WHEN RECORDED, RETURN TO:
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Jay S. Kramer
Fennemore Craig
Two North Central Avenue
Suite 2200
Phoenix, AZ 85004
SECOND AMENDMENT TO
RETAIL PHASE CONSTRUCTION LOAN AGREEMENT,
RETAIL PHASE PROMISSORY NOTE
AND
RETAIL PHASE LEASEHOLD
DEED OF TRUST AND SECURITY AGREEMENT WITH
ASSIGNMENT OF RENTS AND FIXTURE FILING
THIS SECOND AMENDMENT TO RETAIL PHASE CONSTRUCTION LOAN AGREEMENT,
RETAIL PHASE PROMISSORY NOTE AND RETAIL PHASE LEASEHOLD DEED OF TRUST AND
SECURITY AGREEMENT WITH ASSIGNMENT OF RENTS AND FIXTURE FILING (the "Amendment")
is made as of this 31st day of October, 1995 by and among CAMELBACK PLAZA
DEVELOPMENT L.C., an Arizona limited liability company ("Borrower"), NORWEST
BANK ARIZONA, NATIONAL ASSOCIATION, a national banking association ("Lender"),
the successor-by-merger to Caliber Bank, an Arizona banking corporation
("Caliber"), and PERFORMANCE INDUSTRIES, INC., an Ohio corporation
("Guarantor").
WHEREAS, Borrower and Caliber entered into that certain Retail Phase
Construction Loan Agreement dated as of June 24, 1994 (the "Loan Agreement"),
pursuant to which Lender agreed to advance up to $3,000,000 to Borrower (the
"Construction Loan") for the construction and equipping of the Improvements;
WHEREAS, the Construction Loan is evidenced or secured by, among
others, the Loan Agreement, that certain Retail Phase Promissory Note dated June
24, 1994 from Borrower in favor of Caliber in the original amount of $3,000,000
(the "Note"), that certain Retail Phase Leasehold Construction Deed of Trust and
Security Agreement with Assignment of Rents and Fixture Filing dated June 24,
1994 from Borrower in favor of Caliber, recorded on September 26, 1994 as
Instrument No. 94-0702374, Records of Maricopa County, Arizona (the "Deed of
Trust"), as amended by Amendment to Retail Phase Construction Loan Agreement,
Retail Phase Promissory Note, and Retail Phase Deed of Trust dated September 21,
1994, recorded on September 26, 1994 as Instrument No. 94-0702377, Records of
Maricopa County, Arizona, which encumbers the Mortgaged Property as described
therein, that certain Assignment of Retail Leases dated June 24, 1994 from
Borrower in favor of Caliber, recorded on September 26, 1994 as Instrument No.
94-0702375, Records of Maricopa County, Arizona (the "Assignment of Leases"),
that certain Subordination Agreement (Retail Phase) dated June 24, 1994 from
Guarantor in favor of Caliber, recorded on September 26, 1994 as Instrument No.
94-0702373, Records of Maricopa County, Arizona (the "Subordination Agreement"),
and that certain
Unconditional Guarantee of Payment dated June 24, 1994 from Guarantor in favor
of Caliber (the "Guaranty") (the Loan Agreement, the Note, the Deed of Trust,
the Assignment of Leases, the Subordination Agreement and the Guaranty and any
other agreement now or hereafter given by Borrower or Guarantor evidencing,
securing or relating to the Loan are sometimes hereinafter referred to
collectively as the "Loan Documents");
WHEREAS, the Loan Agreement provided for a mini-permanent loan upon the
expiration of the Initial Maturity Date of the Note, provided that Borrower
satisfied certain conditions precedent thereto, which conditions precedent were
not satisfied;
WHEREAS, the Construction Loan has been fully advanced and Borrower has
not fulfilled all of the conditions precedent for the final advance under the
Construction Loan;
WHEREAS, Borrower has requested, and Lender has agreed, to extend the
Initial Maturity Date upon the terms and conditions contained herein;
NOW, THEREFORE, in consideration of the premises set forth above and
the covenants and agreements contained herein, and other consideration, the
receipt and sufficiency of which are hereby acknowledged, Borrower and Lender,
intending to be legally bound, agree as follows:
1. Interpretation. Except as otherwise defined herein, all capitalized
terms used herein shall have the meanings ascribed thereto in the Loan
Documents. In the event of any conflicts between the terms and provisions of
this Amendment and the terms and provisions of the Loan Documents, the terms and
provisions of this Amendment shall govern and prevail.
2. Conditions Precedent. The effectiveness of this Amendment is subject
to the condition precedent that Lender shall have received on or before the date
hereof the following, in form and substance satisfactory to Lender:
(a) This Amendment, duly executed and delivered by Borrower
and Guarantor.
(b) Certified copies of the resolutions of the boards of
directors of Performance Camelback Development Corp. and Guarantor authorizing
the execution, delivery and performance of this Amendment and any other
documents, agreements or certificates required by Lender or any other Person in
connection with the transactions contemplated by this Amendment.
(c) An incumbency certificate from the Secretary or an
Assistant Secretary of Performance Camelback Development Corp. and Guarantor,
certifying the names and true signatures of the officers of Performance
Camelback Development Corp. and Guarantor authorized to sign this Amendment and
the other documents to be delivered by them hereunder.
