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EXHIBIT 10(29)
FIRST AMENDMENT TO
CREDIT AGREEMENT
THIS FIRST AMENDMENT TO CREDIT AGREEMENT, dated as of the 16th day of
January, 1998 (this "First Amendment"), to the Credit Agreement referred to
below is entered into by and among SHOLODGE, INC., a corporation organized under
the laws of Tennessee ("ShoLodge"), the Subsidiaries of ShoLodge party hereto
(the "Subsidiary Borrowers", and together with ShoLodge, the "Borrowers"), the
Lenders party hereto (the "Lenders"), FIRST UNION NATIONAL BANK (f/k/a FIRST
UNION NATIONAL BANK OF TENNESSEE), as Administrative Agent for the Lenders (the
"Administrative Agent"), and NATIONSBANK OF TENNESSEE, N.A., as Co-Agent for the
Lenders (the "Co-Agent").
Statement of Purpose
Pursuant to the Credit Agreement dated as of April 30, 1997 (as
supplemented by the Joinder Agreement No. 1 dated as of June 11, 1997, as
supplemented by the consent and waiver letter dated November 14, 1997, and as
further amended, restated, supplemented or otherwise modified, the "Credit
Agreement") by and among the Borrowers, the Lenders party thereto. the
Administrative Agent and the Co-Agent, the Lenders agreed to extend certain
loans to the Borrowers as more particularly described therein.
Pursuant to the Purchase and Sale Agreement dated as of October 24,
1997 (the "Purchase and Sale Agreement") by and among ShoLodge and certain of
its Subsidiaries (the "Sellers") and Hospitality Properties Trust (the
"Purchaser"), the Sellers have agreed to sell, and the Purchaser has agreed to
purchase, certain properties, and the Sellers have agreed to assign, and the
Purchaser has agreed to assume, certain interests under a ground lease, as more
particularly described therein.
Pursuant to the Agreement to Lease dated as of October 24, 1997 (the
"Agreement to Lease" and together with the Purchase and Sale Agreement, the
"Primary Sale-Leaseback Agreements") by and between ShoLodge and the Purchaser,
HPT Suite Properties Trust, a Wholly-Owned Subsidiary of the Purchaser (the
"Landlord"), has agreed to lease to Suite Tenant, Inc.. a Wholly-Owned
Subsidiary of ShoLodge (the "Tenant"), and the Tenant has agreed to lease from
the Landlord, certain properties as more particularly described therein.
In connection with the Primary Sale-Leaseback Agreements, the following
documents (substantially in the form attached as Exhibits to the Agreement to
Lease) were executed: (i) the Lease Agreement dated as of November 19, 1997 (the
"Lease") by and between the Landlord and the Tenant, (it) the Security Agreement
dated as of November 19, 1997 (the "Security Agreement") by and between the
Landlord and the Tenant, (iii) the Assignment and Security Agreement dated as of
November 19, 1997 (the "Assignment and Security Agreement") by and between the
Landlord and the Tenant, (iv) the Stock Pledge dated as of November 19, 1997
(the "Pledge") made by ShoLodge in favor of the Landlord and (v) the Limited
Guaranty Agreement dated as of November 19, 1997 (the "Guaranty Agreement", and
together with the Lease, the Security Agreement, the Assignment and Security
Agreement, the Pledge and the Guaranty Agreement, the "Additional
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Sale-Leaseback Agreements") made by ShoLodge in favor of the Landlord. The
Primary Sale-Leaseback Agreements and the Additional Sale-Leaseback Agreements
shall be collectively referred to as the "Sale-Leaseback Agreements".
In connection with the series of transactions set forth in
Sale-Leaseback Agreements (the "Sale-Leaseback Transactions"), ShoLodge has
created the Tenant for the purpose of leasing certain properties from the
Landlord.
The Borrowers have requested, and the Agent, the Co-Agent and the
Lenders have agreed, to amend the Credit Agreement to provide for, among other
matters, (i) the confirmation and acceptance of the Sale-Leaseback Transactions,
(it) certain amendments to the financial covenants provided for in Article IX of
the Credit Agreement and (iii) certain other amendments provided for herein,
said amendment being pursuant to the terms and conditions of this First
Amendment.
NOW THEREFORE, in consideration of tile premises and other good and
valuable consideration, the parties hereto hereby agree as follows:
1.01 Capitalized Terms. Except as otherwise provided in this First
Amendment, all capitalized undefined terms used in this First Amendment shall
have the meanings assigned thereto in the Credit Agreement.
2.01 Schedules. Attached hereto are updated versions of Schedules
6.1(a), 6.1(b) and 8.12 referenced in the Credit Agreement, which schedules have
been revised to include all information required to be provided therein with
respect to the Tenant.
3.01 Amendments to Credit Agreement.
(a) Amendment to Existing Definitions. The definitions of the
quoted terms set forth below which are set out in Section 1.1 of the Credit
Agreement are hereby amended in their entirety to read as follows:
"Agreement" means this Credit Agreement, as supplemented by
the Joinder Agreement No. 1 dated as of June 11, 1997, as supplemented
by the consent and waiver letter dated November 14, 1997, as amended by
the First Amendment to Credit Agreement dated as of January 16, 1998,
and as further amended, restated, supplemented or otherwise modified
from time to time.
