SECOND AMENDMENT TO LOAN AGREEMENT
This Second Amendment to Loan Agreement (this "Second Amendment") is
entered into as of the 4th day of October, 1996 between the Government
Development Bank for Puerto Rico, as lender ("GDB") and El Conquistador
Partnership, L.P., as borrower (the "Borrower").
RECITALS
1. GDB and the Borrower entered into that certain Loan Agreement dated
February 7, 1991, as amended by that certain First Amendment to Loan
Agreement dated May 5, 1992 (collectively, the "Loan Agreement"), with
respect to the construction of the El Conquistador Resort and Country
Club (unless otherwise defined herein, all capitalized terms used in
this Second Amendment shall have the meanings assigned to the same in
the Loan Agreement).
2. GDB has agreed to loan to Borrower an additional $6,000,000.00, as
revolving credit facility, subject to the terms and conditions set
forth below.
NOW, THEREFORE, in consideration of the mutual covenants contained herein
and for other good and valuable consideration the receipt and sufficiency of
which is hereby acknowledged, the parties hereto hereby agree as follows:
1. The following definitions are hereby added to Article 2 of the Loan
Agreement:
(a) "Accounts Receivable" shall mean all of the Borrower's present
and future rights to payment with respect to the operation of the
Improvements,
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including, without limitation: (i) goods provided or sold and
services rendered, including, without limitation, merchandise or
inventory sold or leased; (ii) rental of rooms, ballrooms and
other areas that comprise the hotel portion of the Improvements,
or other proceeds therefrom; (iii) food and beverage operations
or other hotel services with respect to the Improvements; and
(iv) any proceeds of the foregoing, including, without
limitation, all of the Borrower's rights to receive payment from
any consumer credit or charge card organization or entity and all
substitutions therefor and proceeds thereof (whether cash or
non-cash, movable or immovable, tangible or intangible) received
upon the sale, exchange, transfer, collection or other
disposition or substitution thereof. The foregoing definition
shall not include rights to payments arising from Borrower's: (a)
casino operations; (b) sale or rental of assets outside the
ordinary course of business; or (c) rentals or concession fees
arising from the lease or concession of commercial or retail
space.
(b) "Advance" shall mean individually and collectively the proceeds
of the Revolving Loan delivered to the borrower by GDB pursuant
to Section 4.7(a) hereof.
(c) "Assignment of Accounts Receivable" shall mean that certain
Constitution of Assignment of Accounts Receivable executed
pursuant to Section 4.7 and forming part of the Security.
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(d) "Credit Facility" shall mean that certain loan in the amount of
$8,000,000 from GDB to Kumagai Caribbean, Inc. and WKA El Con
Associates as evidenced by that certain Credit Facility Loan
Agreement and the other Credit Facility Loan Documents.
(e) "Credit Facility Loan Agreement" shall mean that certain Credit
Facility Loan Agreement dated May 5, 1992 between GDB and Kumagai
Caribbean, Inc. and WKA El Con Associates, evidencing, in part,
the Credit Facility.
(f) "Credit Facility Loan Documents" shall mean the Credit Facility
Loan Agreement and all other agreements, notes, documents and
instruments delivered by Borrower pertaining to the Credit
Facility as hereafter renewed, amended or supplemented from time
to time.
(g) "Credit Facility Mortgage" shall mean that certain Mortgage in
the amount of $6,000,000, from the Borrower in favor GDB as per
Deed No. 6 executed in San Juan on May 5, 1992 before Eugenio
Otero Silva and recorded at page 207 of volume 353 of Fajardo,
property no. 15204, fourth and last inscription, which secures,
in part, the Credit Facility.
(h) "Mortgage Note" shall mean that certain Mortgage Note in the
amount of $6,000,000 from Borrower in favor of GDB given in
connection with the Revolving Loan Mortgage. For the purposes of
Article 10 and
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Article 11, the term "Note" or "Notes" shall also be deemed to
refer to the Mortgage Note.
(i) "Palominos Revolving Loan Mortgage" shall mean the leasehold
mortgage in form reasonably satisfactory to GDB, made or to be
made by Borrower upon its lease hold interest in Palominos Island
Property, to be encumbered in favor of GDB to secure the payment
of the Revolving Loan, creating a third priority Lien on the
Palominos Island Property in the principal amount of $120,000.00.
