Exhibit 10.1
CREDIT AGREEMENT
BY AND AMONG
GRILL CONCEPTS, INC.
AS BORROWER,
THE LENDERS THAT ARE SIGNATORIES HERETO
AS THE LENDERS,
AND
DIAMOND CREEK INVESTMENT PARTNERS, LLC
AS THE ARRANGER AND ADMINISTRATIVE AGENT
DATED AS OF MARCH 10, 2006
CREDIT AGREEMENT
THIS CREDIT AGREEMENT (this "Agreement"), is entered into as of March 10,
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2006 by and among the lenders identified on the signature pages hereof (such
lenders, together with their respective successors and permitted assigns, are
referred to hereinafter each individually as a "Lender" and collectively as the
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"Lenders"), DIAMOND CREEK INVESTMENT PARTNERS, LLC, a Delaware limited liability
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company, as the arranger and administrative agent for the Lenders (in such
capacity, together with its successors and assigns in such capacity, "Agent"),
and GRILL CONCEPTS, INC., a Delaware corporation ("Borrower").
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The parties agree as follows:
1. DEFINITIONS AND CONSTRUCTION.
1.1 DEFINITIONS. As used in the Agreement, the following terms shall have
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the following definitions:
"Account" means an account (as that term is defined in the Code).
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"Account Debtor" means any Person who is obligated on an Account, chattel
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paper, or a general intangible.
"Advances" has the meaning specified therefor in Section 2.1(a).
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"Affiliate" means, as applied to any Person, any other Person who controls,
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is controlled by, or is under common control with, such Person. For purposes of
this definition, "control" means the possession, directly or indirectly through
one or more intermediaries, of the power to direct the management and policies
of a Person, whether through the ownership of Stock, by contract, or otherwise;
provided, however, that, for purposes of Section 6.13 of the Agreement: (a) any
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Person which owns directly or indirectly 10% or more of the Stock having
ordinary voting power for the election of directors or other members of the
governing body of a Person or 10% or more of the partnership or other ownership
interests of a Person (other than as a limited partner of such Person) shall be
deemed an Affiliate of such Person, (b) each director (or comparable manager) of
a Person shall be deemed to be an Affiliate of such Person, and (c) each
partnership or joint venture in which a Person is a partner or joint venturer
shall be deemed an Affiliate of such Person.
"Agent" has the meaning specified therefor in the preamble to the
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Agreement.
"Agent-Related Persons" means Agent, together with its Affiliates,
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officers, directors, employees, attorneys, and agents.
"Agent's Account" means the Deposit Account of Agent identified on Schedule
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A-1.
"Agent's Liens" means the Liens granted by Borrower or its Subsidiaries to
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Agent under the Loan Documents.
"Agreement" has the meaning specified therefor in the preamble hereto.
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"Assignee" has the meaning specified therefor in Section 13.1(a).
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"Assignment and Acceptance" means an Assignment and Acceptance Agreement
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substantially in the form of Exhibit A-1.
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"Authorized Person" means the chief executive officer, chief financial
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officer, president, executive vice president, or corporate secretary of the
Borrower.
"Availability" means, as of any date of determination, the amount that
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Borrower is entitled to borrow as Advances under Section 2.1 (after giving
effect to all then outstanding Obligations and all sublimits and reserves then
applicable hereunder).
"Bankruptcy Code" means title 11 of the United States Code, as in effect
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from time to time.
"Base LIBOR Rate" means the rate per annum set forth as the "London
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Interbank Offered Rates Rate" in the "Money Rates" column of The Wall Street
Journal, Western Edition as the rate (rounded upwards, if necessary, to the next
1/100%), 2 Business Days prior to the commencement of the requested Interest
Period, for a term comparable to the Interest Period and the amount of the LIBOR
Rate Loan requested (whether as an initial LIBOR Rate Loan or as a continuation
of a LIBOR Rate Loan or as a conversion of a Base Rate Loan to a LIBOR Rate
Loan) by Borrower in accordance with the Agreement.
