EXECUTION COPY
AMENDMENT AND WAIVER NO. 1 TO AMENDED AND RESTATED CREDIT
AND GUARANTY AGREEMENT
THIS AMENDMENT AND WAIVER NO. 1 TO AMENDED AND RESTATED CREDIT AND GUARANTY
AGREEMENT, dated as of April 30, 1996 (this "Amendment Agreement"), among E-Z
SERVE CONVENIENCE STORES, INC., a Delaware corporation (the "Borrower"), E-Z
SERVE CORPORATION, a Delaware corporation (the "Parent"), the Lenders (as
defined below) and SOCIETE GENERALE ("SG"), as agent (in such capacity, the
"Agent") for the Lenders,
W I T N E S S E T H:
- - - - - - - - - -
WHEREAS, the Borrow, the Parent, the various financial institutions parties
thereto (collectively, the "Lenders") and the Agent have heretofore entered
into a certain Amended and Restated Credit and Guaranty Agreement (amending
and restating the Credit and Guaranty Agreement, dated as of January 17,
1995), dated as of October 2, 1995 (the "Existing Credit Agreement" and, as
amended by the Limited Waiver Letter to Amended and Restated Credit and
Guaranty Agreement, dated April 11, 1996, and together with this Amendment
Agreement, the "Credit Agreement"); and
WHEREAS, the Borrower and the Guarantor desire to, among other things,
modify certain financial covenants and obtain a limited waiver in connection
with the foregoing from the Required Lenders, as more fully set forth herein;
and
WHEREAS, the Lenders are willing to consent to such amendments and limited
waiver, but only upon the terms and conditions set forth below (including
Article III);
NOW, THEREFORE, the parties hereto hereby agree as follows:
ARTICLE I
DEFINITIONS
Unless otherwise defined or the context otherwise requires, terms used in
this Amendment Agreement, including its preamble and recitals, have the
meanings provided in the Credit Agreement.
ARTICLE II
AMENDMENTS AND LIMITED WAIVER TO CERTAIN PROVISIONS OF
THE CREDIT AGREEMENT
Effective on (and subject to the occurrence of) the Effective Date (as
defined in Section 3.1), certain terms and provisions of the Existing Credit
Agreement are hereby waived, modified and amended in accordance with this
Article II. Except as so waived, modified and amended, the Existing Credit
Agreement shall continue in full force and effect in accordance with its
terms.
SECTION 2.1 Limited Waiver of Clause (e) of Section 3.1.2 of the
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Existing Credit Agreement.
--------------------------
Compliance by the Borrower and the Parent with clause (e) of Section 3.1.2 of
the Existing Credit Agreement is hereby waived for the month of March of the
1996 Fiscal Year (and solely for such month).
SECTION 2.2 Clause (a) of the definition of Capital Expenditure Level.
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The table appearing in clause (a) of the definition of Capital Expenditure
Level of the Existing Credit Agreement is hereby amended by deleting the entry
for the 1996 Fiscal Year thereto in its entirety and substituting the
following therefor:
Minimum EBITDA Minimum Fixed Charge
for Capital Coverage Ratio for
Fiscal Expenditure Capital Expenditure
Year Level I Level I
------ -------------- -------------------
"1996 $30,500,000 1.00:1.00"
SECTION 2.3 Amendments to Section 3.2.2 of the Existing Credit
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Agreement (Post-Default Rates).
-------------------------------
Section 3.2.2 of the Existing Credit Agreement is hereby amended by deleting
the words "on such amounts" appearing on the fourth line of such Section and
substituting the words "on all amounts payable hereunder" therefor.
SECTION 2.4 Amendments to Section 7.1.9 of the Existing Credit
--------------------------------------------------
Agreement (Springing Liens).
----------------------------
Section 7.1.9 of the Existing Credit Agreement is hereby amended in its
entirety by substituting the following therefor:
"SECTION 7.1.9 Springing Liens.
----------------
Within 60 days after (a) any judgement or order for the payment of money
is rendered against the Borrower or any of its Subsidiaries or any other
Obligor and an amount in excess of $1,000,000 in respect of such payment is
not covered in full by insurance maintained with responsible insurance
carriers, (b) the occurrence of any Event of Default,(c) the Funded Debt to
EBITDA Ratio being greater than (i) with respect to the third Fiscal Quarter
of the 1995 Fiscal Year, 4.50 to 1.00, (ii) with respect to the fourth Fiscal
Quarter of the 1995 Fiscal year, 3.55 to 1.00, (iii) with respect to the first
Fiscal Quarter of the 1997 Fiscal Year, 2.65 to 1.00, (iv) with respect to the
second Fiscal Quarter of the 1997 Fiscal Year, 2.40 to 1.00, (v) with respect
to the third Fiscal Quarter of 1997 Fiscal year, 2.15 to 1.00, and (vi) with
respect to the fourth Fiscal Quarter of the 1997 Fiscal year and thereafter,
1.90 to 1.00, or (d) with respect to any Fiscal Quarter of the 1996 Fiscal
Year, there is any Default with respect to any financial covenant contained in
this Agreement (clauses (a) through (f) of Section 7.2.4), the Borrower and
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the Parent shall immediately notify the Agent and each Lender in writing of
the occurrence of any of the foregoing events and the Borrower and the Parent
shall, and shall cause each of their respective Subsidiaries to, take all
steps necessary, at their own cost and expense, to (a) grant the Agent a first
priority leasehold Lien on operating facilities (including renewals) and a
first priority mortgage Lien on real property, fixtures, buildings and
improvements thereon (including the Sunshine properties after the Merger) and
(b) obtain title insurance coverage on such property in an amount, containing
such terms and exceptions and issued by an insurance company, acceptable to
the Agent in the Agent's reasonable discretion (together with such favorable
legal opinions with respect thereto as the Agent may reasonable request)."
SECTION 2.5 Amendments to clause (a) of Section 7.2.4 of the Existing
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Credit Agreement (Financial Condition).
---------------------------------------
Clause (a) of Section 7.2.4 of the Existing Credit Agreement is hereby amended
in its entirety by substituting the following therefor:
"(a) the Interest Coverage Ratio, as of the last day of each
Fiscal Quarter set forth below, to be less than the ratio set forth opposite
such Fiscal Quarter:
Minimum Interest
Fiscal Quarter Coverage Ratio
------------------------- --------------
The third and fourth
Fiscal Quarters of the
1995 Fiscal Year 3.00:1.00
Each Fiscal Quarter of
the 1996 Fiscal year 3.00:1.00
Each Fiscal Quarter of the
1997 Fiscal year 4.00:1.00
Each Fiscal Quarter of the
1998 Fiscal year 5.00:1.00
Each Fiscal Quarter of the
1999 Fiscal year and
thereafter 6.00:1.00"
SECTION 2.6 Amendments to clause (b) of Section 7.2.4 of the Existing
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Credit Agreement (Financial Condition).
---------------------------------------
Clause (b) of Section 7.2.4 of the Existing Credit Agreement is hereby amended
by deleting the third through sixth entries (for the 1996 Fiscal Year) of the
table thereto in their entirety by substituting the following new entries
therefor:
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Minimum Fixed Charge
Fiscal Quarter Coverage Ratio
-------------------------- --------------------
"The first Fiscal Quarter
of the 1996 Fiscal Year .60:1.00
The second Fiscal Quarter
of the 1996 Fiscal Year .60:1.00
The third Fiscal Quarter
of the 1996 Fiscal Year .80:1.00
The fourth Fiscal Quarter
of the 1996 Fiscal Year 1.00:1.00"
SECTION 2.7 Amendments to clause (d) of Section 7.2.4 of the Existing
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Credit Agreement (Financial Condition).
---------------------------------------
Clause (d) of Section 7.2.4 of the Existing Credit Agreement is hereby amended
in its entirety by substituting the following therefor:
"(d) the Funded Debt to EBITDA Ratio, as of the last day of each Fiscal
Quarter set forth below, to be greater than the ratio set forth opposite such
Fiscal Quarter:
Maximum Funded Debt
Fiscal Quarter to EBITDA Ratio
-------------------------- ---------------
The Third Fiscal Quarter
of the 1995 Fiscal Year 4.75:1.00
The Fourth Fiscal Quarter
of the 1995 Fiscal Year 3.75:1.00
The First Fiscal Quarter
of the 1996 Fiscal Year 3.55:1.00
The Second Fiscal Quarter
of the 1996 Fiscal Year 3.70:1.00
The Third Fiscal Quarter
of the 1996 Fiscal Year 3.35:1.00
The Fourth Fiscal Quarter
of the 1996 Fiscal Year 3.25:1.00
The First Fiscal Quarter
of the 1997 Fiscal Year 2.75:1.00
The Second Fiscal Quarter
of the 1997 Fiscal Year 2.50:1.00
The Third Fiscal Quarter
of the 1997 Fiscal Year 2.25:1.00
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Maximum Funded Debt
Fiscal Quarter to EBITDA Ratio
-------------------------- ---------------
The Fourth Fiscal Quarter
of the 1997 Fiscal Year 2.00:1.00
Each Fiscal Quarter of the
1998 Fiscal Year and 2.00:1.00
thereafter".
SECTION 2.8 Amendments to Section 7.2.7 of the Existing Credit
--------------------------------------------------
Agreement (Capital Expenditures).
---------------------------------
The entry for the 1996 Fiscal Year appearing in the table in clause (a) of
Section 7.2.7 of the Existing Credit Agreement is hereby amended by
substituting the following therefor:
Capital Capital Capital Capital
Fiscal Expenditure Expenditure Expenditure Expenditure
Year Level I Level II Level III Level IV
------ ----------- ------------ ----------- ------------
"1996 $11,400,000 $11,400,000 $11,400,000 $11,400,000"
SECTION 2.9 Amendments to Schedule III of the Existing Credit Agreement
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(Capital Expenditure Levels II and III).
----------------------------------------
Schedule III of the Existing Credit Agreement is hereby amended by deleting
the entry in the table thereto for the 1996 Fiscal Year and substituting the
following therefor:
Minimum Fixed Capital
Charge Expenditure
Fiscal Year Minimum EBITDA Coverage Ratio Level
----------- -------------- -------------- -----------
"1996 $27,400,000 1.00:1.00 II
1996 $24,400,000 1.00:1.00 III"
ARTICLE III
CONDITIONS PRECEDENT
SECTION 3.1 Conditions to Effectiveness of Article II.
------------------------------------------
The amendments and limited waiver set forth in Article II shall become
effective upon the prior or concurrent satisfaction of each of the conditions
precedent set forth in this Article III (the "Effective Date").
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SECTION 3.2 Amendment Fee and Expenses.
---------------------------
The Borrower shall have paid to the Agent, for the pro rata account of each
Lender in accordance with their respective Commitment Amounts, a non-refundable
amendment fee in the amount of $257,500.
SECTION 3.3 Opinion of Counsel.
-------------------
The Agent and the Lenders shall have received a legal opinion, dated the
Effective Date, in form and substance satisfactory to the Agent from Bracewell
& Patterson, L.L.P., as to such matters as the Agent may reasonably request.
SECTION 3.4 Execution of Counterparts.
--------------------------
The Agent shall have received counterparts of this Amendment Agreement duly
executed by the Borrower, the Parent, the Agent and the Required Lenders, and
duly acknowledged by Petroleum, each of which counterparts shall be deemed to
be an original and all of which shall constitute together but one and the same
agreement.
