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EXHIBIT 10.1
AMENDMENT NO. 1, WAIVER AND CONSENT TO
THE CREDIT AGREEMENT
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AMENDMENT NO. 1, WAIVER AND CONSENT TO THE CREDIT AGREEMENT
among Lodgian Financing Corp. (the "Borrower"), Lodgian, Inc. (the "Parent"),
Impac Hotel Group, LLC, Servico Inc., the other Affiliate Guarantors party
hereto, the Lenders and Issuing Bank named herein, Morgan Stanley Senior
Funding, Inc., as Administrative Agent and Collateral Agent, Morgan Stanley
Senior Funding, Inc., as Co-Lead Arranger, Joint-Book Manager and Syndication
Agent, Lehman Brothers Inc., as Co-Lead Arranger, Joint-Book Manager and Lehman
Commercial Paper Inc., as Documentation Agent.
PRELIMINARY STATEMENTS:
(1) The Borrower, the Parent, Impac Hotel Group, LLC,
Servico, Inc., the other Affiliated Guarantors party thereto, the Initial
Lenders and Initial Issuing Bank named therein, Morgan Stanley Senior Funding,
Inc., as Administrative Agent and Collateral Agent, Morgan Stanley Senior
Funding, Inc. as Co-Lead Arranger, Joint-Book Manager and Syndication Agent,
Lehman Brothers Inc., as Co-Lead Arranger, Joint-Book Manager and Lehman
Commercial Paper Inc., as Documentation Agent have entered into that certain
credit agreement dated as of July 23, 1999 (the "Credit Agreement").
Capitalized terms not otherwise defined in this Amendment, Waiver and Consent
shall have the same meanings as specified in the Credit Agreement.
(2) The Borrower has requested, and each Lender has
agreed, to amend the Credit Agreement and to waive certain conditions therein
as herein set forth.
NOW THEREFORE, in consideration of the premises and of the
mutual covenants and agreements contained herein, the parties hereto hereby
agree as follows:
SECTION 1. Amendments to the Credit Agreement. The Credit
Agreement is, subject to the satisfaction of the conditions precedent set forth
in Section 6, hereby amended as follows:
(a) The definition of Applicable Margin in Section 1.01
is amended in full to read as follows:
`"APPLICABLE MARGIN" means, as of any time, the
higher of:
(a) a percentage per annum determined by
reference to the Public Debt Rating of the Parent, as of such
date, as set forth below;
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=================================================================================================================================
PUBLIC DEBT RATING BASE RATE EURODOLLAR BASE RATE EURODOLLAR RATE
TERM RATE WORKING WORKING
ADVANCES TERM CAPITAL CAPITAL
ADVANCES ADVANCES ADVANCES
=================================================================================================================================
Level I
Rated Ba2/BB and above 2.25% 3.50% 2.00% 3.25%
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Level II
Rated less than Level I but at least Ba3/BB-
2.50% 3.75% 2.25% 3.50%
- --------------------------------------------------------------------------------------------------------------------------------
Level III
Rated less than Level II but at least B1/B+
2.75% 4.00% 2.50% 3.75%
- --------------------------------------------------------------------------------------------------------------------------------
Level IV
Rated less than Level III 3.00% 4.25% 2.75% 4.00%
=================================================================================================================================
provided that the Applicable Margin for each Base Rate
Advance determined pursuant to this clause (a) shall be
determined by reference to the Public Debt Rating in effect
from time to time and the Applicable Margin for each
Eurodollar Rate Advance determined pursuant to this clause
(a) shall be determined by reference to the Public Debt
Rating in effect on the first day of each Interest Period for
such Advance; and
(b) 4.50% in the case of Eurodollar Rate
Advances, and 3.25% in the case of Base Rate Advances;
provided that such percentages shall be reduced by (i) 0.25%
upon prepayment of the Term B Facility (on and after July 31
2000) in an aggregate principal amount of $50,000,000 in
accordance with Section 2.06(b)(viii), and (ii) an additional
0.25% upon prepayment of the Term B Facility in an additional
aggregate principal amount of $50,000,000 in accordance with
Section 2.06(b)(viii).
The Applicable Margin in respect of the Term C Facility shall
be as set forth in the Term C Supplement."
(b) The definition of Clean-Down Period in Section 1.01
is amended by deleting the date of "August 1, 2000" and replacing it with the
date of "June 15, 2000".
(c) The definition of Excess Cash Flow in Section 1.01 is
amended by deleting paragraph (iv) and replacing it with the following new
paragraph (iv):
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"(iv) the aggregate principal amount of (A) all
optional prepayments of Term Advances made during such period
pursuant to Section 2.06(a), (B) all mandatory prepayments of
Term Advances made during such period pursuant to Section
2.06(b)(viii) (to the extent that the Net Cash Proceeds
related to such mandatory prepayments are included in the
calculation of Consolidated net income (or loss) of the
Parent and its Subsidiaries for such period) and (C) all
mandatory prepayments of Funded Debt other than those
referred to in the preceding clause (B) made in connection
with the sale of assets not constituting Hotel Collateral
plus"
(d) The definition of EBITDA in Section 1.01 is amended
by (A) deleting the phrase ", and" immediately prior to clause (ii) thereof and
replacing it with the new phrase "or expenses,", (B) inserting immediately
after clause (ii) thereof the following new phrase:
", (iii) gain or loss from the sale of hotel or development
properties but excluding any sale, lease, transfer or other
disposition of assets pursuant to clause (i), (ii) or (iii)
of Section 5.02(e), and (iv) expenses related to contract
terminations, franchise fees and other reasonable costs
directly associated with such sale, lease, transfer or other
disposition but excluding any sale, lease, transfer or other
disposition of assets pursuant to clause (i), (ii) and (iii)
of Section 5.02(e);"
and (C) inserting at the end thereof the following new proviso:
"provided further, however, that for purposes of calculating
the ratios referred to in clauses (a), (b) and (c) of Section
5.04 "EBITDA" shall be the lesser of (i) $32,900,000 for the
first quarter of the 1999 Fiscal Year, $51,400,000 for the
second quarter of the 1999 Fiscal Year, $45,600,000 for the
third quarter of the 1999 Fiscal Year and $17,200,000 for the
fourth quarter of the 1999 Fiscal Year and (ii) the actual
sum of (a), (b), (c), (d) and (e) above pursuant to this
definition of EBITDA for each of such quarters."
(e) The definition of Fixed Charge Coverage Ratio in
Section 1.01 is amended by inserting between the phrases "(excluding balloon
payments due at maturity date)" and "of all Debt for Borrowed Money" the new
phrase "and excluding payments under Section 2.06(b)".
(f) The definition of Net Cash Proceeds in Section 1.01
is amended by (i) inserting between clause (c) thereof and the phrase "in each
case to the extent", the following new clause (d):
"and (d) the expenses related to contract terminations,
franchise fees and other reasonable costs directly associated
with such sale, lease, transfer or other disposition but
excluding any sale, lease, transfer or other disposition of
assets pursuant to clause (i), (ii) or (iii) of Section
5.02(e),"
and (ii) deleting the proviso at the end thereof.
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(g) The definition of Termination Date in Section 1.01 is
amended by inserting at the end thereof the following proviso:
"provided, however, that the final maturity date of the Banc
One Facility shall not be considered for purposes of
determining the Termination Date of the Term A Facility, the
Term B Facility and for all other purposes, as long as the
Banc One Facility is paid-off, reduced to an amount of less
than or equal to $10,000,000, extended to a date later than
September 15, 2006 or refinanced by an amount greater than or
equal to the outstanding amounts under such facility on or
prior to its then final maturity date."
(h) Section 2.06(a) is amended by inserting immediately
after the phrase "incurrence or issuance of any Debt by the Parent and its
Subsidiaries" in the last sentence thereof the phrase ", the sale, transfer or
other disposition of all or substantially all of the capital stock of the
Borrower or the Parent and/or the sale, lease, transfer or other disposition of
all or substantially all the assets of the Parent and its Subsidiaries,".
(i) Section 2.06(b)(ii) is amended by (i) adding in
clause (A) thereof immediately prior to the phrase "but excluding" the phrase
"constituting Hotel Collateral", (ii) deleting the word "and" immediately prior
to clause (D) thereof and replacing such word with a comma, (iii) inserting
immediately after clause (D) and before the phrase "prepay an aggregate
principal amount" the following clause (E):
"and (E) the sale, lease, transfer or other disposition of
any assets of the Parent or any of its Subsidiaries
constituting non-Hotel Collateral but excluding any sale,
lease, transfer or other disposition of assets pursuant to
clause (i), (ii) or (iii) of Section 5.02(e),"
(iv) inserting immediately after the phrase "clause (C)" in clause (y) thereof
the phrase "or (E)", (v) adding immediately after the phrase "50% of the amount
of such Net Cash Proceeds" in clause (y) thereof the following proviso:
"provided, however, that in the case of Net Cash Proceeds
received pursuant to clause (A) above with respect to the
Marriott Hotel on Dominion Blvd. in Richmond, Virginia
referred to in Schedule 4.01(v), the Borrower shall only
prepay an aggregate principal amount of the Advances in an
amount equal to the Net Cash Proceeds thereof less the lesser
of (i) $10,000,000 or (ii) the total amount of the Capital
Expenditures made by the Borrower or any of its Subsidiaries
with respect to such property through July 31, 2000."
and (vi) deleting the phrase "ratably to the principal installments thereof" in
clause first thereof and replacing such phrase with the phrase "in order of
maturity until an aggregate principal amount of $100,000,000 has been prepaid
pursuant to this Section on and after July 31, 2000 and thereafter in inverse
order of maturity".
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(j) Section 2.06(b) is amended by adding new clauses
(viii) and (ix) at the end thereof to read as follows:
"(viii) The Borrower shall prepay (whether as an
optional or mandatory prepayment) an aggregate principal
amount of Term B Advances in an amount equal to (A)
$25,000,000 on or prior to December 31, 2000, (B) an
additional $25,000,000 on or prior to June 30, 2001, (C) an
additional $25,000,000 on or prior to December 31, 2001, and
(D) an additional $25,000,000 on or prior to June 30, 2002.
(ix) The Borrower shall, on the date of receipt
of the Net Cash Proceeds by the Parent or any of its
Subsidiaries from the sale, lease, transfer or other
disposition of any assets of the Parent or any of its
Subsidiaries constituting non-Hotel Collateral but excluding
any sale, lease, transfer or other disposition of assets
pursuant to clause (i), (ii) or (iii) of Section 5.02(e),
prepay the Working Capital Advances in an amount equal to 50%
of such Net Cash Proceeds as set forth in clause (vi) above
(without a corresponding permanent reduction in the Working
Capital Commitments)."
(k) Section 2.06(c) is amended by inserting immediately
after the phrase "prepayment of the Term B Advances" in the first sentence
thereof the phrase "(except for any prepayments made pursuant to Section
2.06(b)(viii))".
(l) Section 2.14 is amended by adding at the end thereof
the following new sentence:
"In no event shall any proceeds from Working Capital
Borrowings be used to reduce or prepay the Term B Advances
except to the extent that the Working Capital Advances have
been prepaid with the portion of Net Cash Proceeds from the
sale of assets not constituting Hotel Collateral not required
to make a prepayment in respect of the Term Facilities
pursuant to Section 2.06(b)(ii)."
(m) Section 5.01(j) is amended by (i) adding at the
beginning thereof the following language:
"(i) On or prior to September 30, 2000, the
Parent and each of its Subsidiaries shall, to the extent
permitted under the agreements and other documents governing
Debt and organization of the Parent and its Subsidiaries,
execute and deliver to the Collateral Agent a pledge or other
security agreement in form and substance satisfactory to the
Collateral Agent granting a first priority perfected security
interest in the Equity Interest of each of its Subsidiaries,
as requested by the Collateral Agent, securing payment of all
the Obligations under the Loan Documents; and
(ii)"
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and (ii) renumbering paragraphs (i) to (viii) thereof as paragraphs (A) to (H).
(n) Section 5.02(e)(iv) is amended in full to
read as follows:
"(iv) the sale of any asset by the Parent or any Subsidiary
(other than a bulk sale of inventory and a sale of
receivables other than delinquent accounts for collection
purposes only) so long as (A) the purchase price paid to the
Parent or such Subsidiary for such asset shall be no less
than (1) in the case of Hotel Collateral, 75% of the
Appraised Value of such asset (provided, that the Parent or
any subsidiary may sell Hotel Collateral for less than 75% of
the Appraised Value of such asset with the consent of the
Administrative Agent (such consent not to be unreasonably
withheld) so long as, after giving effect to such sale, the
aggregate purchase price for all Hotel Collateral sold on and
after the July 31, 2000 is at least equal to 75% of the
aggregate Appraised Value of all such Hotel Collateral sold
on and after July 31, 2000) and (2) in all other cases, 75%
of the fair market value of such asset at the time of such
sale and (B) the purchase price for such asset shall be paid
to the Parent or such Subsidiary solely in cash."
(o) Section 5.02(o) is amended by deleting the proviso
thereof and replacing it for the following new proviso:
"provided that, without regard to the foregoing limits, the
Parent and its Subsidiaries may make (i) additional Capital
Expenditures in any Fiscal Year with respect to the
renovation of hotel properties and (ii) Capital Expenditures
in an amount not to exceed $28,000,000 with respect to the
Marriott Inn hotel on Dominion Blvd. in Richmond, Virginia
referred to in Schedule 4.01(v), so long as at the time of
making any such Capital Expenditure (A) the Collateral Agent
has or is granted a perfected first priority security
interest in such property pursuant to Section 5.01(j), (B) no
Default has then occurred and is continuing or would result
therefrom and (C) both before and after such Capital
Expenditure, the Parent and its Subsidiaries are and will be
in compliance with the covenants set forth in Section 5.04."
(p) Section 5.03 is amended by (i) inserting between the
phrases "Borrower and its Subsidiaries for such Fiscal Year," and "in each case
accompanied by an opinion acceptable to the Required Lenders" in clause (b)
thereof the new phrase "(it being understood that the annual report of the
Borrower and its Subsidiaries referred to in this clause (ii) shall be included
as a footnote disclosure entitled " "Supplemental Guarantor Information" in the
annual report referred to in clause (i) above)", and (ii) adding at the end
thereof the following new clauses (p), (q) and (r):
"(p) Monthly P&L Statements. Commencing with May
2000, within 30 days after the end of each calendar month,
(i) monthly profit and loss statements, (ii) year to date
profit and loss statements and (iii) trailing 12 month profit
and loss statements, in each case with respect to each
individual real property constituting Hotel Collateral and on
a consolidated basis for all real property
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constituting Hotel Collateral, in form and substance
satisfactory to the Administrative Agent; provided, however,
that the reports for the months of May and June 2000 shall be
delivered on or before August 15, 2000, and the reports for
the month of July 2000 shall be delivered on or before
September 15, 2000.
(q) Quarterly Financial Statements. (i) On or
prior to August 31, 2000, the financial information referred
to in Section 5.03(c) for the quarter ended March 31, 2000
and (ii) on or prior to September 30, 2000, the financial
information referred to in Section 5.03(c) for the quarter
ended June 30, 2000.
(r) Certificates With Respect to Certain
Financial Statements. No later than August 15, 2000, in
respect of the annual audit report for the 1999 Fiscal Year
of the Parent and its Subsidiaries, an opinion acceptable to
the Required Lenders of independent public accountants of
nationally recognized standing acceptable to the Required
Lenders, together with (A) a certificate of such accounting
firm to the Lender Parties stating that, as of the date of
such annual audit report, in the course of conducting its
audit of the business of the Parent, such accounting firm has
obtained no knowledge that a Default has occurred and is
continuing, or if, in the opinion of such accounting firm, a
Default has occurred and is continuing, a statement as to the
nature thereof, and (B) a schedule in form satisfactory to
the Agent of the computations used by such accountants in
determining, as of the end of the 1999 Fiscal Year,
compliance or noncompliance with the covenants in Section
5.04 (and confirmation from such accountants (satisfactory to
the Administrative Agent in its sole discretion) with respect
to the calculation of compliance or noncompliance with the
covenants contained in Section 5.04), provided that in the
event of any change in GAAP used in preparation of such
financial statements, the Parent shall also provide, if
necessary for the determination of compliance with Section
5.04, a statement of reconciliation conforming such financial
statements to GAAP."
(q) Section 5.04 is amended by (i) deleting the ratio
"6.25:1" set forth opposite the date "June 30, 2000" in clause (a) thereof and
replacing it with the new ratio "6.50:1", (ii) deleting the table in clause (b)
thereof and replacing it with the following new table:
=================================================================================
QUARTER ENDING RATIO
=================================================================================
December 31, 1999 0.97:1
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March 31, 2000 1.00:1
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June 30, 2000 0.90:1
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September 30, 2000 0.90:1
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December 31, 2000 and thereafter 1.00:1
=================================================================================
(iii) deleting the table in clause (c) thereof and replacing it with the
following new table:
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===============================================================================
QUARTER ENDING RATIO
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September 30, 1999 1.75:1
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December 31, 1999 1.75:1
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March 31, 2000 1.75:1
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June 30, 2000 1.45:1
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September 30, 2000 1.45:1
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December 31, 2000 1.50:1
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March 31, 2001 1.50:1
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June 30, 2001 1.50:1
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September 30, 2001 1.50:1
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December 31, 2001 1.60:1
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March 31, 2002 1.60:1
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June 30, 2002 1.60:1
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September 30, 2002 1.60:1
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December 31, 2002 1.70:1
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March 31, 2003 1.70:1
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June 30, 2003 1.70:1
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September 30, 2003 1.70:1
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December 31, 2003 and thereafter 1.80:1
===============================================================================
(iv) deleting the ratio "4.00:1" set forth opposite the date "June 30, 2000" in
clause (d) thereof and replacing it with the new ratio "4.25:1", (v) deleting
the ratio "4.00:1" set forth opposite the date "September 30, 2000" in clause
(d) thereof and replacing it with the new ratio "4.25:1", (vi) deleting the
ratio "4.50:1" set forth opposite the date "December 31, 2000" in clause (d)
thereof and replacing it with the new ratio "4.00:1", (vii) deleting the ratio
"4.50:1" set forth opposite the date "March 31, 2001" in clause (d) thereof and
replacing it with the new ratio "4.00:1", (viii) deleting the ratio "4.50:1"
set forth opposite the date "June 30, 2001" in clause (d) thereof and replacing
it with the new ratio "4.00:1", and (ix) deleting the ratio "4.50:1" set forth
opposite the date "September 30, 2001" in clause (d) thereof and replacing it
with the new ratio "4.00:1".
(r) Section 6.01(c) is amended by adding immediately
after the phrase "5.03(a)" therein the phrase ", 5.03(q), 5.03(r)".
SECTION 2. Further Amendments to the Credit Agreement. The
Credit Agreement is, subject to the satisfaction of the conditions precedent
set forth in Section 6 and the conditions precedent set forth below, hereby
amended as follows:
(a) Subject to the Administrative Agent having received
counterparts of this Amendment, Waiver and Consent executed by the Borrower and
all the Lenders or, as to any of the Lenders, advice satisfactory to the
Administrative Agent that such Lender has executed this Amendment, Waiver and
Consent, the definition of Applicable Margin in Section 1.01 is further amended
by adding at the end thereof the following new paragraph:
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"Notwithstanding anything to the contrary herein, the
Applicable Margin shall be 3.25% in the case of Eurodollar
Rate Advances and 2.00% in the case of Base Rate Advances at
any time that the Consolidated Senior Debt to Hotel
Collateral EBITDA Ratio calculated in accordance with Section
5.04(d) is less than or equal to 2.50:1.00. The Applicable
Margin in respect of the Term C Facility shall be as set
forth in the Term C Supplement."
(b) Subject to the Administrative Agent having received
counterparts of this Amendment, Waiver and Consent executed by the Borrower and
all the Term B Lenders or, as to any of the Term B Lenders, advice satisfactory
to the Administrative Agent that such Lender has executed this Amendment,
Waiver and Consent, Section 2.06(a) is amended by adding at the end thereof the
following language:
"Notwithstanding anything to the contrary herein, the
Borrower shall not pay the premiums referred to in clause
(ii) above with respect to any optional prepayments of Term B
Advances with Net Cash Proceeds from the sale, lease,
transfer or other disposition of any assets of the Parent or
any of its Subsidiaries not constituting Hotel Collateral."
(c) Subject to the Administrative Agent having received
counterparts of this Amendment, Waiver and Consent executed by the Borrower and
all the Term B Lenders or, as to any of the Term B Lenders, advice satisfactory
to the Administrative Agent that such Lender has executed this Amendment,
Waiver and Consent, paragraph (viii) of Section 2.06(b) (which was added by
Section 1 of this Amendment, Waiver and Consent) is amended in full to read as
follows:
"(viii) The Borrower shall prepay (whether as an
optional or mandatory prepayment) an aggregate principal
amount of Term B Advances in an amount equal to (A)
$25,000,000 on or prior to December 31, 2000, (B) an
additional $35,000,000 on or prior to June 30, 2001, and (C)
an additional $40,000,000 on or prior to December 31, 2001."
SECTION 3. Waiver. Subject to the satisfaction of the
conditions precedent set forth in Section 6 hereof, each Lender agrees to:
(a) Solely for the purposes of the 1999 Fiscal Year,
waive the requirements of Section 5.03(b) of the Credit Agreement solely for
the period from March 31, 2000 through the Amendment Effective Date (as herein
defined).
(b) Solely for the purposes of the first quarter of the
2000 Fiscal Year, waive the requirements of Section 5.03(c) of the Credit
Agreement solely for the period from May 15, 2000 through August 31, 2000. On
August 31, 2000, without any further action by the Administrative Agent and the
Lenders, all of the terms and provisions set forth in the Loan Documents with
respect to Defaults thereunder that are waived under this Section 3(b) and not
cured prior to such date shall have the same force and effect as if this
Amendment, Waiver and
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Consent had not been entered into by the parties hereto, and the Administrative
Agent and the Lenders shall have all of the rights and remedies afforded to
them under the Loan Documents with respect to any such Defaults as though no
waiver had been granted by them hereunder.
(c) Solely for the purposes of the second quarter of the
2000 Fiscal Year, waive the requirements of Section 5.03(c) of the Credit
Agreement solely for the period from July 15, 2000 through September 30, 2000.
On September 30, 2000, without any further action by the Administrative Agent
and the Lenders, all of the terms and provisions set forth in the Loan
Documents with respect to Defaults thereunder that are waived under this
Section 3(c) and not cured prior to such date shall have the same force and
effect as if this Amendment, Waiver and Consent had not been entered into by
the parties hereto, and the Administrative Agent and the Lenders shall have all
of the rights and remedies afforded to them under the Loan Documents with
respect to any such Defaults as though no waiver had been granted by them
hereunder.
(d) Solely for the purposes of the first quarter of the
2000 Fiscal Year, waive the requirements of Section 5.04(a), (b), (c) and (d).
(e) Waive each of the Defaults set forth on Exhibit A to
this Amendment, Waiver and Consent.
SECTION 4. Consent. Subject to the satisfaction of the
conditions precedent set forth in Section 6 hereof, each Lender hereby consents
to:
(a) The acquisition by Lodgian Acquisitions, LLC , which
is a single-member Georgia limited liability company wholly-owned by
the Borrower, of limited partnership interests (the "Partnership
Interests") representing up to 49% of the Equity Interests in each of
Worcester Hospitality Associates limited Partnership, a Florida limited
partnership, Sioux City Hospitality, L.P., an Iowa limited partnership,
Brecksville Hospitality, L.P., an Ohio limited partnership, Fort Wayne
Hospitality Associates II, Limited Partnership, a Florida limited
partnership, 1075 Hospitality, L.P., a Georgia limited partnership and
Saginaw Hospitality Limited Partnership, a Michigan limited partnership
(together, the "Limited Partnerships") and the request of the Borrower
that it (through its Affiliates) only be required to give a first
priority security interest in favor of the Collateral Agent for the
benefit of the Secured Parties pursuant to Section 5.01(j) of the
Credit Agreement in (i) the Borrower's interest in Lodgian
Acquisitions, LLC and (ii) the Partnership Interests notwithstanding
any other provision of the Loan Documents; and
(b) The request of the Borrower that Saginaw Hospitality
Limited Partnership permit, agree or consent to the foreclosure of the
purchase money non-recourse mortgage, dated October 12, 1995, related
to its interest in the premises and personalty in the City of Saginaw,
Saginaw County, Michigan, notwithstanding any other provision of the
Loan Documents.
SECTION 5. Termination of Term A Commitments. In accordance
with the provisions of Section 2.05(a) of the Credit Agreement, the Borrower
hereby, as of the date
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hereof, terminates in whole the Unused Term A Commitments. The requirement of
five Business Days' notice for termination of the unused Term A Commitments is
hereby waived by the Required Lenders.
SECTION 6. Conditions of Effectiveness of this Amendment.
