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EXHIBIT 4.14
MODIFICATION AGREEMENT NO. 3
TO REIMBURSEMENT AGREEMENT AND TO STANDBY NOTE
THIS MODIFICATION AGREEMENT NO. 3 TO REIMBURSEMENT AGREEMENT AND
STANDBY NOTE (the "Modification No. 3") is made as of the 21st day of August,
1996, by and among SHONEY'S, INC. (the "Borrower"), a Tennessee corporation,
and NATIONSBANK OF TENNESSEE, N.A. ("NationsBank") (formerly known as Sovran
Bank/Central South), a national banking association having its principal place
of business in the City of Nashville, Tennessee, THE LONG-TERM CREDIT BANK OF
JAPAN, LIMITED, NEW YORK BRANCH ("LTCB"), a Japanese banking corporation acting
through its New York Branch with an office in the City of New York, New York,
KREDIETBANK, N.V., NEW YORK BRANCH ("Krediet"), a Belgian banking corporation
acting through its New York Branch with an office in the City of New York, New
York, and NATIONSBANK OF TENNESSEE, N.A. as agent for NationsBank, LTCB and
Krediet (in such capacity, the "Agent").
WITNESSETH:
WHEREAS, the parties heretofore entered into a Reimbursement
Agreement dated as of October 1, 1989 (the "Agreement"), as modified and
amended by a First Amendment to Reimbursement Agreement dated as of February 1,
1990 (the "Amendment"), a Modification Agreement No. 1 to Reimbursement
Agreement and Standby Note dated July 21, 1993 (the "Modification No. 1") and a
Modification Agreement No. 2 to Reimbursement Agreement and Standby Note dated
June 8, 1994 (the "Modification No. 2") (the Agreement, as modified and amended
by the Amendment, Modification No. 1 and Modification No. 2, is hereinafter
referred to as the "Reimbursement Agreement"); and
WHEREAS, pursuant to the Reimbursement Agreement, the Borrower has
issued its $13,305,555.56 Standby Promissory Note dated October 27, 1989 (the
"Note"), as modified and amended by Modification No. 1 and Modification No. 2
(the Note, as modified and amended by Modification No. 1 and Modification No.
2, is hereinafter referred to as the "Standby Note"); and
WHEREAS, the Borrower has requested that NationsBank, LTCB and
Krediet (collectively, the "Letter of Credit Issuers") and the Agent amend the
Standby Note as set forth herein; and
WHEREAS, the Letter of Credit Issuers and the Agent are willing to
amend such provisions, but only on the terms and conditions set forth herein,
NOW, THEREFORE, in consideration of the agreements herein contained,
the parties hereto hereby agree as follows:
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ARTICLE I.
DEFINITIONS
SECTION 1.1 CERTAIN DEFINITIONS. Unless otherwise defined herein or
the context otherwise requires, capitalized terms used in this Modification
No.3, including its preamble and recitals, have the following meanings (such
meanings to be equally applicable to the singular and plural forms thereof):
"AGENT" has the meaning assigned to such term in the preamble.
"AMENDMENT" has the meaning assigned to such term in the first
recital.
"BORROWER" has the meaning assigned to such term in the preamble.
"KREDIET" has the meaning assigned to such term in the preamble.
"LTCB" has the meaning assigned to such term in the preamble.
"LETTER OF CREDIT ISSUERS" has the meaning assigned to such term in
the third recital.
"MODIFICATION EFFECTIVE DATE" has the meaning assigned to such term
in Section 3.1.
"MODIFICATION NO. 1" has the meaning assigned to such term in the
first recital.
"MODIFICATION NO. 2" has the meaning assigned to such term in the
second recital.
"MODIFICATION NO.3" means this Modification Agreement No. 3 to
Standby Note.
"NATIONSBANK" has the meaning assigned to such term in the preamble.
"REIMBURSEMENT AGREEMENT" has the meaning assigned to such term in
the first recital.
"STANDBY NOTE" has the meaning assigned to such term in the second
recital.
SECTION 1.2. OTHER DEFINITIONS. Unless otherwise defined herein or
the context otherwise requires, capitalized terms used in this Modification No.
3, including its preamble and recitals, have the meanings assigned to such
terms in the Reimbursement Agreement.
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ARTICLE II.
MODIFICATION OF REIMBURSEMENT AGREEMENT
AND STANDBY NOTE AS OF
THE MODIFICATION EFFECTIVE DATE
Effective on (and subject to the occurrence of) the Modification
Effective Date, the provisions of the Reimbursement Agreement and the Standby
Note referred to below are hereby amended and modified in accordance with this
Article II. Except as expressly so amended, the Reimbursement Agreement and the
Standby Note shall continue in full force and effect in accordance with their
respective terms, and the Borrower hereby reaffirms its obligations under the
Reimbursement Agreement and the Standby Note as amended and modified hereby and
under the other Note Documents.
