Attached files
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| 8-K - PEETS COFFEE & TEA INC | v206352_8k.htm |
Exhibit
10.1
Amended
and Restated
Credit
Agreement
This
Amended
and Restated
Credit
Agreement
(this “Agreement”) is
entered into as of December 21, 2010, by and between Peet’s
Coffee
& Tea,
Inc.,
a Washington corporation (“Borrower”), and Wells Fargo
Bank,
National
Association
(“Bank”).
Recitals
Whereas,
Borrower and Bank are party to that certain Credit Agreement, dated as of
November 26, 2008 (as amended, restated, modified and/or supplemented prior
to the date hereof, the “Existing
Agreement”).
Whereas,
Borrower has requested that Bank (i) amend and restate the Existing
Agreement and (ii) extend or continue credit to Borrower as described
below, and Bank has agreed to provide such credit to Borrower on the terms and
conditions contained herein.
Now,
Therefore,
for valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, Bank and Borrower hereby agree as follows:
Article
I
Credit
Terms
Section
1.1. Line
of Credit.
(a)
Line of
Credit. Subject to the terms and conditions of this Agreement,
Bank hereby agrees to make advances to Borrower from time to time up to and
including December 1, 2013, not to exceed at any time the aggregate
principal amount of Fifty Million Dollars ($50,000,000) (the “Line of
Credit”). The proceeds of the initial advance under the Line
of Credit shall be used to refinance all outstanding indebtedness owing under
the Existing Agreement and the proceeds of all other advances under the Line of
Credit shall be used to finance general corporate purposes, including Borrower’s
repurchase of stock and to fund working capital, capital expenditures and other
needs. Borrower’s obligation to repay advances under the Line of
Credit shall be evidenced by a promissory note dated as of December 21,
2010 (the “Line of Credit
Note”), all terms of which are incorporated herein by this
reference.
(b)
Borrowing and
Repayment. Borrower may from time to time during the term of
the Line of Credit borrow, partially or wholly repay its outstanding borrowings,
and reborrow, subject to all of the limitations, terms and conditions contained
herein or in the Line of Credit Note; provided however, that the total
outstanding borrowings under the Line of Credit shall not at any time exceed the
maximum principal amount available thereunder, as set forth
above.
1
Section
1.2. Interest/Fees.
(a)
Interest/Applicable
Rate. The outstanding principal balance of the Line of Credit
shall bear interest at the rate of interest set forth in the Line of Credit
Note.
As used
in this Agreement, the following terms shall have the meaning set forth
below:
“Adjusted Annual Rental
Expense” means, as of any date of determination, Annual Rental Expense
for the four fiscal quarter period ending on such date of determination
multiplied by six (6).
“Annual EBITDA” means, as of
any date of determination, income before income taxes of Borrower and Borrower’s
consolidated subsidiaries on a consolidated basis for the four fiscal quarter
period ending on such date of determination, plus (without duplication)
interest expense (net of capitalized interest expense) to the extent included in
the determination of such income before income taxes, plus (without duplication)
depreciation expense to the extent included in the determination of such income
before income taxes, plus (without duplication)
amortization expense to the extent included in the determination of such income
before income taxes, plus (without duplication)
non-cash stock compensation expense to the extent included in the determination
of such income before income taxes.
“Annual Rental Expense”
means, as of any date of determination, all rental expense of Borrower and
Borrower’s consolidated subsidiaries on a consolidated basis incurred during the
four fiscal quarter period ending on such date of determination under any rental
agreements or leases, other than obligations in respect of any capitalized
leases.
“Applicable Rate” means, from
time to time, with respect to any advance under the Line of Credit for which
interest is determined based on Daily One-Month LIBOR (as defined in the Line of
Credit Note) or LIBOR (as defined in the Line of Credit Note) for a fixed term,
or with respect to the Unused Commitment Fees payable pursuant to
Section 1.2(c) hereof, as the case may be, the applicable rate per annum
set forth below (expressed in basis points) under the caption “Daily One-Month
LIBOR Spread” (which is the Applicable Rate applicable to advances under the
Line of Credit for which interest is determined based on Daily One-Month LIBOR),
“Fixed LIBOR Spread” (which is the Applicable Rate applicable to advances under
the Line of Credit for which interest is determined based on LIBOR for a fixed
term) or “Unused Commitment Fee Rate” (which is the Applicable Rate applicable
to the unused portion of the Line of Credit), as the case may be, based upon,
subject to Section 1.2(b), the Leverage Ratio as set forth in the most
recent Compliance Certificate received by Bank pursuant to
Section 4.3(c):
2
|
Tier
|
Leverage
Ratio
|
Daily One-
Month
LIBOR
Spread
|
Fixed
LIBOR
Spread
|
Unused
Commitment
Fee Rate
|
|||||||||
|
1
|
Greater
than 2.00 to 1.00
|
150.00 | 150.00 | 25.00 | |||||||||
|
2
|
Less
than or equal to
2.00
to 1.00
|
100.00 | 100.00 | 12.50 | |||||||||
“Default” means any Event of
Default or any event or condition that, with the giving of notice, the passage
of time, or both, would constitute an Event of Default.
“GAAP” means generally
accepted accounting principles in the United States, consistently
applied.
“Leverage Ratio” means, as of
any date of determination, (A) the sum of Total Funded Debt as of such date
plus Adjusted Annual
Rental Expense as of such date divided by (B) the sum of Annual EBITDA as
of such date plus
Annual Rental Expense as of such date.
“Material Adverse Effect”
means any of the following: (a) a material adverse change in or
a material adverse effect upon (in either case, irrespective of whether
occurring as a result of a specific event or circumstance or otherwise) the
business, condition (financial or otherwise), operations or properties of
Borrower and POCI taken as a whole; (b) a material impairment (irrespective
of whether occurring as a result of a specific event or circumstance or
otherwise) of the rights and remedies of Bank under the Loan Documents; or
(c) a material adverse effect (irrespective of whether occurring as a
result of a specific event or circumstance or otherwise) upon the legality,
validity, binding effect or enforceability against either Borrower or POCI of
any Loan Document to which it is a party.
“POCI” means Peet’s Operating
Company, Inc.
“Total Funded Debt” means, as
of any date of determination and with respect to Borrower and Borrower’s
consolidated subsidiaries on a consolidated basis, the sum of (without
duplication): (a) the outstanding principal amount of all
obligations of such person or persons, whether current or long-term, for
borrowed money and all obligations of such person or persons evidenced by bonds,
debentures, notes, loan agreements or other similar instruments; plus (b) all purchase
money debt of such person or persons; plus (c) all direct
obligations of such person or persons arising under letters of credit (whether
standby or commercial), bankers’ acceptances, bank guaranties, surety bonds and
similar instruments; plus (d) all obligations
of such person or persons in respect of the deferred purchase price of property
or services (other than trade accounts payable in the ordinary course of
business); plus
(e) the capitalized amount of any capital leases of such person or persons
that would appear on such person or persons balance sheet prepared as of such
date in accordance with GAAP; plus (f) the amount of
all guarantees made by such person or persons with respect to outstanding debt
of the types specified in clauses (a) through (e) of this definition of persons
other than the person or persons for which Total Funded Debt is being
determined.
3
(b)
Computation and
Payment. Interest shall be computed on the basis of a 360-day
year, actual days elapsed. Interest shall be payable at the times and
place set forth in each promissory note or other instrument or document required
hereby. Any increase or decrease in any Applicable Rate resulting
from a change in the Leverage Ratio shall become effective as of the first day
of the month immediately following the month in which Borrower is required to
deliver a Compliance Certificate in accordance with Section 4.3(c) for a
given period (each such date, a “calculation date”); provided that the
Applicable Rate in effect from the date of this Agreement to the first day of
the month immediately following receipt by Bank of a timely delivered Compliance
Certificate with respect to the fiscal quarter ending December 31, 2010
shall be determined based upon Tier 2 (as indicated in the definition of
“Applicable Rate”);
provided further that,
if any Compliance Certificate required to be delivered in accordance with
Section 4.3(c) for any given period is not delivered to Bank on or before
the related calculation date, then Tier 1 (as indicated in the definition
of “Applicable Rate”)
shall apply, effective on the related calculation date until two business days
after such Compliance Certificate is actually received by
Bank. Notwithstanding the foregoing and for the avoidance of doubt,
if for any period and for any reason, the actual Leverage Ratio is higher than
that reported in the Compliance Certificate, Borrower shall immediately, without
the requirement of notice or demand from any person, pay to Bank an amount equal
to the excess of: (A) the amount of interest or fees that would
have accrued had the Applicable Rates for the relevant period been based upon
the actual Leverage Ratio for the prior period rather than the Leverage Ratio
reported in the Compliance Certificate delivered for such prior period; over (B) the amount of
interest or fees that was actually paid by Borrower based upon the Leverage
Ratio reported in the Compliance Certificate delivered for such
period.
(c)
Unused Commitment
Fee. Borrower shall pay to Bank unused commitment fees (each,
an “Unused Commitment
Fee”) equal to the Applicable Rate multiplied by the average daily unused
amount of the Line of Credit (computed on the basis of a 360-day year, actual
days elapsed). Unused Commitment Fees shall accrue at all times prior
to the maturity date of the Line of Credit, and shall be due and payable monthly
in arrears ten (10) days after last day of each month, commencing with the first
such date to occur after the date of this agreement, and on the maturity date of
the Line of Credit. Unused Commitment Fees shall be calculated
monthly in arrears, and if there is any change in the Applicable Rate during any
month, the actual daily unused amount shall be computed and multiplied by the Applicable
Rate separately for each period during such month that such Applicable Rate was
in effect.
Section
1.3. Collection
of Payments. Borrower
authorizes Bank to collect all principal, interest and fees due under each
credit subject hereto by charging POCI’s deposit account number 4950-014654 with
Bank, or any other deposit account maintained by Borrower or POCI with Bank, for
the full amount thereof. Should there be insufficient funds in any
such deposit account to pay all such sums when due, the full amount of such
deficiency shall be immediately due and payable by Borrower.
4
Section
1.4. Guaranty. The
payment and performance of all indebtedness and other obligations of Borrower to
Bank shall be guaranteed by POCI in the principal amount of Fifty Million
Dollars ($50,000,000), as evidenced by and subject to the terms of a guaranty in
form and substance satisfactory to Bank.
Article
II
Representations
and Warranties
Borrower
makes the following representations and warranties to Bank, which
representations and warranties shall survive the execution of this Agreement and
shall continue in full force and effect until the full and final payment, and
satisfaction and discharge, of all obligations of Borrower to Bank subject to
this Agreement.
Section
2.1. Legal
Status. Borrower
is a corporation, duly organized and existing and in good standing under the
laws of Washington, and POCI is a corporation, duly organized and existing and
in good standing under the laws of Virginia. Borrower and each of its
subsidiaries is qualified or licensed to do business (and is in good standing as
a foreign corporation, if applicable) in all jurisdictions in which the failure
to so qualify or to be so licensed could have a material adverse effect on
Borrower or such subsidiary.
Section
2.2. Authorization
and Validity. This
Agreement and each promissory note, contract, instrument and other document
required hereby or at any time hereafter delivered to Bank in connection
herewith (collectively, the “Loan Documents”) have been
duly authorized, and upon their execution and delivery in accordance with the
provisions hereof will constitute legal, valid and binding agreements and
obligations of Borrower or the party which executes the same, enforceable in
accordance with their respective terms, subject to the effect of bankruptcy,
insolvency, reorganization, moratorium or similar laws affecting the
enforceability of creditor’s rights generally and to general principles of
equity.
Section
2.3. No
Violation. The
execution, delivery and performance by Borrower and POCI of each of the Loan
Documents to which it is a party do not violate any material provision of any
law or regulation, or contravene any provision of the Articles of Incorporation
or By-Laws of Borrower or POCI, or result in any breach of or default under any
material contract, obligation, indenture or other material instrument to which
Borrower or POCI is a party or by which Borrower or POCI may be
bound.
Section
2.4. Litigation. There
are no pending, or to the best of Borrower’s knowledge threatened, actions,
claims, investigations, suits or proceedings by or before any governmental
authority, arbitrator, court or administrative agency which would reasonably be
expected to have a material adverse effect on the financial condition or
operation of Borrower or POCI other than those disclosed by Borrower to Bank in
writing (including as disclosed pursuant to Borrower’s Forms 8-K, 10-K and 10-Q
filed with the United States Securities and Exchange Commission) prior to the
date hereof.
5
Section
2.5. Correctness
of Financial
Statement. The
consolidated annual financial statement of Borrower dated January 3, 2010,
and all interim financial statements delivered to Bank since said date, true
copies of which have been delivered by Borrower to Bank prior to the date
hereof, (a) are complete and correct and present fairly the financial condition
of Borrower and POCI, (b) disclose all liabilities of Borrower and POCI that are
required to be reflected or reserved against under GAAP, whether liquidated or
unliquidated, fixed or contingent, and (c) have been prepared in accordance with
GAAP. Since the dates of such financial statements there has been no
material adverse change in the financial condition of Borrower or POCI, nor has
Borrower or POCI mortgaged, pledged, granted a security interest in or otherwise
encumbered any of its assets or properties except for Permitted Liens or in
favor of Bank or as otherwise permitted by Bank in writing.
Section
2.6. Income
Tax
Returns. Borrower
has no knowledge of any pending assessments or adjustments of its income tax
payable with respect to any year.
Section
2.7. No
Subordination. There
is no agreement, indenture, contract or instrument to which Borrower is a party
or by which Borrower may be bound that requires the subordination in right of
payment of any of Borrower’s obligations subject to this Agreement to any other
obligation of Borrower.
Section
2.8. Permits,
Franchises. Each
of Borrower and POCI possesses, and Borrower will and will cause
POCI to hereafter possess, all permits, consents, approvals,
franchises and licenses required and rights to all trademarks, trade names,
patents, and fictitious names, if any, necessary to enable it to conduct the
business in which it is now engaged in compliance with applicable law, except to
the extent the failure to so possess would not reasonably be expected to have a
material adverse effect on Borrower or any of its subsidiaries.
Section
2.9. Erisa. Borrower
and its subsidiaries each (i) is in compliance in all material respects with all
applicable provisions of the Employee Retirement Income Security Act of 1974, as
amended or recodified from time to time (“ERISA”); (ii) has not
violated any provision of any defined employee pension benefit plan (as defined
in ERISA) maintained or contributed to by it (each, a “Plan”); (iii) has had no
Reportable Event as defined in ERISA occur and be continuing with respect to any
Plan initiated by it; (iv) has met its minimum funding requirements under ERISA
with respect to each Plan; and (v) represent and warrant that each Plan will be
able to fulfill its benefit obligations as they come due in accordance with the
applicable Plan documents and under GAAP.
Section
2.10. Other
Obligations. No
Default exists or would result from the incurring of any of the obligations of
Borrower subject hereto. As of the date of this Agreement, none of
Borrower, POCI or any consolidated subsidiary of Borrower or POCI is in default
under or with respect to any obligation for borrowed money, any purchase money
obligation or any other material lease, commitment, contract, instrument or
obligation in any respect that, individually or together with all such defaults,
could reasonably be expected to have a Material Adverse Effect, or that would,
if such default had occurred after the date of this Agreement, create an Event
of Default under Section 6.1(d) hereof.
6
Section
2.11. Environmental
Matters. Except
as disclosed by Borrower to Bank in writing prior to the date hereof, Borrower
and its subsidiaries each are in compliance in all material respects with all
applicable federal or state environmental, hazardous waste, health and safety
statutes, and any rules or regulations adopted pursuant thereto, which govern or
affect any of Borrower’s operations and/or properties, including without
limitation, the Comprehensive Environmental Response, Compensation and Liability
Act of 1980, the Superfund Amendments and Reauthorization Act of 1986, the
Federal Resource Conservation and Recovery Act of 1976, and the Federal
Toxic Substances Control Act, as any of the same may be amended, modified or
supplemented from time to time. None of the operations of Borrower or
any of its subsidiaries is the subject of any federal or state investigation
evaluating whether any remedial action involving a material expenditure is
needed to respond to a release of any toxic or hazardous waste or substance into
the environment. Neither Borrower nor any subsidiary has any material
contingent liability in connection with any release of any toxic or hazardous
waste or substance into the environment.
Article
III
Conditions
Section
3.1. Conditions
of Initial
Extension
of Credit. The
obligation of Bank to extend the initial credit extension contemplated by this
Agreement is subject to the fulfillment to Bank’s satisfaction of all of the
following conditions:
(a) Approval of Bank
Counsel. All legal matters incidental to the extension of
credit by Bank shall be satisfactory to Bank’s counsel.
(b)
Documentation. Bank
shall have received, in form and substance satisfactory to Bank, each of the
following, duly executed:
|
(i)
|
This
Agreement.
|
|
(ii)
|
The
Line of Credit Note.
|
|
(iii)
|
Certificate
of Incumbency.
|
|
(iv)
|
Corporate
Resolution: Borrowing.
|
|
(v)
|
Corporate
Resolution: Continuing Guaranty.
|
|
(vi)
|
Corporate
Account Holder Resolution.
|
|
(vii)
|
Disbursement
Order.
|
|
(viii)
|
Automatic
Transfer Authorization.
|
|
(ix)
|
Amended
and Restated Continuing Guaranty.
|
|
(x)
|
Such
other documents as Bank may require under any other Section of this
Agreement.
|
(c)
Financial
Condition. There shall have been no material adverse change,
as determined by Bank, in the financial condition or business of Borrower and
its consolidated subsidiaries, taken as a whole.
(d)
Insurance. Borrower
shall have delivered to Bank evidence of insurance coverage on all Borrower’s
and POCI’S property, in form, substance, amounts, covering risks and issued by
companies satisfactory to Bank, and where required by Bank, with loss payable
endorsements in favor of Bank.
7
Section
3.2. Conditions
of Each
Extension
of Credit. The
obligation of Bank to make each extension of credit requested by Borrower
hereunder shall be subject to the fulfillment to Bank’s satisfaction of each of
the following conditions:
(a)
Compliance. The
representations and warranties contained herein and in each of the other Loan
Documents shall be true in all material respects on and as of the date of the
signing of this Agreement and on the date of each extension of credit by Bank
pursuant hereto, with the same effect as though such representations and
warranties had been made on and as of each such date, and on each such date, no
Default or Event of Default shall have occurred and be continuing or shall
exist.
(b)
Documentation. Bank
shall have received all additional documents which may be required in connection
with such extension of credit.
Article
IV
Affirmative
Covenants
Borrower
covenants that so long as Bank remains committed to extend credit to Borrower
pursuant hereto, or any liabilities (whether direct or contingent, liquidated or
unliquidated, but excluding inchoate indemnification obligations) of Borrower to
Bank under any of the Loan Documents remain outstanding, and until payment in
full of all obligations of Borrower subject hereto, Borrower shall, unless Bank
otherwise consents in writing:
Section
4.1. Punctual
Payments. Punctually
pay all principal, interest, fees or other liabilities due under any of the Loan
Documents at the times and place and in the manner specified
therein.
Section
4.2. Accounting
Records. Maintain,
and cause POCI to maintain, adequate books and records in accordance with GAAP,
and permit any representative of Bank, at any reasonable time and upon
reasonable advance notice, to inspect, audit and examine such books and records,
to make copies of the same, and to inspect the properties of Borrower and
POCI.
