Sample Business Contracts

REVOLVING LOAN AGREEMENT

By and Among

Tradition Development Company, LLC, a Florida limited liability company,
Horizons St. Lucie Development, LLC, a Florida limited liability company,
Horizons Acquisition 7, LLC, a Florida limited liability company,
and
Tradition Mortgage, LLC, a Florida limited liability company
(collectively, “Borrower”)

and

Core Communities, LLC, a Florida limited liability company
(“Guarantor”)

and

Wachovia Bank, National Association
(“Lender”)

Dated: April 8, 2005

 

TABLE OF CONTENTS

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TABLE OF CONTENTS
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TABLE OF CONTENTS
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TABLE OF CONTENTS
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REVOLVING LOAN AGREEMENT

     THIS REVOLVING LOAN AGREEMENT (the “Loan Agreement”) is made and executed as of April 8, 2005, by and among TRADITION DEVELOPMENT COMPANY, LLC, a Florida limited liability company; HORIZONS ST. LUCIE DEVELOPMENT, LLC, a Florida limited liability company; HORIZONS ACQUISITION 7, LLC, a Florida limited liability company; and TRADITION MORTGAGE, LLC, a Florida limited liability company (hereinafter collectively referred to as “Borrower”), CORE COMMUNITIES, LLC, a Florida limited liability company (“Guarantor”), all located at 10521 S.W. Village Station Drive, Suite 201, Port St. Lucie, Florida 34987, and WACHOVIA BANK, NATIONAL ASSOCIATION, located at 200 East Broward Boulevard, Suite 200, Fort Lauderdale, Florida 33301 (hereinafter referred to as “Lender”).

B A C K G R O U N D:

     A. Borrower and Lender have negotiated a Forty Million and 00/100 Dollar ($40,000,000.00) revolving line of credit loan (“Revolving Loan”) to be used by Borrower for any lawful business activities conducted by Borrower in the normal course of Borrower’s real estate business, including, but not limited to, (i) the acquisition and/or development by Borrower of real property located and being in St. Lucie County, Florida and (ii) issuances of letters by credit by Lender. Subject to the requirements of this Loan Agreement, the Loan will revolve as to the total principal amount of Forty Million and 00/100 Dollar ($40,000,000.00).

     B. The Revolving Loan shall be evidenced by a Revolving Loan Note of even date herewith (“Revolving Note”) in the amount of the Revolving Loan and shall be secured by a Mortgage, Assignment of Rents and Security Agreement (“Mortgage”) initially encumbering that certain real property situate in St. Lucie County, Florida, more particularly described in Exhibit “A” (“Land”) attached hereto and made part hereof, which Land is owned in fee simple by Borrower. (The Land and the Improvements (as defined below) located or to be located thereon are referred to as the “Property”.)

     C. Borrower and Lender wish to enter into this Loan Agreement in order to set forth the terms and conditions of the disbursement of the Loan and other matters with respect thereto.

     NOW, THEREFORE, in consideration of the foregoing, the mutual covenants, representations, warranties and agreements contained herein, the sum of TEN AND 00/100 DOLLARS ($10.00) and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Borrower, Guarantor and Lender agree as follows:

ARTICLE I.

DEFINITIONS

     1. For the purposes hereof, the following terms shall have the meanings described in this Article:

 

          “Application” means Borrower’s application for payment.

          “Appraisal” means the written appraisal report prepared by an independent licensed professional appraiser which has been approved by the Lender. All Appraisals required herein shall be subject to the review of the Lender’s chief appraiser, whose review of the Appraisals must result in findings satisfactory to the Lender, in the Lender’s reasonable discretion.

          “Appraised Value” means the value of the Property or any specific parcel or parcels within the Property, as determined by the Appraisal.

          “Assigned Rights” has the meaning as set forth in Article III, Paragraph 1.

          “Borrower” shall refer collectively to Tradition Development Company, LLC, a Florida limited liability company; Horizons St. Lucie Development, LLC, a Florida limited liability company; Horizons Acquisition 7, LLC, a Florida limited liability company; and Tradition Mortgage, LLC, a Florida limited liability company.

          “Borrowing Base” means the method for determining the availability of funds under the Revolving Loan as set forth in Article V, Paragraph 1.

