EXHIBIT 10.3
FIRST AMENDMENT TO GUARANTY,
SUBORDINATION AGREEMENT, SECURITY AGREEMENT
AND INDEMNITY
This First Amendment to Guaranty, Subordination Agreement, Security
Agreement and Indemnity is made and entered into this 1st day of December, 2001
by and among Concord Cruises, Inc. ("Cruises") as successor to Bayfront
Ventures, a Florida general partnership ("Bayfront"), and each of the lenders
listed in the signature block hereto (collectively, the "Lenders").
RECITALS
A. Bayfront executed a Guaranty, Subordination Agreement, Security
Agreement and Indemnity Agreement in favor of the Lenders dated as of
October 22, 1998 (the "Bayfront Agreement") in regard to a certain
Credit Agreement as defined therein. All capitalized terms not
otherwise defined herein shall have the meanings provided for in the
Bayfront Agreement.
B. On March 31, 2000, Bayfront was dissolved and liquidated by
operation of law when Cruises became the sole partner and the Bayfront
Agreement was assumed by Cruises as the successor of Bayfront. The
dissolution and liquidation of Bayfront violated paragraph 19(a)(1) of
the Bayfront Agreement.
C. The Credit Agreement is in default and the Lenders have the night to
proceed against the Borrower, Cruises and the other Guarantors of the
Borrower's indebtedness under the Credit Agreement.
D. The Borrower and the Lenders have entered into an Agreement dated
the date hereof (the "Agreement") in which the Lenders agree to waive
certain of the defaults, waive a portion of the default interest due as
a result thereof and enter into certain amendments to the Credit
Agreement and other documents including the Bayfront Agreement on
certain terms and conditions stated therein, one of which is that
Cruises enter into this Amendment.
E. The Borrower and the Lenders have amended the Credit Agreement by a
First Amendment thereto dated the date hereof (the "Amendment to the
Credit Agreement") pursuant to the Agreement.
F. Cruises and the Lenders desire to make certain conforming amendments
to the Bayfront Agreement and Cruises desires to confirm its guaranty
of the Credit Agreement as amended as set forth herein.
NOW, THEREFORE, in consideration of the Recitals, the entrance into the
Agreement by the Lenders, and for other good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, the parties agree as
follows:
1. Cruises acknowledges the accuracy of the Recitals, that the Credit
Agreement is in default, that such default is material, that Cruises is
in default under the Bayfront
Agreement in that Bayfront's dissolution violated paragraph 19(a)(1)
thereof, under paragraph 19(m) for the periods ending September 30,
2000, December 31, 2000, March 31, 2001, June 30, 2001, and September
30, 2001, and under paragraph 19(f) because Bayfront and Cruises
defaulted under Bayfront's Revolving Promissory Note dated January 18,
2000 to Integra Bank, that the Lenders are entitled to exercise their
remedies under the Bayfront Agreement and that Cruises has no claims,
set-offs or defenses to action by the Lenders under the Bayfront
Agreement to collect the Indebtedness from Cruises.
2. Cruises hereby reaffirms its assumption of the obligations of
Bayfront under the Bayfront Agreement including without limitation the
guaranty of the Indebtedness as set forth in the Bayfront Agreement and
affirms that such guaranty is unaffected by the Amendment to the Credit
Agreement and by the Agreement and the failure of the Lenders to pursue
remedies against the Borrower, Bayfront and the other Guarantors
regarding the existing defaults under the Credit Agreement. The Lenders
consent to the transfer of the Bayfront Agreement to Cruises and to
Cruises' assumption of the obligations of Bayfront thereunder.
3. Cruises acknowledges that the Lenders have demanded that all amounts
required to be deposited pursuant to paragraph 16 of the Bayfront
Agreement be deposited daily commencing on January 1, 2002 pursuant to
said paragraph and Section 6.18 of the Credit Agreement as amended.
Cruises agrees to make such deposits.
