MODIFICATION AGREEMENT
DATE: June 28, 1994
PARTIES: Borrower: LOS ABRIGADOS PARTNERS LIMITED PARTNERSHIP,
an Arizona limited partnership
Bank: BANK ONE, ARIZONA, NA, a national banking association,
formerly known as The Valley National Bank of Arizona
RECITALS:
A. Bank has extended to Borrower credit ("Loan") in the principal amount of
$5,000,000.00 pursuant to the Loan Agreement, dated September 9, 1991 ("Loan
Agreement") and evidenced by the Promissory Note, dated September 9, 1991
("Note"). The unpaid principal of the Loan as of the date hereof is $769,000.00.
B. The Loan is secured by, among other things, the Deed of Trust (With
Assignment of Rents and Security Agreement (Variable Rate) dated September 9,
1991 ("Deed of Trust"), by Borrower, as trustor, for the benefit of Bank, as
beneficiary, recorded on September 10, 1991 in Docket No. 1421 at page 705,
records of Coconino County, Arizona (the agreements, documents, and instruments
securing the Loan and the Note are referred to individually and collectively as
the "Security Documents").
C. Bank and Borrower have executed and delivered previously the following
agreements ("Modifications") modifying the terms of the Loan, the Note, the Loan
Agreement, and/or the Security Documents: Letter Agreement dated September 9,
1991, Modification Agreement dated October 22, 1993, Letter Agreement dated
April 18, 1994. (The Note, the Loan Agreement, the Security Documents, any
arbitration resolution, any environmental certification and indemnity agreement,
and all other agreements, documents, and instruments evidencing, securing, or
otherwise relating to the Loan, as modified in the Modifications, are sometimes
referred to individually and collectively as the ("Loan Documents").
Hereinafter, "Note", "Loan Agreement", "Deed of Trust", and "Security Documents"
shall mean such documents as modified in the Modifications.)
D. Borrower has requested that Bank modify the Loan and the Loan Documents as
provided herein. Bank is willing to so modify the Loan and the Loan Documents,
subject to the terms and conditions herein.
AGREEMENT:
For good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, Borrower and Bank agree as follows:
1. ACCURACY OF RECITALS
Borrower acknowledges the accuracy of the Recitals.
2. MODIFICATION OF LOAN DOCUMENTS
2.1 The Loan Documents are modified as follows:
2.1.1 The definition of "Release Price" in the Loan Agreement is hereby changed
from $2,000.00 per Timeshare Interval to $1,000.00 per Timeshare Interval with
respect to which Lender provides a Release pursuant to Article VIII of said Loan
Agreement.
2.1.2 Paragraph 3 (c) of the Note is hereby modified to read in its entirety as
follows:
(c) Accrued interest shall be payable commencing on October 1, 1991 and on the
first day of each month thereafter. Principal shall be due and payable in
quarterly installments on the first day of each January, April, July and October
during the term of this Note through April 1, 1994 as follows:
Quarterly Payment Date Amount
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January 1, 1992 ...................................... $ 250,000.00
April 1, 1992 ........................................ 250,000.00
July 1, 1992 ......................................... 250,000.00
October 1, 1992 ...................................... 250,000.00
January 1, 1993 ...................................... 312,500.00
April 1, 1993 ........................................ 312,500.00
July 1, 1993 ......................................... 312,500.00
October 1, 1993 ...................................... 312,500.00
January 1, 1994 ...................................... 375,000.00
April 1, 1994 ........................................ 375,000.00
Thereafter, principal shall be due and payable in monthly installments of
$80,000.00 each on the first day of each month commencing on July 1, 1994. All
other amounts at any time outstanding pursuant to this Note or the Loan
Documents and not otherwise paid shall be due and payable in full on the
Maturity Date.
2.2 Each of the Loan Documents is modified to provide that it shall be a default
or an event of default thereunder if Borrower shall fail to comply with any of
the covenants of Borrower herein or if any representation or warranty by
Borrower herein or by any guarantor in any related Consent and Agreement of
Guarantor(s) is materially incomplete, incorrect, or misleading as of the date
hereof.
2.3 Each reference in the Loan Documents to any of the Loan Documents shall be a
reference to such document as modified herein.
3. RATIFICATION OF LOAN DOCUMENTS AND COLLATERAL
The Loan Documents are ratified and affirmed by Borrower and shall remain in
full force and effect as modified herein. Any property or rights to or interests
in property granted as security in the Loan Documents shall remain as security
for the Loan and the obligations of Borrower in the Loan Documents.
4. BORROWER REPRESENTATIONS AND WARRANTIES
Borrower represents and warrants to Bank:
4.1 No default or event of default under any of the Loan Documents as modified
herein, nor any event, that, with the giving of notice or the passage of time or
both, would be a default or an event of default under the Loan Documents as
modified herein has occurred and is continuing.