          “Borrowing Base Report” means the report to be submitted by Borrower to Lender on a monthly basis on the first day of each and every month included within the form attached hereto as Composite Exhibit “C”.

          “Capitalized Lease Obligation” means any Indebtedness represented by obligations under a lease that is required to be capitalized for financial reporting purposes in accordance with GAAP.

          “Closing Date” means the date as of which this Loan Agreement is executed by Borrower and Lender.

          “Collateral” means the Land and other property rights and security as defined in and encumbered by the Mortgage, this Loan Agreement, the UCC-1 Financing Statements and such other security instruments granted by the Borrower to the Lender in connection with the Loan.

          “Commitment” means the commitment letter issued by Lender as of August 18, 2004, and executed by Borrower on August 23, 2004.

          “Commitment Fee” has the meaning set forth in Section VIII, Paragraph 30 of this Agreement.

          “CDD” means any current or future Community Development Districts which are formed or to be formed for any portions of the Property.

          “CDD Bond(s)” means those bonds issued by the CDD to provide for funding for certain infrastructure improvements within the Property.

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          “Core” means Core Communities, LLC, a Florida limited liability company.

          “Cost” means the purchase price paid by Borrower to acquire the Land (or any portion thereof) plus costs and expenses incurred by Borrower in connection with such purchase including, without limitation, interest payments, all of which shall be subject to Bank’s prior written approval which shall not be unreasonably withheld.

          “Declaration(s)” means any and all Declarations of Covenants, Conditions and Restrictions, or any other restrictive covenants governing or imposed solely upon the Property or the Improvements or any portion thereof; including in connection with any property owners or homeowners associations solely governing the Property or the Improvements or any portion thereof.

          “Default” or “Event of Default” means a violation of any term, covenant, or condition hereunder or a Default as defined under any of the other Loan Documents which remains uncured after any applicable grace period.

          “Default Rate” means the interest rate which is three percent (3%) greater than the interest rate stipulated in the Revolving Note.

          “Development Order” means the final development orders or approvals issued for the Land, including those with respect to any DRI approval process.

          “DRI” means a development of regional impact as defined in Chapter 380, Florida Statutes.

          “Due Diligence Documents” means all due diligence documents required to be delivered by Borrower to Lender and described in Exhibit “B” attached hereto and made a part hereof.

          “Environmental Laws” means any and all federal, state, or local statutory or common law relating to pollution or protection of the environment, including without limitation, the Comprehensive Environmental Response, Compensation and Liability Act of 1980 (“CERCLA”), 42 USC ¤ 9601, et seq., the Superfund Amendments and Reauthorization Act of 1986 (“SARA”), Public Law 99-499, 100 Stat. 1613, the Resource Conservation and Recovery Act (“RCRA”), 42 USC ¤ 6901, et seq., state and local laws, as the same may be amended from time to time and all ordinances, regulations, codes, plans, orders, and decrees now existing or in the future enacted, promulgated, adopted, entered or issued, both within and outside present contemplation of the Borrower and Lender, and any common law of nuisance or trespass, and any law or regulation relating to emissions, discharges, releases or threatened releases of Hazardous Substances into the environment (including without limitation, ambient air, surface water, groundwater, land surfaced or subsurface strata) or otherwise relating to the manufacture, processing, distribution, use, treatment, storage, disposal, transport or handling of Hazardous Substances.

          “Financial Covenants” means the financial covenants, conditions and requirements set forth in Article VIII, Paragraph 21 of this Loan Agreement.

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          “Financing Statements” means the UCC financing statements filed in order to perfect Lender’s lien on certain personal property and fixtures as more particularly described therein.

          “Florida Lien Law” means the laws of the State of Florida regarding mechanics’, materialmen’s and suppliers’ liens as provided in Florida Statutes Section 713 et. seq.

          “GAAP” means generally accepted accounting principles in the United States of America in effect from time to time.

          “Gap” means the period of time between the effective date of the commitment for mortgagee title insurance and the recording of the Mortgage.