(j) "Palominos Mortgage Note" shall mean that certain Note in the
amount $120,000 from Borrower in favor of GDB, secured by with
the Palominos Revolving Loan Mortgage. For the purposes of
Article 10 and Article 11, the terms "Note" or "Notes" shall also
be deemed to refer to the Palominos Mortgage Note. For the
purposes of Article 10 and Article 11, the term "Note" or "Notes"
shall also be deemed to refer to the Palominos Mortgage Note.
(k) "Permitted Loan Limit" shall mean the amount of $6,000,000.
(l) "Revolving Loan" shall mean that certain Revolving Loan up to the
Permitted Loan Limit which shall be advanced, from time to time,
under Section 4.7 hereof. For the purposes of Article 3 and
Sections 8.9 and 8.10 only, the term "Loan" shall also be deemed
to refer to the Revolving Loan and for the purposes of Article 9
and Article 10 the term "GDB
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Loan" shall also be deemed to refer to the Revolving Loan.
(m) "Revolving Loan Closing" shall mean the execution and delivery of
the Second Amendment and all other Revolving Loan Documents,
which Revolving Loan Closing shall take place at the offices of
GDB or at such other place as the parties may choose.
(n) "Revolving Loan Closing Date" shall mean October 4, 1996 by which
date the Revolving Loan Closing Date shall have occurred. For the
purposes of Article 3 only, the term "Closing Date" shall be also
deemed to refer to the Revolving Loan Closing Date.
(o) "Revolving Loan Documents" shall mean the Revolving Note, the
Mortgage Note, the Palominos Mortgage Note, the Revolving Loan
Mortgage, the Assignment of Accounts Receivable, the Second
Amendment, and any and all other agreements, documents and
instruments delivered by or on behalf of Borrower pertaining to
the Revolving Loan pursuant to the terms of the Second Amendment,
as hereafter renewed, amended or supplemented from time to time.
The Revolving Loan Documents shall be deemed to be included
within the definition of the Loan Documents.
(p) "Revolving Loan Interest Rate" shall be equal to that certain
annual rate resulting by adding 100 basis points to the LIBOR
Rate for a (3) month period.
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(q) "Revolving Loan Maturity Date" shall mean October 31, 1997, or
such earlier date as GDB shall declare the entire principal sum
due and payable in the exercise of its Rights under Article 10
hereof.
(r) "Revolving Loan Mortgage" shall mean the mortgage, deed of trust
or similar security agreement in form reasonably satisfactory to
GDB, made or to be made by Borrower upon the Premises (excluding
the Palominos Island Property), to be encumbered in favor of GDB
to secure the payment of the Revolving Loan, creating a third
priority Lien on the premises in the principal amount of the
Permitted Loan Limit, encumbering the Premises, including all
buildings, improvements, fixtures and personal property presently
located thereon and all buildings and improvements to be erected
and constructed thereon, if any, and all fixtures and personal
property owned by Borrower to be placed therein.
(s) "Revolving Loan Obligations" shall mean Borrower's obligations
under all of the Revolving Loan Documents, including, without
limitation, all present and future indebtedness, obligations and
liabilities, and all renewals and extensions thereof, or any part
thereof, now or hereafter owed to GDB by Borrower arising from,
by virtue of, or pursuant to any Revolving Loan Document,
together with all interest accruing thereon and costs, expenses
and attorneys' fees incurred in the enforcement or collection
thereof, whether such indebtedness, obligations and liabilities
are
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direct, indirect, fixed, contingent, determinate, undeterminate,
joint, several or joint and several. The Revolving Loan
Obligations shall be deemed to be included within the
Obligations.
(t) "Revolving Loan Pledge Agreement" shall mean that certain Pledge
Agreement to be executed by Borrower in favor of GDB pursuant to
Section 4.7 and forming part of the Security.
(u) "Revolving Loan Secondary Rate" shall mean that certain rate of
interest that shall accrue ont he unpaid principal outstanding
balance of the Revolving Loan, as the same may exist from time to
time, from and after a Default or an Event of Default has
occurred hereunder which interest rate shall be 500 basis points
above the Revolving Loan Interest Rate.
