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EXHIBIT (b)(2)
FIRST AMENDMENT TO CREDIT AGREEMENT
THIS FIRST AMENDMENT TO CREDIT AGREEMENT (this "AMENDMENT") is dated as
of April 12, 1999, among AMERICAN INDUSTRIAL PROPERTIES REIT, a Texas real
estate investment trust ("BORROWER"), each of the Lenders (as defined in the
Credit Agreement), BANK ONE TEXAS, N.A., a national banking association, as
Agent (in such capacity, together with its successors and permitted assigns,
"AGENT"), and certain Lenders, as Issuing Banks (individually, in such capacity,
together with its successors and permitted assigns, "ISSUING BANK" and
collectively, the "ISSUING BANKS").
RECITALS:
A. Borrower, Lenders, Agent, and Issuing Banks executed that certain
Credit Agreement dated as of January 28, 1999 (the "CREDIT AGREEMENT").
B. Borrower, Lenders, Agent, and Issuing Banks have agreed to amend the
Credit Agreement as provided herein.
C. Except as otherwise expressly provided for herein, capitalized terms
used herein shall have the same meaning as set forth in the Credit Agreement.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:
1. SECTION 8.5(g) is hereby deleted in its entirety and replaced
with the following:
(g) Properties under construction or development for which the total
cost of such Properties (including the anticipated or budgeted costs to complete
such construction or development) exceeds ten percent (10%) of Total
Consolidated Value.
2. SECTION 4.2(b)(vii) is hereby deleted in its entirety and
replaced with the following:
(vii) the admission of such Property will not cause the NRA or
the Adjusted NOI of the Borrowing Base Properties in any one
metropolitan area (as defined by the United States Office of Management
and Budget) (an "MA") (except the MA in which Cleveland, Ohio is
located (the "CLEVELAND MA")) to exceed twenty-five percent (25%) of
the NRA or Adjusted NOI with respect to all Borrowing Base Properties
in all MA's; further, the admission of such Property will not cause the
NRA or the Adjusted NOI of the Borrowing Base Properties in the
Cleveland MA to exceed forty percent (40%) of the NRA or Adjusted NOI
with respect to all Borrowing Base Properties in all MA's; provided
that no Property in the Cleveland MA that is not listed as an Initial
Property or a Second Property shall be eligible for inclusion as a
Borrowing Base Property unless, following such addition to the
Borrowing Base, the NRA or the Adjusted NOI of the Borrowing Base
Properties in the Cleveland MA does not exceed twenty-five (25%) of the
NRA or Adjusted NOI with respect to all Borrowing Base in all MA's;
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3. That certain Second Property located in Mentor, Lake County, Ohio
known as "Steris" (the "STERIS PROPERTY") shall be admitted as a Borrowing Base
Property as of the date hereof, provided however, that Borrower shall not
include the Individual Borrowing Base for the Steris Property in the calculation
of the Borrowing Base until the following conditions have been satisfied:
a. Borrower shall have complied with SECTION 4.5 with regard
to the tenant(s) that occupy the Steris Property;
b. Borrower shall have delivered to Agent, for the ratable
benefit of Lenders, an original of the Subordination, Attornment and
Non-Disturbance Agreement in substantially the form of EXHIBIT J attached to the
Credit Agreement and executed by each tenant of the Steris Property; and
c. The Steris Property shall meet the requirements of SECTION
4.2(b)(viii)-(x).
4. The language "1.25" in SECTION 9.2 is hereby amended and replaced
with the language "1.35."
5. The language "1.5" in SECTION 9.3 is hereby amended and replaced
with the language "1.65."
6. EXHIBIT B of the Credit Agreement is hereby deleted in its entirety
and replaced with EXHIBIT B attached to this Amendment.
7. Borrower and Agent hereby approve Wells Fargo N.A. as an Eligible
Assignee.
8. Solely for purposes of determining stamp taxes and intangibles tax
due to the State of Florida upon filing of the Mortgage secured by that certain
property located in Volusia County, Florida known as "Volusia Building One" (the
"VOLUSIA PROPERTY"), Borrower and Agent agree that the collateral value of the
Volusia Property shall be $4,410,000; provided, however, that Agent may, at any
time and in its sole discretion, increase the collateral value of the Volusia
Property to $7,350,000 in which event Borrower shall immediately, upon Agent's
request, (a) execute all necessary documentation to increase the collateral
valuation, including without limitation, an amendment of the existing Mortgage
secured by the Volusia Property, (b) pay all taxes, mortgage fees, and other
related fees and costs of such increased collateral valuation, and (c) cause the
applicable title company to increase the amount of the Mortgagee Policy of Title
Insurance covering the Volusia Property to the collateral value of $7,350,000.
9. Any and all of the terms and provisions of the Loan Documents are
hereby amended and modified wherever necessary, and even though not specifically
addressed herein, so as to conform to the amendments and modifications set forth
herein. Each reference to the Credit Agreement and any other Loan Documents
shall henceforth refer to the Credit Agreement, as modified herein, and as it
may from time to time be subsequently amended, restated or supplemented.
