EXHIBIT 10.12.b
RESTATED AMENDMENT
TO Amended and Restated Credit Agreement
(WITH SECURITY AGREEMENT)
This RESTATED AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT
(WITH SECURITY AGREEMENT) (this "Amendment"), dated as of February 26, 1999 (the
"Restatement Date"), is made by and between CAPITAL TRUST, INC., a Maryland
corporation having an office at ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇
▇▇▇▇▇, as borrower (the "Borrower"), and GERMAN AMERICAN CAPITAL CORPORATION, a
Maryland corporation having an office at ▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇
▇▇▇▇▇, as lender and secured party hereunder (the "Lender"), and also for the
benefit of DEUTSCHE BANK AG, NEW YORK BRANCH, having an office at ▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, as an additional secured party hereunder (the
"Bank").
R E C I T A L S
WHEREAS, as of January 1, 1998 Lender entered into an Amended and
Restated Credit Agreement (the "Original Credit Agreement") between Lender and
Capital Trust, a California business trust ("Old Capital Trust"), pursuant to
which Lender agreed, subject to the terms and conditions set forth in the
Original Credit Agreement, to make a loan to Old Capital Trust, by making a
series of Advances, as provided in the Original Credit Agreement;
WHEREAS, all definitions in the Original Credit Agreement shall
apply in this Amendment except where this Amendment redefines any term(s);
WHEREAS, Lender and Old Capital Trust entered into previous
amendments dated June 22, 1998, and July 23, 1998, relating to the Original
Credit Agreement (the "Superseded Amendments");
WHEREAS, Borrower has succeeded to all the assets and liabilities
of Old Capital Trust, including the Original Credit Agreement, and Lender has no
objection to the foregoing;
WHEREAS, the parties now desire to replace the Superseded
Amendments with a single restated Amendment to the Original Credit Agreement to
implement the modifications previously agreed to, to provide for the transition
from Old Capital Trust to Borrower, and to address certain other matters;
WHEREAS, simultaneously herewith Borrower is executing and
delivering to Lender a Global Note (Amended and Restated), amended and restated
as of the Restatement Date, evidencing the obligation of Borrower to repay the
Loan, a copy of which is attached as Exhibit "A" (the "Restated Note"); and
WHEREAS, Borrower has requested, and Lender has agreed, to allow a
portion of the Loan and a portion of the Collateral for the Loan to secure, in
addition to the Secured Obligations as defined in the Original Credit Agreement,
certain obligations of Borrower with respect to certain contractual arrangements
made by Borrower's subsidiary, CT-BB Funding Corp., a Delaware corporation (the
"BB Sub"), for the benefit of Bank.
NOW, THEREFORE, in consideration of Ten Dollars ($10.00) and other
good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree that the foregoing recitals are hereby
incorporated into the operative provisions of this Amendment and further agree
as follows, effective as of the Restatement Date:
1. Assumption.
1.1. Borrower hereby assumes all obligations (past, present, and
future) of Old Capital Trust under the Original Credit Agreement (including the
Loan), which agreement is intended to be a security agreement, and under all
Security Documents and other documents relating to the Loan previously executed
and delivered by Old Capital Trust, other than the Superseded Amendments, which
amendments are intended to be entirely amended, restated and superseded by the
execution and delivery of this Amendment. The Superseded Amendments are no
longer of any force or effect. All Security Documents shall continue to secure
the Loan. Borrower shall execute and deliver such additional documents,
certificates, notices, agreements, financing statements and other deliveries as
Lender's counsel shall reasonably require from time to time to confirm and
further evidence Borrower's assumption of and joinder in all documents referred
to in this paragraph other than the Superseded Amendments.
1.2. On or before the Restatement Date, Borrower shall execute and
deliver to Lender the Restated Note, which is intended to constitute a
reaffirmation and continuation of the indebtedness evidenced by the previous
Global Note and is not intended to constitute new indebtedness or a "novation."
All references to the Global Note in the Original Credit Agreement and the
Security Documents shall mean and refer to the Restated Note, but the foregoing
shall not limit or terminate any obligations of Old Capital Trust under the
former Global Note.
1.3. Borrower shall, promptly upon Lender's request from time to time,
execute new UCC-1 financing statements and other Security Documents for all
Collateral, consistent with the UCC-1 financing statements and other Security
Documents previously obtained by Lender for all Collateral and/or, at Lender's
option, it is understood that Lender intends to file UCC "change" statements to
reflect the change of Borrower from Old Capital Trust to "Capital Trust, Inc."
Any UCC financing statements executed and delivered pursuant to this paragraph
shall name Lender and/or Bank, as determined by Lender. To the extent that any
such financing statements name only Lender as secured party, such financing
statements are intended to perfect all security interests granted under this
Agreement, whether in favor of Lender or Bank or both of them, whether or not
such financing statements specifically identify Lender and/or Bank as secured
party(ies) therein. There is no need for any financing statement to identify
Bank as an additional secured party, as identification of Lender alone would not
be misleading and shall be sufficient for all purposes.
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1.4. All references to Borrower in the Original Credit Agreement and
the Security Documents shall mean and refer to Borrower as defined in this
Amendment, but this shall not be deemed to release Old Capital Trust from any
obligations under the Original Credit Agreement.
2. Commitment.
2.1. The first paragraph of the Recitals on page 1 of the Original
Credit Agreement is hereby deleted in its entirety and replaced by the following
paragraph:
WHEREAS, Borrower desires to obtain a series of loan advances
(each, an "Advance" and collectively, the "Loan") from Lender (as
defined below) in an aggregate amount at any time outstanding of up to
$355,000,000 to provide warehouse funding for a portion of the
principal amount of the Collateral Loans and other Collateral (each as
hereinafter defined) that Borrower or its Acquisition Entities
originates or acquires, as the case may be; and
3. Certain Definitions.
The following defined terms in the Original Credit Agreement
are added or modified, as applicable, as follows:
"Advance" means, for any Asset, from time to time: (a) an
Advance, as defined in the Original Credit Agreement, related to such
Asset; plus (b) from and after any Swap Termination Event, the
Asset-Specific Swap Termination Advance (if made by Lender) for such
Asset.
"Advance Rate" means, for any Asset, the ratio of (a) the sum
of (i) the related Asset-Specific Loan Balance plus (ii) Seventy
Percent (70%) of the Asset-Specific Swap Collateral Amount to (b) the
related Asset Value. Only item (a)(i) represents an actual Advance by
Lender pursuant to this Agreement. Item (a)(ii) applies solely for
purposes of calculating a deemed Advance Rate (and corresponding LIBOR
Spread) for each individual Asset, and shall not be considered for
purposes of determining any (i) Drawdown Fee or principal of the Loan
(unless and until Lender actually makes any Swap Termination Advance),
(ii) Extension Fee (if any), or (iii) Loan Fee (to the extent, if any,
hereafter payable).
"Asset" means an individual item of Collateral as to which
Lender made an Advance (including Advances Lender made to Old Capital
Trust under the Original Credit Agreement and not heretofore repaid),
unless and until such Collateral has been released by Lender in
accordance with this Agreement.
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"Asset-Specific Line Availability" means, from time to time,
for each Asset, an amount equal to the following, as determined by
Lender from time to time: (a) the Maximum Advance Rate times the Asset
Value for such Asset minus (b) the Asset-Specific Loan Balance for such
Asset.
"Asset-Specific Loan Balance" means, from time to time, for
each Asset: (a) the Asset-Specific Loan Balance as defined in the
Original Credit Agreement; plus (b) the amount of any Asset-Specific
Swap Termination Advance (when and as advanced by Lender).
"Asset-Specific Swap Collateral Amount" means, for each
Asset, the amount designated as "Asset-Specific Swap Collateral Amount"
in the most recent valid Designation Notice.
"Asset-Specific Swap Termination Advance" means, for each
Asset, a portion of the Swap Termination Advance (if and when made by
Lender) equal to (a) the Asset-Specific Swap Collateral Amount for such
Asset as in effect immediately before the making of such Swap
Termination Advance times (b) a fraction whose numerator is the Swap
Termination Advance and whose denominator is the entire Swap Collateral
Amount as in effect immediately before the making of such Swap
Termination Advance.
"BB Transaction Documents" means the Swap Confirmation and
the Term Redeemable Securities Contract.
"Collateral" means, individually and collectively, all right,
title, and interest of Borrower or any Acquisition Entity in, to and
under each of the following items of property pledged by Borrower
(and/or by Old Capital Trust) or any Acquisition Entity to Lender
and/or Bank from time to time and whether now owned or hereafter
acquired, now existing or hereafter created and wherever located:
(i) all Collateral pledged under any Pledge Agreement(s)
previously executed by Old Capital Trust in favor of Lender;
(ii) every Asset as to which Borrower, Old Capital Trust or
any Acquisition Entity held, and has delivered to Lender (or Lender's
custodian), a promissory note;
(iii) all property listed in any UCC-1 financing statement
previously or hereafter filed by Borrower, Old Capital Trust, or any
Acquisition Entity in favor of Lender or Bank;
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(iv) all Collateral Loan Documents, including all securities,
promissory notes, any collateral pledged or otherwise relating to such
Collateral, all representations and warranties made to, or for the
benefit of, Borrower, Old Capital Trust, or any Acquisition Entity by
any Obligor, all servicing agreements, together with all files,
documents, instruments, surveys, certificates, correspondence,
appraisals, computer programs, computer storage media, accounting
records and other books and records relating thereto;
(v) all Collateral Security Instruments;
(vi) all guaranties and insurance (issued by governmental
agencies or otherwise) and any insurance certificate or other document
evidencing such guaranties or insurance relating to any Collateral and
all claims and payments thereunder;
(vii) all other insurance policies and insurance proceeds
relating to any Collateral or the related right or interest in or to
property of any kind whatsoever, whether real, personal, or mixed and
whether tangible or intangible;
(viii) all interest rate protection agreements;
(ix) any accounts established by any servicer subject to a
security interest in favor of Lender and/or Bank;
(x) all "general intangibles," "accounts," and "chattel
paper" as defined in the UCC relating to or constituting any and all of
the foregoing; and
(xi) any and all replacements, substitutions, distributions
on, or proceeds (including condemnation proceeds) of, any and all of
the foregoing set forth in items (i) through (x), whether now owned or
hereafter acquired, now existing or hereafter created, and wherever
located.
"Commitment" means the sum of Three Hundred Fifty Five
Million Dollars ($355,000,000).
"Designation Conditions" means the following restrictions,
requirements, and conditions (except to the extent waived in writing by
Lender), all of which must be satisfied (except to the extent waived in
writing by Lender) as to any Designation Notice delivered by Borrower:
o Swap Collateral Amount Limitations. The Swap Collateral
Amount shall: (a) equal the sum of the Asset-Specific Swap
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Collateral Amounts; (b) not exceed the Maximum Swap
Collateral Amount; and (c) not exceed Line Availability; and
o Asset Limitations. For each Asset, the Asset-Specific Swap
Collateral Amount shall not exceed the Asset-Specific Line
Availability.
"Designation Notice" means, from time to time, to the extent
permitted or required by this Agreement, a notice from Borrower to
Lender, setting forth the Swap Collateral Amount and all Asset-Specific
Swap Collateral Amounts, provided however that any Designation Notice
shall (unless Lender agrees otherwise in writing) not be effective:
o Designation Conditions. If it does not comply with the
Designation Conditions;
o Event of Default. During the pendency of an uncured Event of
Default under this Agreement, unless such Designation Notice
is given within one (1) Business Day after such Event of
Default and reduces the Swap Collateral Amount and all
Asset-Specific Swap Collateral Amounts to zero and
immediately after taking into account such Designation
Notice BB Sub remains in compliance with the Swap
Confirmation;
o Swap Termination Event. If any Swap Termination Event has
occurred and five (5) Business Days has elapsed after such
Swap Termination Event; or
o BB Transaction Document(s). If BB Sub is otherwise not in
compliance with any BB Transaction Document(s), unless such
noncompliance arises only under the Swap Confirmation and
both (i) the cure period under the Swap Confirmation for
such noncompliance has not expired and (ii) the Swap
Collateral Amount validly designated in such Designation
Notice cures such noncompliance.
"Earn Out Fee" means, on each Earn Out Payment Date, a
payment in an amount equal to the product of (i) One-Quarter of One
Percent (0.25%) and (ii) the then outstanding Principal Indebtedness as
of such Earn Out Payment Date.
"Earn Out Payment Date" means each of the following dates:
May 31, 2002; August 31, 2002; November 30, 2002; and February 28,
2003, or if any such day is not a Business Day then the first Business
day thereafter.
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"Interest Credit for Terminated BB Securities" means, for any
period(s) ending no later than February 28, 2002, provided that no
uncured Event of Default shall exist, an amount equal to the following
as calculated from time to time by Lender for such period: (a) the
average LIBOR Spread (calculated daily and weighted based on the amount
of each Asset-Specific Loan Balance outstanding each day) on all
Asset-Specific Loan Balances during such period less 50 basis points
times (b) the lesser of (i) the Terminated BB Security Amount for any
and all Terminated BB Securities or (ii) the average principal amount
of the Loan outstanding.
"Line Availability" means, from time to time, an amount equal
to the sum of the Asset-Specific Availabilities for all the Collateral.
"Line-Secured Swap Termination Payment" means a payment by BB
Sub or Borrower (as applicable) to Bank equal to the entire Swap
Collateral Amount, when and as this Agreement requires BB Sub or
Borrower to pay the Line-Secured Swap Termination Payment. The
obligation of BB Sub or Borrower to pay any Line-Secured Swap
Termination Payment constitutes a Secured Obligation under this
Agreement.
"Loan Fee" means a fee of $2,525,000, previously paid by
Borrower on account of Lender's making and/or agreeing to make the Loan
to Borrower. The Loan Fee does not include or reflect any Drawdown
Fees; the latter fees are not addressed in any way by this Amendment.
"Maturity Date" means the earlier of (a) February 28, 2002,
or, if the Maturity Date has been extended pursuant to this Agreement,
the then applicable Maturity Date, as determined pursuant to Section
2.8 of this Agreement and (b) such earlier date on which the entire
Loan is required to be paid in full, by acceleration or otherwise under
this Agreement or any of the other Security Documents.
"Maximum Swap Collateral Amount" means from time to time the
product of (a) the VAR Required Collateral Amount times (b) 100/70
times (c) two. The outcome of such calculation shall be rounded to the
nearer multiple of $100,000. As of the Restatement Date, the Maximum
Swap Collateral Amount is Thirteen Million One Hundred Thousand Dollars
($13,100,000).
"Secured Obligations" shall all be secured by all the
Collateral and shall consist of the following obligations of Borrower
under this Agreement to both Lender and Bank as secured parties, and BB
Sub's
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obligations under the Swap Confirmation (which obligations are
guarantied by Borrower) as set forth below:
o Principal, Interest, and Other Sums. Payment of principal
and interest under the Loan and all other amounts owing to
Lender hereunder, under the Note, under the other Security
Documents;
o Indebtedness. Any and all other Indebtedness from time to
time outstanding; and
o Certain Swap Obligations. BB Sub's and Borrower's
obligations (a) to pay the Bank any Line-Secured Swap
Termination Payment when and as required by this Agreement
and (b) to deliver additional collateral to Bank for the
Swap Confirmation when and as required by Section 2.17 of
this Agreement, but no other obligations of BB Sub to Bank.
"Security Documents" shall include: (a) this Agreement; (b)
the Third-Party Notices; and (c) all past, present, and future Security
Documents as defined in the Original Credit Agreement.
"Swap Collateral Amount" means from time to time the amount
designated as "Swap Collateral Amount" in the most recent valid
Designation Notice. As of the Restatement Date, the Swap Collateral
Amount equals 100/70 times the VAR Required Collateral Amount, in other
words a total of $6,571,428.57. It is intended that the Swap Collateral
Amount will, from time to time, equal the lesser of (a) the Maximum
Swap Collateral Amount or (b) the product of (x) 100/70 times (y) the
sum of the following items:
o VAR Collateral. The VAR Required Collateral Amount; plus
o Other Swap Collateral Amount. The amount of any collateral,
other than the VAR Required Collateral Amount, required to
be provided from time to time by BB Sub to Bank under the
Swap Confirmation and not otherwise provided by BB Sub to
Bank under the Swap Confirmation, provided that pursuant to
the Swap Confirmation, BB Sub is permitted to provide such
collateral in the form of a security interest in the
Collateral under this Agreement.
"Swap Confirmation" means, collectively, that certain Master
Agreement between BB Sub and the Bank, together with a "Confirmation"
with a "Schedule" annexed setting forth fifteen notional amounts and
fifteen "VAR" amounts, all dated on or about the
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Restatement Date, entered into between BB Sub and the Bank, together
with all other documents referred to or incorporated therein (including
the "Credit Support Annex"), all as modified and amended from time to
time by written agreement between BB Sub and the Bank and as in effect
from time to time pursuant to the foregoing. Any such written agreement
need not be consented to, joined in, or confirmed by Borrower.
"Swap Termination Advance" means an Advance by Lender in an
amount equal to the lesser of (a) 70/100 times the Swap Collateral
Amount or (b) the cash amount the Swap Confirmation requires BB Sub to
pay on account of such Swap Termination Event, as calculated by Bank.
"Swap Termination Event" means the occurrence of any of the
following as defined under the Swap Confirmation, after the giving of
such notices (if any) and the passage of such cure periods (if any) as
are provided for in the Swap Confirmation: (i) an Event of Default by
BB Sub under the Swap Confirmation (even if such Event of Default is
not enforceable against BB Sub, such as an Event of Default arising
from the bankruptcy or insolvency of BB Sub); (ii) a Specified
Condition (as defined in paragraph 13 of the ISDA Credit Support Annex
constituting part of the Swap Confirmation) with respect to BB Sub; or
(iii) an Early Termination Date that has been designated by Bank as a
result of an Event of Default under the Swap Confirmation or Specified
Condition with respect to BB Sub. For purposes of this Agreement and
Lender's and Bank's rights and remedies against the Collateral on
account of a Swap Termination Event, to the extent that a Swap
Termination Event requires as a condition thereto the giving of any
notice to BB Sub, Lender or Bank may at its option instead give such
notice to Borrower, and such notice to Borrower shall be fully
effective, as if it were valid and timely notice to BB Sub, for
purposes of determining the existence of a Swap Termination Event for
purposes of this Agreement and the Collateral only.
"Term Redeemable Securities Contract" means the Term
Redeemable Securities Contract (together with exhibits and annexes
thereto, if any), dated on or about the Restatement Date, between the
Bank and BB Sub, all as modified and amended from time to time by
written agreement between BB Sub and the Bank. Any such written
agreement need not be consented to, joined in, or confirmed by
Borrower.
"Terminated BB Security" means, provided that no uncured
Event of Default shall exist under this Agreement or under the Term
Redeemable Securities Contract, any security that:
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o Former Status. Was previously a "Purchased Security" and the
subject of a "Transaction" under the Term Redeemable
Securities Contract;
o Repurchased. BB Sub has repurchased from the Bank under the
Term Redeemable Securities Contract and has transferred to
Borrower or an Affiliate of Borrower; and
o Borrower Ownership. In Lender's reasonable determination,
Borrower or a single-purpose Affiliate of Borrower, wholly
owned by Borrower, owns such security. Such ownership may,
however, be subject to Liens, "repurchase" agreements,
"reverse repurchase" agreements, or similar arrangements,
and may be subject to other financing techniques such as a
"securitization" provided that the assets of such
securitization consist solely of securities wholly owned by
Borrower (and do not include any securities or other assets
contributed by other parties). If a third party holds an
equity interest in such security or in the single-purpose
Affiliate of Borrower that owns such security, then Borrower
shall be deemed to continue to own only a portion of such
security equal to Borrower's direct or indirect remaining
equity ownership interest therein, as reasonably determined
by Lender, and the Terminated BB Security Amount shall be
prorated accordingly. (Notwithstanding the foregoing, if any
"securitization" structure contains any assets contributed
by other parties, then Borrower shall be deemed to own no
interest in any securities deposited by Borrower into such
securitization for purposes of this definition.) In the
event of a dispute regarding the application of this
paragraph, Borrower shall bear the burden of demonstrating
Borrower's direct or indirect equity ownership (or a
proration thereof) as to any security. Nothing in this
paragraph is intended to prohibit Borrower from entering
into any transaction not otherwise prohibited by this
Agreement. This paragraph is intended merely to define
"Terminated BB Security."
"Terminated BB Security Amount" means for each Terminated BB
Security (or group of Terminated BB Security(ies)) the Allocated
Transaction Amounts as of the Restatement Date of such Terminated BB
Security(ies) as defined in the Term Redeemable Securities Contract. In
the case of partial equity ownership of Terminated BB Security(ies),
the Terminated BB Security Amount shall be prorated based on the
percentage of equity ownership retained by Borrower.
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"Third Party Notices" means any and all written notices
previously executed and delivered by Old Capital Trust, and that Lender
may require Borrower to execute and deliver to Lender in the future, by
which Old Capital Trust and Borrower notify various third parties
(borrowers, participants, lead lenders, lockbox administrators, and
others) that (among other things) certain actions by Borrower with
respect to the Collateral require the consent and confirmation by
Lender and such actions shall not be taken without Lender's consent, it
being understood that such notices are not to be actually delivered
unless and until an Event of Default has occurred.
"VAR Required Collateral Amount" means the VAR Required
Collateral Amount under the Swap Confirmation from time to time. As of
the Restatement Date, the VAR Required Collateral Amount is Four
Million Six Hundred Thousand Dollars ($4,600,000).
4. Additional Financial Covenants.
4.1. Section 2.8 of the Original Credit Agreement is hereby deleted in
its entirety and replaced by the following:
(a) Upon a single written request by Borrower delivered to
Lender on one occasion during July, August, or September 2001, Lender
shall on one occasion request Lender's Credit Committee to consider
extending the Maturity Date to February 28, 2003. Lender (and Lender's
Credit Committee) is under absolutely no obligation to extend the
Maturity Date to February 28, 2003. If, as of December 31, 2001, Lender
has not given notice that Lender has extended the Maturity Date to
February 28, 2003, then the Maturity Date shall remain February 28,
2002.
(b) If Lender extends the Maturity Date to February 28, 2003
pursuant to this Section 2.8 (a "One-Year Extension"), then all the
other terms and conditions of this Agreement and the other Security
Documents shall remain in full force and effect and unmodified and
Section 2.8(c) shall not apply.