          “Governmental Authorities” means any local, state, or federal governmental agency, regulatory body or office, or any quasi-governmental office (including health and environmental), or any officer or official of any such agency, office, or body whose consent or approval is required as a prerequisite to the commencement of the construction of the Improvements or to the operation and occupancy of the Improvements or the Land or to the performance of any act or obligation or the observance of any agreement, provision or condition of whatsoever nature herein contained.

          “Guarantor” means Core.

          “Guarantor’s Assets” at any date means the amount which, in accordance with GAAP, would be set forth opposite the caption “total current assets” (or any like caption) on a consolidated balance sheet of the Guarantor at such date.

          “Guarantor’s Debt” at any date means the aggregate principal amount of all Indebtedness of the Guarantor at such date in accordance with GAAP.

          “Guarantor’s Liabilities” at any date means the amount which, in accordance with GAAP, would be set forth opposite the caption “total current liabilities” (or any like caption) on a consolidated balance sheet of the Guarantor at such date.

          “Guaranty” means the Unconditional Guaranty executed by Guarantor in favor of Lender, providing for Guarantor’s payment of all sums due under the Loan Documents and of performance of certain obligations of Borrower thereunder.

          “Hazardous Substances” means any substance or material in violation of an Environmental Law, including, but not limited to, (i) as identified in Section 101(14) of CERCLA, 42 USC ¤ 9601 (14), as the same may be amended from time to time, and in any other Environmental Law, or (ii) determined to be toxic, a pollutant or contaminant, under federal, state or local statute, law, ordinance, rule or regulation or judicial or administrative order or decision, as same may be amended from time to time, and further including but not limited to those defined under state and local laws, as same may be amended from time to time.

          “Improvements” means the site work and infrastructure improvements and other land development to be completed by Borrower on the Land Under Development in accordance

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with the terms and provisions hereof, if any, specifically excluding however, any improvements relating to a CDD.

          “Indebtedness” means: (i) all items which in accordance with GAAP would be included in determining total liabilities as shown on the liability side of a balance sheet of Guarantor as of the date said Indebtedness is to be determined, including, without limitation, Capitalized Lease Obligations; (ii) all obligations which Guarantor has guaranteed under the Loan; (iii) all reimbursement obligations in connection with letters of credit or letter of credit guaranties issued for the account of Guarantor; and (iv) all other obligations of Guarantor.

          “Indemnified Parties” means and includes Lender, its parent, subsidiary and affiliated companies, assignees of any of Lender’s interest in the Loan or the Loan Documents, owners of participating or other interests in the Loan or the Loan Documents.

          “Indemnified Costs” means all actual liabilities, claims, actions, causes of action, judgments, orders, damages (including foreseeable and unforeseeable consequential damages), costs, expenses, fines, penalties and losses (including sums paid in settlement of claims and all consultant, expert and legal fees and expenses of Lender’s attorneys to the extent Lender is a prevailing party), including those incurred in connection with any investigation of site conditions or any remedial, removal or restoration work, of any resulting damages, harm or injuries to the person or property of any third parties or to any natural resources, with respect to the Property to the extent of a Default and Lender incurs expenses contemplated under the Loan Documents.

          “Initial Borrowing Base Report” means the description of the Maximum Advance Availability, as of the date hereof, for each Parcel as described in Article VII, Section 1 hereof, a copy of which is attached as Composite Exhibit “C”.

          “Inspector” means the architectural or engineering firm or such party(s) or such representative of Lender which Lender shall designate to perform various services on behalf of Lender. The services to be performed by Lender’s Inspector shall include the issuance of reports and certifications solely for the benefit of Lender and shall not impose upon Lender any obligation to make inspections, or to correct or require any other person to correct any defects, or to notify any person with respect to such defects, review of the Plans for any Improvements and all proposed changes to them, periodic inspections of construction work of the Improvements, if any, for conformity with the Plans.

          “Inspection Agreement” means the tri-party agreement among Lender, Borrower and Inspector providing for the services of, and payment by Borrower to, the Inspector.

          “Inventory Report” means the report to be submitted by Borrower to Lender on a monthly basis on the first day of each and every month included within the form attached hereto as Composite Exhibit “C”.

          “LTC” or “Loan to Cost” means, as determined on any date, the percentage arrived at by dividing (i) the outstanding principal balance of the Loan on such date by (ii) the Cost of the Property.

