EXECUTION COPY
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REVOLVING CREDIT AGREEMENT
dated as of May 8, 2000
among
PLANET HOLLYWOOD INTERNATIONAL, INC.,
and
THE BORROWERS LISTED ON ANNEX I HERETO
AS BORROWERS,
THE CIT GROUP/BUSINESS CREDIT, INC.,
WLR RECOVERY FUND L.P.,
and
THE FINANCIAL INSTITUTIONS PARTY HERETO,
AS LENDERS,
and
THE CIT GROUP/BUSINESS CREDIT, INC.,
AS AGENT
THIS AGREEMENT IS SUBJECT TO AN INTERCREDITOR AND SUBORDINATION AGREEMENT DATED
AS OF MAY 8, 2000 BY AND AMONG THE CIT GROUP/BUSINESS CREDIT, INC., FOR ITSELF
AND AS AGENT, WLR RECOVERY FUND L.P., WILMINGTON TRUST COMPANY, AS AGENT, UNITED
STATES TRUST COMPANY OF NEW YORK, AS JUNIOR SUBORDINATED TRUSTEE AND THE OTHER
PERSONS AND ENTITIES SIGNATORY THERETO (THE "INTERCREDITOR AGREEMENT"), WHICH
MATERIALLY AFFECTS CERTAIN PAYMENT RIGHTS, SUBORDINATES CERTAIN OBLIGATIONS AND
CERTAIN SECURITY INTERESTS AND LIENS, AND LIMITS RIGHTS TO ENFORCEMENT OF THE
PARTIES TO THIS AGREEMENT. ALL PERSONS OR OTHER ENTITIES WHICH AT ANY TIME HOLD
INDEBTEDNESS HEREUNDER OR WHICH IS SECURED HEREBY ARE BOUND BY THE TERMS OF THE
INTERCREDITOR AGREEMENT, WHICH WILL BE MADE AVAILABLE UPON REQUEST TO ANY PARTY
HERETO.
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TABLE OF CONTENTS
Page
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ARTICLE I DEFINITIONS; CONSTRUCTION........................................................................1
1.01. Certain Definitions...........................................................................1
1.02. Construction.................................................................................23
1.03. Accounting Principles........................................................................23
ARTICLE II THE CREDITS................................................................................... 24
2.01. Revolving Credit Loans.......................................................................24
2.02. Notes........................................................................................24
2.03. Notice of Borrowing; Making of Loans.........................................................24
2.04. Reduction of Current Commitment; Mandatory Prepayment; Optional Prepayment...................27
2.05. Interest Rate................................................................................29
2.06. Interest Payment Dates.......................................................................30
2.07. Maturity Date................................................................................30
2.08. Payments.....................................................................................30
2.09. Use of Proceeds..............................................................................33
2.10. Eurodollar Rate Not Determinable; Illegality or Impropriety..................................33
2.11. Reserve Requirements; Capital Adequacy Circumstances.........................................33
2.12. Indemnity; Agent Duty to Change Eurodollar Loan Office.......................................35
2.13. Sharing of Setoffs...........................................................................36
2.14. Continuation and Conversion of Loans.........................................................36
2.15. Taxes........................................................................................37
2.16. Joint and Several Liability..................................................................39
2.17. Inter-Lender Arrangements....................................................................39
2.18. Equity Contributions.........................................................................39
ARTICLE III LETTERS OF CREDIT.............................................................................39
3.01. Letters of Credit............................................................................39
3.02. Participations...............................................................................43
ARTICLE IV BORROWING BASE.................................................................................44
4.01. Condition of Lending and Assisting in Establishing or Opening Letters of Credit..............44
4.02. Mandatory Prepayment.........................................................................44
4.03. Rights and Obligations Unconditional.........................................................44
4.04. Borrowing Base Certificate...................................................................45
4.05. General Provisions...........................................................................45
ARTICLE V SECURITY........................................................................................45
5.01. Collateral...................................................................................45
5.02 Trademarks....................................................................................46
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ARTICLE VI CONDITIONS OF EFFECTIVENESS, LETTER OF CREDIT ISSUANCE AND LENDING.............................46
6.01. Conditions Precedent to Effectiveness........................................................46
6.02. Conditions Precedent to Loans and Letters of Credit..........................................51
ARTICLE VII REPRESENTATIONS AND WARRANTIES................................................................52
7.01. Organization, Good Standing, Etc.............................................................52
7.02. Authority and Authorization..................................................................53
7.03. Execution and Binding Effect.................................................................53
7.04. Governmental Approvals.......................................................................53
7.05. Absence of Conflicts.........................................................................54
7.06. Subsidiaries.................................................................................54
7.07. Litigation...................................................................................54
7.08. Financial Condition; Historical Statements...................................................54
7.09. Compliance with Law, Etc.....................................................................54
7.10. ERISA........................................................................................55
7.11. Taxes, Etc...................................................................................55
7.12. Full Disclosure..............................................................................56
7.13. Operating Lease Obligations; Existing Liens; Unpaid Rent.....................................56
7.14. Environmental Matters........................................................................56
7.15. Schedules....................................................................................57
7.16. Insurance....................................................................................57
7.17. Use of Proceeds..............................................................................57
7.18. Financial Accounting Practices, Etc..........................................................57
7.19. No Material Adverse Effect...................................................................58
7.20. Real Property; Leases........................................................................58
7.21. Location of Bank Accounts....................................................................59
7.22. No Event of Default..........................................................................59
7.23. Capitalized Leases...........................................................................59
7.24. Inventory and Memorabilia....................................................................59
7.25. Collateral...................................................................................59
7.26. Tradenames...................................................................................59
7.27. Intellectual Property........................................................................59
7.28. Regulation T, U or X.........................................................................60
7.29. Nature of Business...........................................................................60
7.30. Adverse Agreements, Etc......................................................................60
7.31. Holding Company and Investment Company Acts..................................................60
7.32. Permits, Etc.................................................................................61
7.33. Priority; Title..............................................................................61
7.34. Labor Relations; Collective Bargaining Agreements............................................61
7.35. Loan Documents...............................................................................61
7.36. Solvency.....................................................................................62
7.37. Ownership of Planet Hollywood Memorabilia, Inc. and the Memorabilia..........................62
7.38. Corporate Structure..........................................................................62
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7.39. Delivery of Authenticity Documents...........................................................62
7.40. Material Contracts...........................................................................62
7.41. [Intentionally omitted]......................................................................62
7.42. TSP Agreement................................................................................62
7.43. Additional Representations and Warranties....................................................63
ARTICLE VIII AFFIRMATIVE COVENANTS........................................................................63
8.01. Reporting Requirements.......................................................................63
8.02. Compliance with Laws, Etc....................................................................67
8.03. Preservation of Existence, Etc...............................................................68
8.04. Keeping of Records and Books of Account......................................................68
8.05. Inspection Rights............................................................................68
8.06. Maintenance of Properties, Etc...............................................................69
8.07. Maintenance of Insurance.....................................................................69
8.08. Environmental................................................................................70
8.09. Further Assurances...........................................................................71
8.10. Financial Accounting Practices, Etc..........................................................71
8.11. Cash Management System.......................................................................72
8.12. Store Openings and Closings..................................................................73
8.13. Memorabilia and Inventory....................................................................73
8.14. Change in Collateral; Collateral Records.....................................................73
8.15. Leases.......................................................................................74
8.16. Landlord and Warehouse Waivers...............................................................74
8.17. Authenticity Documents.......................................................................74
8.18 TSP Agreement................................................................................74
ARTICLE IX NEGATIVE COVENANTS.............................................................................75
9.01. Liens, Etc...................................................................................75
9.02. Indebtedness.................................................................................76
9.03. Guarantees, Etc..............................................................................77
9.04. Merger, Consolidation, Sale of Assets, Etc...................................................77
9.05. Change in Nature of Business.................................................................78
9.06. Loans, Advances and Investments, Etc.........................................................78
9.07. Lease Obligations............................................................................79
9.08. Dividends, Prepayments, Etc..................................................................79
9.09. Transactions with Affiliates.................................................................80
9.10. Sale Policies................................................................................80
9.11. Environmental................................................................................80
9.12. ERISA........................................................................................80
9.13. Subsidiaries.................................................................................81
9.14. Capital Expenditures.........................................................................81
9.15. Federal Reserve Regulations..................................................................81
9.16. Limitation on Plan of Reorganization Payments................................................81
9.17. Inactive Guarantors..........................................................................81
9.18. Negative Pledge..............................................................................81
9.19. Foreign Entities.............................................................................82
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9.20. Note Maturity Date...........................................................................82
ARTICLE X DEFAULTS........................................................................................82
10.01. Events of Default...........................................................................82
10.02. Consequences of an Event of Default.........................................................85
10.03. Deposit for Letters of Credit...............................................................86
10.04. Certain Remedies............................................................................86
ARTICLE XI MISCELLANEOUS..................................................................................86
11.01. Holidays....................................................................................86
11.02. Records.....................................................................................87
11.03. Amendments and Waivers......................................................................87
11.04. No Implied Waiver; Cumulative Remedies......................................................87
11.05. Notices.....................................................................................88
11.06. Expenses; Taxes; Attorneys' Fees; Indemnification...........................................88
11.07. Application.................................................................................90
11.08. Severability................................................................................90
11.09. Governing Law...............................................................................90
11.10. Prior Understandings........................................................................90
11.11. Duration; Survival..........................................................................90
11.12. Counterparts................................................................................90
11.13. Assignments; Participations.................................................................91
11.14. Successors and Assigns......................................................................93
11.15. Confidentiality.............................................................................93
11.16. Waiver of Jury Trial........................................................................94
11.17. Right of Setoff.............................................................................94
11.18. Headings....................................................................................94
11.19. Forum Selection and Consent to Jurisdiction.................................................94
ARTICLE XII THE AGENT.....................................................................................95
12.01. Appointment.................................................................................95
12.02. Nature of Duties............................................................................96
12.03. Rights, Exculpation, Etc....................................................................96
12.04. Reliance....................................................................................97
12.05. Indemnification.............................................................................97
12.06. Lenders Individually........................................................................97
12.07. Successor Agent.............................................................................98
12.08. Collateral Matters..........................................................................98
ARTICLE XIII OTHER MATTERS...............................................................................100
13.01. Members and TSP Membership Interest........................................................100
13.02. Affirmative Covenant.......................................................................100
13.03. Negative Covenant..........................................................................100
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Exhibit A - Form of Note
Exhibit B - Form of Security Agreement
Exhibit C - Form of Pledge Agreement
Exhibit D - Form of Guarantor Security Agreement
Exhibit E - Form of Guaranty
Exhibit F - [Intentionally Omitted]
Exhibit G - Form of Letter of Credit Application
Exhibit H - Form of Borrowing Base Certificate
Exhibit I - Form of Assignment and Acceptance
Exhibit J - Form of Credit Card Depository Account Agreement
Exhibit J-1 - Form of Payment Direction Letter
Exhibit K - Form of Notice Letter to Depository Banks
Exhibit L - Form of Depository Account Agreement
Exhibit M - Form of Section 2.15(c) Tax Certificate
Exhibit N - Form of Notice of Borrowing
Exhibit O - Form of Blocked Account Agreement
Schedule 1.01(A) - List of Active Guarantors
Schedule 1.01(B) - Locations of Inventory and Memorabilia as of the Closing Date
Schedule 1.01(C) - List of UCC-1 Filing Locations
Schedule 1.01(D) - List of Foreign Entities
Schedule 1.01(E) - List of Guarantors
Schedule 1.01(F) - List of Inactive Guarantors
Schedule 1.01(G) - Revolving Credit Commitments
Schedule 1.01(H) - Credit Card Agreements
Schedule 3.01(c) - Existing Letters of Credit
Schedule 5.02 - PH Trademarks
Schedule 6.01(u) - Warehouse Waivers Required by the Closing Date
Schedule 7.06 - U.S. Subsidiaries
Schedule 7.07 - Litigation
Schedule 7.10 - Employee Plans
Schedule 7.13 - Operating Lease Obligations
Schedule 7.14 - Environmental Matters
Schedule 7.16 - Insurance
Schedule 7.20(a) - Real Property
Schedule 7.20(b) - Leases
Schedule 7.21 - Bank Accounts
Schedule 7.26 - Tradenames
Schedule 7.34 - Collective Bargaining Agreements
Schedule 7.42 - TSP Information
Schedule 7.38 - Corporate Structure Chart
Schedule 7.40 - Material Contracts
Schedule 8.11 - State Tax Payments
Schedule 8.12 - Store Closing Locations
Schedule 8.13 - Permitted Memorabilia and Inventory Locations
Schedule 8.16 - Landlord, Warehouse and Franchisee Waiver Locations
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Schedule 9.01 - Existing Liens
Schedule 9.02 - Permitted Indebtedness
Schedule 9.06 - Existing Investments
Schedule 9.09 - Transactions Contemplated by the Plan of Reorganization
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EXECUTION COPY
REVOLVING CREDIT AGREEMENT
THIS REVOLVING CREDIT AGREEMENT, dated as of May 8, 2000,
among PLANET HOLLYWOOD INTERNATIONAL, INC., a Delaware corporation ("Planet
Hollywood"), the Borrowers signatory hereto listed on Annex I hereto (together
with Planet Hollywood, and jointly and severally, the "Borrowers" and
individually, each a "Borrower"), THE CIT GROUP/BUSINESS CREDIT, INC. ("CIT"),
WLR RECOVERY FUND L.P. ("WLR"), and the financial institutions from time to time
party hereto (collectively, the "Lenders" and each individually, a "Lender"),
and CIT, as agent for the Lenders under this Revolving Credit Agreement and as
Memorabilia Agent (as hereinafter defined) hereunder (in such capacity, the
"Agent").
RECITALS
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WHEREAS, the Borrowers have requested that the Lenders provide
the Borrowers with a $15,000,000 revolving credit facility, including a
$5,000,000 subfacility for the issuance of letters of credit (the "Facility"),
for working capital purposes and, subject to the terms and conditions set forth
herein, the Lenders have agreed to provide the Facility.
In consideration of the mutual covenants herein contained and
intending to be legally bound hereby, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS; CONSTRUCTION
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1.01. Certain Definitions. In addition to other words and
terms defined elsewhere in this Agreement, as used herein the following words
and terms shall have the following meanings, respectively, unless the context
hereof otherwise clearly requires:
"Accountant's Opinion" shall have the meaning given that term
in Section 8.01(a) hereof.
"Active Guarantor" and "Active Guarantors" shall mean (i) the
direct or indirect existing Subsidiaries of the Borrowers (other than Inactive
Guarantors) listed on Schedule 1.01(A) annexed hereto, and (ii) any other entity
that, after the Closing Date, becomes a direct or indirect U.S. Subsidiary of
any Borrower, has business operations or assets located within the United States
of America, and executes a Guaranty and Guarantor Security Agreement in
accordance with the terms of this Agreement.
"Affiliate" of a Person shall mean any other Person (other
than a Subsidiary) which, directly or indirectly, is in control of, is
controlled by, or is under common control with, such Person. For purposes of
this definition (i) "control" of a Person means the power, directly or
indirectly, either to (A) vote twenty percent (20%) or more of the securities
having ordinary voting power for the election of directors of such Person, or
(B) direct or cause the direction of
the management and policies of such Person whether by contract or otherwise (no
Lender is an Affiliate of any Borrower).
"Agent" shall have the meaning set forth in the introductory
paragraph to this Agreement.
"Agent Account" shall mean an account in the name of the Agent
designated to the Borrowers from time to time into which the Borrowers shall
make all payments to the Agent under this Agreement.
"Agent Advances" shall have the meaning given that term in
Section 12.08 hereof.
"Agent Fees" shall have the meaning given that term in Section
2.08(h) hereof.
"Agreement" shall mean this Revolving Credit Agreement, as
amended, modified, supplemented or restated from time to time.
"Agreement Regarding Leases" means the Agreement between
Xxxxxx Xxxx and the Purchasers under the Note Purchase Agreement dated as of the
date hereof, with respect to the Employment Agreement and certain leases.
"Asset" means any asset, property, right or other interest of
any Borrower or Subsidiary as of, and from time to time after, the Closing Date.
"Asset Disposition Proceeds" means the aggregate amount of Net
Proceeds received by or on behalf of the Borrower or any Subsidiary from Asset
Sales (including Asset Sales in respect of Core Assets and non-Core Assets).
"Asset Sale" means the sale, assignment, lease, transfer or
other disposition by any Borrower or any Subsidiary to any Person other than the
Borrower or any of their wholly-owned Subsidiaries of any Asset; provided,
however, that the repayment to any Borrower or any Subsidiary of any loan or
advance permitted under Section 9.06 hereof or the redemption by any Borrower or
any Subsidiary of any Permitted Investment at maturity shall not be an Asset
Sale.
"Assignment and Acceptance" shall mean an assignment and
acceptance entered into by a Lender and an assignee, and accepted by the Agent,
substantially in the form of Exhibit I hereto.
"Authenticity Documents" shall mean all documents and other
written evidence, including, without limitation, computer files, establishing
the authenticity of the Memorabilia or evidencing the chain of title of an item
or items of Memorabilia.
"Availability" shall mean the amount equal to (i) the lesser
of (A) the Borrowing Base and (B) the Current Commitment, minus (ii) the sum of
(A) the aggregate outstanding principal amount of all Loans, (B) the Letter of
Credit Exposure and (C) the Reserves.
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"Bank" shall mean The Chase Manhattan Bank, its successors or
any other bank designated by the Agent to the Borrowers from time to time that
is reasonably acceptable to the Borrowers.
"Bankruptcy Court" shall mean the United States Bankruptcy
Court for the District of Delaware.
"Bay Harbour" shall mean Bay Harbour Management, L.C.
"BH Notes" shall mean the notes issued under the Note Purchase
Agreement.
"Blocked Account" shall mean the account in the name of Agent
at the Blocked Account Bank.
"Blocked Account Agreement" shall mean an agreement, in form
and substance satisfactory to the Agent, between the Blocked Account Bank and
the Agent delivered to the Agent pursuant to Section 8.11 hereof, as such
Agreement may be modified and supplemented and in effect from time to time.
"Blocked Account Bank" shall mean a bank mutually acceptable
to the Borrowers and the Agent (which on the date hereof shall be SunTrust Bank,
Central Florida, National Association).
"Board" means the Board of Governors of the Federal Reserve
System of the United States of America.
"Book Value" shall mean, as to any (x) Inventory in respect of
which such amount is to be determined, the lower of (a) the cost of such
Inventory (as reflected in the ledgers of the Borrowers), or (b) the market
value of such Inventory; both cost and market value being determined in
accordance with GAAP calculated on the first-in, first-out basis, or (y)
Memorabilia in respect of which such amount is to be determined, the value
carried on the date hereof on the books and records of Planet Hollywood
Memorabilia, Inc. or Planet Hollywood.
"Borrower" and "Borrowers" shall have the meaning given that
term in the introductory paragraph to this Agreement.
"Borrowers' Account" shall have the meaning given that term in
Section 2.08(a) hereof.
"Borrowing Base" shall mean (i) ninety percent (90%) of
Eligible Credit Card Receivables plus (ii) fifty percent (50%) of the Book Value
of the Eligible Inventory but not in excess of the Inventory Sublimit, plus
(iii) eighty percent (80%) of the "desktop" appraised forced liquidation value
of such Eligible Memorabilia, but not in excess of the Memorabilia Sublimit
minus the Reserves.
"Borrowing Base Certificate" shall have the meaning given that
term in Section 4.04(a) hereof.
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"Business Day" shall mean any day other than a Saturday,
Sunday or other day on which banking institutions are authorized or obligated to
close in New York, New York; provided, however, that with respect to the
borrowing, payment, conversion to or continuation of Eurodollar Loans, Business
Day shall also mean a day on which dealings in Dollars are carried on in the
interbank eurodollar market where the eurodollar and foreign currency and
exchange operations in respect of the Bank's eurodollar loans are then being
conducted.
"Capitalized Lease" shall mean any lease which is required
under GAAP to be capitalized on the balance sheet of the lessee.
"Capitalized Lease Obligations" shall mean the aggregate
amount which is required under GAAP to be reported as a liability on the balance
sheet of a Person as lessee under a Capitalized Lease.
"Cash Concentration Account" shall mean the account maintained
by the Borrowers in the name of Planet Hollywood at Suntrust Bank, Central
Florida, National Association.
"Casualty" shall mean damage to, destruction or loss of or
other casualty with respect to any of the Mortgaged Property.
"CIT" shall have the meaning given that term in the
introductory paragraph to this Agreement.
"Closing Date" shall mean the date on which the conditions set
forth in Section 6.01 hereof shall be satisfied.
"Code" shall mean the Internal Revenue Code of 1986, as
amended, and any successor statute of similar import. References to sections of
the Code shall be construed also to refer to any successor sections.
"Collateral" shall mean all assets and other property
interests of any kind or nature whether now existing or hereafter acquired as
more fully described in the Security Documents.
"Commitment Letter" shall mean that certain letter agreement,
dated January 18, 2000, by and between Planet Hollywood and CIT.
"Condemnation" means any actual or threatened condemnation,
taking or exercise of the power of eminent domain or similar action or
proceeding.
"Condemnation Proceeds" means, at any time, any award or
payment paid or payable by reason of any Condemnation, whether from the exercise
of the right of Condemnation or any transfer made in lieu thereof or any injury
to in decrease in value of any property in connection with a Condemnation,
including all amounts paid pursuant to any agreement with any condemning
authority that has been made in settlement of any proceeding relating to a
Condemnation and any interest earned on such award, payment or amounts, less the
reasonable costs and expenses (including reasonable attorney's fees and
expenses) of the Borrowers, any
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Subsidiary and the Agent in collecting such award payment or amounts, which
costs and expenses shall be paid out of such award, payment or amounts.
"Confirmation Order" shall mean that certain order of the
Bankruptcy Court, dated January 21, 2000, confirming the Plan of Reorganization,
as the same may be amended from time to time.
"Consolidated Subsidiary" of a Person at any time shall mean
those Subsidiaries or other Affiliates of such Person whose accounts are or
should in accordance with GAAP be consolidated with those of such Person.
"Core Assets" means any of the following Assets: Planet
Hollywood copyrights and globe design and stylized lettering trademarks, classes
42 and 25; the investment of any Borrower or any Subsidiary in the Planet
Hollywood restaurant facilities located in Orlando, Florida, London, England,
Paris, France, Las Vegas, Nevada, 0000 Xxxxxxxx, Xxx Xxxx (currently Official
All Star Cafe restaurant), Myrtle Beach, South Carolina, Euro Disney, France,
Cannes, France, Atlantic City, New Jersey, Washington, D.C., San Antonio, Texas,
St. Louis, Missouri, Dallas, Texas, Atlanta, Georgia, Miami Beach, Florida
(currently Official All Star Cafe restaurant); Joint Ventures (excluding Times
Square Partners, ECE de S.A., C.V., Planet Hollywood Asia Pte, Ltd. and
PlanetHollywood Xxxx.xxx, Inc.); and Memorabilia reasonably necessary to operate
the foregoing Core Assets.
"Credit Card Agreements" or "Credit Card Agreement" shall mean
those agreements listed on Schedule 1.01(H) hereto, as amended from time to time
in accordance with the terms of this Agreement.
"Credit Card Depository Account Agreement" shall have the
meaning given that term in subsection 6.01(v) hereof.
"Credit Card Obligor" shall mean any of American Express
Travel Related Services Company, Inc., Master Card, VISA, Diners Club, Discover,
and, after the Closing Date, any other Person that the Agent deems reasonably
acceptable in its sole discretion; provided, however, that on the Closing Date
the Borrowers shall (i) notify each of the above entities (and after the Closing
Date, the credit card obligors subsequently approved as aforesaid) and inform
such Person in writing of the Agent's security interest in the Receivables due
to any of the Borrowers from such Person and direct such Person to remit all
payments with respect to such Receivables directly to the Blocked Account, such
notice and direction to be substantially in the form of Exhibit J-1 hereto (each
a "Payment Direction Notice"), and (ii) deliver a Credit Card Bank Depository
Agreement executed by such Person.
"Credit Extension" shall mean (a) the making of any Loan by a
Lender or the Agent on behalf of the Lenders or (b) the issuance, increase in
the Stated Amount, or extension of the expiration date, of any Letter of Credit
which the Agent or any Lender assists the Borrowers in opening or establishing.
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"Current Commitment" shall mean the lesser of $15,000,000 or
the Reduced Commitment.
"Default Rate" shall have the meaning set forth in subsection
2.08(d) hereof.
"Depository Accounts" shall mean the lock-box or blocked
depository accounts maintained by the Borrowers when required pursuant to
Section 8.11 hereof for the collection of the cash of the Borrowers and the
proceeds from the sale of the Inventory or Memorabilia of the Borrowers.
"Depository Account Agreement" shall mean each agreement,
substantially in the form of Exhibit L hereto, among a Depository Bank, the
Borrowers, and the Agent delivered to the Agent when required pursuant to
Section 8.11 hereof, as each such Agreement may be modified and supplemented and
in effect from time to time.
"Depository Bank" shall mean each financial institution at
which a Depository Account is maintained.
"Designated Borrowing Officer" shall mean the Financial
Officer or treasurer of Planet Hollywood, or such other officer as shall be
designated from time to time in writing by Planet Hollywood to the Agent.
"Designated Financial Officer" shall mean the Financial
Officer of Planet Hollywood.
"Disbursement Account" shall mean the deposit account in the
name of the Borrowers maintained at a bank in the United States of America
designated by the Borrowers to the Agent into which there shall be deposited
proceeds of Loans and funds disbursed to the Borrowers by the Agent.
"Dollar", "Dollars" and the symbol "$" shall mean lawful money
of the United States of America.
"Early Termination Fee" shall have the meaning set forth in
subsection 2.04(c) hereof.
"Eligible Credit Card Receivables" shall mean, as of the date
of determination thereof, Receivables of any Borrower or any Guarantor payable
in Dollars and deemed by the Agent in the exercise of its discretion to be
eligible for inclusion in the calculation of the Borrowing Base. Without
limiting the foregoing, unless otherwise approved in writing by the Agent, none
of the following shall be deemed to be Eligible Credit Card Receivables:
(i) Receivables that have been outstanding for more than five
(5) Business Days from the date of sale;
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(ii) Receivables not owned solely by the Borrowers or the
Guarantors or with respect to which the Borrowers or the Guarantors do not have
good, valid and marketable title thereto;
(iii) Receivables which the Agent determines in its reasonable
commercial judgment to be uncertain of collection; and
(iv) Receivables not subject to a perfected first-priority
security interest in favor of the Agent on behalf of the Lenders.
"Eligible Inventory" shall mean finished goods Inventory of
any Borrower or any Guarantor (excluding Pro-Player blanks, guard lines, and
accessories) which at the time of determination meets all the following
qualifications:
(i) it is lawfully owned by a Borrower or a Guarantor and not
subject to any Lien (other than Permitted Liens) and it is not held on
consignment and may be lawfully sold;
(ii) it is (i) located in a Borrower's or a Guarantor's retail
locations listed on Schedule 1.01(B) hereto, or (ii) located in other locations
in the continental United States of America as the Agent shall have approved in
writing from time to time, which approval shall be given when the Agent has
caused a UCC financing statement to be filed with respect to such location
(unless one is previously in effect) and upon Planet Hollywood providing the
Agent with evidence, reasonably satisfactory to the Agent, of the absence of any
Liens (other than Permitted Liens) on any Inventory of a Borrower or a Guarantor
located in such locations; and
(iii) it is determined in the reasonable commercial judgment
of the Agent to be, when taken as a whole, substantially similar in quality and
mix to the Inventory maintained by a Borrower or a Guarantor in recent
historical operations prior to the Closing Date; provided, however, that the
Agent shall be entitled to impose a reserve in an amount it believes (determined
in the reasonable commercial judgment of the Agent) to be necessary or
appropriate on account of discounted or outlet inventory, and such amount shall
constitute a Reserve hereunder.
"Eligible Memorabilia" shall mean Memorabilia that at the time
of determination meets all of the following qualifications:
(i) it is identified in the Memorabilia Report which lists
Memorabilia, such Memorabilia Report to be dated no later than the Closing Date
and updated weekly by a Memorabilia Change Report (such update to reflect any
Memorabilia bought, sold, transferred or moved from any place where it is
located on the Closing Date to any other location, unless the aggregate of all
such Memorabilia bought, sold, transferred or moved has a Book Value at any time
of less than $50,000);
(ii) it is owned by Planet Hollywood Memorabilia, Inc.;
-7-
(iii) it is at a location within the United States of America
where the Agent has (x) filed a UCC-1 financing statement, with such locations
as of the date hereof listed on Schedule 1.01(C) hereto, and (y) a perfected
first priority lien with respect thereto;
(iv) the Authenticity Documents (if Authenticity Documents
exist for each such item of Memorabilia) with respect to which are in the
possession of the Memorabilia Agent;
(v) it complies with the representations, warranties and
covenants relating to the Memorabilia contained in the Loan Documents; and
(vi) it is not subject to any contractual limitation that
would affect the Lenders' ability to sell such Memorabilia pursuant to the
exercise of any remedies under any Loan Document.
"Employee Savings Plan" shall mean that certain qualified cash
or deferred arrangement plan administered pursuant to Section 401(k) of the
Code.
"Employment Agreement" shall mean that certain employment
agreement dated on or about the date hereof between Planet Hollywood and Xxxxxx
Xxxx.
"Environmental Actions" shall mean any complaint, summons,
citation, notice, directive, order, claim, litigation, investigation,
proceeding, judgment, letter or other communication from any Governmental
Authority or any third party involving a Release (i) from or onto any of the
properties presently or formerly owned or leased by any Borrower, or (ii) from
or onto any facilities which received Hazardous Materials from any Borrower, or
involving any violation of any Environmental Law.
"Environmental Law" shall mean all federal, state and local
laws, statutes, ordinances and regulations, now or hereafter in effect relating
to the regulation and protection of human health, safety, the environment and
natural resources. Environmental Laws include but are not limited to the
Comprehensive Environmental Response, Compensation and Liability Act of 1980, as
amended (42 U.S.C.ss.9601 et seq.) ("CERCLA"); the Hazardous Material
Transportation Act, as amended (49 U.S.C.ss.180 et seq.); the Resource
Conservation and Recovery Act, as amended (42 U.S.C.ss.6901 et seq.) ("RCRA");
the Toxic Substance Control Act, as amended (15 U.S.C.ss.2601 et seq.); the
Clean Air Act, as amended (42 U.S.C.ss.7401 et seq.); the Federal Water
Pollution Control Act, as amended (33 U.S.C.ss.1251 et seq.); and their state
and local counterparts or equivalents.
"Environmental Liabilities and Costs" shall mean all
liabilities, monetary obligations (including any and all remedial or clean-up
costs but excluding ordinary course compliance costs), Remedial Actions, losses,
damages, punitive damages, consequential damages, treble damages, costs and
expenses (including all reasonable fees, disbursements and expenses of counsel,
expert and consulting and costs of investigation and feasibility studies),
fines, penalties, sanctions and interest incurred as a result of any
Environmental Action relating to any environmental condition, violation of
Environmental Law, Remedial Actions or a Release
-8-
of Hazardous Materials from or onto (i) any property presently or formerly owned
by any Borrower, or (ii) any facility which received Hazardous Materials
generated by any Borrower.
"Environmental Lien" shall mean any Lien securing
Environmental Liabilities and Costs incurred by a Governmental Authority.
"ERISA" shall mean the Employee Retirement Income Security Act
of 1974, as amended, and any successor statute of similar import. References to
sections of ERISA shall be construed also to refer to any successor sections.
"ERISA Affiliate" shall mean any (i) corporation which is a
member of the same controlled group of corporations (within the meaning of
Section 414(b) of the Code) as the Borrowers, (ii) partnership or other trade or
business (whether or not incorporated) under common control (within the meaning
of Section 414(c) of the Code) with the Borrowers, or (iii) member of the same
affiliated service group (within the meaning of Section 414(m) of the Code) as
any Borrower, any corporation described in clause (i) above or any partnership
or trade or business described in clause (ii) above.
"Eurodollar Base Rate" shall mean, with respect to a
Eurodollar Loan for the relevant Interest Period, the rate per annum for
deposits in Dollars for a period equal to the Interest Period quoted by the
British Banker's Association as set forth on Dow Xxxxx Markets Service (formerly
known as Telrate) (or appropriate successor or, if the British Banker's
Association or its successor ceases to provide such quotes, a comparable
replacement determined by the Agent) display page 3750 (or such other display
page on the Dow Xxxxx Markets Service system as may replace display page 3750)
at approximately 11:00 a.m., New York City time, two (2) Business Days prior to
the commencement of the applicable Interest Period (rounded upwards, if
necessary to the next higher 1/100th of one percent (.01%), in the approximate
amount of the relevant Eurodollar Loan and having a maturity equal to such
Interest Period. If, for any reason, such rate is not available, then
"Eurodollar Base Rate" shall mean, with respect to a Eurodollar Loan for the
relevant Interest Period, the rate per annum determined by the Agent to be the
rate at which deposits in Dollars are offered by the Bank to first-class banks
in the interbank eurodollar market where the eurodollar and foreign currency and
exchange operations in respect of its eurodollar loans are then being conducted
at approximately 11:00 a.m., New York City time, two (2) Business Days prior to
the first day of such Interest Period, in the approximate amount of the relevant
Eurodollar Loan and having a maturity equal to such Interest Period.
"Eurodollar Loan" shall mean a Loan bearing interest at the
Eurodollar Rate.
"Eurodollar Rate" means with respect to each day during each
Interest Period pertaining to a Eurodollar Loan, a rate per annum determined for
such day in accordance with the following formula (rounded upward to the nearest
1/100th of one percent (.01%)):
Eurodollar Base Rate
--------------------
1.00 - Reserve Requirements
-9-
"Events of Default" shall mean any of the Events of Default
described in Section 10.01 hereof.
"Excluded Asset Sale" means an Asset Sale described in and
permitted by clauses of Section 9.04(b)(i), (ii), (iv), (v) and (vi) hereof.
"Facility" shall have the meaning given that term in the
RECITALS to this Agreement.
"Facility Fee" shall have the meaning given that term in
Section 2.08(g) hereof.
"Federal Emergency Management Agency" shall mean that certain
agency of government of the United States of America known as the Federal
Emergency Management Agency.
"Financial Officer" shall mean, with respect to each Borrower,
that individual designated from time to time by the Board of Directors or
governing body performing like functions of such Borrower to be the chief
financial officer or treasurer of such Borrower (and individuals designated from
time to time by the Board of Directors or governing body performing like
functions of such Borrower to act in lieu of the chief financial officer or the
treasurer).
"Flood Zone" shall mean any area designated by the Federal
Emergency Management Agency as a special flood hazard area (Zone A or Zone V).
"Foreign Entity" and "Foreign Entities" shall mean any
Subsidiary that is organized under the laws of a jurisdiction other than the
United States of America (consisting of each State thereof and the District of
Columbia). All Foreign Entities existing as of the Closing Date are listed on
Schedule 1.01(D) hereto.
"GAAP" shall mean generally accepted accounting principles as
such principles shall be in effect in the United States of America at the
relevant date.
"Governmental Authority" shall mean any nation or government,
any federal, state, city, town, municipality, county, local or other political
subdivision thereof or thereto and any department, commission, board, bureau,
instrumentality, agency or other entity exercising executive, legislative,
judicial, regulatory or administrative functions of or pertaining to government.
"Guarantee" of or by any Person shall mean any obligation of
such Person guaranteeing any Indebtedness of any other Person (the "primary
obligor"), directly or indirectly through an agreement (i) to purchase or pay
(or advance or supply funds for the purchase or payment of) such Indebtedness or
to purchase (or to advance or supply funds for the purchase of) any security for
the payment of such Indebtedness, (ii) to purchase property, securities or
services for the purpose of assuring the owner of such Indebtedness against
loss, or (iii) to maintain working capital, equity capital or other financial
statement condition or liquidity of the primary obligor so as to enable the
primary obligor to pay such Indebtedness; provided, however, that the
-10-
term Guarantee shall not include endorsements for collection or deposit, in
either case in the ordinary course of business.
"Guarantor" and "Guarantors" shall mean (i) the direct or
indirect existing Subsidiaries of the Borrowers listed on Schedule 1.01(E)
annexed hereto, and (ii) any other entity that, after the Closing Date, becomes
a direct or indirect existing U.S. Subsidiary of any Borrower, and executes a
Guaranty and Guaranty Security Agreement in accordance with the terms of this
Agreement.
"Guarantor Security Agreement" shall mean the Guarantor
Security Agreement substantially in the form of Exhibit D hereto, made by the
Guarantors in favor of the Agent for the benefit of the Lenders, as amended,
modified, or supplemented from time to time.
"Guaranty" shall mean a guaranty containing the joint and
several obligations of the Guarantor substantially in the form of Exhibit E
hereto made by the Guarantor in favor of the Agent for the benefit of the
Lenders, as amended, modified or supplemented from time to time.