(b) Additional Defined Terms. Section 1.1 of the Credit
Agreement is further amended by the addition of the following definitions:
"EBITDAR" means, with respect to ShoLodge and its Subsidiaries
for any period, the following, calculated on a Consolidated basis
without duplication for such period in accordance with GAAP: (a) EBITDA
plus (b) to the extent deducted in the determination of Net Income, HPT
Lease Payments.
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"First Amendment" means the First Amendment to Credit Agreement dated
as of January 16, 1998 by and among the Borrowers, the Lenders, the
Administrative Agent and the Co-Agent.
"HPT Lease Payments" means the amount of the gross rental and other
lease payments (excluding the reimbursement of expenses paid by the landlord
thereunder) made by Suite Tenant, Inc., a Wholly-Owned Subsidiary of ShoLodge,
to HPT Suite Properties Trust pursuant to the Lease net of interest income
credited against such payments pursuant to the Sale~Leaseback Agreements.
"Lease" means the Lease Agreement dated as of November 19, 1997 by and
between HPT Suite Properties Trust and Suite Tenant, Inc., a Wholly-Owned
Subsidiary of ShoLodge.
"Operating Lease" means, with respect to ShoLodge and its Subsidiaries,
any lease of any property (including the Lease) that should, in accordance with
GAAP, be classified and accounted for as an operating lease for purposes of the
Consolidated balance sheet of ShoLodge and its Subsidiaries.
"Operating Lease Payments" means, with respect to ShoLodge and its
Subsidiaries at any date, the amount, calculated on a Consolidated basis, of the
gross rental and other lease payments (excluding the reimbursement of expenses
paid by the landlord thereunder) due or payable under any Operating Lease. The
amount of such gross rental and other lease payments shall include, without
limitation, the HPT Lease Payments (calculated as defined herein).
"Sale-Leaseback Agreements" means the collective reference to the
following agreements: (i) the Purchase and Sale Agreement dated as of October
24, 1997 by and among ShoLodge and certain of its Subsidiaries, as sellers, and
Hospitality Properties Trust, as purchaser, (ii) the Agreement to Lease dated as
of October 24, 1997 by and between ShoLodge and Hospitality Properties Trust,
(iii) the Lease Agreement dated as of November 19, 1997 by and between HPT Suite
Properties Trust and Suite Tenant, Inc., (iv) the Security Agreement dated as of
November 19, 1997 by and between HPT Suite Properties Trust and Suite Tenant,
Inc., (v) the Assignment and Security Agreement dated as of November 19, 1997 by
and between HPT Suite Properties Trust and the Suite Tenant, Inc.. (vi) the
Stock Pledge dated as of November 19, 1997 made by ShoLodge in favor of HPT
Suite Properties Trust and (vii) the Limited Guaranty Agreement dated as of
November 19, 1997 made by ShoLodge in favor of HPT Suite Properties Trust, each
as amended and in effect on the closing date of the First Amendment.
"Sale-Leaseback Transactions" means the series of transactions set
forth in the Sale- Leaseback Agreements pursuant to which (i) ShoLodge and
certain of its Subsidiaries have. sold certain properties and assigned certain
interests under a ground lease to Hospitality Properties Trust and (ii) Suite
Tenant, Inc., a Wholly-Owned Subsidiary of ShoLodge. has leased such properties
from HPT Suite Properties Trust, a Wholly-Owned Subsidiary of Hospitality
Properties Trust.
"Weighted Operating Lease Payments" means, with respect to ShoLodge and
its Subsidiaries at any date, the product of (a) the aggregate of all HPT Lease
Payments due and payable for the period of four (4) full consecutive fiscal
quarters following such date times (b) eight (8); provided that Weighted
Operating Lease Payments shall not be less than $99,568,000.
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(c) Amendment to Section 2.4(c). The first sentence of
subsection (c) of Section 2.4 of the Credit Agreement is hereby deleted in its
entirety and the following is substituted in lieu thereof:
If pursuant to Section 10.7(c) or (f) an amount equal to the
Net Disposition Proceeds is not reinvested into comparable
replacement assets by any Borrower or any of its Subsidiaries
within twelve (12) months of the applicable Disposition (or
within twelve (12) months of the receipt of payment of any
deferred payments (including, without limitation, any deferred
payments received by ShoLodge under any Sale-Leaseback
Agreement)), then within five (5) days after the passage of
said twelve (12) month period, the Borrowers shall immediately
repay to the Administrative Agent for the account of the
Lenders, Extensions of Credit in an amount equal to such Net
Disposition Proceeds not so reinvested.
(d) Amendment to Section 4.1 (c}. The table set forth in
subsection (c) of Section 4.1 of the Credit Agreement is hereby deleted in its
entirety and the following table is substituted in lieu thereof:
Applicable Margin Per Annum
Tier Senior Leverage Ratio Base Rate + LIBOR Rate +
---- --------------------- ----------- ------------
I less than 1.00 (0.25%) 1.50%
II greater than or equal to
1.00 and less than 1.75 0.00% 1.75%
III greater than or equal to
1.75 but less than 2.50 0.25% 2.00%
IV greater than or equal to
2.50 0.50% 2.25%
(e) Amendment to Section 4.3(a). The table set forth in
subsection (a) of Section 4.3 of the Credit Agreement is hereby deleted in its
entirety and the following table is substituted in lieu thereof:
Tier Senior Leverage Ratio Commitment Fee
---- --------------------- --------------
I less than 1.00 0.15%
II greater than or equal to
1.00 and less than 1.75 0.20%
III greater than or equal to
1.75 but less than 2.50 0.30%
IV greater than or equal to
2.50 0.40%
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(f) Amendment to Section 6.1(p). The Phrase "As of the Closing
Date," shall be added at the beginning of the first sentence of subsection (p)
of Section 6.1 of the Credit Agreement. the word "The" currently at the
beginning of the first sentence of subsection (p) of Section 6.1 of the Credit
Agreement shall be deleted and the word "the" shall be inserted in lieu thereof.
and the phrase "As of the Closing Date," shall be added at the beginning of the
last sentence of subsection (p) of Section 6.1 of the Credit Agreement.
(g) Amendment to Section 9.2. Section 9.2 of the Credit
Agreement is hereby deleted in its entirety and the following is substituted in
lieu thereof:
SECTION 9.2. Debt to Capitalization Ratio. As of the end of
any fiscal quarter, permit the ratio of (a) the sum of (i) the
Consolidated Debt of ShoLodge and its Subsidiaries (excluding Defeased
Debt) as of such fiscal quarter end plus (ii) the Weighted Operating
Lease Payments of ShoLodge and its Subsidiaries as of such fiscal
quarter end less (iii) cash balances (including short term marketable
securities) of ShoLodge and its Subsidiaries as of such date in excess
of $5,000,000 to (b) the sum of (i) the Consolidated Net Worth of
ShoLodge and its Subsidiaries plus (ii) the Consolidated Debt of
ShoLodge and its Subsidiaries (excluding Defeased Debt) plus (iii) the
Weighted Operating Lease Payments of ShoLodge and its Subsidiaries plus
(iv) 66% of the unamortized gain arising from the Sale-Leaseback
Transactions less (v) cash balances (including short term marketable
securities) of ShoLodge and its Subsidiaries as of such date in excess
of $5,000,000, each as of such fiscal quarter end, to exceed 0.69 to
1.00.
(h) Amendment to Section 9.3. Section 9.3 of the Credit
Agreement is hereby deleted in its entirety and the following is substituted in
lieu thereof:
SECTION 9.3 Senior Leverage Ratio. As of any fiscal quarter
ending during the applicable period set forth below, permit the ratio
of (a) the sum of (i) Senior Debt (excluding Defeased Debt) of ShoLodge
and its Subsidiaries as of such date plus (ii) the Weighted Operating
Lease Payments of ShoLodge and its Subsidiaries as of such fiscal
quarter end less (iii) cash balances (including short term marketable
securities) of ShoLodge and its Subsidiaries as of such date in excess
of $5,000,000 to (b) EBITDAR (excluding (i) accretion income associated
with any Defeased Debt and (ii) amortization of gain on the sale of
assets in connection with the Sale-Leaseback Transactions pursuant to
the Sale-Leaseback Agreements) of ShoLodge and its Subsidiaries for the
period of four (4) consecutive fiscal quarters ending on such fiscal
quarter end to exceed the corresponding ratio set forth below:
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Maximum
Senior
Period Leverage Ratio
------ --------------
Closing Date to and
including December 27, 1997 3.75 to 1.00
Beginning as of December 28, 1997 to
and including December 27, 1998 3.25 to 1.00
Beginning as of December 28, 1998
and thereafter 2.75 to 1.00
(i) Amendment to Section 9.4. Section 9.4 of the Credit
Agreement is hereby deleted in its entirety and the following is substituted in
lieu thereof:
SECTION 9.4. Fixed Charge Coverage Ratio. As of the end of any
fiscal quarter, permit the ratio of (a) the sum of (i) Consolidated
EBIT of ShoLodge and its Subsidiaries for the period of four (4)
consecutive fiscal quarters ending on such fiscal quarter end plus (ii)
Consolidated depreciation and amortization (excluding amortization of
gain on the sale of assets in connection with the Sale-Leaseback
Transactions pursuant to the Sale-Leaseback Agreements) of ShoLodge and
its Subsidiaries for such period of four (4) consecutive fiscal
quarters plus (iii) Operating Lease Payments of ShoLodge and its
Subsidiaries for such period of four (4) consecutive fiscal quarters to
(b) the sum of (i) Interest Expense of ShoLodge and its Subsidiaries
for such period of four (4) consecutive fiscal quarters plus (ii)
Capitalized Interest for such period of four (4) consecutive fiscal
quarters plus (iii) Operating Lease Payments of ShoLodge and its
Subsidiaries for such period of four (4) consecutive fiscal quarters
plus (iv) any scheduled principal payments during such period of four
(4) consecutive fiscal quarters with respect to any Debt (regardless of
whether such amounts were actually paid), to be less than 1.25 to 1.00.