          “LTV” or “Loan to Value” means, as determined on any date, the percentage

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arrived at by dividing (i) the outstanding principal balance of the Loan on such date by (ii) the Appraised Value of the Property.

          “LUD” or “Land Under Development” means Land owned by Mortgagor which is being developed by Mortgagor with Improvements.

          “Land” means the real property described in Exhibit “A” attached hereto and any real property subsequently encumbered by the Loan by modification and spreader agreement.

          “Lender” means Wachovia Bank, National Association, its successors and/or assigns.

          “Letter of Credit” means a standby letter of credit issued by Lender pursuant to the terms of this Loan Agreement for the account of Borrower, as the same may be renewed, modified, amended or restated from time to time in the manner provided therein, which shall serve as performance bonds for Borrower’s development of real property. Draws under the Letters of Credit shall be secured by the Mortgage as provided herein and in the Mortgage and the Maximum Advance Availability under the Borrowing Base shall be reduced by the amount of the Letter of Credit issued until returned.

          “Licenses and Development Rights” means any right, title and interest now owned or hereafter acquired by Borrower in and to the following solely with regard to the Land (i) all development approvals, plat approvals, site plan approvals, density and similar rights, rights under development orders in connection with the development of regional impact solely in connection with the Land, building permits, other governmental approvals, licenses, and other consents and approvals which it may now or hereafter own solely with respect to or in connection with the Property; (ii) all plat drawings, site plans, and other drawings, plans and specifications for the Property and Improvements; (iii) all warranties and guaranties covering any furniture, equipment, machinery, building supplies and materials, appliances, fixtures and other property now or hereafter located on or placed upon the Property or related to the Improvements located on the Land, including, without limitation, air conditioning, heating and other appliances and equipment; (iv) any other governmental licenses, permits, approvals, allocations, contract rights related to the design, development or construction of the Improvements, and similar matters and documents obtained or to be obtained in the future which are necessary or appropriate for the construction, operation and management of any Improvements located on the Land; (v) all development agreements, agreements with utility companies, agreements with governmental authorities and similar agreements solely related to the Land; (vi) all rights in favor of Borrower or the Land under any Community Development Districts (“CDD”) or agreements with any CDD to the extent assignable; and (vii) any and all permits, licenses, allocations, approvals, certificates and consents heretofore or hereafter issued by any governmental or private authority or agency relating solely to the Land or to any Improvements or the Plans and Specifications thereof, naming Borrower, and all of Borrower’s right, title and interest in any to any subcontracts or agreements for services, labor or materials pertaining to any Improvements, and all claims and rights with respect to non-performance or breach of said contracts and agreements.

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          “Loan” means the Revolving Loan.

          “Loan Agreement” means this Agreement.

          “Loan Documents” means the Commitment, this Loan Agreement, the Notes, any funding agreement, any “Application and Agreement for Irrevocable Standby Letter(s) of Credit” entered into by Lender and Borrower with respect to a Letter of Credit, the Mortgage, the other collateral assignments, the Guaranty, the Financing Statements, and any other document or writing executed in connection therewith or in furtherance thereof, whether entered into simultaneously herewith or at any time hereafter.

          “Loan Maturity Date” or “Maturity Date” means that certain date twenty-four (24) months from and after the Closing Date, as may be extended as set forth in the Note.

          “Lot” means any plotted Lot within the Property.

          “Lot Contracts Report” means the report to be submitted by Borrower to Lender on a monthly basis on the first day of each and every month included within the form attached hereto as Composite Exhibit “C”.

          “Management and Leasing Agreements” means (i) any and all management agreements executed by Borrower with any third party or affiliate of either Borrower or either Guarantor to engage in management activities in connection with the Property or the Improvements; and (ii) any and all leasing agreements executed by Borrower with any third party or affiliate of either Borrower or either Guarantor to engage in leasing or sales activities in connection with the Property or the Improvements.

          “Maximum Advance Availability” means the amount available for each Sub-limit Classification available for funding under the Borrowing Base in accordance with Section 1 of Article V hereof which amount shall be reduced by the face amount of a Letter of Credit.