"Base Rate" means, as of any date of determination, the greater of (a) the
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rate of interest announced, from time to time, by Bank of America, N.A., or its
successors, as its "prime rate" or "reference rate" (the "prime rate" or
"reference rate" being a rate (which is not necessarily the lowest of such
rates) based upon various factors including such bank's costs and desired
return, general economic conditions and other factors, and is used as a
reference point for pricing some loans, which may be priced at, above, or below
such announced rate) and (b) 7.00%.
"Base Rate Loan" means the portion of the Advances that bears interest at a
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rate determined by reference to the Base Rate.
"Base Rate Margin" means, as of any date of determination, the following
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margin based upon the most recent Leverage Ratio calculation; provided, however,
that (a) for the period from the Closing Date through September 30, 2006, the
Base Rate Margin shall be at the margin in the row styled "Level III", and (b)
at any time that an Event of Default has occurred (until the first day of the
first fiscal quarter following the date on which such Default or Event of
Default is no longer continuing) under Section 7.1 of this Agreement or under of
Section 7.2(a) of this Agreement (with respect to a breach of Section 6.16
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only), the Base Rate Margin shall be at the margin in the row styled "Level IV":
Level Leverage Ratio Base Rate Margin
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I Less than 1.50 to 1.00 2.75 percentage points
II Greater than or equal to 1.50 to 1.00,
but less than 1.75 to 1.00 3.00 percentage points
III Greater than or equal to 1.75 to 1.00
but less than 2.00 to 1.00 3.25 percentage points
IV Greater than or equal to 2.00 to 1.00 3.50 percentage points
Except as set forth in the foregoing proviso, the Base Rate Margin shall be
based upon the most recent calculation of the Leverage Ratio, which will be
calculated as of the end of each fiscal quarter. Except as set forth in the
initial proviso in this definition, the Base Rate Margin shall be re-determined
each fiscal quarter on the first day of the month following the date of delivery
to Agent of the certified calculation of the Leverage Ratio pursuant to Section
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5.3; provided, however, that if Borrower fails to provide such certification
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when such certification is due and such failure continues for 3 Business Days,
the Base Rate Margin shall be set at the margin in the row styled "Level IV" as
of the first day of the month following the date on which the certification was
required to be delivered until the date on which such certification is delivered
(on which date (but not retroactively), without constituting a waiver of any
Default or Event of Default occasioned by the failure to timely deliver such
certification, the Base Rate Margin shall be set at the margin based upon the
Leverage Ratio calculation disclosed by such certification).
"Benefit Plan" means a "defined benefit plan" (as defined in Section 3(35)
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of ERISA) for which Borrower or any Subsidiary or ERISA Affiliate of Borrower
has been an "employer" (as defined in Section 3(5) of ERISA) within the past six
years.
"Board of Directors" means the board of directors (or comparable managers)
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of Borrower or any committee thereof duly authorized to act on behalf of the
board of directors (or comparable managers).
"Borrower" has the meaning specified therefor in the preamble to the
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Agreement.
"Borrowing" means a borrowing hereunder consisting of Advances made on the
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same day by the Lenders (or Agent on behalf thereof), or by Swing Lender in the
case of a Swing Loan, or by Agent in the case of an Protective Advance.
"Borrowing Base" means, as of any date of determination, the result of:
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(a) 2.25 times TTM EBITDA, minus
(c) the aggregate amount of reserves, if any, established by
Agent under Section 2.1(b).
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"Borrowing Base Certificate" means a certificate in the form of Exhibit
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B-1.
"Business Day" means any day that is not a Saturday, Sunday, or other day
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on which banks are authorized or required to close in the state of New York,
except that, if a determination of a Business Day shall relate to a LIBOR Rate
Loan, the term "Business Day" also shall exclude any day on which banks are
closed for dealings in Dollar deposits in the London interbank market.
"Capital Expenditures" means, with respect to any Person for any period,
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the aggregate of all expenditures by such Person and its Subsidiaries during
such period that are capital expenditures as determined in accordance with GAAP,
whether such expenditures are paid in cash or financed.
"Capitalized Lease Obligation" means that portion of the obligations under
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a Capital Lease that is required to be capitalized in accordance with GAAP.
"Capital Lease" means a lease that is required to be capitalized for
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financial reporting purposes in accordance with GAAP.
"Carry-Over Amount" has the meaning specified therefore in Section
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6.16(b)(iii).
