Exhibit 10.1
FIRST AMENDMENT TO FORBEARANCE AGREEMENT
 

This First Amendment to Forbearance Agreement (this “Amendment”) is made as of
this __ day of July, 2007, by and among LASALLE BANK NATIONAL ASSOCIATION, AS
TRUSTEE OF MARATHON REAL ESTATE CDO 2006-1 GRANTOR TRUST, successor-in-interest
to Marathon Structured Finance Fund, L.P., a Delaware limited partnership (the
“Lender”). SOUTH BEACH RESORTS, LLC, a Florida limited liability company (the
“Borrower”), FRED PAUZAR, an individual resident of the State of Florida
(“Pauzar”), and MALCOLM WRIGHT, an individual resident of the State of Florida
(“Wright”, and together with Pauzar, the “Principals”, and the Principals,
together with Borrower, the “Borrowing Parties”).

RECITALS
 
A. Lender and Borrower are parties to that certain Loan Agreement dated as of
June 30, 2005 (the “Loan Agreement”), pursuant to which Lender agreed to make a
loan to Borrower (the “Loan”) in the amount of up to Nine Million and NO/100
Dollars ($9,000,000.00).

B. The Loan is evidenced by that certain Promissory Note dated June 30, 2005
(the “Note”), and is secured by the lien of that certain Mortgage, Assignment of
Rents and Security Agreement dated June 30, 2005 and recorded among the land
records of Dade County, Florida on July 11, 2005 in Official Records Book 23557,
Page 3073 (the “Mortgage”).

C. Payment of certain obligations of Borrower pursuant to the Loan Documents is
guaranteed by the Principals pursuant to the terms of, inter alia, that certain
Guaranty (Exceptions to Nonrecourse Liability) dated as of June 30, 2005 (the
“Guaranty”). As used herein, the term “Loan Documents”) shall mean the Loan
Agreement, the Note, the Mortgage, the Guaranty and any and all other documents
evidencing, securing and/or governing the Loan whether now existing or hereafter
executed and delivered.

D. The Loan matured by its terms on January 11, 2007 and Borrower failed to
repay the Loan in accordance with the terms of and as required by the Loan
Documents (the “Existing Default”).

E. Pursuant to the terms of that certain Forbearance Agreement among Lender and
the Borrowing Parties dated as of February 2, 2007 (as amended and modified
hereby, the “Forbearance Agreement”), Lender agreed, among other things, to
forbear from exercising any right or remedy against the Borrowing Parties with
respect to the Existing Default during the Initial Forbearance Period and the
Extended Forbearance Period.

F. Borrower has requested that Lender continue to waive the Existing Default,
and Lender has conditionally agreed to waive such Existing Default, on the terms
set forth below provided, however, that in the event that any Event of Default
or Other Default occurs during the Forbearance Period or prior to the payment in
full of the Obligations of the Borrower to Lender, such waiver shall be null and
void.

NOW, THEREFORE, in consideration of the mutual undertakings set forth below and
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, and intending to be legally bound hereby, the parties agree
as follows:

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AGREEMENT

1. Incorporation of Recitals; Defined Terms. Borrower and Lender agree that the
Recitals above are a part of this Amendment. Unless otherwise expressly defined
in this Amendment, terms defined in the Forbearance Agreement or in the Loan
Agreement shall have the same meaning under this Amendment.

(a) As used herein, the term “Forbearance Period” shall mean the Initial
Forbearance Period, the Extended Forbearance Period, or the Second Extended
Forbearance Period, as the case may be.

2. Acknowledgements. Borrowing Parties hereby acknowledge, ratify, admit,
stipulate and agree, without precondition or qualification, as follows:

(a) Each of the Recitals contained above in this Amendment is true, correct and
complete in all material respects.

(b) Borrower and Principals (i) entered into the Loan Documents to which they
are parties, and (ii) are entering into this Amendment of their own free will,
without coercion or threat of any kind from Lender or from any other Person,
fully understanding the terms hereof (including the waiver of certain material
rights afforded by law), and are fully aware that they may have potentially
advantageous alternatives to entering into this Amendment. Borrower and
Principals acknowledge, stipulate and agree that any other alternative would
present a material risk to their detriment.

(c) The Loan Documents constitute valid and binding obligations of Borrower and
Principals, enforceable against each of them in accordance with their respective
terms.

(d) As of July 11, 2007, the Obligations shall consist of the following:

Principal
$6,248,900.00
Interest Due
$64,441.78
Tax Escrow
$6,940.00
Insurance Escrow
$8,500.00

In addition, Borrower is obligated to pay to and reimburse Lender for all
amounts incurred in connection with the Obligations and/or the Existing Default,
including, without limitation, costs and expenses of Lender’s legal counsel,
which amounts constitute part of the aggregate Obligations.

