS, pursuant to that Second Amendment to Loan and Security
Agreement dated as of January 13, 1993 (the "Second Amendment"), Lender and
Borrower amended the Original Agreement and First Amendment in certain respects;
and
WHEREAS, pursuant to that Third Amendment to Loan and Security
Agreement dated as of April 7, 1993 (the "Third Amendment"), Lender and Borrower
amended the Original Agreement, First Amendment, and Second Amendment in certain
respects; and
WHEREAS, pursuant to that Fourth Amendment to Loan and Security
Agreement dated as of December 16, 1993 (the "Fourth Amendment"), Lender and
Borrower amended the Original Agreement, First Amendment, Second Amendment and
Third Amendment in certain respects; and
WHEREAS, pursuant to that Fifth Amendment to Loan and Security
Agreement dated as of June 28, 1994 (the "Fifth Amendment"), Lender and Borrower
amended the Original Agreement, First Amendment, Second Amendment, Third
Amendment and Fourth Amendment in certain respects; and
WHEREAS, pursuant to that Sixth Amendment to Loan and Security
Agreement dated as of December 16, 1994 (the "Sixth Amendment"), Lender and
Borrower amended the Original Agreement, First Amendment, Second Amendment,
Third Amendment, Fourth Amendment and Fifth Amendment in certain respects; and
WHEREAS, Borrower and Lender have agreed to further amend the Original
Agreement, First Amendment, Second Amendment, Third Amendment, Fourth Amendment,
Fifth Amendment and Sixth Amendment pursuant to the terms and provisions of this
Seventh Amendment to include, among other things, a working capital loan
facility.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties agree as follows:
1. DEFINITIONS. Except as specifically set forth and/or modified by
-----------
this Seventh Amendment, all capitalized terms set forth herein shall have the
meanings set forth therefor in the Original Agreement, First Amendment, Second
Amendment, Third Amendment, Fourth Amendment, Fifth Amendment or Sixth
Amendment, as the case may be. However, the following capitalized terms shall
have the meanings set forth below, notwithstanding any contrary definitions
contained in the Original Agreement, First Amendment, Second Amendment, Third
Amendment, Fourth Amendment, Fifth Amendment or Sixth Amendment.
"Advance" shall mean, collectively and individually, a Receivables
Advance and a Working Capital Advance.
"Borrowing Base (Receivables Loan)" shall mean an amount equal to
the lesser of (i) 90% of the unpaid principal balance payable under the
Eligible Instruments or (ii) 90% of the then present value assigned to the
unmatured installments of principal and interest payable under the Eligible
Instruments discounted at Lender's Prevailing Discount Rate.
"Borrowing Base (Working Capital Loan)" shall mean an amount equal
to the sum of (A) the lesser of (i) 55% of the unpaid principal balance
payable under the Eligible Instruments against which a Working
- 2 -
Capital Advance will be made or (ii) 55% of the then present value assigned
to the unmatured installments of principal and interest payable under the
Eligible Instruments against which a Working Capital Advance will be made,
discounted at Lender's Prevailing Discount Rate, (B) 55% of any cash down
payments and principal and interest payments then made by the Purchaser
under such Eligible Instruments at the time of such Working Capital
Advance; and (C) 55% of any cash sales of Units then made at the time of
such Working Capital Advance, provided that the proceeds of the cash sales
and such cash down payments and principal and interest payments are held
and shall continue to be held in Escrow by Escrow Agent.
"Borrowing Term (Receivables Loan)" shall mean the period of time
during which Lender is committed to make Receivables Advances under the
Receivables Loan Agreement, which commitment shall terminate on November
30, 1997.
--
"Borrowing Term (Working Capital Loan)" shall mean the period of time
during which Lender is committed to make Working Capital Advances under the
Receivables Loan Agreement, which commitment shall terminate on November
30, 1997.
--
"Building" shall mean either Building 10 or Building 16.
"Building 10" shall mean the 16-unit Building to be constructed on
that portion of the Real Property described in Exhibit "A" attached hereto
-----------
and by this reference incorporated herein.
"Building 16" shall mean the 40-unit Building to be constructed on
that portion of the Real Property described in Exhibit "B" attached hereto
-----------
and by this reference incorporated herein.
"Capital Expenditure" shall mean payments that are made by the
Borrower for the lease, purchase, improvement, construction or use of any
property, the value of which under GAAP is required to be capitalized and
shall include, without limitation, payments for the installment purchase of
property and payments under capitalized leases.
"Cash Flow" shall mean, for any period, the net income or loss of
Borrower, determined in accordance with GAAP (excluding the effect of any
extraordinary gains or losses from the sale of property not in the ordinary
course of business), plus each of the following items to the extent
----
deducted from the revenues of Borrower in calculating the net income: (A)
depreciation;
- 3 -
(B) amortization; and (C) interest and taxes during such period, and less
----
Capital Expenditures to the extent paid in such period.
"Collateral Assignment" shall mean that certain Collateral Assignment,
Security Agreement and Account Agreement of even date with the Seventh
Amendment pursuant to which Borrower collaterally assigns to Lender all of
the Borrower's interest in the Escrow and in the agreement pursuant to
which the Escrow is maintained as security for the payment and Performance
of the Obligations.
