<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON D.C. 20549
--------------------
FORM 10-Q
(MARK ONE)
|X| QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934.
For the quarterly period ended September 27, 1998
| | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934.
For the transition period from to
------------ ------------
-------------
COMMISSION FILE NUMBER: 1-13044
COOKER RESTAURANT CORPORATION
(Exact Name of Registrant as Specified in its Charter)
OHIO 62-1292102
(State or Other Jurisdiction of (I.R.S. Employer Identification No.)
Incorporation or Organization)
5500 VILLAGE BOULEVARD, WEST PALM BEACH, FLORIDA 33407
(Address of Principal Executive Offices) (Zip Code)
Registrant's Telephone Number, Including Area Code: (561) 615-6000
Indicate by check X whether the registrant: (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange
Act of 1934 during the preceding 12 months (or for such shorter period
that the registrant was required to file such reports), and (2) has been
subject to such requirements for the past 90 days.
|X| | |
Yes No
6,177,000 COMMON SHARES, WITHOUT PAR VALUE
(number of common shares outstanding as of the close of business
on November 9, 1998)
<PAGE> 2
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS.
<TABLE>
COOKER RESTAURANT CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEET
(UNAUDITED)
(In Thousands)
<CAPTION>
September 27, December 28,
1998 1997
------------- ------------
<S> <C> <C>
ASSETS
Current Assets:
Cash and cash equivalents $ 1,697 $ 4,685
Inventory 1,532 1,509
Land held for sale 55 55
Prepaid and other current assets 904 1,057
-------- --------
Total current assets 4,188 7,306
Property and equipment, net 141,771 134,190
Other assets 1,908 1,425
-------- --------
$147,867 $142,921
======== ========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Current maturities long-term debt $ 6,615 $ --
Notes payable 425 --
Accounts payable 3,849 4,668
Accrued liabilities 5,480 6,857
Income taxes payable 488 61
-------- --------
Total current liabilities 16,857 11,586
Long-term debt 35,800 42,415
Deferred income taxes 2,593 1,813
Other liabilities 628 635
-------- --------
Total liabilities 55,878 56,449
-------- --------
Shareholders' equity:
Common shares-without par value: authorized 30,000,000 shares; issued
10,548,000 at September 27, 1998 and December 28, 1997 62,482 63,039
Retained earnings 33,844 29,570
Treasury stock at cost, 365,000 and 526,000 shares at September 27, 1998 and
December 28, 1997, respectively (4,337) (6,137)
-------- --------
Total shareholders' equity 91,989 86,472
Commitments and contingencies
-------- --------
$147,867 $142,921
======== ========
</TABLE>
See accompanying notes to condensed consolidated financial statements
<PAGE> 3
<TABLE>
COOKER RESTAURANT CORPORATION
CONDENSED CONSOLIDATED STATEMENT OF INCOME
(UNAUDITED)
(In Thousands Except Per Share Data)
<CAPTION>
Three Months Ended Nine Months Ended
September 27, September 28, September 27, September 28,
1998 1997 1998 1997
------------- -------------- ------------- -------------
<S> <C> <C> <C> <C>
Sales $38,018 $34,167 $118,407 $99,895
------- ------- -------- -------
Cost of Sales:
Food and beverage 11,000 9,805 33,916 28,638
Labor 13,614 11,830 41,397 34,407
Restaurant operating expenses 7,227 6,043 21,559 17,156
Restaurant depreciation 1,570 1,126 4,590 3,250
General and administrative 2,652 2,522 7,595 6,645
Interest expense, net 747 485 2,074 1,160
------- ------- -------- -------
36,810 31,811 111,131 91,256
Income before income taxes and cumulative
of a change in accounting principle 1,208 2,356 7,276 8,639
Provision for income taxes before
cumulative effect of a change in
accounting principle 411 808 2,299 2,961
------- ------- -------- -------
Income before cumulative
effect of a change in
accounting principle 797 1,548 4,977 5,678
Cumulative effect of a change in accounting
for preoperational costs (less tax of $253) -- -- -- 496
------- ------- -------- -------
Net income $ 797 $ 1,548 $ 4,977 $ 5,182
======= ======= ======== =======
Basic earnings per share:
Income before cumulative effect of a
change in accounting principle $ 0.08 $ 0.15 $ 0.49 $ 0.57
Cumulative effect of a change in
accounting for preoperational costs -- -- -- (0.05)
------- ------- -------- -------
Net income $ 0.08 $ 0.15 $ 0.49 $ 0.52
======= ======= ======== =======
Diluted earnings per share:
Income before cumulative effect of change
in accounting principle $ 0.08 $ 0.15 $ 0.49 $ 0.55
Cumulative effect of change in
accounting for preoperational costs -- -- -- (0.05)
------- ------- -------- -------
Net income $ 0.08 $ 0.15 $ 0.49 $ 0.50
======= ======= ======== =======
Weighted average number of common
shares outstanding - basic 10,174 10,019 10,108 10,024
Weighted average number of common
shares outstanding - diluted 10,313 10,204 10,260 10,242
</TABLE>
See accompanying notes to condensed consolidated financial statements
<PAGE> 4
<TABLE>
COOKER RESTAURANT CORPORATION
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
(UNAUDITED)
(In Thousands)
<CAPTION>
Nine Months Ended
September 27, September 28,
1998 1997
------------- -------------
<S> <C> <C>
Cash flows from operating activities:
Net Income $ 4,977 $ 5,182
Adjustments to reconcile net income to net cash provided by
operating activities:
Cumulative effect of change in accounting principle -- 496
Depreciation and amortization 4,933 3,669
Deferred income taxes 780 253
(Gain) on sale of property (239) (53)
Decrease (increase) in current assets 130 (215)
(Increase) decrease in other assets (483) 88
(Decrease) in current liabilities (1,647) (1,768)
-------- --------
Net cash provided by operating activities 8,451 7,652
-------- --------
Cash flows from investing activities:
Purchases of property and equipment (13,651) (24,017)
Proceeds from sale of property and equipment 1,374 1,486
-------- --------
Net cash used in investing activities (12,277) (22,531)
-------- --------
Cash flows from financing activities:
Proceeds from note payable 425 --
Payments on note payable -- (4,613)
Proceeds from borrowings -- 20,983
Redemption of debentures -- (48)
Exercise of stock options 1,244 --
Purchase of treasury stock -- (536)
Capital lease obligations (129) --
Dividends paid (702) (702)
-------- --------
Net cash provided by financing activities 838 15,084
-------- --------
Net (decrease) increase in cash and cash equivalents (2,988) 205
Cash and cash equivalents at beginning of period 4,685 2,009
Cash and cash equivalents at end of period $ 1,697 $ 2,214
======== ========
</TABLE>
See accompanying notes to condensed financial statements
<PAGE> 5
COOKER RESTAURANT CORPORATION
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
September 27, 1998 and September 28, 1997
Note 1: Basis of Presentation
The accompanying unaudited condensed consolidated financial statements have
been prepared in accordance with the instructions to Form 10-Q and, therefore,
do not include all of the information and footnotes required by generally
accepted accounting principles for complete financial statements. In the opinion
of management, the accompanying condensed consolidated financial statements
contain all adjustments, consisting of normal recurring accruals, necessary to
present fairly the financial position of the Cooker Restaurant Corporation and
subsidiaries (the "Company"), after elimination of intercompany accounts and
transactions, at September 27, 1998, and the statements of income and cash flows
for the three and nine months ended September 27, 1998. The results of
operations for the three and nine months ended September 27, 1998, are not
necessarily indicative of the operating results expected for the fiscal year
ended January 3, 1999. These financial statements should be read in conjunction
with the financial statements and notes thereto contained in the Company's
annual report on Form 10-K for the fiscal year ended December 28, 1997.
Certain amounts in the 1997 financial statements have been reclassified to
conform to the 1998 presentation.
Note 2: Earnings Per Share
In December 1997, the Company adopted the provisions of Statement of Financial
Accounting Standards ("SFAS") No. 128 "Earnings Per Share," which establishes
new guidelines for the calculation of earnings per share. Basic earnings per
share have been computed by dividing net income by the weighted average number
of shares outstanding during the year. Diluted earnings per share have been
computed assuming the exercise of stock options, as well as their related income
tax effects. Earnings per share for all prior periods have been restated to
reflect the provisions of this statement.
Convertible subordinated debentures outstanding as of September 27, 1998, are
convertible into 691,710 shares of common stock at $21.5625 per share and are
due October 2002. These were not included in the computation of diluted EPS for
each of the quarters ended September 28, 1997, and September 27, 1998, as the
inclusion of the convertible subordinated debentures would be antidilutive.
Options to purchase 867,602 and 856,215 shares at prices ranging from $10.375
to $21.75 per share and $10.375 to $21.75 per share, were outstanding for the
nine months ended September 27, 1998, and September 28, 1997, respectively, but
were not included in the computation of diluted EPS because the options'
exercise prices were greater than the average market price of the common shares
for the nine months ended September 27, 1998 and September 28, 1997,
respectively. The options expire between October 1999 and July 2008 for the nine
months ended September 27, 1998 and between October 1999 and January 2007 for
the nine months ended September 28, 1997.
Note 3: Recent Accounting Pronouncements
Effective December 29, 1997, the Company adopted the provisions of SFAS. No.
130 "Reporting Comprehensive Income" and SFAS No. 131 "Disclosures about
Segments of an Enterprise." The adoption of these pronouncements did not have a
significant effect on the Company's consolidated financial position , results of
operations or cash flows.
In June 1998, the Financial Accounting Standards Board ("FASB") issued SFAS.
No 133 "Accounting for Derivative Instruments and Hedging Activities" ("SFAS No.
133"). This statement establishes accounting and reporting standards for
derivative instruments, including certain derivative instruments embedded in
other contracts (collectively referred to as derivatives) and for hedging
activities. It requires that an entity recognize all derivatives as either
assets or liabilities in the statement of financial position and measure those
instruments at fair value. If certain conditions are met, a derivative may be
specifically designated as (a) a hedge of the exposure to changes in
<PAGE> 6
fair value of a recognized asset, (b) a hedge of the exposure to variable cash
flows of a forecasted transaction, or (c) a hedge of the foreign currency
exposure of a net investment in a foreign operation, an unrecognized firm
commitment, an available-for-sale security, or a foreign-currency-denominated
forecasted transaction. The accounting for the changes in the fair value of a
derivative (this is, gains and losses) depends on the intended use of the
derivative and the resulting designation. This statement shall be effective for
all fiscal quarters of all fiscal years beginning after June 15, 1999. The
Company has not determined the effect of the adoption of SFAS No. 133 on the
Company's results of operations or statement of financial position.
Note 4: ESOP Termination
During the third quarter the Board of Directors approved the termination of
the Cooker Restaurant Corporation Employee Stock Ownership Plan (the "Plan").
The effective date of the termination was June 30, 1998. The Plan termination
did not have a significant impact on the Company's consolidated financial
position, results of operations, or cash flows.
Note 5: Derivative Financial Instruments
The fair value of the interest rate swap agreement approximated ($1,192,000)
at September 27, 1998. The fair value is estimated using option pricing models
that value the potential for swaps to become in-the-money (liability) through
changes in interest rates during the remaining term of the agreement.
Note 6: Subsequent Events
On August 11, 1998, the Company announced that it intended to commence a Dutch
Auction tender offer (the "Offer") to purchase for cash up to 4,000,000 shares
of its issued and outstanding common stock, without par value, at a purchase
price of not greater than $12.00 nor less than $10.50 per share. On August 12,
1998, the Company filed with the Securities and Exchange Commission an Issuer
Tender Offer Statement on Schedule 13-E4 (the "Statement") relating to the
Offer. The Statement was subsequently amended on August 21, 1998; September 11,
1998; September 18, 1998; and October 5, 1998.
The Offer expired at 5:00 p.m. on Friday, September 28, 1998. As a result of
the Offer, 7,097,630 shares were properly tendered at the tendering price of
$10.50. Accordingly, the number of shares actually purchased from each
shareholder tendering at $10.50 (other than holders of fewer than 100 shares,
whose shares were not subject to proration) was prorated based upon the
proration method described in the Offer. The final proration factor was
approximately 56.21%. On Monday, October 5, 1998, the Company purchased
4,006,298 of its common stock, without par value, at a price of $10.50 per
share. Pursuant to the terms of the Offer, the total number of shares purchased
by the Company exceeded 4,000,000 because the Company exercised its right to
purchase additional shares from tendering shareholders who otherwise hold fewer
than 100 shares after the share repurchase as a result of proration. The shares
of stock purchased in the Offer represent approximately 39% of the 10,159,354
shares of common stock issued and outstanding immediately prior to the Offer on
August 11, 1998. Subsequent to the purchase, the Company had approximately
6,153,056 shares of its common stock, without par value, issued and outstanding.
To finance the purchase, the Company entered into debt finance agreements with
NationsBank of Tennessee, N.A. ("NationsBank"), First Union National Bank
("First Union"), and The CIT Group/Equipment Financing, Inc. ("CIT"). The
agreement with NationsBank and First Union provides for a credit facility of
$62,500,000, of which $52,500,000 is a term loan (the "Term Loan") with
NationsBank and First Union and $10,000,000 is a revolving loan (the "Revolver")
with NationsBank only. The agreement is secured by 36 properties owned by the
Company. The Term Loan is funded by NationsBank and First Union. In conjunction
with the new financing, NationsBank provided funding of $55,500,000, less
applicable fees of $156,000. Of this amount, approximately $27,856,000 was used
to pay off the existing First Union revolving Line of Credit, which had an
outstanding balance of $27,500,000 at September 27, 1998, as well as an
additional existing loan and accrued interest and fees. Subsequent to the pay
off of the existing First Union revolving Line of Credit, First Union provided
the Company with a term loan of $22,500,000, which was used to repay a portion
of the amount provided by NationsBank. As a result of these transactions, the
Company has a Term Loan outstanding in the amount of $52,500,000, of which
$30,000,000 is owed to NationsBank and $22,500,000 is owed to First Union. The
remaining amount received from NationsBank
<PAGE> 7
of $3,000,000 represents a draw against the new $10,000,000 Revolver. Under the
terms of the agreement, the Term Loan will mature on March 24, 2004. Interest on
the Term Loan and Revolver is LIBOR plus an applicable margin, which, per the
terms of the agreement, may vary between 1.0% and 2.25%, depending on the
Company's ratio of funded debt to Earnings before Interest, Taxes, Depreciation,
and Amortization (EBITDA). Commencing October 1, 1998, the Company will make
interest-only payments on the Term Loan and any outstanding amounts against the
Revolver through March 24, 1999. No later than March 24, 1999, the Company may
enter into a second closing with First Union and NationsBank, at which time the
Term Loan and the Revolver may be renewed at $62,500,000 or 70% of the value of
the properties pledged as collateral, whichever is less. Commencing in March of
1999, the Company will make equal monthly payments of approximately $356,000 on
the First Union debt amount, representing principal and interest, and principal
payments of approximately $167,000, plus interest, on the NationsBank debt
through March 24, 2004, at which time, all remaining amounts, principal and
interest, on the Term Loan and the Revolver will be due in full.
In addition to the loans from First Union and NationsBank, the Company entered
into a loan agreement with CIT in the amount of $18,000,000. This loan is
secured by certain equipment owned by the Company. Interest on the loan with CIT
is at LIBOR plus 1.85%. Monthly payments of approximately $268,000, including
principal and interest, will commence in October of the current year and will
continue through September 2003, at which time the remaining principal balance,
plus accrued interest, will be due in full.
Note 7: Pro Forma Financial Statement Disclosure
As disclosed in Note 6 to the unaudited condensed consolidated financial
statements, subsequent to the quarter ended September 27, 1998, the Company
completed its Tender Offer and repurchased 4,006,298 of its common shares, no
par value. In conjunction with the purchase, the Company entered into new
long-term debt agreements with NationsBank, First Union, and CIT.
As a result of these transactions, assuming they occurred at the beginning of
the current year, total debt of the Company at September 27, 1998 would have
been $88,415,000, of which, $1,615,000 would be classified as current and
$86,800,000 as long-term, rather than the reported total debt of $42,415,000, of
which $6,615,000 is classified as current and $35,800,000 is classified as
long-term. The difference of $46,000,000 represents the additional NationsBank
and CIT debt acquired, offset by the reduction in the First Union debt of
$5,000,000. In addition, the cash balance of the Company would have been
$5,631,000, rather than the reported amount of $1,697,000, representing the
additional funds available after consummation of the borrowings and the
subsequent purchase of the common shares and payment of related miscellaneous
fees. Also, the balance of Treasury Stock reported at September 27, 1998 would
have been ($46,403,000) rather than the reported amount of ($4,337,000),
reflecting the purchase of 4,006,298 common shares at a price of $10.50 per
share.
Additionally, the weighted-average number of shares outstanding for the three
months and nine months ended September 27, 1998 for the purpose of computing
basic and diluted earnings per share would change assuming the transaction had
occurred at the beginning of the current year. For the three months ended
September 27, 1998, the number of weighted-average shares outstanding for the
purpose of calculating basic and diluted earnings per share would have been
6,167,000 and 6,307,000, respectively. For the nine months ended September 27,
1998, the number of weighted-average shares outstanding for the purpose of
calculating basic and diluted earnings per share would have been 6,102,000 and
6,241,000, respectively.
2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
From time to time, the Company may make certain statements that contain
"forward-looking" information (as defined in the Private Securities Litigation
Reform Act of 1995). Words such as "believe," "anticipate," "project," and
similar expressions are intended to identify such forward-looking statements.
Forward-looking statements may be made by management orally or in writing,
including, but not limited to, in press releases, as part of this Management's
Discussion and Analysis of Financial Condition and Results of Operations and as
part of other sections of this Report or other filings. Readers are cautioned
not to place undue reliance on these forward-looking statements, which speak
only as of their respective dates, and are subject to certain risks,
uncertainties and assumptions. These statements are based on management's
present assumptions as to future trends, including economic trends, prevailing
interest rates, the availability and cost of raw materials, the availability of
capital
<PAGE> 8
resources necessary to complete the Company's expansion plans, government
regulations, especially regulations regarding taxes, labor and alcoholic
beverages, competition, consumer preferences, and similar factors. Changes in
these factors could affect the validity of such assumptions and could have a
materially adverse effect on the Company's business.
RESULTS OF OPERATIONS
The following table sets forth as a percentage of sales certain items
appearing in the Company's statements of income.
<TABLE>
COOKER RESTAURANT CORPORATION
RESULTS OF OPERATIONS
(UNAUDITED)
<CAPTION>
Three Months Ended Nine Months Ended
September 27, September 28, September 27, September 28,
1998 1997 1998 1997
------------- ------------- ------------- -------------
<S> <C> <C> <C> <C>
Sales 100.0 100.0 100.0 100.0
----- ----- ----- -----
Cost of sales:
Food and beverage 28.9 28.7 28.6 28.7
Labor 35.8 34.6 35.0 34.4
Restaurant operating expenses 19.0 17.7 18.2 17.2
Restaurant depreciation 4.1 3.3 3.9 3.2
General and administrative 7.0 7.4 6.4 6.6
Interest expense, net 2.0 1.4 1.8 1.2
----- ----- ----- -----
96.8 93.1 93.9 91.3
----- ----- ----- -----
Income before income taxes and cumulative effect of
a change in accounting principle 3.2 6.9 6.1 8.7
Provision for income taxes before cumulative effect
of a change in accounting principle 1.1 2.4 1.9 3.0
----- ----- ----- -----
Income before cumulative effect of a change in
accounting principle 2.1 4.5 4.2 5.7
Cumulative effect of a change in accounting for
preoperational costs (less tax of $253) 0.0 0.0 0.0 0.5
----- ----- ----- -----
Net income 2.1 4.5 4.2 5.2
===== ===== ===== =====
</TABLE>
Sales for the third quarter of fiscal 1998 increased 11.3% to $38,018,000
compared to sales of $34,167,000 for the third quarter of fiscal 1997. For the
nine month period, sales increased 18.5% to $118,407,000 compared to sales of
$99,895,000 in the same period last year. The increases for both the third
quarter and the nine months are due primarily to the opening of new Restaurants.
Same store sales were down 2.0% for the quarter. Third quarter average unit
volumes per operating week of $45,640 were down 4.9% from last year. The average
check of $11.18 was up 2.6% from last year.
The third quarter and the nine months cost of food and beverage as a
percentage of sales were up 20 basis points and down 10 basis points,
respectively, from the same period last year to 28.9% for the third quarter and
28.6% for the nine months. The increase in the third quarter is primarily due to
high poultry prices for the quarter, as well as a $4 per case increase in the
price of potatoes in September. Dairy prices also increased during the quarter,
while meat and produce costs were stable.
Labor cost as a percentage of sales for the third quarter was up 120 basis
points from last year, due mainly to
<PAGE> 9
decreased sales for the quarter as well as increased bonus costs. Labor cost for
the nine months of fiscal 1998 increased from 34.4% to 35.0%, due mainly to the
increase experienced in the third quarter.
Restaurant operating expense for the third quarter increased to 19.0% as a
percent of sales. Areas showing increased spending were utilities, marketing and
administration, due to additional store openings, continued marketing efforts,
and a much hotter than normal summer. In addition, percentages were affected by
decreased average unit volume for the quarter. Restaurant operating expense for
the nine month period increased from 17.2% in 1997 to 18.2% in 1998. The
increases again came from utilities, administration and marketing.
General and administrative expenses for the third quarter of 7.0% were 40
basis points below last year; nine months expense of 6.4% was 20 basis points
lower than last year. The decrease in the third quarter was due to a decrease in
the number of stores opening during the quarter compared to the same period in
the prior year.
The provision for income taxes in the third quarter as a percentage of income
before taxes was 34.0%, compared to 34.3% for the third quarter of 1997. The
nine months provision for income taxes as a percentage of income before taxes
was 31.6% compared to 34.3% in the prior year. The decrease in the current nine
month period is due in part to a restructuring of state and local tax reporting,
but mainly to a reduced liability in the amount of $175,000 for a prior year
audit.
Net interest expense for the third quarter of 2.0% was 60 basis points more
than last year. For the nine months, interest expense of 1.8% was 60 basis
points higher than last year. The increase in net interest expense in the third
quarter and nine months are the result of increased borrowings on the Company's
line of credit as compared to last year.
LIQUIDITY AND CAPITAL RESOURCES
The Company's operations are subject to factors outside its control. Any one,
or combination of these factors could materially affect the results of the
Company's operations. These factors include: (a) changes in the general economic
conditions in the United States, (b) changes in prevailing interest rates, (c)
changes in the availability and cost of raw materials, (d) changes in the
availability of capital resources necessary to complete the Company's expansion
plans, (e) changes in Federal and State regulations or interpretations of
existing legislation, especially concerning taxes, labor and alcoholic
beverages, (f) changes in the level of competition from current competitors and
potential new competition, and (g) changes in the level of consumer spending and
customer preferences. The foregoing should not be construed as an exhaustive
list of all factors which could cause actual results to differ materially from
those expressed in forward-looking statements made by the Company.
Forward-looking statements made by or on behalf of the Company are based on a
knowledge of its business and the environment in which it operates, but because
of the factors listed above, actual results may differ from those anticipated
results described in those forward-looking statements. Consequently, all of the
forward-looking statements made are qualified by these cautionary statements and
there can be no assurance that the actual results or developments anticipated by
the Company will be realized or, even if substantially realized, that they will
have the expected consequences to or effects on the Company or its business or
operations.
On August 11, 1998, the Company announced that it intended to commence a Dutch
Auction tender offer (the "Offer") to purchase for cash up to 4,000,000 shares
of its issued and outstanding common stock, without par value, at a purchase
price of not greater than $12.00 nor less than $10.50 per share. On August 12,
1998, the Company filed with the Securities and Exchange Commission an Issuer
Tender Offer Statement on Schedule 13-E4 (the "Statement") relating to the
Offer. The Statement was subsequently amended on August 21, 1998; September 11,
1998; September 18, 1998; and October 5, 1998.
The Offer expired at 5:00 p.m. on Friday, September 28, 1998. As a result of
the Offer, 7,097,630 shares were properly tendered at the tendering price of
$10.50. Accordingly, the number of shares actually purchased from each
shareholder tendering at $10.50 (other than holders of fewer than 100 shares,
whose shares were not subject to proration) was prorated based upon the
proration method described in the Offer. The final proration factor was
approximately 56.21%. On Monday, October 5, 1998, the Company purchased
4,006,298 of its common stock, without par value, at a price of $10.50 per
share. Pursuant to the terms of the Offer, the total number of shares purchased
by the Company exceeded 4,000,000 because the Company exercised its right to
purchase additional
<PAGE> 10
shares from tendering shareholders who otherwise hold fewer than 100 shares
after the share repurchase as a result of proration. The shares of stock
purchased in the Offer represent approximately 39% of the 10,159,354 shares of
common stock issued and outstanding immediately prior to the Offer on August 11,
1998. Subsequent to the purchase, the Company had approximately 6,153,056 shares
of its common stock, without par value, issued and outstanding.
To finance the purchase, the Company entered into debt finance agreements with
NationsBank of Tennessee, N.A. ("NationsBank"), First Union National Bank
("First Union"), and The CIT Group/Equipment Financing, Inc. ("CIT"). The
agreement with NationsBank and First Union provides for a credit facility of
$62,500,000, of which $52,500,000 is a term loan (the "Term Loan") with
NationsBank and First Union and $10,000,000 is a revolving loan (the "Revolver")
with NationsBank only. The agreement is secured by 36 properties owned by the
Company. The Term Loan is funded by NationsBank and First Union. In conjunction
with the new financing, NationsBank provided funding of $55,500,000, less
applicable fees of $156,000. Of this amount, approximately $27,856,000 was used
to pay off the existing First Union revolving Line of Credit, which had an
outstanding balance of $27,500,000 at September 27, 1998, as well as an
additional existing loan and accrued interest and fees. Subsequent to the pay
off of the existing First Union revolving Line of Credit, First Union provided
the Company with a term loan of $22,500,000, which was used to repay a portion
of the amount provided by NationsBank. As a result of these transactions, the
Company has a Term Loan outstanding in the amount of $52,500,000, of which
$30,000,000 is owed to NationsBank and $22,500,000 is owed to First Union. The
remaining amount received from NationsBank of $3,000,000 represents a draw
against the new $10,000,000 Revolver. Under the terms of the agreement, the Term
Loan will mature on March 24, 2004. Interest on the Term Loan and Revolver is
LIBOR plus an applicable margin, which, per the terms of the agreement, may vary
between 1.0% and 2.25%, depending on the Company's ratio of funded debt to
Earnings before Interest, Taxes, Depreciation, and Amortization (EBITDA).
Commencing October 1, 1998, the Company will make interest-only payments on the
Term Loan and any outstanding amounts against the Revolver through March 24,
1999. No later than March 24, 1999, the Company may enter into a second closing
with First Union and NationsBank, at which time the Term Loan and the Revolver
may be renewed at $62,500,000 or 70% of the value of the properties pledged as
collateral, whichever is less. Commencing in March of 1999, the Company will
make equal monthly payments of approximately $356,000 on the First Union debt
amount, representing principal and interest, and principal payments of
approximately $167,000, plus interest, on the NationsBank debt through March 24,
2004, at which time, all remaining amounts, principal and interest, on the Term
Loan and the Revolver will be due in full.
In addition to the loans from First Union and NationsBank, the Company entered
into a loan agreement with CIT in the amount of $18,000,000. This loan is
secured by certain equipment owned by the Company. Interest on the loan with CIT
is at LIBOR plus 1.85%. Monthly payments of approximately $268,000, including
principal and interest, will commence in October of the current year and will
continue through September 2003, at which time the remaining principal balance,
plus accrued interest, will be due in full.
The net proceeds from the above loans were used to purchase the shares
tendered as a result of the Offer, as well as for normal capital requirements of
the Company.
Excluding the Offer, the Company's principal capital requirements are for
working capital, new restaurant openings and improvements to existing
restaurants. The majority of the Company's financing for operations, expansion
and working capital is provided by internally generated cash flows from
operations and, prior to the above new financing arrangements, borrowings under
a revolving term loan agreement with First Union, which had an outstanding
balance of $27,500,000 at September 27, 1998. The Company's new $10,000,000
Revolver with NationsBank had an available credit line of $7,000,000 subsequent
to the purchase of common stock associated with the Offer.
During the nine months ended September 27, 1998, the Company opened five new
units. Capital expenditures for these new units and the refurbishing and
remodeling of existing units totaled $13,651,000 and were funded by cash flows
of $8,451,000 from operations, and the Company's available cash balances. The
Company intends to open an additional 2 restaurants in 1998 for a total of 7 new
restaurants. The Company had previously planned to open a total of 12
restaurants in 1998, but in January 1998, after reviewing the results of 1997,
including lower earnings per share in 1997 as compared to 1996 and a consequent
decline in Common Share prices, the Board of Directors determined to delay the
opening of 5 restaurants in order to allow senior management to focus their
efforts on
<PAGE> 11
rebuilding average unit volumes and Shareholder value. Total cash expenditures
for the 1998 expansion are estimated to be approximately $14.5 million. The
Company believes that cash flows from operations together with borrowings under
the new Term Loan and Revolver, as discussed above, will be sufficient to fund
the planned expansion, ongoing maintenance and remodeling of existing
restaurants as well as other working capital requirements.
The Company has only limited involvement with derivative financial instruments
and does not use them for trading purposes. They are used to manage well-defined
interest rate risk. Interest rate swap agreements are used to reduce the
potential impact of increases in interest rates on floating-rate long-term debt.
At September 27, 1998, the Company was party to an interest rate swap agreement
with a termination date of September 28, 2001. The agreement entitles the
Company to receive from the counterparty (a major bank), the amounts, if any, by
which the Company's interest payments on $27,500,000 of its floating LIBOR debt
(included in the $52,500,000 Term loan and the $10,000,000 Revolver) exceed 6.25
percent through the termination date. No amounts were received by the Company
during the quarter ended September 27, 1998.
The fair value of the interest rate swap agreement approximated ($1,192,000)
at September 27, 1998. The fair value is estimated using option pricing models
that value the potential for the swaps to become in-the-money (liability)
through changes in interest rates during the remaining term of the agreement.
The Company is exposed to credit losses in the event of nonperformance by the
counterparties to its interest rate swap agreements. The Company anticipates,
however, that the counterparties will be able to fully satisfy their obligations
under the contracts. The Company does not obtain collateral to support financial
instruments but monitors the credit standing of the counterparties.
In 1994, the Board of Directors approved a guaranty by the Company of a loan
of $5,000,000 to G. Arthur Seelbinder (the "Loan"), the Chairman of the Board.
In January 1997, the Board approved a refinancing of the loan with The Chase
Manhattan Bank of New York (the "Bank"). As refinanced and extended, the Loan
from the Bank bears interest at the Bank's prime rate or LIBOR plus 2%, and was
secured by 570,000 Common Shares and is guaranteed by the Company in the
principal amount up to $6,250,000, including capitalized interest. Pursuant to
the loan agreement between Mr. Seelbinder and the Bank, any reduction of the
principal amount outstanding under the Loan shall not entitle Mr. Seelbinder to
the advancement of additional funds under the Loan. The guaranty provides that
the Bank will sell the pledged shares and apply the proceeds thereof to the Loan
prior to calling on the Company for its guaranty. The term of the Loan has been
extended until January 31, 1999. Pursuant to the Offer Mr. Seelbinder tendered
737,562 shares, approximately 99% of the outstanding Common Shares that he
owned, including all 570,000 shares which secured the Loan. Approximately
414,555 shares were taken up in the Offer for a total price of approximately
$4,352,827. Pursuant to Mr. Seelbinder's letter to the Company dated September
17, 1998, the net after tax proceeds of the sale of 167,652 shares or
approximately $1,408,276 were applied by Mr. Seelbinder to the repayment of
certain personal indebtedness and tax liabilities, the remaining net after tax
proceeds (approximately $2,073,985) were applied to the Loan and the remaining
323,007 Common Shares were returned to the Bank. As of October 15, 1998, the
amount of the Loan outstanding, including capitalized and accrued interest, was
approximately $3,574,025 and the undiscounted fair market value of the pledged
shares was approximately $2,180,297, based upon a market price of $6.75 per
common share. The guaranty secures the loan until it is paid or refinanced
without a guaranty. The Company would fund any obligation it incurs under the
terms of its guaranty from additional borrowing under its Revolver. There can be
no assurance that the Loan will be repaid or refinanced at January 31, 1999, on
terms that will not result in continuing the guaranty or in a material payment.
Mr. Seelbinder agreed to pay to the Company a guaranty fee each year that the
guaranty remains outstanding beginning on March 9, 1994, the date the Company
first issued its guaranty of the Loan. The amount of the guaranty fee is 1/4
percent of the outstanding principal amount of the guaranteed loan on the date
that the guaranty fee becomes due. Mr. Seelbinder has agreed to use at least
on-half of any incentive bonus paid to him by the Company to pay principal and
interest on the Loan beginning with any incentive bonus paid for fiscal year
1998. Mr. Seelbinder has also agreed to make payments on the Loan in amounts
sufficient to ensure that the Loan balance on January 31, 1999, does not exceed
90 percent of the Loan balance on January 31, 1998.
Because the value of the shares pledged to secure the Loan at October 15,
1998, and on the date of this filing was less than the amount required under the
terms of the Loan, the Bank has the right to require Mr. Seelbinder to provide
more collateral or to pay down the Loan. The Bank has indicated to Mr.
Seelbinder and to the Company that it will require a cash deposit in such amount
to satisfy the collateral shortfall as a result of the decreased price of the
Company's common stock. The Bank, the Company and Mr. Seelbinder have reached a
preliminary agreement concerning such deposit under which, Mr. Seelbinder will
pay $200,000 to the Bank, the Bank will extend the maturity of the Loan to
January 31, 2000, the Company will make a cash deposit of approximately
$1,400,000 in the Bank which will be revalued monthly and Mr. Seelbinder will
reimburse the Company for the amount by which the interest on the deposit is
less than the interest the Company pays for funds under its Term Loan and
Revolver. The Company may obtain some part of the funds necessary to make the
deposit from the Revolver. This use of the Company's funds will not materially
affect its working capital or its ability to implement its capital expenditure
plan or make improvements and betterments on its properties. Mr. Seelbinder has
also informed the Company that following the consummation of the Offer and the
repayment of a portion of the Loan, he intends to discuss with the Bank or other
financing sources the refinancing of the balance of the Loan. There can be no
assurance that such refinancing will occur or that, if the Loan is refinanced,
the guaranty will not remain outstanding or that the deposit will be returned to
the Company.
<PAGE> 12
YEAR 2000
The Year 2000 problem is the result of computer programs being written using
two digits rather than four to define the applicable year. The majority of the
Company's systems are purchased from outside vendors. The Company is currently
in the process of assessing whether it will be required to modify or replace
significant portions of its software so that its computer systems will properly
utilize dates beyond December 31, 1999. Those installed systems which are not
currently able to fully function in the Year 2000 either have new versions
available which are Year 2000 compliant, or the vendor has committed to a Year
2000 compliant release in sufficient time to allow installation and testing
prior to critical cutover dates. The Company is also in the process of
completing its inventory of computer information technology and non-information
technology hardware systems to assess Year 2000 compliance. In addition to the
Company's internal systems and hardware, the Company is preparing to assess the
Year 2000 readiness of its vendors. As a part of this assessment, the Company
will ask each major vendor to inform the Company of its (the vendor's) Year 2000
readiness and initiatives. To the extent that the Company's vendors do not
provide the Company with satisfactory evidence of their readiness for the Year
2000 issue, contingency plans will be developed.
The Company has developed a plan to address the possible exposures related to
the impact on its computer systems of the Year 2000 problem. The plan provides
for the conversion efforts to be completed on all critical systems by the end of
1999. The Company expects that the maximum cost which could be incurred in
conjunction with the testing and remediation of all hardware and software
systems and applications would be approximately $500,000 through completion in
fiscal year 1999, of which, approximately $10,000 has been incurred to date.
Such costs have been and will be funded by the Company's operating cash flows.
