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EXHIBIT 10.36
CONSENT
THIS CONSENT, dated as of July 29, 1999, (the "CONSENT") relating to
the Credit Agreement referenced below, is by and among FRESH FOODS, INC., a
North Carolina corporation (the "COMPANY"), the subsidiaries of the Company
listed on the signature pages hereto (collectively referred to as the
"SUBSIDIARY BORROWERS" or individually referred to as a "SUBSIDIARY BORROWER")
(hereinafter, the Company and the Subsidiary Borrowers are collectively referred
to as the "BORROWERS" or individually referred to as a "BORROWER"), each of
those financial institutions identified as Lenders on the signature pages hereto
(together with each of their successors and assigns, referred to individually as
a "LENDER" and, collectively, as the "LENDERS"), and FIRST UNION COMMERCIAL
CORPORATION ("FUCC"), acting in the manner and to the extent described in
Article XIII of the Credit Agreement (in such capacity, the "AGENT"). Terms used
herein but not otherwise defined herein shall have the meanings provided in the
Credit Agreement.
W I T N E S S E T H
WHEREAS, a $75,000,000 credit facility was extended to the Borrowers
pursuant to the terms of that certain Credit Agreement dated as of June 9, 1998
(as amended, modified or otherwise supplemented, the "CREDIT AGREEMENT") among
the Borrowers, the Lenders and the Agent;
WHEREAS, the Borrowers have requested that the Lenders and the Agent
consent to certain matters related to the Credit Agreement as described herein;
and
WHEREAS, the Lenders are willing to make give such consents;
NOW, THEREFORE, IN CONSIDERATION of these premises and other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereto agree as follows:
1. The following new definitions are applicable to this
Consent:
"MOM 'N' POP'S LOAN" shall mean a revolving credit
loan in the amount of $500,000 made by the Company to Mom 'n'
Pop's Country Ham, LLC to provide working capital with a
scheduled maturity date of July 1, 2000.
"SMOKEHOUSE" shall mean the smokehouse facility and
related real property constituting a portion of the Claremont
Office property owned by Fresh Foods, Inc.
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2. SALE OF CERTAIN ASSETS. Notwithstanding the prohibition
contained in Section 9.3 of the Credit Agreement, the Lenders hereby
consent, subject to the terms and conditions set forth herein, to the
sale of certain assets of the Borrowers listed on Annex I hereto (the
"Sale Assets") to third parties, upon terms and conditions satisfactory
to the Agent. In connection with the sale of the Sale Assets, the
Lenders hereby authorize the Agent to release any and all Liens on the
personal property, fixtures and real property comprising the Sale
Assets.
3. SALE OF MOM 'N' POP'S, LLC. Notwithstanding the prohibition
contained in Section 9.3 of the Credit Agreement, the Lenders hereby
consent, subject to the terms and conditions set forth herein, to (a)
the sale by Pierre Foods, LLC of all of the membership interests in
Mom'n' Pop's Country Ham, LLC ("Mom 'n' Pop's") to Hoggs, LLC ("Hoggs")
in consideration of a three-year promissory note from Hoggs in the
amount of $995,000 (the "Hoggs Note") to be secured by all of the
issued and outstanding membership interests in Hoggs, and (b) (i) if
the Smokehouse is subdivided from the Claremont Office property prior
to the closing of the sale of the membership interests in Mom 'n'
Pop's, the intercompany transfer of the Smokehouse by the Company to
Mom 'n' Pop's so that the Smokehouse can be sold concurrently with the
sale of the membership interests in Mom 'n' Pop's, or (ii) if the
Smokehouse is not so subdivided from the Claremont Office property, the
lease of the Smokehouse to Mom 'n' Pop's for $1.00 and the subsequent
transfer of the Smokehouse to Mom 'n' Pop's without further
consideration upon the Smokehouse being legally subdivided from the
Claremont Office property. In connection with the sale of Mom 'n'
Pop's, the Lenders hereby authorize the Agent to release any and all
Liens on the personal property, fixtures and real property used in
connection with the business of Mom 'n' Pop's, including, without
limitation, the Smokehouse.
4. CONSENT TO LICENSE. Notwithstanding the prohibition
contained in Section 9.18 of the Credit Agreement, the Lenders hereby
consent, subject to the terms and conditions set forth herein, to the
grant by Fresh Foods Properties, LLC to Hoggs of (i) a perpetual,
worldwide license to use the trademarks set forth on Annex II hereto on
terms and conditions satisfactory to the Agent and the Lenders and (ii)
a right to purchase the trademark set forth on Annex II hereto for
$1.00 in the event Fresh Foods Properties, LLC should decide to sell
such trademark. The Lenders also consent, and authorize the Agent to
take such action when appropriate, to the release of any liens or
security interests in the trademarks set forth on Annex II hereto in
connection with the exercise by Hoggs of such right to purchase without
further payment to Lenders.
5. RELEASE OF BORROWERS. The Lenders hereby consent to the
release of the following Borrowers as parties to the Credit Agreement
and the other Credit Documents, subject to the terms and conditions set
forth herein: Mom 'n' Pop's Country Ham, LLC.
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6. RELEASE OF COLLATERAL. The Agent hereby agrees to release
its Liens on (a) the Sale Assets and (b) the personal property,
fixtures and real property used in connection with the business of Mom
'n' Pop's, such releases to be held in escrow pending consummation of
the transactions contemplated herein and the Agent's receipt of the
proceeds thereof.
7. EXCLUSION OF SALE ASSETS AND SMOKEHOUSE FROM ELIGIBLE REAL
PROPERTY. As of the date hereof, the Sale Assets and the Smokehouse
shall be excluded from the definition of Eligible Real Property, and
Eligible Real Property shall be reduced by $2,255,000.
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8. CONDITION TO SECTIONS 3, 4, 5 AND 6(b). The Lenders' and
the Agent's consent to Sections 3, 4, 5, and 6(b) shall be subject to
the following:
(a) the Agent's approval of the notes and other loan documents
in respect of the Mom 'n' Pop's Loan and the Hoggs Note.
(b) the applicable Borrower's pledge to the Lenders of the Mom
'n' Pop's Loan and the Hoggs Note pursuant to documents acceptable to
the Agent;
(c) the delivery of the original of the duly executed and
delivered note evidencing the Mom 'n' Pop's Loan and the Hoggs Note to
the Agent pursuant to the pledge agreement; and
(d) the approval of the Agent of the form of the License
Agreement referred to in Section 4 hereof.
[Remainder of page intentionally left blank.]
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IN WITNESS WHEREOF, each of the parties hereto has caused a
counterpart of this Consent to be duly executed and delivered as of the date
first above written.
COMPANY: FRESH FOODS, INC.
By: /s/ Xxxxx X. Xxxxxx
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Name: Xxxxx X. Xxxxxx
Title: Vice President
SUBSIDIARY BORROWERS: CLAREMONT RESTAURANT GROUP, LLC
By: FRESH FOODS, INC.,
its Sole Member
FRESH FOODS RESTAURANT GROUP, LLC
By: CLAREMONT RESTAURANT
GROUP, LLC, its Sole Member
By: FRESH FOODS, INC.,
its Sole Member
FRESH FOODS PROPERTIES, LLC
By: FRESH FOODS, INC.,
its Sole Member
SPICEWOOD, INC.
SUNSHINE WSMP, INC.
FRESH FOODS SALES, LLC
By: FRESH FOODS, INC.,
its Sole Member
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PIERRE FOODS, LLC
By: FRESH FOODS, INC.,
its Sole Member
MOM 'n' POP'S COUNTRY HAM, LLC
By: PIERRE FOODS, LLC,
its Sole Member
By: FRESH FOODS, INC.,
its Sole Member
SAGEBRUSH OF TENNESSEE, L.P.
By: SAGEBRUSH OF SOUTH
CAROLINA, LLC
General Partner
By: CLAREMONT RESTAURANT GROUP,
LLC, its Sole Member
By: FRESH FOODS INC.,
its sole member
SAGEBRUSH OF NORTH CAROLINA, LLC
By: CLAREMONT RESTAURANT GROUP, LLC,
its Sole Member
By: FRESH FOODS, INC.,
its sole member
SAGEBRUSH OF SOUTH CAROLINA, LLC
By: CLAREMONT RESTAURANT
GROUP, LLC, its Sole Member
By: FRESH FOODS, INC.,
its sole member
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PIERRE LEASING, LLC
By: FRESH FOODS, INC.,
its Sole Member
By: /s/ Xxxxx X. Xxxxxx
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Name: Xxxxx X. Xxxxxx
Title: Vice President
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AGENT AND LENDERS: FIRST UNION COMMERCIAL CORPORATION,
as Agent and a Lender
By: /s/ Xxxxx X. Xxxx
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Name: Xxxxx X. Xxxx
Title: Vice President
NATIONSBANK, N.A.,
as a Lender
By: /s/ Xxxxxx Xxxxxxxx Xxxxx
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Name: Xxxxxx Xxxxxxxx Xxxxx
Title: Vice President
NATIONAL CITY COMMERCIAL
FINANCE, INC.,
as a Lender
By: /s/ Xxxxxx X. Xxxxx
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Name: Xxxxxx X. Xxxxx
Title: Sr. VP
AMERICAN NATIONAL BANK AND
TRUST COMPANY OF CHICAGO,
as a Lender
By: /s/ Xxxxxxxxx X. Xxxxxxx
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Name: Xxxxxxxxx X. Xxxxxxx
Title: Senior Vice President