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10. The parties hereto acknowledge and confirm that this Amendment
shall in no manner affect or impair any of the rights, benefits, security
interests, liens, or assignments securing or governing the Obligation, and such
rights, liens, benefits, security interests and assignments shall not in any
manner be waived, the purpose of this Amendment being to amend certain
provisions of the Credit Agreement as described herein, and to carry forward all
rights, benefits, security interests, liens and assignments which are
acknowledged by the parties hereto to be valid and subsisting rights, liens,
benefits, security interests and assignments.
11. Each Subsidiary Guarantor hereby consents to the terms of this
Amendment and acknowledges and confirms that the Subsidiary Guaranty executed by
it is in full force and effect as originally written, except as expressly
modified herein, and that the indebtedness and obligations evidenced by the
Notes and the Loan Documents, as modified herein, are and shall continue to
constitute a portion of the "Guaranteed Debt," as such term is defined in such
Subsidiary Guaranty. Each Subsidiary Guarantor further covenants and warrants to
Agent that (i) there are no defenses, counterclaims, or offsets to the
Subsidiary Guaranty executed by it, as modified herein, or its obligations
thereunder, and (ii) such Subsidiary Guaranty, as modified and confirmed herein,
is in full force and effect. The foregoing confirmation is given as an
accommodation to Agent and not as a right of any Subsidiary Guarantor.
12. DDR Office Flex II, LLC, a Subsidiary Guarantor, hereby confirms
that it has or will change its name to "AIP Office Flex II, LLC," and that,
notwithstanding such name change, DDR Office Flex II, LLC confirms and
acknowledges Section 6 above.
13. Borrower and Subsidiary Guarantors hereby represent, warrant, and
certify to the Credit Parties that, as of the date of, and after giving effect
to, this Amendment:
a. There exists no Potential Default, Default, or Material
Adverse Event.
b. Each Company has performed and complied with all agreements
and conditions contained in the Credit Agreement that are required to be
performed or complied with by such Company.
c. The representations and warranties contained in the Credit
Agreement and each of the other Loan Documents are true and correct in all
respects, with the same force and effect as though made on and as of the date of
this Amendment.
14. This Amendment shall be governed by the laws of the State of Texas
or the laws of the United States as applicable.
15. The execution and delivery by each party to this Amendment and the
performance by it of its obligations hereunder, (a) are within its trust,
corporate, limited liability company, or partnership power, (b) have been duly
authorized by all necessary trust, corporate, limited liability company, or
partnership action of such Person, (c) require no action by or filing with any
Governmental Authority, (d) do not violate any provision of its Constituent
Documents, (e) do not violate any provision of any Governmental Requirement or
order of any Governmental Authority applicable to it, (f) do not violate any
material agreements to which it is a party, or (g)
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do not result in the creation or imposition of any Lien on any asset of any
Company, other than pursuant to the Loan Documents.
16. This Amendment shall be binding upon and inure to the benefit of
the parties hereto and their respective successors, assigns and legal
representatives.
17. THIS WRITTEN LOAN AGREEMENT REPRESENTS THE FINAL AGREEMENT BETWEEN
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 BETWEEN THE PARTIES.
18. This Amendment may be executed in a number of identical
counterparts, and a telecopy or facsimile transmission shall be binding on the
party or parties whose signatures appear thereon. If so executed, each of such
counterparts is to be deemed an original for all purposes, and all such
counterparts shall, collectively, constitute one amendment, but in making proof
of this Amendment, it shall not be necessary to produce or account for more than
one such counterpart.
[Remainder of Page Intentionally Left Blank;
Signature Page Follows.]
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SIGNATURE PAGE TO FIRST AMENDMENT TO
CREDIT AGREEMENT BETWEEN
AMERICAN INDUSTRIAL PROPERTIES REIT,
BANK ONE, TEXAS, N.A., AS AGENT,
AND THE LENDERS DEFINED THEREIN
EXECUTED as of the day and year first mentioned.
BORROWER:
AMERICAN INDUSTRIAL PROPERTIES REIT,
a Texas real estate investment trust,
as Borrower
By: /s/ MARC A. SIMPSON
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Name: Marc A. Simpson
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Title: Sr. V.P.
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SUBSIDIARY GUARANTORS:
DDR OFFICE FLEX II, LLC,
an Ohio limited liability company
By: American Industrial Properties REIT,
a Texas real estate investment
trust, its Manager
By: /s/ MARC A. SIMPSON
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Name: Marc A. Simpson
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Title: Sr. V.P.
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SIGNATURE PAGE TO FIRST AMENDMENT TO
CREDIT AGREEMENT BETWEEN
AMERICAN INDUSTRIAL PROPERTIES REIT,
BANK ONE, TEXAS, N.A., AS AGENT,
AND THE LENDERS DEFINED THEREIN
AGENT:
BANK ONE, TEXAS, N.A.,
a national banking association
By: /s/ JEFF ETTER
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Name: Jeff Etter
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Title: Vice President
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LENDERS:
BANK ONE, TEXAS, N.A.,
a national banking association
By: /s/ JEFF ETTER
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Name: Jeff Etter
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Title: Vice President
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