EXHIBIT 10(t)
AMENDMENT NO. 1 TO
FIFTH AMENDED AND RESTATED REVOLVING CREDIT AGREEMENT
DATED AS OF SEPTEMBER 22, 2003
THIS AMENDMENT XX. 0 ("Xxxxxxxxx Xx. 0") dated as of December 31, 2003
between MAX & ERMA'S RESTAURANTS, INC., a Delaware corporation (the "Company"),
and THE PROVIDENT BANK, an Ohio banking corporation (the "Bank").
WITNESSETH:
WHEREAS, the Company and the Bank, parties to the Fifth Amended and
Restated Revolving Credit Agreement, dated as of September 22, 2003 (the
"Agreement"), have agreed to amend the Agreement by this Amendment No. 1 on the
terms and conditions hereinafter set forth. Terms not otherwise defined herein
are used as defined in the Agreement as amended hereby.
NOW, THEREFORE, the Company and the Bank hereby agree as follows:
Section 1. Amendment of the Agreement. The Agreement is, effective the
date hereof, hereby amended as follows:
1.1. Section 1.4 (b) is amended and restated in its entirety as follows:
(b) Interest. Each Loan shall bear interest on the unpaid
principal balance of all Loans made by the Bank for each day from the
day such Loan is made until it becomes due, at a fluctuating rate per
annum which rate will be immediately adjusted upon the execution of
this Amendment. Thereafter such rate will be adjusted based upon the
Company's submission of financial information pursuant to Section 5.2
herein beginning with the quarter ending November, 1999. The interest
rate adjustment will be effective the first Monday following receipt
by the Bank of the Quarterly Compliance Certificate pursuant to
Section 5.4(c) herein. The interest rate will be established
according to the following schedule based upon the ratio of the
Indebtedness of the Company to EBITDA of the Company during the
immediately preceding twelve month period as of the date of each
fiscal quarter end:
Ratio at quarter end Rate for following quarter
-------------------- ------------------------------
Less than Either the Prime Rate minus 25
2.0:1.0 basis points or the LIBOR Rate
plus 250 basis points
2.01 through Either the Prime Rate plus 25
2.5:1.0 basis points or the LIBOR Rate
plus 300 basis points
Greater than Either the Prime Rate plus 75
2.51:1.0 basis points or the LIBOR Rate
plus 350 basis points
1
;provided, however, that the interest rate will be Either the Prime
Rate plus 75 basis points or the LIBOR Rate plus 350 basis points
until the Company achieves a Fixed Charge Coverage Ratio of 1.25 to
1.0 as further described in Section 6.2(c).
Interest on all Loans shall be calculated on the basis of the actual
number of days elapsed over a year of 360 days. As used in this
Agreement, the term "Prime Rate" on any day shall mean the rate
published or announced by the Bank as its prime rate which rate may
not be the Bank's lowest rate. Any change in the interest rate on a
Loan due to a change in the Prime Rate shall take effect on the date
of such change in the Prime Rate. "LIBOR Rate" shall mean the
offered rate for U.S. Dollar deposits of not less than $1,000,000.00
for a period of time equal to each Interest Period as of 11:00 A.M.
City of London, England time two London Business Days prior to the
first date of each Interest Period of the Notes as shown on the
display designated as "British Bankers Assoc. Interest Settlement
Rates" on the Telerate System ("Telerate"), Page 3750 or Page 3740,
or such other page or pages as may replace such pages on Telerate
for the purpose of displaying such rate; provided, however, that if
such rate is not available on Telerate then such offered rate shall
be otherwise independently determined by the Bank from an alternate,
substantially similar independent source available to the Bank or
shall be calculated by the Bank by a substantially similar
methodology as that theretofore used to determine such offered rate
in Telerate. "London Business Day" means any day other than a
Saturday, Sunday or a day on which banking institutions are
generally authorized or obligated by law or executive order to close
in the City of London, England. Each change in the rate to be
charged hereunder will become effective without notice on the
commencement of each Interest Period based upon the LIBOR Rate then
in effect. "Interest Period" means each consecutive one, two, three
or six month period (the first of which shall commence on the date
of this Agreement) effective as of the first day of each Interest
Period and ending on the last day of each Interest Period, provided
that if any Interest Period is scheduled to end on a date for which
there is no numerical equivalent to the date on which the Interest
Period commenced, then it shall end instead on the last day of such
calendar month. Under no circumstances will the interest rate on the
Notes be more than the maximum rate allowed by applicable law.
