EXHIBIT 10.2
NOTE PURCHASE OVERRIDE AGREEMENT
NOTE PURCHASE OVERRIDE AGREEMENT (this "AGREEMENT"), dated June 28, 2002,
among National Golf Operating Partnership, L.P. a Delaware limited partnership
(the "BORROWER"), National Golf Properties, Inc., a Maryland corporation (the
"GENERAL PARTNER"), and the Noteholders party hereto. Capitalized terms used
herein have the respective meanings ascribed thereto in Article I hereof.
RECITALS
1. WHEREAS, pursuant to that certain Note Purchase Agreement, dated as of
December 15, 1994 (as amended, modified or supplemented from time to time
including pursuant to this Agreement and the Collateral Agency Agreement, the
"1994 NOTE AGREEMENT"), between the Borrower and the purchasers party thereto,
the Borrower issued and such purchasers purchased $100,000,000 aggregate
principal amount of the Borrower's Guarantied Senior Promissory Notes, comprised
of 8.68% Guarantied Senior Promissory Notes, Series A, due December 15, 2004 in
the aggregate principal amount of $50,000,000, and 8.73% Guarantied Senior
Promissory Notes due June 15, 2005 in the aggregate principal amount of
$50,000,000 (collectively, the "1994 NOTES");
2. WHEREAS, pursuant to that certain Restated Note Agreement, dated as of
July 1, 1996 (as amended, modified or supplemented from time to time including
pursuant to this Agreement and the Collateral Agency Agreement, the "1996 NOTE
AGREEMENT", and, together with the 1994 Note Agreement the "NOTE PURCHASE
AGREEMENTS"), between the Borrower and the purchasers party thereto, the
Borrower issued and such purchasers purchased $75,000,000 aggregate principal
amount of the Borrower's Guarantied Senior Promissory Notes, comprised of 7.90%
Senior Notes, Series A, due June 15, 2006, in the aggregate principal amount of
$40,000,000; such Series A comprised of Series A-1 Notes, in the aggregate
principal amount of $14,758,700, Series A-2 Notes, in the aggregate principal
amount of $13,794,200, and Series A-3 Notes, in the aggregate principal amount
of $11,447,1000, and 8% Senior Notes, Series B, due December 12, 2006, in the
aggregate principal amount of $35,000,000, (the "1996 NOTES," and, together with
the 1994 Notes, the "NOTES");
3. WHEREAS, pursuant to that certain Amended and Restated Credit Agreement
dated as of July 30, 1999 (as amended by the Extension Agreement but without
giving effect to any subsequent amendments, modifications, restatements or
supplements thereto that have not been consented to by each of the Required
Noteholders, the "1999 CREDIT AGREEMENT"), among the Borrower, the General
Partner, Bank One, N.A. as administrative agent (the "ADMINISTRATIVE AGENT") and
the lenders named therein (together with any successors and assigns from time to
time, the "LENDERS"), the Lenders agreed to provide a term loan facility in the
amount of $100,000,000 ("TERM FACILITY") and a revolving credit facility in the
maximum aggregate
amount of $200,000,000 ("REVOLVING FACILITY"; and together with the Term
Facility, the "BANK LOANS") on the terms and subject to the conditions set forth
therein, as evidenced by the promissory notes executed and delivered thereunder
from time to time (collectively, the "1999 Bank Notes");
4. WHEREAS, pursuant to the terms of a Forbearance Agreement dated as of
February 8, 2002 among the Borrower, the General Partner, the Administrative
Agent and Lenders (the "ORIGINAL FORBEARANCE AGREEMENT"), as amended by an
Amendment and Extension of Forbearance Agreement dated as of March 29, 2002 (the
"FIRST AMENDMENT"), a Second Amendment and Extension of Forbearance Agreement
dated as of April 30, 2002 (the "SECOND AMENDMENT"), a Third Amendment and
Extension of Forbearance Agreement dated as of May 15, 2002 (the "THIRD
AMENDMENT"), a Fourth Amendment and Extension of Forbearance Agreement dated as
of May 31, 2002 (the "FOURTH AMENDMENT"), and a Fifth Amendment and Extension of
Forbearance Agreement dated as of June 14, 2002 (the "FIFTH AMENDMENT", and
collectively with the Original Forbearance Agreement, the First Amendment, the
Second Amendment, the Third Amendment and the Fourth Amendment, the "FORBEARANCE
AGREEMENT"), Lenders agreed to forbear from exercising their remedies under the
Loan Documents on account of certain "SPECIFIED DEFAULTS" (as defined in Section
1 of the Original Forbearance Agreement) and to extend the Revolving Facility
Termination Date under the 1999 Credit Agreement;
5. WHEREAS, by that certain Amendment and Extension of Credit Agreement of
even date herewith by and among the Administrative Agent, the Borrower, the
General Partner and the Lenders (the "Extension Agreement") the maturity date of
all of the outstanding Bank Loans has been revised to be March 31, 2003, the
1999 Credit Agreement has been amended in other respects and certain defaults
thereunder have been waived;
6. WHEREAS, the Borrower, the Lenders, the Administrative Agent, the
Collateral Agent and the Noteholders have entered into the Collateral Agency
Agreement;
7. WHEREAS, in connection with the execution of the Collateral Agency
Agreement, the Borrower and the Noteholders now hereby wish to modify and amend
the Note Purchase Agreements and the Notes in certain respects, all as set forth
in greater detail below.
NOW, THEREFORE, for valuable consideration the receipt and adequacy of
which are hereby acknowledged, the parties hereto hereby agree as follows,
notwithstanding anything to the contrary in the Note Purchase Agreements or the
Notes:
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ARTICLE I
DEFINITIONS
Terms defined in the applicable Note Purchase Agreements and not otherwise
defined or modified herein have the respective meanings set forth in the
applicable Note Purchase Agreements. In addition, as used in this Agreement, the
following terms have the meanings specified below:
"1994 GUARANTY" shall mean the Guaranty as defined in the 1994 Note
Purchase Agreement as amended, modified or supplemented from time to time
including pursuant to this Agreement..
"1996 GUARANTY" shall mean the Guaranty as defined in the 1996 Note
Purchase Agreement as amended, modified or supplemented from time to time
including pursuant to this Agreement.
"1994 NOTE AGREEMENT" shall have the meaning set forth in the recitals
above.
"1994 NOTES" shall have the meaning set forth in the recitals above.
"1996 NOTE AGREEMENT" shall have the meaning set forth in the recitals
above.
"1996 NOTES" shall have the meaning set forth in the recitals above.
"1999 BANK NOTES" shall have the meaning set forth in the recitals above.
"1999 CREDIT AGREEMENT" shall have the meaning set forth in the recitals
above (a copy of which is attached hereto as EXHIBIT A).
"ADMINISTRATIVE AGENT" shall have the meaning set forth in the recitals
above.
"AGREEMENT" shall have the meaning set forth in the recitals above.
"AGC" shall have the meaning set forth in the Note Purchase Agreements.
"AMENDMENT PERIOD" shall mean the period commencing on the Effective Date
and ending on the Mandatory Prepayment Date.
"BANK LOANS" shall have the meaning set forth in the recitals above.
"BORROWER" shall have the meaning set forth in the introductory paragraph
hereof.
"CLOSING DATE" shall, solely for purposes of Section 2.1(a) of this
Agreement, mean the date of this Agreement, it being understood that the term
"Closing Date" as
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defined in the Existing Note Purchase Agreements shall continue to be applied as
so defined therein for all purposes of the Note Purchase Agreements other than
for purposes of Section 2.1(a) of this Agreement.
"COLLATERAL AGENCY AGREEMENT" shall mean the Security and Collateral
Agency Agreement, dated as of June 28, 2002, among the Noteholders, the Lenders,
the Administrative Agent, the Borrower and the Collateral Agent, as amended,
modified or supplemented from time to time.
"COLLATERAL AGENT" shall mean BNY Midwest Trust Company, an Illinois
corporation, in its capacity as collateral agent under the Collateral Agency
Agreement, or any successor or replacement collateral agent thereunder.
"DECEMBER PREPAYMENT" shall have the meaning set forth in SECTION 2.1(A)
hereof.
