FIRST AMENDMENT TO GUARANTY OF PAYMENT OF DEBT
THIS FIRST AMENDMENT TO GUARANTY OF PAYMENT
OF DEBT is made and entered into as of this 12th day of
September, 1995 by and among FOREST CITY ENTERPRISES, INC.,
an Ohio corporation ("Parent"), NATIONAL CITY BANK, THE
HUNTINGTON NATIONAL BANK, COMERICA BANK, FIRST NATIONAL
BANK OF OHIO, and SOCIETY NATIONAL BANK (collectively the
"Banks" and individually a "Bank"), and SOCIETY NATIONAL
BANK, as Agent for the Banks (the "Agent").
W I T N E S S E T H:
WHEREAS, Forest City Rental Properties
Corporation ("Borrower"), the Banks, and the Agent entered
into a certain Credit Agreement dated as of July 25, 1994
(the "Credit Agreement");
WHEREAS, the Banks required, as a condition
to entering into the Credit Agreement, that Parent execute
and deliver to the Agent and the Banks a certain Guaranty
of Payment of Debt dated July 25, 1994 (the "Guaranty") and
Parent agreed to and did execute and deliver the Guaranty
to the Agent and the Banks; and
WHEREAS, Borrower, Parent, the Banks, and
the Agent desire to make certain amendments to the Credit
Agreement and, concurrently therewith, to make certain
amendments to the Guaranty;
NOW, THEREFORE, it is mutually agreed as
follows:
1. AMENDMENTS.
(a) Section 9.8 of the Guaranty is hereby
amended to read as follows:
9.8. CASH FLOW. Borrower and Guarantor
will not suffer or permit their Cash Flow to
fall below (a) Fifty-Two Million Five
Hundred Thousand Dollars ($52,500,000) for
their fiscal year ending January 31, 1996,
(b) for their fiscal year ending January 31,
1997, the greater of (i) the sum of Fifty-
Two Million Five Hundred Thousand Dollars
($52,500,000) plus fifty percent (50%) of
the amount, if any, by which their Cash Flow
in their fiscal year ending January 1, 1996
exceeded Fifty-Two Million Five Hundred
Thousand Dollars ($52,500,000) and (ii)
Fifty-Five Million Dollars ($55,000,000),
and (c) with respect to each of their fiscal
years ending after January 31, 1997, the sum
of (i) Fifty-Five Million Dollars
($55,000,000), plus (ii) the cumulative sum
of amounts equal to fifty percent (50%) of
the amount, if any, by which their Cash Flow
in each fiscal year (commencing with their
fiscal year ending January 31, 1998) exceeds
their Cash Flow in the immediately preceding
fiscal year.
(b) Section 9.12(f) of the Guaranty is
hereby amended to read as follows:
(f) any other guaranty by Guarantor,
provided that Guarantor's aggregate personal
liability in respect of all those other
guarantees and all indebtedness for borrowed
money (other than any loan permitted by
clauses (a) through (c), both inclusive, of
Section 9.10 hereof) does not exceed, and
after making the guaranty in question would
not exceed, Four Million Five Hundred
Thousand Dollars ($4,500,000)
(c) Section 9.14 of the Guaranty is hereby
amended to read as follows:
9.14. NET WORTH; ADJUSTED NET WORTH.
(a) Guarantor will not suffer or permit
its Net Worth (determined on a consolidated
basis) at any time to fall below One Hundred
Fifty-Five Million Dollars ($155,000,000)
increased on a cumulative basis by twenty-
five per cent (25%) of Guarantor's Net
Earnings (before Dividends) in each fiscal
year beginning after January 31, 1996.
(b) Guarantor will not suffer or permit its
Net Worth (determined on a consolidated
basis) plus Guarantor's accumulated
depreciation, plus deferred taxes, at any
time to fall below Four Hundred Seventy-Five
Million Dollars ($475,000,000).
