EXHIBIT 10.29
AMENDMENT NUMBER THREE TO
LOAN AND SECURITY AGREEMENT
This AMENDMENT NUMBER THREE TO LOAN AND SECURITY AGREEMENT (this
"Amendment") is entered into as of April 9, 1998, by and between 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 Foothill to modify
certain financial covenants in the Agreement and to modify Schedules
C-1 and R-1 to the Agreement, in each case, as set forth in this
Amendment;
C. Foothill is willing to so modify the Agreement and such schedules in
accordance with the terms and conditions hereof; and
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. Amendments to the Agreement.
---------------------------
a. Section 7.20(a) of the Agreement hereby is amended and
restated in its entirety to read as follows:
(a) EBITDA - Chi-Chi's. In the case of Chi-Chi's, fail to
maintain EBITDA for the Relevant Measuring Period of not less than the
relevant amount set forth in the following table, measured on a fiscal
quarter-end basis:
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Period Ending Minimum EBITDA
----------------------------------------------------------------------------
12/31/96 ($2,000,000)
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3/31/97 ($2,000,000)
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============================================================================
Period Ending Minimum EBITDA
----------------------------------------------------------------------------
6/30/97 ($2,000,000)
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9/30/97 -0-
----------------------------------------------------------------------------
12/31/97 -0-
----------------------------------------------------------------------------
03/31/98 $500,000
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06/30/98 $500,000
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09/30/98 $500,000
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12/31/98 $1,000,000
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03/31/99 $1,000,000
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quarterly thereafter $2,000,000
============================================================================
b. Section 7.20(b) of the Agreement hereby is amended and
restated in its entirety to read as follows:
(b) EBITDA - El Torito. In the case of El Torito, fail to
maintain EBITDA for the Relevant Measuring Period of not less than the
relevant amount set forth in the following table, measured on a fiscal
quarter-end basis:
============================================================================
Period Ending Minimum EBITDA
----------------------------------------------------------------------------
12/31/96 $8,500,000
----------------------------------------------------------------------------
3/31/97 $9,000,000
----------------------------------------------------------------------------
6/30/97 $9,000,000
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9/30/97 $9,000,000
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12/31/97 $9,000,000
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03/31/98 $12,000,000
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06/30/98 $12,000,000
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09/30/98 $12,000,000
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12/31/98 $12,000,000
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03/31/99 $13,000,000
----------------------------------------------------------------------------
quarterly thereafter $13,000,000
============================================================================
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c. Section 7.20(c) of the Agreement hereby is amended and
restated in its entirety to read as follows:
(c) EBITDA - Combined. In the case of Chi-Chi's and El
Torito, on a combined basis, fail to maintain EBITDA for the Relevant
Measuring Period of not less than the relevant amount set forth in the
following table, measured on a fiscal quarter-end basis:
============================================================================
Period Ending Minimum EBITDA
----------------------------------------------------------------------------
12/31/96 n/a
----------------------------------------------------------------------------
3/31/97 n/a
----------------------------------------------------------------------------
6/30/97 n/a
----------------------------------------------------------------------------
9/30/97 $10,000,000
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12/31/97 $12,000,000
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03/31/98 $15,500,000
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06/30/98 $15,500,000
----------------------------------------------------------------------------
09/30/98 $15,500,000
----------------------------------------------------------------------------
12/31/98 $15,500,000
----------------------------------------------------------------------------
03/31/99 $16,500,000
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quarterly thereafter $16,500,000
============================================================================
2. Amendments to Schedules C-1 and R-1 to the Agreement.
----------------------------------------------------
a. Amended and Restated Schedule C-1 to the Agreement hereby is
---------------------------------
modified to add thereto the following properties:
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Concept Unit No. City State Legal Owner
============================================================================
Chi-Chi's 34 Deerfield IL Chi-Chi's
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Chi-Chi's 000 Xxxxxxxxxxx XX Chi-Chi's
----------------------------------------------------------------------------
Chi-Chi's 86 Champaign IL Chi-Chi's
============================================================================
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b. Schedule R-1 to the Agreement hereby is modified to delete
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therefrom the following properties:
============================================================================
Concept Unit No. City State Legal Owner
============================================================================
Chi-Chi's 34 Deerfield IL Chi-Chi's
----------------------------------------------------------------------------
Chi-Chi's 000 Xxxxxxxxxxx XX Chi-Chi's
----------------------------------------------------------------------------
Chi-Chi's 86 Champaign IL Chi-Chi's
============================================================================
3. Conditions Precedent to the Effectiveness of this Amendment. The
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effectiveness of this Amendment is subject to the fulfillment, to the
satisfaction of Foothill and its counsel, of each of the following conditions:
a. Foothill shall have received an amendment fee of Fifty
Thousand Dollars ($50,000), which fee is earned in full by Foothill, due and
payable by Borrower to Foothill concurrently with the execution and delivery of
this Amendment by Borrower, and non-refundable when paid;
b. Foothill shall have received the reaffirmation and consent
attached hereto as Exhibit A, duly executed by each Guarantor, and such document
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shall be in full force and effect;
c. The representations and warranties in this Amendment, the
Agreement as amended by this Amendment, and the other Loan Documents shall be
true and correct in all 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; and
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.
4. Representations and Warranties. Each of Borrower and FRI-MRD
------------------------------
hereby represents and warrants to Foothill that: (a) the execution, delivery,
and performance of this
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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; (b) this Amendment and the Agreement, as amended by
this Amendment, constitute Borrower's and FRI-MRD's legal, valid, and binding
obligation, enforceable against Borrower and FRI-MRD in accordance with its
terms.
5. Effect on Agreement. The Agreement, as amended hereby, shall be
-------------------
and remain in full force and effect in accordance with its respective terms and
hereby is ratified and confirmed in all respects. The execution, delivery, and
performance of this Amendment shall not operate as a waiver of or, except as
expressly set forth herein, as an amendment, of any right, power, or remedy of
Foothill under the Agreement, as in effect prior to the date hereof.
6. 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.
[remainder of page intentionally left blank]
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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 /s/ Xxxxxx Xxxxx
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Title: Treasurer
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EL TORITO RESTAURANTS, INC.,
a Delaware corporation
By /s/ Xxxxxx Xxxxx
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Title: Treasurer
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CHI-CHI'S INC.,
a Delaware corporation
By /s/ Xxxxxx Xxxxx
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Title: Treasurer
-----------------------
FOOTHILL CAPITAL CORPORATION,
a California corporation
By /s/ Xxxxx Xxxxxxxxx
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Title: Vice President
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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 Three
to Loan and Security Agreement, dated as of April __, 1998 (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.
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.,
a Kansas corporation
-S-2-
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
By _____________________________
Title: _________________________
CCMR OF CUMBERLAND, INC.,
a Kentucky corporation
By _____________________________
Title: Authorized Signatory
-S-3-
