EXHIBIT 10.1
EXECUTION COPY
AMENDMENT TO CREDIT AGREEMENT
-----------------------------
AMENDMENT, dated as of September 18, 1998 (this "Amendment"), among
EXTENDED STAY AMERICA, INC., a Delaware corporation (the "Borrower"), the banks
party to the Credit Agreement described below (the "Banks"), MORGAN STANLEY
SENIOR FUNDING, INC., as Syndication Agent and Arranger, and THE INDUSTRIAL BANK
OF JAPAN, LIMITED, as Administrative Agent. All capitalized terms used herein
and not otherwise defined shall have the respective meanings provided such terms
in the Credit Agreement referred to below.
W I T N E S S E T H :
-------------------
WHEREAS, the Borrower, the Banks, Morgan Stanley Senior Funding, Inc., as
Syndication Agent and Arranger, and The Industrial Bank of Japan, as
Administrative Agent are parties to an Amended and Restated Credit Agreement,
dated as of March 10, 1998 (as amended, modified and supplemented through the
date hereof, the "Credit Agreement");
WHEREAS, the parties hereto wish to amend the Credit Agreement as herein
provided;
NOW THEREFORE, it is agreed:
1. Section 11 of the Credit Agreement is hereby amended by (a) adding the
proviso "provided that the September 1998 Charge shall not be deemed to
constitute corporate overhead for purposes of this definition" at the end of the
definition of "Annualized Corporate Overhead Amount", (b) deleting the "and"
before clause (iv) of the proviso to the definition of "Consolidated Net Income"
and inserting a comma in lieu thereof, (c) adding the phrase "and (v) the
September 1998 Charge shall not be taken into account in determining
Consolidated Net Income of the Borrower" at the end of the definition of
"Consolidated Net Income" and (d) adding the following definition in the
appropriate alphabetical order:
"September 1998 Charge" shall mean the non-recurring expense of up to
$13,250,000 resulting from the establishment in the fiscal quarter of the
Borrower ended September 1998 of a valuation allowance for costs which have been
incurred to acquire options for sites, the performance of related due diligence
and other related expenses.
2. This Amendment is limited precisely as written and shall not be deemed
to be a consent to or modification of any other term or condition of the Credit
Agreement, the other Credit Documents or any of the instruments or agreements
referred to therein.
3. In order to induce the Banks to enter into this Amendment, the Borrower
hereby represents and warrants that (x) no Default or Event of Default exists on
the Amendment Date (as defined below) after giving effect to this Amendment and
(y) all of the representations and warranties contained in the Credit Documents
shall be true and correct in all material respects on the Amendment Date after
giving effect to this Amendment with the same effect as though such
representations and warranties had been made on and as of the Amendment Date (it
being understood that any representation or warranty made as of a specific date
shall be true and correct in all material respects as of such specific date).
4. This Amendment shall become effective for all purposes on the first
date (the "Amendment Date"), on and after the date that the Borrower and the
Required Banks shall have signed a counterpart hereof (whether the same or
different counterparts) and shall have delivered (including by way of
telecopier) the same to Administrative Agent's counsel (attention: M. Irmak
Canevi, Fax: (212) 354-8113).
5. This Amendment may be executed in any number of counterparts and by the
different parties hereto on separate counterparts, each of which counterparts
when executed and delivered shall be an original, but all of which shall
together constitute one and the same instrument. A complete set of counterparts
shall be lodged with the Borrower and the Administrative Agent.
8. THIS AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER
SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAW OF THE STATE OF
NEW YORK.
9. From and after the Amendment Date, all references in the Credit
Agreement and each of the Credit Documents to the Credit Agreement or each of
the Credit Documents shall be deemed to be references to such Credit Agreement
or each of the Credit Documents as amended hereby.
* * *
2
IN WITNESS WHEREOF, each of the parties hereto has caused a counterpart of
this Amendment to be duly executed and delivered as of the date first above
written.
EXTENDED STAY AMERICA, INC.
By: /s/ Robert A. Brannon
---------------------------------------
Name: Robert A. Brannon
Title: Senior Vice President
MORGAN STANLEY SENIOR FUNDING,
INC., Individually, as Syndication Agent
and as Arranger
By: /s/ Michael T. McLaughlin
---------------------------------------
Name: Michael T. McLaughlin
Title: Principal
THE INDUSTRIAL BANK OF JAPAN,
LIMITED, Individually and as
Administrative Agent
By: /s/ Takuya Honjo
---------------------------------------
Name: Takuya Honjo
Title: Senior Vice President
3
BALANCED HIGH YIELD FUND I, LTD., c/o
BHF-BANK AKTIENGESELLSCHAFT
Acting through its New York Branch as
attorney-in-fact
By: /s/ John Sykes
-----------------------------------
Name: John Sykes
Title: Vice President
By: /s/ Tony Heyman
-----------------------------------
Name: Tony Heyman
Title: AVP
BANK OF TOKYO-MITSUBISHI TRUST
COMPANY
By: /s/ Brian S. Dossie
-----------------------------------
Name: Brian S. Dossie
Title: Assistant Vice President
BANK ONE, KENTUCKY, NA
By:
-----------------------------------
Name:
Title:
BANKBOSTON, NA
By: /s/ Renee A. Ross
-----------------------------------
Name: Renee A. Ross
Title: Managing Director
BANKERS TRUST COMPANY
By:
-----------------------------------
Name:
Title:
4
BEAR STEARNS INVESTMENT
PRODUCTS, INC.
By:
-----------------------------------
Name:
Title:
BLACK DIAMOND CAPITAL
MANAGEMENT LLC
c/o TORONTO DOMINION TX, INC.
By:
-----------------------------------
Name:
Title:
CANADIAN IMPERIAL BANK OF
COMMERCE
By: /s/ Karen Volk
-----------------------------------
Name: Karen Volk
Title: Authorized Signatory
CAPTIVA III FINANCE, LTD.
c/o PACIFIC INVESTMENT
MANAGEMENT CO.
By: PIMCO Management Inc.,
a general partner
By: /s/ Richard M. Weil
----------------------------------
Name: Richard M. Weil
Title: Senior Vice President
5
CHANG HWA COMMERCIAL BANK, LTD.,
NEW YORK BRANCH
By:
-----------------------------------
Name:
Title:
CHEVY CHASE BANK, FSB
By:
-----------------------------------
Name:
Title:
COMPAGNIE FINANCIERE DE CIC ET DE
L'UNION EUROPEENE
By: /s/ Marcus Edward
-----------------------------------
Name: Marcus Edward
Title: Vice President
By: /s/ Sean Mounier
-----------------------------------
Name: Sean Mounier
Title: First Vice President
DELANO COMPANY
By PACIFIC INVESTMENT
MANAGEMENT COMPANY, as its
Investment Advisor
By: PIMCO Management Inc.,
a general partner
By: /s/ Richard M. Weil
-----------------------------------
Name: Richard M. Weil
Title: Senior Vice President
6
ERSTE BANK DER OESTERREICHISCHEN
SPARKASSENAG
By: /s/ Paul Judicke
-----------------------------------
Name: Paul Judicke
Title: Vice President
By: /s/ John S. Runnio
-----------------------------------
Name: John S. Runnio
Title: First Vice President
FIRST COMMERCIAL BANK
By: /s/ June Shiong Lu
-----------------------------------
Name: June Shiong Lu
Title: SVP & General Manager
FLOATING RATE PORTFOLIO
c/o INVESCO SENIOR SECURED
MANAGEMENT
By: /s/ Kathleen A. Lenarcic
-----------------------------------
Name: Kathleen A. Lenarcic
Title: Authorized Signatory
HELLER FINANCIAL, INC.
By: /s/ Linda W. Wolf
-----------------------------------
Name: Linda W. Wolf
Title: Senior Vice President
IMPERIAL BANK
By: /s/ Steven K. Johnson
-----------------------------------
Name: Steven K. Johnson
Title: Senior Vice President
7
KZH III LLC
By: /s/ Virginia Conway
-------------------------------
Name: Virginia Conway
Title: Authorized Agent
KZH ING-2 LLC
By: /s/ Virginia Conway
-------------------------------
Name: Virginia Conway
Title: Authorized Agent
KZH-PAMCO LLC
By:
-------------------------------
Name:
Title:
LAND BANK OF TAIWAN
By:
-------------------------------
Name:
Title:
LEHMAN COMMERCIAL PAPER INC.
By:
-------------------------------
Name:
Title:
8
MANUFACTURERS AND TRADERS TRUST
COMPANY
By: /s/ R. Buford Sears
-------------------------------
Name: R. Buford Sears
Title: Administrative Vice President
MERRILL LYNCH, PIERCE, FENNER &
SMITH INCORPORATED
By: /s/ Benjamin W. Lau
-------------------------------
Name: Benjamin W. Lau
Title: Authorized Signatory
ML CLO XIX STERLING (CAYMAN) LTD.
c/o STERLING ASSET MANAGEMENT,
LLC
By:
-------------------------------
Name:
Title:
ML CLO XX PILGRIM AMERICA
(CAYMAN), LTD. c/o PILGRIM
AMERICA INVESTMENTS, INC.
By:
-------------------------------
Name:
Title:
9
MOUNTAIN CLO TRUST
By:
-------------------------------
Name:
Title:
ORIX USA CORPORATION
By: /s/ Mr. Charles Kobayashi
------------------------------
Name: Mr. Charles Kobayashi
Title: Vice President & Manager
PAM CAPITAL FUNDING, LP
c/o PROTECTIVE ASSET
MANAGEMENT COMPANY
By:
-------------------------------
Name:
Title:
SENIOR DEBT PORTFOLIO
c/o BOSTON MANAGEMENT
RESEARCH
By: /s/ Scott H. Page
------------------------------
Name: Scott H. Page
Title: Vice President
SUMMIT BANK
By:
-------------------------------
Name:
Title:
10
THE DEVELOPMENT BANK OF
SINGAPORE, LTD.
By:
-------------------------------
Name:
Title:
THE LONG TERM CREDIT BANK OF
JAPAN, LTD.
By: /s/ Thomas Meyer
-------------------------------
Name: Thomas Meyer
Title: Senior Vice President
THE SUMITOMO BANK, LIMITED
By:
-------------------------------
Name:
Title:
TORONTO DOMINION TX, INC.
By:
-------------------------------
Name:
Title:
11
RZB FINANCE LLC
By: /s/ John A. Valiska
-----------------------------
Name: John A. Valiska
Title: Vice President
By: /s/ Pearl Geffers
-----------------------------
Name: Pearl Geffers
Title: Vice President
12
ANNEX I
ACKNOWLEDGEMENT AND AGREEMENT
-----------------------------
Each of the undersigned, each being a Subsidiary Guarantor on the Amendment
Date (including each Subsidiary of the Borrower which was a Subsidiary Guarantor
immediately before the Amendment Date and each Subsidiary of the Borrower which
becomes a Subsidiary Guarantor on the Amendment Date) hereby acknowledges and
agrees to the provisions of the foregoing Amendment, and hereby agrees for the
benefit of the Banks that all references in the Credit Documents to the "Credit
Agreement" shall be deemed to be a reference to the Credit Agreement as amended
by this Amendment.
ESA 0100, INC.
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ESA TEXAS, INC.
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ESA VIRGINIA, INC.
ESA WASHINGTON, INC.
EXTENDED STAY 0453, INC.
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EXTENDED STAY 0507, INC.
EXTENDED STAY 0547, INC.
EXTENDED STAY 2506, INC.
EXTENDED STAY CA, INC.
ESA MANAGEMENT, INC.
ESA WEST, INC.
ESA INTERNATIONAL, INC.
STUDIO PLUS HOTELS, INC.
STUDIO PLUS PROPERTIES, INC.
By
------------------------------------
Name:
Title:
On behalf of each Subsidiary
Guarantor listed above
7