"Construction Loan Agreement" shall mean that certain Construction
Loan Agreement dated as of December 19, 1991, between Borrower and GREFCO,
as modified and amended pursuant to that First Amendment to Construction
Loan Agreement, dated as of January 13, 1993 between Borrower and Lender,
as modified and amended pursuant to that Second Amendment to Construction
Loan Agreement dated as of April 7, 1993 between Borrower and Lender, as
further modified and amended pursuant to that Third Amendment to
Construction Loan Agreement dated as of December 16, 1993 between Borrower
and Lender, as further modified and amended pursuant to that Fourth
Amendment to Construction Loan Agreement dated as of June 28, 1994, as
further modified and amended pursuant to that Fifth Amendment to
Construction Loan Agreement dated as of May 10, 1995 between Borrower and
Lender and as further modified and amended pursuant to that Sixth Amendment
to Construction Loan Agreement of even date herewith, between Borrower and
Lender, as from time to time further modified, extended, renewed, replaced
or restated.
"Construction Mortgage" shall mean, collectively, that certain
Mortgage, Assignment of Rents and Proceeds and Security Agreement dated as
of December 19, 1991 between Borrower and GREFCO; as amended by that
certain First Amendment to Mortgage, Assignment of Rents and Proceeds and
Security Agreement dated as of January 13, 1993 between Borrower and
Lender; as amended by that certain Second Amendment to Mortgage, Assignment
of Rents and Proceeds and Security Agreement dated as of April 7, 1993
between Borrower and Lender; as further amended by that certain Third
Amendment to Mortgage, Assignment of Rents and Proceeds and Security
Agreement dated as of December 16, 1993 between Borrower and Lender; as
further amended by that certain Fourth Amendment to Mortgage, Assignment of
Rents and Proceeds and Security Agreement dated as of June 28, 1994 between
Borrower and Lender, as further amended by that certain Fifth Amendment to
Mortgage, Assignment of Rents and Proceeds and Security Agreement dated as
of May 10, 1995 between Borrower and Lender; and as further amended by that
certain Sixth Amendment to Mortgage, Assignment of
- 4 -
Rents and Proceeds and Security Agreement of even date herewith between
Borrower and Lender.
"Delinquencies" shall mean, individually and collectively, an Eligible
Instrument, against which an Advance has been made, under which an
installment payment becomes more than 59 days past due.
"Distributions" shall mean any distribution, advance, payment,
including but not limited to, loan repayments, dividends, bonuses, salary,
other compensation and management fees.
"Documents" shall mean this Agreement, the Note, the Working Capital
Note, the Servicing and Collection Agreement, the Guarantee, the
Assignments, the Subordination Agreement, the Collateral Assignment, and
each and every other document, instrument or writing executed or delivered
by Borrower to Lender in connection with the Loan.
"Escrow" shall mean that certain account in the name of Escrow Agent
in which the cash payments and principal and interest payments that are
used in calculating the Borrowing Base (Working Capital Loan), together
with the original Instruments and Purchaser Mortgages pertaining thereto
are deposited, pursuant to an agreement acceptable to Lender.
"Escrow Agent" shall mean the person who is not an Affiliate of
Borrower, in whose name the Escrow is maintained, the identify of whom
shall be acceptable to Lender.
"Loan" shall mean, collectively and individually, the Receivables Loan
and the Working Capital Loan.
"Maturity Date" shall mean that date which shall occur ten (10) years
after the expiration of the Borrowing Term (Receivables Loan).
"Maximum Loan Amount" shall mean the lesser of (i)Forty Million
Dollars ($40,000,000.00) or (ii) the amount remaining when Forty-Five
Million Dollars ($45,000,000.00) is reduced by the principal amount then
outstanding under each of the Working Capital Loan and the Construction
Loan.
"Maximum Working Capital Loan Amount" shall mean the lesser of (i) One
Million Five Hundred Thousand Dollars ($1,500,000.00) or (ii) the amount
remaining when Forty-Five Million Dollars ($45,000,00000) is
- 5 -
reduced by the principal amount then outstanding under each of the
Receivables Loan and the Construction Loan.
"Net Income" shall mean the net income or loss of Borrower, determined
in accordance with GAAP (excluding the effect of any extraordinary gains or
losses from the sale of property not in the ordinary course of business).
"Note" shall mean the Promissory Note defined in the Original
Agreement, as previously modified and amended and as further modified and
amended pursuant to that Fifth Allonge to Receivables Promissory Note of
even date herewith executed by Borrower and Lender.
"Opening Prepayment Date" shall mean the date which occurs twenty-four
(24) months after the date on which the last Receivables Advance is made
under the terms of the Original Agreement as amended by the Seventh
Amendment.
"Prevailing Discount Rate" shall mean Lender's prevailing discount
rate at the time each Advance is made, which shall be the Prime Rate plus
2.0% but in no event less than 12.5%.
"Project" shall mean the time-share condominium projects known as
Cypress Pointe Resort at Lake Buena Vista and Cypress Pointe II,
constructed and to be constructed by Borrower on the Real Property.
"Real Property" shall mean that parcel of real property located in
Orange County, Florida and all existing and future improvements located
thereon, more fully described on Xxxxxxxx "X", "X" and "C" of this Seventh
------------ --- ---
Amendment, exclusive of real property previously and hereafter released
from the lien of the Construction Mortgage with the consent of Lender.