4. The Bayfront Agreement is hereby amended as follows effective as of
December 1, 2001:
a. The term "Bayfront" shall mean Bayfront Ventures, a
Florida general partnership, prior to its dissolution
and thereafter Concorde Cruises, Inc.
b. Paragraph 16 is amended by deleting therefrom the
words "during the continuance of an Event of
Default".
c. Paragraph 19(m) is hereby deleted and the following
is substituted in its place:
(m) Achieve for each month a combined Debt Service
Coverage Ratio of no less than 1.0 to 1.0.
d. The first sentence of paragraph 19(n) is hereby
amended to read as follows:
(n) At January 31, 2001 maintain a combined Tangible
Net Worth of $2,822,718 and at the end of each month
thereafter maintain a Tangible Net Worth equal to the
Tangible Net Worth requirement for the prior month
plus the greater of $1 or 10% of the combined net
income after taxes of the Borrower and Bayfront for
the current month.
2
e. Paragraph 19(o) is hereby amended (i) by replacing
the words and letters "forty-five" (45) days" by the
words and letters "twenty (20) days", (ii) by
replacing the words "fiscal quarter" with the words
"calendar month", (iii) by replacing the word
"quarter" with the word "month" each place it
appears, and (iv) by adding the following sentence at
the end thereof: "On a weekly basis, Bayfront shall
e-mail Servicer the passenger counts for the previous
week's cruises."
f. Paragraph 22 is hereby amended to change the name in
the address for notice to the Servicer to Integra
Bank from The National City Bank of Evansville and
the attention line for such notice to Xxxxxxxxxxx
Xxxxx.
g. The following paragraph 35 is hereby added after
paragraph 34:
34. RELIEF FROM AUTOMATIC STAY. BAYFRONT HEREBY
AGREES THAT, IN THE EVENT BAYFRONT SHALL (i) FILE
WITH ANY BANKRUPTCY COURT OF COMPETENT JURISDICTION
OR BE THE SUBJECT OF ANY PETITION UNDER TITLE 11 OF
THE U.S. CODE, AS AMENDED, (ii) BE THE SUBJECT OF ANY
ORDER FOR RELIEF ISSUED UNDER SUCH TITLE 11 OF THE
U.S. CODE, AS AMENDED, (iii) FILE OR BE THE SUBJECT
OF ANY PETITION SEEKING ANY REORGANIZATION,
ARRANGEMENT, COMPOSITION, READJUSTMENT, LIQUIDATION,
DISSOLUTION, OR SIMILAR RELIEF UNDER ANY PRESENT OR
FUTURE FEDERAL OR STATE ACT OR LAW RELATING TO
BANKRUPTCY, INSOLVENCY, OR OTHER RELIEF FOR DEBTORS,
(iv) HAVE SOUGHT OR CONSENTED TO OR ACQUIESCED IN THE
APPOINTMENT OF ANY TRUSTEE, RECEIVER, CONSERVATOR, OR
LIQUIDATOR, (v) BE THE SUBJECT OF ANY ORDER,
JUDGEMENT, OR DECREE ENTERED BY ANY COURT OF
COMPETENT JURISDICTION APPROVING A PETITION FILED
AGAINST SUCH PARTY FOR ANY REORGANIZATION,
ARRANGEMENT, COMPOSITION, READJUSTMENT, LIQUIDATION,
DISSOLUTION, OR SIMILAR RELIEF UNDER ANY PRESENT OR
FUTURE FEDERAL OR STATE ACT OR LAW RELATING TO
BANKRUPTCY, INSOLVENCY, OR RELIEF FOR DEBTORS.
LENDERS SHALL THEREUPON BE ENTITLED TO RELIEF FROM
ANY AUTOMATIC STAY IMPOSED BY SECTION 362 OF TITLE 11
OF THE U.S. CODE, AS AMENDED, OR OTHERWISE, ON OR
AGAINST THE EXERCISE OF THE RIGHT AND REMEDIES
OTHERWISE AVAILABLE TO LENDERS AS PROVIDED IN THE
LOAN DOCUMENTS AND THE BAYFRONT AGREEMENT.
3
IN WITNESS WHEREOF, the undersigned have executed this First Amendment
as of the date first above written.
CONCORDE CRUISES, INC.
By: /s/ Xxxxx X. Xxxx
--------------------------------------
Its President
--------------------------------------
INTEGRA BANK, as successor to The
National City Bank of Evansville, for
itself and for FIRST NATIONAL BANK, LINN
COUNTY BANK, UNITED PRAIRIE BANK -
XXXXXXX and PEOPLES NATIONAL BANK OF
KEWANEE
By: /s/ Xxxxxxxxxxx Xxxxx
--------------------------------------
Its Senior Vice President
--------------------------------------
4