EXHIBIT 10.1
AMENDMENT AND EXTENSION OF
FORBEARANCE AGREEMENT
THIS AMENDMENT AND EXTENSION OF FORBEARANCE AGREEMENT ("Agreement") is
made as of March 29, 2002, among NATIONAL GOLF OPERATING PARTNERSHIP, L.P., a
Delaware limited partnership (the "Borrower"), continued pursuant to that
certain Third Amended and Restated Agreement of Limited Partnership, dated as of
July 28, 1999, as amended (the "Operating Agreement"), NATIONAL GOLF PROPERTIES,
INC., a Maryland corporation (the "Guarantor"), BANK ONE, NA, a national banking
association with its main office in Chicago Illinois, individually and as agent
("Agent") for Lenders (as defined in the Credit Agreement referenced below) and
the Lenders.
Recitals:
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A. Pursuant to the terms of the Amended and Restated Credit Agreement
dated as of July 30, 1999, among Borrower, Guarantor, Agent, and the Lenders
from time to time that are parties thereto (as amended from time to time, the
"Credit Agreement"), 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"). Terms appearing
as initially capitalized terms and not otherwise expressly defined in this
Agreement shall have the respective meanings given them in the Credit Agreement.
B. Pursuant to the terms of a Forbearance Agreement dated as of February
8, 2002 among the Borrower, Guarantor, Agent and Lenders (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 Forbearance Agreement).
C. Borrower and Guarantor have requested that Lenders extend the
effectiveness of the Forbearance Agreement and agree to amend certain other
provisions of the Credit Agreement. Lenders have agreed to amend such provisions
of the Credit Agreement and extend the effectiveness of the Forbearance
Agreement for a limited period of time on the conditions set forth in this
Agreement.
Agreement
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NOW, THEREFORE, in consideration of the foregoing premises, the mutual
agreements of the parties contained herein, and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
Borrower, Guarantor, Agent and Lenders hereby agree as follows:
1. EXTENSION. The Required Lenders agree that the stated expiration date of the
"Forbearance Period" (as defined in Section 2 of the Forbearance Agreement)
shall be extended from March 29, 2002 to April 30, 2002 and that all other
provisions of the Forbearance Agreement shall continue in effect, unless
otherwise expressly provided herein, subject to satisfaction of all of the
"Extension Conditions" (as defined below) on or before March 29, 2002.
The Revolving Lenders and the Required Term Lenders agree that the
Revolving Facility Termination Date shall be extended from March 29, 2002 to
April 30, 2002, subject to satisfaction of all of the Extension Conditions on or
before March 29, 2002. The "Extension Conditions" shall be as follows:
(a) Borrower, Guarantor, Agent, all of the Revolving Lenders and the
Required Term Lenders have executed this Agreement and delivered counterparts to
Agent,
(b) Borrower has paid a fee to Agent for the benefit of the Lenders equal
to 0.375% of the aggregate outstanding principal balance of the Revolving
Facility and Term Facility (after giving effect to the payment required in
clause (c) below), which shall be allocated among the Lenders executing
this Agreement on a pro rata basis on their relative principal amounts
outstanding;
(c) Borrower has remitted to the Agent (i) $1,000,000, representing the
principal amortization payment due on March 29, 2002 pursuant to Section 2.8(c)
of the Credit Agreement, and (ii) $5,300,000, representing the Net Cash Proceeds
from the sale of Red Mount Ranch and Sabal Palm. Pursuant to Section 2.23 of
the Credit Agreement, such amounts shall be applied to reduce the outstanding
principal balance of the Revolving Facility and the Term Facility on a pro rata
basis, based on the relative principal amounts outstanding under the Term
Facility and the Revolving Facility. The Aggregate Revolving Commitment shall
be permanently reduced by all payments of principal which have been and are
hereafter applied to the Revolving Facility from and after the "Effective Date"
of the Forbearance Agreement and each Revolving Lender's Revolving Commitment
shall be reduced proportionately; and
(d) Borrower shall have provided to Agent evidence reasonably satisfactory
to Agent, including a certified resolution and an incumbency certificate from
Guarantor, substantially in the form attached as Exhibit 2(d) to the 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.
