Exhibit 10.90
LINE OF CREDIT AGREEMENT
Dated as of July 21st, ▇▇▇▇
▇▇▇▇▇▇▇
▇&▇ ▇▇ ▇▇▇ ▇▇▇▇▇, ▇.▇.▇.
as Borrower,
THE ▇▇▇▇▇ & WOLLENSKY RESTAURANT GROUP, INC.
and
▇▇▇▇▇ & WOLLENSKY OF BOSTON LLC
as Guarantors
and
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
COMMERCIAL FINANCIAL SERVICES, INC.
as Lender
BASIC LOAN TERMS
Note: See Schedule I below for certain definitions of
terms used in these Basic Loan Terms.
Line of Credit Commitment: $2,000,000 (the "Commitment").
Use of Proceeds: The proceeds of the Advances shall be available
(and the Borrower agrees that it shall use such
proceeds or cause such proceeds to be used) for (i)
the Borrower's working capital purposes, (ii) other
general corporate purposes of the Borrower, or
(iii) closing costs incurred in connection
herewith. No proceeds of any Advance will be used
to purchase or carry any such margin stock or to
extend credit to others for the purpose of
purchasing or carrying any such margin stock.
Repayment: The Borrower shall repay to the Lender on the
Termination Date the aggregate principal amount of
the Advances then outstanding.
Interest: The Borrower shall pay to the Lender interest on
the unpaid principal amount of each Advance from
the date of such Advance until such principal
amount shall be paid in full, at a fluctuating rate
per annum equal to the sum of (i) the LIBO Rate in
effect from time to time plus (ii) 3.0% per annum,
payable in arrears monthly on the last day of each
month and on the date such Advance shall be paid in
full. For purposes hereof, "LIBO Rate" means, for
any day, an interest rate per annum equal to the
interest rate set forth in The Wall Street Journal
(New York City edition) as the one-month London
Interbank Offered Rate (LIBOR) (or an equivalent
rate) for such day (or, if The Wall Street Journal
shall not be published on any Business Day, any
other publication selected in good faith by the
Lender that sets forth the one-month London
Interbank Offered Rate), or, if such interest rate
shall not be so set forth for such day, for the
then most recent day for which such interest rate
is so set forth.
Mandatory and Optional The Borrower may, at any time, prepay all or any
Prepayments: part of the Advances without premium or penalty. If
at any time the aggregate unpaid principal amount
of the Advances exceeds the Commitment, the
Borrower shall immediately prepay Advances in an
amount sufficient to reduce such aggregate unpaid
principal amount to an amount that is not greater
than the Commitment. Such payment shall be applied
by the Lender to repayment of Advances in such
order as the Lender in its sole discretion shall
select. Upon such prepayment by the Borrower, the
Lender shall advise the Borrower of, and the
Borrower shall immediately pay to the Lender, the
amount of accrued and unpaid interest at the
interest rate set forth herein on the amount of
such prepayment of each Advance to the date of such
prepayment.
Payments and Computations: The Borrower hereby irrevocably authorizes ▇▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇ from time to time to pay or prepay to
the Lender on behalf of the Borrower any amount due
and payable hereunder or under the Note, by
application of funds from any Free Credit Balance
existing at such time or from redemption or other
disposition of any MS BusinesScape Funds in the
Borrower's MS BusinesScape Account (and the
Borrower hereby authorizes ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇ from
time to time to redeem or otherwise dispose of such
MS BusinesScape Funds for the purpose of obtaining
funds to make such payment or prepayment). The
Borrower agrees to deposit or otherwise make
available to the Borrower's MS BusinesScape Account
for the account of the Lender on the day when due
and payable, the amount necessary for the purpose
of making payment of any amount due hereunder or
under the Note. To the extent that such Free Credit
Balance and the value of such MS BusinesScape Funds
are insufficient for ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇ to so pay to
the Lender on behalf of the Borrower any such
amount due hereunder, the Lender may, in its sole
discretion, make an Advance pursuant to (and to the
extent permitted under) Section 2.02(a)(iii) in
such amount.
The Borrower shall make each payment hereunder or
under the Note in respect of interest on, principal
of, or other amount related to the Advances, not
later than 12:00 noon (New York City time) on the
day when due and payable in United States Dollars
in same day funds, with payments being so received
by the Lender after such time being deemed to have
been made on the next succeeding Business Day.
All computations of interest hereunder or under the
Note shall be made by the Lender on the basis of a
year of 365 or 366 days, as the case may be, in
each case for the actual number of days (including
the first day but excluding the last day) occurring
in the period for which such interest is payable.
Each determination by the Lender of an interest
rate hereunder or under the Note shall be
conclusive and binding for all purposes, absent
manifest error. Whenever any payment hereunder or
under the Note shall be stated to be due on a day
other than a Business Day, such payment shall be
made on the next succeeding Business Day, and such
extension of time shall in such case be included in
the computation of payment of interest.
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Late Charge: If the Borrower fails to make any payment within 15
days after any such payment shall become due, the
Borrower shall pay to the Lender a late charge
equal to 5% of the amount of any such overdue
payment.
Default Rate: Upon the occurrence and during the continuance of
an Event of Default, the interest on the unpaid
principal amount of all Advances shall be
increased, at the option of the Lender, to a rate
equal to the lesser of two (2%) percent per annum
above the rate of interest provided herein or the
Maximum Rate.
Facility Fee: The Borrower has or will pay to the Lender, on or
before the date hereof, a facility fee in the
amount of $10,000.00.
Unused Availability Fee: The Borrower will pay to the Lender an unused
availability fee equal to 1.75% per annum on the
daily unused portion of the Commitment, which fee
shall be payable quarterly in arrears.
Notices, Etc.: All notices and other communications provided for
hereunder shall be in writing (including fax
communication and any other method of communication
authorized by the Lender) and mailed, faxed, or
otherwise sent or delivered, if to the Borrower or
the Guarantors, at its address at c/o The ▇▇▇▇▇ &
Wollensky Restaurant Group, Inc., ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, or fax number
(▇▇▇) ▇▇▇-▇▇▇▇, Attention: ▇▇▇▇ ▇. ▇▇▇▇▇▇, CFO; if
to the Lender, at its address at ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇ fax number (914)
225-6501, Attention: Director of Credit; or, as to
the Borrower, the Guarantors or the Lender at such
other address or fax number as shall be designated
by such party in a written notice to the other
party. All such notices and communications shall,
when mailed, faxed, or otherwise sent or delivered,
be effective when deposited in the mails, faxed, or
otherwise sent or delivered, respectively, except
that notices and communications to the Lender
pursuant to Article II shall not be effective until
received by the Lender. Delivery by fax of an
executed counterpart of any amendment or waiver of
any provision of this Agreement or of any schedule
or exhibit hereto to be executed and delivered
hereunder shall be effective as delivery of an
original executed counterpart thereof.
The foregoing Basic Loan Terms are incorporated into and made a part of this
Line of Credit Agreement.
iii
LINE OF CREDIT AGREEMENT
LINE OF CREDIT AGREEMENT, dated as of July 21st, 2004 between S&W OF LAS
VEGAS, L.L.C., a Delaware limited liability company (the "Borrower"), THE ▇▇▇▇▇
& WOLLENSKY RESTAURANT GROUP, INC., a Delaware corporation (the "Corporate
Guarantor"), ▇▇▇▇▇ & WOLLENSKY OF BOSTON LLC, a Delaware limited liability
company, ("S&W Boston" and together with the Corporate Guarantor, the
"Guarantors") and ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ COMMERCIAL FINANCIAL SERVICES,
INC., a Delaware corporation (the "Lender").
PRELIMINARY STATEMENTS:
(1) The Borrower and the Guarantors have requested that the Lender
extend to the Borrower a commercial line of credit.
(2) The Lender has agreed to extend to the Borrower a commercial line
of credit on the terms and conditions hereinafter set forth.
NOW, THEREFORE, based on the foregoing premises and in consideration of
the mutual covenants and agreements contained herein, the parties hereto hereby
agree as follows:
ARTICLE I
DEFINITIONS, BASIC LOAN AND ACCOUNTING TERMS
Section 1.01 Certain Defined Terms. In addition to the terms defined
elsewhere in this Agreement, the terms used herein shall have the meanings given
thereto in Schedule I annexed hereto and incorporated by reference herein.
Section 1.02 Basic Loan Terms, Schedules and Exhibits. The Basic Loan
Terms and all exhibits and schedules referred to herein are incorporated herein
by reference as though set forth herein in full.
Section 1.03 Accounting Terms. All accounting terms not specifically
defined herein shall be construed in accordance with GAAP, consistent with those
applied in the preparation of the financial statements referred to in Paragraph
(a) of Schedule II.
ARTICLE II
THE ADVANCES
Section 2.01 The Advances. The Lender agrees, on the terms and
conditions hereinafter set forth, to make advances ("Advances") to the Borrower
from time to time on any Business Day during the period from the Effective Date
hereof until the Termination Date in an aggregate amount outstanding not to
exceed at any time the Commitment. Within the limits of the Commitment, the
Borrower may borrow, repay and reborrow under this Section 2.01(a).
Section 2.02 Making the Advances.
(a) An Advance under this Agreement may be made by the Lender to
the Borrower in any of the ways set forth in clauses (i), (ii) and (iii) below:
(i) The Borrower shall be deemed to have requested the
Lender to make an Advance hereunder on the date of, and in the amount of, each
Uncovered Debit resulting from each use of any Card or any Check, whether or not
such use by any person is authorized by the Borrower. The Borrower will not be
liable hereunder (x) for more than $50.00 of principal (plus interest on such
principal) in respect of any Advance made as a result of any unauthorized use of
any Card by any person other than a person authorized by the Borrower as a
Cardholder (including, without limitation, as such authorized person any person
to whom such Cardholder has permitted to use such Card) and (y) for any amount
in respect of any Advance made as a result of any unauthorized use of any Card
after the Lender or ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇ shall have been notified of a loss, theft
or unauthorized use of such Card (and, for purposes of this Agreement, no
Advance referred to in clause (x) shall be outstanding in a principal amount
more than $50.00, and no Advance referred to in clause (y) shall be outstanding
in any amount). The Lender shall make available to the Borrower, by means of a
credit to the Borrower's MS BusinesScape Account in United States Dollars and in
same day funds, the amount of such Advance. The Borrower hereby authorizes
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇ to apply the proceeds of such Advance to pay itself in
reimbursement for the amount paid by it to Bank One Indiana or Bank One Ohio
relating to such use of such Card or such Check.