"Receivables Advance" shall mean an Advance of the Receivables Loan
advanced by Lender to Borrower from time to time in accordance with the
terms and provisions of this Agreement.
"Receivables Loan" shall mean the revolving line of credit loan
extended by Lender to Borrower in accordance with the terms of this
Agreement in an outstanding principal amount not to exceed at any time the
Maximum Loan Amount.
"Receivables Loan Agreement" shall mean, collectively, the Original
Agreement, the First Amendment, the Second Amendment, the Third
- 6 -
Amendment, the Fourth Amendment, the Fifth Amendment, the Sixth Amendment
and the Seventh Amendment.
"Working Capital Advance" shall mean an Advance of the Working
Capital Loan advanced by Lender to Borrower from time to time in accordance
with the terms and provisions of this Agreement.
"Working Capital Loan" shall mean a revolving line of credit loan
extended by Lender to Borrower in accordance with the terms of this
Agreement in an outstanding principal amount not to exceed at any time the
Maximum Working Capital Loan Amount.
"Working Capital Note" shall mean the Promissory Note, in the
amount of the Working Capital Loan, to be made and delivered by Borrower to
Lender pursuant hereto, in a form acceptable to Lender, as amended, renewed
or restated.
2. Subject to the satisfaction of all of the conditions precedent
set forth in Section 7 hereof, the Original Agreement is hereby amended in the
---------
following respects:
2.1 The provisions of Section 3.1 of the Original Agreement
-----------
shall be amended and restated in their entirety to read as follows:
3.1 Lender hereby agrees that the Receivables Loan will be
disbursed to Borrower, from time to time, in periodic Receivables
Advances, but in no event after the Borrowing Term (Receivables Loan)
has expired, in amounts determined by subtracting from the Borrowing
Base (Receivables Loan) the unpaid principal balance outstanding under
the Receivables Loan at the time of each Receivables Advance;
(i) Receivables Advances shall not be made more
frequently than twice per month, and each Receivables Advance shall
be in an amount of not less that One Hundred Thousand Dollars
($100,000.00). Lender shall charge a fee of Five Hundred Dollars
($500.00) for the second Receivables Advance made during any month
and shall be entitled to deduct such fee from the Receivables
Advance so made. The foregoing fee is to be paid to Lender strictly
in consideration for Lender's agreement to make a second
Receivables Advance during any particular calendar month and shall
not be applied or credited against any other Obligations.
- 7 -
(ii) The Receivables Loan is a revolving line of credit under
the terms of which Borrower, during the Borrowing Term (Receivables
Loan), shall have the right to obtain Receivables Advances, repay
Receivables Advances, and obtain additional Receivables Advances so long
as no Event of Default has occurred and is continuing and so long as all
other conditions precedent to the making of a Receivables Advance have
been satisfied.
(iii) No Receivables Advances will be made after the Borrowing
Term (Receivables Loan) has expired unless Lender, in its sole
discretion, shall agree in writing to make such Receivables Advances.
(iv) Borrower shall use the proceeds of the Receivables Loan
for working capital purposes, to make Distributions to Affiliates to the
extent permitted under this Agreement and under the Construction Loan
Documents and to repay the Construction Loan and the Working Capital
Loan, in full. The proceeds of the Receivables Loan shall be used to pay
and satisfy the then unpaid principal balance and all accrued interest
under the Working Capital Loan before any portion of the Receivables
Loan is used to make Distributions or is paid in satisfaction of any
portion of the Construction Loan. The foregoing notwithstanding, upon
the occurrence of any Event of Default, the proceeds of the Receivables
Loan may be applied by Lender in satisfaction of the Obligations in such
order and manner as Lender shall determine.
(v) At no time during the term hereof shall the unpaid
principal balance of the Receivables Loan, together with the unpaid
principal balance of the Construction Loan and the Working Capital Loan,
exceed a total amount equal to Forty-Five Million Dollars
($45,000,000.00), and Lender shall have no obligation to make any
Receivables Advance if such Advance would cause the foregoing limitation
to be exceeded.
2.2 The provisions of Section 3.2 of the Original Agreement shall be
-----------
amended and restated in their entirety to read as follows:
3.2 Lender agrees that the Working Capital Loan will be disbursed to
Borrower, from time to time, in periodic Working
- 8 -
Capital Advances, but in no event after the Borrowing Term (Working Capital
Loan) has expired, in an amount determined by subtracting from the Borrowing
Base (Working Capital Loan) the unpaid principal balance of the Working
Capital Loan at the time of each Working Capital Advance; provided that at no
time shall the unpaid principal balance of the Working Capital Loan exceed
the Maximum Working Capital Loan Amount.
(i) Working Capital Advances shall be made no more frequently
than twice per month and each Working Capital Advance shall be in an
amount not less than One Hundred Thousand Dollars ($100,000.00). Lender
shall charge a fee of Five Hundred Dollars ($500.00) for the second
Working Capital Advance made during any month and shall be entitled to
deduct such fee from the Working Capital Advance so made. The foregoing
fee is to be paid to Lender strictly in consideration for Lender's
agreement to make a second Working Capital Advance during any particular
calendar month and shall not be applied or credited against any other
Obligations.
