EXHIBIT 10.8
LOAN AGREEMENT
THIS LOAN AGREEMENT is made entered into this 16th day
of May, 1996, by and between REPUBLIC BANK, a Florida banking
corporation (the "Lender") and DECADE COMPANIES INCOME
PROPERTIES - A LIMITED PARTNERSHIP, a Wisconsin limited
partnership authorized to do business in the State of Florida
(the "Borrower"), and is made in reference to the following
facts:
(A) On or about the date hereof, the Lender has made a
secured loan to the Borrower in the original principal amount of
SIX MILLION SEVEN HUNDRED THOUSAND AND NO/100 DOLLARS
($6,700,000.00) (the "Loan").
(B) In connection with the Loan, the Borrower has
executed and delivered to Lender, among other things, a note (the
"Note"). The Borrower has also executed and delivered to Lender
a Mortgage, Assignment of Rents, Leases, Contracts, Accounts
Receivable, Accounts and Deposit Accounts, Security Agreement,
Environmental Compliance and Indemnity Agreement, UCC-1 Financing
Statements and numerous other documents securing the Loan,
(collectively the "Instruments of Security"). The Note and
Instruments of Security collectively comprise the "Loan
Documents".
(C) The Lender has required the execution and
delivery of this Agreement by the Borrower as a condition to
making the Loan to Borrower, and Borrower is agreeable to such.
NOW THEREFORE, for and in consideration of the mutual
covenants and conditions contained herein and other valuable
consideration, the receipt and adequacy of which is hereby
acknowledged, the parties covenant and agree as follows:
ARTICLE I - INTRODUCTORY PROVISIONS
1.1 Recitals. The statements contained in the
recitals of fact set forth above (the "Recitals") are true and
correct, and the Recitals by this reference are made a part of
this Agreement.
1.2 Exhibits. All exhibits attached to this Agreement
are by this reference made a part hereof.
1.3 Abbreviations and Definitions. The following
abbreviations and definitions will be used for purposes of this
Agreement:
(a) The abbreviations for the parties set forth
in the Preamble will be used for purposes of this Agreement.
(b) The abbreviations and definitions set forth
in the Recitals will be used for purposes of this Agreement.
ARTICLE II - LOAN
2.1 Loan. On or about the date hereof, Borrower has
executed the Note in favor of Lender in the original principal
amount of Loan. The principal that is disbursed by Lender to
Borrower shall bear interest and be repaid in the manner set
forth in the Note.
2.2 Purpose. The purpose of the Loan evidenced by the
Note is to provide funds for the refinancing of existing
indebtedness encumbering the real property that will serve as
partial security for the Loan.
ARTICLE III - FINANCIAL AND OPERATIONAL DISCLOSURES
At all times during the term of the Loan, the Borrower
shall provide to Lender the following:
(a) No later than forty-five (45) days after the end
of Borrower's fiscal quarters, the Borrower shall provide to
Lender its unaudited management-prepared quarterly financial
statements, including, without limitation, a balance sheet,
profit and loss statement, and statement of cash flows, with
supporting schedules, along with a current rent roll.
(b) No later than ninety (90) days after the end of
each fiscal year of Borrower, the Borrower shall provide to
Lender its: (i) annual compiled financial statements reflecting
its operations and that of its subsidiaries, including, without
limitation, a balance sheet, profit and loss statement and
statement of cash flows, with supporting schedules; and (ii) its
contingency liability listings.
(c) No later than thirty (30) days following the
submission by Borrower and DECADE COMPANIES, a Wisconsin general
partnership ("Decade") of their tax returns and all supporting
documentation therefor to the Internal Revenue Service, Borrower
and Decade shall provide copies of all such documentation to
Lender.
All of the foregoing reports and information must be provided by
Borrower and Decade to Lender in form and content acceptable to
Lender in its reasonable discretion and shall be certified to
Lender as to completeness and accuracy by Borrower or Decade, as
the case may be. All financial statements shall be prepared in
accordance with generally accepted accounting principles
consistently applied. Additionally, Borrower and Decade shall
furnish such additional financial information or reports as
Lender shall reasonably request from time to time during the term
of the Loan.
