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EXHIBIT 10.36
FIRST AMENDMENT TO AMENDED
AND RESTATED CREDIT AGREEMENT
THIS FIRST AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT is
dated as of November 21, 2000 (this "Amendment"), and is among MHC OPERATING
LIMITED PARTNERSHIP, an Illinois limited partnership ("Borrower"), MANUFACTURED
HOME COMMUNITIES, INC., a Maryland corporation (the "REIT"), each of the
undersigned "Lenders", ▇▇▇▇▇ FARGO BANK, NATIONAL ASSOCIATION, in its capacity
as "Agent", BANK OF AMERICA N.A., formerly known as BANK OF AMERICA NATIONAL
TRUST AND SAVINGS ASSOCIATION, in its capacity as "Syndication Agent", and
▇▇▇▇▇▇ GUARANTY TRUST COMPANY OF NEW YORK, as "Documentation Agent". Capitalized
terms used herein and not defined herein shall have the meanings ascribed to
them in the Credit Agreement referenced below.
WHEREAS, the parties hereto have previously entered into that
certain Amended and Restated Credit Agreement dated as of April 28, 1998 (as
heretofore amended, the "Credit Agreement");
WHEREAS, Commerzbank Aktiengesellschaft, New York Branch, has
succeeded to the rights and obligations of Commerzbank Aktiengesellschaft,
Chicago Branch under the Credit Agreement;
WHEREAS, pursuant to Section 2.01(d) of the Credit Agreement, the
maturity of the Loan has been extended to April 3, 2002; and
WHEREAS, the parties hereto desire to (i) appoint ▇▇▇▇▇ Fargo Bank,
N.A. ("▇▇▇▇▇ Fargo") as "Sole Lead Arranger" for the Facility, and (ii)
otherwise amend the Credit Agreement as provided herein.
NOW, THEREFORE, in consideration of the foregoing and the mutual
agreements herein contained, the parties hereto agree as follows:
1. DEFINITIONS. Section 1.01 of the Credit Agreement is
hereby amended as follows:
a. DEBT SERVICE. The definition of "Debt Service" is hereby
deleted in its entirety and replaced with the following language:
"Debt Service" means, for any period, Interest Expense for
such period plus scheduled principal amortization (exclusive of
Balloon Payments) for such period on all Indebtedness of the REIT,
on a consolidated basis.
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b. EBITDA. The definition of "EBITDA" is hereby amended to add
the following language after clause (vi) thereof and before the period:
", plus (or minus in the case of a loss) (vii) Borrower's
Share of the net income (or loss) of each Investment Affiliate for
such period calculated in conformity with GAAP before depreciation,
minus (or plus in the case of a loss) (viii) Borrower's Share of the
gains (or losses) from extraordinary or unusual items or asset sales
or write-ups or forgiveness of indebtedness included in the
calculation of the net income of each Investment Affiliate for such
period."
▇. ▇▇▇▇▇ ASSET VALUE. The parenthetical phrase in the
definition of "Gross Asset Value" is hereby deleted and replaced with the
following language: "(subject to the last sentence of Section 8.08)".
d. INTEREST EXPENSE. The definition of "Interest Expense" is
hereby deleted and replaced with the following language:
"Interest Expense" means, for any period and without
duplication, total interest expense, whether paid, accrued or
capitalized (including the interest component of Capital Leases but
excluding interest expense covered by an interest reserve
established under a loan facility) of the REIT, on a consolidated
basis and determined in accordance with GAAP.
e. NET INCOME. The definition of "Net Income" is hereby
amended to add the following language at the end thereof and before the
period:
"; provided, however, that Net Income shall not include the
net income (or loss) of Investment Affiliates"
f. NET WORTH. The definition of "Net Worth" is hereby amended
to delete the last sentence thereof in its entirety and to replace the
reference to "September 30, 1996" with "March 31, 2000."
g. NON-MANUFACTURED HOME COMMUNITY PROPERTY. The definition of
"Non-Manufactured Home Community Property" is hereby amended to delete the
word "or" before clause (v) thereof and replace it with a comma, and to
add the following language at the end thereof before the period: "or (vi)
Taxable REIT Subsidiary Interests."
