Exhibit 10.13
THIRD AMENDMENT TO LOAN AGREEMENT
THIS THIRD AMENDMENT ("Amendment") made as of this 28th day of
November, 1998 among XXXXXXXX'X XXXXX'X, INC., a Delaware corporation having its
principal place of business at 000 Xxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000
(the "Borrower"), each of the Subsidiaries of the Borrower listed on Schedule 1
annexed to the Agreement (as hereinafter defined) (individually, a "Guarantor"
and collectively, the "Guarantors") (the Borrower and the Guarantors,
collectively, the "Credit Parties"), EUROPEAN AMERICAN BANK, a New York banking
organization, having an office at 000 Xxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000
("EAB" or a "Bank"), ISRAEL DISCOUNT BANK OF NEW YORK, a New York banking
organization, having an office at 000 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000
("Israel Discount" or a "Bank"), KEYBANK NATIONAL ASSOCIATION, a national
banking association, having an office at 0000 Xxxxx Xxxxxxx, Xxxxxxxx, Xxx Xxxx
00000 ("Key" or a "Bank") and BANK LEUMI USA (formerly known as Bank Leumi Trust
Company of New York), a New York trust company, having an office at 000 Xxxxx
Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 ("Leumi" or a "Bank") and EUROPEAN AMERICAN
BANK, as agent for the Banks (the "Agent").
W I T N E S S E T H :
WHEREAS, the Credit Parties, the Banks and the Agent have entered into
a Loan Agreement dated as of the 7th day of November, 1997, which Loan Agreement
has heretofore been amended pursuant to that certain First Amendment dated April
30, 1998 and that certain Second Amendment dated as of August 29, 1998 (as so
amended, the "Agreement"); and
WHEREAS, the Banks have made loans to the Borrower as evidenced by
certain notes of the Borrower and specifying interest to be paid thereon; and
WHEREAS, the Credit Parties have requested that the Agent and the Banks
agree to amend (i) the Cleandown Period requirement, (ii) the delivery date for
the financial schedule showing EBITDA operating results by store location for
the fiscal quarter ended November 29, 1998 required under Section 5.01(b) (iii)
of the Agreement, and (iii) the delivery date for the lease status certificate
required under Section 5.01(b)(xiii) of the Agreement for the fiscal quarter
ended November 29, 1998;
WHEREAS, the Credit Parties have requested that the Agent and the Banks
amend certain of the financial covenants contained in Section 5.03 of the
Agreement; and
WHEREAS, the Agent and the Banks have agreed to amend (i) the Cleandown
Period requirement, (ii) the delivery date for the financial schedule showing
EBITDA operating results by store location for the fiscal quarter ended November
29, 1998 required under Section 5.01(b)(iii) of the Agreement, and (iii) the
delivery date for the lease status certificate required under Section
5.01(b)(xiii) of the Agreement for the fiscal quarter ended November 29, 1998;
and
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WHEREAS, the Agent and the Banks have agreed to amend certain of the
financial covenants contained in Section 5.03 of the Agreement on the terms and
conditions contained herein; and
NOW, THEREFORE, in consideration of Ten ($10.00) Dollars and other good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the Credit Parties, the Banks and the Agent do hereby agree as
follows:
1. DEFINED TERMS. As used in this Amendment, capitalized terms,
unless otherwise defined, shall have the meanings set forth in the Agreement.
2. REPRESENTATIONS AND WARRANTIES. As an inducement for the Bank
to enter into this Amendment, the Credit Parties each represent and warrant as
follows:
A. That with respect to the Agreement and the Loan Documents
executed in connection therewith and herewith:
(i) There are no defenses or offsets to the
Borrower's or any Guarantor's obligations under the Agreement
as amended hereby, the Notes or any of the Loan Documents or
any other agreements in favor of the Bank referred to in the
Agreement, and if any such defenses or offsets exist without
the knowledge of the Borrower or any Guarantor, the same are
hereby waived.
(ii) All of the representations and warranties made
by the Borrower and any Guarantor in the Agreement as amended
hereby are true and correct in all material respects as if
made on the date hereof, except for those made with respect to
a particular date, which such representations and warranties
are restated as of the date of this Amendment to be true and
correct in all material respects as of such date; and provided
further that the representations and warranties set forth in
Section 4.01(f) of the Agreement shall relate to the audited
consolidated financial statements of the Borrower and its
Consolidated Subsidiaries for the fiscal year ended November
30, 1997 and the internally prepared consolidated balance
sheet of the Borrower and its Consolidated Subsidiaries for
the fiscal quarter ended August 30, 1998.
(iii) The outstanding aggregate principal balance of
the Loans as evidenced by the Notes is $21,861,314.64 as of
February 23, 1999 and interest has been paid through February
1, 1999.
3. AMENDMENTS. The following amendments are hereby made to the
Agreement:
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(a) The definition of Cleandown Period is hereby deleted in
its entirety and replaced as follows:
"'Cleandown Period', means a period, declared by the Borrower
to be the "Cleandown Period", of thirty (30) consecutive days
during each fiscal year of the Borrower, commencing with the
Borrower's fiscal year beginning November 30, 1998."
(b) The definition of EBITDA is hereby deleted in its entirety
and replaced as follows:
"'EBITDA' means, as to the Borrower and its Consolidated
subsidiaries for any period, the sum of (i) net income
(excluding extraordinary gains and losses), plus (ii) interest
expense, plus, (iii) depreciation expense, plus (iv)
amortization of intangible assets, plus (v) federal, state and
local income taxes deducted in calculating net income, plus
(vi) non-cash rent leveling expenses, in each case measured
for the Borrower and its Consolidated Subsidiaries on a
consolidated basis for such period, computed and consolidated
in accordance with GAAP."
(c) The definition of Revolving Credit Maturity Date is hereby
deleted in its entirety and replaced as follows:
"'Revolving Credit Maturity Date' means November 29, 1999."
(d) Section 5.01(b) (iii) of the Agreement is hereby deleted
its entirety and replaced as follows:
"(iii) CONSOLIDATING FINANCIAL STATEMENTS. (1) As soon as
available and in any event within ninety (90) days after the
end of each fiscal year of the Borrower and within sixty (60)
days after the end of each of the first three fiscal quarters
of the Borrower, a copy of the consolidating financial
statements of the Borrower and its operating Subsidiaries for
such year or quarter, including balance sheets with related
statements of income and retained earnings and statements of
cash flows, all in reasonable detail and setting forth in
comparative form the figures for the previous fiscal year or
previous fiscal quarter, all such financial statements to be
prepared by management of the Borrower in accordance with
GAAP, and (2) as soon as available and in any event within
sixty (60) days after the end of each fiscal quarter of the
Borrower, including the fourth fiscal quarter (ninety (90)
days in the case of the fiscal
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quarter ending November 29, 1998), a copy of a financial
schedule showing EBITDA operating results by store location
for such quarter, prepared by management of the Borrower."
(e) Section 5.01(b)(xiii) of the Agreement is hereby deleted
in its entirety and replaced as follows:
"(xiii) LEASE STATUS CERTIFICATE. As soon as available and in
any event within sixty (60) days after the end of each fiscal
quarter (ninety (90) days in the case of the fiscal quarter
ending November 29, 1998), a certificate from the chief
financial officer of the Borrower setting forth the Credit
Parties' payment status for all leases of real property, in
form and substance reasonable satisfactory to the Agent."
(f) Section 5.02(l) of the Agreement is hereby deleted in its
entirety and replaced as follows:
"(l) LOSSES. Incur a net loss (i) for the fiscal year ending
November 29, 1998 in excess of $330,000.00, or (ii) for any
fiscal year thereafter."
(g) Section 5.03(c) of the Agreement is hereby deleted in its
entirety and replaced as follows:
"(c) LEVERAGE RATIO. The Borrower and the Guarantors will at
all times maintain a Leverage Ratio, to be tested quarterly,
of not greater than the following:
Period Leverage Ratio
------------------------------ --------------
From the date of the Agreement 3.00 to 1.00
until February 27, 1999
From February 28, 1999 until 2.50 to 1.00
May 29, 1999
From May 30, 1999 until 2.25 to 1.00
May 27, 2000
From May 28, 2000 2.00 to 1.00
and thereafter."
(h) Section 5.03(d) of the Agreement is hereby deleted in its
entirety and replaced as follows:
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"(d) FUNDED DEBT TO EBITDA RATIO. The Borrower and Guarantors
will maintain at all times on a consolidated basis, a Funded
Debt to EBITDA Ratio, to be tested quarterly, of not greater
than the following:
Period Funded Debt to EBITDA Ratio
---------------------------- ---------------------------
From February 28, 1999 until 2.50 to 1.00
August 28, 1999
From August 29, 1999 until 2.25 to 1.00
August 26, 2000
From August 27, 2000 and 2.00 to 1.00
thereafter."
(i) Section 5.03(e) of the Agreement is hereby deleted in its
entirety and replaced as follows:
"(e) FIXED CHARGE COVERAGE RATIO. The Borrower and Guarantors
will maintain at all times (other than for the fiscal quarter
ending August 30, 1998 and the fiscal year ending November 29,
1998), beginning with the fiscal quarter ending May 31, 1998,
on a consolidated basis, a minimum Fixed Charge Coverage Ratio
of not less than 1.25 to 1.0, such ratio to be tested
quarterly. The Borrower and Guarantors will maintain at all
times on a consolidated basis during the fiscal quarter ending
August 30, 1998 and the fiscal year ending November 29, 1998,
a minimum Fixed Charge Coverage Ratio of not less than 1.10 to
1.0."
