1
EXHIBIT 10.19.1
SECOND AMENDMENT
to
CREDIT AGREEMENT
THIS SECOND AMENDMENT TO CREDIT AGREEMENT ("Second Amendment"), dated
as of August 20, 1999 among FELCOR LODGING TRUST INCORPORATED, a Maryland
corporation (f/k/a FelCor Suite Hotels, Inc.) ("FelCor") and FELCOR LODGING
LIMITED PARTNERSHIP, a Delaware limited partnership (f/k/a FelCor Suites Limited
Partnership) ("FelCor LP" and collectively with FelCor, the "Borrower"), the
financial institutions listed on the signature pages hereof (each individually a
"Lender" and collectively the "Lenders"), and THE CHASE MANHATTAN BANK, as
administrative agent for the Lenders (in such capacity, the "Administrative
Agent").
WITNESSETH:
WHEREAS, that certain Fourth Amended and Restated Credit Agreement,
dated as of July 1, 1998, among Borrower, the financial institutions party
thereto, and the Administrative Agent provides for the making of certain loans
to Borrower up to an aggregate principal amount of $1,100,000,000 (the "Credit
Agreement");
WHEREAS, pursuant to that certain First Amendment to the Credit
Agreement and the Loan Agreement ("First Amendment"), dated as of May 17, 1999
among the parties hereto, the parties modified the defined term "Unencumbered"
in the Credit Agreement;
WHEREAS, the parties hereto desire to cancel the amendments made by the
First Amendment and to modify the Credit Agreement in certain respects;
NOW, THEREFORE, in consideration of Ten Dollars ($10.00) and other good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto hereby agree that the Credit Agreement is
amended as follows:
1. The First Amendment is hereby canceled and shall have no force or
effect. All amendments set forth in the First Amendment are hereby declared void
and the terms of the Credit Agreement are hereby restored to the terms in effect
immediately prior to the adoption of the First Amendment, but with such
amendments and modifications thereto as are set forth elsewhere herein.
2
2. Under Section 1.1 of the Credit Agreement, there is hereby added
thereto (in alphabetical order) a new defined term which shall read as follows:
"`Disqualified Stock' shall mean any class or series of Stock
of any Person that by its terms or otherwise is (i) required to be
redeemed prior to the Final Maturity Date of the Loans, (ii)
redeemable at the option of the holder of such class or series of
Stock at any time prior to the Final Maturity Date of the Loans, or
(iii) convertible into or exchangeable for Stock referred to in
clause (i) or (ii) above or Indebtedness having a scheduled maturity
prior to the Final Maturity Date of the Loans."
3. Under Section 1.1 of the Credit Agreement, there is hereby added
thereto (in alphabetical order) a new defined term which shall read as follows:
"`Indenture' means that certain Indenture dated as of October
1, 1997, as amended to date and as may be amended, modified, or
supplemented from time to time, among FelCor Suites Limited
Partnership (predecessor in interest to FelCor LP) as issuer,
various Borrower affiliates as guarantors, and SunTrust Bank,
Atlanta, as trustee providing for the initial issuance of up to
$175,000,000 aggregate principal amount of 7-3/8% senior notes due
2004 and $125,000,000 aggregate principal amount of 7-5/8% senior
notes due 2007."
4. Under the definition of "Permitted Liens" in Section 1.1 of the
Credit Agreement, the word "and" preceding clause (c) thereof is hereby deleted
and there is hereby added thereto a new clause (d) which shall read as follows:
"and (d) Liens secured by collateral similar in type to the
collateral securing the Pledge Agreement (but not the Collateral, as
defined in and pledged under the Pledge Agreement) and securing on
an equal and ratable basis the Loans and any other Indebtedness."
5. Under Section 1.1 of the Credit Agreement, there is hereby added
thereto (in alphabetical order) a new defined term which shall read as follows:
"'Pledge Agreement' means that certain Pledge and Security
Agreement entered into in connection with the $375,000,000 Loan
Agreement, dated as of April 1, 1999, between Borrower and Chase as
the Administrative Agent (the "Loan Agreement"), under which
ownership interests in certain entities of or affiliated with the
Borrower (as set forth in the Pledge Agreement) are pledged under
certain circumstances as collateral for, inter alia, the Loans, as
such Pledge Agreement may be amended, modified or supplemented from
time to time."
6. Under the definition of the term "Recourse Secured Indebtedness" in
Section 1.1 of the Credit Agreement, the following parenthetical phrase is
hereby added in clause (A)(x) after the word "Lien":
2
3
"(other than a Permitted Lien or in connection with the Pledge
Agreement)"
7. Under the definition of the term "Stock" in Section 1.1 of the
Credit Agreement, the period at the end of the sentence is hereby deleted and
the following is hereby substituted in place thereof:
"and limited liability company interests."
