Exhibit 10.97
FIRST AMENDMENT TO COVENANTS AGREEMENT
--------------------------------------
THIS FIRST AMENDMENT TO COVENANTS AGREEMENT (this "Amendment") is made
as of the 26th day of September, 2004, among S&W OF LAS VEGAS, L.L.C., a
Delaware limited liability company, having an address at c/o The Xxxxx &
Wollensky Restaurant Group, Inc., 0000 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000
(the "Borrower"), THE XXXXX & WOLLENSKY RESTAURANT GROUP, INC., having an
address at 0000 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 ("S&W Restaurant Group"),
DALLAS S&W, L.P. ("S&W Dallas" and, together with S&W Restaurant Group, the
"Guarantors"), having an address at c/o The Xxxxx & Wollensky Restaurant Group,
Inc., 0000 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000 and XXXXXX XXXXXXX XXXX XXXXXX
COMMERCIAL FINANCIAL SERVICES, INC., a Delaware corporation, having an office at
0000 Xxxxxxxxxxx Xxxxxx, Xxxxxxxx, Xxx Xxxx 00000 (the "Lender").
W I T N E S S E T H:
- - - - - - - - - -
WHEREAS, the Lender, the Borrower and the Guarantors entered into a
Covenants Agreement and Amendment to Term Loan Agreement dated as of January 30,
2004 (the "Covenants Agreement"); and
WHEREAS, the Lender, the Borrower and the Guarantors wish to modify
Sections 2(c) and 2(e) of the Covenants Agreement on the terms set forth below;
NOW, THEREFORE, in consideration of Ten ($10.00) Dollars and other good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged by each of the parties hereto, and in order to modify the Covenants
Agreement, the parties hereto agree for themselves, their successors and assigns
as follows:
1. Amendment to Financial Covenants. Section 2 of the Agreement,
entitled "Financial Covenants" is modified as follows:
(a) Paragraph 2(c) of the Agreement, entitled "Interest Coverage
Ratio" is amended and restated in its entirety to read as follows:
"(c) Interest Coverage Ratio. Subject to paragraph (e) below,
S&W Restaurant Group shall not permit the ratio of EBIT to
interest expense to be less than: (A) 1.0 to 1.0 as of the
close of each of the fiscal quarters ending September 27, 2004
and January 3, 2005; and (B) 1.5 to 1.0 as of the close of
each fiscal quarter during the fiscal year ending January 2,
2006; and (C) 2.0 to 1.0 as of the close of any fiscal quarter
ending thereafter (in each case, measured on a rolling four
quarter basis). Subject Lease Capital Lease Debt shall be
excluded from the calculations of interest expense and EBIT in
determining the foregoing ratio."
2
(b) The first sentence of Paragraph 2(e) of the Agreement, which
Paragraph is entitled "General" is amended and restated in its entirety to read
as follows:
"All calculations of EBITDA and EBIT will exclude from the
determination of earnings, (a) amounts attributable to
pre-opening expenses associated with new restaurants, which
expenses are approved by the Lender in its reasonable
discretion, (b) operating losses (up to $150,000.00 per new
restaurant) incurred by a new restaurant during the first full
month after the opening of such new restaurant, (c) for the
fiscal quarter ended September 27, 2004, the sum of $525,000
incurred for legal and settlement costs in connection with a
labor dispute, and (d) for the fiscal quarter ended September
27, 2004 and thereafter, non-cash income derived from
amortization of the deferred rent liability for the Subject
Lease (as defined in the First Loan Agreement). For purposes
of determining the Debt Service Coverage Ratio, Senior
Leverage Ratio for each of the fiscal quarters ending
September 27, 2004, January 3, 2005, April 4, 2005, July 4,
2005 and October 3, 2005, calculations of EBITDA and EBIT for
the fiscal quarters December 29, 2003, March 29, 2004 and June
28, 2004 will be determined based on the Company's financial
statements prior to the restatement thereof."