(j) Section 5.03(f) of the Agreement is hereby deleted in its
entirety and replaced as follows:
"DEBT SERVICE RATIO. The Borrower and Guarantors will maintain
at all times during the fiscal year ending November 29, 1998,
on a consolidated basis, a minimum Debt Service Ratio of not
less than 1.45 to 1.0. The Borrower and Guarantors will
maintain at all times, beginning with the fiscal quarter
ending May 31, 1998 (other than for the fiscal year ending
November 29, 1998), on a consolidated basis, a minimum Debt
Service Ratio of not less than 1.50 to 1.0, such ratio to be
tested quarterly."
4. EFFECTIVENESS. This Amendment shall become effective upon the
occurrence of the following events and the receipt and satisfactory review by
the Agent and its counsel of the following documents:
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(a) The Agent and each Bank shall have received this
Amendment, duly executed by the Borrower and each Guarantor.
(b) The Agent shall have received copies of any and all
modifications of the documentation referred to in Section 3.01 of the Agreement
which could result in a Material Adverse Change.
(c) The Agent shall have been paid, on behalf of the Banks, an
amendment fee in the amount of $10,000.00.
5. GOVERNING LAW. This Amendment shall be governed by, and construed in
accordance with, the laws of the State of New York.
6. COUNTERPARTS. This Amendment may be executed in any number of
counterparts and by different parties hereto in separate counterparts, each of
which when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement.
7. RATIFICATION. Except as hereby amended, the Agreement and all other
Loan Documents executed in connection therewith shall remain in full force and
effect in accordance with their originally stated terms and conditions. The
Agreement and all other Loan Documents executed in connection therewith, as
amended hereby, are in all respects ratified and confirmed.
8. WAIVER OF JURY TRIAL. The Borrower, each Guarantor, the Agent and
the Banks waive all rights to trial by jury on any cause of action directly or
indirectly involving the terms, covenants or conditions of this Amendment or any
Loan Document.
REMAINDER OF PAGE INTENTIONALLY LEFT BLANK
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IN WITNESS WHEREOF, the parties hereto have executed this Amendment as
of the year and date first above written.
EUROPEAN AMERICAN BANK, as Agent
By: /s/ Xxxxxx X. Xxxxxxxx
---------------------------------
Xxxxxx X. Xxxxxxxx
Vice President
EUROPEAN AMERICAN BANK
By: /s/ Xxxxxx X. Xxxxxxxx
---------------------------------
Xxxxxx X. Xxxxxxxx
Vice President
ISRAEL DISCOUNT BANK OF NEW YORK
By: /s/ Xxxxx Xxxxxxxx
---------------------------------
Name: Xxxxx Xxxxxxxx
Title: Vice President
By: /s/ Xxxx Xxxx
---------------------------------
Name: Xxxx Xxxx
Title: Senior Vice President
KEYBANK NATIONAL ASSOCIATION
By: /s/ Xxxxxx Xxxxx
---------------------------------
Name: Xxxxxx Xxxxx
Title: Vice President
BANK LEUMI USA
By: /s/ Xxxxxxx Xxxxxxxxxxx
---------------------------------
Name: Xxxxxxx Xxxxxxxxxxx
Title: First Vice President
By: /s/ Xxxxxx Xxxxxxxxxxx
---------------------------------
Name: Xxxxxx Xxxxxxxxxxx
Title: Vice President
XXXXXXXX'X XXXXX'X, INC.
By: /s/ Xxxx Xxxxxxxxxxxx
---------------------------------
Xxxx Xxxxxxxxxxxx
Chief Executive Officer
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CITY PRODUCE OPERATING CORP.
By: /s/ Xxxx Xxxxxxxxxxxx
---------------------------------
Xxxx Xxxxxxxxxxxx
President
GRISTEDE'S OPERATING CORP.
By: /s/ Xxxx Xxxxxxxxxxxx
---------------------------------
Xxxx Xxxxxxxxxxxx
President
NAMDOR INC.
By: /s/ Xxxx Xxxxxxxxxxxx
---------------------------------
Xxxx Xxxxxxxxxxxx
President
RAS OPERATING CORP.
By: /s/ Xxxx Xxxxxxxxxxxx
---------------------------------
Xxxx Xxxxxxxxxxxx
President
SAC OPERATING CORP.
By: /s/ Xxxx Xxxxxxxxxxxx
---------------------------------
Xxxx Xxxxxxxxxxxx
President
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