(e) Except as specifically provided in Section 6(b) and (c) below, Borrower’s
obligation to repay the Obligations is unconditional and without defense,
counterclaim, recoupment or offset. The Obligations are immediately due and
payable in full.

(f) (i) There exist one or more defaults under the terms of the Loan Documents,
(ii) any and all notices required to be given by Lender have in fact been given
and received, (iii) all applicable grace periods have expired without cure
having been effected, and (iv)Borrowing Parties hereby waive all such notice
provisions and grace periods in connection with the Existing Default.

(g) Borrower has no defenses, rights of set-off or recoupment, causes of action
or claims or counterclaims with respect to the Obligations and/or the liens and
security interests granted to Lender pursuant to the terms of the Loan
Documents, and all of such liens and security interests are enforceable by
Lender.

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(h) Borrowing Parties shall derive material benefit by virtue of the execution
and delivery of this Agreement and the performance of the parties’ obligations
hereunder.

3. Reaffirmation of Obligations. Borrowing Parties reaffirm and ratify that
Borrower is indebted and obligated, directly or indirectly, to Lender in an
amount equal to the Obligations set forth in Section 2(d) above. Interest shall
continue to accrue on and forms a part of the Obligations pursuant to the terms
of the Loan Documents as set forth herein. Borrower reaffirms and ratifies that,
pursuant to the terms of the Loan Documents, it is liable to pay or reimburse
applicable costs, fees and reasonable attorneys’ fees and expenses related to
the Obligations incurred by Lender, all of which form a part of the Obligations.
Borrower hereby promises to pay to the order of Lender the Obligations, plus any
and all accrued interest thereon and accrued costs, fees and reasonable
attorneys’ fees and expenses in accordance with the Loan Documents as modified
by the terms hereof.

4. Bankruptcy Proceedings. All representations and warranties set forth in
Section 4 of the Forbearance Agreement are true and correct on and as of the
date hereof and all acknowledgements, covenants and agreements set forth in
Section 4 of the Forbearance Agreement are each hereby ratified, remain in full
force and effect and constitutes the valid and legally binding obligations of
Borrower and/or Principals, as the case may be, enforceable in accordance
therewith.

5. Release; Lender’s Liability. (a) Borrower, Principals, their successors and
assigns (including, without limitation, any estate, debtor, trustee, receiver or
assignee for the benefit of creditors) to the fullest extent permitted by law
(collectively, the “Releasing Parties”), hereby release, remise, forever
discharge and forgive Lender, its shareholders, directors, affiliates, officers,
employees, servicers, agents, attorneys, representatives, predecessors,
successors and assigns (collectively, the “Released Parties”), of and from any
and all claims, causes, causes of action, demands, counterclaims, cross claims,
damages, complaints, suits, bonds, losses, liabilities, obligations,
commitments, contribution, indemnity or otherwise, at law or equity or mixed,
known, unknown, suspected, unsuspected, asserted, unasserted, which the
Releasing Parties or any of them, now have, had or may in the future have
against the Released Parties or any of them which arose prior to the execution
and delivery of this Agreement and relate to the Loan Documents and/or the
Obligations.

(b) Lender shall not be liable for any claims, suits, actions, costs, damages,
liabilities or expenses, or incidental, consequential, special or punitive
damages (“Liabilities”) in connection with the subject matter of this Amendment
other than Liabilities caused by the gross negligence or willful misconduct of
Lender, and Borrower hereby agrees to indemnify and hold harmless Lender and its
affiliates and the directors, officers, employees and agents of any of them, and
the successors and assigns of Lender from and against any and all Liabilities
arising from or in connection with any acts or omissions taken by Borrower in
connection with this Amendment or the performance of Borrower’s duties under
this Amendment, other than those Liabilities caused by the gross negligence or
willful misconduct of Lender.

6. Forbearance Period. (a) During the Second Extended Forbearance Period (as
defined below), Lender agrees to forbear from exercising any right or remedy
against Borrowing Parties with respect to the Existing Default, provided (i)
there shall occur no Event of Default other than the Existing Default, and (ii)
Borrower shall continue to make monthly Payments of accrued interest on the
Payment Date as contemplated by Section 2.2.1 of the Loan Agreement. Nothing
herein shall be construed as an agreement by Lender from asserting any
affirmative defense, cross-claim, counterclaim or third-party claim in any
action or proceeding that is now pending or may hereafter be commenced. Lender’s
agreement to forbear from exercising any rights or remedies in accordance with
this paragraph shall commence as of 5:00 PM Eastern time, July 11, 2007 and
continue until 5:00 PM Eastern time, October 11, 2007, unless earlier terminated
as a result of the occurrence of an Additional Default (as defined in the
Forbearance Agreement) (the “Second Extended Forbearance Period”). Upon and
after the expiration of the Second Extended Forbearance Period, Lender shall be
free to exercise any right or remedy to which Lender heretofore or hereafter
shall be entitled without regard to this paragraph. Nothing contained herein
shall be deemed to limit Borrower’s obligations to make all payments due under
the Loan Documents other than the repayment of the principal balance, all of
which obligations shall remain in full force and effect.