SECTION 3.5 Representations and Warranties.
-------------------------------
The Agent shall have received a certificate executed by the chief financial
Authorized Officer of each of the Parent and the Borrower certifying that the
representations and warranties set forth in Article VI of the Credit Agreement
and in the other Loan Documents are true and correct in all material respects
as of the applicable Effective Date, and that no Default or Event of Default
has occurred and is continuing.
SECTION 3.6 Satisfactory Legal Form.
------------------------
All documents executed or submitted pursuant hereto by or on behalf of the
Borrower, the Parent or any other Obligor shall be satisfactory in form and
substance to the Agent and its counsel; the Agent and its counsel shall have
received all information, approvals, opinions, documents or instruments as the
Agent or its counsel may reasonably request.
ARTICLE IV
REPRESENTATION; WARRANTIES AND COVENANTS
In order to induce the Lenders and the Agent to enter into this
Amendment Agreement, the Borrower and the Parent jointly and severally
represent and warrant unto the Agent, each Issuer and each Lender as set forth
in this Article IV.
SECTION 4.1 Compliance With Warranties.
---------------------------
The representations and warranties set forth in Article VI of the Credit
Agreement and in each other Loan Document delivered in connection herewith or
therewith are true and correct in all material respects with the same effect
as if made on and as of the Effective Date (unless stated to relate solely to
an earlier date).
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SECTION 4.2 Due Authorization, Non-Contravention, etc.
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The execution, delivery and performance by each of the Borrower, Petroleum and
the Parent of this Amendment Agreement and each Loan Document to be executed
by it in connection with the terms and conditions hereof, have been duly
authorized by all necessary corporate action, and do not (i) contravene the
Borrower's or the Parent's Organic Documents, (ii) contravene or result in a
default under any contractual restriction, law or governmental regulation or
court decree or order binding on or affecting the Borrower or the Parent or
(iii) result in, or require the creation or imposition of, any Lien (except as
contemplated in or created by the Loan Documents).
SECTION 4.3 Validity, etc.
--------------
This Amendment Agreement has each been duly executed and delivered and are,
and each other Loan Document to be executed and delivered by the Borrower,
Petroleum or the Parent, as the case may be, will, on the due execution and
delivery thereof, constitute, the legal, valid and binding obligations of the
Borrower and the Parent, as the case may be, enforceable in accordance with
their respective terms; subject in each case to the effect of any applicable
bankruptcy, insolvency, reorganization, moratorium or similar law affecting
creditors' rights generally, and subject to the effect of general principles
of equity (regardless of whether considered in a proceeding in equity or at
law). Each of such Loan Documents which purports to create a security
interest creates a valid first priority security interest in the Collateral
subject thereto, subject only to Liens permitted by Section 7.2.3., securing
the payment of the Obligations.
SECTION 4.4 No Material Adverse Change.
---------------------------
There has been no event or occurrence, nor has any fact or state of facts
existed, which could reasonably be expected to have a material adverse change
in the financial condition, operations, assets, business, properties, revenues
or prospects of the Parent and its Subsidiaries or the Borrower and its
Subsidiaries, taken as a whole.
SECTION 4.5 Compliance With Credit Agreement.
---------------------------------
As of the execution and delivery of this Amendment Agreement and as of the
Effective Date, each of the Borrower, the Parent and each other Obligor is in
compliance with all the terms and conditions of the Credit Agreement and the
other Loan Documents to be observed or performed by it, and no Default has
occurred and is continuing.
ARTICLE V
MISCELLANEOUS PROVISIONS
SECTION 5.1 Ratification of Existing Credit Agreement.
