EXHIBIT 10.1
AMENDMENT NO. 1 AND CONSENT
This Amendment No. 1 and Consent dated as of October 17, 2000 ("Agreement")
is among Xxxxxx'x Seafood Restaurants, Inc., a Delaware corporation (the
"Borrower"), the lenders from time to time party to the Credit Agreement
described below ("Lenders"), and Bank of America, N.A., as administrative agent
for the Banks ("Administrative Agent").
INTRODUCTION
A. The Borrower, the Administrative Agent, and the Lenders are parties to
the Credit Agreement dated as of June 28, 2000 ("Credit Agreement").
B. The Borrower has requested that the Lenders (1) agree to make certain
amendments to the Credit Agreement in connection with the tender offer and
purchase (the "Transaction") by the Borrower of the common stock of Rainforest
Cafe, Inc. ("Target") subject to the terms hereof and (2) consent to the
Transaction.
C. Subject to the terms hereof, the Lenders party to this Agreement (1)
consent to the Transaction and (2) agree to the amendments contained herein.
THEREFORE, the Borrower, the Administrative Agent, and the Lenders hereby
agree as follows:
Section 1. Definitions. Unless otherwise defined in this Agreement,
terms used in this Agreement which are defined in the Credit Agreement shall
have the meanings assigned to such terms in the Credit Agreement.
Section 2. Amendment. The Credit Agreement shall be amended as
follows:
(a) The following definitions in Section 1.01 shall be amended to read in
their entirety as follows:
"Applicable Amount" means the following amounts per annum, based upon
the Leverage Ratio as set forth in the most recent Compliance Certificate
received by Administrative Agent pursuant to Section 6.02(b):
Applicable Amount
Pricing Leverage Ratio Commitment Offshore Rate Base Rate
Level fee + +
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1 (less than or equal to) 1.0:1 0.50% 2.00% 0.25%
2 (greater than) 1.0:1 but 0.50% 2.25% 0.50%
(less than or equal to) 1.5:1
3 (greater than) 1.5:1 but 0.50% 2.50% 0.75%
(less than or equal to) 2.25:1
4 (greater than) 2.25:1 0.50% 3.00% 1.25%
; provided that on and after December 31, 2001, Pricing Level 4 shall not
apply, and the Applicable Amount for all Leverage Ratios greater than
1.5:1.0 shall be at Pricing Level 3.
The Applicable Amount shall be in effect from the date the most recent
Compliance Certificate is received by Administrative Agent to but excluding
the date the next Compliance Certificate is received; provided, however,
that if the Borrower fails to timely deliver the next Compliance
Certificate, the Applicable Amount from the date such Compliance
Certificate was due to but excluding the date such Compliance Certificate
is received by Administrative Agent shall be the highest pricing level set
forth above, and, thereafter, the pricing level indicated by such
Compliance Certificate when received.
"Consolidated EBITDA" means, for any period, an amount equal to the
sum of (a) Consolidated Net Income for such period, (b) Consolidated
Interest Charges for such period, (c) the amount of taxes, based on or
measured by income, used or included in the determination of such
Consolidated Net Income for such period, and (d) the amount of depreciation
and amortization expense deducted in determining such Consolidated Net
Income for such period. Charges of the Borrower (i) that are directly
related to Acquisitions (other than the acquisition of Rainforest Cafe,
Inc.) permitted under this Agreement and which pursuant to GAAP would be
classified as "noncash" charges or expenses shall be excluded from the
calculation of Consolidated EBITDA, provided such charges are taken by the
Borrower within six months of such Acquisition and (ii) in the fiscal
quarter ending June 30, 2000, the lesser of (A) $2,000,000 and (B) to the
extent deducted from Consolidated Net Income, the amount of special charges
related to the Rainforest Cafe, Inc. acquisition incurred in such quarter
shall be excluded from the calculation of this definition. The historical
Consolidated EBITDA for the relevant measurement period of entities that
are acquired by the Borrower after the Closing Date will be included in the
calculation of Consolidated EBITDA provided that the Administrative Agent
and the Lenders are furnished with audited financial statements of such
entities (or if the Acquisition is of a division or branch of a larger
business or a group of businesses, the audited financial statements of such
larger business or group of businesses, so
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long as the individual activities of the acquired entity are clearly
reflected in such financial statements, together with a certificate
certifying that the Borrower has reviewed the historical financial
statements of the division or branch and that they reflect proper
divisional accounting in relation to the large business or group of
businesses), reasonably satisfactory to Administrative Agent and the
Requisite Lenders in all respects, confirming such historical results. To
the extent deducted in the determination of Consolidated Net Income, the
charges or expenses related to Rainforest Cafe, Inc. and listed on Exhibit
A attached to Amendment No. 1 and Consent to this Agreement shall be
excluded, in amounts not to exceed the amounts stated on such Exhibit A,
from the calculation of Consolidated EBITDA. Notwithstanding anything to
the contrary in this Agreement, any expenses, charges, or reserves accrued
in excess of $25,000,000 (as reduced pursuant to this sentence, the
"Reserve Amount") in connection with the acquisition by the Borrower of
Rainforest Cafe, Inc. shall reduce Consolidated EBITDA; provided that the
Reserve Amount shall be reduced by the amount, if any, of any similar
reserves charged by Rainforest Cafe, Inc. between July 1, 2000 and the
Merger Date.