"DEBT DOCUMENTS" shall mean the (1) 1994 Note Agreement, (2) 1996 Note
Agreement, (3) the 1999 Credit Agreement, (4) the 1999 Bank Notes, (5) the
Notes, (6) this Agreement, (7) that certain subordination, non-disturbance and
attornment agreement among Borrower, the Collateral Agent and AGC, (8) the
Security Instruments, (9) all other documents now or hereafter executed by the
Borrower, or any other person or entity to evidence or secure the payment of the
Secured Obligations and (10) all modifications, restatements, extensions,
renewals and replacements of the foregoing.
"DEFERRED MAKEWHOLE AMOUNT" shall have the meaning set forth in Section
2.1(c) hereof.
"DEFERRED MAKEWHOLE PAYMENT DATE" shall mean the first to occur of (i) the
Mandatory Prepayment Date, (ii) the date on which the principal of any of the
Notes or the 1999 Bank Notes is accelerated as a result of any default, and
(iii) the date on which all principal and interest on the Notes is paid in full.
"DEFERRED MAKEWHOLE PERIOD" shall mean the period commencing on the
Effective Date and ending on the day immediately prior to the Mandatory
Prepayment Date.
"DEFERRED MAKEWHOLE PERIOD PREPAYMENT" shall have the meaning set forth in
SECTION 2.1(C) hereof.
"DISTRIBUTION" shall, solely for purposes of SECTION 2.4 of this
Agreement, have the meaning assigned in Article I of the Collateral Agency
Agreement, it being understood that the term "Distributions" as defined in the
Existing Note Purchase Agreements shall continue to be applied as so defined
therein for all purposes of the Note Purchase Agreements other than for purposes
of SECTION 2.4 of this Agreement.
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"EFFECTIVE DATE" shall have the meaning set forth in Article III.
"EXISTING NOTE PURCHASE AGREEMENTS" shall mean the Note Purchase
Agreements as in effect immediately prior to the execution of this Agreement.
"EXISTING NOTES" shall mean the Notes, as in effect immediately prior to
the execution of this Agreement.
"EXTENSION AGREEMENT" shall have the meaning set forth in the recitals
above, a copy of which is attached hereto as EXHIBIT B.
"FORBEARANCE AGREEMENT" shall have the meaning set forth in the recitals
above.
"GENERAL PARTNER" shall have the meaning set forth in the introductory
paragraph hereof.
"GUARANTY AGREEMENTS" shall mean the 1994 Guaranty and the 1996 Guaranty.
"LENDERS" shall have the meaning set forth in the recitals above.
"LENDERS' ADVISORS' FEES" shall mean the unpaid fees and expenses of
Xxxxxxxxxxxx Xxxx & Xxxxxxxxx, as counsel to the Administrative Agent, and
FTI/Xxxxxxxx & Xxxxx, as financial advisor to the Administrative Agent, in each
case for services on or prior to the Effective Date.
"LENDERS' FEES" shall mean (i) a fee paid to the Administrative Agent for
the benefit of the Lenders equal to 0.125% of the aggregate outstanding
principal balance of the Revolving Facility and Term Facility as of the
Effective Date, and (ii) a fee payable to the Administrative Agent for its
services on or prior to the Effective Date pursuant to a letter agreement, a
copy of which has been provided to the Noteholders.
"MAJOR DEFAULT": shall have the meaning set forth in SECTION 6.1 hereof.
"MAKEWHOLE AMOUNT" shall have the meaning set forth in the Note Purchase
Agreements.
"MANDATORY PREPAYMENT DATE" shall have the meaning assigned to such term
in Section 2.2.
"MERGER AGREEMENT" shall have the meaning set forth in SECTION 7.1 hereof.
"MORTGAGES" shall mean those certain mortgages, deeds of trust and deeds
to secure debt encumbering the Collateral Projects (as defined in the Collateral
Agency Agreement), executed by the Borrower in favor of the Collateral Agent for
the benefit of
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the Secured Creditors (as defined in the Collateral Agency Agreement), each as
amended, modified or supplemented from time to time in accordance with Section
22 of the Collateral Agency Agreement.
"NEWCO" shall have the meaning set forth in SECTION 7.1 hereof.
"NEWCO TRANSACTION" shall have the meaning set forth in SECTION 7.1
hereof.
"NOTEHOLDERS" shall mean the holders from time to time of the Notes.
"NOTE PURCHASE AGREEMENTS" shall have the meaning set forth in the recitals
above.
"NOTES" have the meaning set forth in the Note Purchase Agreements, as
modified by the meaning set forth in the recitals above.
"ORIGINAL FORBEARANCE AGREEMENT" shall have the meaning set forth in the
recitals above.
"ORIGINAL SCHEDULED MANDATORY REPAYMENT" shall mean each required
prepayment and maturity date repayment of principal required under Section 3.1
of the Existing Note Purchase Agreements.
"PERSON" shall have the meaning set forth in the Note Purchase Agreements.
"PRO RATA PAYMENT REQUIREMENT" shall mean the requirement that any payment
of principal, from whatever source obtained, by the Borrower in respect of the
Bank Loans and the Notes (I) shall be shared, as among the Lenders and the
Noteholders, pro-rata between the Noteholders in the aggregate, on the one hand,
and the Lenders, in the aggregate, on the other hand, based on the aggregate
amount of principal (for the avoidance of doubt, not including any accrued
interest or Makewhole Amounts) outstanding under both the Notes and the Bank
Loans, respectively, immediately prior to such payment; provided, however, that
for the purposes of this clause (i), it is expressly understood and agreed that
such requirement shall not apply to the Reserved Amount which shall be paid
exclusively to the Noteholders in respect of principal of the Notes on or prior
to the Effective Date, and (II) shall be shared, as among the Noteholders,
pro-rata based on the amount of principal (for the avoidance of doubt, not
including any accrued interest or Makewhole Amounts) outstanding under each of
the Notes immediately prior to such payment; provided, however, that, for
purposes of this clause (ii), it is expressly understood and agreed that such
requirement shall not apply to the $3,298,914 portion of the Reserved Amount to
be applied to the payment on the Effective Date of the December Prepayment
pursuant to SECTION 2.1(A) hereof.
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"RENT DEFERRAL AGREEMENT" shall mean the agreement, in the form of Exhibit
C hereto, among the Borrower and the Administrative Agent on behalf of the
Lenders described in Section 6.9 of the Note Purchase Agreements as amended by
this Agreement.
"REQUIRED NOTEHOLDERS" shall mean, as of any date, the Required 1994
Noteholders and the Required 1996 Noteholders.
"REQUIRED 1994 NOTEHOLDERS" shall mean, as of any date, the then current
holders of at least 66-2/3% of the outstanding principal amount of the 1994
Notes (exclusive of any 1994 Notes owned, directly or indirectly, by any one or
more of the Borrower, the General Partner or any subsidiary or Affiliate of the
Borrower or the General Partner, or any officer or director thereof), provided,
that, if there is then no principal amount of the 1994 Notes outstanding
(exclusive of any 1994 Notes owned, directly or indirectly, by any one or more
of the Borrower, the General Partner or any subsidiary or Affiliate of the
Borrower of the General Partner, or any officer or director thereof), but
accrued Makewhole Amounts are still outstanding with respect to such Notes,
Required 1994 Noteholders shall mean the holders of at least 66 2/3% of the
accrued Makewhole Amounts that are outstanding with respect to such Notes
(exclusive of any Makewhole Amounts accrued with respect to any such Notes
owned, directly or indirectly, by any one or more of the Borrower, the General
Partner or any subsidiary or Affiliate of the Borrower or the General Partner,
or any officer or director thereof).
"REQUIRED 1996 NOTEHOLDERS" shall mean, as of any date, the then current
holders of at least 66-2/3% of the outstanding principal amount of the 1996
Notes (exclusive of any 1996 Notes owned, directly or indirectly, by any one or
more of the Borrower, the General Partner or any subsidiary or Affiliate of the
Borrower or the General Partner, or any officer or director thereof), provided,
that, if there is then no principal amount of the 1996 Notes outstanding
(exclusive of any 1996 Notes owned, directly or indirectly, by any one or more
of the Borrower, the General Partner or any subsidiary or Affiliate of the
Borrower of the General Partner, or any officer or director thereof), but
accrued Makewhole Amounts are still outstanding with respect to such Notes,
Required 1996 Noteholders shall mean the holders of at least 66 2/3% of the
accrued Makewhole Amounts that are outstanding with respect to such Notes
(exclusive of any Makewhole Amounts accrued with respect to any such Notes
owned, directly or indirectly, by any one or more of the Borrower, the General
Partner or any subsidiary or Affiliate of the Borrower or General Partner, or
any officer or director thereof).
"RESERVED AMOUNT" shall have the meaning set forth in SECTION 2.1(A)
hereof.
"RESPONSIBLE OFFICER" shall mean any of the President, the Chief Executive
Officer, the Interim Chief Executive Officer, the Chief Financial Officer, any
Senior Vice President or any Vice President of the Borrower.
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"REVOLVING FACILITY" shall have the meaning set forth in the recitals
above, which shall replace the meaning set forth in the Note Purchase
Agreements.
"REVOLVING FACILITY TERMINATION DATE" shall mean March 31, 2003.
"SECURED OBLIGATIONS" shall have the meaning assigned thereto in the
Collateral Agency Agreement.
"SECURITY INSTRUMENTS" shall have the meaning assigned thereto in the
Collateral Agency Agreement.
"SPECIFIED DEFAULTS" shall have the meaning set forth in the recitals
above.
"TERM FACILITY" shall have the meaning set forth in the recitals above.
ARTICLE II
PAYMENTS DURING DEFERRED MAKEWHOLE PERIOD AND ON MANDATORY PREPAYMENT DATE
2.1 PAYMENTS DURING DEFERRED MAKEWHOLE PERIOD.
(a) DISTRIBUTION OF RESERVED AMOUNT. Notwithstanding anything to the
contrary provided in the Existing Note Purchase Agreements or the Existing
Notes, on the Effective Date, $14,956,463 reserved as of the Closing Date
(as defined in Article I of this Agreement) for payment to the Noteholders
(the "RESERVED AMOUNT") shall be applied to the payment of principal of
the Notes as follows: FIRST, $3,298,914 shall be applied to the prepayment
of the Original Scheduled Mandatory Repayments, due on December 15, 2002
(such prepayment, the "DECEMBER PREPAYMENT"); and SECOND, the remaining
Reserved Amount shall be applied, ratably in the manner contemplated by
Section 3.4 of each of the Note Purchase Agreements, to the prepayment of
Original Scheduled Mandatory Repayments of each of the Notes.
(b) SUBSEQUENT MANDATORY PREPAYMENTS DURING DEFERRED MAKEWHOLE PERIOD.
Notwithstanding anything to the contrary provided in the Existing Note
Purchase Agreements or the Existing Notes, at any time during the Deferred
Makewhole Period that the Borrower makes (or is obligated to make) any
payment of principal of the Bank Loans (including, without limitation, any
prepayment pursuant to the provisions of Section 2.8(b) of the 1999 Credit
Agreement, as amended by the Extension Agreement, which provisions are
incorporated by reference herein pursuant to Section 5.1 hereof), there
shall become due and payable (and the Borrower shall make) at the same
time a mandatory prepayment of principal in respect of all of the Notes,
out of funds other than the Reserved
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Amount, in an amount sufficient and in the manner required to satisfy the
Pro Rata Payment Requirement, and such amount shall be applied, ratably in
the manner contemplated by Section 3.4 of each of the Note Purchase
Agreements, to the prepayment of Original Scheduled Mandatory Repayments
of each of the Notes.
(c) DEFERRED MAKEWHOLE AMOUNTS. Notwithstanding anything to the contrary
provided in the Existing Note Purchase Agreements or the Existing Notes,
any Makewhole Amount which, pursuant to the terms of the applicable
Existing Note Purchase Agreement, would be payable in respect of any
prepayment made pursuant to SECTION 2.1(A) or SECTION 2.1(B) hereof (any
such prepayment, an "DEFERRED MAKEWHOLE PERIOD PREPAYMENT") on the date of
such prepayment (a "Deferred Makewhole Amount") shall be deferred, and
shall be calculated and payable, as follows:
(i) The Deferred Makewhole Amount with respect to each Deferred
Makewhole Period Prepayment shall be calculated, as of the date
that the related Deferred Makewhole Period Prepayment is made,
according to the relevant provisions of the applicable Note
Purchase Agreement based on the amortization schedules and
interest rates and payment dates in effect prior to the execution
of this Agreement; and
(ii) All Deferred Makewhole Amounts shall: (i) be subordinated to
the payment of principal and interest on the Bank Loans and the
Notes in full as provided in Section 15 of the Collateral Agency
Agreement; (ii) be payable in full, together with all accrued
interest thereon, on the Deferred Makewhole Payment Date; and
(iii) accrue interest at 5.00% per annum, compounded
semi-annually, from the date that the related Deferred Makewhole
Period Prepayment is made until the Deferred Makewhole Payment
Date (and, if not paid in full on the Deferred Makewhole Payment
Date, the unpaid portion thereof shall bear interest from the
Deferred Makewhole Payment Date until the date of payment thereof
at the interest rate applicable to defaulted principal in respect
of the underlying Notes pursuant to which such Deferred Makewhole
Amount was due).
(d) INTEREST AND FEES. During the Deferred Makewhole Period all payments
of interest and fees in respect of the Notes will continue to be paid
currently (including payment, on the date of each Deferred Makewhole
Period Prepayment, of all accrued and unpaid interest with respect to the
principal amount prepaid on such date) in accordance with the terms of the
Note Purchase Agreements, respectively, except (for the avoidance of
doubt) that, notwithstanding anything to the contrary provided in the
Existing Note Purchase Agreements or the Existing
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Notes, Deferred Makewhole Amounts, together with all accrued interest
thereon, shall be payable as provided for in SECTION 2.1(C) hereof.
2.2 MANDATORY PREPAYMENT IN FULL ON MANDATORY PREPAYMENT DATE. Notwithstanding
anything to the contrary provided in the Existing Note Purchase Agreements or
the Existing Notes, on March 31, 2003 (the "Mandatory Prepayment Date") the
Borrower shall prepay, and there shall become due and payable, 100% of the then
outstanding principal amount of all of the Notes, together with all accrued and
unpaid interest thereon and all Makewhole Amounts, if any, in respect of such
mandatory prepayment (calculated as of the Mandatory Prepayment Date according
to the relevant provisions of the Note Purchase Agreements based on the
amortization schedules and interest rates and payment dates in effect prior to
the execution of this Agreement).
2.3 NOTICE OF PREPAYMENT. The notice requirements of Section 3.3 of the Note
Purchase Agreements are waived by the Noteholders with respect to all
prepayments of Notes pursuant to this Article II, and in lieu thereof the notice
provisions of this Section 2.3 shall apply. The Borrower will give each holder
of a Note written notice of each prepayment pursuant to this Article II, in each
case specifying (i) the date of such prepayment, (ii) the aggregate principal
amount of Notes to be prepaid on such date, (iii) the principal amount of each
Note held by such holder so to be prepaid determined in accordance with the
applicable provisions of this Article II, (iv) the Borrower's calculation of the
respective amounts of (A) accrued interest payable to such holder in respect of
each such prepayment and (B) the Makewhole Amount or the Deferred Makewhole
Amount, if any, applicable in respect of each such prepayment, showing in each
case in reasonable detail the calculation thereof and the applicable Reference
Rate used in such calculation, (v) the provision of this Article II pursuant to
which such prepayment is being made, and (vi) a calculation demonstrating
compliance with the Pro Rata Payment Requirement including all amounts to be
paid to the Lenders and the Noteholders on such date. Such notice shall be given
(i) in the case of prepayment pursuant to Section 2.1(a) hereof, on or prior to
the Effective Date, and (ii) in the case of prepayment pursuant to Section
2.1(b) or Section 2.2 hereof, a notice containing estimated amounts shall be
delivered at least three (3) Business Days prior to the date of prepayment; and
a second notice detailing actual amounts shall be delivered on the date of
payment; provided, however, that any delay in giving, or failure to give, any
such notice shall not affect the obligations of the Borrower (X) to make the
applicable prepayment on the prepayment date determined pursuant to the
provisions of Section 2.1(a), Section 2.1(b) or Section 2.2, as applicable, (Y)
to pay the Deferred Makewhole Amount in respect of each prepayment pursuant to
Section 2.1(a) and (b) on the Deferred Makewhole Payment Date, and (Z) to pay
the Makewhole Amount in respect of the prepayment pursuant to Section 2.2 on the
Mandatory Prepayment Date.
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2.4 DISTRIBUTIONS. Notwithstanding anything to the contrary in the Note Purchase
Agreements, all Distributions (as defined in Article I of this Agreement) shall
be made in accordance with Section 15 of the Collateral Agency Agreement.
ARTICLE III
CONDITIONS TO EFFECTIVENESS
This Agreement shall become effective upon the later of the execution
hereof by the Borrower and the Noteholders of all outstanding Notes and the
satisfaction (or waiver by the Required Noteholders) not later than June 28,
2002 of each of the following conditions precedent (the "EFFECTIVE DATE"):
3.1 REPRESENTATIONS AND WARRANTIES. The representations and warranties of the
Borrower contained in this Agreement, the Collateral Agency Agreement, the
Mortgages and the Extension Agreement shall be true and correct in all material
respects, in each case on the Effective Date (as if made on such date) or as of
an earlier date as to which they speak.
3.2 RECEIPT OF DOCUMENTS. The Noteholders shall have received (i) duly executed
original counterparts of this Agreement and the Collateral Agency Agreement, and
(ii) true and correct copies of the Mortgages.
3.3 EXTENSION AGREEMENT. The effectiveness of the Extension Agreement shall have
occurred or be occurring contemporaneously with the effectiveness of this
Agreement as of the Effective Date, the Noteholders shall have received true and
correct copies of the Extension Agreement and all related documents (except for
any agreement between the Borrower and the Lenders that does not affect the
rights, interests or remedies of the Noteholders), all conditions precedent set
forth in Section 2(e) and Section 4 of the Extension Agreement shall have been
met to the satisfaction of the Noteholders (irrespective of any waiver of any of
such conditions by the Lenders or the Administrative Agent, except to the extent
waived by the Noteholders), and Section 2(e) and Section 4 of the Extension
Agreement are incorporated by reference as if fully set forth herein; provided
that, for purposes of this provision, (i) the reference to the Agent in clause
(b) of said Section 4 shall be deemed to be a reference to the Noteholders, and
(ii) the reference to the Agent in clause (e) of said Section 4 shall be deemed
to be a reference to the Administrative Agent.
3.4 RESOLUTION AND INCUMBENCY CERTIFICATE. Borrower shall have provided to the
Noteholders evidence reasonably satisfactory to the Required Noteholders,
including a certified resolution and an incumbency certificate from Guarantor,
substantially in the form attached as Exhibit 2(d) to the Original Forbearance
Agreement and to the effect that the individual executing this Agreement on
behalf of Borrower and Guarantor has been duly authorized by all appropriate
action to so execute and deliver this Agreement
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3.5 PAYMENT OF RESERVED AMOUNT. The payment of the Reserved Amount to the
Noteholders shall have been made pursuant to SECTION 2.1(A) of this Agreement.
3.6 FEES AND EXPENSES. The Borrower shall have paid to the Noteholders (or to
such party as the Noteholders direct) their reasonable expenses incurred through
the date hereof in connection with this Agreement which have been billed prior
to the Effective Date, including the reasonable legal fees and expenses of
Debevoise & Xxxxxxxx, as counsel to the Noteholders, and the fees and expenses
of Nightingale and Associates, LLC, as financial advisor to the Noteholders.
3.7 DEFAULTS. No Default or Event of Default (as each such term is defined in
the Note Purchase Agreements) or Major Default, in each case either prior to or
after giving effect to this Agreement, has (or shall have) occurred and is (or
will be) continuing.
3.8 OTHER CONDITIONS PRECEDENT. All conditions under the Collateral Agency
Agreement, the Mortgages and the other Debt Documents required to be satisfied
as of the Effective Date shall have been satisfied or waived in accordance with
the terms thereof.
3.9 OTHER INFORMATION. The Noteholders shall have received such other opinions,
certificates, documents and information with respect to matters related to this
Agreement and the transactions contemplated thereby as they may reasonably
request.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
4.1 The Borrower hereby represents and warrants to the Noteholders, as of the
Effective Date, as follows:
(a) No Default or Event of Default (as each such term is defined in the
Note Purchase Agreements) and no Major Default, in each case either prior
to or after giving effect to this Agreement, has (or shall have) occurred
and is (or will be) continuing.
(b) The execution, delivery and performance by the Borrower and the General
Partner, as applicable, of this Agreement, the Collateral Agency Agreement,
the Mortgages, the Extension Agreement and any related agreements to which
the Borrower is a party have been duly authorized by all necessary
corporate and other action of the Borrower and the General Partner, as
applicable, and do not and will not require any registration with, consent
or approval of, notice to or action by, any Person (including any
Governmental Authority) in order to be effective and enforceable. The Note
Purchase Agreements and the Notes as modified and amended by this
Agreement, the Collateral Agency Agreement, the Mortgages, the Extension
Agreement and any related agreements to which the
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Borrower is a party constitute the legal, valid and binding obligations of
the Borrower and the General Partner, as applicable, enforceable against
such party or parties in accordance with their respective terms, without
defense, counterclaim or offset except as such enforcement may be limited
by applicable bankruptcy, insolvency, reorganization or other similar laws
relating to or limiting creditors' rights generally or by equitable
principles relating to enforceability whether enforcement is sought in a
proceeding at law or in equity.
(c) The Borrower is entering into this Agreement on the basis of its own
investigation and for its own reasons, without reliance upon the
Noteholders or any other Person.
(e) Except for the Lenders' Fees and Lenders' Advisors' Fees, the Borrower,
in connection with the transactions contemplated by this Agreement, has not
paid and is not paying any fees to any Lender or the Administrative Agent.
ARTICLE V
COVENANTS
5.1 Section 2.8(b) of the 1999 Credit Agreement, as amended by the Extension
Agreement, is incorporated by reference as if fully set forth herein except that
(x) such incorporation by reference shall include all other provisions of the
1999 Credit Agreement and Extension Agreement referred to in the Section
specified above and all defined terms referred to therein, and (y) all
references in the incorporated covenants to the "Lenders" (except where the
clause "Lenders and the NGP Noteholders" appears) shall be deemed to mean the
Noteholders, the "Required Lenders" shall be deemed to mean the Required
Noteholders, the "Administrative Agent" shall be deemed to mean the Noteholders,
and the "NGP Noteholders" shall be deemed to mean the Noteholders.
5.2 Beginning on the Effective Date, the covenants of the Note Purchase
Agreements and Guaranty Agreements set forth on ANNEX A hereto shall be modified
as set forth therein. In addition, certain defined terms shall be added to the
Note Purchase Agreements, as set forth in ANNEX A hereto.
ARTICLE VI
MODIFIED EVENTS OF DEFAULT
6.1 All Defaults and Events of Default under the Note Purchase Agreements in
existence on the Effective Date or arising during the Amendment Period shall be
deemed to have been waived for the full Amendment Period, except for the
following (collectively, "MAJOR DEFAULTS"):
13
(a) default under any one of more of Section 8.1(a), (b), (f), (g), (h)
and (j) of either of the Note Purchase Agreements, except that for purposes
of Section 8.1(b) thereof the term "hereunder" shall be deemed to mean
"under any of the Debt Documents";
(b) the occurrence of any one or more of the following:
(i) as of the last day of any fiscal quarter during 2002, the AGC
Companies EBITDAR for the elapsed full quarters of 2002, on a
cumulative basis, is less than sixty percent (60%) of the AGC
Companies Projected EBITDAR for such period, provided that if the
proposed Newco Transaction is completed the Borrower may substitute
the consolidated EBITDAR of Newco and its subsidiaries, for the AGC
Companies EBITDAR, provided the Required Noteholders have approved the
projections of such consolidated EBITDAR and any other adjustments to
such covenant, such approval not to be unreasonably withheld (all
capitalized terms used in this Section 6.1(b)(i) and not otherwise
defined in this Section 6.1(b)(i) or this Agreement shall have the
meanings ascribed thereto in the 1999 Credit Agreement); or
(ii) the breach of Section 2.8(b) of the 1999 Credit Agreement as
incorporated by reference pursuant to Section 5.1 hereof (only as to
deposits into the Project-Related Cash Collateral Account and the
provision of Mortgages on replacement Collateral Projects) which is
not cured within ten (10) days after written notice thereof has been
given to the Borrower or Guarantor by the Required 1994 Noteholders or
the Required 1996 Noteholders; or
(iii) the breach of Section 4 of the Amendment and Extension
Agreement, as incorporated by reference pursuant to Section 3.3
hereof, or of any one or more of Sections 6.5, 6.9 and 6.10 of the
Note Purchase Agreements which is not cured within thirty (30) days
after written notice thereof has been given to the Borrower or
Guarantor by the Required 1994 Noteholders or the Required 1996
Noteholders; or
(iv) default under Section 8.1(e) of either of the Note Purchase
Agreements except that, for purposes of this clause (iv), the term
"Debt" shall mean Bank Loans, the phrase "in an aggregate principal
amount of at least $15,000,000" shall be deleted from each place
stated in said Section 8.1(e), and the phrase "aggregating not less
than $15,000,000" shall be deleted from the place stated in said
Section 8.1(e); or
14
(v) default under Section 8.1(l) of either of the Note Purchase
Agreements, in each case except to the extent such occurrence is in
accordance with the terms of the Noteholders' consent given in Section
7.1 of this Agreement;
(vi) the revocation or attempted revocation of either of the Guaranty
Agreements; or
(vii) any consolidation or cross-support between the assets and debt
of the Borrower and the assets and debt of AGC without the approval of
the Noteholders; or
(viii) Newco's incurrence of any indebtedness or grant of any Liens on
its assets unless (a) Newco has simultaneously guaranteed the Notes
and (b) if Newco has granted a Lien to any other creditor, Newco
grants a pari passu Lien to the Noteholders to secure the obligations
under the Notes and to the Lenders to secure the Bank Loans; or
(ix) failure of AGC and GEI, in the aggregate, to make scheduled rent
payments to the Borrower in excess of the delinquent amount on the
Effective Date plus, as of any date, the "Maximum Deferral Percentage"
(as defined in the Rent Deferral Agreement) times all AGC/GEI Base
Rental due from April 1, 2002 through such date, taking in account
both rent reductions due to sales of Projects and rent escalations and
rent increases on account of capital expenditures by the Borrower
Notwithstanding the foregoing, if AGC and GEI fail to pay in full the
aggregate minimum rent, the Borrower shall have a 90 day period to use
all reasonable efforts to cause AGC and GEI to pay such amounts in
full and such failure by AGC and GEI will not constitute a Major
Default during such 90 day period so long as the Borrower establishes
within ten (10) days after such failure a standing cash collateral
account with the Collateral Trustee for the benefit of the Lenders and
the Noteholders and deposits therein an amount equal to 90 days
interest on the Bank Loans and on the Note Purchase Agreements as
reasonably projected by the Administrative Agent and the Noteholders,
respectively, such deposit to be returned to Borrower if and only if
AGC and GEI fully cure such failure to pay minimum rent within such
period and otherwise to be applied to reduce the outstanding principal
balance of the Bank Loans and the Note Purchase Agreements at the end
of such period in accordance with the terms of the Collateral Agency
Agreement (all capitalized terms used in this Section 6.1(b)(ix) and
not otherwise defined in this Section 6.1(b)(ix) or this Agreement
shall have the meanings ascribed thereto in the 1999 Credit
Agreement);
15
(c) the occurrence of any one or more of the events specified in Sections
8.1 through 8.10 of the 1999 Credit Agreement, all of which Sections
are incorporated by reference as if fully set forth herein (except
that (x) such incorporation by reference shall include all other
provisions of the 1999 Credit Agreement referred to in the Sections
specified above and all defined terms referred to therein and (y) all
references in the incorporated covenants to the "Lenders" (except
where the clause "Lenders and the NGP Noteholders" appears) shall be
deemed to mean the Noteholders, the "Required Lenders" shall be deemed
to mean the Required Noteholders, the "Administrative Agent" shall be
deemed to mean the Noteholders, and the "NGP Noteholders" shall be
deemed to mean the Noteholders, except that the reference to
"Administrative Agent" in the second sentence of Section 8.10 and the
reference to "Lenders" in Section 7.31 shall remain unchanged), it
being understood that, notwithstanding anything herein or in the 1999
Credit Agreement to the contrary, the occurrence of any event under
any of Sections 8.1 through 8.10 of the 1999 Credit Agreement shall
constitute a Major Default hereunder regardless of whether the
Lenders, the Required Lenders or the Administrative Agent have waived
or consented to, or otherwise suffered to exist, such occurrence or
have amended any such Section of the 1999 Credit Agreement without the
consent of the Required Noteholders;
(d) failure of the Borrower to make deposits into the Project-Related Cash
Collateral Account required pursuant to Section 4(a)(iii)(c) of the
Collateral Agency Agreement or the Loss Proceeds Account required
pursuant to Section 6(g)(ii) of the Collateral Agency Agreement which
is not cured within ten (10) days after written notice thereof has
been given to the Borrower or Guarantor by the Required 1994
Noteholders or Required 1996 Noteholders; and
(e) the breach of any one or more of Sections 6(a), 6(f) (only with
respect to policies of insurance required to be maintained by the Borrower
under the Collateral Agency Agreement), 7(a) (only to the extent of a
material breach thereof and except to the extent of any involuntary Lien
contested by Borrower provided that the Borrower has set aside a reserve
in the contested amount and is continuously and diligently pursuing
resolution thereof) and 7(b) of the Collateral Agency Agreement which is
not cured within thirty (30) days after written notice thereof has been
given to the Borrower or Guarantor by the Required 1994 Noteholders or the
Required 1996 Noteholders.
16
ARTICLE VII
CONSENT TO REORGANIZATION
7.1 CONSENT TO GENERAL PARTNER CHANGE IN STATUS. Notwithstanding anything to the
contrary in this Agreement, the Guaranty Agreements or in the Note Purchase
Agreements, the Noteholders consent to the transaction (the "NEWCO TRANSACTION")
contemplated by the Agreement and Plan of Merger and Reorganization dated as of
March 29, 2002 among the Borrower, the General Partner and AGC and certain
affiliates (as amended in accordance with this Section 7.1, the "MERGER
AGREEMENT") including (i) the establishment of a new holding company ("NEWCO")
which upon consummation of such transactions will hold all of the common stock
of AGC and the Guarantor, and (ii) termination of the Guarantor's status as a
Real Estate Investment Trust (a "REIT"), subject to review and approval by the
Required Noteholders (which may be granted or denied in their discretion) of any
(i) amendments to the Merger Agreement or (ii) changes to the General Partner's
current operating agreement not expressly addressed in the Merger Agreement
that, in either case, materially and adversely affect the position of the
Noteholders in relation to the Borrower, Guarantor or any of their creditors.
The Noteholders will not be deemed to have approved any consolidation of, or
cross-support between, the assets and debt of the Borrower and the assets and
debt of AGC. A further approval from the Required Noteholders will be required
before any such consolidation or cross-support. In addition, the Borrower agrees
not to permit Newco to incur any indebtedness or grant any Liens on its assets
unless Newco simultaneously guarantees the obligations under the Notes, and, if
a Lien is granted to any other creditor, grants a pari passu Lien to the
Noteholders to secure the Notes and the other obligations under the Note
Purchase Agreements and to the Lenders to secure the Bank Loans. The Noteholders
hereby waive their Right to Put under Section 3.6 of the Note Purchase
Agreements in connection with the Newco Transaction consented to pursuant to
this Section 7.1.
ARTICLE VIII
MISCELLANEOUS
8.1 NO OTHER AMENDMENTS OR WAIVERS; CONFIRMATION. Except as expressly provided
herein, the provisions of the Note Purchase Agreements and the Notes are and
shall remain in full force and effect. The Borrower hereby ratifies and confirms
the Note Purchase Agreements and the Notes, as amended and modified hereby, and
agrees and confirms that the terms and conditions thereof, as amended and
modified hereby, are and shall remain in full force and effect.
17
8.2 APPLICABLE LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
8.3 COUNTERPARTS. This Agreement may be executed in two or more counterparts,
each of which shall constitute an original but all of which when taken together
shall constitute but one contract.
