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SECOND AMENDMENT AND WAIVER
TO AMENDED AND RESTATED REVOLVING CREDIT AGREEMENT
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Second Amendment and Waiver to Amended and Restated Revolving Credit
Agreement dated as of October 14, 1998 (the "Second Amendment") by and among AU
BON PAIN CO., INC., a Delaware corporation ("ABP"), SAINT LOUIS BREAD COMPANY,
INC., a Delaware corporation ("Saint Louis Bread"), ABP MIDWEST MANUFACTURING
CO., INC., a Delaware corporation ("ABP Midwest", and, collectively with ABP and
Saint Louis Bread, the "Borrowers"), and BANKBOSTON, N.A., a national banking
association, and USTRUST, a Massachusetts trust company (collectively, the
"Banks"), and BANKBOSTON, N.A. as agent for the Banks (in such capacity, the
"Agent"), amending certain provisions of the Amended and Restated Revolving
Credit Agreement dated as of February 13, 1998 (as amended by the First
Amendment to Amended and Restated Revolving Credit Agreement dated as of June
30, 1998 and as further amended and in effect from time to time, the "Credit
Agreement") by and among the Borrowers, the Banks and the Agent. Terms not
otherwise defined herein which are defined in the Credit Agreement shall have
the same respective meanings herein as therein.
WHEREAS, the Borrowers, the Banks and the Agent have agreed to modify
certain terms and conditions of the Credit Agreement as specifically set forth
in this Second Amendment;
NOW, THEREFORE, in consideration of the premises and the mutual
agreements contained herein and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto
hereby agree as follows:
s.1. Amendments to s.1 of the Credit Agreement. Section 1 of the
Credit Agreement is hereby amended as follows:
(a) by deleting the definition of "Applicable Margin" in its entirety
and hereby replacing it with the following definition:
Applicable Margin. The Applicable Margin for Base Rate Loans shall be
the percentage 0.25%. The Applicable Margin for Eurodollar Loans shall be the
percentage 2.75%.
s.2. Amendments to s.7 of the Credit Agreement Section 7 of the Credit
Agreement is hereby amended as follows:
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(a) Section 7.6 of the Credit Agreement is hereby amended by deleting
the text of clause (i) after "provided that" and before "(ii)" and replacing it
with the following:
(i) any such Subsidiary (other than a Subsidiary which is a Borrower)
may merge into, or convey, sell, lease or dispose of their assets to,
any of the Borrowers or any wholly-owned Subsidiaries of the Borrowers,
s.3. Amendments to s.8 of the Credit Agreement Section 8 of the
Credit Agreement is hereby amended as follows:
(a) Section 8.3 of the Credit Agreement is hereby amended by deleting
the words after "(b)" and replacing them with the following:
1.60 to 1.00 for the four quarter period ending July 11, 1998; (c) 1.40
to 1.00 for each of the four quarter periods ending October 3, 1998 and
December 26, 1998 and (d) 1.60 to 1.00 for any such four quarter period
ending after December 26, 1998.
(b) Section 8.4 of the Credit Agreement is hereby amended by deleting
such section in its entirety and replacing it with the following new Section
8.4:
s.8.4. Profitable Operations. The Borrowers will not permit (a)
Consolidated Net Income to be less than $1.00 for any period consisting
of two consecutive fiscal quarters of the Borrowers ending prior to or
after October 3, 1998, (b) Consolidated Net Deficit to be more than
$700,000.00 for the period consisting of the single fiscal quarter
ending October 3, 1998 and (c) Consolidated Net Income to be less than
$1,500,000.00 for the period consisting of the single fiscal quarter
ending December 26, 1998.
s.4. Waiver. The Borrowers have informed the Banks that as of the
Borrowers' fiscal quarter ending July 11, 1998, the Borrowers are not in
compliance with the covenant set forth in s.8.4 of the Credit Agreement
resulting in an Event of Default under s.11(c) of the Credit Agreement (the
"Existing Default"). The Borrowers hereby request that the Banks waive the
Existing Default. In response to the Borrowers' request, the Banks hereby waive
the Existing Default, provided, that the waiver contained herein shall operate
solely with respect to the Existing Default as herein described and shall not
impair any right or power accruing to the Banks with respect to any other
Default or Event of Default which may now exist or any Default or Event of
Default which may occur after the date hereof including without limitation any
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Event of Default with respect to subsequent losses in violation of s.8.4 of the
Credit Agreement.
s.5. Representations and Warranties. Each of the Borrowers hereby
repeats, on and as of the date hereof, each of the representations and
warranties made in ss.5 of the Credit Agreement as though such representations
and warranties refer specifically to such Borrower, except to the extent of
changes resulting from transactions contemplated or permitted by this Second
Amendment or the Credit Agreement and except to the extent that such
representations and warranties relate expressly to an earlier date; provided,
that all references therein to the Credit Agreement shall refer to such Credit
Agreement as amended hereby. No Default or Event of Default has occurred and is
continuing under the Credit Agreement after giving effect to this Second
Amendment.
s.6. Effectiveness. The effectiveness of this Second Amendment shall
be subject to the satisfaction of the following conditions precedent:
s.6.1. Loan Documents. This Second Amendment shall have been
duly executed and delivered to the Agent by each of the parties to the
Credit Agreement.
s.6.2. No Default. No Default or Event of Default has
occurred and is continuing under the Credit Agreement immediately after
giving effect to this Second Amendment.
s.6.3. Waiver Fee. The Borrowers shall have paid to the
Agent, for the pro rata accounts of the Banks, a waiver fee of $50,000.
s.7. Ratification, Etc. Except as expressly amended hereby, the Credit
Agreement and all documents, instruments and agreements related thereto,
including, but not limited to the Loan Documents, are hereby ratified and
confirmed in all respects and shall continue in full force and effect. The
Credit Agreement and this Second Amendment shall be read and construed as a
single agreement. All references in the Credit Agreement or any related
agreement or instrument to the Credit Agreement shall hereafter refer to the
Credit Agreement as amended hereby.
s.8. No Waiver. Except as expressly provided in s.4, nothing
contained herein shall constitute a waiver of, impair or otherwise affect any
Obligations, any other obligation of the Borrowers or any rights of the Agent or
the Banks consequent thereon.
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s.9. Counterparts. This Second Amendment may be executed in one or
more counterparts, each of which shall be deemed an original but which together
shall constitute one and the same instrument.
s.10. Governing Law. THIS SECOND AMENDMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE COMMONWEALTH OF MASSACHUSETTS
(WITHOUT REFERENCE TO CONFLICT OF LAWS).
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IN WITNESS WHEREOF, the parties hereto have executed this Second
Amendment as a document under seal as of the date first above written.
AU BON PAIN CO., INC.
By: /s/ ANTHONY J. CARROLL
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Name: Anthony J. Carroll
Title: Chief Financial Officer
SAINT LOUIS BREAD COMPANY, INC.
By: /s/ ANTHONY J. CARROLL
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Name: Anthony J. Carroll
Title: Chief Financial Officer
ABP MIDWEST MANUFACTURING CO., INC.
By: /s/ ANTHONY J. CARROLL
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Name: Anthony J. Carroll
Title: Chief Financial Officer
BANKBOSTON, N.A.
individually and as Agent
By: /s/ BARBARA D. SEARLE
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Name: Barbara D. Searle
Title: Vice President
USTRUST
By: /s/ P. JEFFREY HUTH
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Name: P. Jeffrey Huth
Title: Vice President