ARTICLE IV - REPRESENTATIONS AND WARRANTIES
The Borrower represents and warrants to the Lender as
follows:
4.1 Organization, Standing, Corporate Power. The
Borrower is a limited partnership duly formed, validly existing
and in good standing under the laws of the State of Wisconsin,
and is authorized to do business in the State of Florida. The
Borrower has appropriate power and authority to own its
properties and to carry on its business as now being conducted,
and the Borrower has appropriate power and authority to execute
and perform this Agreement and to deliver the Note and all other
documents, instruments and agreements provided for herein.
4.2 This Agreement. The execution and performance by
the Borrower of this Agreement, the borrowings hereunder, and the
execution and delivery of the Note and all other documents,
instruments and agreements provided for herein: (a) have been
duly authorized by all requisite partnership action; (b) will not
violate any provision of law or of the Borrower's Partnership
Agreement as amended to the date hereof; and (c) will not violate
or be in conflict with, result in a breach of, or constitute a
default under any indenture, agreement and other instrument to
which the Borrower is a party or by which it or any of its
properties is bound, or any order, writ, injunction or decree of
any court or governmental institution.
4.3 Litigation. There are no actions, suits or
proceedings pending, or to the knowledge of the Borrower,
threatened against or adversely affecting the Borrower at law or
in equity or before or by any federal agency or instrumentality,
domestic or foreign, which involve any of the transactions herein
contemplated or the possibility of any judgment or liability
which may result in any material and adverse change in the
business, operations, prospects, property or assets, or in the
condition, financial or otherwise, of the Borrower. The Borrower
is not in default with respect to any judgment, order, writ,
injunction, decree, or, to Borrower's knowledge, rule or
regulation of any court, or federal, state, municipal or other
governmental department.
4.4 Financial Statements. The Borrower has heretofore
furnished to the Lender balance sheets, income statements, and
other financial information which are correct and complete and
accurately present the financial condition and the results of the
operation of the Borrower as of the dates thereof. Since the
date of the last furnishing of said financial statements, there
has been no material adverse change in the financial condition of
the Borrower.
4.5 Taxes. The Borrower has filed or caused to be
filed all federal and state tax returns which are required to be
filed by applicable law, and Borrower has paid or caused to be
paid all taxes as shown on said returns or on any assessment
received by it and not being contested in good faith, to the
extent that such taxes have become due.
4.6 Other Instruments. Except as reflected on the
financial statements described in Section 4.4 hereof, the
Borrower is not a party to any agreement or instrument or subject
to any charter or other restrictions adversely affecting its
business, properties or assets, operations or condition,
financial or otherwise.
4.7 Property and Assets. The Borrower has good and
marketable title to all the property and assets reflected on the
most recent financial statements furnished to the Lender, except
such as have been disposed of in the ordinary course of business
since the date of said financial statements, and all such
property and assets are free and clear of mortgages, pledges,
liens, charges or other encumbrances, except as are reflected on
the financial statements.
4.8 Regulation U. No part of the proceeds of the Loan
will be used to purchase or carry, or to reduce or retire any
loan incurred to purchase or carry, any margin stocks (within the
meaning of Regulation U of the Board of Governors of the Federal
Reserve System) or to extend credit to others for the purpose of
purchasing or carrying any such margin stocks. The Borrower is
not engaged in the business of extending credit, nor is one of
the Borrower's important activities extending of credit, for the
purpose of purchasing or carrying such margin stocks. If
requested by the Lender, the Borrower shall furnish to the Lender
in connection with any loan hereunder a statement in conformity
with the requirements of Federal Reserve Form U-1 referred to in
said regulation.
4.9 Continuity of Representations and Warranties. All
of the foregoing representations and warranties shall be true and
correct at the time of the making of each advance under the Loan
pursuant to this Agreement.
