EXHIBIT 10.2
EXECUTION VERSION
FIFTH AMENDMENT TO LOAN AGREEMENT
THIS FIFTH AMENDMENT TO LOAN AGREEMENT (together with all schedules hereto, this
“Amendment”) among PGRT ESH, Inc., a Delaware corporation (the “Borrower”),
Lightstone Holdings LLC, a Delaware limited liability company (“Lightstone
Holdings”), David Lichtenstein (together with Lightstone Holdings, the
“Guarantors,” and collectively with the Borrower, the “Loan Parties”), and
Citicorp USA, Inc., a Delaware corporation (the “Lender”), is made as of
April 30, 2009.
W I T N E S S E T H :
WHEREAS, the Borrower and the Lender are parties to the Amended and Restated
Loan Agreement dated as of June 6, 2008, as amended by the First Amendment to
Loan Agreement dated as of October 31, 2008 (as amended by that certain letter
agreement dated December 31, 2008, that certain letter agreement dated
January 30, 2009 and that certain letter agreement dated March 2, 2009;
collectively, the “First Amendment”) among the Loan Parties and the Lender, the
Second Amendment to Loan Agreement dated as of December 31, 2008 among the Loan
Parties and the Lender (the “Second Amendment”), the Third Amendment to Loan
Agreement dated as of January 30, 2009 among the Loan Parties and the Lender
(the “Third Amendment”) and the Waiver and Fourth Amendment to Loan Agreement
dated as of March 2, 2009 (the “Fourth Amendment”; such Loan Agreement as
amended by the First Amendment, the Second Amendment, the Third Amendment and
the Fourth Amendment being hereinafter referred to as the “Loan Agreement”; the
terms defined therein being used herein as therein defined) among the Loan
Parties and the Lender;
WHEREAS, each of the Guarantors guaranteed the liabilities and obligations of
the Borrower under the Loan Agreement on the terms and conditions set forth in
an Amended and Restated Guaranty dated June 6, 2008, each as amended by the
First Amendment to Amended and Restated Guaranty dated as of October 31, 2008 by
each of the Guarantors in favor of the Lender (each, as amended, a “Guaranty”);
and
WHEREAS, the Loan Parties and the Lender have executed a letter agreement dated
the date hereof pursuant to which the Lender and the Loan Parties have agreed to
amend further the First Amendment.
NOW, THEREFORE, the Borrower, the Guarantors and the Lender agree as follows:
SECTION 1. Amendments to Loan Agreement. Effective as of the date hereof,
subject to the satisfaction of the conditions to effectiveness set forth in
Section 2, the Loan Agreement is amended as follows:
(a) The following new definition is hereto are hereby added to Section 1.1 of
the Loan Agreement in the appropriate alphabetical order:
“Lichtenstein Loan” shall have the same meaning ascribed to the definition of
“Loan” in the Lichtenstein Credit Agreement.

 

 

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(b) Section 2.2.4 is amended by deleting “April 30, 2009” each time it appears
in the amortization schedule and substituting “June 15, 2009” therefor.
(c) Section 2.2.5 is amended by adding “and upon written notice received from
the Lender,” after “Upon the occurrence and during the continuance of an Event
of Default” in the first sentence.
(d) Section 2.3.2(b) is amended and restated as set forth in Schedule 1 hereto:
(e) Schedule 2.3.2(b) is hereby deleted and replaced with Schedule 1(b) hereto.
(f) Section 5.1 is hereby amended by adding the following new sections thereto:
“ Section 5.1.14 Cash Committee.
Borrower shall cause The Lightstone Group, LLC to (i) maintain a committee to
oversee, approve and monitor the cash flow and capital expenditures of Borrower
and its Affiliates established on or before April 30, 2009 (the “Cash
Committee”) and (ii) continue to engage two representatives of Focus Management
Group USA, Inc. to serve as members of the Cash Committee.
Section 5.1.15 Cash Budgets.
Borrower shall cause Lightstone and each Affiliate of Lightstone (other than
Extended Stay of America Hotels) to submit to the Lender (i) on or before the
last day of each month, or on a more frequent basis as may be reasonably
requested by the Lender, a cash budget monitoring report with respect to the
actual results for the preceding month-end and year-to-date period comparing
such actual cash flow to the projected cash flow results for such periods, in
form and substance satisfactory to the Lender and (ii) on or before May 8, 2009,
the 2009 Lightstone World operating and cash performance budget, in form and
detail satisfactory to the Lender.
Section 5.1.16 Litigation.
Borrower shall comply, and shall cause the Guarantors to comply with the
covenant set forth on Schedule 5.1.16 hereto.
Section 5.1.17 Audits.
Borrower shall use its best efforts to (i) cause the audit being conducted by
Ernest & Young LLP with respect to Prime Retail Outlets for the years 2004 to
2007 to be completed on or before May 31, 2009, and (ii) cause the audit with
respect to Prime Retail Outlets for the year 2008 to be completed as promptly as
possible.

 

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Section 5.1.18 Financial Advisor.
Borrower shall not terminate, and shall not permit the termination of, the
engagement by Borrower of Focus Management Group USA, Inc., as the financial
advisor to the Borrower, without the prior written consent of Lender, which
consent may be withheld in Lender’s sole discretion.”
(g) Exhibit A is hereby added to the Loan Agreement as Schedule 5.1.16
SECTION 2. Conditions to Effectiveness. This Amendment shall become effective
when, and only when, the Lender shall have received, among other things (which,
in the case of documents, shall be dated, or dated as of, the date of this
Amendment):
(a) counterparts of this Amendment, duly executed by each Loan Party;
(b) a certificate of the Secretary or an Assistant Secretary of the Borrower
certifying (i) that the certificate of incorporation and the bylaws of the
Borrower have not been amended or otherwise modified since June 6, 2008 and are
in full force and effect, (ii) resolutions of the board of directors of the
Borrower authorizing the execution, delivery and performance of this Amendment
and any documents to be delivered in connection with this Amendment to which the
Borrower is a party and the transactions contemplated hereby and thereby and
(iii) the incumbency, names and true signatures of the officers of the Borrower
authorized to sign this Amendment and such other documents;
(c) a certificate of the managing member of Lightstone Holdings certifying
(i) that the certificate of formation and the operating agreement of Lightstone
Holdings have not been amended or otherwise modified since July 13, 2005 and
August 1, 2005, respectively, and are in full force and effect, (ii) that
attached thereto is a true and correct copy of a unanimous consent of the sole
member of Lightstone Holdings authorizing the execution, delivery and
performance of this Amendment and any documents to be delivered in connection
with this Amendment to which Lightstone Holdings is a party and the transactions
contemplated hereby and thereby and (iii) the incumbency, names and true
signatures of the managing member, managers or officers of Lightstone authorized
to sign this Amendment and such other documents; and
(d) each of the documents set forth on Schedule 2 hereto listed (a) through
(g) inclusive
SECTION 3. Reference to and Effect on the Loan Documents.
(a) Upon the effectiveness of this Amendment, on and after the date hereof, each
reference in the Loan Agreement to “this Agreement”, “hereunder”, “hereof”,
“herein” and words of like import, and such words or words of like import in
each reference in the other Loan Documents, shall mean and be a reference to the
Loan Agreement as amended hereby.
(b) Except as specifically waived and amended hereby, all of the terms and
provisions of the Loan Agreement and the other Loan Documents shall remain in
full force and effect and are hereby ratified and confirmed.

 

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(c) The execution, delivery and effectiveness of this Amendment shall not
operate as a waiver of any right, power or remedy of the Lender under any of the
Loan Documents or constitute a waiver of any provision of any of the Loan
Documents, nor shall anything contained herein be deemed to prejudice the
exercise by the Lender of any or all its rights and remedies under the Loan
Documents.
(d) This Amendment shall be deemed to be a Loan Document for all purposes.
(e) This Amendment is subject to Section 8.4 of the Loan Agreement.
SECTION 4. Execution in Counterparts. This Amendment may be executed in
counterparts, each of which when so executed and delivered shall be deemed to be
an original, and all of which taken together shall constitute one and the same
instrument. This Amendment may be executed and delivered by telecopier or other
electronic means with the same force and effect as if the same was a fully
executed and delivered original manual counterpart.
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IN WITNESS WHEREOF, each of the parties hereto has executed this Amendment or
caused this Amendment to be executed by its proper and duly authorized officer
or managing member as of the date first set forth above.

            Borrower

PGRT ESH, INC.
      By:   /s/ David Lichtenstein         David Lichtenstein        Chairman   
    Guarantors
      /s/ David Lichtenstein       David Lichtenstein              LIGHTSTONE
HOLDINGS LLC
      By:   /s/ David Lichtenstein         David Lichtenstein        Managing
Member        Lender

CITICORP USA, INC.
      By:   /s/ Diana Yusun         Diana Yusun        Director     

 

 

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Schedules Do Not deal with Prime Group Realty Trust’s Properties
and Are Intentionally Omitted