Exhibit 10.2
AMENDMENT NO. 1 TO TERM LOAN AGREEMENT
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This AMENDMENT NO. 1 TO TERM LOAN AGREEMENT (this "Amendment No. 1") is
made as of June 20, 2005 by and among (a) Reckson Operating Partnership, L.P.
(the "Borrower"), (b) the Lenders party hereto, and (c) Citicorp North
America, Inc., as Administrative Agent (in such capacity, the "Administrative
Agent") for the Lenders.
WHEREAS, the Borrower, the Lenders and the Administrative Agent are
parties to a Term Loan Agreement dated as of May 12, 2005 (the "Term Loan
Agreement"), pursuant to which the Lenders agreed to make a loan to the
Borrower on the terms and conditions set forth therein;
WHEREAS, the Borrower has requested that the Lenders amend certain
provisions of the Term Loan Agreement, and the Lenders party hereto are
willing to so amend certain provisions of the Term Loan Agreement on the terms
and conditions set forth herein;
NOW, THEREFORE, in consideration of the foregoing premises, and for
other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, and fully intending to be legally bound by this
Amendment No. 1, the parties hereto agree as follows:
1. Definitions. Capitalized terms used herein without definition shall
have the meanings assigned to such terms in the Term Loan Agreement.
2. Amendments to Term Loan Agreement. As of the Effective Date (as
defined in ss.4 hereof) the Term Loan Agreement is amended as follows:
2.1. Amendments to Section 1.1. Section 1.1. is hereby amended as
follows:
2.1.1. The definition of the term "Adjusted Unencumbered NOI"
is hereby amended by restating the proviso at the end of such
definition to read as follows:
"provided, clause (ii) above shall not exceed twenty percent
(20%) of Adjusted Unencumbered NOI; clause (iii) above shall not
exceed ten percent (10%) of Adjusted Unencumbered NOI; and clause
(iv) above shall not exceed fifteen percent (15%) of Adjusted
Unencumbered NOI."
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2.1.2. The definition of the term "Applicable Margin" is
hereby amended by deleting the table set forth therein in its
entirety and substituting the following table in place thereof:
Range of Applicable
the Borrower's Applicable Margin for
Credit Rating Margin for Euro Base Rate
(S&P/Xxxxx'x Dollar Loans Loans
or other Ratings) (% per annum) (% per annum)
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A-/A3 or their equivalent or 0.50 0
higher
BBB+/Baa1 or their equivalent 0.525 0
BBB/Baa2 or their equivalent 0.60 0
BBB-/Baa3 or their equivalent 0.80 0
Below BBB-/Baa3 or their 1.10 0
equivalent or unrated
2.1.3. The definition of the term "Capital Expenditure
Coverage Reserve Amounts" is hereby amended by inserting the words
"; provided that all properties that are subject to a Triple Net
Lease shall be excluded from the foregoing calculation of the
Capital Expenditure Coverage Reserve Amounts" at the end of such
definition after the word "Assets".
2.1.4. The definition of the term "Capital Expenditure
Valuation Reserve Amounts" is hereby amended by inserting the words
"; provided that all properties that are subject to a Triple Net
Lease shall be excluded from the foregoing calculation of the
Capital Expenditure Valuation Reserve Amounts" at the end of such
definition after the word "Assets".
2.1.5. The definition of the term "Indebtedness" is hereby
amended by inserting the words ", other than any undrawn letter of
credit to the extent that such letter of credit supports any
Contractual Obligation with a term of less than ninety (90) days,"
at the end of clause (a)(iii) of such definition.
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2.1.6. The definition of the term "New York City Asset" is
hereby amended and restated in its entirety as follows:
""New York City Asset" means (i) Real Property which is Class
A office property located in the borough of Manhattan, New York,
New York or (ii) Real Property which is Class A office property
located in any other borough of New York, New York and is
substantially similar to Class A office properties located in the
borough of Manhattan, New York, New York, and in each case which is
owned or ground-leased by one of the Consolidated Businesses or
Joint Ventures."
2.1.7. The definition of the term "Total Unencumbered Value"
is hereby amended by restating the second sentence of the second
paragraph of such definition to read as follows:
"Clause (iii) shall not exceed ten percent (10%) of Total
Unencumbered Value."