Section
4.3. Financial
Statements;
Reports. Provide
to Bank all of the following, in form and detail satisfactory to
Bank:
(a)
not later than 90 days after and as of the end of each fiscal year, consolidated
financial statements of Borrower, audited and accompanied by a report and
opinion of Deloitte & Touche LLP or another independent certified public
accountant reasonably acceptable to Bank, which financial statements are to
include balance sheet, income statement, statement of cash flow and all
supporting schedules and footnotes;
(b)
not later than 45 days after and as of the end of each fiscal quarter (other
than the last fiscal quarter of any fiscal year), consolidated financial
statements of Borrower, which financial statements are to include balance sheet,
income statement and statement of cash flow;
8
(c)
contemporaneously with the delivery of any annual and quarterly financial
statements of Borrower required hereby, a certificate (each, a “Compliance Certificate”) of
the chief financial officer of Borrower that said financial statements fairly
present the consolidated financial position and results of operations of
Borrower as of and for the periods presented, subject in the case of quarterly
financial statements, to normal year-end adjustments and the absence of
footnotes, and that to the best knowledge of such officer, there exists no
Default or Event of Default, and including covenant calculation information on a
schedule in the form attached as Exhibit A
hereto;
(d)
promptly, or if applicable, within the time frame required for delivery of items
required above that may be included therein, copies of all proxy statements,
financial statements, reports, and notices sent or made available generally by
Borrower to its security holders or to any holders of its debt and all
registration statements, regular, periodic and special reports filed with the
Securities and Exchange Commission or any governmental authority that may be
substituted therefor, or with any national securities exchange; provided that any
such proxy statements, financial statements (including any financial statements
deliverable pursuant to Sections 4.3(a) and (b) hereof), reports and
notices shall be deemed to have been provided to Bank to the extent publicly
available on the website of the United States Securities and Exchange
Commission; and
(e) from
time to time such other information as Bank may reasonably request.
Section
4.4. Compliance. Preserve
and maintain and cause POCI to preserve and maintain, all licenses, permits,
governmental approvals, rights, privileges and franchises necessary for the
conduct of its business (other than such approvals, rights, privileges and/or
franchises, the failure to preserve or maintain would not reasonably be expected
to result in a material adverse effect on Borrower or any of its subsidiaries);
and comply with the provisions of all documents pursuant to which it is
organized and/or which govern its continued existence and with the requirements
of all laws, rules, regulations and orders of any governmental authority
applicable to it and/or its business, except where non-compliance would not
reasonably be expected to result in a material adverse effect on Borrower or any
of its subsidiaries.
Section
4.5. Insurance. Maintain
and keep in force, and cause POCI to maintain and keep in force, for each
business in which it is engaged, insurance of the types and in amounts
customarily carried in similar lines of business, including but not limited to
fire, extended coverage, public liability, flood, property damage and workers’
compensation, with all such insurance carried with companies and in amounts
reasonably satisfactory to Bank, and deliver to Bank from time to time at Bank’s
request schedules setting forth all insurance then in effect.
Section
4.6. Facilities. Keep
all properties useful or necessary to Borrower’s and POCI ‘s businesses in good
repair and condition, subject to normal wear and tear, and from time to time
make necessary repairs, renewals and replacements thereto, except where the
failure to do so would not reasonably be expected to have a material adverse
effect on Borrower or any of its subsidiaries.
9
Section
4.7. Taxes and Other Liabilities. Pay and
discharge when due (subject to applicable grace periods) any and all
indebtedness, obligations, assessments and taxes, both real or personal,
including without limitation federal and state income taxes and state and local
property taxes and assessments applicable to Borrower and its subsidiaries,
except (a) such as Borrower may in good faith contest or as to which a bona fide
dispute may arise, and (b) for which Borrower has set aside adequate reserves in
accordance with GAAP.
Section
4.8. Litigation. Promptly give notice
in writing to Bank of any litigation pending or threatened against Borrower or
POCI involving any claims in excess of $1,000,000.
Section
4.9. Financial Condition. Maintain
Borrower’s financial condition as follows on a consolidated basis using GAAP
consistently applied (except to the extent modified by the definitions
herein):
(a) Leverage
Ratio not greater than 2.50 to 1.0 at each fiscal quarter end.
(b) Net
income after tax provision not less than $1.00 on a quarterly basis, determined
as of each fiscal quarter end.
Section
4.10. Notice to Bank. Promptly (but in no event more
than five (5) days after the occurrence of each such event or matter) give
written notice to Bank in reasonable detail of: (a) the
occurrence of any Default or Event of Default; (b) any change in the name
or the organizational structure of Borrower or POCI; (c) the occurrence and
nature of any Reportable Event or Prohibited Transaction, each as defined in
ERISA, or any funding deficiency with respect to any Plan; or (d) any
termination or cancellation of any insurance policy which Borrower or POCI is
required to maintain, or any uninsured or partially uninsured loss through
liability or property damage, or through fire, theft or any other cause
affecting Borrower’s or POCI’s property.
Article
V
Negative
Covenants
Borrower
further covenants that so long as Bank remains committed to extend credit to
Borrower pursuant hereto, or any liabilities (whether direct or contingent,
liquidated or unliquidated, but excluding inchoate indemnification obligations)
of Borrower to Bank under any of the Loan Documents remain outstanding, and
until payment in full of all obligations of Borrower subject hereto, Borrower
will not without Bank’s prior written consent:
Section
5.1. Use of Funds. Use or permit the
use of any of the proceeds of any credit extended hereunder except for the
purposes stated in Article I hereof.
Section
5.2.
Other Indebtedness. Create, incur, assume or permit to exist
or permit POCI to create, incur, assume or permit, any indebtedness or
liabilities resulting from borrowings, loans or advances, whether secured or
unsecured, matured or unmatured, liquidated or unliquidated, joint or several,
except (a) liabilities to Bank, (b) any other liabilities of Borrower and POCI
existing as of, and disclosed to Bank prior to, the date hereof, (c) new
purchase money debt, (d) operating leases that are not categorized, or
would not be categorized, as capital leases under GAAP as in effect on the date
of this Agreement, and (e) other unsecured indebtedness of Borrower not existing
on the date hereof, provided that the aggregate principal amount of all such
indebtedness does not exceed $500,000.
