EXHIBIT 10(nn)
AMENDMENT NUMBER SIX TO
LOAN AND SECURITY AGREEMENT
This AMENDMENT NUMBER SIX TO LOAN AND SECURITY AGREEMENT (this
"Amendment") is entered into as of February 26th, 1999, among Foothill Capital
Corporation, a California corporation ("Foothill"), on the one hand, and FRI-MRD
Corporation, a Delaware corporation ("FRI-MRD"), El Torito Restaurants, Inc., a
Delaware corporation ("El Torito"), and Chi-Chi's, Inc., a Delaware corporation
("Chi-Chi's"), on the other hand, with reference to the following facts:
A. Foothill, on the one hand, and El Torito, Chi-Chi's, FRI-MRD, and
certain of their Affiliates, on the other hand, heretofore have
entered into that certain Loan and Security Agreement, dated as of
January 10, 1997, (as heretofore amended, supplemented, or otherwise
modified, the "Agreement");
B. El Torito and Chi-Chi's (individually and collectively, jointly
and severally, "Borrower") and FRI-MRD have requested that Foothill
waive any Default under Section 7.4 of the Agreement resulting from
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the failure of Borrower to notify Foothill of the acquisition of 2
parcels of real property, Unit No. ET 233 located at 0000 Xxxx Xxxxxx
"X", Xxxxxxxx, XX, and Unit No. ET 245 located at 0000 Xxxxxxx Xxxxx,
Xxxxxxx Xxxx, XX (collectively, the "Additional ET Properties"), the
Additional ET Properties having been acquired for the purpose of the
construction and sale-leaseback of El Torito restaurants, and that
Foothill amend the Agreement to: (i) to increase the amount of
Indebtedness permitted under Section 7.1 of the Agreement with respect
to capital leases and purchase money financings for Equipment from
$5,000,000 to $10,000,000, (ii) to permit additional Indebtedness in
the amount of $1,800,000 representing L/C support for a new food
distribution contract with SYSCO Foods through an amendment to
Schedule 7.1, (iii) to permit further additional indebtedness in the
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original principal amount of $1,600,000 payable by Xxx Xxx Roo Florida
102 J, Limited, a Florida limited partnership, and Xxx Xxx Roo Florida
103 J, Limited, a Florida limited partnership, to City National Bank
of Florida and guaranteed by KKR through a further amendment to
Schedule 7.1, and the grant of Liens by Xxx Xxx Roo Florida 102 J,
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Limited and Xxx Xxx Roo Florida 103 J, Limited to secure such
additional Indebtedness through an amendment to Schedule P-1, and (iv)
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permit the sale-lease-back of certain properties owned by KKR and HGI
through an amendment to Schedule P-2;
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C. Foothill is willing to waive such Default under Section 7.4 of the
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Agreement and to so modify the Agreement in accordance with the terms
and conditions hereof; and
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D. All capitalized terms used herein and not defined herein shall
have the meanings ascribed to them in the Agreement, as amended
hereby.
NOW, THEREFORE, in consideration of the above recitals and the mutual
premises contained herein, Foothill, Borrower and FRI-MRD hereby agree as
follows:
1. Definitions for this Amendment.
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Any and all initially capitalized terms used herein shall have the
meanings ascribed thereto in the Agreement, as amended hereby. For purposes of
this Fourth Amendment only, the following initially capitalized terms shall have
the following meanings:
"Additional ET Properties" has the meaning set forth in Recital B
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hereof.
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2. Amendments to the Agreement.
