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EXHIBIT 10.40
AMENDMENT NO. 3
TO
THIRD AMENDED AND RESTATED CREDIT AGREEMENT
AND
LIMITED WAIVER
This AMENDMENT NO. 3 TO THIRD AMENDED AND RE-STATED CREDIT AGREEMENT
AND LIMITED WAIVER (this "Amendment") is entered into as of January 29, 2001,
among CKE Restaurants, Inc., the Lenders and BNP Paribas, a bank organized under
the laws of France acting through its Chicago branch (as successor in interest
to Paribas), as Agent.
RECITALS
CKE Restaurants, Inc., a Delaware corporation (the "Borrower"), certain
financial institutions (the "Lenders") and Paribas, as agent for the Lenders (in
such capacity, the "Agent") are parties to that certain Third Amended and
Restated Credit Agreement, dated as of November 24, 1999, as amended by that
certain Amendment No.1 to Third Amended and Restated Credit Agreement, dated as
of April 26, 2000 and that certain Amendment No. 2 to Third Amended and Restated
Credit Agreement and Limited Waiver, dated as of September 28, 2000 (as
hereto-fore amended or otherwise modified, the "Credit Agreement").
The Borrower has requested that the Agent and the Lenders amend and
grant waivers with respect to certain provisions of the Credit Agreement, all as
more fully described herein.
The Agent and the Lenders have agreed to grant such amendments and
waivers upon the terms and conditions set forth herein.
AGREEMENT
NOW, THEREFORE, in consideration of the foregoing and for other good
and valuable consideration, the receipt and adequacy of which are hereby
acknowledged, the parties hereto hereby agree as follows:
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Section 1. Definitions. Capitalized terms used herein and not otherwise defined
herein shall have the respective meanings assigned thereto in the Credit
Agreement, as amended hereby.
Section 2. Amendments to the Credit Agreement. Subject to the terms and
conditions set forth herein, the Credit Agreement is hereby amended as follows:
(a) Section 1.1 of the Credit Agreement is hereby amended by amending
and restating, in its entirety, subsection (c) of the definition of "Applicable
Margin" to read as follows:
(c) Notwithstanding the foregoing, (i) if the Borrower and its
Subsidiaries have not received an aggregate amount of Net Sale Proceeds
of at least $10 million during the period from January 22, 2001 to
February 28, 2001 and used such Net Sale Proceeds to prepay outstanding
Loans and concurrently reduce the Revolving Loan Commitments pro rata
by a corresponding amount, then effective as of 5:00 p.m. (Chicago
time) on February 28, 2001, the Applicable Margin with respect to each
Eurodollar Loan or Base Rate Loan shall be increased by 0.25% until the
earlier of (x) March 31, 2001 or (y) such time as the aggregate amount
of Net Sale Proceeds received after January 22, 2001 shall be at least
$10 million and such Net Sale Proceeds shall have been applied to
prepay outstanding Loans and concurrently reduce the Revolving Loan
Commitments pro rata by a corresponding amount and (ii) if the Borrower
and its Subsidiaries have not received an aggregate amount of Net Sale
Proceeds of at least $25 million during the period from January 22,
2001 to March 31, 2001 and used such Net Sale Proceeds to prepay
outstanding Loans and concurrently reduce the Revolving Loan
Commitments pro rata by a corresponding amount, then effective as of
5:00 p.m. (Chicago time) on March 31, 2001, the Applicable Margin with
respect to each Eurodollar Loan or Base Rate Loan shall be increased by
0.50% until such time as the aggregate amount of Net Sale Proceeds
received after January 22, 2001 shall be at least $25 million and such
Net Sale Proceeds shall have been applied to prepay outstanding Loans
and concurrently reduce the Revolving Loan Commitments pro rata by a
corresponding amount; provided, however, that the maximum aggre-
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gate increase in the Applicable Margin under clauses (i) and (ii) of
this subsection (c) shall be 0.50%.
