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EXHIBIT 4(K)
THIRD AMENDMENT
TO CREDIT AGREEMENT
This THIRD AMENDMENT TO CREDIT AGREEMENT (this "THIRD AMENDMENT") is dated
as of October 27, 1999 and entered into by and among PRIME HOSPITALITY CORP., a
Delaware corporation ("COMPANY"), the financial institutions listed on the
signature pages hereof ("LENDERS"), SOCIETE GENERALE, SOUTHWEST AGENCY, as
Documentation Agent, CREDIT LYONNAIS NEW YORK BRANCH, as Syndication Agent and
BANKERS TRUST COMPANY, as agent for Lenders ("AGENT"), and, for purposes of
Section 4 hereof, the Credit Support Parties listed on the signature pages
hereof, and is made with reference to that certain Amended and Restated Senior
Secured Credit Agreement dated as of December 17, 1997, by and among Company,
Lenders, Documentation Agent, Syndication Agent and Agent, as amended or
otherwise modified by that certain First Amendment to Credit Agreement dated as
of February 23, 1998, that certain Limited Waiver to Credit Agreement dated as
of August 5, 1998, and that certain Second Amendment to Credit Agreement dated
as of September 24, 1998 (collectively, the "CREDIT AGREEMENT"). Capitalized
terms used herein without definition shall have the same meanings herein as set
forth in the Credit Agreement.
RECITALS
WHEREAS, Company and Lenders desire to amend the Credit Agreement in the
manner set forth below,
NOW, THEREFORE, in consideration of the premises and the agreements,
provisions and covenants herein contained, the parties hereto agree as follows:
SECTION 1. AMENDMENTS TO THE CREDIT AGREEMENT
1.1 AMENDMENTS TO SECTION 1: PROVISIONS RELATING TO DEFINED TERMS
A. The definition of the term "New Sources" set forth in subsection 1.1 of
the Credit Agreement is hereby amended by deleting it in its entirety and
substituting the following therefor:
"NEW SOURCES" means, as of any date of determination, the sum, without
duplication, of (a) Net Equity Proceeds and (b) Net Cash Proceeds derived from
any Asset Sale, less (i) any and all Supplemental Amounts expended from New
Sources pursuant to Subsection 5.19, (ii) any and all amounts expended from New
Sources pursuant to subsection 6.5 in connection with any Stock Repurchase
(exclusive of amounts expended pursuant to clause (i)(B) of subsection 6.5), and
(iii) two hundred percent (200%) of any and all amounts expended from New
Sources in connection with any Stock Repurchase pursuant to clause (i)(B) of
subsection 6.5."
B. Subsection 1.1 of the Credit Agreement is hereby amended by adding
thereto the following definition, which shall be inserted in proper alphabetical
order:
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"THIRD AMENDMENT EFFECTIVE DATE" shall have the meaning assigned to such
term in the Third Amendment to Credit Agreement dated as of October 27, 1999."
1.2 AMENDMENTS TO SECTION 6: FINANCIAL COVENANTS
Subsection 6.5 of the Credit Agreement is hereby amended by deleting it in
its entirety and substituting the following therefor:
"6.5 RESTRICTED PAYMENTS.
The Loan Parties shall not, and shall not permit any of their respective
Subsidiaries to, directly or indirectly, declare, order, pay, make, give, or
publish notice or fix a date in respect of or set apart any sum for any
Restricted Payment, enter into an agreement or make any commitment to effect
any of the foregoing or take any other similar action in furtherance of or
otherwise in connection with the foregoing; provided that, (i) if no Event of
Default or Potential Event of Default exists and Company would then be able to
incur $1 of additional Indebtedness pursuant to the Mortgage Note indenture (as
in effect on the Closing Date), Company may elect to make one or more Stock
Repurchases and pay dividends or make other distributions on shares or purchase
shares of Capital Stock of Company in an aggregate amount not to exceed
$25,000,000, except that Company may (A) at any time during the 1999 calendar
year make one or more Stock Repurchases in an aggregate amount not to exceed
$50,000,000 over and above the $25,000,000 amount otherwise permitted herein
and (B) at any time make one or more Stock Repurchases in an aggregate amount
not to exceed $100,000,000 over and above the $25,000,000 amount or the
$50,000,000 amount, as applicable, otherwise permitted herein, provided that (1)
each such Stock Repurchase pursuant to clause (A) or (B) above shall be effected
only through the use of New Sources and (2) the aggregate amount applied in
respect of any Stock Repurchase pursuant to clause (B) above, if any, shall not
exceed fifty percent (50%) of New Sources then available therefor; (ii) Company
and its Subsidiaries may make Restricted Payments (but not any voluntary
prepayments) in respect of Indebtedness permitted pursuant to subsection 6.1 in
accordance with, and to the extent required by, the terms and provisions of the
applicable Indebtedness; (iii) Company may prepay Indebtedness permitted
pursuant to subsection 6.1 with the proceeds of refinancing indebtedness
permitted pursuant to subsection 6.1(c); (iv) Company may prepay Indebtedness
permitted pursuant to subsection 6.1(d), provided that the aggregate amount of
principal payments prior to the Maturity Date in respect of such Indebtedness
shall not exceed $20,000,000; and (v) Company may prepay Indebtedness referred
to in clause (i) of the definition of the term "Net Cash Proceeds" contained in
Section 1.1."
