Exhibit 10.12
SECOND AMENDMENT
to
REVOLVING LOAN AGREEMENT
This Second Amendment to Revolving Loan Agreement (the "Second Amendment")
is executed and delivered as of the 1st day of July, 1997, by and between ORIOLE
HOMES CORP., a Florida corporation (the "Borrower"), Suite 200, 0000 Xxxxx
Xxxxxxxx Xxxxxx, Xxxxxx Xxxxx, Xxxxxxx 00000-0000, and OHIO SAVINGS BANK, a
federal savings bank, f/k/a Ohio Savings Bank, F.S.B. and f/k/a Ohio Savings
Bank, an Ohio corporation (the "Bank"), 200 Ohio Savings Plaza, 0000 Xxxx Xxxxx
Xxxxxx, Xxxxxxxxx, Xxxx 00000;
W I T N E S S E T H:
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WHEREAS, in consideration for a revolving line of credit in the maximum
amount of Twenty Million Dollars ($20,000,000.00) (the "Consolidated Loan") made
by Bank to Borrower, Borrower has executed and delivered to Bank its
Consolidated Revolving Mortgage Note dated January 12, 1996, in the maximum
principal amount of the Consolidated Loan as aforesaid (the "Second Consolidated
Note");
WHEREAS, the Consolidated Loan is evidenced by, among other things, a
Revolving Loan Agreement dated the 13th day of July, 1993, as modified by a
First Amendment to Revolving Loan Agreement dated the 23rd day of August, 1995,
both executed by Borrower and Bank (together, the "Agreement");
WHEREAS, the Second Consolidated Note is secured by, among other things, a
Mortgage and Security Agreement dated as of July 13, 1993, and recorded July 16,
1993, in Official Records Book 7800, Page 1590, of the Public Records of Palm
Beach County, Florida, as modified, extended and spread by (i) a Mortgage,
Assignment and Financing Statement Spreader Agreement dated May 31, 1995, and
recorded June 6, 1995, in Official Records Book 8776, Page 262, of said Public
Records, (ii) a Future Advance, Mortgage, Assignment and Financing Statement
Extension, Modification and Spreader Agreement dated August 23, 1995, and
recorded August 30, 1995, in Official Records Book 8897, Page 53, of said Public
Records, (iii) a Future Advance, Mortgage, Assignment and Financing Statement
Modification and Spreader Agreement dated January 12, 1996 and
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recorded January 17, 1996, in Official Records Book 9085, Page 547, of said
Public Records, and (iv) a Mortgage and Loan Modification and Extension
Agreement of even date herewith, all executed and delivered by the Borrower to
the Bank (the Mortgage and Security Agreement, as modified, extended and spread,
is herein referred to as the "Mortgage"); and
WHEREAS, Borrower and Bank have agreed that Bank shall extend the
Termination Date (capitalized terms not defined herein shall have the meanings
ascribed to them in the Agreement) of the Consolidated Loan to June 30, 1999,
and reduce the Maximum Loan Amount to an amount not to exceed Ten Million
Dollars ($10,000,000.00) on the terms and conditions hereinafter set forth.
NOW THEREFORE, in consideration of the sum of Ten Dollars ($10.00) and
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, and intending to be legally bound, the Borrower and Bank
hereby covenant and agree as follows:
1. Recitals. The aforementioned recitals are true and correct and are
hereby incorporated by this reference.
2. Consolidated Loan. As of the date hereof, the unpaid principal balance
of the Consolidated Loan is One Hundred Thousand Dollars ($100,000.00), and
interest has been paid on the Second Consolidated Note through May 31, 1997.
Borrower acknowledges that the indebtedness evidenced by the Second Consolidated
Note is free of any and all defenses, setoffs and counterclaims, and that
Borrower has no claims against Bank in connection with or related to the
Consolidated Loan or any Loan Document as of the date hereof.
3. Modification of Agreement. The Agreement is hereby amended, modified
and extended as follows:
(a) Definitions.
(i) The definition of the term "Bank" defined in Section 1(a) is
hereby replaced and superseded by the following:
"Bank" means OHIO SAVINGS BANK, a federal savings bank, f/k/a Ohio Savings Bank,
F.S.B. and f/k/a Ohio Savings Bank, a corporation incorporated under the laws of
the State of Ohio.
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(ii) The definition of the term "Contract Year" defined in Section
1(a) is hereby replaced and superseded by the following:
"Contract Year" means each twelve (12) month period commencing on July 1 of each
calendar year and ending on June 30 of the following calendar year.
(iii) The definition of the term "Maximum Loan Amount" defined in
Section 1(a) is hereby replaced and superseded by the following:
"Maximum Loan Amount" means Ten Million and no/100 Dollars
($10,000,000.00) (U.S.).
