**EXHIBIT 10.2**

 

**FIRST AMENDMENT TO UNSECUREDREVOLVING CREDIT AGREEMENT**

 

**THISFIRST AMENDMENT TO UNSECURED REVOLVING CREDIT AGREEMENT**(this“Amendment”) made as of the 16th day of March, 2004 by and among **AMERIVESTPROPERTIES INC.,** a Maryland corporation (“Borrower”), **FLEETNATIONAL BANK**, a national banking association****(“Fleet”;  Fleet and the other lenders which mayhereafter become a party to the Loan Agreement (as hereinafter defined) arehereinafter referred to collectively as the “Lenders”) and **FLEET NATIONAL BANK,** asAdministrative Agent (the “Agent”).

 

**W I T N E S S E T H:**

 

**WHEREAS,**Borrower, Fleet and Agent entered into that certain Unsecured Revolving CreditAgreement dated as of December 15, 2003 (the “Loan Agreement”); and

 

**WHEREAS,**Borrower, Agent and Fleet have agreed to modifycertain provisions of the Loan Agreement; and

 

**WHEREAS,**as a condition to such modification, Agent and Fleethave required that Borrower execute this Amendment;

 

**NOW,THEREFORE,** for and in consideration of the sum of TENand NO/100 DOLLARS ($10.00), and other good and valuable consideration, thereceipt and sufficiency of which is hereby acknowledged, the parties hereto dohereby covenant and agree as follows:

 

1.                                       Definitions.  All the terms used herein which are nototherwise defined herein shall have the meanings set forth in the LoanAgreement.

 

2.                                       ModificationFee.  Borrower hereby agrees to payto the Agent for the account of each Lender a non-refundable cash fee (the“Modification Fee”) in an amount equal to 0.125% (or 12.5 basis points) of theamount of each such Lender’s Commitment, which Modification Fee shall be fullyearned when paid and non-refundable under any circumstances.

 

3.                                       Modificationof the Loan Agreement.  Borrower,Agent and Fleet do hereby modify and amend the Loan Agreement as follows:

 

(a)                                  Bydeleting in its entirety the definition of the term “Funds from Operation”appearing in §1.1 of the Loan Agreement and inserting in lieu thereof thefollowing:

 

Funds FromOperations.  Withrespect to any fiscal period of the Borrower, an amount equal to net income(computed in accordance with Generally Accepted Accounting Principles) from theoperation of Real Estate Assets, excluding gains (or losses) from debtrestructuring and sales of property, plus real estate depreciation andamortization, and after adjustments for unconsolidated partnerships and jointventures; provided, however, in the event that Borrower shall not have owned aReal Estate Asset for the entire previous four fiscal quarters, then

 

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for the purpose ofdetermining the Funds From Operation with respect to such Real Estate Asset,the net income (computed in accordance with Generally Accepted AccountingPrinciples) for such Real Estate Asset shall be annualized in a mannerreasonably acceptable to Agent. Adjustments for unconsolidated partnerships and joint ventures will becalculated to reflect funds from operations on the same basis.

 

(b)                                 Bydeleting §8.7 of the Loan Agreement in its entirety and inserting in lieuthereof the following new §8.7:

 

“§8.7 Distributions.  Beginning with the period of fourconsecutive fiscal quarters ending March 31, 2005, Borrower shall notpermit the total Distributions by it during any period of four consecutive fiscalquarters calculated as of the end of each fiscal quarter to exceed ninetypercent (90%) of Funds From Operations during such period.  Such limitations on Distributions may beexceeded to the extent necessary for the Borrower to maintain its REIT statusprovided that the Borrower provides the Agent with a letter from itsaccountants or attorneys setting forth the basis for computation of the amountof such necessary excess Distributions. During any period, including without limitation, at any time prior toMarch 31, 2005 when any Default or Event of Default has occurred and iscontinuing the total Distributions by the Borrower will not exceed the minimumamount necessary for the Borrower to maintain its REIT status.”

