Exhibit 10.43


 


Loan
No. 105088


 


THIRD
MODIFICATION AGREEMENT


Secured Loan


 


THIS THIRD MODIFICATION
AGREEMENT (“Agreement”) dated as of March 27, 2009, is entered into 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 signatory to the Loan Agreement (as defined below) (“Lenders”),
and WELLS FARGO BANK, NATIONAL ASSOCIATION (“Wells Fargo”) as
Administrative Agent under the Loan Agreement (in such capacity, the “Administrative
Agent”).


 


R E C I T
A L S


 


A.    Pursuant to the
terms of a loan agreement between Borrower and Lender dated November 13,
2007 (“Loan Agreement”), Lenders made a loan to Borrower in the principal
amount of NINETY MILLION AND NO/100THS DOLLARS ($90,000.000.00) (“Loan”). The
Loan is evidenced by promissory notes dated as of the date of the Loan
Agreement, executed by Borrower in favor of each Lender, in the aggregate
principal amount of the Loan (“Note”), and is further evidenced by the documents
described in the Loan Agreement as “Loan Documents.” The Note is secured by,
among other things, a Fee and Leasehold Mortgage with Absolute Assignment of
Leases and Rents, Security Agreement and Fixture Filing dated as of November 13,
2007, executed by Borrower and Leasehold Mortgagor, collectively as Mortgagor,
and Administrative Agent, for the benefit of Lenders, as Mortgagee (“Mortgage”).
The Mortgage was recorded on November 15, 2007, as Instrument or Document No. 2007-199589,
in the Bureau of Conveyances of the State of Hawaii.  All capitalized terms used herein, which are
not defined herein, shall have the meanings given to them in the other Loan
Documents.


 


B.    The Note, Deed of
Trust and Loan Agreement have been previously amended and modified by
modification agreements dated November 7, 2008 and March 3, 2009.


 


C.    The Note,
Mortgage, Loan Agreement, this Agreement, the other documents described in the
Loan Agreement as “Loan Documents”, together with all modifications and
amendments thereto and any document required hereunder, are collectively
referred to herein as the “Loan Documents.”


 


D.    By this
Agreement, Borrower, Administrative Agent and Lenders intend to modify and
amend certain terms and provisions of the Loan Documents.


 


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


 


1.                             CONDITIONS PRECEDENT. The following
are conditions precedent to Administrative Agent and Lenders’ obligations under
this Agreement:


 


1.1        If required by
Administrative Agent, receipt and approval by Administrative Agent of a date
down to the Title Policy and assurance acceptable to Administrative Agent,
including, without limitation, CLTA Endorsement No. 110.5, without
deletion or exception other than those expressly approved by Administrative
Agent in writing, that the priority and validity of the Mortgage has not been
and will not be impaired by this Agreement or the transactions contemplated
hereby;


 


1.2        Receipt by Administrative
Agent of the executed originals of this Agreement, the short form of this
Agreement (if any) and any and all other documents and agreements which are
required by this Agreement or by any other Loan Document, each in form and
content acceptable to Administrative Agent;


 


1.3        If required by
Administrative Agent, recordation in the Bureau of Conveyances of the State of
Hawaii of (i) the short form of this Agreement (if any), and (ii) any
other documents which are required to be recorded by this Agreement or by any
other Loan Document (if any);


 


1.4        Reimbursement to Administrative
Agent by Borrower of Administrative Agent’s costs and expenses incurred in
connection with this Agreement and the transactions contemplated hereby,
including, without limitation, title insurance costs, recording fees, attorneys’
fees, appraisal, engineers’ and inspection fees and 


 


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documentation
costs and charges, whether such services are furnished by Administrative Agent’s
employees or agents or by independent contractors;


 


1.5        The representations and
warranties contained in this Agreement are true and correct;


 


1.6        Borrower shall have paid
to Administrative Agent (i) for the ratable benefit of Lenders a
modification fee equal to 0.20% of the Credit Limit (after reduction by the
amount of the Plantation Golf Course Release Price) and (ii) for the sole
benefit of Administrative Agent, certain other fees, each in the amount and at
the times as set forth in a separate letter agreement between Borrower and
Administrative Agent dated March 19, 2009;


 


1.7        All conditions precedent
to the Plantation Golf Course Release (as defined, and as such conditions are
set forth, in Section 3.2 below) have been satisfied; and


 


1.8        All payments due and owing
to Administrative Agent and Lenders under the Loan Documents have been paid
current as of the effective date of this Agreement.


