EXHIBIT 10.2
LOAN AGREEMENT
THIS LOAN AGREEMENT (this "Agreement") is entered into as of December
3, 1999 among U.S. Foodservice, Inc., a Delaware corporation formerly known as
Xxxxxx-Xxxxxx, Inc., and JP Foodservice Distributors, Inc., a Delaware
corporation (collectively, the "Borrowers"), U.S. Foodservice, a Delaware
corporation formerly known as JP Foodservice, Inc. (the "Parent") and those
subsidiaries of the Borrowers identified on the signature pages hereto (together
with each other subsidiary which may become a party hereto by execution of a
joinder agreement and the Parent, the "Guarantors"); and Xxxxx Fargo Bank,
National Association ("Lender").
BACKGROUND
WHEREAS, Borrowers and Lender desire to enter into a revolving credit
facility pursuant to which Lender will make credit available to Borrowers for
the purposes hereinafter set forth; and
WHEREAS, as a condition to making such revolving credit facility available
to Borrowers, Lender has required, among other things, the Guarantors to
guarantee all of the Borrowers' obligations arising under this Agreement and any
other instruments or agreements executed pursuant hereto (collectively, the
"Loan Documents").
NOW, THEREFORE, in consideration of the foregoing and the mutual covenants
and agreements hereinafter set forth, the parties hereby agree as follows:
1. DEFINITIONS
1.1. Applicable Margin
"Applicable Margin" shall mean, for purposes of calculating (i) the
applicable interest rate for any day for any Eurodollar Loan or (ii) the
applicable rate for the Facility Fee for any day for purposes of Section 2.3
hereof, the applicable margin corresponding to the Total Debt Ratio described
below in effect as of the most recent Determination Date:
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Applicable Applicable
Margin Margin
Pricing Total Debt for for
Level Ratio Eurodollar Loans Facility Fee
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Equal to or less
II than 4.0 to 1.0 but 112.5 bps 25.0 bps
greater than 3.5 to
1.0
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I Equal to or less 102.5 bps 25.0 bps
than 3.5 to 1.0
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Determination of the appropriate Applicable Margins based on the Total Debt
Ratio shall be made as of each Determination Date. The Total Debt Ratio in
effect as of a Determination Date shall establish the Applicable Margins that
shall be effective as of the date designated by Lender as the Applicable Margin
Change Date. Lender shall determine the Applicable Margins as of each
Determination Date occurring after the Facility Closing Date and shall promptly
notify Borrowers of the Applicable Margins so determined and of the related
Applicable Margin Change Date. Such determinations by Lender of the Applicable
Margins shall be rebuttably presumptive evidence thereof. As of the Facility
Closing Date and until the first Applicable Margin Date, (a) the Applicable
Margin for purposes of calculating the applicable interest rate for any
Eurodollar Loan shall be 112.5 bps and (b) the Applicable Margin for purposes of
calculating the Facility Fee shall be 25 bps. All of the terms in this Section
1.1 shall have the meanings set forth in the Existing Credit Agreement (as
defined below), except for the terms Applicable Margin and Facility Fee, which
shall have the meanings set forth in this Agreement.
1.2. Existing Credit Agreement
"Existing Credit Agreement" shall mean that certain 364-Day Credit
Agreement dated as of December 23, 1997 among Borrowers, the lenders that are
parties thereto from time to time and Bank of America, N.A., as Administrative
Agent, Bank of America, LLC (formerly NationsBanc Xxxxxxxxxx Securities LLC and
NationsBank Xxxxxxxxxx Securities, Inc.) and Chase Securities, Inc., as Co-
Arrangers, The Chase Manhattan Bank, as Syndication Agent, and Bank of America,
NT & SA, as Documentation Agent, without giving effect to any waiver, amendment,
modification or replacement of such 364-Day Credit Agreement or any term or
provision thereof occurring subsequent to (or otherwise not reflected in) the
copy thereof most recently delivered to the Lender prior to the date of this
Agreement, except to the extent otherwise specifically provided in Section 7
hereof.