(c) If Lender does not grant a One-Year Extension, then,
automatically and without further action by either party, Borrower's
obligation to repay the Principal Indebtedness outstanding on February
28, 2002 shall be extended for an "earn-out period" as set forth in
this paragraph and, during the period from and including March 1, 2002
through and including February 28, 2003: (i) Borrower shall pay Lender
an Earn Out Fee on each Earn Out Payment Date occurring after the
Maturity Date, (ii) Lender shall have no obligation to make any further
Advances, and (iii) so long as no Event of Default (other than failure
to pay Principal Indebtedness on the Maturity Date) exists under the
Loan or
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this Agreement, Borrower shall repay any Principal Indebtedness due on
February 28, 2002 in four equal installments each on an Earn Out
Payment Date and each such installment in an amount equal to
Twenty-Five Percent (25%) of the Principal Indebtedness outstanding on
February 28, 2002. Borrower shall continue to pay interest in
accordance with Section 2.4. Borrower shall be permitted to pay all or
a portion of the amount calculated pursuant to clause (iii) at any time
before the specific due date without premium or penalty. Subsequent
installments of the Earn Out Fee will be recalculated to reflect any
such early payments on account of the Principal Indebtedness. If
Borrower pays in excess of the required amount for any quarterly
installment, then such excess amount shall constitute a credit (in
whole or in part) against any succeeding quarterly installment as
directed by Borrower.
4.2. Section 2.10 of the Original Credit Agreement is hereby amended by
adding the following at the end of clause (b) after the words "Principal
Indebtedness":
and that following such release of Collateral, Line Availability shall
continue to equal or exceed the then-current Swap Collateral Amount
4.3. Section 2.17 is added to the Original Credit Agreement, as
follows.
SECTION 2.17. Designation Notices; Effect of Swap Termination
Event.
(a) Borrower shall have the right, from time to time by
written notice to Lender, to issue Designation Notices to Lender,
provided however that each such Designation Notice shall comply with
all the Designation Conditions and with the definition of the term
"Designation Notice" as it applies to Designation Notices issued by
Borrower (including satisfaction of the conditions set forth in such
definition). Any Designation Notice that reduces the Swap Collateral
Amount shall not be valid or effective unless confirmed by Lender in
writing. Lender shall not withhold or delay such confirmation if, after
taking into account Borrower's Designation Notice, BB Sub will,
immediately after taking into account such Designation Notice, be in
compliance with the Swap Confirmation. Upon Lender's issuance of such
confirmation, Borrower's Designation Notice will be effective
retroactively to the date delivered. For purposes of the Swap
Confirmation and this Agreement, any valid Designation Notice that
increases Swap Collateral Amount shall be effective upon delivery to
Lender. As of the Restatement Date, Borrower hereby issues a
Designation Notice to Lender specifying a Swap Collateral Amount equal
to 100/70 times the VAR Required Collateral Amount. Lender hereby
confirms and approves such Designation Notice, even though it does not
designate Asset-Specific Swap Collateral Amounts. Such Designation
Notice shall
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be in full force and effect for all purposes. Within five Business days
after the Restatement Date, Borrower shall issue a Designation Notice
to specify Asset-Specific Swap Collateral Amounts (effective
retroactively to the Restatement Date) consistent with such Designation
Notice and the Designation Conditions.
(b) Lender may at any time notify Borrower of Lender's
redetermination of Line Availability and/or Maximum Swap Collateral
Amount. If such notice causes any Designation Condition not to be
satisfied, then within the period allowed under the Swap Confirmation
for delivery of additional collateral, Borrower shall deliver to Lender
a Designation Notice in compliance with Section 2.17(a). To the extent
that at any time the Swap Confirmation requires BB Sub to provide Bank
with additional collateral and BB Sub has failed to provide such
collateral within the delivery period provided for under the Swap
Confirmation, Borrower shall (unless Lender elects otherwise in
writing) be deemed to have issued a Designation Notice designating a
Swap Collateral Amount (if higher than the previously applicable Swap
Collateral Amount) equal to the lowest of (i) a Swap Collateral Amount
sufficient to bring BB Sub into compliance with the Swap Confirmation;
(ii) the Maximum Swap Collateral Amount; or (iii) Line Availability.
(c) Any Designation Notice purportedly given by Borrower that
does not comply with Section 2.17(a) shall, unless Lender waives such
noncompliance in writing, be void and ineffective. If any Designation
Notice is void and ineffective, then: (a) the last preceding
Designation Notice shall govern until superseded by another valid
Designation Notice; and (b) Borrower shall remain entitled to exercise
its rights under Section 2.17(a). At all times the most recent valid
Designation Notice shall govern. In the event of uncertainty regarding
the effectiveness, timing, and terms of any Designation Notices,
Lender's certificate thereof shall govern in the absence of manifest
error, but without prejudice to Borrower's rights under Section
2.17(a).
(d) As to any Swap Collateral Amount validly specified by
Borrower in any Designation Notice, BB Sub shall be deemed for purposes
of the Swap Confirmation to have elected to provide collateral under
the Swap Confirmation in an amount equal to 70/100 times the Swap
Collateral Amount validly designated in such Designation Notice. If, as
a result of the preceding sentence, BB Sub is not providing all
collateral as required under the Swap Confirmation, then Bank may
exercise its rights and remedies against BB Sub for such failure as
provided for under the Swap Confirmation (after the giving of such
notices and opportunity to cure, if any, as are provided for under the
Swap Confirmation), but BB
14
Sub's mere failure to provide adequate collateral under the Swap
Confirmation shall not be a default under this Agreement.
(e) Upon the occurrence of any Swap Termination Event,
provided that all conditions to Advances hereunder are satisifed or
waived in writing by Lender, Lender shall (if requested by Borrower in
compliance with this Agreement within five (5) Business Days after the
occurrence of such Swap Termination Event) make a Swap Termination
Advance. Lender shall disburse the proceeds of such Swap Termination
Advance directly to Bank on account of BB Sub's obligations to Bank
under the Swap Confirmation. Simultaneously with the making of a full
Swap Termination Advance: (a) each Asset-Specific Loan Balance shall be
adjusted accordingly (in accordance with the definition of such term);
(b) thereafter, the Swap Collateral Amount and all Asset-Specific Swap
Collateral Amounts shall be reset to zero; and (c) Borrower shall pay
Lender an amount equal to any unpaid Drawdown Fee for the Swap
Termination Advance. Subject to Line Availability, Borrower may, upon
written notice to Lender, fund such Drawdown Fee by obtaining an
additional Advance under this Agreement in accordance with all the
terms and conditions of this Agreement, including the satisfaction of
all conditions to Advances. Upon Lender's making of any Swap
Termination Advance, the principal amount of the Loan and the Secured
Obligations shall be increased by the aggregate amount of the Swap
Termination Advance for all purposes, including the Security Documents.
(f) If, as of the date five (5) Business Days after a Swap
Termination Event, Borrower has not qualified for and obtained (through
Lender's disbursement directly to Bank for the benefit of BB Sub) a
full Swap Termination Advance, then Borrower (as guarantor of BB Sub's
obligations to Bank under the Swap Confirmation) shall pay the
Line-Secured Swap Termination Payment to Bank on BB Sub's behalf. Such
obligation of Borrower to pay Bank shall constitute a Secured
Obligation. If Borrower fails to pay Bank the Line-Secured Swap
Termination Payment to Bank, then Bank (or Lender on Bank's behalf) may
exercise any and all rights and remedies under this Agreement with
respect to any or all of the Collateral.
(g) If an Event of Default occurs under this Agreement and at
that time the Swap Collateral Amount exceeds zero, then within one (1)
Business Day after the occurrence of such Event of Default, Borrower or
BB Sub shall post other collateral under the Swap Confirmation so that
no Swap Collateral Amount shall be necessary under this Agreement. If
Borrower fails to do so within such time, then a Swap Termination Event
shall be deemed to have occurred, but (so long as no other Swap
15
Termination Event shall have occurred) only for purposes of this
Agreement.