10
Section
5.3. Merger, Consolidation, Transfer of
Assets. Merge into or consolidate or permit POCI to merge or
consolidate with any other entity; make any substantial change in the nature of
Borrower’s or POCI’s business as conducted as of the date hereof; acquire all or
substantially all of the assets of any other entity or permit POCI to do the
same; or sell, lease, transfer or otherwise dispose of all or a substantial or
material portion of Borrower’s assets except in the ordinary course of its
business or permit POCI to do the same in respect of its assets; provided,
however, that Borrower and/or POCI shall be permitted to engage in any
non-hostile mergers or acquisitions so long as (a) Borrower or POCI, as the case
may be, remains the surviving entity in the event of any merger, (b) no Default
or Event of Default exists at the time of such transaction or would result from
the consummation of any such transaction, immediately after giving effect
thereto, on a pro-forma basis, and (c) any such merger or acquisition involves a
line of business substantially the same as, or related to, that which is
presently engaged in by Borrower and POCI.
Section
5.4. Guaranties. Guarantee or become
liable in any way as surety, endorser (other than as endorser of negotiable
instruments for deposit or collection in the ordinary course of business),
accommodation endorser or otherwise for, nor pledge or hypothecate any assets as
security for, any liabilities or obligations of any person or entity (other than
Borrower or POCI), except any of the foregoing in favor of Bank, or allow POCI
to do any of the foregoing, except that Borrower and POCI may guarantee or
become liable for indebtedness otherwise permitted under Section 5.2 and
Borrower and POCI may incur Permitted Liens (as defined below).
Section
5.5. Loans, Advances,
Investments. Make any loans or advances to or investments
(collectively, “investments”) in any person
or entity, or allow POCI to do any of the foregoing, except (a) any of the
foregoing existing as of, and disclosed to Bank prior to, the date hereof,
(b) investments acquired as a result of an acquisition or merger permitted
by Section 5.3, (c) investments in cash, cash equivalents, and
investments approved by Borrower’s board of directors or otherwise pursuant to
an investment policy approved by Borrower’s board of directors, (d) guaranties
and other contingent obligations permitted by Section 5.4,
(e) investments by Borrower in POCI, (f) investments consisting of
extensions of credit to Borrower’s or any subsidiary’s customers that arise in
the ordinary course of Borrower’s or such subsidiary’s business and are in the
nature of accounts receivables, prepaid royalties or notes receivables arising
from the sale or lease of goods, provision of services or licensing activities
of Borrower, (g) investments, not to exceed $100,000 in the aggregate
outstanding at any time, received in satisfaction or partial satisfaction of
obligations owed by financially troubled obligors and investments acquired in
connection with or as a result of a bankruptcy, workout, reorganization or
recapitalization of an obligor or customer, (h) investments consisting of
commodity forward purchase contracts, (i) investments consisting of loans and
advances to employees in an aggregate amount not to exceed $250,000 at any one
time outstanding, (j) investments constituting accounts receivables, trade
debt or deposits made in the ordinary course of business, and (k) joint
ventures, provided (a) no Default or Event of Default exists at the time of such
transaction or would result from the consummation of any such transaction,
immediately after giving effect thereto, on a pro-forma basis, and (b) any
such joint venture involves a line of business substantially the same as, or
related to, that which is presently engaged in by Borrower and
POCI.
11
Section
5.6. Pledge of Assets. Mortgage,
pledge, grant or permit to exist a security interest in, or lien upon
(collectively, “liens”), all or any portion
of Borrower’s assets now owned or hereafter acquired, or permit POCI to do the
same in respect of its assets, except the following liens (collectively, “Permitted Liens”):
(a) liens in favor of Bank, (b) liens existing as of, and disclosed to
Bank in writing prior to, the date hereof, (c) liens to the extent they
secure purchase money debt permitted under Section 5.2 hereof provided that such
liens do not extend beyond the assets (including accessions, additions, parts,
replacements, fixtures, improvements and attachments thereto, and the proceeds
thereof) subject to such purchase money financing, (d) liens to the extent
they secure Borrower’s obligations to a lessor of property leased to Borrower
and permitted under Section 5.2(d) hereof provided that such liens do not
extend beyond the assets (including accessions, additions, parts, replacements,
fixtures, improvements and attachments thereto, and the proceeds thereof)
subject to such permitted lease, (e) liens for taxes, fees, assessments or
other government charges or levies, either not delinquent or being contested in
good faith pursuant to appropriate proceedings and for which Borrower maintains
adequate reserves on its books in accordance with GAAP, (f) liens incurred in
the extension, renewal or refinancing of the indebtedness secured by Liens
described in (b) through (d), but any extension, renewal or replacement Lien
must be limited to the property encumbered by the existing Lien and the terms
relating to principal amount, amortization, maturity, collateral (if any) and
subordination (if any), and other material terms taken as a whole, of any such
refinancing, refunding, renewing or extending indebtedness, and of any agreement
entered into and of any instrument issued in connection therewith, are no less
favorable in any material respect to Borrower than the terms of any agreement or
instrument governing the indebtedness being refinanced, refunded, renewed or
extended and the interest rate applicable to any such refinancing, refunding,
renewing or extending indebtedness does not exceed the then applicable market
interest rate; (g) leases, subleases, licenses or sublicenses of property
granted in the ordinary course of business and not substantial in amount; (h)
liens in favor of other financial institutions arising in connection with
Borrower’s deposit or securities accounts held at such institutions; (i) liens
to secure payment of workers’ compensation, employment insurance, old-age
pensions, social security and other like obligations incurred in the ordinary
course of business (other than Liens imposed by ERISA); (j) liens on property
of, or on shares of stock or Indebtedness of, any corporation existing at the
time such corporation becomes, or becomes a part of, any subsidiary; provided
that such liens do not extend to or cover any property or assets of Borrower or
any subsidiary other than the property or assets acquired and the proceeds and
products thereof and were not incurred in anticipation of such person becoming a
subsidiary; (k) liens arising by operation of law and in the ordinary
course of Borrower’s and its subsidiaries’ business of landlords and carriers,
warehousemen, mechanics, suppliers, sellers, material men or repairmen, or other
similar liens; (l) easements, rights-of-way, municipal and zoning and building
ordinances and similar charges, encumbrances, title defects or other
irregularities, governmental restrictions on the use of property or conduct of
business, and liens in favor of governmental authorities and public utilities,
that do not materially interfere with the ordinary course of business of
Borrower and its subsidiaries; (m) liens arising from the rendering of an
interim or final judgment or order against Borrower or any subsidiary that does
not give rise to an Event of Default; and (n) liens arising in the ordinary
course of Borrower’s and/or its subsidiaries’ business in favor of customs and
revenue authorities arising as a matter of law to secure payment of customs
duties in connection with the importation of goods.
12
Article
VI
Events
of Default
Section
6.1. The occurrence of any of the following shall
constitute an “Event of
Default” under this Agreement:
(a)
Borrower shall fail to pay when due any principal, interest, fees or other
amounts payable under any of the Loan Documents and such failure, in the case of
interest, fees or other amounts continues for five (5) business
days.