1.2. Section 1.4(d) is amended and restated in its entirety as follows:
(d) Principal. Principal on the Loans shall be due and payable
pursuant to the terms of the Notes and shall be due and payable in
full on the respective Maturity Dates; provided, however, that any
Excess Cash Flow payments the Company makes shall be applied to
principal reduction of the Term Note in the inverse order of
maturity. The Company shall be required to make additional principal
2
payments on the Term Loan based on the annual Net Income of the
Company, commencing for the fiscal year ending in 2003. The Company
shall pay an amount (the "Excess Cash Flow") equal to fifty percent
(50%) of the Company's annual Net Income that exceeds the amount of
principal paid by the Company on the Term Loans during such fiscal
year ; provided, however, that such payment shall never be greater
than $500,000 for any fiscal year. The Company shall pay the Excess
Cash Flow on the February 1 occurring immediately after each fiscal
year end. The Company shall be required to pay any Excess Cash Flow
to the Bank.
1.3. Section 6.2(c) is amended and restated in its entirety as follows:
(c) Fixed Charge Coverage Ratio. Permit the ratio of Fixed Charge
Coverage Ratio at the end of any Fiscal Period (as defined in
Section 9) to be less than (I) 1.10 to 1.0 for the Fiscal Period
ending February 15, 2004, (II) 1.15 to 1.0 for the Fiscal Period
ending May 19, 2004, (III) 1.15 to 1.0 for the Fiscal Period ending
August 1, 2004 and (IV) 1.25 to 1 for each Fiscal Period thereafter
"Fixed Charge Coverage Ratio" means, for the Company during the
Fiscal Period being measured, the quotient of (a) the sum of (i) net
income (adjusted upward to the extent non-recurring, non-cash
charges are reflected therein and adjusted downward to the extent
non-recurring, non-cash gains are reflected therein), plus (ii)
amortization and depreciation plus (iii) accrued interest expense
plus (iv) income taxes payable during such period minus (v) one time
non-cash charges reflected within net income, divided by (b) the sum
of (v) current maturities of other long term indebtedness plus (w)
current maturities of capitalized lease obligations plus (x) accrued
interest expense plus (y) during the Fiscal Period this ratio is
being measured, 20% of the Revolving Credit Usage (as defined
below), and (z) Store Capital Expenditures in the prior 12 months.
"Store Capital Expenditures" means the greater of (A) the product of
(i) the number of Company restaurants that have been open more than
one year during the Fiscal Period this ratio is being measured
multiplied by (ii) $47,000 or (B) the actual Capital Expenditures on
such restaurants during the Fiscal Period. "Revolving Credit Usage"
means the amount of Revolving Loans outstanding under the Revolving
Note on the last day of the Fiscal Period that is being measured.
1.4. Section 6.2(e) is amended and restated in its entirety as follows:
(e) Tangible Net Worth. Permit its Tangible Net Worth to be less
than (i) $7,500,000 from November 1, 2002 through October 31, 2003,
(ii) $10,000,000 from November 1, 2003 through October 31, 2004,
(iii) $11,500,000 from November 1, 2004 through October 31, 2005,
and (iv) $13,000,000 from November 1, 2005 to the later of the
Revolving Credit Maturity Date, the Draw Loan Maturity Date or the
Term Loan Maturity Date.
3
1.5. Section 6.2(f) is amended and restated in its entirety as follows:
(f) Interest Coverage Ratio. As of the end for each Fiscal Period
commencing on February 15, 2004, permit the ratio of (a) (i) the
Company's net income during the Fiscal Period being measured plus
(ii) interest of the Company during the Fiscal Period being measured
plus (iii) taxes of the Company during the Fiscal Period being
measured plus (iv) one time non-cash charges reflected within net
income for the Company during the Fiscal Period being measured to
(b) the Company's interest expense during the Fiscal Period being
measured to be less than 2.25 to 1.0 for each fiscal quarter end.
1.6. Section 6.2(g) is amended and restated in its entirety as follows:
(g) Senior Debt to EBITDA. At the end of any Fiscal Period
commencing on October 31, 2004, permit the ratio of (i) the
Company's Indebtedness during the Fiscal Period being measured to
(ii) the Company's EBITDA during the Fiscal Period being measured to
be greater than 2.5 to 1.0.
1.7. Exhibit C-4 attached hereto amends and restates in its entirety
Exhibit C-3.
Section 2. Governing Law. This Amendment No. 1 shall be governed by and
construed in accordance with the laws of the State of Ohio.