(j) Amendment to Sections 10.2(b) and (c) and Addition of new
Section 10.2(c). The phrase "and" at the end of subsection (b) of Section 10.2
of the Credit Agreement is hereby deleted, subsection (c) of Section 10.2 of the
Credit Agreement is amended to become subsection (d) of Section 10.2 of the
Credit Agreement and the following subsection (c} of Section 10.2 of the Credit
Agreement is hereby set forth as an addition to the Credit Agreement:
(c) contingent Obligations of ShoLodge pursuant to the Limited
Guaranty Agreement dated as of November 19, 1997 made by ShoLodge in
favor HPT Suite V Properties Trust with respect to the Sale-Leaseback
Transactions; provided that such Contingent Obligations shall be in an
aggregate amount not to exceed $14,000,000; and
(k) Amendment to Sections 10.3(f) and(g) and Addition of new
Sections 10.3(g) and (h). The phrase "and" at the end of subsection (f) of
Section 10.3 of the Credit Agreement is hereby deleted, subsection (g) of
Section 10.3 of the Credit Agreement is amended to become
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subsection (i) of Section 10.3 of the Credit Agreement and the following
subsections (g) and (h) of Section 10.3 of the Credit Agreement are hereby set
forth as additions to the Credit Agreement:
(g) liens on certain assets of Suite Tenant, Inc.
pursuant to (i) the Security Agreement dated as of November
19, 1997 by and between HPT Suite Properties Trust and Suite
Tenant, Inc. and (ii) the Assignment and Security Agreement
dated as of November 19, 1997 by and between HPT Suite
Properties Trust and Suite Tenant, Inc;
(h) Liens on the capital stock of Suite Tenant, Inc.
owned by ShoLodge pursuant to the Stock Pledge dated as of
November 19, 1997 made by ShoLodge in favor of HPT Suite
Properties Trust: and
(l) Amendment to Section 10.7(c). The following phrase shall
be added to the end of the first proviso to the last sentence of subsection (c)
of Section 10.7 of the Credit Agreement (after the phrase "within twelve ( 12 )
months of such Disposition"):
or within twelve (12) months of the receipt of payment of any deferred
payments
(m) Amendment to Sections 10.7(e) and (f) and Addition of new
Section 10.7(f). The phrase "and" at the end of subsection (e) of Section 10.7
of the Credit Agreement is hereby deleted, subsection (f) of Section 10.7 of the
Credit Agreement is amended to become subsection (g) of Section 10.7 of the
Credit Agreement and the following subsection (f) of Section 10.7 of the Credit
Agreement is hereby set forth as an addition to the Credit Agreement:
(f) the Sale-Leaseback Transactions; provided, that
the Net Disposition Proceeds from the Sale-Leaseback
Transactions shall be reinvested into comparable replacement
assets within twelve (12) months of the Sale-Leaseback
Transaction or within twelve (12) months of the receipt of
payment of any deferred payments; and provided further, that
the failure of ShoLodge or any of its Subsidiaries to reinvest
such Net Disposition Proceeds within such twelve (12) month
period shall result in a mandatory repayment of the Extensions
of Credit in the manner set forth in Section 2.4(c); and
(n) Amendment to Section 10. 12. Section 10. 12 of the Credit
Agreement is hereby deleted in its entirety and the following is substituted in
lieu thereof:
SECTION 10.12. Restrictive Agreements. Enter into any Debt (a)
which contains any negative pledge on assets unless such Debt is
Permitted Debt and a Lien on such assets would be permitted under
Section 10.3, Co) which contains any financial covenants or negative
covenants more restrictive than the restrictions of Articles IX and X
hereof, respectively, or (c) which restricts, limits or otherwise
encumbers its ability to incur Liens on or with respect to any of its
assets or properties other than the assets or properties securing such
Debt (other than with respect to restrictions on (i) liens on the
property leased by HPT Suite Properties Trust to Suite Tenant, Inc.
under the Sale-Leaseback Agreements, (ii) liens on the leasehold
interest of Suite Tenant, Inc. in
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such property and (iii) attachments, levies, claims or encumbrances with respect
to the rent under the Lease, each pursuant to Section 7.1 of the Lease).
(o) Amendment to Section 13.1. The address with respect to
notices to the Borrowers in Section 13.1 of the Credit Agreement is hereby
deleted in its entirety and the following is substituted in lieu thereof:
ShoLodge, Inc.
000 Xxxxx Xxxxx Xxxxx
Xxxxxxxxxxxxxx, Xxxxxxxxx 00000
Attention: Xxxxxxx X. Xxxxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
4.01 Confirmation of No Violation of Section 10.8. The parties hereto
hereby confirm that no violation of Section 10.8 of the Credit Agreement has
resulted from the Sale-Leaseback Transactions.
