EXHIBIT 99.B
$40,000,000 CREDIT AGREEMENT
U.S. $40,000,000
AMENDED AND RESTATED CREDIT AGREEMENT
Dated as of December 19, 1997
By and Among
VICORP RESTAURANTS, INC.
as the Borrower
and
NATIONSBANK OF TEXAS, N.A.
as the Agent for the Lenders and as a Lender
and
U.S. BANK NATIONAL ASSOCIATION,
D/B/A COLORADO NATIONAL BANK
as a Lender
TABLE OF CONTENTS
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Page
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ARTICLE I DEFINITIONS AND ACCOUNTING TERMS..................1
1.01 Certain Defined Terms ...............................1
1.02 Computation of Time Periods ........................11
1.03 Accounting Terms; Fiscal Periods ...................11
1.04 Other Definitional Provisions.......................11
ARTICLE II THE FACILITIES AND COMMITMENTS..................11
2.01 The Facilities......................................12
2.02 The Advance Commitment..............................12
2.03 The Letter of Credit Commitment.....................12
2.04 Fees................................................12
2.05 Reduction of the Commitment.........................12
2.06 Payments and Computations...........................12
2.07 Increased Capital or Costs and Reduced Return.......13
2.08 Interest Rate Contracts.............................14
ARTICLE III THE ADVANCE FACILITY...........................14
3.01 The Advances........................................14
3.02 Making the Advances.................................15
3.03 Conversion or Continuation of Advances..............16
3.04 Additional Provisions Applicable to Eurodollar
Rate Advances.......................................17
3.05 Notes; Repayment....................................19
3.06 Interest............................................19
3.07 Additional Interest on Eurodollar Rate Advances.....20
3.08 Pre-payments........................................20
3.09 Maximum Interest Rate...............................21
3.10 Interest Recapture..................................21
3.11 Extension of Maturity...............................22
ARTICLE IV THE LETTER OF CREDIT FACILITY...................22
4.01 The Letters of Credit...............................22
4.02 Amounts and Terms...................................22
4.03 Conditions..........................................22
4.04 Issuing Letters of Credit...........................23
4.05 Paying under Letters of Credit......................23
4.06 Reimbursement Obligations...........................23
4.07 Compensation for Letters of Credit..................24
4.08 Sharing of Payments.................................24
4.09 Documentation.......................................25
4.10 Indemnification; Exoneration........................25
4.11 Termination of Letters of Credit; Cash Collateral...26
ARTICLE V CONDITIONS OF EXTENSIONS OF CREDIT...............26
5.01 Conditions Precedent to Initial Extension of
Credit..............................................26
5.02 Conditions Precedent to Each Extension of Credit,
Conversion or Continuation..........................26
ARTICLE VI REPRESENTATIONS AND WARRANTIES..................27
6.01 Representations and Warranties of the Borrower......27
ARTICLE VII COVENANTS OF THE BORROWER......................29
7.01 Affirmative Covenants...............................29
7.02 Negative Covenants..................................32
7.03 Financial Covenants.................................36
ARTICLE VIII EVENTS OF DEFAULT.............................37
8.01 Events of Default...................................37
ARTICLE IX MISCELLANEOUS...................................39
9.01 Amendments, Etc.....................................39
9.02 Notices, Etc........................................39
9.03 No Waiver; Remedies.................................40
9.04 Payments Set Aside..................................40
9.05 Costs, Expenses and Taxes...........................40
9.06 Right of Set-Off....................................41
9.07 Sharing of Payments.................................42
9.08 Indemnification.....................................42
9.09 Change in Accounting Principles.....................43
9.10 The Agent's Performance of Defaulted Acts...........43
9.11 Binding Effect; Assignments; Participations.........43
9.12 CHOICE OF LAW.......................................44
9.13 CONSENT TO JURISDICTION.............................44
9.14 WAIVER OF JURY TRIAL................................44
9.15 Term................................................45
9.16 Execution in Counterparts...........................45
9.17 Lenders' Creation of Security Interest..............45
ARTICLE X THE AGENT........................................45
10.01 Appointment........................................45
10.02 Agent's Reliance. Etc..............................45
10.03 NationsBank and Affiliates.........................46
10.04 Lender Credit Decision.............................46
10.05 Indemnification....................................46
10.06 Successor Agent....................................47
10.07 Invalidated Payments...............................47
EXHIBITS & SCHEDULES
--------------------
Exhibit A - Form of Notice of Borrowing
Exhibit B - Form of Notice of Conversion/Continuation
Exhibit C - Form of Revolving Loan Note
Exhibit D - Form of Request for Letters of Credit
Exhibit E - Form of Opinion of Counsel to the Borrower
Exhibit F - List of Closing Documents
Schedule 6.01(a) - Tradenames
Schedule 7.02(a) - Permitted Existing Liens.
Schedule 7.02(b) - Permitted Existing Debt
Schedule 7.02(h) - Permitted Dispositions
AMENDED AND RESTATED CREDIT AGREEMENT
This Amended and Restated Credit Agreement is made as of December 19, 1997, by
and among VICORP Restaurants, Inc., a Colorado corporation with an office
located at ▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇.▇. ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ (the
"Borrower"), the banks or other financial institutions listed on the signature
pages hereof (such banks or other financial institutions and their respective
successors and assigns being referred to collectively as the "Lenders"), and
NationsBank of Texas, N.A., a national banking association ("NationsBank"), as
agent for the Lenders (in such capacity, the "Agent") (said Amended and Restated
Credit Agreement, as the same may be amended, modified or supplemented from time
to time, being hereafter referred to as the "Amended and Restated Agreement").
RECITALS
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WHEREAS, the Borrower, the Agent and the Lenders are party to that certain
Credit Agreement dated as of October 31, 1996 (as amended, the "Existing
Agreement"); and
WHEREAS, the Borrower has requested various modifications to the Existing
Agreement, including, without limitation, an increase in the amount of the
available credit and an extension of the maturity therefor;
NOW, THEREFORE, in consideration of the foregoing and the mutual covenants
contained herein, and for other good and valuable consideration, the receipt and
adequacy of which are hereby acknowledged, the Borrower, the Lenders and the
Agent agree that the Existing Agreement is hereby amended and restated in its
entirety as follows:
ARTICLE I
DEFINITIONS AND ACCOUNTING TERMS
SECTION 1.01 Certain Defined Terms. As used in this Amended and Restated
Agreement, the following capitalized terms shall have the following meanings
(such meanings to be equally applicable to both the singular and plural form of
the terms defined):
"Adjusted Consolidated EBITDAR" means, for any period with respect to the
Borrower and its subsidiaries, the sum of the amounts for such period, of (i)
Operating Income, plus (ii) depreciation, amortization and other non-cash
charges deducted in computing operating income, plus (iii) Consolidated Rental
Payments.
"Adjusted Debt" means, as of the last day of any fiscal quarter, with respect
to the Borrower and its subsidiaries, the sum of (i) Consolidated Funded Debt,
plus (ii) Capital Lease Obligations, minus (iii) the aggregate outstanding
principal balance of any subordinated debt, plus (iv) the product of Operating
Lease expense for the four fiscal quarters ending on the date of determination
times eight.
"Advance" means an advance by any Lender to the Borrower pursuant to Article
III, and refers to a Base Rate Advance or a Eurodollar Rate Advance (each of
which shall be
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a "Type" of Advance).
"Advance Commitment" has the meaning specified in Section 2.02.
"Advance Facility" has the meaning specified in Section 2.01.
"Affiliate" means, with respect to any Person, anyother Person controlled by,
controlling or under common control with such Person, whether such control be
direct or indirect. All of the Borrower's officers, shareholders holding in
excess of five percent (5%) of any class of capital stock of the Borrower,
directors, subsidiary corporations, joint ventures and partners shall be deemed
to be the Borrower's Affiliates for purposes of this Amended and Restated
Agreement.
"Aggregate Commitment" means $40,000,000, as such amount may be reduced from
time to time pursuant to the terms of this Amended and Restated Agreement.
"Aggregate Outstandings" means, at any time, the sum of(i) the aggregate
principal amount of the Advances outstanding at such time, plus (ii) the
aggregate Letter of Credit Obligations at such time.
"Alternate Base Rate" means, for any day, the greater of (a) the sum of the
Federal Funds Rate plus 0.5%, or (b) the annual interest rate most recently
announced by Agent as its prime rate (or, if the Person then acting as Agent
under this Amended and Restated Agreement is not a bank organized under the Laws
of the United States or any State, then the rate announced by NationsBank of
Texas, N.A. as its prime rate) in effect at its principal office, automatically
fluctuating upward and downward with and as specified in each announcement
without special notice to Borrower or any other Person (which prime rate may not
necessarily represent the lowest or best rate actually charged to a customer).
"Applicable Commitment Fee" means, on any day, thecommitment fee percentage
based on the ratio of debt to capitalization, calculated as set forth in the
definition of "Applicable Margin", as follows:
Applicable
Ratio of debt to capitalization Commitment Fee
Percentage
-----------------------------------------------------------
Greater than or equal to 0.20 to 1.0 0.375%
Less than 0.20 to 1.0 0.250%
"Applicable Lending Office" means, with respect to each Lender, such Lender's
Domestic Lending Office, in the case of a Base Rate Advance, and such Lender's
Eurodollar Lending Office, in the case of a Eurodollar Rate Advance.
"Applicable Margin" means, on any day, the interestmargin over the Eurodollar
Rate, based on a ratio of debt to capitalization, as follows:
Applicable
Margin for
Ratio of debt to capitalization Eurodollar Rate
Advances
2
--------------------------------------------------------
Greater than or equal to 0.30 to 1.0 1.625%
Less than 0.30 to 1.0 but 1.500%
greater than or equal to 0.20to 1.0
Less than 0.20 to 1.0 but 1.250%
greater than or equal to 0.15 to 1.0
Less than 0.15 to 1.0 1.000%
For purposes of determining the Applicable Margin, (i) the ratio of debt to
capitalization shall be the ratio of (i) the sum of (A) Consolidated Funded
Debt, plus (B) Capital Lease Obligations of the Borrower and its subsidiaries,
to (ii) the sum of (x) Consolidated Funded Debt, plus (y) Consolidated Net
Worth, plus (z) Capital Lease Obligations of the Borrower and its subsidiaries,
and shall be calculated quarterly as of the last day of the fiscal quarter for
which the most recent quarterly financial statements have been delivered
pursuant to Section 7.01(b), and shall apply to all Advances made on or after
the date such financial statements are delivered, until recalculated in
accordance with this paragraph. If Borrower fails to furnish Agent any such
financial statements (or the related compliance certificate) when required
pursuant to Section 7.02(b), then the highest applicable margin identified above
shall apply to all subsequent Advances until Borrower furnishes the required
financial statements and compliance certificate. The initial calculation as of
the Closing Date shall be based upon the financial statements dated as of July
31, 1997.
"Bankruptcy Code" means Title 11 of the United States Code (11 U.S.C. 101 et
seq.), as amended from time to time.
"Base Rate Advance" means an Advance that bears interest as provided in
Section 3.06(a).
"Benefit Plan" means an employee benefit plan as defined in Section 3(35) of
ERISA (other than a Multi-employer Plan) in respect of which the Borrower or any
ERISA Affiliate is, or within the immediately preceding six (6) years was, an
"employer" as defined in Section 3(5) of ERISA.
"Borrowing" means a borrowing consisting of one or more Advances of the same
Type made on the same day by the Lenders.
"Business Day" means a day of the year on which banks are not required or
authorized to close in Dallas, Texas, and if the applicable Business Day relates
to any Eurodollar Rate Advance, a day of the year on which dealings are carried
on in the London interbank market.
"Capital Lease" means, as applied to any Person, any lease of any property
(whether real, personal or mixed) by that Person as lessee that, in conformity
with GAAP, is or should be accounted for as a capital lease on the balance sheet
of such Person.
"Capital Lease Obligations" means, as applied to any Person, the obligations
of such Person as lessee under leases that are Capital Leases.
"Commitment" means, with respect to each Lender at any
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time, such Lender's Pro Rata Share of the Aggregate Commitment at such time.
"Consolidated Capital Expenditures" means, for anyperiod, the aggregate of all
Permitted Asset Acquisitions and other expenditures (whether paid in cash or
accrued as liabilities during that period and including that portion of Capital
Leases that is capitalized on the consolidated balance sheet of the Borrower and
its subsidiaries) by the Borrower or any of its subsidiaries during such period
that, in conformity with GAAP, are required to be included in the property,
plant and equipment or similar fixed asset accounts in the consolidated balance
sheet of the Borrower and its subsidiaries (including equipment which is
purchased simultaneously with the trade-in of existing equipment owned by the
Borrower or any such subsidiary to the extent of the gross amount of such
purchase price less the book value (net of accumulated depreciation) of the
equipment being traded in at such time), but excluding expenditures made in
connection with the replacement or restoration of assets, to the extent
reimbursed or financed from insurance proceeds paid on account of the loss of or
damage to the assets being replaced or restored or from awards of compensation
arising from the taking by condemnation or eminent domain of such assets being
replaced.
"Consolidated Fixed Charges" means, for any period, (i) consolidated gross
cash payments of interest expense (including the interest component of Capital
Leases) of the Borrower and its subsidiaries, including, without limitation, all
commissions, discounts and other fees and charges owed with respect to letters
of credit, all as determined in conformity with GAAP, plus (ii) Consolidated
Rental Payments for such period, plus (iii) all scheduled principal payments
required to be made by the Borrower or any of its subsidiaries during such
period with respect to any Debt.
"Consolidated Funded Debt" means, as at any date of determination, all
interest bearing indebtedness, obligations and other liabilities of the Borrower
and its subsidiaries for borrowed money or evidenced by bonds, debentures,
acceptances, notes or other similar instruments (whether such interest arises as
a result of accrual or accretion).
"Consolidated Net Worth" means, as at any date of determination, the amount by
which consolidated total assets of the Borrower and its subsidiaries, determined
in conformity with GAAP, exceed consolidated total liabilities of the Borrower
and its subsidiaries, determined in conformity with GAAP.
"Consolidated Rental Payments" means, for any period,the aggregate amount of
all rents paid or accrued (net of sublease rents paid or accrued) under all
Operating Leases of the Borrower or any of its consolidated subsidiaries as
lessee, as determined in conformity with GAAP.
"Consolidated Tangible Net Worth" means at any time, the sum of (i)
Consolidated Net Worth, at such time, minus (ii) the aggregate amount, at such
time (on a consolidated basis for the Borrower and its subsidiaries), of any
intangible assets, including, without limitation, patents, trademarks, service
marks, good will, rights and claims against carriers and shippers, trade names,
rights to refunds and indemnification, and any other asset that would
4
be classified as an intangible under GAAP other than leasehold rights.
"Contaminant" means any waste, pollutant, hazardoussubstance, toxic substance,
hazardous waste, special waste, petroleum or petroleum-derived substance or
waste, or any constituent of any such substance or waste.
"Conversion Date" means, with respect to any Advance, the date that such
Advance, if a Base Rate Advance, is converted into a Eurodollar Rate Advance,
or, if a Eurodollar Rate Advance, is converted into a Base Rate Advance, in
either case in accordance with the procedures described in Section 3.03.
"Costs and Expenses" has the meaning specified in Section 9.05.
"Debt" means, as applied to any Person, (i) indebtedness for borrowed money of
such Person, (ii) obligations of such Person evidenced by bonds, debentures,
notes or other similar instruments, (iii) obligations of such Person to pay the
deferred purchase price of property or services, except trade accounts payable
and accrued expenses arising in the ordinary course of business but only if and
so long as the same are payable on available trade terms, (iv) Capital Lease
Obligations of such Person, (v) obligations of such Person under direct or
indirect guaranties in respect of, and obligations (contingent or otherwise) to
purchase or otherwise acquire, or otherwise to assure a creditor against loss in
respect of, indebtedness or obligations of others of the kinds referred to in
clauses (i) through (iv) above, and (vi) liabilities of such Person in respect
of unfunded vested benefits under Benefit Plans.
"Default" means an event which with the lapse of time
or the giving of notice or both would constitute an Event of
Default.
"Domestic Lending Office" means, with respect to each Lender, the office of
such Lender specified as such Lender's "Domestic Lending Office" on the
signature pages hereof or such other office as such Lender may from time to time
specify to the Borrower and the Agent.
"DOL" means the United States Department of Labor and any Person succeeding to
the functions thereof.
"Eligible Interest Rate Contract" has the meaning specified in Section 2.08.
"ERISA" means the Employee Retirement Income Security Act of 1974, any
amendments thereto, any successor statute, and any regulations or guidance
promulgated thereunder.
"ERISA Affiliate" means any (i) corporation which is a member of the same
controlled group of corporations (within the meaning of Section 414(b) of the
IRC) as the Borrower, (ii) partnership or other trade or business (whether or
not incorporated) under common control (within the meaning of Section 414(c) of
the IRC) with the Borrower, or (iii) member of the same affiliated service group
(within the meaning of Section 414(m) of the IRC) as the Borrower, any
corporation described in clause (i) above or any partnership or trade or
business described in clause (ii) above.
"Eurocurrency Liabilities" has the meaning assigned to
5
that term in Regulation D of the Board of Governors of the Federal Reserve
System, as in effect from time to time.
"Eurodollar Lending Office" means, with respect to each Lender, the office of
such Lender specified as such Lender's "Eurodollar Lending Office" on the
signature pages hereof, or such other office as such Lender may from time to
time specify to the Borrower and the Agent.
"Eurodollar Rate" means, for any Eurodollar Rate Advance for any Interest
Period therefor, the rate per annum (rounded upwards, if necessary, to the
nearest 1/100 of 1%) appearing on Telerate Page 3750 (or any successor page) as
the London interbank offered rate for deposits in Dollars at approximately 11:00
a.m. (London time) two Business Days prior to the first day of such Interest
Period for a term comparable to such Interest Period. If for any reason such
rate is not available, the term "Eurodollar Rate" shall mean, for any Eurodollar
Rate Advance for any Interest Period therefor, the rate per annum (rounded
upwards, if necessary, to the nearest 1/100 of 1%) appearing on Reuters Screen
LIBO Page as the London interbank offered rate for deposits in Dollars at
approximately 11:00 a.m. (London time) two Business Days prior to the first day
of such Interest Period; provided, however, that if more than one rate is
specified on Reuters Screen LIBO Page, the applicable rate shall be the
arithmetic mean of all such rates.
"Eurodollar Rate Advance" means an Advance which bears interest as provided in
Section 3.06(b).
"Eurodollar Rate Reserve Percentage" means, with respect to each Lender, for
any Interest Period for any Eurodollar Rate Advance, the reserve percentage
applicable during such Interest Period (or if more than one such percentage
shall be so applicable, the daily average of such percentages for those days in
such Interest Period during which any such percentage shall be so applicable),
with respect to such Lender, under regulations issued from time to time by the
Board of Governors of the Federal Reserve System (or any successor) for
determining the maximum reserve requirement (including, without limitation, any
emergency, supplemental or other marginal reserve requirement), if any, for such
Lender, with respect to liabilities or assets consisting of or including
Eurocurrency Liabilities having a term equal to such Interest Period.
"Event of Default" has the meaning specified in Section 8.01.
"Existing Agreement" has the meaning specified in the Recitals.
"Federal Funds Rate" means, for any period, a fluctuating interest rate per
annum equal for each day during such period to the weighted average of the rates
on overnight federal funds transactions with members of the Federal Reserve
System arranged by federal funds brokers, as published for such day (or, if such
day is not a Business Day, for the immediately preceding Business Day) by the
Federal Reserve Bank of New York, or, if such rate is not so published for any
day which is a Business Day, the average of the quotations for such day on such
transactions received by the Agent from three federal funds brokers of
recognized standing selected by it.
6
"Final Order" has the meaning specified in Section 9.08(a).
"GAAP" means generally accepted accounting principles set forth in the rules,
regulations, statements, opinions and pronouncements of the American Institute
of Certified Public Accountants and the Financial Accounting Standards Board (or
agencies with similar functions and of comparable stature and authority within
the accounting profession), which are applicable to the circumstances as of the
date of determination.
"Governmental Acts" has the meaning specified in Section 4.10(a).
"Governmental Authority" means any nation or government, any federal, state,
city, town, municipality, county, local or other political subdivision thereof
or thereto and any department, commission, board, bureau, instrumentality,
agency or other entity exercising executive, legislative, judicial, regulatory
or administrative functions of or pertaining to government.
"Indemnified Parties" has the meaning specified in Section 9.08(a).
"Interest Period" means, for each Eurodollar Rate Advance, a period of one
(1), two (2), three (3), or six (6) months, as the Borrower may select, upon
notice received by the Agent not later than noon (Dallas time) on the third
Business Day prior to the first day of such period, and commencing on the date
of such Advance, the date of continuation of such Advance pursuant to Section
3.03 or the date of conversion of a Base Rate Advance pursuant to Section 3.03;
provided, however, that:
(i) the aggregate principal amount of all Advances having Interest Periods
ending after any Principal Repayment Date shall not exceed the principal
amount of all Advances permitted to be outstanding after giving effect to the
principal payments to be made on or prior to such Principal Repayment Date;
(ii) the Borrower may not select any Interest Period that ends after the
Maturity Date;
(iii) Interest Periods commencing on the same date for Advances shall be of
the same duration; and
(iv) whenever the last day of any Interest Period would otherwise occur on a
day other than a Business Day, the last day of such Interest Period shall be
extended to occur on the next succeeding Business Day, provided, however, that
if such extension would cause the last day of such Interest Period to occur in
the next following calendar month, the last day of such interest Period shall
occur on the next preceding Business Day.
"Interest Period Expiration Date" means the last day of any Interest Period
for any Eurodollar Rate Advance.
"Interest Rate Contracts" means interest rate swap agreements, interest rate
collar agreements, options on any of the foregoing, or any other agreements or
arrangements designed to provide protection against fluctuations in interest
rates.
7
"IRC" means the Internal Revenue Code of 1986, as amended to the date hereof
and from time to time hereafter, any successor statute and any regulations or
guidance promulgated thereunder.
"IRS" means the Internal Revenue Service and any Person succeeding to the
functions thereof.
"Letter of Credit" means any letter of credit issued under this Amended and
Restated Agreement upon the application of, and for the account of, the
Borrower.
"Letter of Credit Application" means, with respect to a Letter of Credit, such
form of application therefor and form of reimbursement agreement therefor
(whether in a single or several documents) as the Agent may employ in the
ordinary course of its business for its own account without requirement of
collateral security.
"Letter of Credit Commitment" has the meaning specified in Section 2.03.
"Letter of Credit Facility" has the meaning specified in Section 2.01.
"Letter of Credit Fee" has the meaning specified in Section 4.07.
"Letter of Credit Obligations" means, at any time, the sum of (i) the
aggregate Reimbursement Obligations at such time, plus (ii) the maximum
aggregate amount available for drawing under Letters of Credit at such time.
"Letter of Credit Rate" has the meaning specified in Section 4.07.
"Lien" means any mortgage, deed of trust, pledge, hypothecation, assignment,
deposit arrangement, security arrangement, security interest, encumbrance for
the payment of money, lien (statutory or other), preference, priority or other
security agreement or preferential arrangement of any kind or nature whatsoever.
"Loan Documents" means this Amended and Restated Agreement, the Notes, and
each of the other instruments, documents and agreements executed and/or
delivered by the Borrower in connection herewith and therewith (including,
without limitation, Letter of Credit Applications).
"Majority Lenders" means those Lenders whose Pro Rata Shares aggregate
66 2/3%.
"Maturity Date" means February 28, 2001.
"Maximum Amount" and "Maximum Rate" respectively mean, for a Lender, the
maximum non-usurious amount and the maximum non-usurious rate of interest that,
under applicable law, such Lender is permitted to contract for, charge, take,
reserve or receive on the Obligations.
"Multiemployer Plan" means a Plan maintained pursuant to a collective
bargaining agreement or any other arrangement to which the Borrower or any ERISA
Affiliate is a party and to which more than one employer is obligated to make
contributions.
8
"NationsBank Agreement" means the $5,000,000 Credit Agreement between the
Borrower and NationsBank, dated as of October 31, 1996, as amended.
"Net Equity Issuance Proceeds" means the net cash proceeds received by the
Borrower or any of its subsidiaries from the issuance and sale of equity
securities.
"Note" has the meaning specified in Section 3.05.
"Notice of Borrowing" has the meaning specified in Section 3.02(a).
"Notice of Continuation or Conversion" has the meaning specified in Section
3.03(b).
"Obligations" means and includes all loans, advances, debts, liabilities,
obligations, covenants and duties owing to the Agent or any of the Lenders from
the Borrower of any kind or nature, present or future, arising under any of the
Loan Documents, whether or not for the payment of money, whether arising by
reason of an extension of credit, opening of a letter of credit, loan, guaranty,
indemnification or in any other manner, whether direct or indirect, absolute or
contingent, due or to become due, now existing or hereafter arising and the
performance obligations of the Borrower under any Eligible Interest Rate
Contracts. The term "Obligations" includes, without limitation, the principal
amount of all Advances and Reimbursement Obligations, interest, charges,
expenses, fees, attorneys' and paralegals' fees and any other sums chargeable to
the Borrower under this Amended and Restated Agreement.
"Operating Income" means earnings before interest expenses, taxes and
extraordinary gains and losses, calculated in accordance with GAAP.
"Operating Lease" means, as applied to any Person, any lease of any property
(whether real, personal or mixed) by that Person as lessee which is not a
Capital Lease.
"PBGC" means the Pension Benefit Guaranty Corporation and any Person
succeeding to the functions thereof.
"Permitted Asset Acquisition" means (a) any acquisition in any fiscal year by
the Borrower from any of the Borrower's franchisees of the franchise granted by
the Borrower to such franchisee and all or substantially all of the assets of
such franchisee associated with such franchise, (b) any acquisition by the
Borrower of all or substantially all of the assets of any Person, other than a
subsidiary of the Borrower, in any fiscal year, and (c) any acquisition by the
Borrower of the capital stock or ownership interests of any other Person in any
fiscal year, provided that the aggregate consideration paid by the Borrower in
connection with all acquisitions permitted pursuant to clauses (a), (b) and (c)
above in such fiscal year may not exceed $10,000,000, and shall be included in
Consolidated Capital Expenditures for such fiscal year.
"Permitted Existing Debt" means the Debt of the Borrower or any of its
subsidiaries reflected on Schedule 7.02(b).
"Permitted Existing Liens" means the Liens against property of the Borrower or
any of its subsidiaries reflected on Schedule 7.02(a).
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"Permitted Franchisee Guarantees" means any guarantee by the Borrower of
obligations of any of the Borrower's franchisees arising in connection with the
operation or maintenance of such franchisee's franchise so long as the aggregate
amount of all such franchisee obligations guaranteed by the Borrower at any time
does not exceed $10,000,000.
"Person" means an individual, partnership, corporation (including a business
trust), joint stock company, trust, unincorporated association, joint venture or
other entity, or a government or any political subdivision or agency thereof.
"Plan" means an employee pension benefit plan that is covered by Title IV of
ERISA or subject to the minimum funding standards under Section 412 of the IRC
as to which the Borrower or any ERISA Affiliate may have any liability.
"Principal Repayment Date" means any date on which an installment of the
aggregate outstanding principal amount of the Advances is due under the Notes.
"Pro Rata Share" means, with respect to any Lender, the percentage specified
on the signature pages hereto or as hereafter specified in the documentation
governing any assignments of such Lender's Commitment.
"Rate Adjustment Period" means a period (i) commencing on the first day of the
month next succeeding the date that the Agent receives internal financial
statements acceptable to it demonstrating that the Borrower has maintained, for
two (2) consecutive fiscal quarters, the Required Rate Adjustment Level, and
(ii) continuing for so long as the Borrower continues to maintain such Required
Rate Adjustment Level.
"Reimbursement Obligation" has the meaning specified in Section 4.06.
"Reportable Event" means any of the events described in Section 4043 of ERISA
or the regulations issued thereunder.
"Request for Letters of Credit" has the meaning specified in Section 4.04.
"Required Rate Adjustment Level" means a ratio of Adjusted Consolidated
EBITDAR to Consolidated Fixed Charges, measured as of the end of the most
recently ended fiscal quarter for the period of four fiscal quarters ending on
such date, of at least 2.25 to 1.
"SEC" means the Securities and Exchange Commission and any successor agency.
"Single Employer Plan" means a Plan maintained by the Borrower or any ERISA
Affiliate for employees of the Borrower or such ERISA Affiliate.
"Taxes" means, for any Person, taxes, assessments or other governmental
charges or levies imposed upon it, its income, or any of its properties,
franchises or assets.
"Termination Date" means the earliest to occur of (i) the Maturity Date, (ii)
the termination in whole of the Commitments pursuant to Section 8.01, or (iii)
the
10
termination in whole of the Advance Commitment pursuant to Section 2.05.
"Termination Event" means (i) with respect to a Benefit Plan, a Reportable
Event, or (ii) the withdrawal of the Borrower or any ERISA Affiliate from a
Benefit Plan during a plan year in which it was a "substantial employer" as
defined in Section 4001(a)(2) of ERISA, or (iii) the imposition of an obligation
on the Borrower or any ERISA Affiliate under Section 4041 of ERISA to provide
affected parties written notice of intent to terminate a Benefit Plan in a
distress termination described in Section 4041(c) of ERISA, or (iv) the
institution of proceedings to terminate a Benefit Plan by the PBGC, or (v) any
other event or condition that might constitute grounds under Section 4042 of
ERISA for the termination of, or the appointment of a trustee to administer, any
Benefit Plan, or (vi) the partial or complete withdrawal of the Borrower or any
ERISA Affiliate from a Multi-employer Plan.
"Unfunded Liabilities" means, (i) in the case of a Single Employer Plan, the
amount,if any, by which the present value of all vested nonforfeitable benefits
under such Plan exceeds the fair market value of all Plan assets allocable to
such benefits, all determined as of the most recent valuation date for such
Plan, and (ii) in the case of a Multiemployer Plan, the withdrawal liability of
the Borrower or any ERISA Affiliate under such Plan.
"Unused Commitment" means, at any time, the excess of the Aggregate Commitment
at such time over the Aggregate Outstandings at such time.
SECTION 1.02 Computation of Time Periods. In this Amended and Restated
Agreement in the computation of periods of time from a specified date to a later
specified date, the word "from" means "from and including" and the words "to"
and "until" each means "to but excluding."
SECTION 1.03 Accounting Terms; Fiscal Periods. Except as otherwise permitted
pursuant to Section 9.09 all accounting terms not specifically defined herein
shall be construed in accordance with GAAP. All references in this Amended and
Restated Agreement to any fiscal period shall refer to a fiscal period of the
Borrower, unless otherwise specified.
SECTION 1.04 Other Definitional Provisions. References to "Sections",
"Articles", "Schedules" and "Exhibits" shall be to Sections, Articles, Schedules
and Exhibits, respectively, of this Amended and Restated Agreement unless
otherwise specifically provided.
ARTICLE II
THE FACILITIES AND COMMITMENTS
SECTION 2.01 The Facilities. On and subject to the terms and conditions
hereinafter set forth each Lender severally agrees to extend credit and other
financial accommodations of the kind described below to the Borrower, from time
to time, on any Business Day during the period from the date hereof until the
Termination Date by (i) making Advances to the Borrower pursuant to Article III
(the "Advance Facility"); and (ii) issuing Letters of Credit for the account of
the Borrower pursuant to Article IV (the "Letter of Credit Facility").
11
SECTION 2.02 The Advance Commitment. The credit extended by the Lenders by
making Advances under the Advance Facility shall be in an aggregate principal
amount of Advances not to exceed at any time outstanding the excess of the
Aggregate Commitment over the Letter of Credit Obligations outstanding at such
time, as such amount may be reduced pursuant to Section 2.05, during the period
from the date hereof to the Termination Date (the "Advance Commitment").
SECTION 2.03 The Letter of Credit Commitment. The credit extended by the
Lenders by issuing Letters of Credit under the Letter of Credit Facility shall
be in an aggregate amount of Letter of Credit Obligations outstanding at any
time not to exceed the lesser of (a) $10,000,000 and (b) the excess of the
Aggregate Commitment over the aggregate principal amount of Advances outstanding
at such time, as such amount may be reduced pursuant to Section 2.05, during the
period from the date hereof to the Termination Date (the "Letter of Credit
Commitment").
SECTION 2.04 Fees. The Borrower agrees to pay (i) an extension fee to the
Lenders and an annual administrative fee to NationsBank, for its own account,
each as described in the fee letter agreement dated November 26, 1997, and (ii)
to NationsBank, for its own account and the account of the Lenders, as
applicable, the Letter of Credit fees described in Section 4.07. The Borrower
also agrees to pay to the Agent, for the account of each Lender, a commitment
fee on such Lender's Pro Rata Share of the average daily Unused Commitment from
the date of this Amended and Restated Agreement until the Termination Date equal
to the Applicable Commitment Fee per annum. Such commitment fee shall be payable
on the last day of each January, April, July and October during the term of this
Amended and Restated Agreement, and on the Termination Date.
SECTION 2.05 Reduction of the Commitment. The Borrower shall have the right,
upon at least thirty (30) Business Days' notice to the Agent, to terminate in
whole or reduce in part the Aggregate Commitment by an amount not exceeding the
Unused Commitment, each such reduction to be allocated among the unused portions
of the Advance Commitment and the Letter of Credit Commitment, as the Borrower
shall specify, in accordance with each Lender's Pro Rata Share thereof;
provided, however, that each partial reduction shall be in the amount of
$1,000,000 and in integral multiples of $1,000,000 in excess of that amount.
SECTION 2.06 Payments and Computations.
(a) The Borrower shall make each payment hereunder by wire transfer of
immediately available funds not later than Noon (Dallas time) on the day when
due in United States Dollars to the Agent, for the account of the Lenders, at
the Agent's address referred to in Section 9.02. The Agent will promptly
thereafter cause to be distributed like funds relating to the payment of
principal or interest or commitment fees ratably (other than amounts payable
pursuant to Section 2.07, 3.07, or 9.05(b)) to the Lenders for the account of
their respective Applicable Lending office, and like funds relating to the
payment of any other amount payable to any Lender to such Lender for the account
of its Applicable Lending office, in each case to be applied in accordance with
the terms of this Amended and Restated Agreement.
(b) The Borrower hereby authorizes each Lender, if and
12
to the extent payment owed to such Lender is not made when due hereunder, to
charge from time to time against any or all of the Borrower's accounts with such
Lender any amount so due, or, upon notice to the Borrower, to make Base Rate
Advances in the amount of and in payment of such amounts.
(c) All computations of interest on Base Rate Advances shall be made by the
Agent, on the basis of a year of 365 or 366 days, as the case may be, for the
actual number of days (including the first day but excluding the last day)
occurring in the period for which such interest is payable. All computations of
interest on Eurodollar Rate Advances and of fees (including, without limitation,
all computations of interest pursuant to Section 3.07) shall be made by the
Agent, on the basis of a year of 360 days, in each case for the actual number of
days (including the first day but excluding the last day) occurring in the
period for which such interest or fees are payable. Each determination by the
Agent of an interest rate hereunder shall be conclusive and binding for all
purposes, absent manifest error.
(d) Whenever any payment hereunder shall be stated to be due on a day other
than a Business Day, such payment shall be made on the next succeeding Business
Day, and such extension of time shall in such case be included in the
computation of payment of interest or fees, as the case may be; provided,
however, that if such extension would cause payment of interest on or principal
of Eurodollar Rate Advances to be made in the next following calendar month,
such payment shall be made on the immediately preceding Business Day.
(e) Unless the Agent shall have received notice from the Borrower prior to the
date on which any payment is due to the Lenders hereunder that the Borrower will
not make such payment in full, the Agent may assume that the Borrower has made
such payment in full to the Agent on such date and the Agent may, in reliance
upon such assumption, cause to be distributed to each Lender on such date an
amount equal to the amount then due such Lender. If and to the extent the
Borrower shall not have so made such payment in full to the Agent, each Lender
shall repay to the Agent forthwith on demand such amount distributed to such
Lender together with interest thereon, for each day from the date such amount is
distributed to such Lender until the date such Lender repays such amount to the
Agent, at the Federal Funds Rate.
SECTION 2.07 Increased Capital or Costs and Reduced Return.
(a) If, due to either (i) the introduction of or any change (other than any
change by way of imposition or increase of reserve requirements included in the
Eurodollar Rate Reserve Percentage) in or in the interpretation of any law or
regulation; or (ii) the compliance with any guideline or request from any
central bank or other Governmental Authority (whether or not having the force of
law), there shall be any increase in the cost to any Lender of agreeing to make
or making, funding or maintaining Eurodollar Rate Advances, by an amount deemed
by such Lender to be material, then the Borrower shall, from time to time,
promptly following demand by such Lender (with a copy of such demand to the
Agent), pay to the Agent, for the account of such Lender, such additional amount
or amounts as will compensate such Lender for such increased cost.
(b) If after the date hereof, any Lender shall have determined that the
adoption of any applicable law, rule or regulation regarding capital adequacy,
or any change
13
therein, or any change in the interpretation or administration thereof by any
Governmental Authority, central bank or comparable agency charged with the
interpretation or administration thereof, or compliance by such Lender (or its
Applicable Lending Office) with any request or directive regarding capital
adequacy (whether or not having the force of law) of any such Governmental
Authority, central bank or comparable agency, has or would have the effect of
reducing the rate of return on such Lender's capital as a consequence of its
obligations hereunder to a level below that which such Lender could have
achieved but for such adoption, change or compliance by an amount deemed by such
Lender to be material, then the Borrower shall, from time to time, promptly
following demand by such Lender (with a copy of such demand to the Agent), pay
to the Agent, for the account of such Lender, such additional amount or amounts
as will compensate such Lender for such reduction.
(c) Each Lender agrees to promptly notify the Borrower and Agent of any event
of which such Lender has knowledge, occurring after the date hereof, which will
entitle such Lender to compensation pursuant to this Section 2.07 and will
designate a different Applicable Lending Office if such designation will avoid
the need for, or reduce the amount of, such compensation and will not, in the
judgment of such Lender, be otherwise disadvantageous to such Lender. A
certificate of the Lender claiming compensation under this Section 2.07 and
setting forth the additional amount or amounts to be paid to such Lender
hereunder, submitted to the Borrower and the Agent contemporaneously, shall be
conclusive in the absence of manifest error. In determining such amount, such
Lender may use any reasonable averaging and attribution methods.
SECTION 2.08 Interest Rate Contracts. At any time a Lender may, but shall have
no obligation to, enter into Interest Rate Contracts with respect to the
Advances, provided that the notional amount for all such Interest Rate Contracts
in effect at any time shall not exceed $40,000,000 in the aggregate. The
Borrower and the Lender entering into an Interest Rate Contract shall give
written notice to the Agent, at least three (3) Business Days prior to entering
into any Interest Rate Contract, specifying the term thereof and the notional
amount thereof. The Agent shall, within two (2) Business Days of such notice,
notify the applicable Lender and the Borrower whether the sum of (A) the
aggregate notional amount of all Interest Rate Contracts then in effect plus (B)
the notional amount of the proposed Interest Rate Contract, is within the limit
set forth above, and if the sum of the notional amounts described in clauses (A)
and (B) above is within such limit at such time, then the proposed Interest Rate
Contract shall be deemed an "Eligible Interest Rate Contract" (whether or not
the aggregate notional amount subsequently exceeds such limit).
ARTICLE III
THE ADVANCE FACILITY
SECTION 3.01 The Advances. Each Lender severally agrees, on the terms and
conditions hereinafter set forth, to make Advances to the Borrower from time to
time on any Business Day during the period from the date hereof until the
Termination Date in an amount not to exceed the excess of (i) such Lender's Pro
Rata Share of the Advance Commitment at such time over (ii) the aggregate
principal
14
amount of all Advances made by such Lender and outstanding at such time. Each
Advance made by a Lender shall be in an amount not less than such Lender's Pro
Rata Share of $250,000. Each Borrowing shall consist of Advances made on the
same day by the Lenders, each Lender's Advance as part of a Borrowing to be in
an amount equal to its Pro Rata Share of such Borrowing. Within the limits of
the Advance Commitment in effect from time to time, the Borrower may borrow
pursuant to this Section 3.01, prepay pursuant to Section 3.08, and reborrow
under this Section 3.01.
SECTION 3.02 Making the Advances.
(a) Each Borrowing shall be made on notice by the Borrower to the Agent, given
not later than 12:00 noon (Dallas time) (i) in the case of a Borrowing comprised
of Base Rate Advances, on the date of the proposed Borrowing; and (ii) in the
case of a Borrowing comprised of Eurodollar Rate Advances, on the third Business
Day prior to the date of the proposed Borrowing; provided, however, that (x) in
the case of any requested Borrowing to be comprised of Base Rate Advances, the
proceeds of which Base Rate Advances are to be applied toward the Borrower's
Reimbursement Obligations under a Letter of Credit, the notice effecting such
request may be given at or prior to 2:00 P.M. on the date of the drawing giving
rise to such Reimbursement Obligation for a Borrowing comprised of Base Rate
Advances to be made on such date in the amount of such Reimbursement Obligation;
and (y) if a Default or an Event of Default has occurred and is continuing, the
Borrower shall not be entitled to request Borrowings comprised of Eurodollar
Rate Advances and the Lenders shall not be required to make any Advances. Each
such notice of a borrowing (a "Notice of Borrowing") shall be by telephone,
confirmed immediately in writing (whether by telecopy, telex, cable or
otherwise), in substantially the form of Exhibit A, specifying therein the
requested (i) date of such Borrowing (which shall be a Business Day); (ii) Type
of Advances comprising such Borrowing; (iii) amount of such Borrowing; and (iv)
Interest Period for such Advance in the case of a requested Borrowing comprised
of Eurodollar Rate Advances. Promptly after receipt of a Notice of Borrowing
under this Section 3.02 (or telephonic notice in lieu thereof), the Agent shall
notify each Lender by telex, telecopy, telegram, telephone or other similar form
of transmission of the proposed Borrowing, and in each case of a proposed
Borrowing comprised of Eurodollar Rate Advances, of the applicable interest
rate. Each Lender shall, before Noon (Dallas time) on the date of such
Borrowing, make available to the Agent at its address referred to in Section
9.02, in same day funds, such Lender's Pro Rata Share of such Borrowing. After
the Agent's receipt of such funds, and upon fulfillment of the applicable
conditions set forth in Article V, the Agent will make same day funds available
to the Borrower at the Agent's address referred to in Section 9.02 in an amount
equal to the amount requested by the Borrower for such Borrowing on the date
requested by the Borrower therefor.
(b) Each Notice of Borrowing shall be irrevocable and binding on the Borrower.
In the case of any Borrowing that the related Notice of Borrowing specifies is
to be comprised of Eurodollar Rate Advances, the Borrower shall indemnify each
Lender against any loss, cost or expense incurred by such Lender as a result of
any failure by the Borrower to fulfill, on or before the date specified in such
Notice of Borrowing for such Borrowing, the applicable conditions set forth in
Article V, including, without limitation, any loss, cost or expense incurred by
reason of
15
the liquidation or reemployment of deposits or other funds acquired by such
Lender to fund the Advance to be made by such Lender as part of such Borrowing
when such Advance, as a result of such failure, is not made on such date.
(c) Unless the Agent shall have received notice from a Lender prior to the
date of any Borrowing that such Lender will not make available to the Agent such
Lender's Pro Rata Share of such Borrowing, the Agent may assume that such Lender
has made such portion available to the Agent on the date of such Borrowing in
accordance with and to the extent provided in subsection (a) of this Section
3.02 and the Agent may, in reliance upon such assumption, make available to the
Borrower on such date a corresponding amount; provided, however, that if the
Agent has received such notice from such Lender, the Agent may not make such
assumption and may not make available to the Borrower on such date such
corresponding amount. If and to the extent such Lender shall not have so made
such Pro Rata Share available to the Agent, such Lender and the Borrower
severally agree to repay to the Agent forthwith on demand such corresponding
amount together with interest thereon, for each day from the date such amount is
made available to the Borrower until the date such amount is repaid to the
Agent, at the Federal Funds Rate for such day. If such Lender shall repay to the
Agent such corresponding amount, such amount so repaid shall constitute such
Lender's Advance as part of such Borrowing for purposes of this Amended and
Restated Agreement.
(d) The failure of a Lender to make the Advance to be made by it as part of
any Borrowing shall not relieve any other Lender of its obligation, if any,
hereunder to make its Advance on the date of such Borrowing, but no Lender shall
be responsible for the failure of any other Lender to make the Advance to be
made by such other Lender on the date of any Borrowing.
SECTION 3.03 Conversion or Continuation of Advances.
(a) The Borrower shall have the option (i) to convert at any time all or any
part of the outstanding Base Rate Advances comprising the same Borrowing into
one or more Eurodollar Rate Advances, each for an Interest Period commencing on
the applicable Conversion Date; (ii) to convert on any Interest Period
Expiration Date all of the outstanding Eurodollar Rate Advances comprising the
same Borrowing into one or more Base Rate Advances; or (iii) to continue on any
Interest Period Expiration Date all or any part of outstanding Eurodollar Rate
Advances comprising the same Borrowing as one or more Eurodollar Rate Advances,
each for an Interest Period commencing on such Interest Period Expiration Date;
provided, however, that (A) if the Borrower shall not have exercised its options
set forth in either clauses (ii) or (iii) of this Section 3.03(a) with respect
to any Eurodollar Rate Advances comprising a Borrowing by delivery to the Agent
of a Notice of Continuation or Conversion in accordance with the terms of
Section 3.03(b), the Borrower shall be deemed to have irrevocably elected to
convert such Eurodollar Rate Advances into Base Rate Advances on the Interest
Period Expiration Date for such Advances, and (B) if a Default or an Event of
Default has occurred and is continuing the Borrower shall not be entitled to
convert Base Rate Advances or continue Eurodollar Rate Advances.
(b) Each continuation or conversion of Advances pursuant to this Section 3.03
shall be made on notice by the
16
Borrower to the Agent given not later than Noon (Dallas time) on (i) in the case
of the conversion of one or more Eurodollar Rate Advances into Base Rate
Advances, the first Business Day prior to the date of the proposed conversion,
and (ii) in every other instance, the third Business Day prior to the date of
the proposed conversion or continuation. Each such notice of continuation or
conversion (a "Notice of Continuation or Conversion") shall be by telephone,
confirmed immediately in writing (whether by telecopy, telex, cable or
otherwise), in substantially the form of Exhibit B, specifying therein the
requested (i) date of such continuation or conversion (which shall be a Business
Day); (ii) amount of the Advances to be converted or continued; (iii) nature of
such conversion or continuation; and (iv) Interest Periods for such Advances, in
the case of a conversion of one or more Base Rate Advances to a Eurodollar Rate
Advance or a continuation of one or more Eurodollar Rate Advances. Promptly
after receipt of a notice of Continuation or Conversion (or telephonic notice in
lieu thereof), the Agent shall notify each Lender by telex, telecopy, telegram,
telephone or other similar form of transmission, of the proposed continuation or
conversion.
(c) Each Notice of Continuation or Conversion shall be irrevocable and binding
upon the Borrower. In the case of any Advance which the related Notice of
Continuation or Conversion specifies is to be a Eurodollar Rate Advance, the
Borrower shall indemnify each Lender against any loss, cost or expense incurred
by such Lender as a result of any failure to fulfill on or before the date of
the continuation or conversion specified in such Notice of Continuation or
conversion for such Advance the applicable conditions set forth in Article V,
including, without limitation, any loss, cost or expense incurred by reason of
the liquidation or reemployment of deposits or other funds acquired by such
Lender to fund such Advance when such Advance is not converted or continued, as
the case may be, on such date.
SECTION 3.04 Additional Provisions Applicable to Eurodollar Rate Advances.
Anything in Section 3.02 or 3.03 above to the contrary notwithstanding:
(a) If any Lender shall notify the Borrower (with a copy of such notice to the
Agent) that the introduction of or any change in or in the interpretation of any
law or regulation makes it unlawful, or that any central bank or other
Governmental Authority asserts that it is unlawful, for such Lender or its
Eurodollar Lending Office to perform its obligations hereunder to make
Eurodollar Rate Advances or to fund or maintain Eurodollar Rate Advances
hereunder, the right of the Borrower to select Eurodollar Rate Advances for any
Borrowing or to convert any Base Rate Advances to Eurodollar Rate Advances shall
be suspended until such Lender shall notify the Borrower (with a copy of such
notice to the Agent) that the circumstances causing such suspension no longer
exist. Upon any Lender's giving of the notice to the Borrower referred to in
this Section 3.04(a), the Borrower shall, upon at least one (1) Business Day's
written notice to such Lender (with a copy of such notice to the Agent), or if
permitted by applicable law no later than the date permitted thereby, in the
Borrower's sole discretion, either (i) prepay, notwithstanding the provisions of
Section 3.08 hereof, the principal amount of all outstanding Eurodollar Rate
Advances of such Lender together with accrued interest thereon to the date of
payment; or (ii) convert, notwithstanding the provisions of Section 3.03, all
17
Eurodollar Rate Advances of all Lenders then outstanding into Base Rate
Advances. Upon any such prepayment or conversion of a Eurodollar Rate Advance,
the Borrower shall reimburse the applicable Lender in respect thereof pursuant
to Section 9.05(b).
(b) If the Agent shall, on the date of the making of any requested Borrowing
comprised of Eurodollar Rate Advances, the continuation pursuant to Section 3.03
of any Eurodollar Rate Advances or the conversion pursuant to Section 3.03 of
any Base Rate Advances, notify the Borrower that it is unable, for any reason
whatsoever, to obtain timely information for determining the Eurodollar Rate for
such Advances, the right of the Borrower to select Eurodollar Rate Advances for
such Borrowing or any Borrowing subsequently made, converted or continued shall
be suspended until the Agent shall notify the Borrower that the circumstances
causing such suspension no longer exist and each Advance requested to be
converted into or made or continued as a Eurodollar Rate Advance shall be a Base
Rate Advance.
(c) If any Lender shall, at least one (1) Business Day prior to the date of
the making of any requested Borrowing to be comprised of Eurodollar Rate
Advances, the continuation pursuant to Section 3.03 of any Eurodollar Rate
Advances or the conversion pursuant to Section 3.03 of any Base Rate Advances,
notify the Borrower (with a copy of such notice to the Agent) that the
Eurodollar Rate for such Advances will not adequately reflect the cost to such
Lender of making or funding such Advances, the right of the Borrower to select
Eurodollar Rate Advances for such Borrowing or any Borrowing subsequently made,
converted or continued shall be suspended until such Lender shall notify the
Borrower (with a copy of such notice to the Agent) that the circumstances
causing such suspension no longer exist and each Advance by such Lender
requested to be converted into or made or continued as a Eurodollar Rate Advance
shall be a Base Rate Advance.
(d) Any Taxes payable by the Agent or any Lender or ruled (by a Governmental
Authority) payable by the Agent or any Lender in respect of any Loan Document
shall, if permitted by law, be paid by the Borrower, together with interest and
penalties, if any (except for (i) (1) Taxes imposed on or measured by the
overall net income of the Agent or that Lender, (2) franchise or similar taxes
of the Agent or that Lender, and (3) amounts requested to be withheld for Taxes
pursuant to the last sentence of Section 3.04(f) and (ii) interest and penalties
incurred as a result of the gross negligence or willful misconduct of the Agent
or any Lender). The Agent or that Lender (through the Agent) shall notify the
Borrower and deliver to the Borrower a certificate setting forth in reasonable
detail the calculation of the amount of payable Taxes, which certificate is
conclusive and binding (absent manifest error), and the Borrower shall promptly
pay that amount to the Agent for its account or the account of that Lender, as
the case may be. If the Agent or that Lender subsequently receives a refund of
the Taxes paid to it by the Borrower, then the recipient shall promptly pay the
refund to the Borrower.
(e) The Borrower Agrees To Indemnify Each Lender Against, And Pay To It Upon
Demand, Any Funding Losses, Costs or Expenses Described in Section 3.02(b),
3.03(c) or 9.05(b) With Respect To Eurodollar Rate Advances. The
18
provisions of and undertakings and indemnification set forth in this paragraph
shall survive the satisfaction and payment of the Obligations and termination of
this Amended and Restated Agreement.
(f) Each Lender that is organized under the laws of any jurisdiction other
than the United States of America or any State thereof (a) represents to the
Agent and the Borrower that (i) no Taxes are required to be withheld by the
Agent or the Borrower with respect to any payments to be made to it in respect
of the Obligations and (ii) it has furnished to the Agent and the Borrower two
duly completed copies of U.S. Internal Revenue Service Form 4224, Form 1001,
Form W-8, or any other tax form acceptable to the Agent (wherein it claims
entitlement to complete exemption from U.S. federal withholding tax on all
interest payments under the Loan Papers), and (b) covenants to (i) provide the
Agent and the Borrower a new tax form upon the expiration or obsolescence of any
previously delivered form according to law, duly executed and completed by it,
and (ii) comply from time to time with all laws with regard to the withholding
tax exemption. If any of the foregoing is not true or the applicable forms are
not provided, then the Borrower and the Agent (without duplication) may deduct
and withhold from interest payments under the Loan Documents United States
federal income tax at the full rate applicable under law.
SECTION 3.05 Notes; Repayment. Each Lender's Advances shall be evidenced by a
Revolving Loan Note executed by the Borrower and delivered to such Lenders
pursuant to Article V (each such Revolving Loan Note, as the same may be
amended, modified, substituted or supplemented from time to time being
hereinafter referred to individually as a "Note" and collectively as the
"Notes"), substantially in the form of Exhibit C, in an original principal
amount equal to such Lender's Pro Rata Share of the maximum Advance Commitment
on the date hereof. Unless the Termination Date shall have earlier occurred, the
Borrower shall repay the principal amount of the Advances outstanding on the
Maturity Date.
SECTION 3.06 Interest. The Borrower shall pay interest on the unpaid principal
amount of each Advance from the date of such Advance until such principal amount
shall be paid in full, at the following rates specified below:
(a) Base Rate Advances. If such Advance is a Base Rate Advance, at a rate per
annum equal at all times to the Alternate Base Rate in effect from time to time,
payable monthly in arrears on the last Business Day of each calendar month and
on the date such Base Rate Advance shall be paid in full; provided, however,
that any amount of principal which is not paid when due (whether at stated
maturity, by acceleration or otherwise) shall bear interest, from the date on
which such amount is due until such amount is paid in full, payable on demand,
at a rate per annum equal at all times to two percent (2.0%) per annum above the
Alternate Base Rate in effect from time to time.
(b) Eurodollar Rate Advances. If such Advance is a Eurodollar Rate Advance, at
a rate per annum equal at all times during any Interest Period for such Advance
to the sum of the Applicable Margin plus the Eurodollar Rate for such Advance
for such Interest Period, payable in arrears on the last day of such Interest
Period; provided, however, that any amount of principal which is not paid when
due (whether at stated maturity, by acceleration or otherwise) shall bear
19
interest, from the date on which such amount is due until such amount is paid in
full, payable on demand, at a rate per annum equal at all times to two percent
(2.0%) per annum above the Alternate Base Rate in effect from time to time.
(c) Default Interest. Notwithstanding anything to the contrary in Sections
3.06(a) and 3.06(b), effective upon the occurrence of an Event of Default and
for as long thereafter as such Event of Default shall be continuing, all amounts
outstanding under the Loan Documents shall bear interest at a rate per annum
equal at all times to two percent (2.0%) per annum above the Alternate Base Rate
in effect from time to time, payable on demand and, absent demand, at the times
specified in Section 3.06(a) with respect to Base Rate Advances and at the times
specified in Section 3.06(b) with respect to Eurodollar Rate Advances.
(d) Rate Adjustment Periods. Notwithstanding anything to the contrary in
Sections 3.06(a) and 3.06(b) but subject to Section 3.06(c) above, at all times
during a Rate Adjustment Period, interest on each Eurodollar Rate Advance shall
be at a rate of one-quarter of one percent (0.25%) below the rate that would
otherwise be payable under Section 3.06(b), provided, however, that (A) no
reduction in the interest rate applicable to any Eurodollar Rate Advance
outstanding on the commencement of a Rate Adjustment Period shall take effect
until such Eurodollar Rate Advance has been continued or converted pursuant to
Section 3.03; (B) no reduction in the interest rate applicable to any Eurodollar
Rate Advance shall reduce such rate below the sum of 1.00% plus the Eurodollar
Rate for such Advance for such Interest Period; and (C) interest on any amount
of principal which is not paid when due (whether at stated maturity, by
acceleration or otherwise) shall continue to be paid at the rates otherwise
specified in Section 3.06(a) or 3.06(b) for such past due amounts.
SECTION 3.07 Additional Interest on Eurodollar Rate Advances. The Borrower
shall pay to each Lender (or to the Agent for the account of such Lender) so
long as such Lender shall be required under regulations of the Board of
Governors of the Federal Reserve System to maintain reserves with respect to
liabilities or assets consisting of or including Eurocurrency Liabilities,
additional interest on the unpaid principal amount of each Eurodollar Rate
Advance of such Lender, from the date of such Advance until such principal
amount is paid in full, at an interest rate per annum equal at all times to the
remainder obtained by subtracting (i) the Eurodollar Rate for the Interest
Period for such Advance from (ii) the rate obtained by dividing such Eurodollar
Rate by a percentage equal to 100% minus the Eurodollar Rate Reserve Percentage
of such Lender for such Interest Period, payable on each date on which interest
is payable on such Advance; provided that the Borrower shall only be responsible
for reserve costs incurred by a Lender not more than 270 days prior to the date
on which such Lender notifies the Borrower thereof. Such additional interest so
notified to the Borrower (with a copy to the Agent) by such Lender shall be
payable to such Lender (or to the Agent for the account of such Lender) on the
dates specified for payment of interest for such Advance in Section 3.06.
SECTION 3.08 Pre-payments. The Borrower may prepay the outstanding amount of
any Advance in whole or in part with accrued interest to the date of such
prepayment on the amount prepaid; provided, however, that (i) notice of any
20
prepayment of a Eurodollar Rate Advance must be given at least three (3)
Business Days prior to the date of prepayment; (ii) notice of any prepayment of
a Base Rate Advance must be given not later than 12:00 noon (Dallas time) on the
date of prepayment; (iii) any prepayment of any Eurodollar Rate Advance shall be
made on, and only on, the last day of an Interest Period for such Advance; and
(iv) each partial prepayment shall be in a principal amount of $250,000 and
integral multiples of $50,000 in excess of that amount and, if made after the
Termination Date, shall be applied to the principal installments on each
Lender's Note in the inverse order of their maturities.
SECTION 3.09 Maximum Interest Rate. Regardless of any provision contained in
any Loan Document or any document related thereto, it is the intent of the
parties hereto that neither the Agent nor any Lender contract for, charge, take,
reserve, receive or apply, as interest on all or any part of the Obligations any
amount in excess of the Maximum Rate or the Maximum Amount or receive any
unearned interest in violation of any applicable law, and, if the Lenders ever
do so, then any excess shall be treated as a partial repayment or prepayment of
principal and any remaining excess shall be refunded to the Borrower. In
determining if the interest paid or payable exceeds the Maximum Rate, the
Borrower and the Lenders shall, to the maximum extent permitted under applicable
law, (a) treat all Borrowings as but a single extension of credit (and the
Lenders and the Borrower agree that is the case and that provision in this
Amended and Restated Agreement for multiple Borrowings is for convenience only),
(b) characterize any nonprincipal payment as an expense, fee or premium rather
than as interest, (c) exclude voluntary repayments or prepayments and their
effects, and (d) amortize, prorate, allocate and spread the total amount of
interest throughout the entire contemplated term of the Obligations. However, if
the Obligations are paid in full before the end of their full contemplated term,
and if the interest received for its actual period of existence exceeds the
Maximum Amount, the Lenders shall refund any excess (and the Lenders may not, to
the extent permitted by law, be subject to any penalties provided by any laws
for contracting for, charging, taking, reserving or receiving interest in excess
of the Maximum Amount). If the laws of the State of Texas are applicable for
purposes of determining the "Maximum Rate" or the "Maximum Amount," then those
terms mean the "indicated rate ceiling" from time to time in effect under
Article 5069-1.04, Title 79, Revised Civil Statutes of Texas, as amended. The
Borrower agrees that Chapter 15, Subtitle 79, Revised Civil Statutes of Texas,
1925, as amended (which regulates certain revolving credit loan accounts and
revolving tri-party accounts), does not apply to the Obligations, other than
Article 15.10(b).
SECTION 3.10 Interest Recapture. If the designated interest rate applicable to
any Borrowing exceeds the Maximum Rate, the interest rate on that the Borrowing
is limited to the Maximum Rate, but any subsequent reductions in the designated
rate shall not reduce the interest rate thereon below the Maximum Rate until the
total amount of accrued interest equals the amount of interest that would have
accrued if that designated rate had always been in effect. If at maturity
(stated or by acceleration), or at final payment of the Notes, the total
interest paid or accrued is less than the interest that would have accrued if
the designated rates had always been in effect, then, at that time and to the
extent permitted by applicable law, the Borrower shall pay an amount equal to
the difference between
21
(a) the lesser of the amount of interest that would have accrued if the
designated rates had always been in effect and the amount of interest that would
have accrued if the Maximum Rate had always been in effect, and (b) the amount
of interest actually paid or accrued on the Notes.
SECTION 3.11 Extension of Maturity. If no Default or Event of Default exists,
the Borrower may request one-year extensions of the then-existing Maturity Date
by making such request to the Agent and each Lender between 90 and 60 days
preceding each anniversary of the date of this Amended and Restated Agreement.
The then-existing Maturity Date shall be extended for one year only if (a) the
Agent and each Lender consent in writing to such extension within 30 days
following the Borrower's request (with a failure to respond by the Agent or any
Lender being deemed a denial of such consent by such party), and (b) the
Borrower pays to the Agent, for the account of the Lenders, within 10 days after
its receipt of such consent, an extension fee equal to one-eighth of one percent
(1/8%) of the then-existing Aggregate Commitment.
ARTICLE IV
THE LETTER OF CREDIT FACILITY
SECTION 4.01 The Letters of Credit. The Agent agrees, on the terms and
conditions hereinafter set forth, to issue for the account of the Borrower one
or more Letters of Credit in accordance with this Article IV, from time to time
on any Business Day during the period from the date hereof to the Termination
Date in an aggregate face amount not to exceed the excess of (a) the Letter of
Credit Commitment at such time over (b) the Letter of Credit Obligations at such
time. Within the limits of the Letter of Credit Commitment, the Borrower may
obtain credit by having the Agent issue the Letters of Credit being requested by
the Borrower at such time, pay its Obligations with respect to such Letters of
Credit pursuant to Section 4.06, and again obtain credit by having the Agent
issue Letters of Credit under this Section 4.01.
SECTION 4.02 Amounts and Terms. The Agent shall not have any obligation to
issue any Letter of Credit at any time if the aggregate maximum amount then
available for drawing under Letters of Credit theretofore issued, after giving
effect to the Letter of Credit requested hereunder, shall exceed any limit
imposed by law or regulation upon the Agent.
SECTION 4.03 Conditions. In addition to being subject to the satisfaction of
the conditions contained in Article V, the obligation of the Agent to issue any
Letter of Credit is subject to the satisfaction in full of the following
conditions:
(a) the proposed Letter of Credit (including, without limitation, the level of
detail and specificity with respect to the documents, certificates and drafts to
be presented thereunder) shall be reasonably satisfactory to the Agent as to
form and content;
(b) as of the date of issuance, no order, judgment or decree of any
Governmental Authority shall purport by its terms to enjoin or restrain the
Agent from issuing the Letter of Credit, and no law, rule or regulation
applicable to the Agent and no request or directive (whether
22
or not having the force of law) from any Governmental Authority with
jurisdiction over the Agent shall prohibit or request that the Agent refrain
from the issuance of Letters of Credit generally or the issuance of that Letter
of Credit; and
(c) the proposed Letter of Credit shall be governed by The Uniform Customs and
Practice for Documentary Credits, 1993 Revision, International Chamber of
Commerce Publication No. 500, or any successor thereto, and, as to matters not
covered thereby, shall be governed by the internal laws and decisions (as
distinguished from conflict of laws principles) of the State of Texas.
SECTION 4.04 Issuing Letters of Credit.