"Hazardous Materials" shall mean (i) any element, compound or
chemical that is defined, listed or otherwise classified as a solid waste,
contaminant, pollutant, toxic pollutant, hazardous substance, extremely
hazardous substance, toxic substance, hazardous waste, or special waste under
any Environmental Law, (ii) petroleum and its refined fractions, (iii) any
polychlorinated biphenyls, (iv) any flammable, explosive or radioactive
materials, and (v) any asbestos-containing materials.
"Hospitality" shall mean Planet Hospitality Holdings, Inc., a
Florida Corporation.
"Inactive Guarantor" and "Inactive Guarantors" shall mean (i)
the direct or indirect existing Subsidiaries of the Borrowers listed on Schedule
1.01(F) annexed hereto, and (ii) any other entity that, after the Closing Date,
becomes a direct or indirect U.S. Subsidiary of any Borrower, has no business
operations (other than those operations that directly relate to maintaining
corporate existence) or assets (unless less than $50,000), and executes a
Guaranty and Guaranty Security Agreement in accordance with the terms of this
Agreement.
"Indebtedness" shall mean as to any Person (i) indebtedness
for borrowed money; (ii) indebtedness for the deferred purchase price of
property or services (other than current trade payables incurred in the ordinary
course of business and payable in accordance with customary practices); (iii)
indebtedness evidenced by bonds, debentures, notes or other similar instruments
(other than performance, surety and appeal or other similar bonds arising in the
ordinary course of business); (iv) obligations and liabilities secured by a Lien
upon property owned by such Person, whether or not owing by such Person and even
though such Person has not assumed or become liable for the payment thereof; (v)
obligations and liabilities of the type otherwise referred to in this definition
directly or indirectly Guaranteed by such Person; (vi) obligations or
liabilities created or arising under any conditional sales contract or other
title retention agreement with respect to property used and/or acquired by such
Person, even though the rights and remedies of the lessor, seller and/or lender
thereunder are limited to repossession of such property; (vii) Capitalized Lease
Obligations; (viii) all liabilities in respect of letters of credit,
-11-
acceptances and similar obligations created for the account of such Person; and
(ix) net liabilities of such Person under interest rate cap agreements, interest
rate swap agreements, foreign currency exchange agreements and other hedging
agreements or arrangements calculated on a basis satisfactory to the Agent and
in accordance with accepted practice.
"Indemnified Parties" shall have the meaning given that term
in Section 11.06 hereof.
"Insurance Proceeds" means, at any time, all proceeds or
payments to which any Borrower or any Subsidiary may be or become entitled under
any of the insurance policies and any and all unearned premiums accrued,
accruing or to accrue under any insurance policies and all proceeds of the
conversion, voluntary or involuntary, of any of the foregoing into cash or
liquidated claims, plus (i) the amount of any deductibles under such policies
and (ii) any interest earned on such proceeds, payments or amounts and less
(iii) the reasonable costs and expenses of the Borrower or any Subsidiary and
the Agent in collecting such proceeds, payments or amounts, which costs and
expenses shall be paid out of such proceeds, payments or amounts.
"Inter-Lender Agreement" shall mean that certain intercreditor
agreement dated the date hereof by and among CIT and WLR reflecting their
respective agreements concerning the making of loans hereunder and the
allocation of payments and proceeds among them, as the same may be amended,
modified or supplemented from time to time.
"Intercreditor Agreement" shall mean that certain
Intercreditor Agreement, dated of even date herewith among the Agent on behalf
of the Lenders hereunder, the Note Agent, as agent on behalf of the Note Holders
existing as of the Closing Date under the Note Purchase Agreement, the PIK
Trustee, as Indenture Trustee under the PIK Indenture and consented to by the
PIK Holders signatory thereto, in form and substance satisfactory to the Lenders
establishing, among other things, lien and payment priority.
"Interest Period" shall mean, with respect to any Eurodollar
Loan the period commencing on the borrowing date for, or the date of any
continuation of or conversion to, such Eurodollar Loan, as the case may be, and
ending one (1), two (2), three (3) or six (6) months thereafter as the Borrowers
may elect in the applicable notice given to the Agent pursuant to Section
2.03(a) or Section 2.14, as appropriate; provided, however, that (i) any
Interest Period that would otherwise end on a day that is not a Business Day
shall be extended to the next succeeding Business Day, unless such Business Day
falls in another calendar month, in which case such Interest Period shall end on
the next preceding Business Day; (ii) any Interest Period that begins on the
last Business Day of a calendar month or on a day for which there is no
numerically corresponding day in the calendar month at the end of such Interest
Period shall end on the last Business Day of the applicable calendar month; and
(iii) no Interest Period for any Loan shall end after the Maturity Date.
Interest shall accrue from and include the first date of an Interest Period, but
exclude the last day of such Interest Period.
"Inventory" shall mean all goods and merchandise of the
Borrowers including, but not limited to, all raw materials, work in process,
finished goods, materials and supplies of every nature used or usable in
connection with the shipping, storing, advertising or sale of such goods
-12-
and merchandise, whether now owned or hereafter acquired and all such property,
the sale or disposition of which would give rise to accounts receivable or cash.
"Inventory Sublimit" shall mean $5,000,000 or an amount equal
to the Current Commitment if such Current Commitment is less than $5,000,000.
"L/C Notice" shall have the meaning given that term in Section
3.01(b).
"Law" shall mean any law (including common law), constitution,
statute, treaty, regulation, rule, ordinance, order, injunction, writ, decree or
award of any Governmental Authority.
"Leases" shall mean any lease of real property to which any
Borrower or Guarantor is a party as lessee or lessor.
"Lenders" shall have the meaning given that term in the
introductory paragraph to this Agreement.
"L/C Indemnitors" and "L/C Indemnitor" shall have the meaning
given that term in Section 3.01(a) hereof.
"Letter of Credit" shall have the meaning given that term in
Section 3.01(a) hereof.
"Letter of Credit Application" shall have the meaning given
that term in subsection 3.01(a) hereof.
"Letter of Credit Cash Collateral Account" shall mean the
deposit account maintained at the Bank or such other bank as the Agent may
select, and be under the sole dominion and control of the Agent; provided,
however, that, at a Borrower's request, the funds contained in such deposit
account may be invested in Permitted Investments (which may be maintained and
renewed so long as there has been no acceleration hereunder).
"Letter of Credit Exposure" shall mean, at any time, the sum
at such time of (a) the aggregate amount of all Unreimbursed Draws under Letters
of Credit (whether or not such Letters of Credit are then outstanding) and (b)
the aggregate Undrawn Letter of Credit Availability under all outstanding
Letters of Credit.
"Letter of Credit Fee" shall have the meaning given that term
in Section 2.08(f) hereof.
"Letter of Credit Guaranty" shall mean the guaranty delivered
by either CIT or WLR to the Letter of Credit Issuer or other agreement between
either CIT or WLR and the Letter of Credit Issuer, guaranteeing or making other
arrangements with respect to the Borrowers' reimbursement obligations with
respect to Letters of Credit under a reimbursement agreement, Letter of Credit
Application or other like document.
-13-
"Letter of Credit Issuer" shall mean the issuer of the Letters
of Credit, which shall initially be either The Chase Manhattan Bank or Bear
Xxxxxxx Custodial Trust Co.; provided, however, that, the Letter of Credit
Issuer may be replaced with an issuer acceptable to the Agent and Planet
Hollywood if (i) such substitute issuer is a Lender, and (ii) such substitute
issuer and the Agent agree upon the mechanics and documentation with respect to
such substitution, which mechanics and documentation shall be reasonably
acceptable to the Agent.
"Lien" shall mean any mortgage, deed of trust, pledge, lien,
security interest, charge or other encumbrance or security arrangement of any
nature whatsoever, including but not limited to any conditional sale or title
retention arrangement, and any assignment, deposit arrangement or lease intended
as, or having the effect of, security.
"Loan" or "Loans" shall mean any and all loan or loans made by
the Lenders or by the Agent on behalf of the Lenders to the Borrowers or made as
a result of charges made to the Borrowers' Account, in each case pursuant to the
terms of this Agreement.
"Loan Documents" shall have the meaning given that term in the
definition of "Related Documents" set forth in this Section 1.01.
"Majority Lenders" shall mean, at any time, Lenders whose Pro
Rata Shares aggregate at least fifty one percent (51%); (it being understood
that on the Closing Date, the Lenders consist only of CIT and WLR, each having a
fifty percent (50%) interest and that determinations, when one Lender does not
agree with the other, are made under the Inter-Lender Agreement).
"Material Adverse Effect" shall mean a material adverse effect
upon (i) the business, operations, condition (financial or otherwise),
properties, Assets or performance of Planet Hollywood or Planet Hollywood
Memorabilia, Inc. individually or the Borrowers as a whole, (ii) the ability of
Planet Hollywood or Planet Hollywood Memorabilia, Inc. individually or the
Borrowers and the Active Guarantors as a whole to perform their obligations
hereunder or under any other Related Document in accordance with their terms,
(iii) the legality, validity or enforceability of this Agreement or any Related
Document, or (iv) saleability or the value of the Memorabilia taken as a whole,
as determined by a third party appraiser acceptable to the Agent in its sole
discretion.
"Material Contracts" shall mean any and all contracts,
instruments, guaranties, licenses or other arrangements to which the Borrower or
any Guarantor is a party as to which the breach, nonperformance, cancellation or
failure to renew by any party thereto would or could reasonably be expected to
have a Material Adverse Effect.
"Maturity Date" shall have the meaning given that term in
Section 2.01 hereof.
"Memorabilia" shall mean (i) all memorabilia, collectibles,
souvenirs, keepsakes or any other tangible personal property (and Authenticity
Documents related thereto) owned by any Borrower or any Guarantor the market
value of which is to any extent derived from any association with (A) a
celebrity, entertainer or athlete or any other person reasonably understood
-14-
to be a celebrity, entertainer or athlete, or (B) any motion picture, television
program, series of television programs or sports or entertainment event, and
(ii) all memorabilia, collectibles, souvenirs or keepsakes recognized as such by
the Agent, to or in which any Borrower or any Guarantor has a right of ownership
(including, without limitation, all items at any time appearing on the
Memorabilia Report and any Memorabilia Change Report).
"Memorabilia Agent" shall mean The CIT Group/Business Credit,
Inc. or any successor memorabilia agent.
"Memorabilia Change Report" shall have the meaning given that
term in Section 8.01(f).
"Memorabilia Report" shall mean the master report listing all
items of Memorabilia generated by a computer program maintained by Planet
Hollywood which identifies the Memorabilia by item number as the same is
updated, amended or supplemented from time to time.
"Memorabilia Sublimit" shall mean $10,000,000.
"Minority Lenders" shall have the meaning given that term in
Section 11.03(b).
"Multiemployer Plan" shall mean a "multiemployer plan" as
defined in Section 3(37) of ERISA and subject to Title IV of ERISA which is, or
within the immediately preceding six (6) years was, contributed (or required to
be contributed) to by the Borrowers or any ERISA Affiliate.
"Net Cash Proceeds" means with respect to any Asset Sale or
multiple Asset Sales to one Person or a group of related Persons, any aggregate
payments of cash or Cash Equivalents received by any Borrower or any Subsidiary
from or in respect of any such Asset Sale(s), net of repayment of Indebtedness
secured by a Permitted Lien on the Asset which is the subject of the Asset Sale
having a priority senior to the priority of the Lien of the Agent on the Asset
subject to such Asset Sale and also net of reasonable direct out-of-pocket
expenses and customary fees of such sale(s) and net of taxes paid (or
anticipated to be paid and that are escrowed for such purpose); provided,
however, that no sales commissions or other fees in connection with any such
sale(s) shall be paid to any Affiliate of any Borrower or any Subsidiary. "Net
Cash Proceeds" shall include all payments or other distributions to any Borrower
or any Subsidiary of cash or property in respect of the Membership Interest.
"Net Proceeds" means with respect to any Asset Sale or
multiple Asset Sales to one person or a group of related Persons, the sum of all
Net Cash Proceeds and all non-cash proceeds received by any Borrower or any
Subsidiary from or in respect of any such Asset Sale(s).
"Note Agent" shall mean Wilmington Trust Company, solely in
its capacity as agent on behalf of the Note Holders pursuant to the Note
Purchase Agreement.
-15-
"Note Holders" shall mean the purchasers from time to time of
any of the BH Notes, including Bay Harbour.
"Note Purchase Agreement" shall mean that certain Note
Purchase Agreement, dated of even date herewith, pursuant to which the Purchaser
(as defined therein) has committed to make loans secured by a second priority
lien in the Collateral, as amended, modified, supplemented or restated from time
to time.
"Notes" shall mean the promissory notes of the Borrowers
executed and delivered to the Lenders under this Agreement and substantially in
the form of Exhibit A hereto, as modified or restated from time to time and any
promissory note or notes issued in exchange or replacement thereof, including
all extensions, renewals, refinancings or refundings thereof in whole or part.
"Notice Letter" shall have the meaning given that term in
Section 6.01(w) hereof.
"Notice of Borrowing" shall have the meaning given that term
in Section 2.03(a) hereof.
"Obligations" shall mean all indebtedness, obligations and
liabilities of the Borrowers and the Guarantors collectively or any Borrower or
Guarantor individually to any Lender or the Agent incurred under or related to
this Agreement, the Notes, any Guaranty, or any other Related Document, whether
such indebtedness, obligations or liabilities are direct or indirect, secured or
unsecured, joint or several, absolute or contingent, due or to become due,
whether for payment or performance, now existing or hereafter arising, including
without limitation those which are described in either of the following clauses
(i) or (ii):
(i) All indebtedness, obligations (including Reimbursement
Obligations) and liabilities of any nature whatsoever, including amounts due
under Section 11.06 hereof and similar agreements contained in the other Related
Documents, from time to time arising under or in connection with or evidenced or
secured by this Agreement, the Notes, any Guaranty, the Letters of Credit or any
other Related Document, including, but not limited to, the principal amount of
Loans outstanding, together with interest thereon (including, without
limitation, all interest that accrues after the commencement of any case,
proceeding or other action relating to the bankruptcy, insolvency or
reorganization of one or more of the Borrowers and/or the Guarantors, whether or
not a claim for post-filing interest is allowed in such proceeding), the amount
of the Letter of Credit Exposure, together with interest thereon and all
expenses, fees and indemnities hereunder or under any other Related Document.
Without limitation, such amounts include all Loans and interest thereon and the
amount of all Letter of Credit Exposure whether or not such Loans were made or
any Letters of Credit to which such Letter of Credit Exposure relates were
issued or created, as the case may be, in compliance with the terms and
conditions hereof or in excess of any Lender's obligation to lend and arrange
for the issuance of Letters of Credit or any Lender's obligation to participate
therein. If and to the extent any amounts in any account (including the Agent
Account, the Letter of Credit Cash Collateral Account, the Depository Accounts,
the Blocked Account or otherwise) constituting Collateral are applied to
Obligations hereunder, and any Lender or the Agent is subsequently obligated to
return or repay
-16-
any such amounts to any Person for any reason, the amount so returned or repaid
shall be deemed a Loan hereunder and shall constitute an Obligation.
(ii) All indebtedness, obligations and liabilities from time
to time arising under or in connection with any account from time to time
maintained by any Borrower with any Lender or the Agent, including but not
limited to all reimbursement obligations, service charges and interest in
connection with any overdrafts or returned items from time to time arising under
or in connection with any such account, or arising under or in connection with
any investment services, cash management services or other services from time to
time performed by any Lender or the Agent pursuant to or in connection with this
Agreement or any other Related Document.
"Office" when used in connection with the Agent shall mean its
office located at 1211 Avenue of the Americas, Xxx Xxxx, Xxx Xxxx 00000 or at
such other office or offices of the Agent as may be designated in writing from
time to time by the Agent to the Borrowers and when used in connection with the
Bank or the Letter of Credit Issuer shall mean the office of such entity
designated in writing from time to time by the Agent to the Borrowers.
"Operating Lease Obligations" shall mean all obligations and
indebtedness of the Borrowers and their respective Subsidiaries in respect of
leases of property (whether real, personal or mixed) other than Capitalized
Lease Obligations.
"Other Taxes" shall have the meaning given that term in
Section 2.15.
"Payment Direction Notice" shall have the meaning given that
term in the definition of "Credit Card Obligor".
"PBGC" shall mean the Pension Benefit Guaranty Corporation or
any successor thereto.
"Permitted Investments" shall mean: (a) direct obligations of
the United States of America or of any agency thereof or obligations guaranteed
as to principal and interest by the United States of America or of any agency
thereof, in either case maturing not more than one hundred eighty (180) days
from the date of acquisition thereof by such Person; (b) deposit accounts with
or certificates of deposit issued by any bank or trust company organized under
the laws of the United States of America or any state thereof and having
capital, surplus and undivided profits of at least $500,000,000, maturing not
more than ninety (90) days from the date of acquisition thereof by such Person;
(c) commercial paper rated A-1 or better or P-1 or better by Standard & Poor's
Corporation ("S&P") or Xxxxx'x Investors Services, Inc. ("Moody's"),
respectively, maturing not more than ninety (90) days from the date of
acquisition thereof by such Person; and (d) Investments in money market funds
rated AAAm or AAAm-G by S&P and Aaa by Moody's.
"Permitted Liens" shall have the meaning given that term in
Section 9.01.
"Permitted PIK Note Payments" shall mean any payment of
principal or interest required to be made under the PIK Notes but only to the
extent that the Borrowers have at the
-17-
time such payment is due and payable, on a consolidated basis, readily available
cash plus Availability (as determined by the Agent in its reasonable judgment)
of at least $25,000,000.
"Permitted BH Note Payments" shall mean (i) interest at the
rate of fourteen percent (14%) per annum, and (ii) principal, interest, fees and
expenses at the times and in the amounts permitted to be paid pursuant to the
terms of the Intercreditor Agreement.
"Person" shall mean an individual, corporation, partnership,
limited liability company, limited liability partnership, trust, unincorporated
association, joint venture, joint-stock company, government (including political
subdivisions), Governmental Authority or agency, or any other entity.
"PH Trademarks" shall mean the trademarks listed on Schedule
5.02 hereof.
"PIK Indenture" shall mean that certain indenture, dated of
even date herewith, among Planet Hollywood, as issuer, the Guarantors, and the
PIK Trustee, as trustee, pursuant to which the PIK Notes were issued, as
amended, modified, supplemented or restated from time to time.
"PIK Holders" shall mean the holders of the PIK Notes, and the
third lienholder with respect to the Collateral.
"PIK Notes" shall mean the 10% Secured Deferrable Interest
Notes Due 2005 issued pursuant to the PIK Indenture, as amended, modified,
supplemented or restated from time to time.
"PIK Trustee" shall mean United States Trust Company of New
York (including its successors and assigns), as trustee under the PIK Indenture
pursuant to which the PIK Notes were issued, and the third lienholder with
respect to the Collateral.
"Plan" shall mean an employee benefit plan defined in Section
3(3) of ERISA (other than a Multiemployer Plan) in respect of which any Borrower
or any ERISA Affiliate is, or within the immediately preceding six (6) years
was, an "employer" as defined in Section 3(5) of ERISA, or in respect of which
any Borrower or any ERISA Affiliate has any liability under ERISA.
"Plan of Reorganization" shall mean that certain First Amended
Joint Plan of Reorganization of Planet Hollywood International, Inc. and certain
of its Subsidiaries, dated December 13, 1999, as amended, restated, supplemented
or otherwise modified, and as confirmed by the Confirmation Order.
"Planet Hollywood" shall have the meaning given that term in
the RECITALS to this Agreement.
"Pledge Agreement" shall mean the Pledge Agreement
substantially in the form of Exhibit C hereto by such Borrowers and Guarantors
that are pledgors thereunder in favor of the Agent for the benefit of the
Lenders, as amended, modified or supplemented from time to time.
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"Potential Default" shall mean any event or condition which,
with notice or passage of time, or any combination of the foregoing, would
constitute an Event of Default.
"Prime Loan" shall mean a Loan bearing interest at the Regular
Rate.
"Prime Rate" shall mean the interest rate per annum publicly
announced from time to time by the Bank in New York, New York as its Prime Rate,
such interest rate to change automatically from time to time effective as of the
announced effective date of each change in the Prime Rate. The Prime Rate is not
intended to be the lowest rate of interest charged by the Bank to its borrowers.
"Prior L/C Collateral" shall mean existing cash collateral for
letters of credit issued and outstanding as of the date of the Closing Date.
"Pro Rata Share" shall mean, with respect to any Lender, a
fraction (expressed as a percentage), the numerator of which shall be the amount
of such Lender's Revolving Credit Commitment and the denominator of which shall
be the aggregate amount of all of the Lenders' Revolving Credit Commitments, as
adjusted from time to time in accordance with the provisions of Section 11.13
hereof; provided, however, that, if the Revolving Credit Commitments have been
terminated, the numerator shall be the unpaid amount of such Lender's Loans and
its interest in the Letter of Credit Exposure and the denominator shall be the
aggregate amount of all unpaid Loans and Letter of Credit Exposure.
"Receivables" shall mean, with respect to any Credit Card
Obligor, the amount owed by such Credit Card Obligor to the Borrowers under a
charge account agreement arising from sale of merchandise or services by the
Borrowers.
"Reduced Commitment" shall mean any reductions in the Current
Commitment pursuant to Section 2.04(a)(i) or (a)(ii).
"Region III" shall mean Planet Hollywood (Region III), Inc., a
Florida corporation.
"Register" shall have the meaning given that term in Section
11.13(c) hereof.
"Regular Rate" shall mean, for any day, the Prime Rate for
such day plus one percent (1%) per annum.
"Reimbursement Obligation" shall mean the obligation of the
Borrowers to reimburse the Agent or the Lenders for amounts payable by the Agent
or the Lenders under a Letter of Credit Guaranty in respect of any payments
made, together with interest thereon and all fees and expenses related thereto.
"Related Documents" or "Loan Documents" shall mean this
Agreement, the Security Documents, the Notes, the Letters of Credit, each Letter
of Credit Application, the Letter of Credit Guaranty, the Blocked Account
Agreement, the Depository Account Agreements, each Notice Letter, each
Depository Account Agreement, each Payment Direction
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Notice, and each Credit Card Depository Account Agreement delivered to a
Depository Bank or other financial institution pursuant to Section 8.11 hereof,
and the other documents, instruments and agreements referred to in Section 6.01
hereof, and all other instruments, agreements and documents from time to time
delivered in connection with or otherwise relating to any Related Document.
"Release" shall mean any spilling, leaking, pumping, pouring,
emitting, emptying, injection, discharging, injecting, escaping, leaching,
dumping or disposing (including abandonment or discarding of barrels, containers
and other closed receptacles containing any hazardous substance, pollutant or
contaminant) of a Hazardous Material into the indoor or outdoor environment or
onto or from any property presently or formerly owned or operated by the
Borrowers or any of their respective Subsidiaries, or at any disposed facility
that received Hazardous Materials generated by the Borrowers or any of their
respective Subsidiaries including the migration of Hazardous Materials through
or in the air, soil, surface water, groundwater or property.
"Remedial Action" shall mean all actions taken to (i) monitor,
assess, evaluate, investigate, clean up, remove, remediate, treat, contain or in
any other way address Hazardous Materials in the indoor or outdoor environment;
(ii) prevent or minimize a Release or threatened Release of Hazardous Materials
so that the Release or threatened Release does not migrate or endanger or
threaten to endanger public health or welfare or the environment; or (iii)
perform pre-remedial studies and investigations and post-remedial operation and
maintenance activities, or any other actions authorized by 42 U.S.C. ss. 9601.
"Replacement Notice" shall have the meaning set forth in
Section 2.03(e)(iv) hereof.
"Reportable Event" shall mean any of the events described in
Section 4043(c) of ERISA with respect to a Plan (other than events for which the
notice requirements have been waived).
"Reserve" or "Reserves" shall include, without limitation, (a)
a reserve of up to $4,000,000, and (b) any other reserves imposed by the Agent
that it believes to be commercially reasonable (it shall be deemed commercially
reasonable to impose reserves related to any changes affecting the Memorabilia).
"Reserve Requirements" shall mean, for any day as applied to a
Eurodollar Loan, the aggregate (without duplication) of the rates (expressed as
a decimal fraction) of reserve requirements in effect on such day (including,
without limitation, basic, supplemental, marginal and emergency reserves under
any regulations of the Board or other Governmental Authority having jurisdiction
with respect thereto) dealing with reserve requirements prescribed for
eurocurrency funding (currently referred to as "Eurocurrency Liabilities" in
Regulation D of the Board) maintained by a member bank of the Federal Reserve
System. Eurodollar Loans shall be deemed to constitute Eurocurrency Liabilities
and to be subject to such reserve requirements without benefit of or credit for
proration, exceptions or offsets which may be available from time to time to any
Lender or the Affiliate of any Lender under Regulation D.
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"Revolving Credit Commitment" shall mean, with respect to each
Lender, the amount set forth on Schedule 1.01(G) to this Agreement or assigned
to such Lender in accordance with Section 11.13, as such amounts may be reduced
from time to time pursuant to the terms of this Agreement, and "Revolving Credit
Commitments" shall, collectively, mean the aggregate amount of the Revolving
Credit Commitments of all the Lenders, the maximum amount of which shall not
exceed the Current Commitment.
"Section 2.15(c) Tax Certificate" shall have the meaning given
that term in subsection 2.15(c) hereof.
"Security Agreement" shall mean the Security Agreement,
substantially in the form of Exhibit B hereto, made by the Borrowers in favor of
the Agent, for the benefit of the Lenders, as amended, modified and supplemented
from time to time.
"Security Documents" shall mean, collectively, the Guaranty,
the Security Agreement, the Guarantor Security Agreement, the Pledge Agreement,
the Assignment for Security (Trademarks), substantially in the form of Exhibit A
to the Security Agreement, executed and delivered by the Borrowers, the
Assignment for Security (Copyrights), substantially in the form of Exhibit B to
the Security Agreement, executed and delivered by the Borrowers, and all Uniform
Commercial Code financing statements required by this Agreement, the Security
Agreement to be filed with respect to the security interests in personal
property and fixtures created pursuant to such agreements, and all other
documents and agreements executed and delivered by the Borrowers and/or their
respective Subsidiaries in connection with any of the foregoing documents.
"Settlement Period" shall have the meaning set forth in
subsection 2.03(f) hereof.
"Solvent" means, with respect to any Person on a particular
date, that on such date (a) the fair value of the property of such Person is not
less than the total amount of its liabilities, (b the present fair salable value
of the assets of such Person is not less than the amount that will be required
to pay the probable liability of such Person on its existing debts as they
become absolute and matured, (c) such Person is able to pay its debts and other
liabilities as they mature in the normal course of business, (d) such Person
does not intend to, and does not believe that it will, incur debts or
liabilities beyond such Person's ability to pay as such debts and liabilities
mature, and (e) such Person is not engaged in business or a transaction for
which such Person's property would constitute unreasonably small capital.
"Stated Amount" shall mean, with respect to a Letter of
Credit, the face amount thereof, drawn or undrawn, regardless of the existence
or satisfaction of any conditions or limitations on drawing.
"Store Specific Inventory" shall mean Inventory from a closed
store which contains any reference of any kind to a specific Planet Hollywood
location or retail facility.
"Subsidiary" shall mean Planet Hollywood Memorabilia, Inc.,
Region III, Hospitality and, with respect to any Person, any corporation,
limited or general partnership,
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limited liability company, limited liability partnership, trust, association or
other business entity of which an aggregate of more than fifty percent (50%) of
the outstanding stock or other interests entitled to vote in the election of the
Board of Directors or governing body performing like functions of such
corporation (irrespective of whether, at the time, stock of any other class or
classes of such corporation shall have or might have voting power by reason of
the happening of any contingency), managers, trustees or other controlling
persons, or an equivalent controlling interest therein, of such Person is, at
the time, directly or indirectly, owned or controlled by such Person and/or one
or more Subsidiaries of such Person; provided, however, that if Planet Hollywood
has the power to direct or cause the direction of the management and/or policies
of such Person, then the language "more than fifty percent (50%)" in this
definition shall read "fifty percent (50%) or more".
"Taxes" shall have the meaning given that term in Section 2.15
hereof.
"Termination Date" shall have the meaning given that term in
Section 2.01 hereof.
"Termination Event" shall mean (i) a Reportable Event with
respect to any Plan, (ii) the withdrawal of any Borrower, or any ERISA Affiliate
from a Plan during a plan year in which any Borrower or any ERISA Affiliate was
a "substantial employer" as defined in Section 4001(a)(2) of ERISA, (iii) the
imposition of an obligation on any Borrower, or any ERISA Affiliate under
Section 4041 of ERISA to provide affected parties written notice of intent to
terminate a Plan in a distress termination described in Section 4041(c) of
ERISA, or (iv) the institution by the PBGC of proceedings to terminate a Plan.
"TSP" shall mean Times Square Partners LLC.
"TSP Agreement" shall mean the Amended and Restated Limited
Liability Company Agreement of TSP, dated as of December 3, 1997, among Intell
Times Square LLC, Madison Broadway Associates LLC, SPE Times Square, Inc.,
Hospitality, and Xxx Xxxxx.
"TSP Membership Interest" shall mean the twenty percent (20%)
equity interest in TSP owned by Hospitality.
"Undrawn Letter of Credit Availability" shall mean with
respect to a Letter of Credit, at any time, the maximum amount available to be
drawn under such Letter of Credit at such time, regardless of the existence or
satisfaction of any conditions or limitations on drawing.
"Unfunded Current Liability" of any Plan shall mean the
amount, if any, by which the actuarial present value of the accumulated plan
benefits under the Plan as of the close of its most recent plan year, determined
in accordance with Statement of Financial Accounting Standards No. 35, based
upon the actuarial assumptions used by the Plan's actuary in the most recent
annual valuation of the Plan, exceeds the fair market value of the assets
allocable thereto, determined in accordance with Section 412 of the Code.
"Unreimbursed Draws" shall mean with respect to a Letter of
Credit created thereunder, at any time, the aggregate amount at such time of all
payments made by the Letter of Credit Issuer or payments made by the L/C
Indemnitor or the Lenders under a Letter of Credit
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Guaranty in respect of such payments under such Letter of Credit, to the extent
not repaid by the Borrower; provided, however, that Unreimbursed Draws shall not
include any such payments that have been charged to the Borrowers' Account and
constitute a Loan pursuant to the terms of this Agreement.
"Unused Line Fee" shall have the meaning given that term in
subsection 2.08(e).
"U.S. Subsidiaries" or "U.S. Subsidiary" shall mean any
Subsidiary that has (i) its domicile in the United States of America, and/or
(ii) its principal place of business or assets in the United States of America.
"WLR" shall have the meaning given that term in the
introductory paragraph to this Agreement.
1.02. Construction. Unless the context of this Agreement
otherwise clearly requires, references to the plural include the singular, the
singular the plural and the part the whole and "or" has the inclusive meaning
represented by the phrase "and/or." References in this Agreement to
"determination" by the Agent include good faith estimates by the Agent (in the
case of quantitative determinations) and good faith beliefs by the Agent (in the
case of qualitative determinations). The words "hereof," "herein," "hereunder"
and similar terms in this Agreement refer to this Agreement as a whole and not
to any particular provision of this Agreement. The section and other headings
contained in this Agreement and the Table of Contents preceding this Agreement
are for reference purposes only and shall not control or affect the construction
of this Agreement or the interpretation thereof in any respect. Section,
subsection and exhibit references are to this Agreement unless otherwise
specified.
1.03. Accounting Principles. Except as otherwise provided in
this Agreement, all computations and determinations as to accounting or
financial matters and all financial statements to be delivered pursuant to this
Agreement shall be made and prepared in accordance with GAAP (including
principles of consolidation where appropriate), and all accounting or financial
terms shall have the meanings ascribed to such terms by GAAP. Notwithstanding
the definition of GAAP contained in this Agreement, no change in GAAP that would
affect the method or calculation of any of the financial covenants, restrictions
or standards or definitions of terms used herein shall be given effect in such
calculations until such financial covenants, restrictions or standards or
definitions are amended in a manner satisfactory to the Borrowers and the
Majority Lenders so as to reflect such change in GAAP.
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ARTICLE II
THE CREDITS
-----------
2.01. Revolving Credit Loans. Subject to the terms and
conditions and relying upon the representations and warranties herein set forth,
each Lender severally agrees to make Loans to the Borrowers at any time and from
time to time on or after the date hereof and to, but not including, the
Termination Date, in an aggregate principal amount not exceeding at any one time
its Pro Rata Share of the Current Commitment at such time. No Lender shall have
an obligation to make Loans hereunder or arrange for the issuance of Letters of
Credit on or after the Termination Date or which, when added to the aggregate
amount of all outstanding and contemporaneous Loans and the Letter of Credit
Exposure at such time, would cause the aggregate amount of all Loans and the
Letter of Credit Exposure at any time to exceed the Current Commitment at such
time. The "Maturity Date" means the date on which the Revolving Credit
Commitment of each Lender expires, which shall be the second anniversary of the
date of this Agreement. The "Termination Date" shall mean the earlier of the
Maturity Date and any earlier date pursuant to which this Agreement may be
terminated as expressly provided herein. Within the limits of time and amount
set forth in this Section 2.01, and subject to the provisions of this Agreement,
the Borrowers may borrow, repay, and reborrow hereunder.
2.02. Notes. The obligation of the Borrowers to repay the
unpaid principal amount of the Loans made to it by each Lender and to pay
interest thereon shall be evidenced in part by a Note dated as of the date
hereof in the principal amount of such Lender's Revolving Credit Commitment with
the blanks appropriately filled in. An executed Note for each Lender shall be
delivered by each Borrower to the Agent on the date hereof.
2.03. Notice of Borrowing; Making of Loans.
(a) The Borrowers shall not be permitted to borrow
hereunder when available cash is in excess of $1,000,000. Whenever the Borrowers
desire to borrow, the Designated Borrowing Officer shall provide telephonic
notice of a proposed borrowing or written notice of such proposed borrowing (a
"Notice of Borrowing") shall be provided by the Designated Borrowing Officer to
the Agent (i) not later than 12:00 noon (New York City time) on the date of such
proposed borrowing, in the case of a borrowing consisting of Prime Loans, or
(ii) not later than 12:00 noon (New York City time) on the third (3rd) Business
Day before the date of such borrowing, in the case of a borrowing consisting of
Eurodollar Loans. The Notice of Borrowing shall set forth: (a) the date, which
shall be a Business Day, on which such borrowing is to occur, (b) whether such
Loan is requested to be a Prime Loan or a Eurodollar Loan and, if a Eurodollar
Loan, the Interest Period requested with respect thereto, (c) the principal
amount of the Loan being borrowed, and (d) the account information where such
Loan is to be received. Such notice shall be given by telephone or in writing;
provided, however, that, if requested by the Agent, any such telephonic notice
shall be confirmed in writing by delivery to the Agent on or before the close of
business on the date on which such Loan is to be made (but prior to such Loan
being made) a notice containing the original or facsimile signature of the
Designated Borrowing Officer. The Agent shall provide each Lender with prompt
notice of each Notice of Borrowing. Except as otherwise provided in subsection
2.03(e), on the date specified in such notice, each
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Lender shall, subject to the terms and conditions of this Agreement, make its
Pro Rata Share of such Loan in immediately available funds by wire transfer to
the Agent at its Office not later than 1:30 p.m. (New York City time). Unless
the Agent determines that any applicable conditions in Section 6.02 have not
been satisfied, the Agent shall make the funds so received from the Lenders
available to the Borrowers not later than 2:30 p.m. (New York City time), on the
date specified in such notice in immediately available funds by (i) depositing
such proceeds in the Disbursement Account if the Disbursement Account is located
at the Bank, and (ii) initiating a wire transfer if the Disbursement Account is
not located at the Bank.
(b) The Agent and each Lender shall be entitled to
rely conclusively on the Designated Borrowing Officer's authority to request a
Loan on behalf of the Borrowers until the Agent receives written notice to the
contrary. The Agent and the Lenders shall have no duty to verify the
authenticity of the signature appearing on any written Notice of Borrowing and,
with respect to an oral request for a Loan, the Agent and the Lenders shall have
no duty to verify the identity of any Person representing himself as a
Designated Borrowing Officer.
(c) The Agent and the Lenders shall not incur any
liability to the Borrowers in acting upon any telephonic notice referred to
above which the Agent and the Lenders believe in good faith to have been given
by the Designated Borrowing Officer or for otherwise acting in good faith under
this Section 2.03; and, upon the funding of a Loan by the Lenders (or by the
Agent on behalf of the Lenders) in accordance with this Agreement pursuant to
any such telephonic notice, the Borrowers shall have effected a Loan hereunder.
