EXHIBIT 10.45
SIXTH AMENDMENT
TO AMENDED AND RESTATED CREDIT AGREEMENT
This sixth amendment to amended and restated credit agreement
("Amendment"), effective as of December 31, 2001, is made and entered into by
and between REDHOOK ALE BREWERY, INCORPORATED, a Washington corporation
("Borrower"), and U.S. BANK NATIONAL ASSOCIATION, a national banking
association, successor by merger to U.S. Bank of Washington, National
Association ("U.S. Bank"). Words and phrases with initial capital letters have
the meanings given to them in Article I of this Amendment.
RECITALS:
A. On or about June 5, 1995, U.S. Bank and Borrower entered into that
certain amended and restated credit agreement (together with all amendments,
supplements, exhibits, and modifications thereto, the "Credit Agreement"),
whereby U.S. Bank agreed to make loans and advances of credit to Borrower on the
terms and conditions set forth therein.
B. Borrower and U.S. Bank have entered into five amendments to the
Credit Agreement, dated as of July 25, 1996, September 15, 1997, February 22,
1999, August 10, 2000, and June 19, 2001, respectively, whereby U.S. Bank
extended the Commitment Period of the Revolving Loan and otherwise modified the
terms of the Term Loan, Revolving Loan, and Acquisition Loan.
C. Borrower and U.S. Bank have agreed to waive certain financial
covenant defaults and to temporarily amend the Fixed Charge Coverage Ratio
covenant. The purpose of this Amendment is to set forth the terms of U.S. Bank's
agreement and the conditions upon which U.S. Bank will modify the Credit
Agreement and the other Loan Documents to evidence the parties' agreement.
NOW, THEREFORE, in consideration of the mutual covenants and conditions
set forth herein, the parties agree as follows:
ARTICLE I. DEFINITIONS AND AMENDMENT
1.1 Defined Terms. As used in this Amendment, words and phrases with
initial capital letters shall have the meanings given to them in the Credit
Agreement, except as otherwise defined herein, or as the context otherwise
requires.
1.2 Modified and Additional Defined Terms. Section 1.1 of the Credit
Agreement is modified to amend in their entirety (if presently defined in
Section 1.1 of the Credit Agreement) or add (if not presently defined in Section
1.1 of the Credit Agreement) the following defined terms:
"Cash Flow" means, for any period, Net Income, plus
depreciation and amortization, plus Interest Expense, plus increases in
deferred tax accounts, plus
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other non-cash expenses, less extraordinary gains from any sale of
Borrower's assets to the extent such sales are not in the ordinary
course of Borrower's business, less increases in noncurrent assets not
funded with new equity, new long-term Consolidated Indebtedness or
Borrower's own cash that was available at the beginning of such period,
and less dividends and distributions paid to Borrower's shareholders,
in each case, for or during such period.
"Debt Service" is deleted in its entirety.
"EBITDA" for any given period means net income, plus interest
expense, plus income tax expense, plus depreciation expense plus
amortization expense.
"Sixth Amendment" means that certain sixth amendment to
amended and restated credit agreement, dated as of December 31, 2001,
by and between Borrower and U.S. Bank, and includes all amendments,
supplements, exhibits, and modifications to the Sixth Amendment.
"Unfunded Capital Expenditures" means the sum of all purchases
of capital assets or acquisitions of other companies less the sum of
all new financing amounts received or assumed to acquire capital assets
or acquisitions of other companies for the period specified.
1.3 Incorporation of Recitals and Exhibits. The foregoing recitals are
incorporated into this Amendment by reference. All references to "Exhibits"
contained herein are references to exhibits attached to this Amendment, the
terms and conditions of which are made a part of this Amendment for all
purposes.
1.4 Amendment. The Credit Agreement and the other Loan Documents are
hereby amended as set forth herein. Except as specifically provided herein, all
of the terms and conditions of the Credit Agreement and each of the other Loan
Documents and all amendments thereto shall remain in full force and effect
throughout the terms of the Loans and any extensions or renewals thereof.
ARTICLE II. WAIVER OF NONCOMPLIANCE WITH COVENANTS
2.1 Fixed Charge Coverage Ratio. Borrower acknowledges that as of
September 30, 2001, Borrower was not in compliance with a financial covenant
under the Credit Agreement because the Fixed Charge Coverage Ratio for the
Quarter ending September 30, 2001, was less than 1.05:1.00. Subject to the terms
and conditions set forth in this Sixth Amendment, U.S. Bank hereby waives
Borrower's noncompliance as of such date with the financial covenant set forth
in Section 7.17 of the Credit Agreement.