(a) Letters of Credit shall be issued upon written notice by the Borrower to
the Agent, given not later than 10:00 A.M. (Dallas time) on the second Business
Day prior to the Business Day on which such Letters of Credit are requested to
be issued, or such lesser time prior to the requested issuance date as is
acceptable to the Agent. Each such notice (a "Request for Letters of Credit")
shall be in substantially the form of Exhibit D hereto, specifying therein (i)
the aggregate stated amount of the Letters of Credit requested, (ii) the
effective date (which day shall be a Business Day) of issuance of such requested
Letters of Credit, (iii) the date on which such requested Letters of Credit are
to expire (which date shall be a Business Day no more than 18 months following
such effective date and shall in no event be later than the Maturity Date unless
the Borrower deposits with and pledges to the Agent cash or cash equivalent
investments acceptable to the Agent in an amount equal to the face amount of
such Letter of Credit as collateral security for the Borrower's Obligations in
connection with such Letter of Credit), and (iv) the Person for whose benefit
the requested Letters of Credit are to be issued. At the time such request is
made, the Borrower shall also provide the Agent with completed and executed
Letter of Credit Applications and copies of the forms the Letters of Credit
which the Borrower has requested the Agent to issue. Each Request for Letters of
Credit shall be irrevocable and binding on the Borrower.
(b) Promptly after receipt of a Request for Letters of Credit together with
all supporting documentation, the Agent shall notify each Lender by telex,
telecopy, telegram, telephone or other similar form of transmission of the
proposed issuance of Letters of Credit. Subject to the satisfaction of the terms
and conditions of this Article IV and upon fulfillment of the applicable
conditions set forth in Article V, the Agent shall, on the requested date, issue
its Letter of Credit on behalf of the Borrower.
SECTION 4.05 Paying under Letters of Credit. In determining whether to pay
under any Letter of Credit, the Agent shall have no obligation other than to
confirm that documents that appear to comply on their face with the requirements
of such Letter of Credit have been delivered to it.
SECTION 4.06 Reimbursement Obligations. The Borrower is obligated, and hereby
unconditionally agrees, to pay in immediately available funds to the Agent the
amount of each drawing made under each Letter of Credit on the date of such
drawing (the obligation of the Borrower under this Section 4.06 with respect to
any drawing being the "Reimbursement Obligation" with respect to such drawing).
Any
23
Reimbursement Obligation with respect to any Letter of Credit that is not paid
by the Borrower to the Agent with respect to a Letter of Credit at or prior to
1:00 P.M. (Dallas time) on the date of the drawing giving rise thereto shall
bear interest, payable on demand, from the date of such drawing until repaid in
full to the Agent at a rate per annum equal at all times to two and one-half
percent (2.50%) per annum above the Alternate Base Rate in effect from time to
time. In the event of any conflict between the terms of this Amended and
Restated Agreement and any Letter of Credit Application the terms of this
Amended and Restated Agreement shall control.
SECTION 4.07 Compensation for Letters of Credit.
(a) The Borrower agrees to pay to the Agent, for the benefit of each Lender, a
letter of credit fee ("Letter of Credit Fee") with respect to each Letter of
Credit issued under this Article IV, payable quarterly in arrears on the last
day of each January, April, July and October and on the Termination Date, at a
per annum rate equal to the Applicable Margin (the "Letter of Credit Rate"),
based on the average daily undrawn available amount of such Letter of Credit
during such quarter.
(b) The Borrower shall, in addition, pay to the Agent for its own account with
respect to each Letter of Credit issued hereunder (i) upon its issuance, a
fronting fee, equal to one-eighth percent (1/8%) of its face amount, (ii) upon
any drawing under such Letter of Credit, a negotiation fee with respect to such
drawing equal in amount to $250, and (ii) upon any transfer of or amendment to
such Letter of Credit, a transaction fee equal in amount to $100.
(c) Notwithstanding the foregoing, effective immediately upon the occurrence
of an Event of Default and for as long thereafter as such Event of Default shall
be continuing, the Letter of Credit Rate shall be increased to three and one-
eighth percent (3.125%) per annum, payable on demand and, absent demand, at the
times specified in Section 4.07(a).
SECTION 4.08 Sharing of Payments. Immediately upon the Agent's issuance of any
Letter of Credit, the Agent shall be deemed to have sold and transferred to each
Lender, and each Lender shall be deemed irrevocably and unconditionally to have
purchased and received from the Agent, without recourse or warranty, an
undivided interest and participation (to the extent of such Lender's Pro Rata
Share) in the Letter of Credit and all applicable rights of the Agent in the
Letter of Credit, including rights to cash collateral pledged under Section 4.11
(other than rights to receive the fees provided for in the last sentence of
Section 4.07(b)). If the Borrower does not timely pay any Reimbursement
Obligation, the Agent is irrevocably authorized to fund the Reimbursement
Obligation as a Base Rate Borrowing and the proceeds of the Base Rate Borrowing
shall be advanced directly to the Agent to pay the Reimbursement Obligation. If
the Borrower fails to reimburse the Agent as provided in Section 4.06 and funds
are not advanced to satisfy the Reimbursement Obligation, the Agent shall
promptly notify each Lender of the Borrower's failure, of the date and amount
paid, and of each Lender's Pro Rata Share of the unreimbursed amount. Each
Lender shall promptly and unconditionally make available to the Agent in
immediately available funds its Pro Rata Share of the unpaid Reimbursement
Obligation. Such funds are due and payable to the Agent before the close of
business on (i)
24
the Business Day the Agent gives notice to each Lender of the Borrower's
reimbursement failure if the notice is received by a Lender before 2:00 p.m. in
the time zone where such Lender's Domestic Lending Office is located, or (ii) on
the next succeeding Business Day after the Business Day the Agent gives notice
to each Lender of the Borrower's reimbursement failure, if such notice is
received after 2:00 p.m. All amounts payable by any Lender accrue interest at
the Federal Funds Rate from the day the applicable draft or draw is paid by the
Agent to (but not including) the date the amount is paid by the Lender to the
Agent.
SECTION 4.09 Documentation. Upon the request of any Lender, the Agent shall
furnish to such Lender copies of any Letters of Credit, Letter of Credit
Reimbursement Agreements, and applications for any Letter of Credit to which the
Agent is party and such other documentation as may reasonably be requested by
such Lender.
SECTION 4.10 Indemnification; Exoneration.
(a) In addition to amounts payable as elsewhere provided in this Article IV,
and without limitation of the Borrower's obligations pursuant to Section 9.05,
the Borrower hereby agrees to protect, indemnify, pay and save the Agent and
each Lender harmless from and against any and all claims, demands, liabilities,
damages, losses, costs, charges and expenses (including reasonable attorneys'
and paralegals' fees) which the Agent or any of the Lenders may incur or be
subject to as a consequence, direct or indirect, of the failure of the Agent to
honor a drawing under any Letter of Credit as a result of any act or omission,
whether rightful or wrongful, of any present or future de jure or defacto
Governmental Authority (all such acts or omissions being hereinafter referred to
collectively as "Governmental Acts").
(b) As among the Borrower, the Agent and any of the Lenders, the Borrower
assumes all risks of the acts and omissions of, or misuse of any of the Letters
of Credit by, the respective beneficiaries of such Letters of Credit. In
furtherance and not in limitation of the foregoing, the Agent and the Lenders
shall not be responsible for: (i) the form, validity, sufficiency, accuracy,
genuineness or legal effect of any document submitted by any Person in
connection with the application for and issuance of any of the Letters of
Credit, even if it should in fact prove to be in any or all respects invalid,
insufficient, inaccurate, fraudulent or forged; (ii) the validity or sufficiency
of any instrument transferring or assigning or purporting to transfer or assign
any Letter of Credit or the rights or benefits thereunder or proceeds thereof,
in whole or in part, which may prove to be invalid or ineffective for any
reason; (iii) the failure of the beneficiary of any Letter of Credit to comply
fully with the conditions required in order to draw upon such Letter of Credit,
other than conditions expressly stated in such Letter of Credit; (iv) errors,
omissions, interruptions or delays in transmission or delivery of any messages,
by mail, cable, telegraph, telex or otherwise, whether or not they be in cipher;
(v) errors in interpretation of technical terms; (vi) any loss or delay in the
transmission or otherwise of any document required in order to make a drawing
under any Letter of Credit or of the proceeds thereof; (vii) the misapplication
by the beneficiary of a Letter of Credit of the proceeds of any drawing under
such Letter of Credit; or (viii) any consequences arising from causes beyond the
control of the Agent or any of the Lenders, including, without limitation,
25
any Government Acts. None of the above shall affect, impair, or prevent the
vesting of the Agent's or any Lender's rights or powers under this Section 4.10.
(c) In furtherance and extension, and not in limitation, of the specific
provisions set forth above, any action taken or omitted by the Agent under or in
connection with any of the Letters of Credit issued by the Agent or any related
certificates, if taken or omitted in good faith shall not result in any
liability of the Agent to the Borrower.
SECTION 4.11 Termination of Letters of Credit; Cash Collateral. The Agent may,
at any time upon or following the occurrence of an Event of Default at its sole
option, request that the Borrower deposit with the Agent, and upon any such
request the Borrower shall forthwith deposit with and pledge to the Agent, cash
or cash equivalent investments acceptable to the Agent in an amount equal to the
undrawn face amount of any Letters of Credit that remain outstanding from time
to time thereafter as collateral security for the Borrower's Obligations in
connection with such Letters of Credit. The right of the Agent to require, and
the Obligation of the Borrower to provide, collateral security shall continue to
exist notwithstanding the release of any other collateral security by the Agent
or any of the Lenders at any time. If the Borrower does not immediately deposit
such collateral security with the Agent upon any such request, the Agent is
hereby irrevocably authorized by the Borrower to fund such collateral security
by making a Base Rate Advance in the amount thereof and depositing the proceeds
of such Advance in a cash collateral account with the Agent.
ARTICLE V
CONDITIONS OF EXTENSIONS OF CREDIT
SECTION 5.01 Conditions Precedent to Initial Extension of Credit. The
obligation of each Lender to make its Pro Rata Share of the initial extension of
credit under this Amended and Restated Agreement (whether in the form of an
Advance or a Letter of Credit) is subject to the following conditions precedent:
(a) The Agent shall have received such documents, instruments and agreements
in furtherance of the financing transaction contemplated in the Loan Documents,
each in form and substance satisfactory to the Agent and its counsel, as the
Agent shall reasonably request, including, without limitation, those described
on the List of Closing Documents attached hereto as Exhibit F.
(b) No law or regulation affecting the Agent's or any Lender's entering into
the financing transaction contemplated by the Loan Documents shall impose upon
the Agent or any of the Lenders any material obligation, fee, liability, cost,
expense or damages.
SECTION 5.02 Conditions Precedent to Each Extension of Credit, Conversion or
Continuation. The obligation of each Lender to make any Advance, to issue any
Letter of Credit, or to convert or continue any Advance as described in Section
3.03 on the occasion of each such extension of credit (including the initial
extension of credit hereunder), conversion or continuation shall be subject to
the further conditions precedent that on the date of such
26
extension of credit, conversion or continuation:
(a) The following statements shall be true (and each of the giving of the
applicable Notice of Borrowing, Request for Letter of Credit or Notice of
Continuation or Conversion, as applicable, and the acceptance by the Borrower of
the proceeds or other benefits of the requested extension of credit, conversion
or continuation shall constitute a representation and warranty by the Borrower
that on the date of such extension of credit, conversion or continuation such
statements are true):
(i) The representations and warranties contained in Section 6.01 are correct
on and as of the date of such extension of credit, conversion or continuation
before and immediately after giving effect to such extension of credit,
conversion or continuation and to the application of the proceeds or other
benefits thereof, as though made on and as of such date; and
(ii) No event has occurred and is continuing, or would result from such
extension of credit, conversion or continuation or from the application of the
proceeds or other benefits thereof, that constitutes a Default or an Event of
Default.
(b) The Lenders shall have received such other approvals, opinions or
documents as the Lenders may reasonably request.
ARTICLE VI
REPRESENTATIONS AND WARRANTIES
SECTION 6.01 Representations and Warranties of the Borrower. The Borrower
represents and warrants to the Agent and each Lender that the following
statements are true, correct and complete as of the date of this Amended and
Restated Agreement and as of the date of each reaffirmation thereof made
pursuant to Section 5.02(a)(i):
(a) The Borrower (i) is a corporation duly organized, validly existing and in
good standing under the laws of the State of Colorado, and is duly qualified to
do business, and is in good standing as a foreign corporation, in each
jurisdiction in which such qualification is necessary or proper in view of its
business and operations or the ownership of its properties; (ii) does not own
any material amount of capital stock of, or have any other material equity
investment in, any Person other than its wholly-owned subsidiary, Vicorp
Restaurants, Inc., a corporation duly organized, validly existing and in good
standing under the laws of the State of Delaware, and the Borrower's ownership
of 100,004 shares of Preferred Stock issued by a single issuer in replacement of
a subordinated debenture in the original principal amount of $10,000,000 and
(iii) has not (nor has any subsidiary) used or transacted business under any
other corporate or trade name in the past five years, except as disclosed on
Schedule 6.01(a).
(b) The execution, delivery and performance by the Borrower of the Loan
Documents are within the Borrower's corporate powers, have been duly authorized
by all necessary corporate action, and do not contravene (i) the Borrower's
charter or by-laws; or (ii) any law or any contractual restriction binding on or
affecting the Borrower.
27
(c) No authorization or approval or other action by, and no notice to or
filing with, any Governmental Authority or regulatory body is required for the
due execution, delivery and performance by the Borrower of the Loan Documents.
(d) The Loan Documents are legal, valid and binding obligations of the
Borrower enforceable against the Borrower in accordance with their respective
terms.
(e) The consolidated balance sheet of the Borrower and its subsidiaries as at
July 31, 1997, and the related consolidated statement of income and retained
earnings of the Borrower and its subsidiaries for the three fiscal quarters then
ended, copies of which have been furnished to the Agent and each Lender, fairly
present the financial condition of the Borrower and its subsidiaries on a
consolidated basis as at such date and the results of the operations of the
Borrower and its subsidiaries an a consolidated basis for the period ended on
such date, all in accordance with GAAP consistently applied, and since July 31,
1997, there has been no material adverse change in such condition or operations,
or in the financial condition or operations of the Borrower and its
subsidiaries.
(f) There is no pending or threatened action or proceeding affecting the
Borrower or any of its subsidiaries before any Governmental Authority or
arbitrator, which action or proceeding (i) may materially adversely affect the
financial condition or operations of the Borrower and its subsidiaries on a
consolidated basis or (ii) purports to affect the legality, validity or
enforceability of any Loan Document.
(g) Neither the Borrower nor any of its subsidiaries is in violation of (i)
any applicable statute, regulation, rule, ordinance or permit of any
Governmental Authority or (ii) any patent, patent application, copyright,
trademark, trademark application, trade name, or license of any Governmental
Authority, in each case, in any respect that may materially adversely affect the
financial condition or operations of the Borrower and its subsidiaries on a
consolidated basis. The Borrower possesses adequate licenses, permits and other
governmental approvals and authorization and adequate patents, trademarks,
copyrights, trade names and licenses to continue to conduct its business as
heretofore conducted by it.
(h) Neither the Borrower nor any of its subsidiaries is in default with
respect to any note, indenture, loan agreement, mortgage, lease, deed or other
similar agreement relating to the borrowing of monies to which it is a party or
by which it is bound, which default may materially adversely affect the
financial condition or operations of the Borrower or any of its subsidiaries.
(i) All of the Borrower's and its subsidiaries' respective property, tangible
and intangible, is free and clear of all Liens, except as specifically permitted
by Section 7.02(a).
(j) The Borrower and each of its subsidiaries have filed all Tax returns and
other reports they are required by law to file and have paid all Taxes that are
due and payable, other than those being contested in good faith by appropriate
proceedings diligently conducted and for which adequate cash and financial
reserves have been
28
established.
(k) Without limiting the representations and warranties set forth in Section
6.01(g), neither the Borrower nor any of its subsidiaries has received notice to
the effect or is otherwise aware that its operations are not in material
compliance with all of the requirements of applicable federal, state and local
environmental, health and safety statutes and regulations or the subject of or
likely to become the subject of any federal or state investigation evaluating
whether any remedial action is needed to respond to a release of any Contaminant
into the environment, which non-compliance or remedial action could have a
material adverse effect on the business, operations, properties, assets or
condition (financial or otherwise) of the Borrower or any of its subsidiaries.
(l) No Plan has any Unfunded Liabilities. Each Plan complies in all material
respects with all applicable requirements of law and regulations; no Reportable
Event has occurred with respect to any Plan; neither the Borrower nor any of its
subsidiaries has withdrawn from any Plan or initiated steps to do so; and no
steps have been taken to terminate any Plan.
(m) None of the Borrower or any of its ERISA Affiliates maintains any employee
welfare benefit plans within the meaning of Section 3(l) of ERISA that provides
benefits to employees after termination of employment other than as required by
Section 601 of ERISA.
(n) The Borrower is not engaged in the business of extending credit for the
purpose of purchasing or carrying margin stock (within the meaning of Regulation
U issued by the Board of Governors of the Federal Reserve System), and no
proceeds of any extension of credit hereunder will be used to purchase or carry
any margin stock or to extend credit to others for the purpose of purchasing or
carrying any margin stock.
ARTICLE VII
COVENANTS OF THE BORROWER
SECTION 7.01 Affirmative Covenants. The Borrower covenants to Agent and each
Lender that, so long as any Obligation shall remain unpaid or any Lender shall
have any Commitment hereunder, the Borrower will, unless the Majority Lenders
shall otherwise consent in writing:
(a) Compliance with Laws, Etc. Comply, and cause each of its subsidiaries to
comply, in all material respects with all applicable laws, rules, regulations,
orders, ordinances and decrees, such compliance to include, without limitation,
paying before the same become delinquent all Taxes, recordation charges, rates,
dues, fees, fines, impositions, liabilities, obligations and encumbrances
imposed upon it or upon any of its property except to the extent contested in
good faith and with respect to which adequate (as determined by independent
public accountants having a national reputation) reserves shall have been
established. Without limiting the generality of the foregoing, the Borrower (i)
will conduct, and will cause each of its subsidiaries to conduct, its business
so as to comply in all material respects with all applicable environmental,
health and safety laws and regulations in all jurisdictions in which it is or
may at any time be doing
29
business, including, without limitation, the Federal Resource Conservation and
Recovery Act, the federal Comprehensive Environmental Response, Compensation and
Liability Act, the federal Clean Water Act, the federal Clean Air Act and the
federal Occupational Safety and Health Act; and (ii) will establish, maintain
and operate, and will cause each ERISA Affiliate to establish, maintain and
operate, all Plans to comply in all material respects with the provisions of
ERISA, IRC, all other applicable laws and all regulations and interpretations
thereunder.
(b) Reporting Requirements. Furnish to each Lender:
(i) as soon as available and in any event within forty-five (45) days after
the end of each fiscal quarter of the Borrower, consolidated (and, if the
Borrower at any time has any operating subsidiaries, consolidating) balance
sheets of the Borrower and its subsidiaries as of the end of such quarter
consolidated (and, if the Borrower at any time has any operating subsidiaries,
consolidating) statements of income and retained earnings of the Borrower and
its subsidiaries for such quarter and for the period commencing at the end of
the previous fiscal year and ending with the end of such quarter, all in
accordance with GAAP consistently applied, certified by the chief financial
officer of the Borrower on behalf of the Borrower and, in the case of quarter-
end statements with respect to which a review shall have been undertaken by
public accountants, accompanied by a summary of the review report rendered by
such accountants;
(ii) as soon as available and in any event within ninety (90) days after the
end of each fiscal year of the Borrower, a copy of the annual report for such
year for the Borrower and its subsidiaries, containing consolidated financial
statements for such year all in accordance with GAAP consistently applied,
certified by independent public accountants having a national reputation in a
manner acceptable to the Agent;
(iii) together with the financial statements required to be delivered under
Sections 7.01(b)(i) and (ii), a certificate of the president, chief financial
officer or treasurer of the Borrower demonstrating compliance with the
financial covenants set forth in Section 7.03 for and as at the end of such
quarter or year, as applicable, setting forth the calculations made by such
officer to determine such compliance, and certifying on behalf of the Borrower
that no Default or Event of Default shall have occurred during such quarter or
year, as applicable (or as of the end of such quarter or year, as applicable,
in the case of a Default or Event of Default consisting of a breach of the
financial covenants set forth in Section 7.03), or, if any Default or Event of
Default shall have occurred for or during such quarter or year, as applicable,
describing the nature thereof and the procedures that the Borrower shall have
taken or proposes to take with respect thereto;
(iv) as soon as possible and in any event within five (5) days after the
occurrence of each Default, Event of Default or other development, financial
or otherwise, which might materially adversely affect the business, properties
or affairs of the Borrower or any of its subsidiaries or the ability of the
Borrower to repay the Obligations, a statement of the chief financial officer
of the Borrower setting forth details of such Default, Event of Default or
other development and the action which the Borrower has taken and proposes to
take with respect thereto;
30
(v) promptly after the sending or filing thereof, copies of all reports
which the Borrower sends to any of its security holders, and copies of all
reports and registration statements which the Borrower or any subsidiary files
with the SEC or any national securities exchange;
(vi) before the beginning of each fiscal year of the Borrower, financial and
operations projections with respect to such fiscal year, including, without
limitation, pro forma financial statements prepared on a basis consistent with
the most recent financial statements delivered to the Lenders in accordance
with Sections 7.01(b)(i) and (ii), all in such detail as the Agent may
reasonably request;
(vii) within two hundred seventy (270) days after the close of each fiscal
year, a statement of the Unfunded Liabilities of each Plan, certified as
correct, to the extent applicable, by any actuary enrolled under ERISA;
(viii) as soon as possible and in any event within ten (10) days after the
Borrower or any of its subsidiaries knows that any Reportable Event has
occurred with respect to any Plan, a statement, signed by the chief financial
officer of the Borrower, describing such Reportable Event and the action which
the Company proposes to take with respect thereto;
(ix) as soon as possible and in any event within ten (10) days after receipt
thereof by the Borrower or any of its subsidiaries, a copy of (i) any notice
or claim to the effect that the Borrower or any such subsidiary is or may be
liable to any Person as a result of the release by the Borrower, any of its
subsidiaries, or any other Person of any toxic or hazardous waste or substance
into the environment, and (ii) any notice alleging any violation of any
federal, state or local environmental, health or safety law or regulation by
the Borrower or any of its subsidiaries; provided, however, that the Borrower
shall not be required to furnish to the Agent any such notice resulting from
any routine OSHA or health inspection to which the Borrower or any of its
subsidiaries is subject by virtue of its respective activities in the food
service industry, unless any violation described in such notice might have a
material adverse effect on the financial condition or operations of the
Borrower or any subsidiary; and
(x) such other information respecting the condition or operations, financial
or otherwise, of the Borrower or any of its subsidiaries as the Agent may from
time to time reasonably request, all in such detail as the Agent may
reasonably request.
(c) Preservation of Corporation Existence, Etc. Except as otherwise permitted
under Subsection 7.02(d), preserve and maintain, and cause each of its
subsidiaries to preserve and maintain, its corporate existence, rights,
franchises and privileges in the jurisdiction of its incorporation, and qualify
and remain qualified and in good standing, and cause each of its subsidiaries to
qualify and remain qualified and in good standing, as a foreign corporation in
each jurisdiction in which such qualification is necessary or proper in view of
its business and operations or the ownership of its properties.
31
(d) Maintenance of Insurance. Maintain, and cause each of its subsidiaries to
maintain, insurance with responsible and reputable insurance companies or
associations in such amounts as are usually carried, and covering such risks as
are ordinarily insured against, by Persons engaged in similar businesses and
owning similar properties in the same general areas in which the Borrower and
each such subsidiary operate; and comply, and cause each subsidiary to comply,
with all conditions and requirements necessary to maintain such insurance in
effect.
(e) Maintenance of Properties, Etc. Maintain and preserve, and cause each of
its subsidiaries to maintain and preserve, all of its properties, necessary or
useful in the proper conduct of its business, in good working order and
condition, ordinary wear and tear excepted, and maintain all assets, permits,
licenses, privileges, franchises, concessions, privileges, patents, trademarks,
copyrights, and trade names necessary to conduct its business as heretofore
conducted by it.
(f) Visitation Rights. At any reasonable time and from time to time, permit
the Lenders or any agent or representative thereof to visit and inspect any of
the properties of the Borrower or any of its subsidiaries, to examine and make
copies of and abstracts from the records and books of account of the Borrower or
any of its subsidiaries, and to visit and discuss the affairs, finances and
accounts of the Borrower or any of its subsidiaries with any of their respective
officers or with any of those of their respective directors that are involved in
the operations of the Borrower's or such subsidiary's business.
(g) Maintenance of Records. Maintain, and cause each of its subsidiaries to
maintain, books and records with respect to accounting matters in accordance
with generally accepted accounting principles consistently applied and in detail
sufficient to provide the Lenders the information required pursuant to Section
7.01(b).
(h) Condemnation. Notify the Agent, immediately upon learning of the
institution of any proceeding for the condemnation or other taking of all or any
part of any of the Borrower's real property or interests in real property if the
property or interests involved have a book value in excess of $1,000,000
(regardless of the value of the specific portion subject to such proceeding), of
the pendency of such proceeding and keep the Agent reasonably informed with
respect to such proceeding as it progresses.
(i) Destruction of Real Property. Notify the Agent immediately of any material
damage to or material loss or destruction of the Borrower's real property or
interests in real property with a book value in excess of $1,000,000, setting
forth the nature and extent of such destruction.
(j) Use of Proceeds. The Borrower will use the proceeds of the Advances only
to repay its obligations under the NationsBank Agreement, for working capital,
capital expenditures and other general corporate purposes, and for Permitted
Asset Acquisitions.
SECTION 7.02 Negative Covenants. The Borrower covenants to Agent and each
Lender that, so long as any Obligation shall remain unpaid or any Lender shall
have any Commitment hereunder, the Borrower will not, unless the Majority
Lenders shall otherwise consent in writing:
32
(a) Liens, Etc.
(i) Enter into or suffer to exist, or permit any of its subsidiaries to
enter into or suffer to exist, any arrangement that directly or indirectly
prohibits the Borrower or any of its subsidiaries from creating or incurring
any Lien upon or with respect to any of its property, other than the Loan
Documents, leases that prohibit Liens on the property leased and documents
governing transactions described in clause (a)(ii)(C) below that prohibit
Liens on the property or asset which is the subject of such transaction; or
(ii) Create or suffer to exist, or permit any of its subsidiaries to
create or suffer to exist, any Lien (other than the interest of the lessor
under any Operating Lease) upon or with respect to any of its property,
whether now owned or hereafter acquired, or assign, or permit any of its
subsidiaries to assign, any right to receive income, in each case to secure or
provide for the payment of any Debt of any Person, other than:
(A) Liens securing Taxes or the claims or demands of materialmen,
mechanics, carriers, warehousemen, landlords and other like persons, which
in any such case (1) are not delinquent or (2) are being contested
diligently and in good faith, provided that in the latter case the Borrower
or the applicable subsidiary has established adequate reserves therefor and
that neither the Borrower's nor any subsidiary's title to and right to use
its property is materially and adversely affected by the nonpayment of such
Tax, claim or demand;
(B) Permitted Existing Liens;
(C) Liens existing on such property at the time of its acquisition
(other than any such Liens created in contemplation of such acquisition),
and Liens on fixed assets of the Borrower or any of its subsidiaries
acquired, constructed or improved after the date hereof which are created
contemporaneously with such acquisition, construction or improvement to
secure the purchase price of such property or the cost of such construction
or improvement, and Liens on fixed assets of the Borrower or any of its
subsidiaries arising in connection with sale and leaseback transactions
entered into by the Borrower or any of its subsidiaries after the date
hereof; provided, however, that no Lien of the kind described in this clause
(C) shall extend to or cover any property or asset of the Borrower or any
subsidiary of the Borrower other than the property or asset so acquired or
the construction or improvement so procured; and
(D) any extension, renewal or replacement, in whole or in part of any of
the Liens referred to in the foregoing clauses (A) through (C), inclusive;
provided, however, that the amount of Debt secured by any such extension,
renewal or replacement Lien shall not exceed the amount of such Debt secured
immediately prior to such extension, renewal or replacement and such
extended, renewed, or replaced Lien shall be limited to the property or
assets covered by the Lien existing immediately prior to such extension,
renewal or replacement;
provided, however, that notwithstanding anything to the contrary in this Section
7.02(a), the aggregate amount of Debt of the Borrower or any of its subsidiaries
(including, without limitation, Capital Lease Obligations of the
33
Borrower or any of its subsidiaries) secured by any of the Liens referred to in
the foregoing clauses (B) and (C), plus all Guarantees permitted by Section
7.02(e) (whether or not secured) shall not at any time exceed $24,000,000.
(b) Debt. (i) Prepay or permit any of its subsidiaries to prepay, any of its
Debt, other than (A) the Obligations and (B) Debt other than as described in the
foregoing clause (i)(A) in an amount not to exceed $5,000,000 in any fiscal
year; or (ii) create, incur, assume or suffer to exist, or permit any of its
subsidiaries to incur, assume or suffer to exist, any Debt, except for (A) the
Obligations, (B) Permitted Existing Debt, (C) Debt secured by Liens upon the
property of the Borrower or any of its subsidiaries permitted pursuant to
Section 7.02(a), and (D) Permitted Franchise Guarantees.
(c) Dividends, Etc. Declare or make any dividend payment or other distribution
of assets, properties, cash, rights, obligations or securities on account of any
shares of any class of capital stock of the Borrower, or purchase, redeem or
otherwise acquire for value (or permit any of its subsidiaries to do so) any
shares of any class of capital stock of the Borrower or any warrants, rights or
options to acquire any such shares, now or hereafter outstanding, or make any
other distribution in respect of any shares of such capital stock, or agree to
any of the foregoing, if immediately after giving effect to such proposed
action, a Default or Event of Default would exist.
(d) Mergers, Etc. Merge or consolidate with or into, or convey, transfer,
lease or otherwise dispose of (whether in one transaction or in a series of
transactions) all or substantially all of its assets (whether now owned or
hereafter acquired) to, or acquire all or substantially all of the assets or
capital stock of, any Person, or enter into an agreement to do any of the
foregoing, or permit any of its subsidiaries to do so, except that (i) the
Borrower may acquire the assets of any Person pursuant to a Permitted Asset
Acquisition, (ii) any subsidiary of the Borrower may merge or consolidate with
or into, or transfer assets to, or acquire assets of, any other subsidiary of
the Borrower, and (iii) any subsidiary of the Borrower may merge into or
transfer assets to the Borrower; provided, however, that at the time of any
transaction permitted under any of the foregoing clauses (i), (ii) and (iii),
and immediately after giving effect to such transaction, no Default or Event of
Default would exist.
(e) Guarantees; Assumption of Obligations; Contingent Liabilities. Guarantee
or assume the obligations of any Person, including any subsidiaries of the
Borrower, or create or suffer to exist any other contingent liability, or permit
any subsidiary of the Borrower to do any of the foregoing, other than (i)
guarantees by endorsement of negotiable instruments for deposit or collection or
similar transactions in the ordinary course of business, (ii) Permitted
Franchisee Guarantees of up to $10,000,000, and (iii) existing guarantees as
disclosed on Schedule 7.02(b).
(f) Transactions with Affiliates. Enter into, or be a party to any transaction
with one of the Borrower's Affiliates, except in the ordinary course of business
and pursuant to the reasonable requirements of the Borrower's business and upon
fair and reasonable terms which are no less favorable to the Borrower than the
Borrower would obtain in a comparable arm's-length transaction with a
34
Person not the Borrower's Affiliate.
(g) Transactions Detrimental to Business, Etc. Enter into any transaction
which materially and adversely affects its business, property, assets,
operation, condition (financial or otherwise), any collateral security for the
Obligations or the Borrower's ability to perform its obligations under this
Amended and Restated Agreement or to repay the Obligations.
(h) Dispositions of Assets.
(i) Sell, lease, assign, transfer or otherwise dispose of any real
property (or enter into an agreement to do any of the foregoing), or permit
any of its subsidiaries to sell, lease, assign, transfer or otherwise dispose
of any real property (or enter into an agreement to do any of the foregoing),
except for the properties described on Schedule 7.02(h), without the prior
written consent of all of the Lenders; or
(ii) Sell, lease, assign, transfer or otherwise dispose of any other asset
(or enter into an agreement to do any of the foregoing), or permit any of its
subsidiaries to sell, lease, assign, transfer or otherwise dispose of any
other asset (or enter into an agreement to any of the foregoing), other than:
(A) the sale of inventory in the ordinary course of the Borrower's or
such subsidiary's business;
(B) the sale or other disposition of assets of the Borrower or such
subsidiary which are obsolete or no longer used or usable in the business
of the Borrower or such subsidiary; and
(C) the sale or other disposition of assets of the Borrower or such
subsidiary other than of the kind described in clause (A) or (B) above;
provided, however, that the value of all such other assets sold or otherwise
disposed of during any fiscal year pursuant to this clause (C) shall not
exceed $10,000,000, and provided further that in the event that the proceeds
of such dispositions exceed $2,000,000 in the aggregate during any fiscal
year, the Aggregate Commitment shall be permanently reduced by such excess
and the Borrower shall make an immediate mandatory prepayment of the
Obligations equal to the amount by which the Aggregate Outstandings exceed
such reduced Aggregate Commitment.
(i) ERISA. (i) Engage, or permit any ERISA Affiliate to engage, in any
prohibited transaction described in Section 406 of ERISA or 4975 of the IRC for
which a statutory or class exemption is not available or a private exemption has
not been previously obtained from the DOL; (ii) permit to exist any accumulated
funding deficiency (as defined in Sections 302 of ERISA and 412 of the IRC),
whether or not waived; (iii) fail, or permit any ERISA Affiliate to fail, to pay
timely required contributions or annual installments due with respect to any
waived funding deficiency to any Benefit Plan; (iv) terminate, or permit any
ERISA Affiliate to terminate, any Benefit Plan which would result in any
liability of the Borrower or any ERISA Affiliate under Title IV of ERISA; (v)
fail, or permit any ERISA Affiliate to fail, to make any contribution or payment
to any Multiemployer Plan which the Borrower or any ERISA Affiliate may be
required to make under any agreement relating to such Multiemployer Plan, or any
law pertaining
35
thereto; (vi) fail, or permit any ERISA Affiliate to fail, to pay any required
installment or any other payment required under Section 412 of the IRC on or
before the due date for such installment or other payment; (vii) amend, or
permit any ERISA Affiliate to amend, a Plan resulting in an increase in current
liability for the plan year such that the Borrower or any ERISA Affiliate is
required to provide security to such Plan under Section 401(a)(29) of the IRC.
(j) Restrictions on Operating Leases. Become, or permit any of its
subsidiaries to become, liable in any way whatsoever under any Operating Lease
in any fiscal year, unless, immediately after giving effect to the incurrence of
liability with respect to such Operating Lease, projected Consolidated Rental
Payments for such fiscal year and each succeeding fiscal year do not exceed
$20,000,000 per fiscal year.
(k) Loans, Advances and Investments. Not make and not permit any subsidiary to
make any loan, advance, extension of credit or capital contribution to, make any
investment in, or purchase or commit to purchase any stock or other securities
or evidences of Debt of, or interests in, any other Person, other than: (i)
expense accounts for and other advances to its directors, officers and employees
in the ordinary course of business up to an aggregate amount of $500,000
outstanding at any time; (ii) marketable obligations issued or unconditionally
guaranteed by the United States Government or issued by any of its agencies and
backed by the full faith and credit of the United States of America, in each
case maturing within one year from the date of acquisition (and investments in
mutual funds investing primarily in those obligations); (iii) short-term
investment grade domestic and eurodollar certificates of deposit or time
deposits that are fully insured by the Federal Deposit Insurance Corporation or
are issued by commercial banks organized under the Laws of the United States of
America or any of its states having combined capital, surplus, and undivided
profits of not less than $100,000,000 (as shown on its most recently published
statement of condition); (iv) commercial paper and similar obligations rated "P-
1" or better by ▇▇▇▇▇'▇ Investors Services, Inc., or "A-1" or better by Standard
& Poors Ratings Group (a division of McGraw Hill, Inc.); (v) investments in, and
advances to, wholly-owned subsidiaries, or by a wholly-owned subsidiary in or to
its parent; (vi) readily marketable tax-free municipal bonds of a domestic
issuer rated "aaa" or better by ▇▇▇▇▇'▇ Investors Service, Inc., or "AAA" or
better by Standard & Poors Ratings Group (a division of McGraw Hill, Inc.), and
maturing within one year from the date of issuance (and investments in mutual
funds investing primarily in those bonds); (vii) promissory notes up to an
aggregate amount of $3,000,000 outstanding at any time accepted as consideration
for the disposition of properties described on Schedule 7.02(h); (viii) demand
deposit accounts maintained in the ordinary course of business; (ix) current
trade and customer accounts receivable that are for goods furnished or services
rendered in the ordinary course of business and that are payable in accordance
with customary trade terms; and (x) Permitted Asset Acquisitions.
SECTION 7.03 Financial Covenants. The Borrower covenants to the Agent and each
Lender that so long as any Obligation shall remain unpaid or any Lender shall
have any obligation hereunder, the Borrower will, unless the Majority Lenders
shall otherwise consent in writing:
36
(a) Maximum Adjusted Debt to EBITDAR Ratio. Maintain a ratio, determined as of
the last day of each fiscal quarter, of (i) Adjusted Debt as of such date to
(ii) Adjusted Consolidated EBITDAR for the four fiscal quarters ending on such
date of no more than 3.50 to 1.
(b) Minimum Consolidated Tangible Net Worth. Maintain Consolidated Tangible
Net Worth, determined as of the last day of each fiscal quarter, of at least (i)
$115,000,000, plus (ii) an amount equal to the greater of zero (0) and fifty
percent (50%) of the consolidated net earnings after taxes of the Borrower and
its subsidiaries determined in accordance with GAAP for the period (taken as a
single accounting period) from and including November 1, 1996, to and including
such day, plus (iii) an amount equal to seventy-five percent (75%) of any Net
Equity Issuance Proceeds for the period (taken as a single accounting period)
from and including November 1, 1996, to and including such day.
(c) Maximum Consolidated Capital Expenditures. Not make or incur, and not
permit any of its consolidated subsidiaries to make or incur, Consolidated
Capital Expenditures, in any fiscal year in excess of $25,000,000; provided that
in the event the actual Consolidated Capital Expenditures made or incurred
during the applicable fiscal year are less than $25,000,000 (such difference
being referred to as a "Carry-Over Amount"), the permitted amount solely with
respect to the immediately succeeding fiscal year shall be increased by the
lesser of (i) $5,000,000 and (ii) such Carry-Over Amount.
(d) Minimum Fixed Charge Coverage Ratio. Maintain a ratio of (i) Adjusted
Consolidated EBITDAR to (ii) Consolidated Fixed Charges, determined as of the
last day of each fiscal quarter for the twelve month period ending on such day,
of at least 1.50 to 1.
(e) Maximum Debt to Capitalization Ratio. Maintain a ratio of (i) the sum of
(A) Consolidated Funded Debt, plus (B) Capital Lease Obligations of the Borrower
and its subsidiaries to (ii) the sum of (X) Consolidated Funded Debt, plus (Y)
Consolidated Net Worth, plus (Z) Capital Lease Obligations of the Borrower and
its subsidiaries, in each case, determined as of the last day of each fiscal
quarter, of no more than 0.40 to 1.
ARTICLE VIII
EVENTS OF DEFAULT
SECTION 8.01 Events of Default. If any of the following events ("Events of
Default") shall occur and be continuing:
(a) either (i) the Borrower shall fail to make any payment of principal on the
Advances when the same becomes due, or (ii) the Borrower shall fail to make any
other payment on the Obligations when the same becomes due and such failure
shall continue for five (5) days; or
(b) any representation or warranty made by the Borrower herein or in any other
Loan Document or by the Borrower (or any of its officers) in connection with any
Loan Document shall prove to have been incorrect or misleading in any material
respect when made; or
37
(c) the Borrower shall fail to perform or observe any term, covenant or
agreement contained in Section 7.02 on its part to be performed or observed; or
(d) the Borrower shall fail to perform or observe any other term, covenant
or agreement contained in any Loan Document on its part to be performed or
observed and any such failure shall remain unremedied for the earliest of (i)
ten (10) business days after written notice thereof shall have been given to the
Borrower by the Agent, (ii) ten (10) business days after the date the Borrower
discovers, or should have discovered, such failure, and (iii) if such failure
has existed for more that sixty (60) days, five (5) business days after the
earlier of (A) the date of delivery by the Agent to the Borrower of written
notice thereof, and (B) the date that the Borrower discovers, or should have
discovered, such failure; or
(e) with respect to any Debt (other than Debt constituting Obligations) of
the Borrower or any subsidiary of the Borrower in an aggregate principal amount
outstanding in excess of $1,000,000, the Borrower or such subsidiary shall fail
to pay any principal of or premium or interest on such Debt when the same
becomes due and payable (whether by scheduled maturity, required prepayment,
acceleration, demand or otherwise), and such failure shall continue after the
applicable grace period,if any, specified in the agreement or instrument
relating to such Debt; or any other event shall occur or condition shall exist
under any agreement or instrument relating to any such Debt and shall continue
after the applicable grace period, if any, specified in such agreement or
instrument, if the effect of such event or condition is to cause the holders of
such Debt to accelerate, or to permit the holders of such Debt to accelerate,
the maturity of such Debt; or any such Debt shall be declared to be due and
payable, or required to be prepaid (other than by a regularly scheduled required
prepayment), prior to the stated maturity thereof; or
(f) (i) the Borrower or any of its subsidiaries shall generally not pay its
debts as such debts become due, or shall admit in writing its inability to pay
its debts generally, or shall make a general assignment for the benefit of
creditors; or any proceeding shall be instituted by or against the Borrower or
any of its subsidiaries seeking to adjudicate it a bankrupt or insolvent, or
seeking liquidation, winding up, reorganization, arrangement, adjustment,
protection, relief, or composition of it or its debts under any law relating to
bankruptcy, insolvency or reorganization or relief of debtors, or seeking the
entry of an order for relief or the appointment of a receiver, trustee, or other
similar official for it or for any substantial part of its property (unless, if
such proceeding is involuntary, it is dismissed within 60 days after its
filing); or (ii) the Borrower or any of its subsidiaries shall take any
corporate action to authorize any of the actions set forth in clause (i) above;
or
(g) any judgment or order for the payment of money in excess of $1,000,000
above any insurance coverage therefor shall be rendered against the Borrower or
any of its subsidiaries by any Governmental Authority or quasi-governmental
authority, and either (i) enforcement proceedings shall have been commenced by
any creditor upon such judgment or order, or (ii) there shall be any period of
thirty (30) consecutive days during which a stay of enforcement of such judgment
or order, by reason of a
38
pending appeal or otherwise, shall not be in effect; or
(h) any Plan shall have any Unfunded Liabilities, or any Reportable Event
shall occur in connection with any Plan; or
(i) the Borrower or any of its subsidiaries shall be the subject of any
proceeding or investigation pertaining to the release by the Borrower, any of
its subsidiaries, or any other Person of any toxic or hazardous waste or
substance into the environment, or any violation of any federal, state or local
environmental, health or safety law or regulation, which would, in either case,
have a material adverse effect upon the operations of the Borrower or any of its
subsidiaries; or
(j) the acquisition by any Person, or two or more Persons acting in concert
(other than any Person or Persons who own, prior to that acquisition, 20% or
more of the outstanding shares of the Borrower's voting stock), of beneficial
ownership (within the meaning of Rule 13d-3 of the Securities and Exchange
Commission under the Securities Exchange Act of 1934) of 20% or more of the
outstanding shares of the Borrower's voting stock;
then, and in any such event, the Agent shall, at the direction of the Majority
Lenders, by notice to the Borrower (i) declare the Advance Commitment and the
Letter of Credit Commitment and the Advance Facility and the Letter of Credit
Facility and the obligations of each Lender under each of the Loan Documents, to
be terminated, whereupon the same shall forthwith terminate, and (ii) declare
the Obligations to be forthwith due and payable, whereupon such Obligations
shall become and be forthwith due and payable, without presentment, demand,
protest or further notice of any kind, all of which are hereby expressly waived
by the Borrower; provided, however, that upon the occurrence of any Event of
Default described in Section 8.01(f)(i) above, (A) the Advance Commitment and
the Letter of Credit Commitment, and the obligations of each Lender under each
of the Advance Facility and the Letter of Credit Facility, shall automatically
be terminated, and (B) the Obligations shall automatically become and be due and
payable, without presentment, demand, protest or any notice of any kind, all of
which are hereby expressly waived by the Borrower.
