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AMERICAN LEISURE HOLDINGS, INC. | KEYBANK NATIONAL ASSOCIATION | COSTA BLANCA I REAL ESTATE, LLC | TDS AMENITIES, INC | TDS TOWN HOMES (PHASE 1), LLC. RealDealDocs™ contains millions of easily searchable legal documents and clauses from top law firms. Search for free - click here. |
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Search Construction Loan Agreement by:
Exhibit 10.5
CONSTRUCTION
LOAN AGREEMENT
for a loan in
the amount of
$40,000,000.00
MADE BY
AND BETWEEN
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,
AND
KEYBANK
NATIONAL ASSOCIATION,
a national
banking association
200 E. Robinson
Street, Suite 555
Orlando,
Florida 32801
Dated as of
December 29, 2005
<PAGE>
TABLE OF
CONTENTS
-----------------
(CONT'D)
Page
----
Article 1 INCORPORATION
OF RECITALS AND
EXHIBITS 1
1.1 Incorporation of
Recitals. 1
1.2 Incorporation of
Exhibits. 2
Article 2 DEFINITIONS
2
2.1 Defined Terms. 2
2.2 Other Definitional
Provisions. 10
Article 3 BORROWER'S
REPRESENTATIONS AND WARRANTIES 10
3.1 Representations and
Warranties. 10
3.2 Survival of
Representations and Warranties. 13
Article 4 LOAN
AND LOAN DOCUMENTS 13
4.1 Agreement to
Borrow and Lend; Lender's
Obligation to Disburse. 13
4.2 Loan Documents.
14
4.3 Term of
the Loan.
15
4.4 Prepayments.
16
4.5 Required Principal
Payments. 16
4.6 Late Charge.
16
Article 5 INTEREST
16
5.1 Interest Rate.
16
5.2 Interest Rate
Agreements. 17
Article 6 COSTS
OF MAINTAINING LOAN 17
6.1 Increased Costs
and Capital Adequacy. 17
6.2 Borrower Withholding.
18
Article 7 LOAN
EXPENSE AND ADVANCES 19
7.1 Loan and
Administration Expenses. 19
7.2 Lender's Attorneys'
Fees and Disbursements. 19
7.3 Time of
Payment of Fees
and Expenses. 19
7.4 Expenses and
Advances Secured by Loan Documents. 20
7.5 Right of
Lender to Make Advances to Cure Borrower's Defaults. 20
Article 8 NON-CONSTRUCTION REQUIREMENTS
PRECEDENT TO THE OPENING OF
THE LOAN
20
8.1 Non-Construction Conditions
Precedent.
20
Article 9 CONSTRUCTION REQUIREMENTS
PRECEDENT TO THE OPENING OF THE LOAN
23
9.1 Required Construction
Documents. 23
Article 10 BUDGET
AND CONTINGENCY FUND 24
10.1 Budget.
24
10.2 Budget Line
Items.
24
10.3 Contingency Fund.
25
10.4 Optional Method
for Payment of
Interest.
25
<PAGE>
Article 11 SUFFICIENCY
OF LOAN 25
11.1 Loan In
Balance.
25
Article 12 CONSTRUCTION
PAYOUT REQUIREMENTS 26
12.1 Applicability of
Sections. 26
12.2 Monthly Payouts.
26
12.3 Documents to
be Furnished for
Each Disbursement. 26
12.4 Retainages.
27
12.5 Disbursements for
Materials Stored On-Site. 27
12.6 Disbursements for
Offsite Materials. 27
Article 13 FINAL
DISBURSEMENT FOR CONSTRUCTION 28
13.1 Final Disbursement
for Construction. 28
Article 14 RESERVED
29
Article 15 OTHER
COVENANTS
29
15.1 Borrower further
covenants and agrees
as follows: 29
15.2 Authorized Representative. 36
Article 16 CASUALTIES
AND CONDEMNATION 36
16.1 Lender's Election
to Apply Proceeds
on Indebtedness. 36
16.2 Borrower's Obligation
to Rebuild and Use of Proceeds Therefor. 37
Article 17 ASSIGNMENTS
BY LENDER AND
BORROWER
37
17.1 Assignments and
Participations. 37
17.2 Prohibition
of Assignments and
Transfers by Borrower. 37
17.3 Prohibition of
Transfers in Violation
of ERISA. 38
17.4 Successors and
Assigns. 38
Article 18 TIME OF THE
ESSENCE 38
18.1 Time is
of the Essence. 38
Article 19 EVENTS
OF DEFAULT
38
Article 20 LENDER'S
REMEDIES IN EVENT
OF DEFAULT 40
20.1 Remedies Conferred
Upon Lender. 40
Article 21 GENERAL
PROVISIONS
41
21.1 Captions. 41
21.2 Modification; Waiver.
41
21.3 Governing Law.
42
21.4 Acquiescence Not to Constitute Waiver of Lender's
Requirements. 42
21.5 Disclaimer by
Lender.
