EXHIBIT 4.1
CREDIT AGREEMENT
THIS CREDIT AGREEMENT (the "Agreement") is made as of the 20th day of
April, 1999, by and between APPLE SUITES, INC., a Virginia corporation (the
"Company"), and FIRST UNION NATIONAL BANK, a national banking corporation (the
"Lender").
STATEMENT OF PURPOSE
The Company has requested the Lender to extend to the Company a loan to
fund the start-up costs and the Lender has agreed to do so on the terms and
subject to the conditions set forth herein. All capitalized terms not otherwise
defined herein are defined in Paragraph 9 hereof.
Now, therefore, for good and valuable consideration, the receipt and
adequacy of which are hereby acknowledged, the parties hereto agree as follows:
AGREEMENT
1. Credit Facility.
1(a) Loan. Subject to the conditions set forth herein, the Lender
agrees that it shall advance $1,000,000.00 (the "Loan") to the Company. Advances
of Loan proceeds will be made upon the written request of the Company; provided,
however, no more than three (3) such requests shall be made and all such
requests must be made on or before June 19, 1999. No amount repaid by the
Company prior to the Maturity Date may be reborrowed by the Company.
1(b) Interest Rate. The Loan shall bear interest at a rate equal to
the LIBOR-Based Rate.
1(c) Payment of Interest. The Company shall pay to the Lender interest
on the outstanding principal balance of the Loan from the date disbursed to but
not including the date of payment in full, such interest to be payable monthly,
in arrears, as provided in Paragraph 2(c) below.
1(d) Inability to Determine Rate. If the Lender determines (which
determination shall be conclusive and binding upon the Company) that by reason
of circumstances affecting the London interbank eurodollar market adequate and
reasonable means do not exist for ascertaining the LIBOR-Based Rate at any time,
the Lender shall forthwith give facsimile notice of such determination,
confirmed in writing, to the Company. If such notice is
given the Loan shall bear interest at a rate determined by Lender to
approximate, as nearly as possible, the LIBOR-Based Rate. The Lender shall
withdraw such notice in the event that the circumstances giving rise thereto no
longer obtain and that adequate and reasonable means exist for ascertaining the
LIBOR-Based Rate, and following withdrawal of such notice by the Lender, the
Loan shall again earn interest at the LIBOR-Based Rate in accordance with the
terms and conditions of this Agreement.
1(e) Requirements of Law; Increased Costs. In the event that any
change subsequent to the date hereof in any applicable law, order, regulation,
treaty or directive issued by any central bank or other Governmental Authority,
or in the governmental or judicial interpretation or application thereof, or
compliance by the Lender with any request or directive (whether or not having
the force of law) by any central bank or other Governmental Authority:
(1) subjects the Lender to any tax of any kind whatsoever with
respect to this Agreement or the Loan made hereunder, or changes the basis
of taxation of payments to the Lender of principal, fee, interest or any
other amount payable hereunder (except for change in the rate of tax on the
overall net income of the Lender);
(2) imposes, modifies or holds applicable any reserve, capital
requirement, special deposit, compulsory loan or similar requirements
against assets held by, or deposits or other liabilities in or for the
account of, advances or loans by, or other credit extended by, or any other
acquisition of funds by, any office of the Lender which are not otherwise
included in the determination of the LIBOR-Based Rate; or
(3) imposes on the Lender any other condition;
and the result of any of the foregoing is to increase the cost to the Lender of
making, renewing or maintaining the Loan or to reduce any amount receivable in
respect thereof or to reduce the rate of return on such capital of the Lender or
any Person controlling the Lender, then, in any such case, the Company shall
promptly pay to the Lender, upon written demand by the Lender, any additional
amounts necessary to compensate such Lender for such additional cost or reduced
amounts receivable or rate of return as determined by such Lender with respect
to this Agreement or the Loan made hereunder. If the Lender becomes entitled to
claim any additional amounts pursuant to this Paragraph 1(e), it shall promptly
notify the Company of the event by reason of which it has become so entitled. A
certificate as to any additional amounts payable pursuant to the foregoing
sentence containing the calculation thereof in reasonable detail submitted by
the Lender to the Company shall be conclusive in the absence of manifest error.