ARTICLE IX
MISCELLANEOUS
SECTION 9.01 Amendments, Etc. No amendment or waiver of any provision of
any Loan Document, nor consent to any departure by the Borrower therefrom, shall
in any event be effective unless the same shall be in writing and signed by the
Majority Lenders, and then such waiver or consent shall be effective only in the
specific instance and for the specific purpose for which given, provided that no
amendment or waiver which (i) increases the amount of any Lender's Commitment;
(ii) decreases the interest rates specified in Sections 3.06 or any fees payable
to the Lenders in Sections 2.04 and 4.07; (iii) extends the due date or
decreases the amount of any payments required hereunder; (iv) changes the
definition of "Majority Lenders" or "Pro Rata Shares"; or (v) changes the
provisions of this Section 9.01, shall be effective unless the same is signed by
all of the Lenders.
SECTION 9.02 Notices, Etc. All notices and other
39
communications provided for hereunder shall be in writing (including
telegraphic, telecopy, telex or cable communication) and mailed, telegraphed,
telexed, cabled or delivered, if to the Borrower, at its address at ▇▇▇ ▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇, ▇.▇. ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇.; and if to the Agent, at its address at ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇▇▇▇▇▇ ▇▇▇▇, with a copy to ▇▇▇▇▇▇ & ▇▇▇▇▇▇, L.L.P.,
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, Attention: F. ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇,
▇▇.; or, as to each party, at such other address as shall be designated by such
party in a written notice to the other party. All such notices and
communications shall be effective upon receipt, or if mailed, four (4) days
after deposit in the United States mails; if telegraphed, when delivered to the
telegraph company; if telexed, when confirmed by telex answerback; if
telecopied, when verbally confirmed by telephone; or if cabled, when delivered
to the cable company, except that notices and communications to the Agent
pursuant to Article II, III or IV shall not be effective until received by the
Agent.
SECTION 9.03 No Waiver; Remedies. No failure on the part of the Agent or
any Lender to exercise, and no delay in exercising, any right under any Loan
Document shall operate as a waiver thereof; nor shall any single or partial
exercise of any such right preclude any other or further exercise thereof or the
exercise of any other right. The remedies herein provided are cumulative and not
exclusive of any remedies provided by law.
SECTION 9.04 Payments Set Aside. To the extent that the Borrower makes a
payment or payments to the Agent or any of the Lenders, or the Agent or any of
the Lenders exercise their rights of set-off, and such payment or payments or
the proceeds of such enforcement or set-off or any part thereof are subsequently
invalidated, declared to be fraudulent or preferential, set aside and/or
required to be repaid to a trustee, receiver or any other party under any
bankruptcy law, real estate or federal law, common law or equitable cause, then
to the extent of such recovery, the Obligation or part thereof originally
intended to be satisfied, and all such Liens, rights and remedies therefor,
shall be revived and continued in full force and effect as if such payment had
not been made or such enforcement or set-off had not occurred.
SECTION 9.05 Costs, Expenses and Taxes.
(a) The Borrower agrees to pay on demand all "Costs and Expenses," as
hereinafter defined. "Costs and Expenses" means (A) all costs, expenses, fees
and charges incurred by the Agent or its Affiliates (including, without
limitation, NationsBanc ▇▇▇▇▇▇▇▇▇▇ Securities, Inc.) and all fees for services
(including disbursements) of the attorneys, accountants, valuation experts and
all professionals (and all paraprofessionals and other staff employed by such
professionals) employed by the Agent or any such Affiliate from time to time in
any way or for any purpose arising out of, or relating to, the Obligations of
the Borrower, any of the Loan Documents or the Agent's or such Affiliate's
relationship or transactions with the Borrower, including, without limitation,
(i) the development, preparation, negotiation, execution, delivery, syndication,
modification, review and administration of the Loan Documents, (ii) the
commencement, defense of or intervention in any court proceeding in any way
related to
40
the Obligations of the Borrower or the Loan Documents, or any other agreements
contemplated by the terms of this Amended and Restated Agreement, (iii) the
filing of a petition, complaint, answer, motion or other pleadings, or the
taking of any other action in or with respect to any suit or proceeding
(bankruptcy or otherwise) relating to the Borrower or any Loan Document, (iv)
the enforcement of any of the Agent's or any Lender's rights to collect any of
the Obligations, (v) all costs and expenses incurred by the Agent or any
Affiliate internally including, but not limited to, travel, food and lodging
expenses for employees, duplicating and document processing costs, and internal
auditing service expenses, and (vi) all audit costs, appraisal costs and costs
of searches, recordings and filings, all recording and filing fees, all Taxes
and all other similar fees and disbursements; and (B) all costs, expenses, fees
and charges incurred by each Lender (including fees and disbursements for
services of attorneys and paralegals) in connection with the matters described
in clauses (ii), (iii) and (iv) above. The Borrower also agrees to pay, and to
save harmless the Agent and the Lenders from any delay in paying, any tangibles,
intangibles, documentary stamp and other Taxes, if any, which may be payable in
connection with the execution and delivery of any of the Loan Documents, or the
recording of any hereof or thereof, or in connection with any modification
hereof or thereof, any of which Taxes payable by the Agent or the Lenders are to
be part of the Costs and Expenses. All Costs and Expenses provided for in this
Section 9.05 may, at the option of the Lenders, be charged and treated as a
Borrowing comprised of Base Rate Advances made by each Lender in accordance with
its Pro Rata Share.
(b) If any payment of principal of any Eurodollar Rate Advance is made
other than on the last day of the Interest Period for such Advance, as a result
of acceleration of the maturity of the Notes pursuant to Section 8.01 or for any
other reason, or if any Eurodollar Rate Advance is converted to a Base Rate
Advance pursuant to Section 3.04(a), the Borrower shall, upon demand by the
Agent, pay to each Lender any amounts required to compensate such Lender for any
additional losses, costs or expenses which such Lender may reasonably incur as a
result of such payment including, without limitation, any loss (including loss
of anticipated profits), cost or expense incurred by reason of the liquidation
or reemployment of deposits or other funds acquired by such Lender to fund or
maintain such Advance.
SECTION 9.06 Right of Set-Off. Subject to the provisions of Section 9.07,
the Agent, each Lender and each Affiliate of each Lender is hereby authorized at
any time and from time to time, to the fullest extent permitted by law, to set
off and apply any and all deposits (general or special, time or demand,
provisional or final) at any time held and other indebtedness at any time owing
by the Agent, such Lender or such Affiliate to or for the credit or the account
of the Borrower against any and all of the Obligations, irrespective of whether
or not any demand shall have been made under any Loan Document and although such
Obligations may be contingent and unmatured. Each Lender agrees to promptly
notify the Agent after any such setoff and application made by such Lender and
the Agent shall promptly thereafter notify the Borrower of such set-off and
application. The Agent agrees promptly to notify the Borrower after any set-off
and application made by the Agent; provided, however, that the Agent's failure
to notify
41
the Borrower as set forth in this sentence and the immediately preceding
sentence shall not affect the validity of such set-off and application. The
rights of the Agent and each Lender under this Section 9.06 are in addition to
other rights and remedies (including, without limitation, other rights of set-
off) which the Agent or any Lender may have.
SECTION 9.07 Sharing of Payments. If any Lender shall obtain any payment
(whether voluntary, involuntary, through the exercise of any right of set-off,
or otherwise) on account of the Advances made by it (other than pursuant to
Section 3.08 and Section 9.05(b)) in excess of its Pro Rata share of payments on
account of the Advances obtained by the other Lenders, such Lender shall
forthwith purchase from the other Lenders a participation in the Advances made
by them as shall be necessary to cause such purchasing Lender to share the
excess payment ratably with the other Lenders; provided; however, that if all or
any portion of such excess payment is thereafter received from such purchasing
Lender, such purchase from the other Lenders shall be rescinded to the extent of
such recovery and the other Lenders shall repay to the purchasing Lender that
proportion of the purchase price received by it equal to (A) the amount
recovered from the purchasing Lender, divided by (B) the total amount of the
participation purchased by the purchasing Lender, together with an amount equal
to each such Lender's Pro Rata Share of any interest or other amount payable by
the purchasing Lender in respect of the total amount so recovered. The Borrower
agrees that any Lender so purchasing a participation from any other Lender
pursuant to this Section 9.07 may, to the fullest extent permitted by law,
exercise all its rights of payment (including the right of set-off) with respect
to such participation as fully as if such Lender were the direct creditor of the
Borrower in the amount of such participation.
SECTION 9.08 Indemnification.
(a) The Borrower hereby indemnifies and holds the Agent and its Affiliates
and each Lender, their respective attorneys and agents (individually and
collectively referred to for purposes of this Section 9.08 as the "Indemnified
Parties") harmless from and against any and all claims (including, without
limitation, causes of action, cross-claims, counterclaims, rights of set-off and
recoupment), whether by any Affiliate or shareholder of the Borrower, or by any
creditor of the Borrower, or any Affiliate thereof, which are at any time
asserted against the Indemnified Parties (together with all Costs and Expenses
relating to the defense of such claims) arising out of, or relating to, the
Indemnified Parties' relationship or transactions with the Borrower or any of
its Affiliates, including, without limitation, (i) any claim for funds received
by the Agent or any of the Lenders and applied to the Obligations; (ii) any
claims contesting the validity or priority of the Liens granted to the Agent for
the benefit of the Lenders pursuant to the terms and provisions of any of the
Loan Documents; and (iii) any claims for actions taken or not taken by any of
the Indemnified Parties in connection with, or otherwise resulting from, whether
directly or indirectly, the negotiation, structuring, funding, issuance or
administration of the Advances, Letters of Credit and all other extensions of
credit by the Lenders to or on behalf of the Borrower; provided, however, that
the Agent and each Lender hereby agrees to refund to the Borrower any amounts
paid to the Agent or such Lender by the
42
Borrower pursuant to the foregoing indemnity to the extent that a court of
competent jurisdiction has found, pursuant to a "Final Order," as hereinafter
defined, that the liability asserted against the Indemnified Parties for which
such indemnity payment was made resulted primarily from the Indemnified Parties'
own willful misconduct or knowing and intentional violation (individually and
not as a co-conspirator with the Borrower or any of its Affiliates) of any
applicable law, rule or statute, which violation is punishable as a criminal
offense. As used herein, a "Final Order" shall mean an order entered by a court
of competent jurisdiction which is not interlocutory and as to which (i) the
time to appeal or petition for a writ of certiorari has expired with no appeals
or petitions for a writ of certiorari from such order having been taken, or (ii)
all appeals and petitions for writs of certiorari prosecuted from such order
have been exhausted. An used herein, "knowing and intentional" violation of a
law, rule or statute shall be interpreted to mean that an Indemnified Party had
knowledge both of the applicable law, rule or statute which it violated and that
its act was a violation of such law, rule or statute.
(b) The Borrower hereby agrees to reimburse the Indemnified Parties for all
Costs and Expenses incurred by the Indemnified Parties at any time from and
after the date hereof relating in any way to any and all claims which fall
within the scope of the Borrower's indemnity obligations pursuant to Section
9.08(a). All such Costs and Expenses shall be payable by the Borrower upon
demand. At each Lender's option, such Lender may reimburse itself for any such
Costs and Expenses, and the amount of any such reimbursement shall constitute
additional Obligations.
SECTION 9.09 Change in Accounting Principles. If any changes in accounting
principles from those used in the preparation of the financial statements
referred to in Section 6.01(e) are hereafter required or permitted by GAAP, and
are adopted by the Borrower with the agreement of its independent certified
public accountants, and such changes result in a change in the method of
calculation or the interpretation of any of the financial covenants, standards
or terms found in Article VII or any other provision of this Amended and
Restated Agreement, the Borrower and the Lenders agree to amend any such
affected terms and provisions to reflect such changes in GAAP with the result
that the criteria for evaluating the financial condition of the Borrower and its
consolidated subsidiaries shall be the same after such changes in GAAP as if
such changes had not been made.
SECTION 9.10 The Agent's Performance of Defaulted Acts. The Agent may, but
need not, following five (5) days prior notice to the Borrower and so long as
the Borrower shall have failed to have made such payment or perform such act in
a manner satisfactory to the Lenders, make any payment or perform any act herein
required of the Borrower in any form and manner deemed expedient by the Lenders.
All monies paid for any of the purposes herein authorized and all expenses paid
or incurred in connection therein, including reasonable attorney's fees shall
constitute Obligations and bear interest at the rate provided herein for Base
Rate Advances.
SECTION 9.11 Binding Effect; Assignments; Participations. This Amended and
Restated Agreement shall become effective when it shall have been executed by
the
43
Borrower, the Agent and each Lender and thereafter shall be binding upon and
inure to the benefit of the Borrower, the Agent, the Lenders and their
respective successors and assigns, except that the Borrower shall not have the
right to assign its rights hereunder or any interest herein without the prior
written consent of the Lenders. Each Lender may assign (in minimum amounts of
$5,000,000 and with the consent of the Borrower and the Agent) to one or more
banks or other entities all or any part or portion of, or may grant
participations to one or more banks or other entities in all or any part or
portion of its rights and obligations hereunder (including, without limitation,
its Commitment, its Note, its Advances or its Letters of Credit). Upon, and to
the extent of, any assignment (unless otherwise stated therein) made by a Lender
hereunder and payment of a processing fee in the amount of $3,000 to Agent for
its own account, the assignee or purchaser of such assignment shall be a Lender
hereunder for all purposes of this Amended and Restated Agreement. Without
limiting the foregoing, each assignee and each purchaser of an assignment or
participation shall, to the fullest extent permitted by law, have the same
rights and benefits hereunder with respect to the rights and benefits so
assigned or participated as it would have if it were a Lender hereunder.
SECTION 9.12 CHOICE OF LAW. THE LOAN DOCUMENTS SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS. ANY DISPUTE BETWEEN
THE BORROWER, THE AGENT OR ANY OF THE LENDERS ARISING OUT OF, CONNECTED WITH,
RELATED TO, OR INCIDENTAL TO THE RELATIONSHIP ESTABLISHED BETWEEN THEM IN
CONNECTION WITH ANY OF THE LOAN DOCUMENTS AND WHETHER ARISING IN CONTRACT, TORT,
EQUITY, OR OTHERWISE, SHALL BE RESOLVED IN ACCORDANCE WITH THE INTERNAL LAWS AND
DECISIONS AND NOT THE CONFLICTS OF LAW PROVISIONS OF THE STATE OF TEXAS.
SECTION 9.13 CONSENT TO JURISDICTION.
(a) EXCEPT AS PROVIDED IN SECTION 9.13(b), THE BORROWER, THE AGENT AND EACH
LENDER AGREE THAT ALL DISPUTES BETWEEN THEM ARISING OUT OF, CONNECTED WITH,
RELATED TO, OR INCIDENTAL TO THE RELATIONSHIP ESTABLISHED BETWEEN THEM IN
CONNECTION WITH ANY OF THE LOAN DOCUMENTS OR ANY OTHER INSTRUMENT, DOCUMENT OR
AGREEMENT EXECUTED OR DELIVERED IN CONNECTION THEREWITH OR THE TRANSACTIONS
RELATED THERETO AND WHETHER ARISING IN CONTRACT, TORT, EQUITY, OR OTHERWISE,
SHALL BE RESOLVED ONLY BY STATE OR FEDERAL COURTS LOCATED IN DALLAS COUNTY,
TEXAS, BUT THE BORROWER, THE AGENT AND EACH LENDER ACKNOWLEDGE THAT ANY APPEALS
FROM THOSE COURTS MAY HAVE TO BE HEARD BY A COURT LOCATED OUTSIDE OF DALLAS
COUNTY, TEXAS. THE BORROWER WAIVES IN ALL DISPUTES ANY OBJECTION THAT IT MAY
HAVE TO THE LOCATION OF THE COURT CONSIDERING THE DISPUTE.
(b) THE BORROWER AGREES THAT THE AGENT AND EACH LENDER SHALL HAVE THE RIGHT
TO PROCEED AGAINST THE BORROWER OR ITS PROPERTY IN A COURT IN ANY LOCATION TO
ENABLE SUCH PERSON TO ENFORCE A JUDGMENT OR OTHER COURT ORDER ENTERED IN FAVOR
OF SUCH PERSON. THE BORROWER AGREES THAT IT WILL NOT ASSERT ANY PERMISSIVE
COUNTERCLAIMS IN ANY PROCEEDING BROUGHT BY THE AGENT OR ANY LENDER TO REALIZE ON
THE BORROWER'S PROPERTY, THE BORROWER OR TO ENFORCE A JUDGMENT OR OTHER COURT
ORDER IN FAVOR OF SUCH PERSON. THE BORROWER WAIVES ANY OBJECTION THAT IT MAY
HAVE TO THE LOCATION OF THE COURT IN WHICH THE AGENT OR ANY LENDER HAS COMMENCED
A PROCEEDING DESCRIBED IN THIS PARAGRAPH.
SECTION 9.14 WAIVER OF JURY TRIAL. THE BORROWER, THE
44
AGENT AND EACH LENDER EACH WAIVE ANY RIGHT TO HAVE A JURY PARTICIPATE IN
RESOLVING ANY DISPUTE, WHETHER SOUNDING IN CONTRACT, TORT, OR OTHERWISE, BETWEEN
OR AMONG THE BORROWER, THE AGENT OR ANY OF THE LENDERS ARISING OUT OF, CONNECTED
WITH, RELATED TO OR INCIDENTAL TO THE RELATIONSHIP ESTABLISHED BETWEEN THEM IN
CONNECTION WITH ANY OF THE LOAN DOCUMENTS OR ANY OTHER INSTRUMENT, DOCUMENT OR
AGREEMENT EXECUTED OR DELIVERED IN CONNECTION THEREWITH OR THE TRANSACTIONS
RELATED THERETO. THE BORROWER, THE AGENT AND EACH LENDER HEREBY AGREE AND
CONSENT THAT ANY SUCH CLAIM, DEMAND, ACTION OR CAUSE OF ACTION SHALL BE DECIDED
BY COURT TRIAL WITHOUT JURY.
SECTION 9.15 Term. This Amended and Restated Agreement shall remain in full
force and effect until the later to occur of (i) the Termination Date, and (ii)
the repayment in full of all the Obligations and the extinguishment of all
Letters of Credit issued hereunder.
SECTION 9.16 Execution in Counterparts. This Amended and Restated Agreement
may be executed in any number of counterparts and by the different parties
hereto in separate counterparts, each of which when so executed shall be deemed
to be an original and all of which taken together shall constitute one and the
same agreement.
SECTION 9.17 Lenders' Creation of Security Interest. Notwithstanding any
other provision set forth in this Amended and Restated Agreement, any Lender may
at any time create a security interest in all or any portion of its rights under
this Amended and Restated Agreement (including, without limitation, Obligations
owing to it and the Note held by it) in favor of any Federal Reserve bank in
accordance with Regulation A of the Federal Reserve Board.
ARTICLE X
THE AGENT
SECTION 10.01 Appointment. Each Lender hereby designates and appoints
NationsBank as its Agent under the Loan Documents, and each Lender hereby
irrevocably authorizes the Agent to take such action on its behalf under the
provisions of the Loan Documents and to exercise such powers as are set forth
herein or therein, together with such other powers as are reasonably incidental
thereto. As to any matters not expressly provided for by this Amended and
Restated Agreement (including, without limitation, enforcement or collection of
the Notes), the Agent shall not be required to exercise any discretion or take
any action, but shall be required to act or to refrain from acting (and shall be
fully protected in so acting or refraining from acting) upon the instructions of
the Majority Lenders, and such instructions shall be binding upon all Lenders
and all holders of Notes; provided, however, that the Agent shall not be
required to take any action which exposes the Agent to personal liability or
which is contrary to any Loan Document or applicable law.
SECTION 10.02 Agent's Reliance. Etc. Neither the Agent nor any of its
Affiliates, directors, officers, agents or employees shall be liable for any
action taken or omitted to be taken by it or then under or in connection with
any Loan Document, except for its or their own gross negligence or willful
misconduct. Without limitation of the generality of the foregoing, the Agent:
(a) may treat the payee of any Note as the holder thereof until the Agent has
received
45
written notice of the assignment or transfer thereof signed by such payee and in
form satisfactory to the Agent (together with the processing fee described in
Section 9.11); (b) may consult with legal counsel (including counsel for the
Borrower), independent public accountants and other experts selected by it and
shall not be liable for any action taken or omitted to be taken in good faith by
it in accordance with the advice of such counsel, accountants or experts; (c)
makes no warranty or representation to any Lender and shall not be responsible
to any Lender for any statements, warranties or representations made in or in
connection with any Loan Document; (d) shall not have any duty to ascertain or
to inquire as to the performance or observance of any of the terms, covenants or
conditions of any Loan Document or to inspect the property (including the books
and records) of the Borrower; (e) shall not be responsible to any Lender for the
due execution, legality, validity, enforceability, genuineness, sufficiency or
value of any Loan Document or collateral covered thereby or any other instrument
or document furnished pursuant thereto; and (f) shall incur no liability under
or in respect of any Loan Document by acting upon any notice, consent,
certificate or other instrument or writing (which may be by telegram, cable,
telecopy or telex) believed by it to be genuine and signed or sent by the proper
party or parties.
SECTION 10.03 NationsBank and Affiliates. With respect to its Commitment,
the Advances made by it, the Note issued to it and the Letters of Credit by it,
NationsBank shall have the same rights and powers under the Loan Documents as
any other Lender and may exercise the same as though it were not the Agent, and
the term "Lender" or "Lenders" shall, unless otherwise expressly indicated,
include NationsBank in its individual capacity. NationsBank and its Affiliates
may accept deposits from, lend money to, act as trustee under indentures of, and
generally engage in any kind of business with, the Borrower and any person or
entity who may do business with or own securities of the Borrower, all as if
NationsBank were not the Agent and without any duty to account therefor to the
Lenders.
SECTION 10.04 Lender Credit Decision. Each Lender acknowledges that it has,
independently and without reliance upon the Agent or any of its Affiliates or
any other Lender and based on the financial statements referred to in Section
6.01 and such other documents and information as it has deemed appropriate, made
its own credit analysis and decision to enter into this Amended and Restated
Agreement. Each Lender also acknowledges that it will, independently and without
reliance upon the Agent or any of its Affiliates or any other Lender and based
on such documents and information an it shall deem appropriate at the time,
continue to make its own credit decisions in taking or not taking action under
the Loan Documents.
SECTION 10.05 Indemnification. The Lenders agree to indemnify the Agent and
its Affiliates (to the extent not reimbursed by the Borrower) ratably according
to their Pro Rata Shares, from and against any and all liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses and
disbursements of any kind or nature whatsoever which may be imposed on, incurred
by, or asserted against the Agent or any of its Affiliates in any way relating
to or arising out of any Loan Document, or any action taken or omitted by the
Agent or any of its Affiliates pursuant to the Loan Document, provided that no
Lender shall be liable for any portion of such liabilities,
46
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements resulting from the Agent's or any of its Affiliates'
gross negligence or willful misconduct. Without limitation of the foregoing,
each Lender agrees to reimburse the Agent and its Affiliates promptly upon
demand for its Pro Rata Share of any reasonable out-of-pocket expenses
(including counsel fees) incurred by the Agent or any of its Affiliates in
connection with the preparation, execution, administration, or enforcement of,
or legal advice in respect of rights or responsibilities under, the Loan
Documents, or any of them, to the extent that the Agent or such Affiliate is not
reimbursed for such expenses by the Borrower.
SECTION 10.06 Successor Agent. The Agent may resign at any time as Agent
under the Loan Documents by giving written notice thereof to the Lenders and the
Borrower. Upon any such resignation, all of the Lenders shall have the right to
appoint a successor Agent thereunder. If no successor Agent shall have been so
appointed by all of the Lenders, and shall have accepted such appointment within
thirty (30) days after the retiring Agent's giving of notice of resignation,
then the retiring Agent may, on behalf of the Lenders, appoint a successor
Agent, which shall be a commercial bank organized under the laws of the United
States of America or of any State thereof and having a combined capital and
surplus of at least $50,000,000. Upon the acceptance of any appointment as Agent
under the Loan Documents by a successor Agent, such successor Agent shall
thereupon succeed to and become vested with all the rights, powers, privileges
and duties of the retiring Agent, and the retiring Agent shall be discharged
from its duties and obligations under the Loan Documents. After any retiring
Agent's resignation or removal as Agent under the Loan Documents, the provisions
of this Article X shall continue to inure to its benefit as to any actions taken
or omitted to be taken by it while it was Agent under the Loan Documents.
SECTION 10.07 Invalidated Payments. If any amounts distributed by the Agent
to a Lender are subsequently returned or repaid by the Agent to the Borrower or
any of its representatives or successors in interest, whether by court order,
settlement or otherwise, such Lender shall, promptly upon its receipt of notice
thereof from the Agent, pay to the Agent such amount. If any such amounts are
recovered by the Agent from the Borrower or any of its representatives or
successors in interest, the Agent shall redistribute such recovered amounts to
the Lenders on the same basis as such amounts were originally distributed. The
obligations of the Lenders and the Agent under this Section 10.07 shall survive
the repayment of the Notes and the termination of the Loan Documents.
IN WITNESS WHEREOF, the parties hereto have caused this Amended and
Restated Agreement to be executed by their respective officers thereunto duly
authorized, as of the date first above written.
VICORP RESTAURANTS, INC.
By:/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Treasurer
Pro Rata Share: 75% NATIONSBANK OF TEXAS, N.A., as Agent and a
Lender
By:/s/ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇
------------------
▇▇▇▇▇▇▇▇▇ ▇▇▇▇
Vice President
Domestic and Eurodollar Lending Office:
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇▇▇ ▇▇▇▇
Pro Rata Share: 25% U.S. BANK NATIONAL ASSOCIATION,
D/B/A COLORADO NATIONAL BANK, as a Lender
By:/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
---------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Vice President
Domestic and Eurodollar Lending Office:
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
47
EXHIBIT A
NOTICE OF BORROWING
-------------------
TO: NationsBank of Texas, N.A. as agent (the "Agent") under that certain
Amended and Restated Credit Agreement dated as of December 19, 1997 by and
among VICORP Restaurants, Inc., a Colorado corporation (the "Borrower"),
the banks or other financial institutions listed on the signature pages
thereof (such banks or other financial institutions and their respective
successors and assigns being referred to collectively as the "Lenders") and
the Agent (said Credit Agreement, as the same may have been amended,
modified or supplemented from time to time, being hereinafter referred to
as the "Credit Agreement").
Capitalized terms when used herein and not otherwise defined herein shall
have the meaning ascribed to such terms in the Credit Agreement.
Pursuant to Section 3.02 of the Credit Agreement, the Borrower hereby gives
you notice, irrevocably, that the Borrower hereby requests a Borrowing under the
Credit Agreement and in that connection sets forth below the information
relating to such Borrowing (the "Proposed Borrowing") as required by Section
3.02(a) of the Credit Agreement:
(i) The date (which must be a Business Day) of the Proposed Borrowing is
__________________, 19___.
48
(ii) The Advances comprising the Proposed Borrowing are [Base Rate
Advances] [Eurodollar Rate Advances].
(iii) The aggregate amount of the Proposed Borrowing is
$_____________________.
(iv) The initial Interest Period for each Advance made as part of the
Proposed Borrowing is [________ month[s]].
The Borrower hereby certifies that the following statements are true on the
date hereof, and will be true on the date of the Proposed Borrowing:
(A) the representations and warranties contained in Section 6.01 of the Credit
Agreement are correct, before and after giving effect to the Proposed Borrowing
and to the application of the proceeds therefrom, as though made on and as of
such date; and
(B) no event has occurred and is continuing, or would result from such Proposed
Borrowing or from the application of the proceeds therefrom, which constitutes a
Default or an Event of Default.
Dated: _________________, 19____
VICORP RESTAURANTS, INC.
By:
---------------------
Title:
-----------------------------------
Use for Eurodollar Rate Advances.
EXHIBIT B
NOTICE OF CONVERSION/CONTINUATION
---------------------------------
TO: NationsBank of Texas, N.A. as agent (the "Agent") under that certain
Amended and Restated Credit Agreement dated as of December 19, 1997 by and
among VICORP Restaurants, Inc., a Colorado corporation (the "Borrower"),
the banks or other financial institutions listed on the signature pages
thereof (such banks or other financial institutions and their respective
successors and assigns being referred to collectively as the "Lenders") and
the Agent (said Credit Agreement, as the same may have been amended,
modified or supplemented from time to time, being hereinafter referred to
as the "Credit Agreement").
Capitalized terms when used herein and not otherwise defined herein shall
have the meaning ascribed to such terms in the Credit Agreement.
Pursuant to Section 3.03 of the Credit Agreement and effective as of
____________, 19____ this Notice of Conversion/Continuation ("Notice")
represents the Borrower's election to [insert one of the following]:
49
convert $_____________ in aggregate principal amount of Base Rate Advances
comprising the same Borrowing to Eurodollar Rate Advances. The initial Interest
Period for such Eurodollar Rate Advances is requested to be a _________________
(_________) month period.
convert $_________________ in aggregate principal amount of Eurodollar Rate
Advances comprising the same Borrowing to Base Rate Advances
on__________________. , 19__.
continue as Eurodollar Rate Advances $_______________ in aggregate
principal of presently outstanding Eurodollar Rate Advances comprising the same
Borrowing with a current Interest Period ending ______________, 19____. The
succeeding Interest Period is requested to be a _____________ (______________)
month period.
The Borrower hereby certifies that the following statements are true on the
date hereof, and will be true on the date of the [conversion] [continuation]
requested hereby:
(1.) the representations and warranties contained in Section 6.01 of the Credit
Agreement are correct, before and after giving effect to the [conversion]
[continuation] requested hereby and to the application of the proceeds
therefrom, as though made on and as of such date; and
(2.) no event has occurred and is continuing, or would result from such
[conversion] [continuation] or from the application of the proceeds therefrom,
which constitutes a Default or an Event of Default.
Dated: _________________, 19____.
---------------------------------------------------------------------
Insert Business Day on which conversion/continuation is to become
effective.
Use if converting Base Rate Advances to Eurodollar Rate Advances.
Use if converting Eurodollar Rate Advances to Base Rate Advances.
Use if continuing Eurodollas Rate Advances.
VICORP RESTAURANTS, INC.
By
--------------------
Title:
EXHIBIT C
REPLACEMENT REVOLVING LOAN NOTE
-------------------------------
U.S. $_________________ December 19, 1997
FOR VALUE RECEIVED, the undersigned, VICORP RESTAURANTS, INC., a Colorado
corporation (the "Borrower"), HEREBY PROMISES TO PAY to the order of
__________________________________________ (the "Lender") the principal sum of
_______________________________ DOLLARS or, if less, the aggregate unpaid
principal amount of all "Advances" (as defined in the "Credit Agreement" (as
defined below)) made by the Lender to the Borrower pursuant to the
50
Credit Agreement outstanding on the "Termination Date" (as defined in the Credit
Agreement).
The Borrower promises to pay interest on the unpaid principal amount of
each Advance from the date of such Advance until such principal amount is paid
in full, at such interest rates, and payable at such times, as are specified in
the Credit Agreement.
Both principal and interest are payable in lawful money of the United
States of America to the "Agent" (as defined in the Credit Agreement), for the
account of the Lender, at its principal office in Dallas, Texas, in same day
funds. Each Advance made by the Lender to the Borrower, and all prepayments made
on account of principal thereof, shall be recorded by the Lender and, prior to
any transfer hereof, endorsed on the grid attached hereto which is part of this
Promissory Note ("Note"), provided, however, that the Lender's failure to make
any such recordation or endorsement shall not operate to relieve Borrower of its
obligations to repay in full the unpaid principal amount hereof, together with
accrued interest thereon and all other amounts payable under the Credit
Agreement.
This Note is one of the Notes referred to in, and is entitled to the
benefits of, that certain Amended and Restated Credit Agreement dated as of
December 19, 1997 (as amended from time to time, the "Credit Agreement") by and
among the Borrower, the Lender and the other banks or other financial
institutions listed on the signature pages thereof (the Lender, together with
such other banks or other financial institutions and their respective successors
and assigns being referred to collectively as the "Lenders") and NationsBank of
Texas, N.A., a national banking association, in its capacity as agent for the
Lenders.
The Credit Agreement, among other things, (i) provides for the making of
Advances by the Lender to the Borrower from time to time in an aggregate amount
not to exceed at any time outstanding the U.S. dollar amount first above
mentioned, the indebtedness of the Borrower resulting from each such Advance
being evidenced by this Note, and (ii) contains provisions for acceleration of
the maturity hereof upon the happening of certain stated events and also for
prepayments on account of principal hereof prior to the maturity hereof upon the
terms and conditions therein specified.
This Note is issued as a replacement for, and as an extension [and
increase] of (but not a novation of) the Revolving Loan Note dated October 31,
1996, executed by the Borrower and payable to the order of the Lender in the
principal amount of $_________________.
VICORP RESTAURANTS, INC.
By:
---------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Treasurer
51
ADVANCES AND PAYMENTS OF PRINCIPAL
--------------------------------------------------------
Amount of Unpaid
Amount of Principal Notation
Date Advance Prepaid Balance Made By
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
EXHIBIT D
REQUEST FOR LETTER OF CREDIT
----------------------------
TO: NationsBank of Texas, N.A., as agent (the "Agent") under that certain
Amended and Restated Credit Agreement dated as of December 19, 1997 by and
among VICORP Restaurants, Inc., a Colorado corporation (the "Borrower"),
the banks or other financial institutions listed on the signature pages
thereof (such banks or other financial institutions and their respective
successors and assigns being referred to collectively as the "Lenders") and
the Agent (said Credit Agreement, as the same may have been amended,
modified or supplemented from time to time, being hereinafter referred to
as the "Credit Agreement").
Capitalized terms when used herein and not otherwise defined herein shall
have the meaning ascribed to such terms in the Credit Agreement.
The Borrower hereby gives you notice, irrevocably, pursuant to Section 4.04
of the Credit Agreement, that the Borrower hereby requests the Agent to issue a
Letter of Credit under the Credit Agreement, as such Letter of Credit is more
particularly described in the Letter of Credit Application attached hereto as
Annex A and in the form set forth in such Letter of Credit Application. In
connection with the requested Letter of Credit, the Borrower sets forth the
following information as required by Section 4.04 of the Credit Agreement:
(i) The stated amount of the requested Letter of Credit is
$________________.
(ii) The effective date of issuance of the requested Letter of Credit
(which must be a Business Day) is ____________.
(iii) The date on which the requested Letter of Credit is to expire (which
must be a Business Day occurring no more than 18 months following such
effective date and shall in no event be later than the Maturity Date unless
the Borrower provides the cash collateral required by Section 4.04(a)).
(iv) The beneficiary of the requested Letter of Credit is__________.
The Borrower hereby certifies that the following statements are true on the
date hereof, and will be true on the date of issuance of the Letter of Credit
requested hereby:
(A) the representations and warranties contained in Section 6.01 of the Credit
Agreement are correct, before and after giving effect to the issuance of such
Letter of Credit, as though made on and as of such date; and
52
(B) no event has occurred and is continuing, or would result from the issuance
of such Letter of Credit, which constitutes a Default or an Event of Default.
Dated: _____________, 19__
VICORP RESTAURANTS, INC.
By:
---------------------
Title:
-------------------------------
Attach as Annex A duly completed and executed Letter of Credit Application in
the form to be provided from time to time by the Agent, accompanied by the form
of the Letter of Credit requested to be issued.
EXHIBIT E
Form of Opinion of Counsel to the Borrower
------------------------------------------
[LETTERHEAD OF VICORP RESTAURANTS, INC.]
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇.▇. ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
(▇▇▇) ▇▇▇-▇▇▇▇
December 19, 1997
TO: The Agent and each of the Lenders which is a party to the Amended and
Restated Credit Agreement described below
RE: VICORP Restaurants, Inc.
Gentlemen:
This opinion is furnished to you pursuant to Section 5.01(a)(iv) of that certain
$40,000,000 Amended and Restated Credit Agreement (the "Credit Agreement"),
dated as of December 19, 1997, by and among VICORP Restaurants, Inc., a Colorado
corporation (the "Borrower"), the financial institutions party thereto
(collectively the "Lenders"), and NationsBank in its capacity as agent for the
Lenders (the "Agent").
Capitalized terms when used herein and not otherwise defined herein shall have
the meaning ascribed to such terms in the Credit Agreement.
I have acted as counsel for the Borrower in connection with the preparation,
execution and delivery of and the initial extensions of credit made under the
Credit Agreement.
In that connection, I have examined:
(1) The Credit Agreement and each of the other Loan Documents;
(2) The documents furnished by the Borrower pursuant to Article V of the Credit
Agreement;
53
(3) The Articles of Incorporation of the Borrower and all amendments thereto
(the "Charter"); and
(4) The by-laws of the Borrower and all amendments thereto (the "By-Laws").
I have also examined such other documents, corporate records, certificates of
public officials and other instruments and have conducted such other
investigations of fact and law as I deemed necessary or advisable for purposes
of this opinion. I have assumed the due execution and delivery, pursuant to due
authorization, of the Credit Agreement by the Agent and the Lenders.
I am qualified to practice law in the State of Colorado and I do not purport to
be an expert on any laws other than the laws of the State of Colorado and the
Federal laws of the United States. Insofar as the opinions expressed in
paragraphs 2, 3 and 4 below relate to matters which are governed by the laws of
the State of Texas, or other states, I have assumed (without negating my opinion
set forth in paragraph 7), with your consent, that the substantive law of the
State of Texas is the same as the substantive law of the State of Colorado.
Based upon the foregoing and upon such investigation as I have decided
necessary, I am of the following opinion:
1. The Borrower (i) is a corporation duly
organized, validly existing and in good standing under the laws of the
State of Colorado, and is duly qualified to do business, and is in good
standing as a foreign corporation, in each jurisdiction in which such
qualification is necessary or proper in view of its business and operations
or the ownership of its properties; (ii) does not own any material amount
of capital stock of, or have any other material equity investment in, any
Person other than its wholly-owned subsidiary, Vicorp Restaurants, Inc., a
corporation duly organized, validly existing and in good standing under the
laws of the State of Delaware, and the Borrower's ownership of 100,004
shares of Preferred Stock issued by a single issuer in replacement of a
subordinated debenture in the original principal amount of $10,000,000, and
(iii) has not (nor has any subsidiary) used or transacted business under
any other corporate or trade name in the past five years, except as
disclosed on Schedule 6.01(a) to the Credit Agreement. The Borrower has all
material approvals necessary to own its assets and carry on its business as
now being conducted and to enter into the Loan Documents.
2. The execution, delivery and performance by
the Borrower of the Loan Documents are within the Borrower's corporate
powers, have been duly authorized by all necessary corporate action, and do
not contravene (i) the Charter or the By-laws or (ii) any law, rule or
regulation applicable to the Borrower (including, without limitation,
Regulation X of the Board of Governors of the Federal Reserve System) or
(iii) any contractual or legal restriction contained in any indentures,
loans, or credit agreements and bonds, notes, orders, writs, judgments,
awards, injunctions, decrees or other agreements or instruments relating to
the Borrower of which, after diligent inquiry, I am aware. The Loan
Documents have been duly executed and delivered on behalf of the Borrower.
3. No authorization. approval or other action
54
by, and no notice to or filing with, any Governmental Authority or
regulatory body is required for the due execution, delivery and performance
by the Borrower of the Loan Documents.
4. The Loan Documents are legal, valid and
binding obligations of the Borrower enforceable against the Borrower in
accordance with their respective terms.
5. To the best of my knowledge, after diligent
inquiry, there are no pending or overtly threatened actions or proceedings
against the Borrower or any of its subsidiaries before any Governmental
Authority or arbitrator which purport to affect the legality, validity,
binding effect or enforceability of the Loan Documents or which are likely
to have a materially adverse effect upon the financial condition or
operations of the Borrower or any of its subsidiaries.
6. To the best of my knowledge, after diligent
inquiry, there is no default by the Borrower or any other party under any
material contract, lease agreement, instrument or commitment to which the
Borrower is a party.
7. In any action or proceeding arising out of or
relating to the Loan Documents in any court of the State of Colorado or in
any federal court sitting in the State of Colorado, such court would
recognize and give effect to the provisions of Section 9.12 of the Credit
Agreement wherein the parties thereto agree that the Loan Documents shall
be governed by, and construed in accordance with, the laws of the State of
Texas. Without limiting the generality of the foregoing, a court of the
State of Colorado or a federal court sitting in the State of Colorado would
apply the usury law of the State of Texas, and would not apply the usury
law of the State of Colorado, to the Loan Documents.
8. None of the Borrower or any of its ERISA
Affiliates maintains any employee welfare benefit plans within the meaning
of Section 3(l) of ERISA that provides benefits to employees after
termination of employment other than as required by Section 601 of ERISA.
9. None of the Borrower or any of its
subsidiaries is an "investment company" within the meaning of the
Investment Company Act of 1940, as amended.
The opinions set forth above are subject to the following qualifications.
(a) My opinion in paragraph 4 above is subject to the effect of any
applicable bankruptcy, insolvency, reorganization, moratorium or
similar law affecting creditors' rights generally.
