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EXHIBIT 10.12
SECOND AMENDED AND RESTATED REVOLVING CREDIT AND
TERM LOAN AGREEMENT
DATED AS OF OCTOBER 1, 1997
AMONG
RFS PARTNERSHIP, L.P.,
AS BORROWER,
RFS HOTEL INVESTORS, INC.,
AS GUARANTOR,
NATIONSBANK, N.A.,
AS AGENT AND LENDER, AND
THE SEVERAL OTHER LENDERS
FROM TIME TO TIME PARTIES HERETO
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SECOND AMENDED AND RESTATED REVOLVING CREDIT AND
TERM LOAN AGREEMENT
This Second Amended and Restated Revolving Credit and Term Loan Agreement,
dated as of October 1, 1997 is among RFS PARTNERSHIP, L.P., a Tennessee limited
partnership, (the "Borrower"), RFS HOTEL INVESTORS, INC., a Tennessee
corporation (the "Guarantor"), the several banks, financial institutions and
other entities from time to time parties to this Agreement (collectively, the
"Lenders"), and NATIONSBANK, N.A., a national banking association, (the
"Agent").
RECITALS
A. The Borrower is primarily engaged in the business of purchasing,
developing, owning, operating, leasing, managing, financing and selling Hotel
Properties (as defined herein).
B. The Guarantor is the sole general partner of the Borrower and the
Guarantor is qualified as a real estate investment trust with its common stock
listed on the New York Stock Exchange.
C. Boatmen's Bank of Tennessee ("BBOT") has heretofore made loans available
to the Guarantor, formerly as borrower, in the maximum aggregate principal
amount of $75,000,000 (hereinafter as modified and/or increased called the
"Facility"), as set forth in that certain First Amended Revolving Credit and
Term Loan Agreement dated as of February 20, 1996, as modified by that certain
First Modification of First Amended Revolving Credit and Term Loan Agreement and
of Related Documents dated as of May 19, 1996 (collectively the "BBOT Loan
Agreement").
D. BBOT has heretofore transferred undivided participation interests in the
Facility (the "Participations") to SouthTrust Bank of Georgia, N.A., First
Tennessee Bank National Association, and First National Bank of Commerce, New
Orleans (collectively the "Participating Lenders"), pursuant to the terms of
that certain First Amended Participation Agreement dated as of May 29, 1996 (the
"Participation Agreement").
E. By Amended and Restated Revolving Credit and Term Loan Agreement dated as
of July 30, 1997 (the "Restated Loan Agreement"), the Borrower became the
borrower and assumed the obligations of the Guarantor, formerly as the borrower,
relating to the Facility set forth in the BBOT Loan Agreement, the
Participations were converted into a single direct multiple-lender line of
credit, and the Facility was increased to the maximum aggregate principal amount
of $175,000,000.
F. In connection with the Restated Loan Agreement, BBOT assigned all of its
right, title and interest in and to the Facility, the BBOT Loan Agreement, the
Participation Agreement and the other Loan Documents (as herein defined) to
NationsBank which then, together with the Participating Lenders, terminated the
Participation Agreement and assigned to the Participating Lenders an undivided
interest in and to the Facility. NationsBank also placed of record in each
jurisdiction where a Mortgage was already of record an assignment, modification
and assumption agreement, assigning its rights therein to the Agent as agent for
the Lenders, modifying such
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Mortgage to reflect the increase in the Facility and extension of the Facility
Termination Date, and reflecting the assumption of the Obligations by the
Borrower, and including certain other matters.
G. Contemporaneously with the termination of the Participation Agreement,
NationsBank and the Participating Lenders assigned to the remaining Lenders such
portions of the Commitment existing under the BBOT Loan Agreement as were
necessary to properly distribute to all Lenders their proper pro rata shares of
the Commitment existing under the BBOT Loan Agreement, followed
contemporaneously by an increase in the Facility and Commitment as set forth in
the Restated Loan Agreement and the appointment of NationsBank as the Agent for
the Lenders pursuant to the terms thereof. NationsBanc Capital Markets, Inc.
("NCMI"), now known as NationsBanc ▇▇▇▇▇▇▇▇▇▇ Securities, Inc. ("NMSI"),
arranged the increase in the Facility requested by the Borrower and the
Guarantor from $75,000,000 to $175,000,000, and NCMI and NationsBank coordinated
the closing of such increase.
H. The Borrower has asked that the Restated Loan Agreement be modified to
adjust the interest rate options therein, to add certain additional financial
covenants and delete or modify certain existing financial covenants, and to
include such other modifications as the Agent may deem necessary.
NOW, THEREFORE, in consideration of the mutual covenants and agreements herein
contained, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
As used in this Agreement:
"Adjusted Cash Flow" means the lesser of (i) lease payments for the
trailing twelve (12) months less real estate taxes for the latest available
year, property insurance and the Capital Expenditure Reserve Amount or (ii)
Property Operating Income (as defined herein, but before deducting real estate
taxes, insurance, any capital expenditures and any management fee) for the
trailing twelve (12) months less real estate taxes for the latest available
year, property insurance, the Capital Expenditure Reserve Amount and a
management fee equal to four percent (4%) of trailing twelve (12) month gross
room revenues.
"Adjusted EBITDA" means EBITDA less the Capital Expenditure Reserve
Amount. Wherever in this Agreement such term is used (except in Section
7.18(c)), it is understood that for any Completed Development Hotel or any Hotel
Property owned by the Borrower for less than twelve (12) months, historical
EBITDA for the period of the Borrower's ownership will be used to calculate
Adjusted EBITDA, unless the Borrower requests in writing at least fifteen (15)
Business Days prior to the date such calculation is to be made that the Borrower
prefers to use projected EBITDA for such Hotel Property. Approval of such a
request will be at the Agent's sole discretion.
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"Advance" means a borrowing hereunder consisting of the aggregate
amount of the several Loans made by the Lenders to the Borrower or a Qualified
Borrower of the same Type and, in the case of LIBOR Advances, for the same
Interest Period, including Reimbursement Obligations.
"Affiliate" of any Person means any other Person directly or indirectly
controlling, controlled by or under common control with such Person. A Person
shall be deemed to control another Person if the controlling Person owns 10% or
more of any class of voting securities (or other ownership interests) of the
controlled Person or possesses, directly or indirectly, the power to direct or
cause the direction of the management or policies of the controlled Person,
whether through ownership of stock, by contract or otherwise.
"Agent" means NationsBank, N.A. in its capacity as agent for the
Lenders pursuant to Article XI, and not in its individual capacity as a Lender,
and any successor Agent appointed pursuant to Article XI.
"Agent's Fee" is defined in Section 2.6.
"Aggregate Commitment", or "Aggregate Commitment Amount" means the
aggregate of the Commitments of all the Lenders, which initially shall be
$175,000,000, subject to the Borrower's right to reduce the Aggregate Commitment
pursuant to Section 2.20 and which shall otherwise only be increased with the
consent of all Lenders.
"Agreement" means this Second Amended and Restated Revolving Credit and
Term Loan Agreement, as it may be amended or modified and in effect from time to
time.
"Allocated Facility Amount" means, at any time, the sum of all then
outstanding Advances and the then existing Facility Letter of Credit
Obligations.
"Applicable Advance Rate" means the applicable percentage (as it may
change from time to time upon the agreement of the Borrower and the Lenders) of
either Cost or Implied Value used to calculate the Borrowing Base which for
Hotel Properties in the Secured Collateral Pool is 45%, and for Hotel Properties
in the Negative Collateral Pool is 40%.
"Applicable Cap Rate" means 11% initially, and shall be reviewed
annually on July 30, 1998 and July 30, 1999 and subject to adjustment by the
Required Lenders in their sole discretion based upon market conditions for
comparable property types. In no event shall the Applicable Cap Rate be adjusted
by more than 125 basis points annually.
"Applicable Laws" is defined in Section 6.24(c).
"Arranger" means NMSI.
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"Article" means an article of this Agreement unless another document is
specifically referenced.
"Assignment" is defined in Section 13.3.
"Assignments of Rents and Leases" means the assigning of all rents,
leases, issues and profits from Hotel Properties in the Secured Collateral Pool
as part of the Collateral for the Obligations including, without limitation, the
Leases.
"Authorized Officer" means with respect to any Person, any of the
president, executive vice president, chief operating officer, chief financial
officer or treasurer, general partner, or chief manager acting singly on behalf
of such Person, who has been duly authorized to execute any document and to act
on behalf of such Person.
"BBOT" means Boatmen's Bank of Tennessee.
"BBOT Loan Agreement" means that certain First Amended Revolving Credit
and Term Loan Agreement dated as of February 20, 1996, as modified by that
certain First Modification of First Amended Revolving Credit and Term Loan
Agreement and of Related Documents dated as of May 19, 1996, all entered into by
and between BBOT, the Borrower, and the Guarantor.
"BBOT Note" means that certain Replacement Master Revolving Line of
Credit Promissory Note dated May 29, 1996 in the principal amount of $75,000,000
evidencing the Facility prior to the date hereof, and which BBOT Note was
replaced by the Notes, as hereinafter defined.
"Borrower" means RFS Partnership, L.P., and its successors and
permitted assigns.
"Borrowing Base" means the amount of the Aggregate Commitment available
to the Borrower hereunder, which amount is the sum of (a) for each Collateral
Pool Property owned or open for less than four (4) fiscal quarters, the
Applicable Advance Rate times the Cost, plus (b) for each Collateral Pool
Property owned or open for four (4) fiscal quarters or more, the Applicable
Advance Rate times the Implied Value of the Collateral Pool Property. However,
the aggregate Borrowing Base attributable to Completed Development Hotels in the
Secured Collateral Pool cannot exceed 20% of the aggregate Borrowing Base
attributable to all Secured Collateral Pool Properties at any time prior to July
30, 1998 and 15% at any time thereafter. Further, the aggregate Borrowing Base
attributable to Completed Development Hotels in the Negative Collateral Pool
cannot exceed 20% of the aggregate Borrowing Base attributable to all Negative
Collateral Pool properties at any time prior to July 30, 1998 and 15% at any
time thereafter.
"Borrowing Base to Value Ratio" means the ratio arrived at from time to
time by dividing the Borrowing Base by the then existing Value of the Secured
Collateral Pool.
"Borrowing Date" means a date on which an Advance is made hereunder.
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"Borrowing Notice" is defined in Section 2.9.
"Break-up Fee" means a sum equal to the aggregate of any loss, cost,
liability or expense incurred by the Lenders, or any of them, as a result of the
prepayment of the Obligations, or portion thereof, whether due to acceleration
or in due course in connection with conversions to a LIBOR Loan including,
without limitation, any loss in obtaining, liquidating or employing funds from
third parties, and any loss of yield, as determined by any Lender, on a present
value basis, in its judgment reasonably exercised; but the Break-up Fee shall in
no event be less than zero.
"Business Day" means (i) with respect to any borrowing, payment or rate
selection of LIBOR Advances, a day (other than a Saturday or Sunday) on which
banks generally are open in Atlanta, Georgia for the conduct of substantially
all of their commercial lending activities and on which dealings in United
States dollars are carried on in the London interbank market and (ii) for all
other purposes, a day (other than a Saturday or Sunday) on which banks generally
are open in Atlanta, Georgia for the conduct of substantially all of their
commercial lending activities.
"Capital Expenditure Reserve Amount" means, for any period, 4% of the
trailing twelve (12) month gross revenues.
"Capital Stock" means any and all shares, interests, participations or
other equivalents (however designated) of capital stock of a corporation, any
and all equivalent ownership interests in a Person which is not a corporation
and any and all warrants or options to purchase any of the foregoing.
"Capitalized Lease" of a Person means any lease of Property imposing
obligations on such Person, as lessee thereunder, which are required in
accordance with GAAP to be capitalized on a balance sheet of such Person.
"Capitalized Lease Obligations" of a Person means the amount of the
obligations of such Person under Capitalized Leases which would be shown as a
liability on a balance sheet of such Person prepared in accordance with GAAP.
"Cash Equivalents" means, as of any date, (i) securities issued or
directly and fully guaranteed or insured by the United States Government or any
agency or instrumentality thereof having maturities of not more than one year
from such date, (ii) time deposits and certificates of deposit having maturities
of not more than one year from such date and issued by any domestic commercial
bank having (A) senior long-term unsecured debt rated at least A or the
equivalent thereof by S&P or A2 or the equivalent thereof by ▇▇▇▇▇'▇ and (B)
capital and surplus in excess of $100,000,000, (iii) commercial paper rated at
least A-1 or the equivalent thereof by S&P or P-1 or the equivalent thereof by
▇▇▇▇▇'▇ and in either case maturing within 120 days from such date; and (iv)
shares of any money market mutual fund rated at least AAA or the equivalent
thereof by S&P or at least AAA or the equivalent thereof by ▇▇▇▇▇'▇.
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"Change" is defined in Section 4.2.
"Closing Date" means October 1, 1997.
"Code" means the Internal Revenue Code of 1986, as amended, reformed or
otherwise modified from time to time.
"Collateral" means all property of every type and kind which now or
hereafter secures the Obligations, including, without limitation, the Hotel
Properties in the Secured and Negative Collateral Pools, the Leases and the
Consolidated Lease (including all rents, leases, issues and profits resulting
therefrom or relating thereto), the Letter of Credit Collateral Account, and all
real and personal property described in the Security Documents.
"Collateral Pool" means all Hotel Properties included in the Secured
Collateral Pool and the Negative Collateral Pool.
"Collateral Pool Property" means any Hotel Property in the Collateral
Pool.
"Commitment" means the commitment to lend the maximum principal amount
available under the Facility and, for each Lender, the obligation of such Lender
to make Loans not exceeding the amount set forth opposite its signature below or
as set forth in any Notice of Assignment relating to any assignment that has
become effective pursuant to Section 13.3.2, as such amount may be modified from
time to time pursuant to the terms hereof.
"Commitment Fee" means a sum equal to .20% of the Aggregate Commitment
which has heretofore been paid, $200,000 upon the signing of the Commitment
Letter with the balance paid upon the execution of the Restated Loan Agreement.
"Commitment Letter" means that certain letter from the Lenders to the
Borrower dated April 14, 1997, setting forth the terms of the Commitment, as the
same may have been amended or modified prior to July 30, 1997.
"Completed Development Hotels" means Hotel Properties open less than
twelve (12) months.
"Condemnation" is defined in Section 8.9.
"Consolidated Lease" means that certain Consolidated Amended Lease
Agreement dated as of February 27, 1996, by and between the Borrower, as lessor,
and RFS, Inc., as lessee, as the same may have been, or may hereafter be,
modified, amended or restated.
"Consolidated Lease Estoppel" means that certain Consolidated Lease
Estoppel, Subordination, Attornment and Non-Disturbance Agreement dated February
26, 1996, entered into by and between the Borrower, the Guarantor, RFS, Inc.,
and BBOT.
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"Consolidated Net Worth" means, as of any date of determination, an
amount equal to (a) Total Assets as of such date minus (b) Total Liabilities as
of such date minus (c) GAAP minority interest as of such date.
"Consolidated Total Indebtedness" means, as of any date of
determination, all Indebtedness of the Borrower, the Guarantor, any Qualified
Borrowers and any of their Subsidiaries, determined on a consolidated basis,
such consolidation to be in accordance with GAAP, after eliminating intercompany
items.
"Controlled Group" means all members of a controlled group of
corporations, partnerships (including joint ventures), limited liability
companies and all trades or businesses (whether or not incorporated) under
common control which, together with the Borrower, the Guarantor, Qualified
Borrowers, or any of their Subsidiaries are treated as a single employer under
Section 414 of the Code.
"Conversion/Continuation Notice" is defined in Section 2.10.
"Cost" means for any Hotel Property the purchase price of such Hotel
Property plus the cost of any capital improvements performed by the Borrower
which the Agent has agreed to accept as part of the Cost of such Hotel Property.
For purposes of the Collateral Pool Properties existing as of July 30, 1997,
"Cost" shall mean the amount set forth beside each Hotel Property listed on
Exhibits G or H attached hereto.
"Debt Service" means, for any trailing twelve (12) month period, (a)
Interest Expense for such period plus (b) the aggregate amount of regularly
scheduled principal payments of Indebtedness (excluding the subject balloon
payment and the balloon payment on the Perimeter Note) required to be made
during such period by the Borrower, the Guarantor, any Qualified Borrower or any
of their Subsidiaries plus (c) a percentage of all such regularly scheduled
principal payments required to be made during such period by any Investment
Affiliate on Indebtedness taken into account in calculating Interest Expense,
equal to the greater of (x) the percentage of the principal amount of such
Indebtedness for which the Borrower, the Guarantor, or any Qualified Borrower,
or any Subsidiary is liable and (y) the percentage ownership interest in such
Investment Affiliate held by the Borrower, the Guarantor and any Subsidiaries,
in the aggregate, without duplication.
"Default" means an event of default described in Article VIII.
"Defaulting Lender" means any Lender which fails or refuses to perform
its obligations under this Agreement within the time period specified for
performance of such obligation, or, if no time frame is specified, if such
failure or refusal continues for a period of 5 Business Days after written
notice from the Agent; provided that if such Lender cures such failure or
refusal, such Lender shall cease to be a Defaulting Lender.
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"EBITDA" means income before extraordinary items (but after the impact
of minority interests and reduced to eliminate any income from Investment
Affiliates), as reported by the Borrower, the Guarantor and their Subsidiaries
on a trailing twelve (12) month consolidated basis in accordance with GAAP, plus
Interest Expense, depreciation, amortization and income tax (if any) expense
plus a percentage of such income (adjusted as described above) of any Investment
Affiliate equal to the allocable economic interest in such Investment Affiliate
held by the Borrower, the Guarantor and any Subsidiaries, in the aggregate
(provided that no item of income or expense shall be included more than once in
such calculation even if it falls within more than one of the foregoing
categories).
"Eligible Assignee" means (a) a Lender; (b) an Affiliate of a Lender;
(c) a financial institution or other entity that is an "accredited investor" (as
defined in Rule 501 under the Securities Act of 1933, as amended) having (i)
total assets of at least $10,000,000,000, (ii) a long-term unsecured debt rating
of at least Baa1 by ▇▇▇▇▇'▇ and BBB+ by Standard & Poor's and (iii) an office in
the United States; or (d) any other Person approved by the Agent.
"Environmental Claim" means any investigative, enforcement, cleanup,
removal, containment, remedial or other private or governmental or regulatory
action at any time threatened, instituted or completed pursuant to any
applicable Environmental Requirement, against the Borrower, the Guarantor, any
Qualified Borrower or any Subsidiary, or against or with respect to any Hotel
Properties or any condition, use or activity on any of the Hotel Properties
(including any such action against the Agent or the Lenders), and any claim at
any time threatened or made by any person against the Borrower, the Guarantor,
any Qualified Borrower or any Subsidiary, or against or with respect to any of
the Hotel Properties or any condition, use or activity on any of the Hotel
Properties (including any such claim against Agent or the Lenders), relating to
damage, contribution, cost recovery, compensation, loss or injury resulting from
or in any way arising in connection with any Hazardous Material or any
Environmental Requirement.
"Environmental Law" means any federal, state or local law, statute,
ordinance, code, rule, regulation, license, authorization, decision, order,
injunction, decree, or rule of common law, and any judicial interpretation of
any of the foregoing, which pertains to health, safety, any Hazardous Material,
or the environment (including but not limited to ground or air or water or noise
pollution or contamination, and underground or above ground tanks) and shall
include without limitation, the Solid Waste Disposal Act, 42 U.S.C. ss. 6901 et
seq.; the Comprehensive Environmental Response, Compensation and Liability Act
of 1980, 42 U.S.C. ss. 9601 et seq. ("CERCLA"), as amended by the Superfund
Amendments and Reauthorization Act of 1986 ("▇▇▇▇"); the Hazardous Materials
Transportation Act, 49 U.S.C. ss. 1801 et seq.; the Federal Water Pollution
Control Act, 33 U.S.C. ss. 1251 et seq.; the Clean Air Act, 42 U.S.C. ss. 7401
et seq.; the Toxic Substances Control Act, 15 U.S.C. ss. 2601 et seq.; the Safe
Drinking Water Act, 42 U.S.C. ss. 300f et seq.; any applicable state air quality
Act; any applicable state underground storage tank act; any applicable Water
Quality Control Act; any applicable Comprehensive Solid Waste Management Act;
any applicable Oil or Hazardous Material Spill or Release Act; any applicable
Hazardous Waste Management Act; any applicable Hazardous Site Response Act, and
any other state or federal environmental statutes, and all rules, regulations,
orders and decrees now or hereafter
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promulgated under any of the foregoing, as any of the foregoing now exist or may
be changed or amended or come into effect in the future.
"Environmental Requirement" means any Environmental Law, agreement or
restriction (including but not limited to any condition or requirement imposed
by any insurance or surety company), as the same now exists or may be changed or
amended or come into effect in the future, which pertains to health, safety, any
Hazardous Material, or the environment, including but not limited to ground or
air or water or noise pollution or contamination, and underground or aboveground
tanks.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time, and any rule or regulation issued thereunder.
"Facility" is defined in Recital C.
"Facility Letter of Credit" means a Letter of Credit issued hereunder.
"Facility Letter of Credit Fee" is defined in Section 3.8 (a).
"Facility Letter of Credit Obligations" means, as at the time of
determination thereof, all liabilities, whether actual or contingent, without
duplication, of the Borrower, the Guarantor or any Qualified Borrower with
respect to Facility Letters of Credit, including the aggregate undrawn
face-amount of the then outstanding Facility Letters of Credit, but not
including Reimbursement Obligations.
"Facility Termination Date" means July 30, 2000, or such earlier date
on which the principal balance of the Facility and all other sums due in
connection with the Facility shall be due as a result of the acceleration of the
Facility.
"Federal Funds Effective Rate" means, for any day, an interest rate per
annum equal to the weighted average of the rates on overnight Federal funds
transactions with members of the Federal Reserve System arranged by Federal
funds brokers on such day, as published for such day (or, if such day is not a
Business Day, for the immediately preceding Business Day) by the Federal Reserve
Bank of New York, or, if such rate is not so published for any day which is a
Business Day, the average of the quotations at approximately 10 a.m. (Atlanta
time) on such day on such transactions received by the Agent from three Federal
funds brokers of recognized standing selected by the Agent in its sole
discretion.
"Funds From Operations" or FFO means, as to any period, an amount equal
to (a) income (loss) from operations of the Borrower, the Guarantor and their
respective Subsidiaries for such period, excluding gain (loss) from debt
restructuring and sale of Hotel Properties, plus (b) depreciation and
amortization of real estate assets, plus (minus) (c) to the extent not included
in clause (a) above, gain (loss) on the sales of outparcels made in the ordinary
course of business, and after adjustments for Investment Affiliates, determined
in each case on a combined basis in
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accordance with GAAP. Adjustments for Investment Affiliates will be calculated
to reflect funds from operations on the same basis.
"GAAP" means generally accepted accounting principles in the United
States of America as in effect from time to time, applied in a manner consistent
with that used in preparing the financial statements referred to in Section 7.
1.
"Governmental Authority" means any nation or government, any state or
other political subdivision thereof and any quasi-governmental agency exercising
executive, legislative, judicial, regulatory or administrative functions of or
pertaining to government.
"Guarantee Obligation " means, as to any Person (the "guaranteeing
person"), any obligation (determined without duplication) of (a) the
guaranteeing person or (b) another Person (including, without limitation, any
bank under any Letter of Credit) to induce the creation of which the
guaranteeing person has issued a reimbursement, counter-indemnity or similar
obligation, in either case guaranteeing or in effect guaranteeing any
Indebtedness, leases, dividends or other obligations (the "primary obligations")
of any other third Person (the "primary obligor") in any manner, whether
directly or indirectly, including, without limitation, any obligation of the
guaranteeing person, whether or not contingent, (i) to purchase any such primary
obligation or any property constituting direct or indirect security therefor,
(ii) to advance or supply funds (1) for the purchase or payment of any such
primary obligation or (2), to maintain working capital or equity capital of the
primary obligor or otherwise to maintain the net worth or solvency of the
primary obligor, (iii) to purchase any property, securities or services
primarily for the purpose of assuring the owner of any such primary obligation
of the ability of the primary obligor to make payment of such primary obligation
or (iv) otherwise to assure or hold harmless the owner of any such primary
obligation against loss in respect thereof; provided, however, that the term
Guarantee Obligation shall not include endorsements of instruments for deposit
or collection in the ordinary course of business. The amount of any Guarantee
Obligation of any guaranteeing person shall be deemed to be the maximum stated
amount of the primary obligation relating to such Guarantee Obligation (or, if
less, the maximum stated liability set forth in the instrument embodying such
Guarantee Obligation), provided, that in the absence of any such stated amount
or stated liability, the amount of such Guarantee Obligation shall be such
guaranteeing person's maximum reasonably anticipated liability in respect
thereof as determined by the Borrower, the Guarantor or any Subsidiary in good
faith.
"Guarantor" means RFS Hotel Investors, Inc.
"Hazardous Material" means any substance, whether solid, liquid or
gaseous, which is listed, defined or regulated as a "hazardous substance",
"hazardous waste" or "solid waste", or otherwise classified as hazardous or
toxic, in or pursuant to any Environmental Requirement; or which is or contains
asbestos, radon, any polychlorinated biphenyl, urea formaldehyde foam
insulation, explosive or radioactive material, or motor fuel or other petroleum
hydrocarbons; or which causes or poses a threat to cause a contamination or
nuisance on any real property or any adjacent real property or a hazard to the
environment or to the health or safety of persons on any real property.
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"Hotel Property" or "Hotel Properties" means any parcel of real
property owned by the Borrower, the Guarantor, or any Subsidiary, Investment
Affiliate, Qualified Borrower or Joint Venture, on which parcel is either
located a hotel, or on which construction of a hotel has commenced.
"Implied Debt Service" means twelve (12) times the monthly payment
required to fully amortize the Allocated Facility Amount using (a) a fixed rate
of interest equal to an amount which is 2.25% per annum above the most recent
monthly average of the daily yields on all outstanding United States Treasury
Securities adjusted to a constant maturity of seven (7) years, as most recently
published by the Federal Reserve Board in Federal Reserve Statistical Release
Document H.15(519), Selected Interest Rates, and such rate then rounded upwards
to the nearest .125%, and (b) a twenty (20) year amortization schedule.
"Implied Value" means for any Hotel Property an amount arrived at based
upon that Hotel Property's Adjusted Cash Flow, divided by the Applicable Cap
Rate.
"Indebtedness" of any Person at any date means without duplication, (a)
all indebtedness of such Person for borrowed money which is outstanding
according to GAAP, (b) all obligations of such Person for the deferred purchase
price of property or services, (c) any other indebtedness of such Person which
is evidenced by a note, bond, debenture or similar instrument, (d) all
Capitalized Lease Obligations, (e) all obligations of such Person in respect of
acceptances issued or created for the account of such Person, (f) all Guarantee
Obligations of such Person (excluding in any calculation of consolidated
indebtedness of the Borrower and the Guarantor, Guarantee Obligations of the
Borrower or the Guarantor in respect of primary obligations of any Qualified
Borrower or any Subsidiary), (g) all reimbursement obligations of such Person
for Letters of Credit and other contingent liabilities, (h) all liabilities
secured by any Lien (other than Liens for taxes not yet due and payable) on any
property owned by such Person even though such Person has not assumed or
otherwise become liable for the payment thereof, (i) any repurchase obligation
or liability of such Person or any of its Subsidiaries with respect to accounts
or notes receivable sold by such Person or any of its Subsidiaries, (j) if such
Person is the Borrower or the Guarantor, such Person's pro rata share of debt in
Investment Affiliates and any loans where such Person is liable as a general
partner, (k) the greater of (i) the Borrower's, the Guarantor's and all
Subsidiaries' recourse interest in an Investment Affiliate's debt, or (ii) pro
rata interest in all debt owed by an Investment Affiliate which is either
recourse or non-recourse to the Borrower, or the Guarantor, or any Subsidiary,
as applicable, (l) any pre-sale obligations of such Person relating to the
purchase of any real or personal property and (m) Total Liabilities.
"Interest Expense" means all interest expense of the Borrower, the
Guarantor and any Qualified Borrower and their Subsidiaries determined in
accordance with GAAP plus (i) capitalized interest not covered by an interest
reserve from a loan facility, plus (ii) the allocable portion (based on
liability) of any accrued or paid interest incurred on any obligation for which
the Borrower, the Guarantor , any Qualified Borrower or any Subsidiary is wholly
or partially liable under repayment, interest carry, or performance guarantees,
or other relevant liabilities, plus (iii) the greater of (x) allocable
percentage of any accrued or paid interest incurred on any Indebtedness
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of any Investment Affiliate, whether recourse or non-recourse, equal to the
applicable economic interest in such Investment Affiliate held by the Borrower,
the Guarantor and any Subsidiaries, in the aggregate, or (y) the amount of all
interest expense on all recourse Indebtedness the Borrower, the Guarantor, any
Qualified Borrower, and/or their Subsidiaries, have in any Investment Affiliate,
provided that no expense shall be included more than once in such calculation
even if it falls within more than one of the foregoing categories.
"Investment" of a Person means any loan, advance (other than
commission, travel and similar advances to officers and employees made in the
ordinary course of business and other than advances to, or deposits with,
contractors and suppliers in the ordinary course of business), extension of
credit (other than accounts receivable arising in the ordinary course of
business on terms customary in the trade), deposit account or contribution of
capital by such Person to any other Person or any investment in, or purchase or
other acquisition of, the stock, partnership interests, notes, debentures or
other securities of any other Person made by such Person.
"Investment Affiliate" means any Person in which the Borrower, the
Guarantor or any Qualified Borrower, or any Subsidiary, directly or indirectly,
have an ownership interest, including, without limitation, Joint Ventures, whose
financial results are not consolidated under GAAP with their financial results
on their consolidated financial statements.
"Issuance Date" as defined in Section 3.4(a)(2).
"Issuance Notice" as defined in Section 3.4(c).
"Issuing Bank" means, with respect to each Facility Letter of Credit,
any Lender which issues such Facility Letter of Credit. The initial Issuing Bank
shall be NationsBank.
"Joint Venture" means any joint venture partnership in which the
Borrower, the Guarantor, any Qualified Borrower or any Subsidiary is a joint
venture partner.
"Lease or Leases" means any lease or all leases of any or all of the
Collateral Pool Properties, with the Borrower as the lessor and with either RFS,
Inc., as the lessee (including, without limitation, the Consolidated Lease), or
with any other Person as the lessee approved by the Required Lenders.
"Lenders" means the lending institutions listed on the signature pages
of this Agreement, their respective permitted successors and assigns and any
other lending institutions that subsequently become parties to this Agreement.
"Lending Installation" means, with respect to a Lender, any office,
branch, subsidiary or affiliate of such Lender.
"Lessee" means RFS, Inc., a Tennessee corporation, or any other Person
approved by the Required Lenders, now or hereafter party to any of the Leases as
the tenant or lessee thereunder.
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"Letter of Credit" means a letter of credit of a Person which is issued
upon the application of such Person or upon which such Person is an account
party or for which such Person is in any way liable.
"Letter of Credit Collateral Account" is defined in Section 3.9.
"Letter of Credit Request" is defined in Section 3.4(a).
"Leverage Ratio" means the ratio of Total Liabilities divided by the
Total Asset Value.
"LIBOR Advance" means an Advance which bears interest at a LIBOR Basis.
"LIBOR Basis" means a per annum rate of interest (rounded upwards, if
necessary, to the nearest whole one-sixteenth of 1%) determined pursuant to the
following formula:
LIBOR Rate
-------------------------------
LIBOR Basis = 100% - LIBOR Reserve Percentage
PLUS the number of basis points set forth beside the Leverage Ratio applicable
at any given time (as determined by Agent based upon the most recent compliance
certificate delivered to Agent in accordance with Section 7.1(e) hereof or
otherwise and effective as of the date of receipt of such certificate if such
certificate is accepted by Agent) in the following grid after adjustment for
insurance costs and other appropriate regulatory costs and adjustments (other
than reserve requirements):
LEVERAGE RATIO BASIS POINTS
<25% 135
>=25% and <35% 145
>=35% and <40% 157.5
>=40% 170
"LIBOR Interest Period" means, with respect to any LIBOR Advance, a
period from the date on which the LIBOR Basis shall become effective as to such
LIBOR Advance to thirty (30), sixty (60), ninety (90), or one hundred eighty
(180) days thereafter, subject however to the following:
(i) if any LIBOR Interest Period would otherwise end on a day which is
not a Business Day, that LIBOR Interest Period shall be extended to the next
succeeding Business Day unless the result of such extension would be to extend
such LIBOR Interest Period into another calendar month, in which event such
LIBOR Interest Period shall end on the immediately preceding Business Day; and
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(ii) any LIBOR Interest Period which begins on the last Business Day
of a calendar month (or on a day for which there is no corresponding day in the
calendar month at the end of such LIBOR Interest Period) shall, subject to
clause (iii) below, end on the last Business Day of a calendar month; and
(iii) No LIBOR Interest Period shall extend beyond the Facility
Termination Date.
"LIBOR Loan" means a Loan which bears interest at a LIBOR Basis.
"LIBOR Rate" means for any LIBOR Advance for any LIBOR Interest Period
therefor, the rate per annum appearing on Telerate Page 3750 (or any successor
page) as the London interbank offered rate for deposits in Dollars at
approximately 11:00 a.m. (London time) two (2) Business Days prior to the first
day of such LIBOR Interest Period for a term comparable to such LIBOR Interest
Period. If for any reason such rate is not available, the term "LIBOR Rate"
shall mean, for any LIBOR Advance for any LIBOR Interest Period therefor, the
rate per annum appearing on Reuters Screen LIBO Page as the London interbank
offered rate for deposits in Dollars at approximately 11:00 a.m. (London time)
two (2) Business Days prior to the first day of such LIBOR Interest Period for a
term comparable to such LIBOR Interest Period; provided, however, if more than
one rate is specified on Reuters Screen LIBO Page, the applicable rate shall be
the arithmetic mean of all such rates.
"LIBOR Reserve Percentage" means for any day, that percentage
(expressed as a decimal) which is in effect from time to time under Regulation D
of the Board of Governors of the Federal Reserve System (or any successor), as
such regulation may be amended from time to time or any successor regulation, as
the maximum reserve requirement (including, without limitation, any basic,
supplemental, emergency, special, or marginal reserves) applicable with respect
to Eurocurrency liabilities as that term is defined in Regulation D (or against
any other category of liabilities that includes deposits by reference to which
the interest rate of LIBOR Advances is determined), whether or not any Lender
has any Eurocurrency liabilities subject to such reserve requirement at that
time. LIBOR Advances shall be deemed to constitute Eurocurrency liabilities and
as such shall be deemed subject to reserve requirements without benefits of
credits for proration, exceptions or offsets that may be available from time to
time to any Lender. The LIBOR Basis shall be adjusted automatically on and as of
the effective date of any change in the LIBOR Reserve Percentage.
"Lien" means any lien (statutory or other), mortgage, pledge,
hypothecation, assignment, deposit arrangement, encumbrance or preference,
priority or other security agreement or preferential arrangement of any kind or
nature whatsoever (including, without limitation, the interest of a vendor or
lessor under any conditional sale, Capitalized Lease or other title retention
agreement but excluding the leasehold interest of a lessee in a lease that is
not a Capitalized Lease).
"Loan" means, with respect to a Lender, such Lender's portion of any
Advance.
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"Loan Documents" means this Agreement, the Notes, the Mortgages, the
Negative Pledge Agreements and any guaranty, environmental indemnity agreement,
or other document executed and delivered by the Borrower, the Guarantor, any
Qualified Borrower, any Investment Affiliate, or any of their Subsidiaries, from
time to time and evidencing, securing, guaranteeing or relating to the payment
or performance of the Obligations, as any of the foregoing may be amended or
modified from time to time.
"Market Equity Capitalization" means the sum of the following: (i) the
market value of issued and outstanding common stock of the Guarantor based on
the average closing price over the last twenty (20) trading days (the
Guarantor's closing price being the price listed in the Wall Street Journal,
Final Edition, for all purposes in this Agreement), plus (ii) the market value
of issued and outstanding preferred stock of the Guarantor based on the average
closing price over the last twenty (20) days, plus (iii) the value of the
limited partnership units of the Borrower determined as if each such unit were
converted to a share of common stock of the Guarantor.
"Material Adverse Effect" means a material adverse effect on (i) the
business, Hotel Property, results of operations or financial condition of the
Borrower, the Guarantor, any Qualified Borrower or any of their Subsidiaries
taken as a whole or (ii) the ability of the Borrower or the Guarantor to perform
their obligations under the Loan Documents, or (iii) the validity or
enforceability of any of the Loan Documents or the remedies or material rights
of the Agent or the Lenders thereunder.
"Maximum Amount" means the maximum nonusurious aggregate amount of all
interest permitted by such state or states whose laws are held by any court of
competent jurisdiction to govern the interest rate provisions of the Facility or
the federal laws of the United States applicable to the transaction, whichever
laws allow the greater interest, as such laws now exist or may hereafter be
changed or amended or come into effect in the future.