5.01 Effectiveness. This First Amendment shall become effective upon
the satisfaction of the following conditions:
(a) First Amendment Documents. The Borrowers shall have
delivered to the Administrative Agent a fully executed original hereof.
(b) Sale-Leaseback Agreements. The Borrowers shall have
delivered to the Administrative Agent executed copies of each of the
Sale-Leaseback Agreements, and each other agreement or document reasonably
requested by the Administrative Agent which has been executed in connection
therewith, each of which are true, correct and complete as of the date of this
First Amendment.
(c) Certificates of Secretary. The Administrative Agent shall
have received a certificate of the secretary or assistant secretary of each
Borrower (i) certifying that the articles of incorporation and the bylaws of
such Borrower delivered on the Closing Date of the Credit Agreement have not
been repealed, revoked, rescinded or amended in any respect, (ii) certifying
that the resolutions duly adopted by the Board of Directors of such Borrower
which were delivered on the Closing Date of the Credit Agreement authorize the
execution, delivery and performance of this First Amendment and that such
resolutions have not been repealed, revoked, rescinded or amended in any
respect; and (iii) as to the incumbency and genuineness of the signature of each
officer of such Borrower executing this First Amendment and the other Loan
Documents to which it is a party.
(d) Opinions of Counsel. The Administrative Agent shall have
received (i) a favorable opinion of counsel to the Borrowers addressed to the
Administrative Agent and the Lenders with respect to the Borrowers and the First
Amendment and (ii) each opinion of counsel delivered in connection with the
Sale-Leaseback Agreements.
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(e) Fees and Expenses. The Administrative Agent shall have
been reimbursed for all fees, including, without limitation, an amendment fee
agreed upon by the Administrative Agent and the Borrower, and out of pocket
charges and other expenses incurred in connection with this First Amendment and
the transactions contemplated herein, including, without limitation, the costs
and expenses set forth in Section 6.01(c).
6.01 General Provisions.
(a) Representations and Warranties.
(i) Each Borrower hereby confirms that each representation and
warranty made by it under the Loan Documents is true and correct (other than to
the extent that any such representation and warranty is not true and correct
solely as a result of the Sale-Leaseback Transactions) as of the date hereof (or
such other date specifically set forth with respect to any such representation
and warranty as set forth in the Credit Agreement) and that no Default or Event
of Default has occurred or is continuing under the Credit Agreement.
(ii) Each Borrower hereby represents and warrants that as of
the date hereof there are no claims or offsets against or defenses or
counterclaims to their respective obligations under the Credit Agreement or any
other Loan Document.
(iii) Each Borrower (as applicable) hereby represents and
warrants that the Sale-Leaseback Agreements and all other agreements and
documents executed in connection therewith have been duly executed and delivered
by the duly authorized officers of the each Borrower party thereto, and each
such document constitutes the legal, valid and binding obligation of each
Borrower party thereto, enforceable in accordance with its terms, except as such
enforcement may be limited by bankruptcy, insolvency, reorganization, moratorium
or similar state or federal debtor relief laws from time to time in effect which
affect the enforcement of creditors' rights in general and the availability of
equitable remedies.
(b) Limited Amendment. Except as expressly supplemented and amended
herein, the Credit Agreement and each other Loan Document shall continue to be
and shall remain, in full force and effect. This First Amendment shall not be
deemed (i) to be a waiver of,. or consent to, a modification or amendment of,
any other term or condition of the Credit Agreement or (ii) to prejudice any
other fight or rights which the Administrative Agent or the Lenders may now have
br may have in the future under or in connection with the Credit Agreement or
the Loan Documents or any of the instruments or agreements referred to therein,
as the same may be amended or modified from time to time.
(c) Costs and Expenses. The Borrowers hereby jointly and severally
agree to pay or reimburse the Administrative Agent for all of its reasonable and
customary out-of-pocket costs and expenses incurred in connection with the
preparation, negotiation and execution of this First Amendment, including,
without limitation, the reasonable fees and disbursements of counsel.
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(d) Counterparts. This First Amendment may be executed by one or more
of the parties hereto in any number of separate counterparts and all of said
counterparts taken together shall be deemed to constitute one and the same
instrument.
(e) GOVERNING LAW. THIS FIRST AMENDMENT SHALL BE GOVERNED BY, AND
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NORTH
CAROLINA, WITHOUT REFERENCE TO THE CONFLICTS OR CHOICE OF LAW PRINCIPLES
THEREOF.
(f) Fax Transmission. A facsimile, telecopy or other reproduction of
this First Amendment may be executed by one or more parties hereto, and an
executed copy of this First Amendment may be delivered by one or more parties
hereto by facsimile or similar instantaneous electronic transmission device
pursuant to which the signature of or on behalf of such party can be seen, and
such execution and delivery shall be considered valid, binding and effective for
all purposes. At the request of any party hereto, all parties hereto agree to
execute an original of this First Amendment as well as any facsimile, telecopy
or other reproduction hereof.
