May 29, 1996
Pacific Mutual Life Insurance Company
000 Xxxxxxx Xxxxxx Xxxxx
X.X. Xxx 0000
Xxxxxxx Xxxxx, Xxxxxxxxxx 00000-0000
Attention: Fixed Income Securities Department
Pacific Corinthian Life Insurance Company
000 Xxxxxxx Xxxxxx Xxxxx
X.X. Xxx 0000
Xxxxxxx Xxxxx, Xxxxxxxxxx 00000-0000
Attention: Fixed Income Securities Department
Lutheran Brotherhood
000 Xxxxxx Xxxxxx Xxxxx
Xxxxxxxxxxx, Xxxxxxxxx 00000
Re: Amendment No. 2 to:
Each of the three separate Note Agreements, dated as of March 30,
1993, and entered into between NPC International, Inc., formerly
National Pizza Company (the "Company"), as the first party
thereto, and Pacific Mutual Life Insurance Company, Pacific
Corinthian Life Insurance Company and Lutheran Brotherhood,
respectively, as the second party thereto.
Ladies and Gentlemen:
We refer to the Note Agreements described above as each may have
been amended through the date hereof, including those amendments set forth
in the letter agreements dated May 24, 1995, (collectively, the "Existing
Agreements"). The addressees of this letter shall be referred to herein
individually as a "Lender," and collectively as the "Lenders." All other
capitalized terms used herein but not defined herein shall have the meanings
assigned to them in the Existing Agreements.
The Company has sold Skipper's, Inc., a wholly owned subsidiary of
the Company. Xxxx Xxxx'x Inc., another wholly owned subsidiary of the
Company, has closed certain of its restaurant locations that are no longer
useful in the conduct of its business. In connection with the Skipper's
sale and the Xxxx Xxxx closings, the Company has taken a charge against
consolidated income for the fiscal quarter ending March 26, 1996. Also, as
a result of the Skipper's sale and the Xxxx Xxxx closings and certain other
transactions contemplated by the Company, certain provisions and covenants
in the Existing Agreements require amendment. Accordingly, each Lender and
the Company hereby agrees as follows with respect to each Existing Agreement
as to which that Lender is a party.
1. The provisions of each of Subsection 5F and Subsection 6C(5)
and Subsection 6C(6) of each of the Existing Agreements are hereby amended
by deleting the period at the end thereof and replacing it with the
following phrase "; provided, however, that the Company may effect the
Skipper's Sale."
2. The provisions of Subsection 6A of each of the Existing
Agreements are hereby amended to read in their entirety as follows:
"Consolidated Net Worth Requirement. The Company
covenants that it will not permit consolidated Net Worth
at any time to be less than the sum of (i) $77,000,000
plus (ii) an amount equal to 50% of Consolidated Net
Income (without reduction for any deficit in
Consolidated Net Income for any quarterly fiscal period)
for the period from and after March 26, 1996, to and
including the date of determination thereof, computed on
a cumulative basis for said entire period."
3. The provisions of Section 10 of each of the Existing
Agreements are hereby amended as follows:
A. The following defined terms shall be inserted in Section 10
in the appropriate alphabetical order:
"Acquisition Agreement" shall mean the Acquisition
Agreement dated as of March 25, 1996, by and among
Seattle Crab Co., the Company and Skipper's, Inc.
"Indemnification Agreements" shall mean, collectively,
the Lease Indemnification Agreement and the Liability
Assumption Agreement, as those agreements are defined
and identified in the Acquisition Agreement.
"Skipper's Sale" shall mean the Company's sale of the
common stock of Skipper's, Inc. in accordance with all
of the terms and conditions of the Acquisition
Agreements.
B. The defined term "Funded Debt" shall be amended by deleting
the period at the end of the definition thereof, and replacing it with the
following phrase: "; provided, however, that the term "Funded Debt" shall
not include any of the company's obligations under the Indemnification
Agreement."
C. The defined term "Consolidated Net Income" shall be amended
by deleting the period at the end of the definition thereof, and replacing
it with the following phrase:
"; provided, however, that for purposes of calculating
Consolidated Net Income with respect to the last day of
the fiscal quarter ending March 26, 1996, and with
respect to the last day of each of the next three
successive fiscal quarters thereafter, Consolidated Net
Income Available for Fixed Charges shall be calculated
without regard for any charges against income in
connection with the Skipper's Sale or in connection with
the closure or relocation of up to eight Xxxx Xxxx'x
locations during calendar year 1996, which might
otherwise be required under GAAP."
D. The defined term "EBITDA" shall be amended by deleting the
period at the end of the definition thereof, and replacing it with the
following phrase:
"; provided, however, that for purposes of calculating
EBITDA with respect to the last day of the fiscal
quarter ending March 26, 1996, and with respect to the
last day of each of the next three successive fiscal
quarters thereafter, EBITDA shall be calculated without
regard for any charges against income in connection with
the Skipper's Sale or in connection with the closure or
relocation of up to eight Xxxx Xxxx'x locations during
calendar year 1996, which might otherwise be required
under GAAP."
Except as expressly amended as set forth above, the Existing
Agreements remain in full force and effect and are hereby ratified and
confirmed. The execution, delivery and effectiveness of this Amendment No.
2 shall not, except as expressly provided herein, operates as an amendment
or waiver of any provision of the Existing Agreements.
This Amendment may be executed in any number of counterparts and
by any combination of the parties hereto in separate counterparts, each of
which counterparts shall be an original and all of which taken together
shall constitute one and the same Amendment.
If you agree to the terms and provisions hereof, please evidence
your agreement by executing and returning one counterpart of this Amendment
No. 2 to NPC International, Inc., 000 Xxxx 00xx Xxxxxx, X.X. Xxx 000,
Xxxxxxxxx, Xxxxxx 00000, Attention: Xxxx X. Xxxx. This Amendment No. 2
shall become effective as to any Lender as of the date first above written
when and if a counterpart of this Amendment No. 2 shall have been executed
by such Lender.
Very truly yours,
NPC INTERNATIONAL, INC.
By:
Name: Xxxx X. Xxxx
Title Vice President and Chief Financial
Officer
Agreed as of the date first above written:
PACIFIC MUTUAL LIFE INSURANCE COMPANY
By:
Name:
Title:
Agreed as of the date first above written:
PACIFIC CORINTHIAN LIFE INSURANCE COMPANY
By:
Name:
Title:
Agreed as of the date first above written:
LUTHERAN BROTHERHOOD
By:
Name:
Title: