Seventh Amendment to Amended and Restated Credit Agreement among Einstein/Noah Bagel Corp., Lenders, and Bank of America, N.A.

Summary

This amendment updates the existing credit agreement between Einstein/Noah Bagel Corp. (and related parties), Bank of America, N.A. (as Agent), General Electric Capital Corporation (as Co-Agent), and various lenders. The amendment allows for a new exit financing commitment to replace the previous one, modifies related definitions, and sets new conditions for the termination date of the credit facility. The changes are subject to approval by the Bankruptcy Court and require certain conditions to be met for effectiveness.

EX-10.1(H) 3 0003.txt SEVENTH AMENDMENT EXECUTION COPY EXHIBIT 10.1(h) SEVENTH AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT THIS SEVENTH AMENDMENT TO THE AMENDED AND RESTATED CREDIT AGREEMENT (hereinafter referred to as the "Amendment") is being executed and delivered as --------- of October 31, 2000 by and among Einstein/Noah Bagel Corp., a Delaware corporation formerly known as Einstein Bros. Bagels, Inc. (as debtor-in- possession, the "Borrower"), Einstein/Noah Bagel Partners, L.P., a Delaware -------- limited partnership (as debtor-in-possession, the "Partnership", each of the ----------- Borrower and the Partnership being hereinafter sometimes referred to individually as a "Debtor" and hereinafter sometimes referred to collectively as ------ "Debtors"), Einstein/Noah Bagel Partners, Inc., a California corporation ------- formerly known as Noah's New York Bagels, Inc. (the "Corporate GP", and together ------------ with the Borrower and the Partnership, collectively, the "Credit Parties" and -------------- each individually a "Credit Party"), Bank of America, N.A. (as successor to Bank ------------ of America National Trust and Savings Association), as the "Agent" for the Lenders (the "Agent"), General Electric Capital Corporation, as "Co-Agent" for ----- the Lenders (the "Co-Agent"), and the financial institutions from time to time -------- party to the Credit Agreement referred to and defined below (collectively, the "Lenders", and each individually, a "Lender"). Undefined capitalized terms - -------- ------ which are used herein shall have the meanings ascribed to such terms in the Credit Agreement. W I T N E S S E T H: WHEREAS, the Borrower, the Lenders, the Agent and the Co-Agent are parties to that certain Amended and Restated Secured Credit Agreement dated as of November 21, 1997 (as heretofore amended and modified by that certain First Amendment and Waiver thereto dated as of March 27, 1998, that certain Consent thereto dated as of May 7, 1998, that certain Second Amendment thereto dated as of October 4, 1998, that certain Third Amendment and Waiver thereto dated as of January 29, 1999, that certain Fourth Amendment and Waiver thereto dated as of May 15, 1999, that certain Fifth Amendment and Waiver thereto dated as of February 29, 2000, and that certain Restated Sixth Amendment and Waiver thereto dated as of April 27, 2000 and restated as of June 15, 2000, in each case among such parties, collectively, the "Credit Agreement"), pursuant to which the ---------------- Lenders have agreed to provide, subject to the terms and conditions contained therein, certain loans and other financial accommodations to the Borrower; and WHEREAS, in connection with the Credit Agreement, and to provide additional security for the Borrower's obligations thereunder, each of the Partnership and the Corporate GP executed and delivered to the Agent, for the benefit of the Lenders, certain guaranties, security agreements, pledge agreements and other Loan Documents; WHEREAS, on April 27, 2000, each of the Debtors filed with the United States Bankruptcy Court for the District of Arizona (the "Bankruptcy Court") ---------------- voluntary petitions for relief under Chapter 11 of title 11 of the United States Code, 11 U.S.C. (S)(S)101 et seq. and have continued in the possession of their assets pursuant -- --- to Sections 1107 and 1108 thereof; WHEREAS, in connection with such filings and at the Debtors' request, the Bankruptcy Court entered a final order authorizing the Borrower to borrow Revolving Loans and to obtain Letters of Credit in a maximum aggregate principal amount of $36,000,000 under the Credit Agreement subject to the terms and conditions of such order, this Amendment, and the Loan Documents; WHEREAS, pursuant to the Credit Agreement, such Revolving Loans and Letters of Credit may be provided through and including the Termination Date, after which date no additional Revolving Loans or Letters of Credit will be available and upon which date all outstanding Revolving Loans and LC Obligations must be repaid in full; WHEREAS, the Termination Date is currently defined to occur upon the earliest of (i) December 31, 2000, (ii) the date on which a plan of reorganization in the Case becomes effective and (iii) the