Section 3. Costs and Expenses. The Company hereby agree to pay on demand
all reasonable costs and expenses of the Bank in connection with the
preparation, execution and delivery of this Amendment No. 1 and the other
documents to be delivered in connection herewith, including, without limitation,
the reasonable fees and out-of-pocket expenses of counsel to the Bank with
respect thereto.
Section 4. Counterparts. This Amendment No. 1 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 when taken together shall constitute one and the same agreement.
Section 5. Warrant of Attorney. The undersigned and all indorsers
authorize any attorney at law, including an attorney engaged by the holder, to
appear in any court of record in Columbus, Ohio, after the indebtedness
evidenced hereby, or any part thereof, becomes due and waive the issuance and
service of process and confess judgment against any one or more than one of the
undersigned and all indorsers in favor of the holder, for the amount then
appearing due, together with costs of suit and, thereupon, to release all errors
and waive all rights of appeal and stay of execution, but no such judgment or
judgments against any one of the undersigned shall be a bar to a subsequent
judgment or judgments against any one or more than one of such persons against
whom judgment has not been obtained hereon. The foregoing warrant of attorney
shall survive any judgment; and if any judgment be vacated for any reason, the
holder hereof nevertheless may thereafter use the foregoing warrant of attorney
to obtain an additional
4
judgment or judgments against the undersigned and all indorsers or any one or
more of them. The undersigned and all indorsers hereby expressly waive any
conflict of interest that the holder's attorney may have in confessing such
judgment against such parties and expressly consent to the confessing attorney
receiving a legal fee from the holder for confessing such judgment against such
parties.
Section 6. Conditions Precedent. Simultaneously with the execution hereof,
the Bank shall receive all of the following, each dated the date hereof, in form
and substance satisfactory to the Bank:
6.1. The certificate of an officer of the Company certifying the
resolutions of the board of directors of the Company evidencing authorization of
the execution, delivery, and performance of this Amendment No. 1 and all
documents evidencing other necessary corporate action and governmental
approvals, if any, with respect to the Loan Documents, or the transactions
contemplated.
6.2. Executed versions of Amendment No. 1.
6.3. Payment of a $30,000 amendment fee.
6.4. Such other documents as the Bank may, in its reasonable
discretion, so require.
Section 7. Reaffirmation of Representations and Warranties; No Defaults.
The Company hereby expressly acknowledges and confirms that the representations
and warranties of the Company set forth in Section 4 of the Agreement, as
amended, are true and accurate on this date with the same effect as if made on
and as of this date; that no financial condition or circumstance exists which
would inevitably result in the occurrence of an Event of Default under Section 7
of the Agreement; and that no event has occurred or no condition exists which
constitutes, or with the running of time or the giving of notice would
constitute an Event of Default under Section 7 of the Agreement.
Section 8. Reaffirmation of Documents. Except as herein expressly
modified, the parties hereto ratify and confirm all of the terms, conditions,
warranties and covenants of the Agreement, and all security agreements, pledge
agreements, mortgage deeds, assignments, subordination agreements, or other
instruments or documents executed in connection with the Agreement, including
provisions for the payment of the Notes pursuant to the terms of the Agreement.
The parties hereto agree that this Amendment No. 1 does not constitute the
extinguishment of any obligation or indebtedness previously incurred nor does it
in any manner affect or impair any security interest granted to the Bank, all of
such security interests to be continued in full force and effect until the
indebtedness described herein is fully satisfied.
5
The parties have executed this Amendment No. 1 as of the date first
above written.
WARNING - BY SIGNING THIS PAPER YOU GIVE UP YOUR RIGHT TO NOTICE AND COURT
TRIAL. IF YOU DO NOT PAY ON TIME A COURT JUDGMENT MAY BE TAKEN AGAINST YOU
WITHOUT YOUR PRIOR KNOWLEDGE AND THE POWERS OF A COURT CAN BE USED TO COLLECT
FROM YOU REGARDLESS OF ANY CLAIMS YOU MAY HAVE AGAINST THE CREDITOR WHETHER FOR
RETURNED GOODS, FAULTY GOODS, FAILURE ON HIS PART TO COMPLY WITH THE AGREEMENT,
OR ANY OTHER CAUSE.