(b)
Any financial statement or certificate furnished to Bank in connection with, or
any representation or warranty made by Borrower or any other party under this
Agreement or any other Loan Document shall prove to be incorrect, false or
misleading in any material respect when furnished or made.
(c)
Any default in the performance of or compliance with any obligation, agreement
or other provision contained herein or in any other Loan Document (other than
those referred to in subsections (a) and (b) above), and with respect to any
such default which by its nature can be cured, such default shall continue for a
period of thirty (30) days.
(d)
Borrower or POCI: (i) fails to make any payment when due (whether by
scheduled maturity, required prepayment, acceleration, demand, or otherwise) in
respect of any debt having an aggregate principal amount (including undrawn
committed or available amounts and including amounts owing to all creditors
under any combined or syndicated credit arrangement) of more than $500,000; or
(ii) fails to observe or perform any other agreement or condition relating to
any such other debt or contained in any document evidencing, securing or
relating to any of the foregoing, or any other default or event occurs, the
effect of which default or other event is to cause, or to permit the holder or
holders of such debt (or a trustee or agent on behalf of such holder or holders)
to cause, with the giving of notice if required, such debt to be demanded or to
become due or to be repurchased, prepaid, defeased or redeemed (automatically or
otherwise), or an offer to repurchase, prepay, defease or redeem such Debt to be
made, prior to its stated maturity.
(e)
There is entered against Borrower or POCI: (i) one or more final
judgments or orders for the payment of money in an aggregate amount exceeding
$10,000,000 (to the extent not covered by independent third-party insurance as
to which the insurer does not dispute coverage); or (ii) any one or more
non-monetary final judgments that have, or could reasonably be expected to have,
individually or in the aggregate, a material adverse effect on Borrower or POCI,
as applicable, and, in either case: (A) enforcement proceedings are
commenced by any creditor upon such judgment or order; or (B) there is a period
of thirty consecutive days during which a stay of enforcement of such judgment,
by reason of a pending appeal or otherwise, is not in effect.
13
(f)
Borrower or POCI shall become insolvent, or shall suffer or consent to or apply
for the appointment of a receiver, trustee, custodian or liquidator of itself or
any of its property, or shall generally fail to pay its debts as they become
due, or shall make a general assignment for the benefit of creditors; Borrower
or POCI shall file a voluntary petition in bankruptcy, or seeking
reorganization, in order to effect a plan or other arrangement with creditors or
any other relief under the Bankruptcy Reform Act, Title 11 of the United States
Code, as amended or recodified from time to time (“Bankruptcy Code”), or under
any state or federal law granting relief to debtors, whether now or hereafter in
effect; or any involuntary petition or proceeding pursuant to the Bankruptcy
Code or any other applicable state or federal law relating to bankruptcy,
reorganization or other relief for debtors is filed or commenced against
Borrower or POCI, or Borrower or POCI shall file an answer admitting the
jurisdiction of the court and the material allegations of any involuntary
petition; or Borrower or POCI shall be adjudicated a bankrupt, or an order for
relief shall be entered against Borrower or POCI by any court of competent
jurisdiction under the Bankruptcy Code or any other applicable state or federal
law relating to bankruptcy, reorganization or other relief for
debtors.
(g)
There shall exist or occur any event or condition that has a Material Adverse
Effect.
(h)
The dissolution or liquidation of Borrower or POCI (other than the dissolution
or liquidation of POCI into Borrower); or Borrower or POCI, or any of its
directors or stockholders, shall take action seeking to effect the dissolution
or liquidation of Borrower or POCI (other than the dissolution or liquidation of
POCI into Borrower).
Section
6.2. Remedies. Upon the occurrence of
any Event of Default: (a) all indebtedness of Borrower under
each of the Loan Documents, any term thereof to the contrary notwithstanding,
shall at Bank’s option and without notice become immediately due and payable
without presentment, demand, protest or notice of dishonor, all of which are
hereby expressly waived by Borrower; (b) the obligation, if any, of Bank to
extend any further credit under any of the Loan Documents shall immediately
cease and terminate; and (c) Bank shall have all rights, powers and
remedies available under each of the Loan Documents, or accorded by law,
including without limitation the right to resort to any or all security for any
credit subject hereto and to exercise any or all of the rights of a beneficiary
or secured party pursuant to applicable law. All rights, powers and
remedies of Bank may be exercised at any time by Bank and from time to time
after the occurrence of an Event of Default, are cumulative and not exclusive,
and shall be in addition to any other rights, powers or remedies provided by law
or equity.
Article
VII
Miscellaneous
Section
7.1. No Waiver. No delay, failure or
discontinuance of Bank in exercising any right, power or remedy under any of the
Loan Documents shall affect or operate as a waiver of such right, power or
remedy; nor shall any single or partial exercise of any such right, power or
remedy preclude, waive or otherwise affect any other or further exercise thereof
or the exercise of any other right, power or remedy. Any waiver,
permit, consent or approval of any kind by Bank of any breach of or default
under any of the Loan Documents must be in writing and shall be effective only
to the extent set forth in such writing.
14
Section
7.2. Notices. All notices, requests
and demands which any party is required or may desire to give to any other party
under any provision of this Agreement must be in writing delivered to each party
at the following address:
|
Borrower:
|
Peet’s
Coffee & Tea, Inc.
|
1400 Park
Avenue
Emeryville,
CA 94608-3520
|
Bank:
|
Wells
Fargo Bank, National
Association
|
East Bay
RCBO
One
Kaiser Plaza, Suite #850
Oakland,
CA 94612
or to
such other address as any party may designate by written notice to all other
parties. Each such notice, request and demand shall be deemed given
or made as follows: (a) if sent by hand delivery, upon delivery;
(b) if sent by mail, upon the earlier of the date of receipt or three (3)
days after deposit in the U.S. mail, first class and postage prepaid; and
(c) if sent by telecopy, upon receipt.
Section
7.3. Costs, Expenses and Attorneys’
Fees. Borrower shall pay to Bank immediately upon demand the
full amount of all payments, advances, charges, costs and expenses, including
reasonable attorneys’ fees (to include outside counsel fees but not including
any allocated costs of Bank’s in-house counsel), expended or incurred by Bank in
connection with (a) the negotiation and preparation of this Agreement and
the other Loan Documents, Bank’s continued administration hereof and thereof,
and the preparation of any amendments and waivers hereto and thereto,
(b) the enforcement of Bank’s rights and/or the collection of any amounts
which become due to Bank under any of the Loan Documents, and (c) the
prosecution or defense of any action in any way related to any of the Loan
Documents, including without limitation, any action for declaratory relief,
whether incurred at the trial or appellate level, in an arbitration proceeding
or otherwise, and including any of the foregoing incurred in connection with any
bankruptcy proceeding (including without limitation, any adversary proceeding,
contested matter or motion brought by Bank or any other person) relating to
Borrower or any other person or entity.
Section
7.4. Successors, Assignment. This
Agreement shall be binding upon and inure to the benefit of the heirs,
executors, administrators, legal representatives, successors and assigns of the
parties; provided however, that Borrower may not assign or transfer its
interests or rights hereunder without Bank’s prior written
consent. Bank reserves the right to sell, assign, transfer, negotiate
or grant participations in all or any part of, or any interest in, Bank’s rights
and benefits under each of the Loan Documents. In connection
therewith, Bank may disclose all documents and information which Bank now has or
may hereafter acquire relating to any credit subject hereto, Borrower or its
business, any guarantor hereunder or the business of such
guarantor.
15
Section
7.5. Entire Agreement; Amendment. This
Agreement and the other Loan Documents constitute the entire agreement between
Borrower and Bank with respect to each credit subject hereto and supersede all
prior negotiations, communications, discussions and correspondence concerning
the subject matter hereof. This Agreement may be amended or modified
only in writing signed by each party hereto.
Section
7.6. No Third Party
Beneficiaries. This Agreement is made and entered into for the
sole protection and benefit of the parties hereto and their respective permitted
successors and assigns, and no other person or entity shall be a third party
beneficiary of, or have any direct or indirect cause of action or claim in
connection with, this Agreement or any other of the Loan Documents to which it
is not a party.
Section
7.7. Time. Time is of the essence of
each and every provision of this Agreement and each other of the Loan
Documents.
Section
7.8. Severability of Provisions. If any
provision of this Agreement shall be prohibited by or invalid under applicable
law, such provision shall be ineffective only to the extent of such prohibition
or invalidity without invalidating the remainder of such provision or any
remaining provisions of this Agreement.
Section
7.9. Counterparts. This Agreement may be
executed in any number of counterparts, each of which when executed and
delivered shall be deemed to be an original, and all of which when taken
together shall constitute one and the same Agreement.
Section
7.10. Governing Law. This Agreement shall be
governed by and construed in accordance with the laws of the State of
California.
Section
7.11. Arbitration.
(a)
Arbitration. The
parties hereto agree, upon demand by any party, to submit to binding arbitration
all claims, disputes and controversies between or among them (and their
respective employees, officers, directors, attorneys, and other agents), whether
in tort, contract or otherwise in any way arising out of or relating to (i) any
credit subject hereto, or any of the Loan Documents, and their negotiation,
execution, collateralization, administration, repayment, modification,
extension, substitution, formation, inducement, enforcement, default or
termination; or (ii) requests for additional credit.
(b)
Governing
Rules. Any arbitration proceeding will (i) proceed in a
location in California selected by the American Arbitration Association (“AAA”);
(ii) be governed by the Federal Arbitration Act (Title 9 of the United States
Code), notwithstanding any conflicting choice of law provision in any of the
documents between the parties; and (iii) be conducted by the AAA, or such other
administrator as the parties shall mutually agree upon, in accordance with the
AAA’s commercial dispute resolution procedures, unless the claim or counterclaim
is at least $1,000,000 exclusive of claimed interest, arbitration fees and costs
in which case the arbitration shall be conducted in accordance with the AAA’s
optional procedures for large, complex commercial disputes (the commercial
dispute resolution procedures or the optional procedures for large, complex
commercial disputes to be referred to herein, as applicable, as the “Rules”). If there
is any inconsistency between the terms hereof and the Rules, the terms and
procedures set forth herein shall control. Any party who fails or
refuses to submit to arbitration following a demand by any other party shall
bear all costs and expenses incurred by such other party in compelling
arbitration of any dispute. Nothing contained herein shall be deemed
to be a waiver by any party that is a bank of the protections afforded to it
under 12 U.S.C. §91 or any similar applicable state law.
16
(c)
No Waiver of Provisional
Remedies, Self-Help and Foreclosure. The arbitration
requirement does not limit the right of any party to (i) foreclose against real
or personal property collateral; (ii) exercise self-help remedies relating to
collateral or proceeds of collateral such as setoff or repossession; or (iii)
obtain provisional or ancillary remedies such as replevin, injunctive relief,
attachment or the appointment of a receiver, before during or after the pendency
of any arbitration proceeding. This exclusion does not constitute a
waiver of the right or obligation of any party to submit any dispute to
arbitration or reference hereunder, including those arising from the exercise of
the actions detailed in sections (i), (ii) and (iii) of this
paragraph.
(d)
Arbitrator Qualifications and
Powers. Any arbitration proceeding in which the amount in
controversy is $5,000,000 or less will be decided by a single arbitrator
selected according to the Rules, and who shall not render an award of greater
than $5,000,000. Any dispute in which the amount in controversy
exceeds $5,000,000 shall be decided by majority vote of a panel of three
arbitrators; provided however, that all three arbitrators must actively
participate in all hearings and deliberations. The arbitrator will be
a neutral attorney licensed in the State of California or a neutral retired
judge of the state or federal judiciary of California, in either case with a
minimum of ten years experience in the substantive law applicable to the subject
matter of the dispute to be arbitrated. The arbitrator will determine
whether or not an issue is arbitratable and will give effect to the statutes of
limitation in determining any claim. In any arbitration proceeding
the arbitrator will decide (by documents only or with a hearing at the
arbitrator’s discretion) any pre-hearing motions which are similar to motions to
dismiss for failure to state a claim or motions for summary
adjudication. The arbitrator shall resolve all disputes in accordance
with the substantive law of California and may grant any remedy or relief that a
court of such state could order or grant within the scope hereof and such
ancillary relief as is necessary to make effective any award. The
arbitrator shall also have the power to award recovery of all costs and fees, to
impose sanctions and to take such other action as the arbitrator deems necessary
to the same extent a judge could pursuant to the Federal Rules of Civil
Procedure, the California Rules of Civil Procedure or other applicable
law. Judgment upon the award rendered by the arbitrator may be
entered in any court having jurisdiction. The institution and
maintenance of an action for judicial relief or pursuit of a provisional or
ancillary remedy shall not constitute a waiver of the right of any party,
including the plaintiff, to submit the controversy or claim to arbitration if
any other party contests such action for judicial relief.
(e)
Discovery. In any
arbitration proceeding, discovery will be permitted in accordance with the
Rules. All discovery shall be expressly limited to matters directly
relevant to the dispute being arbitrated and must be completed no later than 20
days before the hearing date. Any requests for an extension of the
discovery periods, or any discovery disputes, will be subject to final
determination by the arbitrator upon a showing that the request for discovery is
essential for the party’s presentation and that no alternative means for
obtaining information is available.
17
(f)
Class Proceedings and
Consolidations. No party hereto shall be entitled to join or
consolidate disputes by or against others in any arbitration, except parties who
have executed any Loan Document, or to include in any arbitration any dispute as
a representative or member of a class, or to act in any arbitration in the
interest of the general public or in a private attorney general capacity.
(g)
Payment Of Arbitration Costs
And Fees. The arbitrator shall award all costs and expenses of
the arbitration proceeding.
(h)
[Reserved].
(i)
Miscellaneous. To
the maximum extent practicable, the AAA, the arbitrators and the parties shall
take all action required to conclude any arbitration proceeding within 180 days
of the filing of the dispute with the AAA. No arbitrator or other
party to an arbitration proceeding may disclose the existence, content or
results thereof, except for disclosures of information by a party required in
the ordinary course of its business or by applicable law or
regulation. If more than one agreement for arbitration by or between
the parties potentially applies to a dispute, the arbitration provision most
directly related to the Loan Documents or the subject matter of the dispute
shall control. This arbitration provision shall survive termination,
amendment or expiration of any of the Loan Documents or any relationship between
the parties.
(j)
Small Claims
Court. Notwithstanding anything herein to the contrary, each
party retains the right to pursue in Small Claims Court any dispute within that
court’s jurisdiction. Further, this arbitration provision shall apply
only to disputes in which either party seeks to recover an amount of money
(excluding attorneys’ fees and costs) that exceeds the jurisdictional limit of
the Small Claims Court.
Section
7.12. No Novation. This Agreement
amends and restates the Existing Agreement in its entirety, effective as of the
date hereof, and is not intended to constitute a novation of the obligations
thereunder.
Section
7.13. Accounting Changes. Borrower and
Bank acknowledge and agree that, notwithstanding any change in GAAP after the
date of this Agreement relating to lease accounting, for purposes of the
financial ratios, financial covenants and other requirements set forth in this
Agreement and the other Loan Documents (including, without limitation, for
purposes of Sections 1.2, 4.9 and 5.2 hereof), such financial ratios,
financial covenants and other requirements shall be computed in accordance with
GAAP as in effect prior to such change.
18
Section
7.14. Release of Liens. Bank hereby
terminates and releases all liens granted by Borrower and its subsidiaries in
favor of Bank pursuant to the Existing Agreement (and any related security or
pledge agreement) and agrees, at the sole expense of Borrower, to deliver such
documents as Borrower shall reasonably request to evidence such release and
termination.
[Signatures
on following page]
19
In
Witness Whereof, the parties hereto have caused this Agreement to be
executed as of the day and year first written above.
|
Wells
Fargo Bank,
|
||||
|
Peet’s
Coffee & Tea, Inc.
|
National
Association
|
|||
|
By:
|
By:
|
|||
|
Thomas
P. Cawley
|
Todd
G. Tajiri
|
|||
|
Chief
Financial Officer,
|
Vice
President
|
|||
|
Vice
President, Secretary
|
||||
Amended
and Restated Credit Agreement
20
Exhibit
A
|
To:
|
Wells
Fargo Bank, National
Association
|
One
Kaiser Plaza, Suite 850
Oakland,
CA 94612
Attn: Todd
Tajiri
|
Re:
|
Peet’s
Coffee & Tea, Inc.
|
(“Borrower”)
The
undersigned is the Chief Financial Officer of Borrower. In said
capacity, the undersigned hereby certifies to Wells Fargo Bank, National
Association (“Bank”)
that (a) the financial statement of Borrower dated as of ________________,
______, heretofore or concurrently herewith delivered by Borrower to Bank, and
all schedules and footnotes thereto, fairly present the financial condition and
results of operations as of and for the period set forth therein, and (b) as of
the date hereof, there exists no default or defined Event of Default under the
Amended and Restated Credit Agreement, dated as of December 21, 2010, by
and between the Borrower and Bank, as amended, modified and/or supplemented
prior to the date hereof.
Dated: _______________,
______
|
By:
|
||
|
Title:
|
||
21
Schedule
I
To
Compliance Certificate for
Peet’s
Coffee & Tea, Inc.
Financial
Statement Date: _____________
|
I. Section 4.9(a) Leverage
Ratio
|
|||||||
|
A.
|
Total
Funded Debt
|
||||||
|
1.
|
the
outstanding principal amount of all obligations for borrowed money and all
obligations evidenced by bonds, debentures, notes, loan agreements or
other similar instruments
|
—
|
|||||
|
2.
|
all
purchase money debt
|
—
|
|||||
|
3.
|
all
direct obligations arising under letters of credit, bankers’ acceptances,
bank guaranties, surety bonds and similar instruments
|
—
|
|||||
|
4.
|
all
obligations in respect of the deferred purchase price of property or
services
|
—
|
|||||
|
5.
|
the
capitalized amount of any capital leases
|
—
|
|||||
|
6.
|
the
amount of all guarantees
|
—
|
|||||
|
7.
|
Sum
of Lines A.1. through A.6
|
—
|
|||||
|
B.
|
Adjusted
Annual Rental Expense
|
||||||
|
1.
|
Annual
Rental Expense
|
—
|
|||||
|
2.
|
Multiplied
by six (6)
|
—
|
|||||
|
C.
|
Annual
EBITDA
|
||||||
|
1.
|
income
before tax
|
—
|
|||||
|
2.
|
interest
expense (net of capitalized interest expense)
|
—
|
|||||
|
3.
|
depreciation
expense
|
||||||
|
4.
|
amortization
expense
|
||||||
|
5.
|
non-cash
stock compensation expense
|
||||||
|
6.
|
Sum
of Lines C.1. plus C.2. plus C.3. plus C.4. plus C.5.
|
—
|
|||||
|
D.
|
Annual
Rental Expense
|
—
|
|||||
|
Actual
Leverage Ratio (A.7. + B.2.)/(C.5. + D)
|
—
|
||||||
|
Required
Maximum
|
2.50
|
x
|
|||||
|
Borrower
is in Compliance Y/N
|
|||||||
|
II. Section
4.9(b) Net Income After Tax Provision
|
|||||||
|
A.
|
Net
income after tax provision for current quarter
|
—
|
|||||
|
Required
Minimum
|
$
|
1.00
|
|||||
|
Borrower
is in Compliance Y/N
|
|
||||||
22