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EXHIBIT 10.25
NINTH AMENDMENT AND DEFERRAL TO
AMENDED AND RESTATED CREDIT AGREEMENT
NINTH AMENDMENT AND DEFERRAL (this "AMENDMENT"), dated as of July, 29,
1996, to the Amended and Restated Credit Agreement, dated as of October 8, 1993,
as amended by a First Amendment, dated as of January 20, 1994, a Second
Amendment, dated as of February 10, 1995, a Third Amendment, dated as of May 10,
1995, a Fourth Amendment, dated as of November 22, 1995, a Fifth Amendment,
dated as of February 12, 1996, a Sixth Amendment, Waiver and Deferral dated as
of April 12, 1996, a Seventh Amendment, Waiver and Deferral, dated as of May 30,
1996 and an Eighth Amendment, Waiver and Deferral, dated as of June 27, 1996 (as
so amended, the "CREDIT AGREEMENT"), among The Ground Round, Inc. (the "FIRST
BORROWER"), a Delaware corporation, GR of Minn., Inc., a Delaware corporation
(the "SECOND BORROWER", and together with the First Borrower, the "BORROWERS"),
the banks named therein (the "BANKS"), The Bank of New York, as Agent (the
"AGENT") and The Chase Manhattan Bank (formerly known as Chemical Bank), as
Co-Agent.
PRELIMINARY STATEMENTS:
A. The Credit Agreement amended and restated the Amended and Restated
Credit Agreement, dated as of April 26, 1992, among the Borrowers, the banks
named therein and Citibank, N.A., as original agent.
B. The Borrowers desire to amend the Credit Agreement to (i) permit the
Borrowers to further defer payment of the principal of the Tranche A Term
Advances (which was originally due and payable on April 15, 1996 and which was
previously deferred to July 31, 1996 pursuant to the Eighth Amendment) to
September 13, 1996, (ii) permit the Borrowers to further defer the payment of
certain net proceeds of sale from certain restaurants as described in Section 1
herein to September 13, 1996, (iii) permit the Borrowers to defer the payment of
a certain fee payable pursuant to the terms of Section 2.07(e) of the Credit
Agreement to September 13, 1996, and (iv) prohibit Eurodollar Rate Advances
maturing after September 13, 1996.
C. The Lenders and the Agent are willing to amend the Credit Agreement with
respect to the foregoing subject to the terms and conditions contained herein.
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D. Unless otherwise defined herein, all terms defined in the Credit
Agreement shall be used herein as therein defined.
In consideration of the covenants, conditions and agreements
hereinafter set forth, and for other good and valuable consideration, the
receipt and adequacy of which are hereby acknowledged, the parties agree as
follows:
SECTION 1. Deferrals.
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Subject to the satisfaction of the conditions set forth in Section 3 hereof
and so long as no Event of Default shall have occurred and be continuing under
the Credit Agreement, the Agent and the Lenders hereby agree to permit the
Borrowers (a) to defer to September 13, 1996 the payment of the principal of the
Tranche A Term Advances that is due and payable on July 31, 1996, (b) to defer
to September 13, 1996 the payment of 75% of Net Cash Proceeds of the sale of the
two restaurants located at Madeira, Ohio and Worcester, Massachusetts,
respectively, that is due and payable on July 31, 1996, which payment shall be
applied in accordance with the terms of Section 2.05(b)(ii) of the Credit
Agreement (c) to defer to September 13, 1996 the payment of $1,000,000 of the
Net Cash Proceeds of certain asset sales permitted to be retained by the
Borrowers pursuant to Section 3 of the Eighth Amendment and (d) to defer to
September 13, 1996 the payment of the restructuring fee that is due and payable
on July 31, 1996 pursuant to the terms of Section 2.07(e) of the Credit
Agreement.
SECTION 2. Amendments to Credit Agreement.
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The Credit Agreement is, effective as of the date hereof, subject to the
satisfaction of the conditions precedent set forth in Section 3 below, hereby
amended as follows:
(a) Section 1.01 is hereby amended by inserting the following new
definition:
"`NINTH AMENDMENT': means the Ninth Amendment and Deferral, dated as of
July 29, 1996, to this Agreement".
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(b) Section 1.01 is hereby amended by deleting subsection (e) at the end of
the definition of "INTEREST PERIOD" and inserting in lieu thereof the following
new subsection (e):
"(e) notwithstanding anything to the contrary above, neither Borrower may
select any Interest Period that ends after September 13, 1996."
SECTION 3. Conditions of Effectiveness.
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This Amendment shall become effective as of the date hereof, PROVIDED, that
the Agent shall have received counterparts of (i) this Amendment executed by the
Borrowers, the Lenders and the Agent, (ii) the Consent appended hereto (the
"CONSENT") executed by each of the Guarantors, and (iii) such other documents as
the Agent shall reasonably request.
SECTION 4. Representations and Warranties.
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The Borrowers hereby (a) reaffirm and admit the validity and enforceability
of the Loan Documents and all of their obligations thereunder, (b) agree and
admit that they have no defenses to or offsets against any of their obligations
to the Agent or any Lender under the Loan Documents, and (c) represent and
warrant that there exists no Default or Event of Default and that the
representations and warranties contained in the Credit Agreement are true and
correct on and as of the date hereof.
SECTION 5. Reference to and Effect on the Loan Documents.
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(a) Upon the effectiveness of this Amendment, on and after the date hereof,
each reference in the Credit Agreement to "this Agreement", "hereunder",
"hereof", "herein", or words of like import, and each reference in the other
Loan Documents to the Credit Agreement, shall mean and be a reference to the
Credit Agreement as amended hereby;
(b) Except as specifically amended or waived above, the Credit Agreement
and the Notes, and all other Loan Documents, shall remain in full force and
effect and are hereby ratified and confirmed. Without limiting the generality of
the foregoing, the Collateral Documents and all Collateral described therein
shall
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continue to secure the payment of the obligations of the Borrowers thereunder,
under the Credit Agreement, as amended hereby, and under the Notes and other
Loan Documents; and
(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 Agent under any of the Loan Documents, nor, except
as provided herein, constitute a waiver of any provision of any of the Loan
Documents.
SECTION 6. Costs and Expenses.
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The Borrowers agree to pay on demand all reasonable costs and expenses of
the Agent in connection with the arranging, preparation, reproduction, execution
and delivery of this Amendment and the other instruments and documents to be
delivered hereunder, including the reasonable fees and expenses of Zalkin, Rodin
& Goodman, LLP, special counsel for the Agent, with respect thereto, and of
local counsel, if any, who may be retained by said special counsel with respect
thereto.
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SECTION 7. Counterparts.
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This Amendment may be executed in any number of counterparts and by
different parties hereto in separate counterparts, each of which shall be an
original and all of which together shall constitute but one and the same
document.
SECTION 8. Governing Law.
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This Amendment is intended to be performed in the State of New York and
shall be construed and is enforceable in accordance with, and shall be governed
by, the internal laws of the State of New York without regard to principles of
conflict of laws.
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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.
THE GROUND ROUND, INC.
By:
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Name:
Title:
GR OF MINN., INC.
By:
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Name:
Title:
THE BANK OF NEW YORK,
Individually and as Agent
By:
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Name:
Title:
THE CHASE MANHATTAN BANK, Individually and
as Co-Agent
By:
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Name:
Title:
BANK OF AMERICA ILLINOIS
By:
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Name:
Title:
NBD BANK
By:
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Name:
Title:
CREDIT LYONNAIS NEW YORK BRANCH
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By:
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Name:
Title:
CREDIT LYONNAIS CAYMAN ISLAND BRANCH
By:
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Name:
Title:
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CONSENT OF GUARANTORS
DATED AS OF JULY 29, 1996
The undersigned, as the Guarantors referred to in the foregoing Ninth
Amendment and Deferral, dated as of July 29, 1996, to the Amended and Restated
Credit Agreement, dated as of October 8, 1993, as amended by a First Amendment,
dated as of January 20, 1994, a Second Amendment, dated as of February 10, 1995,
a Third Amendment dated as of May 10, 1995, a Fourth Amendment dated as of
November 22, 1995, a Fifth Amendment, dated as of February 12, 1996, a Sixth
Amendment, Waiver and Deferral, dated as of April 12, 1996, a Seventh Amendment,
Waiver and Deferral, dated as of May 30, 1996 and an Eighth Amendment, Waiver
and Deferral dated as of June 27, 1996 among The Ground Round, Inc., GR of
Minn., Inc., the banks named therein, The Bank of New York, as Agent, and
Chemical Bank as Co-Agent, each hereby consents to the foregoing Amendment and
hereby confirms and agrees that, notwithstanding the effectiveness of said
Amendment, (i) the Guarantors have no defenses to or offsets against any of
their obligations to the Agent or any Lender under any Loan Document and the
Guaranty and each Collateral Document in effect on the date hereof to which it
is a party are, and shall continue to be, in full force and effect and are
hereby confirmed and ratified in all respects, except that, upon the
effectiveness of, and after the date of, said Amendment, all references in the
Guaranty and each such Collateral Document to the Credit Agreement shall mean
the Credit Agreement as amended by said Amendment and (ii) such Collateral
Documents consisting of security agreements and all collateral described therein
do, and shall continue to, secure the payments by the Borrowers referred to in
said Amendment of their obligations under the Credit Agreement, as amended by
said Amendment, and under the Notes.
GRH OF NJ, INC.
By:
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Name:
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Title:
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GROUND ROUND HOLDINGS, INC.
By:
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Name:
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Title:
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GROUND ROUND RESTAURANTS, INC.
By:
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Name:
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Title:
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G.R. GLENDLOC, INCORPORATED
By:
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Name:
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Title:
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GROUND ROUND OF BALTIMORE, INC.
By:
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Name:
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Title:
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GRXR OF BEL AIR, INC.
By:
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Name:
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Title:
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GRXR OF FREDERICK, INC.
By:
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Name:
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Title:
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GRXR OF HAGERSTOWN, INC.
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By:
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Name:
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Title:
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