(d) Current certificates of good standing for Borrower and
Guarantor issued by the applicable governmental agency of their state of
formation.
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(e) An Amendment to the Restaurant Phase Construction Loan
Agreement, Retail Phase Promissory Note and Retail Phase Leasehold Construction
Deed of Trust and Security Agreement with Assignment of Rents and Fixture Filing
from Borrower and Guarantor in favor of Lender, and satisfaction of all
conditions to the effectiveness thereof.
(f) An opinion of Borrower's and Guarantor's counsel from
legal counsel and in form and substance satisfactory to Lender.
(g) A final as-built survey of the Retail Phase of the
Project.
(h) A Certificate of the Architect that the Improvements have
been completed in accordance with the Plans and Specifications.
(i) Evidence of, and a certificate of insurance naming Lender
as mortgagee satisfactory to Lender with respect to, the fire and extended
coverage insurance policy and rental interruption insurance for the Retail Phase
as required pursuant to Section 4.3.2 of the Loan Agreement, and evidence of
compliance with all other insurance requirements under the Loan Documents and
all insurance requirements under the Ground Lease.
(j) Full and final lien waivers from the Contractor and all
subcontractors and materialmen for the Retail Phase.
(k) Such endorsements to Lender's existing title policy as may
be requested by Lender insuring the continued priority of Lender's lien, in the
same priority as stated in the original title policy, subject only to the
exceptions shown in the title policy and current taxes and assessments.
(l) A Ground Lessor Estoppel Certificate and Agreement in form
and substance satisfactory to Lender.
(m) Evidence satisfactory to Lender that the legal action
instituted by Just For Feet, Inc. against Borrower has been dismissed with
prejudice and/or settled on terms acceptable to Lender, that the space lease
between Borrower and Just For Feet, Inc. has been amended such that the deadline
for occupancy and opening for business of the Hard Rock Cafe has been extended
to no earlier than December 31, 1995, and that $100,000 was paid in cash by
Borrower to Just for Feet, Inc. for reimbursement of tenant improvement expenses
incurred by Just for Feet, Inc.
(n) A Subordination, Non-Disturbance and Attornment Agreement
and an Estoppel Certificate from Just For Feet, Inc., both satisfactory to
Lender.
(o) Final certificates of occupancy for all shell buildings
and tenant improvements for the Mortgaged Property.
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(p) The balance sheets, statements of income and changes in
financial position of Borrower for the fiscal year ending December 31, 1994 and
the year-to-date ending September 30, 1995, accompanied by a statement from the
President or chief financial officer of the managing member of Borrower that the
same have been prepared in accordance with GAAP.
(q) The balance sheets, statements of income and changes in
financial position of Guarantor for the fiscal year ending December 31, 1994 and
the fiscal quarter ending September 30, 1995, accompanied by a statement from
the President or chief financial officer of Guarantor that the same have been
prepared in accordance with GAAP and, with respect to the fiscal year-end
information, certified with an unqualified opinion from independent public
accountants acceptable to the Lender.
(r) Copies of Guarantor's quarterly report on Form 10-Q for
the fiscal quarter ending September 30, 1995 and annual report on Form 10-K for
the fiscal year ending December 31, 1994, together with all exhibits and
schedules thereto, and copies of any reports of Guarantor on Form 8-K, and all
exhibits and schedules thereto, not previously provided to Lender.
(s) All costs and expenses incurred by Lender in connection
with the negotiation, due diligence and documentation of this Amendment and any
other agreements relating to the Mortgaged Property.
(t) Such other documents, instruments, approvals (and, if
requested by the Lender, certified duplicates of executed copies thereof) or
opinions as the Lender may request.
3. Representations and Warranties. Borrower and Guarantor, jointly and
severally, represent and warrant as follows:
(a) Borrower is a limited liability company duly formed and
validly existing under the laws of the State of Arizona.
(b) Guarantor is a corporation duly formed and validly
existing under the laws of the State of Ohio and Guarantor is duly
qualified to transact business as a foreign corporation in the State of
Arizona.
(c) The execution, delivery and performance by Borrower and
Guarantor of this Amendment and any other documents, agreements or
certificates required by Lender in connection with the transactions
contemplated by this Amendment are within their company or corporate
powers, have been duly authorized by all necessary action, do not
contravene (i) their organizational documents or (ii) any law or
contractual restriction binding on or affecting Borrower or Guarantor,
and do not result in or require the creation of any lien, security
interest or other charge or encumbrance (other than pursuant to this
Agreement and the other documents executed in connection herewith) upon
or with respect to any of their properties.
-4-
(d) No authorization or approval or other action by, and no
notice to or filing with, any governmental authority or regulatory body
is required for the due execution, delivery and performance by Borrower
or Guarantor of this Amendment and any other documents, agreements or
certificates required by Lender in connection with the transactions
contemplated by this Amendment.
(e) This Amendment and any other documents, agreements or
certificates required by Lender in connection with the transactions
contemplated by this Amendment are the legal, valid and binding
obligations of Borrower and Guarantor enforceable against them in
accordance with their respective terms (except to the extent that such
enforcement may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar law affecting creditors' rights
generally or subject to general principles of equity).