(d) Each Notice of Borrowing pursuant to this Section
2.03 shall be irrevocable and the Borrowers shall be bound to make a borrowing
in accordance therewith. Each Prime Loan shall be in a minimum amount of
$100,000, and each Eurodollar Loan shall be in a minimum amount of $500,000 and
in multiples of $100,000 if in excess thereof; provided, however, that the
Borrowers shall not be entitled to request any Loan that, if made, would result
in an aggregate of more than fifteen (15) separate Eurodollar Loans of any
Lender being outstanding hereunder at any one (1) time.
(e) (i) Except as otherwise provided in this
subsection 2.03(e), all Loans under this Agreement shall be made by the Lenders
simultaneously and proportionately to their Pro Rata Shares, it being understood
that no Lender shall be responsible for any default by any other Lender in that
other Lender's obligation to make a Loan requested hereunder or to be an L/C
Indemnitor nor shall the Revolving Credit Commitment of any Lender be increased
or decreased as a result of the default by any other Lender in that other
Lender's obligation to make a Loan requested hereunder or to be an L/C
Indemnitor; provided, however, that this subsection (e) is for the benefit of
the Lenders and pursuant to the Inter-Lender Agreement (and as between the
Lenders only), a Lender may be a L/C Indemnitor and another Lender may make
advances up to certain specific dollar amounts before the Lenders both advance
hereunder.
(ii) Notwithstanding any other provision of this
Agreement, and in order to reduce the number of fund transfers among the
Borrowers, the Lenders and the Agent, the Borrowers, the Lenders and the Agent
agree that the Agent may, but shall not be obligated to, and the Borrowers and
the Lenders hereby irrevocably authorize the Agent to, fund,
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on behalf of the Lenders, Loans pursuant to Section 2.01, subject to the
procedures for settlement set forth in subsection 2.03(f); provided, however,
that (a) the Agent shall in no event fund such Loans if the Agent shall have
received written notice from the Majority Lenders on the Business Day prior to
the day of the proposed Loan that one or more of the conditions precedent
contained in Section 6.02 will not be satisfied on the day of the proposed Loan,
and (b) the Agent shall not otherwise be required to determine that, or take
notice whether, the conditions precedent in Section 6.02 have been satisfied.
(iii) Unless (A) the Agent has notified the
Lenders that the Agent, on behalf of the Lenders, will fund a particular Loan
pursuant to subsection 2.03(e)(ii), or (B) the Agent shall have been notified by
any Lender on the Business Day prior to the day of a proposed Loan that such
Lender does not intend to make available to the Agent such Lender's Pro Rata
Share of the Loan requested on such day, the Agent may assume that such Lender
has made such amount available to the Agent on such day and the Agent, in its
sole discretion, may, but shall not be obligated to, cause a corresponding
amount to be made available to the Borrowers on such day. If the Agent makes
such corresponding amount available to the Borrowers and such corresponding
amount is not in fact made available to the Agent by such Lender, the Agent
shall be entitled to recover such corresponding amount on demand from such
Lender together with interest thereon, for each day from the date such payment
was due until the date such amount is paid to the Agent, at the customary rate
set by the Agent for the correction of errors among banks for three (3) Business
Days and thereafter at the Regular Rate. During the period in which such Lender
has not paid such corresponding amount to the Agent, notwithstanding anything to
the contrary contained in this Agreement or any other Related Document, the
amount so advanced by the Agent to the Borrowers shall, for all purposes hereof,
be a Loan made by the Agent for its own account. Upon any such failure by a
Lender to pay the Agent, the Agent shall promptly thereafter notify the
Borrowers of such failure and the Borrowers shall immediately pay such
corresponding amount to the Agent for its own account.
(iv) Nothing in this subsection 2.03(e) shall be
deemed to relieve any Lender from its obligation to fulfill its Revolving Credit
Commitment hereunder or to prejudice any rights that the Agent or the Borrowers
may have against any Lender as a result of any default by such Lender hereunder.
(f) (i) With respect to all periods for which the
Agent has funded Loans pursuant to subsection 2.03(e)(ii), on the Friday, or the
next Business Day if such Friday is not a Business Day, following the last day
of each week, or such shorter period as it may from time to time select (any
such week or shorter period being herein called a "Settlement Period"), the
Agent shall notify each Lender of the average daily unpaid principal amount of
the Loans outstanding during such Settlement Period. In the event that such
amount is greater than the average daily unpaid principal amount of the Loans
outstanding during the Settlement Period immediately preceding such Settlement
Period (or, if there has been no preceding Settlement Period, the amount of the
Loans made on the date of such Lender's initial funding), each Lender shall
promptly make available to the Agent its Pro Rata Share of the difference in
immediately available funds. In the event that such amount is less than such
average daily unpaid principal amount, the Agent shall promptly pay over to each
other Lender its Pro Rata Share of the difference in immediately available
funds. In addition, if the Agent shall so request at any time
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when a Potential Default or an Event of Default shall have occurred and be
continuing, or any other event shall have occurred as a result of which the
Agent shall determine that it is desirable to present claims against the
Borrowers for repayment, each Lender shall promptly remit to the Agent or, as
the case may be, the Agent shall promptly remit to each Lender, sufficient funds
to adjust the interests of the Lenders in the then outstanding Loans to such an
extent that, after giving effect to such adjustment, each Lender's interest in
the then outstanding Loans will be equal to its Pro Rata Share thereof. The
obligations of each Lender under this subsection 2.03(f) shall be absolute and
unconditional. Each Lender shall only be entitled to receive interest on its Pro
Rata Share of the Loans which have been funded by such Lender.
(ii) In the event that any Lender fails to make
any payment required to be made by it pursuant to subsection 2.03(f)(i), the
Agent shall be entitled to recover such corresponding amount on demand from such
Lender together with interest thereon, for each day from the date such payment
was due until the date such amount is paid to the Agent, at the customary rate
set by the Agent for the correction of errors among banks for three (3) Business
Days and thereafter at the Regular Rate. During the period in which such Lender
has not paid such corresponding amount to the Agent, notwithstanding anything to
the contrary contained in this Agreement or any other Related Document, the
amount so advanced by the Agent to the Borrowers shall, for all purposes hereof,
be a Loan made by the Agent for its own account. Upon any such failure by a
Lender to pay the Agent, the Agent shall promptly thereafter notify the
Borrowers of such failure and the Borrowers shall immediately pay such
corresponding amount to the Agent for its own account. Nothing in this
subsection 2.03(f)(ii) shall be deemed to relieve any Lender from its obligation
to fulfill its Revolving Credit Commitment hereunder or to prejudice any rights
that the Borrowers or the Agent may have against any Lender as a result of any
default by such Lender hereunder.
(g) The foregoing provisions of this Section 2.08 may
be varied as between CIT as Agent and Lender and WLR (but not as to the
Borrowers) by the terms of the Inter-Lender Agreement.
2.04. Reduction of Current Commitment; Mandatory Prepayment;
Optional Prepayment.
(a) (i) Voluntary Reduction of the Current
Commitment. The Borrowers may at any time or from time to time and without
penalty or premium reduce the Revolving Credit Commitments of the Lenders to an
amount (which may be zero) not less than the sum of (i) the unpaid principal
amount of all Loans then outstanding plus (ii) the principal amount of all Loans
not yet made as to which notice has been given by the Borrowers under Section
2.03 hereof plus (iii) the Letter of Credit Exposure at such time plus the
Stated Amount of all Letters of Credit not yet issued as to which a request has
been made unless the request is withdrawn and the Letter of Credit is not issued
by the Letter of Credit Issuer under Section 3.01 hereof. Any reduction shall be
in an amount which is an integral multiple of $500,000. Reduction of the
Revolving Credit Commitments of the Lenders shall be made by providing not less
than two (2) Business Days' written notice (which notice shall be irrevocable)
to such effect to the Agent (which notice the Agent shall promptly transmit to
each Lender). Reductions of the Revolving Credit Commitments of the Lenders
under this Section 2.04(a)(i) are irrevocable and
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may not be reinstated. Each such reduction shall reduce the Revolving Credit
Commitment of each Lender proportionately in accordance with its Pro Rata Share.
(ii) Mandatory Reduction of the Current
Commitment. To the extent that either (x) the Loans are prepaid pursuant hereto
or (y) the BH Notes are prepaid pursuant to the Note Purchase Agreement in each
case from the Net Proceeds of Asset Sales, the Current Commitment shall be
reduced as follows:
(A) Permanently and dollar-for-dollar in an
amount equal to the aggregate interest paid by the Borrowers
or any Subsidiary under the Note Purchase Agreement from the
original date thereof through the date of partial or full
prepayment thereof (or in the case of more than one partial
payment, from the date of the prior prepayment through the
date of the subsequent prepayment); and
(B) Until such time as the BH Notes are paid in
full and any obligation to fund thereunder is terminated,
dollar-for-dollar by an amount equal to the Net Cash Proceeds
of Asset Sales received by the Agent hereunder or the Agent
under the Note Purchase Agreement; provided, however, that
such reduction shall occur only when (1) Section 3.4 of the
Note Purchase Agreement requires that the Current Commitment
hereunder be reduced and (2) there is an outstanding
commitment or outstanding obligations under such Note Purchase
Agreement (it being the understanding of the parties that at
such time as the Note Purchase Agreement is terminated and
there are no outstanding obligations thereunder, the Current
Commitment shall be reinstated to $15,000,000 (minus amounts
specified in Section 2.04(a)(ii)(A) and any other permanent
reductions hereunder). For purposes of this Section
2.04(a)(ii)(B), only Asset Distribution Proceeds shall not
include any Net Proceeds that are not cash or Cash Equivalents
until such time as such amounts have been reduced to cash or
Cash Equivalents.
(b) Mandatory Prepayment.
(i) Exceeding Current Commitment. If at any time
either the Borrowing Base or the Current Commitment is less than the aggregate
unpaid principal amount of the Loans then outstanding plus the Letter of Credit
Exposure at such time, the Borrowers shall prepay an amount of the Loans not
less than the amount of such difference or, if the Loans then outstanding are
less than the amount of such difference, provide cash collateral to the Agent in
an amount equal to one hundred and five percent (105%) of such excess, which
cash collateral shall be deposited and held in the Letter of Credit Cash
Collateral Account until such time as such excess no longer exists. Any such
prepayment will not otherwise reduce the Revolving Credit Commitments of the
Lenders. Concurrently with any notice of reduction of the Revolving Credit
Commitments of the Lenders as set forth in Section 2.04(a), the Borrowers shall
give notice to the Agent of any mandatory prepayment which notice shall specify
a prepayment date no later than the effective date of such reduction of the
Revolving Credit Commitments of the Lenders.
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(ii) Asset Sales. Simultaneously with the
consummation of any Asset Sale (other than an Excluded Asset Sale), to the
extent permitted by and sold or otherwise disposed of in accordance with this
Agreement and subject to the terms and conditions of the Intercreditor Agreement
as to the application of the Net Proceeds of such Asset Sale to the obligations
owed to each party thereto, the Borrowers shall prepay the Loans (but not Letter
of Credit Exposure so long as at the time of such prepayment no Event of Default
has occurred and is continuing) in an aggregate principal amount equal to one
hundred percent (100%) of the Net Proceeds of such sale or disposition;
provided, however, that any proceeds of sales referred to in subsections
9.04(b)(i), (ii), (iv), (v) and (vi) shall be excluded from any prepayment
requirements set forth in this subsection. Upon and during the continuance of a
Default or an Event of Default, if any Asset Sale, Casualty or Condemnation
shall occur with respect to any Collateral or any other Asset, the Borrowers
shall (or shall cause any Subsidiary to) apply the Net Cash Proceeds, Insurance
Proceeds or Condemnation Proceeds therefrom to the Agent to the prepayment of
the Loans (but not Letter of Credit Exposure so long as at the time of such
prepayment no Event of Default has occurred and is continuing) in an aggregate
principal amount equal to one hundred percent (100%) of the Net Proceeds from
such Asset Sale, Casualty or Condemnation.
(iii) Other Mandatory Prepayments. The Agent
shall on each Business Day apply all funds deposited in the Agent Account to the
payment, in whole or in part, of the Obligations outstanding.
(c) Optional Prepayment. The Borrowers may at any
time or from time to time prepay, in whole or in part, any or all Loans then
outstanding. Any partial prepayment of a Eurodollar Loan shall not reduce the
aggregate principal amount of such Eurodollar Loan to less than $1,000,000. The
Borrowers may at any time pay all outstanding Obligations under the Loan
Documents, so long as simultaneously therewith the Borrowers shall pay two
percent (2%) of the Revolving Loan Commitment if the Revolving Loan Commitment
is terminated on or before the first anniversary of the Closing Date and one
percent (1%) of the Revolving Loan Commitment if the Revolving Loan Commitment
is terminated on any day prior to the Maturity Date (the "Early Termination
Fee").
(d) Prepayment Penalty. All prepayments of Loans
under this Section 2.04 shall be without premium or penalty, except that any
prepayment (x) of Eurodollar Loans shall be subject to the provisions of Section
2.12 hereof and (y) shall be subject to subsection (c) above.
2.05. Interest Rate.
(a) Each Prime Loan shall bear interest at a rate per
annum for each day until paid equal to the Regular Rate for such day.
(b) Each Eurodollar Loan shall bear interest at a
rate per annum equal to the Eurodollar Rate plus three and one quarter percent
(3.25%) for the Interest Period in effect for such Eurodollar Loan.
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2.06. Interest Payment Dates. The Borrowers shall pay interest
on the unpaid principal amount of each Loan from the date of such Loan until
such principal amount shall be paid in full, which interest shall be payable (i)
if such Loan is a Prime Loan, monthly in arrears on the first day of each month,
commencing June 1, 2000, and (ii) if such Loan is a Eurodollar Loan, (A) on the
last day of the Interest Period of such Eurodollar Loan, and (B) for any
Interest Period longer than three (3) months, on the day that occurs during such
Interest Period every three (3) months from the first day of such Interest
Period. After maturity of any principal amount of any Loan (by acceleration, at
scheduled maturity or otherwise), interest on such amount shall be due and
payable on demand.
2.07. Maturity Date. To the extent not due and payable earlier
pursuant to the terms of this Agreement, the entire unpaid principal amount of
each of the Loans shall be due and payable on the Maturity Date.
2.08. Payments.
(a) Time, Place and Manner. All payments and
prepayments to be made in respect of principal, interest, fees or other amounts
due from the Borrowers hereunder, the Notes or any other Related Document shall
be payable at or before 12:00 noon, New York City time, on the day when due
without presentment, demand, protest or notice of any kind, all of which are
hereby expressly waived. Such payments shall be made to the Agent for the
account of the Agent on behalf of the Lenders at the Agent Account in Dollars in
funds immediately available at the Bank's Office without setoff, counterclaim or
other deduction of any nature. The Agent shall maintain a separate loan account
(the "Borrowers' Account") on its books in the name of the Borrowers in which
the Borrowers will be charged with Loans made by the Agent or the Lenders to the
Borrowers hereunder and with any other Obligations. The Borrowers and the
Lenders hereby authorize the Agent to, and the Agent may, from time to time
charge the Borrowers' Account with any interest, fees, expenses and other
Obligations that are due and payable under this Agreement or any Related
Document. The Borrowers and the Lenders confirm that any charges which the Agent
may so make to the Borrowers' Account as herein provided will be made as an
accommodation to the Borrowers and solely at the Agent's discretion, and shall
constitute a Loan to the Borrowers funded by the Agent on behalf of the Lenders
and subject to subsections 2.03(e) and 2.03(f) of this Agreement. Each of the
Lenders and the Borrowers agree that the Agent shall have the right to make such
charges regardless of whether any Event of Default or Potential Default shall
have occurred and be continuing or whether any of the conditions precedent in
Section 6.02 have been satisfied. The Borrowers' Account will be credited upon
receipt of "good funds" in the Agent Account with all amounts actually received
by the Agent from the Borrowers or others for the account of the Borrowers.
Interest on all Loans and all fees that accrue on a per annum basis shall be
computed on the basis of the actual number of days elapsed in the period during
which interest or such fee accrues and a year of three hundred sixty (360) days.
In computing interest on any Loan, the date of the making of such Loan shall be
included and the date of payment shall be excluded; provided, however, that if a
Loan is repaid on the same day in which it is made, one (1) day's interest shall
be paid on such Loan.
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(b) Periodic Statements. The Agent shall provide the
Lenders and Planet Hollywood promptly after the end of each calendar month a
summary statement (in the form from time to time used by the Agent) of (A) the
opening and closing daily balances in the Borrowers' Account during such month,
(B) the amounts and dates of all Loans made during such month, (C) the amounts
and dates of all payments on account of the Loans made during such month and
each Lender's interest in the Loans, (D) the amount of interest accrued on the
Loans during such month, (E) any Letters of Credit issued by the Letter of
Credit Issuer during such month, specifying the Stated Amount thereof, (F) the
amount of charges to the Borrowers' Account or Loans to be made during such
month to reimburse the L/C Indemnitor, the Agent, the Lenders or the Letter of
Credit Issuer for drawings made under Letters of Credit or payments made by the
L/C Indemnitor, the Agent or the Lenders under the Letter of Credit Guaranty,
and (G) the amount and nature of any charges to the Borrowers' Account made
during such month on account of interest, fees and expenses and other
Obligations. All entries on any such statement shall, thirty (30) days after the
same is sent, be presumed to be correct and shall constitute prima facie
evidence of the information contained in such statement, subject to the
Borrowers' and each Lender's express right to rebut such presumption by
demonstrating to the reasonable satisfaction of the Agent the existence of any
error on the part of the Agent.
(c) Apportionment of Payments. Except as otherwise
provided in this subsection, aggregate principal and interest payments shall be
apportioned among all outstanding Loans to which such payments relate and
payments of the Unused Line Fee and the Letter of Credit Fee required to be paid
by the Borrowers to the Lenders under subsections 2.08(e) and (f) shall, as
applicable, be apportioned ratably among the Lenders, in each case according to
their Pro Rata Shares. All payments shall be remitted to the Agent and all such
payments and any other amounts, including, without limitation, proceeds of
Collateral received by the Agent from or on behalf of the Borrowers shall be
applied subject to the provisions of this Agreement first, to pay principal of
and interest on any Obligations funded by the Agent on behalf of the Lenders and
any reasonable fees, expense reimbursements or indemnities then due to the Agent
from the Borrower; second, to pay any reasonable fees, expense reimbursements or
indemnities then due to the Lenders or the Letter of Credit Issuer hereunder;
third, to pay interest due in respect of Loans and Unreimbursed Draws under
Letters of Credit; and fourth, to pay, prepay or provide cash collateral in
respect of principal of Loans and Letter of Credit Exposure. The Agent shall
promptly distribute to each Lender at its primary address set forth on the
appropriate signature page hereof, or at such other address as such Lender may
designate in writing, such funds as it may be entitled to receive. The foregoing
apportionment of payments is solely for the purpose of determining the
obligations of the Borrowers hereunder and, notwithstanding such apportionment,
any Lender may on its books and records allocate payments received by it in a
manner different from that contemplated hereby. No such different allocation
shall alter the rights and obligations of the Borrowers under this Agreement
determined in accordance with the apportionments contemplated by this Section
2.08(c). To the extent that the Borrowers make a payment or payments to the
Agent or the Agent receives any payment or other amount, which payment(s) or
proceeds or any part thereof are subsequently invalidated, declared to be
fraudulent or preferential, set aside and/or required to be repaid to a trustee,
receiver or any other party under any bankruptcy law, state or federal law,
common law or equitable cause then, to the extent of such payment or proceeds
received, the Obligations or part thereof intended to be satisfied
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shall be revived and continue in full force and effect, as if such payment or
proceeds had not been received by the Agent.
(d) Interest Upon Events of Default. To the extent
permitted by law, after there shall have occurred and so long as there is
continuing an Event of Default pursuant to Section 10.01, all principal,
interest, fees, indemnities or any other Obligations of the Borrowers hereunder,
under any Note or any other Related Document (and including interest accrued
under this subsection 2.08(d)) shall compound on a daily basis and shall bear
interest for each day until paid (before and after judgment), payable on demand,
at a rate per annum of two percent (2%) above the Prime Rate for such day, such
interest rate to change automatically from time to time effective as of the
announced effective date of each change in the Prime Rate (the "Default Rate").
(e) Unused Line Fee. From and after the Closing Date
until the Termination Date, the Borrowers shall pay to the Agent, for the
account of each Lender in accordance with such Lender's Pro Rata Share, an
unused line fee (the "Unused Line Fee") accruing at the rate of one-half of one
percent (0.50%) per annum, on the excess, if any, of the aggregate Revolving
Credit Commitments over the sum of the Loans and Letter of Credit Exposure
outstanding from time to time. All Unused Line Fees shall be payable monthly in
arrears on the first day of each month commencing on June 1, 2000.
(f) Letter of Credit Fees. From and after the Closing
Date, the Borrowers shall pay to the Agent for the benefit of the L/C
Indemnitor, a letter of credit fee accruing at the rate of two percent (2%) per
annum on the average daily face amount of the Letter of Credit Exposure
(collectively, the "Letter of Credit Fee"); provided, however, that the
Borrowers may maintain Letters of Credit with third parties in an aggregate
amount not to exceed $100,000 at any time that shall not be subject to the
Letter of Credit Fee. All Letter of Credit Fees shall be payable monthly in
arrears on the first day of each month commencing on June 1, 2000. The Borrowers
shall also pay the customary letter of credit fees, acceptance fees and charges
of the L/C Indemnitor and the Letter of Credit Issuer for the administration,
issuance, amendment and processing of any Letters of Credit issued by the Letter
of Credit Issuer. Promptly following the Agent's receipt of any Letter of Credit
Fees described above, the Agent shall pay to each Lender its Pro Rata Share of
the amount of the Letter of Credit Fees received by the Agent.
(g) Facility Fees. The Borrowers shall pay to the
Agent for the ratable benefit of the Lenders in accordance with their respective
Pro Rata Shares a fee of $337,500 payable on the Closing Date (a "Facility
Fee").
(h) Agent Fees. The Borrowers shall pay to the Agent
an Agent Fee of $75,000 payable on the Closing Date and payable annually
thereafter in advance on each anniversary of the Closing Date hereof (such fee
to be payable whether or not the Agent is a Lender hereunder so long as it is
the Agent) (the "Agent Fee"); provided, however, that the Agent Fee shall not be
payable upon the Maturity Date.
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(i) Payment of Fees. The Borrowers shall pay to the
Agent the fees set forth in this Section 2.08 at the times set forth herein
which (other than the Agent Fees) are allocated as between CIT and WLR under the
Inter-Lender Agreement. All fees under this Agreement and the other Related
Documents are non-refundable under all circumstances.
2.09. Use of Proceeds. The proceeds of the Loans shall be used
for working capital and other general corporate purposes. The Letters of Credit
shall be standby or documentary letters of credit, and will be used for general
corporate purposes.
2.10. Eurodollar Rate Not Determinable; Illegality or
Impropriety.
(a) In the event, and on each occasion, that on or
before the day on which the Eurodollar Rate is to be determined for a borrowing
that is to include Eurodollar Loans, the Agent has determined in good faith
that, or has been advised by the Bank that, the Eurodollar Rate cannot be
determined for any reason or the Eurodollar Rate will not adequately and fairly
reflect the cost of maintaining Eurodollar Loans or Dollar deposits in the
principal amount of the applicable Eurodollar Loans are not available in the
interbank eurodollar market where the eurodollar and foreign currency and
exchange operations in respect of the Bank's eurodollar loans are then being
conducted, the Agent shall, as soon as practicable thereafter, give written
notice of such determination to the Borrowers and the other Lenders. In the
event of any such determination, any request by the Borrowers for a Eurodollar
Loan pursuant to Section 2.03 shall, until the Agent shall have advised the
Borrowers and the other Lenders that the circumstances giving rise to such
notice no longer exist, be deemed to be a request for a Prime Loan. Each
determination by the Agent hereunder shall be conclusive and binding absent
manifest error.
(b) In the event that it shall be unlawful or
improper for any Lender to make, maintain or fund any Eurodollar Loan as
contemplated by this Agreement, then such Lender shall forthwith give notice
thereof to the Agent and the Borrowers describing such illegality or impropriety
in reasonable detail. Effective immediately upon the giving of such notice, the
obligation of such Lender to make Eurodollar Loans shall be suspended for the
duration of such illegality or impropriety and, if and when such illegality or
impropriety ceases to exist, such suspension shall cease, and such Lender shall
notify the Agent and the Borrowers. If any such change shall make it unlawful or
improper for any Lender to maintain any outstanding Eurodollar Loan as a
Eurodollar Loan, such Lender shall, upon the happening of such event, notify the
Agent and the Borrowers, and the Borrowers shall immediately, or if permitted by
applicable law, rule, regulation, order, decree, interpretation, request or
directive, no later than the date permitted thereby, convert each such
Eurodollar Loan into a Prime Loan.
2.11. Reserve Requirements; Capital Adequacy Circumstances.
(a) Notwithstanding any other provision herein, if
any change in applicable law or regulation after the Closing Date or in the
interpretation or administration thereof by any Governmental Authority charged
with the interpretation or administration thereof (whether or not having the
force of law) shall impose any tax on or change the basis of taxation of
payments to the Letter of Credit Issuer or any Lender or any Affiliate of a
Lender (in lieu of or
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in addition to the Lender) on the principal of or interest on any Eurodollar
Loan made by such Lender or of any amounts payable hereunder (other than taxes
imposed on the overall net income of the Letter of Credit Issuer or such Lender
or such Affiliate by the jurisdiction in which the Letter of Credit Issuer or
such Lender or such Affiliate has its principal office or by any political
subdivision or taxing authority therein), or shall impose, modify or deem
applicable any reserve, special deposit or similar requirement against assets
of, deposits with or for the account of or credit extended by the Letter of
Credit Issuer or such Lender or Affiliate of such Lender (except any such
reserve requirement that is reflected in Reserve Requirements) or shall impose
on the Letter of Credit Issuer or such Lender or such Affiliate any other
condition affecting this Agreement or any Eurodollar Loans made by such Lender
or any Letter of Credit, and the result of any of the foregoing shall be to
increase the cost to the Letter of Credit Issuer or such Lender of making or
maintaining any Eurodollar Loan or issuing or participating in any Letter of
Credit or to reduce the amount of any sum received or receivable by the Letter
of Credit Issuer or such Lender hereunder (whether of principal, interest or
otherwise) in respect thereof by an amount reasonably deemed by the Letter of
Credit Issuer or such Lender to be material, then the Borrowers shall pay to the
Letter of Credit Issuer or such Lender such additional amount or amounts as will
compensate the Letter of Credit Issuer or such Lender for such additional costs
incurred or reduction suffered. Any amount or amounts payable by the Borrowers
to the Letter of Credit Issuer or any Lender in accordance with the provisions
of this Section 2.11(a) shall be paid by the Borrowers to the Letter of Credit
Issuer or such Lender within twenty (20) days after receipt by the Borrowers
from the Letter of Credit Issuer or such Lender of a statement setting forth in
reasonable detail the amount or amounts due and the basis for the determination
from time to time of such amount or amounts, which statement shall be conclusive
and binding absent manifest error.
(b) If the Letter of Credit Issuer or any Lender
shall have reasonably determined that the adoption of any applicable law, rule
or regulation regarding capital adequacy, or any change therein, or any change
in the interpretation or administration thereof by any Governmental Authority,
central bank or comparable agency charged with the interpretation or
administration thereof, or compliance by the Letter of Credit Issuer or by such
Lender (or any lending office of such Lender) or by any Affiliate of such
Lender, as the case may be, with any request or directive regarding capital
adequacy (whether or not having the force of law) of any such authority, central
bank or comparable agency, has the effect of reducing the rate of return on the
Letter of Credit Issuer's or such Lender's capital or on the capital of such
Lender's Affiliate, as the case may be, as a consequence of the Letter of Credit
Issuer's obligations or such Lender's obligations under this Agreement and the
Related Documents to a level below that which the Letter of Credit Issuer or
such Lender or such Lender's Affiliate, as the case may be, could have achieved
but for such adoption, change or compliance (taking into consideration the
Letter of Credit Issuer's or such Lender's policies or such Lender's Affiliate's
policies, as the case may be, with respect to capital adequacy) by an amount
deemed by the Letter of Credit Issuer or such Lender to be material, then, from
time to time, the Borrowers shall reimburse the Letter of Credit Issuer or such
Lender for such reduction. Any amount or amounts payable by the Borrowers to the
Letter of Credit Issuer or any Lender in accordance with the provisions of this
Section 2.11(b) shall be paid by the Borrowers to the Letter of Credit Issuer or
such Lender within ten (10) days after receipt by the Borrowers from the Letter
of Credit Issuer or such Lender of a statement
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setting forth (i) in reasonable detail the amount or amounts due, (ii) the basis
for the determination from time to time of such amount or amounts and (iii) that
such amount(s) have been determined in good faith, which statement shall be
conclusive and binding absent manifest error.
(c) The protection of this Section 2.11 shall be
available to the Letter of Credit Issuer or any Lender regardless of any
possible contention of the invalidity or inapplicability of the law, rule,
regulation, guideline or other change or condition which shall have occurred or
been imposed.
2.12. Indemnity; Agent Duty to Change Eurodollar Loan Office.
(a) Each Borrower, jointly and severally, shall
indemnify each Lender against any loss or expense that such Lender actually
sustains or incurs as a consequence of (i) any failure by the Borrowers to
borrow any Eurodollar Loan hereunder or to convert any Prime Loan into a
Eurodollar Loan after notice of such borrowing or conversion has been given
pursuant to Section 2.03(a) or Section 2.14, as the case may be, (ii) any
payment, prepayment (mandatory or optional) or conversion of a Eurodollar Loan
required by any provision of this Agreement or otherwise made on a date other
than the last day of the Interest Period applicable thereto, or (iii) any
default in payment or prepayment of the principal amount of any Eurodollar Loan
or any part thereof or interest accrued thereon, as and when due and payable (at
the due date thereof, by notice of prepayment or otherwise), including, in each
such case, any loss (including, without limitation, loss of margin) or
reasonable expense sustained or incurred in liquidating or employing deposits
from third parties acquired to effect or maintain such Loan or any part thereof
as a Eurodollar Loan. Such loss or reasonable expense shall include but not be
limited to an amount equal to the excess, if any, as reasonably determined by
such Lender, of (A) its cost of obtaining the funds for the Loan being paid,
prepaid or converted or not borrowed or converted (based on the Eurodollar Rate
applicable thereto) for the period from the date of such payment, prepayment,
conversion or failure to borrow or convert to the last day of the Interest
Period for such Loan (or, in the case of a failure to borrow or convert, the
last day of the Interest Period for such Loan that would have commenced on the
date of such failure to borrow or convert) over (B) the amount of interest (as
reasonably determined by such Lender) that would be realized by such Lender in
re-employing the funds so paid, prepaid or converted or not borrowed or
converted for such Interest Period. A certificate of any Lender setting forth in
reasonable detail any amount or amounts that such Lender is entitled to receive
pursuant to this Section 2.12 and the basis for the determination of such amount
or amounts shall be delivered to the Borrowers and shall be conclusive and
binding absent manifest error.
(b) The Agent agrees that, in the event it becomes
aware of the occurrence of an event or the existence of a condition that would
cause the Lenders to be entitled to receive payments under clauses (ii), (iii),
or (iv) of Section 2.12(a), it will, if requested by Planet Hollywood, exercise
its reasonable best efforts to make, fund, or maintain each affected Eurodollar
Loan through another Office if, as a result thereof, the additional monies which
would otherwise be required to be paid to the Lenders pursuant to clauses (ii),
(iii), or (iv) of Section 2.12(a) would be reduced.
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2.13. Sharing of Setoffs. Each Lender agrees that if it shall,
through the exercise of a right of banker's lien, setoff or counterclaim against
the Borrowers or other security or interest arising from, or in lieu of, such
secured claim, received by such Lender under any applicable bankruptcy,
insolvency or other similar law or otherwise, or by any other means, obtain
payment (voluntary or involuntary) in respect of any Obligation as a result of
which the aggregate unpaid amount of the Obligations owing to it shall be
proportionately less than the aggregate unpaid amount of the Obligations owing
to any other Lender, it shall simultaneously purchase from such other Lender at
face value a participation in the Obligations owing to such other Lender, so
that the aggregate unpaid amount of the Obligations and participations in
Obligations held by each Lender shall be in the same proportion to the aggregate
unpaid amount of all Obligations owing to such Lender prior to such exercise of
banker's lien, setoff or counterclaim or other event was to the aggregate unpaid
amount of all Obligations outstanding prior to such exercise of banker's lien,
setoff or counterclaim or other event; provided, however, that if any such
purchase or purchases or adjustments shall be made pursuant to this Section 2.13
and the payment giving rise thereto shall thereafter be recovered, such purchase
or purchases or adjustments shall be rescinded to the extent of such recovery
and the purchase price or prices or adjustments restored without interest. The
Borrowers expressly consent to the foregoing arrangements and agrees that any
Lender holding a participation in an Obligation deemed to have been so purchased
may exercise any and all rights of banker's lien, setoff or counterclaim with
respect to any and all moneys owing by the Borrowers to such Lender by reason
thereof as fully as if such Lender had made a loan directly to the Borrowers in
the amount of such participation.
2.14. Continuation and Conversion of Loans. Subject to Section
2.03 and Section 2.10 hereof, the Borrowers shall have the right, at any time,
(a) on three (3) Business Days' prior irrevocable written or telephonic notice
to continue any Eurodollar Loan or any portion thereof into a subsequent
Interest Period or to convert any Prime Loan or portion thereof into a
Eurodollar Loan, or (b) on one (1) Business Day's prior irrevocable written or
telecopy notice to the Agent, to convert any Eurodollar Loan or portion thereof
into a Prime Loan, subject to the following:
(i) in the case of a continuation of a Eurodollar
Loan or portion thereof as such or a conversion of a Prime Loan or portion
thereof into a Eurodollar Loan (A) no Event of Default or Potential Default
shall have occurred and be continuing at the time of such continuation or
conversion, and (B) Eurodollar Loans resulting from this Section 2.14 shall be
limited in number as provided in subsection 2.03(d);
(ii) in the case of a continuation or conversion of
less than all Loans, the aggregate principal amount of any Eurodollar Loan
continued or converted shall not be less than $500,000 and in multiples of
$100,000 if in excess thereof;
(iii) each conversion shall be effected by the
Lenders by applying the proceeds of the new Loan to the Loan (or portion
thereof) being converted; and, in the case of a conversion from a Eurodollar
Loan to a Prime Loan, accrued interest on the Eurodollar Loan (or portion
thereof) being converted shall be paid by the Borrowers at the time of
conversion;
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(iv) if the new Loan made in respect of a conversion
shall be a Eurodollar Loan, the first Interest Period with respect thereto shall
commence on the date of conversion;
(v) no portion of any Loan shall be continued or
converted to a Eurodollar Loan with an Interest Period ending later than the
Maturity Date; and
(vi) if any conversion of a Eurodollar Loan shall be
effected on a day other than the last day of an Interest Period, the Borrowers
shall reimburse each Lender on demand for any loss incurred or to be incurred by
it in the reemployment of the funds released by such conversion as provided in
Section 2.12 hereof.
In the event that the Borrowers shall not give notice to continue any Eurodollar
Loan into a subsequent Interest Period, such Eurodollar Loan (unless repaid)
shall automatically become a Prime Loan at the expiration of the then current
Interest Period.
2.15. Taxes.
(a) All payments made by each Borrower hereunder,
under the Notes or under any other Loan Document, will be made without setoff,
counterclaim, deduction or other defense. All such payments shall be made free
and clear of and without deduction for any present or future income, franchise,
sales, use, excise, stamp or other taxes, levies, imposts, deductions, charges,
fees, withholdings, restrictions or conditions of any nature now or hereafter
imposed, levied, collected, withheld or assessed by any jurisdiction (whether
pursuant to United States Federal, state, local or foreign law) or by any
political subdivision or taxing authority thereof or therein, and all interest,
penalties or similar liabilities, excluding taxes on the overall net income of
the Lenders or the Letter of Credit Issuer (such nonexcluded taxes are
hereinafter collectively referred to as the "Taxes"). If any Borrower shall be
required by law to deduct or to withhold any Taxes from or in respect of any
amount payable hereunder, (i) the amount so payable shall be increased to the
extent necessary so that after making all required deductions and withholdings
(including Taxes on amounts payable to the Lenders or the Letter of Credit
Issuer pursuant to this sentence) the Lenders or the Letter of Credit Issuer
receive an amount equal to the sum they would have received had no such
deductions or withholdings been made, (ii) such Borrower shall make such
deductions or withholdings, and (iii) such Borrower shall pay the full amount
deducted or withheld to the relevant taxation authority in accordance with
applicable law. Whenever any Taxes are payable by any Borrower, as promptly as
possible thereafter, such Borrower shall send the Lenders, the Letter of Credit
Issuer and the Agent an official receipt showing payment. In addition, each
Borrower agrees to pay any present or future taxes, charges or similar levies
which arise from any payment made hereunder or from the execution, delivery,
performance, recordation or filing of, or otherwise with respect to, this
Agreement, the Notes, the Letters of Credit or any other Loan Document
(hereinafter referred to as "Other Taxes").