The cost of the Company's plan to address the Year 2000 issue and the
anticipated date on which the Company plans to complete the necessary Year 2000
conversion efforts are based on management's best estimates, which were derived
from numerous assumptions of future events, including the availability of
resources, vendor remediation plans, and other factors. As a result, there can
be no assurance that the Company, or other companies with whom the Company
conducts business, will successfully address the Year 2000 problem in a timely
manner, or at all, or that the Year 2000 problem will not have a material
adverse effect on the Company's business or operations.
NEW ACCOUNTING PRONOUNCEMENTS
Effective December 29, 1997, the Company adopted SFAS No. 130 "Reporting
Comprehensive Income," and No. 131 "Disclosure about Segments of an Enterprise
and Related Information." The adoption of these pronouncements did not have a
significant impact on the Company's consolidated financial position, results of
operations or cash flows.
In June 1998, the FASB issued SFAS No. 133, "Accounting for Derivative
Instruments and Hedging Activities" ("SFAS No. 133"). This statement establishes
accounting and reporting standards for derivative instruments, including certain
derivative instruments embedded in other contracts, (collectively referred to as
derivatives) and for hedging activities. It requires that an entity recognize
all derivatives as either assets or liabilities in the statement of financial
position and measure those instruments at fair value. If certain conditions are
met, a derivative may be specifically designated as (a) a hedge of the exposure
to changes in fair value of a recognized asset, (b) a hedge of the exposure to
variable cash flows of a forecasted transaction, or (c) a hedge of the foreign
currency exposure of a net investment in a foreign operation, an unrecognized
firm commitment, an available-for-sale security, or a
foreign-currency-denominated forecasted transaction. The accounting for the
changes in the fair value of a derivative (this is, gains and losses) depends on
the intended use of the derivative and the resulting designation. This statement
shall be effective for all fiscal quarters of all fiscal years beginning after
June 15, 1999. The Company has not determined the effect of the adoption of SFAS
No. 133 on the Company's results of operations or statement of financial
position.
<PAGE> 13
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Not Applicable
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS.
None.
ITEM 2. CHANGES IN SECURITIES AND USE OF PROCEEDS.
None.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
None.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
None.
ITEM 5. OTHER INFORMATION.
None.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.
(A) THE FOLLOWING EXHIBITS ARE FILES AS PART OF THIS REPORT.
3. ARTICLES OF INCORPORATION AND BY-LAWS.
Exhibit 3.1
Amended and Restated Articles of Incorporation of the Registrant (incorporated
by reference to exhibit 28.2 of Registrant's quarterly report on for 10-Q for
the fiscal quarter ended March 29, 1992; Commission File No. 0-16806).
Exhibit 3.2
Amended and Restated Code of Regulations of the Registrant (incorporated by
reference to exhibit 4.5 of the Registrant's quarterly report on for 10-Q for
the fiscal quarter ended April 1, 1990; Commission File No. 0-16806).
4. INSTRUMENTS DEFINING THE RIGHTS OF SECURITY HOLDERS, INCLUDING INDENTURES.
Exhibit 4.1
See Articles FOURTH, FIFTH and SIXTH of the Amended and Restated Articles of
Incorporation of the Registrant (see Exhibit 3.1 above).
Exhibit 4.2
See Articles One, Four, Seven and Eight of the Amended and Restated Code of
Regulations of the Registrant (see Exhibit 3.2 above).
<PAGE> 14
Exhibit 4.3
Rights Agreement dated as of February 1, 1990, between the Registrant and
National City Bank (incorporated by reference to Exhibit 1 of the Registrant's
Form 8-A filed with the Commission on February 9, 1990; Commission File No.
0-16806).
Exhibit 4.4
Amendment to Rights Agreement dated as of November 1, 1992, between the
Registrant and National City Bank (incorporated by reference to exhibit 4.4 of
Registrant's annual report on Form 10-K for the fiscal year ended January 3,
1993 (the "1992 Form 10-K"); Commission File No. 0-16806).
Exhibit 4.5
Letter dated October 29, 1992, from the Registrant to First Union National Bank
of North Carolina (incorporated by reference to Exhibit 4.5 to the 1992 form
10-K).
Exhibit 4.6
Letter dated October 29, 1992, from National City Bank to the Registrant
(incorporated by reference to Exhibit 4.6 to the 1992 form 10-K).
Exhibit 4.7
See sections 7.4 of the Amended and Restated Loan Agreement dated December 22,
1995 between the Registrant and First Union National Bank of Tennessee
(incorporated by reference to Exhibit 10.4 of the Registrant's annual report on
From 10-K for the fiscal year ended December 31, 1995; Commission File No.
0-16806).
10. MATERIAL CONTRACTS.
Exhibit 10.20
Loan Agreement dated September 24, 1998, between the Registrant and First Union
National Bank and NationsBank of Tennessee, N.A., both national banking
associations. Page 19 in the manually signed original.
Exhibit 10.21
Loan agreement between the Registrant and The CIT Group/Equipment Financing,
Inc. Page 88 in the manually signed original.
Exhibit 10.22
Letter dated September 17, 1998 from G. Arthur Seelbinder to the Registrant
(incorporated by reference to Exhibit (c)(10) to Amendment No. 3 to the
Registrant's Schedule 13E-4 filed on September 18, 1998; Commission File No.
0-16806).
27. FINANCIAL DATA SCHEDULES.
Exhibit 27.1
Financial Data Schedule (submitted electronically for SEC information only).
(B) REPORTS ON FROM 8-K
No report on Form 8-K was filed by the Registrant during the fiscal quarter
ended September 27, 1998.
<PAGE> 15
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
COOKER RESTAURANT CORPORATION
(The "Registrant")
Date: November 13, 1998
By: /s/ G. Arthur Seelbinder
-----------------------------------------
G. Arthur Seelbinder
Chairman of the Board of Directors, Chief
Executive Officer, and Director
(principal executive officer and duly
authorized officer)
By: /s/ Mark W. Mikosz
-----------------------------------------
Mark W. Mikosz
Vice President - Chief Financial Officer
(principal financial and accounting
officer)
<PAGE> 16
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
------------------------
COOKER RESTAURANT CORPORATION
------------------------
FORM 10-Q QUARTERLY REPORT
FOR THE FISCAL QUARTER ENDED:
SEPTEMBER 27, 1998
-------------------------
EXHIBITS
-------------------------
- --------------------------------------------------------------------------------
<PAGE> 17
Exhibit 3.1
Amended and Restated Articles of Incorporation of the Registrant (incorporated
by reference to exhibit 28.2 of Registrant's quarterly report on for 10-Q for
the fiscal quarter ended March 29, 1992; Commission File No. 0-16806).
Exhibit 3.2
Amended and Restated Code of Regulations of the Registrant (incorporated by
reference to exhibit 4.5 of the Registrant's quarterly report on for 10-Q for
the fiscal quarter ended April 1, 1990; Commission File No. 0-16806).
Exhibit 4.1
See Articles Fourth, Fifth and Sixth of the Amended and Restated Articles of
Incorporation of the Registrant (see Exhibit 3.1 above).
Exhibit 4.2
See Articles One, Four, Seven and Eight of the Amended and Restated Code of
Regulations of the Registrant (see Exhibit 3.2 above).
Exhibit 4.3
Rights Agreement dated as of February 1, 1990, between the Registrant and
National City Bank (incorporated by reference to Exhibit 1 of the Registrant's
Form 8-A filed with the Commission on February 9, 1990; Commission File No.
0-16806).
Exhibit 4.4
Amendment to Rights Agreement dated as of November 1, 1992, between the
Registrant and National City Bank (incorporated by reference to exhibit 4.4 of
Registrant's annual report on Form 10-K for the fiscal year ended January 3,
1993 (the "1992 Form 10-K"); Commission File No. 0-16806).
Exhibit 4.5
Letter dated October 29, 1992, from the Registrant to First Union National Bank
of North Carolina (incorporated by reference to Exhibit 4.5 to the 1992 form
10-K).
Exhibit 4.6
Letter dated October 29, 1992, from National City Bank to the Registrant
(incorporated by reference to Exhibit 4.6 to the 1992 form 10-K).
Exhibit 4.7
See sections 7.4 of the Amended and Restated Loan Agreement dated December 22,
1995 between the Registrant and First Union National Bank of Tennessee
(incorporated by reference to Exhibit 10.4 of the Registrant's annual report on
From 10-K for the fiscal year ended December 31, 1995; Commission File No.
0-16806).
Exhibit 4.8
Indenture dated as of October 28, 1992, between the Registrant and First Union
National Bank of North Carolina, as Trustee (incorporated by reference to
Exhibit 2.5 of the Registrant's Form 8-A filed with the Commission on November
10, 1992; Commission File No. 0-16806).
<PAGE> 18
Exhibit 10.20
Loan Agreement dated September 24, 1998, between the Registrant and First Union
National Bank and NationsBank of Tennessee, N.A., both national banking
associations.
Exhibit 10.21
Loan Agreement dated September 24, 1998, between the Registrant and The CIT
Group/Equipment Financing, Inc.
Exhibit 10.22
Letter dated September 17, 1998 from G. Arthur Seelbinder to the Registrant
(incorporated by reference to Exhibit (c)(10) to Amendment No. 3 to the
Registrant's Schedule 13E-4 filed on September 18, 1998; Commission File No.
0-16806).
Exhibit 27.1
Financial Data Schedule (submitted electronically for SEC information only).
<PAGE> 1
Exhibit 10.20
LOAN AGREEMENT
This Loan Agreement ("Agreement") entered into the day of September,
1998, by and among COOKER RESTAURANT CORPORATION, an Ohio corporation
("Borrower"), CGR MANAGEMENT CORPORATION, a Florida corporation, FLORIDA COOKER,
LP, INC., a Florida corporation, and SOUTHERN COOKER LIMITED PARTNERSHIP, an
Ohio limited partnership,(collectively the "Co-Obligors" and individually a
"Co-Obligor"), jointly and severally, and NATIONSBANK OF TENNESSEE, N.A., a
national banking association ("NationsBank") and FIRST UNION NATIONAL BANK, a
national banking association ("First Union") (NationsBank and First Union being
individually referred to as a "Lender" and collectively referred to as the
"Lenders") and NATIONSBANK OF TENNESSEE, N.A. as administrative agent for the
Lenders (in such capacity the "Agent").
W I T N E S S E T H:
WHEREAS, the Borrower and Co-Obligors have requested that the Lenders
provide a Sixty Two Million Five Hundred Thousand and No/100 Dollars
($62,500,000.00) credit facility to the Borrower and Co-Obligors; and
WHEREAS, the Lenders have agreed to make the requested credit facility
available to the Borrower and Co-Obligors on the terms and conditions
hereinafter set forth; and
NOW, THEREFORE, as an inducement to cause Lenders to extend credit to
Borrower and Co-Obligors, and for other valuable consideration, the receipt and
sufficiency of which are acknowledged, it is agreed as follows:
1. DEFINITIONS.
(a) "25 Properties" means those 25 restaurant properties owned
in fee simple by Borrower as described on EXHIBIT A.
(b) "11 Properties" means those 11 restaurant properties owned
in fee simple by Borrower as described on EXHIBIT B.
(c) "Affiliate" means, with respect to any Person, any other
Person directly or indirectly controlling (including but not limited to
all directors and officers of such Person), controlled by or under
direct or indirect common control with such Person. A Person shall be
deemed to control a corporation if such Person possesses, directly or
indirectly, the power (i) to vote 10% or more of the securities having
ordinary voting power for the election of directors of such corporation
or (ii) to direct or cause direction of the management and
1
<PAGE> 2
policies of such corporation, whether through the ownership of voting
securities, by contract or otherwise.
(d) "Agent" means NationsBank of Tennessee, N.A., or any
successor administrative agent appointed pursuant to Section 47.
(e) "Applicable Margin" means for any fiscal quarter the
applicable rate per annum in excess of the LIBOR Rate set forth in the
table below:
Ratio of Funded
Debt to EBITDA Applicable Margin
-------------- -----------------
greater than or equal to 4.0 to 1.0 2.25%
greater than or equal to 3.0 to 1.0 but
less than 4.0 to 1.0 2.0%
greater than or equal to 2.5 to 1.0 but
less than 3.0 to 1.0 1.50%
greater than or equal to 2.0 to 1.0 but
less than 2.5 to 1.0 1.25%
less than 2.0 to 1.0 1.0%
The Ratio of Funded Debt to EBITDA shall be computed for Borrower and
Co-Obligors on a rolling four quarter basis and as determined by GAAP on a
consolidated basis. The Borrower is required to give Lenders a compliance
certificate within 45 days of the end of each fiscal quarter. The Applicable
Margin will be computed based on such compliance certificate and will become
effective as of the first day of the month following the month in which the
compliance certificate was due. The Applicable Margin will then apply for that
three-month period.
(f) "Bankruptcy Code" means the Bankruptcy Code in Title 11 of
the United States Code, as amended, modified, succeeded or replaced
from time to time.
(g) "Base Rate" means the LIBOR Rate (as defined in Section 6)
for one month periods (a "LIBOR Period") plus the Applicable Margin.
(h) "Business Day" means any day other than a Saturday, a
Sunday, or legal holiday or a day on which banking institutions are
authorized or required by law or other governmental action to close in
Nashville, Tennessee or in any other city in the United States in which
is located the principal place of business of a Lender; provided that
such day is also a day on which dealings between banks are carried on
in U.S. dollar deposits in the London
<PAGE> 3
interbank market. Should any payment of principal or interest be due on
a day that is not a Business Day, then the payment shall be due on the
first Business Day thereafter.
(i) "Capital Expenditures" means all expenditures of the
Borrower and Co-Obligors which, in accordance with GAAP, would be
classified as capital expenditures, including, without limitation,
Capital Leases.
(j) "Capital Lease" means, as applied to any Person, any lease
of any property (whether real, personal or mixed) by that Person as
lessee which, in accordance with GAAP, is or should be accounted for as
a capital lease on the balance sheet of that Person.
(k) "Change of Control" means the change of 1/3 or more of the
Continuing Directors of the Borrower within any twelve-month period;
the change of 1/2 or more of the Continuing Directors of the Borrower
within any twenty-four month-period; or the acquisition by any person
or "group" (as such term is used in Section 13 (b) (3) of the
Securities Exchange Act of 1934, as amended) of a direct or indirect
majority (more than 50%) interest in the voting power of the voting
stock of the Borrower by way of merger, consolidation or otherwise. A
"Continuing Director" shall mean any member of the board of directors
of the Company who (i) was a member of such board of directors on the
date of this Loan Agreement or (ii) was nominated for election or
elected to such board of directors with the affirmative vote of a
majority of the Continuing Directors who are members of such board at
that time of such nomination or election whether as a result of the
addition of new members to replace Continuing Directors who die, resign
or retire, an increase in the number of directors or otherwise.
(l) "Closing Date" means the date hereof.
(m) "Code" means the Internal Revenue Code of 1986, as
amended, modified, succeeded or replaced from time to time.
(n) "Collateral Documents" means the mortgages, deeds of
trust, security agreements and such other documents executed and
delivered in connection with the attachment and perfection of the
Lenders' security interests and liens in the assets of the Borrower and
Co-Obligors, including, without limitation, UCC financing statements;
provided the only personal property in which Lenders will have a
security interest shall be the owner's title insurance policies on the
Properties.
(o) "Collateral" means all collateral referred to in and
covered by the Collateral Documents.
(p) "Commitment Fees" means the fees payable to the Lenders
pursuant to
3
<PAGE> 4
Section 7.
(q) "Commitments" means the Revolving Committed Amount and
Term Loan Committed Amount.
(r) "Current Assets" will have the meaning given in accordance
with Generally Accepted Accounting Principles.
(s) "Current Liabilities" will have the meaning given in
accordance with Generally Accepted Accounting Principles.
(t) "Default" has the meaning specified in Section 39.
(u) "Dollars" and "$" means dollars in lawful currency of the
United States of America.
(v) "EBITDA" means, for any period, with respect to the
Borrower and Co-Obligors on a consolidated basis, the sum of (a) Net
Income for such period (excluding the effect of any extraordinary or
non-recurring gains or losses outside of the ordinary course of
business) plus (b) an amount which, in the determination of Net Income
for such period has been deducted for (i) Interest Expense for such
period; (ii) total federal, state, foreign or other income taxes for
such period; and (iii) all depreciation and amortization for such
period, all as determined in accordance with GAAP.
(w) "Effective Date" means the date on which the conditions
set forth in Section 7 shall have been fulfilled (or waived in the sole
discretion of the Lenders) and on which the initial Loans shall have
been made.
(x) "Environmental Laws" means the Environmental Protection
Act, the Resource Conservation and Recovery Act of 1976, the
Comprehensive Environmental Response, Compensation and Liability Act of
1980, the Hazardous Materials Transportation Act and any other federal,
state or municipal law, rule or regulation relating to air emissions,
water discharge, noise emissions, solid or liquid waste disposal,
hazardous or toxic waste or materials, or other environmental or health
matters.
(y) "Escrow Mortgages" means mortgages and/or deeds of trust
on the 11 Properties.
(z) "ERISA" means the Employee Retirement Income Security Act
of 1974, as amended, and any successor statute thereto, as interpreted
by the rules and regulations thereunder, all as the same may be in
effect from time to time. References to sections of
4
<PAGE> 5
ERISA shall be construed also to refer to any successor sections.
(aa) "ERISA Affiliates" means an entity, whether or not
incorporated, which is under common control with any Borrower and
Co-Obligors within the meaning of Section 4001(a)(14) or ERISA, or is a
member of a group which includes Borrower and Co-Obligors and which is
treated as a single employer under Sections 414(b), (c), (m), or (o) of
the Code.
(bb) "ERISA Plan" means any employee benefit plan (as defined
in Section 3(3) of ERISA) which is covered by ERISA and with respect to
which Borrower or any Co-Obligor or any ERISA Affiliate is (or, if such
plan were terminated at such time, would under Section 4069 of ERISA be
deemed to be) an "employer" within the meaning of Section 3(5) of
ERISA.
(cc) "Existing First Union Debt" means that certain Promissory
Note dated August 26, 1991, as amended from time to time from Borrower
to First Union in the principal amount of $33,000,000.00.
(dd) "Fee Letter" means that certain letter between
NationsBank and Borrower dated the 24 day of September, 1998.
(ee) "First Union Mortgages" means those mortgages originally
granted to First Union on the Properties described on Exhibit K.
(ff) "Funded Debt" means, without duplication, the sum of (a)
all indebtedness of the Borrower and Co-Obligors for borrowed money,
(b) all purchase money indebtedness of the Borrower and Co-Obligors,
(c) the principal portion of all obligations of the Borrower and
Co-Obligors under Capital Leases, (d) commercial letters of credit and
the maximum amount of all performance and standby letters of credit
issued by bankers' acceptance facilities created for the account of the
Borrower or Co-Obligors to the extent of all unreimbursed draws
thereunder, (e) all guaranty obligations of the Borrower and
Co-Obligors with respect to Funded Debt of another person, (f) all
Funded Debt of another entity secured by a Lien on any property of the
Borrower or Co-Obligors whether or not such Funded Debt has been
assumed by a Borrower or Co-Obligors, (g) all Funded Debt of any
partnership or unincorporated joint venture to the extent the Borrower
or Co-Obligors are legally obligated or have a reasonable expectation
of being liable with respect thereto, net of any assets of such
partnership or joint venture; and (h) the principal balance outstanding
under any synthetic lease, tax retention operating lease, off-balance
sheet loan or similar off-balance sheet financing product pursuant to
which a Borrower or Co-Obligors is the obligor where such transaction
is considered borrowed money indebtedness for tax purposes but is
classified as an operating lease in accordance with GAAP.
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<PAGE> 6
(gg) "Generally Accepted Accounting Principles" or "GAAP"
means generally accepted accounting principles set forth in opinions
and pronouncements of the Accounting Principles Board of the American
Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board,
consistently applied and maintained throughout the period indicated and
consistent with the prior financial practice of Borrowers and any
predecessors.
(hh) "Governmental Authority" means any federal, state, local,
provincial or foreign court or governmental agency, authority,
instrumentality or regulatory body.
(ii) "Hazardous Materials" means those substances included
from time to time within the definition of hazardous substances,
hazardous materials, toxic substances, or solid waste under the
Comprehensive Environmental Response, Compensation and Liability Act of
1980 as amended, 42 U.S.C. ss. 9601 et seq.; the Resource Conversation
and Recovery Act of 1976, 42 U.S.C. ss. 1801 et seq., and in the
regulations promulgated pursuant to such acts and laws; and such other
substances that are or become regulated under any applicable local,
state or federal law or regulation addressing environmental hazards.
(jj) "Initial Mortgages" means deeds of trust and/or mortgages
on the 25 Properties. To the extent that one or more properties that
are included in the 25 Properties are subject to a First Union
Mortgage, such First Union Mortgage shall be amended and restated on
the Closing Date.
(kk) "Interest Expense" means, for any period, with respect to
the Borrower and Co-Obligors on a consolidated basis, all interest
expense, including the interest component under Capital Leases, as
determined in accordance with GAAP.
(ll) "Interest Income" means, for any period, with respect to
the Borrower and Co-Obligors on a consolidated basis, all interest
income as determined in accordance with GAAP.
(mm) "Lien" means any mortgage, pledge, hypothecation,
assignment, deposit arrangement, security interest, encumbrance, lien
(statutory or otherwise), preference, priority or charge of any kind
(including, without limitation, any agreement to give any of the
foregoing, any conditional sale or other title retention agreement, any
financing or similar statement or notice filed under the Uniform
Commercial Code as adopted and in effect in the relevant jurisdiction
or other similar recording or notice statute, and any lease in the
nature thereof).
(nn) "Loan" or "Loans" means the Revolving Loan and/or the
Term Loans (or a portion of any Revolving Loan or the Term Loans),
individually or collectively, as
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<PAGE> 7
appropriate and, after the Second Closing means the Renewal Revolving
Loans and/or the Renewal Term Loans or a portion of any Renewal
Revolving Loan or the Renewal Term Loans individually or collectively
as appropriate.
(oo) "Loan Documents" means this Agreement, the Notes, the
Collateral Documents and all other related agreements and/or documents
issued or delivered hereunder or thereunder or pursuant hereto or
thereto.
(pp) "Material Adverse Effect" means a material adverse
effect, after taking in account applicable insurance, if any (to the
extent the provider thereof has the financial ability to support its
obligation with respect thereto and is not disputing same), on (a) the
operations, financial condition, business or prospects of the Borrower
and Co-Obligors taken as a whole, (b) the ability of Borrower and
Co-Obligors to perform their respective obligations under this
Agreement or any of the other Loan Documents, or (c) the validity or
enforceability of this Agreement, any of the other Loan Documents, or
the rights or remedies of the Lenders hereunder or thereunder taken as
a whole.
(qq) "Net Income" means, for any period, the net income after
taxes for such period of the Borrower and Co-Obligors on a consolidated
basis, as determined in accordance with GAAP.
(rr) "Note" or "Notes" means the Revolving Loan Notes and/or
the Term Loan Notes, individually or collectively, as appropriate and,
after the Second Closing, the Renewal Revolving Loan Notes and/or the
Renewal Term Loan Notes individually, or collectively as appropriate.
(ss) "Operating Lease" means, as applied to any Person, any
lease (including, without limitation, leases which may be terminated by
the lessee at any time) of any property (whether real, personal or
mixed) which is not a Capital Lease other than any such lease in which
that Person is the lessor.
(tt) "Participation Interest" means the extension of credit by
a Lender by way of a purchase of a participation in any Loans as
provided in Section 46.
(uu) "Permitted Investments" means (i) commercial paper and
variable or fixed rate notes issued by, or guaranteed by, any domestic
corporation rated A-1 (or the equivalent thereof) or better by S&P or
P-1 (or the equivalent thereof) or better by Moody's and maturing
within 30 days of the date of acquisition, (ii) dollar denominated time
deposits and certificates of deposits of the Lenders with a maturity
date of not more than 30 days after the creation thereof, and (iii) tax
exempt securities either (A) carrying a rating of MIG 1 or better
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<PAGE> 8
or (B) backed by an acceptable irrevocable letter of credit issued by a
bank with a short-term commercial paper rating of A-1 (or the
equivalent thereof) or better by S&P or P-1 (or the equivalent thereof
or better by Moody's), in each case maturing within 30 days of the date
of acquisition.
(vv) "Permitted Liens" means (a) Liens securing obligations of
Borrower or Co-Obligors to Lenders hereunder, (b) Liens for taxes not
yet due or Liens for taxes being contested in good faith by appropriate
proceedings for which adequate reserves determined in accordance with
GAAP have been established (and as to which the property subject to any
such Lien is not yet subject to foreclosures, sale or loss on account
thereof), (c) Liens in respect of property imposed by law arising in
the ordinary course of business such as materialmen's, mechanics',
warehousemen's, carrier's, landlords' and other nonconsensual statutory
Liens which are not due and payable or, if due and payable, are being
contested in good faith by appropriate proceedings for which adequate
reserves determined in accordance with GAAP have been established (and
as to which the property subject to any such Lien is not yet subject to
foreclosure, sale or loss on account thereof), (d) pledges or deposits
made in the ordinary course of business to secure payment of worker's
compensation insurance, unemployment insurance, pensions or social
security programs, (e) Liens arising from good faith deposits in
connection with or to secure performance of tenders, bids, leases,
government contracts, performance and return-of-money bonds and other
similar obligations incurred in the ordinary course of business (other
than obligations in respect of the payment of borrowed money), (f)
Liens arising from good faith deposits in connection with or to secure
performance of statutory obligations and surety and appeal bonds, (g)
easements, rights-of-way, restrictions (including zoning restrictions),
minor defects or irregularities in title and other similar charges or
encumbrances not, in any material respect, impairing the use of the
encumbered property for its intended purposes, (h) judgment Liens that
would not constitute an Event of Default, (i) Liens in connection with
indebtedness allowed under Section 35, (j) Liens arising by virtue of
any statutory or common law provision relating to banker's liens,
rights of setoff or similar rights as to deposit accounts or other
funds maintained with a creditor depository institution, and (k) Liens
existing on the date hereof and identified on EXHIBIT C; provided that
no such Liens shall extend to any property other than the property
subject thereto on the Closing Date; provided, however, no lien
described in (i) shall attach to the Collateral.
(ww) "Person" means any individual partnership, joint venture,
firm, corporation, limited liability company, association, trust or
other enterprise (whether or not incorporated), or any Governmental
Authority.
(xx) "Properties" means the 25 Properties and the 11
Properties.
(yy) "Renewal Amount" means the lesser of seventy percent
(70%) of the
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<PAGE> 9
aggregate appraised value of the Acceptable Properties determined under
Section 5(c)(i) or $62,500,000.00.
(zz) "Renewal Revolving Committed Amount" means, after the
Second Closing, up to Ten Million and 00/100 dollars ($10,000,000.00)
of the Revolving Loan that Borrower and Co-Obligors have elected to
renew as Renewal Revolving Loan.
(aaa) "Renewal Revolving Loan" means, after the Second
Closing, the Renewal Revolving Loans made to the Borrower pursuant to
Section 5.
(bbb) "Renewal Term Loan" means, after the Second Closing, the
Renewal Term Loan made to the Borrower pursuant to Section 5.
(ccc) "Renewal Term Loan Committed Amount" means, after the
Second Closing, an amount equal to the Renewal Amount less the amount
of the Renewal Revolving Loan.
(ddd) "Required Lenders" means Lenders whose aggregate Credit
Exposure (as hereinafter defined) constitutes at least 66% of the
Credit Exposure of all Lenders at such time; provided, however, that if
any Lender shall be a Defaulting Lender at such time then there shall
be excluded from the determination of Required Lenders the aggregate
principal amount of Credit Exposure of such Lender at such time. For
purposes of the preceding sentence, the term "Credit Exposure" as
applied to each Lender shall mean (a) at any time prior to the
termination of the Commitments, the sum of (i) the Revolving Loan or
Renewal Revolving Loan outstanding of such Lender, plus (ii) the Term
Loan or Renewal Term Loan outstanding of such Lender at such time, and
(b) at any time after the termination of the Commitments, the principal
balance of the outstanding Loans of such Lender.
(eee) "Revolving Committed Amount" means $10,000,000.00 or
such lesser amount as the Revolving Committed Amount may be reduced.
(fff) "Revolving Loan Commitment Percentage" means, for each
Lender, the following percentage: NationsBank One Hundred Percent
(100%) and zero percent (0%) for the other Lenders as such percentage
may be modified in connection with any assignment made in accordance
with the provisions of Section 52.
(ggg) "Revolving Loan Maturity Date" means March 24, 2004,
subject to the provisions of Section 5.
(hhh) "Revolving Loans" means the Revolving Loans made to the
Borrower pursuant to Section 2.
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<PAGE> 10
(iii) "Revolving Note" or "Revolving Notes" means the
promissory note of the Borrower in favor of NationsBank evidencing the
Revolving Loans provided pursuant to Section 2, individually or
collectively, as appropriate, as such promissory notes may be amended,
modified, supplemented, extended, renewed or replaced from time to time
and as evidenced in the form of EXHIBIT D.
(jjj) "Second Closing" means the time, not later than March
24, 1999, when the conditions contained in Section 5 are satisfied.
(kkk) "Subordinated Debt" means those certain 6.75%
Convertible Subordinated Debentures due 2002 and having a principal
balance of at least $13,000,000.00.
(lll) "Tangible Net Worth" will mean the excess of total
assets (excluding intangible assets) over total liabilities (exclusive
of capital stock and surplus), all determined in accordance with
Generally Accepted Accounting Principles consistently applied.
(mmm) "Tender Offer" means Borrower's public offer to purchase
for cash up to 4,000,000 shares of its common stock traded on the New
York Stock Exchange at a per share price of not less than $10.50 or
more than $12.00 with the final per share price determined by the
process known as a "Dutch Auction". In its Tender Offer, Borrower has
reserved the right to purchase more than 4,000,000 shares if more than
this number are tendered.
(nnn) "Term Loan Commitment Percentage" means, for each
Lender, the following percentage: NationsBank 57.14% and First Union
42.86%, as such percentage may be modified in connection with any
assignment made in accordance with the provisions of Section 52;
provided, however, that in no event shall the amount of the commitment
or Loans funded by First Union exceed $22,500,000.
(ooo) "Term Loan Committed Amount" means $52,500,000.00.
(ppp) "Term Loan Maturity Date" means March 24, 2004, subject
to the provisions of Section 5.
(qqq) "Term Loan Note" or "Term Loan Notes" means the
promissory notes of the Borrower in favor of each of the Lenders
evidencing the Term Loans provided pursuant to Section 3, individually
or collectively, as appropriate, as such promissory notes may be
amended, modified, supplemented, extended, renewed or replaced from
time to time as evidenced in the form of EXHIBIT E.
(rrr) "Term Loans" means the Term Loans made to the Borrower
pursuant to
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<PAGE> 11
Section 3.
(sss) "Tranche A" means that portion of the Term Loan
Committed Amount and Renewal Term Loan Committed Amount held by First
Union.
(ttt) "Tranche B" means that portion of the Term Loan
Committed Amount and Renewal Term Loan Committed Amount held by other
Lenders.
2. REVOLVING LOAN COMMITMENT. Concurrently with the execution of this
Agreement and subject to the terms and conditions set forth herein, NationsBank
agrees to make a revolving loan (each a "Revolving Loan" and collectively the
"Revolving Loans") to the Borrower and Co-Obligors at any time and from time to
time during the period from and including the date hereof to but not including
the Revolving Loan Maturity Date (or such earlier date if the Revolving
Committed Amount has been terminated as provided herein); provided however that
the aggregate amount of Revolving Loans outstanding shall not exceed Ten Million
and No/100 Dollars ($10,000,000.00). Subject to the terms of this Agreement, the
Borrower and Co-Obligors may borrow, repay and reborrow Revolving Loans.
(a) INTEREST RATE. Prior to maturity, whether by acceleration
or otherwise, the principal amount outstanding under the Revolving
Loans shall bear interest at the Base Rate; provided, however, at
Borrower's option, the Base Rate may be computed using NationsBank's
floating daily LIBOR rate.
(b) METHOD OF BORROWING FOR REVOLVING LOANS. By no later than
11:00 a.m. Eastern Standard or Daylight Time, as the case may be, on
the same Business Day, the Borrower shall submit a written Notice of
Borrowing in the form of Exhibit F to NationsBank setting forth the
amount requested.
(c) FUNDING OF REVOLVING LOANS. Upon receipt of a Notice of
Borrowing, NationsBank shall make the requested Revolving Loan
available by crediting the account of the Borrower on the books of such
office of NationsBank.
(d) PAYMENTS. Payment of all obligations arising under the
Revolving Loan shall be made as follows:
(i) INTEREST AND FEES. Interest on the outstanding
principal balance under the Revolving Loans shall be paid in
arrears on the 1st day of each month beginning on October 1,
1998.
(ii) VOLUNTARY PREPAYMENT. Voluntary prepayments of
principal or accrued interest may be made, in whole or in
part, at any time without penalty,
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<PAGE> 12
except, in the case of a LIBOR Rate borrowing, a payment prior
to the end of the LIBOR Period will require Borrower and
Co-Obligors to pay Lenders any breakage costs associated with
such prepayment.
(iii) MANDATORY PREPAYMENT. Borrower and Co-Obligors
must immediately prepay any amount by which the principal
balance of the Revolving Loans exceeds the Revolving Committed
Amount.
(iv) ALL AMOUNTS DUE. All remaining principal,
interest and expenses outstanding under the Revolving Loans
shall become due March 24, 2004, subject to the provisions of
Section 5.
(v) NON-USE FEE. Borrower and Co-Obligors shall pay
NationsBank a non-use fee of one-quarter percent per annum on
the averaged unused portion of the Revolving Loan or Renewal
Revolving Loan payable quarterly in arrears.
TERM LOAN COMMITMENT. Subject to the terms and conditions set forth
herein, each Lender severally agrees, on the Effective Date, to make a term loan
(individually a "Term Loan" and collectively, the "Term Loans") to the Borrower,
in Dollars, in an amount equal to such Lender's Term Loan Commitment Percentage
times the Term Loan Committed Amount; provided that the aggregate amount of such
Term Loans made on the Effective Date shall not exceed the Term Loan Committed
Amount. Once repaid, Term Loans cannot be reborrowed.
(a) FUNDING OF TERM LOANS. On the Effective Date, each
applicable Lender will make its Term Loan Commitment Percentage of the
Term Loan Committed Amount available to the Agent by deposit, in
Dollars and in immediately available funds, at the offices of the Agent
at its principal office in Nashville, Tennessee or at such other
address as the Agent may designate in writing; provided, that First
Union's portion of the Term Loan shall be funded by renewing and
restating a portion of the Existing First Union Debt. The amount of the
Term Loans will then be made available to the Borrower by the Agent by
crediting the account of the Borrower on the books of such office of
the Agent, to the extent the amount of such Term Loans are made
available to the Agent.
(b) INTEREST. Prior to maturity, whether by acceleration or
otherwise, the principal amount outstanding under the Term Loans shall
bear interest at the Base Rate.
(c) AMORTIZATION. Interest on the outstanding principal
balance of the term loan shall be paid in arrears on the first day of
each month beginning on October 1, 1998. Principal payments shall be
made in accordance with the provisions of Section 5.
(d) VOLUNTARY PREPAYMENTS. Voluntary prepayments of principal,
including
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<PAGE> 13
accrued interest, may be made, in whole or in part, at any time without
penalty, except, in the case of a LIBOR Rate borrowing, a payment prior
to the end of the LIBOR Period will require Borrower and Co-Obligors to
pay Lenders any breakage costs associated with such prepayment. Any
prepayments will be allocated ratably among the Lenders based upon the
then outstanding principal balances of their respective Term Notes;
provided, however, that a Lender may consent to receive less than its
pro rata portion in which case the other Lender may receive more than
its pro rata portion. Any prepayments will be applied in inverse order
of maturity.
(e) ALL AMOUNTS DUE. All remaining principal, interest and
expenses outstanding under the Term Loan shall become due on March 24,
2004, subject to the provisions of Section 5.
NOTES.
(a) REVOLVING LOAN NOTES. The Revolving Loans made by
NationsBank shall be evidenced by a duly executed promissory note of
the Borrower and Co-Obligors to NationsBank in the face amount of the
Revolving Committed Amount in substantially the form of EXHIBIT D.
(b) TERM LOAN NOTES. The Term Loan made by each Lender shall
be evidenced by a duly executed promissory note of the Borrower and
Co-Obligors to each applicable Lender in the face amount of $30,000,000
in the case of NationsBank and $22,500,000 in the case of First Union,
in substantially the form of EXHIBIT E.
(c) RENEWAL REVOLVING LOAN NOTES. The Renewal Revolving Loans
made by NationsBank shall be evidenced by a duly executed promissory
note of the Borrower and Co-Obligors to NationsBank in substantially
the form of EXHIBIT G.
(d) RENEWAL TERM LOAN NOTES. The Renewal Term Loan made by
each Lender shall be evidenced by a duly executed promissory note of
the Borrower and Co-Obligors to each applicable Lender in substantially
the form of EXHIBIT H.
MANDATORY PREPAYMENT. The Loans are intended to provide a
credit facility to Borrower and Co-Obligors for the purpose of funding
the Tender Offer and for working capital.
(a) ESCROW MORTGAGES. Within thirty (30) days following the
Closing Date, Borrower and Co-Obligors shall deliver to Lenders the
Escrow Mortgages. The Escrow Mortgages shall be in form and content
satisfactory to Lenders. Lenders will hold the Escrow Mortgages in
escrow pending the first to occur of the Second Closing or a Default.
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(b) DESIGNATION OF PROPERTIES. On or before ninety (90) days
following the Closing Date, Borrower shall designate to Lenders which
Properties will be the subject of financing under this Agreement
subject to satisfaction of the requirements set forth in subparagraph
(c) below and which of the Properties will be refinanced by one or more
other lenders. This designation shall be in writing and, unless
consented to by Lenders, shall be an irrevocable election by Borrower
and Co-Obligors.
(c) PERMANENT FINANCING AND MANDATORY PRINCIPAL REDUCTION. Prior
to the Second Closing of the portion of the Properties that have been
designated by Borrower to continue to finance under this Agreement, the
Required Lenders shall determine which of such Properties are
"Acceptable Properties". If Borrower and Co-Obligors are not then in
Default under this Agreement and if no events have occurred which, but
for the passage of time would constitute a Default under this
Agreement, then the portion of the Loans equal to the Renewal Amount
can be converted into a Renewal Term Loan and/or a Renewal Revolving
Loan on the following conditions.
(i) For purposes of this subsection, "Acceptable Properties"
shall mean those Properties which the Required Lenders
determine meet the following criteria: Lenders have a recorded
first mortgage and/or deed of trust in form satisfactory to
Lenders; Lenders have received a mortgagee's title insurance
policy insuring the priority of such mortgages issued by a
title insurance company acceptable to Lenders containing only
such restrictions as are acceptable to Lenders; Lenders have
received a current "as-built" survey prepared by a surveyor
acceptable to Lenders showing no encroachments or restrictions
that would interfere with Borrower and Co-Obligors use of the
Properties; Lenders have received a current appraisal prepared
by an appraiser engaged by Lenders which appraisal complies in
all respects with FIRREA and other regulatory requirements;
and Lenders have received a current environmental survey
concerning the Properties prepared by an environmental
assessment firm reasonably acceptable to the Required Lenders
and an Environmental Indemnity Agreement with respect to the
Properties in form and content satisfactory to Lenders.
Borrower and Co-Obligors shall pay all costs associated with
obtaining the foregoing for any Properties whether or not the
Properties ultimately become Acceptable Properties. The amount
of the title insurance policy shall be the Renewal Amount.
(ii) The Borrower and Co-Obligors shall pay down the principal
balance of the Loans (including accrued interest) to the
Renewal Amount on or before March 24, 1999. All payments will
be first applied to the balance outstanding under the Term
Notes.
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<PAGE> 15
(iii) Borrower and Co-Obligors shall determine whether the
Renewal Amount shall be solely in the form of Renewal Term
Loans or Renewal Term Loans and Renewal Revolving Loans. The
Borrower may elect to have up to Ten Million and 00/100
Dollars ($10,000,000.00) of the Renewal Amount in the form of
Renewal Revolving Loans. In such case, NationsBank will remain
the Lender for the amount of the Renewal Revolving Loan and
the Renewal Revolving Committed Amount will be adjusted to the
amount selected by Borrower. The amount of the Renewal Term
Loan will be the difference between the Renewal Amount and the
Renewal Revolving Committed Amount. The amount of the Renewal
Term Loan will be allocated between NationsBank and First
Union in the same ratio as their Term Loan Commitment
Percentage.
(iv) On the Second Closing, the Borrower and Co-Obligors shall
execute Renewal Revolving Notes and Renewal Term Notes in the
form of EXHIBITS G and H and deliver them to the Lenders.
Immediately following the Second Closing, provided that the
Borrower is not in Default at the time of the Second Closing,
the Lenders shall release any mortgages or deeds of trust,
including the Escrow Mortgages, held by them on Properties
that are not Acceptable Properties.
(v) Borrower may provide additional and/or substitute
properties acceptable to Lenders which will also be considered
"Acceptable Properties" if they meet the foregoing criteria.
Upon a sale, casualty loss or condemnation affecting an
Acceptable Property and so long as Borrower is not in default,
Borrower may propose to substitute a property of equal or
greater value (as determined by the appraisal utilized by
Lenders at the Second Closing) to the affected Acceptable
Property and, if approved by the Required Lenders and if the
proposed property meets all the criteria as an Acceptable
Property, the affected Acceptable Property will be released
from Lenders' lien upon substitution of the property so
proposed by Borrower and approved by the Required Lenders
without payment of release consideration; provided, however
that Borrower shall pay any reasonable and necessary expenses
incurred by Lenders.
(d) RENEWAL TERM LOAN. The Renewal Term Loans will be a
modification of the Term Loans. To that end, the Agent and Lenders will
make appropriate entries on their books and records to reflect the
modification of the Term Loans. The Renewal Term Loans shall not be an
novation of any of the Term Loans. The Renewal Term Loans cannot be
reborrowed. The payment terms of the Renewal Term Loans will be as
follows:
(i) INTEREST. Prior to maturity, whether by
acceleration or otherwise, the principal amount outstanding
under the Renewal Term Loans shall bear interest at the Base
Rate.
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(ii) AMORTIZATION. Interest on the outstanding
principal balance of the Renewal Term Loans shall be paid in
arrears on the first day of each month beginning with the
first day of the month following the month in which the Second
Closing occurs. Interest will be paid on the first day of each
month thereafter until the maturity date. Principal on Tranche
A will be repaid beginning on the first day of the first month
after the Second Closing in monthly payments based on a
mortgage style amortization over an assumed amortization
period of 84 months of the balance of the Tranche A portion of
the Renewal Term Loan with the principal amortization
calculated on an assumed interest payment of 7.5% for
illustrative purposes only. Principal payments will be in the
amounts set forth on EXHIBIT M. Principal on Tranche B will be
repaid beginning on the first day of the first month after the
Second Closing in equal monthly principal installments in an
amount equal to the balance of the Renewal Term Loan allocated
to Tranche B divided by 180. Principal payments will be due at
the same time as interest payments.
(iii) VOLUNTARY PREPAYMENTS. Voluntary prepayments of
principal, including accrued interest, may be made, in whole
or in part, at any time without penalty, except, in the case
of a LIBOR Rate borrowing, a payment prior to the end of the
LIBOR Period will require Borrower and Co-Obligors to pay
Lenders any breakage costs associated with such prepayment.
Any prepayments will be allocated ratably among the Lenders
based upon the then outstanding principal balances of their
respective Renewal Term Notes; provided, however, that a
Lender may consent to receive less than its pro rata portion
in which case the other Lender may receive more than its pro
rata portion. Any prepayments will be applied in inverse order
of maturity.
(iv) ALL AMOUNTS DUE. All remaining principal,
interest and expenses outstanding under the Renewal Term Loan
shall be due on March 24, 2004.
(e) RENEWAL REVOLVING LOAN. Concurrent with the Second Closing
and subject to the terms and conditions set forth herein, NationsBank
agrees to make a Renewal Revolving Loan to the Borrower and Co-Obligors
at any time and from time to time during the period from and including
the date of the Second Closing to but not including the fifth
anniversary of the Second Closing (or such earlier date if the Renewal
Revolving Committed Amount has been terminated as provided herein);
provided however that the aggregate amount of the Renewal Revolving
Loans outstanding shall not exceed the Renewal Revolving Committed
Amount. Subject to the terms of this Agreement, the Borrower and
Co-Obligors may borrow, repay and reborrow Renewal Revolving Loans.
(i) INTEREST RATE. Prior to maturity, whether by acceleration
or otherwise, the
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principal amount outstanding under the Renewal Revolving Loans shall
bear interest at the Base Rate; provided, however, at Borrower's
option, the Base Rate may be computed using NationsBank's floating
daily LIBOR rate.
(ii) METHOD OF BORROWING FOR RENEWAL REVOLVING LOANS. By no
later than 11:00 a.m. Eastern Standard or Daylight Time, as the case
may be, on the same Business Day, the Borrower shall submit a written
Notice of Borrowing in the form of EXHIBIT F to the Agent setting forth
the amount requested.
(iii) FUNDING OF RENEWAL REVOLVING LOANS. Upon receipt of a
Notice of Borrowing, NationsBank shall make the amount of the requested
Renewal Revolving Loan available to Borrower by 1:00 p.m. Central
Standard or Daylight Time, as the case may be, on the date specified in
the Notice of Borrowing by deposit, in Dollars, of immediately
available funds by crediting the account of Borrower on the books of
NationsBank.
(iv) PAYMENTS. Payment of all obligations arising under the
Renewal Revolving Loan shall be made as follows:
(A) INTEREST AND FEES. Interest on the outstanding
principal balance under the Renewal Revolving Loan shall be
paid in arrears on the first day of each month beginning on
the first day of the month following the month in which the
Second Closing occurs.
(B) VOLUNTARY PREPAYMENT. Voluntary prepayments of
principal or accrued interest may be made, in whole or in
part, at any time without penalty, except, in the case of a
LIBOR Rate borrowing, a payment prior to the end of the LIBOR
Period will require Borrower and Co-Obligors to pay Lenders
any breakage costs associated with such prepayment.
(C) MANDATORY PREPAYMENT. Borrower and Co-Obligors
must immediately prepay any amount by which the principal
balance of the Renewal Revolving Loans exceeds the Renewal
Revolving Committed Amount.
(D) ALL AMOUNTS DUE. All remaining principal,
interest and expenses outstanding under the Renewal Revolving
Loans shall become due on the fifth anniversary of the Second
Closing.
(E) NON-USE FEE. Borrower and Co-Obligors shall pay
NationsBank a non-use fee of one-quarter percent per annum on
the averaged unused portion of the Revolving Renewal Loan
payable quarterly in arrears.
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(f) After the Second Closing, all references in this Agreement
to the Loans, Revolving Loans, Revolving Notes, Term Loans and Term
Notes will be amended, as appropriate, to refer to the Renewal
Revolving Loans, Renewal Revolving Notes, Renewal Term Loans and
Renewal Term Notes.
(g) RELEASE. Provided that Borrower is not then in Default
under this Agreement, Lenders agree to release one or more Properties
from the mortgage and/or deed of trust encumbering such Property
provided that Lenders receive a prepayment equal to the Release Amount,
which will be applied on a pro rata basis between the Lenders based
upon the then outstanding amounts of the Term Loans or Renewal Term
Loans, as the case may be. Such prepayments will be applied in inverse
order of maturity. The Release Amount shall be determined as follows:
(i) If the release occurs prior to the Second
Closing, the amount of the Release Amount shall be determined
by Lenders in their sole discretion; or
(ii) If the release occurs subsequent to the Second
Closing, then the Release Amount shall be 70% of the appraised
value of such property based on the appraisal obtained in
determining that the property would be one of the Acceptable
Properties, provided, however, that if the Borrower and
Co-Obligors are refinancing the property with another lender,
then the Release Amount will be the greater of 70% of such
appraised value or the net proceeds of the refinancing.
(h) SUBSEQUENT APPRAISALS. After the Second Closing, should
Lenders be required by any regulatory authority to obtain updated
appraisals, Borrower agrees to cooperate with Lenders and Lenders'
appraiser in obtaining these appraisals and Borrower shall pay the
reasonably necessary costs of such appraisals.
INTEREST. For purposes hereof, the "LIBOR Rate" shall mean, for the
interest period applicable thereto, the rate of interest per annum (rounded
upwards, if necessary, to the nearest 1/100 of 1%) appearing on Telerate Page
3750 (or any successor page) as the London interbank offered rate for deposits
in Dollars at approximately 11:00 A.M. (London time) two Business Days prior to
the first day of such Interest Period for a term comparable to such Interest
Period; provided, however, if more than one rate is specified on Telerate Page
3750, the applicable rate shall be the arithmetic mean of all such rates. If,
for any reason, such rate is not available, the term "LIBOR Rate" shall mean,
with respect to any Eurodollar Loan for the Interest Period applicable thereto,
the rate of interest per annum (rounded upwards, if necessary, to the nearest
1/100 of 1%) appearing on Reuters Screen LIBO Page as the London interbank
offered rate for deposits in Dollars at approximately 11:00 A.M. (London time)
two Business Days prior to the first day of such Interest Period for a term
comparable to such Interest Period; provided, however, if more than one rate is
specified on Reuters Screen LIBO Page, the applicable rate shall be the
arithmetic mean of all such
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rates. Interest shall be calculated based upon a 360-day year in the case of
LIBOR Rate loans. If the adoption of or change in any applicable legal
requirement or any change in the interpretation or administration thereof by any
governmental authority or compliance by the Agent with any request or directive
(whether or not having the force of law) from any central bank or other
governmental authority, shall at any time as a result of any portion of the
principal balance of the Revolving Loans being maintained on the LIBOR Rate:
(a) Subject the Lenders to any tax (including without
limitation any United States Interest Equalization Tax), levy, impost,
duty, charge, fee (collectively "Taxes"), other than income and
franchise taxes of the United States and its political subdivisions; or
(b) Change the basis of taxation on payments due from the
Borrower and Co-Obligors to the Lenders under any LIBOR Rate borrowing
(otherwise than by a change in the rate of taxation of the overall net
income of the Lenders); or
(c) Impose, modify, increase or make applicable any reserve
requirement, special deposit requirement or similar requirement
(including, but not limited to, state law requirements and Regulation
D) against assets held by the Lenders, or against deposits or accounts
in or for the account of the Lenders, or against any loans made by the
Lenders, or against any other funds, obligations or other property
owned or held by Lenders (Lenders acknowledge no requirements exist on
the date of this Agreement); or
(d) Impose on the Lenders any other condition regarding any
LIBOR Rate borrowing that would adversely impact the yield realized by
Lenders;
and the result of any of the foregoing (a) through (d) is to increase the cost
to the Lenders of agreeing to make or of making, renewing or maintaining such
borrowing on the basis of the LIBOR Rate, or reduce the amount of principal or
interest received by the Lenders, then, upon demand by the Lenders, the Borrower
and Co-Obligors shall pay to the Lenders, from time to time as specified by the
Lenders, additional amounts which shall reasonably compensate the Lenders for
such increased cost or reduced amount relating to LIBOR Rate borrowings
outstanding after Lenders' demand. Lenders will promptly notify Borrower of any
proposed increase hereunder. The Lenders' reasonable determination of the amount
of any such increased cost, increased reserve requirement or reduced amount
shall be conclusive and binding, absent manifest error.
In no event shall the interest rate charged on the Loans exceed the
maximum rate allowed under applicable law. Any amounts paid in excess of the
maximum lawful rate shall be applied to reduce the principal amount of
Borrower's and Co-Obligors' obligations to Lenders or shall be refunded to
Borrower and Co-Obligors, at Lenders' election. After maturity (by acceleration
or otherwise), or upon the occurrence and continuation of a Default hereunder,
the principal amount under the Loans shall bear interest at the rate of interest
in effect immediately before maturity plus
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three percent (3%) ("Default Rate").
From the Effective Date through March 24, 2004, Borrower and
Co-Obligors, at their expense, shall enter into an Interest Rate Hedge Agreement
on terms satisfactory to Agent (which can include some or all of the existing
hedge agreement with First Union) protecting Borrower against variable interest
rate increases for a principal amount of at least 40% of the outstanding balance
of the Loan. The obligations of Borrower and Co-Obligors under any Interest Rate
Hedge Agreement or similar agreement shall not be reduced or diminished in the
event of any voluntary or involuntary prepayment of any amount due under any
Note or this Agreement.
CLOSING CONDITIONS. The obligation of the Lenders to enter
into this Agreement and make the Loans is subject to satisfaction of the
following conditions (in form and substance acceptable to the Lenders in their
sole discretion):
(a) EXECUTED CREDIT DOCUMENTS. Receipt by the Agent of duly
executed copies of: (i) this Agreement; (ii) the Notes; (iii) the
Collateral Documents and (iv) all other Loan Documents.
(b) CORPORATE DOCUMENTS. Receipt by the Agent of the
following:
(i) CHARTER DOCUMENTS. Copies of the articles or
certificates of incorporation or other charter documents of
Borrower and Co-Obligors certified to be true and complete as
of a recent date by the appropriate Governmental Authority of
the state or other jurisdiction of its incorporation and
certified by secretary or assistant secretary of Borrower and
Co-Obligors to be true and correct as of the Effective Date.
(ii) BYLAWS. A copy of the bylaws of Borrower and
Co-Obligors certified by a secretary or assistant secretary of
Borrower and Co-Obligors to be true and correct as of the
Effective Date.
(iii) RESOLUTIONS. Copies of resolutions of the Board
of Directors of Borrower and Co-Obligors approving and
adopting the Loan Documents to which it is a party, the
transactions contemplated therein and authorizing execution
and delivery thereof, and an incumbency certificate, certified
by a secretary or assistant secretary of Borrower and
Co-Obligors to be true and correct and in force and effect as
of the Effective Date.
(iv) GOOD STANDING. Copies of (A) certificates of
good standing, existence or its equivalent with respect to
each Borrower or Co-Obligor certified as of a recent date by
the appropriate Governmental Authorities of the state or other
jurisdiction of
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incorporation and each other jurisdiction in which the failure
to so qualify and be in good standing would have a Material
Adverse Effect on the business or operations of Borrower and
Co-Obligors in such jurisdiction and (B) to the extent
available, a certificate indicating payment of all corporate
franchise taxes certified as of a recent date by the
appropriate governmental taxing authorities.
(c) PERSONAL PROPERTY COLLATERAL. The Agent shall have
received, in form and substance satisfactory to the Agent:
(i) searches of Uniform Commercial Code ("UCC")
filings in the jurisdiction of the chief executive office of
Borrower and Co-Obligors and each jurisdiction where any
Collateral is located or where a filing would need to be made
in order to perfect the Lenders' security interest in the
Collateral, copies of the financing statements on file in such
jurisdictions and evidence that no liens exist;
(ii) duly executed UCC financing statements for each
appropriate jurisdiction as is necessary, in the Agent's sole
discretion, to perfect the Lenders' security interest in the
Collateral;
(iii) all material contracts or agreements to which a
Borrower or Co-Obligor is a party together with assignments
and third party consents as may be necessary or appropriate to
perfect the Lenders' security interest in the Collateral.
(d) REAL PROPERTY COLLATERAL. The Agent shall have received,
in form and substance satisfactory to the Agent:
(i) Duly executed first mortgages and/or deeds of
trust on the 25 Properties;
(ii) Copies of existing owner's mortgagee title
insurance policies on the 25 Properties;
(iii) A current title commitment from a title company
acceptable to Agent or title searches on the 25 Properties
reporting on the title to the 25 Properties from and after the
dates of the existing owner's policies;
(iv) Current appraisals on the 25 Properties;
(v) As-built surveys on the 25 Properties; and
(vi) Phase one environmental surveys on the 25
Properties.
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(e) EVIDENCE OF INSURANCE. Receipt by the Agent of copies of
insurance policies or certificates of insurance of the Borrower and
Co-Obligors evidencing liability and casualty insurance meeting the
requirements set forth in the Loan Documents, including, but not
limited to, naming the Agent and Lenders as sole loss payee on behalf
of the Lenders.
(f) CORPORATE AND CAPITAL STRUCTURE. The corporate capital and
ownership structure of the Borrower and Co-Obligors shall be
satisfactory in form and substance to the Agent. Agent shall have
approved the terms of the Subordinated Debt.
(g) CERTAIN CONSENTS. Receipt by the Agent of evidence that
all governmental, shareholder and material third party consents
including, without limitation, written consent, if necessary in the
sole discretion of the Agent, of any existing lenders or bondholders
and expiration of all applicable waiting periods without any action
being taken by any authority that could reasonably be likely to
restrain, prevent or impose any material adverse conditions on the
transactions contemplated by this Agreement or that could reasonably be
likely to seek or threaten any of the foregoing, and no law or
regulation shall be applicable which in the judgment of the Agent could
reasonably be likely to have such effect.
(h) MATERIAL ADVERSE EFFECT. There shall not have occurred a
change since June 28, 1998 that has had or could reasonably be expected
to have a Material Adverse Effect (including matters related to
litigation, tax, accounting, labor, insurance and pension liabilities).
(i) LITIGATION. There shall not exist any (i) order, decree,
judgment, ruling or injunction which restrains the consummation of the
transactions contemplated by this Agreement or (ii) any pending or
threatened action, suit, investigation or proceeding which if adversely
determined against the Borrower and Co-Obligor would have or would
reasonably be expected to have a Material Adverse Effect.
(j) OTHER INDEBTEDNESS. Receipt by the Agent of evidence that
after the funding of the Loans, the Borrower and Co-Obligors shall have
no borrowed money Indebtedness other than the Indebtedness under the
Loan Documents, the equipment loan facility with CIT not to exceed
$20,000,000.00, subordinated indebtedness outstanding of at least
$13,000,000.00, and other than miscellaneous Indebtedness which does
not exceed $1,000,000.00 in the aggregate. Borrower shall have closed
its loan with CIT and is entitled to receive proceeds not to exceed
$20,000,000.00, with the principal terms of the loan with CIT being set
forth on Exhibit L.
(k) OFFICER'S CERTIFICATES. The Agent shall have received a
certificate or certificates executed by the president or chief
financial officer of the Borrower as of the Effective Date stating that
(A) the Borrower and Co-Obligors are in compliance with all
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<PAGE> 23
existing financial obligations, (B) all governmental, shareholder and
third party consents and approvals, if any, with respect to the Loan
Documents and the transactions contemplated thereby have been obtained,
(C) no action, suit, investigation and proceeding is pending or to his
knowledge threatened in any court or before any arbitrator or
governmental instrumentality that purports to affect the Borrower,
Co-Obligor or any transaction contemplated by the Loan Documents, or
could have or might be reasonably expected to have a Material Adverse
Effect, (D) immediately after giving effect to this Agreement, the
other Loan Documents and all the transactions contemplated therein to
occur on such date, (1) the Borrower and Co-Obligors are solvent, (2)
no Default or Event of Default exists, (3) all representations and
warranties contained herein and in the other Loan Documents are true
and correct in all material respects, and (4) the Borrower and
Co-Obligors are in compliance with each of the financial covenants set
forth in Section 36.
(l) FEES AND EXPENSES. Payment by the Borrower and Co-Obligors
of all fees and expenses owed by them to the Lenders and the Agent,
including, without limitation, payment to the Agent of the commitment
fee contained the Fee Letter.
(m) OPINION OF BORROWER'S GENERAL AND LOCAL COUNSEL. Delivery
of an opinion of Borrower's general and local counsel to Lenders and
Agent in the form attached as Exhibit I.
(n) FIRST UNION. First Union currently is the holder of the
existing First Union debt. As part of this credit facility, First Union
will become a party to this Agreement. The existing First Union debt
will be paid down to $22,500,000. The $22,500,000 balance of the
existing First Union debt will then be amended and restated and will
become a part of the Term Loans. The note evidencing the existing First
Union debt will be amended and restated and will be one of the Term
Loan Notes. The First Union Mortgages will be amended and restated to
reflect that the indebtedness secured includes the entire amount of the
Loan and to release the equipment that is included in the security
under the First Union Mortgages.
(o) DOCUMENTARY STAMP TAX. There shall be delivered by
Borrower in favor of Lenders an indemnity against documentary stamp or
other taxes, and appropriate affidavits of execution.
(p) OTHER. Receipts by the Lenders of such other documents,
instruments, agreements or information as reasonably requested by any
Lender, including, but not limited to, information regarding
litigation, tax, accounting, labor, insurance, pension liabilities
(actual or contingent), real estate leases, material contracts, debt
agreements, property ownership and contingent liabilities of the
Borrower and Co-Obligors.
CONDITIONS TO ALL EXTENSION OF CREDIT. In addition to the conditions
precedent stated
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elsewhere herein, the Lenders shall not be obligated to make, continue or
convert Loans unless:
(a) NOTICE. The Borrower shall have delivered in the case of
any Revolving Loan, a Notice of Borrowing, duly executed and completed,
by the time specified in Section 2.
(b) REPRESENTATIONS AND WARRANTIES. The representations and
warranties made by the Borrower and Co-Obligors in any Loan Document
are true and correct in all material respects at and as if made as of
such date.
(c) NO DEFAULT. No Default or Event of Default shall exist or
be continuing either prior to or after giving effect thereto.
(d) NO MATERIAL ADVERSE EFFECT. There shall not have occurred
any Material Adverse Effect.
(e) AVAILABILITY. Immediately after giving effect to the
making of such Loan (and the application of the proceeds thereof), the
sum of the Revolving Loans outstanding shall not exceed the Revolving
Commitment Amount.
CAPACITY. Borrower warrants that it is and shall remain a
corporation duly organized and in good standing under the laws of Ohio. CGR
Management Corporation warrants that it is and shall remain a corporation duly
organized and in good standing under the laws of the State of Florida. Florida
Cooker LP, Inc., warrants that it is and shall remain a corporation duly
organized and in good standing under the laws of the State of Florida. Southern
Cooker Limited Partnership warrants that it is and shall remain a limited
partnership duly organized and in good standing under the laws of the State of
Ohio. Borrower and each Co-Obligor warrants that each is and shall remain duly
qualified to do business in each state in which the failure to qualify would
result in a Material Adverse Effect on Borrower or any Co-Obligor or their
business. Borrower and each Co-Obligor warrants that its execution of and
performance under this Agreement and all related documents are permitted under
and will not violate any provision of Borrower's and each Co-Obligor's Charter
or By-Laws or any agreement to which Borrower or any Co-Obligor is a party or
any law, rule, ordinance, regulation or Court Order to which Borrower or any
Co-Obligor is subject. Borrower and each Co-Obligor further warrants that the
execution of all necessary resolutions and other prerequisites of corporate
action, as applicable, have been duly performed so that the individual executing
this Agreement and related documents on behalf of Borrower and each Co-Obligor
is duly authorized to bind Borrower and each Co-Obligor by his signature.
Borrower warrants that Borrower and each Co-Obligor is solvent and, after giving
effect to the transaction contemplated by this Agreement, will be solvent, as
that term is defined in the Bankruptcy Code.
NO SUBSIDIARIES. Other than the Co-Obligors, Borrower warrants
that it presently has
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no subsidiaries or interests in any partnership or other
business entity.
CORPORATE RECORDS. Borrower and each Co-Obligor covenant to
maintain or cause to be maintained current corporate minute books and stock
ledgers and agree to allow Lenders to inspect the same at any time during normal
business hours upon reasonable notice.
ACCOUNTING. Borrower and Co-Obligors warrant that Borrower's
and Co-Obligors' accounting complies with applicable "GAAP" and covenant that
they will continue to apply GAAP throughout the life of the Term Loans and
Revolving Loans.
ERISA. Borrower and Co-Obligors have not incurred and shall
not incur a material accumulated funding deficiency within the meaning of ERISA
and have not incurred any material liability to the Pension Benefit Guaranty
Corporation established under ERISA (or any successor thereto under ERISA) in
connection with any retirement plan, and no reportable event has occurred and is
continuing or shall occur with respect to any welfare or benefit plan maintained
by Borrower or Co-Obligors.
BOOKS, RECORDS AND PROPERTY. Borrower and Co-Obligors covenant
to maintain financial books and records in a manner that will allow financial
statements to be prepared in accordance with GAAP, consistently applied, and
shall allow Lenders to inspect such records during normal business hours upon
reasonable notice. Lenders have full authority to inspect all property of
Borrower and Co-Obligors during normal business hours upon reasonable notice.
INSURANCE. In addition to any specific insurance requirements
contained herein or in any other document pertaining to the Loans, Borrower and
Co-Obligors agree to generally maintain adequate insurance against casualty and
liability losses in accordance with customary practices in Borrower's and
Co-Obligors' field of enterprise. Borrower and Co-Obligors agree to provide
Agent with proof of the existence of such insurance upon demand.
CHIEF EXECUTIVE OFFICE. Borrower and Co-Obligors warrant that
the address designated herein to which notices are to be sent to Borrower and
Co-Obligors is Borrower's and Co-Obligors' chief executive office. Borrower and
Co-Obligors agree to notify Agent in writing of any change thereof and agree
that the same shall not in any event be moved outside Palm Beach County,
Florida, without Lenders' prior written consent.
NO DEFAULTS UNDER OTHER AGREEMENTS. Borrower and Co-Obligors
warrant that neither Borrower nor any Co-Obligor, nor to the best of Borrower's
and Co-Obligors' knowledge, information, and belief, any other party thereto is
presently in default beyond any applicable notice and/or cure periods in any
material respect under any material contract or agreement to which Borrower or
any Co-Obligor is a party, and no condition presently exists which, with the
giving of notice, the passing of time, or both, would cause such a default.
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DISCLOSURE OF LITIGATION. Except as disclosed on EXHIBIT J,
there are no actions, suits or proceedings pending (including, but not limited
to, matters relating to any Environmental Laws), or, to the best of knowledge of
Borrower or any Co-Obligor, threatened, against or affecting Borrower or any
Co-Obligor or involving the validity or enforceability of any of the Loan
Documents, at law or in equity, or before any governmental or administrative
agency, except actions, suits and proceedings that are covered by insurance in
all material respects and that, if adversely determined, would not impair the
ability of Borrower or any Co-Obligor to perform each and every one of its
obligations under this Agreement; or materially and adversely affect Borrower's
or any Co-Obligor's business or Borrower's or any Co-Obligor's ability to carry
on its business substantially in the manners now conducted (individually or in
the aggregate).
FINANCIAL STATEMENTS.
(a) WARRANTIES. Borrower and Co-Obligors warrant that
Borrower's consolidated quarterly and annual financial statements
delivered to Lenders in connection with the Loans have been prepared in
accordance with Generally Accepted Accounting Principles, consistently
applied, and present fairly the financial condition of Borrower as of
the date or dates thereof and are true and correct in all material
respect. Without limiting the foregoing, Borrower and Co-Obligors
warrant that such financial statements disclose all known material
contingent liabilities as well as material direct liabilities. Borrower
and Co-Obligors acknowledge that Lenders have advanced (or shall
advance) the Loans in reliance upon such financial statements, and
Borrower and Co-Obligors warrant that no Material Adverse Effect has
occurred to the financial condition of Borrower and Co-Obligors as set
forth in the most recent financial statements.
(b) REPORTING REQUIREMENTS. Borrower covenants to furnish
Lenders Borrower's and Co-Obligors' consolidated annual audited
financial statements, annual budget and cash flow projections for the
upcoming year within ninety (90) days of the close of the preceding
fiscal year. Each audit must be performed by a certified public
accountant reasonably acceptable to Lenders, at Borrower's expense. In
addition, Borrower covenants to furnish to Lenders, on or before the
forty-fifth (45th) day following the end of each fiscal quarter,
Borrower's and Co-Obligors' cash flow statements, balance sheets and
covenant calculation report together with an officer's certificate
executed by the chief financial officer of Borrower certifying
compliance with the financial covenants set forth herein and further
stating that, to the best of his knowledge, information and belief, no
Default exists hereunder as of the date of the certification. Borrower
and Co-Obligors also covenant to furnish to Lenders, upon demand,
copies of Borrower's and Co-Obligors' tax returns and additional
financial information in form and substance acceptable to Lenders. In
addition, Borrower covenants to furnish to Lender on or before the 60th
day after the beginning of each fiscal year copies of Borrower and
Co-Obligors' annual budget. Borrower shall also provide to Lenders
copies
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of any materials filed with the Securities and Exchanges Commission
and/or distributed to Borrower's shareholders.
NOTICE OF CHANGES IN FINANCIAL CONDITION AND DEFAULTS.
Borrower and Co-Obligors covenant to give Lenders prompt written notice of (i)
the creation or discovery of any material additional contingent liability or the
occurrence of any other material adverse change in the financial condition of
Borrower or Co-Obligors, and (ii) the occurrence of any event, or presence of
any condition, which constitutes a Default hereunder or which with the giving of
notice, the passing of time, or both, would constitute a Default or which would
have a Material Adverse Effect. Borrower and Co-Obligors covenant that they will
not change their fiscal year without obtaining the prior written consent of
Lenders.
NO UNPAID TAXES. Borrower and Co-Obligors have filed or
properly extended all tax returns and reports required to be filed and have paid
all taxes, assessments, fees and other governmental charges levied upon them or
upon any of their properties or income, which are due and payable, including
interest and penalties, or have provided adequate reserves for the payment
thereof, other than any taxes or assessments that could not impair the ability
of Borrower and Co-Obligors to perform each and every one of their obligations
hereunder; or materially and adversely affect the ability of Borrower or any
Co-Obligor to carry on its business in the manner as now conducted. To the best
knowledge of Borrower and each Co-Obligor, no tax liens have been filed against
Borrower, any Co-Obligor or any of their properties, that could impair the
ability of Borrower or any Co-Obligor to perform each and every one of their
obligations hereunder; or materially and adversely affect the business of
Borrower or any Co-Obligor.
NO UNTRUE OR MISLEADING REPRESENTATIONS. Borrower and
Co-Obligors warrant that no information, exhibit or report furnished in writing
by Borrower or a Co-Obligor to Lenders in connection with the Loans contains any
untrue statement of material fact or omits to state a material fact necessary to
make the statements contained therein not misleading in any material respect.
COMPLIANCE WITH LAW. To the best of their knowledge, Borrower
and Co-Obligors warrant that the business activities of Borrower and each
Co-Obligor are conducted in material compliance with all applicable laws and
regulations. Borrower and Co-Obligors covenant that such activities shall
continue to be so conducted.
ASSISTANCE IN LITIGATION. Borrower and Co-Obligors covenant
to, upon request, cooperatively participate in any proceeding in which Borrower
and Co-Obligors are not an adverse party to Lenders and which concerns Lenders'
rights regarding the Loans.
NAME. Borrower warrants that during the past five (5) years,
Borrower and Co-Obligors have not been known under or done business under any
name other than the name used by Borrower and Co-Obligors in executing this
Agreement. Borrower and Co-Obligors agree to give
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Agent written notice no later than 15 days before a Borrower or Co-Obligor
begins using any name other than that used in executing this Agreement.
NEGATIVE PLEDGE. Except for any liens in favor of Lenders,
liens permitted under Section 35 hereof, Permitted Liens and easements or minor
encumbrances relating to real estate, Borrower and Co-Obligors covenant and
agree that they will not suffer, permit or grant any lien, security interest,
deed of trust, mortgage, deed to secure debt, pledge, assignment or other
collateral assignment of any of their assets in favor of any party other than
Lenders without the prior written consent of Agent.
FEES AND EXPENSES. Upon demand, Borrower and Co-Obligors will
advance to Lenders or, at Lenders' option, reimburse Lenders for, the following
expenses:
(a) AGENCY FEE. Borrower and Co-Obligors shall pay Agent an
agency fee per annum as set forth in the Fee Letter. This fee will be
due and payable upon execution of this Agreement. The fee will be fully
earned upon the due date and will not be refunded or pro rated in the
event the Loans are prepaid prior to maturity.
(b) TAXES. All taxes (other than income taxes) that Lenders
may be required to pay because of the Loans.
(c) ADMINISTRATION. All expenses that Lenders may incur in
connection with the preparation, execution, or enforcement of this
Agreement or of any other document pertaining to the Loans;
(d) COSTS OF COLLECTION. All court costs and other costs of
collecting any debt, overdraft or other obligation included in the
Loans;
(e) LITIGATION. All costs arising from any litigation,
investigation, or administrative proceeding (whether or not Lenders are
a party thereto) that Lenders may incur as a result of the Loans or as
a result of Lenders' association with Borrower and Co-Obligors,
including, but not limited to, expenses incurred by Lenders in
connection with a case or proceeding involving Borrower or any
Co-Obligor under any chapter of the Bankruptcy Code or any successor
statute thereto;
(f) ATTORNEYS FEES. Reasonable attorneys' fees incurred in
connection with any of the foregoing.
If Lenders pay any of the foregoing expenses, they shall become a part of the
Term Loans or Renewal Term Loans and shall bear interest at the rate of interest
then in effect. This paragraph shall remain in full effect regardless of the
full payment of the Loans, the purported termination of this
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Agreement, the delivery of the executed original of this Agreement to Borrower
and Co-Obligors, or the content or accuracy of any representation made by
Borrower and Co-Obligors to Lenders; provided, however, Lenders may terminate
this paragraph by executing and delivering to Borrower and Co-
Obligors a written instrument of termination specifically referring to this
Paragraph.
FURTHER ASSURANCES. Borrower and Co-Obligors covenant to
execute such other documents that Lenders may reasonably deem necessary to
further evidence the obligations provided for herein.
DEFAULT CERTIFICATES. Borrower and Co-Obligors covenant to
deliver to Agent, within five (5) business days after request and forty-five
(45) days after the end of each quarter, the certificate of Borrower, of
Co-Obligors or of Borrower's appropriate representative (as specified by Agent)
stating whether, to the best of the person's knowledge, information, and belief
and after due investigation, a Default then exists under this Agreement. The
certificate shall describe with particularity any Default and shall address with
particularity any circumstances or subjects described by Agent in its request.
Borrower and Co-Obligors covenant that they will promptly forward to Agent a
copy of any notice of default Borrower receives from any party with which any
Borrower has a contract, where the amount of such contract exceeds $250,000.00.
RECITALS. Borrower and Co-Obligors warrant and agree that
the recitals set forth at the beginning of this Agreement relating to them are
true.
NO BURDENSOME AGREEMENTS. Borrower and Co-Obligors warrant
that Borrower and each Co-Obligor is not a party to any material contract or
agreement and is not subject to any material contingent liability that does or
may impair the ability of Borrower or any Co-Obligor to perform under the terms
of this Agreement. Borrower and Co-Obligors further warrant that the execution
and performance of this Agreement will not cause a default, acceleration or
other event under any other contract or agreement to which Borrower or any
Co-Obligor or any property of Borrower or any Co-Obligor is subject, and will
not result in the imposition of any charge, penalty, lien or other encumbrance
against any property of Borrower or any Co-Obligor except in favor of Lenders.
LEGAL AND BINDING AGREEMENT. Borrower and Co-Obligors warrant
that the execution and performance of this Agreement will not violate any
judicial or administrative order or governmental law or regulation, and that
this Agreement is valid, binding and enforceable according to its terms, subject
to bankruptcy and other laws affecting the rights of creditors generally.
NO CONSENT REQUIRED. Borrower and Co-Obligors warrant that
Borrower's and Co-Obligors' execution, delivery and performance of this
Agreement do not require the consent of or the giving of notice to any third
party including, but not limited to, any other lender, governmental body or
regulatory authority, which has not been obtained.
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NO DEFAULT. Borrower and Co-Obligors warrant that, as of
the execution of this Agreement, no Default exits hereunder and no condition
exists which, with the giving of notice, the
passing of time, or both, would constitute such a Default. All representations
and warranties made by Borrower and Co-Obligors as of the date of this Agreement
shall survive the Closing.
NEGATIVE COVENANTS. Without Required Lenders' prior written
consent, Borrower and Co-Obligors shall not do any of the following:
(a) OTHER DEBT. Incur, create, assume or permit to exist any
indebtedness for borrowed money except:
(i) Indebtedness to Lenders under this Agreement.
(ii) Debts existing as of the execution hereof and
disclosed in the financial statements delivered to Lenders in
an amount approved by Lenders and any modifications, renewals
or extensions thereof and any refinancing of such debt with no
increase in the amount of such refinanced debt.
(iii) Unsecured debts on open account incurred in the
ordinary course of business.
(iv) Indebtedness arising from the negotiation and
deposit of instruments received in the ordinary course of
business.
(v) Borrower and/or Co-Obligors may borrow or sell
and lease back up to $20,000,000.00 from CIT for equipment
financing in 1998.
(vi) Borrower and/or Co-Obligors may borrow or enter
into sale lease-back transactions with lenders or other
financial sources so long as the incurrence of additional
financing obligations does not cause Borrower and/or
Co-Obligors to violate any provisions of this Agreement
including the financial covenants contained in Section 36
below.
(b) PLEDGE OR MORTGAGE OF ASSETS. Except for Permitted Liens
or as otherwise permitted herein, (together with renewals and
extensions thereof), pledge or mortgage any of its existing, or future
acquired assets to any other party.
(c) STOCK AND SUBORDINATED DEBT TRANSACTIONS. Redeem any stock
other than the Tender Offer, warrants, or debt securities convertible
into stock or prepay any amounts on subordinated debt including the
Subordinated Debt.
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(d) REORGANIZATION. Enter into any agreement to merge,
consolidate, or otherwise reorganize or recapitalize.
(e) DISPOSITION OF ASSETS. Except as permitted herein, sell,
lease, or otherwise transfer its assets in any transaction which is not
in the ordinary course of business; provided, this restriction shall
not apply to transfers among Borrower and/or any Co-Obligors.
(f) GUARANTIES. Except for the guaranty existing on the date
hereof and disclosed in the financial statements, guarantee any
obligations of any other business or individual, except through the
endorsement of items tendered to Borrower and Co-Obligors as payment in
the ordinary course of business.
(g) CREATION OF NEW SUBSIDIARIES. Acquire an interest in any
subsidiary corporation or entity.
(h) DIVIDENDS. Borrower and Co-Obligors shall not declare any
dividends if Borrower is then in Default, if events have occurred of
which, but for the passage of time will constitute a Default or after
having given effect to such dividends, Borrower would then be in
Default; provided this shall not prohibit dividends payable in stock or
stock splits.
(i) CAPITAL EXPENDITURES. Open more than eight (8) restaurants
in calendar year 1998, eight (8) restaurants in calendar year 1999; ten
(10) restaurants in calendar year 2000; ten (10) restaurants in
calendar year 2001; twelve (12) restaurants in calendar year 2002; and
twelve (12) restaurants in calendar year 2003.
(j) CHANGE OF CONTROL. Suffer or permit a Change of Control of
Borrower to occur.
(k) ERISA MATTERS. Suffer or permit any of the following
events or conditions to exist or occur: (A) any "accumulated funding
deficiency," as such term is defined in section 302 of ERISA and
Section 412 of the Code, whether or not waived, shall exist with
respect to any ERISA Plan, or any lien shall arise on the assets of the
Borrower or Co-Obligors or any ERISA Affiliate in favor of the PBGC of
an ERISA Plan; (B) a Termination Event shall occur with respect to a
Single Employer Plan, which is, in the reasonable opinion of the Agent,
likely to result in the termination of such Plan for the purposes of
Title IV or ERISA; (C) a Termination Event shall occur with respect to
a Multiemployer Plan or Multiple Employer Plan, which is, in the
reasonable opinion of the Agent, likely to result in (i) the
termination of such Plan for purposes of Title IV of ERISA, or (ii) the
Borrower or Co- Obligors or any ERISA Affiliate incurring any liability
in connection with a withdrawal from, reorganization of (within the
meaning of Section 4241 of ERISA), or insolvency of
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(within the meaning of Section 4245 of ERISA) such Plan; or (D) any
prohibited transaction (within the meaning of Section 406 of ERISA of
Section 4975 of the Code) or breach of fiduciary responsibility shall
occur which may subject the Borrower or Co-Obligors or any ERISA
Affiliate to any liability under Sections 406, 409, 502(i), or 502(l)
or ERISA or Section 4975 of the Code, or under any agreement or other
instrument pursuant to which the Borrower or Co-Obligors or any ERISA
Affiliate has agreed or is required to indemnify any person against any
such liability.
(l) FISCAL YEAR; ORGANIZATIONAL DOCUMENTS. Change their fiscal
year or materially change their articles or certificate of
incorporation or their by-laws.
(m) INVESTMENTS. Purchase or acquire an interest in any
stocks, bonds, debentures, instruments or securities other than
Permitted Investments.
FINANCIAL COVENANTS. Borrower and Co-Obligors shall maintain the
following financial covenants computed on a rolling four-quarter basis as
determined by GAAP on a consolidated basis (unless otherwise noted):
(a) FIXED CHARGE COVERAGE RATIO. Borrower and Co-Obligors
shall maintain a fixed charge coverage ratio of at least 1.2 to 1.0.
This is defined as Net Income plus depreciation, plus Interest Expense,
plus Operating Lease expenses, divided by current maturities of long
term debt (including Capital Leases) plus Interest Expense, plus
Operating Lease expense, plus amounts paid on Subordinated Debt, plus
dividends accrued, computed on a rolling four quarter basis.
(b) SENIOR FUNDED DEBT TO EBITDA RATIO. Borrower shall
maintain a senior funded debt to EBITDA ratio of no more than 4.0 to
1.0 for the fiscal year ended December 31, 1998; 3.25 to 1.0 for the
fiscal year ended December 31, 1999; and 2.75 to 1.0 for the fiscal
year ended December 31, 2000 and years thereafter. This is defined as
(Funded Debt (including Capital Leases) but excluding Subordinated
Debt) divided by EBITDA, computed on a rolling four quarter basis.
(c) RENT COVERAGE RATIO. Borrower shall maintain a rent
adjusted senior funded debt to EBITDAR ratio of no more than 4.25 to 1
for the fiscal year ended December 31, 1998; 4.00 to 1 for the fiscal
year ended December 31, 1999; and 3.5 to 1 for the fiscal year ending
December 31, 2000 and years thereafter. This is defined as ((Funded
Debt minus Subordinated Debt) plus (operating lease expense times 8))
divided by (EBITDA plus lease expense other than Capital Lease
expense), computed on a rolling four quarter basis.
Environmental Matters
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(a) ENVIRONMENTAL LAW COMPLIANCE. Borrower and Co-Obligors
warrant and covenant that the conduct of Borrower's and Co-Obligors'
business operations do not and will not violate, in any material
respect, any federal laws, rules, or ordinance for environmental
protection, regulations of the Environmental Protection Agency and any
applicable local or state law, rule, regulation, or rule of common law
and any judicial interpretation thereof relating primarily to the
environmental or Hazardous Materials and Borrower and Co- Obligors will
not use or permit any other party to use any Hazardous Materials at any
of Borrower's or Co-Obligors' places of business or at any other
property owned by Borrower and Co-Obligors except such materials as are
incidental to Borrower's and Co-Obligors' normal course of business,
maintenance and repairs and which are handled in material compliance
with all applicable environmental laws. Upon the occurrence of a
Default or if necessary to meet any regulatory requirement imposed on
any Lender, Borrower and Co-Obligors agree to permit Lenders, its
agents, contractors, and employees to enter and inspect any of
Borrower's and Co-Obligors' places of business or any other property of
Borrower and Co-Obligors at any reasonable time upon five (5) days
prior notice for the purpose of conducting an environmental
investigation and audit (including taking physical samples) to insure
that Borrower and Co-Obligors are complying with this covenant and
Borrower and Co-Obligors shall reimburse Lenders on demand for the
costs of any such environmental investigation and audit. Borrower and
Co-Obligors shall provide Lenders, its agents, contractors, employees,
and representatives with access to and copies of any and all data and
documents relating to or dealing with any Hazardous Materials used,
generated, manufactured, stored or disposed of by Borrower's and
Co-Obligors' business operations within five (5) days of the request
thereof.
(b) NOTIFICATION OF ENVIRONMENTAL CLAIMS. Borrower and
Co-Obligors shall immediately advise Lenders in writing of (i) any and
all material enforcement, cleanup, remedial, removal, or other
governmental or regulatory actions instituted, completed, or threatened
pursuant to any applicable federal, state, or local laws, ordinances or
regulations relating to any Hazardous Materials affecting Borrower's
and Co-Obligors' business operations; and (ii) all material claims made
or threatened by any third party against Borrower or any Co-Obligor
relating to damages, contribution, cost recovery, compensation, loss or
injury resulting from any Hazardous Materials. Borrower and Co-Obligors
shall immediately notify Agent of any material remedial action taken by
Borrower or any Co-Obligor with respect to Borrower's and Co-Obligors'
business operations.
(c) INDEMNIFICATION. Borrower and Co-Obligors shall indemnify,
defend, and hold Lenders and Agent and their successors and assigns
harmless from and against any and all claims, demands, suits, losses,
damages, assessments, fines, penalties, costs, or other expenses
(including reasonable attorneys' fees and court costs) arising from or
in any way related to actual or threatened damage to the environment,
agency costs of investigation, personal injury or death, or property
damage, due to a release or alleged release of Hazardous
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Materials, arising from Borrower's and Co-Obligors' business
operations, any other property owned by Borrower or any Co-Obligor or
in the surface or ground water arising from Borrower's or any
Co-Obligors' business operations, or gaseous emissions arising from
Borrower's or any Co-Obligors' business operations or any other
condition existing from Borrower's and Co-Obligors' business
operations resulting from the use or existence of Hazardous Materials,
whether such claim proves to be true or false. Borrower and Co-Obligors
further agree that their indemnity obligations shall include, but are
not limited to, liability for damages resulting from the personal
injury or death of an employee of the Borrower or any Co-Obligor,
regardless of whether the Borrower or any Co-Obligor has paid the
employee under the worker's compensation laws of any state or other
similar federal or state legislation for the protection of employees.
The term "property damage" as used in this paragraph includes, but is
not limited to, damage to any real or personal property of the Borrower
or any Co-Obligor, the Lenders, and of any third parties. The
Borrower's and Co-Obligors' obligations under this paragraph shall
survive the repayment of the Loans.
YEAR 2000 REPRESENTATIONS AND WARRANTIES.
(a) ANALYSIS AND DEVELOPMENT. Borrower has (i) begun analyzing
the operations of Borrower and it subsidiaries and affiliates that
could be adversely affected by failure to become Year 2000 compliant
(that is, that computer applications, imbedded microchips and other
systems will be able to perform date-sensitive functions prior to and
after December 31, 1999), and (ii) developed a plan for becoming Year
2000 compliant in a timely manner, the implementation of which is on
schedule in all material respects. Borrower reasonably believes that it
will become Year 2000 compliant for its operations and those of its
subsidiaries and affiliates on a timely basis except to the extent that
a failure to do so could not reasonably be expected to have a material
adverse effect upon the financial condition of Borrower.
(b) SUPPLIERS AND VENDORS. Borrower reasonably believes any
suppliers and vendors that are material to the operations of Borrower
or its subsidiaries and affiliates will be Year 2000 compliant for
their own computer applications except to the extent that a failure to
do so could not reasonably be expected to have a material adverse
effect upon the financial condition of Borrower.
(c) NOTICE TO AGENT. Borrower will promptly notify Agent in
the event Borrower determines that any computer application which is
material to the operations of Borrower, its subsidiaries or any of its
material vendors or suppliers will not be fully Year 2000 compliant on
a timely basis, except to the extent that such failure could not
reasonably be expected to have a material adverse effect upon the
financial condition of Borrower.
DEFAULT DEFINED. The occurrence of any one or more of the
following events shall
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constitute a Default under this Agreement:
(a) MONETARY DEFAULT. The failure of Borrower and Co-Obligors
to timely pay any amount due Lenders under the Loans within five (5)
days of the due date; provided, however, that Borrower and Co-Obligors
shall not be in Default as a result of a missed interest payment
if a Lender has failed to deliver to Borrower an interest statement
for such payment.
(b) BREACH OF COVENANT. The failure of Borrower or any
Co-Obligor to comply with any of the terms and obligations of this
Agreement (other than those addressed in a, c, d, e, f or g hereof) for
a period of 30 days from the earlier of (i) such time that the event or
fact is known or reasonably should be known to Borrower or any
Co-Obligor or (ii) the event or fact is disclosed in writing by Agent
or any Lender to Borrower.
(c) BREACH OF WARRANTY. Lenders' discovery that any
representation or warranty in connection with this Agreement or the
Loans or any other Loan Document was materially false when made.
(d) DEFAULT UNDER OTHER DOCUMENT. Subject to applicable cure
periods, the occurrence of a default under the terms of any document
evidencing or otherwise pertaining to the Loans, including, without
limitation, the Loan Documents.
(e) VOLUNTARY BANKRUPTCY. The Borrower or any Co-Obligor shall
commence a voluntary case or other proceeding seeking liquidation,
reorganization or other relief with respect to itself or its debts
under any bankruptcy, insolvency or other similar law now or hereafter
in effect or seeking the appointment of a trustee, receiver,
liquidator, custodian or other similar official of it or any
substantial part of its property or shall consent to any such relief or
to the appointment of or taking possession by any such official in an
involuntary case or other proceeding commenced against it, or shall
make a general assignment for the benefit of creditors, or shall fail
generally to pay its debts as they become due, or shall take any
corporate action to authorize any of the foregoing.
(f) INVOLUNTARY BANKRUPTCY. An involuntary case or other
proceeding shall be commenced against Borrower or any Co-Obligor
seeking liquidation, reorganization or other relief with respect to it
or its debts under any bankruptcy, insolvency or similar law now or
hereafter in effect or seeking the appointment of a trustee, receiver,
liquidator, custodian or other similar official of it or any
substantial part of its property, and such involuntary case or other
proceeding shall remain undismissed or unstayed for a period of ninety
(90) days; or an order for relief shall be entered against the Borrower
and any Co-Obligor under the bankruptcy laws as now or hereafter in
effect.
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(g) DEFAULT UNDER OTHER LOANS. Subject to any grace or cure
periods, the occurrence of a default under the terms of any document or
agreement evidencing, securing or otherwise pertaining to the extension
of credit in excess of [$500,000] by any other party to Borrower or any
Co-Obligor, the default, which if not cured, would permit the
acceleration of the debt.
REMEDIES UPON DEFAULT. Upon a Default under Section 39,
Lenders may exercise any or all of the following remedies:
(a) REMEDIES. Agent, on behalf of Lenders, may exercise any
right that they may have at law or equity, including those under the
Loan Documents and including, but not limited to, an action to collect
the Loans and foreclosure on some or all of the Collateral. All
obligations of Lenders to advance or readvance under the Revolving
Loans will terminate. The rate of interest on the Loans will be
increased to the Default Rate.
(b) APPLICATION OF PROCEEDS. All amounts received by Lenders
for Borrower's or Co-Obligors' account by exercise of their remedies
hereunder shall be applied as follows: First, to the payment of all
reasonable expenses incurred by Lenders in exercising their rights
hereunder, including reasonable attorney's fees, and any other expenses
due Lenders hereunder from Borrower and Co-Obligors; Second, to the
payment of all interest included in the Loans, in such order as Lenders
may elect; Third, to the payment of all principal included in the
Loans; and Fourth, surplus to Borrower, the Co-Obligors or other party
entitled thereto.
(c) ESCROW MORTGAGES. Upon a Default under Section 39, if the
Escrow Mortgages have not yet been recorded, Lenders may record the
Escrow Mortgages, and obtain a mortgagee's title insurance policy on
the Initial Mortgages and the Escrow Mortgages. Borrower and
Co-Obligors shall pay all costs associated with recording the Escrow
Mortgages, including any indebtedness or recording taxes and legal fees
and shall pay the costs of the mortgagee's title insurance policy for
the Escrow Mortgages and the Initial Mortgages. The amount of the
mortgagee's title insurance policy shall be for Sixty Two Million and
Five Hundred Thousand and 00/100 Dollars ($62,500,000.00) or such
lesser amount as Lenders may determine. All costs incurred by Lenders
shall be due and payable on demand. To the extent that such costs are
not immediately reimbursed by Borrower and Co-Obligors, such costs
shall bear interest at the Default Rate.
RESOLUTION OF DISPUTES.
(a) ARBITRATION. Any controversy or claim between or among the
parties to the Loan Documents or any related agreements or instruments,
including any claim based on or arising from an alleged tort, shall be
determined by binding arbitration in accordance with
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the Federal Arbitration Act (or if not applicable, the applicable state
law), the Rules of Practice and Procedure for the arbitration of
commercial disputes of Judicial Arbitration and Mediation Services,
Inc. (J.A.M.S.), and the "special rules" set forth below. In the event
of any inconsistency, the special rules shall control. Judgment upon
any arbitration award may be entered in any court having jurisdiction.
Any party to the Loan Documents may bring an action, including a
summary or expedited proceeding, to compel arbitration of any
controversy or claim to which this agreement applies in any court
having jurisdiction over such action.
(b) SPECIAL RULES. The arbitration shall be conducted in Palm
Beach County, Florida administered by J.A.M.S. who will appoint an
arbitrator; if J.A.M.S. is unable or legally precluded from
administering the arbitration, then the American Arbitration
Association will serve. All arbitration hearings will be commenced
within 90 days of the demand for arbitration; further, the arbitrator
shall only, upon a showing of cause, be permitted to extend the
commencement of such hearing for up to an additional 60 days.
(c) RESERVATIONS OF RIGHTS. Nothing in foregoing arbitration
shall be deemed to (i) limit the applicability of any otherwise
applicable statutes of limitation or repose and any waivers contained
in the Loan Documents; or (ii) be a waiver by Lenders of the protection
afforded to them by 12 U.S.C. Sec. 91 or any substantially equivalent
state law; or (iii) limit the rights of Lenders under the Loan
Documents (a) to exercise self help remedies such as (but not limited
to) set-off, or (b) to obtain from a court provisional or ancillary
remedies such as (but not limited to) injunctive relief, or the
appointment of a receiver. Lenders may exercise such self help rights,
or obtain such provisional or ancillary remedies before, during or
after the pendency of any arbitration proceeding brought pursuant to
the Loan Documents.
NOT PARTNERS; NO THIRD PARTY BENEFICIARIES. Nothing contained
herein or in any related document shall be deemed to render any Lender a partner
of Borrower and Co-Obligors for any purpose. This Agreement has been executed
for the sole benefit of Lenders, Borrower and Co-Obligors and no third party is
authorized to rely upon Lenders' rights hereunder or to rely upon an assumption
that Lenders have or will exercise their rights under this Agreement or under
any document referred to herein.
REGULATION U. Borrower and each Co-Obligor warrants that none
of the proceeds of the loan evidenced by the Note will be used to purchase or
carry "margin stock," as defined in Regulation U issued by the Federal Reserve
Board.
BUSINESS DAYS. If any payment date under the Revolving Loans
falls on a day that is not a Business Day of Agent, or if the last day of any
notice period falls on such a day, the payment shall be due and the notice
period shall end on the next succeeding Business Day of Agent.
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NOTICES. Any communications concerning this Agreement or the
credit described herein shall be addressed as follows:
As to Borrower and Co-Obligors:
5500 Village Boulevard
2nd Floor
West Palm Beach, Florida 33407
With a Copy to:
James F. Hadley, Esq.
6556 Carrietowne Lane East
Toledo, Ohio 43615
As to Agent and/or NationsBank :
NationsBank of Tennessee, N.A.
Attention: William Diehl
Commercial Lending
2nd Floor
One NationsBank Plaza
Nashville, Tennessee 37239
With a copy to:
NEAL & HARWELL, PLC
Attention: James R. Kelley
2000 First Union Tower
150 Fourth Avenue North
Nashville, Tennessee 37219-2498
As to Lender:
First Union National Bank
77 East Camino Real
Second Floor
Boca Raton, Florida 33432
With a copy to:
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Holland & Knight
701 Brickell Avenue
Miami, Florida 33131
Attention: Doug Darbut
Communications to be given to a party shall be effective when actually
or constructively received by such party or three (3) days after when set forth
in writing and mailed or delivered to such party's address stated above. Any
party may change its address for receipt of notices by submitting the change in
writing to the other party.
PARTICIPATIONS. Any Lender may, from time to time, in its sole
discretion, and without notice to Borrower and Co-Obligors, sell undivided
interest or participations in any credit subject hereto to such other investors
or financial institutions as it may elect, including the Federal Reserve Board.
Such participants will have no direct relationship with Borrower and Co-Obligors
and will have no right with respect to waivers or amendments or default
declarations. Any Lender may from time to time disclose to any participant or
prospective participant such information as the Lender may have regarding the
financial condition, operations, and prospects of Borrower and Co-Obligors, but
the Lender shall take reasonable precautions to require such participant or
prospective participant to keep such information confidential.
AGENT. The provisions of this Section 47 apply to the Lenders.
(a) APPOINTMENT. Each Lender hereby designates and appoints
NationsBank of Tennessee, N.A. as Agent of such Lender to act as
specified herein and the other Loan Documents, and each such Lender
hereby authorizes the Agent, as the agents for such Lender, to take
such action on its behalf under the provisions of this Agreement and
the other Loan Documents and to exercise such powers and perform such
duties as are expressly delegated by the terms hereof and of the other
Loan Documents, together with such other powers as are reasonably
incidental thereto. Notwithstanding any provision to the contrary
elsewhere herein and in the other Loan Documents, the Agent shall not
have any duties or responsibilities, except those expressly set forth
herein and therein, or any fiduciary relationship with a Lender, and no
implied covenants, functions, responsibilities, duties, obligations or
liabilities shall be read into this Agreement or any of the other Loan
Documents, or shall otherwise exist against the Agent. The provisions
of this Section are solely for the benefit of the Agent and the Lenders
and none of the Borrower and Co-Obligors shall not have any rights as a
third party beneficiary of the provisions hereof. In performing its
functions and duties under this Agreement and the other Loan Documents,
the Agent shall act solely as an agent of the Lenders and does not
assume and shall not be deemed to have assumed any obligation or
relationship of agency or trust with or for Borrower and Co-Obligors.
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(b) DELEGATION OF DUTIES. The Agent may execute any of its
duties hereunder or under the other Loan Documents by or through agents
or attorneys-in-fact and shall be entitled to advice of counsel
concerning all matters pertaining to such duties. The Agent shall not
be responsible for the negligence or misconduct of any agents or
attorneys-in-fact selected by it with reasonable care.
(c) EXCULPATORY PROVISIONS. Neither the Agent nor any of its
officers, directors, employees, agents, attorneys-in-fact or affiliates
shall be (a) liable for any action lawfully take or omitted to be taken
by it or such person under or in connection herewith or in connection
with any of the other Loan Documents (except for its or such person's
own gross negligence or willful misconduct) or (b) responsible in any
manner to any of the Lenders for any recitals, statements,
representations or warranties made by any of the Borrower and
Co-Obligors contained herein or in any of the other Loan Documents or
in any certificate, report, document, financial statement or other
written or oral statement referred to or provided for in, or received
by an Agent under or in connection herewith or in connection with the
other Loan Documents, or enforceability or sufficiency therefor of any
of the other Loan Documents, or for any failure of the Borrower and
Co-Obligors to perform their obligations hereunder or thereunder. The
Agent shall not be responsible to any Lender for the effectiveness,
genuineness, validity, enforceability, collectibility or sufficiency of
this Agreement, or any of the other Loan Documents or for any
representations, warranties, recitals or statements made herein or
therein or made by the Borrower and Co-Obligors in any written or oral
statement or in any financial or other statements, instruments,
reports, certificates or any other documents in connection herewith or
therewith furnished or made by the Agent to the Lenders or by or on
behalf of the Borrower and Co-Obligors to the Agent or any Lender or be
required to ascertain or inquire as to the performance or observance of
any of the terms, conditions, provisions, covenants or agreements
contained herein or therein or as to the use of the proceeds of the
Loans or of the existence or possible existence of any Default or Event
of Default or to inspect the properties, books or records of the
Borrower and Co-Obligors. The Agent is not a trustee for the Lenders
and owes no fiduciary duty to the Lenders.
(d) RELIANCE ON COMMUNICATIONS. The Agent shall be entitled to
rely, and shall be fully protected in relying, upon any note, writing,
resolution, notice, consent, certificate, affidavit, letter, cablegram,
telegram, telecopy, telex or teletype message, statement, order or
other document or conversation believed by it to be genuine and correct
and to have been signed, sent or made by the proper person or persons
and upon advice and statements of legal counsel (including, without
limitation, counsel to any of the Borrower and Co-Obligors, independent
accountants and other experts selected by the Agent with reasonable
care). The Agent may deem and treat the Lenders as the owner of its
interest hereunder for all purposes unless a written notice of
assignment, negotiation or transfer thereof shall have been filed with
the Agent. The Agent shall be fully justified in failing or refusing to
take any action
40
<PAGE> 41
under this Agreement or under any of the other Loan Documents unless it
shall first receive such advice or concurrence of the Required Lenders
as it deems appropriate or it shall first be indemnified to its
satisfaction by the Lenders against any and all liability and expense
which may be incurred by it by reason of taking or continuing to take
any such action. The Agent shall in all cases be fully protected in
acting, or in refraining from acting, hereunder or under any of the
other Loan Documents in accordance with a request of the Required
Lenders (or to the extent specifically provided in Section 51, all the
Lenders) and such request and any action taken or failure to act
pursuant thereto shall be binding upon all the Lenders (including their
successors and assigns).
(e) NOTICE OF DEFAULT. The Agent shall not be deemed to have
knowledge or notice of the occurrence of any Default or Event of
Default hereunder unless the Agent has received notice from a Lender or
Borrower or Co-Obligor referring to the Loan Document, describing such
Default or Event of Default and stating that such notice is a "notice
of default." In the event that the Agent receives such a notice, the
Agent shall give prompt notice thereof to the Lenders. The Agent shall
take such action with respect to such Default or Event of Default as
shall be reasonably directed by the Required Lenders.
(f) NON-RELIANCE ON AGENT AND OTHER LENDERS. Each Lender
expressly acknowledges that neither the Agent nor any of its officers,
directors, employees, agents, attorneys-in-fact or affiliates has made
any representations or warranties to it and that no act by the Agent or
any affiliate thereof hereinafter taken, including any review of the
affairs of Borrower and Co-Obligors, shall be deemed to constitute any
representation or warranty by the Agent to any Lender. Each Lender
represents to the Agent that it has, independently and without reliance
upon the Agent or any other Lender, and based on such documents and
information as it has deemed appropriate, made its own appraisal of and
investigation into the business, assets, operations, property,
financial and other conditions, prospects and creditworthiness of the
Borrower and Co-Obligors and made its own decision to make its Loans
hereunder and enter into this Agreement. Each Lender also represents
that it will, independently and without reliance upon the Agent or any
other Lender, and based on such documents and information as it shall
deem appropriate at the time, continue to make its own credit analysis,
appraisals and decisions in taking or not taking action under this
Agreement, and to make such investigation as it deems necessary to
inform itself as to the business, assets, operations, property,
financial and other conditions, prospects and creditworthiness of the
Borrower and Co-Obligors. Except for notices, reports and other
documents expressly required to be furnished to the Lenders by the
Agent hereunder, the Agent shall not have any duty or responsibility to
provide any Lender with any credit or other information concerning the
business, operations, assets, property, financial or other conditions,
prospects or creditworthiness of the Borrower and Co-Obligors which may
come into the possession of the Agent or any of its officers,
directors, employees, agents, attorneys-in-fact or affiliates.
41
<PAGE> 42
(g) INDEMNIFICATION. The Lenders agree to indemnify the Agent
in its capacity as such (to the extent not reimbursed by the Borrower
and without limiting the obligation of the Borrower to do so), ratably
according to their respective Commitments (or if the Commitments have
expired or been terminated, in accordance with the respective principal
amounts of outstanding Loans and Letters of Credit of the Lenders),
from and against any and all liabilities, obligations, losses, damages,
penalties, actions, judgments, suits, costs, expenses or disbursements
of any kind whatsoever which may at any time (including without
limitation at any time following payment in full of the Loans) be
imposed on, incurred by or asserted against the Agent in its capacity
as such in any way relating to or arising out of this Agreement or the
other Loan Documents or any documents contemplated by or referred to
herein or therein or the transactions contemplated hereby or thereby or
any action taken or omitted by the Agent under or in connection with
any of the foregoing; PROVIDED that no Lender shall be liable for the
payment of any portion of such liabilities, obligations, losses,
damages, penalties, actions, judgments, suits, costs, expenses or
disbursements resulting from the gross negligence or willful misconduct
of the Agent. If any indemnity furnished to the Agent for any purpose
shall, in the opinion of the Agent, be insufficient or become impaired,
the Agent may call for additional indemnity and cease, or not commence,
to do the acts indemnified against until such additional indemnity is
furnished. The agreements in this Section shall survive the payment of
the Loans and all other amounts payable hereunder and under the other
Loan Documents.
(h) AGENT IN ITS INDIVIDUAL CAPACITY. The Agent and its
affiliates may make loans to, accept deposits from and generally engage
in any kind of business with the Borrower and Co-Obligors as though the
Agent were not the Agent hereunder. With respect to the Loans made and
all obligations owing to it, the Agent shall have the same rights and
powers under this Loan Agreement as any Lender and may exercise the
same as though it was not the Agent, and the terms "Lender" and
"Lenders" shall include the Agent in its individual capacity.
(i) SUCCESSOR AGENT. The Agent may, at any time, resign upon
20 days written notice to the Lenders. Upon any such resignation, the
Required Lenders shall have the right to appoint a successor Agent. If
no successor Agent shall have been so appointed by the Required
Lenders, and shall have accepted such appointment, within 45 days after
the notice of resignation, then the retiring Agent shall select a
successor Agent provided such successor is a Lender hereunder or a
commercial bank organized under the laws of the United States of
America or of any State thereof and has a combined capital and surplus
of at least $400,000,000. Upon the acceptance of any appointment as the
Agent hereunder by a successor, 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 as an Agent, as appropriate,
under this Agreement and other Loan Documents and the provisions of
this Section shall inure to its benefit as to
42
<PAGE> 43
any actions taken or omitted to be taken by it while it was the Agent
under this Agreement.
(j) SHARING OF PAYMENTS. Any Lender or holder of any Note
having a right to set off shall, to the extent the amount of any such
set off exceeds its pro rata share of the amount set off, purchase for
cash (and the other Lender or holders shall sell) interests in each
such other Lender's or holder's pro rata share of the Loans as would be
necessary to cause such Lender to share such excess with each other
Lender or holder in accordance with their respective pro rata shares.
If any Lender should receive a payment on account of any Term or
Renewal Term Note at a time when the other Lender does not receive a
payment on its Term or Renewal Term Note, then the Lender receiving
such payment shall purchase for cash (and the other Lender shall sell)
an interest in each such other Lender's pro rata share of the Term or
Renewal Term Note as will be necessary to cause such Lender to share
such excess with each other Lender in accordance with their respective
pro rata shares.
INCORPORATION OF EXHIBITS AND SCHEDULES. All Exhibits and
Schedules referred to in this Agreement are incorporated herein by this
reference.
INDULGENCE NOT WAIVER. Lenders' indulgence in the existence of
a default hereunder or any other departure from the terms of this Agreement
shall not prejudice Lenders' rights to declare a default or otherwise demand
strict compliance with this Agreement.
CUMULATIVE REMEDIES. The remedies provided Lenders in this
Agreement are not exclusive of any other remedies that may be available to
Lenders under any other document or at law or equity.
