Exhibit 10.1


 


LOAN
AGREEMENT


between


MAUI LAND & PINEAPPLE COMPANY, INC., a Hawaii
corporation

as Borrower


and


WELLS FARGO BANK, NATIONAL ASSOCIATION,

together with those assignees

becoming parties hereto pursuant

to Section 11.13, as Lenders


and


WELLS FARGO BANK, NATIONAL ASSOCIATION,

as Administrative Agent


Entered into as of November 13, 2007


 


 


WFB LOAN NO. 105088


 


 


 

















 


TABLE
OF CONTENTS


	
   

  	
   

  	
   

  	
   

  	
  Page

  
	
  ARTICLE 1.

  	
   

  	
  DEFINITIONS

  	
   

  	
  1

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1.1  

  	
   

  	
  DEFINED TERMS

  	
   

  	
  1

  
	
  1.2  

  	
   

  	
  SCHEDULES AND EXHIBITS INCORPORATED

  	
   

  	
  9

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 2.

  	
   

  	
  LOAN

  	
   

  	
  9

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  2.1  

  	
   

  	
  LOAN

  	
   

  	
  9

  
	
  2.2  

  	
   

  	
  LINE OF CREDIT

  	
   

  	
  9

  
	
  2.3  

  	
   

  	
  APPLICATION

  	
   

  	
  10

  
	
  2.4  

  	
   

  	
  LETTERS OF CREDIT

  	
   

  	
  10

  
	
  2.5  

  	
   

  	
  SWINGING LOANS

  	
   

  	
  13

  
	
  2.6  

  	
   

  	
  LOAN FEES

  	
   

  	
  15

  
	
  2.7  

  	
   

  	
  LOAN DOCUMENTS

  	
   

  	
  15

  
	
  2.8  

  	
   

  	
  EFFECTIVE DATE

  	
   

  	
  15

  
	
  2.9  

  	
   

  	
  MATURITY DATE

  	
   

  	
  15

  
	
  2.10

  	
   

  	
  INTEREST ON THE LOAN

  	
   

  	
  15

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (a)   Interest Payments

  	
   

  	
  15

  
	
   

  	
   

  	
  (b)   Default Interest

  	
   

  	
  15

  
	
   

  	
   

  	
  (c)   Late Fee

  	
   

  	
  15

  
	
   

  	
   

  	
  (d)   Computation of Interest

  	
   

  	
  16

  
	
   

  	
   

  	
  (e)   Effective Rate

  	
   

  	
  16

  
	
   

  	
   

  	
  (f)   Selection of Fixed Rate

  	
   

  	
  16

  
	
   

  	
   

  	
  (g)   Fixed Rate Taxes, Regulatory
  Costs and Reserve Percentages

  	
   

  	
  17

  
	
   

  	
   

  	
  (h)   Fixed Rate Price Adjustment

  	
   

  	
  17

  
	
   

  	
   

  	
  (i)    Purchase, Sale and Matching of
  Funds

  	
   

  	
  18

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  2.11

  	
   

  	
  PAYMENTS

  	
   

  	
  18

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (a)   Manner and Time of Payment

  	
   

  	
  18

  
	
   

  	
   

  	
  (b)   Payments on Non-Business Days

  	
   

  	
  18

  
	
   

  	
   

  	
  (c)   Direct Debit

  	
   

  	
  18

  
	
   

  	
   

  	
  (d)   Voluntary Prepayment

  	
   

  	
  18

  
	
   

  	
   

  	
  (e)   Reduction or Termination of
  Commitment

  	
   

  	
  19

  
	
  2.12

  	
   

  	
  FULL REPAYMENT AND RECONVEYANCE

  	
   

  	
  19

  
	
  2.13

  	
   

  	
  LENDERS’ ACCOUNTING

  	
   

  	
  19

  
	
  2.14

  	
   

  	
  OPTION TO EXTEND

  	
   

  	
  19

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  2.15

  	
   

  	
  PARTIAL RELEASE OF MAKAI SUBDIVISION

  	
   

  	
  21

  
	
  2.16

  	
   

  	
  RESERVED

  	
   

  	
  21

  
	
  2.17

  	
   

  	
  LIMITATION ON BORROWER’S LIABILITY

  	
   

  	
  21

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 3.

  	
   

  	
  DISBURSEMENT

  	
   

  	
  22

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  3.1  

  	
   

  	
  CONDITIONS PRECEDENT

  	
   

  	
  22

  
	
  3.2  

  	
   

  	
  ACCOUNT, PLEDGE AND ASSIGNMENT, AND DISBURSEMENT
  AUTHORIZATION

  	
   

  	
  23

  
	
  3.3  

  	
   

  	
  LOAN DISBURSEMENTS

  	
   

  	
  23

  
	
  3.4  

  	
   

  	
  FUNDS TRANSFER DISBURSEMENTS

  	
   

  	
  23

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 4.

  	
   

  	
  INSURANCE

  	
   

  	
  24

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  4.1  

  	
   

  	
  TITLE INSURANCE

  	
   

  	
  24

  
	
  4.2  

  	
   

  	
  PROPERTY INSURANCE

  	
   

  	
  24

  
	
  4.3  

  	
   

  	
  FLOOD HAZARD INSURANCE

  	
   

  	
  24

  
	
  4.4  

  	
   

  	
  LIABILITY INSURANCE

  	
   

  	
  25

  
	
  4.5  

  	
   

  	
  OTHER COVERAGE

  	
   

  	
  25

  



 


 


i

















 


	
  4.6  

  	
   

  	
  GENERAL

  	
   

  	
  25

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 5.

  	
   

  	
  REPRESENTATIONS AND WARRANTIES

  	
   

  	
  25

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  5.1  

  	
   

  	
  AUTHORITY/ENFORCEABILITY

  	
   

  	
  25

  
	
  5.2  

  	
   

  	
  BINDING OBLIGATIONS

  	
   

  	
  25

  
	
  5.3  

  	
   

  	
  FORMATION AND ORGANIZATIONAL DOCUMENTS

  	
   

  	
  25

  
	
  5.4  

  	
   

  	
  NO VIOLATION

  	
   

  	
  26

  
	
  5.5  

  	
   

  	
  COMPLIANCE WITH LAWS

  	
   

  	
  26

  
	
  5.6  

  	
   

  	
  LITIGATION

  	
   

  	
  26

  
	
  5.7  

  	
   

  	
  FINANCIAL CONDITION

  	
   

  	
  26

  
	
  5.8  

  	
   

  	
  NO MATERIAL ADVERSE CHANGE

  	
   

  	
  26

  
	
  5.9  

  	
   

  	
  ACCURACY

  	
   

  	
  26

  
	
  5.10

  	
   

  	
  TAX LIABILITY

  	
   

  	
  26

  
	
  5.11

  	
   

  	
  TITLE TO ASSETS; NO LIENS

  	
   

  	
  27

  
	
  5.12

  	
   

  	
  MANAGEMENT AGREEMENTS

  	
   

  	
  27

  
	
  5.13

  	
   

  	
  UTILITIES

  	
   

  	
  27

  
	
  5.14

  	
   

  	
  COMPLIANCE

  	
   

  	
  27

  
	
  5.15

  	
   

  	
  AMERICANS WITH DISABILITIES ACT COMPLIANCE

  	
   

  	
  27

  
	
  5.16

  	
   

  	
  BUSINESS LOAN

  	
   

  	
  27

  
	
  5.17

  	
   

  	
  TAX SHELTER REGULATIONS

  	
   

  	
  27

  
	
  5.18

  	
   

  	
  PROPERTY DOCUMENTS

  	
   

  	
  27

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 6.

  	
   

  	
  HAZARDOUS MATERIALS

  	
   

  	
  28

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  6.1  

  	
   

  	
  SPECIAL REPRESENTATIONS AND WARRANTIES

  	
   

  	
  28

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (a)   Hazardous Materials

  	
   

  	
  28

  
	
   

  	
   

  	
  (b)   Hazardous Materials Laws

  	
   

  	
  28

  
	
   

  	
   

  	
  (c)   Hazardous Materials Claims

  	
   

  	
  28

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  6.2  

  	
   

  	
  HAZARDOUS MATERIALS COVENANTS

  	
   

  	
  28

  
	
   

  	
   

  	
  (a)   No Hazardous Activities

  	
   

  	
  28

  
	
   

  	
   

  	
  (b)   Compliance

  	
   

  	
  28

  
	
   

  	
   

  	
  (c)   Notices

  	
   

  	
  28

  
	
   

  	
   

  	
  (d)   Remedial Action

  	
   

  	
  29

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  6.3  

  	
   

  	
  INSPECTION BY ADMINISTRATIVE AGENT

  	
   

  	
  29

  
	
  6.4  

  	
   

  	
  HAZARDOUS MATERIALS INDEMNITY

  	
   

  	
  29

  
	
  6.5  

  	
   

  	
  LEGAL EFFECT OF SECTION

  	
   

  	
  30

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 7.

  	
   

  	
  COVENANTS OF BORROWER

  	
   

  	
  30

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  7.1  

  	
   

  	
  EXPENSES

  	
   

  	
  30

  
	
  7.2  

  	
   

  	
  ERISA COMPLIANCE

  	
   

  	
  30

  
	
  7.3  

  	
   

  	
  LEASING

  	
   

  	
  30

  
	
  7.4  

  	
   

  	
  APPROVAL OF LEASES

  	
   

  	
  30

  
	
  7.5  

  	
   

  	
  SUBDIVISION MAPS

  	
   

  	
  31

  
	
  7.6  

  	
   

  	
  OPINION OF LEGAL COUNSEL

  	
   

  	
  31

  
	
  7.7  

  	
   

  	
  FURTHER ASSURANCES

  	
   

  	
  31

  
	
  7.8  

  	
   

  	
  ASSIGNMENT

  	
   

  	
  31

  
	
  7.9  

  	
   

  	
  MANAGEMENT OF PROPERTY

  	
   

  	
  31

  
	
  7.10

  	
   

  	
  REQUIREMENTS OF LAW

  	
   

  	
  31

  
	
  7.11

  	
   

  	
  LIENS AND STOP NOTICES

  	
   

  	
  31

  
	
  7.12

  	
   

  	
  FINANCIAL COVENANTS

  	
   

  	
  32

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (a)   Net Worth

  	
   

  	
  32

  
	
   

  	
   

  	
  (b)   Liquidity

  	
   

  	
  32

  
	
   

  	
   

  	
  (c)   Indebtedness

  	
   

  	
  32

  
	
   

  	
   

  	
  (d)   Interest Coverage Ratio

  	
   

  	
  32

  



 


 


ii

















 


	
  7.13

  	
   

  	
  SPECIAL COVENANTS

  	
   

  	
  32

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  7.14

  	
   

  	
  POST-CLOSING
  DELIVERIES

  	
   

  	
  32

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 8.

  	
   

  	
  REPORTING COVENANTS

  	
   

  	
  33

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  8.1  

  	
   

  	
  FINANCIAL INFORMATION

  	
   

  	
  33

  
	
  8.2  

  	
   

  	
  CERTIFICATES; OTHER INFORMATION

  	
   

  	
  33

  
	
  8.3  

  	
   

  	
  BOOKS AND RECORDS

  	
   

  	
  34

  
	
  8.4  

  	
   

  	
  REPORTS

  	
   

  	
  34

  
	
  8.5  

  	
   

  	
  LEASING REPORTS

  	
   

  	
  34

  
	
  8.6  

  	
   

  	
  KNOWLEDGE OF DEFAULT; ETC

  	
   

  	
  34

  
	
  8.7  

  	
   

  	
  LITIGATION, ARBITRATION OR GOVERNMENT INVESTIGATION

  	
   

  	
  34

  
	
  8.8  

  	
   

  	
  ENVIRONMENTAL NOTICES

  	
   

  	
  35

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 9.

  	
   

  	
  DEFAULTS AND REMEDIES

  	
   

  	
  35

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  9.1  

  	
   

  	
  DEFAULT

  	
   

  	
  35

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (a)   Monetary

  	
   

  	
  35

  
	
   

  	
   

  	
  (b)   Performance of Obligations

  	
   

  	
  35

  
	
   

  	
   

  	
  (c)   Use

  	
   

  	
  35

  
	
   

  	
   

  	
  (d)   Liens, Attachment; Condemnation

  	
   

  	
  35

  
	
   

  	
   

  	
  (e)   Representations and Warranties

  	
   

  	
  35

  
	
   

  	
   

  	
  (f)   Voluntary Bankruptcy;
  Insolvency; Dissolution

  	
   

  	
  35

  
	
   

  	
   

  	
  (g)   Involuntary Bankruptcy

  	
   

  	
  36

  
	
   

  	
   

  	
  (h)   Loss of Priority

  	
   

  	
  36

  
	
   

  	
   

  	
  (i)   Hazardous Materials

  	
   

  	
  36

  
	
   

  	
   

  	
  (j)   Other Obligors

  	
   

  	
  36

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  9.2  

  	
   

  	
  ACCELERATION UPON DEFAULT; REMEDIES

  	
   

  	
  36

  
	
  9.3  

  	
   

  	
  DISBURSEMENTS TO THIRD PARTIES

  	
   

  	
  36

  
	
  9.4  

  	
   

  	
  REPAYMENT OF FUNDS ADVANCED

  	
   

  	
  36

  
	
  9.5  

  	
   

  	
  RIGHTS CUMULATIVE, NO WAIVER

  	
   

  	
  36

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 10.

  	
   

  	
  THE ADMINISTRATIVE AGENT; INTERCREDITOR PROVISIONS

  	
   

  	
  37

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  10.1  

  	
   

  	
  APPOINTMENT AND AUTHORIZATION

  	
   

  	
  37

  
	
  10.2  

  	
   

  	
  WELLS FARGO AS LENDER

  	
   

  	
  38

  
	
  10.3  

  	
   

  	
  LOAN DISBURSEMENTS

  	
   

  	
  38

  
	
  10.4  

  	
   

  	
  DISTRIBUTION AND APPORTIONMENT OF PAYMENTS;
  DEFAULTING LENDERS

  	
   

  	
  39

  
	
  10.5  

  	
   

  	
  PRO RATA TREATMENT

  	
   

  	
  40

  
	
  10.6  

  	
   

  	
  SHARING OF PAYMENTS, ETC

  	
   

  	
  40

  
	
  10.7  

  	
   

  	
  COLLATERAL MATTERS; PROTECTIVE ADVANCES

  	
   

  	
  40

  
	
  10.8  

  	
   

  	
  POST-FORECLOSURE PLANS

  	
   

  	
  41

  
	
  10.9  

  	
   

  	
  APPROVALS OF LENDERS

  	
   

  	
  42

  
	
  10.10

  	
   

  	
  NOTICE OF DEFAULTS

  	
   

  	
  43

  
	
  10.11

  	
   

  	
  ADMINISTRATIVE AGENT’S RELIANCE, ETC

  	
   

  	
  43

  
	
  10.12

  	
   

  	
  INDEMNIFICATION OF ADMINISTRATIVE AGENT

  	
   

  	
  43

  
	
  10.13

  	
   

  	
  LENDER CREDIT DECISION, ETC

  	
   

  	
  44

  
	
  10.14

  	
   

  	
  SUCCESSOR ADMINISTRATIVE AGENT

  	
   

  	
  45

  
	
  10.15

  	
   

  	
  NO SET-OFFS

  	
   

  	
  45

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE 11.

  	
   

  	
  MISCELLANEOUS PROVISIONS

  	
   

  	
  45

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  11.1  

  	
   

  	
  INDEMNITY

  	
   

  	
  45

  
	
  11.2  

  	
   

  	
  FORM OF DOCUMENTS

  	
   

  	
  46

  
	
  11.3  

  	
   

  	
  NO THIRD PARTIES BENEFITED

  	
   

  	
  46

  
	
  11.4  

  	
   

  	
  NOTICES

  	
   

  	
  46

  
	
  11.5  

  	
   

  	
  ATTORNEY-IN-FACT

  	
   

  	
  46

  



 


 


 


iii

















 


	
  11.6  

  	
   

  	
  ACTIONS

  	
   

  	
  46

  
	
  11.7  

  	
   

  	
  RIGHT OF CONTEST

  	
   

  	
  47

  
	
  11.8  

  	
   

  	
  RELATIONSHIP OF PARTIES

  	
   

  	
  47

  
	
  11.9  

  	
   

  	
  DELAY OUTSIDE LENDER’S CONTROL

  	
   

  	
  47

  
	
  11.10

  	
   

  	
  ATTORNEYS’ FEES AND EXPENSES; ENFORCEMENT

  	
   

  	
  47

  
	
  11.11

  	
   

  	
  IMMEDIATELY AVAILABLE FUNDS

  	
   

  	
  47

  
	
  11.12

  	
   

  	
  AMENDMENTS AND WAIVERS

  	
   

  	
  47

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (a)   Generally

  	
   

  	
  47

  
	
   

  	
   

  	
  (b)   Unanimous Consent

  	
   

  	
  48

  
	
   

  	
   

  	
  (c)   Amendment of Administrative
  Agent’s Duties, Etc

  	
   

  	
  48

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  11.13

  	
   

  	
  SUCCESSORS AND ASSIGNS

  	
   

  	
  49

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (a)   Generally

  	
   

  	
  49

  
	
   

  	
   

  	
  (b)   Participations

  	
   

  	
  49

  
	
   

  	
   

  	
  (c)   Assignments

  	
   

  	
  49

  
	
   

  	
   

  	
  (d)   Tax Withholding

  	
   

  	
  49

  
	
   

  	
   

  	
  (e)   Federal Reserve Bank
  Assignments

  	
   

  	
  50

  
	
   

  	
   

  	
  (f)   Information to Assignee, Etc

  	
   

  	
  50

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  11.14

  	
   

  	
  CERTAIN ALLOWED DISCLOSURES

  	
   

  	
  50

  
	
  11.15

  	
   

  	
  CAPITAL ADEQUACY; ADDITIONAL COSTS

  	
   

  	
  50

  
	
  11.16

  	
   

  	
  LENDER’S AGENTS

  	
   

  	
  51

  
	
  11.17

  	
   

  	
  TAX SERVICE

  	
   

  	
  51

  
	
  11.18

  	
   

  	
  SEVERABILITY

  	
   

  	
  51

  
	
  11.19

  	
   

  	
  TIME

  	
   

  	
  51

  
	
  11.20

  	
   

  	
  HEADINGS

  	
   

  	
  52

  
	
  11.21

  	
   

  	
  GOVERNING LAW

  	
   

  	
  52

  
	
  11.22

  	
   

  	
  USA PATRIOT ACT NOTICE. COMPLIANCE

  	
   

  	
  52

  
	
  11.23

  	
   

  	
  ELECTRONIC DOCUMENT DELIVERIES

  	
   

  	
  52

  
	
  11.24

  	
   

  	
  INTEGRATION; INTERPRETATION

  	
   

  	
  52

  
	
  11.25

  	
   

  	
  JOINT AND SEVERAL LIABILITY

  	
   

  	
  53

  
	
  11.26

  	
   

  	
  COUNTERPARTS

  	
   

  	
  53

  
	
  11.27

  	
   

  	
  INTEREST RATE
  LIMITATION

  	
   

  	
  53

  
	
  11.28

  	
   

  	
  TREATMENT OF CERTAIN
  INFORMATION; CONFIDENTIALITY

  	
   

  	
  53

  



EXHIBITS AND SCHEDULES


 


SCHEDULE 1.1 — PRO RATA SHARES


SCHEDULE 5.6 —LITIGATION DISCLOSURE


SCHEDULE 6.1 — ENVIRONMENTAL REPORTS


 


 


EXHIBIT A — DESCRIPTION OF PROPERTY


EXHIBIT B — DOCUMENTS


EXHIBIT C — COMPLIANCE CERTIFICATE


EXHIBIT D — FORM OF ASSIGNMENT AND ASSUMPTION AGREEMENT


EXHIBIT E — FORM OF PROMISSORY NOTE


EXHIBIT F — FIXED RATE NOTICE


EXHIBIT G — TRANSFER AUTHORIZER DESIGNATION


EXHIBIT H — APPLICATION FOR ADVANCE


EXHIBIT I  —  FORM OF SWINGLINE NOTE


 


 


 


iv

















 


LOAN AGREEMENT


THIS LOAN AGREEMENT (“Agreement”) dated as of November
13, 2007 by and among MAUI LAND & PINEAPPLE COMPANY, INC., a corporation
formed under the laws of the State of Hawaii (“Borrower”), each of the
financial institutions initially a signatory hereto together with their
assignees under Section 11.13 (“Lenders”), and WELLS FARGO
BANK, NATIONAL ASSOCIATION (“Wells Fargo”) as contractual representative
of the Lenders to the extent and in the manner provided in Article 10
(in such capacity, the “Administrative Agent”).


R E C I T A L S


A.                                  Borrower and the Leasehold Mortgagor own
certain real property described in Exhibit A hereto and all improvements
now or hereafter existing thereon (collectively, the “Property”).


B.                                    Borrower desires to borrow from Lenders,
and Lenders agree to loan to Borrower, the amounts described below.


NOW, THEREFORE,
Borrower, Administrative Agent and Lenders agree as follows:


ARTICLE 1.  DEFINITIONS


1.1           DEFINED TERMS.


 


The following capitalized terms generally used in this
Agreement shall have the meanings defined or referenced below.  Certain other capitalized terms used only in
specific sections of this Agreement are defined in such sections.


“Account” - means an account with Bank of
Hawaii, ABA 121301028, Account Name: 
Maui Land and Pineapple Company, Inc., Account No.                         ,
into which Loan proceeds other than the initial Advance will be deposited.


“ADA” - means the Americans with Disabilities
Act, of July 26, 1990, Pub. L. No. 101-336, 104 Stat. 327, 42 U.S.C. §
12101, et. seq., as amended from time to time.


“Administrative Agent” - means Wells Fargo
Bank, National Association, or any successor Administrative Agent appointed
pursuant to Section 10.14.


“Advance” — shall have the meaning given such
term in Section 2.2.


“Affiliate” - means, with respect to any
Person, any other Person which is directly or indirectly controlled by,
controls or is under common control with such Person; provided, however,
in no event shall Administrative Agent or any Lender or any of their respective
Affiliates be an Affiliate of Borrower. 
For purposes of this definition, “control” (including with correlative
meanings, the terms “controlling”, “controlled by” and “under common control
with”) means the possession, directly or indirectly, of the power to direct or
cause the direction of the management and policies of a Person, whether through
the ownership of voting securities or by contract or otherwise.  The Affiliates of a Person shall include
without limitation, any Person that owns, directly or indirectly, 25% or more
of the equity interests having ordinary voting power for the election of
directors or other governing body of a Person, any officer or director of such
Person and any general Partner of Person.


“Agreement” - shall have the meaning given to
such term in the preamble hereto.


“Alternate Rate” - is a rate of interest per
annum four percent (4%) in excess of the applicable Effective Rate in effect
from time to time.


 


1

















 


 “Applicable
LIBO Rate” is the rate of interest, rounded upward to the nearest whole
multiple of one-hundredth of one percent (.01%), equal to the  sum
of: (a) one and one-half percent (1.50%) plus (b) the LIBO Rate,
which rate is divided by one (1.00) minus the Reserve Percentage:


	
  Applicable LIBO Rate =
  1.50%

  	
  +

  	
  LIBO
  Rate

  
	
   

  	
   

  	
  (1 - Reserve
  Percentage)

  



 


“Application for Advance” - means an
Application for Advance substantially in the form of Exhibit H
attached hereto executed by an authorized representative of the Borrower
identified in Section 2.10(f)(i).


“Appraisal” — means a written appraisal
prepared by an independent MAI appraiser acceptable to Administrative Agent and
subject to Administrative Agent’s customary independent appraisal requirements
and prepared in compliance with all applicable regulatory requirements,
including the Financial Institutions Recovery, Reform and Enforcement Act of
1989, as amended from time to time.


“Assignee” - shall have the meaning given in Section 11.13(c).


“Assignment and Assumption Agreement” - means
an Assignment and Assumption Agreement among a Lender, an Assignee and the
Administrative Agent, substantially in the form of Exhibit D.


“Bankruptcy Code” - means the Bankruptcy Reform
Act of 1978 (11 USC § 101-1330) as now or hereafter amended or recodified.


“Borrower” - shall have the meaning given in
the preamble hereto.


“Business Day” - means a day of the week (but
not a Saturday, Sunday or holiday) on which the offices of Administrative Agent
in San Francisco, California are open to the public for carrying on
substantially all of Administrative Agent’s business functions.  Unless specifically referenced in this
Agreement as a Business Day, all references to “days” shall be to calendar
days.


 “Collateral”
— means the Property and any personal property or other collateral with respect
to which a Lien or security interest was granted to Administrative Agent, for
the benefit of Lenders, pursuant to the Loan Documents.


“Collateral Assignment of Water Delivery Agreement”
- means that certain Collateral Assignment of Agreement for Water Delivery
dated as of November 13, 2007, among the Administrative Agent, Leasehold
Mortgagor and Maui Pineapple Company, Ltd., a Hawaii corporation,. as joined by
Borrower.


 “Commercial
Property” — means the real property described as Parcels 2 through 11,
inclusive, on Exhibit A.


“Commitment” - means, as to each Lender, such
Lender’s obligation to make disbursements pursuant to Section 3.3
and Section 10.3, to participate in Letters of Credit pursuant to Section
2.4, and to participate in Swingline Loans pursuant to Section 2.5,
in an amount up to, but not exceeding the amount set forth for such Lender on Schedule 1.1
attached hereto as such Lender’s “Commitment Amount” or as set forth in the
applicable Assignment and Assumption Agreement, as the same may be reduced from
time to time pursuant to the terms of this Agreement or as appropriate to
reflect any assignments to or by such Lender effected in accordance with Section 11.13.


“Compliance Certificate” means a certificate
substantially in the form of Exhibit C.


“Credit Limit” - means Ninety Million And
No/100ths Dollars ($90,000,000.00), as such amount may hereafter be decreased
pursuant to the terms of this Agreement. 
The amount of the Interest Holdback shall at all times be deemed to be
utilized as a portion of the Credit Limit.


“Default” - shall have the meaning given to
such term in Section 9.1.


 


2

















 


“Defaulting Lender” — means any Lender which
fails or refuses to perform its obligations under this Agreement within the
time period specified for performance of such obligation or, if no time frame
is specified, if such failure or refusal continues for a period of five (5)
Business Days after notice from Administrative Agent.


“Dollars” and “$” — means the lawful
money of the United States of America.


“Effective Date” - means the date the Mortgage
is recorded in Bureau of Conveyances of the State of Hawaii and/or the Office
of the Assistant Registrar of the Land Court of the State of Hawaii, as
applicable.


“Effective Rate” - shall have the meaning given
in Section 2.10(e).


“Extending Lender” - shall have the meaning
given in Section 2.14(b).


“Extension Date” - shall have the meaning given
in Section 2.14.