This Amendment, Waiver and Consent shall become effective as of the date first
above written (the "Amendment Effective Date") when, and only when, the
Administrative Agent shall have received counterparts of this Amendment, Waiver
and Consent executed by the Borrower and the Required Lenders or, as to any of
the Lenders, advice satisfactory to the Administrative Agent that such Lender
has executed this Amendment, Waiver and Consent, and the consent attached
hereto by each Loan Party (other than the Borrower), and shall become effective
when and only when the Administrative Agent shall have additionally received
all of the following (which in the case of documents shall be in form and
substance satisfactory to the Required Lenders and in sufficient copies for
each Lender):
(a) (i) the annual audit report for the 1999
Fiscal Year for the Parent and its Subsidiaries, including therein a
Consolidated balance sheet of the Parent and its Subsidiaries as of the
end of the 1999 Fiscal Year and a Consolidated statement of income and
a Consolidated statement of cash flows of the Parent and its
Subsidiaries for the 1999 Fiscal Year, in each case accompanied by an
opinion of independent public accountants of nationally recognized
standing acceptable to the Required Lenders, and (ii) the annual report
for the 1999 Fiscal Year for the Borrower and its Subsidiaries,
including therein a Consolidated balance sheet of the Borrower and its
Subsidiaries as of the end of the 1999 Fiscal Year and a Consolidated
statement of income and a Consolidated statement of cash flows of the
Borrower and its Subsidiaries for the 1999 Fiscal Year (it being
understood that the annual report referred to in this clause (ii) will
be included in the annual report referred to in clause (i) above) and
(iii) a certificate of the Chief Financial Officer of the Parent
stating that no Default has occurred and is continuing under Section
5.04 and a certificate of the Chief Executive Officer (or person
performing a similar function) of the Parent stating that no Default
has occurred and is continuing under any other provision of the Loan
Documents or, if a default has occurred and is continuing, a statement
as to the nature thereof and the action that the Parent and the
Borrower have taken and proposes to take with respect thereto;
(b) a draft Consolidated balance sheet of the
Parent and its Subsidiaries as of the end of the first quarter of the
2000 Fiscal Year and a draft Consolidated statement of operations of
the Parent and its Subsidiaries for the period commencing with the end
of the 1999 Fiscal Year and ending with the end of the first quarter of
the 2000 Fiscal Year, setting forth in comparative form the
corresponding figures for the corresponding date or period of the 1999
Fiscal Year, all in reasonable detail and duly certified as described
in the following subparagraph (c) (subject to the normal year-end audit
adjustments) by the Chief Financial Officer (or person performing a
similar function) of the Parent as having been prepared in accordance
with GAAP, together with (A) a draft certificate of said officer
stating that no Default has occurred and is continuing or, if a Default
has occurred and is continuing, a statement as to the nature thereof
and the action that the Parent and the Borrower have taken and proposes
to
12
12
take with respect thereto and (B) a schedule in form satisfactory the
Administrative Agent of the computations used by the Parent in
determining compliance with the covenants contained in Section 5.04 of
the Credit Agreement (it being understood that the covenants are
calculated based on the draft Consolidated statement of operations and
other information, which is subject to revision);
(c) a certificate duly signed by the Chief Financial
Officer of the Parent representing that the financial statements
referenced in paragraph (b) above are draft representations of the
Parent's and its Subsidiaries' financial position pending completion of
the Parent's review procedures and a Statement on Auditing Standards
(SAS) #71 review by the Parent's auditors;
(d) a certificate duly signed by a the Chief Executive
Officer (or person performing a similar function) of the Borrower
stating that the representations and warranties contained in the Credit
Agreement and each Loan Document are correct on and as of the date of
such certificate as though made on and as of the date hereof other than
any such representation and warranties that, by their terms, refer to a
date other than the date of such certificate; and
(e) a fee equal to 1/2 of 1% of the aggregate Advances
and Commitments of each Lender executing this Amendment, Waiver and
Consent after giving effect to this Amendment, Waiver and Consent
(which fee shall be credited to any prepayment fees payable pursuant to
Section 2.06(a) of the Credit Agreement in connection with any
prepayment in full of the Advances during the first year following the
Amendment Effective Date).
(f) all invoiced reasonable and actual costs and expenses
of each Agent (including consultant and advisor fees and expenses and
all reasonable fees and expenses of counsel to the Agent).
Section 7. Concerning the Financial Statements and the
Calculation of the Financial Covenants. The parties hereto acknowledge that (i)
all financial statements delivered pursuant to this Amendment, Waiver and
Consent, (ii) all financial statements to be delivered pursuant to the Credit
Agreement as amended by this Amendment, Waiver and Consent, (iii) all
calculations of financial covenants under Section 5.04 of the Credit Agreement
reflected in certificates delivered pursuant to this Amendment, Waiver and
Consent, and (iv) all calculations of financial covenants under Section 5.04 of
the Credit Agreement as amended by this Amendment, Waiver and Consent reflected
in certificates to be delivered pursuant to the Credit Agreement as amended by
this Amendment, Waiver and Consent, in each case, were and will be prepared
giving effect to the amendments to be effected by this Amendment, Waiver and
Consent.
Section 8. Representations and Warranties. The Borrower
represents and warrants as follows:
13
13
(a) On the Amendment Effective Date, after giving effect
to this Amendment, Waiver and Consent, no event has occurred and is
continuing, or would result from the effectiveness of this Amendment,
Waiver and Consent, that constitutes a Default.
(b) No authorization, approval or other action by, an no
notice to or filing with, any governmental authority or regulatory body
or any other third party is required for the due execution, delivery,
recordation, filing or performance by the Borrower of this Amendment,
Waiver and Consent or other transactions contemplated hereby.
(c) This Amendment, Waiver and Consent has been duly
executed and delivered by the Borrower. Each of this Amendment, Waiver
and Consent and the Credit Agreement is the legal, valid and binding
obligations of the Borrower, enforceable against the Borrower in
accordance with its terms.
Section 9. Reference to and Effect on the Loan Documents. (a)
On and after the Amended Effective Date, each reference in the Credit Agreement
to "this Agreement", "hereunder", "hereof" or words of like import referring to
the Credit Agreement, and each reference in each of the other Loan Documents to
"the Credit Agreement", "thereunder", "thereof" or words of like import
referring to the Credit Agreement, shall mean and be a reference to the Credit
Agreement, as amended by this Amendment, Waiver and Consent.
(b) The Credit Agreement, as specifically amended by this
Amendment, Waiver and Consent, is and shall continue to be in full force and
effect and is hereby in all respects ratified and confirmed. Without limiting
the generality of the foregoing, the Collateral Documents and all of the
Collateral described therein do and shall continue to secure the payment of all
of the Obligations of the Loan Parties under the Loan Documents, as amended
hereby.
(c) The execution, delivery and effectiveness of this
Amendment, Waiver and Consent shall not operate as a waiver of any right, power
or remedy of any of the Lenders or the Administrative Agent under any of the
Loan Documents, nor constitute a waiver of, or a consent to depart from, any of
the terms and conditions of any of the Loan Documents.
Section 10. Execution in Counterparts. This Amendment, Waiver
and Consent may be executed in any number of counterparts and by different
parties hereto in separate counterparts, each of which when so executed shall
be deemed to be an original and all of which taken together shall constitute
one and the same agreement. Delivery of an executed counterpart of a signature
page to this Amendment, Waiver and Consent by telecopier shall be effective as
delivery of a manually executed counterpart of this Amendment, Waiver and
Consent.
Section 11. Governing Law. This Amendment, Waiver and Consent
shall be governed by, and construed in accordance with, the laws of the State
of New York.
14
14
IN WITNESS WHEREOF, the parties hereto have caused this
Amendment, Waiver and Consent to be duly executed and delivered by its officer
thereunder duly authorized, as of the first written above.
LODGIAN FINANCING CORP.
By
-----------------------------------
Title:
LODGIAN, INC.
By
-----------------------------------
Title:
MORGAN STANLEY SENIOR
FUNDING, INC., as Administrative Agent
By
-----------------------------------
Title:
LEHMAN COMMERCIAL PAPER INC., as
Documentation Agent
By
-----------------------------------
Title:
15
LENDERS:
MORGAN STANLEY SENIOR FUNDING, INC.
By:
---------------------------------
Title:
16
ARCHIMEDES FUNDING II, LTD.
By: ING Capital Advisors LLC, as Collateral
Manager
By:
---------------------------------
Title:
17
ARCHIMEDES FUNDING III, LTD.
By: ING Capital Advisors LLC, as Collateral
Manager
By:
---------------------------------
Title:
18
BLACK DIAMOND CLO 1998
By:
---------------------------------
Title:
19
BLACK DIAMOND CLO 2000
By:
---------------------------------
Title:
20
CARLYLE HIGH YIELD PARTNERS, LP
By:
---------------------------------
Title:
21
CARLYLE HIGH YIELD PARTNERS II, LTD.
By:
---------------------------------
Title:
22
CHANG HWA
By:
---------------------------------
Title:
23
CANADIAN IMPERIAL BANK OF COMMERCE
By:
---------------------------------
Title:
24
ELF FUNDING TRUST I
By:
---------------------------------
Title:
25
GLENEAGLES
By:
---------------------------------
Title:
26
THE ING CAPITAL SENIOR SECURED HIGH
INCOME FUND, L.P.
By: ING Capital Advisors LLC, as Investment
Advisor
By:
---------------------------------
Title:
27
KZH HIGHLAND-2
By:
---------------------------------
Title:
28
KZH III
By:
---------------------------------
Title:
29
KZH STERLING LLC
By:
---------------------------------
Title:
30
LEHMAN BROTHERS
By:
---------------------------------
Title:
31
ML CBO IV
By:
---------------------------------
Title:
32
MERRILL LYNCH SENIOR FLOATING RATE FUND, INC.
By:
------------------------------------------
Title:
33
MERRILL LYNCH SENIOR FLOATING RATE
FUND II, INC.
By:
---------------------------------
Title:
34
PILGRIM CLO
By:
---------------------------------
Title:
35
PROVIDENT
By:
---------------------------------
Title:
36
SEQUILS-ING I (HBDGM), LTD.
By: ING Capital Advisors LLC, as Collateral
Manager
By:
---------------------------------
Title:
37
STANFIELD CLO LTD.