ARTICLE V - CONDITIONS PRECEDENT
The obligation of the Lender to make the Loan hereunder
is subject to the following conditions precedent:
(a) Representations and Warranties. In order to
induce the Lender to enter into this Agreement and to make the
Loan herein provided for and disbursements thereunder, the
Borrower represents and warrants to the Lender that on the date
of each borrowing or disbursement hereunder, the representations
and warranties set forth in this Agreement shall be true and
correct on and as of the date of such borrowing or disbursement,
with the same force and effect as though such representations and
warranties had been made on and as of such date.
(b) No Default. At the time of each borrowing or
disbursement hereunder, the borrower has observed and performed
all of the terms, conditions and agreements set forth herein on
its part to be observed or performed and no "Event of Default"
(as that term is defined below), nor any event which, upon notice
or lapse of time or both, would constitute such an Event of
Default, shall have occurred and be continuing.
(c) Liens and Encumbrances. The properties and assets
of the Borrower, real, personal and mixed, are not subject to any
liens, encumbrances or security interests or outstanding
financing statements, whether filed or unfiled, except for liens
for taxes not yet due and liens, encumbrances or security
interests on personal or real property as reflected in the
Borrower's financial statements heretofore delivered to Lender or
which shall be paid out of the proceeds of the Loan.
(d) Litigation. There are no actions, suits,
proceedings or claims pending or threatened against or affecting
the Borrower, the result of which might substantially affect the
financial condition, business or operations of the Borrower.
ARTICLE VI - AFFIRMATIVE COVENANTS
The Borrower covenants and agrees with the Lender that
from the date hereof and so long as the Loan is outstanding,
unless the Lender shall otherwise consent in writing deliver to
the Borrower, it will:
6.1 Partnership Existence. Do or cause to be done all
things necessary to preserve, renew and keep in full force and
effect Borrower's partnership existence, and all Borrower's
rights, licenses, permits and franchises required at the date
hereof, or which may be required in the future conduct of its
business, and comply with all laws and regulations applicable to
it that materially affect the Borrower, and conduct and operate
its business in the same lines and in substantially the same
manner in which presently conducted and operated, and at all
times maintain, preserve and protect all property used and useful
in the conduct of its business with respect to the Property, and
maintain same in good working order and condition.
6.2 Insurance. Keep the Property adequately insured
at all times by financially sound and reputable insurers, and
maintain such insurance to such extent and against such risks,
including liability insurance, fire, windstorm, and other risks
insured against by extended coverage as is acceptable to Lender
in its reasonable discretion. Borrower will furnish Lender with
a copy of such insurance policies containing an endorsement in
favor of Lender as loss payee as its interest may appear.
6.3 Obligations and Taxes. Pay all indebtedness and
obligations promptly and in accordance with normal terms, and pay
and discharge promptly all taxes, assessments and governmental
charges or levies imposed upon it or in respect of its property,
before the same shall become in default, as well as all lawful
claims for labor, materials and supplies or otherwise which, if
unpaid, might become a lien or charge upon such properties or any
part thereof.
6.4 Records. The Borrower will keep and maintain full
and accurate rent rolls and accounts and records of its
operations with respect to the Property, and will permit Lender
and its designated officers, employees, agents and
representatives, to have access thereto and to make examination
thereof at all reasonable times, to make audits, and to inspect
and otherwise check the Property.
ARTICLE VII - NEGATIVE COVENANTS
The Borrower covenants and agrees with Lender that from
the date hereof and so long as the Loan is outstanding, unless
the Lender shall otherwise consent in writing deliver to the
Borrower (which consent will not be unreasonably withheld), it
will not:
7.1 Indebtedness. With respect to the Property,
create or incur any indebtedness except in the ordinary course of
business for goods and services, and will not incur, create,
assume or permit to exist any indebtedness or liability for
borrowed money or any indebtedness evidenced by notes, bonds,
debentures or similar obligations, except for presently existing
indebtedness set forth in the financial statements heretofore
delivered to Lender and the Note evidencing the Loan described
herein.