The provisions hereof shall survive the termination of this Agreement and
payment of the outstanding Loan and all other amounts payable hereunder.
1(f) Funding. The Lender shall be entitled to fund all or any portion
of the Loan in any manner it may determine in its sole discretion, but all
calculations and transactions hereunder shall be conducted as though the Lender
actually funds the Loan through the purchase in London of offshore dollar
deposits in the amount of the Loan.
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2. Miscellaneous Lending Provisions.
2(a) Use of Proceeds. The proceeds of the Loan shall be used by the
Company solely for the purpose of funding start-up costs.
2(b) Note. The obligations of the Company to repay the Loan shall be
evidenced by a note payable to the order of the Lender in the form attached
hereto as Exhibit A (the "Note").
2(c) Interest and Fee Billing and Payment. The Lender shall, on or
before the fifth Business Day of each month, deliver to the Company an interest
and fee billing for the immediately preceding month, which billing shall set
forth interest accrued and payable on the Loan and fees payable hereunder for
such month and which billing shall be payable no later than the second Business
Day following receipt thereof by the Company.
2(d) Repayment of Principal. The Company shall pay the principal
amount of the Loan and any accrued and unpaid interest on the Maturity Date.
2(e) Nature and Place of Payments. All payments made on account of the
Obligations shall be made without set-off or counterclaim in lawful money of the
United States of America in immediately available same day funds, free and clear
of and without deduction for any taxes, fees or other charges of any nature
whatsoever imposed by any taxing authority upon the Lender and if received by
the Lender by 2:00 p.m. (Charlotte, North Carolina time) such payment will be
credited on the Business Day received. If a payment is received after 2:00 p.m.
(Charlotte, North Carolina time) by the Lender, such payment will be credited on
the next succeeding Business Day and interest thereon shall be payable at the
then applicable rate until credited. If any payment required to be made by the
Company hereunder becomes due and payable on a day other than a Business Day,
the due date thereof shall be extended to the next succeeding Business Day and
interest thereon shall be payable at the then applicable rate during such
extension.
2(f) Post-Maturity Interest. Any Obligations not paid when due
(whether at stated maturity, upon acceleration or otherwise) shall bear interest
from the date due until paid in full at a per annum rate equal to four percent
(4%) above the interest rate otherwise applicable thereto, or, if such
Obligations do not otherwise bear interest, four percent (4%) above the
LIBOR-Based Rate.
2(g) Computations. All computations of interest and fees payable
hereunder shall be based upon a year of 360 days for the actual number of days
elapsed.
2(h) Prepayments.
(1) The Company may voluntarily prepay Loans hereunder in whole
or in part at any time.
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(2) The Company shall pay in connection with any prepayment
hereunder all interest accrued but unpaid on the Loan to which such
prepayment is applied concurrently with payment of any principal amounts.
2(i) Fees. The Company shall pay the following fees: (i) an upfront
fee of $5,000 to Lender upon Closing.
3. Conditions to Making of the Loan. As conditions precedent to the
Lender's obligation to make the Loan hereunder:
(1) The Company shall have delivered to the Lender, in form and
substance satisfactory to the Lender and its counsel each of the following:
(i) A duly executed copy of this Agreement;
(ii) A duly executed copy of the Note;
(iii) A copy of the Guaranty duly executed by the Guarantor;
(iv) Such credit applications, financial statements,
authorizations and such information concerning the Company and its
businesses, operations and conditions (financial and otherwise) as the
Lender may reasonably request;
(v) Certified copies of resolutions of the Board of Directors of
the Company approving the execution and delivery of the Credit Documents,
the performance of the Obligations thereunder and the consummation of the
transactions contemplated thereby;
(vi) A certificate of the Secretary or an Assistant Secretary of
the Company certifying the names and true signatures of the officers of the
Company authorized to execute and deliver the Credit Documents;
(vii) A copy of the Articles of Incorporation of the Company
certified by the Secretary or an Assistant Secretary of the Company as of
the date of this Agreement as being accurate and complete;
(viii) A copy of the Bylaws of the Company certified by the
Secretary or an Assistant Secretary of the Company as of the date of this
Agreement as being accurate and complete;
(ix) A certificate of the Secretary of State of the State of
Virginia, certifying as of a recent date that the Company is in good
standing
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(2) All acts and conditions (including, without limitation, the
obtaining of any necessary regulatory approvals and the making of any
required filings, recordings or registrations) required to be done and
performed and to have happened precedent to the execution, delivery and
performance of the Credit Documents and to constitute the same legal, valid
and binding obligations, enforceable in accordance with their respective
terms, shall have been done and performed and shall have happened in due
and strict compliance with all applicable laws.
