Exhibit 4.04(i)
SEVENTH AMENDMENT TO SECOND AMENDED AND RESTATED
REVOLVING CREDIT AND TERM LOAN AGREEMENT
This SEVENTH AMENDMENT (this "Amendment"), dated as of June 27, 1997, by
and among MORTON'S RESTAURANT GROUP, INC., a Delaware corporation (formerly
known as Quantum Restaurant Group, Inc.) having its principal place of business
at Suite 210, 3333 New Hyde Park Road, New Hyde Park, New York 11042 (referred
to below and in the Credit Agreement, as defined below, as "Quantum"), PEASANT
HOLDING CORP., a Delaware corporation having its principal place of business at
Suite 210, 3333 New Hyde Park Road, New Hyde Park, New York 11042 ("Peasant
Holding"), MORTON'S OF CHICAGO, INC., an Illinois corporation with its principal
place of business at 350 West Hubbard Street, Chicago, Illinois 60610
("Morton's") (Quantum, Peasant Holding and Morton's are referred to herein
collectively as the "Borrowers", and each, individually, as a "Borrower"),
BANKBOSTON, N.A. (formerly known as The First National Bank of Boston), as Agent
(the "Agent") for the Lenders (as defined in the Credit Agreement referred to
below), BANKBOSTON, N.A. (formerly known as The First National Bank of Boston
and referred to below and in the Credit Agreement, as defined below, as "FNBB")
in its individual capacity as a Lender, IMPERIAL BANK, as a Lender, and HELLER
FINANCIAL, INC., as a Lender, amends the Second Amended and Restated Revolving
Credit and Term Loan Agreement dated as of June 19, 1995, as amended by the
First Amendment dated as of February 14, 1996, the Second Amendment dated as of
March 5, 1996, a letter agreement dated as of May 2, 1996, the Third Amendment
dated as of June 28, 1996 (the "Third Amendment"), the Fourth Amendment dated as
of December 26, 1996, the Fifth Amendment dated as of December 31, 1996, the
Sixth Amendment dated as of February 6, 1997, and as the same may be further
amended, modified, or supplemented from time to time (the "Credit Agreement"),
by and among the Borrowers, the Agent, and the Lenders. Capitalized terms used
but not defined herein shall have the meanings set forth in the Credit
Agreement.
WHEREAS, the Borrowers have requested the Lenders agree to increase the
Revolving Credit Commitment Amount, to extend the maturity of the credit
facilities provided for in the Credit Agreement, and to amend certain other
provisions of the Credit Agreement; and
WHEREAS, the Agent and the Lenders, subject to the terms and provisions
hereof, have agreed to so amend the Credit Agreement;
NOW THEREFORE, the parties hereto hereby agree as follows:
ss.1. Amendments to Credit Agreement. Subject to the satisfaction of the
conditions precedent set forth in ss.3 hereof, the Credit Agreement is hereby
amended as follows:
ss.1.1. Changes in Certain Definitions.
(a) The definition of Available Net Cash Proceeds in Section 1 of the
Credit Agreement (as added by the Third Amendment to the Credit Agreement and as
previously amended) is hereby amended to read as follows:
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"Available Net Cash Proceeds. As to any particular transaction
consisting of a Permitted Disposition, 75% of the Net Cash Proceeds
thereof."
(b) The table contained in the definition of Commitment Percentages in
Section 1 of the Credit Agreement is hereby amended to read as follows:
"Lender Percentage"
------ ----------
"FNBB 64.28571%"
"Imperial Bank 35.71428%"
(c) The definition of Final Maturity Date in Section 1 of the Credit
Agreement is hereby amended to read as follows:
"Final Maturity Date. December 31, 2002."
(d) The definition of Revolving Credit Commitment in Section 1 of the
Credit Agreement is hereby amended by replacing the phrase "of FNBB is Fifteen
Million Dollars ($15,000,000)" with the phrase "is Seventeen Million Five
Hundred Thousand Dollars ($17,500,000)".
(e) The definition of Revolving Credit Commitment Amount in Section 1 of
the Credit Agreement is hereby amended by replacing the phrase "Fifteen Million
Dollars ($15,000,000)" with the phrase "Seventeen Million Five Hundred Thousand
Dollars ($17,500,000)".
(f) The table contained in the definition of Term Loan Percentage in
Section 1 of the Credit Agreement (as added by the Fifth Amendment to the Credit
Agreement) is hereby amended to read as follows:
"Lender Percentage"
------ ----------
"FNBB 41.66667%"
"Heller Financial, Inc. 33.33333%"
"Imperial Bank 25.00000%"
ss.1.2. Mandatory Commitment Reductions. Section 2.l(b)(iii) of the Credit
Agreement (as added by the Third Amendment to the Credit Agreement) is hereby
amended to read as follows:
"(iii) Mandatory Reductions. The Revolving Credit Commitment Amount
shall be automatically and immediately reduced from time to time by the
Revolving Credit Share of the Available Net Cash Proceeds (if any)
received by the Companies in respect of each Permitted Disposition, in
each case allocated pro rata among the Lenders in accordance with their
respective Commitment Percentages (the "Mandatory Reductions"). No such
reduction of the Revolving Credit Commitment Amount shall be subject to
reinstatement."
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ss.1.3. Interest on Revolving Credit Loans. The table contained in Section
2.4(b) of the Credit Agreement is hereby amended to read as follows:
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Applicable
Applicable Eurodollar
Base Rate Margin Rate Margin
Leverage Ratio (per annum) (per annum)
------------------------------------------------
>1.25:1.0 0.75% 2.75%
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<= 1.25:1.0 and 0.25% 2.25%
>1.00:1.0
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<= 1.00:1.0 and 0% 2.00%
>0.75:1.0
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<= 0.75:1.0 and 0% 1.75%
>0.50:1.0
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<= 0.50:1.0 and 0% 1.375%
>0.35:1.0
------------------------------------------------
<= 0.35:1.0 0% 0.875%
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ss.1.4. Term Loan Principal Payments.
(a) Section 2.6(c) of the Credit Agreement is hereby amended to read as
follows:
"(c) Repayments of Principal of Term Loan.
(i) Scheduled Payments. The Borrowers jointly and severally promise
to pay to the Agent for the ratable accounts of the Lenders the principal
of the Term Loan in quarterly installments of $1,000,000 per installment,
each due and payable on the last day of each calendar quarter of each
calendar year, commencing June 30, 1999, and with a final payment due and
payable on the Final Maturity Date in an amount equal to the then unpaid
principal balance of the Term Loan.
(ii) Mandatory Prepayments. The Borrowers jointly and severally
shall be obligated to make prepayments in respect of the principal of the
Term Loan immediately at the time of each Permitted Disposition in an
amount equal to the Term Loan Share of the Available Net Cash Proceeds (if
any) received by the Companies in respect of such Permitted Disposition,
in each case payable to the Agent for application in respect of the Term
Loan to the ratable accounts of the Lenders (the "Mandatory Prepayments").
Prior to the earlier to occur of (A) the aggregate cumulative amount of
principal repaid or prepaid in respect of the Term Loan being equal to at
least $1,500,000, or (B) September 30, 1999, the Mandatory Prepayments
shall be applied against the scheduled unpaid installments of principal
due in respect of the Term Loan in the direct order of their maturity;
otherwise, any and all Mandatory Prepayments made hereunder shall be
applied against the scheduled unpaid installments of principal due in
respect of the Term Loan in the inverse order of their maturity. No such
Mandatory Prepayments with respect to the Term Loan may be reborrowed."
(b) Section 2.6(d) of the Credit Agreement is hereby amended by deleting
the third and fourth sentence thereof and inserting in their places the
following:
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"Prior to the earlier to occur of (A) the aggregate amount of principal
repaid or prepaid in respect of the Term Loan being equal to at least
$1,500,000, or (B) September 30, 1999, prepayments hereunder shall be
applied against the scheduled unpaid installments of principal due in
respect of the Term Loan in the direct order of their maturity; otherwise,
any and all prepayments made hereunder shall be applied against the
scheduled unpaid installments of principal due in respect of the Term Loan
in the inverse order of their maturity. No such amount repaid or prepaid
with respect to the Term Loan may be reborrowed."
