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EXHIBIT 10.35
AMENDMENT NO. 2
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TO
THIRD AMENDED AND RESTATED CREDIT AGREEMENT
AND
LIMITED WAIVER
This AMENDMENT NO. 2 TO THIRD AMENDED AND RESTATED CREDIT AGREEMENT AND
LIMITED WAIVER (this "Amendment") is entered into as of September 28, 2000,
among CKE Restaurants, Inc., the Lenders and BNP Paribas, a bank organized under
the laws of France acting through its Chicago branch (as successor in interest
to Paribas), as Agent.
RECITALS
CKE Restaurants, Inc., a Delaware corporation (the "Borrower"), certain
financial institutions (the "Lenders") and Paribas, as agent for the Lenders (in
such capacity, the "Agent") are parties to that certain Third Amended and
Restated Credit Agreement, dated as of November 24, 1999, as amended by that
certain Amendment No.1 to Third Amended and Restated Credit Agreement, dated as
of April 26, 2000 (as heretofore amended or otherwise modified, the "Credit
Agreement").
The Borrower has requested that the Agent and the Lenders amend and
grant waivers with respect to certain provisions of the Credit Agreement, all as
more fully described herein.
The Agent and the Lenders have agreed to grant such amendments and
waivers upon the terms and conditions set forth herein.
AGREEMENT
NOW, THEREFORE, in consideration of the foregoing and for other good
and valuable consideration, the receipt and adequacy of which are hereby
acknowledged, the parties hereto hereby agree as follows:
Section 1. Definitions. Capitalized terms used herein and not otherwise defined
herein shall have the respective meanings assigned thereto in the Credit
Agreement, as amended hereby.
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Section 2. Amendments to the Credit Agreement. Subject to the terms and
conditions set forth herein, the Credit Agreement is hereby amended as follows:
(a) Section 1.1 of the Credit Agreement is hereby amended by:
(1) deleting, in its entirety, each reference to "$125
million" contained in subsection (c) of the definition of
"Applicable Margin" appearing in such Section and replacing
each such reference with a reference to "$150 million,"
(2) deleting, in their entirety, the definitions of "50%
Mandatory Prepayment," "Paydown Amount," "Paydown Condition"
and "Reduction Amount" appearing in such Section, and
(3) adding the following new definitions to such Section in
proper alphabetical order:
"Financial Advisor" has the meaning set forth in
Section 10.11.
"Retail Period" means any of the thirteen consecutive
four week or five week periods used by the Borrower
for accounting purposes which begin on or about the
Tuesday after the last Monday in January of each year
and ending on the last Monday in January of the next
year.
(b) Section 2.12 of the Credit Agreement is hereby amended by (1)
amending and restating, in its entirety, subsection (a) thereof to read as
follows:
(a) Within ten (10) days of each date that any Loan
Party receives any Liquidating Distribution and, subject to
the provisos to Section 2.12(b), within ten (10) days of each
date that the Borrower or any of its Subsidiaries receives any
Net Sale Proceeds from consummation of any Asset Disposition
(excluding any Sale and Leaseback Transaction of the Borrower
or any of its Subsidiaries permitted pursuant to Section
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7.13(a)), the Borrower shall prepay the outstanding Loans in
an amount equal to 100% of the amount of such Liquidating
Distribution or Net Sale Proceeds, as the case may be, in
accordance with the provisions of Section 2.13.
