EXHIBIT 10.161
LOAN AGREEMENT
Wachovia Bank, National Association
000 Xxxxx Xxxxx Xxxxxx - XX0000
Xxxxxxxxxxxx, Xxxxxxx 00000
(Hereinafter referred to as the "Bank")
Bluegreen Corporation, a Massachusetts corporation
0000 Xxxxxxxxxx Xxx Xxxxx
Xxxxx 000
Xxxx Xxxxx, Xxxxxxx 00000
and
Bluegreen Communities of Georgia, LLC,
a Georgia limited liability company
0000 Xxxxxxxxxx Xxx Xxxxx
Xxxx Xxxxx, Xxxxxxx 00000
(Individually and collectively "Borrower")
This Loan Agreement ("Agreement") is entered into November 12, 2003, by and
between Bank and Borrower.
This Agreement applies to the loan (the "Loan") evidenced by that certain
Promissory Note dated of even date herewith, as modified from time to time (the
"Note") and all Loan Documents. The terms "Loan Documents" and "Obligations," as
used in this Agreement, are defined in the Note.
Relying upon the covenants, agreements, representations and warranties contained
in this Agreement, Bank is willing to extend credit to Borrower upon the terms
and subject to the conditions set forth herein, and Bank and Borrower agree as
follows:
REPRESENTATIONS. Borrower represents that from the date of this Agreement and
until final payment in full of the Obligations: Accurate Information. All
information now and hereafter furnished to Bank is and will be true, correct and
complete. Any such information relating to Borrower's financial condition will
accurately reflect Borrower's financial condition as of the date(s) thereof,
(including all contingent liabilities of every type), and Borrower further
represents that its financial condition has not changed materially or adversely
since the date(s) of such documents. Authorization; Non-Contravention. The
execution, delivery and performance by Borrower and any guarantor, as
applicable, of this Agreement and other Loan Documents to which it is a party
are within its power, have been duly authorized as may be required and, if
necessary, by making appropriate filings with any governmental agency or unit
and are the legal, binding, valid and enforceable obligations of Borrower and
any guarantors; and do not (i) contravene, or constitute (with or without the
giving of notice or lapse of time or both) a violation of any provision of
applicable law, a violation of the organizational documents of Borrower or any
guarantor, or a default under any agreement, judgment, injunction, order, decree
or other instrument binding upon or affecting Borrower or any guarantor, (ii)
result in the creation or imposition of any lien (other than the lien(s) created
by the Loan Documents) on any of Borrower's or any guarantor's assets, or (iii)
give cause for the acceleration of any obligations of Borrower or any guarantor
to any other creditor. Asset Ownership. Borrower and each of its Subsidiaries
have good and marketable title to all of the properties and assets reflected on
the balance sheets and financial statements supplied Bank by Borrower, and with
respect to the Borrower, all such properties, assets and stock are free and
clear of mortgages, security deeds, pledges, liens, charges, and all other
encumbrances, except as otherwise disclosed to Bank by Borrower
in writing and approved by Bank ("Permitted Liens"). In addition, all of the
stock of Borrower's Subsidiaries is free and clear of liens, pledges and
encumbrances. To Borrower's knowledge, no default has occurred under any
Permitted Liens and no claims or interests adverse to Borrower's present rights
in its properties and assets have arisen. Discharge of Liens and Taxes. Borrower
has duly filed, paid and/or discharged all taxes or other claims that may become
a lien on any of its property or assets, except to the extent that such items
are being appropriately contested in good faith and an adequate reserve for the
payment thereof is being maintained. Sufficiency of Capital. Borrower is not,
and after consummation of this Agreement and after giving effect to all
indebtedness incurred and liens created by Borrower in connection with the Note
and any other Loan Documents, will not be, insolvent within the meaning of 11
U.S.C. ss. 101(32). Compliance with Laws. Borrower is in compliance in all
respects with all federal, state and local laws, rules and regulations
applicable to its properties, operations, business, and finances, including,
without limitation, any federal or state laws relating to liquor (including 18
U.S.C. ss. 3617, et seq.) or narcotics (including 21 U.S.C. ss. 801, et seq.)
and/or any commercial crimes; all applicable federal, state and local laws and
regulations intended to protect the environment; and the Employee Retirement
Income Security Act of 1974, as amended ("ERISA"), if applicable. Organization
and Authority. Each Borrower is duly created, validly existing and in good
standing under the laws of the state of its organization, and has all powers,
governmental licenses, authorizations, consents and approvals required to
operate its business as now conducted. Each Borrower is duly qualified, licensed
and in good standing in each jurisdiction where qualification or licensing is
required by the nature of its business or the character and location of its
property, business or customers, and in which the failure to so qualify or be
licensed, as the case may be, in the aggregate, could have a material adverse
effect on the business, financial position, results of operations, properties or
prospects of Borrower or any such guarantor. No Litigation. There are no pending
or threatened suits, claims or demands against Borrower or any guarantor that
have not been disclosed to Bank by Borrower in writing, and approved by Bank.