          “Maximum Debt” means Guarantor’s Debt less (i) customer deposits, and (ii) subordinated debt due to shareholders of Guarantor.

          “Mortgage” means the Mortgage, Assignment of Rents and Security Agreement of even date herewith executed by Borrower for the benefit of Lender encumbering the Property, and any extensions, modifications, renewals or replacements thereof.

          “Mortgagor” means Tradition Development Company, LLC, a Florida limited liability company; Horizons St. Lucie Development, LLC, a Florida limited liability company; Horizons Acquisition 7, LLC, a Florida limited liability company; and/or Tradition Mortgage, LLC, a Florida limited liability company, as the case may be.

          “Notes” means the Revolving Note executed by Borrower in favor of Lender as well as any promissory note, sub-note, or other notes issued by Borrower in substitution, replacement, extension, future advance, amendment or renewal of the Note or any such promissory note or notes or as required herein.

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          “Permitted Encumbrances” means those liens, encumbrances, easements and other matters approved by Lender as acceptable exceptions to Schedule B-Section 2 of the Title Policy, including, but not limited to, taxes and assessments not yet due and payable for the year of closing, and matters contemplated under the Loan Documents, including CDDs created with respect to the Land.

          “Parcels” means portions of the Land as described by separate, discrete legal descriptions or by a separately recorded plat, including as set forth in the Initial Borrowing Base Report.

          “Plans” or “Plans and Specifications” means plans and specifications for the construction of the Improvements submitted to and approved by Lender from time to time and including such amendments thereto as may from time to time be made by Borrower and approved by Lender, such approval not to be unreasonably withheld.

          “Property” means the Land and the Improvements located or to be located on the real property described in Exhibit “A” attached hereto and made a part hereof encumbered by the Mortgage and any Land and Improvements subsequently encumbered by the Mortgage, and any rights, other property, and appurtenances as defined, described or identified in the Mortgage to be used as Collateral for the Loan.

          “Requisition” means Lender’s form of loan requisition, completed by Borrower, evidencing Borrower’s draw request.

          “Revolving Loan” means the Forty Million and 00/100 Dollar ($40,000,000.00) revolving line of credit loan to be funded pursuant to the Borrowing Base as described in this Loan Agreement.

          “Site Plan” means collectively the site plans for the Improvements, approved by the applicable Governmental Authorities, as same may be amended from time to time with Lender’s approval which shall not be unreasonably withheld.

          “Sub-Limit Classification(s)” means the type of property to be used in determining the availability under the Borrowing Base as set forth in Article V hereof.

          “Tangible Net Worth” means Guarantor’s Assets less Guarantor’s Liabilities plus subordinate and/or subordinated debt payable to Guarantor’s shareholders.

          “Title Commitment” means the mortgagee title insurance commitment satisfying the requirements of this Loan Agreement.

          “Title Insurer” means title insurance underwriter satisfactory to Lender.

          “Title Policy” means the mortgagee title insurance policy issued pursuant to the Title Commitment satisfying the requirements of this Loan Agreement.

          “Utilities” means services necessary for the construction of the Improvements and the operation thereof for their intended purpose are available at the boundaries of the Land,

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including water supply, storm and sanitary sewer facilities, electric, telephone facilities, cable television, and trash/dumpster services.

          “Work in Progress Report” means the report to be submitted by Borrower to Lender on a monthly basis on the first day of each and every month included within the form attached hereto as Composite Exhibit “C”.

     2. Capitalized terms not defined in this Loan Agreement shall have the meanings ascribed to them in the Mortgage, Notes, or other applicable Loan Documents.

ARTICLE II.

LOAN DOCUMENTS

     As a condition to Closing and prior to and as a condition of any disbursement of Loan funds hereunder, Borrower shall execute and deliver, or cause to be executed and delivered to Lender the Loan Documents to be executed by Borrower and/or Guarantor (the “Loan Documents”), and due diligence documents to be delivered by Borrower and/or Guarantor on the Land which Borrower utilizes as part of the Borrowing Base (collectively, the “Due Diligence Documents”), including as described on Exhibit “B” attached hereto and made a part hereof, all in form and substance reasonably satisfactory to Lender.