“Eligible Assignee” - means any Person that
is:  (a) an existing Lender; (b) a
commercial bank, trust company, savings and loan association, savings bank,
insurance company, investment bank or pension fund organized under the laws of
the United States of America, any state thereof or the District of Columbia,
and having total assets in excess of $5,000,000,000; or (c) a commercial bank
organized under the laws of any other country which is a member of the
Organization for Economic Co-operation and Development, or a political
subdivision of any such country, and having total assets in excess of
$10,000,000,000, provided that such bank is acting through a branch or agency
located in the United States of America. 
If such entity is not currently a Lender, such entity’s (or in the case
of a bank which is a subsidiary, such bank’s parent’s) senior unsecured long
term indebtedness must be rated BBB or higher by S&P, Baa2 or higher by
Moody’s Investor Service or the equivalent or higher of either such rating by
another rating agency acceptable to the Administrative Agent.


“ERISA” - means the Employee Retirement Income
Security Act of 1974, as in effect from time to time.


“Federal Funds Rate” — means, for any period, a
fluctuating interest rate per annum equal for each day during such period to
the weighted average of the rates on overnight Federal Funds transactions with
members of the Federal Reserve System arranged by Federal Funds brokers, as
published for such day (or, if such day is not a Business Day, for the next
preceding Business Day) by the Federal Reserve Bank of New York, or, if such
rate is not so published for any day which is a Business Day, the average of
the quotations for such day on such transactions received by Administrative Agent
from three Federal Funds brokers of recognized standing selected by
Administrative Agent.


“Fixed Rate” is the Applicable LIBO Rate as
accepted by Borrower as an Effective Rate for a particular Fixed Rate Period
and Fixed Rate Portion.


“Fixed Rate Commencement Date” - means the date
upon which the Fixed Rate Period commences.


“Fixed Rate Notice” is a written notice in the
form shown on Exhibit F hereto which requests a Fixed Rate for a
particular Fixed Rate Period and Fixed Rate Portion.


“Fixed Rate Period” is the period or periods
of  (a) one, two, three or six months; or
(b) any other period which ends at the Maturity Date, which periods are
selected by Borrower and confirmed in a Fixed Rate Notice; provided that no Fixed
Rate Period shall extend beyond the Maturity Date.


“Fixed Rate Portion” is the portion or portions
of the principal balance of the Loan which Borrower selects to have subject to
a Fixed Rate, each of which is an amount: (a) not more than the unpaid
principal balance of the Loan not subject to a Fixed Rate; and (b) is not less
than THREE MILLION DOLLARS ($3,000,000.00) and is an even multiple of FIVE
HUNDRED THOUSAND DOLLARS ($500,000.00). 
In the event Borrower is subject to a principal amortization schedule
under the terms and 


 


3

















 


conditions of the Loan Documents, the Fixed Rate
Portion(s) from time to time in effect shall in no event exceed, in the
aggregate, the maximum outstanding principal balance which will be permissible
on the last day of the Fixed Rate Period selected.


“Fixed Rate Price Adjustment”  — shall have the meaning set forth in Section 2.10(h).


“Fixed Rate Taxes”  — are, collectively, all withholdings,
interest equalization taxes, stamp taxes or other taxes (except income and franchise
taxes) imposed by any domestic or foreign governmental authority and related in
any manner to a Fixed Rate.


“Funding Date” — shall mean the date on or
after which all conditions precedent thereto have been satisfied on which any
Advance is to be funded.


“GAAP” means generally accepted accounting
principles in the United States set forth in the opinions and pronouncements of
the Accounting Principles Board and the American Institute of Certified Public
Accountants and statements and pronouncements of the Financial Accounting
Standards Board or such other principles as may be approved by a significant
segment of the accounting profession in the United States, that are applicable
to the circumstances as of the date of determination, consistently applied.


“Governmental Authority” - means any nation or
government, any federal, state, local, municipal or other political subdivision
thereof or any entity exercising executive, legislative, judicial, regulatory
or administrative functions of or pertaining to government.


“Hazardous Materials” - shall have the meaning
given to such term in Section 6.1(a).


“Hazardous Materials Claims” - shall have the
meaning given to such term in Section 6.1(c).


“Hazardous Materials Laws” - shall have the
meaning given to such term in Section 6.1(b).


“Indebtedness” - shall mean all obligations for
borrowed money, notes payable, bonds and debentures (excluding public
improvement bonds), purchase-money indebtedness, capitalized leases, supporting
payment obligations for letters of credit, guaranties and other similar
contingent liabilities relating to the obligations of other Persons which would
otherwise constitute “Indebtedness” under this definition, net obligations
under hedge agreements (including interest rate hedge agreements), repurchase
obligations, liabilities with respect to account or notes receivables which
have been sold or assets which have been leased, and obligations under
synthetic or tax retention leases. 
Indebtedness shall not include any guaranties or contingent liabilities
arising from the Borrower’s direct or indirect joint venture interest in
Kapalua Bay Holdings, LLC or Ritz-Carlton Kapalua Joint Venture.


“Initial Mauka Appraisal” - means that certain
Appraisal of the Kapalua Mauka Development Lands and Golf Course prepared by
Lesher Chee Stadlbauer and dated October 26, 2007.


 “Interest
Holdback” - means a portion of the Credit Limit equal, initially, to $0,
which amount may be reduced or increased on each anniversary of the Effective
Date as the Administrative Agent deems in its reasonable discretion is
necessary to pay the projected Unfunded Interest through the then-current
Maturity Date as determined in good faith by the Administrative Agent.


“Kapalua Mauka” — means the real property
described as Parcels 1, 1a and 1b on Exhibit A.


“Leasehold Mortgagor” means Kapalua Land
Company, Ltd., a Hawaii corporation.


“Lender” - means each financial institution
from time to time party hereto as a “Lender” and, as the context requires, the “Swingline
Lender,” together with its respective successors and permitted assigns.  With respect to matters requiring the consent
or approval of all Lenders at any given time, all then existing Defaulting
Lenders will be disregarded and excluded, and, for voting purposes only, “all Lenders”
shall be deemed to mean “all Lenders other than Defaulting Lenders”.


 


4




















“Letter of Credit Documents” means, with
respect to any Letter of Credit, collectively, any application therefor, any
certificate or other document presented in connection with a drawing under such
Letter of Credit and any other agreement, instrument or other document
governing or providing for (a) the rights and obligations of the parties
concerned or at risk with respect to such Letter of Credit or (b) any
collateral security for any of such obligations.


“Letter of Credit Liabilities” means, without
duplication, at any time and in respect of any Letter of Credit, the sum of (a)
the Stated Amount of such Letter of Credit plus (b) the aggregate unpaid
principal amount of all Reimbursement Obligations of the Borrower at such time
due and payable in respect of all drawings made under such Letter of
Credit.  For purposes of this Agreement,
a Lender (other than the Lender then acting as Agent) shall be deemed to hold a
Letter of Credit Liability in an amount equal to its participation interest
under Section 2.4 in the related Letter of Credit, and the Lender then acting
as Agent shall be deemed to hold a Letter of Credit Liability in an amount
equal to its retained interest in the related Letter of Credit after giving
effect to the acquisition by the Lenders (other than the Lender then acting as
Agent) of their participation interests under such Section.


“L/C
Commitment Amount” has the meaning given to that term in Section
2.4.


“LIBO Rate” - is the rate of interest, rounded
upward to the nearest whole multiple of one-sixteenth of one percent (.0625%),
quoted by Administrative Agent from time to time as the London Inter-Bank
Offered Rate for deposits in U.S. Dollars at approximately 9:00 a.m. California
time, two (2) Business Days prior to a Fixed Rate Commencement Date or a Price
Adjustment Date, as appropriate, for purposes of calculating effective rates of
interest for loans or obligations making reference thereto for an amount
approximately equal to a Fixed Rate Portion and for a period of time
approximately equal to a Fixed Rate Period or the time remaining in a Fixed
Rate Period after a Price Adjustment Date, as appropriate.


“Lien” — means any mortgage, deed of trust,
pledge, hypothecation, assignment, deposit arrangement, security interest,
encumbrance (including, but not limited to, easements, rights-of-way, zoning
restrictions and the like), lien (statutory or other), preference, priority or
other security agreement or preferential arrangement of any kind or nature
whatsoever, including without limitation any conditional sale or other title
retention agreement, the interest of a lessor under a capital lease, any
financing lease having substantially the same economic effect as any of the
foregoing, and the filing of any financing statement or document having similar
effect that perfects a security interest (other than a financing statement
filed by a “true” lessor pursuant to Section 9408 (or a successor section) of
the Uniform Commercial Code) naming the owner of the asset to which such Lien
relates as debtor, under the Uniform Commercial Code or other comparable law of
any jurisdiction.


“Loan” - means the maximum principal sum that
Lenders agree to lend and Borrower agrees to borrow pursuant to the terms and
conditions of this Agreement:  NINETY
MILLION AND NO/100THS DOLLARS ($90,000,000.00).


“Loan Documents” - means those documents, as
hereafter amended, supplemented, replaced or modified, properly executed and in
recordable form, if necessary, listed in Exhibit B as Loan
Documents.


“Loan Party” — means Borrower, Leasehold
Mortgagor, and any other person or entity obligated under the Loan Documents or
Other Related Documents.


“Loan-to-Value Percentage” — shall have the
meaning given such term in Section 2.14 of this Agreement.


“Material Adverse Effect” means a material
adverse change in, or a material adverse effect upon, any of (a) the assets,
operations, business, condition (financial or otherwise), or prospects of the
Borrower and its Subsidiaries, taken as a whole, or (b) the ability of the
Borrower to perform under any Loan Document or avoid any Default.


“Maturity Date” — means November 13, 2009.


5

















“Mortgage” - means the Mortgage with Absolute
Assignment of Leases and Rents, Security Agreement and Fixture Filing of even
date herewith executed by Borrower and Leasehold Mortgagor, collectively as
Mortgagor and Administrative Agent, for the benefit of Lenders, as Mortgagee,
as hereafter amended, supplemented, replaced or modified.


“Non-Pro Rata Advance” — shall mean a
Protective Advance or a disbursement under the Loan with respect to which fewer
than all Lenders have funded their respective Pro Rata Shares in breach of
their obligations under this Agreement.


“Non Extending Lender” - shall have the meaning
given such term in Section 2.14(a).


“Note” or “Notes” — means a Revolving
Note or a Swingline Note.


“Obligations” means all the Loan and all
Advances, debts, liabilities, obligations, covenants and duties owed by the
Borrower to the Lender or any other Person required to be paid, performed or
indemnified under any Loan Document, of any kind or nature, present or future,
whether or not evidenced by any note or other instrument, arising under this
Agreement or under any other Loan Document, whether or not for the payment of
money, whether arising by reason of an extension of credit, loan,
indemnification or in any other manner, whether direct or indirect (including
those acquired by assignment), absolute or contingent, due or to become due,
now existing or hereafter arising and however acquired.


“Other Related Documents” - means those
documents, as hereafter amended, supplemented, replaced or modified from time
to time, properly executed and in recordable form, if necessary, listed in Exhibit B
as Other Related Documents.


“Participant” - shall have the meaning given to
such term in Section 11.13.


“Permit” — means any permit, approval,
authorization, license, variance or permission required from a Governmental
Authority under an applicable Requirement of Law.


“Permitted Lease” — shall have the meaning
given to such term in Section 7.4.


“Permitted Liens” — means:


(a)                               Liens (other than environmental Liens and
any Lien imposed under ERISA) for taxes, assessments or charges of any
Governmental Authority for claims not yet due or which do not have priority
over the Administrative Agent’s Liens and with respect to which the underlying
taxes, assessments, or charges are the subject of a good faith dispute and a
reserve is established on the books and records of the Borrower in accordance
with GAAP;


(b)                              any laws, ordinances or regulations
affecting the Property;


(c)                               Liens imposed by laws, arising in the
ordinary course of business which secure payment of obligations not more than
thirty (30) days past due;


(d)           the interests of lessors under
personal property operating leases and purchase money Liens or the interests of
lessors under personal property capital leases so long as such Lien attaches
only to the asset purchased or acquired and the proceeds thereof;


(e)           Liens on amounts deposited in
connection with obtaining worker’s compensation or other unemployment insurance;


(f)            Liens on amounts
deposited in connection with the making or entering into of bids, tenders,
statutory obligations, government contracts, or leases in the ordinary course
of business and not in connection with the borrowing of money;


 


6

















(g)           Liens on amounts
deposited as security for surety or appeal bonds in connection with obtaining
such bonds in the ordinary course of business;


(h)           with respect to any real property,
easements, rights of way, and zoning restrictions that do not materially
interfere with or impair the value, use or operation thereof;


(i)                                  All matters shown on the Title Policy as
exceptions to Lender’s coverage thereunder; and


(j)                                  Liens in favor of Administrative Agent,
for the benefit of Lenders, under the Mortgage.


“Person” - means any natural person,
corporation, limited partnership, general partnership, joint stock company,
limited liability company, limited liability partnership, joint venture,
association, company, trust, bank, trust company, land trust, business trust or
other organization, whether or not a legal entity, or any other nongovernmental
entity, or any Governmental Authority.


“Potential Default” — means an event,
circumstance or condition which, with the giving of notice or the lapse of
time, or both, would constitute a Default.


“Price Adjustment Date”  — shall have the meaning set forth in Section 2.10(h).


“Prime Rate” - means a base rate of interest
which Administrative Agent establishes from time to time and which serves as
the basis upon which the effective rates of interest are calculated for those
loans making reference thereto.  Any
change in an effective rate due to a change in the Prime Rate shall become
effective on the day each such change is announced by Administrative Agent at
its principal office in San Francisco, California.


“Property” - shall have the meaning given to
such term in Recital A.


“Pro Rata Share”-  means, as to each Lender, the ratio,
expressed as a percentage, of (a) the amount of such Lender’s Commitment to (b)
the aggregate amount of the Commitments of all Lenders hereunder; provided,
however, that if at the time of determination the Commitments have
terminated or been reduced to zero, the “Pro Rata Share” of each Lender shall
be the Pro Rata Share of such Lender in effect immediately prior to such
termination or reduction.


“Protective Advance” - shall mean any advances
made by Administrative Agent in accordance with the provisions of Section 10.7(e)
to protect the Collateral securing the Loan.


“Recourse Amount” shall mean (i) the principal
amount of the Advances outstanding at any time in excess of $60,000,000.00,
together with all accrued but unpaid interest thereon plus (ii) all
other amounts payable to Administrative Agent and Lenders under the Loan
Documents not on account of principal or interest (whether under
Section 7.1, Section 11.10 or otherwise).


“Real Estate Advances” - means Advances made to
finance the acquisition of real property.


“Real Estate Credit Limit” - means
$20,000,000.00, as such amount may be increased from time to time by the Agent
in its sole and absolute discretion.


“Regulatory Costs” - are, collectively, future,
supplemental, emergency or other changes in Reserve Percentages, assessment
rates imposed by the Federal Deposit Insurance Corporation, or similar
requirements or costs imposed by any domestic or foreign governmental authority
and related in any manner to a Fixed Rate.


“Reimbursement Obligation”  — shall have the meaning given such term in Section 2.4(d).


“Request to Extend” shall have the meaning
given such term in Section 2.14.


“Requirements of Law” — mean, as to any entity,
the charter and by-laws, partnership agreement or other organizational or
governing documents of such entity, and any law, rule or regulation, Permit, or



 


7

















determination of an arbitrator or a court or other
Governmental Authority, in each case applicable to or binding upon such entity
or any of its property or to which such entity or any of its property is
subject, including without limitation, applicable securities laws and any
certificate of occupancy, zoning ordinance, building, environmental or land use
requirement or Permit or occupational safety or health law, rule or regulation.


“Requisite Lenders” - means, as of any date,
Lenders (which must include the Lender then acting as Administrative Agent)
having at least 66-2/3% of the aggregate amount of the Commitments, or, if the
Commitments have been terminated or reduced to zero, Lenders holding at least
66-2/3% of the principal amount outstanding under the Loan and the Letter of
Credit Liabilities, provided that (a) in determining such percentage at any given
time, all then existing Defaulting Lenders will be disregarded and excluded and
the Pro Rata Shares of the Loan of Lenders shall be redetermined, for voting
purposes only, to exclude the Pro Rata Shares of the Loan of such Defaulting
Lenders, and (b) at all times when two or more Lenders are party to this
Agreement, the term “Requisite Lenders” shall in no event mean less than two
Lenders.


“Reserve Percentage” - is at any time the
percentage, if any, announced by Administrative Agent as the reserve percentage
under Regulation D for loans and obligations making reference to an Applicable
LIBO Rate for a Fixed Rate Period or time remaining in a Fixed Rate Period on a
Price Adjustment Date, as appropriate. 
The Reserve Percentage shall be based on Regulation D or other
regulations from time to time in effect concerning reserves for Eurocurrency
Liabilities as defined in Regulation D from related institutions as though
Administrative Agent were in a net borrowing position, as promulgated by the
Board of Governors of the Federal Reserve System, or its successor.


“Subdivision Map” - shall have the meaning
given to such term in Section 7.5.


“Revolving Note” - means each Promissory Note
Secured by Mortgage substantially in the form of Exhibit E attached hereto, collectively
in the original principal amount of the Loan, executed by Borrower and payable
to the order of a Lender, together with such other replacement notes as may be
issued from time to time pursuant to Section 11.13, as hereafter
amended, supplemented, replaced or modified.


“Subsidiary” - of a Person means a corporation,
partnership, joint venture, limited liability company or other business entity
of which a majority of the shares of securities or other interests having
ordinary voting power for the election of directors or other governing body
(other than securities or interests having such power only by reason of the
happening of a contingency) are at the time beneficially owned, or the
management of which is otherwise controlled, directly, or indirectly through
one or more intermediaries, or both, by such Person.  Unless otherwise specified, all references
herein to a “Subsidiary” or to “Subsidiaries” shall refer to a Subsidiary or
Subsidiaries of the Borrower.  Kapalua
Bay Holdings, LLC and the Ritz-Carlton Kapalua Joint Venture shall not be
deemed Subsidiaries of the Borrower.


“Stated Amount” means the amount available to
be drawn by a beneficiary under a Letter of Credit from time to time, as such
amount may be increased or reduced from time to time in accordance with the
terms of such Letter of Credit; provided, however, that with respect to any
Letter of Credit that, by its terms or the terms of any Letter of Credit
Document related thereto, provides for one or more automatic increases in the
stated amount thereof, the amount of such Letter of Credit shall be deemed to
be the maximum stated amount of such Letter of Credit after giving effect to
all such increases, whether or not such maximum stated amount is in effect at
such time.


 “Swingline
Commitment” means the Swingline Lender’s obligation to make Swingline Loans
pursuant to Section 2.5 in an amount up to, but not exceeding the amount
set forth in Section 2.5, as such amount may be reduced from time to
time in accordance with the terms hereof.


“Swingline Lender” means Wells Fargo Bank,
National Association, together with its respective successors and assigns.


 


8

















“Swingline Loan” means a loan made by the
Swingline Lender to the Borrower pursuant to Section 2.5.


“Swingline Note” means a promissory note of the
Borrower substantially in the form of Exhibit I, payable to the
order of the Swingline Lender in a principal amount equal to the amount of the
Swingline Commitment as originally in effect and otherwise duly completed.


“Swingline Termination Date” means the date
which is seven (7) Business Days prior to the Maturity Date.


“Then Scheduled Maturity Date” - shall have the
meaning given in Section 2.14.


“Title Policy” - means the ALTA Lender’s Policy
of Title Insurance as issued by First American Title Insurance Company,
including all endorsements thereto as required by Administrative Agent.


“Unfunded Interest” - shall mean, for any
period, the amount by which interest payable on the Loan exceeds or is projected
to exceed net income from the Commercial Property.


“Variable Rate” - on any day means a floating
rate of interest per annum equal to the  higher  of (a) the
Prime Rate then in effect or (b) the Federal Funds Rate then in effect
as announced by the Federal Reserve Bank of New York plus one-half percent
(0.5%).


“Water Delivery Agreement” shall mean that
certain Agreement for Water Delivery dated June 21, 2006, but effective as of
January 1, 2006, between Maui Pineapple Company, Ltd., a Hawaii corporation,
and Leasehold Mortgagor, as amended by that certain Amendment For Water
Delivery dated November 7, 2007.


“Wells Fargo” - shall have the meaning given to
such term in the preamble hereto.


1.2           SCHEDULES AND EXHIBITS INCORPORATED.


 


Schedules 1.1, 5.6 and 6.1, and Exhibits A,
B, C, D, E, F, G,  H and I, all attached hereto,
are hereby incorporated into this Agreement.


ARTICLE 2.  LOAN


2.1           LOAN.


 


By and subject to the terms of this Agreement, Lenders
agree to lend to Borrower, and Borrower agrees to borrow from Lenders, the
principal sum of up to NINETY MILLION AND NO/100THS DOLLARS ($90,000,000.00),
said sum to be evidenced by the Notes. 
The Notes shall be secured, in part, by the Mortgage encumbering certain
real property and improvements as legally defined therein.  Amounts disbursed to or on behalf of Borrower
pursuant to the Notes shall be used for (i) repayment of indebtedness secured
by the Property, (ii) short term capital requirements of the Borrower and its
Affiliates related to real estate activities including pre-development costs,
development costs and capital improvements, (iii) working capital and general
corporate purposes of Borrower and its Affiliates and (iv) subject to the
limitations contained in this Agreement, to finance the acquisition of real
property.


2.2           LINE OF CREDIT.


 


The Loan will be disbursed in a series of advances
(each, an “Advance”) to Borrower, from time to time up to but not including the
Maturity Date.  The initial Advance shall
be in an amount equal to SEVENTEEN MILLION AND NO/100THS DOLLARS, from which
$450,771.47 will be retained by Administrative Agent in payment of certain fees
payable to Adminstrative Agent and Lenders, and the remainder of which shall be
disbursed to or for the benefit or account of Borrower to Escrow No.
A72044205  held at Title Guaranty of
Hawaii, Inc. in accordance with the instructions provided on a Transfer
Authorizer Designation Form in the form of Exhibit G executed and delivered to
Administrative 


 


9

















Agent.  The
amount of each subsequent Advance shall be at least TWO HUNDRED THOUSAND AND
NO/100THS DOLLARS ($200,000.00) and additional multiples of ONE HUNDRED
THOUSAND AND NO/100THS DOLLARS ($100,000.00). 
The aggregate total of all Advances (including Swingline Loans) plus
the aggregate Letter of Credit Liabilities outstanding at any time plus
the amount of the Interest Holdback as adjusted from time to time by
Administrative Agent shall never exceed the Credit Limit, the aggregate total
of all Real Estate Advances at any time shall never exceed the Real Estate
Credit Limit, and all borrowings shall otherwise be subject to all the
limitations, terms and conditions contained in the Loan Documents.  If at any time the aggregate amounts of all
Advances (including Swingline Loans) plus the aggregate Letter of Credit
Liabilities plus the Interest Holdback as adjusted from time to time by
the Administrative Agent exceeds the Credit Limit, the Borrower shall
immediately repay the Loan in an amount sufficient to reduce such aggregate
amounts to the Credit Limit.  Except as
otherwise provided in any Loan Document, Borrower may, from time to time
through the Maturity Date, borrow, partially or wholly repay its outstanding borrowings,
and reborrow under the Loan.


2.3           APPLICATION.


 


Borrower shall make application for each Advance by
completing, executing and delivering to Administrative Agent, not less than
three (3) days (for Fixed Rate Portions) nor less than one (1) Business Day
(for Advances at the Variable Rate) prior to the date upon which Borrower
wishes Administrative Agent to disburse the Advance, an Application For Advance
and such other information and documents regarding the Advance or the purpose
for the Advance as Administrative Agent may reasonably request.  With respect to a Real Estate Advance,
Borrower shall deliver to Administrative Agent not less than three (3) Business
Days prior to the proposed date of the Real Estate Advance, information and
documents identified in the Application for Advance and relating to the real
property to be purchased with the proceeds of such Real Estate Advance.


                2.4           LETTERS OF CREDIT.


 


(a)           Subject to the terms and conditions
of this Agreement, the Administrative Agent, on behalf of the Lenders, agrees
to issue for the account of the Borrower during the period from and including
the Effective Date to, but excluding, the date thirty (30) days prior to the
Maturity Date, one or more standby letters of credit (each a “Letter of Credit”)
up to a maximum aggregate Stated Amount at any one time outstanding not to
exceed $5,000,000.00 as such amount may be reduced from time to time in
accordance with the terms hereof (the “L/C Commitment Amount”).


(b)           At the time of issuance, the amount,
form, terms and conditions of each Letter of Credit, and of any drafts or
acceptances thereunder, shall be subject to reasonable approval by the
Administrative Agent and the Borrower. 
Notwithstanding the foregoing, in no event may (i) the expiration date
of any Letter of Credit extend beyond the Maturity Date, (ii) any Letter of
Credit have an initial duration in excess of one year, or (iii) any Letter of
Credit contain an automatic renewal provision. 
The initial Stated Amount of each Letter of Credit shall be at least
$100,000.00.  In the event the Maturity
Date shall be accelerated prior to the expiration of a Letter of Credit, all
outstanding Letters of Credit shall be deemed to be immediately due and
payable; Borrower shall immediately deposit with Administrative Agent cash or
acceptable cash equivalents equal to the undrawn balance of any such
outstanding Letter of Credit, with said deposit to be collateral security
(pursuant to a security agreement acceptable in form to Administrative Agent)
for all obligations of Borrower under the Loan.


(c)           The Borrower shall give the
Administrative Agent written notice at least 5 Business Days prior to the
requested date of issuance of a Letter of Credit, such notice to describe in
reasonable detail the proposed terms of such Letter of Credit and the nature of
the transactions or obligations proposed to be supported by such Letter of
Credit, and in any event shall set forth with respect to such Letter of Credit
the proposed (i) initial Stated Amount, (ii) the beneficiary, and (iii)
expiration date. The Borrower shall also execute and deliver such customary
applications and agreements for standby letters of credit, and other forms as
requested from time to time by the Administrative Agent.  Provided the Borrower has given the notice
prescribed by the first sentence of this subsection and delivered such
application and agreements referred to in the preceding sentence, subject 


 


10

















to the other terms and conditions of this Agreement,
including the satisfaction of any applicable conditions precedent set forth in
Article 3.1, the Administrative Agent shall issue the requested Letter of
Credit on the requested date of issuance for the benefit of the stipulated
beneficiary but in no event prior to the date 5 Business Days following the
date after which the Administrative Agent has received all of the items
required to be delivered to it under this subsection.  Upon the written request of the Borrower, the
Administrative Agent shall deliver to the Borrower a copy of (i) any Letter of
Credit proposed to be issued hereunder prior to the issuance thereof and (ii)
each issued Letter of Credit within a reasonable time after the date of
issuance thereof.  To the extent any term
of a Letter of Credit Document is inconsistent with a term of any Loan
Document, the term of such Loan Document shall control.