(ii) The Borrower may request the Lender, and the Lender
or its Affiliates may make, at the sole and absolute discretion of the Lender,
an Advance by wire transfer (or other means agreed to by the Lender) hereunder
on written notice, given not later than 11:00 a.m. (New York City time) one (1)
Business Day prior to the date of the proposed Advance, by the Borrower to the
Lender. Each such notice of an Advance shall be by telephone, confirmed
immediately in writing, or fax or other method then authorized by the Lender,
and shall specify therein the requested (x) date of such Advance, (y) amount of
such Advance and (z) the deposit account to which the wire transfer of such
Advance is to be sent. To the extent of any unused availability under the Other
Line of Credit Agreement, any request for an Advance by the Borrower under this
Agreement shall be deemed to be a request for an "Advance" under and as defined
in the Other Line of Credit Agreement. If the Lender consents to make a wire
transfer, the Lender or its Affiliates shall, on such date, (A) make available
to the Borrower, by means of a credit to the Borrower's MS BusinesScape Account,
in United States Dollars and in same day funds, the amount of such Advance, and
(B) cause the proceeds of such Advance to be sent by wire transfer to the
deposit account at a bank in the United States as the Borrower may specify in
the notice of such Advance.
(iii) If any accrued interest on any Advances, or any fee
or other amount due and payable under Loan Documents (other than principal on
any Advance) payable hereunder shall not be paid by or on behalf of the Borrower
as contemplated by the Section entitled "Payments and Computations", as set
forth in the Basic Loan Terms when such interest, fee or other amount becomes
due and payable, the Borrower shall be deemed to have requested the Lender to
make, and shall be deemed to agree to, an Advance hereunder on the due date of,
and in the amount of, such interest, fee or other amount. Upon fulfillment of
the applicable
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conditions set forth in Article III, the Lender may, in its sole discretion on
such date, (A) make available to the Borrower, by means of a credit to the
Borrower's MS BusinesScape Account in United States Dollars and in same day
funds, the amount of such Advance and (B) cause the proceeds of such Advance to
be applied to the payment of such interest, fee or other amount. If, however, on
such date the aggregate outstanding principal amount of the Advances shall be
$250,000 or less, the Borrower may, on or before the 20th day of the month next
following such date, notify the Lender that the Borrower does not so request or
agree to such Advance made pursuant to this clause (iii) and that the Borrower
has paid or will pay such interest, fee or other amount by other means. If the
Borrower shall so notify the Lender, such Advance and such application of
proceeds pursuant to this clause (iii) shall be cancelled and the Lender shall
be deemed not to have so made such Advance or applied the proceeds thereof (and,
for purposes of this Agreement, such Advance shall not be outstanding). If,
however, the Borrower shall not so notify the Lender on or before such 20th day,
the Borrower shall be deemed to have confirmed its agreement to such Advance.
(b) The obligation of the Lender to make the Advances is subject
to fulfillment of the conditions set forth in Article III hereof.
Section 2.03 Terms of Advances and Repayment. The Advances shall bear
interest and be repaid in accordance with the terms and conditions set forth in
the Basic Loan Terms.
Section 2.04 Taxes. The Borrower shall pay any present or future stamp
or documentary taxes or any other excise or property taxes, charges or similar
levies that arise from any payment made hereunder or from the execution,
delivery or registration or recording of, performing under, or otherwise with
respect to, this Agreement, the Note, the Deed of Trust or any other Loan
Document.
Section 2.05 Evidence of Debt. The Lender shall maintain in accordance
with its usual practice an account or accounts evidencing the indebtedness of
the Borrower to the Lender resulting from the Advances from time to time,
including the amounts of principal and interest payable and paid to the Lender
from time to time hereunder or under the Note. Entries made in good faith by the
Lender in such account or accounts shall be prima facie evidence of the amount
of principal and interest due and payable or to become due and payable from the
Borrower to the Lender under this Agreement, absent manifest error, provided,
however, that the failure of the Lender to make an entry, or any finding that an
entry is incorrect, in such account or accounts shall not limit or otherwise
affect the obligations of the Borrower under the Note, this Agreement or any
other Loan Document.
Section 2.06 NRS 106.300-400. Notwithstanding anything to the contrary
contained in this Agreement, if (a) the Lender shall receive a notice of
termination contemplated under NRS 106.300-400 (referred to in Paragraph 55 of
the Deed of Trust), or (b) the Lender shall receive any such notice of
termination in connection with Paragraph 55 of the Third Deed of Trust the
Commitment shall immediately and automatically terminate and the Borrower shall
cease to be entitled to any Advance hereunder. Moreover, the Lender shall not be
required to pay any Check or to fund any use of the Card after receipt of such
notice. The Borrower and the Guarantor agree that no inference of a Commitment
larger than $2,000,000 shall be drawn from the $3,000,000 figure set forth in
the said Paragraph 55.
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ARTICLE III
CONDITIONS OF LENDING
Section 3.01 Conditions Precedent to First Advance. The Borrower will be
entitled to receive the first Advance on and as of the first date (the
"Effective Date") on which all of the following conditions precedent have been
satisfied:
(a) The MS BusinesScape Account shall continue to exist.
(b) The Lender shall have received, and be satisfied with, (i)
any amendments to the organizational documents for the Borrower and the
Corporate Guarantor since the date of the closing of the loan made pursuant to
the Other Line of Credit Agreement, as may be requested by the Lender and (ii)
the organization documents for S&W Boston.
(c) The Corporate Guarantor shall own all the membership
interests in the Borrower and in S&W Boston and shall be the sole member of both
the Borrower and S&W Boston.
(d) The Borrower shall have paid the facility fee payable
pursuant to the Basic Loan Terms, as well as the other payment items set forth
on the Closing Agenda including, without limitation, the fees and disbursements
of New York counsel to the Lender associated herewith.
(e) The Lender shall have received, and be satisfied with, the
documents and other items listed on the Closing Agenda including, without
limitation, an estoppel certificate from the lessor under the Subject Lease.
(f) The following statements shall be true (and the execution and
delivery of this Agreement and the other Loan Documents by the Borrower and the
Guarantors shall constitute a representation and warranty by the Borrower and
the Guarantors that on the date of such execution and delivery such statements
are true):
(i) the representations and warranties of the Borrower and
the Guarantors contained in Section 4.01 hereof and in each other Loan Document
are correct on and as of the date of such execution and delivery of the Loan
Documents, before and after giving effect to any Advance made that day and to
the application of the proceeds therefrom, as though made on and as of such
date, and
(ii) no event has occurred and is continuing, or would
result from any Advance or from the application of the proceeds therefrom, that
constitutes a Default.
(g) The Lender shall have received such other approvals, opinions
and documents as the Lender may reasonably request.
Upon satisfaction of such conditions, the Borrower hereby authorizes the Lender
to insert the Effective Date of this Agreement on page 1 hereof, whereupon the
requested Advances (if any) shall be made available to the Borrower in
accordance with the terms and conditions hereof. At
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any time prior to the Effective Date, the Lender may, in its sole and absolute
discretion, terminate the obligation it may have, if any, to execute and deliver
this Agreement and make the Advances, whereupon any obligation of the Lender to
make the Advances set forth herein or in any other document executed in
connection herewith shall terminate and be void and of no force and effect.
Section 3.02 Conditions Precedent to Each Advance. The obligation of the
Lender to make each Advance shall be subject to the satisfaction of the
following conditions precedent before or concurrently with the making of such
Advance:
(a) The following statements shall be true (and the acceptance by
the Borrower of the proceeds of such Advance shall constitute a representation
and warranty by the Borrower that on the date of such Advance such statements
are true):
(i) the representations and warranties of the Borrower and
the Guarantors contained in Section 4.01 hereof and in each other Loan Document
are correct in all material respects on and as of the date of such Advance,
before and after giving effect to such Advance and to the application of the
proceeds therefrom, as though made on and as of such date, and
(ii) no event has occurred and is continuing, or would
result from such Advance or from the application of the proceeds therefrom, that
constitutes a Default.
(b) After giving effect to such Advance, there would be no unused
availability under the Other Line of Credit Agreement.
(c) The Lender shall have received such other approvals, opinions
and documents as the Lender may reasonably request.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
Section 4.01 Representations and Warranties of the Borrower and the
Guarantors. In addition to the representations and warranties set forth in
Schedule II, each of the Borrower and the Guarantors represents and warrants as
follows:
(a) The Borrower and the Guarantors (i) are each duly organized,
validly existing and in good standing under the laws of the state of its
organization, (ii) are each duly qualified and in good standing as a foreign
limited liability company or corporation (as applicable) in each other
jurisdiction (including Nevada, in the case of the Borrower, New York, in the
case of the Corporate Guarantor and Massachusetts, in the case of S&W Boston) in
which it owns or leases property or in which the conduct of its business
requires it to so qualify, except where the failure to so qualify would not be
reasonably likely to have a Material Adverse Effect, and (iii) has all requisite
organizational power and authority (including, without limitation, all
governmental licenses, agreements and other approvals) to own and lease and
operate its respective properties and to carry on its respective business as now
conducted and as proposed to be conducted.
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(b) The execution, delivery and performance by the Borrower and
the Guarantors of the Loan Documents to which each of them is a party are within
their respective organizational powers, have been duly authorized by all
necessary limited liability company or corporate action (as applicable), and do
not contravene (i) the Borrower's or the Guarantors' charter, by-laws, articles
of organization or incorporation or limited liability company agreement (as
applicable), (ii) any law or any contractual restriction binding on or affecting
the Borrower or the respective Guarantors, (iii) result in the breach of, or
constitute a default or require any payment to be made under, any loan
agreement, credit agreement, indenture, mortgage, deed of trust, bond, note,
lease or other instrument or agreement binding on or affecting the Borrower,
either of the Guarantors or any of their properties, or (iv) except for the
Liens created under the Loan Documents, result in or require the creation or
imposition of any Lien upon or with respect to any of the properties of the
Borrower or the Guarantors.
(c) No authorization or approval or other action by, and no
notice to or filing with, any governmental authority or regulatory body or any
other third party is required for (i) the due execution, delivery and
performance by the Borrower or the Guarantors of the Loan Documents to which any
of them is a party, or (ii) the grant by the Borrower of the Liens granted by it
pursuant to the Collateral Documents to which it is a party.
(d) The Loan Documents to which any of the Borrower or the
Guarantors are a party have been duly executed and delivered by the Borrower and
the Guarantors, and are the legal, valid and binding obligations of the Borrower
and the Guarantors enforceable against the Borrower and the Guarantors in
accordance with their respective terms. The "Loan Documents" (as such term is
defined in each of the First Loan Agreement, the Second Loan Agreement, and the
Other Line of Credit Agreement respectively) to which the Borrower or the
Corporate Guarantor are a party remain in full force and effect, subject to the
effect of the Covenants Agreement.