2. SPECIFIED DEFAULTS. The definition of "Specified Defaults" in the Forbearance
Agreement are hereby amended (a) by adding the words "and March 31, 2002" at the
end of clause (i) of the first sentence of Section 1 of the Forbearance
Agreement, (b) by adding the words "or as a result of any failure of AGC to
provide or pay for certain bonds due to Borrower thereunder or to perform any
other non-payment and non-material obligation thereunder" at the end of clause
(iii) of the first sentence of Section 1 of the Forbearance Agreement, and (c)
by adding the following sentence at the end of such Section 1: "Nonpayment of
AGC's credit facility with Bank of America at its maturity on March 29, 2002
shall constitute a Specified Default but only so long as Bank of America does
not commence enforcement of its rights to collect such debt from AGC. Any action
by Bank of America to enforce its rights with respect to such debt shall be
deemed to be an "acceleration" of such debt and the provisions of the
proceedings sentence shall apply.
3. INDUCEMENTS TO LENDERS TO EXTEND. For the benefit and reliance of
Lenders, and to induce Lenders to enter into this Agreement, Borrower and
Guarantor individually and each on its own behalf hereby represents and
warrants as follows:
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(a) Other than as contemplated by the terms hereof, the Credit Agreement,
Notes, and all of the other Loan Documents executed by Borrower and/or
Guarantor are in full force and effect on the date of this Agreement and
are enforceable against Borrower and/or Guarantor in accordance with their
terms;
(b) As of the date of this Agreement (prior to the payments required as part
of the Extension Conditions), the unpaid balance of principal due and
payable under the Revolving Facility is $180,312,080.54 and under the Term
Facility is $88,352,919.46 (which amounts do not include attorneys' fees
and other costs of Lenders incurred and unpaid as of the date hereof, or
any accrued and unpaid interest or fees, all of which shall be in addition
to such amount).
(c) To each's knowledge, Borrower and Guarantor have no right of set-off,
defense, claim, or cause of action against Agent, Lenders or any of
their affiliates, or any of their respective officers, directors,
employees, agents, or attorneys, in connection with the Loan 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 discharges
Agent and Lenders and their respective directors, officers, employees,
agents, affiliates, successors and assigns ("Released Parties") of and
from any and all claims, actions, causes of action, demands, 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
Revolving Facility, the Term Facility, the Credit Agreement or this
Agreement or the other Loan Documents as of the date of execution of
this Agreement, 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 hereinabove;
(d) Borrower and Guarantor have taken all necessary action to authorize the
execution, delivery and performance of this Agreement, and this Agreement
has been duly executed and delivered by or on behalf of Borrower and
Guarantor and constitutes the legal, valid and binding obligation of
Borrower and Guarantor enforceable against Borrower and Guarantor in
accordance with its terms;
(e) The execution, delivery and performance of this Agreement by Borrower
and Guarantor will not conflict with or result in a breach of any of
the terms or provisions of, constitute a default under, require any
consent under, or result in the creation or imposition of any lien,
charge or encumbrance upon any of the property or assets of Borrower or
Guarantor pursuant to the terms of, any indenture, mortgage, deed of
trust, loan agreement, or other agreement or instrument to which
Borrower or Guarantor is a party or by which Borrower's or Guarantor's
property or assets is subject, nor will such action result in any
violation of the provisions of any statute or any order, rule or
regulation of any court or governmental agency or body having
jurisdiction over Borrower or any of its properties or assets, and any
consent, approval, authorization, order, registration or qualification
of or with any court or any such regulatory authority or other
governmental agency or body required for the execution, delivery and
performance by Borrower of this Agreement or any other Loan Documents
has been obtained and is in full force and effect;
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(f) To each's actual knowledge, except for the Specified Defaults, no material
Default has occurred that remains uncured as of the date hereof; and
(g) Other than the Liens on one Property described on Exhibit 3(g) to the
Forbearance Agreement which was incorrectly identified as an
Unencumbered Asset on the most recent compliance certificate furnished
to Lenders, Borrower has not granted or suffered to exist any material
Liens (other than Permitted Liens identified in Subsections 7.15 (i) to
(iv)) on any of the Projects included in Unencumbered Assets as
referenced in the most recent compliance certificate furnished to
Lenders, and all such Projects comply with each of the requirements set
forth in the definition of "Unencumbered Asset."
4. REPORTING REQUIREMENTS. In addition to continuing the reporting requirements
established by Section 4 of the Forbearance Agreement, Borrower shall provide
weekly updates on the progress being made with all potential equity and debt
sources.
5. NET CASH PROCEEDS. Net Cash Proceeds received from the sale of assets during
the extension of the Forbearance Period shall continue to be paid to the Lenders
in accordance with Section 5 of the Forbearance Agreement, except that the
Borrower may establish a reserve for payment to the holders under the Note
Purchase Agreements of their pro rata share of such Net Cash Proceeds, based on
the respective principal balances outstanding under this Facility and under the
Note Purchase Agreement. Any such reserve shall be disbursed (i) to such holders
only upon Borrower reaching agreement with such holders and the Lenders
regarding the granting of collateral to the Lenders and such holders, consent to
the establishment of a holding company for the Borrower and AGC and related
transactions and the waiver or satisfactory reduction of pre-payment penalties,
or (ii) to the Lenders if such agreement is not reached by the end of the
Forbearance Period. Notwithstanding the foregoing, (i) the Borrower shall have
no further right to reserve in the Capital Expenditure / 1031 Reserve the Net
Cash Proceeds from any Projects other than Anticipated 1031 Projects and (ii)
any Net Cash Proceeds that were previously reserved for the purpose of
completing Section 1031 Transactions shall be paid to the Lenders in full (or in
part if a reserve for the holders under the Note Purchase Agreements has been
established as provided above) if such Net Cash Proceeds have not been invested
in another Project within the time period required by the Code to successfully
complete a Section 1031 Transaction.
6. CAPITAL EXPENDITURES. During the extension of the Forbearance Period the
Borrower agrees to withhold payment of any amounts due to AGC under the Approved
Operating Leases on account of capital expenditures at the Projects until AGC
has paid in full all delinquent rent under all of the Approved Operating Leases
and the net aggregate termination fees due to Borrower with respect to the early
termination of any Approved Operating Leases. A schedule of all anticipated
capital expenditures for 2002 on a course-by-course basis will be provided to
the Lenders prior to March 29, 2002. Such schedule shall also indicate in which
quarter such expenditures are expected to be incurred and whether such
expenditures are obligations of AGC or of the Borrower.
7. COLLATERAL. As consideration for the extension of the Forbearance Period and
of the Revolving Facility Termination Date, the Borrower agrees to provide
collateral to the Lenders for the Facility when the Lenders are prepared to
agree to an extension of the Revolving Facility Termination Date to March 31,
2003, on such other terms as may be mutually agreeable. The collateral shall
constitute all Projects which were shown as Unencumbered Assets on the most
recent compliance certificate provided to the Lenders, excluding only those
Projects with respect to
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which the Agent determines, in the exercise of its reasonable judgment, that
mortgage taxes and other perfection expenses will be disproportionate to the
benefit to the Lenders of the incremental collateral value. Such Projects shall
be encumbered, at the Borrower's expense, by first priority perfected, mortgages
or deeds of trust in favor of a collateral agent which shall hold such
collateral for the benefit of the Lenders and the holders under the Note
Purchase Agreement on a pro rata basis based on their respective principal
balances.
