Document:

Prepared by MERRILL CORPORATION

Exhibit 10.46

 

 

CAPITAL NOTE

AGRP HOLDING CORP.

 

 

Dated:                  December

5, 2001

$14,477,419

 

 

AGRP HOLDING

CORP. (the “Company”) promises to pay to Affinity Group Thrift Holding Corp., a

Delaware corporation, or assigns (the “Payee”) the principal sum of Fourteen

Million Four Hundred Seventy-Seven Thousand Four Hundred Nineteen and 00/100

Dollars ($14,477,419).

 

1.                Interest.  The Payee shall be entitled to receive

interest from the date hereof at the rate of eleven percent (11%) per annum on

the principal amount of this Note outstanding from time to time.  Interest shall be paid at such times as

declared by the board of directors of the Company.  Interest not paid shall accumulate and shall be compounded

annually until paid.  All interest

accumulated under this section shall be paid in full before any distribution is

paid or declared to any member of the Company. 

If not earlier paid, all accrued and theretofore unpaid interest shall

be paid on the Maturity Date.  The

Company shall pay interest on overdue principal and on overdue interest (to the

full extent permitted by law) at a rate equal to fifteen percent (15%) per

annum.

 

2.                Principal.  The Payee shall be entitled to receive the

principal amount of this Note on the Maturity Date.

 

3.                Liquidation Preference.  In the event of any voluntary dissolution,

liquidation, partial liquidation or winding up of the Company, after due

payment or provision for payment of the other debts and other liabilities of

the Company, the Payee shall be entitled to receive from the net assets an

amount (the “Liquidation Payment”) equal to interest accumulated and unpaid

pursuant to Section 1 above plus the principal amount hereof, before any

distribution shall be made to any member of the Company.

 

4.                Pre-payment.

 

                A.                Voluntary Pre-payment.  The Company shall have the option of

prepaying this Note in whole or in part at any time and from time to time

without penalty or premium.  All

payments shall be applied first to accrued interest and then to principal

balances.

 

                B.                Mandatory Pre-payment. To

the extent of the Net Proceeds thereof, the Company shall prepay the principal

balance of this Note contemporaneously with the closing of a transaction

described in clause (iii), (iv) or (v) of the definition of Asset Sale. The

Company shall prepay the entire principal balance of this Note

contemporaneously with the occurrence of an event described in clauses (i) or

(ii) of the definition of Asset Sale. 

Prepayments shall be applied in inverse order of maturity.

 

 

5.                Defaults and Remedies.  An "Event of Default" occurs if:

 

      (a)   the

Company defaults in the payment of any principal, interest or premium, if any,

on the Note when the same becomes due and payable, or otherwise fails to comply

with any other provision of this Note and such default is not cured within five

business days after the occurrence thereof.

 

                (b)                the Company, pursuant to Title

11 of the U.S. Code or any similar federal or state law for the relief of

debtors as the same may be amended from time to time, (i) commences a voluntary

case or proceeding, (ii) consents to the entry of an order for relief against

it in an involuntary case or proceeding, (iii) consents to the appointment of a

receiver, trustee, assignee, liquidator, sequestrator or similar official

charged with maintaining possession or control over property for one or more

creditors, (iv) makes a general assignment for the benefit of its creditors, or

(v) generally does not pay its debts when such debts become due or admits in

writing its inability to pay its debts generally.

 

      If an Event of Default specified in

subparagraph (a) above occurs and is continuing, then the Payee may declare the

principal of and interest on the Note to be due and payable immediately.  If an Event of Default specified in

subparagraph (b) above occurs and is continuing, the principal of, and premium,

if any, and interest on the Note shall ipso facto become and be immediately due

and payable without any declaration or other act on the part of the Payee.  No course of dealing on the part of the Payee

nor any delay or failure on the part of the Payee to exercise any right shall

operate as a waiver of such right or otherwise prejudice the Payee’s rights,

powers and remedies.  If an Event of

Default occurs, the Company will pay to the Payee all costs and expenses,

including but not limited to reasonable attorneys' fees, incurred by the Payee

in collecting any sums due on this Note or in otherwise enforcing any of the

Payee’s rights, powers and remedies.

 

6.                Seniority.  The indebtedness evidenced by this Note,

including all principal, interest, premium, fees, costs and expenses payable by

the Company hereunder, shall be expressly junior and subordinate in right of

payment to any indebtedness of the Company for borrowed money which is

designated as senior indebtedness, whether secured or unsecured (the

"Senior Debt").  No payment of

principal of or interest on this Note shall be made if the Company is in

default, or such payment would result in a default, with respect to the Senior

Debt.  Upon any distribution of assets

of the Company, upon dissolution, winding-up, liquidation or reorganization of

the Company, whether in bankruptcy, insolvency or receivership proceedings, or

upon an assignment for the benefit of creditors, or any other marshalling of

the assets and liabilities of the Company, or otherwise, Senior Debt shall

first be paid in full, or provision made for such payment, in cash, before any

payment is made on account of the principal of and interest on this Note.

 

7.                Miscellaneous.

 

As used herein,

the following terms shall have the meanings given to them hereinbelow:

 

                “Maturity Date” means the tenth anniversary

of the date thereof or such earlier date on which the principal balance of this

Note shall become due and payable by the terms hereof, by acceleration or

otherwise.

 

                “Asset Sale” means:  (i) a voluntary or involuntary dissolution or winding up of the

Company; (ii) any capital reorganization or reclassification of the equity

interests of the Company or consolidation or merger of the Company with or into

another entity; (iii) a sale of any of the real property scheduled on Exhibits

A-1 through A-11 to that certain real estate purchase agreement dated as of

November 1, 2001 made between the Company, as buyer, and Affinity Group, Inc.,

as seller, (the “Real Property”) or the sale of shares of stock of any

subsidiary of the Company holding any Real Property (a “Real Estate Sub”) to an

unaffiliated entity; (iv) if theretofore transferred to an affiliate, (a) a

sale of any Real Property (or the shares of a Real Estate Sub) by such

affiliate to an unaffiliated entity, (b) a capital reorganization or

reclassification of the ownership of such affiliate, (c) the consolidation or

merger of such affiliate with or into another entity, (d) a distribution by

such affiliate including, without limitation, a distribution of any Real

Property, or (e) a voluntary or involuntary dissolution or winding up of such

affiliate; or (v) the declaration by the Company of any distribution, by

dividend or otherwise, of any Real Property or of a Real Estate Sub.

 

                                “Net

Proceeds” means the net amount of cash available to the Company from an Asset

Sale after the payment of all expenses incurred in connection with the Asset

Sale and after the making of such deposits, escrows or other payments as may be

required in connection with any indebtedness to which the Real Property is

subject.

 

                This Note is a contract made under the laws

of the state of California and the rights and obligations of the Company and

the Payee shall be construed, interpreted and enforced under the laws of such

state.

 

                This Note has not been registered under the

Securities Act of 1933, as amended, or the securities laws of the State of

California, or any other state.  This

note may not be sold, transferred or otherwise disposed of except pursuant to

an effective registration statement or appropriate exemption from registration

under the foregoing laws.  Accordingly,

this Note may not be sold, transferred or otherwise disposed of without (i) the

opinion of counsel satisfactory to the Company that such transfer may lawfully

be made without registration under the Federal Securities Act of 1933 and the

securities laws of the State of California or any other applicable state

securities laws; or (ii) such registration. 

This legend represents a restriction on transferability of this Note.

 

                IN WITNESS WHEREOF, the Company has caused this Note

to be duly executed as of the date first written above.

 

	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

  AGRP HOLDING CORP.

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

  By:

  	

  /s/

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

  Name:

  	

  Mark J. Boggess

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

  Title:

  	

  Senior Vice PresidentPrepared by MERRILL CORPORATION

Exhibit 10.1

PROMISSORY NOTE

 

 

	

  $50,000.00

  	

   

  	

  Phoenix, Arizona

  
	

   

  	

   

  	

  August 22, 2001

  
	

   

  	

   

  	

  Note Doc.08220150

  

 

 

 