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a. The definition of "Permitted Liens" contained in Section 1.1
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of the Agreement is amended and restated in its entirety to
read as follows:
"Permitted Liens" means: (a) Liens granted to Foothill or any
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assignee under the Loan Documents, (b) Liens for unpaid taxes, assessments,
and government charges that either (i) are not yet due and payable or (ii)
are the subject of Permitted Protests, (c) Liens set forth on Amended and
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Restated Schedule P-1, (d)(i) the interests of lessors or lessees under
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operating leases and subleases, or (ii) the interests of licensees or
franchisees under licenses or franchises of Borrower Intellectual Property
to the extent constituting an Ordinary Course Disposition under clause (e)
of the definition of Ordinary Course Disposition, (e)(i) Liens securing
purchase money Indebtedness or capital leases permitted under Section
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7.1(g), so long as the Lien only attaches to the asset purchased or
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acquired, or (ii) Acquisition Liens, (f) Liens arising by operation of law,
incurred in the ordinary course of business of FRI-MRD and its Subsidiaries
and not in connection with the borrowing of money, and which Liens either
(i) are for sums not yet due and payable, (ii) are the subject of Permitted
Protests, or (iii) in the aggregate are de minimis in amount, (g) Liens
arising from deposits made in connection with obtaining worker's
compensation or other unemployment insurance, (h) Liens or deposits to
secure performance of bids, tenders, contracts or leases (to the extent
permitted under this Agreement), incurred in the ordinary course of
business of FRI-MRD and its Subsidiaries and not in connection with the
borrowing of money, (i) Liens arising by reason of security for surety or
appeal bonds, (j) Liens of or resulting from any judgment or award that
does not constitute an Event of Default hereunder, (k) Liens with respect
to the Real Property Collateral, and the Anaheim Property, that are
exceptions to the commitments for title insurance issued in connection with
the Mortgages, and the Anaheim Mortgage as accepted by Foothill at the time
of such issuance, (l) with respect to any Real Property, easements, rights
of way, zoning and similar covenants and restrictions, and similar
encumbrances that do not materially interfere with or impair the use or
operation thereof by FRI-MRD or its Subsidiaries, (m) other Liens imposed
by operation of law that do not
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materially affect FRI-MRD's or its Subsidiaries ability to perform their
respective obligations under the Loan Documents, (n) replacement or
continued Liens granted to a Person who provides refinancing or
continuation of Indebtedness pursuant to Section 7.1(h) hereof;
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provided, that the replacement or continued Lien is limited to all or
part of the properties or assets that secured the refinanced or continued
Indebtedness, and (o) the pledge of the Pledged HGI Collateral pursuant to
the Senior Secured Discount Note Agreement.
b. The definition of "Permitted Sale and Lease-backs" contained in
Section 1.1 of the Agreement is amended by deleting clause (b) thereof in its
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entirety and inserting the following in replacement thereof:
"(b) in respect of Chi-Chi's restaurant located in Greenfield,
Wisconsin, the 5 existing El Torito restaurants identified on Schedule P-2,
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and the properties of HGI and KKR identified on Schedule P-2."
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c. Section 7.1(b) of the Agreement is amended and restated in
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its entirety as follows:
(b) Indebtedness as set forth on the Third Amended and Restated
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Schedule 7.1;
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d. Section 7.1(g) of the Agreement hereby is amended and
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restated in its entirety to read as follows:
(g) (i) Indebtedness in respect of capital leases or purchase
money financings for Equipment so long as the acquisition of the subject
asset or assets is not prohibited by Section 7.21 hereof and so long as the
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aggregate principal amount of such Indebtedness outstanding at any one time
does not exceed $10,000,000; and (ii) Indebtedness in respect of capital
leases or purchase money financings for Real Property (and the related
improvements thereto) acquired after the Closing Date; and
e. Schedule 7.1 of the Agreement hereby is amended, restated,
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and replaced in its entirety by the Third Amended and
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Restated Schedule 7.1 attached hereto.
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f. Schedule P-1 of the Agreement hereby is amended, restated,
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and replaced in its entirety by the Amended and Restated
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Schedule P-1 attached hereto.
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g. Schedule P-2 of the Amendment hereby is amended, restated,
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and replaced in its entirety by the Amended and Restated P-2
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attached hereto.
3. Waiver of Event of Default. Foothill hereby waives any Default or
Event of Default resulting from the failure of Borrower to notify Foothill of
the acquisition of the Additional ET Properties (the "Designated Event of
Default"). Such waiver is specific in time and in intent and does not
constitute, nor should it be construed as constituting, except to the extent
expressly set forth herein, a waiver or modification of any term of, or right,
power, or privilege under, the Agreement, the other Loan Documents, or any
agreement, contract, indenture, documents, or instrument mentioned therein.
Nothing herein constitutes a waiver of any Event of Default, or any potential
Event of Default related or preliminary thereto, based on facts or occurrences
other than those on which the Designated Event of Default specifically were
premised. Such waiver does not preclude any exercise or further exercise of any
other right, power, or privilege under any Loan Document, including without
limitation, the taking of any action or remedy based upon an Event of Default
other than the Designated Event of Default.
4. Conditions Precedent to the Effectiveness of this Amendment.
The effectiveness of this Amendment is subject to the fulfillment, to
the satisfaction of Foothill and its counsel, of each of the following
conditions:
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a. Foothill shall have received each of the following
documents, in form and substance satisfactory to Foothill
and its counsel, duly executed, and each such document shall
be in full force and effect:
(1) this Amendment;
(2) the Reaffirmation and Consent (as hereinafter defined);
(3) the Third Amended and Restated Schedule 7.1 to the
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Agreement;
(5) the Amended and Restated Schedule P-1 to the Agreement;
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and
(6) the Amended and Restated Schedule P-2 to the Agreement.
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b. Foothill shall have received an amendment fee of $15,000,
which fee is earned in full by Foothill, due and payable by
Borrower to Foothill on the date hereof, and non-refundable
when paid;
c. The representations and warranties in Section 5 of this
Amendment, the Agreement as amended by Section 2 of this
Amendment, and the other Loan Documents shall be true and
correct in all material respects on and as of the date
hereof, as though made on such date (except to the extent
that such representations and warranties relate solely to an
earlier date);
d. After giving effect hereto, no Event of Default or event
which with the giving of notice or passage of time would
constitute an Event of Default shall have occurred and be
continuing on the date hereof, nor shall result from the
consummation of the transactions contemplated herein;
e. No injunction, writ, restraining order, or other order of
any nature prohibiting, directly or indirectly, the
consummation of the transactions contemplated herein shall
have been issued and remain in force by any governmental
authority against Borrower, FRI-MRD, any Guarantor,
Foothill, or any of their Affiliates;
f. No material adverse change shall have occurred in the
financial condition of Borrower, FRI-MRD, any Guarantor, or
in the value of the Collateral; and
g. All other documents and legal matters in connection with the
transactions contemplated by this Amendment shall have been
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delivered or executed or recorded and shall be in form and
substance reasonably satisfactory to Foothill and its
counsel.
5. Representations and Warranties. Each Borrower party hereto and
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FRI-MRD hereby represents and warrants to Foothill that: (a) the execution,
delivery, and performance of this Amendment and of the Agreement, as amended by
this Amendment, are within its corporate powers, have been duly authorized by
all necessary corporate action, and are not in contravention of any law, rule,
or regulation, or any order, judgment, decree, writ, injunction, or award of any
arbitrator, court, or governmental authority, or of the terms of its charter or
bylaws, or of any contract or undertaking to which it is a party or by which any
of its properties may be bound or affected; and (b) this Amendment and the
Agreement, as amended by this Amendment, constitute each Borrower party hereto
and FRI-MRD's legal, valid, and binding obligation, enforceable against each
Borrower party hereto and FRI-MRD in accordance with their terms.
6. Reaffirmation and Consent. Concurrently herewith, FRI-MRD and
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Borrower shall cause each current Guarantor to execute and deliver to Foothill
the Reaffirmation and Consent attached hereto as Exhibit A (the "Reaffirmation
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and Consent").
7. Choice of Law and Venue; Jury Trial Waiver. Section 13 of the
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Loan Agreement is incorporated herein by this reference as though fully set
forth herein.
8. Miscellaneous.
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a. Upon the effectiveness of this Amendment, each reference in
the Agreement to "this Agreement", "hereunder", "herein",
"hereof" or words of like import referring to the Agreement
shall mean and refer to the Agreement as amended by this
Amendment.
b. Upon the effectiveness of this Amendment, each reference in
the Loan Documents to the "Agreement", "thereunder",
"therein", "thereof" or words of like import referring to
the Agreement shall mean and refer to the Agreement as
amended by this Amendment.
c. This Amendment may be executed in any number of
counterparts, all of which taken together shall constitute
one and the same instrument and any of the parties hereto
may execute this Amendment by signing any such counterpart.
Delivery of an executed counterpart of this Amendment by
telefacsimile shall be equally as effective as delivery of a
manually executed counterpart of this Amendment. Any party
delivering an executed counterpart of this Amendment by
telefacsimile also shall deliver a manually executed
counterpart of this Amendment but the failure to deliver a
manually executed counterpart shall not affect the validity,
enforceability, and binding effect of this Amendment.
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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to
be executed as of the date first written above.
FRI-MRD CORPORATION,
a Delaware corporation
By
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Title:
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EL TORITO RESTAURANTS, INC.,
a Delaware corporation
By
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Title:
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CHI-CHI'S INC.,
a Delaware corporation
By
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Title:
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FOOTHILL CAPITAL CORPORATION,
a California corporation
By
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Title:
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EXHIBIT A
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Reaffirmation and Consent
All capitalized terms used herein but not otherwise defined herein
shall have the meanings ascribed to them in that certain Amendment Number Six to
Loan and Security Agreement, dated as of February 26th, 1999 (the "Amendment").