(ii) The Working Capital Loan is a revolving line of credit
under the terms of which Borrower, during the Borrowing Term (Working
Capital Loan), shall have the right to obtain Working Capital Advances,
repay Working Capital Advances, and obtain additional Working Capital
Advances so long as no Event of Default has occurred and is continuing
and so long as all other conditions precedent to the making of a Working
Capital Advance have been satisfied. The foregoing notwithstanding,
Borrower shall have no right to obtain a Working Capital Advance against
Eligible Instruments arising from any portion of the Project the
construction of which was commenced prior to the earlier of the
commencement of construction of Building 10 or Building 16. In addition,
Borrower shall have no right to obtain a Working Capital Advance against
Eligible Instruments arising from Building 16 until all Working Capital
Advances against Eligible Instruments arising from Building 10 have been
paid in full including all accrued interest thereon. At such time as
Borrower has received a Working Capital Advance against Eligible
Instruments arising from Building 16, Borrower shall have no further
right to obtain any Working Capital Advances against Eligible
Instruments arising from Building 10.
- 9 -
(iii) No Working Capital Advances will be made after the
Borrowing Term (Working Capital Loan) has expired unless Lender, in its
sole discretion, shall agree to make such Working Capital Advances.
(iv) Borrower shall use the proceeds of the Working Capital
Loan for working capital purposes.
(v) Any cash down payments and principal and interest
payments made by a Purchaser under a particular Instrument that are used
in calculating the Borrowing Base (Working Capital Loan) shall be held
in Escrow by the Escrow Agent and shall not be released to Borrower
unless a principal payment under the Working Capital Loan is made in an
amount equal to the amount of the Working Capital Advance originally
made against such cash down payment and principal and interest payment.
(vi) At no time during the term hereof shall the unpaid
principal balance of the Working Capital Loan, together with the unpaid
principal balance of the Construction Loan and Receivables Loan, exceed
a total amount equal to Forty-Five Million Dollars ($45,000,000.00), and
Lender shall have no obligation to make any Working Capital Advance if
such Advance would cause the foregoing limitation to be exceeded.
2.3 Sections 3.3, 3.5 and 3.6 of the Original Agreement shall be
----------------- ---
deleted.
2.4 The provisions of Section 4.4 of the Original Agreement shall be
-----------
amended and restated in their entirety to read as follows:
4.4 In connection with a Receivables Advance but not a Working
Capital Advance, Borrower shall, at its expense, deliver to Lender, at the
time of delivery of the Assignment, a policy or policies of title
insurance insuring Lender's interest in the Purchaser Mortgage which is
the subject of the Assignment. Such policy or policies shall be in the
amount of the Receivables Advances made against or, in the case of
substitutions, a portion of the Receivables Loan attributable to the
Instruments secured by the insured Purchaser Mortgages and shall be issued
by a title insurer and be in form and substance satisfactory to Lender in
its sole discretion. The title insurance policies must reflect that the
Purchaser Mortgages constitute valid liens against the real
- 10 -
property to which they pertain subject only to the Permitted Encumbrances.
2.5 The provisions of Section 5.3(ix) of the Original Agreement
---------------
shall be amended and restated in their entirety to read as follows:
With respect to a Receivables Advances, the items described in
Exhibit "F" and with respect to a Working Capital Advance, the items
-----------
described in the following paragraphs of Exhibit "F" hereto: (a), (b)
-----------
(unrecorded copies only), (e), (f), (g), (h) and (i);
2.6 The provisions of Section 5.15 of the Original Agreement shall be
------------
amended and restated in their entirety to read as follows:
5.15 The proceeds of the Receivables Loan are to be used, in
part, to pay and satisfy in full the Working Capital Loan and the
Construction Loan. To the extent of the proceeds of the Receivables Loan
arise from a particular Building, such proceeds shall be used in part, to
pay and satisfy in full the Working Capital Loan arising from the same
Building, the Construction Loan as respects such Building and all amounts
then due and owing to Lender under the Construction Loan Documents as
respects such Building. Lender shall have the right to disburse any
Receivables Advance directly to Lender in payment or satisfaction of
Working Capital Advances, and interest thereon, and any amounts then due
to Lender under the Construction Loan Documents. The foregoing
notwithstanding, upon and during the continuance of an Event of Default,
Lender shall have the right to disburse Receivables Advances against the
Obligations in such order and manner as Lender deems appropriate.
2.7 The Original Agreement shall be amended with the addition of a
Section 5.16 reading as follows:
------------
5.16 Working Capital Advances shall be made only against the
Borrowing Base (Working Capital Loan); provided that with respect to
Working Capital Advances only, the eligibility criteria set forth in the
following subparagraphs of Exhibit "B" (as modified pursuant to the Sixth
-----------
Amendment and pursuant to that certain Letter Agreement dated
May 10, 1995) need not be satisfied as a condition to the making of such
Advance: (i) only as to the requirement that the Purchaser Mortgage be
recorded, (j) and (k) with respect to the absence of executory obligation
to the Purchaser and to the extent that such rescission rights described
in subparagraph (k) pertain only to
- 11 -
Borrower's obligations under subparagraph (j) thereof. Furthermore,
with respect to the eligibility criteria set forth in subparagraph (a)
of Exhibit "B", the lien and security interest in the Instrument, the
-----------
security therefore and the rights to payments therefrom shall be
applicable only insofar as Borrower has rights in the Instrument, the
security therefore and the payments therefrom.