AFFIRMATIVE COVENANTS. Borrower agrees that from the date hereof and until final
payment in full of the Obligations, unless Bank shall otherwise consent in
writing, Borrower will: Access to Books and Records. Allow Bank, or its agents,
during normal business hours, access to the books, records and such other
documents of Borrower as Bank shall reasonably require, and allow Bank, at
Borrower's expense, to inspect, audit and examine the same and to make extracts
therefrom and to make copies thereof. Business Continuity. Conduct its business
in substantially the same manner and locations as such business is now and has
previously been conducted. Certificate of Full Compliance From Accountant.
Deliver to Bank, with the financial statements required herein, a certification
by Bluegreen's independent certified public accountant that Borrower is in full
compliance with the Loan Documents. Compliance with Other Agreements. Comply
with all terms and conditions contained in this Agreement, and any other Loan
Documents, and swap agreements, if applicable, as defined in the 11 U.S.C. ss.
101. Estoppel Certificate. Furnish, within 15 days after request by Bank, a
written statement duly acknowledged of the amount due under the Loan and, to
Borrower's knowledge, whether offsets or defenses exist against the Obligations.
Insurance. Maintain adequate insurance coverage with respect to its properties
and business against loss or damage of the kinds and in the amounts customarily
insured against by companies of established reputation engaged in the same or
similar businesses including, without limitation, commercial general liability
insurance, workers compensation insurance, and business interruption insurance;
all acquired in such amounts and from such companies as Bank may reasonably
require. Maintain Properties. Maintain, preserve and keep its property secured
by the Loan Documents in good repair, working order and condition, making all
needed replacements, additions and improvements thereto, to the extent allowed
by this Agreement. Notice of Default and Other Notices. (a) Notice of Default.
Furnish to Bank immediately upon becoming aware of the existence of any
condition or event which constitutes a Default (as defined in the Loan
Documents) or any event which, upon the giving of notice or lapse of time or
both, may become a Default, written notice specifying the nature and period of
existence thereof and the action which Borrower is taking or proposes to take
with respect thereto. (b) Other Notices. Promptly notify Bank in writing of (i)
any material adverse change in its financial condition or its business; (ii) any
default under any material agreement, contract or other instrument to which it
is a party or by which any of its properties are bound, or any acceleration of
the maturity of any indebtedness owing by Borrower; (iii) any material adverse
claim against or affecting Borrower or any part of its properties; (iv) the
commencement of, and any material determination in, any
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litigation with any third party or any proceeding before any governmental agency
or unit affecting Borrower; and (v) at least 30 days prior thereto, any change
in Borrower's name or address as shown above, and/or any change in Borrower's
structure. Other Financial Information. Deliver promptly such other information
regarding the operation, business affairs, and financial condition of Borrower
which Bank may reasonably request. Payment of Debts. Pay and discharge when due,
and before subject to penalty or further charge, and otherwise satisfy before
maturity or delinquency, all obligations, debts, taxes, and liabilities of
whatever nature or amount, except those which Borrower in good faith disputes.
Reports and Proxies. Deliver to Bank, promptly, a copy of all financial
statements, reports, notices, and proxy statements, sent by Borrower to
stockholders, and all regular or periodic reports required to be filed by
Borrower with any governmental agency or authority.
Partial Releases of Property. Provided Borrower is not then in Default hereunder
or under any other Loan Document, Bank will provide partial releases of
residential lots (individually a "Lot" and collectively the "Lots") in respect
of its lien under that certain Deed to Secure Debt, Assignment of Rents and
Security Agreement (the "Deed to Secure Debt") from Borrower to Bank dated of
even date herewith and the other Loan Documents, as required for the purpose of
transferring clear title to purchasers of Lots, provided that the Borrower pays
to the Bank a release price equal to 55% of the gross sales price for such Lot,
but in no event less than $25,000.00 per Lot, together with a satisfaction of
all other non-monetary conditions imposed by Bank in connection therewith.
Borrower's request for a partial release shall be accompanied a by copy of the
applicable fully executed sales contract for said residential lot and the fully
executed settlement statement, a legal description and a survey of the Lot in
question, and any other documents requested by Bank.
Payments made for releases shall be applied by Bank against the next due
outstanding principal of the Loan. The acceptance by Bank of any payments of
release prices during the pendency of a Default hereunder shall not constitute a
waiver by Bank of any of its rights or remedies with respect to any such
Default. Borrower agrees to reimburse Bank for all out-of-pocket fees and costs,
including, without limitation, reasonable legal fees, in connection with the
granting of such partial releases and shall comply with all other non-monetary
conditions imposed by Bank with respect to that portion of the property to be
released.
