EXHIBIT 10.173
ACQUISITION, CONSTRUCTION AND RECEIVABLE
LOAN, SECURITY AND AGENCY AGREEMENT
among
BLUEGREEN VACATIONS UNLIMITED, INC.
and
BLUEGREEN CORPORATION
(as Borrowers)
and
THE PARTIES WHICH HEREAFTER EXECUTE THIS AGREEMENT
(as Lenders)
and
TEXTRON FINANCIAL CORPORATION
(as Lender and Facility and Collateral Agent)
As of December 22, 2003
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ACQUISITION, CONSTRUCTION AND RECEIVABLE
LOAN, SECURITY AND AGENCY AGREEMENT
THIS ACQUISITION, CONSTRUCTION AND
RECEIVABLE LOAN, SECURITY AND AGENCY
AGREEMENT, dated as of December 22, 2003,
entered into by and among BLUEGREEN
VACATIONS UNLIMITED, INC., a Florida
corporation ("Bluegreen Vacations
Unlimited, Inc.") and BLUEGREEN
CORPORATION, a Massachusetts corporation
("Bluegreen Corporation", and together with
Bluegreen Vacations Unlimited, Inc.,
singly and collectively the "Borrower"),
and the parties, including TEXTRON
FINANCIAL CORPORATION ("TFC"), a Delaware
corporation, that execute and deliver
this Agreement in their respective
capacities as lenders hereunder
(collectively, the "Lenders" and each
individually, a "Lender") and TEXTRON
FINANCIAL CORPORATION as facility agent and
collateral agent ("Agent").
W I T N E S S E T H:
WHEREAS,
Borrower is engaged in the business of acquiring, constructing,
developing, owning, managing, selling and
otherwise dealing with Intervals at
the Resorts (as each such term is hereafter
defined);
WHEREAS,
Borrower has requested that Lenders, including Textron
Financial
Corporation, make a loan or loans to
Borrower to be used by Borrower for the
sole purpose of acquiring, constructing,
developing, renovating, rehabilitating,
refitting, furnishing and equipping the
Marathon Key Resort (as such term is
hereafter defined), and each Lender,
including Textron Financial Corporation,
has agreed, subject to the terms and
conditions of this Agreement, to make such
a loan or loans to Borrower in a maximum
aggregate amount as set forth opposite
each Lender's name on Schedule A-1 attached
hereto and made a part hereof, as
the same may hereafter be amended from time
to time;
WHEREAS,
furthermore Borrower, in order to provide liquidity in
connection
with its sale of Intervals at the Resorts,
has entered into this Agreement
whereby each Lender, including Textron
Financial Corporation, will also, subject
to the terms and conditions set forth
herein, agree to make a loan or loans to
Borrower in a maximum aggregate amount as
set forth opposite each Lender's name
on Schedule A-2 attached hereto and made a
part hereof, as the same may
hereafter be amended from time to time;
and
WHEREAS,
in connection with the Loans to be made by Lenders pursuant to
this Agreement, Textron Financial
Corporation has agreed to act as facility
agent and collateral agent for the other
Lenders and to perform such duties with
respect to the Loans as are expressly set
forth herein.
NOW, THEREFORE, in consideration of the
mutual covenants and agreements
contained in this Agreement, and for other
good and valuable consideration, the
receipt and adequacy of which are
acknowledged, the parties to this Agreement,
intending to be legally bound, agree as
follows:
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SECTION 1 -- DEFINITION OF TERMS
1.1
Capitalized terms used in this Agreement are defined in this
Section
1.1. The definitions include the singular
and plural forms of the terms defined.
(a)
Acquisition/Construction Advance. The term
"Acquisition/Construction
Advance" shall mean a portion of the
proceeds of the Loans advanced by Lenders
to Borrower in accordance with the terms of
this Agreement, the proceeds of
which Advance (as such term is hereafter
defined) are to be used by Borrower
solely for the acquisition, construction,
development, renovation,
rehabilitation, refitting, furnishing and
equipping of Marathon Key Resort, as
provided herein.
(b)
Acquisition/Construction Loan Component. The term
"Acquisition/Construction Loan Component"
shall mean the portion of the Loan or
Loans in amount not to exceed $11,800,000
at any time made to Borrower in
accordance with Section 2.1 hereof and to
be used by Borrower solely for the
acquisition, development, construction,
renovation, rehabilitation, refitting,
furnishing and equipping of the Marathon
Key Resort as provided herein.
(c)
Acquisition/Construction Note. The term
"Acquisition/Construction
Note" shall mean the secured promissory
note, in the form attached hereto and
made a part hereof as Exhibit A, dated the
date hereof and executed and
delivered by each Borrower to TFC, as agent
for each Lender, evidencing the
Acquisition/Construction Loan
Component.
(d)
Acquisition/Construction Loan Maturity Date. The term
"Acquisition/Construction Loan Component
Maturity Date" shall mean January 1,
2006.
(e)
Additional Eligible Resorts or Additional Eligible Resort. The
terms
"Additional Eligible Resorts" and
"Additional Eligible Resort" shall have the
meanings ascribed to such terms in Section
3.7 hereof.
(f)
Advance. A portion of the proceeds of the Loan advanced from time
to
time by Lenders to Borrower in accordance
with the terms of this Agreement,
including a Revolving Loan Advance (as
hereinafter defined) and an
Acquisition/Construction Advance.
(g)
Affidavit of Borrower. The term "Affidavit of Borrower" shall mean
a
sworn affidavit of each Borrower, and such
other parties as TFC may require, to
the effect that all statements, invoices,
bills and other expenses incident to
the acquisition, construction, development,
renovation, rehabilitation,
refitting, furnishing and equipping of the
Marathon Key Resort (as hereafter
defined) incurred to a specific date, have
been paid in full, except for (a)
amounts retained pursuant to any
Construction Contract (as hereafter defined)
and (b) items to be paid from the proceeds
of an Acquisition/Construction
Advance as approved in writing by TFC as
provided in this Agreement.
(h)
Affiliate. Any party controlled by, controlling, or under
common
control with, either Borrower.
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(i)
Agreement. This Acquisition, Construction and Receivable Loan,
Security and Agency Agreement by and among
Borrower, Agent and each Lender which
executes this Agreement (including the
Exhibits and Schedules to it), as it may
be amended from time to time.
(j)
Application for Acquisition/Construction Advance. The term
"Application for Acquisition/Construction
Advance" shall mean a written
application to TFC in the form of Exhibit B
attached hereto and made a part
hereof, by Borrower and such other parties
as TFC may require, requesting an
Acquisition/Construction Advance for the
payment of the items described therein,
or for the reimbursement to Borrower of
amounts previously paid by Borrower, for
the acquisition, construction, development,
renovation, rehabilitation,
refitting, furnishing and equipping of the
Marathon Key Resort through the date
of such Advance as described therein.
Borrower shall attach to each Application
for Acquisition/Construction Advance a
schedule specifying by name, current
address, and amount, all amounts owed to
all independent third parties to whom
Borrower is obligated for labor, materials,
or services supplied for the
acquisition, construction, development,
renovation, rehabilitation, refitting,
furnishing and equipping of the Marathon
Key Resort and all other expenses
incident thereto, and specifying those
budgeted items which have been performed
by Borrower's Agents (as hereafter
defined). The Application for
Acquisition/Construction Advance also shall
contain an Affidavit of each
Borrower, accompanied, where required by
TFC, by an AIA Application and
Certification for Payment signed by the
Architect and Contractor, and such
schedules, affidavits, releases, waivers,
statements, invoices, bills, and other
documents as TFC and the Title Company may
reasonably request.
(k)
Approved Budget. The term "Approved Budget" shall mean the
budget
attached as Schedule B attached hereto and
made a part hereof, or such other
budget as may hereafter be approved by TFC
in writing, for the acquisition,
construction, development, renovation,
rehabilitation, refitting, furnishing and
equipping of the Marathon Key Resort. The
Approved Budget also includes any
decreases or increases as permitted under
this Agreement.
(l)
Approved Construction Schedule. The term "Approved Construction
Schedule" shall mean the schedule and order
of construction of the Improvements
(as hereafter defined) set forth in
Schedule C attached hereto and made a part
hereof, or such other schedule as may
hereafter be approved by TFC in writing,
and any modifications permitted in
accordance with this Agreement.
(m)
Approved Delegate. The term "Approved Delegate" shall have the
meaning
ascribed to such term in Section 13.10(a)
hereof.
(n)
Architect. The term "Architect" shall mean Bender and Associates,
the
architect for design of the plans and
specifications for the Improvements at
Marathon Key Resort, or any successor
architect approved by the TFC.
(o)
Architect's Consent. The term "Architect's Consent" shall mean
the
consent of the Architect to the Assignment
of Architectural Contract, in the
form attached thereto.
(p)
Architectural Contract. The term "Architectural Contract" shall
mean
AIA Document B141 Standard Form of
Agreement between Borrower and Architect
entered into or to be entered into by Owner
and Architect for architectural
services relating to the construction,
development, renovation and
rehabilitation of the Marathon Key Resort,
and in form and substance reasonably
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acceptable to TFC, as the same may be
amended from time to time with TFC's prior
written approval, which approval TFC agrees
not to unreasonably withhold or
delay.
(q)
Assignment of Architectural Contract. The term "Assignment of
Architectural Contract" shall mean that
certain Assignment of Architectural
Contract and Plans and Specifications,
dated as of the date hereof, by Borrower
to Agent, as agent on behalf of each
Lender, in the form attached hereto and
made a part hereof as Exhibit C, the same
may be amended or modified from time
to time.
(r)
Assignment of Construction Contract. The term "Assignment of
Construction Contract" shall mean that
certain Assignment of Construction
Contract, dated as of the date hereof, by
Borrower to Agent, as agent on behalf
of each Lender, in the form attached hereto
and made a part hereof as Exhibit D,
as the same may be amended or modified from
time to time.
(s)
Assignment of Management Agreement. The term "Assignment of
Management
Agreement" shall mean an assignment, in the
form attached hereto and made a part
hereof as Exhibit F, by Borrower to Agent
on behalf of each Lender, of all of
Borrower's rights under each management
agreement for the Marathon Key Resort.
(t)
Assignment of Notes Receivable and Mortgages. The term "Assignment
of
Notes Receivable and Mortgages" shall mean
a recordable assignment of notes
receivable and mortgages, in the form
attached hereto and made a part hereof as
Exhibit G, made by Borrower in favor of
Agent, as agent for each Lender,
evidencing the assignment to Agent, as
agent for each Lender, of all of the
Pledged Notes Receivable and Mortgages.
(u)
Assignment of Plans and Permits. The term "Assignment of Plans
and
Permits" shall mean the assignment, in the
form attached hereto and made a part
hereof as Exhibit H, by Borrower to Agent,
on behalf of each Lender, of all
Plans and Permits (as such terms are
hereafter defined).
(v) Assignment
of Rents and Leases. The term "Assignment of Rents and
Leases" shall mean that certain Assignment
of Rents and Leases, dated as of the
date hereof, in the form attached hereto
and made a part hereof as Exhibit E, by
Borrower to Agent, as agent on behalf of
each Lender, assigning to Agent on
behalf of each Lender, all of Borrower's
rights under each lease, sublease,
license, occupancy and other possessory
agreements with respect to the Marathon
Key Resort, together with all rents,
revenues, room charges, tariffs, royalties,
fees and income related thereto.
(w)
Intentionally Omitted.
(x)
Borrower's Agents. The term "Borrower's Agents" shall mean the
employees, officers, directors, managers,
executives and persons owning or
controlling a controlling interest in each
Borrower or any Affiliate of each
Borrower. "Controlling interest" shall mean
the ownership or right to vote 5% or
more of the capital stock of each
Borrower.
(y)
Borrower's Certificate and Request for Advance. The term
"Borrower's
Certificate and Request for Advance" shall
mean the form attached hereto and
made a part hereof as Exhibit J, as the
same may be modified from time to time.
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(z)
Borrowing Base. With respect to each Eligible Note Receivable
pledged
to the Agent, as agent for Lenders, in
connection with each Revolving Loan
Advance, an amount equal to ninety percent
(90%) of the remaining principal
balance of each such Eligible Note
Receivable.
(aa) Borrowing Base
Report. The term "Borrowing Base Report" shall have
the meaning ascribed to such term in
Section 2.5(b) and shall be in the form
attached hereto and made a part hereof as
Exhibit P.
(bb)
Business Day. Each day which is not a Saturday, a Sunday or a
legal
holiday under the laws of the State of
Rhode Island, the State of Connecticut or
the State of Florida.
(cc)
Capital Adequacy Events. The term "Capital Adequacy Events"
shall
have the meaning ascribed to such term in
Section 2.11 hereof.
(dd)
Closing Date. The date of this Agreement.
(ee) Code.
The Uniform Commercial Code in force in the State of Rhode
Island as amended from time to time.
(ff)
Collateral. The term "Collateral" shall have the meaning ascribed
to
such term in Section 3 hereof.
(gg)
Collateral Data Report. The term "Collateral Data Report" shall
have
the meaning ascribed to such term in
Section 2.5(b) hereof and shall be in the
form attached hereto and made a part hereof
as Exhibit L.
(hh)
Collection Costs. The term "Collection Costs" shall have the
meaning
ascribed to such term in Section 2.8(a)
hereof.
(ii)
Commitment. The term "Commitment" shall refer singly to the
obligation of each Lender to make a Loan or
Loans to the Borrower in an
aggregate amount not to exceed the amount
set forth on Schedule A-1 and Schedule
A-2 hereto, as the case may be, as the same
may hereafter be amended from time
to time, for each Lender and collectively
the aggregate amount of all Loans to
be made by all Lenders hereunder.
(jj)
Commitment Fee. The term "Commitment Fees" shall mean commitment
fees
for the Acquisition/Construction Loan
Component and the Revolving Loan Component
in the amounts and payable as provided in
Section 2.12 hereof.
(kk)
Commitment Letter. The term "Commitment Letter" shall mean the
commitment letter dated June 27, 2003,
along with any extensions thereto, issued
by TFC with respect to the Loan.
(ll)
Common Elements. All common elements at a Resort, including but
not
limited to any limited common elements, as
each such common element is defined
or provided for in the applicable
Declaration or other Timeshare Documents.
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(mm)
Completion. The term "Completion" shall mean the substantial
completion of the construction,
development, renovation and rehabilitation of
the Improvements at the Marathon Key Resort
in accordance with the Approved
Budget, the Approved Construction Schedule,
the Construction Contracts, the
Architectural Contract, this Agreement and
the Plans, as evidenced by: (a) a
permanent certificate of occupancy or its
equivalent, if applicable, permitting
legal occupancy of the Marathon Key Resort,
including each Unit and all related
facilities and amenities, issued by the
local Governmental Authorities with
jurisdiction over construction,
development, renovation, rehabilitation, use and
occupancy of the Marathon Key Resort, (b) a
certificate of the Contractor and
Borrower in form and substance reasonably
satisfactory to TFC regarding
completion of the construction,
development, renovation and rehabilitation of
the Marathon Key Resort, and (c) a
certificate of completion of the Inspecting
Architects/Engineers and Borrower regarding
construction, development,
renovation and rehabilitation of the
Marathon Key Resort in form and substance
reasonably satisfactory to TFC.
(nn)
Construction Contracts. The term "Construction Contracts" shall
mean
the AIA Document A111 Standard Form of
Agreement Between Owner and Contractor
entered into or to be entered into by Owner
and Contractor and any other
contract for construction, development,
renovation and rehabilitation of the
Marathon Key Resort, each in form and
substance reasonably acceptable to TFC, as
the same may be amended from time to time
with TFC's prior written approval,
which approval TFC agrees not to
unreasonably withhold.
(oo)
Contractor. The term "Contractor" shall mean the general
contractor
to be retained by Borrower for the
completions of the Improvements in accordance
with the Approved Budget, the Construction
Contracts, the Approved Construction
Schedule, the Plans and this Agreement, or
any successor contractor, as approved
by TFC.
(pp)
Contractor's Consent. The term "Contractor's Consent" means the
consent of the Contractor to the Assignment
of Construction Contract, in the
form attached thereto.
