Exhibit 10.12
PROMISSORY NOTE
("Note")
$5,700,000.00
Orlando, Florida
As of April 27, 2004
THE UNDERSIGNED, ("Maker"), promises to pay to the order of JOHN SHARP
("Payee"), whose mailing address is 700 Clay Street, Winter Park, Florida 32789,
the principal sum of FIVE MILLION SEVEN HUNDRED THOUSAND DOLLARS
($5,700,000.00), with interest on the unpaid principal from the date hereof at
the following rate and payable in the following manner:
(a) The interest rate shall be a fixed rate equal to seven percent
(7.00%) per annum.
(b) Principal shall be paid in five (5) equal annual installments of
One Million and No/100 Dollars ($1,000,000.00) plus interest commencing April
27, 2005 and each April 27th thereafter until the Maturity Date.
(c) The entire unpaid principal balance, together with accrued
interest, shall be due and payable on or before April 26, 2010 ("Maturity
Date").
Default Rate. After the occurrence of an Event of Default, as
hereinafter defined or after maturity, this Note and all sums due hereunder
shall bear interest at the highest rate allowed by law from the date of default
or maturity until paid.
Interest Basis. Interest shall be calculated on the basis of a three
hundred sixty five (365) day year for actual days elapsed.
Security. This Note is secured by, among other things, a Mortgage (the
"Mortgage") upon real property (the "Property") in Orange County, Florida. This
Note, the Mortgage and other loan documents as may be now or hereafter executed
in connection therewith ("Loan Document(s)") shall together evidence the debt
and constitute the security for the Note.
Application of Payments. All payments made on the indebtedness
evidenced by this Note shall be applied first to repayment of monies paid or
advanced by Payee on behalf of the Maker in accordance with the terms of the
Loan Documents, and thereafter shall be applied to payment of accrued interest,
and lastly to payments of principal in the inverse order of their maturity. No
partial prepayment of principal will have the effect of postponing, satisfying,
reducing or otherwise affecting any scheduled installment before this Note is
paid in full.
Prepayment. In the event the principal payment is repaid earlier from
one year from closing, a minimum of one year's interest shall by paid by Maker
to Payee.
Place and Manner of Payment. All payments of interest and principal are
payable in lawful money of the United States of America in cash or immediately
available funds, or by check with credit to be given upon receipt (subject to
revocation of such credit should the check be returned for nonpayment for any
reason), at the Payee's office at which the payment is made, or at such other
place as the Payee may designate in writing.
Events of Default. Maker shall be in default in this Note upon the
occurrence of any of the following events, circumstances or conditions (each an
"Event of Default"):
(a) Maker's failure to make any payment of any sum due hereunder
within ten (10) days of the due date thereof to Maker,
(b) "The existence of a default or breach of any of the terms of
this Note or any other Loan Document which is not cured within ten (10) days of
any occurrence.
Remedies after Default. At the option of Payee, all or any part of the
principal and accrued interest on the Note, and all other obligations of the
Maker to the Payee shall become immediately due and payable without additional
notice a demand, upon the occurrence of an Event of Default or at any time
thereafter. Payee may exercise all rights and remedies provided by law, equity,
this Note or any other Loan Document or any other obligation of the Maker to the
Payee. All rights and remedies as set forth in the Loan Documents are cumulative
and concurrent and may be pursued singularly, successively or together, at the
sole discretion of Payee, and may be exercised as often as occasion therefore
shall arise. Such remedies are not exclusive, and Payee is entitled to all
remedies provided at law or equity, whether or not expressly set forth therein.
No act, or omission or commission or waiver of Payee, including specifically any
failure to exercise any right, remedy or recourse, shall be effective unless set
forth in a written document executed by Payee and then only to the extent
specifically recited therein. A waiver or release with reference to one event
shall not be construed as continuing, as a bar to, or as a waiver or release of,
any subsequent right, remedy or recourse as to any subsequent event, nor shall
any single or partial exercise thereof preclude any other or further exercise or
the exercise of any other right, remedy or recourse. No notice to or demand on
any party liable for the payment of this Note in any case shall entitle any such
party to any other or further notice or demand in the same, similar or other
circumstances unless specifically requested in writing pursuant to the terms of
the Loan Documents.
Taxes. All parties liable for the payment of this Note agree to pay all
documentary stamp tax, nonrecurring intangible tax, and all interest and
penalties, if any, on this Note and advances hereunder and on any instrument
securing the foregoing.
Collection Expenses. All parties liable for the payment of the Note
agree to pay the Payee all costs incurred by the Payee, whether or not an action
be brought, in collecting the sum s due under the Note, enforcing the
performance and/or protecting its rights under the Loan Documents and in
realizing on any of the security for the Note. Such costs and expenses shall
include, but are not
-2-
limited to, filing fees, costs of publication, deposition fees, stenographer
fees, witness fees and other court and related costs. Sums advanced by the
Payee for the payment of collection costs and expenses shall accrue interest at
the Penalty Rate, from the time they are advanced or paid by the Payee, and
shall be due and payable upon payment by Payee without notice or demand and
shall be secured by the lien of the Mortgage.
Attorneys' Fees. All parties liable for the payment of the Note agree
to pay the Payee reasonable attorneys' fees incurred by the Payee, whether or
not an action be brought, in collecting the sums due under the Note, enforcing
the performance and/or protecting its rights under the Loan Documents and in
realizing on any of the security for the Note. Such reasonable attorneys' fees
shall include, but not be limited to, fees for attorneys, paralegals, legal
assistants, and expenses incurred in any and all judicial, bankruptcy,
reorganization, administrative, receivership, or other proceedings effecting
creditor's rights and involving a claim under the Note or any Loan Document,
which such proceedings may arise before or after entry of a final judgment. Such
fees shall be paid regardless whether suit is brought and shall include all fees
incurred by Payee at all trial and appellate levels including bankruptcy court.
Sums advanced by the Payee for the payment of attorneys' fees shall
accrue bankruptcy interest at the Penalty Rate, from the time they are advanced
by the Payee, and shall be due and payable upon payment by Payee without notice
or demand and shall be secured by the lien of the Mortgage.
Waiver and Consent. By the making, signing, or endorsement of this
Note:
(a) Maker waives demand, presentment, protest, notice of protest,
notice of dishonor, suit against any party and all of the requirements
necessary to hold any maker liable;
(b) Maker and each co-signer consents to Payee's release of,
agreement not sue, suspension of the right to enforce this instrument against
and discharge or compromise of any obligation of any co-signer all without
notice to or further reservations of rights against any of such parties, and all
without in any way affecting or releasing the liability of any of such parties;
(c) Maker and each co-signor waives and consents to the release,
substitution, impairment, exchange and other dealing in any manner with all or
any portion of any collateral securing this Note and any right of set-off that
may now or hereafter secure this Note, all without notice to or further
reservations of rights against any of such parties, and all without in any way
affecting or releasing the liability of any of such parties, even though such
release, substitution, impairment, exchange or other dealing may in any manner
and to any extent impair any such collateral, lien or right of set-off;
Choice of Law and Venue. This Note shall be governed by the Laws of the
State of Florida, and the United States of America, whichever the context may
require or permit. The Maker to this obligation expressly agrees that proper
venue for any action which may be brought under this Note in addition to any
other venue permitted by law shall be any county in which property encumbered
-3-
by the Mortgage is located. Should Payee institute any action under this Note,
the Maker hereby submits to the jurisdiction of any court sitting in Florida,
Severability. If any provision of this Note shall be held
unenforceable or void, then such provision shall be deemed severable from the
remaining provisions and shall in no way affect the enforceability of the
remaining provisions nor the validity of this Note.
Time of the Essence. Time is of the essence with respect to each
provision in this Note where a time or date for performance is stated. All time
periods or dates for performance stated in this Note are material provisions of
this Note.
Documentary Stamps. Florida Documentary stamp tax as required by
Chapter 201 of the Florida Statutes in the amount required by Florida law have
been paid and are affixed to the original Mortgage and Security Agreement, of
even date herewith, which secures this Note.
IN WITNESS WHEREOF, Maker has executed and delivered this instrument
this day and year first above written.
BLACK AMBER DEVELOPMENT, INC.
an Ontario corporation
By: /s/ RUSSEL ALLEN
-------------------------------
Russel Allen,
its President
ASHTON WOODS ORLANDO LIMITED
PARTNERSHIP, a Florida limited
partnership
By: Ashton Woods Lakeside, LLC,
a Nevada limited liability
company, its General Partner
By: /s/ HARRY ROSENBAUM
---------------------------
Harry Rosenbaum,
its Manager