(v) "Revolving Loan Security" shall have the meaning described in
Section 4.7(g) hereof. For the purposes of Article 3 and Section
8.12 hereof, the term "Security" shall be also deemed to refer to
Revolving Loan Security.
(w) "Revolving Loan Security Documents" shall mean those certain
Revolving Loan Documents listed in Section 4.7(g) attached
hereto. The Revolving Loan Security Documents shall be deemed to
be included within the definition of Security Documents.
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(x) "Revolving Loan Title Policy" shall mean that certain Title
Policy issued by the Title Insurer pursuant to Section 4.7.
(y) "Revolving Note" shall collectively mean that certain note
evidencing the Revolving Loan from Borrower in favor of GDB which
shall in no event exceed the aggregate amount of the Permitted
Loan Limit. For the purposes of Article 10 and Article 11, the
term "Note" or "Notes" shall also be deemed to refer to the
Revolving Note.
(z) "Revolving Period" shall mean that certain period commencing on
the Revolving Loan Closing Date and ending on the Revolving Loan
Maturity Date.
(aa) "Second Amendment" shall mean that certain Second Amendment to
Loan Agreement dated as of the Revolving Loan Closing Date
between GDB, as lender, and Borrower.
2. A new Section 4.7 is hereby added to the Loan Agreement as follows:
4.7 Revolving Loan.
(a) Subject to the terms and conditions hereof, and relying on the
representations, covenants and warranties of the Borrower
contained herein, GDB agrees, from time to time, during the
Revolving Period to lend to the Borrower under the Revolving Loan
upon its request up to the aggregate principal amount of the
Permitted Loan Limit for the
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Borrower's working capital needs for the operation of the
Premises. During the Revolving Period, the Borrower shall be
entitled to receive the entire proceeds of the Revolving Loan in
one or more Advances pursuant to this Section 4.7 hereof, except
as otherwise specifically set forth in this Agreement. After the
expiration of the Revolving Loan Period, the Borrower shall not
be entitled to receive any further Advance. The Revolving Loan
may revolve during the Revolving Period; accordingly, during the
Revolving Loan Period, the Borrower may borrow up to the
Permitted Loan Limit, repay all or any portion of such principal
amount, and re-borrow up to the Permitted Loan Limit, subject to
the terms and conditions set forth herein.
(b) The Revolving Loan shall be evidenced by the Revolving Note and
shall be due and payable as required by Section 4.7(k). The
Borrower shall not be liable under the Revolving Note except with
respect to funds actually advanced to the Borrower by GDB. The
Revolving Note shall bear interest from the date thereof on the
unpaid principal balance thereof, from time to time outstanding,
at a fluctuating interest rate equal to the Revolving Loan
Interest Rate.
(c) (i) From and after the Revolving Loan Maturity Date, (ii) upon
the failure of Borrower to pay any interest within (10) days
after such interest is due with respect to the Revolving Loan
prior to the occurrence of any Default or Event of Default, or
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(iii) upon the occurrence of any Default or Event of Default,
interest shall accrue on the unpaid balance of the Revolving Loan
and, to the extent permitted by law, on all accrued but unpaid
interest thereon as of such date, at the Revolving Loan Secondary
Rate. Such interest shall continue to accrue at the Revolving
Loan Secondary Rate until (x) the date of payment in full of all
principal and accrued but unpaid interest on the Revolving Loan,
if accelerated, (y) if applicable, such unpaid interest shall
have been paid, or (z) such Default or Event of Default has
otherwise been cured as may be permitted pursuant to the terms of
this Agreement.
(d) On the Revolving Loan Closing Date hereof and upon satisfaction
of the conditions precedent set forth in Sections 4.7(i) and (j)
below, GDB shall disburse, on behalf of the Borrower, a portion
of the proceeds of the Revolving Loan as may be necessary to pay
off the existing credit facility in favor of Scotia bank de
Puerto Rico in the amount of $5,200,000 and to cover all costs
and expenses incident to the closing of the transactions
contemplated hereby, including, without limitation, and any and
all recording charges/taxes or fees in connection therewith,
which shall all be set forth on a closing statement to be signed
by the parties hereto. Notwithstanding the foregoing, the
attorneys' fees and costs of GDB's legal counsel that is set
forth on the closing statement described above may be paid by
Borrower after the Revolving Loan Closing
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Date, but no later than February 15, 1997. In addition to the
foregoing, the Borrower shall also pay to GDB on or before
February 15, 1997, the amount of $54,224.32, representing a
portion of the costs and expenses incurred by GDB for various
accounting audits of the Premises. After the initial Advance and
upon continued satisfaction of the conditions precedent as set
forth in Section 4.7(j) below, the Borrower shall be entitled to
receive further Advances, provided, however, that the aggregate
amount of outstanding Advances shall never exceed the amount of
the Permitted Loan Limit.