ss.1.5. Commitment Fee. Section 4.5 of the Credit Agreement is hereby
amended by replacing the number "$5,000,000" with the number "$7,500,000".
ss.1.6. Letter of Credit Fee. Section 4A.6 of the Credit Agreement is
hereby amended to read as follows:
"ss.4.A.6. Letter of Credit Fees. The Borrowers shall pay to the Agent and
the Lenders in respect of each Letter of Credit the following fees (the "Letter
of Credit Fees"): (a) a fee (in each case, a "Basic Letter of Credit Fee")
payable to the Agent quarterly in arrears, on the last day of each calendar
quarter, determined in respect of each Letter of Credit (but without duplication
for any applicable period for which the Basic Letter of Credit Fee is paid or
payable), equal to the sum of (i) the Applicable Rate (as defined below), minus
one-eighth of one percent (.125%) per annum, of the Maximum Drawing Amount from
time to time outstanding of such Letter of Credit, payable for the ratable
accounts of the Lenders in accordance with their respective Commitment
Percentages plus (ii) one-eighth of one percent (.125%) per annum of the Maximum
Drawing Amount from time to time outstanding of such Letter of Credit, payable
for the sole account of the Agent as a fronting fee, and (b) on the date of
issuance, and at the time of each extension, renewal, amendment, and transfer of
each Letter of Credit and at such other time or times as such processing charges
are customarily made by the Agent, the Agent's customary issuance, extension,
renewal, amendment, transfer or similar processing fee as then are generally
charged by the Agent in connection with similar letter of credit facilities to
similar customers, payable to the Agent for its own account. If the Agent shall
ever be obligated to refund to the Borrowers any amount of the Basic Letter of
Credit Fees previously received from the Borrowers and distributed to any other
Lender hereunder, such other Lender shall immediately upon demand repay such
amounts to the Agent. For the purposes of this ss.4A.6, "Applicable Rate" shall
mean the percentage rate per annum from time to time in effect that the
Borrowers would pay with respect to Eurodollar Rate Loans as the applicable
margin over the Eurodollar Rate as set forth in ss.2.4 of this Agreement. The
foregoing Basic Letter of Credit Fee, being payable in arrears, shall not be
payable with respect to periods for which the Basic Letter of Credit Fee has
already been paid in advance pursuant to the provisions of this Agreement as in
effect prior to the effectiveness of the Seventh Amendment hereto dated as of
June 27, 1997."
ss.1.7. Capitalized Leases. Section 10.1(f) of the Credit Agreement is
hereby amended by deleting the figure "$10,000,000" and inserting in its place
the figure "$19,000,000".
ss.1.8. Guaranties. For the avoidance of doubt, the parties confirm that
(notwithstanding anything to the contrary contained or implied in Section 3 of
the Credit Agreement) all of the Obligations are guaranteed under, and entitled
to the benefits of, each of the Guaranties, without regard to whether such
Obligations arise with respect to any direct or indirect parent entity of the
applicable Guarantors or otherwise.
ss.2. Representations and Warranties. The Borrowers hereby represent and
warrant to the Agent and the Lenders as follows:
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(a) Representations and Warranties in Credit Agreement. Except as
specified in writing by the Borrowers to the Agent with respect to
the subject matter of this Amendment prior to the execution and
delivery hereof by the Agent and the Lenders, the representations
and warranties of the Borrowers contained in the Credit Agreement
were true and correct in all material respects when made and
continue to be true and correct in all material respects on the date
hereof except, in each case to the extent of changes resulting from
transactions contemplated or permitted by the Loan Documents and
this Amendment and changes occurring in the ordinary course of
business which singly or in the aggregate are not materially
adverse, and to the extent that such representations and warranties
relate expressly to an earlier date.
(b) Authority, No Conflicts, Enforceability of Obligations, Etc. Each of
the Borrowers hereby confirms that the representations and
warranties of the Borrowers contained in ss.ss.6.l, 6.3 and 6.4 of
the Credit Agreement are true and correct on and as of the date
hereof as if made on the date hereof, treating this Amendment, the
Credit Agreement as amended hereby, and the other Loan Documents as
amended hereby, as "Loan Documents" for the purposes of making said
representations and warranties.
ss.3. Conditions to Effectiveness. The effectiveness of this Amendment
shall be subject to the delivery to the Agent and the Lenders by (or on behalf
of) each of the Borrowers or the Guarantors, as the case may be,
contemporaneously with the execution hereof, of each of the following, each in
form and substance satisfactory to the Agent and the Lenders:
(a) this Amendment signed by each of the Borrowers, the Guarantors, the
Agent, and the Lenders;
(b) the Amended and Restated Fee Letter of even date herewith, signed by
each of the Borrowers, the Guarantors, and the Agent;
(c) an extension fee in the amount of $60,000 to be paid to the Agent
for the pro rata accounts of the Lenders in accordance with each
Lender's Total Percentage (as in effect immediately prior to the
effectiveness of this Amendment);
(d) an increase fee payable to Imperial Bank on the date hereof in the
amount of $20,000;
(e) certificates of an appropriate officer of each of the Borrowers and
the Guarantors, dated as of the date hereof, as to (i) the corporate
actions taken by each of the Borrowers and the Guarantors
authorizing the execution, delivery, and performance hereof, and
(ii) the names, titles, incumbency, and specimen signatures of the
officers of each of the Borrowers and the Guarantors authorized to
sign this Amendment on behalf of each of the Borrowers and the
Guarantors;
(f) a favorable written legal opinion addressed to the Agent and the
Lenders, dated as of the date hereof, from Schulte, Roth & Zabel
LLP, special counsel to the Borrowers and the Guarantors, with
respect to such matters as the Agent or the Lenders may reasonably
request;
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(g) such evidence as the Agent may reasonably request such that the
Agent shall be satisfied that the representations and warranties
contained in ss.2 hereof are true and correct on and as of date
hereof;
(h) an executed Amended and Restated Revolving Credit Note in favor of
each of FNBB and Imperial Bank substantially in the form of Exhibit
A hereto, in the amounts of their respective Commitment Percentages
of the Revolving Credit Commitment Amount, which amended and
restated notes shall be hereafter deemed to constitute the Revolving
Credit Notes referred to in the Credit Agreement; and
(i) such other certificates, documents, or instruments with respect to
this Amendment, the Borrowers, and the Guarantors as the Agent or
the Lenders may reasonably request.
ss.4. Certain Transitional Arrangements. Effective as of the date hereof,
each Lender shall make such dispositions and arrangements with each other Lender
with respect to the then outstanding Revolving Credit Loans (the "Adjustment")
as shall result in the amount of Revolving Credit Loans owed to each Lender
being equal to the product of such Lender's Commitment Percentage multiplied by
the aggregate Revolving Credit Loans outstanding on the date hereof (the
"Adjusted Amount"). The Borrowers and the Guarantors hereby agree that each
Lender's Adjusted Amount shall be Revolving Credit Loans owed by the Borrowers
jointly and severally to such Lender as if such Lender had initially made
Revolving Credit Loans to the Borrowers in the amount of the Adjusted Amount.
The Borrowers hereby also jointly and severally agree to pay all amounts
referred to in ss.4.12 of the Credit Agreement arising in connection with the
Adjustment (as if the Adjustment resulted in prepayments of the Revolving Credit
Loans reallocated pursuant to the Adjustment). Upon the occurrence of the
Adjustment, (a) the Agent shall appropriately adjust its records to reflect each
Lender's Adjusted Amount and (b) each Lender shall promptly thereafter return to
the Agent its Revolving Credit Note so replaced by an Amended and Restated
Revolving Credit Note executed in connection with this Amendment.