42
21.6 Partial Invalidity;
Severability. 43
21.7 Definitions Include
Amendments.
43
21.8 Execution in
Counterparts. 43
21.9 Entire Agreement.
43
21.10 Waiver of
Damages.
44
21.11 Claims Against
Lender. 44
<PAGE>
21.12 Jurisdiction.
44
21.13 Set-Offs.
44
Article 22 NOTICES
45
Article 23 WAIVER
OF JURY TRIAL 46
EXHIBITS
--------
EXHIBIT "A" Legal
Description of Land
EXHIBIT "B" Permitted
Exceptions
EXHIBIT "C" Title
Requirements
EXHIBIT "D" Form
of Survey Certification
EXHIBIT "E" Insurance
Requirements
EXHIBIT "F" Architect's Certificate
EXHIBIT "G" Initial
Budget
EXHIBIT "H" Borrower's
Certificate
EXHIBIT "I" Soft
and Hard Cost
Requisition Form
EXHIBIT "J" Borrower's
Certificate of Compliance
EXHIBIT "K" Sources
and Uses of
Funds
EXHIBIT "L" Survey
Requirements
EXHIBIT "M" Required
Contracts and Deposits
<PAGE>
CONSTRUCTION
LOAN AGREEMENT
---------------------------
PROJECT
COMMONLY KNOWN AS
"TIERRA
DEL SOL PHASE I"
----------------------
THIS CONSTRUCTION LOAN AGREEMENT
("Agreement") is made as of December 29,
-----------
-----
2005, by
and between TIERRA DEL SOL RESORT
(PHASE 1), L.P., a Florida limited
partnership ("Tierra del Sol"), TDS TOWN HOMES (PHASE 1), LLC, a
Florida limited
---------------
liability company ("TDS Town Homes"), COSTA BLANCA I REAL ESTATE,
LLC, a Florida
---------------
limited liability company
("Costa Blanca"), TDS
AMENITIES, INC., a Florida
---------------
corporation ("TDS Amenities")
(Tierra del Sol, TDS Town Homes, Costa Blanca and
--------------
TDS Amenities hereinafter
referred to, jointly and severally, as "Borrower"),
----------
and KEYBANK NATIONAL ASSOCIATION, a national banking association, its
successors
and assigns ("Lender").
--------
W I T N E S S E T H:
--------------------
RECITALS
--------
A.
TDS Town Homes is the owner in fee simple of land located in the County
of Polk,
State of Florida,
and legally described on EXHIBIT
"A-1" attached
hereto, and the improvements located
thereon (the "TDS Town Homes Land"), Costa
-------------------
Blanca is the owner in fee simple of land located in
the County of Polk, State
of Florida, and
legally described on EXHIBIT "A-2" attached hereto,
and the
improvements located thereon
(the "Costa Blanca
Land"), TDS Amenities is the
------------------
owner in fee simple of land located in the County of Polk, State of Florida,
and
legally described on EXHIBIT "A-3" attached hereto, and the
improvements located
thereon (the TDS
Amenities Land") (the TDS
Town Homes Land, the Costa Blanca
--------------------
Land and the TDS Amenities Land
hereinafter referred to as the "Land"). Each of
-----
TDS Town
Homes, Costa Blanca and TDS Amenities is a wholly-owned subsidiary of
Tierra del Sol.
Borrower proposes to
develop and construct
a luxury
townhome/condominium project as more particularly described in the definition
of
"Improvements" below.
B.
Borrower has applied
to Lender for a revolving loan in the maximum
principal amount of
FORTY MILLION AND
NO/100 DOLLARS ($40,000,000.00) (the
"Loan" or the
"Phase 1 Loan")
to reimburse Borrower for construction and
----- --------------
development of the Project, and Lender
is willing to make the Loan on the terms
and conditions hereinafter set forth.
NOW,
THEREFORE, in consideration
of the mutual covenants and agreements
herein contained, the parties hereto agree as follows:
ARTICLE 1
INCORPORATION OF
RECITALS AND EXHIBITS
--------------------------------------
1.1 INCORPORATION OF RECITALS.
-------------------------
The
foregoing preambles and all other recitals set forth herein are made a
part hereof by this reference.
1.2 INCORPORATION OF EXHIBITS.
-------------------------
EXHIBITS "A"
through "L," to
this Agreement, attached
hereto, are
incorporated in this
Agreement and expressly
made a part
hereof by this
reference.
-1-
<PAGE>
ARTICLE 2
DEFINITIONS
-----------
2.1 DEFINED TERMS.
-------------
The
following terms as used herein shall have the following
meanings (as
supplemented by the Addendum):
Acquisition Proceeds: As such term
is defined in Section 8.1(t)(i).
-------------------- -----------------
Addendum: The
Addendum to Construction Loan Agreement - Condominium and
--------
Townhouse Project Development.
Adjusted Daily
LIBOR Rate: An interest rate per annum equal to the sum of
---------------------------
(a) the
Daily LIBOR Rate
plus (b) the LIBOR Rate Margin. The Adjusted Daily
LIBOR Rate shall change immediately and contemporaneously with any change in
the
Daily LIBOR Rate.
Adjusted Prime
Rate: A rate per annum equal to the sum of (a) the
Prime
---------------------
Rate Margin and (b) the greater of (i) the Prime Rate or
(ii) one percent (1%)
in excess of the Federal Funds Effective
Rate. Any change in the Adjusted Prime
Rate shall be effective immediately from and after such
change in the Adjusted
Prime Rate (or the Federal Funds Effective Rate, as applicable).
Affiliate: With
respect to a specified person or
entity, any individual,
---------
partnership, corporation, limited
liability company, trust,
unincorporated
organization, association or other entity which, directly or indirectly,
through
one or
more intermediaries, controls
or is controlled by or is under common
control with such person or entity, including, without limitation,
any general
or limited partnership in which such person or entity is a partner.
Agreement: This Construction Loan
Agreement.
---------
Applicable Rate: As such term is
defined in Section 5.1(a).
--------------- --------------
Appraisal: An
MAI certified appraisal
of the Project
performed in
---------
accordance with FIRREA
and Lender's appraisal
requirements by Integra Realty
Resources.
Architect: Fugleberg Koch Architects,
Inc.
---------
Architect's Certificate: A certificate in the form of
EXHIBIT "F" attached
------------------------
hereto executed by the Architect in favor of Lender.
Assignment of Rents: An assignment of leases and rents made
by Borrower in
--------------------
favor of Lender assigning all leases, subleases and other agreements relating
to
the use and occupancy of all or any
portion of the Project, and all present and
future leases, rents, issues and profits therefrom.
-2-
<PAGE>
Bankruptcy Code:
Title 11 of the United States Code entitled "Bankruptcy"
----------------
as now or hereafter in effect, or any
successor thereto or any other present or
future bankruptcy or insolvency statute.
Bond: A
Performance Bond and
Labor and Material Payment Bond in a form
----
approved by Lender, with Major
Subcontractor, as the case may be, as principal,
with a
surety company acceptable to
Lender and licensed to do business in the
State, as surety, with a dual obligee rider in favor of Lender.
Budget: The
budget for the Project specifying all costs and expenses
of
------
every kind and nature whatever to be incurred by Borrower in connection with the
Project prior to the Maturity Date.
Budget Line Item: As such term is
defined in Section 10.2.
----------------
Business Day:
A day of
the year on
which banks are not required or
-------------
authorized to close in Orlando, Florida.
Buyer's Deposit
Shortfall Account: As
such term is defined in Section
------------------------------------
15.1(w).
CDD: As such term is defined in
Section 8.1(t)(i).
---
CDD Bonds: As such term is defined
in Section 8.1(t)(i).
---------
CDD Bond Trustee: Suntrust Bank
----------------
Change Order:
Any request for
changes in the Plans and
Specifications
-------------
(other than minor field changes involving no extra cost).
Collateral Account: As such term is defined
in Section 15.1(t).
------------------
Collateral Account LC: As such term
is defined in Section 15.1(t).