(b) Each Borrower shall jointly and severally
indemnify the Lenders and the Letter of Credit Issuer for the amount of Taxes or
Other Taxes (including, without limitation, any Taxes or Other Taxes imposed by
any jurisdiction on amounts payable under this Section 2.15) paid by any Lender
or the Letter of Credit Issuer and any liability (including
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penalties, interest and expenses for nonpayment, late payment or otherwise)
arising therefrom or with respect thereto, whether or not such Taxes or Other
Taxes were correctly or legally asserted. This indemnification shall be paid
within thirty (30) days from the date on which such Lender or such Letter of
Credit Issuer makes written demand.
(c) Each Lender that is not a United States person
(as such term is defined in Section 7701(a)(30) of the Code) for U.S. Federal
income tax purposes (each, a "Non-U.S. Lender") agrees to deliver to the
Borrowers and the Agent on or prior to the Closing Date or, in the case of a
Non-U.S. Lender that is an assignee or transferee of an interest under this
Agreement pursuant to Section 11.13 (unless such Non-U.S. Lender was already a
Lender hereunder immediately prior to such assignment or transfer), on the date
of such assignment or transfer to such Non-U.S. Lender, (i) two (2) accurate and
complete original signed copies of Internal Revenue Service Form W-8ECI, Form
W-8IMY, or Form W-8BEN (or successor forms) certifying that such Non-U.S. Lender
is entitled as of such date to a complete exemption from United States
withholding tax with respect to payments to be made under this Agreement and
under any Note, or (ii) if such Non-U.S. Lender is not a "bank" within the
meaning of Section 881(c)(3)(A) of the Code and cannot deliver either Internal
Revenue Service Form W-8ECI, Form W-8IMY or Form 8BEN (or any successor forms)
(with respect to a complete exemption under an income tax treaty), (x) a
certificate substantially in the form of Exhibit M (any such certificate, a
"Section 2.15(c) Tax Certificate"), and (y) two (2) accurate and complete
original signed copies of Internal Revenue Service Form W-8BEN or Form W-8IMY.
In addition, each Non-U.S. Lender agrees that from time to time after the
Closing Date, when the passage of time or a change in facts or circumstances
renders the previous certification obsolete or inaccurate in any material
respect, such Non-U.S. Lender will deliver to Planet Hollywood and the Agent two
(2) new accurate and complete original signed copies of Internal Revenue Service
Form W-8ECI, Form W-8BEN (with respect to a complete exemption under an income
tax treaty), or Form W-8BEN or Form W-8IMY and a Section 2.15(c) Tax
Certificate, as the case may be or such Non-U.S. Lender shall immediately notify
Planet Hollywood and the Agent of its inability to deliver any such form or
Section 2.15(c) Tax Certificate, in which case such Non-U.S. Lender shall not be
required to deliver any such form or Section 2.15(c) Tax Certificate.
Notwithstanding anything to the contrary contained in Section 2.15(a), but
subject to the immediately succeeding sentence, (x) the Borrowers shall be
entitled, to the extent required to do so by law, to deduct or withhold income
taxes imposed by the United States from interest payable hereunder or under a
Note for the account of any Non-U.S. Lender to the extent that such Non-U.S.
Lender has not provided to the Borrowers Internal Revenue Service Forms that
establish a complete exemption from such deduction or withholding, and (y) the
Borrowers shall not be obligated pursuant to Section 2.15(a) to make increased
payments to a Non-U.S. Lender in respect of income taxes imposed by the United
States if such Non-U.S. Lender has not provided to the Borrowers the Internal
Revenue Service Forms required to be provided to the Borrower pursuant to this
Section 2.15(c). Notwithstanding anything to the contrary contained in the
preceding sentence or elsewhere in this Section 2.15, the Borrowers agree to pay
any additional amounts and to indemnify each Non-U.S. Lender in the manner set
forth in subsections 2.15(a) and 2.15(b) in respect of any United States income
Taxes deducted or withheld by them (and, if any Non-U.S. Lender is a withholding
foreign partnership within the meaning of Treas. Reg. Sec.1-1441-5, in respect
of any United States income Taxes withheld by such Non-U.S. Lender with respect
to
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amounts received by such Non-U.S. Lender pursuant to this Agreement) if such
Taxes would not have been deducted or withheld but for any change that is
effective after the Closing Date in any applicable law, treaty, governmental
rule, regulation, guideline or order, or in the interpretation thereof.
(d) If the Borrowers fail to perform their
obligations under this Section 2.15, the Borrowers shall jointly and severally
indemnify the Agent, the Lenders and the Letter of Credit Issuer for any
incremental taxes, interest or penalties that may become payable as a result of
any such failure.
2.16. Joint and Several Liability. In addition to the
Borrowers' joint and several indemnification of the Agent and Lenders, as
provided under this Agreement and the Loan Documents, the Borrowers shall be
jointly and severally liable for the repayment in full of all Obligations.
2.17. Inter-Lender Arrangements. The Inter-Lender Agreement
specifies the arrangements between CIT and WLR in the event they do not agree
with respect to a decision required to be made hereunder. The Borrowers agree
that they are not third party beneficiaries of the Inter-Lender Agreement, have
no rights to enforce the terms thereof, and that the Inter-Lender Agreement may
be amended or modified without the consent of the Borrowers.
2.18. Equity Contributions. Additional contributions to the
Borrowers of equity may be utilized or employed by the Borrowers without
restriction hereunder.
ARTICLE III
LETTERS OF CREDIT
-----------------
3.01. Letters of Credit.
(a) General. In order to assist the Borrowers in
establishing or opening standby or documentary letters of credit, which shall
not have expiration dates that exceed one (1) year from the date of issuance
(the "Letters of Credit"), with the Letter of Credit Issuer, the Borrowers have
requested that either CIT or WLR (the "L/C Indemnitor") join in the applications
for such Letters of Credit, and/or guarantee payment or performance of such
Letters of Credit thereunder through the issuance of a Letter of Credit
Guaranty, thereby lending the L/C Indemnitor's credit to the Borrowers, and each
of CIT and WLR has agreed to do so. These arrangements shall be handled by the
L/C Indemnitor subject to the terms and conditions set forth below. The L/C
Indemnitor shall have no obligation to arrange for the issuance of Letters of
Credit on or after the Termination Date or which, when added to the aggregate
amount of all outstanding and contemporaneous Loans and the Letter of Credit
Exposure at such time, would cause the amount of all Loans and the Letter of
Credit Exposure at any time to exceed the Current Commitment at such time. In
addition, the L/C Indemnitor shall not be required to be the issuer of any
Letter of Credit. Any Borrower may be the account party for any application for
a Letter of Credit, which shall be substantially in the form of Exhibit G hereto
or on a computer transmission system approved by the L/C Indemnitor and the
Letter of Credit Issuer or such other
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written form or computer transmission system as may from time to time be
approved by the Letter of Credit Issuer and the L/C Indemnitor, and shall be
duly completed in a manner acceptable to the L/C Indemnitor, together with such
other certificates, agreements, documents and other papers and information as
the Letter of Credit Issuer or the L/C Indemnitor may request (the "Letter of
Credit Application").
(i) The aggregate Letter of Credit Exposure shall
not exceed $5,000,000 or an amount equal to the Current Commitment if such
Current Commitment is less than $5,000,000. In addition, changes or
modifications of the Letters of Credit by Planet Hollywood and/or the Letter of
Credit Issuer of the terms and conditions thereof shall in all respects be
subject to the prior approval of the L/C Indemnitor in the exercise of its
reasonable discretion, provided, however, that (x) the expiry date of all
Letters of Credit shall be no later than fifteen (15) days prior to the Maturity
Date unless, in the case of Letters of Credit, on or prior to fifteen (15) days
prior to the Maturity Date such Letters of Credit shall be cash collateralized
in an amount equal to at least one hundred and five percent (105%) of the Stated
Amount of such Letters of Credit, and (y) the Letters of Credit, and all
documentation in connection therewith, shall be in form and substance
satisfactory to the L/C Indemnitor and the Letter of Credit Issuer.
(ii) The Agent shall have the right, without
notice to the Borrowers, to charge the Borrowers' Account with the amount of any
and all indebtedness, liability or obligation of any kind (including
indemnification for breakage costs, capital adequacy and reserve requirement
charges) incurred by the Agent, the L/C Indemnitor or the Lenders under the
Letter of Credit Guaranty at the earlier of (x) payment by the L/C Indemnitor or
the Lenders under the Letter of Credit Guaranty, or (y) with respect to any
Letter of Credit which is not cash collateralized as provided in this Agreement,
the occurrence of an Event of Default. Any amount charged to the Borrowers'
Account shall be deemed a Loan hereunder made by the Lenders to the Borrowers,
funded by the Agent on behalf of the Lenders and subject to subsections 2.03(e)
and (f) of this Agreement. Any charges, fees, commissions, costs and expenses
charged to the L/C Indemnitor for the account of the Borrowers by the Letter of
Credit Issuer in connection with or arising out of Letters of Credit issued
pursuant to this Agreement or out of transactions relating thereto will be
charged to the Borrowers' Account in full when charged to or paid by the L/C
Indemnitor and any such charges to the Borrowers' Account shall be conclusive
and binding on the Borrowers and the Lenders absent manifest error. Each of the
Lenders and the Borrowers agree that the Agent shall have the right to make such
charges regardless of whether any Event of Default or Potential Default shall
have occurred and be continuing or whether any of the conditions precedent in
Section 6.02 have been satisfied.
(iii) Each Borrower agrees to unconditionally,
and jointly and severally, indemnify the Agent, CIT, WLR, the L/C Indemnitor and
each Lender, and to hold the Agent, CIT, WLR the L/C Indemnitor and each Lender
harmless from any and all loss, claim or liability incurred by the Agent, CIT,
WLR, the L/C Indemnitor or any such Lender arising from any transactions or
occurrences relating to Letters of Credit established or opened for the
Borrowers' Account and any drafts thereunder, and all Obligations thereunder,
including any such loss or claim due to any action taken by the Letter of Credit
Issuer, other than for any such loss, claim or liability arising out of the
gross negligence or willful misconduct of the Agent, CIT,
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WLR, the L/C Indemnitor or any Lender as determined by a final judgment of a
court of competent jurisdiction. Each Borrower's unconditional obligation to the
Agent, CIT, WLR, the L/C Indemnitor and each Lender hereunder shall not be
modified or diminished for any reason or in any manner whatsoever, other than as
a result of the Agent's, CIT's, WLR's, the L/C Indemnitor's or such Lender's
gross negligence or willful misconduct as determined by a final judgment of a
court of competent jurisdiction. The Borrowers agree that any charges incurred
by the L/C Indemnitor for the Borrowers' account shall be conclusive and binding
on the Borrowers absent manifest error and may be charged to the Borrowers'
Account.
(iv) None of the Agent, CIT, WLR, the L/C
Indemnitor, the Letter of Credit Issuer or any of the Lenders shall be
responsible for the existence, character, quality, quantity, condition, packing,
value or delivery of the goods purporting to be represented by any documents;
any difference or variation in the character, quality, quantity, condition,
packing, value or delivery of the goods from that expressed in the documents;
the validity, sufficiency or genuineness of any documents or of any endorsements
thereof even if such documents should in fact prove to be in any or all respects
invalid, insufficient, fraudulent or forged; the time, place, manner or order in
which shipment is made; partial or incomplete shipments, or failure or omission
to ship any or all of the goods referred to in the Letters of Credit or
documents; any deviation from instructions; delay, default, or fraud by the
shipper and/or anyone else in connection with any such goods or the shipping
thereof; or any breach of contract between the shipper or vendors and the
Borrowers. Furthermore, without being limited by the foregoing, none of the
Agent, CIT, WLR, the L/C Indemnitor, the Letter of Credit Issuer or any of the
Lenders shall be responsible for any act or omission with respect to or in
connection with any goods covered by Letters of Credit.
(v) The Borrowers agree that any action taken by
the Agent, CIT, WLR, the Letter of Credit Issuer, the L/C Indemnitor, or any
Lender, if taken in good faith (and not constituting gross negligence or willful
misconduct), under or in connection with the Letters of Credit, the guarantees,
the drafts, or the goods purported to be represented by any documents, shall be
binding on the Borrowers (with respect to the Letter of Credit Issuer, the L/C
Indemnitor, the Agent, CIT, WLR, and the Lenders) and shall not put the Agent,
CIT, WLR, the Letter of Credit Issuer, the L/C Indemnitor, or the Lenders in any
resulting liability to the Borrowers. In furtherance thereof, the L/C Indemnitor
shall have the full right and authority to clear and resolve any questions of
non-compliance of documents; to give any instructions as to acceptance or
rejection of any documents or goods; to execute any and all steamship or airways
guaranties (and applications therefore), indemnities or delivery orders; to
grant any extensions of the maturity of, time of payment for, or time of
presentation of, any drafts or documents; and to agree to any amendments,
renewals, extensions, modifications, changes or cancellations of any of the
terms or conditions of any of the applications, Letters of Credit or drafts; all
in the L/C Indemnitor's sole name, and the Letter of Credit Issuer shall be
entitled to comply with and honor any and all such documents or instruments
executed by or received solely from the L/C Indemnitor, all without any notice
to or any consent from the Borrower; provided, however, that, notwithstanding
the foregoing, in the absence of a continuing Event of Default, the L/C
Indemnitor shall not take any of the foregoing actions that result in a
departure in any material respect from the terms of the relevant Letter of
Credit or Letter of Credit Application.
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(vi) Without the L/C Indemnitor's express consent
and endorsement in writing, which, in the case of clause (x) below, in the
absence of a continuing Event of Default shall not be unreasonably withheld or
delayed, the Borrowers agree: (x) not to execute any applications for steamship
or airway guaranties, indemnities or delivery orders; to grant any extensions of
the maturity of, time of payment for, or time of presentation of, any drafts or
documents, or to agree to any amendments, renewals, extensions, modifications,
changes or cancellations of any of the terms or conditions of any of the
applications or Letters of Credit; and (y) after the occurrence and during the
continuance of an Event of Default not to (A) clear and resolve any questions of
non-compliance of documents, or (B) give any instructions as to acceptances or
rejection of any documents or goods.
(vii) The Borrowers agree that any necessary and
material import, export or other license or certificates for the import or
handling of Inventory or Memorabilia will have been promptly procured; all
foreign and domestic governmental Laws and regulations in regard to the shipment
and importation of Inventory or Memorabilia or the financing thereof will have
been promptly and fully complied with, except where instances of non-compliance
with any such Law or regulation, individually or in the aggregate, would not
result in and could not reasonably be expected to result in a Material Adverse
Effect, and any certificates in that regard that the Agent may at any time
reasonably request will be promptly furnished. In this connection, the Borrowers
represent and warrant that all shipments made under any such Letters of Credit
are in compliance with the Laws and regulations of the countries in which the
shipments originate and terminate, except where any such non-compliance would
not result in and could not reasonably be expected to result in a Material
Adverse Effect. As between the Borrowers, on the one hand, and the Agent, CIT,
WLR, the Lenders and the Letter of Credit Issuer, on the other hand, the
Borrowers assume all risk, liability and responsibility for, and agree to pay
and discharge, all present and future local, state, federal or foreign taxes,
duties, or levies (other than based on the net income of the Lender). As between
the Borrowers, on the one hand, and the Agent, CIT, WLR, the Lenders and the
Letter of Credit Issuer, on the other hand, any embargo, restriction, Laws,
customs or regulations of any country, state, city, or other political
subdivision, where such Inventory or Memorabilia is or may be located, or
wherein payments are to be made, or wherein drafts may be drawn, negotiated,
accepted, or paid, shall be solely the Borrowers' risk, liability and
responsibility.
(viii) Upon any payments made by the L/C
Indemnitor to the Letter of Credit Issuer under the Letter of Credit Guaranty,
CIT, WLR or the Lenders, as the case may be, shall, without prejudice to its
rights under this Agreement (including that such unreimbursed amounts shall
constitute Loans hereunder), acquire (to the extent of such payment) by
subrogation, any rights, remedies, duties or obligations granted or undertaken
by the Borrowers to the Letter of Credit Issuer in any Letter of Credit
Application, any standing agreement relating to Letters of Credit or otherwise,
all of which shall be deemed to have been granted to CIT, WLR, the Agent and the
Lenders and apply in all respects to CIT, WLR, the Agent and the Lenders and
shall be in addition to any rights, remedies, duties or obligations contained
herein.
(ix) In the event that the Borrowers are required
to provide cash collateral for any Letter of Credit, the Borrowers shall deposit
such cash collateral in the Letter of
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Credit Cash Collateral Account, which cash collateral shall be held in the
Letter of Credit Cash Collateral Account until all Obligations have been paid in
full in cash; provided, however, that, when the Borrowers elect, and are not
required to provide cash collateral for a Letter of Credit, the cash collateral
for such Letter of Credit shall be returned to the Borrowers if at such time (A)
an Event of Default or Potential Default has not occurred and is not continuing,
and (B) no amounts are available to be drawn on such Letter of Credit and all
Unreimbursed Draws have been paid in full.
(b) Request for Issuance. Planet Hollywood may from
time to time, upon notice (an "L/C Notice") not later than 12:00 noon, New York
City time, at least three (3) Business Days in advance, make a request that it
be assisted in establishing or opening a Letter of Credit by delivering to the
Agent and the Letter of Credit Issuer, a Letter of Credit Application, together
with any necessary related documents. Neither CIT nor WLR shall provide support,
pursuant to the Letter of Credit Guaranty, if the Agent shall have received
written notice from the Majority Lenders on the Business Day immediately
preceding the proposed issuance day for such Letter of Credit that one or more
of the conditions precedent in Section 6.02 will not have been satisfied on such
date, and neither CIT, WLR nor the Agent shall otherwise be required to
determine that, or take notice whether, the conditions precedent set forth in
Section 6.02 have been satisfied.
(c) Existing Letters of Credit. Planet Hollywood
represents and warrants that Schedule 3.01(c) hereto sets forth all Letters of
Credit existing as of the Closing Date.
3.02. Participations.
(a) Purchase of Participations. Immediately upon the
issuance by the Letter of Credit Issuer of any Letter of Credit in accordance
with the procedures set forth in Section 3.01, each Lender (other than the L/C
Indemnitor) shall be deemed to have irrevocably and unconditionally purchased
and received from the L/C Indemnitor, without recourse or warranty, an undivided
interest and participation, to the extent of such Lender's Pro Rata Share, in
all obligations of the L/C Indemnitor with respect to such Letter of Credit
created thereunder (including, without limitation, all Undrawn Letter of Credit
Availability and Reimbursement Obligations of the Borrowers with respect thereto
pursuant to the Letter of Credit Guaranty or otherwise).
(b) Sharing of Letter of Credit Payments. In the
event that the L/C Indemnitor makes any payment in respect of the Letter of
Credit Guaranty with respect to a Letter of Credit and the Borrowers shall not
have repaid such amount to the Agent for the account of L/C Indemnitor, the
Agent shall charge the Borrowers' Account in the amount of the Reimbursement
Obligation, in accordance with Section 3.01(a)(ii).
(c) Obligations Irrevocable. The obligations of a
Lender to make payments to the Agent for the account of the Agent, CIT or WLR
with respect to a Letter of Credit shall be irrevocable, not subject to any
qualification or exception whatsoever and shall be
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made in accordance with, but not subject to, the terms and conditions of this
Agreement under all circumstances, including, without limitation, any of the
following circumstances:
(i) any lack of validity or enforceability of
this Agreement or any of the other Related Documents;
(ii) the existence of any claim, setoff, defense
or other right which the Borrowers may have at any time against a beneficiary
named in a Letter of Credit or any transferee of any Letter of Credit or any
holder of a draft (or any Person for whom any such transferee may be acting),
the Agent, Letter of Credit Issuer, any Lender, or any other Person, whether in
connection with this Agreement, any Letter of Credit, or any unrelated
transactions (including any underlying transactions between the Borrowers or any
other party and the beneficiary named in any Letter of Credit);
(iii) any draft, certificate or any other
document presented under the Letter of Credit proving to be forged, fraudulent,
invalid or insufficient in any respect or any statement therein being untrue or
inaccurate in any respect;
(iv) the surrender or impairment of any security
for the performance or observance of any of the terms of any of the Related
Documents;
(v) any failure by the Agent to provide any
notices required pursuant to this Agreement relating to Letters of Credit; or
(vi) the occurrence of any Event of Default or
Potential Default.
ARTICLE IV
BORROWING BASE
--------------
4.01. Condition of Lending and Assisting in Establishing or
Opening Letters of Credit. CIT, WLR and the other Lenders, if any, shall have no
obligation to make a Loan or assist in establishing or opening a Letter of
Credit to the extent that the aggregate unpaid principal amount of the Loans
plus the Letter of Credit Exposure exceeds, or after giving effect to a
requested Credit Extension, would exceed, the Borrowing Base or the Current
Commitment at such time.
4.02. Mandatory Prepayment. Concurrently with the delivery of
any Borrowing Base Certificate, the Borrowers shall give notice to the Agent in
the event of any mandatory prepayment pursuant to Section 2.04(b)(i), which
notice shall specify a prepayment date no later than the earlier of the date on
which such Borrowing Base Certificate is given and the date on which such
Borrowing Base Certificate is required to be provided to the Lenders.
4.03. Rights and Obligations Unconditional. Without limitation
of any other provision of this Agreement, the rights of the Agent, CIT, WLR and
the Lenders, and the obligations of the Borrowers under this Article IV are
absolute and unconditional, and the Agent, CIT, WLR and the Lenders, shall not
be deemed to have waived the condition set forth in Section
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4.01 hereof or their right to payment in accordance with Section 4.02 hereof in
any circumstance whatever, including but not limited to circumstances wherein,
the Agent or the Lenders (knowingly or otherwise) make an advance hereunder in
excess of the Borrowing Base.
4.04. Borrowing Base Certificate.
(a) By 12:00 noon, New York City time three (3)
Business Days after Saturday of each week, or more often if required in the
discretion of the Agent, the Borrowers shall furnish to the Agent a certificate
(a "Borrowing Base Certificate") substantially in the form attached hereto as
Exhibit H certified as true and correct by the Designated Financial Officer,
setting forth the Borrowing Base and the other information required therein as
of the Planet Hollywood's close of business on the Saturday of the preceding
week, based on the Borrowers' interim perpetual Records, together with such
other information with respect to the Inventory and the Memorabilia of the
Borrowers as the Agent may reasonably request.
(b) In the event of any dispute about the eligibility
of any asset for inclusion in the Borrowing Base or the valuation thereof, the
Agent's good faith and reasonable judgment shall control.
(c) The Borrowing Base set forth in a Borrowing Base
Certificate shall be effective from and including the date such Borrowing Base
Certificate is duly received by the Agent to but not including the date on which
a subsequent Borrowing Base Certificate is duly received by the Agent, unless
the Agent disputes the eligibility of any asset for inclusion in the Borrowing
Base or the valuation thereof by notice of such dispute to the Borrowers, in
which case the value of such asset shall, at the discretion of the Borrowers,
either not be included in the Borrowing Base or be included in the Borrowing
Base with a value reasonably acceptable to the Agent.
(d) Each Borrowing Base Certificate shall be
accompanied by backup schedules showing the derivation thereof and containing
such detail and such other and further information as the Agent may reasonably
request from time to time.
4.05. General Provisions. Notwithstanding anything to the
contrary in this Article IV, in no event shall any single element of value or
asset be counted twice in determining the Borrowing Base.
ARTICLE V
SECURITY
--------
5.01. Collateral. As security for the full and timely payment
and performance of all of the Obligations, each Borrower hereby as of the
Closing Date, assigns, pledges, transfers, grants, bargains and sells, conveys,
releases, confirms and sets over unto the Agent, for the ratable benefit of each
of the Lenders, and hereby grants and creates in favor of the Agent, for the
ratable benefit of each of the Lenders, a security interest in the Collateral.
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5.02 Trademarks. Any Borrower shall have the right to allow
any trademark (other than the PH Trademarks) to lapse if such Borrower
determines to do so in its reasonable business judgment and there would be no
Material Adverse Effect.
ARTICLE VI
CONDITIONS OF EFFECTIVENESS,
LETTER OF CREDIT ISSUANCE AND LENDING
-------------------------------------
6.01. Conditions Precedent to Effectiveness. This Agreement
shall become effective as of the Business Day when each of the following
conditions precedent shall have been satisfied and the obligation of any Lender
to make the initial Loan hereunder or the obligation of the L/C Indemnitor or
any Lender to assist the Borrowers in obtaining the issuance of the initial
Letter of Credit hereunder shall be subject to the satisfaction of the following
conditions precedent (the "Closing Date"):
(a) Noteholders. A loan is made available by the Note
Holders on terms and conditions satisfactory to the Lenders, such term loan
being subject to the terms and conditions of the Intercreditor Agreement.
(b) Payment of Fees, Etc. The Borrowers shall have
paid all fees, costs and expenses then payable by the Borrowers including,
without limitation, those due and payable pursuant to Sections 2.08 and 11.06
hereof. The Borrowers shall have paid to counsel to the Agent and WLR all
reasonable fees and other client charges due to such counsel on the Closing
Date.
(c) Representations and Warranties; No Event of
Default. Except with respect to Inactive Guarantors, the representations and
warranties contained in Article VII of this Agreement and in each other Loan
Document and certificate or other writing delivered to the Agent, the Lenders or
the Letter of Credit Issuer pursuant hereto or thereto or prior to the Closing
Date shall be correct on and as of the Closing Date as though made on and as of
such date; and no Potential Default or Event of Default shall have occurred and
be continuing on the Closing Date or would result from this Agreement becoming
effective in accordance with its terms.
(d) Legality. The making of the initial Loans and the
issuance of the initial Letter of Credit shall not contravene any law, rule or
regulation applicable to the Agent, the L/C Indemnitor, the Lenders or the
Letter of Credit Issuer.
(e) Delivery of Documents. The Agent shall have
received on or before the Closing Date the following, each in form and substance
satisfactory to the Agent and, unless indicated otherwise, dated the Closing
Date:
(i) a Note payable to the order of each Lender,
duly executed by the Borrowers and dated as of the Closing Date;
(ii) a copy of the resolutions adopted by the
Boards of Directors or governing bodies performing like functions of each
Borrower and each Guarantor (other than
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Inactive Guarantors), certified by authorized officers thereof, authorizing (A)
the transactions contemplated by the Loan Documents to which such Borrower or
such Guarantor is or will be a party, and (B) the execution, delivery and
performance by such Borrower or such Guarantor of each Loan Document and the
execution and delivery of the other documents to be delivered by such Borrower
or such Guarantor in connection therewith;
(iii) a certificate of authorized officers of
each Borrower and each Guarantor (other than Inactive Guarantors), certifying
the names and true signatures of the officers of such Borrower or such Guarantor
authorized to sign each Loan Document to which such Borrower or such Guarantor
is or will be a party and the other documents to be executed and delivered by
such Borrower or such Guarantor in connection therewith, together with evidence
of the incumbency of such authorized officers;
(iv) as to each Borrower, a copy of the charter
of each Borrower certified as of a date not more than ten (10) Business Days
prior to the Closing Date by the appropriate official(s) of the state of
incorporation of such Borrower and certified and by an authorized officer of
such Borrower, and, as to each Guarantor (other than Inactive Guarantors), a
copy of the charter of such Guarantor certified as of a date not more than ten
(10) Business Days prior to the Closing Date by an authorized officer of such
Guarantor;
(v) a copy of the by-laws of each Borrower and
each Guarantor (other than Inactive Guarantors), certified as of the Closing
Date by an authorized officer of such Borrower and each Guarantor;
(vi) an opinion of (a) Stroock & Stroock & Xxxxx
LLP, counsel to the Borrowers and the Guarantors (other than Inactive
Guarantors) (as to bankruptcy matters, New York law and Delaware law, as
applicable), (b) Gray, Harris & Xxxxxxxx, P.A. and Florida counsel to the
Borrowers and Guarantors as to matters governed under Florida law, (c) law firms
qualified in Texas, Minnesota and Nevada as to due authorization, execution and
delivery of the Loan Documents under the laws of such states.
(vii) a certificate of the Designated Financial
Officer certifying as to the matters set forth in subsection (c) of this Section
6.01;
(viii) a copy of the financial statements and
projections of the Borrowers referred to in Section 7.08 hereof certified by the
Designated Financial Officer;
(ix) a Borrowing Base Certificate, current as of
the close of business on the date required by the Agent, certified by the
Designated Financial Officer;
(x) a certificate of an authorized officer of
each Borrower certifying the names and true signatures of those officers or
agents of the Borrowers that are authorized to provide Notices of Borrowing and
all other notices under this Agreement and the Loan Documents;
(xi) copies of each Credit Card Agreement to
which any Borrower is a party, certified as true and correct by the Designated
Financial Officer;
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(xii) a certificate of an authorized officer of
each Borrower and each Guarantor stating that it has no Plans or any
Multiemployer Plans other than the Planet Hollywood Employee Savings Plan;
(xiii) a certificate of insurance evidencing
insurance on the property of such Borrower or such Guarantor (other than
Inactive Guarantors) as is required by Section 8.07 of this Agreement, naming
the Agent as additional insured or loss payee, for all insurance maintained by
such Borrower and such Guarantor;
(xiv) such other agreements, instruments,
approvals, opinions and other documents as the Agent may reasonably request;
(xv) evidence, including a listing of all
effective financing statements which name as debtor each Borrower and each
Guarantor, tax Liens and judgment Liens, establishing the absence of any liens
on Collateral (other than Permitted Liens), including Inventory or Memorabilia,
and upon the request of the Agent, the execution and delivery of any public
filings deemed necessary or desirable by the Agent;
(xvi) the Loan Documents duly executed by the
parties thereto;
(xvii) appropriate financing statements on Form
UCC-1, duly executed by each Borrower and each Guarantor and duly filed in such
office or offices as may be necessary or, in the opinion of the Agent, desirable
to perfect the security interests purported to be created by the Loan Documents
and evidence that all necessary filing fees and taxes or other expenses related
to such filings have been paid in full; and
(xviii) for each Borrower and each Guarantor
(other than Inactive Guarantors), a certificate, dated as of a date not more
than ten (10) Business Days prior to the Closing Date, of the appropriate
official(s) of such state where such Borrower's or such Guarantor's formation
documents are filed and each state of foreign qualification of such Borrower or
such Guarantor, certifying as to the subsistence in good standing of, and the
payment of taxes by, such Borrower in such states.
(f) Receipt of Documents. All Loan Documents and all
documents incidental thereto, shall be satisfactory to the Agent and its special
counsel, and the Agent and such special counsel shall have received all such
information and such counterpart originals or certified or other copies of such
documents, in form and substance reasonably satisfactory to the Agent, as the
Agent or such special counsel may reasonably request.
(g) Cash Management System. The cash management
system of each Borrower and its Subsidiaries (other than Inactive Guarantors)
shall be satisfactory to the Agent.
(h) Lien Priority. The Liens in favor of the Lenders
pursuant to the Loan Documents hereof shall be valid and perfected first
priority Liens on the Collateral, which Collateral shall be subject to no other
Liens except for Permitted Liens.
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(i) Compliance. The Agent shall be satisfied as to
each Borrower's and each Guarantor's (other than Inactive Guarantors) compliance
with all Environmental Laws, ERISA, tax, and labor matters.
(j) Inventory Appraisal. The Agent shall have
completed and shall be satisfied (in its sole discretion) with the results of an
update of the appraisal of the Inventory, and the Borrowers shall have paid all
fees and expenses payable in connection with such update.
(k) Memorabilia Appraisal. The Agent shall have
completed and shall be satisfied (in its sole discretion) with the results of an
update of the appraisal of the Memorabilia and shall be satisfied that any
stored or "in transit" Memorabilia is appropriately stored and held for
safekeeping. The Borrowers shall have paid all fees and expenses payable in
connection with such appraisal.
(l) No Liens. There are no liens or encumbrances of
any kind on any Collateral other than Permitted Liens.
(m) No Material Adverse Effect. Since December 31,
1999, there shall have been no Material Adverse Effect (other than with respect
to the Inactive Guarantors), excluding events related to the bankruptcy cases of
the Borrowers.
(n) Due Diligence. The Agent shall have completed its
due diligence to its satisfaction, including, without limitation, review of the
Borrowers' books and records, systems and controls and analysis of the Inventory
and Memorabilia by an outside consultant selected by the Agent. The results of
such review shall be in form and substance satisfactory to the Agent. In
connection with the Agent's due diligence investigation of any Borrower or any
Guarantor, reasonable out-of-pocket travel expenses (including those incurred in
connection with periodic field audits by employees of the Agent), reasonable
out-of-pocket fees and expenses incurred by the Agent or Lenders in connection
with above. Any oral or written request by the Borrowers for any Credit
Extension hereunder shall constitute a representation and warranty by the
Borrowers that the conditions set forth in this Section 6.02 have been satisfied
as of the date of such request. Failure of the Agent to receive notice from the
Borrowers to the contrary before such Credit Extension is made shall constitute
a further representation and warranty by the Borrowers that the conditions set
forth in this Section 6.02 have been satisfied as of the date of such Credit
Extension.
(o) Outstanding Letters of Credit. The terms,
conditions and amounts of all outstanding standby and documentary letters of
credit related to the Borrowers shall be reasonably satisfactory to the Agent.
(p) Court Order Approving Loan Documents. The
Confirmation Order shall not have been amended or modified (without the consent
of the Lenders) and there shall not have been any appeal or stay with respect
thereto. A court order shall be entered approving the Loan Documents and such
other matters as may be requested by the Lenders, including, without
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limitation, a finding with respect to the binding nature of the Intercreditor
Agreement on the parties thereto or the parties purported to be bound thereby,
including, without limitation, the PIK Holders, and such Order shall not be
subject to any application for a stay pending appeal or other reconsideration
with respect thereto and shall not be subject to any such stay or other
injunctive relief affecting the enforceability thereof.
(q) Cash and Availability. Cash plus Availability (as
determined by the Lenders in accordance with the Loan Documents) under the
Facility shall not be less than $6,000,000.
(r) Plan of Reorganization; Limitation on Plan of
Reorganization Payments. The Plan of Reorganization, and all ancillary
documents, shall be satisfactory to the Lenders in all respects. No payments to
fund the Plan of Reorganization or pay any creditor on account of a prepetition
claim on the Closing Date shall exceed $66,000,000.
(s) Certain Post-Confirmation Obligations. The
Lenders shall be satisfied as to the nature of any post-confirmation obligations
arising from pre-petition obligations (including any continuing guarantee
obligations).
(t) Intercreditor Agreement and the Inter-Lender
Agreement. The Intercreditor Agreement and the Inter-Lender Agreement shall be
in form and substance satisfactory to the Agent.
(u) Warehouse Waivers. The Borrowers shall deliver
the warehouse waivers for warehouses listed in Schedule 6.01(u) in form and
substance satisfactory to the Agent.
(v) Credit Card Depository Account Agreements and
Credit Card Payment Direction Notices. The Borrowers and the Guarantors (other
than the Inactive Guarantors) shall deliver to each Credit Card Obligor a Credit
Card Depository Account Agreement substantially in the form annexed as Exhibit J
hereto (the "Credit Card Depository Account Agreement") and the Payment
Direction Notice substantially in the form annexed as Exhibit J-1 hereto.
(w) Depository Account Agreements and Notice Letters
to Depository Banks. The Borrowers and the Guarantors (other than the Inactive
Guarantors) shall deliver to each Depository Bank the Depository Account
Agreement substantially in the form annexed as Exhibit L hereto and the Notice
Letter to Depository Bank substantially in the form annexed as Exhibit K hereto
(the "Notice Letter") (in the Agent's sole discretion, the delivery requirement
to the Depository Banks may be delayed by five (5) days from the Closing Date so
long as fully executed notices (Exhibit K) are delivered on the Closing Date).
(x) Memorabilia Report. The Memorabilia Report shall
be delivered dated the Closing Date updated to reflect all transactions from the
date of the prior report including, without limitation, new acquisitions, sold
Memorabilia, transfers of the location or ownership of the Memorabilia.
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(y) Times Square Letter. Hospitality shall deliver a
direction letter in form and substance satisfactory to the Agent to Times Square
Partners and SPF Times Square Inc. directing distributions from Times Square
Partners LLC to be delivered to the Agent.
(z) Employment Agreement. The Employment Agreement
and the Agreement Regarding Leases shall each be duly executed by Xxxxxx Xxxx.
6.02. Conditions Precedent to Loans and Letters of Credit. In
addition to the requirements of Section 6.01, the obligation of each Lender to
make any Loan and the obligation of the L/C Indemnitor or any Lender to assist
the Borrowers in obtaining the issuance of any Letter of Credit is subject to
the fulfillment, in a manner satisfactory to the Agent, of each of the following
conditions precedent:
(a) Payment of Fees, Etc. The Borrowers shall have
paid all fees, costs, expenses and taxes then payable by the Borrowers pursuant
to Sections 2.08 and 11.06 hereof.