8. INTEREST DURING EXTENSION OF FORBEARANCE PERIOD. From March 30, 2002 until
the expiration or earlier termination of the Forbearance Period, (i) all
Advances shall be ABR Advances and no ABR Advance may be made as or converted
into a LIBOR Advance, (ii) each ABR Advance shall bear interest at a rate per
annum equal to the Adjusted ABR Rate otherwise applicable to such ABR Advance
plus 1.50% per annum. Nothing herein shall limit the right of Lenders to receive
the Default Rate once the Forbearance Period expires or is terminated.
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, 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.
10. NO COURSE OF CONDUCT. Borrower acknowledges that the determination by
Lenders 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
Lender to enter into any further forbearance or any modification of the Loan
Documents.
11. SEVERABILITY. In case any provision of this Agreement shall be invalid,
illegal, or unenforceable, the validity, legality, and enforceability of the
remaining provisions shall not in any way be affected or impaired thereby.
12. NO MODIFICATION EXCEPT IN WRITING. None of the terms of this Agreement may
be modified, waived, altered, amended, supplemented, extended, consolidated,
replaced, exchanged or otherwise changed except by an instrument in writing duly
executed by all of the parties hereto.
13. FURTHER ASSURANCES. Borrower, Guarantor, Agent and the Lenders 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.
14. GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of the State of Illinois.
15. RESERVATION AND REMEDIES. Except as specifically stated in this Agreement or
in the Forbearance Agreement, this Agreement shall not be deemed or construed to
(i) constitute a waiver of any right or remedy available to any of Borrower,
Guarantor, Agent or Lenders under the Loan Documents, at law, in equity or
otherwise, and each of the foregoing hereby expressly reserves all of such
rights and remedies; or (ii) give any of Borrower, Guarantor, Agent or Lenders
any rights under the Credit Agreement that each would otherwise not have due to
the existence of a Default (even if such Default is one of the Specified
Defaults), unless expressly provided for in this Agreement or in the Forbearance
Agreement.
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16. SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon, and shall
inure to the benefit of, the parties hereto and their respective successors and
assigns.
17. INTERPRETATION. As used herein, the terms (a) "person" shall mean an
individual, a corporation, a partnership, a trust, an unincorporated
organization or other entity or any agency or political subdivision thereof; and
(b) "including" or "include" shall mean "including without limitation" or
"include, among other things", or "include, without limiting the generality of
the foregoing". The Recitals to this Agreement are incorporated herein and
expressly made a part hereof. The terms and provisions of this Agreement shall
be interpreted and construed in accordance with their usual and customary
meanings, and the parties hereby expressly waive and disclaim in connection with
the interpretation and construction of this Agreement, any rule of law or
procedure requiring otherwise, including, any rule of law to the effect that
ambiguous or conflicting terms or provisions contained in this Agreement shall
be interpreted or construed against the party whose attorney prepared this
Agreement or any earlier draft of this Agreement.
18. COUNTERPARTS. This Agreement may be executed in two or more counterparts
(including by facsimile transmission of signature pages hereto), each of which
may be executed by one or more of the parties hereto, but all of which, when
taken together, shall constitute but one agreement.
19. WAIVER OF JURY TRIAL. AGENT, LENDERS, BORROWER AND GUARANTOR, BY THEIR
ACCEPTANCE HEREOF, EACH HEREBY WAIVE ANY RIGHT TO A TRIAL BY JURY IN ANY ACTION
OR PROCEEDING TO ENFORCE OR DEFEND ANY RIGHT UNDER THIS AGREEMENT OR ANY OTHER
LOAN DOCUMENTS RELATING THERETO OR ARISING FROM THE LENDING RELATIONSHIP WHICH
IS THE SUBJECT OF THIS AGREEMENT AND AGREE THAT ANY SUCH ACTION OR PROCEEDING
SHALL BE TRIED BEFORE A COURT AND NOT BEFORE A JURY.