"Maximum Rate" means the maximum nonusurious rate of interest per annum
permitted by such state or states whose laws are held by any court of competent
jurisdiction to govern the interest rate provisions of the Facility, or the
federal laws of the United States applicable to the transaction, whichever laws
allow the greater interest, as such laws now exist or may hereafter be changed
or amended or come into effect in the future. The Maximum Rate shall be applied
by taking into account all amounts characterized by applicable law as interest
on the Obligations, so that the aggregate of all interest does not exceed the
Maximum Amount.
"Mortgage" means any deed of trust, deed to secure debt or mortgage
encumbering a Hotel Property which secures the Obligations.
"Multiemployer Plan" means a Plan to which more than one employer is
obligated to make contributions, and which is maintained pursuant to one or more
collective bargaining agreements to which the Borrower or any member of the
Controlled Group is a party.
"NMSI" means NationsBanc ▇▇▇▇▇▇▇▇▇▇ Securities, Inc.
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"NationsBank" means NationsBank, N.A., in its individual capacity, and
its successors.
"NationsBank Prime Rate" means, on any day, the rate of interest per
annum then most recently established by NationsBank as its "prime rate". Any
such rate is a general reference rate of interest, may not be related to any
other rate, and may not be the lowest or best rate actually charged by
NationsBank to any customer or a favored rate, and may not correspond with
future increases or decreases in interest rates charged by other lenders or
market rates in general.
"Negative Collateral Pool" means a specified group of Hotel Properties
not encumbered by Mortgages encumbering Hotel Properties that have been accepted
by the Lenders into the Collateral Pool but which the Borrower or other Person
owning any such Hotel Property has agreed not to encumber, transfer, pledge,
assign, mortgage or otherwise hypothecate in any manner.
"Negative Pledge Agreement" means a written agreement executed by the
Borrower or any other Person which owns a Hotel Property wherein the Borrower or
such Person agrees not to encumber, transfer, pledge, assign, mortgage or
otherwise hypothecate such Hotel Property in any manner.
"Non-Conforming Investments" is defined in Section 7.4.
"Note" or "Notes" means the promissory note or notes, in substantially
the form of Exhibit A attached to the Restated Loan Agreement, duly executed by
the Borrower as of July 30, 1997 and payable to the order of each Lender in the
amount of its Commitment, including any amendment, modification, renewal or
replacement of such promissory note(s).
"Notice of Assignment" is defined in Section 13.3.2.
"Obligations" means all indebtedness and obligations of the Borrower
arising under or relating to, this Agreement, the Notes, the Mortgages, as well
as under all other Loan Documents including, without limitation, all unpaid
principal of and accrued and unpaid interest on the Notes, the Facility Letter
of Credit Obligations and all accrued and unpaid fees and all expenses,
reimbursements, indemnities and other obligations (including, without
limitation, Reimbursement Obligations) of the Borrower or if and to the extent
applicable, any Qualified Borrower to the Lenders or to any Lender, the Agent,
or any indemnified party hereunder arising under the Loan Documents.
"Participating Lenders" means all financial institutions named in the
Participation Agreement to whom BBOT transferred an undivided participation in
the Facility.
"Participations" means the interests of the Participating Lenders in
the Facility.
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"Participation Agreement" means that certain First Amended
Participation Agreement dated as of May 29, 1996, entered into by and between
BBOT and the other Participating Lenders.
"Participants" is defined in Section 13.2.1.
"Payment Date" means, with respect to the payment of interest accrued
on any Prime Advance or any LIBOR Advance, the first Business Day of each
calendar month.
"PBGC" means the Pension Benefit Guaranty Corporation, or any successor
thereto.
"Percentage" means for each Lender the percentage of the Aggregate
Commitment allocated to such Lender as set forth opposite its signature.
"Perimeter Note" means that certain promissory note dated December 15,
1989, in the original principal amount of $6,000,000 secured by a Mortgage
encumbering a Hotel Property in ▇▇▇▇▇▇ County, Georgia.
"Permitted Liens" are defined in Section 7.14.
"Person" means any natural person, corporation, firm, joint venture,
partnership, association, enterprise, trust, limited liability company or other
entity or organization, or any government or political subdivision or any
agency, department or instrumentality thereof.
"Plan" means an employee pension benefit plan which is covered by Title
IV of ERISA or subject to the minimum funding standards under Section 412 of the
Code as to which the Borrower or any member of the Controlled Group may have any
liability.
"Prime Advance" means an Advance which bears interest at the Prime
Rate.
"Prime Loan" means a Loan which bears interest at the Prime Rate.
"Prime Rate" means, for any day, a rate per annum equal to the greater
of (i) the NationsBank Prime Rate for such day plus the number of basis points
set forth beside the Leverage Ratio applicable at any given time (as determined
by Agent based upon the most recent compliance certificate delivered to Agent in
accordance with Section 7.1(e) hereof or otherwise and effective as of the date
of receipt of such certificate if such certificate is accepted by Agent) in the
grid set forth below, in each case changing when and as the NationsBank Prime
Rate changes, or (ii) the Federal Funds Effective Rate for such day plus 50
basis points, in each case changing when and as the Federal Funds Effective Rate
changes:
LEVERAGE RATIO BASIS POINTS
<25% 0
>=25% and <35% 0
>=35% and <40% 25
>=40% 50
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"Property Breach" is defined in Section 7.24.
"Property Operating Income" means, with respect to any Hotel Property
owned by the Borrower, the Guarantor, any Qualified Borrower, any Subsidiary or
any Investment Affiliate, for any period, earnings from rental operations
(computed in accordance with GAAP but without deduction for reserves)
attributable to such Hotel Property plus depreciation, amortization and interest
expense for such period, and, if such period is less than a year, adjusted by
straight lining various ordinary operating expenses which are payable less
frequently than once during every such period (e.g. real estate taxes and
insurance).
"Purchaser" is defined in Section 13.3.l.
"Qualified Borrower" means any entity, other than the Borrower, in
which the Borrower or the Guarantor owns an interest, the Indebtedness of which
entity is guaranteed by the Borrower or the Guarantor, and with respect to which
the Borrower or the Guarantor has provided to the Agent an unconditional
guaranty of payment satisfactory in form and substance to the Agent, as well as
such notes, opinions, financial statements, organizational and authorization
documents, security or collateral documents and other documents as the Agent may
require in order for such entity to be able to receive an Advance under the
Facility.
"Qualified Lender" means a financial institution with assets over
$5,000,000,000 that is generally in the business of making loans comparable to
the Loans made under the Facility and that maintains an office in the United
States.
"Register" is defined in Section 13.6.
"Regulation U" means Regulation U of the Board of Governors of the
Federal Reserve System as from time to time in effect and any successor or other
regulation or official interpretation of said Board of Governors relating to the
extension of credit by banks for the purpose of purchasing or carrying margin
stocks applicable to member banks of the Federal Reserve System.
"Reimbursement Obligations" means at any time, the aggregate of the
Obligations of the Borrower and any Qualified Borrowers to the Lenders, the
Issuing Bank and the Agent in respect of all unreimbursed payments or
disbursements made by the Lenders, the Issuing Bank and the Agent under or in
respect of the Facility Letters of Credit.
"Reportable Event" means a reportable event as defined in Section 4043
of ERISA and the regulations issued under such section, with respect to a Plan,
excluding, however, such events as to which the PBGC by regulation waived the
requirement of Section 4043(a) of ERISA that it be notified within 30 days of
the occurrence of such event, provided, however, that a failure to meet
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the minimum funding standard of Section 412 of the Code and of Section 302 of
ERISA shall be a Reportable Event regardless of the issuance of any such waiver
of the notice requirement in accordance with either Section 4043(a) of ERISA or
Section 412(d) of the Code.
"Required Lenders" means Lenders in the aggregate having at least 66
2/3% of the Aggregate Commitment (not held by Defaulting Lenders who are not
entitled to vote) or, if the Aggregate Commitment has been terminated, Lenders
in the aggregate holding at least 66 2/3 % of the aggregate unpaid principal
amount of the outstanding Advances and Facility Letter of Credit Obligations
(not held by Defaulting Lenders who are not entitled to vote).
"Restated Loan Agreement" means that certain Amended and Restated
Revolving Credit and Term Loan Agreement dated as of July 30, 1997, entered into
by and among the Borrower, the Guarantor and NationsBank, N.A., as Agent and
Lender, and the several other lenders from time to time parties thereto.
"Secured Collateral Pool" means a specified group of Hotel Properties
encumbered by Mortgages which have been accepted by the Lenders into the
Collateral Pool to secure the Obligations.
"Security Documents" means all Loan Documents executed by or on behalf
of the Borrower, the Guarantor, any Subsidiary, any Qualified Borrower, or any
Investment Affiliate which pledge, mortgage, encumber or constitute a lien upon
any of their real or personal property as part of the Collateral, including,
without limitation the Mortgages and the Assignments of Rents and Leases, any
UCC financing statements, and all supporting documents relating thereto,
including, without limitation, title insurance policies, surveys, appraisals,
and environmental surveys or reports.
"Section" means a numbered section of this Agreement, unless another
document is specifically referenced.
"Senior Loans" is defined in Section 11.15.
"Single Employer Plan" means a Plan maintained by the Borrower or any
member of the Controlled Group for employees of the Borrower or any member of
the Controlled Group.
"Subsidiary" means a corporation, partnership or other entity of which
shares of stock or other ownership interests having ordinary voting power (other
than stock or such other ownership interests having such power only by reason of
the happening of a contingency) to elect a majority of the board of directors or
other managers of such corporation, partnership or other entity are at the time
owned, or the management of which is otherwise controlled, directly or
indirectly through one or more intermediaries, or both, by the Borrower, the
Guarantor, or any Qualified Borrower and provided such corporation, partnership
or other entity is consolidated with the Borrower, the Guarantor, or any such
Qualified Borrower for financial reporting purposes under GAAP.
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"Total Assets" means all GAAP assets of the Borrower, the Guarantor,
any Qualified Borrowers and any of their Subsidiaries.
"Total Asset Value" means the sum of (a) for each open Hotel Property
owned or open for less than four (4) fiscal quarters, whether or not such Hotel
Property is included in the Collateral Pool, 100% of the Cost of the Hotel
Property plus (b) for each open Hotel Property owned or open for four (4) fiscal
quarters or more, whether or not such Hotel Property is included in the
Collateral Pool, the Implied Value of the Hotel Property, plus (c) 100% of cash
and Cash Equivalents in accordance with GAAP.
"Total Liabilities" means all GAAP liabilities (not inclusive of GAAP
minority interest) of the Borrower, the Guarantor, any Qualified Borrowers and
any of their Subsidiaries.
"Total Property Operating Income" means the sum of (i) Property
Operating Income for each Hotel Property owned (including leaseholds) by the
Borrower and its Subsidiaries and any Qualified Borrower, and (ii) (without
redundancy) the Borrower's pro rata share (based on percentage interest in
operating income) of Property Operating Income from any Hotel Property owned
(including leaseholds) by the Guarantor, and any Qualified Borrowers or
Investment Affiliates.
"Transferee" is defined in Section 13.4.
"Type" means, with respect to any Advance, its nature as a Prime
Advance or a LIBOR Advance.
"Unfunded Liabilities" means the amount (if any) by which the present
value of all vested nonforfeitable benefits under all Single Employer Plans
determined under Section 4001(a)(18)(A) of ERISA exceeds the fair market value
of all such Plan assets allocable to such benefits determined as of the then
most recent valuation date for such Plans.
"Unmatured Default" means an event which but for the lapse of time or
the giving of notice, or both, would constitute a Default.
"Unused Credit Fee" means the fee payable by the Borrower to the Agent
for the benefit of the Lenders as set out in Section 2.5.
"Value" means the Implied Value for Secured Collateral Pool properties
owned or open for more than four (4) fiscal quarters, and means the Cost of
Hotel Properties in the Secured Collateral Pool owned or open for less than four
(4) fiscal quarters. However, the aggregate Value attributable to Completed
Development Hotels in the Secured Collateral Pool cannot exceed 20% of the
aggregate Value attributable to all Hotel Properties in the Secured Collateral
Pool at any time prior to July 30, 1998, and 15% at any time thereafter.
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"Wholly-Owned Subsidiary" of a Person means (i) any Subsidiary all of
the outstanding voting securities of which shall at the time be owned or
controlled, directly or indirectly, by such Person or one or more Wholly-Owned
Subsidiaries of such Person, or (ii) any partnership, association, joint venture
or similar business organization of which 100% of the ownership interests having
ordinary voting power and at least 95% of all other classes of ownership
interest shall at the time be so owned or controlled by such Person.
The foregoing definitions shall be equally applicable to both the
singular and plural forms of the defined terms.
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ARTICLE II
THE CREDIT
2.1 Assignment and Assumption; Conversion; Commitment Increase.
2.1.1. Assignment and Assumption.Pursuant to the Restated Loan
Agreement, as the same is being amended and restated hereby,
the Guarantor has heretofore transferred and assigned to the
Borrower, and the Borrower has heretofore assumed, in the
place and stead of the Guarantor, all indebtedness and
obligations relating to or arising out of the BBOT Note and
the BBOT Loan Agreement and all other documents relating
thereto. The Guarantor has, effective as of July 30, 1997,
executed a guaranty agreement in form and content acceptable
to the Lenders guaranteeing the Obligations.
2.1.2 Conversion. BBOT has, by separate assignment executed July 30,
1997, assigned to NationsBank all its right, title and
interest in and to the Facility, the BBOT Loan Agreement, the
Participation Agreement and the other Loan Documents. Pursuant
to the Restated Loan Agreement, as the same is being amended
and restated hereby, the Participation Agreement was
terminated by NationsBank, as successor-in-interest to BBOT,
and the Participating Lenders, and NationsBank assigned to the
Participating Lenders their respective pro rata portions of
the Commitment existing under the BBOT Loan Agreement. If
deemed necessary by the Agent in connection with the
termination of the Participations, all Lenders other than the
Participating Lenders have heretofore agreed to pay to
NationsBank upon demand their respective pro rata shares of
all outstanding Advances existing on or after the date of
termination of the Participations. It is understood and agreed
that the Participations have heretofore been converted into
direct obligations to lend, and the Participating Lenders have
assumed their respective pro rata portions of the Commitment
to make Advances and their respective pro rata portions of all
other obligations of NationsBank, as successor-in-interest to
BBOT, under or in regards to the Facility as heretofore set
forth in the BBOT Loan Agreement, as the same was amended and
restated by the Restated Loan Agreement, as the same is being
amended and restated hereby, and as such Commitment was
increased as set forth in the Restated Loan Agreement, as the
same is being amended and restated hereby. Likewise,
NationsBank and the Participating Lenders have heretofore
assigned to the remaining Lenders such portions of the
Commitment existing under the BBOT Loan Agreement as necessary
to properly distribute to all Lenders their proper pro rata
shares of the Commitment existing under the BBOT Loan
Agreement in accordance and consistent with their respective
Percentages of the Aggregate Commitment allocated to the
Lenders, as set forth opposite their signatures herein.
NationsBank and, to the extent of any interest they
may have had, the Participating Lenders, have heretofore
assigned to the Agent as the agent for the
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Lenders pursuant to the terms of Article XI of the Restated
Loan Agreement, as the same is being amended and restated
hereby, all of their right, title and interest in and to the
Obligations, the Collateral and the other Loan Documents, and
directed the Agent to place of record in each jurisdiction
where a Mortgage appears of record an appropriate assignment
and modification agreement reflecting the transfer of such
Mortgage and related Loan Documents from NationsBank to the
Agent, as agent for the Lenders.
It is also understood and agreed that the assignments
by NationsBank and the Participating Lenders of an undivided
interest in the Facility were outright and absolute
assignments, and not the sale or transfer of a participation
interest, and were not intended to constitute a refinance of
the Facility.
2.1.3. Commitment Increase; Notes. The Facility has heretofore been
increased from $75,000,000, as set forth in the BBOT Loan
Agreement, to $175,000,000, as set forth in the Restated Loan
Agreement. From and including July 30, 1997 and prior to the
Facility Termination Date, each Lender has heretofore agreed
and committed pursuant to the Restated Loan Agreement, as
amended and restated hereby, subject to the terms and
conditions set forth in this Agreement, to make Loans to the
Borrower from time to time in amounts not to exceed in the
aggregate for each Lender at any one time outstanding the
amount of such Lender's Commitment (as set forth beside each
Lender's name on the signature page hereof) minus such
Lender's Percentage of Facility Letter of Credit Obligations
and Reimbursement Obligations. Subject to the terms of this
Agreement, the Borrower may borrow, repay and reborrow at any
time prior to the Facility Termination Date. The Commitments
of each Lender to lend under the Restated Loan Agreement, as
amended and restated hereby, shall expire on the Facility
Termination Date. In connection with the increased Facility,
the Borrower on July 30, 1997 executed and delivered to each
Lender a Note in the amount of each Lender's Commitment, which
Notes collectively replaced and restated the BBOT Note, and
increased the Aggregate Commitment Amount evidenced thereby.
2.2. Final Principal Payment. Any outstanding Advances and all
other unpaid Obligations shall be paid in full by the Borrower
on the Facility Termination Date.
2.3. Ratable Loans. Each Advance hereunder shall consist of Loans made from
the several Lenders ratably in proportion to the ratio that their respective
Commitments bear to the Aggregate Commitment. The Advances may be Prime
Advances, LIBOR Advances, or a combination thereof, selected by the Borrower in
accordance with Sections 2.9 and 2.10.
2.4. Collateral.
(a) The Collateral shall consist primarily of cross-collateralized and
cross-defaulted first priority Mortgages encumbering Hotel Properties in the
Secured Collateral Pool, and by
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Negative Pledge Agreements restricting the transfer, pledge or other
hypothecation of Hotel Properties in the Negative Collateral Pool, both of which
groups of Hotel Properties form the Collateral Pool or Collateral Pool
Properties, and are listed on Exhibits G and H respectively attached hereto,
with the franchise and franchisor for each such Hotel Property identified
thereon which have been approved by the Lenders. Each Collateral Pool Property
must be domestic, that is, located in the lower forty-eight (48) continental
United States of America, must be subject to a current franchise agreement (with
no defaults thereunder) approved by the Lenders with a franchisor that is
acceptable to the Lenders, must be unencumbered with only such exceptions as
have been approved by the Lenders, must be open for business and fully
operational, and must otherwise be in compliance with the applicable provisions
of Article V hereof. Notwithstanding the foregoing, all Collateral Pool
Properties must be wholly owned by the Borrower and no Hotel Properties owned by
Joint Ventures may be included in the Collateral Pool.
(b) The Mortgages encumbering the Hotel Properties presently in the
Secured Collateral Pool which have heretofore secured the Facility evidenced by
the BBOT Note, pursuant to the terms of the BBOT Loan Agreement, as amended and
restated by the Restated Loan Agreement, which is being amended and restated
hereby, have heretofore been assigned to the Agent as a continuing part of the
Collateral, subject to being reviewed by and acceptable to the Lenders in
accordance with the conditions precedent set forth in Article V, Section 5.1,
hereof. In the event at any time the Lenders determine that any item required by
the applicable provisions of Article V hereof, whether for existing or future
Collateral Pool Properties, is not available, or has not been provided, or is
not acceptable, such item may, in the Lenders' sole discretion, either be
waived, or, in the alternative, such Hotel Property for which the item has not
been provided or is unacceptable may be removed from the Collateral Pool, in
which event the Borrowing Base shall be adjusted accordingly to reflect the
removal of such Hotel Property. Furthermore, for purposes of calculating the
Borrowing Base to Value Ratio, the Collateral Pool Property for which items have
not been provided, or is unacceptable, will be removed from the calculation
thereof. In the alternative, the Borrower may substitute another Hotel Property
for the one so removed, provided such Hotel Property is acceptable to the
Lenders, and all conditions precedent to the inclusion of such Hotel Property in
the Collateral Pool have been complied with, including, without limitation, the
conditions of either Section 5.3 or 5.4, as applicable. Any such Hotel Property
so removed from the Collateral Pool shall upon the written request from the
Borrower be released by the Agent from the lien of any Mortgage, or from the
restrictions of any Negative Pledge Agreement, provided there is then existing
no Default or Unmatured Default then existing hereunder, and provided all
provisions of Section 7.13 hereof have been complied with.
2.5. Unused Credit Fee. Pursuant to the Restated Loan Agreement, as amended and
restated hereby, the Borrower has heretofore agreed and hereby agrees to pay to
the Agent for the account of each Lender the Unused Credit Fee from July 30,
1997 to and including the Facility Termination Date, calculated at the rate of
0.18 % per annum on the actual daily unborrowed portion of such Lender's
Commitment (which is equal to the difference between (a) such Lender's
Commitment on such day and (b) the then outstanding Loans owed to such Lender
plus the Lender's Percentage of any outstanding and undrawn Facility Letters of
Credit) payable quarterly in arrears on the first day of each calendar quarter
beginning October 1, 1997 and on the Facility
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Termination Date; provided, however, that the Unused Credit Fee shall be
calculated at the reduced rate of 0.125 % per annum on the actual daily
unborrowed portion of such Lender's Commitment for any day on which the
principal balance of all outstanding and unpaid Loans held by such Lender plus
its Percentage of outstanding and undrawn Facility Letters of Credit is greater
than 50% of such Lender's Commitment. Notwithstanding the foregoing, all accrued
Unused Credit Fees shall be payable on the effective date of any termination of
the obligations of the Lenders to make Loans hereunder. Notwithstanding the
Aggregate Commitment Amount of $175,000,000, it is understood and agreed that,
until such time as the Borrowing Base equals or exceeds $175,000,000, the Unused
Credit Fee will be calculated using an assumed Aggregate Commitment Amount equal
to the greater of (a) $150,000,000 or (b) the Borrowing Base, as it may change
from time to time during such time period as reflected on quarterly Borrowing
Base certificates submitted by the Borrower, or as determined at other times
during a quarter as provided herein, and that the amount of each Lender's
Commitment will be adjusted accordingly solely for purposes of calculating each
Lender's prorata share of the Unused Credit Fee.
2.6. Commitment Fee; Other Fees.
2.6.1. Commitment Fee. The Borrower has heretofore paid to the Agent
for the account of each Lender the Commitment Fee, $200,000 of
which was paid upon the signing of the Commitment Letter by
the Borrower with the balance paid upon the execution of the
Restated Loan Agreement.
2.6.2. Other Fees. The Borrower agrees to pay all other fees payable
to the Agent and/or the Arranger for their own accounts or for
the account of the Lenders pursuant to the terms hereof and/or
the Borrower's prior letter agreements with either the Agent
or the Arranger, including, without limitation, an annual
Agent fee of $200,000 which was paid initially on July 30,
1997, and shall be paid $150,000 annually hereafter on July
30, 1998, and on July 30, 1999 (the "Agent's Fee").
2.7. Minimum Amount of Each Advance. Each LIBOR Advance shall be in the
minimum amount of $2,000,000 (and in multiples of $100,000 if in excess
thereof), and each Prime Advance shall be in the minimum amount of $1,000,000
(and in multiples of $100,000 if in excess thereof), provided, however, that any
Prime Advance may be in the amount of the unused Aggregate Commitment.
2.8. Optional Principal Payments. The Borrower may from time to time pay,
without penalty or premium (subject to reimbursement, upon demand, of the
Lenders' Break-up Fee and all other breakage and re-deployment costs in the case
of prepayment of LIBOR Advances), all or any part of outstanding Prime Advances
or LIBOR Advances, upon two (2) Business Days' prior notice to the Agent and
each such prepayment shall be in a minimum amount of $50,000.00 or in multiples
thereof, provided that a LIBOR Advance may not be paid prior to the last day of
the applicable LIBOR Interest Period unless Borrower pays the Break-up Fee.
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2.9. Manner of Borrowing and Method of Selecting Types and Interest Periods
for New Advances; Borrowing Base; Lender Obligations.
2.9.1. Manner of Borrowing and Method of Selecting Types and Interest
Periods for New Advances. The Borrower shall select the Type
of Advance and, in the case of each LIBOR Advance, the LIBOR
Interest Period applicable to each Advance from time to time.
The Borrower shall give the Agent irrevocable notice
substantially in the form of Exhibit I-1 attached hereto (a
"Borrowing Notice") (i) not later than 1:00 p.m. (Atlanta
time) at least one, (1) Business Day before the Borrowing Date
of each Prime Advance, and (ii) not later than 1:00 p.m.
(Atlanta time) at least three (3) Business Days before the
Borrowing Date for each LIBOR Advance, specifying:
(a) the Borrowing Date, which shall be a Business Day, of
such Advance,
(b) the aggregate amount of such Advance,
(c) the Type of Advance selected, and
(d) in the case of each LIBOR Advance, the LIBOR Interest
Period applicable thereto.
2.9.2. Borrowing Base. Availability under the Facility shall be
determined according to the Borrowing Base. In no event shall
the Borrower be entitled hereunder to Advances or Facility
Letters of Credit which would cause the Borrowing Base to
Value Ratio to be greater than 75%, nor shall the Allocated
Facility Amount at any time under the Loans exceed the lesser
of (i) the Borrowing Base or (ii) the Aggregate Commitment
Amount. Furthermore, any Collateral Pool Property whose
operating franchise license is canceled shall be immediately
deducted from the Borrowing Base until such time as a
franchise reasonably acceptable to the Lenders is obtained
with respect to such Collateral Pool Property. For purposes of
the computation of the Borrowing Base to Value Ratio, the
Collateral Pool Property with respect to which such franchise
is canceled shall be removed from the calculation. In the
alternative, the Borrower may substitute another Hotel
Property for the one whose franchise license has been
canceled, provided such Hotel Property is acceptable to the
Lenders and all conditions precedent to the inclusion of such
Hotel Property in the Collateral Pool have been complied with,
including without limitation, the conditions of either
Sections 5.3 or 5.4, as applicable. In such event, upon the
substitution of such Hotel Property, upon the written request
from the Borrower, the Hotel Property deducted from the
Borrowing Base calculation shall be released by the Agent from
the lien of any Mortgage, or from the restrictions of any
Negative Pledge Agreement, provided there is no Default or
Unmatured Default then existing hereunder, and provided all
provisions of Section 7.13 hereof have been complied with.
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2.9.3. Lender Obligations. Not later than 12:00 noon (Atlanta time)
(as to each Lender other than ▇▇▇▇▇ Fargo Bank which shall
provide its Federal Reference Number and time not later than
12:30 p.m. [Atlanta time]) on each Borrowing Date, each Lender
shall make available its Loan or Loans, in funds immediately
available in Atlanta, Georgia to the Agent at the account
specified pursuant to Article XIV. The Lenders shall not be
obligated to match fund their LIBOR Advances. The Agent will
promptly make the funds so received from the Lenders available
to the Borrower from the Agent's aforesaid account. No LIBOR
Interest Period may end after the Facility Termination Date
and, unless all of the Lenders otherwise agree in writing, in
no event may there be more than five (5) different LIBOR
Interest Periods for LIBOR Advances outstanding at any one
time.
2.10. Conversion and Continuation of Outstanding Advances. Prime
Advances shall continue as Prime Advances unless and until such Prime Advances
are converted into LIBOR Advances. Each LIBOR Advance shall continue as a LIBOR
Advance until the end of the then applicable LIBOR Interest Period therefor, at
which time such LIBOR Advance shall be automatically converted into a Prime
Advance unless the Borrower shall have given the Agent a Conversion/Continuation
Notice requesting that, at the end of such LIBOR Interest Period, such LIBOR
Advance shall continue as a LIBOR Advance for the same or another LIBOR Interest
Period. The Borrower may elect from time to time to convert all or any part of
an Advance of any Type into any other Type of Advance; provided that any
conversion of any LIBOR Advance (whether due to acceleration or otherwise) shall
be made on, and only on, the last day of the Interest Period applicable thereto
unless the Borrower pays the applicable Break-up Fee, to be paid on the same
Business Day as the conversion occurs. The Borrower shall give the Agent
irrevocable notice substantially in the form of Exhibit I-2 attached hereto (a
"Conversion/Continuation Notice") of each conversion of an Advance not later
than 1:00 p.m. (Atlanta time) at least one Business Day, in the case of a
conversion into a Prime Advance, or three Business Days, in the case of a
conversion into or continuation of a LIBOR Advance, prior to the date of the
requested conversion or continuation, specifying:
(a) the requested date which shall be a Business Day, of such
conversion or continuation;
(b) the aggregate amount and Type of the Advance which is to be
converted or continued; and
(c) the amount and Type(s) of Advance(s) into which such Advance
is to be converted or continued and, in the case of a
conversion into or continuation of a LIBOR Advance, the
duration of the LIBOR Interest Period applicable thereto.
2.11. Changes in Interest Rate, Etc. Each Prime Advance shall bear
interest on the outstanding principal amount thereof, for each day from and
including the date such Advance is made or is converted from a LIBOR Advance
into a Prime Advance pursuant to Section 2.10 to but excluding the date it is
paid or is converted into a LIBOR Advance pursuant to Section 2.10 hereof,
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at a rate per annum equal to the Prime Rate for such day. Changes in the rate of
interest on that portion of any Advance maintained as a Prime Advance will take
effect simultaneously with each change in the NationsBank Prime Rate. Each LIBOR
Advance shall bear interest from and including the first day of the LIBOR
Interest Period applicable thereto to (but not including) the last day of such
LIBOR Interest Period at the LIBOR Basis determined as applicable to such LIBOR
Advance.
If, on or prior to the first day of any LIBOR Interest Period,
(a) the Agent shall have reasonably determined (which
determination shall be conclusive and binding) that by reason
of circumstances affecting the London interbank market or
other Eurodollar market, as applicable, adequate and
reasonable means do not exist for ascertaining the LIBOR
Basis, or
(b) the Agent shall have reasonably determined (which
determination shall be conclusive and binding) that the LIBOR
Basis will not adequately and fairly reflect the cost to the
Lenders of such LIBOR Advance for such LIBOR Interest Period,
then the Agent shall forthwith give notice thereof to the Borrower, whereupon
until the Agent notifies the Borrower that the circumstances giving rise to such
suspension no longer exist, the obligations of the Lenders to allow new LIBOR
Advances shall be suspended.
If, after the date of this Agreement, the adoption of any applicable
law, rule or regulations, or any change therein, or any change in the
interpretation or administration thereof by any governmental authority, central
bank or comparable agency charged with the interpretation or administration
thereof, or compliance by the Agent or the Lenders with any request or directive
(whether or not having the force of law) of any such authority, central bank or
comparable agency shall make it unlawful or impossible for the Lenders to make,
maintain or fund LIBOR Loans, the Agent shall forthwith give notice thereof to
the Borrower, whereupon until the Agent notifies the Borrower that the
circumstances giving rise to such suspension no longer exist, the obligation of
the Lenders to allow LIBOR Advances shall be suspended. If the Agent shall
determine that the Lenders may not lawfully continue to maintain any outstanding
LIBOR Loans to maturity and shall so specify in such notice, such LIBOR Loans
shall be immediately converted to a borrowing at the Prime Rate.
If, after the date of this Agreement, the adoption of any applicable
law, rule or regulation, or any change therein, or any change in the
interpretation or administration thereof by any governmental authority, central
bank or comparable agency charged with the interpretation or administration
thereof, or compliance by the Agent or the Lenders with any request or directive
(whether or not having the force of law) of any such authority, central bank or
comparable agency:
(a) shall subject the Lenders to any tax, duty or other direct
charge with respect to the LIBOR Loans or this Agreement or
shall change the basis of taxation of payments to the Lenders
of the principal of or interest on LIBOR Loans or any other
amounts
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due under this Agreement in respect to LIBOR Loans or the
Lenders' obligations to allow LIBOR Advances (except for
changes in the rate of tax on the overall net income of any
Lender imposed by the jurisdiction in which any Lender's
principal executive office is located); or
(b) shall impose, modify or deem applicable any reserve, special
deposit or similar requirement (including, without limitation,
any such requirement imposed by the Board of Governors of the
Federal Reserve System, but excluding with respect to any
LIBOR Loan any such requirement included in an applicable
LIBOR Reserve Percentage) against assets of, deposits with or
for the account of, or credit extended by, any Lender or shall
impose on any Lender or the interbank market for Eurodollar
deposits and other condition affecting LIBOR Loans, this
Agreement or the obligation of any Lender to allow LIBOR
Advances;
and the result of any of the foregoing is to increase the cost to any Lender of
allowing or maintaining LIBOR Loans or to reduce the amount of any sum received
or receivable by any Lender under this Agreement with respect thereto, by an
amount deemed by the Agent, in its good faith judgment, to be material, then,
within fifteen (15) days after demand by the Agent, the Borrower shall pay to
the Agent for the benefit of the Lenders such additional amount or amounts as
will compensate the Lenders for such increased cost or reduction. The Agent will
promptly notify the Borrower of any event of which it has knowledge, occurring
after the date hereof, which will entitle the Lenders to compensation pursuant
to this paragraph. A certificate of the Agent claiming compensation under this
paragraph, setting forth the additional amount or amounts to be paid to it
hereunder, and explaining in reasonable detail the estimates, data and
calculations of such amount, shall be conclusive and binding in the absence of
manifest error. In determining such amount, the Agent may use any reasonable
averaging and attribution methods. In lieu of paying the compensation to the
Lenders described in this paragraph, the Borrower may elect, promptly upon
receiving notice from the Agent of the event entitling the Lenders to such
compensation, to have any LIBOR Loan converted to a Prime Advance, subject to
the Borrower's payment of any Break-up Fee due as a result of such conversion.
2.12. Rates Applicable After Default; Late Fee. Notwithstanding
anything to the contrary contained in Sections 2.9 or 2.10, during the
continuance of a Default or Unmatured Default, the Agent may, at the option of
the Required Lenders, by written notice to the Borrower (which notice may be
revoked at the option of the Required Lenders notwithstanding any provision of
Section 9.2 requiring unanimous consent of the Lenders to changes in interest
rates), declare that no Advance may be made as, converted into or continued
beyond its current term as a LIBOR Advance. During the continuance of a Default,
the Agent may, at the option of the Required Lenders, by prior written notice to
the Borrower (which notice may be revoked at the option of the Required Lenders
notwithstanding any provision of Section 9.2 requiring unanimous consent of the
Lenders to changes in interest rates), declare that (a) each LIBOR Advance shall
bear interest for the applicable LIBOR Interest Period at a rate per annum equal
to the lesser of (i) the rate otherwise applicable to such LIBOR Interest Period
plus 4% per annum or (ii) the Maximum Rate, until such Default shall have been
cured and (b) each Prime Advance shall bear interest at a rate
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per annum equal to the lesser of (i) the Prime Rate otherwise applicable to the
Prime Advance plus 4% per annum or (ii) the Maximum Rate until such Default
shall have been cured; provided that such rates shall become applicable
automatically without notice to the Borrower if a Default occurs under Section
8.7 or Section 8.8.
If any principal or interest is not paid when due, the Borrower shall
pay, on demand, a late charge of $.04 for each dollar of each installment which
becomes past due for a period exceeding ten (10) days to help defray the added
expense incurred in handling said delinquent installment, provided that in the
event any such late charge should be determined by a court of competent
jurisdiction to constitute interest, in no event shall such interest be due or
payable in excess of the Maximum Rate.
2.13. Method of Payment. All payments of the Obligations hereunder
shall be made, without setoff, deduction, or counterclaim, in immediately
available funds to the Agent at the Agent's account specified pursuant to
Article XIV, or at any other Lending Installation of the Agent specified in
writing by the Agent to the Borrower, by 1:00 p.m. (Atlanta time) on the date
when due and shall be applied ratably by the Agent among the Lenders. Any
payment received after 1:00 p.m. shall be processed as of the next Business Day.
Each payment delivered to the Agent for the account of any Lender shall be
delivered promptly by the Agent to such Lender in the same type of funds that
the Agent received at its account specified pursuant to Article XIV or at any
Lending Installation specified in a notice received by the Agent from such
Lender promptly. If any payment received by the Agent is not delivered to a
Lender by the closing of business on the same Business Day as received by the
Agent (with respect to payments received by 1:00 p.m., Atlanta time) or the next
Business Day (with respect to payments received after 1:00 p.m., Atlanta time),
such Lender shall receive from the Agent interest at the Federal Funds Effective
Rate on the payment. The Agent is hereby authorized to charge the specific
account of the Borrower, if any, maintained with NationsBank for such purpose,
for each payment of principal, interest and fees as it becomes due hereunder.
The Borrower shall not have any liability to any Lender for the failure of the
Agent to promptly deliver funds to any such Lender and shall be deemed to have
made all such payments on the date the respective payment is made by the
Borrower to the Agent provided that it is received by the Agent no later than
the time specified in this Section 2.13.
