SECOND AMENDMENT TO LOAN AND SECURITY AGREEMENT
EXHIBIT
10.101
SECOND
AMENDMENT TO
THIS
SECOND AMENDMENT TO LOAN AND SECURITY AGREEMENT (this “Amendment”), dated
as of February 9, 2005, but effective as of October 13, 2004, is made by and
among CNL
HOSPITALITY PARTNERS, LP, a limited partnership organized under the laws of the
state of Delaware (the “Borrower”); CNL
HOTELS & RESORTS, INC., a corporation organized under the laws of the State
of Maryland (“CNL
REIT”) as a
Guarantor; DEUTSCHE BANK TRUST COMPANY AMERICAS (“DBTCA”), as a
Lender and as administrative agent for the Lenders (in such capacity, the
“Administrative
Agent”); and
the other Lenders party to the Loan Agreement (as hereinafter
defined).
R E C I T
A L S:
Borrower
and DBTCA are parties to a Loan and
Security Agreement, made and dated as of the 13th day of
October, 2004, by and among Borrower, CNL REIT, the Lenders from time to time
party thereto, and Administrative Agent, as amended by a First Amendment to Loan
and Security Agreement dated as of December 7, 2004 (as so amended, the
“Loan
Agreement”). Terms
used but not defined herein shall have the respective meanings ascribed to such
terms in Annex 1 to the Loan Agreement (the “Glossary”), as
amended hereby.
The
parties hereto have agreed to amend certain provisions of the Loan Agreement as
herein provided.
NOW,
THEREFORE, in consideration of Ten Dollars ($10.00) and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereto agree as follows, effective as of the date hereof:
Section
1. Cash
Management Collateral Accounts.
1.1 Each of
Section 8.1 of the Loan Agreement and the Glossary is amended hereby to delete
all references to the Debt Service Account. In furtherance of the deletion of
the concept of the Debt Service Account, Paragraph (4) of Section 8.1 of the
Loan Agreement is amended hereby to read as follows:
“(4) Disbursements
from Collateral Account.
“(i) Subject
to Section
8.1(1), the
Borrower hereby irrevocably authorizes the Administrative Agent to transfer or
allocate, as applicable, and the Administrative Agent shall transfer or allocate
(or cause DBTCA to transfer or allocate pursuant to disbursement instructions
from the Administrative Agent), as applicable, from the Payments Account, funds
in the amounts, at the times and in the order of priority, as
follows:
“(a) for the
payment of Debt Service funds equal all interest to be paid on the next
applicable Payment Dates in respect of all Interest Periods then outstanding
(e.g., in the event there are multiple Interest Periods then outstanding, the
amount deposited would equal the aggregate of all sums payable on the next
Payment Date applicable to each such Interest Period);
“(b) during
any Low DSCR Period or if a Noticed Event of Default shall have occurred and is
then continuing, on the 15th day of
each calendar month (or the next succeeding Business Day with respect to any
month in which the 15th day is
not a Business Day), funds in an amount equal to the balance (if any) deposited
in the Payments Account to the extent remaining after the foregoing allocation
set forth in Section
8.1(4)(i)(a) and
apply the same, to the prepayment of the Loan and payment of accrued but unpaid
interest on the amount prepaid, pursuant to Sections 3.3.(2)(E) and
3.3(3) (and all
amounts payable pursuant to Section 2.8 as a
result of such prepayment); and
“(c) provided
no Noticed Event of Default or Low DSCR Period shall have occurred and is then
continuing, on the 1st day of
each calendar month (or the next succeeding Business Day with respect to any
month in which the 1st day is not a Business Day), funds in an amount equal to
the balance (if any) deposited in the Payments Account to the extent remaining
after the foregoing allocation and deposit set forth in Sections
8.1(4)(i)(a) through
(b) (the
“Excess
Cash Flow”) and
transfer the same to the Borrower’s Account free of any Lien or continuing
security interest.
“(ii) Not less
than five (5) days prior to each Payment Date, Administrative Agent shall notify
the Borrower of the balance on deposit in the Payments Account (or in the
Suspense Account) allocated for the payment of Debt Service as of such notice
date. On any Payment Date, any deficiency in amounts on deposit in the Payments
Account (or in the Suspense Account) relative to the Debt Service required to be
paid on such date shall constitute an Event of Default hereunder; provided, that if
the Administrative Agent has not provided timely notice of the balance on
deposit in the Payments Account (or in the Suspense Account) allocated for the
payment of Debt Service prior to such Payment Date pursuant to the preceding
sentence, such Event of Default will only occur if the Debt Service required to
be paid on such Payment Date remains unpaid in full five (5) days following the
earlier of the date such notice is provided or the date the notice contemplated
by the following sentence is provided. Upon the occurrence of a deficiency in
the Payments Account (or in amounts held in the Suspense Account) allocated for
the payment of Debt Service on any Payment Date relative to the Debt Service
required to be paid on such date, Administrative Agent shall notify Borrower of
said deficiency within five (5) Business Days thereafter; provided,
however,
Administrative Agent’s failure to notify Borrower shall not be deemed a waiver
of any Event of Default arising from such deficiency. Notwithstanding anything
to the contrary contained in this Agreement or in the other Loan Documents, no
Event of Default shall be deemed to have occurred hereunder or thereunder (and
no Default Rate shall be applicable) in the event funds sufficient for a
required transfer are held in an appropriate Collateral Account and the
Administrative Agent or DBTCA fails to timely make any transfer from such
Collateral Account as contemplated by this Agreement.
“(iii) Notwithstanding
anything to the contrary contained herein or in the Security Instruments, but
subject to Section
7.4(3), to the
extent that the Borrower shall fail to pay any mortgage recording tax, costs,
expenses or other amounts pursuant to Section
7.1(23) of this
Agreement within the time period set forth therein, the Administrative Agent
shall have the right, at any time, upon five (5) Business Days’ notice to the
Borrower, to withdraw from funds constituting Excess Cash Flow in the Payments
Account, an amount equal to such unpaid taxes, costs, expenses and/or other
amounts and pay such amounts to the Person(s) entitled thereto.
“(iv) Subject
to Section
8.1(1), the
Borrower irrevocably authorizes the Administrative Agent to make and, provided
no Event of Default shall have occurred and be continuing, the Administrative
Agent hereby agrees to make, to the extent of the monies on deposit in the
Payments Account allocated for payment of Debt Service, payment of funds from
such account to the Administrative Agent sufficient to pay Debt Service on each
Payment Date, and the Administrative Agent, on each Payment Date, shall apply
such funds to the payment of the Debt Service payable on such Payment
Date.”
1.2 The
definition of “Debt Service Account” in the Glossary is deleted hereby.
Section
2. Refinancing
of the Hotel del Coronado.
2.1 Notwithstanding
anything to the contrary contained in the Loan Agreement, in the event that a
refinancing of the existing Indebtedness secured by the Project commonly known
as the “Hotel del Coronado” for a maximum cumulative principal amount of up to
$410,000,000 (the “HDC
Refinancing”) is
consummated, the Net Cash Proceeds of the HDC Refinancing shall not be required
to be applied to the prepayment of the outstanding principal balance of the Loan
under Section 3.3(2)(C) of the Loan Agreement but may be used for any general
corporate purpose of CNL REIT, Borrower or any of their respective Subsidiary
Entities.
Section
3. Glossary
Modifications.
3.1 The
definition of “Cash Available for Distribution” in the Glossary is amended
hereby to read as follows:
“Cash
Available for Distribution” shall
mean, for any period, (i) EBITDA for such period, less (ii) the
aggregate amount of scheduled principal repayments on Indebtedness of the
Consolidated Entities required to be made during such period (other than
optional principal prepayments and Bullet Payments), less (iii)
Interest Expense payable during such period, less (iv) Tax
Expense payable during such period, less (v)
FF&E Reserves, plus (vi) any
amounts actually expended for FF&E
and other capital expenditures and deducted in determining Net
Income.
3.2 The
definition of “EBITDA” in the Glossary is amended hereby to read as follows:
“EBITDA” shall
mean, for any period, solely with respect to the Consolidated Entities, Net
Income, plus (without duplication) (A) Interest Expense, (B) Tax Expense, and
(C) Depreciation and Amortization Expense, in each case for such period,
provided that (x) EBITDA shall exclude minority interests and the results of
unconsolidated subsidiaries, and (y) with respect to Section 7.2(22)(A) of the
Loan Agreement, EBITDA for any period shall be adjusted on a pro forma basis to
include (or exclude) amounts attributable to hotel operations acquired (or sold)
during such period as if such acquisition (or disposition) had occurred on the
first day of such period.
3.3 The
definition of “FF&E Reserves” in the Glossary is amended hereby to read as
follows:
“FF&E
Reserves” shall
mean, with respect to any Mortgaged Property or Person for any period, and
without duplication, an assumed reserve for FF&E and other capital
expenditures equal to four percent (4%) of gross hotel operating revenues of
such Mortgaged Property or such Person’s Projects, as applicable, for such
period.
3.4 The
definition of “Permitted Debt” in the Glossary is amended hereby to delete the
word “and” at the end of clause (iv) and insert the following after clause (v):
“(vi) the HDC
Refinancing; and
“(vii) the TRS
Lease Guaranty.”
3.5 The
Glossary is amended hereby to add the following definition:
“TRS
Lease Guaranty” shall
mean the guaranty(ies) relating to the limited service Marriott-flagged Projects
commonly known as the Marriott Village Hotels at Little Xxxx Xxxxx, located in
Orange County, Florida (the “LLB Projects”), in the maximum aggregate amount of
the difference of (i) $6,000,000 per year minus (ii) the amount of all net cash
flow received by the LLB Lessee (as hereinafter defined) from the LLB Projects
during such year, made by CNL REIT and/or Borrower, as guarantor, to CNL LLB SHS
Management, LP, CNL LLB F-Inn Management, LP and CNL LLB C-Hotel Management, LP
(collectively, “LLB Lessor”), as the beneficiaries, of the rent obligations of
LLB Tenant Corporation or its successor(s) as the Subsidiary “TRS” tenant of the
LLB Projects (“LLB Lessee”) under the leases, dated on or about October 12,
2000, between LLB Lessor and LLB Lessee for the LLB Projects (the “LLB Leases”)
or any replacement “TRS” leases for the LLB Projects which replacement leases
have no greater minimum rent payable thereunder in aggregate than under the LLB
Leases.
Section
4. Merger
of RFS and Borrower.
4.1 Notwithstanding
anything to the contrary contained in the Loan Agreement (including, without
limitation, Sections 7.2 and 7.5 of the Loan Agreement), CNL REIT is permitted
hereby to effect one or more Transfers pursuant to which RFS Partnership, L.P.
shall be merged into or become a direct subsidiary of Borrower, and the
constituent and subsidiary entities of RFS Partnership, L.P. appropriately
merged into the balance of the CNL REIT
corporate structure consistent with the core organizational structure of CNL
REIT and Borrower, as CNL REIT’s “operating partnership.”
Section
5. Assignment
of the TRS Lease Guaranty.
5.1 In
conjunction with the recent restructuring of the management, LLB Leases and
operation of the LLB Projects, LLB Lessor may assign the TRS Lease Guaranty to
the lender (or agent for the lenders) under the Permitted Debt secured by the
LLB Projects if such assignment is required by such lender (or agent for the
lenders) as a condition of approval of such restructuring.
Section
6. Leverage.
6.1 The
preamble to Section 7.2(22)(A) is modified hereby to read as
follows:
“Maximum
Leverage. At any
time during the periods indicated below, the ratio of Total Liabilities as of
the end of the Fiscal Quarter then most recently ended to EBITDA for the four
Fiscal Quarters then most recently ended, shall not be less than the ratios set
forth below:”
Section
7. Expenses.
7.1 Borrower
hereby acknowledges and agrees that it shall be responsible for the payment of
any out-of-pocket costs, fees and expenses of Administrative Agent incurred in
connection with the preparation, negotiation, execution or delivery of this
Amendment (including, without limitation, the fees and disbursements of counsel
to Administrative Agent).
Section
8. Covenants,
Representations and Warranties.
8.1 Each of
Borrower and CNL REIT hereby remakes all of its respective representations and
warranties contained in the Loan Documents, as amended hereby, as of the date
hereof.
8.2 Each of
Borrower and CNL REIT hereby reaffirms all terms and covenants made in the Loan
Documents binding upon it as amended hereby or pursuant hereto.
8.3 Each of
Borrower and CNL REIT hereby represents and warrants to Administrative Agent and
the Lenders that (a) this Amendment and the Loan Agreement as modified and
amended hereby, constitute the legal, valid and binding obligation of Borrower
and CNL REIT, enforceable against Borrower and CNL REIT in accordance with their
terms, and (b) the execution and delivery by each of Borrower and CNL REIT of
this Amendment has been duly authorized by all requisite action on the part of
Borrower and CNL REIT and will not violate any provision of the organizational
documents of Borrower or CNL REIT.
8.4 Each of
Borrower and CNL REIT hereby represents and warrants to Administrative Agent and
the Lenders that, as of the date hereof, (a) to Borrower’s and CNL REIT’s
knowledge, no Event of Default has occurred and is continuing, and no Event of
Default will occur as a result of the execution, delivery and performance by
Borrower and CNL REIT of this Amendment and (b) none of the Transaction Parties
has any offsets, defenses, counterclaims, set offs, or similar rights with
respect to its obligations of payment and performance under the Loan
Documents.
Section
9. Effect
Upon Loan Documents.
9.1 Except as
specifically set forth herein, the Loan Documents shall remain in full force and
effect and are hereby ratified and confirmed. All references to the “Loan
Agreement” in the Loan Documents (or to “the Agreement” in the Loan Agreement)
shall mean and refer to the Loan Agreement as modified and amended
hereby.
9.2 The
execution, delivery and effectiveness of this Amendment shall not operate as a
waiver of any right, power or remedy of Administrative Agent or any Lender under
the Loan Documents, or any other document, instrument or agreement executed
and/or delivered in connection therewith.
Section
10. Governing
Law. THIS
AMENDMENT SHALL BE CONSTRUED, INTERPRETED AND GOVERNED BY THE LAW OF THE STATE
OF NEW YORK, WITHOUT REFERENCE TO ITS CONFLICT OF LAWS PRINCIPLES.
Section
11. Counterparts. This
Amendment may be executed in any number of counterparts, and all such
counterparts shall together constitute the same agreement.
[REST OF
PAGE INTENTIONALLY LEFT BLANK]
IN
WITNESS WHEREOF, the parties hereto have caused this Amendment to be executed as
of the day and year first above written.
BORROWER:
CNL HOSPITALITY
PARTNERS, LP,
a Delaware limited
partnership
By: CNL
HOSPITALITY GP CORP., a Delaware Corporation
Its: general
partner
By:
/s/ Xxxx X. Xxxxx, Xx.
Name: Xxxx X. Xxxxx,
Xx.
Title: Vice
President
CNL
REIT:
CNL
HOTELS & RESORTS, INC.,
a Maryland
corporation
By:
/s/ Xxxx X. Xxxxxx
Name: Xxxx X.
Xxxxxx
Title: Senior Vice
President
ADMINISTRATIVE
AGENT:
DEUTSCHE
BANK TRUST COMPANY AMERICAS
By: /s/
Xxxxxx X. Xxxxxxxx
Name: Xxxxxx X.
Xxxxxxxx
Title:
Vice President
LENDERS:
DEUTSCHE
BANK TRUST COMPANY AMERICAS
By:
/s/ Xxxxxx X. Xxxxxxxx
Name: Xxxxxx X.
Xxxxxxxx
Title: Vice
President