(3) All documentation, including, without limitation,
documentation for corporate and legal proceedings in connection with the
transactions contemplated by the Credit Documents shall be satisfactory in
form and substance to the Lender and its counsel, and all legal and
financial due diligence on the Company and its operation and conditions
shall be completed and shall be satisfactory to Lender and its counsel.
(4) All fees required to be paid on or before the date hereof
pursuant to Paragraph 2(i) above shall have been paid prior to (or will be
paid concurrently with) the making of the Loan hereunder.
4. Representations and Warranties of the Company.
The Company represents and warrants to the Lender that:
4(a) Corporate Existence; Compliance with Law. The Company: (1) is
duly organized, validly existing and in good standing as a corporation under the
laws of Virginia and is qualified to do business in each other jurisdiction
where its ownership of property or conduct of business requires such
qualification and where failure to qualify could have a material adverse effect
on the Company or its property or business or on the ability of the Company to
pay or perform the Obligations, (2) has the corporate power and authority and
the legal right to own and operate its property and to conduct business in the
manner in which it does and proposes so to do, and (3) is in compliance with all
Requirements of Law and Contractual Obligations, the failure to comply with
which could have a material adverse effect on the business, operations, assets
or financial or other condition of the Company.
4(b) Corporate Power; Authorization; Enforceable Obligations The
Company has the corporate power and authority and the legal right to execute,
deliver and perform the Credit Documents and has taken all necessary corporate
action to authorize the execution, delivery and performance of the Credit
Documents. The Credit Documents have been duly executed and delivered on behalf
of the Company and constitute legal, valid and binding obligations of the
Company enforceable against the Company in accordance with their respective
terms, subject to the effect of applicable bankruptcy and other similar laws
affecting the rights of creditors generally and the effect of equitable
principles whether applied in an action at law or a suit in equity.
4(c) Investment Companies Act. The Company is not an "investment
company" or a company "controlled" by an "investment company" within the meaning
of the Investment Company Act of 1940, as amended.
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4(d) Federal Reserve Board Regulations. The Company is not engaged,
and will not engage, principally or as one of its important activities, in the
business of extending credit for the purpose of "purchasing" or "carrying" any
"margin stock" within the respective meanings of such terms under Regulation U.
No part of the proceeds of the Loan issued hereunder will be used, directly or
indirectly, for "purchasing" or "carrying" "margin stock" as so defined or for
any purpose which violates, or which would be inconsistent with, the provisions
of the Regulations of the Board of Governors of the Federal Reserve System.
4(e) Ownership and Subsidiaries. As of the date hereof, the
outstanding stock of the Company is owned by Parent, and the Company has no
subsidiaries.
5. Affirmative Covenants. The Company hereby covenants and agrees with the
Lender that, as long as any Obligations remain unpaid, the Company shall:
5(a) Payment of Indebtedness. Pay or otherwise satisfy at or before
maturity or before it becomes delinquent or accelerated, as the case may be, all
its Indebtedness (including taxes), except Indebtedness being contested in good
faith by appropriate proceedings and for which provision is made to the
satisfaction of the Lender for the payment thereof in the event any Company is
found to be obligated to pay such Indebtedness and which Indebtedness is
thereupon promptly paid by such Company.
5(b) Maintenance of Existence and Properties. Maintain its corporate
existence and obtain and maintain all rights, privileges, licenses, approvals,
franchises, properties and assets necessary or desirable in the normal conduct
of its business.
5(c) Inspection of Property; Books and Records; Audits.