MAX & ERMA'S RESTAURANTS, INC. THE PROVIDENT BANK
By: /s/ Xxxxxxx X. Xxxxxxx, Xx. By: /s/ Xxxxxx X. Xxxxx
---------------------------------- ----------------------------
Name: Xxxxxxx X. Xxxxxxx, Xx. Name: Xxxxxx X. Xxxxx
Its: Chief Financial Officer Its: Vice President
Address for Notices: Address for Notices:
0000 Xxxxxxxxx Xxxxx 00 Xxxx Xxxxx Xxxxxx
Xxxxxxxx, XX 00000 Columbus,OH 43215
Attn: Xxxxxxx X. Xxxxxxx, Xx. Attention: Xxxxxx X. Xxxxxxxxx
Telephone No.: 000-000-0000 Telephone No.: 000-000-0000
Telecopy No.: 000-000-0000
6
EXHIBIT C-4
MAX & ERMA'S RESTAURANTS, INC.
AT THE FOLLOWING LOCATIONS:
ADDRESS COUNTY
000 X. Xxxxx Xx., Xxxxxxxx, Xxxx 00000 Franklin
0000 Xxxx Xxxx Xxxxx, Xxxxxxxx, Xxxx 00000 Franklin
0000 Xxxxxxxxxx Xxxxx, Xxxxxx, Xxxx 00000 Xxxxxxxxxx
0000 Xxxxxxxx Xxxx, Xxxxxxxxxxxx, XX 00000 Xxxxxx
0000 Xxxxx Xxxx, Xxxxxxxx, Xxxx 00000 Franklin
00000 Xxxxxxx Xxxx Xxxx, Xxxxxxxxxx Xxxxx, XX 00000 Oakland
0000 X. Xxxxxx-Xxxxxxxxx Xxxx, Xxxxxxxx, Xxxx 00000 Franklin
0000 XX 00 Xxxxx, Xxxxxxxxxxxx, XX 00000 Xxxxxx
000 Xxxxxxx Xx., Xxxxxxxxxx, XX 00000 Allegheny
00000 Xxx Xxxx Xxxx, Xxxxxxx, XX 00000 Xxxxx
000 Xxxxx Xxxxx Xxxxx, Xxxxxx, Xxxx 00000 Franklin
0000 Xxxxxx Xxxxxx, Xxxxxxxxx, XX 00000 Allegheny
0000 Xxxxxxx Xxxx, Xxxxxxxxxx, XX 00000 Allegheny
000 Xxxxxxx Xxxxxx, Xxxxxxxxxx, XX 00000 Oakland
0000 Xxxx 00xx Xxxxxx, Xxxxxxxxxxxx, XX 00000 Xxxxxx
000 Xxxx Xxxxxx Xxxxx, Xxxxxxxx, Xxxx 00000 Franklin
000 X. Xxxxxxxxxx Xxxx., Xxxxx 0, Xxx Xxxxx, XX 00000 Washtenaw
000 Xxxx Xxxx, Xxxxxxxxx Xxxxxxx, XX 00000 Xxxx
0000 X. Xxxxxx Xx., Xxxxxxxx, Xxxx 00000 Summit
00000 Xxxxxxx Xxxx, Xxxxxxxx, Xxxx 00000 Cuyahoga
0000 Xxxxxxxxx Xxxxxxx, Xxxxxxxxxxx, XX 00000 Xxxxxx
000 X. Xxxxxxxxx Xxx., Xxxxxx Xxxxx, XX 00000 Lake
0000 Xxxxxxxxxx Xxxx, Xxxxxxx, Xxxx 00000 Xxxxxxxx
00000 Xxxx Xxxx, #X000, Xxxx, XX 00000 Oakland
0000 00xx Xx., XX, Xxxxx Xxxxxx, XX 00000 Kent
0000 X. 00xx Xxxxxx, Xxxxxxxxx, I11 60517 DuPage
7
ADDRESS COUNTY
0000 Xxxxxxx Xxxx, Xxxxxxx Xxxxxxx, XX 00000 Xxxx
0000 Xxxxxxxx Xxxx, Xxxxxxx, XX 00000 Franklin
0000 X.X. Xxxx Xxxx., Xxxxxxxxx, XX 00000 Mecklenburg
0000 Xxxxxx Xxxx, Xxxxxx, Xxxx 00000 Xxxxxxxxxx
