FIRST AMENDMENT TO CREDIT AGREEMENT (this "Agreement")
dated as of March 18, 1998, among ENTERTAINMENT PROPERTIES TRUST,
a real estate investment trust duly organized and validly
existing under the laws of the State of Maryland (the
"Borrower"); EPT DOWNREIT, INC., a corporation duly organized and
validly existing under the laws of the State of Missouri (the
"Subsidiary Guarantor"; and together with the Borrower, the
"Obligors"); each of the lenders that is a signatory hereto
identified under the caption "LENDERS" on the signature pages
hereto (individually, a "Lender" and, collectively, the
"Lenders"); and THE BANK OF NEW YORK, a New York banking
corporation, as administrative agent for the Lenders (in such
capacity, together with its successors in such capacity, the
"Administrative Agent").
RECITALS:
A. The Borrower, the Subsidiary Guarantor, the
Lenders and the Agent are parties to a Credit Agreement dated as
of March 2, 1998 (said Credit Agreement, as so amended and as
same may be further amended, modified and supplemented and in
effect from time to time, being herein called the "Credit
Agreement"; and, except as otherwise herein expressly provided,
all capitalized terms used herein shall have the meaning assigned
to such terms in the Credit Agreement), which Credit Agreement
provides, among other things, for revolving Loans to be made by
the Lenders to the Borrower and Letters of Credit to be issued by
the Issuing Lender on behalf of the Borrower in an aggregate
principal or face amount not exceeding $200,000,000 to finance
the operations of the Obligors for the Permitted Uses.
B. The parties hereto desire to amend the Credit
Agreement in accordance with that certain letter agreement dated
as of March 2, 1998 among the parties hereto.
NOW, THEREFORE, for good and valuable consideration,
the receipt and sufficiency of which is hereby acknowledged, the
parties hereto agree as follows:
Section 1. Amendment of Credit Agreement. The
Credit Agreement is hereby deemed amended as follows:
(a) The definitions of "Applicable Margin", "Total
Indebtedness" and "Total Market Value of Real Estate" in Section
1.01 of the Credit Agreement are hereby deleted in their entirety
and replaced with the following definitions:
""Applicable Margin" means, with respect to any Base
Rate Loan or Eurodollar Loan, or with respect to the
commitment fees payable hereunder, as the case may be,
during any Interest Accrual Period (as defined below), the
rate per annum set forth below under the caption "Base Rate
Margin", "Eurodollar Margin" or "Commitment Fee Rate",
respectively, based on the Total Leverage Ratio for such
Interest Accrual period:
Total Leverage Base Rate Eurodollar Commitment
Ratio: Loan Margin Loan Margin Fee Rate
>30% 0.500% 1.750% 0.25%
<30% 0.375% 1.625% 0.20%
Notwithstanding the foregoing, in the event the
Borrower obtains an investment grade rating from either S&P or
Xxxxx'x, (a) the Applicable Margins for Base Rate Loans and
Eurodollar Loans will be reduced by 0.25% (but not below 0) and
(b) the commitment fee rate will be reduced to 0.175%.
For purposes hereof, an "Interest Accrual Period" means
(i) initially, the period commencing on the Effective Date to but
not including the Quarterly Date falling on or nearest to
March 31, 1998, and (ii) thereafter, the period commencing on a
Quarterly Date to but not including the immediately following
Quarterly Date. The Total Leverage Ratio for the initial
Interest Accrual Period shall be determined on the basis of the
certificate of a Financial Officer of the Borrower delivered
pursuant to Section 7.01(h). The Total Leverage Ratio for any
Interest Accrual Period after the initial Interest Accrual Period
shall be determined on the basis of a certificate of a Financial
Officer of the Borrower setting forth a calculation of the Total
Leverage Ratio as at the last day of the fiscal quarter
immediately preceding such Interest Accrual Period (i.e., the
Total Leverage Ratio for the Interest Accrual Period commencing
April 1, 1998 shall be determined on the basis of the Total
Leverage Ratio as at March 31, 1998, the Total Leverage Ratio for
the Interest Accrual Period commencing July 1, 1998 shall be
determined on the basis of the Total Leverage Ratio as at
June 30, 1998, and so forth), each of which certificates shall be
delivered together with the financial statements for the fiscal
quarter on which such calculation is based.
