ThirdAmendment To Revolving Creditand Term Loan Agreement

 

This THIRD AMENDMENT TO REVOLVING CREDIT AND TERM LOAN AGREEMENT (this “Amendment”) is entered into as of August 6, 2008, by and among:  Centerline Holding Company and Centerline Capital Group Inc. (collectively, the “Borrowers”); those Persons listed as Guarantors on Schedule 1 hereto (each, a “Guarantor,” and, collectively, the “Guarantors”); and those Lenders constituting the Required Lenders, each as set forth on a counterpart signature page hereto, substantially in the form of Schedule 2 hereto (the “Required Lenders”).

 

RECITALS

 

Reference is made to the following facts that constitute the background of this Amendment:

 

A.           The parties hereto, among others, have entered into that certain Revolving Credit and Term Loan Agreement, dated as of December 27, 2007 (as amended, restated, supplemented or otherwise modified from time to time, the “Loan Agreement”).  Capitalized terms used herein and not otherwise defined herein shall have the same meanings herein as ascribed to them in the Loan Agreement;

 

B.           The Borrowers and the Guarantors have requested that the net worth covenant in Section 10.14 of the Loan Agreement, and certain defined terms used to determine compliance with such net worth covenant, be amended; and

 

C.           The Required Lenders are willing to grant such request on the terms and conditions set forth in this Amendment.

 

NOW, THEREFORE, in consideration of the foregoing recitals and of the representations, warranties, covenants and conditions set forth herein and in the Loan Agreement, and for other valuable consideration the receipt and adequacy of which is hereby acknowledged, the parties hereto agree as follows:

 

Section 1.                      Amendments.

 

(a)           Section 1.1.2 is hereby amended by adding the following new defined term after the term “Net Proceeds”:

 

“Net Worth. CHC’s total shareholders’ equity as set forth on the most recent balance sheet of CHC in accordance with GAAP as adjusted in the following manner, in each case, as such adjustment is approved by the Administrative Agent in its reasonable discretion: (i) by adding the amount attributable to Reclassified CRA Shares on the balance sheet of CHC to the extent not already included therein, (ii) by adding any charge to shareholders’ equity based on (A) the difference between fair value of the Reclassified CRA Shares as of the date on which such shares required reclassification and the carrying basis of such shares, and (B) the difference between the fair value of the Reclassified CRA Shares as of the date on which such shares required reclassification and the future redemption price of such shares, and (iii) by eliminating the increase or decrease to shareholders’ equity caused by the consolidation of Centerline High Yield CMBS Fund I LLC, Centerline High Yield CMBS Fund II LLC, Centerline High Yield CMBS Fund III LLC and Centerline Real Estate Special Situations

 

 

Mortgage Fund LLC (collectively, the “Consolidated Funds”) solely because of the application of FIN 46.”

 

(b)           Section 1.1.2 is hereby amended by adding the following new defined term after the term “Public Lender”:

 

“Reclassified CRA Shares.  Collectively, the Convertible Community Reinvestment Act Preferred Shares and the 4.4% Cumulative Perpetual Convertible CRA Preferred Shares (as such terms are defined in CHC’s Filings) that have been reclassified outside of permanent equity provided that such shares are not redeemable by the holder thereof prior to the Revolver Maturity Date.”

 

(c)           Section 10.14 is hereby deleted in its entirety and replaced with the following:

 

“10.14                      Net Worth.  CHC’s Net Worth shall be greater than $500,000,000 plus 75% of the Net Proceeds from any sale or issuance of CHC’s Capital Stock to the extent included in shareholders’ equity.

 

(d)           Exhibit 9.5.1(c) to the Loan Agreement is hereby replaced in its entirety with the form of compliance certificate attached hereto as Exhibit A.

 

Section 2.    Representations and Warranties.  The Borrowers and Guarantors, jointly and severally, represent and warrant to the Lenders, the Swingline Lender, the Issuing Bank and the Administrative Agent as of the date of this Amendment that: (a) no Default is in existence from and after, or will result from, the execution and delivery of this Amendment, or the consummation of any transactions contemplated hereby; (b) each of the representations and warranties of the Borrowers and the Guarantors in the Loan Agreement and the other Loan Documents is true and correct in all material respects on the effective date of this Amendment (except for representations and warranties limited as to time or with respect to a specific event, which representations and warranties shall continue to be limited to such time or event); and (c) this Amendment and the Loan Agreement are legal, valid and binding agreements of the Borrowers and the Guarantors and are enforceable against them in accordance with their terms.

