AMENDMENT AND LIMITED WAIVER
----------------------------
This AMENDMENT AND LIMITED WAIVER (this "Amendment") is
entered into as of March 25, 1998 among DenAmerica Corp., a Georgia corporation
(the "Borrower"), the Banks (as hereinafter defined) and Banque Paribas, as
Agent.
RECITALS
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WHEREAS, Borrower, certain financial institutions (the
"Banks") and the Agent are party to that certain Amended and Restated Credit
Agreement dated as of July 3, 1996, as modified by that certain Limited Consent,
dated as of April 16, 1997, as further modified by that certain Limited Consent,
dated as of June 30, 1997, as further modified by that certain Limited Consent,
dated as of July 31, 1997, as further modified by that certain Limited Waiver,
dated as of August 21, 1997 and as further amended and modified by that certain
Amendment and Limited Consent and Waiver, dated as of September 30, 1997 (the
"September 1997 Amendment") (as amended or modified prior to the date hereof, as
amended and modified hereby and as further amended, supplemented or modified
hereafter from time to time, the "Credit Agreement"); and
WHEREAS, Borrower has requested that the Agent and the Banks
amend, and grant certain consents and waivers with respect to, certain
provisions of the Credit Agreement, all as more fully described herein; and
WHEREAS, the Agent and the Banks have agreed to grant such
consents and waivers upon the terms and conditions set forth herein.
AGREEMENT
---------
NOW, THEREFORE, in consideration of the foregoing and for
other good and valuable consideration, the receipt and adequacy of which are
hereby acknowledged, the parties hereto hereby agree as follows:
Section 1. Definitions Used in this Amendment. Capitalized
terms used herein and not otherwise defined herein shall have the respective
meanings assigned thereto in the Credit Agreement.
Section 2. Amendments to the Credit Agreement. Subject to the
terms and conditions set forth herein, the Credit Agreement is hereby amended as
follows:
(a) Amendments to Definitions. Section 1.1 of the
Credit Agreement is hereby amended by:
(i) deleting the defined terms "Olajuwon Associates,
L.L.C." and "Olajuwon Deferred Purchase Price" in their
entirety as they appear in such Section;
(ii) inserting the parenthetical "(together with all
schedules and exhibits to this Amended Credit Agreement)"
immediately after the words "this Amended Credit Agreement" as
they appear in the first line of the defined term "Loan
Documents" contained in such Section;
(iii) amending and restating the defined term "Term
Loan Maturity Date" in its entirety to read as follows: "Term
Loan Maturity Date" shall mean June 30, 1998."
(iv) adding to such Section, in proper alphabetical
order the following new defined terms:
"Asset Purchase Agreement" means that certain
Asset Purchase Agreement, dated as of January 27, 1998,
among Olajuwon Holdings, Inc., Xxxxxxx Xxxxxxxx and the
Borrower, as amended by that certain First Amendment to
Asset Purchase Agreement, dated as of March 16, 1998,
in the form set forth in Schedule A attached hereto.
"CNL Equipment" means certain equipment owned
by the Borrower and located at the properties
identified on Schedule B hereto.
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"CNL Loan Agreement" means the collective
reference to (i) that certain Balloon Promissory Note,
dated as of October 1, 1997 in the principal amount of
$8,725,000 by Borrower in favor of CNL American
Properties Fund, Inc. ("CNL American"), set forth in
Schedule C attached hereto, (ii) that certain Balloon
Promissory Note, dated as of October 1, 1997 in the
principal amount of $4,500,000 by Borrower in favor of
CNL American, set forth in Schedule D attached hereto,
(iii) that certain Security Agreement, dated as of
October 1, 1997 between Borrower and CNL American, set
forth in Schedule E attached hereto, (iv) that certain
Security Agreement, dated as of October 1, 1997 between
Borrower and CNL American, set forth in Schedule F
attached hereto, (v) that certain Assignment of
Warranties, dated as of October 1, 1997 by Borrower in
favor of CNL American, set forth in Schedule G attached
hereto and (vi) that certain Assignment of Warranties,
dated as of October 1, 1997 by Borrower in favor of CNL
American, set forth in Schedule H attached hereto.