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"Cash Equivalents" means (a) marketable direct obligations issued by, or
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unconditionally guaranteed by, the United States or issued by any agency thereof
and backed by the full faith and credit of the United States, in each case
maturing within 1 year from the date of acquisition thereof, (b) marketable
direct obligations issued by any state of the United States or any political
subdivision of any such state or any public instrumentality thereof maturing
within 1 year from the date of acquisition thereof and, at the time of
acquisition, having one of the two highest ratings obtainable from either
Standard & Poor's Rating Group ("S&P") or Xxxxx'x Investors Service, Inc.
("Moody's"), (c) commercial paper maturing no more than 270 days from the date
of creation thereof and, at the time of acquisition, having a rating of at least
A-1 from S&P or at least P-1 from Moody's, (d) certificates of deposit or
bankers' acceptances maturing within 1 year from the date of acquisition thereof
issued by any bank organized under the laws of the United States or any state
thereof having at the date of acquisition thereof combined capital and surplus
of not less than $250,000,000, (e) Deposit Accounts maintained with (i) any bank
that satisfies the criteria described in clause (d) above, or (ii) any other
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bank organized under the laws of the United States or any state thereof so long
as the amount maintained with any such other bank is less than or equal to
$100,000 and is insured by the Federal Deposit Insurance Corporation, and (f)
Investments in money market funds substantially all of whose assets are invested
in the types of assets described in clauses (a) through (e) above.
"Cash Management Account" has the meaning specified therefor in Section
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2.7(a).
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"Cash Management Bank" has the meaning specified therefor in Section
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2.7(a).
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"Change of Control" means that (a) any "person" or "group" (within the
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meaning of Sections 13(d) and 14(d) of the Exchange Act), other than Permitted
Holders, becomes the beneficial owner (as defined in Rule 13d-3 under the
Exchange Act), directly or indirectly, of 25%, or more, of the Stock of Borrower
having the right to vote for the election of members of the Board of Directors,
or (b) a majority of the members of the Board of Directors do not constitute
Continuing Directors.
"Class Action Lawsuit" means that certain lawsuit know as Xxxxx Xxxxxx, on
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behalf of himself and all other similarly situated, and on behalf of the general
public v. Grill Concepts, Inc., a California corporation and Does 1-500, filed
in the Superior Court of the State of California, for the County of Los Angeles
- Central Civil West, Case No. BC 321902, filed June 3, 2004.
"Closing Date" means the date of the making of the initial Advance (or
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other extension of credit) hereunder.
"Code" means the New York Uniform Commercial Code, as in effect from time
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to time.
"Collateral" means all assets and interests in assets and proceeds thereof
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now owned or hereafter acquired by Borrower or its Subsidiaries in or upon which
a Lien is granted under any of the Loan Documents.
"Collateral Access Agreement" means a landlord waiver, bailee letter, or
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acknowledgement agreement of any lessor, warehouseman, processor, consignee, or
other Person in possession of, having a Lien upon, or having rights or interests
in Borrower's or its Subsidiaries' books and records, Equipment, or Inventory,
in each case, in form and substance satisfactory to Agent.
"Collections" means all cash, checks, notes, instruments, and other items
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of payment (including insurance proceeds, proceeds of cash sales, rental
proceeds, and tax refunds).
"Commitment" means, with respect to each Lender, its Revolver Commitment
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and, with respect to all Lenders, their Revolver Commitments, in each case as
such Dollar amounts are set forth beside such Lender's name under the applicable
heading on Schedule C-1 or in the Assignment and Acceptance pursuant to which
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such Lender became a Lender hereunder, as such amounts may be reduced or
increased from time to time pursuant to assignments made in accordance with the
provisions of Section 13.1.
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"Compliance Certificate" means a certificate substantially in the form of
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Exhibit C-1 delivered by the chief financial officer of Borrower to Agent.
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"Continuing Director" means (a) any member of the Board of Directors who
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was a director (or comparable manager) of Borrower on the Closing Date, and (b)
any individual who becomes a member of the Board of Directors after the Closing
Date if such individual was appointed or nominated for election to the Board of
Directors by a majority of the Continuing Directors, but excluding any such
individual originally proposed for election in opposition to the Board of
Directors in office at the Closing Date in an actual or threatened election
contest relating to the election of the directors (or comparable managers) of
Borrower and whose initial assumption of office resulted from such contest or
the settlement thereof.