Anything in this Agreement to the contrary
notwithstanding, the Applicable Margin for Base Rate Loans,
Eurodollar Loans and commitment fees shall be the highest rate
per annum provided for above (i.e., 0.500% with respect to Base
Rate Loans, 1.750% with respect to Eurodollar Loans and 0.25%
with respect to commitment fees) (A) during any period when an
Event of Default shall have occurred and be continuing, including
the determining of the Post-Default Rate, or (B) if a certificate
of a Financial Officer of the Borrower shall not be delivered as
provided above prior to the beginning of any Interest Accrual
Period, for such period commencing on the first day of such
Interest Accrual Period and ending on the date of delivery of
such certificate."
""Total Indebtedness" means, as at any date, the sum,
for the Borrower and its Subsidiaries (determined on a
consolidated basis without duplication in accordance with
GAAP), of the following: (a) all Indebtedness (including,
without limitation, the aggregate amount of Loans and Letter
of Credit Liabilities under this Agreement) and (b) all
other liabilities that should be classified as liabilities
on a balance sheet, including, without limitation, all
reserves (other than general contingency reserves) and all
deferred taxes and other deferred items, but excluding
(i) dividends declared but not yet paid and (ii) trade
payables in the ordinary course of business so long as such
trade payables are payable within 90 days after the date of
the original invoice therefor."
""Total Market Value of Real Estate" means, as of any
date, (a) Net Operating Income for the Borrower's most
recently completed fiscal quarter (less maintenance capital
expenditures) multiplied by (b) four and divided by (c) a
capitalization rate of 10.75%; provided, however, all real
properties that are leased to lessees whose consolidated net
worth, or the consolidated net worth of their respective
guarantors, is less than $25,000,000 shall be capitalized at
a rate of 12.5%; and in the absence of historical financial
information, pro forma financial information shall be used
for the first quarter in the first year of the applicable
lease."
(b) Section 9.10(c) of the Credit Agreement is hereby
deleted in its entirety and replaced with the following
subparagraph (c):
"(c) Maximum Non-Recourse Secured Leverage Ratio. As
at the end of each fiscal quarter, the Non-Recourse Secured
Leverage Ratio shall not exceed 25% at any time."
(c) The text of item no. 9 in Section III(a) and the
text of item no. 10 in Section IV(a) of the form of Borrowing
Base Certificate attached as Exhibit B of the Credit Agreement
are hereby deleted in their entirety and replaced with the
following language in both such sections:
"Other Balance Sheet Liabilities (excluding
trade payables not more than 90 days old and
dividends payable)"
(d) The table set forth in Section IV(b) of the form
of Borrowing Base Certificate attached as Exhibit B to the Credit
Agreement is hereby deleted in its entirety and replaced with the
following table:
Quarterly Total
Net Capital Capital- Market
Real Estate Operating Improvement ization Owner- Value of
Properties Income Reserve Rate ship % Real Estate
[List each
Real Estate
Property] $ $ ___% ___% $
TOTAL MARKET VALUE OF REAL ESTATE $___________
(e) Sections VII and VIII of the form of Borrowing
Base Certificate attached as Exhibit B to the Credit Agreement
are hereby deleted in their entirety and replaced with the
following:
"VII. FIXED CHARGES RATIO (Section 9.10(e)):
As at the end of [INSERT LAST DATE OF MOST RECENT
FISCAL QUARTER], the Fixed Charges Ratio was ___ to 1,
based on the following computations:
(a) EBITDA, as computed below:
Real Estate Quarterly
Properties EBITDA
[List each Real
Estate Property] $__________
TOTAL $__________
(b) Total Fixed Charges for such quarter: $
(i) Debt Service: $
(A) [ITEMIZE PRINCIPAL
PAYMENTS]
(B) [ITEMIZE INTEREST
EXPENSE BEFORE
SUBTRACTING
INTEREST INCOME] $
(ii) Capital Improvement Reserves $
(iii) Preferred dividends $_______
Subtotal $
(iv) Less interest income ($______)
TOTAL $
VIII. INTEREST COVERAGE RATIO (Section 9.10(f)):
As at the end of [INSERT LAST DATE OF MOST RECENT
FISCAL QUARTER], the Interest Coverage Ratio was ___ to 1,
based on the following computations:
(a) EBITDA (see total quarterly EBITDA
computation in Section VII (a) above) $
(b) Interest Expense for such quarter,
computed as follows: $
(i) Interest Expense for such quarter
(see computations in
SectionVII(b)(i)(B) above) $
(ii) Less interest income for such