(iv) The definition of the term "Revolving Note" defined in
Section 1(a) is hereby replaced and superseded by the following:
"Revolving Note" means the Renewal Amended and Restated Consolidated Revolving
Mortgage Note dated as of July 1, 1997, executed and delivered to Bank by
Borrower, in the maximum principal amount of Ten Million and no/100 Dollars
($10,000,000.00), including any partial or total extension, restatement,
renewal, amendment, modification or substitution thereof or therefor.
(v) The definition of the term "Termination Date" defined in
Section 1(a) is hereby replaced and superseded by the following:
"Termination Date" means June 30, 1999.
(b) Section 2(a) (1). Clause (1) of Section 2 (a) is hereby superseded,
restated and replaced by the following:
(1) Line Advances. Subject to the terms and conditions hereof, and in
reliance on the representations and warranties herein contained, Bank shall make
Line Advances from time to time during the period commencing on the date hereof
and ending on the Termination Date to or for the account of Borrower up to but
not exceeding an aggregate unpaid principal amount outstanding at any one time
on Line Advances equal to the least of (a) the Maximum Loan Amount, (b) the
Borrowing Base, (c) fifty percent (50%) of Adjusted Net Book Value, or (d) such
lesser amount as provided by this Agreement. Each of (a), (b), (c) and (d) is a
"Loan Amount Limitation." Borrower's obligation to repay the Line Advances shall
be evidenced by the Revolving note.
(c) Section 2 (b) (3). Clause (3) of Section 2 (b) is hereby superseded,
restated and replaced by the following:
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(3) Mandatory Repayments. For a period of not less than thirty (30)
consecutive calendar days during each Contract Year prior to the Termination
Date, commencing with the Contract Year beginning on July 1, 1998, the unpaid
principal balance of the Loan shall not exceed Thirty three and one-third
percent (33.3334%) of the Maximum Loan Amount.
(d) Section 2 (c). Section 2 (c) is hereby superseded, restated and
replaced by the following:
(c) Use of Proceeds. The proceeds of the Loan hereunder shall be used by
the Borrower solely to provide working capital to finance ongoing development
and construction of residential real estate and short term capital requirements
related to the Borrower's Florida real estate projects and/or other appropriate
short term general corporate purposes. The Borrower will not, directly or
indirectly, use any part of such proceeds for personal, consumer, family,
household, educational, agricultural or similar uses or for the purpose of
purchasing or carrying any margin stock within the meaning of Regulation G of
the Board of Governors of the Federal Reserve System or to extend credit to any
Person for the purpose of purchasing or carrying any such margin stock, or for
any purpose which violates, or is inconsistent with, Regulation X of such Board
of Governors.
(e) Section 2 (d). Section 2 (d) is hereby superseded, restated and
replaced by the following:
d. Loan Extension. Commencing no later than March 31, 1998, and on each
anniversary thereof if the Termination Date has been extended each year as
hereinafter provided, the Borrower may deliver to Bank a written request that
the Termination Date be extended for one (1) additional Contract Year. Provided
(i) the warranties and representations of Borrower contained in the Agreement
remain true, correct and complete in all material respects; (ii) all the
material covenants, terms and conditions of the Agreement remain satisfied;
(iii) no Event of Default, or event which upon the lapse of time, the giving of
notice, or both, could become an Event of Default, has occurred under the
Agreement; and (iv) Bank is in receipt of the quarterly and annual financial
statements mentioned in Sections 6 A (1)(c) and (d) of the Agreement, Bank will,
without prejudice, consider Borrower's request.
If Bank, at its sole option and in its sole and absolute discretion,
elects to offer an extension of the Termination Date for one (1) additional
Contract Year, Bank shall notify Borrower no later than July 1, 1998, and on
each anniversary thereof if the Termination Date has been extended the preceding
year and a like request for an additional one (1)
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Contract Year extension of the Termination Date has been timely received by Bank
from Borrower. If Bank does not notify Borrower of Bank's election to offer to
extend any Termination Date within the time limit as aforesaid, the applicable
Termination Date shall not be extended. Any offer by Bank to extend the
Termination Date for an additional Contract Year shall be on and subject to the
following terms and conditions:
(1) Closing. Closing on the one (1) Contract Year extension of the
Termination Date shall occur within thirty (30) days of the date Bank's notice
of its election to offer Borrower an extension of the Termination Date is
effective, but not later than August 1 following each Contract Year that a
request is received from Borrower.
(2) Documents. At closing Borrower shall execute and deliver to
Bank a Mortgage and Loan Extension Agreement and such other documents and
certificates and title insurance endorsements as Bank may reasonably request,
each of which shall be satisfactory in form and substance to Bank.