"Control Agreement" means a control agreement, in form and substance
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satisfactory to Agent, executed and delivered by Borrower or one of its
Subsidiaries, Agent, and the applicable securities intermediary (with respect to
a Securities Account) or bank (with respect to a Deposit Account).
"Daily Balance" means, as of any date of determination and with respect to
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any Obligation, the amount of such Obligation owed at the end of such day.
"Default" means an event, condition, or default that, with the giving of
notice, the passage of time, or both, would be an Event of Default.
"Defaulting Lender" means any Lender that fails to make any Advance (or
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other extension of credit) that it is required to make hereunder on the date
that it is required to do so hereunder.
"Defaulting Lender Rate" means (a) for the first 3 days from and after the
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date the relevant payment is due, the Base Rate, and (b) thereafter, the
interest rate then applicable to Advances that are Base Rate Loans (inclusive of
the Base Rate Margin applicable thereto).
"Deposit Account" means any deposit account (as that term is defined in the
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Code).
"Designated Account" means the Deposit Account of Borrower identified on
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Schedule D-1.
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"Designated Account Bank" has the meaning specified therefor in Schedule
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D-1.
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"Diamond Creek" means Diamond Creek Investment Partners, LLC, a Delaware
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limited liability company.
"Dollars" or "$" means United States dollars.
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"EBITDA" means, with respect to any fiscal period, Borrower's and its
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Subsidiaries' consolidated net earnings (or loss), minus extraordinary gains and
interest income, plus interest expense, income taxes, and depreciation and
amortization for such period, plus, settlement and legal costs and expenses
incurred by Borrower or any of its Subsidiaries in connection with the Class
Action Lawsuit in an aggregate amount not to exceed $1,000,000, in each case, as
determined in accordance with GAAP.
"Eligible Transferee" means (a) a commercial bank organized under the laws
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of the United States, or any state thereof, and having total assets in excess of
$250,000,000, (b) a commercial bank organized under the laws of any other
country which is a member of the Organization for Economic Cooperation and
Development or a political subdivision of any such country and which has total
assets in excess of $250,000,000, provided that such bank is acting through a
branch or agency located in the United States, (c) a finance company, insurance
company, or other financial institution or fund that is engaged in making,
purchasing, or otherwise investing in commercial loans and having (together with
its Affiliates and Related Funds) total assets (including assets under
management) in excess of $250,000,000, (d) any Lender or any Affiliate (other
than individuals) or Related Fund of a Lender, (e) so long as no Event of
Default has occurred and is continuing, any other Person approved by Agent and
Borrower (which approval of Borrower shall not be unreasonably withheld,
delayed, or conditioned), and (f) during the continuation of an Event of
Default, any other Person approved by Agent.
"Environmental Actions" means any complaint, summons, citation, notice,
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directive, order, claim, litigation, investigation, judicial or administrative
proceeding, judgment, letter, or other communication from any Governmental
Authority, or any third party involving violations of Environmental Laws or
releases of Hazardous Materials from (a) any assets, properties, or businesses
of Borrower, its Subsidiaries, or any of their predecessors in interest, (b)
from adjoining properties or businesses, or (c) from or onto any facilities
which received Hazardous Materials generated by Borrower, its Subsidiaries, or
any of their predecessors in interest.
"Environmental Law" means any applicable federal, state, provincial,
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foreign or local statute, law, rule, regulation, ordinance, code, binding and
enforceable guideline, binding and enforceable written policy, or rule of common
law now or hereafter in effect and in each case as amended, or any judicial or
administrative interpretation thereof, including any judicial or administrative
order, consent decree or judgment, in each case, to the extent binding on
Borrower or its Subsidiaries, relating to the environment, the effect of the
environment on employee health, or Hazardous Materials, in each case as amended
from time to time.
"Environmental Liabilities" means all liabilities, monetary obligations,
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losses, damages, punitive damages, consequential damages, treble damages, costs
and expenses (including all reasonable fees, disbursements and expenses of
counsel, experts, or consultants, and costs of investigation and feasibility
studies), fines, penalties, sanctions, and interest incurred as a result of any
claim or demand, or Remedial Action required, by any Governmental Authority or
any third party, and which relate to any Environmental Action.
