▇▇▇▇▇ II REALTY TRUST, INC.
FIRST AMENDMENT
TO CREDIT AGREEMENT
This FIRST AMENDMENT TO CREDIT AGREEMENT (this "Amendment") is
dated as of December 17, 1997 and entered into by and among ▇▇▇▇▇ II Realty
Trust, Inc., a Maryland corporation ("Borrower"), the financial institutions
listed on the signature pages hereof ("Lenders") and Bankers Trust Company, as
agent for Lenders ("Agent"), and is made with reference to that certain Credit
Agreement dated as of February 27, 1997 (the "Credit Agreement"), by and among
Borrower, Lenders and Agent. Capitalized terms used herein without definition
shall have the same meanings herein as set forth in the Credit Agreement.
RECITALS
WHEREAS, Borrower and Lenders desire to amend the Credit
Agreement to increase the Commitments by $________* (the "Additional
Commitment") to $________* and make certain other amendments as set forth below;
NOW, THEREFORE, in consideration of the premises and the
agreements, provisions and covenants herein contained, the parties hereto agree
as follows:
Section 1. AMENDMENTS TO THE CREDIT AGREEMENT
1.1 Amendments to Section 1: Provisions Relating
to Defined Terms
A. Subsection 1.1 of the Credit Agreement is hereby amended by
adding thereto the following definitions, which shall be inserted in proper
alphabetical order:
"Beneficially Own" has the meaning assigned to such term in
the Common Stock Rights Agreement.
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* Material omitted pursuant to a request for Confidential Treatment and
filed separately with the Commission.
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"Custodial Agreement" means that certain Securities Account
Control Agreement dated as of December 17, 1997 by and between Agent, as Secured
Party and Bankers Trust Company, as Securities Intermediary.
"First Amendment" means that certain First Amendment to this
Agreement dated as of December 17, 1997 by and among Borrower, Lenders and
Agent.
"New Stock Purchase Agreement" means that certain Purchase
Agreement dated December 12, 1997 between Borrower and ▇▇▇▇▇, as amended,
supplemented or otherwise modified from time to time.
"Pledge Amendment" means that certain Pledge Amendment dated
as of December 17, 1997 to the Pledge Agreement dated as of February 27, 1997
between Borrower and Agent.
B. Subsection 1.1 of the Credit Agreement is hereby further
amended by deleting the definition of "Notes" therefrom in its entirety and
substituting the following therefor:
" 'Notes' means (i) the amended and restated promissory notes of
Borrower issued pursuant to the First Amendment to this Agreement substantially
in the form of Annex A annexed thereto and (ii) any promissory notes issued by
Borrower pursuant to the last sentence of subsection 9.1B(i) in connection with
assignments of the Commitments or Loans of any Lenders substantially in the form
of Exhibit III annexed hereto, in each case, as they may be amended,
supplemented or otherwise modified from time to time."
1.2 Amendments to Section 2: Amounts and Terms of
Commitments and Loans
A. Commitments. Subsection 2.1A of the Credit Agreement is
hereby amended by (i) deleting the reference to "$________*" contained therein
and substituting $________* therefor, (ii) inserting the words "and the First
Amendment Effective Date" after the words "Closing Date" in the third and tenth
lines thereof and (iii) inserting the words "or the First Amendment Effective
Date, as applicable" after the words Closing Date in the sixth line thereof.
B. Loans. Subsection 2.5A of the Credit Agreement is hereby
amended by deleting it in its entirety and substituting the following therefor:
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* Material omitted pursuant to a request for Confidential Treatment and
filed separately with the Commission.
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"A. Loans. The proceeds of the Loans shall be
applied by Borrower to (i) make a dividend or other distributions or payments to
Apollo or (ii) purchase ▇▇▇▇▇ Common Stock pursuant to the New Stock Purchase
Agreement."