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1.3. Existing Guaranty Agreement
"Existing Guaranty Agreement" shall mean that certain 364-Day Guaranty
Agreement dated as of December 23, 1997 among the Guarantors and Bank of
America, N.A., as agent.
1.4. Incorporated Definitions
The defined terms contained in Article I of the Existing Credit
Agreement (hereinafter referred to collectively as the "Incorporated
Definitions") which are used in other Incorporated Definitions, the Incorporated
Loan Provisions, the Incorporated Representations and Warranties, the
Incorporated Covenants, the Incorporated Events of Default, the Incorporated
Guaranty and the Incorporated Miscellaneous Provisions (all as defined below,
including the Incorporated Definitions, being collectively referred to herein as
the "Incorporated Terms") are hereby incorporated by reference into this
Agreement to the same extent and with the same effect as if set forth fully
herein; provided, however, that, as used in this Agreement (including the
Incorporated Terms), the following terms have the meanings set forth below:
(i) All references to the Administrative Agent, the Lenders and
the Required Lenders in the Incorporated Terms shall be
deemed to be references to the Lender.
(ii) All references in the Existing Credit Agreement to the
Applicable Margin shall be deemed to be references to the
Applicable Margin as defined in Section 1.1 hereof.
(iii) All references to Loans and Revolving Loans shall be deemed
to be references to advances under the Revolving Credit Loan
as defined herein.
(iv) All references to the "Prime Rate" shall be deemed to be
references to the rate announced from time to time by the
Lender as its "base" or "prime" rate of interest (it being
understood that such rate is solely for reference and may
not be the lowest rate charged by the Lender to its
customers).
(v) All references to Default and Event of Default shall be
modified as provided in Section 5 hereof.
(vi) All references to the Commitments shall be deemed to be
references to the Commitment.
(vii) All references to the "Maturity Date" shall mean November
22, 2000, as the same may be extended with the written
consent of the Lender.
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2. LOANS
2.1. Revolving Credit Loan
Subject to the terms and conditions hereof, during the period
beginning on the date hereof (the "Facility Closing Date") and ending on the
Revolving Period Termination Date, as the same may be extended pursuant to the
Incorporated Loan Provisions (as hereinafter defined), Lender shall make
advances (all such advances, collectively, the "Revolving Credit Loan") to
Borrowers in such amounts as Borrowers shall request from time to time, provided
that the maximum aggregate outstanding principal amount of the Revolving Credit
Loan shall at no time exceed $15,000,000 (the "Commitment"). Each such advance
hereunder may consist of Base Rate Loans or Eurodollar Loans (or a combination
thereof), as Borrowers may request. Each such advance shall be made upon
written or e-mail notice of Borrowers received by the Lender not later than 1:00
PM Eastern Time three (3) Business Days prior to the date of the proposed
advance, and the amount of such proposed advance shall not be in an amount of
less than $100,000. Each such notice shall specify whether such advance shall
consist of Base Rate Loans, Eurodollar Loans or a combination thereof, and for
each Eurodollar Loan that is requested, the Interest Period with respect
thereto. Borrowers may borrow, repay and reborrow, subject to the limitations
set forth above. The aggregate outstanding principal amount of the Revolving
Credit Loan as of the Revolving Period Termination Date, together with all
accrued and unpaid interest thereon, shall be due and payable in full on the
earlier of (i) 364 days following the Revolving Period Termination Date, as the
same may have been extended as aforesaid, and (ii) the Maturity Date; provided,
however, that under no circumstances (including without limitation one or more
extensions of the Revolving Period Termination Date pursuant to the Incorporated
Loan Provisions referred to in Section 2.2 below) shall the Maturity Date be
later than December 23, 2002.
