ADDENDUM TO CONSTRUCTION LOAN AGREEMENT CONDOMINIUM AND TOWNHOUSE PROJECT DEVELOPMENTConstruction Loan Agreement |
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Search Construction Loan Agreement by:
Exhibit 10.12
ADDENDUM TO
CONSTRUCTION LOAN AGREEMENT
CONDOMINIUM AND
TOWNHOUSE PROJECT DEVELOPMENT
CONSTRUCTION
OF NEW PROJECT
THIS ADDENDUM TO CONSTRUCTION LOAN
AGREEMENT ("Addendum") is made as of the
----------
29
day of December,
2005, by and
between KEYBANK NATIONAL ASSOCIATION
("Lender") and TIERRA
DEL SOL RESORT
(PHASE 1), LTD.,
a Florida limited
--------
partnership, TDS TOWN HOMES (PHASE 1), LLC, a Florida limited liability
company,
COSTA BLANCA I
REAL ESTATE, LLC,
a Florida limited liability
company, TDS
AMENITIES, INC., a Florida corporation (jointly and severally
"Borrower").
---------
Lender and Borrower have entered
into a Construction Loan Agreement of even
date herewith (the
"Loan Agreement") wherein
Lender has agreed to make a
---------------
revolving real estate
construction loan (the "Loan") in the maximum principal
----
amount of $40,000,000.00 to Borrower under the terms and conditions
described
therein.
By
the terms of this Addendum Lender and Borrower describe
and set forth
the terms and
conditions whereby Units
(as hereinafter defined)
to be
constructed pursuant to the Loan Agreement shall be from time to
time released
from the lien of the Mortgage in order that Borrower may sell the Units.
1.
ADDITIONAL DEFINITIONS. The following additional "Definitions"
shall be
----------------------
added to and be a part of Article I of
the Loan Agreement. Any capitalized term
used herein shall,
if not specifically defined within this Addendum, have the
meaning defined and set forth in the Loan Agreement.
1.1 ADDITIONAL COLLATERAL: Has
the meaning set forth in Section 3.6 of
---------------------
this Addendum.
1.2 APPROVED
SALES PRICE: The Lender's minimum contract sales prices
---------------------
for each Unit set forth in EXHIBIT
"A" attached hereto.
1.3 ASSIGNMENT
OF GOVERNING DOCUMENTS: That
certain Conditional
----------------------------------
Assignment of
Unit Sales Contracts, Governing Documents and
Developer's
Rights executed
of even date herewith by Borrower
in favor of Lender, as
the
same may be amended,
supplemented, extended, renewed, replaced and/or
restated from time to time in
accordance with its terms
1.4 CERTIFICATE OF UNIT
OCCUPANCY: A permanent certificate issued by a
-----------------------------
municipality or an applicable department
thereof certifying that all of the
Units, as constructed, may be
legally occupied.
1.5 CONDOMINIUM:
Costa Blanca I
Condominium, a condominium to be
-----------
established in
accordance with the
Condominium Statute pursuant to the
Condominium Documents.
1.6 CONDOMINIUM DEPOSIT(S): All
reservations, deposits, down payments,
----------------------
or
the like paid
under Contracts of
Sale or reservation receipts for
Condominium Units at the Project.
1.7 CONDOMINIUM
DOCUMENTS: All of
the documents required by the
----------------------
Condominium Statute
or otherwise, relating
to the submission
of the
applicable portion
of the Project
to the provisions of the Condominium
Statute or
to the regulation, operation, administration or sale
thereof
after such
submission, including, but
not limited to a declaration of
condominium, by-laws and rules and
regulations of a condominium association
or
associations, Master Association Documents, management agreement, plats
<PAGE>
and
plans and the
of the Contract of Sale and deed
forms to be used in
connection with
the sale of the
Units, all of which must be reasonably
acceptable to Lender in form and
substance.
