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FIRST MODIFICATION OF FIRST AMENDED REVOLVING
CREDIT AND TERM LOAN AGREEMENT AND
OF RELATED LOAN DOCUMENTS
(Increase from $50 to $75 Million)
THIS FIRST MODIFICATION OF FIRST AMENDED REVOLVING CREDIT
AND TERM LOAN AGREEMENT AND OF RELATED LOAN DOCUMENTS
("Agreement") dated as of the 29th day of May, 1996, entered into by and
between RFS HOTEL INVESTORS, INC., a Tennessee corporation ("Borrower"); RFS
PARTNERSHIP, L.P., a Tennessee limited partnership ("RFSP"); and BOATMEN'S BANK
OF TENNESSEE, a Tennessee banking corporation ("Bank") on behalf of itself as
well as all Participants.
RECITALS
A. Borrower, RFSP and Bank have previously entered into that certain
FIRST AMENDED REVOLVING CREDIT AND TERM LOAN AGREEMENT dated as of February 20,
1996 (the "Loan Agreement") setting forth the terms and conditions of that
certain Revolving Credit Loan, as therein defined, in an amount not to exceed
the maximum principal sum of Fifty Million and No/100 Dollars ($50,000,000.00).
B. The indebtedness of Borrower to Bank is secured by various Hotel
Properties, as defined in the Loan Agreement, by the Collateral, as defined in
the Loan Agreement, by the Assignments of Rents and Leases, as defined in the
Loan Agreement, and by certain other property heretofore, or hereafter, pledged
as collateral security for the indebtedness of Borrower to Bank, all of which
may hereinafter sometimes be collectively referred to as the "Collateral."
C. Borrower has asked Bank to increase the Revolving Credit Loan to
Seventy-Five Million and No/100 Dollars ($75,000,000.00), and Bank has agreed to
do so, contingent on the agreement of the Participants to fund their respective
Percentage Interests (as defined in the Loan Agreement) thereof, it being
understood and agreed that Bank's obligation to lend is limited to the maximum
amount of Twenty Five Million and No/100 Dollars ($25,000,000.00) in the event
any Participants fail to fund to Bank their portions of advances requested by
Borrower under the Revolving Credit Loan.
NOW, THEREFORE, in consideration of the premises and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties do hereby agree as follows:
1. All recitals set forth above are true and correct statements of
fact.
2. All capitalized terms not defined herein shall have the meaning
assigned to such terms in the Loan Agreement.
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3. Contingent upon the Participants agreeing to fund their respective
Percentage Interests of the increase in the amount of the Revolving Credit Loan,
the maximum principal amount of the Revolving Credit Loan is hereby increased
from Fifty Million and No/100 Dollars ($50,000,000.00) to Seventy-Five Million
and No/100 Dollars ($75,000,000.00). Wherever in the Loan Agreement reference is
made to the aggregate principal amount or maximum amount of the Revolving Credit
Loan, it is hereby understood and agreed that such terms shall refer to the
increased sum of Seventy-Five Million and No/100 Dollars ($75,000,000.00). All
other Loan Documents are also hereby modified to the extent necessary so that
wherever therein reference is made to the amount of the Revolving Credit Loan,
such amount shall hereafter be Seventy-Five Million and No/100 Dollars
($75,000,000.00).
4. The Revolving Credit Note shall be replaced with a replacement note
in the principal amount of Seventy-Five Million and No/100 Dollars
($75,000,000.00). Thereafter, the Revolving Credit Loan and advances thereunder
shall be evidenced by, and repaid with interest in accordance with, such
replacement note.
5. Borrower shall pay to Bank a prorated commitment fee and agent's fee
on the date hereof, both of which shall be equal to the prorated percentage of
the number of days remaining in the year commencing with such date divided by
Three Hundred Sixty (360), times one-quarter percent (.25%) of the increase in
the maximum amount of the Revolving Credit Loan of Twenty- Five Million and
No/100 Dollars ($25,000,000.00).
6. Section 2.09 of the Loan Agreement is hereby amended to substitute
the sum of Two Hundred Twenty-Seven Million Two Hundred Seventy-Three Thousand
and No/100 Dollars ($227,273,000.00) in the place and stead of One Hundred
Fifty-One Million Five Hundred Thousand and No/100 Dollars ($151,500,000.00).
7. Section 5.09(b) of the Loan Agreement presently requires Borrower to
maintain a minimum level of Operating Income from Collateral Pool Properties at
all times of at least Seventeen Million Five Hundred Thousand and No/100 Dollars
($17,500,000.00). Commencing with the effective date hereof, Borrower must
maintain a minimum level of Operating Income from Collateral Pool Properties at
all times of at least Twenty-Six Million Two Hundred Fifty Thousand and No/100
Dollars ($26,250,000.00).
8. Borrower understands that the Participants must agree to increase
their respective Percentage Interests in the Revolving Credit Loan, and that
Bank must locate another lending institution which will agree to purchase an
undivided interest in the Revolving Credit Loan for such sum as when added to
Bank's and the remaining Participants' Percentage Interests, as amended, will
total one hundred percent (100%) of the Revolving Credit Loan, in order for Bank
to be able to fund Borrower's requested increase therein. Borrower also hereby
acknowledges that Bank shall be entering into certain modifications or
agreements with the Participants to fund to Bank their respective Percentage
Interests of the increase in the Revolving Credit Loan. It is expressly
understood and agreed that if, for any reason, any of said Participants should
fail
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or refuse to fund its Percentage Interest of the Revolving Credit Loan, neither
Bank nor any of the other Participants shall have any liability or obligation to
Borrower to fund such unfunded portion of the Loan, all as more fully provided
in Section 8.16 of the Loan Agreement.
9. Borrower and RFSP hereby ratify and affirm all terms and provisions
of the Loan Agreement and other Documents, and their obligations thereunder, as
modified hereby, without any objection or defense to the enforcement thereof by
Bank in accordance with the terms and provisions thereof.
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed as of the date first above written.
"BORROWER":
RFS HOTEL INVESTORS, INC.
BY: /s/
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TITLE:
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"RFSP"
RFS PARTNERSHIP, L.P.
BY: RFS HOTEL INVESTORS, INC.
ITS GENERAL PARTNER
BY: /s/
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TITLE:
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"BANK"
BOATMEN'S BANK OF TENNESSEE
BY: /s/
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TITLE:
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