7.2 Loans. With respect to the Property, guarantee,
endorse or assume any debt, or pledge its credit in any manner,
directly or indirectly, except in favor of Lender or in the
ordinary course of business.
7.3 Liens. Incur, create, assume or permit to exist
any mortgage, pledge, lien, charge, security interest or other
encumbrance of any nature whatsoever on the Property, except to
Lender, other than: (a) liens for taxes or assessments and
similar charges either: (i) not delinquent; or (ii) being
contested in good faith by appropriate proceedings and as to
which the Borrower shall have set aside on its books adequate
reserves; and (b) currently existing indebtedness consented to in
writing by Lender.
7.4 Change of Control. Make a material management or
ownership change in the composition of Decade, which effectively
changes the control of the Borrower.
7.5 Compliance with Laws Generally. Be in violation
of any law, ordinance, governmental rules or regulations to which
Borrower is subject, or fail to obtain any licenses, permits,
franchises or other governmental authorizations necessary to the
ownership of the Property, or to the conduct of its business,
which violation or failure to obtain might materially adversely
affect the business, prospects, profits, properties or condition
(financial or otherwise) of Borrower.
ARTICLE VIII - COLLATERAL
As security for the full and timely payment of the
Note, including future advances, together with interest thereon,
as well as any renewals, modifications or extensions thereof, and
to secure performance of all obligations of Borrower to Lender,
however or whenever created, Borrower covenants and agrees that
it has previously granted to Lender a first security interest
subject to no other liens, encumbrances or security interests in
and to all of the items of security as are set forth in the
Instruments of Security (collectively the "Collateral").
ARTICLE IX - DEFAULTS AND REMEDIES
9.1 Events of Default. If any one or more of the
following events (herein called "Events of Default") shall occur
for any reason whatsoever (and whether such occurrences shall be
voluntary or involuntary, or come about or be effected by
operation of law or pursuant to or in compliance with any
judgment, decree or order of any court, or any order, rule or
regulation of any administrative or governmental body), then
Lender shall be entitled to the remedies set forth in Section 9.2
of this Agreement. The Events of Default shall include, but not
be limited to, the following:
(a) Any representation or warranty made herein or
in any report, certificate, financial statement or other
instrument furnished in connection with this Agreement or the
borrowing hereunder shall prove to be false or misleading in any
material respect;
(b) Default beyond the applicable curative period
shall occur in the payment of interest or principal on any
indebtedness referred to herein, including the Note, when and as
the same shall become due and payable, whether at the due date
thereof or by acceleration or otherwise;
(c) Any default beyond the applicable curative
period shall occur in the due observance or performance of any
covenant, agreement or other provision of this Agreement or the
Loan Documents other than for the payment of money, including
without limitation the invalidation or loss of priority of any
lien or assignment contemplated to be given to Lender pursuant to
the Loan Documents;
(d) The Borrower shall: (i) apply for or consent
to the appointment of a receiver, trustee in bankruptcy for
benefit of creditors, or liquidator of it or any of its property;
(ii) admit in writing its inability to pay its debts as they
mature; (iii) make a general assignment for the benefit of
creditors; (iv) be adjudicated a bankrupt or insolvent; (v) file
a voluntary petition in bankruptcy, or a petition or an answer
seeking reorganization or an arrangement with creditors, or
seeking to take advantage of any bankruptcy, reorganization,
insolvency, readjustment of debt, dissolution or liquidation law
or statue or an answer admitting an act of bankruptcy alleged in
a petition filed against it in any proceeding under any such law;
or (vi) take any action for the purposes of effecting any of the
foregoing;
(e) An order, judgment or decree shall be entered
against the Borrower with the application, approval or consent of
the Borrower by any court of competent jurisdiction, approving a
petition seeking its reorganization or appointing a receiver,
trustee or liquidator of the Borrower, or of all or a substantial
part of the assets thereof, and such order, judgment or decree
shall continue unstayed and in effect for any period of sixty
(60) days from the date of entry thereof; or
(f) Borrower's corporate existence shall be
dissolved or terminated, whether voluntarily or involuntarily.