ss.5. No Other Amendments or Waivers; Execution in Counterparts. Except
as otherwise expressly provided by this Amendment, all of the terms, conditions
and provisions of the Credit Agreement and the other Loan Documents shall remain
in full force and effect. Each of the Borrowers and the Guarantors confirms and
agrees that the Obligations of the Borrowers to the Lenders under the Loan
Documents, as amended and supplemented hereby, are secured by, guarantied under,
and entitled to the benefits, of the Security Documents. The Borrowers, the
Guarantors, the Agent and the Lenders hereby acknowledge and agree that all
references to the Credit Agreement and the Obligations thereunder contained in
any of the Loan Documents shall be references to the Credit Agreement and the
Obligations, as amended hereby and as the same may be amended, modified,
supplemented, or restated from time to time. The Security Documents and the
perfected first priority security interests of the Lenders thereunder as
collateral security for the Obligations shall continue in full force and effect,
and the collateral security and guaranties provided for in the Security
Documents shall not be impaired by this Amendment. This Amendment may be
executed in any number of counterparts, but all such counterparts shall together
constitute but one instrument. In making proof of this Amendment it shall not be
necessary to produce or account for more than one counterpart signed by each
party hereto by and against which enforcement hereof is sought.
ss.6. Governing Law. This Amendment shall be construed according to and
governed by the internal laws of the Commonwealth of Massachusetts without
reference to principles of conflicts of law.
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
executed by their respective officers thereunto duly authorized
The Borrowers:
MORTON'S RESTAURANT GROUP, INC.
PEASANT HOLDING CORP.
MORTON'S OF CHICAGO, INC.
By: /s/ Thomas J. Baldwin
-------------------------------------
Name: Thomas J. Baldwin
Title: Executive Vice President and Chief
Financial Officer
BANKBOSTON, N.A. (formerly known as The
First National Bank of Boston) for itself
and as Agent
By: /s/ Rod Guinn
-------------------------------------
Name: Rod Guinn
Title: Director
IMPERIAL BANK
By:
-------------------------------------
Name:
----------------------------------
Title:
----------------------------------
HELLER FINANCIAL, INC.
By:
-------------------------------------
Name:
----------------------------------
Title:
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Consented and agreed to, by each of
THE GUARANTORS (as defined in the Credit
Agreement)
By: /s/ Thomas J. Baldwin
-------------------------------------
Name: Thomas J. Baldwin
Title: Executive Vice President and Chief
Financial Officer for each of the
Guarantors
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
executed by their respective officers thereunto duly authorized
The Borrowers:
MORTON'S RESTAURANT GROUP, INC.
PEASANT HOLDING CORP.
MORTON'S OF CHICAGO, INC.
By:
-------------------------------------
Name: Thomas J. Baldwin
Title: Executive Vice President and Chief
Financial Officer
BANKBOSTON, N.A. (formerly known as The
First National Bank of Boston) for itself
and as Agent
By:
-------------------------------------
Name: Rod Guinn
Title: Director
IMPERIAL BANK
By: /s/ Dianne H. Russell
-------------------------------------
Name: Dianne H. Russell
Title: Senior Vice President
HELLER FINANCIAL, INC.
By:
-------------------------------------
Name:
----------------------------------
Title:
----------------------------------
Consented and agreed to, by each of
THE GUARANTORS (as defined in the Credit
Agreement)
By:
-------------------------------------
Name: Thomas J. Baldwin
Title: Executive Vice President and Chief
Financial Officer for each of the
Guarantors
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
executed by their respective officers thereunto duly authorized
The Borrowers:
MORTON'S RESTAURANT GROUP, INC.
PEASANT HOLDING CORP.
MORTON'S OF CHICAGO, INC.
By:
-------------------------------------
Name: Thomas J. Baldwin
Title: Executive Vice President and Chief
Financial Officer
BANKBOSTON, N.A. (formerly known as The
First National Bank of Boston) for itself
and as Agent
By:
-------------------------------------
Name: Rod Guinn
Title: Director
IMPERIAL BANK
By:
-------------------------------------
Name:
----------------------------------
Title:
----------------------------------
HELLER FINANCIAL, INC.
By: /s/ Bruce Westwood-Booth
-------------------------------------
Name: Bruce Westwood-Booth
----------------------------------
Title: Senior Vice President
----------------------------------
Consented and agreed to, by each of
THE GUARANTORS (as defined in the Credit
Agreement)
By:
-------------------------------------
Name: Thomas J. Baldwin
Title: Executive Vice President and Chief
Financial Officer for each of the
Guarantors