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(b) During the Second Extended Forbearance Period, so long as no Additional
Default shall occur, Borrower shall not be obligated to pay the Late Charges
accruing as contemplated by Section 8 of the Note. Provided that Borrower pays
the Obligations in full prior to the expiration of the Second Extended
Forbearance Period, Lender shall waive such Late Charges in their entirety.

(c) During the Second Extended Forbearance Period, so long as no Additional
Default shall occur, although shall accrue at the Default Rate as contemplated
by Section 7.2 of the Note, Borrower shall continue to pay interest at the
Interest Rate, and the difference between interest accruing at the Interest Rate
and the Default Rate (the “Interest Differential”) shall be deferred. Provided
that Borrower pays the Obligations in full prior to the expiration of the Second
Extended Forbearance Period, Lender shall waive the Interest Differential in its
entirety.

7. Costs and Expenses. Borrower shall be liable to and shall pay to Lender all
of the following:

(a) Interest. Upon execution and delivery hereof, Borrower shall pay all accrued
interest due under the Loan Documents to Lender including the installment due
July 11, 2007.

(b) Legal Fees. Borrower shall pay all of Lender’s reasonable attorneys’ fees
and expenses incurred in connection with the preparation and negotiation of this
Amendment and the enforcement of Lender’s rights and remedies hereunder or under
the Loan Documents, as the case may be.

(c) Lender’s Costs and Expenses. Borrower shall pay all costs and expenses
incurred by or on behalf of Lender relating the Loan, Borrower’s default, and
the execution and delivery of this Amendment.

(d) In addition to the foregoing, upon execution and delivery hereof, Borrower
shall pay to Lender a fee in the amount of Fifty Thousand and No/100 Dollars
($50,000.00) as consideration for Lender’s agreement to forbear from exercising
its rights and remedies with respect to the Existing Default as provided
hereunder.

8. Good Faith. Borrowing Parties acknowledge and warrant that Lender has acted
in good faith and has conducted itself in a commercially reasonable manner in
its relationships with Borrowing Parties in connection with this Amendment and
generally in connection with the Loan Agreement and the Obligations, Borrowing
Parties hereby waiving and releasing any claims to the contrary.

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9. Value. As a consequence of Lender’s covenants, releases, waivers, settlement,
and forbearance hereunder, Borrowing Parties have received reasonably equivalent
value, as construed under Section 548 of the Bankruptcy Code, and fair
consideration, as construed under applicable local and state laws, for their
obligations as set forth in this Amendment.

10. Representations and Warranties. Borrower and each Principal represents and
warrants to Lender for itself as follows:

(a) Borrower is a limited liability company duly formed, validly existing and in
good standing under the laws of the state in which it was formed.

(b) Borrower has the power and authority to execute and deliver this Amendment
and to perform its obligations hereunder, and has taken all necessary and
appropriate limited liability action to authorize the execution, delivery and
performance of this Amendment.

(c) The Forbearance Agreement, as amended by this Amendment, and each of the
other Loan Documents are each hereby ratified, each remain in full force and
effect, and each constitutes the valid and legally binding obligation of
Borrower and/or Principals, as the case may be, enforceable in accordance with
its terms.

(d) All of Borrower’s and Principals’ representations and warranties contained
in the Forbearance Agreement, Loan Agreement and the other Loan Documents are
true and correct on and as of the date of Borrower’s and Principals’ execution
of this Amendment.

(e) After giving effect to this Amendment, no Event of Default and no event
which, with notice, lapse of time or both would constitute an Event of Default,
has occurred and is continuing under the Forbearance Agreement, the Loan
Agreement or the other Loan Documents.

11. Remedies. Upon the occurrence of an Additional Default, Lender shall be
entitled immediately to terminate this Amendment and the Forbearance Agreement
without notice to the Borrowing Parties, whereupon Lender shall be entitled to
pursue all of its rights and remedies under the Loan Documents, at law or in
equity.

12. Notices. Any notice or other communication required or permitted to be given
shall be given in accordance with Section 14 of the Forbearance Agreement.