(b) Section 1.1 of the Credit Agreement is hereby further amended by
inserting the following new definitions in proper alphabetical order:
"Sale-Leaseback Proceeds" has the meaning set forth in Section 2.12(b).
"Taco Bueno" means CBI Restaurants, Inc., a Delaware corporation and
its subsidiaries.
(c) Section 2.3(a) of the Credit Agreement is hereby amended by
amending and restating, in its entirety, the last parenthetical appearing
therein to read as follows:
(provided, that (i) no Eurodollar Loan may be requested or made when
any Default or Event of Default has occurred and is continuing and (ii)
for the period from January 29, 2001 through 5:00 p.m. (Chicago time)
April 30, 2001, no Eurodollar Loan with an Interest Period that would
expire beyond April 30, 2001 may be requested or made)
(d) Section 2.12(b) of the Credit Agreement is hereby amended by
inserting the following sentence immediately at the end of such subsection:
Notwithstanding anything to the contrary in this Section 2.12(b), in
the event that the Borrower or any of its Subsidiaries receives any
Sale-Leaseback Proceeds that would not otherwise be required to be
applied as a prepayment of the Loans under the terms hereof and that
arise from the sale of any Taco Bueno Restaurant or the assets or
business of one or more Restaurants being operated under the Taco Bueno
concept, if the Agent or the Required Lenders shall have notified the
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Borrower in writing (a "Prepayment Notice") that the Borrower has
failed to make satisfactory progress (as determined by the Agent or the
Required Lenders in their sole discretion) to grant, and to cause each
of its Subsidiaries to grant, pursuant to Section 6.13, a valid and
perfected, first priority Lien to the Agent for the benefit of the
Lenders on such portion of the assets and property of the Borrower and
its Subsidiaries as has been determined by the Agent or the Required
Lenders in their sole discretion (which notice shall be given within 5
Business Days, or such later date as agreed to by the Borrower and
notified to the Agent, after the Borrower has delivered notice of its
receipt of such Sale-Leaseback Proceeds as required by Section 6.1(m)),
then the Borrower shall, within one Business Day of receipt of the
Prepayment Notice, prepay the outstanding Loans in an amount equal to
100% of the amount of such Sale-Leaseback Proceeds (or, if a portion of
such Sale-Leaseback Proceeds shall have been used to prepay the Loans
prior to the Borrower's receipt of a Prepayment Notice, 100% of the
balance of such Sale-Leaseback Proceeds) in accordance with the
provisions of Section 2.13 and concurrently reduce the Revolving Loan
Commitments pro rata by a corresponding amount; provided, that,
notwithstanding the second sentence of Section 2.13(a) to the contrary,
such reduction of the Revolving Loan Commitments shall be temporary and
not permanent until such time as the Person or Persons that delivered
the Prepayment Notice shall, in their sole discretion, notify the
Borrower that such progress is satisfactory, at which time any
Revolving Loans prepaid pursuant to this sentence may be reborrowed,
subject to the other terms of this Agreement.
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(e) Section 6.1 of the Credit Agreement is hereby amended by (1)
renumbering subsection (m) thereof to be subsection (n) and (2) inserting a new
subsection (m) to read as follows:
(m) Taco Bueno Sales. Within 5 Business Days of the Borrower or any of
its Subsidiaries receiving any Sale-Leaseback Proceeds from the sale of
any Taco Bueno Restaurant or the assets or business of one or more
Restaurants being operated under the Taco Bueno concept, written notice
thereof specifying the aggregate amount received (it being understood
that upon receipt of such notice the Agent shall promptly notify the
Lenders).