1.8 CONDOMINIUM
STATUTE: Chapter 718, Florida Statutes, as it may
--------------------
be amended from time to time.
1.9
CONDOMINIUM UNIT(S): Any
dwelling unit within
the Project
--------------------
submitted to
the condominium form
of ownership under the Condominium
Statute.
1.10 CONTRACT
DEPOSITS: the collective
reference to Condominium
------------------
Deposits and Townhouse Deposits.
1.11 CONTRACT
OF SALE: A legally enforceable contract, in form and
------------------
content satisfactory to Lender and
Lender's counsel, between Borrower and a
bona
fide third party purchaser for the sale and purchase of an individual
Unit
at a sales price of not less than the Minimum
Release Price, with a
Contract Deposit
of not less
than twenty percent
(20%) of the total
purchase price
of the Unit being sold, which
Contract Deposit shall have
been
paid and such deposit shall
constitute cash or immediately available
funds to
the Escrow Agent.
All items required
to be disclosed to a
purchaser under the Chapter 718,
Florida Statutes shall have been delivered
to each purchaser. Without limiting
the foregoing requirements, a "Contract
for
Sale" shall not
include any contracts
entered into prior to the
effective date
of all necessary
filings with the State of Florida
and
pursuant to Chapter 718, Florida Statutes. Each
contract must by the terms
thereof (i)
be expressly inferior
and subordinate to the lien of any
mortgage
now or hereafter
existing which encumbers the Project, (ii) be
non-assignable without
the Lender's prior written
consent (which written
consent will not be unreasonably withheld or
delayed), and (iii) otherwise
comply with
all requirements of
Governmental Authorities so that the
purchaser of
such Unit shall
have no election or right to rescind such
contract without the loss of its Contract Deposit. For
the purpose of this
Addendum, a
purchaser shall not
be considered a bona fide third
party
purchaser if it has contracted,
directly or indirectly, for the purchase of
more
than two (2)
Units. In addition, no more than two (2) Units may be
purchased by
purchasers of multiple units, and no more than thirty-five
(35)
Units may be sold to Insiders (as hereinafter defined).
Moreover, a
bona
fide third party purchaser shall not include the Borrower, any member
or
manager of the Borrower, any stockholder, director,
officer, partner,
member or
manager of any member or manager of Borrower, or any
partner,
member manager,
stockholder, director or officer of any constituent party
of
any member or manager of the Borrower, or any member of
the immediate
family or affiliate (as defined in Rule 405 of the
Securities Act of 1933)
of any of the foregoing parties
(collectively, "Insiders"). Notwithstanding
--------
any
contrary provision of this Section 1.11 or of any other
provision of
this
Addendum or any
other Loan Document,
Lender hereby accepts and
approves all
Contracts of Sale identified on
EXHIBIT "B" attached hereto
and
acknowledges that each of such Contracts of Sale identified in EXHIBIT
"B" attached hereto
constitute a "Required Contract of Sale" for purpose of
Section 3.3 of this Addendum and an approved Contract
of Sale for purposes
of Section 8.1(b) of the Loan
Agreement.
1.12 DIVISION: Has the meaning set forth in
Section 5.1(b) hereof.
--------
1.13 ESCROW
ACCOUNT: An account maintained
with the Escrow Agent at
---------------
KeyBank National
Association into which
all Contract Deposits are paid
pursuant to this Addendum.
1.14 ESCROW AGENT MEANS A FIRM OR INDIVIDUAL
ACCEPTABLE TO LENDER.
-------------------------------------------------------------
The Escrow Agent approved by Lender
is OVT Title Agency, LLC.
1.15 GOVERNING
DOCUMENTS: the Condominium
Documents as to the
--------------------
Condominium Units,
and the Master
Association Documents as to the
fee
simple Townhouse Units.
<PAGE>
1.16 LOAN DOCUMENTS: Shall
mean, in addition to those set forth in the
--------------
Definitions in
the Loan Agreement, this Addendum, and the Assignment
of
Governing Documents.
1.17 LOAN-TO-VALUE
RATIO: The ratio
obtained by dividing
the
--------------------
outstanding principal
balance due on the Loan Amount (as of the testing
date) by the fair market value of
the Project as determined by an Appraisal
1.18 MASTER
ASSOCIATION: Tierra del Sol Owners' Association, Inc., a
-------------------
Florida corporation.
1.19 MASTER
ASSOCIATION DOCUMENTS: All of the
documents relating to
------------------------------
the
creation, regulation, operation
and/or administration of the Master
Association, including the common properties, basic resort
services and/or
resort facilities, as defined
therein.
1.20 MINIMUM
RELEASE PRICE: The Lender's minimum release price for
-----------------------
each Unit shall be as set forth in
EXHIBIT "A" attached hereto.
1.21 NET
SALE PROCEEDS: Shall mean the purchase price for each Unit,
------------------
including all
amounts paid for extras and the like (excluding, however,
amounts for
extras and the
like paid for from sources other
than Loan
proceeds), less:
(i) third party
brokerage fees to the extent due from
Borrower; (ii) customary closing
costs and adjustments paid by the Borrower
(for
documentary stamp tax, recording fees and taxes, etc.); and (iii) any
purchase deposits approved for use
in the Project.
1.22 RELEASE PRICE: The greater of (i) 100% of Net
Sales Proceeds for
-------------
an applicable Unit; or (ii) the
Minimum Release Price.
1.23 REQUEST FOR PARTIAL RELEASE: Shall have the
meaning set forth in
---------------------------
Section 6.3(c) hereof
1.24 REQUIRED
CONTRACTS OF SALE: Shall have the meaning set forth in
---------------------------
Section 3.3 hereof.
1.25 TOWNHOUSE DEPOSIT(S): All reservations, deposits,
down payments,
--------------------
or
the like paid
under Contracts of
Sale or reservation receipts for
Townhouse Units at the Project.
1.26 TOWNHOUSE
UNIT(S): Attached dwelling units located within the
-----------------
Project constructed,
or to be
constructed, on a lot not submitted to
condominium ownership.
1.27 UNIT OR UNITS: Means (i)
the Condominium Units located within the
-------------
Project, and (ii) the Townhouse
Units located within the Project.
2.
ADDITIONAL REPRESENTATIONS AND
WARRANTIES. In addition
to the
--------------------------------------------
Representations and Warranties
of Borrower set forth in Section 3 of the Loan
Agreement, Borrower hereby represents and warrants to Lender:
2.1 CONTRACTS
OF SALE. All of
the Contracts of Sale identified on
-------------------
EXHIBIT "B", attached
hereto, are in full force and effect and are valid
and
subsisting; to the best of
Borrower's knowledge there are no defaults
thereunder or any defenses or offsets thereto on the
part of any purchaser
thereunder and no notice has been received from any purchaser
claiming any
default by the Borrower, as seller, thereunder or
requesting a termination
thereof. No
modifications or amendments
have been made to any of such
Contracts of
Sale except as previously disclosed in writing to Lender and
<PAGE>
no
agreements are in
existence, oral or written, which would or could
modify the
obligations of the
Borrower, as seller, or the purchasers
thereunder. Except
as disclosed to Lender, Borrower has neither committed
nor
suffered any act or omission which would or could constitute a default
on
its part entitling any purchaser to damages, rights of set-off or right
to
terminate any Contract of Sale. EXHIBIT "B"
accurately identifies all
Contract Deposits
paid by the purchasers under
Contracts of Sale and all
Contract Deposits
for Condominium Units only are
being held, pursuant to
the
form of escrow agreement(s)
previously approved by Lender in separate
Escrow Account(s)
under the exclusive control of
the Escrow Agent, which
Escrow Account(s)
meet all of the requirements of
the provisions of this
Addendum.
