EXHIBIT 99.1
AMENDMENT NO. 5 TO GUARANTEE AGREEMENT
AMENDMENT NO. 5 TO GUARANTEE AGREEMENT, dated as of July 21, 2023 (this “Amendment”), between ACRES COMMERCIAL REALTY CORP, f/k/a Exantas Capital Corp., a Maryland corporation (“Guarantor”), and JPMORGAN CHASE BANK, NATIONAL ASSOCIATION, a national banking association (“Buyer”). Capitalized terms used but not otherwise defined herein shall have the meanings given to them in the Repurchase Agreement (as defined below).
RECITALS
WHEREAS, RCC REAL ESTATE SPE 8, LLC (“Seller”) and Buyer are parties to that certain Uncommitted Master Repurchase Agreement, dated as of October 26, 2018 (as amended by that certain First Amendment to Uncommitted Master Repurchase Agreement, dated as of August 14, 2020, as further amended by that certain Amendment No. 2 to Master Repurchase Agreement, dated as of September 1, 2021, as further amended by that certain Amendment No. 3 to Master Repurchase Agreement and Guarantee Agreement, dated as of October 26, 2021, as further amended by that certain Term SOFR Conforming Changes Amendment, dated as of December 31, 2021, as further amended by that certain Amendment No. 4 to Master Repurchase Agreement, dated as of July 21, 2023, as amended hereby, and as may be further amended, restated, supplemented or otherwise modified and in effect from time to time, the “Repurchase Agreement”);
WHEREAS, in connection with the Repurchase Agreement, Guarantor entered into that certain Guarantee Agreement, dated as of October 26, 2018 (as amended by that certain Amendment No. 1 to Guarantee Agreement, dated as of May 6, 2020, as further amended by that certain Amendment No. 2 to Guarantee Agreement, dated as October 2, 2020, as further amended by that certain Amendment No. 3 to Master Repurchase Agreement and Guarantee Agreement, dated as of October 26, 2021, as further amended by that certain Amendment No. 4 to Guarantee Agreement, dated as of November 17, 2022, as amended hereby, and as may be further amended, restated, supplemented or otherwise modified and in effect from time to time, the “Guarantee Agreement”); and
WHEREAS, Guarantor and Buyer have agreed to amend certain provisions of the Guarantee Agreement in the manner set forth herein.
NOW THEREFORE, in consideration of the premises and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Guarantor and Buyer agree as follows:
“(i) At all times, Guarantor shall maintain unpledged, unencumbered Liquidity of (1) from the Closing Date through October 25, 2021, not less than the greater of (A) $10,000,000 and (B) ten percent (10%) of the aggregate outstanding Repurchase Price of all Purchased Assets as of such time; (2) from October 26, 2021 through September 30, 2022, not less than the greater of (A) $10,000,000 and (B) five percent (5%) of the aggregate outstanding Repurchase Price of all Purchased Assets as of such time; (3) from October 1, 2022 through December 31, 2024, not less than the greater of (A) $15,000,000 and (B) seven and a half percent (7.5%) of the aggregate outstanding Repurchase Price of all Purchased Assets as of such time; and (4) from and after January 1, 2025, not less than the greater of (A) $10,000,000 and (B) five percent (5%) of the aggregate outstanding Repurchase Price of all Purchased Assets as of such time.”
“(iii) Guarantor shall not permit, for any Test Period, the ratio of its Total Indebtedness to its Total Equity to be (1) from the Closing Date through the calendar quarter ending September 30, 2022, greater than 6.00 to 1.00; (2) from calendar quarter ending December 31, 2022 through the calendar quarter ending December 31, 2024, greater than 5.50 to 1.00; and (3) at all times after the calendar quarter ending December 31, 2024, greater than 6.00 to 1.00. For the avoidance of doubt, any calculation of Total Indebtedness will include any and all recourse and non-recourse debt of any Consolidated Subsidiary of Guarantor.”
“(v) Guarantor shall not permit, for any Test Period, the ratio of (i) the sum of the trailing four (4) fiscal quarters EBITDA for Guarantor and its Consolidated Subsidiaries for such Test Period to (ii) the trailing four (4) fiscal quarters Interest Expense for Guarantor and its Consolidated Subsidiaries for such Test Period to be (1) from the Closing Date through the calendar quarter ending September 30, 2022, less than 1.50 to 1.00; (2) from the calendar quarter ending December 31, 2022 through the calendar quarter ending December 31, 2024, less than 1.25 to 1.00; and at all times after the calendar quarter ending December 31, 2024, less than 1.50 to 1.00.”
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The parties hereto hereby irrevocably consent to the service of any summons and complaint and any other process by the mailing of copies of such process to them at their respective address specified in the Guarantee Agreement. The parties hereto hereby agree that a final judgment in any such action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law. Nothing in this Section 9 shall affect the right of Buyer to serve legal process in any other manner permitted by law or affect the right of Buyer to bring any action or proceeding against Guarantor or its property in the courts of other jurisdictions.
[SIGNATURE PAGES FOLLOW]
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed and delivered as of the day and year first above written and effective as of the Amendment Effective Date.
ACRES COMMERCIAL REALTY CORP, f/k/a Exantas Capital Corp., a Maryland corporation
By: | /s/ Michael Pierro |
| Name: Michael Pierro |
| Title: Senior Vice President |
JPMORGAN CHASE BANK, NATIONAL ASSOCIATION, a national banking association
By: | /s/ Thomas N. Cassino |
| Name: Thomas N. Cassino |
| Title: Managing Director |