"Environmental Lien" means any Lien in favor of any Governmental Authority
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for Environmental Liabilities.
"Equipment" means equipment (as that term is defined in the Code).
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"ERISA" means the Employee Retirement Income Security Act of 1974, as
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amended, and any successor statute thereto.
"ERISA Affiliate" means (a) any Person subject to ERISA whose employees are
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treated as employed by the same employer as the employees of Borrower or its
Subsidiaries under IRC Section 414(b), (b) any trade or business subject to
ERISA whose employees are treated as employed by the same employer as the
employees of Borrower or its Subsidiaries under IRC Section 414(c), (c) solely
for purposes of Section 302 of ERISA and Section 412 of the IRC, any
organization subject to ERISA that is a member of an affiliated service group of
which Borrower or any of its Subsidiaries is a member under IRC Section 414(m),
or (d) solely for purposes of Section 302 of ERISA and Section 412 of the IRC,
any Person subject to ERISA that is a party to an arrangement with Borrower or
any of its Subsidiaries and whose employees are aggregated with the employees of
Borrower or its Subsidiaries under IRC Section 414(o).
"Event of Default" has the meaning specified therefor in Section 7.
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"Excess Availability" means, as of any date of determination, the amount
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equal to Availability minus the aggregate amount, if any, of all trade payables
of Borrower and its Subsidiaries aged in excess of historical levels with
respect thereto and all book overdrafts of Borrower and its Subsidiaries in
excess of historical practices with respect thereto, in each case as determined
by Agent in its Permitted Discretion.
"Exchange Act" means the Securities Exchange Act of 1934, as in effect from
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time to time.
"Excluded Taxes" means (a) all taxes imposed on or by reference to the net
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income of the agent or any Lender, including franchise taxes, taxes on doing
business, taxes measured by capital or net worth and branch profits or similar
taxes imposed (i) by the United States or any political subdivision or taxing
authority thereof, (ii) by any other jurisdiction or by any political
subdivision or taxing authority thereof under the laws of which the Agent or
such Lender is organized, has its principal place of business or maintains its
lending office or (iii) by any other jurisdiction or political subdivision or
taxing authority thereof solely as a result of a present or former connection
between Agent or such Lender and such jurisdiction or political subdivision or
taxing authority (other than any such connection arising from the Agent or such
Lender having executed delivered, or performed its obligations or performed its
obligations or received payment under or enforced, any of the Loan Documents)
and (b) all U.S. taxes that are required to be deducted or withheld from any
payment under any of the Loan Documents because of the failure of the Lender to
comply with Section 15.11 (b).
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"Existing Lender" means Union Bank of California, N.A.
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"Existing Letters of Credit" means that certain letter of credit number
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306S235563 issued by the Existing Lender in the face amount of $1,010,000 in
support of certain workers' compensation liabilities of the Borrower and its
Subsidiaries, and any letter of credit issued in replacement thereof.
"Existing Loan Documents" means (i) that certain Small Business Banking
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Agreement, dated May 24, 2004, by and between Borrower and Existing Lender, as
amended from time to time, (ii) that certain Covenant Agreement, dated as of May
24, 2005, between Borrower and Existing Lender, and (iii) all other documents
entered into in connection with the documents described in clauses (i) and (ii)
above.
"Fee Letter" means that certain fee letter between Borrower and Agent, in
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form and substance satisfactory to Agent.
"Four Wall Cash Flow" means, with respect to any fiscal period, Borrower's
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and its Subsidiaries' consolidated net sales plus management and license fees,
less cost of sales and restaurant operating expenses (excluding depreciation and
amortization) for such period, in each case, as determined in accordance with
GAAP.
"Funding Date" means the date on which a Borrowing occurs.
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"Funding Losses" has the meaning specified therefor in Section 2.13(b)(ii).
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"GAAP" means generally accepted accounting principles as in effect from
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time to time in the United States, consistently applied.
"Governing Documents" means, with respect to any Person, the certificate or
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articles of incorporation, by-laws, or other organizational documents of such
Person.