(e) The Borrower shall give GDB written or telephonic notice of any
requested Advance hereunder, but no more than once per month. GDB
shall have no duty or obligation to verify or confirm the
authority of the person of the Borrower requesting any such
Advances if that person identifies himself as an employee of the
Borrower. GDB shall make each Advance hereunder provided that (i)
the Permitted Loan Limit would not be so exceeded, (ii) there has
not occurred a Default or Event of Default on the date proposed
by the Borrower therefor (but not later than two (2) business
days after the receipt of said request for an Advance), and (iii)
Borrower has complied with the terms of this Second Amendment and
the other provisions of the Loan Agreement (it being agreed that
in the event Borrower is not in compliance with the terms of this
Second Amendment or the other provisions of the Loan Documents, a
Default or Event of Default
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is not required to occur before GDB is not obligated to make any
Advance).
(f) In consideration of GDB making the Revolving Loan, the Borrower
agrees to pay to GDB a commitment fee equal to $45,000,
equivalent to three-quarters of one(1) percent (3/4%) of the
Revolving Loan Limit, such fee to be paid on or before February
15, 1997, otherwise, GDB shall not be obligated to make any
further Advances and, at GDB's election, which may be exercised
in GDB's sole and absolute discretion, the failure to pay the
same may be deemed to be an Event of Default.
(g) As security for the Revolving Loan and the performance and
observance of all of the obligations, covenants and agreements of
the Borrower under the Revolving Loan, the Borrower shall
deliver, or cause to be delivered, the following collateral to
GDB (the "Revolving Loan Security"), all of which shall be in
form and substance acceptable to GDB in GDB's sole and absolute
discretion:
(1) The Pledge of the Mortgage Note and Palominos Mortgage Note
secured by the Revolving Loan Mortgage and Palominos
Revolving Loan Mortgage, respectively, pursuant to the
Revolving Loan Pledge Agreement.
(2) Mortgage Note.
(3) Palominos Mortgage Note.
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(4) Revolving Loan Mortgage.
(5) Palominos Revolving Loan Mortgage.
(6) The Assignment of Accounts Receivable creating a first lien
priority interest in favor of GDB in the Accounts
Receivable.
(7) Subordination by GDB of the Credit Facility Mortgage to the
Revolving Loan Mortgage.
(8) Unconditional Guarantees of the Revolving Loan from Kumagai
Caribbean, Inc. and WKA El Con Associates in favor of GDB.
(9) The Revolving Loan Title Policy, showing the Revolving Loan
Mortgage as a third priority lien and the Palominos
Revolving Loan Mortgage as a third (3rd) priority leasehold
lien.
(10) An update of the descriptions of all of the Security pledged
to GDB under (and as defined in) the Loan Agreement and
Facility Loan Agreement.
(11) Such other Revolving Loan Security Documents as Borrower may
deem necessary with respect to the Revolving Loan, in GDB's
sole and absolute discretion.
(h) The Borrower hereby agrees that the Security Documents (excluding
the Revolving Loan Security Documents) shall be deemed to be
additional
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collateral to secure the performance of the Revolving Loan
Obligations, and none of the foregoing security shall be deemed
to be released from the applicable collateral unless and until
all obligations under the Revolving Loan have been paid in full.
In furtherance of the foregoing, (i) the failure to pay any
principal or interest due under the Credit Facility Loan
Documents within ten (10) days after the same is due or (ii) the
occurrence of any "Event of Default" under the Credit Facility
Loan Agreement and acceleration of the Credit Facility or
commencement of proceedings to foreclose upon any collateral
securing the Credit Facility by reason of such Event of Default,
shall, at GDB's option, also be deemed to be a Default or Event
of Default after the giving of notice and expiration of the
applicable grace period under Section 10.1(a) of this Agreement.
