Exhibit 10.26


 


PREPARED
BY:   Burns, Day
& Presnell, PA (JMD), P. O. Box 10867, Raleigh, NC 27605

RETURN TO:


 


NORTH CAROLINA


WAKE COUNTY


 


LOAN
ASSUMPTION/MODIFICATION AGREEMENT


(Master Line)


 


THIS LOAN ASSUMPTION/MODIFICATION AGREEMENT
(the “Agreement”) entered into this February 26, 2001, by PARKER & LANCASTER CORPORATION,
a Virginia corporation, (the “Borrower”), PARKER LANCASTER & ORLEANS, INC.,  a Delaware corporation, (the “New
Borrower”), ORLEANS HOMEBUILDERS, INC., a Delaware Corporation, (the
“Guarantor”), TROY A. GAMBRIL, as Trustee, (the “Trustee”), and SOUTHTRUST
BANK, a state banking corporation, (the “Lender”).


 


RECITALS


 


Pursuant to that loan commitment dated April
22, 1998 (the “Original Commitment”), Lender, on or about May 29, 1998, made a
$20,000,000.00 loan to Borrower (the “Loan”). Borrower executed a
$15,500,000.00  Promissory Note (the “NC
Note”) and a $4,500,000.00 Promissory Note (the “Virginia Note”), both in favor
of Lender  (collectively the “Note”) and
executed other documents, including the Deed of Trust (as described below)
which encumbers property located in various North Carolina and Virginia
counties, in connection with the Loan (the Note, these other documents, and the
Loan Modification Agreements described below collectively referred to as the
“Loan Documents”). Subsequently, the Borrower and Lender entered into various
Loan Modification Agreements modifying certain provisions of the Loan Documents
(together, the “Loan Modification Agreements”), which among other things, increased
the maximum amount of the Loan to $22,000,000.00. Borrower and New Borrower
have agreed to have New Borrower assume all of the Borrower’s obligations under
the Loan.  Lender has consented to that
assumption subject to the Borrower’s, the New Borrower’s, and the Guarantor’s
execution of this Agreement. As part of that assumption, the Lender has issued
and New Borrower has accepted a new loan commitment dated February 6, 2001 (the
“New Commitment”), which is incorporated into this Agreement by this reference,
which modifies certain terms of the Loan. The parties now wish to further
modify certain provisions of the Loan Documents in accordance with the terms of
the New Commitment. The parties, in consideration of their Recitals and in
exchange for the mutual promises contained in this Agreement, agree as follows:


 


1.             Assumption.


 


1.1.          New Borrower assumes any and all obligations
of Borrower expressed in the Loan Documents. Lender, by its signature below,
consents to this assumption. Borrower and Guarantor acknowledge that this
Agreement shall not in any way affect their respective obligations to Lender
under the Loan Documents and that they shall remain liable for any and all of
those obligations.  Lender is not releasing the
Borrower or Guarantor from any of its obligations under the Loan Documents.


 

















 


1.2.          Wherever written notice is required under the
Loan Documents to be sent to Borrower, this requirement shall be met by sending
such notice to the New Borrower to the address shown below:


 


New Borrower:


c/o Orleans
Homebuilders, Inc.


Attn: Chief
Financial Officer


3333 Street
Road


One Greenwood
Square, Suite 101


Bensalem,
Pennsylvania 19020


 


Borrower expressly waives any rights to
notice required under the Loan Documents. 
Notice to the New Borrower shall be deemed notice to the Borrower as
well.


 


2.             Modification.


 


2.1.          Notwithstanding language in the Note and the
other Loan Documents to the contrary, the parties agree that:


 


(a)           the maximum principal amount which may be
advanced or readvanced under the Note shall be $24,650,000.00;


 


(b)           the maximum amount which may be advanced or
readvanced under the NC Note shall be $19,650,000.00;


 


(c)           the maximum amount which may be advanced or
readvanced under the Virginia Note be $5,000,000.00;


 


(d)           Effective on and after the tenth of the
month following the date of this Agreement, the interest rate for the Loan
shall be at the rate per annum corresponding to the thirty (30) day LIBOR rate,
from time to time, plus 2.0%.  LIBOR
rate means the London Interbank Offered Rate for U.S. dollar deposits of thirty
(30) days maturity (rounded to the next higher 1/100 of 1%) as reported on
Telerate page 3750 as of 11:00 a.m., London time, (or if not so reported, then
as determined by Beneficiary from another recognized source of interbank
quotation). Changes in the interest rate will be effective on the tenth day of
the first month following each LIBOR rate change.


