EXHIBIT 10.68
Credit Agreement dated as of July 10, 2003,
among RFS Partnership, L.P. and RFS Financing Partnership, L.P.
as Borrowers,
CNL Hospitality Properties, Inc., as Parent,
Bank of America, N.A., as Administrative Agent,
and the lenders named herein, as Lenders
$320,000,000
Banc of America Securities LLC,
as Sole Lead Arranger and Sole Book Manager
================================================================================
CREDIT AGREEMENT
Dated as of July 10, 2003
among
RFS Partnership, L.P.,
and
RFS Financing Partnership, L.P.,
as Borrowers,
CNL HOSPITALITY PROPERTIES, INC.,
as Parent,
BANK OF AMERICA, N.A.,
as Administrative Agent,
and
THE LENDERS NAMED HEREIN,
as Lenders
$320,000,000
BANC OF AMERICA SECURITIES LLC,
as Sole Lead Arranger and Sole Book Manager
================================================================================
TABLE OF CONTENTS
ARTICLE I. DEFINITIONS AND ACCOUNTING TERMS .................................................................................... 1
1.01 Defined Terms. ....................................................................................................... 1
1.02 Other Interpretive Provisions. ....................................................................................... 19
1.03 Accounting Terms. .................................................................................................... 20
1.04 Rounding. ............................................................................................................ 20
1.05 References to Agreements and Laws. ................................................................................... 20
1.06 Times of Day. ........................................................................................................ 20
ARTICLE II. THE COMMITMENTS .................................................................................................... 20
2.01 Loans. ............................................................................................................... 20
2.02 Borrowings, Conversions, and Continuations of Loans. ................................................................. 21
2.03 Prepayments. ......................................................................................................... 22
2.04 Termination or Reduction of Commitments. ............................................................................. 22
2.05 Repayment of Loans. .................................................................................................. 23
2.06 Interest. ............................................................................................................ 23
2.07 Fees. ................................................................................................................ 23
2.08 Computation of Interest and Fees. .................................................................................... 24
2.09 Evidence of Debt. .................................................................................................... 24
2.10 Payments Generally. .................................................................................................. 24
2.11 Sharing of Payments. ................................................................................................. 26
2.12 Collateral; Guaranties. .............................................................................................. 26
ARTICLE III. TAXES, YIELD PROTECTION AND ILLEGALITY ............................................................................ 27
3.01 Taxes. ............................................................................................................... 27
3.02 Illegality. .......................................................................................................... 28
3.03 Inability to Determine Rates. ........................................................................................ 28
3.04 Increased Cost and Reduced Return; Capital Adequacy; Reserves on Eurodollar Rate Loans. .............................. 29
3.05 Funding Losses. ...................................................................................................... 29
3.06 Matters Applicable to all Requests for Compensation. ................................................................. 30
3.07 Survival. ............................................................................................................ 30
ARTICLE IV. CONDITIONS PRECEDENT TO BORROWINGS ................................................................................. 30
4.01 Conditions of Initial Borrowing. ..................................................................................... 30
4.02 Conditions to all Borrowings. ........................................................................................ 34
4.03 Special Conditions. .................................................................................................. 35
ARTICLE V. REPRESENTATIONS AND WARRANTIES ...................................................................................... 35
5.01 Existence, Qualification, and Power; Compliance with Laws. ........................................................... 35
5.02 Authorization; No Contravention. ..................................................................................... 36
5.03 Governmental Authorization; Other Consents. .......................................................................... 36
5.04 Binding Effect. ...................................................................................................... 36
5.05 Financial Statements; No Material Adverse Effect. .................................................................... 36
5.06 Litigation. .......................................................................................................... 36
5.07 No Default. .......................................................................................................... 37
5.08 Ownership of Property; Liens. ........................................................................................ 37
5.09 Environmental Representations. ....................................................................................... 37
5.10 Insurance. ........................................................................................................... 38
5.11 Taxes. ............................................................................................................... 38
5.12 ERISA Compliance. .................................................................................................... 38
5.13 Margin Regulations; Investment Company Act; Public Utility Holding Company Act. ...................................... 39
5.14 Disclosure. .......................................................................................................... 39
Credit Agreement i
5.15 Compliance with Laws. ............................................. 39
5.16 Tax Shelter Regulations. .......................................... 39
5.17 Intellectual Property; Licenses; Etc. ............................. 40
5.18 Drainage/Condemnation/Zoning. ..................................... 40
5.19 Property Condition. ............................................... 40
5.20 Representations Concerning Leases. ................................ 40
5.21 Contracts and Plans. .............................................. 40
5.22 Condemnation. ..................................................... 41
5.23 Reciprocal Agreements. ............................................ 41
5.24 Management Agreements. ............................................ 41
5.25 Franchise Agreements. ............................................. 41
5.26 Ground Lease Representations. ..................................... 41
5.27 Knowledge. ........................................................ 42
ARTICLE VI. AFFIRMATIVE COVENANTS ........................................... 43
6.01 Financial Statements. ............................................. 43
6.02 Certificates; Other Information. .................................. 44
6.03 Notice Requirements. .............................................. 45
6.04 Payment of Obligations. ........................................... 46
6.05 Preservation of Existence, Etc. ................................... 46
6.06 Maintenance of Properties. ........................................ 46
6.07 Maintenance of Insurance. ......................................... 46
6.08 Compliance with Laws. ............................................. 47
6.09 Books and Records. ................................................ 47
6.10 Inspection Rights. ................................................ 47
6.11 Use of Proceeds. .................................................. 48
6.12 Other Property Information. ....................................... 48
6.13 Reports and Testing. .............................................. 48
6.14 Environmental Matters. ............................................ 48
6.15 Contracts. ........................................................ 50
6.16 Casualty. ......................................................... 50
6.17 Condemnation. ..................................................... 50
6.18 Restoration. ...................................................... 51
6.19 Property Management. .............................................. 54
6.20 Franchise Agreements. ............................................. 55
6.21 Ground Leases. .................................................... 56
6.22 Operating Leases. ................................................. 57
6.23 Post-Closing Collateral Property Covenants. ....................... 57
ARTICLE VII. NEGATIVE COVENANTS ............................................. 57
7.01 Liens. ............................................................ 57
7.02 Investments. ...................................................... 58
7.03 Indebtedness. ..................................................... 58
7.04 Fundamental Changes. .............................................. 59
7.05 Dispositions. ..................................................... 59
7.06 Restricted Payments. .............................................. 60
7.07 Change in Nature of Business. ..................................... 60
7.08 Transactions with Affiliates. ..................................... 60
7.09 Burdensome Agreements. ............................................ 60
7.10 Use of Proceeds. .................................................. 61
7.11 Contracts. ........................................................ 61
7.12 Lease Approval. ................................................... 61
7.13 No Other Liens. ................................................... 61
Credit Agreement ii
7.14 Reciprocal Easement Agreements. Neither Borrower shall: .............. 61
7.15 Parent Financial Covenants. .......................................... 62
7.16 Operating Company Financial Covenants. ............................... 62
7.17 Loan to Value Ratio. ................................................. 62
7.18 REIT Status. ......................................................... 62
ARTICLE VIII. EVENTS OF DEFAULT AND REMEDIES ................................... 62
8.01 Events of Default. ................................................... 62
8.02 Remedies Upon Event of Default. ...................................... 65
8.03 Application of Funds. ................................................ 65
ARTICLE IX. ADMINISTRATIVE AGENT ............................................... 66
9.01 Appointment and Authorization of Administrative Agent. ............... 66
9.02 Delegation of Duties. ................................................ 66
9.03 Liability of Administrative Agent. ................................... 66
9.04 Reliance by Administrative Agent. .................................... 66
9.05 Notice of Default. ................................................... 67
9.06 Credit Decision; Disclosure of Information by Administrative Agent. .. 67
9.07 Indemnification of Administrative Agent. ............................. 68
9.08 Administrative Agent in its Individual Capacity. ..................... 68
9.09 Successor Administrative Agent. ...................................... 68
9.10 Exercise of Rights; Proofs of Claim. ................................. 69
9.11 Releases; Acquisition; and Transfers of Collateral. .................. 70
9.12 Other Agents, Arrangers, and Managers. ............................... 71
ARTICLE X. MISCELLANEOUS ....................................................... 71
10.01 Amendments, Etc. .................................................... 71
10.02 Notices and Other Communications; Facsimile Copies. ................. 72
10.03 No Waiver; Cumulative Remedies. ..................................... 73
10.04 Attorney Costs, Expenses and Taxes. ................................. 74
10.05 Indemnification by Parent and Borrowers. ............................ 74
10.06 Payments Set Aside. ................................................. 75
10.07 Successors and Assigns. ............................................. 76
10.08 Confidentiality. .................................................... 78
10.09 Set-off. ............................................................ 79
10.10 Interest Rate Limitation. ........................................... 79
10.11 Counterparts. ....................................................... 79
10.12 Integration. ........................................................ 79
10.13 Survival of Representations and Warranties. ......................... 79
10.14 Severability. ....................................................... 79
10.15 Tax Forms. .......................................................... 80
10.16 Replacement of Lenders. ............................................. 81
10.17 Appraisal. .......................................................... 81
10.18 Assignment of Contracts and Plans. .................................. 81
10.19 Governing Law. ...................................................... 82
10.20 Waiver of Right to Trial by Jury. ................................... 82
10.21 Time of the Essence. ................................................ 82
10.22 ENTIRE AGREEMENT. ................................................... 82
SIGNATURES...................................................................... S-1
Credit Agreement iii
SCHEDULES
1.01(a) Excluded Collateral Properties
1.01(b) Franchisors, Managers, and Operating Lessees
2.01 Commitments and Pro Rata Shares
2.03 Permitted Issuances of Indebtedness and Equity
2.12(i) Pledged Subsidiaries
2.12(ii) Collateral Properties
5.06 Litigation
6.23 Post-Closing Covenants
7.01 Existing Liens
7.02 Subsidiaries
7.03 Existing Indebtedness
7.05 Collateral Property Dispositions
10.02 Administrative Agent's Office, Certain Addresses for Notices
EXHIBITS
Form of:
A Loan Notice
B Note
C Compliance Certificate
D Assignment and Assumption
E Survey Requirements
Credit Agreement iv
CREDIT AGREEMENT
This CREDIT AGREEMENT is entered into as of July 10, 2003 (the "Closing
Date"), among RFS PARTNERSHIP, L.P., a Tennessee limited partnership ("Operating
Company"), and RFS FINANCING PARTNERSHIP, L.P., a Tennessee limited partnership
("Financing," and together with Operating Company, "Borrowers"), CNL Hospitality
Properties, Inc., a Maryland corporation ("Parent"), each lender from time to
time party hereto (collectively, "Lenders" and individually, a "Lender"), and
BANK OF AMERICA, N.A., as Administrative Agent ("Administrative Agent").
Borrowers have requested that Lenders provide a term loan facility, and
Lenders are willing to do so on the terms and conditions set forth herein.
In consideration of the mutual covenants and agreements herein contained,
the parties hereto covenant and agree as follows:
DEFINITIONS AND ACCOUNTING TERMS
Defined Terms. As used in this Agreement, the following terms shall have
the meanings set forth below:
"Acceptable Appraisal" means an appraisal commissioned by and addressed to
Administrative Agent (acceptable to Administrative Agent as to form, substance,
and date), prepared by a professional appraiser acceptable to Administrative
Agent, and having the minimum qualifications required under all applicable Laws.
"Acquisition Sub" means CNL Rose Acquisition Corp., a Delaware corporation.
"Administrative Agent" means Banc of America Bridge LLC acting for itself
or through one of its Affiliates, including Bank of America, N.A., in its
capacity as administrative agent under any of the Loan Documents, or any
successor administrative agent.
"Administrative Agent's Office" means Administrative Agent's address and,
as appropriate, account as set forth on Schedule 10.02, or such other address or
account as Administrative Agent may from time to time notify Borrowers and
Lenders.
"Administrative Questionnaire" means an Administrative Questionnaire in a
form supplied by Administrative Agent.
Credit Agreement
"Affiliate" means, with respect to any Person, another Person that
directly, or indirectly through one or more intermediaries, Controls or is
Controlled by or is under common Control with the Person specified. "Control"
means the possession, directly or indirectly, of the power to direct or cause
the direction of the management or policies of a Person, whether through the
ability to exercise voting power, by contract or otherwise. "Controlling" and
"Controlled" have meanings correlative thereto. Without limiting the generality
of the foregoing, a Person shall be deemed to be Controlled by another Person if
such other Person possesses, directly or indirectly, power to vote ten percent
(10%) or more of the securities having ordinary voting power for the election of
directors, managing general partners or the equivalent.
"Agent-Related Persons" means Administrative Agent, together with its
Affiliates (including, in the case of Bank of America in its capacity as
Administrative Agent, the Arranger), and the officers, directors, employees,
agents and attorneys-in-fact of such Persons and Affiliates.
"Aggregate Collateral Value" means the sum of the Collateral Values for all
of the Collateral Properties; provided that the Collateral Value for the
Excluded Collateral Properties shall not be included in Aggregate Collateral
Value.
"Aggregate Commitments" means the Commitments of all Lenders.
"Agreement" means this Credit Agreement.
"Applicable Margin" means (a) with respect to Eurodollar Rate Loans, three
percent (3%), and (b) with respect to Base Rate Loans, one and one-half percent
(1-1/2 %). Subject to Section 10.10, the Applicable Margin shall increase by an
amount equal to one-half of one percent (.50%) on November 7, 2003 and on the
last day of each subsequent three (3) month period thereafter.
"Appraised Value" means, with respect to any Collateral Property as of any
date, the appraised value of such Collateral Property pursuant to an Acceptable
Appraisal.
"Approved Costs" means, for any Collateral Property, the sum of the
acquisition, construction, and other capitalized costs of such Collateral
Property (or the stock or other equity interest of the Person that owns such
Collateral Property), whether in the form of cash, property, liabilities
assumed, or other consideration.
"Arranger" means Banc of America Securities LLC, in its capacity as sole
lead arranger and sole book manager.
"Assignment and Assumption" means an Assignment and Assumption
substantially in the form of Exhibit D.
"Assignment of Management Agreement" means that certain Assignment and
Subordination of Management Agreement dated the date hereof among Administrative
Agent, the applicable Operating Lessee, Borrower, and Manager, as the same may
be amended, restated, replaced, supplemented, or otherwise modified from time to
time.
"Attorney Costs" means and includes all fees, expenses, and disbursements
of any law firm or other external counsel and, without duplication, the
allocated cost of internal legal services and all expenses and disbursements of
internal counsel.
Credit Agreement 1
"Attributable Indebtedness" means, on any date, (a) in respect of any
capital lease of any Person, the capitalized amount thereof that would appear on
a balance sheet of such Person prepared as of such date in accordance with GAAP,
and (b) in respect of any Synthetic Lease Obligation, the capitalized amount of
the remaining lease payments under the relevant lease that would appear on a
balance sheet of such Person prepared as of such date in accordance with GAAP if
such lease were accounted for as a capital lease.
"Audited Financial Statements" means (a) the audited consolidated balance
sheet of Operating Company and its Subsidiaries for the fiscal year ended
December 31, 2002, and the related consolidated statements of income or
operations, shareholders' equity, and cash flows for such fiscal year of
Operating Company and its Subsidiaries, including the notes thereto, and (b)
audited consolidated balance sheet of Parent and its Subsidiaries for the fiscal
year ended December 31, 2002, and related consolidated statements of income or
operations, shareholders' equity, and cash flows for such fiscal year of Parent
and its Subsidiaries, including the notes thereto.
"Award" means any compensation paid by any Governmental Authority in
connection with a Condemnation in respect of all or any part of any Collateral
Property.
"Bank of America" means Bank of America, N.A. and its successors.
"Base Rate" means for any day a fluctuating rate per annum equal to the
higher of (a) the Federal Funds Rate plus one-half of one percent (.50%) and (b)
the rate of interest in effect for such day as publicly announced from time to
time by Bank of America as its "prime rate." The "prime rate" is a rate set by
Bank of America based upon various factors including Bank of America's costs and
desired return, general economic conditions and other factors, and is used as a
reference point for pricing some loans, which may be priced at, above, or below
such announced rate. Any change in such rate announced by Bank of America shall
take effect at the opening of business on the day specified in the public
announcement of such change.
"Base Rate Loan" means a Loan that bears interest based on the Base Rate
plus the Applicable Margin.
"Borrower" and "Borrowers" have the meanings specified in the introductory
paragraph hereto.
"Borrowing" means a borrowing consisting of simultaneous Loans of the same
Type and, in the case of Eurodollar Rate Loans, having the same Interest Period
made by each of Lenders pursuant to Section 2.01.
"Business Day" means any day other than a Saturday, Sunday, or other day on
which commercial banks are authorized to close under the Laws of, or are in fact
closed in, the state where Administrative Agent' s Office is located and, if
such day relates to any Eurodollar Rate Loan, means any such day on which
dealings in Dollar deposits are conducted by and between banks in the London
interbank eurodollar market.
"Casualty" has the meaning specified in Section 6.17.
"Change of Control" means, with respect to any Person, an event or series
of events by which:
(a) any "person" or "group" (as such terms are used in Sections 13(d)
and 14(d) of the Securities Exchange Act of 1934, but excluding any
employee benefit plan of such person or its subsidiaries, and any person or
entity acting in its capacity as trustee, agent or other fiduciary
Credit Agreement 2
or administrator of any such plan) becomes the "beneficial owner" (as
defined in Rules 13d-3 and 13d-5 under the Securities Exchange Act of 1934,
except that a person or group shall be deemed to have "beneficial
ownership" of all securities that such person or group has the right to
acquire (such right, an "option right"), whether such right is exercisable
immediately or only after the passage of time), directly or indirectly, of
twenty-five percent (25%) or more of the equity securities of such Person
entitled to vote for members of the board of directors or equivalent
governing body of such Person on a fully-diluted basis (and taking into
account all such securities that such person or group has the right to
acquire pursuant to any option right); or
(b) during any period of twelve (12) consecutive months, a majority
of the members of the board of directors or other equivalent governing body
of such Person cease to be composed of individuals (i) who were members of
that board or equivalent governing body on the first day of such period,
(ii) whose election or nomination to that board or equivalent governing
body was approved by individuals referred to in clause (i) above
constituting at the time of such election or nomination at least a majority
of that board or equivalent governing body, or (iii) whose election or
nomination to that board or other equivalent governing body was approved by
individuals referred to in clauses (i) and (ii) above constituting at the
time of such election or nomination at least a majority of that board or
equivalent governing body (excluding, in the case of both clause (ii) and
clause (iii), any individual whose initial nomination for, or assumption of
office as, a member of that board or equivalent governing body occurs as a
result of an actual or threatened solicitation of proxies or consents for
the election or removal of one or more directors by any person or group
other than a solicitation for the election of one or more directors by or
on behalf of the board of directors).
"Closing Date" has the meaning set forth in the introductory paragraph
hereto.
"CMBS Borrowers" means each to-be-formed single purpose, bankruptcy remote
entity which shall become a wholly-owned direct or indirect Subsidiary of
Operating Company and which will be the borrower under a CMBS Facility.
"CMBS Collateral Properties" means the Collateral Properties listed in Part
A of Schedule 2.12(ii), and "CMBS Collateral Property" means any one of the CMBS
Collateral Properties.
"CMBS Engagement Letter" means that certain best efforts engagement letter
dated June 30, 2003 from Banc of America Securities LLC to Parent.
"CMBS Facilities" means the proposed extensions of credit from Bank of
America to one or more CMBS Borrowers to be secured by mortgage Liens on all or
a portion of the CMBS Collateral Properties, and "CMBS Facility" means any one
of the CMBS Facilities.
"CNL Collateral Properties" means the Collateral Properties listed in Part
B of Schedule 2.12(ii), and "CNL Collateral Property" means any one of the CNL
Collateral Properties.
"Code" means the Internal Revenue Code of 1986.
"Collateral Properties" means the hotels and resorts, the Improvements, and
all other property as described in the Mortgages to be delivered pursuant to
Section 2.12(a), and subject to a right, Lien, or security interest to secure
the Obligations, and "Collateral Property" means any one of the Collateral
Properties.
Credit Agreement 3
"Collateral Value" means, as of any date of determination, (a) with respect
to any CNL Collateral Property, the lesser of (i) the Appraised Value of such
Collateral Property, and (ii) the Approved Costs of such Collateral Property,
and (b) with respect to any CMBS Collateral Property, (i) Consolidated EBITDA
for such CMBS Collateral Property for the most recent twelve (12) months ending
on or before the date of determination divided by (ii) eleven percent (11%). The
Collateral Value for each of the Collateral Properties as of the Closing Date is
set forth on Schedule 2.12(ii).
"Commitment" means, as to each Lender, its obligation to make Loans to
Borrowers pursuant to Section 2.01 in an aggregate principal amount at any one
time outstanding not to exceed the amount set forth opposite such Lender's name
on Schedule 2.01 or in the Assignment and Assumption pursuant to which such
Lender becomes a party hereto, as applicable, as such amount may be adjusted
from time to time in accordance with this Agreement.
"Compliance Certificate" means a certificate substantially in the form of
Exhibit C.
"Condemnation" means a temporary or permanent taking by any Governmental
Authority as the result, in lieu, or in anticipation, of the exercise of the
right of condemnation or eminent domain, of all or any part of the Collateral
Properties, or any interest therein or right accruing thereto, including any
right of access thereto or any change of grade affecting the Collateral
Properties or any part thereof.
"Condemnation Proceeds" has the meaning specified in Section 6.18(b).
"Consolidated EBITDA" means, for any period, for any Person or any
Collateral Property, an amount equal to (a) Consolidated Net Income for such
period, plus (b) the following to the extent deducted in calculating such
Consolidated Net Income: (i) Consolidated Interest Charges for such period, (ii)
the provision for federal, state, local, and foreign income taxes payable by
such Person and its Subsidiaries or with respect to such Collateral Property for
such period, (iii) the amount of depreciation and amortization expense deducted
in determining such Consolidated Net Income, and (iv) other expenses reducing
such Consolidated Net Income which do not represent a cash item in such period
or any future period, minus (c) all non-cash items increasing Consolidated Net
Income for such period, minus (d) FF&E Reserves, minus (e) Management Fee
Reserves for such period in excess of actual management fees deducted in
determining Consolidated Net Income for such period. For purposes of determining
Consolidated EBITDA for any Collateral Property, such Collateral Property's
proportionate share of costs and expenses for property taxes, insurance,
management fees, and other property related costs shall be deducted to the
extent that such costs and expenses are paid on the Collateral Properties as a
pool pursuant to a master agreement covering multiple Collateral Properties and
not paid on an individual Collateral Property basis.
"Consolidated Fixed Charge Coverage Ratio" means, for any Person as of the
last day of any fiscal quarter, the ratio of (a) Consolidated EBITDA, to (b)
Fixed Charges, in each case for the four (4) fiscal quarters ending on the date
of determination. For purposes of calculating the Fixed Charge Coverage Ratio
for the first four (4) fiscal quarters following the Closing Date, (i) Fixed
Charges shall be calculated on a pro forma basis as if all Indebtedness
outstanding as of the date of determination were outstanding during the four (4)
fiscal quarters ending on the date of determination, (ii) Consolidated EBITDA
shall be calculated on a pro forma basis as if all Consolidated Net Income for
any Person or Property acquired during the period of determination was acquired
on the first (1st) day of such period of determination, and (iii) Consolidated
EBITDA and Fixed Charges of any Person shall include, to the extent not already
included in such calculation, such Person's Share of the Consolidated EBITDA and
Fixed Charges of any partnership or joint venture (other than a Subsidiary of
such Person or a joint venture that is itself a corporation or limited liability
company) in which such Person is a general partner or a joint venturer.
Credit Agreement 4
"Consolidated Funded Indebtedness" means, as of any date of determination,
for any Person, the sum of (a) the outstanding principal amount of all
Indebtedness whether current or long-term, for borrowed money (including
Obligations hereunder) and all Indebtedness evidenced by bonds, debentures,
notes, loan agreements, or other similar instruments, (b) all purchase money
Indebtedness, (c) all direct obligations arising under letters of credit
(including standby and commercial), bankers' acceptances, bank guaranties,
surety bonds, and similar instruments, (d) all obligations in respect of the
deferred purchase price of property or services (other than trade accounts
payable in the ordinary course of business), (e) Attributable Indebtedness in
respect of capital leases and Synthetic Lease Obligations, and (f) without
duplication, all Guarantees with respect to outstanding Indebtedness of the
types specified in clauses (a) through (e) above of Persons other than such
Person or any of its Subsidiaries.
"Consolidated Interest Charges" means, for any period, for any Person or
for any Collateral Property, the sum of (a) all interest, premium payments, debt
discount, fees, charges, and related expenses of such Person, or with respect to
such Collateral Property, as applicable, in connection with borrowed money
(including capitalized interest) or in connection with the deferred purchase
price of assets, in each case to the extent treated as interest in accordance
with GAAP, and (b) the portion of rent expense of such Person, or with respect
to such Collateral Property, as applicable, with respect to such period under
capital leases that is treated as interest in accordance with GAAP.
"Consolidated Leverage Ratio" means, for Parent and its Subsidiaries on a
consolidated basis as of any date of determination, the ratio of (a)
Consolidated Funded Indebtedness, to (b) Consolidated Funded Indebtedness plus
Shareholders' Equity minus Intangible Assets.
"Consolidated Net Income" means, for any period, for any Person or for any
Collateral Property, the net income of such Person or Collateral Property
(excluding extraordinary gains but including extraordinary losses) for that
period.
"Consolidated Tangible Net Worth" means, for Parent and its Subsidiaries on
a consolidated basis as of any date of determination, Shareholders' Equity on
that date minus Intangible Assets on that date.
"Contractual Obligation" means, as to any Person, any provision of any
security issued by such Person or of any agreement, instrument, or other
undertaking to which such Person is a party or by which it or any of its
property is bound.
"Control" has the meaning specified in the definition of "Affiliate."
"Debt Service" means, for any Person for any period, the sum of (a) all
regularly scheduled principal payments, and (b) all Consolidated Interest
Charges, in each case paid or payable during such period in respect of all
Indebtedness of such Person.
"Debtor Relief Laws" means the Bankruptcy Code of the United States, and
all other liquidation, conservatorship, bankruptcy, assignment for the benefit
of creditors, moratorium, rearrangement, receivership, insolvency,
reorganization, or similar debtor relief Laws of the United States or other
applicable jurisdictions from time to time in effect and affecting the rights of
creditors generally.
"Default" means any event or condition that constitutes an Event of Default
or that, with the giving of any notice, the passage of time, or both, would be
an Event of Default.
"Default Rate" means an interest rate equal to (a) the Base Rate plus (b)
four percent (4%) per annum; provided, however, that with respect to a
Eurodollar Rate Loan, the Default Rate shall be an
Credit Agreement 5
interest rate equal to the interest rate otherwise applicable to such Loan plus
four percent (4%) per annum, in each case to the fullest extent permitted by
applicable Laws.
"Defaulting Lender" means any Lender that (a) has failed to fund any
portion of the Loans required to be funded by it hereunder within one Business
Day of the date required to be funded by it hereunder, (b) has otherwise failed
to pay over to Administrative Agent or any other Lender any other amount
required to be paid by it hereunder within one Business Day of the date when
due, unless the subject of a good faith dispute, or (c) has been deemed
insolvent or become the subject of a bankruptcy or insolvency proceeding.
"Disposition" or "Dispose" means the sale, transfer, license, lease (other
than any Tenant Lease or Operating Lease), or other disposition (including any
sale and leaseback transaction) of any property by any Person, including any
sale, assignment, transfer, or other disposal, with or without recourse, of any
notes or accounts receivable or any rights and claims associated therewith.
"Dollar" and "$" mean lawful money of the United States.
"Eligible Assignee" has the meaning specified in Section 10.07(g).
"Environmental Claim" means any investigative, enforcement, cleanup,
removal, containment, remedial, or other private or governmental or regulatory
action at any time threatened, instituted, or completed pursuant to any
applicable Environmental Requirement (hereinafter defined), against Parent or
any Subsidiary or against or with respect to any Property or any condition, use,
or activity on any Property (including any such action against Administrative
Agent or any Lender), and any claim at any time threatened or made by any person
against Parent or any Subsidiary or against or with respect to any Property or
any condition, use, or activity on any Property (including any such claim
against Administrative Agent or any Lender), relating to damage, contribution,
cost recovery, compensation, loss, or injury resulting from or in any way
arising in connection with any Hazardous Material (hereinafter defined) or any
Environmental Requirement.
"Environmental Damages" means, whether before or after the Release Date:
(a) the presence of any Hazardous Material on any Property, or any escape,
seepage, leakage, spillage, emission, release, discharge, or disposal of any
Hazardous Material on or from any Property, or the migration or release or
threatened migration or release of any Hazardous Material to, from, or through
any Property, on or before the Release Date; or (b) any act, omission, event, or
circumstance existing or occurring in connection with the handling, treatment,
containment, removal, storage, decontamination, clean-up, transport, or disposal
of any Hazardous Material which is at any time on or before the Release Date
present on any Property; or (c) the breach of any representation, warranty,
covenant, or agreement contained in this Agreement because of any event or
condition occurring or existing on or before the Release Date; or (d) any
violation on or before the Release Date, of any Environmental Requirement in
effect on or before the Release Date, regardless of whether any act, omission,
event, or circumstance giving rise to the violation constituted a violation at
the time of the occurrence or inception of such act, omission, event, or
circumstance; or (e) any Environmental Claim, or the filing or imposition of any
environmental lien against any Property, because of, resulting from, in
connection with, or arising out of any of the matters referred to in subsections
(a) through (d) preceding; and regardless of whether any of the foregoing
subsections (a) through (e) was caused by a Borrower or a tenant or subtenant,
or a prior owner of any Property or its tenant or subtenant, or any third party,
including but not limited to: (i) injury or damage to any person, property, or
natural resource occurring on or off of such Property, including but not limited
to the cost of demolition and rebuilding of any improvements on real property;
(ii) the investigation or remediation of any such Hazardous Material or
violation of Environmental Requirement, including but not limited to the
preparation of any feasibility studies or reports and the performance of any
cleanup, remediation,
Credit Agreement 6
removal, response, abatement, containment, closure, restoration, monitoring, or
similar work required by any Environmental Requirement or necessary to have full
use and benefit of such Property as contemplated by the Loan Documents
(including any of the same in connection with any foreclosure action or transfer
in lieu thereof); (iii) all liability to pay or indemnify any person or
Governmental Authority for costs expended in connection with any of the
foregoing; (iv) the investigation and defense of any claim, whether or not such
claim is ultimately defeated; and (v) the settlement of any claim or judgment.
"Environmental Laws" means any and all Federal, state, local, and foreign
statutes, laws, regulations, ordinances, rules, judgments, orders, decrees,
permits, concessions, grants, franchises, licenses, agreements, or governmental
restrictions relating to pollution and the protection of the environment or the
release of any materials into the environment, including those related to
hazardous substances or wastes, air emissions, and discharges to waste or public
systems.
"Environmental Requirement " means any Environmental Law (hereinafter
defined), agreement or restriction (including but not limited to any condition
or requirement imposed by any insurance or surety company), as the same now
exists or may be changed or amended or come into effect in the future, which
pertains to health, safety, any Hazardous Material, or the environment,
including but not limited to ground or air or water or noise pollution or
contamination, and underground or aboveground tanks.
"ERISA" means the Employee Retirement Income Security Act of 1974.
"ERISA Affiliate" means any trade or business (whether or not incorporated)
under common control with either Borrower within the meaning of Section 414(b)
or (c) of the Code (and Sections 414(m) and (o) of the Code for purposes of
provisions relating to Section 412 of the Code).
"ERISA Event" means (a) a Reportable Event with respect to a Pension Plan;
(b) a withdrawal by either Borrower or any ERISA Affiliate from a Pension Plan
subject to Section 4063 of ERISA during a plan year in which it was a
substantial employer (as defined in Section 4001(a)(2) of ERISA) or a cessation
of operations that is treated as such a withdrawal under Section 4062(e) of
ERISA; (c) a complete or partial withdrawal by either Borrower or any ERISA
Affiliate from a Multiemployer Plan or notification that a Multiemployer Plan is
in reorganization; (d) the filing of a notice of intent to terminate, the
treatment of a Plan amendment as a termination under Sections 4041 or 4041A of
ERISA, or the commencement of proceedings by the PBGC to terminate a Pension
Plan or Multiemployer Plan; (e) an event or condition which constitutes grounds
under Section 4042 of ERISA for the termination of, or the appointment of a
trustee to administer, any Pension Plan or Multiemployer Plan; or (f) the
imposition of any liability under Title IV of ERISA, other than for PBGC
premiums due but not delinquent under Section 4007 of ERISA, upon either
Borrower or any ERISA Affiliate.
"Eurodollar Rate" means for any Interest Period with respect to any
Eurodollar Rate Loan:
(a) the rate per annum equal to the rate determined by
Administrative Agent to be the offered rate that appears on the page of the
Telerate screen (or any successor thereto) that displays an average British
Bankers Association Interest Settlement Rate for deposits in Dollars (for
delivery on the first day of such Interest Period) with a term equivalent
to such Interest Period, determined as of approximately 11:00 a.m. (London
time) two (2) Business Days prior to the first day of such Interest Period;
or
(b) if the rate referenced in the preceding clause (a) does not
appear on such page or service or such page or service shall not be
available, the rate per annum equal to the rate determined by
Administrative Agent to be the offered rate on such other page or other
service that
Credit Agreement 7
displays an average British Bankers Association Interest Settlement Rate
for deposits in Dollars (for delivery on the first day of such Interest
Period) with a term equivalent to such Interest Period, determined as of
approximately 11:00 a.m. (London time) two (2) Business Days prior to the
first day of such Interest Period; or
(c) if the rates referenced in the preceding clauses (a) and (b) are
not available, the rate per annum determined by Administrative Agent as the
rate of interest at which deposits in Dollars for delivery on the first day
of such Interest Period in same day funds in the approximate amount of the
Eurodollar Rate Loan being made, continued or converted by Administrative
Agent and with a term equivalent to such Interest Period would be offered
by Administrative Agent's London Branch to major banks in the London
interbank eurodollar market at their request at approximately 4:00 p.m.
(London time) two (2) Business Days prior to the first day of such Interest
Period.
"Eurodollar Rate Loan" means a Loan that bears interest at a rate based on
the Eurodollar Rate plus the Applicable Margin.
"Event of Default" has the meaning specified in Section 8.01.
"Excluded Collateral Property" means each Collateral Property listed on
Schedule 1.01(a) until Administrative Agent notifies Borrowers in writing as to
any such Excluded Collateral Property that (a) Administrative Agent has received
environmental assessments of such Excluded Collateral Property satisfactory to
Administrative Agent in its sole discretion and (b) any remedial action deemed
necessary by Administrative Agent in its sole discretion with respect to such
Excluded Collateral Property has been taken or reserves have been established
acceptable to Administrative Agent in its sole discretion. Until such notice
with respect to any Excluded Collateral Property, the representations in
Sections 5.08, 5.09, 5.18, 5.19, 5.20, 5.21, 5.22, 5.23, 5.24, 5.25, 5.26, and
5.28, the covenants set forth in Sections 6.06, 6.12, 6.13, 6.14(c), 6.14(d),
6.15, 6.16, 6.17, 6.18, 6.19, 6.20, 6.21, 6.22, 6.23, 7.11, 7.12, 7.13, and
7.14, and the Default set forth in Section 8.01(l), in so far as they relate to
Collateral Properties, shall not apply to such Excluded Collateral Property.
"Existing Credit Agreement" means that certain Sixth Amended and Restated
Credit Agreement dated as of October 31, 2002, among Operating Company, Bank of
America, as agent, and the Lenders defined therein, as amended, restated, or
modified from time to time.
"Federal Funds Rate" means, for any day, the rate per annum equal to the
weighted average of the rates on overnight Federal funds transactions with
members of the Federal Reserve System arranged by Federal funds brokers on such
day, as published by the Federal Reserve Bank on the Business Day next
succeeding such day; provided that (a) if such day is not a Business Day, the
Federal Funds Rate for such day shall be such rate on such transactions on the
next preceding Business Day as so published on the next succeeding Business Day,
and (b) if no such rate is so published on such next succeeding Business Day,
the Federal Funds Rate for such day shall be the average rate (rounded upward,
if necessary, to a whole multiple of 1/100 of 1%) charged to Administrative
Agent on such day on such transactions as determined by Administrative Agent.
"Fee Letter" means the letter agreement, dated May 8, 2003, among Parent,
Banc of America Bridge LLC, and the Arranger.
"FF&E" shall mean furniture, fixtures, and equipment.
Credit Agreement 8
"FF&E Reserves" means, with respect to any Collateral 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 Revenues of such
Collateral Property or Person for such period.
"Fixed Charges" means, for any Person, for any period, (a) Debt Service,
plus (b) Restricted Payments with respect to preferred stock or other preferred
equity interests issued by such Person.
"Foreign Lender" has the meaning specified in Section 10.15(a)(i).
"Franchise Agreements" means each franchise or similar agreement entered
into by and between an Operating Lessee and each Franchisor pursuant to which
such Operating Lessee is permitted to operate the applicable Collateral Property
under the "flag" or other trade name that is the subject thereof, as the same
may be amended, restated, replaced, supplemented, or otherwise modified in
accordance with the terms of this Agreement, and "Franchise Agreement" means any
one of the Franchise Agreements.
"Franchisors" means each franchisor of each Collateral Property as set
forth on Schedule 1.01 or such other entity selected as the franchisor of the
applicable Collateral Property in accordance with the terms of this Agreement,
and "Franchisor" means any one of the Franchisors.
"FRB" means the Board of Governors of the Federal Reserve System of the
United States.
"GAAP" means generally accepted accounting principles in the United States
set forth in the opinions and pronouncements of the Accounting Principles Board
and the American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board or such other
principles as may be approved by a significant segment of the accounting
profession in the United States, that are applicable to the circumstances as of
the date of determination, consistently applied.
"Governmental Authority" means any nation or government, any state or other
political subdivision thereof, any agency, authority, instrumentality,
regulatory body, court, administrative tribunal, central bank, or other entity
exercising executive, legislative, judicial, taxing, regulatory, or
administrative powers or functions of or pertaining to government.
"Gross Revenues" means, for any Property or Person, all revenues and
receipts of every kind derived from operating such Property or all Properties
owned by such Person, as the case may be, and parts thereof, including, but not
limited to: income (from both cash and credit transactions), before commissions
and discounts for prompt or cash payments, from rentals or sales of rooms,
stores, offices, meeting space, exhibit space, or sales space of every kind;
license, lease, and concession fees and rentals (not including gross receipts of
licensees, lessees, and concessionaires); net income from vending machines;
health club membership fees; food and beverage sales; sales of merchandise
(other than proceeds from the sale of FF&E no longer necessary to the operation
of such Property or Properties); service charges, to the extent not distributed
to the employees at such Property or Properties as, or in lieu of, gratuities;
and proceeds, if any, from business interruption or other loss of income
insurance; provided, however, that Gross Revenues shall not include the
following: gratuities to employees of such Property or Properties; federal,
state, or municipal excise, sales, use, or similar taxes collected directly from
tenants, patrons, or guests or included as part of the sales price of any goods
or services; insurance proceeds (other than proceeds from business interruption
or other loss of income insurance); condemnation proceeds; or any proceeds from
any sale of such Property or Properties.
"Ground Leases" means, collectively, that certain (a) Ground Lease dated
November 30, 1987 between Commonwealth Trust Company, trustee for the Chopin
Trust and RFP Group, Inc., the terms of
Credit Agreement 9
which were amended and recorded by that certain Memorandum and Amendment to
Ground Lease Agreement dated as of June 20, 1988 and recorded in Book 730, Page
289 of the Office of the Recorder of Deeds for New Castle County, Delaware,
between Commonwealth Trust Company, trustee for the Chopin Trust and RFP Group,
Inc. and (b) Lease between Xxxxxxx Masonic Lodge No. 951, F. & A.M. by and
through its Board of Trustees and its Building Committee, as Lessor, and West,
Inc. d/b/a/ Holiday Inn Southwest, as Lessee which was recorded at Book 5039,
Page 873 in the Office of the Clerk of the County Court of Jefferson County,
Kentucky being the same leasehold estate which was acquired by LVSW Partners,
LP, a Tennessee limited partnership, from West, Inc. by Assignment of Lease
dated November 27, 1984 and recorded in Deed Book 5463, page 861 in the
aforesaid clerk's office, which was further assigned to Operating Company by
Assignment of Lease dated August 5, 1993 and recorded in Book 6345, Page 085 in
the same clerk's office, and "Ground Lease" means either one of the Ground
Leases.
"Guarantors" means, collectively, Parent, Acquisition Sub, and CNL Rose GP
Corp., and "Guarantor" means either one of the Guarantors.
"Guaranty" means the Guaranty Agreement made by Guarantors in favor of
Administrative Agent, for the benefit of Lenders.
"Guarantee" means, as to any Person, any (a) any obligation, contingent or
otherwise, of such Person guaranteeing or having the economic effect of
guaranteeing any Indebtedness or other obligation payable or performable by
another Person (the "primary obligor" ) in any manner, whether directly or
indirectly, and including any obligation of such Person, direct or indirect, (i)
to purchase or pay (or advance or supply funds for the purchase or payment of)
such Indebtedness or other obligation, (ii) to purchase or lease property,
securities, or services for the purpose of assuring the obligee in respect of
such Indebtedness or other obligation of the payment or performance of such
Indebtedness or other obligation, (iii) to maintain working capital, equity
capital, or any other financial statement condition or liquidity or level of
income or cash flow of the primary obligor so as to enable the primary obligor
to pay such Indebtedness or other obligation, or (iv) entered into for the
purpose of assuring in any other manner the obligee in respect of such
Indebtedness or other obligation of the payment or performance thereof or to
protect such obligee against loss in respect thereof (in whole or in part), or
(b) any Lien on any assets of such Person securing any Indebtedness or other
obligation of any other Person, whether or not such Indebtedness or other
obligation is assumed by such Person. The amount of any Guarantee shall be
deemed to be an amount equal to the stated or determinable amount of the related
primary obligation, or portion thereof, in respect of which such Guarantee is
made or, if not stated or determinable, the maximum reasonably anticipated
liability in respect thereof as determined by the guaranteeing Person in good
faith. The term "Guarantee" as a verb has a corresponding meaning.
"Hazardous Material" means any substance, whether solid, liquid, or
gaseous: which is listed, defined, or regulated as a " hazardous substance,"
"hazardous waste," "pollutants," or "solid waste," or otherwise classified as
hazardous or toxic, in or pursuant to any Environmental Requirement; or which is
or contains infectious or medical wastes, asbestos, asbestos containing
materials, radon, any polychlorinated biphenyl, urea formaldehyde foam
insulation, explosive or radioactive material, or motor fuel, or other petroleum
hydrocarbons, or petroleum distillates; or which causes or poses a threat to
cause a contamination or nuisance on any Property or any adjacent property or a
hazard to the environment or to the health or safety of persons on any Property.
"Improvements" means all on-site and off-site improvements to the
Collateral Properties, together with all fixtures, tenant improvements, and
appurtenances now or later to be located on the Collateral Properties and/or in
such improvements.
Credit Agreement 10
"Indebtedness" means, as to any Person at a particular time, without
duplication, all of the following, whether or not included as indebtedness or
liabilities in accordance with GAAP:
(a) all obligations of such Person for borrowed money and all
obligations of such Person evidenced by bonds, debentures, notes, loan
agreements, or other similar instruments;
(b) all direct or contingent obligations of such Person arising
under letters of credit (including standby and commercial), bankers'
acceptances, bank guaranties, surety bonds, and similar instruments;
(c) net obligations of such Person under any Swap Contract;
(d) all obligations of such Person to pay the deferred purchase
price of property or services (other than trade accounts payable in the
ordinary course of business);
(e) indebtedness (excluding prepaid interest thereon) secured by a
Lien on property owned or being purchased by such Person (including
indebtedness arising under conditional sales or other title retention
agreements), whether or not such indebtedness shall have been assumed by
such Person or is limited in recourse;
(f) capital leases and Synthetic Lease Obligations; and
(g) all Guarantees of such Person in respect of any of the
foregoing.
For all purposes hereof, the Indebtedness of any Person shall include such
Person's Share of the Indebtedness of any partnership or joint venture (other
than a Subsidiary of such Person or a joint venture that is itself a corporation
or limited liability company) in which such Person is a general partner or a
joint venturer. The amount of any net obligation under any Swap Contract on any
date shall be deemed to be the Swap Termination Value thereof as of such date.
The amount of any capital lease or Synthetic Lease Obligation as of any date
shall be deemed to be the amount of Attributable Indebtedness in respect thereof
as of such date.
"Indemnified Liabilities" has the meaning specified in Section 10.05.
"Indemnitees" has the meaning specified in Section 10.05.
"Insurance Proceeds" has the meaning specified in Section 6.18(b).
"Intangible Assets" means assets that are considered to be intangible
assets under GAAP, including customer lists, goodwill, computer software,
copyrights, trade names, trademarks, patents, franchises, licenses, unamortized
deferred charges, unamortized debt discount, and capitalized research and
development costs.
"Interest Payment Date" means: (a) as to any Eurodollar Rate Loan, the last
day of each Interest Period applicable to such Loan and the Maturity Date; and
(b) as to any Base Rate Loan, the last Business Day of each month during the
term hereof and the Maturity Date.
"Interest Period" means, as to each Eurodollar Rate Loan, the period
commencing on the date such Eurodollar Rate Loan is disbursed or converted to or
continued as a Eurodollar Rate Loan and ending on the date one month thereafter;
provided that:
Credit Agreement 11
(i) any Interest Period that would otherwise end on a day that is
not a Business Day shall be extended to the next succeeding Business Day
unless such Business Day falls in another calendar month, in which case
such Interest Period shall end on the next preceding Business Day;
(ii) any Interest Period that begins on the last Business Day of a
calendar month (or on a day for which there is no numerically corresponding
day in the calendar month at the end of such Interest Period) shall end on
the last Business Day of the calendar month at the end of such Interest
Period; and
(iii) no Interest Period shall extend beyond the Maturity Date.
"Investment" means, as to any Person, any direct or indirect acquisition or
investment by such Person, whether by means of (a) the purchase or other
acquisition of capital stock or other securities of another Person, (b) a loan,
advance, or capital contribution to, Guarantee or assumption of debt of, or
purchase, or other acquisition of any other debt or equity participation or
interest in, another Person, including any partnership or joint venture interest
in such other Person, or (c) the purchase or other acquisition (in one
transaction or a series of transactions) of assets of another Person that
constitute a business unit. For purposes of covenant compliance, the amount of
any Investment shall be the amount actually invested, without adjustment for
subsequent increases or decreases in the value of such Investment.
"IP Rights" has the meaning set forth in Section 5.18.
"IRS" means the United States Internal Revenue Service.
"Laws" means, collectively, all international, foreign, Federal, state and
local statutes, treaties, rules, guidelines, regulations, ordinances, codes, and
administrative or judicial precedents or authorities, including the
interpretation or administration thereof by any Governmental Authority charged
with the enforcement, interpretation or administration thereof, and all
applicable administrative orders, directed duties, requests, licenses,
authorizations, and permits of, and agreements with, any Governmental Authority,
in each case whether or not having the force of law.
"Lender" and "Lenders" have the meanings specified in the introductory
paragraph hereto.
"Lending Office" means, as to any Lender, the office or offices of such
Lender described as such in such Lender's Administrative Questionnaire, or such
other office or offices as a Lender may from time to time notify Borrowers and
Administrative Agent.
"Lien" means any mortgage, pledge, hypothecation, assignment, deposit
arrangement, monetary encumbrance, lien (statutory or other), charge, or
preference, priority, or other security interest or preferential arrangement of
any kind or nature whatsoever (including any conditional sale or other title
retention agreement, and any financing lease having substantially the same
economic effect as any of the foregoing).
"Loan" means an extension of credit by a Lender to Borrowers under Article
II.
"Loan Documents" means this Agreement, each Note, the Mortgages, the Fee
Letter, the Guaranty, and such other documents evidencing, securing, or
pertaining to the Loans.
Credit Agreement 12
"Loan Notice" means a notice of (a) a Borrowing, (b) a conversion of Loans
from one Type to the other, or (c) a continuation of Eurodollar Rate Loans,
pursuant to Section 2.02(a), which, if in writing, shall be substantially in the
form of Exhibit A.
"Loan Parties" means, collectively, Borrowers, each Pledgor, and each
Guarantor.
"Loan to Value Ratio" means, as of any date of determination, the ratio of
(a) the Outstanding Amount as of such date of determination, to (b) the
Aggregate Collateral Value as of such date of determination.
"Management Agreements" means each management agreement entered into by and
between an Operating Lessee and each Manager, pursuant to which each Manager is
to provide management and other services with respect to each applicable
Collateral Property, as the same may be amended, restated, replaced,
supplemented, or otherwise modified in accordance with the terms of this
Agreement, and "Management Agreement" means any one of the Management
Agreements.
"Management Fee Reserves" means, with respect to any Collateral Property or
Person for any period, a reserve for management fees equal to the greater of (a)
any actual management fees or (b) an assumed reserve of three percent (3%) of
Gross Revenues of such Collateral Property or Person for such period.
"Managers" means each manager of each Collateral Property as set forth on
Schedule 1.01 or such other entity selected as the manager of the applicable
Collateral Property in accordance with the terms of this Agreement, and
"Manager" means any one of the Managers.
"Material Adverse Effect" means: (a) a material adverse change in, or a
material adverse effect upon, the operations, business, properties, liabilities
(actual or contingent), condition (financial or otherwise), or prospects of
Parent, the RFS Companies, taken as a whole, or any Borrower; (b) a material
impairment of the ability of any Loan Party to perform its obligations under any
Loan Document to which it is a party; or (c) a material adverse effect upon the
legality, validity, binding effect, or enforceability against any Loan Party of
any Loan Document to which it is a party.
"Material Property Event" means, with respect to any Collateral Property,
the occurrence of any event or circumstance that could result in (a) a material
adverse effect with respect to the financial condition or the operations of the
Collateral Properties, taken as a whole, or (b) material adverse effect on the
value or ownership of the Collateral Properties, taken as a whole.
"Maturity Date" means (a) with respect to the Tranche A Loans, January 10,
2004 and (b) with respect to the Tranche B Loans, July 10, 2005.
"Merger Agreement" means that certain Agreement by and among Parent,
Operating Company, RFS Hotel Investors, Inc., CNL Rose Acquisition OP, LP, and
CNL Rose Acquisition Corp. dated as of May 8, 2003.
"Merger Transaction Documents" means the Merger Agreement and each other
document executed and delivered in connection with the Merger Transactions.
"Merger Transactions" means the mergers and other transactions contemplated
by the Merger Agreement.
Credit Agreement 13
"Mortgages" means each Mortgage, Assignment of Rents and Leases, and
Security Agreement, or Deed of Trust, Assignment of Rents and Leases, and
Security Agreement, or Deed to Secure Debt, Assignment of Rents and Leases, and
Security Agreement, as applicable, dated July 10, 2003, granted by a Borrower to
Administrative Agent, for the benefit of the Lenders, securing repayment and
performance of the Obligations, as amended, modified, supplemented, restated,
and replaced from time to time.
"Multiemployer Plan" means any employee benefit plan of the type described
in Section 4001(a)(3) of ERISA, to which either Borrower or any ERISA Affiliate
makes or is obligated to make contributions, or during the preceding five plan
years, has made or been obligated to make contributions.
"Net Cash Proceeds" means, with respect to a Disposition, the issuance of
any stock or other equity-linked securities, or the issuance of any bonds,
debentures, notes, or other Indebtedness by any Person, the amount of cash
received by such Person in connection with such transaction after deducting
therefrom the aggregate, without duplication, of the following amounts to the
extent properly attributable to such transaction: (a) reasonable brokerage
commissions, survey fees, title insurance costs and premiums, attorneys' fees,
finder's fees, financial advisory fees, due diligence fees, accounting fees,
underwriting fees, investment banking fees, and other similar commissions and
fees and expenses and disbursements of any of the foregoing, in each case to the
extent paid or payable by such Person; (b) printing and related expenses of
filing and recording or registration fees or charges or similar fees or charges
paid by such Person; (c) fees and taxes paid or payable by such Person to any
Governmental Authority as a result of such transaction; and (d) in the case of
the Disposition of a Property or refinancing of Indebtedness secured by Liens in
a Property, the amount of Indebtedness repaid by such Person secured by such
Liens.
"Net Proceeds" has the meaning specified in Section 6.18(b).
"Net Proceeds Deficiency" has the meaning specified in Section 6.18(b)(vi).
"Note" means a promissory note made by Borrowers in favor of a Lender
evidencing Loans made by such Lender, substantially in the form of Exhibit B.
"Obligations" means all advances to, and debts, liabilities, obligations,
covenants, and duties of, any Loan Party arising under any Loan Document or
otherwise with respect to any Loan, whether direct or indirect (including those
acquired by assumption), absolute or contingent, due or to become due, now
existing or hereafter arising and including interest and fees that accrue after
the commencement by or against any Loan Party or any Affiliate thereof of any
proceeding under any Debtor Relief Laws naming such Person as the debtor in such
proceeding, regardless of whether such interest and fees are allowed claims in
such proceeding; provided that all references to the "Obligations" in the
Mortgages, Guaranty, Pledge Agreements, and other security agreements or pledge
agreements delivered to Administrative Agent to create or evidence Liens
securing the Obligations shall, in addition to the foregoing, include all
present and future indebtedness, liabilities, and obligations now or hereafter
owed to any Lender or any Affiliate of any Lender arising from, by virtue of, or
pursuant to any Swap Contract.
"On" or "on", when used with respect to any Property or any property
adjacent to such Property, means "on, in, under, above, or about."
"Operating Company" has the meaning specified in the introductory paragraph
hereto.
"Operating Leases" means each operating lease entered into by and between
an Operating Lessee and a Borrower, which govern the operation of each
applicable Collateral Property, as the same may be
Credit Agreement 14
amended, restated, replaced, supplemented, or otherwise modified from time to
time, and "Operating Lease" means any one of the Operating Agreements.
"Operating Lessees" means each operating lessee of each Collateral Property
as set forth on Schedule 1.01 or such other entity selected as the operating
lessee of the applicable Collateral Property in accordance with the terms of
this Agreement, and "Operating Lessee" means any one of the Operating Lessees.
"Organization Documents" means: (a) with respect to any corporation, the
certificate or articles of incorporation and the bylaws (or equivalent or
comparable constitutive documents with respect to any non-U.S. jurisdiction);
(b) with respect to any limited liability company, the certificate or articles
of formation or organization and operating agreement; and (c) with respect to
any partnership, joint venture, trust or other form of business entity, the
partnership, joint venture or other applicable agreement of formation or
organization and any agreement, instrument, filing or notice with respect
thereto filed in connection with its formation or organization with the
applicable Governmental Authority in the jurisdiction of its formation or
organization and, if applicable, any certificate or articles of formation or
organization of such entity.
"Outstanding Amount" means the aggregate outstanding principal amount of
the Loans after giving effect to any borrowings and prepayments or repayments of
Loans occurring on such date.
"Parent" has the meaning specified in the introductory paragraph hereto.
"Participant" has the meaning specified in Section 10.07(d).
"PBGC" means the Pension Benefit Guaranty Corporation.
"Pension Plan" means any "employee pension benefit plan" (as such term is
defined in Section 3(2) of ERISA), other than a Multiemployer Plan, that is
subject to Title IV of ERISA and is sponsored or maintained by either Borrower
or any ERISA Affiliate or to which either Borrower or any ERISA Affiliate
contributes or has an obligation to contribute, or in the case of a multiple
employer or other plan described in Section 4064(a) of ERISA, has made
contributions at any time during the immediately preceding five plan years.
"Person" means any natural person, corporation, limited liability company,
trust, joint venture, association, company, partnership, Governmental Authority,
or other entity.
"Personal Property" has the meaning set forth in the granting clause of the
Mortgages.
"Plan" means any "employee benefit plan" (as such term is defined in
Section 3(3) of ERISA) established by a Borrower or, with respect to any such
plan that is subject to Section 412 of the Code or Title IV of ERISA, any ERISA
Affiliate.
"Plans" means the plans and specifications for the Collateral Properties,
including existing or proposed Improvements, and all modifications thereof and
additions thereto that are included as part of the Plans in accordance with the
terms of this Agreement.
"Pledge Agreements" means those certain Pledge and Security Agreements
executed by Parent, Acquisition Sub, CNL Rose GP Corp., and Operating Company
each dated as of the date hereof.
"Pledgors" means each Person executing a Pledge Agreement or Mortgage.
Credit Agreement 15
"Policies" has the meaning specified in Section 6.07(b).
"Property" means all of the right, title, and interest of Parent or any RFS
Company in and to land, improvements, and fixtures, including leases of real
property.
"Pro Rata Share" means, with respect to each Lender at any time, a fraction
(expressed as a percentage, carried out to the ninth decimal place), the
numerator of which is the amount of the Commitment of such Lender at such time
and the denominator of which is the amount of the Aggregate Commitments at such
time; provided that if the commitment of each Lender to make Loans has been
terminated pursuant to Section 8.02 or otherwise, then the Pro Rata Share of
each Lender shall be determined based on the proportion (stated as a percentage)
that the sum of the outstanding principal amount of Loans owed to such Lender
bears to the Outstanding Amount. The initial Pro Rata Share of each Lender is
set forth opposite the name of such Lender on Schedule 2.01 or in the Assignment
and Assumption pursuant to which such Lender becomes a party hereto, as
applicable.
"Qualified Manager" means a Manager or a reputable and experienced
professional management organization (a) which manages, together with its
affiliates, hotel properties comparable to any relevant Collateral Property and
(b) approved by Administrative Agent, which approval shall not have been
unreasonably withheld.
"REAs" means each construction, operation and reciprocal easement
agreements or similar agreements (including any separate agreements or other
agreements between a Borrower and one or more other parties to any REA with
respect to such REA) affecting any Collateral Property or portion thereof, and
"REA" means any one of the REAs.
"REIT" means a "real estate investment trust" for purposes of the Code.
"Register" has the meaning specified in Section 10.07(c).
"Release Date" means the earlier of the following two dates: (i) the date
on which the Obligations have been paid in full and the Mortgages have been
released; or (ii) the date on which the liens of the Mortgages are fully and
finally foreclosed or a conveyance by deed in lieu of such foreclosure is fully
and finally effective and possession of the Collateral Properties has been given
to and accepted by the purchaser or Administrative Agent free of occupancy and
claims to occupancy by Borrowers and their heirs, devisees, representatives,
successors, and assigns; provided that, if such payment, performance, release,
foreclosure, or conveyance is challenged, in bankruptcy proceedings or
otherwise, the Release Date shall be deemed not to have occurred until such
challenge is validly released, dismissed with prejudice, or otherwise barred by
Law from further assertion.
"Reportable Event" means any of the events set forth in Section 4043(c) of
ERISA, other than events for which the thirty (30) day notice period has been
waived.
"Required Lenders" means, as of any date of determination, Lenders having
at least 66-2/3% of the Aggregate Commitments or, if the commitment of each
Lender to make Loans has been terminated pursuant to Section 8.02 or otherwise,
Lenders holding in the aggregate at least 66-2/3% of the Total Outstandings;
provided that the Commitment of, and the portion of the Total Outstandings held
or deemed held by, any Defaulting Lender shall be excluded for purposes of
making a determination of Required Lenders.
"Responsible Officer" means the chief executive officer, president, chief
financial officer, treasurer, or assistant treasurer of a Loan Party. Any
document delivered hereunder that is signed by a
Credit Agreement 16
Responsible Officer of a Loan Party shall be conclusively presumed to have been
authorized by all necessary corporate, partnership, and/or other action on the
part of such Loan Party and such Responsible Officer shall be conclusively
presumed to have acted on behalf of such Loan Party.
"Restoration" means, following the occurrence of a Casualty or a
Condemnation which is of a type necessitating the repair of a Collateral
Property, the completion of the repair and restoration of the Collateral
Property as nearly as possible to the condition the Collateral Property was in
immediately prior to such Casualty or Condemnation, with such alterations as may
be reasonably approved by Administrative Agent.
"Restoration Consultant" has the meaning specified in Section 6.18(b)(iii).
"Restoration Retainage" has the meaning specified in Section 6.18(b)(iv).
"Restricted Payment" means, for any Person, any dividend or other
distribution (whether in cash, securities or other property) with respect to any
capital stock or other equity interest of such Person, or any payment (whether
in cash, securities, or other property), including any sinking fund or similar
deposit, on account of the purchase, redemption, retirement, acquisition,
cancellation, or termination of any such capital stock or other equity interest
or of any option, warrant or other right to acquire any such capital stock or
other equity interest.
"RFS Companies" means Acquisition Sub and its Subsidiaries, and "RFS
Company" means any one of the RFS Companies.
"S&P" means Standard & Poor's Ratings Services, a division of The
XxXxxx-Xxxx Companies, Inc. and any successor thereto.
"SEC" means the Securities and Exchange Commission, or any Governmental
Authority succeeding to any of its principal functions.
"Senior Notes" means those certain 9.75% Series B Senior Notes issued by
Operating Company.
"Share" means, for any Person, such Person's share of the assets,
liabilities, revenues, income, losses, or expenses of another Person (other than
a Subsidiary) based upon such Person's percentage ownership of the equity of
such other Person.
"Shareholders' Equity" means, as of any date of determination, with respect
to any Person, consolidated shareholders' equity of such Person as of that date
determined in accordance with GAAP.
"Solvent" means, as to a Person, that (a) the aggregate fair market value
of its assets exceeds its liabilities, (b) it has sufficient cash flow to enable
it to pay its liabilities as they mature, and (c) it does not have unreasonably
small capital to conduct its businesses.
"Subsidiary" of a Person means a corporation, partnership, joint venture,
limited liability company, or other business entity of which a majority of the
shares of securities or other interests having ordinary voting power for the
election of directors or other governing body (other than securities or
interests having such power only by reason of the happening of a contingency)
are at the time beneficially owned, or the management of which is otherwise
controlled, directly, or indirectly through one or more intermediaries, or both,
by such Person. Unless otherwise specified, all references herein to a
"Subsidiary" or to "Subsidiaries" shall refer to a Subsidiary or Subsidiaries of
Acquisition Sub.
Credit Agreement 17
"Survey" means a survey prepared in accordance with Exhibit E.
"Swap Contract" means (a) any and all rate swap transactions, basis swaps,
credit derivative transactions, forward rate transactions, commodity swaps,
commodity options, forward commodity contracts, equity or equity index swaps, or
options, bond or bond price or bond index swaps, or options or forward bond or
forward bond price or forward bond index transactions, interest rate options,
forward foreign exchange transactions, cap transactions, floor transactions,
collar transactions, currency swap transactions, cross-currency rate swap
transactions, currency options, spot contracts, or any other similar
transactions or any combination of any of the foregoing (including any options
to enter into any of the foregoing), whether or not any such transaction is
governed by or subject to any master agreement, and (b) any and all transactions
of any kind, and the related confirmations, which are subject to the terms and
conditions of, or governed by, any form of master agreement published by the
International Swaps and Derivatives Association, Inc., any International Foreign
Exchange Master Agreement, or any other master agreement (any such master
agreement, together with any related schedules, a "Master Agreement"), including
any such obligations or liabilities under any Master Agreement.
"Swap Termination Value " means, in respect of any one or more Swap
Contracts, after taking into account the effect of any legally enforceable
netting agreement relating to such Swap Contracts, (a) for any date on or after
the date such Swap Contracts have been closed out and termination value(s)
determined in accordance therewith, such termination value(s), and (b) for any
date prior to the date referenced in clause (a), the amount(s) determined as the
xxxx-to-market value(s) for such Swap Contracts, as determined based upon one or
more mid-market or other readily available quotations provided by any recognized
dealer in such Swap Contracts (which may include a Lender or any Affiliate of a
Lender).
"Synthetic Lease Obligation" means the monetary obligation of a Person
under (a) a so-called synthetic, off-balance sheet or tax retention lease, or
(b) an agreement for the use or possession of property creating obligations that
do not appear on the balance sheet of such Person but which, upon the insolvency
or bankruptcy of such Person, would be characterized as the indebtedness of such
Person (without regard to accounting treatment).
"Tenant Lease" has the meaning specified in Section 7.12.
"Threshold Amount" means $10,000,000.
"Title Insurance" means the loan policy or policies of title insurance
issued to Administrative Agent for the benefit of Lenders by the Title Insurer,
in an amount equal to the maximum principal amount of the Aggregate Commitments,
insuring the validity and priority of the Mortgages encumbering the Collateral
Properties and Improvements described in the Mortgages for the benefit of
Administrative Agent and Lenders.
"Title Insurer" means First American Title Insurance Company.
"Total Outstandings" means the aggregate Outstanding Amount of all Loans.
"Tranche A Availability Period" means the period from and including the
Closing Date to the earliest of (a) the date of termination of the Aggregate
Commitments pursuant to Section 2.04, (b) the date of termination of the
commitment of each Lender to make Loans pursuant to Section 8.02, and (c)
November 7, 2003.
"Tranche A Loans" means Loans made during the Tranche A Availability
Period.
Credit Agreement 18
"Tranche A Sublimit" means an amount equal to $250,000,000.
"Tranche B Availability Period" means the period from and including the
date on which Lenders have made Loans equal to the full amount of the Tranche A
Sublimit to the earliest of (a) the date of termination of the Aggregate
Commitments pursuant to Section 2.04, (b) the date of termination of the
commitment of each Lender to make Loans pursuant to Section 8.02, and (c)
November 7, 2003.
"Tranche B Loans" means Loans made during the Tranche B Availability
Period.
"Tranche B Sublimit" means an amount equal to $70,000,000.
"Transaction Documents" means any and all documents evidencing the Merger
Transactions, including, without limitation, the Merger Agreement, and each
other executed and delivered in connection with the Merger Transactions.
"Type" means, with respect to a Loan, its character as a Base Rate Loan or
a Eurodollar Rate Loan.
"Unfunded Pension Liability" means the excess of a Pension Plan's benefit
liabilities under Section 4001(a)(16) of ERISA, over the current value of that
Pension Plan's assets, determined in accordance with the assumptions used for
funding the Pension Plan pursuant to Section 412 of the Code for the applicable
plan year.
"United States" and "U.S. " mean the United States of America.
Other Interpretive Provisions. With reference to this Agreement and each
other Loan Document, unless otherwise specified herein or in such other Loan
Document:
(a) The meanings of defined terms are equally applicable to the singular
and plural forms of the defined terms.
(b) (i) The words "herein," " hereto," "hereof," and "hereunder" and
words of similar import when used in any Loan Document shall refer to such Loan
Document as a whole and not to any particular provision thereof.
(ii) Article, Section, Exhibit and Schedule references are to the Loan
Document in which such reference appears.
(iii) The term "including" is by way of example and not limitation.
(iv) The term "documents" includes any and all instruments, documents,
agreements, certificates, notices, reports, financial statements and other
writings, however evidenced, whether in physical or electronic form.
(c) In the computation of periods of time from a specified date to a
later specified date, the word "from" means "from and including ;" the words
"to" and "until" each mean "to but excluding;" and the word "through" means "to
and including."
(d) Section headings herein and in the other Loan Documents are included
for convenience of reference only and shall not affect the interpretation of
this Agreement or any other Loan Document.
Credit Agreement 19
Accounting Terms. (a) All accounting terms not specifically or completely
defined herein shall be construed in conformity with, and all financial data
(including financial ratios and other financial calculations) required to be
submitted pursuant to this Agreement shall be prepared in conformity with, GAAP
applied on a consistent basis, as in effect from time to time, applied in a
manner consistent with that used in preparing the Audited Financial Statements,
except as otherwise specifically prescribed herein.
(b) If at any time any change in GAAP would affect the computation of any
financial ratio or requirement set forth in any Loan Document, and Parent,
Operating Company, or the Required Lenders shall so request, Administrative
Agent, Lenders, Parent, and Operating Company shall negotiate in good faith to
amend such ratio or requirement to preserve the original intent thereof in light
of such change in GAAP (subject to the approval of the Required Lenders);
provided that, until so amended, (i) such ratio or requirement shall continue to
be computed in accordance with GAAP prior to such change therein and (ii) Parent
and Operating Company shall provide to Administrative Agent and Lenders
financial statements and other documents required under this Agreement or as
reasonably requested hereunder setting forth a reconciliation between
calculations of such ratio or requirement made before and after giving effect to
such change in GAAP.
Rounding. Any financial ratios required to be maintained by Parent or
Operating Company pursuant to this Agreement shall be calculated by dividing the
appropriate component by the other component, carrying the result to one place
more than the number of places by which such ratio is expressed herein and
rounding the result up or down to the nearest number (with a rounding-up if
there is no nearest number).
References to Agreements and Laws. Unless otherwise expressly provided
herein, (a) references to Organization Documents, agreements (including the Loan
Documents) and other contractual instruments shall be deemed to include all
subsequent amendments, restatements, extensions, supplements and other
modifications thereto, but only to the extent that such amendments,
restatements, extensions, supplements and other modifications are not prohibited
by any Loan Document; and (b) references to any Law shall include all statutory
and regulatory provisions consolidating, amending, replacing, supplementing or
interpreting such Law.
Times of Day. Unless otherwise specified, all references herein to times of
day shall be references to Eastern time (daylight or standard, as applicable).
THE COMMITMENTS
Loans. Subject to the terms and conditions set forth herein, each Lender
severally agrees to make (a) Loans to Borrowers in multiple advances, on any
Business Day during the Tranche A Availability Period, in an aggregate amount
not to exceed at any time outstanding the Tranche A Sublimit, and (b) Loans to
Borrowers in multiple advances, on any Business Day during the Tranche B
Availability Period, in an aggregate amount not to exceed at any time
outstanding the Tranche B Sublimit; provided, however, that after giving effect
to any Borrowing, (i) the Total Outstandings shall not exceed the Aggregate
Commitments, and (ii) the aggregate Outstanding Amount of the Loans of any
Lender shall not exceed such Lender's Commitment. If all or a portion of the
Outstanding Amount is paid or prepaid, then the amount so paid or prepaid may
not be reborrowed.
Credit Agreement 20
Borrowings, Conversions, and Continuations of Loans.
(a) Each Borrowing, each conversion of Loans from one Type to the other,
and each continuation of Eurodollar Rate Loans shall be made upon Borrowers'
irrevocable notice to Administrative Agent, which may be given by telephone.
Each such notice must be received by Administrative Agent not later than 11:00
a.m. (i) three (3) Business Days prior to the requested date of any Borrowing
of, conversion to, or continuation of Eurodollar Rate Loans or of any conversion
of Eurodollar Rate Loans to Base Rate Loans, and (ii) on the requested date of
any Borrowing of Base Rate Loans. Each telephonic notice by Borrowers pursuant
to this Section 2.02(a) must be confirmed promptly by delivery to Administrative
Agent of a written Loan Notice, appropriately completed and signed by a
Responsible Officer of Borrowers. Each Borrowing of, conversion to, or
continuation of Eurodollar Rate Loans shall be in a principal amount of
$5,000,000 or a whole multiple of $1,000,000 in excess thereof. Each Borrowing
of or conversion to Base Rate Loans shall be in a principal amount of $500,000
or a whole multiple of $100,000 in excess thereof. Each Loan Notice (whether
telephonic or written) shall specify (i) whether Borrowers are requesting a
Borrowing, a conversion of Loans from one Type to the other, or a continuation
of Eurodollar Rate Loans, (ii) the requested date of the Borrowing, conversion,
or continuation, as the case may be (which shall be a Business Day), (iii) the
principal amount of Loans to be borrowed, converted, or continued, and (iv) the
Type of Loans to be borrowed or to which existing Loans are to be converted. If
Borrowers fail to specify a Type of Loan in a Loan Notice or if Borrowers fail
to give a timely notice requesting a conversion or continuation, then the
applicable Loans shall be made as, or converted to, Base Rate Loans. Any such
automatic conversion to Base Rate Loans shall be effective as of the last day of
the Interest Period then in effect with respect to the applicable Eurodollar
Rate Loans.
(b) Following receipt of a Loan Notice, Administrative Agent shall
promptly notify each Lender of the amount of its Pro Rata Share of the
applicable Loans, and if no timely notice of a conversion or continuation is
provided by Borrowers, Administrative Agent shall notify each Lender of the
details of any automatic conversion to Base Rate Loans described in the
preceding subsection. In the case of a Borrowing, each Lender shall make the
amount of its Loan available to Administrative Agent in immediately available
funds at Administrative Agent's Office not later than 1:00 p.m. on the Business
Day specified in the applicable Loan Notice. Upon satisfaction of the applicable
conditions set forth in Section 4.02 (and, if such Borrowing is the initial
Borrowing, Sections 4.01 and 4.03), Administrative Agent shall make all funds so
received available to Borrowers in like funds as received by Administrative
Agent either by (i) crediting the account of Borrowers on the books of Bank of
America with the amount of such funds or (ii) wire transfer of such funds, in
each case in accordance with instructions provided to (and reasonably acceptable
to) Administrative Agent by Borrowers.
(c) Except as otherwise provided herein, a Eurodollar Rate Loan may be
continued or converted only on the last day of an Interest Period for such
Eurodollar Rate Loan. During the existence of a Default, no Loans may be
requested as, converted to, or continued as Eurodollar Rate Loans without the
consent of the Required Lenders.
(d) Administrative Agent shall promptly notify Borrowers and Lenders of
the interest rate applicable to any Interest Period for Eurodollar Rate Loans
upon determination of such interest rate. The determination of the Eurodollar
Rate by Administrative Agent shall be conclusive in the absence of manifest
error. At any time that Base Rate Loans are outstanding, Administrative Agent
shall notify Borrowers and Lenders of any change in Bank of America's prime rate
used in determining the Base Rate promptly following the public announcement of
such change.
Credit Agreement 21
(e) After giving effect to all Borrowings, all conversions of Loans from
one Type to the other, and all continuations of Loans as the same Type, there
shall not be more than five (5) Interest Periods in effect with respect to
Loans.
Prepayments.
(a) Borrowers may, upon notice to Administrative Agent, at any time or
from time to time voluntarily prepay Loans in whole or in part; provided that
(i) such notice must be received by Administrative Agent not later than 11:00
a.m. (A) three (3) Business Days prior to any date of prepayment of Eurodollar
Rate Loans and (B) on the date of prepayment of Base Rate Loans; (ii) any
prepayment of Eurodollar Rate Loans shall be in a principal amount of $5,000,000
or a whole multiple of $1,000,000 in excess thereof; (iii) any prepayment of
Base Rate Loans shall be in a principal amount of $500,000 or a whole multiple
of $100,000 in excess thereof or, in each case, if less, the entire principal
amount thereof then outstanding; and (iv) if any such prepayment of Loans is of
Tranche B Loans and occurs more than one hundred twenty (120) days after the
Closing Date but prior to the first anniversary of the Closing Date, then
Borrowers must pay to Administrative Agent for the benefit of Lenders a
prepayment penalty equal to two percent (2%) of such amount prepaid. Each such
notice shall specify the date and amount of such prepayment, the Type(s) of
Loans to be prepaid, and the amount of the prepayment penalty due, if any.
Administrative Agent will promptly notify each Lender of its receipt of each
such notice, and of the amount of such Lender's Pro Rata Share of such
prepayment. If such notice is given by Borrowers, Borrowers shall make such
prepayment and the payment amount specified in such notice shall be due and
payable on the date specified therein. Any prepayment of a Eurodollar Rate Loan
shall be accompanied by all accrued interest thereon, together with any
additional amounts required pursuant to Section 3.05. Each such prepayment shall
be applied to the Loans of Lenders in accordance with their respective Pro Rata
Shares.
(b) If for any reason the Total Outstandings at any time exceed the
Aggregate Commitments then in effect, Borrowers shall immediately prepay Loans
in an aggregate amount equal to such excess.
(c) Borrowers shall prepay the Loans by an amount equal to (i) one hundred
percent (100%) of the Net Cash Proceeds of any Disposition by Acquisition Sub,
Operating Company, or any Subsidiary of Operating Company, (ii) one hundred
percent (100%) of the Net Cash Proceeds from the issuance of any bonds,
debentures, notes, or other Indebtedness by Parent, Acquisition Sub, Operating
Company, or any Subsidiary of Operating Company, other than with respect to
Indebtedness referenced on Schedule 2.03, and (iii) one hundred percent (100%)
of the Net Cash Proceeds from the issuance of any stock or other equity-linked
securities issued by Parent, Acquisition Sub, Operating Company, or any
Subsidiary of Operating Company, at any time after the six (6) month anniversary
of the Closing Date or otherwise after an Event of Default has occurred and is
continuing, other than equity issuances referenced on Schedule 2.03. If any such
prepayment of Loans (other than a prepayment of Loans in connection with a
Disposition permitted by Section 7.05(f)) is of Tranche B Loans and occurs more
than one hundred twenty (120) days after the Closing Date but prior to the first
anniversary of the Closing Date, then Borrowers shall pay to Administrative
Agent for the benefit of Lenders a prepayment penalty equal to two percent (2%)
of such amount prepaid.
(d) All prepayments of principal of the Loans shall be applied first to
reduce the Outstanding Amount of the Tranche A Loans and then to reduce the
Outstanding Amount of the Tranche B Loans.
Termination or Reduction of Commitments.
(a) Borrowers may, upon notice to Administrative Agent, which notice shall
be irrevocable, terminate the Aggregate Commitments, or from time to time
permanently reduce the Aggregate
Credit Agreement 22
Commitments; provided that (i) any such notice shall be received by
Administrative Agent not later than 11:00 a.m. five (5) Business Days prior to
the date of termination or reduction, (ii) any such partial reduction shall be
in an aggregate amount of $10,000,000 or any whole multiple of $1,000,000 in
excess thereof, and (iii) Borrowers shall not terminate or reduce the Aggregate
Commitments if, after giving effect thereto and to any concurrent prepayments
hereunder, the Total Outstandings exceed the Aggregate Commitments.
Administrative Agent will promptly notify Lenders of any such notice of
termination or reduction of the Aggregate Commitments.
(b) If at any time while the Aggregate Commitments exceed the Outstanding
Amount, a CMBS Borrower is extended credit pursuant to a CMBS Facility, then the
Aggregate Commitments shall be permanently reduced by an amount equal to the
principal amount of any credit extended to such CMBS Borrower under such CMBS
Facility. If after such reduction the Total Outstandings would exceed the
Aggregate Commitments, then Borrowers shall prepay the Loans in accordance with
Section 2.03(b).
(c) Any reduction of the Aggregate Commitments pursuant to this Section
2.04 shall be applied to the Commitment of each Lender according to its Pro Rata
Share. All unused fees accrued until the effective date of any termination of
the Aggregate Commitments shall be paid on the effective date of such
termination.
Repayment of Loans. Borrowers shall repay to Lenders on the Maturity Date
the aggregate principal amount of Loans outstanding on such date.
Interest.
(a) Subject to the provisions of Section 2.06(b) below, (i) each
Eurodollar Rate Loan shall bear interest on the outstanding principal amount
thereof for each Interest Period at a rate per annum equal to the Eurodollar
Rate for such Interest Period plus the Applicable Margin; and (ii) each Base
Rate Loan shall bear interest on the outstanding principal amount thereof from
the applicable borrowing date at a rate per annum equal to the Base Rate plus
the Applicable Margin; provided that in no event shall the interest rate on the
Loans exceed the maximum rate allowed under applicable Laws.
(b) If any amount payable by Borrowers under any Loan Document is not paid
when due (without regard to any applicable grace periods), whether at stated
maturity, by acceleration or otherwise, such amount shall thereafter bear
interest at a fluctuating interest rate per annum at all times equal to the
Default Rate to the fullest extent permitted by applicable Laws. Furthermore,
while any Event of Default exists, Borrowers shall pay interest on the principal
amount of all outstanding Obligations hereunder at a fluctuating interest rate
per annum at all times equal to the Default Rate to the fullest extent permitted
by applicable Laws. Accrued and unpaid interest on past due amounts (including
interest on past due interest) shall be due and payable upon demand.
(c) Interest on each Loan shall be due and payable in arrears on each
Interest Payment Date applicable thereto and at such other times as may be
specified herein. Interest hereunder shall be due and payable in accordance with
the terms hereof before and after judgment, and before and after the
commencement of any proceeding under any Debtor Relief Law.
Fees.
(a) Utilization Fee. Borrowers shall jointly and severally pay to
Administrative Agent for the account of each Lender in accordance with its Pro
Rata Share, a utilization fee equal to three percent (3%) per annum times the
portion of the Total Outstandings, if any, on each day that exceeds fifty
percent
Credit Agreement 23
(50%) of the Aggregate Collateral Value for such day. The utilization fee shall
be due and payable on each Interest Payment Date, commencing with the first such
date to occur after the Closing Date, and on the Maturity Date, and shall be
calculated based upon the Aggregate Collateral Value set forth in the Compliance
Certificate most recently delivered pursuant to Section 6.02(b); provided that
if Parent and Borrowers fail to furnish to Administrative Agent any Compliance
Certificate on the date required pursuant to Section 6.02(b), and any
subsequently delivered Compliance Certificate evidences a decrease in the
Aggregate Collateral Value, then Borrowers shall pay to Administrative Agent, on
demand, an amount equal to the difference between the utilization fee actually
paid for any period and the utilization fee which should have been paid taking
into account the actual Aggregate Collateral Value.
(b) Other Fees.
(i) Borrowers shall pay to Arranger and Administrative Agent for
their own respective accounts fees in the amounts and at the times
specified in the Fee Letter. Such fees shall be fully earned when paid and
shall not be refundable for any reason whatsoever.
(ii) Borrowers shall pay to Lenders such fees as shall have been
separately agreed upon in writing in the amounts and at the times so
specified. Such fees shall be fully earned when paid and shall not be
refundable for any reason whatsoever.
Computation of Interest and Fees. All computations of interest for Base
Rate Loans when the Base Rate is determined by Bank of America's "prime rate"
shall be made on the basis of a year of 365 or 366 days, as the case may be, and
actual days elapsed. All other computations of fees and interest shall be made
on the basis of a 360-day year and actual days elapsed (which results in more
fees or interest, as applicable, being paid than if computed on the basis of a
365-day year). Interest shall accrue on each Loan for the day on which the Loan
is made, and shall not accrue on a Loan, or any portion thereof, for the day on
which the Loan or such portion is paid, provided that any Loan that is repaid on
the same day on which it is made shall, subject to Section 2.10(a), bear
interest for one day.
Evidence of Debt. Loans made by each Lender shall be evidenced by one or
more accounts or records maintained by such Lender and by Administrative Agent
in the ordinary course of business. The accounts or records maintained by
Administrative Agent and each Lender shall be conclusive absent manifest error
of the amount of the Loans made by Lenders to Borrowers and the interest and
payments thereon. Any failure to so record or any error in doing so shall not,
however, limit or otherwise affect the obligation of Borrowers hereunder to pay
any amount owing with respect to the Obligations. In the event of any conflict
between the accounts and records maintained by any Lender and the accounts and
records of Administrative Agent in respect of such matters, the accounts and
records of Administrative Agent shall control in the absence of manifest error.
Upon the request of any Lender made through Administrative Agent, Borrowers
shall execute and deliver to such Lender (through Administrative Agent) a Note,
which shall evidence such Lender's Loans in addition to such accounts or
records. Each Lender may attach schedules to its Note and endorse thereon the
date, Type (if applicable), amount and maturity of its Loans and payments with
respect thereto.
Payments Generally.
(a) All payments to be made by Borrowers shall be made without condition
or deduction for any counterclaim, defense, recoupment, or setoff. Except as
otherwise expressly provided herein, all payments by Borrowers hereunder shall
be made to Administrative Agent, for the account of the respective Lenders to
which such payment is owed, at Administrative Agent's Office in Dollars and in
immediately available funds not later than 2:00 p.m. on the date specified
herein. Administrative Agent will promptly distribute to each Lender its Pro
Rata Share (or other applicable share as provided herein)
Credit Agreement 24
of such payment in like funds as received by wire transfer to such Lender's
Lending Office. All payments received by Administrative Agent after 2:00 p.m.
shall be deemed received on the next succeeding Business Day and any applicable
interest or fee shall continue to accrue.
(b) If any payment to be made by Borrowers shall come due on a day other
than a Business Day, payment shall be made on the next following Business Day,
and such extension of time shall be reflected in computing interest or fees, as
the case may be.
(c) Unless Borrowers or any Lender have notified Administrative Agent,
prior to the date any payment is required to be made by it to Administrative
Agent hereunder, that Borrowers or such Lender, as the case may be, will not
make such payment, Administrative Agent may assume that Borrowers or such
Lender, as the case may be, have timely made such payment and may (but shall not
be so required to), in reliance thereon, make available a corresponding amount
to the Person entitled thereto. If and to the extent that such payment was not
in fact made to Administrative Agent in immediately available funds, then:
(i) if Borrowers failed to make such payment, each Lender shall
forthwith on demand repay to Administrative Agent the portion of such
assumed payment that was made available to such Lender in immediately
available funds, together with interest thereon in respect of each day from
and including the date such amount was made available by Administrative
Agent to such Lender to the date such amount is repaid to Administrative
Agent in immediately available funds at the Federal Funds Rate from time to
time in effect; and
(ii) if any Lender failed to make such payment, such Lender shall
forthwith on demand pay to Administrative Agent the amount thereof in
immediately available funds, together with interest thereon for the period
from the date such amount was made available by Administrative Agent to
Borrowers to the date such amount is recovered by Administrative Agent (the
"Compensation Period") at a rate per annum equal to the Federal Funds Rate
from time to time in effect. If such Lender pays such amount to
Administrative Agent, then such amount shall constitute such Lender's Loan
included in the applicable Borrowing. If such Lender does not pay such
amount forthwith upon Administrative Agent's demand therefor,
Administrative Agent may make a demand therefor upon Borrowers, and
Borrowers shall pay such amount to Administrative Agent, together with
interest thereon for the Compensation Period at a rate per annum equal to
the rate of interest applicable to the applicable Borrowing. Nothing herein
shall be deemed to relieve any Lender from its obligation to fulfill its
Commitment or to prejudice any rights which Administrative Agent or
Borrowers may have against any Lender as a result of any default by such
Lender hereunder.
A notice of Administrative Agent to any Lender or Borrowers with respect to
any amount owing under this Section 2.10(c) shall be conclusive, absent manifest
error.
(d) If any Lender makes available to Administrative Agent funds for any
Loan to be made by such Lender as provided in the foregoing provisions of this
Article II, and such funds are not made available to Borrowers by Administrative
Agent because the conditions to the applicable Borrowing set forth in Article IV
are not satisfied or waived in accordance with the terms hereof, Administrative
Agent shall return such funds (in like funds as received from such Lender) to
such Lender, without interest.
(e) The obligations of Lenders hereunder to make Loans are several and not
joint. The failure of any Lender to make any Loan or to fund any such
participation on any date required hereunder shall not relieve any other Lender
of its corresponding obligation to do so on such date, and no Lender shall be
responsible for the failure of any other Lender to so make its Loan or purchase
its participation.
Credit Agreement 25
(f) Nothing herein shall be deemed to obligate any Lender to obtain the
funds for any Loan in any particular place or manner or to constitute a
representation by any Lender that it has obtained or will obtain the funds for
any Loan in any particular place or manner.
Sharing of Payments. If, other than as expressly provided elsewhere herein,
any Lender shall obtain on account of the Loans made by it, any payment (whether
voluntary, involuntary, through the exercise of any right of set-off, or
otherwise) in excess of its ratable share (or other share contemplated
hereunder) thereof, such Lender shall immediately (a) notify Administrative
Agent of such fact, and (b) purchase from the other Lenders such participations
in the Loans made by them as shall be necessary to cause such purchasing Lender
to share the excess payment in respect of such Loans or such participations, as
the case may be, pro rata with each of them; provided, however, that if all or
any portion of such excess payment is thereafter recovered from the purchasing
Lender under any of the circumstances described in Section 10.06 (including
pursuant to any settlement entered into by the purchasing Lender in its
discretion), such purchase shall to that extent be rescinded and each other
Lender shall repay to the purchasing Lender the purchase price paid therefor,
together with an amount equal to such paying Lender's ratable share (according
to the proportion of (i) the amount of such paying Lender's required repayment
to (ii) the total amount so recovered from the purchasing Lender) of any
interest or other amount paid or payable by the purchasing Lender in respect of
the total amount so recovered, without further interest thereon. Borrowers agree
that any Lender so purchasing a participation from another Lender may, to the
fullest extent permitted by law, exercise all its rights of payment (including
the right of set-off, but subject to Section 10.09) with respect to such
participation as fully as if such Lender were the direct creditor of Borrowers
in the amount of such participation. Administrative Agent will keep records
(which shall be conclusive and binding in the absence of manifest error) of
participations purchased under this Section 2.11 and will in each case notify
Lenders following any such purchases or repayments. Each Lender that purchases a
participation pursuant to this Section shall from and after such purchase have
the right to give all notices, requests, demands, directions, and other
communications under this Agreement with respect to the portion of the
Obligations purchased to the same extent as though the purchasing Lender were
the original owner of the Obligations purchased.
Collateral; Guaranties.
(a) Pledge Agreements and Mortgages. As security for the payment and
performance of the Obligations, on or prior to the Closing Date, Administrative
Agent shall receive, for the benefit of the Lenders, a first priority perfected
security interest in, and Lien upon (i) the stock or other equity ownership
interests of CNL Rose GP Corp., Acquisition Sub, Borrowers, and all now existing
or hereafter arising direct Subsidiaries of Acquisition Sub and Operating
Company (including the Subsidiaries listed on Schedule 2.12(i)); provided that
each such Lien shall be limited to the extent required to comply with all
agreements governing existing Indebtedness of Subsidiaries of Operating Company,
and (ii) the Collateral Properties listed on Schedule 2.12(ii).
(b) Guaranties. Each of the Guarantors shall execute and deliver to
Administrative Agent the Guaranty, pursuant to which such Guarantors shall
guaranty payment and performance of the Obligations.
(c) Further Assurances. Parent and Borrowers hereby agree to execute and
deliver, and to cause to be executed and delivered, to Administrative Agent, at
Borrowers' sole cost and expense, such replacement guaranties, financing or
continuation statements, third party consents, and such other amendments,
agreements, documents, assignments, statements, or instruments as Administrative
Agent may from time to time reasonably request to evidence, perfect, or
otherwise implement the security for performance and repayment of the
Obligations. All of the foregoing shall be reasonably satisfactory in form and
substance to Administrative Agent.
Credit Agreement 26
(d) Initial Release of CMBS Collateral Properties. Upon receipt by
Administrative Agent of one hundred percent (100%) of the Net Cash Proceeds of
the initial CMBS Facility, which proceeds shall be applied to the Obligations in
accordance with Section 2.03(d) and Section 8.03, Administrative Agent shall
release its Liens on the CMBS Collateral Properties which secure such CMBS
Facility so long as (i) at the time of such release no Default or Event of
Default exists or would result therefrom, (ii) at least the lesser of (A)
$250,000,000 (from sources other than the capital contribution required in
Section 4.01(a)(xx)) and (B) an amount equal to the then outstanding Obligations
is applied as a prepayment of the Obligations, and (iii) after giving effect to
such release, Borrowers are in compliance with Section 7.17.
(e) Subsequent Release of CMBS Collateral Properties. Upon receipt by
Administrative Agent of one hundred percent (100%) of the Net Cash Proceeds of
any CMBS Facility closing after the initial CMBS Facility referenced in Section
2.12(d) above, which proceeds shall be applied to the Obligations in accordance
with Section 2.03(d) and Section 8.03, Administrative Agent shall release its
Liens on the CMBS Collateral Properties which secure such CMBS Facility so long
as (i) at the time of such release no Default or Event of Default exists or
would result therefrom, and (ii) after giving effect to such release, Borrowers
are in compliance with Section 7.17.
(f) Other Collateral Property Releases.
(i) Upon receipt by Administrative Agent of the Net Cash Proceeds
(or such greater amount required by Section 7.05(f)) from the sale of any
Collateral Property permitted by Section 7.05(f), Administrative Agent
shall release its Lien on such Collateral Property.
(ii) Upon the written request of Borrowers to Administrative Agent,
Administrative Agent shall release its Lien on any Excluded Collateral
Property so long as at the time of such release, no Default or Event of
Default exists or would result therefrom.
TAXES, YIELD PROTECTION AND ILLEGALITY
Taxes.
(a) Any and all payments by Borrowers to or for the account of
Administrative Agent or any Lender under any Loan Document shall be made free
and clear of and without deduction for any and all present or future taxes,
duties, levies, imposts, deductions, assessments, fees, withholdings or similar
charges, and all liabilities with respect thereto, excluding, in the case of
Administrative Agent and each Lender, taxes imposed on or measured by its
overall net income, and franchise taxes imposed on it (in lieu of net income
taxes), by the jurisdiction (or any political subdivision thereof) under the
Laws of which Administrative Agent or such Lender, as the case may be, is
organized or maintains a lending office (all such non-excluded taxes, duties,
levies, imposts, deductions, assessments, fees, withholdings or similar charges,
and liabilities being hereinafter referred to as "Taxes "). If Borrowers shall
be required by any Laws to deduct any Taxes from or in respect of any sum
payable under any Loan Document to Administrative Agent or any Lender, (i) the
sum payable shall be increased as necessary so that after making all required
deductions (including deductions applicable to additional sums payable under
this Section), each of Administrative Agent and such Lender receives an amount
equal to the sum it would have received had no such deductions been made, (ii)
Borrowers shall make such deductions, (iii) Borrowers shall pay the full amount
deducted to the relevant taxation authority or other authority in accordance
with applicable Laws, and (iv) within thirty (30) days after the date of such
payment,
Credit Agreement 27
Borrowers shall furnish to Administrative Agent (which shall forward the same to
such Lender) the original or a certified copy of a receipt evidencing payment
thereof.
(b) In addition, Borrowers agree to pay any and all present or future
stamp, court or documentary taxes and any other excise or property taxes or
charges or similar levies which arise from any payment made under any Loan
Document or from the execution, delivery, performance, enforcement, or
registration of, or otherwise with respect to, any Loan Document (hereinafter
referred to as "Other Taxes").
(c) If Borrowers shall be required to deduct or pay any Taxes or Other
Taxes from or in respect of any sum payable under any Loan Document to
Administrative Agent or any Lender, Borrowers shall also pay to Administrative
Agent or to such Lender, as the case may be, at the time interest is paid, such
additional amount that Administrative Agent or such Lender specifies is
necessary to preserve the after-tax yield (after factoring in all taxes,
including taxes imposed on or measured by net income) that Administrative Agent
or such Lender would have received if such Taxes or Other Taxes had not been
imposed.
(d) Borrowers agree to indemnify Administrative Agent and each Lender for
(i) the full amount of Taxes and Other Taxes (including any Taxes or Other Taxes
imposed or asserted by any jurisdiction on amounts payable under this Section)
paid by Administrative Agent and such Lender, (ii) amounts payable under Section
3.01(c), and (iii) any liability (including additions to tax, penalties,
interest and expenses) arising therefrom or with respect thereto, in each case
whether or not such Taxes or Other Taxes were correctly or legally imposed or
asserted by the relevant Governmental Authority. Payment under this Section
3.01(d) shall be made within thirty (30) days after the date the Lender or
Administrative Agent makes a demand therefor.
Illegality. If any Lender determines that any Law has made it unlawful, or
that any Governmental Authority has asserted that it is unlawful, for any Lender
or its applicable Lending Office to make, maintain or fund Eurodollar Rate
Loans, or to determine or charge interest rates based upon the Eurodollar Rate,
then, on notice thereof by such Lender to Borrowers through Administrative
Agent, any obligation of such Lender to make or continue Eurodollar Rate Loans
or to convert Base Rate Loans to Eurodollar Rate Loans shall be suspended until
such Lender notifies Administrative Agent and Borrowers that the circumstances
giving rise to such determination no longer exist. Upon receipt of such notice,
Borrowers shall, upon demand from such Lender (with a copy to Administrative
Agent), prepay or, if applicable, convert all Eurodollar Rate Loans of such
Lender to Base Rate Loans, either on the last day of the Interest Period
therefor, if such Lender may lawfully continue to maintain such Eurodollar Rate
Loans to such day, or immediately, if such Lender may not lawfully continue to
maintain such Eurodollar Rate Loans. Upon any such prepayment or conversion,
Borrowers shall also pay accrued interest on the amount so prepaid or converted.
Each Lender agrees to designate a different Lending Office if such designation
will avoid the need for such notice and will not, in the good faith judgment of
such Lender, otherwise be materially disadvantageous to such Lender.
Inability to Determine Rates. If the Required Lenders determine that for
any reason adequate and reasonable means do not exist for determining the
Eurodollar Rate for any requested Interest Period with respect to a proposed
Eurodollar Rate Loan, or that the Eurodollar Rate for any requested Interest
Period with respect to a proposed Eurodollar Rate Loan does not adequately and
fairly reflect the cost to such Lenders of funding such Loan, Administrative
Agent will promptly so notify Borrowers and each Lender. Thereafter, the
obligation of Lenders to make or maintain Eurodollar Rate Loans shall be
suspended until Administrative Agent (upon the instruction of the Required
Lenders) revokes such notice. Upon receipt of such notice, Borrowers may revoke
any pending request for a Borrowing of, conversion
Credit Agreement 28
to or continuation of Eurodollar Rate Loans or, failing that, will be deemed to
have converted such request into a request for a Committed Borrowing of Base
Rate Loans in the amount specified therein.
Increased Cost and Reduced Return; Capital Adequacy; Reserves on Eurodollar
Rate Loans.
(a) If any Lender determines that as a result of the introduction of or
any change in or in the interpretation of any Law, or such Lender's compliance
therewith, there shall be any increase in the cost to such Lender of agreeing to
make or making, funding or maintaining Eurodollar Rate Loans, or a reduction in
the amount received or receivable by such Lender in connection with any of the
foregoing (excluding for purposes of this Section 3.04(a) any such increased
costs or reduction in amount resulting from (i) Taxes or Other Taxes (as to
which Section 3.01 shall govern), (ii) changes in the basis of taxation of
overall net income or overall gross income by the United States or any foreign
jurisdiction or any political subdivision of either thereof under the Laws of
which such Lender is organized or has its Lending Office, and (iii) reserve
requirements contemplated by Section 3.04(c)), then from time to time upon
demand of such Lender (with a copy of such demand to Administrative Agent),
Borrowers shall pay to such Lender such additional amounts as will compensate
such Lender for such increased cost or reduction.
(b) If any Lender determines that the introduction of any Law regarding
capital adequacy or any change therein or in the interpretation thereof, or
compliance by such Lender (or its Lending Office) therewith, has the effect of
reducing the rate of return on the capital of such Lender or any corporation
controlling such Lender as a consequence of such Lender's obligations hereunder
(taking into consideration its policies with respect to capital adequacy and
such Lender's desired return on capital), then from time to time upon demand of
such Lender (with a copy of such demand to Administrative Agent), Borrowers
shall pay to such Lender such additional amounts as will compensate such Lender
for such reduction.
(c) Borrowers shall pay to each Lender, as long as such Lender shall be
required to maintain reserves with respect to liabilities or assets consisting
of or including Eurocurrency funds or deposits (currently known as "Eurocurrency
liabilities"), additional interest on the unpaid principal amount of each
Eurodollar Rate Loan equal to the actual costs of such reserves allocated to
such Loan by such Lender (as determined by such Lender in good faith, which
determination shall be conclusive), which shall be due and payable on each date
on which interest is payable on such Loan, provided Borrowers shall have
received at least fifteen (15) days' prior notice (with a copy to Administrative
Agent) of such additional interest from such Lender. If a Lender fails to give
notice fifteen (15) days prior to the relevant Interest Payment Date, such
additional interest shall be due and payable fifteen (15) days from receipt of
such notice.
Funding Losses. Upon demand of any Lender (with a copy to Administrative
Agent) from time to time, Borrowers shall promptly compensate such Lender for
and hold such Lender harmless from any loss, cost, or expense incurred by them
as a result of:
(a) any continuation, conversion, payment, or prepayment of any Loan other
than a Base Rate Loan on a day other than the last day of the Interest Period
for such Loan (whether voluntary, mandatory, automatic, by reason of
acceleration, or otherwise);
(b) any failure by Borrowers (for a reason other than the failure of such
Lender to make a Loan) to prepay, borrow, continue, or convert any Loan other
than a Base Rate Loan on the date or in the amount notified by Borrowers; or
Credit Agreement 29
(c) any assignment of a Eurodollar Rate Loan on a day other than the last
day of the Interest Period therefor as a result of a request by Borrowers
pursuant to Section 10.16;
including any loss of anticipated profits and any loss or expense arising from
the liquidation or reemployment of funds obtained by it to maintain such Loan or
from fees payable to terminate the deposits from which such funds were obtained.
Borrowers shall also pay any customary administrative fees charged by such
Lender in connection with the foregoing.
For purposes of calculating amounts payable by Borrowers to Lenders under this
Section 3.05, each Lender shall be deemed to have funded each Eurodollar Rate
Loan made by it at the Eurodollar Rate for such Loan by a matching deposit or
other borrowing in the London interbank eurodollar market for a comparable
amount and for a comparable period, whether or not such Eurodollar Rate Loan was
in fact so funded.
Matters Applicable to all Requests for Compensation.
(a) A certificate of Administrative Agent or any Lender claiming
compensation under this Article III and setting forth the additional amount or
amounts to be paid to it hereunder shall be conclusive in the absence of
manifest error. In determining such amount, Administrative Agent or such Lender
may use any reasonable averaging and attribution methods.
(b) Upon any Lender's making a claim for compensation under Section 3.01
or 3.04, Borrowers may replace such Lender in accordance with Section 10.16.
Survival. All of Borrowers' obligations under this Article III shall
survive termination of the Aggregate Commitments and repayment of all other
Obligations hereunder.
CONDITIONS PRECEDENT TO BORROWINGS
Conditions of Initial Borrowing. The obligation of each Lender to make its
initial Loan hereunder is subject to satisfaction of the following conditions
precedent:
(a) Administrative Agent's receipt of the following (except to the extent
otherwise set forth on Schedule 6.23), each of which shall be originals or
facsimiles (followed promptly by originals) unless otherwise specified, each
properly executed by a Responsible Officer of the signing Loan Party, each dated
the Closing Date (or, in the case of certificates of governmental officials, a
recent date before the Closing Date) and each in form and substance satisfactory
to Administrative Agent and its legal counsel:
(i) executed counterparts of this Agreement, the Pledge
Agreements, and the Guaranty, sufficient in number for distribution to
Administrative Agent, each Lender, and Borrowers;
(ii) a Note executed by Borrowers in favor of each Lender
requesting a Note;
(iii) such certificates of resolutions or other action, incumbency
certificates, and/or other certificates of Responsible Officers of each
Loan Party as Administrative Agent may require evidencing the identity,
authority, and capacity of each Responsible Officer thereof authorized to
act as a Responsible Officer in connection with this Agreement and the
other Loan Documents to which such Loan Party is a party;
Credit Agreement 30
(iv) such documents and certifications as Administrative Agent may
reasonably require to evidence that each Loan Party is duly organized or
formed, and that each Loan Party is validly existing, in good standing, and
qualified to engage in business in each jurisdiction where its ownership,
lease or operation of properties or the conduct of its business requires
such qualification, except to the extent that failure to do so could not
reasonably be expected to have a Material Adverse Effect;
(v) a favorable opinion of Lowndes, Drosdick, Doster, Xxxxxx &
Xxxx, P.A., counsel to the Loan Parties, and such other local counsel
opinions as Administrative Agent shall request, all addressed to
Administrative Agent and each Lender, as to such matters concerning the
Loan Parties and the Loan Documents as the Administrative Agent may
reasonably request;
(vi) a certificate of a Responsible Officer of each Loan Party
either (A) attaching copies of all consents, licenses, and approvals
required in connection with the execution, delivery, and performance by
such Loan Party, and the validity against such Loan Party, of the Loan
Documents to which it is a party, and such consents, licenses, and
approvals shall be in full force and effect, or (B) stating that no such
consents, licenses, or approvals are so required;
(vii) a certificate signed by a Responsible Officer of Borrowers
certifying (A) that the conditions specified in Sections 4.02(a) and (b)
and Section 4.03 have been satisfied, and (B) that there has been no event
or circumstance since the date of the Audited Financial Statements that has
had or could be reasonably expected to have, either individually or in the
aggregate, a Material Adverse Effect;
(viii) evidence that all amounts due and payable under the Existing
Credit Agreement have been indefeasibly paid in full, all letters of credit
issued thereunder have been canceled or cash collateralized, and
commitments to lend thereunder are terminated concurrently with the Closing
Date and that all Liens securing obligations under the Existing Credit
Agreement have been or concurrently with the Closing Date are being
released;
(ix) the insurance policies satisfying the requirements of Section
6.07;
(x) an Acceptable Appraisal of each Collateral Property made
within thirty (30) days prior to the date of this Agreement;
(xi) (A) two (2) prints of an original survey of each Collateral
Property and improvements thereon dated not more than sixty (60) days prior
to the date of this Agreement (or dated such earlier date, if any, as is
satisfactory to Administrative Agent and the Title Insurer, but in any
event not more than one hundred eighty (180) days prior to the date of this
Agreement) and otherwise complying with Exhibit E to the extent required by
Administrative Agent and the Title Insurer; and (B) a flood insurance
policy in an amount required by Administrative Agent, but in no event less
than the amount sufficient to meet the requirements of applicable law and
the Flood Disaster Protection Act of 1973, as amended, or evidence
satisfactory to Administrative Agent that none of the Collateral Properties
are located in a flood hazard area;
(xii) true and correct copies of all existing Plans within the
possession or control of the Loan Parties or any Operating Lessee which is
an Affiliate of a Loan Party (including the site plan) requested by
Administrative Agent, together with evidence satisfactory to Administrative
Agent that the same comply in all material respects to applicable
requirements of Governmental Authorities;
Credit Agreement 31
(xiii) (A) true and correct copies of all material leases (other than
the Operating Leases and the Ground Leases) and subleases, and guarantees
thereof; (B) estoppel certificates and subordination and attornment
agreements (including nondisturbance agreements if and to the extent agreed
by Administrative Agent in its discretion), dated within thirty (30) days
prior to this Agreement and in form and content satisfactory to
Administrative Agent, from the tenants and subtenants as Administrative
Agent requires; (C) evidence of each Borrower's compliance with the leases
delivered pursuant to clause (A) above; and (D) evidence of the tenants'
approval of all matters requiring their approval relating to the Merger
Transactions and the Loans;
(xiv) evidence satisfactory to Administrative Agent that no portion
of any Collateral Property is "wetlands" under any applicable Law and no
Collateral Property contains nor is within or near any area designated as a
hazardous waste site by any Governmental Authority, that no Collateral
Property nor any adjoining property contains or has ever contained any
Hazardous Material under any Law pertaining to health or the environment,
and that no Collateral Property nor any use or activity thereon violates or
is or could be subject to any response, remediation, clean-up or other
obligation under any Law pertaining to health or the environment including
without limitation, a written report of an environmental assessment of each
Collateral Property, made within thirty (30) days prior to the date of this
Agreement, by an engineering firm, and of a scope and in form and content
satisfactory to Administrative Agent, complying with Administrative Agent's
established guidelines, showing that there is no evidence of any Hazardous
Material which has been generated, treated, stored, released, or disposed
of in any Collateral Property, and such additional evidence as may be
required by Administrative Agent. All reports, drafts of reports, and
recommendations, whether written or oral, from such engineering firm shall
be made available and communicated to Administrative Agent;
(xv) (A) evidence that each Collateral Property abuts and has fully
adequate direct and free access to one or more public streets, dedicated to
public use, fully installed and accepted by the appropriate Governmental
Authority, that all fees, costs and expenses of the installation and
acceptance thereof have been paid in full, and that there are no
restrictions on the use and enjoyment of such streets which would adversely
affect such Collateral Property; (B) evidence that all applicable zoning
ordinances, restrictive covenants, and Laws affecting each Collateral
Property permit the use for which such Collateral Property is intended and
have been or will be complied with without the existence of any variance,
non-complying use, nonconforming use or other special exception; (C)
evidence that each Collateral Property and Improvements comply and will
comply with all Laws regarding subdivision and platting and would so comply
if such Collateral Property and the Improvements thereon were conveyed as a
separate parcel; and (D) evidence of compliance by Borrowers and each
Collateral Property, and any proposed construction, use and occupancy of
the Improvements, with such other applicable Laws as Administrative Agent
may request, including all Laws regarding access and facilities for
handicapped or disabled persons including, without limitation and to the
extent applicable, The Federal Architectural Barriers Act (42 U.S.C. (S)
4151 et seq.), The Fair Housing Amendments Act of 1988 (42 U.S.C. (S) 3601
et seq.), The Americans With Disabilities Act of 1990 (42 U.S.C. (S) 12101
et seq.), The Rehabilitation Act of 1973 (29 U.S.C. (S) 794), and any
applicable state requirements;
(xvi) evidence (A) of the identity of all taxing authorities and
utility districts (or similar authorities) currently exercising ad valorem
or real property taxing or assessment jurisdiction over any Collateral
Property or any portion thereof; (B) that all taxes, standby fees and any
other similar charges have been paid, including copies of receipts or
statements marked "paid" by the appropriate authority; and (C) that each
Collateral Property is a separate tax lot or lots with separate assessment
or assessments of the Collateral Property and Improvements,
Credit Agreement 32
independent of any other Collateral Property or improvements and that each
Collateral Property is a separate legally subdivided parcel;
(xvii) executed, acknowledged, and/or sworn to as required
counterparts of the Mortgages, which shall have been delivered to the Title
Insurer and released for recordation in the official records of the city or
county in which each Collateral Property is located, and UCC-1 financing
statements which shall have been furnished for filing in all filing offices
that Administrative Agent may require;
(xviii) an ALTA title insurance policy or unconditional "xxxx up"
commitment for such title insurance policy (or a title insurance policy
promulgated by the Laws of the state in which each respective Collateral
Property is located if an ALTA insurance policy is not available), issued
by the Title Insurer (which shall be approved by Administrative Agent) in
the amount of the Aggregate Commitments plus any other amount secured by
the applicable Mortgage, on a coinsurance and/or reinsurance basis if and
as required by Administrative Agent, along with such available endorsements
as Administrative Agent shall reasonably request, insuring without
exclusion or exception (if permitted) for creditors' rights that the
applicable Mortgage constitutes a valid lien covering such Collateral
Property and all Improvements thereon, having the priority required by
Administrative Agent and subject only to those exceptions and encumbrances
(regardless of rank or priority) Administrative Agent approves, in a form
acceptable to Administrative Agent, and as satisfactory to Administrative
Agent with all "standard" exceptions which can be deleted, including the
exception for matters which a current survey would show, deleted to the
fullest extent authorized under applicable title insurance rules, and
Borrowers shall satisfy all requirements therefor permitted; containing no
exception for standby fees or real estate taxes or assessments other than
those for the year in which the closing occurs to the extent the same are
not then due and payable and endorsed "not yet due and payable" and no
exception for subsequent assessments for prior years; providing full
coverage against mechanics' and materialmens' liens to the extent
authorized under applicable title insurance rules, and Borrowers shall
satisfy all requirements therefor; insuring that no restrictive covenants
shown in the Title Insurance have been violated, and that no violation of
the restrictions will result in a reversion or forfeiture of title;
insuring all appurtenant easements; insuring that fee simple indefeasible
or marketable (as coverage is available) fee simple title to the Collateral
Properties and Improvements is vested in Borrowers; containing such
affirmative coverage and endorsements as Administrative Agent may require
and are available under applicable title insurance rules, and Borrowers
shall satisfy all requirements therefor; insuring any easements, leasehold
estates, or other matters appurtenant to or benefiting each Collateral
Property and/or the Improvements as part of the insured estate; insuring
the right of access to each Collateral Property to the extent authorized
under applicable title insurance rules, and Borrowers shall satisfy all
requirements therefor; and containing provisions acceptable to
Administrative Agent regarding advances and/or readvances of Loan funds
after closing. Borrowers and Borrowers' counsel shall not have any
interest, direct or indirect, in the Title Insurer (or its agent) or any
portion of the premium paid for the Title Insurance;
(xix) (A) evidence that immediately prior to the Closing Date and as
of the time the Mortgages will be filed for record: (I) no contract, or
memorandum thereof, for construction, design, surveying, or any other
service relating to any Collateral Property has been filed for record in
the county where such Collateral Property is located; and (II) no
mechanic's or materialman's lien claim or notice, lis pendens, judgment, or
other claim or encumbrance against such Collateral Property has been filed
for record in the county where the Collateral Property is located or in any
other public record which by Law provides notice of claims or encumbrances
regarding such Collateral Property; (B) a certificate or certificates of a
reporting service
Credit Agreement 33
acceptable to Administrative Agent, reflecting the results of searches made
not earlier than forty-five (45) days prior to the date of this Agreement,
(I) of the central and local Uniform Commercial Code records, showing no
filings against any of the collateral for the Obligations or against
Borrowers otherwise except as consented to by Administrative Agent; and
(II) if required by Administrative Agent, of the appropriate judgment and
tax lien records, showing no outstanding judgment or tax lien against
Borrowers;
(xx) evidence that a net capital contribution of equity in an
amount equal to or greater than $255,000,000 shall have been made to
Acquisition Sub or its Subsidiaries for use to pay a portion of the REIT
Merger Consideration under the Merger Agreement;
(xxi) to the extent deemed necessary by Administrative Agent, an
executed REA estoppel letter from each party to any REA for any applicable
Collateral Property;
(xxii) a true and correct copy of each Management Agreement with
respect to each Collateral Property;
(xxiii) (A) a true and correct copy of each Franchise Agreement with
respect to each Collateral Property and (B) a franchisor estoppel / comfort
letter executed by each Franchisor;
(xxiv) (A) a true and correct copy of each Ground Lease and (B) a
fully executed ground lessor estoppel from each ground lessor under each
Ground Lease reflecting that no such Ground Lease may be canceled,
terminated, surrendered, or amended without prior written consent of
Administrative Agent;
(xxv) (A) a true and correct copy of each Operating Lease, (B) a
fully executed Operating Lessee estoppel from the Operating Lessee under
each Operating Agreement, and (C) a fully executed subordination agreement
from each Operating Lessee which is an Affiliate of a Loan Party under its
Operating Agreement and a fully executed subordination and non-disturbance
agreement from each other Operating Lessee under its Operating Agreement;
(xxvi) such other assurances, certificates, documents, consents, or
opinions as Administrative Agent or the Required Lenders reasonably may
require; and
(xxvii) a completed and executed pro forma Compliance Certificate
dated as of March 31, 2003.
(b) Any fees required to be paid on or before the Closing Date shall have
been paid.
(c) Unless waived by Administrative Agent, Borrowers shall have paid all
Attorney Costs of Administrative Agent to the extent invoiced prior to or on the
Closing Date, plus such additional amounts of Attorney Costs as shall constitute
its reasonable estimate of Attorney Costs incurred or to be incurred by it
through the closing proceedings (provided that such estimate shall not
thereafter preclude a final settling of accounts between Borrowers and
Administrative Agent).
Conditions to all Borrowings. The obligation of each Lender to honor any
Borrowing request (other than a Loan Notice requesting only a conversion of
Loans to the other Type, or a continuation of Eurodollar Rate Loans) is subject
to the following conditions precedent:
(a) The representations and warranties of Borrowers and each other Loan
Party contained in Article V or any other Loan Document, or which are contained
in any document furnished at any time
Credit Agreement 34
under or in connection herewith or therewith, shall be true and correct on and
as of the date of such Borrowing, except to the extent that such representations
and warranties specifically refer to an earlier date, in which case they shall
be true and correct as of such earlier date, and except that for purposes of
this Section 4.02, the representations and warranties contained in Sections
5.05(a) and (b) shall be deemed to refer to the most recent statements furnished
pursuant to clauses (a), (b), (c), and (d), respectively, of Section 6.01.
(b) No Default shall exist, or would result from such proposed Borrowing.
(c) If requested by Administrative Agent, Administrative Agent shall
receive such down date endorsements or other assurances from the Title Insurer
with respect to the Title Insurance as Administrative Agent shall require
regarding advances of Loans.
Special Conditions. The obligation of each Lender to make its initial Loan
hereunder is subject to the additional conditions precedent that, on or before
the date of the initial Loans:
(a) Contemporaneously with the making of the initial Loans, the Merger
Transactions shall have occurred;
(b) The representations and warranties set forth in the Loan Documents are
true and correct in all material respects, immediately prior to, and after
giving effect to, the Merger Transactions;
(c) Administrative Agent and its legal counsel shall have received, and be
reasonably satisfied with, the Transaction Documents, including purchase and
sale documentation, covenants not to compete, indemnities, and opinions of
counsel (which shall provide customary assurances regarding the legal status and
authority, the validity and enforceability of the transaction, and other
matters), which opinions of counsel may be relied upon by Administrative Agent
and Lenders;
(d) The execution, delivery, and performance of the Loan Documents, and
the making of Loans, will not violate, conflict with, or breach any terms or
provisions governing the Senior Notes; and
(e) Administrative Agent shall have received evidence that Parent has
received the CMBS Engagement Letter.
Each Borrowing request (other than a Loan Notice requesting only a
conversion of Loans to the other Type or a continuation of Eurodollar Rate
Loans) submitted by Borrowers shall be deemed to be a representation and
warranty that the conditions specified in Sections 4.02(a) and (b) and Section
4.03 have been satisfied on and as of the date of the applicable Borrowing.
REPRESENTATIONS AND WARRANTIES
Parent and Borrowers represent and warrant to Administrative Agent and Lenders
that:
Existence, Qualification, and Power; Compliance with Laws. Parent and each
RFS Company (a) is a corporation, partnership, or limited liability company duly
organized or formed, validly existing, and in good standing under the Laws of
the jurisdiction of its incorporation or organization, (b) has all requisite
power and authority and all requisite governmental licenses, authorizations,
consents, and approvals to (i) own its assets and carry on its business and (ii)
execute, deliver, and perform its obligations under the Loan Documents to which
it is a party, (c) is duly qualified and is licensed and in good standing under
the Laws of each jurisdiction where its ownership, lease, or operation of
properties or the conduct of its business requires such qualification or
license, and (d) is in compliance with all
Credit Agreement 35
Laws; except in each case referred to in clause (b)(i), (c), or (d), to the
extent that failure to do so could not reasonably be expected to have a Material
Adverse Effect.
Authorization; No Contravention. The execution, delivery, and performance
by each Loan Party of each Loan Document to which such Person is party, have
been duly authorized by all necessary corporate or other organizational action,
and do not and will not (a) contravene the terms of any of such Person's
Organization Documents, (b) conflict with or result in any breach or
contravention of, or the creation of any Lien under, (i) any Contractual
Obligation to which such Person is a party or (ii) any order, injunction, writ,
or decree of any Governmental Authority or any arbitral award to which such
Person or its property is subject, or (c) violate any Law.
Governmental Authorization; Other Consents. No approval, consent,
exemption, authorization, or other action by, or notice to, or filing with, any
Governmental Authority or any other Person is necessary or required in
connection with the execution, delivery, or performance by, or enforcement
against, any Loan Party of this Agreement or any other Loan Document.
Binding Effect. This Agreement has been, and each other Loan Document, when
delivered hereunder, will have been, duly executed and delivered by each Loan
Party that is party thereto. This Agreement constitutes, and each other Loan
Document when so delivered will constitute, a legal, valid, and binding
obligation of such Loan Party, enforceable against each Loan Party that is party
thereto in accordance with its terms.
Financial Statements; No Material Adverse Effect.
(a) The Audited Financial Statements (i) were prepared in accordance with
GAAP consistently applied throughout the period covered thereby, except as
otherwise expressly noted therein, (ii) fairly present the financial condition
of Operating Company and its Subsidiaries or Parent and its Subsidiaries, as
applicable, as of the date thereof and their results of operations for the
period covered thereby in accordance with GAAP consistently applied throughout
the period covered thereby, except as otherwise expressly noted therein, and
(iii) show all material indebtedness and other liabilities, direct or
contingent, of Operating Company and its Subsidiaries or Parent and its
Subsidiaries, as applicable, as of the date thereof, including liabilities for
taxes, material commitments, and Indebtedness.
(b) The unaudited consolidated financial statements of (i) Operating
Company and its Subsidiaries dated as of March 31, 2003, and the related
consolidated statements of income or operations, shareholders' equity, and cash
flows for the fiscal quarter ended on that date, and (ii) Parent and its
Subsidiaries dated as of March 31, 2003, and the related consolidated statements
of income or operations, shareholders' equity, and cash flows for the fiscal
quarter ended on that date (A) were prepared in accordance with GAAP
consistently applied throughout the period covered thereby, except as otherwise
expressly noted therein, and (B) fairly present the financial condition of
Operating Company and its Subsidiaries or Parent and its Subsidiaries, as
applicable, as of the date thereof and their results of operations for the
period covered thereby, subject, in the case of clauses (i) and (ii), to the
absence of footnotes and to normal year-end audit adjustments.
(c) Since the date of the Audited Financial Statements, there has been no
event or circumstance, either individually or in the aggregate, that has had or
could reasonably be expected to have a Material Adverse Effect.
Litigation. Except as specifically disclosed in Schedule 5.06, there are no
actions, suits, proceedings, claims, or disputes pending or, to the knowledge of
Parent or any RFS Company after due and diligent investigation, threatened or
contemplated, at law, in equity, in arbitration or before any
Credit Agreement 36
Governmental Authority, by or against Parent or any RFS Company or against any
of their properties or revenues that (a) purport to affect or pertain to this
Agreement or any other Loan Document, or any of the transactions contemplated
hereby, or (b) either individually or in the aggregate, if determined adversely,
could reasonably be expected to have a Material Adverse Effect.
No Default. Neither Parent nor any RFS Company is in default under or with
respect to any Contractual Obligation that could, either individually or in the
aggregate, reasonably be expected to have a Material Adverse Effect. No Default
has occurred and is continuing or would result from the consummation of the
transactions contemplated by this Agreement or any other Loan Document.
Ownership of Property; Liens.
Parent and each RFS Company has good record and marketable title in fee simple
to, or valid leasehold interests in, all Property necessary or used in the
ordinary conduct of its business, except for such defects in title as could not,
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect. The Collateral Properties of each Borrower are not subject to
any Liens, other than Liens permitted by Section 7.01.
Environmental Representations.
(a) Parent and each RFS Company conduct in the ordinary course of business
a review of the effect of Environmental Laws and claims alleging potential
liability or responsibility for violation of any Environmental Law on their
respective businesses, operations, and properties, and as a result thereof
Parent and each RFS Company have reasonably concluded that such Environmental
Laws and claims could not, individually or in the aggregate, reasonably be
expected to cause a Material Property Event.
(b) After due inquiry and investigation in accordance with good commercial
or customary practices to determine whether contamination is present on any
Properties or elsewhere in connection with any activity on such Properties,
without regard to whether Administrative Agent or any Lender has or hereafter
obtains any knowledge or report of the environmental condition of the
Properties, except as may be indicated in the environmental assessment reports
delivered to Administrative Agent prior to the Closing Date in connection with
its due diligence investigations in connection with the Loans: (a) during the
period of Parent's or any RFS Company's ownership of the Properties, the
Properties have not been used for industrial or manufacturing purposes, for
landfill, dumping, or other waste disposal activities or operations, for
generation, storage, use, sale, treatment, processing, recycling, or disposal of
any Hazardous Material, for underground or aboveground storage tanks, or for any
other use that could give rise to a Material Property Event; to Parent's and
each RFS Company's knowledge, no such use of the Properties occurred at any time
prior to the period of Parent's or any RFS Company's ownership of the
Properties; and to Parent's and each RFS Company's knowledge, no such use on any
adjacent property occurred at any time prior to the date hereof which could
reasonably be expected to cause a Material Property Event; (b) to Parent's
knowledge, there is no Hazardous Material, storage tank (or similar vessel)
whether underground or otherwise, sump or well currently on the Properties which
could reasonably be expected to cause a Material Property Event; (c) neither
Parent nor any RFS Company has received any notice and has no knowledge of any
Environmental Claim or any completed, pending or proposed or threatened
investigation or inquiry concerning the presence or release of any Hazardous
Material on its Properties or any adjacent property or concerning whether any
condition, use or activity on the Property or any adjacent property is in
violation of any Environmental Requirement; (d) the present conditions, uses,
and activities on the Properties do not violate any Environmental Requirement
and the use of the Properties which Parent or any RFS Company (and each tenant
and subtenant, if any) makes and intends to make of the Properties complies and
will comply with all applicable Environmental Requirements; (e) the Properties
do not appear on and to Parent's and each RFS Company's knowledge have never
been on the National Priorities List, any federal or state "superfund" or
"superlien" list, or any
Credit Agreement 37
other list or database of properties maintained by any local, state, or federal
agency or department showing properties which are known to contain or which are
suspected of containing a Hazardous Material; (f) neither Parent nor any RFS
Company has ever applied for and been denied environmental impairment liability
insurance coverage relating to any Property; and (g) neither Parent or any RFS
Company has, nor have, to Parent's and each RFS Company's knowledge, any tenants
or subtenants, obtained any permit or authorization to construct, occupy,
operate, use, or conduct any activity on any of the Properties by reason of any
Environmental Requirement.
Insurance. The properties of Parent and each RFS Company are insured with
financially sound and reputable insurance companies not Affiliates of Parent or
any RFS Company, in such amounts (after giving effect to any self-insurance
compatible with the following standards), with such deductibles and covering
such risks as are customarily carried by companies engaged in similar businesses
and owning similar properties in localities where Parent or each RFS Company
operates.
Taxes. Parent and each RFS Company have filed all Federal, state, and other
material tax returns and reports required to be filed, and have paid all
Federal, state, and other material taxes, assessments, fees, and other
governmental charges levied or imposed upon them or their properties, income, or
assets otherwise due and payable, except those which are being contested in good
faith by appropriate proceedings diligently conducted and for which adequate
reserves have been provided in accordance with GAAP, or which if not paid could
not reasonably be expected to have a Material Adverse Effect. There is no
proposed tax assessment against Parent or any RFS Company that would, if made,
have a Material Adverse Effect.
ERISA Compliance.
(a) Each Plan is in compliance in all material respects with the
applicable provisions of ERISA, the Code and other Federal or state Laws. Each
Plan that is intended to qualify under Section 401(a) of the Code has received a
favorable determination letter from the IRS or an application for such a letter
is currently being processed by the IRS with respect thereto and, to the best
knowledge of Parent, nothing has occurred which would prevent, or cause the loss
of, such qualification. Parent and each ERISA Affiliate have made all required
contributions to each Plan subject to Section 412 of the Code, and no
application for a funding waiver or an extension of any amortization period
pursuant to Section 412 of the Code has been made with respect to any Plan.
(b) There are no pending or, to the best knowledge of Parent, threatened
claims, actions, or lawsuits, or action by any Governmental Authority, with
respect to any Plan that could be reasonably be expected to have a Material
Adverse Effect. There has been no prohibited transaction or violation of the
fiduciary responsibility rules with respect to any Plan that has resulted or
could reasonably be expected to result in a Material Adverse Effect.
(c) (i) No ERISA Event has occurred or is reasonably expected to occur;
(ii) no Pension Plan has any Unfunded Pension Liability; (iii) neither Parent
nor any ERISA Affiliate has incurred, or reasonably expects to incur, any
liability under Title IV of ERISA with respect to any Pension Plan (other than
premiums due and not delinquent under Section 4007 of ERISA); (iv) neither
Parent nor any ERISA Affiliate has incurred, or reasonably expects to incur, any
liability (and no event has occurred which, with the giving of notice under
Section 4219 of ERISA, would result in such liability) under Sections 4201 or
4243 of ERISA with respect to a Multiemployer Plan; and (v) neither Parent nor
any ERISA Affiliate has engaged in a transaction that could be subject to
Sections 4069 or 4212(c) of ERISA.
(d) (i) neither Parent nor any RFS Company is, nor will be (A) a Pension
Plan; or (B) a "plan" within the meaning of Section 4975(e) of the Code; (ii)
the assets of Parent and its Subsidiaries do
Credit Agreement 38
not and will not constitute "plan assets" within the meaning of the United
States Department of Labor Regulations set forth in 29 C.F.R. (S)2510.3-101;
(iii) neither Parent nor any RFS Company is, nor will be a "governmental plan"
within the meaning of Section 3(32) of ERISA; (iv) transactions by or with
Parent or any RFS Company are not and will not be subject to state statutes
applicable to Parent and any RFS Company regulating investments of fiduciaries
with respect to governmental plans; and (v) neither Parent nor any RFS Company
shall engage in any transaction which would cause any obligation, or action
taken or to be taken, hereunder (or the exercise by Administrative Agent or any
Lender of any of its rights under this Agreement, any Note, or the other Loan
Documents) to be a non-exempt (under a statutory or administrative class
exemption) prohibited transaction under ERISA or Section 4975 of the Code.
Parent further agrees to deliver to Administrative Agent such certifications or
other evidence of compliance with the provisions of this Section 5.12 as
Administrative Agent may from time to time request.
Margin Regulations; Investment Company Act; Public Utility Holding Company
Act.
(a) Neither Parent nor any RFS Company is engaged, nor will it engage,
principally or as one of its important activities, in the business of purchasing
or carrying margin stock (within the meaning of Regulation U issued by the FRB),
or extending credit for the purpose of purchasing or carrying margin stock.
Following the application of the proceeds of each Borrowing, not more than
twenty-five percent (25%) of the value of the assets subject to the provisions
of Section 7.01 or Section 7.05 or subject to any restriction contained in any
agreement or instrument between either Borrower and any Lender or any Affiliate
of any Lender relating to Indebtedness and within the scope of Section 8.01(e)
will be margin stock.
(b) None of Parent, any RFS Company, any Person Controlling Parent or
Controlling any RFS Company (i) is a "holding company," or a "subsidiary
company" of a "holding company," or an "affiliate " of a "holding company" or of
a "subsidiary company" of a "holding company," within the meaning of the Public
Utility Holding Company Act of 1935, or (ii) is or is required to be registered
as an "investment company" under the Investment Company Act of 1940.
Disclosure. Parent and each RFS Company have disclosed to Administrative
Agent and Lenders all agreements, instruments, and corporate or other
restrictions to which it or any RFS Company is subject, and all other matters
known to it, that, individually or in the aggregate, could reasonably be
expected to result in a Material Adverse Effect. No report, financial statement,
certificate, or other information furnished (whether in writing or orally) by or
on behalf of any Loan Party to Administrative Agent or any Lender in connection
with the transactions contemplated hereby and the negotiation of this Agreement
or delivered hereunder (as modified or supplemented by other information so
furnished) contains any material misstatement of fact or omits to state any
material fact necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading; provided that, with
respect to projected financial information, Parent represents only that such
information was prepared in good faith based upon assumptions believed to be
reasonable at the time.
Compliance with Laws. Parent and each RFS Company are in compliance in all
material respects with the requirements of all Laws and all orders, writs,
injunctions, and decrees applicable to it or to its properties, except in such
instances in which (a) such requirement of Law or order, writ, injunction, or
decree is being contested in good faith by appropriate proceedings diligently
conducted or (b) the failure to comply therewith, either individually or in the
aggregate, could not reasonably be expected to have a Material Adverse Effect.
Tax Shelter Regulations. Neither Borrower intends to treat the Loans and
related transactions as being a "reportable transaction" (within the meaning of
Treasury Regulation Section 1.6011-4). In the event either Borrower determines
to take any action inconsistent with such intention, it will promptly notify
Administrative Agent thereof. If a Borrower so notifies Administrative Agent,
Borrowers
Credit Agreement 39
acknowledge that one or more of Lenders may treat its Loans as part of a
transaction that is subject to Treasury Regulation Section 301.6112-1, and such
Lender or Lenders, as applicable, will maintain the lists and other records
required by such Treasury Regulation.
Intellectual Property; Licenses; Etc. Parent and each RFS Company own, or
possess the right to use, all of the trademarks, service marks, trade names,
copyrights, patents, patent rights, franchises, licenses, and other intellectual
property rights (collectively, "IP Rights") that are reasonably necessary for
the operation of their respective businesses, without conflict with the rights
of any other Person. To the best knowledge of Parent, no slogan or other
advertising device, product, process, method, substance, part, or other material
now employed, or now contemplated to be employed, by Parent or its Subsidiaries
infringes upon any rights held by any other Person. No claim or litigation
regarding any of the foregoing is pending or, to the best knowledge of Parent,
threatened, which, either individually or in the aggregate, could reasonably be
expected to have a Material Adverse Effect.
Drainage/Condemnation/Zoning. The Improvements have not been damaged and
not repaired and are not the subject of any pending or threatened condemnation
or adverse zoning proceeding, except as could not reasonably be expected to
cause a Material Property Event or as specifically disclosed to Administrative
Agent in writing as of the Closing Date.
Property Condition. Except as otherwise disclosed to Administrative Agent
in writing (a) all Collateral Properties comply with all Laws, including all
subdivision and platting requirements, without reliance on any adjoining or
neighboring property except where the failure to comply could not reasonably be
expected to cause a Material Property Event, (b) the Improvements comply with
all Laws regarding access and facilities for handicapped or disabled persons
except where the failure to comply could not reasonably be expected to cause a
Material Property Event, (c) neither Parent nor any RFS Company has directly or
indirectly conveyed, assigned, or otherwise disposed of, or transferred (or
agreed to do so) any development rights, air rights, or other similar rights,
privileges, or attributes with respect to any Collateral Properties, including
those arising under any zoning or property use ordinance or other Law, (d) all
utility services necessary for the use of the Collateral Properties and the
Improvements and the operation thereof for their intended purpose are
satisfactory, (e) except as otherwise provided for in the Loan Documents,
neither Parent nor any RFS Company has made any contract or arrangement of any
kind the performance of which by the other party thereto would give rise to
Liens on the Collateral Properties, and (f) the current and anticipated use of
the Collateral Properties complies in all material respects with all applicable
zoning ordinances, regulations, and restrictive covenants affecting the
Collateral Properties without the existence of any variance, non-complying use,
nonconforming use, or other special exception, all use restrictions of any
Governmental Authority having jurisdiction have been satisfied, and no violation
of any Law or regulation exists with respect thereto except where the failure to
comply could not reasonably be expected to cause a Material Property Event.
Representations Concerning Leases. Borrowers have delivered to
Administrative Agent a true and correct copy of any major tenant leases and each
guarantee thereof (if any), affecting any material part of the Improvements and
in the possession or control of Parent, any of its Subsidiaries, or any
Operating Lessee which is an Affiliate of a Loan Party and have delivered all
Operating Leases and Ground Leases, together with property-level financial
information for the Collateral Properties, and no such Operating Lease, Ground
Lease, or other lease or guarantee contains any option to purchase all or any
portion of the Collateral Properties or any interest therein or contains any
right of first refusal relating to any sale of the Collateral Properties or any
portion thereof or interest therein.
Contracts and Plans. The copy of any construction, architectural design,
management, brokerage, or contract relating to the Collateral Properties
furnished or to be furnished to Administrative Agent is and shall be a true and
complete copy thereof, that the copies of the Plans delivered to
Credit Agreement 40
Administrative Agent are and shall be true and complete copies of the Plans as
are in the possession or control of Parent, any of its Subsidiaries, or any
Operating Lessee which is an Affiliate of a Loan Party, that there have been no
modifications thereof which are not fully set forth in the copies delivered, and
that Borrowers' respective interests therein are not subject to any claim,
setoff, or encumbrance, except as disclosed to Administrative Agent in writing.
Condemnation. No Condemnation or other proceeding has been commenced or, to
Parent's and Borrowers' knowledge, is threatened or contemplated with respect to
all or any portion of the Collateral Properties or for the relocation of
roadways providing access to the Collateral Properties except where such
Condemnation or other proceeding could not reasonably be expected to cause a
Material Property Event.
Reciprocal Agreements.
(a) Neither Borrower is currently in default in any respect (nor has any
notice been given or received with respect to an alleged or current default)
under any of the terms and conditions of any REA, and each REA remains
unmodified and in full force and effect except where such failure could not
reasonably be expected to cause a Material Property Event.
(b) All sums due and owing by either Borrower to the other parties to each
REA (or by the other parties to each REA to either Borrower) pursuant to the
terms of such REA, have been paid, are current, and no lien has attached on any
Collateral Property (or threat thereof been made) for failure to pay any of the
foregoing except where such failure could not reasonably be expected to cause a
Material Property Event.
Management Agreements. Each Management Agreement is in full force and
effect and there is no default or terminating event thereunder by any party
thereto and, to Parent's and Borrowers' knowledge, no event has occurred that,
with the passage of time and/or the giving of notice would constitute a default
or terminating event thereunder except for such defaults or terminating events
specifically disclosed to Administrative Agent in writing as of the Closing Date
or which could not reasonably be expected to cause a Material Property Event. No
management fees under any Management Agreement are accrued and unpaid except as
provided or permitted under the express terms of a Management Agreement.
Franchise Agreements. Each Franchise Agreement is in full force and effect
and there is no default or terminating event thereunder by any party thereto
and, to Parent's and Borrowers' knowledge, no event has occurred that, with the
passage of time and/or the giving of notice would constitute a default or
terminating event thereunder except for such defaults or terminating events
specifically disclosed to Administrative Agent in writing as of the Closing Date
or which could not reasonably be expected to cause a Material Property Event. As
of the date hereof, no unpaid fees are due and payable under any Franchise
Agreement, including, without limitation, all franchise fees, reservation fees,
and royalties.
Ground Lease Representations.
(a) Each Ground Lease is in full force and effect.
(b) There are no defaults or terminating events under any Ground Lease by
Borrowers, or, to Parent's and Borrowers' knowledge, any ground lessor
thereunder, and, to Parent's and Borrowers' knowledge, no event has occurred
which but for the passage of time, or notice, or both would constitute a default
or terminating event under any Ground Lease except for such defaults or
terminating events
Credit Agreement 41
specifically disclosed to Administrative Agent in writing as of the Closing Date
or which could not reasonably be expected to cause a Material Property Event.
(c) All rents, additional rents, and other sums due and payable under each
Ground Lease have been paid in full.
(d) Neither Borrower nor the ground lessor under any Ground Lease has
commenced any action or given or received any notice for the purpose of
terminating such Ground Lease which could not reasonably be expected to cause a
Material Property Event.
(e) Each Ground Lease or a memorandum thereof has been duly recorded. Each
Ground Lease permits the interest of Borrowers to be encumbered by a mortgage.
(f) Borrowers' interest in each Ground Lease is not subject to any Liens
or encumbrances superior to, or of equal priority with, the related Mortgage
other than the ground lessor's related fee interest and Liens for taxes not yet
due and payable and as otherwise set forth in the Title Insurance.
(g) Borrowers' interest in each Ground Lease is assignable to
Administrative Agent upon notice to, but without the consent of, the ground
lessor thereunder (or, if any such consent is required, it has been obtained
prior to the date hereof) except to the extent non-assignability could not
reasonably be expected to cause a Material Property Event.
5.27 Solvency. Each Loan Party is, and after giving effect to the Loans,
will be, Solvent.
5.28 Operating Leases.
(a) Each Operating Lease is in full force and effect and has not been
modified or amended in any manner whatsoever (with the exception of written
instruments which have been recorded).
(b) There are no defaults or terminating events under any Operating Lease
by Borrowers, or, to Parent's and Borrowers' knowledge, the Operating Lessee
thereunder, and, to Parent's and Borrowers' knowledge, no event has occurred
which but for the passage of time, or notice, or both would constitute a default
or terminating event under any Operating Lease except for such defaults or
terminating events specifically disclosed to Administrative Agent in writing as
of the Closing Date or which could not reasonably be expected to cause a
Material Property Event.
(c) All rents, additional rents, and other sums due and payable under each
Operating Lease have been paid in full.
(d) Neither Borrower nor the Operating Lessee under any Operating Lease
has commenced any action or given or received any notice for the purpose of
terminating such Operating Lease which could not reasonably be expected to cause
a Material Property Event.
5.29 Knowledge. Each representation or warranty made in Sections 5.09,
5.18, 5.19, 5.20, 5.21, 5.22, 5.23, 5.24, 5.25, 5.26, and 5.28 with respect to
any Property shall be, to the extent not already specified, deemed made to the
best of Parent's and each RFS Company's knowledge after due inquiry. Such
knowledge of any RFS Company shall be based upon the new officers and
representative individuals therefore as of the Closing Date, and shall not be
imputed from any knowledge of the prior representatives.
Credit Agreement 42
AFFIRMATIVE COVENANTS
So long as any Lender shall have any Commitment hereunder, or any Loan or
other Obligations hereunder shall remain unpaid or unsatisfied:
Financial Statements. Parent and Operating Company shall deliver to
Administrative Agent and each Lender, in form and detail satisfactory to
Administrative Agent and the Required Lenders:
(a) as soon as available, but in any event within ninety (90) days after
the end of each fiscal year of Operating Company, a consolidated balance sheet
of Operating Company and its Subsidiaries as at the end of such fiscal year, and
the related consolidated statements of income or operations, shareholders'
equity, and cash flows for such fiscal year, setting forth in each case in
comparative form the figures for the previous fiscal year, all in reasonable
detail and prepared in accordance with GAAP, audited and accompanied by a report
and opinion of an independent certified public accountant of nationally
recognized standing reasonably acceptable to the Required Lenders, which report
and opinion shall be prepared in accordance with generally accepted auditing
standards and shall not be subject to any "going concern" or like qualification
or exception or any qualification or exception as to the scope of such audit;
(b) as soon as available, but in any event within ninety (90) days after
the end of each fiscal year of Parent, a consolidated balance sheet of Parent
and its Subsidiaries as at the end of such fiscal year, and the related
consolidated statements of income or operations, shareholders' equity, and cash
flows for such fiscal year, setting forth in each case in comparative form the
figures for the previous fiscal year, all in reasonable detail and prepared in
accordance with GAAP, audited and accompanied by a report and opinion of an
independent certified public accountant of nationally recognized standing
reasonably acceptable to the Required Lenders, which report and opinion shall be
prepared in accordance with generally accepted auditing standards and shall not
be subject to any "going concern" or like qualification or exception or any
qualification or exception as to the scope of such audit;
(c) as soon as available, but in any event within forty-five (45) days
after the end of each of the first three fiscal quarters of each fiscal year of
Operating Company, a consolidated balance sheet of Operating Company and its
Subsidiaries as at the end of such fiscal quarter, and the related consolidated
statements of income or operations, shareholders' equity and cash flows for such
fiscal quarter and for the portion of Operating Company's fiscal year then
ended, setting forth in each case in comparative form the figures for the
corresponding fiscal quarter of the previous fiscal year and the corresponding
portion of the previous fiscal year, all in reasonable detail and certified by a
Responsible Officer of Operating Company as fairly presenting the financial
condition, results of operations, shareholders' equity and cash flows of
Operating Company and its Subsidiaries in accordance with GAAP, subject only to
normal year-end audit adjustments and the absence of footnotes;
(d) as soon as available, but in any event within forty-five (45) days
after the end of each of the first three fiscal quarters of each fiscal year of
Parent, a consolidated balance sheet of Parent and its Subsidiaries as at the
end of such fiscal quarter, and the related consolidated statements of income or
operations, shareholders' equity and cash flows for such fiscal quarter and for
the portion of Parent's fiscal year then ended, setting forth in each case in
comparative form the figures for the corresponding fiscal quarter of the
previous fiscal year and the corresponding portion of the previous fiscal year,
all in reasonable detail and certified by a Responsible Officer of Parent as
fairly presenting the financial condition, results of operations, shareholders'
equity and cash flows of Parent and its Subsidiaries in accordance with GAAP,
subject only to normal year-end audit adjustments and the absence of footnotes;
and
Credit Agreement 43
(e) from time to time promptly after Administrative Agent's request, such
additional information, reports, and statements respecting the Collateral
Properties and the Improvements, or the business operations and financial
condition of each reporting party, as Administrative Agent may reasonably
request.
As to any information contained in materials furnished pursuant to Section 6.02,
Parent and/or Operating Company shall not be separately required to furnish such
information under clauses (a), (b), (c), or (d) above, but the foregoing shall
not be in derogation of the obligations of Parent and/or Operating Company to
furnish the information and materials described in clauses (a) through (d) above
at the times specified therein.
Certificates; Other Information. Parent and Borrowers shall deliver to
Administrative Agent and each Lender, in form and detail satisfactory to
Administrative Agent and the Required Lenders:
(a) concurrently with the delivery of the financial statements referred to
in Section 6.01(a) and (b), a certificate of independent certified public
accountants certifying such financial statements and stating that in making the
examination necessary therefor no knowledge was obtained of any Default or, if
any such Default shall exist, stating the nature and status of such event;
(b) concurrently with the delivery of the financial statements referred to
in Sections 6.01(a), (b), (c) and (d), a duly completed Compliance Certificate
signed by a Responsible Officer of Parent or Operating Company, as applicable;
(c) promptly after any request by Administrative Agent or any Lender,
copies of any detailed audit reports, management letters, or major
recommendations submitted to the board of directors (or the audit committee of
the board of directors) of Parent or Operating Company by independent
accountants in connection with the accounts or books of Parent, Operating
Company, or any Subsidiary of Operating Company, or any audit of any of them;
(d) promptly after the same are available, copies of each annual report,
proxy, or financial statement or other report or communication sent to the
stockholders of Parent, and copies of all annual, regular, periodic, and special
reports and registration statements which Parent or Operating Company may file
or be required to file with the SEC under Section 13 or 15(d) of the Securities
Exchange Act of 1934, and not otherwise required to be delivered to
Administrative Agent pursuant hereto;
(e) promptly after either Borrower has notified Administrative Agent of
any intention by such Borrower to treat the Loans and related transactions as
being a "reportable transaction" (within the meaning of Treasury Regulation
Section 1.6011-4), a duly completed copy of IRS Form 8886 or any successor form;
and
(f) promptly, such additional information regarding the business,
financial, or corporate affairs of Parent or any Subsidiary, or compliance with
the terms of the Loan Documents, as Administrative Agent or any Lender may from
time to time reasonably request.
Documents required to be delivered pursuant to Sections 6.01(a) through (f)
(to the extent any such documents are included in materials otherwise filed with
the SEC) may be delivered electronically and if so delivered, shall be deemed to
have been delivered on the date (i) on which Parent, Operating Company, or
either Borrower, as applicable, posts such documents, or provides a link thereto
on it's website on the Internet at the website address listed on Schedule 10.02,
or (ii) on which such documents are posted on Parent's, Operating Company's, or
either Borrower's behalf on IntraLinks/IntraAgency or another relevant website,
if any, to which each Lender and Administrative Agent have access (whether a
Credit Agreement 44
commercial, third-party website, or whether sponsored by Administrative Agent);
provided that: (i) paper copies of such documents shall be provided to
Administrative Agent or any Lender that requests delivery of such paper copies
until a written request to cease delivering paper copies is given by
Administrative Agent or such Lender and (ii) Parent, Operating Company, or
either Borrower, as applicable, shall notify (which may be by facsimile or
electronic mail) Administrative Agent and each Lender of the posting of any such
documents and provide to Administrative Agent by electronic mail electronic
versions (i.e., soft copies) of such documents. Notwithstanding anything
contained herein, in every instance Parent and Operating Company shall be
required to provide paper copies of the Compliance Certificates required by
Section 6.02(b) to Administrative Agent and each of the Lenders. Except for such
Compliance Certificates, Administrative Agent shall have no obligation to
request the delivery or to maintain copies of the documents referred to above,
and in any event shall have no responsibility to monitor compliance by Parent,
Operating Company, or either Borrower with any such request for delivery, and
each Lender shall be solely responsible for requesting delivery to it or
maintaining its copies of such documents.
Notices.
Notice Requirements. Parent and Borrowers shall promptly notify
Administrative Agent and each Lender of:
(a) the occurrence of any Default;
(b) any matter that has resulted or could reasonably be expected to
result in a Material Adverse Effect, including (i) breach or non-performance of,
or any default under, a Contractual Obligation of Parent or any RFS Company,
(ii) any dispute, litigation, investigation, proceeding, or suspension between
Parent or any RFS Company and any Governmental Authority, or (iii) the
commencement of, or any material development in, any litigation or proceeding
affecting Parent or any RFS Company, including pursuant to any applicable
Environmental Laws;
(c) the occurrence of any ERISA Event;
(d) any material change in accounting policies or financial reporting
practices by Parent or any RFS Company;
(e) any litigation, arbitration, or governmental investigation or
proceeding instituted or threatened against any Collateral Property, and any
material development therein;
(f) any actual or threatened condemnation of any material portion of
any Collateral Property, any negotiations with respect to any such taking, or
any loss of or substantial damage to the Collateral Property;
(g) any labor controversy pending or threatened against Parent, any RFS
Company, or any material contractor, and any material development in any labor
controversy;
(h) any notice received by either Borrower with respect to the
cancellation, alteration, or non-renewal of any required insurance coverage
maintained with respect to any Collateral Property;
(i) any required and material permit, license, certificate, or approval
with respect to the Collateral Property lapses or ceases to be in full force and
effect;
(j) any claim from any person that any Collateral Property, or any use,
activity, operation, or maintenance thereof or thereon, is not in material
compliance with any Law; or
Credit Agreement 45
(k) any Disposition of any Property by any RFS Company other than as
permitted by Sections 7.05(a), (b), or (c).
Each notice pursuant to this Section 6.03 shall be accompanied by a statement of
a Responsible Officer of Parent setting forth details of the occurrence referred
to therein and stating what action Parent or any RFS Company, as applicable,
have taken and proposes to take with respect thereto. Each notice pursuant to
Section 6.03(a) shall describe with particularity any and all provisions of this
Agreement and any other Loan Document that have been breached.
Payment of Obligations. Parent and Borrowers shall, and shall cause each
other RFS Company to, pay and discharge as the same shall become due and
payable, all its obligations and liabilities, including (a) all tax liabilities,
assessments, and governmental charges or levies upon it or its properties or
assets, unless the same are being contested in good faith by appropriate
proceedings diligently conducted and adequate reserves in accordance with GAAP
are being maintained by Parent or any RFS Company, (b) all lawful claims which,
if unpaid, would by law become a Lien upon its property, and (c) all
Indebtedness, as and when due and payable, but subject to any subordination
provisions contained in any instrument or agreement evidencing such
Indebtedness.
Preservation of Existence, Etc. Parent and Borrowers shall, and shall
cause each other RFS Company to, (a) preserve, renew, and maintain in full force
and effect its legal existence and good standing under the Laws of the
jurisdiction of its organization except in a transaction permitted by Section
7.04 or 7.05, (b) take all reasonable action to maintain all rights, privileges,
permits, licenses, and franchises necessary or desirable in the normal conduct
of its business, except to the extent that failure to do so could not reasonably
be expected to have a Material Adverse Effect, and (c) preserve or renew all of
its registered patents, trademarks, trade names, and service marks, the
non-preservation of which could reasonably be expected to have a Material
Adverse Effect.
Maintenance of Properties. Parent and Borrowers shall, and shall cause
each other RFS Company to, (a) maintain, preserve, and protect all of its
material properties and equipment necessary in the operation of its business in
good working order and condition, ordinary wear and tear excepted, and (b) make
all necessary repairs thereto and renewals and replacements thereof except where
the failure to do so could not reasonably be expected to have a Material Adverse
Effect.
Maintenance of Insurance. (a) Parent and Borrowers shall, and shall
cause each other RFS Company to, obtain and maintain, or cause to be maintained,
at all times insurance for itself and its Properties under valid and enforceable
policies (collectively, the "Policies" or in the singular, the "Policy"), in
form and substance acceptable Administrative Agent. Any new Policies for
Collateral Properties shall be issued by financially sound and responsible
insurance companies authorized to do business in the State and having a claims
paying ability rating of "AA" or better by at least two (2) debt rating
agencies, one of which must be S&P or such other debt rating agencies approved
by Administrative Agent. The Policies for Collateral Properties shall designate
Administrative Agent and its successors and assigns as additional insureds,
mortgagees and/or loss payee as deemed appropriate by Administrative Agent. Not
less than ten (10) days prior to the expiration dates of the Policies
theretofore furnished to Administrative Agent, renewal Policies accompanied by
evidence satisfactory to Administrative Agent of payment of the premiums due
thereunder (the "Insurance Premiums") shall be delivered by Borrowers to
Administrative Agent.
(b) All Policies provided for or contemplated by Section 6.07(a) with
respect to Collateral Properties shall name the applicable Borrower as the
insured and Administrative Agent as the additional insured, as its interests may
appear, and in the case of property damage, boiler, and machinery, flood and
earthquake insurance, shall contain a so-called New York standard
non-contributing mortgagee clause in
Credit Agreement 46
favor of Administrative Agent providing that the loss thereunder shall be
payable to Administrative Agent. Administrative Agent shall not be liable for
any insurance premiums thereon or subject to any assessments thereunder.
(c) All Policies for Collateral Properties provided for in Section
6.07(a) with respect to Borrowers or the Collateral Properties shall contain
clauses or endorsements to the effect that:
(i) no act or negligence of the applicable Borrower, or anyone
acting for such Borrower, or of any tenant or other occupant, or failure to
comply with the provisions of any Policy, which might otherwise result in a
forfeiture of the insurance or any part thereof, shall in any way affect the
validity or enforceability of the insurance insofar as Administrative Agent is
concerned;
(ii) the Policies shall not be materially changed (other than
to increase the coverage provided thereby) or canceled without at least thirty
(30) days' prior written notice to Administrative Agent and any other party
named therein as an additional insured;
(iii) the issuers thereof shall give written notice to
Administrative Agent if the Policies have not been renewed thirty (30) days
prior to its expiration; and
(iv) the Policies do not contain an exclusion for acts of
terror or similar acts of sabotage.
(d) If at any time Administrative Agent is not in receipt of written
evidence that all insurance required hereunder is in full force and effect,
Administrative Agent shall have the right, without notice to Borrowers, to take
such action as Administrative Agent deems necessary to protect its interest in
the Collateral Properties, including, without limitation, obtaining such
insurance coverage as Administrative Agent in its sole discretion deems
appropriate. All premiums incurred by Administrative Agent in connection with
such action or in obtaining such insurance and keeping it in effect shall be
paid by Borrowers to Administrative Agent upon demand and, until paid, shall be
secured by the Mortgages and shall bear interest at the Default Rate.
Compliance with Laws. Parent and Borrowers shall, and shall cause each
other RFS Company to, comply in all material respects with the requirements of
all Laws and all orders, writs, injunctions, and decrees applicable to it or to
its business or property, except in such instances in which (a) such requirement
of Law or order, write, injunction, or decree is being contested in good faith
by appropriate proceedings diligently conducted, or (b) the failure to comply
therewith could not reasonably be expected to have a Material Adverse Effect.
Books and Records. Parent and Borrowers shall, and shall cause each
other RFS Company to, maintain proper books of record and account, in which
full, true, and correct entries in conformity with GAAP consistently applied
shall be made of all financial transactions and matters involving the assets and
business of Parent or RFS Companies, as the case may be.
Inspection Rights. Parent and Borrowers shall, and shall cause each
other RFS Company to, permit representatives and independent contractors of
Administrative Agent and each Lender to visit and inspect their respective
Properties and any materials at any reasonable time (unless they deem such
inspection is of an emergency nature, in which event Parent and Borrowers shall
provide them with immediate access to the Properties) to examine its corporate,
financial, and operating records, and make copies thereof or abstracts
therefrom, and to discuss its affairs, finances, and accounts with its
directors, officers, and independent public accountants, all at the expense of
Borrowers and at such reasonable times during normal business hours and as often
as may be reasonably desired, upon reasonable advance notice
Credit Agreement 47
to Parent and Borrowers; provided, however, that when an Event of Default exists
Administrative Agent or any Lender (or any of their respective representatives
or independent contractors) may do any of the foregoing at the expense of
Borrowers at any time during normal business hours and without advance notice.
Parent and Borrowers will furnish to Administrative Agent and its agents for
inspection and copying, all Plans, shop drawings, specifications, books, and
records, and other documents and information in their possession or control that
Administrative Agent may reasonably request from time to time.
Use of Proceeds. Parent and Borrowers shall, and shall cause each other
RFS Company to, (a) use the proceeds of the Tranche A Loans (i) to refinance the
outstanding principal amount of existing Indebtedness of Operating Company under
the Existing Credit Agreement and to redeem or with Administrative Agent's prior
written consent acquire a portion of the Senior Notes, (ii) to distribute to pay
a portion of the consideration for the Merger Transactions, (iii) to distribute
to Parent, Acquisition Sub, and/or Operating Company to pay fees and expenses
incurred in connection with the Merger Transactions in an amount not to exceed
$60,000,000, and (iv) for other lawful purposes in an amount not to exceed the
difference between $145,000,000 and the amount of the initial Loan made on the
Closing Date, and (b) distribute the proceeds of the Tranche B Loans to
Operating Company to redeem or with Administrative Agent's prior written consent
acquire a portion of the Senior Notes.
Other Property Information. Parent and Borrowers shall furnish to
Administrative Agent from time to time upon Administrative Agent's request
budgets of each Borrower and revisions thereof showing the estimated costs and
expenses to be incurred in connection with the Collateral Properties and such
other information in their possession or control or in the possession or control
of an Operating Lessee which is an Affiliate of any Loan Party relating to the
Improvements or the Collateral Properties.
Reports and Testing. Parent and Borrowers shall promptly (a) deliver to
Administrative Agent copies of all reports, studies, inspections, and tests made
on the Collateral Properties, the Improvements, or any materials to be
incorporated into the Improvements, and (b) make such additional tests on the
Collateral Properties, the Improvements, or any materials to be incorporated
into the improvements as Administrative Agent reasonably requires. Borrowers
shall immediately notify Administrative Agent of any report, study, inspection,
or test that indicates any material adverse condition relating to the Collateral
Properties, the Improvements, or any such materials which reasonably could
result in a Material Property Event.
Environmental Matters. Parent and Borrowers shall, and shall cause each
other RFS Company to:
(a) Violations. Not cause, commit, permit, or allow to continue (i) any
violation of any Environmental Requirement which could reasonably be expected to
cause a Material Property Event: (A) by either Borrower or by any Person; and
(B) by or with respect to the Collateral Properties or any use of or condition
or activity on the Collateral Properties, or (ii) the attachment of any
environmental liens to the Collateral Properties. Neither Borrower will place,
install, dispose of, or release, or cause, permit, or allow the placing,
installation, disposal, spilling, leaking, dumping, or release of, any Hazardous
Material or storage tank (or similar vessel) on the Collateral Properties and
will keep the Collateral Properties free of Hazardous Material to the extent
such action could reasonably be expected to cause a Material Property Event.
(b) Notice to Administrative Agent. Promptly deliver to Administrative
Agent a copy of each report pertaining to any Collateral Property or to either
Borrower prepared by or on behalf of such Borrower pursuant to any Environmental
Requirement. Borrowers shall immediately advise Administrative Agent in writing
of any Environmental Claim or of the discovery of any Hazardous
Credit Agreement 48
Material on any Collateral Property, as soon as either Borrower first obtains
knowledge thereof, including a full description of the nature and extent of the
Environmental Claim and/or Hazardous Material and all relevant circumstances.
(c) Site Assessments and Information. If Administrative Agent shall
ever have reason to believe that any Hazardous Material affects any Collateral
Property, or if any Environmental Claim is made or threatened, if requested by
Administrative Agent, at Borrowers' expense, provide to Administrative Agent
from time to time, in each case within thirty (30) days after Administrative
Agent's request, an Environmental Assessment (hereinafter defined) made after
the date of Administrative Agent's request. As used in this Agreement, the term
"Environmental Assessment" means a report (including all drafts thereof) of an
environmental assessment of such Collateral Property and of such scope
(including but not limited to the taking of soil borings and air and groundwater
samples and other above and below ground testing) as Administrative Agent may
reasonably request, by a consulting firm acceptable to Administrative Agent and
made in accordance with Administrative Agent's established guidelines. Borrowers
will cooperate with each consulting firm making any such Environmental
Assessment and will supply to the consulting firm, from time to time and
promptly on request, all information available to Borrowers to facilitate the
completion of the Environmental Assessment. If Borrowers fail to furnish
Administrative Agent within ten (10) days after Administrative Agent's request
with a copy of an agreement with an acceptable environmental consulting firm to
provide such Environmental Assessment, or if Borrowers fail to furnish to
Administrative Agent such Environmental Assessment within thirty (30) days after
Administrative Agent's request, Administrative Agent may cause any such
Environmental Assessment to be made at Borrowers' expense and risk.
Administrative Agent and its designees are hereby granted access to the
Collateral Properties at any time or times, upon reasonable notice (which may be
written or oral), and a license which is coupled with an interest and
irrevocable, to make or cause to be made such Environmental Assessments.
Administrative Agent may disclose to interested parties any information
Administrative Agent ever has about the environmental condition or compliance of
the Collateral Properties, but shall be under no duty to disclose any such
information except as may be required by Law. Administrative Agent shall be
under no duty to make any Environmental Assessment of the Collateral Properties,
and in no event shall any such Environmental Assessment by Administrative Agent
be or give rise to a representation that any Hazardous Material is or is not
present on the Collateral Properties, or that there has been or shall be
compliance with any Environmental Requirement, nor shall Borrowers or any other
person be entitled to rely on any Environmental Assessment made by
Administrative Agent or at Administrative Agent's request. Neither
Administrative Agent nor any Lender owes any duty of care to protect Borrowers
or any other Person against, or to inform them of, any Hazardous Material or
other adverse condition affecting the Collateral Properties.
(d) Remedial Actions. If any Hazardous Material is discovered on any
Collateral Property at any time and regardless of the cause, (i) promptly at
Borrowers' sole risk and expense remove, treat, and dispose of the Hazardous
Material in compliance with all applicable Environmental Requirements and solely
under the applicable Borrower's name (or if removal is prohibited by any
Environmental Requirement, take whatever action is required by any Environmental
Requirement), in addition to taking such other action as is necessary to have
the full use and benefit of such Collateral Property as contemplated by the Loan
Documents, and provide Administrative Agent with satisfactory evidence thereof,
and (ii) if requested by Administrative Agent, provide to Administrative Agent
within thirty (30) days of Administrative Agent's request a bond, letter of
credit, or other financial assurance evidencing to Administrative Agent's
satisfaction that all necessary funds are readily available to pay the costs and
expenses of the actions required by subsection (i) preceding and to discharge
any assessments or liens established against such Collateral Property as a
result of the presence of the Hazardous Material on the Collateral Property.
Within fifteen (15) days after completion of such remedial actions, Borrowers
shall obtain and deliver to Administrative Agent an Environmental Assessment of
such Collateral Property
Credit Agreement 49
made after such completion and confirming to Administrative Agent's satisfaction
that all required remedial action as stated above has been taken and
successfully completed and that there is no evidence or suspicion of any
contamination or risk of contamination on the Collateral Property or any
adjacent property, or of violation of any Environmental Requirement, with
respect to any such Hazardous Material. Administrative Agent on behalf of
Lenders may, but shall never be obligated to, remove or cause the removal of any
Hazardous Material from the Collateral Property (or if removal is prohibited by
any Environmental Requirement, take or cause the taking of such other action as
is required by any Environmental Requirement) if Borrowers fails to promptly
commence such remedial actions following discovery and thereafter diligently
prosecute the same to the satisfaction of Administrative Agent (without
limitation of the rights of Administrative Agent on behalf of Lenders to declare
an Event of Default and to exercise all rights and remedies available by reason
thereof); and Administrative Agent and its designees are hereby granted access
to the Collateral Properties at any time or times, upon reasonable notice (which
may be written or oral), and a license which is coupled with an interest and
irrevocable, to remove or cause such removal or to take or cause the taking of
any such other action.
Contracts. Parent and Borrowers shall, and shall cause each other RFS
Company to, perform all of their obligations under any construction,
architectural design, management, brokerage, or contract relating to the
Properties unless the failure to perform could not reasonably be expected to
cause a Material Property Event.
Casualty. If any Collateral Property shall be damaged or destroyed, in
whole or in part, by fire or other casualty (a "Casualty"), Borrowers shall give
prompt notice of such damage to Administrative Agent and shall promptly cause
Operating Lessee of such Collateral Property to commence and diligently
prosecute the Restoration of such Collateral Property in accordance with Section
6.18, so long as Administrative Agent makes any Net Proceeds available pursuant
to Section 6.18. Borrowers shall pay all costs of such Restoration whether or
not such costs are covered by insurance. Administrative Agent may, but shall not
be obligated to make proof of loss if not made promptly by Borrowers. Borrowers
shall adjust all claims for Insurance Proceeds in consultation with, and
approval of, Administrative Agent; provided, however, if an Event of Default has
occurred and is continuing, Administrative Agent shall have the exclusive right
to participate in the adjustment of all claims for Insurance Proceeds.
Condemnation. Borrowers shall promptly cause each Operating Lessee to
give Administrative Agent notice of the actual or threatened commencement of any
proceeding for the Condemnation of any Collateral Property of which any
Operating Lessee has knowledge and cause such Operating Lessee to deliver to
Administrative Agent copies of any and all papers served in connection with such
proceedings. Administrative Agent may participate in any such proceedings, and
Borrowers shall from time to time deliver to Administrative Agent all
instruments requested by it to permit such participation. Borrowers shall, at
their expense, cause Operating Lessee to diligently prosecute any such
proceedings, and shall consult with Administrative Agent, its attorneys, and
experts, and cooperate with them in the carrying on or defense of any such
proceedings. Notwithstanding any taking by any public or quasi-public authority
through Condemnation or otherwise (including but not limited to any transfer
made in lieu of or in anticipation of the exercise of such taking), Borrowers
shall continue to pay the Obligations at the time and in the manner provided for
herein and the Obligations shall not be reduced until any Award shall have been
actually received and applied by Administrative Agent, after the deduction of
expenses of collection, to the reduction or discharge of the Obligations.
Administrative Agent shall not be limited to the interest paid on the Award by
the condemning authority but shall be entitled to receive out of the Award
interest at the rate or rates provided herein. If any Collateral Property or any
portion thereof is taken by a condemning authority, Borrowers shall or shall
cause the Operating Lessee thereof to promptly commence and diligently prosecute
the Restoration of such Collateral Property and otherwise comply with the
provisions of Section 6.18, provided that Administrative Agent makes any Net
Proceeds available pursuant to Section 6.18(b). If any Collateral Property is
sold, through foreclosure or otherwise,
Credit Agreement 50
prior to the receipt by Administrative Agent of the Award, Administrative Agent
shall have the right, whether or not a deficiency judgment shall have been
sought, recovered, or denied, to receive the Award, or a portion thereof
sufficient to pay the Obligations.
Restoration. The following provisions shall apply in connection with the
Restoration of any Collateral Property:
(a) If the Net Proceeds shall be less than $5,000,000 and the costs of
completing the Restoration shall be less than $5,000,000, the Net Proceeds will
be disbursed by Administrative Agent to Borrowers upon receipt, provided that
all of the conditions set forth in Section 6.18(b)(i) are met and Borrowers
deliver to Administrative Agent a written undertaking to expeditiously commence
and to satisfactorily complete with due diligence the Restoration in accordance
with the terms of this Agreement.
(b) If the Net Proceeds are equal to or greater than $5,000,000 or the
costs of completing the Restoration are equal to or greater than $5,000,000,
Administrative Agent shall make the Net Proceeds available for the Restoration
in accordance with the provisions of this Section 6.18. The term "Net Proceeds"
for purposes of this Section 6.18 shall mean: (i) the net amount of all
insurance proceeds received by Administrative Agent pursuant to Section 6.07 as
a result of a Casualty, after deduction of its reasonable costs and expenses
(including, but not limited to, reasonable counsel fees), if any, in collecting
the same ("Insurance Proceeds"); or (ii) the net amount of the Award as a result
of a Condemnation, after deduction of its reasonable costs and expenses
(including, but not limited to, reasonable counsel fees), if any, in collecting
the same ("Condemnation Proceeds"), whichever the case may be.
(i) The Net Proceeds shall be made available to Borrowers and the
applicable Operating Lessee for Restoration provided that each of the
following conditions are met:
(A) no Default shall have occurred and be continuing;
(B) (1) in the event the Net Proceeds are Insurance Proceeds, less
than twenty-five percent (25%) of the total floor area of
the Improvements on the Collateral Property has been
damaged, destroyed, or rendered unusable as a result of a
Casualty or (2) in the event the Net Proceeds are
Condemnation Proceeds, less than ten percent (10%) of the
land constituting the Collateral Property is taken, such
land is located along the perimeter or periphery of the
Collateral Property, and no portion of the Improvements is
located on such land;
(C) (1) no termination or termination option is caused (unless
waived) under the applicable Operating Lease, Management
Agreement, or Franchise Agreement and (2) the number of
guest rooms is not reduced by more than twenty-five percent
(25%);
(D) Administrative Agent shall be satisfied that any operating
deficits, including all scheduled payments of principal and
interest hereunder, which will be incurred with respect to
the Collateral Property as a result of the occurrence of
any such Casualty or Condemnation, whichever the case may
be, will be covered out of the insurance coverage referred
to in Section 6.07(a) above or other security provided by
Borrowers;
(E) Administrative Agent shall be satisfied that the
Restoration will be completed twelve (12) months after
commencement of the Restoration;
Credit Agreement 51
(F) the Collateral Property and the use thereof after the
Restoration will be in compliance with and permitted under
all Laws;
(G) Borrowers or the applicable Operating Lessee shall cause the
Restoration to be done and completed in an expeditious and
diligent fashion and in compliance with all applicable Laws
or any applicable Franchise Agreement;
(H) such Casualty or Condemnation, as applicable, does not result
in the loss of access to the Collateral Property or the
Improvements;
(I) Borrowers shall deliver, or cause to be delivered, to
Administrative Agent a signed detailed budget approved in
writing by Borrowers' or Operating Lessee's architect or
engineer stating the entire cost of completing the
Restoration, which budget shall be acceptable to
Administrative Agent;
(J) the Net Proceeds together with any cash or cash equivalent
deposited by Borrowers with Administrative Agent are
sufficient in Administrative Agent's reasonable judgment to
cover the cost of the Restoration; and
(K) the applicable Franchise Agreement is not terminated as a
result of a Casualty or a Condemnation.
(ii) The Net Proceeds shall be held by Administrative Agent until
disbursements commence, and, until disbursed in accordance with the
provisions of this Section 6.18, shall constitute additional security
for the Obligations. The Net Proceeds shall be disbursed by
Administrative Agent to, or as directed by, Borrowers from time to time
during the course of the Restoration, upon receipt of evidence
satisfactory to Administrative Agent that (A) all the conditions
precedent to such advance, including those set forth in Section
6.18(b)(i), have been satisfied, (B) all materials installed and work
and labor performed (except to the extent that they are to be paid for
out of the requested disbursement) in connection with the related
Restoration item have been paid for in full, and (C) there exist no
notices of pendency, stop orders, mechanic's or materialman's liens, or
notices of intention to file same, or any other liens or encumbrances of
any nature whatsoever on the Collateral Property which have not either
been fully bonded to the satisfaction of Administrative Agent and
discharged of record or in the alternative fully insured to the
satisfaction of Administrative Agent by the Title Insurer.
(iii) All plans and specifications required in connection with the
Restoration shall be subject to prior review and acceptance in all
respects by Administrative Agent and by an independent consulting
engineer selected by Administrative Agent (the "Restoration
Consultant"). Administrative Agent shall have the use of the plans and
specifications and all permits, licenses and approvals required or
obtained in connection with the Restoration. The identity of the
contractors, subcontractors, and materialmen engaged in the Restoration,
as well as the contracts in excess of $500,000 under which they have
been engaged, shall be subject to prior review and acceptance by
Administrative Agent and the Restoration Consultant. All costs and
expenses incurred by Administrative Agent in connection with making the
Net Proceeds available for the Restoration, including, without
limitation, reasonable counsel fees and disbursements and the
Restoration Consultant's fees, shall be paid by Borrowers.
(iv) In no event shall Administrative Agent be obligated to make
disbursements of the Net Proceeds in excess of an amount equal to the
costs actually incurred from time to time for work in place as part of
the Restoration, as certified by the Restoration Consultant, minus the
Credit Agreement 52
Restoration Retainage. The term "Restoration Retainage" shall mean an
amount equal to ten percent (10%) of the costs actually incurred for
work in place as part of the Restoration, as certified by the
Restoration Consultant, until the Restoration has been completed. The
Restoration Retainage shall be reduced to five percent (5%) of the costs
incurred upon receipt by Administrative Agent of satisfactory evidence
that fifty percent (50%) of the Restoration has been completed. The
Restoration Retainage shall in no event, and notwithstanding anything to
the contrary set forth above in this Section 6.18(b), be less than the
amount actually held back by Borrowers or the applicable Operating
Lessee, as applicable, from contractors, subcontractors, and materialmen
engaged in the Restoration. The Restoration Retainage shall not be
released until the Restoration Consultant certifies to Administrative
Agent that the Restoration has been completed in accordance with the
provisions of this Section 6.18(b) and that all approvals necessary for
the re-occupancy and use of the Collateral Property have been obtained
from all appropriate Governmental Authorities, and Administrative Agent
receives evidence satisfactory to Administrative Agent that the costs of
the Restoration have been paid in full or will be paid in full out of
the Restoration Retainage; provided, however, that Administrative Agent
will release the portion of the Restoration Retainage being held with
respect to any contractor, subcontractor, or materialman engaged in the
Restoration as of the date upon which the Restoration Consultant
certifies to Administrative Agent that the contractor, subcontractor or
materialman has satisfactorily completed all work and has supplied all
materials in accordance with the provisions of the contractor's,
subcontractor's, or materialman's contract, the contractor,
subcontractor, or materialman delivers the lien waivers and evidence of
payment in full of all sums due to the contractor, subcontractor, or
materialman as may be reasonably requested by Administrative Agent or by
the title company issuing the Title Insurance, and Administrative Agent
receives an endorsement to the Title Insurance insuring the continued
priority of the lien of the applicable Mortgage and evidence of payment
of any premium payable for such endorsement. If required by
Administrative Agent, the release of any such portion of the Restoration
Retainage shall be approved by the surety company, if any, which has
issued a payment or performance bond with respect to the contractor,
subcontractor, or materialman.
(v) Administrative Agent shall not be obligated to make
disbursements of the Net Proceeds more frequently than once every
calendar month.
(vi) If at any time the Net Proceeds or the undisbursed balance
thereof shall not, in the reasonable opinion of Administrative Agent in
consultation with the Restoration Consultant, be sufficient to pay in
full the balance of the costs which are estimated by the Restoration
Consultant to be incurred in connection with the completion of the
Restoration, Borrowers shall, and Parent and Borrowers shall cause the
applicable Operating Lessee to, as applicable, deposit the deficiency
(the "Net Proceeds Deficiency") with Administrative Agent before any
further disbursement of the Net Proceeds shall be made. The Net Proceeds
Deficiency deposited with Administrative Agent shall be held by
Administrative Agent and shall be disbursed for costs actually incurred
in connection with the Restoration on the same conditions applicable to
the disbursement of the Net Proceeds, and until so disbursed pursuant to
this Section 6.18(b) shall constitute additional security for the
Obligations.
(vii) The excess, if any, of the Net Proceeds and the remaining
balance, if any, of the Net Proceeds Deficiency deposited with
Administrative Agent after the Restoration Consultant certifies to
Administrative Agent that the Restoration has been completed in
accordance with the provisions of this Section 6.18(b), and the receipt
by Administrative Agent of evidence satisfactory to Administrative Agent
that all costs incurred in connection with the Restoration have been
paid in full, shall be remitted by Administrative Agent to Borrowers,
provided no Default shall have occurred and shall be continuing.
Credit Agreement 53
(c) All Net Proceeds not required (i) to be made available for the
Restoration or (ii) to be returned to Borrowers as excess Net Proceeds pursuant
to Section 6.18(b)(vii) may (x) be retained and applied by Administrative Agent
toward the payment of the Obligations whether or not then due and payable in
such order, priority, and proportions as Administrative Agent in its sole
discretion shall deem proper, or, (y) at the sole discretion of Administrative
Agent, the same may be paid, either in whole or in part, to Borrowers for such
purposes and upon such conditions as Administrative Agent shall designate.
(d) In the event of foreclosure of any Mortgage, or other transfer of
title to any Collateral Property in extinguishment in whole or in part of the
Obligations, all right, title, and interest of Borrowers in and to the Policies
then in force concerning such Collateral Property and all proceeds payable
thereunder shall thereupon vest in the purchaser at such foreclosure,
Administrative Agent, or other transferee in the event of such other transfer of
title.
Property Management. Borrowers shall (a) (i) promptly perform and
observe, and require (or in the case of an Affiliate cause) the applicable
Operating Lessee to promptly perform and observe, all of the covenants required
to be performed and observed under each Management Agreement and do all things
necessary to preserve and to keep unimpaired its material rights thereunder
except where failure could not reasonably be expected to cause a Material
Property Event; (ii) promptly notify Administrative Agent of any material
default or termination event under any Management Agreement of which it is
aware; (iii) promptly deliver to Administrative Agent a copy of any notice of
default or termination event or other material notice received by an Operating
Lessee under any Management Agreement; (iv) Parent and Borrowers shall require
(or in the case of an Affiliate cause) the applicable Operating Lessee to
promptly give notice to Administrative Agent of any notice or information that
such Operating Lessee receives which indicates that any Manager is terminating
the related Management Agreement or that any Manager is otherwise discontinuing
its management of the applicable Collateral Property other than the scheduled
end of the Management Agreement term; (v) promptly enforce the performance and
observance of all of the covenants required to be performed and observed by each
Operating Lessee under each Management Agreement; and (vi) Borrowers and Parent
shall require (or in the case of an Affiliate cause) each Operating Lessee to
operate each Collateral Property under the terms and conditions of the
applicable Management Agreement.
(b) If at any time, (i) any Manager shall become insolvent or a debtor
in a bankruptcy proceeding, (ii) an Event of Default has occurred and is
continuing, or (iii) a default or termination event reasonably expected to cause
a Material Property Event has occurred and is continuing under any Management
Agreement, and in each case if grounds for such termination exist under the
affected Management Agreement, and subject to any limitations under and as
otherwise provided in any Assignment of Management Agreement, Borrowers shall,
at the request of Administrative Agent, terminate, or require (or in the case of
an Affiliate cause) the applicable Operating Lessee to terminate (A) in the case
of (i) above, each applicable Management Agreement, or (B) in all other cases,
each Management Agreement requested by Administrative Agent in its sole
discretion, upon thirty (30) days prior notice to each applicable Manager and
replace each such Manager with a Qualified Manager approved by Administrative
Agent on terms and conditions satisfactory to Administrative Agent, it being
understood and agreed that the management fee for such replacement manager shall
not exceed then prevailing market rates for comparable properties.
(c) In addition to the foregoing, in the event that Administrative
Agent, in Administrative Agent's reasonable discretion, at any time prior to the
termination of the Assignment of Management Agreement, determines that any
Collateral Property is not being managed in accordance with generally accepted
management practices for projects similarly situated, Administrative Agent may
deliver written notice thereof to Borrowers and each applicable Manager, which
notice shall specify with particularity the grounds for Administrative Agent's
determination. If Administrative Agent reasonably determines that
Credit Agreement 54
the conditions specified in Administrative Agent's notice are not remedied to
Administrative Agent's reasonable satisfaction by Borrowers or such applicable
Manager within thirty (30) days from the date of such notice or that Borrowers
or such applicable Manager have failed to diligently undertake correcting such
conditions within such thirty (30) day period, except where failure could not
reasonably be expected to cause a Material Property Event, Administrative Agent
may direct Borrowers to terminate the applicable Management Agreement if grounds
for such termination exist thereunder, and in accordance with and subject to any
rights and/or limitations set forth in the applicable Assignment of Management
Agreement, to replace such applicable Manager with a Qualified Manager approved
by Administrative Agent on terms and conditions satisfactory to Administrative
Agent, it being understood and agreed that the management fee for such
replacement manager shall not exceed then prevailing market rates for comparable
properties.
(d) Borrowers shall not, nor shall they permit any Operating Lessee to,
without the prior written consent of Administrative Agent (which consent shall
not be unreasonably withheld, conditioned or delayed): (i) surrender, terminate,
or cancel any Management Agreement or otherwise replace any Manager or enter
into any other management agreement with respect to any Collateral Property
except to the extent the foregoing could not reasonably be expected to cause a
Material Property Event; (ii) reduce or consent to the reduction of the term of
any Management Agreement except to the extent the foregoing could not reasonably
be expected to cause a Material Property Event; (iii) increase or consent to the
increase of the amount of any management fees under any Management Agreement
except to the extent the foregoing could not reasonably be expected to cause a
Material Property Event; or (iv) otherwise modify, change, supplement, alter, or
amend, or waive or release any of its rights and remedies under, any Management
Agreement in any material respect except to the extent the foregoing could not
reasonably be expected to cause a Material Property Event. In the event that
Borrowers or any Operating Lessees replace any Manager, such Manager shall be a
Qualified Manager.
Franchise Agreements.
(a) Each Collateral Property shall be operated under the terms and
conditions of the applicable Franchise Agreement, if any, Borrowers shall, and
shall cause each Affiliate Operating Lessee to, (i) pay all sums required to be
paid by Operating Lessees under each Franchise Agreement, (ii) diligently
perform, observe, and enforce all of the terms, covenants, and conditions of
each Franchise Agreement on the part of an Operating Lessee to be performed,
observed, and enforced to the end that all things shall be done which are
necessary to keep unimpaired the rights of each Operating Lessee under each
Franchise Agreement except to the extent the foregoing could not reasonably be
expected to cause a Material Property Event, (iii) promptly notify
Administrative Agent of the giving of any notice to an Operating Lessee of any
default by such Operating Lessee in the performance or observance of any of the
terms, covenants, or conditions of any Franchise Agreement on the part of any
Operating Lessee to be performed and observed and deliver to Administrative
Agent a true copy of each such notice, and (iv) promptly deliver to
Administrative Agent a copy of each financial statement, business plan, capital
expenditure plan, notice, report, and estimate received by it under any
Franchise Agreement.
(b) Borrowers shall not, nor shall they permit any Operating Lessee
to, without the prior consent of the Administrative Agent, surrender any
Franchise Agreement or terminate or cancel any Franchise Agreement or modify,
change, supplement, alter or amend any Franchise Agreement, in any respect,
either orally or in writing.
(c) If an Operating Lessee shall default in the performance or
observance of any material term, covenant, or condition of any Franchise
Agreement to be performed or observed, then, without limiting the generality of
the other provisions of this Agreement, and without waiving or releasing
Borrowers from any of their obligations hereunder, Administrative Agent shall
have the right, but shall be
Credit Agreement 55
under no obligation, to pay any sums and to perform any act or take any action
as may be appropriate to cause all the terms, covenants, and conditions of such
Franchise Agreement on the part of such Operating Lessee to be performed or
observed to be promptly performed or observed on behalf of such Operating
Lessee, to the end that the rights of such Operating Lessee in, to, and under
such Franchise Agreement shall be kept unimpaired and free from default.
Administrative Agent and any person designated by Administrative Agent shall
have, and are hereby granted, the right to enter upon the applicable Collateral
Property at any time and from time to time for the purpose of taking any such
action. If any Franchisor shall deliver to Administrative Agent a copy of any
notice sent to an Operating Lessee of default under any applicable Franchise
Agreement, such notice shall constitute full protection to Administrative Agent
for any action taken or omitted to be taken by Administrative Agent in good
faith, in reliance thereon.
(d) Any sums expended by Administrative Agent pursuant to this Section
6.20 shall bear interest at the Default Rate from the date such cost is incurred
to the date of payment to Administrative Agent, shall be deemed to constitute a
portion of the Obligations, shall be secured by the Lien of the Mortgages and
the other Loan Documents and shall be immediately due and payable upon demand by
Administrative Agent therefor.
(e) Borrowers shall, promptly upon request of Administrative Agent, use
diligent good faith efforts to obtain and deliver an estoppel certificate from
each Franchisor stating that (i) each applicable Franchise Agreement is in full
force and effect and has not been modified, amended, or assigned, (ii) neither
such Franchisor nor any Operating Lessee is in default under any of the terms,
covenants, or provisions of each applicable Franchise Agreement and such
Franchisor knows of no event which, but for the passage of time or the giving of
notice or both, would constitute an event of default under each applicable
Franchise Agreement, (iii) neither such Franchisor nor any Operating Lessee has
commenced any action or given or received any notice for the purpose of
terminating any applicable Franchise Agreement, and (iv) all sums due and
payable to such Franchisor under each applicable Franchise Agreement have been
paid in full.
(f) In the event that any Management Agreement also serves as a
franchise agreement or contains provisions typically contained in franchise
agreements, then the provisions of this Section 6.20 shall apply to such
Management Agreement.
Ground Leases.
(a) Borrowers shall (i) pay all rents, additional rents, and other sums
required to be paid by Borrowers, as tenant under and pursuant to the provisions
of the Ground Leases, (ii) diligently perform and observe all of the terms,
covenants, and conditions of the Ground Leases on the part of Borrowers, as
tenant thereunder, (iii) promptly notify Administrative Agent of the giving of
any notice by the landlord under any Ground Lease to Borrowers of any default by
a Borrower, as tenant thereunder, and deliver to Administrative Agent a true
copy of each such notice within five (5) Business Days of receipt, and (iv)
promptly notify Administrative Agent of any bankruptcy, reorganization, or
insolvency of the landlord under any Ground Lease or of any notice thereof, and
deliver to Administrative Agent a true copy of such notice within five (5)
Business Days of any Borrower's receipt. Borrowers shall not, without the prior
consent of Administrative Agent, surrender the leasehold estate created by any
Ground Lease or terminate or cancel any Ground Lease or modify, change,
supplement, alter, or amend any Ground Lease, either orally or in writing, and
if any Borrower shall default in the performance or observance of any term,
covenant, or condition of any Ground Lease on the part of such Borrower, as
tenant thereunder, and shall fail to cure the same prior to the expiration of
any applicable cure period provided thereunder, Administrative Agent shall have
the right, but shall be under no obligation, to pay any sums and to perform any
act or take any action as may be appropriate to cause all of the terms,
covenants, and conditions of such Ground Lease on the part of any Borrower to be
performed or observed on behalf of
Credit Agreement 56
such Borrower, to the end that the rights of such Borrower in, to, and under
such Ground Lease shall be kept unimpaired and free from default. If the
landlord under any Ground Lease shall deliver to Administrative Agent a copy of
any notice of default under such Ground Lease, such notice shall constitute full
protection to Administrative Agent for any action taken or omitted to be taken
by Administrative Agent, in good faith, in reliance thereon. Borrower shall
exercise each individual option, if any, to extend or renew the term of any
Ground Lease upon demand by Administrative Agent made at any time within one (1)
year prior to the last day upon which any such option may be exercised, and
Borrowers hereby expressly authorize and appoint Administrative Agent its
attorney-in-fact to exercise any such option in the name of and upon behalf of
Borrowers, which power of attorney shall be irrevocable and shall be deemed to
be coupled with an interest.
(b) Notwithstanding anything contained in any Ground Lease to the
contrary, Borrowers shall not further sublet any portion of the Collateral
Property (other than as permitted pursuant to the applicable terms and
conditions hereof) without prior written consent of Administrative Agent.
(c) No Ground Lease may be canceled, terminated, surrendered, or
amended without the prior, written consent of Administrative Agent.
Operating Leases. Borrowers shall not, without the prior written consent
of Administrative Agent, enter into, renew, extend, amend, or modify the term of
any Operating Lease.
Post-Closing Covenants. Parent and Borrowers shall comply with each of
the covenants and agreements set forth on Schedule 6.23 within the time limit
specified therein for such completion.
NEGATIVE COVENANTS
So long as any Lender shall have any Commitment hereunder, any Loan or
other Obligation hereunder shall remain unpaid or unsatisfied:
Liens. No RFS Company shall create, incur, assume, or suffer to exist
any Lien upon any of its property, assets or revenues, whether now owned or
hereafter acquired, other than the following:
(a) Liens pursuant to any Loan Document;
(b) Liens existing on the date hereof and listed on Schedule 7.01 and
any renewals or extensions thereof, provided that the property covered thereby
is not increased and any renewal or extension of the obligations secured or
benefited thereby is permitted by Section 7.03(b);
(c) Liens for taxes not yet due and payable or which are being
contested in good faith and by appropriate proceedings diligently conducted, if
adequate reserves with respect thereto are maintained on the books of the
applicable Person in accordance with GAAP;
(d) carriers', warehousemen's, mechanics', materialmen's, repairmen's,
or other like Liens arising in the ordinary course of business which are not
overdue for a period of more than thirty (30) days or which are being contested
in good faith and by appropriate proceedings diligently conducted, if adequate
reserves with respect thereto are maintained on the books of the applicable
Person;
Credit Agreement 57
(e) pledges or deposits in the ordinary course of business in
connection with workers' compensation, unemployment insurance, and other social
security legislation, other than any Lien imposed by ERISA;
(f) deposits to secure the performance of bids, trade contracts, and
leases (other than Indebtedness), statutory obligations, surety bonds (other
than bonds related to judgments or litigation), performance bonds, and other
obligations of a like nature incurred in the ordinary course of business;
(g) Liens set forth in the Title Insurance issued with respect to the
Mortgages, and other encumbrances affecting Properties of the RFS Companies
other than the Collateral Properties which, in the aggregate, are not
substantial in amount, and which do not in any case materially detract from the
value of the property subject thereto or materially interfere with the ordinary
conduct of the business of the applicable Person;
(h) Liens securing judgments for the payment of money not constituting
an Event of Default under Section 8.01(h) or securing appeal or other surety
bonds related to such judgments; and
(i) Liens securing the CMBS Facilities on the CMBS Collateral
Properties released as collateral by Administrative Agent pursuant to Section
2.12(d).
Investments. No RFS Company shall make any Investments, except:
(a) Investments in the form of cash equivalents or short-term
marketable securities;
(b) (i) advances to officers, directors, and employees of the RFS
Companies in an aggregate amount not to exceed $1,000,000 at any time
outstanding, for travel, entertainment, relocation, and analogous ordinary
business purposes and (ii) current accounts receivable created in the ordinary
course of business of the RFS Companies;
(c) Investments in (i) Subsidiaries of such RFS Company existing on the
Closing Date and listed on Schedule 7.02, and (ii) the CMBS Borrowers;
(d) Investments consisting of extensions of credit in the nature of
accounts receivable or notes receivable arising from the grant of trade credit
in the ordinary course of business, and Investments received in satisfaction or
partial satisfaction thereof from financially troubled account debtors to the
extent reasonably necessary in order to prevent or limit loss;
(e) Guarantees permitted by Section 7.03; and
(f) Investments in Properties financed with available or contributed
cash or through the issuance of stock or other equity interests.
Indebtedness. No RFS Company shall create, incur, assume, or suffer to
exist any Indebtedness, except:
(a) Indebtedness under the Loan Documents;
(b) Indebtedness outstanding on the date hereof and listed on Schedule
7.03 and any refinancings, refundings, renewals, or extensions thereof; provided
that the amount of such Indebtedness is not increased at the time of such
refinancing, refunding, renewal, or extension except by an amount equal to a
reasonable premium or other reasonable amount paid, and fees and expenses
reasonably
Credit Agreement 58
incurred, in connection with such refinancing and by an amount equal to any
existing commitments unutilized thereunder;
(c) Guarantees in respect of Indebtedness otherwise permitted hereunder
of any Loan Party; provided that if any Subsidiary of Operating Company
Guarantees such Indebtedness, then it shall also Guarantee the Obligations on a
pari passu basis;
(d) obligations (contingent or otherwise) existing or arising under any
Swap Contract, provided that (i) such obligations are (or were) entered into by
such Person in the ordinary course of business for the purpose of directly
mitigating risks associated with liabilities, commitments, investments, assets,
or property held or reasonably anticipated by such Person, or changes in the
value of securities issued by such Person, and not for purposes of speculation
or taking a "market view," and (ii) such Swap Contract does not contain any
provision exonerating the non-defaulting party from its obligation to make
payments on outstanding transactions to the defaulting party;
(e) Indebtedness to Parent or another Loan Party which would otherwise
be permitted pursuant to both this Agreement and the terms of the Senior Notes;
and
(f) the CMBS Facilities.
Fundamental Changes. Neither Parent nor any RFS Company shall merge,
dissolve, liquidate, consolidate with or into another Person, or Dispose of
(whether in one transaction or in a series of transactions) all or substantially
all of its assets (whether now owned or hereafter acquired) to or in favor of
any Person; provided that any Subsidiary of Operating Company (other than
Financing) may (a)(i) merge with any other Subsidiary of Operating Company, or
(ii) be liquidated if all assets are transferred to Operating Company, or (iii)
merge with Operating Company so long as Operating Company is the survivor, and
(b) transfer assets to any other Subsidiary of Operating Company or to Operating
Company.
Dispositions. No RFS Company shall make any Disposition or enter into
any agreement to make any Disposition of any Collateral Property, except:
(a) Dispositions of obsolete or worn out property, whether now owned or
hereafter acquired, in the ordinary course of business;
(b) Dispositions of inventory in the ordinary course of business;
(c) Dispositions of equipment or real property to the extent that (i)
such property is exchanged for credit against the purchase price of similar
replacement property or (ii) the proceeds of such Disposition are reasonably
promptly applied to the purchase price of such replacement property;
(d) Dispositions to another RFS Company; provided that if the
transferor of such property is a Loan Party, the transferee thereof must be a
Loan Party;
(e) Dispositions to a CMBS Borrower to secure CMBS Facilities, so long
as such Disposition occurs simultaneously with the release of Administrative
Agent's Lien on such Properties pursuant to Section 2.12(b);
(f) Dispositions of any Collateral Property (or simultaneous
Dispositions of Collateral Properties) listed on Schedule 7.05, so long as (i)
no Default or Event of Default exists at the time of any such Disposition or
would result therefrom, and (ii) Administrative Agent receives a prepayment of
the Obligations in an amount equal to the greater of (A) one hundred percent
(100%) of the Net Cash
Credit Agreement 59
Proceeds from such Disposition (or simultaneous Dispositions), and (B) ninety
percent (90%) of the then-current Collateral Value of such Collateral Property
(or the then-current aggregate Collateral Values of Collateral Properties from
simultaneous Dispositions); and
(g) Dispositions of any Excluded Collateral Property, so long as (i) no
Default or Event of Default exists at the time of any such Disposition or would
result therefrom, and (ii) Administrative Agent receives one hundred percent
(100%) of the Net Cash Proceeds from such Disposition as a prepayment of the
Obligations.
Restricted Payments. Neither Parent nor any RFS Company shall declare or
make, directly or indirectly, any Restricted Payment, or incur any obligation
(contingent or otherwise) to do so, except that:
(a) any Subsidiary of Operating Company may make Restricted Payments to
Operating Company;
(b) Operating Company may make Restricted Payments to Acquisition Sub
and to CNL Rose Acquisition GP Corp., and Acquisition Sub and CNL Rose
Acquisition GP Corp. may make Restricted Payments to Parent, so long as no
Default or Event of Default exists or would result therefrom;
(c) Parent may make Restricted Payments to the holders of its stock (i)
necessary to maintain Parent's status as a REIT, and (ii) so long as no Default
or Event of Default exists or would result therefrom, dividends consistent with
Parent's current dividend policy not to exceed a dividend of $0.775 per share;
(d) Parent and each RFS Company may declare and make dividend payments
or other distributions payable solely in the common stock or other common equity
interests of such Person;
(e) Parent and each RFS Company may purchase, redeem, or otherwise
acquire shares of its common stock or other common equity interests or warrants
or options to acquire any such shares with the proceeds received from the
substantially concurrent issue of new shares of its common stock or other common
equity interests; and
(f) Operating Company may make Restricted Payments to holders of its
partnership interests and Acquisition Sub may make Restricted Payments to the
former shareholders of RFS Hotel Investors, Inc. pursuant to the Merger
Agreement to be used as consideration for the Merger Transactions.
Change in Nature of Business. No RFS Company shall engage in any
material line of business substantially different from those lines of business
conducted by the RFS Companies on the date hereof or any business substantially
related or incidental thereto.
Transactions with Affiliates. No RFS Company shall enter into any
transaction of any kind with any Affiliate of Parent, whether or not in the
ordinary course of business, other than on fair and reasonable terms
substantially as favorable to such RFS Company as would be obtainable by such
RFS Company at the time in a comparable arm's length transaction with a Person
other than an Affiliate.
Burdensome Agreements. No RFS Company shall enter into any Contractual
Obligation (other than this Agreement, any other Loan Document, the Senior
Notes, and other documents evidencing existing Indebtedness) that (a) limits the
ability (i) of any RFS Company to make Restricted Payments to Borrowers or any
other Loan Party or to otherwise transfer property to Borrowers or any other
Loan Party, (ii) of Parent or any RFS Company to Guarantee the Indebtedness of
Borrowers, or (iii) of Parent or any RFS Company to create, incur, assume, or
suffer to exist Liens on property of such Person, or
Credit Agreement 60
(b) requires the grant of a Lien to secure an obligation of such Person if a
Lien is granted to secure another obligation of such Person.
Use of Proceeds. No RFS Company shall use the proceeds of any Loan,
whether directly or indirectly, and whether immediately, incidentally, or
ultimately, to purchase or carry margin stock (within the meaning of Regulation
U of the FRB) or to extend credit to others for the purpose of purchasing or
carrying margin stock or to refund indebtedness originally incurred for such
purpose.
Contracts. Without Administrative Agent's prior written approval as to
parties, terms, and all other matters, Borrowers shall not permit any Operating
Lessee or Manager to (a) enter into any management, leasing, maintenance, or
other contract pertaining to any Collateral Property that is not unconditionally
terminable by such Person or any successor owner without penalty or payment on
not more than thirty (30) days notice to the other party thereunder, or (b)
modify, amend, or terminate any such contracts. No RFS Company shall, nor shall
it permit any Operating Lessee or Manager to, default under any contract or
permit any contract to terminate by reason of any failure of such Person to
perform thereunder, and Operating Company shall promptly notify Administrative
Agent of any default thereunder. Operating Company will deliver or cause to be
delivered to Administrative Agent, upon request of Administrative Agent, the
names and addresses of all persons or entities with whom each contractor has
contracted or intends to contract. Administrative Agent shall not unreasonably
withhold, condition, or delay its approval of new Operating Leases, Management
Agreements, or Franchise Agreements proposed by the RFS Companies for any
Collateral Property.
Lease Approval. Borrowers shall not permit any Operating Lessee to enter
into any tenant lease (as used herein, "Tenant Lease") of space in the
Improvements unless approved or deemed approved by Administrative Agent prior to
execution. Such Person's standard form of Tenant Lease, and any revisions
thereto, must have the prior written approval of Administrative Agent.
Notwithstanding the foregoing or anything set forth herein to the contrary,
Tenant Leases entered into in the ordinary course of business following
recordation of the Mortgages, and which could not reasonably be expected to
cause a Material Property Event, shall not require any approval by
Administrative Agent.
No Other Liens. No RFS Company shall, without the prior written consent
of Administrative Agent, create, place, or permit to be created or placed, or
through any act or failure to act, acquiesce in the placing of, or allow to
remain, any deed of trust, mortgage, voluntary or involuntary lien, whether
statutory, constitutional, or contractual, security interest, encumbrance, or
charge, or conditional sale or other title retention document, against or
covering any Collateral Property, or any part thereof, other than normal and
customary encumbrances associated with operation of any Collateral Property, and
should any of the foregoing become attached hereafter in any manner to any part
of the Collateral Property without the prior written consent of Administrative
Agent, Borrowers will cause the same to be promptly discharged and released.
Borrowers will own all parts of the Collateral Properties and will not acquire
any fixtures, equipment, or other property (including software embedded therein)
forming a part of any Collateral Property pursuant to a lease, license, security
agreement, or similar agreement, whereby any party has or may obtain the right
to repossess or remove same, without the prior written consent of Administrative
Agent.
Reciprocal Easement Agreements. Neither Borrower shall:
(a) enter into, terminate, or modify any REA without Administrative
Agent's prior written consent, which consent shall not be unreasonably withheld,
conditioned or delayed; or
(b) enforce, comply with, and cause each of the parties to the REA to
comply with all of the material economic terms and conditions contained in any
REA.
Credit Agreement 61
Parent Financial Covenants.
(a) Consolidated Tangible Net Worth. Parent shall not permit the
Consolidated Tangible Net Worth of Parent and its Subsidiaries on a consolidated
basis at any time to be less than the sum of (a) $950,000,000 and (b) an amount
equal to eighty-five percent 85% of the aggregate increases in Shareholders'
Equity of Parent, by reason of the issuance and sale of capital stock or other
equity interests of Parent or any Subsidiary (other than issuances to Parent or
a wholly-owned Subsidiary), including upon any conversion of debt securities of
Parent into such capital stock or other equity interests.
(b) Consolidated Leverage Ratio. Parent shall not permit the
Consolidated Leverage Ratio of Parent and its Subsidiaries on a consolidated
basis at any time to be greater than 0.55 to 1.0.
(c) Consolidated Fixed Charge Coverage Ratio. Parent shall not permit
the Consolidated Fixed Charge Coverage Ratio of Parent and its Subsidiaries on a
consolidated basis as at the end of any fiscal quarter of Parent to be less than
1.50 to 1.0.
Operating Company Financial Covenants. Operating Company shall not
permit the Consolidated Fixed Charge Coverage Ratio of Operating Company and its
Subsidiaries on a consolidated basis as at the end of any fiscal quarter of
Operating Company to be less than 1.40 to 1.0.
Loan to Value Ratio. Borrowers shall not permit the Loan to Value Ratio
as of any date to be greater than 0.60 to 1.0.
REIT Status. Parent (including its organization and method of
operations) shall at all times qualify as a REIT.
EVENTS OF DEFAULT AND REMEDIES
Events of Default. Any of the following shall constitute an Event of
Default:
(a) Non-Payment. Either Borrower or any other Loan Party fails to pay
(i) when and as required to be paid herein, any amount of principal of any Loan,
or (ii) within three (3) days after the same becomes due, any interest on any
Loan, or any commitment or other fee due hereunder, or (iii) within five (5)
days after written notice of such failure, any other amount payable hereunder or
under any other Loan Document; or
(b) Specific Covenants. Any Loan Party fails to perform or observe any
term, covenant, or agreement, contained in any of Sections 6.01, 6.02, 6.03,
6.05, 6.10, or 6.11 or Article VII; or
(c) Other Defaults. Any Loan Party fails to perform or observe any
other covenant or agreement (not specified in subsection (a) or (b) above)
contained in any Loan Document on its part to be performed or observed and such
failure continues for thirty (30) days; or
(d) Representations and Warranties. Any representation, warranty,
certification, or statement of fact made or deemed made by or on behalf of any
Loan Party herein, in any other Loan Document, or in any document delivered in
connection herewith or therewith shall be incorrect or misleading in any
material respect when made or deemed made; or
(e) Cross-Default. (i) Parent or any RFS Company (A) fails to make any
payment when due (whether by scheduled maturity, required prepayment,
acceleration, demand, or otherwise) in respect of
Credit Agreement 62
any Indebtedness or Guarantee (other than Indebtedness hereunder and
Indebtedness under Swap Contracts) having an aggregate principal amount
(including undrawn committed or available amounts and including amounts owing to
all creditors under any combined or syndicated credit arrangement) of more than
the Threshold Amount, or (B) fails to observe or perform any other agreement or
condition relating to any such Indebtedness or Guarantee or contained in any
instrument or agreement evidencing, securing, or relating thereto, or any other
event occurs, the effect of which default or other event is to cause, or to
permit the holder or holders of such Indebtedness or the beneficiary or
beneficiaries of such Guarantee (or a trustee or agent on behalf of such holder
or holders or beneficiary or beneficiaries) to cause, with the giving of notice
if required, such Indebtedness to be demanded or to become due or to be
repurchased, prepaid, defeased, or redeemed (automatically or otherwise), or an
offer to repurchase, prepay, defease, or redeem such Indebtedness to be made,
prior to its stated maturity, or such Guarantee to become payable or cash
collateral in respect thereof to be demanded subject to applicable curative or
grace periods; or (ii) there occurs under any Swap Contract an Early Termination
Date (as defined in such Swap Contract) resulting from (A) any event of default
under such Swap Contract as to which Parent or any RFS Company is the Defaulting
Party (as defined in such Swap Contract) or (B) any Termination Event (as so
defined) under such Swap Contract as to which any Parent or any RFS Company is
an Affected Party (as so defined) and, in either event, the Swap Termination
Value owed by Parent or any RFS Company as a result thereof is greater than the
Threshold Amount; or
(f) Insolvency Proceedings, Etc. Parent or any RFS Company institutes
or consents to the institution of any proceeding under any Debtor Relief Law, or
makes an assignment for the benefit of creditors; or applies for or consents to
the appointment of any receiver, trustee, custodian, conservator, liquidator,
rehabilitator or similar officer for it or for all or any material part of its
property; or any receiver, trustee, custodian, conservator, liquidator,
rehabilitator, or similar officer is appointed without the application or
consent of such Person and the appointment continues undischarged or unstayed
for sixty (60) calendar days; or any proceeding under any Debtor Relief Law
relating to any such Person or to all or any material part of its property is
instituted without the consent of such Person and continues undismissed or
unstayed for sixty (60) calendar days, or an order for relief is entered in any
such proceeding; or
(g) Inability to Pay Debts; Attachment. (i) Parent or any RFS Company
becomes unable or admits in writing its inability or fails generally to pay its
debts as they become due, or (ii) any writ or warrant of attachment or execution
or similar process is issued or levied against all or any material part of the
property of any such Person and is not released, vacated, or fully bonded within
thirty (30) days after its issue or levy; or
(h) Judgments. There is entered against Parent or any RFS Company (i) a
final judgment or order for the payment of money in an aggregate amount
exceeding the Threshold Amount (to the extent not covered by independent
third-party insurance as to which the insurer does not dispute coverage), or
(ii) any one or more non-monetary final judgments that have, or could reasonably
be expected to have, individually or in the aggregate, a Material Adverse Effect
and, in either case, (A) enforcement proceedings are commenced by any creditor
upon such judgment or order, or (B) there is a period of ten (10) consecutive
days during which a stay of enforcement of such judgment, by reason of a pending
appeal or otherwise, is not in effect; or
(i) ERISA. (i) An ERISA Event occurs with respect to a Pension Plan or
Multiemployer Plan which has resulted or could reasonably be expected to result
in liability of Parent or any RFS Company under Title IV of ERISA to the Pension
Plan, Multiemployer Plan or the PBGC in an aggregate amount in excess of the
Threshold Amount, or (ii) Parent or any RFS Company or any ERISA Affiliate fails
to pay when due, after the expiration of any applicable grace period, any
installment payment with
Credit Agreement 63
respect to its withdrawal liability under Section 4201 of ERISA under a
Multiemployer Plan in an aggregate amount in excess of the Threshold Amount; or
(j) Invalidity of Loan Documents. Any Loan Document, at any time after
its execution and delivery and for any reason other than as expressly permitted
hereunder or satisfaction in full of all the Obligations, ceases to be in full
force and effect; or any Loan Party or any other Person contests in any manner
the validity or enforceability of any Loan Document; or any Loan Party denies
that it has any or further liability or obligation under any Loan Document, or
purports to revoke, terminate, or rescind any Loan Document; or
(k) Change of Control. There occurs any Change of Control with respect
to Parent or any RFS Company (other than of Subsidiaries of Operating Company
pursuant to a Disposition which is otherwise permitted hereunder); or
(l) Collateral Properties.
(i) any material required permit, license, certificate, or
approval with respect to any Collateral Property lapses or ceases to be
in full force and effect; or
(ii) the owner of any Collateral Property enters into any
lease of part or all of such Collateral Property which does not comply
with the Loan Documents, or a material default by the owner of any
Collateral Property under or any failure by the owner of such
Collateral Property to satisfy any of the conditions of a lease; or
(iii) a lien for the performance of work or the supply of materials
which is established against any Collateral Property, or any stop
notice served on either Borrower, the general contractor,
Administrative Agent, or a Lender, remains unsatisfied or unbonded for
a period of twenty (20) days after the date of filing or service; or
(iv) the occurrence of any condition or situation which, in the
sole determination of Administrative Agent, constitutes a danger to or
impairment of any Collateral Property or the liens of the Mortgages, if
such condition or situation is not remedied within ten (10) days after
written notice to Borrowers thereof; or
(v) if a Borrower shall permit any event within its control to
occur that would cause any REA to terminate without notice or action by
any party thereto or would entitle any party to terminate any REA and
the term thereof by giving notice to such Borrower; or any REA shall be
surrendered, terminated, or canceled for any reason or under any
circumstance whatsoever except as provided for in such REA; or any term
of any REA shall be modified or supplemented without Administrative
Agent's prior written consent; or a Borrower shall fail, within ten
(10) Business Days after demand by Administrative Agent, to exercise
its option to renew or extend the term of any REA or shall fail or
neglect to pursue diligently all actions necessary to exercise such
renewal rights pursuant to such REA except as provided for in such REA;
or
(vi) if a default or termination event on the part of any Loan
Party or any Person that is an Affiliate of any Loan Party has occurred
and continues beyond any applicable cure period under any Franchise
Agreement, Management Agreement, Ground Lease, or Operating Lease, or
if a Borrower or Operating Lessee, without Administrative Agent's prior
written consent, terminates or cancels any Franchise Agreement,
Management Agreement, Ground Lease, or Operating Lease or operates any
Collateral Property under the name of any hotel chain or system other
than the name such Collateral Property is operated under as of the date
hereof; or
Credit Agreement 64
(m) Acquisition Sub. Acquisition Sub shall engage in any business or
activity other than holding all or substantially all of the partnership
interests of Operating Company;
(n) CMBS Engagement Letter. The obligations and agreements described in
the CMBS Engagement Letter shall for any reason be cancelled, terminated, or
otherwise cease to be in effect; or
(o) Environmental Claim. If any event or condition shall occur or exist
on or with respect to any Property of Parent or any RFS Company which has
resulted, or could reasonably be expected to result, in an Environmental Claim
which has resulted, or could reasonably be expected to result, in liability of
Parent or any RFS Company in an amount in excess of the Threshold Amount.
Remedies Upon Event of Default. If any Event of Default occurs and is
continuing, Administrative Agent shall, at the request of, or may, with the
consent of, the Required Lenders, take any or all of the following actions:
(a) declare the commitment of each Lender to make Loans to be
terminated, whereupon such commitments and obligation shall be terminated;
(b) declare the unpaid principal amount of all outstanding Loans, all
interest accrued and unpaid thereon, and all other amounts owing or payable
hereunder or under any other Loan Document to be immediately due and payable,
without presentment, demand, protest, or other notice of any kind, all of which
are hereby expressly waived by Borrowers; and
(c) exercise on behalf of itself and Lenders all rights and remedies
available to it and Lenders under the Loan Documents or applicable law;
provided, however, that upon the occurrence of an actual or deemed entry of an
order for relief with respect to either Borrower under the Bankruptcy Code of
the United States, the obligation of each Lender to make Loans shall
automatically terminate, the unpaid principal amount of all outstanding Loans
and all interest and other amounts as aforesaid shall automatically become due
and payable, without further act of Administrative Agent or any Lender.
Application of Funds. After the exercise of remedies provided for in
Section 8.02 (or after the Loans have automatically become immediately due and
payable as set forth in the proviso to Section 8.02), any amounts received on
account of the Obligations shall be applied by Administrative Agent in the
following order:
First, to payment of that portion of the Obligations constituting fees,
indemnities, expenses and other amounts (including Attorney Costs and amounts
payable under Article III) payable to Administrative Agent in its capacity as
such;
Second, to payment of that portion of the Obligations constituting
fees, indemnities and other amounts (other than principal and interest) payable
to Lenders (including Attorney Costs and amounts payable under Article III),
ratably among them in proportion to the amounts described in this clause Second
payable to them;
Third, to payment of that portion of the Obligations constituting
accrued and unpaid interest on the Loans, ratably among Lenders in proportion to
the respective amounts described in this clause Third payable to them;
Credit Agreement 65
Fourth, to payment of that portion of the Obligations constituting
unpaid principal of the Loans, ratably among Lenders in proportion to the
respective amounts described in this clause Fourth held by them; and
Last, the balance, if any, after all of the Obligations have been
indefeasibly paid in full, to Borrowers or as otherwise required by Law.
ADMINISTRATIVE AGENT
Appointment and Authorization of Administrative Agent. Each Lender
hereby irrevocably appoints, designates, and authorizes Administrative Agent to
take such action on its behalf under the provisions of this Agreement and each
other Loan Document and to exercise such powers and perform such duties as are
expressly delegated to it by the terms of this Agreement or any other Loan
Document, together with such powers as are reasonably incidental thereto.
Notwithstanding any provision to the contrary contained elsewhere herein or in
any other Loan Document, Administrative Agent shall not have any duties or
responsibilities, except those expressly set forth herein, nor shall
Administrative Agent have or be deemed to have any fiduciary relationship with
any Lender or participant, and no implied covenants, functions,
responsibilities, duties, obligations, or liabilities shall be read into this
Agreement or any other Loan Document or otherwise exist against Administrative
Agent. Without limiting the generality of the foregoing sentence, the use of the
term "agent" herein and in the other Loan Documents with reference to
Administrative Agent is not intended to connote any fiduciary or other implied
(or express) obligations arising under agency doctrine of any applicable Law.
Instead, such term is used merely as a matter of market custom, and is intended
to create or reflect only an administrative relationship between independent
contracting parties.
Delegation of Duties. Administrative Agent may execute any of its
duties under this Agreement or any other Loan Document by or through agents,
employees, or attorneys-in-fact and shall be entitled to advice of counsel and
other consultants or experts concerning all matters pertaining to such duties.
Administrative Agent shall not be responsible for the negligence or misconduct
of any agent or attorney-in-fact that it selects in the absence of gross
negligence or willful misconduct.
Liability of Administrative Agent. No Agent-Related Person shall (a) be
liable for any action taken or omitted to be taken by any of them under or in
connection with this Agreement or any other Loan Document or the transactions
contemplated hereby (except for its own gross negligence or willful misconduct
in connection with its duties expressly set forth herein), or (b) be responsible
in any manner to any Lender or participant for any recital, statement,
representation, or warranty made by any Loan Party or any officer thereof,
contained herein or in any other Loan Document, or in any certificate, report,
statement, or other document referred to or provided for in, or received by
Administrative Agent under or in connection with, this Agreement or any other
Loan Document, or the validity, effectiveness, genuineness, enforceability, or
sufficiency of this Agreement or any other Loan Document, or for any failure of
any Loan Party or any other party to any Loan Document to perform its
obligations hereunder or thereunder. No Agent-Related Person shall be under any
obligation to any Lender or participant to ascertain or to inquire as to the
observance or performance of any of the agreements contained in, or conditions
of, this Agreement or any other Loan Document, or to inspect the properties,
books, or records of any Loan Party or any Affiliate thereof.
Reliance by Administrative Agent.
(a) Administrative Agent shall be entitled to rely, and shall be fully
protected in relying, upon any writing, communication, signature, resolution,
representation, notice, consent, certificate,
Credit Agreement 66
affidavit, letter, telegram, facsimile, telex or telephone message, electronic
mail message, statement, or other document or conversation believed by it to be
genuine and correct and to have been signed, sent or made by the proper Person
or Persons, and upon advice and statements of legal counsel (including counsel
to any Loan Party), independent accountants and other experts selected by
Administrative Agent. Administrative Agent shall be fully justified in failing
or refusing to take any action under any Loan Document unless it shall first
receive such advice or concurrence of the Required Lenders as it deems
appropriate and, if it so requests, it shall first be indemnified to its
satisfaction by Lenders against any and all liability and expense which may be
incurred by it by reason of taking or continuing to take any such action.
Administrative Agent shall in all cases be fully protected in acting, or in
refraining from acting, under this Agreement or any other Loan Document in
accordance with a request or consent of the Required Lenders (or such greater
number of Lenders as may be expressly required hereby in any instance) and such
request and any action taken or failure to act pursuant thereto shall be binding
upon all Lenders.
(b) For purposes of determining compliance with the conditions
specified in Section 4.01, each Lender that has signed this Agreement shall be
deemed to have consented to, approved, or accepted, or to be satisfied with,
each document or other matter required thereunder to be consented to or approved
by or acceptable or satisfactory to a Lender unless Administrative Agent shall
have received notice from such Lender prior to the proposed Closing Date
specifying its objection thereto.
Notice of Default. Administrative Agent shall not be deemed to have
knowledge or notice of the occurrence of any Default, except with respect to
defaults in the payment of principal, interest and fees required to be paid to
Administrative Agent for the account of Lenders, unless Administrative Agent
shall have received written notice from a Lender or Borrowers referring to this
Agreement, describing such Default and stating that such notice is a "notice of
default." Administrative Agent will notify Lenders of its receipt of any such
notice. Administrative Agent shall take such action with respect to such Default
as may be directed by the Required Lenders in accordance with Article VIII;
provided, however, that unless and until Administrative Agent has received any
such direction, Administrative Agent may (but shall not be obligated to) take
such action, or refrain from taking such action, with respect to such Default as
it shall deem advisable or in the best interest of Lenders.
Credit Decision; Disclosure of Information by Administrative Agent. Each
Lender acknowledges that no Agent-Related Person has made any representation or
warranty to it, and that no act by Administrative Agent hereafter taken,
including any consent to and acceptance of any assignment or review of the
affairs of any Loan Party or any Affiliate thereof, shall be deemed to
constitute any representation or warranty by any Agent-Related Person to any
Lender as to any matter, including whether Agent-Related Persons have disclosed
material information in their possession. Each Lender represents to
Administrative Agent that it has, independently and without reliance upon any
Agent-Related Person and based on such documents and information as it has
deemed appropriate, made its own appraisal of and investigation into the
business, prospects, operations, property, financial, and other condition and
creditworthiness of the Loan Parties and their respective Subsidiaries, and all
applicable bank or other regulatory Laws relating to the transactions
contemplated hereby, and made its own decision to enter into this Agreement and
to extend credit to Borrowers hereunder. Each Lender also represents that it
will, independently and without reliance upon any Agent-Related Person and based
on such documents and information as it shall deem appropriate at the time,
continue to make its own credit analysis, appraisals and decisions in taking or
not taking action under this Agreement and the other Loan Documents, and to make
such investigations as it deems necessary to inform itself as to the business,
prospects, operations, property, financial, and other condition and
creditworthiness of Borrowers. Except for notices, reports, and other documents
expressly required to be furnished to Lenders by Administrative Agent herein,
Administrative Agent shall not have any duty or responsibility to provide any
Lender with any credit or other information concerning the business, prospects,
operations, property, financial, and
Credit Agreement 67
other condition or creditworthiness of any of the Loan Parties or any of their
respective Affiliates which may come into the possession of any Agent-Related
Person.
Indemnification of Administrative Agent. Whether or not the transactions
contemplated hereby are consummated, Lenders shall indemnify upon demand each
Agent-Related Person (to the extent not reimbursed by or on behalf of any Loan
Party and without limiting the obligation of any Loan Party to do so), pro rata,
and hold harmless each Agent-Related Person from and against any and all
Indemnified Liabilities incurred by it; provided, however, that no Lender shall
be liable for the payment to any Agent-Related Person of any portion of such
Indemnified Liabilities to the extent determined in a final, nonappealable
judgment by a court of competent jurisdiction to have resulted from such
Agent-Related Person's own gross negligence or willful misconduct; provided,
however, that no action taken in accordance with the directions of the Required
Lenders shall be deemed to constitute gross negligence or willful misconduct for
purposes of this Section 9.07. Without limitation of the foregoing, each Lender
shall reimburse Administrative Agent upon demand for its ratable share of any
costs or out-of-pocket expenses (including Attorney Costs) incurred by
Administrative Agent in connection with the preparation, execution, delivery,
administration, modification, amendment, or enforcement (whether through
negotiations, legal proceedings or otherwise) of, or legal advice in respect of
rights or responsibilities under, this Agreement, any other Loan Document, or
any document contemplated by or referred to herein, to the extent that
Administrative Agent is not reimbursed for such expenses by or on behalf of
Borrowers. The undertaking in this Section 9.07 shall survive termination of the
Aggregate Commitments, the payment of all other Obligations and the resignation
of Administrative Agent.
Administrative Agent in its Individual Capacity. Bank of America and its
Affiliates may make loans to, issue letters of credit for the account of, accept
deposits from, acquire equity interests in, and generally engage in any kind of
banking, trust, financial advisory, underwriting, or other business with each of
the Loan Parties and their respective Affiliates as though Bank of America were
not Administrative Agent hereunder and without notice to or consent of Lenders.
Lenders acknowledge that, pursuant to such activities, Bank of America or its
Affiliates may receive information regarding any Loan Party or its Affiliates
(including information that may be subject to confidentiality obligations in
favor of such Loan Party or such Affiliate) and acknowledge that Administrative
Agent shall be under no obligation to provide such information to them. With
respect to its Loans, Bank of America or its Affiliates shall have the same
rights and powers under this Agreement as any other Lender and may exercise such
rights and powers as though it were not Administrative Agent, and the terms
"Lender" and "Lenders" include Bank of America or any Affiliate, as applicable,
in its individual capacity.
Successor Administrative Agent. Administrative Agent may resign as
Administrative Agent upon thirty (30) days' notice to Lenders. If Administrative
Agent resigns under this Agreement, the Required Lenders shall appoint from
among Lenders a successor administrative agent for Lenders, which successor
administrative agent shall be consented to by Borrowers at all times other than
during the existence of an Event of Default (which consent of Borrowers shall
not be unreasonably withheld or delayed). If no successor administrative agent
is appointed prior to the effective date of the resignation of Administrative
Agent, Administrative Agent may appoint, after consulting with Lenders and
Borrowers, a successor administrative agent from among Lenders. Upon the
acceptance of its appointment as successor administrative agent hereunder, the
Person acting as such successor administrative agent shall succeed to all the
rights, powers and duties of the retiring Administrative Agent and the term
"Administrative Agent" shall mean such successor administrative agent and the
retiring Administrative Agent's appointment, powers and duties as Administrative
Agent shall be terminated. After any retiring Administrative Agent's resignation
hereunder as Administrative Agent, the provisions of this Article IX and
Sections 10.04 and 10.05 shall inure to its benefit as to any actions taken or
omitted to be taken by it while it was Administrative Agent under this
Agreement. If no successor administrative agent has accepted appointment as
Administrative Agent by the date which is thirty (30) days following a retiring
Credit Agreement 68
Administrative Agent's notice of resignation, the retiring Administrative
Agent's resignation shall nevertheless thereupon become effective and Lenders
shall perform all of the duties of Administrative Agent hereunder until such
time, if any, as the Required Lenders appoint a successor agent as provided for
above.
Exercise of Rights; Proofs of Claim.
(a) No individual Lender or group of Lenders shall have any right to
amend or waive, or consent to the departure of any party from any provision of
any Loan Document, or secure or enforce the obligations of Borrowers or any
other party pursuant to the Loan Documents, or otherwise. All such rights, on
behalf of Administrative Agent or any Lender or Lenders, shall be held and
exercised solely by and at the option of Administrative Agent for the pro rata
benefit of Lenders. Such rights, however, are subject to the rights of a Lender
or Lenders, as expressly set forth in this Agreement, to approve matters or
direct Administrative Agent to take or refrain from taking action as set forth
in this Agreement. Except as expressly otherwise provided in this Agreement or
the other Loan Documents, Administrative Agent shall have and may use its sole
discretion with respect to exercising or refraining from exercising any
discretionary rights, or taking or refraining from taking any actions which
Administrative Agent is expressly entitled to exercise or take under this
Agreement and the other Loan Documents, including, without limitation, (i) the
determination if and to what extent matters or items subject to Administrative
Agent's satisfaction are acceptable or otherwise within its discretion, and (ii)
the exercise of remedies pursuant to, but subject to, Article 8 or pursuant to
any other Loan Document, and any action so taken or not taken shall be deemed
consented to by Lenders.
(b) In case of the pendency of any receivership, insolvency,
liquidation, bankruptcy, reorganization, arrangement, adjustment, composition,
or other judicial proceeding relative to Borrowers or any Guarantor, no
individual Lender or group of Lenders shall have the right, and Administrative
Agent (irrespective of whether the principal of the Loan shall then be due and
payable as herein expressed or by declaration or otherwise and irrespective of
whether Administrative Agent shall have made any demand on Borrowers) shall be
exclusively entitled and empowered on behalf of itself and Lenders, by
intervention in such proceeding or otherwise:
(i) to file and prove a claim for the whole amount of the
principal and interest owing and unpaid in respect of the Loan and all
other Obligations that are owing and unpaid and to file such other
documents as may be necessary or advisable in order to have the claims
of Lenders and Administrative Agent (including any claim for the
reasonable compensation, expenses, disbursements and advances of
Lenders and Administrative Agent and their respective agents and
counsel and all other amounts due Lenders and Administrative Agent
under Sections 2.04(i) and (j), 2.10 and 10.04) allowed in such
judicial proceeding; and
(ii) to collect and receive any monies or other property payable or
deliverable on any such claims and to distribute the same;
and any custodian, receiver, assignee, trustee, liquidator, sequestrator, or
other similar official in any such judicial proceeding is hereby authorized by
each Lender to make such payments to Administrative Agent and, in the event that
Administrative Agent shall consent to the making of such payments directly to
Lenders, to pay to Administrative Agent any amount due for the reasonable
compensation, expenses, disbursements and advances of Administrative Agent and
its agents and counsel, and any other amounts due Administrative Agent under
Sections 2.07 and 10.04.
Nothing contained herein shall be deemed to authorize Administrative Agent to
authorize or consent to or accept or adopt on behalf of any Lender any plan of
reorganization, arrangement, adjustment, or
Credit Agreement 69
composition affecting the Obligations or the rights of Lenders except as
approved by the Required Lenders or to authorize Administrative Agent to vote in
respect of the claims of Lenders except as approved by the Required Lenders in
any such proceeding.
Releases; Acquisition; and Transfers of Collateral.
(a) Lenders hereby irrevocably authorize Administrative Agent to release
its Lien, in accordance with Section 2.12, on the CMBS Collateral Properties to
be conveyed to a CMBS Borrower.
(b) Lenders hereby irrevocably authorize Administrative Agent to transfer
or release any lien on, or after foreclosure or other acquisition of title by
Administrative Agent on behalf of Lenders to transfer or sell, any Loan
collateral (i) upon the termination of the Aggregate Commitments and payment and
satisfaction in full of all Obligations; (ii) constituting a release, transfer,
or sale of a lien or property if Borrowers will certify to Administrative Agent
that the release, transfer, or sale is permitted under this Agreement or the
other Loan Documents (and Administrative Agent may rely conclusively on any such
certificate, without further inquiry); (iii) after foreclosure or other
acquisition of title (1) for a purchase price of ninety percent (90%) of the
value indicated in the most recent appraisal of the collateral obtained by
Administrative Agent made in accordance with regulations governing
Administrative Agent, less any reduction indicated in the appraisal estimated by
experts in such areas; or (2) if approved by the Required Lenders.
(c) If all or any portion of the Loan collateral is acquired by
foreclosure or by deed in lieu of foreclosure, Administrative Agent shall take
title to the collateral in its name or by an Affiliate of Administrative Agent,
but for the benefit of all Lenders in their Pro Rata Shares on the date of the
foreclosure sale or recordation of the deed in lieu of foreclosure (the
"Acquisition Date"). Administrative Agent and all Lenders hereby expressly waive
and relinquish any right of partition with respect to any collateral so
acquired. After any collateral is acquired, Administrative Agent shall appoint
and retain one or more Persons (individually and collectively, "Property
Manager" ) experienced in the management, leasing, sale, and/or dispositions of
similar properties.
After consulting with the Property Manager, Administrative Agent shall prepare a
written plan for completion of construction (if required), operation,
management, improvement, maintenance, repair, sale, and disposition of the Loan
collateral and a budget for the aforesaid, which may include a reasonable
management fee payable to Administrative Agent (the "Business Plan").
Administrative Agent will deliver the Business Plan not later than the sixtieth
(60th) day after the Acquisition Date to each Lender with a written request for
approval of the Business Plan. If the Business Plan is approved by the Required
Lenders, Administrative Agent and the Property Manager shall adhere to the
Business Plan until a different Business Plan is approved by the Required
Lenders. Administrative Agent may propose an amendment to the Business Plan as
it deems appropriate, which shall also be subject to Required Lender approval.
If the Business Plan (as may be amended) proposed by Administrative Agent is not
approved by the Required Lenders, (or if sixty (60) days have elapsed following
the Acquisition Date without a Business Plan being proposed by Administrative
Agent), any Lender may propose an alternative Business Plan, which
Administrative Agent shall submit to all Lenders for their approval. If an
alternative Business Plan is approved by the Required Lenders, Administrative
Agent may appoint one of the approving Lenders to implement the alternative
Business Plan. Notwithstanding any other provision of this Agreement, unless in
violation of an approved Business Plan or otherwise in an emergency situation,
Administrative Agent shall, subject to subsection (a) of this Section, have the
right but not the obligation to take any action in connection with the Loan
collateral (including those with respect to property taxes, insurance premiums,
operation, management, improvement, maintenance, repair, sale, and disposition),
or any portion thereof.
Credit Agreement 70
(d) Upon request by Administrative Agent or Borrowers at any time,
Lenders will confirm in writing Administrative Agent's authority to sell,
transfer or release any such liens of particular types or items of Loan
collateral pursuant to this Section 9.11(d); provided, however, that (i)
Administrative Agent shall not be required to execute any document necessary to
evidence such release, transfer or sale on terms that, in Administrative Agent's
opinion, would expose Administrative Agent to liability or create any obligation
or entail any consequence other than the transfer, release, or sale without
recourse, representation or warranty, and (ii) such transfer, release, or sale
shall not in any manner discharge, affect or impair the obligations of Borrowers
other than those expressly being released.
(e) If only two (2) Lenders exist at the time Administrative Agent
receives a purchase offer for Loan collateral for which one of Lenders does not
consent within ten (10) Business Days after notification from Administrative
Agent, the consenting Lender may offer ( "Purchase Offer") to purchase all of
non-consenting Lender's right, title and interest in the collateral for a
purchase price equal to non-consenting Lender's Pro Rata Share of the net
proceeds anticipated from such sale of such collateral (as reasonably determined
by Administrative Agent, including the undiscounted face principal amount of any
purchase money obligation not payable at closing) ("Net Proceeds"). Within ten
(10) Business Days thereafter the non-consenting Lender shall be deemed to have
accepted such Purchase Offer unless the non-consenting Lender notifies
Administrative Agent that it elects to purchase all of the consenting Lender's
right, title and interest in the collateral for a purchase price payable by the
non-consenting Lender in an amount equal to the consenting Lender's Pro Rata
Share of the Net Proceeds. Any amount payable hereunder by a Lender shall be due
on the earlier to occur of the closing of the sale of the collateral or 90 days
after the Purchase Offer, regardless of whether the collateral has been sold.
Other Agents, Arrangers, and Managers. None of the Lenders or other Persons
identified on the facing page or signature pages of this Agreement as a
"syndication agent," "documentation agent," "co-agent," "book manager," "lead
manager," "arranger," "lead arranger" or "co-arranger" shall have any right,
power, obligation, liability, responsibility, or duty under this Agreement other
than, in the case of such Lenders, those applicable to all Lenders as such.
Without limiting the foregoing, none of the Lenders or other Persons so
identified shall have or be deemed to have any fiduciary relationship with any
Lender. Each Lender acknowledges that it has not relied, and will not rely, on
any of the Lenders or other Persons so identified in deciding to enter into this
Agreement or in taking or not taking action hereunder.
MISCELLANEOUS
Amendments, Etc. Administrative Agent and Lenders shall be entitled to
amend (whether pursuant to a separate intercreditor agreement or otherwise) any
of the terms, conditions or agreements set forth in Article 9 or as to any other
matter in the Loan Documents respecting payments to Administrative Agent or
Lenders or the required number of Lenders to approve or disapprove any matter or
to take or refrain from taking any action, without the consent of Borrowers or
any other Person or the execution by Borrowers or any other Person of any such
amendment or intercreditor agreement. Subject to the foregoing, Administrative
Agent may amend or waive any provision of this Agreement or any other Loan
Document, or consent to any departure by any party to the Loan Documents
therefrom which amendment, waiver, or consent is intended to be within
Administrative Agent's discretion or determination, or otherwise in
Administrative Agent's reasonable determination shall not have a Material
Adverse Effect; provided however, otherwise no such amendment, waiver, or
consent shall be effective unless in writing, signed by the Required Lenders and
Borrowers or the applicable party to the Loan Documents, as the case may be, and
acknowledged by Administrative Agent, and each such waiver or consent shall be
effective only in the specific instance and for the specific purpose for which
given; provided further however, no such amendment, waiver, or consent shall:
Credit Agreement 71
(a) extend or increase the Commitment of any Lender (or reinstate any
Commitment terminated pursuant to Section 8.02), without the written consent of
such Lender (it being understood that a waiver of a Default shall not constitute
an extension or increase in any Lender's Commitment);
(b) postpone any date fixed by this Agreement or any other Loan Document
for any payment of principal, interest, fees, or other amounts due to Lenders
(or any of them) hereunder or under any other Loan Document, without the written
consent of each Lender directly affected thereby;
(c) reduce the principal of, or the rate of interest specified herein on,
any portion of the Loan, or any fees or other amounts payable hereunder or under
any other Loan Document without the written consent of each Lender directly
affected thereby; provided, however, that Administrative Agent may waive any
obligation of Borrowers to pay interest at the Default Rate for periods of up to
thirty (30) days, and only the consent of the Required Lenders shall be
necessary to waive any obligation of Borrowers to pay interest at the Default
Rate or late charges thereafter, or to amend the definition of "Default Rate;"
(d) change the definition of "Required Lenders" or any other provision
hereof specifying the number or percentage of Lenders required to amend, waive
or otherwise modify any rights hereunder or make any determination or grant any
consent hereunder, without the written consent of each Lender;
(e) amend this Section 10.01, or change Section 2.11 or Section 8.03 in a
manner that would alter the pro rata sharing of payments required thereby,
without the written consent of each Lender;
(f) release the liability of Borrowers or any existing Guarantor, if
applicable, without the written consent of each Lender, except as provided in
Section 9.11;
(g) permit the sale, transfer, pledge, mortgage, or assignment of any
Loan collateral or any direct or indirect interest in Borrowers, except as
expressly permitted under the Loan Documents, without the written consent of
each Lender; or
(h) transfer or release any lien on, or after foreclosure or other
acquisition of title by Administrative Agent on behalf of Lenders transfer or
sell, any Loan collateral except as permitted in Section 9.11, without the
written consent of each Lender.
and, provided further, that (i) no amendment, waiver, or consent shall, unless
in writing and signed by Administrative Agent in addition to Lenders required
above, affect the rights or duties of Administrative Agent under this Agreement
or any other Loan Document; and (ii) the Fee Letter may be amended, or rights or
privileges thereunder waived, in a writing executed only by the parties thereto.
Notwithstanding anything to the contrary herein, no Defaulting Lender shall have
any right to approve or disapprove any amendment, waiver or consent hereunder,
except that the Commitment of such Lender may not be increased or extended
without the consent of such Lender.
Notices and Other Communications; Facsimile Copies.
(a) General. Unless otherwise expressly provided herein, all notices and
other communications provided for hereunder shall be in writing (including by
facsimile transmission). All such written notices shall be mailed, faxed or
delivered to the applicable address, facsimile number, or (subject to Section
10.02(c) below) electronic mail address, and all notices and other
communications expressly permitted hereunder to be given by telephone shall be
made to the applicable telephone number, as follows:
Credit Agreement 72
(i) if to Borrowers or Administrative Agent, to the address,
facsimile number, electronic mail address, or telephone number specified
for such Person on Schedule 10.02 or to such other address, facsimile
number, electronic mail address, or telephone number as shall be designated
by such party in a notice to the other parties; and
(ii) if to any other Lender, to the address, facsimile number,
electronic mail address, or telephone number specified in its
Administrative Questionnaire or to such other address, facsimile number,
electronic mail address, or telephone number as shall be designated by such
party in a notice to Borrowers or Administrative Agent.
All such notices and other communications shall be deemed to be given or made
upon the earlier to occur of (i) actual receipt by the relevant party hereto and
(ii) (A) if delivered by hand or by courier, when signed for by or on behalf of
the relevant party hereto; (B) if delivered by mail, four (4) Business Days
after deposit in the mails, postage prepaid; (C) if delivered by facsimile, when
sent and receipt has been confirmed by telephone; and (D) if delivered by
electronic mail (which form of delivery is subject to the provisions of
subsection (c) below), when delivered; provided, however, that notices and other
communications to Administrative Agent pursuant to Article II shall not be
effective until actually received by such Person. In no event shall a voicemail
message be effective as a notice, communication or confirmation hereunder.
(b) Effectiveness of Facsimile Documents and Signatures. Loan Documents
may be transmitted and/or signed by facsimile. The effectiveness of any such
documents and signatures shall, subject to applicable Law, have the same force
and effect as manually-signed originals and shall be binding on all Loan
Parties, Administrative Agent and Lenders. Administrative Agent may also require
that any such documents and signatures be confirmed by a manually-signed
original thereof; provided, however, that the failure to request or deliver the
same shall not limit the effectiveness of any facsimile document or signature.
(c) Limited Use of Electronic Mail. Electronic mail and Internet and
intranet websites may be used only to distribute routine communications, such as
financial statements and other information as provided in Section 6.02 , and to
distribute Loan Documents for execution by the parties thereto, and may not be
used for any other purpose.
(d) Reliance by Administrative Agent and Lenders. Administrative Agent
and Lenders shall be entitled to rely and act upon any notices (including
telephonic Loan Notices) purportedly given by or on behalf of Borrowers even if
(i) such notices were not made in a manner specified herein, were incomplete or
were not preceded or followed by any other form of notice specified herein, or
(ii) the terms thereof, as understood by the recipient, varied from any
confirmation thereof. Borrowers shall indemnify each Agent-Related Person and
each Lender from all losses, costs, expenses, and liabilities resulting from the
reliance by such Person on each notice purportedly given by or on behalf of
Borrowers. All telephonic notices to and other communications with
Administrative Agent may be recorded by Administrative Agent, and each of the
parties hereto hereby consents to such recording.
No Waiver; Cumulative Remedies. No failure by any Lender or Administrative
Agent to exercise, and no delay by any such Person in exercising, any right,
remedy, power or privilege hereunder shall operate as a waiver thereof; nor
shall any single or partial exercise of any right, remedy, power or privilege
hereunder preclude any other or further exercise thereof or the exercise of any
other right, remedy, power or privilege. The rights, remedies, powers and
privileges herein provided are cumulative and not exclusive of any rights,
remedies, powers, and privileges provided by law.
Credit Agreement 73
Attorney Costs, Expenses and Taxes. Borrowers jointly and severally agree
(a) to pay or reimburse Administrative Agent for all costs and expenses incurred
in connection with the development, preparation, negotiation and execution of
this Agreement and the other Loan Documents and any amendment, waiver, consent
or other modification of the provisions hereof and thereof (whether or not the
transactions contemplated hereby or thereby are consummated), and the
consummation and administration of the transactions contemplated hereby and
thereby, including all Attorney Costs, and (b) to pay or reimburse
Administrative Agent and each Lender for all costs and expenses incurred in
connection with the enforcement, attempted enforcement, or preservation of any
rights or remedies under this Agreement or the other Loan Documents (including
all such costs and expenses incurred during any "workout" or restructuring in
respect of the Obligations and during any legal proceeding, including any
proceeding under any Debtor Relief Law), including all Attorney Costs, and
including with respect to (a) and (b) above: (i) fees and charges of any
construction consultant, inspector and/or engineer; (ii) appraisal, re-appraisal
and survey costs; (iii) title insurance charges and premiums; (iv) title search
or examination costs, including abstracts, abstractors' certificates and uniform
commercial code searches; (v) judgment and tax lien searches for Borrowers and
each Guarantor; (vi) escrow fees; (vii) fees and costs of environmental
investigations site assessments and remediations; (viii) recordation taxes,
documentary taxes, transfer taxes and mortgage taxes; (ix) filing and recording
fees; and (x) loan brokerage fees. The foregoing costs and expenses shall
include all search, filing, recording, title insurance and appraisal charges and
fees and taxes related thereto, and other out-of-pocket expenses incurred by
Administrative Agent and the cost of independent public accountants and other
outside experts retained by Administrative Agent or any Lender. All amounts due
under this Section 10.04 shall be payable within ten (10) Business Days after
demand therefor. The agreements in this Section shall survive the termination of
the Aggregate Commitments and repayment of all other Obligations.
Indemnification by Parent and Borrowers. Whether or not the transactions
contemplated hereby are consummated, Parent and Borrowers, jointly and
severally, shall indemnify and hold harmless each Agent-Related Person, each
Lender, and their respective Affiliates, directors, officers, employees,
counsel, agents, and attorneys-in-fact (collectively the "Indemnitees") from and
against any and all liabilities, obligations, losses, damages, penalties,
claims, demands, actions, judgments, suits, costs, expenses, and disbursements
(including Attorney Costs) of any kind or nature whatsoever which may at any
time be imposed on, incurred by or asserted against any such Indemnitee in any
way relating to or arising out of or in connection with (a) the execution,
delivery, enforcement, performance, or administration of any Loan Document or
any other agreement, letter or instrument delivered in connection with the
transactions contemplated thereby or the consummation of the transactions
contemplated thereby, (b) any Commitment or Loan or the use or proposed use of
the proceeds therefrom, (c) (i) defect in any Collateral Property, (ii)
performance or default of either Borrower, Borrowers' surveyors, architects,
engineers, contractors, or any other person, (iii) failure to protect or insure
the Improvements, (iv) payment of costs of labor, materials, or services
supplied for the Improvements, or (v) Environmental Damages, or (d) any actual
or prospective claim, litigation, investigation or proceeding relating to any of
the foregoing, whether based on contract, tort or any other theory (including
any investigation of, preparation for, or defense of any pending or threatened
claim, investigation, litigation or proceeding) and regardless of whether any
Indemnitee is a party thereto (all the foregoing, collectively, the "Indemnified
Liabilities"), in all cases, whether or not caused by or arising, in whole or in
part, out of the negligence of the Indemnitee; provided that such indemnity
shall not, as to any Indemnitee, be available to the extent that such
liabilities, obligations, losses, damages, penalties, claims, demands, actions,
judgments, suits, costs, expenses, or disbursements are determined by a court of
competent jurisdiction by final and nonappealable judgment to have resulted from
the gross negligence or willful misconduct of such Indemnitee. No Indemnitee
shall be liable for any damages arising from the use by others of any
information or other materials obtained through IntraLinks or other similar
information transmission systems in connection with this Agreement, nor shall
any Indemnitee have any liability for any indirect or consequential damages
relating to this Agreement or any other Loan Document or arising
Credit Agreement 74
out of its activities in connection herewith or therewith (whether before or
after the Closing Date). All amounts due under this Section 10.05 shall be
payable within ten (10) Business Days after demand therefor. The agreements in
this Section 10.05 shall survive the resignation of Administrative Agent, the
replacement of any Lender, the termination of the Aggregate Commitments and the
repayment, satisfaction or discharge of all the other Obligations. Any
requirement of this Agreement which provides for the approval or consent of
Administrative Agent or any Lender with respect to any matter pertaining to a
Borrowing, not otherwise specifically set forth in detail, shall be deemed to
call for performance that is reasonable under the circumstances. In the event
that a requirement of reasonable performance shall nevertheless be deemed too
vague or uncertain as to allow legal enforcement, such requirement shall be
deemed null and void, but without effect on the enforceability of this Agreement
or any other requirement contained herein with respect to a Borrowing.
Notwithstanding any approvals or consents by Administrative Agent or Lenders,
neither Administrative Agent nor any Lender has any obligation or responsibility
whatsoever for the adequacy, form or content of the Plans, any budget, any
contract, any change order, any lease, or any other matter incident to any
Collateral Property or the Improvements. Any inspection or audit of any
Collateral Property or the books and records of Borrowers, or the procuring of
documents and financial and other information, by or on behalf of Administrative
Agent shall be for Administrative Agent and Lenders' protection only, and shall
not constitute an assumption of responsibility to Borrowers or anyone else with
regard to the condition, construction, maintenance, or operation of any
Collateral Property, or relieve Borrowers of any of their obligations. Borrowers
have selected all surveyors, architects, engineers, contractors, materialmen,
and all other persons or entities furnishing services or materials to any
Collateral Property. Neither Administrative Agent nor any Lender has any duty to
supervise or to inspect the Collateral Property nor any duty of care to
Borrowers or any other person to protect against, or inform Borrowers or any
other person of the existence of, negligent, faulty, inadequate, or defective
design or construction of the Improvements. Upon demand by Administrative Agent,
Parent and Borrowers shall diligently defend any of the Indemnified Liabilities
which affects any Collateral Property or is made or commenced against
Administrative Agent or any Lender, whether alone or together with any other
person, all at Parent's and Borrowers ` own cost and expense and by counsel to
be approved by Administrative Agent in the exercise of its reasonable judgment.
In the alternative, at any time Administrative Agent may elect to conduct its
own defense on behalf of itself or any Lender through counsel selected by
Administrative Agent and at the cost and expense of Parent and Borrowers.
Nothing, including any advance or acceptance of any document or instrument,
shall be construed as a representation or warranty, express or implied, to any
party by Administrative Agent or Lenders. Inspection shall not constitute an
acknowledgment or representation by Administrative Agent or Lenders that there
has been or will be compliance with the Plans, the Loan Documents, or applicable
Laws and restrictive covenants, or that the construction is free from defective
materials or workmanship. Inspection, whether or not followed by notice of
Default, shall not constitute a waiver of any Default then existing.
Administrative Agent's failure to inspect shall not constitute a waiver of any
of Administrative Agent's or Lenders' rights under the Loan Documents or at Law
or in equity.
To the extent, if at all, that NMSA Section 56-7-1 is applicable to this
Agreement, any indemnification will not extend to liability, claims, damages,
losses, or expenses, including Attorney Costs, arising out of (A) the
preparation or approval of maps, drawings, opinions, reports, surveys, change
orders, designs, or specifications by indemnitee, or the agents or employees of
indemnitee, and (B) the giving of or the failure to give direction or
instructions by indemnitee, or the agents or employees of indemnitee, where such
giving or failure to give directions or instructions is the primary cause of
bodily injury to persons or damage.
Payments Set Aside. To the extent that any payment by or on behalf of
Borrowers is made to Administrative Agent or any Lender, or Administrative Agent
or any Lender exercises its right of set-off, and such payment or the proceeds
of such set-off or any part thereof is subsequently invalidated, declared
75
to be fraudulent or preferential, set aside or required (including pursuant to
any settlement entered into by Administrative Agent or such Lender in its
discretion) to be repaid to a trustee, receiver or any other party, in
connection with any proceeding under any Debtor Relief Law or otherwise, then
(a) to the extent of such recovery, the obligation or part thereof originally
intended to be satisfied shall be revived and continued in full force and effect
as if such payment had not been made or such set-off had not occurred, and (b)
each Lender severally agrees to pay to Administrative Agent upon demand its
applicable share of any amount so recovered from or repaid by Administrative
Agent, plus interest thereon from the date of such demand to the date such
payment is made at a rate per annum equal to the Federal Funds Rate from time to
time in effect.
Successors and Assigns.
(a) The provisions of this Agreement shall be binding upon and inure to
the benefit of the parties hereto and their respective successors and assigns
permitted hereby, except that Borrowers may not assign or otherwise transfer any
of their rights or obligations hereunder without the prior written consent of
each Lender and no Lender may assign or otherwise transfer any of its rights or
obligations hereunder except (i) to an Eligible Assignee in accordance with the
provisions of Section 10.07(b), (ii) by way of participation in accordance with
the provisions of Section 10.07(d), or (iii) by way of pledge or assignment of a
security interest subject to the restrictions of Section 10.07(f) (and any other
attempted assignment or transfer by any party hereto shall be null and void).
Nothing in this Agreement, expressed or implied, shall be construed to confer
upon any Person (other than the parties hereto, their respective successors and
assigns permitted hereby, Participants to the extent provided in Section
10.07(d) and, to the extent expressly contemplated hereby, the Indemnitees) any
legal or equitable right, remedy, or claim under or by reason of this Agreement.
(b) Any Lender may at any time assign to one or more Eligible Assignees
all or a portion of its rights and obligations under this Agreement (including
all or a portion of its Commitment and the Loans at the time owing to it);
provided that: (i) except in the case of an assignment of the entire remaining
amount of the assigning Lender's Commitment and the Loans at the time owing to
it or in the case of an assignment to a Lender or an Affiliate of a Lender or an
Approved Fund (as defined in Section 10.07(g)) with respect to a Lender, the
aggregate amount of the Commitment (which for this purpose includes Loans
outstanding thereunder) subject to each such assignment, determined as of the
date the Assignment and Assumption with respect to such assignment is delivered
to Administrative Agent or, if "Trade Date" is specified in the Assignment and
Assumption, as of the Trade Date, shall not be less than $5,000,000 or a whole
multiple of $500,000 in excess thereof, and after such assignment no Lender
shall hold a Commitment of less than $5,000,000, unless each of Administrative
Agent and, so long as no Default or Event of Default has occurred and is
continuing, Borrowers otherwise consent (each such consent not to be
unreasonably withheld or delayed); (ii) each partial assignment shall be made as
an assignment of a proportionate part of all the assigning Lender's rights and
obligations under this Agreement with respect to the Loans or the Commitment
assigned; (iii) any assignment of a Commitment must be approved by
Administrative Agent unless the Person that is the proposed assignee is itself a
Lender (whether or not the proposed assignee would otherwise qualify as an
Eligible Assignee); and (iv) the parties to each assignment shall execute and
deliver to Administrative Agent an Assignment and Assumption, together with a
processing and recordation fee of $3,500. Subject to acceptance and recording
thereof by Administrative Agent pursuant to Section 10.07(c), from and after the
effective date specified in each Assignment and Assumption, the Eligible
Assignee thereunder shall be a party to this Agreement and, to the extent of the
interest assigned by such Assignment and Assumption, have the rights and
obligations of a Lender under this Agreement, and the assigning Lender
thereunder shall, to the extent of the interest assigned by such Assignment and
Assumption, be released from its obligations under this Agreement (and, in the
case of an Assignment and Assumption covering all of the assigning Lender's
rights and obligations under this Agreement, such Lender shall cease to be a
party hereto but
76
shall continue to be entitled to the benefits of Sections 3.01, 3.04, 3.05,
10.04, and 10.05 with respect to facts and circumstances occurring prior to the
effective date of such assignment). Upon request, Borrowers (at its expense)
shall execute and deliver a Note to the assignee Lender. Any assignment or
transfer by a Lender of rights or obligations under this Agreement that does not
comply with this subsection shall be treated for purposes of this Agreement as a
sale by such Lender of a participation in such rights and obligations in
accordance with Section 10.07(d).
(c) Administrative Agent, acting solely for this purpose as an agent of
Borrowers, shall maintain at Administrative Agent's Office a copy of each
Assignment and Assumption delivered to it and a register for the recordation of
the names and addresses of Lenders, and the Commitments of, and principal
amounts of the Loans owing to, each Lender pursuant to the terms hereof from
time to time (the "Register"). The entries in the Register shall be conclusive,
and Borrowers, Administrative Agent, and Lenders may treat each Person whose
name is recorded in the Register pursuant to the terms hereof as a Lender
hereunder for all purposes of this Agreement, notwithstanding notice to the
contrary. The Register shall be available for inspection by Borrowers and any
Lender, at any reasonable time and from time to time upon reasonable prior
notice.
(d) Any Lender may at any time, without the consent of, or notice to,
Borrowers or Administrative Agent, sell participations to any Person (other than
a natural person or Borrowers or any of Borrowers' Affiliates or Subsidiaries)
(each, a "Participant") in all or a portion of such Lender's rights and/or
obligations under this Agreement (including all or a portion of its Commitment
and/or the Loans owing to it); provided that (i) such Lender's obligations under
this Agreement shall remain unchanged, (ii) such Lender shall remain solely
responsible to the other parties hereto for the performance of such obligations
and (iii) Borrowers, Administrative Agent, and the other Lenders shall continue
to deal solely and directly with such Lender in connection with such Lender's
rights and obligations under this Agreement. Any agreement or instrument
pursuant to which a Lender sells such a participation shall provide that such
Lender shall retain the sole right to enforce this Agreement and to approve any
amendment, modification or waiver of any provision of this Agreement; provided
that such agreement or instrument may provide that such Lender will not, without
the consent of the Participant, agree to any amendment, waiver or other
modification described in the first proviso to Section 10.01 that directly
affects such Participant. Subject to subsection (e) of this Section 10.07,
Borrowers agree that each Participant shall be entitled to the benefits of
Sections 3.01, 3.04 and 3.05 to the same extent as if it were a Lender and had
acquired its interest by assignment pursuant to subsection (b) of this Section
10.07. To the extent permitted by law, each Participant also shall be entitled
to the benefits of Section 10.09 as though it were a Lender, provided such
Participant agrees to be subject to Section 2.13 as though it were a Lender.
(e) A Participant shall not be entitled to receive any greater payment
under Section 3.01 or 3.04 than the applicable Lender would have been entitled
to receive with respect to the participation sold to such Participant, unless
the sale of the participation to such Participant is made with Borrowers' prior
written consent. A Participant that would be a Foreign Lender if it were a
Lender shall not be entitled to the benefits of Section 3.01 unless Borrowers
are notified of the participation sold to such Participant and such Participant
agrees, for the benefit of Borrowers, to comply with Section 10.15 as though it
were a Lender.
(f) Any Lender may at any time pledge or assign a security interest in
all or any portion of its rights under this Agreement (including under its Note,
if any) to secure obligations of such Lender, including any pledge or assignment
to secure obligations to a Federal Reserve Bank; provided that no such pledge or
assignment shall release such Lender from any of its obligations hereunder or
substitute any such pledgee or assignee for such Lender as a party hereto.
77
(g) As used herein, the following terms have the following meanings:
"Eligible Assignee" means (a) a Lender; (b) an Affiliate of a
Lender; (c) an Approved Fund; and (d) any other Person (other than a natural
person) approved by (i) Administrative Agent, and (ii) unless a Default or Event
of Default has occurred and is continuing, Borrowers (each such approval not to
be unreasonably withheld or delayed); provided that notwithstanding the
foregoing, "Eligible Assignee" shall not include Borrowers or any of Borrowers'
Affiliates or Subsidiaries.
"Fund" means any Person (other than a natural person) that is (or
will be) engaged in making, purchasing, holding or otherwise investing in
commercial loans and similar extensions of credit in the ordinary course of its
business.
"Approved Fund" means any Fund that is administered or managed by
(a) a Lender, (b) an Affiliate of a Lender or (c) an entity or an Affiliate of
an entity that administers or manages a Lender, in each such case which has
sufficient liquidity to fully fund its Commitment.
Confidentiality. Each of Administrative Agent and Lenders agrees to
maintain the confidentiality of the Information (as defined below), except that
Information may be disclosed (a) to its and its Affiliates' directors, officers,
employees and agents, including accountants, legal counsel and other advisors
(it being understood that the Persons to whom such disclosure is made will be
informed of the confidential nature of such Information and instructed to keep
such Information confidential), (b) to the extent requested by any regulatory
authority (including any self-regulatory authority, such as the National
Association of Insurance Commissioners), (c) to the extent required by
applicable laws or regulations or by any subpoena or similar legal process, (d)
to any other party hereto, (e) in connection with the exercise of any remedies
hereunder or under any other Loan Document or any action or proceeding relating
to this Agreement or any other Loan Document or the enforcement of rights
hereunder or thereunder, (f) subject to an agreement containing provisions
substantially the same as those of this Section 10.08, to (i) any assignee of or
Participant in, or any prospective assignee of or Participant in, any of its
rights or obligations under this Agreement or (ii) any actual or prospective
counterparty (or its advisors) to any swap or derivative transaction relating to
Borrowers and their obligations, (g) with the consent of Borrowers, or (h) to
the extent such Information (x) becomes publicly available other than as a
result of a breach of this Section 10.08 or (y) becomes available to
Administrative Agent or any Lender on a nonconfidential basis from a source
other than Borrowers. For purposes of this Section 10.08, "Information" means
all information received from any Loan Party relating to any Loan Party or any
of their respective businesses, other than any such information that is
available to Administrative Agent or any Lender on a nonconfidential basis prior
to disclosure by any Loan Party, provided that, in the case of information
received from a Loan Party after the date hereof, such information is clearly
identified at the time of delivery as confidential. Any Person required to
maintain the confidentiality of Information as provided in this Section 10.08
shall be considered to have complied with its obligation to do so if such Person
has exercised the same degree of care to maintain the confidentiality of such
Information as such Person would accord to its own confidential information.
Notwithstanding anything herein to the contrary, "Information" shall not
include, and Administrative Agent and each Lender may disclose without
limitation of any kind, any information with respect to the "tax treatment" and
"tax structure" (in each case, within the meaning of Treasury Regulation Section
1.6011-4) of the transactions contemplated hereby and all materials of any kind
(including opinions or other tax analyses) that are provided to Administrative
Agent or such Lender relating to such tax treatment and tax structure; provided
that with respect to any document or similar item that in either case contains
information concerning the tax treatment or tax structure of the transaction as
well as other information, this sentence shall only apply to such portions of
the document or similar item that relate to the tax treatment or tax structure
of the Loans and transactions contemplated hereby.
Credit Agreement 78
Set-off. In addition to any rights and remedies of Lenders provided by law,
upon the occurrence and during the continuance of any Event of Default, each
Lender is authorized at any time and from time to time, without prior notice to
Borrowers or any other Loan Party, any such notice being waived by Borrowers (on
their own behalf and on behalf of each Loan Party) to the fullest extent
permitted by law, to set off and apply any and all deposits (general or special,
time or demand, provisional or final) at any time held by, and other
indebtedness at any time owing by, such Lender to or for the credit or the
account of the respective Loan Parties against any and all Obligations owing to
such Lender hereunder or under any other Loan Document, now or hereafter
existing, irrespective of whether or not Administrative Agent or such Lender
shall have made demand under this Agreement or any other Loan Document and
although such Obligations may be contingent or unmatured or denominated in a
currency different from that of the applicable deposit or indebtedness. Each
Lender agrees promptly to notify Borrowers and Administrative Agent after any
such set-off and application made by such Lender; provided, however, that the
failure to give such notice shall not affect the validity of such set-off and
application.
Interest Rate Limitation. Notwithstanding anything to the contrary
contained in any Loan Document, the interest paid or agreed to be paid under the
Loan Documents shall not exceed the maximum rate of non-usurious interest
permitted by applicable Law (the "Maximum Rate"). If Administrative Agent or any
Lender shall receive interest in an amount that exceeds the Maximum Rate, the
excess interest shall be applied to the principal of the Loans or, if it exceeds
such unpaid principal, refunded to Borrowers. In determining whether the
interest contracted for, charged, or received by Administrative Agent or a
Lender exceeds the Maximum Rate, such Person may, to the extent permitted by
applicable Law, (a) characterize any payment that is not principal as an
expense, fee, or premium rather than interest, (b) exclude voluntary prepayments
and the effects thereof, and (c) amortize, prorate, allocate, and spread in
equal or unequal parts the total amount of interest throughout the contemplated
term of the Obligations hereunder.
Counterparts. This Agreement may be executed in one or more counterparts,
each of which shall be deemed an original, but all of which together shall
constitute one and the same instrument.
Integration. This Agreement, together with the other Loan Documents,
comprises the complete and integrated agreement of the parties on the subject
matter hereof and thereof and supersedes all prior agreements, written or oral,
on such subject matter. In the event of any conflict between the provisions of
this Agreement and those of any other Loan Document, the provisions of this
Agreement shall control; provided that the inclusion of supplemental rights or
remedies in favor of Administrative Agent or Lenders in any other Loan Document
shall not be deemed a conflict with this Agreement. Each Loan Document was
drafted with the joint participation of the respective parties thereto and shall
be construed neither against nor in favor of any party, but rather in accordance
with the fair meaning thereof.
Survival of Representations and Warranties. All representations and
warranties made hereunder and in any other Loan Document or other document
delivered pursuant hereto or thereto or in connection herewith or therewith
shall survive the execution and delivery hereof and thereof. Such
representations and warranties have been or will be relied upon by
Administrative Agent and each Lender, regardless of any investigation made by
Administrative Agent or any Lender or on their behalf and notwithstanding that
Administrative Agent or any Lender may have had notice or knowledge of any
Default at the time of any Borrowing, and shall continue in full force and
effect as long as any Loan or any other Obligation hereunder shall remain unpaid
or unsatisfied.
Severability. If any provision of this Agreement or the other Loan
Documents is held to be illegal, invalid or unenforceable, (a) the legality,
validity, and enforceability of the remaining provisions of this Agreement and
the other Loan Documents shall not be affected or impaired thereby and (b) the
parties shall endeavor in good faith negotiations to replace the illegal,
invalid or unenforceable provisions
Credit Agreement 79
with valid provisions the economic effect of which comes as close as possible to
that of the illegal, invalid or unenforceable provisions. The invalidity of a
provision in a particular jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
Tax Forms. (a) (i) Each Lender that is not a "United States person" within
the meaning of Section 7701(a)(30) of the Code (a "Foreign Lender") shall
deliver to Administrative Agent, prior to receipt of any payment subject to
withholding under the Code (or upon accepting an assignment of an interest
herein), two duly signed completed copies of either IRS Form W-8BEN or any
successor thereto (relating to such Foreign Lender and entitling it to an
exemption from, or reduction of, withholding tax on all payments to be made to
such Foreign Lender by Borrowers pursuant to this Agreement) or IRS Form W-8ECI
or any successor thereto (relating to all payments to be made to such Foreign
Lender by Borrowers pursuant to this Agreement) or such other evidence
satisfactory to Borrowers and Administrative Agent that such Foreign Lender is
entitled to an exemption from, or reduction of, U.S. withholding tax, including
any exemption pursuant to Section 881(c) of the Code. Thereafter and from time
to time, each such Foreign Lender shall (A) promptly submit to Administrative
Agent such additional duly completed and signed copies of one of such forms (or
such successor forms as shall be adopted from time to time by the relevant
United States taxing authorities) as may then be available under then current
United States laws and regulations to avoid, or such evidence as is satisfactory
to Borrowers and Administrative Agent of any available exemption from or
reduction of, United States withholding taxes in respect of all payments to be
made to such Foreign Lender by Borrowers pursuant to this Agreement, (B)
promptly notify Administrative Agent of any change in circumstances which would
modify or render invalid any claimed exemption or reduction, and (C) take such
steps as shall not be materially disadvantageous to it, in the reasonable
judgment of such Lender, and as may be reasonably necessary (including the
re-designation of its Lending Office) to avoid any requirement of applicable
Laws that Borrowers make any deduction or withholding for taxes from amounts
payable to such Foreign Lender.
(ii) Each Foreign Lender, to the extent it does not act or ceases to act
for its own account with respect to any portion of any sums paid or payable to
such Lender under any of the Loan Documents (for example, in the case of a
typical participation by such Lender), shall deliver to Administrative Agent on
the date when such Foreign Lender ceases to act for its own account with respect
to any portion of any such sums paid or payable, and at such other times as may
be necessary in the determination of Administrative Agent (in the reasonable
exercise of its discretion), (A) two duly signed completed copies of the forms
or statements required to be provided by such Lender as set forth above, to
establish the portion of any such sums paid or payable with respect to which
such Lender acts for its own account that is not subject to U.S. withholding
tax, and (B) two duly signed completed copies of IRS Form W-8IMY (or any
successor thereto), together with any information such Lender chooses to
transmit with such form, and any other certificate or statement of exemption
required under the Code, to establish that such Lender is not acting for its own
account with respect to a portion of any such sums payable to such Lender.
(iii) Borrowers shall not be required to pay any additional amount to any
Foreign Lender under Section 3.01 (A) with respect to any Taxes required to be
deducted or withheld on the basis of the information, certificates or statements
of exemption such Lender transmits with an IRS Form W-8IMY pursuant to this
Section 10.15(a) or (B) if such Lender shall have failed to satisfy the
foregoing provisions of this Section 10.15(a) ; provided that if such Lender
shall have satisfied the requirement of this Section 10.15(a) on the date such
Lender became a Lender or ceased to act for its own account with respect to any
payment under any of the Loan Documents, nothing in this Section 10.15(a) shall
relieve Borrowers of their obligation to pay any amounts pursuant to Section
3.01 in the event that, as a result of any change in any applicable law, treaty,
or governmental rule, regulation, or order, or any change in the interpretation,
administration, or application thereof, such Lender is no longer properly
entitled to deliver forms, certificates or other evidence at a subsequent date
establishing the fact that such Lender or other
Credit Agreement 80
Person for the account of which such Lender receives any sums payable under any
of the Loan Documents is not subject to withholding or is subject to withholding
at a reduced rate.
(iv) Administrative Agent may, without reduction, withhold any Taxes
required to be deducted and withheld from any payment under any of the Loan
Documents with respect to which Borrowers is not required to pay additional
amounts under this Section 10.15(a).
(b) Upon the request of Administrative Agent, each Lender that is a
"United States person" within the meaning of Section 7701(a)(30) of the Code
shall deliver to Administrative Agent two duly signed completed copies of IRS
Form W-9. If such Lender fails to deliver such forms, then Administrative Agent
may withhold from any interest payment to such Lender an amount equivalent to
the applicable back-up withholding tax imposed by the Code, without reduction.
(c) If any Governmental Authority asserts that Administrative Agent did
not properly withhold or backup withhold, as the case may be, any tax, or other
amount from payments made to or for the account of any Lender, such Lender shall
indemnify Administrative Agent therefor, including all penalties and interest,
any taxes imposed by any jurisdiction on the amounts payable to Administrative
Agent under this Section, and costs and expenses (including Attorney Costs) of
Administrative Agent. The obligation of Lenders under this Section shall survive
the termination of the Aggregate Commitments, repayment of all other Obligations
hereunder and the resignation of Administrative Agent.
Replacement of Lenders. Under any circumstances set forth herein providing
that Borrowers shall have the right to replace a Lender as a party to this
Agreement, Borrowers may, upon notice to such Lender and Administrative Agent,
replace such Lender by causing such Lender to assign its Commitment (with the
assignment fee to be paid by Borrowers in such instance) pursuant to Section
10.07(b) to one or more other Lenders or Eligible Assignees procured by
Borrowers; provided, however, that if Borrowers elect to exercise such right
with respect to any Lender pursuant to Section 3.06(b), they shall be obligated
to replace all Lenders that have made similar requests for compensation pursuant
to Section 3.01 or 3.04. Borrowers shall (x) pay in full all principal,
interest, fees, and other amounts owing to such Lender through the date of
replacement (including any amounts payable pursuant to Section 3.05), and (y)
release such Lender from its obligations under the Loan Documents. Any Lender
being replaced shall execute and deliver an Assignment and Assumption with
respect to such Lender's Commitment and outstanding Loans.
Appraisal. Administrative Agent may obtain from time to time, an appraisal
of all or any part of any Collateral Property prepared in accordance with
written instructions from Administrative Agent by a third-party appraiser
engaged directly by Administrative Agent. Each such appraiser and appraisal
shall be satisfactory to Administrative Agent (including satisfaction of
applicable regulatory requirements). The cost of any such appraisal shall be
borne by Borrowers if such appraisal is the first appraisal in any calendar year
and in all events if Administrative Agent obtains such appraisal after the
occurrence of a Default, and such cost is due and payable by Borrowers on demand
and shall be secured by the Loan Documents.
Assignment of Contracts and Plans. As additional security for the
Obligations, Borrowers hereby transfer and assign to Administrative Agent for
the ratable benefit of Administrative Agent and Lenders all of Borrowers' right,
title, and interest, but not its liability, in, under, and to all construction,
architectural and design contracts, and the Plans, and agrees that all of the
same are covered by the security agreement provisions of the Mortgages.
Borrowers agree to deliver to Administrative Agent from time to time upon
Administrative Agent's request such consents to the foregoing assignment from
parties contracting with either Borrower as Administrative Agent may require.
Neither this assignment
Credit Agreement 81
nor any action by Administrative Agent or Lenders shall constitute an assumption
by Administrative Agent or Lenders of any obligation under any contract or with
respect to the Plans.
Governing Law.
(a) THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE
WITH, the LAW OF THE STATE OF NEW YORK applicable to agreements made and to be
performed entirely within such State; PROVIDED THAT Administrative Agent AND
EACH LENDER SHALL RETAIN ALL RIGHTS ARISING UNDER FEDERAL LAW.
(b) ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR ANY
OTHER LOAN DOCUMENT MAY BE BROUGHT IN XXX XXXXXX XX XXX XXXXX XX XXX XXXX
SITTING IN NEW YORK CITY, NEW YORK OR OF THE UNITED STATES FOR THE SOUTHERN
DISTRICT OF SUCH STATE, AND BY EXECUTION AND DELIVERY OF THIS AGREEMENT,
BORROWERS, Administrative Agent AND EACH LENDER CONSENTS, FOR ITSELF AND IN
RESPECT OF ITS PROPERTY, TO THE NON-EXCLUSIVE JURISDICTION OF THOSE COURTS. EACH
BORROWER, Administrative Agent, AND EACH LENDER IRREVOCABLY WAIVES ANY
OBJECTION, INCLUDING ANY OBJECTION TO THE LAYING OF VENUE OR BASED ON THE
GROUNDS OF FORUM NON CONVENIENS, WHICH IT MAY NOW OR HEREAFTER HAVE TO THE
BRINGING OF ANY ACTION OR PROCEEDING IN SUCH JURISDICTION IN RESPECT OF ANY LOAN
DOCUMENT OR OTHER DOCUMENT RELATED THERETO. EACH BORROWER, Administrative Agent,
AND EACH LENDER WAIVES PERSONAL SERVICE OF ANY SUMMONS, COMPLAINT OR OTHER
PROCESS, WHICH MAY BE MADE BY ANY OTHER MEANS PERMITTED BY THE LAW OF SUCH
STATE.
Waiver of Right to Trial by Jury. EACH PARTY TO THIS AGREEMENT HEREBY
EXPRESSLY WAIVES ANY RIGHT TO TRIAL BY JURY OF ANY CLAIM, DEMAND, ACTION OR
CAUSE OF ACTION ARISING UNDER ANY LOAN DOCUMENT OR IN ANY WAY CONNECTED WITH OR
RELATED OR INCIDENTAL TO THE DEALINGS OF THE PARTIES HERETO OR ANY OF THEM WITH
RESPECT TO ANY LOAN DOCUMENT, OR THE TRANSACTIONS RELATED THERETO, IN EACH CASE
WHETHER NOW EXISTING OR HEREAFTER ARISING, AND WHETHER FOUNDED IN CONTRACT OR
TORT OR OTHERWISE; AND EACH PARTY HEREBY AGREES AND CONSENTS THAT ANY SUCH
CLAIM, DEMAND, ACTION OR CAUSE OF ACTION SHALL BE DECIDED BY COURT TRIAL WITHOUT
A JURY, AND THAT ANY PARTY TO THIS AGREEMENT MAY FILE AN ORIGINAL COUNTERPART OR
A COPY OF THIS SECTION WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF THE
SIGNATORIES HERETO TO THE WAIVER OF THEIR RIGHT TO TRIAL BY JURY.
Time of the Essence. Time is of the essence of the Loan Documents.
Entire Agreement. This Agreement and the other Loan Documents represent the
final agreement AMONG the parties and may not be contradicted by evidence of
prior, contemporaneous, or subsequent oral agreements of the parties. There are
no unwritten oral agreements AMONG the parties.
[Signature pages follow.]
Credit Agreement 82
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the date first above written.
RFS PARTNERSHIP, L.P., a Tennessee limited
partnership, as Borrower
By: CNL ROSE GP CORP., a Delaware corporation,
its General Partner
By: /s/ C. XXXXX XXXXXXXXXX
-------------------------------
Name: C. XXXXX XXXXXXXXXX
--------------------------
Title: EVP/CFO
-------------------------
RFS FINANCING PARTNERSHIP, L.P., a
Tennessee limited partnership, as Borrower
By: RFS FINANCING 2002, LLC, a Delaware
limited liability company
its General Partner
By: /s/ C. XXXXX XXXXXXXXXX
-------------------------------
Name: C. XXXXX XXXXXXXXXX
--------------------------
Title: EVP/CFO
-------------------------
CNL HOSPITALITY PROPERTIES, INC., a
Maryland corporation, as Parent
By: /s/ C. XXXXX XXXXXXXXXX
------------------------------------
Name: C. XXXXX XXXXXXXXXX
------------------------------
Title: EVP/CFO
-----------------------------
Credit Agreement 84
BANK OF AMERICA, N.A., as Administrative Agent
By: /s/ XXXXX XXXXXXXX
-----------------------------------------
Name: XXXXX XXXXXXXX
-----------------------------------
Title: PRINCIPAL
----------------------------------
Credit Agreement 85
BANC OF AMERICA BRIDGE LLC, as a Lender
By: /s/ XXXXXX X. XXXXXXXXXXXX
---------------------------------------
Xxx Xxxxxxxxxxxx
Managing Director
Credit Agreement 86