By: Stanfield Capital Partners LLC, as its
Collateral Manager
By:
---------------------------------
Title:
38
SUTTER CBO 1998-1
By:
---------------------------------
Title:
39
SUTTER CBO 1999-1
By:
---------------------------------
Title:
40
TRANSAMERICA EQUIPMENT FINANCIAL
SERVICES CORPORATION
By:
---------------------------------
Title:
41
WELLS FARGO BANK
By:
---------------------------------
Title:
42
CONSENT
Dated as of July 31, 2000
Each of the undersigned as a Loan Party under the Credit
Agreement referred to in the foregoing Amendment, Waiver and Consent, hereby
consents to such Amendment, Waiver and Consent and hereby confirms and agrees
that (a) notwithstanding the effectiveness of such Amendment, Waiver and
Consent, each Loan Document to which such Loan Party is a party is, and shall
continue to be, in full force and effect and is hereby ratified and confirmed
in all respects, except that, on and after the effectiveness of such Amendment,
Waiver and Consent, each reference in each Loan Document to the "Credit
Agreement", "thereunder", "thereof" or words of like import shall mean and be a
reference to the Credit Agreement, as amended by such Amendment, Waiver and
Consent, and (b) the Collateral Documents to which such Loan Party is a party
and all of the Collateral described therein do, and shall continue to, secure
the payment of all of the Secured Obligations (in each case, as defined
therein).
SERVICO, INC.
By
------------------------------------------
Title:
IMPAC HOTEL GROUP, LLC
By
------------------------------------------
Title:
SHEFFIELD MOTEL ENTERPRISES, INC.
DOTHAN HOSPITALITY 3053, INC.
DOTHAN HOSPITALITY 3071, INC.
GADSDEN HOSPITALITY, INC.
LODGIAN ANAHEIM INC.
LODGIAN ONTARIO INC.
SERVICO PENSACOLA, INC.
SERVICO PENSACOLA 7200, INC.
SERVICO PENSACOLA 7330, INC.
SERVICO FT. PIERCE, INC.
SERVICO WEST PALM BEACH, INC.
SERVICO WINTER HAVEN, INC.
43
2
ALBANY HOTEL, INC.
SERVICO NORTHWOODS, INC.
BRUNSWICK MOTEL ENTERPRISES, INC.
SERVICO CEDAR RAPIDS, INC.
SERVICO METAIRIE, INC.
SERVICO COLUMBIA, INC.
SERVICO COLESVILLE, INC.
SERVICO MARYLAND, INC. NH MOTEL ENTERPRISES, INC.
MINNEAPOLIS MOTEL ENTERPRISES, INC.
SERVICO ROSEVILLE, INC.
LODGIAN MOUNT LAUREL, INC.
SERVICO JAMESTOWN, INC.
SERVICO NEW YORK, INC.
SERVICO NIAGARA FALLS, INC.
SERVICO GRAND ISLAND, INC.
FAYETTEVILLE MOTEL ENTERPRISES, INC.
APICO INNS OF GREEN TREE, INC.
APICO HILLS, INC.
SERVICO HILTON HEAD, INC.
SERVICO AUSTIN, INC.
SERVICO MARKET CENTER, INC.
SERVICO HOUSTON, INC.
By:
----------------------------------------------
Title: Vice President
AMI OPERATING PARTNERS, L.P.
By: AMIOP Acquisition Corp., its general partner
By:
----------------------------------------------
Title:
SERVICO CENTRE ASSOCIATES, LTD.
By: Palm Beach Motel Enterprises, its general
partner
By:
----------------------------------------------
Title:
44
3
LITTLE ROCK LODGING ASSOCIATES I,
LIMITED PARTNERSHIP
By: Lodgian Richmond SPE Inc.
By:
----------------------------------------------
Title:
ATLANTA HILLSBORO LODGING, LLC
LODGIAN RICHMOND L.L.C.
By:
----------------------------------------------
Title: Manager
45
EXHIBIT A
TO AMENDMENT NO. 1, WAIVER AND CONSENT TO
THE CREDIT AGREEMENT
1. Solely for the period ending October 31, 2000, waive
the requirements of Section 5.01(b) of the Credit Agreement solely with respect
to the failure of the Parent and its Affiliates to pay approximately $2,500,000
of federal, state and local payroll taxes for 1998 through April, 2000. The
Parent has properly accrued for such payment in its 1999 and 2000 financial
statement.
2. Solely for the period ending on the Amendment
Effective Date, waive the requirements of Section 5.02(o)(iii) of the Credit
Agreement.
3. Solely for the period ending on the Amendment
Effective Date, waive the requirements of Section 5.03(a) of the Credit
Agreement solely with respect to the failure of the Parent to provide a
statement setting forth the details of the Defaults being waived pursuant to
this Amendment, Waiver and Consent.
4. Solely for the period ending on the Amendment
Effective Date, waive the requirements of Section 5.03(g) of the Credit
Agreement solely with respect to a failure, if any, by the Borrower to provide
notice of copies of any notice, request or document received by any Loan Party
or any of its Subsidiaries regarding or related to any breach or default by any
party under any Material Contract to the extent required by Section 5.03(g) of
the Credit Agreement (it being understood that such breach or default, if any,
would not constitute a Material Adverse Effect).