2.8 The provisions of Section 7.1 of the Original Agreement shall
-----------
be amended and restated in their entirety to read as follows:
7.1 In connection with the Receivables Loan:
(i) In no event shall the aggregate principal amount
of the Receivables Loan outstanding at any time exceed the
Maximum Loan Amount and in the event for any reason the aggregate
principal amount of the Receivables Loan does exceed the Maximum
Loan Amount, then Borrower upon demand, shall immediately make a
principal payment to Lender in an amount equal to such excess
plus accrued and unpaid interest thereon.
(ii) If for any reason the aggregate principal amount
of the Receivables Loan outstanding as of the last Business Day
of any month shall exceed the then Borrowing Base (Receivables
Loan), Borrower, upon demand, shall immediately make to Lender a
principal payment in an amount equal to such excess plus accrued
and unpaid interest thereon.
(iii) The Receivables Loan shall be evidenced by the
Note and shall be repaid in immediately available funds according
to the terms thereof and such provisions of this Agreement as are
applicable.
2.9 The provisions of Section 7.2 of the Original Agreement shall
-----------
be amended and restated in their entirety to read as follows:
7.2 In connection with the Working Capital Loan:
(i) In no event shall the aggregate principal amount
of the Working Capital Loan outstanding at any time exceed the
Maximum Working Capital Loan Amount and in the event for any
reason the aggregate principal amount of the Working Capital Loan
does exceed the Maximum Working Capital Loan Amount, then
Borrower upon demand, shall
- 12 -
immediately make a principal payment to Lender in an amount equal
to such excess plus accrued and unpaid interest thereon.
(ii) If for any reason the aggregate principal amount
of the Working Capital Loan outstanding as of the last Business
Day of any month shall exceed the then Borrowing Base (Working
Capital Loan), Borrower, upon demand, shall immediately make to
Lender a principal payment in an amount equal to such excess plus
accrued and unpaid interest thereon.
(iii) The Working Capital Loan shall be evidenced by
the Working Capital Note and shall be repaid in immediately
available funds according to the terms thereof and such
provisions of this Agreement as are applicable.
2.10 The provisions of Section 7.3 of the Original Agreement
-----------
shall be amended by amending and restating the introductory paragraph to
read as follows:
7.3 For purposes of determining when a prepayment may occur,
the elapsed time of the term of the Receivables Loan shall be measured
from the date on which the last Receivables Advance is made under the
Original Agreement amended by the Seventh Amendment. Borrower is not
entitled to prepay, in whole or in part, the Receivables Loan until
the Opening Prepayment Date. Thereafter, if (i) Borrower has paid all
sums then due and payable to Lender in connection with the Receivables
Loan, Working Capital Loan and the Construction Loan, and (ii)
Borrower has given Lender at least 30 days prior written notice of the
prepayment and has paid to Lender at the time of prepayment a
prepayment premium equal to a percentage, as set forth below, of the
then principal balance of the Receivables Loan, then Borrower shall
have the option to prepay the Receivables Loan in full, but not in
part, on any date an installment is due on the Note:
2.11 The provisions of Section 7.3 of the Original Agreement
-----------
shall be further amended to provide for the following premium for
prepayment in the event the Receivables Loan is prepaid at any time after
the sixth anniversary of the last Receivables Advance made under the
Original Agreement as amended through this Seventh Amendment:
- 13 -
Period Premium
------ -------
After the Sixth Anniversary Date and 2%
through the Seventh Anniversary Date
of the last Receivables Advance
Thereafter 0%
There shall be no prepayment premium payable in connection with the
prepayment, in whole or in pan, of the Working Capital Loan.
2.12 The provisions of Section 7.3 of the Original Agreement shall be
-----------
further amended by substituting the words "Receivables Advance" for the word
"Advance", in each place, where the word "Advance" appears in that paragraph and
by substituting the words "Receivables Loan" for the word "Loan" in each place
where the word "Loan" appears in that paragraph other than when the word Loan is
preceded by the word "Construction" or the words "Working Capital."
2.13 The provisions of Section 7.6 of the Original Agreement shall be
-----------
amended and restated in their entirety to read as follows:
7.6 Whether or not the proceeds from the Receivables Collateral
shall be sufficient for that purpose, Borrower shall pay when due all
payments required to be made pursuant to the Note, Working Capital Note and
other Documents; and any and all amounts payable by Borrower under the
Note, Working Capital Note and other Documents shall be paid without notice
(except as otherwise expressly provided therein), demand, counterclaim,
set-off, deduction, recoupment or defense, and without abatement,
suspension, deferment, diminution or proration by reason of any
circumstance or occurrence whatsoever, Borrower's Obligation to make such
payments being absolute and unconditional.
2.14 The following language shall be added to the end of Section
-------
8.4(a) of the Original Agreement, as a part thereof:
-----
The foregoing notwithstanding, Lender acknowledges that with
respect to Instruments against which a Working Capital Advance has been
made, Borrower shall not, at the time of such Advance, have completed the
improvements that the Borrower has represented will be available to
Purchasers.