and (2) amending and restating, in its entirety, subsection (b) thereof to read
as follows:
(b) Within ten (10) days of each date that the
Borrower or any of its Subsidiaries receives any Net Sale
Proceeds from the consummation of any Asset Disposition that
constitutes the sale portion of a Sale and Leaseback
Transaction permitted pursuant to Section 7.13(a)
("Sale-Leaseback Proceeds"), which when combined with the
Sale-Leaseback Proceeds from all such Asset Dispositions
occurring after the date hereof exceeds $25,000,000, the
Borrower shall prepay the outstanding Loans in an amount equal
to 100% of the amount of such Sale-Leaseback Proceeds in
accordance with the provisions of Section 2.13; provided,
however, that (i) if the Borrower has chosen to apply any part
of the first $25,000,000 of Sale-Leaseback Proceeds to
permanently prepay the outstanding Loans and concurrently
reduce the Revolving Commitments, then the Borrower or the
applicable Subsidiary may, subject to clause (ii) of this
provisio, retain a dollar for dollar amount of the next Net
Sale Proceeds (including Sale-Leaseback Proceeds) received
from any Asset Disposition up to $25,000,000 and (ii) any Net
Sale Proceeds retained by the Borrower or any Subsidiary
(whether constituting all or a portion of the first
$25,000,000 of Sale-Leaseback Proceeds or all or a portion of
the amounts referred to in clause (i) of this proviso) that
are not used within three hundred sixty (360) days after
receipt thereof by the Borrower or such Subsidiary to reinvest
in its respective business in non-current assets as permitted
by the terms of this Agreement shall be used to prepay the
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outstanding Loans in accordance with Section 2.13; provided,
further, that if an Event of Default shall have occurred and
be continuing on the date any Net Sale Proceeds referred to in
this Section 2.12(b) are received by the Borrower or any of
its Subsidiaries (or, in the case of the foregoing clause
(ii), at any time during such three hundred sixty day period),
then the Borrower shall prepay the outstanding Loans in an
amount equal to 100% of such Net Sale Proceeds (or, if any
portion of such proceeds shall have been reinvested prior to
the occurrence of such Event of Default, 100% of such
remaining amount of Net Sale Proceeds not so reinvested) on
the later of the date such Net Sale Proceeds are received by
the Borrower or any of its Subsidiaries or the date of the
occurrence of such Event of Default in accordance with the
provisions of Section 2.13.
and (3) deleting, in its entirety, each reference to "this Section 2.12(b)"
contained in subsection (c) thereof and replacing each such reference with a
reference to "this Section 2.12(c)."
(c) Section 2.13 of the Credit Agreement is hereby amended by deleting,
in its entirety, each reference to "Section 2.12(a)(ii)(B)" contained in
subsections (a) and (b) thereof and replacing each such reference with a
reference to "Section 2.12."
(d) Section 6.1 of the Credit Agreement is hereby amended by (1)
renumbering subsection (l) thereof to be subsection (m) and (2) adding a new
subsection (l) to read as follows:
(l) Officer's Certificates and Income Statements relating to
Retail Periods. Within 30 days after the close of each Retail
Period of the Borrower, a certificate of the chief financial
officer of the Borrower which certifies that such officer has
reviewed the terms of the Loan Documents and has made, or
caused to be made under his or her supervision, a review in
reasonable detail of the business and condition of the Bor-
rower and its Subsidiaries during such Retail Period,
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and that as a result of such review such officer has concluded
that no Default or Event of Default has occurred during the
period commencing at the beginning of such Retail Period and
ending on the date of such certificate or, if any Default or
Event of Default has occurred, specifying the nature and
extent thereof and, if continuing, the action the Borrower
proposes to take in respect thereof. Such certificate shall
set forth the calculations required to establish whether the
Borrower was in compliance with the provisions of Section
7.1(d) during and as at the end of such Retail Period
(including, without limitation, calculations of Consolidated
EBITDA, consolidated depreciation and consolidated
amortization of the Borrower and its Subsidiaries for such
Retail Period) and shall be accompanied by a consolidated
statement of income for the Borrower and its Subsidiaries for
such Retail Period.
(e) Section 6.2 of the Credit Agreement is hereby amended by amending
and restating, in its entirety, the second sentence of such Section to read as
follows:
The Borrower shall, and shall cause each of its
Subsidiaries to, permit the officers and designated
representatives of any Lender or the Financial Advisor to
visit and inspect any of the properties of the Borrower or
any of its Subsidiaries, and to examine the books of record
and account of the Borrower or any of its Subsidiaries and
discuss the affairs, finances and accounts of the Borrower or
any of its Subsidiaries, with, and be advised as to the same
by, its and their officers and independent accountants, all
upon reasonable notice and at such reasonable times as such
Lender or, in the case of the Financial Advisor, the Agent may
desire; provided that no such prior notice shall be required
if an Event of Default has occurred and is continuing.