9.2 Remedy. Upon the occurrence of any Event of
Default, Lender may, at its option, declare all indebtedness of
principal and interest due and payable, whereupon the Note
(notwithstanding any provisions hereof or thereof) shall be
immediately due and payable, and Lender shall have and may
exercise from time to time any and all rights and remedies
available to it under any applicable law; and Borrower shall
promptly pay all costs of Lender of collection of any and all
liabilities, and enforcement of rights hereunder, including
reasonable attorney's fees, and legal expenses of any repairs to
any of the Collateral, and expenses of repairs to any realty or
other property to which any of the Collateral may be affixed.
Any notice of sale, disposition or other intended action by
Lender sent to Borrower, at the address of Borrower specified
herein or at any other address shown on the records of the Lender
at least ten (10) days prior to such action, shall constitute
reasonable notice to Borrower. Expenses of retaking, holding,
preparing for sale, selling, or the like shall include Lender's
reasonable attorney's fees and legal expenses. All rights,
powers and remedies contained herein or in any other agreement,
instrument or document executed in connection herewith are
cumulative.
ARTICLE X - MISCELLANEOUS
10.1 Notices. All notices, requests or other
communications to be given to the Borrower or the Lender
hereunder shall be sufficiently given and shall be deemed given,
when given by hand-delivery to such person at the street address
of such person set forth below, or when mailed by registered or
certified mail, postage prepaid, addressed as follows:
If to the Borrower: Brookfield Lakes Corporate Center
000 Xxxxxxx Xxxxxxxxx, Xxxxx 000
Xxxxxxxxxx, XX 00000
If to Lender: 000 Xxxxxx Xxxxxx Xxxxxxxxx
Xx. Xxxxxxxxxx, XX 00000
The parties hereto may, by notice given under this Section 10.1
to the others, designate any further or different addresses to
which subsequent notices, requests or other communications shall
be sent.
10.2 Survival of Representations. All covenants,
agreements, representations and warranties made herein and in the
certificates delivered pursuant hereto shall survive the making
by Lender of the Loan herein contemplated and the execution and
delivery to Lender of the Note evidencing such Loan and shall
continue in full force and effect so long as any indebtedness
created hereunder is outstanding and unpaid. All covenants and
agreements by or on behalf of either party which are contained or
incorporated in this Agreement shall bind and inure to the
benefit of the successors and assigns of both parties hereto.
10.3 Effect of Delay. Neither any failure nor any
delay on the part of Lender in exercising any right, power or
privilege hereunder or under the Note shall operate as a waiver
thereof, nor shall a single or partial exercise thereof preclude
any other or further exercise or the exercise of any other right,
power or privilege.
10.4 Expenses. Subject to the terms of the Loan
Commitment Letter, the Borrower will pay, and indemnify and hold
harmless the Lender against any liability with respect to, all
out-of-pocket expenses reasonably incurred by Lender in
connection with the preparation of this Agreement or the
borrowings hereunder. Additionally, the Borrower will pay and
indemnify and hold harmless the Lender against any liability with
respect to, and all out-of-pocket expenses reasonably incurred by
Lender in connection with the enforcement of the rights of Lender
in connection with this Agreement, or with the Loan made or the
Note issued hereunder, including but not limited to the fees of
and expenses of counsel for Lender. The provisions of this
Section 10.4 shall survive the execution of this Agreement and
the repayment of the Note.
10.5 Modification and Waivers. No modification or
waiver of any provision of this Agreement or of the Note nor
consent to any departure by the Borrower therefrom shall in any
event be effective unless the same shall be in writing, and then
such waiver or consent shall be effective only in the specific
instance and for the purpose for which given. No notice to or
demand on the Borrower in any case shall thereby entitle the
Borrower to any other or further notice or demand in the same,
similar or other circumstances.