(i) The obligation of GDB to make the initial Advance under the
Revolving Loan is subject to the following conditions precedent
(it being understood that the conditions set forth in Article 7
hereof shall not be applicable to GDB's obligation to make
Advances):
(1) All Revolving Loan Documents in form and substance
acceptable to GDB, in GDB's sole and absolute discretion,
shall have been executed and delivered to GDB, including,
without limitation, the following:
(a) Revolving Loan Security;
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(b) Second Amendment;
(c) Consent to Loan Agreement and Assignment of Accounts
Receivable and Subordination of Assignment of Accounts
Receivable from The Bank of Tokyo-Mitsubishi, Ltd.;
(d) Consent of GDB to the Revolving Loan and the pledge of
the collateral under the Revolving Loan Documents as
required by the terms of the Loan and the Credit
Facility;
(e) First Amendment to Subordination and Standstill
Agreement between, among others, Bank of Tokyo -
Mitsubishi Bank, Ltd., and GDB with respect to the
Revolving Loan;
(f) GDB shall receive the favorable written opinion of
counsel to Borrower, dated as of the Revolving Loan
Closing Date, with respect to such matters as GDB may
require;
(g) Such additional supporting documents as GDB may deem to
be necessary, in GDB's sole and absolute discretion.
(2) A Current unaudited balance sheet of Borrower certified to
be true and correct by the chief financial officer of
Borrower shall have been delivered to GDB.
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(3) The conditions set forth in Sections 6.1 (t)- (w) hereof
shall be satisfied.
(4) [Intentionally Deleted].
(5) The conditions precedent set forth in Section 4.7(j) below
shall also be satisfied.
(6) GDB shall have received evidenced acceptable to GDB that the
partners of the Borrower have loaned or caused to be loaned
on behalf of the Partners of Borrower an amount of $800,000
to the Borrower as an unsecured loan toward working capital
for the operation of the Premises for the period of August
and September, 1996 (the "Borrower Loan").
(j) The obligations of GDB to lend amounts under the Revolving Loan
and to make the initial Advance and all other Advances, from time
to time, thereunder, are subject to the following additional
conditions precedent:
(1) The representations and warranties set forth in the
Revolving Loan Documents (excluding Sections 4(a) through
(f) of this Second Amendment) and in Article 3 of the Loan
Agreement (except for Sections 3.2, 3.6, 3.8, 3.15(b), 3.17,
3.20, 3.22, 3.25 and 3.26) shall be restated and shall be
true and correct as of the date of the applicable Advance,
as though such representations and
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warranties had been made on and as of such date.
(2) The Borrower shall be in compliance with all the terms and
provisions set froth under the Loan Documents on its part to
be observed or performed (except as such non-compliance
shall have been previously waived in writing or consented to
in writing by GDB), no Default or Event of Default shall
have occurred and be continuing at such time, and no event
shall have occurred which, with notice and/or passage of
time, and would cause a Default or Event of Default to
occur.
(3) [Intentionally Deleted].
(4) Resolutions of the Borrower and its constituent partners, in
form and substance acceptable to GDB in its sole and
absolute discretion, shall be delivered to GDB.
(5) GDB shall have received evidence acceptable to GDB that the
partners of the Borrower have made the Borrower Loan, even
if the same has been previously repaid in accordance with
Section 4.7(l).
(6) No more than twenty percent (20%) or $500,000, whichever is
greater, of the then current amount of the outstanding
Accounts Receivable, shall be more than 120 days past due.
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(k) The Borrower shall pay the Revolving Note together with interest,
fees and charges, as follows:
(1) Whenever the outstanding principal balance of the Revolving
Loan exceeds the Permitted Loan Limit, the Borrower shall
immediately pay to GDB the excess of the outstanding
principal balance of the Revolving Loan over the Permitted
Loan Limit.
(2) Each Advance under this Agreement shall bear interest at the
Revolving Loan Interest Rate from the date of each such
Advance until the Revolving Loan Maturity Date or the date
of prepayment thereof, whichever occurs first. Such interest
shall be payable quarterly in arrears on each Interest
Adjustment Date and shall be computed only on outstanding
balances of Advances on the basis of the 360 day year and
for the number of actual days elapsed.