2.2. Interest, Extension of Term and Additional Provisions
Reference is made to the provisions contained in Sections 2.01(d) and
2.01(e), Sections 3.03 through 3.07, Section 3.09 and Sections 4.04 through 4.06
of the Existing Credit Agreement (hereinafter referred to as the "Incorporated
Loan Provisions"). The Incorporated Loan Provisions are hereby incorporated by
reference into this Agreement to the same extent and with the same effect as if
set forth fully herein and shall inure to the benefit of Lender; provided,
however, that (a) the references to the Closing Date (within the definition of
Revolving Period Termination Date referenced in Section 2.01(e) and as used in
Section 3.09(g) of the Existing Credit Agreement) shall be deemed to be
references to the Facility Closing Date; (b) the reference to the Credit
Documents (within the definition of Credit Obligations) shall be deemed to be a
reference to the Loan Documents hereunder;
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and (c) the reference to "this Agreement" in Section 3.09(a) of the Existing
Credit Agreement shall be deemed to be a reference to this Agreement.
2.3. Facility Fee
In consideration of the Commitment, Borrowers agree to pay to Lender a
facility fee (the "Facility Fee"): (a) for the period from the Facility Closing
Date to the Revolving Period Termination Date, on the aggregate Commitment, and
(b) for the period from the Revolving Period Termination Date to the Maturity
Date (as defined in the Existing Credit Agreement), on the aggregate Revolving
Credit Loan outstanding, computed at a per annum rate equal to the Applicable
Margin for each day during the applicable period. The Facility Fee shall be
payable quarterly in arrears on the fifteenth (15/th/) day of each January,
April, July and October and on the Maturity Date for the immediately preceding
fiscal quarter (or portion thereof).
3. REPRESENTATIONS, WARRANTIES AND COVENANTS OF BORROWERS
Reference is made to the Existing Credit Agreement and the
representations and warranties of Borrowers contained in Article IX of the
Existing Credit Agreement (hereinafter referred to as the "Incorporated
Representations and Warranties") and the covenants contained in Articles VI, VII
and VIII of the Existing Credit Agreement (hereinafter referred to as the
"Incorporated Covenants"). The Incorporated Representations and Warranties and
the Incorporated Covenants are hereby incorporated by reference into this
Agreement to the same extent and with the same effect as if set forth fully
herein and shall inure to the benefit of Lender; provided, however, that the
reference to "this Agreement" and the Credit Documents in Articles VI and VII
and in the definition of Material Adverse Effect in the Existing Credit
Agreement shall be deemed to be references to this Agreement and the Loan
Documents, respectively.
4. CONDITIONS PRECEDENT
The obligation of Lender to make any advance of the Revolving Credit
Loan is subject to the satisfaction (in the reasonable judgment of Lender), at
or before the date of such advance, of the following conditions precedent:
4.1. Representations and Warranties; Compliance
All representations and warranties made by Borrowers in this Agreement
or any of the other Loan Documents and by the Guarantors in the Incorporated
Guaranty shall be true and correct in all material respects on and as of the
date of such advance with the same force and effect as though such
representations and warranties had been made on and as of the date of such
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advance. All of the agreements, terms, covenants, and conditions required by
this Agreement to be complied with and performed by Borrowers prior to the date
of such advance shall have been complied with and performed. No Default or Event
of Default shall exist and be continuing either prior to or immediately after
giving effect to such advance.
4.2. Documents
With respect to the first such advance only, Borrowers shall deliver
to Lender copies of all documents and other items reasonably requested by Lender
evidencing Borrowers' and the Guarantors' authority to enter into and perform
this Agreement and the other Loan Documents.
4.3. Executed Loan Documents
With respect to the first such advance only, Borrowers shall deliver
to Lender fully executed copies of all the Loan Documents.
5. EVENTS OF DEFAULT AND REMEDIES
Reference is made to the Existing Credit Agreement and the events of
default and remedies set forth in Article X of the Existing Credit Agreement
(hereinafter referred to as the "Incorporated Events of Default"). The
Incorporated Events of Default are hereby incorporated by reference into this
Agreement to the same extent and with the same effect as if set forth fully
herein and shall inure to the benefit of Lender; provided, however, that all
references to "this Agreement" or the "Guaranty Agreement" in Article X of the
Existing Credit Agreement shall be deemed to be references to this Agreement,
including Incorporated Terms, and the Incorporated Guaranty, respectively. In
addition to the Events of Default incorporated by reference, the occurrence of
any Event of Default under the Existing Credit Agreement shall constitute an
Event of Default under this Agreement and the Incorporated Terms.
6. GUARANTY
Reference is made to the Existing Guaranty Agreement and the
agreements of the Guarantors contained in Section 1 through Section 11 and
Section 13 through Section 21 of the Existing Guaranty Agreement (hereinafter
referred to as the "Incorporated Guaranty"). The Incorporated Guaranty is
hereby incorporated by reference into this Agreement to the same extent and with
the same effect as if set forth fully herein and shall inure to the benefit of
Lender; provided, however, that (a) the references to the Credit Agreement, the
Credit Documents and to "this Guaranty Agreement" thereunder shall be deemed to
be references to this Agreement, the Loan Documents and this Section 6,
respectively
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(except that any cross-references in the Existing Guaranty Agreement to Sections
and definitions in the Existing Credit Agreement shall not be modified by the
foregoing proviso), (b) the notice address set forth in Section 17(a) of the
Existing Guaranty Agreement shall be deemed to be 0000 Xxxxxxxx Xxxxx Xxxxx,
Xxxxxxxx, Xxxxxxxx 00000, Attention of Vice President -Finance and Controller
(Facsimile No. 410-309-6296), and (c) the notice address set forth in Section
17(b) of the Existing Guaranty Agreement shall be deemed to be Xxxxx Fargo Bank,
National Association, Sixth & Marquette, MAC-N9305-031, Xxxxxxxxxxx, Xxxxxxxxx
00000, Attention of Xxxxx Xxxxxxx, Vice President/Sr. Banker (Facsimile No. 612-
667-2276).
7. MISCELLANEOUS PROVISIONS
Reference is made to the Existing Credit Agreement and the
miscellaneous provisions contained in Article XII of the Existing Credit
Agreement (hereinafter referred to as the "Incorporated Miscellaneous
Provisions"). The Incorporated Miscellaneous Provisions (and all other relevant
provisions of the Existing Credit Agreement related thereto) are hereby
incorporated by reference into this Agreement to the same extent and with the
same effect as if set forth fully herein and shall inure to the benefit of
Lender; provided, however, that the notice address set forth in Section 12.01(a)
of the Existing Credit Agreement shall be deemed to be 0000 Xxxxxxxx Xxxxx
Xxxxx, Xxxxxxxx, Xxxxxxxx 00000, Attention of Vice President - Finance and
Controller (Facsimile No. 410-309-6296) and provided, further, that the notice
address set forth in Section 12.01(b) of the Existing Credit Agreement shall be
deemed to be Xxxxx Fargo Bank, National Association, Sixth & Marquette, MAC-
N9305-031, Xxxxxxxxxxx, Xxxxxxxxx 00000, Attention of Xxxxx Xxxxxxx, Vice
President/Sr. Banker (Facsimile No. 612-667-2276).
In the event a waiver is granted under the Existing Credit Agreement
or the existing Guaranty Agreement or an amendment or modification is executed
with respect to the Existing Credit Agreement or the Existing Guaranty
Agreement, and such waiver, amendment and/or modification affects the
Incorporated Terms, then such waiver, amendment or modification shall be
effective with respect to the Incorporated Terms as incorporated by reference
into this Agreement only if consented to in writing by Lender. In the event of
any replacement of the Existing Credit Agreement or the Existing Guaranty
Agreement with a similar credit facility or guaranty agreement, as applicable
(in either case, the "New Facility"), the provisions contained in the New
Facility which correspond to the Incorporated Terms shall be deemed to be the
"Incorporated Terms" hereunder only if consented to in writing by Lender and, if
such consent is not granted or if the Existing Credit Agreement or the Existing
Guaranty Agreement is terminated and not replaced, then the definitions,
representations and warranties, covenants, events of default and miscellaneous
provisions contained in Articles I, IX, VI, VII, VIII, X and XII, the loan
provisions contained in Sections 2.01(d) and 2.01(e), Sections 3.03 through
3.07, Section 3.09 and Sections 4.04 through 4.06 of the Existing Credit
Agreement,
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and the guaranty provisions contained in Section 1 through Section 11 and
Section 13 through Section 21 of the Existing Guaranty Agreement (together with
any waivers, modifications or amendments approved in accordance with this
Section 7) shall continue to be the Incorporated Terms hereunder.