(f) There is no pending or, to the best of Borrower's or
Guarantor's knowledge, threatened action, investigation or proceeding
before any court, governmental agency or arbitrator against or
affecting Borrower, Guarantor or any of their affiliates which, if
adversely determined, would materially adversely affect the financial
condition or operations of Borrower or Guarantor or their affiliates.
(g) The balance sheet of Borrower and the related statements
of income and of changes in financial position of Borrower and for its
fiscal year most recently ended, copies of which have been furnished to
Lender, present fairly the financial condition of Borrower as of such
date and the results of the operations of Borrower for the period ended
on such date, all in accordance with GAAP consistently applied; and
since the date of such statement, there has been no material adverse
change in Borrower's financial condition or operations. The balance
sheet of Guarantor, and the related statements of income and changes in
financial position of Guarantor, for its fiscal year most recently
ended, fairly present the financial condition of Guarantor at such date
and the results of operations for the period then ended, all in
accordance with GAAP consistently applied; and since such date there
has been no material adverse change in Guarantor's financial condition
or operations.
4. Amendments to Loan Agreement. (a) Section 1.16 of the Loan Agreement
is hereby deleted in its entirety and the following inserted therefor:
1.16 "Lender": Norwest Bank Arizona, National
Association, a national banking association, whose address,
for the purpose of this Agreement, and particularly provisions
hereof relating to notice is: Norwest Bank Arizona, 3300 North
Central Avenue, M.S. 9008, Phoenix, AZ 85012-2501, Attn: Ms.
Vicki Slade, Vice President.
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(b) Section 6.4 of the Loan Agreement is hereby deleted in its entirety
and the following inserted therefor:
6.4 Records. Borrower shall maintain, and shall cause
Guarantor to maintain, proper books of record and account, in
which full and correct entries shall be made in accordance
with generally accepted accounting principles, of all its
business and affairs. Borrower shall furnish to Lender, or
cause Guarantor to furnish to Lender:
6.4.1 As soon as available and in any event
within forty-five (45) days after the end of each of the first
three quarters of each fiscal year of Borrower and as soon as
available and in any event within one-hundred twenty (120)
days after the end of each fiscal year of Borrower, balance
sheets, statements of income and changes in financial position
of Borrower for the period commencing at the end of the
previous fiscal year and ending with the end of such quarter
or fiscal year, as applicable, accompanied by a compliance
certificate in the form attached hereto as Exhibit "D" and
incorporated herein by this reference (the "Borrower
Compliance Certificate").
6.4.2 As soon as available and in any event
within forty-five (45) days after the end of each of the first
three quarters of each fiscal year of Guarantor and as soon as
available and in any event within one-hundred twenty (120)
days after the end of each fiscal year of Guarantor, balance
sheets, statements of income and changes in financial position
of Guarantor for the period commencing at the end of the
previous fiscal year and ending with the end of such quarter
or fiscal year, as applicable, accompanied by a statement from
the President or chief financial officer of Guarantor that the
same have been prepared in accordance with GAAP and, with
respect to the fiscal year-end information, certified with an
unqualified opinion from independent public accountants
acceptable to the Lender, together with a compliance
certificate in the form attached hereto as Exhibit "E" and
incorporated herein by this reference (the "Guarantor
Compliance Certificate").
6.4.3 On or before fifteen (15) days after
delivery to the Securities Exchange Commission, copies of
Guarantor's quarterly report on Form 10-Q and annual report on
Form 10-K reports, together with all exhibits and schedules
thereto. On or before five (5) days after delivery to the
Securities Exchange Commission, copies of Guarantor's reports
on Form 8-K, and all exhibits and schedules thereto.
-6-
(c) Section 6 of the Loan Agreement is hereby amended to add the
following:
6.14 Negative Covenants. So long as any indebtedness
of Borrower or Guarantor to Lender remains unpaid, without the
prior written consent of the Lender, Borrower will not do, or
permit to be done, the following:
(a) Make any loan to an affiliate.
(b) Incur any guarantee of any indebtedness of an
affiliate.
(c) Borrow money from, or otherwise create
indebtedness to, any affiliate unless such borrowing or the
creation of such indebtedness is specifically subordinated in
writing to the indebtedness of Borrower and Guarantor to
Lender and the terms and conditions of all such subordinated
borrowings and indebtedness shall be subject to prior written
approval of Lender.
(d) Permit any further encumbrance on the Mortgaged
Property.
(d) Section 7 of the Loan Agreement is hereby amended to add the
following:
7.11 Restaurant Phase Construction Loan Agreement. An
event of default shall occur and be continuing under that
certain Restaurant Phase Construction Loan Agreement dated as
of June 24, 1994 between Borrower and Caliber Bank and any
documents or instruments now or hereafter evidencing, securing
or otherwise relating to the $1,900,000 loan (the "Restaurant
Phase Loan") advanced or to be advances thereunder (together
with any amendments, modifications or supplements thereto, or
restatements thereof, the "Restaurant Phase Loan Documents").
and (e) Section 10 of the Loan Agreement is hereby deleted in its entirety and
the following inserted therefor:
10. MINI-PERMANENT LOAN.
--------------------
Provided that no Event of Default under the
Loan Documents or "event of default" under the Restaurant
Phase Loan Documents has occurred and is continuing on
December 31, 1995, and provided further that Borrower has
complied by such date with the conditions precedent enumerated
in the Mini-Perm Loan Documents (as defined below), the
maturity date of the Construction Loan and the Restaurant
Phase Loan shall be
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extended for a period of forty (40) months from December 31,
1995 (the "Mini-Perm Loan"). Borrower and Lender shall execute
and deliver loan documents in the form attached to the
Restaurant Phase Construction Loan Agreement and incorporated
herein by this reference (the "Mini-Perm Loan Documents").