(h) To the extent that the Swap Confirmation from time to
time requires BB Sub to deliver additional collateral under the Swap
Confirmation, Borrower shall cause BB Sub to comply with such
obligation (up to the Maximum Swap Collateral Amount) within the time
period provided for under the Swap Confirmation. Borrower may obtain
Advances under this Agreement, in compliance with all the terms and
conditions of this Agreement, for such purpose. If and when BB Sub
delivers such additional collateral under the Swap Confirmation,
Borrower shall be entitled to adjust the Swap Collateral Amount
accordingly. Borrower's obligation to cause BB Sub to deliver such
additional collateral (up to the Maximum Swap Collateral Amount) shall
constitute a Secured Obligation.
(i) Lender shall cause Bank to credit any Swap Termination
Advance or Line-Secured Swap Termination Payment actually made to Bank
(as applicable) against BB Sub's obligations to Bank under the Swap
Confirmation and refund to BB Sub any excess that would otherwise be
refundable to BB Sub on account of overpayment of BB Sub's obligations
under the Swap Confirmation, all in accordance with the Swap
Confirmation.
4.4. Section 2.18 is added to the Original Credit Agreement, as
follows:
SECTION 2.18. Line Availability and Maximum Swap Collateral
Amount. Notwithstanding anything to the contrary in this Agreement,
Lender shall never be obligated to make an Advance if, after the making
of such Advance, Line Availability would be less than the Swap
Collateral Amount. Borrower shall cause Asset-Specific Line
Availability for each Asset to equal or exceed zero at all times.
4.5. Section 2.19 is added to the Original Credit Agreement, as
follows:
SECTION 2.19 Interest Credit for Terminated BB Securities. As
to any interest payable under this Agreement accruing for any period
expiring no later than February 28, 2002, provided that no uncured
Event of Default shall then exist under this Agreement or under any BB
Transaction Document, Borrower shall be entitled to a credit against
such interest payable under this Agreement. Such credit shall equal the
Interest Credit for Terminated BB Securities as calculated by Lender
(in consultation with Borrower) with respect to the same period over
which the interest payable by Borrower hereunder accrued. In the event
of a dispute regarding the calculation of Interest Credit for
Terminated BB
15
Securities, such credit shall be calculated in accordance with Lender's
determination pending resolution of the dispute.
4.6. Section 2.20 is added to the Original Credit Agreement, as
follows:
SECTION 2.20. Waiver of Rights and Defenses. Borrower
consents to Lender's making, and hereby directs Lender to make, any
Swap Termination Advance, when and as provided for under the express
terms of this Agreement, all without regard to any other fact or
circumstance relating to BB Sub, including any bankruptcy or insolvency
of BB Sub. Borrower shall pay any Line-Secured Swap Termination Payment
as a Secured Obligation and part of the Loan without regard to any
defenses, claims, counterclaims, or offsets that Borrower might
otherwise be able to assert based on any fact or circumstance related
to BB Sub or any BB Transaction Document (other than payment by
Borrower or BB Sub), including any matter relating to the genuineness,
validity, regularity or enforceability of any BB Transaction Document.
Borrower's liability on account of payment of the Line-Secured Swap
Termination Payment is a continuing, absolute, and unconditional
obligation under any and all circumstances whatsoever (except as
expressly stated, if at all, in this Amendment), without regard to the
validity, regularity or enforceability of the BB Transaction Documents.
Borrower's obligation to pay the Line-Secured Swap Termination Payment
as part of the Loan shall arise even if BB Sub and the Bank have
amended, modified, or waived any terms of any BB Transaction Document,
and the Line-Secured Swap Termination Payment shall be calculated and
determined after giving effect to any amendment or modification of any
BB Transaction Document agreed to between BB Sub and the Bank, whether
or not consented to or confirmed by Borrower. Borrower acknowledges
that Borrower is fully obligated for payment of the Line-Secured Swap
Termination Payment even if BB Sub had no liability at the time of
execution of the BB Transaction Documents or later ceases to be liable
under the foregoing, other than as a result of full payment of all sums
payable by BB Sub under the express terms of the BB Transaction
Documents before taking into account any modification thereof pursuant
to any bankruptcy or insolvency proceeding. If BB Sub's liability under
the BB Transaction Documents is limited, discharged, reduced, or
deferred as the result of any bankruptcy or insolvency proceeding
affecting BB Sub (other than as a result of actual payment by BB Sub),
then Borrower's obligations hereunder shall continue as if such
limitation, discharge, reduction, or deferral had not occurred.
Borrower shall not be entitled to claim, and irrevocably covenants not
to raise or assert, any defenses against payment of the Line-Secured
Swap Termination Payment, except for defenses arising from the express
terms of the BB Transaction Documents. Borrower waives any right to
require Lender or Bank (before
16
Lender makes a Swap Termination Advance to Bank or Bank and Lender
realize upon the Collateral to collect the Line-Secured Swap
Termination Payment) to (a) proceed against BB Sub, (b) proceed against
or exhaust any collateral provided to Bank by BB Sub (but this shall
not limit Lender's obligation to apply proceeds of any foreclosure sale
of the Collateral under this Agreement against the Secured
Obligations), or (c) pursue any other right or remedy for Borrower's
benefit. Borrower agrees that Lender may proceed against Borrower with
respect to payment of the Line-Secured Swap Termination Payment without
taking any actions against BB Sub and without proceeding against or
exhausting any security. Bank may unqualifiedly exercise in its sole
discretion any or all rights and remedies available to it against BB
Sub without impairing Lender's rights and remedies in enforcing
Borrower's obligation to pay the Line-Secured Swap Termination Payment
or any portion thereof, under which Borrower's liabilities shall remain
independent and unconditional and fully secured by all the Collateral.
Borrower waives diligence and all demands, protests, presentments and
notices of every kind or nature, including notices of protest,
dishonor, nonpayment, acceptance of this Amendment and the creation,
renewal, extension, modification or accrual of Borrower's obligation to
pay any or all of the Line-Secured Swap Termination Payment. No failure
or delay on Lender's part in exercising any power, right, or privilege
with respect to payment of the Line-Secured Swap Termination Payment
shall impair or waive any such power, right or privilege. No failure or
delay on Bank's part in exercising any power, right, or privilege under
any BB Transaction Document shall limit Borrower's obligation to repay
any Swap Termination Advance.
5. Collateral Security.
5.1. Article III of the Original Credit Agreement is hereby deleted in
its entirety and replaced by the following new Article III to reconfirm
Borrower's grant of a security interest in existing Collateral to Lender and to
Bank, and to provide for Borrower's grant of a security interest to Lender and
to Bank in all future Collateral without the need to enter into future pledge
agreements and to supplement and clarify certain rights and remedies of Lender:
SECTION 3.1. In General. (a) Borrower hereby assigns, pledges
and grants a security interest to Lender (on its own behalf as secured
party and on behalf of Bank as secured party) in all of Borrower's
right, title and interest in, to and under the Collateral to secure
Borrower's payment and performance in full of all Secured Obligations.
(b) Even though this Agreement refers to Asset-Specific Loan
Balances, the Loan constitutes one indebtedness, secured in its
entirety by all Collateral. Any Default or Event of Default relating to
any
17
one Asset shall constitute a Default or Event of Default relating to
all Collateral.
SECTION 3.2 Lender's Appointment as Attorney-in-Fact. (a)
Borrower hereby irrevocably constitutes and appoints Lender and any
officer or agent thereof, with full power of substitution, as its true
and lawful attorney-in-fact with full irrevocable power and authority
in the place and stead of Borrower and in the name of Borrower or in
its own name, from time to time in Lender's discretion, for the purpose
of carrying out the terms of this Agreement, to take any and all
appropriate action and to execute any and all documents and instruments
which may be necessary or desirable to accomplish the purposes of this
Agreement, for the benefit of both Lender and Bank, and, without
limiting the generality of the foregoing, Borrower hereby gives Lender
(on its own behalf and on behalf of Bank) the power and right, on
behalf of Borrower, without assent by, but with notice to (if permitted
by law), Borrower, if an Event of Default shall have occurred and be
continuing, to do the following:
(i) in the name of Borrower or its own name, or otherwise, to
take possession of and endorse and collect any checks, drafts, notes,
acceptances or other instruments for the payment of moneys due under
any mortgage insurance or with respect to any other Collateral and to
file any claim or to take any other action or proceeding in any court
of law or equity or otherwise deemed appropriate by Lender for the
purpose of collecting any and all such moneys due under any such
mortgage insurance or with respect to any other Collateral whenever
payable;
(ii) to pay or discharge taxes and Liens levied or placed on
or threatened against the Collateral; and
(iii) (A) to direct any party liable for any payment under
any Collateral to make payment of any and all moneys due or to become
due thereunder directly to Lender or as Lender shall direct; (B) to ask
or demand for, collect, receive payment of and receipt for, any and all
moneys, claims and other amounts due or to become due at any time in
respect of or arising out of any Collateral; (C) to sign and endorse
any invoices, assignments, verifications, notices and other documents
in connection with any of the Collateral; (D) to commence and prosecute
any suits, actions or proceedings at law or in equity in any court of
competent jurisdiction to collect the Collateral or any part thereof
and to enforce any other right in respect of any Collateral; (E) to
defend any suit, action or proceeding brought against Borrower with
respect to any Collateral; (F) to settle, compromise or adjust any
suit, action or proceeding described in clause (E) above and, in
connection therewith, to give such discharges or releases as Lender may
deem appropriate; and (G) generally, to sell,
18
transfer, pledge and make any agreement with respect to or otherwise
deal with any of the Collateral as fully and completely as though
Lender were the absolute owner thereof for all purposes, and to do, at
Lender's option and Borrower's expense, at any time, and from time to
time, all acts and things which Lender deems reasonably necessary to
protect, preserve or realize upon the Collateral and Lender's Liens
thereon and to effect the intent of this Agreement, all as fully and
effectively as Borrower might do.
Borrower hereby ratifies all that said attorneys shall lawfully do or
cause to be done by virtue hereof. This power of attorney is a power
coupled with an interest and shall be irrevocable until the repayment
in full of all Secured Obligations.
(b) Borrower also authorizes Lender, at any time and from
time to time, to execute, in connection with any sale pursuant to
Lender's exercise of remedies hereunder, any endorsements, assignments
or other instruments of conveyance or transfer with respect to the
Collateral.
(c) The powers conferred on Lender are solely to protect
Lender's and Bank's interests in the Collateral and shall not impose
any duty upon Lender to exercise any such powers. Lender shall be
accountable only for amounts that it actually receives as a result of
the exercise of such powers, and neither Lender nor any of its
officers, directors, or employees shall be responsible to Borrower for
any act or failure to act hereunder, except for its own gross
negligence or willful misconduct.
SECTION 3.3. Remedies. If an Event of Default shall occur and
be continuing, Lender and Bank may exercise, in addition to all other
rights and remedies granted to them in this Agreement and in any other
instrument or agreement securing, evidencing or relating to the Secured
Obligations, all rights and remedies of a secured party under the UCC.
In doing so, Lender may act on its own behalf and on behalf of Bank
without any requirement to separately identify Bank. Without limiting
the generality of the foregoing, Lender without demand of performance
or other demand, presentment, protest, advertisement or notice of any
kind (except any notice required by law referred to below or expressly
required by this Agreement or the Swap Confirmation) to or upon
Borrower or any other Person (each and all of which demands,
presentments, protests, advertisements and notices are hereby waived),
may in such circumstances forthwith collect, receive, appropriate and
realize upon the Collateral, or any part thereof, and/or may forthwith
sell, lease, assign, give option or options to purchase, or otherwise
dispose of and deliver the Collateral or any part thereof (or contract
to do any of the foregoing), in one or more parcels or as an entirety
at public or private sale
19
or sales, at any exchange, broker's board or office of Lender or
elsewhere upon such terms and conditions as it may deem advisable and
at such prices as it may deem best, for cash or on credit or for future
delivery without assumption of any credit risk. Lender shall have the
right upon any such public sale or sales, and, to the extent permitted
by law, upon any such private sale or sales, to purchase the whole or
any part of the Collateral so sold, free of any right or equity of
redemption in Borrower, which right or equity is hereby waived or
released. Borrower further agrees, at Lender's request, to assemble the
Collateral and make it available to Lender at places which Lender shall
reasonably select, whether at Borrower's premises or elsewhere. Lender
shall apply the net proceeds of any such collection, recovery, receipt,
appropriation, realization or sale, after deducting all reasonable
costs and expenses of every kind incurred therein or incidental to the
care or safekeeping of any of the Collateral or in any way relating to
the Collateral or the rights of Lender hereunder, including without
limitation reasonable attorneys' fees and disbursements, to the payment
in whole or in part of the Secured Obligations, in such order as Lender
may elect, and only after such application and after the payment by
Lender of any other amount required or permitted by any provision of
law, including without limitation Section 9-504(1)(c) of the UCC, need
Lender account for the surplus, if any, to Borrower. To the extent
permitted by applicable law, Borrower waives all claims, damages and
demands it may acquire against Lender arising out of the exercise by
Lender of any of its rights hereunder, other than those claims, damages
and demands arising from Lender's gross negligence, willful misconduct,
or failure to act in a commercially reasonable manner when and as
required by the UCC. Lender shall give Borrower notice of any proposed
sale or other disposition of Collateral, which notice shall be deemed
reasonable and proper if given at least ten (10) days before such sale
or other disposition. Borrower shall be permitted to bid at any such
sale. Borrower shall remain liable for any deficiency (plus accrued
interest thereon) if the proceeds of any sale or other disposition of
the Collateral (net of costs incurred in connection with such sale or
other disposition) are insufficient to pay the Secured Obligations and
the reasonable fees and disbursements of any attorneys employed by
Lender to collect such deficiency. For purposes of Lender's exercise of
remedies hereunder, any of the following shall be deemed to adequately
identify any property, claim, or contract right as Collateral
hereunder, and no further identification or evidence of such status as
Collateral shall be required: (a) identification in a UCC-1 financing
statement signed by Borrower; and/or (b) Lender's possession (or
possession by Lender's custodian or trustee) of the original promissory
note or similar instrument evidencing such Collateral.
20
SECTION 3.4. Further Assurances. (a) Borrower shall
undertake, at its sole cost and expense, with respect to each item of
Collateral pledged hereunder as security for the Secured Obligations,
any and all actions deemed necessary by Lender for the granting by
Borrower to Lender (on its own behalf and for the benefit of Bank as
secured party), and Lender's successors and assigns, of a valid first
priority (except as otherwise approved by Lender prior to making the
Advance against such Collateral) security interest in such Collateral.
(b) At any time and from time to time, upon the written
request of Lender, and at the sole expense of Borrower, Borrower shall
promptly and duly execute and deliver, or will promptly cause to be
executed and delivered, such further instruments and documents and take
such further action as Lender may reasonably request for the purpose of
obtaining or preserving the full benefits of this Agreement for both
Lender and Bank and of the rights and powers herein granted, including,
without limitation, the filing of any financing or continuation
statements under the UCC. Borrower also hereby authorizes Lender and/or
Bank to file any such financing or continuation statement without the
signature of Borrower to the extent permitted by applicable law. A
carbon, photographic or other reproduction of this Agreement shall be
sufficient as a financing statement for filing in any jurisdiction.
SECTION 3.5 Changes in Location, Name, etc. Borrower shall
not (i) change the location of its chief executive office/chief place
of business or (ii) change its name, identity, state of organization,
type of entity, or location where it maintains its records with respect
to the Collateral unless it shall have given Lender at least thirty
(30) days prior written notice thereof and shall have delivered to
Lender all UCC financing statements and amendments thereto as Lender
shall request (provided same are delivered to Borrower prior to the
lapse of such thirty [30] day period) and taken all other actions
deemed necessary by Lender to continue its perfected status in the
Collateral with at least the same priority. Thereafter Lender shall
continue to have the right to request additional UCC financing
statements and amendments thereto, and Borrower shall promptly sign and
return same, but Borrower's doing so shall not constitute a condition
to Borrower's right to consummate the change of the type described in
the first sentence of this paragraph.
SECTION 3.6. Performance by Lender of Borrower's Obligations.
Subject to Section 9.12, if Borrower fails to perform or comply with
any of the Secured Obligations and Lender itself performs or complies,
or otherwise causes performance or compliance, with such Secured
Obligation, then the third party out of pocket expenses of Lender
incurred in connection with such performance or compliance, together
21
with interest thereon at a rate per annum equal to the Default Rate,
shall be payable by Borrower to Lender on demand and shall constitute
Secured Obligations.
SECTION 3.7. Proceeds. If an Event of Default shall occur and
be continuing, (a) all proceeds of Collateral received by Borrower
consisting of cash, checks and other near-cash items shall be held by
Borrower in trust for Lender and Bank, segregated from other funds of
Borrower, and, within two (2) Business Days of receipt by Borrower,
shall be turned over to Lender in the exact form received by Borrower
(duly endorsed by Borrower to Lender, if required, in order to be
negotiated by Lender for the benefit of Lender and Bank), and (b) any
and all such proceeds received by Lender (whether from Borrower or
otherwise) may, in the sole discretion of Lender, be held by Lender as
collateral security for, and/or then or at any time thereafter may be
applied by Lender against, the Secured Obligations (whether matured or
unmatured), such application to be in such order as Lender shall elect.
Any balance of such proceeds remaining after the Secured Obligations
shall have been paid in full and this Agreement shall have been
terminated shall be paid over to Borrower or to whomsoever may be
lawfully entitled to receive the same. For purposes hereof, proceeds
shall include, but not be limited to, all principal and interest
payments, all prepayments and payoffs, insurance claims, condemnation
awards, sale proceeds, real estate owned rents and any other income and
all other amounts received with respect to the Collateral.
SECTION 3.8. Collateral Sharing. All Collateral shall secure
all Secured Obligations for the benefit of both Lender and Bank, each
as a secured party. All rights and remedies of Lender under all
Collateral shall be held and exercised for the benefit of both Lender
and Bank. Borrower shall deal with Lender (only) as to all matters
within the scope of this Agreement, including future Advances,
repayments, releases, extensions, waivers, consents, enforcement of
rights and remedies, and all other matters. Lender shall have the
unilateral power, without any joinder, confirmation, or consent by
Bank, to issue any consents, waivers, or releases contemplated by this
Agreement and to exercise all rights and remedies of Lender and Bank
against all Collateral or otherwise under this Agreement. In doing so,
Lender may proceed in its own name or in the name of Bank and Lender
jointly, for which purpose Bank hereby appoints Lender as Bank's
attorney-in-fact. Lender and Bank shall share all proceeds from the
exercise of such rights or remedies in a pari passu manner except as
they shall agree otherwise in writing from time to time (such as a
junior/senior relationship if they shall so agree in writing). Any
consent or notice by Lender under this Agreement shall be fully
effective on behalf of both Lender and Bank. Lender and Bank shall have
the right
22
from time to time to enter into separate agreements as to their
relative interests in the Collateral and the exercise of rights and
remedies hereunder and the administration of this Agreement and the
Collateral, including Lender's appointment by Bank as Bank's
attorney-in-fact regarding the foregoing, but no such agreement shall
increase or decrease Borrower's rights or obligations under this
Agreement or the security for the Secured Obligations. Lender and Bank
may from time to time assign between one another their interests in the
Secured Obligations upon such terms as they shall agree, with or
without notice to Borrower.
6. Additional Covenants.
6.1. Section 6.1(a)(i) is modified by deleting the reference to "Eighty
Five Million Dollars ($85,000,000)" and replacing it with a reference to "One
Hundred Million Dollars ($100,000,000)."
6.2. Section 6.1(a)(ii) is deleted in its entirety and replaced with
the following:
Borrower shall maintain at all times a ratio of (a) earnings
before interest, taxes, depreciation, amortization, and noncash income,
gains, charges, and losses from time to time relating to or arising
from the Swap Confirmation to (b) interest expense of not less than
1.35:1. Any noncash income, gains, charges, and losses that, from time
to time, relate to or arise from the Swap Confirmation are and shall
continue to be reflected in the equity (shareholders' capital) section
of Borrower's balance sheet.
6.3. Section 6.1(c) is hereby added to the Original Credit Agreement,
as follows:
(c) For purposes of applying Section 6.1(a), Borrower's net
worth and the components thereof shall be determined in accordance with
GAAP as reflected in the financial statements certified by Borrower's
outside auditors and as set forth in the following sentence.
"Liabilities" shall consist of: (a) all items treated as "liabilities"
under GAAP; (b) any liabilities of other Persons that are secured by a
Lien on any asset of Borrower (whether or not such liabilities have
been assumed by Borrower); and, to the extent not otherwise included,
(c) Borrower's guaranty of any indebtedness of any other Person.
Notwithstanding anything to the contrary in this paragraph or elsewhere
in this Agreement, the parties acknowledge that "Liabilities" shall not
include Borrower's "Trust Preferred Securities," provided that such
"Trust Preferred Securities" are either approved by Lender in all
respects or are: (i) issued by any wholly owned special purpose
statutory business trust of Borrower, where (x) the sole asset of such
business trust consists of bonds, debentures, or similar debt
obligations of Borrower with a principal amount in excess of the total
liquidation value of such preferred securities,
23
and (y) the distributions, redemption payments, and liquidation
payments with respect to such preferred securities are unconditionally
and irrevocably guarantied by Borrower; and (ii) accounted for on the
balance sheet of Borrower, prepared by Borrower's outside auditors, in
a separate line located between total liabilities and shareholders
equity in accordance with GAAP.
6.4. Collateral Loan Documents. The following additional language is
added to the end of Section 6.9 of the Original --------------------------
Credit Agreement:
Borrower shall not, without Lender's prior written consent, agree or
consent to any waiver, release, modification, amendment, termination,
surrender, cancellation, or other action affecting any Collateral that
(in any of the foregoing cases) would have a Material Adverse Effect.
7. Events of Default.
7.1. At the end of Section 8.1(i), the word "or" is deleted. At the end
of Section 8.1(j), the period is modified to be a semicolon followed by the word
"or." The following new subsection of Section 8.1 is added:
(k) Borrower shall fail to pay the Line-Secured Swap
Termination Payment when required to be paid pursuant to this Agreement
(Borrower shall not be entitled to any further notice or opportunity to
cure such failure to pay.).
8. Notices.
8.1. Section 9.1 of the Original Credit Agreement is hereby amended by
adding the following before the sentence beginning "All Notices and other
communications":
and a copy to:
Midland Loan Services L.P.
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇. ▇▇▇ ▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
9. Covenants, Representations and Warranties of Borrower.
9.1. Borrower hereby reaffirms all terms, covenants, representations
and warranties made in the Security Documents as amended hereby.
9.2. Section 4.1(a) of the Original Credit Agreement is hereby amended
by replacing all references to the word "trust" with the word "corporate" and
replacing the word "California"
24
(as it appears in the second sentence) with the word "Maryland."
9.3. Section 4.1(b) of the Original Credit Agreement is hereby amended
by replacing all references to the word "trust" with the word "corporate" and
deleting the words "or the declaration of trust" (as it appears in sub-clause
(A)), "indenture," (as it appears in sub-clause (C)) and "trust indenture," (as
it appears in clause (iii)).
9.4. Section 4.1(n) of the Original Credit Agreement is hereby amended
by deleting the first bullet point, which sets forth the principal balance of
the Loan and provides a chart with Asset-Specific Loan Balances and LIBOR
Spreads. In the event of any dispute regarding such matters, such dispute shall
be resolved in the same manner as it would be resolved but for the execution of
this Amendment. By executing this Amendment, neither party shall be deemed to be
estopped in any way as to Assets, Asset-Specific Loan Balances, LIBOR Spreads,
or the principal balance of the Loan.
9.5. Borrower represents and warrants to Lender and Bank that (a)
Borrower has the legal power and authority to enter into this Amendment without
consent or approval by any third party and this Amendment constitutes the legal,
valid and binding obligation of Borrower, enforceable against Borrower in
accordance with its terms and (b) the execution and delivery by Borrower of this
Amendment has been duly authorized by all requisite action on the part of
Borrower and will not violate any provision of Borrower's organizational
documents.
9.6. Borrower represents and warrants to Lender and Bank that, as of
the Restatement Date, (a) no Default or Event of Default has occurred and is
continuing; (b) no Default or Event of Default will occur as a result of the
execution, delivery and performance by Borrower of this Amendment; (c) Borrower
has not given any notice of any uncured Default to Lender and (d) there are no
legal proceedings commenced or threatened against Lender by Borrower.
9.7. Borrower hereby confirms and acknowledges that Borrower has no
offsets, defenses, claims, counterclaims, setoffs, or other basis for reduction
with respect to any portion of the Indebtedness.
9.8. Borrower hereby agrees that a breach of any of the representations
and warranties made herein shall constitute an Event of Default under Section
8.1 of the Credit Agreement, subject to the notice and cure provisions provided
therein.
10. Lender's Acknowledgment.
10.1. Lender acknowledges to Borrower that, as of the Restatement Date,
both before and after giving effect to this Amendment: (a) Borrower is not in
default as to any obligation to pay Loan Fee, principal, and interest under the
Loan (other than any interest that was first due and payable on or after
February 1, 1999, as to which interest Lender neither asserts a default nor
confirms payment); (b) to the best of Lender's knowledge, Borrower is not in
default with respect to any other obligations under the Security Documents; (c)
to the best of Lender's knowledge all other fees and charges payable by Borrower
under the Security Documents have been paid (other than Lender's attorneys'
fees, which are handled separately); and (d) the
25
Maturity Date has been validly extended to the Maturity Date as defined in this
Amendment (before giving effect to Section 2.8 of this Amendment).
11. Effect Upon Security Documents; Trustee Exculpation.
11.1. Except as specifically set forth herein, the Security Documents
shall remain in full force and effect and are hereby ratified and confirmed for
the benefit of Lender and Bank. Borrower and Lender acknowledge and agree that
the Credit Agreement, as hereby amended, is in full force and effect in
accordance with its terms and has not been supplemented, modified or otherwise
amended, canceled, terminated or surrendered, except pursuant to this Amendment.
The Credit Agreement is binding and enforceable as against the parties hereto in
accordance with its terms. Any inconsistency between this Amendment and the
Credit Agreement (as it existed before this Amendment) shall be resolved in
favor of this Amendment, whether or not this Amendment specifically modifies the
particular provision(s) in the Credit Agreement inconsistent with this
Amendment. All references to the "Credit Agreement" in the Security Documents
and to the "Agreement" in the Credit Agreement shall mean and refer to the
Credit Agreement as modified and amended hereby.
11.2. The execution, delivery and effectiveness of this Amendment shall
not operate as a waiver of any right, power or remedy of Lender under the
Security Documents (except to the extent expressly set forth herein), or any
other document, instrument or agreement executed and/or delivered in connection
therewith.
11.3. As to the liability of Old Capital Trust only, the provisions of
this Amendment shall be subject to the provisions of Section 9.13 of the Credit
Agreement, which provisions are, as to Old Capital Trust only, incorporated by
reference as if herein set forth in full.
12. Miscellaneous.
12.1. THIS AMENDMENT SHALL BE CONSTRUED, INTERPRETED AND GOVERNED BY
THE LAW OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS CONFLICT OF LAWS
PRINCIPLES.
12.2. This Amendment may be executed in any number of counterparts, and
all such counterparts shall together constitute the same agreement.
12.3. As between Borrower and Lender, any future amendment or
modification to the Credit Agreement shall be fully effective when executed and
delivered by only Borrower and Lender, with no requirement for any joinder,
consent, or confirmation by Bank.
12.4. Bank shall have no obligations or liability under any Security
Document(s). To the extent that any secured party has any obligations or
liability under any Security Document(s), such obligations shall be performed
solely by, and such liability shall be borne and discharged solely by, Lender.
Borrower waives, releases, and covenants not to assert any claims against Bank
on account of the Security Documents. Such waiver, release and covenant by
Borrower shall not limit any right of BB Sub to assert against Bank any claims
arising out of the BB
26
Transaction Documents.
[No Further Text on This Page.]
27
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
executed as of the Restatement Date.
BORROWER:
--------
CAPITAL TRUST, INC.,
a Maryland corporation
By:/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ III
--------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ III
Title: Managing Director and Chief
Financial Officer
LENDER:
------
GERMAN AMERICAN CAPITAL
CORPORATION,
a Maryland corporation
By:/s/ ▇▇▇ ▇. ▇▇▇▇▇▇▇
--------------------------------------
Name: ▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Vice Pesident
By:/s/ ▇▇▇ ▇▇▇▇▇▇▇▇▇
--------------------------------------
Name: ▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: Authorized Sgnatory
▇▇
▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇ )
)
COUNTY OF NEW YORK )
)
-------------------------
On February 26, 1999, before me, the undersigned, a Notary Public in
and for said State, personally appeared ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ III, personally known
to me (or proved to me on the basis of satisfactory evidence) to be the
individual whose name is subscribed to the within instrument (the "Signer") and
acknowledged to me that the Signer executed the same in the Signer's capacity,
and that by the Signer's signature on the instrument, the Signer, or the person
upon behalf of which the Signer acted, executed the instrument.
/s/ ▇▇▇▇▇ ▇. Park
--------------------------------------
Notary Public
The undersigned hereby: (a) releases Lender from all obligations under the
Original Credit Agreement and (b) represents and warrants that (i) the
undersigned has not assigned, transferred, or encumbered the Credit Agreement
and (ii) CAPITAL TRUST, INC., a Maryland corporation, has succeeded to all
assets and all liabilities of the undersigned.
Capital Trust,
a California business trust
By:/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ III
-------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ III
Title: Managing Director and Chief
Financial Officer
29
The undersigned agrees to all the terms of the foregoing Amendment, and appoints
Lender as Bank's attorney in fact with respect to all Collateral and exercise of
rights and remedies under the Credit Agreement, but does not assume any
obligations under the foregoing Amendment or the Credit Agreement.
DEUTSCHE BANK AG, NEW YORK
BRANCH
By: /s/ ▇▇▇ ▇. ▇▇▇▇▇▇▇
-------------------------------
Name: ▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Attorney-in-Fact
By: /s/ ▇▇▇ ▇▇▇▇▇▇▇▇▇
-------------------------------
Name: ▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: Attorney-in-Fact
Exhibit A Restated Note (Copy)
30