2. Representations and Warranties. The Borrower and each of the
Guarantors represent and warrant to the Lender that to the best of the
Borrower's or the Guarantors' knowledge, as applicable, all of the
representations and warranties made by or on behalf of the Borrower and each of
the Guarantors in the Loan Agreements (as defined in the Covenants Agreement)
and the other Loan Documents (as defined below) are true and correct in all
material respects on and as of the date hereof, and that after giving effect to
the waiver set forth in Section 1 of this Amendment, no Event of Default (as
defined in any of the Loan Agreements) has occurred and is continuing and no
event has occurred which, with notice, lapse of time or both, would constitute
such an Event of Default. As used in the this Amendment, the term "Loan
Agreements" shall mean, collectively, the Loan Agreements as defined in the
Covenants Agreement and that certain Line of Credit Agreement dated as of July
21, 2004 (the "July Agreement") among the Borrower, S&W Restaurant Group, Xxxxx
and Wollensky of Boston, LLC and the Lender.
3. Reaffirmation. The Borrower and the Guarantors hereby confirm and
reaffirm their respective obligations under the Loan Agreements and the Loan
Documents to which each is a party, and all grants of collateral security for
the Loans (as defined in the Covenants Agreement) and, as applicable, for the
"Loan" as defined in the July Agreement.
4. Entire Agreement. This Amendment sets forth the entire understanding
of
3
the parties with respect to the modification to the Covenants Agreement. The
Borrower and the Guarantors acknowledge that no oral or other agreements,
conditions, promises, understandings, representations or warranties exist in
regard to its obligations under, or the subject matter of, this Amendment,
except those specifically set forth herein and therein.
5. Ratification of Covenants Agreement. As specifically modified and
restated herein, all of the terms, covenants, conditions and stipulations
contained in the Covenants Agreement are hereby ratified and confirmed in all
respects, shall continue to apply with full force and effect. References to the
Covenants Agreement in any of other Loan Documents shall hereinafter be deemed
to be references to the Covenants Agreement as amended by this Amendment.
6. No Oral Change. Neither this Amendment nor any provision hereof may
be modified, amended, changed, waived, discharged or terminated orally, but only
by an instrument in writing signed by the party against whom enforcement of the
change, waiver, discharge or termination is sought.
7. Counterparts. This Amendment may be executed in one or more
counterparts each of which shall be an original but all of which when taken
together shall constitute one and the same instrument.
8. Governing Law. This Amendment is and shall be deemed to be a
contract entered into pursuant to the laws of the State of New York and shall in
all respects be governed, construed, applied and enforced in accordance with the
laws of the State of New York.
9. Successors and Assigns. This Amendment is binding upon, and shall
inure to the benefit of, the parties hereto and their respective successors and
assigns.
10. No Joint Venture. Nothing in this Amendment is intended to or shall
be deemed to create any rights or obligations of partnership, joint venture, or
similar association among the parties hereto.
11. Illegality, etc. If any term, covenant, provision or condition of
this Amendment shall be held to be invalid, illegal or unenforceable in any
respect, this Amendment shall be construed without such term, covenant,
provision or condition.
12. Waiver of Jury Trial. The parties hereto hereby irrevocably and
unconditionally waive any and all rights to trial by jury in any action, suit or
counterclaim arising in connection with, out of or otherwise related to this
Amendment.
4
IN WITNESS WHEREOF, the parties have executed this Amendment as of the
day and year first above written.
S&W OF LAS VEGAS, L.L.C.,
a Delaware limited liability company
By: The Xxxxx & Wollensky Restaurant
Group Inc., a Delaware corporation,
its Sole Member
By: /s/ Xxxx X. Xxxxxx
------------------
Name: Xxxx X. Xxxxxx
Title: Chief Financial Oficer
THE XXXXX & WOLLENSKY
RESTAURANT GROUP, INC.,
a Delaware corporation
By: /s/ Xxxx X. Xxxxxx
------------------
Name: Xxxx X. Xxxxxx
Title: Chief Financial Oficer
DALLAS S&W, L.P.,
a Texas limited partnership
By: S&W of Dallas LLC, general partner
By: /s/ Xxxx X. Xxxxxx
------------------
Name: Xxxx X. Xxxxxx
Title: Chief Financial Oficer
XXXXXX XXXXXXX XXXX XXXXXX
COMMERCIAL FINANCIAL SERVICES,
INC., a Delaware corporation
By: /s/ Xxxxxxxxxxx Xxxxxxx
-----------------------
Name: Xxxxxxxxxxx Xxxxxxx
Title: Executive Director
Xxxxx and Wollensky of Boston, LLC joins and confirms the provisions of
paragraphs 3, 4 and 6 above:
XXXXX AND WOLLENSKY OF BOSTON, LLC, a Texas limited partnership
By: Xxxxx & Wollensky Restaurant Group, Inc., Sole Member
By: /s/ Xxxx X. Xxxxxx
-------------------------------
Name: Xxxx X. Xxxxxx
Title: Chief Financial Oficer
5
For Borrower
STATE OF NEW YORK )
)ss.:
COUNTY OF NEW YORK )
On the 11th day of November in the year 2004, before me, the
undersigned, a Notary Public in and for said State, personally appeared Xxxx X.
Xxxxxx, personally known to me or proved to me on the basis of satisfactory
evidence to be the individual whose name is subscribed to the within instrument
and acknowledged to me that he executed the same in his capacity, and that by
his signature on the instrument, the individual, or the person upon behalf of
which the individual acted, executed the instrument.
/s/ Xxxxx X. Xxxxx
-------------------------------
Xxxxx X. Xxxxx
Notary Public
Notarized
For S&W Restaurant Group
STATE OF NEW YORK )
)ss.:
COUNTY OF NEW YORK )
On the 11th day of November in the year 2004, before me, the
undersigned, a Notary Public in and for said State, personally appeared Xxxx X.
Xxxxxx, personally known to me or proved to me on the basis of satisfactory
evidence to be the individual whose name is subscribed to the within instrument
and acknowledged to me that he executed the same in his capacity, and that by
his signature on the instrument, the individual, or the person upon behalf of
which the individual acted, executed the instrument.
/s/ Xxxxx X. Xxxxx
-------------------------------
Xxxxx X. Xxxxx
Notary Public
Notarized
0
Xxx X&X Xxxxxx
XXXXX XX XXX XXXX )
)ss.:
COUNTY OF NEW YORK )
On the 11th day of November in the year 2004, before me, the
undersigned, a Notary Public in and for said State, personally appeared Xxxx X.
Xxxxxx, personally known to me or proved to me on the basis of satisfactory
evidence to be the individual whose name is subscribed to the within instrument
and acknowledged to me that he executed the same in his capacity, and that by
his signature on the instrument, the individual, or the person upon behalf of
which the individual acted, executed the instrument.
/s/ Xxxxx X. Xxxxx
-------------------------------
Xxxxx X. Xxxxx
Notary Public
Notarized
For Xxxxx and Wollensky of Boston, LLC
STATE OF NEW YORK )
)ss.:
COUNTY OF NEW YORK )
On the 11th day of November in the year 2004, before me, the
undersigned, a Notary Public in and for said State, personally appeared Xxxx X.
Xxxxxx, personally known to me or proved to me on the basis of satisfactory
evidence to be the individual whose name is subscribed to the within instrument
and acknowledged to me that he executed the same in his capacity, and that by
his signature on the instrument, the individual, or the person upon behalf of
which the individual acted, executed the instrument.
/s/ Xxxxx X. Xxxxx
-------------------------------
Xxxxx X. Xxxxx
Notary Public
Notarized
7
For Lender
STATE OF NEW YORK )
)ss.:
COUNTY OF NEW YORK )
On the 11th day of November in the year 2004, before me, the
undersigned, a Notary Public in and for said State, personally appeared
Xxxxxxxxxxx Xxxxxxx, personally known to me or proved to me on the basis of
satisfactory evidence to be the individual whose name is subscribed to the
within instrument and acknowledged to me that he executed the same in his
capacity, and that by his signature on the instrument, the individual, or the
person upon behalf of which the individual acted, executed the instrument.
/s/ Eva Xxxxx Xxxxx
-------------------------------
Notary Public
Notarized
8