h. NON-RECOURSE INDEBTEDNESS. The definition of "Non-Recourse
Indebtedness" is hereby deleted and replaced with the following:
"Non-Recourse Indebtedness" means any single loan with respect
to which recourse for payment is limited to specific assets related
to a particular Property or
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group of Properties encumbered by a Lien securing such Indebtedness,
so long as the Adjusted Asset Value for such Property, or the total
of the Adjusted Asset Values for such group of Properties, does not
exceed One Hundred Million Dollars ($100,000,000); provided,
however, that personal recourse to the REIT, Borrower or any
Subsidiary by a holder of any such loan for fraud,
misrepresentation, misapplication of cash, waste, environmental
claims and liabilities and other circumstances customarily excluded
by institutional lenders from exculpation provisions and/or included
in separate indemnification agreements in non-recourse financing of
real estate shall not, by itself, prevent such loan from being
characterized as Non-Recourse Indebtedness.
i. RECOURSE INDEBTEDNESS. The following defined term is hereby
added:
"Recourse Indebtedness" means, with respect to any Person,
Indebtedness which is not Non-Recourse Indebtedness.
j. REQUISITE LENDERS. The definition of "Requisite Lenders" is
hereby deleted in its entirety and replaced with the following language:
"Requisite Lenders" means, collectively Lenders whose Pro Rata
Shares, in the aggregate, are at least sixty-six and two-thirds
percent (66 2/3%); provided, however, that the Requisite Lenders
must be comprised of a minimum of two (2) Lenders; and provided,
further, that for purposes of any amendment, modification or waiver
of the requirements of Article VIII, the Requisite Lenders must
include Agent in its capacity as a Lender."
k. SUPERMAJORITY LENDERS. The definition of "Supermajority
Lenders" is hereby deleted in its entirety and replaced with the following
language:
"Supermajority Lenders" means, collectively Lenders whose Pro
Rata Shares, in the aggregate, are at least eighty five percent
(85%); provided, however, that the Supermajority Lenders must be
comprised of a minimum of two (2) Lenders; and provided, further,
that for purposes of any amendment, modification or waiver of the
requirements of Article VIII, the Supermajority Lenders must include
Agent in its capacity as a Lender."
l. TAXABLE REIT SUBSIDIARY INTERESTS. The following defined
term is hereby added:
"Taxable REIT Subsidiary Interests" means equity interests in
Subsidiaries not engaged in the development, ownership or operation
of real estate and permitted to be held by Borrower and the REIT
pursuant to Section 856(l) of the
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Internal Revenue Code (as amended from time to time) without
violating the REIT's status as a real estate investment trust."
m. TOTAL LIABILITIES. The definition of "Total Liabilities" is
hereby deleted in its entirety and replaced with the following language:
"Total Liabilities" means, without duplication, all
Indebtedness of the REIT, on a consolidated basis, plus all other
items which, in accordance with GAAP, would be included as
liabilities on the liability side of the balance sheet of the REIT
(including, without limitation, accounts payable incurred in the
ordinary course of business), on a consolidated basis; provided,
however, that "Total Liabilities" shall not include dividends
declared by the REIT or Borrower which are permitted under Section
7.01(d) but not yet paid.
n. WHOLLY-OWNED SUBSIDIARY. The following defined term is
hereby added:
"Wholly-Owned Subsidiary" means any Subsidiary which is
wholly-owned directly or indirectly by Borrower or the REIT.
2. REPRESENTATIONS AND WARRANTIES. Subsections 4.01(w) and 4.02(t)
of the Credit Agreement are hereby deleted in their entirety.
3. NEGATIVE COVENANTS. Article VII of the Credit Agreement is hereby
amended as follows:
a. BORROWER'S COVENANT WITH RESPECT TO INDEBTEDNESS.
Subsection 7.01(a) is hereby deleted in its entirety and replaced with the
following language:
(a) Indebtedness. Borrower shall not, and shall not
permit any of its Subsidiaries to, directly or indirectly create,
incur, assume or otherwise become or remain directly or indirectly
liable with respect to, any Indebtedness, except:
(i) the Obligations;
(ii) trade debt incurred in the normal course
of business;
(iii) intercompany payables and receivables owing
between Subsidiaries in the nature of trade debt incurred in
the normal course of business;
(iv) Indebtedness which, after giving effect
thereto, may be incurred or may remain outstanding without
giving rise to an Event of
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Default or Unmatured Event of Default under any provision of
Articles VII and VIII; provided, however, that (A) Borrower
shall not, and shall not permit any of its Subsidiaries to,
guarantee or otherwise become or remain directly or indirectly
liable with respect to the Indebtedness of any Investment
Affiliate, and (B) Borrower shall not permit any Wholly-Owned
Subsidiary to create, incur, assume or otherwise become or
remain directly or indirectly liable with respect to, any
Recourse Indebtedness in excess of Ten Million Dollars
($10,000,000) per Wholly-Owned Subsidiary at any time or
Thirty Million Dollars ($30,000,000) in the aggregate for all
Wholly-Owned Subsidiaries at any time.