(e) Except as set forth in the Corporate Guarantor's most recent
10-Q filing with the Securities and Exchange Commission, there is no pending or
threatened action or other proceeding affecting any of the Borrower or the
Guarantors before any court, governmental agency or arbitrator that (i) could be
reasonably likely to have a Material Adverse Effect, or (ii) purports to affect
the legality, validity or enforceability of this Agreement, the Note, the Deed
of Trust or any other Loan Document to which the Borrower or the Guarantors are
a party, or any of the "Loan Documents" as that term is used in the First Loan
Agreement, the Second Loan Agreement, the Other Line of Credit Agreement, or the
consummation of any of the transactions contemplated hereby or thereby.
(f) The Borrower is not engaged in the business of extending
credit for the purpose of purchasing or carrying margin stock, as defined in
Regulation U issued by the Board of Governors of the Federal Reserve System, and
no proceeds of any of the Advances will be used to purchase or carry any such
margin stock or to extend credit to others for the purpose of purchasing or
carrying any such margin stock.
(g) The Corporate Guarantor owns all of the issued and
outstanding membership interests in the Borrower and S&W Boston and is the sole
manager of the Borrower and S&W Boston.
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(h) To the best of their knowledge, the Trust Property is in
material compliance with all applicable laws, rules, regulations and orders
including, without limitation, those relating to use, occupancy, fire, safety
and zoning (including those in respect of parking and set-back requirements). To
the best of their knowledge, the Trust Property is not the subject of any noted
violation of law. To the best of their knowledge, there have been no changes or
introductions to, removals from or activities conducted on the Trust Property
that would adversely alter or effect the environmental assessment of the Trust
Property which was reviewed in connection with the closing under the First Loan
Agreement.
(i) There have been no exterior changes to the buildings or other
improvements located at the Trust Property (and no additions at the Trust
Property) other than conversion of a garbage shed to a concrete structure, since
the date of the survey certified to the Lender and insured by the Lender's
existing title policies issued in connection with the closing under the First
Loan Agreement, the Second Loan Agreement and the Other Line of Credit
Agreement.
(j) The License Agreement and the Sublicense Agreement are
unamended and in full force and effect, and there are no defaults thereunder, or
events which with the giving of notice and/or the passage of time, could result
in a default thereunder.
(k) "S&W of Las Vegas, L.L.C." is the proper legal name of the
Borrower and it is a Delaware limited liability company. "The ▇▇▇▇▇ & Wollensky
Restaurant Group, Inc." is the proper legal name of the Corporate Guarantor and
it is a Delaware Corporation. "▇▇▇▇▇ & Wollensky of Boston LLC" is the proper
legal name of S&W Boston and it is a Delaware limited liability company. As of
the Effective Date, each of the Borrower and the Guarantors have only those
Subsidiaries and Affiliates as are listed on Schedule 4.01(k).
(l) To the best of their knowledge, there are no "Events of
Default", or events that with the giving of notice, the passage of time or both,
shall become "Events of Default", existing and/or continuing under the First
Loan Agreement, the Second Loan Agreement, the Other Line of Credit Agreement,
or under any documents entered into in connection with either of them. For the
purposes of this clause (l), the term "Events of Default" shall have the meaning
assigned to such term in the First Loan Agreement, the Second Loan Agreement or
the Other Line of Credit Agreement, as applicable.
(m) The Borrower, each of its Affiliates and each Person who, to
its knowledge has an economic interest in the Borrower, or, to the Borrower's
knowledge, has or will have an interest in the transaction contemplated by this
Agreement or in the Trust Property or will participate, in any manner
whatsoever, in the Loan, is: (i) not a "blocked" person listed in the Annex to
Executive Order Nos. 12947, 13099 and 13224 and all modifications thereto or
thereof (as used in this Section only, the "Annex"); (ii) in full compliance
with the requirements of the USA Patriot Act of 2001, 107 Public Law 56 (October
26, 2001) and in other statutes and all orders, rules and regulations of the
United States government and its various executive departments, agencies and
offices, related to the subject matter of the Patriot Act, including Executive
Order 13224 effective September 24, 2001 (the "Patriot Act") and all other
requirements contained in the rules and regulations of the Office of Foreign
Assets Control, Department of the Treasury (as used in this Section only,
"OFAC"); (iii) operated under policies,
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procedures and practices, if any, that are in compliance with the Patriot Act
and available to the Lender for the Lender's review and inspection during normal
business hours and upon reasonable prior notice; (iv) not in receipt of any
notice from the Secretary of State or the Attorney General of the United States
or any other department, agency or office of the United States claiming a
violation or possible violation of the Patriot Act; (v) not listed as a
Specially Designated Terrorist (as defined in the Patriot Act) or as a "blocked"
person on any lists maintained by the OFAC pursuant to the Patriot Act or any
other list of terrorists or terrorist organizations maintained pursuant to any
of the rules and regulations of the OFAC issued pursuant to the Patriot Act or
on any other list of terrorists or terrorist organizations maintained pursuant
to the Patriot Act; (vi) not a Person who has been determined by competent
authority to be subject to any of the prohibitions contained in the Patriot Act;
and (vii) not owned or controlled by or now acting and or will in the future act
for or on behalf of any Person named in the Annex or any other list promulgated
under the Patriot Act or any other Person who has been determined to be subject
to the prohibitions contained in the Patriot Act.
ARTICLE V
COVENANTS OF THE BORROWER AND THE GUARANTORS
Section 5.01 Affirmative Covenants. So long as any Advance shall remain
unpaid or the Lender shall have any Commitment hereunder, the Borrower (and,
where specifically indicated, the Guarantors) will (in addition to those
affirmative covenants set forth on Schedule II):
(a) Compliance with Laws, Etc. Comply and cause each of its
Subsidiaries to comply, with all applicable laws, rules, regulations and orders,
such compliance to include, without limitation, compliance with ERISA.
(b) Payment of Taxes, Etc. Pay and discharge, and cause each of
its Subsidiaries to pay and discharge, before the same shall become delinquent,
(i) all taxes, assessments and governmental charges or levies imposed upon it or
upon its property subject to the right to contest as set forth in the Deed of
Trust and (ii) all lawful claims that, if unpaid, might by law become a Lien
upon its property.
(c) Maintenance of Insurance. Maintain, and cause each of its
Subsidiaries to maintain, insurance as required under the Deed of Trust and the
Security Agreement, and otherwise with responsible and reputable insurance
companies or associations in such amounts and covering such risks as is usually
carried by companies engaged in similar businesses and owning similar properties
in the same general areas in which the Borrower or such Subsidiary operates.
Each of the Borrower and the Guarantors shall maintain insurance coverage which
complies with the workers' compensation and employees' liability laws of all
states in which the Borrower and the Guarantors shall be required to maintain
such insurance.
(d) Preservation of Corporate or Limited Liability Company
Existence, Etc. Preserve and maintain, and cause each of its Subsidiaries to
preserve and maintain, the Borrower's and S&W Boston's limited liability company
existence, and the Corporate
8
Guarantor's corporate existence, as well as their respective rights (charter and
statutory) and franchises.
(e) Visitation Rights. In the case of the Borrower and the
Guarantors, at any reasonable time and from time to time, upon reasonable notice
during normal business hours, permit the Lender or any agents or representatives
thereof, to examine and make copies of and abstracts from the records and books
of account of, and visit the properties of, the Borrower and the Guarantors, and
any of their respective Subsidiaries, and to discuss the affairs, finances and
accounts of the Borrower and the Guarantors, and any of their respective
Subsidiaries, with any of their officers or directors and with their independent
certified public accountants.
(f) Keeping of Books. In the case of the Borrower and the
Guarantors, keep, and cause each of their respective Subsidiaries to keep,
proper books of record and account, in which full and correct entries shall be
made of all financial transactions and the assets and business of the Borrower
and the Guarantors in accordance with GAAP.
(g) Maintenance of Properties, Etc. Maintain and preserve, and
cause each of its Subsidiaries to maintain and preserve, all of its properties
that are used or useful in the conduct of its business (i) as required under the
Deed of Trust and the Security Agreement with respect to the Trust Property and
(ii) otherwise in good working order and condition, ordinary wear and tear
excepted.
(h) Transactions with Affiliates. Conduct, and cause each of its
Subsidiaries to conduct, all business or transactions otherwise permitted under
the Loan Documents with any of the Borrower's Affiliates on terms that are fair
and reasonable and no less favorable to the Borrower than it would obtain in a
comparable arm's-length transaction with a Person not an Affiliate.
(i) Reporting Requirements. In the case of the Borrower and the
Corporate Guarantor, furnish to the Lender all financial statements, reports,
documents and other information at the times and in accordance with the
requirements set forth in Paragraph (b) of Schedule II.
(j) Maintenance of MS BusinesScape Account. In the case of the
Borrower and the Corporate Guarantor, maintain its MS BusinesScape Account.
(k) Further Assurances. In the case of the Borrower and the
Guarantors, promptly upon request by the Lender, do, execute, acknowledge,
deliver, record, re-record, file, re-file, register and re-register any and all
such further acts, deeds, conveyances, pledge agreements, mortgages, deeds of
trust, trust deeds, assignments, financing statements and continuations thereof,
termination statements, notices of assignment, transfers, certificates,
assurances and other instruments as the Lender may reasonably require from time
to time in order to (i) carry out more effectively the purposes of the Loan
Documents, (ii) to the fullest extent permitted by applicable law, subject the
Borrower's or any of its Subsidiaries' properties, assets, rights or interests
to the Liens now or hereafter intended to be covered by any of the Collateral
Documents, (iii) perfect and maintain the validity, effectiveness and priority
of any of the Collateral Documents and any of the Liens intended to be created
thereunder and (iv) assure,
9
convey, grant, assign, transfer, preserve, protect and confirm more effectively
unto the Lender the rights granted or now or hereafter intended to be granted to
the Lender under any Loan Document or under any other instrument executed in
connection with any Loan Document to which the Borrower or the Guarantors or any
of their respective Subsidiaries is or is to be a party, and cause each of its
Subsidiaries to do so.
(l) Subordination of Borrower Obligations. At the request of the
Lender, all obligations of the Borrower to either of the Guarantors will be
subordinated to the obligations of the Borrower to the Lender under the Loan
Documents, which subordination shall be pursuant to documentation in form and
substance satisfactory to the Lender.