(qq)
Custodian. Lender's exclusive agent, custodian and bailee, who
shall
be such Person or Persons designated by
Borrower and approved by Agent in its
sole and absolute discretion, for the
purposes of maintaining possession and
control of: (i) the original Pledged Notes
Receivable, (ii) the original
Mortgages, (iii) the original Owner
Beneficiary Agreement or other purchase
contract (including addendum) related to
such Pledged Notes Receivable and
Mortgages, (iv) the original mortgage title
policy for each Mortgage, and (v)
originals or true copies of the related
truth in lending disclosure, loan
application, warranty deed, and, if
required by Agent, the related Purchaser's
acknowledgement receipt and the Exchange
Company application and disclosures, as
provided in Section 3.6.
(rr)
Custodial Agreement. The term "Custodial Agreement" shall mean
the
agreement, in form and substance reasonably
acceptable to TFC, between Borrower,
TFC and Custodian for the purposes of
maintaining possession and control on
behalf of and as agent for each Lender of:
(i) the original Pledged Notes
Receivable, (ii) the original Mortgages,
(iii) the original Owner Beneficiary
Agreement or other purchase contract
(including addendum) related to such
Pledged Notes Receivable and Mortgages,
(iv) the original mortgage title policy
for each Mortgage, and (v) originals or
true copies of the related truth in
lending disclosure, loan application,
warranty deed,
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and, if required by Agent, the related
Purchaser's acknowledgement receipt and
the Exchange Company application and
disclosures.
(ss)
Debtor Relief Laws. Any applicable liquidation,
conservatorship,
bankruptcy, moratorium, rearrangement,
insolvency, reorganization or similar
law, proceeding or device providing for the
relief of debtors from time to time
in effect and generally affecting the
rights of creditors.
(tt)
Declaration or Declarations. With respect to each Resort, the
applicable Declaration or Declarations
described on Schedule D attached hereto
and made a part hereof.
(uu)
Deeded Timeshare Interest. A Timeshare Interest represented by
a
limited warranty deed issued by Bluegreen
Vacations Unlimited, Inc. in the name
of the Trustee.
(vv)
Default. An event or condition the occurrence of which immediately
is
or, with a lapse of time or the giving or
notice or both, becomes an Event of
Default.
(ww)
Default Rate. The term "Default Rate" shall have the meaning given
to
such term in the Note.
(xx)
Division or Commission. The Governmental Authority of each state
in
which a Resort is located, having
jurisdiction over the establishment and
operation of the Resort in question and the
sale of Intervals at such Resort.
(yy)
Intentionally Omitted.
(zz)
Eligible Notes Receivable. Those Pledged Notes Receivable which
satisfy each of the following criteria:
(i)
Either Borrower shall be the sole payee;
(ii) it arises
from a bona fide sale by either Borrower of one
or more Intervals;
(iii) the Interval
sale from which it arises shall not have been
cancelled by Purchaser, and any statutory or other
applicable cancellation or rescission period shall have
expired and the Interval sale is otherwise in compliance
with this Agreement;
(iv) the
Pledged Note Receivable is generated from the sale of
an Interval and it is secured by a Mortgage on the
purchased Interval;
(v) principal and
interest payments on it are payable to
either Borrower in legal tender of the United States;
(vi) payments
of principal and interest on it are payable in
equal monthly installments;
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(vii) it shall have an
original term of no more than one hundred
twenty (120) months;
(viii) a
cash down payment has been received from Purchaser or
the maker in an amount equal to at least ten percent (10%)
of the actual purchase price of each Interval, and
Purchaser shall have received no cash or other rebates of
any
kind;
(ix)
Intentionally Omitted.
(x) no
monthly installment is more than thirty (30) days
contractually past due at the time of an Advance in
respect of such Eligible Note Receivable, or more than
sixty (60) days contractually past due at any time;
(xi) the rate
of interest payable on the unpaid balance is at
least the rate required so that when the Advance is made
in respect of such Eligible Note Receivable the average
interest rate on all Eligible Notes Receivable in respect
of which Advances are outstanding shall not be less than
fifteen percent (15%) per annum at any time provided,
however, that the interest rate on each such Pledged Note
Receivable shall not be less than eleven and 90/100
percent (11.9%) per annum;
(xii) subject to the
rules of the Vacation Club, Purchaser of
the related Interval has immediate access, for the
timeshare period related to such purchase, to the Interval
described in the Mortgage securing such Eligible Note
Receivable, which Interval has been completed, developed,
and furnished in accordance with the specifications
provided in the Purchaser's Owner Beneficiary Agreement or
other purchase contract, public offering statement and
other Timeshare Documents; and Purchaser has, subject to
the terms of the Declaration, Owner Beneficiary Agreement
or other purchase contract, public offering statement and
other Timeshare Documents, complete and unrestricted
access to the related Interval and the Resort;
(xiii)
neither
Purchaser of the related Interval or any other
maker of the Note is a Borrower's Agent or an Affiliate of
either Borrower;
(xiv) Purchaser or
other maker has no claim against either
Borrower and no defense, set-off or counterclaim with
respect to the Note Receivable;
(xv) the
maximum remaining principal balance of any such Note
Receivable shall not exceed $30,000 and the total maximum
remaining principal balance of all Notes Receivable
executed by any one Purchaser or other maker shall not
exceed $50,000 in the aggregate (or such greater amount as
may be approved in writing in advance by TFC);
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(xvi) it is executed
by a U.S. resident; provided, however, that
no more than twenty percent (20%) of the outstanding
principal balance of all Eligible Notes Receivable may at
any time be comprised of Notes Receivable executed by
Canadian residents, and, to the extent such outstanding
principal balance of such Notes exceeds twenty percent
(20%), they shall not be considered Eligible Notes
Receivable;
(xvii) the
original of such Note Receivable has been endorsed to
Agent and delivered to Custodian as provided in this
Agreement, and the terms thereof and all instruments
related thereto shall comply in all respects with all
applicable federal and state laws and the regulations
promulgated thereunder;
(xviii) the Unit
in which the Interval being financed is located,
shall not be subject to any Lien which is not previously
consented to in writing by Agent.
(xix) all accrued and
payable applicable taxes and other
assessments on the related Interval have been paid in
full; and
(xx)
corporations, partnership or trusts may be allowed as
obligors under a Pledged Note Receivable subject to TFC's
prior written approval.
(aaa)
Encumbered Intervals. The Intervals subject to the Mortgages.
(bbb)
Environmental Indemnification Agreement. The term
"Environmental
Indemnification Agreement" shall mean the
Environmental Indemnification
Agreement, in the form attached hereto and
made a part hereof as Exhibit K, to
be made by Borrower to Lenders pursuant to
this Agreement, as the same may be
amended from time to time.
(ccc)
Environmental Laws. Comprehensive Environmental Response,
Compensation and Liability Act of 1980, as
amended from time to time ("CERCLA"),
the Resource Conservation and Recovery Act
of 1976, as amended from time to time
("RCRA"), the Superfund Amendments and
Reauthorization Act of 1986, as amended,
the federal Clean Air Act, the federal
Clean Water Act, the federal Safe
Drinking Water Act, the federal Toxic
Substances Control Act, the federal
Hazardous Materials Transportation Act, the
federal Emergency Planning and
Community Right to Know Act of 1986, the
federal Endangered Species Act, the
federal Occupational Safety and Health Act
of 1970, the federal Water Pollution
Control Act, all state and local
environmental laws, rules and regulations of
each state in which a Resort is located, as
all of the foregoing legislation may
be amended from time to time, and any
regulations promulgated pursuant to the
foregoing; together with any similar local,
state or federal laws, rules,
ordinances or regulations either in
existence as of the date hereof, or enacted
or promulgated after the date of this
Agreement, that concern the management,
control, storage, discharge, treatment,
containment, removal and/or transport of
Hazardous Materials or other substances
that are or may become a threat to
public health or the environment; together
with any common law theory involving
Hazardous Materials or substances which are
(or alleged to be) hazardous to
human health or the environment, based on
nuisance, trespass, negligence, strict
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liability or other tortuous conduct, or any
other federal, state or local
statute, regulation, rule, policy, or
determination pertaining to health,
hygiene, the environment or environmental
conditions.
(ddd)
Event of Default. Defined in Section 8.1 of this Agreement.
(eee)
Excess Funding. The term "Excess Funding" shall have the
meaning
ascribed to such term in Section 2.9(b)
hereof.
(fff)
Exchange Company. The term "Exchange company" shall mean RCI or
Interval International or any successor
approved in writing by TFC, which
approval TFC agrees not to unreasonably
withhold.
(ggg)
Financial Statements. The tax returns and balance sheets and
statements of income and expense of each
Borrower, and the related notes and
schedules delivered by each Borrower to TFC
prior to the date of this Agreement
and provided for in Section 4.1 of this
Agreement; and the monthly, quarterly
and annual financial statements and reports
required to be provided to TFC
pursuant to Section 7.1(h) (i), (ii),
(iii), (iv), (v), (vi), (xi) and (xii).
(hhh)
Fiscal Year. The term "Fiscal Year" shall have the meaning
ascribed
to such term in Section 7.1(h)(iii)
hereof.
(iii)
GAAP. Generally accepted accounting principles, applied on a
consistent basis, as described in Opinions
of the Accounting Principles Board of
the American Institute of Certified Public
Accountants and/or in statements of
the Financial Accounting Standards Board
which are applicable in the
circumstances as of the date in
question.
(jjj)
Governmental Requirements. The term "Governmental Requirements"
shall mean all federal, state, and local
rules, regulations, ordinances, laws,
and statutes which affect the use and
occupancy of the Resorts, the completion,
use and occupancy of the Improvements, or
Borrower's right to create or sell
Intervals.
(kkk)
Governmental Authority or Governmental Authorities. The terms
"Governmental Authority" and "Governmental
Authorities" means the United States
of America and the state, county and town
in which a Resort is located, and all
other governmental authorities having
jurisdiction over Borrower, the Resorts,
or the creation or sale of Intervals.
(lll)
Hazardous Materials. "Hazardous substances," "hazardous waste"
or
"hazardous constituents," "toxic
substances", or "solid waste", as defined in
the Environmental Laws, and any other
contaminant or any material, waste or
substance which is petroleum or petroleum
based, asbestos, polychlorinated
biphenyls, flammable explosives, or
radioactive materials.
(mmm)
Improvements. The term "Improvements" means the construction,
renovation, rehabilitation and development
of all improvements at the Marathon
Key Resort as a 58 Unit timeshare resort
consisting of 13 hotel units, 24 one
bedroom Units and 21 two bedroom Units, as
provided in the Architectural
Contract, the Construction Contracts, this
Agreement and the Plans.
10
<PAGE>
(nnn)
Improvements Completion Date. The term "Improvements Completion
Date" shall mean the deadline for
completion of each element of construction,
development, renovation and rehabilitation
of the Improvements as set forth on
the Approved Construction Schedule, which
shall not be later than October 1,
2004.
(ooo)
Indemnified Lender Parties. The term "Indemnified Lender
Parties"
shall have the meaning ascribed to such
term in Section 7.1(v) hereof.
(ppp)
Ineligible Notes Receivable. The term "Ineligible Notes
Receivable"
shall have the meaning ascribed to such
term in Section 2.9(b) hereof
(qqq)
Initial Revolving Loan Advance. The term "Initial Revolving
Loan
Advance" shall mean the first Advance under
the Revolving Loan Component, which
shall occur not later than the Initial
Revolving Loan Advance Date.
(rrr)
Initial Revolving Loan Advance Date. The term "Initial
Revolving
Loan Advance Date" shall mean the earlier
of: (i) the date on which the Initial
Revolving Loan Advance is made, or (ii)
March 1, 2004.
(sss)
Inspecting Architects/Engineers. The term "Inspecting
Architects/Engineers" shall mean such
employees, representatives, and agents of
TFC or other third parties, who may, from
time to time, conduct inspections of
the Improvements, the Marathon Key Resort
and other Resorts, review Borrower's
compliance with the Agreement or perform
other services related thereto, the
costs of which are to be borne by Borrower,
provided, however, that if no
Default or Event of Default has occurred,
Borrower shall not be required to bear
the expense of more than two (2) such
inspections per year.
(ttt)
Interest Rate. The term "Interest Rate" shall mean: (i) with
respect
to the Acquisition/Construction Loan
Component, a variable rate of interest,
adjusted as of the first Business Day of
each month, equal to the sum of the
Prime Rate (as defined hereafter), plus one
and one-quarter percent (1.25%) per
annum, but in no event less than six and
one-quarter percent (6.25%) per annum
(the "Acquisition/Construction Loan
Component Interest Rate"); and (ii) with
respect to the Revolving Loan Component, a
variable rate of interest, adjusted
as of the first Business Day of each month,
equal to the sum of the Prime Rate,
plus one percent (1.0%) per annum, but in
no event, less than six percent (6.0%)
per annum (the "Revolving Loan Component
Interest Rate"). Interest shall be
computed on the average monthly outstanding
principal balance of the component
in question at the applicable interest rate
on the basis of a 360-day year and
twelve 30 day months.
(uuu)
Intentionally Omitted.
(vvv)
Interval. A Timeshare Interest compromised of a right to use
and
occupy a Unit for a certain period of time
each year or every other year in
perpetuity coupled with an undivided fee
simple estate or an estate for years
therein acquired pursuant to an Owner
Beneficiary Agreement.
(www)
Inventory Control Procedures. The term "Inventory Control
Procedures" shall have the meaning ascribed
to such term in Section 6.24 hereof.
11
<PAGE>
(xxx)
Lender Advance Report. The term "Lender Advance Report" shall
have
the meaning ascribed to such term in
Section 2.5(b) hereof.
(yyy)
Lien. Any interest in property securing an obligation owed to,
or
claim by, a Person other than the owner of
such property, whether such interest
arises in equity or is based on the common
law, statute, or contract.
(zzz) Loan
or Loans. The terms "Loan" and "Loans" mean, as the context
requires, singly each loan and collectively
all loans made by the Lenders to
either Borrower pursuant to this Agreement.
The Loan shall consist of the
Revolving Loan Component in a maximum
amount not to exceed $30,000,000 and the
Acquisition/Construction Loan Component in
a maximum amount not to exceed
$11,800,000, which amounts shall be repaid
as provided in Section 2.8 hereof.
Notwithstanding the foregoing, the maximum
outstanding principal balance of the
Loan shall not exceed $30,000,000 at any
time.
(aaaa)
Loan Documents. Collectively, this Agreement and the following
documents and instruments listed below as
such agreements, documents,
instruments or certificates may be amended,
renewed, extended, restated or
supplemented from time to time.
(i) This
Agreement;
(ii) The
Revolving Loan Component Note;
(iii) The
Acquisition/Construction Loan Component Note;
(iv) The
Environmental Indemnification Agreement;
(v) The
Assignment of Notes Receivable and Mortgages;
(vi) Borrower's
Certificate and Request for Advance;
(vii) The Lockbox
Agreement;
(viii) The
Marathon Key Resort Mortgage;
(ix) The
Assignment of Rents and Leases;
(x)
Financing Statements; UCC-1 Financing Statements covering
the Collateral, to be filed with the Secretary of State
and/or such other office where UCC-1 Financing Statements
are required to be filed pursuant to the Code;
(xi) The
Assignment of Architectural Contract;
(xii) The Assignment
of Construction Contract;
(xiii) The
Assignment of Plans and Permits;
(xiv) The Servicing
Agreement;
12
<PAGE>
(xv)
Application for Acquisition/Construction Advance;
(xvi) Assignment of
Management Agreement;
(xvii)
Negative Pledge;
(xviii)
Custodial Agreement; and
(xix) Other Items;
Such other agreements, documents,
instruments, certificates and materials as TFC may
reasonably request to evidence the Obligations; to
evidence and perfect the rights and Liens and security
interests of Agent, as agent for Lenders, contemplated by
the Loan Documents, and to effectuate the transactions
contemplated herein, as such agreements, documents,
instruments or certificates may be hereafter amended,
renewed, extended, restated or supplemented from time to
time.
(bbbb)
Loan Year. The term "Loan Year" shall mean, with respect to the
Revolving Loan Component only, the period
from the Initial Revolving Loan
Advance Date through the last day of the
immediately following full twelve (12)
months and each twelve (12) months
thereafter.
(cccc)
Lockbox Agent. Fleet Bank, or such other financial institution
as
may be approved by TFC in writing from time
to time, which approval TFC agrees
not to unreasonably withhold.
(dddd)
Lockbox Agreement. The Lockbox Agreement, in form and substance
reasonably satisfactory to TFC, by and
among Borrower, Agent, Servicing Agent
and Lockbox Agent, pursuant to which the
Lockbox Agent is to provide lockbox,
reporting and related services and is to
provide for the receipt of payments on
the Notes Receivable and the disbursement
of such payments to Agent.
(eeee)
Management Agreements. The term "Management Agreements" shall
mean
each management agreement for the Marathon
Key Resort and each management
agreement for the Additional Eligible
Resorts.
(ffff)
Marketing and Sales Expenses. The term "Marketing and Sales
Expenses" shall mean all promotion, lead
generation, sales commissions and all
other marketing expenses incurred or paid
by Borrower pursuant to any marketing
agreements or otherwise.
(gggg)
Mandatory Prepayment. Any prepayment required by Section 2.9(b)
of
this Agreement.
(hhhh)
Marathon Key Resort. The term "Marathon Key Resort" shall mean
the
real property presently known as the
Marathon Best Western Resort, a
seventy-nine (79) room hotel, to be
developed by Borrower as a fifty-eight (58)
unit timeshare resort, located in Marathon
Key, Florida and more particularly
described in Schedule E attached hereto and
made a part hereof.
13
<PAGE>
(iiii)
Marathon Key Resort Mortgage. The term "Marathon Key Resort
Mortgage" shall mean the properly recorded,
first priority mortgage, executed
and delivered by Bluegreen Vacations
Unlimited, Inc. to Agent, as agent for each
Lender, in the form attached hereto and
made a part hereof as Exhibit M,
securing and encumbering all of the right,
title and interest of Bluegreen
Vacations Unlimited, Inc. in the Marathon
Key Resort, and related or appurtenant
easements, access and use rights and
benefits.
(jjjj)
Material Party. The term "Material Party" shall have the
meaning
ascribed to such term in Section
4.1(f)(iii) and 4.5(f) hereof.
(kkkk)
Material Subcontractor. The term "Material Subcontractor" shall
have the meaning ascribed to such term in
Section 4.1(f)(xvii) hereof.
(llll)
Maximum Available Revolving Amount. The term "Maximum Available
Revolving Amount" shall have the meaning
ascribed to such term in Section 2.2(b)
hereof.
(mmmm)
Maximum Loan Amount. The term "Maximum Loan Amount" shall have
the
meaning ascribed to such term in Section
2.1(b) hereof.
(nnnn) Minimum
Loan Usage Fee. The term "Minimum Loan Usage Fee" shall
have the meaning ascribed to such term in
Section 2.10 hereof.
(oooo)
Mortgage. A properly recorded, first priority mortgage, deed of
trust, deed to secure debt, assignment of
beneficial interest or other security
instrument, as applicable, executed and
delivered by the Trustee to Bluegreen
Corporation, securing a Pledged Note
Receivable and encumbering all of the
right, title and interest of the Trustee in
the related Encumbered Interval and
Common Elements, and related or appurtenant
easement, access and use rights and
benefits.
(pppp)
Negative Pledge. The term "Negative Pledge" shall mean the
properly
recorded negative pledge for each Resort
prohibiting the assignment of any
Management Agreement or reservation system
for any Resort, except as expressly
provided herein, executed and delivered by
Borrower to Agent, as Agent for each
Lender, in the form attached hereto and
made a part hereof as Exhibit S.
(qqqq)
Note. The term "Note" shall mean, singly and collectively, the
Revolving Loan Component Note and the
Acquisition/Construction Loan Component
Note.
(rrrr)
Note Receivable. The term "Note Receivable" shall mean a
promissory
note executed in favor of Borrower in
connection with a Purchaser's acquisition
of an Interval at the Resorts.
(ssss)
Notice of Borrowing. The term "Notice of Borrowing" shall have
the
meaning ascribed to such term in Section
2.5(a) hereof.
(tttt)
Obligations. All amounts due or becoming due to each Lender in
respect of the Loan or Loans under any of
the Loan Documents, including
principal, interest, prepayment premiums,
contributions, taxes, insurance, loan
charges, custodial fees, attorneys' and
paralegals'
14
<PAGE>
fees and expenses and other fees or
expenses incurred by a Lender or advanced to
or on behalf of Borrower by a Lender
pursuant to any of the Loan Documents, and
the prompt and complete payment and
performance by Borrower of all obligations,
indebtedness and liabilities pursuant to
this Agreement or any of the Loan
Documents or otherwise
(uuuu)
Operating Contract or Operating Contracts. The terms "Operating
Contract" and "Operating Contracts" shall
have the meaning ascribed to such
terms in Section 6.21 hereof.
(vvvv)
Operating Expenses. The term "Operating Expenses" shall mean
the
total of all expenditures, computed in
accordance with Generally Accepted
Accounting Principles, of whatever kind
relating to the ownership, operation,
maintenance and management of the Resorts
that are incurred on a regular monthly
or other periodic basis, including, without
limitation, utilities, ordinary and
capital repairs and maintenance, insurance
premiums, license fees, property
taxes and assessments, management fees,
payroll and related taxes, computer
processing charges, operational equipment
or other lease payments as approved by
TFC, and other similar costs.
(wwww)
Opinion of Counsel. The term "Opinion of Counsel" shall mean
the
opinions of Borrower's legal counsel,
satisfactory to TFC, in the forms attached
hereto and made a part hereof as Exhibits
R-1 and R-2, executed and delivered to
the Agent, on behalf of the Lenders, as
required hereunder.
(xxxx)
Owner Beneficiary. The Purchaser under an Owner Beneficiary
Agreement who acquires Owner Beneficiary
Rights with appurtenant Vacation
Points.
(yyyy)
Owner Beneficiary Agreement. That certain owner beneficiary
agreement executed by a Purchaser in
connection with the purchase of Owner
Beneficiary Rights and appurtenant Vacation
Points, pursuant to which the
Purchaser thereunder directs Bluegreen
Vacations Unlimited, Inc. to immediately
convey the Timeshare Interest purchased
thereunder to the Trustee and the
Trustee to hold such Timeshare Interest
pursuant to the Trust Agreement, at
which time the Purchaser becomes a member
and an Owner Beneficiary of the
Vacation Club, is identified as an Owner
Beneficiary in a schedule attached to
the Trust Agreement, as amended from time
to time to include each new Owner
Beneficiary, and is entitled to certain
Owner Beneficiary Rights under the Trust
Agreement and a specific number of Vacation
Points corresponding to such rights,
which Vacation Points may be used by the
Owner Beneficiary for lodging for
varying lengths of time at the various
Resorts.
(zzzz)
Owner Beneficiary Rights. The beneficial rights provided to an
Owner Beneficiary under the Trust
Agreement, which rights shall specifically
include the rights of performance provided
to Owner Beneficiaries by the Trustee
and Vacation Points.
(aaaaa)
Participant. The term "Participant" shall mean, singly and
collectively, any bank or other entity,
which is indirectly or directly funding
any Lender with respect to the Loan, in
whole or in part, including, without
limitation, any direct or indirect assignee
of, or participant in, the Loan.
15
<PAGE>
(bbbbb)
Payment Authorization Agreement. The term "Payment
Authorization
Agreement" shall mean any pre-authorized
electronic debit agreement by Purchaser
for payment of a Note Receivable.
(ccccc)
Permits. The term "Permits" shall mean all permits, consents,
approvals and authorizations issued by any
Governmental Authority for the
acquisition, construction, development,
renovation, rehabilitation, use,
operation and occupancy of the Marathon Key
Resort.
(ddddd)
Permitted Exceptions. The term "Permitted Exceptions" means
those
exceptions to and encumbrances on title to
the Marathon Key Resort which TFC has
approved on the date of this Agreement and
which are described on Schedule F
attached hereto and made a part hereof.
(eeeee)
Person. An individual, partnership, corporation, limited
liability
company, trust, unincorporated
organization, other entity, or a government or
agency or political subdivision
thereof.
(fffff)
Plans. The term "Plans" shall mean the final working drawings
and
specifications for the construction of the
Improvements, which will be prepared
by the Architect and approved by TFC from
time to time, which approval TFC
agrees not to unreasonably withhold, and as
may be modified pursuant to Section
7.2(o) hereof.
(ggggg)
Pledged Notes Receivable. Any Note Receivable related to the
Resorts which at any time has been pledged
to Agent on behalf of Lenders by
Borrower pursuant to this Agreement or any
of the Loan Documents.
(hhhhh)
Preparer. The term "Preparer" shall have the meaning ascribed
to
such term in Section 4.1(d) hereof.
(iiiii)
Prime Rate. The highest prime rate of interest from time to
time
announced or published in the Money Rates
column of the Wall Street Journal
(Eastern Edition) (the "WSJ"). In the event
that the prime rate announced or
published in the WSJ shall no longer be
available, due to the nonexistence of
the WSJ or the WSJ's failure to publish or
announce a prime rate, then the Prime
Rate shall be the highest prime rate
published by a major money center bank
selected by Agent.
(jjjjj)
Pro Rata Percentage. The term "Pro Rata Percentage" shall mean
the
applicable percentage of the Loan that each
Lender has agreed to make to
Borrower pursuant to this Agreement.
(kkkkk)
Property or Properties. The term "Property" or "Properties"
shall
mean any interest in any kind of property
or asset, whether real, personal or
mixed, tangible or intangible.
(lllll)
Purchase Price. The term "Purchase Price" shall mean the total
purchase price of a timeshare Interval, as
set forth in the Timeshare Documents
and Note Receivable relating to the
purchase of such Interval.
16
<PAGE>
(mmmmm)
Purchaser. The term "Purchaser" shall mean any Person who
purchases one or more Intervals.
(nnnnn)
Resort or Resorts (also "Eligible Resort" or "Eligible
Resorts").
Individually and collectively, as
applicable, each or all of the interval
ownership and time-share projects approved
by Agent in accordance with Sections
3.7 and 4.5 hereof and set forth in
Schedule nnnnn hereto, as may be amended
from time to time. The term "Resort" or
"Resorts" includes, among other things,
the undivided annual or (biennial)
timeshare ownership interests (Intervals) in
the respective Resorts, and the appurtenant
exclusive rights to use Units in one
or more buildings or phases and all
appurtenant or related properties,
amenities, facilities, equipment,
appliances, fixtures, easements, licenses,
rights and interests, including without
limitation, the Common Elements, as
established by and more fully defined and
described in the respective
Declarations and the other Timeshare
Documents.
(ooooo)
Intentionally Omitted.
(ppppp)
Revolving Credit Period. The term "Revolving Credit Period"
shall
mean the period commencing on the Initial
Revolving Loan Advance Date and ending
two years from the date of the Initial
Revolving Loan Advance.
(qqqqq)
Revolving Loan Advance. The term "Revolving Loan Advance" shall
mean a portion of the proceeds of the
Revolving Loan Component advanced by
Lender to Borrower in accordance with the
provisions of this Agreement, which
Advance is to be used by Borrower solely
for the purposes permitted hereunder.
(rrrrr)
Revolving Loan Component. The term "Revolving Loan Component"
shall mean that portion of the Loan in an
amount not to exceed of $30,000,000 on
the terms and conditions described in
Sections 2.2, 2.4, 2.7, 2.9 and 2.10
hereof, which amount shall be repaid as
provided in Section 2.8 hereof.
(sssss)
Revolving Loan Component Note. The term "Revolving Loan
Component
Note" shall mean that certain Note or
Notes, in the form attached hereto and
made a part hereof as Exhibit N, dated the
date hereof, and executed and
delivered by Borrower to Agent, as agent on
behalf of each Lender evidencing the
Revolving Loan Component.
(ttttt)
Revolving Loan Maturity Date. The term "Revolving Loan Maturity
Date" shall have the meaning ascribed to
such term in Section 2.8(c) hereof.
(uuuuu)
Intentionally Omitted.
(vvvvv)
Security. The term "Security" shall have the same meaning as in
Section 2(1) of the Securities Act of 1933,
as amended.
(wwwww)
Servicing Agent. Agent's exclusive agent, which shall be such
Person or Persons designated by Borrower
and approved by Agent in its sole
discretion, for the purposes of billing and
collecting amounts due on account of
the Pledged Notes Receivable, providing
reports pursuant to the Servicing
Agreement and performing other servicing
functions not performed by the Lockbox
Agent. Bluegreen Corporation shall be the
Servicing Agent until an
17
<PAGE>
Event of Default shall have occurred and
Agent replaces Bluegreen Corporation as
Servicing Agent as provided in Section
10.14.
(xxxxx)
Servicing Agreement. The term "Servicing Agreement" shall mean
the
agreement by and among Bluegreen Vacations
Unlimited, Inc., Bluegreen
Corporation and Agent on behalf of the
Lenders, in form and substance acceptable
to TFC in its reasonable discretion, for
the purposes of billing and collecting
on amounts due on account of the Pledged
Notes Receivable, as the same may be
modified from time to time with TFC's prior
written consent, which consent TFC
shall not unreasonably withhold.
(yyyyy)
Submissions. The term "Submissions" shall have the meaning
ascribed to such term in Section 4.1(d)
hereof.
(zzzzz)
Intentionally Omitted.
(aaaaaa)
Summary of Weekly Advances. The term "Summary of Weekly
Advances"
shall have the meaning ascribed to such
term in Section 2.5(b) hereof.
(bbbbbb)
Survey. The term "Survey" means a survey of each Resort,
satisfactory to Borrower and TFC and
prepared by a surveyor reasonably
satisfactory to TFC and the Title Company
(as hereafter defined), which survey
shall show, among other things which may be
reasonably requested by TFC or the
Title Company, the location and dimensions
of all improvements, including the
Units, common elements and other buildings
and improvements and shall indicate
the routes of ingress and egress for public
access to the Resort in question,
all utility lines, walks, drives, building
and setback lines, distances of the
all buildings and improvements from the
building, setback and property boundary
lines, recorded or visible easements and
rights-of-way on the applicable Resort,
and showing that there are no
encroachments, improvements, projections, or
easements (recorded or unrecorded) on the
property lines. The Survey shall
certify the acreage of the Resort, the
location and number of parking spaces,
the height and square footage of the
improvements thereon and shall indicate the
zoning designation for the Resort and
whether the Resort is located within any
flood hazard area. The Survey must be
prepared in accordance with the standards
set forth by ALTA/ACSM and those of any and
all surveyors' bureaus or
associations of the jurisdiction in which
the Resort is located as well as any
and all applicable laws and must be
certified to TFC, Borrower and the Title
Company. The surveyor's certificate placed
on the Survey shall be in form and
substance reasonably acceptable to the TFC
and shall include a statement that
the Survey locates any and all items set
forth as exceptions in the Title Policy
as TFC may reasonably require. The survey
shall include a legal description of
the Resort by metes and bounds, and
otherwise satisfy all of TFC's survey
requirements, and shall include any other
information reasonably required by TFC
or the Title Company.
(cccccc)
Tangible Net Worth. The term "Tangible Net Worth" means, with
respect to any Person, the amount
calculated in accordance with GAAP as: (i) the
consolidated net worth of such Person and
its consolidated subsidiaries, plus
(ii) to the extent not otherwise included
in such consolidated net worth,
unsecured subordinated debt of such Person
and its consolidated subsidiaries,
the terms and conditions of which are
reasonably satisfactory to TFC, minus
(iii) the consolidated intangibles of such
Person and its consolidated
subsidiaries, including, without
18
<PAGE>
limitation, goodwill, trademarks,
tradenames, copyrights, patents, patent
allocations, licenses and rights in any of
the foregoing and other items treated
as intangible in accordance with GAAP.
(dddddd)
Term. The term "Term" shall mean, as the case may be, the
Acquisition/Construction Loan Component
Term or the Revolving Loan Component
Term.
(eeeeee)
Timeshare Act. The term "Timeshare Act" shall mean any statute,
act, regulation, ordinance, rule or law
applicable to the establishment and
operation of the Resorts and the sales of
the Intervals.
(ffffff)
Timeshare Documents. The term "Timeshare Documents" shall mean
any registration statement required under
any Timeshare Act approving the
establishment and operation of the Resorts
and the sales of Intervals, as well
as the Declaration and all other documents
related to the creation and operation
of the Resort.
(gggggg)
Timeshare Interest. A timeshare estate comprised of a right to
use and occupy a Unit for a certain period
of time each year or every other year
in perpetuity coupled with a fee estate or
an estate for years acquired pursuant
to an Owner Beneficiary Agreement, which
the Purchaser thereof directs Bluegreen
Vacations Unlimited, Inc. to immediately
convey to the Trustee and the Trustee
holds such timeshare estate pursuant to the
Trust Agreement, at which time, the
Purchaser becomes a member and an Owner
Beneficiary of the Vacation Club, is
identified in a schedule attached to the
Trust Agreement, amended from time to
time to include each new Owner Beneficiary,
and is entitled to certain Owner
Beneficiary Rights under the Trust
Agreement and a specific number of Vacation
Points corresponding to such rights, which
Vacation Points may be used by the
Owner Beneficiary for lodging for varying
lengths of time at the various Resorts
within the Vacation Club.
(hhhhhh)
Timeshare Owners' Association. The term "Timeshare Owners'
Association" shall mean, with respect to
each Resort, the applicable
not-for-profit corporations described on
Schedule H, attached hereto and made a
part hereof, as the same may be amended
from time to time
(iiiiii)
Title Company. The term "Title Company" shall mean any title
company reasonably acceptable to TFC which
issues the Title Policy and any
mortgage title policy.
(jjjjjj)
Title Policy. The term "Title Policy" means an ALTA extended
coverage lender's title insurance policy
issued by the Title Company in the
amount of Eleven Million Eight Hundred
Thousand Dollars ($11,800,000.00)
insuring that the Marathon Key Resort
Mortgage constitutes a valid first
priority lien covering the Marathon Key
Resort, without exception for mechanics'
liens or for matters that an accurate
survey would disclose, subject only to the
Permitted Exceptions, and issued by the
Title Company in favor of Agent, as
agent for each Lender. The Title Policy
shall contain, to the extent available,
such affirmative coverage as TFC deems
reasonably necessary, including but not
limited to an affirmative statement that
the Title Policy insures Agent, as
agent for each Lender, together with their
respective successors and assigns,
against all mechanics' and materialmen's
liens arising from or out of completion
of the Work (as hereafter defined) at
Marathon Key Resort and shall contain such
endorsements as TFC may reasonably request,
in form and content acceptable to
TFC including, without
19
<PAGE>
limitation, the following endorsements: (A)
an endorsement insuring against
matters that would be disclosed by an
accurate survey of the property; (B) an
endorsement insuring that no building
restriction or similar exception to title
disclosed on the Title Policy has been
violated and that any violation thereof
would not create or result in any
reversion, reverter, or forfeiture of title;
(C) an endorsement insuring over any
environmental superlien or similar lien on
all or any portion of the property; (D)
variable rate endorsement; (E) land same
as survey endorsement; (F) ALTA 9
endorsement; (G) an endorsement that all
separate parcels comprising the property
are contiguous and that the property
(or each parcel thereof) constitutes a
separate tax lot; and (H) pending
disbursements endorsement.
(kkkkkk) Total
Acquisition Costs. The term "Total Acquisition Costs" shall
mean all costs, fees and expenses incurred
in connection with the acquisition of
the Marathon Key Resort as approved by TFC
in writing and as set forth in the
Approved Budget.
(llllll)
Total Construction Costs. The term "Total Construction Costs"
shall mean all costs, fees and expenses
incurred in connection with the
construction, development, renovation and
rehabilitation of all Improvements at
the Marathon Key Resort, as approved by TFC
in writing and as set forth in the
Approved Budget.
(mmmmmm)
Intentionally Omitted.
(nnnnnn)
Transfer Account. The term "Transfer Account" shall mean the
account established by Agent, as described
in Schedule I attached hereto and
made a part hereof, as the same may be
amended from time to time, to which all
Loans by Lenders will be made.
(oooooo)
Trust Agreement. That certain Bluegreen Vacation Club Amended
and
Restated Trust Agreement, dated as of May
18, 1994, by and among Bluegreen
Vacations Unlimited, Inc., the Trustee, the
Bluegreen Resorts Management, Inc.
and Bluegreen Vacation Club, Inc., as
amended, restated or otherwise modified
from time to time with prior written notice
of any material amendment,
restatement or other modification to TFC,
provided, however, that no such
amendment, restatement or other
modification shall adversely affect in a
material manner the Collateral, together
with all other agreements, documents
and instruments governing the operation of
the Vacation Club.
(pppppp)
Trustee. Vacation Trust, Inc., a Florida corporation, in its
capacity as trustee under the Trust
Agreement, and its permitted successors and
assigns.
(qqqqqq)
UCC-1 Financing Statements. The UCC-1 Financing Statements,
naming Borrower as debtor and Agent as
secured party on behalf of each Lender
filed in connection with the Loans and all
amendments thereto.
(rrrrrr)
Unit. The term "Unit" shall mean, with respect to each Resort,
one living unit in a building incorporated
into the Resort pursuant to the
applicable Declaration, together with all
related or appurtenant Common Elements
and related or appurtenant interests in
services, easements and other rights or
benefits, as described and provided for in
the Declaration, including but not
limited to the right to use the Resort
amenities and facilities in accordance
with the Timeshare Documents.
20
<PAGE>
(ssssss)
Vacation Club. Bluegreen Vacation Club Trust, doing business as
Bluegreen Vacation Club, formed pursuant to
the Trust Agreement.
(tttttt)
Vacation Points. The value placed upon a nightly or weekly
occupancy of a Unit pursuant to the terms
of an Owner Beneficiary Agreement,
which value is set forth within the Demand
Balancing Standard (as defined in the
Trust Agreement).
(uuuuuu)
Voluntary Prepayment. The term "Voluntary Prepayment" shall
mean
any voluntary prepayment of the Loan
permitted to be made by Borrower under the
terms of this Agreement.
(vvvvvv)
Work. The term "Work" shall mean the completion of the
construction, development, renovation and
rehabilitation of the Improvements at
the Marathon Key Resort as provided in the
Construction Contracts, the
Architect's Contract, the Plans and this
Agreement.
SECTION 2 -- THE LOAN
2.1
Acquisition/Construction Loan Component and Lending Limits.
(a)
Acquisition/Construction Loan. Upon the terms and subject to
the
conditions set forth in this Agreement,
from time to time, but no more
frequently than once per calendar month,
Borrower may submit an Application for
Acquisition/Construction Advance to TFC
requesting an Acquisition/Construction
Advance under the Loan for the payment of
costs and expenses incurred in
connection with the acquisition,
construction, development, renovation,
rehabilitation, refitting, furnishing and
equipping of the Marathon Key Resort
or for the payment of other costs and
expenses incident to the Loan, as
specified in the Approved Budget. Upon
submission by the Borrower to TFC of
satisfactory evidence of payment by the
Borrower of such costs and expenses, or
upon submission by the Borrower of invoices
for such costs and expenses of work,
services or materials performed, rendered
or delivered to Borrower as of the
date of such Advance, as specified in the
Approved Budget, and satisfaction of
the conditions to such Advance as provided
herein, the proceeds of such Advance
shall be paid by the Lender(s) to the
Borrower to reimburse the Borrower, or to
provide the Borrower with funds for such
payment, subject at all times to the
terms and conditions of this Agreement.
Borrower shall submit Applications for
Acquisition/Construction Advances to TFC at
least five (5) Business Days prior
to the date of the Advance in question. The
funds to be advanced shall be wired
to Bluegreen Vacations Unlimited, Inc.'s
operating account as directed in
writing by Borrower, unless TFC shall, in
its sole discretion, elect to fund
Advances through an escrow agent approved
by TFC. The first
Acquisition/Construction Advance shall be
made on the Closing Date.
Notwithstanding anything herein to the
contrary, Lenders shall not be obligated
to make more than five (5)
Acquisition/Construction Advances under any
circumstances and all such Advances must be
made on or before the Improvements
Completion Date. If any portion of the
Acquisition/Construction Loan Component
is not advanced by the Improvements
Completion Date, then Borrower shall no
longer be entitled to request, nor shall
Lenders be obligated to loan, an
advance of the Acquisition/Construction
Loan Component.
(b)
Lending Limits. Borrower acknowledges, agrees and confirms that
the
obligation of all Lenders, including TFC,
to make Acquisition/Construction Loan
Advances under this
21
<PAGE>
Agreement to the Borrower is limited to the
lesser of: (i) 75% of the aggregate
of Total Acquisition Costs and Total
Construction Costs as set forth in the
Approved Budget; or (ii) $11,800,000.00.
Borrower further acknowledges, agrees
and confirms that the obligation of each
Lender, including TFC, to make loans
hereunder to the Borrower is limited to:
(i) with respect to each
Acquisition/Construction Advance hereunder,
each Lender's Pro Rata Percentage of
any such Acquisition/Construction Advance
hereunder and (ii) with respect to all
Advances made hereunder, such Lender's
obligation hereunder shall be limited to
its Commitment as set forth on Schedule A-1
hereto, as hereafter amended from
time to time. Notwithstanding anything
herein to the contrary, the maximum
outstanding principal balance of the Loans,
including the outstanding principal
balances of the Acquisition/Construction
Loan Component and the Revolving Loan
Component, shall not exceed $30,000,000 in
the aggregate at any time (the
"Maximum Loan Amount").
(c)
Expenditures in Excess of the Approved Budget. No Lender shall
be
required to make any
Acquisition/Construction Loan Advance so long as there
remains any outstanding amounts due which
constitute amounts expended in excess
of the Approved Budget or any scheduled
draw or Advance thereunder.
(d)
Limitations on Acquisition/Construction Loan Advances.
Acquisition/
Construction Advances for Total
Construction Costs shall be limited to direct
payment or reimbursement for work in place
and materials delivered up to the
amounts shown in corresponding line items
in the Approved Budget.
2.2
Revolving Loan Component and Lending Limits.
(a)
Revolving Loan Component. Upon the terms and subject to the
conditions
set forth in this Agreement, each Lender
agrees severally, at any time and from
time to time during the Revolving Credit
Period, to make a loan or loans to
Borrower, and Borrower may borrow, repay
and reborrow during the Revolving
Credit Period only, with respect to the
Revolving Loan Component only, in an
aggregate amount not to exceed at any time
the lesser of: (i) each Lender's Pro
Rata Percentage of the amount of the
Borrowing Base or (ii) the lending limits
set forth in section 2.2(b) hereof.
(b)
Lending Limits. Borrower acknowledges, agrees and confirms that
the
obligations of all Lenders, including TFC,
to make Loans under this Agreement to
Borrower is limited to the lesser of: (i)
the Borrowing Base or (ii) $30,000,000
(the "Maximum Available Revolving Amount").
Borrower further acknowledges,
agrees and confirms that the obligation of
each Lender, including TFC, to make
loans hereunder to Borrower is limited to:
(i) with respect to each Revolving
Loan Advance hereunder, each Lender's Pro
Rata Percentage of any such Advance
hereunder and (ii) with respect to all
Revolving Loan Advances made hereunder,
such Lender's obligation hereunder shall be
limited to its Commitment as set
forth on Schedule A-2 hereto.
Notwithstanding anything herein to the contrary,
the maximum outstanding principal balance
of the Loans, including the
outstanding principal balances of the
Acquisition/Construction Loan Component
and the Revolving Loan Component, shall not
exceed the Maximum Loan Amount at
any time.
22
<PAGE>
(c)
Revolving Loan Advance. Notwithstanding anything herein to the
contrary, the Revolving Loan Advances shall
commence on the Initial Revolving
Loan Advance Date, provided that Advances
under the Revolving Loan Component
with respect to Eligible Notes Receivable
generated from the sale of Intervals
at the Marathon Key Resort shall commence
no later than July 1, 2004.
2.3 Making
of Loans. Each Loan under this Agreement by a Lender shall be
made ratably in accordance with each
Lender's respective Pro Rata Percentage,
provided, however, that the failure of any
Lender to make any required Loan
shall not in itself relieve any other
Lender of its obligation to make any
required Loan hereunder. Likewise, no
Lender, including TFC, shall be
responsible or liable for the failure of
any other Lender to make any Loan
required to be made by such other Lender,
nor shall any Lender, including TFC,
be obligated to make any Loan or Loans in
excess of its respective Pro Rata
Percentage, but not in excess of its
Commitment, in the event that any other
Lender fails or refuses to make a Loan or
Loans as provided hereunder, provided,
however, that if any other Lender shall
fail to make its Pro Rata Percentage of
any Loan or Loans, TFC will be responsible
for funding up to, but not in excess
of a total of $30,000,000. As and when
additional Lenders, other than TFC,
execute and deliver this Agreement, then
(A) such additional Lenders shall be
deemed to have simultaneously purchased
from each of the other Lenders which has
previously executed and delivered this
Agreement, a share in such other Lenders'
Loans so that the amount of the Loans of
all Lenders shall be pro rata as
otherwise set forth above and (B) such
other adjustments shall be made from time
to time as shall be equitable to insure
that the Advances to Borrower are made
ratably by each Lender in accordance with
its respective Pro Rata Percentage.
Nothing herein shall be deemed to relieve
any Lender from its obligations
hereunder or to prejudice any rights TFC
may have against any Lender as a result
of any Lender's failure to make any Loan or
Loans as provided herein.
2.4 Note
Evidencing Borrower's Obligations. Borrower's obligations to
pay
the principal of and interest on: (i) the
Loan or Loans made by each Lender
under the Revolving Loan Component shall be
evidenced by the Revolving Loan
Component Note and (ii) the Loan or Loans
made by each Lender under the
Acquisition/Construction Loan Component
shall be evidenced by the
Acquisition/Construction Loan Component
Note. Each Note to Agent, as agent for
each Lender, shall be dated as of the date
hereof and be in the stated principal
amount of the respective loan component.
Each Note will mature on its respective
maturity date, bear interest as provided in
Section 2.7 hereof and be otherwise
entitled to the benefits of this Agreement.
Notwithstanding the stated principal
amount of either Note, the aggregate
outstanding principal amount of the Loan at
any time shall be the aggregate principal
amount owing on each Note at such
time. Agent shall and is hereby authorized
to record on any grid attached to
each Note (or, alternatively, in its
internal books and records) the date and
amount of each Advance made by Lenders, the
interest rate and interest period
applicable thereto and each repayment
thereof; and such grid or other books and
records shall, as between Borrower and each
Lender, absent manifest error,
constitute prima facie evidence of the
accuracy of the information contained
therein. Failure by Agent to so record any
Advance made by Lenders (or any error
in such recordation) or any payment thereon
shall not affect the Obligations of
Borrower under this Agreement or under the
Notes and shall not adversely affect
Lender's rights under this Agreement with
respect to the repayment thereof. At
the election of any Lender, Borrower shall
execute and deliver to such Lender, a
Note in a stated principal amount equal to
such Lender's Pro Rata Percentage of
the Loan, which such Note or Notes shall be
on the same terms and
23
<PAGE>
conditions as provided above and which Note
or Notes shall be included within
the definition of "Note" as such term is
used herein. If the delivery of any
such Note is required in connection with an
increase, modification, or extension
of the Revolving Credit Period, the Maximum
Loan Amount, the
Acquisition/Construction Loan Maturity
Date, the Revolving Loan Maturity Date or
the amount of the Loan or any other
modification to this Agreement, then
delivery of such Note shall be at the sole
expense of Borrower. Otherwise,
delivery of such Note shall be at the sole
expense of the Lender requesting the
Note.
2.5 Notice of
Advances.
(a) Upon
receipt by TFC from Borrower of a written request for an
Advance
in accordance with Section 5 hereof and
Borrower's satisfaction of the
requirements set forth in Section 5 hereof,
TFC shall give a written notice (a
"Notice of Borrowing") to each Lender,
(which Notice of Borrowing shall be given
to each Lender not less than one (1)
business day prior to the date of the
proposed Advance) in the form attached
hereto as Exhibit O setting forth: (i)
the total amount of the Advance requested
by Borrower and whether it is a
request for an Advance under the
Acquisition/Construction Loan Component or
under the Revolving Loan Component; (ii)
the aggregate amount of all Loans
previously made by each respective Lender;
(iii) the outstanding principal
balance of the Revolving Loan Component;
(iv) the outstanding principal balance
of the Acquisition/Construction Loan
Component; (v) the current applicable
Interest Rate as determined in accordance
with Section 2.7 hereof; (vi) each
such Lender's Pro Rata Percentage of the
requested Advance and (vii) the date on
which such Advance is to be made;
or, at the option of the Agent:
(b) Agent
shall provide to each Lender: (A) each month by the close of
business on the fifth (5th) business day
following receipt by TFC from Borrower,
but in no event later than the 30th day of
the month: (i) an updated borrowing
base report (a "Borrowing Base Report") in
the form attached as Exhibit P; and
(ii) an updated trial balance and aging
report for the Pledged Notes Receivable
(a "Collateral Data Report"); and (B) by
the close of business on the tenth
(10th) business day following receipt by
TFC from Borrower of the documents
described in Section 2.5(b)(A) above, (i) a
summary of all Advances made by TFC
during the immediately preceding month (a
"Summary of Weekly Advances"); and
(ii) a summary report of Advances and
repayments or collections for the
immediately preceding month and a
calculation of the amount of the Advance
required of such Lender (a "Lender Advance
Report").
2.6
Disbursement of Funds.
(a) If
notice of Advances is provided in accordance with Section
2.5(a)
above, then after receiving a Notice of
Borrowing from TFC, each Lender shall,
not later than 11:00 a.m., Eastern Standard
Time, on the date specified in such
Notice of Borrowing on which the proposed
Advance is to be made, wire transfer
to Agent at the Transfer Account, in
immediately available funds, an amount
equal to each such Lender's Pro Rata
Percentage of the proposed Advance as set
forth in the Notice of Borrowing. Upon
Agent's receipt of funds from each Lender
equal to the amount of the requested
Advance, and subject to Borrower's
compliance with the terms and conditions of
this Agreement, Agent shall disburse
the Advance to Borrower by wire transfer
of
24
<PAGE>
funds as directed in writing by Borrower.
If Agent shall not receive funds from
any Lender as set forth above, then,
subject to Section 2.3 hereof, the amount
of the Advance in question shall be
automatically reduced by an amount equal to
the missing Lender's Pro Rata Percentage of
the Advance in question, and Agent
shall, subject to Borrower's compliance
with the terms and conditions of this
Agreement, disburse the Advance in the
reduced amount to Borrower by wire
transfer of funds as directed in writing by
Borrower. TFC, in its sole and
absolute discretion, may (but shall not be
obligated to) make the full amount of
the requested Advance available to Borrower
prior to the receipt by Agent from
one or more Lenders of funds representing
such Lender's or Lenders' Pro Rata
Percentage of the Advance in question,
subject to Section 2.3 hereof. If the
funds representing such Lender's or
Lenders' Pro Rata Percentage of the Advance
in question are not received by Agent
within two business days of the date of
such Advance, Borrower shall immediately,
upon demand of TFC, repay such amount
to Agent. Nothing herein shall be deemed to
relieve any Lender from its
obligations hereunder or to prejudice any
rights TFC may have against any Lender
as a result of any Lender's failure to make
any Loan or Loans as provided
herein; or
(b) If
Agent shall, at its sole and absolute discretion, elect to fund
periodic Advances on behalf of each of the
Lenders, and in such event notice of
Advances is provided in accordance with
Section 2.5(b) above, then by the close
of business on the third (3rd) business day
following such Lender's receipt of
the Lender Advance Report, such Lender
shall wire transfer to Agent at the
Transfer Account, in immediately available
funds, the net amount due from such
Lender as set forth in the Lender Advance
Report. If the funds representing such
Lender's amount of the Advance or Advances
in question are not received by Agent
within five (5) business days of the date
of such Lender's receipt of the Lender
Advance Report, Borrower shall immediately,
upon demand of TFC, repay such
amount to Agent. Nothing herein shall be
deemed to relieve any Lender from its
obligations hereunder or to prejudice any
rights TFC may have against any Lender
as a result of any Lender's failure to make
any Loan or Loans as provided
herein.
2.7
Interest Rate. From and after the Closing Date, (i) with respect
to
the Revolving Loan Component, including
each Loan hereafter made pursuant to
Section 2.2(a) hereof, the Revolving Loan
Component shall bear interest at the
Revolving Loan Component Interest Rate and
(ii) with respect to the
Acquisition/Construction Loan Component,
including each Loan hereafter made
pursuant to Section 2.1(a) hereof, the
Acquisition/Construction Loan Component
shall bear interest at the
Acquisition/Construction Loan Component Interest
Rate. Immediately upon the occurrence of an
Event of Default and after the
respective maturity date (if the Loan is
not paid in full on the respective
maturity date), at TFC's election, in its
sole discretion, the entire Loan will
bear interest at the Default Rate.
2.8
Payments. Borrower agrees punctually to pay or cause to be paid
to
Agent, as agent for each Lender, all
principal and interest due under each Note
in respect of the Loans. Borrower shall
make the following payments on the
Loans:
(a)
Monthly Payments.
(1)
Revolving Loan Component. Borrower shall direct or otherwise cause
all
makers of all Pledged Notes Receivable to
pay all monies due thereunder to the
lockbox established pursuant to the Lockbox
Agreement, or as otherwise required
by TFC. One hundred percent
25
<PAGE>
(100%) of the cleared funds collected from
the Pledged Notes Receivable each
week will be paid to Agent by the Lockbox
Agent pursuant to the Lockbox
Agreement, and will be applied by Agent
first to the payment of costs or
expenses incurred by TFC pursuant to this
Agreement in creating, maintaining,
protecting or enforcing the Liens in and to
the Collateral and in collecting any
amounts due to any Lender in connection
with the Loan ("Collection Costs") and
the balance to each Lender in accordance
with the applicable percentage of the
outstanding principal balance of the Loan
that each Lender has made (the "Pro
Rata Payment Percentage") as provided in
Section 2.8(d) hereof. Each Lender
shall apply the balance of each such
payment in the following order: (i) to any
interest accrued at the applicable Default
Rate, (ii) to the payment of accrued
and unpaid interest at the Revolving Loan
Component Interest Rate, and (iii) to
the reduction of the principal balance of
such Lender's outstanding Loans. In
the event that the cleared funds received
by Agent are insufficient to pay the
amounts described in aforementioned clauses
(i)-(ii), then Agent shall provide
Borrower with written notice of such
insufficiency and Borrower shall pay the
insufficiency to Agent within five (5) days
of the date of such written notice.
In the event Borrower receives any payments
on any of the Pledged Notes
Receivable directly from or on behalf of
the maker or makers thereof, Borrower
shall receive all such payments in trust
for the sole and exclusive benefit of
Lenders; and Borrower shall deliver to the
Lockbox Agent all such payments (in
the form so received by Borrower) as and
when received by Borrower within one
(1) Business Day of receipt thereof, unless
a Default or an Event of Default has
occurred and TFC shall have notified
Borrower to deliver directly to Agent all
payments in respect of the Pledged Notes
Receivable which may be received by
Borrower, in which event all such payments
(in the form received) shall be
endorsed by Borrower to Agent as agent for
Lenders and delivered to Agent by
Borrower within one (1) Business Day of
receipt thereof; and
(2)
Acquisition/Construction Loan Component. Borrower shall pay to
Agent
on or before the tenth day of each month an
amount equal to: (i) any Collection
Costs; (ii) all interest accrued at the
applicable Default Rate on the
Acquisition/Construction Loan Component;
and (iii) all interest due and payable
as of the last day of the immediately
preceding month on the outstanding
principal balance of the
Acquisition/Construction Loan Component at the
Acquisition/Construction Loan Interest
Rate. In the event that Borrower fails to
make the payment in question, Agent may, at
its option, on or before the tenth
day of each month, make an Advance with
respect to the Revolving Loan Component
and apply such Advance to the payment of
amounts due in respect of the
Acquisition/Construction Loan Component as
provided immediately above.
(b)
Semi-Annual Principal Payments. Borrower agrees to repay the
Acquisition/Construction Loan Component by
making the following minimum
semi-annual principal repayments (inclusive
of any release payments as described
in Section 2.16 hereof):
Semi-Annual
Cumulative
-----------
----------
On or before September 15, 2004: $
1,475,000 $
1,475,000
On or before December 15, 2004:
$ 3,441,666 $
4,916,666
On or before June 15, 2005:
$ 3,441,667 $
8,358,333
On or before September 15, 2005: $
3,441,667
$11,800,000
26
<PAGE>
Such
semi-annual payments will be applied by each Lender as follows:
(i)
first to interest at the applicable Default
Rate; (ii) then to interest at the
Acquisition/Construction Loan Interest
Rate; (iii) then to the reduction of
principal of the Acquisition/Construction
Loan Component.
(c) Final
Payment. Unless sooner due as a result of acceleration or
otherwise, the entire outstanding principal
amount of the Loan, together with
all other Obligations hereunder, shall be
due and payable on the respective
maturity dates as follows: (i) the
Acquisition/Construction Loan Component shall
be due and payable in full, with all
accrued and unpaid interest thereon, on the
earlier of: (y) Sale of 85% of all
Intervals at the Marathon Key Resort; or (z)
the Acquisition/Construction Loan Maturity
Date; and (ii) the Revolving Loan
Component shall be due and payable in full,
with all accrued and unpaid interest
thereon, on March 31, 2009 (the "Revolving
Loan Maturity Date").
(d)
Payments to Lenders. Promptly upon receipt by Agent of any
payment
from Borrower in accordance with this
Sections 2.8, 2.9 and 2.16, and after
payment of any Collection Costs, Agent
shall promptly wire transfer to each
Lender as described in Schedules A-1 and
A-2 hereto, in immediately available
funds, each such Lender's Pro Rata
Percentage of the payment in question.
2.9
Prepayments.
(a)
Voluntary Prepayments.
(i)
Subject to the minimum usage requirement described in Section
2.10
below, during the Revolving Credit Period
partial prepayments of the Revolving
Loan Component will only be allowed upon
thirty (30) days prior written notice
to TFC, without penalty, solely as a result
of the sale of the Pledged Notes
Receivable into a securitization and/or
true-sale financing program arranged by
the Borrower, or into a term/conduit
facility arranged by TFC. After any such
sale, the Borrower shall cause a minimum of
$1,000,000 to remain outstanding
under the Loan for the term thereof.
(ii)
Subject to the minimum usage requirements described in Section
2.10
below, Borrower may prepay the
Acquisition/Construction Loan Component, in whole
or in part, at any time, without penalty or
premium.
(iii) Upon
expiration of the Revolving Credit Period, prepayment of the
Revolving Loan Component will be allowed,
in whole or in part, upon thirty (30)
days prior written notice to TFC and the
payment of a prepayment premium as
provided in Section 2.9(c)(i) hereof.
(b)
Mandatory Prepayments. If at any time and for any reason: (i)
the
outstanding unpaid principal balance of the
Revolving Loan Component shall
exceed the Maximum Available Revolving
Amount; (ii) the outstanding unpaid
principal balance of the Revolving Loan
Component divided by the aggregate
outstanding principal balance of all
Eligible Notes Receivable pledged to Agent
hereunder shall exceed the Borrowing Base;
or (iii) the outstanding unpaid
principal balance of both the Revolving
Loan Component and the
Acquisition/Construction Loan Component
shall exceed the Maximum Loan Amount
(each an "Excess Funding") then, within
five (5) Business Days following the
date of written notice from TFC of the
occurrence of such excess or, absent such
notice, within fifteen (15) days after
the
27
<PAGE>
end of the calendar month in which such
excess occurred: (x) in the case of an
Excess Funding described in (i) or (ii)
above, Borrower shall promptly repay the
principal balance of the Revolving Loan
Component in an amount equal to such
Excess Funding or (y) in the case of an
Excess Funding described in (iii) above,
Borrower shall prepay the principal balance
of the Acquisition/Construction Loan
Component (and if necessary the Revolving
Loan Component) in an amount equal to
such Excess Funding. If TFC has determined
that Notes Receivable have been
delivered to Agent and were included in the
Borrowing Base, which Notes
Receivable did not or no longer qualify as
Eligible Notes Receivable
("Ineligible Notes Receivable"), Borrower
shall substitute Eligible Notes
Receivable for such Ineligible Notes
Receivable and thereby increase the
aggregate principal amount of Eligible
Notes Receivable pledged to Agent as
agent for Lenders so that Excess Funding is
eliminated. The pledge and delivery
to Agent as agent for Lenders of additional
Eligible Notes Receivable shall
comply with the document delivery and
recordation requirements set forth in
Section 5.1 of this Agreement and shall be
accompanied by a written
certification of Borrower to the effect
that such additional Pledged Notes
Receivable are Eligible Notes Receivable,
and that, giving effect to the pledge
to Agent as agent for Lenders of such
Eligible Notes Receivable, the outstanding
unpaid principal balance of the Revolving
Loan Component divided by the
aggregate outstanding principal balance of
all Eligible Notes Receivable pledged
to Agent hereunder is equal to or less than
the Borrowing Base If Borrower
elects to prepay the excess principal
balance of the Loan pursuant to this
Section 2.9(b), no prepayment premium shall
be payable in connection with such
prepayment.
(c)
Premiums. Except as provided in Section 2.10 hereof, no
prepayment
premium shall be required in connection
with: (x) any voluntary prepayment made
in accordance with Section 2.8(b), Section
2.9(a)(i), Section 2.9(a)(ii) and
Section 2.9(b); or (y) in connection with
any prepayment of the principal
balance of the Loan which arises from the
prepayment of one or more Eligible
Notes Receivable by its maker or makers.
Except as heretofore set forth,
Borrower shall, in connection with a
prepayment, pay to the Agent on behalf of
the Lenders a prepayment premium as
follows:
(i) Any
prepayment of the Loan pursuant to Section 2.9(a)(iii)
above must be accompanied by a prepayment premium,
calculated as of the date immediately prior to such
prepayment, equal to one half of one percent (.50%) of the
amount prepaid.
(ii)
Notwithstanding anything herein contained to the contrary,
any prepayment under this Section 2.9 must include all
accrued but unpaid interest, and accrued but unpaid
contributions, taxes, insurance, loan charges (including
Minimum Loan Usage Fees, if any), custodial fees,
attorneys' and paralegals' fees and expenses, and other
fees or expenses incurred by TFC or Lender or advanced to
or on behalf of Borrower by TFC or any Lender pursuant to
any of the Loan Documents accrued but unpaid.
2.10
Minimum Loan Usage Fee. In addition to the interest payable
pursuant
to this Agreement, during the Revolving
Credit Period, Borrower shall pay to
Agent as agent for the Lenders with respect
to each six month period commencing
on the Initial Revolving Loan Advance Date
and with respect to each six month
period thereafter during the Revolving
Credit Period, on the
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fifth day after every such six month
period, in arrears, a fee (the "Minimum
Loan Usage Fee") equal to the product of:
(a) the excess, if any of (i)
$10,000,000.00 over (ii) the average daily
outstanding principal balance of the
Loan for such six month period; times (b)
one percent (1.00%) per annum.
2.11
Capital Adequacy Events, Etc. If TFC shall have determined that
the
applicability of any law, rule, regulation
or guideline adopted pursuant to or
arising out of law, rule, regulation or
guideline (including, but not limited
to, any United States law, rule, regulation
or guideline) regarding capital
adequacy, or any change becoming effective
in any of the foregoing or in the
enforcement or interpretation or
administration of any of the foregoing by any
court or any domestic or foreign
governmental authority, central bank or
comparable agency charged with the
enforcement or interpretation or
administration thereof, or compliance by
any Lender, with any request or
directive regarding capital adequacy
(whether or not having the force of law) of
any such authority, central bank or
comparable agency, has or would have the
effect of reducing the rate of return on
the capital of any Lender or any
Lender's holding company, as the case may
be, to a level below that which any
Lender or its holding company, as the case
may be, could have achieved but for
such applicability, adoption, change or
compliance (taking into consideration
each Lender's or its holding company's, as
the case may be, policies with
respect to capital adequacy) (the foregoing
being hereinafter referred to as
"Capital Adequacy Events"), then, upon
demand by TFC, Borrower shall pay to
Agent on behalf of any such Lender, from
time to time, such additional amount or
amounts as will compensate any such Lender
for any such reduction suffered,
provided that payments by Borrower pursuant
to this Section 2.11 shall not
subject the Borrower to any prepayment
premium under Section 2.9 hereof.
2.12
Commitment Fee. Borrower and each Lender, other than Textron
Financial Corporation, acknowledge and
agree that the following Commitment Fees
shall be due and payable exclusively to TFC
for its services hereunder as
follows: (i) Acquisition/Construction Loan
Component: an amount equal to
three-quarters of one percent (.75%) of the
principal amount of the such
component or a total of $88,500, which
commitment fee has been paid in full and
(ii) Revolving Loan Component: an amount
equal to three-quarters of one percent
(.75%) of the principal amount of this
component or a total of $225,000, which
shall be due and payable as follows: (a)
$25,000 which amount has been paid by
Borrower; (b) $125,000 due on the Initial
Revolving Loan Advance Date, but in no
event later than three (3) months from the
Closing Date, and (c) $75,000 due on
the earlier of 6 months from the Closing
Date or when the aggregate Revolving
Loan Advances total $20,000,000.00. Subject
only to the foregoing condition,
Borrower and each Lender, other than
Textron Financial Corporation, agree that
Agent has earned the entire Commitment Fee,
notwithstanding whether a closing
occurs under this Agreement or whether the
Loan or any portion thereof is
funded.
2.13 Pro
Rata Treatment. Each repayment of principal and interest on the
Revolving Loan Component and
Acquisition/Construction Loan Component shall be
allocated among Lenders in accordance with
their respective Pro Rata Payment
Percentage. Each Lender agrees that in
computing such Lender's portion of any
Advance to be made hereunder, TFC may, in
its discretion, round each Lender's
such Advance to the next higher or lower
whole dollar amount. If any Lender
shall, through the exercise of a right of
banker's lien, set-off, counterclaim
or otherwise, obtain payment with respect
to its Loans which results in its
receiving more than its
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Pro Rata Payment Percentage of any payments
described above, then (A) such
Lender shall be deemed to have
simultaneously purchased from each of the other
Lenders a share in such other Lender's
Loans so that the amount of the Loans of
all Lenders shall be pro rata as otherwise
set forth above, (B) such Lender
shall immediately pay to the other Lenders
their Pro Rata Payment Percentage of
the payments otherwise received as
consideration for such purchase and (C) such
other adjustments shall be made from time
to time as shall be equitable to
insure that all Lenders share such payments
ratably. If all or any portion of
any such excess payment is thereafter
recovered from Lender which received the
same, the purchase provided in this Section
2.13 shall be deemed to have been
rescinded to the extent of such recovery,
without interest. Borrower expressly
consents to the foregoing arrangements and
agrees that each Lender so purchasing
a portion of another Lender's loans may
exercise all rights of payment
(including all rights of set-off, banker's
lien or counterclaim) with respect to
such portion as fully as if such Lender
were the direct holder of such portion.
2.14
Suspension of Advances. In addition to any other rights that
Lenders
have hereunder, if any stay, order, cease
and desist order, injunction,
temporary restraining order or similar
judicial or nonjudicial sanction shall be
issued limiting or otherwise materially
adversely affecting any Interval sales
activities, other business operations in
respect of the Resorts, or the
enforcement of the remedies of Agent and
Lenders hereunder, then, in such event,
Agent and Lenders shall have no obligation
to make any Advances hereunder: (i)
in respect of Pledged Notes Receivable from
the sale of Intervals which are the
subject of any stay, order, cease and
desist order, injunction, temporary
restraining order or similar judicial or
nonjudicial sanction has been issued
until the stay, order, cease and desist
order, injunction, temporary restraining
order or similar judicial or nonjudicial
sanction has been lifted or released to
the satisfaction of TFC and (ii) in respect
of Pledged Notes Receivable from the
sale of Intervals at any Resort if: (x) the
stay, order, cease and desist order,
injunction, temporary restraining order or
similar judicial or nonjudicial
sanction in question has not been lifted or
released to the satisfaction of TFC
within sixty (60) days of its issuance and
(y) there is a reduction in the total
number of sales of Intervals by Borrower in
any Loan Year of more than twenty
percent (20%) from the total number of
sales of Intervals in the immediately
preceding Loan Year.
2.15 Loan
Participation.
(a) TFC
shall have the right, without prior notice to Borrower or any
other Lender or Borrower's or any other
Lender's approval, to designate one or
more Participants or Lenders and to sell or
grant to such Participants or
Lenders participation or co-lender
interests in the Loan, and in the respective
Loan Documents, and in the Collateral, on
terms and conditions satisfactory, in
its sole and absolute discretion, to TFC.
In the event that TFC so designates a
Participant or Lenders and sells or grants
such Participant or Lenders a
participation or co-lender interest in the
Loan, such Participant or Lenders
shall communicate and deal only with TFC in
respect to such Participant's or
Lenders interest in the Loan, the Loan
Documents and the Collateral, and
Borrower shall communicate and deal only
with TFC and not with any Participant
or other Lender. TFC shall provide Borrower
with prior written notice of the
identity of each Participant and/or Lender.
TFC shall use good faith efforts not
to designate one or more Participants or
Lenders which Borrower has advised TFC,
in writing, are direct and material
competitors of Borrower in the sale of
timeshare intervals and who are thus
reasonably objectionable to Borrower.
Borrower agrees to, diligently and in good
faith, cooperate with TFC
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in connection with its consummation and
administration of a written
participation or loan agreement or
agreements with one or more Participants or
Lenders or their successors and assigns,
and in complying with the terms of any
such participation or loan agreement,
including with respect to periodic
deliveries of accountings and reports with
respect to the Loan, the Loan
Documents and the Collateral. If the
designation of such Participant or Lender
results in an increase, modification, or
extension of the Revolving Credit
Period, the Maximum Loan Amount, the
Acquisition/Construction Loan Maturity
Date, the Revolving Loan Maturity Date or
the amount of the Loan or any other
modification to this Agreement, then the
designation of such Participant or
Lender shall be at the sole expense of
Borrower. Otherwise, the designation of
such Participant or Lender shall be at no
cost to Borrower.
(b) In the
event that TFC shall elect to make the entire Loan, subject to
the terms and conditions of this Section
2.15, any and all agency provisions of
this Agreement shall be disregarded and TFC
shall act solely on its own behalf
and shall hold the Collateral solely in its
own name and for its own benefit,
subject to the terms and conditions of this
Agreement.
2.16
Release Payments. Notwithstanding anything herein or in any
other
Loan Documents to the contrary, upon sale
of each Interval at the Marathon Key
Resort, Agent and each Lender agree to
release such Interval from the Lien of
the Marathon Key Resort Mortgage provided
that: (i) no Default or Event of
Default has occurred and is continuing
hereunder; (ii) the sale is a bona fide
sale to a Person other than Borrower, any
of Borrower's Agents or any Affiliate
of either Borrower, at a Purchase Price and
on such other terms and conditions
as are reasonably acceptable to TFC; and
(iii) Borrower pays to Agent a release
price equal to the greater of: (y) $4,566
per Interval to be released or (z) an
amount sufficient, as determined by TFC in
its sole discretion, such that the
Acquisition/Construction Loan Component
will be repaid in full if 85% of all
Intervals are sold at such amount (the
"Release Price"). The Release Price will
be applied to repayment of the
Acquisition/Construction Loan Component as
provided in Section 2.8 hereof. Upon
payment of the Acquisition/Construction
Loan Component in full, the Marathon Key
Resort Mortgage shall be released in
full.
SECTION 3 -- COLLATERAL
3.1 Grant
of Security Interest. (a) To secure the payment and performance
of the Obligations, for value received,
Borrower unconditionally and irrevocably
assigns, pledges and grants to Agent as
agent for each Lender a continuing first
priority security interest in and to the
Collateral and (b) for convenience of
administration, Agent is acting as agent
for the Lenders under the Agreement.
Agent, as such agent, may execute any of
its duties hereunder by or through its
agents, officers or employees and shall be
entitled to rely upon the advice of
counsel as to its duties. Agent, as such
agent, shall not be liable to the other
Lenders for any action taken or omitted to
be taken by it in good faith and
shall neither be responsible to the Lenders
for the consequences of any
oversight or error of judgment nor be
answerable to the Lenders for any loss
unless the same shall happen through
Agent's gross negligence or willful
misconduct. To the extent that Agent, as
such agent, shall not be reimbursed by
the Borrower for any costs, liabilities or
expenses incurred in such capacity,
the Lenders shall reimburse Agent therefor
pro rata in accordance with their
respective Pro Rata Percentages (including
Agent as one of the Lenders for this
purpose). Each Lender agrees that Agent
shall be entitled to take and shall only
be required to take, any action which it is
permitted to take under this
Agreement.
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Notwithstanding anything herein to the contrary, Borrower
acknowledges and
agrees as that the Revolving Loan Component
and the Acquisition/Construction
Loan Agreement shall each be secured
by:
(i) a
first priority security interest in the Eligible Notes
Receivable pledged to Agent on behalf of Lenders as
provided herein, the Mortgages with respect thereto;
(ii) the
documents, instruments, accounts, chattel paper, and
general
intangibles relating to the Pledged Notes
Receivable and the related Mortgages;
(iii) a first mortgage
lien on the Marathon Key Resort;
(iv) a first
lien in and to all equipment, furnishings,
inventory, supplies, account, chattel paper and general
intangibles at any time located at, arising out of the use
of and/or used in and the connection with the operation of
the Marathon Key Resort;
(v) an
absolute and unconditional first assignment of any and
all leases, subleases, licenses, concessions, entry fees,
or other agreements which grant a possessory interest in
and to, or the right to use all or any portion of the
Marathon Key Resort, including any Units or Intervals, and
including, but not limited to, the current Sovereignty
Submerged Lands Lease between Marathon Key Resort and
Marathon, Ltd., as lessee and the Board of Trustees of the
Internal Improvement Trust Fund of the State of Florida,
and any replacement or new such lease between Borrower and
the Board of Trustees of the Internal Improvement Trust
Fund of the State of Florida (the "Submerged Lands
Lease"), and any and all modifications or amendments
thereto;
(vi) an
absolute and unconditional first assignment of all of
the rents (excluding rents assigned to the owners
association), revenues, income, process, royalties, room
rents and charges, profits and other benefits payable for
using, leasing, licensing, possessing, operating from or
in, or otherwise enjoying all or any portion of the
Marathon Key Resort, including any Units or Intervals,
including, without limitation, damages received upon the
occurrence of a default with respect thereto;
(vii)
an absolute and
unconditional first assignment of all
other agreements to which Borrower is or becomes a party
or holds any interest therein and which in any way relate
to the acquisition, construction, development, renovation,
rehabilitation, refitting, furnishing, equipping, use,
occupancy, maintenance or enjoyment of the Marathon Key
Resort, including, but not limited to, the Architectural
Contract, the Construction Contracts and all utility
contracts, maintenance agreements and service
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contracts, and any agreement guaranteeing the performance
of the obligations contained in any of the foregoing
agreements;
(viii) a
first assignment of all marketing, sales and other
material agreements to which Borrower, any Affiliate of
either Borrower, any of Borrower's Agents or any owners
association are parties to and which pertain to the use,
occupancy, maintenance, service or enjoyment of the
Marathon Key Resort;
(ix) a security
interest in any depository accounts, and any
other account, Lockbox or post office boxes, or proceeds
thereof, associated with the Eligible Notes whereby Agent
is conferred "control" of thereof in accordance with
Section 9-104 of the Uniform Commercial Code;
(x) all
books, records, reports, computer tapes, disks and
software, to the extent assignable (not to include any
reservation system) relating to the Collateral;
(xi) all
extensions, additions, improvements, betterments,
renewals, substitutions and replacements of, for or to any
of the Collateral relating to the Marathon Key Resort
wherever located, together with the products, proceeds,
issues, rents and profits thereof, and any replacements,
additions or accessions thereto or substitutions thereof;
and
(xii) a first
assignment of all management, franchise and
license agreements for the Marathon Key Resort.
Notwithstanding the foregoing to the contrary, the
assignment of management, franchise and license agreements
for Marathon Key Resort shall be released at such time as
the Marathon Key Resort is declared a timeshare resort in
accordance with the provisions of this Agreement.
3.2
Security Interest in All Pledged Notes Receivable.
Notwithstanding
that Lenders may be obligated, subject to
the conditions of the Loan Documents,
to make Advances only in respect of
Eligible Notes Receivable pledged to Agent,
Lenders shall have a continuing security
interest in all of the Pledged Notes
Receivable, including, without limitation,
Eligible Notes Receivable that are or
may become ineligible, until any of the
same may be released by Agent, if at
all.
3.3
Financing Statements. Each Borrower agrees, at its own expense,
to
execute the financing statements,
continuation statements and amendments
provided for by the Code together with any
and all other instruments or
documents and take such other action as may
be required to perfect and to
continue the perfection of Agent's security
interest in the Collateral. Each
Borrower hereby authorizes Agent to execute
and/or file on each Borrower's
behalf any such financing statements,
continuation statements and amendments.
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3.4
Priority of Each Lender's Liens. Each Lender shall have an
equal
security interest in the Collateral based
upon its Pro Rata Percentage and no
Lender's security interest in the
Collateral shall have priority over any other
Lender's security interest in the
Collateral.
3.5
Insurance. Where insurance coverage with respect to the Resort(s)
is
provided by the Timeshare Owners'
Association, Borrower shall furnish Agent,
upon request, with satisfactory evidence
that the Units and Resorts are
adequately insured. Borrower shall furnish
to TFC evidence of insurance coverage
with respect to the Marathon Key Resort as
required herein. All such insurance
coverage shall insure against such risks,
be in such amounts, with such
companies and on such other terms as TFC
may reasonably require. Each such
policy shall name Agent as an additional
insured and loss payee as agent for
Lenders, as their respective interests may
appear. In the event of a loss or
damage to any portion of: (i) any Resort
other than the Marathon Key Resort, the
proceeds of insurance shall be applied as
provided in the applicable
Declaration, or (ii) the Marathon Key
Resort, while any portion of the
Acquisition/Construction Loan Component
remains unpaid, Agent may, in its sole
discretion, apply the proceeds of any
insurance policy to restoration and repair
of the Marathon Key Resort or to the
repayment of the Loan in accordance with
Section 2.8 hereof, provided that upon
repayment in full of the
Acquisition/Construction Loan Component,
insurance proceeds with respect to the
Marathon Key Resort shall be applied as
provided in the Declaration with respect
thereto.
3.6
Protection of Collateral; Reimbursement. So long as no Default
or
Event of Default exists, the portion of the
Collateral consisting of: (i) the
original Pledged Notes Receivable, (ii) the
original Mortgages, (iii) the
original Owner Beneficiary Agreement or
other purchase contract (including
addendum) related to such Pledged Notes
Receivable and Mortgages, (iv) the
original mortgage title policy for each
Mortgage, and (v) originals or true
copies of the related truth-in-lending
disclosure, loan application, warranty
deed, and if required by Agent, the related
Purchaser's acknowledgement receipt
and the Exchange Company application and
disclosures, shall be delivered, at
Borrower's expense to the Custodian, as
agent and bailee for Lenders, as
provided in the Custodial Agreement, and
held in the Custodian's possession and
control until the Obligations are fully
satisfied. Borrower shall pay to the
Custodian all costs, fees and expenses as
provided in the Custodial Agreement.