(b) Representations and Warranties; No Event of
Default. The following statements shall be true, and the submission by the
Borrowers to the Agent of a Notice of Borrowing with respect to a Loan and the
Borrowers' acceptance of the proceeds of such Loan, or the submission by the
Borrowers to the Agent and the Letter of Credit Issuer of an L/C Notice with
respect to a Letter of Credit and the issuance of such Letter of Credit shall be
deemed to be a representation and warranty by the Borrowers on the date of such
Loan and the date of the issuance of such Letter of Credit that, (i) the
representations and warranties contained in Article VII of this Agreement and in
each other Loan Document and certificate or other writing delivered to the
Agent, the Lenders and the Letter of Credit Issuer pursuant hereto on or prior
to the date of such Loan or Letter of Credit are correct on and as of such date
as though made on and as of such date (except for representations and warranties
which relate to a specific date); and (ii) no Potential Default or Event of
Default has occurred and is continuing or would result from the making of the
Loan to be made on such date or the issuance of the Letter of Credit to be
issued on such date.
(c) Legality. The making of such Loan or the issuance
of such Letter of Credit shall not contravene any law, rule or regulation
applicable to the Agent, the L/C Indemnitor, the Lenders or the Letter of Credit
Issuer.
(d) Borrowing Notice. The Agent shall have received a
Notice of Borrowing pursuant to Section 2.03 hereof no later than 12:00 noon
(New York City time) three (3) Business Days prior to the date of the proposed
borrowing with respect to a Eurodollar Loan or on the date of a proposed
borrowing of a Prime Loan or an L/C Notice and a Letter of Credit Application
pursuant to Section 3.01 hereof not later than 12:00 noon (New York City time)
three (3) Business Days prior to the proposed date of issuance of a Letter of
Credit.
(e) Receipt of Documents. The Agent shall have
received such other agreements, instruments, approvals and other documents, each
in form and substance reasonably satisfactory to the Agent, as the Agent may
reasonably request.
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(f) Proceedings; Receipt of Documents. All
proceedings in connection with the making of such Loan or the issuance of such
Letter of Credit and the other transactions contemplated by this Agreement, and
all documents incidental thereto, shall be reasonably satisfactory to the Agent
and its special counsel, and the Agent and such special counsel shall have
received all such information and such counterpart originals or certified or
other copies of such documents, in form and substance reasonably satisfactory to
the Agent, as the Agent or such special counsel may reasonably request.
(g) Commitment. The aggregate unpaid principal amount
of the Loans and the Letter of Credit Exposure shall not exceed, and after
giving effect to the requested Credit Extension will not exceed, the Current
Commitment.
(h) Plan of Reorganization and Confirmation Order in
Full Force and Effect. The Plan of Reorganization and the Confirmation Order
shall be in full force and effect and shall not have been appealed, reversed,
modified, amended or stayed (or application therefor made), except for appeals,
modifications and amendments that are acceptable to the Lenders and not adverse
to their interests.
(i) Certain Payments. No payments to fund the Plan of
Reorganization pursuant to the Confirmation Order or thereafter (with respect to
amounts not fixed on the Effective Date of the Plan of Reorganization) shall
exceed $66,000,000 plus $7,900,000.
ARTICLE VII
REPRESENTATIONS AND WARRANTIES
------------------------------
As of the Closing Date and any date a Loan is made or Letter
of Credit is issued hereunder, the Borrowers hereby represent and warrant to the
Agent and the Lenders as follows (but none of the following representations and
warranties shall apply to the Inactive Guarantors):
7.01. Organization, Good Standing, Etc. Each Borrower and each
of its respective Subsidiaries (i) is a corporation, partnership or limited
liability company duly organized, validly existing and in good standing under
the laws of the state of its formation, (ii) has all requisite power and
authority to conduct its business as now conducted and as presently contemplated
and (in the case of such Borrower) to make the borrowings hereunder and to
consummate the transactions contemplated hereby, except in the case where
instances of failure to obtain such power and authority, individually or in the
aggregate, would not result in and could not reasonably be expected to result in
a Material Adverse Effect, and (iii) is duly qualified to do business and is in
good standing in each jurisdiction in which the character of the properties
owned or leased by it or in which the transaction of its business makes such
qualification necessary, except where instances of a failure to qualify or
remain in good standing or a failure to maintain rights and privileges,
individually or in the aggregate, would not result in and could not reasonably
be expected to result in a Material Adverse Effect.
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7.02. Authority and Authorization. The execution, delivery and
performance by each Borrower and their Subsidiaries of each Loan Document to
which it is a party, (i) have been duly authorized by all necessary corporate
action, (ii) do not and will not contravene its charter or by-laws, any other
applicable law or any contractual restriction binding on or otherwise affecting
it or any of its properties or result in a default under any agreement or
instrument to which each Borrower or any of their Subsidiaries is a party or by
which they or their respective properties may be subject, except in the case of
contractual restrictions where instances of such contravention, individually or
in the aggregate, would not result in and could not reasonably be expected to
result in a Material Adverse Effect, (iii) do not and will not result in or
require the creation of any Lien (other than pursuant to any such Loan Document,
as modified by the Intercreditor Agreement or with respect to Inactive
Guarantors) upon or with respect to any of its properties, and (iv) do not and
will not result in any suspension, revocation, impairment, forfeiture or
nonrenewal of any permit, license, authorization or approval applicable to its
operations or any of its properties, except with respect to Inactive Guarantors
and where instances of such suspension, revocation, impairment, forfeiture or
nonrenewal, individually or in the aggregate, would not result in and could not
reasonably be expected to result in a Material Adverse Effect.
7.03. Execution and Binding Effect. As of the Closing Date,
this Agreement and each of the other Loan Documents required to be executed and
delivered on or prior to the date hereof has been duly and validly executed and
delivered by each such Borrower and Guarantor party thereto, and constitutes the
legal, valid and binding obligations of each Borrower and each Guarantor
enforceable in accordance with the terms hereof or thereof. Each Loan Document
that is not required to be executed and delivered by a Borrower or a Guarantor
prior to the Closing Date, when executed and delivered, will be validly executed
and delivered by such Borrower or Guarantor and will constitute legal, valid and
binding obligations of such Borrower or Guarantor enforceable against it in
accordance with the terms thereof, except as enforceability may be limited by
(a) applicable bankruptcy, insolvency, fraudulent conveyance, fraudulent
transfer, reorganization, moratorium or similar laws from time to time in effect
affecting generally the enforcement of creditors' rights and remedies, and (b)
general principles of equity, including, without limitation, principles of
reasonableness, good faith and fair dealing and an implied covenant of good
faith and fair dealing (regardless of whether enforcement is sought in equity or
at law), principles requiring consideration of the impracticability or
impossibility of performance at any time, and principles affording defenses
based on unconscionability, and such principles may include a requirement that a
creditor act reasonably and in good faith.
7.04. Governmental Approvals. Other than as obtained
heretofore, or with respect to the filing of UCC-1 forms with the appropriate
filing officer, no authorization, consent, approval, license, exemption or other
action by, and no registration, qualification, designation, declaration or
filing with, any Governmental Authority is or will be necessary in connection
with the execution and delivery by any Borrower or any of their respective
Subsidiaries of each Loan Document to which it is a party, consummation of the
transactions therein contemplated, performance of or compliance with the terms
and conditions thereof or to ensure the legality, validity, enforceability and
admissibility in evidence thereof.
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7.05. Absence of Conflicts. Neither the execution and delivery
of this Agreement or the other Loan Documents to which the Borrowers or the
Guarantors are a party nor consummation of the transactions herein or therein
contemplated nor performance of or compliance with the terms and conditions
hereof or thereof will (a) violate any Law, (b) conflict with or result in a
breach of or default under its charter or by-laws, or any material agreement or
instrument to which the Borrowers or the Guarantors are a party or by which it
or any of their properties (now owned or hereafter acquired) may be subject or
bound, or (c) result in the creation or imposition of any Lien upon any property
(now owned or hereafter acquired) of the Borrowers and the Guarantors, except
the Liens in favor of the Agent with respect to the Collateral, as modified by
the Intercreditor Agreement, except where instances of such violation of Law,
conflict, or breach of any agreement or instrument, individually or in the
aggregate, would not result in and could not reasonably be expected to result in
a Material Adverse Effect.
7.06. Subsidiaries. Schedule 7.06 hereto is a complete and
correct description of the name, jurisdiction of organization and ownership of
the outstanding equity interests of each Subsidiary of the Borrowers in
existence on the Closing Date. All shares of such stock owned by the Borrowers
or one or more of their Subsidiaries, as indicated in such Schedule, are owned
free and clear of all Liens.
7.07. Litigation. Except as set forth in the financial
statements referred to in Section 7.08 hereof and on Schedule 7.07 hereto (which
has previously been delivered to the Agent), there is not, to the best knowledge
of any Borrowers, any pending or threatened proceeding by or before any
Governmental Authority, arbitrator or grand jury against or affecting any
Borrower or any ERISA Affiliate with respect to any Environmental Law or ERISA,
which, if adversely decided, can reasonably be expected to have a Material
Adverse Effect.
7.08. Financial Condition; Historical Statements. The
Borrowers have heretofore furnished to the Agent a balance sheet of Planet
Hollywood and its Consolidated Subsidiaries for the fiscal year ended December
31, 1998 and the related statements of operations and cash flows for the fiscal
year then ended, as examined and reported on by PricewaterhouseCoopers LLP,
independent certified public accountants, and a balance sheet and related
statements of operations and cash flows of Planet Hollywood and its Consolidated
Subsidiaries for and as of the end of the nine (9) month period ended September
30, 1999, as certified by the Designated Financial Officer. Such financial
statements present fairly, in all material respects, the financial condition of
Planet Hollywood and its Consolidated Subsidiaries as of the end of such fiscal
year and as of the end of such period, as applicable, and the results of its
operations and the cash flows for the fiscal year then ended and for the period
then ended, as applicable, all in conformity with GAAP applied on a basis
consistent with that of the preceding fiscal year, subject (in the case of the
interim financial statements) to year-end adjustments. Except as disclosed
therein and in the Plan of Reorganization, the Borrowers and their Subsidiaries
do not have any material contingent liabilities (including liabilities for
taxes), unusual forward or long term commitments or unrealized or anticipated
losses from unfavorable commitments.
7.09. Compliance with Law, Etc. Each of the Borrowers and each
of the Guarantors is not in violation of its charter or by-laws, in violation of
any Law (including but not
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limited to violations pertaining to the conduct of its business or the use,
maintenance or operation of the real and personal properties owned or possessed
by it), or in breach of any material term of any agreement or instrument binding
on or otherwise affecting it or any of its properties, except, in the case of
such violations and breaches (other than violations relating to the payment of
Taxes which, if unpaid, could result in a Lien on any Collateral or any other
violation or breach that may result in a Lien on any Collateral), where
instances of violation or breach of any agreement or instrument, individually or
in the aggregate, would not result in and could not reasonably be expected to
result in a Material Adverse Effect.
7.10. ERISA. Except as disclosed on Schedule 7.10 hereto, (i)
each Plan is in substantial compliance with ERISA and the Code, (ii) no
Termination Event has occurred nor is reasonably expected to occur with respect
to any Plan, (iii) the most recent annual report (Form 5500 Series) with respect
to each Plan, including Schedule B (Actuarial Information) thereto, copies of
which have been filed with the Internal Revenue Service, is complete and correct
and fairly presents the funding status of such Plan; and to the best of the
Borrowers' knowledge, there has been no material adverse change in such funding
status since the date of such report; (iv) no Plan has an Unfunded Current
Liability (other than an Unfunded Current Liability resulting from interest rate
fluctuations) in excess of $100,000; (v) no Plan had an accumulated or waived
funding deficiency or permitted decreases which would create a deficiency in its
funding standard account within the meaning of Section 412 of the Code at any
time during the previous sixty (60) months in excess of $100,000, (vi) all
contributions required to be made with respect to a Plan have been timely made;
(vii) neither the Borrowers nor any ERISA Affiliate has incurred any liability
to or on account of a Plan pursuant to Section 409, 502(i), 502(1), 515, 4062,
4063, 4064, 4069, 4201, 4204, or 4212(c) of ERISA or Section 401(a)(29), 4971 or
4975 of the Code or reasonably expects to incur any liability (including any
indirect, contingent, or secondary liability) under any of the foregoing
Sections with respect to any Plan in excess of $100,000; (viii) no proceedings
have been instituted to terminate or appoint a trustee to administer any Plan;
(ix) no condition exists which presents a material risk to any Borrower or any
ERISA Affiliate of incurring a material liability to or on account of a Plan
pursuant to the foregoing provisions of ERISA and the Code; (x) no Lien imposed
under the Code or ERISA exists or is likely to arise on account of any Plan; and
(xi) there are no pending or, to the knowledge of the Borrowers, threatened
claims, actions, proceedings, or lawsuits (other than ordinary course claims for
benefits) asserted against any Plan or its assets, any fiduciary with respect to
any Plan, any Borrower, or any ERISA Affiliate. Neither any Borrower nor any
ERISA Affiliate has incurred any withdrawal liability under ERISA with respect
to any Multiemployer Plan, and neither any Borrower nor any ERISA Affiliate
expects to incur a withdrawal liability. Except as required by Section 4980B of
the Code, or as otherwise disclosed on Schedule 7.10 hereto, no Borrower nor any
ERISA Affiliate maintains a welfare plan (as defined in Section 3(1) of ERISA)
which provides benefits or coverage after a participant's termination of
employment. All Plans in existence on the Closing Date are set forth on Schedule
7.10 hereto.
7.11. Taxes, Etc. All Tax returns required to be filed by the
Borrowers and the Guarantors have been properly prepared, executed and filed.
All Taxes, assessments, fees and other governmental charges upon the Borrowers
and their Subsidiaries or upon any of their respective properties, income, sales
or franchises which are shown thereon as due and payable
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have been paid. The reserves and provisions for Taxes, if any, on the books of
the Borrowers are adequate for all open years and for its current fiscal period.
The Borrowers do not know of any proposed additional assessment or basis for any
material assessment for additional Taxes (whether or not reserved against),
which, if assessed, would cause a violation of Sections 6.01(r) or hereof. The
federal income Tax liabilities of the Borrowers have been finally determined by
the Internal Revenue Service, or the time for audit has expired, for all fiscal
periods ended on or prior to January 1, 1995, and all such liabilities
(including all deficiencies assessed following audit) have been satisfied.
7.12. Full Disclosure. No representation or warranty made by
any Borrower or any Guarantor under this Agreement or any other Loan Document is
false or misleading in any material respect and no Loan Document or schedule or
exhibit thereto and no certificate, report, statement or other document or
information furnished to the Agent or the Lenders in connection herewith or
therewith or with the consummation of the transactions contemplated hereby and
thereby, contains, taken as a whole, any material misstatement of fact or omits
to state a material fact or any fact necessary to make the statements contained
herein or therein not misleading. To the extent the Borrowers furnish any
projections of the financial position and results of operations of the Borrowers
and their respective Subsidiaries for, or as at the end of, certain future
periods, such projections are prepared in good faith on the basis of
assumptions, methods and tests stated therein which are reasonably believed by
the Borrowers to have been reasonable and information reasonably believed by the
Borrowers to have been accurate based upon the information available to the
Borrowers at the time such projections were furnished to the Agent. The
Borrowers have disclosed to the Agent all relevant information that, to the best
of their knowledge, is reasonably likely to result in a Material Adverse Effect.
7.13. Operating Lease Obligations; Existing Liens; Unpaid
Rent. On the Closing Date, the Borrowers and their Subsidiaries do not have any
obligations as lessee for the payment of rent for any real property other than
the Operating Lease Obligations set forth in Schedule 7.13 hereto. There are no
Liens on any assets of the Borrowers other than (i) the Lien created as of the
Closing Date in favor of the Agent hereunder, (ii) Liens securing Capitalized
Lease Obligations of the Borrowers, and (iii) Permitted Liens. As of the Closing
Date, the outstanding rent for the leased distribution centers, warehouses and
retail stores of the Borrowers is current as of June 1, 2000.
7.14. Environmental Matters. Except as disclosed in Schedule
7.14 hereto, (i) none of the operations of any Borrower or its Subsidiaries are
the subject of any federal, state or local investigation to determine whether
any Remedial Action is needed to address the presence, disposal, Release or
threatened Release which is reasonably likely to result in Environmental
Liabilities and Costs of $500,000 or more in the aggregate together with other
such Environmental Liabilities and Costs, (ii) the Borrowers and their
respective Subsidiaries do not have any contingent liability in connection with
any Release which is reasonably likely to result in Environmental Liabilities
and Costs of $500,000 or more in the aggregate together with other such
Environmental Liabilities and Costs, (iii) the operations of the Borrowers and
their respective Subsidiaries are in compliance with all Environmental Laws,
except those laws where a failure to comply is not reasonably likely to result
in Environmental Liabilities and Costs of $500,000 or more in the aggregate
together with such other Environmental Liabilities and Costs,
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(iv) there has been no Release at any of the properties owned or operated by the
Borrowers, their respective Subsidiaries or any predecessor in interest or
title, or at any disposal or treatment facility which received Hazardous
Materials generated by the Borrowers or their Subsidiaries or any predecessor in
interest or title which is reasonably likely to result in Environmental
Liabilities and Costs of $500,000 or more in the aggregate together with other
such Environmental Liabilities and Costs; (v) no Environmental Actions have been
asserted against the Borrowers or their Subsidiaries or any predecessor in
interest or title nor do the Borrowers or their Subsidiaries have knowledge or
notice of any threatened or pending Environmental Action against the Borrowers
or their Subsidiaries or any predecessor in interest or title which, if
adversely determined, is reasonably likely to result in Environmental
Liabilities and Costs of $500,000 or more in the aggregate together with other
such Environmental Liabilities and Costs; (vi) the Borrowers and their
Subsidiaries have obtained all permits, approvals, authorizations and licenses
required by Environmental Laws necessary for their operations, and all such
permits, approvals, authorizations and licenses are in effect and the Borrowers
and their Subsidiaries are in compliance with all terms and conditions of such
permits, approvals, authorizations and licenses, (vii) no Environmental Actions
have been asserted against any facilities that may have received Hazardous
Materials generated by the Borrowers and their Subsidiaries or any predecessor
in interest or title which, if adversely determined, is reasonably likely to
result in Environmental Liabilities and Costs of $500,000 or more in the
aggregate together with other such Environmental Liabilities and Costs.
7.15. Schedules. All of the information which is required to
be scheduled to this Agreement is set forth on the Schedules attached hereto, is
correct and accurate (other inaccuracies of de minimus effect), and does not
omit to state any information material thereto.
7.16. Insurance. The Borrowers and their Subsidiaries keep
their properties adequately insured and maintain (i) insurance to such extent
and against such risks, including fire, as is customary with companies in the
same or similar businesses, (ii) workmen's compensation insurance in the amount
required by applicable law, (iii) public liability insurance in the amount
customary with companies in the same or similar business against claims for
personal injury or death on properties owned, occupied or controlled by it, and
(iv) such other insurance as may be required by law or by the Loan Documents.
Schedule 7.16 hereto sets forth a list of all insurance maintained by the
Borrowers and their Subsidiaries on the Closing Date.
7.17. Use of Proceeds. The proceeds of the Loans shall be used
for working capital purposes and for other general corporate purposes. The
Letters of Credit will be used to support insurance policies and customs bonds
and for other general corporate purposes.
7.18. Financial Accounting Practices, Etc.
(a) The Borrowers and their Subsidiaries make and
keep books, records and accounts which, in reasonable detail, accurately and
fairly reflect their respective transactions and dispositions of their
respective assets and maintain a system of internal accounting controls
sufficient to provide reasonable assurances that (i) transactions are executed
in accordance with management's general or specific authorization, and (ii)
transactions are
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recorded as necessary (A) to permit preparation of financial statements in
conformity with GAAP except as previously disclosed to the Agent and (B) to
maintain accountability for assets.
(b) The Borrowers and their Subsidiaries maintain a
system of internal procedures and controls sufficient to provide reasonable
assurance that the information required to be set forth in each Borrowing Base
Certificate (including, without limitation, information relating to the
identification of assets which are Inventory and Memorabilia and the respective
valuation thereof) is accurate.
7.19. No Material Adverse Effect. Since December 31, 1999,
there shall have been no Material Adverse Effect (other than with respect to the
Inactive Guarantors), excluding events related to the bankruptcy cases of the
Borrowers.
7.20. Real Property; Leases.
(a) Schedule 7.20(a) hereto sets forth a complete and
accurate description and list as of the Closing Date of the location, by state
and street address, of all real property owned and leased by the Borrowers and
their respective Subsidiaries, together with, in the case of real property that
is owned, a statement as to whether such real property is the subject of a
contract of sale (and, if so, a statement as to the status of such sale).
(b) As of the Closing Date, the Borrowers and their
Subsidiaries have valid leasehold interests in the Leases described in Schedule
7.20(b) hereto. None of the Leases is subject to any Lien except Liens granted
to the Agent pursuant to the Security Documents and Permitted Liens. Schedule
7.20(b) hereto sets forth with respect to each Lease, the commencement date,
termination date, renewal options (if any) and annual base rents. Each such
Lease is valid and enforceable in accordance with its terms in all material
respects and is in full force and effect. Except as set forth on Schedule
7.20(b) hereto, no consent or approval of any landlord or other third party in
connection with the Leases is necessary for the Borrowers or any of their
Subsidiaries to enter into and execute the Loan Documents. Neither the Borrowers
nor any of their Subsidiaries or, to the knowledge of the Borrowers or any of
their Subsidiaries, any other party to any Lease is in default of its
obligations thereunder and neither the Borrowers nor any of their Subsidiaries
nor any other party to any such Lease has at any time delivered or received any
notice of default which remains uncured under any such Lease and, as of the
Closing Date, no event has occurred which, with the giving of notice or the
passage of time, or both, would constitute a default under any such Lease,
except for such defaults the consequence of which, individually or in the
aggregate, would not result in and could not reasonably be expected to result in
a Material Adverse Effect.
(c) All permits required to have been issued to the
Borrowers or their Subsidiaries with respect to the real property owned or
leased by the Borrowers or any of their Subsidiaries to enable such property to
be lawfully occupied and used for all of the purposes for which it is currently
occupied and used (separate and apart from any other properties), have been
lawfully issued and are in full force and effect, and all such real property
complies in all material respects with all applicable legal and insurance
requirements,
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except where the failure to obtain such permits or instances of non-compliance
with applicable legal and insurance requirements, individually or in the
aggregate, would not result in and could not reasonably be expected to result in
a Material Adverse Effect.
(d) No portion of any real property owned or leased
by the Borrowers or any of their Subsidiaries has suffered any damage by fire or
other casualty loss which has not heretofore been completely repaired and
restored to its condition existing prior to such casualty or which if not
repaired or restored is not reasonably likely to result in a Material Adverse
Effect. Except as disclosed to the Agent in writing, no portion of any of the
real property owned or leased by the Borrowers or any of their Subsidiaries is
located in a special flood hazard area as designated by any Governmental
Authority.
7.21. Location of Bank Accounts. Schedule 7.21 hereto sets
forth a complete and accurate list as of the Closing Date of all deposit and
other accounts, including the Cash Concentration Account and all Depository
Accounts, maintained by the Borrowers and their respective Subsidiaries together
with a description thereof (i.e., the bank at which such deposit or other
account is maintained and the account number and the purpose thereof).
7.22. No Event of Default. No event has occurred and is
continuing and no condition exists which constitutes an Event of Default or
Potential Default.
7.23. Capitalized Leases. As of the Closing Date, Capitalized
Lease Obligations of the Borrowers and their respective Subsidiaries (other than
Inactive Guarantors) do not exceed $5,000,000 in the aggregate.
7.24. Inventory and Memorabilia. There is no location at which
the Borrowers and the Guarantors have any Inventory or Memorabilia (except for
Inventory and Memorabilia in transit) other than (i) those locations listed on
Schedule 1.01(B) hereto, and (ii) any other locations approved in writing by the
Agent pursuant to the definition of "Eligible Inventory". Schedule 1.01(B)
hereto contains a true, correct and complete list, as of the Closing Date, of
the legal names and addresses of each warehouse at which Inventory and
Memorabilia of the Borrowers is stored. None of the receipts received by the
Borrowers from any warehouse states that the goods covered thereby are to be
delivered to bearer or to the order of a named Person or to a named Person and
such named Person's assigns.
7.25. Collateral. The Borrowers and the Guarantors have good
and marketable title to the Collateral.
7.26. Tradenames. Schedule 7.26 hereto sets forth a complete
and accurate list as of the Closing Date of all tradenames used by the Borrowers
and their Subsidiaries.
7.27. Intellectual Property. Each of the Borrowers and their
Subsidiaries owns or licenses or otherwise has the right to use all material
licenses, permits, patents, patent applications, trademarks, trademark
applications, service marks, trade names, copyrights, copyright applications,
franchises, authorizations and other intellectual property rights that are
necessary for the operations of their respective businesses and the ownership
and sale of Memorabilia and, to the knowledge of each such Borrower or each such
U.S. Subsidiary, without
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infringement upon or conflict with the rights of any other Person with respect
thereto, except where the failure to obtain the right to use licenses, permits,
patents, patent applications, trademarks, trademark applications, service marks,
trade names, copyrights, copyright applications, franchises, authorizations and
other intellectual property rights that are necessary for the operations of
their respective businesses and the ownership and sale of Memorabilia, and
infringements upon and conflicts with respect thereto which, individually or in
the aggregate, would not result in and could not reasonably be expected to
result in a Material Adverse Effect. To the best knowledge of the Borrowers and
their Subsidiaries, no slogan or other advertising device, product, process,
method, substance, part or other material now employed, or now contemplated to
be employed, by the Borrowers or any of their Subsidiaries infringes upon or
conflicts with any rights owned by any other Person, and no claim or litigation
regarding any of the foregoing is pending or threatened, except where such
infringements, conflicts and pending or threatened litigation, individually or
in the aggregate, would not result in and could not reasonably be expected to
result in a Material Adverse Effect. To the knowledge of the Borrowers and their
Subsidiaries, no patent, invention, device, application, principle or any
statute, law, rule, regulation, standard or code is pending or proposed, which,
individually or in the aggregate, would result in or could reasonably be
expected to result in a Material Adverse Effect.
7.28. Regulation T, U or X. The Borrowers are not and will not
be engaged in the business of extending credit for the purpose of purchasing or
carrying margin stock (within the meaning of Regulation T, U or X issued by the
Board), and no proceeds of any Loan will be used to purchase or carry any margin
stock or to extend credit to others for the purpose of purchasing or carrying
any margin stock.
7.29. Nature of Business. The Borrowers are not engaged in any
business other than (i) the operation of restaurants and retail stores selling
Planet Hollywood-related and Official All-Star Cafe-related merchandise, and
(ii) the sale and licensing of intellectual property and merchandise related
thereto, and the operation of websites in connection therewith and other
reasonably related activities (subject to the restrictions contained in the Loan
Documents related to the Memorabilia (including without limitation, the minimum
sales price and application of Net Proceeds)).
7.30. Adverse Agreements, Etc. Neither the Borrowers nor any
of their Subsidiaries is a party to any agreement or instrument, or subject to
any charter or other corporate restriction or any judgment, order, regulation,
ruling or other requirement of a court or other Governmental Authority or
regulatory body, which would result in a Material Adverse Effect, or, to the
best knowledge of the Borrowers, could reasonably be expected to result in a
Material Adverse Effect.
7.31. Holding Company and Investment Company Acts. Neither the
Borrowers nor any of their Subsidiaries is (i) a "holding company" or a
"subsidiary company" of a "holding company" or an "affiliate" of a "holding
company", as such terms are defined in the Public Utility Holding Company Act of
1935, as amended, or (ii) an "investment company" or an "affiliated person" or
"promoter" of, or "principal underwriter" of or for, an "investment company", as
such terms are defined in the Investment Company Act of 1940, as amended.
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7.32. Permits, Etc. The Borrowers and their Subsidiaries have
all material permits, licenses, authorizations and approvals required for them
lawfully to own and operate their business.
7.33. Priority; Title. The Liens granted under the Security
Documents constitute, and shall at all times constitute, perfected, first
priority Liens on the Collateral. The Collateral is subject to no other Liens
other than Permitted Liens, and the Borrowers are the sole and absolute owner of
all of the Collateral with full right to pledge, sell, consign, transfer and
create Liens therein. No Person has any right of first refusal, option or other
preferential right to purchase any Collateral. The Borrowers will at their
expense warrant and, at the Agent's request, defend the same from any and all
claims and demands of any other Person other than the Permitted Liens. The
Borrowers will not grant, create or permit to exist, any Lien upon the
Collateral, or any proceeds thereof, in favor of any other Person other than
Permitted Liens. The Borrowers and their Subsidiaries have good and marketable
title or a valid leasehold interest in all of their properties and assets, free
and clear of all Liens except Permitted Liens.
7.34. Labor Relations; Collective Bargaining Agreements.
(a) Set forth on Schedule 7.34 hereto is a list
(including dates of termination) of all collective bargaining agreements between
or applicable to the Borrowers or any of their U.S. Subsidiaries and any union,
labor organization or other bargaining agent in respect of the employees of the
Borrowers or any of such U.S. Subsidiaries.
(b) Neither the Borrowers nor any of their U.S.
Subsidiaries is engaged in any unfair labor practice that would result in or
could reasonably be expected to result in a Material Adverse Effect. There is
(i) no significant unfair labor practice complaint pending against the Borrowers
or any of their U.S. Subsidiaries or, to the best knowledge of the Borrowers or
any of their U.S. Subsidiaries, threatened against any of them, before the
National Labor Relations Board, and no significant grievance or significant
arbitration proceeding arising out of or under any Collective Bargaining
Agreement is now pending against the Borrowers or any of their U.S. Subsidiaries
or, to the best knowledge of the Borrowers or any of their U.S. Subsidiaries,
threatened against any of them, (ii) no significant strike, labor dispute,
slowdown or stoppage is pending against the Borrowers or any of their U.S.
Subsidiaries or, to the best knowledge of the Borrowers or any of their U.S.
Subsidiaries, threatened against the Borrowers or any of their U.S.
Subsidiaries, and (iii) to the best knowledge of the Borrowers or any of their
U.S. Subsidiaries, no union representation question existing with respect to the
employees of the Borrowers or any of their U.S. Subsidiaries, except (with
respect to any matter specified in clause (i), (ii) or (iii) above, either
individually or in the aggregate) where such actual or threatened complaint,
grievance, or arbitration proceeding, strike, labor dispute, slowdown or
stoppage, or union representation question would not result in and could not
reasonably be expected to result in a Material Adverse Effect.
7.35. Loan Documents. The Loan Documents create and grant to
the Agent, for the benefit of the Lenders, a legal, valid and perfected first
priority Lien on the Collateral, subject to no other Liens except for Permitted
Liens.
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7.36. Solvency. After giving effect to the transactions
contemplated by this Agreement and the Related Documents and each Credit
Extension, the Borrowers and the Guarantors are, on a consolidated basis,
Solvent.
7.37. Ownership of Planet Hollywood Memorabilia, Inc. and the
Memorabilia. As of the date hereof, (i) Planet Hollywood owns one hundred
percent (100%) of Planet Hollywood Memorabilia, Inc., (ii) Planet Hollywood
Memorabilia, Inc. owns one hundred percent (100%) of the Memorabilia, all of
which was duly and properly transferred from Planet Hollywood to it pursuant to
an order, dated December 13, 1999, of the United States District Court for the
District of Delaware, and (iii) prior to the transfer described in clause (ii)
hereof, Planet Hollywood was the sole owner of and had good and marketable title
to one hundred percent (100%) of the owned Memorabilia.
7.38. Corporate Structure. The corporate chart evidencing the
corporate structure of the Borrowers and the Guarantors annexed as Schedule 7.38
hereto accurately reflects as of the Closing Date the corporate structure of the
Borrowers and the Guarantors in all material respects.
7.39. Delivery of Authenticity Documents. The Authenticity
Documents shall be promptly delivered to the Memorabilia Agent within ten (10)
days of the Closing Date (x) in a form to facilitate retrieval of such Documents
(notated by item number corresponding to the Memorabilia Report), and (y)
accompanied by a master list of the Authenticity Documents being delivered.
7.40. Material Contracts. Schedule 7.40 hereto sets forth a
complete listing of all Material Contracts.
7.41. [Intentionally omitted].
7.42. TSP Agreement.
(a) TSP Agreement. The Borrower has delivered to the
Agent a true and complete copy of the TSP Agreement. Except for the TSP
Agreement, there are no documents, instruments or agreements affecting or with
respect to the Membership Interest to which the Borrower or any of its
Subsidiaries is a party or bound or under which the Borrower or any of its
subsidiaries has any interest or estate, or which are binding on the Membership
Interest. The TSP Agreement is the valid and binding obligation of each of the
Borrower or any of its Subsidiaries that is a party thereto, enforceable against
and by each such Borrower or any of its Subsidiaries in accordance with its
terms except (i) as limited by application bankruptcy, insolvency,
reorganization, moratorium or other laws of general application affecting
enforcement of creditors' rights and (ii) general principles of equity that
restrict the availability of equitable remedies.
(b) Title. Hospitality has good and marketable right,
title and interest in, to and under the Membership Interest, free and clear of
any Liens, except for the Permitted
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Liens and the right of first refusal of the other members of TSP under and in
accordance with the terms of the TSP Agreement.
(c) No Default. No default or event of default has
occurred under or with respect to the TSP Agreement, pursuant to the terms
thereof. Hospitality has fully performed all of its obligations under the TSP
Agreement which are required to be performed on or prior to the date hereof, and
its right, title and interest of any Borrower or any of its Subsidiaries in the
Membership Interest is not subject to any defense, offset, counterclaim or claim
(other than Permitted Liens), nor have any of the foregoing been asserted or
alleged against any Borrower or any of its Subsidiaries with respect to the
Membership Interest, nor has any Borrower or any of its Subsidiaries asserted
any of the same against any other party to the TSP Agreement.
(d) Consents. all consents, licenses, approvals and
authorizations of, or designations or declarations with, any Governmental
Authority or any other Person required to be obtained, effected, given or
received in connection with the execution, delivery and performance of the TSP
Agreement by any Borrower or any of its Subsidiaries have been duly obtained,
effected, given and received, are in full force and effect and do not subject
the provisions of the Membership Interest to any limitation, either specific or
general in nature.
(e) Members and Membership Interests. Schedule 7.42
hereto sets forth or attaches a true and complete list setting forth (i) each
member of TSP, (ii) the percentage membership interest in TSP currently owned by
each such Person, (iii) the current balance of such person's capital account in
TSP, (iv) a copy of each Schedule K-1 received by the Borrower or any of its
Subsidiaries with respect to the Membership Interest and each tax return filed
by TSP, and (v) a description, including the principal amount, interest, term
and lender, of all debt of TSP.
7.43. Additional Representations and Warranties. With respect
to advances subsequent to the initial advances, such other representations and
warranties as shall be satisfactory to the Agent in its reasonable discretion
and which are customary to transactions of this nature.
ARTICLE VIII
AFFIRMATIVE COVENANTS
---------------------
So long as any principal of or interest on the Loans or the
Reimbursement Obligations or any other Obligations (whether or not due) shall
remain unpaid or the Lenders shall have any Revolving Credit Commitment
hereunder, the Borrowers will, unless the Majority Lenders shall otherwise
consent in writing (there being no requirement under this Article VIII (except
Section 8.09) that encompasses or otherwise applies to the Inactive Guarantors):
8.01. Reporting Requirements. Furnish to the Lenders:
(a) As soon as practicable and in any event within
ninety (90) days after the close of each fiscal year of Planet Hollywood, a
consolidated (and consolidating)
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statement of operations and cash flows of Planet Hollywood and its Consolidated
Subsidiaries for such fiscal year and a consolidated (and consolidating) balance
sheet of Planet Hollywood and its Consolidated Subsidiaries as of the close of
such fiscal year, and notes to each, all in reasonable detail, setting forth in
comparative form the corresponding figures for the preceding fiscal year, which
statements and balance sheet shall be certified by PricewaterhouseCoopers or
other independent certified public accountants of recognized national standing
selected by the Borrowers and reasonably satisfactory to the Agent. The
certificate or report of such accountants (the "Accountant's Opinion") shall be
without an exception or qualification arising out of the scope of the audit with
respect to such statements and balance sheet being prepared in compliance with
GAAP and shall in any event contain a written statement of such accountants
substantially to the effect that (i) such accountants examined such statements
and balance sheet in accordance with generally accepted auditing standards and
accordingly made such tests of accounting records and such other auditing
procedures as such accountants considered necessary in the circumstances, and
(ii) in the opinion of such accountants such statements and balance sheet
present fairly, in all material respects, the financial position of Planet
Hollywood and its Consolidated Subsidiaries as of the end of such fiscal year
and the results of its operations and the changes in its financial position for
such fiscal year, in conformity with GAAP (except for changes in application in
which such accountants concur). A copy of the Accountant's Opinion shall be
delivered to the Agent and each Lender and signed by such independent public
accountants. Each set of statements and balance sheets delivered pursuant to
this Section 8.01(a) shall be accompanied by a certificate dated the date of the
delivery of such statements and balance sheet by the Designated Financial
Officer stating in substance that he has reviewed this Agreement and that in
making the examination necessary for this certification, he did not become aware
of any Event of Default or Potential Default, or if he did become so aware, such
certificate shall state the nature and period of existence thereof if
determinable.
