1
Exhibit 99d
FIRST AMENDMENT OF FIXED RATE LOAN AGREEMENT
FIRST AMENDMENT OF FIXED RATE LOAN AGREEMENT (as the same may be amended or
otherwise modified from time to time, the "AMENDMENT"), dated as of the ____ day
of December, 1998, among First Union Real Estate Equity and Mortgage
Investments, as Borrower; BankBoston, N.A., Wellsford Capital and Bankers Trust
Company, as Lenders; and Bankers Trust Company, as Agent.
W I T N E S S E T H:
--------------------
WHEREAS, pursuant to that certain Fixed Rate Loan Agreement as of August
11, 1998 among the parties hereto (as the same may be amended or otherwise
modified from time to time, the "LOAN AGREEMENT"), Lenders made loans to
Borrower in the original aggregate principal amount of Forty-Five Million and
00/100 ($45,000,000.00) Dollars; and
WHEREAS, Borrower and Lenders desire to modify and amend the terms and
provisions of the Loan Agreement as hereinafter provided.
NOW, THEREFORE, in consideration of the covenants set forth herein and for
other good and valuable consideration, the receipt and legal sufficiency of
which is hereby acknowledged, the parties hereto hereby agree as follows:
1. DEFINITIONS. All capitalized terms used herein without definition and which
are defined in the Loan Agreement are used herein with the meanings
assigned to such terms in the Loan Agreement.
2. AMENDMENTS TO LOAN AGREEMENT. The Loan Agreement is hereby modified as
follows:
a. The definition of the Imperial Credit
Facility is hereby amended to include, as
part of the Amended and Restated Credit
Agreement referred to in such definition,
that certain Second Amendment to the Amended
and Restated Credit Agreement dated as of
December ___, 1998, a copy of which is
annexed to this Amendment as EXHIBIT A.
Accordingly, the reference in SECTION
8.1(a)(xii) of the Loan Agreement to the
Prior Debt Documents "as in effect on the
date hereof" (to the extent such reference to the Prior Debt
Documents is a reference to the Imperial Credit Facility) shall
mean the
2
Imperial Credit Facility as in effect after giving
effect to such Second Amendment to the Amended and
Restated Credit Agreement.
b. The definition of Line of Credit Facility is
hereby amended to include, as part of the
Amended and Restated Credit Agreement
referred to in such definition, that certain
Amendment No. 2 dated as of November 24, 1998
to the Amended and Restated Credit Agreement
dated as of November 1, 1997, a copy of which
Amendment No. 2 is annexed to this Amendment
as EXHIBIT B. Accordingly, the references in
SECTIONS 6.1.9 and 7.1.3 of the Loan
Agreement to the Line of Credit Facility "as
in effect on the date hereof" and in SECTION
8.1(a)(xii) of the Loan Agreement to the
Prior Debt Documents "as in effect on the
date hereof" (to the extent such reference to
the Prior Debt Documents is a reference to
the Line of Credit Facility) shall mean the
Line of Credit Facility as in effect after
giving effect to Amendment No. 2.
c. Clause (b) of the definition of "Interest Period" is hereby
amended to read, in its entirety, as follows:
"(b) the final Interest Period shall end on
(and include) August 11, 1999."
d. The definition of Interest Rate is hereby amended to read, in its
entirety, as follows:
"INTEREST RATE" means (i) from the date hereof to and including
November 11, 1998, a rate of interest equal to nine and
seven-eighths percent (9.875%) per annum and (ii) on and after
November 12, 1998, a rate of interest equal to twelve percent
(12%) per annum.
e. The first sentence of SECTION 2.1.4 of the Loan Agreement is
hereby amended to read, in its entirety, as follows:
"The Commitments and the Loans shall be
evidenced by the Notes of Borrower, each in
the original principal amount of the
respective Loans and having a scheduled
maturity date of August 11, 1999."