The portion of the Collateral delivered to
the Custodian as described above
shall be held by the Custodian as provided
in the Custodial Agreement. All
insurance expenses and all expenses of
protecting the Collateral, including
without limitation, storing, warehousing,
insuring, handling, maintaining and
shipping the Collateral, and any and all
excise, property, intangibles, sales
and use taxes imposed by any state, federal
or local authority on any of the
Collateral or in respect of the sale
thereof shall be borne and paid by
Borrower; and if Borrower fails to promptly
pay any portion thereof when due,
Agent may, at its option, but shall not be
required to, pay the same and charge
Borrower's account therefor, and Borrower
agrees promptly to reimburse Agent
therefor with interest accruing thereon
daily at the Default Rate. All sums so
paid or incurred by Agent for any of the
foregoing and any and all other sums
for which Borrower may become liable
hereunder and all costs and expenses
(including attorneys' and paralegals' fees,
legal expenses and court costs)
which Agent may incur in enforcing or
protecting its Lien on, or rights and
interest in, the Collateral or any of its
rights or remedies under this
Agreement or any other Loan Document or
with respect to any of the transactions
hereunder or thereunder, until paid by
Borrower to Agent with interest at the
Default Rate, shall be included among the
Obligations,
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and, as such, shall be secured by all of
the Collateral. Upon the occurrence of
a Default or an Event of Default or a
default by the Custodian under the
Custodial Agreement, TFC may, in its sole
discretion, replace the Custodian at
any time with a person acceptable to TFC in
its sole discretion, or elect to
hold the foregoing documents on its own
behalf.
3.7
Additional Eligible Resorts. From time to time during the Term,
Borrower may propose to TFC that one or
more time-share plans and projects owned
and operated by Borrower be included among
the Eligible Resorts in respect of
which Advances may be made. Any such
proposal will be in writing, and will be
accompanied or supported by the due
diligence and supporting Borrower, any
Affiliate of Borrower, project, financial
and related information identified in
Section 4.5 hereto, and such other
information as TFC may reasonably require.
Borrower will reasonably cooperate with
TFC's underwriting and due diligence,
and Borrower will be responsible for
payment upon billing for TFC's
out-of-pocket expenses in connection
therewith. Subject to TFC's satisfactory
underwriting and due diligence review,
including satisfaction of the conditions
in Sections 4 and 5 hereof as they relate
to such time-share resorts, TFC may,
but shall not be required to, approve one
or more such time-share resorts,
including future phases or condominiums in
an existing Eligible Resort, as an
Eligible Resort qualifying for Revolving
Loan Advances under and subject to the
terms of this Agreement and the other Loan
Documents.
Subject in
each instance to TFC's acceptable underwriting and due
diligence review and TFC's prior written
approval, any project as may be
approved by TFC after the Closing Date, if
any, is hereinafter referred to as an
"Additional Eligible Resort". Any Revolving
Loan Advances hereunder with respect
to any Additional Eligible Resort will be
subject to all terms and conditions of
this Agreement and the other Loan
Documents. Notwithstanding anything in this
Section 3.7 to the contrary, TFC may, in
its sole and absolute discretion,
require that the Lenders unanimously
consent to the approval of any project as
an Additional Eligible Resort.
As a
condition to approval of each Resort as an Eligible Resort,
Borrower
shall execute and deliver for recording a
Negative Pledge, prohibiting
assignment of the management agreements and
reservation system for each such
Resort.
3.8
Negative Pledge. Each Borrower agrees, at its own expense, to
execute
and record a Negative Pledge prohibiting
the assignment of the management
agreements and reservation systems for the
Marathon Key Resort and each Eligible
Resort.
3.9
Intentionally Omitted.
3.10
Purchaser/Criteria. All Eligible Notes Receivable pledged as
Collateral to Agent subsequent to the
Closing Date will be underwritten in a
manner consistent with the Borrower's
general underwriting criteria, as approved
in writing by TFC, in its sole discretion.
Borrower shall not materially alter
its general underwriting criteria without
the prior written approval of TFC,
which approval, TFC may withhold in its
sole discretion.
3.11
Replacement Notes Receivable. Ineligible Notes Receivable, as
such
term is defined in Section 2.9(b), shall be
replaced with Eligible Notes
Receivable, to the extent available, on a
dollar for dollar basis, provided,
however, that if Borrower is unable to
deliver
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Eligible Notes Receivable to replace any
Ineligible Notes Receivable, Borrower
shall deliver additional Notes Receivable,
if available, to Agent whether or not
such additional Notes Receivable satisfy
the criteria for Eligible Notes
Receivable. In the event that any Eligible
Note Receivable becomes available
thereafter, the Borrower shall promptly
substitute such Eligible Note Receivable
for the Ineligible Note Receivable pledged
to Agent.
SECTION 4 -- CONDITIONS PRECEDENT TO THE CLOSING
4.1
Conditions Precedent. The obligation of Agent and Lenders under
this
Agreement and the obligation to fund any
Advance, including any initial Advance,
hereunder shall be subject to the
satisfaction of each of the following
conditions precedent, in addition to all of
the conditions precedent set forth
elsewhere in the Loan Documents:
(a)
Representations, Warranties, Covenants and Agreements. The
representations and warranties contained in
the Loan Documents are and shall be
true and correct in all material respects,
and all covenants and agreements have
been complied with and are correct in all
material respects, and all covenants
and agreements to have been complied with
and performed by Borrower shall have
been fully complied with and performed to
the satisfaction of TFC.
(b) No
Prohibited Acts. Borrower shall not have taken any action or
permitted any condition to exist which
would have been prohibited by any
provision of this Agreement or the Loan
Documents.
(c) No
Changes. That all information and documents heretofore delivered
by
Borrower to TFC with respect to the Loan,
Borrower or the Existing Resorts
remain true and correct in all
respects.
(d)
Approval of Documents Prior to Closing Date. Except as
otherwise
waived in writing by TFC in its sole and
absolute discretion, Borrower has
delivered to TFC (with copies to TFC's
counsel), at least five (5) Business Days
prior to the Closing Date, and TFC has
reviewed and approved, prior to the
Closing Date, the form and content of all
of the items specified in Subsection
4.1(d)(i) through (xxvi) below (the
"Submissions"). TFC shall have the right to
review and approve any changes to the form
of any of the Submissions. If TFC
disapproves of any changes to any of the
Submissions, TFC shall have the right
to require Borrower either to cure or
correct the defect objected to by TFC or
to elect not to fund the Loan or any
Advance. Under no circumstances shall TFC's
failure to approve or disapprove a change
to any of the Submissions be deemed to
be an approval of such Submissions. All of
the Submissions were and shall be
prepared at Borrower's sole cost and
expense. TFC shall have the right of prior
approval of any Person responsible for
preparing a Submission ("Preparer") and
may disapprove any Preparer in its sole
discretion, for any reason, including
without limitation, that TFC believes that
the experience, skill, reputation or
other aspect of the Preparer is
unsatisfactory in any respect. All Submissions
required pursuant to this Agreement shall
be addressed to TFC and include the
following language: "THE UNDERSIGNED
ACKNOWLEDGES THAT TEXTRON FINANCIAL
CORPORATION AS AGENT FOR EACH LENDER IS
RELYING ON THE WITHIN INFORMATION IN
CONNECTION WITH ITS DETERMINATION TO MAKE A
LOAN TO BLUEGREEN VACATIONS
UNLIMITED, INC., IN CONNECTION WITH THE
SUBJECT COLLATERAL."
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(i) A
certificate in the form attached as Exhibit J, to be
dated as of the Closing Date and signed by the president,
vice president, or secretary of each Borrower, certifying
that the conditions specified in Sections 4.1(a), (b) and
(c) above are true;
(ii) Copies of
the articles of incorporation of each Borrower
together with any amendments thereto, currently certified
to be true and complete by each Borrower and the Secretary
of State of the States of Florida and Massachusetts, as
applicable, and a current certificate of good standing for
each Borrower, and copies of any amendments to the by-laws
of each Borrower, certified to be true, correct and
complete by the secretary or assistant secretary of each
Borrower;
(iii) A certificate of
the Secretary of each Borrower certifying
the adoption by the Board of Directors of such Borrower of
a resolution authorizing such Borrower to enter into and
execute this Agreement, the Notes and the other Loan
Documents, to borrow the Loan from Lenders, and to grant
to Lenders a first priority security interest in and to
the Collateral;
(iv) A
certificate of the secretary or assistant secretary of
each Borrower certifying the incumbency, and verifying the
authenticity of the signatures of the specified officers
of such Borrower authorized to sign the Agreement, the
Notes and the other Loan Documents;
(v)
Copies or other evidence of all loans to each Borrower
from any of Borrower's Agents or Affiliates of Borrower;
(vi) The Title
Policy;
(vii) The Survey for
the Marathon Key Resort;
(viii) The
Opinion of Counsel in the form attached as Exhibit
R-1;
(ix) Such
searches of the applicable public records as it deems
necessary under Florida law, and other applicable law to
verify that Agent has a first or second, as applicable,
and prior perfected Lien and security interest covering
all of the Collateral. Lenders shall not be obligated to
fund any Advance if TFC determines that Lenders do not
have a first or
second, as applicable, and prior perfected
lien and security interest covering any portion of the
Collateral, except as expressly provided herein;
(x) An
independent search to verify that there are no
bankruptcy, foreclosure actions or other material
litigation or judgments pending or outstanding against the
Marathon Key Resort, any portion of the Collateral, either
Borrower or any Affiliates of either Borrower (each a
"Material Party"). The term "other material litigation" as
used herein
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shall not include matters in which (i) a Material Party is
plaintiff and no counterclaim is pending or (ii) which TFC
determines in its sole discretion exercised in good faith,
are immaterial due to settlement, insurance coverage,
frivolity, or amount or nature of claim. Lenders shall not
be obligated to fund any Advance if TFC determines that
any such litigation is pending;
(xi) Title
Searches for the Marathon Key Resort, together with
legible copies of each exception or matter noted thereon;
(xii) Evidence that
Borrower is maintaining all policies of
insurance required by and in accordance with Section
7.1(d) hereof, including copies of the most current paid
insurance premium invoices;
(xiii) To
the extent available, copies of all applicable
government permits, approvals, consents, licenses and
certificates with respect to the construction,
development, renovation, rehabilitation, use, occupancy
and
operation of the Marathon Key Resort;
(xiv) Evidence
satisfactory to TFC that all taxes and
assessments owed by or for which Borrower is responsible
for collection had been paid with respect to the Marathon
Key Resort and the Collateral, including but not limited
to sales taxes, room occupancy taxes, payroll taxes,
personal property taxes, excise taxes, intangible taxes,
real property taxes and any assessments related to the
resorts or the Collateral. Copies of the most current tax
bills for the Marathon Key Resort;
(xv) Evidence
that the use and operation of the portions of
each Marathon Key Resort with all applicable zoning,
building, health, safety and fire codes and regulations;
(xvi) Evidence,
satisfactory to TFC, that Borrower has
contributed in equity at least 25% of the Total
Acquisition Costs of the Marathon Key Resort and has not
less than $450,000.00 in unrestricted available cash for
construction, development, renovation, rehabilitation,
refitting, furnishing and equipping of the Improvements;
(xvii)
Letters from all appropriate companies evidencing the
availability of all necessary utilities to the
Improvements;
(xviii) Payoff
letters and releases from all existing mortgages
encumbering the Marathon Key Resort;
(xix) To the extent
available, copies of all contracts, in form
and content acceptable to TFC, that have been executed by
and between the Contractor and a construction manager,
subcontractor, materialman, or supplier that is to provide
labor or materials in connection with the development and
construction of the Improvements in accordance with
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the Plans and Specifications with a value of $150,000.00
or more ("Material Subcontractor"), which shall contain
the agreement of the subcontractor to perform its
respective contract for TFC following the occurrence of an
Event of Default. In addition, TFC must have received a
list of all Material Subcontractors working on the
Improvements, together with copies of their respective
contracts, showing the name, address, and telephone number
of each Material Subcontractor, the work or material
performed or supplied thereby, and the total amount of
each relevant contract and subcontract and amounts paid
through the date on which such list was completed;
(xx) An
environmental report or reports covering the Marathon
Key Resort, confirming (to the extent relevant, in TFC's
reasonable discretion):
(1) The absence of Hazardous Materials on, under, or
affecting the Marathon Key Resort, except for commercially
reasonable amounts thereof commonly found at residential
and resort properties in the immediate vicinity of the
Resort;
(2) That the engineering or environmental consulting
firm has obtained, reviewed, and included within its
report a CERCLIS printout from the Environmental
Protection Agency ("EPA"), statements from the EPA and
other applicable state and local authorities, and such
other information as Borrower or TFC may reasonably
require, including, without limitation, a Phase I
Environmental Inspection, all of which information shall
confirm that there are no known or suspected Hazardous
Materials located at, used or stored on, or transported to
or from the Marathon Key Resort or in such proximity
thereto as to create a material risk of contamination,
except for commercially reasonable amounts thereof
commonly found at residential and resort properties in the
immediate vicinity of the Marathon Key Resort;
(3) The absence of radon gas at the Marathon Key
Resort, including all of the Units, or, if radon gas is
found to be present in any part of the Marathon Key Resort
or
the Units, that such presence is of a nature or
magnitude so as to be fully in compliance with applicable
standards under the Environmental Laws and all other
applicable laws or standards; and
(4) The absence of friable asbestos within the Units,
or elsewhere at the Marathon Key Resort or, if friable
asbestos is found to be present in any part of the
Marathon Key Resort, that such presence is of a nature or
magnitude that is able to be removed by a licensed removal
contractor for a guaranteed maximum sum satisfactory to
Borrower and TFC and included in the Approved Budget;
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<PAGE>
(xxi) An MAI appraisal
of the Marathon Key Resort, including but
not limited to all real and personal property located
thereon, prepared by a nationally recognized appraisal
firm and in form and content acceptable to TFC, in its
sole discretion;
(xxii) The
Financial Statements;
(xxiii) Such
credit references on each Borrower as TFC deems
necessary in its sole discretion;
(xxiv)
Evidence satisfactory to TFC that there is no material
litigation, written complaint, suit, action, written claim
or written charge pending or threatened against either
Borrower or any Affiliate of either Borrower with any
court or with any governmental authority or the Marathon
Key Resort;
(xxv) A fully executed
contract(s) evidencing the acquisition of
the Marathon Key Resort by the Borrower, and any
extensions or reinstatements thereof;
(xxvi) The
Submerged Lands Lease; and
(xxvii) Such
other documents and instruments as TFC and/or the
Title Company may reasonably request.
(e)
Execution and Delivery of Loan Documents. In addition to the
Submissions, Borrower shall have delivered
to TFC, on or before the Closing
Date, the following Loan Documents, each of
which shall be in the form of the
respective Loan Documents, shall be
executed by the appropriate party thereto,
other than Agent or any Lender, and each of
which when required, shall be in
recordable form:
(i) This
Agreement.
(ii) The
Opinion of Counsel in the form attached as Exhibit
R-1.
(iii) Revolving Loan
Component Note.
(iv)
Acquisition/Construction Loan Component Note.
(v)
Marathon Key Resort Mortgage.
(vi) Assignment
of Rents and Leases.
(vii) Assignment of
Construction Contract.
(viii)
Assignment of Architectural Contract.
(ix) Assignment
of Plans and Permits.
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<PAGE>
(x)
Environmental Indemnification Agreement.
(xi) Financing
Statements. Original UCC financing statements
covering the Collateral, filed with the Secretary of State
of Florida.
(xii) Assignment of
Management Agreement.
(xiii)
Negative Pledge.
(xiv) Other Items.
Such other agreements, documents,
instruments, certificates and materials as TFC may request
to evidence the Obligations; to evidence and perfect the
rights and Liens and security interests of Agent as agent
for Lenders contemplated by the Loan Documents, and to
effectuate the transactions contemplated herein.
In the
event that the Construction Contract and/or the Architectural
Contract have not been executed as of the
date hereof, Borrower shall deliver
copies of such contracts and the applicable
consent(s) to Agent upon execution
of the Construction Contract and/or the
Architectural Contract. TFC shall not be
obligated to fund any Advance of the
Acquisition/Construction Component after
the initial Advance of the
Acquisition/Construction Component unless and until
the executed Construction Contract,
Architectural Contract, Contractor's Consent
and the Architect's Consent each have been
delivered to TFC.
(f)
General Closing Date Conditions. On or before the Closing Date,
the
following conditions shall also be
satisfied as determined by TFC in its sole
discretion:
(i)
Agent shall have received and approved of the physical
inspection of the Marathon Key Resort conducted by TFC and
the Inspecting Architect/Engineers;
(ii) That no
Default or Event of Default has occurred or may
occur hereunder; and
(iii) That there has
been no adverse material change to the
business affairs or financial condition of either Borrower
or any material adverse change in the conditions on
properties of the Marathon Key Resort.
4.2
Closing Date Advances. In the event that Borrower desires to
have
Lenders make an Acquisition/Construction
Advance at Closing, Borrower shall also
comply with all of the requirements of
Section 5.1(a) below at least five (5)
Business Days prior to the Closing
Date.
4.3
Expenses. Borrower shall have paid all fees and expenses required
to
be paid pursuant to this Agreement. Lenders
shall have no obligation to fund any
Loan or make the initial Advance or any
subsequent Advance unless (a) the amount
of the initial Advance together with any
moneys paid by Borrower is sufficient
to satisfy all fees and expenses required
to be paid pursuant to this Agreement,
and (b) the Advance will not be used for
any of the uses set forth in Section
6.12(b).
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<PAGE>
4.4
Proceedings Satisfactory. Each Borrower shall execute all of the
Loan
Documents approved by TFC on the Closing
Date, and all actions taken in
connection with the execution or delivery
of the Loan Documents, and all
documents and papers relating thereto,
shall be satisfactory to TFC and its
counsel. TFC and its counsel shall have
received copies of such documents and
papers as TFC or such counsel may
reasonably request in connection therewith,
all in form and substance satisfactory to
TFC and its counsel.
4.5
Conditions Precedent to Funding of Advances with Respect to
Additional
Eligible Resorts. As provided in Section
3.7 hereof, Borrower may propose to TFC
that TFC approve one or more timeshare
plans for inclusion hereunder as an
Additional Eligible Resort in respect of
which Revolving Loan Advances may be
made. The obligation of Lenders to fund any
Revolving Loan Advances with respect
to an Additional Eligible Resort shall be
subject to the satisfaction of each of
the following conditions precedent, in
addition to all of the conditions
precedent set forth elsewhere in the Loan
Documents:
(a)
Representations, Warranties, Covenants and Agreements. The
representations and warranties contained in
the Loan Documents are and shall be
true and correct in all material respects,
and all covenants and agreements have
been complied with and shall be correct in
all material respects, and all
covenants and agreements to have been
complied with and performed by Borrower
shall have been fully complied with and
performed to the satisfaction of TFC.
(b) No
Prohibited Acts. Borrower shall not have taken any action or
permitted any condition to exist which
would have been prohibited by any
provision of the Loan Documents.
(c)
Approval of Documents Prior to Advance. Except as otherwise waived
in
writing by TFC in its sole and absolute
discretion, Borrower has delivered or
caused to be delivered to TFC (with copies
to TFC's counsel), at least fifteen
(15) Business Days prior to the date of
each such Advance, and TFC has reviewed
and approved, at least five (5) Business
Days prior to the date of each such
Advance, the form and content of all of the
items specified in each of the
Submissions required pursuant to this
Section 4.5. TFC shall have the right to
review and approve any changes to the form
of any of the Submissions. If TFC
disapproves of any changes to any of the
Submissions, TFC shall have the right
to require Borrower either to cure or
correct the defect objected to by TFC or
to elect on behalf of Lenders not to fund
the Loan or any Advance. Under no
circumstances shall TFC's failure to
approve or disapprove a change to any of
the Submissions be deemed to be an approval
of such Submissions. All of the
Submissions were and shall be prepared at
Borrower's sole cost and expense,
unless expressly stated to be an obligation
and expense of TFC. TFC shall have
the right of prior approval of any Preparer
and may disapprove any Preparer in
its sole discretion, for any reason,
including without limitation, that TFC
believes that the experience, skill,
reputation or other aspect of the Preparer
is unsatisfactory in any respect. All
Submissions required pursuant to this
Agreement shall be addressed to TFC and
include the following language: "THE
UNDERSIGNED ACKNOWLEDGES THAT TEXTRON
FINANCIAL CORPORATION AS AGENT FOR EACH
LENDER IS RELYING ON THE WITHIN INFORMATION
IN CONNECTION WITH ITS DETERMINATION
TO MAKE A LOAN TO BLUEGREEN VACATIONS
UNLIMITED, INC. IN CONNECTION WITH THE
SUBJECT COLLATERAL."
42
<PAGE>
(i) a certificate in the form attached as Exhibit J, to be dated
as
of the date of each such Advance and signed by the president,
vice
president, or secretary of each Borrower, certifying that the
conditions specified in Sections 4.5(a) and (b) above are true;
(ii) to the extent not previously provided, copies of the
articles
of incorporation of each Borrower, together with any amendments
thereto, currently certified to be true and complete by each
Borrower and the Secretary of State of the States of Florida
and
Massachusetts, as applicable, and a current certificate of good
standing for each Borrower issued by the Secretary of State of
the
States of Florida and Massachusetts, a current certificate of
authority to conduct business issued by the secretary of state
in
each state in which Borrower conducts business, and copies of
the
by-laws of each Borrower certified to be true, correct and
complete
by the secretary or assistant secretary of each Borrower;
(iii) a Survey for each Additional Eligible Resort for which
Eligible Notes Receivable are being pledged to Agent in
connection
with the Advance in question (an existing survey is acceptable
provided that Borrower will provide TFC with a current
surveyor's
certificate if TFC requests such certificate in connection with
the
approval of the Additional Eligible Resort);
(iv) a certificate of the secretary or assistant secretary of
each
Borrower certifying the adoption by the board of directors
thereof,
respectively, of a resolution authorizing the addition of the
Resort
in question as an Additional Eligible Resort and to authorize
each
Borrower to enter into, execute and deliver any Documents in
connection therewith;
(v) a certificate of the secretary or assistant secretary of
each
Borrower certifying the incumbency, and verifying the
authenticity
of the signatures, of the specified officers of each Borrower
authorized to sign all documents required in connection with
such
Additional Eligible Resort as required pursuant to this Section
4.5;
(vi) an inspection report or reports covering each Additional
Eligible Resort for which an inspection report has not been
previously provided and for which Eligible Notes Receivable are
being pledged to Agent in connection with the Advance in
question,
including without limitation all real property and personal
property
subject to the Declaration and all adjacent property,
confirming:
(1) the absence of Hazardous Materials on the personal
property and real property comprising each such Additional
Eligible
Resort;
(2) that the inspection firm has obtained, reviewed and
included within its report a CERCLIS printout from the
Environmental
Protection Agency (the "EPA"), statements from the EPA and
other
applicable state and local authorities and a Phase I
Environmental
Audit, all of which information shall confirm that there are no
known or suspected Hazardous Materials located at, used or
stored
on, or transported
43
<PAGE>
to or from each such Additional Eligible Resort or in such
proximity
thereto as to create a material risk of contamination of each
such
Additional Eligible Resort (an existing Phase I Environmental
Audit
is acceptable provided that Borrower will provide TFC with a
reliance letter
in favor of TFC if TFC requests such letter in
connection with the approval of the Additional Eligible
Resort);
(vii) evidence that Borrower is maintaining all policies of
insurance required by and in accordance with Section 7.1(d)
hereof,
including copies of the most current paid insurance premium
invoices;
(viii) evidence that Borrower and the Timeshare Documents for
each
Additional Eligible Resort for which Eligible Notes Receivable
are
being pledged to Agent as agent for Lenders in connection with
the
Advance in question are in compliance with all applicable laws
in
connection with its sales of Intervals, including without
limitation, the Timeshare Acts;
(ix) a current preliminary title report or certificate of title
for
each Additional Eligible Resort for which Eligible Notes
Receivable
are being pledged to Agent in connection with the Advance in
question, with copies of all title exceptions;
(x) copies of all applicable governmental permits, approvals,
consents, licenses, and certificates for the establishment of
each
Additional Eligible Resort for which Eligible Notes Receivable
are
being pledged to Agent as agent for Lenders in connection with
the
Advance in question as timeshare projects in accordance with
the
applicable Timeshare Act, and for the occupancy and intended use
and
operation of each such Additional Eligible Resort, including
the
Units, including a letter certification from Borrower regarding
zoning classification and compliance, letters or other
satisfactory
evidence from utility companies, governmental entities or other
persons confirming that water, sewer (sanitary and storm),
electricity, solid waste disposal, telephone, police, fire and
rescue services are
being provided to each Resort, and any business
licenses necessary for operation of each such Additional
Eligible
Resort;
(xi) certified true, correct and complete copies of all of the
Timeshare Documents for each Additional Eligible Resort for
which
Eligible Notes Receivable are being pledged to Agent as agent
for
Lenders in connection with the Advance in question; which shall
be
subject to TFC's review and approval;
(xii) evidence satisfactory to TFC that all taxes and
assessments
owed by or for which Borrower is responsible for collection
have
been paid, including but not limited to sales taxes, room
occupancy
taxes, payroll taxes, personal property taxes, excise taxes,
intangibles taxes, real property taxes, and income taxes, and
any
assessments related to each Additional Eligible Resort for
which
Eligible Notes Receivable are being pledged to Agent as agent
for
Lenders in connection with the Advance in question and copies of
the
most current paid tax bills for each such Additional Eligible
Resort
evidencing that each such Additional Eligible
44
<PAGE>
Resort have been segregated from all other property on the
applicable municipal taxrolls;
(xiii) written confirmation from an architect covering each
Additional
Eligible Resort, for which Eligible Notes Receivable are
being pledged to TFC in connection with the Advance in question
as
to the physical condition of the improvements at each such
Additional Eligible Resort, including that soil conditions are
sufficient to support all existing and any contemplated
improvements
to the real property; which written confirmation shall be in
form
and substance reasonably acceptable to TFC. Each architect
rendering
such written confirmation shall be licensed as an architect in
the
state in which the Additional Eligible Resort is located;
(xiv) to the extent not previously delivered, such current
credit
references on each Borrower as TFC deems necessary in its sole
discretion;
(xv) to the extent nor previously delivered, copies or other
evidence of all loans to or from any officers, shareholders,
Borrower's Agents, or Affiliates of each Borrower, if any;
(xvi) a commitment to issue Mortgagee Title Policies from Title
Company for each such Additional Eligible Resort.
Notwithstanding
anything heretofore to the contrary, if any claim, lien,
encumbrance, charge or other matter arises with respect to any
Interval or Intervals for which an Eligible Note Receivable has
been
pledged to Agent as agent for Lenders pursuant to this Agreement
and
which claims, lien, encumbrance, charge or other matter is
objectionable to TFC, then, in such event:
(1) The Note Receivable with respect to the Interval in
question shall cease to be an Eligible Note Receivable and
Borrower
immediately shall either replace the Note Receivable in question
or
make a Mandatory Prepayment as provided in Section 2.9(b)
hereof;
and
(2) The Resort at which the Interval in question is located
shall cease to be an Additional Eligible Resort, unless and
until
Borrower shall cure any such claim, lien, encumbrance, charge
or
other matter to the satisfaction of Agent. Furthermore, any and
all
further requests for Advances in respect of such Resort must be
accompanied by satisfactory Mortgagee Title Policies for all
Intervals with respect to which such Advances are requested.
(xvii) to the extent not previously delivered, the Financial
Statements;
(xviii) to the extent not previously delivered hereunder,
Borrower
will execute, or cause to be executed with respect to each
Additional Eligible Resort, a confirmation that the Collateral
includes any management agreement (with respect to the Marathon
Key
Resort only, as provided herein), Lockbox Agreement, an
Assignment
of Notes Receivable and Mortgages, Borrower's Affidavit with
Respect
45
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to the Additional Eligible Resorts and an Environmental
Indemnification Agreement, each in the form attached hereto and
made
a part hereof;
(xix) with respect to any improvements, including any Units,
constructed at a Resort within the twenty-four month period prior
to
any Revolving Credit Advance with respect to an Additional
Eligible
Resort, Borrower shall also deliver to TFC, for its approval,
such
documents and instruments as TFC may reasonably request in
connection with such newly constructed improvements, including,
without limitation, copies of building permits, plans and
specifications, construction and architectural contracts, title
insurance insuring over, among other things, mechanics liens,
certificates of occupancy and satisfactory evidence of the
completion of such improvements;
(xx) true, correct and complete copies of the form of all
Purchaser
Documents (as defined in Section 5.1(c)(ii), which shall be in
form
and substance satisfactory to TFC and which shall comply in all
material respects with all Governmental Requirements;
(xxi) such other documents, instruments, agreements, tests,
reports
and inspections as TFC may reasonably require with respect to
either
Borrower or any Affiliate of either Borrower, the Loan or any
Resort, including any Additional Eligible Resort; and
(xxiii) Upon request of TFC, each Borrower shall deliver to TFC
evidence, satisfactory to TFC, that there is no material
litigation,
written complaint, suit, action, written claim or written
charge
pending against either Borrower, or any Affiliate of either
Borrower
with any court or with any governmental authority with respect
to
the Resort, the Timeshare Documents, any Eligible Notes
Receivable,
any Interval, or any marketing, offer or sale of any Interval.
(d)
Physical Inspection. TFC shall have received and approved the
physical
inspection of the Additional Eligible
Resorts conducted by TFC and the
Inspecting Architect/Engineers.
(e) UCC
Search. Borrower shall have obtained, at Borrower's cost, such
searches of the applicable public records
as it deems necessary under all
applicable law to verify that Agent has a
first or second, as applicable, and
prior perfected Lien and security interest
covering all of the Collateral with
respect to the Additional Eligible Resort
in question. Agent shall not be
obligated to fund any Advance if Agent
determines that Lenders do not have a
first or second, as applicable, and prior
perfected lien and security interest
covering any portion of the Collateral,
except as expressly provided herein.
(f)
Litigation Search. Borrower shall have obtained, at Borrower's
cost,
an independent search to verify that there
are no bankruptcy, foreclosure
actions or other material litigation or
judgments pending or outstanding against
the Additional Eligible Resorts, any
portion of the Collateral, either Borrower
or any Affiliate of either Borrower, (each
a "Material Party"). The term "other
material litigation" as used herein shall
not include matters in which (i) a
Material
46
<PAGE>
Party is plaintiff and no counterclaim is
pending or (ii) which Agent
determines, in its sole discretion,
exercised in good faith, are immaterial due
to settlement, insurance coverage,
frivolity, or amount or nature of claim.
Agent shall not be obligated to fund any
Advance if it determines that any such
litigation is pending.
(g)
Opinions of Counsel. Borrower shall deliver to Agent, for the
benefit
of Agent and each Lender, at Borrower's
sole cost and expense, an Opinion of
Counsel in the form attached as Exhibit
R-2, together with an opinion of counsel
admitted in each state in which each
Additional Eligible Resort is located, as
to such matters with respect to Borrower
and each Additional Eligible Resort as
Agent may reasonably request, and in form
and substance reasonably acceptable to
Agent.
(h)
Funding Procedure. Borrower shall have complied to TFC's
satisfaction
with each of the conditions precedent to
funding of an Advance set forth in
Section 5 hereof.
(i)
Management of Resort. Borrower shall provide evidence satisfactory
to
TFC that Borrower or an Affiliate of
Borrower, is the manager or operator of
each Additional Eligible Resort, pursuant
to a written management or operating
agreement, in form and substance
satisfactory to TFC. Borrower agrees to provide
an estoppel letter, in form and substance
acceptable to TFC, from the applicable
Timeshare Owner's Association. Subject to
Section 3 hereof, the management
agreement from the Marathon Key Resort only
shall constitute a part of the
Collateral and will be assigned to Agent,
on behalf of Lenders, until such time
as the Marathon Key Resort commences
operations as a time