(3) The entire unpaid principal balance of the Revolving Loan,
together with accrued and unpaid interest thereon, fees and
charges shall be due and payable in full on the Revolving
Loan Maturity Date, subject to the notice provisions of
Section 10.1(a) hereof.
(l) GDB agrees that at any time that the outstanding balance of the
Revolving Loan is zero, then the Borrower may repay the Borrower
Loan to its partners, regardless of any provisions to the
contrary under the Loan Documents or the Credit
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Facility Loan Documents, provided, however, that as a condition
precedent for the Borrower to obtain any subsequent Advances
under the Revolving Loan, then the Borrower Loan must be reloaned
to the Borrower and evidence thereof delivered to GDB in
accordance with Section 4.7(j)(5) hereof.
(m) Borrower agrees that the violation of Section 4.7(j)(6) hereof
may, at GDB's election, which may be exercised in GDB's sole and
absolute discretion, be deemed to be a Default or Event of
Default, subject to the notice provisions of Section 10.1(a)
hereof.
3. The term "Permitted Liens and Encumbrances" as used in the Loan
Agreement shall be deemed to include the Revolving Loan Mortgage and
the other liens and encumbrances evidenced by the Revolving Loan and
any liens and encumbrances shown on the Revolving Loan Title Policy.
4. As a material inducement to GDB to enter into the Second Amendment and
to make the Revolving Loan, the Borrower hereby represents, warrants
and covenants as follows:
(a) The outstanding principal amount of the Loan is $25,000,000.00;
and
(b) All outstanding and accrued interest under the GDB Loan has been
paid through September 30, 1996.
(c) [Intentionally Deleted].
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(d) As of the date hereof, the representation contained in Section
3.17 hereof is true and correct.
(e) To the knowledge of Borrower, GDB is not in default of any of its
obligations under the Loan Documents or the Operative Documents
(as defined in the Credit Facility Loan Agreement) and no event
has occurred which with lapse of time and/or notice would cause
such a default to occur;
(f) No payments have been made by or behalf of the Borrower into any
escrow account pursuant to the Escrow Requirement (as defined in
the Credit Facility Loan Agreement);
(g) The Liens granted to GDB by the Revolving Loan Documents will be,
when filed, subject only to recording which will be effected in
due course, fully perfected third (3rd) priority Liens in and to
the Revolving Loan Security described therein, subject only to
Permitted Liens and Encumbrances.
(h) That certain Development Services and Management Agreement dated
January 12, 1990 between Borrower and Williams Hospitality
Management Corporation as amended by amendments dated September
30, 1990 and January 31, 1991 has not been further amended,
modified or supplemented in any manner whatsoever since January
31, 1991 and remains in full force and effect.
(i) Those certain audited financial statements prepared by Ernst &
Young dated March 31, 1996 submitted by
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Borrower to GDB and those certain monthly financial statements
dated June 30, 1996 prepared by or on behalf of Borrower, based
on which GDB approved the Revolving Loan herein contemplated, are
true and correct in all material aspects as of the date thereof.
(j) Neither the execution and delivery of the Second Amendment and
the Revolving Loan Documents, the consummation of the
transactions contemplated thereunder, and the compliance with the
terms, conditions and provisions of the Second Amendment and the
other Revolving Loan Documents, will conflict with or result in a
breach of the terms, conditions or provisions or constitute a
default under the Partnership Agreement of Borrower, or of any
indenture or other agreement or instrument to which the Borrower
is a party or by which it is bound, or result in the creation or
imposition of any Lien, charge or encumbrance of any nature
whatsoever, upon any of the properties or assets of the Borrower,
except as permitted by the provisions of the Second Amendment and
the other Revolving Loan Documents; and except for the recording
of the Revolving Loan Mortgage and Palominos Revolving Loan
Mortgage, and except as noted in this Second Amendment, Borrower
is not required to obtain any action, approval, consent or
authorization by any governmental or quasi-governmental agency,
commission, board, bureau or instrumentality in order for the
Second Amendment to become a valid and binding obligation of
Borrower in accordance with its terms.
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5. Section 5.3 of the Loan Agreement is hereby modified to provide for
the following clause:
"(v) Borrower's obligations guaranteed by its Partners under the
Guarantees executed in connection with the Revolving Loan."