     All of the Loan Documents and Due Diligence Documents shall be in form and content reasonably satisfactory to the Lender, and shall comply with all of the requirements set forth in this Loan Agreement.

ARTICLE III.

SECURITY AGREEMENTS

     1. In addition to the security interests granted pursuant to the Mortgage and the other Loan Documents, Borrower hereby collaterally assigns, transfers, sets over and grants a security interest to Lender, its successors and assigns, in and to the following:

          (a) Design and Construction Contracts, Plans and Specifications. All of its right, title and interest in and to: (i) all construction contracts now or hereafter entered into by Borrower with various contractors (hereinafter each such are referred to as a “Contractor”) for the various Improvements to be constructed upon the Land, and all addenda, modifications and amendments thereto (“Construction Contracts”);

          (b) Developer’s Rights. All of its rights, title and interest as developer or declarant in and to the Declarations to the extent assignable in accordance with the terms and conditions of the Declarations.

          (c) Management and Leasing Agreements. All of its rights, title and interest in and to the Management and Leasing Agreements.

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          (d) Licenses and Development Rights. All of its rights, title and interest in and to the Licenses and Development Rights.

          (e) All of its rights, title and interest in and to all current and future purchase and sale agreements with third party purchasers (collectively, “Purchase Agreements”).

     Hereinafter the Construction Contracts, Declarations, Management and Leasing Agreements, Licenses and Development Rights, and Purchase Agreements are referred to as the “Assigned Rights”.

     2. Borrower covenants, warrants and represents to Lender that with regard to the Assigned Rights currently held by Borrower (and for any Assigned Rights subsequently assigned to Lender as of the date of such assignment) (i) Borrower has all lawful right, title and interest to the Assigned Rights (if any), and has the right to make this assignment (to the extent the Assigned Rights are assignable), and (ii) Borrower has not assigned nor shall it assign to any other person or entity any interest in such Assigned Rights and (iii) the Assigned Rights are in full force and effect and there are no defaults by Borrower thereunder or by any other party thereto. Borrower warrants and represents that Lender shall not be under any obligation to perform any of the obligations of Borrower under the Assigned Rights. Nothing contained herein shall be construed to impose any liability upon Lender by reason of the assignment granted hereby until Lender exercises dominion and control with respect thereto, and Borrower shall indemnify, defend and hold Lender harmless from and against any and all claims, damages, liabilities, fines and expenses (including but not limited to reasonable attorney’s fees and costs) arising from or related to this assignment or under any of the Assigned Rights until Lender exercises dominion and control with respect thereto. Borrower shall deliver to Lender prompt written notice of any and all defaults or events which, with the giving of notice and/or the passage of time will become defaults by either Borrower or any third party under any Assigned Rights, and shall deliver copies of all written notices, demands and material communications between Borrower and any third party under any Assigned Rights. Borrower shall obtain any necessary consents or joinders necessary to effectuate the Assigned Rights.

     3. These assignments shall be in full force and effect as of the date hereof. Notwithstanding that this assignment is effective immediately, so long as there shall exist no Default by Borrower of this Loan Agreement or any other Loan Document which has not been cured within an applicable cure period and the cure accepted by Bank, Borrower shall have the right to take all action with respect to the items and matters assigned hereby. These assignments shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns. Borrower acknowledges that the making of the Loan by Lender to Borrower shall be made by Lender in full reliance upon these assignments. This instrument is for the sole benefit of Lender and shall not be construed for the benefit of any third party or parties.

     4. Upon delivery of written notice of Default to Borrower (after expiration of any applicable cure period), Lender shall have the right in its sole discretion to take in its name or in the name of Borrower or otherwise, such action as Lender may at any time or from time to time reasonably determine to be necessary to cure any Default of Borrower under the Assigned Rights, but under no circumstances shall Lender be obligated to take such action. Lender shall incur no liability on account of any action taken in good faith by it or on its behalf or otherwise

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hereunder, whether or not the same shall prove to be improper, inadequate or invalid in whole or in part, and Borrower agrees to protect, defend, indemnify and hold Lender harmless from and against any and all loss, cost, liability or expense, including, but not limited to attorneys’ fees and expenses, in connection with any such action or actions except for Lender’s wrongful acts or gross negligence. These assignments shall constitute Borrower’s irrevocable direction to and full authority for third parties to act at Lender’s written direction, notice or demand and to otherwise perform on Lender’s behalf under the Assigned Rights after a Default exists under the Loan. Third parties shall be fully protected by Borrower in their reliance upon and compliance with any written request, notice or demand made by Lender with respect to the Assigned Rights or for performance of any undertaking thereunder, and shall have no right or duty to inquire as to whether any Default under the Loan Agreement or the other Loan Documents has actually occurred or is then existing.

