FIRST AMENDMENT TO AMENDED AND RESTATED LOAN AGREEMENT
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This First Amendment to Amended and Restated Loan Agreement (this
"Amendment") is dated as of September 14, 1998 by and among PIZZA INN, INC., a
Missouri corporation (the "Borrower"), and XXXXX FARGO BANK (TEXAS), NATIONAL
ASSOCIATION (the "Lender").
R E C I T A L S:
WHEREAS, Borrower and Lender have entered into that certain Amended and
Restated Loan Agreement dated as of August 28, 1997 (as amended, modified or
supplemented from time to time, the "Agreement"), pursuant to which Lender made
revolving credit loans available to Borrower under the terms and provisions
stated therein; and
WHEREAS, Borrower has requested Lender to (a) amend certain provisions of
the Agreement relating to financial covenants, and (c) extend the Termination
Date; and
WHEREAS, Lender is willing to amend the Agreement as hereinafter provided;
and
WHEREAS, Borrower and Lender now desire to amend the Agreement as herein
set forth.
NOW, THEREFORE, in consideration of the premises herein contained and other
good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
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Section I.1 Definitions. Capitalized terms used in this Amendment, to
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the extent not otherwise defined herein, shall have the same meaning as in the
Agreement, as amended hereby.
ARTICLE II
AMENDMENTS
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Section II.1 Amendments to Section 1.1. Effective as of the date
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hereof, Section 1.1 of the Agreement is hereby amended as follows:
(a) The definition of "Funded Debt Ratio" in Section 1.1 of the
Agreement is amended by deleting the phrase "less the amount of any purchases by
the Borrower of its common stock in excess of $800,000 during said period"
appearing at the end of such definition.
(b) The definition of "Termination Date" in Section 1.1 of the
Agreement is amended by deleting the reference to "August 30, 1999" and
substituting therefor "August 30, 2000".
Section II.2 Amendment to Section 10.2. Effective as of the date
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hereof, Section 10.2 of the Agreement is amended in its entirety to read as
follows:
Section 10.2 Leverage Ratio. The Borrower will at all times maintain a
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Leverage Ratio of not greater than (a) 3.25 to 1.00 for the fiscal quarter
ending September 25, 1998, (b) 3.00 to 1.00 for the fiscal quarter ending
December 25, 1998, and (c) 2.75 to 1.00 for the fiscal quarter ending March 26,
1999 and thereafter.
Section II.3 Amendment to Section 10.5. Effective as of the date
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hereof, Section 10.5 of the Agreement is amended and restated in its entirety as
follows:
Section 10.5 Operating Leases. The Borrower will not incur, create,
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assume, or permit to exist, and will not permit any Subsidiary to incur, create,
assume, or permit to exist, any liabilities for payments under any Operating
Leases without the prior written approval of the Bank, which approval shall not
be unreasonably withheld, provided that (i) the Borrower and the Subsidiaries
may incur, create, or assume liabilities for payments under Operating Leases in
an aggregate amount (including taxes, insurance, maintenance, and similar
expenses which the Borrower or any Subsidiary is obligated to pay under any such
Operating Lease) not to exceed Six Million Dollars ($6,000,000) on a
consolidated basis, plus One Million Five Hundred Thousand Dollars ($1,500,000)
per fiscal year commencing with the fiscal year ending in June of 1999, (ii) the
amount of any permitted increase in liabilities under Operating Leases not
incurred in any fiscal year may be carried forward to the next succeeding fiscal
year but not thereafter, and (iii) the aggregate payments of the Borrower and
the Subsidiaries with respect to Operating Leases shall not exceed Two Million
Dollars ($2,000,000) during any fiscal year commencing with the fiscal year
ending in June of 1999.
ARTICLE III
CONDITIONS PRECEDENT
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Section III.1 Conditions. The effectiveness of this Amendment is
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subject to the satisfaction of the following conditions precedent:
(a) Lender shall have received all of the following, each dated (unless
otherwise indicated) the date of this Amendment, in form and substance
satisfactory to Lender:
(i) Amendment. This Amendment, duly executed by Borrower and each
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Guarantor;
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(ii) Second Amended and Restated Revolving Credit Note. A Second Amended
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and Restated Revolving Credit Note in the form of Annex I attached hereto, duly
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executed by Borrower;
(iii) Additional Information. Such additional documents, instruments and
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information as Lender or its legal counsel, Xxxxxxxx Xxxxxxxx & Xxxxxx P.C., may
reasonably request.