---------------------
Completion Date:
On or before the date twenty-one (21) months after
the
----------------
Construction Commencement Date.
Completion Guarantor:
PCL Construction Enterprises,
Inc., a Colorado
---------------------
corporation.
Completion Guaranty:
A guaranty of the obligations of General
Contractor
--------------------
under the General Contract executed by
the Completion Guarantor and pursuant to
which the Completion Guarantor guarantees the timely
completion of the General
Contract in accordance
with all provisions of the General Contract and this
Agreement.
Condominium: As such term is defined
in the Addendum.
-----------
Condominium Unit
or Condominium Units:
As such term is defined in the
-----------------------------------------
Addendum.
Construction or
construction: The construction
and equipping of the
------------------------------
Improvements in accordance
with the Plans and Specifications, and all related
improvements required to be performed by
Borrower under Leases and/or Contracts
of Sale
(as defined in
the Addendum), and the
installation of all personal
property, fixtures and equipment required for the operation of the Project.
Construction Commencement Date: On
or before thirty (30) days from the Date
------------------------------
of Closing.
-3-
<PAGE>
Construction Schedule:
A schedule satisfactory
to Lender and Lender's
----------------------
Consultant, establishing a
timetable for completion
of the Construction,
showing, on a
monthly basis, the anticipated progress of the Construction and
also showing that the Improvements can
be completed on or before the Completion
Date. The Construction Schedule must
demonstrate that Units can be delivered in
October, 2006 and each month thereafter in accordance with the General
Contract.
Contingency Fund:
A Budget Line
Item which shall represent an amount
-----------------
necessary to provide reasonable assurances to Lender that
additional funds are
available to be used if additional costs and expenses are incurred or
additional
interest accrues on the Loan, or unanticipated events or problems occur.
Contract Deposit
or Contract Deposits:
As such term is defined in the
------------------ --------------------
Addendum.
Contract of
Sale or Contracts
of Sale: As such term is defined
in the
------------------- ---------------------
Addendum.
Control: As
such term is used with
respect to any person or entity,
-------
including the correlative
meanings of the
terms "controlled by" and "under
common control with", shall mean
the possession, directly or indirectly, of the
power to direct or cause the direction of the management policies of such
person
or entity, whether
through the ownership of voting securities, by contract or
otherwise.
Daily LIBOR
Rate: The rate per annum
calculated by Lender in good faith,
------------------
which Lender determines with reference to the rate per annum (rounded upwards
to
the next higher whole multiple of 1/16th if such rate is not such a multiple)
at
which deposits in United States dollars are offered by prime banks in the
London
Interbank Eurodollar Market
two LIBOR Business days prior to the day on which
such rate is calculated by the Lender in an amount
comparable to the amount of
such advance and with a maturity equal to the LIBOR Rate Interest Period.
Date of Closing: December 29, 2005.
--------------- -----
Default or default: Any event,
circumstance or condition, which, if it were
------------------
to continue uncured, would, with notice
or lapse of time or both, constitute an
Event of Default hereunder.
Default Rate:
A rate per
annum equal to the greater of: (i) eighteen
-------------
percentage points (18%)
per annum; or (ii) three percentage points (300 basis
points) in excess of the Applicable Rate, but shall not
at any time exceed the
highest rate permitted by law.
Deficiency Deposit: As such term is
defined in Section 11.1.
------------------ -------------
Environmental Indemnity:
An environmental indemnity from the Borrower and
------------------------
Guarantors, jointly and
severally, indemnifying Lender
with regard to all
matters related to Hazardous Material and other environmental matters.
Environmental Proceedings:
Any environmental proceedings, whether civil
--------------------------
(including actions by private parties), criminal, or administrative
proceedings,
relating to the Project.
Environmental Report:
An environmental report (a
"Phase 1" environmental
---------------------
assessment) prepared at
Borrower's expense by a qualified
environmental
consultant approved by Lender, dated not more than six (6) months
prior to the
Loan Opening Date
and addressed to
Lender (or subject to separate letter
agreement permitting Lender to rely on such environmental report).
-4-
<PAGE>
ERISA: The Employee Retirement
Income Security Act of 1974, as amended, and
-----
the regulations promulgated thereunder from time to time.
Escrow Account(s): As such term is
defined in the Addendum.
-----------------
Event of Default: As such term is
defined in ARTICLE 19.
