1
Exhibit 10.1
AMENDMENT NO. 4
to
CREDIT AGREEMENT
between
CAPTEC NET LEASE REALTY, INC.
a Michigan corporation, as borrower
and
CREDIT SUISSE FIRST BOSTON MORTGAGE CAPITAL LLC
a Delaware limited liability company
(as successor to CS First Boston Mortgage Capital Corp.,
its successors and assigns),
as lender
October 23, 1997
2
AMENDMENT NO. 4 TO CREDIT AGREEMENT
-----------------------------------
This Amendment No. 4 ("Amendment") to that certain Credit Agreement
dated February 26, 1996, as previously amended (the "Credit Agreement"), by and
between Captec Net Lease Realty, Inc., a Michigan corporation, as borrower
("Borrower") and Credit Suisse First Boston Mortgage Capital LLC, a Delaware
limited liability company (successor to CS First Boston Mortgage Capital Corp.,
a Delaware corporation), its successors and assigns, as lender ("Lender") is
entered into as of the 23rd day of October, 1997. Capitalized terms used and not
defined herein shall have the meanings attributed to them in the Credit
Agreement.
This Amendment is being entered into for good and valuable
consideration, the sufficiency and receipt of which are hereby acknowledged, and
subject to the following conditions and limitations, the parties hereto agree to
amend the Credit Agreement as follows:
1. SECTION 1(e)(i): Section 1(e)(i) is hereby amended by deleting
the amendment to Section 1(e)(i) which was effected in
paragraph 4 of Amendment No. 2 dated June 26, 1997 ("Amendment
No. 2") and substituting therefor the following:
PROVIDED, HOWEVER, upon (1) the completion by Borrower of an
S.E.C.-registered public offering of common stock of the
Borrower (in accordance with the applicable provisions of the
Credit Facility Documents) and (ii) written certification of
same by Borrower to Lender, the Revolving Loan Rate shall be
reduced to a rate per annum equal to the LIBOR Rate plus
1.750% (the "Adjusted Revolving Loan Rate"):
2. SECTION 3(e)(ii): Section 3(e)(ii) is hereby amended by
deleting the amendment of Section 3(e)(ii) which was effected
in paragraph 5 of Amendment No. 2 and substituted therefor the
following:
The principal amount outstanding of all Revolving Loans and
Improvement Loans shall not exceed 71.5% of the Eligible
Borrowing Base PROVIDED, HOWEVER, that after the Supplemental
Expiration Date (as defined in Amendment No. 3 to the Credit
Agreement), the principal
3
amount outstanding of all Revolving Loans and Improvement
Loans related to Loan Asset Categories (i) and (ii), as
identified in the definition of Eligible Borrowing Base, shall
also not exceed an amount equal to 95.0% of the capitalized
cost of all of the Loan Assets in such Loan Asset Categories
(the "Loan to Value Requirement").
3. SECTION 1(f): Section 1(f) is hereby amended by inserting at
the end thereof the following:
, provided however, after the completion by Borrower of an
S.E.C.-registered public offering of common stock of the
Borrower (in accordance with the applicable provisions of the
Credit Facility Documents) and provided this Agreement is in
full force and effect and no default on the part of the
Borrower exists hereunder, certain of the proceeds of the
Revolving Loans may be advanced to Borrower ("Dividend
Advance(s)") for the sole purpose of payment of dividends by
Borrower, provided: (i) such outstanding Dividend Advance(s)
in the aggregate value shall not exceed fifty percent (50%) of
the aggregate value equal to the lesser of (A) eighty-five
percent (85%) of the Appraised Value, or (B) ninety-five
percent (95%) of the capitalized cost, of Properties which are
unencumbered by any superior mortgages or liens at the time of
the Dividend Advance(s) and which are provided by Borrower to
Lender as additional security and subject to a first lien of
Lender under this Agreement for the Dividend Advance(s) (the
"Dividend Advance(s) Collateral"); such Dividend Advance(s)
outstanding shall not exceed an aggregate amount of Five
Million ($5,000,000) Dollars in any fiscal quarter and (iii)
the amount of any such Dividend Advance(s) shall be repaid by
Borrower to Lender within thirty (30) days of the date of any
such Dividend Advance(s), (the "Dividend Advance Repayment
Date") at which time such Dividend Advance(s) Collateral shall
be released from the lien of Lender. Failure by Borrower to
repay to Lender any Dividend Advance(s) on or before the
Dividend Advance Repayment Date shall constitute an Event of
Default under Section 6 of this Agreement.
4. REPRESENTATIONS. Borrower represents and warrants that this
Amendment has been duly authorized, executed and delivered by
Borrower and the Credit Agreement, as amended hereby,
constitutes the legal, valid and binding obligation of
Borrower enforceable in accordance with its terms;
2
4
5. CREDIT AGREEMENT IN FULL FORCE AND EFFECT; NO NOVATION. This
Amendment is expressly made supplemental to and a part of the
Credit Agreement and the Credit Agreement is in all respects
ratified and confirmed, and all of the terms, conditions and
provisions thereof, as amended hereby, are and shall continue
to remain in full force and effect. The modifications of the
terms of the Credit Agreement and the execution and delivery
of this Amendment are not intended to constitute, and shall
not be deemed to be, a novation.