13. CONSENT TO JURISDICTION. BORROWER PARTIES HEREBY CONSENT TO THE JURISDICTION
OF ANY STATE OR FEDERAL COURT LOCATED WITHIN THE COUNTY OF NEW YORK, STATE OF
NEW YORK AND IRREVOCABLY AGREES THAT, SUBJECT TO LENDER’S ELECTION, ALL ACTIONS
OR PROCEEDINGS ARISING OUT OF OR RELATING TO THIS AMENDMENT OR THE FORBEARANCE
AGREEMENT OR THE LOAN DOCUMENTS SHALL BE LITIGATED IN SUCH COURTS. BORROWER
PARTIES EXPRESSLY SUBMIT AND CONSENT TO THE JURISDICTION OF THE AFORESAID COURTS
AND WAIVE ANY DEFENSE OF FORUM NON CONVENIENS. BORROWER PARTIES HEREBY WAIVE
PERSONAL SERVICE OF ANY AND ALL PROCESS AND AGREE THAT ALL SUCH SERVICE OF
PROCESS MAY BE MADE UPON BORROWER PARTIES BY CERTIFIED OR REGISTERED MAIL,
RETURN RECEIPT REQUESTED, ADDRESSED TO BORROWER PARTIES, AT THE ADDRESS SET
FORTH IN THE FORBEARANCE AGREEMENT AND SERVICE SO MADE SHALL BE COMPLETE TEN
(10) DAYS AFTER THE SAME HAS BEEN POSTED.

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14. WAIVER OF JURY TRIAL. BORROWING PARTIES WAIVE, TO THE FULLEST EXTENT
PERMITTED BY LAW, ANY RIGHT THEY MAY HAVE TO A TRIAL BY JURY OF ANY CLAIM,
COUNTERCLAIM, ACTION OR OTHER PROCEEDING ARISING UNDER OR RELATING TO THIS
AMENDMENT, THE FORBEARANCE AGREEMENT, THE LOAN DOCUMENTS, OR THE TRANSACTIONS
CONTEMPLATED HEREBY OR THEREBY.

15. Applicable Law. This Amendment shall be governed by and interpreted in
accordance with the laws of the State of New York applicable to contracts made
and performed in New York (without regard to principles of conflict of laws that
would defer to the substantive laws of another jurisdiction).

16. Severability. The invalidity, illegality or unenforceability or any
provision of this Amendment shall not affect or impair the validity, legality or
enforceability of the remainder of this Amendment, and to this end, the
provisions of this Amendment are declared to be severable.

17. Amendment is a Loan Document; Entire Agreement. This Amendment shall
constitute a Loan Document. This Amendment and the Loan Documents are complete,
integrated documents, set forth all of the terms, conditions and agreements
between the parties hereto and supersede any and all prior and contemporaneous
terms, conditions, and agreements between the parties hereto. There are no other
agreements, promises, representations or warranties made or given in connection
with any of the foregoing or concerning the subject matter hereof that are not
contained herein or in the Loan Documents.

18. Counterparts. This Amendment may be executed in any number of duplicate
originals or counterparts, each of such duplicate originals or counterparts
shall be deemed to be an original and taken together shall constitute but one
and the same instrument. The parties agree that their respective signatures may
be delivered by fax. Any party who chooses to deliver its signature by fax
agrees to provide a counterpart of this Amendment with its inked signature
promptly to each other party.

19. Survival. Any and all representations, warranties, covenants, promises and
understandings of any kind or nature whatsoever contained herein or in the Loan
Documents shall survive the execution and delivery hereof until the Obligations
are indefeasibly repaid in full to Lender.

20. Binding Effect. This Agreement shall be binding upon and inure to the
benefit of the parties hereto and their respective representatives, successors
and assigns.

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IN WITNESS WHEREOF, the parties hereto have executed this Amendment under seal
as of the date and year first written above.

WITNESS:
 
 
 
 
 
 
 
 
_________________________________
Name:
BORROWER:
 
SOUTH BEACH RESORTS, LLC,
a Florida limited liability company
 
By: SBR Holding Company, LLC,
a Florida limited liability company
 
By: American Leisure Holdings, Inc.
a Nevada corporation
 
By:_/s/ Malcolm Wright
Malcolm J. Wright
Chief Executive Officer
           
 
 
 
_________________________________
Name:
PRINCIPALS:
 
 
/s/ Fredric
Pauzar                                                                     
Fred Pauzar, individually
 
 
 
_________________________________
Name:
 
 
 
/s/ Malcolm
Wright                                                                  
Malcolm Wright, individually
           
 
 
 
 
 
 
_________________________________
Name:
LENDER:
 
LASALLE BANK, NATIONAL ASSOCIATION, as Trustee of Marathon Real Estate CDO
2006-1 Grantor Trust
 
 
By:    /s/ Jay
Miller                                                                      
Name: Jay Miller
Title: Assistant Vice President

 
 
 
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