2.1.8. The definition of the term "Total Value" is hereby
amended and restated in its entirety as follows:
""Total Value" means (a) the sum of (i) Valuation NOI divided
by (A) seven and one-half percent (7.50%) for all New York City
Assets, (B) eight and three-quarter percent (8.75%) for all other
office Real Property, and (C) nine percent (9.00%) for industrial
Real Property; (ii) the Investment in office and industrial
Projects owned or ground-leased by the Consolidated Businesses for
less than four fiscal quarters; (iii) unrestricted Cash and Cash
Equivalents; (iv) land cost (at book value) and Construction Asset
Cost, which credit will be limited to fifteen percent (15%) of
Total Value (exclusive of build-to-suit Projects that are
seventy-five percent (75%) pre-leased or Projects which are less
than seventy-five percent (75%) pre-leased but have a pro-forma
yield of ten percent (10%) or more, based upon executed leases and
the cost of acquisition plus the estimated cost to complete the
same, which estimated cost to complete shall be determined in a
manner reasonably acceptable to the Administrative Agent and the
Syndication Agent); (v) NOI from all other Real Property not
otherwise set forth in this definition, divided by twelve percent
(12%); (vi) Servicing EBITDA of the Management Company or other
such service companies for the immediately preceding four (4)
consecutive quarters, divided by twenty percent (20%); (vii) any
investment in or loan to (based on the actual cash investment in or
loan to), directly or indirectly, an affiliated or unaffiliated
operating company and investments in or loans to Investment Funds
either directly or
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indirectly or joint venture arrangements with Investment Funds,
which credit will be limited to $100,000,000 (valued at the lower
of cost or market in accordance with GAAP), other than (x)
investments in, loans to, or joint venture arrangements with Joint
Ventures and (y) Performing Notes; (viii) Performing Notes, which
credit will be limited in the aggregate to fifteen percent (15%) of
Total Value; and (ix) Eligible Cash 1031 Proceeds;
less (b) the quotient of the Capital Expenditure Valuation
Reserve Amounts for such period, divided by (A) seven and one-half
percent (7.50%) for all New York City Assets, (B) eight and
three-quarter percent (8.75%) for all other office Property, and
(C) nine percent (9.00%) for industrial Property;
provided, the sum of items (a) (iv), (vii) and (viii) above
shall not exceed twenty-five percent (25%) of Total Value."
2.1.9. The following new definitions shall be inserted in
Section 1.1. in proper alphabetical order:
""Triple Net Lease" means a Lease representing all or
substantially all of the rentable area of a Property where the
tenant is responsible for real estate taxes and assessments,
repairs and maintenance, insurance and other expenses relating to
such Property provided, that adequate insurance is maintained for
such Property either by the tenant, the Borrower, the Company, a
Subsidiary or a Joint Venture."
2.2. Amendments to Section 10.11.
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2.2.1. Section 10.11(a) is hereby amended by restating such
Section 10.11(a) in its entirety to read as follows:
"(a) Indebtedness. Neither the Borrower nor any of its
Subsidiaries shall directly or indirectly create, incur, assume or
otherwise become or remain directly or indirectly liable with
respect to ("Incur") any Indebtedness, except:
(i) Total Outstanding Indebtedness which would not exceed
sixty percent (60%) of Total Value as of the date of
incurrence; provided that if the Borrower or its Subsidiaries
shall have Incurred any Indebtedness in connection with the
acquisition of any material Real Property during the previous
120 days, the Borrower or its Subsidiaries may Incur
Indebtedness (the "Incurrence") that would cause Total
Outstanding Indebtedness to exceed sixty percent (60%) of
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Total Value so long as (x) Total Outstanding Indebtedness does
not exceed sixty-five percent (65%) of Total Value and (y)
Total Outstanding Indebtedness is reduced to sixty percent
(60%) or less of Total Value within 240 days after the date of
the Incurrence (with such reduction to be certified in writing
to the Administrative Agent by the Borrower);
(ii) Total Secured Outstanding Indebtedness which would
not exceed forty percent (40%) of Total Value as of the date
of incurrence, or
(iii) Total Recourse Secured Outstanding Indebtedness
which would not exceed ten percent (10%) of Total Value as of
the date of incurrence."
2.2.2. Section 10.11(b) is hereby amended by deleting the
words "the date hereof" at the end of such Section 10.11(b) and
replacing such words with the date "June 20, 2005".
3. Provisions Of General Application.
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3.1. Representations and Warranties. The Borrower hereby represents
and warrants as of the date hereof that (a) each of the representations
and warranties of the Borrower contained in the Term Loan Agreement, the
other Loan Documents or in any document or instrument delivered pursuant
to or in connection with the Term Loan Agreement or this Amendment No. 1
are true and correct in all material respects as of the date as of which
they were made and are true and correct in all material respects at and
as of the date of this Amendment No. 1 (except to the extent that such
representations and warranties expressly speak as of a different date),
(b) no Potential Event of Default or Event of Default exists on the date
hereof, and (c) this Amendment No. 1 has been duly authorized, executed
and delivered by the Borrower and is in full force and effect as of the
Effective Date, and the agreements and obligations of the Borrower
contained herein constitute the legal, valid and binding obligations of
the Borrower, enforceable against it in accordance with its terms,
except to the extent that the enforcement hereof or the availability of
equitable remedies may be limited by applicable bankruptcy,
reorganization, insolvency, moratorium, fraudulent transfer, fraudulent
conveyance or similar laws now or hereafter in effect relating to or
affecting creditors' rights generally or by general principles of
equity, or by the discretion of any court in awarding equitable
remedies, regardless of whether such enforcement is considered in a
preceding in equity or at law.
3.2. No Other Changes. Except as otherwise expressly provided or
contemplated by this Amendment No. 1, all of the terms, conditions and
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provisions of the Term Loan Agreement remain unaltered and in full force
and effect. The Term Loan Agreement and this Amendment No. 1 shall be
read and construed as one agreement. The making of the amendments in
this Amendment No. 1 does not imply any obligation or agreement by the
Administrative Agent or any Lender to make any other amendment, waiver,
modification or consent as to any matter on any subsequent occasion.
3.3. Governing Law. This Amendment No. 1 shall be deemed to be a
contract under the laws of the State of New York. This Amendment No. 1
and the rights and obligations of each of the parties hereto are
contracts under the laws of the State of New York and shall for all
purposes be construed in accordance with and governed by the laws of
such State (excluding the laws applicable to conflicts or choice of
law).
3.4. Assignment. This Amendment No. 1 shall be binding upon and
inure to the benefit of each of the parties hereto and their respective
permitted successors and assigns.
3.5. Counterparts. This Amendment No. 1 may be executed in any
number of counterparts, but all such counterparts shall together
constitute but one and the same agreement. In making proof of this
Amendment No. 1, it shall not be necessary to produce or account for
more than one counterpart thereof signed by each of the parties hereto.
4. Effectiveness of this Amendment No. 1. This Amendment No. 1 shall
become effective on the date on which the following conditions precedent are
satisfied (such date being hereinafter referred to as the "Effective Date"):
(a) Execution and delivery to the Administrative Agent by each of
the Lenders, the Borrower, the Guarantors and the Administrative Agent
of this Amendment No. 1.
(b) Execution and delivery to the Administrative Agent of (i) a
certificate of the Borrower confirming that there have been no changes
to its charter documents since May 12, 2005, or (ii) if there have been
changes to the Borrower's charter document since such date, a
secretary's certificate of the Borrower certifying as to such changes.
(c) Delivery to the Administrative Agent of an incumbency
certificate of the Borrower and of resolutions of the board of directors
of the general partner of the Borrower authorizing this Amendment No. 1.
(d) Payment to the Administrative Agent, for the accounts of the
Agents and the Lenders, as applicable, all fees due and payable on or
before the Effective Date and all expenses due and payable on or before
the Effective Date, including, without limitation, reasonable attorneys'
fees and expenses
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and other costs and expenses incurred in connection with this Amendment
No. 1.
(e) Delivery to the Administrative Agent by Fried Xxxxx Xxxxxx
Xxxxxxx & Xxxxxxxx LLP, as counsel to the Borrower, of an opinion
addressed to the Lenders and the Administrative Agent in form and
substance reasonably satisfactory to the Administrative Agent.
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IN WITNESS WHEREOF, the undersigned have duly executed and delivered
this Amendment No. 1 as of the date first set forth above.
RECKSON OPERATING PARTNERSHIP, L.P.
By: Reckson Associates Realty Corp.,
its general partner
By: /s/ Xxxxxxx Xxxxxx
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Name: Xxxxxxx Xxxxxx
Title: Chief Financial Officer
CITICORP NORTH AMERICA, INC.,
as Administrative Agent and as Lender
By: /s/ Xxxxxx X. Xxxxx
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Name: Xxxxxx X. Xxxxx
Title: Vice President
Each of the undersigned Guarantors hereby acknowledges the foregoing Amendment
No. 1 and reaffirms its guaranty of the Guaranteed Obligations (as defined in
the Guaranty executed and delivered by such Guarantor) under the Credit
Agreement and the other Loan Documents, each as amended hereby or in
connection herewith, in accordance with the Guaranty executed and delivered by
such Guarantor.
RECKSON ASSOCIATES REALTY CORP.
By: /s/ Xxxxxxx Xxxxxx
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Name: Xxxxxxx Xxxxxx
Title: Chief Financial Officer
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