AMENDMENT NO. 2 TO CREDIT AGREEMENT
AMENDMENT NO. 2 TO CREDIT AGREEMENT (this "Second Amendment'), dated as
of May 31, 1996, among TANGER PROPERTIES LIMITED PARTNERSHIP, a North Carolina
limited partnership, as the Borrower (the "Borrower"), TANGER FACTORY OUTLET
CENTERS, INC., a North Carolina corporation and the sole general partner of the
Borrower (the "General Partner"), NATIONAL WESTMINSTER BANK Plc., a bank
organized under the laws of England, acting through its New York branch, as the
Agent and Issuing Bank, and NATIONAL WESTMINSTER BANK Plc., a bank organized
under the laws of England, acting through its New York and Nassau branches, and
the other Lenders listed on Exhibit A attached to the Original Agreement
(defined below) as amended from time to time (collectively, the "Lenders").
Unless otherwise defined herein, capitalized terms used in this Second Amendment
shall have the meanings assigned to those terms in the Agreement.
W I T N E S S E T H
WHEREAS, the parties have entered into that certain Credit Agreement,
dated as of January 15, 1996 (the "Original Agreement") as amended by that
certain Amendment No. 1 to Credit Agreement, dated as of February 20, 1996 (the
"First Amendment;" and together with the Original Agreement referred to herein
as the "Agreement");
WHEREAS, the parties hereto desire to amend the Agreement to revise the
covenants contained therein, all on the terms set forth herein;
NOW, THEREFORE, the parties hereto agree as follows:
ARTICLE I
Amendment
Section 1.1 The following definitions are added to Section 1.1 of the
Agreement:
"Annual Service Charge" as of any date means the
amount which is expensed or capitalized in the
immediately preceding four fiscal quarter period for
interest on Indebtedness, excluding amounts relating
to the amortization of deferred financing costs.
"Consolidated Income Available for Debt Service" for
any period means the Consolidated Net Income of the
Borrower and its Subsidiaries (i) plus amounts which
have been deducted for (a) interest on Indebtedness
of the Borrower and its Subsidiaries, (b) provision
for taxes of the Borrower and it Subsidiaries, (c)
amortization of debt discount, (d) depreciation and
amortization, (e) the effect of any noncash charge
resulting from a change in accounting principles in
determining Consolidated Net Income for such period,
(f) amortization of deferred charges, and (g)
provisions for or realized losses on Properties and
(ii) less amounts which have been included for gains
on Properties.
"Consolidated Net Income" for any period means the
amount of consolidated net income (or loss) of the
Borrower and its Subsidiaries for such period
determined on a consolidated basis in accordance with
GAAP.
"Net Cash Proceeds" means the proceeds of any
issuance or sale of Capital Stock or options,
warrants or rights to purchase Capital Stock, in the
form of cash or cash equivalents, including payments
in respect of deferred payment obligations when
received in the form of, or stock or other assets
when disposed
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for, cash or cash equivalents (except
to the extent that such obligations are financed or
sold with recourse to the Borrower or any
Subsidiary), net of attorney's fees, accountant's
fees and brokerage, consultation, underwriting and
other fees and expenses actually incurred in
connection with such issuance or sale and net of
taxes paid or payable as a result thereof.
"Permitted Indebtedness" means Indebtedness of the
Borrower, the General Partner or any Subsidiary owing
to any Subsidiary, the General Partner or the
Borrower pursuant to an intercompany note, provided
that such Indebtedness is expressly subordinated in
right of payment to the Agreement; PROVIDED FURTHER
that any disposition, pledge or transfer of such
Indebtedness to a Person (other than the Borrower or
another Subsidiary) shall be deemed to be an
incurrence of such Indebtedness by the Borrower, the
General Partner or a Subsidiary, as the case may be,
and not be Permitted Indebtedness as defined herein.
"Secured Indebtedness" means any Indebtedness secured
by any mortgage, pledge, lien, charge, encumbrance or
security interest of any kind upon any Properties of
the Borrower or any Subsidiary.