(d)           Upon receipt by the Administrative
Agent from the beneficiary of a Letter of Credit of any demand for payment
under such Letter of Credit, the Administrative Agent shall promptly notify the
Borrower of the amount to be paid by the Administrative Agent as a result of
such demand and the date on which payment is to be made by the Administrative
Agent to such beneficiary in respect of such demand.  The Borrower hereby absolutely, unconditionally
and irrevocably agrees to pay and reimburse the Administrative Agent for the
amount of each demand for payment under such Letter of Credit at or prior to
the date on which payment is to be made by the Administrative Agent to the
beneficiary thereunder, without presentment, demand, protest or other
formalities of any kind (“Reimbursement Obligation”).  Upon receipt by the Administrative Agent of
any payment in respect of any Reimbursement Obligation, the Administrative
Agent shall promptly pay to each Lender that has acquired a participation
therein such Lender’s Pro Rata Share of such payment.


(e)           Upon its receipt of a notice referred
to in the immediately preceding subsection (d), the Borrower shall advise the
Administrative Agent whether or not the Borrower intends to borrow hereunder to
finance its obligation to reimburse the Administrative Agent for the amount of
the related demand for payment and, if it does, the Borrower shall submit a
timely request for such borrowing as provided in the applicable provisions of
this Agreement.  If the Borrower fails to
so advise the Administrative Agent, or if the Borrower fails to reimburse the
Administrative Agent for a demand for payment under a Letter of Credit by the
date of such payment, then the Administrative Agent shall give each Lender
prompt notice thereof and of the amount of the demand for payment, specifying
such Lender’s Pro Rata Share of the amount of the related demand for payment
and the provisions of subsection (j) of this Section shall apply.


(f)            Upon the issuance by the
Administrative Agent of any Letter of Credit and until such Letter of Credit
shall have expired or been terminated, the Commitment of each Lender shall be
deemed to be utilized for all purposes of this Agreement in an amount equal to
the product of (i) such Lender’s Pro Rata Share and (ii) the sum of (A) the
Stated Amount of such Letter of Credit plus (B) any related Reimbursement
Obligations then outstanding.


(g)           In examining documents presented in
connection with drawings under Letters of Credit and making payments under such
Letters of Credit against such documents, the Administrative Agent shall only
be required to use the same standard of care as it uses in connection with
examining documents presented in connection with drawings under letters of
credit in which it has not sold participations and making payments under such
letters of credit.  The Borrower assumes
all risks of the acts and omissions of, or misuse of the Letters of Credit by,
the respective beneficiaries of such Letters of Credit.  In furtherance and not in limitation of the
foregoing, neither the Administrative Agent nor any of the Lenders shall be
responsible for (i) the form, validity, sufficiency, accuracy, genuineness or
legal effects of any document submitted by any party in connection with the
application for and issuance of or any drawing honored under any Letter of
Credit even if such document should in fact prove to be in any or all respects
invalid, insufficient, inaccurate, fraudulent or forged; (ii) the validity or
sufficiency of any instrument transferring or assigning or purporting to
transfer or assign any Letter of Credit, or the rights or benefits thereunder
or proceeds thereof, in whole or in part, which may prove to be invalid or
ineffective for any reason; (iii) failure of the beneficiary of any Letter of
Credit to comply fully with conditions required in order to draw upon such
Letter of Credit; (iv) errors, omissions, interruptions or delays in
transmission or delivery of any messages, by mail, cable, telex, telecopy or
otherwise, whether or not they be in cipher; (v) errors in interpretation of
technical terms; (vi) any loss or delay in the transmission or otherwise of any



 


11

















document required in order to make a drawing under any
Letter of Credit, or of the proceeds thereof; (vii) the misapplication by the
beneficiary of any Letter of Credit, or of the proceeds of any drawing under
any Letter of Credit; or (viii) any consequences arising from causes beyond the
control of the Administrative Agent or the Lenders .  None of the above shall affect, impair or
prevent the vesting of any of the Administrative Agent’s rights or powers
hereunder.  Any action taken or omitted
to be taken by the Administrative Agent under or in connection with any Letter
of Credit, if taken or omitted in the absence of gross negligence or willful
misconduct, shall not create against the Administrative Agent any liability to
the Borrower or any Lender.  In this
connection, the obligation of the Borrower to reimburse the Administrative
Agent for any drawing made under any Letter of Credit shall be absolute,
unconditional and irrevocable and shall be paid strictly in accordance with the
terms of this Agreement or any other applicable Letter of Credit Document under
all circumstances whatsoever, including without limitation, the following
circumstances: (A) any lack of validity or enforceability of any Letter of
Credit Document or any term or provisions therein; (B) any amendment or waiver
of or any consent to departure from all or any of the Letter of Credit
Documents; (C) the existence of any claim, setoff, defense or other right which
the Borrower may have at any time against the Administrative Agent, any Lender,
any beneficiary of a Letter of Credit or any other Person, whether in
connection with this Agreement, the transactions contemplated hereby or in the
Letter of Credit Documents or any unrelated transaction; (D) any breach of
contract or dispute between the Borrower, the Administrative Agent, any Lender
or any other Person; (E) any demand, statement or any other document presented
under a Letter of Credit proving to be forged, fraudulent, invalid or
insufficient in any respect or any statement therein or made in connection
therewith being untrue or inaccurate in any respect whatsoever; (F) any non
application or misapplication by the beneficiary of a Letter of Credit or of
the proceeds of any drawing under such Letter of Credit; (G) payment by the
Administrative Agent under the Letter of Credit against presentation of a draft
or certificate which does not strictly comply with the terms of the Letter of
Credit; and (H) any other act, omission to act, delay or circumstance
whatsoever that might, but for the provisions of this Section, constitute a
legal or equitable defense to or discharge of the Borrower’s Reimbursement
Obligations.


(h)           The issuance by the Administrative
Agent of any amendment, supplement or other modification to any Letter of
Credit shall be subject to the same conditions applicable under this Agreement
to the issuance of new Letters of Credit (including, without limitation, that
the request therefor be made through the Administrative Agent), and no such
amendment, supplement or other modification shall be issued unless either (i)
the respective Letter of Credit affected thereby would have complied with such
conditions had it originally been issued hereunder in such amended,
supplemented or modified form or (ii) the Administrative Agent and Requisite Lenders
shall have consented thereto.  In
connection with any such amendment, supplement or other modification, the
Borrower shall pay the fees, if any, payable under Section 2.4(l) below.


(i)            Immediately upon the issuance by the
Administrative Agent of any Letter of Credit each Lender shall be deemed to
have absolutely, irrevocably and unconditionally purchased and received from
the Administrative Agent, without recourse or warranty, an undivided interest
and participation to the extent of such Lender’s Pro Rata Share of the
liability of the Administrative Agent with respect to such Letter of Credit and
each Lender thereby shall absolutely, unconditionally and irrevocably assume,
as primary obligor and not as surety, and shall be unconditionally obligated to
the Administrative Agent to pay and discharge when due, such Lender’s Pro Rata
Share of the Administrative Agent’s liability under such Letter of Credit.  In addition, upon the making of each payment
by a Lender to the Administrative Agent in respect of any Letter of Credit
pursuant to the immediately following subsection (j), such Lender shall,
automatically and without any further action on the part of the Administrative
Agent or such Lender, acquire (i) a participation in an amount equal to such
payment in the Reimbursement Obligation owing to the Administrative Agent by
the Borrower in respect of such Letter of Credit and (ii) a participation in a
percentage equal to such Lender’s Pro Rata Share in any interest or other
amounts payable by the Borrower in respect of such Reimbursement Obligation
(other than the fees payable to the Administrative Agent pursuant to Section
2.4(l) below).


(j)            Each Lender severally agrees to pay
to the Administrative Agent on demand in immediately available funds in Dollars
the amount of such Lender’s Pro Rata Share of each drawing paid by the
Administrative Agent under each Letter of Credit to the extent such amount is
not reimbursed by 


 


12

















the Borrower pursuant to Section 2.4(d);
provided, however, that in respect of any drawing under any Letter of Credit,
the maximum amount that any Lender shall be required to fund, whether as an
Advance or as a participation, shall not exceed such Lender’s Pro Rata Share of
such drawing.  Each Lender’s obligation
to make such payments to the Administrative Agent under this subsection, and
the Administrative Agent’s right to receive the same, shall be absolute,
irrevocable and unconditional and shall not be affected in any way by any
circumstance whatsoever, including without limitation, (i) the failure of any
other Lender to make its payment under this subsection, (ii) the financial
condition of the Borrower or any other Loan Party, (iii) the existence of any
Default or Potential Default, including any Default described in Section 9.1
(f). 9.1(g) or 9.1(k) or (iv) the termination of the Commitments.  Each such payment to the Administrative Agent
shall be made without any offset, abatement, withholding or deduction
whatsoever.


(k)           Promptly following any change in
Letters of Credit outstanding, the Administrative Agent shall deliver to each
Lender and the Borrower a notice describing the aggregate amount of all Letters
of Credit outstanding at such time.  Upon
the request of any Lender from time to time, the Administrative Agent shall
deliver any other information reasonably requested by such Lender with respect
to each Letter of Credit then outstanding. 
Other than as set forth in this subsection, the Administrative Agent
shall have no duty to notify the Lenders regarding the issuance or other
matters regarding Letters of Credit issued hereunder.  The failure of the Administrative Agent to
perform its requirements under this subsection shall not relieve any Lender
from its obligations under the immediately preceding subsection (j).


(l)            The Borrower shall pay to the
Administrative Agent for the account of each Lender in accordance with its Pro
Rata Share a Letter of Credit fee (the “Letter of Credit Fee”) per annum for
each Letter of Credit equal to one percent (1.00%) times the Stated Balance of
such Letter of Credit.  The Letter of
Credit Fee shall be (i) due and payable on the first Business Day after the end
of each of March, June, September and December, commencing with the first such
date to occur after the issuance of each Letter of Credit, on the expiration
date for such Letter of Credit and thereafter on demand and (ii) computed on a
quarterly basis in arrears. The Borrower shall pay also directly to the
Administrative Agent, as issuer, for its own account a fronting fee with
respect to each Letter of Credit, at the rate per annum equal to one-tenth of
one percent (0.10%) of the Stated Amount of the Letter of Credit and such other
customary issuance, presentation, amendment and other processing fees, and
other standard costs and charges, of the Administrative Agent relating to
letters of credit as from time to time in effect.  Such fronting fee shall be due and payable on
the tenth Business Day after the end of each March, June, September and December in respect of the most recently-ended
quarterly period (or portion thereof, in the case of the first payment),
commencing with the first such date to occur after the issuance of such Letter
of Credit, on the expiration date of such Letter of Credit and thereafter on
demand. The Letter of Credit Fee and all other fees and standard costs and
charges shall be deemed fully earned when paid and nonrefundable.


                2.5           SWINGLINE LOANS.


 


(a)           Subject to the terms and conditions
hereof, the Swingline Lender agrees to make Swingline Loans to the Borrower,
during the period from the Effective Date to but excluding the Swingline
Termination Date, in an aggregate principal amount at any one time outstanding
up to, but not exceeding, $5,000,000.00, as such amount may be reduced from
time to time in accordance with the terms hereof.  If at any time the aggregate principal amount
of the Swingline Loans outstanding at such time exceeds the Swingline
Commitment in effect at such time, the Borrower shall immediately pay the Administrative
Agent for the account of the Swingline Lender the amount of such excess.  Subject to the terms and conditions of this
Agreement, the Borrower may borrow, repay and reborrow Swingline Loans
hereunder.  To the extent any of the
terms of Section 2.10 or 2.11 are inconsistent with the terms of this Section
2.5, the terms of this Section 2.5 shall control.


(b)           The Borrower shall give the
Administrative Agent and the Swingline Lender notice pursuant to a Notice of
Swingline Borrowing delivered no later than noon San Francisco time on the
proposed date of such borrowing.  Any
such telephonic notice shall include all information to be 


 


13

















specified in a written Application for Advance.  Not later than 2:00 p.m. San Francisco time
on the date of the requested Swingline Loan and subject to satisfaction of the
applicable conditions set forth in Article 3.1, the Swingline Lender will make
the proceeds of such Swingline Loan available to the Borrower in Dollars, in
immediately available funds, at the account specified by the Borrower in the
Application for Advance.


(c)           Swingline Loans shall bear interest
at a per annum rate equal to the Variable Rate as in effect from time to time
or at such other rate or rates as the Borrower and the Swingline Lender may
agree from time to time in writing.  All
accrued and unpaid interest on Swingline Loans shall be payable on the dates
and in the manner provided in Section 2.11 with respect to interest on
Variable Rate Advances (except as the Swingline Lender and the Borrower may
otherwise agree in writing in connection with any particular Swingline Loan).


(d)           Each Swingline Loan shall be in the
minimum amount of $200,000.00 and integral multiples of $100,000.00 in excess
thereof, or such other minimum amounts agreed to by the Swingline Lender and
the Borrower.  Any voluntary prepayment
of a Swingline Loan must be in integral multiples of $100,000.00 or the
aggregate principal amount of all outstanding Swingline Loans (or such other
minimum amounts upon which the Swingline Lender and the Borrower may agree) and
in connection with any such prepayment, the Borrower must give the Swingline
Lender prior written notice thereof no later than noon San Francisco time on
the day prior to the date of such prepayment. 
The Swingline Loans shall, in addition to this Agreement, be evidenced
by the Swingline Note.


(e)           The Borrower agrees to repay each
Swingline Loan within three (3) Business Days of demand therefor by the
Swingline Lender and, in any event, within five (5) Business Days after the
date such Swingline Loan was made. 
Notwithstanding the foregoing, the Borrower shall repay the entire
outstanding principal amount of, and all accrued but unpaid interest on, the
Swingline Loans on the Swingline Termination Date (or such earlier date as the
Swingline Lender and the Borrower may agree in writing).  In lieu of demanding repayment of any
outstanding Swingline Loan from the Borrower, the Swingline Lender may, on
behalf of the Borrower (which hereby irrevocably directs the Swingline Lender
to act on its behalf), request a borrowing of a Variable Rate Advance from the
Lenders in an amount equal to the principal balance of such Swingline
Loan.  The amount limitations contained
in Section  2.2 shall not apply to any
borrowing of Variable Rate Advances made pursuant to this subsection.  The Swingline Lender shall give notice to the
Administrative Agent of any such borrowing of Variable Rate Advance not later
than noon San Francisco time at least one Business Day prior to the proposed
date of such borrowing.  Each Lender will
make available to the Administrative Agent for the account of the Swingline
Lender, in immediately available funds, the proceeds of the Variable Rate
Advance to be made by such Lender.  The
Administrative Agent shall pay the proceeds of such Variable Rate Advance to
the Swingline Lender, which shall apply such proceeds to repay such Swingline
Loan.  If the Lenders are prohibited from
making Loans required to be made under this subsection for any reason
whatsoever, including without limitation, the occurrence of any of the Defaults
or Potential Defaults described in Sections Section 9.1 (f). 9.1(g) or
9.1(k), each Lender shall purchase from the Swingline Lender, without
recourse or warranty, an undivided interest and participation to the extent of
such Lender’s Pro Rata Share of such Swingline Loan, by directly purchasing a
participation in such Swingline Loan in such amount and paying the proceeds
thereof to the Administrative Agent for the account of the Swingline Lender in
Dollars and in immediately available funds. 
A Lender’s obligation to purchase such a participation in a Swingline
Loan shall be absolute and unconditional and shall not be affected by any
circumstance whatsoever, including without limitation, (i) any claim of setoff,
counterclaim, recoupment, defense or other right which such Lender or any other
Person may have or claim against the Administrative Agent, the Swingline Lender
or any other Person whatsoever, (ii) the occurrence or continuation of a
Default or Potential Default (including without limitation, any of the Defaults
or Potential Defaults described in Section 9.1 (f). 9.1(g) or 9.1(k), or
the termination of any Lender’s Commitment, (iii) the existence (or alleged
existence) of an event or condition which has had or could have a Material
Adverse Effect, (iv) any breach of any Loan Document by the Administrative
Agent, any Lender or the Borrower or (v) any other circumstance, happening or
event whatsoever, whether or not similar to any of the foregoing.  If such amount is not in fact made available
to the Swingline Lender by any Lender, the Swingline Lender shall be entitled
to recover such amount on demand from such Lender, together with


 


14




















accrued
interest thereon for each day from the date of demand thereof, at the Federal
Funds Rate.  If such Lender does not pay
such amount forthwith upon the Swingline Lender’s demand therefor, and until
such time as such Lender makes the required payment, the Swingline Lender shall
be deemed to continue to have outstanding Swingline Loans in the amount of such
unpaid participation obligation for all purposes of the Loan Documents (other
than those provisions requiring the other Lenders to purchase a participation
therein).  Further, such Lender shall be
deemed to have assigned any and all payments made of principal and interest
payable to it in respect of the Loan, and any other amounts due it hereunder,
to the Swingline Lender to fund Swingline Loans in the amount of the
participation in Swingline Loans that such Lender failed to purchase pursuant
to this Section until such amount has been purchased (as a result of such
assignment or otherwise).


2.6           LOAN FEES.


 


Borrower shall pay to
Administrative Agent for Administrative Agent’s sole benefit certain fees, each
in the amount and at the times as set forth in a separate letter agreement
dated August 23, 2007 between Borrower and Wells Fargo.


2.7           LOAN DOCUMENTS.


 


Borrower shall execute and deliver to Administrative
Agent (or cause to be executed and delivered) concurrently with this Agreement
each of the documents, properly executed and in recordable form, as applicable,
described in Exhibit B as Loan 
Documents, together with those documents described in Exhibit B
as Other Related Documents.


2.8           EFFECTIVE DATE.


 


The date of the Loan Documents is for reference
purposes only.  The Effective Date of
delivery and transfer to Administrative Agent of the security under the Loan
Documents and of Borrower’s and Lenders’ obligations under the Loan Documents
shall be the date the Mortgage is recorded in the Bureau of Conveyances of the
State of Hawaii and/or the Office of the Assistant Registrar of the Land Court
of the State of Hawaii, as applicable.


2.9           MATURITY DATE.


 


All sums due and owing under this Agreement and the
other Loan Documents shall be repaid in full on or before the Maturity
Date.  All payments due to Administrative
Agent and Lenders under this Agreement, whether at the Maturity Date or
otherwise, shall be paid in Dollars in immediately available funds.


2.10         INTEREST ON THE LOAN.  


 


(a)        Interest Payments.  Interest
accrued on the outstanding principal balance of the Loan shall be due and
payable in arrears, in the manner provided in Section 2.11, on the first
day of each month commencing with the first month after the Effective Date.


(b)        Default Interest.  Notwithstanding
the rates of interest specified in Sections 2.10(e) below and the
payment dates specified in Section 2.10(a), at Requisite Lenders
discretion at any time following the occurrence and during the continuance of
any Default, the principal balance of the Loan then outstanding and, to the
extent permitted by applicable law, any interest payments on the Loan not paid
when due, shall bear interest payable upon demand at the Alternate Rate.  All other amounts due Administrative Agent or
Lenders (whether directly or for reimbursement) under this Agreement or any of
the other Loan Documents if not paid when due, or if no time period is
expressed, if not paid within ten (10) days after demand, shall likewise, at
the option of Requisite Lenders, bear interest from and after demand at the
Alternate Rate.


(c)           Late Fee.  Borrower acknowledges that late payment to
Administrative Agent will cause Administrative Agent and Lenders to incur costs
not contemplated by this Agreement.  Such
costs 


 


15

















include, without limitation, processing and accounting
charges.  Therefore, if Borrower fails
timely to pay any sum due and payable hereunder through the Maturity Date
(other than payment of the entire outstanding balance of the Loan on the
Maturity Date), unless waived by Administrative Agent, a late charge of four
cents ($.04) for each dollar of any such principal payment, interest or other
charge due hereon and which is not paid within fifteen (15) days after such
payment is due, shall be charged by Administrative Agent (for the benefit of
Lenders) and paid by Borrower for the purpose of defraying the expense incident
to handling such delinquent payment. 
Borrower and Administrative Agent agree that this late charge represents
a reasonable sum considering all of the circumstances existing on the date
hereof and represents a fair and reasonable estimate of the costs that
Administrative Agent and Lenders will incur by reason of late payment.  Borrower and Administrative Agent further
agree that proof of actual damages would be costly and inconvenient.  Acceptance of any late charge shall not
constitute a waiver of the default with respect to the overdue installment, and
shall not prevent Administrative Agent from exercising any of the other rights
available hereunder or any other Loan Document. 
Such late charge shall be paid without prejudice to any other rights of
Administrative Agent.


(d)             Computation of Interest.  Interest shall be computed on the basis of the
actual number of days elapsed in the period during which interest or fees
accrue and a year of three hundred sixty (360) days on the principal balance of
the Loan outstanding from time to time. 
In computing interest on the Loan, the date of the making of a
disbursement under the Loan shall be included and the date of payment shall be
excluded.  Notwithstanding any provision
in this Section 2.10, interest in respect of the Loan shall not exceed
the maximum rate permitted by applicable law.


(e)           Effective Rate.  The “Effective Rate” upon which interest shall
be calculated for the Loan shall, from and after the Effective Date of this
Agreement, be one or more of the following:


(i)            Provided no Default exists under
this Agreement:


(A)                  for those portions of the
principal balance of the Notes which are not Fixed Rate Portions, the Effective
Rate shall be the Variable Rate.


(B)                   for those portions of the
principal balance of the Notes which are Fixed Rate Portions, the Effective
Rate for the Fixed Rate Period thereof shall be the Fixed Rate selected by
Borrower and set in accordance with the provisions hereof, provided, however,
if any of the transactions necessary for the calculation of interest at any
Fixed Rate requested or selected by Borrower should be or become prohibited or
unavailable to Administrative Agent, or, if in Administrative Agent ‘s good
faith judgment, it is not possible or practical for Administrative Agent to set
a Fixed Rate for a Fixed Rate Portion and Fixed Rate Period as requested or
selected by Borrower, the Effective Rate for such Fixed Rate Portion shall
remain at or revert to the Variable Rate.


(ii)           During such time as a Default exists
under this Agreement; or from and after the date on which all sums owing under
the Notes become due and payable by acceleration or otherwise; or from and
after the date on which the Collateral or any portion thereof or interest
therein, is sold, transferred, mortgaged, assigned, or encumbered (except for
Permitted Liens), whether voluntarily or involuntarily, or by operation of law
or otherwise, without Administrative Agent’s prior written consent (whether or
not the sums owing under the Notes become due and payable by acceleration); or
from and after the Maturity Date, then at the option of Requisite Lenders in
each case, the interest rate applicable to the then outstanding principal
balance of the Loan shall be the Alternate Rate.


(f)            Selection of Fixed Rate.  Provided no Default exists under this
Agreement, Borrower, at its option and upon satisfaction of the conditions set
forth herein, may request a Fixed Rate as the Effective Rate for calculating
interest on the portion of the unpaid principal balance and for the period
selected in accordance with and subject to the following procedures and
conditions, provided, however, that Borrower may not have in effect at
any one time more than ten (10) Fixed Rates:


 


16

















(i)            Borrower shall deliver to the
Disbursement and Operations Center of Administrative Agent, 2120 East Park
Place, Suite 100, El Segundo, California, 90245, Attention Eva Lopez, with a
copy to: Administrative Agent, Wells Fargo Real Estate Group, 1357 Kapiolani
Blvd, Suite 910, Honolulu, HI 96814, Attention: Guy Churchill, or such other
addresses as Administrative Agent shall designate, an original or facsimile
Fixed Rate Notice no later than 12 noon (California time), and not less than
three (3) nor more than five (5) Business Days prior to the proposed Fixed Rate
Period for each Fixed Rate Portion.  Any
Fixed Rate Notice pursuant to this subsection (i) is irrevocable.


Administrative Agent is
authorized to rely upon the telephonic request and acceptance of Fred Rickert,
Adele Sumida, Danny Hong, Dan Ligienza or Robert Webber as Borrower’s duly
authorized agents, or such additional authorized agents as Borrower shall
designate in writing to Administrative Agent. 
Borrower’s telephonic notices, requests and acceptances shall be
directed to such officers of Administrative Agent as Administrative Agent may
from time to time designate.


(ii)           Borrower may elect (A) to convert
Variable Rate Advances to a Fixed Rate Portion, or (B) to convert a matured
Fixed Rate Portion into a new Fixed Rate Portion, provided, however,
that the aggregate amount of the advance being converted into or continued as a
Fixed Rate Portion shall comply with the definition thereof as to Dollar
amount.  The conversion of a matured
Fixed Rate Portion back to a Variable Rate or to a new Fixed Rate Portion shall
occur on the last Business Day of the Fixed Rate Period relating to such Fixed
Rate Portion.  Each Fixed Rate Notice
shall specify (A) the amount of the Fixed Rate Portion, (B) the Fixed Rate
Period, and (C) the Fixed Rate Commencement Date.


(iii)          Upon receipt of a Fixed Rate Notice in
the proper form requesting an Advance constituting a Fixed Rate Portion under
subsections (i) and (ii) above, Administrative Agent shall determine the Fixed
Rate applicable to the Fixed Rate Period for such Fixed Rate Portion two (2)
Business Days prior to the beginning of such Fixed Rate Period.  Each determination by Administrative Agent of
the Fixed Rate shall be conclusive and binding upon the parties hereto in the
absence of manifest error. 
Administrative Agent shall deliver to Borrower and each Lender (by
facsimile) an acknowledgment of receipt and confirmation of the Fixed Rate
Notice; provided, however, that failure to provide such
acknowledgment of receipt and confirmation of the Fixed Rate Notice to Borrower
or any Lender shall not affect the validity of such rate.


(iv)          If Borrower does not make a timely
election to convert all or a portion of a matured Fixed Rate Portion into a new
Fixed Rate Portion in accordance with this Section 2.10(f) above,
such Fixed Rate Portion shall be automatically converted  back
to a Variable Rate upon the expiration of the Fixed Rate Period applicable to
such Fixed Rate Portion.


(g)           Fixed Rate Taxes, Regulatory Costs
and Reserve Percentages.     Upon Administrative Agent’s demand, Borrower
shall pay to Administrative Agent for the account of each Lender, in addition
to all other amounts which may be, or become, due and payable under this
Agreement and the other Loan Documents, any and all Fixed Rate Taxes and
Regulatory Costs, to the extent they are not internalized by calculation of a
Fixed Rate.  Further, at Administrative
Agent’s option, the Fixed Rate shall be automatically adjusted by adjusting the
Reserve Percentage, as determined by Administrative Agent in its prudent
banking judgment, from the date of imposition (or subsequent date selected by
Administrative Agent) of any such Regulatory Costs.  Administrative Agent shall give Borrower
notice of any Fixed Rate Taxes and Regulatory Costs as soon as practicable
after their occurrence, but Borrower shall be liable for any Fixed Rate Taxes
and Regulatory Costs regardless of whether or when notice is so given


(h)           Fixed Rate Price Adjustment.  Borrower acknowledges that prepayment or acceleration
of a Fixed Rate Portion during a Fixed Rate Period shall result in Lenders’
incurring additional costs, expenses and/or liabilities and that it is
extremely difficult and impractical to ascertain the extent of such costs,
expenses and/or liabilities.  Therefore,
on the date a Fixed Rate Portion is prepaid or the date all sums payable
hereunder become due and payable, by acceleration or otherwise (“Price  


 


17

















Adjustment Date”), Borrower will pay Administrative Agent, for the
account of each Lender (in addition to all other sums then owing to Lenders) an
amount (“Fixed Rate Price Adjustment”) equal to the then present value
of (i) the amount of interest that would have accrued on the Fixed Rate Portion
for the remainder of the Fixed Rate Period at the Fixed Rate set on the Fixed
Rate Commencement Date, less (ii) the amount of interest that would accrue on
the same Fixed Rate Portion for the same period if the Fixed Rate were set on
the Price Adjustment Date at the Applicable LIBO Rate in effect on the Price
Adjustment Date.  The present value shall
be calculated by using as a discount rate the LIBO Rate quoted on the Price
Adjustment Date.


By initialing this provision where indicated below,
Borrower confirms that Lenders’ agreement to make the Loan at the interest
rates and on the other terms set forth herein and in the other Loan Documents
constitutes adequate and valuable consideration, given individual weight by
Borrower, for this Agreement


                Borrower
Initials.  _______________


(i)            Purchase, Sale and Matching of
Funds.  Borrower understands, agrees
and acknowledges the following: (a) Lenders have no obligation to purchase,
sell and/or match funds in connection with the use of a LIBO Rate as a basis
for calculating a Fixed Rate or Fixed Rate Price Adjustment; (b) a LIBO Rate is
used merely as a reference in determining a Fixed Rate and Fixed Rate Price
Adjustment; and (c) Borrower has accepted a LIBO Rate as a reasonable and fair
basis for calculating a Fixed Rate and a Fixed Rate Price Adjustment.  Borrower further agrees to pay the Fixed Rate
Price Adjustment, Fixed Rate Taxes and Regulatory Costs, if any, whether or not
any Lender elects to purchase, sell and/or match funds.


2.11         PAYMENTS.


 


(a)           Manner and Time of Payment.  All payments of principal, interest and fees
hereunder payable to Administrative Agent or the Lenders shall be made without
condition or reservation of right and free of set-off or counterclaim, in
Dollars and by wire transfer (pursuant to Administrative Agent’s written wire
transfer instructions) of immediately available funds, to Administrative Agent,
for the account of each Lender as applicable, not later than 12 noon (San
Francisco time) on the date due; and funds received by Administrative Agent
after that time and date shall be deemed to have been paid on the next
succeeding Business Day.


(b)           Payments on Non-Business Days.  Whenever any payment to be made by Borrower
hereunder shall be stated to be due on a day which is not a Business Day,
payments shall be made on the next succeeding Business Day and such extension
of time shall be included in the computation of the payment of interest
hereunder and of any fees due under this Agreement, as the case may be.


(c)           Direct Debit.  In order to assure timely payment to
Administrative Agent, for the benefit of Lenders, of accrued interest,
principal, fees and late charges due and owing under the Loan, Borrower hereby
irrevocably authorizes Administrative Agent to directly debit the Account for payment
when due of all such amounts payable to Administrative Agent or any Lender.
Borrower represents and warrants to Administrative Agent and Lenders that
Borrower is the legal owner of the Account. 
Written confirmation of the amount and purpose of any such direct debit
shall be given to Borrower by Administrative Agent not less frequently than
monthly.  In the event any direct debit
hereunder is returned for insufficient funds, Borrower shall pay Administrative
Agent, for the benefit of Lenders, upon demand, in immediately available
funds,  all amounts and expenses due and
owing, including without limitation any late fees incurred, to Administrative
Agent or any Lender.


(d)           Voluntary Prepayment.  Borrower may, upon not less than three (3)
Business Days’, for any Fixed Rate Portion, or the same day for any Variable
Rate Advance, prior written notice to Administrative Agent not later than 12
noon (San Francisco time) on the date given, at any time and from time to time,
prepay all or any portion of the Loan without penalty, except as otherwise
expressly set forth in this Section 2.11(d).  Any notice of prepayment given to
Administrative Agent under this Section 2.11(d) shall specify the
date of prepayment and the principal amount of the prepayment.  In the 


 


18

















event of a prepayment of any Fixed Rate Portion,
Borrower shall concurrently pay any Fixed Rate Price Adjustment payable in
respect thereof.


(e)           Reduction or Termination of
Commitment.  The Borrower may, upon
notice to the Administrative Agent, terminate or cancel, in whole or in part,
the unused portion of the Credit Limit in excess of the outstanding aggregate
amount of the Advances (including Swingline Loans), Letter of Credit
Liabilities and Interest Holdback or from time to time permanently reduce such
portion of the Credit Limit; provided that (i) any such notice shall be
received by the Administrative Agent not later than noon (San Francisco
time)  three Business Days prior to the
date of termination or reduction, (ii) any such partial reduction shall be in
an aggregate amount of $5,000,000 or any whole multiple of $1,000,000 in excess
thereof, (iii) the Borrower shall not terminate or reduce the Credit Limit if,
after giving effect thereto and to any concurrent prepayments hereunder, the
aggregate amount of the Advances (including Swingline Loans), Letter of Credit
Liabilities and Interest Holdback would exceed the Credit Limit.  The Administrative Agent will promptly notify
the Lenders of any such notice of termination or reduction of the Credit
Limit.  Any reduction of the Credit Limit
shall be applied to the Commitment of each Lender according to its Pro Rata
Share.


2.12         FULL REPAYMENT AND RECONVEYANCE.


 


Upon receipt of all sums owing and outstanding under
the Loan Documents, Administrative Agent shall issue a full release or
reconveyance of the Property from the lien of the Mortgage; provided, however,
that all of the following conditions shall be satisfied at the time of, and
with respect to, such reconveyance: 
(a) Administrative Agent, for the benefit of Lenders, shall have
received all escrow, closing and recording costs, the costs of preparing and
delivering such reconveyance and any sums then due and payable under the Loan
Documents; and (b) Administrative Agent shall have received a written
release satisfactory to Administrative Agent of any set aside letter, letter of
credit or other form of undertaking which Administrative Agent or any Lender
has issued to any surety, Governmental Authority or any other party in
connection with the Loan and/or the Property. 
Lenders’ obligations to make further disbursements under the Loan shall
terminate as to any portion of the Loan undisbursed as of the date of issuance
of such full release or reconveyance, and any commitment of Lenders to lend any
undisbursed portion of the Loan shall be canceled.


2.13         LENDERS’ ACCOUNTING.


 


Administrative Agent shall maintain a loan account
(the “Loan Account”) on its books in which shall be recorded (a) the
names and addresses and the Pro Rata Shares of the commitment of each of the
Lenders, and principal amount of the Loan owing to each Lender from time to
time, and (b) all repayments of principal and payments of accrued interest, as
well as payments of fees required to be paid pursuant to this Agreement.  All entries in the Loan Account shall be made
in accordance with Administrative Agent’s customary accounting practices as in
effect from time to time.  Monthly or at
such other interval as is customary with Administrative Agent’s practice,
Administrative Agent will render a statement of the Loan Account to Borrower
and will deliver a copy thereof to each Lender. 
Each such statement shall be deemed final, binding and conclusive upon
Borrower in all respects as to all matters reflected therein (absent manifest
error).


2.14         OPTION TO EXTEND.


 


(a)           Borrower may request successive
one-year extensions of the Maturity Date by delivering a written request (a “Request
to Extend”) therefor to the Administrative Agent not more than ninety (90) days
but not less than thirty (30) days prior to the date which is one (1) year
prior to the then scheduled Maturity Date (such then scheduled Maturity Date
before giving effect to the requested extension which is the subject of such
Request to Extend being referred to herein as the “Then Scheduled Maturity Date”
and such date which is one (1) year prior to such Then Scheduled Maturity Date
being referred to herein as the “Extension Date”).  The Administrative Agent shall notify the
Lenders of the receipt of such request, and each Lender shall give notice in
writing to the Administrative Agent not later than ten (10) days after receipt
of such notification from Administrative Agent of such Lender’s 


 


19

















acceptance or rejection of such request.  Each Lender that determines not to so extend
its Maturity Date is herein referred to as a “Non Extending Lender” and any
Lender that does not timely advise the Administrative Agent of its decision to
extend or not to extend shall be also be deemed to have agreed to extend its
Maturity Date (an “Extending Lender”). 
The Administrative Agent shall notify the Borrower of each Lender’s
determination under this Section no later than the Extension Date (or, if such
date is not a Business Day, on the next preceding Business Day).


(b)           If (and only if) Wells Fargo, N.A.
shall have elected to be an Extending Lender, then, effective as of the
Extension Date, the Maturity Date of each Extending Lender shall be extended to
the date falling one year after the Then Scheduled Maturity Date (except that,
if such date is not a Business Day, such Maturity Date as so extended shall be
the next preceding Business Day).  The
Maturity Date of each Non Extending Lender shall remain the Then Scheduled
Maturity Date.


(c)           Any extension of the Maturity Date
shall be subject to each of the following conditions precedent on the
applicable Extension Date:


(i)            As of the date of Borrower’s
delivery of the Request to Extend, and as of the Extension Date, no Default
shall have occurred and be continuing, and no event or condition which, with
the giving of notice or the passage of time or both, would constitute a Default
shall have occurred and be continuing, and Borrower shall so certify in writing;
and


(ii)           Borrower shall execute or cause the
execution of all documents reasonably required by Administrative Agent to
exercise the option to extend; and


(iii)          There shall have occurred no Material
Adverse Effect, as determined by Administrative Agent in its sole discretion,
since the Effective Date; and


(iv)          On the Extension Date, Borrower shall
pay to Administrative Agent for the ratable benefit of the Lenders an extension
fee in the amount of fifteen one-hundredths of one percent (0.15 %) of the
total commitment amount of the Loan (whether disbursed or undisbursed), as
determined on the Extension Date; and


(v)           At the sole option of Administrative
Agent, an Appraisal confirming to the satisfaction of the Administrative Agent
that the Credit Limit (whether disbursed or not and as reduced by the
Commitments of any Non-Extending Lenders) as a percentage of the as-is value of
the Property does not exceed fifty-five percent (55%) (“Loan-to-Value
Percentage”), based on an as-is appraisal value of the Commercial Property and
the as-is value (as such term is used in the Initial Mauka Apprasial) of
Kapalua Mauka (or the portion thereof which remains Collateral); provided,
however, in the event such appraised value is not adequate to meet the required
Loan-to-Value Percentage, then Borrower shall pay down the outstanding
principal balance of the Loan (to the extent necessary) and the Credit Limit
shall be permanently reduced such that said Loan to-Value Percentage may be
met.  The valuation date of such
appraisal shall be within thirty (30) days of the Extension Date; and.


(vi)          Except as modified by the option to
extend described herein, the terms and conditions of this Agreement and the
other Loan Documents as modified and approved by the Administrative Agent and
the Lenders shall remain unmodified and in full force and effect.


(d)           On the Maturity Date of each
Non-Extending Lender, the Borrower shall repay for the account of the Non
Extending Lenders aggregate Advances, accrued but unpaid interest thereon, and
any related Fixed Rate Priced Adjustment to the extent necessary to reduce the
amount of outstanding Advances to an amount which, when added to the then
applicable Interest Holdback, equals the aggregate remaining Commitments of the
Extending Lenders, which aggregate remaining Commitments shall be deemed
thereafter to be the Credit Limit and the amount of the Loan.  Administrative Agent shall prepare a
replacement Schedule 1.1, showing the modified Commitments and Pro Rata Shares
of the Extending Lenders.  The Commitments
of the Non Extending Lenders will thereafter be deemed cancelled.


 


20

















2.15         PARTIAL RELEASE OF MAKAI SUBDIVISION.


 


At any time prior to the Maturity Date of the Loan,
Administrative Agent shall, at Borrower’s request, release from the lien of the
Mortgage Lot 1 and Lot 2 described on that certain subdivision map of Kapalua
Makai Subdivision 1 prepared by Warren S. Unemori - Engineering, Inc and dated
as of October 16, 2006 and revised on March 2, 2007, as delivered to
Administrative Agent; provided, however, that immediately prior to or
simultaneously with each such partial reconveyance all of the following
conditions shall be satisfied:


(a)           No Default shall exist under the Loan
Documents, or would exist with notice or passage of time, or both;


(b)           Administrative Agent shall have
received any and all sums then due and owing under the Loan Documents together
with all escrow, closing and recording costs, the costs of preparing and
delivering such partial release and the cost of any title insurance
endorsements required by Administrative Agent, including, without limitation, a
CLTA 116.3 and 111 endorsement;


(c)           Administrative Agent shall have
received evidence reasonably satisfactory to Administrative Agent that:  (i) the portion of the Property to be
reconveyed and the portion of the Property which shall remain encumbered by the
Mortgage are each legal parcels lawfully created in compliance with all
subdivision laws and ordinances and, at Borrower’s sole cost, Administrative
Agent shall have received any title insurance endorsements to that effect
requested by Administrative Agent; and (ii) that the portion of the Property
which shall remain encumbered by the Mortgage have the benefit of all
utilities, easements, public and/or private streets, covenants, conditions and
restrictions as may be necessary, in Administrative Agent’s reasonable
judgment, for the anticipated development and improvement thereof; and


(d)           Administrative Agent shall have
received evidence reasonably satisfactory to Administrative Agent that any tax,
bond or assessment which constitutes a lien against the Property has been
properly allocated between the portion of the Property to be reconveyed and the
portion of the Property which shall remain encumbered by the Mortgages.


Neither the acceptance of any payment nor the issuance
of any partial reconveyance by Administrative Agent shall affect Borrower’s
obligation to repay all amounts owing under the Loan Documents or under the
lien of the Mortgage on the remainder of the Property which is not reconveyed.


2.16         RESERVED.




2.17         LIMITATION ON BORROWER’S LIABILITY.


 


Except as hereinafter set forth, Administrative Agent’s
and Lenders’ recovery against Borrower under the Loan Documents, shall be limited
solely to the Collateral given to Administrative Agent and Lenders as security
for Borrower’s performance under the Loan Documents, and such recovery shall
not be a lien, or the basis of a claim of lien or levy of execution, against
the general assets of Borrower. Notwithstanding the foregoing, Borrower and the
general assets of Borrower shall be fully liable to Administrative Agent and
Lenders, to the same extent that Borrower would be liable absent the foregoing
limitation of this paragraph, for:


(a)           The Recourse Amount;


(b)           Upon the occurrence of any event
referred to in Sections 9.1(f), 9.1(g) or 9.1(k) hereof or upon the
breach of Section 7.15 of the Loan Agreement or Section 5.10 of
the Mortgage, the full amount of the Obligations; and


(c)           All losses, damages, liabilities,
claims, actions, judgments, court costs and legal and other reasonable expenses
(including, without limitation, attorneys’ fees and expenses) which Lender 


 


21

















may incur as a direct or indirect consequence of (i)
fraud or willful misrepresentation; (ii) physical waste of the Property; (iii)
failure of Borrower to pay any income or other taxes, assessments or other
charges which may create liens on all or any portion of the Property (to the
full extent of any such taxes, assessments or other charges); (iv) the amount
of any money or value of any property received by any shareholder of Borrower
as a distribution of earnings or income from the Property if such distribution
was prohibited under the terms of this Agreement (to the full extent of such
distribution); (v) any breach by Borrower of any covenant under Article 6
hereof, any representation or warranty of Borrower under such Article proving
to have been untrue when made, or the presence of any significant Hazardous
Materials in, on or about the Property which are discovered subsequent to the
Effective Date; (vi) misapplication or misappropriation of (x) proceeds paid
under any insurance policy by reason of damage, loss or destruction affecting
any portion of the Property, or (y) any proceeds or awards resulting from
condemnation of all or any part of the Property or any deed given in lieu
thereof; (vii) misapplication or misappropriation of rents received after
receipt by Borrower of any notice of Default, foreclosure under the Mortgage or
any other remedies by Administrative Agent and Lenders upon a Default by
Borrower; or (viii) Borrower’s breach of the covenants set forth in Section 5.5
of the Mortgage.


In addition, the limitations hereof shall not be
deemed to limit: (i) any right Administrative Agent or any Lender might
otherwise have to obtain injunctive relief against Borrower; (ii) any suit or
action or the reasonable attorneys’ fees and costs incurred in connection with
the preservation, enforcement or foreclosure of the liens, mortgages,
assignments and security interests now or at any time hereafter securing the
payment and performance of all sums and obligations under this Agreement or any
of the Loan Documents; or (iii) the collection of amounts which may become
owing or payable under or on account of insurance, condemnation awards or
damages for other public actions or surety bonds maintained or provided by
Borrower.


ARTICLE 3.  DISBURSEMENT


3.1           CONDITIONS PRECEDENT.


 


Administrative Agent’s and Lenders’ obligation to make
any Advance or take any other action under the Loan Documents shall be subject
at all times to satisfaction of each of the following conditions precedent:


(a)           There shall exist no Default or
Potential Default, as defined in this Agreement, or Default as defined in any
of the other Loan Documents or in the Other Related Documents; and


(b)           Administrative Agent shall have
received all Loan Documents, other documents, instruments, policies, and forms
of evidence or other materials requested by Administrative Agent or any Lender
under the terms of this Agreement or any of the other Loan Documents; and


(c)           With respect to the initial Advance
only, Administrative Agent shall have received, reviewed and approved in form
and substance satisfactory to Administrative Agent:  (i) reserved; (ii) an environmental
questionnaire and environmental site assessment with respect to the presence,
if any, of Hazardous Materials on the Property; (iii) copies of all
agreements which are material to the occupancy and operation of the Property;
(v) copies of all building permits and Permits required in connection with
the development of the Property including, without limitation, any
documentation relating to the entitlement of Kapalua Mauka; (vi) copies of
any initial study, negative declaration, mitigated negative declaration,
environmental impact report, notice of determination or notice of exemption
prepared, adopted, certified or filed by or with any Governmental Authority in
connection with the Property; (vii) an Appraisal of the Property; and (viii)
such financial and other information about the Borrower and the Property as the
Administrative Agent shall have requested in its sole discretion including,
without limitation, about any leases and tenants of the Property.


(d)           Administrative Agent shall have
received from each Lender such Lender’s Pro Rata Share of such disbursement;


(e)           The Administrative Agent shall have
received an Application for Advance;


 


22

















(f)            The Administrative Agent shall have
received such other approvals, opinions of counsel and documents as the
Administrative Agent may request in its reasonable discretion relating to the
Property, the Borrower, the Loan Documents and the transactions contemplated
thereby:


(g)           The representations and warranties
made by the Borrower in the Loan Documents shall be true and correct on and as
of the date such Advance is made, with the same effect as if made on and as of
such date (except to the extent that such representations and warranties relate
solely to an earlier date); and


(h)           No act, omission, change, occurrence
or event which has a Material Adverse Effect shall have occurred since the
Effective Date; and


(i)            Borrower shall provide, at Borrower’s
expense, an opinion of legal counsel in form and content satisfactory to
Administrative Agent to the effect that: 
(a) upon due authorization, execution and recordation or filing as may
be specified in the opinion, each of the Loan Documents and Other Related
Documents shall be legal, valid and binding instruments, enforceable against
the makers thereof in accordance with their respective terms; (b) Borrower and
Leasehold Mortgagor are duly formed and have all requisite authority to enter into
the Loan Documents and Other Related Documents; and (c) such other matters,
incident to the transactions contemplated hereby, as Administrative Agent may
reasonably request.


3.2           ACCOUNT, PLEDGE AND ASSIGNMENT, AND DISBURSEMENT
AUTHORIZATION.


 


The proceeds of the Loan, when qualified for
disbursement, shall be deposited into the Account or otherwise disbursed to or
for the benefit or account of Borrower under the terms of this Agreement; provided,
however, that any direct disbursements from the Loan which are made by
means of wire transfer, shall be subject to the provisions of Section 3.4.  Disbursements hereunder may be made by
Administrative Agent upon the written request of any person who has been
authorized by Borrower to request such disbursements until such time as written
notice of Borrower’s revocation of such authority is received by Administrative
Agent.


3.3           LOAN DISBURSEMENTS.


 


Subject to the conditions set forth in Section 3.1,
the proceeds of the Loan shall be disbursed in accordance with the terms and
conditions of the Loan Documents.  All
disbursements shall be applied by Borrower solely for the purposes permitted by
this Agreement.  Administrative Agent and
Lenders have no obligation to monitor or determine Borrower’s use or
application of the disbursements.


3.4           FUNDS TRANSFER DISBURSEMENTS.


 


Borrower hereby authorizes Administrative Agent to
disburse the proceeds of any Loan(s) made by each Lender or its affiliate
pursuant to the Loan Documents as requested by an authorized representative of
the Borrower to any of the accounts designated in that certain Exhibit entitled
Transfer Authorizer Designation. 
Borrower agrees to be bound by any transfer request: (i) authorized or
transmitted by Borrower; or, (ii) made in Borrower’s name and accepted by
Administrative Agent in good faith and in compliance with these transfer
instructions, even if not properly authorized by Borrower.  Borrower further agrees and acknowledges that
Administrative Agent may rely solely on any bank routing number or identifying
bank account number or name provided by Borrower to effect a wire or funds
transfer even if the information provided by Borrower identifies a different
bank or account holder than named by the Borrower.  Administrative Agent is not obligated or
required in any way to take any actions to detect errors in information
provided by Borrower.  If Administrative
Agent takes any actions in an attempt to detect errors in the transmission or
content of transfer or requests or takes any actions in an attempt to detect
unauthorized funds transfer requests, Borrower agrees that no matter how many
times Administrative Agent takes these actions Administrative Agent will not in
any situation be liable for failing to take or correctly perform these actions
in the future and such actions shall not become any part of the transfer
disbursement procedures authorized under this provision, the Loan Documents, or
any 


 


23

















agreement between Administrative Agent and
Borrower.   Borrower agrees to notify
Administrative Agent of any errors in the transfer of any funds or of any
unauthorized or improperly authorized transfer requests within 14 days after
Administrative Agent’s confirmation to Borrower of such transfer.  Administrative Agent will, in its sole
discretion, determine the funds transfer system and the means by which each
transfer will be made.  Administrative
Agent may delay or refuse to accept a funds transfer request if the transfer would:
(i) violate the terms of this authorization (ii) require use of a bank
unacceptable to Administrative Agent or prohibited by government authority;
(iii) cause Administrative Agent to violate any Federal Reserve or other
regulatory risk control program or guideline, or (iv) otherwise cause
Administrative Agent to violate any applicable law or regulation.  Administrative Agent shall not be liable to
Borrower or any other parties for (i) errors, acts or failures to act of
others, including other entities, banks, communications carriers or clearinghouses,
through which Borrower’s transfers may be made or information received or
transmitted, and no such entity shall be deemed an agent of the Administrative
Agent, (ii) any loss, liability or delay caused by fires, earthquakes, wars,
civil disturbances, power surges or failures, acts of government, labor
disputes, failures in communications networks, legal constraints or other
events beyond Administrative Agent’s control, or (iii) any special,
consequential, indirect or punitive damages, whether or not (a) any claim for
these damages is based on tort or contract or (b) Administrative Agent or
Borrower knew or should have known the likelihood of these damages in any
situation.  Administrative Agent makes no
representations or warranties other than those expressly made in this
Agreement.


ARTICLE 4.  INSURANCE


Borrower shall, while any obligation of Borrower or
Leasehold Mortgagor under any Loan Document remains outstanding, maintain at
Borrower’s sole expense, with licensed insurers approved by Administrative
Agent, the following policies of insurance in form and substance reasonably
satisfactory to Administrative Agent, provided that Borrower shall have fifteen
(15) days after written notice that Borrower has not complied with its
obligations under this Article 4 to so comply before a Default shall be
deemed to have occurred hereunder. 
Capitalized terms used in this Article shall have the same meaning as
such terms are commonly and presently defined in the insurance industry.


4.1           TITLE INSURANCE.


 


A Title Policy, together
with any endorsements which Administrative Agent may require, insuring
Administrative Agent, for the benefit of Lenders, in the principal amount of
the Loan, of the validity and the priority of the lien of the Mortgage upon the
Property, subject only to matters approved by Administrative Agent in
writing.  During the term of the Loan,
Borrower shall deliver to Administrative Agent, within ten (10) days of
Administrative Agent’s written request, such other endorsements to the Title
Policy as Administrative Agent may reasonably require with respect to the
Property.


4.2           PROPERTY INSURANCE.


 


An All Risk/Special Form
Property Insurance policy, including without limitation, theft coverage and
such other coverages and endorsements as Administrative Agent may require,
insuring Administrative Agent, for the benefit of Lenders against damage to the
Property in an amount not less than 100% of the full replacement cost.   Such coverage should adequately insure any
and all Loan collateral, whether such collateral is onsite, stored offsite or
otherwise.   Administrative Agent, for
the benefit of Lenders, shall be named on the policy as Mortgagee and named
under a Lender’s Loss Payable Endorsement (form #438BFU or equivalent).


4.3           FLOOD HAZARD INSURANCE.


 


A policy of flood insurance,
as required by applicable governmental regulations, or as deemed necessary by
Administrative Agent, in an amount required by Administrative Agent, but in no
event less than the amount sufficient to meet the requirements of applicable
law and governmental regulation.


 


24




















 


4.4           LIABILITY INSURANCE.


 


A policy of Commercial
General Liability insurance on an occurrence basis, with coverages and limits
as reasonably required by Administrative Agent, insuring against liability for
injury and/or death to any person and/or damage to any property occurring on
the Property.


4.5           OTHER COVERAGE.


 


Borrower shall provide to Administrative Agent
evidence of such other reasonable insurance in such reasonable amounts as
Administrative Agent may from time to time request against such other insurable
hazards which at the time are commonly insured against for property similar to
the subject Property located in or around the region in which the subject
Property is located.  Such coverage
requirements may include but are not limited to coverage for earthquake, acts
of terrorism, business income, delayed business income, rental loss, sink hole,
soft costs, tenant improvement or environmental.


4.6           GENERAL.


 


Borrower shall provide to
Administrative Agent insurance certificates or other evidence of coverage in
form acceptable to Administrative Agent, with coverage amounts, deductibles,
limits and retentions as reasonably required by Administrative Agent.  All insurance policies shall provide that the
coverage shall not be cancelable or materially changed without 10 days prior
written notice to Administrative Agent of any cancellation for nonpayment of
premiums, and not less than 30 days prior written notice to Administrative
Agent of any other cancellation or any modification (including a reduction in coverage).  Administrative Agent, for the benefit of
Lenders shall be named under a Lender’s Loss Payable Endorsement (form #438BFU
or equivalent) on all insurance policies which Borrower actually maintains with
respect to the Property.  All insurance
policies shall be issued and maintained by insurers approved to do business in
the state in which the Property is located and must have an A.M. Best Company
financial rating and policyholder surplus acceptable to Administrative Agent.  Notwithstanding anything to the contrary herein but
without limiting or affecting the requirements of this Article 4,
Administrative Agent and Lenders may not make the granting of the Loan
contingent upon the procuring of any insurance required hereunder or under any
of the other Loan Documents with an insurance company designated by
Administrative Agent or any Lender.