SECTION 2.1. MODIFICATION OF REIMBURSEMENT AGREEMENT. The
Reimbursement Agreement is hereby amended in the following manner:
SECTION 2.1.1. Subsection 3.02(a) of the Reimbursement
Agreement is hereby deleted and the following is inserted in lieu
therefor:
"(a) In addition to any other fees payable to the Letter of
Credit Issuers, the Borrower will pay to the Agent for the
benefit of the Letter of Credit Issuers in advance, on the
Date of Issuance and on each Commission Payment Date
thereafter until the Termination Date, a letter of credit fee
for the period from such Commission Payment Date (or, in the
case of the first such payment, the Date of Issuance) to and
including the day before the next Commission Payment Date, in
an amount equal to the product of (i) two percent (2%) per
annum (the "Fee Percentage") of the Stated Amount of the
Letter of Credit (as determined on such Commission Payment
Date) multiplied by (ii) a fraction, the numerator of which
equals the actual number of days from and including such
Commission Payment Date to and including the day before the
next Commission Payment Date and the denominator of which
equals the actual number of days in such year, provided,
however, that, upon the occurrence of the First Step-Down, the
Fee Percentage shall be reduced to one and three-quarters
percent (1-3/4%) per annum. The Borrower shall be entitled to
a pro-rata refund of such fee paid in advance if and to the
extent that the Stated Amount of the Letter of Credit is
reduced during the period for which such fee was prepaid
pursuant to the provisions of Section 5.10(b) of the Note
Issuance Agreement."
SECTION 2.2. MODIFICATION OF STANDBY NOTE. The Standby Note is hereby
amended in the following manner:
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SECTION 2.2.1. The date "September 1, 1996" appearing in the
fourth full paragraph of the Standby Note is hereby deleted and the
date "September 1, 1997" is inserted in lieu therefor.
ARTICLE III.
CONDITIONS TO EFFECTIVENESS
SECTION 3.1. MODIFICATION EFFECTIVE DATE. This Modification No. 3
shall become effective as of the date first above written (the "Modification
Effective Date") when the Agent shall have received counterparts of this
Modification No. 3 duly executed by the Borrower, the Agent and each of the
Letter of Credit Issuers.
ARTICLE IV.
MISCELLANEOUS
SECTION 4.1. CROSS REFERENCES. References in this Modification No. 3
to any article or section are, unless otherwise specified, to such article or
section of this Modification No. 3.
SECTION 4.2. INSTRUMENT PURSUANT TO REIMBURSEMENT AGREEMENT; LIMITED
WAIVER. This Modification No. 3 is a document executed pursuant to the
Reimbursement Agreement and shall (unless otherwise expressly indicated
therein) be construed, administered, and applied in accordance with all of the
terms and provisions of the Reimbursement Agreement. Any term or provision of
and any modification effected by this Modification No. 3 may be modified in any
manner by an instrument in writing executed by the parties hereto. Except as
expressly amended hereby, all of the representations, warranties, terms,
covenants, and conditions of the Reimbursement Agreement, the Standby Note and
the other Note Documents shall remain unmodified and unwaived. The
modifications set forth herein shall be limited precisely as provided for
herein to the provisions expressly modified herein.
SECTION 4.3. SUCCESSORS AND ASSIGNS. This Modification No. 3 shall be
binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns.
SECTION 4.4. COUNTERPARTS. This Modification No. 3 may be executed by
the parties hereto in several counterparts which shall be executed by the
Borrower, each of the Letter of Credit Issuers, and the Agent, as the case may
be, all of which shall be deemed to be an original and which shall constitute
together but one and the same agreement.
SECTION 4.5. AGREEMENT OF LETTER OF CREDIT ISSUERS. Without limiting
the generality of Section I of the Agreement of Banks made as of October 1,
1989, by and among the Letter of Credit Issuers and the Agent, each of the
Letter of Credit Issuers represents and warrants to each of the other Letter of
Credit Issuers and to the Agent that it has independently and without reliance
upon any representation made by either of the other Letter of Credit Issuers or
the Agent made its own decision to enter into this Modification No. 3 and that
it continues to make its own independent credit decisions with respect to the
Borrower.
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SECTION 4.6. EXPENSES. The Borrower hereby agrees that it will pay
all out-of-pocket expenses incurred by the Letter of Credit Issuers and the
Agent in connection with this Modification No. 3, including reasonable
attorneys' fees and expenses.
[REST OF PAGE INTENTIONALLY LEFT BLANK]
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IN WITNESS WHEREOF, the parties hereto have caused this Modification
No. 3 to be executed by their respective officers hereunder duly authorized as
of the day and year first above written.
SHONEY'S, INC.
BY: /S/ F.E. MCDANIEL, JR
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TITLE: TREASURER
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NATIONSBANK OF TENNESSEE, N.A.
(FORMERLY KNOWN AS SOVRAN BANK/CENTRAL SOUTH)
BY: /S/ STEVE L. DALTON
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TITLE:VICE PRESIDENT
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THE LONG-TERM CREDIT BANK OF JAPAN,
LIMITED, NEW YORK BRANCH
BY: /S/ JOHN J. SULLIVAN
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TITLE: JOINT GENERAL MANAGER
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KREDIETBANK, N.V., NEW YORK BRANCH
BY: /S/ ROBERT SNAUFFER /S/ TOD R. ANGUS
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TITLE: VICE PRESIDENT VICE PRESIDENT
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NATIONSBANK OF TENNESSEE, N.A.
(FORMERLY KNOWN AS SOVRAN BANK/CENTRAL SOUTH),
AS AGENT
BY: /S/ STEVE L. DALTON
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TITLE: VICE PRESIDENT
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