1.3 Amendments to Section 4: Borrower's Representations and
Warranties
A. 4.5 Title to Properties; Liens. Subsection 4.5 of the
Credit Agreement is hereby amended by deleting the first sentence thereof in its
entirety and substituting the following therefor:
"Borrower has good title to all of the ▇▇▇▇▇ Common Stock set
forth on Schedule I to the Amended Pledge Agreement."
B. 4.15 ▇▇▇▇▇ Common Stock. Subsection 4.15 of the Credit
Agreement is hereby amended by deleting it in its entirety and substituting the
following therefor:
"4.15 ▇▇▇▇▇ Common Stock. Borrower Beneficially Owns 5,559,695
shares of ▇▇▇▇▇ Common Stock. None of Borrower's Affiliates Beneficially Owns
any ▇▇▇▇▇ Common Stock or any right to receive, subscribe for or otherwise
acquire any shares of ▇▇▇▇▇ Common Stock other than the 84,300 shares of ▇▇▇▇▇
Common Stock owned by Apollo Real Estates Investment Fund II, L.P."
1.4 Amendment to Section 6: Borrower's Negative Covenants
"6.3 Investments. Subsection 6.3 of the Credit Agreement is
hereby amended by deleting clause (ii) thereof and substituting the following
therefor:
"(ii) Borrower may make and own Investments in ▇▇▇▇▇ Common
Stock and rights to acquire ▇▇▇▇▇ Common Stock; provided that (a) Borrower and
its Affiliates shall at no time Beneficially Own more than __%* of the total
number of outstanding shares of ▇▇▇▇▇ Common Stock and (b) Borrower shall pledge
all such ▇▇▇▇▇ Common Stock and rights to acquire ▇▇▇▇▇ Common Stock in favor of
Agent pursuant to the Pledge Agreement."
1.5 Amendment to Section 7: Events of Default
Section 7 of the Credit Agreement is hereby amended by adding
the following proviso at the end of clause (ii) of the first paragraph following
subsection 7.14:
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* Material omitted pursuant to a request for Confidential Treatment and
filed separately with the Commission.
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"; provided that, if at the time of the occurrence of an Event
of Default described in clause (ii) hereof, (x) there are only two Lenders, (y)
Bankers is not a Lender, and (z) either BankBoston, N.A. or Bank of America,
National Trust and Savings Association is a Lender holding less than 50% of the
aggregate Loan Exposure of all Lenders then, if such Event of Default continues
for more than 90 days, the amounts described in clauses (a) and (b) above shall
be and the same shall forthwith become, immediately due and payable, and the
obligation of each Lender to make any Loan shall thereupon terminate.
1.6 Modification of Schedules
Schedule 2.1: Lenders' Commitments and Pro Rata Shares.
Schedule 2.1 to the Credit Agreement is hereby amended by deleting said Schedule
2.1 in its entirety and substituting in place thereof a new Schedule 2.1 in the
form of Annex B to this Amendment.
Schedule 4.8: Material Contracts. Schedule 4.8 to the Credit
Agreement is hereby amended by adding thereto the information contained in Annex
C to this Amendment.