----------------
Federal Funds
Effective Rate: Shall mean, for any day, the rate per annum
------------------------------
(rounded upward to the
nearest on one-hundredth of one percent (1/100 of 1%))
announced by the
Federal Reserve Bank of Cleveland on such day as being the
weighted average of the rates on overnight federal funds
transactions arranged
by federal funds brokers on the previous
trading day, as computed and announced
by such
Federal Reserve Bank in
substantially the same manner as such Federal
Reserve Bank computes
and announces the weighted
average it refers to as the
"Federal Funds Effective Rate."
FIRREA: The Financial Institutions Reform, Recovery
And Enforcement Act of
------
1989, as amended from time to time.
General Contract:
The general contract(s)
between Borrower and General
-----------------
Contractor, pertaining to the construction of all Improvements.
General Contractor: PCL Construction
Services, Inc.
------------------
Governmental Approvals:
Collectively, all consents, licenses, and permits
-----------------------
and all
other authorizations or
approvals required from
any Governmental
Authority for the Construction in accordance with the Plans and Specifications.
Governmental Authority: Any federal,
state, county or municipal government,
----------------------
or political subdivision thereof, any governmental or quasi-governmental
agency,
authority, board, bureau,
commission, department,
instrumentality, or public
body, or any court, administrative tribunal, or public utility.
Guarantor(s): The
individual or collective
reference to the
Payment
------------
Guarantors and the
Performance and Completion
Guarantors (but specifically
excluding the Completion Guarantor), as the context shall imply.
Hazardous Material:
Means and includes
gasoline, petroleum, asbestos
-------------------
containing materials, explosives,
radioactive materials or any hazardous or
toxic material, substance or waste which is defined by those or similar terms
or
is regulated as
such under any
Law of any
Governmental Authority having
jurisdiction over the Project or any
portion thereof or its use, including: (i)
any "hazardous substance" defined
as such in
(or for purposes
of) the
Comprehensive Environmental Response,
Compensation and Liability
Act, 42
U.S.C.A. Sec. 9601(14)
as may be amended from time to
time, or any so-called
"superfund" or "superlien" Law, including the
judicial interpretation thereof;
(ii) any
"pollutant or contaminant" as defined in 42 U.S.C.A.
Sec. 9601(33);
(iii) any material now defined as "hazardous
waste" pursuant to 40 C.F.R. Part
260; (iv) any
petroleum, including crude
oil or any fraction thereof; (v)
natural gas, natural gas liquids, liquefied natural gas, or synthetic gas
usable
for fuel; (vi)
any "hazardous chemical" as defined pursuant to 29 C.F.R. Part
1910; and (vii) any other toxic
substance or contaminant that is subject to any
other Law or
other past or present requirement of any Governmental Authority.
Any reference above to a Law, includes the same as it may
be amended from time
to time, including the judicial interpretation thereof.
-5-
<PAGE>
Improvements: A
luxury townhome/condominium project
consisting of 114
------------
townhomes, 180 mid-rise
residential condominium units, and one (1) commercial
condominium unit to be constructed on the Land, along with project amenities
and
other improvements to
be known as
"Tierra del Sol", as more particularly
----------------
described in the
Plans and Specifications, together
with any existing
improvements not to
be demolished. The Condominium will consist of five (5)
buildings (the "Condominium Buildings"), each
having 36 Condominium Units, and
----------------------
will be constructed on the Costa Blanca Land. The Project amenities will
include
a pool
(including a "lazy
river" feature), pool deck, two spa pools, kiddie
pool, pool equipment building, two
pool-side restroom buildings, sports bar and
"beach" area and
will be constructed on the TDS Amenities Land. The townhomes
will consist of
twelve (12) "Monaco" townhouse
buildings consisting of 74
Townhouse Units, and
five "Marbella" townhouse
buildings consisting of 40
Townhouse Units (the
Monaco buildings and the Marbella
buildings hereinafter
referred to as the
"Townhouse Buildings"), and will be constructed on the TDS
-------------------
Town Homes Land. The parking area serving the
Condominium Buildings (up to the
boundary of the
TDS Amenities Land) will be owned by TDS Amenities until they
are deeded to
the master association at or before the time control of
it is
turned over to the owners.
In Balance or in balance: As such
term is defined in Article 11.
------------------------ ----------
Including or including: Including
but not limited to.
----------------------
Interest Rate
Agreement: An Interest Rate Protection Product purchased by
-------------------------
Borrower from Lender, if applicable.
Interest Rate Protection Product: An
interest rate hedging product, such as
--------------------------------
a cap or swap or such other interest rate protection product.
Internal Revenue
Code: The Internal Revenue Code of 1986, as amended from
-----------------------
time to time.
Land: As such term is defined in
Recital A.
---- ---------
Laws: Collectively,
all federal, state and local laws, statutes, codes,
----
ordinances, orders, rules
and regulations, including
judicial opinions or
precedential authority in the applicable jurisdiction.
Late Charge: As such term is defined
in Section 4.6.
----------- -----------
Leases: The
collective reference to all leases, subleases and occupancy
------
agreements affecting the Project or any part thereof now existing
or hereafter
executed and all
amendments, modifications or supplements thereto approved in
writing by Lender.
Lender: As
defined in the
opening paragraph of
this Agreement, and
------
including any successor holder of the Loan from time to time.
Lender's Consultant: An independent
consulting architect, inspector, and/or
------------------
engineer designated by Lender in Lender's sole discretion.
LIBOR Business
Day: A Business Day on which
dealings in U.S. dollars are
--------------------
carried on in the London Interbank Eurodollar Market.
LIBOR Rate:
The rate per annum calculated by
Lender in good faith, which
-----------
Lender determines with reference to the rate per annum (rounded
upwards to the
next higher whole
multiple of 1/16th if such rate
is not such a multiple) at
which deposits in United States dollars are offered by prime banks in the
London
Interbank Eurodollar Market
two LIBOR Business days prior to the day on which
such rate is calculated by the Lender in an amount
comparable to the amount of
such advance and with a maturity equal to the LIBOR Rate Interest Period.
-6-
<PAGE>
LIBOR Rate Interest Period: With
respect to each amount bearing interest at
--------------------------
a LIBOR based rate, a period of one LIBOR Business day, commencing on the date
a
disbursement of Loan proceeds is made, continued, or converted.
LIBOR Rate
Margin: Two and
three-quarters percent (2.75%) (two hundred
-------------------
seventy five (275) basis points) per annum.
Loan: As defined in Recital B.
----
Loan Commitment: That certain
Commitment Letter dated December 1, 2005, and
---------------
executed by Borrower and Lender.
Loan
Documents: The collective
reference to this Agreement, the documents
---------------
and instruments listed
in Section 4.2,
and all the other documents and
instruments entered into from time to time, evidencing or
securing the Loan or
any obligation of
payment thereof or performance of Borrower's or Guarantors'
obligations in connection with the transaction contemplated
hereunder, and any
Interest Rate Agreement (if applicable), each as amended.
Loan
Opening Date: The date of the first disbursement of
proceeds of the
-------------------
Loan.
Major Subcontractor: Any
subcontractor under a Major Subcontract.
-------------------
Major Subcontracts: All subcontracts
between the General Contractor and any
------------------
subcontractors and material
suppliers which provide for an aggregate contract
price equal to or greater than $500,000.00.
Material Adverse
Change or material
adverse change: If, in
Lender's
--------------------------------------------------------
reasonable discretion, the business prospects, operations or financial
condition
of a
person, entity or property has changed in a manner which could
materially
impair the value of Lender's security
for the Loan, prevent timely repayment of
the Loan
or otherwise prevent
the applicable person or entity from timely
performing any of its material obligations under the Loan Documents.
Maturity Date: December 28, 2007,
unless sooner repaid.
------------- ----
Maximum Outstanding Loan Amount: The maximum
principal amount of the Loan,
--------------------------------
at any time outstanding, as set forth in Section 4.1(a).
Maximum Aggregate Loan Amount: As
such term is defined in Section 4.1(a).
-----------------------------
Mortgage: The
Mortgage, Assignment Rents,
Security Agreement and Fixture
--------
Filing, executed by Borrower for the
benefit of Lender securing this Agreement,
the Note, and all obligations of
Borrower in connection with the Loan, granting
a first priority lien on Borrower's fee interest in the Project, subject only
to
the Permitted Exceptions.