5. Amendments to Note. (a) Section 2 of the Note is hereby deleted in
its entirety and the following inserted therefor:
2. Initial Term. Commencing on October 31, 1995, and
on the last day of each calendar month thereafter, continuing
to and including December 31, 1995 (the "Initial Maturity
Date"), Maker shall pay installments of interest only on the
balance outstanding hereunder, but with a final payment of all
unpaid principal and interest due and payable on the Initial
Maturity Date.
(b) Section 3 of the Note is hereby deleted in its entirety and the
following inserted therefor:
3. INTENTIONALLY DELETED.
and (c) Exhibits "A" and "B" to the Note are hereby deleted in their entirety.
6. Amendments to Deed of Trust. (a) Paragraphs "TWO" and "THREE" on
page 4 of the Deed of Trust are hereby deleted in their entirety and the
following inserted therefor:
TWO: Payment and performance of each and every
obligation and liability of Trustor and/or Performance
Industries, Inc. ("Guarantor") under that certain Restaurant
Phase Construction Loan Agreement dated as of June 24, 1994
between Borrower and Caliber Bank and any documents or
instruments now or hereafter evidencing or securing the
$1,900,000 loan (the "Restaurant Phase Loan") advanced or to
be advances thereunder (together with any amendments,
modifications or supplements thereto, or restatements thereof,
the "Restaurant Phase Loan Documents").
THREE: Payment of all other monies herein or in the
Loan Documents (as defined below) agreed or provided to be
paid by Trustor or Guarantor.
(b) The first paragraph on page 5 of the Deed of Trust is hereby deleted
in its entirety and the following inserted therefor:
This Deed of Trust, the Note, the Guarantee and any
other agreement now or hereafter given by Trustor or Guarantor
evidencing, securing or otherwise relating to the obligations
under
-8-
the Note are sometimes hereinafter referred to collectively as
the "Loan Documents".
(c) Section 1.2 of the Deed of Trust is hereby amended to add the
following:
Trustor shall not, without the prior written approval of
Beneficiary, create or suffer to exist any mortgage, lien,
charge, encumbrance, easement, or license of any kind on, or
pledge of, the Mortgaged Property.
(d) Section 1.6.4 of the Deed of Trust is hereby deleted in its entirety
and the following inserted therefor:
1.6.4 The architect for the Improvements shall be
required to provide architect's professional liability
insurance with a limit of liability of not less than
$1,000,000.00. This policy shall permit claims to be filed
thereunder for a period of not less than three (3) years
following the completion of the Improvements.
(e) The first paragraph of Section 1.10.1 of the Deed of Trust is hereby
deleted in its entirety and the following inserted therefor:
1.10.1 Trustor will submit to Beneficiary for
approval each lease for leasing any portion of the Property
and each amendment, modification, supplement or restatement of
any lease of any portion of the Property, which approval shall
not be unreasonably withheld by Beneficiary. Beneficiary shall
not withhold its approval of any amendment, modification,
supplement or restatement of any existing lease which does not
release tenant or any other person or entity liable for the
obligations of the tenant under such lease, reduce the rent or
additional rent payments of the tenant or otherwise change the
payment terms under such lease, shorten the lease term, reduce
the size of the leased premises, increase the obligations or
liabilities of the Trustor under such lease or otherwise
change any other material provision of such lease.
(f) The second paragraph of Section 1.12 of the Deed of Trust is hereby
deleted in its entirety and the following inserted therefor:
Trustor shall furnish Beneficiary and shall cause Guarantor to
furnish to Beneficiary:
(a) As soon as available, but in no event
later than 45 days after each fiscal quarter (including
Borrower's and Guarantor's fiscal year-end quarter), an
unaudited balance sheet as of the end of the relevant fiscal
quarter and an unaudited statement
-9-
of income for the same period, setting forth in each case in
comparative form the figures for the corresponding periods of
the preceding year, all in reasonable detail, prepared in
accordance with generally accepted accounting principles
consistently applied and certified as complete and correct,
subject to changes resulting from year end adjustments, by a
principal financial officer of Trustor or Guarantor, as the
case may be, together with the Borrower Compliance Certificate
or Guarantor Compliance Certificate, as applicable, as
required pursuant to the Loan Agreement; and
(b) Within 120 days after the end of each
fiscal year, an unaudited balance sheet of Trustor and an
audited balance sheet of Guarantor, as at the end of such
year, setting forth in comparative form the figures for the
previous calendar year, all in reasonable detail and, with
respect to Guarantor, accompanied by an opinion thereon of
independent certified public accounts, who shall have been
approved by Beneficiary, which opinion shall state that such
financial statements fairly present the financial condition of
Guarantor (subject to such reasonable qualifications as may be
necessary, so long as the substance of the qualification does
not involve a scope limitation imposed by Guarantor on such
accountants, their audit, or audit procedures), that such
financial statements have been prepared in accordance with
generally accepted accounting principles consistently applied
(except for changes in application in which such accountants
concur), that the examination of such accountants in
connection with such financial statements has been made in
accordance with generally accepted auditing standards, and
accordingly, included such tests of the accounting records and
such other auditing procedures as were considered necessary
under the circumstances, and, in the course of such
examination such accountants did not become aware of any Event
of Default, or act, omission or event that with the giving of
notice and/or passage of time would constitute an Event of
Default, under the Loan Documents. Trustor will furnish
Beneficiary and cause Guarantor to furnish Beneficiary with
such other financial information, reports, and statements, pro
forma or otherwise, as Beneficiary may from time to time
reasonably request concerning the financial affairs and
business operations of Trustor or Guarantor.
(c) On January 1 and July 1 of each year,
current rent rolls and financial and accounting data relative
to the Improvements and operation of the business conducted
therein, in form and substance satisfactory to Beneficiary.
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(d) On or before fifteen (15) days after
delivery to the Securities Exchange Commission, copies of
Guarantor's quarterly report on Form 10-Q and annual report on
Form 10-K reports, together with all exhibits and schedules
thereto. On or before five (5) days after delivery to the
Securities Exchange Commission, copies of Guarantor's reports
on Form 8-K, and all exhibits and schedules thereto.
(g) Section 2.1.1 of the Deed of Trust is hereby deleted in its entirety
and the following inserted therefor:
2.1.1 Breach or default in payment of any principal,
interest or other indebtedness evidenced by the Note and/or
any other indebtedness or payments of money secured hereby,
including, without limitation, the Restaurant Phase Loan
Documents, which is not cured within ten (10) days after the
occurrence of such breach or default; or
(h) all notices to Beneficiary under Section 3.6.1 of the Deed of Trust
shall be addressed as follows:
To Beneficiary: Norwest Bank Arizona
3300 North Central Avenue
M.S. 9008
Phoenix, AZ 85012-2501
Attn: Ms. Vicki Slade, Vice President
With a copy to: Jay S. Kramer
Fennemore Craig
Two North Central Avenue
Suite 2200
Phoenix, AZ 85004-2390
(i) Section 3.14 of the Deed of Trust is hereby deleted in its entirety
and the following inserted therefor:
3.14 Conveyance of Property; Change of Ownership. In
order to protect Beneficiary under this Deed of Trust and the
other Loan Documents, Trustor agrees that if either (i)
Trustor sells, conveys, transfers, disposes of, or leases
(except as provided in Section 1.10.1 of the Deed of Trust)
the Property or any portion thereof, either voluntarily,
involuntarily, or otherwise, or enters into an agreement so to
do, or (ii) if there is any change in the general partners,
shareholders, or members of Trustor without the prior written
consent of Beneficiary (other than transfers as a result of
death or transfers by a natural person to a member or members
of his or her immediate family or transfers by any natural
persons
-11-
in connection with bona fide estate planning), Trustor shall,
not less than thirty (30) days prior to any such event, notify
Beneficiary in writing of the occurrence of any such event,
and Beneficiary, whether or not it received such notice, upon
the occurrence of any one or more of any such events, shall
have the right to declare the obligations under that certain
Restaurant Phase Construction Loan Agreement dated as of June
24, 1994 between Borrower and Caliber Bank and any documents
or instruments now or hereafter evidencing, securing or
otherwise relating to the $1,900,000 loan (the "Restaurant
Phase Loan") advanced or to be advances thereunder (together
with any amendments, modifications or supplements thereto, or
restatements thereof, the "Restaurant Phase Loan Documents")
and the Loan Documents immediately due and payable, together
with all accrued and unpaid interest and other amounts due
hereunder and under the other Loan Documents and under the
Restaurant Phase Loan Documents, which sum shall be applied,
after being applied to payment of all other sums secured
hereby then due and payable in such order as Beneficiary may
determine, to the reduction of the unpaid principal balance of
the Note and the Restaurant Phase Note.
Trustor agrees to submit or cause to be submitted to
Beneficiary within thirty (30) days after December 31 of each
calendar year after the date hereof, without further request
from Beneficiary, and within ten (10) days after any written
request by Beneficiary for the same, a sworn, notarized
certificate signed by Trustor or the general partners or
officer of Trustor stating whether (i) the property encumbered
by this Deed of Trust or any part thereof has been conveyed,
transferred, assigned, sold or leased, and (ii) there has been
any change in the general partners, shareholders, or members
of Trustor.
and (j) Article III of the Deed of Trust is hereby amended to add the following:
3.18 General Indemnification. Trustor agrees to
indemnify and hold Beneficiary harmless from and against any
claim, liability, expense, or cause of action arising out of
Trustor's ownership of the Mortgaged Property (including
environmental liabilities and claims related to any Hazardous
Substance or otherwise), Trustor's construction, use, and
occupancy of the Improvements and the mortgaging of the
Mortgaged Property to Beneficiary.
7. Lien Priority. Borrower and Lender acknowledge and agree that the
lien of the Deed of Trust and any other document evidencing, securing or
guaranteeing the Note and all advances made thereunder are, and shall remain,
prior in lien and in payment to the lien and payment of that certain Restaurant
Phase Leasehold Construction Deed of Trust and Security
-12-
Agreement with Assignment of Rents and Fixture Filing dated June 24, 1994 from
Trustor in favor of Beneficiary, recorded on July 8, 1994 as Instrument No.
94-0528680, Records of Maricopa County, Arizona, as amended by Amendment to
Restaurant Phase Construction Loan Agreement, Restaurant Phase Promissory Note,
and Restaurant Phase Deed of Trust dated September 21, 1994, recorded on
September 26, 1994 as Instrument No. 94-0702378, Records of Maricopa County,
Arizona, and Tenth Amendment to Restaurant Phase Construction Loan Agreement,
Restaurant Phase Promissory Note, and Restaurant Phase Deed of Trust dated
October 31, 1995 between Trustor and Beneficiary, and recorded concurrently
herewith, and the promissory note secured thereby and all advances made
thereunder.
8. Release Of Lender and Caliber.
-----------------------------
(a) As additional consideration for the agreements by Lender
as set forth in this Amendment, Borrower and Guarantor hereby release and
forever discharge Lender and Caliber, and their agents, servants, employees,
directors, officers, attorneys, branches, affiliates, subsidiaries, successors
and assigns and all persons, firms, corporations, and organizations in their
behalf, of and from all damage, loss, claims, demands, liabilities, obligations,
actions and causes of action whatsoever which Borrower or Guarantor may now have
or claim to have against Lender or Caliber, whether presently known or unknown,
and of every nature and extent whatsoever on account of or in any way touching,
concerning, arising out of or founded upon the Note, the Loan Documents or upon
this Amendment, including, without limitation, all such loss or damage of any
kind heretofore sustained, or that may arise as a consequence of the dealings
between the parties prior to the date hereof. The release set forth above shall
not extend to any claim arising after the date hereof to the extent based on
acts or omissions of Lender or Caliber occurring after such date, except that
such release is specifically intended by the parties to include the transactions
leading up to the execution of this Amendment. This Amendment and the covenants
contained in this Section 8 are contractual, and not a mere recital, and the
parties hereto acknowledge and agree that no liability whatsoever is admitted on
the part of any party, except as provided for by the Loan Documents and this
Amendment.
(b) Borrower and Guarantor acknowledge and agree that Lender
is not, and shall not be, obligated in any way to continue or undertake any
loan, financing or other credit arrangement with Borrower, including, without
limitation, any renewal of the indebtedness evidenced by the Note, beyond the
maturity date thereof as set forth therein.
9. Miscellaneous Provisions.
------------------------
(a) Governing Law. This Amendment shall be governed by and
construed in accordance with the laws of the State of Arizona.
(b) Counterparts. This Amendment may be executed in one or
more counterparts, each of which shall constitute an original and all of which
combined shall constitute one and the same instrument.
(c) Headings. Paragraph or other headings contained in this
Amendment are for reference purposes only and are not intended to affect in any
way the meaning or interpretation of this Amendment.
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(d) Binding Effect. All of the provisions of this Amendment
shall be binding upon and inure to the benefit of Borrower and Lender and their
permitted successors and assigns, including without limitation any successor
trustor or beneficiary under the Deed of Trust.
10. Amendment. The Note and all other Loan Documents, including without
limitation the Guaranty and Subordination Agreement, shall remain in full force
and effect, except as modified by this Amendment, and the liability thereunder,
the liens and security interests granted therein and the priority thereof, and
the continued enforceability thereof, is hereby acknowledged, confirmed and
ratified by Borrower and Guarantor. By execution of this Amendment, Guarantor
acknowledges and agrees that it remains jointly and severally liable for all of
the debts and obligations of Borrower and all debts of Borrower to Guarantor
shall remain subordinate and inferior in all respects to the indebtedness
evidenced by the Note.
11. ARBITRATION. EXCEPT FOR "CORE PROCEEDINGS" UNDER THE UNITED STATES
BANKRUPTCY CODE, THE PARTIES AGREE TO SUBMIT TO BINDING ARBITRATION ALL CLAIMS,
DISPUTES AND CONTROVERSIES BETWEEN OR AMONG THEM, WHETHER IN TORT, CONTRACT OR
OTHERWISE (AND THEIR RESPECTIVE EMPLOYEES, OFFICERS, DIRECTORS, ATTORNEYS, AND
OTHER AGENTS) ARISING OUT OF OR RELATING TO IN ANY WAY THIS AMENDMENT OR THE