6. Borrower hereby agrees that Exhibit A to that certain Assignment
Agreement dated December 7, 1991 shall also be deemed to include those
certain agreements listed on Exhibit A attached hereto, which
constitutes an updated list of all such contracts and agreements
affecting the Premises (in addition to those already listed in such
Assignment Agreement).
7. GDB and Borrower agree that as a condition precedent to GDB's delivery
to Borrower of the Mortgage Note and Revolving Loan Mortgage in the
event the Revolving Loan is paid in full and terminated, the Revolving
Loan Mortgage shall be subordinated to the Credit Facility Mortgage by
a document in form and substance reasonably acceptable to GDB.
8. The addresses set forth in Section 11.14 of the Agreement are hereby
deleted and replaced with the following:
(a) If to GDB:
Government Development Bank for Puerto Rico
Minillas Government Center
De Diego Avenue, Stop 22
Santurce, Puerto Rico 00907
ATTN: Ana Carmen Alemany, Sr. Vice President
With a copy to:
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Gunster, Yoakley, Valdes-Fauli & Stewart, P.A.
500 East Broward Boulevard, Suite 1400
Fort Lauderdale, Florida 33394
ATTN: Andrew S. Robins, Esq.
(b) If to Borrower:
c/o Williams Hospitality Group, Inc.
187 East Isla Verde Road
San Juan, Puerto Rico 00913
ATTN: President
With a copy to:
Kumagai Caribbean, Inc.
1177 Avenue of the Americas
New York, New York 10019
and
Shack & Siegel, P.C.
530 Fifth Avenue
New York, New York 10036
ATTN: Jeffrey N. Siegel, Esq.
9. As a material inducement for GDB to accept this Second Amendment,
Borrower does hereby release, waive, discharge, covenant not to sue,
acquit, satisfy and forever discharge GDB and its officers, directors,
employees, agents and attorneys and the affiliates and assigns of all
of the foregoing of and from any and all liability, claims,
counterclaims, defenses, actions, causes of actions, suits,
controversies, agreements, promises and demands whatsoever, at law or
in equity, which Borrower had, now has, or which any personal
representative, successor, heir or assign of Borrower now or hereafter
can, shall or may have against GDB or their directors, employees,
attorneys and agents and the affiliates and assigns of all of the
foregoing, for, upon, or by reason of any matter, cause or thing
whatsoever through the date hereof relating to the Loan,
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and the Revolving Loan and any and all documents or agreements
executed in connection therewith, except that nothing herein shall be
deemed to release GDB from its obligations under such documents,
including, without limitation, its obligation to make Advances,
subject to the terms thereof. Borrower further expressly agrees that
the foregoing waiver and release is intended to be as broad and
inclusive as permitted by the laws of the Commonwealth of Puerto Rico.
In addition to, and without limiting the generality of the foregoing,
and in consideration of the GDB's acceptance of this Second Amendment,
Borrower covenants with and warrants unto GDB and its affiliates and
assigns that there exists no claims, counterclaims, defenses,
objections, offsets of claims, or offsets against GDB or the
obligation of Borrower to pay the Loan, Credit Facility or Revolving
Loan to GDB when and as the same becomes due and payable in accordance
with the terms of this Second Amendment and the other Loan Documents,
including, without limitation, the Revolving Loan Documents, and the
Operative Document(as defined in the Credit Facility Loan Agreement).
10. Except as prohibited by law, the GDB and the Borrower hereby
knowingly, voluntarily and intentionally waive the right to trial by
jury with respect to any litigation based hereon or arising out of,
under, or in connection with this Second Amendment or the other
Revolving Loan Documents, including, without limitation, the Revolving
Loan Documents, or any course of conduct, course of dealing,
statements (whether verbal or written) or actions of the Borrower or
GDB with respect to the Revolving Loan; this waiver being a material
inducement
-25-
for GDB to accept this Second Amendment. If the subject matter of any
litigation is one in which the waiver of jury trial is prohibited,
neither GDB nor the Borrower shall present as a noncompulsory
counterclaim in such litigation, any claim arising out of this Second
Amendment or the Revolving Loan Documents. Furthermore, neither GDB
nor the Borrower shall seek to consolidate any action in which a jury
trial has been waived with any litigation in which a jury trial cannot
be waived.
11. This Second Amendment shall be binding upon GDB and the Borrower and
their respective successors and assigns. This Second Amendment may be
executed in counterparts, all if which counterparts shall be deemed to
be a single document. Signature pages received by facsimile
transmission shall be deemed to be an original document.
12. This Second Amendment constitutes the complete agreement between the
parties hereto with respect to the subject matter hereof and may not
be modified, altered or amended except by an agreement in writing
signed by GDB and the Borrower. No amendment or waiver of any
provision of this Second Amendment, the Revolving Note or any other
Revolving Loan Document, nor consent to any departure by the Borrower
therefrom, shall in any event be effective unless the same shall be in
writing and signed by GDB, and then such waiver or consent shall be
effective only in the specific instance and for the specific purpose
for which given.
13. Except as otherwise modified herein, the Loan Agreement and the other
Loan Documents remain unmodified and are in full force and effect.
-26-
IN WITNESS WHEREOF, the parties hereto have executed this Second Amendment
as of the date first set forth above.
GOVERNMENT DEVELOPMENT BANK
FOR PUERTO RICO
By: /s/
--------------------------------
Name: Ana Carmen Alemana
Title: Senior Vice President
EL CONQUISTADOR PARTNERSHIP L.P.
By: /s/
--------------------------------
Name: Brian Gamache
Title: Authorized Signatory
Exhibit A
EL CONQUISTADOR
Resort And Country Club
MEMORANDUM
TO: Pam Flaherty
FROM: Larry M. Vitale
DATE: August 23, 1996
SUBJECT: Recap of Hotel Concessionaires
- ---------------------------------------------------------
Restaurants
================================================================================
Store Name Owner Service provided Tax I.D.
No.
- --------------------------------------------------------------------------------
Blossoms John He Zing Yee Restaurant 66-0491041
- --------------------------------------------------------------------------------
Gauchos (Latinos) Valerie Marty Restaurant 66-0495837
- --------------------------------------------------------------------------------
Othello's Carlos Pichetti Restaurant 66-0452336
- --------------------------------------------------------------------------------
Rest. Associates of
P.R. (Stingray) Dayn Smith Restaurant 66-0525863
- --------------------------------------------------------------------------------
Retail
- --------------------------------------------------------------------------------
Abaca Pedro Moll Shoe Store 66-0500012
- --------------------------------------------------------------------------------
Avante Peter Veneciano Health Spa 66-0500451
- --------------------------------------------------------------------------------
Bared & Sons Phillip Bared Jewelry 66-0345606
- --------------------------------------------------------------------------------
Club del Sol
(Paco Pepe/Chikos) Luis B. Gonzalez Clothing Store 66-0479241
- --------------------------------------------------------------------------------
Conversation Piece Ligia Wachtel Gifts 66-0421209
- --------------------------------------------------------------------------------
Exotica del Flower Shop 66-0525160
Conquistador Coffee Shop 66-0525159
Exotica Cafe Richard Roth
- --------------------------------------------------------------------------------
Galeria Arrecife Maria E. Torres Art 66-0527914
- --------------------------------------------------------------------------------
Group Services Inc. Saul Tanal Tour Desk 66-0486829
- --------------------------------------------------------------------------------
Events Tropical 66-0504748
Stage Crow Audiovisual Hamid Azize Audiovisual Equipment 66-0447320
- --------------------------------------------------------------------------------
American Parking Miguel Cabral Parking Concession 66-0421500
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Jose Melendez Jose Melendez Horseback Riding ###-##-####
- --------------------------------------------------------------------------------
Water Sports
Aqua Sports Wilfredo Rosado Equipment Rental 66-0499299
- --------------------------------------------------------------------------------
Palomino Divers Debra K. Black Dive Ship (Scuba) 66-0515419
- --------------------------------------------------------------------------------
M.H. Reinhold Marie Reinhold Jewelry Store 66-0440469
- --------------------------------------------------------------------------------
Mona Liza Boutique Lourdes Cortes Clothing Store 66-0515557
- --------------------------------------------------------------------------------
Gift/Logo Clothing
W.H. Smith Catherine Gardner Shops/Store 66-0220116
================================================================================