 


2.                             REPRESENTATIONS AND WARRANTIES.  Borrower hereby represents and warrants that
no Default, Potential Default, breach or failure of condition has occurred, or
would exist with notice or the lapse of time or both, under any of the Loan
Documents (as modified by this Agreement) and that all representations and
warranties herein and in the other Loan Documents are true and correct, which
representations and warranties shall survive execution of this Agreement.


 


3.                             MODIFICATION OF LOAN DOCUMENTS.  The Loan Documents are hereby supplemented
and modified to incorporate the following, which shall supersede and prevail
over any conflicting provisions of the Loan Documents:


 


3.1        Interest
Rate.  In order to reflect
the agreement of the parties to modify the definition of “Applicable LIBO Rate,”
“Indebtedness” and “Variable Rate,” and to add definitions of “LIBOR Market
Index Rate,” “Restricted Payments” and “Disposition,” such definitions are
amended or added to read as follows, with changes in the Effective Rate
applicable under the Loan to be effective as of April 1, 2009:


 


“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) four
and one-quarter percent (4.25%) plus (b) the LIBO Rate, which rate
is divided by one (1.00) minus the Reserve Percentage:


 


	
  Applicable LIBO Rate = 4.25%

  	
   

  	
  +

  	
  LIBO Rate

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  (1 - Reserve
  Percentage)

  	
   

  	
   

  



 


“Disposition” means the sale, transfer,
license, lease or other disposition (including any sale and leaseback
transaction) of any property by any Person, including any sale, assignment,
transfer or other disposal, with or without recourse, of any notes or accounts
receivable or any rights and claims associated therewith.


 


“Indebtedness”
means, as to any Person at a particular time, without duplication, all items of
indebtedness which, in accordance with GAAP and industry practices, would be
included in determining liabilities as shown on the liability side of a balance
sheet of such Person as of the date as of which indebtedness is to be
determined, including, without limitation, all obligations for money borrowed
and capitalized lease obligations, and shall also include all indebtedness and
liabilities of any other Person assumed or guaranteed by such Person or in
respect of which such Person is secondarily or contingently liable (other than
by endorsement of instruments in the course of collection) whether by reason of
any agreement to acquire such indebtedness or to supply or advance sums or
otherwise.


 


 “LIBOR Market Index Rate” means at
any time the rate of interest, rounded up to the nearest whole multiple of
one-hundredth of one percent (.01%), obtained by dividing (i) the rate of
interest, rounded upward to the nearest whole multiple of one-sixteenth of one
percent (0.0625%), quoted by the Administrative Agent from time to time as the
London Inter-Bank Rate for one-month deposits in U.S. Dollars at approximately
9:00 a.m. Pacific time for such day; provided, if such day is not a
Business Day, the immediately preceding Business Day by (ii) a
percentage equal to 1 minus the stated maximum rate (stated as a
decimal) of all reserves, if any, required to be maintained with respect to
Eurocurrency funding (currently referred to as “Eurocurrency liabilities”) as
specified in Regulation D of the Board of Governors, of the Federal
Reserve System (or against any other category of liabilities which includes
deposits by reference to which the interest rate on LIBOR loans is determined
or any applicable category of extensions of credit or other assets which
includes loans by 


 


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an office of any Lender
outside of the United States of America).  Any change in such maximum rate
shall result in a change in the LIBOR Market Index Rate on the date on which
such change in such maximum rate becomes effective.


 


“Restricted Payment”
means any dividend or other distribution (whether in cash, securities or other
property) with respect to any capital stock or other equity interest of
Borrower or any Subsidiary, or any payment (whether in cash, securities or
other property), including any sinking fund or similar deposit, on account of
the purchase, redemption, retirement, acquisition, cancellation or termination
of any such capital stock or other equity interest or of any option, warrant or
other right to acquire any such capital stock or other equity interest.


 


“Variable Rate” shall mean
the sum of: (a) the LIBOR Market Index Rate and, (b) four and
one-quarter percent (4.25%); provided, that if for any reason the LIBOR Market
Index Rate is unavailable, Variable Rate shall mean the sum of: (a) the
Federal Funds plus 1.50% and (b) four and one-quarter percent (4.25%).