"Maintenance Capital Expenditures" means the sum of (a) $65,000
multiplied by the number of restaurants in operation by the Borrower at the
time of measurement, excluding restaurants operated by the Rainforest Cafe
division of the Borrower and (b) $100,000 multiplied by the number of
restaurants in operation by the Rainforest Cafe division of the Borrower at
the time of measurement, excluding the eleven restaurants designated for
closure in writing to the Administrative Agent, provided each such
restaurant is closed or subject to a specific closure agreement with the
landlord of such restaurant's location no later than June 30, 2001.
(b) The following definitions shall be added to Section 1.01:
"Merger Date" means the date on which the Borrower or any of its
Affiliates merges with Rainforest Cafe, Inc.
"Rainforest Acquisition Effective Date" means the date on which the
Borrower is obligated to purchase an amount of the common stock of
Rainforest Cafe, Inc. which, when added to the amount of common stock of
Rainforest Cafe, Inc. which is already owned by the Borrower or any of its
Affiliates, comprises greater than 50% of the total outstanding common
stock of Rainforest Cafe, Inc.
(c) Section 7.07(a) is amended to read in its entirety as follows:
(a) the Borrower may repurchase shares of its own stock for an
aggregate purchase price not to exceed $36,000,000 after the Closing Date;
provided that, during the period between (i) the Rainforest Acquisition
Effective Date and (ii) the date upon which the Borrower's actual reported
Leverage Ratio is less than or equal to 2.00 to 1.0, which date shall not
be sooner than December 31, 2001, the limit on
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aggregate purchase price of repurchased shares acquired during such period
shall be $6,000,000; and
(d) Section 7.11(a) is amended to read in its entirety as follows:
(a) after giving effect to such Acquisition, the aggregate purchase price
(including cash, stock, and debt assumed ) of all such Acquisitions during
any fiscal year does not exceed $55,000,000; provided that, during the
period between (i) the closing of the Rainforest Acquisition Effective Date
and (ii) the date upon which the Borrower's actual reported Leverage Ratio
is less than or equal to 2.00 to 1.0, which date shall not be sooner than
December 31, 2001, such limit on aggregate purchase price shall be
$7,500,000 plus up to $15,000,000 to be used only for one Acquisition of a
single-location restaurant operation in either Xxxxxx County, Texas or
Galveston County, Texas,
(e) Section 7.14(c) is amended to read in its entirety as follows:
(c) Leverage Ratio. Permit the Leverage Ratio to be greater than (i)
2.50 to 1.0 at any time during any fiscal quarter ending on or prior to
September 30, 2001 and (ii) 2.25 to 1.0 during any fiscal quarter ending on
or after December 31, 2001.
(f) Section 7.14 is amended to add the following subsection (d):
(d) Minimum Restaurant Level Profit. Permit the Consolidated EBITDA
for the four fiscal quarters most recently ended plus corporate general and
administrative and pre-opening expenses for the four fiscal quarters most
recently ended (i) for the Joe's Crabshack, Xxxxxx'x Seafood House, and The
Crabhouse divisions of the Borrower to be less than $70,000,000 in the
aggregate or (ii) for the Rainforest Cafe, Inc. division of the Borrower to
be less than $25,000,000.
Section 3. Consent. Upon the satisfaction of the conditions to the
effectiveness of this Agreement, the Lenders hereby consent to the Transaction,
provided that (a) the cash consideration for the Transaction may not exceed
$86,000,000, which amount shall include near term severance costs, cash payouts
for options, non-compete payments, and other transaction costs, but shall
exclude the Reserve Amount, and (b) immediately after the Rainforest Acquisition
Effective Date, Rainforest Cafe, Inc. shall have at least $15,000,000 in cash
that may be used by the Borrower.
Section 4. Representations and Warranties. The Borrower represents and
warrants to the Administrative Agent and the Lenders that:
(a) the representations and warranties set forth in the Credit Agreement
and in the other Loan Documents are true and correct in all material respects as
of the date of this Agreement;
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(b) (i) the execution, delivery and performance of this Agreement are
within the corporate power and authority of the Borrower and have been duly
authorized by appropriate proceedings and (ii) this Agreement constitutes a
legal, valid, and binding obligation of the Borrower, enforceable in accordance
with its terms, except as limited by applicable bankruptcy, insolvency,
reorganization, moratorium, or similar laws affecting the rights of creditors
generally and general principles of equity; and
(c) as of the effectiveness of this Agreement, no Default or Event of
Default has occurred and is continuing.
Section 5. Effectiveness. This Agreement shall become effective as of
the date of this Agreement, and the Credit Agreement shall be amended as
provided in this Agreement, upon the occurrence of the following conditions
precedent:
(a) the Borrower shall have delivered duly and validly executed originals
of this Agreement to the Administrative Agent and the Requisite Lenders and the
Administrative Agent shall have executed and delivered this Agreement;
(b) the representations and warranties in this Agreement shall be true and
correct in all material respects;
(c) the Administrative Agent shall have received a duly executed
reaffirmation of each Guaranty by a Subsidiary of the Borrower in form and
substance satisfactory to the Administrative Agent;
(d) the Borrower shall have paid to the Administrative Agent and to each
Lender the fees and expenses payable to them pursuant to the Offering Memorandum
dated September, 2000 and under any other agreement between the Borrower and the
Administrative Agent;
(e) (i) the Subsidiary of the Borrower which makes the tender offer for the
common stock of the Target shall have acquired more than a majority (on a fully
diluted basis) of the common stock of the Target in accordance with the terms of
the tender offer and in accordance with all applicable legal requirements; (ii)
taking into account the effect of shareholders' appraisal rights, the
Administrative Agent shall be satisfied that the sole right of the shareholders
of Target who do not tender their shares pursuant to the tender offer shall be
to receive a cash payment pursuant to the merger; (iii) the respective boards of
directors of the Target and the Borrower and its Subsidiaries shall not have
withdrawn, modified, or terminated their approval of the tender offer, the
documents relating thereto, or any of the transactions contemplated thereby;
(iv) the Lenders' financing of the tender offer and the security arrangements in
connection therewith shall not result in any violation of Regulations U or X as
in effect on the date of such financing; (v) the Administrative Agent shall be
satisfied that the tender offer and the merger can be consummated without
triggering any "poison pill," "shark repellant," or similar anti-takeover device
and without any adverse effect from any applicable anti-takeover statutes; and
(vi) the Administrative Agent shall have received a copy of a fairness opinion
relating to the Target; and
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(f) all governmental, shareholder, and all material third-party non-
governmental consents (including Xxxx-Xxxxx-Xxxxxx clearance) and approvals
required as of the closing date in connection with the Transaction and the other
transactions contemplated hereby shall have been obtained; all such consents and
approvals shall be in full force and effect; and all applicable waiting periods
shall have expired without any action being taken by any authority that could
reasonably be expected to restrain, prevent, or impose any material adverse
conditions on the Transaction or such other transactions or that could
reasonably be expected to seek or threaten any of the foregoing.
Section 6. Effect on Loan Documents.
(a) Except as amended herein, the Credit Agreement and the Loan Documents
remain in full force and effect as originally executed. Nothing herein shall
act as a waiver of any of the Administrative Agent's or Lenders' rights under
the Loan Documents, as amended, including the waiver of any Default or Event of
Default, however denominated.
(b) This Agreement is a Loan Document for the purposes of the provisions of
the other Loan Documents. Without limiting the foregoing, any breach of
representations, warranties, and covenants under this Agreement may be a Default
or Event of Default under other Loan Documents.
Section 7. Choice of Law. This Agreement shall be governed by and
construed and enforced in accordance with the laws of the State of New York.
Section 8. Counterparts. This Agreement may be signed in any number of
counterparts, each of which shall be an original.
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