2. DEFINITIONS. Terms used in this First
Amendment to Guaranty of Payment of Debt that are defined
in the Guaranty or the Credit Agreement shall have the
respective meanings ascribed to them in the Guaranty or the
Credit Agreement, as the case may be.
3. REPRESENTATIONS AND WARRANTIES. Parent
represents and warrants to the Agent and each of the Banks
that all of the representations and warranties of the
Parent set forth in Section 7 of the Guaranty are true and
correct on and as of the date hereof and that no Event of
Default or Possible Default exists on such date.
4. NO WAIVER. The acceptance, execution
and/or delivery of this First Amendment to Guaranty of
Payment of Debt by the Agent and the Banks shall not
constitute a waiver or release of any obligation or
liability of the Parent under the Guaranty as in effect
prior to the effectiveness of this First Amendment to
Guaranty of Payment of Debt or as amended hereby or waive
or release any Event of Default or Possible Default
existing at any time.
5. CONDITIONS TO EFFECTIVENESS. The
amendments to the Guaranty herein provided for shall become
effective upon the satisfaction of all of the following
conditions:
(a) The Borrower shall have paid to the
Agent for the Pro rata benefit of the Banks a fee of
$50,000 in respect of the increase in the Commitments
provided for in the First Amendment to Credit Agreement
executed contemporaneously herewith;
(b) The Borrower shall have executed and
delivered to the Agent and the Banks a First Amendment to
Credit Agreement (the "First Amendment to Credit
Agreement") in form and substance satisfactory to the
Agent, the Banks, and their respective counsel;
(c) New Revolving Loan Notes in the
respective principal amounts of the Revolving Loan Maximum
for each Bank shall have been duly executed and delivered
by the Borrower to each of the Banks;
(d) The Agent and the Banks shall have
received such opinions of counsel to the Borrower and the
Parent, certified copies of resolutions of the boards of
directors of the Borrower and the Parent, and such other
documents as shall be required by the Agent, the Banks, or
their respective counsel to evidence and confirm the due
authorization, execution, and delivery of the First
Amendment to Credit Agreement and the new Revolving Loan
Notes by the Borrower and of this First Amendment to
Guaranty of Payment of Debt by the Parent; and
(e) No Event of Default or Possible Default
shall exist.
6. CONFIRMATION OF GUARANTY. The Parent
hereby confirms that the Guaranty is in full force and
effect on the date hereof, and that, upon the amendments
herein provided becoming effective, the Guaranty will
continue in full force and effect in accordance with its
terms, as hereby amended. Parent expressly acknowledges
that the First Amendment to Credit Agreement provides,
among other things, for an increase of $10,000,000 in the
maximum aggregate principal amount of Revolving Loans
available under the terms thereof to Borrower, and agrees
that the obligations of the Parent under the Guaranty shall
include such additional Debt as may be incurred by Borrower
from time to time on account of such increase.
IN WITNESS WHEREOF, the parties hereto, each
by an officer thereunto duly authorized, have caused this
First Amendment to Guaranty of Payment of Debt to be
executed and delivered as of the date first above written.
FOREST CITY ENTERPRISES, INC.
By: /s/ Xxxxxx X. Xxxxx
Xxxxxx X. Xxxxx
Title: Senior V.P. - CFO & Secretary
NATIONAL CITY BANK
By: /s/ Xxxxxxx X. Xxxxxx
Xxxxxxx X. Xxxxxx
Title: Vice President
THE HUNTINGTON NATIONAL BANK
By: /s/ Xxxxx X. Xxxxx
Xxxxx X. Xxxxx
Title: Senior Vice President
COMERICA BANK
By: /s/ Xxxx X. Xxxxx, III
Xxxx X. Xxxxx, III
Title: Assistant Vice President
FIRST NATIONAL BANK OF OHIO
By: /s/ Xxxx X. Xxxxxxx
Xxxx X. Xxxxxxx
Title: Vice President
SOCIETY NATIONAL BANK
Individually and as Agent
By: /s/ Xxxxx X. Xxxxx
Xxxxx X. Xxxxx
Title: Vice President