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IN WITNESS WHEREOF the undersigned hereby cause this First Amendment to
be executed and delivered as of the date first above written.
AGENTS AND LENDERS:
FIRST UNION NATIONAL BANK (f/k/a
FIRST UNION NATIONAL BANK OF
TENNESSEE), as Administrative Agent,
as Swingline Lender and as Lender
By: /S/ XXXXXXX X. XXXXX
----------------------------------------
Name: Xxxxxx X. Xxxxx
Title:Vice President
[SIGNATURES CONTINUED ON FOLLOWING PAGE]
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NATIONSBANK OF TENNESSEE, N.A., as Co-
Agent and as Lender
By: /S/ B. E. XXXXXXX
----------------------------------------
Name: B. E. Xxxxxxx
Title:Vice President
[SIGNATURES CONTINUED ON FOLLOWING PAGE]
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SUNTRUST BANK, NASHVILLE, N.A., as Lender
By: /s/ XXXXXXX X. XXXXXXXX
----------------------------------------
Name: Xxxxxxx X. Xxxxxxxx
Title: AVP
[SIGNATURES CONTINUED ON FOLLOWING PAGE]
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FIRST AMERICAN NATIONAL BANK, as Lender
By:/S/ XXXXXX X. XXXXX
----------------------------------------
Name:Xxxxxx X. Xxxxx
Title:SVP
[SIGNATURES CONTINUED ON FOLLOWING PAGE]
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FIRST TENNESSEE BANK, NATIONAL
ASSOCIATION, as Lender
By: /S/ XXXXXXX X. XXXX
----------------------------------------
Name: XXXXXXX X XXXX
Title: SR VICE PRESIDENT
[SIGNATURES CONTINUED ON FOLLOWING PAGE]
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BORROWERS:
SHOLODGE, INC.
[CORPORATE SEAL]
By:/S/ XXXX XXXXX
----------------------------------------
Name: Xxxx Xxxxx
Title: President
ALABAMA LODGING CORPORATION
[CORPORATE SEAL] By: /S/ XXXX XXXXX
----------------------------------------
Name: Xxxx Xxxxx
Title: President
CAROLINA INNS, INC.
[CORPORATE SEAL]
By: /S/ XXXX XXXXX
----------------------------------------
Name: Xxxx Xxxxx
Title: President
DELAWARE INNS, INC.
[CORPORATE SEAL]
By: /S/ XXXX XXXXX
----------------------------------------
Name: Xxxx Xxxxx
Title: President
[SIGNATURES CONTINUED ON FOLLOWING PAGE]
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FAR WEST INNS, INC.
[CORPORATE SEAL]
By: /S/ XXXX XXXXX
----------------------------------------
Name: Xxxx Xxxxx
Title: President
LAFLA INN, INC.
[CORPORATE SEAL]
By: /S/ XXXX XXXXX
----------------------------------------
Name: Xxxx Xxxxx
Title: President
MIDWEST INNS, INC.
[CORPORATE SEAL]
By: /S/ XXXX XXXXX
----------------------------------------
Name: Xxxx Xxxxx
Title: President
MOBAT INNS, INC.
[CORPORATE SEAL]
By: /S/ XXXXXXX X. XXXXXXX
----------------------------------------
Name: xxxxxxx X. Xxxxxxx
Title: President
XXXXX AND ASSOCIATES, INC.
[CORPORATE SEAL]
By: /S/ XXXX XXXXX
----------------------------------------
Name: Xxxx Xxxxx
Title: President
[SIGNATURES CONTINUED ON FOLLOWING PAGE]
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NASHVILLE AIR ASSOCIATES, INC.
[CORPORATE SEAL]
By: /S/ XXXX XXXXX
----------------------------------------
Name: Xxxx Xxxxx
Title: President
SHONEY'S INN, INC.
[CORPORATE SEAL]
By: /S/ XXXX XXXXX
----------------------------------------
Name: Xxxx Xxxxx
Title: President
SHONEY'S INN NORTH, L.P.
By: SHOLODGE, INC., its General Partner
[CORPORATE SEAL]
By: /S/ XXXX XXXXX
----------------------------------------
Name: Xxxx Xxxxx
Title: President
SHONEY'S INN OF BATON ROUGE
By: TWO SEVENTEEN, INC., one of its General
Partners
[CORPORATE SEAL]
By: /S/ XXXX XXXXX
----------------------------------------
Name: Xxxx Xxxxx
Title: President
[SIGNATURES CONTINUED ON FOLLOWING PAGE]
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By: INN PARTNERS, INC., one of its General
Partners
[CORPORATE SEAL]
By: /S/ XXXX XXXXX
----------------------------------------
Name: Xxxx Xxxxx
Title: President
SHONEY'S INN OF LEBANON, INC.
[CORPORATE SEAL]
By: /S/ XXXX XXXXX
----------------------------------------
Name: Xxxx Xxxxx
Title: President
SOUTHEAST TEXAS INNS, INC.
[CORPORATE SEAL]
By: /S/ XXXX XXXXX
----------------------------------------
Name: Xxxx Xxxxx
Title: President
SUNSHINE INNS, INC.