SECTION 2. CONDITIONS TO EFFECTIVENESS
Section 1 of this Third Amendment shall become effective only upon the
satisfaction of all of the following conditions precedent (the date of
satisfaction of such conditions being referred to herein as the "THIRD AMENDMENT
EFFECTIVE DATE"):
A. On or before the Third Amendment Effective Date, Company shall deliver
to Agent executed copies of this Third Amendment (with sufficient originally
executed copies for each Lender and its counsel) dated the Third Amendment
Effective Date.
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B. On or before the Third Amendment Effective Date, all corporate and other
proceedings taken or to be taken in connection with the transactions
contemplated hereby and all documents incidental thereto not previously found
acceptable by Agent, acting on behalf of Lenders, and its counsel shall be
satisfactory in form and substance to Agent and such counsel, and Agent and such
counsel shall have received all such counterpart originals or certified copies
of such documents as Agent may reasonably request.
SECTION 3. COMPANY'S REPRESENTATIONS AND WARRANTIES
In order to induce Lenders to enter into this Third Amendment and to amend
the Credit Agreement in the manner provided herein, Company represents and
warrants to each Lender that the following statements are true, correct and
complete:
A. CORPORATE POWER AND AUTHORITY. Each of Company and the Subsidiary
Guarantors that are a party hereto have all requisite corporate power and
authority to enter into this Third Amendment and to carry out the transactions
contemplated by, and perform its respective obligations under, the Credit
Agreement as amended by this Third Amendment (the "AMENDED AGREEMENT").
B. AUTHORIZATION OF AGREEMENTS. The execution and delivery of this Third
Amendment and the performance of the Amended Agreement have been duly authorized
by all necessary corporate action on the part of Company and the Subsidiary
Guarantors, as the case may be.
C. NO CONFLICT. The execution and delivery by each of Company and the
Subsidiary Guarantors that are a party hereto of this Third Amendment and the
performance by Company of the Amended Agreement do not, and will not, (i)
violate any provision of any law or any governmental rule or regulation
applicable to Company or any of its Subsidiaries, the Certificate or Articles of
Incorporation or Bylaws of Company or any of its Subsidiaries or any order,
judgment or decree of any court or other agency of government binding on
Company or any of its Subsidiaries, (ii) conflict with, result in a breach of or
constitute (with due notice or lapse of time or both) a default under any
Contractual Obligation of Company or any of its Subsidiaries, (iii) result in or
require the creation or imposition of any Lien upon any of the properties or
assets of Company or any of its Subsidiaries (other than Liens created under any
of the Loan Documents in favor of Agent on behalf of Lenders), or (iv) require
any approval of stockholders or any approval or consent of any Person under any
Contractual Obligation of Company or any of its Subsidiaries, except for such
approvals or consents which have been obtained on or before the Third Amendment
Effective Date and disclosed in writing to Agent and Lenders.
D. GOVERNMENTAL CONSENTS. The execution and delivery by each of Company and
the Subsidiary Guarantors that are a party hereto of this Third Amendment and
any other operative document delivered pursuant to this Third Amendment and the
performance by Company of the Amended Agreement do not, and will not, require
any registration with, consent or approval of, or notice to, or other action to,
with or by, any federal, state or other governmental authority or regulatory
body.
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E. BINDING OBLIGATION. This Third Amendment and the Amended Agreement have
been duly executed and delivered by each of Company and the Subsidiary
Guarantors that are a party hereto, and will be legally valid and binding
obligations of Company and such Subsidiary Guarantors, enforceable against
Company and such Subsidiary Guarantors in accordance with their respective
terms, except as may be limited by bankruptcy, insolvency, reorganization,
moratorium or similar laws relating to or limiting creditors' rights generally
or by equitable principles relating to enforceability.
