Exhibit 10.48
AMENDMENT NO. 4 TO THE
CREDIT AGREEMENT
Dated as of December 27, 2001
AMENDMENT NO. 4 TO THE CREDIT AGREEMENT among Captain D's, Inc., a
Delaware corporation (the "Borrower"), the banks, financial institutions and
other institutional lenders parties to the Credit Agreement referred to below
(collectively, the "Lenders"), and Bank of America, N.A., as Administrative
Agent (the "Administrative Agent") for the Lenders.
PRELIMINARY STATEMENTS:
(1) The Borrower, the Lenders and the Administrative Agent have entered
into a Credit Agreement dated as of September 6, 2000, as amended by
Amendment No. 1 and Waiver to the Credit Agreement dated as of January 26,
2001, Amendment No. 2 dated as of April 2, 2001 and Amendment No. 3 dated as
of August 31, 2001 (such agreement as so amended, the "Credit Agreement").
Capitalized terms not otherwise defined in this Amendment have the same
meanings as specified in the Credit Agreement.
(2) The Borrower and the Lenders have agreed to amend the Credit
Agreement as hereinafter set forth.
SECTION 1. Amendments to Credit Agreement. The Credit Agreement is,
upon the occurrence of the Amendment No. 4 Effective Date (as hereinafter
defined), hereby amended as follows:
(a) The definition of "Applicable Margin" set forth in Section
1.01 is hereby amended in full to read as follows:
"`Applicable Margin' means, in respect of each of the
Facilities, (i) for the period from the Amendment No. 4 Effective
Date until January 31, 2002, 5.00% per annum; (ii) for the period
from February 1, 2002 until February 28, 2002, 6.00% per annum; and
(iii) thereafter, 7.00% per annum."
(b) The definition of "Termination Date" set forth in Section
1.01 is hereby amended by deleting each reference to the date
"December 31, 2001" therein and substituting for such reference the
reference to the date "March 31, 2002".
(c) The definition of "Net Cash Proceeds" set forth in Section
1.01 is hereby amended by deleting the last two provisos thereof.
(d) The definition of "Required Lenders" set forth in Section
1.01 is hereby amended by deleting the phrase "a majority in
interest" and replacing such phrase with the phrase "67%".
(e) Section 1.01 is hereby amended by adding in the correct
alphabetical order the following definition of "Amendment No. 4
Effective Date":
"`Amendment No. 4 Effective Date' has the meaning specified in
Amendment No. 4 to this Agreement dated as of December 27, 2001."
(f) Section 2.05(b) is hereby amended by adding at the end of
clause (ii) thereof the following new clause (iii):
"(iii) The Unused Working Capital Commitments shall be
automatically and permanently reduced, ratably among the Appropriate
Lenders in accordance with their Working Capital Commitments, on each
date on which any prepayment of the Working Capital Advances is made
pursuant to Section 2.06(b)(ii), by the amount of such prepayment."
(g) Sections 2.06(b)(ii) and (b)(iii) are hereby amended by
deleting the last sentence in each such section and replacing such
sentence with the following sentence:
"Each such prepayment shall be applied ratably to each of the
Facilities (and in the case of the Working Capital Facility, in the
manner set forth in clause (iv) below)."
(h) Section 2.08(a) is hereby amended by deleting clause (ii)
therein and replacing such clause with the new clause (ii) "(ii)
0.50% per annum;".
(i) Section 5.01(x) is hereby amended by adding at the end of
clause (vi) thereof the following new clauses (vii), (viii) and (ix):
"(vii) On or prior to January 20, 2002, host a conference call
of the Lenders to provide update on the status of the refinancing and
payment in full of the Facilities, and on or prior to February 20,
2002, host a meeting of the Lenders in a commercially reasonable
manner to review and discuss the plans and status of the refinancing
and payment in full of the Facilities, including detailed term sheets
in connection therewith.
"(viii) On or prior to February 1, 2002, at the Borrower's own
expense order for delivery no later than March 15, 2002 to the
Administrative Agent fully paid American Land Title Association
Lender's Extended Coverage title insurance policies or in lieu
thereof binding commitments therefor in form and substance, with
endorsements and in amount, acceptable to the Administrative Agent,
issued, coinsured and reinsured by title insurers acceptable to the
Administrative Agent, insuring the Post-Closing Mortgages (with
certain exceptions to be agreed by the Administrative Agent) to be
valid first and subsisting Liens on the properties listed on Schedule
5.01(x)(i), free and clear of all defects (including, but not limited
to, mechanics' and materialmen's Liens) and encumbrances, excepting
only Permitted Encumbrances, and providing for such other affirmative
insurance (including endorsements for future advances under the Loan
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Documents and for mechanics' and materialmen's Liens) and such
coinsurance and direct access reinsurance as the Administrative Agent
may deem necessary or desirable.
"(ix) Cooperate with and deliver to the Administrative Agent all
other documents, instruments and evidence that the Administrative
Agent or its title insurer may deem reasonably necessary in order to
(A) create valid first and subsisting Liens on the properties for
which the Post-Closing Mortgages have been delivered and (B) enable
the title insurer to deliver the title insurance policies described
in Section 5.01(x)(viii) above."
(j) Section 5.02(c) hereby is amended by adding at the end of
clause (ii) thereof the following new language:
"or other than any sublease by the Borrower to Captain D's of
Illinois, LLC".
(k) Section 5.02(e) hereby is amended by:
(i) adding at the end of subclause (ii)(B) thereof the following
new language:
", or the sublease by the Borrower to Captain D's of Illinois,
LLC, of a portion of the real property subject to the Master Lease
provided that Captain D's of Illinois, LLC, becomes a grantor under
the Security Agreement and a guarantor under the Subsidiary
Guaranty."
(ii) adding at the end of clause (ii) thereof the following new
subclause (F):
"and (F) the transfer of assets by the Borrower to Captain D's
of Illinois, LLC, provided that Captain D's of Illinois, LLC, becomes
a grantor under the Security Agreement and a guarantor under the
Subsidiary Guaranty."
(l) Section 5.04(a) is hereby amended in full to read as
follows:
"(a) Interest Coverage Ratio. Maintain as of the end of each
fiscal quarter of the Borrower a ratio of (i) Consolidated Adjusted
EBITDA of the Borrower and its Subsidiaries for the most recently
completed four fiscal quarter period to (ii) Interest Expense of the
Borrower and its Subsidiaries for such fiscal quarter of not less
than the ratio set forth below for such fiscal quarter:
FISCAL QUARTER ENDING RATIO
February 18, 2001 2.00:1.00
May 13, 2001 2.25:1.00
August 5, 2001 2.25:1.00
October 28, 2001 2.40:1.00
February 17, 2002 2.40:1.00
(m) Section 5.04(b) is hereby amended in full to read as
follows:
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"(b) Minimum Adjusted EBITDA. Maintain as of the end of the
fiscal quarter of the Borrower minimum Consolidated Adjusted EBITDA
of not less than the dollar amount set forth below for such fiscal
quarter:
FISCAL QUARTER ENDING AMOUNT
February 18, 2001 $34,000,000
May 13, 2001 $34,000,000
August 5, 2001 $34,000,000
October 28, 2001 $32,500,000
February 17, 2002 $32,500,000
(n) Section 5.04(c) is hereby amended in full to read as
follows:
"(c) Leverage Ratio. Maintain as of the end of each fiscal
quarter of the Borrower a Leverage Ratio of not more than the ratio
set forth below for such fiscal quarter:
FISCAL QUARTER ENDING RATIO
February 18, 2001 3.75:1.00
May 13, 2001 3.75:1.00
August 5, 2001 3.75:1.00
October 28, 2001 3.75:1.00
February 17, 2002 3.75:1.00
(o) Section 5.04(d) is hereby amended by adding to the table
therein a new row with the new ratio set forth below opposite the
following new date:
FISCAL QUARTER ENDING RATIO
--------------------- -----
February 17, 2002 1.50:1.00
(p) Schedule II to the Credit Agreement is hereby deleted in its
entirety.
SECTION 2. Conditions of Effectiveness. This Amendment shall become
effective as of the first date (the "Amendment No. 4 Effective Date") on
which each of the following conditions precedent shall have been satisfied:
(a) The Administrative Agent shall have received (i)
counterparts of this Amendment executed by the Borrower and the
Lenders or, as to any of the Lender Parties, advice satisfactory to
the Administrative Agent that such Lender Party has executed this
Amendment and (ii) the Consent attached hereto executed by each of
the parties thereto.
(b) The Administrative Agent shall have received on or before
the Amendment No. 4 Effective Date the following, each dated such
date (unless otherwise
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specified), in form and substance satisfactory to the Lenders (unless
otherwise specified) and in sufficient copies for each Lender Party:
(i) Certified copies of (A) the resolutions of the
Board of Directors of (1) the Borrower approving this
Amendment and the matters contemplated hereby and thereby
and (2) each other Loan Party evidencing approval of the
Consent and the matters contemplated hereby and thereby and
(B) all documents evidencing other necessary corporate
action and governmental and other third party approvals and
consents, if any, with respect to this Amendment, the
Consent and the matters contemplated hereby and thereby.
(ii) A certificate of the Borrower and each other Loan
Party, in each case signed on behalf of such Loan Party by
its President or a Vice President and its Secretary or any
Assistant Secretary, dated the Amendment No. 4 Effective
Date (the statements made in which certificate shall be true
on and as of the Amendment No. 4 Effective Date), certifying
as to (A) the absence of any amendments to the charter of
such Loan Party since the date of the Secretary of State's
certificate referred to in Section 3.01(k)(iii) of the
Credit Agreement, or any steps taken by the board of
directors (or persons performing similar functions) or the
shareholders of such Loan Party to effect or authorize any
further amendment, supplement or other modification thereto;
(B) the accuracy and completeness of the bylaws of such Loan
Party as in effect on the date on which the resolutions of
the board of directors (or persons performing similar
functions) of such Loan Party referred to in Section 2(b)(i)
hereof were adopted and on the Amendment No. 4 Effective
Date (a copy of which, if different from the bylaws of such
Loan Party delivered to the Lender Parties on the date of
the Initial Extension of Credit, shall be attached to such
certificate); (C) the due incorporation and good standing of
such Loan Party as a corporation organized under the laws of
the jurisdiction of its incorporation, and the absence of
any proceeding (either pending or contemplated) for the
dissolution, liquidation or other termination of the
existence of such Loan Party or any of its Subsidiaries; (D)
the accuracy in all material respects of the representations
and warranties made by such Loan Party in the Loan Documents
to which it is or is to be a party as though made on and as
of the Amendment No. 4 Effective Date (other than any such
representations or warranties that, by their terms, refer to
a specific date other than the Amendment No. 4 Effective
Date, in which case as of such specific date); and (E) the
absence of any event occurring and continuing that would
constitute a Default.
(iii) A certificate of the Secretary or an Assistant
Secretary of the Borrower and each other Loan Party
certifying the names and true signatures of the officers of
the Borrower and such other Loan Party authorized to sign
this Amendment and the Consent and the other documents to be
delivered hereunder and thereunder.
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(iv) Such financial, business and other information
regarding the Borrower and the Loan Parties and their
respective property, assets and businesses as the
Administrative Agent or the Lender Parties shall have
requested.
(v) A favorable opinion of Dinsmore & Shohl LLP,
counsel for the Borrower and the other Loan Parties, in form
and substance reasonably satisfactory to the Administrative
Agent.
(vi) Such other opinions, certificates, documents and
information as the Administrative Agent or the Lenders may
reasonably request.
(c) The representations and warranties contained in each of the
Loan Documents shall be correct in all material respects on and as
of the Amendment No. 4 Effective Date, as though made on and as of
such date (other than any such representations or warranties that,
by their terms, refer to a specific date other than the Amendment No.
4 Effective Date, in which case as of such specific date).
(d) No event shall have occurred and be continuing that
constitutes a Default.
(e) All of the accrued fees and expenses of the Administrative
Agent and the Lender Parties (including the accrued fees and expenses
of counsel for the Administrative Agent) shall have been paid in
full.
(f) The Borrower shall have paid to the Administrative Agent,
for the ratable account of each Lender and to be held in escrow and
disbursed by the Administrative Agent in accordance with Section 4
of this Amendment, an extension fee (the "Extension Fee") of 1% on
the aggregate Term B Commitment, Term C Commitment and Working
Capital Commitment of such Lender.
The effectiveness of this Amendment is further conditioned upon the
accuracy of all of the factual matters described herein. This Amendment is
subject to the provisions of Section 8.01 of the Credit Agreement, except
that no amendment or waiver of any provision of this Section 2, 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 Lenders.
SECTION 3.Reference to and Effect on the Credit Agreement and the Notes.
(a) On and after the effectiveness of this Amendment, each reference in the
Credit Agreement to "this Agreement", "hereunder", "hereof" or words of like
import referring to the Credit Agreement, and each reference in the Notes and
each of the other Loan Documents to "the Credit Agreement", "thereunder",
"thereof" or words of like import referring to the Credit Agreement, shall
mean and be a reference to the Credit Agreement, as amended by this
Amendment.
(b) The Credit Agreement, the Notes and each of the other Loan
Documents, as specifically amended by this Amendment, are and shall continue
to be in full force and effect and are hereby in all respects ratified and
confirmed. Without limiting the generality of the foregoing, the Collateral
Documents and all of the Collateral described therein do and shall continue
to secure the payment of all Obligations of the Loan Parties under the Loan
Documents, in each case as amended by this Amendment.
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(c) The execution, delivery and effectiveness of this Amendment shall
not, except as expressly provided herein, operate as a waiver of any right,
power or remedy of any Lender or the Administrative Agent under any of the
Loan Documents, nor constitute a waiver of any provision of any of the Loan
Documents.
SECTION 4.Disbursement of Extension Fee. The Borrower agrees that so
long as any Advance shall remain unpaid or any Letter of Credit or Commitment
shall be outstanding, 25% of the Extension Fee (as defined in Section 2(f)
hereof) with respect to each Lender shall be released from escrow and paid to
such Lender on January 2, 2002 and 75% of such Extension Fee shall be
released from escrow and paid to such Lender on January 31, 2002. In the
event that all Advances shall have been paid and all Commitments and Letters
of Credit shall have been terminated (i) prior to January 2, 2002, the
Administrative Agent shall return 100% of each Lender's Extension Fee to the
Borrower or apply such amount to the repayment of the Advances or (ii) on or
after January 2, 2002 but prior to January 31, 2002, the Administrative Agent
shall return 75% of each Lender's Extension Fee to the Borrower or apply such
amount to the repayment of the Advances.
SECTION 5.Costs and Expenses. The Borrower agrees to pay on demand all
costs and expenses of the Administrative Agent in connection with the
preparation, execution, delivery and administration, modification and
amendment of this Amendment and the other instruments and documents to be
delivered hereunder (including, without limitation, the reasonable fees and
expenses of counsel for the Administrative Agent) in accordance with the
terms of Section 8.04 of the Credit Agreement.
SECTION 6.Delivery of Post-Closing Mortgages.The Administrative Agent
hereby acknowledges that all Post-Closing Mortgages have been delivered by
the Borrower to the Administrative Agent.