(1) Keep proper books of record and account in which full, true
and correct entries in conformity with GAAP and all Requirements of Law
shall be made of all dealings and transactions in relation to its business
and activities; and
(2) Permit: (i) representatives of the Lender, to (A) visit and
inspect any of its properties and examine and make abstracts from any of
its books and records at any reasonable time and as often as may reasonably
be desired by the Lender, (but, prior to the occurrence of an Event of
Default, only upon not less than two Business Days' prior notice), and (B)
discuss the business, operations, properties and financial and other
condition of the Company with officers and employees of the Company, and
with the independent certified public accountants of the Company, and (ii)
representatives of the Lender to conduct periodic operational audits of the
Company's business and operations of the Company.
5(d) Notices. Promptly give written notice to the Lender of:
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(1) The occurrence of any Potential Default or Event of Default
known to responsible management personnel of the Company and the proposed
method of cure thereof;
(2) Any litigation or proceeding affecting the Company which
could have a material adverse effect on the business, operations, property,
or financial or other condition of the Company;
(3) A material adverse change known to responsible management
personnel of the Company in the business, operations, property or financial
or other condition of any Company;
(4) A default under the terms of any Indebtedness to which the
Company is a party (whether or not such default gives rise to the right of
the affected lender to accelerate such Indebtedness); and
(6) Any violation of any Requirements of Law or Contractual
Obligations to which the Company may be subject or a party.
5(e) Expenses. Pay all reasonable out-of-pocket costs and expenses
(including fees and disbursements of legal counsel): (1) of the Lender incident
to the preparation, negotiation and administration of the Credit Documents,
including with respect to or in connection with any waiver or amendment thereof
or thereto, (2) of the Lender associated with any periodic audits conducted
pursuant to Paragraph 5(d)(2)(ii) above, and (3) of the Lender incident to the
enforcement of payment of the Obligations, whether by judicial proceedings or
otherwise, including, without limitation, in connection with bankruptcy,
insolvency, liquidations reorganization moratorium or other similar proceedings
involving the Company or a "workout" of the Obligations. The obligations of the
Company under this Paragraph 5(f) shall survive payment of all other
Obligations.
5(f) Credit Documents. Comply with and observe all terms and
conditions of the Credit Documents.
5(g) Insurance. Obtain and maintain insurance with responsible
companies in such amounts and against such risks as are usually carried by
corporations engaged in similar businesses similarly situated, including,
without limitation, errors and omissions coverage and fidelity coverage in form
and substance acceptable to the Lender, and furnish the Lender on request full
information as to all such insurance, and to provide within five (5) days after
receipt, certificates or other documents evidencing the renewal of each such
policy.
5(h) Year 2000 Compatibility. The Company shall take all action
necessary to assure that the Company's computer-based systems are able to
operate and effectively process data including dates on or after January 1,
2000. At the request of the, the Company shall provide the Lender assurance
acceptable to the Lender of the Company's Year 2000 compatibility.
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6. Negative Covenants. The Company hereby agrees that, as long as any
Obligations remain unpaid, the Company shall not at any time, directly or
indirectly:
6(a) Consolidation and Merger; Change of Business. Liquidate or
dissolve or enter into any consolidation or merger or enter into any
partnership, joint venture, syndicate or other combination or make any change in
the nature of its business as presently conducted.