(b) The representations and warranties contained herein and in all
other Loan Documents, as amended hereby, shall be true and correct as of the
date hereof as if made on the date hereof.
(c) No Event of Default shall have occurred and be continuing and no
event or condition shall have occurred that with the giving of notice or lapse
of time or both would be an Event of Default.
(d) All corporate proceedings taken in connection with the transactions
contemplated by this Amendment and all documents, instruments, and other legal
matters incident thereto shall be satisfactory to Lender and its legal counsel,
Xxxxxxxx Xxxxxxxx & Xxxxxx P.C.
ARTICLE IV
MISCELLANEOUS
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Section IV.1 Ratifications, Representations and Warranties. Except as
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expressly modified and superseded by this Amendment, the terms and provisions of
the Agreement and the other Loan Documents are ratified and confirmed and shall
continue in full force and effect. Borrower and Guarantors agree that the
representations and warranties contained herein and in all other Loan Documents,
as amended hereby, are true and correct as of, and as if made on, the date
hereof. Borrower, Lender and Guarantors agree that the Agreement as amended
hereby and all other documents executed in connection with the Agreement or this
Amendment to which Borrower or such Guarantor is a party shall continue to be
legal, valid, binding and enforceable in accordance with their respective terms
Section IV.2 Reference to the Agreement. Each of the Loan Documents,
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including the Agreement and any and all other agreements, documents or
instruments now or hereafter executed and delivered pursuant to the terms hereof
or pursuant to the terms of the Agreement as amended hereby, are hereby amended
so that any reference in such Loan Documents to the Agreement shall mean a
reference to the Agreement as amended hereby.
Section IV.3 Expenses of Lender. As provided for in the Agreement,
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Borrower agrees to pay on demand all reasonable cost and expenses incurred by
Lender in connection with the preparation, negotiation, execution of this
Amendment, and the other Loan Documents executed pursuant hereto and any and all
amendments, modifications and supplements thereto including, without limitation,
the reasonable cost of Lender's legal counsel, and all reasonable costs and
expenses incurred by Lender in connection with the enforcement or preservation
of any rights under the Agreement, as amended hereby, or any other Loan
Documents.
Section IV.4 Severability. Any provisions of this Amendment held by court
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of competent jurisdiction to be invalid or unenforceable shall not impair or
invalidate the remainder of this Amendment and the effect thereof shall be
confined to the provisions so held to be invalid or unenforceable.
Section IV.5 Applicable Law. This Amendment and all other Loan Documents
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executed pursuant hereto shall be governed by and construed in accordance with
the laws of the State of Texas.
Section IV.6 Successors and Assigns. This Amendment is binding upon and
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shall enure to the benefit of Lender and Borrowers and their respective
successors and assigns.
Section IV.7 Counterparts. This Amendment may be executed in one or more
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counterparts, each of which when so executed shall be deemed to be an original
but all of which when taken together shall constitute one and the same
instrument.
Section IV.8 Headings. The headings, captions, and arrangements used in
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this Amendment are for convenience only and shall not affect the interpretation
of this Amendment.
Section IV.9 NO ORAL AGREEMENTS. THIS AMENDMENT AND ALL OTHER
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INSTRUMENTS, DOCUMENTS AND AGREEMENTS EXECUTED AND DELIVERED IN CONNECTION
HEREWITH REPRESENT THE FINAL AGREEMENT BETWEEN THE PARTIES, AND MAY NOT BE
CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS
BETWEEN THE PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE
PARTIES.
EXECUTED as of the day and year first above written.
BORROWER:
PIZZA INN, INC.
By: /s/Xxxxxx X. Xxxxxx
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Name: Xxxxxx X. Xxxxxx
Title: Executive Vice President & Chief Operating Officer
LENDER:
XXXXX FARGO BANK (TEXAS), NATIONAL ASSOCIATION
By: /s/Xxxx X. Xxxxxxxx
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Name: Xxxx X. Xxxxxxxx
Title: Vice President
GUARANTORS:
XXXXX REALTY, INC.
By: /s/Xxxxxx X. Xxxxxx
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Name: Xxxxxx X. Xxxxxx
Title: President
R-CHECK, INC.
By: /s/Xxxxxx X. Xxxxxx
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Name: Xxxxxx X. Xxxxxx
Title: President
PIZZA INN OF DELAWARE, INC.
By: /s/Xxxxxx X. Xxxxxx
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Name: Xxxxxx X. Xxxxxx
Title: President