ARTICLE 5.  REPRESENTATIONS AND
WARRANTIES


As a material inducement to Lenders’ entry into this
Agreement, Borrower represents and warrants to Administrative Agent and each
Lender as of the Effective Date and continuing thereafter that:


5.1           AUTHORITY/ENFORCEABILITY.


 


Borrower is in compliance in all material respects
with all Requirements of Law applicable to its organization, existence and
transaction of business and has all necessary rights and powers to own, develop
and operate the Property as contemplated by the Loan Documents.


5.2           BINDING OBLIGATIONS.


 


Borrower is authorized to execute, deliver and perform
its obligations under the Loan Documents, and such obligations shall be valid
and binding obligations of Borrower.


5.3           FORMATION AND ORGANIZATIONAL DOCUMENTS.


 


Borrower has delivered to Administrative Agent all
formation and organizational documents of Borrower, of the partners, joint
venturers or members of Borrower, if any, and of all guarantors of the Loan, if
any, and all such formation and organizational documents remain in full force
and effect and have not been amended or modified since they were delivered to
Lender.  Borrower shall immediately
provide Lender with copies of any amendments or modifications of the formation
or organizational documents.


 


25

















 


5.4           NO VIOLATION.


 


Borrower’s execution, delivery, and performance under
the Loan Documents do not: (a) require any consent or approval not
heretofore obtained under any partnership agreement, operating agreement,
articles of incorporation, bylaws or other document; (b) violate any
Requirements of Law applicable to the Borrower or the Property; or (c) conflict
with, or constitute a breach or default or permit the acceleration of
obligations under any material agreement, contract, lease, or other document by
which the Borrower is or the Property are bound or regulated.


5.5           COMPLIANCE WITH LAWS.


 


Borrower has, and at all times shall have obtained,
all permits, licenses, exemptions, and approvals necessary to construct,
occupy, operate and market the Property, and shall maintain compliance in all
material respects with all Requirements of Law applicable to the Property and
all other applicable statutes, laws, regulations and ordinances necessary for
the transaction of its business.  The
Property is a legal parcel lawfully created in full compliance with all
subdivision laws and ordinances.


5.6           LITIGATION.


 


Except as disclosed on Schedule 5.6 attached
hereto, there are no claims, actions, suits, or proceedings pending, or to
Borrower’s knowledge threatened, against Borrower or affecting the Property
which could reasonably be expected to result in a Material Adverse Effect..


5.7           FINANCIAL CONDITION.


 


All financial statements and information heretofore
and hereafter delivered to Administrative Agent by Borrower, including, without
limitation, information relating to the financial condition of Borrower, the
Property, the partners, joint venturers or members of Borrower, and/or
Leasehold Mortgagor, fairly and accurately represent the financial condition of
the subject thereof and have been prepared (except as noted therein) in
accordance with generally accepted accounting principles consistently applied
(except, in the case of unaudited financial statements, for the lack of
footnotes and year-end audit adjustments). 
Borrower acknowledges and agrees that Administrative Agent and Lenders
may request and obtain additional information from third parties regarding any
of the above, including, without limitation, credit reports.


5.8           NO MATERIAL ADVERSE CHANGE.


 


There has been no material adverse change in the
financial condition of Borrower and/or Leasehold Mortgagor since the dates of
the latest financial statements furnished to Administrative Agent and, except
as otherwise disclosed to Administrative Agent in writing or in reports filed
with the Securities and Exchange Commission, Borrower has not entered into any
material transaction which is not disclosed in such financial statements.


5.9           ACCURACY.


 


All reports, documents, instruments, information and
forms of evidence delivered to Administrative Agent concerning the Loan or
security for the Loan or required by the Loan Documents are accurate, correct
and sufficiently complete in all material respects as of the date furnished to
give Administrative Agent and Lenders true and accurate knowledge of their
subject matter, and do not contain any material misrepresentation or omission.


5.10         TAX LIABILITY.


 


Except as disclosed on Schedule 5.10, Borrower
has filed all required federal, state, county and municipal tax returns and has
paid all taxes and assessments owed and payable, and, except as disclosed on


 


26

















 


Schedule 5.10, Borrower has no knowledge of any basis for any
additional payment with respect to any such taxes and assessments.


5.11         TITLE TO ASSETS; NO LIENS.


 


Borrower has good and indefeasible title to the
Property, free and clear of all liens and encumbrances except Permitted Liens.


5.12         MANAGEMENT AGREEMENTS.


 


Borrower is not a party or subject to any management
agreement with respect to the Property.


5.13         UTILITIES.


 


All utility services, including, without limitation,
water, sewage, electrical and telephone, necessary for the development and
occupancy of the Property are available at or within the boundaries of the
Property.


5.14         COMPLIANCE.


 


Borrower is familiar with and in compliance with all
Requirements of Law and Permits for the development and operation of the
Property and will conform to and comply with all Requirements of Law in all
material respects.


5.15         AMERICANS WITH DISABILITIES ACT COMPLIANCE.


 


Any improvements on the Property have been designed
and shall be constructed and completed, and thereafter maintained, in strict
accordance and full compliance with all of the requirements of the ADA.  Borrower shall be responsible for all ADA
compliance costs.


5.16         BUSINESS LOAN.


 


The Loan is a business loan transaction in the stated
amount solely for the purpose of carrying on the business of Borrower and none
of the proceeds of the Loan will be used for the personal or family purposes of
the Borrower.


5.17         TAX SHELTER REGULATIONS.


 


Neither the Borrower, Leasehold Mortgagor, nor any
Subsidiary of any of the foregoing intends to treat the Loan or the
transactions contemplated by this Agreement and the other Loan Documents as
being a “reportable transaction” (within the meaning of Treasury Regulation
Section 1.6011-4).  If the Borrower, or
any other party to the Loan determines to take any action inconsistent with
such intention, the Borrower will promptly notify Administrative Agent and each
Lender thereof.  If the Borrower so
notifies the Administrative Agent and each Lender, the Borrower acknowledges
that each Lender may treat its Loan as part of a transaction that is subject to
Treasury Regulation Section 301.6112-1, and Lender will maintain the lists and
other records, including the identity of the applicable party to the Loan as
required by such Treasury Regulation.


5.18         PROPERTY DOCUMENTS.


 


Borrower has furnished Administrative Agent with a
true and complete copy of all contracts, leases, licenses and other agreements
and documents (collectively, “Property Documents”) material to the operation of
the Property.


 


27

















 


ARTICLE 6.  HAZARDOUS MATERIALS


6.1           SPECIAL REPRESENTATIONS AND WARRANTIES.


 


Without in any way limiting the other representations
and warranties set forth in this Agreement, and after reasonable investigation
and inquiry, Borrower hereby specially represents and warrants to the best of
Borrower’s knowledge as of the date of this Agreement as follows:


(a)           Hazardous
Materials.  Except as set forth in those certain reports listed on Schedule 6.1
attached hereto (the “Site Assessment”) , the Property is not and has
not been a site for the use, generation, manufacture, storage, treatment,
release, threatened release, discharge, disposal, transportation or presence of
any oil, flammable explosives, asbestos, urea formaldehyde insulation,
radioactive materials, hazardous wastes, toxic or contaminated substances or
similar materials, including, without limitation, any substances which are “hazardous
substances,” “hazardous wastes,” “hazardous materials,” “toxic substances,” “wastes,”
“regulated substances,” “industrial solid wastes,” or “pollutants” under the
Hazardous Materials Laws, as described below, and/or other applicable
environmental laws, ordinances and regulations (collectively, the “Hazardous
Materials”).  “Hazardous Materials”
shall not include commercially reasonable amounts of such materials used in the
ordinary course of operation and maintenance of the Property which are used and
stored in accordance with all applicable environmental laws, ordinances and
regulations.


(b)           Hazardous
Materials Laws.  The Property is in compliance with all laws,
ordinances and regulations relating to Hazardous Materials (“Hazardous
Materials Laws”), including, without limitation:  the Clean Air Act, as amended, 42 U.S.C.
Section 7401 et  seq.; the Federal Water Pollution Control Act, as
amended, 33 U.S.C. Section 1251 et  seq.; the Resource
Conservation and Recovery Act of 1976, as amended, 42 U.S.C. Section 6901 et
seq.; the Comprehensive Environment Response, Compensation and Liability
Act of 1980, as amended (including the Superfund Amendments and Reauthorization
Act of 1986, “CERCLA”), 42 U.S.C. Section 9601 et  seq.;
the Toxic Substances Control Act, as amended, 15 U.S.C. Section 2601 et  seq.;
the Occupational Safety and Health Act, as amended, 29 U.S.C. Section 651, the
Emergency Planning and Community Right-to-Know Act of 1986, 42 U.S.C. Section
11001 et  seq.; the Mine Safety and Health Act of 1977, as
amended, 30 U.S.C. Section 801 et  seq.; the Safe Drinking Water
Act, as amended, 42 U.S.C. Section 300f et  seq.; the Hawaii
Occupational Safety and Health Law, Haw. Rev. Stat. Chapter 392, as amended;
Haw. Rev. Stat. Chapters 128D (Environmental Response), 149A (Pesticides), 195D
(Conservation), 340A (Solid Waste), 340E (Safe Drinking Water), 342B (Air
Pollution Control), 342D (Water Pollution), 342F (Noise Pollution), 342H (Solid
Waste Pollution), 342J (Hazardous Waste), 342L (Underground Storage Tanks), and
342P (Asbestos), all as amended; and all comparable state and local laws, laws
of other jurisdictions or orders and regulations.


(c)           Hazardous
Materials Claims.  There are no claims or actions (“Hazardous
Materials Claims”) pending or threatened against Borrower, the Property by
any governmental entity or agency or by any other person or entity relating to
Hazardous Materials or pursuant to the Hazardous Materials Laws.


6.2           HAZARDOUS MATERIALS COVENANTS.


 


Borrower agrees as follows:


(a)           No
Hazardous Activities.  Borrower shall not cause or permit the
Property to be used as a site for the use, generation, manufacture, storage,
treatment, release, discharge, disposal, transportation or presence of any
Hazardous Materials.


(b)           Compliance.  Borrower
shall comply and cause the Property to comply in all material respects with all
Hazardous Materials Laws.


(c)           Notices.  Borrower
shall immediately notify Administrative Agent in writing of:  (i) the discovery of any Hazardous
Materials on, under or about the Property; (ii) any knowledge by 


 


28

















 


Borrower that the Property does not comply with any Hazardous Materials
Laws; and (iii) any Hazardous Materials Claims.


(d)           Remedial
Action.  In response to the presence of any Hazardous Materials
on, under or about the Property, Borrower shall immediately take, at Borrower’s
sole expense, all remedial action required by any Hazardous Materials Laws or
any judgment, consent decree, settlement or compromise in respect to any
Hazardous Materials Claims, not later than fifteen (15) days after written
notice from Administrative Agent that it is in default of any such
obligation..  Without limitation of the
foregoing sentence, Borrower shall, subject to all applicable Requirements of
Law including, without limitation Hazardous Materials Laws, within
one hundred eighty (180) days after the Effective Date, exercise reasonable
best efforts to complete the actions specifically recommended in the Findings,
Opinions, Conclusions, and Recommendations of 
the Site Assessment (Section 9.0) with respect to the Recognized
Environmental Conditions identified therein at the Property (excluding such
Recognized Environmental Conditions at the portions of the Property subject to
being released pursuant to Section 2.15 above); provided, however, that this
obligation shall not include subsurface investigation or soil sampling unless
required under Hazardous Materials Laws.


6.3           INSPECTION BY ADMINISTRATIVE AGENT.


 


Upon reasonable prior notice to Borrower and subject
to the rights of tenants, Administrative Agent, its employees and agents, may
from time to time (whether before or after the commencement of a nonjudicial or
judicial foreclosure proceeding) enter and inspect the Property for the purpose
of determining the existence, location, nature and magnitude of any past or
present release or threatened release of any Hazardous Materials into, onto,
beneath or from the Property.


6.4           HAZARDOUS MATERIALS INDEMNITY.


 


BORROWER HEREBY AGREES TO DEFEND,
INDEMNIFY AND HOLD HARMLESS ADMINISTRATIVE AGENT AND EACH LENDER, AND THEIR
RESPECTIVE DIRECTORS, OFFICERS, EMPLOYEES, AGENTS, SUCCESSORS AND ASSIGNS FROM
AND AGAINST ANY AND ALL LOSSES, DAMAGES, LIABILITIES, CLAIMS, ACTIONS,
JUDGMENTS, COURT COSTS AND LEGAL OR OTHER EXPENSES (INCLUDING, WITHOUT
LIMITATION, ATTORNEYS’ FEES AND EXPENSES) WHICH ADMINISTRATIVE AGENT AND/OR ANY
LENDER MAY INCUR AS A DIRECT OR INDIRECT CONSEQUENCE OF THE USE, GENERATION,
MANUFACTURE, STORAGE, DISPOSAL, THREATENED DISPOSAL, TRANSPORTATION OR PRESENCE
OF HAZARDOUS MATERIALS IN, ON, UNDER OR ABOUT THE PROPERTY OR
IMPROVEMENTS.  BORROWER SHALL IMMEDIATELY
PAY TO ADMINISTRATIVE AGENT AND/OR ANY LENDER, UPON DEMAND, ANY AMOUNTS OWING
UNDER THIS INDEMNITY, TOGETHER WITH INTEREST FROM THE DATE THE INDEBTEDNESS
ARISES UNTIL PAID AT THE RATE OF INTEREST APPLICABLE TO THE PRINCIPAL BALANCE
OF THE LOAN.  BORROWER’S DUTY AND
OBLIGATIONS TO DEFEND, INDEMNIFY AND HOLD HARMLESS ADMINISTRATIVE AGENT AND
EACH LENDER SHALL SURVIVE THE CANCELLATION OF THE NOTES AND THE RELEASE,
RECONVEYANCE OR PARTIAL RECONVEYANCE OF THE MORTGAGE.  NOTWITHSTANDING ANYTHING TO THE CONTRARY
CONTAINED HEREIN, BORROWER SHALL NOT BE LIABLE FOR ANY HAZARDOUS MATERIALS
PLACED IN, UNDER, OVER, FROM OR AFFECTING THE PROPERTY AFTER THE LATER OF SUCH
TIME AS BORROWER IS NO LONGER EITHER THE OWNER OF THE PROPERTY OR IN POSSESSION
OF THE PROPERTY; PROVIDED, HOWEVER, THAT (I) THE MIGRATION OF ANY HAZARDOUS
MATERIALS PLACED IN, UNDER, OVER, FROM OR AFFECTING THE PROPERTY, WHICH
MATERIALS WERE PRESENT PRIOR TO THE LATER OF SUCH TIME WHEN BORROWER IS NO
LONGER EITHER THE OWNER OF THE PROPERTY OR IN POSSESSION OF THE PROPERTY SHALL
REMAIN THE LIABILITY OF BORROWER; AND (II) BORROWER SHALL HAVE THE BURDEN OF
PROVING THAT SUCH ENVIRONMENTAL CONDITION OCCURRED SUBSEQUENT TO BORROWER’S
OWNERSHIP OR POSSESSION OF THE PROPERTY, AS THE CASE MAY BE.


 


29

















 


6.5           LEGAL EFFECT OF SECTION.


 


It is expressly understood that Borrower’s duty to
indemnify Administrative Agent and Lenders hereunder shall survive:  (i) any judicial or non-judicial
foreclosure under the Mortgage, or transfer of the Property in lieu thereof;
(ii) the release and reconveyance or cancellation of the Mortgage; and
(iii) the satisfaction of all of Borrower’s Obligations under the Loan
Documents.


ARTICLE 7.  COVENANTS OF BORROWER


7.1           EXPENSES.


 


Borrower shall pay to Administrative Agent, within
fifteen (15) days of written demand by Administrative Agent, all reasonable
costs and expenses incurred by Administrative Agent in connection with:  (a) the preparation of this Agreement,
all other Loan Documents and Other Related Documents contemplated hereby;
(b) the administration of this Agreement, the other Loan Documents and
Other Related Documents for the term of the Loan; and (c) the enforcement
or satisfaction by Administrative Agent or Lenders of any of Borrower’s
obligations under this Agreement, the other Loan Documents or the Other Related
Documents.  For all purposes of this
Agreement, Administrative Agent’s and Lenders’ costs and expenses shall
include, without limitation, all reasonable appraisal fees, cost engineering
and inspection fees, legal fees and expenses, accounting fees, environmental
consultant fees, auditor fees, UCC filing fees and/or UCC vendor fees, and the
cost to Lenders of any title insurance premiums, title surveys, reconveyance
and notary fees.  Borrower recognizes and
agrees that formal written Appraisals of the Property by a licensed independent
appraiser may be required by Administrative Agent’s or any Lender’s internal
procedures and/or federal regulatory reporting requirements on an annual and/or
specialized basis and that Administrative Agent or Lenders’ may, at their
option, require inspection of the Property by an independent supervising
architect and/or cost engineering specialist at least semi-annually.  If any of the services described above are
provided by an employee of Administrative Agent, Administrative Agent’s costs
and expenses for such services shall be calculated in accordance with Administrative
Agent’s standard charge for such services.


7.2           ERISA COMPLIANCE.


 


Borrower shall at all times comply with the provisions
of ERISA with respect to any retirement or other employee benefit plan to which
it is a party as employer, and as soon as possible after Borrower knows, or has
reason to know, that any Reportable Event (as defined in ERISA) with respect to
any such plan of Borrower has occurred, it shall furnish to Administrative
Agent a written statement, within fifteen days after written request therefor
from Administrative Agent,, setting forth details as to such Reportable Event
and the action, if any, which Borrower proposes to take with respect thereto,
together with a copy of the notice of such Reportable Event furnished to the
Pension Benefit Guaranty Corporation.


7.3           LEASING.


 


Borrower shall use its commercially reasonable efforts
to maintain all leasable commercial space on the Property leased at no less
than fair market rental rates, except for space utilized by the Borrower and
its Affiliates; provided, however, that Borrower shall have fifteen (15) days
after written notice from Administrative Agent to cure any default under this
section (i.e., to commence commercially reasonable efforts to lease space
and/or unwind or amend the terms of any lease to provide for fair market rental
rates).


7.4           APPROVAL OF LEASES.


 


All leases (and lease terminations, modifications or
amendments) of all or any material portion of the Property (each, a “Major
Lease”) shall:  (a) be for not less
than fair market rental rates; and (b) include estoppel, subordination,
attornment and mortgagee protection provisions satisfactory to Administrative
Agent (any such Major Lease which complies with the foregoing clauses (a) and
(b), and each other lease (and lease termination, modification or amendment) of
the Property which is not a Major Lease, a herein 


 


30

















 


referred to as a “Permitted Lease”): provided,
however, that Borrower shall have fifteen (15) days after written notice from
Administrative Agent to cure any default under this section (i.e., to unwind or
amend the terms of any Major Lease to provide for fair market rental rates
and/or estoppel, subordination, attornment and mortgagee protection provisions
satisfactory to Administrative Agent)..


7.5           SUBDIVISION MAPS.


 


Prior to recording any final map, plat, parcel map,
lot line adjustment or other subdivision map of any kind covering any portion
of the Property (collectively, “Subdivision Map”), Borrower shall submit
such Subdivision Map to Administrative Agent for Administrative Agent’s review
and approval, which approval shall not be unreasonably withheld.  Within ten (10) Business Days after
Administrative Agent’s receipt of such Subdivision Map, Administrative Agent
shall provide Borrower written notice if Administrative Agent disapproves of
said Subdivision Map.  Within five (5)
Business Days after Administrative Agent’s request, Borrower shall execute,
acknowledge and deliver to Administrative Agent such amendments to the Loan
Documents as Administrative Agent may reasonably require to reflect the change
in the legal description of the Property resulting from the recordation of any
Subdivision Map.  In connection with and
promptly after the recordation of any amendment or other modification to the
Mortgage recorded in connection with such amendments, Borrower shall deliver to
Administrative Agent, for the benefit of Lenders, at Borrower’s sole expense, a
title endorsement to the Title Policy in form and substance reasonably
satisfactory to Administrative Agent insuring the continued first priority lien
of the Mortgage.  Subject to the
execution and delivery by Borrower of any documents required under this
Section, Administrative Agent, on behalf of Lenders, shall, if required by
applicable law, sign any Subdivision Map approved by Administrative Agent
pursuant to this Section.


7.6           RESERVED.


 


7.7           FURTHER ASSURANCES.


 


Upon Administrative Agent’s request and at Borrower’s
sole cost and expense, Borrower shall, within fifteen (15) days of written
request therefor by Administrative Agent, execute, acknowledge and deliver any
other instruments and perform any other acts reasonably necessary or proper, as
determined by Administrative Agent in its reasonable discretion, to carry out
the purposes of this Agreement and the other Loan Documents or to perfect and
preserve any Liens created by the Loan Documents.


7.8           ASSIGNMENT.


 


Without the prior written consent of all of the
Lenders, Borrower shall not assign Borrower’s interest under any of the Loan
Documents, or in any monies due or to become due thereunder, and any assignment
without such consent shall be void.  In
this regard, Borrower acknowledges that Lenders would not make this Loan except
in reliance on Borrower’s expertise, reputation, prior experience in developing
and constructing commercial real property, Lenders’ knowledge of Borrower, and
Lenders’ understanding that this Agreement is more in the nature of an
agreement involving personal services than a standard loan where Lenders would
rely on security which already exists.


7.9           RESERVED.


 


7.10         REQUIREMENTS OF LAW.


 


Borrower shall comply with all Requirements of Law in
all material respects and shall use commercially reasonable and good faith
efforts to cause other persons or entities to comply with same in a timely
manner.


7.11         LIENS AND STOP NOTICES.


 


If a
claim of Lien, other than a Permitted Lien, is recorded which affects the
Property or a bonded stop notice is served upon Administrative Agent or any
Lender, Borrower shall, within twenty (20) calendar 


 


31

















 


days of
such recording or service or within five (5) calendar days of Administrative
Agent’s demand, whichever occurs first: 
(a) pay and discharge the claim of Lien or bonded stop notice; (b)
effect the release thereof by recording or delivering to Administrative Agent a
surety bond in sufficient form and amount; or (c) provide Administrative Agent
with other assurances which Administrative Agent deems, in its reasonable
discretion, to be satisfactory for the payment of such claim of Lien or bonded
stop notice and for the full and continuous protection of Administrative Agent
and Lenders from the effect of such Lien or bonded stop notice.


7.12         FINANCIAL COVENANTS.


 


(a)           Net Worth.  Borrower shall, as of the end of each fiscal
quarter of Borrower, maintain a Net Worth of not less than $85,000,000.00.  As used herein, “Net Worth” shall mean, (a)
the sum of the (i) par value (or value stated on the books of the corporation)
of the capital stock (but excluding treasury stock and capital stock subscribed
and unissued) of the Borrower and its Subsidiaries plus (ii) the amount of
paid-in capital and retained earnings of the Borrower and its Subsidiaries, in
each case as such amounts would be shown on a consolidated balance sheet of the
Borrower and its Subsidiaries prepared in accordance with GAAP minus
(ii) to the extent included in clause (a), all amounts properly attributable to
minority interests, if any, in the stock and surplus of Subsidiaries.


(b)           Liquidity.  Borrower shall maintain, as of the end of
each calendar quarter, Liquidity of not less than $10,000,000.  As used herein, “Liquidity” shall mean the
sum of (i) cash, (ii) cash equivalents, (iii) publicly traded and publicly
quoted marketable securities acceptable to Administrative Agent in its
reasonable discretion, (iv) undisbursed commitment under secured lines of
credit available to Borrower including, without limitation, under this Loan,
and (v) the amount, if any, not to exceed $2,000,000, by which accounts
receivable of the Borrower exceed accounts payable of the Borrower, net, in
connection with any of the foregoing, of any encumbrance, setoff or claim and minus
any unsecured Indebtedness of Borrower.


(c)           Indebtedness.  Borrower shall not permit at any time (i)
total aggregate Indebtedness of the Borrower and its Subsidiaries on a
consolidated basis in accordance with GAAP (including the Indebtedness
described in clauses (ii) and (iii) below) to exceed $300,000,000.00, (ii)
total aggregate Indebtedness of the Borrower and its Subsidiaries on a
consolidated basis in accordance with GAAP relating to the acquisition,
development and operation of any specific real property development project to
exceed $150,000,000.00 and (iii) total aggregate Indebtedness of the Borrower
and its Subsidiaries on a consolidated basis not relating to the
acquisition, development and operation of any specific real property
development project to exceed $150,000,000.00.


(d)           Interest Coverage Ratio.  Borrower shall not permit the ratio of (i)
net income of the Borrower plus interest expense and taxes of Borrower to (ii)
interest expense of Borrower, in each case calculated in accordance with GAAP
as of the end of each fiscal year for the fiscal year then ending, to be less
than 1.50 to 1.00.


7.13         SPECIAL COVENANTS.  Without
the prior written consent of Administrative Agent, which consent shall not be
unreasonably withheld or delayed, Borrower shall not, and shall not permit
Leasehold Mortgagor, to (a) enter into, amend in any material respect (provided
that Borrower shall provide Administrative Agent a copy of any amendments,
whether or not material) or terminate any material agreement providing for the
development, management, or operation of the Property (approval of any such
other material agreement not to be unreasonably withheld by Administrative
Agent); and (b) engage in any transaction with any Affiliate of Borrower or
Leasehold Mortgagor on other than fair market, arms’-length terms and conditions.


 


7.14         POST-CLOSING DELIVERIES.  Without
limiting any other provision of this Agreement, the Borrower shall obtain and
deliver to Administrative Agent, from such from tenants under leases of the
Property as Administrative Agent requests and not later than the date which is
sixty (60) days after the Effective Date (as such date may be extended in
writing by the Administrative Agent in its sole and 


 


 


32

















 


absolute discretion), subordination, non-disturbance and attornment
agreements and tenant estoppels in form and substance reasonably satisfactory
to the Administrative Agent.


 


7.15         WATER DELIVERY AGREEMENT.  Borrower
shall, and shall cause, Leasehold Mortgagor, Maui Pineapple Company, Ltd., a
Hawaii corporation, and each of Borrower’s Affiliates, as necessary,  to fully comply with the terms and provisions
of, and to fully perform any and all obligations under and as required by, the
Water Delivery Agreement and the Collateral Assignment of Water Delivery
Agreement.   Without limitation of any
other provision of the Loan Documents, this agreement shall survive any
judicial or non-judicial foreclosure under the Mortgage, or transfer of the
Property in lieu thereof or the release and reconveyance or cancellation of the
Mortgage.