8.4 TRANSACTION EXPENSES. The Borrower will pay all costs and expenses
(including reasonable attorneys' fees of a special counsel and, if reasonably
required, local or other counsel) incurred by the Noteholders in connection with
the transactions contemplated by this Agreement and in connection with any
amendments, waivers or consents under or in respect of any of this Agreement,
the Collateral Agency Agreement or any other Security Instruments, any of the
Note Purchase Agreements or the Notes (whether or not such amendment, waiver or
consent becomes effective), including, without limitation: (a) the costs and
expenses incurred in enforcing or defending (or determining whether or how to
enforce or defend) any rights under the any of the Note Purchase Agreements or
the Notes or in responding to any subpoena or other legal process or informal
investigative demand issued in connection with any of the Note Purchase
Agreements or the Notes, or by reason of being a holder of any Note, and (b) the
costs and expenses, including financial advisors' fees, incurred in connection
with the insolvency or bankruptcy of the Borrower, the General Partner or any
subsidiary of either of them or in connection with any work-out or restructuring
of the transactions contemplated by any of the Note Purchase Agreements or the
Notes. Further, the Borrower will pay, and will keep each Noteholder harmless
from, all claims in respect of any fees, costs or expenses if any, of brokers
and finders (other than those retained by the Noteholders). The rights of the
Noteholders under the provision of this Section 8.5 shall be in addition to and
shall not limit, the rights of the Noteholders under any provision of the Note
Purchase Agreements, the Guaranty Agreements, the Collateral Agency Agreement or
any other document to the payment (or reimbursement) by the Borrower or the
General Partner of costs and expenses; provided, however, that any such payment
(or reimbursement) shall be made hereunder without duplication of any such
payment (or reimbursement) thereunder.
8.5 SURVIVAL. All representations and warranties contained herein shall survive
the execution and delivery of this Agreement, the transfer by any Noteholder of
any Note or portion thereof or interest therein and the payment of any Note, and
may be relied upon by any subsequent holder of a Note, regardless of any
investigation made at any time by or on behalf of any Noteholder or any other
holder of a Note.
8.6 SUCCESSORS AND ASSIGNS. This Agreement shall inure to the benefit of and be
binding upon the successors and assigns of each of the parties hereto. The
provisions of this Agreement are intended to be for the benefit of the holders
of the Notes, from time to
18
time, and shall be enforceable by any such holder, whether or not an express
assignment to such holder of rights under this Agreement have been made by any
Noteholder.
8.7 AMENDMENTS, WAIVERS AND CONSENTS.
(a) Any term, covenant, agreement or condition of this Agreement may, with
the consent of the Borrower, be amended and the compliance by the Borrower
therewith may be waived (either generally or in a particular instance in
either retroactively or prospectively) if the Borrower shall have obtained
the consent in writing of the Required Noteholders, PROVIDED THAT without
the written consent of the Noteholders holding all of the Notes then
outstanding, no such amendment or waiver shall be effective (I) which will
amend or waive any of the provisions of Article II, or (II) which will
change the percentage of Noteholders required to consent to any such
amendment or waiver under this SECTION 8.7.
(b) So long as there are any Notes outstanding, the Borrower will not
solicit, request or negotiate for or with respect to any proposed waiver
or amendment of any of the provisions of this Agreement or the Notes
unless each Noteholder (irrespective of the amount of Notes then owned by
it) shall be informed thereof by the Borrower and shall be afforded the
opportunity of considering the same and shall be supplied by the Borrower
with sufficient information to enable it to make an informed decision with
respect thereto. The Borrower will not, directly or indirectly, pay or
cause to be paid any remuneration, whether by way of supplemental or
additional interest, fee or otherwise, to any Noteholder as consideration
for or as inducement to entry into by any Noteholder of any waiver or
amendment of any of the terms and provisions of this Agreement or the
Notes unless such remuneration is concurrently paid, on the same terms,
ratably to the Noteholders.
(c) Any such amendment or waiver shall apply equally to all of the
Noteholders and shall be binding upon them, upon each future Noteholder
and upon the Borrower, whether or not such Note shall have been marked to
indicate such amendment or waiver. No such amendment or waiver shall
extend to or affect any obligation not expressly amended or waived or
impair any right or consequence thereon.
8.8 SEVERABILITY. Should any part of this Agreement for any reason be declared
invalid, such decision shall not affect the validity of any remaining portion,
which remaining portion shall remain in force and effect as if this Agreement
had been executed with the invalid portion thereof eliminated.
8.9 VOLUNTARY AGREEMENT. Borrower represents and warrants that it is represented
by legal counsel of its choice, that it has consulted with counsel regarding
this Agreement,
19
that it is fully aware of the terms of this Agreement, and that it has entered
into this Agreement voluntarily and without coercion or duress of any kind.
8.10 NO COURSE OF CONDUCT. Borrower acknowledges that the determination by the
Noteholders to enter into this Agreement does not constitute a course of conduct
or course of dealing. Borrower acknowledges that it has no basis to expect any
Noteholder to waive or modify any terms of this Agreement, or to further waive
or modify any terms of the Note Purchase Agreements, the Guaranty Agreements, or
any of the Debt Documents to which the each Noteholder is a party.
8.11 FURTHER ASSURANCES. The Borrower, the General Partner and the Noteholders
executing this Agreement shall execute and deliver such further instruments and
perform such further acts as may be reasonably requested by each other of the
foregoing Persons from time to time to confirm the provisions of this Agreement
and to carry out the intents and purposes of this Agreement.
8.12 ACKNOWLEDGMENT OF GUARANTY AGREEMENTS.
(a) The General Partner acknowledges and confirms that the 1994 Guaranty
remains in full force and effect and is applicable to the 1994 Notes, the
1994 Note Agreement and all Obligations (as defined in the 1994 Guaranty)
of the Borrower under the 1994 Notes and the 1994 Note Agreement as
amended, modified, or supplemented from time to time, including by the
terms of this Agreement and the Collateral Agency Agreement.
(b) The General Partner acknowledges and confirms that the 1996 Guaranty
remains in full force and effect and is applicable to the 1996 Notes, the
1996 Note Agreement and all Obligations (as defined in the 1996 Guaranty)
of the Borrower under the 1996 Notes and the 1996 Note Agreement as
amended, modified, or supplemented from time to time, including by the
terms of this Agreement and the Collateral Agency Agreement.
8.13 CAPTIONS. The descriptive headings of the various Sections or parts of this
Agreement are for convenience only and shall not affect the meaning or
construction of any of the provisions hereof.
8.14 RELEASES. To each's knowledge, Borrower and Guarantor have no right to
set-off, defense, claim, or cause of action against any of the Noteholders or
any of their affiliates, or any of their respective officers, directors,
employee, agents, or attorneys, in connection with the Debt Documents as of the
date hereof (whether fixed or contingent, or based on contract, tort, statute,
strict liability, or other legal or equitable theory of recovery). Borrower and
Guarantor each hereby, for itself, its successors and assigns (each a "Releasing
Party" and collectively, the "Releasing Parties"), releases, acquits and forever
20
discharges each of the Noteholders and their respective directors, officers,
employees, agents, affiliates, successors and assigns ("Released Parties") of
and from any and all claims, actions, causes of action, demand, rights, damages,
costs, and expenses whatsoever which any Releasing Party might have because of
anything done, omitted to be done, or allowed to be done by any of the Released
Parties and in connection with the Note Purchase Agreements or this Agreement or
the other Debt Documents as of the date of execution of this Amendment, whether
known or unknown, foreseen or unforeseen, including any damages and the
consequences thereof resulting or to result from the events described, referred
to or inferred herein.
21
IN WITNESS WHEREOF, the parties have caused this Agreement to be duly
executed as of the day and year first above written.
NATIONAL GOLF OPERATING PARTNERSHIP, L.P.
By: National Golf Properties Corporation,
its General Partner
By:/s/ Xxxx X. Xxxxxx
-------------------------
Name: Xxxx X. Xxxxxx
Title: CFO and Secretary
c/o National Golf Properties, Inc.
0000 00xx Xxxxxx, Xxxxx 0000
Xxxxx Xxxxxx, Xxxxxxxxxx 00000
Attention: Principal Accounting Officer
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
NATIONAL GOLF PROPERTIES, INC.
0000 00xx Xxxxxx, Xxxxx 0000
Xxxxx Xxxxxx, Xxxxxxxxxx 00000
Attention: Principal Accounting Officer
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
By:/s/ Xxxx X. Xxxxxx
-------------------------
Name: Xxxx X. Xxxxxx
Title: CFO and Secretary
-22-
(1994 Noteholders)
THE EQUITABLE LIFE ASSURANCE
SOCIETY OF THE UNITED STATES
By: /s/ Xxxx Xxxxxxxxxxx
---------------------
Name: Xxxx Xxxxxxxxxxx
Title: Investment Officer
FARM BUREAU LIFE INSURANCE COMPANY OF MICHIGAN,
as successor to FB Annuity Company
By: Advantus Capital Management, Inc.
By: /s/ Xxxxx X. Xxxxxx
------------------------
Name: Xxxxx X. Xxxxxx
Title: Vice President
FARM BUREAU LIFE INSURANCE COMPANY OF MICHIGAN
By: Advantus Capital Management, Inc.
By: /s/ Xxxxx X. Xxxxxx
------------------------
Name: Xxxxx X. Xxxxxx
Title: Vice President
-23-
NATIONAL LIFE INSURANCE COMPANY
By: /s/ R. Xxxxx Xxxxxxx
------------------------
Name: R. Xxxxx Xxxxxxx
Title: Vice President, NL Capital Management
THE OHIO NATIONAL LIFE INSURANCE COMPANY
By: /s/ Xxxxxxx X. Xxxxxxxx
------------------------
Name: Xxxxxxx X. Xxxxxxxx
Title: Senior Vice President, Investments
TEACHERS INSURANCE AND ANNUITY ASSOCIATION OF AMERICA
By: /s/ Roi X. Xxxxxx
------------------------
Name: Roi X. Xxxxxx
Title: Director - Special Situations
THE TRAVELERS INSURANCE COMPANY
By: /s/ Xxxxxx X. Xxxxxx
------------------------
Name: Xxxxxx X. Xxxxxx
Title: Investment Officer
(1996 Noteholders)
AUSA LIFE INSURANCE COMPANY, INC.
By: /s/ Xxxx Xxxxxx
------------------------
Name: Xxxx Xxxxxx
Title: Vice President
-24-
TRANSAMERICA LIFE INSURANCE COMPANY
By: /s/ Xxxx Xxxxxx
------------------------
Name: Xxxx Xxxxxx
Title: Vice President
JEFFERSON-PILOT LIFE INSURANCE COMPANY
By: /s/ Xxxxxx X. Xxxxxx, XX
------------------------
Name: Xxxxxx X. Xxxxxx, XX
Title: Vice President
FORTIS ASSET MANAGEMENT,
a division of Fortis, Inc.
By: /s/ Xxxxx Xxxxx
------------------------
Name: Xxxxx Xxxxx
Title: Vice President - Fixed Income
OXFORD LIFE INSURANCE COMPANY
By: /s/ Xxxxx X. Xxxx
------------------------
Name: Xxxxx X. Xxxx
Title: Treasurer
NATIONAL LIFE INSURANCE COMPANY
By: /s/ R. Xxxxx Xxxxxxx
------------------------
Name: R. Xxxxx Xxxxxxx
Title: Vice President, NL Capital Management
LIFE INSURANCE COMPANY OF THE SOUTHWEST
By: /s/ R. Xxxxx Xxxxxxx
------------------------
Name: R. Xxxxx Xxxxxxx
Title: Vice President, NL Capital Management
-25-
TEACHERS INSURANCE AND ANNUITY ASSOCIATION OF AMERICA
By: /s/ Roi X. Xxxxxx
------------------------
Name: Roi X. Xxxxxx
Title: Director - Special Situations
THE TRAVELERS INSURANCE COMPANY
By: /s/ Xxxxxx X. Xxxxxx
------------------------
Name: Xxxxxx X. Xxxxxx
Title: Investment Officer
-26-
ANNEX A
AMENDMENTS TO NOTE PURCHASE AGREEMENTS AND GUARANTY AGREEMENTS
The following Sections of the Note Purchase Agreements and Guaranty
Agreements shall be modified as set forth below.
1. AMENDMENTS TO THE NOTE PURCHASE AGREEMENTS.
a. ARTICLE 6. Sections 6.5, 6.8, 6.9 and 6.10 of the Note Purchase
Agreements shall be amended and restated in their entirety as follows:
"6.5 CONSOLIDATION, MERGER, SALE OF ASSETS, ETC. The Issuer will not
voluntarily liquidate or dissolve, or (whether in a single transaction or a
series of transactions) consolidate or merge with any other Person, or permit
any other Person to consolidate or merge with it, or sell, lease, transfer or
otherwise dispose of all or substantially all of its properties or assets
(whether now owned or hereafter acquired) to any other Person; provided,
however, that the foregoing provisions of this Section 6.5 shall not apply to
the Newco Transaction described in, and consented to by the Noteholders pursuant
to, Section 7.1 of the Override Agreement."
"6.8 NATURE OF BUSINESS. The Issuer will not, and will not permit any
Subsidiary to, engage in any line of business in which it is not currently
engaged or otherwise alter its manner of conducting business if as a result
thereof the business of the Issuer and its Subsidiaries taken as a whole would
be substantially changed from the general nature of the business of the Issuer
and its Subsidiaries as of the date of the Memorandum, as described therein.
Notwithstanding the foregoing terms of this SECTION 6.8, the Issuer shall
not acquire or invest in any new golf course properties or ancillary businesses
or engage in any of the other items identified in this SECTION 6.8, PROVIDED,
HOWEVER, that the Issuer shall have the right to enter into Section 1031
Transactions as set forth in the 1999 Credit Agreement, pay for capital
expenditures which the Issuer has already budgeted or which are necessary to
maintain the quality of the Projects or make remedial maintenance and
improvements to the extent reasonably necessary to maintain the Projects in a
first class manner, purchase office equipment and otherwise operate in the
ordinary course of business (other than with respect to the acquisition of or
investment in any new golf course properties or ancillary businesses) as
required for it to conduct its business."
"6.9 MAINTENANCE OF LEASES. The Issuer will not, and will not permit any
Restricted Subsidiary to, change, waive, discharge or terminate any Existing
Lease or any provision thereof, except that the Issuer or any Restricted
Subsidiary may change or waive any provision of, and may discharge and
terminate, an Existing Lease if in the good faith judgment of the Independent
Directors of the General Partner such change or waiver, discharge or
termination, is in the best interest of the Issuer or such Restricted
Subsidiary or is required to maintain the Guarantor's status as a real estate
investment trust under the Code and the consequences of such change or waiver,
discharge or termination, would not, in the aggregate as to any one or more
Existing Leases, be materially disadvantageous to the holders of the Notes;
PROVIDED, HOWEVER, that in no event may the Issuer or any Subsidiary change or
waive any provision of any Existing Lease relating to Assignment, Subletting or
Change of Control (as each is defined in the Existing Leases), except for
changes or waivers the consequences of which would, in the aggregate as to any
one or more Existing Leases, be more favorable to the Issuer or such Restricted
Subsidiary than would arise in the absence of such changes or waivers and,
PROVIDED FURTHER, THAT, any Existing Lease or any provision thereof may be
changed, waived, discharged or terminated in connection with the sale, transfer
or other disposition of the related property which is permitted under the terms
hereof. The Issuer will not change the designation of any Subsidiary in
existence on the date hereof from an Unrestricted Subsidiary to a Restricted
Subsidiary unless any change to or waiver of the provisions of, or discharge or
termination of, any Existing Leases of such Subsidiary would have been in
compliance with the terms of this SECTION 6.9 had such Subsidiary been a
Restricted Subsidiary on the date of such change, waiver, discharge or
termination.
In addition to and notwithstanding the forgoing provisions of this SECTION
6.9, the Borrower shall not, without the prior written consent of the Required
Lenders, modify, amend, or terminate any Approved Operating Lease if such
modification, amendment or termination is reasonably anticipated to be adverse
to the Borrower or Lenders in any material respect except to the extent
permitted under the Rent Deferral Agreement attached as Exhibit C to the
Override Agreement provided however that it is understood that any amendment to
such Rent Deferral Agreement shall be subject to the prior written consent of
the Required Noteholders.
"6.10 RESTRICTED PAYMENTS. The Issuer will not, directly or indirectly, and
will not permit any Restricted Subsidiary (other than a Wholly-Owned Subsidiary)
to, declare or make any Distribution unless, at the time of and immediately
after effect has been given to such declaration and the making of such
Distribution, no condition or event shall exist which constitutes a Default or
an Event of Default.
Notwithstanding anything in this SECTION 6.10, neither Guarantor nor the
Issuer shall pay any dividends or make any other distributions with respect to
its Capital Stock (including all preferred units of the Issuer) except that, so
long as there is not a continuing Major Default under Section 6.1(a) of the
Override Agreement with respect to Section 8.1(a) or (b) of the Note Purchase
Agreements, the Guarantor and the Issuer may make (i) distributions with respect
to taxes related to the sale of assets as described in the definition of "Net
Cash Proceeds" (including distributions required under the Operating Agreement
in respect of taxes), (ii) distributions to the holders of partnership interests
in the Issuer that are entitled to any preference in distribution to the extent
of any "Preferred
A-2
Distribution Shortfall" (as defined in the Operating Agreement) and any
preferred distribution for the then-current quarter as provided in clauses (1)
and (2) of the first sentence of Section 5.1 of the Operating Agreement and
(iii) whatever amount of dividends Guarantor is required to distribute to
maintain its tax status as a real estate investment trust and to avoid the
imposition of any corporate income or excise tax on Guarantor."
b. ARTICLE 9. The following definitions shall be added to the Note
Purchase Agreements:
"AGC COMPANIES" means, prior to accounting for minority interest, AGC and
its subsidiaries, GEI and its subsidiaries, American Golf of Glendale, a
California corporation, Kansas 19th Hole Corporation, a Kansas corporation, and
private liquor clubs related to the properties operated by the aforementioned
entities.
"AGREEMENT" shall mean this Note Purchase Agreement (together with the
Annex, Schedules and Exhibits hereto) as it may be from time to time amended,
modified or supplemented in accordance with its terms, and as amended by the
Override Agreement and supplemented by the Collateral Agency Agreement.
"APPROVED OPERATING LEASE" means an operating lease for a Project with an
Approved Operator, which lease (I) has been approved or (II) is in substantially
the form of the form operating lease which has theretofore been approved
pursuant to the 1999 Credit Agreement prior to the effective date of the
Extension Agreement, with no changes thereto that would reasonably be
anticipated to adversely affect the Issuer in any material respect.
"APPROVED OPERATOR" means each Person listed on Schedule 3 to the 1999
Credit Agreement and each other tenant under an operating lease for a Project
which tenant has been approved pursuant to the 1999 Credit Agreement prior to
the effective date of the Extension Agreement.
"CAPITAL STOCK" means any and all shares, interests, participations or
other equivalents (however designated) of capital stock of a corporation, any
and all equivalent ownership interests in a Person which is not a corporation
and any and all warrants or options to purchase any of the foregoing.
"COLLATERAL" shall have the meaning set forth in the Collateral Agency
Agreement.
"COLLATERAL AGENCY AGREEMENT" shall mean the Security and Collateral
Agency Agreement among the Issuer, the Noteholders, certain other noteholders
party to a separate note purchase agreement with the Issuer, BNY Midwest Trust
Company as collateral agent thereto and Bank One, N.A. as agent for the lenders
to the 1999 Credit Agreement.
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"EXTENSION AGREEMENT" shall mean the Amendment and Extension of Credit
Agreement dated as of June28, 2002 by and among the Administrative Agent, the
Issuer, the General Partner and the lenders to the 1999 Credit Agreement.
"GEI" means Golf Enterprises, Inc., a Kansas corporation.
"MAJOR DEFAULT" shall have the meaning set forth in the Override
Agreement
"NET CASH PROCEEDS" shall mean, with respect to any sale, transfer or
other disposition of any asset or the sale or issuance of any Indebtedness or
stock, partnership interests or other ownership interests or warrants, rights or
options to acquire any of the same by the Issuer, General Partner or any of
their subsidiaries, the aggregate amount of cash received from time to time by
or on behalf of the Issuer or the General Partner or any of their subsidiaries,
in connection with such transaction after deducting therefrom only (a)
reasonable and customary brokerage commissions, underwriting fees and discounts,
legal fees, finder's fees and other similar fees and commissions that are (1)
actually paid to a Person that is not an Affiliate of the Issuer or the General
Partner and (2) properly attributable to such transaction or to the asset that
is the subject thereof, (b) the amount of taxes payable in connection with or as
a direct result of such transaction, (c) in the case of a sale or disposition of
assets, the amount of any distributions required to be made in order to avoid
the imposition of any corporate level income or excise tax, (d) in the case of a
sale or disposition of assets, distributions in respect of taxes required under
Section 7.1(A)(3) of the Operating Agreement of the Issuer, provided that no
deduction shall be made on account of any such distributions to the General
Partner, except to the extent permitted under clauses (b) or (c) above, and
provided further that no deduction shall be made on account of clauses (b), (c)
or (d) if a Major Default has occurred and is then continuing, (e) the amount of
any indebtedness secured by a lien on such asset that, by the terms of such
transaction or such indebtedness, is required to be repaid upon such disposition
which is actually paid to a Person that is not an Affiliate of the Issuer or the
General Partner, and (f) any amount required to be paid to AGC or GEI in
connection with termination of an Approved Operating Lease on such asset,
pursuant to the formula described in Schedule 4 attached to the Extension
Agreement.
"NOTEHOLDERS" shall mean the holders from time to time of the Notes.
"OPERATING AGREEMENT" shall mean the Third Amended and Restated Agreement
of Limited Partnership, dated as of July 28, 1999, as amended, with respect to
the Issuer.
"OVERRIDE AGREEMENT" shall mean the Note Purchase Override Agreement dated
as of June 28, 2002 among the Issuer, the General Partner and the noteholders
party thereto.
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"PROJECT" means any real estate asset owned or operated by the Issuer,
General Partner, or any Subsidiary and operated or intended to be operated as,
or ancillary to, a golf course.
"RENT DEFERRAL AGREEMENT" shall have the meaning set forth in SECTION 6.9
hereto.
"REQUIRED NOTEHOLDERS" shall mean, as of any date, the then current
holders of at least 66-2/3% of the outstanding principal amount of the Notes
(exclusive of any Notes owned, directly or indirectly, by any one or more of the
Issuer, the General Partner or any subsidiary or Affiliate of the Issuer or the
General Partner, or any officer or director thereof), provided, that, if there
is then no principal amount of the Notes outstanding (exclusive of any Notes
owned, directly or indirectly, by any one or more of the Issuer, the General
Partner or any subsidiary or Affiliate of the Issuer of the General Partner, or
any officer or director thereof), but accrued Makewhole Amounts are still
outstanding with respect to such Notes, Required Noteholders shall mean the
holders of at least 66 2/3% of the accrued Makewhole Amounts that are
outstanding with respect to such Notes (exclusive of any Makewhole Amounts
accrued with respect to any such Notes owned, directly or indirectly, by any one
or more of the Issuer, the General Partner or any subsidiary or Affiliate of the
Issuer or the General Partner, or any officer or director thereof).
"SECTION 1031 TRANSACTION" means any transaction or series of related
transactions which qualifies as an exchange pursuant to Section 1031 of the
Code.
"1999 CREDIT AGREEMENT" shall mean the Credit Agreement, as amended by the
Extension Agreement, but without giving effect to any subsequent amendments,
modifications, restatements and supplements thereto that have not been consented
to by each of the Required Noteholders.
2. AMENDMENT TO GUARANTY AGREEMENTS.
(a) Notwithstanding anything to the contrary set forth in the Guaranty
Agreements, the Newco Transaction consented to in Section 7.1 of the
Override Agreement shall be deemed not to violate Sections 4.01(h), 4.02
and 4.05 of the Guaranty Agreements or any provision thereof.
(b) Notwithstanding anything to the contrary set forth in the Guaranty
Agreements, the definition of "Agreements" in each of the Guaranty
Agreements shall be amended to include the respective Note Purchase
Agreement as amended, modified or supplemented from time to time, including
as amended, modified or supplemented by the terms of each of the Override
Agreement and the Collateral Agency Agreement and it being understood, for
the avoidance of doubt, that the definition of "Obligations" in each of the
Guaranty Agreements shall be amended
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to include obligations of the Issuer under each of the Override Agreement
and Collateral Agency Agreement, all of which obligations are guaranteed by
the Guarantor pursuant to each of the Guaranty Agreements
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