4.2 There has been no material adverse change in the financial condition of
Borrower or any other person whose financial statement has been delivered to
Bank in connection with the Loan from the most recent financial statement
received by Bank.
4.3 Each and all representations and warranties of Borrower in the Loan
Documents are accurate on the date hereof.
4.4 Borrower has no claims, counterclaims, defenses, or set-offs with respect to
the Loan or the Loan Documents as modified herein.
4.5 The Loan Documents as modified herein are the legal, valid, and binding
obligation of Borrower, enforceable against Borrower in accordance with their
terms.
4.6 Borrower is validly existing under the laws of the State of its formation or
organization and has the requisite power and authority to execute and deliver
this Agreement and to perform the Loan Documents as modified herein. The
execution and delivery of this Agreement and the performance of the Loan
Documents as modified herein have been duly authorized by all requisite action
by or on behalf of Borrower. This Agreement has been duly executed and delivered
on behalf of Borrower.
5. BORROWER COVENANTS
Borrower covenants with Bank:
5.1 Borrower shall execute, deliver, and provide to Bank such additional
agreements, documents, and instruments as reasonably required by Bank to
effectuate the intent of this Agreement.
5.2 Borrower fully, finally, and forever releases and discharges Bank and its
successors, assigns, directors, officers, employees, agents, and representatives
from any and all actions, causes of action, claims, debts, demands, liabilities,
obligations, and suits, of whatever kind or nature, in law or equity of
Borrower, whether now known or unknown to Borrower, (i) in respect of the Loan,
the Loan Documents, or the actions or omissions of Bank in respect of the Loan
or the Loan Documents and (ii) arising from events occurring prior to the date
of this Agreement.
5.3 Contemporaneously with the execution and delivery of this Agreement,
Borrower has paid to Bank:
5.3.1 All accrued and unpaid interest under the Note and all amounts, other than
interest and principal, due and payable by Borrower under the Loan Documents as
of the date hereof.
5.3.2 All the internal and external costs and expenses incurred by Bank in
connection with this Agreement (including, without limitation, inside and
outside attorneys, appraisal, appraisal review, processing, title, filing, and
recording costs, expenses, and fees).
6. EXECUTION AND DELIVERY OF AGREEMENT BY BANK
Bank shall not be bound by this Agreement until (i) Bank has executed and
delivered this Agreement, (ii) Borrower has performed all of the obligations of
Borrower under this Agreement to be performed contemporaneously with the
execution and delivery of this Agreement, (iii) each guarantor(s) of the Loan,
if any, has executed and delivered to Bank a Consent and Agreement of
Guarantor(s), and (iv) if required by Bank, Borrower and any guarantor(s) have
executed and delivered to Bank an arbitration resolution, an environmental
questionnaire, and an environmental certification and indemnity agreement.
7. INTEGRATION, ENTIRE AGREEMENT, CHANGE, DISCHARGE, TERMINATION, OR
WAIVER
The Loan Documents as modified herein contain the complete understanding and
agreement of Borrower and Bank in respect of the Loan and supersede all prior
representations, warranties, agreements, arrangements, understandings, and
negotiations. No provision of the Loan Documents as modified herein may be
changed, discharged, supplemented, terminated, or waived except in a writing
signed by the parties thereto.
8. BINDING EFFECT
The Loan Documents as modified herein shall be binding upon and shall inure to
the benefit of Borrower and Bank and their successors and assigns and the
executors, legal administrators, personal representatives, heirs, devisees, and
beneficiaries of Borrower, provided, however, Borrower may not assign any of its
right or delegate any of its obligation under the Loan Documents and any
purported assignment or delegation shall be void.
9. CHOICE OF LAW
This Agreement shall be governed by and construed in accordance with the laws of
the State of Arizona, without giving effect to conflicts of law principles.
10. COUNTERPART EXECUTION
This Agreement may be executed in one or more counterparts, each of which shall
be deemed an original and all of which together shall constitute one and the
same document. Signature pages may be detached from the counterparts and
attached to a single copy of this Agreement to physically form one document.
DATED as of the date first above stated.
LOS ABRIGADOS PARTNERS LIMITED PARTNERSHIP,
an Arizona limited partnership
By: ILE Sedona Incorporated, an Arizona corporation,
General Partner
By: Joseph P. Martori
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Name: JOSEPH P. MARTORI
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Title: President
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State of Arizona
County of
The above instrument was acknowledged before me this 30th day of June, 1994, by
JOSEPH P. MARTORI the President of ILE Sedona Incorporated, an Arizona
corporation, the General Partner of Los Abrigados Partners Limited Partnership,
an Arizona limited partnership, on behalf of the partnership.
My commission expires:
February 9, 1998 Lorraine Wing
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Notary Public