"Olajuwon Notes" means the collective
reference to (i) that certain promissory note in the
maximum principal amount of $1,800,000 in the form of
Schedule I attached hereto delivered by Olajuwon
Holdings, Inc. to Borrower and (ii) that certain
promissory note in the maximum principal amount of
$1,700,000 in the form of Schedule J attached hereto
delivered by Olajuwon Holdings, Inc. to Borrower, in
each case, as partial consideration for the Olajuwon
Sale.
"Olajuwon Sale" means the sale to Olajuwon
Holdings, Inc. of the Borrower's rights in, title to
and interest in the Olajuwon Stores, pursuant to the
terms and conditions set forth in
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the Asset Purchase Agreement and the Sublease
Agreement.
"Olajuwon Stores" means the 71 restaurants
described in Schedule K attached hereto.
"Sublease Agreement" means the collective
reference to (i) that certain Master Sublease
Agreement, dated as of March 25, 1998 between the
Borrower and Olajuwon Holdings, Inc., in the form set
forth in Schedule L hereto and (ii) that certain Lease
Assignment Agreement, dated as of March 25, 1998
between the Borrower and Olajuwon Holdings, Inc., in
the form set forth in Schedule M hereto.
"Wyoming Note" means that certain promissory
note in the maximum principal amount of $400,000, in
the form of Schedule N attached hereto.
"Wyoming Sale" means the sale to Cimarron
Management Company, Inc. of the Borrower's rights in,
title to and interest in the Wyoming Stores, pursuant
to the terms and conditions set forth in the Wyoming
Sale Agreement.
"Wyoming Sale Agreement" means the Asset
Purchase Agreement, dated as of September 26, 1997
among Cimarron Management Company, Inc., Xxxxxxx X.
Xxxxxxxxxxx, Xxxx X. Xxxxxxxxxxx and the Borrower, as
amended by the Amendment No. 1 to Asset Purchase
Agreement, dated as of March 11, 1998, in the form set
forth in Schedule O attached hereto.
"Wyoming Stores" means the 5 restaurants
described in Schedule P attached hereto.
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(b) Repayment of Term Loans. Section 2.1 of the
Credit Agreement is hereby amended by amending and restating the
Payment Dates and installment amounts, in their entirety, as they
appear in such Section to read as follows:
Payment Dates occurring Amount of Installment
----------------------- ---------------------
between the following dates
---------------------------
June 30, 1996 through $833,333
and including December
31, 1996
January 1, 1997 through $1,375,000
and including December
31, 1997
June 30, 1998 The remaining outstanding
principal balance of the
Term Loans
(c) Mandatory Prepayments. Section 2.13 of the Credit
Agreement is hereby amended by:
(i) amending and restating, in its entirety,
clause (iv) of subsection (a) thereof to read as
follows:
(iv) Notwithstanding anything to the contrary
contained in this Section 2.13(a), the Borrower shall
be required to apply the Net Sale Proceeds received in
connection with the Olajuwon Sale as follows: first,
to prepay the Term Loans, in the inverse order of
maturity, together with all accrued and unpaid
interest thereon to and including the date of such
prepayment, in an amount not to exceed $8,250,000,
second, to prepay the outstanding principal amount of
the Subordinated Promissory Note until such
Subordinated Promissory Note shall have repaid in
full, together with all accrued and unpaid interest
thereon and all other amounts outstanding there under,
provided, however, no such prepayment
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shall be made if the amount necessary to pay such
Subordinated Promissory Note in full exceeds
$13,350,000, third, to prepay the Term Loans, in
inverse order of maturity, until such Term Loans shall
have been repaid in full, together with all accrued
and unpaid interest thereon to and including the date
of prepayment and fourth, to prepay the Revolving
Loans until such Revolving Loans shall have been
repaid in full, together with all accrued and unpaid
interest thereon; and
(ii) adding the following new clause (v) to
subsection (a) thereof:
(v) Notwithstanding anything to the contrary
contained in this Section 2.13(a), the Borrower shall
be required to apply the Net Sale Proceeds received
in connection with the Wyoming Sale as follows: first,
to prepay the outstanding amount of principal on the
Term Loans, in the inverse order of maturity, in a
principal amount equal to $300,000 and second, to pay
certain accounts payable allocated to the Wyoming
Stores, in an aggregate amount not exceeding $400,000.