Notwithstanding the foregoing, Bank will provide partial releases in connection
with dedication of roads, easements and joinders, upon the written request of
Borrower, which consent shall not be unreasonably withheld. In addition,
provided Borrower obtains all necessary environmental permits for that portion
of real property more particularly designated on EXHIBIT "B" attached hereto as
the "Removed Property" on or before December __, 2004, Bank will, upon receipt
and approval of all conditions for conveyance of the property described on
EXHIBIT "C" as provided in that certain Amended and Restated Agreement of
Purchase and Sale dated October __, 2003 (the "Purchase Agreement"), upon
spreading the lien of that certain Deed to Secure Debt, Assignment of Rents and
Security Agreement dated of even date herewith (the "Deed to Secure Debt") to
the Removed Property, and upon the endorsement to the Bank's title policy to
insure such Removed Property, release its lien with respect to that portion of
real property more particularly described on EXHIBIT "C" attached hereto, and
spread its lien to include the Removed Property.
NEGATIVE COVENANTS. Borrower agrees that from the date of this Agreement and
until final payment in full of the Obligations, unless Bank shall otherwise
consent in writing, Borrower will not: Default on Other Contracts or
Obligations. Default on any material contract with or obligation when due to a
third party or default in the performance of any obligation to a third party
incurred for money borrowed. Government Intervention. Permit the assertion or
making of any seizure, vesting or intervention by or under authority of any
governmental entity, as a result of which the management of Borrower or any
guarantor is displaced of its authority in the conduct of its respective
business or such business is curtailed or materially impaired. Pledge of Assets.
Make or permit to exist, against Bluegreen Communities of Georgia, LLC, a
Georiga limited liability company ("Bluegreen Communities") any mortgages,
security deeds, pledges, liens, charges, and all other encumbrances, on the
property more particularly described on EXHIBIT A attached hereto or any
substitute property or make or permit to exist any pledge on any of the stock of
Borrower or its Subsidiaries, except as otherwise disclosed to Bank by
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Borrower in writing and approved by Bank. Judgment Entered. Permit the entry of
any monetary judgment or the assessment against, the filing of any tax lien
against, or the issuance of any writ of garnishment or attachment against the
land or other property secured by the Loan Documents.
ANNUAL FINANCIAL STATEMENTS. Bluegreen Corporation, a Massachusetts corporation
("Bluegreen") shall deliver to Bank, within 90 days after the close of each
fiscal year, audited financial statements reflecting its operations during such
fiscal year, including, without limitation, a balance sheet, profit and loss
statement and statement of cash flows, with supporting schedules; all on a
consolidated and consolidating basis with respect to Bluegreen and its
subsidiaries, affiliates and parent or holding company, as applicable, and in
reasonable detail, prepared in conformity with generally accepted accounting
principles, applied on a basis consistent with that of the preceding year. All
such statements shall be examined by an independent certified public accountant
acceptable to Bank. The opinion of such independent certified public accountant
shall not be acceptable to Bank if qualified due to any limitations in scope
imposed by Bluegreen or any other person or entity. Any other qualification of
the opinion by the accountant shall render the acceptability of the financial
statements subject to Bank's approval.
Periodic Financial Statements. Bluegreen shall deliver to Bank, within 45 days
after the end of each fiscal quarter, audited quarterly financial statements
including, without limitation, a balance sheet, profit and loss statement and
statement of cash flows, with supporting schedules; all on a consolidated and
consolidating basis with respect to Bluegreen and its subsidiaries, affiliates
and parent or holding company, as applicable, all in reasonable detail and
prepared in conformity with generally accepted accounting principles, applied on
a basis consistent with that of the preceding year. Such statements shall be
certified as to their correctness by a principal financial officer of Bluegreen
and in each case, if audited statements are required, subject to audit and
year-end adjustments.
TAX RETURNS. Bluegreen shall deliver to Bank, within 30 days of filing, complete
copies of federal and state tax returns, as applicable, together with all
schedules thereto, each of which shall be signed and certified by an officer of
Bluegreen to be true and complete copies of such returns. In the event an
extension is filed, Bluegreen shall deliver a copy of the extension within 30
days of filing.
INVENTORY AND WORK IN PROGRESS REPORTS. Borrower shall deliver to Bank, within
10 days of each month end, an Inventory and Work in Progress Report which shall
include, without limitation, capital expenditures to date, Lots in progress to
date, Lots completed to date, Lots under sales agreement, and Lots sold to date.