 


ARTICLE 8.  REPORTING COVENANTS


8.1           FINANCIAL INFORMATION.


 


Borrower shall deliver to the Administrative Agent, in
form and detail reasonably satisfactory to the Administrative Agent:


(a)           as soon as available, but in any
event within 90 days after the end of each fiscal year of the Borrower
(commencing with the fiscal year ended December 31, 2007), a consolidated
balance sheet of the Borrower and its Subsidiaries as at the end of such fiscal
year, and the related consolidated statements of income or operations,
shareholders’ equity and cash flows for such fiscal year, setting forth in each
case in comparative form the figures for the previous fiscal year, all in
reasonable detail and prepared in accordance with GAAP, audited and accompanied
by a report and opinion of an independent certified public accountant of
nationally recognized standing reasonably acceptable to the Administrative
Agent, which report and opinion (i) shall be prepared in accordance with
generally accepted auditing standards, (ii) shall not be subject to any “going
concern” or like qualification or exception or any qualification or exception
as to the scope of such audit, and (iii) shall include in the footnotes thereto
information regarding any Default that has occurred and is continuing,
including the nature and status of such Default, that such independent
certified public accountants obtained knowledge of during the course of their
examination; and


(b)           as soon as available, but in any
event within 60 days after the end of each of the first three fiscal quarters
of each fiscal year of the Borrower (commencing with the fiscal quarter ending
September 30, 2007), a consolidated balance sheet of the Borrower and its
Subsidiaries as at the end of such fiscal quarter, and the related consolidated
statements of income or operations, shareholders’ equity and cash flows for
such fiscal quarter and for the portion of the Borrower’s fiscal year then
ended, setting forth in each case in comparative form the figures for the corresponding
fiscal quarter of the previous fiscal year and the corresponding portion of the
previous fiscal year, all in reasonable detail, certified by the chief
executive officer, chief financial officer, treasurer or controller of the
Borrower as fairly presenting the financial condition, results of operations,
shareholders’ equity and cash flows of the Borrower and its Subsidiaries in
accordance with GAAP, subject only to normal year-end audit adjustments and the
absence of footnotes.


(c)           Within thirty (30) days of written
request by Administrative Agent, any other financial information including,
without limitation, quarterly financial statements, annual financial
statements, cash flow projections and quarterly operating statements requested
by Administrative Agent for the Borrower or any of its Subsidiaries.


Except as otherwise agreed to by Administrative Agent,
all such financial information shall be prepared in accordance with GAAP
consistently applied.


8.2           CERTIFICATES; OTHER INFORMATION.


 


Borrower shall deliver to the Administrative Agent, in
form and detail satisfactory to the Administrative Agent:


 


33

















 


(a)           concurrently with the delivery of the
financial statements referred to in Sections 8.1 (commencing with the delivery
of the financial statements for the fiscal quarter ended on or around September
30, 2007) and in any event within the time period specified therein, a duly
completed Compliance Certificate signed by the chief executive officer, chief financial
officer, treasurer or controller of the Borrower;


(b)           promptly after any request by the
Administrative Agent or any request by a Lender made through the Administrative
Agent, copies of any detailed audit reports, management letters or
recommendations submitted to the board of directors (or the audit committee of
the board of directors) of the Borrower by independent accountants in
connection with the accounts or books of the Borrower or any Subsidiary, or any
audit of any of them;


(c)           promptly after the same are
available, copies of each annual report, proxy or financial statement or other
report or communication sent to the stockholders of the Borrower, and copies of
all annual, regular, periodic and special reports and registration statements
which the Borrower may file or be required to file with the SEC under Section
13 or 15(d) of the Securities Exchange Act of 1934, and not otherwise required
to be delivered to the Administrative Agent pursuant hereto; and


(d)           promptly, such additional information
regarding the business, financial or corporate affairs of the Borrower or any
Subsidiary, or compliance with the terms of the Loan Documents, as the
Administrative Agent or any Lender acting through the Administrative Agent may
from time to time reasonably request.


8.3           BOOKS AND RECORDS.


 


Borrower shall maintain complete books of account and
other records for the Property and for disbursement and use of the proceeds of
the Loan, and the same shall be available for inspection and copying by
Administrative Agent and each Lender upon reasonable prior notice.


8.4           REPORTS.


 


Within ten (10) days of Administrative Agent’s
request, Borrower shall deliver to Administrative Agent monthly inventory
reports, marketing and sales schedules and reports, marketing and sales
information and/or leasing information, with respect to all real property
projects of Borrower and all Subsidiaries and Affiliates of Borrower relating
to the Property, all in form and substance acceptable to Administrative Agent.


8.5           LEASING REPORTS.


 


Borrower shall deliver to Administrative Agent quarterly rent rolls, leasing
schedules and reports, operating statements and/or such other leasing
information as Administrative Agent shall reasonably request with respect to
the Property, each in form and substance reasonably satisfactory to
Administrative Agent.


8.6           KNOWLEDGE OF DEFAULT; ETC.


 


Borrower shall promptly, upon obtaining knowledge
thereof, report in writing to Administrative Agent the occurrence of any
Default or Potential Default.  In the
case of any Potential Default, such notice shall include, as applicable, the
affirmative steps which Borrower has taken or intends to take during the
applicable cure period in order to avoid the occurrence of a Default with
respect to the subject event, circumstance or condition.


8.7           LITIGATION, ARBITRATION OR GOVERNMENT
INVESTIGATION.


 


Borrower shall promptly, upon obtaining knowledge
thereof, report in writing to Administrative Agent, (i) the institution of, or
threat of, any material proceeding against or affecting Borrower or the
Property, 


 


34




















 


including any eminent domain or other condemnation
proceedings affecting the Property, or (ii) any material development in any
proceeding already disclosed, which, in either case, could reasonably be
expected to have a Material Adverse Effect on Borrower or the Property, which
notice shall contain such information as may be reasonably available to
Borrower to enable Administrative Agent and its counsel to evaluate such
matters.


8.8           ENVIRONMENTAL NOTICES.


 


Borrower shall notify Administrative Agent, in writing,
as soon as practicable, and in any event within ten (10) days after Borrower’s
learning thereof, of any notice required pursuant to Section 6.2(c).


ARTICLE 9.  DEFAULTS AND REMEDIES


9.1           DEFAULT.


 


The occurrence of any one or more of the following
shall constitute an event of default (“Default”) under this Agreement
and the other Loan Documents:


(a)           Monetary.  Borrower’s
failure to pay when due any sums payable under the Notes or any of the other
Loan Documents and such failure continues for a period of three (3) business
days; or


 


(b)           Performance
of Obligations.  Borrower’s or Leasehold Mortgagor’s failure to
perform any obligation in addition to those in Section 9.1(a) above
under any of the Loan Documents or Other Related Documents; provided, however,
that if a cure period is provided for the remedy of such failure, Borrower’s
failure to perform will not constitute a Default until such date as the
specified cure period expires; or


 


(c)           Use.  The
prohibition, enjoining or interruption of Borrower’s right to occupy, use or
lease any material portion of the Property for a continuous period of more than
thirty (30) days; or


 


(d)           Liens,
Attachment; Condemnation.  (i) The recording of any claim of
Lien (other than a Permitted Lien) against the Property or the service on
Administrative Agent or any Lender of any bonded stop notice relating to the
Loan and the continuance of such claim of Lien or bonded stop notice for twenty
(20) days without discharge, satisfaction or provision for payment being made
by Borrower in a manner satisfactory to Administrative Agent; or (ii) the
condemnation, seizure or appropriation of, or occurrence of an uninsured
casualty with respect to any material portion of the Property; or
(iii) the sequestration or attachment of, or any levy or execution upon
any of the Property, any other collateral provided by Borrower under any of the
Loan Documents or any substantial portion of the other assets of Borrower,
which sequestration, attachment, levy or execution is not released, expunged or
dismissed prior to the earlier of thirty (30) days or the sale of the assets
affected thereby; or


 


(e)           Representations
and Warranties.  (i) The material breach of any
representation or warranty of Borrower in any of the Loan Documents; or
(ii) any material adverse change in the financial condition of Borrower
from the financial condition represented to Administrative Agent and Lenders as
of the later of:  (A) the Effective
Date; or (B) the date upon which the financial condition of such party was
first represented to Administrative Agent and Lenders; or


 


(f)            Voluntary
Bankruptcy; Insolvency; Dissolution.  (i) The filing of a
petition by Borrower for relief under the Bankruptcy Code, or under any other
present or future state or federal law regarding bankruptcy, reorganization or
other debtor relief law; (ii) the filing of any pleading or an answer by
Borrower in any involuntary proceeding under the Bankruptcy Code or other
debtor relief law which admits the jurisdiction of the court or the petition’s
material allegations regarding Borrower’s insolvency; (iii) a general
assignment by Borrower for the benefit of creditors; or (iv) Borrower applying
for, or the appointment of, a receiver, trustee, custodian or liquidator of
Borrower or any of its property; or


 


 


35

















 


 


(g)           Involuntary
Bankruptcy.  The failure of Borrower to effect a full dismissal
of any involuntary petition under the Bankruptcy Code or under any other debtor
relief law that is filed against Borrower or in any way restrains or limits
Borrower, Administrative Agent or Lenders regarding the Loan or the Property,
prior to the earlier of the entry of any court order granting relief sought in
such involuntary petition, or sixty (60) days after the date of filing of such
involuntary petition; or


 


(h)           Loss of Priority.  The failure at any time of
the Mortgage to be a valid first lien upon the Property or any portion thereof
(subject to Permitted Liens), other than as a result of any release or
reconveyance of the Mortgage with respect to all or any portion of the Property
pursuant to the terms and conditions of this Agreement; or


 


(i)            Hazardous Materials.  The discovery of any significant Hazardous Materials in, on
or about the Property subsequent to the Effective Date.  Any such Hazardous Materials shall be
“significant” for this purpose if said Hazardous Materials, in Administrative
Agent’s reasonable discretion, constitute a Materially Adverse Effect; or


 


(j)            Other Obligors.  The occurrence of any of the events
specified in Section 9.1(f) or Section 9.1(g) as to any person or entity other
than Borrower, including, without limitation, Leasehold Mortgagor, which is in
any manner obligated to the Administrative Agent or Lenders under the Loan
Documents.


 


9.2           ACCELERATION UPON DEFAULT; REMEDIES.


 


Upon the occurrence of any Default specified in this Article 9,
Requisite Lenders may, at their sole option, declare all sums owing to Lenders
under the Notes, this Agreement and the other Loan Documents immediately due and
payable.  Upon such acceleration,
Administrative Agent, at the direction of Requisite Lenders, may, in addition
to all other remedies permitted under this Agreement and the other Loan
Documents and at law or equity, apply any sums in the Account to the sums owing
under the Loan Documents and any and all obligations of Lenders to fund further
disbursements under the Loan shall terminate.


9.3           DISBURSEMENTS TO THIRD PARTIES.


 


Upon the occurrence of a Default occasioned by
Borrower’s failure to pay money to a third party as required by this Agreement,
Administrative Agent may but shall not be obligated to make such payment from
the Loan proceeds or other funds of Lenders. 
If such payment is made from proceeds of the Loan, Borrower shall
immediately deposit with Administrative Agent, upon written demand, an amount
equal to such payment.  If such payment
is made from funds of Lenders, Borrower shall immediately repay such funds upon
written demand of Administrative Agent. 
In either case, the Default with respect to which any such payment has
been made by Administrative Agent or Lenders shall not be deemed cured until
such deposit or repayment (as the case may be) has been made by Borrower to
Administrative Agent.


9.4           REPAYMENT OF FUNDS ADVANCED.


 


Any funds expended by Administrative Agent or any
Lender in the exercise of its rights or remedies under this Agreement and the
other Loan Documents shall be payable to Administrative Agent upon demand,
together with interest at the rate applicable to the principal balance of the
Loan from the date the funds were expended.


9.5           RIGHTS CUMULATIVE, NO WAIVER.


 


All Administrative Agent’s and Lenders’ rights and
remedies provided in this Agreement and the other Loan Documents, together with
those granted by law or at equity, are cumulative and may be exercised by
Administrative Agent or Lenders at any time. 
Administrative Agent’s or any Lender’s exercise of any right or remedy
shall not constitute a cure of any Default unless all sums then due and payable
to Lenders under the Loan Documents are repaid and Borrower has cured all other
Defaults.  No waiver 


 


36

















 


shall be implied from any failure of Administrative
Agent or any Lender to take, or any delay by Administrative Agent or any Lender
in taking, action concerning any Default or failure of condition under the Loan
Documents, or from any previous waiver of any similar or unrelated Default or
failure of condition.  Any waiver or
approval under any of the Loan Documents must be in writing and shall be
limited to its specific terms.


ARTICLE 10.  THE ADMINISTRATIVE
AGENT; INTERCREDITOR PROVISIONS


10.1         APPOINTMENT AND AUTHORIZATION.


 


(a)           Each Lender hereby irrevocably
appoints and authorizes the Administrative Agent to take such action as
contractual representative on such Lender’s behalf and to exercise such powers
under this Agreement, the other Loan Documents and Other Related Documents as
are specifically delegated to the Administrative Agent by the terms hereof and
thereof, together with such powers as are reasonably incidental thereto.  Not in limitation of the foregoing, each
Lender authorizes and directs the Administrative Agent to enter into the Loan
Documents and Other Related Documents for the benefit of the Lenders.


(b)           Each Lender hereby agrees that,
except as otherwise set forth herein, any action taken by the Requisite Lenders
in accordance with the provisions of this Agreement, the Loan Documents or the
Other Related Documents, and the exercise by the Requisite Lenders of the
powers set forth herein or therein, together with such other powers as are
reasonably incidental thereto, shall be authorized and binding upon all of the
Lenders.


(c)           Nothing herein shall be construed to
deem the Administrative Agent a trustee or fiduciary for any Lender or to
impose on the Administrative Agent duties or obligations other than those
expressly provided for herein.  Without
limiting the generality of the foregoing, the use of the terms “Administrative
Agent”, “Agent”, “agent” and similar terms in the Loan Documents or Other
Related Documents with reference to the Administrative Agent is not intended to
connote any fiduciary or other implied (or express) obligations arising under
agency doctrine of any applicable law. 
Instead, use of such terms is merely a matter of market custom, and is
intended to create or reflect only an administrative relationship between
independent contracting parties.


(d)           The Administrative Agent shall
deliver to each Lender, promptly upon receipt thereof by the Administrative
Agent, copies of each of the financial statements, certificates, notices and
other documents delivered to the Administrative Agent pursuant to Article
8.  The Administrative Agent will also
furnish to any Lender, upon the request of such Lender, a copy (or, where
appropriate, an original) of any document, instrument, agreement, certificate
or notice furnished to the Administrative Agent by the Borrower, any Loan Party
or any other Affiliate of the Borrower, pursuant to this Agreement or any other
Loan Document not already delivered to such Lender pursuant to the terms of
this Agreement or any such other Loan Document.


(e)           As to any matters not expressly
provided for by the Loan Documents and Other Related Documents (including,
without limitation, enforcement or collection of any of Borrower’s obligations
hereunder), Administrative Agent shall not be required to exercise any
discretion or take any action, but shall be required to act or to refrain from
acting (and shall be fully protected in so acting or refraining from acting)
upon the instructions of the Requisite Lenders (or all of the Lenders if
explicitly required under any other provision of this Agreement), and such
instructions shall be binding upon all Lenders and all holders of any of the
obligations of Borrower; provided, however, that, notwithstanding
anything in this Agreement to the contrary, the Administrative Agent shall not
be required to take any action which exposes the Administrative Agent to
personal liability or which is contrary to this Agreement or any other Loan
Document or Requirements of Law.  Not in
limitation of the foregoing, the Administrative Agent shall exercise any right
or remedy it or the Lenders may have under any Loan Document upon the
occurrence of a Potential Default or Default unless the Requisite Lenders have
directed the Administrative Agent otherwise. 
Without limiting the foregoing, no Lender shall have any right of action
whatsoever against the Administrative Agent as a result of the Administrative
Agent acting


 


37

















 


or refraining from acting under this Agreement, the
other Loan Documents, or the Other Related Documents in accordance with the
instructions of the Requisite Lenders, or where applicable, all the Lenders.


10.2         WELLS FARGO AS LENDER.


 


Wells Fargo, as a Lender, shall have the same rights
and powers under this Agreement and any other Loan Document as any other Lender
and may exercise the same as though it were not the Administrative Agent; and
the term “Lender” or “Lenders” shall, unless otherwise expressly indicated,
include Wells Fargo in each case in its individual capacity.  Wells Fargo and its affiliates may each
accept deposits from, maintain deposits or credit balances for, invest in, lend
money to, act as trustee under indentures of, serve as financial advisor to,
and generally engage in any kind of business with the Borrower, any other Loan
Party or any other affiliate thereof as if it were any other bank and without
any duty to account therefor to the other Lenders.  Further, the Administrative Agent and any
affiliate may accept fees and other consideration from the Borrower for
services in connection with this Agreement and otherwise without having to account
for the same to the other Lenders.  The
Lenders acknowledge that, pursuant to such activities, Wells Fargo or its
affiliates may receive information regarding the Borrower, other loan parties,
other subsidiaries and other Affiliates (including information that may be
subject to confidentiality obligations in favor of such Person) and acknowledge
that the Administrative Agent shall be under no obligation to provide such
information to them.


10.3         LOAN DISBURSEMENTS.


 


(a)           Following receipt of a complete
Application for Advance, Administrative Agent shall send a copy thereof by
facsimile to each other Lender and shall otherwise notify each Lender of the
proposed disbursement and the Funding Date. 
Each Lender shall make available to Administrative Agent (or the funding
bank or entity designated by Administrative Agent), the amount of such Lender’s
Pro Rata Share of such disbursement in immediately available funds not later
than the times designated in Section 10.3(b).  Unless Administrative Agent shall have been
notified by any Lender not later than the close of business (San Francisco
time) on the Business Day immediately preceding the Funding Date in respect of
any disbursement that such Lender does not intend to make available to
Administrative Agent such Lender’s Pro Rata Share of such disbursement,
Administrative Agent may assume that such Lender shall make such amount
available to Administrative Agent.  If
any Lender does not notify Administrative Agent of its intention not to make
available its Pro Rata Share of such disbursement as described above, but does
not for any reason make available to Administrative Agent such Lender’s Pro
Rata Share of such disbursement, such Lender shall pay to Administrative Agent
forthwith on demand such amount, together with interest thereon at the Federal
Funds Rate.  In any case where a Lender
does not for any reason make available to Administrative Agent such Lender’s
Pro Rata Share of such disbursement, Administrative Agent, in its sole
discretion, may, but shall not be obligated to, fund to Borrower such Lender’s
Pro Rata Share of such disbursement.  If
Administrative Agent funds to Borrower such Lender’s Pro Rata Share of such
disbursement and if such Lender subsequently pays to Administrative Agent such
corresponding amount, such amount so paid shall constitute such Lender’s Pro
Rata Share of such disbursement.  Nothing
in this Section 10.3(a) shall alter the respective rights and
obligations of the parties hereunder in respect of a Defaulting Lender or a
Non-Pro Rata Advance.


(b)           Requests by Administrative Agent for
funding by Lenders of disbursements will be made by telecopy.  Each Lender shall make the amount of its
disbursement available to Administrative Agent in Dollars and in immediately
available funds, to such bank and account, in El Segundo, California (to such
bank and account in such other place) as Administrative Agent may designate,
not later than 9:00 A.M. (San Francisco time) (or for any Lender which is based
in and funds from Hawaii, noon (San Francisco time)) on the Funding Date
designated by Administrative Agent with respect to such disbursement, but in no
event earlier than two (2) Business Days following Lender’s receipt of the
applicable Application for Payment.


(c)           Nothing in this Section 10.3
shall be deemed to relieve any Lender of its obligation hereunder to make its
Pro Rata Share of disbursements on any Funding Date, nor shall 


 


38

















 


Administrative Agent or any Lender be responsible for
the failure of any other Lender to perform its obligations to make any
disbursement hereunder, and the Commitment of any Lender shall not be increased
or decreased as a result of the failure by any other Lender to perform its
obligation to make a disbursement.


10.4         DISTRIBUTION AND APPORTIONMENT OF PAYMENTS;
DEFAULTING LENDERS.


 


(a)           Subject to Section 10.4(b)
below, payments actually received by Administrative Agent for the account of
Lenders shall be paid to them promptly after receipt thereof by Administrative
Agent, but in any event within two (2) Business Days, provided that
Administrative Agent shall pay to Lenders interest thereon, at the lesser of
(i) the Federal Funds Rate and (ii) the rate of interest applicable to the
Loan, from the Business Day following receipt of such funds by Administrative Agent
until such funds are paid in immediately available funds to Lenders.  All payments of principal, interest, and
other payments under the Loan Documents or Other Related Documents shall be
allocated among such of Lenders as are entitled thereto, in proportion to their
respective Pro Rata Shares in the Loan or otherwise as provided herein or as
separately agreed by Administrative Agent and any Lender.  Administrative Agent shall promptly
distribute, but in any event within two (2) Business Days, to each Lender at
its primary address set forth on the appropriate signature page hereof or on
the Assignment and Assumption Agreement, or at such other address as a Lender
may request in writing, such funds as it may be entitled to receive, provided
that Administrative Agent shall in any event not be bound to inquire into or
determine the validity, scope or priority of any interest or entitlement of any
Lender and may suspend all payments and seek appropriate relief (including,
without limitation, instructions from Requisite Lenders or all Lenders, as
applicable, or an action in the nature of interpleader) in the event of any
doubt or dispute as to any apportionment or distribution contemplated
hereby.  The order of priority herein is
set forth solely to determine the rights and priorities of Lenders as among
themselves and may at any time or from time to time be changed by Lenders as
they may elect, in writing in accordance with this Agreement, without necessity
of notice to or consent of or approval by Borrower or any other Person.  All payments or other sums received by
Administrative Agent for the account of Lenders shall not constitute property
or assets of the Administrative Agent and shall be held by Administrative
Agent, solely in its capacity as agent for itself and the other Lenders,
subject to the Loan Documents and the Other Related Documents.


(b)           Notwithstanding any provision hereof
to the contrary, until such time as a Defaulting Lender has funded its Pro Rata
Share of a Protective Advance or prior Loan disbursements which was previously
a Non-Pro Rata Advance, or all other Lenders have received payment in full
(whether by repayment or prepayment) of the amounts due in respect of such
Non-Pro Rata Advance, all of the indebtedness and obligations owing to such
Defaulting Lender hereunder shall be subordinated in right of payment, as
provided in the following sentence, to the prior payment in full of all
principal, interest and fees in respect of all Non-Pro Rata Advances in which
the Defaulting Lender has not funded its Pro Rata Share (such principal,
interest and fees being referred to as “Senior Loans”).  All amounts paid by Borrower and otherwise
due to be applied to the indebtedness and obligations owing to the Defaulting
Lender pursuant to the terms hereof shall be distributed by Administrative
Agent to the other Lenders in accordance with their respective Pro Rata Shares
of the Loan (recalculated for purposes hereof to exclude the Defaulting Lender’s
Pro Rata Share of the Loan), until all Senior Loans have been paid in
full.  This provision governs only the
relationship among Administrative Agent, each Defaulting Lender, and the other
Lenders; nothing hereunder shall limit the obligations of Borrower under this
Agreement.  The provisions of this
section shall apply and be effective regardless of whether a Default occurs and
is then continuing, and notwithstanding (a) any other provision of this
Agreement to the contrary, (b) any instruction of Borrower as to its desired
application of payments or (c) the suspension of such Defaulting Lender’s right
to vote on matters which are subject to the consent or approval of Requisite
Lenders or all Lenders.  Administrative
Agent shall be entitled to (i) withhold or setoff, and to apply to the payment
of the defaulted amount and any related interest, any amounts to be paid to
such Defaulting Lender under this Agreement, and (ii) bring an action or suit
against such Defaulting Lender in a court of competent jurisdiction to recover
the defaulted amount and any related interest. 
In addition, the Defaulting Lender shall indemnify, defend and hold
Administrative Agent and each of the other Lenders harmless from and against
any and all liabilities and costs, plus interest thereon at the Default Rate as
set forth in the Notes, 


 


39

















 


which they may sustain or incur by reason of or as a
direct consequence of the Defaulting Lender’s failure or refusal to perform its
obligations under this Agreement.


10.5         PRO RATA TREATMENT.


 


Except to the extent otherwise provided herein:  (a) each borrowing from Lenders shall be made
from the Lenders, each payment of the fees shall be made for the account of the
Lenders, and each termination or reduction of the amount of the Commitments
pursuant to this Agreement shall be applied to the respective Commitments of
the Lenders, pro rata according to the amounts of their respective Commitments;
(b) each payment or prepayment of principal of the Loan by the Borrower shall
be made for the account of the Lenders pro rata in accordance with the
respective unpaid principal amounts of the Loan held by them, provided that if
immediately prior to giving effect to any such payment in respect of the Loan
the outstanding principal amount of the Loan shall not be held by the Lenders
pro rata in accordance with their respective Commitments in effect at the time
the Loan was made, then such payment shall be applied to the Loan in such
manner as shall result, as nearly as is practicable, in the outstanding
principal amount of the Loan being held by the Lenders pro rata in accordance
with their respective Commitments; and (c) each payment of interest on the Loan
by the Borrower shall be made for the account 
of the Lenders pro rata in accordance with the amounts of interest on
the Loan then due and payable to the respective Lenders; (d) the Lenders’
participation in, and payment obligations in respect of, Swingline Loans under Section
2.5, shall be in accordance with their respective Pro Rata Shares; and (f)
the Lenders’ participation in, and payment obligations in respect of, Letters
of Credit under Section 2.4, shall be pro rata in accordance with their
respective Commitments.  All payments of
principal, interest, fees and other amounts in respect of the Swingline Loans
shall be for the account of the Swingline Lender only (except to the extent any
Lender shall have acquired a participating interest in any such Swingline Loan
pursuant to Section 2.5.


10.6         SHARING OF PAYMENTS, ETC.


 


Lenders agree among themselves that (i) with respect
to all amounts received by them which are applicable to the payment of the
obligations of Borrower or Leasehold Mortgagor under the Loan, equitable
adjustment will be made so that, in effect, all such amounts will be shared
among them ratably in accordance with their Pro Rata Shares in the Loan,
whether received by voluntary payment, by counterclaim or cross action or by
the enforcement of any or all of such obligations, (ii) if any of them shall by
voluntary payment or by the exercise of any right of counterclaim or otherwise,
receive payment of a proportion of the aggregate amount of such obligations
held by it which is greater than its Pro Rata Share in the Loan of the payments
on account of such obligations, the one receiving such excess payment shall
purchase, without recourse or warranty, an undivided interest and participation
(which it shall be deemed to have done simultaneously upon the receipt of such
payment) in such obligations owed to the others so that all such recoveries
with respect to such obligations shall be applied ratably in accordance with
such Pro Rata Shares; provided, that if all or part of such excess payment
received by the purchasing party is thereafter recovered from it, those
purchases shall be rescinded and the purchase prices paid for such
participations shall be returned to that party to the extent necessary to
adjust for such recovery, but without interest except to the extent the
purchasing party is required to pay interest in connection with such recovery.  Borrower agrees that any Lender so purchasing
a participation from another Lender pursuant to this Section 10.6 may,
to the fullest extent permitted by law, exercise all its rights of payment with
respect to such participation as fully as if such Lender were the direct
creditor of Borrower in the amount of such participation.


10.7         COLLATERAL MATTERS; PROTECTIVE ADVANCES.


 


(a)           Each Lender hereby authorizes the
Administrative Agent, without the necessity of any notice to or further consent
from any Lender, from time to time prior to a Default, to take any action with
respect to any Collateral, Loan Documents or Other Related Documents which may
be necessary to perfect and maintain perfected the Liens upon the Collateral
granted pursuant to any of the Loan Documents or Other Related Documents.


 


40

















 


(b)           The Lenders hereby authorize the
Administrative Agent, at its option and in its discretion, to release any Lien
granted to or held by the Administrative Agent upon any Collateral (i) upon
termination of the Commitments and indefeasible payment and satisfaction in
full of all of obligations of Borrower hereunder; (ii) as expressly permitted
by, but only in accordance with, the terms of the applicable Loan Document; and
(iii) if approved, authorized or ratified in writing by the Requisite Lenders
(or such greater number of Lenders as this Agreement or any other Loan Document
may expressly provide).  Upon request by
the Administrative Agent at any time, the Lenders will confirm in writing the
Administrative Agent’s authority to release particular types or items of
Collateral pursuant to this Section.


(c)           Upon any sale and transfer of
Collateral which is expressly permitted pursuant to the terms of this
Agreement, and upon at least five (5) Business Days’ prior written request by
the Borrower, the Administrative Agent shall (and is hereby irrevocably
authorized by the Lenders to) execute such documents as may be necessary to
evidence the release of the Liens granted to the Administrative Agent for the
benefit of the Lenders herein or pursuant hereto upon the Collateral that was
sold or transferred; provided, however, that (i) the
Administrative Agent shall not be required to execute any such document on
terms which, in the Administrative Agent’s opinion, would expose the
Administrative Agent to liability or create any obligation or entail any
consequence other than the release of such Liens without recourse or warranty
and (ii) such release shall not in any manner discharge, affect or impair the
obligations of Borrower or any Liens upon (or obligations of the Borrower or
any other Loan Party in respect of) all interests retained by the Borrower or
any other Loan Party, including (without limitation) the proceeds of such sale
or transfer, all of which shall continue to constitute part of the
Collateral.  In the event of any sale or
transfer of Collateral, or any foreclosure with respect to any of the
Collateral, the Administrative Agent shall be authorized to deduct all of the
expenses reasonably incurred by the Administrative Agent from the proceeds of
any such sale, transfer or foreclosure.


(d)           The Administrative Agent shall have
no obligation whatsoever to the Lenders or to any other Person to assure that
the Collateral exists or is owned by the Borrower or any other Loan Party or is
cared for, protected or insured or that the Liens granted to the Administrative
Agent herein or pursuant hereto have been properly or sufficiently or lawfully
created, perfected, protected or enforced or are entitled to any particular
priority, or to exercise or to continue exercising at all or in any manner or
under any duty of care, disclosure or fidelity any of the rights, authorities
and powers granted or available to the Administrative Agent in this Section or
in any of the Loan Documents or Other Related Documents, it being understood
and agreed that in respect of the Collateral, or any act, omission or event
related thereto, the Administrative Agent may act in any manner it may deem
appropriate, in its sole discretion, given the Administrative Agent’s own
interest in the Collateral as one of the Lenders and that the Administrative
Agent shall have no duty or liability whatsoever to the Lenders, except to the
extent resulting from its gross negligence or willful misconduct.


(e)           The Administrative Agent may make,
and shall be reimbursed by the Lenders (in accordance with their Pro Rata
Shares) to the extent not reimbursed by the Borrower for, Protective Advances
during any one calendar year with respect to any Property that is Collateral up
to the sum of (i) amounts expended to pay real estate taxes, assessments and
governmental charges or levies imposed upon such Property; (ii) amounts
expended to pay insurance premiums for policies of insurance related to such
Property; and (iii) $250,000.00. 
Protective Advances in excess of said sum during any calendar year for
any Property that is Collateral shall require the consent of the Requisite
Lenders.  The Borrower agrees to pay on
demand all Protective Advances.


(f)            Each Lender agrees that it will not
take any action, nor institute any actions or proceedings, against Borrower or
any other obligor hereunder under the Loan Documents or the Other Related
Documents with respect to exercising claims against or rights in the Collateral
without the written consent of Requisite Lenders.


10.8         POST-FORECLOSURE PLANS.


 


If all or any portion of the Collateral is acquired by
the Administrative Agent as a result of a foreclosure or the acceptance of a
deed or assignment in lieu of foreclosure, or is retained in satisfaction of
all or any 


 


41

















 


part of the obligations of Borrower hereunder, the
title to any such Collateral, or any portion thereof, shall be held in the name
of the Administrative Agent or a nominee or subsidiary of the Administrative
Agent, as agent, for the ratable benefit of all Lenders.  The Administrative Agent shall prepare a
recommended course of action for such Collateral (a “Post-Foreclosure Plan”),
which shall be subject to the approval of the Requisite Lenders.  In accordance with the approved
Post-Foreclosure Plan, the Administrative Agent shall manage, operate, repair,
administer, complete, construct, restore or otherwise deal with the Collateral
acquired, and shall administer all transactions relating thereto, including,
without limitation, employing a management agent, leasing agent and other
agents, contractors and employees, including agents for the sale of such
Collateral, and the collecting of rents and other sums from such Collateral and
paying the expenses of such Collateral. 
Actions taken by the Administrative Agent with respect to the
Collateral, which are not specifically provided for in the approved Post-Foreclosure
Plan or reasonably incidental thereto, shall require the written consent of the
Requisite Lenders by way of supplement to such Post-Foreclosure Plan.  Upon demand therefor from time to time, each
Lender will contribute its share (based on its Pro Rata Share) of all
reasonable costs and expenses incurred by the Administrative Agent pursuant to
the approved Post-Foreclosure Plan in connection with the construction,
operation, management, maintenance, leasing and sale of such Collateral.  In addition, the Administrative Agent shall
render or cause to be rendered to each Lender, on a monthly basis, an income
and expense statement for such Collateral, and each Lender shall promptly
contribute its Pro Rata Share of any operating loss for such Collateral, and
such other expenses and operating reserves as the Administrative Agent shall
deem reasonably necessary pursuant to and in accordance with the approved
Post-Foreclosure Plan.  To the extent
there is net operating income from such Collateral, the Administrative Agent
shall, in accordance with the approved Post-Foreclosure Plan, determine the
amount and timing of distributions to the Lenders.  All such distributions shall be made to the
Lenders in accordance with their respective Pro Rata Shares.  The Lenders acknowledge and agree that if
title to any Collateral is obtained by the Administrative Agent or its nominee,
such Collateral will not be held as a permanent investment but will be
liquidated as soon as practicable.  The
Administrative Agent shall undertake to sell such Collateral, at such price and
upon such terms and conditions as the Requisite Lenders reasonably shall
determine to be most advantageous to the Lenders.  Any purchase money mortgage or deed of trust
taken in connection with the disposition of such Collateral in accordance with
the immediately preceding sentence shall name the Administrative Agent, as
agent for the Lenders, as the beneficiary or mortgagee.  In such case, the Administrative Agent and
the Lenders shall enter into an agreement with respect to such purchase money
mortgage or deed of trust defining the rights of the Lenders in the same Pro
Rata Shares as provided hereunder, which agreement shall be in all material
respects similar to this Article insofar as the same is appropriate or
applicable.


10.9         APPROVALS OF LENDERS.


 


All communications from the Administrative Agent to
any Lender requesting such Lender’s determination, consent, approval or
disapproval (a) shall be given in the form of a written notice to such Lender,
(b) shall be accompanied by a description of the matter or issue as to which
such determination, approval, consent or disapproval is requested, or shall
advise such Lender where information, if any, regarding such matter or issue
may be inspected, or shall otherwise describe the matter or issue to be resolved,
(c) shall include, if reasonably requested by such Lender and to the extent not
previously provided to such Lender, written materials and a summary of all oral
information provided to the Administrative Agent by the Borrower in respect of
the matter or issue to be resolved, and (d) shall include the Administrative
Agent’s recommended course of action or determination in respect thereof.  Unless a Lender shall give written notice to
the Administrative Agent that it specifically objects to the recommendation or
determination of the Administrative Agent (together with a reasonable written
explanation of the reasons behind such objection) within ten (10) Business Days
(or such lesser or greater period as may be specifically required under the
express terms of the Loan Documents or Other Related Documents) of receipt of
such communication, such Lender shall be deemed to have conclusively approved
of or consented to such recommendation or determination.


 


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10.10       NOTICE OF DEFAULTS.


 


The Administrative Agent shall not be deemed to have
knowledge or notice of the occurrence of a Default or Potential Default unless
the Administrative Agent has received notice from a Lender or the Borrower
referring to this Agreement, describing with reasonable specificity such
Default or Potential Default and stating that such notice is a “notice of
default”.  If any Lender (excluding the
Lender which is also serving as the Administrative Agent) becomes aware of any
Default or Potential Default, it shall promptly send to the Administrative
Agent such a “notice of default”. 
Further, if the Administrative Agent receives such a “notice of default,”
the Administrative Agent shall give prompt notice thereof to the Lenders.


10.11       ADMINISTRATIVE AGENT’S RELIANCE, ETC.


 


Notwithstanding any other provisions of this
Agreement, any other Loan Documents or the Other Related Documents, neither the
Administrative Agent nor any of its directors, officers, agents, employees or
counsel shall be liable for any action taken or not taken by it under or in
connection with this Agreement or any other Loan Document, except for its or
their own gross negligence or willful misconduct in connection with its duties
expressly set forth herein or therein. 
Without limiting the generality of the foregoing, the Administrative
Agent: may consult with legal counsel (including its own counsel or counsel for
the Borrower or any other Loan Party), independent public accountants and other
experts selected by it and shall not be liable for any action taken or omitted
to be taken in good faith by it in accordance with the advice of such counsel,
accountants or experts.  Neither the
Administrative Agent nor any of its directors, officers, agents, employees or
counsel: (a) makes any warranty or representation to any Lender or any other
Person and shall be responsible to any Lender or any other Person for any
statement, warranty or representation made or deemed made by the Borrower, any
other Loan Party or any other Person in or in connection with this Agreement or
any other Loan Document; (b) shall have any duty to ascertain or to inquire as
to the performance or observance of any of the terms, covenants or conditions
of this Agreement or any other Loan Document or the satisfaction of any
conditions precedent under this Agreement or any Loan Document on the part of
the Borrower or other Persons or inspect the property, books or records of the
Borrower or any other Person; (c) shall be responsible to any Lender for the
due execution, legality, validity, enforceability, genuineness, sufficiency or
value of this Agreement or any other Loan Document, any other instrument or
document furnished pursuant thereto or any Collateral covered thereby or the
perfection or priority of any Lien in favor of the Administrative Agent on
behalf of the Lenders in any such Collateral; (d) shall have any liability in
respect of any recitals, statements, certifications, representations or
warranties contained in any of the Loan Documents or Other Related Documents or
any other document, instrument, agreement, certificate or statement delivered
in connection therewith; and (e) shall incur any liability under or in respect
of this Agreement or any other Loan Document by acting upon any notice, consent,
certificate or other instrument or writing (which may be by telephone, telecopy
or electronic mail) believed by it to be genuine and signed, sent or given by
the proper party or parties.  The
Administrative Agent may execute any of its duties under the Loan Documents or
Other Related Documents by or through agents, employees or attorneys-in-fact
and shall not be responsible for the negligence or misconduct of any agent or
attorney-in-fact that it selects in the absence of gross negligence or willful
misconduct.


10.12       INDEMNIFICATION OF ADMINISTRATIVE AGENT.


 


Regardless of whether the transactions contemplated by
this Agreement, the other Loan Documents and Other Related Documents are
consummated, each Lender agrees to indemnify the Administrative Agent (to the
extent not reimbursed by the Borrower and without limiting the obligation of
the Borrower to do so) pro rata in accordance with such Lender’s respective Pro
Rata Share, from and against any and all liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or disbursements
of any kind or nature whatsoever which may at any time be imposed on, incurred
by, or asserted against the Administrative Agent (in its capacity as
Administrative Agent but not as a “Lender”) in any way relating to or arising
out of the Loan Documents or Other Related Documents, any transaction
contemplated hereby or thereby or any action taken or omitted by the
Administrative Agent under the Loan Documents and Other Related Documents
(collectively, “Indemnifiable Amounts”); provided, however, that no
Lender shall be liable for any portion of such Indemnifiable Amounts to the
extent 


 


43

















 


resulting from the Administrative Agent’s gross
negligence or willful misconduct as determined by a court of competent
jurisdiction in a final, non-appealable judgment provided, however, that no
action taken in accordance with the directions of the Requisite Lenders shall
be deemed to constitute gross negligence or willful misconduct for purposes of
this Section.  Without limiting the
generality of the foregoing, each Lender agrees to reimburse the Administrative
Agent (to the extent not reimbursed by the Borrower and without limiting the
obligation of the Borrower to do so) promptly upon demand for its ratable share
of any out-of-pocket expenses (including the reasonable fees and expenses of
the counsel to the Administrative Agent) incurred by the Administrative Agent
in connection with the preparation, negotiation, execution, administration, or
enforcement (whether through negotiations, legal proceedings, or otherwise) of,
or legal advice with respect to the rights or responsibilities of the parties
under, the Loan Documents and Other Related Documents, any suit or action
brought by the Administrative Agent to enforce the terms of the Loan Documents
and Other Related Documents and/or collect any obligation of Borrower
hereunder, any “lender liability” suit or claim brought against the
Administrative Agent and/or the Lenders, and any claim or suit brought against
the Administrative Agent and/or the Lenders arising under any Hazardous
Materials Laws.  Such out-of-pocket
expenses (including counsel fees) shall be advanced by the Lenders on the
request of the Administrative Agent notwithstanding any claim or assertion that
the Administrative Agent is not entitled to indemnification hereunder upon
receipt of an undertaking by the Administrative Agent that the Administrative
Agent will reimburse the Lenders if it is actually and finally determined by a
court of competent jurisdiction that the Administrative Agent is not so
entitled to indemnification.  The
agreements in this Section shall survive the payment of the Loans and all other
amounts payable hereunder or under the other Loan Documents or Other Related
Documents and the termination of this Agreement.  If the Borrower shall reimburse the
Administrative Agent for any Indemnifiable Amount following payment by any
Lender to the Administrative Agent in respect of such Indemnifiable Amount
pursuant to this Section, the Administrative Agent shall share such
reimbursement on a ratable basis with each Lender making any such payment.


10.13       LENDER CREDIT DECISION, ETC.


 


Each Lender expressly acknowledges and agrees that
neither the Administrative Agent nor any of its officers, directors, employees,
agents, counsel, attorneys-in-fact or other affiliates has made any
representations or warranties to such Lender and that no act by the
Administrative Agent hereafter taken, including any review of the affairs of
the Borrower, any other Loan Party or Affiliate, shall be deemed to constitute
any such representation or warranty by the Administrative Agent to any
Lender.  Each Lender acknowledges that it
has, independently and without reliance upon the Administrative Agent, any
other Lender or counsel to the Administrative Agent, or any of their respective
officers, directors, employees, agents or counsel, and based on the financial
statements of the Borrower, the other Loan Parties or Affiliates, and inquiries
of such Persons, its independent due diligence of the business and affairs of
the Borrower, the other Loan Parties and other Persons, its review of the Loan
Documents and the Other Related Documents, the legal opinions required to be
delivered to it hereunder, the advice of its own counsel and such other
documents and information as it has deemed appropriate, made its own credit and
legal analysis and decision to enter into this Agreement and the transactions
contemplated hereby.  Each Lender also
acknowledges that it will, independently and without reliance upon the
Administrative Agent, any other Lender or counsel to the Administrative Agent
or any of their respective officers, directors, employees and agents, and based
on such review, advice, documents and information as it shall deem appropriate
at the time, continue to make its own decisions in taking or not taking action
under the Loan Documents or Other Related Documents.  The Administrative Agent shall not be
required to keep itself informed as to the performance or observance by the
Borrower or any other Loan Party of the Loan Documents or Other Related
Documents or any other document referred to or provided for therein or to
inspect the properties or books of, or make any other investigation of, the
Borrower, any other Loan Party.  Except
for notices, reports and other documents and information expressly required to
be furnished to the Lenders by the Administrative Agent under this Agreement,
any of the other Loan Documents or Other Related Documents, the Administrative
Agent shall have no duty or responsibility to provide any Lender with any
credit or other information concerning the business, operations, property,
financial and other condition or creditworthiness of the Borrower, any other
Loan Party or any other Affiliate thereof which may come into possession of the
Administrative Agent or any of its officers, directors, employees, agents,
attorneys-in-fact or other Affiliates. 
Each Lender acknowledges that the


 


44
















 


Administrative Agent’s legal counsel in connection
with the transactions contemplated by this Agreement is only acting as counsel
to the Administrative Agent and is not acting as counsel to such Lender.


10.14       SUCCESSOR ADMINISTRATIVE AGENT.


 


Administrative Agent may resign at any time as
Administrative Agent under the Loan Documents and Other Related Documents by
giving written notice thereof to the Lenders and the Borrower.  Upon any such resignation, the Requisite Lenders
shall have the right to appoint a successor Administrative Agent which
appointment shall, provided no Default or Potential Default exists, be subject
to the Borrower’s approval, which approval shall not be unreasonably withheld
or delayed (except that the Borrower shall, in all events, be deemed to have
approved each Lender and any of its Affiliates as a successor Administrative
Agent).  If no successor Administrative
Agent shall have been so appointed in accordance with the immediately preceding
sentence, and shall have accepted such appointment, within thirty (30) days
after the current Administrative Agent’s giving of notice of resignation, then
the current Administrative Agent may, on behalf of the Lenders, appoint a
successor Administrative Agent, which shall be a Lender, if any Lender shall be
willing to serve, and otherwise shall be an Eligible Assignee.  Upon the acceptance of any appointment as
Administrative Agent hereunder by a successor Administrative Agent, such
successor Administrative Agent shall thereupon succeed to and become vested
with all the rights, powers, privileges and duties of the current
Administrative Agent, and the current Administrative Agent shall be discharged
from its duties and obligations under the Loan Documents and the Other Related
Documents.  After any Administrative
Agent’s resignation hereunder as Administrative Agent, the provisions of this Article
10. shall continue to inure to its benefit as to any actions taken or
omitted to be taken by it while it was Administrative Agent under the Loan
Documents and the Other Related Documents. 
Notwithstanding anything contained herein to the contrary, the
Administrative Agent may assign its rights and duties under the Loan Documents
and the Other Related Documents to any of its Affiliates by giving the Borrower
and each Lender prior written notice.


10.15       NO SET-OFFS.


 


Each Lender hereby acknowledges that the exercise by
any Lender of offset, set-off, banker’s lien or similar rights against any
deposit account or other property or asset of Borrower, whether or not located
in California, could result under certain laws in significant impairment of the
ability of all Lenders to recover any further amounts in respect of the
Loan.  Therefore, each Lender agrees not
to charge or offset any amount owed to it by Borrower against any of the
accounts, property or assets of Borrower or any of its affiliates held by such
Lender without the prior written approval of Administrative Agent and Requisite
Lenders.


ARTICLE 11.  MISCELLANEOUS
PROVISIONS


11.1         INDEMNITY.


 


BORROWER HEREBY AGREES TO DEFEND, INDEMNIFY AND HOLD
HARMLESS ADMINISTRATIVE AGENT AND EACH LENDER, THEIR RESPECTIVE DIRECTORS,
OFFICERS, EMPLOYEES, AGENTS, SUCCESSORS AND ASSIGNS (EACH, AN INDEMNIFIED PARTY”)
FROM AND AGAINST ANY AND ALL LOSSES, DAMAGES, LIABILITIES, CLAIMS, ACTIONS,
JUDGMENTS, COURT COSTS AND LEGAL OR OTHER EXPENSES (INCLUDING, WITHOUT
LIMITATION, ATTORNEYS’ FEES AND EXPENSES) WHICH ADMINISTRATIVE AGENT OR ANY
LENDER MAY INCUR AS A DIRECT OR INDIRECT CONSEQUENCE OF:  (A) THE PURPOSE TO WHICH BORROWER APPLIES
THE LOAN PROCEEDS; (B) THE FAILURE OF BORROWER TO PERFORM ANY OBLIGATIONS
AS AND WHEN REQUIRED BY THIS AGREEMENT, ANY OF THE OTHER LOAN DOCUMENTS OR ANY
OTHER RELATED DOCUMENT; (C) ANY FAILURE AT ANY TIME OF ANY OF BORROWER’S
REPRESENTATIONS OR WARRANTIES TO BE TRUE AND CORRECT; OR (D) ANY ACT OR
OMISSION BY BORROWER, CONSTITUENT PARTNER OR MEMBER OF BORROWER, ANY
CONTRACTOR, SUBCONTRACTOR OR MATERIAL SUPPLIER, ENGINEER, ARCHITECT OR OTHER
PERSON OR ENTITY WITH RESPECT TO ANY OF THE PROPERTY OR IMPROVEMENTS; PROVIDED,
HOWEVER, THAT SUCH DEFENSE, INDEMNIFICATION AND HOLD HARMLESS SHALL 


 


45

















 


NOT, AS TO ANY INDEMNIFIED PARTY, BE AVAILABLE TO THE
EXTENT THAT SUCH LOSSES, DAMAGES, LIABILITIES, CLAIMS, ACTIONS, JUDGMENTS,
COURT COSTS AND LEGAL OR OTHER EXPENSES (X) ARE DETERMINED BY A COURT OF
COMPETENT JURISDICTION BY FINAL AND NONAPPEALABLE JUDGMENT TO HAVE RESULTED
FROM THE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF SUCH INDEMNIFIED PARTY OR
(Y) RESULT FROM A CLAIM BROUGHT BY THE BORROWER OR ANY OTHER LOAN PARTY AGAINST
AN INDEMNIFIED PARTY FOR BREACH IN BAD FAITH OF SUCH INDEMNIFIED PARTY’S
OBLIGATIONS HEREUNDER OR UNDER ANY OTHER LOAN DOCUMENT, IF THE BORROWER OR SUCH
LOAN PARTY HAS OBTAINED A FINAL AND NONAPPEALABLE JUDGMENT IN ITS FAVOR ON SUCH
CLAIM AS DETERMINED BY A COURT OF COMPETENT JURISDICTION.  BORROWER SHALL IMMEDIATELY PAY TO
ADMINISTRATIVE AGENT OR SUCH LENDER UPON DEMAND ANY AMOUNTS OWING UNDER THIS INDEMNITY,
TOGETHER WITH INTEREST FROM THE DATE THE INDEBTEDNESS ARISES UNTIL PAID AT THE
RATE OF INTEREST APPLICABLE TO THE PRINCIPAL BALANCE OF THE LOAN.  BORROWER’S DUTY AND OBLIGATIONS TO DEFEND,
INDEMNIFY AND HOLD HARMLESS ADMINISTRATIVE AGENT AND EACH LENDER SHALL SURVIVE
CANCELLATION OF THE NOTES AND THE RELEASE OR PARTIAL RELEASE OF THE MORTGAGE.


11.2         FORM OF DOCUMENTS.


 


The form and substance of all documents, instruments,
and forms of evidence to be delivered to Administrative Agent under the terms
of this Agreement, any of the other Loan Documents or Other Related Documents
shall be subject to Administrative Agent s approval and shall not be modified,
superseded or terminated in any respect without Administrative Agent’s prior
written approval.


11.3         NO THIRD PARTIES BENEFITED.


 


No person other than Administrative Agent,  Lenders and Borrower and their permitted
successors and assigns shall have any right of action under any of the Loan
Documents or Other Related Documents.


11.4         NOTICES.


 


All notices, demands, or other communications under
this Agreement, the other Loan Documents or the Other Related Documents shall
be in writing and shall be delivered to the appropriate party at the address
set forth on the signature page of this Agreement (subject to change from time
to time by written notice to all other parties to this Agreement).  All communications shall be deemed served
upon delivery of, or if mailed, upon the first to occur of receipt or the
expiration of three (3) days after the deposit in the United States Postal
Service mail, postage prepaid and addressed to the address of Borrower or
Administrative Agent and Lenders at the address specified; provided, however,
that non-receipt of any communication as the result of any change of address of
which the sending party was not notified or as the result of a refusal to
accept delivery shall be deemed receipt of such communication.


11.5         ATTORNEY-IN-FACT.


 


Borrower hereby irrevocably appoints and authorizes
Administrative Agent, as Borrower’s attorney-in-fact, which agency is coupled
with an interest, to execute and/or record in Administrative Agent’s or
Borrower’s name any notices, instruments or documents that Administrative Agent
deems reasonably appropriate to protect Lenders’ interest under any of the Loan
Documents or Other Related Documents.


11.6         ACTIONS.


 


Borrower agrees that Administrative Agent or any
Lender, in exercising the rights, duties or liabilities of Administrative
Agent, Lenders or Borrower under the Loan Documents or Other Related Documents,
may commence, appear in or defend any action or proceeding purporting to affect
the Property, the Loan Documents or the Other Related Documents and Borrower
shall immediately reimburse Administrative Agent or such Lender upon demand for
all such expenses so incurred or paid by Administrative Agent or such Lender,
including, without limitation, attorneys’ fees and expenses and court costs.


 


46

















 


11.7         RIGHT OF CONTEST.


 


Borrower may contest in good faith any claim, demand,
levy or assessment (other than Liens and stop notices)  by any person other than Administrative Agent
or Lenders which would constitute a Default if: 
(a) Borrower pursues the contest diligently, in a manner which
Administrative Agent determines is not prejudicial to Administrative Agent or
any Lender, and does not impair the rights of Administrative Agent or any
Lender under any of the Loan Documents or Other Related Documents; and
(b) Borrower deposits with Administrative Agent any funds or other forms
of assurance which Administrative Agent in good faith determines from time to
time appropriate to protect Administrative Agent and each Lender from the
consequences of the contest being unsuccessful. 
Borrower’s compliance with this Section shall operate to prevent such
claim, demand, levy or assessment from becoming a Default.


11.8         RELATIONSHIP OF PARTIES.


 


The relationship of Borrower, Administrative Agent and
Lenders under the Loan Documents and Other Related Documents is, and shall at
all times remain, solely that of borrower and lender, and Administrative Agent
and Lenders neither undertake nor assumes any responsibility or duty to
Borrower or to any third party with respect to the Property, except as
expressly provided in this Agreement, the other Loan Documents and the Other
Related Documents.


11.9         DELAY OUTSIDE LENDER’S CONTROL.


 


No Lender or Administrative Agent shall be liable in
any way to Borrower or any third party for Administrative Agent’s or such
Lender’s failure to perform or delay in performing under the Loan Documents
(and Administrative Agent  or any Lender
may suspend or terminate all or any portion of Administrative Agent’s or such
Lender’s obligations under the Loan Documents) if such failure to perform or
delay in performing results directly or indirectly from, or is based upon, the
action, inaction, or purported action, of any governmental or local authority,
or because of war, rebellion, insurrection, strike, lock-out, boycott or
blockade (whether presently in effect, announced or in the sole judgment of Administrative
Agent or such Lender deemed probable), or from any Act of God or other cause or
event beyond Administrative Agent’s or such Lender’s control.