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The Existing Credit Agreement, as expressly amended by the terms hereof, is
hereby ratified, approved and confirmed in each and every respect. Except as
specifically amended herein, the Existing Credit Agreement shall continue in
full force and effect in accordance with the provisions thereof and except as
expressly set forth herein the provisions hereof shall not operate as a waiver
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of any right, power or privilege of the Agent and the Lenders nor shall the
entering into of this Amendment Agreement preclude the Lenders from refusing
to enter into any further or future amendments. This Amendment Agreement
shall be deemed to be a "Loan Document" for all purposes of the Credit
Agreement and all other Loan Documents.
SECTION 5.2 Consent and Acknowledgment of Guarantors, etc.
----------------------------------------------
By their signatures below, each of the Parent and Petroleum, each in their
capacity as a guarantor and (where applicable) as a grantor of collateral
security under a Loan Document, hereby acknowledge, consent and agree to this
Amendment Agreement and hereby ratify and confirm their respective obligations
under each guaranty and Loan Document executed and delivered by it in all
respects.
SECTION 5.3 Existing Credit Agreement, Referenced, etc.
-------------------------------------------
All references to the Existing Credit Agreement in any other document,
instrument, agreement or writing shall hereafter be deemed to refer to the
Existing Credit Agreement as modified hereby. As used in the Existing Credit
Agreement, the terms "Agreement", "herein", "hereinafter", "hereunder",
"hereto" and words of similar import shall mean, from and after the applicable
Effective Date, the Existing Credit Agreement as modified by this Amendment
Agreement.
SECTION 5.4 Expenses.
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The Borrower and the parent jointly and severally agree to pay all out-of-pocket
expenses incurred by the Agent in connection with the preparation,
negotiation, execution and delivery of this Amendment Agreement and related
documents, including, without limitation, the reasonable fees and other
charges of Mayer, Brown & Platt, counsel for the Agent.
SECTION 5.5 Headings.
---------
The various headings of this Amendment Agreement are inserted for convenience
only and shall not affect the meanings or interpretation of this Amendment
Agreement or any provisions hereof.
SECTION 5.6 Governing Law; Entire Agreement.
--------------------------------
THIS AMENDMENT AGREEMENT SHALL BE DEEMED TO BE A CONTRACT MADE UNDER AND
GOVERNED BY THE LAWS OF THE STATE OF NEW YORK. This Amendment Agreement
constitutes the entire understanding among the parties hereto with respect to
the subject matter hereof and supersedes any prior agreements, written or
oral, with respect thereto. This Amendment Agreement and the provisions
contained herein may be modified only by an instrument in writing executed by
the Borrower, the Agent and the Required Lenders.
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment
Agreement to be executed by their respective officers thereunto duly
authorized as of the day and year first above written.
E-Z SERVE CONVENIENCE STORES, INC.,
as the Borrower
By: /s/John T. Miller
-------------------------
Title: Senior Vice President
E-Z SERVE CORPORATION,
as the Guarantor/Parent
By: /s/John T. Miller
--------------------------
Title: Senior Vice President
SOCIETE GENERALE,
as the Agent
By: /s/Catherine A. Scaillier-Loiseau
--------------------------------
Title: Vice President
LENDERS:
------------
SOCIETE GENERALE
By: /s/Catherine A. Scaillier-Louiseau
-----------------------------------
Title: Vice President
BANK OF AMERICA TEXAS, N.A.
By: /s/Kim A. Ruth
-----------------------
Title: Vice President
PREMIER BANK, N.A.
By: /s/Lynn Richard
------------------------
Title: Vice President
AMSOUTH BANK OF ALABAMA
By: /s/Samuel M. Tortorici
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Title:
HELLER FINANCIAL, INC.
By: /s/Ray Trotta
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Title: Managing Director
THE FIRST NATIONAL BANK OF BOSTON
By: /s/H. Louis Bailey
-------------------------
Title: Vice President
ACKNOWLEDGED, CONFIRMED
AND AGREED TO WITH RESPECT
TO SECTION 5.2:
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E-Z SERVE PETROLEUM MARKETING, INC.
By: /s/John T. Miller
-----------------------
Title: Senior Vice President