(b) My opinion in paragraph 4 above is subject to the effect of
general principles of equity, including (without limitation) concepts
of materiality, reasonableness, good faith and fair dealing
(regardless of whether considered in a proceeding in equity or at
law).
Sincerely,
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇.
Senior Vice President
General Counsel
55
EXHIBIT F
LIST OF CLOSING DOCUMENTS
-------------------------
1. Amended and Restated Credit Agreement.
2. Replacement Revolving Loan Note payable to the order of NationsBank of Texas,
N.A., in the principal amount of $30,000,000.
3. Replacement Revolving Loan Note payable to the order of U.S. Bank National
Association, d/b/a Colorado National Bank, in the principal amount of
$10,000,000.
4. Certificate of the Secretary of the Borrower, (i) certifying the resolutions
of the Board of Directors of the Borrower approving the Loan Documents, (ii)
confirming the names and true signatures of the officers of the Borrower
authorized to sign the Loan Documents and (iii) confirming the accuracy and
currency of the Borrower's Articles of Incorporation and By-Laws previously
delivered to the Lenders.
5. Opinion of ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇., Vice President and General Counsel of the
Borrower, addressed to the Agent and the Lenders, substantially in the form of
Exhibit E.
6. Certificate of existence and good standing for the Borrower from the
Secretary of State of the State of Colorado.
7. Certificate of existence and good standing for the Borrower's subsidiary from
the Secretary of State of the State of Delaware.
8. Fee letter regarding fees payable to the Lenders and NationsBank.
9. Cancellation of the NationsBank Agreement and payment in full of all amounts
outstanding thereunder.
SCHEDULE 6.01(a)
TRADENAMES
----------
Angel's
Angel's Diner
Angel's Diner & Bakery
Bakers Square Restaurant
Bakers Square Restaurant & Bake Shop
Family Table
Village Inn Family Restaurant
Village Inn Pancake House
Village Inn Restaurant
56
November 18, 1998
VICORP Restaurants, Inc.
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇.
Re: Second Amendment to Amended and Restated Credit Agreement
Ladies and Gentlemen:
Reference is made to that certain $40,000,000 Amended and Restated Credit
Agreement dated as of December 19, 1997, as amended by the First Amendment to
Amended and Restated Credit Agreement dated October 5, 1998 (together, the
"Agreement"), among VICORP Restaurants, Inc. ("Borrower"), the financial
institutions named therein as lenders ("Lenders"), and NationsBank, N.A.
(successor by merger to NationsBank of Texas, N.A.), as Agent for Lenders
("Agent") Agreement.
For good and valuable consideration, the receipt and adequacy of which are
hereby acknowledged, Borrower, Agent and Lenders agree as follows:
1. Maximum Consolidated Capital Expenditures Section 7.03(c) of the
Agreement is hereby amended to read in its entirety as follows:
"(c) Maximum Consolidated Capital Expenditures. Not make or incur,
-----------------------------------------
and not permit any of its consolidated subsidiaries to make or incur,
Consolidated Capital Expenditures in any fiscal year in excess of
$35,000,000 provided that in the event the actual Consolidated Capital
Expenditures made or incurred during the applicable fiscal year are less
than $35,000,000 (such difference being referred to as a "Carry-Over
Amount'), the permitted amount solely with respect to the immediately
succeeding fiscal year shall be increased by the lesser of (i) $5,000,000
and (ii) such Carry-Over Amount."
2. Minimum Fixed Charge Coverage Ratio. Section 7.03(d) of the Agreement
is hereby amended to read in its entirety as follows:
"(d) Minimum Fixed Coverage Ratio. Maintain a ratio of (i) Adjusted
----------------------------
Consolidated EBITDAR to (ii) Consolidated Fixed Charges, determined as of
the last day of each fiscal quarter for the four fiscal quarters ending on
such day, of at least 1.50 to 1."
3. Consent. Lenders acknowledge that Borrower may request Agent to issue
-------
letters of credit under Article IV of the Agreement for the benefit of third
parties from time to time in an aggregate amount not to exceed $25,000
outstanding at anytime and that such letters of credit shall not be deemed to
violate Section 7.02(e) or 7.02(k) of the Agreement.
4. No Waiver of Defaults. Except as expressly set forth above, Borrower
---------------------
agrees that this letter does not constitute a waiver of, or a consent to, any
present or future violation of or noncompliance with any provision of any Loan
Document, or a waiver of Agent's and Lenders' right to insist upon future
compliance with each term, covenant, condition and provision of the Loan
Documents, and the Loan Documents shall continue to be binding upon, and inure
to the benefit of, Borrower, Agent and Lenders and their respective successors
and assigns.
5. Representations and Warranties. Borrower represents and warrants to
------------------------------
Agent and Lenders that (a) the execution and delivery of this letter have been
authorized by all requisite corporate action on its part and will not violate
its organizational documents, (b) the representations and warranties in each
Loan Document to which it is a party are true and correct in all material
respects on and as of the date hereof (except to the extent that (i) such
representations and warranties speak to a specific date or (ii) the facts on
which such representations and warranties are based have been changed by
transactions contemplated by the Loan Documents or this letter), and (c) it is
in full compliance with all covenants and agreements as contained in each Loan
Document to which it is a party (except for noncompliance permitted by this
letter).
6. Loan Document; Effect. This letter is a Loan Document, and,
---------------------
therefore, this letter is subject to the applicable provisions of Article IX of
the Agreement, all of which applicable provisions are incorporated herein by
reference the same as if set forth herein verbatim. Except as affected by this
letter, the Loan Documents are unchanged and continue in full force and effect.
Borrower agrees that all Loan Documents to which it is a party remain in full
force and effect and continue to evidence its legal, valid, and binding
obligations enforceable in accordance with their terms (as the same are affected
by this letter). Borrower hereby releases Agent and Lenders from any liability
for actions or failures to act in connection with the Loan Documents prior to
the date hereof. This letter shall be binding upon and inure to the benefit of
each of the undersigned and their respective successors and permitted assigns.
7. Multiple Counterparts. This letter may be executed in more than one
---------------------
counterpart, each of which when so executed shall be deemed to be an original,
but all of which when taken together shall constitute one and the same
instrument.
8. Fees and Expenses. Borrower agrees to pay the reasonable fees and
-----------------
expenses of counsel to Agent rendered in connection with the preparation,
negotiation and execution of this letter.
9. Final Agreement. LOAN DOCUMENTS, AS AMENDED HEREBY, REPRESENT THE
---------------
FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF
PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE
NO ORAL AGREEMENTS BETWEEN THE PARTIES.
This letter shall not become effective unless and until Agent receives
copies executed by Borrower, Agent and Majority Lenders in the spaces provided
below.
If you are in agreement with the foregoing, please so indicate by executing
the enclosed counterparts of this letter in the spaces provided below and
returning them to Agent to the attention of the officer named below.
Very truly yours,
NATIONSBANK, ▇.▇. ▇.▇. BANK NATIONAL ASSOCIATION
By:/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ By:/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
------------------------ ---------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Vice President Vice President
2
October 22, 1999
VICORP Restaurants, Inc.
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇.
Re: Amended and Restated Credit Agreement
Ladies and Gentlemen:
Reference is made to that certain $40,000,000 Amended and Restated Credit
Agreement dated as of December 19, 1997, as amended by the First Amendment dated
October 5, 1998, and the Second Amendment dated November 18, 1998 (collectively,
the "Agreement'), among VICORP Restaurants, Inc. (the "Borrower ") the financial
institutions named therein as lenders (the "Lenders"), and Bank of America,
N.A., successor by merger to NationsBank, N.A., as Agent for the Lenders (the
"Agent"). Unless otherwise indicated, all capitalized terms herein are used as
defined in the Agreement.
1. Section 7.02(h) of the Agreement provides that the Borrower and its
subsidiaries (a) may not dispose of any real property (except for certain
specified parcels), unless all of the Lenders consent, and (b) may not dispose
of other assets (except inventory and obsolete items, as described therein),
unless such sales aggregate less than $10,000,000 per year and the Aggregate
Commitment of the Lenders under the Agreement is permanently reduced by the
amount of all such proceeds in excess of $2,000,000 per year.
2. Notwithstanding the provisions of Section 7.02(h), the Borrower wishes
to enter into a sale/lease back transaction in an amount of up to $30,000,000
with respect to approximately 20 restaurant properties on terms and conditions
substantially consistent with the commitment letter dated July 28, 1999, from
CNL Fund Advisors, Inc. to the Borrower, and the First Amendment thereto dated
September 16, 1999 from CNL American Properties Fund, Inc., as successor by
merger to CNL Fund Advisors, Inc. (collectively, the "Commitment Letter"),
provided to the Agent, without reducing the Aggregate Commitment (the "Proposed
Transaction"). The Borrower has asked the Lenders not to exercise any of their
rights or remedies under the Loan Documents as a result of, and to waive any
Default and/or Event of Default caused by, the Proposed Transaction.
3. The Lenders hereby agree not to enforce their rights or remedies under
the Loan Documents as a result of, and hereby waive any Default and/or Event of
Default caused by, the Proposed Transaction, subject to the terms and conditions
set forth below.
4. In consideration of the foregoing waiver, the Borrower hereby agrees
that from the date hereof through the Maturity Date, neither the Borrower nor
its subsidiaries shall purchase, redeem or otherwise acquire for value any
shares of capital stock of the Borrower (or exchange shares of one class of
capital stock of the Borrower for another) without the prior written consent of
all of the Lenders, if the aggregate value of all such stock acquired or
exchanged during such period would exceed the lesser of (a) $30,000,000 or (b)
the net proceeds to the Borrower of the Proposed Transaction.
5. This letter shall not be effective until each of the following items
have been executed and have been delivered to the Agent:
(a) this letter signed by the Borrower, the Agent and the Lenders;
(b) the fully executed Commitment Letter; and
(c) such other documents as the Agent may reasonably request.
6. Except as expressly set forth above, the Borrower agrees that this
letter does not constitute a waiver of, or a consent to, any present or future
violation of or noncompliance with any provision of any Loan Document, or a
waiver of the Agent's and the Lenders' right to insist upon future compliance
with each term, covenant, condition and provision of the Loan Documents, and the
Loan Documents shall continue to be binding upon, and inure to the benefit of,
the Borrower, the Agent and the Lenders and their respective successors and
assigns.
7. The Borrower represents and warrants to the Agent and the Lenders that
(a) the execution and delivery of this letter have been authorized by all
requisite corporate action on its part and will not violate its organizational
documents, (b) the representations and warranties in each Loan Document to which
it is a party are true and correct in all material respects on and as of the
date hereof as though made on and as of the date hereof (except to the extent
that (i) such representations and warranties speak to a specific date or (ii)
the facts on which such representations and warranties are based have been
changed by transactions contemplated by the Loan Documents or this letter), (c)
it is in full compliance with all covenants and agreements contained in each
Loan Document to which it is a party, (d) the final terms and conditions of the
Proposed Transaction are substantially consistent with the Commitment Letter,
and (e) the final documentation for the Proposed Transaction shall be
substantially similar to, and on terms no less favorable to the Borrower and its
subsidiaries than, the forms of Purchase Agreement, Lease Agreement, Rent
Addendum, Memorandum of Lease and Assignment of Contract provided by the
Borrower to the Agent on October 20, 1999.
8. This letter is a Loan Document, and, therefore, this letter is subject
to the applicable provisions of Article IX of the Agreement, all of which
applicable provisions are incorporated herein by reference the same as if set
forth herein verbatim. Except as affected by this letter, the Loan Documents are
unchanged and continue in fall force and effect. The Borrower agrees that all
Loan Documents to which it is a party remain in full force and effect and
continue to evidence its legal, valid, and binding obligations enforceable in
accordance with their terms (as the same are affected by this letter). The
Borrower hereby releases the Agent and the Lenders from any liability for
actions or failures to act in connection with the Loan Documents prior to the
date hereof. This letter shall be binding upon and inure to the benefit of each
of the undersigned and their respective successors and permitted assigns.
9. This letter may be executed in more than one counterpart, each of
which when so executed shall be deemed to be an original, but all of which when
taken together shall constitute one and the same instrument.
10. The Borrower agrees to pay the reasonable fees and expenses of counsel
to the Agent rendered in connection with the preparation, negotiation and
execution of this letter.
11. THE LOAN DOCUMENTS, AS AMENDED HEREBY, REPRESENT THE FINAL AGREEMENT
BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED By EVIDENCE OF PRIOR,
CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO ORAL
AGREEMENTS BETWEEN THE PARTIES.
2
If you are in agreement with the foregoing, please so indicate by executing
the enclosed counterparts of this letter in the spaces provided below and
returning them to the Agent to the attention of the officer named below.
Very truly yours,
BANK OF AMERICA, ▇.▇. ▇.▇. BANK NATIONAL ASSOCIATION
By:/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, ▇▇. By:/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, ▇▇. Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Managing Director Title: Vice President
AGREED AND ACCEPTED:
VICORP RESTAURANTS, INC.
By:/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Treasurer
3
November 22, 1999
VICORP Restaurants, Inc.
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇.
Re: Third Amendment to Amended and Restated Credit Agreement
Ladies and Gentlemen:
Reference is made to this certain $40,000,000 Amended and Restated Credit
Agreement dated as of December 19, 1997, as modified by the First Amendment
dated October 5, 1998, the Second Amendment dated as of November 18, 1998, and
the Waiver Letter dated October 22, 1999 (collectively, the "Agreement"), among
VICORP Restaurants, Inc. (the "Borrower"), the financial institutions named
therein as lenders (the "Lenders"), and Bank of America, N.A., successor by
merger with NationsBank, N.A., as Agent for the Lenders (the "Agent"). Unless
otherwise indicated, all capitalized terms herein are used as defined in the
Agreement.
Whereas, the Borrower has informed the Lenders of the Borrower's intent to
offer to purchase up to 2,000,000 shares (subject to adjustment for
over-subscription) of the Borrower's common stock on substantially the terms and
conditions set forth in the Draft Offer To Purchase dated November 19, 1999 (the
"Tender Offer"), notwithstanding the provisions of the Agreement; and
Whereas, the Lenders are willing to allow the Borrower to proceed with the
Tender Offer, subject to the terms and conditions set forth herein;
Now, therefore and for good and valuable consideration, the receipt and
adequacy of which are hereby acknowledged, the Borrower, the Agent and the
Lenders agree as follows:
1. Consent to Tender Offer. The Lenders hereby consent to the Tender Offer and
-----------------------
waive any Default or Event of Default which would otherwise result from the
Tender Offer.
2. Definitions. Section 1.01 of the Agreement is hereby amended by adding the
-----------
following new definition in its appropriate alphabetical order:
"Tender Offer" means the offer by the Borrower to purchase up to
2,000,000 shares (subject to adjustment for over-subscription) of its
common stock on substantially the terms and conditions set forth in the
Draft Offer to Purchase dated November 19, 1999.
3. Year 2000 Compliant. Section 6.01 of the Agreement is hereby amended by
-------------------
adding the following new subsection (o) to the end of such Section:
(o) The Borrower has: (i) initiated a review and assessment of its
and its subsidiaries' business and operations (including third parties
considered critical to the Borrower's and its subsidiaries' operations)
that could be adversely affected by the "Year 2000 Problem" (that is, the
risk that computer applications used by Borrower or any of its subsidiaries
(or such third parties) may be unable to recognize and perform properly
date-
sensitive functions involving certain dates prior to, and any date after,
December 31, 1999); (ii) developed a plan and timeline for addressing the
Year 2000 Problem on a timely basis; and (iii) to date, implemented or are
implementing that plan in accordance with that timetable. Based on the
foregoing, the Borrower believes that all critical computer applications
that are material to the Borrower's or any of its subsidiaries' business
and operations are reasonably expected on a timely basis to be able to
perform properly date-sensitive functions for all dates before and after
January 1, 2000, except to the extent that a failure to do so could not
reasonably be expected to have a material adverse effect on the financial
condition or operations of the Borrower and its subsidiaries.
4. Use of proceeds. Section 7.01(j) of the Agreement is hereby amended to
---------------
read in its entirety as follows:
(j) Use of Proceeds. The Borrower will use the proceeds of the
---------------
Advances only to repay its obligations under the NationsBank Agreement, for
working capital, capital expenditures and other general corporate purposes
(including the purchase of shares of the Borrower's capital stock pursuant
to the Tender Offer), and for Permitted Asset Acquisitions.
5. Loans, Advances, Investments. Section 7.02(k) of the Agreement is hereby
----------------------------
amended by adding the following at the end of such Section:
and repurchases of the Borrower's capital stock pursuant to the Tender
Offer.
6. Minimum Consolidated Tangible Net Worth. Effective upon the consummation of
---------------------------------------
the Tender Offer, Section 7.03(b) of the Agreement is hereby amended in its
entirety to read as follows:
(b) Minimum Consolidated Tangible Net Worth. Maintain Consolidated
---------------------------------------
Tangible Net Worth, determined as of the last day of each fiscal quarter,
of at least (i) $90,000,000, plus (ii) an amount equal to the greater of
zero and 50% of the consolidated net earnings after taxes of the Borrower
and its subsidiaries determined in accordance with GAAP for the period
(taken as a single accounting period) from and including November 1, 1999,
to and including such day, plus (iii) an amount equal to 75% of any Net
Equity Issuance Proceeds for the period (taken as a single accounting
period) from and including November 1, 1999, to and including such day.
7. Minimum Fixed Charge Coverage Ratio. Effective upon the consummation of the
-----------------------------------
Tender Offer, Section 7.03(d) of the Agreement is hereby amended to read in its
entirety as follows:
(d) Minimum Fixed Charge Coverage Ratio. Maintain a ratio of (i)
-----------------------------------
Adjusted Consolidated EBITDAR to (ii) the sum of Consolidated Fixed Charges plus
the cash value of any dividend payment or other distribution of assets,
properties, cash, rights, obligations or securities on account of any shares of
preferred stock of the Borrower made by the Borrower or any of its subsidiaries,
determined in each case as of the last day of each fiscal quarter for the four
fiscal quarters ending on such day, of at least 1.50 to 1.
2
8. Covenant to Provide Pro Forma Financial Information. Prior to the
---------------------------------------------------
consummation of the Tender Offer, the Borrower shall provide the Lenders with a
certificate setting forth the pro forma effect of the Tender offer on the
consolidated balance sheet of the Borrower and its subsidiaries.
9. Conditions. This letter shall not be effective if a material adverse change
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has occurred and until each of the following items have occurred or been
delivered to the Agent:
(a) this letter signed by the Borrower and the Majority Lenders;
(b) the letter agreement between the Borrower and the Agent of even
date herewith, concerning certain fees and other related matters (the "Fee
Letter"); and
(c) such other documents, if any, as the Agent may reasonably
request.
10. No Waiver of Defaults. Except as expressly set forth above, the Borrower
---------------------
agrees that this letter does not constitute a waiver of, or a consent to, any
present or future violation of or noncompliance with any provision of any Loan
Document, or a waiver of the Agent's and the Lenders' right to insist upon
future compliance with each term, covenant, condition and provision of the Loan
Documents, and the Loan Documents shall continue to be binding upon, and inure
to the benefit of, the Borrower, the Agent and the Lenders and their respective
successors and assigns.
11. Representations and Warranties. The Borrower represents and warrants to the
------------------------------
Agent and the Lenders that (a) the execution and delivery of this letter have
been authorized by all requisite corporate action on its part and will not
violate its organizational documents, (b) the representations and warranties in
each Loan Document to which it is a party are true and correct in all material
respects on and as of the date hereof as though made on and as of the date
hereof (except to the extent that (i) such representations and warranties speak
to a specific date or (ii) the facts on which such representations and
warranties are based have been changed by transactions contemplated by the Loan
Documents or this letter), and (c) it is in full compliance with all covenants
and agreements contained in each Loan Document to which it is a party.
12. Loan Document; Effect. This letter is a Loan Document, and, therefore, this
---------------------
letter is subject to the applicable provisions of Article IX of the Agreement,
all of which applicable provisions are incorporated herein by reference the same
as if set forth herein verbatim. Except as affected by this letter, the Loan
Documents are unchanged and continue in full force and effect. The Borrower
agrees that all Loan Documents to which it is a party remain in full force and
effect and continue to evidence its legal, valid, and binding obligations
enforceable in accordance with their terms (as the same are affected by this
letter). The Borrower hereby releases the Agent and the Lenders from any
liability for actions or failures to act in connection with the Loan Documents
prior to the date hereof. This letter shall be binding upon and inure to the
benefit of each of the undersigned and their respective successors and permitted
assigns.
13. Multiple Counterparts. This letter may be executed in more than one
---------------------
counterpart, each of which when so executed shall be deemed to be an original,
but all of which when taken together shall constitute one and the same
instrument.
14. Fees and Expenses. The Borrower agrees to pay the reasonable fees and
-----------------
expenses of counsel to the Agent rendered in connection with the preparation,
negotiation and execution of this letter and the Fee Letter.
3
15. Final Agreement. This letter supercedes the Third Amendment to the Amended
---------------
and Restated Credit Agreement dated November 8, 1999, which is hereby declared
null and void. The Loan Documents, as amended hereby, represent the final
agreement between the parties and may not be contradicted by evidence of prior,
contemporaneous or subsequent oral agreements of the parties. There are no oral
agreements between the parties.
If you are in agreement with the foregoing, please so indicate by executing
the enclosed counterparts of this letter in the spaces provided below and
returning them to the Agent to the attention of the officer named below.
Very truly yours,
BANK OF AMERICA, ▇.▇. ▇.▇. BANK NATIONAL ASSOCIATION
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, ▇▇. By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, ▇▇. ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Managing Director Vice President
AGREED AND ACCEPTED:
VICORP RESTAURANTS, INC.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Treasurer
4