(m) License Agreement. In the case of the Borrower and the
Guarantors, preserve, protect, renew and keep in full force and effect its
rights, licenses, permits, patents, trademarks, trade names and franchises,
including, without limitation, the rights granted to the Corporate Guarantor
under the License Agreement and the rights granted to the Borrower under the
Sublicense Agreement.
Section 5.02 Negative Covenants. So long as any Advance shall remain
unpaid or the Lender shall have any Commitment hereunder, the Borrower (and the
Corporate Guarantor as to subparagraphs (i) and (j) below) will not (in addition
to those negative covenants set forth in Schedule II):
(a) Liens, Etc. Create or suffer to exist, any Lien on or with
respect to any of its properties, whether now owned or hereafter acquired, other
than as set forth in Paragraph (c) of Schedule II.
(b) Mergers, Etc. Merge or consolidate with or into, or convey,
transfer, lease or otherwise dispose of (whether in one transaction or in a
series of transactions) all or substantially all of its assets to (whether now
owned or hereafter acquired), any Person, or permit any of its Subsidiaries to
do so.
(c) Debt. Create, incur, assume or suffer to exist, or permit any
of its Subsidiaries to create, incur, assume or suffer to exist, any Debt other
than as set forth in Paragraph (d) of Schedule II.
(d) Change in Nature of Business, Management or Ownership. Make,
or permit any of its Subsidiaries to make, any material change in the nature of
its business as carried on at the date hereof, in the identity of the manager of
the Borrower (under its limited liability company agreement), or in the
composition of the current executive management of the Borrower or in its equity
ownership, or operate the restaurant at the Trust Property under any name other
than "▇▇▇▇▇ & Wollensky". Notwithstanding the foregoing, the withdrawal of ▇▇▇▇
▇. ▇▇▇▇▇▇▇▇ from the management of the Borrower shall not constitute a breach of
this Section 5.02(d), provided that the Lender is reasonably satisfied with the
Borrower's management following such withdrawal.
(e) Sales, Etc., of Assets. Sell, lease, transfer or otherwise
dispose of, or permit any of its Subsidiaries to sell, lease, transfer or
otherwise dispose of, any assets, or grant
10
any option or other right to purchase, lease or otherwise acquire any assets
other than (i) assets to be sold in the ordinary course of business and (ii)
assets to be sold or disposed of in the ordinary course of business which are no
longer necessary or required in the conduct of its business. The forgoing
exceptions (i) and (ii) are subject to compliance with the applicable Collateral
Documents.
(f) Investments in Other Persons. Create or acquire any
Subsidiary without the express written consent of the Lender, or make or hold,
or permit any of its Subsidiaries to make or hold, any Investment in any Person.
(g) Restricted Payments. Declare or pay any dividends, purchase,
redeem, retire, defease or otherwise acquire for value any of its membership
interests now or hereafter outstanding, return any capital to its members (or
the equivalent Persons thereof) as such, make any distribution of assets,
membership interests, obligations or securities to its members (or the
equivalent Persons thereof) as such, or issue or sell any membership interests.
(h) Lease Obligations. Create, incur, assume or suffer to exist,
or permit any of its Subsidiaries to credit, incur, assume or suffer to exist,
any obligations as lessee other than as set forth in Paragraph (e) of Schedule
II.
(i) Fee Ownership of Property. Acquire, or permit any Affiliate
of the Borrower (including either of the Guarantors) to acquire, fee ownership
of the property leased under the Subject Lease (and the improvements and
equipment thereon) unless simultaneously with such acquisition, the Lender
obtains a first priority fee deed of trust encumbering such property,
improvements and equipment in form and substance satisfactory to the Lender.
(j) License Agreement and Sublicense Agreement. Enter into any
amendment to the License Agreement or the Sublicense Agreement without the
written consent of the Lender, which consent shall not unreasonably withheld.
ARTICLE VI
EVENTS OF DEFAULT
Section 6.01 Events of Default. If any of the following events ("Events
of Default") shall occur and be continuing:
(a) The Borrower shall fail to pay (i) any principal of any
Advance when the same becomes due and payable; or (ii) the Borrower shall fail
to pay any interest or to make any payment of fees or other amounts payable
under this Agreement or the Note within five days after the same becomes due and
payable; or
(b) Any representation or warranty made by the Borrower or the
Guarantors (or by any of their respective officers, or members) herein or in any
other Loan Document, or in connection with this Agreement or any other Loan
Document, shall prove to have been incorrect or misleading in any material
respect when made or as of the date of the Loan; or
11
(c) (i) The Borrower or the Guarantors (as applicable) shall fail
to perform or observe any term, covenant or agreement contained in Section
5.01(c), (d), (h), (j), (l), or (m) or 5.02, or (ii) the Borrower or the
Corporate Guarantor (as applicable) shall fail to perform or observe any term,
covenant or agreement contained in the Covenants Agreement; or (iii) the
Borrower or the Guarantors (as applicable) shall fail to perform or observe any
other term, covenant or agreement contained in this Agreement on its part to be
performed or observed if such failure described in this subsection (c)(iii)
shall remain unremedied for 10 Business Days after the earlier of (x) the time
the Borrower or such Guarantors (as applicable) becomes aware or should have
reasonably become aware of such failure, or (y) notice from the Lender; or (iv)
the Corporate Guarantor shall at any time cease to own all of the membership
interests in the Borrower or S&W Boston; or (v) an "Event of Default" (as
defined therein, where applicable) or a default beyond applicable periods of
notice and grace, if any, shall occur under a Loan Document other than this
Agreement; or
(d) (i) The Borrower or the Guarantors shall fail to pay any
principal of or premium or interest on any Debt (other than the Debt outstanding
hereunder) of the Borrower or the Guarantors (as the case may be), when the same
becomes due and payable (whether by scheduled maturity, required prepayment,
acceleration, demand or otherwise), and such failure shall continue after the
applicable grace period, if any, specified in the agreement or instrument
relating to such Debt; or (ii) any other event shall occur or condition shall
exist under any agreement or instrument relating to any such Debt and shall
continue after the applicable grace period, if any, specified in such agreement
or instrument, if the effect of such event or condition is to accelerate, or to
permit the acceleration of, the maturity of such Debt; or any such Debt shall be
declared to be due and payable, or required to be prepaid or redeemed (other
than by a regularly scheduled required prepayment or redemption), purchased or
defeased, or an offer to prepay, redeem, purchase or defease such Debt shall be
required to be made, in each case prior to the stated maturity thereof. The
provisions of clause (i) of this subparagraph (d) shall apply to (x) any Debt of
the Borrower or the Guarantors to the Lender or any of its Affiliates in any
amount, and (y) any Debt to any other creditor for borrowed money in excess of
$100,000 with respect to the Borrower or S&W Boston, and $1,000,000 with respect
to the Corporate Guarantor, unless the Lender determines, in its reasonable
judgment, that the default to such other creditor is subject to a bona fide
dispute; or
(e) Any of the Borrower or the Guarantors shall voluntarily
dissolve, liquidate or terminate operations, or shall generally not pay its
debts as such debts become due, or shall admit in writing its inability to pay
its debts generally, or shall make a general assignment for the benefit of
creditors; or any proceeding shall be instituted by or against any of the
Borrower or the Guarantors seeking to adjudicate it a bankrupt or insolvent, or
seeking liquidation, winding up, reorganization, arrangement, adjustment,
protection, relief, or composition of it or its debts under any law relating to
bankruptcy, insolvency or reorganization or relief of debtors, or seeking the
entry of an order for relief or the appointment of a receiver, trustee,
custodian or other similar official for it or for any substantial part of its
property and, in the case of any such proceeding instituted against it (but not
instituted by it), either (A) such proceeding shall remain undismissed or
unstayed for a period of 10 days, or (B) any of the actions sought in such
proceeding (including, without limitation, the entry of an order for relief
against, or the appointment of a receiver, trustee, custodian or other similar
official for, it or for any substantial part of its
12
property) shall occur; or any of the Borrower or the Guarantors shall take any
action to authorize any of the actions set forth above in this subsection (e);
or
(f) Any judgment or order for the payment of money in excess of
$100,000 shall be rendered against the Borrower or S&W Boston, or in excess of
$200,000 (or $300,000 in the case of the lawsuit referred to in Paragraph 2(e)
of the Covenants Agreement) shall be rendered against the Corporate Guarantor
and either (i) enforcement proceedings shall have been commenced by any creditor
upon such judgment or order or (ii) there shall be any period of ten (10)
consecutive days during which a stay of enforcement of such judgment or order,
by reason of a pending appeal or otherwise, shall not be in effect; or
(g) Any of the Borrower or the Guarantors or any of the
Borrower's or the Guarantors' ERISA Affiliates shall incur one or more of the
following: (i) the occurrence of any ERISA Event; (ii) the partial or complete
withdrawal of the Borrower or the Guarantors, or any of the Borrower's or the
Guarantors' ERISA Affiliates from a Multiemployer Plan; or (iii) the
reorganization or termination of a Multiemployer Plan; or
(h) Any Lien granted pursuant to any Collateral Document shall
for any reason cease to be a valid and perfected first priority lien on and
security interest in the Collateral purported to be covered thereby; or
(i) The Guaranty or the Environmental Guaranty shall for any
reason cease to be a valid and binding obligation or enforceable against either
of the Guarantors (or the Borrower, in the case of the Environmental Guaranty),
or (ii) either of the Guarantors shall repudiate, revoke or deny any liability
under the Guaranty or the Environmental Guaranty (or the Borrower shall do the
same with respect to the Environmental Guaranty); or
(j) A default beyond any applicable notice and/or grace period
shall have occurred under the License Agreement or the Sublicense Agreement; or
(k) A Change in Control with respect to the Corporate Guarantor
shall have occurred; or
(l) Any of the Borrower or the Guarantors, or an Affiliate of
either of them, or a holder of any substantial equity interest in any of the
Borrower or the Guarantors or in any such Affiliate shall (i) become named on
any list of persons who are or may be engaged in or who have been or may have
been engaged in possible criminal activity or other wrongdoing, which list is
promulgated under the Patriot Act, or (ii) be indicted, arraigned or custodially
detained on charges involving money laundering or any predicate crime to money
laundering;
then, and in any such event, the Lender may, by notice to the Borrower and the
Guarantors, declare the Advances, all interest thereon and all other amounts
payable under this Agreement to be forthwith due and payable, whereupon the
Advances, all such interest and all such amounts shall become and be forthwith
due and payable, without presentment, demand, protest or further notice of any
kind, all of which are hereby expressly waived by the Borrower and the
Guarantors; provided, however, that upon the occurrence of any event described
in subsection (e) above, the Loan, all such interest and all such amounts shall
automatically become and be due
13
and payable, without presentment, demand, protest or any notice of any kind, all
of which are hereby expressly waived by the Borrower and the Guarantors.