"Governmental Authority" means any federal, state, local, or other
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governmental or administrative body, instrumentality, board, department, or
agency or any court, tribunal, administrative hearing body, arbitration panel,
commission, or other similar dispute-resolving panel or body.
"Growth Capital Expenditures" means Capital Expenditures for acquiring or
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opening new Restaurant locations or in connection with Major Renovations of any
Restaurant; provided, however, that expenditures made to make leasehold
improvements in connection with the acquisition or opening of any new Restaurant
shall not be considered Capital Expenditures to the extent such expenditures are
reimbursed (other than by way of discounts on future rent) by the landlord
within 120 days after the date such expenditures are made.
"Guarantors" means (a) each Subsidiary identified on Schedule G-1 hereto
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and (b) each other Person who guarantees all or any part of the Obligations ,
and "Guarantor" means any one of them.
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"Guaranty" means that certain general continuing guaranty executed and
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delivered by each Guarantor in favor of Agent, for the benefit of the Lender
Group, in form and substance satisfactory to Agent.
"Hazardous Materials" means (a) substances that are defined or listed in,
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or otherwise classified pursuant to, any applicable laws or regulations as
"hazardous substances," "hazardous materials," "hazardous wastes," "toxic
substances," or any other formulation intended to define, list, or classify
substances by reason of deleterious properties such as ignitability,
corrosivity, reactivity, carcinogenicity, reproductive toxicity, or "EP
toxicity", (b) oil, petroleum, or petroleum derived substances, natural gas,
natural gas liquids, synthetic gas, drilling fluids, produced waters, and other
wastes associated with the exploration, development, or production of crude oil,
natural gas, or geothermal resources, (c) any flammable substances or explosives
or any radioactive materials, and (d) asbestos in any form or electrical
equipment that contains any oil or dielectric fluid containing levels of
polychlorinated biphenyls in excess of 50 parts per million.
"Hedge Agreement" means any and all agreements or documents now existing or
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hereafter entered into by Borrower or any of its Subsidiaries that provide for
an interest rate, credit, commodity or equity swap, cap, floor, collar, forward
foreign exchange transaction, currency swap, cross currency rate swap, currency
option, or any combination of, or option with respect to, these or similar
transactions, for the purpose of hedging Borrower's or any of its Subsidiaries'
exposure to fluctuations in interest or exchange rates, loan, credit exchange,
security, or currency valuations or commodity prices.
"Holdout Lender" has the meaning specified therefor in Section 14.2(a).
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"HRP Investment" means those certain Restaurants that are (i) managed by
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Grill Concepts Management, Inc., a California corporation, Grill Concepts, Inc.,
a California corporation, or HRP Restaurants, (ii) not owned by Borrower or any
Guarantor, and (iii) located in Burbank, Georgetown, Portland, Houston, San
Francisco, or Long Beach.
"HRP Restaurants" means Hotel Restaurant Properties, Inc.
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"Inactive Subsidiaries" means each of (a) Uno Concepts of Cherry Hill,
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Inc., a New Jersey corporation, (b) CTS, Inc., a New Jersey corporation, (c) Uno
Concepts of New Jersey, Inc., a New Jersey corporation, (d) Alcoli 66, Inc., a
New Jersey corporation, and (e) Uno Concepts, Inc., a New Jersey corporation.
"Indebtedness" means (a) all obligations for borrowed money, (b) all
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obligations evidenced by bonds, debentures, notes, or other similar instruments
and all reimbursement or other obligations in respect of letters of credit,
bankers acceptances, interest rate swaps, or other financial products, (c) all
obligations as a lessee under Capital Leases, (d) all obligations or liabilities
of others secured by a Lien on any asset of a Person or its Subsidiaries,
irrespective of whether such obligation or liability is assumed, (e) all
obligations to pay the deferred purchase price of assets (other than trade
payables incurred in the ordinary course of business and repayable in accordance
with customary trade practices), (f) all obligations owing under Hedge
Agreements, and (g) any obligation guaranteeing or intended to guarantee
(whether directly or indirectly guaranteed, endorsed, co-made, discounted, or
sold with recourse) any obligation of any other Person that constitutes
Indebtedness under any of clauses (a) through (f) above.
"Indemnified Liabilities" has the meaning specified therefor in Section
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10.3.
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"Indemnified Person" has the meaning specified therefor in Section 10.3.