 

(c)                                  Bydeleting §§9.4 and 9.5 of the Loan Agreement in their entirety and inserting inlieu thereof the following new §§9.4 and 9.5:

 

“§9.4 AdjustedEBITDA to Interest Expense.  TheBorrower will not permit the ratio of its Adjusted EBITDA to Interest Expenseto be less than 1.5 to 1.0 for any period of two fiscal quarters annualized,calculated as of the end of each fiscal quarter through and including thefiscal quarter ending March 31, 2004. Beginning with the fiscal quarterending June 30, 2004, the Borrower will not permit the ratio of itsAdjusted EBITDA to Interest Expense to be less than 1.75 to 1.0 for any periodof two fiscal quarters annualized, calculated as of the end of each fiscalquarter through and including the fiscal quarter ending December 31, 2004.  Beginning with the fiscal quarter endingMarch 31, 2005, the Borrower will not permit the ratio of its AdjustedEBITDA to Interest Expense to be less than 2.0 to 1.0 for any period of twofiscal quarters annualized, calculated as of the end of each fiscal quarter.

 

§9.5 EBITDA toFixed Charges.  The Borrower willnot permit the ratio of its EBITDA to Fixed Charges to be less than 1.35 to 1.0for any period of two fiscal quarters annualized, calculated as of the end ofeach fiscal quarter through and including the fiscal quarter endingMarch 31, 2004.  Beginning with thefiscal quarter ending June 30, 2004, the Borrower will not permit theratio of its EBITDA to Fixed Charges to be less than 1.5 to 1.0 for any periodof two fiscal quarters annualized, calculated as of the end of each fiscalquarter through and including the fiscal quarter ending December 31,2004.  Beginning with the fiscal quarterending March 31, 2005, the Borrower will not permit the ratio of itsEBITDA to Fixed

 

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Charges to be lessthan 1.75 to 1.0 for any period of two fiscal quarters annualized, calculatedas of the end of each fiscal quarter.”

 

(d)                                 Bydeleting Appendix I of Exhibit C of the Credit Agreement in its entirety andinserting in lieu thereof the new Appendix I attached hereto.

 

4.                                       Waiver.  The Agent and the Lender do hereby waive theDefault by Borrower of compliance with the covenants set forth in §8.7 of theLoan Agreement for the fiscal quarter ending December 31, 2003.  The Agent and the Lenders have made noagreement, and are in no way obligated, to grant any future extension, waiver,indulgence or consent.

 

5.                                       Referencesto Loan Agreement.  All referencesin the Loan Documents to the Loan Agreement shall be deemed a reference to theLoan Agreement as modified and amended herein.

 

6.                                       Representations.  Borrower represents and warrants to Agentand the Lenders as follows:

 

(a)                                  Authorization.  The execution, delivery and performance ofthis Amendment and the transactions contemplated hereby (i) are within theauthority of Borrower, (ii) have been duly authorized by all necessaryproceedings on the part of Borrower, (iii) do not and will not conflict with orresult in any breach or contravention of any provision of law, statute, rule orregulation to which Borrower is subject or any judgment, order, writ,injunction, license or permit applicable to Borrower, (iv) do not and will notconflict with or constitute a default (whether with the passage of time or thegiving of notice, or both) under any provision of the partnership agreement orcertificate, certificate of formation, operating agreement, articles ofincorporation or other charter documents or bylaws of, or any mortgage,indenture, agreement, contract or other instrument binding upon Borrower or anyof its properties or to which Borrower is subject (v) do not and will notresult in or require the imposition of any lien or other encumbrance on any ofthe properties, assets or rights of Borrower, other than the liens andencumbrances created by the Loan Documents.

 

(b)                                 Enforceability.  The execution and delivery of this Amendmentare valid and legally binding obligations of Borrower enforceable in accordancewith the respective terms and provisions hereof, except as enforceability islimited by bankruptcy, insolvency, reorganization, moratorium or other lawsrelating to or affecting generally the enforcement of creditors’ rights and theeffect of general principles of equity.

 

(c)                                  Approvals.  The execution, delivery and performance ofthis Amendment and the transactions contemplated hereby do not require theapproval or consent of any Person or the authorization, consent, approval of orany license or permit issued by, or any filing or registration with, or thegiving of any notice to, any court, department, board, commission or othergovernmental agency or authority other than those already obtained.

 

7.                                       NoDefault.  By execution hereof, theBorrower certifies that Borrower is and will be in compliance with allcovenants under the Loan Documents after the execution and delivery of thisAmendment, and that no Default or Event of Default has occurred and iscontinuing.

 

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8.                                       Waiverof Claims.  Borrower acknowledges,represents and agrees that Borrower does not have any defenses, setoffs,claims, counterclaims or causes of action of any kind or nature whatsoever withrespect to the Loan Documents, the administration or funding of the Loans orwith respect to any acts or omissions of Agent or the Lenders, or any past orpresent officers, agents or employees of Agent or the Lenders, and Borrowerdoes hereby expressly waive, release and relinquish any and all such defenses,setoffs, claims, counterclaims and causes of action, if any.

 

9.                                       Ratification.  Except as hereinabove set forth, all terms,covenants and provisions of the Loan Documents, including, without limitation,the Loan Agreement, remain unaltered and in full force and effect andconstitute the legally valid and binding obligation of Borrower enforceableagainst Borrower in accordance with their terms, and the parties hereto dohereby expressly ratify and confirm, the Loan Documents and the Loan Agreementas modified and amended herein.  Nothingin this Amendment shall be deemed or construed to constitute, and there has nototherwise occurred, a novation, cancellation, satisfaction, release,extinguishment or substitution of the indebtedness evidenced by the Notes orthe other obligations of Borrower under the Loan Documents.

 

10.                                 EffectiveDate.  This Amendment shall bedeemed effective and in full force and effect upon the execution and deliveryof this Amendment by Borrower, Agent and Fleet.

 

11.                                 Amendmentas Loan Document.  This Amendmentshall constitute a Loan Document.

 

12.                                 Counterparts.  This Amendment may be executed in any numberof counterparts which shall together constitute but one and the same agreement.

 

13.                                 Miscellaneous.  This Amendment shall be construed andenforced in accordance with the laws of The Commonwealth of Massachusetts.  This Amendment shall be binding upon andshall inure to the benefit of the parties hereto and their respective permittedsuccessors, successors-in-title and assigns as provided in the Loan Agreement.

 

 

**[Remainder ofPage Intentionally Left Blank; Signatures on Following Page]**

 

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**INWITNESS WHEREOF**, the parties hereto have hereto settheir hands and affixed their seals as of the day and year first above written.

 

 
|   | **BORROWER:**                                                                      |
|--------|------------------------------------------------------------------------------------|
|   |                                                                               |
|   | **AMERIVEST PROPERTIES, INC.**                                                     |
|   |                                                                               |
|   | By:                                                                                | John B. Greenman |
|   | Name:                                                                              | John B. Greenman |
|   | Title:                                                                             | Vice President |
|   |                                                                               |
|   | [CORPORATE  SEAL]                                                                  |
|   |                                                                               |
|   |                                                                               |
|   | **FLEET:**                                                                         |
|   |                                                                               |
|   | **FLEET NATIONAL  BANK,** a national banking  association                          |
|   |                                                                               |
|   | By:                                                                                | George A. Ojanuga |
|   | Name:                                                                              | George A. Ojanuga |
|   | Title:                                                                             | Director |
|   |                                                                               |
|   |                                                                               |
|   | **AGENT:**                                                                         |
|   |                                                                               |
|   | **FLEET NATIONAL  BANK,** a national banking  association, as Administrative Agent |
|   |                                                                               |
|   | By:                                                                                | George A. Ojanuga |
|   | Name:                                                                              | George A. Ojanuga |
|   | Title:                                                                             | Director |
|        |                                                                                    |  |  |  |

 

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