(3) Fees, Expenses and Other Payments. At closing Borrower shall
pay to Bank a Commitment Fee in the amount of one-quarter of one percent (0.25%)
of the then current Maximum Loan Amount; and shall further pay all recording
fees, documentary stamps (if any) and intangible tax on the Mortgage and Loan
Extension Agreement, and reasonable costs, fees and expenses incurred by Bank in
connection with the extension of the Termination Date.
(4) Limitation on Extension. Anything herein to the contrary
notwithstanding, the Termination Date shall not be extended by Bank more than
five (5) times.
(f) Section 3 (a) (20). Clause (20) of Section 3(a) is hereby superseded,
restated and replaced by the following:
(20) Appraisals. At any time during the term of this Agreement, upon the
election of Bank, but, provided no Event of Default has occurred under this
Agreement, not more frequently than two (2) times each Contract Year, Bank may
procure (at Borrower's expense) a current (within 30 days) appraisal of the
Mortgaged Property, satisfactory in form and amount to the Bank, prepared by an
appraiser selected by the Bank and in accordance with generally accepted and
established appraisal practices and in conformity with applicable law and
regulation and reviewed (at Borrower's expense) by the Bank's "in-house" senior
appraiser. Any appraisal may be adjusted by the Bank's appraiser to conform to
Bank's appraisal guidelines. Such appraisal, as adjusted by the Bank's
appraiser, shall
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conclusively establish Net Realizable Value as of the date thereof. All
appraisals, appraisal reviews and any updates thereof shall be at Borrower's
expense.
(g) Section 6 A (5). The following is hereby added to Section 6 A (5):
Once the aggregate of all Advances equal the Maximum Loan Amount Borrower shall
pay additional intangible tax which may be due on each subsequent Advance to the
Clerk of the Circuit Court in accordance with Chapter 199.143, Florida Statutes,
using the form of Affidavit attached hereto as Exhibit F or, at Borrower's
option, payment may be made directly to the Florida Department of Revenue.
Within thirty (30) days after each such Advance Borrower shall provide Bank with
evidence of the payment of additional intangible tax thereon.
(h) Section 6 C. Section 6 (C) is hereby superseded, restated and
replaced by the following:
C. Financial Covenants - Consolidated Tangible Net Worth. Borrower
undertakes, covenants and agrees that, until the full and complete payment,
performance and observance of the Loan, Borrower will maintain at all times its
Consolidated Tangible Net Worth at not less than Forty Two Million Dollars
($42,000,000.00).
4. Representations and Warranties. Borrower represents and warrants that
it has full power, authority and legal right to execute, deliver and perform the
Renewal Amended and Restated Consolidated Revolving Mortgage Note of even date
herewith, executed and delivered to Bank by Borrower (the "Renewal Note"), the
Mortgage and Loan Modification and Extension Agreement of even date herewith,
executed and delivered to Bank by Borrower (the "Mortgage Modification"), and
this Second Amendment, and that, as of the date hereof (i) the warranties and
representations of Borrower contained in the Agreement (as may be amended
hereby) are true, correct and complete in all material respects; (ii) all the
material covenants, terms and conditions of the Agreement (as may be amended
hereby) remain satisfied; (iii) no Event of Default, or event which upon the
lapse of time, the giving of notice, or both, could become an Event of Default,
has occurred under the Agreement; and (iv) Adjusted Net Book Value is an amount
not less than Twenty Million Dollars ($20,000,000.00).
5. Ratification of Loan Documents. Borrower and Bank each acknowledge that
the Loan Documents are valid and binding; that there are no defenses, set offs
or counterclaims thereto; nothing herein or in the Renewal Note and/or the
Mortgage Modification invalidates or shall impair
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or release any covenant, condition, agreement or stipulation in the Loan
Documents; and Borrower and Bank shall each perform and comply with and abide by
each of the covenants, agreements, conditions and stipulations of the Loan
Documents as amended hereby.
6. Fees, Expenses, Appraisal and Other Payments. At the time of execution
and delivery of this Second Amendment, Borrower shall pay to Bank a Commitment
Fee in the amount of Fifty Thousand Dollars ($50,000.00); and shall further pay
all recording fees, documentary stamps (if any) and intangible tax on the
Mortgage Modification, and all reasonable costs, fees and expenses incurred by
Bank in connection with this Second Amendment, including without limitation the
cost of the initial appraisal for the Contract Year July 1, 1997 to June 30,
1998, pursuant to Section 3(a) (20) of the Agreement as modified by this Second
Amendment, to be procured by Bank within thirty (30) days of the date of this
Second Amendment.
7. Miscellaneous.
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(a) Severability. If any one or more of the provisions of this
Second Amendment is held to be invalid, illegal or unenforceable in any respect
for any reason, the validity, legality and enforceability of any such provision
or provisions in every other respect and of the remaining provisions of this
Second Amendment shall not be in any way impaired, and each term or provision
shall be construed to be legal, valid, binding and enforceable to the maximum
extent permitted by law.