2.14. Notes; Telephonic Notices. Each Lender is hereby authorized to
record the principal amount of each of its Loans and each repayment on the
schedule attached to its Note, provided, however, that the failure to so record
shall not affect the Borrower's obligations under such Note. Each Lender's books
and records, including without limitation, the information, if any, recorded by
the Lender on the schedule attached to its Note, shall be deemed to be prima
facia correct absent manifest error. The Borrower hereby authorizes the Lenders
and the Agent to extend, convert or continue Advances, effect selections of
Types of Advances and to transfer funds based on telephonic notices made by any
person or persons the Agent or any Lender in good faith believes to be an
Authorized Officer. The Borrower agrees to deliver promptly to the Agent a
written confirmation signed by an Authorized Officer of each telephonic notice.
If the written
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confirmation differs in any material respect from the action taken by the Agent
and the Lenders, the records of the Agent and the Lenders shall govern absent
manifest error.
2.15. Interest Payment Dates; Interest and Fee Basis. Interest accrued
on each Advance shall be payable on each Payment Date, commencing with the first
such date to occur after the date hereof, and at the Facility Termination Date,
whether by acceleration or otherwise. Interest accrued on each LIBOR Advance
shall not be payable on any date on which the LIBOR Advance is prepaid (provided
that nothing herein shall authorize a prepayment which is not otherwise
permitted hereunder), or converted to another LIBOR Advance or to a Prime
Advance, as the case may be, but shall be payable on the next Payment Date.
Interest, Unused Credit Fees and Facility Letter of Credit Fees shall be
calculated for actual days elapsed on the basis of a 360-day year. Interest
shall be payable for the day an Advance is made but not for the day of any
payment on the amount paid if payment is received prior to 1:00 p.m. (Atlanta
time) at the place of payment, unless such Advance is repaid on the date that it
was made. If any payment of principal of or interest on an Advance shall become
due on a day which is not a Business Day, such payment shall be made on the next
succeeding Business Day and, in the case of a principal payment, such extension
of time shall be included in computing interest in connection with such payment.
2.16. Notification of Advances, Interest Rates and Prepayments.
Promptly after receipt thereof (but in no event later than the close of business
(Atlanta time) one Business Day prior to the proposed Borrowing Date for a Prime
Advance or the close of business three Business Days prior to the proposed
Borrowing Date for a LIBOR Advance) the Agent will notify each Lender in writing
by facsimile of the contents of each Borrowing Notice, Conversion/Continuation
Notice, and prepayment notice received by it hereunder. The Agent will notify
each Lender and the Borrower of the interest rate applicable to each LIBOR
Advance promptly upon determination of such interest rate and will give each
Lender and the Borrower prompt notice of each change in the NationsBank Prime
Rate.
2.17. Lending Installations. Each Lender may book its Loans at any
Lending Installation selected by such Lender and may change its Lending
Installation from time to time. All terms of this Agreement shall apply to any
such Lending Installation and the Notes shall be deemed held by each Lender for
the benefit of such Lending Installation. Each Lender may, by written or telex
notice to the Agent and the Borrower, designate a Lending Installation through
which Loans will be made by it and for whose account Loan payments are to be
made.
2.18. Non-Receipt of Funds By the Agent. Unless the Borrower or a
Lender, as the case may be, notifies the Agent prior to the date on which it is
scheduled to make payment to the Agent of (a) in the case of a Lender, the
proceeds of a Loan or (b) in the case of the Borrower, a payment of principal,
interest or fees to the Agent for the account of the Lenders, that it does not
intend to make such payment, the Agent may assume that such payment has been
made. The Agent may, but shall not be obligated to, make the amount of such
payment available to the intended recipient in reliance upon such assumption. If
the Borrower has not in fact made such payment to the Agent, the recipient of
such payment shall, on demand by the Agent, repay to the Agent the amount so
made available together with interest thereon in respect of each day during the
period
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commencing on the date such amount was so made available by the Agent until the
date the Agent recovers such amount at a rate per annum equal to the Federal
Funds Effective Rate for such day. If a Lender has not in fact made such payment
to the Agent, the Agent shall be entitled to recover such corresponding amount
on demand from such Lender together with interest thereon in respect of each day
during the period commencing on the date such amount was so made available by
the Agent until the date the Agent recovers such amount at a rate per annum
equal to the Federal Funds Effective Rate for such date. If such Lender does not
make such payment upon the Agent's demand therefor, the Agent shall promptly
notify the Borrower, and the Borrower shall immediately pay such amount to the
Agent together with interest thereon in respect of each day during the period
commencing on the date such amount was so made available by the Agent until the
date the Agent recovers such amount at the rate applicable to the relevant Loan.
Nothing in this Section 2.18 shall be deemed to relieve any Lender from its
obligation to fulfill any portion of its Commitment hereunder or to prejudice
any rights which the Borrower may have against any Lender as a result of any
default by such Lender hereunder.
No Lender shall be responsible for any default by any other Lender in
its obligation to make Loans hereunder, and each Lender shall be obligated to
make the Loans provided to be made by it hereunder, regardless of the failure of
any other Lender to fulfill its Commitment hereunder.
2.19. Withholding Tax Exemption. At least five Business Days prior to
the first date on which interest or fees are payable hereunder for the account
of any Lender, each Lender that is not incorporated under the laws of the United
States of America, or a state thereof, agrees that it will deliver to each of
the Borrower and the Agent two duly completed copies of United States Internal
Revenue Service Form 1001 or 4224, certifying in either case that such Lender is
entitled to receive payments under this Agreement and the Notes without
deduction or withholding of any United States federal income taxes and an
Internal Revenue Service Form W-8 or W-9 or applicable successor form, as the
case may be, to establish an exemption from United States backup withholding
tax. Each Lender which so delivers a Form 1001 or 4224 and Form W-8 or W-9
further undertakes to deliver to each of the Borrower and the Agent two
additional copies of such Form (or a successor form) on or before the date that
such form expires (currently, three successive calendar years for Form 1001 and
one calendar year for Form 4224) or becomes obsolete or after the occurrence of
any event requiring a change in the most recent forms so delivered by it, and
such amendments thereto or extensions or renewals thereof as may be reasonably
requested by the Borrower or the Agent, in each case certifying that such Lender
is entitled to receive payments under this Agreement and the Notes without
deduction or withholding of any United States federal income taxes and is exempt
from backup withholding, unless an event (including without limitation any
change in treaty, law or regulation) has occurred prior to the date on which any
such delivery would otherwise be required which renders all such forms
inapplicable or which would prevent such Lender from duly completing and
delivering any such form with respect to it and such Lender advises the Borrower
and the Agent that it is not capable of receiving payments without any deduction
or withholding of United States federal income tax or is not exempt from backup
withholding tax.
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2.20. Voluntary Reduction of Aggregate Commitment Amount Upon at least
five (5) Business Days' prior irrevocable written notice (or telephonic notice
promptly confirmed in writing) to the Agent, the Borrower shall have the right,
without premium or penalty, to permanently reduce the Aggregate Commitment
provided that (a) the Borrower may not reduce the Aggregate Commitment below the
Allocated Facility Amount at the time of such requested reduction, (b) any such
partial reduction shall be in the minimum aggregate amount of U.S. $5,000,000 or
any integral multiple of $5,000,000 in excess thereof and (c) the Borrower may
not reduce the Aggregate Commitment to an amount less than $50,000,000. Any
reduction of the Aggregate Commitment shall be applied pro rata to each Lender's
Commitment. In addition, upon any such reduction, the Agent shall release such
Hotel Properties from the Collateral Pool as are requested by the Borrower in
writing, provided such Hotel Properties released are acceptable to the Lenders
in their sole discretion, and provided the Borrower complies with Section 7.13
hereof and that all covenants and terms of this Agreement remain in compliance
after such release.
2.21. Usury. The Borrower, the Lenders, the Agent and all other parties
to the Loan Documents intend to conform to and contract in strict compliance
with applicable usury law from time to time in effect. All agreements between
the Borrower and the Lenders (or any other party liable with respect to any of
the Obligations) are hereby limited by the provisions of this Section which
shall override and control all such agreements, whether now existing or
hereafter arising. In no way, nor in any event or contingency (including but not
limited to prepayment, default, demand for payment, or acceleration of the
maturity of any Obligation), shall the interest taken, reserved, contracted for,
charged, chargeable, or received under this Agreement, a Note, any of the other
Loan Documents, or otherwise, exceed the Maximum Rate. If, from any possible
construction of any document, interest would otherwise be payable in excess of
the Maximum Amount, any such construction shall be subject to the provisions of
this Section and such document shall ipso facto be automatically reformed and
the interest payable shall be automatically reduced to the Maximum Amount,
without the necessity of execution of any amendment or new document. If any
Lender shall ever receive anything of value which is characterized as interest
under applicable law and which would apart from this provision be in excess of
the Maximum Amount, an amount equal to the amount which would have been
excessive interest shall, without penalty, be applied to the reduction of the
principal amount owing on the Obligations in the inverse order of its maturity
and not to the payment of interest, or be refunded to the Borrower or the other
payor thereof, at the election of such Lender in its sole discretion or as
required by applicable law. The right to accelerate maturity of a Note or any
other Indebtedness does not include the right to accelerate any interest which
has not otherwise accrued on the date of such acceleration, and the Lenders do
not intend to charge or receive any unearned interest in the event of
acceleration. All interest paid or agreed to be paid to the Lenders shall, to
the extent permitted by applicable law, be amortized, prorated, allocated and
spread throughout the full stated term (including any renewal or extension) of
such Indebtedness such that such interest does not exceed the Maximum Amount. As
used in this Section, the term "applicable law" shall mean the laws of such
state or states whose laws are held by any court of competent jurisdiction to
govern or the federal laws of the United States applicable to this transaction,
whichever laws allow the greater interest, as such laws now exist or may be
changed or amended or come into effect in the future.
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2.22. Application of Moneys Received by the Agent. All moneys
collected or received by the Agent on account of the Facility directly or
indirectly, shall be applied in the following order of priority:
(a) to the payment of all reasonable costs (including without
limitation all costs payable to any Lender of which the Agent
has been notified) incurred in the collection of such moneys
of which the Agent shall have given notice to the Borrower;
(b) to the reimbursement of any yield protection due to the
Lenders in accordance with Section 4.1;
(c) to the payment of any fee due to the Issuing Bank pursuant to
Section 3.8(b), to the Lenders pursuant to Section 3.8(a) in
connection with the issuance of a Facility Letter of Credit,
to the payment of the Commitment Fee to the Lenders, to the
payment of the Unused Credit Fee to the Lenders, if any of the
same are then due, in accordance with their Percentages, and
to the payment of the Agent's Fee to the Agent if then due;
(d) (i) in case the entire unpaid principal of the Loan shall not
have become due and payable, the whole amount received as
interest and Facility Letter of Credit Fee then due to the
Lenders (other than a Defaulting Lender) as their respective
Percentages appear or (ii) in case the entire unpaid principal
of the Loan shall have become due and payable, as a result of
a Default or otherwise, to the payment of the whole amount
then due and payable on the Loan for principal, together with
interest thereon at the Default Rate or the interest rate, as
applicable, to the Lenders (other than a Defaulting Lender) as
their respective Percentages appear until paid in full; and
(e) to the payment of any sums due to each Defaulting Lender as
their respective Percentages appear (provided that the Agent
shall have the right to set-off against such sums any amounts
due from such Defaulting Lender).
ARTICLE III
THE LETTER OF CREDIT SUBFACILITY
3.1. Obligation to Issue. Subject to the terms and conditions of
this Agreement and in reliance upon the representations and warranties of the
Borrower herein set forth, the Issuing Bank hereby agrees to issue for the
account of the Borrower, one or more Facility Letters of Credit in accordance
with this Article III, from time to time during the period ending thirty (30)
days prior to the Facility Termination Date.
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3.2. Types and Amounts. The Issuing Bank shall not, except with the
prior written consent of all Lenders:
(a) issue any Facility Letter of Credit if the aggregate maximum
amount then available for drawing under Letters of Credit
issued by such Issuing Bank, after giving effect to the
Facility Letter of Credit requested hereunder, shall exceed
any limit imposed by law or regulation upon such Issuing Bank
provided, in such event, the Borrower shall have the right to
select (with the approval of the alternate Issuing Bank but
not the other Lenders) an alternate Issuing Bank which shall
be one of the Lenders;
(b) issue any Facility Letter of Credit if, after giving effect
thereto, the aggregate Facility Letter of Credit Obligations
would exceed $10,000,000 or the Allocated Facility Amount
would exceed the Aggregate Commitment;
(c) issue any Facility Letter of Credit having an expiration date,
or containing automatic extension provisions to extend such
date, to a date which is less than thirty (30) days preceding
the Facility Termination Date; or
(d) issue any Facility Letter of Credit having an expiration date
which is more than fifteen (15) months after the date of its
issuance.
3.3. Conditions. In addition to being subject to the satisfaction of the
conditions contained in Section 5.2 hereof, the obligation of the Issuing Bank
to issue any Facility Letter of Credit is subject to the satisfaction in full of
the following conditions:
(a) the Borrower shall have delivered to the Issuing Bank at such
times and in such manner as the Issuing Bank may reasonably
prescribe such documents and materials as may be reasonably
required pursuant to the terms of the proposed Facility Letter
of Credit (it being understood that if any inconsistency
exists between such documents and the Loan Documents, the
terms of the Loan Documents shall control) and the proposed
Facility Letter of Credit shall be reasonably satisfactory to
the Issuing Bank as to form and content;
(b) as of the date of issuance, no order, judgment or decree of
any court, arbitrator or governmental authority shall purport
by its terms to enjoin or restrain the Issuing Bank from
issuing the requested Facility Letter of Credit and no law,
rule or regulation applicable to the Issuing Bank and no
request or directive (whether or not having the force of law)
from any governmental authority with jurisdiction over the
Issuing Bank shall prohibit or request that the Issuing Bank
refrain from the issuance of Letters of Credit generally or
the issuance of the requested Facility Letter of Credit in
particular, provided, in such event, the Borrower shall have
the right to select an alternate Issuing Bank which shall be
one of the Lenders;
(c) there shall not exist any Default or Unmatured Default; and
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(d) the Borrower shall have paid those portions of the Facility
Letter of Credit Fee referred to in Section 3.8 hereof that
are due on the Issuance Date.
3.4. Procedure for Issuance of Facility Letters of Credit.
(a) The Borrower shall give the Issuing Bank and the Agent at
least five (5) Business Days' prior written notice of any
requested issuance of a Facility Letter of Credit under this
Agreement substantially in the form of Exhibit I-3 attached
hereto (a "Letter of Credit Request") (except that, in lieu of
such written notice, the Borrower may give the Issuing Bank
and the Agent telephonic notice of such request if confirmed
in writing by delivery to the Issuing Bank and the Agent (i)
by the close of business on such day (A) of a telecopy of the
written notice required hereunder which has been signed by an
Authorized Officer, or (B) of a telex containing all
information required to be contained in such written notice
and (ii) promptly (but in no event later than the requested
date of issuance) of the written notice required hereunder
containing the original signature of an Authorized Officer);
such notice shall specify:
(1) the stated amount of the Facility Letter of Credit
requested (which stated amount shall not be less than
$50,000);
(2) the effective date (which day shall be a Business
Day) of issuance of such requested Facility Letter of
Credit (the "Issuance Date");
(3) the date on which such requested Facility Letter of
Credit is to expire which date (exclusive of
automatic extension periods so long as the Facility
Letter of Credit gives the Issuing Bank the right to
issue a notice that the expiration date will not be
extended) shall be a Business Day and shall in no
event be later than the earlier of fifteen months
after the Issuance Date and thirty (30) days prior to
the Facility Termination Date;
(4) the purpose for which such Facility Letter of Credit
is to be issued (such purpose shall comply with the
requirements of Section 7.2);
(5) the Person for whose benefit the requested Facility
Letter of Credit is to be issued; and
(6) any special language required to be included in the
Facility Letter of Credit.
At the time such request is made, the Borrower shall also provide the
Agent and the Issuing Bank with a copy of the specific form, if any, of the
Facility Letter of Credit that the Borrower is requesting be issued, which shall
be subject to the reasonable approval of the Issuing Bank and the
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Agent. Such notice, to be effective, must be received by such Issuing Bank and
the Agent not later than 2:00 p.m. (Atlanta time) on the last Business Day on
which notice can be given under this Section 3.4(a). The Agent shall promptly
but in no event later than three (3) Business Days prior to the Issuance Date
give a copy of the Letter of Credit Request to the other Lenders. The Borrower
shall also deliver to the Agent and the Issuing Bank the compliance certificate
required in Section 5.2 together with each Letter of Credit Request.
(b) Subject to the terms and conditions of this Article III and
provided that the applicable conditions set forth in Section
5.2 hereof have been satisfied, such Issuing Bank shall, on
the Issuance Date, issue a Facility Letter of Credit on behalf
of the Borrower in accordance with the Letter of Credit
Request and the Issuing Bank's usual and customary business
practices unless the Issuing Bank has actually received (i)
written notice from the Borrower specifically revoking the
Letter of Credit Request with respect to such Facility Letter
of Credit, or (ii) written or telephonic notice from the Agent
stating that the issuance of such Facility Letter of Credit
would violate Section 3.2.
(c) The Issuing Bank shall give the Agent and the Borrower written
or telex notice, or telephonic notice confirmed promptly
thereafter in writing, of the issuance of a Facility Letter of
Credit (the "Issuance Notice") and the Agent shall promptly
give a copy of the Issuance Notice to the other Lenders.
(d) The Issuing Bank shall not extend or amend any Facility Letter
of Credit (other than an automatic extension) unless the
requirements of this Section 3.4 are met as though a new
Facility Letter of Credit was being requested and issued.
(e) The Issuing Bank shall give the Agent written or telex notice,
or telephonic notice confirmed promptly thereafter in writing,
of any extension or amendment of a Facility Letter of Credit
and the Agent shall promptly give a copy of such notice to the
Lenders.
3.5. Reimbursement Obligations, Duties of Issuing Bank.
(a) The Issuing Bank shall promptly notify the Borrower and the
Agent of any draw under a Facility Letter of Credit, and the
Agent shall promptly notify the other Lenders that such draw
has occurred. Any such draw shall constitute an Advance of the
Facility in the amount of the Reimbursement Obligation with
respect to such Facility Letter of Credit and shall bear
interest from the date of the relevant drawing(s) under the
pertinent Facility Letter of Credit at the Prime Rate until
instructed otherwise by the Borrower in accordance with
Section 2.10 hereof; provided that if any Default or an
Unmatured Default involving the payment of money exists at the
time of any such drawing(s), then the Borrower shall reimburse
the Issuing Bank for drawings under a Facility Letter of
Credit issued by the Issuing Bank no later than the next
succeeding Business Day after the payment by the
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Issuing Bank and until repaid such Reimbursement Obligation
shall bear interest from the date funded at the Default Rate.
(b) Any action taken or omitted to be taken by the Issuing Bank
under or in connection with any Facility Letter of Credit, if
taken or omitted in the absence of willful misconduct or gross
negligence, shall not put the Issuing Bank under any resulting
liability to the Borrower or any Lender or, provided that such
Issuing Bank has complied with the procedures specified in
Section 3.4, relieve a Lender of its obligations hereunder to
the Issuing Bank. In determining whether to pay under any
Facility Letter of Credit, the Issuing Bank shall have no
obligation relative to the Lenders other than to confirm that
any documents required to be delivered under such Letter of
Credit appear to have been delivered in compliance, and that
they appear to comply on their face, with the requirements of
such Letter of Credit.
3.6. Participation.
(a) Immediately upon issuance by the Issuing Bank of any Facility
Letter of Credit in accordance with the procedures set forth
in Section 3.4, each Lender shall be deemed to have
irrevocably and unconditionally purchased and received from
the Issuing Bank, without recourse, representation or
warranty, an undivided interest and participation equal to
such Lender's Percentage in such Facility Letter of Credit
(including, without limitation, all obligations of the
Borrower with respect thereto) and any security therefor or
guaranty pertaining thereto. Each Lender's obligation to make
further Loans to the Borrower (other than any payments such
Lender is required to make under subparagraph (b) below) or
issue any Facility Letters of Credit on behalf of the Borrower
shall be reduced by such Lender's Percentage of the undrawn
portion of each Facility Letter of Credit outstanding, as well
as any outstanding Reimbursement Obligations.
(b) In the event that the Issuing Bank makes any payment under any
Facility Letter of Credit and the Borrower shall not have
repaid such amount to the Issuing Bank pursuant to Section 3.7
hereof, the Issuing Bank shall promptly notify the Agent,
which shall promptly notify each Lender of the same, and each
Lender shall within one (1) Business Day unconditionally pay
to the Agent for the account of the Issuing Bank the amount of
such Lender's Percentage of the unreimbursed amount of such
payment, and the Agent shall promptly pay such amount to the
Issuing Bank. Notwithstanding the foregoing, unless the
Borrower shall notify the Agent of the Borrower's intent to
repay the Reimbursement Obligation on the date of the related
drawing under any Facility Letter of Credit, such
Reimbursement Obligation shall simultaneously with such
drawing be converted to and become a Prime Loan as set forth
in Section 2.10. The failure of any Lender to make available
to the Agent for the account of any Issuing Bank its
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Percentage of the unreimbursed amount of any such payment
shall not relieve any other Lender of its obligation hereunder
to make available to the Agent for the account of such Issuing
Bank its Percentage of the unreimbursed amount of any payment
on the date such payment is to be made, but no Lender shall be
responsible for the failure of any other Lender to make
available to the Agent its Percentage of the unreimbursed
amount of any payment on the date such payment is to be made.
Any Lender which fails to make any payment required pursuant
to this Section 3.6(b) shall be deemed to be a Defaulting
Lender hereunder.
(c) If the Issuing Bank receives a payment on account of a
Reimbursement Obligation, including any interest thereon, the
Issuing Bank shall promptly pay to the Agent and the Agent
shall promptly pay to each Lender which has funded its
participating interest therein, in immediately available
funds, an amount equal to such Lender's Percentage thereof.
(d) Upon the request of the Agent or any Lender, an Issuing Bank
shall furnish to the Agent or such Lender copies of any
Facility Letter of Credit to which that Issuing Bank is party
and such other documentation as may reasonably be requested by
the Agent or such Lender.
(e) The obligations of a Lender to make payments to the Agent for
the account of each Issuing Bank with respect to a Facility
Letter of Credit shall be absolute, unconditional and
irrevocable, not subject to any counterclaim, set-off,
qualification or exception whatsoever other than a failure of
any such Issuing Bank to comply with the terms of this
Agreement relating to the issuance of such Facility Letter of
Credit and shall be made in accordance with the terms and
conditions of this Agreement under all circumstances.
3.7. Payment of Reimbursement Obligations.
(a) The Borrower agrees to pay to the Agent for the account of
each Issuing Bank the amount of all Advances for Reimbursement
Obligations, interest and other amounts payable to such
Issuing Bank under or in connection with any Facility Letter
of Credit when due irrespective of any claim, set-off, defense
or other right which the Borrower may have at any time against
any Issuing Bank or any other Person, under all circumstances,
including without limitation any of the following
circumstances:
(i) any lack of validity or enforceability of this
Agreement or any of the other Loan Documents;
(ii) the existence of any claim, setoff, defense or other
right which the Borrower may have at any time against
a beneficiary named in a Facility Letter of Credit or
any transferee of any Facility Letter of Credit (or
any Person for whom any such transferee may be
acting), the Agent, the Issuing Bank, any Lender, or
any other Person, whether in connection with this
Agreement, any Facility Letter of Credit, the
transactions contemplated herein or any
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unrelated transactions (including any underlying
transactions between the Borrower and the beneficiary
named in any Facility Letter of Credit);
(iii) any draft, certificate or any other document
presented under the Facility Letter of Credit proving
to be forged, fraudulent, invalid or insufficient in
any respect of any statement therein being untrue or
inaccurate in any respect;
(iv) the surrender or impairment of any security for the
performance or observance of any of the terms of any
of the Loan Documents; or
(v) the occurrence of any Default or Unmatured Default.
(b) In the event any payment by the Borrower received by the
Issuing Bank or the Agent with respect to a Facility Letter of
Credit and distributed by the Agent to the Lenders on account
of their participations is thereafter set aside, avoided or
recovered from the Agent or the Issuing Bank in connection
with any receivership, liquidation, reorganization or
bankruptcy proceeding, each Lender which received such
distribution shall, upon demand by the Agent, contribute such
Lender's Percentage of the amount set aside, avoided or
recovered together with interest at the rate required to be
paid by the Issuing Bank or the Agent upon the amount required
to be repaid by the Issuing Bank or the Agent.
3.8. Compensation for Facility Letters of Credit.
(a) The Borrower shall pay to the Agent, for the ratable account
of the Lenders, based upon the Lenders' respective
Percentages, a per annum fee (the "Facility Letter of Credit
Fee") with respect to each Facility Letter of Credit that is
equal to 1.50% of the face amount of the Facility Letter of
Credit of which .25% shall be paid to the Issuing Bank on the
Issuance Date as set forth in Section 3.8 (b) hereof. The
balance of the Facility Letter of Credit Fee (1.25%) relating
to any Facility Letter of Credit shall be due and payable in
advance in equal installments (except for the first payment
which may be a partial payment based on the proportionate
share of the quarter then remaining) commencing on the first
day of October, 1997, for any Facility Letter of Credit then
outstanding, and continuing on the first day of the months of
January, April, July, and October each year thereafter, and,
to the extent any such fees are then due and unpaid, on the
Facility Termination Date such unpaid fees shall be due and
payable in full. The Agent shall promptly remit such balance
of the Facility Letter of Credit Fees, when paid, to the
Lenders (including the Issuing Bank) in accordance with their
respective Percentages thereof. The Borrower shall not have
any liability to any Lender for the failure of the Agent to
promptly deliver funds to any such Lender and shall be deemed
to have made all such payments on the date the respective
payment is made by the Borrower to the
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Agent, provided such payment is received by the time specified
in Section 2.15 hereof.
(b) The Issuing Bank shall receive solely for its own account the
aforesaid issuance fee of .25 % of the face amount of each
Facility Letter of Credit, payable by the Borrower on the
Issuance Date for each such Facility Letter of Credit. The
Issuing Bank shall also be entitled to receive its reasonable
out-of-pocket costs and the Issuing Bank's standard charges of
issuing, amending and servicing Facility Letters of Credit and
processing draws thereunder.
3.9. Letter of Credit Collateral Account. The Borrower hereby
agrees that it will, if required pursuant to the terms of a Facility Letter of
Credit or Section 9.1, maintain a special collateral account (the "Letter of
Credit Collateral Account") at the Agent's office at the address specified
pursuant to Section 14.1, in the name of the Borrower but under the sole
dominion and control of the Agent, for the benefit of the Lenders, and in which
the Borrower shall have no interest other than as set forth in Section 9.1. Such
Letter of Credit Collateral Account shall be funded to the extent required by
Section 9.1. In addition to the foregoing, the Borrower hereby grants to the
Agent, for the benefit of the Lenders, a properly perfected security interest in
and to the Letter of Credit Collateral Account, any funds that may hereafter be
on deposit in such account and the proceeds thereof. The Borrower agrees to
execute a security agreement and such other documents as the Agent may require
in connection therewith.
ARTICLE IV
CHANGE IN CIRCUMSTANCES
4.1. Yield Protection. If, after the date hereof, any law or any
governmental or quasi-governmental rule, regulation, policy, guideline or
directive (whether or not having the force of law), or any interpretation
thereof, or the compliance of any Lender therewith,
(a) subjects any Lender or any applicable Lending Installation to
any tax, duty, charge or withholding on or from payments due
from the Borrower (excluding federal, state and local income,
franchise or similar taxes on the overall income of any Lender
or applicable Lending Installation), or changes the basis of
taxation of payments to any Lender in respect of its loans,
Facility Letters of Credit or other amounts due it hereunder,
or
(b) imposes or increases or deems applicable any reserve,
assessment, insurance charge, special deposit or similar
requirement against assets of, deposits with or for the
account of, or credit extended by, any Lender or any
applicable Lending Installation (other than reserves and
assessments taken into account in determining the interest
rate applicable to LIBOR Advances), or
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(c) imposes any other condition the result of which is to increase
the cost to any Lender or any applicable Lending Installation
of making, funding or maintaining loans or reduces any amount
receivable by any Lender or any applicable Lending
Installation in connection with loans, or requires any Lender
or any applicable Lending Installation to make any payment
calculated by reference to the amount of loans held, Letters
of Credit issued or participated in, or interest received by
it, by an amount reasonably deemed material by such Lender
then,
(d) within fifteen (15) days of written demand by such Lender
pursuant to Section 4.4, the Borrower shall pay such Lender
that portion of such increased expense incurred or reduction
in an amount received which such Lender determines is
attributable to making, funding and maintaining its Loans and
its Commitment.
4.2. Changes in Capital Adequacy Regulations. If the amount of
capital required or expected to be maintained by each Lender, the Lending
Installations of the Lenders or the corporations controlling the Lenders (as the
case may be) is increased as a result of a Change (as hereinafter defined),
then, within fifteen days of written demand by such Lender pursuant to Section
4.4, the Borrower shall pay each such Lender the amount necessary to compensate
for any shortfall in the rate of return on the portion on such increased capital
which such Lender determines is attributable to this Agreement, its Loans, its
interest in the Facility Letters of Credit, or its obligation to make Loans
hereunder or participate in or issue Facility Letters of Credit (after taking
into account such Lender's policies as to capital adequacy). "Change" means (i)
any change after the date of this Agreement in the Risk-Based Capital Guidelines
or (ii) any adoption of or change in any other law, rule, regulation, policy,
guideline, interpretation, or directive of any Governmental Authority having
jurisdiction after the date of this Agreement which affects the amount of
capital required or reasonably expected to be maintained by each of the Lenders
or the Lending Installations, or the corporations controlling such Lenders, (as
the case may be). "Risk-Based Capital Guidelines" means (i) the risk-based
capital guidelines in effect in the United States on the date of this Agreement,
including transition rules, and (ii) the corresponding capital regulations
promulgated by regulatory authorities outside the United States implementing the
July 1988 report of the Basle Committee on Banking Regulation and Supervisory
Practices Entitled "International Convergence of Capital Measurements and
Capital Standards," including transition rules, and any amendments to such
regulations adopted prior to the date of this Agreement.
4.3. Funding Indemnification. If any payment of a LIBOR Advance
occurs on a date which is not the last day of the applicable LIBOR Interest
Period, whether because of acceleration, prepayment or otherwise, or a LIBOR
Advance is not made on the date specified by the Borrower for any reason, the
Borrower will pay to the Agent for the benefit of the applicable Lenders the
Break-up Fee upon the Borrower's receipt of the written notice pursuant to
Section 4.5.
4.4. Lender Statements, Survival of Indemnity. To the extent
reasonably possible, each Lender shall designate an alternate Lending
Installation with respect to its LIBOR Loans and shall take other measures in
its discretion to reduce any liability of the Borrower to such Lender under
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Sections 4.1 and 4.2 or to avoid the unavailability of a Type of a LIBOR Advance
under Section 2.11, so long as such designation or other measure is not
disadvantageous to such Lender. Each Lender shall deliver a written statement of
such Lender to the Agent and to the Borrower as to the amount due, if any, under
Sections 4.1, 4.2 or 4.3. Such written statement shall set forth in reasonable
detail the calculations upon which such Lender determined such amount and shall
be final, conclusive and binding on the Borrower in the absence of manifest
error. Determination of amounts payable under such Sections in connection with a
LIBOR Loan shall be calculated as though each Lender funded its LIBOR Loan
through the purchase of a deposit of the type and maturity corresponding to the
deposit used as a reference in determining the LIBOR Rate applicable to such
Loan, whether in fact that is the case or not. Unless otherwise provided herein,
the amount specified in the written statement shall be payable on demand after
receipt by the Borrower of the written statement. The obligations of the
Borrower under Sections 4.1, 4.2 and 4.3 shall survive payment of the
Obligations and termination of this Agreement for a period of one year.
4.5. Limitation on the Borrower's Liability. The Borrower shall not
be obligated to compensate any Lender pursuant to Sections 4.1, 4.2 or 4.3 for
any amounts attributable to a period more than one year prior to such Lender's
written notice under Section 4.4 of its intention to seek compensation under
Sections 4.1, 4.2 or 4.3.
ARTICLE V
CONDITIONS PRECEDENT
5.1. Conditions to Closing.This Agreement shall not be effective
unless and until (a) the Borrower shall have paid all fees then due and payable
to the Lenders, the Agent and the Arranger hereunder, and (b) the Borrower shall
have furnished to the Agent, in form and substance satisfactory to the Lenders
and their counsel and with sufficient copies for the Lenders, the following:
(a) The duly executed originals of the Loan Documents, (all of
which must have been reviewed by and acceptable to the Agent)
including this Agreement;
(b) Certified copies of the articles of incorporation, limited
partnership certificate, limited liability company agreement
or other organizational document of the Borrower, the
Guarantor, each Subsidiary and each Qualified Borrower, to the
extent applicable, with all amendments and certified by the
appropriate governmental officer of the state of organization
as of a recent date, but only to the extent of any changes or
additions thereto since July 30, 1997;
(c) Certificates of good standing for the Borrower, the Guarantor,
each Subsidiary and each Qualified Borrower certified by the
appropriate governmental officer of the state of organization,
and foreign qualification certificates for the Borrower and
the
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Guarantor, certified by the appropriate governmental officer,
for each jurisdiction where any assets are located and each
other jurisdiction where the failure to so qualify or be
licensed (if required) would have a Material Adverse Effect;
(d) Copies, certified by an officer of the Borrower, the
Guarantor, each Subsidiary and each Qualified Borrower, as
applicable, of each of the foregoing Persons' respective
by-laws, partnership agreement, operating agreement or similar
document, to the extent applicable, together with all
amendments thereto, but only to the extent of any changes or
additions thereto since July 30, 1997;
(e) An incumbency certificate, executed by an Authorized Officer
of the Borrower, which shall identify by name and title and
bear the signature of the Persons authorized to sign the Loan
Documents and to make borrowings hereunder on behalf of the
Borrower, upon which certificate the Agent and the Lenders
shall be entitled to rely until informed of any change in
writing by the Borrower;
(f) Copies, certified by the Secretary or Assistant Secretary, of
the Guarantor's (as the sole general partner of the Borrower)
Board of Directors' resolutions (and resolutions of other
bodies, if any are deemed necessary by counsel for any Lender)
authorizing on behalf of the Borrower as its sole general
partner the Advances provided for herein and the execution,
delivery and performance of the Loan Documents to be executed
and delivered by the Borrower hereunder;
(g) A written opinion of the Borrower's and the Guarantor's
counsel, addressed to the Lenders in substantially the form of
Exhibit B hereto;
(h) A certificate, signed by an officer of the Guarantor, as the
sole general partner of the Borrower, stating that on the
Closing Date no Default or Unmatured Default has occurred and
is continuing and that all representations and warranties of
the Borrower contained herein are true and correct as of the
Closing Date as and to the extent set forth herein and that
the Borrower is in compliance with all covenants, terms and
conditions of this Agreement and the other Loan Documents;
(i) A pro forma compliance certificate in the form attached hereto
as Exhibit C;
(j) Evidence that all parties whose consent is required for the
Borrower to execute the Loan Documents have provided such
consents;
(k) Proof acceptable to the Agent that all ad valorem taxes then
due and payable in connection with the Collateral Pool
Properties have been paid; and
(l) Evidence that all Negative Pledge Agreements in connection
with the Negative Collateral Pool have been duly executed and
recorded.
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5.2. Conditions to Each Advance, Issuance of Facility Letter of
Credit and Continuation/Conversion. The following conditions must be satisfied
as a condition precedent to the making of an Advance, the issuance of a Facility
Letter of Credit, or the continuation of a LIBOR Advance or conversion of an
existing Advance into a LIBOR Advance:
(a) There exists no Default or Unmatured Default;
(b) The representations and warranties contained in Article VI are
true and correct as of such Borrowing Date, Issuance Date, or
date of conversion and/or continuation as and to the extent
set forth therein, except to the extent any such
representation or warranty is stated to relate solely to an
earlier date, in which case such representation or warranty
shall be true and correct on and as of such earlier date and
except for Property Breaches, in which case the compliance
certificate shall contain a calculation of the financial
covenants with and without including the Hotel Property with
respect to which there is a Property Breach and demonstrate
compliance with such covenants both with and without inclusion
of such Hotel Property;
(c) All legal matters incident to the making of such Advance shall
be reasonably satisfactory to the Lenders and their counsel;
(d) Written money transfer instructions, in substantially the form
of Exhibit E hereto, addressed to the Agent and signed by an
Authorized Officer, together with such other related money
transfer authorizations as the Agent may have reasonably
requested; and
(e) Such approvals, opinions and documents pertaining to any
Advance requested by or on behalf of a Qualified Borrower as
the Agent may require have been provided.
Each Borrowing Notice, Letter of Credit Request, and
Conversion/Continuation Notice shall constitute a representation and warranty by
the Borrower that the conditions contained in Sections 5.2(a) and (b) have been
satisfied.
