AMENDMENT TO REVOLVING CREDIT AGREEMENT
AMENDMENT TO REVOLVING CREDIT AGREEMENT, dated as of February 29, 2000
(this "Amendment"), between MERISTAR H & R OPERATING COMPANY, L.P. ("Borrower")
and MERISTAR HOSPITALITY OPERATING PARTNERSHIP, L.P. ("Lender").
RECITALS
A. Lender and Borrower are parties to that certain Revolving Credit
Agreement, dated as of August 3, 1998 (the "Credit Agreement").
B. Borrower is entering into that certain Senior Secured Credit Agreement
(the "Senior Loan Agreement"), of even date herewith, with Societe General,
Southwest Agency, as arranger and administrative agent, Citibank/Salomon Smith
Barney, syndication agent, Lehman Bothers, Inc. as documentation Agent, and the
other lenders named therein (collectively, the "Senior Lenders").
C. Lender is entering into that certain Intercreditor Agreement (the
"Intercreditor Agreement"), of even date herewith, with the Senior Lenders.
D. Borrower and Lender desire to amend the Credit Agreement in certain
respects.
NOW, THEREFORE, Borrower and Lender agree as follows:
1. Section 1.01 of the Credit Agreement is hereby amended by amending the
definitions of "Applicable Margin," "Commitment," "Financial Institution Senior
Indebtedness," "Maturity Date," and "Senior Indebtedness" to read in their
entirety as follows:
"Applicable Margin" means 6.50%.
"Commitment" means $50,000,000.
"Financial Institution Senior Indebtedness" means the Indebtedness
evidenced by the Senior Loan Agreement and any modification, extension,
refinancing, or replacement thereof, provided that the maximum principle amount
thereof shall not exceed $100,000,000.
"Maturity Date" shall mean the date 91 days after the maturity date of the
Financial Institution Senior Indebtedness, as the same may be extended from time
to time.
"Senior Indebtedness" shall mean the Financial Institution Senior
Indebtedness.
2. Section 2.01 of the Credit Agreement is hereby amended by adding the
words "but no more often than once in any calendar month" after the word
"Borrower" in the second line thereof.
3. Section 2.06(b) of the Credit Agreement is hereby amended by (a)
changing the amount of "$500,000" to "1,000,000" in the last line thereof and
adding at the end of such section: "Notwithstanding the foregoing, Borrower may
not make an optional prepayment more than once in any calendar month."
4. A new Section 2.09 is hereby added to the Credit Agreement to read as
follows:
"Section 2.09 Unused Commitment Fee. Borrower shall pay to Lender an
annual fee (payable in quarterly installments) for the unused portion (the
"Unused Portion") of the Commitment (based on the average daily amount
outstanding during each Fiscal Quarter) in an amount equal to (a) .5%, if
the Unused portion is less than 50% of the Commitment or (b) .375%, if the
Unused Portion is equal to or greater than 50% of the Commitment.
5. Section 6.05 of the Credit Agreement is hereby amended by changing the
amount of "$50,000,000" to "$25,000,000."
6. Article VII of the Credit Agreement is hereby amended in its entirety
to read as follows:
"FINANCIAL COVENANTS
So long as any Note or any amount under any Credit Document shall remain
unpaid, or the Lender shall have any Commitment hereunder, unless the Lender
shall otherwise consent in writing, the Borrower agrees to cause the Parent to
comply with the following covenants:
Section 7.01 Senior Interest Coverage Ratio. The Parent shall maintain
at the end of each Rolling Period (a) for the Rolling Periods ending on
September 30, 1998 through September 30, 1999 a Senior Interest Coverage Ratio
of not less than 2.5 to 1.0, (b) for the Rolling Period ending December 31, 1999
through December 31, 2001 a Senior Interest Coverage Ratio of not less than 2.75
to 1.0 and (c) for each Rolling Period thereafter a Senior Interest Coverage
Ratio of not less than 3.25 to 1.