7. Events of Default. Upon the occurrence of any of the following events
(an "Event of Default"):
7(a) The Company shall fail to pay principal or interest on the Loan
or any fee payable pursuant to Paragraph 2(i) above when due; or
7(b) Any representation or warranty made or deemed made by the Company
in any Credit Document or in connection with any Credit Document shall be
inaccurate or incomplete in any material respect on or as of the date made or
deemed made; or
7(c) The Company shall fail to maintain its corporate existence or
shall default in the observance or performance of any covenant or agreement
contained in Paragraph 6; or
7(d) Xxxxx X. Xxxxxx is no longer serving as Chairman of the Board and
President of the Company; or
7(e) The Company shall fail to observe or perform any other term or
provision contained in the Credit Documents and such failure shall continue for
thirty (30) days; or
7(f) The Company shall default in any payment of principal of or
interest on any Indebtedness in the aggregate principal amount of $100,000 or
more (and without regard for the dollar amount of the defaulted payment), or any
other event shall occur, the effect of which is to permit such Indebtedness to
be declared or otherwise to become due prior to its stated maturity; or
7(g) (1) The Company or the Parent shall commence any case, proceeding
or other action (i) relating to bankruptcy, insolvency, reorganization or relief
of debtors, seeking to have an order for relief entered with respect to the
Company or the Parent, or seeking to adjudicate the Company or the Parent a
bankrupt or insolvent, or seeking reorganization, arrangement, adjustment,
winding-up, liquidation, dissolution, composition or other relief with respect
to the Company or the Parent or the debts of either of them, or (ii) seeking
appointment of a receiver, trustee, custodian or other similar official for the
Company or the Parent or for all or any substantial part of the assets of the
Company or the Parent, or the Company or the Parent shall make a general
assignment for the benefit of its creditors; or (2) there shall be commenced
against the Company or the Parent any case, proceeding or other action of a
nature referred to in clause (1) above which (i) results in the entry of an
order for relief or any such adjudication or appointment, or (ii) remains
undismissed, undischarged or unbonded for a period of sixty (60) days; or (3)
there shall be commenced against the Company or the Parent any case, proceeding
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or other action seeking issuance of a warrant of attachment, execution,
distraint or similar process against all or substantially all of the assets of
either of them which results in the entry of an order for any such relief which
shall not have been vacated, discharged, stayed, satisfied or bonded pending
appeal within sixty (60) days from the entry thereof; or (4) the Company or the
Parent shall take any action in furtherance of, or indicating its consent to,
approval of, or acquiescence in (other than in connection with a final
settlement), any of the acts set forth in clauses (1), (2) or (3) above; or (5)
the Company or the Parent shall generally not, or shall be unable to, or shall
admit in writing its inability to pay its debts as they become due; or
7(h) One or more judgments or decrees in an aggregate amount in excess
of $100,000 shall be entered against the Company and all such judgments or
decrees shall not have been vacated, discharged, stayed, satisfied or bonded
pending appeal within sixty (60) days from the entry thereof; or
THEN:
(1) Automatically upon the occurrence of an Event of Default
under Paragraph 7(g) above; and
(2) In all other cases, at the option of the Lender;
the principal balance of outstanding Loan and interest accrued but unpaid
thereon shall become immediately due and payable, without demand upon or
presentment to the Company, which are expressly waived by the Company.
8. Miscellaneous Provisions.
8(a) Assignment. The Company may not assign its rights or obligations
under this Agreement without the prior written consent of the Lender. Subject to
the foregoing, all provisions contained in this Agreement or any document or
agreement referred to herein or relating hereto shall inure to the benefit of
the Lender, and its successors and assigns, and shall be binding upon the
Company, and its successors and assigns.
8(b) Amendment. Neither this Agreement nor any of the other Credit
Documents may be amended or terms or provisions hereof or thereof waived unless
such amendment or waiver is in writing and signed by the Lender and the Company.
8(c) Cumulative Rights; No Waiver. The rights, powers and remedies of
the Lender under the Credit Documents are cumulative and in addition to all
rights, powers and remedies provided under any and all agreements among the
Company and the Lender relating hereto, at law, in equity or otherwise. Any
delay or failure by the Lender to exercise any right, power or remedy shall not
constitute a waiver thereof by the Lender, and no single or partial
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exercise by the Lender of any right, power or remedy shall preclude other or
further exercise thereof or any exercise of any other rights, powers or
remedies.
8(d) Entire Agreement. This Agreement and the documents and agreements
referred to herein embody the entire agreement and understanding between the
parties hereto and supersede all prior agreements and understandings relating to
the subject matter hereof and thereof.
8(e) Survival. All representations, warranties, covenants and
agreements on the part of the Company contained in the Credit Documents shall
survive the termination of this Agreement and shall be effective until the
Obligations are paid and performed in full or longer as expressly provided
herein.
8(f) Notices. All notices given by any party to the others under the
Credit Documents shall be in writing unless otherwise provided for herein,
delivered personally or by depositing the same in the United States mail,
registered, with postage prepaid, addressed to the party at the address set
forth on Schedule I attached hereto. Any party may change the address to which
notices are to be sent by notice of such change to each other party given as
provided herein. Such notices shall be effective on the date received or, if
mailed, on the third Business Day following the date mailed.