8. Under the definition of the term "Total Secured Indebtedness" in
Section 1.1 of the Credit Agreement, the following parenthetical phrase is
hereby added after the words "or other encumbrance":
"(other than a Permitted Lien or in connection with the Pledge
Agreement)"
9. Under the definition of the term "Unencumbered" in Section 1.1 of
the Credit Agreement, the last parenthetical phrase in paragraph (c) is hereby
deleted in its entirety and the following is hereby substituted in place
thereof:
"(other than pursuant to an "equal and ratable" clause contained in
any agreement governing Indebtedness)."
10. Under the definition of the term "Unencumbered" in Section 1.1 of
the Credit Agreement, the last paragraph thereof is hereby deleted in its
entirety and the following is hereby substituted in place thereof:
"For the purposes of this Agreement, any Joint Venture Hotel or
Hotel owned by the Borrower, or a Subsidiary of the Borrower shall
not be deemed to be Unencumbered unless both (i) such Hotel and
(ii) all Stock owned directly or indirectly by either FelCor or
FelCor LP in the entity that owns such Hotel is Unencumbered (other
than by a Permitted Lien or in connection with the Pledge
Agreement)."
11. Under Section 1.1 of the Credit Agreement, there is hereby added
thereto (in alphabetical order) a new defined term which shall read as follows:
"`Unsecured Indebtedness' of any Person means any Indebtedness
of such Person not required to be included in the computation of
Total Secured Indebtedness of such Person."
12. Under the definition of the term "Total Value" in Section 1.1 of
the Credit Agreement, paragraph (B) thereof is hereby deleted in its entirety
and the following is hereby substituted in place thereof:
"(B) for Hotels owned or leased pursuant to a Qualified Lease
by Borrower (or any Subsidiary or Unconsolidated Entity of
Borrower) (x) for less than four (4) fiscal Quarters and for which
the Borrower (or
3
4
any Subsidiary or Unconsolidated Entity of Borrower) does not have,
or is not able to reasonably obtain, trailing four quarter audited
financial information or (y) which the Borrower has designated as a
Refurbishment Hotel, in each such case 95% of the Borrower's
Investment in such Hotels (provided that if the Allerton Hotel is
designated as a Refurbishment Hotel, then such Hotel shall be
valued at 85% of the Borrower's Investment in such Hotel); plus"
13. Under the definition of the term "Unsecured Interest Expense" in
Section 1.1 of the Credit Agreement, the term "unsecured Indebtedness" as used
therein is hereby deleted wherever used and the term "Unsecured Indebtedness" is
hereby substituted in place thereof.
14. Under Section 6.11 of the Credit Agreement, there is hereby added
to the end of subsection (a) of such section a new clause which shall read as
follows:
"provided, however, that for purposes of this subparagraph (a) of
this paragraph 6.11 only, "Reporting Operating Lessees" and
"Requested Operating Lessee" shall not include Bristol."
15. Under Section 6.11 of the Credit Agreement, there is hereby added
to the end of subsection (b) of such section a new clause, which shall read as
follows:
"provided, however, that for purposes of this subparagraph (b) of
this paragraph 6.11 only, "Reporting Operating Lessees" shall not
include Bristol."
16. Under Section 7.2 of the Credit Agreement, there is hereby deleted
from such section the second sentence thereof in its entirety, and there is
hereby added to the end of the first sentence a new clause which shall read as
follows:
"except to the extent that the aggregate value of any Hotels owned
or leased by the Borrower (directly or indirectly) which are not
leased to an Operating Lessee, managed by a Manager, and operated
pursuant to and with the benefit of a License does not exceed 10%
of Total Value."
17. Section 7.4 of the Credit Agreement is hereby deleted in its
entirety and the following is hereby substituted in place thereof:
7.4 "Restricted Payments. The Borrower, unless otherwise required
in order to maintain FelCor's status as a real estate investment
trust in accordance with the written advice of independent counsel
to the Borrower, shall not, and shall not permit its Subsidiaries
to declare or authorize any dividend payment or other distribution
(such dividend or distribution shall be deemed made when so
declared or authorized) of assets, properties, cash, rights,
obligations or securities (other than the Bristol Distribution and
distributions of Stock or Stock Equivalents, exclusive of
Disqualified Stock) on account or in respect of any of its
4
5
Stock or Stock Equivalents or any payment (whether in Disqualified
Stock, Indebtedness, cash or other assets), including any sinking
fund or similar deposit, on account of the purchase, redemption,
retirement, defeasance, acquisition, cancellation or termination of
any such Stock or Stock Equivalents (collectively, "Restricted
Payments"); provided, that, notwithstanding the foregoing, (i) any
Subsidiary may make Restricted Payments, directly or indirectly, to
the Borrower or any Guarantor; (ii) any non-wholly owned Subsidiary
of the Borrower may make Restricted Payments to the holders of its
Stock or Stock Equivalents generally, so long as the Borrower or
its respective Subsidiary which owns the Stock or Stock Equivalents
in the Subsidiary paying such Restricted Payments receives at least
its proportionate share thereof (based upon its relative economic
holding of equity interest in the Subsidiary paying such Restricted
Payments and taking into account the relative preferences, if any,
of the various classes of equity interests in such Subsidiary or
the terms of any agreements applicable thereto), and (iii) the
Borrower or any Subsidiary may make payments to purchase Stock or
Stock Equivalents of any non-wholly owned Subsidiary. In addition,
in any Fiscal Quarter the Borrower may make Restricted Payments
which, when added to Restricted Payments made during the
immediately preceding three consecutive Fiscal Quarters, do not
exceed an aggregate amount equal to the lesser of 85% of the
consolidated Adjusted Funds From Operations and 100% of the Free
Cash Flow of the Borrower in each case for the immediately
preceding four consecutive Fiscal Quarters; provided further, that,
in addition to the Restricted Payments permitted above, the
Borrower may purchase, redeem or acquire Stock or Stock Equivalents
of the Borrower in an amount of up to $50,000,000.00 plus net
proceeds (including the fair market value of any property received)
of any issuance of Stock or Stock Equivalents (other than
Disqualified Stock) of the Borrower subsequent to June 30, 1999."
18. The Credit Agreement and the other Loan Documents (as defined in
the Credit Agreement) are in full force and effect without default thereunder by
Borrower and all of the representations and warranties contained in the Credit
Agreement and the other Loan Documents are hereby restated as if the same were
made as of the date hereof (it being understood and agreed that any
representation or warranty which by its terms is made on a specified date shall
be required to be true and correct only as of such specified date).
19. If there shall be any inconsistencies between the terms, covenants,
conditions and provisions set forth in the Credit Agreement, and the terms,
covenants, conditions and provisions set forth in this Second Amendment, then,
the terms, covenants, conditions and provisions of this Second Amendment shall
prevail. Whenever possible, the provisions of this Second Amendment shall be
deemed supplemental to and not in derogation of the terms of the Credit
Agreement and any documents relating thereto.
5
6
20. Each party hereto hereby confirms and ratifies all of the terms and
provisions of the Credit Agreement as amended by this Second Amendment. Except
as expressly amended hereby, all of the terms of the Credit Agreement shall
remain in full force and effect.
21. Each party hereto represents, warrants and covenants that such
party (and the undersigned representative of such party) has full power,
authority and legal right to execute this Second Amendment and to keep and
observe all of the terms of this Second Amendment and the Credit Agreement on
such party's part to be observed and performed.
22. If any term, covenant or condition of this Second Amendment shall
be held to be invalid, illegal or unenforceable in any respect, this Second
Amendment shall be construed without such provision.
23. This Second Amendment shall be binding upon the successors and
assigns of the Borrower and shall inure to the benefit of and be enforceable by
the Administrative Agent under the Credit Agreement and its successors and
assigns; provided that no Borrower may assign any of its rights or obligations
hereunder without the prior written consent of the Administrative Agent. THIS
SECOND AMENDMENT SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH AND GOVERNED
BY THE LAW OF THE STATE OF NEW YORK (WITHOUT REGARD TO PRINCIPLES OF CONFLICT OF
LAWS).
24. This Second Amendment may be executed in any number of separate
counterparts, each of which shall, collectively and separately, constitute one
agreement.
[SIGNATURES BEGIN ON THE FOLLOWING PAGE]
6
7
IN WITNESS WHEREOF, this instrument has been duly executed by the
undersigned as of the day and year first above written.
FELCOR LODGING TRUST INCORPORATED,
a Maryland corporation
By: /s/ LAWRENCE D. ROBINSON
---------------------------------
Name: Lawrence D. Robinson
Title: Senior Vice President
[SIGNATURES CONTINUE ON FOLLOWING PAGE]
8
FELCOR LODGING LIMITED PARTNERSHIP, a
Delaware limited partnership
By: FELCOR LODGING TRUST INCORPORATED, a
Maryland corporation, its sole general
partner
By: /s/ LAWRENCE D. ROBINSON
-------------------------------------
Name: Lawrence D. Robinson
Title: Senior Vice President
[SIGNATURES CONTINUE ON FOLLOWING PAGE]
9
Signature for Credit Agreement
THE CHASE MANHATTAN BANK,
as Administrative Agent
By: /s/ ALAN BREINDEL
--------------------------------
Name: Alan Breindel
Title: Managing Director
[SIGNATURES CONTINUE ON FOLLOWING PAGE]
10
REMAINDER OF SIGNATURE PAGES
INTENTIONALLY OMITTED