F. GOVERNMENTAL REGULATION; SECURITIES ACTIVITIES. Neither the making of
the Loans pursuant to the Amended Agreement nor the granting of a Security
Interest in any Collateral (as defined in the Security Agreement) pursuant to
the Security Documents violates Regulations T, U or X of the Board of Governors
of the Federal Reserve System. It is not necessary in connection with the
execution and delivery of this Third Amendment or the Amended Agreement to
register the Loans under the Securities Act or to qualify any indenture under
the Trust Indenture Act of 1939, as amended.
G. INCORPORATION OF REPRESENTATIONS AND WARRANTIES FROM CREDIT AGREEMENT.
The representations and warranties contained in Section 4 of the Credit
Agreement are and will be true, correct and complete in all material respects on
and as of the Third Amendment Effective Date to the same extent as though made
on and as of that date, except to the extent such representations and warranties
specifically relate to an earlier date, in which case they were true, correct
and complete in all material respects on and as of such earlier date.
H. ABSENCE OF DEFAULT. No event has occurred and is continuing or will
result from the consummation of the transactions contemplated by this Third
Amendment that would constitute an Event of Default or a Potential Event of
Default.
SECTION 4. ACKNOWLEDGEMENT AND CONSENT
Each Credit Support Party hereby acknowledges that it has reviewed the
terms and provisions of the Credit Agreement and this Third Amendment and
consents to the amendment of the Credit Agreement effected pursuant to this
Third Amendment. Each Credit Support Party hereby confirms that each Credit
Support Document to which it is a party or otherwise bound and all Collateral
encumbered thereby will continue to guaranty or secure, as the case may be, to
the fullest extent possible the payment and performance of all "Guarantied
Obligations" and "Secured Obligations," as the case may be (in each case as such
terms are defined in the applicable Credit Support Document), including without
limitation the payment and performance of all such "Guarantied Obligations" or
"Secured Obligations," as the case may be, in respect of the Obligations of
Company now or hereafter existing under or in respect of the Amended Agreement
and the Notes defined therein.
Each Credit Support Party acknowledges and agrees that any of the Loan
Documents and the Credit Support Documents to which it is a party or otherwise
bound shall continue in full force and effect and that all of its obligations
thereunder (which obligations on the date hereof remain absolute and
unconditional and are not subject to any defenses, set-offs or counterclaims)
shall be valid and enforceable and shall not be impaired or limited by the
execution or effectiveness of this Third Amendment. Each Credit Support Party
represents and
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warrants that all representations and warranties contained in the Amended
Agreement and the Credit Support Documents to which it is a party or otherwise
bound are true, correct and complete in all material respects on and as of the
Third Amendment Effective Date to the same extent as though made on and as of
that date, except to the extent such representations and warranties specifically
relate to an earlier date, in which case they were true, correct and complete
in all material respects on and as of such earlier date.
Each Credit Support Party (other than Company) acknowledges and agrees
that (i) notwithstanding the conditions to effectiveness set forth in this Third
Amendment, such Credit Support Party is not required by the terms of the Credit
Agreement or any other Loan Document to consent to the amendments to the Credit
Agreement effected pursuant to this Third Amendment and (ii) nothing in the
Credit Agreement, this Third Amendment or any other Loan Document shall be
deemed to require the consent of such Credit Support Party to any future
amendments to the Credit Agreement.
SECTION 5. MISCELLANEOUS
A. REFERENCE TO AND EFFECT ON THE CREDIT AGREEMENT AND THE OTHER LOAN
DOCUMENTS.
(i) On and after the Third Amendment Effective Date, each reference in the
Credit Agreement to "this Agreement", "hereunder", "hereof", "herein" or
words of like import referring to the Credit Agreement, and each reference
in the other Loan Documents to the "Credit Agreement", "Thereunder",
"Thereof" or words of like import referring to the Credit Agreement shall
mean and be a reference to the Amended Agreement.
(ii) Except as specifically amended by this Third Amendment, the Credit
Agreement and the other Loan Documents shall remain in full force and
effect and are hereby ratified and confirmed.
(iii) The execution, delivery and performance of this Third Amendment
shall not, except as expressly provided herein, constitute a waiver of any
provision of, or operate as a waiver of any right, power or remedy of
Agent or any Lender under, the Credit Agreement or any of the other Loan
Documents.
B. FEES AND EXPENSES. Company acknowledges that all costs, fees and
expenses as described in subsection 8.2 of the Credit Agreement incurred by
Agent and its counsel with respect to this Third Amendment and the documents and
transactions contemplated hereby shall be for the account of Company. Without
limiting the generality of the foregoing, and in addition to any other costs,
fees and expenses required to be paid by Company hereunder or under the Credit
Agreement or the other Loan Documents, Company agrees that it shall pay to each
Lender that consents to this Third Amendment an amount equal to the product of
(i) four hundredths of one percent (0.04%) and (ii) such Lender's Pro Rata Share
of the aggregate amount of the Commitments.