8(g) Governing Law/Waiver of Jury Trial. This Agreement shall be
governed by and construed in accordance with the laws of the State of North
Carolina. TO THE EXTENT PERMITTED BY LAW, THE COMPANY HEREBY KNOWINGLY,
VOLUNTARILY AND INTENTIONALLY WAIVES ANY RIGHTS IT MAY HAVE TO A TRIAL BY JURY
IN RESPECT OF ANY LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER OR IN
CONNECTION WITH THE CREDIT DOCUMENTS. THIS PROVISION IS A MATERIAL INDUCEMENT
FOR THE LENDER ENTERING INTO THE CREDIT DOCUMENTS.
8(h) Counterparts. This Agreement and the other Credit Documents may
be executed in any number of counterparts, all of which together shall
constitute one agreement.
8(i) Binding Arbitration. Upon demand of any party hereto, whether
made before or after institution of any judicial proceeding, any dispute, claim
or controversy arising out of, connected with or relating to the Note or any
other Credit Document ("Disputes"), between or among parties to the Note or any
other Credit Document shall be resolved by binding arbitration as provided
herein. Institution of a judicial proceeding by a party does not waive the right
of that party to demand arbitration hereunder. Disputes may include, without
limitation, tort claims, counterclaim, claims brought as class actions, claims
arising from Credit Documents executed in the future, or claims concerning any
aspect of the past, present or future relationships arising out of or connected
with the Credit Documents. Arbitration shall be conducted under and governed by
the Commercial Financial Disputes Arbitration Rules (the "Arbitration Rules") of
the American Arbitration Association and Title 9 of the U.S. Code. All
arbitration hearings shall be conducted in Charlotte, North Carolina. The
expedited procedures set forth in Rule 51, et seq. of the Arbitration Rules
shall be applicable to claims of less than $1,000,000. All applicable
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statutes of limitation shall apply to any Dispute. A judgment upon the award may
be entered in any court having jurisdiction. The panel from which all
arbitrators are selected shall be comprised of licensed attorneys. The single
arbitrator selected for expedited procedure shall be a retired judge from the
highest court of general jurisdiction, state or federal, of the state where the
hearing will be conducted. Notwithstanding the foregoing, this paragraph shall
not apply to any hedging arrangement that is a Credit Document.
9. Definitions. For purposes of this Agreement, the terms set forth below
shall have the following meanings:
"Affiliate" shall mean, as to any Person, any other Person directly or
indirectly controlling, controlled by or under direct or indirect common control
with, such Person. "Control" as used herein means the power to direct the
management and policies of such Person.
"Agreement" shall mean this Agreement, as the same may be amended, extended
or replaced from time to time.
"Business Day" shall mean any day other than a Saturday, a Sunday or a day
on which banks in Charlotte, North Carolina are authorized or obligated to close
their regular banking business.
"Company" shall have the meanings given such terms in the introductory
paragraph hereof.
"Contractual Obligation" as to any Person shall mean any provision of any
security issued by such Person or of any agreement, instrument or undertaking to
which such Person is a party or by which it or any of its property is bound.
"Credit Documents" shall mean this Agreement and the Note and each other
document, instrument and agreement executed by the Company in connection
herewith, as any of the same may be amended, extended or replaced from time to
time.
"Eurodollar Rate" shall mean the arithmetic average of the rates at which
deposits in immediately available U.S. dollars in an amount equal to the
aggregate amount of Eurodollar Loans proposed to be subject to such rates having
a maturity approximately equal to six (6) months are offered to or by banks in
the London interbank market, as determined by the Lender in accordance with its
standard practices and calculated by the Lender on each Business Day during the
term of this Agreement, it being understood that the Eurodollar Rate may change
from day to day based on the Lender's determination of the Eurodollar Rate as
provided above, said changes to be effective as of the date of determination of
the Eurodollar Rate by the Lender.
"Event of Default" shall have the meaning set forth in Paragraph 7 above.
"GAAP" shall mean generally accepted accounting principles in the United
States of America in effect from time to time.
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"Governmental Authority" shall mean any nation or government, any state or
other political subdivision thereof, or any entity exercising executive,
legislative, judicial, regulatory or administrative functions of or pertaining
to government.
"Guarantor" shall mean Xxxxx X. Xxxxxx.
"Guaranty" shall mean the Guaranty of even date herewith executed by
Guarantor for the benefit of Lender as same may be amended from time to time.
