Exhibit 10.31
SECOND AMENDMENT TO CREDIT AGREEMENT
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This Second Amendment to Credit Agreement is made as of the 16th day of
March, 1998 by and among PRIME GROUP REALTY, L.P., a Delaware limited
partnership (the "Borrower"), PRIME GROUP REALTY TRUST, a Maryland trust (the
"Company") and BANKBOSTON, N.A., a national banking association ("BankBoston"),
PRUDENTIAL SECURITIES CREDIT CORPORATION, a Delaware corporation ("Prudential"),
the other lending institutions which are from time to time listed on Schedule 1,
(collectively, with BankBoston and Prudential, the "Lenders") and BANKBOSTON,
N.A., as agent for itself and such other lending institutions (the "Agent").
WHEREAS, the parties hereto are parties to that certain Credit Agreement
dated as of November 17, 1997 as amended by First Amendment to Credit Agreement
dated as of December 15, 1997 (the "Existing Agreement"); and
WHEREAS, the parties have agreed to amend the Existing Agreement to
decrease the Total Commitment, to further modify the definition of Collateral
Value and to make certain other modifications.
NOW, THEREFORE, the parties hereby agree that effective upon the date
hereof the Existing Agreement is amended as follows:
1. Decrease in Total Commitment. The Total Commitment is hereby decreased
to $200,000,000 and each Lead Lender hereby decreases its Commitment to the
amount shown on the revised Schedule 1.2 attached hereto. Effective upon the
earlier to occur of (i) the date that the Continental Towers Property is no
longer an Assigned Mortgaged Property or (ii) April 24, 1998, the Total
Commitment shall be further decreased to $190,000,000. Such further decrease
shall be accomplished by decreasing the Commitment of each Lead Lender by
$5,000,000.
2. Definitions: (S)1.1 of the Existing Agreement is amended to provide
that the following terms shall have the following meanings and, to the extent
that any of the following terms are already defined in the Existing Agreement,
such definitions shall be deemed to be amended and restated by the following
definitions:
Applicable Margin. As of any date of determination:
(i) 1.20%, if Total Liabilities are less than 30% of Total Adjusted
Assets, or
(ii) 1.35%, if Total Liabilities are equal to or less than 45% of Total
Adjusted Assets but the condition set forth in clause (i) of this definition is
not satisfied,
(iii) 1.50% if Total Liabilities exceed 45% of Total Adjusted Assets.
Any change in the Applicable Margin caused by a change in the ratio of Total
Liabilities to Total Adjusted Assets shall become effective on the 46th day
following the end of the fiscal quarter at
which such ratio was computed as shown on a Compliance Certificate which
reflects such change in said ratio above or below the 30% level or the 45%
level. Notwithstanding anything to the contrary in this definition for so long
as the Continental Towers Property is an Assigned Mortgaged Property, the
Applicable Margin will be 2.00%.
Collateral Value. With respect to each Mortgaged Property an amount equal
to the lesser of its Appraised Value or its Borrowing Base Value, provided that
the Collateral Value of an Assigned Mortgaged Property shall not exceed the
lesser of (i) the Borrower's net acquisition cost for the Assigned Note and
related documents or (ii) the outstanding principal amount of the applicable
Assigned Note and provided that effective on April 24, 1998 the Collateral Value
of the Continental Towers Property shall become zero.
Real Estate. All real property at any time owned, leased (as lessee or
sublessee) or operated by the Borrower, any Guarantor, or any of the Related
Companies or any Permitted Joint Venture. The term Real Estate also includes the
properties subject to the Security Deeds relating to the Assigned Mortgaged
Properties.
3. Updated Schedules to Credit Agreement. The following Schedules to the
Credit Agreement are hereby updated, supplemented or replaced as follows:
(a) Schedule 1.1 is replaced by Schedule 1.1 attached hereto.
(b) Schedule 1.2 is replaced by Schedule 1.2 attached hereto.
(c) Schedule 1.4 is replaced by Schedule 1.4 attached hereto.