ARTICLE VII
MISCELLANEOUS
Section 7.01 Amendments, Etc. No amendment or waiver of any provision of
this Agreement nor consent to any departure by the Borrower or the Guarantors
therefrom, shall in any event be effective unless the same shall be in writing
and signed by the Lender, the Borrower and the Guarantors, and then such waiver
or consent shall be effective only in the specific instance and for the specific
purpose for which given.
Section 7.02 Notices, Etc. All notices and other communications provided
for hereunder shall be in writing (including fax communication and any other
method of communication authorized by the Lender) and mailed, faxed, or
otherwise sent or delivered as described in the Basic Loan Terms.
Section 7.03 No Waiver; Remedies. No failure on the part of the Lender
to exercise, and no delay in exercising, any right hereunder shall operate as a
waiver thereof; nor shall any single or partial exercise of any such right
preclude any other or further exercise thereof or the exercise of any other
right. The remedies herein provided are cumulative and not exclusive of any
remedies provided by law.
Section 7.04 Costs and Expenses; Indemnification.
(a) The Borrower and the Guarantors jointly and severally agree
to pay on demand all fees, costs and expenses reasonably incurred by the Lender
in connection with the preparation, negotiation, execution, delivery,
administration, modification and amendment of this Agreement, the Note, the
Collateral Documents and the other Loan Documents, including, without
limitation, search, filing and recording fees and taxes, costs of reappraisals
required by the Lender and the fees and expenses of counsel for the Lender with
respect thereto, and with respect to advising the Lender as to its rights and
responsibilities under such documents. The Borrower and the Guarantors further
jointly and severally agree to pay on demand all fees, costs and expenses
reasonably incurred by the Lender, if any (including, without limitation,
counsel fees and expenses), in connection with the enforcement (whether through
negotiations, legal proceedings or otherwise) of this Agreement, the Note, the
Collateral Documents and the other Loan Documents, including, without
limitation, reasonable fees and expenses of counsel for the Lender in connection
with the enforcement of rights under this Section 7.04(a). Each of the Borrower
and the Guarantors hereby authorizes the Lender and its Affiliates at any time
and from time to time, without notice to the Borrower or the Guarantors, and
whether or not the Lender shall have made any demand or an Event of Default
shall have occurred, to charge any account of any of the Borrower or the
Guarantors maintained by the Lender or its Affiliates against such fees, costs
and expenses. The rights of the Lender and its Affiliates under this Section are
in addition to other rights and remedies (including, without limitation, rights
of set-off) that the Lender and its Affiliates may have.
14
(b) The Borrower and the Guarantors agree to indemnify and hold
harmless the Lender and each of its Affiliates and officers, directors,
employees, agents and advisors (each, an "Indemnified Party") from and against
any and all claims, damages, losses, liabilities and expenses (including,
without limitation, reasonable fees and expenses of counsel) that may be
incurred by or asserted or awarded against any Indemnified Party, in each case
arising out of or in connection with or by reason of (including, without
limitation, in connection with any investigation, litigation or proceeding or
preparation of a defense in connection therewith) this Agreement, any of the
transactions contemplated herein or the actual or proposed use of the proceeds
of the Loan except to the extent such claim, damage, loss, liability or expense
is found in a final, non-appealable judgment by a court of competent
jurisdiction to have resulted from such Indemnified Party's gross negligence or
willful misconduct. In the case of an investigation, litigation or other
proceeding to which the indemnity in this Section 7.04(b) applies, such
indemnity shall be effective whether or not such investigation, litigation or
proceeding is brought by the Borrower, its directors, equityholders or creditors
or an Indemnified Party or any other Person, whether or not any Indemnified
Party is otherwise a party thereto and whether or not the transactions
contemplated hereby are consummated. Each of the Borrower and the Guarantors
also agrees not to assert any claim against the Lender, any of its Affiliates,
or any of their directors, officers, employees, attorneys and agents, on any
theory of liability, for special, indirect, consequential or punitive damages
arising out of or otherwise relating to this Agreement, any of the transactions
contemplated herein or the actual or proposed use of the proceeds of the Loan.
(c) Without prejudice to the survival of any other agreement of
the Borrower or the Guarantors hereunder, the agreements and obligations of the
Borrower and the Guarantors contained in this Section 7.04 shall survive the
payment in full of principal, interest and all other amounts payable hereunder,
under the Note and the other Loan Documents.
Section 7.05 Right of Set-off. Upon the occurrence and during the
continuance of any Event of Default, the Lender and its Affiliates are hereby
authorized at any time and from time to time, to the fullest extent permitted by
law, to sell, liquidate, transfer or otherwise apply any assets or securities of
any of the Borrower or the Guarantors held by the Lender or any of its
Affiliates and set off and apply any and all deposits (general or special, time
or demand, provisional or final) at any time held and other indebtedness at any
time owing by the Lender or such Affiliates to or for the credit or the account
of any of the Borrower or the Guarantors against any and all of the respective
obligations of the Borrower or Guarantors now or hereafter existing under this
Agreement, the Note, the Guaranty, the Environmental Guaranty or any other Loan
Document, whether or not the Lender shall have made any demand under this
Agreement or such other Loan Document and although such obligations may be
unmatured. The rights of the Lender and its Affiliates under this Section are in
addition to other rights and remedies (including, without limitation, other
rights of set-off) that the Lender and its Affiliates may have.
Section 7.06 Binding Effect; Successors and Assigns. This Agreement
shall become effective on the Effective Date and thereafter shall be binding
upon and inure to the benefit of the Borrower, the Guarantors, the Lender and
their respective successors and assigns, except that neither the Borrower nor
the Guarantors shall have the right to assign its rights hereunder or any
interest herein without the prior written consent of the Lender.
15
Section 7.07 Governing Law. This Agreement shall be governed by, and
construed in accordance with, the laws of the State of New York.
Section 7.08 Execution in Counterparts. This Agreement may be executed
in any number of counterparts and by different parties hereto in separate
counterparts, each of which when so executed shall be deemed to be an original
and all of which taken together shall constitute one and the same agreement.
Delivery of an executed counterpart of a signature page to this Agreement by fax
shall be effective as delivery of an original executed counterpart of this
Agreement.
Section 7.09 Interest Rate Limitation. Anything herein to the contrary
notwithstanding, if at any time the applicable interest rate, together with all
fees and charges that are treated as interest under applicable law
(collectively, the "Charges"), as provided for herein or in any other Loan
Document, or otherwise contracted for, charged, received, taken or reserved by
the Lender, shall exceed the maximum lawful rate (the "Maximum Rate") that may
be contracted for, charged, taken, received or reserved by the Lender in
accordance with applicable law, the rate of interest payable on the Loan,
together with all Charges payable to the Lender, shall be limited to the Maximum
Rate. Neither the Borrower nor the Guarantor shall ever be liable for unearned
interest thereon or shall ever be required to pay interest thereon in excess of
the maximum amount that may be lawfully charged under applicable law from time
to time in effect, and the provisions of this Section 7.09 shall control over
all other provisions of the Loan Documents that may be in conflict. If (a) the
maturity of the obligations of the Borrower under Note or this Agreement is
accelerated for any reason, (b) any of such obligations are prepaid and as a
result any amounts held to constitute interest are determined to be in excess of
the legal maximum or (c) the Lender or any other holder of any or all of the
obligations of the Borrower under this Agreement shall otherwise collect moneys
that are determined to constitute interest that would otherwise increase the
interest on any or all of such obligations to an amount in excess of that
permitted to be charged by applicable law then in effect, then all such sums
determined to constitute interest in excess of such legal limit shall, without
premium, penalty, be promptly applied to reduce the then outstanding principal
of such obligations or, at the Lender's or such holder's option, shall be
promptly returned to the Borrower or the other payor thereof upon such
determination.
Section 7.10 Jurisdiction, Etc.
(a) Each of the parties hereto hereby irrevocably and
unconditionally submits, for itself and its property, to the nonexclusive
jurisdiction of any New York State court or federal court of the United States
of America sitting in New York City, and any appellate court from any thereof,
in any action or proceeding arising out of or relating to this Agreement or any
other Loan Document, or for recognition or enforcement of any judgment, and each
of the parties hereto hereby irrevocably and unconditionally agrees that all
claims in respect of any such action or proceeding may be heard and determined
in any such New York State court or, to the extent permitted by law, in such
federal court. Each of the parties hereto consents to the service of copies of
any and all process which may be served in any such action or proceeding by the
mailing of copies of such process to such party at its address specified in
Section 7.02. Each of the parties hereto agrees that a final judgment in any
such action or proceeding shall be conclusive and may be enforced in other
jurisdictions by suit on the judgment or in any other
16
manner provided by law. Nothing in this Agreement or any other Loan Document
shall affect any right that any party may otherwise have to bring any action or
proceeding relating to this Agreement or any other Loan Document in the courts
of any other jurisdiction.
(b) Each of the parties hereto irrevocably and unconditionally
waives, to the fullest extent it may legally and effectively do so, any
objection that it may now or hereafter have to the laying of venue of any suit,
action or proceeding arising out of or relating to this Agreement or any other
Loan Document in any New York State or federal court. Each of the parties hereto
hereby irrevocably waives, to the fullest extent permitted by law, the defense
of an inconvenient forum to the maintenance of such action or proceeding in any
such court.
Section 7.11 Assignments and Participations. The Lender may assign to
one or more Persons all or a portion of its rights and obligations under this
Agreement (including, without limitation, all or a portion of its Commitment and
the Advances owing to it), without notice to, or the consent of the Borrower or
the Guarantors. The Lender may sell participations to one or more Persons (other
than the Borrower or any of its Affiliates) in or to all or a portion of its
rights and obligations under this Agreement (including, without limitation, all
or a portion of its Commitment and the Advances owing to it). The Lender may, in
connection with any assignment or participation or proposed assignment or
participation pursuant to this Section, disclose to the assignee or participant
or proposed assignee or participant, any information relating to the Borrower
and the Guarantors furnished to the Lender by or on behalf of the Borrower or
the Guarantors. In addition, the terms of the Note relating to participations of
the Note shall be applicable to participations of the Lender's rights and
obligations under this Agreement. The Lender represents that as of the date
hereof, it has no present intention of assigning its rights and obligations
under this Agreement (including, without limitation, all or a portion of the
Loan owing to it); provided, however, the foregoing shall in no way impair or
otherwise alter the Lender's rights under this Section.