Section 2. INTENTIONALLY OMITTED
Section 3. CONDITIONS TO EFFECTIVENESS
Notwithstanding anything to the contrary herein, this
Amendment shall become effective only upon the satisfaction of all of the
following conditions precedent (the date of satisfaction of such conditions
being referred to herein as the "First Amendment Effective Date"):
A. On or before the First Amendment Effective Date, Borrower
shall deliver to Lenders (or to Agent for Lenders with sufficient originally
executed copies, where appropriate, for each Lender and its counsel) the
following, each, unless otherwise noted, dated the First Amendment Effective
Date:
1. Certified copies of any amendments made to its
Articles of Incorporation on or after February 27, 1997 (the "Prior
Delivery Date"), certified as of the First Amendment Effective Date by
its corporate secretary or assistant secretary as being the only
amendments thereto since the Prior Delivery Date (or, if there have
been no such amendments since the Prior Delivery Date, a certificate of
its corporate secretary or assistant secretary to that effect) together
with a good standing certificate from the Secretary of State of the
State of Maryland dated a recent date prior to the First Amendment
Effective Date;
2. Copies of any amendments made to its Bylaws on or
after Prior Delivery Date, certified as of the First Amendment
Effective Date by its corporate secretary or assistant secretary as
being the only amendments thereto since the Prior
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Delivery Date (or, if there have been no such amendments since the
Prior Delivery Date, a certificate of its corporate secretary or
assistant secretary to that effect);
3. Resolutions of its Board of Directors approving
and authorizing the execution, delivery, and performance of this
Amendment and the Pledge Amendment and approving and authorizing the
execution, delivery and payment of the Amended and Restated Notes,
certified as of the First Amendment Effective Date by its corporate
secretary or an assistant secretary as being in full force and effect
without modification or amendment;
4. Signature and incumbency certificates of its
officers executing this Amendment, the Pledge Amendment and the Amended
and Restated Notes (as hereinafter defined); and
5. Executed copies of this Amendment, the Pledge
Amendment and the amended and restated Notes (substantially in the form
of Annex A to this Amendment, drawn to the order of each Lender and
with appropriate insertions) (the "Amended and Restated Notes").
B. Agent shall have received all documents or instruments, and
Borrower shall have taken all actions, necessary or advisable, in the opinion of
Agent and its counsel, to create and maintain a perfected security interest in
favor of Agent, in all of the Collateral pledged under the Amended Pledge
Agreement (as hereinafter defined) including (i) evidence that all Pledged
Shares (as defined in the Amended Pledge Agreement) are held in the securities
account maintained by Bankers Trust Company in the name "BTCO/▇▇▇▇▇ II REALTY
TRUST, INC. COLLATERAL ACCOUNT" and (ii) the delivery to Agent of UCC- 3
amendments revising the collateral description to include the New Stock Purchase
Agreement as an "Assigned Agreement".
C. Borrower shall have obtained all Governmental
Authorizations and all consents of other Persons that are necessary or that
Agent may request in connection with the transactions contemplated hereby, all
in form and substance satisfactory to the Agent. In addition, Borrower shall
have entered into amendments of, or supplements to, each Related Agreement to
the extent necessary or that Agent may request in connection with the
transactions contemplated hereby, all in form and substance satisfactory to the
Agent. Without limiting the generality of the foregoing:
(i) *
(i) *
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* Material omitted pursuant to a request for Confidential Treatment and
filed separately with the Commission.
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D. Lenders and their respective counsel shall have received
originally executed copies of one or more favorable written opinions of Battle
▇▇▇▇▇▇, ▇.▇., counsel for Borrower, in form and substance reasonably
satisfactory to Agent and its counsel, dated as of the First Amendment Effective
Date with respect to the enforceability of the Amended Agreement and the Amended
Pledge Agreement and as to such other matters as Agent acting on behalf of
Lenders may reasonably request.
E. Lenders and their respective counsel shall have received
originally executed copies of one or more favorable written opinions of ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇, Maryland counsel for Borrower, in form and substance
reasonably satisfactory to Agent and its counsel, dated as of the First
Amendment Effective Date with respect to the enforceability of the Amended
Agreement and the Amended Pledge Agreement and as to such other matters as Agent
acting on behalf of Lenders may reasonably request.
F. Agent shall have received from Borrower an amendment fee in
an amount equal to __%* of the Additional Commitment.
G. The "Settlement Date" under the Assignment Agreement
between Bankers Trust Company, BankBoston, N.A. and Bank of America, National
Trust and Savings Association, N.A. shall have occurred.
H. On or before the First Amendment Effective Date, all
corporate and other proceedings taken or to be taken in connection with the
transactions contemplated hereby and all documents incidental thereto not
previously found acceptable by Agent, acting on behalf of Lenders, and its
counsel shall be satisfactory in form and substance to Agent and such counsel,
and Agent and such counsel shall have received all such counterpart originals or
certified copies of such documents as Agent may reasonably request.