(b) As soon as practicable and in any event within
forty-five (45) days after the close of each fiscal quarter of Planet Hollywood,
unaudited consolidated (and consolidating) statements of operations and cash
flows of Planet Hollywood and its Consolidated Subsidiaries and an unaudited
consolidated (and consolidating) balance sheet of Planet Hollywood and its
Consolidated Subsidiaries as of the close of such fiscal quarter, all in
reasonable detail setting forth in comparative form the corresponding figures
for the corresponding fiscal quarter for the preceding fiscal year, which
statements and balance sheet shall be certified by the Designated Financial
Officer as presenting fairly, in all material respects, the financial position
of Planet Hollywood and its Consolidated Subsidiaries as of the end of such
quarter and the results of its operations and the changes in its financial
position for such quarter, in conformity with GAAP applied in a manner
consistent except as otherwise disclosed therein with that of the most recent
audited financial statements furnished to the Lenders, subject to year-end
adjustments. Each set of statements and balance sheets delivered pursuant to
this Section 8.01(b) shall be accompanied by a certificate of the Designated
Financial Officer dated the date of the delivery of such statements and balance
sheet stating that he has reviewed this Agreement and that to the best of his
knowledge he did not become aware of any Event of Default or Potential Default,
or if he did become so aware, such certificate shall state the nature and period
of existence thereof, if determinable.
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(c) As soon as practicable and in any event within
thirty (30) days after the end of each fiscal month of Planet Hollywood that is
not the end of a fiscal quarter, unaudited consolidated (and consolidating)
statements of operations and cash flows for Planet Hollywood and its
Consolidated Subsidiaries for such fiscal month and for the period from the
beginning of such fiscal year to the end of such fiscal month, and an unaudited
consolidated (and consolidating) balance sheet of Planet Hollywood and its
Consolidated Subsidiaries as of the end of such fiscal month, all in reasonable
detail, setting forth in comparative form the corresponding figures for the
corresponding fiscal month during the preceding fiscal year (except for the
balance sheet, which shall set forth in comparative form the corresponding
balance sheet as of the prior fiscal year end), and accompanied by a certificate
of the Designated Financial Officer stating that (i) such statements present
fairly, in all material respects, the financial position of Planet Hollywood and
its Consolidated Subsidiaries as of the end of such fiscal month and the results
of its operations and cash flows for such fiscal month, in conformity with GAAP
applied in a manner consistent except as otherwise disclosed therein with that
of the most recent adjusted financial statements furnished to the Lenders,
subject to year-end adjustments, and (ii) he has reviewed this Agreement and
that to the best of his knowledge he did not become aware of any Event of
Default or Potential Default, or if he did become so aware, such certificate
shall state the nature and period of existence thereof, if determinable.
(d) As soon as practicable and in any event on the
third (3rd) Business Day of each week (including the week in which this
Agreement is executed) or at any other time, at the discretion of the Agent, a
Borrowing Base Certificate for the Borrowers as of Planet Hollywood's close of
business on the Saturday of the preceding week, each in form and substance
reasonably satisfactory to the Agent and certified by the Designated Financial
Officer; provided, however, that if there are no Loans hereunder the aforesaid
weekly requirement shall be changed to a twice monthly requirement.
(e) As soon as possible, and in any event within five
(5) days, after the occurrence of a Potential Default or an Event of Default or
a Material Adverse Effect with respect to any Borrower, the written statement of
the Designated Financial Officer of such Borrower, setting forth the details of
such Potential Default or Event of Default, Material Adverse Effect and the
action which such Borrower proposes to take with respect thereto.
(f) (i) By 12:00 noon New York City time three (3)
Business Days after Sunday of each week, or more often if requested by the
Agent, a report of all Memorabilia that was, during such week, (i) bought, sold
or otherwise disposed of by the Borrowers and the Guarantors, or (ii)
transferred or moved by the Borrowers and the Guarantors, including, without
limitation, the old and the new location for each such item of Memorabilia so
transferred or moved, in each case, unless the aggregate of all such Memorabilia
bought, sold, transferred or moved has a Book Value at any time of less than
$50,000 (the "Memorabilia Change Report"); provided, however, that (x) any such
purchases, sales, transfers or movements must be made in accordance with the
terms of this Agreement, (y) such Memorabilia Change Report may be made part of
the Borrowing Base Certificate and (z) in calculating the Book Value of
Memorabilia aggregating $50,000 as aforesaid, transfers and other movements of
Memorabilia among Borrowers and Guarantors to locations where the Agent has
filed a UCC financing statement are not required to be counted in the
calculation of such $50,000 threshold.
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(ii) On the last day of each fiscal quarter (or
such more frequent period as is required by the Agent), the Memorabilia Report.
(g) Promptly after receipt by any Borrower, copies of
all accountants' management letters, business plans and other reports which have
direct or indirect bearing on the Collateral.
(h) Promptly upon becoming available, a copy of (i)
all reports, financial statements or other information delivered by any Borrower
to its shareholders, (ii) all reports, proxy statements, financial statements
and other information generally distributed by any Borrower to its creditors or
the financial community in general, and (iii) any audit or other reports
submitted to any Borrower by independent accountants in connection with any
annual, interim or special audit of such Borrower.
(i) On the last day of each fiscal month, a
certification of the Designated Financial Officer indicating that all rent and
other charges due and payable by the Borrowers with respect to the Leases are
current, and that no default has occurred or is continuing (after giving effect
to grace periods) pursuant to any of the Leases as of the date of such
certification; provided, however, that, in the event any of the foregoing
payments are due and payable (whether or not disputed) or a potential default
exists under one or more of the Leases, then such certification shall identify
all such outstanding payments and defaults.
(j) (i) As soon as possible and in any event within
ten (10) days after any Borrower or any ERISA Affiliate knows or has reason to
know that a Termination Event with respect to any Plan has occurred, or that any
Borrower or any ERISA Affiliate has failed to make a required installment to a
Plan within the meaning of Section 412(m) of the Code, a statement of the
Financial Officer of such Borrower describing such Termination Event and the
action, if any, which such Borrower or ERISA Affiliate proposes to take with
respect thereto, (ii) promptly and in any event within two (2) Business Days
after receipt thereof by any Borrower or any ERISA Affiliate from the PBGC,
copies of each notice received by such Borrower or any ERISA Affiliate of the
PBGC's intention to terminate any Plan or to have a trustee appointed to
administer any Plan, (iii) promptly and in any event within thirty (30) days
after the filing thereof with the Internal Revenue Service, copies of each
Schedule B (Actuarial Information) to the annual report (Form 5500 Series) with
respect to each Plan and Multiemployer Plan, (iv) promptly and in any event
within five (5) Business Days after receipt thereof by any Borrower or any ERISA
Affiliate from a sponsor of a Multiemployer Plan or from the PBGC, a copy of
each notice received by such Borrower or any ERISA Affiliate concerning the
imposition or amount of withdrawal liability under Section 4202 of ERISA or
indicating that such Multiemployer Plan may enter reorganization status under
Section 4241 of ERISA, (v) promptly and in any event within ten (10) days after
any Borrower or any ERISA Affiliate takes action to establish an employee Plan
as defined in Section 3(3) of ERISA, a statement of the Financial Officer of
such Borrower describing such employee Plan and a copy of such employee Plan,
and (vi) promptly and in any event within five (5) days after any Borrower files
any notice with the PBGC under Section 4043(b) of ERISA, a copy of such notice.
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(k) Promptly after, and in any event within five (5)
days after, an officer of any Borrower learns of any of the following, notice
thereof:
(i) the receipt by such Borrower or any of its
Subsidiaries of notification that any real or personal property of such Borrower
or its Subsidiaries is subject to any Environmental Lien;
(ii) notice of violation of any Environmental Law
which could reasonably be expected to subject such Borrower or any of its
Subsidiaries to Environmental Liabilities and Costs of $500,000 or more; or
(iii) notice of the commencement of any judicial
or administrative proceeding or investigation alleging a violation by such
Borrower or any of its Subsidiaries of any Environmental Law, which if adversely
determined, could reasonably be expected to subject such Borrower or any of its
Subsidiaries to Environmental Liabilities and Costs of $500,000 or more.
(l) Promptly after submission to any Governmental
Authority all documents and information furnished to such Governmental Authority
in connection with any investigation of any of the Borrowers or any of their
respective Subsidiaries which, if adversely determined, could result in a
Material Adverse Effect; provided, however, that the Borrowers and their
respective Subsidiaries shall not be required to disclose any documents and
information that counsel has advised the Borrowers should not be disclosed under
any applicable law.
(m) Promptly upon request, such other information
concerning the condition or operations, financial or otherwise, of the Borrowers
or any of their respective Subsidiaries as the Agent or any Lender from time to
time may reasonably request.
(n) Promptly after the commencement thereof but in
any event not later than five (5) days after service of process with respect
thereto on, or the obtaining of knowledge thereof by, the Borrowers or any of
their Subsidiaries, notice of each action, suit or proceeding involving the
Borrowers or any of their Subsidiaries before any court or other Governmental
Authority or other regulatory body or any arbitrator which, if adversely
determined, could result in a Material Adverse Effect.
8.02. Compliance with Laws, Etc. Comply and cause each of
their respective Subsidiaries to comply, with all applicable Laws (including but
not limited to Environmental Laws and compliance in respect of products that
they sell or service they perform, conduct of their businesses, or use,
maintenance or operation of real and personal properties owned or possessed by
them), except, in the case of instances of non-compliance (other than
non-compliance in the payment of Taxes which, if unpaid, could result in a Lien
on any Collateral or any other non-compliance that may result in a Lien on any
Collateral), where such instances of non-compliance, individually or in the
aggregate, will not result in and could not reasonably be expected to result in
a Material Adverse Effect.
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8.03. Preservation of Existence, Etc. Subject to Section
9.04(b) hereof, maintain and preserve, and cause each of their respective
Subsidiaries to maintain and preserve its existence, rights and privileges, and
become or remain duly qualified and in good standing in each jurisdiction in
which the character of the properties owned or leased by them or in which the
transaction of their business makes such qualification necessary, except where
instances of failure to qualify or remain in good standing or failure to
maintain rights and privileges, individually or in the aggregate, will not
result in and could not reasonably be expected to result in a Material Adverse
Effect.
8.04. Keeping of Records and Books of Account. Keep, and cause
each of their respective Subsidiaries (other than Inactive Guarantors) to keep,
adequate records and books of account, with complete entries made in accordance
with GAAP.
8.05. Inspection Rights.
(a) Permit, and cause each of their respective
Subsidiaries to permit, the Agent or any Lender, or any agents or
representatives thereof or such professionals or other Persons as the Agent may
designate (i) to examine and inspect the books and records of any of the
Borrowers and their Subsidiaries and take copies and extracts therefrom, (ii) to
verify materials, leases, notes, receivables, deposit accounts and other assets
and liabilities of the Borrowers and their Subsidiaries from time to time, and
(iii) to conduct Inventory and Memorabilia (including, without limitation, the
Eligible Memorabilia) appraisals and/or valuations at the distribution centers
and retail stores of the Borrowers and their Subsidiaries; provided, however,
that, in the absence of a continuing Event of Default, (A) the Agent and its
representatives shall be limited to four (4) visits per calendar year to Planet
Hollywood's corporate headquarters (or such other locations if deemed necessary
by the Agent) for purposes of conducting any such actions described in clauses
(i) through (iv) above, with all expenses related to such visits to be borne by
Planet Hollywood in accordance with Section 8.05(c) hereof, and (B) all such
actions described in clauses (i) through (iv) above shall be conducted at
reasonable times and during normal business hours. In addition, the Borrowers
and their Subsidiaries will cause to be conducted a physical inventory count on
or about March 31, 2000 and shall promptly after such count becomes available
provide to the Agent a copy of the written results of such physical Inventory
count. The Lender will endeavor to minimize the disruption of such Borrower's
business in connection with the exercise of its rights under this paragraph.
(b) Permit, and cause the Subsidiaries to permit, the
Agent or any Lender, or any agents or representatives thereof or such
professionals or other Persons as the Agent may designate to examine and
re-evaluate the value of the Collateral, including, without limitation, the
Memorabilia.
(c) All reasonable out-of-pocket expenses of the
Agent or the Lenders, as the case may be, in connection with the inspection
rights set forth in subsections 8.05(a) and 8.05(b) shall be payable by the
Borrowers directly or at the option of the Agent through direct charges to the
Borrowers' Account; such expenses shall include, without limitation, the (i)
reasonable fees and expenses including with respect to retaining a third party
consultants, (ii) reasonable out-of-pocket travel expenses (including those
incurred in connection with periodic
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field audits by employees of the Agent or the Lenders, as the case may be),
(iii) reasonable out-of-pocket fees and expenses incurred by the Agent or the
Lenders, as the case may be, in connection with the monitoring of the
Collateral, and (iv) out-of-pocket messenger and delivery expenses, and out-of
pocket duplicating expenses. So long as no Event of Default has occurred and is
continuing, the Agent and the Lenders agree to advise the Borrowers of their
respective intention to retain third parties (other than legal counsel) at any
time after the Closing Date and to consult with the Borrowers regarding same.
The Borrowers shall also pay on demand directly or at the option of the Agent
through direct charges to the outstanding balance of the Loans all reasonable
out-of-pocket costs and expenses incurred by the Agent or the Lenders, as the
case may be, in connection with any litigation, contest, dispute, suit or
proceeding relating to the Loan Documents or the transactions contemplated
hereby. The Agent or the Lenders, as the case may be, shall deliver to Planet
Hollywood a reasonably detailed statement of expenses in advance of the Agent
charging the Borrowers' Account.
8.06. Maintenance of Properties, Etc. Maintain and preserve,
and cause each of their respective Subsidiaries to maintain and preserve, all of
their properties (including all real properties leased or owned by them) which
are necessary or useful in the proper conduct of their business in good working
order and condition, ordinary wear and tear excepted, and comply, and cause each
of their respective Subsidiaries to comply, at all times with the provisions of
all Leases to which each of them is a party as lessee or under which each of
them occupies property, so as to prevent any loss or forfeiture thereof or
thereunder, except where any failure to maintain and preserve their properties
or failure to comply with the provisions of their Leases, individually or in the
aggregate, would not result in and could not reasonably be expected to result in
a Material Adverse Effect.
8.07. Maintenance of Insurance.
(a) Maintain, and cause each of their respective
Subsidiaries to maintain, with responsible and reputable insurance companies or
associations insurance (including, without limitation, comprehensive general
liability, hazard, rent and business interruption insurance) with respect to
their properties and business, in such amounts and covering such risks, as is
required by any Governmental Authority or other regulatory body having
jurisdiction with respect thereto or as is carried generally in accordance with
sound business practice by companies in similar businesses similarly situated
and in any event in amount, adequacy and scope reasonably satisfactory to the
Agent as of the Closing Date and with such deductibles or self-insured
retentions as are in accordance with normal industry practice and all applicable
laws, rules and regulations; provided, however, that in no event will any such
deductible or self-insured retention in respect of liability claims or in
respect of casualty damage exceed, in each such case, $250,000 per occurrence.
Each insurance policy referred to in this Section 8.07 shall specify the Agent
(for the benefit of the Lenders) as loss payee thereof and contain a standard
endorsement satisfactory to the Agent effecting such specification. All policies
covering the Collateral are to be made payable to the Agent, in case of loss,
under a standard non-contributory "lender" or "secured party" clause and are to
contain such other provisions as the Agent may require to fully protect the
Agent's interest in the Collateral and to any payments to be made under such
policies. All original policies or true copies thereof are to be delivered to
the Agent, premium prepaid, with the additional insured endorsement in the
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Agent's favor, and shall provide for not less than thirty (30) days prior
written notice to the Agent of the exercise of any right of modification or
cancellation. So long as no Event of Default has occurred or is continuing,
amounts received by the Agent as payee shall, if in excess of $1,000,000, be
credited to the borrowings and shall be available for reborrowing, subject to
the terms and conditions hereof. Insurance proceeds of $1,000,000 or less may be
reinvested in the replacement of items which were the subject of the insurance
recovery. At the Borrowers' request, the Agent may arrange for such insurance,
but at the Borrowers' expense and without any responsibility on the Agent's part
for obtaining the insurance, the solvency of the insurance companies, the
adequacy of the coverage, or the collection of claims.
(b) After the Closing Date, Planet Hollywood shall
have the right to change insurance carriers to one or more other insurance
carriers having the same "Best" rating or to modify existing insurance policies
upon notice to the Agent without the Agent's consent; provided, however, that on
the effective date of such changes and modifications, (i) the Borrowers remain
insured in such amounts and covering such risks as is required by any
Governmental Authority or other regulatory body having jurisdiction with respect
thereto, (ii) such insurance is adequate in amount and scope as is carried
generally in accordance with sound business practice by companies in similar
businesses similarly situated, (iii) the amount, adequacy and scope of such
insurance is substantially similar to that in existence as of the Closing Date,
and (iv) a loss payee endorsement is delivered to Agent simultaneously with the
effective date thereto (there being no grace period for any Event of Default
based on the requirements of this Section 8.07(b)).
(c) Upon the occurrence and during the continuance of
an Event of Default, the Agent on behalf of the Lenders shall have the sole
right, in the name of the Agent and the Borrowers, to file claims under any
insurance policies insuring any of the Collateral, provided that the Agent gives
prompt notice thereof to the Borrowers, to receive, receipt and give acquittance
for any payments that may be payable thereunder, and to execute any and all
endorsements, receipts, releases, assignments, reassignments or other documents
that may be necessary to effect the collection, compromise or settlement of any
claims under any such insurance policies.
8.08. Environmental. Comply, and cause each of their
respective Subsidiaries to comply, with the requirements of all Environmental
Laws and provide to the Agent all documentation in connection with such
compliance that the Agent may reasonably request; and not cause or permit the
Collateral or any property or facility owned, operated or occupied by the
Borrowers or their Subsidiaries to be used for any activities involving,
directly or indirectly, the use, generation, treatment, storage, release or
disposal of any Hazardous Materials, except in compliance with applicable Laws
and except where instances of non-compliance with the requirements of all
Environmental Laws or the use of the Collateral or any property or facility
owned, operated or occupied by the Borrowers or their Subsidiaries for any
activities involving, directly or indirectly, the use, generation, treatment,
storage, release or disposal of any Hazardous Materials, individually or in the
aggregate, would not result in and could not reasonably be expected to result in
a Material Adverse Effect. On behalf of the Borrowers and their Subsidiaries,
the Borrowers hereby agree to defend, indemnify, and hold harmless the Agent,
the Lenders and the Letter of Credit Issuer, their employees, agents, officers,
and directors, from and
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against any claims, demands, penalties, fines, liabilities (including strict
liability), settlements, damages, costs, or expenses (including, without
limitation, attorney and consultant fees, investigation and laboratory fees,
court costs, and litigation expenses) and Environmental Liabilities and Costs
arising out of (i) any Release, or threatened Release on any property presently
or formerly owned or occupied by any of the Borrowers or their Subsidiaries (or
their predecessors in interest or title) or at any disposal facility which
received Hazardous Materials generated by the Borrowers or their respective
Subsidiaries, (ii) any violation of Environmental Laws, (iii) any Environmental
Actions, (iv) any personal injury (including wrongful death) or property damage
(real or personal) arising out of or related to exposure to Hazardous Materials
used, handled, generated, transported or deposited by the Borrowers or their
respective Subsidiaries (or any predecessor in interest or title), and/or (v)
the breach of any representation or warranty made by the Borrowers in Section
7.14 hereof or the breach of any covenant made by any of the Borrowers or their
Subsidiaries in this Section 8.08. This Environmental Indemnity shall survive
the repayment of the Obligations and discharge or release of any security
interest granted under the Loan Documents.
8.09. Further Assurances. Do, execute, acknowledge, deliver,
record, file, register and perform and cause each of their respective U.S.
Subsidiaries (or any other entity as to which the Lenders at any time have a
Lien on the assets or ownership interest thereof) to do, execute, acknowledge,
deliver, record, file, register and perform at the sole cost and expense of the
Borrowers all such further acts, deeds, conveyances, mortgages, assignments,
estoppel certificates, financing statements, notices of assignment, transfers
and assurances as the Agent may reasonably require from time to time in order
(a) to carry out more effectively the purposes of this Agreement or any other
Loan Document, (b) to subject to valid and perfected first priority Liens all
the Collateral, (c) to perfect and maintain the validity, effectiveness and
priority of any of the Loan Documents and the Lien intended to be created
thereby, and (d) to better assure, convey, grant, assign, transfer and confirm
unto the Agent, the Lenders and the Letter of Credit Issuer the rights now or
hereafter intended to be granted to the Agent, the Lenders and the Letter of
Credit Issuer under this Agreement, any Loan Document or any other instrument
under which the Borrowers or the Subsidiaries may be or may hereafter become
bound to convey, mortgage or assign to the Agent, the Lenders and the Letter of
Credit Issuer.
8.10. Financial Accounting Practices, Etc.
(a) Make and keep books, records and accounts which,
in reasonable detail, accurately and fairly reflect the transactions and
dispositions of assets of the Borrowers and their Subsidiaries and maintain a
system of internal accounting controls sufficient to provide reasonable
assurances that (i) transactions are executed in accordance with management's
general or specific authorization, (ii) transactions are recorded as necessary
(A) to permit preparation of financial statements in conformity with GAAP, and
(B) to maintain accountability for assets, and (iii) the recorded accountability
for assets is compared with the existing assets at reasonable intervals and
appropriate action is taken with respect to any differences.
(b) Maintain a system of internal procedures and
controls sufficient to provide reasonable assurance that the information
required to be set forth in each Borrowing Base Certificate (including, without
limitation, information relating to the identification of assets
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which are Eligible Inventory and Eligible Memorabilia as provided herein and the
valuation thereof) is accurate in all material respects.
8.11. Cash Management System.
(a) The Borrowers agree and covenant to (i) cause all
cash and all proceeds from Receivables, other accounts receivable, and the sale
of Inventory and Memorabilia or any other Collateral to be deposited into the
Depository Accounts in the ordinary course of business of each of the Borrowers
consistent with past practice but in any event not less than twice each week,
(ii) cause all remittances on credit card sales to be transferred from the
Depository Account into the Blocked Account on a daily basis (or to be sent
directly into the Blocked Account), (iii) cause all funds in the Depository
Accounts to be transferred into the Blocked Account in the ordinary course of
business of each of the Borrowers consistent with past practice but in any event
not less than twice each week except for the amounts needed to make the payments
to state taxing authorities in the amounts, to the states and with the periodicy
set forth in Schedule 8.11 for a period of up to sixty (60) days, such funds
transfer to be automatic and under the control of CIT pursuant to notice letters
to Depository Accounts Banks (or Depository Account Agreements reflecting same)
and Credit Card Obligors (iv) deposit the Net Cash Proceeds of Asset Sales in
the Blocked Account, (except to the extent such Net Cash Proceeds are not
required to be paid to the Agent hereunder and are required to be paid to the
Note Agent under the Note Purchase Agreement), (v) instruct the Agent to cause
all funds transferred to the Blocked Account to be applied to reduce the
Obligations outstanding from time to time, with excess amounts to be credited to
the Cash Concentration Account, (vi) take all such actions as the Agent deems
necessary or advisable to send all cash, all proceeds from the sale of Inventory
and Memorabilia, all remittances or other proceeds of Collateral to the Blocked
Account to be applied to the Obligations and (vii) on or before the Closing
Date, (A) execute and deliver to the Agent an original notice letter for each
Depository Bank listed on Schedule 7.21 to this Agreement, substantially in the
form of Exhibit K hereto, and use its best efforts to obtain the Depository
Account Agreements, (B) deliver to the Agent a credit card depository account
agreement, satisfactory to the Agent, duly executed by Planet Hollywood and each
credit card servicer of Planet Hollywood, and (C) take such other actions as the
Agent deems necessary or advisable to grant to the Agent dominion and control
over the funds in the Blocked Account. The requirements of this Section 8.11(a)
must be completed by the earlier of (a) any loans or advances to be made
hereunder or (b) twenty-five (25) days of the Closing Date.
(b) The Borrowers shall promptly, and in any event
not later than five (5) days, after the opening of any new Depository Account,
notify the Agent in writing of the creation of such new Depository Account and
shall at the time of such notice execute and deliver to the Agent a notice
letter, substantially in the form of Exhibit K hereto. Upon and during the
continuance of an Event of Default, the Borrowers shall, upon the request of the
Agent, use their best efforts to cause each Depository Bank maintaining a
Depository Account (which has not previously delivered the Depository Account
Agreement as aforesaid) to promptly, and in any event within twenty (20) days
after the date of such request, enter into a Depository Account Agreement. If,
after any such request by the Agent, any Borrower is unable to obtain a
Depository Account Agreement from any financial institution that receives
remittances or other proceeds of sales of Inventory or Memorabilia within such
thirty (30) day period, such Borrower
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shall promptly thereafter terminate such accounts and establish new accounts at
a financial institution that will enter into a Depository Account Agreement.
(c) Each Borrower shall promptly, and in any event
not later than five (5) days after the establishment of any new credit card
relationship, notify the Agent in writing of the creation of such new
relationship, shall at the time of such notice execute and deliver to the Agent
a Payment Direction Letter, substantially in the form of Exhibit J-1 hereto, and
shall use its best efforts (but not requiring any payment to be made by such
Borrower) to deliver to the Agent a credit card bank depository account
agreement, substantially in the form of Exhibit J hereto, duly executed by such
Borrower and such new credit card servicer.
8.12. Store Openings and Closings. At no time during the term
of this Agreement shall the Borrowers (i) close on a fiscal-year basis more than
eight (8) retail/restaurant locations in addition to those locations set forth
on Schedule 8.12, or (ii) open on a fiscal-year basis more than three (3) new
Borrower or Guarantor-owned locations.
8.13. Memorabilia and Inventory. The Borrowers shall maintain,
hold for safe-keeping and preserve the Memorabilia and Inventory, including,
without limitation, the Eligible Memorabilia and the Eligible Inventory, at all
locations including those originally located at closed stores in a manner
consistent with maintaining its maximum value. Subject to Section 8.14, the
Memorabilia and Inventory shall not be moved to any location outside the United
States of America or to any other location other than those locations listed on
Schedule 8.13 without the prior written consent of the Agent; provided, however,
that no such consent shall be required for Memorabilia moved outside the United
States to franchisees pursuant to contractual obligations with such franchisees
so long as advance written notification of same is provided to the Agent
adequately describing the Memorabilia so transferred and the Book Value
attributable to same so that the Agent may deduct such amount from the Borrowing
Base.
8.14. Change in Collateral; Collateral Records. Give the Agent
(a) not less than twenty (20) days' prior written notice of any change in the
location of any Collateral, other than to locations, that as of the date hereof,
are known to the Agent and at which the Agent has filed financing statements and
otherwise fully perfected its Liens thereon, and (b) prompt notice of any other
change in the location of any Collateral. Notwithstanding the foregoing, no
Memorabilia can be moved outside the United States or to franchisee locations
(unless the aggregate amount of Memorabilia moved from the date hereof to the
date of determination is $300,000 or less (based on Book Value), with exchanges
of Memorabilia being permitted within such limit) without (x) prior written
consent of the Agent (such consent not to be unreasonably withheld), and (y) a
dollar-for-dollar reduction of the Borrowing Base, based on Book Value
(multiplied by eighty percent (80%) (or the then advance rate of the Eligible
Memorabilia)), provided, however, that if, after such Memorabilia is so moved,
the Book Value of the remaining Eligible Memorabilia (multiplied by eighty
percent (80%) (or the then advance rate of the Eligible Memorabilia)) exceeds
the Memorabilia Sublimit (as determined in the sole discretion of the Agent),
the Borrowing Base shall not be so reduced. The Borrowers shall also advise the
Agent promptly, in sufficient detail, of any material adverse change relating to
the type, quantity or mix of the Collateral or the security interests granted
therein. The Borrowers agree to execute and deliver to the Agent for the benefit
of the Agent from time to time, the Memorabilia Report and
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such written statements and schedules as the Agent may reasonably require,
designating, identifying or describing the Collateral. The Memorabilia Report
shall be updated weekly to reflect any sale or other movement of Memorabilia.
The Borrowers' failure, however, to promptly give the Agent such statements or
schedules shall not affect, diminish, modify or otherwise limit the Agent's
security interest in the Collateral.
8.15. Leases. The Borrowers shall, and shall cause each of
their respective Subsidiaries, to (i) comply in all material aspects with all of
their respective obligations under Leases, and (ii) not modify, amend, extend or
otherwise change any of the terms, covenants or conditions of any such Leases if
such modification, amendment, extension or other change could reasonably be
expected to result in a Material Adverse Effect.
8.16. Landlord and Warehouse Waivers. Except to the extent
required to be delivered under Section 6.01 hereof prior to the Closing Date,
the Borrowers shall use their respective best efforts to obtain a landlord
waiver, in form and substance satisfactory to the Agent, to each of the
Borrower's and Guarantor's landlords identified on Schedule 8.16 hereto.
8.17. Authenticity Documents. In addition to the requirement
that Authenticity Documents be delivered to the Memorabilia Agent on the Closing
Date, the Borrowers shall, and shall cause each of their respective U.S.
Subsidiaries to, deliver subsequently acquired Authenticity Documents to the
Agent within ten (10) days of receipt thereof with respect to each item of
Memorabilia whether now owned or hereafter acquired. Planet Hollywood shall be
solely responsible for identifying such Authenticity Documents in a manner that
will facilitate retrieval by the Memorabilia Agent of Authenticity Documents.
8.18 TSP Agreement.
(a) Compliance with Documents. Hospitality will
perform, observe and comply in all material respects with all of its obligations
under the TSP Agreement, and will use its best efforts to cause each other party
to the TSP Agreement to perform, observe and comply in all material respects
with all of such other party's obligations under the TSP Agreement, and also
with all mortgages and all other agreements with respect to the ownership, use
and operation of the Membership Interest.
(b) No Modifications, Waivers or Extensions. No
Borrower or any of its Subsidiaries shall (i) amend, modify, terminate or waive
any provision of the TSP Agreement or vote to permit the amendment,
modification, termination or waiver of the TSP Agreement or any provision of any
such document, (ii) fail to exercise promptly and diligently each and every
material right which it may have under the TSP Agreement (other than any right
of termination or "put" right or other right the exercise of which would be
adverse to the interests of the Borrower or any of its Subsidiaries or the Agent
hereunder, which rights it shall not exercise without the Agent's prior written
consent) or (iii) fail to deliver the Agent a copy of each demand, notice or
document received or given by its relating in any way to the TSP Agreement or
the Membership Interest. In no event shall Hospitality withdraw from or cause or
consent to the dissolution of TSP.
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ARTICLE IX
NEGATIVE COVENANTS
------------------
So long as any principal of or interest on the Loans or the
Reimbursement Obligations or any Obligations (whether or not due) shall remain
unpaid or any Lender shall have any Revolving Credit Commitment hereunder, the
Borrowers will not, without the prior written consent of the Majority Lenders:
9.01. Liens, Etc. Create or suffer to exist, or permit any of
their respective Subsidiaries to create or suffer to exist, any Lien upon or
with respect to any of their properties, rights or other assets, whether now
owned or hereafter acquired, or assign or otherwise transfer, or permit any of
their respective Subsidiaries to assign or otherwise transfer, any right to
receive income, other than the following (the "Permitted Liens"):
(a) Liens created pursuant to the Loan Documents;
(b) Liens existing on the Closing Date and extensions
and renewals thereof provided that such extensions and renewals do not change
the principal, interest, or other financial terms or obligations thereof, as set
forth in Part A of Schedule 9.01 hereof;
(c) Liens in connection with any taxes, assessments,
governmental charges, levies, or claims that are not yet due and payable or
which any Borrower is contesting in good faith and by appropriate proceedings
diligently conducted so long as reserves or other appropriate provisions as may
be required by GAAP have been made therefor and so long as the failure to pay
the same would not result in and could not reasonably be expected to result in a
Material Adverse Effect;
(d) Liens created by operation of Law other than
Environmental Liens, such as materialmen's liens, mechanics' liens (not to
exceed $50,000 in the aggregate) and other similar Liens, arising in the
ordinary course of business which secure amounts not overdue for a period of
more than sixty (60) days or which are being contested in good faith by
appropriate proceedings and which have been bonded or with respect to which a
stay of enforcement is in effect;
(e) deposits (including utility security deposits),
pledges or Liens (other than Liens arising under ERISA), securing (1)
obligations incurred in respect of workers' compensation, unemployment insurance
or other forms of governmental insurance or benefits, (2) the performance of
bids, tenders, leases, contracts (other than for the payment of money) and
statutory obligations, or (3) obligations on surety or appeal bonds, but only to
the extent such deposits, pledges or Liens are incurred or otherwise arise in
the ordinary course of business and secure obligations which are not past due;
(f) Liens in favor of the Note Holders and the PIK
Trustee, subject to the Intercreditor Agreement;
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(g) purchase money Liens solely on the asset being
acquired by the Borrowers, provided that each such Lien does not exceed
$3,000,000;
(h) [Intentionally Omitted];
(i) judgment Liens that do not constitute an Event of
Default;
(j) existing Liens on assets acquired after the
Closing Date;
(k) involuntary Liens in the case of the Inactive
Guarantors;
(l) precautionary UCC filings in connection with
property not constituting Collateral hereunder (e.g., leases of telecopier
machines); and
(m) an encumbrance of a landlord with respect to the
interest of the Borrowers or Guarantors as a lessee or sublessee under a Lease
but not including any liens or encumbrances arising out of any default
thereunder.
9.02. Indebtedness. Create, incur or suffer to exist, or
permit any of their respective U.S. Subsidiaries to create, incur or suffer to
exist, any Indebtedness, other than:
(a) Indebtedness created hereunder or under the Notes
or any Letter of Credit;
(b) Indebtedness existing on the date hereof, as set
forth in Schedule 9.02 hereto, or related to the Inactive Guarantors (to the
extent in existence on the date hereof) (including subsequent refinancings so
long as all such refinancings do not increase the principal amount thereof);
(c) Indebtedness in connection with Capitalized
Leases permitted by Section 9.07 of this Agreement (including subsequent
refinancings so long as all such refinancings do not increase the principal
amount thereof);
(d) Indebtedness secured by Liens or security
interests permitted by Section 9.01(f) (including subsequent refinancings so
long as all such refinancings do not increase the principal amount thereof);
(e) Indebtedness created under the PIK Indenture in
the original principal amount not to exceed $95,000,000 (including subsequent
refinancings so long as all such refinancings do not increase the original
principal amount thereof, and the indebtedness and liens created under the PIK
Indenture thereunder are subject to the Intercreditor Agreement);
(f) Indebtedness under the Note Purchase Agreement in
the original principal amount not to exceed $10,000,000 (plus all interest and
fees payable under the Note Purchase Agreement) (including subsequent
refinancings to the extent such refinancings are in an amount not more than the
greater of the then principal amount $10,000,000, and the lenders thereunder are
subject to the Intercreditor Agreement and the term thereof is no shorter than
the
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maturity date of the obligations under the Note Purchase Agreement as (and to
the extent) extended as provided in Section 9.20); and
(g) Indebtedness incurred pursuant to, and in
accordance with the requisites of, subsections 9.06(e) and (f) hereof.
9.03. Guarantees, Etc. Become liable, or permit any of their
respective Subsidiaries to become liable, under any guarantee in connection with
any Indebtedness of any other Person, other than:
(a) guaranties by endorsement of negotiable
instruments for deposit or collection in the ordinary course of business;
(b) guaranties existing on the date hereof, as set
forth in Schedule 9.03 hereto, but not any renewal or other modification
thereof;
(c) guaranties of Indebtedness permitted by Section
9.02; and
(d) guaranties of Indebtedness of non-wholly owned
Subsidiaries or joint ventures so long as such guaranties are unsecured and
expressly subordinated to the prior payment in full of the Obligations in form
and substance reasonably satisfactory to the Lenders (such subordination to be
satisfactory if such subordination has the same level of subordination as
applicable to the PIK Holders under the Intercreditor Agreement).