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(f) Section 6.13 of the Credit Agreement is hereby amended by amending
and restating, in its entirety, such Section to read as follows:
Section 6.13 Additional Collateral. If the Borrower
and its Subsidiaries have not received an aggregate amount of
Net Sale Proceeds of (a) at least $30,000,000 for Asset
Dispositions (including the sale portion of Sale and Leaseback
Transactions permitted by Section 7.13(a), but only if the
Borrower has used the Net Sale Proceeds therefrom to prepay
outstanding Loans and concurrently reduce the Revolving Loan
Commitments by a corresponding amount) consummated from
September 20, 2000 through November 30, 2000 and (b)
$90,000,000 for Asset Dispositions (including the sale portion
of Sale and Leaseback Transactions permitted by Section
7.13(a), but only if the Borrower has used the Net Sale
Proceeds therefrom to prepay outstanding Loans and
concurrently reduce the Revolving Loan Commitments by a
corresponding amount) consummated from September 20, 2000
through December 20, 2000 and (c) $150,000,000 for Asset
Dispositions (including the sale portion of Sale and Leaseback
Transactions permitted by Section 7.13(a), but only if the
Borrower has used the Net Sale Proceeds therefrom to prepay
outstanding Loans and concurrently reduce the Revolving Loan
Commitments by a corresponding amount) consummated from
September 20, 2000 through January 29, 2001, then, the Agent
may (and shall at the direction of the Required Lenders)
request, and the Borrower shall, and shall cause each of its
Subsidiaries to, promptly use its best efforts to promptly
execute and deliver to the Agent such security agreements,
pledge agreements, mortgages, leasehold mortgages and other
agreements, instruments, documents and opinions as the Agent
shall request, each in form and substance satisfactory to the
Agent, granting to the Agent, for the benefit of the Lenders,
a valid and perfected, first priority secu-
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rity interest in such assets and property of the Bor rower and
such Subsidiaries.
(g) Section 7.1 of the Credit Agreement is hereby amended by (1)
amending and restating, in its entirety, subsection (d) thereof to read as
follows:
(d) Minimum Consolidated EBITDA. The Borrower shall not permit
Adjusted Consolidated EBITDA of the Borrower for the period of
four consecutive fiscal quarters (or, commencing on November
7, 2000, the period of thirteen consecutive Retail Periods) of
the Borrower (taken as one accounting period) as determined on
the last day of each fiscal quarter (or, commencing on
November 7, 2000, the last day of each Retail Period) of the
Borrower ending during each period set forth below, minus the
amount of any EBITDA Adjustments as of the date of
determination, to be less than the amount set forth opposite
such period:
Period Amount
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Second A&R Closing Date through November 1, 1999 $200,000,000
November 2, 1999 through January 31, 2000 $175,000,000
February 1, 2000 through May 22, 2000 $155,000,000
May 23, 2000 through August 14, 2000 $160,000,000
August 15, 2000 through November 6, 2000 and
each Retail Period thereafter $133,000,000
provided, however, that the amount set forth opposite such
period shall be reduced by the EBITDA Adjustments as of the
date of determination attributable to those Restaurants sold
(excluding those sold during the period from November 2, 1999
through January 31, 2000) pursuant to which the Net Sale
Proceeds from
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such sales have been applied to permanently reduce the
Commitments of the Lenders on or before the 45th calendar day
following the end of the fiscal quarter in which such
Restaurants were sold.
and (2) deleting, in its entirety, the reference to "$120,000,000" contained in
the first sentence of subsection (f) thereof and replacing such reference with a
reference to "$90,000,000."
(h) Section 7.5 (a) of the Credit Agreement is hereby amended by
amending and restating, in its entirety, clause (ii) thereof to read as follows:
(ii) the purchase price for such asset shall be paid
to the Borrower or such Subsidiary solely in cash, Cash
Equivalents or non-cash consideration in the form of
promissory notes, provided that, in the case of non-cash
consideration received in the form of promissory notes, (A)
such consideration shall not exceed 10% of the aggregate
purchase price for such asset (or 20% of the aggregate
purchase price for such asset if such asset consists of the
assets or business of one or more Restaurants being operated
under the Hardee's concept), (B) such promissory notes shall
mature no later than 3 years after the date of issuance, (C)
such promissory notes shall be pledged to the Agent, for the
benefit of the Lenders, pursuant to a pledge agreement in form
and substance satisfactory to the Agent, (D) all payments of
principal, interest and other amounts payable under such
promissory notes and that are received by the Borrower or such
Subsidiary shall be applied to prepay the outstanding Loans
in accordance with Section 2.12(a) hereof and (E) the
aggregate principal amount of all promissory notes received as
consideration for all asset sales permitted under this Section
7.5(a) shall not exceed $50,000,000 at any one time
outstanding.
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(i) Section 7.7(b) of the Credit Agreement is hereby amended by
deleting, in its entirety, clause (ii) thereof and renumbering clause (iii)
thereof to be clause (ii).
(j) Section 7.13(a) of the Credit Agreement is hereby amended by
deleting, in their entirety, clauses (1) and (2) of the proviso to such Section
and renumbering clauses (3), (4), (5) and (6) of such proviso to be clauses (1),
(2), (3) and (4), respectively.
(k) Section 10.1 of the Credit Agreement is hereby amended by inserting
the phrase ", the Financial Advisor" immediately after the word "Agent"
appearing in the first line of subsection (c) thereof.
(l) Section 10.11 of the Credit Agreement is hereby amended by amending
and restating, in its entirety, such Section to read as follows:
Section 10.11 Financial Advisor. The Borrower and
each Lender agrees and acknowledges that the Agent may, in its
sole discretion, from time to time retain a financial advisor
(the "Financial Advisor") for the purpose of advising the
Agent and the Lenders as to the financial condition of the
Borrower and its Subsidiaries and such other matters related
to the facility provided and contemplated hereunder as the
Agent and the Lenders may desire. The Borrower agrees to pay
all reasonable fees, costs and out-of-pocket expenses of the
Financial Advisor in connection with the performance of its
duties under this Section 10.11 and to indemnify the Financial
Advisor in accordance with Section 10.1(c) hereof.
Section 3. Limited Waiver. Subject to the terms and conditions set forth herein,
(i) the Agent and the Lenders hereby waive any Default or Event of Default
arising solely as a result of the failure of the Borrower to comply with the
terms of Section 7.1(d) of the Credit Agreement for the period commencing on May
23, 2000 and ending on August 14, 2000 and (ii) for the period commencing on
August 14, 2000 and ending on January 29, 2001, the Agent and the Lenders hereby
waive compliance by the Borrower with the requirements of subsections (a), (b),
(c), (e) and (g) of Section 7.1 of the Credit Agreement; provided, however, that
each of the foregoing
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waivers shall cease to be effective (a) on November 30, 2000 if the Borrower and
its Subsidiaries have not received an aggregate amount of Net Sale Proceeds
(including Net Sale Proceeds received as a result of any Asset Disposition that
constitutes the sale portion of a Sale and Leaseback Transaction permitted
pursuant to Section 7.13(a) of the Credit Agreement but only if the Borrower has
used the Net Sale Proceeds therefrom to prepay outstanding Loans and
concurrently reduce the Revolving Loan Commitments by a corresponding amount) of
at least $30,000,000 during the period from September 20, 2000 to November 30,
2000 and (b) in any event, on January 29, 2001. Upon expiration of the waiver
provided in this Section 3, the Agent and the Lenders shall have the right to
reinstate, as of the date of its first occurrence, any Default or Event of
Default that arose or would have arisen but for such waiver as a result of the
Borrower's failure to comply with the requirements of the Sections of the Credit
Agreement referred to in this Section 3.
Section 4. Representations and Warranties. The Borrower represents and warrants
to the Agent and the Lenders, as of the date hereof, that after giving effect to
this Amendment:
(a) no Default or Event of Default has occurred and is continuing; and
(b) all of the representations and warranties of the Borrower and each
other Loan Party contained in the Transaction Documents are true and correct.
Section 5. Conditions to Effectiveness of this Amendment. Upon satisfaction of
the following conditions precedent, this Amendment shall immediately become
effective as of August 14, 2000:
(a) The Agent shall have received a counterpart to this Amendment, duly
executed and delivered by the Borrower and each of the Required Lenders;
(b) The Agent shall have received a certificate of a duly authorized
officer of the Borrower certifying as to matters set forth in Section 4 of this
Amendment; and
(c) The Agent shall have received a side letter from the Borrower, duly
executed and delivered by the Borrower and relating to the payment of an
amendment fee.
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Section 6. Miscellaneous.
(a) Effect; Ratification. The amendments and waivers set forth herein
are effective solely for the purposes set forth herein and shall be limited
precisely as written, and shall not be deemed to (1) be a consent to any
amendment, waiver or modification of any other term or condition of any
Transaction Document or of any other instrument or agreement referred to
therein, except as set forth herein, or (2) prejudice any right or remedy that
the Agent or any Lender may now have or may have in the future under or in
connection with the Credit Agreement, as amended hereby, or any other instrument
or agreement referred to therein. Each reference in the Credit Agreement to
"this Agreement," "herein," "hereof" and words of like import and each reference
in the other Transaction Documents to the "Credit Agreement" shall mean the
Credit Agreement as amended hereby. For the avoidance of doubt, each reference
in the Credit Agreement, as amended hereby (including each reference contained
in Section 2 of this Amendment) to "the date hereof" shall mean and be a
reference to November 24, 1999. This Amendment shall be construed in connection
with and as part of the Credit Agreement and all terms, conditions,
representations, warranties, covenants and agreements set forth in the Credit
Agreement and each other instrument or agreement referred to therein, except as
herein amended, are hereby ratified and confirmed and shall remain in full force
and effect.