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"Insolvency Proceeding" means any proceeding commenced by or against any
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Person under any provision of the Bankruptcy Code or under any other state or
federal bankruptcy or insolvency law, assignments for the benefit of creditors,
formal or informal moratoria, compositions, extensions generally with creditors,
or proceedings seeking reorganization, arrangement, or other similar relief.
"Intercompany Subordination Agreement" means a subordination agreement
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executed and delivered by Borrower, each of its Subsidiaries, and Agent, the
form and substance of which is satisfactory to Agent.
"Interest Expense" means, for any period, the aggregate of the interest
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expense of Borrower and its Subsidiaries for such period, determined on a
consolidated basis in accordance with GAAP.
"Interest Period" means, with respect to each LIBOR Rate Loan, a period
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commencing on the date of the making of such LIBOR Rate Loan (or the
continuation of a LIBOR Rate Loan or the conversion of a Base Rate Loan to a
LIBOR Rate Loan) and ending 1, 2, or 3 or 6 months thereafter; provided,
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however, that (a) if any Interest Period would end on a day that is not a
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Business Day, such Interest Period shall be extended (subject to clauses (c)-(e)
below) to the next succeeding Business Day, (b) interest shall accrue at the
applicable rate based upon the LIBOR Rate from and including the first day of
each Interest Period to, but excluding, the day on which any Interest Period
expires, (c) any Interest Period that would end on a day that is not a Business
Day shall be extended to the next succeeding Business Day unless such Business
Day falls in another calendar month, in which case such Interest Period shall
end on the next preceding Business Day, (d) with respect to an Interest Period
that begins on the last Business Day of a calendar month (or on a day for which
there is no numerically corresponding day in the calendar month at the end of
such Interest Period), the Interest Period shall end on the last Business Day of
the calendar month that is 1, 2, or 3 or 6 months after the date on which the
Interest Period began, as applicable, and (e) Borrower may not elect an Interest
Period which will end after the Maturity Date.
"Inventory" means inventory (as that term is defined in the Code).
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"Investment" means, with respect to any Person, any investment by such
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Person in any other Person (including Affiliates) in the form of loans,
guarantees, advances, or capital contributions (excluding (a) commission,
travel, and similar advances to officers and employees of such Person made in
the ordinary course of business, and (b) bona fide Accounts arising in the
ordinary course of business consistent with past practice), purchases or other
acquisitions of Indebtedness, Stock, or all or substantially all of the assets
of such other Person (or of any division or business line of such other Person),
and any other items that are or would be classified as investments on a balance
sheet prepared in accordance with GAAP.
"IRC" means the Internal Revenue Code of 1986, as in effect from time to
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time.
"Joint Venture Parties" means each of: (a) Continental Plaza Restaurant
-----------------------
Corp., a California corporation, (b) Michigan Avenue Group, a general
partnership, (c) TH Grill, Inc., a Delaware corporation, (d) Light Tower
Restaurant Associates, LLC, a California limited liability company, and (e)
Downtown Grill Investors, LLC a California limited liability company.
"Joint Venture Subsidiaries" means each of the following entities: (a) The
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Daily Grill at Continental Park, LLC, a California limited liability company,
(b) Chicago - The Grill on the Alley, LLC, an Illinois limited liability
company, (c) San Xxxx Grill, LLC, a California limited liability company, (d)
The Grill on Hollywood, LLC, a California limited liability company, (e) 612
Flower Daily Grill, LLC, a California limited liability company, and (f)
Universal Grill Concepts, Inc., a California corporation; and "Joint Venture
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Subsidiary" means any one of them.
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"Lender" and "Lenders" have the respective meanings set forth in the
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preamble to the Agreement, and shall include any other Person made a party to
the Agreement in accordance with the provisions of Section 13.1.
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"Lender Group" means, individually and collectively, each of the Lenders
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and Agent.
"Lender Group Expenses" means all (a) costs or expenses (including taxes,
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and insurance premiums) required to be paid by Borrower or its Subsidiaries
under any of the Loan Documents that are paid, advanced, or incurred by the
Lender Group, (b) actual out-of-pocket fees or charges paid or incurred by Agent
in connection with the Lender Group's transactions with Borrower or its
Subsidiaries, including, fees or charges for photocopying, notarization,
couriers and messengers, telecommunication, public record searches (including
tax lien, litigation, and UCC searches and including searches with the patent
and trademark office, the copyright office, or the department of motor
vehicles), filing, recording, publication, appraisal (including periodic
collateral appraisals or business valuations to the extent of the fees and
charges (and up to the amount of any limitation) contained in the Agreement),
real estate surveys, real estate title policies and endorsements, and
environmental audits, (c) costs and expenses incurred by Agent in the
disbursement of funds to Borrower or other members of the Lender Group (by wire
transfer or otherwise), (d) charges paid or incurred by Agent resulting from the
dishonor of checks, (e) reasonable costs and expenses paid or incurred by the
Lender Group to correct any default or enforce any provision of the Loan
Documents, or in gaining possession of, maintaining, handling, preserving,
storing, shipping, selling, preparing for sale, or advertising to sell the
Collateral, or any portion thereof, irrespective of whether a sale is
consummated, (f) audit fees and expenses of Agent related to any inspections or
audits to the extent of the fees and charges (and up to the amount of any
limitation) contained in the Agreement or any other Loan Document, (g)
reasonable costs and expenses of third party claims or any other suit paid or
incurred by the Lender Group in enforcing or defending the Loan Documents or in
connection with the transactions contemplated by the Loan Documents or the
Lender Group's relationship with Borrower or any its Subsidiaries, (h) Agent's
reasonable costs and expenses (including attorneys fees) incurred in advising,
structuring, drafting, reviewing, administering, syndicating, or amending the
Loan Documents, and (i) Agent's and each Lender's reasonable costs and expenses
(including attorneys, accountants, consultants, and other advisors fees and
expenses) incurred in terminating, enforcing (including attorneys, accountants,
consultants, and other advisors fees and expenses incurred in connection with a
"workout," a "restructuring," or an Insolvency Proceeding concerning Borrower or
its Subsidiaries or in exercising rights or remedies under the Loan Documents),
or defending the Loan Documents, irrespective of whether suit is brought, or in
taking any Remedial Action concerning the Collateral. The foregoing to the
contrary notwithstanding, the Borrower's obligation to reimburse the Lender
Group for attorney's fees prior to the occurrence of a Default or an Event of
Default shall be limited to the attorney's fees of one law firm for all members
of the Lender Group.
"Lender-Related Person" means, with respect to any Lender, such Lender,
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together with such Lender's Affiliates, officers, directors, employees,
attorneys, and agents.
"Leverage Ratio" means, with respect to Borrower and its Subsidiaries as of
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any date of determination, the ratio of (a) Revolver Usage as of such date, to
(b) TTM EBITDA as of such date.
"Liabilities" has the meaning set forth in Section 2.15.
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"LIBOR Deadline" has the meaning specified therefor in Section 2.13(b)(i).
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"LIBOR Notice" means a written notice in the form of Exhibit L-1.
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"LIBOR Option" has the meaning specified therefor in Section 2.13(a).
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"LIBOR Rate" means, for each Interest Period for each LIBOR Rate Loan, the
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greater of (a) the rate per annum determined by Agent (rounded upwards, if
necessary, to the next 1/100%) by dividing (i) the Base LIBOR Rate for such
Interest Period, by (ii) 100% minus the Reserve Percentage and (b) 4.00%. The
LIBOR Rate shall be adjusted on and as of the effective day of any change in the
Reserve Percentage.
"LIBOR Rate Loan" means each portion of an Advance that bears interest at a
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rate determined by reference to the LIBOR Rate.
"LIBOR Rate Margin" means, as of any date of determination, the following
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margin based upon the most recent Leverage Ratio calculation; provided, however,
that (a) for the period from the Closing Date through September 30, 2006, the
LIBOR Rate Margin shall be at the margin in the row styled "Level III", and (b)
at any time that a Default or an Event of Default has occurred (until the first
day of the first fiscal quarter following the date on which such Default or
Event of Default is no longer continuing) under Section 7.1 of this Agreement or
under of Section 7.2(a) of this Agreement (with respect to a breach of Section
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6.16 only), the LIBOR Rate Margin shall be at the margin in the row styled
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"Level IV":