[CORPORATE SEAL]
By: /S/ XXXX XXXXX
----------------------------------------
Name: Xxxx Xxxxx
Title: President
[SIGNATURES CONTINUED ON FOLLOWING PAGE]
20
VIRGINIA INNS, INC.
[CORPORATE SEAL]
By: /S/ XXXX XXXXX
----------------------------------------
Name: Xxxx Xxxxx
Title: President
THE HOTEL GROUP, INC.
[CORPORATE SEAL]
By: /S/ XXXX XXXXX
----------------------------------------
Name: Xxxx Xxxxx
Title: President
[SIGNATURES CONTINUED ON FOLLOWING PAGE]
21
SCHEDULE 6.1(a)
BORROWER AND
SUBSIDIARY JURISDICTIONS
(as of January 16, 1998)
1. Corporations*
FOREIGN
NAME OF CORPORATION QUALIFICATION(S)
------------------- ----------------
ShoLodge, Inc. Alabama
Arizona
Colorado(1)
Delaware
Florida
Georgia
Indiana
Iowa
Kansas
Louisiana
Michigan
Mississippi
Missouri
New Mexico
North Carolina
Ohio
Texas
Virginia
Two Seventeen, Inc. Louisiana(2)
Missouri
MOBAT, Inc. Alabama
Xxxxxxx
Xxxxxx'x Inns Group, IV, Inc. Mississippi
MURJAC, Inc. Mississippi
Shoney's Inn of Lebanon, Inc. None
---------
* All corporations are Tennessee corporations except ShoLodge Beverage
Corporation which is a Texas corporation and except The Hotel Group, Inc. which
is a Kansas corporation.
22
Shoney's Inn, Inc. None
Nashville Air Associates, Inc. None
Security Financial Corporation None
Xxxxx and Associates, Inc. Alabama
Arizona(3)
Colorado(4)
Florida(3)
Georgia
Kansas
Louisiana(3)
New Mexico
North Carolina(5)
Ohio
Texas(6)
Virginia(3)
Virginia Inns, Inc. Virginia
Airport Inn, Inc. None
ShoLodge Franchise None
Systems, Inc.
Sunshine Inns, Inc. Florida
Inn Partners, Inc. Louisiana
Missouri
LAFLA Inn, Inc. Louisiana
Southeast Texas Inns, Inc. Texas
ShoLodge Beverage Corporation None
Delaware Inns, Inc. Delaware
Alabama Lodging Corporation Alabama
Carolina Inns, Inc. North Carolina
Midwest Inns, Inc. Indiana(7)
Iowa
Michian
Ohio(7)
23
The Hotel Group, Inc. Arizona
Colorado
Far West inns, Inc. New Mexico
Suite Tenant, Inc. Arizona
Florida
Georgia
Indiana
New Mexico
Ohio
Texas
2. Partnerships*
FOREIGN
NAME OF CORPORATION QUALIFICATION(S)
------------------- ----------------
Demonbreum Hotel Associates, Ltd. None
Shoney's Inns of New Orleans, Ltd. Louisiana
Shoney's Inn of Gulfport, Ltd. Mississippi
Shoney's Inn of Independence Missouri(8)
Shoney's Inn of Baton Rouge Louisiana
Shoney's Inn of Bossier City, Ltd. Louisiana
Shoney's Inn of Atlanta, N.E. Georgia(9)
Atlanta Shoney's Inns Joint Venture None
Shoney's Inn of Xxxxxxxxxxx Xxxxxxx(00)
Shoney's Inn North, L.P. None
Shoney's Inn of Music Valley, Ltd. None
24
----------------------
(1) as ShoLodge of Tennessee, Inc.
(2) as Two Seventeen, Inc. of Tennessee
(3) as Xxxxx and Associates of Tennessee
(4) d/b/a Xxxxx and Associates of Tennessee, Inc.
(5) d/b/a Xxxxx and Associates, Inc. of Tennessee
(6) d/b/a Xxxxx Contractors, Inc.
(7) as Midwest Inns of Tennessee, Inc.
(8) Registration of Fictitious Name filed with Missouri Secretary of State
(9) Statement of Partnership filed in Book 5486, page 000, Xxxxx Xxxxxxxx
Xxxxx Xxxxxxx Xxxxxx, Xxxxxxx.
(10) State of Partnership filed in Book 3, page 159 Clerk Superior Court
Xxxxx County, Georgia.
25
SCHEDULE 6.1(b)
SHOLODGE, INC.
SUBSIDIARIES
(as of January 16, 1998)
I. Corporations*
PERCENTAGE OF SHARES
NUMBER OF SHARES NUMBER OF OWNED BY
NAME OF CORPORATION AUTHORIZED** SHARES ISSUED*** SHOLODGE, INC.
------------------- ---------- ------------- --------------
ShoLodge, Inc. 20,000,000 No Par 8,255,810 N/A
Two Seventeen, Inc. 2,000 No Par 100 100%
MOBAT, Inc. 100,000 Par $1.00 1,000 100%
Shoney's Inns Group IV, 100,000 Par $1.00 1,000 100%
Inc.