Section 7.02 Total Interest Coverage Ratio. The Parent shall maintain at
the end of each Rolling Period (a) for the Rolling Periods ending on September
30, 1998 through December 31, 2001, a Total Interest Coverage Ratio of not less
than 2.0 to 1.0 and (b) for any Rolling Period thereafter, a Total Interest
Coverage Ratio of not less than 2.5 to 1.0.
Section 7.03 Senior Fixed Charge Ratio. The Parent shall maintain at the
end of each Rolling Period (a) for the Rolling Periods ending on September 30,
1998 through September 30, 1999 a Senior Fixed Charge Ratio of not less than 2.0
to 1.0, (b) for the Rolling Periods ending on December 31, 1999 through December
31, 2001, a Senior Fixed Charge Ratio of not less than 2.5 to 1.0, and (c) for
any Rolling Period thereafter, a Senior Fixed Charge Ratio of not less than 1.5
to 1.0
Section 7.04 Total Fixed Charge Ratio. The Parent shall maintain at the
end of each Rolling Period (a) for the Rolling Periods ending on September 30,
1998 to September 30, 1999, a Total Fixed Charge Ratio of not less than 1.75 to
1.0, (b) for the Rolling Periods ending on December 31, 1999 to December 31,
2001, a Total Fixed Charge Ratio of not less than 2.0 to 1.0, and (c) for any
Rolling Period thereafter, a Total Fixed Charge Ratio of not less than 1.5 to
1.0.
Section 7.05 Senior Indebtedness Leverage Ratio. The Parent shall not on
any date permit the Senior Indebtedness Leverage Ratio to exceed (a) for the
Rolling Periods ending on September 30, 1998 through September 30, 1999, 4.0 to
1.0, (b) at any time thereafter through December 31, 2001, 3.00 to one and (c)
at any time thereafter, 1.50 to 1.0.
Section 7.06 Leverage Ratio. The Parent shall not on any date permit the
Leverage Ratio to exceed (a) prior to December 31, 1998 5.5 to 1, (b) from
December 31, 1998 to June 30, 1999, 5.0 to 1.0, (c) from July 1, 1999 to
September 30, 1999, 4.5 to 1.0, (d) from December 31, 1999 through December 31,
2001, 4.0 to 1 and (e) thereafter, 3.5 to 1."
7. Section 8.01 of the Credit Agreement is hereby amended in its entirety
to read as follows:
"Agreement to Subordinate. The Lender agrees that Indebtedness for
Borrowings under this Agreement represented by the Notes shall be
subordinated in right of payment, to the extent and in the manner provided
in the Intercreditor Agreement, to the prior payment in full of all
Financial Institution Senior Indebtedness. The Lender further agrees that
in connection with any replacement or refinancing of he Financial
Institution Senior Indebtedness which is permitted by this Agreement, it
shall enter into a new intercreditor or subordination agreement on terms
substantially similar to the Intercreditor Agreement."
8. Sections 8.02 through 8.06, inclusive, are hereby deleted from the
Credit Agreement.
9. Section 9.01(j) of the Credit Agreement is hereby amended by deleting
clause "(c)" thereof.
10. Section 10.02 of the Credit Agreement is hereby amended by changing
"James C. Calder" to "Alex Lombardo."
11. As amended hereby, the Credit Agreement and each "Credit Document" (as
defined in the Credit Agreement) is ratified and shall remain in full force and
effect.
IN WITNESS WHEREOF, the parties have executed this Amendment as of the date
first written above.
MERISTAR H & R OPERATING COMPANY, L.P.
By: MeriStar Hotels & Resorts, Inc.,
its general partner
By:
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Name:
Title:
MERISTAR HOSPITALITY OPERATING PARTNERSHIP, L.P.
By: MeriStar Hospitality Corporation,
its general partner
By:
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Name:
Title: