EXHIBIT 10.36
REVOLVING CREDIT AND GUARANTY AGREEMENT
Among
LODGIAN, INC.,
a Debtor and a Debtor-in-Possession under Chapter 11 of the Bankruptcy Code
as Borrower
and
THE SUBSIDIARIES OF THE BORROWER NAMED HEREIN,
certain of which are a Debtor and a Debtor-in-Possession under Chapter 11 of the
Bankruptcy Code
as Guarantors
and
THE LENDERS PARTY HERETO,
and
MORGAN STANLEY SENIOR FUNDING, INC.,
as Administrative Agent and Collateral Agent
Dated as of December 31, 2001.
ARTICLE 1
DEFINITIONS
SECTION 1.01. Defined Terms ........................................................2
SECTION 1.02. Terms Generally .....................................................18
ARTICLE 2
AMOUNT AND TERMS OF CREDIT
SECTION 2.01. Commitment of the DIP Lenders .......................................18
SECTION 2.02. Availability of Commitment ..........................................18
SECTION 2.03. Letters of Credit ...................................................18
SECTION 2.04. Issuance ............................................................21
SECTION 2.05. Nature of Letter of Credit Obligations Absolute .....................21
SECTION 2.06. Making of Loans .....................................................22
SECTION 2.07. Repayment of Loans; Evidence of Debt ................................23
SECTION 2.08. Interest on Loans ...................................................23
SECTION 2.09. Default Interest ....................................................24
SECTION 2.10. Optional Termination or Reduction of Commitment .....................24
SECTION 2.11. Alternate Rate of Interest ..........................................24
SECTION 2.12. Refinancing of Loans ................................................25
SECTION 2.13. Mandatory Prepayment, Commitment Reduction and Termination; Cash
Collateral ..........................................................26
SECTION 2.14. Optional Prepayment of Loans; Reimbursement of DIP Lenders ..........27
SECTION 2.15. Reserve Requirements; Change in Circumstances .......................29
SECTION 2.16. Change in Legality ..................................................30
SECTION 2.17. Pro Rata Treatment, Etc .............................................31
SECTION 2.18. Taxes ...............................................................31
SECTION 2.19. Certain Fees ........................................................34
SECTION 2.20. Commitment Fee ......................................................34
SECTION 2.21. Letter of Credit Fees ...............................................34
SECTION 2.22. Nature of Fees ......................................................35
SECTION 2.23. Priority and Liens ..................................................35
SECTION 2.24. Right of Set-off ....................................................37
SECTION 2.25. Security Interest in Letter of Credit Account .......................37
SECTION 2.26. Payment of Obligations ..............................................37
SECTION 2.27. No Discharge; Survival of Claims ....................................38
SECTION 2.28. Use of Cash Collateral ..............................................38
SECTION 2.29. General Provisions as to Payments ...................................38
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ARTICLE 3
REPRESENTATIONS AND WARRANTIES
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SECTION 3.01. Organization and Authority ...........................................38
SECTION 3.02. Due Execution ........................................................39
SECTION 3.03. Statements Made ......................................................39
SECTION 3.04. Financial Statements .................................................40
SECTION 3.05. Ownership ............................................................40
SECTION 3.06. Liens ................................................................40
SECTION 3.07. Compliance with Law ..................................................41
SECTION 3.08. Insurance ............................................................41
SECTION 3.09. The Orders ...........................................................41
SECTION 3.10. Use of Proceeds ......................................................41
SECTION 3.11. Litigation ...........................................................41
SECTION 3.12. Intellectual Property ................................................42
SECTION 3.13. Letters of Credit ....................................................42
SECTION 3.14. Pre-Petition Indebtedness ............................................42
SECTION 3.15. Properties ...........................................................42
SECTION 3.16. Leases ...............................................................42
SECTION 3.17. Investments ..........................................................43
ARTICLE 4
CONDITIONS OF LENDING
SECTION 4.01. Conditions Precedent to Closing and Extension of Initial Loans and
Initial Letters of Credit ............................................43
SECTION 4.02. Conditions Precedent to Each Loan and Each Letter of Credit ..........46
ARTICLE 5
AFFIRMATIVE COVENANTS
SECTION 5.01. Financial Statements, Reports, Etc ...................................48
SECTION 5.02. Corporate Existence ..................................................51
SECTION 5.03. Insurance ............................................................51
SECTION 5.04. Obligations and Taxes ................................................51
SECTION 5.05. Notice of Event of Default, etc ......................................52
SECTION 5.06. Access to Books and Records ..........................................52
SECTION 5.07. Maintenance of Concentration Account .................................53
SECTION 5.08. Budget ...............................................................53
SECTION 5.09. Furnishing of Additional Items .......................................53
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ARTICLE 6
NEGATIVE COVENANTS
SECTION 6.01. Liens .....................................................55
SECTION 6.02. Merger, etc ...............................................55
SECTION 6.03. Indebtedness ..............................................55
SECTION 6.04. Capital Expenditures ......................................55
SECTION 6.05. Financial Covenants .......................................56
SECTION 6.06. Guarantees and Other Liabilities ..........................56
SECTION 6.07. Chapter 11 Claims .........................................57
SECTION 6.08. Dividends; Capital Stock ..................................57
SECTION 6.09. Transactions with Affiliates ..............................57
SECTION 6.10. Investments, Loans and Advances ...........................57
SECTION 6.11. Disposition of Assets .....................................58
SECTION 6.12. Nature of Business ........................................59
SECTION 6.13. Cash Management System ....................................59
ARTICLE 7
EVENTS OF DEFAULT
SECTION 7.01. Events of Default .........................................59
ARTICLE 8
THE AGENT
SECTION 8.01. Administration by Agent ...................................63
SECTION 8.02. Advances and Payments .....................................63
SECTION 8.03. Sharing of Setoffs ........................................64
SECTION 8.04. Agreement of Required DIP Lenders .........................64
SECTION 8.05. Liability of Agent ........................................64
SECTION 8.06. Reimbursement and Indemnification .........................65
SECTION 8.07. Rights of Agent ...........................................66
SECTION 8.08. Independent DIP Lenders ...................................66
SECTION 8.09. Notice of Transfer ........................................66
SECTION 8.10. Successor Agent ...........................................66
ARTICLE 9
GUARANTY
SECTION 9.01. Guaranty ..................................................67
SECTION 9.02. No Impairment of Guaranty .................................68
SECTION 9.03. Subrogation ...............................................68
SECTION 9.04. Release of Guaranty .......................................68
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ARTICLE 10
MISCELLANEOUS
SECTION 10.01. Notices ..........................................................69
SECTION 10.02. Survival of Agreement, Representations and Warranties, etc .......69
SECTION 10.03. Successors and Assigns ...........................................69
SECTION 10.04. Confidentiality ..................................................72
SECTION 10.05. Expenses .........................................................73
SECTION 10.06. Indemnity ........................................................73
SECTION 10.07. CHOICE OF LAW ....................................................74
SECTION 10.08. No Waiver ........................................................74
SECTION 10.09. Extension of Maturity ............................................74
SECTION 10.10. Amendments, etc ..................................................74
SECTION 10.11. Severability .....................................................75
SECTION 10.12. Headings .........................................................76
SECTION 10.13. Execution in Counterparts ........................................76
SECTION 10.14. Prior Agreements .................................................76
SECTION 10.15. Further Assurances ...............................................76
SECTION 10.16. WAIVER OF JURY TRIAL .............................................76
ANNEX A -- Commitment Amounts
EXHIBIT A -- Form of Assignment and Acceptance
EXHIBIT B -- Form of Note
EXHIBIT C -- Form of Interim Order
EXHIBIT D -- Form of Security and Pledge Agreement
EXHIBIT E -- Form of Counsel Opinion
SCHEDULE 1.01(a) -- Existing Joint Ventures
SCHEDULE 3.05 -- Subsidiaries
SCHEDULE 3.06 -- Liens
SCHEDULE 3.11 -- Litigation
SCHEDULE 3.12 -- Intellectual Property
SCHEDULE 3.14 -- Pre-Petition Indebtedness
SCHEDULE 3.15 -- Hotel Properties
SCHEDULE 3.16 -- Leases
SCHEDULE 3.17 -- Existing Investments.
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REVOLVING CREDIT AND GUARANTY AGREEMENT, dated as of December 31,
2001, among LODGIAN, INC., a Delaware corporation (the "BORROWER"), a debtor
and debtor-in-possession in a case pending under chapter 11 of the Bankruptcy
Code, and each of the direct or indirect subsidiaries of the Borrower signatory
hereto (each, a "GUARANTOR" and collectively, the "GUARANTORS"), certain of
which Guarantors is a debtor and debtor-in-possession in a case pending under
chapter 11 of the Bankruptcy Code (the cases of the Borrower and certain of the
Guarantors, each a "CASe" and collectively, the "CASEs"), MORGAN STANLEY SENIOR
FUNDING, INC., ("MSSF"), LEHMAN BROTHERS, INC., ("LEHMAN" and together with
MSSF, the "CO-ARRANGERs") and each of the other financial institutions from
time to time party hereto (together with MSSF and Lehman, the "DIP LENDERS"),
MSSF, as administrative agent and collateral agent (in such capacity, the
"AGENT") for the DIP Lenders.
INTRODUCTORY STATEMENT
On December 20, 2001 (the "PETITION DATE"), the Borrower and certain
of the Guarantors filed voluntary petitions with the Bankruptcy Court
initiating the Cases and have continued in the possession of their assets and
in the management of their businesses pursuant to Sections 1107 and 1108 of the
Bankruptcy Code.
The Borrower has applied to the DIP Lenders for a revolving credit and
letter of credit facility in an aggregate principal amount not to exceed
$25,000,000, all of the Borrower's obligations under which are to be guaranteed
by the Guarantors.
The proceeds of the Loans will be used only to finance capital
expenditures on Primed Hotel Properties, as defined below, and to finance
operations of the Borrower and certain of the Guarantors (including interest
payable to Pre-Petition Lenders and the DIP Lenders), all in accordance with a
budget approved by the Agent as hereinafter provided.
To provide guarantees and security for the repayment of the Loans, the
reimbursement of any draft drawn under a Letter of Credit and the payment of
the other obligations of the Borrower and the Guarantors hereunder and under
the other Loan Documents (including, without limitation, the Obligations of the
Borrower under Section 6.03(a)(iv)), the Borrower and the Guarantors will
provide to the Agent and the DIP Lenders the following (each as more fully
described herein and as to the Guarantors only as applicable thereto):
(a) a guaranty from each of the Guarantors of the due and
punctual payment and performance of the obligations of the Borrower hereunder;
(b) an allowed administrative expense claim in each of the Cases
pursuant to Section 364(c)(1) of the Bankruptcy Code having priority over all
administrative expenses of the kind specified in, or arising under, any
Sections of the Bankruptcy Code (including, without limitation, Sections 105,
326, 328, 330, 331, 503(b), 507(a), 507(b),
546(c) or 726 thereof) pursuant to Section 364(c)(i) of the Code, whether or
not such claims or expenses may become secured by a judgment lien or other
non-consensual lien, levy or attachment;
(c) a perfected Lien, pursuant to Section 364(c)(2) of the
Bankruptcy Code, on all unencumbered property of the Borrower and the
Guarantors (subject, in the case of leaseholds, to any notices required under
applicable law) and on all cash and cash equivalents in the Letter of Credit
Account, provided that amounts in the Letter of Credit Account shall not be
subject to the Carve-Out hereinafter referred to;
(d) a perfected Lien, pursuant to Section 364(c)(3) of the
Bankruptcy Code, upon all property of the Borrower and the Guarantors (other
than the Primed Assets and certain other exceptions), junior to existing valid
and perfected Liens on such property, junior to Liens on such property granted
as adequate protection to Pre-Petition Lenders and junior to Liens securing
certain intercompany advances, as provided in the Orders; and
(e) perfected first priority priming Liens, pursuant to Section
364(d)(1) of the Bankruptcy Code, on all Primed Assets;
Provided, however, that all of the claims and the Liens granted hereunder in
the Cases to the Agent and the DIP Lenders shall be subject to the Carve-Out to
the extent provided in Section 2.23.
Accordingly, the parties hereto hereby agree as follows:
ARTICLE 1
DEFINITIONS
SECTION 1.01. Defined Terms.
As used in this Agreement, the following terms shall have the meanings
specified below:
"ABR BORROWING" shall mean a Borrowing comprised of ABR Loans.
"ABR LOAN" shall mean any Loan bearing interest at a rate determined
by reference to the Alternate Base Rate in accordance with the provisions of
Section 2.
"ADDITIONAL CREDIT" shall have the meaning given such term in Section
4.02(d).
2
"ADJUSTED EBITDA" shall mean, for any period, all as determined
without duplication, the aggregate net income (or net loss) of the Low Leverage
Guarantors for such period, plus (a) the sum of (i) depreciation expense, (ii)
amortization expense, (iii) other non-cash expenses and charges, (iv) net total
Federal, state and local income tax expense, (v) gross interest expense for
such period less gross interest income for such period, (vi) extraordinary
losses and losses arising from sales of assets outside the ordinary course of
business, (vii) any non-recurring charge or restructuring charge, (viii) the
cumulative net effect (whether positive or negative) of any change in
accounting principles, (ix) "chapter 11 expenses" (or "administrative costs
reflecting chapter 11 expenses") and (x) allocated overhead and restructuring
expense less (b) extraordinary gains and gains arising from sales of assets
outside the ordinary course of business, in each case to the extent deducted in
determining the aggregate net income (or net loss) of the Low Leverage
Guarantors for such period provided that "Adjusted EBITDA" shall only include
the net income for such period of any Person that is not a Subsidiary of the
Borrower to the extent of dividends or distributions or other payments paid in
cash to the Borrower or any of the Low Leverage Guarantors.
"ADJUSTED LIBOR RATE" shall mean, with respect to any Eurodollar
Borrowing for any Interest Period, an interest rate per annum (rounded upwards,
if necessary, to the next 1/16 of 1%) equal to the quotient of (a) the LIBOR
Rate in effect for such Interest Period divided by (b) a percentage (expressed
as a decimal) equal to 100% minus Statutory Reserves. For purposes hereof, the
term "LIBOR RATe" shall mean the rate (rounded upwards, if necessary, to the
next 1/100 of 1%) appearing on Telerate Page 3750 (or any successor page) as
the London interbank offered rate for deposits in U.S. dollars at 11:00 A.M.
(London time) two Business Days before the first day of such Interest Period
for a period equal to such Interest Period (provided that, if for any reason
such rate is not available, the term "Eurodollar Rate" shall mean, for any
Interest Period such Eurodollar Borrowing, the rate per annum (rounded upwards,
if necessary, to the nearest 1/100 of 1%) appearing on Reuters Screen LIBO Page
as the London interbank offered rate for deposits in Dollars at approximately
11:00 A.M. (London time) two Business Days prior to the first day of such
Interest Period for a term comparable to such Interest Period; provided,
however, if more than one rate is specified on Reuters Screen LIBO Page, the
applicable rate shall be the arithmetic mean of all such rates.
"AFFILIATE" shall mean, as to any Person, any other Person that,
directly or indirectly, is in control of, is controlled by, or is under common
control with, such Person. For purposes of this definition, a Person (a
"CONTROLLED PERSON") shall be deemed to be "controlled by" another Person (a
"CONTROLLING PERSON") if the Controlling Person possesses, directly or
indirectly, power to direct or cause the direction of the management and
policies of the Controlled Person whether by contract or otherwise.
"AGENT" shall have the meaning set forth in the Introduction.
3
"AGREEMENT" shall mean this Revolving Credit and Guaranty Agreement,
as the same may from time to time be further amended, modified or supplemented.
"ALTERNATE BASE RATE" shall mean, for any day, a rate per annum
(rounded upwards, if necessary, to the next 1/16 of 1%) equal to the greatest
of (a) the Prime Rate in effect on such day and (b) the Federal Funds Effective
Rate in effect on such day plus 1/2of 1%. For purposes hereof, "PRIME RATE"
shall mean the rate of interest per annum publicly announced from time to time
by Citibank, N.A. as its base commercial lending rate in effect at its
principal office in New York City; each change in the Prime Rate shall be
effective on the date such change is publicly announced. "FEDERAL FUNDS
EFFECTIVE RATE" shall mean, for any day, the weighted average of the rates on
overnight Federal funds transactions with members of the Federal Reserve System
arranged by Federal funds brokers, as published on the next succeeding Business
Day by the Federal Reserve Bank of New York, or, if such rate is not so
published for any day which is a Business Day, the average of the quotations
for the day of such transactions received by the Agent from three Federal funds
brokers of recognized standing selected by it. If for any reason the Agent
shall have determined (which determination shall be conclusive absent manifest
error) that it is unable to ascertain the Federal Funds Effective Rate for any
reason, including the inability or failure of the Agent to obtain sufficient
quotations in accordance with the terms hereof, the Alternate Base Rate shall
be determined without regard to clause (b) of the first sentence of this
definition until the circumstances giving the rise to such inability no longer
exist. Any change in the Alternate Base Rate due to a change in the Prime Rate
or the Federal Funds Effective Rate shall be effective on the effective date of
such change in the Prime Rate or the Federal Funds Effective Rate,
respectively.
"ASSET SALE AGREEMENT" shall mean any agreement with respect to the
sale, lease or other disposition of any asset of the Borrower or the Guarantors
that is (a) approved by the Required DIP Lenders and (b) to the extent required
by the Bankruptcy Code, approved by the Bankruptcy Court.
"ASSIGNMENT AND ACCEPTANCE" shall mean an assignment and acceptance
entered into by a DIP Lender and an Eligible Assignee, and accepted by the
Agent and each Fronting Bank, substantially in the form of Exhibit A.
"ATTRIBUTED DIP AMOUNT" shall mean, with respect to each Low Leverage
Hotel Property, the amount set forth opposite such Low Leverage Hotel Property
in Schedule 3.15 under the heading "Attributed DIP Amount", which amount equals
the initial aggregate amount of the Commitments multiplied by the Attributed
DIP Percentage for such Low Leverage Hotel Property.
"ATTRIBUTED DIP PERCENTAGE" shall mean, with respect to each Low
Leverage Hotel Property, the percentage set forth opposite such property in
Schedule 3.15 under the heading "Proportional EBITDA".
4
"AVAILABLE COMMITMENT" shall mean (i) until the date of the Final
Order, $10,000,000 and (ii) from and after the date of the Final Order (x) the
Total Commitment less (y) the sum of (i) Attributed DIP Amount of each Low
Leverage Hotel Property that is not a Primed Hotel Property plus (ii) the
aggregate amount of loans and advances made to High Leverage Guarantors in
reliance on Section 6.10(vi) that are outstanding on any date that is after the
date of the Final Order and do not have Section 506(c) Status.
"BANKRUPTCY CODE" shall mean The Bankruptcy Reform Act of 1978, as
heretofore and hereafter amended, and codified as 11 U.S.C.ss.101, et seq.
"BANKRUPTCY COURT" shall mean the United States Bankruptcy Court for
the Southern District of New York or any other court having jurisdiction over
the Cases from time to time.
"BOARD" shall mean the Board of Governors of the Federal Reserve
System of the United States.
"BORROWER" shall have the meaning set forth on the first page of this
Agreement.
"BORROWING" shall mean the incurrence of Loans of a single Type made
by the DIP Lenders on a single date and having, in the case of Eurodollar
Loans, a single Interest Period (with any ABR Loan made pursuant to Section
2.16 being considered a part of the related Borrowing of Eurodollar Loans).
"BUDGET" shall have the meaning set forth in Section 4.01(i).
"BUSINESS DAY" shall mean any day other than a Saturday, Sunday or
other day on which banks in the State of New York are required or permitted to
close (and, for a Letter of Credit, other than a day on which the Fronting Bank
issuing such Letter of Credit is closed); provided, however, that when used in
connection with a Eurodollar Loan, the term "Business Day" shall also exclude
any day on which banks are not open for dealings in dollar deposits on the
London interbank market.
"CAPITAL EXPENDITURES" shall mean, for any period, the aggregate of
all expenditures paid in cash by the Borrower and the Guarantors during such
period that, in conformity with GAAP, are required to be included in or
reflected by the property, plant, equipment or intangibles or similar fixed
asset accounts reflected in the consolidated balance sheet of the Borrower and
the Guarantors (including equipment purchased simultaneously with the trade-in
of existing equipment owned by the Borrower or any of the Guarantors to the
extent of the gross amount of such purchase price less the book value of the
equipment being traded in at such time).
5
"CAPITALIZED LEASE" shall mean, as applied to any Person, any lease of
property by such Person as lessee that would be capitalized on a balance sheet
of such Person prepared in accordance with GAAP.
"CAPITAL STOCK" shall mean, any and all shares, interests,
participations or other equivalents (however designated) of capital stock of a
corporation, any and all equivalent ownership interests in a Person (other than
a corporation) and any and all warrants or options to purchase any of the
foregoing.
"CARVE-OUT" shall have the meaning set forth in Section 2.23.
"CASES" shall mean the Cases under chapter 11 of the Bankruptcy Code
of the Borrower and certain of the Guarantors pending in the Bankruptcy Court.
"CHANGE OF CONTROL" shall mean and be deemed to have occurred upon the
occurrence of any of the following events: (i) any Person or "group" (within
the meaning of Section 13(d) or 14(d) of the Securities Exchange Act of 1934,
and regulations promulgated thereunder) shall have acquired beneficial
ownership of more than 35% of the outstanding shares of Voting Stock of the
Borrower and (ii) the board of directors of the Borrower shall cease to consist
of a majority of Continuing Directors of the Borrower. "VOTING STOCK" shall
mean shares of Capital Stock entitled to vote generally in the election of
directors, and "CONTINUING DIRECTORS" shall mean the directors of the Borrower
on the Closing Date and each other director, if, in each case, such other
director's election or nomination for election to the board of directors of the
Borrower is recommended by at least a majority of the then Continuing
Directors.
"CLOSING DATE" shall mean the date on which this Agreement has been
executed and the conditions precedent set forth in Section 4.01 have been
satisfied or waived, which date shall occur promptly upon entry of the Interim
Order, but not later than 15 days following the Petition Date. The Agent's
execution and delivery of this Agreement shall constitute notice to the
Borrowers of the satisfaction of the conditions precedent set forth in Section
4.01 and the occurrence of the Closing Date.
"CO-ARRANGERS" shall have the meaning set forth on the first page of
this Agreement.
"CODE" shall mean the Internal Revenue Code of 1986, as amended from
time to time.
"COLLATERAL" shall mean the Collateral as defined in the Security and
Pledge Agreement and all other collateral given, pursuant to orders of the
Bankruptcy Court or otherwise, as security for or in connection with the
Obligations.
6
"COMMITMENT" shall mean, with respect to each DIP Lender, the
commitment of each DIP Lender hereunder in the amount set forth opposite its
name on Annex A hereto or as may subsequently be set forth in the Register from
time to time, as the same may be reduced from time to time pursuant to this
Agreement.
"COMMITMENT FEE" shall have the meaning set forth in Section 2.20.
"COMMITMENT PERCENTAGE" shall mean at any time, with respect to each
DIP Lender, the percentage obtained by dividing its Commitment at such time by
the Total Commitment at such time.
"CONCENTRATION ACCOUNT" shall have the meaning set forth in Section
5.07.
"CONSUMMATION DATE" shall mean the date (or if there is more than one
of such dates, the first such date) of the substantial consummation (as defined
in Section 1101(2) of the Bankruptcy Code and which, for purposes of this
Agreement, shall be no later than the effective date) of a Reorganization Plan
of the Borrower or any of the Guarantors that is confirmed pursuant to an order
of the Bankruptcy Court in the Cases.
"DIP LENDER AFFILIATE" means, (a) with respect to any DIP Lender, (i)
an Affiliate of such DIP Lender or (ii) any entity (whether a corporation,
partnership, trust or otherwise) that is engaged in making, purchasing, holding
or otherwise investing in bank loans and similar extensions of credit in the
ordinary course of its business and is administered or managed by a DIP Lender
or an Affiliate of such DIP Lender and (b) with respect to any DIP Lender that
is a fund which invests in bank loans and similar extensions of credit, any
other fund that invests in bank loans and similar extensions of credit and is
managed by the same investment advisor as such DIP Lender or by an Affiliate of
such investment advisor.
"DIP LENDERS" shall have the meaning set forth on the first page of
this Agreement.
"DOLLARS" and "$" shall mean lawful money of the United States of
America.
"ELIGIBLE ASSIGNEE" shall mean (i) a commercial bank having total
assets in excess of $1,000,000,000; (ii) a finance company, insurance company
or other financial institution or fund, in each case acceptable to the Agent,
which in the ordinary course of business extends credit of the type
contemplated herein and has total assets in excess of $200,000,000 and whose
becoming an assignee would not constitute a prohibited transaction under
Section 4975 of ERISA; (iii) a DIP Lender Affiliate; and (iv) any other
financial institution satisfactory to the Borrower and the Agent.
7
"ENVIRONMENTAL LIEN" shall mean a Lien in favor of any Governmental
Authority for (i) any liability under federal or state environmental laws or
regulations or (ii) damages arising from or costs incurred by such Governmental
Authority in response to a release or threatened release of a hazardous or
toxic waste, substance or constituent, or other substance into the environment.
"ERISA" shall mean the Employee Retirement Income Security Act of
1974, as amended from time to time, and the regulations promulgated and rulings
issued thereunder.
"ERISA AFFILIATE" shall mean any trade or business (whether or not
incorporated) that is a member of a group of which the Borrower is a member and
that is under common control within the meaning of Section 414(b) or (c) of the
Code and the regulations promulgated and rulings issued thereunder.
"EUROCURRENCY LIABILITIES" shall have the meaning assigned thereto in
Regulation D issued by the Board, as in effect from time to time.
"EURODOLLAR BORROWING" shall mean a Borrowing comprised of Eurodollar
Loans.
"EURODOLLAR LOAN" shall mean any Loan bearing interest at a rate
determined by reference to the Adjusted LIBOR Rate in accordance with the
provisions of Section 2.
"EVENT OF DEFAULT" shall have the meaning set forth in Section 7.01.
"EXISTING JOINT VENTURE" shall mean each joint venture listed on
Schedule 1.01(a) hereto.
"FEES" shall collectively mean the Commitment Fees, Letter of Credit
Fees and other fees referred to in Sections 2.19, 2.20 and 2.21.
"FINAL ORDER" shall have the meaning given such term in Section
4.02(d).
"FINANCIAL OFFICER" shall mean the chief financial officer of the
Borrower.
"FRONTING BANK" shall mean MSSF or such other DIP Lender (which other
DIP Lender shall be reasonably satisfactory to the Borrower), in their
capacities as the issuer(s) of Letters of Credit hereunder, and their
respective successors in such capacity as provided for herein. A Fronting Bank
may, in its discretion, arrange for one or more Letters of Credit to be issued
by an Affiliate of such Fronting Bank, in which case the term "Fronting Bank"
shall include any such Affiliate with respect to Letters of Credit issued by
such Affiliate as may agree with MSSF to act in such capacity.
8
"GAAP" shall mean generally accepted accounting principles applied in
accordance with Section 1.02.
"GOVERNMENTAL AUTHORITY" shall mean any Federal, state, municipal or
other governmental department, commission, board, bureau, agency or
instrumentality or any court, in each case whether of the United States or
foreign.
"GUARANTOR" shall have the meaning set forth on the first page of this
Agreement.
"HIGH LEVERAGE GUARANTOR" shall mean any Guarantor that is not a Low
Leverage Guarantor.
"INDEBTEDNESS" shall mean, at any time and with respect to any Person,
(i) all indebtedness of such Person for borrowed money, (ii) all indebtedness
of such Person for the deferred purchase price of property or services (other
than property, including inventory, and services purchased, and expense
accruals and deferred compensation items, arising in the ordinary course of
business), (iii) all obligations of such Person evidenced by notes, bonds,
debentures or other similar instruments (other than performance, surety and
appeal bonds arising in the ordinary course of business), (iv) all indebtedness
of such Person created or arising under any conditional sale or other title
retention agreement with respect to property acquired by such Person (even
though the rights and remedies of the seller or lender under such agreement in
the event of default are limited to repossession or sale of such property), (v)
all obligations of such Person under Capitalized Leases, to the extent required
to be so recorded, (vi) all reimbursement, payment or similar obligations of
such Person, contingent or otherwise, under acceptance, letter of credit or
similar facilities and all obligations of such Person in respect of (x)
currency swap agreements, currency future or option contracts and other similar
agreements designed to hedge against fluctuations in foreign interest rates and
(y) interest rate swap, cap or collar agreements and interest rate future or
option contracts; (vii) all Indebtedness referred to in clauses (i) through
(vi) above guaranteed directly or indirectly by such Person, or in effect
guaranteed directly or indirectly by such Person through an agreement (A) to
pay or purchase such Indebtedness or to advance or supply funds for the payment
or purchase of such Indebtedness, (B) to purchase, sell or lease (as lessee or
lessor) property, or to purchase or sell services, primarily for the purpose of
enabling the debtor to make payment of such Indebtedness or to assure the
holder of such Indebtedness against loss in respect of such Indebtedness, (C)
to supply funds to or in any other manner invest in the debtor (including any
agreement to pay for property or services irrespective of whether such property
is received or such services are rendered) or (D) otherwise to assure a
creditor against loss in respect of such Indebtedness, and (viii) all
Indebtedness referred to in clauses (i) through (vii) above secured by (or for
which the holder of such Indebtedness has an existing right, contingent or
otherwise, to be secured by) any Lien upon or in property (including, without
limitation, accounts and contract rights) owned by such Person, even though
such Person has not assumed or become liable for the payment of such
Indebtedness.
9
"INSUFFICIENCY" shall mean, with respect to any Plan, the amount, if
any, of its unfunded benefit liabilities within the meaning of Section
4001(a)(18) of ERISA.
"INTERIM ORDER" shall have the meaning given such term in Section
4.01(b).
"INTEREST PAYMENT DATE" shall mean (i) as to any Eurodollar Loan, the
last day of each consecutive 30 day period running from the commencement of the
applicable Interest Period, and (ii) as to all ABR Loans, the last calendar day
of each month.
"INTEREST PERIOD" shall mean, as to any Borrowing of Eurodollar Loans,
the period commencing on the date of such Borrowing (including as a result of a
refinancing of ABR Loans) or on the last day of the preceding Interest Period
applicable to such Borrowing and ending on the numerically corresponding day
(or if there is no corresponding day, the last day) in the calendar month that
is one or three months thereafter, as the Borrower may elect in the related
notice delivered pursuant to Sections 2.06(b) or 2.12; provided, however, that
(i) if any Interest Period would end on a day which shall not be a Business
Day, such Interest Period shall be extended to the next succeeding Business Day
unless such next succeeding Business Day would fall in the next calendar month,
in which case such Interest Period shall end on the immediately preceding
Business Day, and (ii) no Interest Period shall end later than the Termination
Date.
"INVESTMENTS" shall have the meaning given such term in Section 6.10.
"LETTER OF CREDIT" shall mean any irrevocable letter of credit issued
pursuant to Section 2.03, which letter of credit shall, subject to Section
3.13, be (i) a standby or import documentary letter of credit, (ii) issued for
purposes that are consistent with the ordinary course of business of the
Borrower or any Subsidiary, or for such other purposes as are reasonably
acceptable to the Agent, (iii) denominated in Dollars and (iv) otherwise in
such form as may be reasonably approved from time to time by the Agent and the
applicable Fronting Bank.
"LETTER OF CREDIT ACCOUNT" shall mean the account established by the
Borrower under the sole and exclusive control of the Agent designated as the
"Lodgian, Inc." and used solely for the purposes set forth in Sections 2.03(b)
and 2.13.
"LETTER OF CREDIT FEES" shall mean the fees payable in respect of
Letters of Credit pursuant to Section 2.21.
"LETTER OF CREDIT OUTSTANDINGS" shall mean, at any time, the sum of
(i) the aggregate undrawn stated amount of all Letters of Credit then
outstanding plus (ii) all amounts theretofore drawn under Letters of Credit and
not then reimbursed.
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"LIEN" shall mean any mortgage, pledge, security interest,
encumbrance, lien or charge of any kind whatsoever (including any conditional
sale or other title retention agreement or any lease in the nature thereof).
"LOAN" shall have the meaning given such term in Section 2.01.
"LOAN DOCUMENTS" shall mean this Agreement, the Letters of Credit, the
Security and Pledge Agreement and any other instrument or agreement executed
and delivered in connection herewith.
"LOW LEVERAGE GUARANTOR" shall mean each Guarantor that owns a Low
Leverage Hotel Property or that is a holding company (i.e., does not own any
hotel property directly but only investments in subsidiaries) that owns capital
stock or Indebtedness of any such Guarantor that is a Low Leverage Guarantor.
"LOW LEVERAGE HOTEL PROPERTY" shall mean each hotel property
identified as a "Low Leverage Hotel Property" on Schedule 3.15.
"MATURITY DATE" shall mean the first anniversary of the Petition Date.
"MULTIEMPLOYER PLAN" shall mean a "multiemployer plan" as defined in
Section 4001(a)(3) of ERISA to which the Borrower or any ERISA Affiliate is
making or accruing an obligation to make contributions, or has within any of
the preceding five plan years made or accrued an obligation to make
contributions.
"MULTIPLE EMPLOYER PLAN" shall mean a Single Employer Plan, that (i)
is maintained for employees of the Borrower or an ERISA Affiliate and at least
one Person other than the Borrower and its ERISA Affiliates or (ii) was so
maintained and in respect of which the Borrower or an ERISA Affiliate could
have liability under Section 4064 or 4069 of ERISA in the event such Plan has
been or were to be terminated.
"NET PROCEEDS" shall mean, in respect of any sale or other disposition
of assets, the proceeds of such sale or disposition after the payment of or
reservation for (a) expenses that are directly related to (or the need for
which arises as a result of) the transaction of such sale or disposition,
including, but not limited to, related severance costs, taxes payable,
brokerage commissions, professional expenses, other similar costs that are
directly related to the sale or disposition, (b) escrow and indemnification
amounts required under the terms of such sale or other disposition and (c) the
amount secured by valid and perfected Liens, if any, that are senior to the
Liens on such assets held by the Agent on behalf of the DIP Lenders.
"OBLIGATIONS" shall mean all obligations, now or hereafter existing,
under this Agreement and the other Loan Documents, including, but not limited
to, (a) the due and
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punctual payment of all principal of and interest on the Loans and the
reimbursement of all amounts drawn under Letters of Credit, (b) the due and
punctual payment of the Fees and all other present and future, fixed or
contingent, obligations of the Borrower and the Guarantors to the DIP Lenders
and the Agent under the Loan Documents (including in connection with
Indebtedness permitted under Section 6.03(a)(iv) hereof and arising subsequent
to the Petition Date) and (c) any amendments, restatements, renewals,
extensions or modifications of any of the foregoing.
"ORDERS" shall mean (i) the Interim Order and the Final Order of the
Bankruptcy Court referred to in Sections 4.01(b) and 4.02(d) and (ii) any cash
management orders or cash collateral orders entered in the Cases with the
approval of the Co-Arrangers.
"OTHER TAXES" shall have the meaning given such term in Section 2.18.
"PBGC" shall mean the Pension Benefit Guaranty Corporation, or any
successor agency or entity performing substantially the same functions.
"PERMITTED INVESTMENTS" shall mean:
(a) direct obligations of, or obligations the principal of and
interest on which are unconditionally guaranteed by, the United States of
America (or by any agency thereof to the extent such obligations are backed by
the full faith and credit of the United States of America), in each case
maturing within twelve months from the date of acquisition thereof;
(b) without limiting the provisions of paragraph (d) below,
investments in commercial paper maturing within six months from the date of
acquisition thereof and having, at such date of acquisition, a rating of at
least "A-2" or the equivalent thereof from Standard & Poor's Corporation or of
at least "P-2" or the equivalent thereof from Moody's Investors Service, Inc.;
(c) investments in certificates of deposit, banker's acceptances
and time deposits (including Eurodollar time deposits) maturing within six
months from the date of acquisition thereof issued or guaranteed by or placed
with (i) any domestic office of the Agent or the bank with whom the Borrower
and the Guarantors maintain their cash management system, provided, that if
such bank is not a DIP Lender hereunder, such bank shall have entered into an
agreement with the Agent pursuant to which such bank shall have waived all
rights of setoff and confirmed that such bank does not have, nor shall it
claim, a security interest therein or (ii) any domestic office of any other
commercial bank of recognized standing organized under the laws of the United
States of America or any State thereof that has a combined capital and surplus
and undivided profits of not less than $250,000,000 and is the principal
banking subsidiary of a bank holding company having a long-term unsecured debt
rating of at least "A-2" or the.
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equivalent thereof from Standard & Poor's Corporation or at least "P-2" or the
equivalent thereof from Moody's Investors Service, Inc.;
(d) investments in commercial paper maturing within six months
from the date of acquisition thereof and issued by (i) the holding company of
the Agent or (ii) the holding company of any other commercial bank of
recognized standing organized under the laws of the United States of America or
any State thereof that has (A) a combined capital and surplus in excess of
$250,000,000 and (B) commercial paper rated at least "A-2" or the equivalent
thereof from Standard & Poor's Corporation or at least "P-2" or the equivalent
thereof from Moody's Investors Service, Inc.;
(e) investments in repurchase obligations with a term of not more
than seven days for underlying securities of the types described in clause (a)
above entered into with any office of a bank or trust company meeting the
qualifications specified in clause (c) above;
(f) investments in money market funds substantially all the
assets of which are comprised of securities of the types described in clauses
(a) through (e) above; and
(g) to the extent owned on the Petition Date, investments in the
capital stock of any direct or indirect Subsidiary of the Borrower.
"PERMITTED LIENS" shall mean (i) Liens imposed by law (other than
Environmental Liens and any Lien imposed under ERISA) for taxes, assessments or
charges of any Governmental Authority for claims not yet due or that are being
contested in good faith by appropriate proceedings and with respect to which
adequate reserves or other appropriate provisions are being maintained in
accordance with GAAP; (ii) statutory Liens of landlords and Liens of carriers,
warehousemen, mechanics, materialmen and other Liens (other than Environmental
Liens and any Lien imposed under ERISA) in existence on the Petition Date or
thereafter imposed by law and created in the ordinary course of business; (iii)
Liens (other than any Lien imposed under ERISA) incurred or deposits made in
the ordinary course of business (including, without limitation, surety bonds
and appeal bonds) in connection with workers' compensation, unemployment
insurance and other types of social security benefits or to secure the
performance of tenders, bids, leases, contracts (other than for the repayment
of Indebtedness), statutory obligations and other similar obligations incurred
in the ordinary course of business or arising as a result of progress payments
under government contracts; (iv) easements (including, without limitation,
reciprocal easement agreements and utility agreements), rights-of-way,
covenants, consents, reservations, encroachments, variations and zoning and
other restrictions, charges or encumbrances (whether or not recorded) and
interest of ground lessors, that do not interfere in any material respect with
the ordinary conduct of the business of the Borrower or any Guarantor, as the
case may be, and that do not detract in any material respect from the value of
the property to which they attach or materially impair the use thereof to the
Borrower or any Guarantor, as the
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case may be and (v) extensions, renewals or replacements of any Lien referred
to in paragraphs (i) through (iv) above, provided that the principal amount of
the obligation secured thereby is not increased and that any such extension,
renewal or replacement is limited to the property originally encumbered
thereby; and provided further that the term "PERMITTED LIENS", when used with
respect to any Collateral subject to a mortgage, shall mean the "Permitted
Liens" or "Permitted Encumbrances" as defined in such mortgage only.
"PERSON" shall mean any natural person, corporation, division of a
corporation, partnership, trust, joint venture, association, company, estate,
unincorporated organization or government or any agency or political
subdivision thereof.
"PETITION DATE" shall have the meaning given such term in the
Introductory Statement on the first page of this Agreement.
"PLAN" shall mean a single Employer Plan or a Multiemployer Plan.
"PREPAYMENT DATE" shall mean thirty (30) days after the entry of the
Interim Order by the Bankruptcy Court if the Final Order has not been entered
by the Bankruptcy Court prior to the expiration of such thirty (30) day period.
"PRE-PETITION AGENT" shall mean MSSF as agent for the Pre-Petition
Lenders.
"PRE-PETITION CREDIT AGREEMENT" shall mean the Credit Agreement dated
as of July 23, 1999, among Lodgian Financing Corp., the Borrower, Impac Hotel
Group, LLC, Servico Inc., the Affiliate Guarantors party thereto, MSSF, as
Administrative Agent, Collateral Agent, Co-Lead Arranger, Joint-Book Manager
and Syndication Agent, Lehman Brothers Inc., as Co-Lead Arranger and Joint Book
Manager and Lehman Commercial Paper Inc., as Documentation Agent and the
several lenders from time to time party thereto and shall include all of the
agreements granting security interests and Liens in property and assets of the
Borrower and the Guarantors to the Pre-Petition Lenders, including without
limitation, security agreements, mortgages and leasehold mortgages, each of
which documents was executed and delivered (to the extent party thereto) by the
Borrower and the Guarantors prior to the Petition Date, as each may have been
amended or modified from time to time.
"PRE-PETITION INDEBTEDNESS" shall mean all Indebtedness of the
Borrower and its Subsidiaries outstanding on the Petition Date.
"PRE-PETITION LENDERS" shall mean, collectively, those certain lenders
to the Borrower and the Guarantors (to the extent party thereto) under the
Pre-Petition Credit Agreement, together with any successors or assigns thereof.
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"PRE-PETITION PAYMENT" shall mean a payment (by way of adequate
protection or otherwise) of principal or interest or otherwise on account of
any pre-petition Indebtedness of, or trade payables of, or other pre-petition
claims against, the Borrower or any Guarantor that is the subject of a Case.
"PRIMED ASSET" shall mean any Specified Asset; provided that the
Bankruptcy Court has authorized pursuant to Section 364(d)(i) of the Bankruptcy
Code that the Obligations under the Loan Documents be secured by a perfected
first priority senior priming Lien on such Specified Asset.
"PRIMED HOTEL PROPERTY" shall mean, at any time, any Low Leverage
Hotel Property that is a Primed Asset.
"PRIMED LENDER" shall mean the Pre-Petition Lenders and each other
creditor that is owed Pre-Petition Indebtedness by a Low Leverage Guarantor
that is secured by a valid Lien that existed prior to the Petition Date on a
Primed Hotel Property.
"REDUCTION PERCENTAGE" shall mean (i) with respect to any hotel
property other than a Primed Hotel Property, 100% and (ii) with respect to any
Primed Hotel Property, the fraction (expressed as a percentage, but not more
than 100%) the numerator of which is the Attributed DIP Amount of such Primed
Hotel Property and the denominator of which is the Net Cash Proceeds of such
Primed Hotel Property.
"REGISTER" shall have the meaning set forth in section 10.03(d).
"REORGANIZATION PLAN" shall mean a plan of reorganization in any of
the Cases.
"REQUIRED DIP LENDERS" shall mean, at any time, DIP Lenders holding
Loans representing in excess of 50% of the aggregate principal amount of such
Loans outstanding or, if no such Loans are outstanding, DIP Lenders having
Commitments representing in excess of 50% of the Total Commitment.
"SCHEDULED PERCENTAGE" shall mean, with respect to any Primed Lender
(or any DIP Lender that acquired a Commitment, directly or indirectly, from a
Primed Lender), the aggregate of the Attributable DIP Percentages of all Primed
Hotel Properties securing such Primed Lender's Pre-Petition Indebtedness.
"SECURITY AND PLEDGE AGREEMENT" shall have the meaning set forth in
Section 4.01(c).
"SECTION 506(C) STATUS" shall have the meaning specified in Section
6.10(vi).
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"SINGLE EMPLOYER PLAN" shall mean a single employer plan, as defined
in Section 4001(a)(15) of ERISA, that (i) is maintained for employees of the
Borrower or an ERISA Affiliate or (ii) was so maintained and in respect of
which the Borrower could have liability under Section 4069 of ERISA in the
event such Plan has been or were to be terminated.
"SPECIFIED ASSETS" shall mean all property of the Borrower and each
Low Leverage Guarantor, including without limitation all real property,
accounts receivable, rents, contracts, documents, inventory, equipment, general
intangibles, instruments, interests in leaseholds, intellectual property,
rights under license agreements and the Capital Stock of all Subsidiaries of
the Borrower that are Low Leverage Guarantors.
"STATUTORY RESERVES" shall mean on any date the percentage (expressed
as a decimal) established by the Board and any other banking authority that is
the then stated maximum rate for all reserves (including but not limited to any
emergency, supplemental or other marginal reserve requirements) applicable to
any member bank of the Federal Reserve System in respect of Eurocurrency
Liabilities (or any successor category of liabilities under Regulation D issued
by the Board, as in effect from time to time). Such reserve percentages shall
include, without limitation, those imposed pursuant to said Regulation. The
Statutory Reserves shall be adjusted automatically on and as of the effective
date of any change in such percentage.
"SUBSIDIARY" means, with respect to any Person (herein referred to as
the "PARENT"), a corporation, partnership, limited liability company or other
entity (whether now existing or hereafter organized) of which shares of stock
or other ownership interest having ordinary voting power (other than stock or
such other ownership interests having such power only by reason of the
happening of a contingency) to elect a majority of the board of directors or
other managers of such corporation, partnership, limited liability company or
other entity are at the time owned, or the management of which is otherwise
controlled, directly or indirectly through one or more intermediaries, or both,
by the parent, provided, however, that for all purposes of the Loan Documents,
an Existing Joint Venture shall be deemed to be a Subsidiary. Unless otherwise
qualified, all references to a "Subsidiary" or to "Subsidiaries" in this
Agreement shall refer to a Subsidiary or Subsidiaries of the Borrower.
"SUPER-MAJORITY DIP LENDERS" shall have the meaning given such term in
Section 10.10(b).
"SUPERPRIORITY CLAIM" shall mean a claim against the Borrower or any
Guarantor in any of the Cases that is a superpriority administrative expense
claim having priority over any or all administrative expenses and other claims
of the kind specified in, or otherwise arising or ordered under, any Sections
of the Bankruptcy Code (including, without limitation, Sections 105, 326, 328,
330, 331, 503(b), 507(a), 507(b), 546(c)
16
and/or 726 thereof), whether or not such claim or expenses may become secured
by a judgment lien or other non-consensual lien, levy or attachment.
"TAXES" shall have the meaning given such term in section 2.18.
"TERMINATION DATE" shall mean the earliest to occur of (i) the
Prepayment Date, (ii) the Maturity Date, (iii) the Consummation Date and (iv)
the acceleration of the Loans and the termination of the Total Commitment in
accordance with the terms hereof.
"TERMINATION EVENT" shall mean (i) a "reportable event", as such term
is described in Section 4043 of ERISA and the regulations issued thereunder
(other than a "reportable event" not subject to the provision for 30-day notice
to the PBGC under Section 4043 of ERISA or such regulations) or an event
described in Section 4068 of ERISA excluding events described in Section
4043(c)(9) of ERISA or 29 CFRss.ss.2615.21 or 2615.23, or (ii) the withdrawal
of the Borrower or any ERISA Affiliate from a Multiple Employer Plan during a
plan year in which it was a "substantial employer", as such term is defined in
Section 4001(c) of ERISA, or the incurrence of liability by the Borrower or any
ERISA Affiliate under Section 4064 of ERISA upon the termination of a Multiple
Employer Plan, or (iii) providing notice of intent to terminate a Plan pursuant
to Section 4041(c) of ERISA or the treatment of a Plan amendment as a
termination under Section 4041 of ERISA, or (iv) the institution of proceedings
to terminate a Plan by the PBGC under Section 4042 of ERISA or (v) any other
event or condition (other than the commencement of the Cases and the failure to
have made any contribution accrued as of the Petition Date but not paid) that
would reasonably be expected to constitute grounds under Section 4042 of ERISA
for the termination of, or the appointment of a trustee to administer, any
Plan, or the imposition of any liability under Title IV of ERISA (other than
for the payment of premiums to the PBGC).
"TOTAL COMMITMENT" shall mean, at any time, the sum of the Commitments
at such time.
"TRANSFEREE" shall have the meaning given such term in Section 2.18.
"TYPE" when used in respect of any Loan or Borrowing shall refer to
the Rate of interest by reference to which interest on such Loan or on the
Loans comprising such Borrowing is determined. For purposes hereof, "RATE"
shall mean the Adjusted LIBOR Rate and the Alternate Base Rate.
"UNUSED TOTAL COMMITMENT" shall mean, at any time, (i) the Total
Commitment less (ii) the sum of (x) the aggregate outstanding principal amount
of all Loans and (y) the aggregate Letter of Credit Outstandings.
"WITHDRAWAL LIABILITY" shall have the meaning given such term under
Part I of Subtitle E of Title IV of ERISA.
17
SECTION 1.02. Terms Generally. The definitions in Section 1.01 shall
apply equally to both the singular and plural forms of the terms defined.
Whenever the context may require, any pronoun shall include the corresponding
masculine, feminine and neuter forms. All references herein to Sections,
Exhibits and Schedules shall be deemed references to Sections of, and Exhibits
and Schedules to, this Agreement unless the context shall otherwise require.
Except as otherwise expressly provided herein, all terms of an accounting or
financial nature shall be construed in accordance with GAAP, as in effect from
time to time; provided, however, that for purposes of determining compliance
with any covenant set forth in Section 6, such terms shall be construed in
accordance with GAAP as in effect on the date of this Agreement applied on a
basis consistent with the application used in the Borrower's audited financial
statements referred to in Section 3.04.
ARTICLE 2
AMOUNT AND TERMS OF CREDIT
SECTION 2.01. Commitment of the DIP Lenders.
(a) Each DIP Lender severally and not jointly with the other DIP
Lenders agrees, upon the terms and subject to the conditions herein set forth
(including, without limitation, the provisions of Section 2.02 and Section
2.28), to make revolving credit loans (each a "LOAN" and collectively, the
"LOANS") to the Borrower at any time and from time to time during the period
commencing on the date hereof and ending on the Termination Date in an
aggregate principal amount not to exceed, when added to such DIP Lender's
Commitment Percentage of the then aggregate Letter of Credit Outstandings (in
excess of the amount of cash then held in the Letter of Credit Account pursuant
to Section 2.03(b)), the Commitment of such DIP Lender, which Loans may be
repaid and reborrowed in accordance with the provisions of this Agreement.
(b) Each Borrowing shall be funded by the DIP Lenders pro rata in
accordance with their respective Commitments; provided, however, that the
failure of any DIP Lender to make any Loan shall not in itself relieve the
other DIP Lenders of their obligations to lend.
SECTION 2.02. Availability of Commitment. At no time shall the sum of
the then outstanding aggregate principal amount of the Loans plus the then
aggregate Letter of Credit Outstandings (in excess of the amount of cash then
held in the Letter of Credit Account pursuant to Section 2.03(b)) exceed the
lesser of (i) the Available Commitment and (ii) the Total Commitment, and no
Loan shall be made or Letter of Credit issued in violation of the foregoing.
SECTION 2.03. Letters of Credit.
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(a) Upon the terms and subject to the conditions herein set
forth, the Borrower may request a Fronting Bank, at any time and from time to
time after the date hereof and prior to the Termination Date, to issue, and
subject to the terms and conditions contained herein, such Fronting Bank shall
issue, for the account of the Borrower or a Guarantor one or more Letters of
Credit in support of obligations of the Borrower or such Guarantor that are
acceptable to the Agent in its sole discretion; provided that no Letter of
Credit shall be issued if after giving effect to such issuance (i) the
aggregate Letter of Credit Outstandings shall exceed $5,000,000 or (ii) the
aggregate Letter of Credit Outstandings, when added to the aggregate
outstanding principal amount of the Loans, would exceed the lesser of (x) the
Total Commitment and (y) the Available Commitment; and provided further that no
Letter of Credit shall be issued if the Fronting Bank shall have received
notice from the Agent or the Required DIP Lenders that the conditions to such
issuance have not been met.
(b) No Letter of Credit shall expire later than the Maturity
Date, provided that if any Letter of Credit shall be outstanding on the
Termination Date, the Borrower shall, at or prior to the Termination Date,
except as the Agent may otherwise agree in writing, (i) cause all Letters of
Credit that expire after the Termination Date to be returned to the Fronting
Bank undrawn and marked "cancelled" or (ii) if the Borrower is unable to do so
in whole or in part, either (x) provide a "back-to-back" letter of credit to
one or more Fronting Banks in a form satisfactory to such Fronting Bank and the
Agent (in their sole discretion), issued by a bank satisfactory to such
Fronting Bank and the Agent (in their sole discretion), in an amount equal to
the greater of (I) an amount, as determined by the Fronting Bank and the Agent,
equal to the face amount of all outstanding Letters of Credit plus the sum of
all projected contractual obligations to the Agent, the Fronting Bank and the
DIP Lenders of the Borrower or Guarantor thereunder through the expiration
date(s) of such Letters of Credit, and (II) 105% of the then undrawn stated
amount of all outstanding Letters of Credit issued by such Fronting Banks
and/or (y) deposit cash in the Letter of Credit Account in an amount equal to
the greater of (I) an amount, as determined by the Fronting Bank and the Agent,
equal to the face amount of all outstanding Letters of Credit plus the sum of
all projected contractual obligations to the Agent, the Fronting Bank and the
DIP Lenders of the Borrower or Guarantor thereunder and (II) 105% of the then
undrawn stated amount of all outstanding Letters of Credit as collateral
security for the Borrower's reimbursement obligations in connection therewith,
such cash to be remitted to the Borrower upon the expiration, cancellation or
other termination or satisfaction of such reimbursement obligations.
(c) The Borrower shall pay to each Fronting Bank, in addition to
such other fees and charges as are specifically provided for in Section 2.21
hereof, such fees and charges in connection with the issuance and processing of
the Letter of Credit issued by such Fronting Bank as are customarily imposed by
such Fronting Bank from time to time in connection with letter of credit
transactions.
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(d) Drafts drawn under each Letter of Credit shall be reimbursed
by the Borrower in Dollars not later than the first Business Day following the
date of draw and shall bear interest from the date of draw until the first
Business Day following the date of draw at a rate per annum equal to the
Alternate Base Rate plus 2.50% and thereafter until reimbursed in full at a
rate per annum equal to the Alternate Base Rate plus 4.50% (computed on the
basis of the actual number of days elapsed over a year of 360 days). The
Borrower shall effect such reimbursement (x) if such draw occurs prior to the
Termination Date (or the earlier date of termination of the Total Commitment),
in cash or through a Borrowing without the satisfaction of the conditions
precedent set forth in Section 4.02 or (y) if such draw occurs on or after the
Termination Date (or the earlier date of termination of the Total Commitment),
in cash. Each DIP Lender agrees to make the Loans described in clause (x) of
the preceding sentence notwithstanding a failure to satisfy the applicable
lending conditions thereto or the provisions of Sections 2.02 or 2.28.
(e) Immediately upon the issuance of any Letter of Credit by any
Fronting Bank, such Fronting Bank shall be deemed to have sold to each DIP
Lender other than such Fronting Bank and each such other DIP Lender shall be
deemed unconditionally and irrevocably to have purchased from such Fronting
Bank, without recourse or warranty, an undivided interest and participation, to
the extent of such DIP Lender's Commitment Percentage, in such Letter of
Credit, each drawing thereunder and the obligations of the Borrower and the
Guarantors under this Agreement with respect thereto. Upon any change in the
Commitments pursuant to Section 10.03, it is hereby agreed that with respect to
all Letter of Credit Outstandings, there shall be an automatic adjustment to
the participations hereby created to reflect the new Commitment Percentages of
the assigning and assignee DIP Lenders. Any action taken or omitted by a
Fronting Bank under or in connection with a Letter of Credit, if taken or
omitted in the absence of gross negligence or willful misconduct, shall not
create for such Fronting Bank any resulting liability to any other DIP Lender.
(f) In the event that a Fronting Bank makes any payment under any
Letter of Credit and the Borrower shall not have reimbursed such amount in full
to such Fronting Bank pursuant to this Section, the Fronting Bank shall
promptly notify the Agent, which shall promptly notify each DIP Lender of such
failure, and each DIP Lender shall promptly and unconditionally pay to the
Agent for the account of the Fronting Bank the amount of such DIP Lender's
Commitment Percentage of such unreimbursed payment in Dollars and in same day
funds. If the Fronting Bank so notifies the Agent, and the Agent so notifies
the DIP Lenders prior to 11:00 a.m. (New York City time) on any Business Day,
each of such DIP Lenders shall make available to the Fronting Bank such DIP
Lender's Commitment Percentage of the amount of such payment on such Business
Day in same day funds. If and to the extent such DIP Lender shall not have so
made its Commitment Percentage of the amount of such payment available to the
Fronting Bank, such DIP Lender agrees to pay to such Fronting Bank, forthwith
on demand such amount, together with interest thereon, for each day from such
date until the date such amount is
20
paid to the Agent for the account of such Fronting Bank at the Federal Funds
Effective Rate. The failure of any DIP Lender to make available to the Fronting
Bank its Commitment Percentage of any payment under any Letter of Credit shall
not relieve any other DIP Lender of its obligation hereunder to make available
to the Fronting Bank its Commitment Percentage of any payment under any Letter
of Credit on the date required, as specified above, but no DIP Lender shall be
responsible for the failure of any other DIP Lender to make available to such
Fronting Bank such other DIP Lender's Commitment Percentage of any such
payment. Whenever a Fronting Bank receives a payment of a reimbursement
obligation as to which it has received any payments from the DIP Lenders
pursuant to this paragraph, such Fronting Bank shall pay to each DIP Lender
which has paid its Commitment Percentage thereof, in Dollars and in same day
funds, an amount equal to such DIP Lender's Commitment Percentage thereof.
SECTION 2.04. Issuance. Whenever the Borrower desires a Fronting Bank
to issue a Letter of Credit, it shall give to such Fronting Bank and the Agent
at least two Business Days' prior written (including telegraphic, telex,
facsimile or cable communication) notice (or such shorter period as may be
agreed upon by the Agent, the Borrower and the Fronting Bank) specifying the
date on which the proposed Letter of Credit is to be issued (which shall be a
Business Day), the stated amount of the Letter of Credit so requested, the
conditions for the drawing thereof, the expiration date of such Letter of
Credit and the name and address of the beneficiary thereof.
SECTION 2.05. Nature of Letter of Credit Obligations Absolute. The
obligations of the Borrower to reimburse the DIP Lenders for drawings made
under any Letter of Credit shall be unconditional and irrevocable and shall be
paid strictly in accordance with the terms of this Agreement under all
circumstances, including, without limitation: (i) any lack of validity or
enforceability of any Letter of Credit; (ii) the existence of any claim,
setoff, defense or other right that the Borrower or any Guarantor may have at
any time against a beneficiary of any Letter of Credit or against any of the
DIP Lenders, whether in connection with this Agreement, the transactions
contemplated herein or any unrelated transaction; (iii) any draft, demand,
certificate or other document presented under any Letter of Credit proving to
be forged, fraudulent, invalid or insufficient in any respect or any statement
therein being untrue or inaccurate in any respect; (iv) payment by a Fronting
Bank of any Letter of Credit against presentation of a demand, draft or
certificate or other document which does not comply with the terms of such
Letter of Credit; (v) any other circumstance or happening whatsoever, that is
similar to any of the foregoing; or (vi) the fact that any Event of Default
shall have occurred and be continuing. None of the Agent, the DIP Lenders, the
Fronting Bank and their respective affiliates shall have any liability or
responsibility by reason of or in connection with the issuance or transfer of
any Letter of Credit or any payment or failure to make any payment thereunder
(irrespective of any of the circumstances referred to in the preceding
sentence), or any error, omission, interruption, loss or delay in transmission
or delivery of any draft, notice or other communication under or relating to
any Letter of Credit (including any document required to make a drawing
thereunder), any error in
21
interpretation of technical terms or any consequence arising from causes beyond
the control of the Fronting Bank; provided that the foregoing shall not excuse
the Fronting Bank from liability to the Borrower to the extent of any direct
damages (as opposed to consequential damages, claims in respect of which are
waived by the Borrower to the extent permitted by applicable law) suffered by
the Borrower that are caused by the Fronting Bank's failure to exercise care
when determining whether drafts and other documents presented under a Letter of
Credit comply with the terms thereof. Without limiting the generality of the
foregoing, the parties agree that, with respect to documents presented which
appear on their face to be in substantial compliance with the terms of a Letter
of Credit, the Fronting Bank may, in its sole discretion, either (A) accept and
make payment upon such documents without responsibility for further
investigation, regardless of any notice of information to the contrary, or (B)
refuse to accept and make payment upon such documents if such documents do not
strictly comply with the terms of such Letter of Credit.
SECTION 2.06. Making of Loans.
(a) Except as contemplated by Section 2.11, Loans shall be either
ABR Loans or Eurodollar Loans as the Borrower may request subject to and in
accordance with this Section, provided that all Loans made pursuant to the same
Borrowing shall, unless otherwise specifically provided herein, be Loans of the
same Type. Subject to Section 2.18, DIP Lender may fulfill its Commitment with
respect to any Eurodollar Loan or ABR Loan by causing any lending office of
such DIP Lender to make such Loan; provided that any such use of a lending
office shall not affect the obligation of the Borrower to repay such Loan in
accordance with the terms of this Agreement. Subject to the other provisions of
this Section and the provisions of Section 2.12, Borrowings of Loans of more
than one Type may be incurred at the same time, provided that no more than five
(5) Borrowings of Eurodollar Loans may be outstanding at any time.
(b) The Borrower shall give the Agent prior notice of each
Borrowing hereunder of at least three (3) Business Days for Eurodollar Loans
and one (1) Business Day for ABR Loans; such notice shall be irrevocable and
shall specify the amount of the proposed Borrowing (which shall not be less
than $1,000,000 or an integral multiple of $500,000 in excess thereof in the
case of Eurodollar Loans and not less than $500,000 or an integral multiple of
$100,000 in excess thereof in the case of ABR Loans) and the date thereof
(which shall be a Business Day) and shall contain disbursement instructions.
Such notice, to be effective, must be received by the Agent not later than
12:00 noon, New York City time, on the third Business Day in the case of
Eurodollar Loans and the first Business Day in the case of ABR Loans, preceding
the date on which such Borrowing is to be made except as provided in the last
sentence of this Section 2.06(b). Such notice shall specify whether the
Borrowing then being requested is to be a Borrowing of ABR Loans or Eurodollar
Loans. If no election is made as to the Type of Loan, such notice shall be
deemed a request for Borrowing of ABR Loans. The Agent shall promptly notify
each DIP Lender of its proportionate share of such Borrowing, the date of such
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Borrowing, the Type of Borrowing or Loans being requested and the Interest
Period or Interest Periods applicable thereto, as appropriate. On the borrowing
date specified in such notice, each DIP Lender shall make its share of the
Borrowing available at the office of the Agent, no later than 12:00 noon, New
York City time, in immediately available funds. Upon receipt of the funds made
available by the DIP Lenders to fund any borrowing hereunder, the Agent shall
disburse such funds in the manner specified in the notice of borrowing
delivered by the Borrower.
SECTION 2.07. Repayment of Loans; Evidence of Debt.
(a) The Borrower hereby unconditionally promises to pay to the
Agent for the account of each DIP Lender the then unpaid principal amount of
each Loan on the Termination Date.
(b) Each DIP Lender shall maintain in accordance with its usual
practice an account or accounts evidencing the indebtedness of the Borrower to
such DIP Lender resulting from each Loan made by such DIP Lender, including the
amounts of principal and interest payable and paid to such DIP Lender from time
to time hereunder.
(c) The Agent shall maintain accounts in which it shall record
(i) the amount of each Loan made hereunder, the Type thereof and the Interest
Period applicable thereto, (ii) the amount of any principal or interest due and
payable or to become due and payable from the Borrower to each DIP Lender
hereunder and (iii) the amount of any sum received by the Agent hereunder for
the account of the DIP Lenders and each DIP Lender's share thereof.
(d) The entries made in the accounts maintained pursuant to
paragraph (b) or (c) of this Section shall be prima facie evidence of the
existence and amounts of the obligations recorded therein; provided that the
failure of any DIP Lender or the Agent to maintain such accounts or any error
therein shall not in any manner affect the obligation of the Borrower to repay
the Loans in accordance with the terms of this Agreement.
(e) Any DIP Lender may request that Loans made by it be evidenced
by a promissory note. In such event, the Borrower shall execute and deliver to
such DIP Lender a promissory note payable to the order of such DIP Lender (or,
if requested by such DIP Lender, to such DIP Lender and its registered assigns)
in the form attached hereto as Exhibit B. Thereafter, the Loans evidenced by
such promissory note and interest thereon shall at all times (including after
assignment pursuant to Section 10.03) be represented by one or more promissory
notes in such form payable to the order of the payee named therein (or, if such
promissory note is a registered note, to such payee and its registered
assigns).
SECTION 2.08. Interest on Loans.
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(a) Subject to the provisions of Section 2.09, each ABR Loan
shall bear interest (computed on the basis of the actual number of days elapsed
over a year of 360 days) at a rate per annum equal to the Alternate Base Rate
plus 2.50%.
(b) Subject to the provisions of Section 2.09, each Eurodollar
Loan shall bear interest (computed on the basis of the actual number of days
elapsed over a year of 360 days) at a rate per annum equal, during each
Interest Period applicable thereto, to the Adjusted LIBOR Rate for such
Interest Period in effect for such Borrowing plus 3.50%.
(c) Accrued interest on all Loans shall be payable in arrears on
each Interest Payment Date applicable thereto, at maturity (whether by
acceleration or otherwise), after such maturity on demand and (with respect to
Eurodollar Loans) upon any repayment or prepayment thereof (on the amount
prepaid).
SECTION 2.09. Default Interest. If the Borrower or any Guarantor, as
the case may be, shall default in the payment of the principal of or interest
on any Loan or in the payment of any other amount becoming due hereunder
(including, without limitation, the reimbursement pursuant to Section 2.03(d)
of any draft drawn under a Letter of Credit), whether at stated maturity, by
acceleration or otherwise, the Borrower or such Guarantor, as the case may be,
shall on demand from time to time pay interest, to the extent permitted by law,
on such defaulted amount up to (but not including) the date of actual payment
(after as well as before judgment) at a rate per annum (computed on the basis
of the actual number of days elapsed over a year of 360 days) equal to (x) in
the case of Borrowings consisting of Eurodollar Loans, the Adjusted LIBOR Rate
in effect for such Borrowing plus 5.50% and (y) in the case of all other
amounts, the Alternate Base Rate plus 4.50%.
SECTION 2.10. Optional Termination or Reduction of Commitment. Upon at
least one Business Days' prior written notice to the Agent, the Borrower may at
any time in whole permanently terminate, or from time to time in part
permanently reduce, the Unused Total Commitment. Each such reduction of the
Commitments shall be in the principal amount of $1,000,000 or any integral
multiple of $500,000 in excess thereof. Simultaneously with each reduction or
termination of the Unused Total Commitment, the Borrower shall pay to the Agent
for the account of each DIP Lender the Commitment Fee accrued on the amount of
the Commitment of such DIP Lender so terminated or reduced through the date
thereof. Any reduction or termination, as applicable, of the Unused Total
Commitment pursuant to this Section shall be deemed to be a reduction or
termination of the Total Commitment and shall be applied pro rata to reduce the
Commitment of each DIP Lender.
SECTION 2.11. Alternate Rate of Interest. In the event, and on each
occasion, that on the day two Business Days prior to the commencement of any
Interest Period for a Eurodollar Loan, the Agent shall have determined (which
determination shall be conclusive and binding upon the Borrower absent manifest
error) that reasonable means
24
do not exist for ascertaining the applicable Adjusted LIBOR Rate, the Agent
shall, as soon as practicable thereafter, give written or telegraphic notice of
such determination to the Borrower and the DIP Lenders, and any request by the
Borrower for a Borrowing of Eurodollar Loans (including pursuant to a
refinancing with Eurodollar Loans) pursuant to Section 2.06 or 2.12 shall be
deemed a request for a Borrowing of ABR Loans. After such notice shall have
been given and until the circumstances giving rise to such notice no longer
exist, each request for a Borrowing of Eurodollar Loans shall be deemed to be a
request for a Borrowing of ABR Loans.
SECTION 2.12. Refinancing of Loans. The Borrower shall have the right,
at any time, on three Business Days' prior irrevocable notice to the Agent
(which notice, to be effective, must be received by the Agent not later than
1:00 p.m., New York City time, on the third Business Day preceding the date of
any refinancing), (x) to refinance (without the satisfaction of the conditions
set forth in Section 4 as a condition to such refinancing) any outstanding
Borrowing or Borrowings of Loans of one Type (or a portion thereof) with a
Borrowing of Loans of the other Type or (y) to continue an outstanding
Borrowing of Eurodollar Loans for an additional Interest Period, subject to the
following:
(a) as a condition to the refinancing of ABR Loans with
Eurodollar Loans and to the continuation of Eurodollar Loans for an
additional Interest Period, no Event of Default shall have occurred
and be continuing at the time of such refinancing;
(b) if less than a full Borrowing of Loans shall be
refinanced, such refinancing shall be made pro rata among the DIP
Lenders in accordance with the respective principal amounts of the
Loans comprising such Borrowing held by the DIP Lenders immediately
prior to such refinancing;
(c) the aggregate principal amount of Loans being
refinanced shall be at least $1,000,000, provided that no partial
refinancing of a Borrowing of Eurodollar Loans shall result in the
Eurodollar Loans remaining outstanding pursuant to such Borrowing
being less than $1,000,000 in aggregate principal amount;
(d) each DIP Lender shall effect each refinancing by
applying the proceeds of its new Eurodollar Loan or ABR Loan, as the
case may be, to its Loan being refinanced;
(e) the Interest Period with respect to a Borrowing of
Eurodollar Loans effected by a refinancing or in respect to the
Borrowing of Eurodollar Loans being continued as Eurodollar Loans
shall commence on the date of refinancing or the expiration of the
current Interest Period applicable to such continuing Borrowing, as
the case may be;
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(f) a Borrowing of Eurodollar Loans may be refinanced
only on the last day of an Interest Period applicable thereto; and
(g) each request for a refinancing with a Borrowing of
Eurodollar Loans that fails to state an applicable Interest Period
shall be deemed to be a request for an Interest Period of one month.
In the event that the Borrower shall not give notice to refinance any Borrowing
of Eurodollar Loans, or to continue such Borrowing as Eurodollar Loans, or
shall not be entitled to refinance or continue such Borrowing as Eurodollar
Loans, in each case as provided above, such Borrowing shall automatically be
refinanced with a Borrowing of ABR Loans at the expiration of the then-current
Interest Period. The Agent shall, after it receives notice from the Borrower,
promptly give each DIP Lender notice of any refinancing, in whole or part, of
any Loan made by such DIP Lender.
SECTION 2.13. Mandatory Prepayment, Commitment Reduction and
Termination; Cash Collateral.
(a) On the date on which the Borrower or any of the Guarantors
receives any Net Proceeds of a sale, lease, transfer or other disposition of
assets of the Borrower, a Guarantor or any other Affiliate of the Borrower that
are subject to Liens in favor of the Agent, the Total Commitment shall be
reduced by an amount equal to the Reduction Percentage of the amount of such
Net Proceeds; provided that if the Reduction Percentage of the Net Proceeds are
less than $1,000,000 such reduction shall be made upon receipt of Net Proceeds
such that, together with all other such amounts not previously applied,
aggregate Net Proceeds required to be applied and not so applied are equal to
at least $1,000,000.
(b) If at any time the aggregate principal amount of the
outstanding Loans plus the aggregate Letter of Credit Outstandings exceeds the
lesser of (x) the Total Commitment and (y) the Available Commitment (after
giving effect to any reduction to the Total Commitment pursuant to paragraph
(a) of this Section), the Borrower will, within one Business Day,
(i) prepay the Loans in an amount necessary to cause
the aggregate principal amount of the outstanding Loans plus
the aggregate Letter of Credit Outstandings to be equal to or
less than the lesser of (x) the Total Commitment and (y) the
Available Commitment, and
(ii) if, after giving effect to the prepayment in
full of the Loans, the aggregate Letter of Credit
Outstandings in excess of the amount of cash held in the
Letter of Credit Account exceeds the lesser of (x) the Total
Commitment and (y) the Available Commitment, deposit into the
Letter of Credit Account an amount equal to 105% of the
amount by which the
26
aggregate Letter of Credit Outstandings in excess of the amount of cash held in
the Letter of Credit Account so exceeds the lesser of (x) the Total Commitment
or (y) the Available Commitment.
(c) Upon the Termination Date, the Total Commitment shall be
terminated in full and the Borrower shall pay the Loans in full and, except as
the Agent may otherwise agree in writing, if any Letter of Credit remains
outstanding, comply with Section 2.03(b).
(d) The Borrower shall notify the Agent by telephone (confirmed
by telecopy) of any prepayment or reduction under this Section not later than
12:30 p.m., New York City time, three Business Days (or as soon as practicable
if it is not practicable to provide three Business Days notice) before the date
of prepayment or reduction, as the case may be (or, solely if such prepayment
will be a prepayment of ABR Loans only, no later than 12:30 p.m., New York City
time, on the date of such prepayment). Each such notice shall be irrevocable
and shall specify the prepayment date and the principal amount of each
Borrowing or portion thereof to be prepaid (which may be the Borrower's then
best estimate thereof if due to the nature of the transaction giving rise to
such prepayment or reduction, the amount or date thereof cannot be determined
with certainty). Promptly following receipt of any such notice, the Agent shall
advise the affected DIP Lenders of the contents thereof.
SECTION 2.14. Optional Prepayment of Loans; Reimbursement of DIP
Lenders.
(a) The Borrower shall have the right at any time and from time
to time to prepay any Loans, in whole or in part, (x) with respect to
Eurodollar Loans, upon at least three Business Days' prior written, telex or
facsimile notice to the Agent and (y) with respect to ABR Loans on the same
Business Day if written, telex or facsimile notice is received by the Agent
prior to 1:00 p.m., New York City time, and thereafter upon at least one
Business Day's prior written, telex or facsimile notice to the Agent; provided,
however, that (i) each such partial prepayment shall be in integral multiples
of $100,000 and, in any event not less than $500,000 and (ii) no prepayment of
Eurodollar Loans shall be permitted pursuant to this Section 2.14(a) other than
on the last day of an Interest Period applicable thereto unless such prepayment
is accompanied by the payment of the amounts described in clause (i) of the
first sentence of Section 2.14(b), and (iii) no partial prepayment of a
Borrowing of Eurodollar Loans shall result in the aggregate principal amount of
the Eurodollar Loans remaining outstanding pursuant to such Borrowing being
less than $1,000,000. Each notice of prepayment shall specify the prepayment
date, the principal amount of the Loans to be prepaid and in the case of
Eurodollar Loans, the Borrowing or Borrowings pursuant to which made, shall be
irrevocable and shall commit the Borrower to prepay such Loan by the amount and
on the date stated therein. The Agent shall, promptly after receiving notice
from the Borrower hereunder, notify each DIP Lender of the principal amount of
the Loans held by such DIP Lender that are to be prepaid, the prepayment date
and the manner of application of the prepayment.
27
(b) The Borrower shall reimburse each DIP Lender on demand for
any loss incurred or to be incurred by it in the reemployment of the funds
released (i) resulting from any prepayment (for any reason whatsoever,
including, without limitation, refinancing with ABR Loans) of any Eurodollar
Loan required or permitted under this Agreement, if such Loan is prepaid other
than on the last day of the Interest Period for such Loan (including, without
limitation, any such prepayment in connection with the syndication of the
credit facility evidenced by this Agreement) or (ii) in the event that after
the Borrower delivers a notice of borrowing under Section 2.06 in respect of
Eurodollar Loans, such Loans are not made on the first day of the Interest
Period specified in such notice of borrowing for any reason other than a breach
by such DIP Lender of its obligations hereunder. Such loss shall be the amount
as reasonably determined by such DIP Lender as the excess, if any, of (A) the
amount of interest which would have accrued to such DIP Lender on the amount so
paid or not borrowed at a rate of interest equal to the Adjusted LIBOR Rate for
such Loan (excluding loss of anticipated profits or margin), for the period
from the date of such payment or failure to borrow to the last day (x) in the
case of a payment or refinancing with ABR Loans other than on the last day of
the Interest Period for such Loan, of the then current Interest Period for such
Loan, or (y) in the case of such failure to borrow, of the Interest Period for
such Loan which would have commenced on the date of such failure to borrow,
over (B) the amount of interest which would have accrued to such DIP Lender on
such amount by placing such amount on deposit for a comparable period with
leading banks in the London interbank market. Each DIP Lender shall deliver to
the Borrower from time to time one or more certificates setting forth the
amount of such loss as determined by such DIP Lender.
(c) In the event the Borrower fails to prepay any Loan on the
date specified in any prepayment notice delivered pursuant to Section 2.14(a),
the Borrower on demand by any DIP Lender shall pay to the Agent for the account
of such DIP Lender any amounts required to compensate such DIP Lender for any
loss incurred by such DIP Lender as a result of such failure to prepay,
including, without limitation, any loss, cost or expenses incurred by reason of
the acquisition of deposits or other funds by such DIP Lender to fulfill
deposit obligations incurred in anticipation of such prepayment, but without
duplication of any amounts paid under Section 2.14(b). Each DIP Lender shall
deliver to the Borrower from time to time one or more certificates setting
forth the amount of such loss as determined by such DIP Lender.
(d) Any partial prepayment of the Loans by the Borrower pursuant
to Sections 2.13 or 2.14 shall be applied as specified by the Borrower or, in
the absence of such specification, as determined by the Agent, and shall be
applied to repay ratably the Loan of the several DIP Lenders included within
such Borrowing or Borrowings, provided that, in the event such a partial
prepayment is applied as determined by the Agent (in the absence of a
specification by the Borrower), no Eurodollar Loans shall be prepaid pursuant
to Section 2.13 to the extent that such Loan has an Interest Period ending
after the required date of prepayment unless and until all outstanding ABR
Loans and Eurodollar Loans with Interest Periods ending on such date have been
repaid in full.
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SECTION 2.15. Reserve Requirements; Change in Circumstances.
(a) Notwithstanding any other provision herein, if after the date
of this Agreement any change in applicable law or regulation or in the
interpretation or administration thereof by any Governmental Authority charged
with the interpretation or administration thereof (whether or not having the
force of law) shall change the basis of taxation of payments to any DIP Lender
of the principal of or interest on any Eurodollar Loan made by such DIP Lender
or any fees or other amounts payable hereunder (other than changes in respect of
Taxes, Other Taxes and taxes imposed on, or measured by, the net income or
overall gross receipts or franchise taxes of such DIP Lender by the jurisdiction
in which such DIP Lender has its principal office or in which the applicable
lending office for such Eurodollar Loan is located or by any political
subdivision or taxing authority therein, or by any other jurisdiction or by any
political subdivision or taxing authority therein other than a jurisdiction in
which such DIP Lender would not be subject to tax but for the execution and
performance of this Agreement), or shall impose, modify or deem applicable any
reserve, special deposit or similar requirement against assets of, deposits with
or for the account of or credit extended by such DIP Lender (except any such
reserve requirement that is reflected in the Adjusted LIBOR Rate) or shall
impose on such DIP Lender or the London interbank market any other condition
affecting this Agreement or the Eurodollar Loans made by such DIP Lender, and
the result of any of the foregoing shall be to increase the cost to such DIP
Lender of making or maintaining any Eurodollar Loan or to reduce the amount of
any sum received or receivable by such DIP Lender hereunder (whether of
principal, interest or otherwise) by an amount deemed by such DIP Lender to be
material, then the Borrower will pay to such DIP Lender in accordance with
paragraph (c) below such additional amount or amounts as will compensate such
DIP Lender for such additional costs incurred or reduction suffered.
(b) If any DIP Lender shall have determined that the adoption or
effectiveness after the date hereof of any law, rule, regulation or guideline
regarding capital adequacy, or any change in any of the foregoing or in the
interpretation or administration of any of the foregoing by any governmental
authority, central bank or comparable agency charged with the interpretation of
administration thereof, or compliance by any DIP Lender (or any lending office
of such DIP Lender) or any DIP Lender's holding company with any request or
directive regarding capital adequacy (whether or not having the force of law) of
any such authority, central bank or comparable agency, has or would have the
effect of reducing the rate of return on such DIP Lender's capital or on the
capital of such DIP Lender's holding company, if any, as a consequence of this
Agreement, the Loans made by such DIP Lender pursuant hereto, such DIP Lender's
Commitment hereunder or the issuance of, or participation in, any Letter of
Credit by such DIP Lender to a level below that which such DIP Lender or such
DIP Lender's holding company could have achieved but for such adoption, change
or compliance (taking into account DIP Lender's policies and the policies of
such DIP Lender's holding company with respect to capital adequacy)
29
by an amount deemed by such DIP Lender to be material, then from time to time
the Borrower shall pay to such DIP Lender such additional amount or amounts as
will compensate such DIP Lender or such DIP Lender's holding company for any
such reduction suffered.
(c) A certificate of each DIP Lender setting forth such amount or
amounts as shall be necessary to compensate such DIP Lender or its holding
company as specified in paragraph (a) or (b) above, as the case may be, shall be
delivered to the Borrower and shall be conclusive absent manifest error. The
Borrower shall pay each DIP Lender the amount shown as due on any such
certificate delivered to it within 10 days after its receipt of the same. Any
DIP Lender receiving any such payment shall promptly make a refund thereof to
the Borrower if the law, regulation, guideline or change in circumstances giving
rise to such payment is subsequently deemed or held to be invalid or
inapplicable.
(d) Failure on the part of any DIP Lender to demand compensation
for any increased costs or reduction in amounts received or receivable or
reduction in return on capital with respect to any period shall not constitute a
waiver of such DIP Lender's right to demand compensation with respect to such
period or any other period. The protection of this Section shall be available to
each DIP Lender regardless of any possible contention of the invalidity or
inapplicability of the law, rule, regulation, guideline or other change or
condition which shall have occurred or been imposed.
SECTION 2.16. Change in Legality.
(a) Notwithstanding anything to the contrary contained elsewhere
in this Agreement, if (x) any change after the date of this Agreement in any law
or regulation or in the interpretation thereof by any Governmental Authority
charged with the administration thereof shall make it unlawful for a DIP Lender
to make or maintain a Eurodollar Loan or to give effect to its obligations as
contemplated hereby with respect to a Eurodollar Loan or (y) at any time any DIP
Lender determines that the making or continuance of any of its Eurodollar Loans
has become impracticable as a result of a contingency occurring after the date
hereof that adversely affect the London interbank market or the position of such
DIP Lender in such market, then, by written notice to the Borrower, such DIP
Lender may (i) declare that Eurodollar Loans will not thereafter be made by such
DIP Lender hereunder, whereupon any request by the Borrower for a Eurodollar
Borrowing shall, as to such DIP Lender only, be deemed a request for an ABR Loan
unless such declaration shall be subsequently withdrawn; and (ii) require that
all outstanding Eurodollar Loans made by it be converted to ABR Loans, in which
event all such Eurodollar Loans shall be automatically converted to ABR Loans as
of the effective date of such notice as provided in paragraph (b) below. In the
event any DIP Lender shall exercise its rights under clause (i) or (ii) of this
paragraph (a), all payments and prepayments of principal which would otherwise
have been applied to repay the Eurodollar Loans that would have been made by
such DIP Lender or the converted Eurodollar Loans of such DIP Lender shall
instead be applied to repay the ABR Loans
30
made by such DIP Lender in lieu of, or resulting from the conversion of, such
Eurodollar Loans.
(b) For purposes of this Section 2.16, a notice to the Borrower by
any DIP Lender pursuant to paragraph (a) above shall be effective, if lawful,
and if any Eurodollar Loans shall then be outstanding, on the last day of the
then-current Interest Period; otherwise, such notice shall be effective on the
date of receipt by the Borrower.
SECTION 2.17. Pro Rata Treatment, Etc. All payments and repayments of
principal and interest in respect of the Loans (except as provided in Sections
2.15 and 2.16) shall be made pro rata among the DIP Lenders in accordance with
the then outstanding principal amount of the Loans and/or participations in
Letter of Credit Outstandings and all outstanding undrawn Letters of Credit (and
the unreimbursed amount of drawn Letters of Credit) hereunder and all payments
of Commitment Fees and Letter of Credit Fees (other than those payable to a
Fronting Bank) shall be made pro rata among the DIP Lenders in accordance with
their Commitments. Interest in respect of any Loan hereunder shall accrue from
and including the date of such Loan to but excluding the date on which such Loan
is paid in full or converted to a Loan of a different Type.
SECTION 2.18. Taxes.
(a) Any and all payments by the Borrower or any Guarantor
hereunder shall be made free and clear of and without deduction for any and all
current or future taxes, levies, imposts, deductions, charges or withholdings,
and all liabilities with respect thereto, excluding (i) taxes imposed on or
measured by the net income or overall gross receipts of the Agent or any DIP
Lender (or, as contemplated by Section 10.03 hereof, any transferee or assignee
thereof, including a participation holder (any such entity being called a
"TRANSFEREE")) and franchise taxes imposed on the Agent or any DIP Lender (or
Transferee) by the United States or any jurisdiction under the laws of which the
Agent or any DIP Lender (or Transferee) is organized or in which the applicable
lending office of any such DIP Lender (or Transferee) or applicable office of
the Agent is located or any political subdivision thereof or by any other
jurisdiction or by any political subdivision or taxing authority therein other
than a jurisdiction in which the Agent or such DIP Lender would not be subject
to tax but for the execution and performance of this Agreement and (ii) taxes,
levies, imposts, deductions, charges or withholdings ("AMOUNTS") with respect to
payments hereunder to a DIP Lender (or Transferee) or the Agent in accordance
with laws in effect on the later of the date of this Agreement and the date such
DIP Lender (or Transferee) or the Agent becomes a DIP Lender (or Transferee or
Agent, as the case may be), but not excluding, with respect to such DIP Lender
(or Transferee) or the Agent, any increase in such Amounts solely as a result of
any change in such laws occurring after such later date or any Amounts that
would not have been imposed but for actions (other than actions contemplated by
this Agreement) taken by the Borrower after such later date (all such
nonexcluded taxes, levies, imposts, deductions, charges, withholdings and
liabilities being hereinafter referred to as "TAXES"). If the Borrower or any
Guarantor
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shall be required by law to deduct any Taxes from or in respect of any sum
payable hereunder to the DIP Lenders (or any Transferee) or the Agent, (i) the
sum payable shall be increased by the amount necessary so that after making all
required deductions (including deductions applicable to additional sums payable
under this Section) such DIP Lender (or Transferee) or the Agent (as the case
may be) shall receive an amount equal to the sum it would have received had no
such deductions been made, (ii) the Borrower shall make such deductions and
(iii) the Borrower shall pay the full amount deducted to the relevant taxing
authority or other Governmental Authority in accordance with applicable law.
(b) In addition, the Borrower agrees to pay any current or future
stamp or documentary taxes or any other excise or property taxes, charges,
assessments or similar levies that arise from any payment made hereunder or from
the execution, delivery or registration of, or otherwise with respect to, this
Agreement or any other Loan Document (hereinafter referred to as "OTHER TAXES").
(c) The Borrower will indemnify each DIP Lender (or Transferee)
and the Agent for the full amount of Taxes and Other Taxes paid by such DIP
Lender (or Transferee) or the Agent, as the case may be, and any liability
(including penalties, interest and expenses) arising therefrom or with respect
thereto, whether or not such Taxes or Other Taxes were correctly or legally
asserted by the relevant taxing authority or other Governmental Authority. Such
indemnification shall be made within 30 days after the date any DIP Lender (or
Transferee) or the Agent, as the case may be, makes written demand therefor. If
a DIP Lender (or Transferee) or the Agent shall become aware that it is entitled
to receive a refund in respect of Taxes or Other Taxes as to which it has been
indemnified by the Borrower pursuant to this Section, it shall promptly notify
the Borrower of the availability of such refund and shall, within 30 days after
receipt of a request by the Borrower, apply for such refund at the Borrower's
expense. If any DIP Lender (or Transferee) or the Agent receives a refund in
respect of any Taxes or Other Taxes as to which it has been indemnified by the
Borrower pursuant to this Section, it shall promptly notify the Borrower of such
refund and shall, within 30 days after receipt of a request by the Borrower (or
promptly upon receipt, if the Borrower has requested application for such refund
pursuant hereto), repay such refund to the Borrower (to the extent of amounts
that have been paid by the Borrower under this Section with respect to such
refund plus interest that is received by the DIP Lender (or Transferee) or the
Agent as part of the refund), net of all out-of-pocket expenses of such DIP
Lender (or Transferee) or the Agent and without additional interest thereon;
provided that the Borrower, upon the request of such DIP Lender (or Transferee)
or the Agent, agrees to return such refund (plus penalties, interest or other
charges) to such DIP Lender (or Transferee) or the Agent in the event such DIP
Lender (or Transferee) or the Agent is required to repay such refund. Nothing
contained in this subsection (c) shall require any DIP Lender (or Transferee) or
the Agent to make available any of its tax returns (or any other information
relating to its taxes that it deems to be confidential).
32
(d) Within 30 days after the date of any payment of Taxes or Other
Taxes withheld by the Borrower in respect of any payment to any DIP Lender (or
Transferee) or the Agent, the Borrower will furnish to the Agent, at its address
referred to on the signature pages hereof, the original or a certified copy of a
receipt evidencing payment thereof (or, if such a receipt is not available,
other written documentation reasonably satisfactory to the Agent).
(e) Without prejudice to the survival of any other agreement
contained herein, the agreements and obligations contained in this Section shall
survive the payment in full of the principal of and interest on all Loans made
hereunder.
(f) Each DIP Lender (or Transferee) that is organized under the
laws of a jurisdiction outside the United States shall, if legally able to do
so, prior to the immediately following due date of any payment by the Borrower
hereunder, deliver to the Borrower such certificates, documents or other
evidence, as required by the Code or Treasury Regulations issued pursuant
thereto, including Internal Revenue Service Form W-8INY, Form W-8ECI or Form
W-8BEN or any subsequent version thereof or successors thereto, properly
completed and duly executed by such DIP Lender (or Transferee) establishing that
such payment is (i) not subject to United States Federal withholding tax under
the Code because such payment is effectively connected with the conduct by such
DIP Lender (or Transferee) of a trade or business in the United States or (ii)
totally exempt from United States Federal withholding tax or subject to a
reduced rate of such tax under a provision of an applicable tax treaty. Unless
the Borrower and the Agent have received forms or other documents satisfactory
to them indicating that such payments hereunder or are not subject to United
States Federal withholding tax or are subject to such tax at a rate reduced by
an applicable tax treaty, the Borrower or the Agent shall withhold taxes from
such payments at the applicable statutory rate.
(g) The Borrower shall not be required to pay any additional
amounts to any DIP Lender (or Transferee) in respect of United States Federal
withholding tax pursuant to subsection (a) above if the obligation to pay such
additional amounts would not have arisen but for a failure by such DIP Lender
(or Transferee) to comply with the provisions of subsection (f) above.
(h) Any DIP Lender (or Transferee) claiming any additional amounts
payable pursuant to Section 2.15 or this Section 2.18 shall use reasonable
efforts (consistent with legal and regulatory restrictions) to file any
certificate or document requested by the Borrower or to change the jurisdiction
of its applicable lending office if the making of such a filing or change would
avoid the need for or reduce the amount of any such additional amounts that may
thereafter accrue and would not, in the sole determination of such DIP Lender,
be otherwise materially disadvantageous to such DIP Lender (or Transferee) or
the Agent.
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SECTION 2.19. Certain Fees. (a) Upfront Fee. The Borrower agrees to pay
to the Agent for the ratable benefit of the DIP Lenders an upfront fee (the
"UPFRONT FEE") equal to 2% of the Available Commitment payable in installments
as follows:
(i) on the Closing Date, the Borrower shall pay 2% of the
amount of the Available Commitment on the Closing Date (that is,
$200,000 or 2% of $10,000,000);
(ii) on the date of the Final Order, the Borrower shall
pay 2% of the amount of the Available Commitment (determined without
giving effect to any reduction in the Available Commitment as a
consequence of clause (y)(ii) of the definition of Available
Commitment) in excess of $10,000,000; and
(iii) on each date after the date of the Final Order on
which the Available Commitment increases, the Borrower shall pay 2% of
the amount of such increase.
(b) Agent's Fee. The Borrower acknowledges its agreement to pay to
the Agent, for the Agent's own account, an administrative agency fee at the
times and in the amounts heretofore agreed between the Borrower and the Agent.
SECTION 2.20. Commitment Fee. The Borrower shall pay to the DIP Lenders
a commitment fee (the "COMMITMENT FEE") for the period commencing on the date
hereof to the Termination Date or the earlier date of termination of the
Commitment, computed (on the basis of the actual number of days elapsed over a
year of 360 days) at the rate of 0.75% per annum on the average daily Unused
Total Commitment. Such Commitment Fee, to the extent then accrued, shall be
payable (x) monthly, in arrears, on the last calendar day of each month, (y) on
the Termination Date and (z) as provided in Section 2.10 hereof, upon any
reduction or termination in whole or in part of the Total Commitment.
SECTION 2.21. Letter of Credit Fees. The Borrower shall pay with
respect to each Letter of Credit (i) to the Agent on behalf of the DIP Lenders a
fee calculated (on the basis of the actual number of days elapsed over a year of
360 days) at the rate of (x) 2.50% per annum on the undrawn stated amount
thereof and (ii) to the Fronting Bank such Fronting Bank's customary fees for
issuance, amendments and processing referred to in Section 2.03. In addition,
the Borrower agrees to pay each Fronting Bank for its account a fronting fee in
respect of each Letter of Credit issued by such Fronting Bank, for the period
from and including the date of issuance of such Letter of Credit to and
including the date of termination of such Letter of Credit, computed at a rate,
and payable at times, to be determined by such Fronting Bank, the Borrower and
the Agent. Accrued fees described in clause (i) of the first sentence of this
paragraph in respect of each Letter of Credit shall be due and payable monthly
in arrears on the last calendar day of each month and on the Termination Date,
or such earlier date as the Total Commitment is
34
terminated. Accrued fees described in clause (ii) of the first sentence of this
paragraph in respect of each Letter of Credit shall be payable at times to be
determined by the Fronting Bank, the Borrower and the Agent.
SECTION 2.22. Nature of Fees. All Fees shall be paid on the dates due,
in immediately available funds, to the Agent for the respective accounts of the
Agent, the Fronting Bank and the DIP Lenders, as provided herein and in the
letter described in Section 2.19. Once paid, none of the Fees shall be
refundable under any circumstances.
SECTION 2.23. Priority and Liens.
(a) The Borrower and each of the Guarantors hereby covenants,
represents and warrants that, upon entry of the Interim Order, the Obligations
of the Borrower and each of the Guarantors that is the subject of a Case
hereunder and under the Loan Documents and in respect of Indebtedness permitted
by Section 6.03(a)(iv):
(i) pursuant to Section 364(c)(1) of the Bankruptcy Code,
shall at all times constitute an allowed Superpriority Claim;
(ii) pursuant to Section 364(c)(2) of the Bankruptcy Code,
shall at all times be secured by a perfected first priority Lien on all
cash maintained in the Letter of Credit Account and any investments of
the funds contained therein;
(iii) pursuant to Section 364(c)(3) of the Bankruptcy Code,
shall be secured by a perfected Lien upon all property of the Borrower
and the Guarantors that are subject to the Cases (other than Primed
Assets, as to which the Lien in favor of the Agent and the DIP Lenders
will be as described in clause (iv) of this sentence) that is subject
to valid and perfected liens in existence on the Petition Date or in
existence on the Petition Date that are perfected subsequent to the
Petition Date as permitted by Section 546(b) of the Bankruptcy Code
Liens or granted after the Petition Date to provide adequate protection
or that are Permitted Liens, which perfected Lien shall be junior to
such valid and perfected Liens and junior to Liens securing certain
intercompany advances as provided in the Orders; provided that such
Lien need not apply to the property of Impac Hotels II, L.L.C. or Impac
Hotels III, L.L.C. prior to the Final Order being entered; and
(iv) pursuant to Section 364(d)(1) of the Bankruptcy Code,
shall be secured by a perfected first priority, senior priming Lien on
all Primed Assets, subject only to (x) in the event of the occurrence
and during the continuance of an Event of Default or an event that
would constitute an Event of Default with the giving of notice or lapse
of time or both, the payment of allowed and unpaid professional fees
and disbursements incurred by the Borrower, the Guarantors and any
statutory committees appointed in the Cases in an aggregate amount not
in excess of $1.5 million and (y) the payment of unpaid fees pursuant
to 28 U.S.C.ss.
35
1930 and to the Clerk of the Bankruptcy Court (collectively, the
"CARVE-OUT"), provided that amounts in the Letter of Credit Account and
any investment of the funds contained therein shall not be subject to
the Carve-Out, and provided further, that, except as otherwise provided
in the Orders, no portion of the Carve-Out shall be utilized for the
payment of professional fees and disbursements incurred in connection
with any investigation of or challenge to the amount, extent, priority,
validity, perfection or enforcement of the indebtedness of the Borrower
and the Guarantors owing to the Pre-Petition Lenders or to the
collateral securing such indebtedness, and provided further that,
except as otherwise provided in Orders, as to proceeds of causes of
action to recover preferences, fraudulent transfers or other avoidance
claims under chapter 5 of the Bankruptcy Code, the Agent and the DIP
Lenders shall have been granted an administrative claim pursuant to
Section 503(b) of the Bankruptcy Code. The Superpriority Claims shall
at all times be senior to the rights of the Borrower, the Guarantors,
any chapter 11 trustee and, subject to section 726 of the Bankruptcy
Code, any chapter 7 trustee, or any other creditor (including, without
limitation, post-petition vendors and other post-petition creditors) in
the Cases or any subsequent proceedings under the Bankruptcy Code,
including, without limitation, any chapter 7 cases if any of the
Borrower's or the Guarantors' Cases are converted to cases under
chapter 7 of the Bankruptcy Code, subject only to the Carve-Out. The
DIP Lenders agree that so long as no Event of Default or event which
with the giving of notice or lapse of time or both would constitute an
Event of Default shall have occurred, the Borrower and the Guarantors
shall be permitted to pay compensation and reimbursement of expenses
incurred in the ordinary course of business, or professional fees
allowed and payable under 11 U.S.C.ss.330 and 11 U.S.C.ss.331 or
otherwise permitted to be paid by Court order, as the same may be due
and payable, and any compensation and expenses previously paid, or
accrued but unpaid, prior to the occurrence of such Event of Default
shall not reduce the Carve-Out.
(b) As to all real property the title to which is held by the
Borrower or any of the Guarantors, or the possession of which is held by the
Borrower or any of the Guarantors pursuant to leasehold interest, the Borrower
and each such Guarantor hereby assigns and conveys as security, grants a
security interest in, hypothecates, mortgages, pledges and sets over unto the
Agent on behalf of the DIP Lenders all of the right, title and interest of the
Borrower and such Guarantor in all of such owned real property and in all such
leasehold interests, together in each case with all of the right, title and
interest of the Borrower and such Guarantor in and to all buildings,
improvements, and fixtures related thereto, any lease or sublease thereof, all
general intangibles relating thereto and all proceeds thereof. The Borrower and
each Guarantor that is a subject of a Case acknowledges that, pursuant to the
Orders, the Liens in favor of the Agent on behalf of the DIP Lenders in all of
such real property and leasehold instruments shall be perfected without the
recordation of any instruments of mortgage or assignment. The Borrower and each
Guarantor further agree that, promptly upon the request of the Agent, the
Borrower
36
and such Guarantor shall enter into separate fee and leasehold mortgages in
recordable form with respect to such properties on terms satisfactory to the
Agent and take all steps necessary to record and perfect such mortgages and real
property liens under applicable non-bankruptcy law. The provisions of this
Section shall not become effective with respect to Impac Hotels II, L.L.C. and
Impac Hotels III, L.L.C. (and their respective assets) until the date of the
Final Order.
SECTION 2.24. Right of Set-off. Subject to the provisions of Section
7.01, upon the occurrence and during the continuance of any Event of Default,
the Agent and each DIP Lender is hereby authorized at any time and from time to
time, to the fullest extent permitted by law and without further order of or
application to the Bankruptcy Court, but without prejudice to valid and
pre-existing Liens and claims of other creditors, to set off and apply any and
all deposits (general or special, time or demand, provisional or final) at any
time held and other indebtedness at any time owing by the Agent and each such
DIP Lender to or for the credit or the account of the Borrower or any Guarantor
against any and all of the obligations of such Borrower or Guarantor then due
and owing under the Loan Documents, irrespective of whether or not such DIP
Lender shall have made any demand under any Loan Document. Each DIP Lender and
the Agent agrees promptly to notify the Borrower and the Guarantors after any
such set-off and application made by such DIP Lender or by the Agent, as the
case may be, provided that the failure to give such notice shall not affect the
validity of such set-off and application. The rights of each DIP Lender and the
Agent under this Section are in addition to other rights and remedies that such
DIP Lender and the Agent may have upon the occurrence and during the continuance
of any Event of Default.
SECTION 2.25. Security Interest in Letter of Credit Account. The
Borrower and the Guarantors hereby assign and pledge to the Agent, for its
benefit and for the ratable benefit of the DIP Lenders, and hereby grant to the
Agent, for its benefit and for the ratable benefit of the DIP Lenders, a first
priority security interest, senior to all other Liens, if any, in all of the
Borrower's and the Guarantors' right, title and interest in and to the Letter of
Credit Account and direct investment of the funds contained therein. Cash held
in the Letter of Credit Account shall not be available for use by the Borrower,
whether pursuant to Section 363 of the Bankruptcy Code or otherwise. The
provisions of this Section shall not become effective with respect to Impac
Hotels II, L.L.C. and Impac Hotels III, L.L.C. (and their respective assets)
until the date of the Final Order.
SECTION 2.26. Payment of Obligations. Subject to the provisions of
Section 7.01, upon the maturity (whether by acceleration or otherwise) of any of
the Obligations under this Agreement or any of the other Loan Documents of the
Borrower and the Guarantors, the DIP Lenders shall be entitled to immediate
payment of such Obligations, and to exercise foreclosure and other remedies
under the Loan Documents, without further application to or order of the
Bankruptcy Court.
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SECTION 2.27. No Discharge; Survival of Claims. Each of the Borrower
and the Guarantors agrees that (i) its obligations hereunder shall not be
discharged by the entry of an order confirming any Plan of Reorganization (and
each of the Borrower and the Guarantors, pursuant to Section 1141(d)(4) of the
Bankruptcy Code, hereby waives any such discharge) and (ii) the Superpriority
Claim granted to the Agent and the DIP Lenders pursuant to the Order and
described in Section 2.23 and the Liens granted to the Agent pursuant to the
Order and described in Sections 2.23 and 2.25 shall not be affected in any
manner by the entry of an order confirming any Plan of Reorganization.
SECTION 2.28. Use of Cash Collateral. Notwithstanding anything to the
contrary contained herein, the Borrower shall not be permitted (i) to request a
Borrowing under Section 2.06 or request the issuance of a Letter of Credit under
Section 2.04 unless the Bankruptcy Court shall have entered the Interim Order or
(ii) to request a Borrowing under Section 2.06 unless the Borrower and the
Guarantors shall at that time have the use of all cash collateral subject to the
Orders for the purposes described in Section 3.10.
SECTION 2.29. General Provisions as to Payments. The Borrower shall
make each payment of principal of, and interest on, the Loans and of fees
hereunder, not later than 12:00 noon (New York City time) on the date when due
in Federal or other funds immediately available in New York City, without
set-off or counterclaim, to the DIP Lenders at their addresses referred to in
Section 10.01. Whenever any payment of principal of, or interest on, the Loans
or of fees shall be due on a day which is not a Business Day, the date for
payment thereof shall be extended to the next Business Day. If the date for any
payment of principal is extended by operation of law or otherwise, interest
thereon shall be payable for such extended time.
ARTICLE 3
REPRESENTATIONS AND WARRANTIES
In order to induce the DIP Lenders to make Loans and issue and/or
participate in Letters of Credit hereunder, the Borrower and each of the
Guarantors jointly and severally represent and warrant as follows:
SECTION 3.01. Organization and Authority. Each of the Borrower and the
Guarantors (i) is duly organized and validly existing under the laws of the
State of its incorporation or formation, (ii) is duly qualified as a foreign
corporation (or other entity) and is in good standing in each jurisdiction in
which the failure to so qualify would have a material adverse effect on the
financial condition, operations, business, properties or assets of the Borrower
and the Guarantors, taken as a whole, (iii) subject to the entry by the
Bankruptcy Court of the Interim Order (or the Final Order, when applicable) has
the requisite corporate power and authority to effect the transactions
contemplated hereby, and by the other Loan Documents to which it is a party and
(iv) subject to the entry by the
38
Bankruptcy Court of the Interim Order (or the Final Order, when applicable) has
all requisite corporate power and authority and the legal right to own, pledge,
mortgage, lease and operate its properties, and to conduct its business as now
or currently proposed to be conducted.
SECTION 3.02. Due Execution. Upon the entry by the Bankruptcy Court of
the Interim Order (or the Final Order, when applicable), the execution, delivery
and performance by each of the Borrower and the Guarantors of each of the Loan
Documents to which it is a party (including, without limitation, the grant and
pledge by the Borrower and the Guarantors party thereto of the security
interests granted pursuant to the Security and Pledge Agreement), (i) are within
the respective corporate powers of each of the Borrower and the Guarantors, have
been duly authorized by all necessary corporate action, including the consent of
shareholders, partners or members where required, and do not (A) contravene the
charter, by-laws or other organizational documents of any of the Borrower or the
Guarantors, (B) violate any law (including, without limitation, the Securities
Exchange Act of 1934) or regulation (including, without limitation, Regulations
T, U or X of the Board of Governors of the Federal Reserve System), or any order
or decree of any court or Governmental Authority, (C) conflict with or result in
a breach of, or constitute a default under, any material indenture, mortgage or
deed of trust entered into after the Petition Date or any material lease,
agreement or other instrument entered into after the Petition Date binding on
the Borrower or the Guarantors or any of their properties, or (D) result in or
require the creation or imposition of any Lien upon any of the property of any
of the Borrower or the Guarantors other than the Liens granted pursuant to this
Agreement, the other Loan Documents or the Orders; and (ii) do not require the
consent, authorization by or approval of or notice to or filing or registration
with any Governmental Authority other than the entry of the Orders. Except for
the entry of the Orders (and in the case of Guarantors that are not subject to
the Cases, the filing of appropriate UCC financing statements), no
authorization, approval or other action by, and no notice to or filing with, any
Governmental Authority or regulatory body is required for the perfection of the
security interests granted pursuant to the Loan Documents or, subject to Section
7.01 hereof, the exercise by the Agent or the DIP Lenders of their respective
rights and remedies under the Loan Documents. Upon the entry by the Bankruptcy
Court of the Interim Order (or the Final Order, when applicable), this Agreement
shall have been duly executed and delivered by each of the Borrower and the
Guarantors. Upon the entry by the Bankruptcy Court of the Interim Order (or the
Final Order, when applicable), this Agreement, and each of the other Loan
Documents to which the Borrower or any of the Guarantors is or will be a party,
when delivered hereunder or thereunder, will be, a legal, valid and binding
obligation of the Borrower or such Guarantor, as the case may be, enforceable
against the Borrower or such Guarantor, as the case may be, in accordance with
its terms and the Orders.
SECTION 3.03. Statements Made. The information that has been delivered
in writing by the Borrower or any of the Guarantors to the Agent or to the
Bankruptcy Court in connection with any Loan Document, and any financial
statement delivered pursuant
39
hereto or thereto (other than to the extent that any such statements constitute
projections), taken as a whole and in light of the circumstances in which made,
contains no untrue statement of a material fact and does not omit to state a
material fact necessary to make such statements not misleading; and, to the
extent that any such information constitutes projections, such projections were
prepared in good faith on the basis of assumptions, methods, data, tests and
information believed by the Borrower or such Guarantor to be reasonable at the
time such projections were furnished.
SECTION 3.04. Financial Statements. The Borrower has furnished the DIP
Lenders with copies of (i) the audited consolidated financial statement and
schedules of the Borrower for the fiscal year ended December 31, 2000 and (ii)
the unaudited consolidated financial statement and schedules of the Borrower for
the fiscal quarter ended September 30, 2001. Such financial statements present
fairly in all material respects (and subject in the case of clause (ii), to the
absence of footnotes and to normal year-end adjustments) the financial condition
and results of operations of the Borrower and its Subsidiaries on a consolidated
basis as of such dates and for such periods; such balance sheets and the notes
thereto disclose all liabilities, direct or contingent, of the Borrower and its
Subsidiaries as of the dates thereof required to be disclosed by GAAP and such
financial statements were prepared in a manner consistent with GAAP, subject (in
the case of such fiscal quarter statement) to normal year end adjustments. No
material adverse change in the operations, business, properties, assets,
prospects or condition (financial or otherwise) of the Borrower and its
Subsidiaries, taken as a whole, has occurred since September 30, 2001 other than
those which customarily occur as a result of events leading up to and following
the commencement of a proceeding under chapter 11 of the Bankruptcy Code and the
commencement of the Cases (including, without limitation, those reflected in the
financial projections heretofore made available to the Agent).
SECTION 3.05. Ownership. Each of the Persons listed on Schedule 3.05 is
a direct or indirect Subsidiary of the Borrower, and, except as indicated on
Schedule 3.05, each such Person is a wholly-owned Subsidiary of the Borrower.
The Borrower owns no other Subsidiaries, whether directly or indirectly, other
than as set forth on Schedule 3.05.
SECTION 3.06. Liens. There are no Liens of any nature whatsoever on any
assets of the Borrower or any of the Guarantors other than: (i) Liens granted
pursuant to the Pre-Petition Credit Agreement; (ii) Permitted Liens; (iii) Liens
permitted pursuant to section 6.01; (iv) Liens in favor of the Agent and the DIP
Lenders and (v) Liens existing on the Petition Date and permitted to exist
pursuant to the Pre-Petition Credit Agreement (which Liens shall be identified
on Schedule 3.06 hereto). Neither the Borrower nor any of the Guarantors is a
party to any contract, agreement, lease or instrument the performance of which,
either unconditionally or upon the happening of an event, will result in or
require the creation of a Lien on any assets of the Borrower or any Guarantor or
otherwise result in a violation of this Agreement other than the Liens granted
to the Agent and the DIP Lenders as provided for in this Agreement.
40
SECTION 3.07. Compliance with Law. (a) (i) The operations of the
Borrower and the Guarantors comply in all material respects with all applicable
environmental, health and safety statutes and regulations, including, without
limitation, regulations promulgated under the Resource Conservation and Recovery
Act (42 U.S.C.ss.ss.6901 et seq.); (ii) none of the operations of the Borrower
or the Guarantors is the subject of any Federal or state investigation
evaluating whether any remedial action involving a material expenditure by the
Borrower or any Guarantor is needed to respond to a release of any Hazardous
Waste or Hazardous Substance (as such terms are defined in any applicable state
or Federal environmental law or regulations) into the environment; and (iii)
neither the Borrower nor any Guarantor has any material contingent liability in
connection with any release of any Hazardous Waste or Hazardous Substance into
the environment.
(b) Neither the Borrower nor any Guarantor is in violation of any
law, rule or regulation, or in default with respect to any judgment, writ,
injunction or decree of any Governmental Authority the violation of which, or a
default with respect to which, would have a material adverse effect on the
financial condition, operations, business, properties or assets of the Borrower
and the Guarantors, taken as a whole.
SECTION 3.08. Insurance. All policies of insurance of any kind or
nature owned by or issued to the Borrower and the Guarantors, including, without
limitation, policies of life, fire, theft, product liability, public liability,
property damage, other casualty, employee fidelity, workers' compensation,
employee health and welfare, title, property and liability insurance, are in
full force and effect and are of a nature and provide such coverage as is
customarily carried by companies of the size and character of the Borrower and
the Guarantors.
SECTION 3.09. The Orders. On the date of the making of the initial
Loans or the issuance of the initial Letters of Credit hereunder, whichever
first occurs, the Interim Order will have been entered and will not have been
stayed, amended, vacated, reversed or rescinded. On the date of the making of
any Loan or issuance of any Letter of Credit, the Interim Order or the Final
Order, as the case may be, will have been entered and will not have been
amended, stayed, vacated or rescinded. Upon the maturity (whether by the
acceleration or otherwise) of any of the obligations of the Borrower and the
Guarantors hereunder and under the other Loan Documents, the DIP Lenders shall,
subject to the provisions of Section 7.01, be entitled to immediate payment of
such obligations, and to enforce the remedies provided for hereunder, without
further application to or order by the Bankruptcy Court.
SECTION 3.10. Use of Proceeds. Subject to compliance with the Orders
and the other provisions of this Agreement, the proceeds of the Loans shall be
used for working capital and for other general corporate purposes of the
Borrower and the Guarantors.
SECTION 3.11. Litigation. Other than as set forth on Schedule 3.11,
there are no unstayed actions, suits or proceedings pending or, to the best
knowledge of the Borrower
41
or the Guarantors, threatened against or affecting the Borrower or the
Guarantors or any of their respective properties, before any court or
governmental department, commission, board, bureau, agency or instrumentality,
domestic or foreign, that are reasonably likely to be determined adversely to
the Borrower or the Guarantors and, if so adversely determined, would have a
material adverse effect on the financial condition, business, properties,
prospects, operations or assets of the Borrower and the Guarantors, taken as a
whole.
SECTION 3.12. Intellectual Property. Set forth on Schedule 3.12 hereto
is a complete and accurate list of all patents, patent applications, trademarks,
trademark applications, trade names, service marks and copyrights, and all
applications therefor and licenses thereof, of the Borrower and each Guarantor
(the "INTELLECTUAL PROPERTY"), showing as of the date hereof the jurisdiction in
which registered, the registration number, the date of registration and the
expiration date. Except as described on Schedule 3.12, no claim has been
asserted and is pending by any Person challenging or questioning the use of any
such Intellectual Property or the validity or effectiveness of any such
Intellectual Property, nor does the Borrower or any Guarantor know of any such
claim, and, to the knowledge of the Borrower and each Guarantor, the use of such
Intellectual Property by the Borrower and the Guarantors does not infringe on
the rights of any Person, except for such claims and infringement that, in the
aggregate, would not be reasonably expected to have a material adverse effect on
the financial condition, business, properties, prospects, operations or assets
of the Borrower and the Guarantors, taken as a whole.
SECTION 3.13. Letters of Credit. Letters of Credit issued hereunder
will be used only for the purposes permitted hereby and by the Orders.
SECTION 3.14. Pre-Petition Indebtedness. Set forth on Schedule 3.14
hereto is a complete and accurate list of all Pre-Petition Indebtedness of the
Borrower and each Guarantor (in each case identified as a Low Leverage or High
Leverage Guarantor), showing as of the date hereof the obligor or obligors and
the principal amount outstanding thereunder.
SECTION 3.15. Properties. Set forth on Schedule 3.15 hereto is a
complete and accurate list of all real property owned by the Borrower or each
Guarantor (in each case identified as a Low Leverage or High Leverage Guarantor)
as of the date hereof, showing the street address, county or other relevant
jurisdiction, state and record owner thereof and clearly identifying each
property that is a "Low Leverage Hotel Property" and the Attributed DIP
Percentage and Attributed DIP Amount for such Low Leverage Hotel Property.
Except as set forth on Schedule 3.15, each Borrower or such Guarantor has good,
marketable and insurable fee simple title to such real property, free and clear
of all Liens, other than Liens created or permitted hereby.
SECTION 3.16. Leases. Set forth on Schedule 3.16 hereto is a complete
and accurate list of all leases of real property under which the Borrower or
each Guarantor (in
42
each case identified as a Low Leverage or High Leverage Guarantor) is the
lessee, as of the date hereof, showing the street address, county or other
relevant jurisdiction, state, lessor, lessee, expiration date and annual rental
cost thereof. Except as set forth on Schedule 3.16 hereto, each such lease is
the legal, valid and binding obligation of the lessor thereof, enforceable in
accordance with its terms.
SECTION 3.17. Investments. Set forth on Schedule 3.17 hereto is a
complete and accurate list of all deposit accounts or securities accounts
maintained by the Borrower and each Guarantor (identified in each case as a Low
Leverage or High Leverage Guarantor) and of all Investments in excess of
$1,000,000 held by the Borrower or such Guarantors on the date hereof, showing
the amount, obligor or issuer and maturity, if any, thereof.
ARTICLE 4
CONDITIONS OF LENDING
SECTION 4.01. Conditions Precedent to Closing and Extension of Initial
Loans and Initial Letters of Credit. The occurrence of the Closing Date and
obligation of the DIP Lenders to make the initial Loans or the Fronting Banks to
issue the initial Letters of Credit, whichever may occur first, is subject to
the following conditions precedent:
(a) Supporting Documents. The Agent shall have received:
(i) a copy of the Borrower's certificate of
incorporation, as amended up to and including the Closing Date,
certified as of a recent date by the Secretary of State (or other
applicable Governmental Authority) of the jurisdiction of the
Borrower's incorporation; provided that the Agent may, in its
discretion, accept such certificate of incorporation of the Borrower
certified by a Secretary or Assistant Secretary of the Borrower in lieu
of certification by the Secretary of State (or other applicable
Governmental Authority), subject to receipt of an undertaking from the
Borrower to effect delivery of such documents certified by the
Secretary of State (or other applicable Governmental Authority)
promptly after the Closing Date;
(ii) a certificate of the Secretary of State (or other
applicable Governmental Authority) of the Borrower's jurisdiction of
incorporation, dated as of a recent date, as to the good standing of
the Borrower and as to the charter documents on file in the office of
such Secretary of State (or other applicable Governmental Authority);
(iii) a certificate of the Secretary or an Assistant
Secretary of the Borrower dated as of the Closing Date and certifying
(A) that attached thereto is a true and complete copy of the by-laws of
the Borrower as in effect on the date of such certification, (B) that
attached thereto is a true and complete copy of resolutions adopted by
the Board of Directors of the Borrower authorizing the
43
Borrowings and Letter of Credit extensions hereunder, the execution,
delivery and performance in accordance with their respective terms of
this Agreement, the Loan Documents and any other documents required or
contemplated hereunder or thereunder and the granting of the security
interest in the Letter of Credit Account and other Liens contemplated
hereby, and that such resolutions are in full force and effect without
modification or amendment, (C) that the certificate of incorporation of
the Borrower has not been amended since the date of the last amendment
thereto indicated on the certificate furnished pursuant to clause (i)
above and (D) as to the incumbency and specimen signature of each
officer of the Borrower executing this Agreement or any other Loan
Documents or any other document delivered by it in connection herewith
or therewith (such certificate to contain a certification by another
officer of such entity as to the incumbency and signature of the
officer signing the certificate referred to in this clause (iii)); and
(iv) such other documents as the Agent may reasonably
request.
(b) Interim Order. At the time of the making of the initial Loans
or at the time of the issuance of the initial Letters of Credit, whichever first
occurs, the Agent and the DIP Lenders shall have received a certified copy of an
order of the Bankruptcy Court in substantially the form of Exhibit C (the
"INTERIM ORDEr") approving the Loan Documents and granting the Superpriority
Claim status and senior priming and other Liens described in Section 2.23 which
Interim Order (i) shall have been entered, upon an application or motion of the
Borrower reasonably satisfactory in form and substance to the Agent, on such
prior notice to such parties (including the Pre-Petition Lenders) as may in each
case be reasonably satisfactory to the Agent, (ii) shall authorize extensions of
credit in amounts satisfactory to the Agent, (iii) shall approve the payment by
the Borrower of all of the Fees referred to in Section 2.19, 2.20 and 2.21, (iv)
shall be in full force and effect, (v) shall have authorized the use by the
Borrower and the Guarantors of any cash collateral which constitutes a Primed
Asset and shall have provided, as adequate protection for the use of such cash
collateral and the priming contemplated hereby, for (A) a Superpriority Claim as
contemplated by Section 507(b) of the Bankruptcy Code immediately junior to the
claims under Section 364(c)(1) of the Bankruptcy Code held by the Agent and the
DIP Lenders, (B) a Lien on substantially all of the assets of the Borrower and
the Guarantors that are subject to the Cases (other than Impac Hotels II, L.L.C.
and Impac Hotels III, L.L.C.) having a priority junior to the priming Liens
granted in favor of the Agent and the DIP Lenders hereunder and under the other
Loan Documents with respect to the Primed Assets and immediately junior to
pre-existing Liens (if any), (C) the payment on a current basis of the
reasonable fees and disbursements of respective professionals (including, but
not limited to, the reasonable fees and disbursements of counsel and internal
and third-party consultants, including financial consultants, real estate
appraisers, and auditors) for the Pre-Petition Agent (including the payment on
the Closing Date or as soon thereafter as is practicable of any unpaid
pre-petition fees and expenses) and the continuation of the payment to the
Pre-Petition Agent on a current basis of the administration fees that are
provided for under the
44
Pre-Petition Credit Agreement and (E) the payment to the Pre-Petition Lenders
(to be applied as provided for in the Pre-Petition Credit Agreement) and the
other Primed Lenders of the Net Proceeds of the sale of assets on which they
have Liens to the extent such Net Proceeds are not required to be paid to the
Agent and the DIP Lenders hereunder (such payments to the Pre-Petition Lenders
to be made each time that cumulative Net Proceeds that are so payable, but have
not yet been paid, reach $100,000) and (vi) shall not have been stayed,
reversed, modified or amended in any respect; and, if the Interim Order is the
subject of a pending appeal in any respect, neither the making of such Loans nor
the issuance of such Letter of Credit nor the performance by the Borrower or any
of the Guarantors of any of their respective obligations hereunder or under the
Loan Documents or under any other instrument or agreement referred to herein
shall be the subject of a presently effective stay pending appeal.
(c) Security and Pledge Agreement. The Borrower and each of the
Guarantors (other than Impac Hotels II, L.L.C. and Impac Hotels III, L.L.C.)
shall have duly executed and delivered to the Agent a Security and Pledge
Agreement in substantially the form of Exhibit D (the "SECURITY AND PLEDGE
AGREEMENT") and each of the documents contemplated thereunder that is to be
delivered prior to the extension of the initial Loans or issuance of the initial
Letters of Credit hereunder (including, without limitation, all such patent,
trademark and copyright security agreements or other filings as requested by the
Agent in order to perfect the Agent's security interest in intellectual property
of the Borrower and the Guarantors).
(d) First Day Orders. All of the "first day orders" entered by the
Bankruptcy Court at the time of the commencement of the Cases shall be
satisfactory in form and substance to the Agent.
(e) Opinion of Counsel. Unless the Agent shall have agreed that
the condition set forth in this Section 4.01(e) may be satisfied at the time of
the entry of the Final Order, the Agent and the DIP Lenders shall have received
the favorable written opinion of counsel to the Borrower and the Guarantors,
dated the Closing Date substantially in the form of Exhibit E and reasonably
acceptable to the Agent.
(f) Payment of Fees. The Borrower shall have paid to the Agent the
then unpaid balance of all accrued and unpaid Fees due under and pursuant to
this Agreement and the letter referred to in Section 2.19.
(g) Corporate and Judicial Proceedings. All corporate, judicial
and other proceedings and all instruments and agreements in connection with the
transactions among the Borrower, the Guarantors, the Agent and the DIP Lenders
contemplated by this Agreement shall be satisfactory in form and substance to
the Agent, and the Agent shall have received all information and copies of all
documents and papers, including records of corporate, judicial and other
proceedings, which the Agent may have requested
45
in connection therewith, such documents and papers where appropriate to be
certified by proper corporate, governmental or judicial or other authorities.
(h) Information. The Agent shall have received such information
(financial or otherwise) as may be reasonably requested by the Agent and shall
have discussed such information (as well as the Borrower's business plan and
Budget delivered to the Agent prior to the Closing Date) with the Borrower's
management and shall be satisfied with the nature and substance of such
discussions.
(i) Budget. The Agent and the DIP Lenders shall have received from
the Borrower a forecast detailing the anticipated cash receipts and
disbursements of the Borrower and the Low Leverage Guarantors, as a group, and
the High Leverage Guarantors, as a group, in each case for the period commencing
on or prior to the Petition Date and ending on or after the Maturity Date and
setting forth the anticipated uses of the Total Commitment (as amended from time
to time with the consent of the Co-Arrangers, the "BUDGET"), all on a monthly
basis, satisfactory in form and substance to the Co-Arrangers.
(j) Compliance with Laws. The Borrower and the Guarantors shall
have granted the Agent access to and the right to inspect all reports, audits
and other internal information of the Borrower and the Guarantors relating to
environmental matters, and any third party verification of certain matters
relating to compliance with environmental laws and regulations requested by the
Agent, and the Agent shall be reasonably satisfied that the Borrower and the
Guarantors are in compliance in all material respects with all applicable
environmental laws and regulations and be satisfied with the costs of
maintaining such compliance.
(k) Management Agreements. The Agent shall be satisfied that the
Borrower has entered into arrangements that are reflected in the Orders with
each Guarantor that owns a hotel property, unless the assets of such Guarantor
are Primed Assets, providing appropriate payments to the Borrower for services
rendered to, and expenses paid on behalf of, such Guarantor (including payment
of allocated overhead and restructuring expenses and reasonable provision for
capital expenditures) and such management arrangements that are reflected in the
Orders shall be in form and substance satisfactory to the Agent.
SECTION 4.02. Conditions Precedent to Each Loan and Each Letter of
Credit. The obligation of the DIP Lenders to make each Loan and of the Fronting
Bank to issue each Letter of Credit, including the initial Loan and the initial
Letter of Credit, is subject to the following conditions precedent:
(a) Notice. The Agent shall have received a notice with respect to
such borrowing or issuance, as the case may be, as required by Section 2.
46
(b) Representations and Warranties. All representations and
warranties contained in this Agreement and the other Loan Documents shall be
true and correct in all material respects on and as of the date of each
Borrowing or the issuance of each Letter of Credit hereunder with the same
effect as if made on and as of such date except to the extent such
representations and warranties expressly relate to an earlier date.
(c) No Default. On the date of each Borrowing hereunder or the
issuance of each Letter of Credit, no Event of Default or event which upon
notice or lapse of time or both would constitute an Event of Default shall have
occurred and be continuing.
(d) Orders. The Interim Order shall be in full force and effect
and shall not have been stayed, reversed, modified or amended in any respect
without the prior written consent of the Agent and the Required DIP Lenders,
provided, that at the time of the making of any Loan or the issuance of any
Letter of Credit the aggregate amount of either or which, when added to the sum
of the principal amount of all Loans then outstanding and the Letter of Credit
Outstandings, would exceed the amount authorized by the Interim Order
(collectively, the "ADDITIONAL CREDIT"), the Agent and each of the DIP Lenders
shall have received a certified copy of an order of the Bankruptcy Court in form
and substance satisfactory to the Co-Arrangers in their sole discretion (the
"FINAL ORDER"), which, in any event, shall have been entered by the Bankruptcy
Court no later than 30 days after the entry of the Interim Order, and at the
time of the extension of any Additional Credit the Final Order shall be in full
force and effect, and shall not have been stayed, reversed, modified or amended
in any respect without the prior written consent of the Agent and the Required
DIP Lenders; and if either the Interim Order or the Final Order is the subject
of a pending appeal in any respect, neither the making of the Loans nor the
issuance of any Letter of Credit nor the performance by the Borrower or any
Guarantor of any of their respective obligations under any of the Loan Documents
shall be the subject of a presently effective stay pending appeal.
(e) Payment of Fees. The Borrower shall have paid to the Agent the
then unpaid balance of all accrued and unpaid Fees then payable under and
pursuant to this Agreement and the letter referred to in Section 2.19.
(f) UCC Searches; Opinions of Counsel; Repayment of Certain
Advances. At the time of the making of the first Loan or the issuance of the
first Letter of Credit following the entry of the Final Order, the Agent shall
have received (i) UCC searches conducted in the jurisdictions in which the
Borrower and the Guarantors conduct business (dated as of a date reasonably
satisfactory to the Agent), reflecting the absence of Liens and encumbrances on
the assets of the Borrower and the Guarantors other than such Liens permitted by
Section 6.01, (ii) to the extent requested at least 10 days in advance by the
Agent, opinions of local counsel covering matters not covered in the opinion of
counsel delivered pursuant to Section 4.01(e) in form and substance reasonably
satisfactory to the Agent and (iii) evidence satisfactory to the Agent that all
outstanding advances made on or after the Closing Date by the Borrower or any
Low Leverage Guarantor to any High
47
Leverage Guarantor have been held or stipulated to be costs or expenses
recoverable by such High Leverage Guarantor under Section 506(c) of the
Bankruptcy Code.
(g) Usage. The uses of such Borrowing or such Letter of Credit
shall be consistent with the Budget and Section 3.10 of this Agreement.
The request by the Borrower for, and the acceptance by the Borrower
of, each extension of credit hereunder shall be deemed to be a representation
and warranty by the Borrower that the conditions specified in this Section
have been satisfied or waived at that time.
ARTICLE 5
AFFIRMATIVE COVENANTS
From the date hereof and for so long as any Commitment shall be in
effect or any Letter of Credit shall remain outstanding (in a face amount in
excess of the amount of cash then held in the Letter of Credit Account, or in
excess of the face amount of back-to-back letters of credit delivered, in each
case pursuant to Section 2.03(b)), or any amount shall remain outstanding or
unpaid under this Agreement, the Borrower and each of the Guarantors agree
that, unless the Required DIP Lenders shall otherwise consent in writing, the
Borrower and each of the Guarantors will:
SECTION 5.01. Financial Statements, Reports, Etc. In the case of the
Borrower and the Guarantors, deliver to the Agent and each of the DIP Lenders:
(a) within 90 days after the end of each fiscal year, the
Borrower's consolidated balance sheet and related statement of income and cash
flows, showing the financial condition of the Borrower and its Subsidiaries on a
consolidated basis, as of the close of such fiscal year and the results of their
respective operations during such year, the consolidated statement of the
Borrower to be audited for the Borrower and its Subsidiaries by Arthur Andersen
or other independent public accountants or recognized national standing
acceptable to the Required DIP Lenders and accompanied by an opinion of such
accountants (which shall not be qualified in any material respect other than
with respect to the Cases) and to be certified by a Financial Officer of the
Borrower to the effect that such consolidated financial statements fairly
present in all material respects the financial condition and results of
operations of the Borrower and its Subsidiaries on a consolidated basis in
accordance with GAAP consistently applied;
(b) within 45 days after the end of each of the first three fiscal
quarters, the Borrower's consolidated balance sheets and related statements of
income and cash flows, showing the financial condition of the Borrower and its
Subsidiaries on a consolidated basis as of the close of such fiscal quarter and
the results of their operations during such fiscal quarter and the then elapsed
portion of the fiscal year, each certified by a Financial
48
Officer of the Borrower as fairly presenting in all material respects the
financial condition and results of operations of the Borrower and its
Subsidiaries on a consolidated basis in accordance with GAAP consistently
applied, subject to the absence of footnotes and normal year-end audit
adjustments;
(c) concurrently with any delivery of financial statements under
(a) or (b) above as applicable, (i) a certificate of a Financial Officer (A)
certifying that no Event of Default or event that upon notice or lapse of time
or both would constitute an Event of Default has occurred, or, if such an Event
of Default or event has occurred, specifying the nature and extent thereof and
any corrective action taken or proposed to be taken with respect thereto and (B)
setting forth computations in reasonable detail satisfactory to the Agent
demonstrating compliance with the provisions of Sections 6.04, 6.05 and 6.10 and
(ii) a certificate (which certificate may be limited to accounting matters and
disclaim responsibility for legal interpretations) of such accountants
accompanying the audited consolidated financial statements delivered under (a)
above certifying that, in the course of the regular audit of the business of the
Borrower and its Subsidiaries, such accountants have obtained no knowledge that
an Event of Default has occurred and its continuing, or if, in the opinion of
such accountants, an Event of Default has occurred and is continuing, specifying
the nature thereof and all relevant facts with respect thereto;
(d) as soon as available, but no more than 45 days after the end
of each month, the unaudited monthly cash flow reports of the Borrower and its
Subsidiaries on a consolidated basis as of the close of such fiscal month and
the results of their operations during such fiscal period and the then elapsed
portion of the fiscal year, all certified by a Financial Officer as fairly
presenting in all material respects the results of operations of the Borrower
and the Guarantors on a consolidated basis, subject to the absence of footnotes
and normal year-end audit adjustments;
(e) within five Business Days of the first of each month, a
statement of projected cash receipts and cash disbursements for each of the
Borrower and the Low Leverage Guarantors, as a group and High Leverage
Guarantors as a group, respectively, for each month in the period of six
continuous months commencing with that month in a form reasonably satisfactory
to the Agent;
(f) weekly "cash flow" reports in a form reasonably satisfactory
to the Agent (which shall include a summary of all outstanding loans or advances
made in reliance on Section 6.10(vi));
(g) promptly after the same become publicly available, copies of
all periodic and other reports, proxy statements and other materials filed by it
with the Securities and Exchange Commission, or any governmental authority
succeeding to any of or all of the functions of said commission, or with any
national securities exchange, as the case may be;
49
(h) as soon as available and in any event (A) within 30 days after
the Borrower or any of its ERISA Affiliates knows or has reason to know that any
Termination Event described in clause (i) of the definition of Termination Event
with respect to any Single Employer Plan of the Borrower or such ERISA Affiliate
has occurred and (B) within 10 days after the Borrower or any of its ERISA
Affiliates knows or has reason to know that any other Termination Event with
respect to any such Plan has occurred, a statement of a Financial Officer of the
Borrower describing such Termination Event and the action, if any, which the
Borrower or such ERISA Affiliate proposes to take with respect thereto;
(i) promptly and in any event within 10 days after receipt thereof
by the Borrower or any of its ERISA Affiliates from the PBGC copies of each
notice received by the Borrower or any such ERISA Affiliate of the PBGC's
intention to terminate any Single Employer Plan of the Borrower or such ERISA
Affiliate or to have a trustee appointed to administer any such Plan;
(j) if requested by the Agent, promptly, and in any event within
30 days after the filing thereof, copies of each Schedule B (Actuarial
Information) to the annual report (Form 5500 Series) with respect to each Single
Employer Plan of the borrower or any of its ERISA Affiliates;
(k) within 10 days after notice is given or required to be given
to the PBGC under Section 302(f)(4)(A) of ERISA of the failure of the Borrower
or any of its ERISA Affiliates to make timely payments to a Plan, a copy of any
such notice filed and a statement of a Financial Officer of the Borrower setting
forth (A) sufficient information necessary to determine the amount of the lien
under Section 302(f)(3), (B) the reason for the failure to make the required
payments and (C) the action, if any, which the Borrower or any of its ERISA
Affiliates proposed to take with respect thereto;
(l) promptly and in any event within 10 days after receipt thereof
by the Borrower or any ERISA Affiliate from a Multiemployer Plan sponsor, a copy
of each notice received by the Borrower or any ERISA Affiliate concerning (A)
the imposition of Withdrawal Liability by a Multiemployer Plan, (B) the
determination that a Multiemployer Plan is, or is expected to be, in
reorganization within the meaning of Title IV of ERISA, (C) the termination of a
Multiemployer Plan within the meaning of Title IV of ERISA, or (D) the amount of
liability incurred, or which may be incurred, by the Borrower or any ERISA
Affiliate in connection with any event described in clause (A), (B) or (C)
above;
(m) promptly, from time to time, such other information regarding
the operations, business affairs and financial condition of the Borrower or any
Guarantor, or compliance with the terms of any material loan or financing
agreements as the Agent, at the request of any DIP Lender, may reasonably
request;
50
(n) promptly after the same is available, copies of all pleadings,
motions, applications, judicial information, financial information and other
documents filed by or on behalf of the Borrower or any of the Guarantors with
the Bankruptcy Court in the Cases, or distributed by or on behalf of the
Borrower or any of the Guarantors to any official committee appointed in the
Cases, providing copies of same to counsel for the Agent, except if such
distribution would destroy attorney-client privilege; and
(o) no later than the 35 th day after the end of each fiscal
calender month of the Borrower, a reconciliation of the results of the business
operations of the Borrower and the Low Leverage Guarantors (as a group) and the
High Leverage Guarantors (as a group) for such fiscal calender month as compared
to the corresponding period in the Budget (clearly distinguishing between Low
Leverage, as a group and High Leverage Guarantors, as a group).
SECTION 5.02. Corporate Existence. Preserve and maintain in full force
and effect all governmental rights, privileges, qualification, permits, licenses
and franchises necessary or desirable in the normal conduct of its business
except (i) (A) if in the reasonable business judgment of the Borrower or such
Guarantor, as the case may be, it is in its best interest not to preserve and
maintain such rights, privileges, qualifications, permits, licenses and
franchises, and (B) such failure to preserve the same could not, in the
aggregate, reasonably be expected to have a material adverse effect on the
operations, business, properties, assets, prospects or condition (financial or
otherwise) of the Borrower and the Guarantors, taken as a whole, and (ii) as
otherwise permitted in connection with sales of assets permitted by Section
6.11.
SECTION 5.03. Insurance. (a) Keep its insurable properties insured at
all times, against such risks, including fire and other risks insured against by
extended coverage, as is customary with companies of the same or similar size in
the same or similar businesses; and maintain in full force and effect public
liability insurance against claims for personal injury or death or property
damage occurring upon, in, about or in connection with the use of any properties
owned, occupied or controlled by the Borrower or any Guarantor, as the case may
be, in such amounts and with such deductibles as are customary with companies of
the same or similar size in the same or similar businesses, in the same
geographic area and similarly situated; and (b) maintain such other insurance or
self insurance as may be required by law.
SECTION 5.04. Obligations and Taxes. With respect to the Borrower and
each Guarantor, pay all its material obligations arising after the Petition Date
promptly and in accordance with their terms and pay and discharge promptly all
material taxes, assessments and governmental charges or levies imposed upon it
or upon its income or profits or in respect of its property arising after the
Petition Date, before the same shall become in default, as well as all material
lawful claims for labor, materials and supplies or otherwise, arising after the
Petition Date which, if unpaid, would become a Lien or
51
charge (except that advances and loans made to High Leverage Guarantors by the
Borrower or Low Leverage Guarantors may have the benefit of a Lien or charge
pursuant to Section 506(c) of the Bankruptcy Code) upon such properties or any
part thereof; provided, however, that the Borrower and each Guarantor shall not
be required to pay and discharge or to cause to be paid and discharged any such
obligation, tax, assessment, charge, levy or claim so long as the validity or
amount thereof shall be contested in good faith by appropriate proceedings (if
the Borrower and the Guarantors shall have set aside on their books adequate
reserves therefor in conformity with GAAP).
SECTION 5.05. Notice of Event of Default, etc. Within three Business
Days thereof, give to the Agent notice in writing of (a) any Event of Default or
the occurrence of any event or circumstance that with the passage of time or
giving of notice or both would constitute an Event of Default and (b) any
litigation, investigations or proceedings which may exist at any time between
the Borrower or any Guarantor and any Governmental Authority.
SECTION 5.06. Access to Books and Records. (a) Maintain or cause to be
maintained at all times true and complete books and records in accordance with
GAAP of the financial operations of the Borrower and its Subsidiaries on a
consolidated basis, and the operating results on a Guarantor by Guarantor basis;
and upon reasonable notice provide the Agent and its representatives access to
all such books and records during regular business hours, in order that the
Agent may examine and make abstracts from such books, accounts, records and
other papers for the purpose of verifying the accuracy of the various reports
delivered by the Borrower or the Guarantors to the Agent or the DIP Lenders
pursuant to this Agreement or for otherwise ascertaining compliance with this
Agreement. The Borrower and each Guarantor will, at any reasonable time and from
time to time during regular business hours, upon reasonable notice, permit the
Agent and any agents or representatives (including, without limitation,
appraisers) designated by the Agent to visit the properties of the Borrower and
the Guarantors and to conduct examinations of and to monitor the Collateral held
by the Agent and to discuss the affairs, finances and condition of the Borrower
and the Guarantors with the officers and independent accountants of the
Borrower.
(b) The Borrower and the Guarantors will permit any
representatives designated by the Agent (including any consultants, accountants,
lawyers and appraisers retained by the Agent) to conduct evaluations and
appraisals of the Borrower's computation of the Primed Assets, all at such
reasonable times and as often as reasonably requested. The Borrower shall pay
the reasonable fees (including reasonable and customary internally allocated
fees of employees of the Agent as to which invoices have been furnished) and
expenses of any such representatives retained by the Agent as to which invoices
have been furnished to conduct any such evaluation or appraisal, including the
reasonable fees and expenses associated with collateral monitoring services
performed by the Agent.
52
(c) The Borrower and the Guarantors will grant the Agent access to
and the right to inspect all reports, audits and other internal information of
the Borrower and the Guarantors relating to environmental matters upon
reasonable notice, and obtain any third party verification of matters relating
to compliance with environmental laws and regulations requested by the Agent at
any time and from time to time.
SECTION 5.07. Maintenance of Concentration Account. The Borrower and
the Guarantors shall, within 30 days after the Closing Date, and at all times
thereafter, maintain with the Agent (or another depository bank or financial
institution satisfactory to the Agent) an account or accounts (the
"CONCENTRATION ACCOUNT") (a) to be used by the Borrower and the Guarantors as
their principal concentration accounts and (b) except as otherwise provided in
an Order, into which shall be swept or deposited, at the end of each Business
Day, all cash of the Borrower and the Guarantors and the full available balances
in excess of an aggregate of $250,000 in all of the operating and other bank
accounts of the Borrower and the Guarantors maintained at any institution other
than in the Concentration Account.
SECTION 5.08. Budget. The Borrower shall, and shall cause each of the
Guarantors to, comply with the Orders and the Budget and shall not permit any of
the Guarantors to, make any Pre-Petition Payment, except as permitted by the
Orders and except as authorized by the Bankruptcy Court (i) in "first day
orders" approved by the Agent (including to pay pre-petition trust fund taxes
reflected in the Budget) and (ii) to pay lease payments reflected in the Budget
in respect of Capital Leases constituting Pre-Petition Indebtedness.
SECTION 5.09. Furnishing of Additional Items. In the case of the
Borrower and the Guarantors, deliver to the Agent:
(a) within 20 days after the date hereof, (i) a copy of each such
entity's certificate of incorporation, as amended up to and including the
Closing Date, certified as of a recent date by the Secretary of State (or other
applicable Governmental Authority) of the jurisdiction of such entity's
incorporation, (ii) a certificate of such Secretary of State (or other
applicable Governmental Authority) of each such entity's jurisdiction of
incorporation, dated as of a recent date, as to the good standing of such entity
and as to the charter documents on file in the office of such Secretary of State
(or other applicable Governmental Authority), and (iii) a certificate of the
Secretary or an Assistant Secretary of each such entity dated as of a recent
date and certifying (A) that attached thereto is a true and complete copy of the
by-laws of such entity as in effect on the date of such certification, (B) that
attached thereto is a true and complete copy of resolutions adopted by the Board
of Directors of such entity authorizing the Borrowings and Letter of Credit
extensions hereunder, the execution, delivery and performance in accordance with
their respective terms of this Agreement, the Loan Documents and any other
documents required or contemplated hereunder or thereunder and the granting of
the security interest
53
in the Letter of Credit Account and other Liens contemplated hereby, and that
such resolutions are in full force and effect without modification or amendment,
(C) that the certificate of incorporation of such entity has not been amended
since the date of the last amendment thereto indicated on the certificate of the
Secretary of State furnished pursuant to clause (i) above and (D) as to the
incumbency and specimen signature of each officer of such entity executing this
Agreement or any other Loan Documents or any other document delivered by it in
connection herewith or therewith (such certificate to contain a certification by
another officer of such entity as to the incumbency and signature of the officer
signing the certificate referred to in this clause (iii));
(b) within 20 days after the date hereof, (i) a certificate of the
Secretary of State (or other applicable Governmental Authority) of each such
entity's jurisdiction of incorporation, each dated as of a recent date, as to
the payment of taxes by such entity and (ii) a certificate of the Secretary of
State (or other applicable Governmental Authority) of each other jurisdiction in
which such entity is qualified to do business as a foreign corporation, each
dated as of a recent date, as to the good standing of and payment of taxes by
such entity; provided that, in the case of jurisdictions in which any of the
Borrower or the Guarantors is qualified to do business as a foreign corporation,
the Agent may, in its discretion, accept a certificate of a Secretary or
Assistant Secretary of the Borrower as to the good standing and payment of taxes
by such entity, in lieu of certification by the Secretary of State (or other
applicable Governmental Authority);
(c) within 20 days after the date hereof (or in the case of Impac
Hotels II, L.L.C. and Impac Hotels III, L.L.C., no later than the day of the
Final Order), (i) executed UCC financing statements naming each of the Borrower
and the Guarantors as debtor in substantially the form of Schedule D-6 to
Exhibit D to the Security and Pledge Agreement, in each case in appropriate form
for filing in the UCC filing offices set forth in paragraph 2 of the Perfection
Certificate with respect to each of the Borrower and the Guarantors, (ii) such
other financing statements, security agreements or documents as the Agent may
reasonably request, in order to perfect any security interest granted or
purported to be granted under the Loan Documents to the extent such security
interest may be perfected by filing under the UCC and (iii) an updated
Perfection Certificate, substantially in the form of Exhibit D to the Security
and Pledge Agreement (and including the information contemplated by paragraphs
3, 4, 5 and 6 thereof), in each case in form and substance satisfactory to the
Agent. As used in this subsection (c), the term "UCC" has the meaning set forth
in the Security and Pledge Agreement; and
(d) within 20 days after requested by the Agent fee and leasehold
mortgages in recordable form on terms satisfactory to the Agent with respect to
the real property upon which the DIP Lenders have been granted a Lien pursuant
to the Orders and the Loan Documents.
54
ARTICLE 6
NEGATIVE COVENANTS
From the date hereof and for so long as any Commitment shall be in
effect or any Letter of Credit shall remain outstanding (in a face amount in
excess of the amount of cash then held in the Letter of Credit Account or in
excess of the face amount of back-to-back letters of credit delivered, in each
case pursuant to Section 2.03(b)) or any amount shall remain outstanding or
unpaid under this Agreement, unless the Required DIP Lenders shall otherwise
consent in writing, the Borrower and each of the Guarantors will not (and will
not apply to the Bankruptcy Court for authority to):
SECTION 6.01. Liens. Incur, create, assume or suffer to exist any Lien
on any asset of the Borrower or the Guarantors now owned or hereafter acquired
by the Borrower or any of such Guarantors, other than: (i) Liens existing on the
Petition Date as reflected on Schedule 3.06 hereto and Liens granted pursuant to
the Pre-Petition Credit Agreement; (ii) Liens constituting adequate protection
granted pursuant to the Orders, which Liens are junior to the Liens contemplated
hereby on Primed Assets in favor of the Agent and the DIP Lenders, provided that
the Interim Order and the Final Order shall provide that the holders of such
junior Liens on Primed Assets shall not be permitted to take any action to
foreclose with respect to such junior Liens so long as any amounts (including,
without limitation, any Loans or Letters of Credit) shall remain outstanding
hereunder or any Commitment shall be in effect; (iii) Permitted Liens and (iv)
Liens in favor of the Agent and the DIP Lenders.
SECTION 6.02. Merger, etc. Consolidate or merge with or into another
Person.
SECTION 6.03. Indebtedness. Contract, create, incur, assume or suffer
to exist any Indebtedness, except for (i) indebtedness under this Agreement;
(ii) Indebtedness incurred prior to the Petition Date; (iii) Indebtedness
arising from Investments among the Borrower and the Guarantors that are
permitted hereunder; (iv) Indebtedness owed to MSSF or any banking Affiliates in
respect of any overdrafts and related liabilities arising from treasury,
depository and cash management services or in connection with any automated
clearing house transfers of funds; and (v) Indebtedness consisting of guaranties
permitted by Section 6.06.
SECTION 6.04. Capital Expenditures. Make Capital Expenditures, other
than expenses incurred in connection with normal replacement and maintenance
programs properly charged to current operations to the extent that such expenses
are included in the Budget.
55
SECTION 6.05. Financial Covenants. (a) Minimum Adjusted EBITDA. Permit
cumulative Adjusted EBITDA for any period beginning on January 1, 2002 and
ending on a date listed below to be less than the amount specified opposite such
date:
Date EBITDA
---- ------
March 31, 2002 $ 12,900,000
April 30, 2002 $ 19,300,000
May 31, 2002 $ 26,700,000
June 30, 2002 $ 34,400,000
July 31, 2002 $ 41,700,000
August 31, 2002 $ 51,500,000
September 30, 2002 $ 57,600,000
October 31, 2002 $ 66,300,000
November 30, 2002 $ 70,800,000
(b) Minimum Revenue. Permit the aggregate revenue of the Low
Leverage Guarantors to be less than (i) $19,000,000 for the month of January
2002 or (ii) $20,800,000 for the month of February 2002.
(c) Maximum Corporate Overhead. Permit corporate overhead expense
(exclusive of unusual items such as Chapter 11 costs, severance expense, office
relocation expense and other items reasonably acceptable to the Co-Arrangers)
for any month to be more than the amount specified opposite such month:
Period Ending Amount
------------- ------
January 2002 $ 2,300,000
February 2002 $ 2,300,000
March 2002 $ 2,070,000
April 2002 $ 1,955,000
May 2002 $ 1,840,000
June 2002 $ 1,840,000
July 2002 $ 1,495,000
August 2002 $ 1,495,000
September 2002 $ 1,495,000
October 2002 $ 1,495,000
November 2002 $ 1,495,000
December 2002 $ 1,495,000
SECTION 6.06. Guarantees and Other Liabilities. Purchase or repurchase
(or agree, contingently or otherwise, so to do) the Indebtedness of, or assume,
guarantee (directly or indirectly or by an instrument having the effect of
assuring another's payment or performance of any obligation or capability of so
doing, or otherwise), endorse or
56
otherwise become liable, directly or indirectly, in connection with the
obligations, stock or dividends of any Person, except (i) for any guaranty of
Indebtedness or other obligations of the Borrower or any Guarantor if the
Borrower or such Guarantor could have incurred such Indebtedness or obligations
under this Agreement and (ii) by endorsement of negotiable instruments for
deposit or collection in the ordinary course of business.
SECTION 6.07. Chapter 11 Claims. Incur, create, assume, suffer to exist
or permit any other Superpriority Claim that is pari passu with or senior to the
claims of the Agent and the DIP Lenders against the Borrower and the Guarantors
that are subject to the Cases, except for the Carve-Out.
SECTION 6.08. Dividends; Capital Stock. Declare or pay, directly or
indirectly, any dividends or make any other distribution, or payment, whether in
cash, property, securities or a combination thereof, with respect to (whether by
reduction of capital or otherwise) any shares of capital stock (or any options,
warrants, rights or other equity securities or agreements relating to any
capital stock), or set apart any sum for the aforesaid purposes; provided that
any Guarantor may pay dividends to the Borrower or a Low Leverage Guarantor.
SECTION 6.09. Transactions with Affiliates. Sell or transfer any
property to, or otherwise engage in any other material transactions with, any of
its Affiliates, other than (a) in the ordinary course of business in good faith
and at prices and on terms and conditions not less favorable to the Borrower or
such Guarantor than could be obtained on an arms'-length basis from unrelated
third parties and (b) Investments in the Borrower or any Guarantor by the
Borrower or any other Guarantor consistent with the terms of the Loan Documents
and the Orders.
SECTION 6.10. Investments, Loans and Advances. Purchase, hold or
acquire any capital stock, evidences of indebtedness or other securities of,
make or permit to exist any loans or advances to (including payment of overhead
or restructuring charges allocable to any Subsidiary of the Borrower), or make
or permit to exist any investment in, any other Person (all of the foregoing,
"INVESTMENTS"), except for (i) ownership by the Borrower or the Guarantors of
the capital stock of each of the Subsidiaries listed on Schedule 3.05, (ii)
Permitted Investments, (iii) advances and loans existing on the Petition Date
and set forth on Schedule 3.17 among the Borrower and the Subsidiaries (but not
any refinancings or extensions thereof or further advances of any kind in
connection therewith; provided that the maturity of loans owing from a Low
Leverage Guarantor the assets of which constitute Primed Assets to the Borrower
may be extended (in the same amount and subject to the same terms as the
existing loan) if repayment of such loan on the original maturity date would
render such Subsidiary obligor insolvent), which have been entered into in the
ordinary course of business, (iv) Investments in the Existing Joint Ventures as
they exist on the Petition Date as described in Schedule 1.01(a); (v) advances
and loans
57
permitted by the Orders made by the Borrower or any Guarantor to the Borrower or
any Low Leverage Guarantor or by any High Leverage Guarantor to another High
Leverage Guarantor and (vi) advances and loans made on or after the Closing Date
to High Leverage Guarantors (other than Impac Hotels II, L.L.C. and Impac Hotels
III, L.L.C.) by the Borrower or Low Leverage Guarantors to cover allocated
overhead or restructuring charges and operating expenses (excluding capital
expenditures or payments of interest), but only to the extent they are held or
stipulated to be recoverable costs or expenses of such High Leverage Guarantor
under Section 506(c) of the Bankruptcy Code ("SECTION 506(C) STATUS"); provided
the aggregate amount of such advances and loans may not exceed $1,700,000 at any
time outstanding; and provided further that the Borrower and Low Leverage
Guarantors may make such advances and loans to High Leverage Guarantors prior to
the date of the Final Order that do not have Section 506(c) Status only if the
Co-Arrangers approve such loans or advances in advance and only so long as such
advances or loans are repaid in full by no later than the date that is three
months after the Final Order (unless they are given Section 506(c) Status prior
to such time). Neither the Borrower not any Guarantor shall (i) make any
advances to an Affiliate of the Borrower that is not organized under the laws of
the United States or any State thereof or the District of Columbia or (ii)
except as expressly permitted pursuant to clause (iii), (v) or (vi) of the
foregoing sentence, make any advances to or Investments in, or pay any amounts
on behalf of, any other Affiliate of the Borrower.
SECTION 6.11. Disposition of Assets. Sell or lease (as lessor) any
assets (including, without limitation, the capital stock of any Subsidiary)
except for (i) sales of surplus equipment no longer used in the businesses of
the Borrower or the Guarantors and (ii) sales of assets pursuant to an Asset
Sales Agreement and (iii) sales of assets of (or the capital stock of) any High
Leverage Guarantor, but only if all loans and advances made to such High
Leverage Guarantor by the Borrower or by Low Leverage Guarantor are repaid in
full prior to, or with the proceeds of, such sale; provided that (w) Primed
Hotel Properties may not be sold or disposed of without the consent of each
lender secured thereby unless the Net Proceeds will be sufficient (after any
prepayment of the Loans and/or cash collateralization of Letter of Credit
Outstandings required as a result of any reduction of the Total Commitment in
accordance with Section 2.13(a)) to repay the obligations to such lender secured
by such Primed Hotel Property, (x) the consideration received by the Borrower or
the relevant Guarantor shall not be less than the fair market value of the
assets sold or disposed of, (y) where required by law, the sale or disposition
shall have received the approval of the Bankruptcy Court and (z) upon receipt by
the Borrower or any Guarantor of any Net Proceeds of any sale or disposition
described in clause (ii) or (iii) hereof, the Total Commitment shall be
permanently reduced in accordance with Section 2.13(a), and the Borrower shall
prepay Loans and/or cash collateral Letters of Credit as required pursuant to,
and in the amount and order of priority set forth in, Section 2.13(b); provided
that the provisions of this Section 6.11 shall not apply to any sale or
disposition of any asset made as a result of foreclosure or other exercise of
remedies by the DIP Lenders under the Loan Documents. Nothing in this
58
Section 6.11 shall limit the transfer or disposition to the Borrower or a Low
Leverage Guarantor of assets which constitute Primed Assets.
SECTION 6.12. Nature of Business. Modify or alter in any material
manner the nature and type of its business as conducted at or prior to the
Petition Date (except as required by the Bankruptcy Code), it being understood
that sales permitted by Section 6.11 shall not constitute such a material
modification or alteration.
SECTION 6.13. Cash Management System. Except as provided in, or as
required to comply with, an Order, modify or alter in any material manner its
intercompany cash management system as existing at or prior to the Petition
Date.
ARTICLE 7
EVENTS OF DEFAULT
SECTION 7.01. Events of Default. In the case of the happening of any of
the following events and the continuance thereof beyond the applicable period of
grace if any (each, an "EVENT OF DEFAULT"):
(a) any material representation or warranty made by the Borrower
or any Guarantor in this Agreement or in any Loan Document or in connection with
this Agreement or the credit extensions hereunder or any material statement or
representation made in any report, financial statement, certificate or other
document furnished by the Borrower or any Guarantors to the DIP Lenders under or
in connection with this Agreement, shall prove to have been false or misleading
in any material respect when made or delivered; or
(b) default shall be made in the payment of any (i) Fees or
interest on the Loans or reimbursement of expenses or other amounts under any
Loan Documents when due, and such default shall continue unremedied for more
than three Business Days or (ii) principal of the Loans or reimbursement
obligations or cash collateralization in respect of Letters of Credit, when and
as the same shall become due and payable, whether at the due date thereof
(including the Prepayment Date) or at a due fixed for prepayment thereof or by
acceleration thereof or otherwise; or
(c) default shall be made by the Borrower or any Guarantor in the
due observance or performance of any covenant, condition or agreement contained
in Section 6 hereof; or
(d) default shall be made by the Borrower or any Guarantor in the
due observance or performance of any other covenant, condition or agreement to
be observed
59
or performed pursuant to the terms of this Agreement or any of the other Loan
Documents and such default shall continue unremedied for more than 30 days after
knowledge of a responsible officer of the Borrower or notice from the Agent or a
DIP Lender; or
(e) any of the Cases shall be dismissed or converted to a case
under chapter 7 of the Bankruptcy Code or the Borrower shall file a motion or
other pleading seeking the dismissal of any of the Cases under Section 1112 of
the Bankruptcy Code or otherwise; a trustee under chapter 7 or chapter 11 of the
Bankruptcy Code, a responsible officer or an examiner with enlarged powers
relating to the operation of the business (powers beyond those set forth in
Section 1106(a)(3) and (4) of the Bankruptcy Code) under Section 1106(b) of the
Bankruptcy Code shall be appointed in any of the Cases and the order appointing
such trustee, responsible officer or examiner shall not be reversed or vacated
within 30 days after the entry thereof; or an application shall be filed by the
Borrower or any Guarantor for the approval of any other Superpriority Claim
(other than the Carve-Out) in any of the Cases which is pari passu with or
senior to the claims of the Agent and the DIP Lenders against the Borrower or
any Guarantor hereunder, or there shall arise or be granted any such pari passu
or senior Superpriority Claim; or
(f) the Bankruptcy Court shall enter an order or orders granting
relief from the automatic stay applicable under Section 362 of the Bankruptcy
Code to the holder or holders of any security interest to permit foreclosure (or
the granting of a deed in lieu of foreclosure or the like) on any assets (other
than assets of, or capital stock of, a High Leverage Guarantor if all loans and
advances made to such High Leverage Guarantor by the Borrower or any Low
Leverage Guarantor have been repaid in full) of the Borrower or any of the
Guarantors that have a value in excess of $500,000 in the aggregate; or
(g) a Change of Control shall occur; or
(h) default shall be made by the Borrower or any Guarantor in the
due observance or performance of any term or condition contained in any Order
applicable to it;
(i) any provision of any Loan Document shall for any reason cease
to be valid and binding or the Borrower or any of the Guarantors, or the
Borrower or any of the Guarantors shall so assert in any pleading filed in any
court; or
(j) an order of the Bankruptcy Court shall be entered reversing,
amending, supplementing, staying for a period in excess of 10 days, vacating or
otherwise modifying either of the Orders or terminating the use of cash
collateral by the Borrower or the Guarantors pursuant to the Orders; or
60
(k) any unsatisfied judgment or order as to a post-petition
liability or debt for the payment of money in excess of $500,000 (to the extent
not paid or covered by a reputable insurance company which has not disputed
liability in writing) shall be rendered against the Borrower or any of the
Guarantors and the enforcement thereof shall not have been stayed; or
(l) any non-monetary judgment or order with respect to a
post-petition event shall be rendered against the Borrower or any of the
Guarantors which does or would reasonably be expected to (i) cause a material
adverse change in the financial condition, business, prospects, operations or
assets of the Borrower and the Guarantors taken as a whole on a consolidated
basis, (ii) have a material adverse effect on the ability of the Borrower or any
of the Guarantors to perform their respective obligations under any Loan
Document, or (iii) have a material adverse effect on the rights and remedies of
the Agent or any DIP Lender under any Loan Document, and there shall be any
period of 30 consecutive days during which a stay of enforcement of such
judgment or order, by reason of a pending appeal or otherwise, shall not be in
effect; or
(m) except as permitted by the Orders, the Borrower or the
Guarantors shall make any Pre-Petition Payment other than Pre-Petition Payments
authorized by the Bankruptcy Court (i) in "first day orders" approved by the
Agent (including to pay pre-petition trust fund taxes) or (ii) to pay lease
payments reflected in the Budget in respect of Capital Leases constituting
Pre-Petition Indebtedness; or
(n) any Termination Event described in clauses (iii) or (iv) of
the definition of such term shall have occurred and shall continue unremedied
for more than 10 days and the sum (determined as of the date of occurrence of
such Termination Event) of the Insufficiency of the Plan in respect of which
such Termination Event shall have occurred and be continuing and the
Insufficiency of any and all other Plans with respect to which such a
Termination Event (described in such clauses (iii) or (iv)) shall have occurred
and then exist is equal to or greater than $100,000; or
(o) (i) the Borrower or any ERISA Affiliate thereof shall have
been notified by the sponsor of a Multiemployer Plan that it has incurred
Withdrawal Liability to such Multiemployer Plan, (ii) the Borrower or such ERISA
Affiliate does not have reasonable grounds to contest such Withdrawal Liability
and is not in fact contesting such Withdrawal Liability in a timely and
appropriate manner and (iii) the amount of such Withdrawal Liability specified
in such notice, when aggregated with all other amounts required to be paid to
Multiemployer Plans by the Borrower or such ERISA Affiliate in connection with
Withdrawal Liabilities (determined as of the date of such notification), exceeds
$50,000 allocable to post-petition obligations or requires payments exceeding
$100,000 per annum in excess of the annual payments made with respect to such
Multiemployer Plans by the Borrower or such ERISA Affiliate for the plan year
immediately preceding the plan year in which such notification is received; or
61
(p) the Borrower or any ERISA Affiliate thereof shall have been
notified by the sponsor of a Multiemployer Plan that such Multiemployer Plan is
in reorganization or is being terminated, within the meaning of Title IV of
ERISA, if as a result of such reorganization or termination the aggregate annual
contributions of the Borrower and its ERISA Affiliates to all Multiemployer
Plans that are then in reorganization or being terminated have been or will be
increased over the amounts contributed to such Multiemployer Plans for the plan
years that include the date hereof by an amount exceeding $100,000; or
(q) the Borrower or any ERISA Affiliate shall have committed a
failure described in Section 302(f)(1) of ERISA (other than the failure to make
any contribution accrued and unpaid as of the Petition Date) and the amount
determined under Section 302(f)(3) of ERISA is equal to or greater than
$100,000; or
(r) it shall be determined (whether by the Bankruptcy Court or by
any other judicial or administrative forum) that the Borrower or any Guarantor
is liable for the payment of claims arising out of any failure to comply (or to
have complied) with applicable environmental laws or regulations the payment of
which will have a material adverse effect on the financial condition, business,
properties, operations or assets of the Borrower and the Guarantors, taken as a
whole, and the enforcement thereof shall not have been stayed;
then, and in every such event and at any time thereafter during the continuance
of such event, and without further order of or application to the Bankruptcy
Court, the Agent may, and at the request of the Required DIP Lenders shall take
one or more of the following actions, at the same or different times (provided,
that with respect to clause (iv) below and the enforcement of Liens or other
remedies with respect to the Collateral referred to in clause (v) below, the
Agent shall provide the Borrower and its counsel (with a copy to counsel for any
Official Creditors' Committee in the Cases, to counsel for the Pre-Petition
Agent and to the United States Trustee for the Southern District of New York)
with five (5) Business Days' written notice prior to taking the action
contemplated thereby, and provided, further, that upon receipt of notice
referred to in the immediately preceding clause with respect to the accounts
referred to in clause (iv) below, the Borrower may continue to make ordinary
course disbursements from such accounts (other than the Letter of Credit
Account) but may not withdraw or disburse any other amounts from such accounts):
(i) terminate forthwith the Total Commitment; (ii) declare the Loans then
outstanding to be forthwith due and payable, whereupon the principal of the
Loans together with accrued interest thereon and any unpaid accrued Fees and all
other liabilities of the Borrower accrued hereunder and under any other Loan
Document, shall become forthwith due and payable, without presentment, demand,
protest or any other notice of any kind, all of which are hereby expressly
waived by the Borrower and the Guarantors, anything contained herein or in any
other Loan Document to the contrary
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notwithstanding; (iii) require the Borrower and the Guarantors upon demand to
forthwith deposit in the Letter of Credit Account cash in an amount that,
together with any amounts then held in the Letter of Credit Account, is equal to
the sum of 105% of the then outstanding Letters of Credit (and to the extent the
Borrower and the Guarantors shall fail to furnish such funds as demanded by the
Agent, the Agent shall be authorized to debit the accounts of the Borrower and
the Guarantors maintained with the Agent in such amount five (5) Business Days
after the giving of the notice referred to above); (iv) set-off amounts in the
Letter of Credit Account or any other accounts maintained with the Agent and
apply such amounts to the obligations of the Borrower and the Guarantors
hereunder and in the other Loan Documents; and (v) exercise any and all remedies
under the Loan Documents and under applicable law available to the Agent and the
DIP Lenders.
ARTICLE 8
THE AGENT
SECTION 8.01. Administration by Agent. The general administration of
the Loan Documents shall be performed by the Agent. Each DIP Lender hereby
irrevocably authorizes the Agent, at its discretion, to take or refrain from
taking such actions as agent on its behalf and to exercise or refrain from
exercising such powers under the Loan Documents as are delegated by the terms
hereof or thereof, as appropriate, together with all powers reasonably
incidental thereto (including the release of Collateral in connection with any
transaction that is expressly permitted by the Loan Documents). The Agent shall
have no duties or responsibilities except as set forth in this Agreement and the
remaining Loan Documents.
SECTION 8.02. Advances and Payments.
(a) On the date of each Loan, the Agent shall be authorized (but
not obligated) to advance, for the account of each of the DIP Lenders, the
amount of the Loan to be made by it in accordance with its Commitment hereunder.
Should the Agent do so, each of the DIP Lenders agrees forthwith to reimburse
the Agent in immediately available funds for the amount so advanced on its
behalf by the Agent, together with interest at the Federal Funds Effective Rate
if not so reimbursed on the date due from and including such date but not
including the date of reimbursement.
(b) Any amounts received by the Agent in connection with this
Agreement (other than amounts to which the Agent is entitled pursuant to
Sections 2.19, 8.06, 10.05 and 10.06), the application of which is not otherwise
provided for in this Agreement shall be applied, first, in accordance with each
DIP Lender's Commitment Percentage to pay accrued but unpaid Commitment Fees or
Letter of Credit Fees, and second, in accordance
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with each DIP Lender's Commitment Percentage to pay accrued but unpaid interest
and the principal balance outstanding and all reimbursed Letter of Credit
drawings. All amounts to be paid to a DIP Lender by the Agent shall be credited
to that DIP Lender, after collection by the Agent, in immediately available
funds either by wire transfer or deposit in that DIP Lender's correspondent
account with the Agent, as such DIP Lender and the Agent shall from time to time
agree.
SECTION 8.03. Sharing of Setoffs. Each DIP Lender agrees that if it
shall, through the exercise of a right of banker's lien, setoff or counterclaim
against the Borrower, including, but not limited to, a secured claim under
Section 506 of the Bankruptcy Code or other security interest arising from, or
in lieu of, such secured claim and received by such DIP Lender under any
applicable bankruptcy, insolvency or other similar law, or otherwise, obtain
payment in respect of its Loans as a result of which the unpaid portion of its
Loans is proportionately less than the unpaid portion of the Loans of any other
DIP Lender (a) it shall promptly purchase at par (and shall be deemed to have
thereupon purchased) from such other DIP Lender a participation in the Loans of
such other DIP Lender, so that the aggregate unpaid principal amount of each DIP
Lender's Loans and its participation in Loans of the other DIP Lenders shall be
in the same proportion to the aggregate unpaid principal amount of all Loans
then outstanding as the principal amount of its Loans prior to the obtaining of
such payment was to the principal amount of all Loans outstanding prior to the
obtaining of such payment and (b) such other adjustments shall be made from time
to time as shall be equitable to ensure that the DIP Lenders share such payment
pro-rata, provided that if any such non-pro-rata payment is thereafter recovered
or otherwise set aside, such purchase of participation shall be rescinded
(without interest). The Borrower expressly consents to the foregoing
arrangements and agrees that any DIP Lender holding (or deemed to be holding) a
participation in a Loan may exercise any and all rights of banker's lien, setoff
(in each case, subject to the same notice requirements as pertain to clause (iv)
of the remedial provisions of Section 7.01) or counterclaim with respect to any
and all moneys owing by the Borrower to such DIP Lender as fully as if such DIP
Lender held a Note and was the original obligee thereon, in the amount of such
participation.
SECTION 8.04. Agreement of Required DIP Lenders. Upon any occasion
requiring or permitting an approval, consent, waiver, election or other action
on the part of the Required DIP Lenders, action shall be taken by the Agent for
and on behalf or of the benefit of all DIP Lenders upon the direction of the
Required DIP Lenders, and any such action shall be binding on all DIP Lenders.
No amendment, modification, consent, or waiver shall be effective except in
accordance with the provisions of Section 10.10.
SECTION 8.05. Liability of Agent.
(a) The Agent when acting on behalf of the DIP Lenders, may
execute any of its respective duties under this Agreement by or through any of
its respective officers,
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agents, and employees, and neither the Agent, either Co-Arranger nor their
respective directors, officers, agents, employees or Affiliates shall be liable
to the DIP Lenders or any of them for any action taken or omitted to be taken in
good faith, or be responsible to the DIP Lenders or to any of them for the
consequences of any oversight or error of judgment, or for any loss, unless the
same shall happen through its gross negligence or willful misconduct. The Agent,
each Co-Arranger and their respective directors, officers, agents, employees and
Affiliates shall in no event be liable to the DIP Lenders or to any of them for
any action taken or omitted to be taken by them pursuant to instructions
received by them from the Required DIP Lenders or in reliance upon the advice of
counsel selected by it. Without limiting the foregoing, neither the Agent, the
Co-Arrangers nor any of their respective directors, officers, employees, agents
or Affiliates shall be responsible to any DIP Lender for the due execution,
validity, genuineness, effectiveness, sufficiency, or enforceability of, or for
any statement, warranty or representation in, this Agreement, any Loan Document
or any related agreement, document or order, or shall be required to ascertain
or to make any inquiry concerning the performance or observance by the Borrower
of any of the terms, conditions, covenants, or agreements of this Agreement or
any of the Loan Documents.
(b) Neither the Agent, the Co-Arrangers nor any of their
respective directors, officers, employees, agents or affiliates shall have any
responsibility to the Borrower or the Guarantors on account of the failure or
delay in performance or breach by any DIP Lender or by the Borrower or the
Guarantors of any of their respective obligations under this Agreement or any of
the Loan Documents or in connection herewith or therewith.
(c) The Agent, in its capacity as Agent hereunder, shall be
entitled to rely on any communication, instrument, or document reasonably
believed by such person to be genuine or correct and to have been signed or sent
by a person or persons believed by such person to be the proper person or
persons, and such person shall be entitled to rely on advice of legal counsel,
independent public accountants, and other professional advisers and experts
selected by such person.
SECTION 8.06. Reimbursement and Indemnification. Each DIP Lender agrees
(i) to reimburse (x) the Agent for such DIP Lender's Commitment Percentage of
any expenses and fees incurred for the benefit of the DIP Lenders under this
Agreement and any of the Loan Documents, including, without limitation, counsel
fees and compensation of agents and employees paid for services rendered on
behalf of the DIP Lenders, and any other expense incurred in connection with the
operations or enforcement thereof not reimbursed by the Borrower or the
Guarantors and (y) the Agent for such DIP Lender's Commitment Percentage of any
expenses of the Agent incurred for the benefit of the DIP Lenders that the
Borrower has agreed to reimburse pursuant to Section 10.05 and has failed to so
reimburse and (ii) to indemnify and hold harmless the Agent and any of its
directors, officers, employees, agents or Affiliates, on demand, in the amount
of its proportionate share, from and against any and all liabilities,
obligations, losses, damages,
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penalties, actions, judgments, suits, costs, expenses, or disbursements of any
kind or nature whatsoever which may be imposed on, incurred by, or asserted
against it or any of them in any way relating to or arising out of this
Agreement or any of the Loan Documents or any action taken or omitted by it or
any of them under this Agreement or any of the Loan Documents to the extent not
reimbursed by the Borrower or the Guarantors (except such as shall result from
their respective gross negligence or willful misconduct).
SECTION 8.07. Rights of Agent. It is understood and agreed that MSSF
and Lehman (and their respective affiliates) shall have the same rights and
powers hereunder (including the right to give such instructions) as the other
DIP Lenders and may exercise such rights and powers, as well as its rights and
powers under other agreements and instruments to which it is or may be party,
and engage in other transactions with the Borrower or any Guarantor, as though
they were not the Agent of the DIP Lenders and/or Co-Arranger under this
Agreement.
SECTION 8.08. Independent DIP Lenders. Each DIP Lender acknowledges
that it has decided to enter into this Agreement and to make the Loans hereunder
based on its own analysis of the transactions contemplated hereby and of the
creditworthiness of the Borrower and the Guarantors and agrees that the Agent
shall bear no responsibility therefor.
SECTION 8.09. Notice of Transfer. The Agent may deem and treat a DIP
Lender party to this Agreement as the owner of such DIP Lender's portion of the
Loans for all purposes, unless and until a written notice of the assignment or
transfer thereof executed by such DIP Lender shall have been received by the
Agent.
SECTION 8.10. Successor Agent. The Agent may resign at any time by
giving written notice thereof to the DIP Lenders and the Borrower. Upon any such
resignation, the Required DIP Lenders shall have the right to appoint a
successor Agent, which shall be reasonably satisfactory to the Borrower. If no
successor Agent shall have been so appointed by the Required DIP Lenders and
shall have accepted such appointment, within 30 days after the retiring Agent's
giving of notice of resignation, the retiring Agent may, on behalf of the DIP
Lenders, appoint a successor Agent, which shall be a commercial bank organized
under the laws of the United States of America or of any State thereof and
having a combined capital and surplus of at least $100,000,000, which shall be
reasonably satisfactory to the Borrower. Upon the acceptance of any appointment
as Agent hereunder by a successor Agent, such successor Agent shall thereupon
succeed to and become vested with all the rights, powers, privileges and duties
of the retiring Agent, and the retiring Agent shall be discharged from its
duties and obligations under this Agreement. After any retiring Agent's
resignation hereunder as Agent, the provisions of this Section 8 shall inure to
its benefit as to any actions taken or omitted to be taken by it while it was
Agent under this Agreement.
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ARTICLE 9
GUARANTY
SECTION 9.01. Guaranty.
(a) Each of the Guarantors unconditionally and irrevocably
guarantees the due and punctual payment and performance by the Borrower of the
Obligations. Each of the Guarantors further agrees that the Obligations may be
extended or renewed, in whole or in part, without notice to or further assent
from it, and it will remain bound upon this guaranty notwithstanding any
extension or renewal of any of the Obligations. The Obligations of the
Guarantors shall be joint and several.
(b) Each of the Guarantors waives presentation to, demand for
payment from and protest to the Borrower or any other Guarantor, and also waives
notice of protest for nonpayment. The Obligations of the Guarantors hereunder
shall not be affected by (i) the failure of the Agent or a DIP Lender to assert
any claim or demand or to enforce any right or remedy against the borrower or
any other Guarantor under the provisions of this Agreement or any other Loan
Document or otherwise; (ii) any extension or renewal of any provision hereof or
thereof; (iii) any rescission, waiver, compromise, acceleration, amendment or
modification of any of the terms or provisions of any of the Loan Documents;
(iv) the release, exchange, waiver or foreclosure of any security held by the
Agent for the Obligations or any of them; (v) the failure of the Agent or a DIP
Lender to exercise any right or remedy against any other Guarantor; or (vi) the
release or substitution of the Borrower or any other Guarantor.
(c) Each of the Guarantors further agrees that this guaranty
constitutes a guaranty of performance and of payment when due and not just of
collection, and waives any right to require that any resort be had by the Agent
or a DIP Lender to any security held for payment of the Obligations or to any
balance of any deposit, account or credit on the books of the Agent or a DIP
Lender in favor of the Borrower or any other Guarantor, or to any other Person.
(d) Each of the Guarantors hereby waives any defense that it might
have based on a failure to remain informed of the financial condition of the
Borrower and of any other Guarantor and any circumstances affecting the ability
of the Borrower to perform under this Agreement.
(e) Each Guarantor's guaranty shall not be affected by the
genuineness, validity, regularity or enforceability of the Obligations or any
other instrument evidencing any Obligations, or by the existence, validity,
enforceability, perfection, or extent of any collateral therefor or by any other
circumstance relating to the Obligations that might otherwise constitute a
defense to this Guaranty.
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(f) Subject to the provisions of Section 7.01, upon the
Obligations becoming due and payable (by acceleration or otherwise), the DIP
Lenders shall be entitled to immediate payment of such Obligations by the
Guarantors upon written demand by the Agent, without further application to or
order of the Bankruptcy Court.
SECTION 9.02. No Impairment of Guaranty. The obligations of the
Guarantors hereunder shall not be subject to any reduction, limitation,
impairment or termination for any reason, including, without limitation, any
claim of waiver, release, surrender, alteration or compromise, and shall not be
subject to any defense or set-off, counterclaim, recoupment or termination
whatsoever by reason of the invalidity, illegality or unenforceability of the
Obligations. Without limiting the generality of the foregoing, the obligations
of the Guarantors hereunder shall not be discharged or impaired or otherwise
affected by the failure of the Agent or a DIP Lender to assert any claim or
demand or to enforce any remedy under this Agreement or any other agreement, by
any waiver or modification of any provision thereof, by any default, failure or
delay, willful or otherwise, in the performance of the Obligations, or by any
other act or thing or omission or delay to do any other act or thing that may or
might in any manner or to any extent vary the risk of the Guarantors or would
otherwise operate as a discharge of the Guarantors as a matter of law, unless
and until the Obligations are paid in full.
SECTION 9.03. Subrogation. Upon payment by any Guarantor of any sums to
the Agent or a DIP Lender hereunder, all rights of such Guarantor against the
Borrower arising as a result thereof by way of right of subrogation or
otherwise, shall in all respects be subordinate and junior in right of payment
to the prior final payment in full of all the Obligations. If any amount shall
be paid to such Guarantor for the account of the Borrower, such amount shall be
held in trust for the benefit of the Agent and the DIP Lenders and shall
forthwith be paid to the Agent and the DIP Lenders to be credited and applied to
the Obligations, whether matured or unmatured.
SECTION 9.04. Release of Guaranty. The obligations of a Guarantor under
this Article 9 will terminate upon a sale or other disposition of such Guarantor
or the sale or disposition of all or substantially all the assets of such
Guarantor (in each case other than to the Borrower or a Subsidiary of the
Borrower) that is permitted by Section 6.11 of this Agreement so long as the Net
Cash Proceeds of such sale or disposition are applied as required by Section
2.13 of this Agreement.
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ARTICLE 10
MISCELLANEOUS
SECTION 10.01. Notices. Notices and other communications provided for
herein shall be in writing (including telegraphic, telex, facsimile or cable
communication) and shall be mailed, telegraphed, telexed, transmitted, cabled or
delivered to the Borrower or any Guarantor at 3445 Peachtree Road, Suite 700,
Atlanta, GA 30326, Attention: Chief Financial Officer, if to a DIP Lender, to it
as set forth on Annex A and if to the Agent, at its address at 1285 Broadway, 10
th Floor, New York, NY 10036, Attention: James Morgan, with a copy to it at 1221
Avenue of the Americas, 35 th Floor, New York, NY 10020, Attention: Morgan
Edwards, or such other address as such party may from time to time designate by
giving written notice to the other parties hereunder. All notices and other
communications given to any party hereto in accordance with the provisions of
this Agreement shall be deemed to have been given on the fifth Business Day
after the date when sent by registered or certified mail, postage prepaid,
return receipt requested, if by mail; or when delivered to the telegraph
company, charges prepaid, if by telegram; or when receipt is acknowledged, if by
any telegraphic communications or facsimile equipment of the sender, in each
case addressed to such party as provided in this Section 10.01 or in accordance
with the latest unrevoked written direction from such party; provided, however,
that in the case of notices to the Agent notices pursuant to the preceding
sentence with respect to change of address and pursuant to Section 2 shall be
effective only when received by the Agent.
SECTION 10.02. Survival of Agreement, Representations and Warranties,
etc. All warranties, representations and covenants made by the Borrower or any
Guarantor herein or in any certificate or other instrument delivered by it or on
its behalf in connection with this Agreement shall be considered to have been
relied upon by the DIP Lenders and shall survive the making of the Loans herein
contemplated regardless of any investigation made by any DIP Lender or on its
behalf and shall continue in full force and effect so long as any amount due or
to become due hereunder is outstanding and unpaid and so long as the Commitments
have not been terminated. All statements in any such certificate or other
instrument shall constitute representations and warranties by the Borrower and
the Guarantors hereunder with respect to the Borrower and the Guarantors.
SECTION 10.03. Successors and Assigns.
(a) This Agreement shall be binding upon and inure to the benefit
of the Borrower, the Agent and the DIP Lenders and their respective successors
and assigns. Neither the Borrower nor any of the Guarantors may assign or
transfer any of their rights or obligations hereunder without the prior written
consent of all of the DIP Lenders. Each DIP Lender may sell participations to
any Person in all or part of any Loan, or all or part of its Commitment, in
which event, without limiting the foregoing, the provisions of Section 2.15
shall inure to the benefit of each purchaser of a participation (provided that
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such participant shall look solely to the seller of such participation for such
benefits and the Borrower's and the Guarantors' liability, if any, under
Sections 2.15 and 2.18 shall not be increased as a result of the sale of any
such participation) and the pro rata treatment of payments, as described in
Section 2.17, shall be determined as if such DIP Lender had not sold such
participation. In the event any DIP Lender shall sell any participation, such
DIP Lender shall retain the sole right and responsibility to enforce the
obligations of the Borrower and each of the Guarantors relating to the Loans,
including, without limitation, the right to approve any amendment, modification
or waiver of any provision of this Agreement (provided that such DIP Lender may
grant its participant the right to consent to such DIP Lender's execution of
amendments, modifications or waivers that (i) reduce any Fees payable hereunder
to the DIP Lenders, (ii) reduce the amount of any scheduled principal payment on
any Loan or reduce the principal amount of any Loan or the stated rate of
interest payable hereunder or (iii) extend the maturity of the Borrower's
obligations hereunder). The sale of any such participation shall not alter the
rights and obligations of the DIP Lender selling such participation hereunder
with respect to the Borrower or the Guarantors.
(b) Each DIP Lender may assign to one or more DIP Lenders or
Eligible Assignees all or a portion of its interests, rights and obligations
under this Agreement (including, without limitation, all or a portion of its
Commitment and the same portion of the related Loans at the time owing to it),
provided, however, that (i) other than in the case of an assignment to a DIP
Lender Affiliate of the assignor DIP Lender or to another DIP Lender, the Agent
and the Fronting Bank must give their respective prior written consent to such
assignment, which consent will not be unreasonably withheld, (ii) the aggregate
amount of the Commitment and/or Loans of the assigning DIP Lender subject to
each such assignment (determined as of the date the Assignment and Acceptance
with respect to such assignment is delivered to the Agent) shall, unless
otherwise agreed to in writing by the Borrower and the Agent, in no event be
less than $1,000,000 or the remaining portion of such DIP Lender's Commitments,
if less and (iii) the parties to each such assignment shall execute and deliver
to the Agent, for its acceptance and recording in the Register (as defined
below), an Assignment and Acceptance with blanks appropriately completed,
together with a processing and recordation fee of $3,500 (for which the Borrower
shall have no liability). Upon such execution, delivery, acceptance and
recording, from and after the effective date specified in each Assignment and
Acceptance, which effective date shall be within ten Business Days after the
execution thereof (unless otherwise agreed to in writing by the Agent), (A) the
assignee thereunder shall be a party hereto and, to the extent provided in such
Assignment and Acceptance, have the rights and obligations of a DIP Lender
hereunder and (B) the DIP Lender thereunder shall, to the extent provided in
such Assignment and Acceptance, be released from its obligations under this
Agreement (and, in the case of an Assignment and Acceptance covering all or the
remaining portion of an assigning DIP Lender's rights and obligations under this
Agreement, such DIP Lender shall cease to be a party hereto).
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(c) By executing and delivering an Assignment and Acceptance, the
DIP Lender assignor thereunder and the assignee thereunder confirm to and agree
with each other and the other parties hereto as follows: (i) other than the
representation and warranty that it is the legal and beneficial owner of the
interest being assigned thereby free and clear of any adverse claim, such DIP
Lender assignor makes no representation or warranty and assumes no
responsibility with respect to any statements, warranties or representations
made in or in connection with this Agreement or any of the other Loan Documents
or the execution, legality, validity, enforceability, genuineness, sufficiency
or value of this Agreement or any of the other Loan Documents; (ii) such DIP
Lender assignor makes no representation or warranty and assumes no
responsibility with respect to the financial condition of the Borrower or any
Guarantor or the performance or observance by the Borrower or any Guarantor of
any of its obligations under this Agreement or any of the other Loan Documents
or any other instrument or document furnished pursuant hereto, (iii) such
assignee confirms that it has received a copy of this Agreement and the other
Loan Documents, together with copies of the financial statements referred to in
Section 3.04 and such other documents and information as it has deemed
appropriate to make its own credit analysis and decision to enter into such
Assignment and Acceptance; (iv) such assignee will, independently and without
reliance upon the Agent, such DIP Lender assignor or any other DIP Lender and
based on such documents and information as it shall deem appropriate at the
time, continue to make its own credit decisions in taking or not taking action
under this Agreement; (v) such assignee appoints and authorizes the Agent to
take such action as agent on its behalf and to exercise such powers under this
Agreement as are delegated to the Agent by the terms thereto, together with such
powers as are reasonably incidental hereof; and (vi) such assignee agrees that
it will perform in accordance with their terms all obligations that by the terms
of this Agreement are required to be performed by it as a DIP Lender.
(d) The Agent shall maintain at its office a copy of each
Assignment and Acceptance delivered to it and a register for the recordation of
the names and addresses of the DIP Lenders and the Commitments of, and principal
amount of the Loans owing to, each DIP Lender from time to time (the
"REGISTER"). The entries in the Register shall be conclusive, in the absence of
manifest error, and the Borrower, the Guarantors, the Agent and the DIP Lenders
shall treat each Person the name of which is recorded in the Register as a DIP
Lender hereunder for all purposes of this Agreement. The Register shall be
available for inspection by the Borrower or any DIP Lender at any reasonable
time and from time to time upon reasonable prior notice.
(e) Upon its receipt of an Assignment and Acceptance executed by
an assigning DIP Lender and the assignee thereunder together with the fee
payable in respect thereto, the Agent shall, if such Assignment and Acceptance
has been completed with blanks appropriately filled and consented to by the
Agent and the Fronting Bank (to the extent such consent is required hereunder),
(i) accept such Assignment and Acceptance, (ii) record the information contained
therein in the Register and (iii) give prompt written
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notice thereof to the Borrower (together with a copy thereof). No assignment
shall be effective for purposes of this Agreement unless it has been recorded in
the Register as provided in this paragraph.
(f) Any DIP Lender may, in connection with any assignment or
participation or proposed assignment or participation pursuant to this Section
10.03, disclose to the assignee or participant or proposed assignee or
participant, any information relating to the Borrower or any of the Guarantors
furnished to such DIP Lender by or on behalf of the Borrower or any of the
Guarantors; provided that prior to any such disclosure, each such assignee or
participant or proposed assignee or participant shall agree in writing to be
bound by the provisions of Section 10.04.
(g) The Borrower hereby agrees to actively assist and cooperate
with the Agent in the Agent's efforts to sell participations herein (as
described in Section 10.03(a)) and assign to one or more DIP Lenders or Eligible
Assignees a portion of its interests, rights and obligations under this
Agreement (as set forth in Section 10.03(b)).
(h) Each DIP Lender agrees that if any Primed Lender that is an
Eligible Assignee wishes to become a DIP Lender then, such Primed Lender shall
be entitled to assume a portion (determined as set forth below) of such DIP
Lender's Commitment hereunder and acquire a corresponding portion of its
outstanding Loans and Letter of Credit Outstandings for a purchase price equal
to 100% of such outstanding Loans plus unreimbursed Letter of Credit
Outstandings plus accrued and unpaid interest and fees payable in respect
thereof. Each such assumption and assignment shall be effected in accordance
with this Section 10.03. The portion of each DIP Lender's Commitment subject to
assumption by such Primed Lender shall be determined as follows. The Primed
Lender shall be entitled to a Commitment Percentage equal to its Scheduled
Percentage. Therefore, the Commitment Percentage of each DIP Lender shall be
reduced to the extent it exceeds its Scheduled Percentage (with the greatest
excess being reduced first and DIP Lenders with the same excess being reduced
ratably) until the aggregate amount of such reductions constitute a Commitment
Percentage equal to the Primed Lender's Scheduled Percentage. The Primed Lender
that wishes to become a DIP Lender shall then assume from each DIP Lender the
portion of its Commitment corresponding to the reduction (if any) applicable to
such DIP Lender.
SECTION 10.04. Confidentiality. Each DIP Lender agrees to keep any
information delivered or made available by the Borrower or any of its
Subsidiaries to it confidential from anyone other than persons employed or
retained by such DIP Lender who are or are expected to become engaged in
evaluating, approving, structuring or administering the Loan and then only on a
confidential basis; provided that nothing herein shall prevent any DIP Lender
from disclosing such information (i) to any of its Affiliates or to any other
DIP Lender, provided such Affiliate agrees to keep such information confidential
to the same extent required by the DIP Lenders hereunder, (ii) upon the order
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of any court or administrative agency, (ii) upon the request or demand of any
regulatory agency or authority, (iii) that has been publicly disclosed other
than as a result of a disclosure by the Agent or any DIP Lender that is not
permitted by this Agreement, (iv) in connection with any litigation to which the
Agent, any DIP Lender, or their respective Affiliates may be a party to the
extent reasonably required, (v) to the extent reasonably required in connection
with the exercise of any remedy hereunder, (vi) to such DIP Lender's legal
counsel and independent auditors and then only on a confidential basis and (vii)
to any actual or proposed participant or assignee of all or part of its rights
hereunder subject to the proviso in Section 10.03(f). Each DIP Lender shall use
reasonable efforts to notify the Borrower of any required disclosure under
clause (ii) of this Section prior to making such disclosure.
SECTION 10.05. Expenses. Whether or not the transactions hereby
contemplated shall be consummated, the Borrower and the Guarantors agree to pay
all reasonable expenses incurred by the Agent (including but not limited to the
reasonable fees and disbursements of Davis Polk & Wardwell, special counsel for
the Agent, any other counsel that the Agent shall retain and any internal or
third-party appraisers, consultants and auditors advising the Agent and their
counsel) in connection with the preparation, execution, delivery and
administration of this Agreement and the other Loan Documents, the making of the
Loans and the issuance of the Letters of Credit, the perfection of the Liens
contemplated hereby, the syndication of the transactions contemplated hereby,
the costs, fees and expenses of the Agent in connection with its monthly and
other periodic field audits, monitoring of assets (including reasonable and
customary internal collateral monitoring fees) and publicity expenses, and,
following the occurrence of an Event of Default, all expenses incurred by the
DIP Lenders and the Agent in the enforcement or protection of the rights of any
one or more of the DIP Lenders or the Agent in connection with this Agreement or
the other Loan Documents, including but not limited to the reasonable fees and
disbursements of any counsel for the DIP Lenders or the Agent. Such payments
shall be made on the date of the Interim Order and thereafter within five days
of demand upon delivery of a statement setting forth such costs and expenses.
The obligations of the Borrower and the Guarantors under this Section shall
survive the termination of this Agreement and/or the payment of the Loans.
SECTION 10.06. Indemnity. The Borrower and each of the Guarantors agree
to indemnify and hold harmless the Agent, and the DIP Lenders and their
directors, officers, employees, agents and Affiliates (each an "INDEMNIFIED
PARTY") from and against any and all expenses, losses, claims, damages and
liabilities incurred by such Indemnified Party arising out of claims made by any
Person in any way relating to the transactions contemplated hereby, but
excluding therefrom all expenses, losses, claims, damages, and liabilities to
the extent that they are determined by the final judgment of a court of
competent jurisdiction to have resulted from the gross negligence or willful
misconduct of such Indemnified Party. The obligations of the Borrower and the
Guarantors under
73
this Section shall survive the termination of this Agreement and/or the payment
of the Loans.
SECTION 10.07. CHOICE OF LAW. THIS AGREEMENT AND THE OTHER LOAN
DOCUMENTS SHALL IN ALL RESPECTS BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY
THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS MADE AND TO BE
PERFORMED WHOLLY WITHIN SUCH STATE AND THE BANKRUPTCY CODE.
SECTION 10.08. No Waiver. No failure on the part of the Agent or any of
the DIP Lenders to exercise, and no delay in exercising, any right, power or
remedy hereunder or any of the other Loan Documents shall operate as a waiver
thereof, nor shall any single or partial exercise of any such right, power or
remedy preclude any other or further exercise thereof or the exercise of any
other right, power or remedy. All remedies hereunder are cumulative and are not
exclusive of any other remedies provided by law.
SECTION 10.09. Extension of Maturity. Should any payment of principal
of or interest or any other amount due hereunder become due and payable on a day
other than a Business Day, the maturity thereof shall be extended to the next
succeeding Business Day and, in the case of principal, interest shall be payable
thereon at the rate herein specified during such extension.
SECTION 10.10. Amendments, etc.
(a) No modification, amendment or waiver of any provision of this
Agreement or the Security and Pledge Agreement and no consent to any departure
by the Borrower or any Guarantor therefrom, shall in any event be effective
unless the same shall be in writing and signed by the Required DIP Lenders, and
then such waiver or consent shall be effective only in the specific instance and
for the purpose for which given; provided, however, that no such modification or
amendment shall, without the written consent of the DIP Lender affected thereby
(x) increase the Commitment of a DIP Lender (it being understood that a waiver
of an Event of Default shall not constitute an increase in the Commitment of a
DIP Lender), or (y) reduce the principal amount of any Loan or the stated rate
of interest payable thereon, or extend any date for the payment of interest
hereunder or reduce any Fees payable hereunder or extend the final maturity of
the Borrower's obligations hereunder; and, provided, further, that no such
modification or amendment shall, without the written consent of (A) all of the
DIP Lenders (i) amend or modify any provision of this Agreement that provides
for the unanimous consent or approval of the DIP Lenders, (ii) amend this
Section 10.10 or the definition of Required DIP Lenders or (iii) amend or modify
the Superpriority Claim status of the DIP Lenders contemplated by Section 2.23
or (B) the Super-Majority DIP Lenders (as hereinafter defined), (i) release all
or any substantial portion of the Collateral from the Liens granted
74
to the Agent hereunder, under the Orders or under any other Loan Document, (ii)
release any Guarantor or (iii) change Schedule 3.15 or any defined term in a
manner which would increase the amount of the Available Commitment. No such
amendment or modification may adversely affect the rights and obligations of the
Agent or any Fronting Bank hereunder or any DIP Lender in the capacity referred
to in Section 6.03(a)(iv) without its prior written consent. No notice to or
demand on the Borrower or any Guarantor shall entitle the Borrower or any
Guarantor to any other or further notice or demand in the same, similar or other
circumstances. Each assignee under Section 10.03(b) shall be bound by any
amendment, modification, waiver, or consent authorized as provided herein, and
any consent by a DIP Lender shall bind any Person subsequently acquiring an
interest on the Loans held by such DIP Lender. No amendment to this Agreement
shall be effective against the Borrower or any Guarantor unless signed by the
Borrower or such Guarantor, as the case may be.
(b) Notwithstanding anything to the contrary contained in Section
10.10(a), in the event that the Borrower requests that this Agreement be
modified or amended in a manner that would require the unanimous consent of all
of the DIP Lenders (or the consent described in clause (B) of the first sentence
of Section 10.10(a)) and such modification or amendment is agreed to by the
Super-Majority DIP Lenders (as hereinafter defined), then with the consent of
the Borrower and the Super-Majority DIP Lenders, the Borrower and the
Super-Majority DIP Lenders shall be permitted to amend the Agreement without the
consent of the DIP Lender or DIP Lenders that did not agree to the modification
or amendment requested by the Borrower (such DIP Lender or DIP Lenders,
collectively the "MINORITY DIP LENDERS") to provide for (w) the termination of
the Commitment of each of the Minority DIP Lenders, (x) the addition to this
Agreement of one or more other financial institutions (each of which shall be an
Eligible Assignee), or an increase in the Commitment of one or more of the
Super-Majority DIP Lenders, so that the Total Commitment after giving effect to
such amendment shall be in the same amount as the Total Commitment immediately
before giving effect to such amendment, (y) if any Loans are outstanding at the
time of such amendment, the making of such additional Loans by such new
financial institutions or Super-Majority DIP Lender or DIP Lenders, as the case
may be, as may be necessary to repay in full the outstanding Loans of the
Minority DIP Lenders immediately before giving effect to such amendment and (z)
such other modifications to this Agreement as may be appropriate. As used
herein, the term "SUPER-MAJORITY DIP LENDERS" shall mean, at any time, DIP
Lenders holding Loans representing at least 66-2/3% of the aggregate principal
amount of the Loans outstanding, or if no Loans are outstanding, DIP Lenders
having Commitments representing at least 66-2/3% of the Total Commitment.
SECTION 10.11. Severability. Any provision of this Agreement that is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining
75
provisions hereof, and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.
SECTION 10.12. Headings. Section headings used herein are for
convenience only and are not to affect the construction of or be taken into
consideration in interpreting this Agreement.
SECTION 10.13. Execution in Counterparts. This Agreement may be
executed in any number of counterparts, each of which shall constitute an
original, but all of which taken together shall constitute one and the same
instrument.
SECTION 10.14. Prior Agreements. This Agreement and the other Loan
Documents represent the entire agreement of the parties with regard to the
subject matter hereof and the terms of any letters and other documentation
entered into between the Borrower or a Guarantor and any DIP Lender or the Agent
prior to the execution of this Agreement.
SECTION 10.15. Further Assurances. Whenever and so often as reasonably
requested by the Agent, the Borrower and the Guarantors will promptly execute
and deliver or cause to be executed and delivered all such other and further
instruments, documents or assurances, and promptly do or cause to be done all
such other and further things as may be necessary and reasonably required in
order to further and more fully vest in the Agent all rights, interests, powers,
benefits, privileges and advantages conferred or intended to be conferred by
this Agreement and the other Loan Documents.
SECTION 10.16. WAIVER OF JURY TRIAL. EACH OF THE BORROWER, THE
GUARANTORS, THE AGENT AND EACH BANK HEREBY IRREVOCABLY WAIVES ALL RIGHT TO TRIAL
BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR RELATING TO
ANY OF THE LOAN DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED THEREBY.
76
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the day and the year first written above.
BORROWER:
LODGIAN, INC.
By: /s/ Daniel E. Ellis
------------------------------------
Title: Vice President
GUARANTORS:
1075 HOSPITALITY, L.P.
By: Stevens Creek Hospitality, Inc.,
as General Partner
12801 NWF BEVERAGE, INC.
ALBANY HOTEL, INC.
AMI OPERATING PARTNERS, L.P.
By: AMIOP Acquisition Corp.,
as General Partner
AMIOP ACQUISITION CORP.
APICO HILLS, INC.
APICO INNS OF GREEN TREE, INC.
APICO INNS OF PENNSYLVANIA, INC.
APICO INNS OF PITTSBURGH, INC.
APICO MANAGEMENT CORP.
ATLANTA-BOSTON SPE, INC.
ATLANTA-BOSTON HOLDINGS LLC
ATLANTA-BOSTON LODGING LLC
ATLANTA-HILLSBORO LODGING, L.L.C.
BRECKSVILLE HOSPITALITY, INC.
BRECKSVILLE HOSPITALITY, L.P.
By: Brecksville Hospitality, Inc.,
as General Partner
BRUNSWICK MOTEL ENTERPRISES, INC.
COLUMBUS HOSPITALITY ASSOCIATES,
LIMITED PARTNERSHIP
By: Servico Columbus, Inc.,
as General Partner
DEDHAM BEVERAGE MANAGEMENT, INC.
DEDHAM LODGING ASSOCIATES I,
LIMITED PARTNERSHIP
By: Impac SPE #3, Inc.,
as General Partner
DOTHAN HOSPITALITY 3053, INC.
DOTHAN HOSPITALITY 3071, INC.
EAST WASHINGTON HOSPITALITY
LIMITED PARTNERSHIP
By: Servico East Washington, Inc.,
as General Partner
EUROPEAN VENTURES, INC.
FAYETTEVILLE MOTEL ENTERPRISES, INC.
FORT WAYNE HOSPITALITY
ASSOCIATES II, LIMITED PARTNERSHIP
By: Servico Fort Wayne II, Inc.,
as General Partner
FOURTH STREET HOSPITALITY, INC.
GADSDEN HOSPITALITY, INC.
GREAT SOUTHERN MINING CO., INC.
GROUPERS & COMPANY SEAFOOD
RESTAURANT
HARRISBURG MOTEL ENTERPRISES, INC.
HEARTLANDS GARDEN GRILLE, INC
HILTON HEAD MOTEL ENTERPRISES, INC.
IMPAC DEVELOPMENT AND
CONSTRUCTION L.L.C.
IMPAC HOLDINGS III, L.L.C.
IMPAC HOTEL GROUP, L.L.C.
IMPAC HOTEL MANAGEMENT L.L.C.
IMPAC HOTELS I, L.L.C.
IMPAC HOTELS II, L.L.C.
IMPAC HOTELS III, L.L.C.
IMPAC SPE #1, INC.
IMPAC SPE #2, INC.
IMPAC SPE #3, INC.
IMPAC SPE #4, INC.
IMPAC SPE #5, INC.
IMPAC SPE #6, INC.
ISLAND MOTEL ENTERPRISES, INC.
KDS CORPORATION
KINSER MOTEL ENTERPRISES, INC.
LAFAYETTE BEVERAGE
MANAGEMENT, INC
LAWRENCE HOSPITALITY
ASSOCIATES, L.P.
By: Servico Lawrence, Inc.,
as General Partner
LITTLE ROCK LODGING ASSOCIATES,
LIMITED PARTNERSHIP
By: Lodgian Richmond SPE, Inc.,
as General Partner
LODGIAN ACQUISITION, LLC.
LODGIAN AMI, INC.
LODGIAN ANAHEIM, INC.
LODGIAN AUSTIN BEVERAGE CORP.
LODGIAN DALLAS BEVERAGE CORP.
LODGIAN FINANCING CORP.
LODGIAN FLORIDA, INC.
LODGIAN HOTELS, INC.
LODGIAN MANAGEMENT CORP.
LODGIAN MARKET CENTER
BEVERAGE CORP.
LODGIAN MOUNT LAUREL, INC.
LODGIAN ONTARIO, INC.
LODGIAN RICHMOND SPE, INC.
LODGIAN RICHMOND, L.L.C.
LODGIAN YORK MARKET STREET, INC.
MANHATTAN HOSPITALITY
ASSOCIATES, L.P.
By: Servico Manhattan, Inc.,
as General Partner
MCKNIGHT MOTEL, INC.
MELBOURNE HOSPITALITY ASSOCIATES,
LIMITED PARTNERSHIP
By: Servico Melbourne, Inc.
as General Partner
MINNEAPOLIS MOTEL ENTERPRISES, INC.
MOON AIRPORT MOTEL, INC.
MULLIGAN'S, INC.
NEW ORLEANS AIRPORT MOTEL
ENTERPRISES, INC.
NH MOTEL ENTERPRISES, INC.
PALM BEACH MOTEL ENTERPRISES, INC.
PENMOCO, INC.
RALEIGH MOTEL ENTERPRISES, INC.
RALEIGH-DOWNTOWN ENTERPRISES, INC.
ROYCE HOLDING CORP.
ROYCE HOTEL CORPORATION
OF DELAWARE
ROYCE MANAGEMENT CORP.
OF GEORGIA
SAGINAW HOSPITALITY,
LIMITED PARTNERSHIP
By: Servico Saginaw, Inc.,
as General Partner
SECOND FAYETTEVILLE MOTEL
ENTERPRISES, INC.
SECOND PALM BEACH MOTEL
ENTERPRISES, INC.
SERVICO ACQUISITION CORP.
SERVICO AUSTIN, INC.
SERVICO CEDAR RAPIDS, INC.
SERVICO CENTRE ASSOCIATES, LTD.
By: Palm Beach Motel Enterprises, Inc.,
as General Partner
SERVICO COLESVILLE, INC.
SERVICO COLUMBIA II, INC.
SERVICO COLUMBIA, INC.
SERVICO COLUMBUS, INC.
SERVICO CONCORD, INC.
SERVICO COUNCIL BLUFFS, INC.
SERVICO EAST WASHINGTON, INC.
SERVICO FLAGSTAFF, INC.
SERVICO FORT WAYNE II, INC.
SERVICO FORT WAYNE, INC.
SERVICO FRISCO, INC.
SERVICO FT. PIERCE, INC.
SERVICO GRAND ISLAND, INC.
SERVICO HILTON HEAD, INC.
SERVICO HOSPITALITY, INC.
SERVICO HOTELS I, INC.
SERVICO HOTELS II, INC.
SERVICO HOTELS III, INC.
SERVICO HOTELS IV, INC.
SERVICO HOUSTON, INC.
SERVICO INVESTMENT COMPANY
OF DELAWARE, INC.
SERVICO JAMESTOWN, INC.
SERVICO LANSING, INC.
SERVICO LAWRENCE II, INC.
SERVICO LAWRENCE, INC.
SERVICO MANAGEMENT CORPORATION
SERVICO MANAGEMENT CORP.
SERVICO MANHATTAN, INC.
SERVICO MANHATTAN II, INC.
SERVICO MARKET CENTER, INC.
SERVICO MARYLAND, INC.
SERVICO MELBOURNE, INC.
SERVICO METAIRIE, INC.
SERVICO NEW YORK, INC.
SERVICO NIAGARA FALLS, INC.
SERVICO NORTHWOODS, INC.
SERVICO OMAHA CENTRAL, INC.
SERVICO OMAHA, INC.
SERVICO OPERATIONS CORPORATION
SERVICO PENSACOLA 7200, INC.
SERVICO PENSACOLA 7330, INC.
SERVICO PENSACOLA, INC.:
SERVICO ROLLING MEADOWS, INC.
SERVICO ROSEVILLE, INC.
SERVICO SAGINAW, INC.
SERVICO SILVER SPRING, INC.
SERVICO SUMMERVILLE, INC.
SERVICO TUCSON, INC.
SERVICO WEST DES MOINES, INC.
SERVICO WEST PALM BEACH, INC.
SERVICO WICHITA, INC.
SERVICO WINDSOR, INC.
SERVICO WINTER HAVEN, INC.
SERVICO WORCESTER, INC.
SERVICO, INC.
SHARON MOTEL ENTERPRISES, INC.
SHC OF DELAWARE, INC.
SHEFFIELD MOTEL ENTERPRISES, INC.
SIOUX CITY HOSPITALITY, LP
By: Fourth Street Hospitality, Inc.,
as General Partner
SIXTEEN HOTELS, INC.
STEVENS CREEK HOSPITALITY, INC..
W.V.B.M., INC.
WASHINGTON MOTEL ENTERPRISES, INC.
WILPEN, INC.
WORCESTER HOSPITALITY ASSOCIATES,
LIMITED PARTNERSHIP
By: Servico Worcester, Inc.,
as General Partner
By: /s/ Daniel E. Ellis
------------------------------------
Title: Vice President
AGENT:
MORGAN STANLEY SENIOR FUNDING, INC.
Individually and as Agent
By: /s/ Stephen Hannan
------------------------------------
Title: Vice President
Address: 1221 Avenue of the Americas
New York, New York 10020
LENDERS:
MORGAN STANLEY SENIOR FUNDING, INC.
By: /s/ Stephen Hannan
------------------------------------
Title: Vice President
LEHMAN COMMERCIAL PAPER INC.
By: /s/ Francis X. Gilhool
------------------------------------
Title: Authorized Signatory
FRONTING BANK:
MORGAN STANLEY SENIOR FUNDING, INC.
By: /s/ Stephen Hannan
------------------------------------
Title: Vice President
ANNEX A
to
REVOLVING CREDIT AND GUARANTY AGREEMENT
Dated as of December 31, 2001
COMMITMENT COMMITMENT
BANK AMOUNT PERCENTAGE
- ---- ----------- ----------
Morgan Stanley Senior Funding, Inc. $12,500,000 50%
Address for Notice:
Lehman Commercial Paper, Inc. $12,500,000 50%
Address for Notice:
Total $25,000,000 100%
----------- ----------
Exhibit A to the
Revolving Credit and
Guaranty Agreement
FORM OF ASSIGNMENT AND ACCEPTANCE
AGREEMENT dated as of ___________, _____ among [NAME OF ASSIGNOR] (the
"Assignor") and [NAME OF ASSIGNEE] (the "Assignee").
WHEREAS, this Assignment and Acceptance (the "Agreement") relates to
the DIP Credit Agreement dated as of December 31, 2001 among Lodgian, Inc. (the
"Borrower"), the Assignor and the other DIP Lenders party thereto, the
Guarantors party thereto and Morgan Stanley Senior Funding, Inc., as Agent (the
"Agent") (as amended from time to time, the "DIP Credit Agreement");
WHEREAS, as provided under the DIP Credit Agreement, the Assignor has
a Commitment to make Loans to the Borrower and participate in Letters of Credit
in an aggregate principal amount at any time outstanding not to exceed $______;
[WHEREAS, Loans made to the Borrower by the Assignor under the DIP
Credit Agreement in the aggregate principal amount of $________ are outstanding
at the date hereof;]
[WHEREAS, Letters of Credit with a total amount available for drawing
thereunder of $___________ are outstanding at the date hereof; and]
WHEREAS, the Assignor proposes to assign to the Assignee all of the
rights of the Assignor under the DIP Credit Agreement in respect of a portion
of its Revolving Commitment thereunder in an amount equal to $_________ (the
"Assigned Amount"), together with a corresponding portion of each of its
outstanding Loans and Letter of Credit Outstandings and the Assignee proposes
to accept such assignment and assume the corresponding obligations of the
Assignor under the DIP Credit Agreement;
NOW, THEREFORE, in consideration of the foregoing and the mutual
agreements contained herein, the parties hereto agree as follows:
SECTION 1. Definitions. All capitalized terms not otherwise defined
herein have the respective meanings set forth in the DIP Credit Agreement.
SECTION 2. Assignment. The Assignor hereby assigns and sells to the
Assignee all of the rights of the Assignor under the DIP Credit Agreement to
the extent of the Assigned Amount and a corresponding portion of each of its
outstanding Loans and Letter of Credit Outstandings, and the Assignee hereby
accepts such assignment from the
Assignor and assumes all of the obligations of the Assignor under the DIP
Credit Agreement to the extent of the Assigned Amount and the corresponding
portion of each of its Loans and Letter of Credit Outstandings. Upon the
execution and delivery hereof by the Assignor and the Assignee [and by the
Borrower, the Agent and the Fronting Bank](1) and the payment of the amounts
specified in Section 3 required to be paid on the date hereof (i) the Assignee
shall, as of the date hereof, succeed to the rights and be obligated to perform
the obligations of a DIP Lender under the DIP Credit Agreement with a
Commitment in an amount equal to the Assigned Amount and acquire the rights of
the Assignor with respect to a corresponding portion of each of its outstanding
Loans and (ii) the Commitment of the Assignor shall, as of the date hereof, be
reduced by the Assigned Amount, and the Assignor shall be released from its
obligations under the DIP Credit Agreement to the extent such obligations have
been assumed by the Assignee. The assignment provided for herein shall be
without recourse to the Assignor.
SECTION 3. Payments. As consideration for the assignment and sale
contemplated in Section 2 hereof, the Assignee shall pay to the Assignor on the
date hereof in Federal funds the amount heretofore agreed between them.(2)
Commitment fees and letter of credit participation fees accrued before the date
hereof are for the account of the Assignor and such fees accruing on and after
the date hereof with respect to the Assigned Amount are for the account of the
Assignee. Each of the Assignor and the Assignee agrees that if it receives any
amount under the DIP Credit Agreement that is for the account of the other
party hereto, it shall receive the same for the account of such other party to
the extent of such other party's interest therein and promptly pay the same to
such other party.
[SECTION 4. Consent of the Agent and the Fronting Bank. This Agreement
is conditioned upon the consent of the Agent and each Fronting Bank pursuant to
Section 10.03(b) of the DIP Credit Agreement.](3)
SECTION 5. Non-Reliance on Assignor, etc. By executing and delivering
this Assignment and Acceptance, the Assignor and the Assignee confirm and agree
with each other as follows: (i) other than the representation and warranty that
it is the legal and beneficial owner of the interest being assigned free and
clear of any adverse claim, the Assignor makes no representation or warranty
and assumes no responsibility with respect to any statements, warranties or
representations made in or in connection with the DIP
- ---------------
(1) Delete if consent is not required.
(2) Amount should combine principal together with accrued
interest and breakage compensation, if any, to be paid by the Assignee, net of
any portion of any upfront fee to be paid by the Assignor to the Assignee. It
may be preferable in an appropriate case to specify these amounts generically
or by formula rather than as a fixed sum.
(3) Delete if consent is not required.
A-2
Credit Agreement or any of the other Loan Documents or the execution, legality,
validity, enforceability, genuineness, sufficiency or value of the DIP Credit
Agreement or any of the other Loan Documents; (ii) the Assignor makes no
representation or warranty and assumes no responsibility with respect to the
financial condition of the Borrower or any Guarantor or the performance or
observance by the Borrower or any Guarantor of any of its obligations under the
DIP Credit Agreement or any of the other Loan Documents or any other instrument
or document furnished pursuant hereto, (iii) the Assignee confirms that it has
received a copy of the DIP Credit Agreement and the other Loan Documents,
together with copies of the financial statements referred to in Section 3.04
and such other documents and information as it has deemed appropriate to make
its own credit analysis and decision to enter into this Assignment and
Acceptance; (iv) the Assignee will, independently and without reliance upon the
Agent, the Assignor or any other DIP Lender and based on such documents and
information as it shall deem appropriate at the time, continue to make its own
credit decisions in taking or not taking action under the DIP Credit Agreement;
(v) the Assignee appoints and authorizes the Agent to take such action as agent
on its behalf and to exercise such powers under the DIP Credit Agreement as are
delegated to the Agent by the terms of the DIP Credit Agreement, together with
such powers as are reasonably incidental thereof; and (vi) the Assignee agrees
that it will perform in accordance with the terms all obligations that by the
terms of th DIP Credit Agreement are required to be performed by it as a DIP
Lender.
SECTION 6. Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York.
SECTION 7. Counterparts. This Agreement may be signed in any number of
counterparts, each of which shall be an original, with the same effect as if
the signatures thereto and hereto were upon the same instrument.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be executed and delivered by their duly authorized officers as of the date
first above written.
[NAME OF ASSIGNOR]
By:
--------------------------------------
Name:
Title:
A-3
[NAME OF ASSIGNEE]
By:
--------------------------------------
Name:
Title:
[The undersigned consent to the foregoing assignment.
MORGAN STANLEY SENIOR FUNDING, INC.,
as Agent
By:
--------------------------------------
Name:
Title:]
MORGAN STANLEY SENIOR FUNDING, INC.,
as Fronting Bank
By:
--------------------------------------
Name:
Title:]
A-4
Exhibit B to the
Revolving Credit and
Guaranty Agreement
FORM OF NOTE
New York, New York
____________, 200_
For value received, LODGIAN, INC., a Delaware corporation (the
"BORROWER"), promises to pay to the order of [NAME OF DIP LENDER] (the
"LENDER") or registered assigns, the unpaid principal amount of each Loan made
by the Lender to the Borrower pursuant to the Credit Agreement referred to
below on the dates provided for in the Credit Agreement. The Borrower promises
to pay interest on the unpaid principal amount of each such Loan on the dates
and at the rate or rates and as provided for in the Credit Agreement. All
required cash payments of principal and interest shall be made in lawful money
of the United States in Federal or other immediately available funds at the
office of Morgan Stanley Senior Funding, Inc., as Agent, New York, New York.
All Loans made by the Lender, the respective Types of such Loans and
all repayments of the principal thereof shall be recorded by the Lender and, if
the Lender so elects in connection with any transfer or enforcement hereof,
appropriate notations to evidence the foregoing information with respect to
each such Loan then outstanding may be endorsed by the Lender on the schedule
attached hereto, or on a continuation of such schedule attached to and made a
part hereof; provided that the failure of the Lender to make any such
recordation or endorsement shall not affect the obligations of the Borrower
hereunder or under the Credit Agreement.
This note is one of the promissory notes referred to in the Revolving
Credit and Guaranty Agreement dated as of December 31, 2001 among Lodgian,
Inc., the Subsidiaries named therein, the Lenders party thereto, and Morgan
Stanley Senior Funding, Inc., as Agent (as amended from time to time, the
"CREDIT AGREEMENT"). Terms defined in the Credit Agreement are used herein with
the same meanings. Reference is made to the Credit Agreement for provisions for
the prepayment hereof and the acceleration of the maturity hereof.
This note shall be governed by and construed in accordance with the
laws of the State of New York.
LODGIAN, INC.
By
---------------------------------------
Name:
Title:
LOANS AND PAYMENTS OF PRINCIPAL
Amount of
Amount of Principal Notation
Date Loan Type Repaid Made By
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B-2
Exhibit C to the
Revolving Credit and
Guaranty Agreement
FORM OF INTERIM ORDER
C-1
Exhibit D to the
Revolving Credit and
Guaranty Agreement
FORM OF SECURITY AND
PLEDGE AGREEMENT
D-1
Exhibit E to the
Revolving Credit and
Guaranty Agreement
FORM OF OPINION OF COUNSEL
E-1
SCHEDULE 1.01(a)
EXISTING JOINT VENTURES
I. COLUMBUS HOSPITALITY ASSOCIATES, LIMITED PARTNERSHIP
General Partner: Servico Columbus, Inc. (30%)
Limited Partners: (70%)
II. MACON HOTEL ASSOCIATES, L.L.C.
Members: Impac Hotel Group, LLC (60% ordinary member);
PCG/Macon Investment Corp. (40% ordinary member)
III.MELBOURNE HOSPITALITY ASSOCIATES, LIMITED PARTNERSHIP
General Partner: Servico Melbourne, Inc. (50%)
Limited Partners: (50%)
IV. NEW ORLEANS AIRPORT MOTEL ASSOCIATES, LTD
General Partner: New Orleans Airport Motel Enterprises, Inc. (50%)
Limited Partners: (50%)
V. SERVICO CENTRE ASSOCIATES, LTD.
General Partner: Palm Beach Motel Enterprises, Inc. (50%)
Limited Partners: (50%)
SCHEDULE 3.05
SUBSIDIARIES
I. 1075 HOSPITALITY, L.P.
General Partner: Stevens Creek Hospitality, Inc. (51%)
Limited Partner: Lodgian Acquisition, L.L.C. (49%)
II. 12801 NWF BEVERAGE, INC.
Shareholder: Servico Houston, Inc.
III. ALBANY HOTEL, INC.
Shareholder: Lodgian Financing Corp.
IV. AMI OPERATING PARTNERS, L.P.
General Partner: AMIOP Acquisition Corp.
Limited Partner: Lodgian Financing Corp.
V. AMIOP ACQUISITION CORP.
Shareholder: Lodgian Financing Corp.
VI. APICO HILLS, INC.
Shareholder: Lodgian Financing Corp.
VII. APICO INNS OF GREEN TREE, INC.
Shareholder: Lodgian Financing Corp.
VIII. APICO INNS OF PENNSYLVANIA, INC.
Shareholder: Sharon Motel Enterprises
IX. APICO INNS OF PITTSBURGH, INC.
Shareholder: Servico Operations Corp.
X. APICO MANAGEMENT CORP.
Shareholder: Servico Operations Corp.
XI. ATLANTA-BOSTON SPE, INC.
Shareholder: Impac Hotel Group, L.L.C.
XII. ATLANTA-BOSTON HOLDINGS LLC
Member: Impac Hotel Group L.L.C.
XIII. ATLANTA-BOSTON LODGING LLC
Managing Member: Atlanta - Boston SPE, Inc.
Ordinary Member: Atlanta - Boston Holdings, LLC
XIV. ATLANTA-HILLSBORO LODGING, L.L.C.
Member: Lodgian Financing Corp.
XV. BRECKSVILLE HOSPITALITY, INC.
Shareholder: Servico Operations Corporation
XVI. BRECKSVILLE HOSPITALITY, L.P.
General Partner: Brecksville Hospitality, Inc. (51%)
Limited Partner: Lodgian Acquisition L.L.C. (49%)
XVII. BRUNSWICK MOTEL ENTERPRISES, INC.
Shareholder: Lodgian Financing Corp.
XVIII. COLUMBUS HOSPITALITY ASSOCIATES, LIMITED PARTNERSHIP
General Partner: Servico Columbus, Inc. (30%)
Limited Partners: (50%)
XIX. DEDHAM BEVERAGE MANAGEMENT, INC.
Shareholder: Impac Hotel Group, LLC.
XX. DEDHAM LODGING ASSOCIATES I, LIMITED PARTNERSHIP
General Partner: Impac SPE #3, Inc.
Limited Partner: Impac Hotel Group L.L.C.
XXI. DOTHAN HOSPITALITY 3053, INC.
Shareholder: Lodgian Financing Corp.
XXII. DOTHAN HOSPITALITY 3071, INC.
Shareholder: Lodgian Financing Corp.
XXIII. EAST WASHINGTON HOSPITALITY LIMITED PARTNERSHIP
General Partner: Servico East Washington, Inc. (51%)
Limited Partner: Servico Tucson, Inc. (49%)
XXIV. EUROPEAN VENTURES, INC.
Shareholder: Servico Operations Corp.
XXV. FAYETTEVILLE MOTEL ENTERPRISES, INC.
Shareholder: Lodgian Financing Corp.
XXVI. FORT WAYNE HOSPITALITY ASSOCIATES II, LIMITED PARTNERSHIP
General Partner: Servico Fort Wayne II, Inc. (51%)
Limited Partner: Lodgian Acquisition LLC (49%)
XXVII. FOURTH STREET HOSPITALITY, INC.
Shareholder: Servico Operations Corp.
XXVIII. GADSDEN HOSPITALITY, INC.
Shareholder: Lodgian Financing Corp.
XXIX. GREAT SOUTHERN MINING CO., INC.
Shareholder: Servico Operations Corp.
XXX. GROUPERS & COMPANY SEAFOOD RESTAURANT
Shareholder: Servico Operations Corp.
XXXI. HARRISBURG MOTEL ENTERPRISES, INC.
Shareholder: Servico Operations Corp.
XXXII. HEARTLANDS GARDEN GRILLE, INC
Shareholder: Servico Operations Corp.
XXXIII. HILTON HEAD MOTEL ENTERPRISES, INC.
Shareholder: Servico Operations Corp.
XXXIV. IMPAC DEVELOPMENT AND CONSTRUCTION L.L.C.
Managing Member: Impac SPE #5, Inc.
Other Member: Impac Hotel Group L.L.C.
XXXV. IMPAC HOLDINGS III, L.L.C.
Member: Impac Hotel Group, LLC
XXXVI. IMPAC HOTEL GROUP, L.L.C.
Shareholder: Lodgian, Inc.
XXXVII. IMPAC HOTEL MANAGEMENT L.L.C.
Managing Member: Impac SPE #4, Inc. (1%)
Other Member: Impac Hotel Group, L.L.C. (99%)
XXXVIII. IMPAC HOTELS I, L.L.C.
Managing Member: Impac SPE #1
Ordinary Member: Lodgian Financing Corp.
XXXIX. IMPAC HOTELS II, L.L.C.
Shareholder, Managing Member: Impac SPE #2, Inc. (1%)
Other Member: Impac Hotel Group, LLC (99%)
XL. IMPAC HOTELS III, L.L.C.
Member: Impac SPE #6, Inc. (1%)
Managing Member: Impac Holdings III, LLC (99%)
XLI. IMPAC SPE #1, INC.
Shareholder: Lodgian Financing Corp.
XLII. IMPAC SPE #2, INC.
Shareholder: Impac Hotel Group, LLC
XLIII. IMPAC SPE #3, INC.
Shareholder: Impac Hotel Group, LLC.
XLIV. IMPAC SPE #4, INC.
Shareholder: Impac Hotel Group, LLC.
XLV. IMPAC SPE #5, INC.
Shareholder: Impac Hotel Group, LLC.
XLVI. IMPAC SPE #6, INC.
Shareholder: Impac Hotel Group, LLC
XLVII. ISLAND MOTEL ENTERPRISES, INC.
Shareholder: Servico Operations Corp.
XLVIII. KDS CORPORATION
Shareholder: Servico Operations Corp.
XLIX. KINSER MOTEL ENTERPRISES, INC.
Shareholder: Servico Operations Corp.
L. LAFAYETTE BEVERAGE MANAGEMENT, INC
LI. LAWRENCE HOSPITALITY ASSOCIATES, L.P.
General Partner: Servico Lawrence, Inc. (51%)
Limited Partner: Servico Lawrence II, Inc. (49%)
LII. LITTLE ROCK LODGING ASSOCIATES, LIMITED PARTNERSHIP
General Partner: Lodgian Richmond SPE, Inc. (1%)
Limited Partner: Lodgian Financing Corp. (99%)
LIII. LODGIAN ACQUISITION, LLC.
Member: Lodgian Financing Corp.
LIV. LODGIAN AMI, INC.
Shareholder: Servico Operations Corp.
LV. LODGIAN ANAHEIM, INC.
Shareholder: Lodgian Financing Corp.
LVI. LODGIAN AUSTIN BEVERAGE CORP.
Shareholder: Servico Austin, Inc.
LVII. LODGIAN DALLAS BEVERAGE CORP.
Shareholder: Impac Hotels I, LLC
LVIII. LODGIAN FINANCING CORP.
Shareholder: Lodgian, Inc.
LIX. LODGIAN FLORIDA, INC.
Shareholder: Servico Operations Corp.
LX. LODGIAN HOTELS, INC.
Shareholder: Lodgian, Inc.
LXI. LODGIAN MANAGEMENT CORP.
Shareholder: Servico Operations Corp.
LXII. LODGIAN MARKET CENTER BEVERAGE CORP.
Shareholder: Servico Market Center, Inc.
LXIII. LODGIAN MOUNT LAUREL, INC.
Shareholder: Lodgian Financing Corp.
LXIV. LODGIAN ONTARIO, INC.
Shareholder: Lodgian Financing Corp.
LXV. LODGIAN RICHMOND SPE, INC.
Shareholder: Lodgian Financing Corp.
LXVI. LODGIAN RICHMOND, L.L.C.
Members: Lodgian Financing Corp. (99% ordinary member);
Lodgian Richmond SPE, Inc.
(1% managing member)
LXVII. LODGIAN YORK MARKET STREET, INC.
Shareholder: Servico Operations Corp.
LXVIII. MANHATTAN HOSPITALITY ASSOCIATES, L.P.
General Partners: Servico Manhattan, Inc. (51%)
Limited Partner: Servico Manhattan II, Inc. (49%)
LXIX. MACON HOTEL ASSOCIATES, L.L.C.
Members: Impac Hotel Group, LLC (60% ordinary member);
PCG/Macon Investment
Corp. (40% ordinary member)
LXX. MCKNIGHT MOTEL, INC.
Shareholder: Sharon Motel Enterprises, Inc.
LXXI. MELBOURNE HOSPITALITY ASSOCIATES, LIMITED PARTNERSHIP
General Partner: Servico Melbourne, Inc. (50%)
Limited Partners: (50%)
LXXII. MINNEAPOLIS MOTEL ENTERPRISES, INC.
Shareholder: Lodgian Financing Corp.
LXXIII. MOON AIRPORT MOTEL, INC.
Shareholder: Servico Operations Corp.
LXXIV. MULLIGAN'S, INC.
Shareholder: Servico Operations Corp.
LXXV. NEW ORLEANS AIRPORT MOTEL ASSOCIATES, LTD
General Partner: New Orleans Airport Motel
Enterprises, Inc. (50%)
Limited Partners: (50%)
LXXVI. NEW ORLEANS AIRPORT MOTEL ENTERPRISES, INC.
Shareholder: Servico Operations Corp.
LXXVII. NH MOTEL ENTERPRISES, INC.
Shareholder: Lodgian Financing Corp.
LXXVIII. PALM BEACH MOTEL ENTERPRISES, INC.
Shareholder: Lodgian Financing Corp.
LXXIX. PENMOCO, INC.
Shareholder: Servico Operations Corp.
LXXX. RALEIGH MOTEL ENTERPRISES, INC.
Shareholder: Servico Operations Corp.
LXXXI. RALEIGH-DOWNTOWN ENTERPRISES, INC.
Shareholder: Servico Operations Corp.
LXXXII. ROYCE HOLDING CORP.
Shareholder: Servico Operations Corp.
LXXXIII. ROYCE HOTEL CORPORATION OF DELAWARE
Shareholder: Servico, Inc.
LXXXIV. ROYCE MANAGEMENT CORP. OF GEORGIA
Shareholder: Servico Operations Corp.
LXXXV. SAGINAW HOSPITALITY, LIMITED PARTNERSHIP
General Partner: Servico Saginaw, Inc. (51%)
Limited Partner: Lodgian Acquisition, LLC (49%)
LXXXVI. SECOND FAYETTEVILLE MOTEL ENTERPRISES, INC.
Shareholder: Sharon Motel Enterprises, Inc.
LXXXVII. SECOND PALM BEACH MOTEL ENTERPRISES, INC.
Shareholder: Sharon Motel Enterprises, Inc.
LXXXVIII. SERVICO ACQUISITION CORP.
Shareholder: Servico, Inc.
LXXXIX. SERVICO AUSTIN, INC.
Shareholder: Lodgian Financing Corp.
XC. SERVICO CEDAR RAPIDS, INC.
Shareholder: Lodgian Financing Corp.
XCI. SERVICO CENTRE ASSOCIATES, LTD.
General Partner: Palm Beach Motel Enterprises, Inc.
Limited Partner: (50%)
XCII. SERVICO COLESVILLE, INC.
Shareholder: Lodgian Financing Corp.
XCIII. SERVICO COLUMBIA II, INC.
Shareholder: Servico Operations Corporation
XCIV. SERVICO COLUMBIA, INC.
Shareholder: Lodgian Financing Corp.
XCV. SERVICO COLUMBUS, INC.
Shareholder: Servico Operations Corp.
XCVI. SERVICO CONCORD, INC.
Shareholder: Servico Operations Corporation
XCVII. SERVICO COUNCIL BLUFFS, INC.
Shareholder: Servico Operations Corp.
XCVIII. SERVICO EAST WASHINGTON, INC.
Shareholder: Servico Operations Corp.
XCIX. SERVICO FLAGSTAFF, INC.
Shareholder: Lodgian Financing Corp.
C. SERVICO FORT WAYNE II, INC.
Shareholder: Servico Operations Corp.
CI. SERVICO FORT WAYNE, INC.
Shareholder: Servico Operations Corp.
CII. SERVICO FRISCO, INC.
Shareholder: Servico Operations Corp.
CIII. SERVICO FT. PIERCE, INC.
Shareholder: Lodgian Financing Corp.
CIV. SERVICO GRAND ISLAND, INC.
Shareholder: Lodgian Financing Corp.
CV. SERVICO HILTON HEAD, INC.
Shareholder: Lodgian Financing Corp.
CVI. SERVICO HOSPITALITY, INC.
Shareholder: Servico Operations Corp.
CVII. SERVICO HOTELS I, INC.
Shareholder: KDS Corporation
CVIII. SERVICO HOTELS II, INC.
Shareholder: KDS Corporation
CIX. SERVICO HOTELS III, INC.
Shareholder: KDS Corp.
CX. SERVICO HOTELS IV, INC.
Shareholder: KDS Corporation
CXI. SERVICO HOUSTON, INC.
Shareholder: Lodgian Financing Corp.
CXII. SERVICO, INC.
Shareholder: Lodgian, Inc.
CXIII. SERVICO INVESTMENT COMPANY OF DELAWARE, INC.
Shareholder: Sheffield Motel Enterprises, Inc.
CXIV. SERVICO JAMESTOWN, INC.
Shareholder: Lodgian Financing Corp.
CXV. SERVICO LANSING, INC.
Shareholder: Servico Operations Corp.
CXVI. SERVICO LAWRENCE II, INC.
Shareholder: Servico Operations Corp.
CXVII. SERVICO LAWRENCE, INC.
Shareholder: Servico Operations Corp.
CXVIII. SERVICO MANAGEMENT CORPORATION
Shareholder: Servico Operations Corp.
CXIX. SERVICO MANAGEMENT CORP.
Shareholder: Servico Operations Corp.
CXX. SERVICO MANHATTAN, INC.
Shareholder: Servico Operations Corporation
CXXI. SERVICO MANHATTAN II, INC.
Shareholder: Servico Operations Corp.
CXXII. SERVICO MARKET CENTER, INC.
Shareholder: Lodgian Financing Corp.
CXXIII. SERVICO MARYLAND, INC.
Shareholders: Lodgian Financing Corp.
CXXIV. SERVICO MELBOURNE, INC.
Shareholder: Servico Operations Corp.
CXXV. SERVICO METAIRIE, INC.
Shareholder: Lodgian Financing Corp.
CXXVI. SERVICO NEW YORK, INC.
Shareholder: Lodgian Financing Corp.
CXXVII. SERVICO NIAGARA FALLS, INC.
Shareholder: Lodgian Financing Corp.
CXXVIII. SERVICO NORTHWOODS, INC.
Shareholder: Lodgian Financing Corp.
CXXIX. SERVICO OMAHA CENTRAL, INC.
Shareholder: Servico Operations Corp.
CXXX. SERVICO OMAHA, INC.
Shareholder: Servico Operations Corp.
CXXXI. SERVICO OPERATIONS CORPORATION
Shareholder: Servico, Inc.
CXXXII. SERVICO PENSACOLA 7200, INC.
Shareholder: Lodgian Financing Corp.
CXXXIII. SERVICO PENSACOLA 7330, INC.
Shareholder: Lodgian Financing Corp.
CXXXIV. SERVICO PENSACOLA, INC.
Shareholder: Lodgian Financing Corp.
CXXXV. SERVICO ROLLING MEADOWS, INC.
Shareholder: Lodgian Financing Corp.
CXXXVI. SERVICO ROSEVILLE, INC.
Shareholder: Lodgian Financing Corp.
CXXXVII. SERVICO SAGINAW, INC.
Shareholder: Servico Operations Corporation
CXXXVIII. SERVICO SILVER SPRING, INC.
Shareholder: Lodgian Financing Corp.
CXXXIX. SERVICO SUMMERVILLE, INC.
Shareholder: Servico Operations Corp.
CXL. SERVICO TUCSON, INC.
Shareholder: Servico Operations Corp.
CXLI. SERVICO WEST DES MOINES, INC.
Shareholder: Servico Operations Corp.
CXLII. SERVICO WEST PALM BEACH, INC.
Shareholder: Lodgian Financing Corp.
CXLIII. SERVICO WICHITA, INC.
Shareholder: Servico Operations Corp.
CXLIV. SERVICO WINDSOR, INC.
Shareholder: Lodgian Financing Corp.
CXLV. SERVICO WINTER HAVEN, INC.
Shareholder: Lodgian Financing Corp.
CXLVI. SERVICO WORCESTER, INC.
Shareholder: Servico Operations Corp.
CXLVII. SHARON MOTEL ENTERPRISES, INC.
Shareholder: Servico Operations Corp.
CXLVIII. SHC OF DELAWARE, INC.
Shareholder: Servico, Inc., or Servico Operations Corp.
CXLIX. SHEFFIELD MOTEL ENTERPRISES, INC.
Shareholder: Lodgian Financing Corp.
CL. SIOUX CITY HOSPITALITY, LP
General Partner: Fourth Street Hospitality, Inc.
Limited Partner: Lodgian Acquisition, LLC.
CLI. SIXTEEN HOTELS, INC.
Shareholders: AMI Operating Parthers, LP (70%);
6 Lodgian employees (30%)
CLII. STEVENS CREEK HOSPITALITY, INC.
Shareholder: Servico Operations Corp.
CLIII. W.V.B.M., INC.
Shareholder: Impac Hotel Group, L.L.C.
CLIV. WASHINGTON MOTEL ENTERPRISES, INC.
Shareholder: Servico Operations Corp.
CLV. WILPEN, INC.
Shareholder: Sharon Motel Enterprises, Inc.
CLVI. WORCESTER HOSPITALITY ASSOCIATES, LIMITED PARTNERSHIP
General Partner: Servico Worcester, Inc.
Limited Partner: Lodgian Acquisition, LLC
SCHEDULE 3.06
LIENS
OWNER OF RECORD LIENS OF RECORD
--------------- ---------------
Servico Austin, Inc. Double L. Insulation Co, Inc. ($13,486.88)
Palm Beach Hotel Enterprises, Inc., a Florida Corporation, as A-1 Enterprises ($43,618.60)
the sole general partner of Servico Centre Associates, Ltd.
Twin Towers, Inc. ($111,533.00)
Servico Windsor, Inc. Twin Towers, Inc. ($)
Maintenance Warehouse/America Corp.
Servico Winter Haven, Inc. ($3,250.81)
Servico Hotels II, Inc. DJB Enterprises ($92,620)
B&F Contracting ($346,633.72)
Island Motel Enterprises, Inc. and Penmoco, Inc. Banc One Funding Corporation has a lien on all assets in
connection with the Holiday Inn, Jekyll Island
Lodgian AMI, Inc. Banc One Funding Corporation has a lien on all assets in
connection with the Holiday Inn, Inner Harbor
Lodgian AMI, Inc. Banc One Funding Corporation has a lien on all assets in
connection with the Holiday Inn, Lancaster, PA
Lodgian AMI, Inc. Banc One Funding Corporation has a lien on all assets in
connection with the Holiday Inn International Airport (BWI)
Lodgian AMI, Inc. Banc One Funding Corporation has a lien on all assets in
connection with the Holiday Inn, Glen Burnie, MD
Servico, Inc. Banc One Funding Corporation has a lien on all of the Stock
of Lodgian AMI, Inc, Island Motel Enterprises, Inc. and
Penmoco, Inc
Worcester Hospitality Associates Limited Partnership Lehman Brothers Holdings, Inc. has a lien on all assets in
connection with the Holiday Inn, Worcester, MA
Fort Wayne Hospitality Associates II, Limited Partnership Lehman Brothers Holdings, Inc. has a lien on all assets in
connection with the Holiday Inn, Fort Wayne, IN
Servico Frisco, Inc. Lehman Brothers Holdings, Inc. has a lien on all assets in
connection with the Holiday Inn, Frisco, CO
Apico Inns of Pittsburgh, Inc. Lehman Brothers Holdings, Inc. has a lien on all assets in
connection with the Holiday Inn, Monroeville, PA
Melbourne Hospitality Associates Limited Partnership Lehman Brothers Holdings, Inc. has a lien on all assets in
connection with the Holiday Inn, Melbourne, FL
Impac Hotels II, L.L.C. Capital Company of America LLC has a lien on all assets
in connection with its hotels in Denver, CO; Coconut Grove, FL;
Florence, KY; Fort Mitchell KY; Hamburg, NY; Syracuse, NY;
Cincinnati, OH; Tulsa, OK; Jackson, TN; Clarksburg, WV;
Fairmont, WV; Morgantown, WV
-1-
OWNER OF RECORD LIENS OF RECORD
--------------- ---------------
Impac Hotels III, L.L.C. Capital Company of America LLC has a lien
on all assets in connection with its
hotels in Augusta, GA; Lafayette, LA;
Merrimack, NH; Memphis TN; Colchester, VT;
Servico Council Bluffs, Inc. GMAC Commercial Mortgage Corporation and Orix Corp.
have a lien on all assets in connection with the Best Western,
Council Bluffs, IA
Servico West Des Moines, Inc. GMAC Commercial Mortgage Corporation and Orix Corp.
have a lien on all assets in connection with the Best Western,
West Des Moines, IA
Servico Omaha Central, Inc. GMAC Commercial Mortgage Corporation and Orix Corp.
have a lien on all assets in connection with the Best Western
Central, NE
Servico Omaha, Inc. GMAC Commercial Mortgage Corporation and Orix Corp.
have a lien on all assets in connection with the Sheraton Inn,
Omaha, NE
Servico Wichita, Inc. GMAC Commercial Mortgage Corporation and Orix Corp.
have a lien on all assets in connection with the Holiday Inn,
Wichita Airport, Wichita, KS
Brecksville Hospitality, L.P. GMAC Commercial Mortgage Corporation has a lien on all
assets in connection with the Holiday Inn, Richfield, OH
Sioux City Hospitality, L.P. GMAC Commercial Mortgage Corporation has a lien on all
assets in connection with the Hilton Hotel, Sioux City, IA
1075 Hospitality, L.P. GMAC Commercial Mortgage Corporation has a lien on all
assets in connection with the Holiday Inn, August, GA
Servico Fort Wayne, Inc. DLJ/Column Financial, Inc./CrimiMae have a lien on all
assets in connection with the Fort Wayne Hilton, Fort Wayne,
IN
Washington Motel Enterprises, Inc. DLJ/Column Financial, Inc./CrimiMae have a lien on all
assets in connection with the Holiday Inn Meadowlands,
Washington PA
Servico Hotels I, Inc. DLJ/Column Financial, Inc./CrimiMae have a lien on all
assets in connection with the Holiday Inn Phoenix West,
Phoenix, AZ
Servico Hotels II, Inc. DLJ/Column Financial, Inc./CrimiMae have a lien on all
assets in connection with the Radisson, Phoenix, AZ
Servico Hotels III, Inc. DLJ/Column Financial, Inc./CrimiMae have a lien on all
assets in connection with the Holiday Inn, Palm Desert, CA
Servico Hotels IV, Inc. DLJ/Column Financial, Inc./CrimiMae have a lien on all
assets in connection with the Holiday Inn, Santa Fe, NM
Hilton Head Motel Enterprises, Inc. DLJ/Column Financial, Inc./CrimiMae have a lien on all
assets in connection with the Holiday Inn, Hilton Head, SC
Moon Airport Motel, Inc. DLJ/Column Financial, Inc./CrimiMae have a lien on all
assets in connection with the Royce Hotel, Pittsburgh Airport
McKnight Motel, Inc. Column Financial, Inc./CrimiMae have a lien on all assets in
connection with the Holiday Inn, McKnight Road
East Washington Hospitality Limited Partnership DLJ/Column Financial, Inc. have a lien on all assets in
connection with the Holiday Inn Airport East, Phoenix,. AZ
-2-
OWNER OF RECORD LIENS OF RECORD
--------------- ---------------
Bloomington Kinser Hotel Associates Local Oklahoma Bank, N.A. has a lien on all assets in
connection with the Holiday Inn, Bloomington, IN
Servico Lansing, Inc. DLJ/Column Financial, Inc./CrimiMae have a lien on all
assets in connection with the Holiday Inn, Lansing, MI
Dedham Lodging Associates I, Limited Partnership GMAC
Commercial Mortgage Corporation has a lien
on all assets in connection with the
Residence Inn, Dedham, MA
Impac Hotel Group, LLC Fidelity Investments has a lien on all of the stock in Macon
Hotel Associates, LLC
Lodgian Financing Corp. Morgan Stanley Senior Funding, Inc. has a lien on all assets
Servico, Inc. Morgan Stanley Senior Funding, Inc. has a lien on all assets
of Servico, Inc.
Impac Hotel Group, Inc. Morgan Stanley Senior Funding, Inc. has a lien on all assets
of Impac Hotel Group, Inc.
Sheffield Motel Enterprises, Inc. Morgan Stanley Senior Funding, Inc. has a lien on all assets
of Sheffield Motel Enterprises, Inc.
Dothan Hospitality 3053, Inc. Morgan Stanley Senior Funding, Inc. has a lien on all assets
of Dothan Hospitality 3053, Inc.
Dothan Hospitality 3071, Inc. Morgan Stanley Senior Funding, Inc. has a lien on all assets
of Dothan Hospitality 3071, Inc.
Gadsden Hospitality, Inc. Morgan Stanley Senior Funding, Inc. has a lien on all assets
of Gadsden Hospitality, Inc.
Lodgian Anaheim Inc. Morgan Stanley Senior Funding, Inc. has a lien on all assets
of Lodgian Anaheim Inc.
Lodgian Ontario Inc. Morgan Stanley Senior Funding, Inc. has a lien on all assets
of Lodgian Ontario Inc.
Servico Pensacola, Inc. Morgan Stanley Senior Funding, Inc. has a lien on all assets
of Servico Pensacola, Inc.
Servico Pensacola 7200, Inc. Morgan Stanley Senior Funding, Inc. has a lien on all assets
of Servico Pensacola 7200, Inc.
Servico Pensacola 7330, Inc. Morgan Stanley Senior Funding, Inc. has a lien on all assets
of Servico Pensacola 7330, Inc.
Servico Ft. Pierce, Inc. Morgan Stanley Senior Funding, Inc. has a lien on all assets
of Servico Ft. Pierce, Inc.
AMI Operating Partners, L.P. Morgan Stanley Senior Funding, Inc. has a lien on all assets
of Ami Operating Partners, L.P.
Servico Centre Associates, Ltd. Morgan Stanley Senior Funding, Inc. has a lien on all assets
of Servico Centre
Servico West Palm Beach, Inc. Morgan Stanley Senior Funding, Inc. has a lien on all assets
of Servico West Palm Beach, Inc.
Servico Winter Haven, Inc. Morgan Stanley Senior Funding, Inc. has a lien on all assets
of Servico Winter Haven, Inc.
Albany Hotel, Inc. Morgan Stanley Senior Funding, Inc. has a lien on all assets
of Albany Hotel, Inc.
Servico Northwoods, Inc. Morgan Stanley Senior Funding, Inc. has a lien on all assets
of Servico Northwoods, Inc.
Brunswick Motel Enterprises, Inc. Morgan Stanley Senior Funding, Inc. has a lien on all assets
of Brunswick Motel Enterprises, Inc.
-3-
OWNER OF RECORD LIENS OF RECORD
--------------- ---------------
Little Rock Lodging Assoicates I, L.P. Morgan Stanley Senior Funding, Inc. has a lien on all assets
of Little Rock Lodging Associates I, L.P.
Atlanta Hillsboro Lodging, LLC Morgan Stanley Senior Funding, Inc. has a lien on all assets
of Atlanta Hillsboro Lodging, LLC
Lodgian Richmond, L.L.C. Morgan Stanley Senior Funding, Inc. has a lien on all assets
of Lodgian Richmond, L.L.C.
Servico Rolling Meadows, Inc. Morgan Stanley Senior Funding, Inc. has a lien on all assets
of Servico Rolling Meadows, Inc.
Servico Cedar Rapids, Inc. Morgan Stanley Senior Funding, Inc. has a lien on all assets
of Servico Cedar Rapids, Inc.
Servico Metairie, Inc. Morgan Stanley Senior Funding, Inc. has a lien on all assets
of Servico Metairie, Inc.
Servico Columbia, Inc. Morgan Stanley Senior Funding, Inc. has a lien on all assets
of Servico Columbia, Inc.
Servico Colesville, Inc. Morgan Stanley Senior Funding, Inc. has a lien on all assets
of Servico Colesville, Inc.
Servico Maryland, Inc. Morgan Stanley Senior Funding, Inc. has a lien on all assets
of Servico Maryland, Inc.
NH Motel Enterprises, Inc. Morgan Stanley Senior Funding, Inc. has a lien on all assets
of NH Motel Enterprises, Inc.
Minneapolis Motel Enterprises, Inc. Morgan Stanley Senior Funding, Inc. has a lien on all assets
of Minneapolis Motel Enterprises, Inc.
Servico Roseville, Inc. Morgan Stanley Senior Funding, Inc. has a lien on all assets
of Servico Roseville, Inc.
Lodgian Mount Laurel, Inc. Morgan Stanley Senior Funding, Inc. has a lien on all assets
of Lodgian Mount Laurel, Inc.
Servico Jamestown, Inc. Morgan Stanley Senior Funding, Inc. has a lien on all assets
of Servico Jamestown, Inc.
Servico New York, Inc. Morgan Stanley Senior Funding, Inc. has a lien on all assets
of Servico New York, Inc.
Servico Niagara Falls, Inc. Morgan Stanley Senior Funding, Inc. has a lien on all assets
of Servico Niagara Falls, Inc.
Servico Grand Island, Inc. Morgan Stanley Senior Funding, Inc. has a lien on all assets
of Servico Grand Island, Inc.
Fayetteville Motel Enterprises, Inc. Morgan Stanley Senior Funding, Inc. has a lien on all assets
of Servico Fayetteville Motel Enterprises, Inc.
Apico Inns of Green Tree, Inc. Morgan Stanley Senior Funding, Inc. has a lien on all assets
of Apico Inns of Green Tree, Inc.
Apico Hills, Inc. Morgan Stanley Senior Funding, Inc. has a lien on all assets
of Apico Hills, Inc.
Servico Hilton Head, Inc. Morgan Stanley Senior Funding, Inc. has a lien on all assets
of Servico Hilton Head, Inc.
Servico Austin, Inc. Morgan Stanley Senior Funding, Inc. has a lien on all assets
of Servico Austin, Inc.
Servico Market Center, Inc. Morgan Stanley Senior Funding, Inc. has a lien on all assets
of Servico Market Center, Inc.
-4-
OWNER OF RECORD LIENS OF RECORD
--------------- ---------------
Servico Houston, Inc. Morgan Stanley Senior Funding, Inc. has a lien on all assets
of Servico Houston, Inc.
Atlanta-Boston Lodging, LLC Wachovia Securities has a lien on all assets in connection
with the Comfort Inn, Revere, MA
Lawrence Hospitality Associates, L.P. Chase has a Leasehold Mortgage on the Holiday Inn,
Lawrence, KS
Manhattan Hospitality Associates, L.P. Chase has a Leasehold Mortgage on the Holiday Inn,
Manhattan, KS
Columbus Hospitality Associates, L.P. First Union has a lien on all assets of Columbus Hospitality
Associates, L.P.
Together with all liens for capitalized leases of and or purchase money
security interest in office equipment, vehicles and other similar items of the
Borrower and the Guarantors.
-5-
SCHEDULE 3.11
LITIGATION
DJB Enterprises, et al. v. Servico Radisson Phoenix AZ CV2001-014882
Hotels II, Inc.
Jimmie Nell Hollis v. Servico, et al. Holiday Inn - Dothan AL CV-97-009A
Hampton Inn
Waldman v. Impac, et al GA 99-CV-671-GET
Gowri Kailas v. Servico Metarie, Inc. Quality Inn Metarie LA 557-966
Hospitality Restoration & Builders, NY 11999-2538
Inc. v. Servico, Inc., et al
Best Western International v. Servico Clarion Charleston SC
Northwoods, Inc.
DJB Enterprises, et al. v. Servico Superior Court - 8/28/01 Foreclosure of lien -
Hotels II, Inc. Maricopa County Plaintiffs seek
$438,000
Jimmie Nell Hollis v. Servico, et al. Circuit Court - Houston Employee alleges
County non payment of
bonus - seeks in
excess of $1M
Waldman v. Impac, et al U.S. District Court - 3/11/99 Breach of Fiduciary
Northern District of Duty - Plaintiff
Georgia seeks in excess of
$1M. Insurance
coverage available
(80%)
Gowri Kailas v. Servico Metarie, Inc. 24th Judicial Circuit 9/8/00 Suit for return of
deposit - $500,000
Hospitality Restoration & Builders, Supreme Court - State of 6/15/99 Construction
Inc. v. Servico, Inc., et al New York - Erie County Dispute
Best Western International v. Servico Threatened - Breach
Northwoods, Inc. of contract - Claim
is $402,000
SCHEDULE 3.12
INTELLECTUAL PROPERTY
Federal Trademark and Servicemark
Registrations and Applications:
To the best of the Borrower's knowledge, the attached represents all
material trademarks, trademark applications, service marks, service mark
applications owned by the Borrower.
Borrower owns no material United States patents, patent applications,
or material United States trademark licenses or patent licenses.
SCHEDULE 3.14
PRE-PETITION INDEBTEDNESS
LENDER OBLIGOR AMOUNT OUTSTANDING
- ------ ------- ------------------
Banc One Capital Funding Island Motel Enterprises, Inc.(*) $3,696,000
Corporation Penmoco, Inc. (Holiday Inn, Jekyll Island)(*)
Guarantors: Servico Concord, Inc.(*), Lodgian
AMI, Inc.(*) and Lodgian, Inc.(*)
Banc One Capital Funding Lodgian AMI, Inc. (Holiday Inn International $13,852,000
Corporation Airport (BWI))(*)
Guarantors: Servico Concord, Inc.(*), Penmoco,
Inc.(*), Island Motel Enterprises, Inc.(*) and Lodgian,
Inc.(*)
Banc One Capital Funding Lodgian AMI, Inc. (Holiday Inn Lancaster, PA)(*) $4,589,000
Corporation Guarantors: Servico Concord, Inc.,(*) Penmoco,
Inc.(*), Island Motel Enterprises, Inc.(*) and Lodgian,
Inc.(*)
Banc One Capital Funding Lodgian AMI, Inc. (Holiday Inn Inner Harbor)(*) $29,504,000
Corporation Guarantors: Servico Concord, Inc.(*), Penmoco,
Inc.(*), Island Motel Enterprises, Inc.(*) and Lodgian,
Inc.(*)
Banc One Capital Funding Lodgian AMI, Inc. (Holiday Inn Glen Burnie, $2,924,000
Corporation MD)(*)
Guarantors: Servico Concord, Inc.,(*) Penmoco,
Inc.(*), Island Motel Enterprises, Inc.(*) and Lodgian,
Inc.(*)
Banc One Capital Funding Dedham Lodging Associates I, Limited $6,000,000
Corporation Partnership (Residence Inn, Dedham, MA)(*)
Guarantor: Lodgian, Inc.(*)
Lehman Brothers Holdings, Inc. Worcester Hospitality Associates Limited $7,270,000
(Holiday Inn, Worcester, MA)(*)
Guarantor: Servico, Inc.(*)
Lehman Brothers Holdings, Inc Fort Wayne Hospitality Associates II, Limited $1,791,000
Partnership (Holiday Inn, Fort Wayne, IN)(*)
Guarantor: Servico, Inc.(*)
Lehman Brothers Holdings, Inc Servico Frisco, Inc. (Holiday Inn, Frisco, CO)(*) $4,863,000
Guarantor: Servico, Inc.(*)
Lehman Brothers Holdings, Inc Apico Inns of Pittsburgh, Inc. (Holiday Inn, $4,749,000
Monroeville, PA)(*)
Guarantor: Servico, Inc.(*)
LENDER OBLIGOR AMOUNT OUTSTANDING
- ------ ------- ------------------
Lehman Brothers Holdings, Inc Melbourne Hospitality Associates Limited $ 5,279,000
Partnership (Holiday Inn, Melbourne, FL)(*)
Guarantor: Servico, Inc.(*)
Capital Company of America Impac Hotels II, L.L.C. $108,652,000
LLC Impac Hotels III, L.L.C.
Guarantors: Impac Hotel Group, LLC(*) and
Lodgian, Inc.(*)
GMAC Commercial Mortgage Servico Council Bluffs, Inc. (Best Western, $ 15,464,000
Corporation and Orix Corp. Council Bluffs, IA)
Servico West Des Moines, Inc. (Best Western,
West Des Moines, IA)
Servico Omaha Central, Inc. (Best Western
Central, Omaha, NE)
Servico Omaha, Inc. (Sheraton Inn, Omaha, NE)
Servico Wichita, Inc. (Holiday Inn, Wichita
Airport, Wichita, KS
Guarantor: Servico, Inc.(*)
GMAC Commercial Mortgage Servico Lansing, Inc. (Holiday Inn, Lansing, MI) $ 5,313,000
Corporation Guarantor: Servico, Inc.(*)
GMAC Commercial Mortgage Brecksville Hospitality, L.P. (Holiday Inn, $ 11,584,000
Corporation Richfield, OH)
Sioux City Hospitality, L.P. (Hilton Hotel,
Sioux City, IA)
1075 Hospitality, L.P. (Holiday Inn, Augusta,
GA).
DLJ/Column Financial, Servico Fort Wayne, Inc. (Fort Wayne Hilton, $ 26,003,000
Fort Inc./CrimiMae
Wayne, IN)(*)
Washington Motel Enterprises, Inc. (Holiday Inn
Meadowlands, Washington, PA)(*)
Servico Hotels I, Inc. (Holiday Inn Phoenix West,
Phoenix, AZ)(*)
Servico Hotels II, Inc. (Radison, Phoenix, AZ)(*)
Servico Hotels III, Inc. (Holiday Inn, Palm Desert,
CA)(*)
Servico Hotels IV, Inc. (Holiday Inn, Santa Fe, NM)(*)
Hilton Head Motel Enterprises, Inc. (Holiday Inn,
Hilton Head, SC)(*)
Moon Airport Motel, Inc. (Royce Hotel,
Pittsburgh Airport)(*)
Column Financial, Inc./CrimiMae McKnight Motel, Inc. (Holiday Inn, McKnight $ 3,358,000
Road)(*)
DLJ/Column Financial, Inc. East Washington Hospitality Limited Partnership $ 9,390,000
(Holiday Inn Select Airport East, Phoenix, AZ)
LENDER OBLIGOR AMOUNT OUTSTANDING
- ------ ------- ------------------
Local Oklahoma Bank, N.A. Bloomington Kinser Hotel Associates (Holiday $ 2,554,000
Inn, Bloomington, IN)
Guarantor: Kinser Hotel Enterprises, Inc.
Morgan Stanley Senior Funding, Lodgian Financing Corporation(*) $189,634,900
Inc. Guarantors:
Servico, Inc.(*)
Impac Hotel Group, LLC(*)
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.(*)
AMI Operating Partners, L.P.(*)
Servico Centre Associates, Ltd.(*)
Servico West Palm Beach, Inc.(*)
Servico Winter Haven, Inc.(*)
Albany Hotel, Inc.(*)
Servico Northwoods, Inc.(*)
Brunswick Motel Enterprises, Inc.(*)
Little Rock Lodging Associates I,L.P.(*)
Atlanta Hillsboro Lodging, LLC(*)
Lodgian Richmond, L.L.C.(*)
Servico Rolling Meadows, 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.(*)
LENDER OBLIGOR AMOUNT OUTSTANDING
- ------ ------- ------------------
Servico Market Center, Inc.(*)
Servico Houston, Inc.(*)
Wachovia Securities, Inc. Atlanta-Boston Lodging, LLC (Comfort Inn, $ 3,422,000
Boston/Revere, MA)
Guarantor: Impac Hotel Group, LLC(*)
$6,750,000 City of Lawrence, Lawrence Hospitality Associates, L.P. (Holiday $ 5,852,000
Kansas Commercial Development Inn, Lawrence, KS)(*)
Revenue Refunding Bonds Guarantor: Servico, Inc.(*)
(Holiday Inn Project) Senior
Series 1997A and $2,330,000
City of Lawrence, Kansas
Commercial Development
Revenue Refunding Bonds
(Holiday Inn Project) Subordinate
Series 1997B
$6,750,000 City of Manhattan, Manhattan Hospitality Associates, L.P. (Holiday $ 5,852,000
Kansas Commercial Development Inn, Manhattan, KS)(*)
Revenue Refunding Bonds Guarantor: Servico, Inc.(*)
(Holiday Inn Project) Senior
Series 1997A and $2,350,000
City of Manhattan, Kansas
Commercial Development
Revenue Refunding Bonds
(Holiday Inn Project) Subordinate
Series 1997B
12 1/4Senior Subordinated Notes Lodgian Financing Corp $200,000,000
due 2009 Guarantors:
Servico, Inc.(*)
Sheffield Motel Enterprises, Inc.(*)
Dothan Hospitality 3053, Inc.(*)
Dothan Hospitality 3071, Inc.(*)
Gadsden Hospitality, Inc.(*)
Servico Flagstaff, Inc.(*)
Lodgian Anaheim Inc.(*)
Lodgian Ontario Inc.(*)
Servico Pensacola, Inc.(*)
Servico Pensacola 7200, Inc.(*)
Servico Pensacola 7330, Inc.(*)
Servico Ft. Pierce, Inc.(*)
AMI Operating Partners, L.P.(*)
Servico Centre Associates, Ltd.(*)
Servico West Palm Beach, Inc.(*)
Servico Winter Haven, Inc.(*)
Servico Silver Spring, Inc.(*)
Albany Hotel, Inc.(*)
LENDER OBLIGOR AMOUNT OUTSTANDING
- ------ ------- ------------------
Servico Northwoods, Inc.(*)
Servico Windsor, Inc.(*)
Brunswick Motel Enterprises, Inc.(*)
Little Rock Lodging Associates I,L.P.(*)
Atlanta Hillsboro Lodging, LLC(*)
Lodgian Richmond, L.L.C.(*)
Servico Rolling Meadows, 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.(*)
Servico Hilton Head, Inc.(*)
Servico Austin, Inc.(*)
Servico Market Center, Inc.(*)
Servico Houston, Inc.(*)
Crests Lodgian Capital Trust I $195,331,000
Servico, Inc.(*)
First Union Columbus Hospitality Associates, L.P. $ 5,788,386
(*) Low Leverage Guarantor
SCHEDULE 3.15
HOTEL PROPERTIES
PART 1 - LOW LEVERAGE GUARANTORS
See Attached
PART II - HIGH LEVERAGE GUARANTORS
HOTEL ADDRESS OWNER OF RECORD
- ----- ------- ---------------
Marriot Hotel 16455 East 40(th) Circle, Aurora, CO 80011 Impac Hotels II, LLC
Mayfair House 3000 Florida Ave, Miami, FL 33131 Impac Hotels II, LLC
Holiday Inn N. Miami 12210 Biscayne Blvd., Miami, FL 33181 Impac Hotels II, LLC
Fairfield Inn 201 Boy Scout Rd., Augusta, GA 30909 Impac Hotels III, LLC
Holiday Inn 1075 Stevens Creek Rd., Augusta, GA 30907 1075 Hospitality, L.P.
Holiday Inn 1710 Kinser Pike, Bloomington, IN 47404 Kinser Motel Enterprises, Inc.
Quality Inn 3537 W. Broadway, Council Bluffs, IA 51501 Servico Council Bluffs, Inc.
Four Points Hotel 11040 Hickman Rd., West Des Moines, IA 50325 Servico West Des Moines, Inc.
Hilton Hotel 707 4(th) St., Sioux City, IA 51101 Sioux City Hospitality, L.P.
Holiday Inn 5500 W. Kellogg, Wichita, KS 67209 Servico Wichita, Inc.
Holiday Inn 8050 Holiday Place, Florence, KY 41042 Impac Hotels II, LLC
Holiday Inn 2100 Dixie Hwy, Ft. Mitchell, KY 41011 Impac Hotels II, LLC
Courtyard 214 E. Kaliste Saloom Rd., Lafayette, LA 70508 Impac Hotels III, LLC
Clarion Hotel 3650 S. 72(nd) St., Omaha, NE 68124 Servico Omaha Central, Inc.
Four Points Hotel 4888 S. 118(th) St., Omaha, NE 68137 Servico Omaha, Inc.
Fairfield Inn 4 Amherst Rd., Merrimack, NH 03054 Impac Hotels III, LLC
Holiday Inn 100 Farrell Rd., Syracuse, NY 13209 Impac Hotels II, LLC
Clarion Hotel Raleigh Downtown Enterprises,
Downtown 320 Hillsborough St., Raleigh, NC 27603 Inc.
Holiday Inn Downtown 800 West 8(th) St., Cincinnati, OH 45203 Impac Hotels II, LLC
Holiday Inn Cleveland 4742 Brecksville Rd., Richfield, OH 49286 Brecksville Hospitality, Inc..
Courtyard 3340 South 79(th) East Ave., Tulsa, OK 74145 Impac Hotels II, LLC
Fairfield Inn 535 Wiley Parker Rd., Jackson, TN 38305 Impac Hotels III, LLC
Holiday Inn Sycamore 6101 Shelby Oaks Dr., Memphis, TN 38134 Impac Hotels II, LLC
Fairfield Inn 15 South Park Drive, Colchester, VT 05446 Impac Hotels III, LLC
Holiday Inn 100 Lodgeville Rd., Clarksburg, WV 23630 Impac Hotels II, LLC
Holiday Inn I-79 and Old Grafton Rd., Fairmont, WV 26554 Impac Hotels II, LLC
HOTEL ADDRESS OWNER OF RECORD
- ----- ------- ---------------
Holiday Inn 1400 Saratoga Ave., Morgantown, WV 26505 Impac Hotels II, LLC
Holiday Inn 5440 Camp Road, Hamburg, NY 14075 Impac Hotels II, LLC
Columbus Hospitality Associates,
Holiday Inn 175 East Town St., Columbus, OH 43215 L.P.
SCHEDULE 3.16
LEASES
PART I - LOW LEVERAGE GUARANTORS
HOTEL LEASE TYPE LESSOR EXPIRATION ANNUAL GROUND RENT
- ----- ---------- ------ ---------- ------------------
Holiday Inn BWI(**) Ground Lease Investment Company Term ends 9/11/2003, with $713,000
Baltimore, MD Dated 8/24/71 all options 9/11/2053.
890 Elkridge Landing Rd. Counsel advised that 10
Linthicum Heights, MD. year option exercised in
21090 1985 purporting to extend
to 9/11/13 be exercised
Lessee- Lodgian AMI, Inc. again no later than 9/10/02.
Holiday Inn(*) Ground Lease Poly Choke Company, Inc. 4/30/2022 $113,000
363 Roberts Street Dated 3/11/70
East Hartford, CT 08106
Lessee- AMI Operating
Partners, L.P.
Holiday Inn Ground Lease A.O. Krisch, Joel Krisch 10/7/2020 $ 26,000
Glen Burnie, MD(**) Dated 5/10/68 and Rosalle K. Shaftman (term expired 10/7/00,
6323 Governor Ritchie Hwy. renewal for 20 years given
Glen Burnie, MD 21061 in 1985)
Lessee- Lodgian AMI, Inc.
HOTEL LEASE TYPE LESSOR EXPIRATION ANNUAL GROUND RENT
- ----- ---------- ------ ---------- ------------------
Holiday Inn Inner Harbor(**) Ground Lease Kallope Pappas, Helen P. 12/31/2017 $389,000
Baltimore, MD Dated 12/31/62 Thomas, Louisa Pappas,
310 N. Lombard Street Chrysanthe Pappas, Anna
Baltimore, MD 21201 Pappas, Harry P. Pappas
Lessee- Lodgian AMI, Inc.
Holiday Inn East Ground Lease Paul A. Herr 6/30/2004 $67,000
Lancaster, PA Dated 1/10/69
521 Greenfield Rd.
Lancaster, PA 17601
Lessee- AMI Operating
Partners, L.P. [VERIFY]
Crowne Plaza Parking Garage UDC-Ten Eyck 12/20/2056 $709,000 (reflects an
State & Lodge Streets Dated 12/20/79 Development Corporation- aggregate number which
Ten Eyck Plaza III includes payments under
Albany, NY 12207(*) parking lease).
Lessee- Albany Hotel, Inc.
Crowne Plaza Ground Lease UDC-Ten Eyck 12/20/2056 $709,000 (reflects an
State & Lodge Streets Dated 12/20/79 Development Corporation- aggregate number which
Ten Eyck Plaza III includes payments under
Albany, NY 12207(*) ground lease)
Lessee- Albany Hotel, Inc.
Courtyard Ground Lease City Line Properties, Inc. Term expires 12/31/2017 $163,137
Boston, MA Dated 2/23/88
(f/k/a Comfort Inn)(*)
100 Morris Street
Revere, MA 02151
Tenant- Atlanta- Boston
Holdings, LLC
HOTEL LEASE TYPE LESSOR EXPIRATION ANNUAL GROUND RENT
- ----- ---------- ------ ---------- ------------------
Courtyard Parking Lot Eagle Road Realty Trust Term expires 12/31/2017 $49,440
Boston, MA Lease dated
(f/k/a Comfort Inn) 3/20/97
100 Morris Street
Revere, MA 02151
Tenant- Atlanta- Boston
Holdings, LLC
Fairfield Inn Ground Pizzagalli Investment 12/30/2015 $102,000
Colchester, VT(**) Sublease Company
15 South Park Drive Dated 5/16/89
Colchester, VT 05446
Tenant- Impac Hotels III,
L.L.C.
Crowne Plaza Air Rights City of Cedar Rapids, Iowa 10/13/2075 $101,000 (reflects an aggregate
350 1(st) Ave. NE Lease number inclusive of annual
Cedar Rapids, IA 53401 Dated 10/14/76 rental payments on air rights,
ballroom lease and parking
Tenant- Servico Cedar lease)
Rapids, Inc.
Crowne Plaza Lease of City of Cedar Rapids, Iowa 10/13/2075 $101,000 (reflects an aggregate
350 1(st) Ave. NE Ballroom Space number inclusive of annual
Cedar Rapids, IA(*) 53401 Dated 10/26/77 rental payments on air rights,
ballroom lease and parking
Tenant- Servico Cedar lease)
Rapids, Inc.
HOTEL LEASE TYPE LESSOR EXPIRATION ANNUAL GROUND RENT
- ----- ---------- ------ ---------- ------------------
Crowne Plaza Lease of City of Cedar Rapids, Iowa 10/13/2075 $101,000 (reflects an
350 1(st) Ave. NE Parking Spaces aggregate number inclusive
Cedar Rapids, IA(*) 53401 Dated 5/18/77 of annual rental payments
on air rights, ballroom
Tenant- Servico Cedar lease and parking lease)
Rapids, Inc.
Crowne Plaza Pedestrian City of Cedar Rapids, Iowa 3/31/2029 subject to $1.00/year
350 1(st) Ave. NE Passage Lessee right to terminate
Cedar Rapids, IA(*) 53401 Dated 5/23/79
Tenant- Servico Cedar
Rapids, Inc.
Hilton Parking Garage Fort Wayne Downtown Expiration at the end of the $54,000
Ft. Wayne, IN(*) Dated 6/4/85 Traffic Management Board useful engineering life of
1020 S. Calhoun St. the parking garage or
Ft. Wayne, IN 46802 Hotel closure.
Tenant- Servico Ft. Wayne,
Inc.
Holiday Inn Parking Lot City of Jamestown 2003 $11,000
Jamestown, NY(*) Lease
150 W. 4(th) Street Dated 10/5/77
Jamestown, NY 14701
Tenant- Servico Jamestown,
Inc.
Holiday Inn Ground Lease Jekyll Island State Park 2/28/2014 $139,000
Jekyll Island, GA(**) dated 10/23/72 Authority
200 South Beachview Dr.
Jekyll Island, GA 31527
Tenant- Penmoco, Inc. and
Island Motel Enterprises, Inc.
HOTEL LEASE TYPE LESSOR EXPIRATION ANNUAL GROUND RENT
- ----- ---------- ------ ---------- ------------------
Holiday Inn Lawrence, KS(**) Ground Lease City of Lawrence, Kansas Term expires when bonds Rents sufficient to pay the
200 McDonald Dr. Dated 1/1/97 paid in full principal, or premium, if any,
Lawrence, KS 66044 and interest on project bonds
and related expenses.
Tenant- Lawrence
Hospitality Associates, L.P.
Holiday Inn Ground Lease City of Manhattan, Kansas Term expires when bonds Rents sufficient to pay the
Manhattan, KS(**) Dated 1/1/97 paid in full principal, or premium, if any,
530 Richards Dr. and interest on project bonds
Manhattan, KS 66502 and related expenses.
Tenant- Manhattan
Hospitality Associates, L.P.
French Quarter Suites (A) Davis (A) Martha Sutton under (A) 9/30/2038 $33,000
Memphis, TN(*) Ground Lease the Davis lease (B) 9/30/2038
2144 Madison Ave. dated 4/26/72 (B) Horace and Ann
Memphis, TN 38104 (B) Proctor Procter under the Proctor
Ground Lease Lease
Tenant- Impac Hotels I, LLC dated 8/24/72
Holiday Inn Select Parking Lot City of Niagra Falls 7/1/07 $50,000
Niagara Falls, NY(*) Agreement
(f/k/a Clarion Hotel) Dated 7/21/97
300 Third Street
Niagra Falls., NY 14303
Tenant- Servico New York,
Inc.
HOTEL LEASE TYPE LESSOR EXPIRATION ANNUAL GROUND RENT
- ----- ---------- ------ ---------- ------------------
Holiday Inn Ground Lease Motel Properties, Inc. 11/30/2014 $250,000
Raleigh, NC(**) Dated 8/26/69
320 Hillsborough Street,
Raleigh, NC 27603
Tenant -Raleigh Downtown
Enterprises, Inc.
Holiday Inn Select Ground Lease Niagara County Industrial 3/28/01 $50,000
Niagara Falls, NY(*) Dated 3/29/96 Development Agency
(f/k/a Clarion Hotel)
300 Third Street
Niagra, Falls, NY 14303
Tenant- Servico New York,
Inc.
Holiday Inn Select East Ground Lease S& J Investments, L.L.C. 12/31/2049 $670,000
Phoenix, AZ(**) Dated 7/30/84
4300 E. Washington
Phoenix, AZ 85034
Tenant- East Washington
Hospitality, LP
Holiday Inn Ground Lease City of Sheffield, Alabama 11/30/2077 Per lease agreement -during
4900 Hatch Blvd. Dated 2/6/81 renewal period (which
Sheffield, AL 35660(*) commenced 11/30/1997), basis
rent in the amount of $100
Tenant- Sheffield Motel annually plus such other
Enterprises, Inc. amounts as lessee agreed to pay
under the "net lease",
including, without limitation
taxes and utilities.
HOTEL LEASE TYPE LESSOR EXPIRATION ANNUAL GROUND RENT
- ----- ---------- ------ ---------- ------------------
Holiday Inn Sioux City, IA Parking Space City of Sioux City, Iowa 12/31/2007 Minimum fee of $2,580/ month
Rental plus additional rent for each
Tenant - Sioux City Agreement month in which the dollar
Hospitality, L.C. dated 1/1998 value of the use of the "ramp"
exceeds $4,000 based upon
current parking rates.
SCHEDULE 3.17
EXISTING INVESTMENTS
Investments in the ownership of the capital stock or other evidence of an
ownership interest in each of the entities is set forth in Schedules 1.01(a)
and 3.05
Deposit accounts and securities accounts as attached hereto.
LODGIAN, INC
Attributed DIP to Low Leverage Properties SCHEDULE 3.15
(in $000's)
Proportional Attributed
Location Address Owner of Record EBITDA DIP
- -------------------------------------------------------------------------------------------------------------------------------
Residence Inn 259 Elm Street, Dedham Lodging 2.2% $ 539
Dedham, MA Dedham, MA 02026 Associates I, LP
BANC ONE BANC ONE 2.2% 539
Holiday Inn 4859 McKnight Rd., McKnight Motel, Inc. 1.7% 415
McKnight SHG II, PA Pittsburgh, PA 15237
COLUMN/CRIMI MAE COLUMN/CRIMI MAE 1.7% 415
Holiday Inn 1500 North 51st Ave., Servico Hotels I, Inc. 1.5% 370
Phoenix West, AZ Phoenix, AZ 85043
Radisson 3333 East University Dr., Servico Hotels II, Inc. 1.4% 338
Phoenix Hotel, AZ Phoenix, AZ 85034
Holiday Inn Express 74675 Hwy 111, Servico Hotels III, Inc. 1.5% 370
Palm Desert, CA Palm Desert, CA 92260
Fort Wayne 1020 S. Calhoun St., Servico Ft. Wayne, Inc. 1.4% 362
Hilton - Servico Ft. Wayne, IN 46802
Holiday Inn 4048 Cerrillos Rd., Servico Hotels IV, Inc. 1.0% 248
Santa Fe, NM Santa Fe, NM 87505
Crowne Plaza 1160 Thorn Run Rd. Ext., Moon Airport Motel, Inc. 0.5% 121
Pittsburgh Airport Coraopolis, PA 15108
Holiday Inn 340 Racetrack Rd., Washington Motel 1.3% 333
Meadow Lands, PA Washington, PA 15301 Enterprises, Inc.
Holiday Inn 1 South Forest Beach Dr., Hilton Head Motel 2.8% 703
Hilton Head, SC Hilton Head, SC 29928 Enterprises, Inc.
DLJ/COLUMN/CRIMI MAE DLJ/COLUMN/CRIMI MAE 11.4% 2,845
Courtyard by Marriott 100 Morris St., Revere, Atlanta-Boston Lodging, LLC 1.5% 379
- Boston, MA MA 02151
FIRST UNION FIRST UNION 1.5% 379
Holiday Inn 7501 W. Saginaw Hwy, Servico Lansing, Inc. 3.2% 798
West Lansing, MI Lansing, MI 48917
GMAC GMAC 3.2% 798
Holiday Inn 1129 N. Summit Blvd., Servico Frisco, Inc. 1.0% 249
Frisco, CO Frisco, CO 80443
Holiday Inn 2605 North A1A, Melbourne Hospitality 2.5% 633
Melbourne, FL Indialantic, FL 32903 Associates
Holiday Inn 300 E. Washington Blvd., Fort Wayne Hospitality 0.5% 122
Fort Wayne, IN Ft. Wayne, IN 46802 Associates II, L.P.
Crowne Plaza 10 Lincoln Square, Worcester Hospitality 3.9% 965
Worcester, MA Worcester, MA 01608 Associates L.P.
Holiday Inn 2750 Mosside Blvd., Apico Inns of Pittsburgh, Inc. 1.5% 374
Monroeville, PA Monroeville, PA 15146
LEHMAN/CRIMI MAE LEHMAN/CRIMI MAE 9.4% 2,344
NON MSDW PROPERTIES 29.3% 7,319
LODGIAN, INC
Attributed DIP to Low Leverage Properties SCHEDULE 3.15
(in $000's)
Proportional Attributed
Location Address Owner of Record EBITDA DIP
- -------------------------------------------------------------------------------------------------------------------------------
Holiday Inn 4900 Hatch Blvd., Sheffield Motel 0.8% 201
Sheffield, AL Sheffield, AL 35660 Enterprises, Inc.
Holiday Inn 3053 Ross Clark, Dothan Hospitality 3053, Inc. 0.3% 68
Dothan, AL Dothan, AL 36301
Hampton Inn 3071 Ross Clark Circle, Dothan Hospitality 3071, Inc. 0.6% 142
Dothan, AL Dothan, AL 36301
Holiday Inn Express 801 Cleveland Ave., Gadsden Hospitality, Inc. 0.4% 100
Gadsden, AL Gadsden, AL 35954
Courtyard by Marriott 1001 McClain Rd., Impac Hotels I, LLC 1.3% 333
- - Bentonville, AR Bentonville, AR 72712
Residence Inn 1401 S. Shackleford Rd., Little Rock Lodging 1.2% 303
Little Rock, AR Little Rock, AR 72211 Associates, LLC
Holiday Inn 363 Roberts St., AMI Operating Partners, LP 0.8% 188
East Hartford, CT E. Hartford, CT 06108
Crowne Plaza 1601 Belvedere Rd., Royce Management Corp. 2.2% 562
West Palm Beach, FL West Palm Beach, FL 33406
Holiday Inn Express 6501 Pensacola Blvd., Servico Pensacola, Inc. 0.7% 187
Pensacola, FL Pensacola, FL 32505
Holiday Inn 7200 Plantation Rd., Servico Pensacola 7200, Inc. 0.9% 219
University Mall, FL Pensacola, FL 32504
Holiday Inn 1150 3rd St., SW, Servico Winter Haven, Inc. 1.4% 362
Winter Haven, FL Winter Haven, FL 33880
Hampton Inn 7330 Plantation Rd., Servico Pensacola 7330, Inc. 1.2% 298
Pensacola, FL Pensacola, FL 32504
Holiday Inn 5252 New Jesup Hwy, Brunswick Motel 0.9% 227
Brunswick, GA Brunswick, GA 31525 Enterprises, Inc.
Courtyard by Marriott 3332 Peachtree Rd., Impac Hotels I, LLC 4.4% 1,109
- Atlanta, GA Atlanta, GA 30326
Holiday Inn Hotel & 2265 Kingston Ct., Impac Hotels I, LLC 0.3% 71
Suites Marietta, GA Marietta, GA 30067
Fairfield Inn 1311 St. Augustine Rd., Impac Hotels I, LLC 0.9% 216
Valdosta, GA Valdosta, GA 31601
Holiday Inn 1309 St. Augustine Rd., Impac Hotels I, LLC 0.8% 200
Valdosta, GA Valdosta, GA 31601
Holiday Inn 3405 Algonquin Rd., Servico Rolling Meadows, Inc. 2.3% 586
Rolling Meadows, IL Rolling Meadows, IL 60008
Quality Hotel 2261 N. Causeway Blvd., Servico Metairie, Inc. 1.2% 297
Metairie, LA Metairie, LA 70001
Hilton Inn 5485 Twin Knolls Rd., Servico Columbia, Inc. 2.6% 661
Columbia, MD Columbia, MD 21045
Holiday Inn 8777 Georgia Ave., Servico Maryland, Inc. 3.6% 899
Silver Spring, MD Silver Spring, MD 20910
Holiday Inn 999 W. Patrick St., AMI Operating Partners, LP 1.3% 318
Frederick, MD Frederick, MD 21702
Holiday Inn 1100 Cromwell Bridge Rd., AMI Operating Partners, LP 1.4% 342
Cromwell Bridge, MD Towson, MD 21286
Holiday Inn 1800 Belmont Ave., AMI Operating Partners, LP 0.5% 129
Belmont, MD Baltimore, MD 21244
LODGIAN, INC
Attributed DIP to Low Leverage Properties SCHEDULE 3.15
(in $000's)
Proportional Attributed
Location Address Owner of Record EBITDA DIP
- -------------------------------------------------------------------------------------------------------------------------------
Crowne Plaza 350 1st Ave., NE, Servico Cedar Rapids, Inc. 1.8% 445
Cedar Rapids, IA Cedar Rapids, IA 52401
Holiday Inn 1201 West Country Rd. E, Minneapolis Motel 1.2% 303
Arden Hills/St. Paul, MN St. Paul, MN 55112 Enterprises, Inc.
Courtyard by Marriott 3835 Technology Dr., Impac Hotels I, LLC 1.0% 244
- - Paducah, KY Paducah, KY 42001
Courtyard by Marriott 46 Cavalier Blvd., Impac Hotels I, LLC 0.6% 140
- Florence, KY Florence, KY 41042
Hurstbourne Hotel, 9700 Blue Grass Parkway, Impac Hotels I, LLC 0.7% 170
Louisville,KY Louisville, KY 40299
Holiday Inn 4545 N. Lindbergh Blvd., Impac Hotels I, LLC 1.6% 397
St. Louis North, MO St. Louis, MO 63044
Crowne Plaza Ten Eyck Plaza, Albany Hotel, Inc. 2.6% 642
Albany, NY Albany, NY 12207
Holiday Inn Select 300 Third St., Servico New York, Inc. 1.8% 451
Niagara Falls, NY Niagara Falls, NY 14303
Four Points 114 Buffalo Ave., Servico Niagara Falls, Inc. 0.5% 120
Niagara Falls, NY Niagara Falls, NY 14303
Holiday Inn 150 W. 4th St., Servico Jamestown, Inc. 1.0% 248
Jamestown, NY Jamestown, NY 14701
Holiday Inn 100 Whitehaven Rd., Servico Grand Island, Inc. 0.4% 90
Grand Island, NY Grand Island, NY 14072
Holiday Inn 15471 Royalton Rd., Impac Hotels I, LLC 2.6% 653
Select Strongsville, OH Strongsville, OH 44136
Holiday Inn 401 Holiday Drive, Apico Inns of 1.7% 414
Greentree, PA Pittsburgh, PA 15220 Greentree, Inc.
Holiday Inn 915 Brinton Rd., Apico Hills, Inc. 0.2% 44
Parkway East, PA Pittsburgh, PA 15221
Doubletree Club 9461 Roosevelt Blvd., Impac Hotels I, LLC 2.2% 547
Philadelphia, PA Philadelphia, PA 19114
Holiday Inn 334 Arsenal Rd., AMI Operating 0.7% 167
York, PA York, PA 17402 Partners, LP
Hilton Inn 5500 Crooks Rd., NH Motel 2.8% 708
Northfield, MI Troy, MI 48098 Enterprises, Inc.
Clarion 7401 Northwoods Blvd., Servico Northwoods, Inc. 0.6% 161
Charleston, SC Charleston, SC 29406
Holiday Inn Sunspree 1601 N. Ocean Blvd., Impac Hotels I, LLC 1.2% 308
Myrtle Beach, SC Surfside Beach, SC 29575
French Quarter 2144 Madison Ave., Impac Hotels I, LLC 0.5% 116
Suites Memphis, TN Memphis, TN 38104
Crowne Plaza 12801 NW Freeway US 290, Servico Houston, Inc. 3.8% 958
Houston, TX Houston, TX 77040
Courtyard by Marriott 4350 Ridgemont Dr., Impac Hotels I, LLC 1.0% 246
- Abilene, TX Abilene, TX 79606
Holiday Inn 3401 South I-35, Servico Austin, Inc. 1.8% 451
Austin, TX Austin, TX 78741
Holiday Inn 1955 Market Center Blvd., Servico Market 0.5% 130
Market Center Dallas, TX Dallas, TX 75207 Center, Inc.
Holiday Inn Select 4441 Hwy 114 & Ester Blvd., Impac Hotels I, LLC 2.8% 706
DFW Airport, TX Irving, TX 75063
LODGIAN, INC
Attributed DIP to Low Leverage Properties SCHEDULE 3.15
(in $000's)
Proportional Attributed
Location Address Owner of Record EBITDA DIP
- -------------------------------------------------------------------------------------------------------------------------------
Holiday Inn Select 1855 Huron Church Road, Servico Windsor, Inc. 3.2% 805
Windsor, Ontario Windsor, Ontario,
Canada N9C 2L6
Morgan Stanley Pool
MORGAN STANLEY (SENIOR) MORGAN STANLEY (SENIOR) 70.7% 17,681
----- ------
100.0% 25,000
----- ------
Holiday Inn Select 4300 E. Washington, East Washington
Airport Phoenix, AZ Phoenix, AZ 85034 Associates, L.P
Holiday Inn 200 South Beachview Dr., Island Motel
Jekyll Island, GA Jekyll Island, GA 31527 Enterprises, Inc.
Holiday Inn 301 W. Lombard St., Lodgian AMI, Inc.
Inner Harbor, MD Baltimore, MD 21201
Holiday Inn 6323 Governor Ritchie Hwy, Lodgian AMI, Inc.
Glen Burnie, MD Glen Burnie, MD 21061
Holiday Inn 890 Linthicum Heights, Lodgian AMI, Inc.
BWI Airport, MD MD 21090
Holiday Inn 530 Richards Dr. Manhattan Hospitality
Manhattan, KS Manhattan, KS 66502 Associates, L.P
Holiday Inn 200 McDonald Dr., Lawrence Hospitality
Lawrence, KS Lawrence, KS 66044 Associates, L.P
Holiday Inn 521 Greenfield Rd., Lodgian AMI, Inc.
Lancaster, PA Lancaster, PA 17601
PAGE 1 OF 5
SCHEDULE 3.17
ACCOUNTS
BANK INFORMATION
LOCATION LOW
NUMBER LEVERAGE STATE ACCOUNT/PROPERTY DESCRIPTION BANK CONTACT
- ------ -------- ----- ---------------------------- ---- -------
210 y AL Holiday Inn Bank of America James Butler
220 y AL Holiday Inn Bank of America James Butler
230 y AL Hampton Inn Bank of America James Butler
240 y AL Holiday Inn Express Bank of America James Butler
410 y AZ HOLIDAY INN PHOENIX WEST Bank of America James Butler
410 y AZ Holiday Inn West Bank of America James Butler
420 y AZ RADISON PHOENIX AIRPORT Bank of America James Butler
420 y AZ Radisson Airport Bank of America James Butler
440 y AZ HOLIDAY INN PHOENIX AIRPORT EAST Bank of America James Butler
440 y AZ Holiday Inn Select Airport Bank of America James Butler
505 y AR COURTYARD BENTONVILLE Bank of America James Butler
505 y AR Courtyard Bank of America James Butler
560 y AR LITTLE ROCK RESIDENCE Bank of America James Butler
560 y AR Residence Inn Bank of America James Butler
630 y CA Holiday Inn Express Palm Desert Bank of America James Butler
630 y CA Holiday Inn Express Palm Desert Bank of America James Butler
707 CO Marriott (Denver Airport) Bank of America James Butler
725 y CO Holiday Inn Bank of America James Butler
850 y CT Holiday Inn Bank of America James Butler
1108 y FL OMNI WPB Bank of America James Butler
1108 y FL Crowne Plaza Bank of America James Butler
1113 y FL HOLIDAY INN EXPRESS PENSACOLA Bank of America James Butler
1113 y FL Holiday Inn Express Bank of America James Butler
1116 y FL HOLIDAY INN UNIVERSITY MALL Bank of America James Butler
1116 y FL Holiday Inn University Mall Bank of America James Butler
1132 y FL HOLIDAY INN WINTER HAVEN Bank of America James Butler
1132 y FL Holiday Inn Bank of America James Butler
1160 y FL HOLIDAY INN MELBOURNE OCEANFRT Bank of America James Butler
1168 y FL HAMPTON INN PENSACOLA Bank of America James Butler
1168 y FL Hampton Inn Bank of America James Butler
1178 FL Mayfair House Hotel Bank of America James Butler
1183 FL Holiday Inn North Bank of America James Butler
1206 y GA HOLIDAY INN BRUNSWICK Bank of America James Butler
1206 y GA Holiday Inn Bank of America James Butler
1207 y GA Holiday Inn Bank of America James Butler
1212 y GA COURTYARD BUCKHEAD Bank of America James Butler
1212 y GA Courtyard Buckhead Bank of America James Butler
1255 y GA HOLIDAY INN SANTE FE Bank of America James Butler
1255 y GA Holiday Inn Hotel & Suites Bank of America James Butler
1260 GA HOLIDAY INN 1-20 @ WASHINGTON Bank of America James Butler
1260 GA Holiday Inn Bank of America James Butler
1265 GA Fairfield Inn Bank of America James Butler
1280 y GA FAIRFIELD INN VALDOSTA Bank of America James Butler
1285 y GA HOLIDAY INN VALDOSTA Bank of America James Butler
1285 y GA Holiday Inn Bank of America James Butler
1310 y IL Holiday Inn Bank of America James Butler
1421 IN Holiday Inn Bank of America James Butler
1425 y IN Hilton Hotel Bank of America James Butler
1440 y IN Holiday Inn Hotel & Suites Bank of America James Butler
1502 y LA Quality Hotel & Conference Center Bank of America James Butler
1515 LA Courtyard Bank of America James Butler
1710 y MD COLUMBIA HILTON Bank of America James Butler
1710 y MD Hilton Inn Bank of America James Butler
1720 y MD Holiday Inn Bank of America James Butler
1765 y MD IMPAC HOTEL GROUP/HI INNER HARBOR Bank of America James Butler
1765 y MD Holiday Inn Inner Harbor Bank of America James Butler
1770 y MD HOLIDAY INN GLEN BURNIE Bank of America James Butler
1770 y MD Holiday Inn Baltimore South Bank of America James Butler
PHONE # ADDRESS 1 ADDRESS 2 CITY STATE POSTAL CODE
------- --------- --------- ---- ----- -----------
800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800 547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800 547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800 547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800 547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800 547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 70502
800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800 547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800 547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800 547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800 547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800 547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800 547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800 547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 70502
800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800 547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800 547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800 547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800 547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800 547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800 547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800 547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800 547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
ACCOUNT # ACCOUNT TYPE
--------- ------------
3267984468 COD Account
3267984476 COD Account
3267984484 COD Account
3267984492 COD Account
3276601772 Dep
3267984518 COD Account
3276601897 Dep
3267984526 COD Account
3276601764 Dep
3267984534 COD Account
3276601756 Dep
3267984542 COD Account
5043070526 Dep
3267984559 COD Account
3272205933 COD Account
3267984583 Dep
3267984617 COD Account
3267984625 COD Account
3267984633 COD Account
3276601780 Dep
3267984666 COD Account
3276601798 Dep
3267984674 COD Account
1171987399 Dep
3267984682 COD Account
1612148975 Dep
3267984708 COD Account
1612020101 Dep
1171987404 Dep
3267984724 COD Account
3267984732 COD Account
3267984740 COD Account
1229466699 Dep
3267984757 COD Account
3267984765 COD Account
3276601939 Dep
3267984773 COD Account
3276600022 Dep
3267984781 COD Account
3276599992 Dep
3267985713 COD Account
3267984799 COD Account
3276599968 Dep
3276601806 Dep
3267984815 COD Account
3267984823 COD Account
3267984831 COD Account
3267984849 COD Account
3267984856 COD Account
3267984864 COD Account
3267984872 COD Account
3276599984 Dep
3267984898 COD Account
3267984906 COD Account
3276601830 Dep
3267984914 COD Account
3276601848 Dep
3267984922 COD Account
PAGE 2 OF 5
SCHEDULE 3.17
ACCOUNTS
BANK INFORMATION
LOCATION LOW
NUMBER LEVERAGE STATE ACCOUNT/PROPERTY DESCRIPTION BANK CONTACT
- ------ -------- ----- ---------------------------- ---- -------
1775 y MD HOLIDAY INN Bank of America James Butler
1775 y MD Holiday Inn BWI Airport Bank of America James Butler
1776 y MD HOLIDAY INN FREDERICK Bank of America James Butler
1776 y MD Holiday Inn Bank of America James Butler
1780 y MD HOLIDAY INN CROMWELL BRIDGE Bank of America James Butler
1780 y MD Holiday Inn Cromwell Bridge (Balt.) Bank of America James Butler
1785 y MD HOLIDAY INN BELMONT Bank of America James Butler
1785 y MD Holiday Inn Belmont Bank of America James Butler
1810 IA HILTON INN SIOUX CITY Bank of America James Butler
1810 IA Hilton Inn Bank of America James Butler
1820 IA Clarion Hotel Bank of America James Butler
1830 IA SERVICO WEST DES MOINES, INC Bank of America James Butler
1830 IA Four Points Bank of America James Butler
1840 y IA Crowne Plaza Five Seasons Bank of America James Butler
1910 y MN Holiday Inn North (Arden Hills) Bank of America James Butler
2007 y KY Courtyard Bank of America James Butler
2020 KY Holiday Inn Bank of America James Butler
2035 y KY Courtyard Bank of America James Butler
2040 y KY Radisson Hotel East Bank of America James Butler
2050 KY Holiday Inn Bank of America James Butler
2100 y KS Holiday Inn Bank of America James Butler
2110 y KS LAWRENCE HOSPITALITY ASSOCIATES LP DBA Bank of America James Butler
2110 y KS Holiday Inn Bank of America James Butler
2120 KS SERVICO WICHITA INC DBA HOLIDAY INN Bank of America James Butler
2120 KS Holiday Inn Airport Bank of America James Butler
2222 y MO HOLIDAY INN ST LOUIS NORTH Bank of America James Butler
2222 y MO Holiday Inn St Louis Airport North Bank of America James Butler
2510 NE Clarion Hotel Omaha Bank of America James Butler
2520 NE Four Points Sheraton Bank of America James Butler
2700 y MA Crowne Plaza Bank of America James Butler
2727 y MA Courtyard (Bos.) Bank of America James Butler
2777 y MA Residence Inn (Bos.) Bank of America James Butler
3210 y NM Holiday Inn Bank of America James Butler
3311 y NY Crowne Plaza Bank of America James Butler
3314 y NY Holiday Inn Select Bank of America James Butler
3326 y NY Four Points Bank of America James Butler
3330 y NY Holiday Inn Bank of America James Butler
3345 y NY Holiday Inn Grand Island (Niag.) Bank of America James Butler
3348 NY Holiday Inn Farrell Road Bank of America James Butler
3398 NY Holiday Inn Bank of America James Butler
3422 NC RALEIGH DOWNTOWN ENTERPRISES INC C/O SERVICO INC Bank of America James Butler
3422 NC Holiday Inn Dntn Bank of America James Butler
3500 OH HOLIDAY INN CITY CENTER Bank of America James Butler
3510 OH Holiday Inn Bank of America James Butler
3515 y OH Holiday Inn Select Bank of America James Butler
3535 OH Holiday Inn Dntn Bank of America James Butler
3636 OK Courtyard Bank of America James Butler
3801 y PA Holiday Inn Monroeville (Pitt.) Bank of America James Butler
3802 y PA Holiday Inn Greentree Bank of America James Butler
3804 y PA Holiday Inn Parkway East Bank of America James Butler
3805 y PA Crowne Plaza (Pitt.) Bank of America James Butler
3806 y PA Holiday Inn North Hills (McKnight) Bank of America James Butler
3810 y PA Holiday Inn Meadow Lands Bank of America James Butler
3838 y PA Doubletree Club Hotel Bank of America James Butler
3875 y PA Holiday Inn - Arsenal Rd Bank of America James Butler
3890 y PA Holiday Inn East Bank of America James Butler
3930 y MI Hilton Inn Northfield Bank of America James Butler
3970 y MI Holiday Inn West Bank of America James Butler
PHONE # ADDRESS 1 ADDRESS 2 CITY STATE POSTAL CODE
------- --------- --------- ---- ----- -----------
800 547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800 547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800 547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800 547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800 547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800 547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800 547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800 547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800 547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800-547-6058 Treasury Management Service 101 South Tryon Street Charlotte NC 28255
800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800-547-6058 Treasury Management Service 101 South Tryon Street Charlotte NC 28255
800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
ACCOUNT # ACCOUNT TYPE
--------- ------------
3276599950 Dep
3267984930 COD Account
3067294005 Dep
3267984948 COD Account
3064966394 Dep
3267984955 COD Account
3064966404 Dep
3267984963 COD Account
3276601905 Dep
3267984971 COD Account
3267984989 COD Account
3276600048 Dep
3267984997 COD Account
3267985002 COD Account
3267985010 COD Account
3267985036 COD Account
3267985051 COD Account
3267985069 COD Account
3267985077 COD Account
3267985085 COD Account
3267985101 COD Account
3276601814 Dep
3267985119 COD Account
3276601822 Dep
3267985127 COD Account
3276601913 Dep
3267985135 COD Account
3267985150 COD Account
3267985168 COD Account
3267985176 COD Account
3263038889 COD Account
3267985184 COD Account
3267985200 COD Account
3267985226 COD Account
3267985234 COD Account
3267985242 COD Account
3267985259 COD Account
3267985275 COD Account
3267985267 COD Account
3267985283 COD Account
3276600014 Dep
3267985309 COD Account
1611996993 Partnership Acct
3267985317 COD Account
3267985325 COD Account
3267985333 COD Account
3267985341 COD Account
3267985390 COD Account
3267985408 COD Account
3267985416 COD Account
3267985424 COD Account
3267985432 COD Account
3267985457 COD Account
3267985465 COD Account
3267985473 COD Account
3267985499 COD Account
3267985507 COD Account
3267985515 COD Account
PAGE 3 OF 5
SCHEDULE 3.17
ACCOUNTS
BANK INFORMATION
LOCATION LOW
NUMBER LEVERAGE STATE ACCOUNT/PROPERTY DESCRIPTION BANK
- ------ -------- ----- ---------------------------- -----
4010 y SC HILTON HEAD ENTERPRISES Bank of America
4010 y SC Holiday Inn Bank of America
4021 y SC BW NORTHWOODS ATRIUM CHARLESTON Bank of America
4021 y SC Clarion Hotel Charleston Bank of America
4040 y SC HOLIDAY INN MYRTLE BEACH Bank of America
4040 y SC Holiday Inn Sunspree Resort - MYR Bank of America
4205 TN Fairfield Inn Jackson Bank of America
4215 y TN FRENCH QUARTER MEMPHIS Bank of America
4215 y TN French Quarter Suites Bank of America
4242 TN Holiday Inn Sycamore View Bank of America
4310 y TX RAMADA PLAZA HOUSTON Bank of America
4310 y TX RAMADA PLAZA HOUSTON Bank of America
4310 y TX Crowne/Ramada Plaza Bank of America
4343 y TX COURTYARD ABILENE Bank of America
4343 y TX LODGIAN ABILENCE BEVERAGE CORP Bank of America
4343 y TX Courtyard Bank of America
4375 y TX SERVICO AUSTIN INC Bank of America
4375 y TX SERVICO AUSTIN INC Bank of America
4375 y TX Holiday Inn South Bank of America
4380 y TX HOLIDAY INN MARKET CENTER Bank of America
4380 y TX HOLIDAY INN MARKET CENTER Bank of America
4380 y TX Holiday Inn Market Center Bank of America
4388 y TX HOLIDAY INN DFW Bank of America
4388 y TX HOLIDAY INN DFW/BEVERAGE DALLAS Bank of America
4388 y TX Holiday Inn Select DFW Airport (Dal.) Bank of America
4545 VT IMPAC III DBA FAIRFIELD BURLINGTON Bank of America
4800 WV Holiday Inn Bank of America
4848 WV Holiday Inn Bank of America
4899 WV Holiday Inn Clarksburg Bank of America
6003 Western Regional Office Bank of America
Impac I GA Fairfield Bank of America
GA LODGIAN, INC. PAYROLL ACCT Bank of America
GA LODGIAN DISBURSEMENT ACCOUNT Bank of America
GA IMPAC II Bank of America
GA IMPAC III Bank of America
GA LODGIAN FINANCING CORP Bank of America
GA LODGIAN INC Bank of America
GA LODGIAN INC Bank of America
GA LODGIAN INC Bank of America
GA Courtyard by Marriott Bank of America
GA Lodgian, Inc. Bank of America
3890 y PA AMI OPERATING PARTNERS - A LTD PTRSHP Bank of Lancaster
707 CO MARRIOTT DENVER AIRPORT/CAPITAL CORP OF AMERICA Bank One
707 CO MARRIOTT DENVER AIRPORT/CAPITAL CORP OF AMERICA/Security Dep Bank One
1265 GA THE CAPITAL CO OF AMERICA Bank One
1310 y IL HOLIDAY INN ROLLING MEADOWS Bank One
1421 IN RAMADA INN BLOOMINGTON Bank One
1515 LA COURTYARD LAFAYETTE Bank One
1515 LA THE CAPITAL CO OF AMERICA LLC AS MORTGAGEE OF IMPAC HOTELS Bank One
2040 y KY DOUBLETREE LOUISVILLE Bank One
2050 KY HOLIDAY INN, FLORENCE Bank One
2050 KY HOLIDAY INN, FLORENCE Bank One
2828 NH HOLIDAY INN MERRIMACK Bank One
3500 OH HOLIDAY INN CITY CENTER Bank One
3510 OH BRECKSVILLE HOSPITALITY LTD PART Bank One
3636 OK CAPITAL CORP OF AMERICA/COURTYARD TULSA Bank One
3636 OK CAPITAL CORP OF AMERICA/COURTYARD TULSA Bank One
4545 VT FAIRFIELD INN BURLINGTON Bank One
CONTACT PHONE # ADDRESS 1 ADDRESS 2 CITY STATE POSTAL CODE
- ------- ------- --------- --------- ---- ----- -----------
James Butler 800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
James Butler 800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
Customer Service 800-547-6058 Treasury Management Service 101 South Tryon Street Charlotte NC 28255
James Butler 800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
Customer Service 800-547-6058 Treasury Management Service 101 South Tryon Street Charlotte NC 28255
James Butler 800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
James Butler 800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
James Butler 800-547-6058 Treasury Management Service 101 South Tryon Street Charlotte NC 28255
James Butler 800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
James Butler 800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
James Butler 800 547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
James Butler 800 547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
James Butler 800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
James Butler 800 547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
James Butler 800 547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
James Butler 800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
James Butler 800 547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
James Butler 800 547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
James Butler 800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
James Butler 800 547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
James Butler 800 547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
James Butler 800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
James Butler 800 547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
James Butler 800 547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
James Butler 800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
James Butler 800 547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
James Butler 800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
James Butler 800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
James Butler 800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
James Butler 800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
James Butler 800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
James Butler 800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
James Butler 800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
James Butler 800 547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
James Butler 800 547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
James Butler 800 547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
James Butler 800 547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
James Butler 800 547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
James Butler 800 547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
James Butler 800-547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
James Buttler 800 547-6058 Real Estate Treasury Services 101 South Tryon Street Charlotte NC 28255
Customer Service 717-560-5800 1097 Commercial Ave P.O. Box 38 East Petersburg PA 17520
Debbie Young 337-265-3219 Mail Code LA-2-7685 P.O. Box 3248 Layfayette LA 70502
Debbie Young 337-265-3219 Mail Code LA-2-7685 P.O. Box 3248 Layfayette LA 70502
Debbie Young 337-265-3219 Mail Code LA-2-7685 P.O. Box 3248 Layfayette LA 70502
Customer Service 800-404-4111 1 Bank One Plaza Chicago IL 60670
Customer Service 800-404-4111 Bank One Indiana, N.A. 7610 W. Washington Street Indianapolis IN 46231
Debbie Young 337-265-3219 Mail Code LA-2-7685 P.O. Box 3248 Layfayette LA 70502
Debbie Young 337-265-3219 Mail Code LA-2-7685 P.O. Box 3248 Layfayette LA 70502
Debbie Young 337-265-3219 Mail Code LA-2-7685 P.O. Box 3248 Layfayette LA 70502
Debbie Young 337-265-3219 Mail Code LA-2-7685 P.O. Box 3248 Layfayette LA 70502
Debbie Young 337-265-3219 Mail Code LA-2-7685 P.O. Box 3248 Layfayette LA 70502
Debbie Young 337-265-3219 Mail Code LA-2-7685 P.O. Box 3248 Layfayette LA 70502
800-404-4111 Department 1045 Columbus OH 43271
800-404-4111 Department 1045 Columbus OH 43271
Debbie Young 337-265-3219 Mail Code LA-2-7685 P.O. Box 3248 Layfayette LA 70502
Debbie Young 337-265-3219 Mail Code LA-2-7685 P.O. Box 3248 Layfayette LA 70502
Debbie Young 337-265-3219 Mail Code LA-2-7685 P.O. Box 3248 Layfayette LA 70502
ACCOUNT # ACCOUNT TYPE
- --------- ------------
745010325 Dep
3267985523 COD Account
3276600006 Dep
3267985531 COD Account
3276599976 Dep
3267985556 COD Account
3267985580 COD Account
3276600030 Dep
3267985606 COD Account
3267985614 COD Account
5772042273 Dep
5772042232 Liquor
3267985598 COD Account
3276600055 Dep
1390070419 Liquor
3267984880 COD Account
3276601871 Dep
1390070435 Liquor
3267985630 COD Account
3276601889 Dep
1390070422 Liquor
3267985648 COD Account
3276601863 Dep
1390072653 Liquor
3267985689 COD Account
3272206519 Magers
3267985440 COD Account
3267985622 COD Account
3267985382 COD Account
3267985671 COD Account
3272293483 COD Account
3272208911 Payroll
3272208903 Accounts Payable
3272209570 Dep Acct trsf from LaSalle
3272209588 Dep Acct trsf from LaSalle
3263038863 Concentration, Master Funding
3267984443 Manager's Checks Master Funding Account
3263057186 Concentration, Master Funding
3263057202 Travel Agent
3276598945 COD Account
3263057202 Travel Agent Account
917144401 Dep
1192614780 Dep
192614863 Sec Dep
1588492973 Lockbox
616201570 Dep
181457950 Dep
1588493393 Sec Dep
7114107762 Bk Rem Clearing
88324561 Dep
618006514 Bk Rem Clearing
618006522 Sec Dep
L/B1588492973 Dep
980291258 Dep
100207554 Dep
628891822 Sec Dep
628891814 Bk Rem Clearing
13051115 Bk Rem Clearing
PAGE 4 OF 5
SCHEDULE 3.17
ACCOUNTS
BANK INFORMATION
LOCATION LOW
NUMBER LEVERAGE STATE ACCOUNT/PROPERTY DESCRIPTION BANK CONTACT
- ------ -------- ----- ---------------------------- ---- -------
LA THE CAPITAL CO OF AMERICA (Baton Rouge) Bank One Debbie Young
LA THE CAPITAL CO OF AMERICA Bank One Debbie Young
GA THE CAPITAL CO OF AMERICA Bank One Debbie Young
3311 y NY OMNI ALBANY CHARTER BANK Heather Shea
210 y AL SHEFFIELD MOTEL ENTERPRISES INC DBA HOLIDAY INN SHEFFIELD Colonial Bank Customer Service
210 y AL SHEFFIELD MOTEL ENTERPRISES INC DBA HOLIDAY INN SHEFFIELD Colonial Bank Customer Service
3930 y MI NH ENTERPRISES INC/HILTON NORTHFIELD Comerica
2100 y KS HOLIDAY INN MANHATTAN Commerce Bank
2100 y KS MANHATTAN HOSPITALITY ASSOCIATES Commerce Bank
2727 y MA COMFORT INN BOSTON Eastern Bank
1207 y GA HOLIDAY INN JEKYLL ISLAND First Bank of Brunswick
1160 y FL Holiday Inn (Melbourne) First Union Customer Service
1720 y MD HOLIDAY INN WASHINGTON DC First Union Customer Service
3500 OH Holiday Inn City Center First Union Customer Service
3838 y PA PHILADELPHIA LODGING First Union Customer Service
3875 y St HOLIDAY INN ARSENAL ROAD First Union
2035 y KY IMPAC HOTELS I LLC FIRSTAR
3515 y OH IMPAC HOTELS II LLC FIRSTAR
2777 y MA RESIDENCE INN DEDHAM Fleet Bank
1502 y LA SERVICO METAIRIE DBA QUALITY HOTEL Hibernia National Bank
3314 y NY SERVICO NEW YORK INC HSBC Customer Service
3326 y NY HOLIDAY INN NIAGARA FALLS HSBC Customer Service
3345 y NY SERVICO GRAND ISLAND HSBC Customer Service
4800 WV HOLIDAY INN FAIRMONT Huntington Stephen Petitto
4800 WV HOLIDAY INN FAIRMONT Huntington Stephen Petitto
4848 WV HOLIDAY INN MORGANTOWN Huntington Stephen Petitto
4848 WV HOLIDAY INN MORGANTOWN Huntington Stephen Petitto
4899 WV HOLIDAY INN BRIDGEPORT Huntington Stephen Petitto
4899 WV HOLIDAY INN BRIDGEPORT Huntington Stephen Petitto
3330 y NY HOLIDAY INN JAMESTOWN Key Bank Customer Service
GA LENNOX BUILDING/IMPAC HOTEL LaSalle Ruth Hall
GA LENNOX BUILDING/IMPAC HOTEL LaSalle Ruth Hall
3348 NY THE CAP CORP OF AMERICA/IMPAC HOTELS M&T Bank Customer Service
3348 NY THE CAPITAL CORP OF AMERICA AS MORTGAGEE IMPAC HOTELS II M&T Bank Customer Service
3398 NY HOLIDAY INN HAMBURG M&T Bank Customer Service
3398 NY HOLIDAY INN HAMBURG M&T Bank Customer Service
3804 y PA APICO HILLS/HOLIDAY INN PARKWAY EAST Mellon Bank
3805 y PA CLARION ROYCE PITTSBURGH/MOON ROYCE Mellon Bank
3806 y PA HOLIDAY INN MCKNIGHT ROAD Mellon Bank
3970 y MI HOLIDAY INN WEST LANSING Michigan National
1425 y IN FORT WAYNE HILTON National City Customer Service
1440 y IN HOLIDAY INN FORT WAYNE National City Customer Service
3810 y PA WASHINGTON MOTEL ASSOCIATES LTD National City Customer Service
2020 KY IMPAC HOTELS ii CAP CO OF AMER LLC PNC Bank
2020 KY IMPAC HOTELS II DBA HOLIDAY INN FT MITCHELL PNC Bank
3801 y PA APICO INNS OF PITTSBURG INC DBA HOLIDAY INN PNC Bank
3802 y PA APICO INNS GREENTREE INC PNC Bank
3535 OH HOLIDAY INN CINCINNATI Provident Bank
3535 OH HOLIDAY INN CINCINNATI Provident Bank
5950 y Ont, CA SERVICO WINDSOR Royal Bank of Canada Jo-Ann Smith
5950 y Ont, CA SERVICO WINDSOR Royal Bank of Canada Jo-Ann Smith
5950 y Ont, CA SERVICO WINDSOR Royal Bank of Canada Jo-Ann Smith
5950 y Ont, CA Holiday Inn Select Royal Bank of Canada Jo-Ann Smith
5950 y Ont, CA Holiday Inn Select Royal Bank of Canada Jo-Ann Smith
220 y AL DOTHAN HOSPITALITY 3053 SouthTrust
220 y AL DOTHAN HOSPITALITY 3053 SouthTrust
230 y AL DOTHAN HOSPITALITY 3053 SouthTrust
240 y AL GADSEN HOSPITALITY INC. SouthTrust
PHONE # ADDRESS 1 ADDRESS 2 CITY STATE POSTAL CODE
------- ------- --------- --------- ------ ------------
337-265-3219 Mail Code LA-2-7685 P.O. Box 3248 Layfayette LA 70502
337-265-3219 Mail Code LA-2-7685 P.O. Box 3248 Layfayette LA 70502
337-265-3219 Mail Code LA-2-7685 P.O. Box 3248 Layfayette LA 70502
518-426-6473 101 N. Pearl Street Albany NY 12207
877-502-2265 P.O. Box 1887 Birmingham AL 35201
877-502-2265 P.O. Box 1887 Birmingham AL 35201
248-371-5288 P.O.Box 75000 Detroit MI 48275
785-537-1234 727 Poyntz Avenue Manhattan KS 66502
785-537-1234 727 Poyntz Avenue Manhattan KS 66502
781-599-2100 270 Union Street Lynn MA 01901
912-267-9500 5340 New Jesup Highway Burnswick GA 31520
800-222-3862 10 Corporate Centre 10400 Little Patuxent Pkwy Columbia MD 21044
800-222-3862 10400 Little Patuxent Pkwy Columbia MD 21044
800-222-3862 10400 Little Patuxent Pkwy Columbia MD 21044
800-222-3862 10400 Little Patuxent Pkwy Columbia MD 21044
800-225-5332 1500 N. George Street York PA 17404
800-481-4544 5001 Houston Road Florence KY 41042
800-481-4544 14444 Pearl Road Strongsville OH 44136
800-353-3824 858 Washington Street Dedham MA 2026
800-262-5689 2200 N Causeway Metarie LA 70001
800-975-4722 8301 Niagara Falls Blvd Niagara Falls NY 14304
800-975-4722 8301 Niagara Falls Blvd Niagara Falls NY 14304
800-975-4722 8301 Niagara Falls Blvd Niagara Falls NY 14304
304-623-7100 P.O. Box 2490 Clarksburg WV 26302
304-623-7100 P.O. Box 2490 Clarksburg WV 26302
304-623-7100 P.O. Box 2490 Clarksburg WV 26302
304-623-7100 P.O. Box 2490 Clarksburg WV 26302
304-623-7100 P.O. Box 2490 Clarksburg WV 26302
304-623-7100 P.O. Box 2490 Clarksburg WV 26302
800-539-2968 P.O. Box 22114 Albany NY 22114
312-904-7232 Suite 1840 135 S. Lasalle Street Chicago IL 60603
312-904-7232 Suite 1840 135 S. Lasalle Street Chicago IL 60603
315-622-3227 101 South Salina Street Syracuse NY 13202
315-622-3227 101 South Salina Street Syracuse NY 13202
845-354-6009 P.O. Box 10090 Newburgh NY 12552
716-649-8400 One Fountain Plaza Buffalo NY 14203
800-527-1800 2005 Rt 286 Pittsburgh PA 15239
800-527-1800 Moontown Ship Office 1132 Thorn Run Rd, Ext Caraopolis PA 15101
800-527-1800 100 Ross Park Mall Drive Pittsburgh PA 15237
27777 Inksetter Road Farmington Hills MI 48333
800-774-2424 One National Center Indianapolis IN 46255
800-774-2424 One National Center Indianapolis IN 46255
800-352-0186 116 Alleghency Center Mall Pittsburgh PA 15212
877-287-2654 P.O. Box 609 Pittsburgh PA 15230
877-287-2654 P.O. Box 609 Pittsburgh PA 15230
877-287-2654 P.O. Box 609 Pittsburgh PA 15230
877-287-2654 P.O. Box 609 Pittsburgh PA 15230
800-335-2220 Mail Stop 464F One East Fourth Street Cincinnati OH 45269
800-335-2220 Mail Stop 464F One East Fourth Street Cincinnati OH 45269
519-255-8657 Business Banking Center 245 Ouellete Avenue 2nd fl Windsor ONT N9A-7J2
519-255-8657 Business Banking Center 245 Ouellete Avenue 2nd fl Windsor ONT N9A-7J2
519-255-8657 Business Banking Center 245 Ouellete Avenue 2nd fl Windsor ONT N9A-7J2
519-255-8657 Business Banking Center 245 Ouellete Avenue 2nd fl Windsor ONT N9A-7J2
519-255-8657 Business Banking Center 245 Ouellete Avenue 2nd fl Windsor ONT N9A-7J2
334-793-0700 P.O. Box 809 Dothan Alabama AL 36302
334-793-0700 P.O. Box 809 Dothan Alabama AL 36302
334-793-0700 P.O. Box 809 Dothan Alabama AL 36302
334-793-0700 P.O. Box 809 Dothan Alabama AL 36302
ACCOUNT # ACCOUNT TYPE
- --------- ------------
1588493021 Credit Card Clearing
1588492965 Lockbox
1588493039 Checking
4420050034 Dep
5152666 Dep
8007324224 Liquor
2401005612 Dep
620662607 Liquor
620662666 Dep
600082408 Dep
6016406 Dep
2090001113784 COD Account
203000812842 Dep
2090001974224 COD Account
2030152160332 Dep
2000063968446 Dep
490329430 Dep
570254060 Dep
89857450 Dep
812393006 Dep
834159961 Dep
834159988 Dep
834159970 Dep
1531104982 Sec Dep
1531012281 Bk Rem Clearing
1521107766 Sec Dep
1521007442 Bk Rem Clearing
1521107753 Sec Dep
1521009110 Bk Rem Clearing
327700021055 Dep
677742009 Trust and Asset Account
677834905 Trust and Asset Account
8890222139 Sec Dep
8700238002 Bk Rem Clearing
8890177689 Sec Dep
16373565 Bk Rem Clearing
1719287 Dep
1707251 Dep
262676 Dep
1939586002 Dep
130005548 Dep
330007579 Dep
5151000285 Dep
4802849119 Sec Dep
4800156714 Bk Rem Clearing
1022746 Dep
2011432 Dep
859100 Dep
6004284 Sec Dep
1015890 AP Disbursements $C
4002325 Dep $US
1015932 General $C
1015940 COD Account
4002259 COD Account
67877298 Liquor
67877287 Depository
67877265 Dep
67877309 Dep
Page 5 of 5 BANK INFORMATION SCHEDULE 3.17
ACCOUNTS
LOCATION LOW
NUMBER LEVERAGE STATE ACCOUNT/PROPERTY DESCRIPTION BANK
- ------ -------- ----- ---------------------------- ----
2700 y MA WORCHESTER HOSPITALITY ASSC Sovereign Bank of New England
2727 y MA DBA BOSTON REVERE SunTrust
FL SERVICO MANAGEMENT CORP SunTrust
GA IMPAC HOTELS II LLC SunTrust
GA IMPAC HOTELS LLC SunTrust
1178 FL THE CAPITAL CO OF AMERICA AS MORTGAGE OF IMPAC HOTELS II LLC Union Planters
1178 FL THE CAPITAL CO OF AMERICA AS MORTGAGE OF IMPAC HOTELS II LLC Union Planters
1183 FL THE CAPITAL CO OF AMERICA AS MORTGAGE OF IMPAC HOTELS II LLC Union Planters
1183 FL THE CAPITAL CO OF AMERICA AS MORTGAGE OF IMPAC HOTELS II LLC Union Planters
2007 y KY COURTYARD PADUCAH (MORT IMPAC HOTELS I LLC) Union Planters
4205 TN IMPACS HOTELS III LLC DBA FAIRFIELD INN SECURITY Union Planters
4205 TN IMPACS HOTELS III LLC DBA FAIRFIELD Union Planters
4242 TN THE CAPITAL COMPANY OF AMERICA LLC Union Planters
4242 TN THE CAP CO OF AMER AS MORT OF IMPAC Union Planters
850 y CT HOLIDAY INN EAST HARTFORD Webster Bank
725 y CO SERVICO FRISCO INC Wells Fargo
1840 y IA SERVICO CEDAR RAPIDS Wells Fargo
1910 y MN HOLIDAY INN ARDEN HILLS/ST PAUL Wells Fargo
2510 NE CLARION HOTEL OMAHA Wells Fargo
2520 NE SHERATON OMAHA Wells Fargo
1820 IA BEST WESTERN COUNCIL BLUFFS Wells Fargo Nebraska N.A.
CONTACT PHONE # ADDRESS 1 ADDRESS 2 CITY STATE POSTAL CODE
------- ------- --------- --------- ------- ----- -----------
Customer Service 800-727-8637 75 State Street Boston MA 02110
Deborah A. Metts 404-575-2687 Treasury Management Service P.O. Box 4418 Atlanta GA 30302
N/A 800-786-8787 P.O. Box 405100/Mail Code 1062 Ft.Lauderdale Florida FL 33340
Deborah A. Metts 404-575-2687 Treasury Management P.O. Box 4418 Atlanta GA 30302
Deborah A. Metts 404-575-2687 Treasury Management P.O. Box 4418 Atlanta GA 30302
Adianez Rodriguez 877-848-2265 3516 Main Highway Coconut Grove FL 33133
Adianez Rodriguez 877-848-2265 3516 Main Highway Coconut Grove FL 33133
Adianez Rodriguez 877-848-2265 3516 Main Highway Coconut Grove FL 33133
Adianez Rodriguez 877-848-2265 3516 Main Highway Coconut Grove FL 33133
800-333-1882 US Hwy 60 West Paducah KY 42002
800-921-0086 Treasury Management 118 North Liberty Jackson TN 38301
800-921-0086 Treasury Management 118 North Liberty Jackson TN 38301
800-921-0086 118 North Liberty Jackson TN 38301
800-921-0086 118 North Liberty Jackson TN 38301
800-482-2220 P.O. Box 191 Waterbury CT 06720
503-721-5330 Domestic Coll/ MAC P6103-084 P.O. Box 3055 Portland OR 97208
Kevin Stillman 515-237-5840 P.O. Box 837 Des Moines IA 50304
503-721-5330 Domestic Coll/ MAC P6103-084 P.O. Box 3055 Portland OR 97208
503-721-5330 Domestic Coll/ MAC P6103-084 P.O. Box 3055 Portland OR 97208
503-721-5330 Domestic Coll/ MAC P6103-084 P.O. Box 3055 Portland OR 97208
402-536-2553 P.O. Box 3408 Omaha NE 68103
ACCOUNT # ACCOUNT TYPE
--------- ------------
39700038324 DEP/CHECKING
8800245105 Checking
417006207997 LIFERE
8801724835 Corp Acct
8801824650 Receivables
9660010548 Sec Dep
9660010530 Bk Rem Clearing
9660022543 Sec Dep
9660022550 Bk Rem Clearing
10006861 Dep
1210119628 Bk Rem Clearing
3500302775 Sec Dep
3500324588 Bk Rem Clearing
3500324531 Sec Dep
3311913012 Dep
3068001137 Checking
3000439578 Dep
3522097408 Dep
1155081292 Dep
1155081305 Dep
1155081401 Dep
CONFORMED COPY
SECURITY AND PLEDGE AGREEMENT
SECURITY AND PLEDGE AGREEMENT (this "AGREEMENT"), dated as of December
31, 2001, by and among Lodgian, Inc., a Delaware corporation (the "BORROWER"),
and each of the direct and indirect subsidiaries of the Borrower that is party
hereto (collectively, with the Borrower, the "GRANTORS"), certain of which
Grantors is a debtor and debtor-in-possession in a case pending under chapter 11
of the Bankruptcy Code, and Morgan Stanley Senior Funding, Inc., as Collateral
Agent (in such capacity, the "COLLATERAL AGENT") for the Secured Parties (as
hereinafter defined):
WHEREAS, contemporaneously with the execution and delivery of this
Agreement, the Grantors and other subsidiaries of the Borrower, certain
financial institutions (the "DIP LENDERS") and Morgan Stanley Senior Funding,
Inc., as Administrative Agent (in such capacity, the "ADMINISTRATIVE AGENT",
and, together with the Collateral Agent, the "AGENTS"), are entering into a
Revolving Credit and Guaranty Agreement dated as of the date hereof (as amended,
modified or supplemented from time to time, the "DIP CREDIT AGREEMENT"); and
WHEREAS, unless otherwise defined herein, terms defined in the DIP
Credit Agreement are used herein as therein defined; and
WHEREAS, it is a condition precedent to the making of Loans and the
issuance of Letters of Credit that the Grantors shall have granted, subject to
the Carve-Out, a security interest, pledge and lien on (x) all cash and cash
equivalents maintained in each Letter of Credit Account and (y) all of the
Grantors' assets and properties and the proceeds thereof pursuant to applicable
provisions of the Bankruptcy Code to the extent any Grantor is the subject of a
Case; and
WHEREAS, in the case of each Grantor that is the subject of a Case,
the grant of such security interest, pledge and lien has been authorized
pursuant to applicable provisions of the Bankruptcy Code by the Interim Order,
and, after the entry thereof, will have been so authorized by the Final Order
(collectively, the "ORDERS"); and
WHEREAS, to supplement the Orders, without in any way diminishing or
limiting the effect of the Orders or the security interest, pledge and lien
granted thereunder, the parties hereto desire to more fully set forth their
respective rights in connection with such security interest, pledge and lien;
and
WHEREAS, the Orders authorize the Grantors that are a subject of a
Case to execute, deliver and perform this Agreement;
NOW, THEREFORE, in consideration of the premises contained herein and
in order to induce the DIP Lenders to make Loans and issue Letters of Credit,
and to induce the Agents to act in such capacities, the Grantors hereby agree
with the Collateral Agent as follows:
SECTION 1. Grant of Security and Pledge. In order to secure the full
and punctual payment of the Obligations, each of the Grantors hereby transfers,
grants, bargains, sells, conveys, hypothecates, assigns, pledges and sets over
to the Collateral Agent for its benefit and the ratable benefit of the DIP
Lenders and the Agents (the DIP Lenders and the Agents, collectively, the
"SECURED PARTIES") a continuing and perfected pledge and security interest in
all of the Grantors' right, title and interest in and to the following (whether
now owned or existing or hereafter acquired or arising and regardless of where
located, the "COLLATERAL") which pledge and security interest shall have the
priorities and be subject and subordinated to the Carve-Out as provided in the
Orders and in the DIP Credit Agreement:
(a) all "accounts" (as defined in the UCC) now owned or hereafter
acquired by any of the Grantors, including but not limited to, all accounts
receivable, contract rights, book debts, notes, drafts and other obligations or
indebtedness owing to the Grantors arising from the sale, lease or exchange of
goods or other property by them and/or the performance of services by them
(including, without limitation, any such obligation that might be characterized
as an account, contract right or general intangible under the Uniform Commercial
Code in effect in any jurisdiction except those evidenced by instruments or
chattel paper) and all of the Grantors' rights in, to and under all purchase
orders for goods, services or other property, and all of the Grantors' rights to
any goods, services or other property represented by any of the foregoing
(including returned or repossessed goods and unpaid sellers' rights of
rescission, replevin, reclamation and rights to stoppage in transit) and all
monies due to or to become due to the Grantors under all contracts for the sale,
lease or exchange of goods or other property and/or the performance of services
by them (whether or not yet earned by performance on the part of the Grantors),
in each case whether now in existence or hereafter arising or acquired and
wherever arising including, without limitation, the right to receive the
proceeds of said purchase orders and contracts, and all collateral security and
guarantees of any kind given by any Person with respect to any of the foregoing
(collectively, the "ACCOUNTS");
(b) all "inventory" (as defined in the UCC) including, but not
limited to, goods and merchandise, whether now owned or hereafter acquired by
each of the Grantors and wherever located, whether in the possession of a
Grantor or of a bailee or other person for sale, storage, transit, processing,
use or otherwise consisting of whole goods, components, supplies, materials, or
consigned, returned or repossessed goods, that are held for sale or lease or to
be furnished (or have been furnished) under any contract of service or that are
raw materials,
2
work-in-process, finished goods or materials and any products made or processed
therefrom and all substances, if any, commingled therewith or added thereto,
used or consumed in any Grantors' business or processed by or on behalf of any
Grantor (collectively, the "INVENTORY");
(c) all "equipment" (as defined in the UCC) including, without
limitation, (i) all machinery, all manufacturing, distribution, selling, data
processing and office equipment, all furniture, furnishings, appliances,
fixtures and trade fixtures, tools, tooling, molds, dies, motor vehicles,
vessels, aircraft, trailers, (ii) all railcars, barges and other water carrier
equipment, and all accessions, appurtenances and parts installed on and
additions thereto, and replacements thereof, now owned or hereafter acquired by
the Grantors (the items in this clause (ii) collectively, "ROLLING STOCK") and
(iii) all other goods of every type and description (other than Inventory), in
each instance whether now owned or hereafter acquired by each of the Grantors
and wherever located (items (i) through (iii) collectively, the "EQUIPMENT");
(d) all rights of each Grantor under the Portland General Sale
Contract, including, without limitation, the right to receive any purchase price
payments, indemnity payments or other payments thereunder (it being understood
that any rights constituting control of a utility or its facilities shall not be
exercised unless all governmental and regulatory approvals have been obtained);
(e) all "general intangibles" (as defined by the UCC), whether now
owned or hereafter acquired, including, without limitation, all rights,
interests, choses in action, causes of action, claims and all other intangible
property of each of the Grantors of every kind and nature (other than Accounts,
Trademarks (as defined herein), written agreements now or hereafter in existence
granting to the Grantors any right to use any Trademark (the "TRADEMARK
LICENSES"), Patents (as defined herein), written agreements now or hereafter in
existence granting to the Grantors any right to practice any invention on which
a Patent is in existence (the "PATENT LICENSES"), Copyrights (as defined
herein), and any written agreements now or hereafter in existence granting to
the Grantors any right to publication as to which a Copyright is in existence
(the "COPYRIGHT LICENSES")); all general intangibles; all corporate and other
business records; all loans, royalties, and other obligations receivable; all
inventions, designs, trade secrets, computer programs, software, printouts and
other computer materials, goodwill, registrations, licenses, ledger cards,
franchises, customer lists, credit files, books, correspondence, and advertising
materials; all customer and supplier contracts, firm sale orders, rights under
license and franchise agreements (including all license agreements with any
other Person in connection with any of the Patents and Trademarks or such other
Person's names or marks, whether such Grantor is a licensor or licensee under
any such license agreement), and other contracts and contract rights; all
interests in partnerships and joint ventures; all tax refunds and tax refund
claims; all right, title and interest under leases, subleases, licenses and
3
concessions and other agreements to the extent assignable relating to real or
personal property; all payments due or made to each of the Grantors in
connection with any requisition, confiscation, condemnation, seizure or
forfeiture of any property by any person or governmental authority; all credits
with and other claims against carriers and shippers; all rights to
indemnification; all reversionary interests in pension and profit sharing plans
and revisionary, beneficial and residual interest in trusts maintained for
employees of any ERISA Affiliate; all proceeds of insurance of which any of the
Grantors is beneficiary; all letters of credit, guaranties, liens, security
interest and other security held by or granted to each of the Grantors; and all
other intangible property, whether or not similar to the foregoing
(collectively, the "GENERAL INTANGIBLES");
(f) all property or interests in property now or hereafter
acquired by each of the Grantors that may be owned or hereafter may come into
the possession, custody or control of the Collateral Agent or any agent or
affiliate of the Collateral Agent in any way or for any purpose (whether for
safekeeping, deposit, custody, pledge, transmission, collection or otherwise),
and all rights and interests of each of the Grantors, now existing or hereafter
arising and however and wherever arising, in respect of any and all (i) notes,
drafts, letters of credit, stocks, bonds, and debt and equity securities,
whether or not certificated, and warrants, options, puts and calls and other
rights to acquire or otherwise relating to the same; (ii) money (including all
cash and cash equivalents held in each Letter of Credit Account, Commitment
Account and, to the extent constituting property of a Grantor, any lockbox
account or the Concentration Account); (iii) proceeds of loans, including,
without limitation, Loans made under the DIP Credit Agreement; and (iv)
insurance proceeds and books and records (including, without limitation,
customer lists, credit files, computer programs, printouts and other computer
materials and records) relating to any of the property covered by this
Agreement; together, in each instance, with all accessions and additions
thereto, substitutions therefor, and replacements, proceeds and products
thereof;
(g) all trademarks, trade names, corporate names, company names,
business names, fictitious business names, trade styles, service marks, logos,
other source or business identifiers, prints and labels on which said
trademarks, trade names, trade styles and service marks have appeared or appear,
designs and general intangibles of like nature, now existing or hereafter
adopted or acquired, and all registrations and recordings thereof, including,
without limitation, applications, registrations and recordings in the United
States Patent and Trademark Office or in any similar office or agency of the
United States, any State thereof, or any other country or political subdivision
thereof, all whether now owned or hereafter acquired by each of the Grantors,
and all reissues, extensions or renewals thereof and all licenses thereof
(together, in each case, with the goodwill of the business connected with the
use of, and symbolized by each such trademark, service mark, trade name and
trade dress, all of the foregoing being herein referred to as the "
TRADEMARKS").
4
(h) all letters patent of the United States or any other country,
and all registrations and recordings thereof, including, without limitation,
applications, registrations and recordings in the United States Patent and
Trademark Office or in any similar office or agency of the United States, any
State thereof or any other country or any political subdivision thereof, all
whether now owned or hereafter acquired by each of the Grantors, and all
reissues, continuations, continuations-in- part or extensions thereof and all
licenses thereof (all of the foregoing being herein referred to as the
"PATENTS");
(i) all copyrights under the laws of the United States, or any
other country, and all registrations and recordings thereof, including, without
limitation, applications, registrations and recordings in the United States
Copyright Office or in any similar office or agency of the United States, any
State thereof, or any other country or political subdivision thereof, all
whether now owned or hereafter acquired by each of the Grantors, and all
reissues, continuations, continuations-in- part or extensions thereof and all
licenses thereof (all of the foregoing being herein referred to as the
"COPYRIGHTS");
(j) (i) all the shares of capital stock or other equity interests
owned by each Grantor in any entity, including, without limitation,
those shares listed on Schedule 1 hereto of the entities listed thereon
(individually, an "ISSUER," and collectively, the "ISSUERS") and all
issued and outstanding shares of capital stock or other equity
interests of any Issuer obtained in the future by any Grantor and the
certificates representing or evidencing all such shares or equity
interests (collectively, the "PLEDGED EQUITY INTERESTS"), (ii) all
other property that may be delivered to and held by the Collateral
Agent in respect of the Pledged Equity Interests pursuant to the terms
hereof; (iii) all dividends, cash, instruments and other property from
time to time received, receivable or otherwise distributed, in respect
of, in exchange for or upon the conversion of the securities referred
to in clauses (i) and (ii) above; and (iv) all rights and privileges of
each Grantor, as applicable, with respect to the securities and other
property referred to in clauses (i), (ii) and (iii);
(k) all notes and other instruments and all income and profits
therefrom, and all rights and privileges with respect thereto, and all interest
and other payments and distributions with respect thereto and all proceeds of
the foregoing (collectively, the "PLEDGED NOTES" as set forth on Schedule 2
hereto and, together with all of the items listed in Section 1(j) above, the
"PLEDGED SECURITIES");
(l) all "documents" (as defined in the UCC) or other receipts
covering, evidencing or representing goods, now owned or hereafter acquired by
the Grantors (collectively, the "DOCUMENTS");
5
(m) all "chattel paper" (as defined in the UCC, including, without
limitation, electronic chattel paper, as also defined in the UCC) or
"instruments" (as defined in the UCC) or "letters of credit" (as defined in the
UCC) and other property evidencing, representing, arising from or existing in
respect of, relating to, securing or otherwise supporting the payment of, any of
the Accounts, including (but not limited to) promissory notes, debt instruments,
drafts, bills of exchange, bills of lading, warehouse receipts, trade
acceptances and other documents of title, now owned or hereafter acquired by the
Grantors (collectively, the "INSTRUMENTS");
(n) the Concentration Account, all cash deposited therein from
time to time, the Liquid Investments (as defined below) made pursuant to Section
6(d) and other monies and property of any kind of the Grantors in the possession
or under the control of the Collateral Agent;
(o) all right, title, claims and benefits now owned or hereafter
acquired by the Grantors in and to any railcar leases, subleases, rental
agreements and car hire contracts in which the Grantors shall at any time have
any interest and any right, title, claim and benefits of the Grantors now owned
or hereafter acquired in and to any management agreements concerning all such
leases and agreements (collectively, the "ROLLING STOCK LEASES"); and all
right, title and interest of the Grantors in the railcars and equipment,
provided pursuant to any Rolling Stock Leases (the "LEASED ROLLING STOCK"); in
each case, including, without limitation, all rights of the Grantors to receive
any monies, revenues, payments or credits now owned or hereafter acquired by the
Grantors that are generated by or attributable to the Rolling Stock or Leased
Rolling Stock, including, without limitation, railcar hire payments, mileage
allowances, per diem mileage payments, empty mileage allowances, mileage credits
and excess mileage credits, in each case whether now existing or hereafter
arising (the "ROLLING STOCK REVENUES");
(p) all rights now owned or hereafter acquired by the Grantors to
receive and collect any Rolling Stock Revenues;
(q) all "deposit accounts" as such term is defined in the UCC;
(r) all "letter of credit rights", as such term is defined in the
UCC (the "LETTER OF CREDIT RIGHTS");
(s) all other personal property of each of the Grantors, whether
tangible or intangible, and whether now owned or hereafter acquired;
(t) all "INVESTMENT PROPERTY" which includes all (i) Securities,
whether certificated or uncertificated, (ii) Security Entitlements, (iii)
Securities Accounts,
6
(iv) Commodity Contracts and (v) Commodity Accounts now owned or hereafter
acquired by the Grantors; and
(u) all proceeds and products of any of the foregoing, in any
form, including, without limitation, any claims against third parties for loss
or damage to or destruction of any or all of the foregoing and, to the extent
not otherwise included, all (i) payments under insurance (whether or not the
Collateral Agent is the loss payee thereof), or any indemnity, warranty or
guaranty, payable by reason of loss or damage to or otherwise with respect to
any of the foregoing Collateral and (ii) cash.
For the purposes of subsection (t) of this Section, the following
definitions shall apply:
(i) "SECURITY" means an obligation of an issuer or a
share, participation, or other interests in an issuer or in property or
an enterprise of an issuer: (A) that is represented by a Security
certificate in bearer or registered form, or the transfer of which may
be registered upon books maintained for that purpose by or on behalf of
the issuer; (B) that is one of a class or series or by its term is
divisible into a class or series of shares, participations, interests,
or obligations; and (C) that: (1) is, or is of a type, dealt in or
traded on securities exchanges or securities markets; or (2) is a
medium for investment and by its terms expressly provides that it is a
security governed by Article 8 of the UCC.
(ii) "SECURITY ENTITLEMENT" means the rights and
property interest of an entitlement holder with respect to a Financial
Asset specified in Part 5 or Article 8 of the UCC.
(iii) "FINANCIAL ASSET" means: (A) a Security; (B) an
obligation of a person or a share, participation, or other interest in
a person or in property or an enterprise of a person, that is, or is of
a type, dealt in or traded on financial markets, or which is recognized
in any area in which it is issued or dealt in as a medium for
investment; or (C) any property that is held by a securities
intermediary for another person in a Securities Account if the
securities intermediary has expressly agreed with the other person that
the property is to be treated as a financial asset under Article 8 of
the UCC. As context requires, the term means either the interest itself
or the means by which a person's claim to it is evidenced, including a
certificated or uncertificated Security, a Security certificate, or a
Security Entitlement.
(iv) "SECURITIES ACCOUNT" means an account to which a
Financial Asset is or may be credited in accordance with an agreement
under which the person maintaining the account undertakes to treat the
person for
7
whom the account is maintained as entitled to exercise the rights that
comprise the Financial Asset.
(v) "COMMODITY CONTRACT" means a commodity futures
contract, an option on a commodity futures contract, a commodity
option, or other contract that, in each case, is: (A) traded on or
subject to the rules of a board of trade that has been designated as a
contract market for such a contract pursuant to the federal commodities
laws or (B) traded on a foreign commodity board of trade, exchange, or
market, and is carried on the books of a commodity intermediary for a
commodity customer.
(vi) "COMMODITY ACCOUNT" means an account maintained by
a commodity intermediary in which a Commodity Contract is carried for a
commodity customer, and all rights of any Grantor under any commodities
trading contract that does not constitute a "Commodity Contract"
including the right to receive any settlement or netting payment
thereunder.
Notwithstanding anything contained herein to the contrary, (a) the
total amount of shares of capital stock or other ownership interests of any
Person pledged pursuant to this Agreement that is not organized under the laws
of, or having a principal place of business in, the United States of America or
any State, the District of Columbia or any territory or possession of the United
States of America shall in no event exceed sixty-five percent (65%) of the total
outstanding shares of capital stock or such other ownership interests thereof
and (b) the security interests in the Collateral granted hereunder securing the
Obligations (the "SECURITY INTERESTS") are granted as security only and shall
not subject the Collateral Agent or any other Secured Party to, or transfer or
in any way affect or modify, any obligation or liability of the Grantors with
respect to any of the Collateral or any transaction in connection therewith.
SECTION 2. Security for Obligations. This Agreement and the
Collateral secure the payment of all Obligations of each of the Grantors.
SECTION 3. Delivery of Pledged Securities. Without further order of
the Bankruptcy Court, all Pledged Notes shall be delivered within 20 days after
the date of entry of the Interim Order of the Bankruptcy Court to the Collateral
Agent by the Grantors pursuant hereto indorsed in blank, and accompanied by any
required transfer tax stamps, all in form and substance satisfactory to the
Collateral Agent in its reasonable judgment. All certificates representing
Pledged Equity Interests shall be delivered within 20 days after the date of
entry of the Interim Order of the Bankruptcy Court to the Collateral Agent by
the Grantors pursuant hereto and shall be in suitable form for transfer by
delivery, or shall be accompanied by duly executed instruments of transfer or
assignment in blank, with signatures appropriately guaranteed, if required, and
accompanied by any
8
required transfer tax stamps, all in form and substance satisfactory to the
Collateral Agent in its reasonable judgment. Without further order of the
Bankruptcy Court, all Pledged Securities held by Morgan Stanley Senior Funding,
Inc. ("MSSF") under that Security Agreement dated as of July 23, 1999 (the
"PRE-PETITION PLEDGE AGREEMENT"), shall be and shall be deemed, for purposes of
the security interests granted under the Orders and hereunder, simultaneously to
be held by MSSF in the order of priority specified in the Orders, as Agent
hereunder and as agent under the Pre-Petition Pledge Agreement. Upon the
occurrence and during the continuance of any Event of Default, the Collateral
Agent shall have the right (for the ratable benefit of the Secured Parties), at
any time in its discretion and without notice to the Grantors, to transfer to or
to register in the name of the Collateral Agent or any of its nominees any or
all of the Pledged Securities.
SECTION 4. Representations and Warranties. Each Grantor, jointly and
severally, represents and warrants as follows:
(a) The exact name of each Grantor as it appears in its
certificate of incorporation (or other organizational documents) is set forth in
Schedule D-1 to Exhibit D hereto. Each Grantor is organized in the jurisdiction
set forth opposite the name of such Grantor in Schedule D-2 to Exhibit D hereto.
(b) The Grantors own and have good and marketable title to all of
the Collateral free and clear of any lien, security interest, charge or
encumbrance except for the security interest created by this Agreement and the
Liens permitted under the DIP Credit Agreement and under the Pre Petition Credit
Agreement. The Grantors have taken all actions necessary under the Uniform
Commercial Code, as in effect on the date hereof in the State of New York (the
"UCC"), for purposes of the provisions hereof relating to such perfection or
effect of perfection or non-perfection, to perfect their interest in any
Accounts purchased or otherwise acquired by them, as against their assignors and
creditors of their assignors, to the extent such perfection is governed by the
UCC, provided that if by reason of mandatory provisions of law, the perfection
or the effect of perfection or non-perfection of the Security Interests in any
Collateral governed by the Uniform Commercial Code as in effect in a
jurisdiction other than New York, "UCC" means the Uniform Commercial Code as
in effect in such other jurisdiction.
(c) The Grantors have not performed (nor will they perform) any
acts that might prevent the Collateral Agent from enforcing any of the terms and
conditions of this Agreement or that would limit the Collateral Agent in any
such enforcement. Other than the Orders, financing statements or other similar
or equivalent documents or instruments with respect to the Security Interests
and the Liens permitted by the DIP Credit Agreement, no financing statement,
mortgage, security agreement or similar or equivalent document or instrument
covering all
9
or any part of the Collateral is on file or of record in any jurisdiction in
which such filing or recording would be effective to perfect a Lien on such
Collateral. No Collateral is in the possession of any Person (other than the
Grantors) asserting any claim thereto or security interest therein, except that
the Collateral Agent or its designee may have possession of Collateral as
contemplated hereby and except for Collateral subject to the Liens permitted by
the DIP Credit Agreement.
(d) Not later than 20 days after the date of entry of the Interim
Order of the Bankruptcy Court, the Grantors shall deliver to the Collateral
Agent an executed certificate substantially in the form of Exhibit D, completed
and supplemented with the schedules and attachments contemplated thereby to the
reasonable satisfaction of the Collateral Agent (the "PERFECTION CERTIFICATE").
The information set forth therein shall be correct and complete in all
material respects. Not later than 20 days after the date of entry of the Interim
Order of the Bankruptcy Court, the Grantors shall furnish to the Collateral
Agent file search reports from each UCC filing office set forth in Schedules D-2
and D-3 to Exhibit D hereto, confirming the filing information set forth in such
Schedules.
(e) The Security Interests constitute valid security interests
securing the Obligations under applicable law and comply with Section 2.23 of
the DIP Credit Agreement.
(f) The Inventory and Equipment are insured in accordance with the
requirements of the DIP Credit Agreement.
(g) All Inventory has or will have been produced in substantial
compliance with the applicable requirements of the Fair Labor Standards Act, as
amended.
(h) The Grantors own all of the Pledged Securities, free and clear
of any Liens, security interests or encumbrances other than the Security
Interests and Liens permitted by the DIP Credit Agreement. The Pledged Equity
Interests includes (i) all of the issued and outstanding capital stock or other
equity interests of each direct Subsidiary (other than any such Subsidiary not
organized under the laws of, or having a principal place of business in, the
United States of America or any State, the District of Columbia or any territory
or possession of the United States of America (each such Subsidiary, a "FOREIGN
SUBSIDIARY")) and (ii) at least 65% of the issued and outstanding capital stock
or other equity interests of each Foreign Subsidiary that is directly owned by a
direct subsidiary that is not a Foreign Subsidiary (or, in each case, such lower
percentage of such stock as is owned by the relevant Grantor). All of the
Pledged Equity Interests have been duly authorized and validly issued, and is
fully paid and non-assessable, and is subject to no options to purchase or
similar rights of any Person. The Pledged Notes include any of the promissory
notes or other instruments evidencing
10
Indebtedness owed by any Subsidiary to the Grantors. The Grantors are not and
will not become parties to or otherwise bound by any agreement, other than this
Agreement, the DIP Credit Agreement and the Pre-Petition Credit Agreement, that
restricts in any manner the rights of any present or future holder of any of the
Pledged Securities with respect thereto. No Subsidiary is under any contractual
obligation to issue any additional shares of stock or any other securities,
rights or indebtedness.
(i) Upon the delivery of the Pledged Notes and certificates
representing the Pledged Equity Interests in accordance with Section 3 hereof,
(i) the Collateral Agent will have valid and perfected security interests in the
Collateral consisting of such Pledged Securities subject to no prior Lien, (ii)
the Collateral Agent will have "control" (as specified in Sections 8-106 and
9-115(e) of the UCC) of such Pledged Securities and (iii) the Collateral Agent
will be a "protected purchaser" (within the meaning of Section 8-303(a) of the
UCC) thereof.
(j) Except for the Orders, no authorization, approval or other
action by, and no notice to or filing with, any governmental authority or
regulatory body is required for the grant and pledge by each of the Grantors of
the security interests granted hereby, the validity and enforceability thereof
or for the execution, delivery or performance of this Agreement by each of the
Grantors or for the perfection of the security interests or the exercise by the
Collateral Agent of its rights and remedies hereunder.
(k) If and when any Financial Asset or Security Entitlement is
held in the Concentration Account and pursuant to a control agreement, the
Collateral Agent will have "control" (as defined in Article 8 of the UCC)
thereof and will be a "protected purchaser" (as defined in said Article 8)
thereof.
(l) In respect of all Security Entitlements owned by the Grantors,
and all Securities Accounts to which the related Financial Assets are credited,
the jurisdiction (determined as provided in Section 8-110(e) of the UCC) of the
"securities intermediary" (as defined in Section 8-102(a)(14) of the UCC) is,
and will at all times continue to be, located in the United States.
SECTION 5. Further Assurances.
(a) Unless they shall have given the Collateral Agent not less
than 15 days' prior notice thereof, the Grantors will not (i) change their
names, identities or organizational structures in any manner or (ii) change
their jurisdictions of organization. The Grantors shall not in any event change
the location of any Collateral if such change would cause the Security Interests
in such Collateral to lapse or cease to be perfected.
11
(b) Each of the Grantors agrees that from time to time, at its own
expense and without further order of the Bankruptcy Court, it will promptly
execute, deliver, file and record all further statements, assignments,
additional pledge agreements, instruments, documents, notices and other
agreements or other paper, and take all further action (including, without
limitation, any mortgages, filings of financing or continuation statements or
amendments thereto under the UCC and any filings with the United States Patent
and Trademark Office or the United States Copyright Office), that may be
necessary, or that the Collateral Agent may reasonably request, in order to
create, preserve, confirm, validate, perfect and protect any security interest
granted or purported to be granted hereby or to enable the Collateral Agent to
exercise and enforce any of its rights, powers and remedies hereunder with
respect to any Collateral. Without limiting the generality of the foregoing, and
without further order of the Bankruptcy Court, each of the Guarantors will file
such financing or continuation statements, or amendments thereto, and such other
instruments or notices, as may be necessary, or as the Collateral Agent may
reasonably request, in order to perfect and preserve the security interests
granted or purported to be granted hereby.
(c) Each Grantor hereby authorizes the Collateral Agent to execute
and file one or more financing or continuation statements, and amendments
thereto, relative to all or any part of the Collateral without the signature of
such Grantor where permitted by applicable law.
(d) The Grantors agree that a carbon, photographic, photostatic or
other reproduction of this Agreement or of a financing statement is sufficient
as a financing statement to the extent permitted by applicable law. The Grantors
shall pay the costs of any recording or filing of any financing or continuation
statements concerning the Collateral and reasonable costs incidental thereto.
(e) Each Grantor will keep full and accurate books and records
relating to the Collateral, and stamp or otherwise mark such books and records
in such manner as the Collateral Agent or the Required DIP Lenders may
reasonably require in order to reflect the Security Interests.
(f) Each Grantor will furnish to the Collateral Agent from time to
time statements and schedules further identifying and describing the Collateral
and such other reports, evidence and information in connection with the
Collateral as the Collateral Agent may reasonably request, all in reasonable
detail.
(g) If requested by the Collateral Agent, each Grantor will
immediately deliver and pledge each Instrument to the Collateral Agent,
appropriately endorsed to the Collateral Agent, provided that so long as no
Event of Default has occurred and is continuing, the Grantors may retain for
collection in the ordinary course any Instruments (other than checks and drafts
constituting payments in
12
respect of Accounts, as to which the provisions of Section 6(a) shall apply)
received by them in the ordinary course of business and the Collateral Agent
shall, promptly upon request of the Grantors, make appropriate arrangements for
making any other Instrument pledged by a Grantor available to it for purposes of
presentation, collection or renewal (any such arrangement to be effected, to the
extent deemed appropriate to the Collateral Agent, against trust receipt or like
document).
(h) Each Grantor hereby covenants and agrees that, with respect to
any material letter of credit hereafter arising to which it is a beneficiary, it
shall obtain the consent of the issuer thereof to the assignment of the proceeds
of such letter of credit to the Collateral Agent.
SECTION 6. Concentration Account.
Except as otherwise provided in any Order applicable to a Grantor:
(a) The Grantors shall instruct all account debtors and other
Persons obligated in respect of any Accounts or in respect of any Rolling Stock
Revenues to make all payments in respect of such Accounts or Rolling Stock
Revenues to an account maintained by the Grantors at either the Collateral Agent
or another bank or financial institution satisfactory to the Collateral Agent
(and, if such account shall not be at the Collateral Agent, if requested by the
Collateral Agent, such bank or finance institution shall have entered into a
"Control Agreement" with the Collateral Agent with respect to such account) by
instructing that such payments be either (i) remitted to a post office box which
shall be in the name and under the control of the Collateral Agent or (ii)
remitted by immediately available funds or other electronic or ACH transmissions
directly to such account, or (iii) to one or more banks in any state (other than
Louisiana) in the United States as designated or approved by the Collateral
Agent under a Lockbox Letter substantially in the form of Exhibit E hereto duly
executed by the Grantors and such bank or under other arrangements, in form and
substance satisfactory to the Collateral Agent, pursuant to which the Grantors
shall have irrevocably instructed such other bank (and such other bank shall
have agreed) to remit all proceeds of such payments directly to the Collateral
Agent for deposit into the Concentration Account or as the Collateral Agent may
otherwise instruct such other bank. All such payments made to the Collateral
Agent shall be deposited in the Concentration Account. In addition to the
foregoing, each Grantor agrees that if the proceeds of any Collateral hereunder
(including the payments made in respect of Accounts or Rolling Stock Revenues)
shall be received by it when an Event of Default has occurred and is continuing,
it shall as promptly as possible deposit such proceeds into the Concentration
Account. Until so deposited, all such proceeds shall be held in trust by the
Grantors for and as the property of the Collateral Agent and the other Secured
Parties and shall not be commingled with any other funds or property of the
Grantors.
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(b) The balance from time to time standing to the credit of the
Concentration Account shall, except (i) upon the occurrence and continuation of
a Default and (ii) as otherwise provided in Section 2.13 of the DIP Credit
Agreement, be available for distribution to the Grantors to the extent that
current day receipts are insufficient to fund approved expenditures
substantially consistent with the Budget, and so long as no Default has occurred
and is continuing. To the extent that current day receipts exceed approved
expenditures, such excess funds shall be transferred to the Concentration
Account. If immediately available cash on deposit in the Concentration Account
is not sufficient to make any distribution to the Grantors referred to in the
previous sentence of this Section 6(b), the Collateral Agent shall liquidate as
promptly as practicable Liquid Investments (as defined below) as required to
obtain sufficient cash to make such distribution and, notwithstanding any other
provision of this Section 6, such distribution (other than the distribution of
any immediately available cash then on deposit) shall not be made until such
liquidation has taken place. Upon the occurrence and continuation of an Event of
Default, the Collateral Agent shall, if so instructed by the Required DIP
Lenders, apply or cause to be applied (subject to collection) any or all of the
balance from time to time standing to the credit of the Concentration Account in
the manner specified in Section 18.
(c) Any income received by the Collateral Agent with respect to
the balance from time to time standing to the credit of the Concentration
Account, including any interest or capital gains on Liquid Investments (as
defined below), shall remain, or be deposited, in the Concentration Account. All
right, title and interest in and to the cash amounts on deposit from time to
time in the Concentration Account together with any Liquid Investments from time
to time made pursuant to Subsection 6(d) hereof shall vest in the Collateral
Agent, shall constitute part of the Collateral hereunder and shall not
constitute payment of the Obligations until applied thereto as hereinafter
provided.
(d) Amounts on deposit in the Concentration Account shall be
invested and re-invested from time to time in such Liquid Investments as the
Grantors shall determine, which Liquid Investments shall be held in the name and
be under the control of the Collateral Agent, provided that, if an Event of
Default has occurred and is continuing, the Collateral Agent shall, if
instructed by the Required DIP Lenders, liquidate any such Liquid Investments
and apply or cause to be applied the proceeds thereof to the payment of the
Obligations in the manner specified in Section 18. For purposes of this
Agreement, "LIQUID INVESTMENTS" means Permitted Investments; provided that (x)
each Liquid Investment shall mature within 30 days after it is acquired by the
Collateral Agent and (y) in order to provide the Collateral Agent, for the
benefit of the Secured Parties, with a perfected security interest therein, each
Liquid Investment shall be either:
14
(i) evidenced by negotiable certificates or instruments,
or if non-negotiable then issued in the name of the Collateral Agent,
which (together with any appropriate instruments of transfer) are
delivered to, and held by, the Collateral Agent or an agent thereof
(which shall not be the Grantors or any of their Affiliates) in the
State of New York; or
(ii) in book-entry form and issued by the United States
and subject to pledge under applicable state law and Treasury
regulations and as to which (in the opinion of counsel to the
Collateral Agent) appropriate measures shall have been taken for
perfection of the Security Interests.
SECTION 7. As to Equipment and Inventory. Each Grantor shall:
(a) [intentionally deleted]
(b) subject to provisions of the DIP Credit Agreement, maintain or
cause to be maintained in good repair, working order and condition, excepting
ordinary wear and tear and damage due to casualty, all of the Equipment, and
make or cause to be made all appropriate repairs, renewals and replacements
thereof, to the extent not obsolete and consistent with past practice of such
Grantor, as quickly as practicable after the occurrence of any loss or damage
thereto that are necessary or reasonably desirable to such end, except where the
failure to do any of the foregoing would not result in a Material Adverse
Effect;
(c) (i) if requested by the Collateral Agent, in the case of
Equipment now owned constituting goods in which a security interest is perfected
by a notation on the certificate of title or similar evidence of the ownership
of such goods, and (ii) within 10 days of acquiring any other similar Equipment
(x) having a value in excess of $100,000 or (y) having a value in excess of
$100,000, if the aggregate of all such items owned by the Grantors at any time
is greater than $1,000,000, deliver to the Collateral Agent any and all
certificates of title, applications for title or similar evidence of ownership
of such Equipment and shall cause the Collateral Agent to be named as lienholder
on any such certificate of title or other evidence of ownership. Each Grantor
shall promptly inform the Collateral Agent of any additions to or deletions from
the Equipment and shall not permit any such items to become a fixture to real
estate;
(d) if requested by the Collateral Agent, at its own cost and
expense, cause to be plainly, distinctly, permanently and conspicuously placed,
fastened or painted upon each side of each item of Rolling Stock a legend in
letters not less than one inch in height bearing such words as the Collateral
Agent may request indicating the Lien over and security interest in such Rolling
Stock created hereby. Each Grantor may permit the Rolling Stock to be operated
within the United States, but shall not permit the Rolling Stock to be operated
outside the boundaries of the continental United States;
15
(e) within five (5) Business Days after entering into, amending,
modifying or terminating any Rolling Stock Lease, deliver a copy of such Rolling
Stock Lease, amendment or modification or notice of such termination to the
Collateral Agent;
(f) not, without the prior written consent of the Required DIP
Lenders, sell, lease, exchange, assign or otherwise dispose of, or grant any
option with respect to, any Equipment or Inventory except that, subject to the
rights of the Collateral Agent and the Secured Parties hereunder if an Event of
Default has occurred and be continuing, the Grantors may (i) sell, lease or
exchange Inventory and obsolete, unused or unnecessary Equipment, in each case
in the ordinary course of business, and (ii) consummate any disposition of
assets permitted by the terms of the DIP Credit Agreement;
(g) until satisfaction in full of the Obligations, at any time
when an Event of Default has occurred and is continuing: (i) perform any and all
reasonable actions requested by the Collateral Agent to enforce the Collateral
Agent's security interest in the Inventory and all of the Collateral Agent's
rights hereunder, such as leasing warehouses to the Collateral Agent or its
designee, placing and maintaining signs, appointing custodians, transferring
Inventory to warehouses, and delivering to the Collateral Agent warehouse
receipts and documents of title in the Collateral Agent's name; and (ii) if any
Inventory is in the possession or control of any warehouseman, bailee or any of
the Grantors' agents, contractors or processors or any other third party, notify
the Collateral Agent thereof and notify such agents, contractors or processors
or third parties of the Collateral Agent's security interest therein and, upon
request of the Collateral Agent acting on the instruction of the Required DIP
Lenders, instruct them to hold all such Inventory for the Collateral Agent and
such Grantor's account, as their interests may appear, and subject to the
Collateral Agent's instructions. At any time when an Event of Default has
occurred and is continuing, the Collateral Agent shall have the right to hold
all Inventory subject to the Security Interest granted hereunder and the right
to take possession of the Inventory or any part thereof and to maintain such
possession on a Grantor's premises or to remove any or all of the Inventory to
such other place or places as the Collateral Agent desires in its sole
discretion. If the Collateral Agent exercises its right to take possession of
the Inventory, such Grantor, upon the Collateral Agent's demand, will assemble
the Inventory and make it available to the Collateral Agent at such Grantor's
premises at which it is located.
SECTION 8. As to Accounts.
(a) Each Grantor will hold and preserve such records and chattel
paper and will permit representatives of the Collateral Agent, at any time
during normal
16
business hours, to inspect and make abstracts from such records and chattel
paper in accordance with Section 5.06 of the DIP Credit Agreement.
(b) Except as otherwise provided in this subsection (b), each
Grantor shall continue to collect, in accordance with its customary practice, at
its own expense, all amounts due or to become due to such Grantor under the
Accounts (including, without limitation, Accounts that are delinquent, such
Accounts to be collected in accordance with lawful collection procedures) and
shall apply forthwith upon receipt thereof all such amounts as are so collected
to the outstanding balance of such Account. Prior to the occurrence and
continuance of an Event of Default, such Grantor shall have the right to adjust,
settle or compromise the amount or payment of any Account, or release wholly or
partly any account debtor or obligor thereof, or allow any credit or discount
thereon, all in accordance with its customary practices. In connection with such
collections, upon the occurrence and during the continuation of an Event of
Default, the Grantors shall take such actions as the Grantors or the Collateral
Agent may deem necessary or advisable to enforce collection of the Accounts;
provided, that upon written notice by the Collateral Agent to any Grantor,
following the occurrence and during the continuation of an Event of Default, of
its intention so to do, the Collateral Agent shall have the right to notify, or
to instruct the Grantors to so notify, the account debtors or obligors under any
Accounts of the assignment of such Accounts to the Collateral Agent and to
direct such account debtors or obligors to make payment of all amounts due or to
become due to such Grantor thereunder directly to the Collateral Agent or its
designee and, upon such notification and at the expense of such Grantor, to
enforce collection of any such Accounts, and to adjust, settle or compromise the
amount or payment thereof, in the same manner and to the same extent as such
Grantor might have done. After receipt by such Grantor of the notice referred to
in the proviso to the preceding sentence, (i) all amounts and proceeds
(including instruments) received by such Grantor in respect of the Accounts
shall be received in trust for the benefit of the Collateral Agent (for the
ratable benefit of the Secured Parties) hereunder, shall be segregated from
other funds of the Grantors and shall be forthwith paid over to the Collateral
Agent in the same form as so received (with any necessary endorsement) to be
held as cash collateral and either (A) released to the Grantors if such Event of
Default shall have been cured or waived or (B) if such Event of Default shall be
continuing, applied as provided by Section 18, and (ii) the Grantors shall not,
without the written consent of the Collateral Agent, adjust, settle or
compromise the amount or payment of any Account, or release wholly or partly any
account debtor or obligor thereof, or allow any credit or discount thereon.
SECTION 9. As to Trademarks, Patents and Copyrights.
(a) Each Grantor shall, either itself or through licensees,
continue to use the Trademarks as each is currently used in the Grantor's
business in order to
17
maintain the Trademarks in full force free from any claim of abandonment for
nonuse and each such Grantor will not (and will not permit any licensee thereof
to) do any act or knowingly omit to do any act whereby any Trademark may become
invalidated, unless such failure to use a Trademark is not reasonably likely to
have a Material Adverse Effect.
(b) No Grantor will do any act, or omit to do any act, whereby the
Patents or Copyrights may become abandoned or dedicated and each such Grantor
shall notify the Collateral Agent immediately if it knows of any reason or has
reason to know that any application or registration relating to any material
Copyright, Trademark or Patent may become abandoned or dedicated, or of any
adverse determination or development (including, without limitation, the
institution of, or any such determination or development in, any proceeding in
the United States Copyright Office, the United States Patent and Trademark
Office or any court) regarding any Grantor's ownership of any Copyright, Patent
or Trademark, its right to register the same or to keep and maintain the same,
unless such abandonment or dedication is not reasonably likely to have a
Material Adverse Effect.
(c) Each Grantor will give the Collateral Agent 30 days prior
written notice of its intention to file, either itself or through any agent,
employee or licensee, an application for the registration of any Copyright with
the United States Copyright Office or any Patent or Trademark with the United
States Patent and Trademark Office, or with any similar office or agency in any
other country or any political subdivision thereof.
(d) Each Grantor will take all necessary steps in any proceeding
before the United States Patent and Trademark Office, the United States
Copyright Office or any similar office or agency in any other country or any
political subdivision thereof, to maintain in all material respects each
application and registration of all material Trademarks, Patents and Copyrights,
including, without limitation, filing of renewals, affidavits of use, affidavits
of incontestability and opposition, interference and cancellation proceedings.
(e) Each Grantor will, without further order of the Bankruptcy
Court, perform all acts and execute and deliver all further agreements,
instruments and documents, including, without limitation, assignments for
security in form suitable for filing with the United States Patent and Trademark
Office and the United States Copyright Office, respectively, requested by the
Collateral Agent at any time to evidence, perfect, maintain, record and enforce
the Collateral Agent's security interest in all Trademarks, Patents and
Copyrights and the goodwill and general intangibles of the Grantors relating
thereto or represented thereby, or otherwise in furtherance of the provisions of
this Agreement, and each Grantor hereby appoints the Collateral Agent its
attorney-in-fact and authorizes the Collateral Agent to execute and file one or
more financing statements and similar
18
documents (which may be signed only by the Collateral Agent) or copies thereof
or of this Security Agreement with respect to Patents, Trademarks and
Copyrights. All acts of such attorney are hereby ratified and confirmed; such
power, being coupled with an interest, shall be irrevocable until the
Obligations are paid in full.
(f) In the event that any Copyright, Copyright License, Patent,
Patent License, Trademark or Trademark License is infringed, misappropriated or
diluted by a third party, each of the Grantors shall notify the Collateral Agent
promptly after it learns thereof and shall, unless the Grantors shall reasonably
determine that any such action would be of negligible economic value to it
(without accounting for any liens on the proceeds of any recovery), promptly sue
for infringement, misappropriation or dilution and to recover any and all
damages for such infringement, misappropriation or dilution, and take such other
actions as the Grantors shall reasonably deem appropriate under the
circumstances to protect such Copyright, Copyright License, Patent, Patent
License, Trademark or Trademark License. Each Grantor will, upon acquiring
knowledge of any use by any person of any term or design likely to cause
confusion with any material Trademark, promptly notify the Collateral Agent of
such use, and, if requested by the Collateral Agent, shall join with the
Collateral Agent, at such Grantor's expense, in such action as the Collateral
Agent, in its reasonable discretion, may deem advisable for the protection of
the Collateral Agent's interest in and to the Trademarks.
(g) Each Grantor shall continue to use reasonable and proper
statutory notice in connection with its use of each registered Patent, Trademark
and Copyright.
SECTION 10. As to the Pledged Securities; Voting Rights; Dividends;
Etc.