 


3.2        Plantation
Golf Course Release. 
Administrative Agent shall, at Borrower’s request, release from the lien
of the Mortgage (the “Plantation Golf Course Release”) the property described
on Exhibit A attached hereto (the “Plantation Golf Course”);
provided, however, that immediately prior to or simultaneously with such
partial release 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 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;


 


(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 Mortgage; and


 


(e)        Administrative Agent shall
have received in immediately available funds for the ratable benefit of the
Lenders the Plantation Golf Course Release Price.  As used herein, the “Plantation Golf Course
Release Price” shall mean the sum of $45,000,000.00.  The Plantation Golf Course Release Price
shall be applied for the ratable benefit of the Lenders to reduce outstanding
principal under the Loan and the Credit Limit shall be permanently reduced by
the amount of the Plantation Golf Course Release Price.


 


Neither the acceptance
of any payment nor the issuance of any partial release 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.


 


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3.3        Financial
Covenants.  In order to
reflect the agreement of the parties to modify the financial covenants provided
in the Loan Agreement, Section 7.12 is amended to read in its entirety as
follows:


 


7.12               FINANCIAL COVENANTS.


 


(a)           Reserved.


 


(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 and shall not permit any
Subsidiary to create, incur, assume or suffer to exist any Indebtedness, except
for Indebtedness disclosed on the consolidated balance sheet of Borrower and its
Subsidiaries dated as of December 31, 2008; provided, however, that (i) Indebtedness
incurred in connection with leases of golf carts and (ii) an increase in
the amount of Indebtedness attributable to convertible debt of the Borrower
arising solely from the recalculation of the amount of such debt under GAAP
based on a change in the stock price of shares of the Borrower (and not as a
result of issuance of new debt) shall not be considered an incurrence of
Indebtedness hereunder.


 


(d)           Reserved.


 


(e)           Restricted Payments.  Borrower shall not, and shall not permit any
Subsidiary to, declare or make, directly or indirectly, any Restricted Payment,
or incur any obligation (contingent or otherwise) to do so.


 


(f)            Dispositions.  Borrower shall not, and shall not permit any
Subsidiary to, make any Disposition or enter into any agreement to make any
Disposition, except:


 


(i)         Dispositions of obsolete
or worn out property, whether now owned or hereafter acquired, in the ordinary
course of business;


 


(ii)        Dispositions of inventory
in the ordinary course of business; and


 


(iii)       Dispositions approved in
writing by the Administrative Agent in its sole discretion.


 


3.4        Extension.  The Maturity Date is hereby extended to March 13,
2010;


 


3.5        Fixed
Rate Period. 
Notwithstanding anything to the contrary in the Loan Documents, a two (2) month
Fixed Rate Period will no longer be available and the definition of “Fixed Rate
Period” and Exhibit F to the Loan Agreement are hereby modified to delete
any reference to a Fixed Rate Period of two (2) months.


 


4.          WAIVER.  Lenders hereby waive (the “Waiver”) until June 30,
2009, any Default arising under Section 8.1(a)(ii) of the Loan
Agreement arising solely by virtue of the subjection of the report and opinion
of the auditors of the Borrower for the fiscal year ending on or about December 31,
2008, to a “going concern” or like qualification (the “Waived Default”).  Borrower understands, acknowledges and agrees
(a) that the Waiver is limited to the specific Default described above and
that the Lenders have not waived any other Defaults or Potential Defaults, (b) that
the effective period of the Waiver will expire automatically and without notice
immediately upon the earlier of the date designated above or the occurrence of
any other Default or Potential Default and, upon such expiration,
Administrative Agent and Lenders shall have all rights and remedies provided
under the Loan Documents and applicable law with respect to the Waived Default;
and (c) Lenders have not agreed to extend the duration of the Waiver
granted herein beyond the date designated above or to grant any additional
waivers of, or forbear with respect to, any other Default.


 


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5.          LENDER
CONSENT.  Each Lender
hereby consents to the transactions contemplated hereby and authorizes the
Administrative Agent to execute and deliver all documents which are necessary
and desirable to accomplish same or as otherwise contemplated under the sale,
purchase and escrow agreement relating to the sale of the Plantation Golf
Course including, without limitation, a partial release of mortgage, amendment
to UCC financing statement, a consent to and nondisturbance and attornment
agreement relating to a maintenance facilities easement being granted over the
Collateral in favor of the purchaser of the Plantation Golf Course, an
amendment to Water Delivery Agreement, a right of first offer in favor of the
purchaser of the portion of the Property more commonly known as the Bay Golf
Course,  and a consent to an agreement regarding
Kapalua Club.


 


6.          FORMATION
AND ORGANIZATIONAL DOCUMENTS. 
Borrower has previously delivered to Administrative Agent all of the
relevant formation and organizational documents of Borrower, of the partners or
joint venturers of Borrower (if any), and of all guarantors of the Loan (if
any), and all such formation documents remain in full force and effect and have
not been amended or modified since they were delivered to Administrative Agent.
Borrower hereby certifies that: (i) the above documents are all of the
relevant formation and organizational documents of Borrower; (ii) they
remain in full force and effect; and (iii) they have not been amended or
modified since they were previously delivered to Administrative Agent.