b. BORROWER'S COVENANT WITH RESPECT TO LIENS. Clause (ii) of
Subsection 7.01(b) is hereby deleted in its entirety and replaced with the
following language:
(ii) Liens securing Indebtedness permitted to be
incurred and remain outstanding pursuant to Section
7.01(a)(iv).
c. REIT'S COVENANT WITH RESPECT TO INDEBTEDNESS. Subsection
7.02(a) is hereby deleted in its entirety and replaced with the following
language:
(a) Indebtedness. The REIT shall not, and shall not
permit any of its Subsidiaries to, directly or indirectly create,
incur, assume or otherwise become or remain directly or indirectly
liable with respect to, any Indebtedness, except:
(i) the Obligations; and
(ii) Indebtedness which, after giving effect
thereto, may be incurred or may remain outstanding without
giving rise to an Event of Default or Unmatured Event of
Default under any provision of Articles VII and VIII;
provided, however, that (A) the REIT shall not, and shall not
permit any of its Subsidiaries to, guarantee or otherwise
become or remain directly or indirectly liable with respect to
the Indebtedness of any Investment Affiliate, and (B) the REIT
shall not permit any Wholly-Owned Subsidiary to create, incur,
assume or otherwise become or remain directly or indirectly
liable with respect to, any Recourse Indebtedness in excess of
Ten Million Dollars ($10,000,000) per Wholly-Owned Subsidiary
at any time or Thirty Million Dollars ($30,000,000) in the
aggregate for all Wholly-Owned Subsidiaries at any time.
4. FINANCIAL COVENANTS. Article VIII of the Credit Agreement is
hereby amended as follows:
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a. SECURED DEBT TO GROSS ASSET VALUE. The numerical reference
in Section 8.02 to "0.4:1" is hereby deleted and replaced with the
following: "0.5:1".
b. MINIMUM NET WORTH. Section 8.07 is hereby deleted in its
entirety and replaced with the following language:
"9.07. Minimum Net Worth. Borrower will maintain a Net Worth
of not less than Three Hundred Twenty Two Million Dollars
($322,000,000) plus ninety percent (90%) of all Net Offering
Proceeds received by the REIT or Borrower after August 9, 2000."
c. PERMITTED HOLDINGS. Taxable REIT Subsidiary Interests are
hereby added as a category of Permitted Holdings under Section 8.08 with a
Maximum Percentage of Gross Asset Value of five percent (5%). The last
sentence of Section 8.08 is hereby deleted in its entirety and replaced
with the following language:
"Gross Asset Value as it relates to the foregoing categories
of Permitted Holdings shall be calculated as follows: (i) the Gross
Asset Value attributable to any Non-Manufactured Home Community
Property (other than cash or Cash Equivalents), any Manufactured
Home Community Mortgage (other than mortgage indebtedness which is
either eliminated in the consolidation of the REIT, Borrower and the
Subsidiaries or accounted for as investment in real estate under
GAAP) or any Manufactured Home Community Partnership Interest (other
than a Controlled Partnership Interest) shall be calculated based
upon its Adjusted Asset Value; (ii) the Gross Asset Value
attributable to any Land or any Security issued by a real estate
investment trust primarily engaged in the development, ownership and
management of manufactured home communities shall be equal to the
lesser of (A) the acquisition cost thereof or (B) the current market
value thereof (such market value to be determined in a manner
reasonably acceptable to Agent); (iii) the Gross Asset Value
attributable to any Taxable REIT Subsidiary Interest shall be the
acquisition or investment cost thereof; and (iv) the Gross Asset
Value attributable to any Development Activity shall be determined
in accordance with GAAP."
5. AGENCY PROVISIONS. The second sentence of Section 10.08 of the
Credit Agreement is hereby deleted in its entirety and replaced with the
following language:
"The terms "Lenders", "Requisite Lenders", "Supermajority Lenders",
or any similar terms may include Agent in its individual capacity as
a Lender, one of the Requisite Lenders or one of the Supermajority
Lenders, but Requisite Lenders and Supermajority Lenders shall not
include Agent solely in its capacity as Agent."
6. APPOINTMENT OF SOLE LEAD ARRANGER. From and after the date
hereof, ▇▇▇▇▇ Fargo shall be the "Sole Lead Arranger" for the Facility. The Sole
Lead Arranger shall not
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be required to take any action or assume any liability except as may be required
in its capacity as a Lender or Agent under the Credit Agreement. For purposes of
the indemnifications set forth in the Credit Agreement, the term "Agent" shall
be deemed to include the Sole Lead Arranger.
7. CONDITIONS TO EFFECTIVENESS. The effectiveness of this Amendment
is subject to satisfaction of each of the following conditions precedent:
a. LEGAL OPINION. Borrower shall have delivered to Agent for
the benefit of the Lenders a favorable opinion of counsel for Borrower and
the REIT in form and substance reasonably satisfactory to Agent and its
counsel; and
b. EVIDENCE OF AUTHORITY. Borrower shall have delivered to
Agent for the benefit of the Lenders such evidence as Agent shall
reasonably require of the existence, good standing and authority of
Borrower and the REIT and the incumbency and authority of their respective
signatories.
8. CONSENT OF THE REIT AND REAFFIRMATION OF THE REIT Guaranty. The
REIT hereby consents to the terms of this Amendment and agrees that the REIT
Guaranty remains valid and enforceable and that the REIT has no defenses or
offsets to enforcement against the REIT under the REIT Guaranty.
9. REPRESENTATIONS AND WARRANTIES. Borrower hereby represents and
warrants as follows:
a. AUTHORITY OF BORROWER. Borrower has the requisite
partnership power and authority to execute, deliver and perform this
Amendment. The execution, delivery and performance thereof, and the
consummation of the transactions contemplated hereby, have been duly
approved by the general partner of Borrower, and no other partnership
proceedings or authorizations on the part of Borrower or its general or
limited partners are necessary to consummate such transactions. This
Amendment has been duly executed and delivered by Borrower and constitutes
its legal, valid and binding obligation, enforceable against it in
accordance with its terms, subject to bankruptcy, insolvency and other
laws affecting creditors' rights generally and general equitable
principles.
b. AUTHORITY OF THE REIT. The REIT has the requisite corporate
power and authority to execute, deliver and perform this Amendment. The
execution, delivery and performance hereof, and the consummation of the
transactions contemplated hereby, have been duly approved by the Board of
Directors of the REIT, and no other corporate proceedings on the part of
the REIT are necessary to consummate such transactions. This Amendment has
been duly executed and delivered by the REIT and constitutes its legal,
valid and binding obligation, enforceable against it in accordance with
its terms, subject to bankruptcy, insolvency and other laws affecting
creditors' rights generally and general equitable principles.
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c. NO CONFLICT AS TO BORROWER. The execution, delivery and
performance by Borrower of this Amendment, and each of the transactions
contemplated hereby, do not and will not (i) conflict with or violate
Borrower's limited partnership agreement or Certificate of Limited
Partnership or other organizational documents, as the case may be, or the
organizational documents of any Subsidiary of Borrower or (ii) conflict
with, result in a breach of or constitute (with or without notice or lapse
of time or both) a default under any Requirement of Law, Contractual
Obligation or Court Order of or binding upon Borrower or any of its
Subsidiaries, or require termination of any such Contractual Obligation,
the consequences of which conflict or breach or default or termination
would have a Material Adverse Effect, or result in or require the creation
or imposition of any Lien whatsoever upon any Property (except as
contemplated herein).
d. NO CONFLICT AS TO THE REIT. The execution, delivery and
performance by the REIT of this Amendment, and each of the transactions
contemplated hereby, do not and will not (i) conflict with or violate its
Articles or Certificate of Incorporation or by-laws, or other
organizational documents, as the case may be, or the organizational
documents of Borrower or any Subsidiary, (ii) conflict with, result in a
breach of or constitute (with or without notice or lapse of time or both)
a default under any Requirement of Law, Contractual Obligation or Court
Order of the REIT, Borrower or any Subsidiary, or require termination of
any such Contractual Obligation, the consequences of which conflict or
breach or default or termination will have a Material Adverse Effect, or
result in or require the creation or imposition of any Lien whatsoever
upon any of its Property, or (iii) require any approval of the
stockholders of the REIT.
e. CONSENTS AND AUTHORIZATIONS. Each of Borrower and the REIT
has obtained all consents and authorizations required pursuant to its
Contractual Obligations with any other Person, the failure of which to
obtain would have a Material Adverse Effect, and has obtained all consents
and authorizations of, and effected all notices to and filings with, any
Governmental Authority necessary to allow Borrower or the REIT, as
applicable, to lawfully execute, deliver and perform its obligations under
this Amendment.
f. DATE DOWN OF REPRESENTATIONS AND WARRANTIES. All of the
representations and warranties contained in the Credit Agreement and in
the other Loan Documents are true and correct in all material respects on
and as of the date hereof except to the extent such representation and
warranty is made as of a specified date, in which case such representation
and warranty is true and correct as of such specified date.
g. NO EVENT OF DEFAULT OR UNMATURED EVENT OF DEFAULT. No Event
of Default or Unmatured Event of Default exists as of the date hereof.
h. NET WORTH. The Net Worth as of March 31, 2000 was Three
Hundred Seventy Eight Million Eight Hundred Seventy Thousand Dollars
($378,870,000).
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10. EFFECT ON CREDIT AGREEMENT. The Credit Agreement and all other
Loan Documents (each as amended, supplemented or otherwise modified hereby)
shall remain in full force and effect and are hereby ratified and confirmed in
all respects. Except as expressly provided herein or pursuant hereto, the
execution, delivery, performance and effectiveness of this Amendment shall not
operate as a waiver of any right, power or remedy of Agent or any Lender under
the Loan Documents, nor constitute a waiver of any provisions of any of the Loan
Documents.
11. MISCELLANEOUS
a. EXECUTION IN COUNTERPARTS. This Amendment may be executed
in any number of counterparts, and each such counterpart, when so executed
and delivered, shall be deemed to be an original and binding upon the
party signing such counterpart; all such counterparts taken together shall
constitute one and the same instrument.
b. GOVERNING LAW. THIS AMENDMENT SHALL BE GOVERNED BY, AND
SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE
OF ILLINOIS.
c. HEADINGS. Section 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.
d. ENTIRE AGREEMENT. This Amendment is the entire agreement
among the parties with respect to the matters addressed herein, and may
not be modified except by written modification signed by all parties
hereto.
e. SUCCESSORS AND ASSIGNS. This Amendment shall be binding
upon and inure to the benefit of the parties hereto and their respective
heirs, successors, personal representatives and assigns (as permitted
under the Credit Agreement).
f. EXPENSES. Pursuant to Section 11.01(a) of the Credit
Agreement, Borrower hereby agrees to promptly pay all reasonable
attorneys' fees and expenses or other costs or expenses incurred by Agent
in connection with this Amendment and the transactions contemplated
hereby.
[SIGNATURE PAGES FOLLOW]
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IN WITNESS WHEREOF, this Amendment has been duly executed as of the
date set forth above.
MHC OPERATING LIMITED PARTNERSHIP, an Illinois
limited partnership
By: MANUFACTURED HOME COMMUNITIES, INC.,
a Maryland corporation, as General Partner
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: VP and Chief Financial Officer
MANUFACTURED HOME COMMUNITIES, INC., a Maryland
corporation
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: VP and Chief Financial Officer
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▇▇▇▇▇ FARGO BANK, NATIONAL ASSOCIATION, as
Agent, Sole Lead Arranger and a Lender
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President
Commitment: $40,000,000.00
Pro Rata Share: 40%
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BANK OF AMERICA N.A., formerly known as BANK OF
AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION,
as Syndication Agent and a Lender
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: Principal
Commitment: $20,000,000.00
Pro Rata Share: 20%
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COMMERZBANK AKTIENGESELLSCHAFT, New York
Branch, as a Lender
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Vice President
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: Assistant Vice President
Commitment: $20,000,000.00
Pro Rata Share: 20%
▇-▇
▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ TRUST COMPANY OF NEW YORK, as
Documentation Agent and a Lender
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇.
----------------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇.
Title: Associate
Commitment: $20,000,000.00
Pro Rata Share: 20%
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