stated expiry date of the Exit Financing Commitment; WHEREAS, the Exit Financing Commitment expires as of the date hereof; WHEREAS, the Borrower has obtained a substitute exit financing commitment from another lender subject to the approval of the Bankruptcy Court, a copy of which commitment is attached hereto as Exhibit A (the "Replacement --------- ----------- Exit Financing Commitment"); and - ------------------------- WHEREAS, the Borrower has requested that the Lenders agree, and subject to the terms and conditions of this Amendment the Lenders have agreed, to amend the Credit Agreement to allow for a substitution of the Replacement Exit Financing Commitment for the existing Exit Financing Commitment and a modification to the definitions of "Exit Financing Commitment" and "Termination Date" to effect such substitution. NOW, THEREFORE, in consideration of the foregoing premises, the terms and conditions stated herein and other valuable consideration the receipt and sufficiency of which are hereby acknowledged by the Credit Parties, the Lenders, the Agent and the Co-Agent, such parties hereby agree as follows: 1. Amendment No. 7 to Credit Agreement. Subject to the satisfaction ----------------------------------- of each of the conditions set forth in Paragraph 2 of this Amendment, the Credit ----------- Agreement is hereby amended as follows (article and section references used herein refer to those of the Credit Agreement): (a) Article I is amended to delete the definitions of "Exit --------- Financing Commitment" and "Termination Date" in their entirety and to replace such definitions with the following definitions: "'Exit Financing Commitment' means the commitment evidenced and governed by that certain commitment letter dated October 26, 2000, as modified by that certain letter agreement dated as of November 3, 2000, copies of which are attached to 2 that certain Seventh Amendment to this Agreement dated as of October 31, 2000 among the Borrower, the Partnership, the Corporate GP, the Agent, the Co-Agent and the Lenders, as Exhibit A to such Seventh Amendment, or such other commitment, in form and substance satisfactory to the Agent and the Required Lenders, by a lender or financial institution to provide financing to the Borrower upon or after the confirmation of a plan of reorganization of the Borrower by the Bankruptcy Court pursuant to the Case, which financing shall be in an amount equal to or greater than $57,750,000." "'Termination Date' means the earliest to occur of (1) December 31, 2000; (2) the date on which a plan of reorganization in the Case becomes effective, (3) the failure of the Bankruptcy Court to enter an order approving the Exit Financing Commitment on or before November 9, 2000 and (4) the expiration of the Exit Financing Commitment." (b) Section 6.18(g) is deleted in its entirety and replaced with the --------------- following provision: "(g) Amend or otherwise modify the Exit Financing Commitment in any manner to impose additional conditions, covenants or other requirements upon the Borrower or its Subsidiaries or the Lenders, or to change the stated expiration date set forth therein to an earlier date, or to make any existing conditions, covenants or other requirements more onerous to the Borrower or its Subsidiaries or the Lenders." 2. Effectiveness of this Amendment; Conditions Precedent. The ----------------------------------------------------- provisions of Paragraph 1 hereof shall be deemed to have become effective as of ----------- the date hereof, but such effectiveness shall be expressly conditioned upon the Agent's receipt of an originally-executed counterpart of this Amendment executed and delivered by a duly authorized officer of the Credit Parties and the Lenders. 3. Representations and Warranties. Each Credit Party hereby ------------------------------ represents and warrants that: (a) this Amendment constitutes the legal, valid and binding obligation of each Credit Party enforceable against such Credit Party in accordance with its terms; (b) each Credit Party's execution and delivery of this Amendment, and its performance hereafter of the Loan Documents as modified by this Amendment, have been duly authorized by all necessary corporate or partnership action, do not violate any provision of its certificate of incorporation, bylaws, partnership agreement or other organizational documents, will not violate any law, regulation, court order or writ applicable to it, will not require the approval or consent of any governmental agency (including, without limitation, the approval of the Bankruptcy Court), and except as may have otherwise been heretofore obtained, will not require the approval or consent of any third party under the terms of any contract or agreement to which any Credit Party or any Subsidiary or other Affiliate of any Credit Party is bound; (c) no Default has occurred and is continuing or will have occurred and be continuing and all of the representations and warranties of each Credit Party contained in the Credit Agreement and the other Loan Documents (other than such representations or warranties 3 which, in accordance with their express terms, are made only as of a specified date) are, and will be, true and correct as of the date of the Credit Parties' execution hereof in all material respects as though made on and as of such date. 4. Reference to and Effect on Credit Agreement and Other Loan ---------------------------------------------------------- Documents. The Credit Agreement and each of the other Loan Documents, as - --------- amended hereby, shall remain in full force and effect and are hereby ratified and confirmed. Neither the execution, delivery nor effectiveness of this Amendment shall operate as a waiver of any right, power or remedy of the Agent or any Lender of any Default under the Credit Agreement, all of which the Agent and the Lenders hereby expressly reserve. The Credit Parties, the Lenders and the Agent agree and acknowledge that this Amendment constitutes a "Loan Document" under and as defined in the Credit Agreement. 5. Governing Law. This Amendment shall be governed by and construed ------------- in accordance with the laws and decisions of the State of Illinois. 6. Agents' Expenses. The Borrower hereby agrees that the Agent has ---------------- been authorized by the Borrower to charge all the reasonable out-of-pocket fees and expenses (including, without limitation, attorneys' and paralegals' fees, it or the Co-Agent has heretofore or hereafter incurred or incurs in connection with the preparation, negotiation and execution of this Amendment) to the Borrower's Account, which authorization is hereby ratified and confirmed by the Borrower. 7. Reaffirmations by the Partnership and the Corporate GP. The ------------------------------------------------------ Partnership and the Corporate GP, in their respective capacities as guarantors, pledgors, grantors, contributors, or other providers of financial accommodations under the terms of the Loan Documents (including, without limitation, under that certain Guaranty dated as of May 17, 1996 executed and delivered by the Corporate GP in favor of the Agent and the Lenders, that certain Guaranty dated as of December 5, 1997 executed and delivered by the Partnership in favor of the Agent and the Lenders, and each of the other Loan Documents to which the Corporate GP or the Partnership is a party), hereby each reaffirms and ratifies each of its obligations, covenants, guaranties, grants of security interests, pledges, grants of liens and other undertakings and accommodations under the Loan Documents to which it is a party, all of which shall hereafter remain in full force and effect, with respect to both Pre-Petition Obligations and Post- Petition Obligations. Each of the Partnership and the Corporate GP hereby further agrees to carry out each term, provision, covenant and condition of the Credit Agreement as modified by Paragraph 1 of this Amendment. Each of the ----------- Partnership and the Corporate GP hereby agree and acknowledge it is truly and justly indebted as a guarantor with respect to all Pre-Petition Obligations and Post-Petition Obligations of the Borrower, without setoff, defense or counterclaim. 8. Counterparts. This Amendment may be executed in counterparts, ------------ each of which shall be an original and all of which together shall constitute one and the same agreement among the parties. * * * 4 IN WITNESS WHEREOF, this Amendment has been duly executed as of the day and year first above written. EINSTEIN/NOAH BAGEL CORP., as debtor and debtor- in-possession By: /s/ Paul A. Strasen ------------------------------------------- Name: Paul A. Strasen Title: Sr. Vice President, General Counsel & Secretary EINSTEIN/NOAH BAGEL PARTNERS, L.P., as debtor and debtor-in-possession By: EINSTEIN/NOAH BAGEL PARTNERS, INC., as General Partner By: /s/ Paul A. Strasen ------------------------------------------- Name: Paul A. Strasen Title: Vice President & Secretary EINSTEIN/NOAH BAGEL PARTNERS, INC. By: /s/ Paul A. Strasen ------------------------------------------- Name: Paul A. Strasen Title: Vice President & Secretary BANK OF AMERICA, N.A.., as the Agent By: /s/ David A. Johanson ------------------------------------------- Name: David A. Johanson Title: Vice President BANK OF AMERICA, N.A.., as a Lender By: /s/ Michael Staunton ------------------------------------------- Name: Michael Staunton Title: Vice President 5 GENERAL ELECTRIC CAPITAL CORPORATION, as a Lender and as Co- Agent By: /s/ Jeff Fitts ------------------------------------------- Name: Jeff Fitts Title: Senior Risk Manager LASALLE BANK NATIONAL ASSOCIATION, (as successor to LaSalle National Bank), as a Lender By: /s/ David C. Shapiro ------------------------------------------- Name: David C. Shapiro Title: First Vice President 6