Section 7.12 WAIVER OF JURY TRIAL. EACH OF THE BORROWER, THE GUARANTORS
AND THE LENDER HEREBY IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY
ACTION, PROCEEDING OR COUNTERCLAIM (WHETHER BASED ON CONTRACT, TORT OR
OTHERWISE) ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN
DOCUMENT, THE ADVANCES OR THE ACTIONS OF THE LENDER OR ANY OF ITS AFFILIATES IN
THE NEGOTIATION, ADMINISTRATION, PERFORMANCE OR ENFORCEMENT HEREOF OR THEREOF.
Section 7.13 Severability of Provisions. Any provision of this Agreement
which is prohibited or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions of this Agreement
or affecting the validity or enforceability of such provision in any other
jurisdiction.
Section 7.14 Headings. Article, section and paragraph headings in this
Agreement are included herein for convenience of reference only and shall not
constitute a part hereof for any other purpose.
17
Section 7.15 Conflicts. Conflicts between this Agreement and any of the
Collateral Documents shall be resolved in favor of the latter.
Section 7.16 Lender Action. The Lender shall have the right, but not the
obligation, to take any action at the Borrower's expense if the Lender believes,
in its reasonable discretion after consultation with Borrower or the Guarantors,
that such action is necessary to avoid the occurrence of a Material Adverse
Effect with respect to the Borrower or the Guarantors, including, without
limitation, curing any defaults under the License Agreement.
Section 7.17 Other Loan Agreements. The parties agree that the Advances
shall be a permitted "Debt", and the Collateral Documents (as they relate to the
Borrower and the Trust Property) shall be permitted "Liens" as those terms are
used in that certain Term Loan Agreement dated as of August 23, 2002 among the
Borrower, the Corporate Guarantor and the Lender, as amended (the "First Loan
Agreement"), in that certain Term Loan Agreement dated as of December 24, 2002
among the Borrower, the Corporate Guarantor, Dallas S & W, L.P. and the Lender,
as amended (the "Second Loan Agreement") and in that certain Line of Credit
Agreement dated as of January 30, 2004 among the Borrower, the Corporate
Guarantor and the Lender (the "Other Line of Credit Agreement").
Section 7.18 Terms Generally. The definitions of terms herein shall
apply equally to the singular and plural forms of the terms defined. Whenever
the context may require, any pronoun shall include the corresponding masculine,
feminine and neuter forms. The words "include", "includes" and "including" shall
be deemed to be followed by the phrase "without limitation". The word "will"
shall be construed to have the same meaning and effect as the word "shall".
Unless the context requires otherwise (a) any definition of or reference to any
agreement, instrument or other document herein shall be construed as referring
to such agreement, instrument or other document as from time to time amended,
supplemented or otherwise modified (subject to any restrictions on such
amendments, supplements or modifications set forth herein), (b) any reference
herein to any Person shall be construed to include such Person's successors and
assigns, (c) the words "herein", "hereof" and "hereunder", and words of similar
import, shall be construed to refer to this Agreement in its entirety and not to
any particular provision hereof, (d) all references herein to Articles,
Sections, Exhibits and Schedules shall be construed to refer to Articles and
Sections of, and Exhibits and Schedules to, this Agreement and (e) the words
"asset" and "property" shall be construed to have the same meaning and effect
and to refer to any and all tangible and intangible assets and properties,
including cash, securities, accounts and contract rights.
Section 7.19 Secured Obligation under Security Agreement. The parties
agree that the obligations of the Borrower under this Agreement and the other
Loan Documents shall be one of the "Secured Obligations" under the Security
Agreement, and that: (a) the term "Deed of Trust" as used therein shall mean the
"Deed of Trust" (as defined in the First Loan Agreement), the "Deed of Trust"
(as defined in the Second Loan Agreement), the "Deed of Trust" (as defined in
the Other Line of Credit Agreement) (such Deed of Trust being herein referred to
as the "Third Deed of Trust") and the "Deed of Trust" (as defined herein); (b)
the term "Assignment of Leases" as used therein shall mean the "Assignment of
Leases" (as defined in the First Loan Agreement), the "Assignment of Leases" (as
defined in the Second Loan Agreement), the "Assignment of Leases" (as defined in
the Other Line of Credit Agreement) and the "Assignment
18
of Leases" (as defined herein); (c) the term "Credit Agreement" as used therein
shall mean the First Loan Agreement, the Second Loan Agreement, the Other Line
of Credit Agreement and this Agreement; and (d) all other capitalized terms
used, but not defined, in the Security Agreement (including, without limitation,
"Loan Documents" and "Note") shall have the meanings given to such terms in the
First Term Loan Agreement, the Second Loan Agreement, the Other Line of Credit
Agreement and in this Agreement, mutatis mutandis.
Section 7.20 Tax Information. Notwithstanding anything herein to the
contrary, the Borrower and the Guarantors (and any employee, representative or
other agent of any of them) may disclose to any and all Persons, without
limitation of any kind, the U.S. federal income tax treatment and the U.S.
federal income tax structure of the transactions contemplated hereby and all
materials of any kind (including opinions or other tax analyses) that are
provided to the Borrower or the Guarantors (or any employee, representative or
other agent of any of them) relating to such tax treatment and tax structure.
However, no disclosure of any information relating to such tax treatment or tax
structure may be made to the extent nondisclosure is reasonably necessary in
order to comply with applicable securities laws.
Section 7.21 Collateral Account. The covenant added to the First Loan
Agreement and the Second Loan Agreement pursuant to Section 3 of the Amendment
to Term Loan Agreements dated as of August 20, 2003 is hereby incorporated by
reference, mutatis mutandis, into this Agreement.
[rest of page deliberately left blank]
19
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their respective representatives thereunto duly authorized, as of
the date first above written.
S&W OF LAS VEGAS, L.L.C.
By: The ▇▇▇▇▇ & Wollensky Restaurant Group,
Inc., Sole Member
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
-------------------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Secretary
STATE OF NEW YORK )
ss.:
COUNTY OF NEW YORK )
On the 20th day of July in the year 2004 before me, the
undersigned, a Notary Public in and for said State, personally appeared ▇▇▇▇ ▇.
▇▇▇▇▇▇, personally known to me or proved to me on the basis of satisfactory
evidence to be the individual whose name is subscribed to the within instrument
and acknowledged to me that he executed the same in his capacity, and that by
his signature on the instrument, the individual, or the person upon behalf of
which the individual acted, executed the instrument.
/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
-------------------------------------------
Notary Public
THE ▇▇▇▇▇ & WOLLENSKY
RESTAURANT GROUP, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
-------------------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Secretary
STATE OF NEW YORK )
ss.:
COUNTY OF NEW YORK )
On the 20th day of July in the year 2004 before me, the
undersigned, a Notary Public in and for said State, personally appeared ▇▇▇▇ ▇.
▇▇▇▇▇▇ , personally known
20
to me or proved to me on the basis of satisfactory evidence to be the individual
whose name is subscribed to the within instrument and acknowledged to me that he
executed the same in his capacity, and that by his signature on the instrument,
the individual, or the person upon behalf of which the individual acted,
executed the instrument.
/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
-------------------------------------------
Notary Public
21
▇▇▇▇▇ & WOLLENSKY OF BOSTON LLC
By: The ▇▇▇▇▇ and Wollensky Restaurant Group,
Inc., Sole Member
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
-------------------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Secretary
STATE OF NEW YORK )
ss.:
COUNTY OF NEW YORK )
On the 20th day of July in the year 2004 before me, the
undersigned, a Notary Public in and for said State, personally appeared ▇▇▇▇ ▇.
▇▇▇▇▇▇, personally known to me or proved to me on the basis of satisfactory
evidence to be the individual whose name is subscribed to the within instrument
and acknowledged to me that he executed the same in his capacity, and that by
his signature on the instrument, the individual, or the person upon behalf of
which the individual acted, executed the instrument.
/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
-------------------------------------------
Notary Public
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
COMMERCIAL FINANCIAL SERVICES, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
-------------------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Secretary
STATE OF NEW YORK )
ss.:
COUNTY OF NEW YORK )
On the 20th day of July in the year 2004 before me, the
undersigned, a Notary Public in and for said State, personally appeared ▇▇▇▇ ▇.
▇▇▇▇▇▇, personally known to me or proved to me on the basis of satisfactory
evidence to be the individual whose name is subscribed to the within instrument
and acknowledged to me that he executed the same in his
22
capacity, and that by his signature on the instrument, the individual, or the
person upon behalf of which the individual acted, executed the instrument.
/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
-------------------------------------------
Notary Public
SCHEDULE I
TO LINE OF CREDIT AGREEMENT WITH
S&W OF LAS VEGAS, L.L.C. AND
THE ▇▇▇▇▇ & WOLLENSKY RESTAURANT GROUP, INC.
CERTAIN DEFINED TERMS
As used in this Agreement, the following terms shall have the following
meanings:
"Advance" means an advance by the Lender to the Borrower pursuant to
Article II.
"Affiliate" means, as to any Person, any other Person that, directly or
indirectly, controls, is controlled by or is under common control with such
Person or is a director or officer of such Person. For purposes of this
definition, the term "control" (including the terms "controlling", "controlled
by" and "under common control with") of a Person means the possession, direct or
indirect, of the power to vote 5% or more of the voting stock of such Person or
to direct or cause the direction of the management and policies of such Person,
whether through the ownership of voting stock, by contract or otherwise.
"Assignment of Leases" means the Absolute Assignment of Rents and Leases
of even date herewith made by the Borrower in favor of the Lender, as the same
may be amended, replaced or restated from time to time.
"Bank One Indiana" means Bank One, Indiana, NA.
"Bank One Ohio" means Bank One, Columbus , NA, Delaware, Ohio.
"Business Day" means a day of the year on which banks are not required
or authorized by law to close in New York City.
"Card" means any MasterCard Business Card debit card issued by Bank One
Indiana for use in connection with the Borrower's MS BusinesScape Account
applicable to the Advances.
"Change in Control" means (a) the acquisition of ownership, directly or
indirectly, beneficially or of record, by any Person or group (within the
meaning of the Securities Exchange Act of 1934 and the rules of the Securities
and Exchange Commission thereunder as in effect on the date hereof) of shares
representing more than 33-1/3% of the aggregate ordinary voting power
represented by the issued and outstanding capital stock of the Corporate
Guarantor, or (b) occupation of a majority of the seats (other than vacant
seats) on the board of directors of the Corporate Guarantor by Persons who were
neither (i) nominated by the board of directors of the Corporate Guarantor nor
(ii) appointed by directors so nominated.