- 14 -
2.15 A Section 8.21 shall be added to the Loan Agreement reading as
------------
follows:
8.21 During the Term, Borrower shall not make any
Distributions to Xxxxxx X. Xxxxxx, Xxxx Xxxxxx, any Guarantor, any
partner of Borrower, any partner of any Guarantor or any Affiliate of
any of the foregoing entities or individuals. The foregoing
notwithstanding, on the condition that:
(i) There does not then exist an Event of Default or an act
or event which with notice, passage of time or both would
constitute an Event of Default (an "Incipient Default"); and
(ii) Prior to the incurring of any obligation to make a
Distribution, Borrower has caused the proposed recipient of such
Distribution (the "Affiliated Party") to have entered into a
Subordination Agreement in form and substance satisfactory to
Lender pursuant to which the Affiliated Party agrees (A) that it
shall not exercise any rights against Borrower or against any of
the collateral securing the Loan or the Construction Loan unless
and until the date that all of the obligations of Borrower under
and with respect to the Loan and the Construction Loan have been
fully paid, performed and discharged; (B) that any entitlement to a
Distribution is and shall be fully subordinated as to right and
time of payment to the payment in full of the Loan and the
Construction Loan and (C) that upon and during the continuance of
an Event of Default or an Incipient Default, no Distributions shall
be permitted, made, demanded or accepted;
the following Distributions shall be permitted:
(x) Such Distribution is made in an amount equal to or less than
100% of Borrower's Cash Flow or 100% of Borrower's Net Income, whichever is
less, with respect to the period in which such Distribution is to be made.
2.16 The provisions of Section 8.22(a) of the Original Agreement shall
---------------
be amended and restated in its entirety to read as follows:
(a) As of the end of each fiscal quarter of Borrower, Borrower
shall maintain a net worth, calculated in accordance with
- 15 -
generally accepted accounting principles, consistently
applied ("GAAP"), of at least $8,500,000.
2.17 The provisions of Section 8.22 of the Original Agreement
------------
shall be further modified by deleting "(e)" from the final subsection of
that section and inserting the letter "(f)" and by adding a new subsection
(e) reading as follows:
(e) Borrower shall not permit Delinquencies as of the end
of any three (3) consecutive calendar months during the Term to exceed
three percent (3%) of the aggregate then unpaid principal balance of
all Eligible Instruments against which an Advance has been made.
2.18 The provisions of Section 8.23 of the Original Agreement
------------
shall be amended and restated in its entirety to read as follows:
8.23 Borrower shall not, without Lender's prior written
consent: (i) construct additional condominium or time-share units
within or adjacent to the Project (other than the time-share units
comprising the Project) until at least 50% of the total Time-Share
Interests in Buildings 8, 10 and 16, in the aggregate, have been sold,
in bona fide transactions, to parties not Affiliated with Borrower,
(ii) sell time-share intervals from such additional condominium or
time-share units until at least 70% of the total Time-Share Interests
contained within Buildings 8, 10 and 16, in the aggregate, have been
sold, in bona fide transactions, to parties not Affiliated with
Borrower.
2.19 Section 11.5 of the Original Agreement shall be amended to
------------
provide that all notices sent to Lender shall be sent to Lender at the
following address:
FINOVA Capital Corporation
0000 Xxxx Xxxxxx Xxxxxx Xxxx, Xxxxx 000
Xxxxxxxxxx, Xxxxxxx 00000
Attn: Vice President - Group Counsel
With a copy to:
FINOVA Capital Corporation
0000 Xxxx Xxxxxx Xxxxxx Xxxx, Xxxxx 000
Xxxxxxxxxx, Xxxxxxx 00000
Attn: Vice President - Operations Management
- 16 -
2.20 The provisions of Section 9.1(a) shall be amended and
--------------
restated in their entirety to read as follows:
(a) Lender fails to receive from Borrower when due and
payable any amount which Borrower is obligated to pay on the Note or
the Working Capital Note or any other payment due under the Documents;
and such failure shall continue for seven (7) days, except for the
payment of the final installment due under the Note at the Maturity
Date, for which no grace period is allowed;
2.21 The provisions of Section 9.2(b) of the Original Agreement
--------------
shall be amended in their entirety to read as follows:
(b) declare each or either of the Note and the Working
Capital Note, together with prepayment premiums and all other sums
owing by Borrower to Lender in connection with the Documents,
immediately due and payable without notice, presentment, demand or
protest, which are hereby waived by Borrower;
3. DOCUMENT REFERENCE. All references to the "Loan Agreement" in
------------------
the Documents and to "this Agreement", "herein", "hereof", "hereto", and
"hereunder" in the Original Agreement are hereby amended to refer to the
Original Agreement as amended through this Seventh Amendment.
4. FEES AND EXPENSES. In addition to the fees and expenses that
-----------------
have been paid or are payable by Borrower pursuant to the Original Agreement,
Borrower shall pay to Lender (i) a loan fee (the "Working Capital Loan Fee") in
the amount of $15,000.00, which fee was earned by Lender in consideration of
Lender holding itself ready, willing and able to amend the Original Agreement
upon the terms and conditions set forth herein and (ii) a loan fee (the
"Receivables Loan Fee") in the amount of $150,000.00, which fee was earned by
Lender in further consideration of Lender holding itself ready, willing and able
to amend the Original Agreement upon the terms and conditions set forth herein.