LOAN DOCUMENTS. ANY ARBITRATION PROCEEDING WILL (A) PROCEED IN PHOENIX, ARIZONA;
(B) BE GOVERNED BY THE FEDERAL ARBITRATION ACT (TITLE 9 OF THE UNITED STATES
CODE); AND (C) BE CONDUCTED IN ACCORDANCE WITH THE COMMERCIAL ARBITRATION RULES
OF THE AMERICAN ARBITRATION ASSOCIATION ("AAA"). THIS ARBITRATION REQUIREMENT
DOES NOT LIMIT THE RIGHT OF ANY PARTY TO (I) FORECLOSE AGAINST REAL OR PERSONAL
PROPERTY COLLATERAL; (II) EXERCISE SELF-HELP REMEDIES RELATING TO COLLATERAL OR
PROCEEDS OF COLLATERAL SUCH AS SETOFF OR REPOSSESSION; OR (III) OBTAIN
PROVISIONAL ANCILLARY REMEDIES SUCH AS REPLEVIN, INJUNCTIVE RELIEF, ATTACHMENT
OR THE APPOINTMENT OF A RECEIVER, BEFORE, DURING OR AFTER THE PENDENCY OR ANY
ARBITRATION PROCEEDING. THIS EXCLUSION DOES NOT CONSTITUTE A WAIVER OF THE RIGHT
OR OBLIGATION OF ANY PARTY TO SUBMIT ANY DISPUTE TO ARBITRATION, INCLUDING THOSE
ARISING FROM THE EXERCISE OF THE ACTIONS DETAILED IN CLAUSES (I), (II) AND (III)
ABOVE. ANY ARBITRATION PROCEEDING WILL BE BEFORE A SINGLE ARBITRATOR SELECTED
ACCORDING TO THE COMMERCIAL ARBITRATION RULES OF THE AAA. THE ARBITRATOR WILL BE
A NEUTRAL ATTORNEY WHO HAS PRACTICED IN THE AREA OF COMMERCIAL LAW FOR A MINIMUM
OF TEN YEARS. THE ARBITRATOR WILL DETERMINE WHETHER OR NOT AN ISSUE IS
ARBITRABLE AND WILL GIVE EFFECT TO THE STATUTES OF LIMITATION IN DETERMINING ANY
CLAIM. JUDGMENT UPON THE AWARD RENDERED BY THE ARBITRATOR MAY BE ENTERED IN ANY
COURT HAVING JURISDICTION. IN ANY ARBITRATION PROCEEDING, THE ARBITRATOR WILL
DECIDE (BY DOCUMENTS ONLY OR WITH A HEARING AT THE ARBITRATOR'S DISCRETION) ANY
PRE-HEARING MOTIONS WHICH ARE SIMILAR TO MOTIONS TO DISMISS FOR FAILURE TO STATE
A CLAIM OR
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MOTIONS FOR SUMMARY ADJUDICATION. IN ANY ARBITRATION PROCEEDING DISCOVERY WILL
BE PERMITTED AND WILL BE GOVERNED BY THE ARIZONA RULES OF CIVIL PROCEDURE. ALL
DISCOVERY MUST BE COMPLETED NO LATER THAN 20 DAYS BEFORE THE HEARING DATE AND
WITHIN 180 DAYS OF THE COMMENCEMENT OF ARBITRATION PROCEEDINGS. ANY REQUESTS FOR
AN EXTENSION OF THE DISCOVERY PERIODS, OR ANY DISCOVERY DISPUTES, WILL BE
SUBJECT TO FINAL DETERMINATION BY THE ARBITRATOR UPON A SHOWING THAT THE REQUEST
FOR DISCOVERY IS ESSENTIAL FOR THE PARTY'S PRESENTATION AND THAT NO ALTERNATIVE
MEANS FOR OBTAINING INFORMATION IS AVAILABLE. THE ARBITRATOR SHALL AWARD COSTS
AND EXPENSES OF THE ARBITRATION PROCEEDING IN ACCORDANCE WITH THE PROVISIONS OF
THIS AGREEMENT. EXCEPT AS OTHERWISE PROVIDED HEREIN, THIS AGREEMENT SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF ARIZONA,
WITHOUT REGARD TO ITS CONFLICT OF LAWS RULES.
------- ------- -------
INITIAL INITIAL INITIAL
[THE REMAINDER OF THIS PAGE
IS LEFT INTENTIONALLY BLANK]
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IN WITNESS WHEREOF, this Amendment is executed as of the date first above
written.
BORROWER:
CAMELBACK PLAZA DEVELOPMENT L.C.,
an Arizona limited liability company
By: Performance Camelback
Development Corp., an Arizona
corporation
Managing Member
By: /s/ James W. Brown
-----------------------
Name: James W. Brown
-----------------------
Title: Secretary
-----------------------
GUARANTOR:
PERFORMANCE INDUSTRIES, INC., an Ohio
corporation
By: /s/ James W. Brown
-----------------------
Name: James W. Brown
-----------------------
Title: Treasurer
-----------------------
LENDER:
NORWEST BANK ARIZONA, NATIONAL
ASSOCIATION, a national banking
association
By: /s/ Timothy J. Stouffer
----------------------------
Name: Timothy J. Stouffer
----------------------------
Title: Vice President
----------------------------
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STATE OF ARIZONA )
) ss.
County of Maricopa )
On this 14th day of March, 1996, before me, the undersigned notary
public, in and for said state, personally appeared James W. Brown, the Secretary
of Performance Camelback Development Corp., an Arizona corporation, the managing
member of CAMELBACK PLAZA DEVELOPMENT L.C., an Arizona limited liability
company, personally known to me (or proved to me on the basis of satisfactory
evidence) to be the person whose name is subscribed to the within instrument and
acknowledged to me that he executed the same in his authorized capacity, and
that by his signature on the instrument the person, or the entity upon behalf of
which the person acted, executed the instrument.
WITNESS my hand and official seal.
/s/ Terri L. Smith
------------------
Notary Public
My Commission Expires:
August 18, 1999
- ---------------
STATE OF ARIZONA )
) ss.