(b) Survival of Covenants, Agreements, Representations and
Warranties. All warranties, representations and covenants made by Borrower
herein or in any certificate or other instrument delivered by it or on its
behalf under this Second Amendment shall be considered to have been relied upon
by Bank and shall survive regardless of any investigation made by Bank or on its
behalf. All such statements and any such certificate or other instrument shall
constitute warranties and representations by Borrower hereunder.
(c) Headings. Paragraph headings have been inserted in this Second
Amendment as a matter of convenience of reference only; such paragraph headings
are not part of this Second Amendment and shall not be used in the
interpretation of this Second Amendment.
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(d) Time of the Essence. Time is hereby expressly made of the
essence with respect to the performance and/or satisfaction of each of the
provisions and conditions of this Second Amendment.
(e) Governing Law. The laws of the State of Florida shall govern the
construction of this Second Amendment and the rights and duties of Borrower and
Bank.
(f) Limited Modification/Conflicts. Except to the limited extent
expressly provided herein, the Loan Documents shall remain in full force and
effect. In the event of any inconsistency between the terms and conditions of
the Agreement and this Second Amendment, the terms and provisions of this Second
Amendment shall govern and control.
(g) Prior Negotiations Superseded. The terms and conditions of this
Second Amendment supersede and replace all prior discussions, negotiations and
side letter agreements with respect to the subject matter hereof, including,
without limitation, all those certain letters from Bank to Borrower dated as of
March 12, 1997, May 9, 1997, June 12, 1997, July 21, 1997, August 27, 1997,
September 7, 1997 and October 31, 1997.
IN WITNESS WHEREOF, the parties hereto have caused the Second Amendment to
be executed as of the day and year first above written.
Borrower:
ORIOLE HOMES CORP.,
a Florida corporation
By:____________________________________
Xxxxxxx X. Xxxx, Chairman of the
Board and Chief Executive Officer
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Bank:
OHIO SAVINGS BANK,
a federal savings bank
By:______________________________________
Name
Printed:___________________________
Title:________________________________
STATE OF FLORIDA )
)
COUNTY OF PALM BEACH )
Before me, a Notary Public in and for said County and State, on this
_______ day of November, 1997, personally appeared the above-named Oriole Homes
Corp., a Florida corporation, by Xxxxxxx X. Xxxx, its Chairman of the Board and
Chief Executive Officer, who acknowledged that he did sign the foregoing
instrument on behalf of said corporation, and that such signing was his free act
and deed, individually and as such officer, and the free act and deed of said
corporation. Xxxxxxx X. Xxxx is personally known to me.
---------------------------------------------
Print Name:__________________________________
(SEAL)
Notary Public, State of Florida at Large
My Commission Expires:_____________________
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STATE OF OHIO
)
)
COUNTY OF CUYAHOGA )
Before me, a Notary Public in and for said County and State, on this _____
day of November, 1997, personally appeared the above-named Ohio Savings Bank, a
federal savings bank, by __________________, its ______ President, who
acknowledged that he did sign the foregoing instrument on behalf of said bank
and that such signing was his free act and deed, individually and as such
officer, and the free act and deed of said bank.
___________________ is personally known to me.
---------------------------------------------
Print Name:__________________________________
(SEAL)
Notary Public, State of Ohio
My Commission Expires:_____________________
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EXHIBIT F TO LOAN AGREEMENT
NONRECURRING INTANGIBLE
PERSONAL PROPERTY TAX
AFFIDAVIT
---------
STATE OF FLORIDA )
:ss
COUNTY OF PALM BEACH )
BEFORE ME, the undersigned authority, personally appeared
____________________, who, after duly being placed under oath, deposes and
states as follows:
1. Affiant is ____________________ of Oriole Homes Corp., a Florida
corporation.
2. Affiant makes this Affidavit in connection with that certain Mortgage
and Security Agreement (Revolving Loan) to Ohio Savings Bank, dated July 13,
1993, in the initial amount of $10,000,000, recorded in Official Records Book
7800, Page 1590, of the Public Records of Palm Beach County, Florida, as
modified, extended and spread of record (the "Revolving Mortgage").
3. An additional amount of $________________ is being/will be borrowed
under the Revolving Mortgage and this Affidavit is made and executed for the
purpose of paying Nonrecurring Intangible Personal Property Tax upon such
additional amount in accordance with Chapter 199.143 Florida Statutes.
Further Affiant sayeth naught.
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Name Printed:_______________________
Sworn to, subscribed and acknowledged before me this ___ day of __________ ,
199__, by __________________________.
-------------------------------------
Notary Public, State of Florida at Large
Name Printed:________________________
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My Commission Expires:_______________
Personally known ______or produced ____________________Driver License.
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