9.04. Merger, Consolidation, Sale of Assets, Etc.
(a) Merge or consolidate with any Person, or permit
any of their respective Subsidiaries to merge or consolidate with any Person;
provided, however, that any Borrower may merge with any other Borrower, and
Guarantors may merge with any Borrower or any Subsidiary so long as there is no
material impact on any Borrower or on the Collateral (as reasonably determined
by the Agent upon advance notice thereof); or
(b) Sell, assign, lease or otherwise transfer or
dispose of, or permit any of their respective Subsidiaries (other than Inactive
Guarantors) to sell, assign, lease, or otherwise transfer or dispose of, whether
in one transaction or in a series of related transactions, any of their
respective properties, rights or other assets, whether now owned or hereafter
acquired to any Person; provided, however, that (i) the Borrowers and their
respective Subsidiaries may sell Inventory in the ordinary course of business,
(ii) the Borrowers and their respective Subsidiaries may dispose of obsolete or
worn-out property (other than Inventory or Memorabilia) in the ordinary course
of business for fair market value, if the proceeds are used to promptly replace
such assets, (iii) so long as no Event of Default has occurred and is
continuing, the Borrowers may sell Memorabilia, upon delivery to the Agent of a
request by the Borrowers to release the Authenticity Documents relating to such
Memorabilia and certification by a Designated Financial Officer that such
Memorabilia is to be sold at a price such that the Net Proceeds are equal to not
less than eighty percent (80%) of the current Book Value of such Memorabilia and
so long as the Net Proceeds of such sale are applied to the Loans (and the
Borrowing Base is reduced on a dollar-for-dollar basis, based on Book Value
(multiplied by eighty percent (80%) or the advance
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rate of the Eligible Memorabilia then in effect), provided, however, that if (A)
after such Memorabilia is sold the Book Value (multiplied by eighty percent
(80%) (or the advance rate of the Eligible Memorabilia then in effect) is in
excess of the Memorabilia Sublimit (and there is no overadvance at such time),
then the Borrowing Base shall not be reduced as aforesaid, or, if there are no
Loans, to be used before any borrowings are made hereunder or (B) such Net
Proceeds were paid in part in cash and in part on a non-cash basis, such
non-cash portion shall only be permitted to the extent that the aggregate of
such non-cash proceeds do not exceed $500,000 (when added together with any
other non-cash proceeds under this Section 9.04(b)) at any time outstanding;
(iv) so long as no Potential Default or Event of Default has occurred and is
continuing, sales or other dispositions of loans, advances and investments
permitted by Section 9.06 (other than 9.06(d)) hereof in each case for cash at
fair market value so long as the Net Proceeds of such sale are applied to the
Loans (and the Borrowing Base is reduced on a dollar for dollar basis to the
extent any such sales include assets included in the Borrowing Base) and the
Commitment is reduced in accordance with Section 2.04(a) hereof (to the extent
Net Proceeds are paid in part in cash and in part on a non-cash basis, such
non-cash portion shall only be permitted to the extent that the aggregate of
such non-cash proceeds do not exceed (when added together with any other
non-cash proceeds under this Section 9.04(b)) $500,000; (v) so long as no
Potential Default or Event of Default has occurred and is continuing, Asset
Sales among the Borrowers so long as such sales or other transfers are made in
exchange for adequate and fair consideration under applicable law; and (vi)
Asset Sales among the Guarantors or from any Guarantor to any Borrower so long
as such sales or other transfers are made in exchange for adequate and fair
consideration under applicable law (no such sales or other transfers shall be
permitted from any Borrower to any Guarantor) and all Liens created under the
Loan Documents are perfected and continue to be perfected (to the extent Net
Proceeds are paid in part in cash and in part on a non-cash basis, such non-cash
portion shall only be permitted to the extent that the aggregate of such
non-cash proceeds do not exceed (when added together with any other non-cash
proceeds under this Section 9.04(b)) $500,000; and provided, further, that so
long as no Potential Default or Event of Default has occurred and is continuing,
Asset Sales of Assets not otherwise described in this Section 9.04(b) may be
sold or otherwise disposed of so long as the proceeds of such sales are applied
as a Commitment reduction in accordance with Section 2.04(a) hereof and a
mandatory prepayment under Section 2.04(b)(ii) (the foregoing in no way limiting
the grant by the Borrowers and the Guarantors of a first priority perfected
security interest on all Collateral which attaches to proceeds thereof) (to the
extent Net Proceeds are paid in part in cash and in part on a non-cash basis,
such non-cash portion shall only be permitted to the extent that the aggregate
of such non-cash proceeds do not exceed (when added together with any other
non-cash proceeds under this Section 9.04(b)) $500,000.
9.05. Change in Nature of Business. Make, or permit any of
their respective Subsidiaries (other than Inactive Guarantors) to make, any
change in the nature of their business as carried on at the date hereof.
9.06. Loans, Advances and Investments, Etc. Make, or permit
any of their respective Subsidiaries to make, any loan or advance to any Person
or purchase or otherwise acquire, or permit any of their respective Subsidiaries
to purchase or otherwise acquire, any capital stock, properties, assets or
obligations of, or any interest in, any Person, other than:
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(a) Permitted Investments;
(b) receivables for goods sold owing to any of the
Borrowers or any of their respective Subsidiaries if created or acquired in the
ordinary course of business and payable or dischargeable in accordance with the
customary trade terms of such Borrower or its respective Subsidiaries, as the
case may be (but not covered by subsections (e) or (f) of this Section 9.06);
(c) loans and advances to employees in the ordinary
course of business in an aggregate principal amount not to exceed $150,000
(inclusive of relocation expenses) at any time outstanding;
(d) investments existing on the date hereof, as set
forth in Schedule 9.06 hereto;
(e) loans and advances made (x) from any Borrower to
any other Borrower in an unlimited amount or (y) from any Borrower to any Active
Guarantors or any Foreign Entities in an aggregate amount not to exceed
$4,000,000 (minus all amounts set forth in subsection 9.06(f) below) so long as
(i) the Agent has been granted a first priority lien in the ownership interest
held by any such Borrower or Active Guarantor (limited in the case of the stock
of a Foreign Entity to sixty six and two thirds percent (66.67%) of the voting
shares and other voting interests) in the jurisdiction governing perfection and
such lien is perfected (and evidence of same has been delivered to the Agent in
form and substance reasonably satisfactory to it), (if the interest pledged is
of an entity formed outside of the United States the Agent shall determine
whether such perfection has occurred based on advice of counsel), and (ii) all
such loans and advances are evidenced by a note or other ownership interest,
pledged (and delivered) to the Agent hereunder and subordinated to the prior
payment in full of the Loans; or
(f) Loans and advances made by the Borrower or any
Active Guarantor to (or investments made with respect to) any joint venture
created after the date hereof in which a Borrower or Active Guarantor has an
interest in an aggregate amount not to exceed $4,000,000 (minus all amounts set
forth in subsection 9.06(e) above); provided, however, that no such amount shall
be permitted to be loaned or advanced or invested by Borrowers or Active
Guarantors in such joint ventures unless prior to such loan or advance, such
loans and advances are evidenced by a note or other ownership interest, pledged
and delivered to the Agent hereunder and subordinated to the prior payment in
full of the Loans.
9.07. Lease Obligations. Create, incur or suffer to exist, or
permit any of their respective Subsidiaries to create, incur or suffer to exist,
any obligations as lessee for the payment of rent for any real or personal
property in connection with any sale and leaseback transaction without the prior
written consent of the Agent.
9.08. Dividends, Prepayments, Etc. Declare or pay any
dividends, purchase or otherwise acquire, or purchase or otherwise acquire, for
value any of their respective capital stock now or hereafter outstanding, return
any capital to their respective stockholders as such, or make any other payment
or distribution of assets to their respective stockholders as such, or permit
any of their respective Subsidiaries to do any of the foregoing or to purchase
or otherwise
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acquire for value any stock of the Borrowers or make any payment or prepayment
of principal or, premium, if any, or interest on, or redeem, defease or
otherwise retire, any other Indebtedness of the Borrowers other than (i)
dividends or other distributions by any Guarantor to any Borrower or by any
Borrower to any other Borrower, (ii) so long as no Potential Default or Event of
Default has occurred or is continuing, the Borrowers may make the Permitted BH
Note Payments and the Permitted PIK Note Payments, (iii) dividends or
distributions payable in capital stock or other equity interests, warrants to
purchase capital stock or other equity interests, or split-ups or
reclassifications of its capital stock or other equity interests into additional
shares of its capital stock or other equity interests, (iv) prepayments of
Indebtedness not in excess of $500,000 in the aggregate, (v) payments to the
Note Holders but only at the times and in the amounts permitted to be paid under
the Intercreditor Agreement, and (vi) payments with respect to Indebtedness
permitted under Section 9.02 hereof.
9.09. Transactions with Affiliates. Except as set forth in
Schedule 9.09 annexed hereto, (i) enter into or be a party to, or permit any of
their respective Subsidiaries to enter into or be a party to, any transaction
with any Affiliate of the Borrowers except as otherwise provided herein or in
the ordinary course of business in a manner and to an extent consistent with
past practice and necessary or desirable for the prudent operation of its
business for fair consideration and on terms no less favorable to the Borrowers
or their Subsidiaries as are available from unaffiliated third parties, or (ii)
subject to Section 9.06 hereof, engage in any loan or capital investment (or any
transaction which is the substantive equivalent thereof) with Affiliates of any
of the Borrowers.
9.10. Sale Policies. Engage in policies or procedures with
respect to the selling price of Inventory, which policies and procedures are
inconsistent in any material respect with the past practices of the Borrowers or
good retail practice absent the prior written consent of the Agent.
9.11. Environmental. Permit the use, handling, generation,
storage, treatment, Release or disposal of any Hazardous Material at property
owned or leased by any of the Borrowers except in compliance with Environmental
Laws and so long as such use, handling, generation, storage, treatment, Release
or disposal of Hazardous Materials would not result in Environmental Liabilities
and Costs in excess of $500,000 in the aggregate together with such other
Environmental Liabilities and Costs.
9.12. ERISA.
(a) Engage in any prohibited transaction described in
Section 406 of ERISA or 4975 of the Code for which a statutory or class
exemption is not available or a private exemption has not previously been
obtained from the Department of Labor;
(b) permit, or permit any ERISA Affiliate to permit,
any Lien from arising under ERISA or Section 412(n) of the Code;
(c) amend or permit any ERISA Affiliate to amend any
Plan in a manner that would require security under Section 307 of ERISA; or
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(d) request or permit any ERISA Affiliate to request
a waiver of the minimum funding requirements under Section 412 of the Code in
respect of any Plan.
9.13. Subsidiaries. Create or acquire any Subsidiaries not
existing on the Closing Date; provided, however, that the Borrowers may create
or acquire (i) one (1) or more U.S. Subsidiaries after the Closing Date with the
consent of the Agent, provided that each such U.S. Subsidiary promptly, and in
no event later than ten (10) Business Days after creation or acquisition, as the
case may be, becomes a Guarantor and has entered into a Guarantor Security
Agreement including, without limitation, execution of all other necessary
documentation related thereto, pursuant to which all security interests granted
thereunder may be perfected by the Agent, or (ii) one or more Foreign Entities
so long as no assets currently owned by a U.S. Subsidiary (other than
Memorabilia transferred or moved in accordance with Sections 8.13 and 8.14
hereof) are transferred to any Foreign Entity and substantially all of such
Foreign Entity's assets are located outside of the United States.
9.14. Capital Expenditures. Make or be committed to make, or
permit any of its Subsidiaries to make or be committed to make, any expenditure
(by purchase or capitalized lease) for fixed or capital assets other than
expenditures (including obligations under Capitalized Leases) which would cause
the aggregate amount of all such expenditures to exceed $6,000,000 per annum (on
a cumulative basis such that amounts not used in any one (1) year may be used in
subsequent years); provided, however, that amounts permitted to be expended
pursuant to Sections 8.07 and 9.06 shall not be deemed to be capital
expenditures hereunder.
9.15. Federal Reserve Regulations. Permit any Loan or the
proceeds of any Loan under this Agreement to be used for any purpose which
violates or is inconsistent with the provisions of Regulation T, U or X of the
Board of Governors of the Federal Reserve System 8.11.
9.16. Limitation on Plan of Reorganization Payments. Permit
payments to fund the Plan of Reorganization or pay any creditor on account of a
prepetition claim on the Closing Date in excess of $66,000,000.
9.17. Inactive Guarantors. Permit any Inactive Guarantor to
engage in business or other activity of any kind, other than that which is
directly related to the maintenance of its organizational existence.
9.18. Negative Pledge. Permit the mortgage, encumbrance,
pledge or hypothecation by any Borrower or any Guarantor (other than pursuant to
the Loan Documents) of any (i) Leases or other real property interests, (ii)
shares of or interest in any Guarantors or any Foreign Entity not pledged to the
Agent hereunder, (iii) any interest of any Borrower or any Guarantor in any
foreign or domestic joint venture, (iv) any assets in any Foreign Entity or any
joint venture; or (v) any interest in TSP; provided, however, that the interests
or assets described in (iii) and (iv) may be subject to a pledge in favor of a
third party if such joint venture or Foreign Entity is not, and will not be, the
recipient of any loans or advances under subsections 9.06(e) or 9.06(f) hereof.
If, notwithstanding the previous sentence, the Borrower or any of its
Subsidiaries grants a security interest in the capital stock of Hospitality, or
Hospitality grants a security
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interest in the Membership Interest or any other interest in TSP, in violation
of the same, Planet Hollywood shall automatically and without the requirement of
notice to or action by any Person be deemed to have granted to the Agent a prior
and superior security interest therein and shall take all action reasonably
requested by the Agent to effect the same.
9.19. Foreign Entities. No Foreign Entity, now existing or
hereafter formed, shall own (by acquisition or transfer from any Borrower or
Guarantor) or otherwise take possession of any assets that are located within
the United States of America (other than assets having an aggregate value of not
more than $50,000 at any time); provided, however, that, notwithstanding
anything in this Section 9.19, the Borrowers and the Active Guarantors shall be
entitled to transfer or move Inventory and Memorabilia in accordance with the
terms of Sections 8.13 and 8.14 hereof.
9.20. Note Maturity Date. At least one (1) month prior to the
Maturity Date, the maturity date with respect to the BH Notes shall not be
earlier than six months after the Maturity Date unless the Agent agrees to a
shorter extension. The Borrowers hereby agree that the Agent may pay any fees
(and charge the loan account therefor) required under the Note Purchase
Agreement to be paid by the Borrowers and if it determines to do so, cause the
Borrower to pay, or pay on the Borrower's behalf as aforesaid, fees sufficient
for a five month, 28 day extension under such Note Purchase Agreement.
ARTICLE X
DEFAULTS
--------
10.01. Events of Default. An Event of Default shall mean the
occurrence or existence of one or more of the following events or conditions
(whatever the reason for such Event of Default and whether voluntary,
involuntary or effected by operation of law):
(a) Any Borrower or any Guarantor shall (i) fail to
make any payment of principal under this Agreement on any Loan or any
Reimbursement Obligation when due, or (ii) except as set forth in clause (iii),
fail to pay when due any other amount payable under this Agreement or any other
Related Document (including but not limited to the making of deposits in the
Depository Accounts, the Blocked Account, the Cash Concentration Account or the
Letter of Credit Cash Collateral Account) or (iii) fail to pay fees, expenses
and any other de minimus amounts required hereunder and such failure shall have
continued unremedied for a period of two (2) days;
(b) Any representation or warranty made by any
Borrower or any Guarantor under this Agreement or any other Related Document or
any statement made by any Borrower in any financial statement, certificate,
report or document furnished to the Agent or the Lenders pursuant to or in
connection with this Agreement or any other Related Document (other than those
related to an Inactive Guarantor except with respect to its inactivity), shall
prove to have been false or misleading in any material respect as of the time
when made (including by omission of material information necessary to make such
representation, warranty or statement, in light of the circumstances under which
it was made, not misleading); or
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(c) Any Borrower defaults in the performance or
observance of any covenant contained in Section 5.03 or Article VIII hereof
(subject to the grace periods applicable under this Agreement to the covenants
contained in Article VIII, including such grace periods contained in subsection
10.01(d) hereof) or Article IX hereof; or
(d) Any Borrower defaults in the performance or
observance of (i) the covenants contained in Section 8.01 (other than paragraphs
(e) and (f) thereof) and such default shall have continued unremedied for a
period of five (5) days, (ii) the covenants contained in paragraphs (e) and (f)
of Section 8.01 and such default shall have continued unremedied for a period of
three (3) days, and (iii) any other covenant, agreement or duty under this
Agreement or any other Related Document (to the extent not otherwise set forth
in this Section 10.01) and such default shall have continued unremedied for a
period of thirty (30) days; or
(e) There shall be an "event of default" under the
Note Purchase Agreement or the PIK Indenture respectively (after the expiration
of applicable grace periods); or
(f) Any Borrower or any of its Subsidiaries (other
than Inactive Guarantors so long as no Borrower, Active Guarantor or Foreign
Entity is or may be liable thereon) shall have entered into any consent or
settlement decree or agreement or similar arrangement with a Governmental
Authority or any judgment, order, decree or similar action shall have been
entered against any such Person, in each case based on or arising from the
violation of or pursuant to any Environmental Law, or the generation, storage,
transportation, treatment, disposal or Release of any Hazardous Material and, in
connection with any of the foregoing, any such Person shall incur Environmental
Liabilities and Costs which are unstayed, due and owing in an amount in excess
of $500,000 in the aggregate together with other such Environmental Liabilities
and Costs; or
(g) Any material provision of any Loan Document shall
at any time for any reason be declared to be null and void, or the validity or
enforceability thereof shall be contested by any Borrower or any Guarantor, or a
proceeding shall be commenced by any Borrower or any Guarantor, or by any
Governmental Authority or other regulatory body having jurisdiction over any
Borrower, seeking to establish the invalidity or unenforceability thereof, or
any Borrower or any Guarantor shall deny in writing that any Borrower or any
Guarantor has any liability or obligation purported to be created under any Loan
Document; or
(h) Any Borrower or any of its ERISA Affiliates shall
have made a complete or partial withdrawal from a Multiemployer Plan, and, as a
result of such complete or partial withdrawal, such Borrower or such ERISA
Affiliate incurs a withdrawal liability in an annual amount exceeding $200,000;
or a Multiemployer Plan enters reorganization status under Section 4241 of
ERISA, and, as a result thereof, such Borrower's or such ERISA Affiliate's
annual contribution requirement with respect to such Multiemployer Plan
increases in an annual amount exceeding $500,000; or
(i) (i) Any Plan shall fail to satisfy the minimum
funding standard required for any plan year or part thereof or a waiver of such
standard or extension of any amortization period is sought or granted under
Section 412 of the Code, any Plan shall have had
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or is likely to have a trustee appointed to administer such Plan, any Plan is,
shall have been or is likely to be terminated or to be the subject of
termination proceedings under ERISA, any Plan shall have an Unfunded Current
Liability, a contribution required to be made to a Plan has not been timely
made, any Borrower or any ERISA Affiliate has incurred or is likely to incur a
liability to or on account of a Plan under Section 409, 502(i), 502(1), 515,
4062, 4063, 4064, 4069, 4201, 4204 or 4212 of ERISA or Section 401(a)(29), 4971
or 4975 of the Code, or such Borrower or any U.S. Subsidiary has incurred or is
likely to incur liabilities pursuant to one or more employee welfare benefit
plans (as defined in Section 3(1) of ERISA) that provide benefits to retired
employees or other former employees (other than as required by Section 601 of
ERISA); and (ii) there shall result from any such event or events the imposition
of a Lien or the granting of a security interest, or there shall result from any
such event or events a liability or a material risk of incurring a liability
which would result in a Material Adverse Effect; or
(j) Xxxxxx Xxxx shall cease to be Chairman of the
Board of Directors or Chief Executive Officer of Planet Hollywood or (ii) breach
or be in default of any obligations under the Agreement Regarding Leases after
the expiration of any applicable grace periods therein if any; or
(k) Any Borrower shall use any Loan, advance,
acceptance or Letter of Credit issued under this Agreement in a manner
inconsistent with Sections 2.09 and 7.17 hereto; or
(l) Except as set forth in subsection 10.01(e)
hereof, any Borrower or any U.S. Subsidiary shall fail to pay any principal or
interest on any of its Indebtedness (excluding Indebtedness evidenced by the
Notes) in excess of $200,000 or any interest or premium thereon, when due
(whether by scheduled maturity, required prepayment, acceleration, demand or
otherwise) and such failure shall continue after the applicable grace period, if
any, specified in the agreement or instrument relating to such Indebtedness, or
any other default under any agreement or instrument relating to any such
Indebtedness, or any other event, shall occur and shall continue after the
applicable grace period, if any, specified in such agreement or instrument, if
the effect of such default or event is to accelerate, or to permit the
acceleration of, the maturity of such Indebtedness; or any such Indebtedness in
excess of such amount shall be declared to be due and payable, or required to be
prepaid (other than by a regularly scheduled required prepayment), prior to the
stated maturity thereof; or
(m) Any Borrower or any U.S. Subsidiary (other than
Inactive Guarantors) (i) shall institute any proceeding or voluntary case
seeking to adjudicate it a bankrupt or insolvent, or seeking dissolution,
liquidation, winding up, reorganization, arrangement, adjustment, protection,
relief or composition of it or its debts under any law relating to bankruptcy,
insolvency, reorganization or relief of debtors, or seeking the entry of an
order for relief or the appointment of a receiver, trustee, custodian or other
similar official for any Borrower or any U.S. Subsidiary or for any substantial
part of its property, (ii) shall be generally not paying its debts as such debts
become due, or shall admit in writing its inability to pay its debts generally,
(iii) shall make a general assignment for the benefit of creditors, or (iv)
shall take any action to authorize or effect any of the actions set forth above
in this subsection (m); or
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(n) Any proceeding shall be instituted against any
Borrower or any U.S. Subsidiary (other than Inactive Guarantors) seeking to
adjudicate it a bankrupt or insolvent, or seeking dissolution, liquidation,
winding up, reorganization, arrangement, adjustment, protection, relief of
debtors, or seeking the entry of an order for relief or the appointment of a
receiver, trustee, custodian or other similar official for any Borrower or any
U.S. Subsidiary or for any substantial part of its property, and either such
proceeding shall remain undismissed or unstayed for a period of forty-five (45)
days or any of the actions sought in such proceeding (including, without
limitation, the entry of an order for relief against it or the appointment of a
receiver, trustee, custodian or other similar official for it or for any
substantial part of its property) shall occur; or
(o) The Security Agreement or any other Security
Document, after delivery thereof pursuant hereto, shall for any reason fail or
cease to create a valid and perfected and, except to the extent permitted by the
terms hereof or thereof, first priority Lien on or security interest in any
Collateral purported to be covered thereby; or
(p) One or more judgments or orders (other than a
judgment described in subsections 10.01(f) or (g) hereof) for the payment of
money exceeding any applicable insurance or bond coverage by more than
$1,000,000 in the aggregate shall be rendered against any Borrower or any U.S.
Subsidiary (other than Inactive Guarantors, so long as no Borrower, Active
Guarantor or Foreign Entity is or may be liable thereon) and either (i)
enforcement proceedings shall have been commenced by any creditor upon any such
judgment or order, or (ii) there shall be any period of twenty (20) consecutive
days during which a stay of enforcement of any such judgment or order, by reason
of a pending appeal or otherwise, shall not be in effect.
10.02. Consequences of an Event of Default. If an Event of
Default shall occur and be continuing or shall exist the Agent may, and upon the
direction of the Majority Lenders shall, by notice to Planet Hollywood:
(a) declare the Revolving Credit Commitment of each
Lender and the Current Commitment terminated, whereupon the Revolving Credit
Commitment of each Lender and the Current Commitment will terminate immediately,
without presentment, demand, protest or further notice of any kind, all of which
are hereby expressly waived, and an action therefor shall immediately accrue;
and/or
(b) declare the unpaid principal amount of the Notes,
interest accrued thereon, the total amount of the Letter of Credit Exposure that
is not cash collateralized in accordance with this Agreement, any fees due
hereunder and all other amounts owing by the Borrowers hereunder or under the
Notes to be immediately due and payable, without presentment, demand, protest or
further notice of any kind, all of which are hereby expressly waived, and an
action therefor shall immediately accrue; and/or
(c) give notice to the Borrowers of the occurrence
and continuance of an Event of Default; and/or
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(d) at any time when there are no Loans outstanding,
maintain cash collateral (to the extent the Borrowers have or receive cash)
equal to one hundred and five percent (105%) of all outstanding Letters of
Credit; and/or
(e) apply all funds deposited in the Letter of Credit
Cash Collateral Account to the payment, in whole or in part, of the Obligations;
and/or
(f) set-off amounts in the Letter of Credit Cash
Collateral Account or any other accounts under the dominion and control of the
Agent and apply such amounts to the Obligations of the Borrowers hereunder and
under the Related Documents;
provided, however, that upon the occurrence of any Event of Default described in
subsections (n) or (o) of Section 10.01, the Loans and all Reimbursement
Obligations, all interest thereon, all fees hereunder and all other amounts
shall become and be forthwith due and payable, without presentment, demand,
protest or further notice of any kind, all of which are expressly waived by the
Borrowers.
10.03. Deposit for Letters of Credit. Upon the occurrence of
an Event of Default, the Letter of Credit Issuer may make payment of all or any
part of the Stated Amount of any Letter of Credit to the beneficiary thereof, or
to the Letter of Credit Cash Collateral Account, in which event such payment
shall be treated in all respects as a drawing under the Letter of Credit in full
compliance therewith (notwithstanding that the beneficiary shall have failed to
present all or any of the documents or satisfied all or any of the requirements
for a drawing thereunder) and shall result in an Unreimbursed Draw. In addition,
upon demand by the Letter of Credit Issuer after the occurrence of any Event of
Default, the Borrowers shall deposit with the Agent for the benefit of the
Letter of Credit Issuer with respect to each Letter of Credit then outstanding
cash in an amount equal to the greatest amount for which such Letter of Credit
may be drawn. Such deposits shall be held by the Agent for the benefit of the
Letter of Credit Issuer in the Letter of Credit Cash Collateral Account as
security for, and to provide for the payment of, the Letter of Credit Exposure.
10.04. Certain Remedies. If an Event of Default occurs, each
of the Agent and the Lenders may exercise all rights and remedies which it may
have hereunder or under any other Related Document or at law or in equity or
otherwise. All such remedies shall be cumulative and not exclusive.
ARTICLE XI
MISCELLANEOUS
-------------
11.01. Holidays. Except as otherwise provided herein, whenever
any payment or action to be made or taken hereunder or under the Notes shall be
stated to be due on a day which is not a Business Day, such payment or action
shall be made or taken on the next following Business Day and such extension of
time shall be included in computing interest or fees, if any, in connection with
such payment or action.
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11.02. Records. The unpaid principal amount of the Notes, the
unpaid interest accrued thereon, the interest rate or rates applicable to such
unpaid principal amount, the duration of such applicability, the Current
Commitment, the Stated Amount of each Letter of Credit, the principal amount of
all Reimbursement Obligations, the Letter of Credit Exposure, and the accrued
and unpaid Agent's fees, Unused Line Fee and Letter of Credit Fees shall at all
times be ascertained from the records of the Agent, which shall be conclusive
and binding absent manifest error.
11.03. Amendments and Waivers. No amendment or modification of
any provision of this Agreement or of any of the Notes or of any other Related
Document shall be effective without the written agreement of the Majority
Lenders and the Borrowers and no termination or waiver of any provision of this
Agreement or of any of the Notes, or consent to any departure by the Borrowers
therefrom, shall in any event be effective without the written concurrence of
the Majority Lenders, which Majority Lenders shall have the right to grant or
withhold at their sole discretion; except that any amendment, modification, or
waiver (i) of any provision of Article II or III which amendment, modification
or waiver increases the Revolving Credit Commitment of any Lender, reduces the
principal of, or interest on, the Loans or the Reimbursement Obligations payable
to any Lender, reduces the amount of any fee payable for the account of any
Lender, or postpones or extends any date fixed for any payment of principal of,
or interest or fees on, the Loans or Letter of Credit Exposure payable to any
Lender, (ii) that increases the aggregate amount of the Revolving Credit
Commitments of the Lenders, (iii) of the definitions of "Maturity Date",
"Termination Date", "Majority Lenders", "Eligible Memorabilia", or "Pro Rata
Shares", (iv) of the definitions of "Eligible Inventory" or "Borrowing Base" if
the effect of such amendment, modification or waiver is to increase the
Availability of the Borrowers, or (v) the provisions contained in this Section
11.03, shall be effective only if evidenced by a writing signed by or on behalf
of (A) any Lender affected thereby in the case of the amendments, modifications
or waivers described in clause (i) above, or (B) all Lenders in the case of the
amendments, modifications or waivers described in clauses (ii) through (vi)
above. No amendment, modification, termination, or waiver of any provision of
Article XII or any other provision referring to the Agent shall be effective
without the written concurrence of the Agent. Any waiver or consent shall be
effective only in the specific instance and for the specific purpose for which
it was given. No notice to or demand on the Borrowers in any case shall entitle
the Borrowers to any other or further notice or demand in similar or other
circumstances. Any amendment, modification, waiver or consent effected in
accordance with this Section 11.03 shall be binding on each Lender, each future
Lender, and, if signed by the Borrowers, on the Borrowers.
11.04. No Implied Waiver; Cumulative Remedies. No course of
dealing and no delay or failure of the Lenders or the Agent in exercising any
right, power or privilege under this Agreement, the Notes or any other Related
Document shall affect any other or future exercise thereof or exercise of any
other right, power or privilege; nor shall any single or partial exercise of any
such right, power or privilege or any abandonment or discontinuance of steps to
enforce such a right, power or privilege preclude any further exercise thereof
or of any other right, power or privilege. The rights and remedies of the
Lenders or the Agent under this Agreement, the Notes and the other Related
Documents are cumulative and not exclusive of any rights or remedies which the
Lenders or the Agent have thereunder or at law or in equity or otherwise.
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The Lenders or the Agent may exercise their rights and remedies against the
Borrowers and the Collateral as the Lenders and the Agent may elect, and
regardless of the existence or adequacy of any other right or remedy.
11.05. Notices.
(a) All notices, requests, demands, directions and
other communications (collectively, the "Notices") under the provisions of this
Agreement or the Notes shall be in writing and shall be mailed (by certified
mail, postage prepaid and return receipt requested), telecopied, or delivered by
hand or overnight courier (Federal Express, United Parcel Service, Airborne
Express, etc.) and shall be effective (i) if mailed, three (3) days after being
deposited in the mails, (ii) if telecopied, when sent, confirmation received,
and (iii) if delivered by hand or overnight courier, upon delivery. All notices
shall be sent to the applicable party at the address stated on the signature
page hereof together with, in the case of a letter of credit request and Letter
of Credit Application sent pursuant to subsection 3.01(a), a copy to the Agent
at the address for the Agent provided on the signature page hereof, or in
accordance with the last unrevoked written direction from such party to the
other parties hereto.
(b) The Lenders and the Agent may rely, and shall be
fully protected in relying, on any notice purportedly made by or on behalf of
the Borrowers and the Lenders and the Agent shall have no duty to verify the
identity or authority of any Person giving such notice. The preceding sentence
shall apply to all notices whether or not made in a manner authorized or
required by this Agreement or any other Related Document.
11.06. Expenses; Taxes; Attorneys' Fees; Indemnification. The
Borrowers jointly and severally agree to pay or cause to be paid, on demand, and
to save the Agent and the Lenders harmless against liability for the payment of,
all reasonable out-of-pocket expenses, regardless of whether the transactions
contemplated hereby are consummated, including but not limited to reasonable
fees and expenses of counsel for the Agent and the Lenders, accounting, due
diligence, periodic field audits, appraisals, investigations, monitoring of
assets, syndication, miscellaneous disbursements, examination, travel, lodging
and meals, incurred by the Agent (and, in the case of clauses (c) through (m)
below, the Lenders) from time to time arising from or relating to: (a) the
negotiation, preparation, execution, delivery, performance and administration of
this Agreement, the Intercreditor Agreement, the Inter-Lender Agreement and the
Related Documents, (b) any requested amendments, waivers or consents to this
Agreement, the Intercreditor Agreement, the Inter-Lender Agreement or the
Related Documents whether or not such documents become effective or are given,
(c) the preservation and protection of any of the Agent's and the Lenders'
rights under this Agreement, the Intercreditor Agreement, the Inter-Lender
Agreement or the Related Documents, (d) the defense of any claim or action
asserted or brought against the Agent or the Lenders by any Person that arises
from or relates to this Agreement, the Intercreditor Agreement, the Inter-Lender
Agreement, any Related Document, the Agent's or the Lenders' claims against any
Borrower, or any and all matters in connection therewith, (e) the commencement
or defense of, or intervention in, any court proceeding arising from or related
to this Agreement, the Intercreditor Agreement, the Inter-Lender Agreement or
any Related Document, (f) the filing of any petition, complaint, answer, motion
or other pleading by the Agent or the Lenders, or the taking of any action in
respect of the Collateral or other
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security, in connection with this Agreement, the Intercreditor Agreement, the
Inter-Lender Agreement or any Related Document, (g) the protection, collection,
lease, sale, taking possession of or liquidation of, any Collateral or other
security in connection with this Agreement, the Intercreditor Agreement, the
Inter-Lender Agreement or any Related Document, (h) any attempt to enforce any
Lien in any Collateral or other security in connection with this Agreement, the
Intercreditor Agreement, the Inter-Lender Agreement or any Related Document, (i)
any attempt to collect from any Borrower, (j) the receipt of any advice with
respect to any of the foregoing; provided, however, that this clause (j) shall
apply to all Lenders only with respect to the matters described in clauses (c)
through (i) and clauses (k) through (m) of this Section 11.06, (k) all
Environmental Liabilities and Costs arising from or in connection with the past,
present or future operations of any Borrower or any of its Subsidiaries
involving any damage to real or personal property or natural resources or harm
or injury alleged to have resulted from any Release of Hazardous Materials on,
upon or into such property, (l) any costs or liabilities incurred in connection
with the investigation, removal, cleanup and/or remediation of any Hazardous
Materials present or arising out of the operations of any facility of any
Borrower or any Subsidiary, or (m) any costs or liabilities incurred in
connection with any Environmental Lien. Notwithstanding the foregoing, the
Borrowers jointly and severally agree to cause to be paid the legal fees and
expenses of WLR in connection with the negotiation, preparation, execution,
delivery and enforcement of the Inter-Lender Agreement (which has included a
review of the Loan Documents and comments thereon as well as other work related
to the court order specified in subsection 6.01(p) hereof) promptly following
the receipt of a reasonably detailed invoice. Without limitation of the
foregoing or any other provision of any Related Document: (x) the Borrowers
agree to pay jointly and severally all stamp, document, transfer, recording or
filing taxes or fees (including, without limitation, mortgage recording taxes)
and similar impositions now or hereafter determined by the Agent or any of the
Lenders to be payable in connection with this Agreement or any other Related
Document, and the Borrowers agree to save the Agent and the Lenders harmless
from and against any and all present or future claims, liabilities or losses
with respect to or resulting from any omission to pay or delay in paying any
such taxes, fees or impositions, and (y) if the Borrowers fail to perform any
covenant or agreement contained herein or in any other Related Document, upon an
Event of Default, the Agent may itself perform or cause performance of such
covenant or agreement, and the expenses of the Agent incurred in connection
therewith shall be reimbursed on demand by the Borrowers; provided, however, if
the Agent has notice of a failure to pay insurance premiums Agent may make such
payment and be reimbursed hereunder whether or not an Event of Default has
occurred. The Borrowers jointly and severally agree to indemnify and defend the
Agent and the Lenders and their directors, officers, agents, employees and
affiliates (collectively, the "Indemnified Parties") from, and hold each of them
harmless against, any and all losses, liabilities, claims, damages, costs or
expenses of any nature whatsoever (including reasonable attorneys' fees and
amounts paid in settlement) incurred by, imposed upon, or asserted against any
of them arising out of or by reason of any investigation, litigation or other
proceeding or claim brought or threatened relating to, or otherwise arising out
of or relating to, the execution of this Agreement or any other Related
Document, the transactions contemplated hereby or thereby or any Loan or
proposed Loan or Letter of Credit or proposed Letter of Credit hereunder
(including, but without limitation, any use made or proposed to be made by the
Borrowers of the proceeds of any thereof, or the delivery or use or transfer of
or the payment or failure to pay under any Loan or Letter of Credit) but
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excluding any such losses, liabilities, claims, damages, costs or expenses to
the extent finally judicially determined to have resulted from the gross
negligence or willful misconduct of the Indemnified Party. So long as no Event
of Default shall be in existence, the Agent agrees to advise the Borrowers of
its intention to retain third parties (other than legal counsel) at any time
after the Closing Date of the Facility and to consult with the Borrowers
regarding same.
11.07. Application. Except to the extent, if any, expressly
set forth in this Agreement, the Intercreditor Agreement, the Inter-Lender
Agreement, or in the Related Documents, the Agent and the Lenders shall have the
right to apply any payment received or applied by it in connection with the
Obligations to such of the Obligations then due and payable as it may elect.