 


All Loan Documents, including, but not
limited to the Note and Deed of Trust, are amended accordingly.


 


2.2.          The terms of the New Commitment are
incorporated into the Loan Documents. In the event of a conflict between the
terms of the Original Commitment and the terms of the New Commitment, the
latter terms shall control.


 


3.             Effect of
Modification. Except as amended by this Agreement, the provisions of the Loan
Documents are hereby confirmed and shall remain in full force and effect. The
parties acknowledge that the Note, remains secured by all of those Deed of
Trust, Security Agreement and Assignment of Leases (Master Line) instruments
executed by Borrower as security for the


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Loan, including, but not limited to that
instrument recorded at Book 8080, Page 1025, Wake County Registry, as
supplemented by those Supplemental Deed(s) of Trust, if any, executed by
Borrower, (collectively the “Deed of Trust”). This Agreement shall not, in any
way, constitute a novation of the Loan.


 


4.             Representations.


 


4.1.          The Borrower, New Borrower and Guarantor, by
their signatures below, acknowledge that the Note and other Loan Documents, as
amended, represent valid and subsisting obligations of the Borrower, New
Borrower and Guarantor, respectively, and that there are no known defenses or
offsets against those obligations.


 


4.2.          The parties acknowledge that: (a) as of
January 31, 2001 the outstanding principal balance due under the Note is
$14,235,782.83; and (b) as of this date, to the best of their knowledge,
neither the Borrower nor the Guarantor is in default under any of the Loan
Documents, nor is there currently any event which, with the passage of time,
would constitute an Event of Default under any of the Loan Documents.


 


5.             Miscellaneous. 
As a material inducement to each party to enter into this Agreement, the
parties, severally, make the following representations and warranties, each of
which shall be true and correct as of the date of this Agreement: (i) It has
full power and legal right to execute, deliver and perform this Agreement; and
(ii) The execution and delivery of this Agreement and the consummation of the
contemplated transactions will not conflict with, violate or constitute a
default under any contract or other instrument to which it is a party or by
which it is bound. No modification of this Agreement shall be binding unless in
writing, attached hereto, and signed by the party against whom or which it is
sought to be enforced. This Agreement shall be binding upon and shall inure to
the benefit of the parties and their successors and permitted assigns. This
Agreement shall be construed in accordance with the laws of North Carolina
without giving effect to its conflict of laws principles. All words and phrases
in this Agreement shall be construed to include the singular or plural number,
and the masculine, feminine, or neuter gender, as the context requires. Each
party will execute and deliver all additional documents and do all such other
acts as may be reasonably necessary to carry out the provisions and intent of
this Agreement.


 


IN
WITNESS WHEREOF, the undersigned have executed,
sealed, and delivered this agreement as of the date first above written.


 


 


	
  BORROWER:

  	
  GUARANTOR:

  
	
   

  	
   

  
	
  PARKER & LANCASTER CORPORATION,

  	
  ORLEANS HOMEBUILDERS, INC.,

  
	
  a Virginia Corporation

  	
  a Delaware Corporation

  
	
   

  	
   

  
	
  BY:

  	
  Joseph A. Santangelo

  	
   

  	
  BY:

  	
  Joseph A. Santangelo

  	
   

  
	
  Name/Title:

  	
  Chief Financial Officer

  	
   

  	
  Name/Title:

  	
  Chief Financial Officer

  	
   

  



 


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  LENDER:

  	
  NEW BORROWER:

  
	
   

  	
   

  
	
  SOUTHTRUST
  BANK,

  	
  PARKER
  LANCASTER & ORLEANS, INC.,

  
	
  a state
  banking corporation (SEAL)

  	
  a Delaware
  Corporation

  
	
   

  	
   

  
	
  BY:

  	
  David P.
  Adams

  	
   

  	
  BY:

  	
  Joseph A.
  Santangelo

  	
   

  
	
  Name/Title:

  	
  Vice
  President

  	
   

  	
  Name/Title:

  	
  Chief
  Financial Officer

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  TRUSTEE:

  
	
   

  	
   

  
	
   

  	
  Troy A.
  Gambril

  	
  (SEAL)

  
	
   

  	
  Troy A.
  Gambril

  
							



 


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