MURJAC, Inc. 100,000 Par $1.00 1,000 100%(1)
Shoney's Inn of Lebanon, 100,000 Par $1.00 1,000 100%
Inc.
Shoney's Inn, Inc. 2,000 No Par 300 100%
Nashville Air Associates, 100,000 Par $1.00 500 100%
Inc.
Security Financial 1,000 No Par 1,000 100%
Corporation
Xxxxx and Associates, 2,000 No Par 100 100%
Inc.
Virginia Inns, Inc. 1,000 No Par 1,000 100%
Airport Inn, Inc. 1,000 No Par 1,000 100%
--------
**All authorized stock is common stock except(i) ShoLodge, Inc. also
has 1,000,000 shares of preferred stock (including 100,000 shares of Series A
Subordinated Preferred Stock), no par value, and 1,000 shares of Series A
Redeemable Nonparticipating Stock, no par value, authorized, and (ii) ShoLodge
Franchise Systems, Inc. also has 1,000 shares of Series A Redeemable
Nonparticipating Stock, no par value, authorized.
***All issued stock is common stock.
- 1 -
26
ShoLodge Franchise 100,000 Par $1.00 100 100%
Systems, inc.
Sunshine Inns, Inc. 1,000 No Par 1,000 100%
Inn Partners, Inc. 1,000 No Par 1,000 100%
LAFLA Inn, Inc. 1,000 No Par 1,000 100%
Southeast Texas Inns, Inc. 1,000 No Par 1,000 100%
ShoLodge Beverage 10000 Par $.01 1,000 100% (2)
Corporation
Delaware Inns, Inc. 1,000 No Par 1,000 100%
Alabama Lodging 1,000 No Par 1,000 100%
Corporation
Carolina Inns, Inc. 1,000 No Par 1,000 100%
Midwest Inns, Inc. 1,000 No Par 1,000 100%
The Hotel Group, Inc. 1,000 No Par 1,000 100% (3)
Far West Inns, Inc. 1,000 No Par 1,000 100%
Suite Tenant, Inc. 1,000 No Par 1,000 100%
II. Partnerships****
TYPE OF INTEREST OF
NAME OF PARTNERSHIP PARTNERSHIP SHOLODGE, INC. OTHER PARTNER
------------------- ----------- -------------- -------------
Demonbreum Hotel Limited 90% (4) The Xxxxx X. Xxxx, III
Associates, Inc. Family Trust
Shoney's Inns of New Limited 75% (5) Xxxxx X. Xxxxxxx, Xx. as
Orleans, Ltd. Trustee for Omega
Investments
Shoney's Inn of Limited 75% Xxxxx X. Xxxxxxx, Xx. as
Gulfport, Ltd. Trustee for Omega
Investments
--------
****All partnerships are Tennessee partnership.
- 2 -
27
Shoney's Inn of General 100% (6) N/A
Independence
Shoney's Inn of Baton General 100% (6) N/A
Rouge
Shoney's Inn of Bossier Limited 75% Xxxxx X. Xxxxxxx, Xx. as
City, Ltd. Trustee for Omega
Investments
Shoney's Inn of Atlanta General 75% (7) Xxxxx X. Xxxxxxx, Xx. as
N.E. Trustee for Omega
Investments
Atlanta Shoney's Inns General 73.33% (7) Dawg Enterprises, Inc.
Joint Venture
Shoney's Inn of General 55% (8) Dawg Enterprises, Inc..
Stockbridge (20%)(8) Xxxxx X.
Xxxxxxx, Xx. as Trustee for
Omega Investments (25%)
Shoney's Inn North, Limited 100% (9) N/A
L.P.
Shoney's Inn of Music Limited 60% Xxxxx Xxxx Heirs
Valley, Ltd. Associates
----------------------
(1) Through Shoney's Inns Group IV, Inc.
(2) Through Southeast Texas Inns, Inc.
(3) Through Midwest Inns, Inc.
(4) 20% through Inn Partners, Inc.
(5) Through Two Seventeen, Inc.
(6) 60% through Two Seventeen, Inc. and 0% through Inn Partners, Inc.
(7) Through MOBAT, Inc.
(8) Through Atlanta Shoney's Inns Joint Venture
(9) 50% through Shoney's Inn of Lebanon, Inc.
Other than as set forth in the corporate charter or partnership agreement, as
applicable, and other than stock options granted by ShoLodge, Inc. pursuant to
its 1991 Stock Option Plan, as amended, there are no outstanding stock purchase
warrants, subscriptions, options, securities, instruments, rights of first
refusal or other rights of any type or nature whatsoever issued by ShoLodge,
Inc. or its subsidiaries, which are convertible into exchangeable for or
otherwise
- 3 -
28
provide for or permit the issuance of capital stock or other ownership interests
by ShoLodge, inc. or its subsidiaries.
- 4 -
29
SCHEDULE 8.12
ShoLodge Franchise Systems, Inc.
ShoLodge Beverage Corporation
Suite Tenant, Inc.