5.3 Conditions to Secured Collateral Pool. No Hotel Property may
henceforth be included in the Secured Collateral Pool until the Agent has
received, with respect to each such Hotel Property, each of the following
documents or information, which documents and information shall in all respects
be acceptable in form and substance to the Agent and the Lenders and their
counsel:
(a) Security Documents. Such Security Documents as the Agent shall
require including, without limitation, a Mortgage in
recordable form duly executed by the Borrower in form and
content acceptable to the Agent and its counsel and giving the
Agent a first priority lien on said Hotel Property subject
only to those easements or encumbrances consented to in
writing by the Agent ("Permitted Exceptions").
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(b) Security Agreements. Security Agreements duly executed by the
Borrower, granting to the Agent a first priority security
interest in all furniture, furnishings, equipment, fixtures,
supplies, inventory, accounts, licenses, franchise agreements,
general intangibles and other personal property of every kind
and description used in connection with the ownership,
operation and or management of each such Hotel Property,
together with (i) acknowledgment copies of financing
statements (UCC-1's) duly filed under the Uniform Commercial
Code of all jurisdictions necessary or, in the opinion of the
Agent, desirable to perfect the security interests created by
the Security Agreements; and (ii) certified copies of requests
for information (form UCC-11's) identifying all of the
financing statements on file with respect to the Borrower, the
Guarantor, any Qualified Borrower and the Lessee, as
applicable, indicating that no party claims an interest in any
of the personal property composing part of the Collateral. At
the Agent's option, the Security Agreements may be contained
in the Mortgages.
(c) Evidence of Due Authorization of Security Documents and
Corporate or Partnership Good Standing. Certified copies of
all partnership or corporate action, as applicable, taken by
each party executing a Mortgage, Security Agreement,
Assignments of Rents and Leases, UCC-1 financing statements,
and all other Loan Documents and other instruments,
certificates or agreements required by the Agent, including
resolutions of its board of directors or appropriate
partnership action, as applicable, authorizing the execution,
delivery and performance of the Security Documents and
evidence of the good standing of each party to each of the
Security Documents under their respective state's organization
and any other state the Agent deems necessary or appropriate.
(d) Assignments of Rents and Leases. The Assignment of Rents and
Leases with respect to each such Hotel Property duly executed
by the Borrower, which assignments may be contained in the
Mortgages at the Agent's option.
(e) Franchise Agreements. Copies of the franchise agreement under
which each such Hotel Property will be operated, a copy of the
franchisor's most recent inspection report, and, unless waived
by the Agent, a letter from each franchisor agreeing to give
notices to the Agent of any defaults by the franchisee.
(f) Leases. Copies of each Lease and any service agreements
relating to each such Hotel Property, all of which shall be
acceptable in form and content to the Agent.
(g) Subordinations. Subordination agreement(s) duly executed by
the Lessee under the Leases subordinating the Leases to the
Mortgages.
(h) Management Agreements. Copy of any management agreement for
any Hotel Property subject to a management agreement providing
for management by a
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company satisfactory to the Agent, and an assignment to the
Agent of any such management agreement, as well as the
subordination thereof and management fees thereunder to the
Mortgage for the subject Hotel Property, and the consent of
the manager thereto, all in form and content acceptable to the
Agent and its counsel.
(i) Surveys. An ALTA (or its equivalent acceptable to the Agent)
as-built survey of each such Hotel Property from a licensed
surveyor acceptable to the Agent, the Agent's counsel and the
title insurance company. The survey must be sufficient in form
and content so that the title insurance company will issue an
ALTA mortgagee's title insurance policy in which the standard
boundary, encroachment and survey exceptions have been
deleted. The survey for any Secured Collateral Pool Property
acquired by the Borrower after the date hereof must be dated
within ninety (90) days prior to the issuance of the title
policy and be certified to the Agent and the title insurance
company in form acceptable to the Agent. The survey must show
all easements or restrictions reflected as exceptions in the
title insurance policies and must not show any matters
affecting a particular Hotel Property which is objectionable
to the Agent. The survey shall indicate whether any part of
the particular Hotel Property is located within a flood plain
area.
(j) Title Insurance Policies. A mortgagee title insurance policy
with respect to each such Hotel Property in an amount equal to
45% of the Value as of the date the applicable Hotel Property
is accepted into the Collateral Pool, naming the Agent as the
insured party, showing no liens against such Hotel Property
except for the Mortgage and reflecting fee simple title to the
Hotel Property in the Borrower, subject to no exceptions
except for Permitted Exceptions. Such policy shall be issued
by a title insurance company acceptable to the Agent, and
shall contain affirmative coverage as to survey matters, and
such other affirmative coverage or endorsements (including,
without limitation, so-called tie-in endorsement or equivalent
thereof acceptable to the Agent) as may be reasonably required
by the Agent.
(k) Environmental Audits. A hazardous materials report site
assessment for each such Hotel Property, performed and issued
by a nationally recognized environmental audit firm, or as
otherwise mutually agreed upon by the Borrower and the Agent,
addressed to the Agent as a party entitled to rely thereon,
dated not more than six (6) months prior to the date the
applicable Hotel Property is accepted into the Collateral
Pool, in compliance with the requirements of Exhibit F and
reflecting no indication of adverse environmental conditions
at the subject Hotel Property, including, without limitation,
asbestos, and including a certification that the Hotel
Property is not located on, and has not disturbed, a protected
wetlands area.
(l) Physical Inspections. A report of an independent inspecting
engineering firm satisfactory to the Agent as to the physical
condition of each such Hotel Property reflecting a condition
of such Hotel Property acceptable to the Agent and the
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independent satisfaction of the Agent with the physical
condition of the Hotel Property pursuant to the on-site
inspection of officers of the Agent, for which inspections
such officers shall be permitted access to the Hotel Property
during reasonable hours. All out of pocket expenses incurred
by the Agent in connection with such inspections shall be
payable on demand by the Borrower.
(m) Certificates of Insurance. Each of (i) a current certificate
of insurance as to the insurance maintained by the Borrower on
such Hotel Property (including flood insurance if necessary)
from the insurer or an independent insurance broker dated as
of the date of determination, identifying insurers, types of
insurance, insurance limits, and policy terms (which
certificate may evidence inclusion of such Hotel Property
under a "blanket" policy maintained by the Borrower); (ii)
certified copies of all policies evidencing such insurance (or
certificates therefor signed by the insurer or an agent
authorized to bind the insurer); and (iii) such further
information and certificates from the Borrower, its insurers
and insurance brokers as the Agent may request.
(n) Appraisals. Any existing appraisal of each such Hotel Property
which the Borrower may have access to. (Upon any Default or
Unmatured Default the Agent may order an appraisal on any or
all Collateral Pool Properties at the Borrower's expense
prepared by an MAI appraiser acceptable to the Agent).
(o) Environmental Indemnity. An Environmental Indemnity Agreement
in form and content satisfactory to the Agent and its counsel,
executed by the Borrower, with respect to each such Hotel
Property.
(p) Opinion of Counsel. The favorable opinion of counsel for the
Borrower qualified to practice in the State in which the Hotel
Property is located, addressed to Agent as to the
enforceability against the Borrower of the Security Documents,
as applicable, and all other documents to be delivered by such
entities and, with respect to the Borrower, specifically
opining as to the existence and sufficiency of consideration
for the Security Documents to be signed by it, each such
opinion letter to be in form and content acceptable to the
Agent, and opining as to such other matters as the Agent may
request.
(q) Independent Market Study. An independent market study
acceptable to the Agent on each such Hotel Property.
(r) Certificate of Occupancy; As Built Plans and Specifications.
To the extent available or obtainable, a copy of the
certificate of occupancy for such Hotel Property, or other
evidence satisfactory to the Agent that no certificate of
occupancy is necessary to the use and occupation thereof,
together with a copy of as-built plans and specifications for
such Hotel Property, showing all improvements thereon to the
fullest extent available to the Borrower or in the Borrower's
possession.
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(s) Zoning Compliance. A zoning letter or certificate from the
appropriate local official (or other evidence satisfactory to
the Agent) confirming that the use of the Hotel Property is in
compliance with zoning regulations or is an otherwise
permitted use, and other evidence reasonably satisfactory to
the Agent that in case of casualty the improvements could be
rebuilt in substantially the manner existing prior to such
casualty.
(t) Permit Assurances. Evidence by the Borrower or the Borrower's
agents or representatives reasonably satisfactory to the Agent
that all activities being conducted on such Hotel Property
which require federal, state or local licenses or permits have
been duly licensed and that such licenses or permits are in
full force and effect.
(u) Operating Statements. Operating statements for such Hotel
Property in form acceptable to the Agent covering each of the
last twelve (12) consecutive calendar months (or, if twelve
(12) calendar months have not passed since completion of
construction of such Hotel Property, an operating statement
for each quarter since such completion) ending immediately
prior to the addition of such Hotel Property to the Secured
Collateral Pool; provided, however, that if twelve (12)
calendar months have not passed since the Borrower acquired
title to the Hotel Property, such operating statements for
periods prior to the Borrower's ownership as are in the
Borrower's possession or reasonably obtainable by the
Borrower.
(v) Doing Business Opinion or Title Endorsement. For Hotel
Properties located in such states as the Agent may designate,
either (i) an opinion, dated the date of the inclusion of each
such Hotel Property in the Secured Collateral Pool, of legal
counsel acceptable to the Agent qualified to practice in the
state in which such Hotel Property is located, or (ii) a
doing-business endorsement to the title insurance policy
required by Section 5.3 (j) hereof, each to the effect that
neither the Agent nor any Lender shall be required to qualify
to do business in such state or any political subdivision
thereof or to become liable to pay any taxes in such state or
any political subdivision thereof solely on account of the
receipt of the security title or lien on such Hotel Property
securing the Obligations, such opinion or endorsement to be
satisfactory to the Agent, subject to practices customary in
such state with respect to the scope and substance of such
opinion or endorsement.
(w) Photographs. Photographs of the Hotel Property, and a listing
of amenities.
(x) Legal Description. A legal description of the Hotel Property.
(y) Site Plan. A site plan.
(z) Location Map. A location map with the Hotel Property clearly
identified thereon.
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(aa) Borrowing Base. The Cost and Implied Value for each Hotel
Property from which the Borrowing Base can be determined.
(bb) Pro forma Compliance Certificate. A pro forma compliance
certificate in the form attached hereto as Exhibit C.
(cc) Other Documents. Such other approvals, opinions, information
or documents as the Agent may request, it being understood
that all Hotel Properties now or hereafter being considered
for inclusion in the Secured Collateral Pool must be
acceptable to the Lenders.
If at any time the Agent reasonably determines, in its sole discretion,
that a Hotel Property should be removed from the Secured Collateral Pool,
whether due to environmental concerns which have changed or become known since
the date of inclusion in the Secured Collateral Pool, casualty or otherwise, the
Agent shall so notify the Borrower in writing and such Hotel Property shall
thereafter no longer be considered part of the Secured Collateral Pool, nor
included in the calculation of the Borrowing Base. Any such Hotel Property so
removed from the Secured Collateral Pool shall upon written request from the
Borrower be released by the Agent from the lien of any Mortgage provided there
is then existing no Default or Unmatured Default hereunder and the provisions of
Section 7.13 hereof have been complied with. In addition, the Borrower may
substitute another Hotel Property for the one removed from the Secured
Collateral Pool provided such new Hotel Property is acceptable to the Lenders
and all conditions precedent to the inclusion of such Hotel Property in the
Secured Collateral Pool have been complied with including, without limitation,
the provisions of Section 7.13 hereof.
5.4 Conditions to Negative Collateral Pool. No Hotel Property may
be included in the Negative Collateral Pool until the Agent has received, with
respect to each such Hotel Property, each of the following documents or
information, which documents and information shall in all respects be acceptable
in form and substance to the Agent and the Lenders and their counsel:
(a) Negative Pledge. The Negative Pledge Agreement.
(b) UCC Searches. Certified copies of requests for information
(form UCC-11) identifying all of the financing statements on
file with respect to the Borrower, the Guarantor, any
Qualified Borrower and the Lessee, as applicable, indicating
that no Person claims an interest in any of the personal
property belonging to the Borrower and located on or at the
Hotel Property.
(c) Evidence of Due Authorization and Corporate or Partnership
Good Standing. Certified copies of all partnership or
corporate action, as applicable, taken by each party executing
a Negative Pledge Agreement, and all other Loan Documents and
other instruments, certificates or agreements required by the
Agent, including resolutions of its board of directors or
appropriate partnership action, as applicable,
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authorizing the execution, delivery and performance of the
Negative Pledge Agreement and evidence of the good standing of
each party to each Negative Pledge Agreement under their
respective state's organization and any other state the Agent
deems necessary or appropriate.
(d) Franchise Agreements. Copies of the franchise agreement under
which each such Hotel Property will be operated, a copy of the
franchisor's most recent inspection report, and, unless waived
by the Agent, a letter from each franchisor agreeing to give
notices to the Agent of any defaults by the franchisee.
(e) Leases. Copies of each Lease and any service agreements
relating to each such Hotel Property all of which shall be
acceptable in form and content to the Agent.
(f) Management Agreements. Copy of any management agreement for
any Hotel Property subject to a management agreement providing
for management by a company satisfactory to the Agent, and an
assignment to the Agent of any such management agreement, all
in form and content acceptable to the Agent and its counsel.
(g) Title Insurance Policies; Updated Searches. Copies of any
owner's title insurance policy with respect to each such Hotel
Property showing no liens encumbering such Hotel Property and
reflecting fee simple title to the Hotel Property in the
Borrower, subject to no exceptions except for Permitted
Exceptions. The Borrower shall also provide updated title
searches or abstracts sufficient to allow the Agent to
determine the Hotel Property is unencumbered as of the date
hereof.
(h) Environmental Audits. Any existing hazardous materials report
site assessment for each such Hotel Property, reflecting no
indication of adverse environmental conditions at the subject
Hotel Property, including, without limitation, asbestos, and
including a certification that the Hotel Property is not
located on, and has not disturbed, a protected wetlands area.
(i) Physical Inspections. Any existing report of an inspecting
engineering firm as to the physical condition of each such
Hotel Property reflecting a condition of such Hotel Property
acceptable to the Agent and the independent satisfaction of
the Agent with the physical condition of the Hotel Property
pursuant to the on-site inspection of officers of the Agent,
for which inspections such officers shall be permitted access
to the Hotel Property during reasonable hours. All out of
pocket expenses incurred by the Agent in connection with such
inspections shall be payable on demand by the Borrower.
(j) Appraisals. Any existing appraisal of each such Hotel Property
which the Borrower may have access to. (Upon any Default or
Unmatured Default the Agent may order
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an appraisal on any or all Collateral Pool Properties at the
Borrower's expense prepared by an MAI appraiser acceptable to
the Agent).
(k) Environmental Indemnity. An Environmental Indemnity Agreement
in form and content satisfactory to the Agent and its counsel,
executed by the Borrower, with respect to each such Hotel
Property.
(l) Operating Statements. Operating statements for such Hotel
Property acceptable to the Agent covering each of the last
twelve (12) consecutive calendar months (or, if twelve (12)
calendar months have not passed since completion of
construction of such Hotel Property, an operating statement
for each quarter since such completion) ending immediately
prior to the addition of such Hotel Property to the Negative
Collateral Pool; provided, however, that if twelve (12)
calendar months have not passed since the Borrower acquired
title to the Hotel Property, such operating statements for
periods prior to the Borrower's ownership as are in the
Borrower's possession or reasonably obtainable by the
Borrower.
(m) Photographs. Photographs of the Hotel Property, and a listing
of amenities.
(n) Legal Description. A legal description of the Hotel Property.
(o) Site Plan. A site plan.
(p) Location Map. A location map with the Hotel Property clearly
identified thereon.
(q) Independent Market Study. An independent market study
acceptable to the Agent.
(r) Borrowing Base. The Cost and Implied Value for each Hotel
Property from which the Borrowing Base can be determined.
(s) Pro forma Compliance Certificate. A pro forma compliance
certificate in the form attached hereto as Exhibit C.
(t) Other Documents. Such other approvals, opinions, information
or documents as the Agent may request.
If at any time the Agent reasonably determines, in its sole discretion,
that a Hotel Property should be removed from the Negative Collateral Pool,
whether due to environmental concerns which have changed or become known since
the date of inclusion in the Negative Collateral Pool, casualty or otherwise,
the Agent shall so notify the Borrower in writing and such Hotel Property shall
thereafter no longer be considered part of the Negative Collateral Pool, nor
included in the calculation of the Borrowing Base. Any such Hotel Property so
removed from the Negative Collateral Pool shall upon written request from the
Borrower be released from the Negative Pledge Agreement applicable thereto
provided there is then existing no Default or Unmatured Default
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hereunder, and the provisions of Section 7.13 hereof have been complied with. In
addition, the Borrower may substitute another Hotel Property for the one removed
from the Negative Collateral Pool provided such Hotel Property is acceptable to
the Lenders and all conditions precedent to the inclusion of such Hotel Property
in the Negative Collateral Pool have been complied with.
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ARTICLE VI
REPRESENTATIONS AND WARRANTIES
The Borrower and the Guarantor represent and warrant to the Lenders
that as of the date hereof, and as of each Borrowing Date, Issuance Date and
each conversion and/or continuation (except as otherwise disclosed to and
approved by the Required Lenders):
6.1. Existence. They are duly organized, validly existing and in good
standing under the laws of the State of Tennessee, with their principal places
of business in Memphis, Tennessee, and are duly qualified as a foreign
partnership or corporation (as applicable), properly licensed (if required), in
good standing and have all requisite authority to conduct their business in each
jurisdiction in which either owns Hotel Properties and, except where the failure
to be so qualified or to obtain such authority would not have a Material Adverse
Effect, in each other jurisdiction in which their business is conducted. Each of
their Subsidiaries, Qualified Borrowers and Investment Affiliates is duly
organized, validly existing and in good standing under the laws of its
jurisdiction of organization and has all requisite authority to conduct its
business in each jurisdiction in which it owns Hotel Property, and except where
the failure to be so qualified or to obtain such authority would not have a
Material Adverse Effect, in each other jurisdiction in which it conducts
business.
6.2. Authorization and Validity. They have the power and authority and
legal right to execute and deliver the Loan Documents and to perform their
respective obligations thereunder. The execution and delivery by them of the
Loan Documents and the performance of their obligations thereunder have been
duly authorized by proper proceedings, and the Loan Documents constitute legal,
valid and binding obligations of the Borrower and the Guarantor enforceable
against them in accordance with their terms, except as enforceability may be
limited by bankruptcy, insolvency or similar laws affecting the enforcement of
creditors' rights generally and general principles of equity (regardless of
whether enforcement is sought in a proceeding in equity or at law).
6.3. No Conflict; Government Consent. Neither the execution and
delivery by them of the Loan Documents, nor the consummation of the transactions
therein contemplated, nor compliance with the provisions thereof will violate in
any material respect any law, rule, regulation, order, writ, judgment,
injunction, decree or award binding on, respectively, the Borrower, the
Guarantor or any of their Subsidiaries or Qualified Borrowers or any of such
entities' articles of incorporation, by-laws, certificates of limited
partnership, partnership agreements or operating agreements, as the case may be,
or the provisions of any indenture, declaration of trust, instrument or
agreement to which any entity is a party or is subject, or by which it, or its
Hotel Property, is bound, or conflict with or constitute a default thereunder,
or result in the creation or imposition of any Lien in, of or on the Hotel
Property of such entity pursuant to the terms of any such indenture, instrument
or agreement. No order, consent, approval, license, authorization, or validation
of, or filing, recording or registration with, or exemption by, any governmental
or public body or authority, or any subdivision thereof, is required to
authorize, or is required in connection
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with the execution, delivery and performance of, or the legality, validity,
binding effect or enforceability of, any of the Loan Documents.
6.4. Financial Statements; Material Adverse Change. The most recent
consolidated financial statements of the Borrower, the Guarantor and their
Subsidiaries delivered to the Lenders prior to the date that this representation
is made were prepared in accordance with GAAP in effect on the date such
statements were prepared and fairly present the consolidated financial condition
and operations of the Borrower, the Guarantor and their Subsidiaries at such
date and the consolidated results of their operations for the period then ended.
Since the date of such financial statements, there has been no change in the
business, property, results of operations or financial condition of the
Borrower, the Guarantor or their Subsidiaries which have or could be reasonably
expected to have a Material Adverse Effect.
6.5. Taxes. The Borrower, the Guarantor and their Subsidiaries, and any
Qualified Borrowers, have filed all United States federal tax returns and all
other tax returns which are required to be filed and have paid all taxes due
pursuant to said returns or pursuant to any assessment received by,
respectively, the Borrower, the Guarantor, any of their Subsidiaries or any
Qualified Borrowers, except such taxes, if any, as are being contested in good
faith and as to which adequate reserves have been provided. No tax liens have
been filed and no claims are being asserted with respect to any such taxes. The
charges, accruals and reserves on the books of the Borrower, the Guarantor and
their Subsidiaries, and to the Borrower's and the Guarantor's collective
knowledge, their Qualified Borrowers in respect of any taxes or other
governmental charges are adequate.
6.6. Litigation and Contingent Obligations. Except as set forth on
Schedule 6, there is no litigation, arbitration, governmental investigation or
proceeding pending or, to the knowledge of any of the Guarantor's officers,
threatened, in a writing received by the Borrower, the Guarantor, a Subsidiary,
or a Qualified Borrower, against or affecting the Borrower , the Guarantor or
any of their Subsidiaries, Qualified Borrowers or Investment Affiliates which,
if adversely determined, would have a Material Adverse Effect. Except as
disclosed on Schedule 7, they have no material contingent obligations not
provided for or disclosed in the financial statements referred to in Section
7.1, which would have or could be reasonably expected to have a Material Adverse
Effect.
6.7. Subsidiaries. Schedule 1 hereto contains an accurate list of all
of the presently existing Subsidiaries and Investment Affiliates of the Borrower
and the Guarantor, setting forth their respective jurisdictions of formation,
the percentage of their respective Capital Stock owned by them or their
Subsidiaries, properties owned and a description of its business and with
respect to Investment Affiliates, whether such Investment Affiliate constitutes
a Qualified Borrower. All of the issued and outstanding shares of Capital Stock
of such Subsidiaries and, to the Borrower's and the Guarantor's collective
knowledge, such Investment Affiliates have been duly authorized and issued and
are fully paid and non-assessable.
6.8. ERISA. The Unfunded Liabilities of all Single Employer Plans do
not in the aggregate exceed $1,000,000. Neither the Borrower nor the Guarantor,
nor any other member of
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the Controlled Group has incurred any withdrawal liability to Multiemployer
Plans in excess of $250,000 in the aggregate. If withdrawals from all
Multiemployer Plans occurred, the liability would not exceed $250,000. Each Plan
and, to the Borrower's and the Guarantor's collective knowledge, each
Multiemployer Plan, complies in all material respects with all applicable
requirements of law and regulations and the Borrower, the Guarantor and all
members of the Controlled Group have complied in all material respects with
ERISA and the Code with respect to each Plan. No Reportable Event has occurred
with respect to any Plan, neither the Borrower nor the Guarantor nor any other
member of the Controlled Group has withdrawn from any Plan or Multiemployer Plan
or initiated steps to do so, and no steps have been taken to reorganize or
terminate any Plan or, to the Borrower's or the Guarantor's collective
knowledge, Multiemployer Plan. Neither the Borrower nor the Guarantor nor any
member of the Controlled Group has any Plans or is a party to any collective
bargaining agreements other than those listed on Schedule 3. There is no
accumulated funding deficiency (as defined in Section 412 of the Code or Section
302 of ERISA) outstanding which could reasonably be expected to have a Material
Adverse Effect, there is no lien outstanding under Section 412 of the Code or
Section 302 of ERISA with respect to assets of the Borrower or the Guarantor or
any member of the Controlled Group and no requirement to provide security under
Section 401(a)(29) of the Code or Section 307 of ERISA has been or is reasonably
expected to be imposed on assets of the Borrower, the Guarantor or any member of
the Controlled Group. No liability to the PBGC or the Internal Revenue Service
with respect to any Plan or Multiemployer Plan or trust related thereto has been
or is reasonably expected to be incurred by the Borrower or the Guarantor or any
member of the Controlled Group which could reasonably be expected to have a
Material Adverse Effect. Neither the Borrower nor the Guarantor nor any member
of the Controlled Group has any contingent liability with respect to any
post-retirement benefits under any "welfare plan" (as defined in Section 3(l) of
ERISA) nor withdrawal liability or exit fee or charge with respect to any such
postretirement benefits under any welfare plan which could reasonably be
expected to have a Material Adverse Effect. Throughout the term of the Loan, the
Borrower and the Guarantor are not and neither will be an "employee benefit
plan" as defined in Section 3(32) of ERISA or a "governmental plan" within the
meaning of Section 3(3) of ERISA, none of the assets of the Borrower or the
Guarantor will constitute "plan assets" of one or more plans for purposes of
Title I of ERISA, and neither the Borrower nor the Guarantor will be subject to
state statutes applicable to Borrower or the Guarantor regulating investments
and fiduciary obligations with respect to governmental plans.
6.9. Accuracy of Information. All factual information heretofore or
contemporaneously furnished by or on behalf of the Borrower, the Guarantor or
any of their Subsidiaries or any Investment Affiliates, or Qualified Borrowers,
to the Agent or any Lender for purposes of or in connection with this Agreement
or any transaction contemplated hereby is, and all other such factual
information hereafter furnished by or on behalf of the Borrower, the Guarantor
or any of their Subsidiaries, any Investment Affiliates or Qualified Borrowers
to the Agent or any Lender will be, true and accurate (taken as a whole) on the
date as of which such information is dated or certified and not incomplete by
omitting to state any material fact necessary to make such information (taken as
a whole) not misleading at such time. There are no facts, events or conditions
directly and specifically affecting the Borrower, the Guarantor, their
Subsidiaries or any Investment Affiliate or Qualified Borrower known to the
Borrower or the Guarantor and not disclosed to the Agent or not disclosed in the
information furnished by or on behalf of the
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Borrower, the Guarantor, their Subsidiaries or any Investment Affiliates or
Qualified Borrowers, which, in the aggregate, have or could be reasonably
expected to have a Material Adverse Effect.
6.10. Regulation U. They do not hold any margin stock (as defined in
Regulation U).
6.11. Material Agreements. Neither they nor any Subsidiary or
Investment Affiliate or Qualified Borrower is in default in the performance,
observance or fulfillment of any of the obligations, covenants or conditions
contained in (i) any agreement to which it is a party, which default could have
a Material Adverse Effect, or (ii) except as disclosed on Schedule 8 any
agreement or instrument evidencing or governing Indebtedness.
6.12. Compliance With Laws. Except as set forth in Schedule 5 they and
their Subsidiaries and any Investment Affiliates and Qualified Borrowers have
complied in all material respects, to their collective knowledge, with all
applicable statutes, rules, regulations, orders and restrictions of any domestic
or foreign government or any instrumentality or agency thereof, having
jurisdiction over the conduct of their respective businesses or the ownership of
their respective Hotel Property except where such non-compliance would not have
a Material Adverse Effect. Except as disclosed on Schedule 5, neither the
Borrower, the Guarantor, any Subsidiary, nor any Investment Affiliate nor any
Qualified Borrower, has received any written notice to the effect that its
operations are not in material compliance with any of the requirements of
applicable federal, state and local environmental, health and safety statutes
and regulations or the subject of any federal or state remedial action
responding to a release of any toxic or hazardous waste or substance into the
environment, which non-compliance or remedial action could have a Material
Adverse Effect.
6.13. Ownership of Collateral Pool Properties. On the date of this
Agreement, the Borrower will have good title, free of all Liens other than
Permitted Liens, to all of the Collateral Pool Properties as identified on
Exhibits G and H.
6.14. Investment Company Act. Neither Borrower, the Guarantor nor any
Subsidiary or any Investment Affiliate or Qualified Borrower is an "investment
company" or a company "controlled" by an "investment company", within the
meaning of the Investment Company Act of 1940, as amended.
6.15. Public Utility Holding Company Act. Neither Borrower, the
Guarantor nor any Subsidiary or any Investment Affiliate or Qualified Borrower
is a "holding company" or a "subsidiary company" of a "holding company", or an
"affiliate" of a "holding company" or of a "subsidiary company" of a "holding
company", within the meaning of the Public Utility Holding Company Act of 1935,
as amended.
6.16. Solvency.
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EXHIBIT 10.12
(a) Immediately after the Closing Date and immediately following
the making of each Loan and after giving effect to the
application of the proceeds of such Loans, (a) the fair value
of the assets of the Borrower, the Guarantor and their
Subsidiaries on a consolidated basis, at a fair valuation,
will exceed the debts and liabilities, subordinated,
contingent or otherwise, of the Borrower, the Guarantor and
their Subsidiaries on a consolidated basis; (b) the present
fair saleable value of all property of the Borrower, the
Guarantor and their Subsidiaries on a consolidated basis will
be greater than the amount that will be required to pay the
probable liability of the Borrower, the Guarantors and their
Subsidiaries on a consolidated basis on their debts and other
liabilities, subordinated, contingent or otherwise, as such
debts and other liabilities become absolute and matured; (c)
the Borrower, the Guarantor and their Subsidiaries on a
consolidated basis will be able to pay their debts and
liabilities, subordinated, contingent or otherwise, as such
debts and liabilities become absolute and matured; and (d) the
Borrower, the Guarantor and their Subsidiaries on a
consolidated basis will not have unreasonably small capital
with which to conduct the businesses in which they are engaged
as such businesses are now conducted and are proposed to be
conducted after the date hereof .
(b) They do not intend to, or to permit any of their Subsidiaries,
Investment Affiliates or Qualified Borrowers to incur debts
beyond their ability to pay such debts as they mature, taking
into account the timing of and amounts of cash to be received
by them or any such Subsidiary and the timing of the amounts
of cash to be payable on or in respect of their Indebtedness
or the Indebtedness of any such Subsidiary.
6.17. Insurance. While any of the Obligations remain outstanding the
Borrower shall procure and maintain or shall cause to be procured and
maintained continuously in effect, policies of insurance in form and amounts
and issued by companies, associations or organizations licensed to do business
in the states in which the Collateral Pool Properties are located, with a
Best's Rating of no less than A, XII and otherwise satisfactory to the Agent
covering such casualties, risk, perils, liabilities and other hazards
reasonably required by the Agent. All original policies, or certificates
thereof, and endorsements and renewals thereof shall be delivered to and
retained by the Agent unless the Agent waives this requirement in writing. All
policies shall expressly protect or recognize the Lenders' interests as
required by the Agent. Without limiting the generality of the foregoing, the
Borrower shall provide or cause to be provided the following types of insurance
coverage:
(a) Until repayment and/or fulfillment of the Obligations: (i)
property insurance on a "special causes of loss" replacement
cost basis (or fire, extended coverage and difference in
conditions basis) including flood, earthquake and sinkhole
coverages in amount equal to the replacement cost of the
Collateral Pool Properties, naming the Agent as mortgagee and
loss/payee under a standard form mortgagee clause; (ii)
Comprehensive General Liability Insurance (including
contractual liability, owners and contractors protective
coverages, products & completed operations, personal &
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advertising injury liability, fire damage, legal liability and
alienated premises coverage) and Comprehensive Auto Liability
Insurance in a minimum amount of $20,000,000 per each
occurrence; (iii) Statutory Workers' Compensation and
Employer's Liability Insurance in the minimum amounts of
$1,000,000 each accident, $1,000,000 each employee-disease,
$1,000,000 policy limit-disease; and (iv) Rent loss insurance
against loss of income by reason of any hazard covered under
the insurance required under this subparagraph (a) in an
amount sufficient to avoid any co-insurance penalty, but in
any event for not less than two (2) years gross receipts from
all sources of income from the Collateral Pool Properties.
(b) Such additional insurance as may be reasonably required by the
Agent from time to time in the event that any of the
Collateral Pool Properties are exposed to hazards and risks
with respect to which the Agent deems the existing insurance
inadequate to properly protect its interests.
All policies of insurance shall have attached thereto a lender's loss
payable endorsement for the benefit of the Agent as loss payee, in form
satisfactory to the Agent. The Borrower shall furnish the Agent with a
certified copy of an original or a certificate of insurance of all policies of
insurance required. All policies or certificates, as the case may be, of
insurance shall set forth the coverage, the limits of liability, the name of
the carrier, the policy number, the Bests' Rating of the carrier and the period
of coverage. In addition, all policies of insurance required under the terms
hereof shall (i) contain an endorsement or agreement by the insurer that any
loss shall be payable in accordance with the terms of such policy,
notwithstanding any act or negligence of the Borrower or any party holding
under the Borrower which might otherwise result in a forfeiture of said
insurance and the further agreement of the insurer waiving all rights of
setoff, counterclaim or deductions against the Borrower, (ii) indemnify the
Agent against losses due to its sole or contributory negligence. At least
twenty (20) days prior to the expiration of each required policy, the Borrower
shall deliver to the Agent evidence of the renewal or replacement of such
policy, continuing such insurance in their form as required by this agreement.
All such policies shall contain a provision that notwithstanding any contrary
agreement between the Borrower and the applicable insurance company, such
policies will not be canceled, allowed to lapse without renewal, surrendered or
amended (which provision shall include any reduction in the scope or limits of
coverage) without at least thirty (30) days prior written notice to the Agent.
6.18. NYSE and REIT Status. The Guarantor's common stock is listed
on the New York Stock Exchange and there is no proceeding pending to delist
said stock, and the Guarantor is qualified as a real estate investment trust
and currently is in compliance with all applicable provisions of the Code.
6.19. Environmental Matters. Except as disclosed in Schedule 4,
after due inquiry and investigation in accordance with good commercial or
customary practices, without regard to whether the Agent or the Lenders have or
hereafter obtain any knowledge or report of the environmental condition of any
of the Collateral Pool Properties, each of the following representations and
warranties is true and correct except to the extent that the facts and
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circumstances giving rise to any such failure to be so true and correct, in the
aggregate, could not reasonably be expected to have a Material Adverse Effect:
(a) During the period of the Borrower's, and/or the Guarantor's,
ownership of the Collateral Pool Properties, the Collateral
Pool Properties have not been used for industrial or
manufacturing purposes, for landfill, dumping or other waste
disposal activities or operations, for generation, storage,
use, sale, treatment, processing, recycling or disposal of any
Hazardous Material in violation of any applicable
Environmental Requirement, for underground or aboveground
storage tanks, or for any other use that could give rise to
the release of any Hazardous Material on any of the Collateral
Pool Properties; to the best of their knowledge, no such use
of any of the Collateral Pool Properties occurred at any time
prior to the period of their ownership; and to the best of
their knowledge, no such use on any adjacent property occurred
at any time prior to the date hereof;
(b) to the best of their knowledge, there is no Hazardous
Material, storage tank (or similar vessel) whether underground
or otherwise, sump or well currently on any of the Collateral
Pool Properties;
(c) they have received no notice and have no knowledge of any
Environmental Claim regarding any of the Collateral Pool
Properties or any adjacent property;
(d) the present conditions, uses and activities on the Collateral
Pool Properties do not violate any Environmental Requirement
and the uses of the Collateral Pool Properties which Borrower
(and each tenant and subtenant, if any) makes and intends to
make of the Properties comply and will comply with all
applicable Environmental Requirements; and neither they, nor
to their knowledge, any tenant or subtenant, has obtained or
is required to obtain any permit or other authorization to
construct, occupy, operate, use or conduct any activity on any
of the Collateral Pool Properties by reason of any
Environmental Requirement;
(e) None of the Collateral Pool Properties appear on the National
Priorities List or any other list or database of hotels
maintained by any local, state or federal agency or department
showing Collateral Pool Properties which are known to contain
or which are suspected of containing a Hazardous Material; and
(f) They have never applied for and been denied environmental
impairment liability insurance coverage relating to any of the
Collateral Pool Properties.
6.20. Licenses, etc. The Borrower, the Guarantor, their
Subsidiaries, and any Qualified Borrowers or Investment Affiliates have
obtained and hold in full force and effect, all material trademarks, trade
names, copyrights, licenses, permits, certificates, authorizations,
qualifications, accreditations, easements, rights of way and other rights
consents and approvals which are necessary for the operation of the Collateral
Pool Properties.
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6.21. Judgments. There are no judgments, decrees, or orders of any
kind against the Borrower, the Guarantor, their Subsidiaries, any Qualified
Borrowers or any Investment Affiliates unpaid of record which would have a
Material Adverse Effect.
6.22. Lessee; Property Manager. Except as set forth on Schedule 9,
as of the date hereof, the Lessee and manager of each Collateral Pool Property
is RFS, Inc.
6.23. Updated Schedules. The Borrower will, at the Agent's request,
update any or all of the Schedule(s) to this Agreement by delivery to the Agent
of such revised Schedule(s) and, from and after the date of delivery of such
updated Schedule(s) to the Agent, and its approval by the Required Lenders, the
representations and warranties of the Borrower hereunder shall be deemed to
reflect such revised Schedule, provided, however, in no event may the Borrower
cure any Default hereunder by substituting a revised Schedule for one that was
incorrect when submitted.