4. Representations and Warranties. The Borrower and the Company represent
and warrant that each of the representations and warranties contained in (S)6 is
true, correct and complete in all material respects as of the date hereof to the
same extent as though made on such date and that no Default or Event of Default
has occurred and is continuing on the date hereof.
5. Effectiveness of Loan Documents. The Borrower hereby confirms that
each of the Security Documents shall continue to secure the payment and
performance of all of the Obligations under the Existing Agreement as amended
hereby and the Borrower's obligations under the Security Documents shall
continue to be valid and enforceable and shall not be impaired or limited by the
execution or effectiveness of this Amendment. Every reference contained in the
Loan Documents to the Credit Agreement shall mean and be a reference to the
Existing Agreement as amended hereby and as the Credit Agreement may be further
amended. Except as specifically amended by this Amendment, the Existing
Agreement and each of the Loan Documents shall remain in full force and effect
and are hereby ratified and confirmed.
6. Miscellaneous. This Amendment shall be governed by, interpreted and
construed in accordance with all of the same provisions applicable under the
Existing Agreement including, without limitation, all definitions set forth in
(S)1.1, the rules of interpretation set forth in (S)1.2, the
provisions relating to governing law set forth in (S)20, the provisions relating
to counterparts in (S)22 and the provision relating to severability in (S)26.
IN WITNESS WHEREOF, the undersigned have duly executed this Agreement as a
sealed instrument as of the date first set forth above.
WITNESS: BANKBOSTON, N.A.
/s/ Xxxxxx X. Xxxxxxx By: /s/ Xxxx X. Xxxxx
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Xxxx X. Xxxxx
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Its: Vice President
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PRUDENTIAL SECURITIES CREDIT
CORPORATION
____________________________ By: /s/ Xxxx X. Xxxxxx
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Xxxx X. Xxxxxx
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Its: Vice President
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PRIME GROUP REALTY TRUST
/s/ Xxxxxxx X. XxXxxxxx By: /s/ Xxxxxxx X. Xxxxxx
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Xxxxxxx X. Xxxxxx
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Its: Executive Vice President and
Chief Financial Officer
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PRIME GROUP REALTY, L.P.
By: PRIME GROUP REALTY TRUST,
its managing general partner
/s/ Xxxxxxx X. XxXxxxxx By: /s/ Xxxxxxx X. Xxxxxx
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Xxxxxxx X. Xxxxxx
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Its: Executive Vice President and
Chief Financial Officer
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SCHEDULE 1.1
Mortgaged Properties
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1. Donnelley Building, 00 Xxxx Xxxxxx Xxxxx, Xxxxxxx, XX
2. Hilton Parking Garage, Knoxville, TN
3. SunTrust Bank Bldg., 000 0xx Xxx., X., Xxxxxxxxx, XX
4. The Weston, 0000 Xxxxxxxx Xxxx, Xxxxxxxxx, XX
5. Xxx Xxxxxx Xxxxxx, 000 Xxxxxx Xx., Xxxxxxxxx, XX
6. Xxx Xxxxxx Xxxxxx, 000 Xxx Xx., Xxxxxxxxx, XX
Assigned Mortgaged Properties
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7. Continental Towers, Rolling Xxxxxxx, Xxxx County, Illinois
SCHEDULE 1.2
Commitments
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Commitment
Lender Commitment Percentage
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BankBoston, N.A. $100,000,000 50%
Prudential Securities Credit Corporation $100,000,000 50%
Total $200,000,000 100%
SCHEDULE 1.4
Letters of Credit
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Beneficiary IRB Project Face Amount
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First Tennessee Bank N.A. Nashville Office Building I, Ltd. $ 4,915,069.00
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First Tennessee Bank N.A. Old Kingston Properties, Ltd. $ 3,583,905.00
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First Tennessee Bank N.A. Professional Plaza, Ltd. $ 9,215,754.00
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First Tennessee Bank N.A. Centre Square II, Ltd. $ 9,215,754.00
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TOTAL $26,930,482.00
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