(f) Section 7.1(d) of the Credit Agreement is hereby amended by
amending and restating, in its entirety, such subsection to read as follows:
(d) Minimum Consolidated EBITDA. The Borrower shall not permit
Adjusted Consolidated EBITDA of the Borrower for the period of four
consecutive fiscal quarters (or, commencing on November 7, 2000, the
period of thirteen consecutive Retail Periods) of the Borrower (taken
as one accounting period) as determined on the last day of each fiscal
quarter (or, commencing on November 7, 2000, the last day of each
Retail Period) of the Borrower ending during each period set forth
below, minus the amount of any EBITDA Adjustments as of the date of
determination, to be less than the amount set forth opposite such
period:
Period Amount
Second A&R Closing Date through November 1, 1999 $200,000,000
November 2, 1999 through January 31, 2000 $175,000,000
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Period Amount
February 1, 2000 through May 22, 2000 $155,000,000
May 23, 2000 through August 14, 2000 $160,000,000
August 15, 2000 through November 6, 2000 $133,000,000
November 7, 2000 through January 29, 2001 $110,000,000
January 30, 2001 through February 26, 2001 $105,000,000
February 27, 2001 through March 26, 2001 $105,000,000
March 27, 2001 through April 23, 2001 $100,000,000
April 24, 2001 through May 21, 2001 and
each Retail Period thereafter $ 95,000,000
provided, however, that the amount set forth opposite such period shall
be reduced by the EBITDA Adjustments as of the date of determination
attributable to those Restaurants sold (excluding those sold during the
period from November 2, 1999 through January 31, 2000) pursuant to
which the Net Sale Proceeds from such sales have been applied to
permanently reduce the Commitments of the Lenders on or before the 45
th calendar day following the end of the fiscal quarter in which such
Restaurants were sold.
(g) Section 7.1(f) of the Credit Agreement is hereby amended by (1)
inserting "(a)" immediately before the phrase "if at any time the Unused Portion
of the Revolving Loans" appearing in the last sentence of such subsection, (2)
inserting the word "and" immediately after the parenthetical appearing in the
last sentence of such subsection and (3) inserting the following new clause (b)
immediately before the period at the end of the last sentence of such
subsection:
(b) during the first fiscal quarter of the Borrower's fiscal year 2002,
the Borrower shall not make or incur and shall not permit any of its
Subsidiaries to make or incur any Capital Expenditures in an aggregate
amount in excess of $20,000,000
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Section 3. Limited Waiver. Subject to the terms and conditions set forth herein,
(i) the Agent and the Lenders hereby waive any Default or Event of Default
arising solely as a result of the failure of the Borrower to comply with the
terms of Section 7.1(d) of the Credit Agreement for the period commencing on May
23, 2000 and ending on August 14, 2000 and (ii) for the period commencing on
August 14, 2000 and ending on April 30, 2001, the Agent and the Lenders hereby
waive compliance by the Borrower with the requirements of subsections (a), (b),
(c), (e) and (g) of Section 7.1 of the Credit Agreement; provided, however, that
each of the foregoing waivers shall cease to be effective as of 5:00 p.m.
(Chicago time) on April 30, 2001.
Section 4. Acknowledgment and Agreements. (a) By its execution hereof, the
Borrower acknowledges that it did not receive Net Sale Proceeds in the amounts
and for the periods specified in Section 6.13 of the Credit Agreement and that
as a result, pursuant to Section 6.13 of the Credit Agreement, the Borrower is
required to use its best efforts to, and to cause each of its Subsidiaries to
use its best efforts to, promptly execute and deliver to the Agent such security
agreements, pledge agreements, mortgages, leasehold mortgages and other
agreements, instruments, documents and opinions as the Agent shall request, each
in form and substance satisfactory to the Agent, granting to the Agent, for the
benefit of the Lenders, a valid and perfected, first priority security interest
in such assets and property of the Borrower and such Subsidiaries. The Borrower
hereby agrees to perform its obligations under Section 6.13 of the Credit
Agreement as soon as reasonably practicable.
(b) By its execution hereof, the Borrower further agrees to use
reasonable efforts to effect a complete refinancing of the Loans outstanding
hereunder as soon as reasonably practicable with one or more financial
institutions, pursuant to which the Borrower shall prepay the aggregate
outstanding principal of all Loans, together with accrued and unpaid interest
thereon and all other amounts owing hereunder.
Section 5. Representations and Warranties. The Borrower represents and warrants
to the Agent and the Lenders, as of the date hereof, that after giving effect to
this Amendment:
(a) no Default or Event of Default has occurred and is continuing; and
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(b) all of the representations and warranties of the Borrower and each
other Loan Party contained in the Transaction Documents are true and correct.
Section 6. Conditions to Effectiveness of this Amendment. Upon satisfaction of
the following conditions precedent, this Amendment shall immediately become
effective as of the date hereof:
(a) The Agent shall have received a counterpart to this Amendment, duly
executed and delivered by the Borrower and each of the Required Lenders;
(b) The Agent shall have received a certificate of a duly authorized
officer of the Borrower certifying as to matters set forth in Section 5 of this
Amendment; and
(c) The Agent shall have received a side letter from the Borrower, duly
executed and delivered by the Borrower and relating to the payment of an
amendment fee.
Section 7. Miscellaneous.
(a) Effect; Ratification. The amendments and waivers set forth herein
are effective solely for the purposes set forth herein and shall be limited
precisely as written, and shall not be deemed to (1) be a consent to any
amendment, waiver or modification of any other term or condition of any
Transaction Document or of any other instrument or agreement referred to
therein, except as set forth herein, or (2) prejudice any right or remedy that
the Agent or any Lender may now have or may have in the future under or in
connection with the Credit Agreement, as amended hereby, or any other instrument
or agreement referred to therein. Each reference in the Credit Agreement to
"this Agreement," "herein," "hereof" and words of like import and each reference
in the other Transaction Documents to the "Credit Agreement" shall mean the
Credit Agreement as amended hereby. For the avoidance of doubt, each reference
in the Credit Agreement, as amended hereby to "the date hereof" shall mean and
be a reference to November 24, 1999. This Amendment shall be construed in
connection with and as part of the Credit Agreement and all terms, conditions,
representations, warranties, covenants and agreements set forth in the Credit
Agreement and each other instrument or agreement referred to therein, except
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as herein amended, are hereby ratified and confirmed and shall remain in full
force and effect.
(b) Expenses and Fees. Notwithstanding anything contained in the Credit
Agreement, as amended hereby, or any other Transaction Document and in addition
to any fees and expenses required to be paid by the Borrower thereunder, the
Borrower agrees to pay all costs, fees and expenses incurred by the Agent in
connection with the preparation, execution and delivery of this Amendment
(including the reasonable fees and expenses of counsel to the Agent).
(c) Counterparts. This Amendment may be executed in any number of
counterparts, each such counterpart constituting an original and all of which
when taken together shall constitute one and the same instrument.
(d) Severability. Any provision contained in this Amendment that is
held to be inoperative, unenforceable or invalid in any jurisdiction shall, as
to that jurisdiction, be inoperative, unenforceable or invalid without affecting
the operation, enforceability or validity of the remaining provisions of this
Amendment in that jurisdiction or the operation, enforceability or validity of
such provision in any other jurisdiction.
(e) GOVERNING LAW. THIS AMENDMENT SHALL BE GOVERNED BY, AND CONSTRUED
AND INTERPRETED IN ACCORDANCE WITH, THE INTERNAL LAWS (AND NOT THE LAW OF
CONFLICTS) OF THE STATE OF ILLINOIS.
[SIGNATURE PAGES FOLLOW]
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IN WITNESS WHEREOF, the undersigned have executed this Amendment as of
the date first above written.
CKE RESTAURANTS, INC.
By: _____________________________________
Print Name:
Title:
BNP PARIBAS (as successor in interest to
PARIBAS), as Agent and as a Lender
By: ____________________________________
Print Name: Xxxxx X. Xxxx III
Title: Managing Director
By: ____________________________________
Print Name: Xxxxxxx X. Xxxxxx
Title: Vice President
BANK LEUMI USA
By: _____________________________________
Print Name:
Title:
BANK LEUMI USA
By: ____________________________________
Print Name:
Title:
ARAB BANKING CORPORATION
By: ____________________________________
Print Name:
Title:
By: ____________________________________
Print Name:
Title:
BANK UNITED
By: ____________________________________
Print Name:
Title:
AMENDMENT NO. 3 AND LIMITED WAIVER TO
THIRD AMENDED AND RESTATED CREDIT AGREEMENT
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XXXX XXXXXXX CREDITANSTALT
CORPORATE FINANCE, INC.
By: ____________________________________
Print Name:
Title:
By: ____________________________________
Print Name:
Title:
CALIFORNIA BANK & TRUST
f/k/a SUMITOMO BANK OF CALIFORNIA)
By: ____________________________________
Print Name:
Title:
NATIONAL BANK OF KUWAIT
By: ____________________________________
Print Name:
Title:
By: ____________________________________
Print Name:
Title:
CENTURA BANK
By: ____________________________________
Print Name:
Title:
AMENDMENT NO. 3 AND LIMITED WAIVER TO
THIRD AMENDED AND RESTATED CREDIT AGREEMENT
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00
XXXXX XXX XXXXXXXXXX XXXX, XXX.,
XXX XXXX BRANCH
By: ____________________________________
Print Name:
Title:
AMSOUTH BANK (successor in interest by
merger to FIRST AMERICAN NATIONAL BANK)
By: ____________________________________
Print Name:
Title:
FIRST BANK & TRUST
By: ____________________________________
Print Name:
Title:
CREDIT INDUSTRIEL ET COMMERCIAL
(f/k/a COMPAGNIE FINANCIERE DE CIC
ET DE L'UNION EUROPEENNE)
By: ____________________________________
Print Name:
Title:
FIRST UNION NATIONAL BANK
By: ____________________________________
Print Name:
Title:
FLEET NATIONAL BANK
(f/k/a BANKBOSTON, N.A.)
By: ___________________________________
Print Name:
Title:
AMENDMENT NO. 3 AND LIMITED WAIVER TO
THIRD AMENDED AND RESTATED CREDIT AGREEMENT
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MANUFACTURERS BANK
By: ___________________________________
Print Name:
Title:
SUNTRUST BANK (f/k/a/ SUNTRUST
BANK, NASHVILLE, N.A.)
By: ___________________________________
Print Name:
Title:
U.S. BANK NATIONAL ASSOCIATION
By: ___________________________________
Print Name:
Title:
THE SANWA BANK, LIMITED
By: ____________________________________
Print Name:
Title:
UMB BANK, N.A.
By: ____________________________________
Print Name:
Title:
XXXXX FARGO BANK
By: ____________________________________
Print Name:
Title:
AMENDMENT NO. 3 AND LIMITED WAIVER TO
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OFFICER'S CERTIFICATE
I,__________________, am the _________________ of CKE Restaurants, Inc.
I execute and deliver this Officer's Certificate dated as of January ___, 2001,
on behalf of the Borrower pursuant to Section 6 of the Amendment No. 3 and
Limited Waiver to Third Amended and Restated Credit Agreement (the "Amendment")
by and among CKE Restaurants, Inc. (the "Borrower"), the Lenders party thereto
and Paribas, acting in its capacity as agent for the Lenders (the "Agent").
Capitalized terms used but not defined herein shall the respective meanings
specified in the Amendment.
I hereby certify, on behalf of the Borrower, after giving effect to the
Amendment, that (a) no Default or Event of Default has occurred and is
continuing and (b) all of the representations and warranties of the Borrower and
each other Loan Party contained in the Transaction Documents are true and
correct as of the date hereof.
CKE RESTAURANTS, INC.
By: __________________________________
Name:
Title:
AMENDMENT NO. 3 AND LIMITED WAIVER TO
THIRD AMENDED AND RESTATED CREDIT AGREEMENT