Net
Cash Flow: The gross income produced by the Project from
all sources
---------------
(including but not limited to all Net Sale Proceeds (as defined in the
Addendum)
and other sales
and rental activities) reduced by: (a) ordinary and necessary
operating expenses actually
incurred and paid
with respect to the Project
(including amounts paid
to affiliates of Borrowers only if preapproved by the
Lender); (b) reasonable capital expenditures actually made
with respect to the
-7-
<PAGE>
Project (other than
those funded out of
Loan proceeds); and (c) reasonable
reserves for repairs and replacements to the Project (including reserves for
the
condominium association, the homeowner's
association, basic resort services and
reserves under the
Operating Agreement), but only if and to the extent such
reserves are funded
in cash and deposited with the
Lender and pledged to the
Lender as security for payment of the Loan.
Net Sale Proceeds: As such term is
defined in the Addendum.
-----------------
Note: A
promissory note, in the Maximum Outstanding Loan Amount, executed
----
by Borrower and payable to the order of Lender, evidencing the Loan.
Opening of the Loan
or Loan Opening:
The first disbursement of Loan
-----------------------------------------
proceeds.
Operating Account: A deposit account
opened and maintained by Borrower with
-----------------
Lender, to be utilized in the manner set forth in Section 4.1(e).
--------------
Operating Agreement:
That certain Operating Agreement entered into by and
--------------------
between Wright Resort
Villas & Hotels, Inc., and
Sonesta Orlando, Inc. dated
January 29, 2005.
Owner's Contingency:
A Budget Line Item identifying funds to be disbursed
--------------------
to Borrower, upon
approved request, for
the purpose of paying additional,
non-required expenses related
to the Project.
In no event, however, shall
Owner's Contingency be available for distribution until Lender is satisfied
that
the Loan is in balance and sufficient to complete the improvements planned.
Payment Guarantor(s): Malcolm J.
Wright, American Leisure Holdings, Inc., a
--------------------
Nevada corporation, and
TDS Development, LLC,
a Florida limited liability
company.
Payment Guaranty: A guaranty of payment executed by
each Payment Guarantor
-----------------
and pursuant to
which the Payment Guarantors
jointly and severally guarantee
payment of principal, interest and other amounts due under the Loan Documents.
Performance and
Completion Guarantor(s): Malcolm
J. Wright, American
------------------------------------------
Leisure Holdings, Inc.,
a Nevada corporation,
and TDS Development, LLC, a
Florida limited liability company.
Performance and
Completion Guaranty: A
guaranty of performance
and
--------------------------------------
completion, executed by each Performance and Completion Guarantor
and pursuant
to which
the Performance and
Completion Guarantors jointly
and severally
guarantee the lien-free and timely
completion of the Project in accordance with
all provisions of this Agreement and Borrower's obligation
to keep the Loan In
Balance and to pay for all cost overruns.
Permitted Exceptions:
Those matters listed
on Schedule B to the Title
---------------------
Policy to which title to the Project may
be subject at the Loan Opening (as set
forth on
EXHIBIT "B", attached
hereto) and thereafter
such other title
exceptions as Lender may reasonably approve in writing.
Phase 1 Loan: As such term is
defined in Recital B.
------------
Plans and
Specifications: Detailed plans
and specifications for
the
--------------------------
Improvements, as approved
by Lender pursuant to Section 9.1(f), as modified
--------------
hereafter with Lender's
prior written approval
or as otherwise expressly
permitted by this Agreement.
-8-
<PAGE>
Prime Rate:
That interest rate established from time to time by Lender as
-----------
Lender's Prime Rate, whether or not such rate is publicly
announced; the Prime
Rate may
not be the lowest interest rate charged by Lender
for commercial or
other extensions of credit;
Prime Rate Margin: 0 percent (0
basis points) per annum.
-----------------
Pro-Forma Projection:
A pro forma
statement of projected
income and
---------------------
expenses of Project.
Project: The
collective reference to
(i) the Land, together with all
-------
buildings, structures and
improvements located or
to be located thereon,
including the Improvements,
(ii) all rights,
privileges, easements and
hereditaments relating or appertaining thereto, and (iii) all personal
property,
fixtures and equipment required or
beneficial for the operation thereof, all as
contemplated by the Plans and Specifications and the Budget.
Project Equity: As such term is
defined in Section 8.1(a).
-------------- --------------
Project Escrow Account: As such term
is defined in Section 4.1(f).
---------------------- --------------
Required Permits:
Each building permit,
environmental permit, utility
-----------------
permit, land use
permit, wetland permit and any other permits, approvals or
licenses issued by any Governmental authority which are
required in connection
the Construction or operation of the Project.
Reserve Percentage:
<