6.24. Collateral Pool Properties. Exhibits G and H hereto contain a
complete and accurate list of Hotel Properties in the Secured Collateral Pool
and in the Negative Collateral Pool as of the Closing Date, and as supplemented
from time to time. With respect to each such Collateral Pool Property, the
Borrower hereby represents and warrants as follows except to the extent
disclosed in writing to the Lenders and approved by the Required Lenders (which
approval shall not be unreasonably withheld):
(a) No portion of any improvement on each Collateral Pool Property
is located in an area identified by the Secretary of Housing
and Urban Development or any successor thereto as an area
having special flood hazards pursuant to the National Flood
Insurance Act of 1968 or the Flood Disaster Protection Act of
1973, as amended, or any successor law, or, if located within
any such area, the Borrower has obtained and will maintain the
insurance prescribed in Section 6.17 hereof.
(b) The Borrower, or the Lessee, has obtained all material
certificates, licenses and other approvals, governmental and
otherwise, necessary for the operation of each Collateral Pool
Property and the conduct of its business and all required
zoning, building code, land use, environmental and other
similar permits or approvals which it is required to maintain,
all of which are in full force and effect as of the date
hereof and not subject to revocation, suspension, forfeiture
or modification.
(c) To the Borrower's knowledge, each Collateral Pool Property and
the present use and occupancy thereof are in material
compliance with all applicable zoning ordinances (without
reliance upon adjoining or other properties), building codes,
land use and Environmental Laws, laws relating to the disabled
including, but not limited to, the Americans with Disabilities
Act to the extent applicable, and other similar laws
("Applicable Laws").
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(d) Each Collateral Pool Property is served by all utilities
required for the current or contemplated use thereof. All
utility service is provided by public utilities and each
Collateral Pool Property has accepted or is equipped to accept
such utility service.
(e) All public roads and streets necessary for service of and
access to each Collateral Pool Property for the current or
contemplated use thereof have been completed, are serviceable
and all-weather and are physically and legally open for use by
the public.
(f) Each Collateral Pool Property is served by public water and
sewer systems or, if any Collateral Pool Property is not
serviced by a public water and sewer system, such alternate
systems are adequate and meet, in all material respects, all
requirements and regulations of, and otherwise complies in all
material respects with, all Applicable Laws with respect to
such alternate systems.
(g) The Borrower is not aware of any latent or patent structural
or other significant deficiency of any Collateral Pool
Property. Each Collateral Pool Property is free of damage and
waste that would materially and adversely affect the value
thereof, is in good repair and there is no deferred
maintenance other than ordinary wear and tear. Each
Collateral Pool Property is free from damage caused by fire or
other casualty. There is no pending or, to the actual
knowledge of Borrower threatened condemnation proceedings
affecting any Collateral Pool Property, or any part thereof.
(h) To the Borrower's knowledge, all liquid and solid waste
disposal, septic and sewer systems located on any Collateral
Pool Property are in a good and safe condition and repair and
to the Borrower's knowledge, in compliance with all Applicable
Laws with respect to such systems.
(i) All improvements on each Collateral Pool Property lie within
the boundaries and building restrictions of the legal
description of record of each Collateral Pool Property, no
such improvements encroach upon easements benefiting any
Collateral Pool Property other than encroachments that do not
materially adversely affect the use or occupancy thereof, and
no improvements on adjoining properties encroach upon any
Collateral Pool Property or easements benefitting any
Collateral Pool Property other than encroachments that do not
materially adversely affect the use or occupancy thereof. All
amenities, access routes or other items that materially
benefit each Collateral Pool Property are under direct control
of the Borrower, constitute permanent easements that benefit
all or part of each Collateral Pool Property or are public
property, and each Collateral Pool Property, by virtue of such
easements or otherwise, is contiguous to a physically open,
dedicated all weather public street, and has the necessary
permits for ingress and egress.
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(j) There are no delinquent taxes, ground rents, water charges,
sewer rents, assessments, insurance premiums, leasehold
payments, or other outstanding charges affecting any
Collateral Pool Property except to the extent such items are
being contested in good faith and as to which adequate
reserves have been provided.
(k) Each Collateral Pool Property is assessed for real estate tax
purposes as one or more wholly independent tax lot or lots,
separate from any adjoining land or improvements not
constituting a part of such lot or lots, and no other land or
improvements is assessed and taxed together with any
Collateral Pool Property or any portion thereof.
(l) Each Collateral Pool Property is operated in compliance with a
franchise agreement entered into with a franchise chain
approved by the Lenders, and the Borrower is not in default
under any of the terms thereof.
(m) A breach of any of the representations and warranties
contained in this Section 6.24 with respect to a Collateral
Pool Property shall disqualify, unless otherwise approved by
the Required Lenders, such Collateral Pool Property from being
in the Collateral Pool but shall not constitute a Default
(unless the elimination of such Collateral Pool Property from
the Collateral Pool results in a Default under one of the
other provisions of this Agreement).
ARTICLE VII
COVENANTS
During the term of this Agreement, unless the Required Lenders shall otherwise
consent in writing:
7.1. Financial Reporting. The Borrower and the Guarantor will
maintain, for themselves and each Subsidiary, and shall cause each Qualified
Borrower and Investment Affiliate to maintain, a system of accounting
established and administered in accordance with GAAP, and shall furnish to the
Lenders:
(a) As soon as available, but in any event not later than
forty-five (45) days after the close of each fiscal quarter,
for the Borrower and the Guarantor an unaudited consolidated
balance sheet as of the close of each such period and the
related unaudited consolidated statements of income and
retained earnings and of cash flows of the Borrower, the
Guarantor and their Subsidiaries for such period and the
portion of the fiscal year through the end of such period,
setting forth in each case in comparative form the figures for
the previous year, including, without limitation, a list of
all contingent liabilities, all certified by the Borrower's
and the Guarantor's chief Authorized Officers, and, for the
Guarantor, as soon as available, but in any event not later
than ninety (90) days after the close of each fiscal year,
similar
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audited financial statements prepared by a public accounting
firm acceptable to the Agent;
(b) As soon as available, but in any event not later than
forty-five (45) days after the close of each fiscal quarter,
for the Borrower, the Guarantor and their Subsidiaries,
related reports in form and substance satisfactory to the
Lenders, all certified by the Borrower's and the Guarantor's
chief financial officers or chief accounting officers,
including a statement of Funds From Operations, Market Equity
Capitalization, Adjusted EBITDA, a listing of capital
expenditures (in the level of detail as disclosed in the
Borrower's most recent Form 10Q), a report listing and
describing all Collateral Pool Properties included in either
the Secured or Negative Collateral Pools, including, without
limitation, each Collateral Pool Property's name, franchise
affiliations, lessee name and address, Adjusted Cash Flow,
Borrowing Base, Cost, Property Operating Income, Adjusted
EBITDA, lease payments, real estate taxes, calculation of the
Capital Expenditure Reserve Amount, management fees, occupancy
rates, square footage, date acquired or completed, and such
other information as may be requested to evaluate the
quarterly compliance certificate delivered as provided below;
(c) As soon as publicly available but in no event later than the
date such reports are to be filed with the Securities Exchange
Commission, copies of all Form ▇▇▇▇, ▇▇▇▇, 8Ks, and any other
annual, quarterly, monthly or other reports, copies of all
registration statements and any other public information which
the Borrower, the Guarantor or any of their Subsidiaries files
with the Securities Exchange Commission and to the extent any
of such reports contains information required under the other
subsections of this Section 7.1, the information need not be
furnished separately under the other subsections;
(d) As soon as available, but in any event not later than ninety
(90) days after the close of each fiscal year of the Borrower,
the Guarantor and their Subsidiaries, reports in form and
substance satisfactory to the Lenders, certified by their
respective Authorized Officers containing Property Operating
Income for each Collateral Pool Property;
(e) Not later than forty-five (45) days after the end of each of
the first three fiscal quarters, and not later than ninety
(90) days after the end of the fiscal year, a compliance
certificate in substantially the form of Exhibit C hereto
signed by the Borrower's and the Guarantor's Authorized
Officers confirming that the Borrower and the Guarantor are in
compliance with all of the covenants of the Loan Documents,
showing the calculations and computations necessary to
determine compliance with the financial covenants contained in
this Agreement (including such schedules and backup
information as may be necessary to demonstrate such
compliance) and stating that to such officer's best knowledge,
no other Default or
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Unmatured Default exists, or if any Default or Unmatured
Default exists, stating the nature and status thereof;
(f) As soon as possible and in any event within ten (10) Business
Days after the Borrower or the Guarantor knows that any
Reportable Event has occurred with respect to any Plan, a
statement, signed by their chief Authorized Officers,
describing said Reportable Event and within twenty (20) days
after such Reportable Event, a statement signed by such
Authorized Officers describing the action which they propose
to take with respect thereto; and within ten (10) Business
Days of receipt, any notice from the Internal Revenue Service,
PBGC or Department of Labor with respect to a Plan regarding
any excise tax, proposed termination of a Plan, prohibited
transaction or fiduciary violation under ERISA or the Code
which could result in any liability to the Borrower or the
Guarantor or any member of the Controlled Group in excess of
$100,000; and within ten (10) Business Days of filing, any
Form 5500 filed by the Borrower or the Guarantor with respect
to a Plan, or any member of the Controlled Group which
includes a qualified accountant's opinion.
(g) As soon as possible and in any event within thirty (30) days
after receipt by the Borrower or the Guarantor, a copy of (i)
any notice or claim to the effect that the Borrower or the
Guarantor or any of their Subsidiaries or Qualified Borrowers
or Investment Affiliates is or may be liable to any Person as
a result of the release by such entity, or any of its
Subsidiaries, or any other Person of any toxic or hazardous
waste or substance into the environment, and (ii) any notice
alleging any violation of any federal, state or local
environmental, health or safety law or regulation by the
Borrower, the Guarantor or any of their Subsidiaries or
Qualified Borrowers or Investment Affiliates, which, in either
case, could be reasonably likely to have a Material Adverse
Effect;
(h) Promptly upon the furnishing thereof to the partners of the
Borrowers or shareholders of the Guarantor, copies of all
financial statements, reports and proxy statements so
furnished;
(i) Promptly upon the distribution thereof to the press or the
public, copies of all press releases;
(j) As soon as possible, and in any event within ten (10) days
after the Borrower or the Guarantor knows of any fire or other
casualty or any pending or threatened condemnation or eminent
domain proceeding with respect to all or any portion of any
Collateral Pool Property, a statement signed by the Authorized
Officer of the Borrower or the Guarantor, describing such
fire, casualty or condemnation and the action the Borrower
intends to take with respect thereto;
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(k) Promptly upon the giving of any notices of default under any
of the Leases, copies of all such notices;
(l) Not later than forty-five (45) days after the end of each
quarter, an unaudited financial statement for each Qualified
Borrower that is not a Subsidiary and has received an Advance
(including, without limitation, a balance sheet, income
statement, statement of sources and uses of funds and listing
of contingent liabilities), certified by an Authorized
Officer;
(m) As soon as possible and in any event within thirty (30) days
prior to the commencement of each calendar year, the Borrower
shall supply a detailed capital expenditure budget for that
calendar year for each Collateral Pool Property, all in form
and detail acceptable to the Required Lenders; and
(n) Such other information (including, without limitation,
financial statements for the Borrower or the Guarantor and
non-financial information) as the Agent or any Lender may from
time to time reasonably request.
7.2. Use of Proceeds. (a) The Borrower will use the proceeds of the
Advances and the Facility Letters of Credit for the general business purposes
of the Borrower, including working capital needs, closing costs, and interim or
other financing for acquisitions of new Hotel Properties, construction of new
Hotel Properties or capital improvements or renovations of existing
improvements on Hotel Properties, and to repay outstanding Indebtedness; and
(b) the Borrower will not, nor will it permit any Qualified Borrower or any
Subsidiary to, use any of the proceeds of the Advances (i) to purchase or carry
any "margin stock" (as defined in Regulation U) or (ii) to fund any tender
offer for all or substantially all of another Person's outstanding Capital
Stock registered with the Securities and Exchange Commission under the
Securities Act of 1933, unless such Person shall have consented to such tender
offer prior to its commencement and the Required Lenders shall have consented
to such use of the proceeds of such Advance.
7.3. Notice of Default. The Borrower and the Guarantor will give,
and will cause each of their Subsidiaries and each Qualified Borrower to give,
prompt notice in writing to the Lenders of the occurrence of any Default or
Unmatured Default and of any other development, financial or otherwise, which
could be reasonably likely to have a Material Adverse Effect.
7.4. Conduct of Business. The Borrower and the Guarantor will do,
and will cause each of their Subsidiaries and Qualified Borrowers to do, all
things necessary to remain duly incorporated and/or duly qualified, validly
existing and in good standing as a real estate investment trust, corporation,
general partnership, limited liability company or limited partnership, as the
case may be, in its jurisdiction of incorporation/formation. The Borrower will
maintain all requisite authority to conduct its business in each jurisdiction
in which the Collateral Pool Properties are located and, except where the
failure to be so qualified would not have a Material Adverse Effect, in each
jurisdiction required to carry on and conduct its businesses in substantially
the same manner as it is presently conducted, and, specifically, neither the
Borrower nor the Guarantor nor
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their Subsidiaries nor any Qualified Borrowers will undertake, or be allowed to
undertake, any business other than the acquisition, development, ownership,
management, operation and leasing of Hotel Properties and ancillary businesses
specifically related thereto, except that the Borrower, the Guarantor and their
Subsidiaries and any Qualified Borrowers may invest in the following assets or
property ("Non-Conforming Investments"), subject to such limitations as are
hereinafter set forth:
(a) unimproved land;
(b) other non-income producing property holdings (excluding cash
and Cash Equivalents that are hereby deemed conforming) and
income producing properties other than Hotel Properties or
other investments not considered the Borrower's primary course
of business;
(c) stock holdings (excluding stock holdings in Subsidiaries and
Investment Affiliates engaged in the Borrower's primary course
of business that are hereby deemed conforming);
(d) mortgages; and
(e) Joint Ventures and partnerships (excluding those investments
in Investment Affiliates engaged in the Borrower's primary
course of business that are hereby deemed conforming).
The total investment in Non-Conforming Investments in the aggregate
shall never exceed 15% of Total Assets.
7.5. Taxes. The Borrower and the Guarantor will pay, and will
cause each of their Subsidiaries and Qualified Borrowers to pay, when due all
taxes, assessments and governmental charges and levies upon them of their
income, profits or properties, except those which are being contested in good
faith by appropriate proceedings and with respect to which adequate reserves
have been set aside.
7.6. Insurance. (a) The Borrower and the Guarantor will, and will
cause each of their Subsidiaries and Qualified Borrowers to, maintain with
financially sound and reputable insurance companies insurance on all its
Collateral Pool Properties in such amounts and covering such risks as is
consistent with sound business practice and in compliance with the
representation in Section 6.17, and the Borrower will furnish to the Agent or
any Lender upon request full information as to the insurance carried. (b) The
Borrower will promptly notify the Agent if there has been a termination of any
insurance policy or a material change in coverage or of the credit rating of
the insurer providing such coverage.
7.7. Compliance with Laws. The Borrower and the Guarantor will,
and will cause each of their Subsidiaries and Qualified Borrowers to, be in
material compliance, with all laws, rules
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and regulations and with all final orders, writs, judgments, injunctions,
decrees or awards to which they may be subject.
7.8. Maintenance of Collateral Pool Properties. The Borrower and
the Guarantor will, and will cause each of their Subsidiaries, Qualified
Borrowers, and the Lessee to, do all things necessary to maintain, preserve,
protect and keep the Collateral Pool Properties in good repair, working order
and condition, and make all necessary and proper repairs, renewals and
replacements so that their businesses carried on in connection therewith may be
properly conducted at all times.
7.9. Inspection. Upon reasonable notice, the Borrower and the
Guarantor will, and will cause each of their Subsidiaries and Qualified
Borrowers and the Lessees to, permit the Lenders, by their respective
representatives and agents, to inspect any of the Hotel Properties, books and
financial records of the Borrower and the Guarantor and each of their
Subsidiaries and Qualified Borrowers and the Lessee, to examine and make copies
of the books of accounts and other financial records of the Borrower and the
Guarantor and each of their Subsidiaries, Qualified Borrowers and the Lessee,
and to discuss the affairs, finances and accounts of the Borrower and the
Guarantor and each of their Subsidiaries, Qualified Borrowers and lessees of
Hotel Properties, and to be advised as to the same by, their respective
officers at such reasonable times during normal business hours and reasonable
intervals as the Lenders may reasonably designate.
7.10. Maintenance of Status. The Guarantor shall at all times (a)
maintain the listing of its common stock on the New York Stock Exchange and not
take any action that results in a proceeding to delist such stock, and (b)
maintain its status as a real estate investment trust in compliance with all
applicable provisions of the Code.
7.11. Dividends. Provided there is not a continuing Default under
Section 8.1 or Section 8.2, and there is not a continuing Default under Section
8.3 relating to a breach of any of the covenants contained in Sections 7.4,
7.17 and 7.18, the Guarantor shall be permitted to declare and pay dividends
and similar distributions on its Capital Stock from time to time in amounts
determined by the Guarantor, provided, however, that subject to the terms of
the next sentence, in no event shall the Guarantor declare or pay dividends and
similar distributions on its Capital Stock if dividends paid in any calendar
year would exceed 95% of Funds From Operations for such period.
Notwithstanding the foregoing, unless at the time of distribution there exists
a Default in the payment of principal, interest, or the Commitment Fee, or any
other fees required hereunder, the Guarantor shall be permitted to distribute
whatever amount of dividends is necessary to maintain its tax status as a real
estate investment trust.
7.12. Merger; Sale of Assets. The Borrower and Guarantor will not,
nor will they permit any of their Subsidiaries or Qualified Borrowers to, enter
into any merger, consolidation, reorganization or liquidation or transfer or
otherwise dispose of all or a portion of their property except for (a) such
transactions that occur between Wholly- Owned Subsidiaries, (b) transactions
where the Borrower or the Guarantor is the surviving entity and there is no
change in business conducted or loss of an investment grade rating on such
entity's long-term unsecured debt and no
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other Default results from such transaction, or (c) transactions that are
approved in advance in writing by the Lenders.
7.13. Release of Mortgages or Negative Pledge Agreements. In
addition to any other specific provisions herein allowing the release of a
Mortgage or a Negative Pledge Agreement, provided there is no Default or
Unmatured Default hereunder, the Borrower may by written request to the Agent
obtain a release of a Mortgage or a Negative Pledge Agreement encumbering or
affecting any Collateral Pool Property if such Hotel Property is either being
(i) sold by the Borrower under an arms-length contract to a Person which is not
also the Guarantor, a Subsidiary of the Borrower or the Guarantor, or a
Qualified Borrower, (ii) is being included by the Borrower in a securitization
offering, or (iii) is being removed from the Collateral Pool due to other
reasons as set forth in this Agreement, provided that in any such event at
least one (1) of the following provisions is satisfied:
(a) the Borrower provides a substitute Hotel Property acceptable
to the Lenders and complies with all conditions precedent
herein to the inclusion of such Hotel Property in the
Collateral Pool, or
(b) the outstanding principal balance of the Facility is reduced
in an amount satisfactory to the Lenders and availability
under the Facility is reduced by an equivalent sum on a pro
rata basis.
In addition to the foregoing, in order to obtain a release of any
Mortgage or Negative Pledge Agreements, whether due to the sale of a Collateral
Pool Property, or otherwise, all covenants must still be met as evidenced by a
pro forma compliance certificate in the form attached hereto as Exhibit "C".
Notwithstanding the foregoing, or any other provision herein to the contrary,
the Agent shall be under no obligation to release any Mortgage or Negative
Pledge Agreement if the mix of the remaining Collateral Pool Property types is
not acceptable to the Required Lenders, in their sole but reasonable
discretion.
7.14. Liens. The Borrower and the Guarantor will not, nor will
they permit any of their Subsidiaries or Qualified Borrowers to, create, incur,
or suffer to exist any Lien in, of or on their Collateral Pool Properties,
except:
(a) Liens for taxes, assessments or governmental charges or levies
on their Collateral Pool Properties if the same shall not at
the time be delinquent or thereafter can be paid without
penalty, or are being contested in good faith and by
appropriate proceedings and for which adequate reserves shall
have been set aside on their books;
(b) Liens which arise by operation of law, such as carriers',
warehousemen's, landlords', materialmen and mechanics' liens
and other similar liens arising in the ordinary course of
business which secure payment of obligations not more than
thirty (30)
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days past due or which are being contested in good faith by
appropriate proceedings and for which adequate reserves shall
have been set aside on its books;
(c) Liens arising out of pledges or deposits under worker's
compensation laws, unemployment insurance, old age pensions,
or other social security or retirement benefits, or similar
legislation;
(d) Utility easements, building restrictions, zoning restrictions,
easements and such other encumbrances or charges against real
property as are of a nature generally existing with respect to
properties of a similar character and which do not in any
material way affect the marketability of the same or interfere
with the use thereof in their businesses;
(e) Liens of any Subsidiary, Qualified Borrower or Investment
Affiliate in favor of the Borrower;
(f) Liens existing on the date hereof and described in Schedule 2
hereto; and
(g) Liens arising in connection with any Indebtedness permitted
hereunder to the extent such Liens will not result in a
violation of any of the provisions of this Agreement.
Liens permitted pursuant to this Section 7.14 shall be deemed to be
"Permitted Liens".
7.15. Affiliates. The Borrower and the Guarantor will not, nor will
they permit any of their Subsidiaries or any Qualified Borrowers or Investment
Affiliates to, enter into any transaction (including, without limitation, the
purchase or sale of any Hotel Property or service) with, or make any payment or
transfer to, any Affiliate except in the ordinary course of business and
pursuant to the reasonable requirements of their business and upon fair and
reasonable terms no less favorable to the Borrower or such Subsidiary,
Qualified Borrower or Investment Affiliate than they would obtain in a
comparable arms-length transaction.
7.16. Interest Rate Hedging. The Borrower and the Guarantor will
not enter into or remain liable upon, nor will they permit any Subsidiary,
Qualified Borrower or Investment Affiliate to enter into or remain liable upon,
any agreements, devices or arrangements designed to protect at least one of the
parties thereto from the fluctuations of interest rates, exchange rates or
forward rates applicable to such party's assets, liabilities or exchange
transactions, including, but not limited to, interest rate exchange agreements,
forward currency exchange agreements, interest rate cap or collar protection
agreements, forward rate currency or interest rate options unless such
agreement, device or arrangement was entered into by the Borrower, a
Subsidiary, a Qualified Borrower or Investment Affiliate in the ordinary course
of its business for the purpose of hedging interest rate risk to any of them.
7.17. Consolidated Net Worth. The Borrower, the Guarantor and their
Subsidiaries, as of the last day of any fiscal quarter, shall maintain a
Consolidated Net Worth of not less than the sum
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of (a) the Consolidated Net Worth existing as of December 31, 1996, which is
$357,482,000 plus (b) eighty-five percent (85%) of the net cash proceeds
received by the Guarantor (net of customary related fees and expenses) in
connection with any offering of stock in the Guarantor after December 31, 1996.
7.18. Additional Financial Covenants. The Borrower and the
Guarantor and all Subsidiaries shall at all times comply with the following
additional financial covenants:
(a) Debt Coverage Ratios.
(i) Minimum Collateral Pool Debt Coverage Ratio. The
Borrower, the Guarantor, and their Subsidiaries shall
maintain a minimum debt coverage ratio on the
Collateral Pool Properties of at least 2:00:1.00 at
all times. This ratio shall be calculated by
dividing Adjusted Cash Flow from the Collateral Pool
Properties by Implied Debt Service.
(ii) Minimum Corporate Debt Coverage Ratio. The Borrower,
the Guarantor and their Subsidiaries shall maintain a
minimum consolidated corporate debt coverage ratio of
2.50:1.00 at all times. This ratio shall be
calculated by dividing Adjusted EBITDA by the total
Debt Service on Consolidated Total Indebtedness.
(iii) Special Cure for Debt Coverage Ratio Defaults. For
purposes of determining compliance with the debt
coverage ratio covenants set forth above in Section
7.18, (a)(i) and (ii), upon any Default under said
covenants, and upon the Borrower's written request to
the Agent given no later than two (2) Business Days
after such Default occurs, the Borrower shall be
allowed ninety (90) days from the original date the
Default occurred, to cure such Default before the
Agent and/or the Lenders can exercise their remedies.
If during this time period the Default is not cured,
but the ratio is improved from the previous quarter
by at least 50% of the previous report's short fall
expressed as a percent (i.e. if the ratio was 92% of
the requirement, the ratio must have improved to at
least 96% of the required ratio), the Borrower may
have a second consecutive ninety (90) day cure period
upon written request to the Agent given no later than
two (2) Business Days after the end of the first
ninety (90) day time period. The first and second
cure periods will not be provided to the Borrower if
the Default results from a debt coverage ratio which
is less than 90% of the required covenant, or if any
other Default exists at either time.
(b) Minimum Interest Coverage. The Borrower, the Guarantor and
their Subsidiaries shall maintain a minimum interest coverage
on Consolidated Total Indebtedness of at least 3.00:1.00.
This ratio shall be measured quarterly, using a trailing
twelve
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(12) month rolling average for the immediately preceding
twelve (12) month period, and shall be calculated by dividing
Adjusted EBITDA by Interest Expense.
(c) Total Indebtedness Limitation. Consolidated Total
Indebtedness shall not exceed at any time the lesser of (i)
four (4) times the trailing four (4) quarter Adjusted EBITDA,
or (ii) forty percent (40%) of the Borrower's Cost in all
Hotel Properties. For the purposes of determining compliance
with this covenant, Cost shall include the Borrower's, the
Guarantor's and their Subsidiaries' pro rata Cost in any Hotel
Properties owned by Joint Ventures.
(d) Total Liabilities Limitation. Total Liabilities of the
Borrower, the Guarantor and their Subsidiaries shall not
exceed at any time the lesser of (i) forty percent (40%) of
the sum of their Total Liabilities and the Guarantor's Market
Equity Capitalization, or (ii) forty percent (40%) of the sum
of the Borrower's, the Guarantor's and their Subsidiaries'
Total Liabilities and Consolidated Net Worth.
(e) Borrowing Base to Value Ratio. At no time shall the Borrower
permit the Borrowing Base to Value Ratio to exceed 75%.
(f) Limit on Additional Indebtedness. Neither the Borrower nor
the Guarantor, nor any Qualified Borrower or any of their
Subsidiaries may incur any additional Indebtedness after July
30, 1997 in excess of $15,000,000 without the prior written
approval of all Lenders, which any Lender may grant or
withhold in its sole discretion, provided, however, upon the
receipt by the Guarantor of an investment grade rating on its
senior unsecured debt from Standard & Poors of at least BBB-
and from ▇▇▇▇▇'▇ of at least Baa3, this restriction shall no
longer apply for so long as such grade rating remains in place
and no Default or Unmatured Default exists hereunder, provided
further, however, in no event may the Borrower, the Guarantor,
any Qualified Borrower, or any Subsidiary, incur additional
Indebtedness if the effect would be the loss or downgrading of
such investment grade rating. The restriction set forth in
the preceding sentence of this Section 7.18(f) shall not apply
with respect to non-recourse secured Indebtedness so long as
no Default or Unmatured Default exists hereunder.
(g) Borrowing Base. At no time shall the Allocated Facility
Amount exceed the Borrowing Base.
(h) Leverage Ratio. At no time shall the Leverage Ratio exceed
40%. Nothing contained in the definitions of LIBOR Basis or
Prime Rate shall be deemed to modify this covenant.
7.19. Environmental Matters.
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7.19.1 Violation. The Borrower and the Guarantor will not cause,
commit, permit or allow to continue (i) any violation of any Environmental
Requirement (a) by the Borrower or (b) by or with respect to any of the
Collateral Pool Properties or any use of or condition or activity on any of the
Collateral Pool Properties, or (ii) the attachment of any environmental lien to
any of the Collateral Pool Properties . The Borrower will not place, install,
dispose of or release, or cause, permit, or allow the placing, installation,
disposal, spilling, leaking, dumping or release of, any Hazardous Material or
storage tank (or similar vessel) on any of the Hotel Properties and will keep
the Hotel Properties free of Hazardous Material. Notwithstanding the foregoing
provisions of this Section 7.19, the Borrower shall not be in default hereunder
should the Borrower or the Lessee store minimal quantities of substances on any
of the Hotel Properties which technically could be considered Hazardous
Material, provided that: such substances are of a type and are held only in a
quantity normally used in connection with the construction, occupancy or
operation of comparable buildings (such as cleaning fluids, and supplies
normally used in the day to day operation of business offices), such
substances are being held, stored and used in complete and strict compliance
with all applicable Environmental Requirements, and the indemnity in Section
7.19.5 of this Agreement shall always apply to such substances, and it shall be
and continue to be the responsibility of the Borrower to take, or cause any
tenant to take, all remedial actions required under and in accordance with
Section 7.19.4 of this Agreement in the event of any unlawful release of any
such substance.
7.19.2. Notice to the Lenders. The Borrower shall promptly deliver
to the Agent a copy of each report pertaining to the Collateral Pool Properties
or to the Borrower prepared by or on behalf of the Borrower pursuant to any
Environmental Requirement. The Borrower shall immediately advise the Agent in
writing of any Environmental Claim or of the discovery of any Hazardous
Material on any of the Hotel Properties, as soon as the Borrower first obtains
knowledge thereof, including a full description of the nature and extent of the
Environmental Claim and/or Hazardous Material and all relevant circumstances.
7.19.3. Site Assessments and Information. If the Agent or any Lender
shall ever have reason to believe that any Hazardous Material affects any of
the Hotel Properties, or if any Environmental Claim is made or threatened, or
if a default shall have occurred under the Loan Documents, or upon the
occurrence of the Transition Date (defined below) if requested by the Agent,
the Borrower will at its expense provide to the Agent from time to time, in
each case within thirty (30) days after the Agent's request, an Environmental
Assessment (defined below) made after the date of the Agent's request. As used
in this Agreement, the term "Environmental Assessment" means a report
(including all drafts thereof) of an environmental investigation and analysis
of the subject Collateral Pool Property of such scope (including but not
limited to the taking of soil borings and air and groundwater samples and other
above and below ground testing) as the Agent may request, by a consulting firm
acceptable to Agent and made in accordance with Agent's established guidelines.
The Borrower will cooperate with each consulting firm making any such
Environmental Assessment and will supply to the consulting firm, from time to
time and promptly on request, all information available to the Borrower to
facilitate the completion of the Environmental Assessment. If the Borrower
fails to furnish the Agent within ten (10) days after the Agent's request with
a copy of an agreement with an acceptable environmental consulting firm
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to provide such Environmental Assessment to be made at the Borrower's expense
and risk, the Agent and its designees are hereby granted access to the Hotel
Properties at any time or times, upon reasonable notice (which may be written
or oral), and a license which is coupled with an interest and irrevocable, to
make or cause to be made such Environmental Assessments. The Agent may
disclose to interested parties any information the Agent ever has about the
environmental condition or compliance of the Hotel Property, but shall be under
no duty to disclose any such information except as may be required by law. The
Agent shall be under no duty to make any Environmental Assessment of any of the
Hotel Properties, and in no event shall any such Environmental Assessment by
Agent be or give rise to a representation that any Hazardous Materials is or is
not present on the subject Hotel Property, or that there has been or shall be
compliance with any Environmental Requirement, nor shall the Borrower or any
other person be entitled to rely on any Environmental Assessment made by the
Agent or at the Agent's request. The Agent and the Lenders owe no duty of care
to protect the Borrower or any other person against, or to inform them of, any
Hazardous Material or other adverse condition affecting any of the Collateral
Pool Properties.
7.19.4. Remedial Actions.
(a) If any Hazardous Material is discovered on any of the
Collateral Pool Properties at any time and regardless of the
cause, (i) the Borrower shall promptly at the Borrower's sole
risk and expense remove, treat, and dispose of the Hazardous
Material in compliance with all applicable Environmental
Requirements and solely under the Borrower's name (or if
removal is prohibited by any Environmental Requirement, take
whatever action is required by any Environmental Requirement),
in addition to taking such other action as is necessary to
have the full use and benefit of the subject Collateral Pool
Property as contemplated by the Loan Documents, and provide
the Agent with satisfactory evidence thereof; and (ii) if
requested by the Agent, provide to the Agent within thirty
(30) days of the Agent's request a bond, letter of credit or
other financial assurance evidencing to the Agent's
satisfaction that all necessary funds are readily available to
pay the costs and expenses of the actions required by clause
(i) preceding and to discharge any assessments or liens
established against the subject Collateral Pool Property as a
result of the presence of the Hazardous Material on the
Collateral Pool Property. Within fifteen (15) days after
completion of such remedial actions, Borrower shall obtain and
deliver to the Agent an Environmental Assessment of the Hotel
Property made after such completion and confirming to the
Agent's satisfaction that all required remedial action as
stated above has been taken and successfully completed and
that there is no evidence or suspicion of any contamination or
risk of contamination on the subject Hotel Property or any
adjacent property, or of violation of any Environmental
Requirement, with respect to any such Hazardous Material.
(b) The Agent may, but shall never be obligated to, remove or
cause the removal of any Hazardous Material from any of the
Collateral Pool Properties (or if removal is
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prohibited by any Environmental Requirement, take or cause the
taking of such other action as is required by any
Environmental Requirement) if the Borrower fails to promptly
commence such remedial actions following discovery and
thereafter diligently prosecute the same to the satisfaction
of the Agent (without limitation of the Agent's rights to
declare a default under any of the Loan Documents and to
exercise all rights and remedies available by reason thereof);
and the Agent and its designees are hereby granted access to
the Collateral Pool Properties at any time or times, upon
reasonable notice (which may be written or oral), and a
license which is coupled with an interest and irrevocable, to
remove or cause such removal or to take or cause the taking of
any such other action.
7.19.5. Indemnity.
(a) The Borrower, the Guarantor and their Subsidiaries hereby
agree to protect, indemnify and hold (i) the Agent and the
Lenders; (ii) any persons or entities owned or controlled by,
owning or controlling, or under common control or affiliated
with the Agent or the Lenders; (iii) any participants in the
Facility; (iv) the directors, officers, partners, employees
and agents of the Lenders and/or such persons or entities; and
(v) the heirs, personal representatives, successors and
assigns of each of the foregoing persons or entities (each an
"Indemnified Party") harmless from and against, and, if and to
the extent paid, reimburse them on demand for, any and all
Environmental Damages (as hereinafter defined). Without
limitation, the foregoing indemnity shall apply to each
Indemnified Party with respect to Environmental Damages which
in whole or in part are caused by or arise out of the
negligence of such (and/or any other) Indemnified Party.
However, such indemnity shall not apply to a particular
Indemnified Party to the extent that the subject of the
indemnification is caused by or arises out of the gross
negligence or willful misconduct of that particular
Indemnified Party. Upon demand by the Agent, the Borrower
shall diligently defend any Environmental Claim which affects
any of the Collateral Pool Properties or is made or commenced
against any of the Agent or the Lenders, whether alone or
together with the Borrower or any other person, all at the
Borrower's own cost and expense and by counsel to be approved
by the Agent in the exercise of its reasonable judgment. In
the alternative, at any time the Agent or any Lender may elect
to conduct its own defense through counsel selected by the
Agent or such Lender and at the cost and expense of the
Borrower.