County of Maricopa )
On this 14th day of March, 1996, before me, the undersigned notary
public, in and for said state, personally appeared James W. Brown, the Treasurer
of PERFORMANCE INDUSTRIES, INC., an Ohio corporation, personally known to me (or
proved to me on the basis of satisfactory evidence) to be the person whose name
is subscribed to the within instrument and acknowledged to me that he executed
the same in his authorized capacity, and that by his signature on the instrument
the person, or the entity upon behalf of which the person acted, executed the
instrument.
WITNESS my hand and official seal.
/s/ Terri L. Smith
------------------
Notary Public
My Commission Expires:
August 18, 1999
- ---------------
-17-
STATE OF ARIZONA )
) ss.
County of Maricopa )
On this 14th day of March, 1996, before me, the undersigned notary
public, in and for said state, personally appeared Timothy J. Stouffer, the Vice
President of NORWEST BANK ARIZONA, NATIONAL ASSOCIATION, a national banking
association, personally known to me (or proved to me on the basis of
satisfactory evidence) to be the person whose name is subscribed to the within
instrument and acknowledged to me that he executed the same in his authorized
capacity, and that by his signature on the instrument the person, or the entity
upon behalf of which the person acted, executed the instrument.
WITNESS my hand and official seal.
/s/ Terri L. Smith
------------------
Notary Public
My Commission Expires:
August 18, 1999
- ---------------
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EXHIBIT "D"
BORROWER COMPLIANCE CERTIFICATE
The undersigned, the [President/Chief Financial Officer] of Performance
Camelback Development Corp., the managing member of Camelback Plaza Development
L.C., an Arizona limited liability company (the "Company"), hereby certifies as
follows:
1. I am familiar with the agreements and instruments evidencing,
securing or otherwise relating to the Retail Phase Construction Loan Agreement
dated as of June 24, 1994 between the Company and Caliber Bank ("Caliber"), as
amended, including, without limitation, the Retail Phase Promissory Note dated
June 24, 1994 from the Company in favor of Caliber in the original amount of
$3,000,000, as amended (the "Note"), and the Retail Phase Leasehold Construction
Deed of Trust and Security Agreement with Assignment of Rents and Fixture Filing
dated June 24, 1994 from the Company in favor of Caliber, recorded on September
26, 1994 as Instrument No. 94-0702374, Records of Maricopa County, Arizona, as
amended (collectively, the "Loan Documents").
2. I am familiar with the Ground Lease dated December 15, 1976 between
Bill J. Davis and Betty Davis, Ida E. Davis, William S. Davis and Robert J.
Davis (collectively, "Ground Lessor"), as Lessor, and Douglas P. Simpson and
Janice C. Simpson, d/b/a Bayshore Development Company ("Ground Lessee"), as
Lessee, as amended (the "Ground Lease").
3. In connection with this Certificate, I have reviewed the books and
records of the Company and I am familiar with the affairs of the Company.
4. The financial statements provided together with this Certificate
present fairly, in all material respects, the financial position of the Company
as of [insert appropriate date] and the results of its operations and cash flows
for the period then ended in conformity with generally accepted accounting
principles.
5. To the undersigned knowledge, after diligent investigation, except
as indicated below, the Company is not in default of any of its representations,
warranties, covenants or agreements under the Loan Documents or the Ground Lease
[if any Event of Default, or act, omission or event that with the passage of
time and/or giving of notice would constitute an Event of Default, has occurred
and is continuing, set forth details of such Event of Default or incipient Event
of Default below and the action which the Company proposes to take with respect
thereto]:
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DATE: , 199 .
----------------------------------- ----
-------------------------------
[Name], [title]
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EXHIBIT "E"
GUARANTOR COMPLIANCE CERTIFICATE
The undersigned, the [President/Chief Financial Officer] of Performance
Industries, Inc., an Ohio corporation (the "Company"), hereby certifies as
follows:
1. I am familiar with the agreements and instruments evidencing,
securing or otherwise relating to the Retail Phase Construction Loan Agreement
dated as of June 24, 1994 between the Company and Caliber Bank ("Caliber"), as
amended, including, without limitation, the Retail Phase Promissory Note dated
June 24, 1994 from the Company in favor of Caliber in the original amount of
$3,000,000, as amended (the "Note"), and the Retail Phase Leasehold Construction
Deed of Trust and Security Agreement with Assignment of Rents and Fixture Filing
dated June 24, 1994 from the Company in favor of Caliber, recorded on September
26, 1994 as Instrument No. 94-0702374, Records of Maricopa County, Arizona, as
amended, and the Unconditional Guarantee of Payment dated June 24, 1994 from the
Company in favor of Caliber (collectively, the "Loan Documents").
2. In connection with this Certificate, I have reviewed the books and
records of the Company and I am familiar with the affairs of the Company.
3. The financial statements provided together with this Certificate
present fairly, in all material respects, the financial position of the Company
as of [insert appropriate date] and the results of its operations and cash flows
for the period then ended in conformity with generally accepted accounting
principles.
4. To the undersigned knowledge, after diligent investigation, except
as indicated below, the Company is not in default of any of its representations,
warranties, covenants or agreements under the Loan Documents [if any Event of
Default, or act, omission or event that with the passage of time and/or giving
of notice would constitute an Event of Default, has occurred and is continuing,
set forth details of such Event of Default or incipient Event of Default below
and the action which the Company proposes to take with respect thereto]:
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
DATE: , 199 .
------------------------------------ ----
-------------------------------
[Name], [title]
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