(b) Expenses and Fees. Notwithstanding anything contained in the Credit
Agreement, as amended hereby, or any other Transaction Document and in addition
to any fees and expenses required to be paid by the Borrower thereunder, the
Borrower agrees to pay all costs, fees and expenses incurred by the Agent in
connection with the preparation, execution and delivery of this Amendment
(including the reasonable fees and expenses of counsel to the Agent).
(c) Counterparts. This Amendment may be executed in any number of
counterparts, each such counterpart constituting an original and all of which
when taken together shall constitute one and the same instrument.
(d) Severability. Any provision contained in this Amendment that is
held to be inoperative, unenforceable or invalid in any jurisdiction shall, as
to that jurisdiction, be inoperative, unenforceable or invalid without affecting
the operation, enforceability or validity of the remaining provisions of this
Amendment in that jurisdiction or the operation, enforceability or validity of
such provision in any other jurisdiction.
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(e) GOVERNING LAW. THIS AMENDMENT SHALL BE GOVERNED BY, AND CONSTRUED
AND INTERPRETED IN ACCORDANCE WITH, THE INTERNAL LAWS (AND NOT THE LAW OF
CONFLICTS) OF THE STATE OF ILLINOIS.
[SIGNATURE PAGES FOLLOW]
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IN WITNESS WHEREOF, the undersigned have executed this Amendment as of
the date first above written.
CKE RESTAURANTS, INC.
By:
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Print Name:
Title:
BNP PARIBAS (as successor in interest to
PARIBAS), as Agent and as a Lender
By:
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Print Name:
Title:
By:
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Print Name:
Title:
ARAB BANKING CORPORATION
By:
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Print Name:
Title:
By:
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Print Name:
Title:
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BANK AUSTRIA CREDITANSTALT CORPORATE
FINANCE, INC.
By:
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Print Name:
Title:
By:
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Print Name:
Title:
BANK LEUMI USA
By:
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Print Name:
Title:
BANK UNITED
By:
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Print Name:
Title:
FLEET NATIONAL BANK (f/k/a BANKBOSTON,
N.A.)
By:
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Print Name:
Title:
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CALIFORNIA BANK & TRUST (f/k/a SUMITOMO
BANK OF CALIFORNIA)
By:
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Print Name:
Title:
CENTURA BANK
By:
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Print Name:
Title:
CHANG HWA COMMERCIAL BANK, LTD., NEW
YORK BRANCH
By:
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Print Name:
Title:
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CREDIT INDUSTRIEL ET COMMERCIAL(f/k/a
COMPAGNIE FINANCIERE DE CIC ET DE
L'UNION EUROPEENNE)
By:
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Print Name:
Title:
AMSOUTH BANK (successor in interest by
merger to FIRST AMERICAN NATIONAL BANK)
By:
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Print Name:
Title:
FIRST BANK & TRUST
By:
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Print Name:
Title:
FIRST UNION NATIONAL BANK
By:
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Print Name:
Title:
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MANUFACTURERS BANK
By:
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Print Name:
Title:
NATIONAL BANK OF KUWAIT
By:
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Print Name:
Title:
By:
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Print Name:
Title:
THE SANWA BANK, LIMITED
By:
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Print Name:
Title:
SUNTRUST BANK (f/k/a/ SUNTRUST BANK,
NASHVILLE, N.A.)
By:
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Print Name:
Title:
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UMB BANK, N.A.
By:
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Print Name:
Title:
U.S. BANK NATIONAL ASSOCIATION
By:
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Print Name:
Title:
WELLS FARGO BANK
By:
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Print Name:
Title:
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OFFICER'S CERTIFICATE
I,__________________, am the _________________ of CKE Restaurants, Inc.
I execute and deliver this Officer's Certificate dated as of September ___,
2000, on behalf of the Borrower pursuant to Section 5 of the Amendment No. 2 and
Limited Waiver to Third Amended and Restated Credit Agreement (the "Amendment")
by and among CKE Restaurants, Inc. (the "Borrower"), the Lenders party thereto
and Paribas, acting in its capacity as agent for the Lenders (the "Agent").
Capitalized terms used but not defined herein shall the respective meanings
specified in the Amendment.
I hereby certify, on behalf of the Borrower, after giving effect to the
Amendment, that (a) no Default or Event of Default has occurred and is
continuing and (b) all of the representations and warranties of the Borrower and
each other Loan Party contained in the Transaction Documents are true and
correct as of the date hereof.
CKE RESTAURANTS, INC.
By:
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Name:
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Title:
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