(b) As used in this Agreement, the term "Environmental Damages"
means all claims, demands, liabilities (including strict
liability), losses, damages (including consequential damages),
causes of action, judgments, penalties, fines, costs and
expenses (including fees, costs and expenses of attorneys,
consultants, contractors, experts and laboratories), of any
and every kind or character, contingent or otherwise, matured
or unmatured, known or unknown, foreseeable or unforeseeable,
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made, incurred, suffered, brought, or imposed at any time and
from time to time, whether before or after the Transition Date
(as hereinafter defined) and arising in whole or in part from:
(i) The presence of any Hazardous Material on any of the
Collateral Pool Properties, or any escape, seepage,
leakage, spillage, emission, release, discharge or
disposal of any Hazardous Material on or from any of
the Collateral Pool Properties, or the migration or
release or threatened migration or release of any
Hazardous Material to, from or through any of the
Collateral Pool Properties, on or before the
Transition Date; or
(ii) any act, omission, event or circumstance existing or
occurring in connection with the handling, treatment,
containment, removal, storage, decontamination,
clean-up, transport or disposal of any Hazardous
Material which is at any time on or before the
Transition Date present on any of the Hotel
Properties; or
(iii) the breach of any representation, warranty, covenant
or agreement contained in this Agreement because of
any event or condition occurring or existing on or
before the Transition Date; or
(iv) any violation on or before the Transition Date, of
any Environmental Requirement in effect on or before
the Transition Date, regardless of whether any act,
omission, event or circumstance giving rise to the
violation constituted a violation at the time of the
occurrence or inception of such act, omission, event
or circumstance; or
(v) any Environmental Claim, or the filing or imposition
of any environmental lien against any of the
Collateral Pool Properties, because of, resulting
from, in connection with, or arising out of any of
the matters referred to in subparagraphs (i) through
(iv) preceding; and regardless of whether any of the
foregoing was caused by the Borrower or the Lessee,
or a prior owner of any of the Collateral Pool
Properties or its tenant or subtenant, or any third
party, including but not limited to (a) injury or
damage to any person, property or natural resource
occurring on or off of any of the Collateral Pool
Properties, including but not limited to the cost of
demolition and rebuilding of any improvements on real
property; (b) the investigation or remediation of any
such Hazardous Material or violation of Environmental
Requirement, including but not limited to the
preparation of any feasibility studies or reports and
the performance of any cleanup, remediation, removal,
response, abatement, containment, closure,
restoration, monitoring or similar work required by
any Environmental Requirement or necessary to have
full use and benefit of the subject Collateral Pool
Property as contemplated by the Loan Documents
(including any of the same in connection with any
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foreclosure action or transfer in lieu thereof); (c)
all liability to pay or indemnify any person or
governmental authority for costs expended in
connection with any of the foregoing; (d) the
investigation and defense of any claim, whether or
not such claim is ultimately defeated; and (e) the
settlement of any claim or judgment.
(c) As used in this Agreement, the term "Transition Date" means
the earlier of the following two dates: (i) the date on which
the Obligations have been paid and performed in full and the
Mortgages have been released; or (ii) the date on which the
liens of the Mortgages are fully and finally foreclosed or a
conveyance by deed in lieu of such foreclosure is fully and
finally effective and possession of the Collateral Pool
Properties has been given to and accepted by the purchaser or
grantee free of occupancy and claims to occupancy by the
Borrower and the Borrower's heirs, devisees, representatives,
successors and assigns; provided that, if such payment,
performance, release, foreclosure or conveyance is challenged,
in bankruptcy proceedings or otherwise, the Transition Date
shall be deemed not to have occurred until such challenge is
validly released, dismissed with prejudice or otherwise barred
by law from further assertion.
(d) The indemnification agreements contained in this Section 7.19
are not secured by the Collateral.
7.20. Negative Pledge Agreements. The Borrower, the Guarantor and
their Subsidiaries agree that throughout the Facility, they shall not transfer,
assign, mortgage, hypothecate, grant or agree to a negative pledge or otherwise
encumber any of the Hotel Properties, whether or not such Hotel Properties are
to be included in the Collateral Pool, or any other asset or property of the
Borrower, the Guarantor or their Subsidiaries except to the extent permitted in
Section 7.18(f), in any event subject to the provisions of Section 7.13, if
applicable. The Borrower further agrees to execute Negative Pledge Agreements
for all Hotel Properties in the Negative Collateral Pool, such agreements to be
in recordable form such that they can be recorded by the Agent in the proper
land records office for the state and county where each such Collateral Pool
Property is located. The effectiveness of the Negative Pledge Agreements shall
not in any way be conditioned upon the recordation of such recordable
instruments.
7.21. Manager. The Collateral Pool Properties shall at all times be
managed by RFS, Inc. or another Person approved in writing by the Required
Lenders, it being understood that any other manager identified on Schedule 9 is
acceptable to the Lenders.
7.22. Acceleration Notice. Borrower agrees that it shall, within
ten (10) days after receipt of written notice that any Indebtedness aggregating
$5,000,000 or more of the Borrower, the Guarantor, any Qualified Borrower or
any Subsidiary or Investment Affiliate has been accelerated, provide written
notice to the Agent of such acceleration.
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7.23. Additional Covenants. The Borrower and the Guarantor will not
engage in or willingly permit any illegal activities at any Collateral Pool
Property.
7.24. Calculation of Financial Covenants Upon Property Breaches. In
the event of a breach of a representation or warranty under Article VI or of a
covenant under Sections 7.5, 7.6, 7.7, 7.8, 7.14, 7.19, 7.20, 7.21, or 7.23, or
in the event of the occurrence of any other event which has a Material Adverse
Effect on the operation of any Collateral Pool Property (collectively a
"Property Breach"), or if there are environmental disclosures concerning a
Collateral Pool Property contained in Schedule 4, such Hotel Property shall be
excluded from the Borrowing Base, as well as the calculation of the Borrowing
Base to Value Ratio, and the Borrower shall be required to demonstrate
financial covenant compliance under applicable provisions of Article VII both
with and without the affected Collateral Pool Property for as long as such
breach or condition shall exist. At the Borrower's option, upon written notice
and request to the Agent, the Borrower may substitute another Hotel Property
for the Hotel Property excluded, provided such new Hotel Property is acceptable
to the Lenders and all conditions precedent to the inclusion of such Hotel
Property in the Collateral Pool, as well as the release of a Hotel Property
therefrom, have been complied with. Furthermore, upon such substitution the
Borrower may obtain the release of such Hotel Property excluded from the
Borrowing Base from the lien of any Mortgage or from the restrictions of any
Negative Pledge Agreement only if no Default or Unmatured Default then exists
hereunder and all provisions of Section 7.13 hereof have been complied with.
7.25. Leases. The Borrower will duly perform all obligations as
landlord under the Leases and shall not amend any of the Leases in any material
manner without the Agent's prior written consent, which consent will not be
unreasonably withheld.
7.26. Franchises. The Borrower shall comply, and shall take all
reasonable and necessary steps to ensure that the Lessee complies, with all
requirements of all franchise agreements affecting the use and operation of the
Collateral Pool Properties, and shall promptly notify the Agent within ten (10)
days of the Borrower learning of any default or alleged default under any such
franchise agreement(s), or of any change therein which could have a Material
Adverse Effect.
ARTICLE VIII
DEFAULTS
The occurrence of any one or more of the following events shall
constitute a Default:
8.1. Nonpayment of any principal payment on any Note within five
(5) Business Days of the Borrower's receipt of written notice from the Agent,
provided, however, once such written notice has been given, whether or not such
payment is made, no further written notice will be required in that same
calendar year for any subsequent nonpayment of principal on any Note in order
for such nonpayment to constitute a Default.
8.2. Nonpayment of (a) interest upon any Note, any Commitment Fee,
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Agent's Fee, Facility Letter of Credit Fee, or Unused Credit Fee, under any of
the Loan Documents within five (5) Business Days after the same becomes due or
(b) any other payment Obligation under any of the Loan Documents within five
(5) Business Days of the Borrower's receipt of written notice from the Agent
provided, however, once such written notice has been given, whether or not such
payment is made, no further written notice will be required in that same
calendar year for any subsequent nonpayment of another payment Obligation in
order for such nonpayment under this Section 8.2 (b) to constitute a Default.
8.3. The breach of any of the terms or provisions of Sections
7.1(c), (d) and (e), 7.2(b), 7.6, 7.10, 7.11, 7.12, 7.13, 7.14, 7.16, 7.17,
7.18, 7.19 , 7.20, or 7.21 , or a breach of any of the terms or provisions of
Section 7.1 (other than as set forth above) which remains uncured for ten (10)
Business Days after the Borrower's receipt of written notice from the Agent,
provided, however, in the event such breach of Section 7.18 results from an
adjustment by the Required Lenders in the Applicable Cap Rate, such breach
shall not constitute a Default hereunder if within six (6) months from the date
of such adjustment in the Applicable Cap Rate, the Borrower either reduces the
Allocated Facility Amount to a sum equal to or less than the Borrowing Base (in
which case the Aggregate Commitment Amount of the Facility shall be presumably
reduced unless the Lenders otherwise agree), or provides additional Collateral
satisfactory to the Lenders necessary to restore compliance.
8.4. Any representation or warranty made or deemed made by or on
behalf of the Borrower or any of its Subsidiaries to the Lenders or the Agent
under or in connection with this Agreement (other than Section 6.24 and a
Property Breach unless such breach causes a Default under another provision of
this Article VIII), any Loan, or any certificate or information delivered in
connection with this Agreement or any other Loan Document shall be materially
false on the date as of which made.
8.5. The breach of any of the other terms or provisions of this
Agreement which is not remedied within thirty (30) days, or ninety (90) days
for a breach which is curable but cannot be cured within thirty (30) days but
is being diligently cured, after the receipt of written notice from the Agent.
8.6. Any default by the Borrower, the Guarantor, any Qualified
Borrower or any Investment Affiliate (to the extent the Indebtedness is
recourse to such Person), or any of their Subsidiaries (after applicable cure
periods) under any other loan documents relating to any of such Persons in
connection with any Indebtedness other than the Obligations aggregating in
excess of $50,000,000.
8.7. The Borrower, the Guarantor, any Qualified Borrower or any
Investment Affiliate that is not a Subsidiary (a) have an order for relief
entered with respect to it under the Federal bankruptcy laws as now or
hereafter in effect, (b) make an assignment for the benefit of creditors, (c)
apply for, seek, consent to, or acquiesce in, the appointment of a receiver,
custodian, trustee, examiner, liquidator or similar official for it or any
Substantial Portion of its Property, (d) institute any proceeding seeking an
order for relief under the Federal bankruptcy laws as now or hereafter in
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effect or seeking to adjudicate it as a bankrupt or insolvent, or seeking
dissolution, winding up, liquidation, reorganization, arrangement, adjustment
or composition of it or its debts under any law relating to bankruptcy,
insolvency or reorganization or relief of debtors or fail to file an answer or
other pleading denying the material allegations of any such proceeding filed
against it, (e) take any corporate action to authorize or effect any of the
foregoing actions set forth in this Section 8.7, (f) fail to contest in good
faith any appointment or proceeding described in Section 8.8, or (g) not pay,
or admit in writing its inability to pay, its debts generally as they become
due.
8.8. A receiver, trustee, examiner, liquidator or similar official
shall be appointed for the Borrower, the Guarantor, any Qualified Borrower or
any Investment Affiliate that is not a Subsidiary, or any Subsidiary or any
portion of its property, or a proceeding described in Section 8.7(d) shall be
instituted against any of them and such appointment continues undischarged or
such proceeding continues undismissed or unstayed for a period of sixty (60)
consecutive days.
8.9. Any court, government or governmental agency shall condemn,
seize or otherwise appropriate, or take custody or control of (each a
"Condemnation"), all or any portion of the Hotel Properties of the Borrower,
the Guarantor, any Qualified Borrower or any Investment Affiliates or any
Subsidiaries which, when taken together with all other of their property so
condemned, seized, appropriated, or taken custody or control of, during the
twelve-month period ending with the month in which any such Condemnation
occurs, constitutes a substantial (as determined in the Agent's reasonable
discretion) portion of their property.
8.10. The Borrower, the Guarantor, any Qualified Borrower or
Investment Affiliate or any Subsidiaries shall fail within sixty (60) days to
pay, bond or otherwise discharge any judgments or orders for the payment of
money in an amount which, when added to all other judgments or orders
outstanding against any of them would exceed $10,000,000 in the aggregate,
which have not been stayed on appeal or otherwise appropriately contested in
good faith, unless the liability is insured against and the insurer has not
challenged coverage of such liability.
8.11. The Borrower or any other member of the Controlled Group shall
have been notified by the sponsor of a Multiemployer Plan, the PBGC or other
party that it has incurred withdrawal liability or is in default of payments to
such Multiemployer Plan in an amount which, when aggregated with all other
amounts required to be paid to Multiemployer Plans by the Borrower or any other
member of the Controlled Group as withdrawal liability (determined as of the
date of such notification) or amounts in default, exceeds $250,000 or requires
payments exceeding $100,000 per annum.
8.12. The Borrower or any other member of the Controlled Group shall
have been notified by the sponsor of a Multiemployer Plan or the PBGC or other
party that such Multiemployer Plan is in reorganization or is being terminated,
within the meaning of Title IV of ERISA, if as a result of such reorganization
or termination the aggregate annual contributions of the Borrower and the other
members of the Controlled Group (taken as a whole) to all Multiemployer Plans
which are then in reorganization or being terminated have been or will be
increased over the amounts contributed to such Multiemployer Plans for the
respective plan years
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of each such Multiemployer Plan immediately preceding the plan year in which
the reorganization or termination occurs by an amount exceeding $250,000 per
year.
8.13. (a) A Reportable Event shall occur with respect to a Plan, or
(b) any Plan shall incur an accumulated funding deficiency (as defined in
Section 412 of the Code or Section 302 of ERISA), whether or not waived, or
fail to make a required installment payment on or before the due date under
Section 412 of the Code or Section 302 of ERISA, or (c) the Borrower or a
member of the Controlled Group shall have engaged in a nonexempt prohibited
transaction under Section 4975 of the Code or Section 406 of ERISA, or (d) the
Borrower or any member of the Controlled Group shall fail to pay when due an
amount which it shall have become liable to pay to the PBGC, or any Plan, any
Multiemployer Plan, or (e) Borrower or any member of the Controlled Group shall
have received a notice from the PBGC of its intention to terminate a Plan or to
appoint a trustee to administer a Plan, or Multiemployer Plan, or a condition
exists by reason of which the PBGC would be entitled to obtain a decree
adjudicating that a Plan must be terminated, or (f) any other event or
condition shall occur or exist with respect to any employee benefit plan (as
defined in Section 3(3) of ERISA) or Plan or any Multiemployer Plan, which
could reasonably be expected to subject the Borrower or any member of the
Controlled Group to any tax, penalty or other liability or the imposition of
any lien or security interest on the Borrower or any member of the Controlled
Group, provided, however, that any event or circumstance in Section 8.13(a)
through (f) shall only be an Event of Default if it would result in liability
to Borrower in excess of $250,000 per year; or (g) the assets of the Borrower
or the Guarantor become or are deemed to be assets of an employee benefit plan
(as defined in Section 3(3) of ERISA or a plan as defined in Section 4975 of
the Code). No Default under this Section 8.13 shall be deemed to have been or
be waived or corrected because of any disclosure by the Borrower.
8.14. Failure to remediate within the time period required by law or
governmental order, (or within a reasonable time in light of the nature of the
problem if no specific time period is so established), environmental problems
in violation of applicable law (a) related to Collateral Pool Properties of the
Borrower, the Guarantor, any Qualified Borrower or any Investment Affiliates or
any Subsidiaries if the affected Collateral Pool Properties have an aggregate
book value in excess of $10,000,000 or (b) where the estimated cost of
remediation is in the aggregate in excess of $500,000, in each case after all
administrative hearings and appeals have been concluded.
8.15. The occurrence of any default under any Loan Document other
than this Agreement or the breach of any of the terms or provisions of any Loan
Document other than this Agreement, which default or breach continues beyond
any period of grace therein provided.
8.16. Both ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ and Minor ▇▇▇▇▇▇▇ cease to be active in
the day-to-day management and operation of the Borrower and the Guarantor.
ARTICLE IX
ACCELERATION, WAIVERS, AMENDMENTS AND REMEDIES
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9.1. Acceleration. If any Default described in Sections 8.7 or 8.8
occurs with respect to the Borrower, the Guarantor, any Qualified Borrower or
any Subsidiary or Investment Affiliate, the obligations of the Lenders to make
Loans and of the Issuing Bank to issue Facility Letters of Credit hereunder
shall automatically terminate and the Obligations shall immediately become due
and payable without any election or action on the part of the Agent or any
Lender. If any other Default (other than a Property Breach unless such breach
causes a Default under any other provision of Article VIII) occurs and is
continuing, the Required Lenders may terminate or suspend the obligations of
the Lenders to make Loans hereunder, and to issue Facility Letters of Credit,
or declare the Obligations to be due and payable, or both, whereupon the
Obligations shall become immediately due and payable, upon written notice to
the Borrower.
In addition to the foregoing, following the occurrence and during the
continuance of a Default and so long as any Facility Letter of Credit has not
been fully drawn and has not been canceled or expired by its terms, upon demand
by the Agent the Borrower shall establish and deposit in the Letter of Credit
Collateral Account cash in an amount equal to the aggregate undrawn face amount
of all outstanding Facility Letters of Credit and all fees and other amounts
due or which may become due with respect thereto. The Borrower shall have no
control over funds in the Letter of Credit Collateral Account, which funds will
be invested by the Agent from time to time at its discretion in certificates of
deposit of NationsBank having a maturity not exceeding thirty (30) days. Such
funds shall be promptly applied by the Agent to reimburse any Issuing Bank for
drafts drawn from time to time under the Facility Letters of Credit, provided,
however, interest accrued on such funds shall remain in the Letter of Credit
Collateral Account to be used for reimbursement as set forth above. Such
funds, if any, remaining in the Letter of Credit Collateral Account following
the payment of all Obligations in full shall, unless Agent is otherwise
directed by a court of competent jurisdiction, be promptly paid over to the
Borrower.
If, within forty-five (45) days after acceleration of the maturity of
the Obligations or termination of the obligations of the Lenders to make Loans
hereunder or to issue Facility letters of Credit as a result of any Default
(other than any Default as described in Sections 8.7 or 8.8 with respect to the
Borrower) and before any judgment or decree for the payment of the Obligations
shall have been obtained or entered, the Required Lenders (in their sole
discretion) may direct the Agent by notice to the Borrower, to rescind and
annul such acceleration and/or termination.
9.2. Amendments, Waivers, Decisions. Subject to the provisions of
this Article IX, the Required Lenders (or the Agent with the consent or
direction in writing of the Required Lenders) and the Borrower may waive or
amend any terms or conditions of this Agreement and enter into agreements
supplemental hereto for the purpose of adding or modifying any provisions to
the Loan Documents or changing in any manner the rights of the Lenders or the
Borrower hereunder, releasing any Mortgages or Negative Pledge Agreements
except as provided in Section 7.13 hereof, or waiving any Default hereunder;
provided, however, that no such supplemental agreement shall, without the
consent of all Lenders:
(a) Extend the Facility Termination Date or forgive all or any
portion of the principal amount of any Loan or accrued
interest thereon or the Commitment Fee, or any
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other fees, reduce the applicable margin or spread on the
underlying interest rate options applicable to the various
Types of Advances except as provided in the applicable
interest rate grids based upon the Leverage Ratio, or
otherwise modify or add to such interest rate options, or
extend the time of payment of any of the Obligations.
(b) Reduce the percentage specified in the definition of Required
Lenders or change any provision that currently requires an
approval from the Required Lenders, all Lenders or the
specific Lender affected, to approval by a different standard.
(c) Increase the amount of the Aggregate Commitment.
(d) Permit the Borrower to assign its rights under this Agreement.
(e) Amend Sections 2.2, 2.3, 3.4(a), 3.8(a), 7.4, 7.11, 7.18,
13.2, 13.3 or this Section 9.2.
(f) Release or limit the liability of Borrower, the Guarantor, or
any Qualified Borrower with respect to the Obligations.
(g) Add any Hotel Property to the Collateral Pool.
(h) Amend or modify the definition of, or provisions for the
calculation of, the Borrowing Base.
No amendment of any provision of this Agreement relating to the Agent
shall be effective without the written consent of the Agent, and no amendment
increasing the Commitment of any Lender shall be effective without the written
consent of such Lender.
9.3. Preservation of Rights. No delay or omission of the Lenders
or the Agent to exercise any right under the Loan Documents shall impair such
right or be construed to be a waiver of any Default or an acquiescence therein,
and the making of a Loan notwithstanding the existence of a Default or the
inability of the Borrower to satisfy the conditions precedent to such Loan
shall not constitute any waiver or acquiescence. Any single or partial
exercise of any such right shall not preclude other or further exercise thereof
or the exercise of any other right, and no waiver, amendment or other variation
of the terms, conditions or provisions of the Loan Documents whatsoever shall
be valid unless in writing signed by the Lenders required pursuant to Section
9.2, and then only to the extent in such writing specifically set forth. All
remedies contained in the Loan Documents or by law afforded shall be cumulative
and all shall be available to the Agent and the Lenders until the Obligations
have been paid in full.
ARTICLE X
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GENERAL PROVISIONS
10.1. Survival of Representations. All representations and
warranties of the Borrower contained in this Agreement shall survive delivery
of the Notes and the making of the Loans herein contemplated.
10.2. Governmental Regulation. Anything contained in this Agreement
to the contrary notwithstanding, no Lender shall be obligated to extend credit
to the Borrower in violation of any limitation or prohibition provided by any
applicable statute or regulation.
10.3. Taxes. Any taxes (excluding federal, state and local income
or franchise or other similar taxes on the overall net income of any Lender) or
other similar assessments or charges made by any governmental or revenue
authority in respect of the Loan Documents shall be paid by the Borrower,
together with interest and penalties, if any.
10.4. Headings. Section headings in the Loan Documents are for
convenience of reference only, and shall not govern the interpretation of any
of the provisions of the Loan Documents.
10.5. Entire Agreement. The Loan Documents embody the entire
agreement and understanding among the Borrower, the Guarantor, the Agent, and
the Lenders and supersede all prior commitments, agreements and understandings
among the Borrower, the Guarantor, the Agent, and the Lenders relating to the
subject matter thereof, except for the agreement of the Borrower to pay certain
fees to the Agent and the agreement of the Agent to pay certain fees to the
Lenders.
10.6. Several Obligations; Benefits of This Agreement. The
respective obligations of the Lenders hereunder are several and not joint and
no Lender shall be the partner or agent of any other (except to the extent to
which the Agent is authorized to act as such). The failure of any Lender to
perform any of its obligations hereunder shall not relieve any other Lender
from any of its obligations hereunder. This Agreement shall not be construed
so as to confer any right or benefit upon any Person other than the parties to
this Agreement and their respective successors and assigns.
10.7. Expenses; Indemnification. The Borrower and the Guarantor
shall reimburse upon demand the Arranger, the Agent, and each Lender for any
costs, and reasonable out-of-pocket expenses (including, without limitation,
all reasonable fees for consultants and reasonable fees and expenses for
attorneys for the Arranger, the Agent and each Lender) in connection with the
preparation, negotiation, execution, delivery, amendment or modification of the
Loan Documents, as well as any syndication or assignment of any of their rights
under the Loan Documents as set forth in Section 13.3 hereof. The Borrower and
the Guarantor also agree to reimburse upon demand the Arranger, the Agent, and
the Lenders for any costs, internal charges and reasonable out-of-pocket
expenses (including, without limitation, appraisal expenses and all reasonable
fees and expenses for attorneys for the Arranger, the Agent and the Lenders)
paid or incurred by the
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Arranger or the Agent (whether in its capacity as arranger, or, in the case of
NationsBank, in its capacity as the Agent) or any Lender in connection with the
collection and enforcement of the Loan Documents (including, without
limitation, any workout). The Borrower and the Guarantor further agree to
indemnify and hold harmless the Agent, the Arranger and each Lender and their
directors, officers, employees, agents, attorneys and Affiliates against all
losses, claims, damages, penalties, judgments, liabilities and reasonable
expenses (including, without limitation, all expenses of litigation or
preparation therefor whether or not such entity is a party thereto) which any
of them may pay or incur arising out of or relating to this Agreement, the
other Loan Documents, the Hotel Properties, the transactions contemplated
hereby or the direct or indirect application or proposed application of the
proceeds of any Loan hereunder, other than liability arising from the gross
negligence or willful misconduct of the party being indemnified. The
obligations of the Borrower and the Guarantor under this Section 10.7 shall
survive the Facility Termination Date and continue for the benefit of the
Agent, the Arranger, each Lender, and all of their respective agents,
representatives, employees, officers, directors, and partners at all times
after the Borrower's acceptance of the Commitment (whether or not any expenses
were incurred before or after the execution of the Commitment Letter by the
Borrower) as evidenced by its execution of the Commitment Letter.
10.8. Numbers of Documents. All financial statements, notices,
closing documents, press releases, compliance certificates and requests
hereunder shall be furnished to the Agent with sufficient counterparts so that
the Agent may furnish one to each of the Lenders.
10.9. Accounting. Except as provided to the contrary herein, all
accounting terms used herein shall be interpreted and all accounting
determinations hereunder shall be made in accordance with GAAP, except that any
calculation or determination which is to be made on a consolidated basis shall
be made for the Borrower, the Guarantor and all their Subsidiaries.
10.10. Severability of Provisions. Any provision in any Loan
Document that is held to be inoperative, unenforceable, or invalid in any
jurisdiction shall, as to that jurisdiction, be inoperative, unenforceable, or
invalid without affecting the remaining provisions in that jurisdiction or the
operation, enforceability, or validity of that provision in any other
jurisdiction, and to this end the provisions of all Loan Documents are declared
to be severable.
10.11. Nonliability of Lenders, Arranger, Agent. The relationship
between the Borrower, on the one hand, and the Lenders, the Arranger and the
Agent on the other, shall be solely that of borrower and lender. Neither the
Agent, the Arranger nor any Lender shall have any fiduciary responsibilities to
the Borrower. Neither the Agent, the Arranger nor any Lender undertakes any
responsibility to the Borrower to review or inform the Borrower of any matter
in connection with any phase of the Borrower's business or operations. Neither
the Arranger nor the Agent shall have any responsibilities to the Borrower or
Lenders under this Agreement except to the extent, if any, expressly set forth
herein.
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10.12. Publicity. Each Lender and the Arranger shall have the right
to do a tombstone publicizing the transaction contemplated hereby upon the
consent of the Borrower which shall not be unreasonably withheld.
10.13. Brokers. The Borrower and the Agent each hereby represent and
warrant that no brokers or finders were used in connection with procuring the
financing contemplated hereby and the Borrower hereby agrees to indemnify and
save the Agent and each Lender harmless from and against any and all
liabilities, losses, costs and expenses (including attorneys' fees or court
costs) suffered or incurred by the Agent or any Lender as a result of any claim
or assertion by any party claiming by, through or under the Borrower, the
Guarantor, any Qualified Borrower, any Investment Affiliate or any of their
Subsidiaries that it is entitled to compensation in connection with the
financing contemplated hereby.
10.14. Confidentiality. With respect to the financial statements and
other information delivered pursuant to Section 7.1, and any other information
obtained by any Lender or any assignee of any Lender pursuant to this Section
10.14 or otherwise, each Lender and each assignee of any Lender agree that, to
the extent that such information therein contained has not theretofore
otherwise been disclosed in such a manner as to render such information no
longer confidential, such Lender and such assignee will employ reasonable
procedures reasonably designed to maintain the confidential nature of the
information therein contained; provided that anything herein contained to the
contrary notwithstanding, any Lender or its assignee may disclose or
disseminate such information to: (a) its employees, agents, attorneys
accountants, and the Arranger who would ordinarily have access to such
information in the normal course of the performance of their duties; (b) such
third parties as such Lender may deem reasonably necessary in connection with
or in response to (i) compliance with any law, ordinance or governmental order,
regulation, rule, policy, subpoena, investigation, regulatory authority request
or requests, or (ii) any order, decree, judgment, subpoena, notice of discovery
or similar ruling or pleading issued, filed, served or purported on its face to
be issued, filed or served by or under authority of any court, tribunal,
arbitration board of any governmental or industry agency, commission,
authority, board or similar entity or in connection with any proceeding, case
or matter pending (or on its face purported to be pending) before any court,
tribunal, arbitration board or any governmental agency, commission, authority,
board or similar entity; and (c) any prospective assignee of or Participant in
such Lender's interest, provided such prospective assignee or Participant
agrees in writing to be bound by these provisions.
10.15. Appraisals. Upon any Default or Unmatured Default hereunder,
the Agent may order new or updated appraisals on any Collateral Pool Properties
selected by the Agent. Such appraisals shall be at the Borrower's expense and
the Borrower shall fully cooperate with the Agent to facilitate the preparation
of such appraisals.
10.16. CHOICE OF LAW. THE LOAN DOCUMENTS (OTHER THAN THOSE
CONTAINING A CONTRARY EXPRESS CHOICE OF LAW PROVISION) SHALL BE CONSTRUED IN
ACCORDANCE WITH THE INTERNAL LAWS (AND NOT THE LAW OF
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CONFLICTS) OF THE STATE OF TENNESSEE, BUT GIVING EFFECT TO FEDERAL LAWS
APPLICABLE TO NATIONAL BANKS.
10.17. CONSENT TO JURISDICTION. THE BORROWER HEREBY IRREVOCABLY
SUBMITS TO THE NON-EXCLUSIVE JURISDICTION OF ANY UNITED STATES FEDERAL OR
TENNESSEE STATE COURT SITTING IN MEMPHIS IN ANY ACTION OR PROCEEDING ARISING
OUT OF OR RELATING TO ANY OF THE LOAN DOCUMENTS AND THE BORROWER HEREBY
IRREVOCABLY AGREES THAT ALL CLAIMS IN RESPECT OF SUCH ACTION OR PROCEEDING MAY
BE HEARD AND DETERMINED IN ANY SUCH COURT AND IRREVOCABLY WAIVES ANY OBJECTION
IT MAY NOW OR HEREAFTER HAVE AS TO THE VENUE OF ANY SUCH SUIT, ACTION OR
PROCEEDING BROUGHT IN, SUCH A COURT OR THAT SUCH COURT IS AN INCONVENIENT
FORUM. NOTHING HEREIN SHALL LIMIT THE RIGHT OF THE AGENT OR ANY LENDER TO
BRING PROCEEDINGS AGAINST THE BORROWER IN THE COURTS OF ANY OTHER JURISDICTION.
ANY JUDICIAL PROCEEDING BY THE BORROWER AGAINST THE AGENT OR ANY LENDER OR ANY
AFFILIATE OF THE AGENT OR ANY LENDER INVOLVING, DIRECTLY OR INDIRECTLY, ANY
MATTER IN ANY WAY ARISING OUT OF, RELATED TO, OR CONNECTED WITH ANY LOAN
DOCUMENT SHALL BE BROUGHT ONLY IN A COURT IN MEMPHIS, TENNESSEE.
10.18. WAIVER OF JURY TRIAL. THE BORROWER, THE AGENT AND EACH LENDER
HEREBY WAIVE TRIAL BY JURY IN ANY JUDICIAL PROCEEDING INVOLVING, DIRECTLY OR
INDIRECTLY, ANY MATTER (WHETHER SOUNDING IN TORT, CONTRACT OR OTHERWISE) IN ANY
WAY ARISING OUT OF, RELATED TO, OR CONNECTED WITH ANY LOAN DOCUMENT OR THE
RELATIONSHIP ESTABLISHED THEREUNDER.
10.19. MANDATORY ARBITRATION. ANY CONTROVERSY OR CLAIM BETWEEN OR
AMONG THE PARTIES HERETO INCLUDING BUT NOT LIMITED TO THOSE ARISING OUT OF OR
RELATING TO THIS AGREEMENT OR ANY RELATED AGREEMENTS OR INSTRUMENTS, INCLUDING
ANY CLAIM BASED ON OR ARISING FROM AN ALLEGED TORT, SHALL BE DETERMINED BY
BINDING ARBITRATION IN ACCORDANCE WITH THE FEDERAL ARBITRATION ACT (OR IF NOT
APPLICABLE, THE APPLICABLE STATE LAW), THE RULES OF PRACTICE AND PROCEDURE FOR
THE ARBITRATION OF COMMERCIAL DISPUTES OF ENDISPUTE, INC., DOING BUSINESS AS
J.A.M.S./ENDISPUTE ("J.A.M.S."), AS AMENDED FROM TIME TO TIME, AND THE "SPECIAL
RULES" SET FORTH BELOW. IN THE EVENT OF ANY INCONSISTENCY, THE SPECIAL RULES
SHALL CONTROL. JUDGMENT UPON ANY ARBITRATION AWARD MAY BE ENTERED IN ANY COURT
HAVING JURISDICTION. ANY PARTY TO THIS AGREEMENT MAY BRING AN ACTION,
INCLUDING A SUMMARY OR EXPEDITED PROCEEDING, TO COMPEL ARBITRATION OF ANY
CONTROVERSY OR CLAIM TO WHICH THIS AGREEMENT APPLIES IN ANY COURT HAVING
JURISDICTION OVER SUCH ACTION.
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(a) SPECIAL RULES. THE ARBITRATION SHALL BE CONDUCTED IN THE CITY
OF ATLANTA, GEORGIA AND ADMINISTERED BY J.A.M.S. WHO WILL
APPOINT AN ARBITRATOR; IF J.A.M.S. IS UNABLE OR LEGALLY
PRECLUDED FROM ADMINISTERING THE ARBITRATION, THEN THE
AMERICAN ARBITRATION ASSOCIATION WILL SERVE. ALL ARBITRATION
HEARINGS WILL BE COMMENCED WITHIN NINETY (90) DAYS OF THE
DEMAND FOR ARBITRATION; FURTHER, THE ARBITRATOR SHALL ONLY,
UPON A SHOWING OF CAUSE, BE PERMITTED TO EXTEND THE
COMMENCEMENT OF SUCH HEARING FOR UP TO AN ADDITIONAL SIXTY
(60) DAYS.
(b) RESERVATIONS OF RIGHTS. NOTHING IN THIS AGREEMENT SHALL BE
DEEMED TO (i) LIMIT THE APPLICABILITY OF ANY OTHERWISE
APPLICABLE STATUTES OF LIMITATION OR RESPONSE AND ANY WAIVERS
CONTAINED IN THIS AGREEMENT; OR (ii) BE A WAIVER BY THE
LENDERS OF THE PROTECTION AFFORDED TO THEM BY 12 U.S.C. SEC.
91 OR ANY SUBSTANTIALLY EQUIVALENT STATE LAW; OR (iii) LIMIT
THE RIGHT OF ANY LENDER (A) TO EXERCISE SELF HELP REMEDIES
SUCH AS (BUT NOT LIMITED TO) SETOFF, OR (B) TO FORECLOSE
AGAINST ANY REAL OR PERSONAL PROPERTY COLLATERAL, OR (C) TO
OBTAIN FROM A COURT PROVISIONAL OR ANCILLARY REMEDIES SUCH AS
(BUT NOT LIMITED TO) INJUNCTIVE RELIEF OR THE APPOINTMENT OF A
RECEIVER. THE LENDERS MAY EXERCISE SUCH SELF HELP RIGHTS,
FORECLOSE UPON SUCH PROPERTY, OR OBTAIN SUCH PROVISIONAL OR
ANCILLARY REMEDIES BEFORE, DURING OR AFTER THE PENDENCY OF ANY
ARBITRATION PROCEEDING BROUGHT PURSUANT TO THIS AGREEMENT. AT
THE LENDER'S OPTION, FORECLOSURE UNDER A MORTGAGE MAY BE
ACCOMPLISHED BY ANY OF THE FOLLOWING: THE EXERCISE OF A POWER
OF SALE UNDER THE MORTGAGE, OR BY JUDICIAL SALE UNDER THE
MORTGAGE, OR BY JUDICIAL FORECLOSURE. NEITHER THE EXERCISE OF
SELF HELP REMEDIES NOR THE INSTITUTION OR MAINTENANCE OF AN
ACTION FOR FORECLOSURE OR PROVISIONAL OR ANCILLARY REMEDIES
SHALL CONSTITUTE A WAIVER OF THE RIGHT OF ANY PARTY, INCLUDING
THE CLAIMANT IN ANY SUCH ACTION, TO ARBITRATE THE MERITS OF
THE CONTROVERSY OR CLAIM OCCASIONING RESORT TO SUCH REMEDIES.
NO PROVISION IN THE LOAN DOCUMENTS REGARDING SUBMISSION TO
JURISDICTION AND/OR VENUE IN ANY COURT IS INTENDED OR SHALL BE CONSTRUED TO BE
IN DEROGATION OF THE PROVISIONS IN ANY LOAN DOCUMENT FOR ARBITRATION OF ANY
CONTROVERSY OR CLAIM.
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ARTICLE XI
THE AGENT AND AGREEMENTS AMONG LENDERS
11.1. Appointment. Subject to the provisions of Section 11.11,
NationsBank is hereby appointed as the Agent hereunder and under each other
Loan Document, and each of the Lenders irrevocably authorizes the Agent to act
as the agent of such Lender. The Agent agrees to act as such upon the express
conditions contained in this Article XI. The Agent shall not have a fiduciary
relationship in respect of the Borrower or any Lender by reason of this
Agreement. The Agent agrees to administer this Facility in the same manner as
it administers similar facilities for its own account.
11.2. Powers. The Agent shall have and may exercise such powers
under the Loan Documents as are specifically delegated to the Agent by the
terms of each thereof, together with such powers as are reasonably incidental
thereto. The Agent shall have no implied duties to the Lenders, or any
obligation to the Lenders to take any action thereunder except any action
specifically provided by the Loan Documents to be taken by the Agent.
11.3. General Immunity. Neither the Agent nor any of its directors,
officers, agents or employees shall be liable to the Borrower, the Lenders or
any Lender for any action taken or omitted to be taken by it or them hereunder
or under any other Loan Document or in connection herewith or therewith except
for its or their own gross negligence or willful misconduct and except for any
liability of the Agent for breach of an express agreement made by the Agent
herein to take or not take actions based on the approval or direction of a
requisite number of Lenders.
