Friendly Ice Cream amends revolver to change financial covenants, increase commitment fee

By Sara Rosenberg

New York, Dec. 23 - Friendly Ice Cream Corp. amended its revolving credit facility, changing financial covenants (see tables 1, 2 and 3), eliminating the minimum quarterly EBITDA requirement, changing the annual capital expenditures limit and increasing the commitment fee to 75 basis points from 50 basis points, according to an 8-K filed with the Securities and Exchange Commission Thursday.

Fleet National Bank is the administrative agent on the loan.

The amendment became effective on Dec. 17.

Friendly is a Wilbraham, Mass., operator of full-service restaurants, distributor and seller of ice cream desserts through retail and institutional locations, and a franchiser.

Table 1: Interest Coverage Ratio:

Period Interest Coverage Ratio

Fourth fiscal quarter 2004 and first and second fiscal quarters 2005 2.00:1.00

Third and fourth fiscal quarters 2005 2.15:1.00

First and second fiscal quarters 2006 2.25:1.00

Third and fourth fiscal quarters 2006 and each fiscal quarter thereafter 2.50:1.00

Table 2: Leverage Ratio

Period Leverage Ratio

Fourth fiscal quarter 2004 5.50:1.00

First fiscal quarter 2005 5.75:1.00

Second Fiscal Quarter of 2005 5.50:1.00

Third and fourth fiscal quarters 2005 5.00:1.00

First and second fiscal quarters 2006 4.75:1.00

Third and fourth fiscal quarters 2006 4.25:1.00

Each fiscal quarter thereafter 4.00:1.00

Table 3: Fixed Charge Coverage Ratio

Period Fixed Charge Coverage Ratio

Fourth fiscal quarter 2004 and first fiscal quarter 2005 1.00:1.00

Second fiscal quarter 2005 and each fiscal quarter thereafter 1.05:1.00

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