"Total Assets" as of any date means the sum of (i)
the Undepreciated Real Estate Assets and (ii) all
other assets of the Borrower and its Subsidiaries on
a consolidated basis determined in accordance with
GAAP (but excluding intangibles and accounts
receivable).
"Undepreciated Real Estate Assets" as of any date
means the cost (original cost plus capital
improvements) of real estate assets of the Borrower
and its Subsidiaries on such date, before
depreciation and amortization, determined on a
consolidated basis in accordance with GAAP.
To the extent, if any, terms defined in the Agreement
are inconsistent with the definitions set forth
above, the definitions set forth above shall control.
Section 1.2 Section 5.3 (b) of the Agreement is hereby deleted and
replaced in its entirety by the following:
(b) Limitations on Incurrence of Indebtedness.
(i) Create, incur, assume or suffer to exist any
Indebtedness, other than Permitted Indebtedness,
if, immediately after giving effect to the
incurrence of such additional Indebtedness, the
aggregate principal amount of all outstanding
Indebtedness of the Borrower, the General
Partner and its Subsidiaries on a consolidated
basis determined in accordance with GAAP is
greater than 60% of the sum of (i) Total Assets
as of the end of the calendar quarter covered in
the Borrower's Annual Report on Form 10-K or
Quarterly Report on Form 10-Q, as the case may
be, most recently filed with the SEC prior to
the incurrence of such additional Indebtedness
and (ii) any increase in Total Assets since the
end of such quarter, including, without
limitation, any increase in Total Assets
resulting from the incurrence of such additional
Indebtedness (such increase together with the
Total Assets being referred to as the "Adjusted
Total Assets').
(ii) Create, incur, assume or suffer to exist
any Indebtedness if, for the period consisting
of the four consecutive fiscal quarters most
recently
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ended prior to the date on which such
additional Indebtedness is to be incurred, the
ratio of Consolidated Income Available for Debt
Service to the Annual Service Charge shall have
been less than 2.0 to 1, on a pro forma basis
after giving effect to the incurrence of such
Indebtedness and to the application of the
proceeds therefrom, and calculated on the
assumption that (i) such Indebtedness and any
other Indebtedness incurred by the Borrower, the
General Partner or its Subsidiaries since the
first day of such four-quarter period and the
application of the proceeds therefrom, including
to refinance other Indebtedness, had occurred at
the beginning of such period, (ii) the repayment
or retirement of any other Indebtedness by the
Borrower, the General Partner or its
Subsidiaries since the first day of such
four-quarter period had been incurred, repaid or
retired at the beginning of such period (except
that, in making such computation, the amount of
Indebtedness under any revolving credit facility
shall be computed based upon the average daily
balance of such Indebtedness during such
period), (iii) any income earned as a result of
any increase in Adjusted Total Assets since the
end of such four-quarter period had been earned,
on an annualized basis, during such period, and
(iv) in the case of an acquisition or
disposition by the Borrower, the General Partner
or any Subsidiary of any asset or group of
assets since the first day of such four-quarter
period, including, without limitation, by
merger, stock purchase or sale, or asset
purchase or sale, such acquisition or
disposition or any related repayment of
Indebtedness had occurred as of the first day of
such period with the appropriate adjustments
with respect to such acquisition or disposition
being included in such pro forma calculation.
(iii)In addition to the other limitation set forth
in this Section 5.3 (b), create, incur, assume
or suffer to exist any Secured Indebtedness,
whether owned at the date hereof or hereafter
acquired, if, immediately after giving effect
to the incurrence of such additional Secured
Indebtedness, the aggregate principal amount of
all outstanding Secured Indebtedness of the
Borrower, the General Partner and its
Subsidiaries on a consolidated basis is greater
than 40% of the Adjusted Total Assets.
(iv) For the purposes of this Section 5.3(b),
Indebtedness shall be deemed to be "incurred"
by the Borrower, the General Partner or its
Subsidiaries on a consolidated basis whenever
the Borrower, the General Partner and its
Subsidiaries on a consolidated basis shall
create, assume, guarantee or otherwise become
liable in respect thereof.
Section 1.3 Section 5.3 (c) of the Agreement is hereby deleted
in its entirety.
Section 1.4 Section 5.3 (e) of the Agreement is hereby deleted
and replaced in its entirety by the following:
(e) Restriction on Dividends and Other Distributions.
Make any distribution, by reduction of capital or
otherwise (other than distributions payable in
securities evidencing interests in the Borrower's
capital for the purposes of acquiring interests in
real property or otherwise) unless, immediately after
giving pro forma effect to such distribution, (a) no
default hereunder or event of default hereunder or
under any mortgage, indenture or instrument under
which there may be issued, or by which there may be
secured
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or evidenced, any Indebtedness of the Borrower, the
General Partner or any Subsidiary shall have occurred
and be continuing and (b) the aggregate sum of all
distributions made after the date hereof shall not
exceed the sum of (i) 95% of the aggregate cumulative
Funds from Operations of the Borrower accrued on a
cumulative basis from the date hereof until the end
of the last fiscal quarter prior to the contemplated
payment, and (ii) the aggregate Net Cash Proceeds
received by the Borrower after the date hereof from
the issuance and sale of Capital Stock of the
Borrower, the General Partner or any Subsidiary to
the extent such proceeds are contributed to the
Borrower; provided, however, that the foregoing
limitation shall not apply to any distribution or
other action which is necessary to maintain the
General Partner's status as a REIT under the Code, if
the aggregate principal amount of all outstanding
Indebtedness of the General Partner and the Borrower
on a consolidated basis at such time is less than 60%
of Adjusted Total Assets.
Notwithstanding the foregoing, the Borrower will not
be prohibited from making the payment of any
distribution within 30 days of the declaration
thereof if at such date of declaration such payment
would have complied with the provisions of the
immediately preceding paragraph.
Section 1.5 Except as expressly set forth herein, all terms, conditions
and provisions of the Agreement shall remain unchanged and in full force and
effect and are ratified and reaffirmed in all respects.
ARTICLE II
Miscellaneous
Section 2.1 This Second Amendment may be executed in any number of
counterparts and by the different parties hereto on separate counterparts, each
of which when executed and delivered shall be an original, but all of which
shall together constitute one and the same instrument.
Section 2.2 This Second Agreement and the Agreement and the other Loan
Documents constitute the entire agreement of the parties with respect to the
subject matter hereof and thereof, and all prior discussions, negotiations, term
sheets, commitment letters, agreements, correspondence and document drafts with
respect to such matters are merged herein and therein. Neither the Lenders nor
any employee of the Lenders has been authorized to make any representation or
agreement upon which the Borrower or General Partner or their respective
Affiliates may rely unless such matter is set forth in this Second Agreement or
the other Loan Documents.
Section 2.3 The Borrower hereby agrees to, promptly upon the request of
the Lenders, execute and deliver to the Lenders such additional documents and to
provide such additional information as the lenders may reasonably require to
carry out or confirm the terms of this Second Amendment or the other Loan
Documents.
IN WITNESS WHEREOF, the parties hereto have caused their duly
authorized officers to execute and deliver this Second Amendment as of the date
first written above.
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TANGER PROPERTIES LIMITED
PARTNERSHIP
By its General Partner, Tanger Factory
Outlet Centers, Inc.
By: /s/ Xxxxxxx X. Xxxxxx
Name: Xxxxxxx X. Xxxxxx
Title: Chairman of the Board and
Chief Executive Officer
TANGER FACTORY OUTLET CENTERS, INC.
By: /s/ Xxxxxxx X. Xxxxxx
Name: Xxxxxxx X. Xxxxxx
Title: Chairman of the Board and
Chief Executive Officer
NATIONAL WESTMINSTER BANK Plc.,
New York Branch,
individually and as the
Agent and Issuing Bank
By: /s/ Xxxxx X. Xxxxx
Name: Xxxxx X. Xxxxx
Title: Vice President
NATIONAL WESTMINSTER BANK Plc.,
Nassau Branch
By: /s/ Xxxxx X. Xxxxx
Name: Xxxxx X. Xxxxx
Title: Vice President
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