11.4. No Responsibility for Loans, Recitals, etc. Neither the Agent
nor any of its directors, officers, agents, employees, attorneys-in-fact or
Affiliates shall be responsible for or have any duty to ascertain, inquire
into, or verify (a) any statement, warranty or representation made in
connection with any Loan Document or any borrowing hereunder; (b) the
performance or observance of any of the covenants or agreements of any obligor
under any Loan Document, including, without limitation, any agreement by an
obligor to furnish information directly to each Lender; (c) the satisfaction of
any condition specified in Article V, except receipt of items required to be
delivered to the Agent; (d) the validity, effectiveness, enforceability,
collectibility, sufficiency or genuineness of any Loan Document or any other
instrument or writing furnished in connection therewith (provided that the
Agent shall be obligated to furnish copies of the Loan Documents to the
Lenders); or (e) the value, sufficiency, creation, perfection or priority of
any interest in any collateral security. The Agent shall have no duty to
disclose to the Lenders information that is not required to be furnished by the
Borrower to the Agent at such time, but is voluntarily furnished by the
Borrower to the Agent in its individual capacity.
11.5. Action on Instructions of Lenders. The Agent shall in all
cases be fully protected in acting, or in refraining from acting, hereunder and
under any other Loan Document in accordance with written instructions signed by
the Required Lenders unless such action or inaction requires the
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consent of all the Lenders or an individual Lender not included in the
direction of the Required Lenders pursuant to this Agreement, and such
instructions and any action taken or failure to act pursuant thereto shall be
binding on all of the Lenders and on all holders of Notes. The Agent shall be
fully justified in failing or refusing to take any action hereunder and under
any other Loan Document unless it shall first be indemnified to its
satisfaction by the Lenders pro rata against any and all liability, cost and
expense that it may incur by reason of taking or continuing to take any such
action.
11.6. Employment of Agents and Counsel. The Agent may execute any
of its duties as the Agent hereunder and under any other Loan Document by or
through employees, agents, attorneys and attorneys-in-fact and so long as it
exercises reasonable care in the selection of such parties, the Agent shall not
be answerable to the Lenders, except as to money or securities received by it
or its authorized agents, due solely to the default, negligence or misconduct
of any such parties. The Agent shall be entitled to advice of counsel
concerning all matters pertaining to the agency hereby created and its duties
hereunder and under any other Loan Document.
11.7 Reliance on Documents, Counsel. The Agent shall be entitled
to rely upon any Note, notice, consent, certificate, affidavit, letter,
telegram, statement, paper or document believed by it to be genuine and correct
and to have been signed or sent by the proper person or persons, and, in
respect to legal matters, upon the opinion of counsel selected by the Agent,
which counsel may be employees of the Agent.
11.8. Agent's Reimbursement and Indemnification. The Lenders agree
to reimburse and indemnify the Agent (in its capacity as Agent but not as
Lender) ratably in proportion to their respective Commitments (i) for any
amounts not reimbursed by the Borrower for which the Agent is entitled to
reimbursement by the Borrower under the Loan Documents including reasonable
out-of pocket expenses in connection with the preparation, execution and
delivery of the Loan Documents, (ii) for any other reasonable out-of-pocket
expenses incurred by the Agent on behalf of the Lenders, in connection with the
administration and enforcement of the Loan Documents and (iii) for any
liabilities, obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses or disbursements of any kind and nature whatsoever which
may be imposed on, incurred by or asserted against the Agent in any way
relating to or arising out of the Loan Documents or any other document
delivered in connection therewith or the transactions contemplated thereby, or
the enforcement of any of the terms thereof or of any such other documents,
provided that no Lender shall be liable for any of the foregoing to the extent
they arise from the gross negligence or willful misconduct of the Agent or an
action relating to a dispute which is solely between the Agent and one or more
Lenders in which the other Lender prevails, or an action taken or not taken by
Agent contrary to the express requirements contained herein pertaining to the
requisite number of lenders required to approve or direct certain actions. The
obligations of the Lenders under this Section 11.8 shall survive payment of the
Obligations and termination of this Agreement.
11.9. Rights as a Lender. In the event the Agent is a Lender, the
Agent shall have the same rights and powers and the same duties and obligations
hereunder and under any other Loan Document as any Lender and may exercise the
same as though it were not the Agent, and the term
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"Lender" or "Lenders" shall, at any time when the Agent is a Lender, unless the
context otherwise indicates, include the Agent in its individual capacity. The
Agent may accept deposits from, lend money to, and generally engage in any kind
of trust, debt, equity or other transaction, in addition to those contemplated
by this Agreement or any other Loan Document, with the Borrower, the Guarantor
or any of their Subsidiaries in which the Borrower, the Guarantor or such
Subsidiary is not restricted hereby from engaging with any other Person.
11.10. Lender Credit Decision; Non-Reliance on Agents and Other
Lenders. Each Lender expressly acknowledges that neither the Agent, NMSI, nor
any of their officers, directors, employees, agents, attorneys,
attorneys-in-fact or Affiliates has made any representations or warranties to it
and that no act by the Agent, NMSI or any Affiliate thereof hereinafter taken,
including any review of the affairs of the Borrower, the Guarantor, any
Qualified Borrower, Investment Affiliate, or Subsidiary, shall be deemed to
constitute any representation or warranty by the Agent or NMSI to any Lender.
Each Lender represents to the Agent and NMSI that it has, independently and
without reliance upon the Agent or NMSI or any other Lender, or any of their
respective officers, directors, employees, agents, attorneys, attorneys-in-fact,
or Affiliates, and based on such documents and information as it has deemed
appropriate made its own credit analysis, appraisal of and investigation into
the business, assets, operations, property, financial and other conditions,
prospects and credit worthiness of the Borrower, the Guarantor, any Qualified
Borrower, Investment Affiliate, or Subsidiary and made its own decision to make
its loans hereunder and enter into this Agreement. Each Lender also represents
that it will, independently and without reliance upon the Agent, NMSI or any
other lender or any of their respective officers, directors, employees, agents,
attorneys, attorneys-in-fact or Affiliates, and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit analysis, appraisals, and decisions in taking or not taking action under
this Agreement, and to make such investigation as it deems necessary to inform
itself as to the business, assets, operations, property, financial and other
conditions, prospects and creditworthiness of the Borrower, the Guarantor, any
Qualified Borrower, Investment Affiliate, or Subsidiary. The Agent shall
promptly provide to the Lenders copies of all notices of Default, copies of all
financial statements, certificates and other information pursuant to Section
11.14. Except for such notices, reports and other documents expressly required
to be furnished to the Lenders by the Agent hereunder, the Agent and NMSI shall
not have any duty or responsibility to provide any Lender with any credit or
other information concerning the business, operations, assets, property,
financial or other conditions, prospects or creditworthiness of the Borrower,
the Guarantor, any Qualified Borrower, Investment Affiliate or Subsidiary, which
may come into the possession of the Agent, NMSI or any of their officers,
directors, employees, agents, attorneys, attorneys-in-fact or Affiliates.
11.11. Resignation of Agent; Removal of Agent; Successor Agent.
(a) Resignation of Agent. The Agent may resign at any time by
giving prior written notice thereof to the Lenders and the
Borrower. Upon any such resignation, the Required Lenders
shall have the right to appoint a successor Agent. If no
successor Agent shall have been so appointed by the Required
Lenders and shall have
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accepted such appointment within thirty (30) days after the
retiring Agent's giving notice of resignation, then the
retiring Agent may, on behalf of the Lenders, appoint a
successor Agent. Any such successor Agent shall be either a
Lender or a commercial bank organized under the laws of the
United States of America or any state thereof and have total
assets of at least $25,000,000,000 (as shown on its most
recently published statement of condition) and whose debt
obligations (or whose parent's debt obligations) are rated not
less than Baa1 by ▇▇▇▇▇'▇ or BBB+ by Standard & Poor's, and is
generally in the business of making loans comparable to the
Loans made under this Facility. If the successor Agent is a
subsidiary of a bank, total assets and rating requirement
shall apply only to the parent bank. In the event that the
retiring Agent, after becoming entitled to appoint a successor
Agent as set forth above, does not appoint a successor agent
within sixty (60) days after the retiring Agent giving notice
of resignation, the Lenders shall perform all the duties of
the Agent hereunder and the Borrower shall make all payments
in respect of the Obligations to the applicable Lender and for
all other purposes shall deal directly with the Lenders. No
successor Agent shall be deemed to be appointed hereunder
until such successor Agent has accepted the appointment.
(b) Removal of Agent. The Lenders may remove the Agent as the
Agent hereunder and appoint a successor Agent upon not less
than thirty (30) days' prior written notice signed by Lenders
whose Commitment Percentages equal 66 2/3% of the Aggregate
Commitment exclusive of the Agent's Commitment, if (i) the
Agent's Commitment (if the Agent is also a Lender) is less
than $15,000,000 and no Event of Default has occurred and is
continuing, or (ii) the Agent is grossly negligent or is
guilty of willful misconduct in the performance of its duties
hereunder, as determined in the reasonable discretion of the
Lenders signing the foregoing written notice.
(c) Successor Agents. Upon the acceptance of any appointment as
Agent under this Agreement by a successor Agent, such
successor Agent shall thereupon succeed to and become vested
with all the rights, powers, discretion, privileges, and
duties of the retiring Agent upon written notice thereof to
the Borrower, and the retiring Agent shall be discharged from
its duties and obligations under this Agreement excepting with
respect to its willful misconduct or gross negligence
occurring prior to its discharge. After any retiring Agent's
resignation or removal under this Agreement as Agent, the
provisions of this Article 11 shall continue in effect for its
benefit in respect of any actions taken or omitted to be taken
by it while it was acting as the Agent.
11.12. Notice of Defaults. The Agent shall not be deemed to have
knowledge or notice of the occurrence of any Default or Unmatured Default
hereunder (other than a Default resulting from the nonpayment of any principal,
interest or fees due hereunder) unless the Agent has received notice from a
Lender or another Person referring to a Loan Document describing such Default or
Unmatured Default and stating that such notice is a "notice of default." In the
event the Agent receives such a notice, the Agent shall give notice thereof to
the Lenders within one (1) Business
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Day of the Agent's receipt thereof. The Agent shall take such action with
respect to such Default or Unmatured Default as shall be reasonably directed by
the Required Lenders. Each Lender shall give the Agent written notice of any
Default or Unmatured Default within one (1) Business Day of such Lender's
knowledge of a Default or Unmatured Default.
11.13. Requests for Approval. If the Agent requests in writing the
consent or approval of a Lender, unless otherwise provided herein or in any
other Loan Document, such Lender shall respond and either approve or disapprove
definitively in writing to the Agent within ten (10) Business Days (or sooner if
such notice specifies a shorter period, but in no event less than five (5)
Business Days for responses based on the Agent's good faith determination that
circumstances exist warranting its request for an earlier response) after such
written request from the Agent, and within fifteen (15) Business Days of the
written request from the Agent and the receipt of all documents and information
required by Sections 5.3 and 5.4, as applicable, when considering new Hotel
Properties for inclusion in the Collateral Pool. If the Lender does not so
respond, that Lender shall be deemed to have approved the request. Upon request,
the Agent shall notify the Lenders which Lenders, if any, failed to respond to a
request for approval.
11.14. Copies of Documents. The Agent shall promptly deliver to each
of the Lenders copies of all notices of Default and other formal notices sent or
received and according to Section 14 of this agreement. The Agent shall deliver
to Lenders within fifteen (15) Business Days following receipt, copies of all
financial statements and certificates except to the extent such items are
required to be furnished directly to the Lenders by the Borrower hereunder.
Within fifteen (15) Business Days after a request by a Lender to the Agent for
other documents previously furnished to the Agent by the Borrower, the Agent
shall provide copies of such documents to such Lender except where this
Agreement obligates the Agent to provide copies in a shorter period of time.
11.15. Defaulting Lenders. At such time as a Lender becomes a
Defaulting Lender, such Defaulting Lender's right to vote on matters which are
subject to the consent or approval of the Required Lenders, each affected Lender
or all Lenders shall be immediately suspended until such time as the Lender is
no longer a Defaulting Lender. If a Defaulting Lender has failed to fund its
Percentage of any Advance and until such time as such Defaulting Lender
subsequently funds its Percentage of such Advance, all Obligations owing to such
Defaulting Lender hereunder shall be subordinated in right of payment, as
provided in the following sentence, to the prior payment in full of all
principal of, interest on and fees relating to the Loans funded by the other
Lenders in connection with any such Advance in which the Defaulting Lender has
not funded its Percentage (such principal, interest and fees being referred to
as "Senior Loans" for the purposes of this section). All amounts paid by the
Borrower and otherwise due to be applied to the Obligations owing to such
Defaulting Lender pursuant to the terms hereof shall be distributed by the Agent
to the other Lenders in accordance with their respective Percentages
(recalculated for the purposes hereof to exclude the Defaulting Lender) until
all Senior Loans have been paid in full. At that point, the "Defaulting Lender"
shall no longer be deemed a Defaulting Lender. After the Senior Loans have been
paid in full equitable adjustments will be made in connection with future
payments by the Borrower to the extent a portion of the Senior Loans had been
repaid with amounts that otherwise would have been distributed to a Defaulting
Lender but for the operation of
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this Section 11.15. This provision governs only the relationship among the
Agent, each Defaulting Lender and the other Lenders; nothing hereunder shall
limit the obligation of the Borrower to repay all Loans in accordance with the
terms of this Agreement. The provisions of this section shall apply and be
effective regardless of whether a Default occurs and is continuing, and
notwithstanding (i) any other provision of this Agreement to the contrary, (ii)
any instruction of the Borrower as to its desired application of payments or
(iii) the suspension of such Defaulting Lender's right to vote on matters which
are subject to the consent or approval of the Required Lenders or all Lenders.
ARTICLE XII
RATABLE PAYMENTS
If any Lender has payment made to it upon its Loans (other than
payments received pursuant to Sections 4.1, 4.2 or 4.4) in a greater proportion
than that received by any other Lender, such Lender agrees, promptly upon
demand, to purchase a portion of the Loans held by the other Lenders so that
after such purchase each Lender will hold its ratable proportion of Loans. If
any Lender, whether in connection with setoff or amounts which might be subject
to setoff or otherwise, receives collateral or other protection for its
Obligations or such amounts which may be subject to setoff, such Lender agrees,
promptly upon demand, to take such action necessary such that all Lenders share
in the benefits of such collateral ratably in proportion to their Loans. In case
any such payment is disturbed by legal process, or otherwise, appropriate
further adjustments shall be made.
ARTICLE XIII
BENEFIT OF AGREEMENT; PARTICIPATIONS; ASSIGNMENTS
13.1. Successors and Assigns. The terms and provisions of the Loan
Documents shall be binding upon and inure to the benefit of the Borrower, the
Guarantor and the Lenders and their successors and permitted assigns, except
that (i) the Borrower and the Guarantor shall not have the right to assign their
rights or obligations under the Loan Documents and (ii) any assignment by any
Lender must be made in compliance with Section 13.3. Notwithstanding clause (ii)
of this Section 13.1, any Lender may at any time, without the consent of the
Borrower, assign all or any portion of its rights under this Agreement and its
Notes to a Federal Reserve Bank or to an Affiliate; provided, however, that no
such assignment shall release the transferor Lender from its obligations
hereunder. The Agent may treat the payee of any Note as the owner thereof for
all purposes hereof unless and until such payee complies with Section 13.3 in
the case of an assignment thereof or, in the case of any other transfer, a
written notice of the transfer is filed with the Agent. Any assignee or
transferee of a Note agrees by acceptance thereof to be bound by all the terms
and provisions of the Loan Documents. Any request, authority or consent of any
Person, who at the time of making
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such request or giving such authority or consent is the holder of any Note,
shall be conclusive and binding on any subsequent holder, transferee or assignee
of such Note or of any Note or Notes issued in exchange therefor.
13.2 Participations.
13.2.1. Permitted Participants; Effect. Any Lender, in the ordinary
course of its business and in accordance with applicable law, at any time, may
sell participating interests in any Loan owing to such Lender, any Note held by
such Lender, any Commitment of such Lender or any other interest of such under
the Loan Documents. Any Person to whom such a participating interest is sold is
a "Participant." In the event of any such sale by a Lender of participating
interests to a Participant, such Lender's obligations under the Loan Documents
shall remain unchanged, such Lender shall remain solely responsible to the other
parties hereto for the performance of such obligations, such Lender shall remain
the holder of any such Note for all purposes under the Loan Documents, all
amounts payable by the Borrower under this Agreement shall be determined as if
such Lender had not sold such participating interests, and the Borrower and the
Agent shall continue to deal solely and directly with such Lender in connection
with such Lender's rights and obligations under the Loan Documents.
13.2.2. Voting Rights. Each Lender shall retain the sole right to
approve, without the consent of any Participant, any amendment, modification or
waiver of any provision of the Loan Documents other than any amendment,
modification or waiver with respect to any Loan or Commitment in which such
Participant has an interest which forgives principal, interest or fees or
reduces the interest rate or fees payable with respect to any such Loan or
Commitment or postpones any date fixed for any regularly-scheduled payment of
principal of, or interest or fees on, any such Loan or Commitment or releases
any guarantor of any such Loan or releases any substantial portion of
collateral, if any, securing such Loan.
13.3. Assignments.
13.3.1. Permitted Assignments. In addition to the assignments
permitted in Section 13.1 hereof, any Lender may, in the ordinary course of its
business, with the prior written consent of the Agent, which consent shall not
be unreasonably withheld, and in accordance with applicable law, at any time,
assign all or any portion of its rights and obligations under the Loan Documents
pursuant to an assignment agreement substantially in the form of Exhibit D, to
one or more Eligible Assignees, provided that (a) any such assignment shall be
in a minimum aggregate amount of $10,000,000 of such Lender's Commitment, and in
integral multiples of $1,000,000 above such amount (or the remaining amount of
the Commitment held by such Lender), (b) each such assignment shall be of a
constant, not varying, percentage of all of the assigning Lender's rights and
obligations under the Commitment being assigned, and (c) any Lender wishing to
assign all or a portion of its Commitment who has received a bonafide offer to
purchase all or a portion of its Commitment must first offer to assign such
Commitment, or portion thereof, for the same sum as set forth in said offer, by
written notice to all other Lenders, followed by ten (10) Business Days during
which time any other Lender may by written notice to the assigning Lender as
well as the
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Agent exercise its right of first refusal to purchase such Commitment, or
portion thereof. In the event more than one (1) Lender exercises such right, the
amount of the Commitment to be assigned shall be divided equally among such
Lenders, with the payment of funds due from each such purchasing Lender to be
made within five (5) Business Days of the date of such written notice from the
end of the ten (10) day right of first refusal period. Any Lender considering an
assignment of all or a portion of its Commitment is hereby authorized to
disseminate any information it now has or hereafter obtains pertaining to the
Facility, including, without limitation, any of the Loan Documents and any
credit or other information on the Borrower and the Guarantor, and any
Subsidiaries, Qualified Borrowers or Investment Affiliates, to any such
assignee, or prospective assignee, affiliates of the Agent or the Lenders,
including, without limitation, NMSI, any regulatory body having jurisdiction
over the Agent or the Lenders, and to any other Persons as necessary or
appropriate in the Agent's or the Lenders' reasonable judgment. Unless such
Lender assigns its entire interest, it must maintain a minimum Commitment of
$10,000,000 (exclusive of any portion of its Commitment in which it has sold a
participation interest, other than participations where such Lender retains full
voting control). Notwithstanding the foregoing provision, any assignment by a
Lender to another Lender, or an Affiliate thereof, or an Affiliate of the
assigning Lender shall not be subject to either the $10,000,000 minimum
assignment amount or the fee in Section 13.3.2(b) hereof. If the Aggregate
Commitment is reduced, the references to $10,000,000 contained in this Section
13.3.1 shall be reduced proportionately. Any Person to whom such rights and
obligations are assigned is a "Purchaser." Such assignment shall be
substantially in the form of Exhibit D hereto or in such other form as may be
agreed to by the parties thereto (the "Assignment"). So long as no Default or
Unmatured Default exists hereunder, in no event shall NationsBank's Commitment
amount be reduced below the largest Commitment amount for any of the other
Lenders.
13.3.2. Effect; Effective Date. Upon (a) delivery to the Agent and the
Borrower of a notice of assignment, substantially in the form attached as
Exhibit I to Exhibit D hereto (a "Notice of Assignment"), together with any
consents required by Section 13.3.1, and (b) payment of a $3,500 fee to the
Agent for processing such assignment, such assignment shall become effective on
the effective date specified in such Notice of Assignment. The Notice of
Assignment shall contain a representation by the Purchaser to the effect that
none of the consideration used to make the purchase of the Commitment and Loans
under the applicable assignment agreement are "plan assets" as defined under
ERISA and that the rights and interests of the Purchaser in and under the Loan
Documents will not be "plan assets" under ERISA. On and after the effective date
of such assignment, such Purchaser shall for all purposes be a Lender party to
this Agreement and any other Loan Document executed by the Lenders and shall
have all the rights and obligations of a Lender under the Loan Documents, to the
same extent as if it were an original party hereto, and no further consent or
action by the Borrower, the Lenders or the Agent shall be required to release
NationsBank with respect to the percentage of the Aggregate Commitment and Loans
assigned to such Purchaser. Upon the consummation of any assignment to a
Purchaser pursuant to this Section 13.3.2, the transferor Lender, Agent and the
Borrower shall make appropriate arrangements so that replacement Notes are
issued to such transferor Lender, if applicable, and new Notes or, as
appropriate, replacement Notes, are issued to such Purchaser, in each case in
principal amounts reflecting their Commitment, as adjusted pursuant to such
assignment.
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13.4. Dissemination of Information. The Borrower and the Guarantor
authorize each Lender to disclose to the Arranger and to any Participant or
Purchaser, or any other Person acquiring an interest in the Loan Documents by
operation of law (each a "Transferee") and any prospective Transferee any and
all information in such Lender's possession concerning the creditworthiness of
the Borrower, the Guarantor and their Subsidiaries, provided that such
Transferees agree to maintain the confidentiality of any information that is
confidential in the manner set forth in Section 10.14.
13.5. Tax Treatment. If any interest in any Loan Document is
transferred to any Transferee which is organized under the laws of any
jurisdiction other than the United States or any State thereof, the transferor
Lender shall cause such Transferee, concurrently with the effectiveness of such
transfer, to comply with the provisions of Section 2.19.
13.6. Possession of Loan Documents and Register. The Agent shall keep
and maintain complete and accurate files and records of all matters pertaining
to the Loan. Upon reasonable prior notice to the Agent by any Lender, other than
any privileged attorney/client information or documentation or other internal
information or documentation deemed by the Agent to be privileged or proprietary
in nature, the Agent will make available to such Lender and their
representatives and agents, the files and records relating to the Facility for
inspection and copying at their expense during normal business hours. The Agent
shall also maintain at its address specified pursuant to Article XIV, a copy of
each Assignment delivered to and accepted by it and a listing of the names and
addresses of the Lenders, the amount of each Lender's Commitment and Percentage
(the "Register"). The entries in the Register shall be conclusive and binding
for all purposes, absent manifest error, and the Borrower, the Agent, and the
Lenders may treat each person or entity whose name is recorded in the Register
as a Lender hereunder for all purposes of this Agreement. The Register shall be
available for inspection and copying by the Borrower or any Lender during normal
business hours upon reasonable prior notice to the Agent.
ARTICLE XIV
NOTICES
14.1. Giving Notice. Except as otherwise permitted by Section 2.14 with
respect to borrowing notices, all notices and other communications provided to
any party hereto under this Agreement or any other Loan Document shall be in
writing or by telex or by facsimile and addressed or delivered to such party at
its address set forth below its signature hereto or at such other address as may
be designated by such party in a notice to the other parties. Any notice, if
mailed and properly addressed with postage prepaid, shall be deemed given when
received; any notice, if transmitted by telex or facsimile, shall be deemed
given when transmitted (answer back confirmed in the case of telexes).
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14.2. Change of Address. The Borrower, the Guarantor, the Agent and any
Lender may each change the address for service of notice upon it by a notice in
writing to the other parties hereto.
14.3. Accounts. The Agent shall deliver to each Lender and the
Borrower, and each Lender shall deliver to the Agent wiring instructions
containing account information for purposes of the payment of sums due under
this Agreement.
ARTICLE XV
COUNTERPARTS
This Agreement may be executed in any number of counterparts, all of
which taken together shall constitute one agreement, and any of the parties
hereto may execute this Agreement by signing any such counterpart. This
Agreement shall be effective when it has been executed by the Borrower, the
Guarantor, the Agent and the Lenders and each party has notified the Agent by
telex or telephone, that it has taken such action.
IN WITNESS WHEREOF, the Borrower, the Guarantor the Lenders and the
Agent have executed this Agreement as of the date first above written.
The "Borrower"
RFS PARTNERSHIP, L.P.
By: RFS Hotel Investors, Inc.
Its General Partner
By:________________________________
Name: _____________________________
Title:_____________________________
Notice Address:
▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇., ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇▇
Telephone: 901/▇▇▇-▇▇▇▇
Facsimile: 901/818-5260
The "Guarantor"
RFS HOTEL INVESTORS, INC.
By:________________________________
Name:______________________________
Title:_____________________________
Notice Address:
▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇., ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇▇
Telephone: 901/▇▇▇-▇▇▇▇
Facsimile: 901/818-5260
The "Guarantor"
RFS HOTEL INVESTORS, INC.
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By: ______________________________________
Name: __________________________________
Title: __________________________________
Notice Address:
▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇., ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇▇
Telephone: 901/▇▇▇-▇▇▇▇
Facsimile: 901/818-5260
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COMMITMENT:
$25,000,000 NATIONSBANK, N.A.
Individually and as Agent
PERCENTAGE:
14.2857% By:___________________________________________
Name:_________________________________________
Title:________________________________________
Notice Address:
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇., ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: Real Estate Loan Administration
Telephone: 404/▇▇▇-▇▇▇▇
Facsimile: 404/607-4145
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COMMITMENT:
$25,000,000 SOUTHTRUST BANK OF GEORGIA, N.A.
PERCENTAGE:
14.2857% By: ______________________________________
Name: __________________________________
Title: __________________________________
Notice Address:
▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ ▇▇., ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Telephone: 404/▇▇▇-▇▇▇▇
Facsimile: 404/853-5766
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COMMITMENT:
$25,000.000 FIRST TENNESSEE BANK NATIONAL
ASSOCIATION
PERCENTAGE:
14.2857% By: ______________________________________
Name: __________________________________
Title: __________________________________
Notice Address:
First Tennessee Bank National Association
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Telephone: 901/▇▇▇-▇▇▇▇
Facsimile: 901/523-4235
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COMMITMENT:
$25,000,000 PNC BANK, KENTUCKY, INC.
PERCENTAGE:
14.2857% By: ______________________________________
Name: __________________________________
Title: __________________________________
Notice Address:
Commercial Real Estate
▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Telephone: 513/▇▇▇-▇▇▇▇
Facsimile: 513/651-8931
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COMMITMENT:
$20,000,000 ▇▇▇▇▇ FARGO BANK
PERCENTAGE:
11.4286% By: ______________________________________
Name: __________________________________
Title: __________________________________
Notice Address:
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇.
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇ ▇▇▇▇▇▇▇
Telephone: 770/▇▇▇-▇▇▇▇
Facsimile: 770/435-2262
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COMMITMENT:
$20,000,000 SOCIETE GENERALE, SOUTHWEST AGENCY
PERCENTAGE:
11.4286% By: ______________________________________
Name: __________________________________
Title: __________________________________
Notice Address:
▇▇▇▇ ▇▇▇▇ ▇▇▇.
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇
Telephone: 214/▇▇▇-▇▇▇▇
Facsimile: 214/979-2727
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107
COMMITMENT:
$20,000,000 AMSOUTH BANK OF ALABAMA
PERCENTAGE:
11.4286% By: ______________________________________
Name: __________________________________
Title: __________________________________
Notice Address:
▇▇▇▇ ▇▇▇ ▇▇▇. ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telephone: 205/▇▇▇-▇▇▇▇
Facsimile: 205/326-4075
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108
COMMITMENT:
$15,000,000 FIRST NATIONAL BANK OF COMMERCE, NEW
ORLEANS
PERCENTAGE:
8.5714% By: ______________________________________
Name: __________________________________
Title: __________________________________
Notice Address:
▇▇▇ ▇▇. ▇▇▇▇▇▇▇ ▇▇., ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇
Telephone: 504/▇▇▇-▇▇▇▇
Facsimile: 504/561-1738
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109
EXHIBIT A
INTENTIONALLY OMITTED
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110
EXHIBIT B
FORM OF OPINION
______________, 19_____
The Agent and the Lenders
who are parties to Credit Agreement described below
Gentlemen/Ladies:
We are counsel for RFS Partnership, L.P. (the "Borrower"), and have
represented the Borrower in connection with its execution and delivery of that
certain Second Amended and Restated Revolving Credit and Term Loan Agreement
among the Borrower, NationsBank, N.A., individually and as Agent, and the
Lenders named therein, providing for Advances in an aggregate principal amount
not exceeding $175,000,000 at any one time outstanding and dated as of October
1, 1997 (the "Agreement"). All capitalized terms used in this opinion and not
otherwise defined shall have the meanings attributed to them in the Agreement.
We have examined the Borrower's Partnership Agreement and Covenants as
well as the Guarantor's articles of incorporation, by-laws, and resolutions, the
Loan Documents and such other matters of fact and law which we deem necessary in
order to render this opinion. Based upon the foregoing, it is our opinion that:
1. The Borrower and the Guarantor and each of their Subsidiaries
and each Qualified Borrower are either duly incorporated
corporations or duly qualified and formed limited
partnerships, validly existing and in good standing under the
laws of their states of incorporation or formation, and they
each have all requisite authority and power to enter into, and
perform the obligations under, the Loan Documents and to
conduct business in each jurisdiction in which they conduct
business.
2. The execution and delivery of the Loan Documents by the
Borrower and the Guarantor and the performance by them of
their respective obligations under the Loan Documents have
been duly authorized by all necessary corporate action and/or
proceedings on their part and will not:
(a) require any consent of the Borrower's limited
partners or the Guarantor's shareholders;
(b) violate any law, rule, regulation, order, writ,
judgment, injunction, decree or award binding on the
Borrower or the Guarantor or any of their
Subsidiaries
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111
or the Borrower's, the Guarantor's or any
Subsidiary's articles of incorporation, by-laws,
certificate of limited partnership, partnership
agreement, or any indenture, instrument or agreement
binding upon the Borrower or the Guarantor or any of
their Subsidiaries,
(c) result in, or require, the creation or imposition of
any Lien pursuant to the provisions of any indenture,
instrument or agreement binding upon the Borrower or
the Guarantor or any of their Subsidiaries
3. The Loan Documents have been duly executed and delivered by
the Borrower and the Guarantor and constitute their legal,
valid and binding obligations enforceable in accordance with
their respective terms except to the extent the enforcement
thereof may be limited by bankruptcy, insolvency or similar
laws affecting the enforcement of creditors' rights generally
and subject also to the availability of equitable remedies if
equitable remedies are sought.
4. There is no litigation or proceeding against the Borrower or
the Guarantor or any of their Subsidiaries which, if adversely
determined, could have a Material Adverse Effect.
5. No approval, authorization, consent, adjudication or order of,
or registration or filing with, any governmental authority,
which has not been obtained or made by the Borrower or the
Guarantor or any of their Subsidiaries, is required to be
obtained or made by the Borrower or the Guarantor or any of
their Subsidiaries in connection with the execution and
delivery of the Loan Documents, the borrowings under the
Agreement or in connection with the payment by the Borrower of
the Guarantor of their obligations under the Loan Documents.
6. The Loan does not violate the usury laws or laws regulating
the use or forbearance of money of Tennessee and the operation
of any term of the Agreement or Loan Documents, including,
without limitation, the terms regarding late charges and
default interest rate or the lawful exercise of any right
thereunder, shall not render the Agreement or Loan Documents
unenforceable, in whole or in part, or subject to any right of
rescission. set-off, counterclaim or defense.
7. The Guarantor qualifies as a real estate investment trust in
accordance with all applicable requirements of the Internal
Revenue Code.
This opinion may be relied upon by the Agent, the Lenders and their
participants, assignees and other transferees.
Very truly yours,
-------------------------
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112
EXHIBIT C
COMPLIANCE CERTIFICATE
112
113
EXHIBIT D
ASSIGNMENT AGREEMENT
This Assignment Agreement (this "Assignment Agreement") between
______________________ (the "Assignor") and _______________________ (the
"Assignee") is dated as of ______________, 19___. The parties hereto agree as
follows:
1. PRELIMINARY STATEMENT. The Assignor is a party to that certain
Second Amended and Restated Revolving Credit and Term Loan Agreement (which, as
it may be amended, modified, renewed or extended from time to time is herein
called the "Credit Agreement") described in Item I of Schedule 1 attached hereto
("Schedule 1"). Capitalized terms used herein and not otherwise defined herein
shall have the meanings attributed to them in the Credit Agreement.
2. ASSIGNMENT AND ASSUMPTION. The Assignor hereby sells and assigns to
the Assignee, without recourse and without representation or warranty, express
or implied, except as expressly set forth herein, and the Assignee hereby
purchases and assumes from the Assignor, an interest in and to the Assignor's
rights and obligations under the Credit Agreement and the other Loan Documents,
such that after giving effect to such assignment the Assignee shall have
purchased pursuant to this Assignment Agreement the percentage interest
specified in Item 3 of Schedule 1 of all outstanding rights and obligations
under the Credit Agreement and the other Loan Documents. The aggregate
Commitment (or Loans, if the applicable Commitment has been terminated)
purchased by the Assignee hereunder is set forth in Item 4 of Schedule 1.
3. EFFECTIVE DATE. The effective date of this Assignment Agreement (the
"Effective Date") shall be the later of the date specified in Item 5 of Schedule
1 or, if any Assignor is other than NationsBank two (2) Business Days (or such
shorter period agreed to by the Agent) after a Notice of Assignment
substantially in the form of Exhibit "I" attached hereto has been delivered to
the Agent. In no event will the Effective Date occur if the payments required to
be made by the Assignee to the Assignor on the Effective Date under Section 4
hereof are not made on the proposed Effective Date, unless otherwise agreed to
in writing by Assignor and Assignee. The Assignor will notify the Assignee of
the proposed Effective Date no later than the Business Day prior to the proposed
Effective Date. As of the Effective Date, (i) the Assignee shall have the rights
and obligations of a Lender under the Loan Documents with respect to the rights
and obligations assigned to the Assignee hereunder and (ii) the Assignor shall
relinquish its rights and be released from its corresponding obligations under
the Loan Documents with respect to the rights and obligations assigned to the
Assignee hereunder.
4. PAYMENTS OBLIGATIONS. On and after the Effective Date, the Assignee
shall be entitled to receive from the Agent all payments of principal, interest
and fees with respect to the interest assigned hereby. The Assignee shall
advance funds directly to the Agent with respect to all Loans and reimbursement
payments made on or after the Effective Date with respect to the
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114
interest assigned hereby. In consideration for the sale and assignment of Loans
hereunder, (i) the Assignee shall pay the Assignor, on the Effective Date, an
amount equal to the principal amount of the portion of all Prime Loans assigned
to the Assignee hereunder and (ii) with respect to each LIBOR Loan made by the
Assignor and assigned to the Assignee hereunder which is outstanding on the
Effective Date, (a) on the last day of the Interest Period therefor or (b) on
such earlier date agreed to by the Assignor and the Assignee or (c) on the date
on which any such LIBOR Loan either becomes due (by acceleration or otherwise)
or is prepaid (the date as described in the foregoing clauses (a), (b) or (c)
being hereinafter referred to as the "LIBOR Due Date"), the Assignee shall pay
the Assignor an amount equal to the principal amount of the portion of such
LIBOR Loan assigned to the Assignee which is outstanding on the LIBOR Due Date.
If the Assignor and the Assignee agree that the applicable LIBOR Due Date for
such LIBOR Loan shall be the Effective Date, they shall agree, solely for
purposes of dividing interest paid by the Borrower on such LIBOR Loan, to an
alternate interest rate applicable to the portion of such Loan assigned
hereunder for the period from the Effective Date to the end of the related
Interest Period (the "Agreed Interest Rate") and any interest received by the
Assignee in excess of the Agreed Interest Rate, with respect to such LIBOR Loan
for such period, shall be remitted to the Assignor. In the event a prepayment of
any LIBOR Loan which is existing on the Effective Date and assigned by the
Assignor to the Assignee hereunder occurs after the Effective Date but before
the applicable LIBOR Due Date, the Assignee shall remit to the Assignor any
excess of the funding indemnification amount paid by the Borrower under Section
3.4 of the Credit Agreement as well as an account of such prepayment with
respect to the portion of such LIBOR Loan assigned to the Assignee hereunder
over the amount which would have been paid if such prepayment amount were
calculated based on the Agreed Interest Rate and only covered the portion of the
Interest Period after the Effective Date. The Assignee will promptly remit to
the Assignor (i) the portion of any principal payments assigned hereunder and
received from the Agent with respect to any LIBOR Loan prior to its LIBOR Due
Date and (ii) any amounts of interest on Loans and fees received from the Agent
which relate to the portion of the Loans assigned to the Assignee hereunder for
periods prior to the Effective Date, in the case of Prime Loans or fees, or the
LIBOR Due Date, in the case of LIBOR Loans, and not previously paid by the
Assignee to the Assignor. In the event that either party hereto receives any
payment to which the other party hereto is entitled under this Assignment
Agreement, then the party receiving such amount shall promptly remit it to the
other party hereto.