quarter ($______)
TOTAL NET
INTEREST EXPENSE $
Section 2. Obligor Representations. Each of the
Obligors hereby represents and warrants to the Agent and the
Lenders as follows:
(a) Each of the representations and warranties of the
Obligors contained or incorporated in the Credit Agreement,
as amended by this Agreement, or any of the other Loan
Documents, are true and correct in all material respects on
and as of the date hereof (except if any such representation
or warranty is expressly stated to have been made as of a
specific date, then as of such specific date);
(b) As of the date hereof and immediately after giving
effect to this Agreement and the actions contemplated
thereby, no Default shall have occurred and be continuing;
and
(c) Each Obligor has all necessary real estate
investment trust or corporate, as applicable, power and
authority to execute, deliver and perform its obligations
under this Agreement; each Obligor of this Agreement has
been duly authorized by all necessary real estate investment
trust or corporate, as applicable, action on its part; and
this Agreement has been duly and validly executed and
delivered by each Obligor and constitutes each Obligor's
legal, valid and binding obligation, enforceable in
accordance with their respective terms, except as such
enforceability may be limited by (a) bankruptcy, insolvency,
reorganization, moratorium or similar laws of general
applicability affecting the enforcement of creditors' rights
and (b) the application of general principles of equity
(regardless of whether such enforceability is considered in
a proceeding in equity or at law).
Section 3. Ratification. Except as modified
herein, all of the Loan Documents are hereby ratified and
confirmed on behalf of the parties hereto.
Section 4. Miscellaneous.
(a) GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED
BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF
NEW YORK.
(b) Amendments, Etc. The terms of this Agreement may
be waived, modified and amended only by an instrument in writing
duly executed by the Borrower and the Agent (with any required
consent of the Lenders pursuant to the Credit Agreement). Any
such waiver, modification or amendment shall be binding upon each
Obligor, the Agent, each Lender and each holder of any of the
Notes.
(c) Successors and Assigns. This Agreement shall be
binding upon and inure to the benefit of the respective
successors and assigns of the Obligors, the Agent, the Lenders
and any holder of any of the Notes (provided, however, that
(a) no Obligor shall assign or transfer its rights or obligations
hereunder except as provided in Section 12.06(a) of the Credit
Agreement and (b) any assignment by the Lenders shall be subject
to the terms of Section 12.06(b) of the Credit Agreement).
(d) Captions. The captions and section headings
appearing herein are included solely for convenience of reference
and are not intended to affect the interpretation of any
provision of this Agreement.
(e) Counterparts. This Agreement may be executed in
any number of counterparts, all of which taken together shall
constitute one and the same instrument and either of the parties
hereto may execute this Agreement by signing any such
counterpart.
(f) Severability. If any provision hereof is invalid
and unenforceable in any jurisdiction, then, to the fullest
extent permitted by law, (a) the other provisions hereof shall
remain in full force and effect in such jurisdiction and shall be
liberally construed in favor of the Agent and the Lenders in
order to carry out the intentions of the parties hereto as nearly
as may be possible and (b) the invalidity or unenforceability of
any provision hereof in any jurisdiction shall not affect the
validity or enforceability of such provision in any other
jurisdiction.
[Signature pages follow]
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed and delivered as of the day and
year first above written.
BORROWER
ENTERTAINMENT PROPERTIES TRUST
By___________________________
Name:
Title:
SUBSIDIARY GUARANTORS
EPT DOWNREIT, INC.
By___________________________
Name:
Title:
LENDERS
THE BANK OF NEW YORK
By___________________________
Name:
Title:
THE BANK OF NOVA SCOTIA,
NEW YORK AGENCY
By_____________________
Name:
Title:
XXXXXXX SACHS MORTGAGE COMPANY
Xxxxxxx Xxxxx Real Estate Funding
Corp., its General Partner
By_______________________
Name:
Title:
BANK LEUMI USA
By______________________
Name:
Title:
ADMINISTRATIVE AGENT
THE BANK OF NEW YORK,
as Administrative Agent
By__________________________
Name:
Title:
