EXECUTION COPY
SECOND AMENDMENT TO CREDIT AGREEMENT
This SECOND AMENDMENT TO CREDIT AGREEMENT (this "Amendment) dated as of
April 23, 2003, by and among PREIT ASSOCIATES, L.P. (the "Borrower"),
PENNSYLVANIA REAL ESTATE INVESTMENT TRUST (the "Parent"), each of the Guarantors
party hereto, each of the Lenders party hereto, and WELLS FARGO BANK, NATIONAL
ASSOCIATION, as Agent (the "Agent").
WHEREAS, the Borrower, the Parent, the Lenders and the Agent have
entered into that certain Credit Agreement dated as of December 28, 2000 (as
amended and in effect immediately prior to the date hereof, the "Credit
Agreement"); and
WHEREAS, the Borrower, the Parent, the Lenders party hereto and the
Agent desire to amend certain provisions of the Credit Agreement on the terms
and conditions contained herein.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged by the parties hereto, the parties
hereto hereby agree as follows:
Section 1. Specific Amendments to Credit Agreement. The parties hereto
agree that the Credit Agreement is amended as follows:
(a) The Credit Agreement is amended by adding to Annex I to the Credit
Agreement the following definitions in their appropriate alphabetical location:
"Multi-Family Disposition" means the disposition by the
Borrower of multi-family Properties contemplated by that certain
Purchase and Sale Agreement dated as of March 3, 2003 by and between
the Borrower and MPM Acquisition Corp.
"Rouse Acquisition" means the acquisition by the Parent,
indirectly through Subsidiaries, from affiliates of The Rouse Company,
of the Rouse Properties pursuant to the applicable Agreements of
Purchase and Sale dated as of March 7, 2003 by and among certain
Subsidiaries of the Parent, as buyers, and certain affiliates of The
Rouse Company, as sellers.
"Rouse Properties" means each of the retail Properties
commonly known as Cherry Hill Mall in Camden County, New Jersey,
Moorestown Mall in Burlington County, New Jersey, Plymouth Meeting Mall
in Montgomery County, Pennsylvania, The Gallery I in Philadelphia,
Pennsylvania, Exton Mall (including the Kmart property) in Chester
County, Pennsylvania and Echelon Mall in Camden County, New Jersey.
(b) The Credit Agreement is amended by deleting the table appearing in
the definition of the term "Applicable Margin" set forth in Annex I to the
Credit Agreement and substituting in its place the following:
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Ratio of Total Liabilities to
Level Gross Asset Value Applicable Margin
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1 Less than or equal to 0.40 to 1.00 1.30%
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2 Greater than 0.40 to 1.00 but less than 1.50%
or equal to 0.50 to 1.00
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3 Greater than 0.50 to 1.00 but less than 1.65%
or equal to 0.60 to 1.00
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4 Greater than 0.60 to 1.00 but less than 1.80%
or equal to 0.65 to 1.00
- --------------------------------------------------------------------------------
5 Greater than 0.65 to 1.00 1.90%
- --------------------------------------------------------------------------------
(c) The Credit Agreement is amended by adding to the end of definition
of the term "Applicable Margin" set forth in Annex I to the Credit Agreement the
following sentence:
In addition to the foregoing, the Applicable Margin for Revolving Loans
and Term Loans shall be determined by the Agent based on the ratio of
Total Liabilities to Gross Asset Value immediately after the following
(and after giving effect thereto including the incurrence or repayment
of any Indebtedness in connection therewith): (x) the acquisition of
each Rouse Property and (y) the disposition of each Property in the
Multi-Family Disposition, in each case as such ratio is set forth in a
Pricing Certificate which the Borrower shall deliver to the Agent
within 1 Business Day of the occurrence of any such event.
(d) The Credit Agreement is amended by adding the following to the end
of the definition of the term "Total Liabilities" set forth in Annex I to the
Credit Agreement:
For purposes of determining the Total Liabilities of the Parent and the
Subsidiaries, the amount of any Indebtedness assumed by the Parent or
any Subsidiary at the time of an acquisition which the Parent is
required under GAAP to reflect at fair value on a balance sheet, shall
be equal to outstanding principal balance of such Indebtedness and not
the fair value of such Indebtedness as would be reflected on the
Parent's balance sheet.
(e) The Credit Agreement is amended by deleting subsections (b) and (i)
of Section 10.1. in their entirety and substituting in their respective places
the following:
(b) Ratio of Total Liabilities to Gross Asset Value. The
Parent shall not permit the ratio of (i) Total Liabilities of the
Parent and its Subsidiaries determined on a consolidated basis to (ii)
Gross Asset Value of the Parent and its Subsidiaries determined on a
consolidated basis, to exceed 0.70 to 1 at any time.
(i) Floating Rate Indebtedness. The Parent and the Borrower
will not, and will not permit any of their respective Subsidiaries to,
incur, assume or suffer to exist at any time Floating Rate Indebtedness
in an aggregate outstanding principal amount in excess of $400,000,000.