 

Section 3.    Ratification.  Except as hereby amended, the Loan Agreement, all other Loan Documents and each provision thereof are hereby ratified and confirmed in every respect and shall continue in full force and effect, and this Amendment shall not be, and shall not be deemed to be, a waiver of any Default or of any covenant, term or provision of the Loan Agreement or the other Loan Documents.  In furtherance of the foregoing ratification, by executing this Amendment in the spaces provided below, each of the Guarantors, on a joint and several basis, hereby absolutely and unconditionally (a) reaffirms its obligations under the Guaranties, and (b) absolutely and unconditionally consents to (i) the execution and delivery by the Borrowers of this Amendment, (ii) the continued implementation and consummation of arrangements and transactions contemplated by the Loan Agreement (including, without limitation, as amended or waived hereby) and the other Loan Documents, and (iii) the performance and observance by each Borrower and each Guarantor of all of its respective agreements, covenants, duties and obligations under the Loan Agreement (including, without limitation, as amended hereby) and the other Loan Documents.

 

Section 4.    Conditions Precedent.  The agreements set forth in this Amendment are conditional and this Amendment shall not be effective until receipt by the Administrative Agent of a fully-executed counterpart of this Amendment.

 

 

Section 5.    Counterparts.  This Amendment may be executed and delivered in any number of counterparts with the same effect as if the signatures on each counterpart were upon the same instrument.  Any counterpart delivered by facsimile or by other electronic method of transmission shall be deemed an original signature thereto.

 

Section 6.    Amendment as Loan Document.  Each party hereto agrees and acknowledges that this Amendment constitutes a “Loan Document” under and as defined in the Loan Agreement.

 

Section 7.    GOVERNING LAW.  THIS FIRST AMENDMENT SHALL BE DEEMED TO CONSTITUTE A CONTRACT MADE UNDER THE LAWS OF THE STATE OF NEW YORK, INCLUDING ARTICLE 5 OF THE UCC, AND SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK (INCLUDING SECTION 5-1401 AND 5-1402 OF THE GENERAL OBLIGATIONS LAW, BUT OTHERWISE WITHOUT REGARD TO ITS CONFLICTS OF LAW RULES).

 

Section 8.    Successors and Assigns.  This Amendment shall be binding upon each of the Borrowers, the Guarantors, the Lenders, the Swingline Lender, the Issuing Bank, the Administrative Agent, the Agents and their respective successors and assigns, and shall inure to the benefit of each such Person and their permitted successors and assigns.

 

Section 9.    Headings.  Section headings in this Amendment are included herein for convenience of reference only and shall not constitute a part of this Amendment for any other purpose.

 

Section 10.         Expenses.  Each Borrower jointly and severally agrees to promptly reimburse the Administrative Agent for all expenses, including, without limitation, reasonable fees and expenses of outside legal counsel, such Person has heretofore or hereafter incurred or incurs in connection with the preparation, negotiation and execution of this Amendment and all other instruments, documents and agreements executed and delivered in connection with this Amendment.

 

Section 11.         Integration.  This Amendment contains the entire understanding of the parties hereto and with any other Lenders and parties to the Loan Agreement with regard to the subject matter contained herein.  This Amendment supersedes all prior or contemporaneous negotiations, promises, covenants, agreements and representations of every nature whatsoever with respect to the matters referred to in this Amendment, all of which have become merged and finally integrated into this Amendment.  Each of the parties hereto understands that in the event of any subsequent litigation, controversy or dispute concerning any of the terms, conditions or provisions of this Amendment, no party shall be entitled to offer or introduce into evidence any oral promises or oral agreements between the parties relating to the subject matter of this Amendment not included or referred to herein and not reflected by a writing included or referred to herein.

 

Section 12.       Jury Trial Waiver.  THE BORROWERS, GUARANTORS, ADMINISTRATIVE AGENT AND LENDERS BY ACCEPTANCE OF THIS AMENDMENT MUTUALLY HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE THE RIGHT TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED HEREON, ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS FIRST AMENDMENT, THE LOAN AGREEMENT, OR ANY OTHER LOAN DOCUMENTS CONTEMPLATED TO BE EXECUTED IN CONNECTION HEREWITH, OR ANY COURSE OF CONDUCT, COURSE OF DEALINGS, STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF ANY PARTY, INCLUDING, WITHOUT LIMITATION, ANY COURSE OF CONDUCT, COURSE OF DEALINGS, STATEMENTS OR ACTIONS OF ANY AGENT OR ANY LENDER RELATING TO THE ADMINISTRATION OF THE LOAN OR ENFORCEMENT OF THE LOAN DOCUMENTS, ARISING OUT OF TORT, STRICT LIABILITY, CONTRACT OR ANY OTHER LAW, AND AGREE THAT NO PARTY WILL SEEK TO

 

CONSOLIDATE ANY SUCH ACTION WITH ANY OTHER ACTION IN WHICH A JURY TRIAL CANNOT BE OR HAS NOT BEEN WAIVED.

 

 

 

IN WITNESS WHEREOF, the parties have caused this Third Amendment to be duly executed by their duly authorized officers or representatives, all as of the date first above written.

 

BORROWERS:		CENTERLINE HOLDING COMPANY
		By:	/s/ Robert L. Levy
			Name: Robert L. Levy
			Title:   Chief Financial Officer
		CENTERLINE CAPITAL GROUP INC.
		By:	/s/ Robert L. Levy
			Name: Robert L. Levy
			Title:    Vice President

 

     

 

 

 

 

GUARANTORS:		CENTERLINE CAPITAL COMPANY LLC
		By:	/s/ Marc D. Schnitzer
			Name: Marc D. Schnitzer
			Title:   President
		CENTERLINE AFFORDABLE HOUSING ADVISORS LLC
		By:	/s/ Marc D. Schnitzer
			Name: Marc D. Schnitzer
			Title:    Chief Executive Officer

 

		CENTERLINE/AC INVESTORS LLC
		By:	/s/ Marc D. Schnitzer
			Name: Marc D. Schnitzer
			Title:   Chief Executive Officer
		CENTERLINE HOLDING TRUST
		By:	/s/ Marc D. Schnitzer
			Name: Marc D. Schnitzer
			Title:    Chief Executive Officer

		CENTERLINE INVESTORS I LLC
		By:	/s/ Marc D. Schnitzer
			Name: Marc D. Schnitzer
			Title:    Chief Executive Officer

 

 

 

 

 

GUARANTORS (CONT.):		CENTERLINE REIT INC.
		By:	/s/ Bryan Carr
			Name: Bryan Carr
			Title:   Chief Financial Officer
		CENTERLINE SERVICING INC.
		By:	/s/ Bryan Carr
			Name: Bryan Carr
			Title:   Chief Financial Officer

		CENTERLINE FINANCE CORPORATION
		By:	/s/ Bryan Carr
			Name: Bryan Carr
			Title:   Chief Financial Officer
		CENTERLINE INVESTOR LP LLC
		By:	/s/ Justin Ginsberg
			Name: Justin Ginsberg
			Title:   Vice President

 

		CENTERLINE INVESTOR LP II LLC
		By:	/s/ Justin Ginsberg
			Name: Justin Ginsberg
			Title:   Vice President

 

		CENTERLINE CREDIT MANAGEMENT LLC
		By:	/s/ Nicholas A.C. Mumford
			Name: Nicholas A.C. Mumford
			Title:   Executive Managing Director
		CM INVESTOR LLC
		By:	/s/ Marc D. Schnitzer
			Name: Marc D. Schnitzer
			Title:   Chief Executive Officer

 

      

 

 

 

1.	Centerline Investor LP,
2.	Centerline Investor LP II,
3.	CCC,
4.	CAHA,
5.	Centerline/AC,
6.	Holding Trust,
7.	Centerline Investors,
8.	Centerline REIT Inc.,
9.	Centerline Servicing Inc.,
10.	Centerline Finance Corporation,
11.	Credit Management, and
12.	CM Investor LLC.

 

The undersigned hereby evidences its agreement to the terms of the THIRD AMENDMENT TO REVOLVING CREDIT AND TERM LOAN AGREEMENT, and the consummation of the transactions contemplated thereby, amending that certain Revolving Credit and Term Loan Agreement dated as of December 27, 2007 by and among Centerline Holding Company and Centerline Capital Group Inc. as the Borrowers, the Guarantors described therein, the Lenders described therein, and Bank of America, N.A., as Administrative Agent, Swingline Lender and Issuing Bank, as such agreement is amended, restated, supplemented or otherwise modified from time to time.

By: ________________________________

Name:

Title:

Representing _____% of all Term Loans outstanding, all Revolving Exposure, unused Revolving Loan Commitments and unused Term Loan Commitments

[Schedule 9.5.1 – Form of Compliance Certificate]

 

 

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