11.10       ATTORNEYS’ FEES AND EXPENSES; ENFORCEMENT.


 


If any attorney is engaged by Administrative Agent or
any Lender to enforce or defend any provision of this Agreement, any of the
other Loan Documents or Other Related Documents, or as a consequence of any
Default under the Loan Documents or Other Related Documents, with or without
the filing of any legal action or proceeding, and including, without
limitation, any fees and expenses incurred in any bankruptcy proceeding of the
Borrower, then Borrower shall immediately pay to Administrative Agent or such
Lender, upon demand, the amount of all reasonable attorneys’ fees and expenses
and all costs incurred by Administrative Agent or such Lender in connection
therewith, together with interest thereon from the date of such demand until
paid at the rate of interest applicable to the principal balance of the Loan.


11.11       IMMEDIATELY AVAILABLE FUNDS.


 


Unless otherwise expressly provided for in this
Agreement, all amounts payable by Borrower to Administrative Agent or any
Lender shall be payable only in United States Dollars, immediately available
funds.


11.12       AMENDMENTS AND WAIVERS.


 


(a)           Generally.  Except
as otherwise expressly provided in this Agreement, (i) any consent or approval
required or permitted by this Agreement or in any Loan Document to be given by
the Lenders may be given, (ii) any term of this Agreement or of any other Loan
Document (other than any fee letter solely between the Borrower and the
Administrative Agent) may be amended, (iii) the performance or observance by
the Borrower or any other Loan Party of any terms of this Agreement or such
other 


 


47

















 


Loan Document (other than any fee letter solely
between the Borrower and the Administrative Agent) may be waived, and (iv) the
continuance of any Default may be waived (either generally or in a particular instance
and either retroactively or prospectively) with, but only with, the written
consent of the Requisite Lenders (or the Administrative Agent at the written
direction of the Requisite Lenders), and, in the case of an amendment to any
Loan Document, the written consent of each Loan Party which is party
thereto.  Notwithstanding the previous
sentence, the Administrative Agent, shall be authorized on behalf of all the
Lenders, without the necessity of any notice to, or further consent from, any
Lender, to waive the imposition of the late fees provided in Section 2.10(c),
up to a maximum of 2 times per calendar year.


(b)           Unanimous
Consent.  Notwithstanding the foregoing, no amendment, waiver or
consent shall, unless in writing, and signed by all of the Lenders (or the
Administrative Agent at the written direction of the Lenders), do any of the
following:


 


(i)            increase the Commitments of the
Lenders (excluding any increase as a result of an assignment of Commitments
permitted under Section 11.13) or subject the Lenders to any
additional obligations;


(ii)           reduce the principal of, or interest
rates that have accrued or that will be charged on the outstanding principal
amount of, the Loan;


(iii)          reduce the amount of any fees payable
to the Lenders hereunder;


(iv)          postpone any date fixed for any
payment of principal of, or interest on, the Loan (including, without
limitation, the Maturity Date), for the payment of fees or any other
obligations of Borrower or Leasehold Mortgagor, or extend the expiration date
of any Letter of Credit beyond the Maturity Date;


(v)           change the Pro Rata Shares (excluding
any change as a result of an assignment of Commitments permitted under Section 11.13);


(vi)          amend this Section or amend the
definitions of the terms used in this Agreement or the other Loan Documents
insofar as such definitions affect the substance of this Section;


(vii)         modify the definition of the term “Requisite
Lenders” or modify in any other manner the number or percentage of the Lenders
required to make any determinations or waive any rights hereunder or to modify
any provision hereof;


(viii)        waive a Default under Section 9.1(a);
or


(ix)           release or dispose of any Collateral
unless released or disposed of as permitted by, and in accordance with, Section 10.7.


(c)           Amendment
of Administrative Agent’s Duties, Etc.  No amendment, waiver or
consent unless in writing and signed by the Administrative Agent, in addition
to the Lenders required hereinabove to take such action, shall affect the
rights or duties of the Administrative Agent under this Agreement, any of the
other Loan Documents or Other Related Documents.  No waiver shall extend to or affect any
obligation not expressly waived or impair any right consequent thereon and any
amendment, waiver or consent shall be effective only in the specific instance
and for the specific purpose set forth therein. 
No course of dealing or delay or omission on the part of the
Administrative Agent or any Lender in exercising any right shall operate as a
waiver thereof or otherwise be prejudicial thereto.  Any Default occurring hereunder shall
continue to exist until such time as such Default is waived in writing in
accordance with the terms of this Section, notwithstanding any attempted cure
or other action by the Borrower, any other Loan Party or any other Person
subsequent to the occurrence of such Default. 
Except as otherwise explicitly provided for herein or in any other Loan
Document, no notice to or demand upon the Borrower shall entitle the Borrower
to other or further notice or demand in similar or other circumstances.


 


48

















 


 


11.13       SUCCESSORS AND ASSIGNS.


 


(a)           Generally.  The
provisions of this Agreement shall be binding upon and inure to the benefit of
the parties hereto and their respective successors and assigns, except that the
Borrower may not assign or otherwise transfer any of is rights under this
Agreement without the prior written consent of all the Lenders (and any such
assignment or transfer to which all of the Lenders have not consented shall be
void).


 


(b)           Participations.  Any
Lender may at any time grant to an affiliate of such Lender, or one or more
banks or other financial institutions (each a “Participant” )
participating interests in its Commitment or the obligations owing to such
Lender hereunder.  No Participant shall
have any rights or benefits under this Agreement or any other Loan
Document.  In the event of any such grant
by a Lender of a participating interest to a Participant, such Lender shall
remain responsible for the performance of it obligations hereunder, and the
Borrower and the Administrative Agent shall continue to deal solely and
directly with such Lender in connection with such Lender’s rights and
obligations under this Agreement.  Any
agreement pursuant to which any Lender may grant such a participating interest
shall provide that such Lender shall retain the sole right and responsibility
to enforce the obligations of the Borrower hereunder including, without
limitation, the right to approve any amendment, modification or waiver of any
provision of this Agreement; provided  however, such Lender may
agree with the Participant that it will not, without the consent of the
Participant, agree to (i) increase such Lender’s Commitment, (ii) extend the
date fixed for the payment of principal on the Loan or a portion thereof owing
to such Lender, or (iii) reduce the rate at which interest is payable
thereon.  An assignment or other transfer
which is not permitted by subsection (c) below shall be given effect for purposes
of this Agreement only to the extent of a participating interest granted in
accordance with this subsection (b).


 


(c)           Assignments.  Any
Lender may with the prior written consent of the Administrative Agent and the
Borrower (which consent, in each case, shall not be unreasonably withheld) at
any time assign to one or more Eligible Assignees (each an “Assignee”) all or a
portion of its rights and obligations under this Agreement and the Notes;
provided, however, (i) no such consent by the Borrower shall be required (x) if
a Default shall exist or (y) in the case of an assignment to another Lender or
an affiliate of another Lender; (ii) any partial assignment shall be in an
amount at least equal to $5,000,000.00 and after giving effect to such
assignment the assigning Lender retains a Commitment, or if the Commitments
have been terminated, holds a Note having an outstanding principal balance, of
at least $5,000,000.00, and (iii) each such assignment shall be effected by
means of an Assignment and Assumption Agreement.  Upon execution and delivery of such
instrument and payment by such Assignee to such transferor Lender of an amount
equal to the purchase price agreed between such transferor Lender and such
Assignee, such Assignee shall be deemed to be a Lender party to this Agreement
and shall have all the rights and obligations of a Lender with a Commitment as
set forth in such Assignment and Assumption Agreement, and the transferor
Lender shall be released from its obligations hereunder to a corresponding extent,
and no further consent or action by any party shall be required.  Upon the consummation of any assignment
pursuant to this subsection (c), the transferor Lender, the Administrative
Agent and the Borrower shall make appropriate arrangement so the new Notes are
issued to the Assignee and such transferor Lender, as appropriate.  In connection with any such assignment, the
transferor Lender shall pay to the Administrative Agent an administrative fee
for processing such assignment in the amount of $4,500.00.  Anything in this Section to the contrary
notwithstanding, no Lender may assign or participate any interest in any Loan
held by it hereunder to the Borrower, or any of its respective Affiliates or
Subsidiaries.


 


(d)           Tax
Withholding.  At least five (5) Business Days prior to the first
day on which interest or fees are payable hereunder for the account of any
Lender, each Lender that is not incorporated under the laws of the United
States of America, or a state thereof, shall furnish the Administrative Agent
and Borrower with a properly completed executed copy of either Internal Revenue
Service Form W-8ECI or Internal Revenue Service Form W-8BEN and either Internal
Revenue Service Form W-8 or Internal Revenue Service Form W-9 and any
additional form (or such other form) as is necessary to claim complete
exemption from United States withholding taxes on all payments hereunder.  At all times each Lender shall own or
beneficially own a Note, such Lender shall (i) promptly provide to 


 


49

















 


the Administrative Agent and Borrower a new Internal Revenue Service
Form W-8ECI or Internal Revenue Service Form W-8BEN and Internal Revenue
Service Form W-8 or Internal Revenue Service Form W-9 and any additional form
(or such other form) (or any successor form or forms) upon the expiration or
obsolescence of any previously delivered form and comparable statements in
accordance with applicable United States laws and regulations and amendments
duly executed and completed by such Lender, and (ii) comply at all times with
all applicable United States laws and regulations, including all provisions of
any applicable tax treaty, with regard to any withholding tax exemption claimed
with respect to any payments on the Loan. 
If any Lender cannot deliver such form, then Borrower may withhold from
payments due under the Loan Documents such amounts as Borrower is able to
determine from accurate information provided by such Lender are required by the
Internal Revenue Code.


 


(e)           Federal
Reserve Bank Assignments.  In addition to the assignments and
participations permitted under the foregoing provisions of the Section, and
without the need to comply with any of the formal or procedural requirements of
this Section, any Lender may at any time and from time to time, pledge and
assign all or any portion of its rights under all or any of the Loan Documents
and Other Related Documents to a Federal Reserve Bank; provided that no such
pledge of assignment shall release such Lender from its obligation thereunder.


 


(f)            Information
to Assignee, Etc.  A Lender may furnish any information
concerning the Borrower, any subsidiary or any other Loan Party in the
possession of such Lender from time to time to Assignees and Participants
(including prospective Assignees and Participants).  In connection with such negotiation,
execution and delivery, Borrower authorizes Administrative Agent and Lenders to
communicate all information and documentation related to the Loan (whether to
Borrower or to any Participant, Assignee, legal counsel, appraiser or other
necessary party) directly by e-mail, fax, or other electronic means used to
transmit information.


 


11.14       CERTAIN ALLOWED DISCLOSURES.


 


Notwithstanding anything to the contrary set forth
herein or in any other written or oral understanding or agreement to which the
parties hereto are parties or by which they are bound, the parties hereto
acknowledge and agree that (i) any obligations of confidentiality contained
herein and therein do not apply and have not applied from the commencement of
discussions between the parties to the tax treatment and tax structure of the
transactions contemplated by the Loan Documents or Other Related Documents (and
any related transactions or arrangements), and (ii) each party (and each of its
employees, representatives, or other agents) may disclose to any and all
parties as required, without limitation of any kind, the tax treatment and tax
structure of the transactions contemplated by the Loan Documents and Other
Related Documents and all materials of any kind (including opinions or other
tax analyses) that are provided to such party relating to such tax treatment
and tax structure, all within the meaning of Treasury Regulations Section
1.6011-4; provided, however, that each party recognizes that the privilege each
has to maintain, in its sole discretion, the confidentiality of a communication
relating to the transactions contemplated by the Loan Documents and Other
Related Documents, including a confidential communication with its attorney or
a confidential communication with a federally authorized tax practitioner under
Section 7525 of the Internal Revenue Code, is not intended to be affected by
the foregoing.


11.15       CAPITAL ADEQUACY; ADDITIONAL COSTS.


 


(a)           If any Lender or any Participant or
Assignee in the Loan determines that compliance with any law or regulation or
with any guideline or request from any central bank or other governmental
agency (whether or not having the force of law) affects or would affect the
amount of capital required or expected to be maintained by such Lender, such
Participant or such Assignee, or any corporation controlling such Lender, such
Participant or such Assignee, as a consequence of, or with reference to, such
Lender’s, such Participant’s or such Assignee’s or such corporation’s
commitments or its making or maintaining advances below the rate which such
Lender, such Participant or such Assignee or such corporation controlling such
Lender, such Participant or such Assignee could have achieved but for such
compliance (taking into account the policies of such Lender, such Participant
or such Assignee 


 


50

















 


or corporation with regard to capital), then Borrower
shall, from time to time, within ninety (90) calendar days after written demand
by such Lender, such Participant or such Assignee, pay to such Lender, such
Participant or such Assignee additional amounts sufficient to compensate such
Lender, such Participant or such Assignee or such corporation controlling such
Lender, such Participant or such Assignee to the extent that such Lender, such
Participant or such Assignee determines such increase in capital is allocable
to such Lender’s, such Participant’s or such Assignee’s obligations
hereunder.  A certificate as to such
amounts, submitted to Borrower by such Lender, such Participant or such
Assignee, shall be conclusive and binding for all purposes, absent manifest
error.  Without limiting the obligations
of the Borrower under the this Section (but without duplication), if as a
result of any change in any law or regulation or with any guideline or request
from any central bank or other governmental agency (whether or not having the
force of law) there shall be imposed, modified or deemed applicable any tax,
reserve, special deposit, capital adequacy or similar requirement against or
with respect to or measured by reference to Letters of Credit and the result
shall be to increase the cost to the Administrative Agent of issuing (or any
Lender of purchasing participations in) or maintaining its obligation hereunder
to issue (or purchase participations in) any Letter of Credit or reduce any
amount receivable by the Administrative Agent or any Lender hereunder in
respect of any Letter of Credit, then, within ninety (90) calendar days after
written demand by the Administrative Agent or such Lender, the Borrower shall
pay immediately to the Administrative Agent for its account or the account of
such Lender, as applicable, from time to time as specified by the
Administrative Agent or a Lender, such additional amounts as shall be
sufficient to compensate the Administrative Agent or such Lender for such
increased costs or reductions in amount.


11.16       LENDER’S AGENTS.


 


Administrative Agent 
and/or any Lender may designate an agent or independent contractor to
exercise any of such Person’s rights under this Agreement, any of the other
Loan Documents and Other Related Documents. 
Any reference to Administrative Agent or any Lender in any of the Loan
Documents or Other Related Documents shall include Administrative Agent’s and
such Lender’s agents, employees or independent contractors.  Borrower shall pay the costs of such agent or
independent contractor either directly to such person or to Administrative
Agent or such Lender in reimbursement of such costs, as applicable.


11.17       TAX SERVICE.


 


Administrative Agent, on behalf of Lenders, is
authorized to secure, at Borrower’s expense, a tax service contract with a
third party vendor which shall provide tax information on the Property satisfactory
to Administrative Agent.


11.18       SEVERABILITY.


 


If any provision or obligation under this Agreement,
the other Loan Documents or Other Related Documents shall be determined by a
court of competent jurisdiction to be invalid, illegal or unenforceable, that
provision shall be deemed severed from the Loan Documents and the Other Related
Documents and the validity, legality and enforceability of the remaining
provisions or obligations shall remain in full force as though the invalid,
illegal, or unenforceable provision had never been a part of the Loan Documents
or Other Related Documents, provided, however, that if the rate
of interest or any other amount payable under the Notes or this Agreement or
any other Loan Document, or the right of collectibility therefor, are declared
to be or become invalid, illegal or unenforceable, Lenders’ obligations to make
advances under the Loan Documents shall not be enforceable by Borrower.


11.19       TIME.


 


Time is of the essence of each and every term of this
Agreement.


 


51

















 


11.20       HEADINGS.


 


All article, section or other headings appearing in
this Agreement, the other Loan Documents and Other Related Documents are for
convenience of reference only and shall be disregarded in construing this
Agreement, any of the other Loan Documents and Other Related Documents.


11.21       GOVERNING LAW.


 


This Agreement shall be governed by, and construed and
enforced in accordance with the laws of the State of California, except to the
extent preempted by federal laws. 
Borrower and all persons and entities in any manner obligated to Lender
under the Loan Documents and Other Related Documents consent to the
jurisdiction of any federal or state court within the State of California
having proper venue and also consent to service of process by any means
authorized by California or federal law.


11.22       USA PATRIOT ACT
NOTICE.  COMPLIANCE.


 


The USA Patriot Act of 2001 (Public Law 107-56) and
federal regulations issued with respect thereto require all financial institutions
to obtain, verify and record certain information that identifies individuals or
business entities which open an “account” with such financial institution.  Consequently, Lender (for itself and/or as
Agent for all Lenders hereunder) may from time-to-time request, and Borrower
shall provide to Lender, Borrower’s name, address, tax identification number
and/or such other identification information as shall be necessary for Lender
to comply with federal law.  An “account”
for this purpose may include, without limitation, a deposit account, cash
management service, a transaction or asset account, a credit account, a loan or
other extension of credit, and/or other financial services product.


11.23       ELECTRONIC DOCUMENT DELIVERIES.


 


Documents required to be delivered pursuant to the
Loan Documents shall be delivered by electronic communication and delivery,
including, the Internet, e-mail or intranet websites  to which the Administrative Agent and each
Lender have access (including a commercial, third-party website such as
www.Edgar.com <http://www.Edgar.com> or a website sponsored or hosted by
the Administrative Agent or the Borrower) provided that (A) the foregoing shall
not apply to notices to any Lender (or the Issuing Bank) pursuant to Article 3
and (B) the Lender has not notified the Administrative Agent or Borrower that
it cannot or does not want to receive electronic communications.   The Administrative Agent or the Borrower
may, in its discretion, agree to accept notices and other communications to it
hereunder by electronic delivery pursuant to procedures approved by it for all
or particular notices or communications. 
Documents or notices delivered electronically shall be deemed to have
been delivered twenty-four (24) hours after the date and time on which the
Administrative Agent or Borrower posts such documents or the documents become
available on a commercial website and the Administrative Agent or Borrower
notifies each Lender of said posting and provides a link thereto provided if
such notice or other communication is not sent or posted during the normal
business hours of the recipient, said posting date and time shall be deemed to
have commenced as of  9:00 a.m. on the
opening of business on the next business day for the recipient.  Notwithstanding anything contained herein, in
every instance the Borrower shall be required to provide paper copies of the
certificate required by Section 8.2(a) to the Administrative Agent and shall
deliver paper copies of any documents to the Administrative Agent or to any
Lender that requests such paper copies until a written request to cease
delivering paper copies is given by the Administrative Agent or such
Lender.  Except for the certificates
required by Section 8.2(a), the Administrative Agent shall have no obligation
to request the delivery of or to maintain paper copies of the documents
delivered electronically, and in any event shall have no responsibility to
monitor compliance by the Borrower with any such request for delivery.  Each Lender shall be solely responsible for
requesting delivery to it of paper copies and maintaining its paper or
electronic documents.


11.24       INTEGRATION; INTERPRETATION.


 


The Loan Documents and Other Related Documents contain
or expressly incorporate by reference the entire agreement of the parties with
respect to the matters contemplated therein and supersede all prior 


 


52

















 


negotiations or agreements, written or oral.  The Loan Documents and Other Related
Documents shall not be modified except by written instrument executed by all
parties.  Any reference to the Loan
Documents or Other Related Documents includes any amendments, renewals or
extensions thereof


11.25       JOINT AND SEVERAL LIABILITY.


 


The liability of all persons and entities obligated in
any manner under this Agreement, any of the Loan Documents or Other Related
Documents, other than Administrative Agent and/or Lenders, shall be joint and
several.


11.26       COUNTERPARTS.


 


To facilitate execution, this document may be executed
in as many counterparts as may be convenient or required. It shall not be
necessary that the signature of, or on behalf of, each party, or that the
signature of all persons required to bind any party, appear on each
counterpart.  All counterparts shall
collectively constitute a single document. 
It shall not be necessary in making proof of this document to produce or
account for more than a single counterpart containing the respective signatures
of, or on behalf of, each of the parties hereto.  Any signature page to any counterpart may be
detached from such counterpart without impairing the legal effect of the
signatures thereon and thereafter attached to another counterpart identical
thereto except having attached to it additional signature pages.


11.27       INTEREST RATE LIMITATION.


 


Notwithstanding anything to the contrary contained in
any Loan Document, the interest paid or agreed to be paid under the Loan
Documents shall not exceed the maximum rate of non-usurious interest permitted
by applicable law (the “Maximum Rate”). 
If the Administrative Agent or any Lender shall receive interest in an
amount that exceeds the Maximum Rate, the excess interest shall be applied to
the principal of the Loan or, if it exceeds such unpaid principal, refunded to
the Borrower.  In determining whether the
interest contracted for, charged, or received by the Administrative Agent or a
Lender exceeds the Maximum Rate, such Person may, to the extent permitted by
applicable law, (a) characterize any payment that is not principal as an expense,
fee, or premium rather than interest, (b) exclude voluntary prepayments and the
effects thereof, and (c) amortize, prorate, allocate, and spread in equal or
unequal parts the total amount of interest throughout the contemplated term of
the Obligations hereunder.


11.28       TREATMENT OF CERTAIN INFORMATION; CONFIDENTIALITY.


 


Each of the Administrative Agent and the Lenders agrees to maintain the
confidentiality of the Information (as defined below), except that Information
may be disclosed (a) to its Affiliates and to its and its Affiliates’
respective managers, administrators, trustees, partners, directors, officers,
employees, agents, advisors and other representatives (it being understood that
the Persons to whom such disclosure is made will be informed of the
confidential nature of such Information and instructed to keep such Information
confidential), (b) to the extent requested by any regulatory authority
purporting to have jurisdiction over it (including any self-regulatory
authority, such as the National Association of Insurance Commissioners), (c) to
the extent required by applicable laws or regulations or by any subpoena or
similar legal process, (d) to any other party hereto, (e) in connection with
the exercise of any remedies hereunder or under any other Loan Document or any
action or proceeding relating to this Agreement or any other Loan Document or
the enforcement of rights hereunder or thereunder, (f) subject to an agreement
containing provisions substantially the same as those of this Section, to (i)
any assignee of or participant in, or any prospective assignee of or
participant in, any of its rights or obligations under this Agreement or (ii)
any actual or prospective party (or its managers, administrators, trustees,
partners, directors, officers, employees, agents, advisors and other
representatives) to any swap or derivative or similar transaction under which
payments are to be made by reference  to
the Borrower and its obligations, this Agreement or payments hereunder, (iii)
any rating agency, or (iv) the CUSIP Service Bureau or any similar
organization, (g) with the consent of the Borrower or (h) to the extent such
Information (x) becomes publicly available other than as a result of a breach
of this Section or (y) becomes available to the Administrative Agent, any
Lender, or any of their respective Affiliates on a nonconfidential basis from a
source other than the 


 


53

















 


Borrower.  For purposes of this
Section, “Information” means all information received from the Borrower or any
of its Subsidiaries relating to the Borrower or any of its Subsidiaries or any
of their respective businesses, other than any such information that is
available to the Administrative Agent or any Lender on a nonconfidential basis
prior to disclosure by the Borrower or any of its Subsidiaries, provided that,
in the case of information received from the Borrower or any of its
Subsidiaries after the date hereof, such information is clearly identified at
the time of delivery as confidential. 
Any Person required to maintain the confidentiality of Information as
provided in this Section shall be considered to have complied with its
obligation to do so if such Person has exercised the same degree of care to
maintain the confidentiality of such Information as such Person would accord to
its own confidential information.


 


(REMAINDER OF PAGE
INTENTIONALLY LEFT BLANK)


 


 


54
















IN WITNESS WHEREOF, Borrower, Administrative Agent and
Lenders have executed this Agreement as of the date appearing on the first page
of this Agreement.


	
  “ADMINISTRATIVE
  AGENT”

  

  WELLS FARGO BANK, NATIONAL ASSOCIATION

  	
   

  	
  

  Administrative Agent’s Address:



  
	
   

  	
   

  	
  WELLS FARGO BANK, 

  
	
   

  	
   

  	
  NATIONAL ASSOCIATION

  
	
  By:

  	
  /S/ GUY C. CHURCHILL

  	
   

  	
  11601 Wilshire Boulevard

  
	
  Name:

  	
  GUY C. CHURCHILL

  	
   

  	
  17th Floor

  
	
  Its:

  	
  Assistant Vice President

  	
   

  	
  Los Angeles, California 90025

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Attention:

  	
   

  



 


S-1

















	
  “BORROWER”

  	
   

  	
   

  
	
   

  	
   

  	
  Borrower’s Address:

  
	
  MAUI LAND & PINEAPPLE COMPANY, INC., a

  	
   

  
	
  Hawaii corporation

  	
  P.O. Box 187

  
	
   

  	
   

  	
   

  	
  Kahului, Hawaii 96733

  
	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
  /S/ ROBERT I. WEBBER

  	
   

  	
  Attention: Dan Ligienza

  
	
   

  	
  Robert I. Webber, Chief Financial Officer

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
  /S/ FRED W. RICKERT

  	
   

  	
   

  
	
   

  	
  Fred W. Rickert, Vice President and

  	
   

  
	
   

  	
  Treasurer

  	
   

  
					



 


S-2

















	
  “LENDER”

  	
   

  	
   

  
	
   

  	
  Lender’s Address:

  
	
  WELLS FARGO BANK, NATIONAL ASSOCIATION

  	
   

  
	
   

  	
   

  	
  WELLS FARGO BANK,

  
	
  By:

  	
  /S/ GUY C. CHURCHILL

  	
   

  	
  NATIONAL ASSOCIATION

  
	
  Name:

  	
  GUY C. CHURCHILL

  	
   

  	
  11601 Wilshire Boulevard

  
	
  Its:

  	
  Assistant Vice President

  	
   

  	
  17th Floor

  
	
   

  	
   

  	
   

  	
  Los Angeles, California 90025

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Attention: William J. Steelman

  
					



 


S-3

















	
  “LENDER”

  	
   

  
	
   

  	
  Lender’s Address:

  
	
  AMERICAN AGCREDIT, PCA

  	
   

  
	
   

  	
   

  	
  5560 South Broadway

  
	
   

  	
   

  	
  Eureka, California 95503

  
	
  By:

  	
  /S/ VERN ZANDER

  	
   

  	
   

  
	
  Name:

  	
  VERN ZANDER

  	
   

  	
  Attention: Gary VanSchuyver, Vice President

  
	
  Title:

  	
  Vice President

  	
   

  	
   

  



 


S-4

















	
  “LENDER”

  	
   

  
	
   

  	
   

  	
  Lender’s Address:

  
	
  AMERICAN SAVINGS BANK, F.S.B.

  	
   

  
	
   

  	
   

  	
  P.O. Box 2300

  
	
   

  	
   

  	
  Honolulu, Hawaii 96804

  
	
  By:

  	
  /S/ WILLIAM RUSSELL

  	
   

  	
   

  
	
   

  	
  William Russell, Vice President

  	
  Attention: William Russell, Vice President

  



 


 


H-1