10.6 Business Day. Should any installment on the Note
become due and payable on other than a business day of the
Lender, the maturity thereof shall be extended to the next
succeeding business day with interest on the principal amount
thereof at the rate set forth therein.
10.7 Remedies Cumulative. Any rights or remedies of
the Lender hereunder or under the Note or any other security
agreement or writing shall be cumulative and in addition to every
other right or remedy contained therein or herein, whether now
existing or hereafter at law or in equity or by statute or
otherwise.
10.8 Binding Agreement. This Agreement shall be
binding upon Borrower and its successors and assigns and the
terms hereof shall inure to the benefit of Lender and its
successors and assigns.
10.9 Exhibits. All references to "Exhibits" contained
herein are references to exhibits attached to the Agreement, the
terms and conditions of which are made a part hereof for all
purposes, the same as if set forth herein verbatim.
10.10 Number and Gender of Words. Whenever herein the
singular number is used, the same shall include the plural where
appropriate, and words of any gender shall include each other
gender where appropriate.
10.11 Captions. The captions, headings, and
arrangements used in this Agreement are for convenience only and
do not in any way affect, limit, amplify, or modify the terms and
provisions hereof.
10.12 Invalid Provisions. If any provision of this
Agreement is held to be illegal, invalid, or unenforceable under
present or future laws effective during the term of this
Agreement, such provision shall be fully severable, and this
Agreement shall be construed and enforced as if such illegal,
invalid, or unenforceable provision had never comprised a part.
10.13 All Loans Constitute One Loan. All loans and/or
advances made hereunder shall constitute one loan and the
obligations of such loans and/or advances shall constitute one
obligation secured by the Collateral provided for herein.
10.14 Construction. This Agreement shall be governed
by and construed in accordance with the laws of the State of
Florida, regardless of the state in which it is executed.
10.15 Nonrecourse. The obligations of the Borrower
hereunder are subject to the Nonrecourse provisions contained in
the Mortgage.
IN WITNESS WHEREOF, the parties hereto have executed
this Agreement the day and year first above written.
Signed, sealed and delivered REPUBLIC BANK, a Florida banking
in the presence of: corporation
__________________________ By:___________________________________
Its ________________ President
__________________________ (CORPORATE SEAL)
As to Lender
DECADE COMPANIES INCOME PROPERTIES-
A LIMITED PARTNERSHIP, a Wisconsin
limited partnership authorized to do
__________________________ business in the State of Florida, by
its sole general partner:
/s/_______________________ By: DECADE COMPANIES, a Wisconsin
As to Borrower general partnership, by its
managing general partner:
By: /s/______________________________
XXXXXXX XXXXXXXXXX
STATE OF FLORIDA )
COUNTY OF _______ )
The foregoing instrument was acknowledged before me this ___
day of ________________, 1996, by _______________________, the _______
__________ President of REPUBLIC BANK, a Florida banking corporation,
on behalf of the corporation.
Personally Known __________ OR Produced Identification
Type of Identification Provided ______________________
___________________________________
SIGNATURE
___________________________________
NAME LEGIBLY PRINTED,
TYPEWRITTEN OR STAMPED
NOTARY PUBLIC
(SEAL)
My Commission Expires:
STATE OF WISCONSIN )
COUNTY OF MILWAUKEE )
The foregoing instrument was acknowledged before me this
15th day of May, 1996, XXXXXXX XXXXXXXXXX, as Managing General Partner
of DECADE COMPANIES, a Wisconsin general partnership, the sole partner
of DECADE COMPANIES INCOME PROPERTIES - A LIMITED PARTNERSHIP, a
Wisconsin limited partnership authorized to do business in the State
of Florida, on behalf of said limited partnership.
Personally Known __________ OR Produced Identification
Type of Identification Provided ______________________
___________________________________
SIGNATURE
/s/________________________________
NAME LEGIBLY PRINTED,
TYPEWRITTEN OR STAMPED
NOTARY PUBLIC
(SEAL)
My Commission Expires:
