Document:

Prepared by MERRILL CORPORATION

Exhibit

10.3

SECOND

MODIFICATION AGREEMENT

 

THIS

SECOND MODIFICATION AGREEMENT

(this "Agreement" or “Second Modification”) is made as of

October 30, 2001, by and among RESORTQUEST INTERNATIONAL, INC. (the "Company"),

certain subsidiaries of the Company as guarantors set forth on the signature

pages hereof (the “Guarantors”) and each of the Noteholders

set forth on the signature pages hereof (together with their permitted

successors, transferees and assigns, the "Noteholders").

 

RECITALS

 

WHEREAS,

pursuant to those certain Note Purchase

and Guarantee Agreements, dated as of June 1, 1999 (as amended by a

certain Modification Agreement dated as of July 24, 2000, collectively,

the “Note

Purchase and Guarantee Agreement”), entered into by the Company and

the Guarantors with each of the Noteholders, the Noteholders purchased

$50,000,000 in aggregate principal amount of the Company’s 9.06% Guaranteed

Senior Secured Notes, Due June 16, 2004 (the “Notes”).  The Company, the Guarantors and the

Noteholders have agreed to amend the Note Purchase and Guarantee Agreement in

the manner provided below, and have agreed to be bound by this Agreement, in

each case, pursuant to and in accordance with the provisions hereof;

 

NOW,

THEREFORE, in consideration of the

foregoing, the mutual premises, covenants and agreements contained herein, and

for other good and valuable consideration, the receipt and sufficiency of which

are hereby acknowledged, the parties hereto agree as follows:

 

1.             DEFINED TERMS

 

Unless

otherwise defined herein, terms that are defined in the Note Purchase and

Guarantee Agreement are used herein as so defined.

 

2.             AMENDMENTS

 

2.1          Amendment of Note Purchase and

Guarantee Agreement.

 

Subject

to the satisfaction of the conditions set forth in Section 4 below:

 

(a)           the Note Purchase and Guarantee

Agreement is hereby amended in the manner specified in Exhibit A-1 to this

Agreement;

 

(b)           all Notes outstanding as of the

Effective Date (as hereinafter defined) are hereby amended in the manner

specified in Exhibit A-2 to this Agreement; and

 

(c)           the form of the Note attached as

Exhibit 1 to the Note Purchase and Guarantee Agreement is hereby amended and

restated in the manner specified in Exhibit A-3 to this Agreement;

 

(collectively,

such amendments provided for in such Exhibits are herein referred to as the

"Amendments").

The Note Purchase and Guarantee Agreement as amended by the Amendments is

sometimes referred to herein as the “Amended Note Purchase and Guarantee Agreement”.  The Notes as amended by the Amendments are sometimes

referred to herein as the “Amended Notes”.

 

2.2          Exchange

of Notes.

 

Without limitation of

the provisions of Section 2.1, upon the satisfaction of all of the conditions

set forth in Section 4 below, the Notes shall be, for all purposes and without any

further action being required on the part of any Person, amended as provided

herein, provided,

that any Noteholder may (but shall not be required to in order to be entitled

to the benefits of this Agreement) at any time exchange the outstanding Notes held

by it for one or more new Amended Notes explicitly reflecting the amendments

provided for herein.

 

2.3          Effect of

Amendments.

 

Except as expressly

amended hereby, the Note Purchase and Guarantee Agreement, the Notes and the

Security Documents shall continue in full force and effect in accordance with

the provisions thereof.  Except as

expressly provided herein, this Agreement shall not be deemed (a) to be a

waiver of, or consent to, or a modification or amendment of, any other term or

condition of the Note Purchase and Guarantee Agreement, the Notes or any

Security Document, or (b) to prejudice any right or rights which the

Noteholders may have in the future under or in connection with the Note

Purchase and Guarantee Agreement, the Notes or any Security Document.

 

2.4          Amendment as a Security Document.

 

                This Amendment shall constitute

a Security Document as such term is defined in the Note Purchase and Guarantee

Agreement.

 

3.             REPRESENTATIONS AND WARRANTIES.

 

The

Company and each Guarantor (individually, an “Obligor” and, collectively,

the “Obligors”)

warrants and represents to each Noteholder that, as of the Effective Date, the

following statements are true, correct and complete:

 

3.1          Organization; Power and Authority.  Each Obligor is duly organized, validly

existing and in good standing under the laws of the State of its incorporation,

and is duly qualified as a foreign corporation and is in good standing in each

jurisdiction in which such qualification is required by law, other than those

jurisdictions as to which the failure to be so qualified or in good standing

could not, individually or in the aggregate, reasonably be expected to have a

Material Adverse Effect.  Each Obligor

has the corporate power and authority to own or hold under lease the properties

it purports to own or hold under lease, to transact the business it transacts

and proposes to transact, to execute and deliver this Agreement and to perform

its obligations hereunder and under the Amended Note Purchase and Guarantee

Agreement and the Amended Notes.

 

3.2          Authorization, etc.  This Agreement has been duly executed and

delivered and duly authorized by all necessary corporate or other action on the

part of each Obligor, and each of this Agreement, the Amended Note Purchase and

Guarantee Agreement and the Amended Notes constitutes a legal, valid and

binding obligation of each Obligor enforceable against each Obligor in

accordance with its terms, except as such enforceability may be limited by (a)

applicable bankruptcy, insolvency, reorganization, moratorium or other similar

laws affecting the enforcement of creditors' rights generally and

(b) general principles of equity (regardless of whether such

enforceability is considered in a proceeding in equity or at law).

 

3.3          Disclosure.  None of the written statements, documents or

other written materials furnished by, or on behalf of, the Obligors to the

Noteholders in connection with the negotiation, execution and delivery of this

Agreement and none of the financial statements and other certificates provided

to the Noteholders pursuant to the provisions of the Note Purchase and Guaranty

Agreement contain any untrue statement of a material fact or omit a material

fact necessary to make the statements contained therein or herein not

misleading in light of the circumstances in which they were made.  There is no fact which the Obligors have not

disclosed to the Noteholders which materially affects adversely or, so far as

the Obligor can now foresee, will materially affect adversely the business,

prospects, profits, properties or condition (financial or otherwise) of the

Company and its Subsidiaries, taken as a whole, or the ability of the Obligors

to perform their obligations set forth herein or in the Amended Note Purchase

and Guarantee Agreement or the Amended Notes.

 

3.4          Compliance with Laws, Other

Instruments, etc.  The execution, delivery and performance by

the Obligors of this Agreement will not:

 

(a)           contravene, result in any breach of,

or constitute a default under, or result in the creation of any lien in respect

of any Property of any of the Obligors under any indenture, mortgage, deed of

trust, loan, purchase or credit agreement, lease, corporate charter or by-laws,

or any other agreement or instrument to which Obligors are bound or by which

the Obligors or any of their respective properties may be bound or affected,

including, without limitation, Section 8.7 of the Credit Agreement (as

hereinafter defined);

 

(b)           conflict with or result in a breach

of any of the terms, conditions or provisions of any order, judgment, decree,

or ruling of any court, arbitrator or Governmental Authority applicable to any

of the Obligors; or

 

(c)           violate any provision of any statute

or other rule or regulation of any Governmental Authority applicable to any of

the Obligors.

 

3.5          Governmental Authorizations, etc.  No

consent, approval or authorization of, or registration, filing or declaration

with, any Governmental Authority is required in connection with the execution,

delivery or performance by the Obligors of this Agreement.

 

3.6          Litigation; Observance of Agreements,

Statutes and Orders.

 

(a)           There are no actions, suits or

proceedings pending or, to the knowledge of the Obligors, threatened against or

affecting the assets, properties of the Obligors, or the Obligors in any court

or before any arbitrator of any kind or before or by any Governmental Authority

that, individually or in the aggregate, could reasonably be expected to have a

Material Adverse Effect.

 

(b)           None of the Obligors is in default

under any term of any agreement or instrument to which it is a party or by

which it is bound, or any order, judgment, decree or ruling of any court,

arbitrator or Governmental Authority or is in violation of any applicable law,

ordinance, rule or regulation (including without limitation Environmental Laws)

of any Governmental Authority, which default or violation, individually or in

the aggregate, could reasonably be expected to have a Material Adverse Effect.

 

3.7          No Defaults.  No event has occurred and is continuing and

no condition exists which, upon the effectiveness of the amendments provided

for in this Agreement or the Credit Agreement Amendment (as hereinafter

defined), would constitute a Default or Event of Default.

 

3.8          Credit Agreement.

The Obligors have delivered a true and correct copy of the Credit Agreement

Amendment to all Noteholders.  The

Credit Agreement Amendment is in full force and effect and all conditions

precedent to its effectiveness have been satisfied in full or otherwise

complied with by the Obligors.  Other

than as expressly set forth in the Credit Agreement Amendment, there are no

other agreements or understandings between any of the Obligors and any of the

Lenders (as defined in the Credit Agreement Amendment) identified therein with

respect to the Credit Agreement (as defined in the Credit Agreement Amendment)

or the indebtedness evidenced thereby or the Credit Agreement Amendment.  In addition, with respect to the Credit

Agreement, no defaults or events of default exist or will exist thereunder immediately

after giving effect to the Credit Agreement Amendment and this Agreement.

 

3.9          Material Assets. Pursuant

to the Security Documents, all of the Obligors’ material Collateral has been

assigned or pledged to Citibank, N.A., as collateral agent for the Noteholders

and the Banks, and such assignments and pledges remain in full force and

effect.

 

3.10        Incorporation of Representations and

Warranties From Note Purchase and Guarantee Agreement.  The representations and warranties contained

in Section 5 of the Note Purchase and Guarantee Agreement are and will be

true, correct and complete in all material respects on and as of the Effective

Date to the same extent as though made on and as of that date, except to the

extent such representations and warranties specifically relate to an earlier

date, in which case they were true, correct and complete in all material

respects on and as of such earlier date.

 

4.             CONDITIONS PRECEDENT

 

The

Amendments shall become effective as of the Effective Date upon the satisfaction

of the following conditions:

 

4.1          Consent of Required Holders.  The Obligors and the Noteholders shall have

executed and delivered this Agreement (the date so executed and delivered

herein referred to as the “Effective Date”).

 

4.2          Warranties

and Representations True; Compliance with Agreement.

 

(a)           Warranties and Representations True.  The warranties and representations contained

in Section 3 of this Agreement shall be true on the Effective Date with the

same effect as though made on and as of that date.

 

(b)           Compliance with this Agreement and the Credit Agreement Amendment.  The Obligors shall have performed and

complied with all agreements and conditions contained in this Agreement and the

Credit Agreement Amendment that are required to be performed or complied with

by the Obligors on or prior to, and such performance and compliance shall

remain in effect on, the Effective Date.

 

4.3          Waiver Fee and Expenses.  The Company shall have paid to each

Noteholder, in exchange for such Noteholder’s consent to the amendments

contemplated by this Agreement, an amendment fee equal to the product of (i)

one quarter of one percent (0.25%) times (ii) the outstanding principal amount

of the Notes held by such Noteholder on the Effective Date.  In addition, all fees and disbursements

required to be paid pursuant to Section 6.2 shall have been paid in full.

 

4.4          Opinion of Counsel for the

Obligors.  Counsel

for the Obligors shall have delivered an opinion of counsel that is

satisfactory in form and substance to the Noteholders and their special

counsel.

 

4.5          Proceedings Satisfactory.  All proceedings taken in connection with the

execution and delivery of this Agreement and the transactions contemplated

hereby shall be satisfactory to the Noteholders and their special counsel, and

the Noteholders and their special counsel shall have received copies of such

documents and information as they may reasonably request in connection

therewith.

 

4.6          Amendment to Credit Agreement.  The

Obligors party to the Credit Agreement Amendment and the Lenders shall have

executed and delivered the First Amendment to Amended and Restated Credit

Agreement, dated as of October __, 2001 (the “Credit Agreement Amendment”), in form and

substance satisfactory to each Noteholder, and each Noteholder shall have

received a copy thereof as originally in effect certified as true and complete

by an officer of the Company, and the same shall be in full force and effect.

 

5.             AFFIRMATION

OF OBLIGATIONS.

 

                Each Obligor hereby acknowledges

and affirms all of its obligations under the Note Purchase and Guarantee

Agreement, the Notes, and the Security Documents to which such Obligor is a

party.

 

6.             MISCELLANEOUS.

 

6.1          Successors and Assigns; Effect of

Agreement.  This Agreement shall be binding upon, and

shall inure to the benefit of, the successors and assigns of the parties hereto

and the holders from time to time of the Notes.  Except as amended herein, the terms and provisions of the Note

Purchase and Guarantee Agreement, the Notes and the Security Documents are

hereby ratified, confirmed and approved in all respects.

 

6.2          Fees and Expenses.  On the Effective Date, the Company shall pay

all reasonable costs and expenses of the Noteholders relating to this

Agreement, including, but not limited to, the statement for reasonable fees and

disbursements of the Noteholders' special counsel presented to the Company on

or prior to the Effective Date.  The

Company will also pay, upon receipt of any statement thereof, each additional

statement for reasonable fees and disbursements of the Noteholders' special

counsel rendered after the Effective Date in connection herewith.  The obligations of the Company under this

Section 6.2 shall survive the termination of this Agreement.

 

6.3          Survival.  All warranties, representations, certifications

and covenants made by the Obligors in this Agreement or in any certificate or

other instrument delivered by it or on its behalf under this Agreement shall be

considered to have been relied upon by the Noteholders and shall survive the

execution of this Agreement, regardless of any investigation made by or on

behalf of any Noteholder.  All such

statements made herein or in any such certificate or other instrument shall

constitute warranties and representations of the Obligors under this Agreement

and the Note Purchase and Guarantee Agreement.

 

6.4          Governing Law.  This Agreement shall be construed and

enforced in accordance with, and the rights of the parties shall be governed

by, internal New York law.

 

6.5          Section Headings, etc.  The titles of the Sections hereof appear as

a matter of convenience only, do not constitute a part hereof and shall not

affect the construction hereof.  The

words "herein," "hereof," "hereunder" and "hereto"

refer to this Agreement as a whole and not to any particular Section or other

subdivision.  References to Sections

are, unless otherwise specified, references to Sections of this Agreement.  References to Annexes and Exhibits are,

unless otherwise specified, references to Annexes and Exhibits attached to this

Agreement.

 

6.6          Duplicate Originals; Execution in

Counterpart.  Two or more duplicate originals of this

Agreement may be signed by the parties, each of which shall be an original but

all of which together shall constitute one and the same instrument.  This Agreement may be executed in one or

more counterparts and shall be effective when at least one counterpart shall

have been executed by each party to this Agreement, and each set of

counterparts which, collectively, show execution by each such party to this Agreement

shall constitute one duplicate original.

 

 

 

 

[Remainder of page is intentionally

blank.  Next page is a signature page.]

IN

WITNESS WHEREOF, the Obligors and the

Noteholders have executed this Agreement as of the date first above written.

 

 

	

   

  	

  RESORTQUEST INTERNATIONAL, INC.

  
	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  
	

   

  	

  By

  	

  /s/  David L. Levine

  
	

   

  	

   

  	

  Name:

  	

  David L. Levine

  
	

   

  	

   

  	

  Title:

  	

  Chairman

  

 

[Signature Page to Second Modification

Agreement]

 

The

foregoing is hereby

agreed

to by the Noteholders

as

of the date thereof.

 

NOTEHOLDERS:

 

TEACHERS INSURANCE AND ANNUITY

ASSOCIATION

 

 

 

	

   

  	

   

  
	

  By:

  	

  /s/  Deirdre Macdonald

  	

   

  
	

   

  	

  Its:

  	

    Associate Director

  	

   

  
				

 

[Signature Page to Second Modification

Agreement]

 

PPM AMERICA, INC.,

as attorney in fact, on behalf of

Jackson

National Life Insurance Company

 

 

 

	

   

  	

   

  
	

  By:

  	

  /s/  Chris Raub

  	

   

  
	

   

  	

  Its:

  	

    Senior Managing Director

  	

   

  
				

 

[Signature Page to Second Modification

Agreement]

 

CONNECTICUT GENERAL LIFE

INSURANCE COMPANY

 

By:  CIGNA INVESTMENTS, INC. (authorized agent)

 

 

 

	

   

  	

   

  
	

  By:

  	

  /s/  Donald F. Rieger, Jr.

  	

   

  
	

   

  	

  Its:

  	

    Managing Director

  	

   

  
				

 

 

 

LIFE INSURANCE COMPANY OF NORTH

AMERICA

 

By:  CIGNA INVESTMENTS, INC. (authorized agent)

 

 

 

	

   

  	

   

  
	

  By:

  	

  /s/  Donald F. Rieger, Jr.

  	

   

  
	

   

  	

  Its:

  	

    Managing Director

  	

   

  
				

 

[Signature Page to Second Modification

Agreement]

 

 

MASSACHUSETTS MUTUAL LIFE

INSURANCE COMPANY

 

 

	

  By:

  	

  David L. Babson &

  Company Inc.,

  
	

   

  	

  Its Investment Advisor

  
	

   

  	

   

  
	

   

  	

   

  
	

   

  	

  By:

  	

  /s/  Mark A. Ahmed

  	

   

  
	

   

  	

  Its:

  	

    Managing Director

  	

   

  

 

[Signature Page to Second Modification

Agreement]

 

C.M. LIFE INSURANCE COMPANY

 

	

  By:

  	

  David L. Babson &

  Company Inc.,

  
	

   

  	

  Its Investment

  Sub-advisor

   

  
	

   

  	

   

  
	

   

  	

   

  
	

   

  	

  By:

  	

  /s/  Mark A. Ahmed

  	

   

  
	

   

  	

  Its:

  	

    Managing Director

  	

   

  

 

[Signature Page to Second Modification

Agreement]

 

UNITED OF OMAHA LIFE INSURANCE

COMPANY

 

 

 

	

   

  	

   

  
	

  By:

  	

  /s/  Curtis R. Caldwell

  	

   

  
	

   

  	

  Its:

  	

    First Vice President

  	

   

  
				

 

[Signature Page to Second Modification

Agreement]

 

GUARANTORS

 

Abbott

& Andrews Realty, Inc.

Abbott

Realty Services, Inc.

Abbott

Resorts, Inc.

Advantage

Vacation Homes by Styles, Inc.

B&B

on the Beach, Inc.

Bluebill

Properties, Inc.

Bluebill

Vacation Properties, Inc.

Brindley

& Brindley Realty & Development, Inc.

Coastal

Resorts Management, Inc.

Coastal

Resorts Realty, L.L.C.

Coates,

Reid & Waldron, Inc.

Collection

of Fine Properties, Inc.

CRW

Property Management, Inc.

First

Resort Software, Inc.

Hotel

Corporation of the Pacific, Inc.

Houston

& O’Leary Company

Howey

Acquisition, Inc.

Maui

Condominium & Home Realty, Inc.

Plantation

Resort Management, Inc.

Priscilla

Murphy Realty, Inc.

R

& R Resort Rental Properties, Inc.

Realty

Consultants, Inc.

Resort

Property Management, Inc.

Shoreline

Rentals, Inc.

Styles

Estates, Ltd., Inc.

Telluride

Resort Accommodations, Inc.

Ten

Mile Holdings, Ltd.

The

Management Company, Inc.

The

Maury People, Inc.

The

Tops’l Group, Inc.

Trupp-Hodnett

Enterprises, Inc.

Whistler

Chalets Ltd.

Worthy

Owner Realty Group, Inc.

 

The

following signature is on behalf of each of the foregoing Guarantors

 

 

 

	

  By:

  	

  /s/  David L. Levine

  
	

   

  	

  Name:

  	

  David L. Levine

  
	

   

  	

  Title:

  	

  Chairman

  
	

   

  	

  Its Authorized Officer

  

 

[Signature Page to Second Modification

Agreement]

 

 

EXHIBIT

A-1

AMENDMENTS

TO NOTE PURCHASE AND GUARANTEE AGREEMENT

 

1.             Amendment to Section 1.  Authorization of Notes; Guarantee.

 

Section

1(a) of the Note Purchase and Guarantee Agreement is hereby amended by deleting

it in its entirety and substituting therefor the following:

 

“(a)         The

Company will authorize the issue and sale of $50,000,000 aggregate principal

amount of its 9.06% Guaranteed Senior Secured Notes, due June 16, 2004, such

term to include any such notes issued in substitution therefor pursuant to

Section 13 of this Agreement.  The Notes

shall bear interest at the Interest Rate. 

Interest shall be payable semiannually on the sixteenth day of June and

December in each year (commencing December 16, 1999) and at maturity.  Notwithstanding the foregoing, commencing

after the semi-annual interest payment due December 16, 2001, and continuing

until the Covenant Compliance Date (as hereinafter defined), interest shall be

payable quarterly on the sixteenth day of each March, June, September and

December in each year (commencing on March 16, 2002) and at maturity; provided,

that, if the Company shall fail or be unable to make the representation and

warranty required pursuant to Section 7.1(i)(B) or such representation and

warranty proves to have been false or incorrect in any respect, then commencing

immediately and continuing until the Covenant Compliance Date, interest shall

be payable monthly on the sixteenth day of each month and at maturity.  As used herein, the term “Covenant

Compliance Date” shall mean the first date at the end of any fiscal

quarter on which the ratio set forth in Section 10.5 is greater than or equal

to 2.0 to 1.0, the ratio set forth in Section 10.6 is less than or equal to 2.5

to 1.0, and the Consolidated Leverage Ratio is less than or equal to 2.5 to 1.0

(it being the intent of the parties hereto that the Company must be in

compliance with each of the foregoing ratios as of the end of the same fiscal

quarter in order for the Covenant Compliance Date to occur).  Upon the occurrence of the Covenant

Compliance Date interest shall again be payable semiannually on the sixteenth

day of June and December in each year (commencing with the next June 16th

or December 16th occurring immediately after the Covenant Compliance

Date) and at maturity. The Notes will bear interest on overdue principal

(including any overdue required or optional prepayment of principal) and

Make-Whole Amount, if any, and (to the extent legally enforceable) on any

overdue installment of interest at the Default Rate after the date due, whether

by acceleration or otherwise, until paid. 

The Notes will mature on June 16, 2004, and will be substantially in the

form set out in Exhibit 1, with such changes therefrom, if any, as may be approved

by each Purchaser and the Company. 

Certain capitalized terms used in this Agreement are defined in Schedule

B; references to a “Schedule” or an “Exhibit” are, unless otherwise specified,

to a Schedule or an Exhibit attached to this Agreement.”

 

2.             Amendment of Section 7. 1 Financial

and Business Information.

 

2.1          Section 7.1 of the Note Purchase

and Guarantee Agreement is hereby amended by inserting as a new clause (i)

thereto the following:

 

“(i)          Monthly Financial Statements.  As soon as available, and in any event

within twenty (20) days after the first day of each calendar month, (i) a

consolidating balance sheet and income statement of the Company and its

Subsidiaries, as of the end of the immediately preceding calendar month,

together with a related consolidating statement of cash flows, in each case

setting forth in comparative form consolidating figures for the corresponding

calendar month of the preceding fiscal year and (ii) a consolidated statement

as of the end of the immediately preceding calendar month setting forth the occupancy

rates in each hotel, resort, place of accommodation or other facility managed,

owned, leased or operated by the Company and its Subsidiaries (it being

understood that the foregoing occupancy rates need not be set forth on an

individual hotel or other facility basis, but may be presented in a

consolidated summary format by region, operating units or other manner

reasonably approved by the Required Holders), setting forth in comparative form

consolidated figures for the corresponding calendar month of the preceding

fiscal year, all such financial information described above to be in reasonable

form and detail and reasonably acceptable to the Required Holders, and

accompanied by (A) a certificate of the chief financial officer of the Company

to the effect that such monthly financial statements fairly present in all

material respects the financial condition of the Company and its Subsidiaries,

as applicable, and have been prepared in accordance with GAAP, subject to

changes resulting from audit and normal year-end audit adjustments, and (B) a

certificate of the Company whereby the Company represents and warrants to the

Noteholders that as of the date of such certificate, based on the Company’s

then-current good faith projections, the Company will have sufficient funds

available (whether under the Company’s revolving credit facility or otherwise)

to make the next coming interest payments due under the Notes, such

availability to be not less than 125% of the aggregate amount of such interest

payments.”

2.2          Section

7.1 of the Note Purchase and Guarantee Agreement is hereby further amended by

inserting as a new clause (j) thereto the following:

“(j)          Semi-Monthly Reporting.  Within five (5) Business Days after the

first (1st) and fifteenth (15th) day of each calendar

month, (i) a consolidated statement as of the end of such semi-monthly period

of all bookings in each hotel, resort, place of accommodation or other facility

managed, owned, leased or operated by the Company and its Subsidiaries (it

being understood that the foregoing bookings need not be set forth on an

individual hotel or other facility basis, but may be presented in a

consolidated summary format by region, operating units or other manner

reasonably approved by the Required Holders), setting forth in comparative form

consolidated figures for the corresponding semi-monthly period of the preceding

fiscal year and (ii) a consolidated statement of projected unrestricted cash

and revolver balances of the Company and its Subsidiaries for the twelve (12)

week period commencing on the first day after the end of each such semi-monthly

period, all such information described above to be in reasonable form and

detail and reasonably acceptable to the Required Holders, and accompanied by a

certificate of the chief financial officer of the Company to the effect that

such statements are good faith estimates for the respective periods covered

thereby.”

3.             Amendment

to Section 10.5 Fixed Charges Coverage Ratio.

Section

10.5 of the Note Purchase and Guarantee Agreement is hereby amended by deleting

it in its entirety and substituting therefor the following:

 

                                “Section 10.5

Fixed Charges Coverage Ratio.

 

As

calculated on the last day of each fiscal quarter, the Company shall not permit

the ratio of (a) Consolidated Income Available for Fixed Charges to

(b) Consolidated Fixed Charges for the period consisting of such fiscal

quarter and the immediately preceding three fiscal quarters, treated as a

single accounting period, to be less than the corresponding ratio set forth below:

 

	

  Period

  	

   

  	

  Ratio

  	

   

  
	

  Closing Date – 9/30/01

  	

   

  	

  2.00 to 1.0

  	

   

  
	

  10/01/01 – 12/31/01

  	

   

  	

  1.30 to 1.0

  	

   

  
	

  01/01/02 – 03/31/02

  	

   

  	

  1.10 to 1.0

  	

   

  
	

  04/01/02 – 06/30/02

  	

   

  	

  1.05 to 1.0

  	

   

  
	

  07/01/02 – 09/30/02

  	

   

  	

  1.05 to 1.0

  	

   

  
	

  10/01/02 – 12/31/02

  	

   

  	

  1.40 to 1.0

  	

   

  
	

  01/01/03 – Maturity

  	

   

  	

  2.00 to 1.0

  	

  ”

  

 

4.             Amendment to Section 10.6

Limitations on Debt.

 

Section 10.6

of the Note Purchase and Guarantee Agreement is hereby amended by deleting it

in its entirety and substituting therefor the following:

 

                                “Section 10.6

Limitations on Debt.

 

The

Company will not permit the ratio of (i) Consolidated Debt as of the end

of each fiscal quarter to (ii) Consolidated Operating Cash Flow for the

period consisting of such fiscal quarter and the preceding three fiscal

quarters, treated as a single accounting period, to be greater than the

corresponding ratio set forth below:

 

	

  Period

  	

   

  	

  Ratio

  	

   

  
	

  Closing Date – 9/30/01

  	

   

  	

  3.00 to 1.0

  	

   

  
	

  10/01/01 – 12/31/01

  	

   

  	

  4.25 to 1.0

  	

   

  
	

  01/01/02 – 03/31/02

  	

   

  	

  5.15 to 1.0

  	

   

  
	

  04/01/02 – 06/30/02

  	

   

  	

  5.15 to 1.0

  	

   

  
	

  07/01/02 – 09/30/02

  	

   

  	

  5.15 to 1.0

  	

   

  
	

  10/01/02 – 12/31/02

  	

   

  	

  3.75 to 1.0

  	

   

  
	

  01/01/03 – Maturity

  	

   

  	

  2.50 to 1.0

  	

   

  

 

If,

during the period over which Consolidated Operating Cash Flow is being

calculated, the Company or a Subsidiary has acquired one or more Persons (or

the assets thereof) resulting in such Persons becoming, or otherwise resulting

in, Subsidiaries, compliance with this covenant will be determined by

calculating consolidated Operating Cash Flow on a pro forma basis as if all

(but not less than all) of such Subsidiaries had become Subsidiaries at the

beginning of the four fiscal quarters most recently ended.”

 

5.             Amendment

to Section 10.

 

Section 10.9 of the Note

Purchase and Guarantee Agreement is hereby amended by deleting it in its

entirety and substituting therefor the following:

 

                                “Section 10.9 Limitation on Restricted Payment and

Investment.

 

The Company shall not, and shall not permit any Subsidiary to, make or

declare, or incur any liability to declare or make, any Restricted Payment or

Restricted Investment unless after giving effect to such action, no Default or

Event of Default would exist; provided, that, during the period from the Second

Amendment Effective Date until the Covenant Compliance Date, the Company shall

not make or declare, or incur any liability to declare or make, any Restricted

Payment whatsoever , and shall not permit any Subsidiary to, make or declare,

or incur any liability to declare or make, any Restricted Payment whatsoever

(except that any such Subsidiary may make or declare Restricted Payments solely

to the Company so long as no Default or Event of Default would exist after

giving effect to such action).”

 

6.             Amendment

to Section 10.

 

Section 10 of the Note

Purchase and Guarantee Agreement is hereby further amended by inserting as a

new Section 10.11 thereto the following:

 

                                “Section 10.11 Prepayments of Indebtedness, etc.

 

Until the occurrence of the

Covenant Compliance Date, the Company and its Subsidiaries shall not (a) amend

or modify the Credit Agreement if such amendment or modification would add or

change any terms in a manner adverse to the Company and its Subsidiaries, or

change the definition of Consolidated Leverage Ratio (or any definitions

included within the definition of Consolidated Leverage Ratio) or shorten the

final maturity or increase the amount of the revolving credit commitment

available to be borrowed thereunder or require any payment to be made sooner

than originally scheduled or increase the interest rate applicable thereto (or

the interest rate spread applicable thereto), or (b) make any prepayment of

principal of any Indebtedness (which shall not be deemed to include normal

repayments in the ordinary course of business of amounts owed under the

revolving credit facility under the Credit Agreement and shall not include any

refinancings or replacements of the revolving credit facility under the Credit

Agreement upon the scheduled maturity thereof with a replacement revolving

credit facility in the same principal amount) or elect or agree to any

reduction of commitments or availability under any revolving credit facility

unless, in either case, the Company or its Subsidiaries make a Pro Rata

Prepayment on the Notes (including the Make-Whole Amount with respect to such

Pro Rata Prepayment) at the same time as it makes such prepayment of principal

or reduces such commitments or availability. 

For the purposes hereof, "Pro Rata Prepayment" means the principal amount

determined by multiplying (i) the principal amount paid to the holder of

Indebtedness or the amount of the reduction of commitments or availability, by

(ii) a fraction, the numerator of which is the principal balance of the Notes

(not including the Make-Whole Amount) and the denominator of which is the

principal balance of the Indebtedness with respect to which such prepayment is

being made or, in the case of any reduction of commitments or availability

under any revolving credit facility, the amount of the revolving credit

commitment available to be borrowed thereunder (and before, in either case,

giving effect to such prepayment or reduction).”

 

7.             Amendment

to Section 11.  Events of Default.

 

Section 11 of the Note Purchase and

Guarantee Agreement is hereby amended by inserting as a new clause (l) thereto

the following:

 

“(l)          there shall be an event of default in

existence under, and as defined in, the Credit Agreement as a result of any

failure to pay any amounts due thereunder or in respect thereof or any failure

to comply with any of the provisions of Articles 7 or 8 thereof, regardless of

whether such event of default has been waived by the Lenders party to the

Credit Agreement and regardless of whether such Lenders are attempting to

exercise their remedies as a result of such event of default and without giving

effect to any amendment or waiver altering the terms of the Credit Agreement so

as to eliminate such event of default.”

 

8.             Amendment to Schedule B.

 

8.1          Schedule B

to the Note Purchase and Guarantee Agreement is hereby amended by deleting the

defined term “Consolidated Income Available for Fixed Charges” in its entirety

and substituting therefor the following:

 

“’Consolidated

Income Available for Fixed Charges’ means for any period the sum of

(i) Consolidated Adjusted Net Income, (ii) Consolidated Income Tax

Expense and (iii) Consolidated Fixed Charges; provided, however,

that the calculation of Consolidated Income Available for Fixed Charges shall

exclude non-cash charges occurring in the fiscal quarter ended

September 30, 2001 in an aggregate amount not to exceed $2,500,000

resulting from (x) the write-down of the value of the Company’s existing

reservation system, and (y) the recognition of deferred acquisition

costs.”

 

8.2          Schedule B to the Note Purchase

and Guarantee Agreement is hereby further amended by deleting the defined term

“Consolidated Operating Cash Flow” in its entirety and substituting therefor

the following:

 

“’Consolidated

Operating Cash Flow’ means the sum of (i) Consolidated Adjusted

Net Income and (ii) the amount of all Consolidated Interest Expenses,

depreciation, amortization, income taxes, deferred items and other non-cash

items of the Company and its Subsidiaries deducted in the determination of net

income; which deferred items and other non-cash items of the Company shall

include non-cash charges occurring in the fiscal quarter ended

September 30, 2001 in an aggregate amount not to exceed $2,500,000

resulting from (x) the write-down of the value of the Company’s existing

reservation system, and (y) the recognition of deferred acquisition

costs.”

 

8.3          Schedule B to the Note Purchase and

Guarantee Agreement is hereby further amended by inserting a new defined term

“Second Amendment Effective Date” as follows:

“’Second

Amendment Effective Date’ means October 30, 2001.”

 

8.4          Schedule B to the Note Purchase and

Guarantee Agreement is hereby further amended by inserting a new defined term

“Credit Agreement” as follows:

 

                “’Credit Agreement’means

the Amended and Restated Credit Agreement, dated as of January 22, 2001, as

amended by the First Amendment to Amended and Restated Credit Agreement, dated

as of October __, 2001, and as further amended with the consent of the

Required Holders as required hereunder.”

 

                8.5          Schedule

B to the Note Purchase and Guarantee Agreement is hereby further amended by

inserting a new defined term “Consolidated Leverage Ratio” as follows:

 

                “’Consolidated Leverage Ratio’

means “Consolidated Leverage Ratio” as defined in, and calculated in accordance

with, the Credit Agreement.”

 

                8.6          Schedule

B to the Note Purchase and Guarantee Agreement is hereby further amended by

inserting a new defined term “Interest Rate” as follows:

 

“’Interest

Rate’ means (a) from the date of issue through the Calculation Date

first occurring after the Second Amendment Effective Date, 9.06% per annum, and

(b) thereafter until the Calculation Date first occurring after the Covenant

Compliance Date, the applicable per annum interest rate corresponding to the

Consolidated Leverage Ratio in effect as of the most recent Calculation Date,

as shown in the following table:

 

	

  Pricing

  Level

  	

   

  	

  Consolidated

  Leverage Ratio

  	

   

  	

  Applicable

  Interest Rate

  	

   

  
	

  I

  	

   

  	

  <2.5 to 1.0

  	

   

  	

  9.06%

  	

   

  
	

  II

  	

   

  	

  >2.5

  to 1.0 and < 3.0 to 1.0

  	

   

  	

  9.31%

  	

   

  
	

  III

  	

   

  	

  >3.0

  to 1.0 and < 3.5 to 1.0

  	

   

  	

  9.56%

  	

   

  
	

  IV

  	

   

  	

  >3.5

  to 1.0 and < 4.0 to 1.0

  	

   

  	

  9.81%

  	

   

  
	

  V

  	

   

  	

  >4.0

  to 1.0

  	

   

  	

  10.06%

  	

   

  

 

As

of the Calculation Date first occurring after the Covenant Compliance Date, the

Interest Rate shall be 9.06% per annum.

 

The

Interest Rate shall be determined and adjusted quarterly on the date that is

five (5) Business Days after the Company shall have delivered to the Holders a

copy of the officer’s certificate to be delivered by the Company pursuant to

Section 7.1(c) of the Credit Agreement (which the Company hereby agrees to

deliver to each Holder when delivered pursuant to the Credit Agreement, and, in

any event, not later than 45 days after the end of each fiscal quarter) (each

such date that is five (5) Business Days after delivery of such officer’s

certificate or, if no such certificate is so delivered, each such date on which

such certificate was required to have been delivered, is referred to herein as

a ‘Calculation

Date’) for the most recently ended fiscal quarter of the Company and

shall be based upon the Consolidated Leverage Ratio as of the last day of the

most recently ended fiscal quarter of the Company preceding the applicable

Calculation Date; provided, however, that if the Company fails to

provide such officer’s certificate to the Holders for the last day of the most

recently ended fiscal quarter of the Company preceding the applicable

Calculation Date, the Interest Rate from such Calculation Date shall be based

upon Pricing Level V (shown on the table above) until such time as such

officer’s certificate is so delivered, whereupon the Interest Rate shall be

determined by the Consolidated Leverage Ratio as of the last day of the most

recently ended fiscal quarter of the Company preceding such Calculation

Date.  Each Interest Rate shall be

effective from one Calculation Date until the next Calculation Date.  Any adjustment in the Interest Rate shall be

applicable to all Notes, as the same may be amended from time to time.”

 

EXHIBIT A-2

AMENDMENTS TO NOTES

 

1.             Amendments

to Notes.  Each of the Notes is hereby amended by

 

                (a)           deleting the expression “9.06%” prior

to the expression “Guaranteed Senior Secured Note” in the title of each of the

Notes; and

 

                (b)           deleting the first paragraph in its

entirety and substituting therefor the following:

 

FOR

VALUE RECEIVED, the undersigned,

ResortQuest International, Inc. (herein called the “Company”), a corporation

organized and existing under the laws of the State of Delaware, hereby promises

to pay to [__________________________],

or registered assigns, the principal sum of [__________________________]

DOLLARS on [________ ___,] [_______], with interest (computed on the

basis of a 360-day year of twelve 30-day months) on the unpaid balance thereof

at the Interest Rate (as defined in the Note Purchase Agreement referred to

below).  Interest shall be payable on

such dates as required in the Note Purchase Agreement referred to below.  Interest shall also be payable, to the

extent permitted by law, on any overdue principal (including any overdue

required or optional prepayment) of principal, any overdue payment of interest

and any overdue payment of any Make-Whole Amount (as defined in the Note

Purchase Agreement referred to below), payable semiannually or monthly as

aforesaid (or, at the option of the registered holder hereof, on demand), at a

rate per annum from time to time equal to the greater of (i) 2% above the

then applicable interest rate and (ii) 2% over the rate of interest

publicly announced by Chase Manhattan Bank from time to time in New York, New

York as its “base” or “prime” rate.

 

2.             Each

reference to a “Note” or to the “Notes” contained in the Note Purchase and Guarantee

Agreement or any of the Security Documents shall, unless the context otherwise

requires, be deemed to be a reference to the Amended Note or the Amended Notes,

respectively, and any other amendments thereto.

EXHIBIT A-3

FORM OF NOTE

 

RESORTQUEST INTERNATIONAL, INC.

 

GUARANTEED SENIOR SECURED NOTE,

DUE JUNE 16, 2004

 

	

  No. [_______]

  	

   

  	

  [Date]

  
	

  $[__________]

  	

   

  	

  PPN 761183

  A*3

  

 

FOR

VALUE RECEIVED, the undersigned,

ResortQuest International, Inc. (herein called the “Company”), a corporation

organized and existing under the laws of the State of Delaware, hereby promises

to pay to [__________________________],

or registered assigns, the principal sum of [__________________________]

DOLLARS on [________ ___,] [_______], with interest (computed on the

basis of a 360-day year of twelve 30-day months) on the unpaid balance thereof

at the Interest Rate (as defined in the Note Purchase Agreement referred to

below). Interest shall be payable on such dates as required in the Note

Purchase Agreement referred to below. 

Interest shall also be payable, to the extent permitted by law, on any

overdue payment (including any overdue required or optional prepayment) of

principal, any overdue payment of interest and any overdue payment of any

Make-Whole Amount (as defined in the Note Purchase Agreement referred to

below), payable semiannually or monthly as aforesaid (or, at the option of the

registered holder hereof, on demand), at a rate per annum from time to time

equal to the greater of (i) 2% above the then applicable interest rate and

(ii) 2% over the rate of interest publicly announced by Chase Manhattan

Bank from time to time in New York, New York as its “base” or “prime” rate.

 

                Payments

of principal of, interest on and any Make-Whole Amount with respect to this

Note are to be made in lawful money of the United States of America at New

York, New York or at such other place as the Company shall have designated by

written notice to the holder of this Note as provided in the Note Purchase

Agreement referred to below.

 

                This

Note is one of a series of Guaranteed Senior Secured Notes, (herein called the

“Notes”)

issued pursuant to the Note Purchase and Guarantee Agreement, dated as of

June 1, 1999 (as from time to time amended, the “Note Purchase Agreement”),

between the Company and the Purchasers named therein and is entitled to the

benefits thereof.  Each holder of this

Note will be deemed, by its acceptance hereof, (i) to have agreed to the

confidentiality provisions set forth in Section 20 of the Note Purchase

Agreement and (ii) to have made the representation set forth in

Section 6.2 of the Note Purchase Agreement.

 

                This

Note is a registered Note and, as provided in the Note Purchase Agreement, upon

surrender of this Note for registration of transfer, duly endorsed, or

accompanied by a written instrument of transfer duly executed, by the

registered holder hereof or such holder’s attorney duly authorized in writing,

a new Note for a like principal amount will be issued to, and registered in the

name of, the transferee.  Prior to due

presentment for registration of transfer, the Company may treat the person in

whose name this Note is registered as the owner hereof for the purpose of

receiving payment and for all other purposes, and the Company will not be

affected by any notice to the contrary.

 

                This

Note is subject to optional prepayment, in whole or from time to time in part,

at the times and on the terms specified in the Note Purchase Agreement, but not

otherwise.  This Note is not subject to

mandatory prepayment.

 

                If

an Event of Default, as defined in the Note Purchase Agreement, occurs and is

continuing, the principal of this Note may be declared or otherwise become due

and payable in the manner, at the price (including any applicable Make-Whole

Amount) and with the effect provided in the Note Purchase Agreement.

 

                This

Note is equally and ratably secured by the Security Documents (as defined in

the Note Purchase Agreement).  Reference

is hereby made to the Security Documents for a description of the collateral

thereby mortgaged, warranted, bargained, sold, released, conveyed, assigned,

transferred, pledged and hypothecated, the nature and extent of the security

for the Notes, the rights of the Holders, the Collateral Agent (as defined in

the Note Purchase and Security Agreement) in respect of such security and

otherwise.

 

                This

Agreement shall be construed and enforced in accordance with, and the rights of

the parties shall be governed by, the law of the State of New York, excluding

choice-of-law principles of the law of such State that would require the

application of the laws of a jurisdiction other than such State.

 

	

   

  	

  RESORTQUEST INTERNATIONAL, INC.

  
	

   

  	

   

  
	

   

  	

   

  
	

   

  	

   

  
	

   

  	

  By:

  	

   

  
	

   

  	

  Its:Prepared by MERRILL CORPORATION

EXHIBIT 10.4

 

FIRST AMENDMENT

TO

AMENDED AND RESTATED CREDIT AGREEMENT

 

 

THIS

FIRST AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT (this “First Amendment”) is dated

as of October ___, 2001 and entered into by and among RESORTQUEST INTERNATIONAL, INC., a

Delaware corporation (the “Borrower”), the Guarantors (as defined in the

Credit Agreement, as hereinafter defined), the financial institutions listed on

the signature pages hereof (the “Lenders”), CITIBANK, N.A., as

administrative agent for the Lenders (in such capacity, the “Agent”), BANK OF

AMERICA, N.A., as documentation agent (in such capacity, the “Documentation

Agent”) and CRÉDIT LYONNAIS NEW YORK BRANCH, as syndication agent (in such

capacity, the “Syndication Agent”), and is made with reference to that

certain Amended and Restated Credit Agreement dated as of January 22, 2001, by

and among the Borrower, the Guarantors, the Lenders (as defined therein), the

Documentation Agent, the Syndication Agent and the Agent (the “Credit

Agreement”).  Capitalized terms used

herein without definition shall have the same meanings herein as set forth in

the Credit Agreement.

RECITALS

WHEREAS, the Borrower and the Lenders desire to

amend the Credit Agreement in the manner set forth below,

NOW,

THEREFORE, in

consideration of the premises and the agreements, provisions and covenants

herein contained, the parties hereto agree as follows:

Section 1.  AMENDMENTS TO THE CREDIT AGREEMENT

1.1          Amendments to Section 1:  Definitions

A.            Section 1.1 of the Credit Agreement is hereby amended by

deleting the definition of “Applicable Percentage” in its entirety and

substituting therefor the following:

 

“‘Applicable

Percentage’ means, for purposes of calculating (i) the applicable interest

rate for any day for any Base Rate Loan, (ii) the applicable interest rate for

any Eurodollar Loan, and (iii) the applicable rate of the Unused Fee for any

day for purposes of Section 3.5(a), the appropriate applicable

percentage corresponding to the Consolidated Leverage Ratio in effect as of the

most recent Calculation Date, as shown in the following table:

 

	

  Pricing Level

  	

   

  	

  Consolidated Leverage Ratio

  	

   

  	

  Applicable Percentage For

  Eurodollar Loans

  	

   

  	

  Applicable Percentage For Base Rate

  Loans

  	

   

  	

  Applicable Percentage For Unused

  Fees

  	

   

  
	

  I

  	

   

  	

  <2.5 to 1.0

  	

   

  	

  2.00%

  	

   

  	

  1.00%

  	

   

  	

  0.50%

  	

   

  
	

  II

  	

   

  	

  >2.5 to 1.0

  	

   

  	

  2.25%

  	

   

  	

  1.25%

  	

   

  	

  0.50%

  	

   

  
	

  III

  	

   

  	

  >3.0

  to 1.0

  	

   

  	

  2.50%

  	

   

  	

  1.50%

  	

   

  	

  0.50%

  	

   

  
	

  IV

  	

   

  	

  >3.5

  to 1.0

  	

   

  	

  2.75%

  	

   

  	

  1.75%

  	

   

  	

  0.50%

  	

   

  
	

  V

  	

   

  	

  >4.0

  to 1.0

  	

   

  	

  3.00%

  	

   

  	

  2.00%

  	

   

  	

  0.50%

  	

   

  

 

 

The Applicable

Percentages shall be determined and adjusted quarterly on the date (each, a ‘Calculation

Date’) five (5) Business Days after the date by which the Borrower is

required to provide the officer’s certificate in accordance with the provisions

of Section 7.1(c) for the most recently ended fiscal quarter of the

Consolidated Parties and shall be based upon the Consolidated Leverage Ratio as

of the last day of the most recently ended fiscal quarter of the Consolidated

Parties preceding the applicable Calculation Date; provided, however,

that if the Borrower fails to provide the officer’s certificate to the Agency

Services Address as required by Section 7.1(c) for the last day of the

most recently ended fiscal quarter of the Consolidated Parties preceding the

applicable Calculation Date, the Applicable Percentage from such Calculation

Date shall be based upon Pricing Level V until such time as an appropriate

officer’s certificate is provided, whereupon the Applicable Percentage shall be

determined by the Consolidated Leverage Ratio as of the last day of the most

recently ended fiscal quarter of the Consolidated Parties preceding such

Calculation Date.  Each Applicable

Percentage shall be effective from one Calculation Date until the next

Calculation Date.  Any adjustment in the

Applicable Percentages shall be applicable to all existing Revolving Loans as

well as any new Revolving Loans made or issued.”

 

B.            The definition of “Permitted Acquisition” in Section 1.1.

of the Credit Agreement is hereby amended by deleting in its entirety clause

(iv) thereof and replacing it with the following:

 

“(iv) whether or not the

Acquisition is made for cash or non-cash consideration (or any combination

thereof), including any assumption of Indebtedness, the Borrower shall have

delivered to the Agent a Pro Forma Compliance Certificate demonstrating that,

upon giving effect to the Acquisition on a pro forma basis, the Credit Parties will

be in compliance with all of the covenants set forth in Section 7.11,

and the Borrower shall have delivered to the Lender a certificate that, upon

giving effect to the Acquisition, (x) the Borrower shall have liquidity (i.e.

unused availability of Loans plus cash and Cash Equivalents) of at least

$5,000,000 and (y) the Consolidated Leverage Ratio shall be less than or equal

to 2.5 to 1.0.”

 

C.            The definition of “Permitted Investments” in Section 1.1

of the Credit Agreement is hereby amended by (a) adding the word “and” after

the semi-colon at the end of clause (viii) thereof, (b) deleting the semi-colon

at the end of clause (ix) thereof and inserting “.”, and (c) deleting in their

entirety clauses (x) and (xi) thereof.

 

D.            Section

1.1 of the Credit Agreement is hereby amended by deleting the definition of

“Consolidated EBITDA” in its entirety and substituting therefor the following:

 

“‘Consolidated EBITDA’ means, for any period,

the sum of (i) Consolidated Net Income for such period, plus (ii) an amount

which, in the determination of Consolidated Net Income for such period, has

been deducted for (A) Consolidated Interest Expense for such period, (B) total

federal, state, local and foreign income, value added and similar taxes for

such period and (C) depreciation and amortization expense for such period, all

as determined in accordance with GAAP; provided, however, that

the calculation of Consolidated EBITDA shall exclude non-cash charges occurring

in the fiscal quarter ended September 30, 2001 in an aggregate amount not to

exceed $2,500,000 resulting from (y) the write-down of the value of the

Borrower’s existing reservation system, and (z) the recognition of deferred

acquisition costs; and provided further that at the option of the

Borrower, Consolidated EBITDA would also include Consolidated EBITDA

attributable to each acquisition made during such period in an amount equal to:

 

 

(1)           when computing Consolidated EBITDA

for use in determining the Fixed Charge Coverage Ratio, the greater of (a) the

actual Consolidated EBITDA attributable to the Property acquired for the period

from the acquisition date to the applicable calculation date, or (b) an amount

equal to (I) Consolidated EBITDA computed on a pro forma basis with respect

to the Property acquired as if the acquisition date had occurred 12 months

prior to the applicable calculation date, divided by (II) twelve (12),

multiplied by (III) the number of full calendar months that have elapsed

between the actual acquisition date and the applicable calculation date; and

(2)           when computing Consolidated EBITDA

for any other purpose, an amount equal to Consolidated EBITDA computed on a pro

forma basis with respect to the Property acquired as if the acquisition date

had occurred 12 months prior to the applicable calculation date.”

 

1.2.         Amendments

to Section 2.1:  Revolving Loans

 

A.            Section 2.1(a)(iii) is hereby

amended by deleting in its entirety the last sentence of the first paragraph

thereof and replacing the same with the following:

 

                “If

the Lenders are not willing to commit to the requested Additional Revolving

Commitments in the requested amount, then within 45 Business Days after the

Borrower’s original request, provided notice thereof has been given to all

Lenders within 30 Business Days after the Borrower’s original request and

Borrower has obtained the prior written consent of all Lenders to Borrower

receiving any commitments from a Supplemental Lender (defined below), which

such consent may be withheld by any such Lender in its sole and absolute

discretion, another one or more financial institutions that qualify under this

Credit Agreement as Eligible Assignees (each, a “Supplemental Lender”)

may commit to provide the remainder of the required Additional Credit

Commitment.”

1.3          Amendments to Section 7:  Affirmative Covenants

A.            Section 7.1 of the

Credit Agreement is hereby amended by inserting as a new clause (l) thereto the

following:

“(l)  Monthly Financial Statements.  As soon as available, and in any event

within twenty (20) days after the first day of each calendar month, (i) a

consolidated balance sheet and income statement of the Consolidated Parties, as

of the end of the immediately preceding calendar month, together with a related

consolidated statement of cash flows, in each case setting forth in comparative

form consolidated figures for the corresponding calendar month of the preceding

fiscal year, (ii) a consolidating balance sheet and income statement of the Borrower

and its Subsidiaries, as of the end of the immediately preceding calendar

month, together with a related consolidating statement of cash flows, in each

case setting forth in comparative form consolidating figures for the

corresponding calendar month of the preceding fiscal year and (iii) a

consolidated statement as of the end of the immediately preceding calendar

month setting forth the occupancy rates in each hotel, resort, place of

accommodation or other facility managed, owned, leased or operated by the

Consolidated Parties (it being understood that the foregoing occupancy rates

need not be set forth on an individual hotel or other facility basis, but may

be presented in a consolidated summary format by region, operating units or

other manner reasonably approved by the Agent), setting forth in comparative

form consolidated figures for the corresponding calendar month of the preceding

fiscal year, all such financial information described above to be in reasonable

form and detail and reasonably acceptable to the Agent, and accompanied by a

certificate of the chief financial officer of the Borrower to the effect that

such monthly financial statements fairly present in all material respects the

financial condition of the Consolidated Parties or the Borrower and its

Subsidiaries, as applicable, and have been prepared in accordance with GAAP,

subject to changes resulting from audit and normal year-end audit adjustments.”

B.            Section 7.1 of the

Credit Agreement is hereby further amended by inserting as a new clause (m)

thereto the following:

“(m)  Semi-Monthly Reporting.  Within five (5) Business Days after the

first (1st) and fifteenth (15th) day of each calendar

month, (i) a consolidated statement as of the end of such semi-monthly period

of all bookings in each hotel, resort, place of accommodation or other facility

managed, owned, leased or operated by the Consolidated Parties (it being

understood that the foregoing bookings need not be set forth on an individual

hotel or other facility basis, but may be presented in a consolidated summary

format by region, operating units or other manner reasonably approved by the

Agent), setting forth in comparative form consolidated figures for the

corresponding semi-monthly period of the preceding fiscal year and (ii) a consolidated

statement of projected unrestricted cash and revolver balances of the

Consolidated Parties for the twelve (12) week period commencing on the first

day after the end of each such semi-monthly period, all such information

described above to be in reasonable form and detail and reasonably acceptable

to the Agent, and accompanied by a certificate of the chief financial officer

of the Borrower to the effect that such statements are good faith estimates for

the respective periods covered thereby.”

C.            Section 7.11(a) of

the Credit Agreement is hereby amended by deleting it in its entirety and

substituting therefor the following:

“(a)         Fixed Charge Coverage Ratio.   The Fixed Charge Coverage Ratio, as of the

last day of each fiscal quarter of the Consolidated Parties ending during any

of the periods set forth below, shall be greater than or equal to the

correlative ratio indicated:

	

  Period

  	

   

  	

  Minimum Fixed

  Charge Coverage Ratio

  	

   

  
	

  Closing Date – 09/30/01

  	

   

  	

  2.50 to 1.0

  	

   

  
	

  10/01/01 – 12/31/01

  	

   

  	

  2.30 to 1.0

  	

   

  
	

  01/01/02 – 03/31/02

  	

   

  	

  1.90 to 1.0

  	

   

  
	

  04/01/02 – 06/30/02

  	

   

  	

  1.75 to 1.0

  	

   

  
	

  07/01/02 – 09/30/02

  	

   

  	

  1.60 to 1.0

  	

   

  
	

  10/01/02 – 12/31/02

  	

   

  	

  1.85 to 1.0

  	

   

  
	

  1/01/03 – Maturity Date

  	

   

  	

  2.50 to 1.0

  	

   

  

                                ”

D.            Section 7.11(b) of

the Credit Agreement is hereby amended by deleting it in its entirety and

substituting therefor the following:

“(b)         Consolidated Leverage Ratio.   The Consolidated Leverage Ratio, as of the

last day of each fiscal quarter of the Consolidated Parties ending during any

of the periods set forth below, shall be less than or equal to the correlative

ratio indicated: 

	

  Period

  	

   

  	

  Maximum Consolidated Leverage Ratio

  	

   

  
	

  Closing Date – 06/30/01

  	

   

  	

  2.50 to 1.0

  	

   

  
	

  7/01/01 – 9/30/01

  	

   

  	

  3.00 to 1.0

  	

   

  
	

  10/01/01 – 12/31/01

  	

   

  	

  4.25 to 1.0

  	

   

  
	

  01/01/02 – 03/31/02

  	

   

  	

  5.15 to 1.0

  	

   

  
	

  04/01/02 – 06/30/02

  	

   

  	

  5.15 to 1.0

  	

   

  
	

  07/01/02 – 09/30/02

  	

   

  	

  5.15 to 1.0

  	

   

  
	

  10/01/02 – 12/31/02

  	

   

  	

  3.75 to 1.0

  	

   

  
	

  1/01/03 –Maturity Date

  	

   

  	

  2.50 to 1.0

  	

   

  

                                ”

E.             Section

7.11(d) of the Credit Agreement is hereby amended by deleting it in its

entirety and substituting therefor the following:

“(d) Consolidated

Capital Expenditures.  The Borrower

shall not permit Consolidated Capital Expenditures for any fiscal year to

exceed the lesser of (i) 4% of Consolidated Revenues or (ii) $10,000,000.  Notwithstanding the foregoing, the

Consolidated Parties shall not make any Consolidated Capital Expenditures

during calendar year 2002 (other than Software Expenditures permitted pursuant

to the next succeeding sentence) unless (i) such Consolidated Capital

Expenditures are set forth in a budget approved by the Agent in writing, (ii)

such Consolidated Capital Expenditures are for the following purposes and do

not exceed the following amounts: (A) an amount not to exceed $4,000,000 for

property maintenance capital expenditures (of which up to $1,200,000 may be

allocated to a new call center) and (B) an amount not to exceed $2,700,000 for

capital expenditures for corporate headquarters, centralized offices and

information technology, (iii) the same do not cause a violation of the provisions

of the first sentence of this clause (d); and (iv) no Default or Event of

Default has occurred and is continuing or would be caused thereby.  In addition to the Consolidated Capital

Expenditures permitted under the foregoing provisions of this Section 7.11(d),

so long as no Default or Event of Default has occurred and is continuing or

would be caused thereby, the Consolidated Parties shall also have the right to

make Software Expenditures in an aggregate amount not to exceed $15,000,000

during the period commencing on June 30, 2000 and ending on December 31, 2002.”

F.             Section

7.11 of the Credit Agreement is hereby amended by adding thereto as a new

clause (e) the following:

“(e) Minimum

Consolidated EBITDA.  The

Consolidated EBITBA, as of the last day of each fiscal quarter of the

Consolidated Parties set forth below, shall be greater than or equal to the

correlative dollar amount indicated: 

	

  Fiscal

  Quarter

  	

   

  	

  Minimum Consolidated EBITDA

  	

   

  
	

  10/01/01 – 12/31/01

  	

   

  	

  Negative

  ($11,700,000)

  	

   

  
	

  01/01/02 – 03/31/02

  	

   

  	

  $6,200,000

  	

   

  
	

  04/01/02 – 06/30/02

  	

   

  	

  $6,200,000

  	

   

  
	

  07/01/02 – 09/30/02

  	

   

  	

  $9,000,000

  	

   

  
	

  10/01/02 – 12/31/02

  	

   

  	

  Negative

  ($7,900,000)

  	

   

  

”

1.4.         Amendments to Section 8:  Negative Covenants

Section 8 of the Credit Agreement is hereby amended by

adding as a new Section 8.14 the following:

“Section 8.14. 

Amendment to the Note Purchase and Guarantee Agreement:  Pro Rata Payment.  The Borrower and the other Credit Parties shall not (a) amend or

modify the Note Purchase and Guarantee Agreement (or any of the documents

executed in connection therewith) if such amendment or modification would add

or change any terms in a manner adverse to the Borrower and/or any of the other

Credit Parties, or shorten the final maturity or require any payment to be made

sooner than originally scheduled or increase the interest rate applicable

thereto, or (b) make any prepayment of principal of any Indebtedness, unless

the Borrower makes a Pro Rata Prepayment, together with a corresponding

reduction of the Revolving Committed Amount, on the Loans (including sums

payable with respect to such Pro Rata Prepayment due under Section 3.12 of the

Credit Agreement) at the same time as it makes such prepayment of

principal.  For the purposes hereof,

‘Pro Rata Prepayment’ means the principal amount determined by multiplying (i)

the amount paid to the holder of Indebtedness by (ii) a fraction, the numerator

of which is the Revolving Committed Amount, (not including the amounts due

under Section 3.12 of the Credit Agreement) and the denominator of which is the

principal balance of the Indebtedness with respect to which such prepayment or

reduction is being made.  The Pro Rata

Prepayment shall be applied to the Loans in such order of priority as the Agent

may determine.”

1.5.         Amendment

to Section 9:  Events of Default

A.            Section

9.1(c)(ii) of the Credit Agreement is hereby amended by deleting it in its

entirety and substituting therefor the following:

“(ii)  default

in the due performance or observance of any term, covenant or agreement

contained in Sections 7.1(a), (b), (c), (d),

(l) or (m) and such default shall continue unremedied for a

period of at least 5 days after the earlier of a responsible officer of a

Credit Party becoming aware of such default or notice thereof by the Agent; or”

B.            Section

9.1(g)(iii) of the Credit Agreement is hereby amended by deleting it in its

entirety and substituting therefor the following:

“(iii) Any default under

the Senior Note Documents or the Additional Facility Documents shall occur and

the applicable grace period (if any) with respect to such default shall have

expired without such default being cured by the Credit Parties in a manner

acceptable to the necessary percentage of Noteholders or Additional Creditors,

as applicable, or permanently waived by the necessary percentage of Noteholders

or Additional Creditors, as applicable, provided, however, that notwithstanding

the foregoing, it shall nevertheless constitute an Event of Default hereunder

should there be an event of default under the Senior Note Documents as the result

of any failure to pay any amounts due under the Senior Note Documents or in

respect thereof or any failure to comply with any of the provisions of Sections

1, 7, 8, 9 and 10 of the Note Purchase and Guarantee Agreement, regardless of

whether such event of default has been waived by the Noteholders party thereto

or any agent acting on their behalf and regardless of whether the Noteholders

or such agent are attempting to exercise their remedies as a result of such

event of default and without giving effect to any amendment altering the terms

of the Senior Note Documents so as to eliminate such event of default.”

1.6.         Amendment to Exhibit 7.1(c):  Form of Officer’s Certificate

Exhibit 7.1(c) of the Credit Agreement is hereby

amended by deleting it in its entirety and substituting therefor the Form of

Officer’s Certificate attached hereto as Schedule 1.

Section 2.              CONDITIONS TO EFFECTIVENESS

Section 1 of this First Amendment shall become

effective only upon the satisfaction of all of the following conditions precedent

(the date of satisfaction of such conditions being referred to herein as the “First

Amendment Effective Date”):

A.            On

or before the First Amendment Effective Date, the Borrower shall deliver to the

Agent executed copies of this First Amendment (with sufficient originally

executed copies for each Lender and its counsel) dated the First Amendment

Effective Date.

B.            On

or before the First Amendment Effective Date, all corporate and other

proceedings taken or to be taken in connection with the transactions

contemplated hereby and all documents incidental thereto not previously found

acceptable by the Agent, acting on behalf of the Lenders, and its counsel shall

be satisfactory in form and substance to the Agent and such counsel, and the

Agent and such counsel shall have received all such counterpart originals or

certified copies of such documents as the Agent may reasonably request.

C.            On

or before the First Amendment Effective Date, the Borrower shall have paid to

each Lender who has consented to and joined in the execution of this First

Amendment, by wire transfer of immediately available federal funds, an

administration fee equal to product of (a) the Commitment of such Lender and

(b) 0.25%. 

D.            The

Borrower, the Noteholders and the other parties to the Second Modification

Agreement (defined below) shall have executed and delivered the Second

Modification Agreement, in form and substance satisfactory to the Agent, and

the Agent shall have received a copy thereof, as originally in effect,

certified as true and complete by an officer of the Borrower, and the same

shall be in full force and effect.

 

Section

3.              REPRESENTATIONS AND

WARRANTIES

In order to induce the Agent and the Lenders to enter

into this First Amendment and to amend the Credit Agreement in the manner

provided herein, each of the Credit Parties hereby represents to the Agent and

the Lenders that the following statements are true, correct and complete:

A.            Corporate Power and Authority. 

Each of the Credit Parties has all requisite corporate power and

authority to enter into this First Amendment and to carry out the transactions

contemplated by, and perform its obligations under, the Credit Agreement as

amended by this First Amendment (the “Amended Agreement”).

B.            Authorization of Agreements. 

The execution and delivery of this First Amendment and the performance

of the Amended Agreement by the Credit Parties have been duly authorized by all

necessary corporate action on the part of the Credit Parties, as applicable.

C.            No

Conflict.  Neither the execution and delivery of this

First Amendment, nor the consummation of the transactions contemplated herein,

nor performance of and compliance with the terms and provisions thereof by such

Credit Party will (a) violate or conflict with any provision of its articles or

certificate of incorporation or bylaws or other organizational or governing

documents of such Credit Party, (b) violate, contravene or materially conflict

with any Requirement of Law or any other law, regulation (including, without

limitation, Regulation U or Regulation X), order, writ, judgment, injunction,

decree or permit applicable to it, (c) violate, contravene or conflict

with contractual provisions of, or cause an event of default under, any

Material Agreement to which it is a party or by which it may be bound, or (d)

result in or require the creation of any Lien (other than those contemplated in

or created in connection with the Credit Documents) upon or with respect to its

properties.

D.            Governmental Consents. 

The execution and delivery by the Credit Parties of this First Amendment

and all other operative documents being delivered in connection herewith and

the performance by the Credit Parties of the Credit Party Obligations under the

Amended Agreement do not and will not require any registration with, consent or

approval of, or notice to, or other action to, with or by, any Governmental

Authority.

E.             Binding Obligation. 

This First Amendment has been duly executed and delivered by each of the

Credit Parties, and the First Amendment and the Amended Agreement will be

legally valid and binding obligations of the Credit Parties, enforceable

against the Credit Parties, in accordance with their respective terms, except

as may be limited by bankruptcy, insolvency, reorganization, moratorium or similar

laws relating to or limiting creditors’ rights generally or by equitable

principles relating to enforceability.

F.             Governmental Regulation; Securities

Activities.  Neither the making of the Loans pursuant to

the Amended Agreement nor the granting of a security interest in any Collateral

pursuant to the Collateral Documents violates Regulations T, U or X of the

Board of Governors of the Federal Reserve System.  It is not necessary in connection with the execution and delivery

of the Amended Agreement to register the Loans under the Securities Act of

1933, as amended, or to qualify any indenture under the Trust Indenture Act of

1939, as amended.

G.            Incorporation of Representations and

Warranties From Credit Agreement.  The

representations and warranties contained in this First Amendment and

Section 6 of the Credit Agreement are and will be true, correct and

complete in all material respects on and as of the First Amendment Effective

Date to the same extent as though made on and as of that date, except to the

extent such representations and warranties specifically relate to an earlier

date, in which case they were true, correct and complete in all material

respects on and as of such earlier date.

H.            Absence of Default. 

No event has occurred and is continuing or will result from the

consummation of the transactions contemplated by this First Amendment that

would constitute an Event of Default or a default which, with the giving of

notice or passage of time, or both, would constitute an Event of Default.

I.              Second Modification Agreement. 

The Borrower has delivered a true and correct copy of the Second

Modification Agreement (the “Second Modification Agreement”) by and among the

Borrower, the Guarantors (as defined therein) and the Noteholders, dated as of October

__, 2001, to the Agent.  The Second

Modification Agreement is in full force and effect and all conditions precedent

to its effectiveness have been satisfied in full or otherwise complied with by

the Borrower and the Guarantors.  Other

than as expressly set forth in the Second Modification Agreement, there are no

other agreements or understandings between the Borrower and any Guarantors and

the Noteholders with respect to the Note Purchase and Guarantee Agreement, no

defaults or events of default exist or will exist thereunder immediately after

giving effect to the Second Modification Agreement and this Agreement.  The financial covenants set forth in the

Senior Note Documents, as amended by the Second Modification Agreement, are not

more restrictive than the financial covenants set forth in Section 7.11 of the

Credit Agreement.

J.             Compliance with this Agreement and

the Second Modification Agreement.  The Borrower

and the Guarantors shall have performed and complied with all agreements and

conditions contained in this Agreement and the Second Modification Agreement

that are required to be performed or complied with by such parties on or prior

to, and such performance and compliance shall remain in effect on, the First

Amendment Effective Date.

Section

4.              ACKNOWLEDGEMENT AND

CONSENT

Each of the Credit Parties hereby acknowledges that it

has reviewed the terms and provisions of the Credit Agreement and this First

Amendment and consents to the amendment of the Credit Agreement effected

pursuant to this First Amendment.  Each

Credit Party hereby confirms that each Credit Document to which it is a party

or otherwise bound and all Collateral encumbered thereby will continue to

guaranty or secure, as the case may be, to the fullest extent possible the

payment and performance of all “Credit Party Obligations”, “Guarantied

Obligations” and “Secured Obligations,” as the case may be (in each case as

such terms are defined in the applicable Credit Document), including without

limitation the payment and performance of all such “Credit Party Obligations”,

“Guarantied Obligations” or “Secured Obligations,” as the case may be, now or

hereafter existing under or in respect of the Amended Agreement.

Each Credit Party acknowledges and agrees that any of

the Credit Documents to which it is a party or otherwise bound shall continue

in full force and effect and that all of its obligations thereunder shall be

valid and enforceable and shall not be impaired or limited by the execution or

effectiveness of this First Amendment.

Each Credit Party (other than the Borrower)

acknowledges and agrees that (i) notwithstanding the conditions to

effectiveness set forth in this First Amendment, such Credit  Party is not required by the terms of the

Credit Agreement or any other Credit Document to consent to the amendments to

the Credit Agreement effected pursuant to this First Amendment and

(ii) nothing in the Credit Agreement, this First Amendment or any other

Credit Document shall be deemed to require the consent of such Credit Party to

any future amendments to the Credit Agreement.

Section

5.  MISCELLANEOUS

A.            Reference

to and Effect on the Credit Agreement and the Other Credit Documents.

(i)            On

and after the First Amendment Effective Date, each reference in the Credit

Agreement to “this Agreement”, “hereunder”, “hereof”, “herein” or words of like

import referring to the Credit Agreement, and each reference in the other

Credit Documents to the “Credit Agreement”, “thereunder”, “thereof” or words of

like import referring to the Credit Agreement shall mean and be a reference to

the Amended Agreement.

(ii)           Except

as specifically amended by this First Amendment, the Credit Agreement and the

other Credit Documents shall remain in full force and effect and are hereby

ratified and confirmed.

(iii)          The

execution, delivery and performance of this First Amendment shall not, except

as expressly provided herein, constitute a waiver of any provision of, or

operate as a waiver of any right, power or remedy of the Agent or any Lender

under, the Credit Agreement or any of the other Credit Documents.

B.            Fees and Expenses. 

The Borrower acknowledges that all costs, fees and expenses as described

in Section 11.5 of the Credit Agreement incurred by the Agent and its counsel

with respect to this First Amendment and the documents and transactions

contemplated hereby shall be for the account of the Borrower.  The foregoing shall not be construed to

diminish or limit the obligations of the Borrower set forth in Section 11.5 of

the Credit Agreement.

C.            Headings. 

Section and subsection headings in this First Amendment are included

herein for convenience of reference only and shall not constitute a part of

this First Amendment for any other purpose or be given any substantive effect.

D.            Applicable

Law.  THIS FIRST AMENDMENT

AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE GOVERNED BY,

AND SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE INTERNAL LAWS OF

THE STATE OF NEW YORK (INCLUDING WITHOUT LIMITATION SECTION 5-1401 OF THE

GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK), WITHOUT REGARD TO CONFLICTS

OF LAWS PRINCIPLES.

E.             Counterparts; Effectiveness. 

This First Amendment may be executed in any number of counterparts and

by different parties hereto in separate counterparts, each of which when so executed

and delivered shall be deemed an original, but all such counterparts together

shall constitute but one and the same instrument; signature pages may be

detached from multiple separate counterparts and attached to a single

counterpart so that all signature pages are physically attached to the same

document.  This First Amendment shall

become effective upon the execution of a counterpart hereof by the Borrower,

and the Lenders and each of the Credit Parties and receipt by the Borrower and

the Agent of written or telephonic notification of such execution and

authorization of delivery thereof.

[Remainder

of page intentionally left blank]

IN

WITNESS WHEREOF,

the parties hereto have caused this First Amendment to be duly executed and

delivered by their respective officers thereunto duly authorized as of the date

first written above.

	

  BORROWER:

  	

  RESORTQUEST INTERNATIONAL, INC.

  
	

   

  	

  a Delaware corporation

  
	

   

  	

   

  
	

   

  	

   

  
	

   

  	

  By:

  	

  /s/  David L. Levine

  
	

   

  	

   

  	

  Name:

  	

  David L. Levine

  
	

   

  	

   

  	

  Title:

  	

  Chairman

  
	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  
	

  GUARANTORS:

  	

  FIRST RESORT SOFTWARE, INC.,

  
	

   

  	

  a

  Colorado corporation

  
	

   

  	

   

  
	

   

  	

  ADVANTAGE VACATION HOMES BY STYLES,

  INC., a Delaware corporation

  
	

   

  	

   

  
	

   

  	

  STYLES ESTATES, LTD., INC., a Delaware

  corporation

  
	

   

  	

   

  
	

   

  	

  B&B ON THE BEACH, INC., a North

  Carolina corporation

  
	

   

  	

   

  
	

   

  	

  BRINDLEY & BRINDLEY REALTY &

  DEVELOPMENT, INC., a North Carolina corporation

  
	

   

  	

   

  
	

   

  	

  BLUEBILL PROPERTIES, INC., a Delaware

  corporation

  
	

   

  	

   

  
	

   

  	

  BLUEBILL VACATION PROPERTIES, INC., a Delaware

  corporation

  
	

   

  	

   

  
	

   

  	

  COATES, REID & WALDRON, INC., a Delaware

  corporation

  
	

   

  	

   

  
	

   

  	

  CRW PROPERTY MANAGEMENT, INC., a Delaware corporation

  
	

   

  	

   

  
	

   

  	

  COASTAL RESORTS REALTY, L.L.C., a Delaware

  limited liability company

  
	

   

  	

   

  
	

   

  	

  COASTAL RESORTS MANAGEMENT, INC., a Delaware

  corporation

  

 

	

   

  	

   

  
	

   

  	

  COLLECTION OF FINE PROPERTIES, INC., a Colorado

  corporation

  
	

   

  	

   

  
	

   

  	

  TEN MILE HOLDINGS, LTD., a Colorado

  corporation

  
	

   

  	

   

  
	

   

  	

  HOTEL CORPORATION OF THE PACIFIC,

  INC., a Hawaii corporation

  
	

   

  	

   

  
	

   

  	

  HOUSTON AND O’LEARY COMPANY, a Colorado

  corporation

  
	

   

  	

   

  
	

   

  	

  MAUI CONDOMINIUM & HOME REALTY,

  INC., a Hawaii corporation

  
	

   

  	

   

  
	

   

  	

  THE MAURY PEOPLE, INC., a Massachusetts

  corporation

  
	

   

  	

   

  
	

   

  	

  HOWEY ACQUISITION, INC., a Florida

  corporation

  
	

   

  	

   

  
	

   

  	

  PRISCILLA MURPHY REALTY, INC., a Florida

  corporation

  
	

   

  	

   

  
	

   

  	

  REALTY CONSULTANTS, INC., a Florida

  corporation

  
	

   

  	

   

  
	

   

  	

  RESORT PROPERTY MANAGEMENT, INC., a Utah

  corporation

  
	

   

  	

   

  
	

   

  	

  SHORELINE RENTALS, INC., a Delaware

  corporation

  
	

   

  	

   

  
	

   

  	

  TELLURIDE RESORT ACCOMMODATIONS, INC., a Colorado

  corporation

  
	

   

  	

   

  
	

   

  	

  TRUPP-HODNETT ENTERPRISES, INC., a Georgia

  corporation

  
	

   

  	

   

  
	

   

  	

  THE MANAGEMENT COMPANY, INC., a Georgia

  corporation

  
	

   

  	

   

  
	

   

  	

  WORTHY OWNER RENTAL GROUP, INC., a South

  Carolina corporation

  

 

	

   

  	

   

  
	

   

  	

  ABBOTT & ANDREWS REALTY, INC., a Florida

  corporation

  
	

   

  	

   

  
	

   

  	

  ABBOTT REALTY SERVICES, INC., a Florida

  corporation

  
	

   

  	

   

  
	

   

  	

  ABBOTT RESORTS, INC., a Florida corporation

  
	

   

  	

   

  
	

   

  	

  PLANTATION RESORT MANAGEMENT, INC., 

  a Delaware corporation

  
	

   

  	

   

  
	

   

  	

  THE TOPS’L GROUP, INC., a Florida corporation

  
	

   

  	

   

  
	

   

  	

  R & R RESORT RENTAL PROPERTIES, INC., a North Carolina corporation

  
	

   

  	

   

  
	

   

  	

   

  
	

   

  	

  (The following

  signature is on behalf of each of the foregoing Guarantors)

  
	

   

  	

   

  
	

   

  	

   

  
	

   

  	

  By:

  	

  /s/  David L. Levine

  
	

   

  	

   

  	

  Name:

  	

  David L. Levine

  
	

   

  	

   

  	

  Title:

  	

  Chairman

  

 

 

[Signatures Continued on Next Page]

 

	

  LENDERS:

  	

  CITIBANK, N.A.,

  
	

   

  	

  as Agent

  
	

   

  	

   

  
	

   

  	

   

  
	

   

  	

  By:

  	

  /s/  Nicolas T. Erni

  
	

   

  	

   

  	

  Name:

  	

  Nicolas T. Erni

  
	

   

  	

   

  	

  Title:

  	

  Director/VP

  
	

   

  	

   

  
	

   

  	

   

  
	

   

  	

  BANK OF AMERICA, N.A.,

  
	

   

  	

  as Documentation Agent,

  Existing Agent, a Lender and an Issuing Lender

  
	

   

  	

   

  
	

   

  	

   

  
	

   

  	

  By:

  	

   

  
	

   

  	

   

  	

  Name:

  
	

   

  	

   

  	

  Title:

  
	

   

  	

   

  
	

   

  	

   

  
	

   

  	

  CRÉDIT LYONNAIS NEW YORK BRANCH,

  
	

   

  	

  as Syndication Agent

  and a Lender

  
	

   

  	

   

  
	

   

  	

   

  
	

   

  	

  By:

  	

  /s/  David Bowers

  
	

   

  	

   

  	

  Name:

  	

  David Bowers

  
	

   

  	

   

  	

  Title:

  	

  Vice President

  
	

   

  	

   

  
	

   

  	

   

  
	

   

  	

  CITICORP NORTH AMERICA, INC.,

  
	

   

  	

  as a Lender and an

  Issuing Lender

  
	

   

  	

   

  
	

   

  	

   

  
	

   

  	

  By:

  	

  /s/  Nicolas T. Erni

  
	

   

  	

   

  	

  Name:

  	

  Nicolas T. Erni

  
	

   

  	

   

  	

  Title:

  	

  Director/VP

  
	

   

  	

   

  
	

   

  	

   

  
	

   

  	

  UNION PLANTERS BANK,

  
	

   

  	

  as a Lender

  
	

   

  	

   

  
	

   

  	

   

  
	

   

  	

  By:

  	

  /s/  Craig E. Gardella

  
	

   

  	

   

  	

  Name:

  	

  Craig E. Gardella

  
	

   

  	

   

  	

  Title:

  	

  Senior Vice President

  
								

Schedule 1

Exhibit 7.1(c)

 

FORM OF

OFFICER'S CERTIFICATE

 

 

TO:         CITIBANK, N.A., as Agent

390 Greenwich Street

New York, New York  10013

Attn:  Larry Farley

 

RE:          Amended and Restated Credit Agreement dated as of

January 22, 2001 among ResortQuest International, Inc., a Delaware corporation

(the “Borrower”), the Credit Parties party thereto, the Lenders named

therein, Citbank, N.A., as Agent, Bank of America, N.A., as Documentation

Agent, Crédit Lyonnais New York Branch, as Syndication Agent, and Salomon Smith

Barney Inc., as Arranger (as the same may be amended, modified, extended or

restated from time to time, the "Credit Agreement”)

 

DATE:    _____________, 20__

 

 

                Pursuant

to the terms of the Credit Agreement, I, ___________________, chief financial

officer of ResortQuest International, Inc. hereby certify on behalf of all the

Credit Parties that the statements below are accurate and complete in all

respects (all capitalized terms used below shall have the respective meanings

set forth in the Credit Agreement):

 

                                (a)           I have reviewed the terms of the

Credit Agreement and the terms of the other Credit Documents, and I have made,

or have caused to be made under my supervision, a review in reasonable detail

of the transactions and condition of the Consolidated Parties during the

accounting period covered by the attached financial statements.

 

                                (b)           Attached hereto as Schedule 1

are calculations demonstrating compliance by the Credit Parties with the

financial covenants contained in Section 7.11 of the Credit Agreement.

 

                                (c)           The examination described in

paragraph (a) above did not disclose, and we have no knowledge of, the

existence of any condition or event which constitutes a Default or Event of

Default under the Credit Agreement.

 

 

                                (d)           The monthly/quarterly/annual

financial statements for the fiscal month/quarter/year ended __________ which

accompany this certificate fairly present in all material respects the

financial condition of the Consolidated Parties or the Borrower and its

Subsidiaries, as applicable, and have been prepared in accordance with GAAP,

subject to changes resulting from audit and normal year-end audit adjustments.

 

	

   

  	

  RESORTQUEST INTERNATIONAL, INC.

  	

   

  
	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  
	

   

  	

  By:

  	

   

  	

   

  
	

   

  	

   

  	

  Name:

  	

   

  
	

   

  	

   

  	

  Title:

  	

   

  

 

SCHEDULE 1 TO

OFFICER'S CERTIFICATE

 

	

  1.

  	

  Fixed Charge

  Coverage Ratio

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

  (a)

  	

   

  	

  Consolidated EBITDA

  	

   

  	

  $

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

  (b)

  	

   

  	

  Consolidated Rent Expense

  	

   

  	

  $

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

  (c)

  	

   

  	

  [(a+(b])

  	

   

  	

  $

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

  (d)

  	

   

  	

  Consolidated Interest Expense

  	

   

  	

  $

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

  (e)

  	

   

  	

  Consolidated Scheduled Funded Debt Payments

  	

   

  	

  $

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

  (f)

  	

   

  	

  Consolidated Rent Expense

  	

   

  	

  $

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

  (g)

  	

   

  	

  Dividends

  	

   

  	

  $

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

  (h)

  	

   

  	

  Major Earnout Payments:

  	

   

  	

  $

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

  (i)

  	

   

  	

  Net Aston Guaranty Payments:

  	

   

  	

  $

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

  (i)

  	

   

  	

  [(d)+(e)+(f)+(g)+(h)+(i)]:

  	

   

  	

  $

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

  (k)

  	

   

  	

  Fixed Charge Coverage Ratio [(c)/(i)]:

  	

   

  	

  :1.0

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

  2.

  	

  Consolidated Leverage Ratio

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

  (a)

  	

   

  	

  Funded Indebtedness of the Consolidated Parties

  	

   

  	

  $

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

  (b)

  	

   

  	

  Consolidated EBITDA of the Consolidated Parties

  	

   

  	

  $

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

  (c)

  	

   

  	

  Consolidated Leverage Ratio [(a)/(b)]

  	

   

  	

  :1.0

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

  3.

  	

  Consolidated Net Worth

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

  (a)

  	

   

  	

  Actual Consolidated Net Worth as of the end of the

  fiscal period referred to above

  	

   

  	

  $

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

  (b)

  	

   

  	

  Base Consolidated Net Worth:

  	

   

  	

  $

  	

  90,000,000

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

  (c)

  	

   

  	

  .75 x cumulative Consolidated Net Income (to the

  extent positive) subsequent to the Closing Date

  	

   

  	

  $

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

  (d)

  	

   

  	

  Net Cash Proceeds from Equity Issuance subsequent to

  the Closing Date

  	

   

  	

  $

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

  (e)

  	

   

  	

  Consolidated Net Worth required by Section 7.11(c)

  [(b)+(c)+(d)]

  	

   

  	

  $

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

  4.

  	

  Consolidated Capital Expenditures

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

  (a)

  	

   

  	

  Consolidated Capital Expenditures for the twelve

  month period ending as of the end of the fiscal period referred to above:

  	

   

  	

  $

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

  (b)

  	

   

  	

  The lesser of $10,000,000 or 4% of

  Consolidated Revenues of the Consolidated Parties

  	

   

  	

  $

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

  (c)

  	

   

  	

  Software Expenditures for period commencing on June

  30, 2000 and ending as of the end of the fiscal period referred to above:

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

  $

  	

   

  	

   

  
	

  5.

  	

  Consolidated Capital Expenditures for Calendar Year

  2002

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

  (a)

  	

   

  	

  Consolidated Capital Expenditures for the period

  commencing January 1, 2002 and ending as of the end of  the fiscal period referred to above,

  allocable to each of the following categories:

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

  (i)

  	

  Property maintenance:

  	

   

  	

  $

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

  (ii)

  	

  Corporate headquarters, centralized offices and

  information technology:

  	

   

  	

  $

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

  (b)

  	

   

  	

  Amount in 5(a)(i) allocable to a new call center:

  	

   

  	

  $

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

  (c)

  	

   

  	

  Software Expenditures for period commencing on June

  30, 2000 and ending as of the end of the fiscal period referred to above:

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

  $

  	

   

  	

   

  
	

  6.

  	

  Minimum Consolidated EBITDA for Period 10/01/01 to

  12/31/01 and Calendar Year 2002

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

  (a)

  	

   

  	

  Consolidated EBITDA of the Consolidated Parties

  ending as of the end of the fiscal period referred to above:

  	

   

  	

  $

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00031-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00031-of-00352.parquet"}]]