(a) Each Grantor will promptly give to the Collateral Agent copies
of any notices or other communications received by it with respect to Pledged
Securities registered in its name, and the Collateral Agent will promptly give
to the Grantors copies of any notices and communications received by the
Collateral Agent with respect to Pledged Securities registered in the name of
the Collateral Agent or its nominee.
(b) So long as no Event of Default shall have occurred and be
continuing:
(i) the Grantors (as applicable) shall be entitled from
time to time to exercise any and all voting and other consensual
rights, ratifications and waivers pertaining to the Pledged Securities
or any part thereof for any purpose not inconsistent with the terms of
this Agreement or any of the Loan Documents;
19
(ii) notwithstanding the provisions of Section 1 hereof,
such Grantors shall be entitled to receive and retain any and all
dividends paid in respect of the Pledged Securities; provided, that
any and all
(A) dividends paid or payable other than in cash
in respect of, and instruments and other property received,
receivable or otherwise distributed in respect of, or in
exchange for, any Pledged Securities,
(B) dividends and other distributions paid or
payable in cash in respect of any Pledged Securities in
connection with a partial or total liquidation or dissolution
or in connection with a reduction of capital, capital surplus
or paid-in-surplus, and
(C) cash paid, payable or otherwise distributed
in respect of, or in redemption of, or in exchange for, any
Pledged Securities
shall, unless otherwise provided in the Loan Documents, forthwith be
delivered to the Collateral Agent to hold as Pledged Securities and shall, if
received by any of the Grantors, be received in trust for the benefit of the
Collateral Agent, be segregated from the other property or funds of such
Grantor, and be forthwith delivered to the Collateral Agent as Pledged
Securities in the same form as so received (with any necessary endorsement); and
(iii) the Collateral Agent shall execute and deliver (or
cause to be executed and delivered) to the Grantors (as applicable),
upon receiving a written request from the Grantors accompanied by a
certificate signed by its principal financial officer stating that no
Event of Default has occurred and is continuing, all such proxies,
powers of attorney, consents, ratifications and waivers in respect of
any of the Pledged Equity Interests that is registered in the name of
the Collateral Agent or its nominee as shall be specified in such
request and be in form and substance satisfactory to the Collateral
Agent in its reasonable judgment, as the Grantors (as applicable) may
reasonably request for the purpose of enabling such Grantors to
exercise the voting and other rights they are entitled to exercise
pursuant to paragraph (i) above and to receive the dividends they are
authorized to receive and retain pursuant to paragraph (ii) above.
(c) Upon the occurrence and during the continuance of an Event of
Default:
(i) upon written notice from the Collateral Agent to the
Grantors (as applicable) to such effect, all rights of such Grantors
(as applicable) to
20
exercise the voting and other consensual rights they would otherwise be
entitled to exercise pursuant to Section 10(b)(i) and to receive the
dividends they would otherwise be authorized to receive and retain
pursuant to Section 10(b)(ii) shall cease, and all such rights shall
thereupon become vested in the Collateral Agent, who shall thereupon
have the sole right to exercise such voting and other consensual rights
and to receive and hold as Pledged Securities any such dividends; and
(ii) all dividends and other distributions that are
received by such Grantors contrary to the provisions of this Section
shall be received in trust for the benefit of the Collateral Agent,
shall be segregated from other funds of the Grantors and shall be
forthwith paid over to the Collateral Agent as Pledged Securities in
the same form as so received (with any necessary endorsement).
SECTION 11. The Mortgages. In the event that any of the Collateral
hereunder is also subject to a valid and enforceable Lien under the terms of any
mortgage, deed of trust or lease hold mortgage and the terms of such mortgage,
deed of trust or lease hold mortgage are inconsistent with the terms of this
Agreement, then with respect to such Collateral, the terms of such mortgage,
deed of trust or lease hold mortgage shall be controlling in the case of
fixtures and real estate leases, letting and licenses of, and contracts and
agreements relating to the lease of, real property, and the terms of this
Agreement shall be controlling in the case of all other Collateral.
SECTION 12. Insurance. Not later than 20 days after the Petition
Date, the Grantors will cause the Collateral Agent to be named as an insured
party and loss payee on each insurance policy covering risks relating to any of
its Inventory and Equipment. The Grantors will deliver to the Collateral Agent,
upon request of the Collateral Agent, the insurance policies for such insurance
or certificates of insurance evidencing such coverage. Each such insurance
policy shall include effective waivers by the insurer of all claims for
insurance premiums against the Collateral Agent or any Secured Party, provide
for coverage to the Collateral Agent regardless of the breach by the Grantors of
any warranty or representation made therein, not be subject to co-insurance, and
provide that no cancellation, termination or material modification of such
policies shall be effective until at least 30 days after receipt by the
Collateral Agent of notice thereof (except in the case of termination for
non-payment of premium, when 10 days notice shall be given). The Grantors hereby
appoint the Collateral Agent as their attorney-in-fact to make proofs of loss,
claims for insurance and adjustments with insurers, and to execute or endorse
all documents, checks or drafts in connection with payments made as a result of
any insurance policies to the extent that the Grantors fail or refuse to do so
within 10 days after a request by the Collateral Agent. Upon the occurrence and
during the continuance of any Event of Default, all insurance
21
payments shall be held, applied and paid to the Collateral Agent as specified in
Section 17 hereof.
SECTION 13. Transfers to Others; Liens; Additional Shares.
(a) Each Grantor shall not sell, assign (by operation of law or
otherwise) or otherwise dispose of any of the Collateral, except for
dispositions permitted by the DIP Credit Agreement.
(b) Each Grantor shall not create or suffer to exist any Lien upon
or with respect to any of the Collateral to secure any obligation of any person
or entity, except for Liens permitted by the DIP Credit Agreement.
(c) Each Grantor (as applicable) agrees that it will (i) cause
each of the Issuers that are wholly-owned Subsidiaries not to issue any stock or
other securities in addition to or substitution for the Pledged Equity Interests
issued by such Issuer, except to a Grantor and (ii) pledge hereunder,
immediately upon its acquisition (directly or indirectly) thereof, any and all
such additional shares of stock or other securities of each Issuer of the
Pledged Equity Interests.
SECTION 14. Collateral Agent Appointed Attorney-in-fact. Each Grantor
hereby irrevocably appoints the Collateral Agent such Grantor's attorney-in-fact
(which appointment shall be irrevocable and deemed coupled with an interest),
with full authority in the place and stead of such Grantor and in the name of
such Grantor or otherwise, from time to time in the Collateral Agent's
discretion, but at each Grantor's expense, upon and during the occurrence and
continuation of an Event of Default, to take any action and to execute any
instrument that the Collateral Agent may deem necessary or advisable to
accomplish the purposes of this Agreement, including, without limitation:
(a) to obtain and adjust insurance required to be paid to the
Collateral Agent pursuant to Section 12,
(b) to ask, demand, collect, sue for, recover, compound, receive
and give acquittance and receipts for moneys due and to become due under or in
respect of any of the Collateral,
(c) to receive, endorse, and collect any drafts or other
instruments, documents and chattel paper, in connection with clause (i) or (ii)
above,
(d) to sell, transfer, assign or otherwise deal in or with the
Collateral or the proceeds or avails thereof, as fully and
effectually as if the Collateral Agent were the absolute owner thereof,
22
(e) to extend the time of payment of any or all of the Collateral
and to make any allowance and other adjustments with reference thereto,
(f) to receive, endorse and collect all instruments made payable
to the Grantors representing any dividend or other distribution in respect of
the Pledged Securities or any part thereof and to give full discharge for the
same, and
(g) to file or settle, compromise, prosecute or defend any claims,
actions or proceedings that the Collateral Agent may deem necessary or desirable
to collect any of the Collateral or otherwise enforce the Collateral Agent's
rights with respect thereto;
provided, that the Collateral Agent shall give each Grantor not less than ten
days prior notice of the time and place of any sale or other intended
disposition of any of the Collateral, except any Collateral that is perishable
or threatens to decline speedily in value or is of a type customarily sold on a
recognized market. The Collateral Agent and the Grantors agree that such notice
constitutes "reasonable notification" within the meaning of Section 9-612 of the
UCC.
SECTION 15. Collateral Agent May Perform. If any Grantor fails to
perform any agreement contained herein, the Collateral Agent may itself perform,
or cause performance of, such agreement, and the reasonable expenses of the
Collateral Agent incurred in connection therewith shall be payable by the
Grantors under Section 19.
SECTION 16. The Collateral Agent's Duties. The provisions of Article
8 of the DIP Credit Agreement shall inure to the benefit of the Collateral Agent
in respect of this Agreement and shall be binding upon the parties to the DIP
Credit Agreement in such respect. The powers conferred on the Collateral Agent
hereunder are solely to protect its interests and the interests of the Secured
Parties in the Collateral and shall not impose any duty upon the Collateral
Agent to exercise any such powers. Except for the safe custody of any Collateral
in its possession and the accounting for moneys actually received by it
hereunder, the Collateral Agent shall have no duty as to any Collateral or as to
the taking of any necessary steps to preserve rights against prior parties or
any other rights pertaining to any Collateral, including, without limitation,
ascertaining or taking action with respect to calls, conversions, exchanges,
maturities, tenders or other matters relative to any Pledged Securities, whether
or not the Collateral Agent has or is deemed to have knowledge of such matters.
The Collateral Agent shall be deemed to have exercised reasonable care in the
custody of the Collateral in its possession if the Collateral is accorded
treatment substantially equal to that which it accords its own property, and the
Collateral Agent shall not be liable or responsible for any loss or damage to
any of the Collateral, or for any diminution in the value thereof, by reason of
the act or omission of any warehouseman,
23
carrier, forwarding agency, consignee or other agent or bailee selected by the
Collateral Agent in good faith and with reasonable care.
The Collateral Agent shall not be responsible for the existence,
genuineness or value of any of the Collateral or for the validity, perfection,
priority or enforceability of the Security Interests in any of the Collateral,
whether impaired by operation of law or by reason of any action or omission to
act on its part hereunder; provided that the Collateral Agent shall be
responsible if it executes and delivers any release of the Collateral that is
not authorized by the Grantors, the requisite DIP Lenders, or the terms of the
DIP Credit Agreement or this Agreement, if such execution and delivery is the
result of its own gross negligence or willful misconduct. The Collateral Agent
shall have no duty to ascertain or inquire as to the performance or observance
of any of the terms of this Agreement by the Grantors.
Pursuant to Article 8 of the DIP Credit Agreement, the Collateral Agent
has been authorized by the Secured Parties to take all such action provided to
be taken by it as Collateral Agent hereunder and all other action reasonably
incidental thereto. As to any matters not expressly provided for herein
(including, without limitation, the timing and methods of realization upon the
Collateral), the Collateral Agent shall act or refrain from acting in accordance
with written instructions from the Required DIP Lenders or, in the absence of
such instructions, in accordance with its discretion.
SECTION 17. Remedies. If any Event of Default shall have occurred and
be continuing, and subject to the provisions of Article 7 of the DIP Credit
Agreement:
(a) The Collateral Agent may exercise in respect of the
Collateral, in addition to other rights and remedies provided for herein or
otherwise available to it, and without application to or order of the Bankruptcy
Court, all the rights and remedies of a secured party on default under the UCC
(whether or not in effect in the jurisdiction where such rights are exercised)
and also may, without being required to give any notice, except as specifically
provided herein or as may be required by mandatory provisions of law, (i)
withdraw all cash and Liquid Investments in the Concentration Account and apply
such cash and Liquid Investments and other cash, if any, then held by it as
Collateral as specified in Section 18 and (ii) if there shall be no such cash or
Liquid Investments, or if such cash and Liquid Investments shall be insufficient
to pay all the Obligations in full, sell the Collateral or any part thereof in
one or more parcels at public or private sale, at any of the Collateral Agent's
offices or elsewhere, for cash, on credit or for future delivery, and at such
price or prices and upon such other terms as the Collateral Agent may, in its
sole discretion, deem commercially reasonable. The Collateral Agent or any
Secured Party may be the purchaser of any or all of the Collateral so sold at
any public sale (or, if the Collateral is of a type customarily
24
sold in a recognized market or is of a type that is the subject of widely
distributed standard price quotations, at any private sale). The Grantors will
execute and deliver such documents and take such other action as the Collateral
Agent deems necessary or advisable in order that any such sale may be made in
compliance with law. Upon any such sale, the Collateral Agent shall have the
right to deliver, assign and transfer to the purchaser the Collateral sold. Each
purchaser at any such sale shall hold the Collateral so sold to it absolutely
and free from any claim or right of whatever kind, including any equity or right
of redemption of the Grantors that may be waived, and the Grantors, to the
extent permitted by law, hereby specifically waive all rights of redemption,
stay or appraisal that they have or may have under any law now existing or
hereafter adopted. Each Grantor agrees that, to the extent notice of such sale
shall be required by law, ten days notice to the Grantors of the time and place
of any public sale or the time after which any private sale is to be made shall
constitute reasonable notification. Any such public sale shall be held at such
time or times within ordinary business hours and at such place or places as the
Collateral Agent may fix in the notice of such sale. At any such sale the
Collateral may be sold in one lot as an entirety or in separate parcels, as the
Collateral Agent may determine. The Collateral Agent shall not be obligated to
make any sale of Collateral regardless of notice of sale having been given. The
Collateral Agent may adjourn any public or private sale from time to time by
announcement at the time and place fixed therefor, and such sale may, without
further notice, be made at the time and place to which it was so adjourned. In
the case of any sale of all or any part of the Collateral on credit or for
future delivery, the Collateral so sold shall be retained by the Collateral
Agent until the selling price is paid by the purchaser thereof, but the
Collateral Agent shall not incur any liability in the case of the failure of
such purchaser to take up and pay for the Collateral so sold and, in the case of
any such failure, such Collateral may again be sold upon like notice. The
Collateral Agent, instead of exercising the power of sale herein conferred upon
it, may proceed by a suit or suits at law or in equity to foreclose the Security
Interests and sell the Collateral, or any portion thereof, under a judgment or
decree of a court or courts of competent jurisdiction. For the purposes of
obtaining executory process, each Grantor does hereby confess judgment in favor
of the Collateral Agent for the full amount of the Obligations.
In furtherance and not in derogation of the Collateral Agent's rights
hereunder and under the other Loan Documents, each Grantor does by these
presents consent, agree and stipulate that upon the occurrence of an Event of
Default and so long as it is continuing, it shall be lawful for the Collateral
Agent, and the Grantors do hereby authorize the Collateral Agent, to cause any
and all of the Collateral to be seized and sold under executory or ordinary
process, at the Collateral Agent's sole option, without appraisement,
appraisement being hereby expressly waived, as an entirety or in parcels as the
Collateral Agent may determine, to the highest bidder for cash, and otherwise
exercise the rights, powers and remedies afforded herein and under applicable
Louisiana law. Any
25
and all declarations of fact made by authentic act before a Notary Public in the
presence of two witnesses by a person declaring that such facts lie within his
or her knowledge shall constitute authentic evidence of such facts for the
purpose of executory process. Each Grantor hereby waives in favor of the
Collateral Agent: (a) the benefit of appraisement as provided in Louisiana Code
of Civil Procedure Articles 2332, 2336, 2723 and 2724, and all other laws
conferring the same; (b) the demand and three days delay accorded by Louisiana
Code of Civil Procedure Articles 2639 and 2721; (c) the notice of seizure
required by Louisiana Code of Civil Procedure Articles 2293 and 2721; (d) the
three days delay provided by Louisiana Code of Civil Procedure Articles 2331 and
2722; and (e) the benefit of the other provisions of Louisiana Code of Civil
Procedure Articles 2331, 2722, and 2723, not specifically mentioned above. The
Collateral Agent is hereby appointed agent and attorney-in-fact for the Grantors
and is hereby authorized and empowered to carry out and enforce all of the
incorporeal rights in which the Grantors have granted a security interest to the
Collateral Agent hereunder. This mandate and power of attorney, being coupled
with an interest, is irrevocable so long as the Security Interests granted
hereunder remain in effect. In the event the Collateral or any part thereof is
seized as an incident to an action for the recognition or enforcement of this
Agreement by executory process, ordinary process, sequestration, writ of fieri
facias, or otherwise, the Grantors and the Collateral Agent agree that the court
issuing any such order shall, if petitioned for by the Collateral Agent, direct
the applicable sheriff to appoint as a keeper of the Collateral, the Collateral
Agent or any agent designated by the Collateral Agent or any person named by the
Collateral Agent at the time such seizure is effected. This designation is
pursuant to Louisiana Revised Statutes 9:5136-9:5140.1 and the Collateral Agent
shall be entitled to all the rights and benefits afforded thereunder as the same
may be amended. It is hereby agreed that the keeper shall be entitled to receive
as compensation, in excess of its costs and expenses incurred in the
administration or preservation of the Collateral, an amount equal to five (5%)
percent of the gross revenues and other amounts received by the keeper, payable
on a monthly basis. The designation of keeper made herein shall not be deemed to
require the Collateral Agent to provoke the appointment of such a keeper.
(b) For the purpose of enforcing any and all rights and remedies
under this Agreement the Collateral Agent may, at any time when an Event of
Default has occurred and is continuing, (i) require the Grantors to, and the
Grantors agree that they will, at their expense and upon the request of the
Collateral Agent, forthwith assemble all or any part of the Collateral as
directed by the Collateral Agent and make it available at a place designated by
the Collateral Agent that is, in the Collateral Agent's opinion, reasonably
convenient to the Collateral Agent and the Grantors, whether at the premises of
the Grantors or otherwise, (ii) to the extent permitted by applicable law,
enter, with or without process of law and without breach of the peace, any
premises where any of the Collateral is or may be located, and without charge or
liability to it seize and remove such Collateral
26
from such premises, (iii) have access to and use each Grantor's books and
records relating to the Collateral and (iv) prior to the disposition of the
Collateral, store or transfer it without charge by the Grantors in or by means
of any storage or transportation facility owned or leased by the Grantors,
process, repair or recondition it or otherwise prepare it for disposition in any
commercially reasonable manner and to the extent the Collateral Agent deems
appropriate in its reasonable judgment and, in connection with such preparation
and disposition, use without charge any Trademark, trade name, Copyright, Patent
or technical process used by the Grantors; provided that such use of any
federally registered trademark shall be subject to such oversight of the quality
of the goods and services to which such mark is affixed as is necessary to
maintain such registration. The Collateral Agent may also render any or all of
the Collateral unusable at each Grantor's premises and may dispose of such
Collateral on such premises without liability for rent or costs.
(c) The Collateral Agent may instruct the Grantors not to make any
further use of the Patents, Copyrights or Trademarks or any mark similar thereto
for any purpose to the extent that such use would be inconsistent with the
exercise by the Collateral Agent of any other remedies under this Section.
(d) The Collateral Agent may license, or sublicense, whether
general, special or otherwise, and whether on an exclusive or nonexclusive
basis, any of the Trademarks, Patents or Copyrights included in the Collateral
throughout the world for such term or terms, on such conditions and in such
manner as the Collateral Agent shall in its sole discretion determine.
(e) The Collateral Agent may (without assuming any obligations or
liability thereunder), at any time and from time to time, enforce (and shall
have the exclusive right to enforce) against any licensee or sublicensee all
rights and remedies of the Grantors in, to and under any one or more license
agreements with respect to the Collateral, and take or refrain from taking any
action thereunder, and each of the Grantors hereby releases the Collateral Agent
from, and agrees to hold the Collateral Agent free and harmless from and against
any claims arising out of, any action taken or omitted to be taken with respect
to any such license agreement.
(f) Upon request by the Collateral Agent, the Grantors will
execute and deliver to the Collateral Agent a power of attorney, in form and
substance satisfactory to the Collateral Agent in its reasonable judgment, for
the implementation of any lease, assignment, license, sublicense, grant of
option, sale or other disposition of a Copyright, Patent or Trademark. In the
event of any such license, assignment, sale or other disposition of the
Collateral, or any of it, each Grantor shall supply, to the Collateral Agent or
its designee, its know-how and expertise relating to the manufacture and sale of
the products bearing or in connection with the Trademarks, or the products or
services made or rendered in
27
connection with Patents or Copyrights, and its customer lists and other records
relating to the Trademarks, Patents or Copyrights, and to the distribution of
said products.
(g) In order to implement the assignment, sale or other disposal
of any of the Trademarks, Patents or Copyrights, the Collateral Agent may, at
any time, pursuant to the authority granted in Section 14 hereof, execute and
deliver on behalf of the Grantors, one or more instruments of assignment of the
Trademarks, Patents or Copyrights (or any application of registration thereof),
in form suitable for filing, recording or registration in any country.
(h) All cash proceeds received by the Collateral Agent in respect
of any sale of, collection from or other realization upon all or any part of the
Collateral may, in the discretion of the Collateral Agent, be held by the
Collateral Agent as collateral for, and then or at any time thereafter applied
(after payment of any amounts payable to the Collateral Agent pursuant to
Section 19 hereof) in whole or in part against, all or any part of the
Obligations as provided for in Section 18.
(i) If at any time when the Collateral Agent shall determine to
exercise its right to sell all or any part of the Pledged Securities pursuant to
this Section 17, and such Pledged Securities or the part thereof to be sold
shall not be effectively registered under the Securities Act of 1933, as
amended, and as from time to time in effect, and the rules and regulations
thereunder ( the "SECURITIES ACT"), the Collateral Agent is hereby expressly
authorized to sell such Pledged Securities or such part thereof by private sale
in such manner and under such circumstances as the Collateral Agent may deem
necessary or advisable in order that such sale may legally be effected without
such registration. Without limiting the generality of the foregoing, in any such
event the Collateral Agent, in compliance with applicable securities laws, (a)
may proceed to make such private sale notwithstanding that a registration
statement for the purpose of registering such Pledged Securities or such part
thereof shall have been filed under such Securities Act, (b) may approach and
negotiate with a restricted number of potential purchasers to effect such sale
and (c) may restrict such sale to purchasers as to their number, nature of
business and investment intention including, without limitation, to purchasers
each of whom will represent and agree to the satisfaction of the Collateral
Agent that such purchaser is purchasing for its own account, for investment, and
not with a view to the distribution or sale of such Pledged Securities, or part
thereof, it being understood that the Collateral Agent may cause or require each
Grantor, and each Grantor hereby agrees upon the written request of the
Collateral Agent, to cause (i) a legend or legends to be placed on the
certificates to be delivered to such purchasers to the effect that the Pledged
Securities represented thereby have not been registered under the Securities Act
and setting forth or referring to restrictions on the transferability of such
securities; and (ii) the issuance of stop transfer instructions to such Issuer's
transfer agent, if any, with respect to the Pledged Securities, or, if such
Issuer
28
transfers its own securities, a notation in the appropriate records of such
Issuer. The Grantors will execute and deliver such documents and take such other
action as the Collateral Agent deems necessary or advisable in its reasonable
judgment in order that any such sale may be made in compliance with the law.
Upon any such sale the Collateral Agent shall have the right to deliver, assign
and transfer to the purchaser thereof the Pledged Securities so sold. Each
purchaser at any such sale shall hold the Pledged Securities so sold absolutely
and free from any claim or right of whatsoever kind of the Grantors, including
any equity or right of redemption of the Grantors that may be waived, and each
Grantor, to the extent permitted by law, hereby specifically waives all rights
of redemption, stay or appraisal that it has or may later have under any law now
existing or hereafter adopted. The notice (if any) of such sale required by
Section 13 shall (1) in the case of a public sale, state the time and place
fixed for such sale, (2) in the case of a sale at a broker's board or on a
securities exchange, state the board or exchange at which such sale is to be
made and the day on which the Pledged Securities, or the portion thereof so
being sold, will first be offered for sale at such board or exchange, and (3) in
the case of a private sale, state the day after which such sale may be
consummated. Any such public sale shall be held at such time or times within
ordinary business hours and at such place or places as the Collateral Agent may
fix in the notice of such sale. At any such sale the Pledged Securities may be
sold in one lot as an entirety or in separate parcels, as the Collateral Agent
may determine. The Collateral Agent shall not be obligated to make any such sale
pursuant to any such notice. The Collateral Agent may, without notice or
publication, adjourn any public or private sale or cause the same to be
adjourned from time to time by announcement at the time and place fixed for the
sale, and such sale may be made at any time or place to which the same may be so
adjourned. In the case of any sale of all or any part of the Pledged Securities
on credit or for future delivery, the Pledged Securities so sold shall be
retained by the Collateral Agent until the selling price is paid by the
purchaser thereof, but the Collateral Agent shall not incur any liability in the
case of the failure of such purchaser to take up and pay for the Pledged
Securities so sold and, in the case of any such failure, such Pledged Securities
may again be sold upon like notice. The Collateral Agent, instead of exercising
the power of sale herein conferred upon it, may proceed by a suit or suits at
law or in equity to foreclose the Security Interests and sell the Pledged
Securities, or any portion thereof, under a judgment or decree of a court or
courts of competent jurisdiction. In the event of any such sale, each Grantor
does hereby consent and agree that the Collateral Agent shall incur no
responsibility or liability for selling all or any part of the Pledged
Securities at a price the Collateral Agent may deem reasonable under the
circumstances, notwithstanding the possibility that a substantially higher price
might be realized if the sale were public and deferred until after registration
as aforesaid.
29
SECTION 18. Application of Proceeds.
(a) Upon the occurrence and during the continuance of an Event of
Default, the proceeds of any sale of, or other realization upon, all or any part
of the Collateral and any cash held in the Concentration Account that are to be
applied to the obligations secured hereby in accordance with the priorities
established by the Orders shall be applied by the Collateral Agent, subject to
the Carve-Out, in the following order of priority;
FIRST, to payment of the reasonable expenses (including any
associated fees or commissions) of such sale or other realization,
including reasonable compensation to the Collateral Agent, its agents
and counsel, and all expenses, liabilities and advances incurred or
made by the Collateral Agent in connection therewith, and any other
unreimbursed expenses for which the Collateral Agent or any Secured
Party is to be reimbursed pursuant to Sections 10.05 and 10.06 of the
DIP Credit Agreement or Section 19 hereof and to unpaid fees owing to
the Collateral Agent or the Fronting Banks under the DIP Credit
Agreement;
SECOND, to the ratable payment of unpaid principal of Loans
and, subject to the second sentence of subsection (b) below, Letter of
Credit Obligations;
THIRD, to the ratable payment of accrued but unpaid interest
on the Obligations in accordance with the provisions of the DIP Credit
Agreement;
FOURTH, to the ratable payment of all other Obligations,
until all Obligations shall have been paid in full; and
FINALLY, to payment to each of the Grantors or their
successors or assigns, or as a court of competent jurisdiction may
direct, of any surplus then remaining from such proceeds.
(b) The Collateral Agent may make distributions hereunder in cash
or in kind or, on a ratable basis, in any combination thereof. If at any time
any monies collected or received by the Collateral Agent are distributable
pursuant to this Section in respect of a Letter of Credit Obligation that is a
contingent obligation at such time, then the Collateral Agent shall invest such
amounts in Liquid Investments selected by it and shall hold all such amounts so
distributable and all such Liquid Investments and the net proceeds thereof in
trust for application to the payment of such Letter of Credit Obligation at such
time as such Letter of Credit Obligation is no longer a contingent obligation.
If the Collateral Agent
30
holds any amounts that were distributable in respect of any Letter of Credit
Obligations after all Letters of Credit have expired and all amounts payable
with respect thereto have been paid, such amounts shall be applied in the order
set forth in subsection (a) above. As used herein in this Section 18, "LIQUID
INVESTMENT" means (i) direct obligations of the United States or any agency
thereof, (ii) obligations guaranteed by the United States or any agency thereof,
(iii) time deposits and money market deposit accounts issued by or guaranteed by
or placed with a Secured Party, and (iv) fully collateralized repurchase
agreements for securities described in clause (i) or (ii) above entered into
with a Secured Party, provided in each case that such Liquid Investment (x)
matures within 30 days after it is first included in the Collateral and (y) is
in a form, and is issued and held in a manner, that in the reasonable judgment
of the Collateral Agent permits appropriate measures to have been taken to
perfect security interests therein.
(c) In making the determinations and allocations required by this
Section, the Collateral Agent shall have no liability to any of the Secured
Parties for actions taken in reliance on information supplied by the Secured
Parties as to the amounts of the Obligations held by them. All distributions
made by the Collateral Agent pursuant to this Section shall be final, and the
Collateral Agent shall have no duty to inquire as to the application by any
Secured Party of any amount distributed to them. However, if at any time the
Collateral Agent determines that an allocation or distribution previously made
pursuant to this Section was based on a mistake of fact (including, without
limiting the generality of the foregoing, mistakes based on any assumption that
principal or interest had been paid by payments that were subsequently recovered
from the recipient thereof), the Collateral Agent may in its discretion, but
shall not be obligated to, adjust subsequent allocations and distributions
hereunder so that, on a cumulative basis, the Collateral Agent and the Secured
Parties receive the distributions to which they would have been entitled if such
mistake of fact had not been made.
SECTION 19. Indemnity and Expense.
(a) Each Grantor, jointly and severally, agrees to indemnify each
of the Secured Parties from and against any and all claims, losses and
liabilities growing out of or resulting from this Agreement (including, without
limitation, enforcement of this Agreement) and the agreements attached hereto,
except claims, losses or liabilities directly arising from such Secured Party's
own gross negligence or willful misconduct.
(b) The Grantors will upon demand pay to the Collateral Agent the
amount of any and all reasonable expenses, including the reasonable fees and
disbursements of its counsel and of any experts and agents, that the Collateral
Agent may incur in connection with (i) the administration of this Agreement,
(ii) the custody, preservation, use or operation of, or the sale of, collection
from, or
31
other realization upon, any of the Collateral, (iii) the exercise or enforcement
of any of the rights of the Collateral Agent hereunder or (iv) the failure by
any of the Grantors to perform or observe any of the provisions hereof.
(c) In the event that any of the Grantors fails to comply with the
provisions of the DIP Credit Agreement or this Agreement, such that the value of
any Collateral or the validity, perfection, rank or value of any Security
Interest is thereby diminished or potentially diminished or put at risk, the
Collateral Agent, if requested by the Required DIP Lenders may, but shall not be
required to, effect such compliance on behalf of the Grantors, and the Grantors
shall reimburse the Collateral Agent for the costs thereof on demand. All
insurance expenses and all expenses of protecting, storing, warehousing,
insuring, handling, maintaining, and shipping the Collateral, any and all
excise, property, sales, and use taxes imposed by any state, federal, or local
authority on any of the Collateral, all reasonable costs and expenses in respect
of periodic inspections of the Collateral to the extent the same may be
requested by the Required DIP Lenders from time to time (but not more frequently
than once in each fiscal year of the Grantors unless an Event of Default has
occurred and is continuing), or in respect of the sale or other disposition
thereof, shall be borne and paid by the Grantors; and if each of the Grantors
fails to promptly pay any portion thereof when due, the Collateral Agent or, if
an Event of Default has occurred and is continuing, any Secured Party, may, at
its option, but shall not be required to, pay the same and charge the Grantors'
account therefor, and each of the Grantors agrees to reimburse the Collateral
Agent or such Secured Party therefor on demand. All sums so paid or incurred by
the Collateral Agent or any Secured Party for any of the foregoing and any and
all other sums for which the Grantors may become liable hereunder and all costs
and expenses (including reasonable attorneys' fees, legal expenses and court
costs) reasonably incurred by the Collateral Agent or, if an Event of Default
has occurred and is continuing, any Secured Party, in enforcing or protecting
the Security Interests or any of their rights or remedies under this Agreement,
shall, together with interest thereon from the date of demand for payment until
paid at the rate applicable to ABR Borrowings plus 2.00%, be additional
Obligations hereunder and under the DIP Credit Agreement.
(d) The Grantors assume all responsibility and liability arising
from the use of the Trademarks, Patents and Copyrights, and the Grantors hereby,
jointly and severally, indemnify and hold each of the Secured Parties harmless
from and against any claim, suit, loss, damage or expense (including reasonable
attorneys' fees) arising out of any alleged defect in any product manufactured,
promoted or sold by any of the Grantors in connection with any Trademark or out
of the manufacture, promotion, labeling, sale or advertisement of any such
product by any of the Grantors except as the same may have resulted from the
gross negligence or willful misconduct of such Secured Party.
32
(e) Each of the Grantors agrees that no Secured Party assumes, and
no Secured Party shall have any responsibility for, the payment of any sums due
or to become due under any agreement or contract included in the Collateral or
the performance of any obligations to be performed under or with respect to any
such agreement or contract by any of the Grantors, and except as the same may
have resulted from the gross negligence or willful misconduct of such Secured
Party, each of the Grantors hereby jointly and severally agrees to indemnify and
hold such Secured Party harmless with respect to any and all claims by any
person relating hereto.
SECTION 20. Appointment of Co-Collateral Agents. At any time or
times, in order to comply with any legal requirement in any jurisdiction, the
Collateral Agent may appoint another bank or trust company or one or more other
persons, either to act as co-agent or co-agents, jointly with the Collateral
Agent, or to act as separate agent or agents on behalf of the Secured Parties
with such power and authority as may be necessary for the effectual operation of
the provisions hereof and may be specified in the instrument of appointment
(which may, in the discretion of the Collateral Agent, include provisions for
the protection of such co-agent or separate agent similar to the provisions
relating to the Collateral Agent contained herein).
SECTION 21. Security Interest Absolute. All rights of the Collateral
Agent and security interests hereunder, and all obligations of each of the
Grantors hereunder, shall be absolute and unconditional, irrespective of any
circumstance that might constitute a defense available to, or a discharge of,
any guarantor or other obligor in respect of the Obligations.
SECTION 22. Amendments; Etc. No amendment or waiver of any provision
of this Agreement, nor any consent to any departure by any of the Grantors
herefrom, shall in any event be effective unless the same shall be in writing
and signed by the Grantors and the Collateral Agent with the consent of the
Required DIP Lenders (or, solely in the case of this Section 21 or Section
23(b), with the consent of all the DIP Lenders, and, solely in the case of
Section 23(e), with the consent of the Super-Majority DIP Lenders), and then
such waiver or consent shall be effective only in the specific instance and for
the specific purpose for which given. The Grantors shall be entitled to assume
that the Collateral Agent has obtained the requisite consent of the DIP Lenders
to any such change, waiver, discharge or termination hereunder to which the
Collateral Agent has consented in writing.
SECTION 23. Addresses for Notices. All notices and other
communications provided for hereunder shall be in writing and shall be given as
provided for in the DIP Credit Agreement.
33
SECTION 24. Termination of Security Interests; Release of Collateral.
(a) This Agreement shall create a continuing security interest in
the Collateral.
(b) Upon the payment in full of all Obligations, the termination
of the Commitments under the DIP Credit Agreement and the expiration or
cancellation of all Letters of Credit, the Security Interests shall terminate
and all rights to the Collateral shall revert to the Grantors; provided that, if
no Event of Default has occurred and is continuing and the Grantors grant to the
Collateral Agent, for the benefit of the Secured Parties, a security interest in
Liquid Investments (or cause to be issued by a bank acceptable to the Required
DIP Lenders a letter of credit naming the Collateral Agent as beneficiary) in an
amount exceeding the greater of (A) 105% of the sum of (i) all outstanding
letters of credit and (ii) all payments to beneficiaries of Letters of Credit
that have not yet been remitted by the Borrowers, in each case (plus any accrued
and unpaid interest thereon) as of the date of such termination, and (B) such
other amount as is required under Section 2.03(b) of the DIP Credit Agreement,
all on terms and conditions and pursuant to documentation reasonably
satisfactory to the Required DIP Lenders, the Letters of Credit need not have
expired or been cancelled in order for the Security Interests to terminate.
(c) Upon the consummation of any sale or exchange of Collateral
permitted by clause (i) of Section 7(f), the Security Interests created hereby
in the Collateral subject to such sale or exchange (but not in any proceeds
arising from such sale or exchange) shall cease immediately without any further
action on the part of any Secured Party or the Collateral Agent.
(d) Except as provided otherwise in the DIP Credit Agreement, upon
the consummation of any disposition of assets and the payment of proceeds
therefrom, each as permitted by the terms of the DIP Credit Agreement, the
Collateral Agent shall release the Collateral (but not any proceeds thereof)
sold pursuant to such disposition of assets. Any such release shall not require
the consent of any Secured Party, and the Collateral Agent shall be fully
protected in relying on a certificate of the Grantors as to whether any
particular disposition of assets is permitted by the terms of the DIP Credit
Agreement.
(e) In addition to releases of Collateral effected by subsection
(c) or permitted pursuant to subsection (d), at any time and from time to time
prior to the termination of the Security Interests, the Collateral Agent may
release any of the Collateral with the prior written consent of the Required DIP
Lenders; provided that any release of all or a substantial portion of the
Collateral (for purposes of this proviso, such term shall have the definition
ascribed to it in the DIP Credit Agreement) shall require the consent of the
Super-Majority DIP Lenders.
34
(f) Upon the termination of the Security Interests or any release
of any Collateral permitted by this Section, the Collateral Agent will, at the
expense of the Grantors, execute and deliver to the Grantors such documents as
the Grantors shall reasonably request to evidence the termination of the
Security Interests or the release of such Collateral, as the case may be.
SECTION 25. Governing Law. This Agreement shall be governed by and
construed in accordance with (a) the laws of the State of New York, except as
required by mandatory provisions of law and except to the extent that the
validity or perfection of the security interest hereunder, or remedies
hereunder, in respect of any particular Collateral are governed by the laws of a
jurisdiction other than the State of New York and (b) Federal law (including,
without limitation, the Bankruptcy Code) to the extent the same has pre-empted
the law of the State of New York or such other jurisdiction.
SECTION 26. Headings. Section headings in this Agreement are included
herein for convenience of reference only and shall not constitute a part of this
Agreement for any other purpose.
SECTION 27. Waivers, Non-exclusive Remedies. No failure on the part
of the Collateral Agent to exercise, and no delay in exercising and no course of
dealing with respect to, any right under this Agreement shall operate as a
waiver thereof; nor shall any single or partial exercise by the Collateral Agent
of any right under this Agreement or any other Loan Document preclude any other
or further exercise thereof or the exercise of any other right. The rights in
this Agreement and the other Loan Documents are cumulative and are not exclusive
of any other remedies provided by law.
SECTION 28. Successors and Assigns. This Agreement is for the benefit
of the Collateral Agent and the Secured Parties and their successors and
assigns, and in the event of an assignment of all or any of the Obligations in
accordance with the provisions of the DIP Credit Agreement, the rights
hereunder, to the extent applicable to the indebtedness or obligation so
assigned, shall be deemed transferred with such indebtedness or obligation. This
Agreement shall be binding on and inure to the benefit of the Grantors and their
successors and permitted assigns.
SECTION 29. Severability. If any provision hereof is invalid or
unenforceable in any jurisdiction, then, to the fullest extent permitted by law,
(i) the other provisions hereof shall remain in full force and effect in such
jurisdiction and shall be liberally construed in favor of the Collateral Agent
and the Secured Parties in order to carry out the intentions of the parties
hereto as nearly as may be possible; and (ii) the invalidity or unenforceability
of any
35
provision hereof in any jurisdiction shall not affect the validity or
enforceability of such provision in any other jurisdiction.
36
IN WITNESS WHEREOF, each of the Grantors and the Collateral Agent have
caused this Agreement to be duly executed and delivered by their respective
officers thereunto duly authorized as of the date first above written.
GRANTORS:
LODGIAN, INC.
1075 HOSPITALITY, L.P.
By: Stevens Creek Hospitality, Inc.
as General Partner
12801 NWF BEVERAGE, INC.
ALBANY HOTEL, INC.
AMI OPERATING PARTNERS, L.P.
By: AMIOP Acquisition Corp.,
as General Partner
AMIOP ACQUISITION CORP.
APICO HILLS, INC.
APICO INNS OF GREEN TREE, INC.
APICO INNS OF PENNSYLVANIA, INC.
APICO INNS OF PITTSBURGH, INC.
APICO MANAGEMENT CORP.
ATLANTA-BOSTON SPE, INC.
ATLANTA-BOSTON HOLDINGS LLC
ATLANTA-BOSTON LODGING LLC
ATLANTA-HILLSBORO LODGING, L.L.C.
BRECKSVILLE HOSPITALITY, INC.
BRECKSVILLE HOSPITALITY, L.P.
By: Brecksville Hospitality, Inc.,
as General Partner
BRUNSWICK MOTEL ENTERPRISES, INC.
COLUMBUS HOSPITALITY ASSOCIATES,
LIMITED PARTNERSHIP
By: Servico Columbus, Inc.
as General Partner
DEDHAM BEVERAGE MANAGEMENT, INC.
DEDHAM LODGING ASSOCIATES I,
LIMITED PARTNERSHIP
By: Impac SPE #3, Inc.,
as General Partner
DOTHAN HOSPITALITY 3053, INC.
DOTHAN HOSPITALITY 3071, INC.
EAST WASHINGTON HOSPITALITY
LIMITED PARTNERSHIP
By: Servico East Washington, Inc.,
as General Partner
EUROPEAN VENTURES, INC.
FAYETTEVILLE MOTEL ENTERPRISES, INC.
FORT WAYNE HOSPITALITY
ASSOCIATES II, LIMTED PARTNERSHIP
By: Servico Fort Wayne II, Inc.,
as General Partner
FOURTH STREET HOSPITALITY, INC.
GADSDEN HOSPITALITY, INC.
GREAT SOUTHERN MINING CO., INC.
GROUPERS & COMPANY SEAFOOD
RESTAURANT
HARRISBURG MOTEL ENTERPRISES, INC.
HEARTLANDS GARDEN GRILLE, INC
HILTON HEAD MOTEL ENTERPRISES, INC.
IMPAC DEVELOPMENT AND
CONSTRUCTION L.L.C.
IMPAC HOLDINGS III, L.L.C.
IMPAC HOTEL GROUP, L.L.C.
IMPAC HOTEL MANAGEMENT L.L.C.
IMPAC HOTELS I, L.L.C.
IMPAC SPE #1, INC.
IMPAC SPE #2, INC.
IMPAC SPE #3, INC.
IMPAC SPE #4, INC.
IMPAC SPE #5, INC.
IMPAC SPE #6, INC.
ISLAND MOTEL ENTERPRISES, INC.
KDS CORPORATION
KINSER MOTEL ENTERPRISES, INC.
LAFAYETTE BEVERAGE
MANAGEMENT, INC
LAWRENCE HOSPITALITY
ASSOCIATES, L.P.
By: Servico Lawrence, Inc.,
as General Partner
LITTLE ROCK LODGING ASSOCIATES,
LIMITED PARTNERSHIP
By: Lodgian Richmond SPE, Inc.,
as General Partner
LODGIAN ACQUISITION, LLC.
LODGIAN AMI, INC.
LODGIAN ANAHEIM, INC.
LODGIAN AUSTIN BEVERAGE CORP.
LODGIAN DALLAS BEVERAGE CORP.
LODGIAN FINANCING CORP.
LODGIAN FLORIDA, INC.
LODGIAN HOTELS, INC.
LODGIAN MANAGEMENT CORP.
LODGIAN MARKET CENTER
BEVERAGE CORP.
LODGIAN MOUNT LAUREL, INC.
LODGIAN ONTARIO, INC.
LODGIAN RICHMOND SPE, INC.
LODGIAN RICHMOND, L.L.C.
LODGIAN YORK MARKET STREET, INC.
MANHATTAN HOSPITALITY
ASSOCIATES, L.P.
By: Servico Manhattan, Inc.,
as General Partner
MCKNIGHT MOTEL, INC.
MELBOURNE HOSPITALITY ASSOCIATES,
LIMITED PARTNERSHIP
By: Servico Melbourne, Inc.
as General Partner
MINNEAPOLIS MOTEL ENTERPRISES, INC.
MOON AIRPORT MOTEL, INC.
MULLIGAN'S, INC.
NEW ORLEANS AIRPORT MOTEL
ENTERPRISES, INC.
NH MOTEL ENTERPRISES, INC.
PALM BEACH MOTEL ENTERPRISES, INC.
PENMOCO, INC.
RALEIGH MOTEL ENTERPRISES, INC.
RALEIGH-DOWNTOWN ENTERPRISES, INC.
ROYCE HOLDING CORP.
ROYCE HOTEL CORPORATION
OF DELAWARE
ROYCE MANAGEMENT CORP. OF GEORGIA
SAGINAW HOSPITALITY,
LIMITED PARTNERSHIP
By: Servico Saginaw, Inc.,
as General Partner
SECOND FAYETTEVILLE MOTEL
ENTERPRISES, INC.
SECOND PALM BEACH MOTEL
ENTERPRISES, INC.
SERVICO ACQUISITION CORP.
SERVICO AUSTIN, INC.
SERVICO CEDAR RAPIDS, INC.
SERVICO CENTRE ASSOCIATES, LTD.
By: Palm Beach Motel Enterprises,
as General Partner
SERVICO COLESVILLE, INC.
SERVICO COLUMBIA II, INC.
SERVICO COLUMBIA, INC.
SERVICO COLUMBUS, INC.
SERVICO CONCORD, INC.
SERVICO COUNCIL BLUFFS, INC.
SERVICO EAST WASHINGTON, INC.
SERVICO FLAGSTAFF, INC.
SERVICO FORT WAYNE II, INC.
SERVICO FORT WAYNE, INC.
SERVICO FRISCO, INC.
SERVICO FT. PIERCE, INC.
SERVICO GRAND ISLAND, INC.
SERVICO HILTON HEAD, INC.
SERVICO HOSPITALITY, INC.
SERVICO HOTELS I, INC.
SERVICO HOTELS II, INC.
SERVICO HOTELS III, INC.
SERVICO HOTELS IV, INC.
SERVICO HOUSTON, INC.
SERVICO INVESTMENT COMPANY
OF DELAWARE, INC.
SERVICO JAMESTOWN, INC.
SERVICO LANSING, INC.
SERVICO LAWRENCE II, INC.
SERVICO LAWRENCE, INC.
SERVICO MANAGEMENT CORPORATION
SERVICO MANAGEMENT CORP.
SERVICO MANHATTAN, INC.
SERVICO MANHATTAN II, INC.
SERVICO MARKET CENTER, INC.
SERVICO MARYLAND, INC.
SERVICO MELBOURNE, INC.
SERVICO METAIRIE, INC.
SERVICO NEW YORK, INC.
SERVICO NIAGARA FALLS, INC.
SERVICO NORTHWOODS, INC.
SERVICO OMAHA CENTRAL, INC.
SERVICO OMAHA, INC.
SERVICO OPERATIONS CORPORATION
SERVICO PENSACOLA 7200, INC.
SERVICO PENSACOLA 7330, INC.
SERVICO PENSACOLA, INC.:
SERVICO ROLLING MEADOWS, INC.
SERVICO ROSEVILLE, INC.
SERVICO SAGINAW, INC.
SERVICO SILVER SPRING, INC.
SERVICO SUMMERVILLE, INC.
SERVICO TUCSON, INC.
SERVICO WEST DES MOINES, INC.
SERVICO WEST PALM BEACH, INC.
SERVICO WICHITA, INC.
SERVICO WINDSOR, INC.
SERVICO WINTER HAVEN, INC.
SERVICO WORCESTER, INC.
SERVICO, INC.
SHARON MOTEL ENTERPRISES, INC.
SHC OF DELAWARE, INC.
SHEFFIELD MOTEL ENTERPRISES, INC.
SIOUX CITY HOSPITALITY, L.P.
By: Fourth Street Hospitality, Inc.,
as General Partner
SIXTEEN HOTELS, INC.
STEVENS CREEK HOSPITALITY, INC..
W.V.B.M., INC.
WASHINGTON MOTEL ENTERPRISES, INC.
WILPEN, INC.
WORCESTER HOSPITALITY ASSOCIATES,
LIMITED PARTNERSHIP
By: Servico Worcester, Inc.,
as General Partner
By: /s/ Daniel E. Ellis
-------------------------------
Title: Vice President
COLLATERAL AGENT:
MORGAN STANLEY
SENIOR FUNDING, INC.
as Collateral Agent
By: /s/ Stephen Hannan
-------------------------------
Title: Vice President
EXHIBIT A
TRADEMARK SECURITY AGREEMENT
(TRADEMARKS, TRADEMARK REGISTRATIONS, TRADEMARK
APPLICATIONS AND TRADEMARK LICENSES)
WHEREAS, [NAME OF GRANTOR], a [corporation] (together with any
successors thereto, the "GRANTOR") owns, or in the case of licenses, is a
party to, the Trademark Collateral (as defined below);
WHEREAS, Grantor, as a [Borrower] [Guarantor], the [other] Borrower[s]
party thereto, the other Guarantors party thereto, the Lenders party thereto
(the "DIP LENDERS"), and Morgan Stanley Senior Funding, Inc. as Administrative
Agent are parties to a Revolving Credit and Guaranty Agreement dated as of
December 31, 2001 (as the same may be amended from time to time, the "DIP
CREDIT AGREEMENT");
WHEREAS, pursuant to the terms of a Security and Pledge Agreement dated
as of December 31, 2001 (as such agreement may be further amended from time to
time, the "DIP SECURITY AGREEMENT") among Grantor, the other lien grantors
party thereto and Morgan Stanley Senior Funding, Inc., as Collateral Agent for
the Secured Parties (as defined in the DIP Security Agreement) (in such
capacity, together with its successors in such capacity, "GRANTEE"), Grantor
has granted to Grantee for the benefit of the Secured Parties a continuing
security interest in substantially all the assets of Grantor, including all
right, title and interest of Grantor in, to and under the Trademark Collateral
(as defined herein), whether now owned or existing or hereafter acquired or
arising, to secure the Obligations (as defined in the DIP Credit Agreement);
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, Grantor does hereby grant to
Grantee, to secure the Obligations, a continuing security interest in all of
Grantor's right, title and interest in, to and under the following (all of the
following items or types of property being herein collectively referred to as
the "TRADEMARK COLLATERAL"), whether now owned or existing or hereafter
acquired or arising:
(i) each Trademark (as defined in the DIP Security
Agreement) owned by Grantor, including, without limitation, each
Trademark registration and application referred to in Schedule A-1
hereto, and all of the goodwill of the business connected with the use
of, or symbolized by, each Trademark;
(ii) each Trademark License (as defined in the DIP
Security Agreement), including, without limitation, each Trademark
License identified in Schedule A-1 hereto, and all of the goodwill of
the business connected with the use of, or symbolized by, each
Trademark licensed pursuant thereto; and
(iii) all proceeds of and revenues from the foregoing,
including, without limitation, all proceeds of and revenues from any
claim by Grantor against third parties for past, present or future
unfair competition with, or violation of intellectual property rights
in connection with or injury to, or infringement or dilution of, any
Trademark owned by Grantor, including, without limitation, any
Trademark referred to in Schedule A-1 hereto, and all rights and
benefits of Grantor under any Trademark License, including, without
limitation, any Trademark License identified in Schedule A-1 hereto, or
for injury to the goodwill associated with any of the foregoing.
Grantor hereby irrevocably constitutes and appoints Grantee and any
officer or agent thereof, with full power of substitution, as its true and
lawful attorney-in-fact with full power and authority in the name of Grantor or
in its name, from time to time, in Grantee's discretion, so long as any Event of
Default (as defined in the DIP Credit Agreement) has occurred and is continuing,
to take with respect to the Trademark Collateral any and all appropriate action
which Grantor might take with respect to the Trademark Collateral and to execute
any and all documents and instruments which may be necessary or desirable to
carry out the terms of this Trademark Security Agreement and to accomplish the
purposes hereof.
Except to the extent permitted in the DIP Credit Agreement, Grantor
agrees not to sell, license, exchange, assign or otherwise transfer or dispose
of, or grant any rights with respect to, or mortgage or otherwise encumber, any
of the foregoing Trademark Collateral.
The foregoing security interest is granted in conjunction with the
security interests granted to Grantee pursuant to the DIP Security Agreement.
Grantor does hereby further acknowledge and affirm that the rights and remedies
of Grantee with respect to the security interest in the Trademark Collateral
granted hereby are more fully set forth in the DIP Security Agreement, the terms
and provisions of which are incorporated by reference herein as if fully set
forth herein.
IN WITNESS WHEREOF, Grantor has caused this Trademark Security
Agreement to be duly executed by its officer thereunto duly authorized as of the
_____ day of _______________, 200__.
[NAME OF GRANTOR]
By:
------------------------------
Title:
Acknowledged:
By:
--------------------------
Title:
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
I, ___________________, a Notary Public in and for said County, in the
State aforesaid, DO HEREBY CERTIFY, that __________________, ________________ of
[NAME OF GRANTOR], personally known to me to be the same person whose name is
subscribed to the foregoing instrument as such __________________, appeared
before me this day in person and acknowledged that (s)he signed, executed and
delivered the said instrument as her/his own free and voluntary act and as the
free and voluntary act of said Company, for the uses and purposes therein set
forth being duly authorized so to do.
GIVEN under my hand and Notarial Seal this _______ day of
______________________, 200__.
[Seal]
- --------------------------------
Signature of notary public
My Commission expires
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