In the event of a conflict between any of the Incorporated Terms and
the terms of this Agreement set forth at length herein, the terms set forth
herein shall govern.
IN WITNESS WHEREOF, the undersigned have duly executed this Agreement,
or have caused this Agreement to be duly executed on their behalf, as of the day
and year first hereinabove set forth.
BORROWERS:
U.S. FOODSERVICE, INC.
By: /s/ Xxxxxx Xxxxxxxx
--------------------
Name: Xxxxxx Xxxxxxxx
Title: Treasurer
JP FOODSERVICE DISTRIBUTORS, INC.
By: /s/ Xxxxxx Xxxxxxxx
--------------------
Name: Xxxxxx Xxxxxxxx
Title: Treasurer
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GUARANTORS:
U.S. FOODSERVICE
By: /s/ Xxxxxx Xxxxxxxx
--------------------
Name: Xxxxxx Xxxxxxxx
Title: Treasurer
XXXXXXXXXXXX SALES CO. LIMITED
PARTNERSHIP
By: USF/Xxxxxxxxxxxx Sales GP
Holdings, LLC
By: /s/ Xxxxxx Xxxxxxxx
--------------------
Name: Xxxxxx Xxxxxxxx
Title: Treasurer
SUPERIOR PRODUCTS MFG. CO.
LIMITED PARTNERSHIP
By: USF/Superior Products GP
Holdings, LLC
By: /s/ Xxxxxx Xxxxxxxx
--------------------
Name: Xxxxxx Xxxxxxxx
Title: Treasurer
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E&H DISTRIBUTING CO.
XXXXXXXX'X PRIME MEATS &
PROVISIONS, INC.
ILLINOIS FRUIT & PRODUCE CORP.
TRANS-PORTE, INC.
EL PASADO, INC.
RITUALS COFFEE COMPANY
ROSELI PRODUCTS CORPORATION
XXXXXX FOOD SERVICE, INC.
NEVADA BAKING COMPANY, INC.
OUTWEST MEAT COMPANY
HILLTOP HEARTH BAKERIES, INC.
CROSS VALLEY FARMS, INC.
XXXXXXX BROTHERS, INC.
BRB HOLDINGS, INC.
X.X. XXXXXXXX & COMPANY, INC.
FOOD DISTRIBUTION CONCEPTS, INC.
XXXX XXXXXX & CO.
KING'S FOODSERVICE, INC.
ROANOKE RESTAURANT SERVICE, INC.
TARGETED SPECIALTY SERVICES, INC.
U.S. FOODSERVICE OF ATLANTA, INC.
U.S. FOODSERVICE OF ILLINOIS, INC.
U.S. SYSTEMS DISTRIBUTION, INC.
WHITE SWAN, INC.
X.X. XXXX & SONS, L.L.C.
U.S. FOODSERVICE OF BUFFALO, INC.
SOUTHTOWNS SEAFOOD, INC.
SOFCO, INC.
S.&O. PROPERTY CORPORATION
SQP, INC.
USF/XXXXXXXXXXXX SALES GP
HOLDINGS, LLC
USF/XXXXXXXXXXXX SALES LP
HOLDINGS, LLC
NEXT DAY GOURMET, INC.
USF/SUPERIOR PRODUCTS GP
HOLDINGS, LLC
USF/SUPERIOR PRODUCTS LP
HOLDINGS, LLC
XXXXXX XXXX FOODS, INC.
PACIFIC JADE, INC.
By: /s/ Xxxxxx Xxxxxxxx
--------------------
Name: Xxxxxx Xxxxxxxx
Title: Treasurer
for each of the foregoing
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LENDER:
XXXXX FARGO BANK, NATIONAL ASSOCIATION
By: /s/ Xxxxx X. Xxxxxxx
----------------------
Name: Xxxxx X. Xxxxxxx
Title: Vice President
By: /s/ Xxxx X. Xxxxxxxxxx
------------------------
Name: Xxxx X. Xxxxxxxxxx
Title: Officer
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