EXHIBIT 10.16(c)
AMENDMENT NO. 2
DATED AS OF APRIL 28, 1998
TO THE
CREDIT AGREEMENT
DATED AS OF MAY 5, 1994
BETWEEN
ESKIMO PIE CORPORATION
AND
FIRST UNION NATIONAL BANK
TABLE OF CONTENTS
Page
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ARTICLE I
DEFINITIONS
Section 1.01 Definitions...................................................................1
ARTICLE II AMENDMENTS
Section 2.01 Amendments to the 1994 Credit Agreement.......................................1
ARTICLE III EFFECTIVENESS
Section 3.01 Effectiveness.................................................................3
ARTICLE IV MISCELLANEOUS
Section 4.01 Integration; Confirmation.....................................................3
Section 4.02 Expenses......................................................................4
Section 4.03 Counterparts..................................................................4
Section 4.04 Successors and Assigns........................................................4
Section 4.05 Governing Law.................................................................4
AMENDMENT NO. 2 (THIS "AMENDMENT") DATED AS OF APRIL 28,
1998 BETWEEN ESKIMO PIE CORPORATION AND FIRST UNION NATIONAL
BANK.
Eskimo Pie Corporation, a Virginia corporation (the "Company"),
and First Union National Bank, a national banking association (as successor by
merger to First Union National Bank of Virginia, the "Bank"), are parties to a
Credit Agreement dated as of May 5, 1994, as amended by Amendment No. 1 dated as
of April 18, 1997 (the "1994 Credit Agreement"). The Company and the Bank
propose to modify certain terms of the 1994 Credit Agreement to, among other
things, amend certain financial covenants and the interest rate calculation
provided for therein. Accordingly, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.01 DEFINITIONS. Terms used but not otherwise defined
herein which are defined in the 1994 Credit Agreement shall have for purposes
hereof the respective meanings set forth therein.
ARTICLE II
AMENDMENTS
SECTION 2.01 AMENDMENTS TO THE 1994 CREDIT AGREEMENT.
(a) Section 1.1 of the 1994 Credit Agreement is hereby amended by
inserting the following definitions in appropriate alphabetical order:
"Capital Ratio" means at any date the ratio of (i)
Consolidated Funded Debt of the Company and its Consolidated
Subsidiaries as of such date to (ii) Consolidated Total Capitalization
of the Company and its Consolidated Subsidiaries as of such date.
"Consolidated Total Capitalization" means at any date, the
sum of (i) the Debt of the Company and its Consolidated Subsidiaries,
determined on a consolidated basis as of such date plus (ii) the
Consolidated Net Worth of the Company and its Consolidated Subsidiaries
as of such date.
"Subordinated Notes" means the Convertible Subordinated
Notes issued by the Company on February 28, 1994 in favor of various
individuals in an aggregate principal amount equal to $3,800,000.
(b) The definition of "Applicable Margin" contained in Section
1.1 of the 1994 Credit Agreement is hereby amended to read in full as follows:
"Applicable Margin" means on any date (i) if the Fixed
Charge Coverage Ratio for the period ending on the most recent
Determination Date is greater than or equal to 2.0 to 1.0, the rate per
annum set forth under the caption "Applicable Margin" in the table
below, which shall be based upon the Capital Ratio for the most recent
Determination Date as specified below:
Capital Ratio Applicable Margin
Less than 0.20/1.0 37.5 basis points
0.20/1.0 to 0.299/1.0 50 basis points
0.30/1.0 to 0.40/1.0 75 basis points
Greater than 0.40/1.0 100 basis points
or (ii) if the Fixed Charge Coverage Ratio for the period ending on the
most recent Determination Date is less than 2.0 to 1.0, the rate per
annum set forth under the caption "Application Margin" in the table
below, which shall be based upon the Capital Ratio for the most recent
Determination Date as specified below:
Capital Ratio Applicable Margin
Less than 0.20/1.0 50 basis points
0.20/1.0 to 0.299/1.0 75 basis points
0.30/1.0 to 0.40/1.0 100 basis points
Greater than 0.40/1.0 125 basis points
The Applicable Margin shall be established at the end of (i) the fiscal
quarter ending on December 31, 1998 and, thereafter (ii) each fiscal
quarter of the Company (each, a "Determination Date"). Any change in the
Applicable Margin following each Determination Date shall be determined
based upon the financial statements delivered to the Bank pursuant to
Section 5.1(a) or (b), as applicable, and shall be effective commencing
on the date following the date such financial statements are received by
the Bank (or, if earlier, the date such financial statements were
required to be delivered to the Bank) and, in each case, until the date
following the date on which new financial statements are delivered or
are required to be delivered, whichever shall first occur; provided,
however, that if the Company shall fail to deliver any such financial
statements within the time period required by Section 5.1(a) or (b), as
applicable, then the Applicable Margin shall be 125 basis points until
the appropriate financial statements are so delivered. From April 1,
1998 to the first Determination Date, the Applicable Margin shall be 75
basis points.
(c) The definition of "Consolidated Fixed Charges" contained
in Section 1.1 of the 1994 Credit Agreement is hereby amended to read in full as
follows:
"Consolidated Fixed Charges" means, for any period
(without duplication), the sum of (i) Consolidated Interest Expense for
such period plus (ii) Current Maturities of Consolidated Funded Debt
determined as of the last day of such period plus (iii) Dividends paid
or payable during such period; provided that Consolidated Fixed Charges
for the six-month period ending June 30, 1998 (i) shall exclude the
aggregate amount of principal payments in respect of the Subordinated
Notes which are current liabilities as of such date and, otherwise, (ii)
shall include 1/2 of the aggregate amount of Current Maturities of
Consolidated Funded Debt determined as of the last day of such period;
and provided further that Consolidated Fixed Charges for the nine-month
period ending September 30, 1998 shall include 3/4 of the aggregate
amount of Current Maturities of Consolidated Funded Debt determined as
of the last day of such period.
(d) Section 6.3 of the 1994 Credit Agreement is hereby amended
to read in full as follows:
SECTION 6.3 FIXED CHARGE COVERAGE RATIO. The Fixed Charge
Coverage Ratio for (i) the six-month period ending June 30, 1998, (ii)
the nine-month period ending September 30, 1998, (iii) the twelve-month
period ending December 31, 1998 and (iv) any period of four consecutive
fiscal quarters thereafter of the Borrower (taken as a single accounting
period), will not be less than 1.5 to 1.0.
ARTICLE III
EFFECTIVENESS
SECTION 3.01 EFFECTIVENESS. This Amendment shall become
effective on the date (the "Effective Date") when the Bank shall have received
counterparts of this Amendment duly executed by itself and the Company. On the
Effective Date, the 1994 Credit Agreement will be automatically amended as set
forth herein.
ARTICLE IV
MISCELLANEOUS
SECTION 4.01 INTEGRATION; CONFIRMATION. On and after the
Effective Date, each reference in the 1994 Credit Agreement to "this Credit
Agreement", "this Agreement", "herein", "hereunder" or words of similar import,
and each reference to any other document delivered in connection with the "1994
Credit Agreement" shall be deemed to be of reference to the 1994 Credit
Agreement as amended by this Amendment; all other terms and provisions of the
1994 Credit Agreement shall continue in full force and effect and unchanged and
are hereby confirmed in all respects.
SECTION 4.02 EXPENSES. The Company shall reimburse the Bank for
any and all out-of-pocket expenses and charges paid or incurred by the Bank in
connection with the negotiation, preparation, execution and delivery (including
reasonable attorney's fees and disbursements of the Bank's special counsel) of
this Amendment.
SECTION 4.03 COUNTERPARTS. This Amendment may be signed in any
number of counterparts, each of which shall be an original, all of which taken
together shall constitute a single integrated agreement with the same effect as
if the signatures thereto and hereto were upon the same instrument. Complete
sets of counterparts shall be lodged with the Company and the Bank.
SECTION 4.04 SUCCESSORS AND ASSIGNS. The provisions of this
Amendment shall be binding upon and inure to the benefit of the parties hereto
and their respective heirs, executors, administrators, representatives,
successors and assigns.
SECTION 4.05 GOVERNING LAW. This Amendment shall be governed by
and construed in accordance with the laws of the Commonwealth of Virginia.
IN WITNESS WHEREOF, the parties hereto have caused this Amendment
to be duly executed as of the date first above written.
ESKIMO PIE CORPORATION
By: /s/ Thomas M. Mishoe, Jr.
--------------------------
Name: Thomas M. Mishoe, Jr.
Title: CFO, Treasurer and Secretary
901 Moorefield Park Drive
Richmond, Virginia 23236
Telecopier No.: 804-323-3740
with a copy to:
Jean Penick Watkins, Esquire
Mays & Valentine
NationsBank Plaza
12th and Main Streets
Richmond, Virginia 23219
Telecopier No.: (804) 697-1339
FIRST UNION NATIONAL BANK
By: /s/ David E. Brawley
-----------------------------
Name: David E. Brawley
Title: Assistant Vice President
7 North 8th Street
Richmond, Virginia 23219
Attn: David E. Brawley
Telecopier No.: (804) 343-6690
with a copy to:
Brian D. Murphy, Esq.
McGuire, Woods, Battle & Boothe LLP
One James Center
901 East Cary Street
Richmond, Virginia 23219
Telecopier No.: (804) 698-2127