FINANCIAL COVENANTS. Borrower agrees to the following provisions from the date
hereof until final payment in full of the Obligations, unless Bank shall
otherwise consent in writing, using the financial information for Borrower, its
subsidiaries, affiliates and its holding or parent company, as applicable:
Adjusted Tangible Net Worth. Bluegreen shall, at all times, on a consolidated
basis, maintain an Adjusted Tangible Net Worth of not less than $165,000,000.00.
"Adjusted Tangible Net Worth" shall mean total assets minus Adjusted Total
Liabilities. For purposes of this computation, the aggregate amount of any
intangible assets of Bluegreen including, without limitation, goodwill,
franchises, licenses, patents, trademarks, trade names, copyrights, service
marks, and brand names, shall be subtracted from total assets. "Adjusted Total
Liabilities" shall mean all liabilities of Bluegreen, including capitalized
leases and all reserves for deferred taxes, and other deferred sums appearing on
the liabilities side of a balance sheet and all obligations as lessee under
off-balance sheet synthetic leases of Bluegreen, excluding debt fully
subordinated to Bank on terms and conditions acceptable to Bank, all in
accordance with generally accepted accounting principles applied on a consistent
basis. Adjusted Total Liabilities to Adjusted Tangible Net Worth Ratio.
Bluegreen shall, at all times, on a consolidated basis, maintain a ratio of
Adjusted Total Liabilities to Adjusted Tangible Net Worth of not more than 2.50
to 1.00. Funds Flow Coverage Ratio. Bluegreen shall, at all times, on a
consolidated basis, maintain a Funds Flow Coverage Ratio of not less than 2.00
to 1.00, to be calculated quarterly, on a rolling four quarters basis. "Funds
Flow Coverage Ratio" shall mean the sum of earnings before interest, taxes,
depreciation and amortization plus non-cash expenses minus dividends,
withdrawals and non-cash income divided by Interest Expense for the same period.
"Interest Expense" shall mean the total interest expense of Bluegreen on a
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consolidated basis including capitalized interest, amortization of debt
discount, non-cash interest expense less interest income earned and less
amortization of capitalized interest.
CONDITIONS PRECEDENT. The obligations of Bank to make the loan and any advances
pursuant to this Agreement are subject to the following conditions precedent:
Additional Documents. Receipt by Bank of such additional supporting documents as
Bank or its counsel may reasonably request. Opinion of Counsel. On or prior to
the date of any extension of credit hereunder, Bank shall have received a
written opinion of the counsel of Borrower acceptable to Bank that includes
confirmation of the following: (a) The accuracy of the representations set forth
in this Agreement in the Representations Subparagraphs entitled "Authorization;
Non-Contravention"; "Compliance with Laws", and "Organization and Authority".
(b) This Agreement and other Loan Documents have been duly executed and
delivered by Borrower and constitute the legal, valid and binding obligations of
Borrower, enforceable in accordance with their terms. (c) No registration with,
consent of, approval of, or other action by, any federal, state or other
governmental authority or regulatory body is required by law in connection with
the execution and delivery of this Agreement and the other Loan Documents, or
the extension of credit under this Agreement or the other Loan Documents, or, if
so required, such registration has been made, and such consent or approval given
or such other appropriate action taken. (d) The loan is not usurious. (e) The
Loan Documents create the priority of lien on or security interest in the
Collateral (as defined in the Loan Documents) that is contemplated by the Loan
Documents.
DEFAULTS AND REMEDIES. If the following event occurs, a default ("Default")
under this Agreement shall exist: failure to timely pay or perform any of the
terms, covenants or obligations under this Agreement or a default under any
other Loan Document, in any case not cured within the applicable cure period set
forth in the Note, if any.
Upon the occurrence of a Default, Bank shall have the right to declare
immediately due and payable the outstanding principal balance of the Note, all
accrued and unpaid interest thereon and all other sums due in connection
therewith, and Bank may exercise any right, power or remedy permitted by law or
as set forth in any of the Loan Documents.
FEE. Borrower shall pay Bank a fee of $39,550.00 at the closing of this
Agreement.
IN WITNESS WHEREOF, Borrower and Bank, on the day and year first written above,
have caused this Agreement to be executed under seal.
Bluegreen Corporation, a Massachusetts corporation
By: /S/ XXXXXX X. XXXXXXX (SEAL)
------------------------------------------
Xxxxxx X. Xxxxxxx, Senior Vice President
Bluegreen Communities of Georgia, LLC, a Georgia
limited liability company
By: /S/ XXXXXX X. XXXXXXX (SEAL)
------------------------------------------
Xxxxxx X. Xxxxxxx, Manager
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Wachovia Bank, National Association
By: /S/ XXXXX XXXXXXX (SEAL)
------------------------------------------
Xxxxx Xxxxxxx, Vice President
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