     5. Borrower hereby irrevocably constitutes and appoints Lender as its true and lawful attorney-in-fact, empowered to act in Borrower’s name or in Lender’s name or otherwise, in order to enforce all rights of Borrower under the Assigned Rights (i) during a Default or (ii) after a Default has occurred and been cured but said cure has not been accepted by Lender. This power of attorney, being coupled with an interest, is irrevocable.

ARTICLE IV.

CLOSING AND INITIAL DISBURSEMENT

     1. The Closing of the Loan, and funding of the proceeds of this Loan which are approved by the Lender for any initial funding are conditioned upon, and such proceeds of the Loan shall be funded subsequent to, the following:

          (a) Execution and/or delivery of all Loan Documents and Due Diligence Documents such other documents as Lender and Lender’s counsel may require to insure that the Lender has a valid first lien on the Property which constitutes the Borrowing Base used by Lender to fund this Loan Agreement and as necessary or appropriate to effectuate the terms of this Loan Agreement.

          (b) Receipt by Lender of satisfactory evidence of applicable insurance required pursuant to the Loan Documents.

          (c) Receipt by Lender of the marked-up Title Insurance Commitment, insuring Lender’s Mortgage, which marked-up commitment must be approved by Lender’s counsel together with all required reinsurance and co-insurance agreements, required endorsements and coverages.

          (d) Receipt by Lender of evidence satisfactory to Lender and Lender’s counsel of the Borrower’s and Guarantor’s fulfillment of any other condition to funding as set forth in this Loan Agreement.

          (e) Borrower and Guarantor are in full compliance with the Loan Documents and all warranties and representations of the Borrower and Guarantor are true and correct.

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          (f) Written confirmation from Borrower that the applicable Parcels to be included in the Borrowing Base have the appropriate approvals, permits, licenses and Improvements required (if any) to qualify for the applicable Sub-Limit Classification set forth in Article VII, Section 1 hereof and in the Initial Borrowing Base Report.

ARTICLE V.

LOAN FUNDING

     1. Borrowing Base. Eligibility for funding under the Loan shall be determined under a “Borrowing Base” formula calculated based on the Sub-Limit Classifications (“Sub-Limit Classification(s)”) set forth in the chart below (“Borrowing Base Matrix”), with each such Sub-Limit Classification referred to in this Loan Agreement (including without limitation in calculating the Maximum Advance Availability by the letter reference in the left-hand column of the chart below). Each such Sub-Limit Classification shall be a sublimit under the Revolving Loan for that category up to the referenced “Maximum Advance Availability” as shown in the Borrowing Base Matrix as may be combined with other Sub-Limit Classifications. The Maximum Advance Availability under the Borrowing Base shall be the value, or cost, as applicable, of each Sub-Limit Classification set forth below multiplied by the applicable Advance Rate as noted in the Borrowing Base Matrix, which results in the aggregate Margined Value (as hereinafter defined). “Margined Value” means the appraised value or cost, if applicable, of the applicable portion of the Mortgaged Property multiplied by the applicable Advance Rate for the particular Sub-Limit Classification as set forth below.

     2. Eligibility Limitations Under Borrowing Base. Eligibility under the Borrowing Base will be further limited as follows:

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          (a) For “Undeveloped Land” owned by the Borrower (Sub-Limit Classification A), eligibility will be limited by the following:

(i) Undeveloped Land identified for use as golf course, amenities, parks, retention, preserve or other non-development uses for sale or rental use, or any other property designated as non-master planned community or property to be deeded to a master property owners association, an improvement district or a CDD other third party, is not eligible for the Borrowing B