The payment of the Working Capital Loan Fee and the Receivables Loan Fee is in
addition to Borrower's obligation to pay a loan fee to Lender in consideration
for the Lender's commitment to modify and amend the Construction Loan Agreement
and in addition to all other fees and expenses required to be paid by Borrower
pursuant to the Sixth Amendment to Construction Loan Agreement of even date
herewith. One-half of the Working Capital Loan Fee, in the amount of $7,500,
shall be due concurrently with the making of the first Working Capital Advance
after the date of this Seventh Amendment. The remaining balance of the Working
Capital Loan Fee, in the amount of $7,500, shall be due and payable concurrently
with the making of the second Working Capital Advance after the date of
- 17 -
this Seventh Amendment. The foregoing notwithstanding, unless sooner paid, the
entire Working Capital Loan Fee shall be due and payable in full on December
31, 1995. The first Fifty Thousand Dollars of the Receivables Loan Fee shall be
due and payable concurrently with the making of the Receivables Advance which
causes the unpaid principal balance of the Receivables Loan to exceed Twenty-
Five Million Dollars ($25,000,000) and may be withheld from Advance so made. An
additional Fifty Thousand Dollars ($50,000.00) of the Receivables Loan Fee
shall be due and payable concurrently with the making of the Receivables
Advance which causes the unpaid principal balance of the Receivables Loan to
exceed Thirty Million Dollars ($30,000,000.00) and may be withheld from the
Advance so made. The remaining Fifty Thousand Dollars ($50,000.00) of the
Receivables Loan Fee shall be due and payable concurrently with the making of
the Receivables Advance which causes the unpaid principal balance of the
Receivables Loan to exceed Thirty-Five Million Dollars ($35,000,000.00) and may
be withheld from the Advance so made. The foregoing notwithstanding, unless
sooner paid, the entire Receivables Loan Fee shall be due and payable on full
on March 31, 1997. Furthermore, Borrower shall pay, on demand, all costs and
expenses arising from the preparation of this Seventh Amendment and the closing
of the amendment to the Construction Loan Documents, or otherwise incurred by
Lender in connection with this Seventh Amendment, including, but not limited
to, title insurance premiums, other title company charges, recording fees, all
charges for consumer credit reports, and U.C.C., tax lien, judgment and
litigation searches, Lender's attorneys' fees and costs, appraisal fees, if
any, survey costs, if any, inspection costs and fees, both during construction
or otherwise, escrow disbursement expenses, any revenue and/or documentary
stamps, intangible or recording taxes, out-of-pocket travel expenses incurred
by Lender or its agents and employees, brokerage commissions, all fees and
expenses of the Servicing Agent and Collection Agent in connection with this
Seventh Amendment, and any other costs, expenses or charges that may be imposed
on or incurred by Lender as a result of this Amendment. Borrower shall
indemnify and hold Lender harmless from any and all liability for payment of
any brokerage fees. Lender shall have the right to withhold from any Advance
made hereunder, any costs, fees, expenses or reimbursements due and owing to
Lender.
5. CONFIRMATION OF REPRESENTATIONS, WARRANTIES AND AGREEMENTS.
----------------------------------------------------------
Borrower hereby reaffirms, as if made as of the date hereof, all of Borrower's
representations and warranties contained in the Receivables Loan Agreement.
Borrower furthermore reaffirms the validity, enforceability and legality of the
Documents, and all provisions of the Documents, as modified, are hereby
confirmed and ratified; provided, however, that with respect to enforceability
-----------------
and legality, Borrower make such reaffirmation only to the best of its
knowledge. Without limiting the generality of the foregoing, Borrower
represents and warrants that there has occurred no material adverse change in
the Real Property, Receivables Collateral or Residual Collateral or in the
business or financial condition of Borrower or
- 18 -
Guarantor since the date of the last financial statements submitted to Lender
and that neither Borrower nor Guarantor has failed to disclose to Lender any
information material to the Loan. All provisions of the Documents, as modified,
are hereby confirmed and ratified. Without limiting the generality of the
foregoing, Borrower hereby reaffirms the validity and enforceability of the
Security Interest granted to Lender in the Receivables Collateral and the
Residual Collateral as security for Borrower's payment and Performance of all
Obligations, other than those Obligations arising out of the Environmental
Certificate with Representations, Covenants and Warranties delivered in
connection with the Construction Loan Agreement. In the event of a conflict or
inconsistency between the provisions of the Original Agreement, the First
Amendment, the Second Amendment, the Third Amendment, the Fourth Amendment, the
Fifth Amendment or the Sixth Amendment, on the one hand, and the provisions of
this Seventh Amendment, on the other hand, the provisions of this Seventh
Amendment shall prevail. All terms, conditions and provisions of the Original
Agreement, First Amendment, Second Amendment, Third Amendment, Fourth Amendment,
Fifth Amendment and Sixth Amendment are continued in full force and effect and
shall remain unaffected and unchanged except as specifically amended or modified
hereby. Borrower acknowledges that as of the date hereof, it has (i) no defense,
counterclaim, offset, cross-complaint, claim or demand of any nature whatsoever
which can be asserted as a basis to seek affirmative relief or damages from
Lender or as a basis to reduce or eliminate all or any part of its liability to
repay the Loan and (ii) no other claim against Lender with respect to any aspect
of the transaction in respect to which the Loan was made.
6. GUARANTORS' RATIFICATION. As a condition precedent to the
------------------------
effectiveness of this Seventh Amendment, Borrower shall cause the Guarantors to
each execute a Ratification and Confirmation of Guarantee and Subordination
Agreement in forms acceptable to Lender, thereby acknowledging the making of the
agreements contained herein.
7. CONDITIONS PRECEDENT. The amendments and modifications to
--------------------
the Receivables Loan Agreement contained herein and Lender's obligations in this
regard are subject to the following express conditions precedent:
7.1 The following shall be delivered to Lender all in a form,
manner and substance satisfactory to Lender:
(a) An original of this Sixth Amendment fully executed by
the Borrower;
(b) An original Ratification and Confirmation of Corporate
Guarantee and Subordination Agreement in a form acceptable to Lender,
fully executed by Argosy Group, Inc.;
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(c) An original Ratification and Confirmation of Partnership
Guarantee and Subordination Agreement in a form acceptable to Lender,
fully executed by Argosy Canyon Investments, L.P.;
(d) Current updates of the opinion letter received by Lender
in connection with the Receivables Loan Agreement from Xxxxxxxxx,
Xxxxxxx & Flint;
(e) Such resolutions and authorizations and such other
documents as Lender may require relating to the existence and good
standing of the Borrower and Guarantors, and the authority of any
person executing this Sixth Amendment or any other documents on behalf
of the Borrower or Guarantors;
(f) Updated credit references and Dun & Bradstreet report
for Borrower and updated UCC, tax lien, litigation and judgment
searches for the following parties: (i) Borrower, (ii) Argosy Group,
Inc., and (iii) Argosy Canyon Investments, L.P.;
(g) Evidence that Borrower has good and marketable title to
the collateral pledged to Lender, that Lender's liens and security
interest in such collateral have been duly perfected as first and
prior liens and security interests, and that there are no other
financing statements or liens filed against Borrower or on the
property of Borrower except those that are approved by Lender;
(h) Evidence of the payment by Borrower of any costs, fees
and expenses then payable in connection with the Loan, including,
without limitation, those fees, costs and expenses described in
Section 4 hereof; and
---------
(i) An original of the Fifth Allonge to Receivables
Promissory Note in a form acceptable to Lender, fully executed by
Borrower;
(j) An original of the Working Capital Promissory Note in
a form acceptable to Lender, fully executed by Borrower;
(k) An original Sixth Amendment to Mortgage, Assignment of
Rents and Proceeds and Security Agreement in a form
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acceptable to Lender, fully executed by Borrower (the "Sixth Mortgage
Modification");
(l) An Acknowledgment and Agreement from the Escrow Agent
in a form acceptable to Lender pursuant to which the Escrow Agent
agrees to abide by the provisions of Section 3.2(v) of the Original
--------------
Agreement, added to the Original Agreement pursuant to this Seventh
Amendment.
(m) All documents required to be executed and delivered to
Lender in connection with the amendment and modification of the
Construction Loan Agreement;
(n) A commitment from First American Title Company, the
issuer of Lender's ALTA extended coverage title insurance policy
insuring the lien of the Construction Mortgage (the "Title Policy"),
to issue an endorsement, in form satisfactory to Lender, to the Title
Policy, insuring that the Construction Mortgage, as modified pursuant
to the Sixth Mortgage Modification, continues to be a first lien upon
the real property described therein, subject only to those exceptions
contained in such title policy and to such additional exceptions as
Lender may specifically approve in writing;
(o) An ALTA certified survey of the Real Property, other
than that portion which prior to the date hereof is already subject to
the Construction Mortgage, in a form acceptable to Lender;
(p) A Subordination Agreement, in a form acceptable to
Lender, from each of the Affiliated Parties, as defined in Section
-------
8.21 of the Original Agreement, added to the Original Agreement
----
pursuant to this Seventh Amendment;
(q) Such amendments to Lender's financing statements as
Lender shall require in order to perfect the security interest granted
to Lender pursuant to the Collateral Assignment; and
(r) An original of the Collateral Assignment, fully
executed by Borrower.
7.2 No Event of Default shall exist and no event or condition
shall exist which after notice or lapse of time, or both, would constitute
an Event of Default.
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7.3 There shall have occurred no material adverse change in the
Real Property, the Receivables Collateral or Residual Collateral or in the
business or financial condition of Borrower and Guarantor since the date of
the last financial statement submitted to Lender.
7.4 Neither Borrower nor Guarantor shall have failed to disclose
to Lender any material information and no material information supplied by
Borrower or Guarantor shall be found to be misleading, misrepresented or
materially incorrect.
7.5 All representations and warranties by Borrower shall remain
true and correct, in all material respects, and all agreements the Borrower
is to have performed or complied with at such time shall have been
performed or complied with.
8. COUNTERPARTS. This Seventh Amendment may be executed in any
------------
number of separate counterparts, each of which when taken together shall
constitute one and the same instrument notwithstanding the fact that all parties
have not signed the same counterpart.
IN WITNESS WHEREOF, these presents are executed as of the date first
indicated above.
"BORROWER"
CYPRESS POINT RESORTS, L.P.,
a Delaware limited partnership
By: ARGOSY GROUP, INC., a Georgia
corporation, General Partner
By /s/ [SIGNATURE ILLEGIBLE]
-------------------------------
Its VICE PRESIDENT
------------------------------
"LENDER"
FINOVA CAPITAL CORPORATION, a
Delaware corporation
By /s/ [SIGNATURE ILLEGIBLE]
-----------------------------------
Its VICE PRESIDENT
-----------------------------------
[CORPORATE SEAL]
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