(iii) adding thereto a new subsection (h) to read as
follows:
(h) For each calendar year in which one or
more payments of principal or interest are received
by Borrower or any of its Subsidiaries on the Wyoming
Note or any of the Olajuwon Notes, Borrower shall
apply such amounts on the date such payments are
received as follows: first, to prepay the outstanding
amount of principal on the Term Loans pro rata, in the
inverse order of maturity, and second, to prepay the
Revolving Loans
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until such Revolving Loans shall have been repaid in
full, together with accrued and unpaid interest
thereon.
(d) Indebtedness. Section 7.2 of the Credit Agreement
is hereby amended by (i) deleting the word "and" as it appears at the
end of subsection (g) thereof, (ii) deleting the period as it appears
at the end of subsection (h) thereof, and replacing such period with a
semicolon and the word "and" and (iii) inserting a new subsection (i)
to read as follows:
(i) Indebtedness under the CNL Loan Agreement, less
the amount of any repayment, prepayment or redemption
of any such Indebtedness.
(e) Liens. Section 7.3 of the Credit Agreement is
hereby amended by (i) deleting the word "and" as it appears at the end
of subsection (h) thereof, (ii) deleting the period as it appears at
the end of subsection (i) thereof, and replacing such period with a
semicolon and the word "and" and (iii) inserting a new subsection (j)
to read as follows:
(j) Liens granted to CNL American under the CNL Loan
Agreement to secure the Borrower's obligations
thereunder and which are limited to the CNL
Equipment.
(f) Restrictions on Fundamental Changes. Section
7.4(b) of the Credit Agreement is hereby amended by deleting the
parenthetical "(other than the Olajuwon Associates, L.L.C.)" in its
entirety as it appears in subsection (iii) thereof.
(g) Asset Dispositions. Section 7.5 of the Credit
Agreement is hereby amended by deleting the words "Olajuwon Associates,
L.L.C." contained in subsection (i) thereof in their entirety, and
replacing such words with "Olajuwon Sale and the Wyoming Sale."
(h) Contingent Obligations. Section 7.6 of the Credit
Agreement is hereby amended by (i) deleting the word "and" as it
appears at the end of subsection (a) thereof, (ii) deleting the period
as it appears and the end of subsection (b) thereof and replacing it
with a semicolon and (iii) adding thereto the following new subsection
(c):
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(c) Contingent Obligations comprised of the
Borrower's continuing obligations under (i) the leases
described in the Sublease Agreement, (ii) Section 16(b) of the
Asset Purchase Agreement and (iii) Section 13.1 of the Wyoming
Sale Agreement.
(i) Investments. Section 7.8 of the Credit Agreement
is hereby amended by amending and restating subsection (k) thereof in
its entirety to read as follows:
(k) moneys owed to Borrower under the Wyoming Note
and each of the Olajuwon Notes.
Section 3. Release of Liens. (i) Subject to, and effective
upon, the consummation of the Wyoming Sale, the Agent, for itself and the Banks
and their respective successors and assigns, hereby releases and terminates all
Liens in the Wyoming Stores granted by Borrower or any Subsidiary of Borrower in
favor of the Agent pursuant to any Security Document.
