ACQUISITION, CONSTRUCTION AND RECEIVABLE LOAN, SECURITY AND AGENCY AGREEMENT

 

 

                                                                  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.

 

 

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      (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.

 

 

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      (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;

 

 

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            (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.

 

 

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      (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.

 

 

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<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.

 

 

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<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 th