 


7.          NON-IMPAIRMENT.  Except as expressly provided herein, nothing
in this Agreement shall alter or affect any provision, condition, or covenant
contained in the Note or other Loan Document or affect or impair any rights,
powers, or remedies of Administrative Agent or Lenders, it being the intent of
the parties hereto that the provisions of the Note and other Loan Documents
shall continue in full force and effect except as expressly modified hereby.


 


8.          MISCELLANEOUS.  The headings used in this Agreement are for
convenience only and shall be disregarded in interpreting the substantive
provisions of this Agreement.  Time is of
the essence of each term of the Loan Documents, including this Agreement. If
any provision of this Agreement or any of the other Loan Documents shall be
determined by a court of competent jurisdiction to be invalid, illegal or
unenforceable, that portion shall be deemed severed from this Agreement and the
remaining parts shall remain in full force as though the invalid, illegal, or
unenforceable portion had never been a part thereof.


 


9.          INTEGRATION;
INTERPRETATION. The Loan Documents, including this Agreement,
contain or expressly incorporate by reference the entire agreement of the
parties with respect to the matters contemplated therein and supersede all
prior negotiations or agreements, written or oral. The Loan Documents shall not
be modified except by written instrument executed by all parties. Any reference
to the Loan Documents includes any amendments, renewals or extensions now or
hereafter approved by Administrative Agent and Lenders in writing.


 


10.        EXECUTION
IN 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.


 


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IN WITNESS WHEREOF, Borrower, Administrative Agent and
Lenders have caused this Agreement to be duly executed as of the date first
above written.


 


	
   

  	
  “ADMINISTRATIVE
  AGENT AND LENDER”

  
	
   

  	
   

  	
   

  
	
   

  	
  WELLS FARGO BANK,
  NATIONAL ASSOCIATION  

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Guy Churchill

  
	
   

  	
  Name:

  	
  Guy Churchill

  
	
   

  	
  Title:

  	
  Vice President

  
				



 


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  “LENDER”

  
	
   

  	
   

  
	
   

  	
  AMERICAN SAVINGS BANK, F.S.B.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ William
  Russell

  
	
   

  	
  Name:

  	
  William Russell

  
	
   

  	
  Title:

  	
  Vice President

  



 


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  “LENDER”

  
	
   

  	
   

  
	
   

  	
  AMERICAN AGCREDIT, PCA

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Gary Van Schuyver

  
	
   

  	
  Name:

  	
  Gary Van Schuyver

  
	
   

  	
  Title:

  	
  Vice President

  



 


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  “BORROWER”

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  MAUI LAND & PINEAPPLE
  COMPANY, INC., a

  Hawaii corporation 

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Warren H. Haruki

  
	
   

  	
  Name:

  	
  Warren H. Haruki

  
	
   

  	
  Title:

  	
  Chairman

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Adele H. Sumida

  
	
   

  	
  Name:

  	
  Adele H. Sumida

  
	
   

  	
  Title:

  	
  Controller & Secretary

  



 


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LEASEHOLD MORTGAGOR’S CONSENT


 


The undersigned (“Leasehold
Mortgagor”) consents to the foregoing Third Modification Agreement and the
transactions contemplated thereby and reaffirms its obligations under the Fee
and Leasehold Mortgage with Absolute Assignment of Leases and Rents, Security
Agreement and Fixture Filing (“Mortgage”) dated as of November 13, 2007,
and its waivers, as set forth in the Mortgage, of each and every one of the
possible defenses to such obligations. Leasehold Mortgagor further reaffirms
that its obligations under the Mortgage are separate and distinct from Borrower’s
obligations.


 


 


Dated as of:  March 25, 2009


 


	
   

  	
  “LEASEHOLD
  MORTGAGOR”

  
	
   

  	
   

  
	
   

  	
  KAPALUA LAND COMPANY, LTD.,

  
	
   

  	
  a Hawaii corporation

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Thomas J. Selby

  
	
   

  	
  Name:

  	
  Thomas J. Selby

  
	
   

  	
  Title:

  	
  Vice President

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Adele H. Sumida

  
	
   

  	
  Name:

  	
  Adele H. Sumida

  
	
   

  	
  Title:

  	
  Controller &
  Secretary

  



 


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