20. INTEGRATION. This Agreement, together with the Forbearance Agreement and the
Loan Documents, constitute the entire agreement among Agent, Lenders, Borrower,
and Guarantor with respect to the Term Facility and the Revolving Facility and
the subject matter of the foregoing documents, and all prior writings and
discussions and all contemporaneous discussions are hereby merged into and
superseded by the provisions of the foregoing documents.
21. AGREEMENT CONTROLLING. In the event of a conflict or inconsistency between
the provisions of the Loan Documents and the provisions of this Agreement, the
provisions of this Agreement shall govern. This Agreement shall constitute a
Loan Document for all purposes. Any reference to the Credit Agreement in any of
the Loan Documents shall hereafter mean the Credit Agreement as supplemented by
the Forbearance Agreement and this Agreement as the same may be subsequently
amended, modified, altered, supplemented, extended, consolidated, replaced,
exchanged or otherwise changed.
[SIGNATURES ARE CONTAINED ON THE FOLLOWING PAGE]
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IN WITNESS WHEREOF, Borrower, Guarantor, Agent and Lenders have caused
this Agreement to be executed as of the date first above written.
BORROWER: NATIONAL GOLF OPERATING PARTNERSHIP, L.P.
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By: National Golf Properties, Inc., its
general partner
By:/s/ Xxxx X. Xxxxxx
-----------------------------------
Print Name: Xxxx X. Xxxxxx
Title: Chief Financial Officer and Secretary
GUARANTOR: NATIONAL GOLF PROPERTIES, INC.
---------
By:/s/ Xxxx X. Xxxxxx
-----------------------------------
Print Name: Xxxx X. Xxxxxx
Title: Chief Financial Officer and Secretary
AGENT: BANK ONE, NA, Individually and as
------ Administrative Agent
By:/s/ Xxxxxxx Xxxxxx
-----------------------------------
Print Name: Xxxxxxx Xxxxxx
Title: Vice President
LENDERS: XXXXXXX XXXXX CAPITAL CORPORATION,
------- Individually and as Syndication Agent
By:/s/ Xxxxxxx X. X'Xxxxx
-----------------------------------
Print Name: Xxxxxxx X. X'Xxxxx
Title: Vice President
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ING CAPITAL LLC, as successor to
ING (U.S.) CAPITAL LLC, Individually and as
Co-Documentation Agent and Co-Arranger
By:/s/ Xxxxx X. Xxxxxxxx
-------------------------------------
Print Name: Xxxxx X. Xxxxxxxx
Title: Vice President
UNION BANK OF CALIFORNIA, N.A.,
Individually and as Co-Documentation Agent
By:/s/ Xxxxx Xxxxxx Bleifer
-------------------------------------
Print Name: Xxxxx Xxxxxx Xxxxxxx
Title: Vice President
FLEET NATIONAL BANK, Individually and as
Co-Agent
By:/s/ Xxxxxxx X. Xxxxx
-------------------------------------
Print Name: Xxxxxxx X. Xxxxx
Title: Vice President
CITY NATIONAL BANK, Individually and as
Co-Agent
By:/s/ Xxxxx Xxxxx
-------------------------------------
Print Name: Xxxxx Xxxxx
Title: Senior Vice President
XXXXX FARGO BANK, NATIONAL
ASSOCIATION, Individually and as Co-Agent
By:/s/ Art Brokx
-------------------------------------
Print Name: Art Brokx
Title: Vice President
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PACIFIC LIFE INSURANCE COMPANY
By:/s/ T. Xxxxxxx Xxxxxx
-------------------------------------
Print Name: T. Xxxxxxx Xxxxxx
Title: Vice President