(ii) Subject to, and effective upon, the consummation
of the Olajuwon Sale, the Agent, for itself and the Banks and their respective
successors and assigns, hereby releases and terminates all Liens in the Olajuwon
Stores granted by Borrower or any Subsidiary of Borrower in favor of the Agent
pursuant to any Security Document.
Section 4. Limited Waiver of Defaults or Events of Default.
Subject to the terms and conditions set forth herein, the Agent and the Banks,
as of the date hereof, hereby waive any Default or Event of Default that has
occurred as of the date hereof, solely as a result of any of the following:
(a) Financial Covenants. The failure of Borrower to
comply with the financial covenants set forth in Sections 7.1(a),
7.1(b), 7.1(c), 7.1(d) 7.1(e), 7.1(j) and 7.2(f) of the Credit
Agreement to and including December 31, 1997.
(b) Indebtedness and Liens. The failure of Borrower
to comply with the negative covenants set forth in Sections 7.2 and 7.3
of
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the Credit Agreement as a result of Borrower entering into the
transactions contemplated by the CNL Loan Agreement.
(c) Notice of Default or Litigation. The failure of
Borrower to give notice (prior to the date hereof) to the Agent,
pursuant to Section 6.1(g)(i) of the Credit Agreement, within one
Business Day after an Authorized Officer obtained knowledge of the
occurrence of a Default or Event of Default arising from (i) Borrower's
failure to comply with the covenants set forth in Sections 7.1(a),
7.1(b), 7.1(c), 7.1(d), 7.1(e), 7.1(j), 7.2(f)) of the Credit Agreement
through and including December 31, 1997 and (ii) Borrower's failure to
comply with the covenants set forth in Sections 7.2 and 7.3 with
respect to the transactions contemplated by the CNL Loan Agreement.
(d) Security Documents relating to September 1997
Amendment. The failure of Borrower to deliver to the Agent within 90
days of the closing date of the September 1997 Amendment, each of the
documents required to be delivered by Borrower pursuant to Section 3(o)
of the September 1997 Amendment; provided, however, that in the event
that Borrower shall fail to deliver all of such documents within 30
days from the date hereof, the Agent shall have the right to declare
such Default or Event of Default reinstated as of the date of the
September 1997 Amendment.
Section 5. Conditions to Effectiveness of this Amendment. The
effectiveness of this Amendment is subject to the satisfaction of the following
conditions precedent:
(a) Amendment. This Amendment shall have been duly
executed and delivered by each of the parties hereto.
(b) Proceeds. The Agent shall have received for the
benefit of the Banks, (i) coterminous, with the effectiveness of the
Wyoming Sale, cash proceeds from the Wyoming Sale in an aggregate
principal amount of at least $300,000, to be applied in accordance with
the terms and conditions of the Credit Agreement, as amended hereby and
(ii) coterminous, with the effectiveness of the Olajuwon Sale, cash
proceeds from the Olajuwon Sale in an aggregate principal amount of at
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least $8,250,000, to be applied in accordance with the terms and
conditions of the Credit Agreement, as amended hereby.
(c) Transaction Documents for Wyoming Sale and
Olajuwon Sale. The Agent shall have approved the form and substance of
(i) the Wyoming Sale Agreement and the Wyoming Note and (ii) the Asset
Purchase Agreement, the Sublease Agreement and each of the Olajuwon
Notes.
(d) Delivery of Notes. Borrower shall have executed
and delivered to the Agent the Wyoming Note and each of the Olajuwon
Notes, together with proper endorsements in a form acceptable to the
Agent.
(e) Officer's Certificate. The Agent shall have
received a certificate of an Authorized Officer of Borrower certifying
as to the matters set forth in Sections 6(a) and 6(b) of this
Amendment.
(f) CNL Transactions. By their signatures hereto, the
parties hereto agree and acknowledge that the consents granted by the
Agent and the Banks pursuant to the September 1997 Amendment with
respect to the CNL Equipment Financing (as defined in the September
1997 Amendment), and the sale by Borrower of certain of its personal
property to CNL Maryland (as defined in the September 1997 Amendment)
are no longer effective.