Section 4. BORROWER'S REPRESENTATIONS AND WARRANTIES
In order to induce Lenders to enter into this Amendment and to
amend the Credit Agreement in the manner provided herein, Borrower represents
and warrants to each Lender that the following statements are true, correct and
complete:
A. Corporate Power and Authority. Borrower has all requisite
corporate power and authority to enter into this Amendment and the Pledge
Amendment, to issue the Amended and Restated Notes and to carry out the
transactions contemplated by, and perform its obligations under, the Credit
Agreement as amended by this Amendment (the "Amended Agreement") and the Pledge
Agreement as amended by the Pledge Amendment (the "Amended Pledge Agreement").
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* Material omitted pursuant to a request for Confidential Treatment and
filed separately with the Commission.
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B. Authorization of Agreements. The execution and delivery of
this Amendment, the Pledge Amendment and the Amended and Restated Notes, the
performance of the Amended Agreement and the Amended Pledge Agreement and the
issuance, delivery and payment of the Amended and Restated Notes have been duly
authorized by all necessary corporate action on the part of Borrower.
C. No Conflict. The execution and delivery by Borrower of this
Amendment, the Pledge Amendment and the performance by Borrower of the Amended
Agreement and the Amended Pledge Agreement, and the issuance, delivery and
payment of the Amended and Restated Notes by Borrower do not and will not (i)
violate any provision of any law or any governmental rule or regulation
applicable to Borrower, the Articles of Incorporation or Bylaws of Borrower or
any order, judgment or decree of any court or other agency of government binding
on Borrower, (ii) conflict with, result in a breach of or constitute (with due
notice or lapse of time or both) a default under any contractual obligation of
Borrower, (iii) result in or require the creation or imposition of any Lien upon
any of the properties or assets of Borrower (other than Liens created under any
of the Loan Documents in favor of Agent on behalf of Lenders), or (iv) require
any approval of stockholders or any approval or consent of any Person under any
contractual obligation of Borrower, except for such approvals or consents which
have been obtained on or before the First Amendment Effective Date and disclosed
in writing to Lenders.
D. Governmental Consents. The execution and delivery by
Borrower of this Amendment and the Pledge Amendment and the performance by
Borrower of the Amended Agreement and the Amended Pledge Agreement and the
issuance, delivery and payment of the Amended and Restated Notes by Borrower do
not and will not require any registration with, consent or approval of, or
notice to, or other action to, with or by, any federal, state or other
governmental authority or regulatory body.
E. Binding Obligation. This Amendment, the Amended Agreement,
the Pledge Amendment and the Amended Pledge Agreement have been duly executed
and delivered by Borrower and are, and the Amended and Restated Notes, when
executed and delivered, will be the legally valid and binding obligations of
Borrower, enforceable against Borrower in accordance with their respective
terms, except as may be limited by bankruptcy, insolvency, reorganization,
moratorium or similar laws relating to or limiting creditors' rights generally
or by equitable principles relating to enforceability.
F. Incorporation of Representations and Warranties From Credit
Agreement. The representations and warranties contained in Section 4 of the
Credit Agreement are and will be true, correct and complete in all material
respects on and as of the First Amendment Effective Date to the same extent as
though made on and as of that date, except to the extent such representations
and warranties specifically relate to an earlier date or are amended hereby, in
which case they were true, correct and complete in all material respects on and
as of such earlier date or as amended hereby.
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G. Absence of Default. No event has occurred and is continuing
or will result from the consummation of the transactions contemplated by this
Amendment that would constitute an Event of Default or a Potential Event of
Default.
Section 5. ACKNOWLEDGEMENT AND CONSENT
Borrower is a party to the Amended Pledge Agreement, pursuant
to which Borrower has created Liens in favor of Agent on certain Collateral to
secure the Obligations. Borrower hereby acknowledges that it has reviewed the
terms and provisions of the Credit Agreement and this Amendment and consents to
the amendment of the Credit Agreement effected pursuant to this Amendment.
Borrower hereby confirms that the Amended Pledge Agreement and all Collateral
encumbered thereby will continue to secure to the fullest extent possible the
payment and performance of all "Secured Obligations" (as such term is defined in
the Amended Pledge Agreement), including without limitation the payment and
performance of all such "Secured Obligations," in respect of the Obligations of
Borrower now or hereafter existing under or in respect of the Amended Agreement
and the Notes defined therein. Without limiting the generality of the foregoing,
Borrower hereby acknowledges and confirms the understanding and intent of such
party that, upon the effectiveness of this Amendment, and as a result thereof,
the definition of "Obligations" contained in the Amended Agreement includes the
obligations of Borrower under the Amended and Restated Notes.
Borrower acknowledges and agrees that the Amended Pledge
Agreement shall continue in full force and effect and that all of its
obligations thereunder shall be valid and enforceable and shall not be impaired
or limited by the execution or effectiveness of this Amendment. Borrower
represents and warrants that all representations and warranties contained in the
Amended Pledge Agreement are true, correct and complete in all material respects
on and as of the First Amendment Effective Date to the same extent as though
made on and as of that date, except to the extent such representations and
warranties specifically relate to an earlier date, in which case they were true,
correct and complete in all material respects on and as of such earlier date.
Section 7. MISCELLANEOUS
A. Reference to and Effect on the Credit Agreement and the
Other Loan Documents.
(i) On and after the First Amendment Effective Date, each
reference in the Credit Agreement to "this Agreement", "hereunder",
"hereof", "herein" or words of like import referring to the Credit
Agreement, and each reference in the other Loan Documents to the
"Credit Agreement", "thereunder", "thereof" or words of like import
referring to the Credit Agreement shall mean and be a reference to the
Amended Agreement.
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(ii) Except as specifically amended by this Amendment, the
Credit Agreement and the other Loan Documents shall remain in full
force and effect and are hereby ratified and confirmed.
(iii) The execution, delivery and performance of this
Amendment shall not, except as expressly provided herein, constitute a
waiver of any provision of, or operate as a waiver of any right, power
or remedy of Agent or any Lender under, the Credit Agreement or any of
the other Loan Documents.
B. Fees and Expenses. Borrower acknowledges that all costs,
fees and expenses as described in subsection 9.2 of the Credit Agreement
incurred by Agent and its counsel with respect to this Amendment and the
documents and transactions contemplated hereby shall be for the account of
Borrower.
C. Headings. Section and subsection headings in this Amendment
are included herein for convenience of reference only and shall not constitute a
part of this Amendment for any other purpose or be given any substantive effect.
D. Applicable Law. THIS AMENDMENT AND THE RIGHTS AND
OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE GOVERNED BY, AND SHALL BE
CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW
YORK (INCLUDING WITHOUT LIMITATION SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAW
OF THE STATE OF NEW YORK), WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES.
E. Counterparts; Effectiveness. This Amendment may be executed
in any number of counterparts and by different parties hereto in separate
counterparts, each of which when so executed and delivered shall be deemed an
original, but all such counterparts together shall constitute but one and the
same instrument; signature pages may be detached from multiple separate
counterparts and attached to a single counterpart so that all signature pages
are physically attached to the same document. This Amendment shall become
effective upon the execution of a counterpart hereof by Borrower and Lenders and
receipt by Borrower and Agent of written or telephonic notification of such
execution and authorization of delivery thereof.
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IN WITNESS WHEREOF, the parties hereto have caused this
Amendment to be duly executed and delivered by their respective officers
thereunto duly authorized as of the date first written above.
▇▇▇▇▇ II REALTY TRUST, INC.
By: /s/▇▇▇▇ ▇▇▇▇▇▇▇▇▇
--------------------------------
Name: ▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: Vice President
BANKERS TRUST COMPANY, individually and as
Agent
By: /s/
--------------------------------
Name:
Title:
BANKBOSTON, N.A., as a Lender
By: /s/
-------------------------------
Name:
Title:
BANK OF AMERICA, NATIONAL TRUST AND
SAVINGS ASSOCIATION, N.A., as a Lender
By: /s/
--------------------------------
Name:
Title:
S-1