SECTION 7.Execution in Counterparts. This Amendment may be executed in
any number of counterparts and by 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 but one and the
same agreement. Delivery of an executed counterpart of a signature page to
this Amendment by telecopier shall be effective as delivery of a manually
executed counterpart of this Amendment.
SECTION 8.Governing Law. This Amendment shall be governed by, and
construed in accordance with, the laws of the State of New York.
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
executed by their respective officers thereunto duly authorized, as of the
date first above written.
CAPTAIN D'S, INC.
By /s/ F. E. McDaniel, Jr.
------------------------------------------
Title: Vice President
BANK OF AMERICA, N.A.,
as Administrative Agent and as Lender
By /s/ Charles A. Kerr
-------------------------------------------
Title: Charles A. Kerr
Managing Director
BALANCED HIGH-YIELD FUND I, LTD.
BY: ING Capital Advisors LLC,
as Asset Manager
BY: /s/ Michael J. Campbell
-----------------------------------------
Name: Michael J. Campbell
Title: Managing Director
Captiva II Finance Ltd.
----------------------------------------------
(Please print or type name of institution)
By: /s/ David Dyer
------------------------------------------
Title: David Dyer
Director
CypressTree Investment Partners I, Ltd.
By: CypressTree Investment Management Company,
as Portfolio Manager
By: /s/ Jeffrey Megar
------------------------------------------
Name: Jeffrey Megar
Title: Principal
SENIOR DEBT PORTFOLIO
By: Boston Management and Research
as Investment Advisor
-----------------------------------------------
(Please print or type name of institution)
By: /s/ Scott H. Page
------------------------------------------
Title: Scott H. Page
Vice President
CypressTree Investment Management Company, Inc.
As: Attorney-in-Fact and on behalf of First
Allmerica Financial Life Insurance Company
as Portfolio Manager
By: /s/ Jeffrey Megar
-------------------------------------------
Name: Jeffrey Megar
Title: Principal
GENERAL ELECTRIC CAPITAL CORPORATION
By: /s/ Robert M. Kadlick
------------------------------------------
Name: Robert M. Kadlick
Title: Duly Authorized Signatory
KZH CYPRESSTREE-1 LLC
By: /s/ Anthony Iarrobino
------------------------------------------
Title: Anthony Iarrobino
Authorized Agent
KZH STERLING LLC
By: /s/ Anthony Iarrobino
------------------------------------------
Title: Anthony Iarrobino
Authorized Agent
ML CLO XII PILGRIM AMERICA (CAYMAN) LTD.
By: ING Pilgrim Investments LLC
as its investment manager -----------------------------------
(Please print or type name of
institution)
ML CLO XV PILGRIM AMERICA (CAYMAN) LTD.
By: ING Pilgrim Investments LLC
as its investment manager By: /s/ Brian S. Horton
------------------------------
ML CLO XX PILGRIM AMERICA (CAYMAN) LTD. Title: Brian S. Horton
By: ING Pilgrim Investments LLC Vice President
as its investment manager
MORGAN STANLEY PRIME INCOME TRUST
---------------------------------
(Please print or type name of institution)
By: /s/ Sheila A. Finnerty
---------------------------------------
Title: Sheila A. Finnerty
Executive Director
North American Senior Floating Rate Fund,
Inc.
By: Stanfield Capital Partners LLC
as Subadvisor
--------------------------------------------
(Please print or type name of institution)
By: /s/ Gregory L. Smith
----------------------------------------
Title: Gregory L. Smith
Partner
SEQUILS I, LTD
By: TCW Advisors, Inc. as its
Collateral Manager
By: /s/
----------------------------------------
Name:
Title:
SEQUILS IV, LTD
By: TCW Advisors, Inc. as its
Collateral Manager
By: /s/
-----------------------------------------
Name:
Title:
Transamerica Business Capital Corporation
By: /s/ Stephen Goetschius
------------------------------------------
Title: Stephen Boetschius
SVP
VAN KAMPEN
PRIME RATE INCOME TRUST
By: Van Kampen Investment Advisory Corp.
By: /s/ Brian T. Buscher
-----------------------------------------
Title: Brian T. Buscher
Manager Operations & Compliance
VAN KAMPEN
SENIOR FLOATING RATE FUND
By: Van Kampen Invesment Advisory Corp.
By: /s/ Brian T. Buscher
-----------------------------------------
Title: Brian T. Buscher
Manager Operations & Compliance
VAN KAMPEN
SENIOR INCOME TRUST
By: Van Kampen Invesment Advisory Corp.
By: /s/ Brian T. Buscher
-----------------------------------------
Title: Brian T. Buscher
Manager Operations & Compliance
CONSENT
Dated as of December 27, 2001
Each of the undersigned, Captain D's, Inc., a Delaware corporation,
Shoney's Inc., a Tennessee corporation, SHN Properties, LLC, a Delaware
limited liability company, Captain D's Realty, LLC, a Delaware limited
liability company, D's Equipment Co., Inc., a Tennessee corporation, Captain
D's Holdings, Inc., a Tennessee corporation, and Captain D's of Illinois,
LLC, a Tennessee limited liability company, to the extent it is (i) a Grantor
under the Security Agreement dated as of September 6, 2000 in favor of the
Administrative Agent and, for its benefit and the benefit of the Secured
Parties (as defined in the Credit Agreement referred to in the foregoing
Amendment), (ii) a Grantor under the Intellectual Property Security Agreement
dated as of September 6, 2000 in favor of the Administrative Agent and, for
its benefit and the benefit of the Secured Parties, (iii) a Pledgor under the
Pledge Agreement dated as of September 6, 2000 in favor of the Administrative
Agent and, for its benefit and the benefit of the Secured Parties and (iv) a
Subsidiary Guarantor under the Subsidiary Guaranty dated as of September 6,
2000 in favor of the Administrative Agent and, for its benefit and the
benefit of the Secured Parties, hereby consents to such Amendment and hereby
confirms and agrees that (a) notwithstanding the effectiveness of such
Amendment, each of the Loan Documents (as defined in the Credit Agreement
referred to in the foregoing Amendment) to which it is a party is, and shall
continue to be, in full force and effect and is hereby ratified and confirmed
in all respects, except that, on and after the effectiveness of such
Amendment, each reference in such Loan Documents to the "Credit Agreement",
"thereunder", "thereof" or words of like import shall mean and be a reference
to the Credit Agreement, as amended by such Amendment, and (b) the Collateral
Documents to which it is a party and all of the Collateral described therein
do, and shall continue to, secure the payment of all of the Secured
Obligations (in each case, as defined therein).
CAPTAIN D'S, INC.
By: /s/ F. E. McDaniel, Jr.
-----------------------------------
Title: Vice President
SHONEY'S, INC.
By: /s/ Donna M. Adams
-----------------------------------
Title: Vice President - Tax
SHN PROPERTIES, LLC
By: Captain D's, Inc., as Managing
Member
By: /s/ F. E. McDaniel, Jr.
-----------------------------------
Title: Vice President
CAPTAIN D's REALTY, LLC
By: Captain D's, Inc., as Managing
Member
By: /s/ F. E. McDaniel, Jr.
-----------------------------------
Title: Vice President
D'S EQUIPMENT CO., INC.
By: /s/ F. E. McDaniel, Jr.
-----------------------------------
Title: Vice President
CAPTAIN D'S HOLDINGS, INC.
By: /s/ F. E. McDaniel, Jr.
-----------------------------------
Title: President
CAPTAIN D'S OF ILLINOIS, LLC
By: Captain D's, Inc., its Sole Member
By: /s/ F. E. McDaniel, Jr.
-----------------------------------
Title: Vice President