(g) Additional Matters. The Agent shall have received
such other certificates, opinions, documents and instruments relating
to the transactions contemplated hereby as may have been requested by
the Agent or any Bank, in each case, in form and substance satisfactory
to the Agent.
Section 6. Representations and Warranties. Borrower
represents, warrants and covenants to the Agent and the Banks that both before
and after giving effect to this Amendment:
(a) no Default or Event of Default (other than any
Default or Event of Default waived pursuant to the terms hereof) has
occurred and is continuing;
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(b) all of the representations and warranties
contained in the Credit Agreement and in the other Loan Documents
(other than those that expressly speak only as of a different date) are
true and correct;
(c) No order, consent, approval, license,
authorization, or validation of, or filing, recording or registration
with, or exemption by, any Person, including, without limitation, any
governmental or public body or authority, or any subdivision thereof,
that has not been obtained, is required to authorize, or is required in
connection with (i) the execution and delivery by Borrower of this
Amendment and the performance by Borrower of its obligations hereunder
(except as set forth in item 1 of Annex 1 hereto), (ii) the execution
and delivery by Borrower of any of the documents relating to the
Wyoming Sale or the Olajuwon Sale and the performance by Borrower of it
obligations thereunder (except as set forth on Annex 1 hereto), or
(iii) the conveyance by Borrower of the assets to be conveyed in
connection with the Olajuwon Sale or the Wyoming Sale (except as set
forth on Annex 1 hereto); and
(d) No liabilities, direct or contingent, shall be
retained or assumed by Borrower in connection with or as a result of
the Olajuwon Sale or the Wyoming Sale, except (i) in the case of the
Olajuwon Sale, Borrower's continuing obligations under (A) the leases
described in the Sublease Agreement, (B) the Sublease Agreement, (C)
Sections 2.3, 8, 16(b) and 20 of the Asset Purchase Agreement, (D) the
Post-Closing Agreement, dated as of January 27, 1998 between Borrower
and Olajuwon Holdings, Inc., a copy of which is attached hereto as
Annex 3 and (E) the Intercreditor and Subordination Agreement, dated as
of March 25, 1998 among Borrower, Olajuwon Holdings, Inc., Xxxxxxx X.
Xxxxxxxx and Global Alliance Finance Company, L.L.C., a copy of which
is attached hereto as Annex 4 and (ii) in the case of the Wyoming Sale,
Borrower's continuing obligations under Sections 13.1 and 13.3 of the
Wyoming Sale Agreement and under each of the lease agreements relating
to the Wyoming Stores.
Section 7. Limited Consent. Notwithstanding the terms and
conditions of Section 7.2 and 7.6 of the Credit Agreement, Borrower is hereby
permitted to enter into certain substitution and put agreements (collectively,
the "Put Agreements") in connection with the CNL Improvement Financing and the
CNL Fee Property Financing (as each such term is defined in the September
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1997 Amendment), pursuant to which Borrower is required to purchase certain real
and personal property described in such Put Agreements (collectively, the "Put
Properties") upon the occurrence of certain events described in such Put
Agreements, provided, that Borrower has the ability under the Put Agreements to
provide a comparable property in substitution of any Put Property and provided,
further, that the purchase price paid by Borrower for the Put Properties shall
not exceed $4,000,000 in the aggregate. By their signatures hereto, the parties
hereto agree and acknowledge that the consents granted by the Agent and the
Banks pursuant to the September 1997 Amendment with respect to Borrower entering
into a certain substitution and put agreement relating to the properties
described on Schedule 3(n) thereto are no longer effective.
Section 8. Miscellaneous.
(a) Effect; Ratification. The amendments, consents
and waivers set forth herein are effective solely for the purposes set
forth herein and shall be limited precisely as written, and shall not
be deemed to (i) be a consent to any amendment, consent or modification
of any other term or condition of the Credit Agreement or of any other
instru ment or agreement referred to therein; or (ii) prejudice any
right or remedy which the Agent or the Banks may now have or may have
in the future under or in connection with the Credit Agreement or any
other instrument or agreement referred to therein. Each reference in
the Credit Agreement to "this Amended Credit Agreement", "herein",
"hereof" and words of like import and each reference in the other Loan
Documents to the "Agreement" or the "Credit Agreement" shall mean the
Credit Agree ment as amended hereby. This Amendment shall be construed
in connection with and as part of the Credit Agreement and all terms,
conditions, representations, warranties, covenants and agreements set
forth in the Credit Agreement and each other instrument or agreement
referred to therein, except as herein amended or waived, are hereby
ratified and confirmed and shall remain in full force and effect.
(b) Loan Documents. This Amendment is a Loan Document
executed pursuant to the Credit Agreement and shall (unless otherwise
expressly indicated herein) be construed, administered and applied in
accordance with the terms and provisions thereof.
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(c) Costs, Fees and Expenses. Borrower agrees to pay
all reasonable costs, fees and expenses (including the reasonable fees
and expenses of counsel to the Agent) incurred in connection with the
preparation, execution and delivery of this Amendment as required
pursuant to the Credit Agreement.
(d) Headings Descriptive. The headings of the several
Sections and Subsections of this Amendment are inserted for convenience
only and shall not in any way affect the meaning or construction of any
provision or term of this Amendment.
(e) Counterparts. This Amendment may be executed in
any number of counterparts, each such counterpart constituting an
original and all of which when taken together shall constitute one and
the same instrument.
(f) Severability. Any provision contained in this
Amendment that is held to be inoperative, unenforceable or invalid in
any jurisdiction shall, as to that jurisdiction, be inoperative,
unenforceable or invalid without affecting the remaining provisions of
this Amendment in that jurisdiction or the operation, enforceability or
validity of such provision in any other jurisdiction.
(g) GOVERNING LAW. THIS CONSENT SHALL BE GOVERNED BY,
AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE INTERNAL LAWS OF
THE STATE OF ILLINOIS.
(h) WAIVER OF TRIAL BY JURY. TO THE EXTENT PERMITTED
BY APPLICABLE LAW, EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES
ALL RIGHT OF TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM
ARISING OUT OF OR IN CONNECTION WITH THIS CONSENT OR ANY OTHER LOAN
DOCUMENT OR ANY MATTER ARISING HEREUNDER OR THEREUNDER.
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IN WITNESS WHEREOF, the parties hereto have caused this
Amendment to be executed by their respective duly authorized officers as of the
date first written above.
DENAMERICA CORP.
By: /s/ Xxxx Xxxxx
-----------------------------
Name: Xxxx Xxxxx
Its: Vice President
BANQUE PARIBAS,
individually and as Agent
By: /s/ Xxxxxx X. Xxxxxx
-----------------------------
Name: Xxxxxx X. Xxxxxx
Its: Director
By: /s/ Xxxxx X. Xxxxxx
-----------------------------
Name: Xxxxx X. Xxxxxx
Its: Vice President
FIRST SOURCE FINANCIAL LLP
By First Source Financial, Inc.
Its Agent/Manager
By: /s/ Xxxxx X. Xxxxxx
-----------------------------
Name: Xxxxx X. Xxxxxx
Its: Senior Vice President
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LASALLE NATIONAL BANK
By: /s/ Xxxxxxx Xxxxxxxxx
-----------------------------
Name: Xxxxxxx Xxxxxxxxx
Its: Commercial Loan Officer
PILGRIM AMERICAN PRIME RATE
TRUST
By: Pilgrim America Investments, Inc.
As its Investment Manager
By: /s/ X. Xxxxxx
-----------------------------
Name: X. Xxxxxx
Its: S V P
KZH-SOLEIL CORPORATION
By: /s/ Xxxxxxxx Xxxxxx
-----------------------------
Name: Xxxxxxxx Xxxxxx
Its: Authorized Agent
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