By:/s/ X.X. Xxxxxxx
-------------------------------------
Print Name: X.X. Xxxxxxx
Title: Assistant Secretary
AMSOUTH BANK
By:/s/ Xxxxxxxx Xxxxx
-------------------------------------
Print Name: Xxxxxxxx Xxxxx
Title: Vice President
CALIFORNIA FEDERAL BANK
By:/s/ Xxxxxxx X. Xxxxx
-------------------------------------
Print Name: Xxxxxxx Xxxxx
Title: Vice President
FIRST AMERICAN BANK TEXAS, SSB
By:/s/ Xxxx Xxxxxx
-------------------------------------
Print Name: Xxxx Xxxxxx
Title: Assistant Vice President
CREDIT LYONNAIS NEW YORK BRANCH
By:/s/ Bruno DeFloor
-------------------------------------
Print Name: Bruno DeFloor
Title: Vice President
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XXXXXXXX XXXX, XX, XXX XXXX AND
GRAND CAYMAN BRANCHES
By:/s/ Xxxxxxxx Xxxxx
-------------------------------------
Print Name: Xxxxxxxx Xxxxx
Title: Director
By:/s/ Xxxxxxx X. Xxxxxxxxx
-------------------------------------
Print Name: Xxxxxxx X. Xxxxxxxxx
Title: Director
ING PRIME RATE TRUST
By: ING Investments LLC
By:/s/ Xxxxx Xxxxx
-------------------------------------
Print Name: Xxxxx Xxxxx
Title: Vice President
THE TRAVELERS INSURANCE COMPANY
By:/s/ Xxxxxx X. Xxxxxxxxxxxx
-------------------------------------
Print Name: Xxxxxx X. Xxxxxxxxxxxx
Title: Investment Officer
MASSACHUSETTS MUTUAL LIFE INSURANCE
COMPANY
By:/s/ Xxxx X. Law
-------------------------------------
Print Name: Xxxx X. Law
Title: Managing Director
OCTAGON INVESTMENT PARTNERS II, LLC
By: Octagon Credit Investors, LLC as
sub-investment manager
By:/s/ Xxxxxx X. Xxxxxx
-------------------------------------
Print Name: Xxxxxx X. Xxxxxx
Title: Portfolio Manager
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OCTAGON INVESTMENT PARTNERS III, LLC
By: Octagon Credit Investors, LLC as
portfolio manager
By:/s/ Xxxxxx X. Xxxxxx
-------------------------------------
Print Name: Xxxxxx X. Xxxxxx
Title: Portfolio Manager
OCTAGON INVESTMENT PARTNERS IV, LTD.
By: Octagon Credit Investors, LLC as
collateral manager
By:/s/ Xxxxxx X. Xxxxxx
-------------------------------------
Print Name: Xxxxxx X. Xxxxxx
Title: Portfolio Manager
KZH Soleil LLC
By:/s/ Xxxxx Xxxxxx Xxxxxx
-------------------------------------
Print Name: Xxxxx Xxxxxx Xxxxxx
Title: Authorized Agent
KZH Soleil-2 LLC
By:/s/ Xxxxx Xxxxxx Xxxxxx
-------------------------------------
Print Name: Xxxxx Xxxxxx Xxxxxx
Title: Authorized Agent
FIRSTRUST BANK
By:/s/ Xxxx Xxxxxx
-------------------------------------
Print Name: Xxxx Xxxxxx
Title: Vice President
GALAXY CLO 1999-1, Ltd.
By:/s/ Xxxxxx X. Xxxxxx
-------------------------------------
Print Name: Xxxxxx X. Xxxxxx
Title: Managing Director
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PINEHURST TRADING, INC.
By:/s/ Xxx X. Xxxxxx
-------------------------------------
Print Name: Xxx X. Xxxxxx
Title: Assistant Vice President
CENTREPACIFIC SIERRA CLO I
By:/s/ Xxxx X. Xxxxxxxxx
-------------------------------------
Print Name: Xxxx X. Xxxxxxxxx
Title: Chief Operating Officer
PB CAPITAL CORPORATION
By:/s/ Xxxx Xxxx
-------------------------------------
Print Name: Xxxx Xxxx
Title: Associate
By:/s/ Xxxxxxx Xxxxx
-------------------------------------
Print Name: Xxxxxxx Xxxxx
Title: Managing Director,
Portfolio Management
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