2.2 CONDOMINIUM
DOCUMENTS. To the extent such
approval is required,
----------------------
the
Condominium Documents have
been approved by all applicable federal,
state or
local governmental agencies or
entities with approval authority
over such documents, and Borrower
agrees to maintain such approvals in good
standing throughout the term of the
Loan.
3. ADDITIONAL COVENANTS. In addition
to the covenants of Borrower set forth
--------------------
in Section 15
of the Loan Agreement, Borrower hereby agrees and
promises as
follows:
3.1 EXPENSES. In addition to
the fees and expenses of Lender agreed to
--------
be
paid by Borrower under the Loan Agreement, Borrower shall pay (promptly
upon
the rendering of
such a bill and delivery thereof to Borrower) all
reasonable out-of-pocket expenses
incurred by the Lender in connection with
the review of any proposed
easements, final approval and recordation of the
Governing Documents,
partial releases, and
satisfaction of a loan of
character contemplated hereby.
3.2 LEASE
OF PROJECT. Except
for leases of
Units pursuant to
------------------
Borrower's plan
to operate the
Project as a resort, Borrower
will not
lease, sublease, license or grant
any occupancy arrangement with respect to
the
Project, without the
prior written consent
of Lender except as
otherwise expressly
permitted under the Loan
Agreement, Mortgage and the
Assignment of Leases.
3.3 CONTRACTS
OF SALE. Prior
to the initial disbursement of
Loan
-------------------
proceeds (other
than initial closing expenses), Borrower shall deliver to
Lender Contracts for Sale for at least thirty-three
(33) of the thirty-six
(36) Units contained in each
building to be constructed which shall produce
aggregate Net
Sale Proceeds sufficient
to cover 120%
of the maximum
aggregate funding permitted under the Loan and with
each sales price being
otherwise acceptable to Lender based on
Lender's underwriting analysis (the
"Required Contracts of Sale"). If at any time the
foregoing requirement is
---------------------------
not
satisfied, such failure shall constitute an Event of Default hereunder
and
under the Loan
Agreement unless the
Borrower provides to Lender
substitute Contracts
for Sale of equal or greater
purchase prices within
thirty (30)
days of the
occurrence of such failure. Borrower shall not
modify, amend,
cancel, rescind, extend, terminate, or otherwise change in
any
manner any Contract of Sale without the prior written
consent of the
Lender. Additionally,
Borrower shall not enter into any new Contract of
Sale with a purchase price less than
the Approved Sales Price. Furthermore,
Borrower shall not enter into any new Contract of Sale
that will require a
modification to the
Plans, the cost of which exceeds five percent (5%) of
the
Approved Sales Price for such Unit. All Contracts of Sale must include
a
delivery date that can be achieved in accordance with the
Construction
Schedule. Additionally, a
matrix must be
approved by Lender
that
demonstrates on
a Unit-by-Unit basis that each Unit under a Contract of
Sale
will be delivered within twenty-four (24) months from the date of the
Contract of
Sale. No extension
of such contracts may be made without
Lender's approval.
3.4 GOVERNING
DOCUMENTS. Borrower shall
not modify, amend,
or
--------------------
otherwise change
(including without limitation,
any change that would
permit any
purchaser to cancel
its respective Contract of Sale) in any
manner the
Governing Documents without the prior written consent of the
Lender (which
written consent will
not be unreasonably
withheld or
delayed). Borrower
covenants and agrees that it shall comply with, to the
<PAGE>
extent applicable to the Project, (a) all
requirements of the Division, (b)
all
regulations promulgated from
time to time by the State of
Florida,
pursuant thereto, including without
limitation, the filing requirements for
the
Governing Documents (as
applicable), and Borrower's
obligations as
developer of
the Condominium and
the Townhouse Units,
and (c) all
requirements and requests of the Division in connection
with the filing of
the
Declaration and the