000 Xxxxxxxx Xxxxx, Xxxx, XX 00000 Allegheny
000 X. Xxxxxxxxx Xxxxx, Xxxx Xxxxx, XX 00000 DuPage
00000 Xxxxx Xxxx, Xxxxx, XX 00000 Cuyahoga
0000 Xxxxx Xxxxxx, Xxxxxx, XX 00000 Lake
0000 Xxxxxxxxx Xxxxxx, Xxxxxxxxx, XX 00000 Fayette
000 Xxxxxx Xxxxx, Xxxxxxxxxx, XX 00000 Allegheny
0000 Xxxxxx Xxxxxx Xxxxx, Xxxxxx, XX 00000 Xxxxx
0000 Xx. Xxxxxx Xxxxxxx, Xxxxxxx, XX 00000 Xxxxxx
0000 Xxxxx Xxxxxxxx Xxxx., Xxxxxx, XX 00000 Gwinnett
0000 Xxxxxxx Xxxxxxx, Xxxxxxxx, XX 00000 Franklin
0000 Xxxxxxxx Xxxx, Xxxxxxxx, XX 00000 Franklin
0000 Xxxxxxxxx Xxxxx, Xxxxxx, XX 00000 Xxxxx
00000 Xxxxx Xxxx, Xxxxxxxxxxx, XX 00000 DuPage
0000 Xxxxxxxx Xxx, Xxxxxxxxx, XX 00000 Fayette
0000 Xxxxx Xxxx, Xxxxxxxxxx Xxxxxxx, XX 00000 Cuyahoga
0000 Xxxxxxx Xxxx, Xxxxxxxxxxx, XX 00000 Allegheny
0000 Xxxxxxxxxxx Xxxx, Xxxx XX 00000 Erie
0000 Xxxxxxx Xxxxx, Xxxx Xxxxxxx, XX 00000 Xxxxxx
0000 Xxxxxxxxxx-Xxxxxx Xxxx, Xxxxx, XX 00000 Trumbull
000 Xxxxxxxxxx Xxxxxx #000 (XxxXxxxxx Xxxxxx), Xxxxxxx, XX 00000 Norfolk
00000 Xxxxx Xxxx, Xxxxxxxx Xxxxxxx, XX 00000 Macomb
0000 Xxxxx Xxxxxxxxxxx Xxxxxxx, Xxxxxxxxxx, XX 00000 Jefferson
00000 Xxxxx Xxxxxxxx Xxxxxx, Xxxxxx, XX 00000 Xxxxxx
0000 Xxxxxxx Xxxx, Xxxxxx, XX 00000 Franklin
000 Xxxxx Xxxxx, Xxxxxxxxxx, XX 00000 Allegheny
0000 Xxxxxx Xxxxx Xxxxx, Xxxxxxxx, XX 00000 Jefferson
0000 Xxx Xxxx Xxxx, Xxxxxxxxxxxx, XX 00000 Mecklenburg
8
ADDRESS COUNTY
0000 Xxxxxxxxx Xxxx, Xxxxxxx, XX 00000 Xxxxxxxx
0000 Xxxxxxxxx Xxxxxxx XX, Xxxxxxxxxx, XX 00000 Kent
0000 Xxxxxx Xxxxxxx Xxxxx, Xxxxxxxxxxxx, XX 00000 Xxxxxx
0000 Xxxxxxx Xxxx, Xxxxxx Xxxxx, XX 00000 Oakland
00000 Xxxxx Xxxx Xxxx, Xxxx Xxxx, XX 00000 Lake
000 Xxxxxx Xxxx Xxxxxx, Xxxxxxxx, XX 00000 Franklin
0000 Xxxxxxx Xxxxx Xxxxxxx, Xxxxxxxx, XX 00000 Allegheny
0000 Xxxx Xxxxxxx Xxxx, Xxxxxxx, XX 00000 Xxxxxx
0000 Xxxxxx Xxxxxx, Xxxxxx, XX 00000 Lake
0000 Xxxxxxxxxx Xxxx, XxXxxxxx, XX 00000 Washington
000 Xxxxx Xxxxx Xxxx, Xxxxxxxxx Xxxxx, XX 00000 Oakland
0000 Xxxxxx Xxxxx Xxxxx, Xxxxxxxxxx, XX 00000 Jefferson
0000 Xxxxxxxx Xxxx, Xxxxxxxx, XX 00000 Cuyahoga
000 Xxxxxxxx Xxxxx Xxxxx, Xxxxxxxxxx, XX 00000 Clermont
0000 Xxxx Xxxxx Xxxxxx, Xxxxxxxxxxxx, XX 00000 Franklin
0000 X. Xxxxxxx Xxxxxx, Xxxxxx, XX 00000 Xxxxx
9