11.08. Severability. The provisions of this Agreement are
intended to be severable. If any provision of this Agreement shall be held
invalid or unenforceable in whole or in part in any jurisdiction such provision
shall, as to such jurisdiction, be ineffective to the extent of such invalidity
or unenforceability without in any manner affecting the validity or
enforceability thereof in any other jurisdiction or the remaining provisions
hereof in any jurisdiction.
11.09. Governing Law. This Agreement and the Notes shall be
deemed to be contracts under the laws of the State of New York, without regard
to choice of law principles, and for all purposes shall be governed by and
construed and enforced in accordance with the laws of said State.
11.10. Prior Understandings. This Agreement supersedes all
prior understandings and agreements, whether written or oral, among the parties
hereto relating to the transactions provided for herein.
11.11. Duration; Survival. All representations and warranties
of the Borrowers contained herein or made in connection herewith shall survive
the making of the Loans and the issuance of any Letter of Credit and shall not
be waived by the execution and delivery of this Agreement, the Notes or any
other Related Document, any investigation by or knowledge of the Agent or the
Lenders, the making of any Loan or the issuance of any Letter of Credit
hereunder, or any other event whatsoever. All covenants and agreements of the
Borrowers contained herein shall continue in full force and effect from and
after the date hereof so long as the Borrowers may borrow hereunder and until
the Obligations have been paid in full and no Letters of Credit remain
outstanding. Without limitation, it is understood that all obligations of the
Borrowers to make payments to or indemnify the Agent and the Lenders (including,
without limitation, obligations arising under Section 11.06 hereof) shall
survive the payment in full of the Notes and all Reimbursement Obligations and
of all other obligations of the Borrowers thereunder and hereunder, termination
of this Agreement and all other events whatsoever and whether or not any Loans
are made or Letters of Credit issued hereunder.
11.12. Counterparts. This Agreement may be executed in any
number of counterparts and by the different parties hereto on separate
counterparts each of which, when so
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executed, shall be deemed an original, but all such counterparts shall
constitute but one and the same instrument.
11.13. Assignments; Participations.
(a) Each Lender may with the written consent of the
Agent and Planet Hollywood, which such consents shall not be unreasonably
delayed or withheld, assign to one or more commercial banks or other financial
institutions a portion of its rights and obligations under this agreement
(including, without limitation, a portion of its Revolving Credit Commitment,
the Loans owing to it and its rights and obligations as a Lender with respect to
Letters of Credit) and the other Related Documents; provided, however, that no
consent of the Agent or Planet Hollywood is required for a transfer by a Lender
to another Lender (including a transfer by CIT to WLR pursuant to the
Inter-Lender Agreement) or a transfer by a Lender to an Affiliate of a Lender;
and provided, further, that (i) each such assignment shall be in a principal
amount of not less than $2,500,000 and in multiples of $1,000,000 in excess
thereof (or the remainder of such Lender's Revolving Credit Commitment), (ii)
the parties to each such assignment shall execute and deliver to the Agent, for
its acceptance and recording in the Register (as hereinafter defined), an
Assignment and Acceptance. Upon such execution, delivery, acceptance and
recording, from and after the effective date specified in each Assignment and
Acceptance, (A) the assignee thereunder, shall be a party hereto and to the
other Related Documents and, to the extent that rights and obligations hereunder
have been assigned to it pursuant to such Assignment and Acceptance, have the
rights and obligations (including, without limitation, the obligation to
participate in Letters of Credit) of a Lender hereunder and thereunder and (B)
the assigning Lender shall, to the extent that rights and obligations hereunder
have been assigned by it pursuant to such Assignment and Acceptance, relinquish
its rights and be released from its obligations under this Agreement. In the
event that WLR at any time purchases CIT's interest in the Obligations, all
indemnity obligations of the Borrowers and Guarantors contained in any Loan
Document shall survive such purchase by WLR and continue to run in favor of CIT
as if it were a Lender hereunder.
(b) By executing and delivering an Assignment and
Acceptance, the assignor and the assignee thereunder confirm to and agree with
each other and the other parties hereto as follows: (i) other than as provided
in such Assignment and Acceptance, the assigning Lender makes no representation
or warranty and assumes no responsibility with respect to any statements,
warranties or representations made in or in connection with this Agreement or
any other Related Document or the execution, legality, validity, enforceability,
genuineness, sufficiency or value of this Agreement or any other Related
Document furnished pursuant hereto; (ii) the assigning Lender makes no
representation or warranty and assumes no responsibility with respect to the
financial condition of any of the Borrowers or any of their respective
Subsidiaries or the performance or observance by the Borrowers of any of their
respective obligations under this Agreement, the Intercreditor Agreement, the
Inter-Lender Agreement, or any other Related Document furnished pursuant hereto;
(iii) such assignee confirms that it has received a copy of this Agreement, the
Intercreditor Agreement, the Inter-Lender Agreement, and the other Related
Documents, together with such other documents and information it has deemed
appropriate to make its own credit analysis and decision to enter into such
Assignment and Acceptance; (iv) such assignee will, independently and without
reliance upon the assigning Lender, the Agent or
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any Lender and based on such documents and information as it shall deem
appropriate at the time, continue to make its own credit decisions in taking or
not taking action under this Agreement, the Intercreditor Agreement, the
Inter-Lender Agreement, and the other Related Documents; (v) such assignee
appoints and authorizes the Agent to take such action as agent on its behalf and
to exercise such powers under this Agreement, the Intercreditor Agreement, the
Inter-Lender Agreement, and the other Related Documents as are delegated to the
Agent by the terms thereof, together with such powers as are reasonably
incidental thereto; and (vi) such assignee agrees that it will perform in
accordance with their terms all of the obligations which by the terms of this
Agreement and the other Related Documents are required to be performed by it as
a Lender.
(c) The Agent shall maintain at its address referred
to on the signature page hereto, a copy of each Assignment and Acceptance
delivered to and accepted by it and a register for the recordation of the names
and addresses of the Lenders and the Revolving Credit Commitment of, and
principal amount of the Loans owing to and the participation interest in the
Letters of Credit of, each Lender from time to time (the "Register"). The
entries in the Register shall be conclusive and binding for all purposes, absent
manifest error, and the Borrowers, the Agent and the Lenders may treat each
Person whose name is recorded in the Register as a Lender hereunder for all
purposes of this Agreement. The Register shall be available for inspection by
any Borrower and any Lender at any reasonable time and from time to time upon
reasonable prior notice.
(d) Upon its receipt of an Assignment and Acceptance
executed by an assigning Lender, an assignee Lender, together with the Note
subject to such assignment, the Agent shall, if such Assignment and Acceptance
has been completed and is in substantially the form of Exhibit I hereto, (i)
accept such Assignment and Acceptance, (ii) give prompt notice thereof to Planet
Hollywood and (iii) record the information contained therein in the Register.
Within five (5) Business Days after its receipt of such notice, the Borrowers,
at their own expense, shall execute and deliver to the Agent in exchange for the
surrendered Note a new Note to the order of such assignee Lender in an aggregate
principal amount equal to the Revolving Credit Commitment assumed by it pursuant
to such Assignment and Acceptance, and a new Note to the order of the assigning
Lender in an aggregate principal amount equal to the Revolving Credit Commitment
retained by it hereunder, in each case prepared by the Agent. Such new Note
shall be in an aggregate principal amount equal to the aggregate principal
amount of such surrendered Note, shall be dated the date of the Agent's
acceptance of such assignment and acceptance and shall otherwise be in
substantially the form of Exhibit A hereto.
(e) Each Lender may sell participations to one or
more banks or other entities in or to all or a portion of its rights and
obligations under this Agreement and the other Related Documents (including,
without limitation, all or a portion of its Revolving Credit Commitment and the
Loans owing to it and its participation in Letters of Credit); provided,
however, that (i) such Lender's obligations under this Agreement (including,
without limitation, its Revolving Credit Commitment hereunder) and the other
Related Documents shall remain unchanged; (ii) such Lender shall remain solely
responsible to the other parties hereto for the performance of such obligations,
and the Borrowers, the Agent and the other Lenders shall continue to deal solely
and directly with such Lender in connection with such Lender's rights and
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obligations under this Agreement and the other Related Documents; and (iii) a
participant shall not be entitled to require such Lender to take or omit to take
any action hereunder except (A) action directly effecting an extension of the
maturity dates or decrease in the principal amount of the Loans or Reimbursement
Obligations, or (B) action directly effecting an extension of the due dates of
or a decrease in the rate of interest payable on the Loans or the fees payable
under this Agreement, or (C) actions directly effecting a release of all or a
substantial portion of the Collateral (except as set forth in Section 12.08 of
this Agreement or any Related Document).
11.14. Successors and Assigns. This Agreement and the other
Related Documents shall be binding upon and inure to the benefit of the parties
hereto and their respective successors and assigns except that any of the
Borrowers may individually or jointly assign or transfer any of their rights
hereunder or thereunder without the prior written consent of all of the Lenders.
11.15. Confidentiality. Upon delivering to any Lender or the
Agent, or permitting any Lender or the Agent to inspect, any written information
pursuant to this Agreement or the other Related Documents, each Lender and the
Agent shall treat such information as confidential. Each Lender and the Agent
agrees to hold such information in confidence from the date of disclosure
thereof. Subject to the other provisions of this Section 11.15, each Lender and
the Agent may disclose confidential information to its officers, directors,
employees, attorneys, accountants or other professionals engaged by any Lender
or the Agent only after determining that such third party has been instructed to
hold such information in confidence to the same extent as if it were a Lender.
Notwithstanding the foregoing, the provisions of this Section 11.15 shall not
apply to information within any one of the following categories or any
combination thereof: (i) information the substance of which, at the time of
disclosure by any Lender or the Agent, has become publicly available or has been
disclosed to or is known to any creditor (other than information as to which
such creditor is then under an obligation of nondisclosure), or any Person other
than (A) a director, officer, employee or agent of any Borrower or a
professional engaged by any Borrower, or (B) a Person who is then under an
obligation of nondisclosure (otherwise than as a consequence of a wrongful act
of any Lender or the Agent), (ii) non-confidential information which any Lender
or the Agent had in its possession prior to receipt thereof from the disclosing
party other than the Borrowers, or (iii) information received by any Lender or
the Agent from a third party having no obligations of nondisclosure with respect
thereto. Nothing contained in this Section 11.15 shall prevent any disclosure:
(x) believed in good faith by any Lender or the Agent to be required by any law
or guideline or interpretation or application thereof by any Governmental
Authority, arbitrator or grand jury charged with the interpretation or
administration thereof or compliance with any request or directive of any
Governmental Authority, arbitrator or grand jury (whether or not having the
force of law), (y) determined by counsel for any Lender or the Agent to be
necessary or advisable in connection with enforcement or preservation of rights
under or in connection with this Agreement or any other Related Document, or (z)
of any information which has been made public by a Person other than any Lender
or the Agent who, to the Agent's or such Lender's actual knowledge, was then
under an obligation of nondisclosure. The Lenders and the Agent shall have the
right to disclose any confidential information described in this Section 11.15
to the Letter of Credit Issuer and to an assignee or prospective assignee or to
a participant or prospective participant in Loans and Letter of Credit Exposure
hereunder; provided, however, that the assigning or selling Lender
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shall have obtained from such assignee or prospective assignee or participant or
prospective participant an agreement to hold such information in confidence to
the same extent as if it were a Lender.
11.16. Waiver of Jury Trial. BY ITS EXECUTION AND DELIVERY OF
THIS AGREEMENT, THE AGENT, EACH LENDER AND EACH BORROWER HEREBY KNOWINGLY,
VOLUNTARILY AND INTENTIONALLY WAIVE ANY RIGHTS THEY MAY HAVE TO A TRIAL BY JURY
IN RESPECT OF ANY LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER OR IN
CONNECTION WITH, THIS AGREEMENT, THE NOTES OR ANY OTHER RELATED DOCUMENT, ANY OF
THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY OR ANY COURSE OF CONDUCT, COURSE
OF DEALING, STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF THE AGENT, THE
LENDERS, OR ANY BORROWER IN CONNECTION HEREWITH OR THEREWITH. THIS PROVISION IS
A MATERIAL INDUCEMENT FOR THE AGENT AND THE LENDERS TO ENTER INTO THIS
AGREEMENT.
11.17. Right of Setoff. Upon the occurrence and during the
continuance of any Event of Default, each Lender is hereby authorized to, at any
time from time to time, without notice to any Borrower or Guarantor (any such
notice being expressly waived by such Borrower and Guarantor) and to the fullest
extent permitted by law, set off and apply any and all deposits (general or
special, time or demand, provision or final) at any time held and other
indebtedness at any time owing by such Lender, the Agent or the Letter of Credit
Issuer to or for the credit or the account of the Borrowers or Guarantor against
any and all Obligations of the Borrowers now or hereafter existing under the
Loan Documents, irrespective of whether or not any Lender, the Agent and the
Letter of Credit Issuer shall have made any demand hereunder or thereunder and
although such Obligations may be contingent or unmatured. Each Lender, the Agent
and the Letter of Credit Issuer agrees promptly to notify Planet Hollywood after
any such setoff and application made by such Lender, the Agent or the Letter of
Credit Issuer; provided, however, that the failure to give such notice shall not
affect the validity of such setoff and application. The rights of each Lender,
the Agent and the Letter of Credit Issuer under this Section 11.16 are in
addition to the other rights and remedies (including, without limitation, other
rights of setoff under applicable law or otherwise) which such Lender, the Agent
or the Letter of Credit Issuer may have.
11.18. Headings. Section headings herein are included for
convenience of reference only and shall not constitute a part of this Agreement
for any other purpose.
11.19. Forum Selection and Consent to Jurisdiction. Any
litigation based hereon, or arising out of, under or in connection with, this
Agreement or any other Loan Document, or any course of conduct, course of
dealing, statement (whether verbal or written) or action of the Agent, any
Lender, the Letter of Credit Issuer, or the Borrowers may be brought and
maintained exclusively in the courts of the State of New York located in the
borough of Manhattan or the United States District Court for the Southern
District of New York; provided, however, that any suit seeking enforcement
against any Collateral or other property may be brought, at the Agent's option,
in the courts of any jurisdiction where such Collateral or other property may be
found. Each of the Borrowers hereby expressly and irrevocably submits to the
jurisdiction of the courts
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of the State of New York located in the borough of Manhattan and of the United
States District Court for the Southern District of New York for the purpose of
any such litigation and irrevocably agrees to be bound by any judgment rendered
thereby in connection with such litigation. Each of the Borrowers further
irrevocably consents to the service of process (i) by registered or certified
mail, postage prepaid, to the Borrowers at its address for notices contained in
Section 10.05 hereof, such service to become effective five (5) days after such
mailing, or (ii) by personal service within or without the State of New York.
Nothing herein shall affect the right of the Agent, any Lender or the Letter of
Credit Issuer to service of process in any other manner permitted by law. Each
of the Borrowers hereby expressly and irrevocably waives, to the fullest extent
permitted by law, any objection which it may now or hereafter have to the laying
of venue of any such litigation brought in any such court referred to above and
any claim that any such litigation has been brought in an inconvenient forum. To
the extent that any Borrower has or hereafter may acquire any immunity from
jurisdiction of any court or from any legal process (whether through service or
notice, attachment prior to judgment, attachment in aid of execution or
otherwise) with respect to itself or its property, such Borrower hereby
irrevocably waives such immunity in respect of its obligations under this
Agreement and the other Loan Documents.
ARTICLE XII
THE AGENT
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12.01. Appointment. Each Lender (and each subsequent holder of
any Note by its acceptance thereof) hereby irrevocably appoints and authorizes
CIT, in its capacity as Agent (i) to receive on behalf of each Lender any
payment of principal of or interest on the Notes outstanding hereunder and all
other amounts accrued hereunder for the account of the Lenders and paid to the
Agent, and, subject to Section 2.03 of this Agreement, to distribute promptly to
each Lender its Pro Rata Share of all payments so received (as between CIT and
WLR, at the time and in the manner specified in the Inter-Lender Agreement),
(ii) to distribute to each Lender copies of all material notices and agreements
received by the Agent and not required to be delivered to each Lender pursuant
to the terms of this Agreement; provided, however, that the Agent shall not have
any liability to the Lenders for the Agent's inadvertent failure to distribute
any such notice or agreements to the Lenders, and (iii) subject to Section 11.03
of this Agreement, to take such action as Agent deems appropriate on its behalf
to administer the Loans, Letters of Credit and the Loan Documents and to
exercise such other powers delegated to the Agent by the terms hereof or the
Loan Documents (including, without limitation, the power to give or to refuse to
give notices, waivers, consents, approvals and instructions and the power to
make or to refuse to make determinations and calculations) together with such
powers as are reasonably incidental thereto to carry out the purposes hereof and
thereof. As to any matters not expressly provided for by this Agreement and the
other Loan Documents (including, without limitation, enforcement or collection
of the Notes), the Agent shall not be required to exercise any discretion or
take any action, but shall be required to act or to refrain from acting (and
shall be fully protected in so acting or refraining from acting) upon the
instructions of the Majority Lenders, and such instructions of the Majority
Lenders shall be binding upon all Lenders and all holders of Notes; provided,
however, that the Letter of Credit Issuer shall not be required to refuse to
honor a drawing under any Letter of Credit and the Agent shall not be required
to take any action which,
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in the reasonable opinion of the Agent, exposes the Agent to liability or which
is contrary to this Agreement or any Loan Document or applicable law.
12.02. Nature of Duties. The Agent shall have no duties or
responsibilities except those expressly set forth in this Agreement or in the
Related Documents. The duties of the Agent shall be mechanical and
administrative in nature. The Agent shall not have by reason of this Agreement
or any Related Document a fiduciary relationship in respect of any Lender.
Nothing in this Agreement or any of the Related Documents, express or implied,
is intended to or shall be construed to impose upon the Agent any obligations in
respect of this Agreement or any of the Related Documents except as expressly
set forth herein or therein. Each Lender shall make its own independent
investigation of the financial condition and affairs of the Borrowers in
connection with the making and the continuance of the Loans hereunder and with
the issuance of the Letters of Credit and shall make its own appraisal of the
creditworthiness of each of the Borrowers and the value of the Collateral, and
the Agent shall have no duty or responsibility, either initially or on a
continuing basis, to provide any Lender with any credit or other information
with respect thereto, whether coming into its possession before the initial
Credit Extension hereunder or at any time or times thereafter; provided,
however, that, upon the reasonable request of a Lender, the Agent shall provide
to such Lender any documents or reports delivered to the Agent by the Borrowers
pursuant to the terms of this Agreement or any Related Document. If the Agent
seeks the consent or approval of the Majority Lenders to the taking or
refraining from taking any action hereunder, the Agent shall send notice thereof
to each Lender. The Agent shall promptly notify each Lender any time that the
Majority Lenders have instructed the Agent to act or refrain from acting
pursuant hereto.
12.03. Rights, Exculpation, Etc. The Agent and its directors,
officers, agents or employees shall not be liable for any action taken or
omitted to be taken by it or them under or in connection with this Agreement or
the other Loan Documents, except for their own gross negligence or willful
misconduct as determined by a final judgment of a court of competent
jurisdiction. Without limiting the generality of the foregoing, the Agent (i)
may treat the payee of any Note as the holder thereof until the Agent receives
written notice of the assignment or transfer thereof, pursuant to Section 11.13
hereof, signed by such payee and in form satisfactory to the Agent; (ii) may
consult with legal counsel (including, without limitation, counsel to the Agent
or counsel to the Borrowers), independent public accountants, and other experts
selected by it and shall not be liable for any action taken or omitted to be
taken in good faith by it in accordance with the advice of such counsel,
accountants or experts; (iii) makes no warranty or representation to any Lender
and shall not be responsible to any Lender for any statements, certificates,
warranties or representations made in or in connection with this Agreement or
the other Loan Documents; (iv) shall not have any duty to ascertain or to
inquire as to the performance or observance of any of the terms, covenants or
conditions of this Agreement or the other Loan Documents on the part of any
Person, the existence or possible existence of any Potential Default or Event of
Default, or to inspect the Collateral or other property (including, without
limitation, the books and records) of any Person; (v) shall not be responsible
to any Lender for the due execution, legality, validity, enforceability,
genuineness, sufficiency or value of this Agreement or the other Loan Documents
or any other instrument or document furnished pursuant hereto or thereto; and
(vi) shall not be deemed to have made any representation or warranty regarding
the existence, value or collectibility of the Collateral, the existence,
priority or
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perfection of the Agent's Lien thereon, or the Borrowing Base or any certificate
prepared by the Borrowers in connection therewith, nor shall the Agent be
responsible or liable to the Lenders for any failure to monitor or maintain the
Borrowing Base or any portion of the Collateral. The Agent shall not be liable
for any apportionment or distribution of payments made by it in good faith
pursuant to Section 2.08(c), and if any such apportionment or distribution is
subsequently determined to have been made in error the sole recourse of any
Lender to whom payment was due but not made, shall be to recover from other
Lenders any payment in excess of the amount which they are determined to be
entitled. The Agent may at any time request instructions from the Lenders with
respect to any actions or approvals which by the terms of this Agreement or of
any of the Related Documents the Agent is permitted or required to take or to
grant, and if such instructions are promptly requested, the Agent shall be
absolutely entitled to refrain from taking any action or to withhold any
approval under any of the Related Documents until it shall have received such
instructions from the Majority Lenders. Without limiting the foregoing, no
Lender shall have any right of action whatsoever against the Agent as a result
of the Agent acting or refraining from acting under this Agreement, the Notes,
or any of the other Related Documents in accordance with the instructions of the
Majority Lenders.
12.04. Reliance. The Agent shall be entitled to rely upon any
written notices, statements, certificates, orders or other documents or any
telephone message believed by it in good faith to be genuine and correct and to
have been signed, sent or made by the proper Person, and with respect to all
matters pertaining to this Agreement or any of the Related Documents and its
duties hereunder or thereunder, upon advice of counsel selected by it.
12.05. Indemnification. To the extent that the Agent is not
reimbursed and indemnified by the Borrowers, the Lenders will reimburse and
indemnify the Agent for and against any and all liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses, advances
or disbursements of any kind or nature whatsoever which may be imposed on,
incurred by, or asserted against the Agent in any way relating to or arising out
of this Agreement or any of the Related Documents or any action taken or omitted
by the Agent under this Agreement or any of the Related Documents, in proportion
to each Lender's Pro Rata Share, including, without limitation, advances and
disbursements made pursuant to Section 12.08; provided, however, that no Lender
shall be liable for any portion of such liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses, advances or
disbursements for which there has been a final judicial determination that such
resulted from the Agent's gross negligence or willful misconduct. The
obligations of the Lenders under this Section 12.05 shall survive the payment in
full of the Loans and Reimbursement Obligations and the termination of this
Agreement.
12.06. Lenders Individually. With respect to its Pro Rata
Share of the Revolving Credit Commitments hereunder, the Loans made by it and
the Note issued to or held by it, CIT shall have and may exercise the same
rights and powers hereunder and is subject to the same obligations and
liabilities as and to the extent set forth herein for any other Lender or holder
of a Note. The terms "Lenders" or "Majority Lenders" or any similar terms shall,
unless the context clearly otherwise indicates, include CIT in its individual
capacity as a Lender or one of the Majority Lenders. CIT, WLR and their
respective Affiliates may lend money to, and generally engage in any kind of
banking, trust or other business with the Borrowers or any of their
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respective Subsidiaries without any duty to account to the Lenders, and CIT may
do so as if it were not acting as Agent pursuant hereto.
12.07. Successor Agent.
(a) The Agent may resign from the performance of all
its functions and duties hereunder and under the other Related Documents at any
time by giving at least thirty (30) Business Days' prior written notice to
Planet Hollywood and each Lender. Such resignation shall take effect upon the
acceptance by a successor Agent of appointment pursuant to clauses (b) and (c)
below or as otherwise provided below.
(b) Upon any such notice of resignation, the Majority
Lenders shall appoint a successor Agent who shall be reasonably satisfactory to
Planet Hollywood. Upon the acceptance of any appointment as Agent hereunder by a
successor Agent, such successor Agent shall thereupon succeed to and become
vested with all the rights, powers, privileges and duties of the retiring Agent,
and the retiring Agent shall be discharged from its duties and obligations under
this Agreement and the other Related Documents. After any Agent's resignation
hereunder as the Agent, the provisions of this Article XII shall inure to its
benefit as to any actions taken or omitted to be taken by it while it was Agent
under this Agreement and the other Related Documents.
(c) If a successor Agent shall not have been so
appointed within said thirty (30) Business Day period, the retiring Agent, with
the consent of Planet Hollywood, shall then appoint a successor Agent who shall
serve as Agent until such time, if any, as the Majority Lenders, with the
consent of Planet Hollywood, appoint a successor Agent as provided above.
12.08. Collateral Matters.
(a) The Agent may from time to time, during the
occurrence and continuance of an Event of Default, make such disbursements and
advances ("Agent Advances") which the Agent, in its sole discretion, deems
necessary or desirable to preserve or protect the Collateral or any portion
thereof, to enhance the likelihood or maximize the amount of repayment by the
Borrowers of the Loans and other Obligations or to pay any other amount
chargeable to the Borrowers pursuant to the terms of this Agreement, including,
without limitation, costs, fees and expenses as described in Section 11.06. The
Agent Advances shall be repayable on demand and be secured by the Collateral.
The Agent Advances shall not constitute Loans but shall otherwise constitute
Obligations hereunder. The Agent shall notify each Lender and Planet Hollywood
in writing of each such Agent Advance, which notice shall include a description
of the purpose of such Agent Advance. Without limitation to its obligations
pursuant to Section 12.05, each Lender agrees that it shall make available to
the Agent, upon the Agent's demand, in Dollars in immediately available funds,
the amount equal to such Lender's Pro Rata Share of each such Agent Advance. If
such funds are not made available to the Agent by such Lender the Agent shall be
entitled to recover such funds, on demand from such Lender together with
interest thereon, for each day from the date such payment was due until the date
such amount is paid to the Agent, at the customary rate set by the Agent for the
correction of errors among banks for three (3) Business Days and thereafter at
the Regular Rate.
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(b) The Lenders hereby irrevocably authorize the
Agent, at its option and in its discretion, to release any Lien granted to or
held by the Agent upon any Collateral upon termination of the Revolving Credit
Commitments and payment and satisfaction of all Loans, Reimbursement
Obligations, other Letter of Credit Exposure (whether or not due) and all other
Obligations which have matured and which the Agent has been notified in writing
are then due and payable; or constituting property being sold or disposed of if
Planet Hollywood certifies to the Agent that the sale or disposition is made in
compliance with Section 9.04 (b) hereof (and the Agent may rely conclusively on
any such certificate, without further inquiry); or constituting property in
which no Borrower owned any interest at the time the Lien was granted or at any
time thereafter; or if approved, authorized or ratified in writing by the
Majority Lenders. Upon request by the Agent at any time, the Lenders will
confirm in writing the Agent's authority to release particular types or items of
Collateral pursuant to this Section 12.08(b).
(c) Without in any manner limiting the Agent's
authority to act without any specific or further authorization or consent by the
Majority Lenders (as set forth in Section 12.08(b)), each Lender agrees to
confirm in writing, upon request by the Agent, the authority to release
Collateral conferred upon the Agent under Section 12.08(b). So long as no Event
of Default is then continuing, upon receipt by the Agent of confirmation from
the Majority Lenders of its authority to release any particular item or types of
Collateral, and upon prior written request by Planet Hollywood, the Agent shall
(and is hereby irrevocably authorized by the Lenders to) execute such documents
as may be necessary to evidence the release of the Liens granted to the Agent
for the benefit of the Lenders upon such Collateral; provided, however, that (i)
the Agent shall not be required to execute any such document on terms which, in
the Agent's opinion, would expose the Agent to liability or create any
obligations or entail any consequence other than the release of such Liens
without recourse or warranty, and (ii) such release shall not in any manner
discharge, affect or impair the Obligations or any Lien upon (or obligations of
the Borrowers in respect of) all interests in the Collateral retained by the
Borrowers.
(d) The Agent shall have no obligation whatsoever to
any Lenders to assure that the Collateral exists or is owned by any Borrower or
is cared for, protected or insured or has been encumbered or that the Lien
granted to the Agent pursuant to the Security Documents has been properly or
sufficiently or lawfully created, perfected, protected or enforced or is
entitled to any particular priority, or to exercise at all or in any particular
manner or under any duty of care, disclosure or fidelity, or to continue
exercising, any of the rights, authorities and powers granted or available to
the Agent in this Section 12.08 or in any of the Related Documents, it being
understood and agreed that in respect of the Collateral, or any act, omission or
event related thereto, the Agent may act in any manner it may deem appropriate,
in its sole discretion, given the Agent's own interest in the Collateral as one
of the Lenders and that the Agent shall have no duty or liability whatsoever to
any other Lender.
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ARTICLE XIII
OTHER MATTERS
-------------
13.01. Members and TSP Membership Interest. Schedule 13.01
hereto sets forth or attaches a true and complete list setting forth (i) each
member of TSP, (ii) the percentage membership interest in TSP currently owned by
each such Person, (iii) the current balance of such Person's capital account in
TSP, (iv) a copy of each Schedule K-1 received by a Borrower or a Guarantor with
respect to the TSP Membership Interest and each tax return filed by TSP, and (v)
a description, including the principal amount, interest, term and lender, of all
debt of TSP.
13.02. Affirmative Covenant. So long as any principal of or
interest on the Loans or the Reimbursement Obligations or any other Obligations
(whether or not due) shall remain unpaid or the Lenders shall have any Revolving
Credit Commitment hereunder, Hospitality will, unless the Majority Lenders shall
otherwise consent in writing, perform, observe and comply in all material
respects with all of its obligations under each pledge, assignment and each
other agreement with respect to the TSP Membership Interest, and will use its
best efforts to cause each other party to each such pledge, assignment or other
agreement to perform, observe and comply in all material respects with all of
such other party's obligations under each such pledge, assignment or other
agreement.
13.03. Negative Covenant. So long as any principal of or
interest on the Loans or the Reimbursement Obligations or any other Obligations
(whether or not due) shall remain unpaid or the Lenders shall have any Revolving
Credit Commitment hereunder, neither the Borrowers nor the Guarantors will,
without the prior written consent of the Majority Lenders (which consent shall
not be unreasonably withheld), (i) amend, modify, terminate or waive any
provision of the TSP Agreement, (ii) fail to exercise promptly and diligently
each and every right which it may have under the TSP Agreement, or (iii) fail to
deliver to the Agent a copy of each demand, notice or other document received or
given by it relating in any way to the TSP Membership Interest. In no event
shall any Borrower or Guarantor withdraw from or cause or consent to the
dissolution of TSP without the prior written consent of the Majority Lenders
(which consent shall not be unreasonably withheld).
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IN WITNESS WHEREOF, the parties hereto, by their officers
thereunto duly authorized, have executed and delivered this Agreement as of the
date first above written.
BORROWERS:
PLANET HOLLYWOOD
INTERNATIONAL, INC.
By: ______________________________________
Name: Xxxxxx Xxxxxxxx
Title: Chief Financial Officer
PLANET HOLLYWOOD MEMORABILIA, INC.
By: ______________________________________
Name: Xxxxxx Xxxxxxxx
Title: Chief Financial Officer
ALL STAR CAFE INTERNATIONAL, INC.
By: ______________________________________
Name: Xxxxxx Xxxxxxxx
Title: Chief Financial Officer
ALL STAR CAFE (NEW YORK), INC.
By: ______________________________________
Name: Xxxxxx Xxxxxxxx
Title: Chief Financial Officer
COOL PLANET, INC.
By: ______________________________________
Name: Xxxxxx Xxxxxxxx
Title: Chief Financial Officer
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COOL PLANET II, INC.
By: ______________________________________
Name: Xxxxxx Xxxxxxxx
Title: Chief Financial Officer
PLANET HOLLYWOOD
(ATLANTIC CITY), INC.
By: ______________________________________
Name: Xxxxxx Xxxxxxxx
Title: Chief Financial Officer
PLANET HOLLYWOOD (HONOLULU), INC.
By: ______________________________________
Name: Xxxxxx Xxxxxxxx
Title: Chief Financial Officer
PLANET HOLLYWOOD (LP), INC.
By: ______________________________________
Name: Xxxxxx Xxxxxxxx
Title: Chief Financial Officer
PLANET HOLLYWOOD
(NEW YORK CITY), INC.
By: ______________________________________
Name: Xxxxxx Xxxxxxxx
Title: Chief Financial Officer
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PLANET HOLLYWOOD NEW YORK, LTD.
By: PLANET HOLLYWOOD
INTERNATIONAL, INC., its
General Partner
By: ______________________________________
Name: Xxxxxx Xxxxxxxx
Title: Chief Financial Officer
PLANET HOLLYWOOD (ORLANDO), INC.
By: ______________________________________
Name: Xxxxxx Xxxxxxxx
Title: Chief Financial Officer
PLANET HOLLYWOOD (REGION II), INC.
By: ______________________________________
Name: Xxxxxx Xxxxxxxx
Title: Chief Financial Officer
PLANET HOLLYWOOD (REGION III), INC.
By: ______________________________________
Name: Xxxxxx Xxxxxxxx
Title: Chief Financial Officer
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PLANET HOLLYWOOD (REGION IV), INC.
By: ______________________________________
Name: Xxxxxx Xxxxxxxx
Title: Chief Financial Officer
PLANET HOLLYWOOD (REGION V), INC.
By: ______________________________________
Name: Xxxxxx Xxxxxxxx
Title:
PLANET HOLLYWOOD (REGION VI), INC.
By: ______________________________________
Name: Xxxxxx Xxxxxxxx
Title: Chief Financial Officer
PLANET HOLLYWOOD (REGION VII), INC.
By: ______________________________________
Name: Xxxxxx Xxxxxxxx
Title: Chief Financial Officer
PLANET HOLLYWOOD (TEXAS), LTD.
By: PLANET HOLLYWOOD
(REGION V), INC., its General
Partner
By: ______________________________________
Name: Xxxxxx Xxxxxxxx
Title:
PLANET HOLLYWOOD (WAREHOUSE), INC.
By: ______________________________________
Name: Xxxxxx Xxxxxxxx
Title: Chief Financial Officer
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Address for Notices:
-------------------
Planet Hollywood International, Inc. Corporate
Xxxxxx
0000 Xxxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxx 00000
Attention: Chief Financial Officer
Telephone: (000) 000-0000
Telecopier: (000) 000-0000
AGENT AND LENDER:
CIT GROUP/BUSINESS CREDIT, INC.
By: ______________________________________
Name: Xxxxxxxx Xxxxxxx
Title: Senior Vice President
Address for Notices:
-------------------
The CIT Group/Business
Credit, Inc.
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxx Xxxxx
Telephone: (000) 000-0000
Telecopier: (000) 000-0000
with a copy to:
Xxxxxxx Xxxx & Xxxxx LLP
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxxx X. Xxxxxxx, Esq.
Telephone: (000) 000-0000
Telecopier: (000) 000-0000
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LENDER:
WLR RECOVERY FUND L.P.
By: WLR RECOVERY ASSOCIATES LLC,
as its General Partner
By: ____________________________________
Name: Xxxxxx Xxxx
Title: Managing Member
Address for Notices:
-------------------
WLR Recovery Fund L.P.
1251 Avenue of the Xxxxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxx Xxxx
Telephone: (000) 000-0000
Telecopier: (000) 000-0000
with a copy to:
Xxxx Xxxxxxx & Xxxxxx LLP
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxxx Xxxx, Esq.
Telephone: (000) 000-0000
Telecopier: (000) 000-0000
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ACKNOWLEDGED AND AGREED:
-----------------------
PLANET HOLLYWOOD (REGION III), INC.
By: __________________________________
Name: Xxxxxx Xxxxxxxx
Title: Chief Financial Officer
PLANET HOSPITALITY HOLDINGS, INC.
By: __________________________________
Name: Xxxxxx Xxxxxxxx
Title: Chief Financial Officer
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ANNEX I
-------
PLANET HOLLYWOOD MEMORABILIA, INC.
ALL STAR CAFE INTERNATIONAL, INC.
ALL STAR CAFE (NEW YORK), INC.
COOL PLANET, INC.
COOL PLANET II, INC.
PLANET HOLLYWOOD (ATLANTIC CITY), INC.
PLANET HOLLYWOOD (HONOLULU), INC.
PLANET HOLLYWOOD (LP), INC.
PLANET HOLLYWOOD (NEW YORK CITY), INC.
PLANET HOLLYWOOD NEW YORK, LTD.
PLANET HOLLYWOOD (ORLANDO), INC.
PLANET HOLLYWOOD (REGION II), INC.
PLANET HOLLYWOOD (REGION III), INC.
PLANET HOLLYWOOD (REGION IV), INC.
PLANET HOLLYWOOD (REGION V), INC.
PLANET HOLLYWOOD (REGION VI), INC.
PLANET HOLLYWOOD (REGION VII), INC.
PLANET HOLLYWOOD (TEXAS), LTD.
PLANET HOLLYWOOD (WAREHOUSE), INC.