5. REPRESENTATIONS OF THE ASSIGNOR; LIMITATIONS ON THE ASSIGNOR'S
LIABILITY. The Assignor represents and warrants that it is the legal and
beneficial owner of the interest being assigned by it hereunder and that such
interest is free and clear of any adverse claim created by the Assignor. It is
understood and agreed that the assignment and assumption hereunder are made
without recourse to the Assignor and that the Assignor makes no other
representation or warranty of any kind to the Assignee. Neither the Assignor nor
any of its officers, directors, employees, agents or Attorneys shall be
responsible for (i) the due execution, legality, validity, enforceability,
genuineness, sufficiency or collectability of any Loan Document, including
without limitation, documents granting the Assignor and the other Lenders a
security interest in assets of the Borrower or any guarantor, (ii) any
representation, warranty or statement made in or in connection with any of the
Loan Documents, (iii) the financial condition or
114
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creditworthiness of the Borrower or any guarantor, (iv) the performance of or
compliance with any of the terms or provisions of any of the Loan Documents, (v)
inspecting any of the Collateral Pool Properties, books or records of the
Borrower, the Guarantor, their Subsidiaries or Investment Affiliates, (vi) the
validity, enforceability, perfection, priority, condition, value or sufficiency
of any collateral securing or purporting to secure the Loans or (vii) any
mistake, error of judgment, or action taken or omitted to be taken in connection
with the Loans or the Loan Documents.
6. REPRESENTATIONS OF THE ASSIGNEE. The Assignee (i) confirms that it
has received a copy of the Credit Agreement and the other Loan Documents,
together with copies of the financial statements requested by the Assignee and
such other documents and information as it has deemed appropriate to make its
own credit analysis and decision to enter into this Assignment Agreement, (ii)
agrees that it will, independently and without reliance upon the Agent, the
Documentation Agent, the Assignor or any other Lender and based on such
documents and information at it shall deem appropriate at the time, continue to
make its own credit decisions in taking or not taking action under the Loan
Documents, (iii) appoints and authorizes the Agent to take such action as agent
on its behalf and to exercise such powers under the Loan Documents as are
delegated to the Agent by the terms thereof, together with such powers as are
reasonably incidental thereto, (iv) agrees that it will perform in accordance
with their terms all of the obligations which by the terms of the Loan Documents
are required to be performed by it as a Lender, (v) agrees that its payment
instructions and notice instructions are as set forth in the attachment to
Schedule 1, (vi) confirms that none of the funds, monies, assets or other
consideration being used to make the purchase and assumption hereunder are "plan
assets" as defined under ERISA and that its rights, benefits and interests in
and under the Loan Documents will not be "plan assets" under ERISA, (vii)
attaches either U.S. Internal Revenue Service Form 4224 or Form 1001 certifying
that the Assignee claims entitlement to complete exemption from U.S. Federal
withholding tax on all interest payments under the Loans and (viii) if Assignee
is organized under the laws of any jurisdiction other than the United States or
any state thereof, agrees to provide Assignor and the Agent a new Form 4224 or
Form 1001 upon the expiration or obsolescence of any previously delivered form
and comparable statements in accordance with applicable U.S. laws and
regulations, and amendments duly executed and completed by Assignee, and to
comply from time to time with all applicable U.S. laws and regulations with
regard to such withholding tax exemption.
7. INDEMNITY. The Assignee agrees to indemnify and hold the Assignor
harmless against any and all losses, costs and expenses (including, without
limitation, reasonable attorneys' fees) and liabilities incurred by the Assignor
in connection with or arising in any manner from the Assignee's nonperformance
of the obligations assumed under this Assignment Agreement.
8. REDUCTIONS OF AGGREGATE COMMITMENT. If any reduction in the
Aggregate Commitment occurs between the date of this Assignment Agreement and
the Effective Date, the percentage interest specified in Item 3 of Schedule I
shall remain the same, but the dollar amount purchased shall be recalculated
based on the reduced Aggregate Commitment.
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9. ENTIRE AGREEMENT. This Assignment Agreement and the attached Notice
of Assignment embody the entire agreement and understanding between the parties
hereto and supersede all prior agreements and understandings between the parties
hereto relating to the subject matter hereof.
10. GOVERNING LAW. This Assignment Agreement shall be governed by the
internal law, and not the law of conflicts, of the State of Tennessee.
11. NOTICES. Notices shall be given under this Assignment Agreement in
the manner set forth in the Credit Agreement. For the purpose hereof, the
addresses of the parties hereto (until notice of a change is delivered) shall be
the address set forth in the attachment to Schedule 1.
IN WITNESS WHEREOF, the parties hereto have executed this Assignment
Agreement by their duly authorized officers as of the date first above written.
[NAME OF ASSIGNOR]
By: ________________________________
Title: ________________________________
[NAME OF ASSIGNEE]
By: ________________________________
Title: ________________________________
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SCHEDULE I
to Assignment Agreement
1. Description and Date of Credit Agreement:
2. Date of Assignment Agreement: _____________, 19___
3. Amounts (As of Date of Item 2 above):
a. Aggregate Commitment
(Loans)* under
Credit Agreement $_________
b. Assignee's Percentage of the Aggregate
Commitment purchased under this
Assignment Agreement** _________%
4. Amount of Assignee's Commitment
(Loan Amount)* Purchased under this
Assignment Agreement: $_________
5. Amount of Assignor's Commitment
(Loan Amount) After Purchase under this
Assignment Agreement $_________
6. Proposed Effective Date: _________
Accepted and Agreed:
[NAMES OF ASSIGNOR] [NAMES OF ASSIGNEE]
By: ___________________________ By: ___________________________
Title: ___________________________ Title: ___________________________
* If a Commitment has been terminated, insert outstanding Loans in place
of Commitment
** Percentage taken to 8 decimal places
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Attachment to SCHEDULE I to ASSIGNMENT AGREEMENT
Attach Assignor's Administrative Information Sheet, which must include
notice address and account information for the Assignor and the Assignee
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119
EXHIBIT "I"
to Assignment Agreement
NOTICE
OF ASSIGNMENT
______________, 19___
To: [NAME OF AGENT]
From: [NAME OF ASSIGNOR] (the "Assignor")
[NAME OF ASSIGNEE] (the "Assignee")
1. We refer to that Second Amended and Restated Revolving Credit and
Term Loan Agreement (the "Credit Agreement") described in Item 1 of Schedule I
attached hereto ("Schedule I"). Capitalized terms used herein and not otherwise
defined herein shall have the meanings attributed to them in the Credit
Agreement.
2. This Notice of Assignment (this "Notice") is given and delivered to
the Agent pursuant to Section 13.3.2 of the Credit Agreement.
3. The Assignor and the Assignee have entered into an Assignment
Agreement, dated as of ____________, 19__ (the "Assignment"), pursuant to which,
among other things, the Assignor has sold, assigned, delegated and transferred
to the Assignee, and the Assignee has purchased, accepted and assumed from the
Assignor the percentage interest specified in Item 3 of Schedule I of all
outstandings, rights and obligations under the Credit Agreement. From and after
such purchase, the Assignee's Commitment shall be the amount specified in Item 4
of Schedule I and the Assignor's Commitment shall be the amount specified in
Item 5 of Schedule I. The Effective Date of the Assignment shall be the later of
the date specified in Item 5 of Schedule I or two (2) Business Days (or such
shorter period as agreed to by the Agent) after this Notice of Assignment has
been delivered to the Agent, provided that the Effective Date shall not occur if
any condition precedent agreed to by the Assignor and the Assignee or set forth
in Section 13 of the Credit Agreement has not been satisfied.
4. The Assignor and the Assignee hereby give to the Agent notice of the
assignment and delegation referred to herein. The Assignor will confer with the
Agent before the date specified in Item 6 of Schedule I to determine if the
Assignment Agreement will become effective on such date pursuant to Section 3
hereof, and will confer with the Agent to determine the Effective Date pursuant
to Section 3 hereof if it occurs thereafter. The Assignor shall notify the Agent
if the Assignment Agreement does not become effective on any proposed Effective
Date as
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120
a result of the failure to satisfy the conditions precedent agreed to by the
Assignor and the Assignee. At the request of the Agent, the Assignor will give
the Agent written confirmation of the satisfaction of the conditions precedent.
5. The Assignor or the Assignee shall pay to the Agent on or before the
Effective Date the processing fee of $3,500 required by Section 13.3.2 of the
Credit Agreement.
6. If Notes are outstanding on the Effective Date, the Assignor and the
Assignee request and direct that the Agent prepare and cause the Borrower to
execute and deliver new Notes or, as appropriate, replacements notes, to the
Assignor and the Assignee. The Assignor and, if applicable, the Assignee each
agree to deliver to the Agent the original Note received by it from the Borrower
upon its receipt of a new Note in the appropriate amount.
7. The Assignee advises the Agent that notice and payment instructions
are set forth in the attachment to Schedule I.
8. The Assignee hereby represents and warrants that none of the funds,
monies, assets or other consideration being used to make the purchase pursuant
to the Assignment are "plan assets" as defined under ERISA and that its rights,
benefits, and interests in and under the Loan Documents will not be "plan
assets" under ERISA.
9. The Assignee authorizes the Agent to act as its agent under the Loan
Documents in accordance with the terms thereof. The Assignee acknowledges that
the Agent has no duty to supply information with respect to the Borrower or the
Loan Documents to the Assignee until the Assignee becomes a party to the Credit
Agreement.*
* May be eliminated if Assignee is a party to the Credit Agreement
prior to the Effective Date.
NAME OF ASSIGNOR NAME OF ASSIGNEE
By: ___________________________ By: ___________________________
Title: ___________________________ Title: ___________________________
ACKNOWLEDGED AND CONSENTED TO BY Agent
By: ___________________________
Title: ___________________________
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[ATTACH PHOTOCOPY OF SCHEDULE I TO ASSIGNMENT]
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EXHIBIT E
LOAN/CREDIT RELATED MONEY TRANSFER INSTRUCTION
To: The NationsBank, N.A.
as Agent (the "Agent") under the Credit Agreement Described
Below
Re: Second Amended and Restated Revolving Credit and Term Loan
Agreement, dated as of October 1, 1997, (as amended, modified,
renewed or extended from time to time, the "Agreement"), among
RFS Partnership, L.P. (the "Borrower"), NationsBank, N.A.,
individually and as Agent, and the Lenders named therein.
Terms used herein and not otherwise defined shall have the
meanings assigned thereto in the Credit Agreement.
The Agent is specifically authorized and directed to act upon the
following standing money transfer instructions with respect to the proceeds of
Advances or other extensions of credit from time to time until receipt by the
Agent of a specific written revocation of such instructions by the Borrower,
provided, however, that the Agent may otherwise transfer funds as hereafter
directed in writing by the Borrower in accordance with Section 14.1 of the
Credit Agreement or based on any telephonic notice made in accordance with
Section 2.14 of the Credit Agreement.
Facility Identification Number(s): ___________________________________
Customer/Account Name: _____________________________________________
Transfer Funds To: _____________________________________________
For Account No.: ______________________________________________________
Reference/Attention To: _______________________________________________
Authorized Officer (Customer Representative): _________________________
Date: ______________________________________
Signature: _________________________________
Bank Officer Name: _________________________
(please print)
Date: ______________________________________
(Deliver Completed Form to Credit Support Staff For Immediate Processing)
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EXHIBIT F
Minimum Specifications for
Environmental Investigations
(See attached)
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EXHIBIT G
Secured Collateral Pool
(October 1, 1997)
Hotel (Franchise) City State Franchisor Cost*
----------------- ---- ----- ---------- -----
1. Comfort Inn Conyers GA Choice $3,714,540
2. Comfort Inn Farmington Hills MI Choice 5,513,618
3. Comfort Inn Grand Rapids MI Choice 4,052,398
4. Comfort Inn Clemson SC Choice 5,838,046
5. Executive Inn Tupelo MS N/A 4,418,644
6. Hampton Ft. Lauderdale FL Hampton 5,900,341
7. Hampton Indianapolis IN Hampton 9,119,346
8. Hampton Lansing MI Hampton 4,764,667
9. Hampton Warren MI Hampton 3,902,498
10. Hampton Bloomington MN Hampton 9,795,620
11. Hampton Minnetonka MN Hampton 6,075,404
12. Hampton Lincoln NE Hampton 5,993,657
13. Hampton Tulsa OK Hampton 6,862,347
14. Hampton Memphis TN Hampton 7,800,520
15. Hawthorne Atlanta GA Hawthorne Suites 20,640,834
16. Holiday Inn Louisville KY Holiday 6,540,819
17. Holiday Inn Lafayette LA Holiday 11,612,760
18. Holiday Inn Flint MI Holiday 14,815,362
19. Holiday Inn Clayton MO Holiday 10,002,483
124
125
20. Holiday Inn Columbia SC Holiday 5,632,340
21. Holiday Inn Express Arlington Heights IL Holiday 5,244,817
22. Holiday Inn Express Downers Grove IL Holiday 6,986,167
23. Holiday Inn Express Bloomington MN Holiday 8,331,925
24. Holiday Inn Express Tupelo MS Holiday 2,867,732
25. Holiday Inn Express Franklin TN Holiday 3,578,114
26. Holiday Inn Express Wauwatosa WI Holiday 6,307,240
27. Residence Inn Torrance CA Residence 22,234,152
28. Residence Inn Wilmington DE Residence 10,579,613
29. Residence Inn Kansas City MO Residence 6,268,592
*as of 7/30/97
Choice = Choice Hotels International, Inc.
Hampton = Hampton Inn Hotel Division, Inc. Promus Hotel Corp.
Holiday = Holiday Inn Franchise Division, Inc. Holiday Inn
Worldwide
Residence = Residence Inn by Marriott
Promus = Promus Hotel Corporation
ITT = ITT Sheraton
Marriott = Marriott International, Inc.
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126
EXHIBIT H
Negative Collateral Pool
(October 1, 1997)
Hotel (Franchise) City State Franchise Cost*
----------------- ---- ----- --------- -----
1. Courtyard by Marriott Flint MI Marriott $6,449,897
2. Hampton Laredo TX Promus 5,856,805
3. Hampton Plano TX Promus 6,913,725
4. Hampton Houston TX Promus 6,467,804
5. Homewood Salt Lake City UT Promus 7,553,661
6. Residence Inn Tyler TX Residence 7,961,426
7. Sheraton San Jose CA ITT 31,583,603
8. Sheraton Sunnyvale CA ITT 25,758,883
9. Sheraton Pleasanton CA ITT 23,530,924
10. Sheraton Bakersfield CA ITT 9,949,274
*As of 7/30/97
Choice = Choice Hotels International, Inc.
Hampton = Hampton Inn Hotel Division, Inc. Promus Hotel Corp.
Holiday = Holiday Inn Franchise Division, Inc. Holiday Inn
Worldwide
Residence = Residence Inn by Marriott
Promus = Promus Hotel Corporation
ITT = ITT Sheraton
Marriott = Marriott International, Inc.
126
127
EXHIBIT I-1
BORROWING NOTICE
Notice Date: _____________
TO: NationsBank, N.A., Agent
BORROWER: RFS Partnership, L. P.
LOAN: $175,000,000.00 Second Amended and Restated Revolving Credit
and Term Loan Agreement dated October 1, 1997 (as thereafter
amended from time to time referred to as the "Loan Agreement")
ADVANCE:
ADVANCE AMOUNT REQUESTED: $ ____________________________
EFFECTIVE DATE OF ADVANCE: (1 day for Prime Advance/3 days for LIBOR Advance
from Notice Date)
ADVANCE TYPE: Prime Advance/LIBOR Advance (Circle one)
If a LIBOR Advance:
INTEREST PERIOD: 30, 60, 90 or 180 (Circle One)
----------------------
EXPIRATION DATE OF
INTEREST PERIOD: _______________________________
INTEREST RATE WILL BE SET BY AGENT 2 BUSINESS DAYS PRIOR TO THE
EFFECTIVE DATE OF THE ADVANCE.
AGENT IS AUTHORIZED TO WIRE THE ADVANCE AMOUNT TO BORROWER'S ACCOUNT PER
STANDING WIRING INSTRUCTIONS.
PAYMENT:
PAYMENT AMOUNT REMITTED: $______________________
PROPOSED DATE OF PAYMENT: _______________________ (if different from above)
ADVANCE TYPE TO BE REPAID: Prime Advance/LIBOR Advance (Circle one)
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128
If a LIBOR Advance, select traunche to be repaid: $___________________________
(original $ amt of traunche)
____________________________
(orig Exp Date of traunche)
BREAK-UP FEE TO BE
COLLECTED IN ADDITION TO
PAYMENT AMOUNT: _____________________
THE ABOVE PAYMENT AMOUNT AND BREAK-UP FEE WILL BE WIRED BY BORROWER TO AGENT PER
STANDING WIRING INSTRUCTIONS.
All capitalized terms not otherwise defined herein shall have the meanings as
set forth in the Loan Agreement.
Borrower represents and warrants that:
1. All of the representations and warranties of the Borrower
contained in the Loan Agreement continue to be true and correct at
such time, both before and after giving effect to the application
of the proceeds of the Advance hereto;
2. The incumbency of the Authorized Officers of the corporate general
partner of the Borrower as stated in the most recent certificate
dated ___________________, 199__ delivered to the Agent by the
Borrower, has not been modified, amended or rescinded; and
3. There does not exist and, after giving effect to the Advance
hereto, there will not exist, a Default or Unmatured Default under
the Loan Agreement.
RFS Partnership, L.P.
By: RFS Hotel Investors, Inc.,
Its General Partner
By: _____________________________
Title: _____________________________
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129
EXHIBIT I-2
CONVERSION/CONTINUATION NOTICE
Notice Date:______________
TO: NationsBank, N.A., Agent
BORROWER: RFS Partnership, L. P.
LOAN: $175,000,000.00 Second Amended and Restated Revolving
Credit and Term Agreement dated October 1, 1997 (as
thereafter amended from time to time referred to as the
"Loan Agreement")
AMOUNT TO BE CONVERTED: $_________________
EFFECTIVE DATE OF CONVERSION: __________________
(1 day for PrimeAdvance/3 days for LIBOR Advance from Notice Date)
CONVERSION TYPE: ____________________________________
If converting to Prime Rate:
NOTE: No notice is required if the Effective Date of the Conversion is
at the end of the then applicable LIBOR Interest Period.
ORIGINAL AMOUNT AND EXPIRATION
DATE OF INTEREST PERIOD OF LIBOR
ADVANCE SUBJECT TO CONVERSION: $______________________________
If converting to LIBOR Rate:
INTEREST PERIOD: 30, 60, 90 or 180 (Circle One)
----------------------
EXPIRATION DATE OF
INTEREST PERIOD: _____________________
INTEREST RATE: _____________________
BREAK-UP FEE TO BE COLLECTED: $_____________________
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130
THE ABOVE BREAK-UP FEE WILL BE WIRED BY BORROWER TO AGENT PER STANDING WIRING
INSTRUCTIONS.
All capitalized terms not otherwise defined herein shall have the meanings as
set forth in the Loan Agreement.
Borrower represents and warrants that:
1. All of the representations and warranties of the Borrower under
the Loan Agreement continue to be true and correct at such time,
both before and after giving effect to the application of the
conversion hereto;
2. The incumbency of the Authorized Officers of the corporate general
partner of the Borrower as stated in the most recent certificate
dated ___________________, 199__ delivered to the Agent by the
Borrower, has not been modified, amended or rescinded; and
3. There does not exist and, after giving effect to the conversion
hereto, there will not exist, a Default or an Unmatured Default
under the Loan Agreement.
RFS Partnership, L.P.
By: RFS Hotel Investors, Inc.,
General Partner
By: _____________________________
Title: _____________________________
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131
EXHIBIT I-3
LETTER OF CREDIT REQUEST
I,____________________ , am an Authorized Officer of RFS Hotel
Investors, Inc. (the "General Partner"), the general partner of RFS Partnership,
L.P. (the "Borrower"), and as such Authorized Officer, do hereby certify
pursuant to the provisions of the Second Amended and Restated Revolving Credit
and Term Loan Agreement dated October 1, 1997 (as amended from time to time, the
"Loan Agreement"), by and among the Borrower, the Lenders thereto (collectively,
the "Lenders"), to___________________ [NationsBank, N.A. or other Lender], as
issuer of certain letters of credit (in such capacity, the "Issuing Bank") and
NationsBank, N.A., as agent for the Lenders (in such capacity, the "Agent"),
that:
1. Pursuant to Section 3.4 of the Loan Agreement, the Borrower
hereby requests the issuance by the Issuing Bank of a Facility
Letter of Credit in the stated amount of $______________ to be
issued on ____________, 199__ (the "Issuance Date") and expire
on _____________________, 199__, for the benefit of
___________________________ (the "Beneficiary"), substantially
in the form of or containing the terms as set forth in Exhibit
A attached hereto.
2. The address of the Beneficiary is as follows:
3. I hereby certify to the Agent that the Issuing Bank is
permitted to issue such Facility Letter of Credit for such
purpose under the terms of Section 7.2 of the Loan Agreement.
The purpose of such Letter of Credit is:
--------------------------------------------------------------
4. After giving effect to the issuance of the Letter of Credit
hereto, the aggregate Facility Letter of Credit Obligations
will not exceed $10,000,000.00 and the Allocated Facility
Amount will not exceed the Aggregate Commitment.
5. There does not exist on this date, and will not exist after
issuance of the requested Facility Letter of Credit, a Default
or Unmatured Default.
6. No material adverse change has occurred in the business,
assets, liabilities, financial condition, results of
operations or business prospects of the Borrower since the
date of the Loan Agreement.
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7. All representations and warranties of the Borrower made under
the Loan Agreement, which in accordance with Section VI of the
Loan Agreement are made at and as of the time of such issuance
of the requested Facility Letter of Credit, are true and
correct in all material respects as of the date hereof, both
before and after giving effect to the issuance of the Facility
Letter of Credit in connection with which this Request is
given, except to the extent that such representations and
warranties relate solely to an earlier date (in such case such
representations and warranties shall have been true and
accurate on and as of such earlier date), and except for
changes in factual circumstances specifically permitted under
the Loan Agreement.
8. The incumbency of the Authorized Officers of the General
Partner, as stated in the most recent certificate dated
___________________, 199__ delivered to the Agent by the
Borrower, has not been modified, amended or rescinded.
Capitalized terms used herein and not otherwise defined are used as
defined in the Loan Agreement.
Dated as of this ________ day of ___________________, 199__.
RFS Partnership, L.P.
By: RFS Hotel Investors, Inc.,
General Partner
By: _____________________________
Title: _____________________________
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133
SCHEDULE 1
SUBSIDIARIES AND INVESTMENT AFFILIATES
1. RFS Managers, Inc. (owned 100% by RFS Hotel Investors, Inc.)
2. RFS Financing Partnership, L.P. (owned 99% by RFS Partnership, L.P. and
1% by RFS Financing Corp.)
3. RFS Financing Corp. (owned 100% by RFS Hotel Investors, Inc.)
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134
SCHEDULE 2
INDEBTEDNESS AND LIENS
None.
134
135
SCHEDULE 3
PLANS AND MULTIEMPLOYER PLANS
None.
135
136
SCHEDULE 4
ENVIRONMENTAL DISCLOSURES
None.
136
137
SCHEDULE 5
NONCOMPLIANCE WITH LAWS
None.
137
138
SCHEDULE 6
LITIGATION AND INVESTIGATIONS
Eminent Domain Proceeding (Case No. CV762336) styled Santa ▇▇▇▇▇ County
Transit District v. ▇▇▇ Enterprises VIII, Title Insurance and Trust Co., Society
National Bank, Trustee of the ▇▇▇▇▇▇ ▇▇▇▇ Trust No. 9, RCA Corp., Sunnyvale
Host, Inc., Prudential Insurance Co. and DOES I-50 inclusive. [Note RFS
Partnership, L.P., is successor in interest to ▇▇▇ Enterprises VIII.]
138
139
SCHEDULE 7
CONTINGENT OBLIGATIONS
None.
139
140
SCHEDULE 8
INDEBTEDNESS DEFAULTS
None.
140
141
SCHEDULE 9
LESSEES AND MANAGERS OTHER THAN RFS, INC.
None.
141
142
TABLE OF CONTENTS
ARTICLE I DEFINITIONS.........................................................................................
ARTICLE II THE CREDIT..........................................................................................
2.1 Assignment and Assumption; Conversion; Commitment Increase...................................
2.1.1 Assignment and Assumption....................................................................
2.1.2 Conversion...................................................................................
2.1.3 Commitment Increase; Notes...................................................................
2.2 Final Principal Payment and Extension Option.................................................
2.3 Ratable Loans................................................................................
2.4 Collateral...................................................................................
2.5 Unused Credit Fee............................................................................
2.6 Commitment Fee; Other Fees...................................................................
2.6.1 Commitment Fee...............................................................................
2.6.2 Other Fees...................................................................................
2.7 Minimum Amount of Each Advance...............................................................
2.8 Optional Principal Payments..................................................................
2.9 Manner of Borrowing and Method of Selecting Types and Interest Periods for
New Advances; Borrowing Base; Lender Obligations.............................................
2.9.1 Manner of Borrowing and Method of Selecting Types and Interest Periods for
New Advances.................................................................................
2.9.2 Borrowing Base...............................................................................
2.9.3 Lender Obligations...........................................................................
2.10 Conversion and Continuation of Outstanding Advances..........................................
2.11 Changes in Interest Rate, Etc................................................................
2.12 Rates Applicable After Default; Late Fee.....................................................
2.13 Method of Payment............................................................................
2.14 Notes; Telephonic Notices....................................................................
2.15 Interest Payment Dates; Interest and Fee Basis...............................................
2.16 Notification of Advances, Interest Rates and Prepayments.....................................
2.17 Lending Installations........................................................................
2.18 Non-Receipt of Funds By the Agent...........................................................
2.19 Withholding Tax Exemption....................................................................
2.20 Voluntary Reduction of Aggregate Commitment Amount...........................................
2.21 Usury........................................................................................
2.22 Application of Moneys Received by the Agent..................................................
ARTICLE III THE LETTER OF CREDIT SUBFACILITY..................................................................
3.1 Obligation to Issue..........................................................................
3.2 Types and Amounts............................................................................
3.3 Conditions...................................................................................
3.4 Procedure for Issuance of Facility Letters of Credit.........................................
3.5 Reimbursement Obligations, Duties of Issuing Bank............................................
3.6 Participation................................................................................
3.7 Payment of Reimbursement Obligations.........................................................
3.8 Compensation for Facility Letters of Credit..................................................
3.9 Letter of Credit Collateral Account..........................................................
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ARTICLE IV CHANGE IN CIRCUMSTANCES............................................................................
4.1 Yield Protection.............................................................................
4.2 Changes in Capital Adequacy Regulations......................................................
4.3 Funding Indemnification......................................................................
4.4 Lender Statements, Survival of Indemnity.....................................................
4.5 Limitation on the Borrower's Liability.......................................................
ARTICLE V CONDITIONS PRECEDENT................................................................................
5.1 Conditions to Closing........................................................................
5.2 Conditions to Each Advance, Issuance of Facility Letter of Credit and
Continuation/Conversion......................................................................
5.3 Conditions to Secured Collateral Pool........................................................
(a) Security Documents..................................................................
(b) Security Agreements.................................................................
(c) Evidence of Due Authorization of Security Documents and Corporate
or Partnership Good Standing........................................................
(d) Assignments of Rents and Leases.....................................................
(e) Franchise Agreements................................................................
(f) Leases..............................................................................
(g) Subordinations......................................................................
(h) Management Agreements...............................................................
(i) Surveys.............................................................................
(j) Title Insurance Policies............................................................
(k) Environmental Audits................................................................
(l) Physical Inspections................................................................
(m) Certificates of Insurance..........................................................
(n) Appraisals..........................................................................
(o) Environmental Indemnity.............................................................
(p) Opinion of Counsel..................................................................
(q) Independent Market Study............................................................
(r) Certificate of Occupancy; As Built Plans and Specifications.........................
(s) Zoning Compliance...................................................................
(t) Permit Assurances...................................................................
(u) Operating Statements................................................................
(v) Doing Business Opinion or Title Endorsement.........................................
(w) Photographs.........................................................................
(x) Legal Description...................................................................
(y) Site Plan...........................................................................
(z) Location Map........................................................................
(aa) Borrowing Base......................................................................
(bb) Pro forma Compliance Certificate....................................................
(cc) Other Documents.....................................................................
5.4 Conditions to Negative Collateral Pool.......................................................
(a) Negative Pledge.....................................................................
(b) UCC Searches........................................................................
(c) Evidence of Due Authorization and Corporate or
Partnership Good Standing...........................................................
(d) Franchise Agreements................................................................
(e) Leases..............................................................................
(f) Management Agreements...............................................................
(g) Title Insurance Policies; Updated Searches..........................................
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144
(h) Environmental Audits................................................................
(i) Physical Inspections................................................................
(j) Appraisals..........................................................................
(k) Environmental Indemnity.............................................................
(l) Operating Statements................................................................
(m) Photographs.........................................................................
(n) Legal Description
(o) Site Plan...........................................................................
(p) Location Map........................................................................
(q) Independent Market Study............................................................
(r) Borrowing Base......................................................................
(s) Pro forma Compliance Certificate....................................................
(t) Other Documents.....................................................................
ARTICLE VI REPRESENTATIONS AND WARRANTIES..
6.1 Existence....................................................................................
6.2 Authorization and Validity
6.3 No Conflict; Government Consent..............................................................
6.4 Financial Statements; Material Adverse Change................................................
6.5 Taxes........................................................................................
6.6 Litigation and Contingent Obligations........................................................
6.7 Subsidiaries.................................................................................
6.8 ERISA........................................................................................
6.9 Accuracy of Information......................................................................
6.10 Regulation U.................................................................................
6.11 Material Agreements..........................................................................
6.12 Compliance With Laws.........................................................................
6.13 Ownership of Collateral Pool Properties......................................................
6.14 Investment Company Act.......................................................................
6.15 Public Utility Holding Company Act...........................................................
6.16 Solvency ....................................................................................
6.17 Insurance....................................................................................
6.18 NYSE and REIT Status.........................................................................
6.19 Environmental Matters........................................................................
6.20 Licenses, etc................................................................................
6.21 Judgments....................................................................................
6.22 Lessee; Property Manager.....................................................................
6.23 Updated Schedules............................................................................
6.24 Collateral Pool Properties...................................................................
ARTICLE VII COVENANTS.........................................................................................
7.1 Financial Reporting..........................................................................
7.2 Use of Proceeds..............................................................................
7.3 Notice of Default............................................................................
7.4 Conduct of Business..........................................................................
7.5 Taxes........................................................................................
7.6 Insurance....................................................................................
7.7 Compliance with Laws.........................................................................
7.8 Maintenance of Collateral Pool Properties....................................................
7.9 Inspection...................................................................................
7.10 Maintenance of Status........................................................................
7.11 Dividends....................................................................................
7.12 Merger; Sale of Assets.......................................................................
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7.13 Release of Mortgages or Negative Pledge Agreements...........................................
7.14 Liens........................................................................................
7.15 Affiliates...................................................................................
7.16 Interest Rate Hedging........................................................................
7.17 Consolidated Net Worth.......................................................................
7.18 Additional Financial Covenants...............................................................
(a) Debt Coverage Ratios................................................................
(b) Minimum Interest Coverage...........................................................
(c) Total Indebtedness Limitation.......................................................
(d) Total Liabilities Limitation........................................................
(e) Borrowing Base to Value Ratio.......................................................
(f) Limit on Additional Indebtedness....................................................
(g) Borrowing Base......................................................................
7.19 Environmental Matters........................................................................
7.19.1 Violation....................................................................................
7.19.2 Notice to the Lenders........................................................................
7.19.3 Site Assessments and Information.............................................................
7.19.4 Remedial Actions.............................................................................
7.19.5 Indemnity....................................................................................
7.20 Negative Pledge Agreements...................................................................
7.21 Manager......................................................................................
7.22 Acceleration Notice..........................................................................
7.23 Additional Covenants.........................................................................
7.24 Calculation of Financial Covenants Upon Property Breaches....................................
7.25 Leases.......................................................................................
7.26 Franchises...................................................................................
ARTICLE VIII DEFAULTS..........................................................................................
ARTICLE IX ACCELERATION, WAIVERS, AMENDMENTS AND REMEDIES......................................................
9.1 Acceleration.................................................................................
9.2 Amendments, Waivers, Decisions...............................................................
9.3. Preservation of Rights.......................................................................
ARTICLE X GENERAL PROVISIONS.................................................................................
10.1 Survival of Representations..................................................................
10.2 Governmental Regulation......................................................................
10.3 Taxes........................................................................................
10.4 Headings ....................................................................................
10.5 Entire Agreement.............................................................................
10.6 Several Obligations; Benefits of This Agreement..............................................
10.7 Expenses; Indemnification....................................................................
10.8 Numbers of Documents.........................................................................
10.9 Accounting...................................................................................
10.10 Severability of Provisions...................................................................
10.11 Nonliability of Lenders, Arranger, Agent.....................................................
10.12 Publicity....................................................................................
10.13 Brokers......................................................................................
10.14 Confidentiality..............................................................................
10.15 Appraisals...................................................................................
10.16 CHOICE OF LAW................................................................................
10.17 CONSENT TO JURISDICTION......................................................................
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146
10.18 WAIVER OF JURY TRIAL.........................................................................
10.19 MANDATORY ARBITRATION........................................................................
(a) SPECIAL RULES.......................................................................
(b) RESERVATIONS OF RIGHTS..............................................................
ARTICLE XI THE AGENT AND AGREEMENTS AMONG LENDERS.............................................................
11.1 Appointment..................................................................................
11.2 Powers.......................................................................................
11.3 General Immunity.............................................................................
11.4 No Responsibility for Loans, Recitals, etc...................................................
11.5 Action on Instructions of Lenders............................................................
11.6 Employment of Agents and Counsel.............................................................
11.7 Reliance on Documents, Counsel...............................................................
11.8 Agent's Reimbursement and Indemnification....................................................
11.9 Rights as a Lender...........................................................................
11.10 Lender Credit Decision; Non-Reliance on Agents and Other Lenders.............................
11.11 Resignation: Removal of Agent; Successor Agent...............................................
11.12 Notice of Defaults...........................................................................
11.13 Requests for Approval........................................................................
11.14 Copies of Documents..........................................................................
11.15 Defaulting Lenders...........................................................................
ARTICLE XII RATABLE PAYMENTS..................................................................................
ARTICLE XIII BENEFIT OF AGREEMENT; PARTICIPATIONS; ASSIGNMENTS................................................
13.1. Successors and Assigns.......................................................................
13.2 Participations...............................................................................
13.2.1 Permitted Participants; Effect...............................................................
13.2.2 Voting Rights................................................................................
13.3 Assignments..................................................................................
13.3.1 Permitted Assignments........................................................................
13.3.2 Effect; Effective Date.......................................................................
13.4 Dissemination of Information.................................................................
13.5 Tax Treatment................................................................................
13.6 Possession of Loan Documents and Register....................................................
ARTICLE XIV NOTICES...........................................................................................
14.1 Giving Notice................................................................................
14.2 Change of Address............................................................................
14.3 Accounts ....................................................................................
ARTICLE XV COUNTERPARTS.......................................................................................
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TABLE OF CONTENTS
(continued)
Exhibits:
Exhibit A Intentionally Omitted
Exhibit B Form of Opinion
Exhibit C Form of Compliance Certificate
Exhibit D Assignment Agreement
Exhibit E Loan/Credit Related Money Transfer Instruction
Exhibit F Minimum Specifications for Environmental Investigations
Exhibit G Secured Collateral Pool
Exhibit H Negative Collateral Pool
Exhibit I-1 Borrowing Notice
Exhibit I-2 Conversion/Continuation Notice
Exhibit I-3 Letter of Credit Request
Schedules:
Schedule 1 Subsidiaries and Investment Affiliates
Schedule 2 Indebtedness and Liens
Schedule 3 Plans and Multiemployer Plans
Schedule 4 Environmental Disclosures
Schedule 5 Noncompliance with Laws
Schedule 6 Litigation and Investigations
Schedule 7 Contingent Obligations
Schedule 8 Indebtedness Defaults
Schedule 9 Lessees and Managers other than RFS, Inc.
147