EXHIBIT 4.7
FOURTH AMENDMENT TO LETTER AGREEMENT
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THIS FOURTH AMENDMENT TO LETTER AGREEMENT (this "Fourth Amendment") is
made and dated as of November 1, 1996 among INTERNATIONAL HOUSE OF PANCAKES,
INC. (the "Borrower"), IHOP CORP., as Guarantor (the "Guarantor"), and BANK OF
AMERICA ILLINOIS ("Bank"), and amends that certain Letter Agreement dated as of
June 30, 1993, as amended by a letter dated July 15, 1993 from Continental Bank
to the Borrower, a First Amendment to Letter Agreement dated as of December 31,
1994, a Second Amendment to Letter Agreement dated as of March 11, 1996, and a
Third Amendment to Letter Agreement dated as of September 3, 1996 (as so
amended, the "Agreement").
RECITAL
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The Borrower has requested that the Bank enter into the Intercreditor
Agreement in the form attached hereto, amend certain financial covenants and
waive certain Event of Defaults under the Agreement, and the Bank is willing to
do so on the terms and conditions set forth herein.
NOW, THEREFORE, for good and valuable consideration, the receipt and
adequacy of which are hereby acknowledged, the parties hereby agree as follows:
1. Terms. All capitalized terms used herein shall have the same
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meanings as in the Agreement unless otherwise defined herein. All references to
the Agreement shall mean the Agreement as hereby amended.
2. Amendments to Agreement. The parties hereto agree that the
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Agreement is hereby amended as follows:
2.1 Section 14.1(i) of the Agreement is amended and restated in
its entirety as follows:
"(i) Liens including Liens arising out of purchase money
financing not otherwise permitted by the foregoing clauses of this Section 14.1
securing Debt (without duplication) of IHOP, the Borrower or any Subsidiary of
IHOP or the Borrower, provided that the sum
of (i) the principal amount of such Debt plus (ii) unsecured Debt (other than
Additional Permitted Subsidiary Guarantees) of Subsidiaries of IHOP (other than
the Borrower) and Subsidiaries of the Borrower not otherwise permitted under
Section 14.4(a) does not exceed at any time 15% of Consolidated Tangible Net
Worth."
2.2 Section 14.4(B) of the Agreement is amended and restated in
its entirety as follows:
"(B) Additional Debt (other than Additional Permitted
Subsidiary Guarantees), provided that the sum of the aggregate principal amount
of such Debt plus the aggregate principal amount of all other Debt (without
duplication) of IHOP, the Borrower and any of their Subsidiaries which is
secured by Permitted Liens permitted by Section 14.1(i) does not exceed 15% of
Consolidated Tangible Net Worth."
2.3 Section 18 of the Agreement is amended to include the
following definitions:
"Additional Permitted Subsidiary Guarantees" shall mean
those Guarantees delivered by any Subsidiary Guarantor which guarantees Debt of
the Borrower the beneficiaries of which are or become a party to, and thereby
agree to undertake and perform the duties, rights and obligations of a party
under, the Intercreditor Agreement.
"Intercreditor Agreement" means the Intercreditor Agreement
dated as of November 1, 1996 among the 1992 Noteholders (as defined therein),
the 1996 Noteholders (as defined therein), the Bank and additional creditors
which may become a party thereto from time to time, substantially in the form
attached hereto as Exhibit I.
"Subsidiary Guarantors" shall mean collectively IHOP Realty,
IHOP Properties, Inc. and IHOP Restaurants, Inc.
2.4 The Agreement is amended to include the Intercreditor
Agreement as Exhibit I.
3. Reaffirmation of IHOP Guaranty. IHOP does hereby reaffirm that
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the terms and provisions of Section
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17 of the Agreement continue in full force and effect and are ratified and
confirmed in all respects on and as of the date hereof, after giving effect to
this Fourth Amendment. IHOP agrees that any references to the Note in the
Agreement, including without limitation Section 17 of the Agreement, shall be
deemed a reference to the Agreement and amounts owing thereunder, as evidenced
by the loan accounts referred to in Section 3 of the Agreement, as amended
hereby.
4. Execution of Intercreditor Agreement. The Bank hereby agrees to
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duly authorize, execute, deliver and perform its obligations under the
Intercreditor Agreement.
5. Representations and Warranties. IHOP and the Borrower do hereby
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represent and warrant as follows:
5.1 Authority. Each of the Borrower and IHOP has been duly
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incorporated and is a validly existing corporation under the laws of the State
of Delaware, has full legal right, power and authority to enter into this Fourth
Amendment and to carry out and consummate all transactions contemplated by the
Agreement and this Fourth Amendment.
5.2 Enforceability. This Fourth Amendment has been duly
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authorized and is a valid and binding obligation of the Borrower and IHOP,
enforceable in accordance with its terms.
5.3 No Conflict. This Fourth Amendment will not conflict with
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or constitute a breach of or a default under their respective articles of
incorporation or by-laws, or any material agreement to which the Borrower or
IHOP is a party or by which the Borrower or IHOP or any of their respective
properties are bound, or any rule or regulation of any court or governmental
agency or body having jurisdiction over the Borrower or IHOP or any of their
respective activities or properties.
5.4 No Event of Default. Except for the Event of Defaults
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waived pursuant to Section 7 hereof, no Event of Default under the Agreement has
occurred and is continuing.
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5.5 Representations and Warranties. The representations and
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warranties in Section 11 of the Agreement are true and correct in all respects
on and as of the date hereof as though made on and as of the date hereof.
6. Conditions, Effectiveness. The effectiveness of this Fourth
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Amendment shall be subject to the compliance by the Borrower with its agreements
herein contained and the execution and delivery of the Intercreditor Agreement
by the parties thereto.
7. Upon and by virtue of this Fourth Amendment becoming effective
as herein contemplated, the Event of Default under Section 16(c) and the Event
of Default under Section 16(f) caused by a default under Sections 11.1(I) and
11.4(B) of the 1992 Note Agreements (as defined in the Intercreditor Agreement)
shall be deemed to have been waived by the Bank.
8. Miscellaneous
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(a) Except as hereby expressly amended, the Agreement shall remain in
full force and effect and is hereby ratified and confirmed in all respects.
(b) This Fourth Amendment is specific in time and in intent and does
not constitute, nor shall it be construed as, a waiver of any other right, power
or privilege under the Agreement, or under any agreement, contract, indenture,
document or instrument mentioned in the Agreement; nor does it preclude other or
further exercise hereof or the exercise of any other right, power or privilege,
nor shall any waiver of any right, power, privilege or default hereunder, or
under any agreement, contract, indenture, document or instrument mentioned in
the Agreement, constitute a waiver of any other default of the same or of any
other term or provision.
(c) This amendment may be executed in any number of counterparts and
all of such counterparts taken together shall be deemed to constitute one and
the same instrument. This amendment shall not become effective until the
Borrower, IHOP, IHOP Realty, IHOP Properties, Inc. and IHOP Restaurants, Inc.
shall each have signed a copy hereof, whether the same or counterparts, and the
same shall have been delivered to Bank and the Bank shall
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have signed a copy hereof, whether the same or counterpart, and the same shall
have been delivered to the Borrower.
9. Governing Law. This Fourth Amendment shall be a contract made
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under and governed by the internal laws of the state of Illinois.
IN WITNESS WHEREOF, each of the parties hereto has caused its
respective duly authorized officer to execute and deliver this Fourth Amendment
as of the date first written above.
INTERNATIONAL HOUSE OF PANCAKES, INC.
By: /s/ Xxxxxxx X. Xxxxxx
_____________________
Xxxxxxx X. Xxxxxx
President and
Chief Executive Officer
IHOP CORP.
By: /s/ Xxxxxxx X. Xxxxxx
_____________________
Xxxxxxx X. Xxxxxx
President and
Chief Executive Officer
BANK OF AMERICA ILLINOIS
By: /s/ Xxxx X. Xxxx
________________
Xxxx X. Xxxx
Vice President
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CONSENT OF GUARANTOR
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The undersigned Guarantor does hereby consent to the foregoing Fourth
Amendment to Letter Agreement dated as of November 1, 1996 and hereby reaffirms,
ratifies and confirms that its Subsidiary Guarantee continues in full force and
effect on and as of the date hereof and after giving effect to such Fourth
Amendment. The undersigned agrees that any references to the Note in the
Guarantee and the Agreement shall be deemed a reference to the Agreement and
amounts owing thereunder, as evidenced by the loan accounts referred to in
Section 3 of the Agreement.
Dated: November 8, 1996
IHOP REALTY CORP.
By: /s/ Xxxxxxx X. Xxxxxx
_____________________
Xxxxxxx X. Xxxxxx
President and
Chief Executive Officer
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CONSENT OF GUARANTOR
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The undersigned Guarantor does hereby consent to the foregoing Fourth
Amendment to Letter Agreement dated as of November 1, 1996 and hereby reaffirms,
ratifies and confirms that its Subsidiary Guarantee continues in full force and
effect on and as of the date hereof and after giving effect to such Fourth
Amendment. The undersigned agrees that any references to the Note in the
Guarantee and the Agreement shall be deemed a reference to the Agreement and
amounts owing thereunder, as evidenced by the loan accounts referred to in
Section 3 of the Agreement.
Dated: November 8, 1996
IHOP PROPERTIES, INC.
By: /s/ Xxxxxxx X. Xxxxxx
_____________________
Xxxxxxx X. Xxxxxx
President and
Chief Executive Officer
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