Each of the undersigned hereby (a) represents and warrants to Foothill that the
execution, delivery, and performance of this Reaffirmation and Consent are
within its corporate powers, have been duly authorized by all necessary
corporate action, and are not in contravention of any law, rule, or regulation,
or any order, judgment, decree, writ, injunction, or award of any arbitrator,
court, or governmental authority, or of the terms of its charter or bylaws, or
of any contract or undertaking to which it is a party or by which any of its
properties may be bound or affected; (b) consents to the amendment of the
Agreement by the Amendment; (c) acknowledges and reaffirms its obligations owing
to Foothill under the Guaranty and any other Loan Documents to which it is
party; and (d) agrees that each of the Guaranty and any other Loan Documents to
which it is a party is and shall remain in full force and effect. Although each
of the undersigned has been informed of the matters set forth herein and has
acknowledged and agreed to same, it understands that Foothill has no obligation
to inform it of such matters in the future or to seek its acknowledgement or
agreement to future amendments, and nothing herein shall create such a duty.
This Reaffirmation and Consent may be executed in any number of counterparts and
by different parties on separate counterparts, each of which, when executed and
delivered, shall be deemed to be an original, and all of which, when taken
together, shall constitute but one and the same Reaffirmation and Consent.
Delivery of an executed counterpart of this Reaffirmation and Consent by
telefacsimile shall be equally as effective as delivery of an original executed
counterpart of this Reaffirmation and Consent. Any party delivering an executed
counterpart of this Reaffirmation and Consent by telefacsimile also shall
deliver an original executed counterpart of this Reaffirmation and Consent but
the failure to deliver an original executed counterpart shall not affect the
validity, enforceability, and binding effect of this Reaffirmation and Consent.
This Reaffirmation and Consent shall be governed by internal laws of the State
of California as more fully set forth in Section 13 of the Loan Agreement.
FAMILY RESTAURANTS, INC.,
a Delaware corporation
FRI-MRD CORPORATION,
a Delaware corporation
FRI-ADMIN CORPORATION,
a Delaware corporation
EL TORITO FRANCHISING COMPANY,
a Delaware corporation
CCMR OF TIMONIUM, INC.,
a Delaware corporation
CCMR OF MARYLAND, INC.,
a Delaware corporation
CHI-CHI'S OF KANSAS, INC.,
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a Kansas corporation
CHI-CHI'S OF GREENBELT, INC.,
a Kentucky corporation
CHI-CHI'S FRANCHISE OPERATIONS CORPORATION,
a Kentucky corporation
CCMR OF CATONSVILLE, INC.,
a Kentucky corporation
CCMR OF GREENBELT, INC.,
a Kentucky corporation
CCMR OF XXXXXXX HIGHWAY, INC.,
a Kentucky corporation
CHI-CHI'S MANAGEMENT CORPORATION,
a Kentucky corporation
CCMR OF HARFORD COUNTY, INC.,
a Kentucky corporation
CHI-CHI'S OF SOUTH CAROLINA, INC.,
a Kentucky corporation
MAINTENANCE SUPPORT GROUP, INC.,
a Kentucky corporation
CCMR OF XXXXXXXXX, INC.,
a Kentucky corporation
CCMR OF INNER HARBOR, INC.,
a Kentucky corporation
CHI-CHI'S OF WEST VIRGINIA, INC.,
a Kentucky corporation
CCMR ADVERTISING AGENCY, INC.,
a Kentucky corporation
CCMR OF GOLDEN RING, INC.,
a Kentucky corporation
XXX XXX ROO, INC.,
a Delaware corporation
THE HAMLET GROUP, INC.,
a California corporation
By _____________________________
Title: ___________________________
CCMR OF CUMBERLAND, INC.,
a Kentucky corporation
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By _____________________________
Title: Authorized Signatory
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THIRD AMENDED AND RESTATED SCHEDULE 7.1
Indebtedness
Add the following to existing Schedule 7.1:
Indebtedness of Xxx Xxx Roo Florida 102J, Limited and Xxx Xxx Roo Florida 103J,
Limited in an aggregate principal amount of $1,600,000 and guarantees thereof by
XXX.
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AMENDED AND RESTATED SCHEDULE P-1
Permitted Liens
Add to existing P-1:
Liens on leasehold interests of Xxx Xxx Roo Florida 102J, Limited and Xxx Xxx
Roo Florida 103J, Limited and Liens and other personal real property of Xxx Xxx
Roo Florida 102J, Limited and Xxx Xxx Roo Florida 103J, Limited related to such
leasehold interests.
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AMENDED AND RESTATED SCHEDULE P-2
Permitted Sale and Lease-backs of Existing Restaurants
Add to existing P-2:
Property of KKR located at or adjacent to 000 Xxxxx Xxxxxxx Xxxxx, Xxxxxxx
Xxxxx, XX 00000
Property of HGI located at or adjacent to (i) 000 Xxxxx Xxxxxxx Xxxxx, Xxxxxxx
Xxxxx, XX 00000 and (ii) 0000 Xxx Xxxx Xxxx., Xxxxxxx Xxxx, XX 00000.
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