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C. EXHIBITS. The Credit Agreement is hereby further amended as follows:
(i) Exhibit XVI and Exhibit XVII to the Credit Agreement shall mean the exhibits
attached to the First Amendment as Annex D and Annex B thereto, respectively;
and (ii) the phrase "Exhibit XVI" in the definition of the term "Development
Plan" set forth in subsection 1.1 of the Credit Agreement is hereby deleted and
the phrase "Exhibit XVIII" substituted therefor.
D. HEADINGS. Section and subsection headings in this Third Amendment are
included herein for convenience of reference only and shall not constitute a
part of this Third Amendment for any other purpose or be given any substantive
effect.
E. APPLICABLE LAW. THIS THIRD AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF
THE PARTIES HEREUNDER SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED
IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK (INCLUDING
WITHOUT LIMITATION SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF
NEW YORK), WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES.
F. COUNTERPARTS; EFFECTIVENESS. This Third Amendment may be executed in
any number of counterparts and by different parties hereto in separate
counterparts, each of which when so executed and delivered shall be deemed an
original, but all such counterparts together shall constitute but one and the
same instrument; signature pages may be detached from multiple separate
counterparts and attached to a single counterpart so that all signature pages
are physically attached to the same document. This Third Amendment shall become
effective upon the execution of a counterpart hereof by Company, Lenders and
each of the Credit Support Parties and receipt by Company and Agent of written
or telephonic notification of such execution and authorization of delivery
thereof.
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IN WITNESS WHEREOF, the parties hereto have caused this Third Amendment to
be duly executed and delivered by their respective officers thereunto duly
authorized as of the date first written above.
PRIME HOSPITALITY CORP.
By: /s/ XXXXXXX XXXXXX
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Name: Xxxxxxx Xxxxxx
Title: SVP & CFO
HOMEGATE AUSTIN, INC.,
(for purposes of Section 4 only) as a Credit Support
Party
By: /s/ XXXXXXX XXXXXX
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Name: Xxxxxxx Xxxxxx
Title: President
HOMEGATE HOSPITALITY, INC.,
(for purposes of Section 4 only) as a Credit Support
Party
By: /s/ XXXXXXX XXXXXX
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Name: Xxxxxxx Xxxxxx
Title: President
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BANKERS TRUST COMPANY,
as Agent and as a Lender
By: /s/ XXXXX XXXXXXX
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Name: Xxxxx Xxxxxxx
Title: Principal
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CREDIT LYONNAIS NEW YORK BRANCH,
as Syndication Agent and as a Lender
By: /s/ BRUNO DeFLOOR
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Name: BRUNO DeFLOOR
Title: VICE PRESIDENT
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XXXXXXX XXXXXXXX, XXXXXXXXX
AGENCY,
as Documentation Agent and as a Lender
By: /s/ HUVISHKA ALI
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Name: HUVISHKA ALI
Title: VICE PRESIDENT
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BANK LEUMI USA,
as a Lender
By: /s/ XXXXXXX X. XXXXXX
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Name: XXXXXXX X. XXXXXX
Title: AVP
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BANKBOSTON, N.A.,
as a Lender
By: /s/ XXXXXX X. XXXX
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Name: Xxxxxx X. Xxxx
Title: Director
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BANK ONE, TEXAS NATIONAL
ASSOCIATION,
as a Lender
By: /s/ XXXXXXX X. XXXXX
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Name:
Title:
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CIBC, INC.,
as a Lender
By: /s/ XXXX X. XXXXXX
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Name: Xxxx X. Xxxxxx
Title: Executive Director
CIBC World Markets Corp., AS AGENT
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IMPERIAL BANK,
as a Lender
By: /s/ XXXXXX X. XXXXXXX
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Name: XXXXXX X. XXXXXXX
Title: SENIOR VICE PRESIDENT
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BANK OF AMERICA, N.A.,
f/k/a NATIONSBANK, N.A.,
as a Lender
By: /s/ XXXX XXXXX
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Name: Xxxx Xxxxx
Title: Vice President
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ORIX USA CORPORATION,
as a Lender
By: /s/ KAZUSOSTIA KAWABATA
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Name: Kazusostia Kawabata
Title: Vice President
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PNC BANK, N.A.,
as a Lender
By: /s/ XXXXXXX X. XxXXXXX
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Name: XXXXXXX X. XxXXXXX
Title: VICE PRESIDENT
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SOUTHERN PACIFIC BANK,
as a Lender
By: /s/ XXXXXXXX XXX
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Name: XxxXxxxx Xxx
Title: Vice President
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