FOR VALUED RECEIVED, and legally bound hereby, RRF LIMITED PARTNERSHIP

(“Maker”), a Delaware partnership, InnSuites Hospitality Trust, General

Partner, an Ohio real estate investment trust, having an office at 1615 East

Northern Avenue, Suite 102, Phoenix, Arizona 85020 hereby promises to pay to

the order of Rare Earth Development Company (“Payee”), an Arizona corporation,

1615 East Northern Avenue, Suite 102, Phoenix, Arizona 85020 or a such other

place as the holder hereof may from time to time designate in writing, the

principal sum of FIFTY THOUSAND AND 00/100 DOLLARS ($50,000.00), with interest

on the unpaid principal balance thereon from time to time outstanding, at the

rate of seven percent (7.00%) per annum, computed on a three hundred sixty

(360)-day year, to be due and payable in installments of principal and interest

as follows:

 

(A)                              Commencing

on July 15, 2002, one annual payment of accrued but unpaid interest on the

outstanding principal balance hereunder; and on July 15, 2002 (the “Maturity

date”), one payment in the amount of the then unpaid principal balance

hereunder and all sums and charges due and unpaid by Maker (collectively, the

“Note”).

 

(B)                                Upon

sale or refinance of hotel/s, half of net proceeds shall be made available at

option of hotel to prepay on this note.

 

Payments shall be applied first to any charges or sums (other than

principal and interest) due and payable by Maker, second to accrued and unpaid

interest on the principal balance hereof, and then to further reduce the

principal balance of this Note.

 

Maker shall gave the

right any time during the term of this Note to repay all or part of the unpaid

principal amount of the Note, together with any accrued and unpaid interest

thereon any other sums or charges due hereunder without any prepayment premium

or penalty.

 

Maker hereby waives for itself and, to the fullest extent not

prohibited by applicable law, for any subsequent lienor, any right Maker may

now or hereafter have under the doctrine of marshaling of assets or otherwise

which would require Payee to proceed against certain property before proceeding

against any other property.

Maker hereby agrees that

in the event part of principal or interest is not paid when due or the entire

Note is not paid when due, then the rate of interest on this Note shall, at the

election of Payee upon ten (10) days prior written notice, each of which is

hereby expressly waived, be increased to nine and 00/100 percent (9.00%) per

annum or the highest rate for which the parties may agree under applicable law,

whichever is less (the “Default Rate”). Maker shall be obligated thereafter to

pay interest on the then unpaid principal balance of the Note at the Default

Rate, both before and after judgment, to be computed from the due date through

and including the date of actual receipt of the overdue payment, whether a

payment of interest or the entire Note. 

Nothing herein shall be construed as an agreement or privilege to extend

the date of the payment or any installment or the entire Note, or as a wavier

of any other right or remedy accruing to Payee.

 

In the event that any regular payment of interest herein provided shall

not be received by Payee on the date such payment is due, Payee shall have the

right to assess Maker a late payment charge in the amount of two percent (2.0%)

of such overdue quarterly installment, which shall become immediately due to

Payee for the additional cost agreed compensation to Payee for the additional

costs and expenses reasonable expected to be incurred by Payee by reason of

such nonpayment.  Maker acknowledges

that the exact amount of such cost and expenses may be difficult, if not impossible,

to determine with certainty, and further acknowledges and confesses the amount

of such charge to be a consciously considered, good faith estimate of the

actual damage to Payee by reason of such default.  The Default Rate will only accrue for periods of delinquent

installments except for such when Payee accepts late payments of installments

accompanied by a late payment charge as specified above.

 

Upon any of the following Events of Default, at the election of Payee,

the entire unpaid principle balance of the Note, together with all accrued but

unpaid interest thereon at the Default Rate and all other sums or changes due

hereunder, shall become due and payable:

 

(a)                                  Maker’s

failure to pay when due any installment required to be paid hereunder, on or

before the tenth (10th) day following the applicable due date;

 

(b)                                 Maker’s

failure to pay when due any other payment required to be under this Note,

subject to any notice and applicable grace period, if any;

 

(c)                                  Maker’s

breach of any other covenant or agreement herein and such breach remains uncorrected

at the expiration of any applicable grace period expressly provided for herein;

 

(d)                                 Any

creditor’s proceeding in which Maker consents to the appointment or a receiver

or trustee for any of its property;

(e)                                  if

any order, judgment or decree shall be entered, without the consent of Maker,

upon an application of a creditor approving the appointment of a receiver or

trustee for any of its property, and such order, judgment, decree, or

appointment is not dismissed or stayed with an appropriate appeal bond within

sixty (60) days following the entry or rendition thereof; or

 

(f)                                    if

Maker (i) makes a general assignment for the benefit of creditors, (ii) fails

to pay its debts generally as such debts become due, (iii) is found to be

insolvent by a court of competent jurisdiction, (iv) voluntarily files a

petition in bankruptcy or a petition or answer seeking readjustment of debts

under any state or federal bankruptcy or like law, or (v) any such petition is

filed against Maker and is not vacated or dismissed within sixty (60) days

after filling thereof.

 

Notice of such election by Payee is hereby expressly waived as part of

the consideration for this loan. 

Nothing contained herein shall be construed to restrict the exercise of

any other rights or remedies granted to Payee hereunder upon the failure of

Maker to perform any provision hereof.

 

If this Note is not paid when due, whether at maturity or by

acceleration, Maker promises to pay all costs incurred by Payee, including

without limitation reasonable attorney’s fees to the fullest extent not

prohibited by law, and all expenses incurred in connection with the protection

or realization of any collateral, whether or not suit is filed hereon or on any

instrument granted a security interest.

 

Maker hereby expressly acknowledges and represents that the

indebtedness is for a business purpose and not consumer or household purposes.

 

Maker hereby waves demand, presentment for payment, protest, notice of

protest, notice of non-payments and any and all lack of diligence or delays in

collection or enforcement of this Note, and expressly consents to any extension

of time of payment hereof, release of any party primarily or secondarily liable

hereunder or any of the security for this Note, acceptance of other parties to be

liable for any of the Note or of other security therefore, or any other

indulgence or forbearance which may be made, without notice to any party and

without in any way affecting the liability of any party.

 

No failure by Payee to exercise any right hereunder shall be construed

as a waiver of the right to exercise the same or any other right any time or

from time to time thereafter.

This Note shall be construed and enforced according to, and governed by

the laws of the State of Arizona.

 

Any notice required hereunder shall be in

writing, and shall be given to the receiving party the notice by personal

delivery or be certified mail, postage prepaid, return receipt requested, as

follows:

 

                if

to Payee, then addressed to Payee at 1615 East Northern Avenue Suite 102,

Phoenix, Arizona 85020, (Tel.(602) 944-1500, Fax (602) 678-0281, with a copy to

James W. Reynolds, Esq., Dillingham Cross, P.L.C., 5080 North 40th

Street, Suite 335, Phoenix, Arizona 85018, (Tel.(602) 468-1811, Fax (602)

468-0442);

 

                if

to Maker, then addressed to maker at 1615 East Northern Avenue, Suite 102,

Phoenix, Arizona 85020, Attn: President (Tel.(602) 944-1500, Fax (602)

678-0281), with a copy to James B. Aronoff, Esq., Thompson Hine & Flory,

LLP, 3900 Key center, 127 Public Square, Cleveland, Ohio 44114 (Tel.(216)

566-5500, Fax (216) 566-5800).

 

Any party may, be given notice in writing

to designate another address as a place for service of notice. Such notices

shall be deemed to be received when delivered, if delivered in person, or seven

(7) business days after deposited in the United States mails, if mailed as

herein above provided.

 

By acceptance of this Note, Payee agrees

that, upon payment in full of the then unpaid principal balance of this Note,

together with all unpaid interest and other sums payable to Payee under this

Note, (a) Note shall be fully satisfied, (b) Payee shall promptly mark this

Note as being paid in full, satisfied and discharged and shall return the same

to Maker.

 

 

	

   

  	

  RRF LIMITED PARTNERSHIP, a

  
	

   

  	

  Delaware limited partnership,

  
	

   

  	

  InnSuites Hospitality Trust, General

  Partner,

  an Ohio real estate investment trust

  
	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  
	

   

  	

  By:

  	

  /s/ Marc E. Berg

  	 

	

   

  	

   

  	

  Name: Marc E. Berg

  
	

   

  	

   

  	

  Title: 

  Executive Vice-President

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