AMENDMENTS, WAIVER AND CONSENTS. Neither this Agreement nor
any other Loan Documents nor any of the terms hereof or thereof may be amended,
changed, waived, discharged or terminated unless such amendment, change, waiver,
discharge or termination is in writing and signed by the Required Lenders and
the Borrower and Co-Obligors; PROVIDED that no such amendment, change, waiver,
discharge or termination shall
(a) without the consent of each Lender affected thereby,
(i) extend the final maturity of any Loan, or
extend or waive any principal amortization payment of any
Loan, or any portion thereof;
(ii) reduce the rate or extend the time of payment of
interest (other than as a result of waiving the applicability
of any post-default increase in interest rates) thereon or
fees hereunder;
(iii) reduce or waive the principal amount of any
Loan;
43
<PAGE> 44
(iv) increase the Commitment of a Lender over the
amount thereof in effect (it being understood and agreed that
a waiver of any Default or Event of Default or mandatory
reduction in the Commitments shall not constitute a change in
the terms of any Commitment of any Lender);
(v) Except as set forth in this Agreement, release
all or substantially all of the Collateral securing the Loans
hereunder;
(vi) release the Borrower or a Co-Obligor from its
obligations under the Loan Documents;
(vii) reduce any percentage specified in, or
otherwise modify, the definition of Required Lenders; or
(viii) consent to the assignment or transfer by the
Borrower or a Co-Obligor of any of its rights and obligations
under (or in respect of) the Loan Documents; and
(b) no provision of Section 47 may be amended without the
consent of the Agent;
(c) notwithstanding the fact that the consent of all the
Lenders is required in certain circumstances as set forth above, (i)
each Lender is entitled to vote as such Lender sees fit on any
bankruptcy reorganization plan that affects the Loans or the Letters of
Credit, and each Lender acknowledges that the provisions of Section
1126(c) of the Bankruptcy Code supersedes the unanimous consent
provision set forth herein and (ii) the Required Lenders may consent to
allow the Borrower and Co-Obligors to use cash collateral in the
context of a bankruptcy or insolvency proceeding.
ASSIGNMENT. This Agreement shall be binding upon and inure to
the benefit of the respective heirs, successors and assigns of Borrower and
Co-Obligors, Agent and Lenders, except that Borrower and Co-Obligors shall not
assign any rights or delegate any obligations arising hereunder without the
prior written consent of Lenders. Any attempted assignment or delegation by
Borrower and Co-Obligors without the required prior consent shall be void.
ENTIRE AGREEMENT. This Agreement and the other written
agreements between Borrower, Co-Obligors, Agent and Lenders represent the entire
agreement between the parties concerning the subject matter hereof, and all oral
discussions and prior agreements are merged herein.
SEVERABILITY. Should any provision of this Agreement be
invalid or unenforceable for any reason, the remaining provisions hereof shall
remain in full effect.
44
<PAGE> 45
TIME OF ESSENCE. Time is of the essence of this Agreement, and
all dates and time periods specified herein shall be strictly observed, except
that Lenders may permit specific deviations therefrom by their written consent.
APPLICABLE LAW. Except to the extent set forth in any of the
Collateral Documents, the validity, construction and enforcement of this
Agreement and all other documents executed with respect to the Loans shall be
determined according to the laws of Tennessee applicable to contracts executed
and performed entirely within that state, in which state this Agreement has been
executed and delivered.
GENDER AND NUMBER. Words used herein indicating gender or
number shall be read as context may require.
CAPTIONS NOT CONTROLLING. Captions and headings have been
included in this Agreement for the convenience of the parties, and shall not be
construed as affecting the content of the respective paragraphs.
Executed the date first written above.
THE UNDERSIGNED ACKNOWLEDGE A
THOROUGH UNDERSTANDING OF THE
TERMS OF THIS AGREEMENT AND AGREE
TO BE BOUND THEREBY:
LENDERS:
NATIONSBANK OF TENNESSEE, N.A.
By: /s/ William H. Diehl
-----------------------------------
Title: Senior Vice President
--------------------------------
FIRST UNION NATIONAL BANK
By: /s/ Deborah Flack
-----------------------------------
Title: Senior Vice President
--------------------------------
45
<PAGE> 46
AGENT:
NATIONSBANK OF TENNESSEE, N.A.
By: /s/ William H. Diehl
-------------------------------------
Title: Senior Vice President
----------------------------------
BORROWER:
COOKER RESTAURANT CORPORATION,
an Ohio corporation
By: /s/ Mark W. Mikosz
-------------------------------------
Title: Vice President, Chief Financial
Officer
----------------------------------
CO-OBLIGORS:
CGR MANAGEMENT CORPORATION,
a Florida corporation
By: /s/ Mark W. Mikosz
-------------------------------------
Title: Vice President
----------------------------------
FLORIDA COOKER, LP, INC.,
a Florida corporation
By: /s/ Mark W. Mikosz
-------------------------------------
Title: Vice President
----------------------------------
46
<PAGE> 47
SOUTHERN COOKER LIMITED
PARTNERSHIP, an Ohio limited partnership
By: COOKER RESTAURANT
CORPORATION, General Partner
By: /s/ Mark W. Mikosz
-------------------------------------
Title: Vice President
----------------------------------
47
<PAGE> 48
EXHIBITS
--------
A 19 PROPERTIES
B 11 PROPERTIES
C EXISTING LIENS
D REVOLVING NOTE FORM
E TERM NOTE FORM
F NOTICE OF BORROWING
G RENEWAL REVOLVING NOTE FORM
H RENEWAL TERM NOTE FORM
I FORM OF GENERAL AND LOCAL COUNSEL
OPINIONS
J LITIGATION
K FIRST UNION MORTGAGES
L CIT LOAN TERMS
M FIRST UNION PRINCIPAL PAYMENTS
48
<PAGE> 49
ANNEX 1
<TABLE>
<S> <C>
107 Hermitage Cooker Owned
4770 Lebanon Road 6,100
Hermitage, TN 37076 Opened: 4/5/84
615-883-9700 Seats: 188
112 Cleveland Ave. Cooker Owned
6193 Cleveland Avenue 7,800
Columbus, OH 43229 Opened: 12/06/87
614-899-7000 Seats: 226
117 East Main Cooker Owned
5225 East Main Street 7,240
Columbus, OH 43213-2503 Opened: 8/12/90
614-759-6700 Seats: 220
120 Dayton Cooker Owned
1383 Miamisburg-Centerville Rd. 7,700
Dayton, OH 45459-3852 Opened: 11/17/91
513-439-4660 Seats: 243
124 Westlake Cooker Owned
857 Columbia Road 6,700
Westlake, OH 44145-1427 Opened: 11/1/92
216-899-9494 Seats: 210
129 Springdale Cooker Owned
11333 Princeton Pike 9,433
Springdale, OH 45246-3201 Opened: 5/23/93
513-772-4546 Seats: 286
132 Toledo Cooker Owned
5628 Airport Highway 7,200
Holland, OH 43528 Opened: 10/31/93
419-867-4994 Seats: 242
148 Vandalia Cooker Owned
7580 Poe Avenue 9,039
Dayton, OH 45414 Opened: 5/20/96
513-454-1100 Seats: 292
110 Parkway Cooker Owned
1211 Murfreesboro Road 7,200
Nashville, TN 37217-2400 Opened: 12/9/86
615-361-4747 Seats: 220
114 Rivergate Cooker Owned
317 Bluebird Lane 8,100
Goodlettsville, TN 37072-2303 Opened:
615-859-2756 10/24/88
Seats: 255
118 Cincinnati Cooker Owned
8850 Governor's Hill Drive 9,100
Cincinnati, OH 45249-1337 Opened:02/02/90
513-677-3100 254
122 Auburn Hills Cooker Owned
3773 East Walton Boulevard 8,200
Auburn Hills, MI 48326-2237 Opened: 5/31/92
810-373-5050 Seats: 252
126 North High Cooker Owned
8360 North High Street 8,200
Columbus, OH 43235-6403 Opened:
614-438-5800 12/20/92
Seats: 252
130 Novi Cooker Owned
39581 12 Mile Road 7,200
Novi, MI 48377 Opened: 10/3/93
810-380-2600 Seats: 242
144 Solon Cooker Owned
6150 SOM Center Road 7,200
Solon, OH 44139 Opened:
216-519-9800 11/18/95
Seats: 240
150 Beavercreek Cooker Owned
2819 Centre Drive 7,667
Beavercreek, OH 45431 Opened: 6/13/96
513-427-4700 Seats: 240
</TABLE>
<PAGE> 50
<TABLE>
<S> <C>
151 Sterling Heights Cooker Owned
14425 Lakeside Circle 9,169
Sterling Heights, MI 48313 Opened: 6/24/96
810-566-9597 Seats: 280
156 Saginaw Cooker Owned
3870 Bay Road 9,169
Saginaw, MI 48603 Opened: 02/17/97
517-249-8570 Seats: 296
159 Beechmont Owned
8600 Beechmont 9,036
Cincinnati, OH 45225 Opened: 3/17/97
513-474-1299 Seats: 296
164 Canton Owned
41980 Ford Road 8,590
Canton, MI 48187-3647 Opened: 8/11/97
313-981-6595 Seats: 284
171 Troy Owned
5460 Corporate Dr. 7755
Troy, MI 48098 Opened: 3/23/98
248-952-5801 Seats: 266
152 Boardman Cooker Owned
1247 Boardman Poland Road 9,036
Boardman, OH 44514 Opened:
330-629-6161 07/01/96
Seats: 292
157 Grand Rapids Owned
3050 Alpine Road 9,036
Walker, MI 49504 Opened: 3/3/97
616-785-3242 Seats: 284
162 Mentor Owned
7787 Reynolds Road 7,755
Mentor, OH 44060-5320 Opened: 8/25/97
440-269-8480 Seats: 266
165 Cuyahoga Falls Owned
283 Howe Ave. 7,050
Cuyahoga Falls, OH 44221- Opened: 12/15/97
4915 Seats: 266
330-929-2322
</TABLE>
<PAGE> 51
ANNEX 2
<TABLE>
<S> <C>
127 Willow Lake Cooker Owned
2801 Lake Circle Drive 7,865
Indianapolis, IN 46268- Opened: 3/14/93
4205 Seats: 262
317-471-1111
134 Raleigh Cooker Owned
4516 Falls of Neuse Road 7,200
Raleigh, NC 27609 Opened: 12/12/93
919-981-7400 Seats: 242
146 Murfreesboro Cooker Owned
730 N.W. Broad St. 7,667
Murfreesboro, TN 37219 Opened: 3/2/96
615-895-6400 Seats: 234
149 Town Center Cooker Owned
790 Cobb Place Boulevard 9,036
Kennesaw, GA 30144 Opened: 5/27/96
770-424-2925 Seats: 292
161 Chattanooga Owned
2225 Gunbarrell Road 7,067
Chattanooga, TN 37421 Opened: 6/23/97
423-954-3020 Seats: 224
172 Augusta Owned
276 Robert C. Daniel Jr. 7755
Parkway Opened: 3/18/98
Augusta, GA 30909 Seats: 266
706-737-2600
133 East Memphis Cooker Owned
6980 Winchester Road 7,200
Memphis, TN 38115 Opened: 10/31/93
901-367-1999 Seats: 242
135 Fairlakes Cooker Owned
12950 Fair Lakes Shopping Ctr 7,200
Fairfax, VA 22003 12/19/93
703-802-1050 242
147 Gwinnett Cooker Owned
1590 Pleasant Hill Road 9,169
Duluth, GA 30136 Opened: 05/06/96
770-717-5020 288
158 Chesapeake Owned
628 Jarman Road 7,800
Chesapeake, VA 23320 Opened: 3/17/97
757-424-7800 Seats: 240
176 Knoxville Cooker Owned
106 Major Reynolds Road 7,755
Knoxville, TN 37919 Opened: 09/15/98
423-330-0202 Seats: 266
</TABLE>
<PAGE> 52
EXHIBIT K
---------
FIRST UNION MORTGAGES
1. Unit 117 - Columbus, Ohio
2. Unit 112 - Columbus, Ohio
3. Unit 107 - Hermitage, Tennessee
4. Unit 110 - Nashville, Tennessee
5. Unit 114 - Goodlettsville, Tennessee
6. Unit 118 - Cincinnati, Ohio
<PAGE> 53
REVOLVING LOAN NOTE
Date: September 24, 1998 Amount: $ 10,000,000.00
<TABLE>
<CAPTION>
=============================================================================================
BANK: BORROWER:
<S> <C>
NationsBank of Tennessee, N.A. Cooker Restaurant Corporation
Commercial Lending - 2nd Floor 5500 Village Blvd. - 2nd Floor
One NationsBank Plaza West Palm Beach, Palm Beach County, FL
Nashville, Davidson County, TN 37239 33407
CO-OBLIGORS:
CGR
Management Corporation
5500 Village Blvd. - 2nd Floor
West Palm Beach, FL 33407
Florida Cooker LP, Inc.
5500 Village Blvd. - 2nd Floor
West Palm Beach, FL 33407
Southern Cooker Limited Partnership
5500 Village Blvd. - 2nd Floor
West Palm Beach, FL 33407
=============================================================================================
</TABLE>
FOR VALUE RECEIVED, the undersigned Borrower and Co-Obligors, jointly and
severally, unconditionally promise to pay to the order of Bank, its successors
and assigns, without setoff, at its offices indicated at the beginning of this
Note, or at such other place as may be designated by Bank, the principal amount
of Ten Million and 00/100 Dollars ($10,000,000.00), or so much thereof as may be
advanced from time to time in immediately available funds, together with
interest computed daily on the outstanding principal balance hereunder, at an
annual interest rate, and in accordance with the payment schedule, indicated
below. This Note is the Revolving Note made pursuant to that Loan Agreement of
even date herewith between Borrower, Co-Obligors and NationsBank of Tennessee,
N.A., as Agent for itself and First Union National Bank ("Loan Agreement").
Capitalized terms not defined herein shall have the meaning contained in the
Loan Agreement.
1. RATE. The rate shall be as provided in the Loan Agreement.
Notwithstanding any provision of this Note, Bank does not intend to charge and
Borrower and Co- Obligors shall not be required to pay any amount of interest or
other charges in excess of the maximum permitted by the applicable law of the
State of Tennessee; if any higher rate ceiling is lawful, then that higher rate
ceiling shall apply. Any payment in excess of such maximum shall be refunded to
Borrower and Co-Obligors or credited against principal, at the option of Bank.
<PAGE> 54
2. ACCRUAL METHOD. Interest at the Rate set forth above will be calculated by
the 365/360 day method (a daily amount of interest is computed for a
hypothetical year of 360 days; that amount is multiplied by the actual number of
days for which any principal is outstanding hereunder).
3. PAYMENT SCHEDULE. All payments received hereunder shall be applied first to
the payment of any expense or charges payable hereunder or under any other loan
documents executed in connection with this Note, then to interest due and
payable, with the balance applied to principal, or in such other order as Bank
shall determine at its option.
Payments shall be made on the dates and in the amounts set forth in the Loan
Agreement. The maturity date of this Note is March 24, 2004, subject to the
provisions of Section 5 of the Loan Agreement.
4. ADVANCES. This is a revolving note. Advances to Borrower and Co-Obligors
shall be made in accordance with the terms of the Loan Agreement.
5. WAIVERS, CONSENTS AND COVENANTS. Subject to any applicable cure periods,
Borrower and Co-Obligors, any indorser or guarantor hereof, or any other party
hereto (individually an "Obligor" and collectively "Obligors") and each of them
jointly and severally: (a) waive presentment, demand, protest, notice of demand,
notice of intent to accelerate, notice of acceleration of maturity, notice of
protest, notice of nonpayment, notice of dishonor, and any other notice required
to be given under the law to any Obligor in connection with the delivery,
acceptance, performance, default or enforcement of this Note, any indorsement or
guaranty of this Note, or any other documents executed in connection with this
Note or any other note or other loan documents now or hereafter executed in
connection with any obligation of Borrower and Co-Obligors to Bank (the "Loan
Documents"); (b) consent to all delays, extensions, renewals or other
modifications of this Note or the Loan Documents, or waivers of any term hereof
or of the Loan Documents, or release or discharge by Bank of any of Obligors, or
release, substitution or exchange of any security for the payment hereof, or the
failure to act on the part of Bank, or any indulgence shown by Bank (without
notice to or further assent from any of Obligors), and agree that no such
action, failure to act or failure to exercise any right or remedy by Bank shall
in any way affect or impair the obligations of any Obligors or be construed as a
waiver by Bank of, or otherwise affect, any of Bank's rights under this Note,
under any indorsement or guaranty of this Note or under any of the Loan
Documents; and (c) agree to pay, on demand, all reasonable costs and expenses of
collection or defense of this Note or of any indorsement or guaranty hereof
and/or the enforcement or defense of Bank's rights with respect to, or the
administration, supervision, preservation, or protection of, or realization
upon, any property securing payment hereof, including, without limitation,
reasonable attorney's fees, including fees related to any suit, mediation or
arbitration proceeding, out of court payment agreement, trial, appeal,
bankruptcy proceedings or other proceeding, in such amount as may be determined
reasonable by any arbitrator or court, whichever is applicable.
6. PREPAYMENTS. Voluntary prepayments of principal or accrued interest may be
made, in whole or in part, at any time without penalty, except, in the case of a
LIBOR Rate borrowing, a payment prior to the end of the LIBOR Period will
require Borrower and Co-Obligors to pay Bank any
2
<PAGE> 55
breakage costs associated with such prepayment.
7. DELINQUENCY CHARGE. To the extent permitted by law, a delinquency charge may
be imposed in an amount not to exceed four percent (4%) of any payment that is
more than fifteen days late.
8. EVENTS OF DEFAULT. The following are events of default hereunder: subject to
any applicable notice or cure period, (a) the failure to pay any obligation,
liability or indebtedness of any Obligor to Bank, whether under this Note, the
Loan Agreement or any Loan Documents, within five (5) days of the date when due
(whether upon demand, at maturity or by acceleration) provided, however, that
Borrower and Co-Obligors shall not be in Default as a result of a missed
interest payment if a Lender has failed to deliver to Borrower an interest
statement for such payment; (b) a Default as defined in the Loan Agreement.
9. REMEDIES UPON DEFAULT. Whenever there is a default under this Note (a) the
entire balance outstanding hereunder and all other obligations of any Obligor to
Bank (however acquired or evidenced) shall, at the option of Bank, become
immediately due and payable and any obligation of Bank to permit further
borrowing under this Note shall immediately cease and terminate, and/or (b) to
the extent permitted by law, the Rate of interest on the unpaid principal shall
be increased to the Default Rate as defined in the Loan Agreement. The
provisions herein for a Default Rate shall not be deemed to extend the time for
any payment hereunder or to constitute a "grace period" giving Obligors a right
to cure any default. At Bank's option, and to the extent permitted by law, any
accrued and unpaid interest, fees or charges may, for purposes of computing and
accruing interest on a daily basis after the due date of the Note or any
installment thereof, be deemed to be a part of the principal balance, and
interest shall accrue on a daily compounded basis after such date at the Default
Rate provided in this Note until the entire outstanding balance of principal and
interest is paid in full. Upon a default under this Note, Bank is hereby
authorized at any time, at its option and without notice or demand, to set off
and charge against any deposit accounts of any Obligor, (as well as any money,
instruments, securities, documents, chattel paper, credits, claims, demands,
income and any other property, rights and interests of any Obligor), which at
any time shall come into the possession or custody or under the control of Bank
or any of its agents, affiliates or correspondents, any and all obligations due
hereunder. Additionally, Bank shall have all rights and remedies available under
each of the Loan Documents, as well as all rights and remedies available at law
or in equity.
10. NON-WAIVER. The failure at any time of Bank to exercise any of its options
or any other rights hereunder shall not constitute a waiver thereof, nor shall
it be a bar to the exercise of any of its options or rights at a later date. All
rights and remedies of Bank shall be cumulative and may be pursued singly,
successively or together, at the option of Bank. The acceptance by Bank of any
partial payment shall not constitute a waiver of any default or of any of Bank's
rights under this Note. No waiver of any of its rights hereunder, and no
modification or amendment of this Note, shall be deemed to be made by Bank
unless the same shall be in writing, duly signed on behalf of Bank; each such
waiver shall apply only with respect to the specific instance involved, and
shall in no way impair the rights of Bank or the obligations of Obligors to Bank
in any other respect at any other time.
3
<PAGE> 56
11. APPLICABLE LAW, VENUE AND JURISDICTION. This Note and the rights and
obligations of Borrower, Co-Obligors and Bank under this Note shall be governed
by and interpreted in accordance with the law of the State of Tennessee. Except
for proceedings to enforce any mortgage, deed of trust, security agreement or
other collateral document, in any litigation in connection with or to enforce
this Note or any indorsement or guaranty of this Note or any Loan Documents,
Obligors, and each of them, irrevocably consent to and confer personal
jurisdiction on the courts of the State of Tennessee or the United States
located within the State of Tennessee and expressly waive any objections as to
venue in any such courts. Nothing contained herein shall, however, prevent Bank
from bringing any action or exercising any rights within any other state or
jurisdiction or from obtaining personal jurisdiction by any other means
available under applicable law.
12. PARTIAL INVALIDITY. The unenforceability or invalidity of any provision of
this Note shall not affect the enforceability or validity of any other provision
herein and the invalidity or unenforceability of any provision of this Note or
of the Loan Documents to any person or circumstance shall not affect the
enforceability or validity of such provision as it may apply to other persons or
circumstances.
13. BINDING EFFECT. This Note shall be binding upon and inure to the benefit of
Borrower, Co-Obligors, Obligors and Bank and their respective successors,
assigns, heirs and personal representatives, provided, however, that no
obligations of Borrower, Co-Obligors or Obligors hereunder can be assigned
without prior written consent of Bank.
14. CONTROLLING DOCUMENT. To the extent that this Note conflicts with or is in
any way incompatible with any other document related specifically to the loan
evidenced by this Note, this Note shall control over any other such document
except the Loan Agreement, and if this Note does not address an issue, then each
other such document shall control to the extent that it deals most specifically
with an issue.
15. ARBITRATION. ANY CONTROVERSY OR CLAIM BETWEEN OR AMONG THE PARTIES HERETO
INCLUDING BUT NOT LIMITED TO THOSE ARISING OUT OF OR RELATING TO THIS
INSTRUMENT, AGREEMENT OR DOCUMENT OR ANY RELATED INSTRUMENTS, AGREEMENTS OR
DOCUMENTS, INCLUDING ANY CLAIM BASED ON OR ARISING FROM AN ALLEGED TORT, SHALL
BE DETERMINED BY BINDING ARBITRATION IN ACCORDANCE WITH THE FEDERAL ARBITRATION
ACT (OR IF NOT APPLICABLE, THE APPLICABLE STATE LAW), THE RULES OF PRACTICE AND
PROCEDURE FOR THE ARBITRATION OF COMMERCIAL DISPUTES OF J.A.M.S./ENDISPUTE OR
ANY SUCCESSOR THEREOF ("J.A.M.S."), AND THE "SPECIAL RULES" SET FORTH BELOW. IN
THE EVENT OF ANY INCONSISTENCY, THE SPECIAL RULES SHALL CONTROL. JUDGMENT UPON
ANY ARBITRATION AWARD MAY BE ENTERED IN ANY COURT HAVING JURISDICTION. ANY PARTY
TO THIS INSTRUMENT, AGREEMENT OR DOCUMENT MAY BRING AN ACTION, INCLUDING A
SUMMARY OR EXPEDITED PROCEEDING, TO COMPEL ARBITRATION OF ANY CONTROVERSY OR
CLAIM TO WHICH THIS AGREEMENT APPLIES IN ANY COURT HAVING JURISDICTION OVER SUCH
4
<PAGE> 57
ACTION.
A. SPECIAL RULES. THE ARBITRATION SHALL BE CONDUCTED IN PALM BEACH COUNTY,
FLORIDA, AND ADMINISTERED BY J.A.M.S. WHO WILL APPOINT AN ARBITRATOR; IF
J.A.M.S. IS UNABLE OR LEGALLY PRECLUDED FROM ADMINISTERING THE ARBITRATION, THEN
THE AMERICAN ARBITRATION ASSOCIATION WILL SERVE. ALL ARBITRATION HEARINGS WILL
BE COMMENCED WITHIN 90 DAYS OF THE DEMAND FOR ARBITRATION; FURTHER, THE
ARBITRATOR SHALL ONLY, UPON A SHOWING OF CAUSE, BE PERMITTED TO EXTEND THE
COMMENCEMENT OF SUCH HEARING FOR UP TO AN ADDITIONAL 60 DAYS.
B. RESERVATION OF RIGHTS. NOTHING IN THIS ARBITRATION PROVISION SHALL BE
DEEMED TO (I) LIMIT THE APPLICABILITY OF ANY OTHERWISE APPLICABLE STATUTES OF
LIMITATION OR REPOSE AND ANY WAIVERS CONTAINED IN THIS INSTRUMENT, AGREEMENT OR
DOCUMENT; OR (II) BE A WAIVER BY BANK OF THE PROTECTION AFFORDED TO IT BY 12
U.S.C. SEC. 91 OR ANY SUBSTANTIALLY EQUIVALENT STATE LAW; OR (III) LIMIT THE
RIGHT OF BANK HERETO (A) TO EXERCISE SELF HELP REMEDIES SUCH AS (BUT NOT LIMITED
TO) SETOFF, OR (B) TO FORECLOSE AGAINST ANY REAL OR PERSONAL PROPERTY
COLLATERAL, OR (C) TO OBTAIN FROM A COURT PROVISIONAL OR ANCILLARY REMEDIES SUCH
AS (BUT NOT LIMITED TO) INJUNCTIVE RELIEF, WRIT OF POSSESSION OR THE APPOINTMENT
OF A RECEIVER. BANK MAY EXERCISE SUCH SELF HELP RIGHTS, FORECLOSE UPON SUCH
PROPERTY, OR OBTAIN SUCH PROVISIONAL OR ANCILLARY REMEDIES BEFORE, DURING OR
AFTER THE PENDENCY OF ANY ARBITRATION PROCEEDING BROUGHT PURSUANT TO THIS
INSTRUMENT, AGREEMENT OR DOCUMENT. NEITHER THIS EXERCISE OF SELF HELP REMEDIES
NOR THE INSTITUTION OR MAINTENANCE OF AN ACTION FOR FORECLOSURE OR PROVISIONAL
OR ANCILLARY REMEDIES SHALL CONSTITUTE A WAIVER OF THE RIGHT OF ANY PARTY,
INCLUDING THE CLAIMANT IN ANY SUCH ACTION, TO ARBITRATE THE MERITS OF THE
CONTROVERSY OR CLAIM OCCASIONING RESORT TO SUCH REMEDIES.
NOTICE OF FINAL AGREEMENT. THIS WRITTEN PROMISSORY NOTE
REPRESENTS THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT
BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR
SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO
UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.
COOKER RESTAURANT
CORPORATION CGR MANAGEMENT CORPORATION
By: /s/ Mark W. Mikosz By: /s/ Mark W. Mikosz
-------------------------------- --------------------------------
5
<PAGE> 58
Its: Vice President, Chief Financial Its: Vice President
Officer -------------------------------
-------------------------------
SOUTHERN COOKER LIMITED
FLORIDA COOKER LP, INC. PARTNERSHIP
By: Cooker Restaurant Corporation,
By: /s/ Mark W. Mikosz General Partner
--------------------------------
Its: Vice President By /s/ Mark W. Mikosz
-------------------------------- ---------------------------------
Its: Vice President
-------------------------------
6
<PAGE> 59
STATE OF TENNESSEE )
)
COUNTY OF DAVIDSON )
Before me, the undersigned, a Notary Public of the state and county
aforesaid, personally appeared Mark Mikosz, with whom I am personally
acquainted, and who, upon oath, acknowledged himself to be the VP, CFO of COOKER
RESTAURANT CORPORATION, the within named bargainor, a corporation, and that he,
as such VP, CFO, being authorized so to do, executed the foregoing instrument
for the purposes therein contained, by signing the name of the corporation by
himself as VP, CFO.
Witness my hand and seal at office in Nashville, Tennessee, this 24th
day of September, 1998.
/s/ Mittie Jean Compton
-----------------------------
Notary Public
My Commission Expires:
11-27-99
- ---------------------
STATE OF TENNESSEE )
)
COUNTY OF DAVIDSON )
Before me, the undersigned, a Notary Public of the state and county
aforesaid, personally appeared Mark Mikosz, with whom I am personally
acquainted, and who, upon oath, acknowledged himself to be the VP of CGR
MANAGEMENT CORPORATION, the within named bargainor, a corporation, and that he,
as such VP, being authorized so to do, executed the foregoing instrument for the
purposes therein contained, by signing the name of the corporation by himself as
VP.
Witness my hand and seal at office in Nashville, Tennessee, this 24th
day of September, 1998.
/s/ Mittie Jean Compton
-----------------------------
Notary Public
My Commission Expires:
11-27-99
- ---------------------
7
<PAGE> 60
STATE OF TENNESSEE )
)
COUNTY OF DAVIDSON )
Before me, the undersigned, a Notary Public of the state and county
aforesaid, personally appeared Mark Mikosz, with whom I am personally
acquainted, and who, upon oath, acknowledged himself to be the VP of FLORIDA
COOKER LP, INC., the within named bargainor, a corporation, and that he, as such
VP, being authorized so to do, executed the foregoing instrument for the
purposes therein contained, by signing the name of the corporation by himself as
VP.
Witness my hand and seal at office in Nashville, Tennessee, this 24th
day of September, 1998.
/s/ Mittie Jean Compton
-----------------------------
Notary Public
My Commission Expires:
11-27-99
- ---------------------
STATE OF TENNESSEE )
)
COUNTY OF DAVIDSON )
Before me, the undersigned, a Notary Public of the state and county
aforesaid, personally appeared Mark Mikosz, with whom I am personally
acquainted, and who, upon oath, acknowledged himself to be the VP of COOKER
RESTAURANT CORPORATION, the general partner of SOUTHERN COOKER LIMITED
PARTNERSHIP, the within named bargainor, a limited partnership, and that he, as
such VP, being authorized so to do, executed the foregoing instrument for the
purposes therein contained, by signing the name of the corporation by himself as
VP.
Witness my hand and seal at office in Nashville, Tennessee, this 24th
day of September, 1998.
/s/ Mittie Jean Compton
-----------------------------
Notary Public
My Commission Expires:
11-27-99
- ---------------------
8
<PAGE> 61
TERM LOAN NOTE
<TABLE>
Date: September 24, 1998 Amount: $ 30,000,000.00
===========================================================================================
<S> <C>
BANK:NationsBank of Tennessee, BORROWER:Cooker Restaurant
N.A.Commercial Lending - 2nd FloorOne Corporation5500 Village Blvd. - 2nd
NationsBank PlazaNashville, Davidson FloorWest Palm Beach, Palm Beach County,
County, TN 37239 FL 33407CO-OBLIGORS:
CGR Management Corporation5500 Village
Blvd. - 2nd FloorWest Palm Beach, FL
33407Florida Cooker LP, Inc.5500 Village
Blvd. - 2nd FloorWest Palm Beach, FL
33407Southern Cooker Limited
Partnership5500 Village Blvd. - 2nd
FloorWest Palm Beach, FL 33407
===========================================================================================
</TABLE>
FOR VALUE RECEIVED, the undersigned Borrower and Co-Obligors, jointly and
severally, unconditionally promise to pay to the order of Bank, its successors
and assigns, without setoff, at its offices indicated at the beginning of this
Note, or at such other place as may be designated by Bank, the principal amount
of Thirty Million and 00/100 Dollars ($30,000,000.00), or so much thereof as may
be advanced from time to time in immediately available funds, together with
interest computed daily on the outstanding principal balance hereunder, at an
annual interest rate, and in accordance with the payment schedule, indicated
below. This Note is one of the Term Loan Notes made pursuant to that Loan
Agreement of even date herewith between Borrower, Co-Obligors and NationsBank of
Tennessee, N.A., as Agent for itself and First Union National Bank ("Loan
Agreement"). Capitalized terms not defined herein shall have the meaning
contained in the Loan Agreement.
1. RATE. The rate shall be as provided in the Loan Agreement.
Notwithstanding any provision of this Note, Bank does not intend to charge and
Borrower and Co-Obligors shall not be required to pay any amount of interest or
other charges in excess of the maximum permitted by the applicable law of the
State of Tennessee; if any higher rate ceiling is lawful, then that higher rate
ceiling shall apply. Any payment in excess of such maximum shall be refunded to
Borrower and Co-Obligors or credited against principal, at the option of Bank.
2. ACCRUAL METHOD. Interest at the Rate set forth above will be calculated by
the 365/360 day method (a daily amount of interest is computed for a
hypothetical year of 360 days; that amount is multiplied by the actual number of
days for which any principal is outstanding hereunder).
3. PAYMENT SCHEDULE. All payments received hereunder shall be applied first to
the payment of any expense or charges payable hereunder or under any other loan
documents executed in connection with this Note, then to interest due and
payable, with the balance applied to principal, or in such other order as Bank
shall determine at its option.
Payments shall be made on the dates and in the amounts set forth in the Loan
Agreement. The maturity date of this Note is March 24, 2004, subject to the
provisions of Section 5 of the Loan Agreement.
<PAGE> 62
4. WAIVERS, CONSENTS AND COVENANTS. Subject to any applicable cure periods,
Borrower and Co-Obligors, any indorser or guarantor hereof, or any other party
hereto (individually an "Obligor" and collectively "Obligors") and each of them
jointly and severally: (a) waive presentment, demand, protest, notice of demand,
notice of intent to accelerate, notice of acceleration of maturity, notice of
protest, notice of nonpayment, notice of dishonor, and any other notice required
to be given under the law to any Obligor in connection with the delivery,
acceptance, performance, default or enforcement of this Note, any indorsement or
guaranty of this Note, or any other documents executed in connection with this
Note or any other note or other loan documents now or hereafter executed in
connection with any obligation of Borrower and Co-Obligors to Bank (the "Loan
Documents"); (b) consent to all delays, extensions, renewals or other
modifications of this Note or the Loan Documents, or waivers of any term hereof
or of the Loan Documents, or release or discharge by Bank of any of Obligors, or
release, substitution or exchange of any security for the payment hereof, or the
failure to act on the part of Bank, or any indulgence shown by Bank (without
notice to or further assent from any of Obligors), and agree that no such
action, failure to act or failure to exercise any right or remedy by Bank shall
in any way affect or impair the obligations of any Obligors or be construed as a
waiver by Bank of, or otherwise affect, any of Bank's rights under this Note,
under any indorsement or guaranty of this Note or under any of the Loan
Documents; and (c) agree to pay, on demand, all reasonable costs and expenses of
collection or defense of this Note or of any indorsement or guaranty hereof
and/or the enforcement or defense of Bank's rights with respect to, or the
administration, supervision, preservation, or protection of, or realization
upon, any property securing payment hereof, including, without limitation,
reasonable attorney's fees, including fees related to any suit, mediation or
arbitration proceeding, out of court payment agreement, trial, appeal,
bankruptcy proceedings or other proceeding, in such amount as may be determined
reasonable by any arbitrator or court, whichever is applicable.
5. PREPAYMENTS. Voluntary prepayments of principal or accrued interest may be
made, in whole or in part, at any time without penalty, except, in the case of a
LIBOR Rate borrowing, a payment prior to the end of the LIBOR Period will
require Borrower and Co-Obligors to pay Bank any breakage costs associated with
such prepayment.
6. DELINQUENCY CHARGE. To the extent permitted by law, a delinquency charge may
be imposed in an amount not to exceed four percent (4%) of any payment that is
more than fifteen days late.
7. EVENTS OF DEFAULT. The following are events of default hereunder: subject to
any applicable notice or cure period, (a) the failure to pay any obligation,
liability or indebtedness of any Obligor to Bank, whether under this Note, the
Loan Agreement or any Loan Documents, within five (5) days of the date when due
(whether upon demand, at maturity or by acceleration), provided, however, that
Borrower and Co-Obligors shall not be in Default as a result of a missed
interest payment if a Lender has failed to deliver to Borrower an interest
statement for such payment; (b) a Default as defined in the Loan Agreement.
8. REMEDIES UPON DEFAULT. Whenever there is a default under this Note (a) the
entire balance outstanding hereunder and all other obligations of any Obligor to
Bank (however acquired or
2
<PAGE> 63
evidenced) shall, at the option of Bank, become immediately due and payable and
any obligation of Bank to permit further borrowing under this Note shall
immediately cease and terminate, and/or (b) to the extent permitted by law, the
Rate of interest on the unpaid principal shall be increased to the Default Rate
as defined in the Loan Agreement. The provisions herein for a Default Rate shall
not be deemed to extend the time for any payment hereunder or to constitute a
"grace period" giving Obligors a right to cure any default. At Bank's option,
and to the extent permitted by law, any accrued and unpaid interest, fees or
charges may, for purposes of computing and accruing interest on a daily basis
after the due date of the Note or any installment thereof, be deemed to be a
part of the principal balance, and interest shall accrue on a daily compounded
basis after such date at the Default Rate provided in this Note until the entire
outstanding balance of principal and interest is paid in full. Upon a default
under this Note, Bank is hereby authorized at any time, at its option and
without notice or demand, to set off and charge against any deposit accounts of
any Obligor, (as well as any money, instruments, securities, documents, chattel
paper, credits, claims, demands, income and any other property, rights and
interests of any Obligor), which at any time shall come into the possession or
custody or under the control of Bank or any of its agents, affiliates or
correspondents, any and all obligations due hereunder. Additionally, Bank shall
have all rights and remedies available under each of the Loan Documents, as well
as all rights and remedies available at law or in equity.
9. NON-WAIVER. The failure at any time of Bank to exercise any of its options or
any other rights hereunder shall not constitute a waiver thereof, nor shall it
be a bar to the exercise of any of its options or rights at a later date. All
rights and remedies of Bank shall be cumulative and may be pursued singly,
successively or together, at the option of Bank. The acceptance by Bank of any
partial payment shall not constitute a waiver of any default or of any of Bank's
rights under this Note. No waiver of any of its rights hereunder, and no
modification or amendment of this Note, shall be deemed to be made by Bank
unless the same shall be in writing, duly signed on behalf of Bank; each such
waiver shall apply only with respect to the specific instance involved, and
shall in no way impair the rights of Bank or the obligations of Obligors to Bank
in any other respect at any other time.
10. APPLICABLE LAW, VENUE AND JURISDICTION. This Note and the rights and
obligations of Borrower, Co-Obligors and Bank under this Note shall be governed
by and interpreted in accordance with the law of the State of Tennessee. Except
for proceedings to enforce any mortgage, deed of trust, security agreement or
other collateral document, in any litigation in connection with or to enforce
this Note or any indorsement or guaranty of this Note or any Loan Documents,
Obligors, and each of them, irrevocably consent to and confer personal
jurisdiction on the courts of the State of Tennessee or the United States
located within the State of Tennessee and expressly waive any objections as to
venue in any such courts. Nothing contained herein shall, however, prevent Bank
from bringing any action or exercising any rights within any other state or
jurisdiction or from obtaining personal jurisdiction by any other means
available under applicable law.
11. PARTIAL INVALIDITY. The unenforceability or invalidity of any provision of
this Note shall not affect the enforceability or validity of any other provision
herein and the invalidity or unenforceability of any provision of this Note or
of the Loan Documents to any person or
3
<PAGE> 64
circumstance shall not affect the enforceability or validity of such provision
as it may apply to other persons or circumstances.
12. BINDING EFFECT. This Note shall be binding upon and inure to the benefit of
Borrower, Co-Obligors, Obligors and Bank and their respective successors,
assigns, heirs and personal representatives, provided, however, that no
obligations of Borrower, Co-Obligors or Obligors hereunder can be assigned
without prior written consent of Bank.
13. CONTROLLING DOCUMENT. To the extent that this Note conflicts with or is in
any way incompatible with any other document related specifically to the loan
evidenced by this Note, this Note shall control over any other such document
except the Loan Agreement, and if this Note does not address an issue, then each
other such document shall control to the extent that it deals most specifically
with an issue.
14. ARBITRATION. ANY CONTROVERSY OR CLAIM BETWEEN OR AMONG THE PARTIES HERETO
INCLUDING BUT NOT LIMITED TO THOSE ARISING OUT OF OR RELATING TO THIS
INSTRUMENT, AGREEMENT OR DOCUMENT OR ANY RELATED INSTRUMENTS, AGREEMENTS OR
DOCUMENTS, INCLUDING ANY CLAIM BASED ON OR ARISING FROM AN ALLEGED TORT, SHALL
BE DETERMINED BY BINDING ARBITRATION IN ACCORDANCE WITH THE FEDERAL ARBITRATION
ACT (OR IF NOT APPLICABLE, THE APPLICABLE STATE LAW), THE RULES OF PRACTICE AND
PROCEDURE FOR THE ARBITRATION OF COMMERCIAL DISPUTES OF J.A.M.S./ENDISPUTE OR
ANY SUCCESSOR THEREOF ("J.A.M.S."), AND THE "SPECIAL RULES" SET FORTH BELOW. IN
THE EVENT OF ANY INCONSISTENCY, THE SPECIAL RULES SHALL CONTROL. JUDGMENT UPON
ANY ARBITRATION AWARD MAY BE ENTERED IN ANY COURT HAVING JURISDICTION. ANY PARTY
TO THIS INSTRUMENT, AGREEMENT OR DOCUMENT MAY BRING AN ACTION, INCLUDING A
SUMMARY OR EXPEDITED PROCEEDING, TO COMPEL ARBITRATION OF ANY CONTROVERSY OR
CLAIM TO WHICH THIS AGREEMENT APPLIES IN ANY COURT HAVING JURISDICTION OVER SUCH
ACTION.
A. SPECIAL RULES. THE ARBITRATION SHALL BE CONDUCTED IN PALM BEACH COUNTY,
FLORIDA, AND ADMINISTERED BY J.A.M.S. WHO WILL APPOINT AN ARBITRATOR; IF
J.A.M.S. IS UNABLE OR LEGALLY PRECLUDED FROM ADMINISTERING THE ARBITRATION, THEN
THE AMERICAN ARBITRATION ASSOCIATION WILL SERVE. ALL ARBITRATION HEARINGS WILL
BE COMMENCED WITHIN 90 DAYS OF THE DEMAND FOR ARBITRATION; FURTHER, THE
ARBITRATOR SHALL ONLY, UPON A SHOWING OF CAUSE, BE PERMITTED TO EXTEND THE
COMMENCEMENT OF SUCH HEARING FOR UP TO AN ADDITIONAL 60 DAYS.
B. RESERVATION OF RIGHTS. NOTHING IN THIS ARBITRATION PROVISION
SHALL BE DEEMED TO (I) LIMIT THE APPLICABILITY OF ANY OTHERWISE
4
<PAGE> 65
APPLICABLE STATUTES OF LIMITATION OR REPOSE AND ANY WAIVERS CONTAINED IN THIS
INSTRUMENT, AGREEMENT OR DOCUMENT; OR (II) BE A WAIVER BY BANK OF THE PROTECTION
AFFORDED TO IT BY 12 U.S.C. SEC. 91 OR ANY SUBSTANTIALLY EQUIVALENT STATE LAW;
OR (III) LIMIT THE RIGHT OF BANK HERETO (A) TO EXERCISE SELF HELP REMEDIES SUCH
AS (BUT NOT LIMITED TO) SETOFF, OR (B) TO FORECLOSE AGAINST ANY REAL OR PERSONAL
PROPERTY COLLATERAL, OR (C) TO OBTAIN FROM A COURT PROVISIONAL OR ANCILLARY
REMEDIES SUCH AS (BUT NOT LIMITED TO) INJUNCTIVE RELIEF, WRIT OF POSSESSION OR
THE APPOINTMENT OF A RECEIVER. BANK MAY EXERCISE SUCH SELF HELP RIGHTS,
FORECLOSE UPON SUCH PROPERTY, OR OBTAIN SUCH PROVISIONAL OR ANCILLARY REMEDIES
BEFORE, DURING OR AFTER THE PENDENCY OF ANY ARBITRATION PROCEEDING BROUGHT
PURSUANT TO THIS INSTRUMENT, AGREEMENT OR DOCUMENT. NEITHER THIS EXERCISE OF
SELF HELP REMEDIES NOR THE INSTITUTION OR MAINTENANCE OF AN ACTION FOR
FORECLOSURE OR PROVISIONAL OR ANCILLARY REMEDIES SHALL CONSTITUTE A WAIVER OF
THE RIGHT OF ANY PARTY, INCLUDING THE CLAIMANT IN ANY SUCH ACTION, TO ARBITRATE
THE MERITS OF THE CONTROVERSY OR CLAIM OCCASIONING RESORT TO SUCH REMEDIES.
NOTICE OF FINAL AGREEMENT. THIS WRITTEN PROMISSORY NOTE
REPRESENTS THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT
BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR
SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO
UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.
COOKER RESTAURANT
CORPORATION CGR MANAGEMENT CORPORATION
By: /s/ Mark W. Mikosz By: /s/ Mark W. Mikosz
--------------------------------- -----------------------------
Its: Vice President, Chief Financial Its: Vice President
Officer ----------------------------
--------------------------------
5
<PAGE> 66
SOUTHERN COOKER LIMITED
FLORIDA COOKER LP, INC. PARTNERSHIP
By: Cooker Restaurant Corporation,
By: /s/ Mark W. Mikosz General Partner
---------------------------------
Its: Vice President By /s/ Mark W. Mikosz
-------------------------------- --------------------------------
Its: Vice President
------------------------------
6
<PAGE> 67
[STATE OF TENNESSEE )
)
COUNTY OF DAVIDSON )
BEFORE ME, THE UNDERSIGNED, A NOTARY PUBLIC OF THE STATE AND COUNTY
AFORESAID, PERSONALLY APPEARED MARK MIKOSZ, WITH WHOM I AM PERSONALLY
ACQUAINTED, AND WHO, UPON OATH, ACKNOWLEDGED HIMSELF TO BE THE VP, CFO OF
COOKER RESTAURANT CORPORATION, THE WITHIN NAMED BARGAINOR, A CORPORATION, AND
THAT HE, AS SUCH VP, CFO, BEING AUTHORIZED SO TO DO, EXECUTED THE FOREGOING
INSTRUMENT FOR THE PURPOSES THEREIN CONTAINED, BY SIGNING THE NAME OF THE
CORPORATION BY HIMSELF AS VP, CFO.
WITNESS MY HAND AND SEAL AT OFFICE IN NASHVILLE, TENNESSEE, THIS 24TH
DAY OF SEPTEMBER, 1998.
/s/ Mittie Jean Compton
-----------------------------
NOTARY PUBLIC
MY COMMISSION EXPIRES:
11-27-99
- ---------------------
STATE OF TENNESSEE )
)
COUNTY OF DAVIDSON )
BEFORE ME, THE UNDERSIGNED, A NOTARY PUBLIC OF THE STATE AND COUNTY
AFORESAID, PERSONALLY APPEARED MARK W. MIKOSZ, WITH WHOM I AM PERSONALLY
ACQUAINTED, AND WHO, UPON OATH, ACKNOWLEDGED HIMSELF TO BE THE VP OF CGR
MANAGEMENT CORPORATION, THE WITHIN NAMED BARGAINOR, A CORPORATION, AND THAT HE,
AS SUCH VP, BEING AUTHORIZED SO TO DO, EXECUTED THE FOREGOING INSTRUMENT FOR THE
PURPOSES THEREIN CONTAINED, BY SIGNING THE NAME OF THE CORPORATION BY HIMSELF AS
VP.
WITNESS MY HAND AND SEAL AT OFFICE IN NASHVILLE, TENNESSEE, THIS 24TH
DAY OF SEPTEMBER, 1998.
/s/ Mittie Jean Compton
-----------------------------
NOTARY PUBLIC
MY COMMISSION EXPIRES:
11-27-99
- ---------------------
7
<PAGE> 68
STATE OF TENNESSEE )
)
COUNTY OF DAVIDSON )
BEFORE ME, THE UNDERSIGNED, A NOTARY PUBLIC OF THE STATE AND COUNTY
AFORESAID, PERSONALLY APPEARED MARK W. MIKOSZ, WITH WHOM I AM PERSONALLY
ACQUAINTED, AND WHO, UPON OATH, ACKNOWLEDGED HIMSELF TO BE THE VP OF FLORIDA
COOKER LP, INC., THE WITHIN NAMED BARGAINOR, A CORPORATION, AND THAT HE, AS SUCH
VP, BEING AUTHORIZED SO TO DO, EXECUTED THE FOREGOING INSTRUMENT FOR THE
PURPOSES THEREIN CONTAINED, BY SIGNING THE NAME OF THE CORPORATION BY HIMSELF AS
VP.
WITNESS MY HAND AND SEAL AT OFFICE IN NASHVILLE, TENNESSEE, THIS 24TH
DAY OF SEPTEMBER, 1998.
/s/ Mittie Jean Compton
-----------------------------
NOTARY PUBLIC
MY COMMISSION EXPIRES:
11-27-99
- ---------------------
STATE OF TENNESSEE )
)
COUNTY OF DAVIDSON )
BEFORE ME, THE UNDERSIGNED, A NOTARY PUBLIC OF THE STATE AND COUNTY
AFORESAID, PERSONALLY APPEARED MARK W. MIKOSZ, WITH WHOM I AM PERSONALLY
ACQUAINTED, AND WHO, UPON OATH, ACKNOWLEDGED HIMSELF TO BE THE VP OF COOKER
RESTAURANT CORPORATION, THE GENERAL PARTNER OF SOUTHERN COOKER LIMITED
PARTNERSHIP, THE WITHIN NAMED BARGAINOR, A LIMITED PARTNERSHIP, AND THAT HE, AS
SUCH VP, BEING AUTHORIZED SO TO DO, EXECUTED THE FOREGOING INSTRUMENT FOR THE
PURPOSES THEREIN CONTAINED, BY SIGNING THE NAME OF THE CORPORATION BY HIMSELF AS
VP.
WITNESS MY HAND AND SEAL AT OFFICE IN NASHVILLE, TENNESSEE, THIS 24TH
DAY OF SEPTEMBER, 1998.
/s/ Mittie Jean Compton
-----------------------------
NOTARY PUBLIC
MY COMMISSION EXPIRES:
11-27-99
- ---------------------
8
<PAGE> 69
TERM LOAN NOTE
<TABLE>
Date: September 24, 1998 Amount: $22,500,000.00
<S> <C>
======================================================================================================================
BANK: BORROWER:
First Union National Bank Cooker Restaurant Corporation
77 East Camino Real. 5500 Village Blvd. - 2nd Floor
2nd Floor West Palm Beach, Palm Beach County, FL
Boca Raton, Florida 33432 33407
CO-OBLIGORS:
CGR
Management Corporation
5500 Village Blvd. - 2nd Floor
West Palm Beach, FL 33407
Florida Cooker LP, Inc.
5500 Village Blvd. - 2nd Floor
West Palm Beach, FL 33407
Southern Cooker Limited Partnership
5500 Village Blvd. - 2nd Floor
West Palm Beach, FL 33407
======================================================================================================================
</TABLE>
FOR VALUE RECEIVED, the undersigned Borrower and Co-Obligors, jointly and
severally, unconditionally promise to pay to the order of Bank, its successors
and assigns, without setoff, at its offices indicated at the beginning of this
Note, or at such other place as may be designated by Bank, the principal amount
of Twenty-Two Million Five Hundred Thousand and 00/100 Dollars ($22,500,000.00)
or so much thereof as may be advanced from time to time in immediately available
funds, together with interest computed daily on the outstanding principal
balance hereunder, at an annual interest rate, and in accordance with the
payment schedule, indicated below. This Note is one of the Term Loan Notes made
pursuant to that Loan Agreement of even date herewith between Borrower,
Co-Obligors and NationsBank of Tennessee, N.A., as Agent for itself and First
Union National Bank ("Loan Agreement"). Capitalized terms not defined herein
shall have the meaning contained in the Loan Agreement.
This is an amendment, restatement, modification and renewal of a portion of
the indebtedness owed by Borrower to Bank evidenced by that Promissory Note in
the principal amount of $33,000,000.00 dated the 26th day of August, 1991, as
amended.
1. RATE. The rate shall be as provided in the Loan Agreement.
Notwithstanding any provision of this Note, Bank does not intend to charge and
Borrower and Co-Obligors shall not be required to pay any amount of interest or
other charges in excess of the
<PAGE> 70
maximum permitted by the applicable law of the State of Tennessee; if any higher
rate ceiling is lawful, then that higher rate ceiling shall apply. Any payment
in excess of such maximum shall be refunded to Borrower and Co-Obligors or
credited against principal, at the option of Bank.
2. ACCRUAL METHOD. Interest at the Rate set forth above will be calculated by
the 365/360 day method (a daily amount of interest is computed for a
hypothetical year of 360 days; that amount is multiplied by the actual number of
days for which any principal is outstanding hereunder).
3. PAYMENT SCHEDULE. All payments received hereunder shall be applied first to
the payment of any expense or charges payable hereunder or under any other loan
documents executed in connection with this Note, then to interest due and
payable, with the balance applied to principal, or in such other order as Bank
shall determine at its option.
Payments shall be made on the dates and in the amounts set forth in the Loan
Agreement. The maturity date of this Note is March 24, 2004, subject to the
provisions of Section 5 of the Loan Agreement.
4. WAIVERS, CONSENTS AND COVENANTS. Subject to any applicable cure periods,
Borrower and Co-Obligors, any indorser or guarantor hereof, or any other party
hereto (individually an "Obligor" and collectively "Obligors") and each of them
jointly and severally: (a) waive presentment, demand, protest, notice of demand,
notice of intent to accelerate, notice of acceleration of maturity, notice of
protest, notice of nonpayment, notice of dishonor, and any other notice required
to be given under the law to any Obligor in connection with the delivery,
acceptance, performance, default or enforcement of this Note, any indorsement or
guaranty of this Note, or any other documents executed in connection with this
Note or any other note or other loan documents now or hereafter executed in
connection with any obligation of Borrower and Co-Obligors to Bank (the "Loan
Documents"); (b) consent to all delays, extensions, renewals or other
modifications of this Note or the Loan Documents, or waivers of any term hereof
or of the Loan Documents, or release or discharge by Bank of any of Obligors, or
release, substitution or exchange of any security for the payment hereof, or the
failure to act on the part of Bank, or any indulgence shown by Bank (without
notice to or further assent from any of Obligors), and agree that no such
action, failure to act or failure to exercise any right or remedy by Bank shall
in any way affect or impair the obligations of any Obligors or be construed as a
waiver by Bank of, or otherwise affect, any of Bank's rights under this Note,
under any indorsement or guaranty of this Note or under any of the Loan
Documents; and (c) agree to pay, on demand, all reasonable costs and expenses of
collection or defense of this Note or of any indorsement or guaranty hereof
and/or the enforcement or defense of Bank's rights with respect to, or the
administration, supervision, preservation, or protection of, or realization
upon, any property securing payment hereof, including, without limitation,
reasonable attorney's fees, including fees related to any suit, mediation or
arbitration proceeding, out of court payment agreement, trial, appeal,
bankruptcy proceedings or other proceeding, in such amount as may be determined
reasonable by any arbitrator or court, whichever is applicable.
5. PREPAYMENTS. Voluntary prepayments of principal or accrued interest may be
made, in whole or in part, at any time without penalty, except, in the case of a
LIBOR Rate borrowing, a payment
2
<PAGE> 71
prior to the end of the LIBOR Period will require Borrower and Co-Obligors to
pay Bank any breakage costs associated with such prepayment.
6. DELINQUENCY CHARGE. To the extent permitted by law, a delinquency charge may
be imposed in an amount not to exceed four percent (4%) of any payment that is
more than fifteen days late.
7. EVENTS OF DEFAULT. The following are events of default hereunder: subject to
any applicable notice or cure period, (a) the failure to pay any obligation,
liability or indebtedness of any Obligor to Bank, whether under this Note, the
Loan Agreement or any Loan Documents, within five (5) days of the date when due
(whether upon demand, at maturity or by acceleration), provided, however, that
Borrower and Co-Obligors shall not be in Default as a result of a missed
interest payment if a Lender has failed to deliver to Borrower an interest
statement for such payment; (b) a Default as defined in the Loan Agreement.
8. REMEDIES UPON DEFAULT. Whenever there is a default under this Note (a) the
entire balance outstanding hereunder and all other obligations of any Obligor to
Bank (however acquired or evidenced) shall, at the option of Bank, become
immediately due and payable and any obligation of Bank to permit further
borrowing under this Note shall immediately cease and terminate, and/or (b) to
the extent permitted by law, the Rate of interest on the unpaid principal shall
be increased to the Default Rate as defined in the Loan Agreement. The
provisions herein for a Default Rate shall not be deemed to extend the time for
any payment hereunder or to constitute a "grace period" giving Obligors a right
to cure any default. At Bank's option, and to the extent permitted by law, any
accrued and unpaid interest, fees or charges may, for purposes of computing and
accruing interest on a daily basis after the due date of the Note or any
installment thereof, be deemed to be a part of the principal balance, and
interest shall accrue on a daily compounded basis after such date at the Default
Rate provided in this Note until the entire outstanding balance of principal and
interest is paid in full. Upon a default under this Note, Bank is hereby
authorized at any time, at its option and without notice or demand, to set off
and charge against any deposit accounts of any Obligor, (as well as any money,
instruments, securities, documents, chattel paper, credits, claims, demands,
income and any other property, rights and interests of any Obligor), which at
any time shall come into the possession or custody or under the control of Bank
or any of its agents, affiliates or correspondents, any and all obligations due
hereunder. Additionally, Bank shall have all rights and remedies available under
each of the Loan Documents, as well as all rights and remedies available at law
or in equity.
9. NON-WAIVER. The failure at any time of Bank to exercise any of its options or
any other rights hereunder shall not constitute a waiver thereof, nor shall it
be a bar to the exercise of any of its options or rights at a later date. All
rights and remedies of Bank shall be cumulative and may be pursued singly,
successively or together, at the option of Bank. The acceptance by Bank of any
partial payment shall not constitute a waiver of any default or of any of Bank's
rights under this Note. No waiver of any of its rights hereunder, and no
modification or amendment of this Note, shall be deemed to be made by Bank
unless the same shall be in writing, duly signed on behalf of Bank; each such
waiver shall apply only with respect to the specific instance involved, and
shall in no way impair the rights of Bank or the obligations of Obligors to Bank
in any other respect at any
3
<PAGE> 72
other time.
10. APPLICABLE LAW, VENUE AND JURISDICTION. This Note and the rights and
obligations of Borrower, Co-Obligors and Bank under this Note shall be governed
by and interpreted in accordance with the law of the State of Tennessee. Except
for proceedings to enforce any mortgage, deed of trust, security agreement or
other collateral document, in any litigation in connection with or to enforce
this Note or any indorsement or guaranty of this Note or any Loan Documents,
Obligors, and each of them, irrevocably consent to and confer personal
jurisdiction on the courts of the State of Tennessee or the United States
located within the State of Tennessee and expressly waive any objections as to
venue in any such courts. Nothing contained herein shall, however, prevent Bank
from bringing any action or exercising any rights within any other state or
jurisdiction or from obtaining personal jurisdiction by any other means
available under applicable law.
11. PARTIAL INVALIDITY. The unenforceability or invalidity of any provision of
this Note shall not affect the enforceability or validity of any other provision
herein and the invalidity or unenforceability of any provision of this Note or
of the Loan Documents to any person or circumstance shall not affect the
enforceability or validity of such provision as it may apply to other persons or
circumstances.
12. BINDING EFFECT. This Note shall be binding upon and inure to the benefit of
Borrower, Co-Obligors, Obligors and Bank and their respective successors,
assigns, heirs and personal representatives, provided, however, that no
obligations of Borrower, Co-Obligors or Obligors hereunder can be assigned
without prior written consent of Bank.
13. CONTROLLING DOCUMENT. To the extent that this Note conflicts with or is in
any way incompatible with any other document related specifically to the loan
evidenced by this Note, this Note shall control over any other such document
except the Loan Agreement, and if this Note does not address an issue, then each
other such document shall control to the extent that it deals most specifically
with an issue.
14. ARBITRATION. ANY CONTROVERSY OR CLAIM BETWEEN OR AMONG THE PARTIES HERETO
INCLUDING BUT NOT LIMITED TO THOSE ARISING OUT OF OR RELATING TO THIS
INSTRUMENT, AGREEMENT OR DOCUMENT OR ANY RELATED INSTRUMENTS, AGREEMENTS OR
DOCUMENTS, INCLUDING ANY CLAIM BASED ON OR ARISING FROM AN ALLEGED TORT, SHALL
BE DETERMINED BY BINDING ARBITRATION IN ACCORDANCE WITH THE FEDERAL ARBITRATION
ACT (OR IF NOT APPLICABLE, THE APPLICABLE STATE LAW), THE RULES OF PRACTICE AND
PROCEDURE FOR THE ARBITRATION OF COMMERCIAL DISPUTES OF J.A.M.S./ENDISPUTE OR
ANY SUCCESSOR THEREOF ("J.A.M.S."), AND THE "SPECIAL RULES" SET FORTH BELOW. IN
THE EVENT OF ANY INCONSISTENCY, THE SPECIAL RULES SHALL CONTROL. JUDGMENT UPON
ANY ARBITRATION AWARD MAY BE ENTERED IN ANY COURT HAVING JURISDICTION. ANY PARTY
TO THIS INSTRUMENT, AGREEMENT OR DOCUMENT MAY BRING AN ACTION, INCLUDING A
SUMMARY OR EXPEDITED PROCEEDING,
4
<PAGE> 73
TO COMPEL ARBITRATION OF ANY CONTROVERSY OR CLAIM TO WHICH THIS
AGREEMENT APPLIES IN ANY COURT HAVING JURISDICTION OVER SUCH
ACTION.
A. SPECIAL RULES. THE ARBITRATION SHALL BE CONDUCTED IN PALM BEACH COUNTY,
FLORIDA, AND ADMINISTERED BY J.A.M.S. WHO WILL APPOINT AN ARBITRATOR; IF
J.A.M.S. IS UNABLE OR LEGALLY PRECLUDED FROM ADMINISTERING THE ARBITRATION, THEN
THE AMERICAN ARBITRATION ASSOCIATION WILL SERVE. ALL ARBITRATION HEARINGS WILL
BE COMMENCED WITHIN 90 DAYS OF THE DEMAND FOR ARBITRATION; FURTHER, THE
ARBITRATOR SHALL ONLY, UPON A SHOWING OF CAUSE, BE PERMITTED TO EXTEND THE
COMMENCEMENT OF SUCH HEARING FOR UP TO AN ADDITIONAL 60 DAYS.
B. RESERVATION OF RIGHTS. NOTHING IN THIS ARBITRATION PROVISION SHALL BE
DEEMED TO (I) LIMIT THE APPLICABILITY OF ANY OTHERWISE APPLICABLE STATUTES OF
LIMITATION OR REPOSE AND ANY WAIVERS CONTAINED IN THIS INSTRUMENT, AGREEMENT OR
DOCUMENT; OR (II) BE A WAIVER BY BANK OF THE PROTECTION AFFORDED TO IT BY 12
U.S.C. SEC. 91 OR ANY SUBSTANTIALLY EQUIVALENT STATE LAW; OR (III) LIMIT THE
RIGHT OF BANK HERETO (A) TO EXERCISE SELF HELP REMEDIES SUCH AS (BUT NOT LIMITED
TO) SETOFF, OR (B) TO FORECLOSE AGAINST ANY REAL OR PERSONAL PROPERTY
COLLATERAL, OR (C) TO OBTAIN FROM A COURT PROVISIONAL OR ANCILLARY REMEDIES SUCH
AS (BUT NOT LIMITED TO) INJUNCTIVE RELIEF, WRIT OF POSSESSION OR THE APPOINTMENT
OF A RECEIVER. BANK MAY EXERCISE SUCH SELF HELP RIGHTS, FORECLOSE UPON SUCH
PROPERTY, OR OBTAIN SUCH PROVISIONAL OR ANCILLARY REMEDIES BEFORE, DURING OR
AFTER THE PENDENCY OF ANY ARBITRATION PROCEEDING BROUGHT PURSUANT TO THIS
INSTRUMENT, AGREEMENT OR DOCUMENT. NEITHER THIS EXERCISE OF SELF HELP REMEDIES
NOR THE INSTITUTION OR MAINTENANCE OF AN ACTION FOR FORECLOSURE OR PROVISIONAL
OR ANCILLARY REMEDIES SHALL CONSTITUTE A WAIVER OF THE RIGHT OF ANY PARTY,
INCLUDING THE CLAIMANT IN ANY SUCH ACTION, TO ARBITRATE THE MERITS OF THE
CONTROVERSY OR CLAIM OCCASIONING RESORT TO SUCH REMEDIES.
NOTICE OF FINAL AGREEMENT. THIS WRITTEN PROMISSORY NOTE REPRESENTS THE FINAL
AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR,
CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO
UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.
5
<PAGE> 74
COOKER RESTAURANT
CORPORATION CGR MANAGEMENT CORPORATION
By: /s/ Mark W. Mikosz By: /s/ Mark W. Mikosz
--------------------------- --------------------------------
Its: Vice President, Chief Its: Vice President
Financial Officer -------------------------------
--------------------------
SOUTHERN COOKER LIMITED
FLORIDA COOKER LP, INC. PARTNERSHIP
By: Cooker Restaurant Corporation,
By: /s/ Mark W. Mikosz General Partner
---------------------------
Its: Vice President By: /s/ Mark W. Mikosz
-------------------------- --------------------------------
Its: Vice President
-------------------------------
6
<PAGE> 75
STATE OF TENNESSEE )
)
COUNTY OF DAVIDSON )
Before me, the undersigned, a Notary Public of the state and county
aforesaid, personally appeared Mark Mikosz, with whom I am personally
acquainted, and who, upon oath, acknowledged himself to be the VP, CFO of COOKER
RESTAURANT CORPORATION, the within named bargainor, a corporation, and that he,
as such VP, CFO, being authorized so to do, executed the foregoing instrument
for the purposes therein contained, by signing the name of the corporation by
himself as VP, CFO.
Witness my hand and seal at office in Nashville, Tennessee, this 24th
day of September, 1998.
/s/ Mittie Jean Compton
-----------------------------
Notary Public
My Commission Expires:
11-27-99
- ---------------------
STATE OF TENNESSEE )
)
COUNTY OF DAVIDSON )
Before me, the undersigned, a Notary Public of the state and county
aforesaid, personally appeared Mark Mikosz, with whom I am personally
acquainted, and who, upon oath, acknowledged himself to be the VP of CGR
MANAGEMENT CORPORATION, the within named bargainor, a corporation, and that he,
as such VP, being authorized so to do, executed the foregoing instrument for the
purposes therein contained, by signing the name of the corporation by himself as
VP.
Witness my hand and seal at office in Nashville, Tennessee, this 24th
day of September, 1998.
/s/ Mittie Jean Compton
-----------------------------
Notary Public
My Commission Expires:
11-27-99
- ---------------------
7
<PAGE> 76
STATE OF TENNESSEE )
)
COUNTY OF DAVIDSON )
Before me, the undersigned, a Notary Public of the state and county
aforesaid, personally appeared Mark Mikosz, with whom I am personally
acquainted, and who, upon oath, acknowledged himself to be the VP of FLORIDA
COOKER LP, INC., the within named bargainor, a corporation, and that he, as such
VP, being authorized so to do, executed the foregoing instrument for the
purposes therein contained, by signing the name of the corporation by himself as
VP.
Witness my hand and seal at office in Nashville, Tennessee, this 24th
day of September, 1998.
/s/ Mittie Jean Compton
-----------------------------
Notary Public
My Commission Expires:
11-27-99
- ---------------------
STATE OF TENNESSEE )
)
COUNTY OF DAVIDSON )
Before me, the undersigned, a Notary Public of the state and county
aforesaid, personally appeared Mark Mikosz, with whom I am personally
acquainted, and who, upon oath, acknowledged himself to be the VP of COOKER
RESTAURANT CORPORATION, the general partner of SOUTHERN COOKER LIMITED
PARTNERSHIP, the within named bargainor, a limited partnership, and that he, as
such VP, being authorized so to do, executed the foregoing instrument for the
purposes therein contained, by signing the name of the corporation by himself as
VP.
Witness my hand and seal at office in Nashville, Tennessee, this 24th
day of September, 1998.
/s/ Mittie Jean Compton
-----------------------------
Notary Public
My Commission Expires:
11-27-99
- ---------------------
8
<PAGE> 77
RENEWAL REVOLVING LOAN NOTE
<TABLE>
Date: March 24, 1999 Amount: $ _________________
======================================================================================================================
<S> <C>
BANK: BORROWER:
NationsBank of Tennessee, N.A. Cooker Restaurant Corporation
Commercial Lending - 2nd Floor 5500 Village Blvd. - 2nd Floor
One NationsBank Plaza West Palm Beach, Palm Beach County, FL
Nashville, Davidson County, TN 37239 33407
CO-OBLIGORS:
CGR
Management Corporation
5500 Village Blvd. - 2nd Floor
West Palm Beach, FL 33407
Florida Cooker LP, Inc.
5500 Village Blvd. - 2nd Floor
West Palm Beach, FL 33407
Southern Cooker Limited Partnership
5500 Village Blvd. - 2nd Floor
West Palm Beach, FL 33407
======================================================================================================================
</TABLE>
FOR VALUE RECEIVED, the undersigned Borrower and Co-Obligors, jointly and
severally, unconditionally promise to pay to the order of Bank, its successors
and assigns, without setoff, at its offices indicated at the beginning of this
Note, or at such other place as may be designated by Bank, the principal amount
of _________________ and 00/100 Dollars ($_______________), or so much thereof
as may be advanced from time to time in immediately available funds, together
with interest computed daily on the outstanding principal balance hereunder, at
an annual interest rate, and in accordance with the payment schedule, indicated
below. This Note is the Renewal Revolving Note made pursuant to that Loan
Agreement dated September 24, 1998 between Borrower, Co-Obligors and
NationsBank of Tennessee, N.A., as Agent for itself and First Union National
Bank ("Loan Agreement"). Capitalized terms not defined herein shall have the
meaning contained in the Loan Agreement.
1. RATE. The rate shall be as provided in the Loan Agreement.
1
<PAGE> 78
Notwithstanding any provision of this Note, Bank does not intend to charge and
Borrower and Co-Obligors shall not be required to pay any amount of interest or
other charges in excess of the maximum permitted by the applicable law of the
State of Tennessee; if any higher rate ceiling is lawful, then that higher rate
ceiling shall apply. Any payment in excess of such maximum shall be refunded to
Borrower and Co-Obligors or credited against principal, at the option of Bank.
2. ACCRUAL METHOD. Interest at the Rate set forth above will be calculated by
the 365/360 day method (a daily amount of interest is computed for a
hypothetical year of 360 days; that amount is multiplied by the actual number of
days for which any principal is outstanding hereunder).
3. PAYMENT SCHEDULE. All payments received hereunder shall be applied first to
the payment of any expense or charges payable hereunder or under any other loan
documents executed in connection with this Note, then to interest due and
payable, with the balance applied to principal, or in such other order as Bank
shall determine at its option.
Payments shall be made on the dates and in the amounts set forth in the Loan
Agreement. The maturity date of this Note is March 24, 2004, subject to the
provisions of Section 5 of the Loan Agreement.
4. ADVANCES. This is a revolving note. Advances to Borrower and Co-Obligors
shall be made in accordance with the terms of the Loan Agreement.
5. WAIVERS, CONSENTS AND COVENANTS. Subject to any applicable cure periods,
Borrower and Co-Obligors, any indorser or guarantor hereof, or any other party
hereto (individually an "Obligor" and collectively "Obligors") and each of them
jointly and severally: (a) waive presentment, demand, protest, notice of demand,
notice of intent to accelerate, notice of acceleration of maturity, notice of
protest, notice of nonpayment, notice of dishonor, and any other notice required
to be given under the law to any Obligor in connection with the delivery,
acceptance, performance, default or enforcement of this Note, any indorsement or
guaranty of this Note, or any other documents executed in connection with this
Note or any other note or other loan documents now or hereafter executed in
connection with any obligation of Borrower and Co-Obligors to Bank (the "Loan
Documents"); (b) consent to all delays, extensions, renewals or other
modifications of this Note or the Loan Documents, or waivers of any term hereof
or of the Loan Documents, or release or discharge by Bank of any of Obligors, or
release, substitution or exchange of any security for the payment hereof, or the
failure to act on the part of Bank, or any indulgence shown by Bank (without
notice to or further assent from any of Obligors), and agree that no such
action, failure to act or failure to exercise any right or remedy by Bank shall
in any way affect or impair the obligations of any Obligors or be construed as a
waiver by Bank of, or otherwise affect, any of Bank's rights under this Note,
under any indorsement or guaranty of this Note or under any of the Loan
Documents; and (c) agree to pay, on demand, all reasonable costs and expenses of
collection or defense of this Note or of any indorsement or guaranty hereof
and/or the enforcement or defense of Bank's rights with respect to, or the
administration, supervision, preservation, or protection of, or realization
upon, any property securing payment hereof, including, without limitation,
reasonable attorney's fees, including fees related to any suit, mediation or
arbitration proceeding, out of court payment agreement, trial, appeal,
bankruptcy proceedings or other proceeding, in such amount as may be determined
reasonable by any arbitrator or court, whichever is applicable.
<PAGE> 79
6. PREPAYMENTS. Voluntary prepayments of principal or accrued interest may be
made, in whole or in part, at any time without penalty, except, in the case of a
LIBOR Rate borrowing, a payment prior to the end of the LIBOR Period will
require Borrower and Co-Obligors to pay Bank any breakage costs associated with
such prepayment.
7. DELINQUENCY CHARGE. To the extent permitted by law, a delinquency charge may
be imposed in an amount not to exceed four percent (4%) of any payment that is
more than fifteen days late.
8. EVENTS OF DEFAULT. The following are events of default hereunder: subject to
any applicable notice or cure period, (a) the failure to pay any obligation,
liability or indebtedness of any Obligor to Bank, whether under this Note, the
Loan Agreement or any Loan Documents, within five (5) days of the date when due
(whether upon demand, at maturity or by acceleration), provided, however, that
Borrower and Co-Obligors shall not be in Default as a result of a missed
interest payment if a Lender has failed to deliver to Borrower an interest
statement for such payment; (b) a Default as defined in the Loan Agreement.
9. REMEDIES UPON DEFAULT. Whenever there is a default under this Note (a) the
entire balance outstanding hereunder and all other obligations of any Obligor to
Bank (however acquired or evidenced) shall, at the option of Bank, become
immediately due and payable and any obligation of Bank to permit further
borrowing under this Note shall immediately cease and terminate, and/or (b) to
the extent permitted by law, the Rate of interest on the unpaid principal shall
be increased to the Default Rate as defined in the Loan Agreement. The
provisions herein for a Default Rate shall not be deemed to extend the time for
any payment hereunder or to constitute a "grace period" giving Obligors a right
to cure any default. At Bank's option, and to the extent permitted by law, any
accrued and unpaid interest, fees or charges may, for purposes of computing and
accruing interest on a daily basis after the due date of the Note or any
installment thereof, be deemed to be a part of the principal balance, and
interest shall accrue on a daily compounded basis after such date at the Default
Rate provided in this Note until the entire outstanding balance of principal and
interest is paid in full. Upon a default under this Note, Bank is hereby
authorized at any time, at its option and without notice or demand, to set off
and charge against any deposit accounts of any Obligor, (as well as any money,
instruments, securities, documents, chattel paper, credits, claims, demands,
income and any other property, rights and interests of any Obligor), which at
any time shall come into the possession or custody or under the control of Bank
or any of its agents, affiliates or correspondents, any and all obligations due
hereunder. Additionally, Bank shall have all rights and remedies available under
each of the Loan Documents, as well as all rights and remedies available at law
or in equity.
10. NON-WAIVER. The failure at any time of Bank to exercise any of its options
or any other rights hereunder shall not constitute a waiver thereof, nor shall
it be a bar to the exercise of any of its options or rights at a later date. All
rights and remedies of Bank shall be cumulative and may be pursued singly,
successively or together, at the option of Bank. The acceptance by Bank of any
3
<PAGE> 80
partial payment shall not constitute a waiver of any default or of any of Bank's
rights under this Note. No waiver of any of its rights hereunder, and no
modification or amendment of this Note, shall be deemed to be made by Bank
unless the same shall be in writing, duly signed on behalf of Bank; each such
waiver shall apply only with respect to the specific instance involved, and
shall in no way impair the rights of Bank or the obligations of Obligors to Bank
in any other respect at any other time.
11. APPLICABLE LAW, VENUE AND JURISDICTION. This Note and the rights and
obligations of Borrower, Co-Obligors and Bank under this Note shall be governed
by and interpreted in accordance with the law of the State of Tennessee. Except
for proceedings to enforce any mortgage, deed of trust, security agreement or
other collateral document, in any litigation in connection with or to enforce
this Note or any indorsement or guaranty of this Note or any Loan Documents,
Obligors, and each of them, irrevocably consent to and confer personal
jurisdiction on the courts of the State of Tennessee or the United States
located within the State of Tennessee and expressly waive any objections as to
venue in any such courts. Nothing contained herein shall, however, prevent Bank
from bringing any action or exercising any rights within any other state or
jurisdiction or from obtaining personal jurisdiction by any other means
available under applicable law.
12. PARTIAL INVALIDITY. The unenforceability or invalidity of any provision of
this Note shall not affect the enforceability or validity of any other provision
herein and the invalidity or unenforceability of any provision of this Note or
of the Loan Documents to any person or circumstance shall not affect the
enforceability or validity of such provision as it may apply to other persons or
circumstances.
13. BINDING EFFECT. This Note shall be binding upon and inure to the benefit of
Borrower, Co-Obligors, Obligors and Bank and their respective successors,
assigns, heirs and personal representatives, provided, however, that no
obligations of Borrower, Co-Obligors or Obligors hereunder can be assigned
without prior written consent of Bank.
14. CONTROLLING DOCUMENT. To the extent that this Note conflicts with or is in
any way incompatible with any other document related specifically to the loan
evidenced by this Note, this Note shall control over any other such document
except the Loan Agreement, and if this Note does not address an issue, then each
other such document shall control to the extent that it deals most specifically
with an issue.
15. ARBITRATION. ANY CONTROVERSY OR CLAIM BETWEEN OR AMONG THE PARTIES HERETO
INCLUDING BUT NOT LIMITED TO THOSE ARISING OUT OF OR RELATING TO THIS
INSTRUMENT, AGREEMENT OR DOCUMENT OR ANY RELATED INSTRUMENTS, AGREEMENTS OR
DOCUMENTS, INCLUDING ANY CLAIM BASED ON OR ARISING FROM AN ALLEGED TORT, SHALL
BE DETERMINED BY BINDING ARBITRATION IN ACCORDANCE WITH THE FEDERAL
4
<PAGE> 81
ARBITRATION ACT (OR IF NOT APPLICABLE, THE APPLICABLE STATE LAW), THE RULES OF
PRACTICE AND PROCEDURE FOR THE ARBITRATION OF COMMERCIAL DISPUTES OF
J.A.M.S./ENDISPUTE OR ANY SUCCESSOR THEREOF ("J.A.M.S."), AND THE "SPECIAL
RULES" SET FORTH BELOW. IN THE EVENT OF ANY INCONSISTENCY, THE SPECIAL RULES
SHALL CONTROL. JUDGMENT UPON ANY ARBITRATION AWARD MAY BE ENTERED IN ANY COURT
HAVING JURISDICTION. ANY PARTY TO THIS INSTRUMENT, AGREEMENT OR DOCUMENT MAY
BRING AN ACTION, INCLUDING A SUMMARY OR EXPEDITED PROCEEDING, TO COMPEL
ARBITRATION OF ANY CONTROVERSY OR CLAIM TO WHICH THIS AGREEMENT APPLIES IN ANY
COURT HAVING JURISDICTION OVER SUCH ACTION.
A. SPECIAL RULES. THE ARBITRATION SHALL BE CONDUCTED IN PALM BEACH COUNTY,
FLORIDA, AND ADMINISTERED BY J.A.M.S. WHO WILL APPOINT AN ARBITRATOR; IF
J.A.M.S. IS UNABLE OR LEGALLY PRECLUDED FROM ADMINISTERING THE ARBITRATION, THEN
THE AMERICAN ARBITRATION ASSOCIATION WILL SERVE. ALL ARBITRATION HEARINGS WILL
BE COMMENCED WITHIN 90 DAYS OF THE DEMAND FOR ARBITRATION; FURTHER, THE
ARBITRATOR SHALL ONLY, UPON A SHOWING OF CAUSE, BE PERMITTED TO EXTEND THE
COMMENCEMENT OF SUCH HEARING FOR UP TO AN ADDITIONAL 60 DAYS.
B. RESERVATION OF RIGHTS. NOTHING IN THIS ARBITRATION PROVISION SHALL BE
DEEMED TO (I) LIMIT THE APPLICABILITY OF ANY OTHERWISE APPLICABLE STATUTES OF
LIMITATION OR REPOSE AND ANY WAIVERS CONTAINED IN THIS INSTRUMENT, AGREEMENT OR
DOCUMENT; OR (II) BE A WAIVER BY BANK OF THE PROTECTION AFFORDED TO IT BY 12
U.S.C. SEC. 91 OR ANY SUBSTANTIALLY EQUIVALENT STATE LAW; OR (III) LIMIT THE
RIGHT OF BANK HERETO (A) TO EXERCISE SELF HELP REMEDIES SUCH AS (BUT NOT LIMITED
TO) SETOFF, OR (B) TO FORECLOSE AGAINST ANY REAL OR PERSONAL PROPERTY
COLLATERAL, OR (C) TO OBTAIN FROM A COURT PROVISIONAL OR ANCILLARY REMEDIES SUCH
AS (BUT NOT LIMITED TO) INJUNCTIVE RELIEF, WRIT OF POSSESSION OR THE APPOINTMENT
OF A RECEIVER. BANK MAY EXERCISE SUCH SELF HELP RIGHTS, FORECLOSE UPON SUCH
PROPERTY, OR OBTAIN SUCH PROVISIONAL OR ANCILLARY REMEDIES BEFORE, DURING OR
AFTER THE PENDENCY OF ANY ARBITRATION PROCEEDING BROUGHT PURSUANT TO THIS
INSTRUMENT, AGREEMENT OR DOCUMENT. NEITHER THIS EXERCISE OF SELF HELP REMEDIES
NOR THE INSTITUTION OR MAINTENANCE OF AN ACTION FOR FORECLOSURE OR PROVISIONAL
OR ANCILLARY REMEDIES SHALL CONSTITUTE A WAIVER OF THE RIGHT OF ANY PARTY,
INCLUDING THE CLAIMANT IN ANY SUCH ACTION, TO ARBITRATE THE MERITS OF THE
5
<PAGE> 82
CONTROVERSY OR CLAIM OCCASIONING RESORT TO SUCH REMEDIES.
NOTICE OF FINAL AGREEMENT. THIS WRITTEN PROMISSORY NOTE
REPRESENTS THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT
BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR
SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO
UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.
COOKER RESTAURANT
CORPORATION CGR MANAGEMENT CORPORATION
By: ___________________________ By: ________________________________
Its: __________________________ Its: ________________________________
SOUTHERN COOKER LIMITED
FLORIDA COOKER LP, INC. PARTNERSHIP
By: Cooker Restaurant Corporation,
By: ____________________________ General Partner
Its: ___________________________ By_________________________________
Its: ________________________________
6
<PAGE> 83
STATE OF TENNESSEE )
)
COUNTY OF DAVIDSON )
Before me, the undersigned, a Notary Public of the state and county
aforesaid, personally appeared __________________, with whom I am personally
acquainted, and who, upon oath, acknowledged _____self to be the _______________
of COOKER RESTAURANT CORPORATION, the within named bargainor, a corporation, and
that ___, as such __________________, being authorized so to do, executed the
foregoing instrument for the purposes therein contained, by signing the name of
the corporation by ____self as
_________________.
Witness my hand and seal at office in Nashville, Tennessee, this _____
day of _________, 1998.
-----------------------------
Notary Public
My Commission Expires:
- ---------------------
STATE OF TENNESSEE )
)
COUNTY OF DAVIDSON )
Before me, the undersigned, a Notary Public of the state and county
aforesaid, personally appeared __________________, with whom I am personally
acquainted, and who, upon oath, acknowledged _____self to be the _______________
of CGR MANAGEMENT CORPORATION, the within named bargainor, a corporation, and
that ___, as such __________________, being authorized so to do, executed the
foregoing instrument for the purposes therein contained, by signing the name of
the corporation by ____self as
_________________.
Witness my hand and seal at office in Nashville, Tennessee, this _____
day of _________, 1998.
-----------------------------
Notary Public
My Commission Expires:
7
<PAGE> 84
- ---------------------
STATE OF TENNESSEE )
)
COUNTY OF DAVIDSON )
Before me, the undersigned, a Notary Public of the state and county
aforesaid, personally appeared __________________, with whom I am personally
acquainted, and who, upon oath, acknowledged _____self to be the _______________
of FLORIDA COOKER LP, INC., the within named bargainor, a corporation, and that
___, as such __________________, being authorized so to do, executed the
foregoing instrument for the purposes therein contained, by signing the name of
the corporation by ____self as _________________.
Witness my hand and seal at office in Nashville, Tennessee, this _____
day of _________, 1998.
----------------------------
Notary Public
My Commission Expires:
- ---------------------
STATE OF TENNESSEE )
)
COUNTY OF DAVIDSON )
Before me, the undersigned, a Notary Public of the state and county
aforesaid, personally appeared __________________, with whom I am personally
acquainted, and who, upon oath, acknowledged _____self to be the _______________
of COOKER RESTAURANT CORPORATION, the general partner of SOUTHERN COOKER LIMITED
PARTNERSHIP, the within named bargainor, a limited partnership, and that ___, as
such __________________, being authorized so to do, executed the foregoing
instrument for the purposes therein contained, by signing the name of the
corporation by ____self as _________________.
Witness my hand and seal at office in _______________, Tennessee, this
_____ day of _________, 1998.
-----------------------------
Notary Public
My Commission Expires:
8
<PAGE> 85
RENEWAL TERM LOAN NOTE
<TABLE>
Date: March 24, 1999 Amount: $________________
<S> <C>
======================================================================================================================
BANK: BORROWER:
First Union National Bank Cooker Restaurant Corporation
77 East Camino Real 5500 Village Blvd. - 2nd Floor
2nd Floor West Palm Beach, Palm Beach County, FL
Boca Raton, Florida 33432 33407
CO-OBLIGORS:
CGR
Management Corporation
5500 Village Blvd. - 2nd Floor
West Palm Beach, FL 33407
Florida Cooker LP, Inc.
5500 Village Blvd. - 2nd Floor
West Palm Beach, FL 33407
Southern Cooker Limited Partnership
5500 Village Blvd. - 2nd Floor
West Palm Beach, FL 33407
======================================================================================================================
</TABLE>
FOR VALUE RECEIVED, the undersigned Borrower and Co-Obligors, jointly and
severally, unconditionally promise to pay to the order of Bank, its successors
and assigns, without setoff, at its offices indicated at the beginning of this
Note, or at such other place as may be designated by Bank, the principal amount
of ____________________________ and 00/100 Dollars ($________________) or so
much thereof as may be advanced from time to time in immediately available
funds, together with interest computed daily on the outstanding principal
balance hereunder, at an annual interest rate, and in accordance with the
payment schedule, indicated below. This Note is one of the Renewal Term Loan
Notes made pursuant to that Loan Agreement dated September 24, 1998 between
Borrower, Co-Obligors and NationsBank of Tennessee, N.A., as Agent for itself
and First Union National Bank ("Loan Agreement"). Capitalized terms not defined
herein shall have the meaning contained in the Loan Agreement.
This is an amendment, restatement, modification and renewal of a portion of
the indebtedness owed by Borrower to Bank evidenced by that Promissory Note in
the original principal amount of $33,000,000.00 dated the 26th day of August,
1991 as amended.
1. RATE. The rate shall be as provided in the Loan Agreement.
Notwithstanding any provision of this Note, Bank does not intend to charge and
Borrower and Co-Obligors shall not be required to pay any amount of interest or
other charges in excess of the
<PAGE> 86
maximum permitted by the applicable law of the State of Tennessee; if any higher
rate ceiling is lawful, then that higher rate ceiling shall apply. Any payment
in excess of such maximum shall be refunded to Borrower and Co-Obligors or
credited against principal, at the option of Bank.
2. ACCRUAL METHOD. Interest at the Rate set forth above will be calculated by
the 365/360 day method (a daily amount of interest is computed for a
hypothetical year of 360 days; that amount is multiplied by the actual number of
days for which any principal is outstanding hereunder).
3. PAYMENT SCHEDULE. All payments received hereunder shall be applied first to
the payment of any expense or charges payable hereunder or under any other loan
documents executed in connection with this Note, then to interest due and
payable, with the balance applied to principal, or in such other order as Bank
shall determine at its option.
Payments shall be made on the dates and in the amounts set forth in the Loan
Agreement. The maturity date of this Note is March 24, 2004, subject to the
provisions of Section 5 of the Loan Agreement.
4. WAIVERS, CONSENTS AND COVENANTS. Subject to any applicable cure periods,
Borrower and Co-Obligors, any indorser or guarantor hereof, or any other party
hereto (individually an "Obligor" and collectively "Obligors") and each of them
jointly and severally: (a) waive presentment, demand, protest, notice of demand,
notice of intent to accelerate, notice of acceleration of maturity, notice of
protest, notice of nonpayment, notice of dishonor, and any other notice required
to be given under the law to any Obligor in connection with the delivery,
acceptance, performance, default or enforcement of this Note, any indorsement or
guaranty of this Note, or any other documents executed in connection with this
Note or any other note or other loan documents now or hereafter executed in
connection with any obligation of Borrower and Co-Obligors to Bank (the "Loan
Documents"); (b) consent to all delays, extensions, renewals or other
modifications of this Note or the Loan Documents, or waivers of any term hereof
or of the Loan Documents, or release or discharge by Bank of any of Obligors, or
release, substitution or exchange of any security for the payment hereof, or the
failure to act on the part of Bank, or any indulgence shown by Bank (without
notice to or further assent from any of Obligors), and agree that no such
action, failure to act or failure to exercise any right or remedy by Bank shall
in any way affect or impair the obligations of any Obligors or be construed as a
waiver by Bank of, or otherwise affect, any of Bank's rights under this Note,
under any indorsement or guaranty of this Note or under any of the Loan
Documents; and (c) agree to pay, on demand, all reasonable costs and expenses of
collection or defense of this Note or of any indorsement or guaranty hereof
and/or the enforcement or defense of Bank's rights with respect to, or the
administration, supervision, preservation, or protection of, or realization
upon, any property securing payment hereof, including, without limitation,
reasonable attorney's fees, including fees related to any suit, mediation or
arbitration proceeding, out of court payment agreement, trial, appeal,
bankruptcy proceedings or other proceeding, in such amount as may be determined
reasonable by any arbitrator or court, whichever is applicable.
5. PREPAYMENTS. Voluntary prepayments of principal or accrued interest may be
made, in whole or in part, at any time without penalty, except, in the case of a
LIBOR Rate borrowing, a payment
2
<PAGE> 87
prior to the end of the LIBOR Period will require Borrower and Co-Obligors to
pay Bank any breakage costs associated with such prepayment.
6. DELINQUENCY CHARGE. To the extent permitted by law, a delinquency charge may
be imposed in an amount not to exceed four percent (4%) of any payment that is
more than fifteen days late.
7. EVENTS OF DEFAULT. The following are events of default hereunder: subject to
any applicable notice or cure period, (a) the failure to pay any obligation,
liability or indebtedness of any Obligor to Bank, whether under this Note, the
Loan Agreement or any Loan Documents, within five (5) days of the date when due
(whether upon demand, at maturity or by acceleration), provided, however, that
Borrower and Co-Obligors shall not be in Default as a result of a missed
interest payment if a Lender has failed to deliver to Borrower an interest
statement for such payment; (b) a Default as defined in the Loan Agreement.
8. REMEDIES UPON DEFAULT. Whenever there is a default under this Note (a) the
entire balance outstanding hereunder and all other obligations of any Obligor to
Bank (however acquired or evidenced) shall, at the option of Bank, become
immediately due and payable and any obligation of Bank to permit further
borrowing under this Note shall immediately cease and terminate, and/or (b) to
the extent permitted by law, the Rate of interest on the unpaid principal shall
be increased to the Default Rate as defined in the Loan Agreement. The
provisions herein for a Default Rate shall not be deemed to extend the time for
any payment hereunder or to constitute a "grace period" giving Obligors a right
to cure any default. At Bank's option, and to the extent permitted by law, any
accrued and unpaid interest, fees or charges may, for purposes of computing and
accruing interest on a daily basis after the due date of the Note or any
installment thereof, be deemed to be a part of the principal balance, and
interest shall accrue on a daily compounded basis after such date at the Default
Rate provided in this Note until the entire outstanding balance of principal and
interest is paid in full. Upon a default under this Note, Bank is hereby
authorized at any time, at its option and without notice or demand, to set off
and charge against any deposit accounts of any Obligor, (as well as any money,
instruments, securities, documents, chattel paper, credits, claims, demands,
income and any other property, rights and interests of any Obligor), which at
any time shall come into the possession or custody or under the control of Bank
or any of its agents, affiliates or correspondents, any and all obligations due
hereunder. Additionally, Bank shall have all rights and remedies available under
each of the Loan Documents, as well as all rights and remedies available at law
or in equity.
9. NON-WAIVER. The failure at any time of Bank to exercise any of its options or
any other rights hereunder shall not constitute a waiver thereof, nor shall it
be a bar to the exercise of any of its options or rights at a later date. All
rights and remedies of Bank shall be cumulative and may be pursued singly,
successively or together, at the option of Bank. The acceptance by Bank of any
partial payment shall not constitute a waiver of any default or of any of Bank's
rights under this Note. No waiver of any of its rights hereunder, and no
modification or amendment of this Note, shall be deemed to be made by Bank
unless the same shall be in writing, duly signed on behalf of Bank; each such
waiver shall apply only with respect to the specific instance involved, and
shall in no way impair the rights of Bank or the obligations of Obligors to Bank
in any other respect at any
3
<PAGE> 88
other time.
10. APPLICABLE LAW, VENUE AND JURISDICTION. This Note and the rights and
obligations of Borrower, Co-Obligors and Bank under this Note shall be governed
by and interpreted in accordance with the law of the State of Tennessee. Except
for proceedings to enforce any mortgage, deed of trust, security agreement or
other collateral document, in any litigation in connection with or to enforce
this Note or any indorsement or guaranty of this Note or any Loan Documents,
Obligors, and each of them, irrevocably consent to and confer personal
jurisdiction on the courts of the State of Tennessee or the United States
located within the State of Tennessee and expressly waive any objections as to
venue in any such courts. Nothing contained herein shall, however, prevent Bank
from bringing any action or exercising any rights within any other state or
jurisdiction or from obtaining personal jurisdiction by any other means
available under applicable law.
11. PARTIAL INVALIDITY. The unenforceability or invalidity of any provision of
this Note shall not affect the enforceability or validity of any other provision
herein and the invalidity or unenforceability of any provision of this Note or
of the Loan Documents to any person or circumstance shall not affect the
enforceability or validity of such provision as it may apply to other persons or
circumstances.
12. BINDING EFFECT. This Note shall be binding upon and inure to the benefit of
Borrower, Co-Obligors, Obligors and Bank and their respective successors,
assigns, heirs and personal representatives, provided, however, that no
obligations of Borrower, Co-Obligors or Obligors hereunder can be assigned
without prior written consent of Bank.
13. CONTROLLING DOCUMENT. To the extent that this Note conflicts with or is in
any way incompatible with any other document related specifically to the loan
evidenced by this Note, this Note shall control over any other such document
except the Loan Agreement, and if this Note does not address an issue, then each
other such document shall control to the extent that it deals most specifically
with an issue.
14. ARBITRATION. ANY CONTROVERSY OR CLAIM BETWEEN OR AMONG THE PARTIES HERETO
INCLUDING BUT NOT LIMITED TO THOSE ARISING OUT OF OR RELATING TO THIS
INSTRUMENT, AGREEMENT OR DOCUMENT OR ANY RELATED INSTRUMENTS, AGREEMENTS OR
DOCUMENTS, INCLUDING ANY CLAIM BASED ON OR ARISING FROM AN ALLEGED TORT, SHALL
BE DETERMINED BY BINDING ARBITRATION IN ACCORDANCE WITH THE FEDERAL ARBITRATION
ACT (OR IF NOT APPLICABLE, THE APPLICABLE STATE LAW), THE RULES OF PRACTICE AND
PROCEDURE FOR THE ARBITRATION OF COMMERCIAL DISPUTES OF J.A.M.S./ENDISPUTE OR
ANY SUCCESSOR THEREOF ("J.A.M.S."), AND THE "SPECIAL RULES" SET FORTH BELOW. IN
THE EVENT OF ANY INCONSISTENCY, THE SPECIAL RULES SHALL CONTROL. JUDGMENT UPON
ANY ARBITRATION AWARD MAY BE ENTERED IN ANY COURT HAVING JURISDICTION. ANY PARTY
TO THIS INSTRUMENT, AGREEMENT OR DOCUMENT MAY BRING AN ACTION, INCLUDING A
SUMMARY OR EXPEDITED PROCEEDING,
4
<PAGE> 89
TO COMPEL ARBITRATION OF ANY CONTROVERSY OR CLAIM TO WHICH THIS
AGREEMENT APPLIES IN ANY COURT HAVING JURISDICTION OVER SUCH
ACTION.
A. SPECIAL RULES. THE ARBITRATION SHALL BE CONDUCTED IN PALM BEACH COUNTY,
FLORIDA, AND ADMINISTERED BY J.A.M.S. WHO WILL APPOINT AN ARBITRATOR; IF
J.A.M.S. IS UNABLE OR LEGALLY PRECLUDED FROM ADMINISTERING THE ARBITRATION, THEN
THE AMERICAN ARBITRATION ASSOCIATION WILL SERVE. ALL ARBITRATION HEARINGS WILL
BE COMMENCED WITHIN 90 DAYS OF THE DEMAND FOR ARBITRATION; FURTHER, THE
ARBITRATOR SHALL ONLY, UPON A SHOWING OF CAUSE, BE PERMITTED TO EXTEND THE
COMMENCEMENT OF SUCH HEARING FOR UP TO AN ADDITIONAL 60 DAYS.
B. RESERVATION OF RIGHTS. NOTHING IN THIS ARBITRATION PROVISION SHALL BE
DEEMED TO (I) LIMIT THE APPLICABILITY OF ANY OTHERWISE APPLICABLE STATUTES OF
LIMITATION OR REPOSE AND ANY WAIVERS CONTAINED IN THIS INSTRUMENT, AGREEMENT OR
DOCUMENT; OR (II) BE A WAIVER BY BANK OF THE PROTECTION AFFORDED TO IT BY 12
U.S.C. SEC. 91 OR ANY SUBSTANTIALLY EQUIVALENT STATE LAW; OR (III) LIMIT THE
RIGHT OF BANK HERETO (A) TO EXERCISE SELF HELP REMEDIES SUCH AS (BUT NOT LIMITED
TO) SETOFF, OR (B) TO FORECLOSE AGAINST ANY REAL OR PERSONAL PROPERTY
COLLATERAL, OR (C) TO OBTAIN FROM A COURT PROVISIONAL OR ANCILLARY REMEDIES SUCH
AS (BUT NOT LIMITED TO) INJUNCTIVE RELIEF, WRIT OF POSSESSION OR THE APPOINTMENT
OF A RECEIVER. BANK MAY EXERCISE SUCH SELF HELP RIGHTS, FORECLOSE UPON SUCH
PROPERTY, OR OBTAIN SUCH PROVISIONAL OR ANCILLARY REMEDIES BEFORE, DURING OR
AFTER THE PENDENCY OF ANY ARBITRATION PROCEEDING BROUGHT PURSUANT TO THIS
INSTRUMENT, AGREEMENT OR DOCUMENT. NEITHER THIS EXERCISE OF SELF HELP REMEDIES
NOR THE INSTITUTION OR MAINTENANCE OF AN ACTION FOR FORECLOSURE OR PROVISIONAL
OR ANCILLARY REMEDIES SHALL CONSTITUTE A WAIVER OF THE RIGHT OF ANY PARTY,
INCLUDING THE CLAIMANT IN ANY SUCH ACTION, TO ARBITRATE THE MERITS OF THE
CONTROVERSY OR CLAIM OCCASIONING RESORT TO SUCH REMEDIES.
NOTICE OF FINAL AGREEMENT. THIS WRITTEN PROMISSORY NOTE REPRESENTS THE FINAL
AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR,
CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO
UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.
5
<PAGE> 90
COOKER RESTAURANT
CORPORATION CGR MANAGEMENT CORPORATION
By: __________________________ By: ________________________________
Its: _________________________ Its: ________________________________
SOUTHERN COOKER LIMITED
FLORIDA COOKER LP, INC. PARTNERSHIP
By: Cooker Restaurant Corporation,
By: ___________________________ General Partner
Its: __________________________ By_________________________________
Its: ________________________________
6
<PAGE> 91
STATE OF TENNESSEE )
)
COUNTY OF DAVIDSON )
Before me, the undersigned, a Notary Public of the state and county
aforesaid, personally appeared __________________, with whom I am personally
acquainted, and who, upon oath, acknowledged _____self to be the _______________
of COOKER RESTAURANT CORPORATION, the within named bargainor, a corporation, and
that ___, as such __________________, being authorized so to do, executed the
foregoing instrument for the purposes therein contained, by signing the name of
the corporation by ____self as
_________________.
Witness my hand and seal at office in Nashville, Tennessee, this _____
day of _________, 1998.
-----------------------------
Notary Public
My Commission Expires:
- ---------------------
STATE OF TENNESSEE )
)
COUNTY OF DAVIDSON )
Before me, the undersigned, a Notary Public of the state and county
aforesaid, personally appeared __________________, with whom I am personally
acquainted, and who, upon oath, acknowledged _____self to be the _______________
of CGR MANAGEMENT CORPORATION, the within named bargainor, a corporation, and
that ___, as such __________________, being authorized so to do, executed the
foregoing instrument for the purposes therein contained, by signing the name of
the corporation by ____self as
_________________.
Witness my hand and seal at office in Nashville, Tennessee, this _____
day of _________, 1998.
-----------------------------
Notary Public
My Commission Expires:
- ---------------------
7
<PAGE> 92
STATE OF TENNESSEE )
)
COUNTY OF DAVIDSON )
Before me, the undersigned, a Notary Public of the state and county
aforesaid, personally appeared __________________, with whom I am personally
acquainted, and who, upon oath, acknowledged _____self to be the _______________
of FLORIDA COOKER LP, INC., the within named bargainor, a corporation, and that
___, as such __________________, being authorized so to do, executed the
foregoing instrument for the purposes therein contained, by signing the name of
the corporation by ____self as _________________.
Witness my hand and seal at office in Nashville, Tennessee, this _____
day of _________, 1998.
----------------------------
Notary Public
My Commission Expires:
- ---------------------
STATE OF TENNESSEE )
)
COUNTY OF DAVIDSON )
Before me, the undersigned, a Notary Public of the state and county
aforesaid, personally appeared __________________, with whom I am personally
acquainted, and who, upon oath, acknowledged _____self to be the _______________
of COOKER RESTAURANT CORPORATION, the general partner of SOUTHERN COOKER LIMITED
PARTNERSHIP, the within named bargainor, a limited partnership, and that ___, as
such __________________, being authorized so to do, executed the foregoing
instrument for the purposes therein contained, by signing the name of the
corporation by ____self as _________________.
Witness my hand and seal at office in _______________, Tennessee, this
_____ day of _________, 1998.
-----------------------------
Notary Public
My Commission Expires:
- ---------------------
8
<PAGE> 93
RENEWAL TERM LOAN NOTE
<TABLE>
Date: March 24, 1999 Amount: $ ________________
<S> <C>
======================================================================================================================
BANK: BORROWER:
NationsBank of Tennessee, N.A. Cooker Restaurant Corporation
Commercial Lending - 2nd Floor 5500 Village Blvd. - 2nd Floor
One NationsBank Plaza West Palm Beach, Palm Beach County, FL
Nashville, Davidson County, TN 37239 33407
CO-OBLIGORS:
CGR
Management Corporation
5500 Village Blvd. - 2nd Floor
West Palm Beach, FL 33407
Florida Cooker LP, Inc.
5500 Village Blvd. - 2nd Floor
West Palm Beach, FL 33407
Southern Cooker Limited Partnership
5500 Village Blvd. - 2nd Floor
West Palm Beach, FL 33407
======================================================================================================================
</TABLE>
FOR VALUE RECEIVED, the undersigned Borrower and Co-Obligors, jointly and
severally, unconditionally promise to pay to the order of Bank, its successors
and assigns, without setoff, at its offices indicated at the beginning of this
Note, or at such other place as may be designated by Bank, the principal amount
of ___________________________ Dollars ($_______________), or so much thereof as
may be advanced from time to time in immediately available funds, together with
interest computed daily on the outstanding principal balance hereunder, at an
annual interest rate, and in accordance with the payment schedule, indicated
below. This Note is one of the Renewal Term Loan Notes made pursuant to that
Loan Agreement dated September 24, 1998 between Borrower, Co-Obligors and
NationsBank of Tennessee, N.A., as Agent for itself and First Union National
Bank ("Loan Agreement"). Capitalized terms not defined herein shall have the
meaning contained in the Loan Agreement.
1. RATE. The rate shall be as provided in the Loan Agreement.
Notwithstanding any provision of this Note, Bank does not intend to charge and
Borrower and Co-Obligors shall not be required to pay any amount of interest or
other charges in excess of the maximum permitted by the applicable law of the
State of Tennessee; if any higher rate ceiling is
1
<PAGE> 94
lawful, then that higher rate ceiling shall apply. Any payment in excess of such
maximum shall be refunded to Borrower and Co-Obligors or credited against
principal, at the option of Bank.
2. ACCRUAL METHOD. Interest at the Rate set forth above will be calculated by
the 365/360 day method (a daily amount of interest is computed for a
hypothetical year of 360 days; that amount is multiplied by the actual number of
days for which any principal is outstanding hereunder).
3. PAYMENT SCHEDULE. All payments received hereunder shall be applied first to
the payment of any expense or charges payable hereunder or under any other loan
documents executed in connection with this Note, then to interest due and
payable, with the balance applied to principal, or in such other order as Bank
shall determine at its option.
Payments shall be made on the dates and in the amounts set forth in the Loan
Agreement. The maturity date of this Note is March 24, 2004, subject to the
provisions of Section 5 of the Loan Agreement.
4. WAIVERS, CONSENTS AND COVENANTS. Subject to any applicable cure periods,
Borrower and Co-Obligors, any indorser or guarantor hereof, or any other party
hereto (individually an "Obligor" and collectively "Obligors") and each of them
jointly and severally: (a) waive presentment, demand, protest, notice of demand,
notice of intent to accelerate, notice of acceleration of maturity, notice of
protest, notice of nonpayment, notice of dishonor, and any other notice required
to be given under the law to any Obligor in connection with the delivery,
acceptance, performance, default or enforcement of this Note, any indorsement or
guaranty of this Note, or any other documents executed in connection with this
Note or any other note or other loan documents now or hereafter executed in
connection with any obligation of Borrower and Co-Obligors to Bank (the "Loan
Documents"); (b) consent to all delays, extensions, renewals or other
modifications of this Note or the Loan Documents, or waivers of any term hereof
or of the Loan Documents, or release or discharge by Bank of any of Obligors, or
release, substitution or exchange of any security for the payment hereof, or the
failure to act on the part of Bank, or any indulgence shown by Bank (without
notice to or further assent from any of Obligors), and agree that no such
action, failure to act or failure to exercise any right or remedy by Bank shall
in any way affect or impair the obligations of any Obligors or be construed as a
waiver by Bank of, or otherwise affect, any of Bank's rights under this Note,
under any indorsement or guaranty of this Note or under any of the Loan
Documents; and (c) agree to pay, on demand, all reasonable costs and expenses of
collection or defense of this Note or of any indorsement or guaranty hereof
and/or the enforcement or defense of Bank's rights with respect to, or the
administration, supervision, preservation, or protection of, or realization
upon, any property securing payment hereof, including, without limitation,
reasonable attorney's fees, including fees related to any suit, mediation or
arbitration proceeding, out of court payment agreement, trial, appeal,
bankruptcy proceedings or other proceeding, in such amount as may be determined
reasonable by any arbitrator or court, whichever is applicable.
5. PREPAYMENTS. Voluntary prepayments of principal or accrued interest may be
made, in whole or in part, at any time without penalty, except, in the case of a
LIBOR Rate borrowing, a payment prior to the end of the LIBOR Period will
require Borrower and Co-Obligors to pay Bank any breakage costs associated with
such prepayment.
6. DELINQUENCY CHARGE. To the extent permitted by law, a delinquency charge may
be imposed
<PAGE> 95
in an amount not to exceed four percent (4%) of any payment that is more than
fifteen days late.
7. EVENTS OF DEFAULT. The following are events of default hereunder: subject to
any applicable notice or cure period, (a) the failure to pay any obligation,
liability or indebtedness of any Obligor to Bank, whether under this Note, the
Loan Agreement or any Loan Documents, within five (5) days of the date when due
(whether upon demand, at maturity or by acceleration), provided, however, that
Borrower and Co-Obligors shall not be in Default as a result of a missed
interest payment if a Lender has failed to deliver to Borrower an interest
statement for such payment; (b) a Default as defined in the Loan Agreement.
8. REMEDIES UPON DEFAULT. Whenever there is a default under this Note (a) the
entire balance outstanding hereunder and all other obligations of any Obligor to
Bank (however acquired or evidenced) shall, at the option of Bank, become
immediately due and payable and any obligation of Bank to permit further
borrowing under this Note shall immediately cease and terminate, and/or (b) to
the extent permitted by law, the Rate of interest on the unpaid principal shall
be increased to the Default Rate as defined in the Loan Agreement. The
provisions herein for a Default Rate shall not be deemed to extend the time for
any payment hereunder or to constitute a "grace period" giving Obligors a right
to cure any default. At Bank's option, and to the extent permitted by law, any
accrued and unpaid interest, fees or charges may, for purposes of computing and
accruing interest on a daily basis after the due date of the Note or any
installment thereof, be deemed to be a part of the principal balance, and
interest shall accrue on a daily compounded basis after such date at the Default
Rate provided in this Note until the entire outstanding balance of principal and
interest is paid in full. Upon a default under this Note, Bank is hereby
authorized at any time, at its option and without notice or demand, to set off
and charge against any deposit accounts of any Obligor, (as well as any money,
instruments, securities, documents, chattel paper, credits, claims, demands,
income and any other property, rights and interests of any Obligor), which at
any time shall come into the possession or custody or under the control of Bank
or any of its agents, affiliates or correspondents, any and all obligations due
hereunder. Additionally, Bank shall have all rights and remedies available under
each of the Loan Documents, as well as all rights and remedies available at law
or in equity.
9. NON-WAIVER. The failure at any time of Bank to exercise any of its options or
any other rights hereunder shall not constitute a waiver thereof, nor shall it
be a bar to the exercise of any of its options or rights at a later date. All
rights and remedies of Bank shall be cumulative and may be pursued singly,
successively or together, at the option of Bank. The acceptance by Bank of any
partial payment shall not constitute a waiver of any default or of any of Bank's
rights under this Note. No waiver of any of its rights hereunder, and no
modification or amendment of this Note, shall be deemed to be made by Bank
unless the same shall be in writing, duly signed on behalf of Bank; each such
waiver shall apply only with respect to the specific instance involved, and
shall in no way impair the rights of Bank or the obligations of Obligors to Bank
in any other respect at any other time.
10. APPLICABLE LAW, VENUE AND JURISDICTION. This Note and the rights and
obligations of Borrower, Co-Obligors and Bank under this Note shall be governed
by and interpreted in accordance
3
<PAGE> 96
with the law of the State of Tennessee. Except for proceedings to enforce any
mortgage, deed of trust, security agreement or other collateral document, in any
litigation in connection with or to enforce this Note or any indorsement or
guaranty of this Note or any Loan Documents, Obligors, and each of them,
irrevocably consent to and confer personal jurisdiction on the courts of the
State of Tennessee or the United States located within the State of Tennessee
and expressly waive any objections as to venue in any such courts. Nothing
contained herein shall, however, prevent Bank from bringing any action or
exercising any rights within any other state or jurisdiction or from obtaining
personal jurisdiction by any other means available under applicable law.
11. PARTIAL INVALIDITY. The unenforceability or invalidity of any provision of
this Note shall not affect the enforceability or validity of any other provision
herein and the invalidity or unenforceability of any provision of this Note or
of the Loan Documents to any person or circumstance shall not affect the
enforceability or validity of such provision as it may apply to other persons or
circumstances.
12. BINDING EFFECT. This Note shall be binding upon and inure to the benefit of
Borrower, Co- Obligors, Obligors and Bank and their respective successors,
assigns, heirs and personal representatives, provided, however, that no
obligations of Borrower, Co-Obligors or Obligors hereunder can be assigned
without prior written consent of Bank.
13. CONTROLLING DOCUMENT. To the extent that this Note conflicts with or is in
any way incompatible with any other document related specifically to the loan
evidenced by this Note, this Note shall control over any other such document
except the Loan Agreement, and if this Note does not address an issue, then each
other such document shall control to the extent that it deals most specifically
with an issue.
14. ARBITRATION. ANY CONTROVERSY OR CLAIM BETWEEN OR AMONG THE PARTIES HERETO
INCLUDING BUT NOT LIMITED TO THOSE ARISING OUT OF OR RELATING TO THIS
INSTRUMENT, AGREEMENT OR DOCUMENT OR ANY RELATED INSTRUMENTS, AGREEMENTS OR
DOCUMENTS, INCLUDING ANY CLAIM BASED ON OR ARISING FROM AN ALLEGED TORT, SHALL
BE DETERMINED BY BINDING ARBITRATION IN ACCORDANCE WITH THE FEDERAL ARBITRATION
ACT (OR IF NOT APPLICABLE, THE APPLICABLE STATE LAW), THE RULES OF PRACTICE AND
PROCEDURE FOR THE ARBITRATION OF COMMERCIAL DISPUTES OF J.A.M.S./ENDISPUTE OR
ANY SUCCESSOR THEREOF ("J.A.M.S."), AND THE "SPECIAL RULES" SET FORTH BELOW. IN
THE EVENT OF ANY INCONSISTENCY, THE SPECIAL RULES SHALL CONTROL. JUDGMENT UPON
ANY ARBITRATION AWARD MAY BE ENTERED IN ANY COURT HAVING JURISDICTION. ANY PARTY
TO THIS INSTRUMENT, AGREEMENT OR DOCUMENT MAY BRING AN ACTION, INCLUDING A
SUMMARY OR EXPEDITED PROCEEDING, TO COMPEL ARBITRATION OF ANY CONTROVERSY OR
CLAIM TO WHICH THIS AGREEMENT APPLIES IN ANY COURT HAVING JURISDICTION OVER SUCH
ACTION.
4
<PAGE> 97
A. SPECIAL RULES. THE ARBITRATION SHALL BE CONDUCTED IN PALM BEACH COUNTY,
FLORIDA, AND ADMINISTERED BY J.A.M.S. WHO WILL APPOINT AN ARBITRATOR; IF
J.A.M.S. IS UNABLE OR LEGALLY PRECLUDED FROM ADMINISTERING THE ARBITRATION, THEN
THE AMERICAN ARBITRATION ASSOCIATION WILL SERVE. ALL ARBITRATION HEARINGS WILL
BE COMMENCED WITHIN 90 DAYS OF THE DEMAND FOR ARBITRATION; FURTHER, THE
ARBITRATOR SHALL ONLY, UPON A SHOWING OF CAUSE, BE PERMITTED TO EXTEND THE
COMMENCEMENT OF SUCH HEARING FOR UP TO AN ADDITIONAL 60 DAYS.
B. RESERVATION OF RIGHTS. NOTHING IN THIS ARBITRATION PROVISION SHALL BE
DEEMED TO (I) LIMIT THE APPLICABILITY OF ANY OTHERWISE APPLICABLE STATUTES OF
LIMITATION OR REPOSE AND ANY WAIVERS CONTAINED IN THIS INSTRUMENT, AGREEMENT OR
DOCUMENT; OR (II) BE A WAIVER BY BANK OF THE PROTECTION AFFORDED TO IT BY 12
U.S.C. SEC. 91 OR ANY SUBSTANTIALLY EQUIVALENT STATE LAW; OR (III) LIMIT THE
RIGHT OF BANK HERETO (A) TO EXERCISE SELF HELP REMEDIES SUCH AS (BUT NOT LIMITED
TO) SETOFF, OR (B) TO FORECLOSE AGAINST ANY REAL OR PERSONAL PROPERTY
COLLATERAL, OR (C) TO OBTAIN FROM A COURT PROVISIONAL OR ANCILLARY REMEDIES SUCH
AS (BUT NOT LIMITED TO) INJUNCTIVE RELIEF, WRIT OF POSSESSION OR THE APPOINTMENT
OF A RECEIVER. BANK MAY EXERCISE SUCH SELF HELP RIGHTS, FORECLOSE UPON SUCH
PROPERTY, OR OBTAIN SUCH PROVISIONAL OR ANCILLARY REMEDIES BEFORE, DURING OR
AFTER THE PENDENCY OF ANY ARBITRATION PROCEEDING BROUGHT PURSUANT TO THIS
INSTRUMENT, AGREEMENT OR DOCUMENT. NEITHER THIS EXERCISE OF SELF HELP REMEDIES
NOR THE INSTITUTION OR MAINTENANCE OF AN ACTION FOR FORECLOSURE OR PROVISIONAL
OR ANCILLARY REMEDIES SHALL CONSTITUTE A WAIVER OF THE RIGHT OF ANY PARTY,
INCLUDING THE CLAIMANT IN ANY SUCH ACTION, TO ARBITRATE THE MERITS OF THE
CONTROVERSY OR CLAIM OCCASIONING RESORT TO SUCH REMEDIES.
NOTICE OF FINAL AGREEMENT. THIS WRITTEN PROMISSORY NOTE REPRESENTS THE FINAL
AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR,
CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO
UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.
COOKER RESTAURANT
CORPORATION CGR MANAGEMENT CORPORATION
By: ________________________________ By: _______________________________
Its: ________________________________ Its: ______________________________
5
<PAGE> 98
SOUTHERN COOKER LIMITED
FLORIDA COOKER LP, INC. PARTNERSHIP
By: Cooker Restaurant Corporation,
By: ________________________________ General Partner
Its: ________________________________ By_________________________________
Its: ______________________________
6
<PAGE> 99
STATE OF TENNESSEE )
)
COUNTY OF DAVIDSON )
Before me, the undersigned, a Notary Public of the state and county
aforesaid, personally appeared __________________, with whom I am personally
acquainted, and who, upon oath, acknowledged _____self to be the _______________
of COOKER RESTAURANT CORPORATION, the within named bargainor, a corporation, and
that ___, as such __________________, being authorized so to do, executed the
foregoing instrument for the purposes therein contained, by signing the name of
the corporation by ____self as
_________________.
Witness my hand and seal at office in Nashville, Tennessee, this _____
day of _________, 1998.
-----------------------------
Notary Public
My Commission Expires:
- ---------------------
STATE OF TENNESSEE )
)
COUNTY OF DAVIDSON )
Before me, the undersigned, a Notary Public of the state and county
aforesaid, personally appeared __________________, with whom I am personally
acquainted, and who, upon oath, acknowledged _____self to be the _______________
of CGR MANAGEMENT CORPORATION, the within named bargainor, a corporation, and
that ___, as such __________________, being authorized so to do, executed the
foregoing instrument for the purposes therein contained, by signing the name of
the corporation by ____self as
_________________.
Witness my hand and seal at office in Nashville, Tennessee, this _____
day of _________, 1998.
-----------------------------
Notary Public
My Commission Expires:
- ---------------------
7
<PAGE> 100
STATE OF TENNESSEE )
)
COUNTY OF DAVIDSON )
Before me, the undersigned, a Notary Public of the state and county
aforesaid, personally appeared __________________, with whom I am personally
acquainted, and who, upon oath, acknowledged _____self to be the _______________
of FLORIDA COOKER LP, INC., the within named bargainor, a corporation, and that
___, as such __________________, being authorized so to do, executed the
foregoing instrument for the purposes therein contained, by signing the name of
the corporation by ____self as _________________.
Witness my hand and seal at office in Nashville, Tennessee, this _____
day of _________, 1998.
----------------------------
Notary Public
My Commission Expires:
- ---------------------
STATE OF TENNESSEE )
)
COUNTY OF DAVIDSON )
Before me, the undersigned, a Notary Public of the state and county
aforesaid, personally appeared __________________, with whom I am personally
acquainted, and who, upon oath, acknowledged _____self to be the _______________
of COOKER RESTAURANT CORPORATION, the general partner of SOUTHERN COOKER LIMITED
PARTNERSHIP, the within named bargainor, a limited partnership, and that ___, as
such __________________, being authorized so to do, executed the foregoing
instrument for the purposes therein contained, by signing the name of the
corporation by ____self as _________________.
Witness my hand and seal at office in _______________, Tennessee, this
_____ day of _________, 1998.
-----------------------------
Notary Public
My Commission Expires:
- ---------------------
8
<PAGE> 1
Exhibit 10.21
MASTER SECURITY AGREEMENT
This Master Security Agreement provides a set of terms and conditions that the
parties hereto intend to be applicable to various loan transactions secured by
personal property. Each such loan and security agreement shall be evidenced by a
schedule of indebtedness and collateral ("Schedule") executed by Secured Party
and Debtor that explicitly incorporates the provisions of this Master Security
Agreement and that sets forth specific terms of that particular loan and
security contract. Where the provisions of a Schedule conflict with the terms
hereof, the provisions of the Schedule shall prevail. Each Schedule shall
constitute a complete and separate loan and security agreement, independent of
all other Schedules, and without any requirement of being accompanied by an
originally executed copy of this Master Security Agreement. The term "Security
Agreement' when used herein shall refer to an individual Schedule.
One originally executed copy of the Schedule shall be denominated "Originally
Executed Copy No. 1 of 1 originally executed copies" and such copy shall be
retained by Secured Party. If more than one copy of the Schedule is executed by
Secured Party and Debtor, all such other copies shall be numbered consecutively
with numbers greater than 1. Only transfer of possession by Secured Party of
Originally Executed Copy No. 1 shall be effective for purposes of perfecting an
interest in such Schedule by possession.
1. GRANT OF SECURITY INTEREST; DESCRIPTION OF COLLATERAL.
Debtor grants to Secured Party a security interest in the property described in
the Schedules now or hereafter executed by or pursuant to the authority of the
Debtor and accepted by Secured Party in writing, along with all present and
future attachments and accessories thereto and replacements and proceeds
thereof, including amounts payable under any insurance policy, all hereinafter
referred to collectively as "Collateral." Each Schedule shall be serially
numbered. Unless and only to the extent otherwise expressly provided in a
Schedule, no Schedule shall replace any previous Schedule but shall be
supplementary to all previous Schedules.
2. WHAT OBLIGATIONS THE COLLATERAL SECURES.
EACH ITEM OF COLLATERAL SHALL SECURE NOT ONLY THE SPECIFIC AMOUNT WHICH DEBTOR
PROMISES TO PAY IN EACH SCHEDULE, BUT ALSO ALL OTHER PRESENT AND FUTURE
INDEBTEDNESS OR OBLIGATIONS OF DEBTOR TO SECURED PARTY OF EVERY KIND AND NATURE
WHATSOEVER.
3. PROMISE TO PAY; TERMS AND PLACE OF PAYMENT.
<PAGE> 2
Debtor promises to pay Secured Party the amounts set forth on each Schedule at
the rate and upon such terms as provided therein.
4. USE AND LOCATION OF COLLATERAL.
Debtor warrants and agrees that the Collateral is to be used primarily for:
X business or commercial purposes (other than agricultural),
agricultural purposes (see definition on the final page), or both
agricultural and business or commercial purposes.
Location: See Exhibit "A" attached to Schedule No. I
----------------------------------------------------------------------
Address City County State Zip Code
Debtor and Secured Party agree that regardless of the manner of affixation, the
Collateral shall remain personal property and not become part of the real
estate. Debtor agrees to keep the Collateral at the location set forth above,
and will notify Secured Party promptly in writing of any change in the location
of the Collateral within such State, but will not remove the collateral from
such State without the prior written consent of Secured Party (except that in
the State of Pennsylvania, the Collateral will not be moved from the above
location without such prior written consent).
5. LATE CHARGES AND OTHER FEES.
Any payment not made within ten (10) days of when due shall, at the option of
Secured Party, bear late charges thereon calculated at the rate of 1% per month,
but in no event greater than the highest rate permitted by relevant law. Debtor
shall be responsible for and pay to Secured Party a returned check fee, not to
exceed the maximum permitted by law, which fee will be equal to the sum of (i)
the actual bank charges incurred by Secured Party plus (ii) all other actual
costs and expenses incurred by Secured Party. The returned check fee is payable
upon demand as indebtedness secured by the Collateral under this Security
Agreement.
6. DEBTOR'S WARRANTIES AND REPRESENTATIONS.
Debtor warrants and represents:
(a) that Debtor is justly indebted to Secured Party for the full amount of the
indebtedness set forth on each Schedule;
(b) that except for the security interest granted hereby, the Collateral is free
from and will be kept free from all liens, claims, security interests and
encumbrances;
(c) that no financing statement covering the Collateral or any proceeds thereof
is on file in favor of anyone other than Secured Party, but if such other
financing statement is on file, it will be terminated or subordinated;
(d) that all information supplied and statements made by Debtor in any
financial, credit or accounting statement or application for credit prior to,
contemporaneously with or subsequent to the execution of this Security Agreement
with respect to this transaction are and shall be true, correct, valid and
genuine; and
(e) that Debtor has full authority to enter into this agreement and in so doing
It is not violating its charter or by-laws, any law or regulation or agreement
with third parties, and it has taken all such action as may be necessary or
appropriate to make this Security Agreement binding upon it.
7. DEBTOR'S AGREEMENTS.
Debtor agrees:
<PAGE> 3
(a) to defend at Debtors own cost any action, proceeding, or claim affecting the
Collateral;
(b) to pay reasonable attorneys' fees and other expenses incurred by Secured
Party in enforcing its rights against Debtor under this Security Agreement;
(c) to pay promptly all taxes, assessments, license fees and other public or
private charges when levied or assessed against the Collateral or this Security
Agreement, and this obligation shall survive the termination of this Security
Agreement;
(d) that if a certificate of title be required or permitted by law, Debtor shall
obtain such certificate with respect to the Collateral, showing the security
interest of Secured Party thereon and in any event do everything necessary or
expedient to preserve or perfect the security interest of Secured Party;
(e) that Debtor will not misuse, fail to keep in good repair, secrete or without
the prior written consent of Secured Party, sell, rent, tend, encumber or
transfer any of the Collateral notwithstanding Secured Party's right to
proceeds;
(f) that Secured Party may enter upon Debtor's premises or wherever the
Collateral may be located at any reasonable time to inspect the Collateral and
Debtor's books and records pertaining to the Collateral, and Debtor shall assist
Secured Party in making such inspection; and
(g) that the security interest granted by Debtor to Secured Party shall continue
effective irrespective of any retaking or redelivery of any Collateral and
irrespective of the payment of the amount described in any Schedule so long as
there are any obligations of any kind, including obligations under guaranties or
assignments, owed by Debtor to Secured Party, provided, however, upon any
assignment of this Security Agreement the Assignee shall thereafter be deemed
for the purpose of this Paragraph the Secured Party under this Security
Agreement.
8. INSURANCE AND RISK OF LOSS.
All risk of loss, damage to or destruction of the Collateral shall at all times
be on Debtor. Debtor will procure forthwith and maintain at Debtor's expense
insurance against all risks of loss or physical damage to the Collateral for the
full insurable value thereof for the life of this Security Agreement plus breach
of warranty insurance and such other insurance thereon in amounts and against
such risks as Secured Party may specify, and shall promptly deliver each policy
to Secured Party with a standard long-form mortgagee endorsement attached
thereto showing loss payable to Secured Party; and providing Secured Party with
not less than 30 days written notice of cancellation; each such policy shall be
in form, terms and amount and with insurance carriers satisfactory to Secured
Party; Secured Party's acceptance of policies in lesser amounts or risks shall
not be a waiver of Debtor's foregoing obligations. As to Secured Party's
interest in such policy, no act or omission of Debtor or any of its officers,
agents, employees or representatives shall affect the obligations of the insurer
to pay the full amount of any loss.
Debtor hereby assigns to Secured Party any monies which may become payable under
any such policy of insurance and irrevocably constitutes and appoints Secured
Party as Debtor's attorney in fact (a) to hold each original insurance policy,
(b) to make, settle and adjust claims under each policy of insurance, (c) to
make claims for any monies which may become payable under such and other
insurance on the Collateral including returned or unearned premiums, and (d) to
endorse Debtor's name on any check, draft or other instrument received in
payment of claims or returned or unearned premiums under each policy and to
apply the funds to the payment of the indebtedness owing to Secured Party;
provided, however, Secured Party is under no obligation to do any of the
foregoing.
Should Debtor fail to furnish such insurance policy to Secured Party, or to
maintain such policy in full force, or to pay any Premium in whole or in part
relating thereto, then Secured Party, without waiving or releasing any default
or obligation by Debtor, may (but shall be under no obligation to) obtain and
maintain insurance and pay the premium therefor on behalf of Debtor and charge
the premium to Debtor's indebtedness under this Security Agreement. The full
amount of any such premium paid by Secured Party shall be payable by Debtor upon
demand, and failure to pay same shall constitute an event of default under this
Security Agreement.
<PAGE> 4
9. EVENTS OF DEFAULT; ACCELERATION.
A VERY IMPORTANT ELEMENT OF THIS SECURITY AGREEMENT IS THAT DEBTOR MAKE ALL ITS
PAYMENTS PROMPTLY AS AGREED UPON. IT IS ESSENTIAL THAT THE COLLATERAL REMAIN IN
GOOD CONDITION AND ADEQUATE SECURITY FOR THE INDEBTEDNESS. THE FOLLOWING ARE
EVENTS OF DEFAULT UNDER THIS SECURITY AGREEMENT WHICH WILL ALLOW SECURED PARTY
TO TAKE SUCH ACTION UNDER THIS PARAGRAPH AND UNDER PARAGRAPH 10 AS IT DEEMS
NECESSARY:
(a) any of Debtor's obligations to Secured Party under any agreement with
Secured Party is not paid promptly when due;
(b) Debtor breaches any warranty or provision hereof, or of any note or of any
other instrument or agreement delivered by Debtor to Secured Party in connection
with this or any other transaction;
(c) Debtor dies, becomes insolvent or ceases to do business as a going concern.
(d) it is determined that Debtor has given Secured Party materially misleading
information regarding its financial condition;
(e) any of the Collateral is lost or destroyed unless such loss or destruction
is covered by insurance pursuant to Section 8 hereof;
(f) a complaint in bankruptcy or for arrangement or reorganization or for relief
under any insolvency law is filed by Debtor or a complaint in bankruptcy or for
arrangement or reorganization or for relief under any insolvency law is filed
against Debtor and not dismissed within 75 days thereafter or Debtor admits its
inability to pay its debts as they mature;
(g) property of Debtor is attached or a receiver is appointed for Debtor and
such attachment or appointment is not dismissed or released within 30 days of
Debtor receiving notice of same;
(h) any guarantor, surety or endorser for Debtor dies or defaults in any
obligation or liability to Secured Party or any guaranty obtained in connection
with this transaction is terminated or breached.
IF DEBTOR SHALL BE IN DEFAULT HEREUNDER, THE INDEBTEDNESS DESCRIBED IN EACH
SCHEDULE AND ALL OTHER INDEBTEDNESS THEN OWING BY DEBTOR TO SECURED PARTY UNDER
THIS OR ANY OTHER PRESENT OR FUTURE AGREEMENT (COLLECTIVELY, THE "INDEBTEDNESS")
SHALL, IF SECURED PARTY SHALL SO ELECT, BECOME IMMEDIATELY DUE AND PAYABLE,
AFTER ACCELERATION:
(a) the unpaid principal balance of the indebtedness described in any Schedule
in which interest has been precomputed shall bear Interest at the rate of 12%
per annum (or, if less, the maximum rate permitted by law) until paid in full;
and
In no event shall the Debtor upon demand by Secured Party for payment of the
Indebtedness, by acceleration of the maturity thereof or otherwise, be obligated
to pay any interest in excess of the amount permitted by law. Any acceleration
of the Indebtedness, if elected by Secured Party, shall be subject to all
applicable laws, including laws relating to rebates and refunds of unearned
charges.
10. SECURED PARTY'S REMEDIES AFTER DEFAULT; CONSENT TO ENTER PROMISES.
Upon Debtor's default and at any time thereafter, Secured Party shall have all
the rights and remedies of a secured party under the Uniform Commercial Code and
any other applicable laws, including the right to any deficiency remaining after
disposition of the Collateral for which Debtor hereby agrees to remain fully
liable. Upon Debtor's default and at any time thereafter, Debtor agrees that
Secured Party, by itself or its agent, may either with the consent of Debtor or
with judicial process, enter into any premises or upon any land owned, leased or
otherwise under the real or apparent control of Debtor or any agent of Debtor
where the Collateral may be or where Secured Party believes the Collateral may
be, and disassemble, render unusable and/or repossess all or any item of the
Collateral, disconnecting and separating all Collateral from any other property
and using all force necessary. Debtor
<PAGE> 5
expressly waives all further rights to possession of the Collateral after
default and all claims for injuries suffered through or loss caused by such
entering and/or repossession. Secured Party may require Debtor to assemble the
Collateral and return it to Secured Party at a place to be designated by Secured
Party which is reasonably convenient to both parties.
Secured Party may sell or lease the Collateral at a time and location of its
choosing provided that the Secured Party acts in good faith and in a
commercially reasonable manner. Secured Party will give Debtor reasonable notice
of the time and place of any public sale of the Collateral or of the time after
which any private sale or any other intended disposition of the Collateral is to
be made. Unless otherwise provided by law, the requirement of reasonable notice
shall be met if such notice is mailed postage prepaid, to the address of Debtor
shown herein at least ten days before the time of the sale or disposition.
Expenses of retaking, holding, preparing for sale, selling and the like shall
include reasonable attorneys' and other legal expenses. Debtor understands that
Secured Party's rights are cumulative and not alternative.
11. WAIVER OF DEFAULTS; AGREEMENT INCLUSIVE.
Secured Party may in its sole discretion waive a default, or cure, at Debtor's
expense, a default. Any such waiver in a particular instance or of a particular
default shall not be a waiver of other defaults or the same kind of default at
another time. No modification or change in this Security Agreement or any
related note, instrument or agreement shall bind Secured Party unless in writing
signed by Secured Party. No oral agreement shall be binding.
12. FINANCING STATEMENTS; CERTAIN EXPENSES.
If permitted by law Debtor authorizes Secured Party to file a financing
statement with respect to the Collateral signed only by Secured Party, and to
file a carbon, photograph or other reproduction of this Security Agreement or of
a financing statement provided however, assuming Debtor delivers to Secured
Party properly executed financing statements, Secured Party agrees it will not
file a carbon, photograph or other reproduction of this Security Agreement in
the State of Florida or any county thereof. At the request of Secured Party,
Debtor will execute any financing statements, agreements or documents, in form
satisfaction to Secured Party which Secured Party may deem necessary or
advisable to establish and maintain a perfected security interest in the
Collateral and will pay the cost of filing or recording the same in all public
offices deemed necessary or advisable by Secured Party. Debtor also agrees to
pay all costs and expenses incurred by Secured Party in conducting UCC, tax or
other lien searches against the Debtor or the Collateral and such other fees as
may be agreed.
13. WAIVER OF DEFENSES ACKNOWLEDGMENT
If Secured Party assigns this Security Agreement to a third party ("Assignee"),
then after such assignment:
(a) Debtor will make all payments directly to such Assignee at such place as
Assignee may from time to time designate in writing;
(b) Debtor agrees that it will settle all claims, defenses, setoffs and
counterclaims it may have against Secured Party directly with Secured Party and
will not set up any such claim, defense, setoff or counterclaim against
Assignee, Secured Party hereby agreeing to remain responsible therefor;
(c) Secured Party shall not be Assignee's agent for any purpose and shall have
no authority to change or modify this Security Agreement or any related document
or instrument; and
(d)Assignee shall have all of the rights and remedies of Secured Party hereunder
but none of Secured Party's obligations.
14. MISCELLANEOUS.
Debtor waives all exemptions. Secured Party may correct patent errors herein and
fill in such blanks as serial numbers, date of first payment and the like. Any
provisions hereof contrary to, prohibited by or invalid under
<PAGE> 6
applicable laws or regulations shall be inapplicable and deemed omitted
herefrom, but shall not invalidate the remaining provisions hereof.
Debtor and Secured Party each hereby waive any right to a trial by jury in any
action or proceeding with respect to, in connection with, or arising out of this
Security Agreement or any note or document delivered pursuant to this Security
Agreement. Except as otherwise provided herein or by applicable law, the Debtor
shall have no right to prepay the indebtedness described in any Schedule. DEBTOR
ACKNOWLEDGES RECEIPT OF A TRUE COPY AND WAIVES ACCEPTANCE HEREOF.
If Debtor is a corporation, this Security Agreement is executed pursuant to
authority of its Board of Directors. Except where the context otherwise
requires, "Debtor" and "Secured Party include the heirs, executors or
administrators, successors or assigns of those parties; nothing herein shall
authorize Debtor to assign this Security Agreement or its rights in and to the
Collateral. If more than one Debtor executes this Security Agreement, their
obligations under this Security Agreement shall be joint and several.
If at any time this transaction would be usurious under applicable law, then
regardless of any provision contained in this Security Agreement or in any other
agreement made in connection with this transaction, it is agreed that:
(a) the total of all consideration which constitutes interest under applicable
law that is contracted for, charged or received upon this Security Agreement or
any such other agreement shall under no circumstances exceed the maximum rate of
interest authorized by applicable law and any excess shall be credited to the
Debtor; and
(b) If Secured Party elects to accelerate the maturity of, or if Secured Party
permits Debtor to prepay the indebtedness described in Paragraph 3, any amounts
which because of such action would constitute interest may never include more
than the maximum rate of interest authorized by applicable law and any excess
interest, if any, provided for in this Security Agreement or otherwise, shall be
credited to Debtor automatically as of the date of acceleration or prepayment.
15. SPECIAL PROVISIONS.
SEE SPECIAL PROVISION INSTRUCTIONS.
See Riders A, B, C and D attached hereto and made a part /s/ GAS (Debtor,
please initial) -----------
DATED: SEPTEMBER 24, 1998
------------------
DEBTORS:
COOKER RESTAURANT CORPORATION, AN OHIO CORPORATION
- ----------------------------------------------------
Name of individual, corporation or partnership
By /s/ G. Arthur Seelbinder Title Chairman
-------------------------------- ------------------
If corporation, have signed by President, Vice President or Treasurer, and
give official title. If owner or partner, state which.
5500 Village Blvd.
--------------------------------------------------------------------------
Address
West Palm Beach FL 33407
--------------------------------------------------------------------------
City State Zip Code
CGR MANAGEMENT CORPORATION, A FLORIDA CORPORATION
- -----------------------------------------------------
Name of individual, corporation or partnership
By /s/ G. Arthur Seelbinder Title Chairman
-------------------------------- ------------------
If corporation, have signed by President, Vice President or Treasurer, and
give official title. If owner or partner, state which.
<PAGE> 7
5500 Village Blvd.
--------------------------------------------------------------------------
Address
West Palm Beach FL 33407
--------------------------------------------------------------------------
City State Zip Code
SECURED PARTY:
THE CIT GROUP/EQUIPMENT FINANCING, INC.
- ---------------------------------------------------
Name of individual, corporation or partnership
By /s/ Joseph P. Cunningham Title Assistant Vice President
-------------------------------- --------------------------
If corporation, give official title. If owner or partner, state which.
900 Ashwood Parkway
--------------------------------------------------------------------------
Address
Atlanta GA 30338
--------------------------------------------------------------------------
City State Zip Code
<PAGE> 8
SCHEDULE No. 01.
Schedule of Indebtedness and Collateral
To Master Security Agreement dated September 24, 1998 between the undersigned
Secured Party and Debtor.
This Schedule of Indebtedness and Collateral incorporates the terms and
conditions of the above-referenced Master Security Agreement.
This is Originally Executed Copy No. 1 of 1 originally executed copies. Only
transfer of possession by Secured Party of Originally Executed Copy No. 1 shall
be effective for purposes of perfecting an interest in this Schedule by
possession.
The equipment listed on this Schedule will be located at:
See Exhibit A attached hereto
- ----------------------------------------------------------------------
Address City County State Zip Code
Debtor grants to Secured Party a security interest in the property described
below, along with all present and future attachments and accessories thereto and
replacements and proceeds thereof, including amounts payable under any insurance
policy, all hereinafter referred to collectively as "Collateral".
Collateral Description (Describe Collateral fully including make, kind of unit,
model and serial numbers and any other pertinent information.)
All present and hereafter acquired machinery, equipment, furnishings and
fixtures, and all additions, substitutions and replacements thereof, together
with all attachments, additions, components, parts, equipment and accessories
installed thereon or affixed thereto, and all proceeds of whatever sort, at the
locations more specifically set forth on Exhibit A attached hereto and made a
part hereof.
THE REMAINDER OF THIS PACE IS INTENTIONALLY LEFT BLANK
<PAGE> 9
Debtor promises to pay Secured Party the total sum of $22,063,981.40 which
represents principal and interest precomputed over the term hereof, payable in
59 COMBINED PRINCIPAL AND INTEREST PAYMENTS OF $267,638.57 each commencing on
_______________, 1998 and a 60TH COMBINED PRINCIPAL AND INTEREST PAYMENT OF
$6,273,305.77 on _______________, 2003. Payment shall be made at the address of
Secured Party shown on the Master Security Agreement or such other place as
Secured Party may designate from time to time.
ACCEPTED
----------------------
SECURED PARTY:
THE CIT GROUP/EQUIPMENT FINANCING, INC.
BY /s/ Joseph P. Cunningham Title Assistant Vice President
-------------------------------- --------------------------
EXECUTED ON SEPTEMBER 24, 1998
DEBTOR:
COOKER RESTAURANT CORPORATION
- -----------------------------------------------------------------------------
Name of individual, corporation or partnership
BY /s/ G. Arthur Seelbinder Title Chairman
-------------------------------- --------------------------
EXECUTED ON SEPTEMBER 24, 1998
DEBTOR:
CGR MANAGEMENT CORPORATION
- -----------------------------------------------------------------------------
Name of individual, corporation or partnership
BY /s/ G. Arthur Seelbinder Title Chairman
-------------------------------- --------------------------
EXECUTED ON SEPTEMBER 24, 1998
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> JAN-03-1999
<PERIOD-START> JUN-29-1998
<PERIOD-END> SEP-27-1998
<CASH> 1,697,000
<SECURITIES> 0
<RECEIVABLES> 626,000
<ALLOWANCES> 0
<INVENTORY> 1,532,000
<CURRENT-ASSETS> 4,188,000
<PP&E> 168,006,000
<DEPRECIATION> 26,235,000
<TOTAL-ASSETS> 147,867,000
<CURRENT-LIABILITIES> 16,857,000
<BONDS> 37,788,000
0
0
<COMMON> 62,482,000
<OTHER-SE> 29,507,000
<TOTAL-LIABILITY-AND-EQUITY> 147,867,000
<SALES> 38,018,000
<TOTAL-REVENUES> 40,434,000
<CGS> 33,411,000
<TOTAL-COSTS> 33,411,000
<OTHER-EXPENSES> 2,652,000
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 747,000
<INCOME-PRETAX> 1,208,000
<INCOME-TAX> 411,000
<INCOME-CONTINUING> 797,000
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 797,000
<EPS-PRIMARY> 0.08
<EPS-DILUTED> 0.08
</TABLE>