Section 2. Conditions Precedent. The effectiveness of this Amendment is
subject to receipt by the Agent of each of the following, each in form and
substance satisfactory to the Agent:
(a) A counterpart of this Amendment duly executed by the Borrower, each
of the Guarantors and each of the Lenders;
(b) Evidence that the modification fee referenced in Section 7 of this
Amendment has been paid;
(c) Evidence that all fees, costs and expenses of the Agent, including
without limitation the fees of Agent's counsel, incurred in connection with the
negotiation, documentation and closing of this Amendment and related documents
and agreements have been paid; and
(d) Such other documents, instruments and agreements as the Agent may
reasonably request.
Section 3. Representations. The Parent and the Borrower each represents
and warrants to the Agent and the Lenders that:
(a) Authorization. The Parent and the Borrower each has the right and
power, and has taken all necessary action to authorize it, to execute and
deliver this Amendment and to perform its obligations hereunder and under the
Credit Agreement, as amended by this Amendment, in accordance with their
respective terms. This Amendment has been duly executed and delivered by the
duly authorized officers of the Parent (on behalf of itself and as general
partner of the Borrower) and each of this Amendment, and the Credit Agreement as
amended by this Amendment, is a legal, valid and binding obligation of each of
the Parent and the Borrower enforceable against each such Person in accordance
with its respective terms, except as the same may be limited by bankruptcy,
insolvency, fraudulent conveyance and other similar laws affecting the rights of
creditors generally and the availability of equitable remedies for the
enforcement of certain obligations (other than the payment of principal)
contained herein or therein may be limited by equitable principles generally.
(b) Compliance with Laws, etc. The execution and delivery of this
Amendment, and the performance of this Amendment, and the Credit Agreement as
amended by this Amendment, in accordance with their respective terms, do not and
will not, by the passage of time, the giving of notice, or both: (i) require any
Governmental Approval or violate any Applicable Law (including all Environmental
Laws) relating to any Loan Party or any other Subsidiary; (ii) result in a
breach of or constitute a default under the declaration of trust, certificate or
articles of incorporation, bylaws, partnership agreement or other organizational
documents of any Loan Party or any other Subsidiary, or any indenture, agreement
or other instrument to which any Loan Party or any other Subsidiary is a party
or by which it or any of its respective properties may be bound; or (iii) result
in or require the creation or imposition of any Lien upon or with respect to any
property now owned or hereafter acquired by any Loan Party or any other
Subsidiary other than in favor of the Agent for the benefit of the Lenders.
(c) No Default. No Default or Event of Default has occurred and is
continuing as of the date hereof nor will exist immediately after giving effect
to this Amendment.
Section 4. Reaffirmation of Representations. The Parent and the
Borrower each hereby repeats and reaffirms all representations and warranties
made by such Person to the Agent and the Lenders in the Credit Agreement and the
other Loan Documents to which it is a party on and as of the date hereof except
to the extent that such representations and warranties expressly relate solely
to an earlier date (in which case such representations and warranties were true
and accurate on and as of such earlier date) and except for changes in factual
circumstances not prohibited under the Loan Documents.
Section 5. Reaffirmation of Guaranty by Guarantors. Each Guarantor
hereby reaffirms its continuing obligations to the Agent and the Lenders under
the Guaranty and agrees that the transactions contemplated by this Amendment
shall not in any way affect the validity and enforceability of the Guaranty or
reduce, impair or discharge the obligations of such Guarantor thereunder.
Section 6. Certain References. Each reference to the Credit Agreement
in any of the Loan Documents shall be deemed to be a reference to the Credit
Agreement as amended by this Amendment.
Section 7. Modification Fee. In consideration of the Lenders amending
of the Credit Agreement as provided herein, the Borrower agrees to pay to the
Agent for the account of each Lender a modification fee in an amount equal to
0.15% of such Lender's Revolving Commitment.
Section 8. Expenses. The Borrower shall reimburse the Agent upon demand
for all reasonable costs and expenses (including reasonable attorneys' fees)
incurred by the Agent in connection with the preparation, negotiation and
execution of this Amendment and the other agreements and documents executed and
delivered in connection herewith.
Section 9. Benefits. This Amendment shall be binding upon and shall
inure to the benefit of the parties hereto and their respective successors and
assigns.
Section 10. GOVERNING LAW. THIS AMENDMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE COMMONWEALTH OF PENNSYLVANIA
APPLICABLE TO CONTRACTS EXECUTED, AND TO BE FULLY PERFORMED, IN SUCH
COMMONWEALTH.
Section 11. Effect. Except as expressly herein amended, the terms and
conditions of the Credit Agreement and the other Loan Documents remain in full
force and effect. The amendments contained herein shall be deemed to have
prospective application only, unless otherwise specifically stated herein.
Section 12. Counterparts. This Amendment may be executed in any number
of counterparts, each of which shall be deemed to be an original and shall be
binding upon all parties, their successors and assigns.
Section 13. Definitions. All capitalized terms not otherwise defined
herein are used herein with the respective definitions given them in the Credit
Agreement.
[Signatures on Next Page]
IN WITNESS WHEREOF, the parties hereto have caused this Second
Amendment to Credit Agreement to be executed as of the date first above written.
BORROWER
PREIT ASSOCIATES, L.P.
By: Pennsylvania Real Estate Investment Trust,
its general partner
By: /s/ Jonathan B. Weller
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Name: Jonathan B. Weller
Title: President & Chief Operating Officer
PARENT
PENNSYLVANIA REAL ESTATE INVESTMENT TRUST
By: /s/ Jonathan B. Weller
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Name: Jonathan B. Weller
Title: President & Chief Operating Officer
[Signatures Continued on Next Page]
[Signature Page to Second Amendment to Credit Agreement
with PREIT Associates, L.P.]
GUARANTORS
PR CHRISTIANA LLC
By: PREIT Associates, L.P., sole member
PR NORTH DARTMOUTH LLC
By: PREIT Associates, L.P., sole member
PR 8000 NATIONAL HIGHWAY, L.P.
By: PR 8000 National Highway LLC, sole general partner
By: PREIT Associates, L.P., sole member
ROOSEVELT II ASSOCIATES, L.P.
By: PR Northeast LLC, sole general partner
By: PREIT Associates, L.P., sole member
PR FESTIVAL LIMITED PARTNERSHIP
By: PR Festival LLC, sole general partner
By: PREIT Associates, L.P., sole member
PR 8000 AIRPORT HIGHWAY, L.P.
By: PR 8000 Airport Highway LLC, sole general partner
By: PREIT Associates, L.P., sole member
PR INTERSTATE CONTAINER LLC
By: PREIT Associates, L.P., sole member
PR NORTHEAST LIMITED PARTNERSHIP
By: PR Northeast LLC, sole general partner
By: PREIT Associates, L.P., sole member
PR WARRINGTON LIMITED PARTNERSHIP
By: PR Warrington LLC, sole general partner
By: PREIT Associates, L.P., sole member
PR FLORENCE LLC
By: PREIT Associates, L.P., sole member
By: Pennsylvania Real Estate Investment
Trust, sole general partner
By: /s/ Jonathan B. Weller
--------------------------------
Name: Jonathan B. Weller
Title: President & Chief Operating
Officer
[Signatures Continued on Next Page]
[Signature Page to Second Amendment to Credit Agreement
with PREIT Associates, L.P.]
PR TITUS LIMITED PARTNERSHIP
By: PR Titus LLC, sole member
By: PREIT Associates, L.P., sole member
PRGL PAXTON LIMITED PARTNERSHIP
By: PR Paxton LLC, sole general partner
By: PREIT Associates, L.P., sole member
By: Pennsylvania Real Estate Investment Trust, sole
general partner
By: /s/ Jonathan B. Weller
--------------------------------
Name: Jonathan B. Weller
Title: President & Chief Operating
Officer
PREIT-RUBIN, INC.
By: /s/ David Bryant
--------------------------------
Name: David Bryant
Title: Senior Vice President
JACKSONVILLE ASSOCIATES
By: PR South Blanding LLC, general partner
By: PREIT Associates, L.P., sole member
By: Pennsylvania Real Estate Investment Trust, sole
general partner
By: /s/ Jonathan B. Weller
--------------------------------
Name: Jonathan B. Weller
Title: President & Chief Operating
Officer
By: PREIT Associates, L.P., general partner
By: Pennsylvania Real Estate Investment Trust,
sole general partner
By: /s/ Jonathan B. Weller
--------------------------------
Name: Jonathan B. Weller
Title: President & Chief Operating
Officer
[Signatures Continued on Next Page]
[Signature Page to Second Amendment to Credit Agreement
with PREIT Associates, L.P.]
AGENT AND THE LENDERS
WELLS FARGO BANK, NATIONAL ASSOCIATION,
individually and as Agent
By: /s/ Charles Cooke
-------------------------------
Name: Charles Cooke
Title: Vice President
U.S. BANK NATIONAL ASSOCIATION
By: /s/ Renee Lewis
--------------------------------
Name: Renee Lewis
Title: Assistant Vice President
MANUFACTURERS & TRADERS TRUST COMPANY
By: /s/ Todd A. Detwiler
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Name: Todd A. Detwiler
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Title: Assistant Vice President
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FLEET NATIONAL BANK
By: /s/ Matthew A. Anzideo
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Name: Matthew A. Anzideo
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Title: Vice President
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FIRSTRUST BANK
By: /s/ Bruce A. Gillespie
-------------------------------
Name: Bruce A. Gillespie
---------------------------
Title: Vice President
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[Signatures Continued on Next Page]
[Signature Page to Second Amendment to Credit Agreement
with PREIT Associates, L.P.]
SOVEREIGN BANK
By: /s/ William J. Crowley
--------------------------------
Name: William J. Crowley
--------------------------
Title: Senior Vice President
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WILMINGTON TRUST COMPANY
By: /s/ Greg A. Hortin
--------------------------------
Name: Greg A. Hortin
--------------------------
Title: Vice President
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COMMERCEBANK, N.A.
By: /s/ Fred M. McConnell
--------------------------------
Name: Fred M. McConnell
--------------------------
Title: Senior Vice President
-------------------------