f. SECTION 2.3.1 of the Loan Agreement is hereby amended to read, in
its entirety, as follows:
2
3
"Borrower shall repay the then outstanding principal amount of the
Loans in full on August 11, 1999, together with interest thereon
through (and including) the last day of the final Interest
Period."
g. SECTION 2.6 of the Loan Agreement and all related definitions are
hereby deleted.
h. All references in the Loan Agreement to the Initial Maturity Date,
the Initial Extension Maturity Date and the Final Extension
Maturity Date shall mean August 11, 1999.
i. SECTION 2.7 of the Loan Agreement is hereby amended to designate
the existing provisions thereof as paragraph (a) and to add the
following as a new SECTION 2.7(b):
"On January 15, 1999, Borrower shall pay to Agent (for the ratable
benefit of Lenders) a non-refundable facility fee of $450,000. If,
on March 31, 1999, the outstanding principal balance of the Loans
is $30,000,000 or more, then on March 31, 1999 Borrower shall pay
to Agent (for the ratable benefit of Lenders) a non-refundable
facility fee of one-half of one percent (.50%) of the then
outstanding principal balance of the Loans. If, on May 31, 1999,
the outstanding principal balance of the Loans exceeds
$15,000,000, then on May 31, 1999 Borrower shall pay to Agent (for
the ratable benefit of Lenders) a non-refundable facility fee of
one percent (1.0%) of the then outstanding principal balance of
the Loans. However, if on May 31, 1999 the outstanding principal
balance of the Loans is less than or equal to $15,000,000, then on
May 31, 1999 Borrower shall pay to Agent (for the ratable benefit
of Lenders) a non-refundable facility fee of one-half of one
percent (.50%) of the then outstanding principal balance of the
Loans. Each of the fees payable pursuant to this SECTION 2.7(b)
shall be payable only if on the date such fee is due Loans are
outstanding. Any repayment of the Loans shall not entitle Borrower
to any refund of any fees or other amounts paid to Lenders.
Borrower's failure to pay, when due, any fee payable pursuant to
this SECTION 2.7(b) shall be an Event of Default."
j. SECTION 8.1(a)(ii) of the Loan Agreement is hereby amended to
read, in its entirety, as follows:
3
4
"(ii) if Borrower fails to pay the
Indebtedness in full on August 11, 1999;"
k. SECTION 8.1(a) (xiv) of the Loan Agreement is hereby amended to
delete the "or" at the end thereof; SECTION 8.1(a)(xv) of the Loan
Agreement is hereby amended to add "or" at the end thereof; and
the following are hereby added to the Loan Agreement as new
SECTIONS 8.1(a)(xvi) and (xvii):
"(xvi) if on March 31, 1999 the
outstanding principal amount of the Loans is
$35,000,000 or more; or
(xvii) if on May 31, 1999 the outstanding principal
balance of the Loans is $25,000,000 or more."
1. SECTIONS 11.2 and 11.3 of the Loan Agreement are hereby deleted
and SECTION 11.1 is hereby amended to read, in its entirety, as
follows:
"Borrower shall use its best efforts to consummate, on or
before each of March 31, 1999 and May 31, 1999 (each, a "Required
Payment Date"), an offering, or offerings, as the case may be
(collectively, the "OFFERING"), pursuant to the Registration
Statement filed by Borrower on September 17, 1998 (Registration
No. 333-63541), as amended from time to time, and such other
registration statements as Borrower shall deem necessary or
appropriate, which entitle(s) holders of equity securities of
Borrower to purchase additional equity securities of Borrower, on
a pro rata basis and which Offering, if fully subscribed, would
provide Borrower with net proceeds, together with any other
Capital Event Proceeds received by Borrower prior to each Required
Payment Date, sufficient to enable Borrower to make
principal payments on account of the Loans and Other Loans such
that no Event of Default will occur under SECTIONS 8.1(a)(xvi) or
(xvii) of the Loan Agreement or SECTIONS 8.1(a)(xvi) or (xvii) of
the Other Loan Agreement. Borrower shall use its best efforts to
take, or cause to be taken, any and all further action or actions
necessary or advisable to be taken in order to consummate the
Offering when and as required by this SECTION 11.1, including but
not limited to the distribution of a prospectus
4
5
or preparation, filing and distribution of any necessary
prospectus supplement with respect to any of the applicable
registration statements referred to above. Without limiting the
foregoing, Borrower shall use its best efforts to commence, on a
timely basis, but in any event no later than sixteen (16) days
prior to each applicable Required Payment Date, an Offering which,
if fully subscribed, would provide the Borrower with net proceeds,
together with any other Capital Event Proceeds received by
Borrower prior to the applicable Required Payment Date, sufficient
to enable Borrower to satisfy such principal amortization
requirements (as previously reduced by other prepayments) under
the Loans and Other Loans due on the applicable Required Payment
Date, and, following the commencement of such Offering, diligently
proceed to consummate such Offering. It shall be an Event of
Default if the Registration Statement filed by Borrower on
September 17, 1998 (Registration No. 333- 6351) is not declared
effective on or prior to February 11, 1999."
3. AMENDMENTS TO NOTES. The first eight (8) lines of SECTION 1 of each Note
are hereby deleted and are replaced with the following:
"FOR VALUE RECEIVED, Borrower hereby promises to pay to the order of
Lender, on or before August 11, 1999 (the "Maturity Date"), the principal
sum of "
4. OUTSTANDING LOANS. Borrower represents and warrants to Lenders that the
outstanding principal amount of the Loans is $45,000,000, that there are no
offsets, defenses or counterclaims to its obligations under the Loan
Documents and, that to the extent that any such offsets, defenses or
counterclaims exist without its knowledge, the same are hereby waived to
the fullest extent permitted by law. Except as modified by this Amendment,
the terms and provisions of the Loan Documents are hereby ratified and
confirmed in all respects and continue in full force and effect.
5. CONSENT OF LENDERS. Concurrently herewith the parties to the Other Loan
Agreement are entering into a First Amendment to Fixed Rate Loan Agreement
(the "OTHER AMENDMENT"), which Other Amendment is, except for the parties
thereto, substantially identical to this Amendment. The Lenders hereby
consent to the execution and
5
6
delivery of the Other Amendment.
6. MODIFICATIONS. No provision of this Amendment may be waived, amended or
supplemented except by a written instrument executed in accordance with
SECTION 9.4 of the Loan Agreement.
7. SUCCESSORS AND ASSIGNS. This Amendment, which sets forth the entire
understanding of the parties hereto with respect to the subject matter
hereof, inures to the benefit of, and shall be binding upon, the parties
hereto and their respective successors and permitted assigns.
8. SEVERABILITY. In the event that any one or more of the provisions contained
in this Amendment shall for any reason be held to be invalid, illegal or
unenforceable in any respect, such invalidity, illegality or
unenforceability shall not affect any other provision of this Amendment,
but this Amendment shall be construed as if such invalid, illegal or
unenforceable provision had never been contained herein.
9. CAPTIONS; COUNTERPARTS; GOVERNING LAW. Captions used in this Amendment are
for convenience of reference only and shall not be deemed a part of this
Amendment nor used in the construction of its meaning. This Amendment may
be signed in any number of counterparts, each of which, when taken
together, shall constitute one and the same Amendment. This Amendment
shall be governed by and construed and enforced in accordance with the laws
of the State of New York applicable to contracts made and to wholly be
performed within such state.
IN WITNESS WHEREOF, the parties hereto have duly executed this
Amendment, as of the date and year first written above.
LENDER AND AGENT:
BANKERS TRUST COMPANY
By:_____________________________
Name:
Title:
LENDERS:
BANKBOSTON, N.A.
6
7
By: ______________________________
Name:
Title:
WELLSFORD CAPITAL
By: ______________________________
Name:
Title:
BORROWER:
FIRST UNION REAL ESTATE EQUITY AND
MORTGAGE INVESTMENTS
By: _______________________________
Name:
Title:
7