"Charges" has the meaning specified in Section 7.09.
Schedule I-Page 1
"Check" means any check drawn on Bank One Ohio for use in connection
with the Borrower's MS BusinesScape Account applicable to the Advances.
"Closing Agenda" means the Closing Agenda prepared by the Lender and
delivered to the Borrower setting forth the documents and other items to be
executed and/or delivered, and payments to be made, by the parties in connection
with this Agreement.
"Collateral" means all "Collateral" referred to in the Collateral
Documents and all other property that is or is intended to be subject to any
Lien in favor of the Lender.
"Collateral Documents" means the Security Agreement, Deed of Trust, the
Assignment of Leases, all Uniform Commercial Code financing statements with
respect to the Collateral and any other Loan Document pursuant to which any
collateral is granted to the Lender by the Borrower.
"Corporate Guarantor" means The ▇▇▇▇▇ & Wollensky Restaurant Group,
Inc., a Delaware corporation.
"Covenants Agreement" means the Covenants Agreement and Amendment to
Term Loan Agreements dated January 30, 2004 among the Lender, the Borrower, the
Corporate Guarantor and Dallas S&W, L.P., detailing certain financial covenants
made by the Borrower and/or or the Corporate Guarantor to the Lender, which
agreement also amends the First Loan Agreement and the Second Loan Agreement.
"Debt" of any Person means, without duplication, (a) all indebtedness of
such Person for borrowed money or for the deferred purchase price of property or
services (other than current trade payables incurred in the ordinary course of
business), (b) all obligations of such Person evidenced by notes, bonds,
debentures or other similar instruments, (c) all capital lease obligations of
such Person, (d) all obligations of such Person, contingent or otherwise, in
respect of acceptances, letters of credits or similar extensions of credit, (e)
all liabilities secured by any Lien on any property owned by such Person, even
though such Person has not assumed or otherwise become liable for the payment
thereof, (f) all obligations of such Person in respect of interest rate or
currency protection agreements, and (g) all Debt of others guaranteed directly
or indirectly in any manner by such Person. The foregoing is intended to include
any and all indebtedness arising under each of the First Loan Agreement, the
Second Loan Agreement and the Other Line of Credit Agreement.
"Deed of Trust" means a fourth priority Leasehold Deed of Trust of even
date herewith made by the Borrower to the trustee thereunder for the benefit of
the Lender and encumbering the Trust Property, as the same may be amended,
replaced or restated from time to time, and shall include any new (or
replacement) fee deed of trust entered into in the event the Borrower, either of
the Guarantors or an Affiliate acquires the fee interest in the Trust Property.
"Default" means any Event of Default or any event that would constitute
an Event of Default but for the requirement that notice be given or time elapse
or both.
"Effective Date" has the meaning specified in Section 3.01.
Schedule I-Page 2
"Environmental Guaranty" means the Joint and Several Hazardous Material
Guaranty and Indemnification Agreement of even date herewith made by the
Borrower and the Guarantors in favor of the Lender in respect of the Trust
Property, as the same may be amended, replaced or restated from time to time.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended from time to time, and the regulations promulgated and rulings issued
thereunder.
"ERISA Affiliate" means any Person that for purposes of Title IV of
ERISA is a member of the Borrower's or controlled group, or under common control
with the Borrower or within the meaning of Section 414 of the Internal Revenue
Code.
"ERISA Event" means (a) (i) the occurrence of a reportable event, within
the meaning of Section 4043 of ERISA, with respect to any Plan unless the 30-day
notice requirement with respect to such event has been waived by the PBGC, or
(ii) the requirements of subsection (1) of Section 4043(b) of ERISA (without
regard to subsection (2) of such Section) are met with respect to a contributing
sponsor, as defined in Section 4001(a)(13) of ERISA, of a Plan, and an event
described in paragraph (9), (10), (11), (12) or (13) of Section 4043(c) of ERISA
is reasonably expected to occur with respect to such Plan within the following
30 days; (b) the application for a minimum funding waiver with respect to a
Plan; (c) the provision by the administrator of any Plan of a notice of intent
to terminate such Plan pursuant to Section 4041(a)(2) of ERISA (including any
such notice with respect to a plan amendment referred to in Section 4041(e) of
ERISA); (d) the cessation of operations at a facility of the Borrower or any
ERISA Affiliate in the circumstances described in Section 4062(e) of ERISA; (e)
the withdrawal by the Borrower or the Guarantors or any ERISA Affiliate from a
Multiple Employer Plan during a plan year for which it was a substantial
employer, as defined in Section 4001(a)(2) of ERISA; (f) the conditions for the
imposition of a lien under Section 302(f) of ERISA shall have been met with
respect to any Plan; (g) the adoption of an amendment to a Plan requiring the
provision of security to such Plan pursuant to Section 307 of ERISA; or (h) the
institution by the PBGC of proceedings to terminate a Plan pursuant to Section
4042 of ERISA, or the occurrence of any event or condition described in Section
4042 of ERISA that constitutes grounds for the termination of, or the
appointment of a trustee to administer, a Plan.
"Events of Default" has the meaning specified in Section 6.01.
"First Loan Agreement" has the meaning specified in Section 7.17.
"Free Credit Balance" means the amount of any cash that may be withdrawn
from the Borrower's MS BusinesScape Account at any time without creating a
negative balance therein or giving rise to interest charges thereon.
"GAAP" means the generally accepted accounting principles applied in the
United States.
"Guarantors" means the Corporate Guarantor and S&W Boston.
"Guaranty" means the Guaranty of Payment of even date herewith made by
the Guarantors in favor of the Lender in respect of the Loan, as the same may be
amended, replaced or restated from time to time.
Schedule I-Page 3
"Internal Revenue Code" means the Internal Revenue Code of 1986, as
amended from time to time, and the regulations promulgated and rulings issued
thereunder.
"Investment" in any Person means any loan or advance to such Person, any
purchase or other acquisition of any capital stock or Debt or the assets
comprising a division or business unit for a substantial part or all of the
business of such Person, any capital contribution to such Person or any other
direct or indirect investment in such Person, including, without limitation, any
acquisition by way of a merger or consolidation.
"License Agreement" means the Sale and License Agreement dated August
16, 1996 between St. ▇▇▇▇▇ Associates and The New York Restaurant Group, LLC
pursuant to which, among other things, the Corporate Guarantor possesses the
right to use and to sublicense the trademark "▇▇▇▇▇ & Wollensky".
"Lien" means any lien, security interest or other charge or encumbrance
of any kind, or any other type of preferential arrangement having the effect of
a lien or security interest, including, without limitation, the lien or retained
security title of a conditional vendor and any easement, right of way or other
encumbrance on title to real property.
"Loan Documents" means this Agreement, the Note, the Collateral
Documents, the Guaranty, the Environmental Guaranty and any other documents
executed and/or delivered by the Borrower or the Guarantors in connection
therewith, in each case as amended, supplemented, replaced, restated or
otherwise modified from time to time.
"Material Adverse Change" means any material adverse change in the
business, condition (financial or otherwise), operations, performance,
properties or prospects of the Borrower or the Guarantors, or the Borrower, or
the Guarantors and its Subsidiaries taken as a whole.
"Material Adverse Effect" means a material adverse effect on (a) the
business, condition (financial or otherwise), operations, performance,
properties or prospects of the Borrower or the Guarantors, or the Borrower or
the Guarantors and its Subsidiaries taken as a whole, (b) the rights and
remedies of the Lender under this Agreement or (c) the ability of the Borrower
or the Guarantors to perform its obligations under any Loan Document to which it
is a party.
"Maximum Rate" has the meaning specified in Section 7.09.
"▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇" means ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇ Inc., a Delaware
corporation, or any successor thereof.
"MS BusinesScape Account" means, in respect of the Borrower, the MS
BusinesScape Account for Business maintained by the Borrower at ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇, MS BusinesScape Account No.▇▇▇-▇▇▇-▇▇▇ and in respect of the Corporate
Guarantor, the MS BusinesScape Account for Business maintained by the Corporate
Guarantor at ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇, MS BusinesScape Account No. ▇▇▇-▇▇▇▇▇▇-▇▇▇.
"MS BusinesScape Funds" means any of the money market fund shares
credited to the Borrower's MS BusinesScape Account.
Schedule I-Page 4
"Multiemployer Plan" means a multiemployer plan, as defined in Section
4001(a)(3) of ERISA, to which the Borrower or any ERISA Affiliate is making or
accruing an obligation to make contributions, or has within any of the preceding
five plan years made or accrued an obligation to make contributions.
"Multiple Employer Plan" means a single employer plan, as defined in
Section 4001(a)(15) of ERISA, that (a) is maintained for employees of the
Borrower, the Guarantors or any ERISA Affiliate and at least one Person other
than the Borrower, the Guarantors and the ERISA Affiliates or (b) was so
maintained and in respect of which the Borrower, the Guarantors or any ERISA
Affiliate could have liability under Section 4064 or 4069 of ERISA in the event
such plan has been or were to be terminated.
"Note" means the Promissory Note of even date herewith in the original
principal amount of $2,000,000.00 made by the Borrower in favor of the Lender.
"Patriot Act" has the meaning set forth in Section 4.01(m).
"PBGC" means the Pension Benefit Guaranty Corporation (or any
successor).
"Person" means an individual, partnership, corporation (including a
business trust), joint stock company, trust, unincorporated association, joint
venture, limited liability company or other entity, or a government or any
political subdivision or agency thereof.
"Plan" means a Single Employer Plan or a Multiple Employer Plan.
"Second Loan Agreement" has the meaning specified in Section 7.17.
"Security Agreement" means the Security Agreement dated August 23, 2002
made by the Borrower to the Lender, as the same may have been or may be amended,
replaced or restated from time to time.
"Single Employer Plan" means a single employer plan, as defined in
Section 4001(a)(15) of ERISA, that (a) is maintained for employees of the
Borrower, the Guarantors or any ERISA Affiliate and no Person other than the
Borrower, the Guarantors and the ERISA Affiliates or (b) was so maintained and
in respect of which the Borrower, the Guarantors or any ERISA Affiliate could
have liability under Section 4069 of ERISA in the event such plan has been or
were to be terminated.
"Subject Lease" has the meaning set forth in the Deed of Trust.
"Sublicense Agreement" means the Sublicense Agreement dated August 23,
2002 between the Corporate Guarantor and the Borrower.
"Subordinated Debt" of any Person means all Debt completely subordinated
to such Person's obligations to the Lender pursuant to a subordination agreement
in form and substance satisfactory to the Lender.
Schedule I-Page 5
"Subsidiary" of any Person means any corporation, partnership, joint
venture, limited liability company, trust or estate of which (or in which) more
than 50% of (a) the issued and outstanding voting stock of such corporation, (b)
the interest in the capital or profits of such limited liability company,
partnership or joint venture or (c) the beneficial interest in such trust or
estate is at the time directly or indirectly owned or controlled by such Person,
by such Person and one or more of its other Subsidiaries or by one or more of
such Person's other Subsidiaries.
"Termination Date" means the earlier of (a) May 31, 2005, and (b) the
date of termination in whole of the Commitment pursuant to Section 6.01.
"Trust Property" has the meaning given to the term "Trust Property" in
the Deed of Trust.
"United States Dollars" means money of the United States of America.
"Uncovered Debit" means any debit that is at any time in the Borrower's
MS BusinesScape Account resulting from any use of any Card or any Check and that
exceeds the remainder of (i) the sum of the Free Credit Balance and the value of
MS BusinesScape Funds shares in the Borrower's MS BusinesScape Account at such
time minus (ii) any other debits at such time applicable to the Borrower's MS
BusinesScape Account resulting from any transactions other than any use of any
Card or any Check.
Schedule I-Page 6
SCHEDULE II
TO LINE OF CREDIT AGREEMENT WITH
S&W OF LAS VEGAS, L.L.C.,
THE ▇▇▇▇▇ & WOLLENSKY RESTAURANT GROUP, INC. AND
▇▇▇▇▇ & WOLLENSKY OF BOSTON LLC
FINANCIAL REPRESENTATIONS, COVENANTS AND REPORTING
(a) Representation. The Borrower represents and warrants that the
management prepared unaudited statements of operations for the period ended
March 29, 2003, copies of which have been furnished to the Lender, fairly
present the financial condition of the Borrower as at such dates, all in
accordance with GAAP consistently applied. The Corporate Guarantor represents
and warrants that (i) the 10-K statement for the 2003 fiscal year and (ii) the
10-Q statement for the fiscal quarter ended March 29, 2004 fairly present the
financial condition of the Corporate Guarantor as at such dates, all in
accordance with GAAP consistently applied. The Corporate Guarantor represents
and warrants that the management prepared break-down of results for each
individual restaurant operated by the Corporate Guarantor and each of its
Subsidiaries for the period ended March 29, 2004, a copy of which have been
furnished to the Lender, is true and complete in all material respects as at
such date. Since the dates of such statements, there has been no Material
Adverse Change.
(b) Reporting Requirements. So long as any Advance shall remain
unpaid or the Lender shall have any Commitment hereunder, the Borrower and the
Corporate Guarantor (as applicable) will furnish to the Lender:
(i) For the Corporate Guarantor: as soon as available and
in any event within 45 days after the end of each quarter of each fiscal year of
the Corporate Guarantor, consolidated management prepared (10-Q) financial
statements of the Corporate Guarantor and its Subsidiaries as of the end of such
quarter, duly certified by the chief financial officer the Corporate Guarantor
as having been prepared in accordance with GAAP, together with a certificate of
the chief financial officer of the Corporate Guarantor setting forth in
reasonable detail the calculations necessary to demonstrate compliance with the
Covenants Agreement;
(ii) For the Borrower and the Corporate Guarantor: as soon
as available and in any event within 45 days after the end of each quarter of
each fiscal year of the Borrower, management prepared financial statements of
the Borrower as of the end of such quarter, duly certified by the sole or
managing member of the Borrower as having been prepared in accordance with GAAP,
together with a certificate of the sole or managing member of the Borrower
setting forth in reasonable detail the calculations necessary to demonstrate
compliance with the Covenants Agreement;
(iii) For the Corporate Guarantor: as soon as available
and in any event within 90 days after the end of each fiscal year of the
Corporate Guarantor, a copy of the annual audited financial statements for such
year for the Corporate Guarantor and its Subsidiaries (including the Borrower)
containing a consolidated balance sheet of the Corporate Guarantor and
Schedule II-Page 1
its Subsidiaries as of the end of such fiscal year and a consolidated statement
of income and cash flows of the Corporate Guarantor and its Subsidiaries for
such fiscal year, in each case accompanied by an opinion acceptable to the
Lender and an accountant letter, if issued, by independent public accountants
acceptable to the Lender, together with a certificate of the chief certified
financial officer of the Corporate Guarantor setting forth in reasonable detail
the calculations necessary to demonstrate compliance with the Covenants
Agreement;
(iv) For the Borrower as soon as available and in any
event within 90 days after the end of each fiscal year of the Borrower, a copy
of the annual reviewed financial statements for such year for the Borrower,
containing a balance sheet of the Borrower as of the end of such fiscal year and
a statement of income and cash flows of the Borrower for such fiscal year, in
each case accompanied by an opinion acceptable to the Lender and an accountant
letter, if issued, by independent certified public accountants acceptable to the
Lender, together with a certificate of the sole or managing member of the
Borrower setting forth in reasonable detail the calculations necessary to
demonstrate compliance with the Covenants Agreement;
(v) For the Borrower, not later than 90 days after the end
of each fiscal year of the Borrower, a detailed rent roll for the Trust Property
in form satisfactory to the Lender;
(vi) As soon as possible and in any event within five days
after the occurrence of each Default continuing on the date of such statement, a
statement of the sole or managing member of the Borrower or the chief financial
officer of the Corporate Guarantor setting forth details of such Default and the
action that the defaulting party has taken and proposes to take with respect
thereto;
(vii) together with the filing of each 10-K and 10-Q
statement with the Securities and Exchange Commission, a management prepared
break-down of results for each individual restaurant operated by the Corporate
Guarantor or any of its Subsidiaries, duly certified by the chief financial
officer of the Corporate Guarantor as being true and complete; and
(viii) such other information respecting the Borrower or
the Guarantors or any of the Corporate Guarantor's Subsidiaries as the Lender
may from time to time reasonably request.
(c) Liens, Etc. So long as any Advance shall remain unpaid or the
Lender shall have any Commitment hereunder, the Borrower will not create or
suffer to exist, any Lien on or with respect to any of its properties, whether
now owned or hereafter acquired, or assign any right to receive income, other
than: (i) Liens created or expressly permitted under the Loan Documents, (ii)
purchase money Liens upon or in any real property or equipment acquired (or
leased) or held by the Borrower in the ordinary course of business to secure the
purchase price of such property or equipment or to secure Debt incurred solely
for the purpose of financing the acquisition (or lease) of such property or
equipment, or Liens existing on such property or equipment at the time of its
acquisition or extensions, renewals or replacements of any of the foregoing for
the same or a lesser amount, provided, however, that no such Lien shall extend
to or cover any properties of any character other than the real property or
equipment being
Schedule II-Page 2
acquired, and no such extension, renewal or replacement shall extend to or cover
any properties not theretofore subject to the Lien being extended, renewed or
replaced, provided further that the aggregate principal amount of the
indebtedness secured by the Liens referred to in this clause (ii) shall not
exceed the amount specified therefor in Paragraph (d) of this Schedule II at any
time outstanding, (iii) the Liens existing on the Effective Date and described
on Schedule 5.02(a) hereto and (iv) Liens held by the Lender.
(d) Debt. So long as any Advance shall remain unpaid, the
Borrower will not create, incur, assume or suffer to exist, any Debt other than:
(i) Debt existing on the Effective Date and described on Schedule 5.02(c)
hereto, (ii) Debt secured by Liens permitted by Paragraph (c)(ii) of this
Schedule II aggregating not more than $100,000.00 at any one time outstanding,
(iii) Debt under the Loan Documents, (iv) unsecured Debt incurred in the
ordinary course of business aggregating not more than $200,000.00 at any one
time outstanding and (v) Debt owing to the Lender.
(e) Lease Obligations. So long as any Advance shall remain
unpaid, the Borrower will not create, incur, assume or suffer to exist, any
obligations as lessee (i) for the rental or hire of real or personal property in
connection with any sale and leaseback transaction, or (ii) otherwise, except
for the Subject Lease and equipment leases made in the ordinary course of
business, for the rental or hire of other real or personal property of any kind
under leases or agreements to lease having an original term of one year or more.
Schedule II-Page 3
SCHEDULE 4.01(k)
TO LINE OF CREDIT AGREEMENT WITH
S&W OF LAS VEGAS, L.L.C.,
THE ▇▇▇▇▇ & WOLLENSKY RESTAURANT GROUP, INC. AND
▇▇▇▇▇ & WOLLENSKY OF BOSTON LLC
SUBSIDIARIES/AFFILIATES
Atlantic & Pacific Grill Associates, L.L.C.
La Cite Associates, L.L.C.
Manhattan Ocean Club Associates L.L.C.
MOC D.C., L.L.C.
MOC of Miami, LLC
▇▇▇. ▇▇▇▇▇ Sub, L.L.C.
New York RGI Sub, L.L.C.
Parade 59 Restaurant
Restaurant Group Management Services, L.L.C.
▇▇▇▇▇ & Wollensky of Boston LLC
S&W of Chicago, L.L.C.
S&W D.C., L.L.C.
S&W of Miami, L.L.C.
S&W of Las Vegas, L.L.C.
S&W of New Orleans, L.L.C.
S&W of Philadelphia, L.L.C.
S&W of Ohio, L.L.C.
S&W of Dallas, LLC
▇▇▇▇▇ & Wollensky of Houston, LLC
▇▇▇▇▇ & Wollensky of America, LLC
Schedule 4.01(g)-Page 1
▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇ ▇▇▇▇▇▇ Hospitality, Inc.
Schedule 4.01(g)-Page 2
SCHEDULE 5.02(a)
TO LINE OF CREDIT AGREEMENT WITH
S&W OF LAS VEGAS, L.L.C.,
THE ▇▇▇▇▇ & WOLLENSKY RESTAURANT GROUP, INC. AND
▇▇▇▇▇ & WOLLENSKY OF BOSTON LLC
EXISTING LIENS
None.
Schedule 5.02(a)-Page 1
SCHEDULE 5.02(c)
TO LINE OF CREDIT AGREEMENT WITH
S&W OF LAS VEGAS, L.L.C.,
THE ▇▇▇▇▇ & WOLLENSKY RESTAURANT GROUP, INC. AND
▇▇▇▇▇ & WOLLENSKY OF BOSTON LLC
EXISTING DEBT
None.
Schedule 5.02(c)-Page 1