3.1 No Future Waiver. U.S. Bank's agreement to waive the non-compliance
with the financial covenant under the Credit Agreement as provided for herein is
not a waiver of any future noncompliance by Borrower with the financial covenant
set forth in Section 7.17 of the Credit Agreement, nor is it a waiver of
Borrower's noncompliance with any other terms and conditions set forth in the
Credit Agreement. If there shall
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occur or exist any other Event of Default under the Credit Agreement or any
other Loan Document, or if Borrower violates any provisions of this Sixth
Amendment, then Bank shall be entitled to exercise any of its rights and
remedies provided for in the Credit Agreement or any other Loan Document.
ARTICLE III. NEGATIVE COVENANTS
3.1 Fixed Charge Coverage Ratio. Section 7.17 of the Credit
Agreement is hereby amended in its entirety to read as follows:
7.17 Fixed Charge Coverage Ratio. Permit the ratio of (a)
EBITDA minus cash taxes, cash dividends and Unfunded Capital
Expenditures, all for the period in question to (b) the sum of all
required principal payments (on short and long term debt and capital
leases), and interest expense all for the period in question to be less
than 1.00:1 for (i) the immediately preceding quarter (for the period
ending on the last day of the fourth quarter of 2001); (ii) the
immediately preceding two quarters (for the period ending on the last
day of the first quarter of 2002); (iii) the immediately preceding
three quarters (for the period ending on the last day of the second
quarter of 2002); and (iv) the immediately preceding four rolling
quarters (for the period ending on the last day of the third quarter of
2002 and during any fiscal quarter of Borrower thereafter).
ARTICLE IV. CONDITIONS PRECEDENT
U.S. Bank shall have no obligation to modify the terms of the Credit
Agreement as provided in this Amendment unless the following conditions have
been fulfilled to the satisfaction of U.S. Bank:
(a) U.S. Bank shall have received this Amendment, duly executed and
delivered by Borrower.
(b) There shall not then exist any Default or Event of Default
hereunder as of the date hereof.
(c) All representations and warranties of Borrower contained herein or
made in writing in connection herewith shall be true and correct as of the date
hereof.
ARTICLE V. GENERAL PROVISIONS
5.1 Representations and Warranties. Borrower hereby represents and
warrants to U.S. Bank that, to the best knowledge and belief of Borrower, as of
the date of this Amendment, there exists no Default or Event of Default. All
representations and warranties of Borrower contained in the Credit Agreement and
the other Loan Documents, or otherwise made in writing in connection therewith,
are true and correct as of the date of this Amendment. Borrower acknowledges and
agrees that all of Borrower's Indebtedness to U.S. Bank is payable without
offset, defense, or counterclaim.
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5.2 Security. The parties acknowledge and agree that all security
agreements, financing statements, and other Loan Documents creating, perfecting,
or evidencing U.S. Bank's security interest in the Collateral shall remain in
full force and effect and shall secure and shall continue to secure payment and
performance of all Loans and other Indebtedness of Borrower to U.S. Bank.
5.3 Guaranties. The parties hereby acknowledge and agree that all
guaranties now existing or hereafter obtained by U.S. Bank shall remain in full
force and effect, are valid and enforceable in accordance with their terms, and
are not subject to offset, defense, or counterclaim.
5.4 Expenses. Borrower shall reimburse U.S. Bank for all of its
out-of-pocket expenses incurred in connection with this Amendment promptly upon
demand. Such expenses shall include, without limitation, reasonable attorney
fees, examination expenses, and filing fees.
5.5 Counterparts. This Amendment may be executed in one or more
counterparts, each of which shall constitute an original agreement, but all of
which together shall constitute one and the same agreement.
5.6 Statutory Notice. ORAL AGREEMENTS OR ORAL COMMITMENTS TO LOAN
MONEY, EXTEND CREDIT, OR TO FORBEAR FROM ENFORCING REPAYMENT OF A DEBT ARE NOT
ENFORCEABLE UNDER WASHINGTON LAW.
IN WITNESS WHEREOF, U.S. Bank and Borrower have caused this Amendment
to be duly executed by their respective duly authorized officers or agents as of
the date first above written.
REDHOOK ALE BREWERY, INCORPORATED
By: /s/ Xxxxx X. Xxxxxxxxx
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Xxxxx Xxxxxxxxx, Executive Vice
President
U.S. BANK NATIONAL ASSOCIATION
By: /s/ Xxxxxxx X. Xxxxx
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Xxxxxxx X. Xxxxx, Vice President
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By execution of this Amendment, the undersigned Guarantor approves of
the changes to the Credit Agreement set forth herein, agrees to be bound by
Section 4.2 herein, reaffirms its Guaranty, and acknowledges and agrees that its
obligations under its Guaranty are not subject to any defense, offset, or
counterclaim.
REDHOOK OF NEW HAMPSHIRE, INC.
By: /s/ Xxxxx X. Xxxxxxxxx
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Xxxxx Xxxxxxxxx, Executive Vice
President
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