"Indebtedness" of any Person shall mean all items of indebtedness which, in
accordance with GAAP and practices thereof, would be included in determining
liabilities as shown on the liability side of a statement of condition of such
Person as of the date as of which indebtedness is to be determined, including:
without limitation, all obligations for money borrowed, all amounts for which
such Person may be obligated under gestation or other repurchase facilities, and
shall also include all indebtedness and liabilities of others assumed or
guaranteed by such Person or in respect of which such Person is secondarily or
contingently liable (other than by endorsement of instruments in the course of
collection) whether by reason of any agreement to acquire such indebtedness or
to supply or advance sums or otherwise.
"Lender" shall have the meaning given such term in the introductory
paragraph hereof.
"LIBOR-Based Rate" shall mean a rate of interest equal to the Eurodollar
Rate plus one and one-half percent (1.50%) per annum.
"Lien" shall mean any security interest, mortgage, pledge, lien, claim on
property, charge or encumbrance (including any conditional sale or other title
retention agreement), any lease in the nature thereof, and the filing of or
agreement to give any financing statement under the Uniform Commercial Code of
any jurisdiction.
"Loan" shall have the meaning given such term in Paragraph 1(a) above.
"Maturity Date" shall mean October 20, 1999, as such date may be extended
from time to time in writing by the Lender, in its sole discretion.
"Note" shall mean have the meaning given such term in Paragraph 2(b)
hereof.
"Obligations" shall mean any and all debts, obligations and liabilities of
the Company to the Lender (whether now existing or hereafter arising, voluntary
or involuntary, whether or not jointly owed with others, direct or indirect,
absolute or contingent, liquidated or unliquidated, and whether or not from time
to time decreased or extinguished and later increased, created or incurred),
arising out of or related to the Credit Documents.
"Parent" shall mean Apple Suites Advisors, Inc., a Virginia Corporation.
"Person" shall mean any corporation, natural person, firm, joint venture,
partnerships, trust, unincorporated organization or Governmental Authority.
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"Potential Default" shall mean an event which but for the lapse of time or
the giving of notice, or both, would constitute an Event of Default.
"Requirements of Law" shall mean, as to any Person, the Articles or
Certificate of Incorporation and Bylaws or other organizational or governing
documents of such Person, and any law, treaty, rule or regulation, or a final
and binding determination of an arbitrator or a determination of a court or
other Governmental Authority, in each case applicable to or binding upon such
Person or any of its property or to which such Person or any of its property is
subject.
"Subsidiary" shall mean any corporation, partnership or joint venture more
than fifty percent (50%) of the stock or other ownership interest of which
having by the terms thereof ordinary voting power to elect the board of
directors, managers or trustees of such corporation, partnership or joint
venture (irrespective of whether or not at the time stock of any other class or
classes of such corporation, partnership or joint venture shall have or might
have voting power by reason of the happening of any contingency) shall, at the
time as of which any determination is being made, be owned, either directly or
through Subsidiaries.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed and sealed as of the day and year first above written.
APPLE SUITES, INC., a Virginia corporation
By: /s/ Xxxxx X. Xxxxxx
---------------------------------------
Name: Xxxxx X. Xxxxxx
-------------------------------------
Title: President
------------------------------------
FIRST UNION NATIONAL BANK, a national
banking association
By:
---------------------------------------
Name:
-------------------------------------
Title:
------------------------------------
13
LIST OF SCHEDULES AND EXHIBITS
------------------------------
Schedule I Schedule of Addresses
Exhibit A Form of Promissory Note
Schedule of Addresses
LENDER COMPANY
------ -------
First Union National Bank Apple Suites, Inc.
Xxx Xxxxx Xxxxx Xxxxxx, XX-0 000 Xxxx Xxxx Xxxxxx
000 Xxxxx Xxxxxxx Xxxxxx Xxxxxxxx, Xxxxxxxx 00000
Xxxxxxxxx, Xxxxx Xxxxxxxx 00000-0000 Attention: X.X. Xxxxxxx, Xx.
Attention: Xxxx Xxxxxxxx Telephone No.: (000) 000-0000
Telephone No.: (000) 000-0000 Telecopy No.: (000) 000-0000
Telecopy No.: (000) 000-0000
2