6. COUNTERPARTS. This Amendment may be executed in any number of
counterparts, each of which, when executed, are and shall
continue to be an original, but all of which together shall
constitute one and the same instrument.
3
5
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
executed by their respective officers thereunto duly authorized as of the date
first above written.
LENDER BORROWER
------ --------
CREDIT SUISSE FIRST BOSTON CAPTEC NET LEASE REALTY, INC.,
MORTGAGE CAPITAL LLC (as a Michigan corporation
successor to CS First Boston Mortgage
Capital Corp.), a Delaware limited
liability company
By: By: /s/ Xxxx X. Xxxxxx
----------------------------------- -------------------------------
Name: Name: XXXX X. XXXXXX
Title: Title: VICE PRESIDENT
4
6
AMENDMENT TO CREDIT AGREEMENT
-----------------------------
This Amendment ("Amendment") to that certain Credit Agreement dated
February 26, 1996, as previously amended (the "Credit Agreement"), by and
between Captec Net Lease Realty, Inc., a Michigan corporation, as borrower
("Borrower") and Credit Suisse First Boston Mortgage Capital LLC, a Delaware
limited liability company (successor to CS First Boston Mortgage Capital Corp.,
a Delaware corporation), its successors and assigns, as lender ("Lender") is
entered into as of the 2nd day of October, 1997. Capitalized terms used and not
defined herein shall have the meanings attributed to them in the Credit
Agreement.
This Amendment is being entered into for good and valuable
consideration, the sufficiency and receipt of which are hereby acknowledged, and
subject to the following conditions and limitations, the parties hereto hereby
agree to amend the Credit Agreement as follows:
1. SECTION 1(e) Section 1(e) is hereby amended by inserting at
the end thereof the following:
(iv) Borrower agrees to pay to Lender interest on those
certain (i) Revolving Loans and (ii) Loan Assets
which have been and will be funded pursuant to the
Supplementary Loans (defined below) at a rate equal
to twenty-five (25%) percent per annum.
2. SECTION 2(b) Section 2(b) is hereby further amended by
inserting at the end thereof the following:
In addition, Borrower shall be required to repay to Lender all
principal and interest on those certain Revolving Loans and
the Loan Assets which are advanced pursuant to the,
Supplementary Loans (hereinafter the "Expiration Date Payment
Amount") on the date which is the earlier of (i) six (6)
months from the date hereof, or (ii) ten (10) days after the
completion by Borrower of an S.E.C.-registered public offering
of common stock of the Borrower (in accordance with applicable
provisions of the Credit Facility Documents) (the
"Supplemental Expiration Date").
7
3. SECTION 3(e)(ii) Section 3(e)(ii) is hereby amended by
inserting at the end thereof the following:
(ii) Notwithstanding the provisions of the preceding sentence,
prior to the Supplemental Expiration Date, Lender will advance
additional sums to Borrower in excess of the Loan to Value
Requirement (each a "Supplementary Loan"), in an aggregate
amount not to exceed the lesser of: (i) the difference between
100% of the Modified Eligible Borrowing Base (defined herein)
and the Loan to Value Requirement per the Eligible Borrowing
Base or (ii) Eight Million Dollars ($8,000,000).
4. SECTION 7. Section 7 is hereby amended to insert at the end
thereof the following:
(c) Should the Borrower fail to pay the Expiration Date
Payment Amount which is due pursuant to Section 1(e)(iv) at
the Supplemental Expiration Date, then the Lender shall have
the right but not the obligation to purchase ten (10%) percent
of the common stock issued by the Borrower prior to any
S.E.C.-registered public offering of common stock of the
Borrower at the aggregate price of one dollar ($1.00) (the
"Strike Price") in addition to such Expiration Date Payment
Amount. Lender's rights under this Section 7(c) shall expire,
if not exercised, two years after the Supplemental Expiration
Date.
5. MODIFIED ELIGIBLE BORROWING BASE shall mean an amount
(excluding Exempted Loan Investments) equal to the sum of the
following loan asset ("Loan Asset") values: (i) the lesser of:
(A) eighty-five percent (85%) of the Appraised Value of all of
Borrower's Properties not subject to current Improvements or
(B) ninety-five percent (95%) of the capitalized cost of all
of Borrower's Properties not subject to current Improvements;
(ii) seventy-five percent (75%) of the lesser of: (A)
eighty-five percent (85%) of the Appraised Value of all of
Borrower's Properties subject to Improvement Loans or (B)
ninety-five percent (95%) of the budgeted cost of all of
Borrower's Properties subject to Improvement Loans which, as a
fraction of Revolving Loans shall not exceed twenty (20%)
percent thereof in the aggregate; (iii) seventy-one and one
half percent (71.5%) of the outstanding principal amount of
all Loan Investments held by the Borrower as a fraction of
Revolving Loans which shall not exceed 25% in the aggregate,
provided however, in no event shall the value of each Loan
Asset in (i) through (vi) of this Section 6(a)
2
8
includible in the Eligible Borrowing Base exceed the specific
limitation for each such Loan Asset Category, as defined
below, contained therein; (iv) fifty-three and 625/1000
percent (53.625%) of the outstanding principal amount of
Secondary Loan Investments held by the Borrower which shall
not exceed Five Million ($5,000,000) Dollars in the aggregate;
(v) fifty-three and 625/1000 percent (53.625%) of the
outstanding principal amount of Subordinated Loan Investments
held by the Borrower and which shall not exceed Three Million
($3,000,000) dollars in the aggregate; and (vi) seventy-one
and one half percent (71.5%) of the Borrower's net investment
(as defined in the Borrower's annual financial statements) in
all Financing Leases held by Borrower as a fraction of
Revolving Loans which shall not exceed 15% thereof in the
aggregate, LESS the lesser of eighty-five percent (85%) of the
Appraised Value or ninety-five percent (95%) of the
capitalized cost of any Property which is either (A)
encumbered by a superior mortgage or deed of trust in favor of
a party other than Lender of (B) for which a payment is
overdue by a period of sixty (60) days pursuant to a loan held
by Borrower of for which a payment is overdue by a period of
sixty (60) days pursuant to a Lease between Borrower, as
Lessor, and Lessee (each of (i) through (vi) referred to as a
"Loan Asset Category" and collectively as "Loan Asset
Categories"); PROVIDED, HOWEVER, such Modified Eligible
Borrowing Base shall remain in effect subject to receipt by
Lender of (i) a Monthly Loan Asset Performance Information
Report, as defined below; and (ii) a Notice of Borrowing which
shall be accompanied by (A) a Transactional Loan Asset
Performance Information Report, as defined below; and (B) a
certificate, executed by Borrower, in which Borrower (a)
represents and warrants that the creditworthiness of the Loan
Asset is consistent with the Borrower's Underwriting
Guidelines pursuant to Exhibit Q of the Credit Facility; (b)
represents and warrants that no event of default has occurred
and is still occurring with respect to any obligor of Borrower
with respect to any Loan Asset Category except payment
defaults by any obligor of Borrower and which payment defaults
are for a period of less than sixty (60) days and (c)
certifies the accurateness and completeness in all material
respects of the information provided.
6. REPRESENTATIONS. Borrower represents and warrants as follows:
(i) this Amendment has been duly authorized, executed and
delivered by Borrower and the Credit Agreement, as
amended hereby, constitutes the legal, valid and
binding
3
9
obligation of Borrower enforceable in accordance with
its terms;
(ii) the representations and warranties contained in
Section 4 of the Credit Agreement are true and
correct in all material respects as of the date
hereof as if made on the date hereof.
7. CREDIT AGREEMENT IN FULL FORCE AND EFFECT: NO NOVATION. This
Amendment is expressly made supplemental to and a part of the
Credit Agreement and the Credit Agreement is in all respects
ratified and confirmed, and all of the terms, conditions and
provisions thereof, as amended hereby, are and shall continue
to be and remain in full force and effect. The modifications
of the terms of the Credit Agreement and the execution and
delivery of this Amendment are not intended to constitute, and
shall not be deemed to be, a novation.
8. COUNTERPARTS. This Amendment may be executed in any number of
counterparts, each of which, when executed, are and shall
continue to be an original, but all of which together shall
constitute one and the same instrument.
9. TERMINATION. This Amendment shall terminate on the
Supplemental Expiration Date. However, in the event that the
Expiration Date Payment amount shall not be received by Lender
upon the Supplemental Expiration Date, then Lender, in its
sole and absolute discretion, may elect to either (i) continue
to receive interest pursuant to Section 1(e)(iv) on all
outstanding Supplementary Loans, or (ii) declare an Event of
Default under the Credit Facility and the Lender's rights
under Section 7(c) of this Agreement shall survive.
4
10
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
executed by their respective officers thereunto duly authorized as of the date
first above written.
LENDER BORROWER
------ --------
CREDIT SUISSE FIRST BOSTON CAPTEC NET LEASE REALTY, INC.,
MORTGAGE CAPITAL LLC (as a Michigan corporation
successor to CS First Boston Mortgage
Capital Corp.), a Delaware limited
liability company.
By: /s/ Xxxxx Xxxxxxxx By: /s/ Xxxx X. Xxxxxx
------------------------------- ---------------------------------
Name: Xxxxx Xxxxxxxx Name: Xxxx X. Xxxxxx
Title: Director Title: Vice President
