EXHIBIT 10.24
AMENDMENT NO. 2 TO LOAN AND SECURITY AGREEMENT
This AMENDMENT NO. 2 TO LOAN AND SECURITY AGREEMENT (this "Amendment")
dated as of April 1, 1998 by and between Congress Financial Corporation
(Central)("Lender") and Eagle Food Centers, Inc. ("Borrower").
R E C I T A L S:
WHEREAS, Lender and Borrower are parties to that certain Loan and
Security Agreement dated as of May 25, 1995; as the same has been amended, (the
"Loan Agreement"; capitalized terms used and not defined herein shall have the
meanings assigned to them in the Loan Agreement as amended hereby);
WHEREAS, the Borrower has requested that Lender consent to a second
amendment to the Loan agreement as more fully described herein; and
WHEREAS, Lender has granted its consent to such amendment upon the
terms and conditions contained herein.
NOW, THEREFORE, in consideration of the premises contained herein, and
for other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the parties hereto hereby agree as follows:
Section 1. Amendment. Immediately upon the satisfaction of each of the
conditions precedent set forth in Section 2 of this Amendment:
1.1. Section 1.28 of the Loan Agreement is amended by (i) replacing the
language "a rate of one percent (1%)" in the first clause (a) of such section
with "a rate of, from and after March 1, 1998, one half percent (0.50%)" and
(ii) replacing the language "a rate of three and one half percent (3.50%)" in
the first clause (b) of such section with "a rate of, from and after March 1,
1998, two and one quarter percent (2.25%)".
1.2. Section 3.2 of the Loan Agreement is amended by replacing the
dollar amount of "$7,500" stated therein with the dollar amount of "$5000".
1.3. Section 6.3(b) of the Loan Agreement is amended by amending and
restating the first sentence of such section in its entirety as follows: "For
purposes of calculating interest on the Obligations, such payments or other
funds received will be applied (conditional upon final collection) to the
Obligations on the date of receipt of immediately available funds by Lender in
the Payment Account."
1.4. Section 7.2 of the Loan Agreement is amended by amending and
restating clause (d) of such section in its entirety as follows: "(d) upon
Lender's request, Borrower shall, at its expense, no more than once in any
twelve (12) month period, but at any time or times as Lender may request (i) on
or after an Event of Default has occurred and is continuing or (ii) on or after
a date in which the amount available under the lending formula set forth in
Section 2.1(a) hereof exceeds the outstanding Loans and Letter of Credit
Accommodations by less than
$10,000,000, deliver or cause to be delivered to Lender written reports or
appraisals as to the Inventory, prepared in form, scope and methodology
(including, without limitation, on a "going out of business" basis) acceptable
to Lender and by an appraiser acceptable to Lender, addressed to Lender or upon
which Lender is expressly permitted to rely; provided that Borrower may request
such a report or appraisal at any time or times as Borrower may desire for the
purpose of inducing Lender to modify the Inventory Advance Rate;"
1.5. Section 9.8 of the Loan Agreement is amended by replacing the dollar
amount of "$10,000,000" which appears in clause (e) therein with the dollar
amount "$50,000,000".
1.6. Section 9.13 of the Loan Agreement is amended by (i) replacing the
dollar amount of "$10,000,000" set forth opposite the period designated as
"Borrower's fiscal year 1998" in such section with the amount of "$75,000,000"
and (ii) adding the following at the end of the categories designated as
"Period" and "Maximum Amount":
"Borrower's fiscal year 1999 $75,000,000 or such greater amount as
agreed to by Lender in writing prior to
the first day of such fiscal year
Borrower's fiscal year 2000 $75,000,000 or such greater amount as
agreed to by Lender in writing prior to
the first day of such fiscal year"
1.7. Section 12.1(a) of the Loan Agreement is amended by (i) replacing the
language "the date three (3) years from the date hereof" in the first sentence
of such section with "April 15, 2000" and (ii) replacing the dollar amount of
"$100,000" appearing in the second sentence of such section with "$50,000".
Section 2. Conditions to Effectiveness of Amendment. This Amendment shall be
effective as of the date first above written and the following conditions
precedent shall have been satisfied at or prior to such date;
2.1. Documents.
(a) Amendment. The Lender shall have received a duly executed
counterpart of this Amendment from Borrower.
(b) Participation of Loan Agreement Consents. Each Person which has
acquired a participation interest in any or all of Lender's rights under the
Loan Agreement shall have executed and delivered to Lender an Acknowledgment and
Consent, in form and substance satisfactory to Lender, with respect to the
applicable participation agreement.
2.2. Certified Resolutions, etc. Lender shall have received a
certificate, in form and substance satisfactory to the Lender, of the secretary
or assistant secretary of the Borrower dated the effective date of this
Amendment (the "Effective Date"), certifying (i) the resolutions of its Board of
Directors approving and authorizing the execution, delivery and performance by
it of
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this Amendment and the continued effectiveness thereof, (ii) that there have
been no changes in its certificate of incorporation or by-laws since May 25,
1995, or if there have been changes in its certificate of incorporation or
by-laws since May 25, 1995, certifying its certificate of incorporation and/or
by-laws, as the case may be, as in effect on the Effective Date and (iii)
specimen signatures of its officers authorized to sign this Amendment.
2.3. Consents, Licenses, Approval, etc. All consents, licenses and
approvals, if any, required in connection with the execution, delivery and
performance by the Borrower of this Amendment or the Loan Agreement, as amended
by this Amendment, or the validity or enforceability thereof, or in connection
with any of the transactions effected pursuant to this Amendment or the Loan
Agreement, as amended by this Amendment, shall be in full force and effect.
2.4. No Injunction. No law or regulation shall have been adopted, no
order, judgment or decree of any governmental authority shall have been issued,
and no litigation shall be pending or threatened, which in the reasonable
judgment of Lender would enjoin, prohibit or restrain, or impose or result in
the imposition of any material adverse condition upon, the execution, delivery
or performance by the borrower of this Amendment or the Loan Agreement, as
amended by this amendment.
Section 3. Representations and Warranties. In order to induce Lender to enter
into this Amendment, Borrower represents and warrants to Lender, upon the
effectiveness of this Amendment, which representations and warranties shall
survive the execution and delivery of this amendment that:
3.1. No Default; etc. No Event of Default and no event or condition
which, merely with notice or the passage of time or both, would constitute an
Event of Default, has occurred and is continuing after giving effect to this
Amendment or would result from the execution or delivery of this Amendment or
the consummation of the transactions contemplated hereby.
3.2. Corporate Power and Authority; Authorization. Borrower has the
corporate power and authority to execute and deliver this Amendment and to carry
out the terms and provisions of the Loan Agreement, as amended by this
Amendment, and the execution and delivery by Borrower of this Amendment and the
Loan Agreement, as amended by this Amendment, and the performance by the
Borrower of its obligations hereunder and thereunder have been duly authorized
by all requisite corporate action by Borrower.
3.3. Execution and Delivery. Borrower has duly executed and delivered
this Amendment.
3.4. Enforceability. This Amendment and the Loan Agreement, as amended by
this Amendment, constitute the legal, valid and binding obligations of Borrower,
enforceable against Borrower in accordance with their respective terms, except
as enforcement may be limited by bankruptcy, insolvency, reorganization,
moratorium or similar laws affecting the enforcement of creditors' right
generally, and by general principles of equity.
3.5. Representations and Warranties. All of the representations and
warranties
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contained in the Loan Agreement and in the other Financing Agreements (other
than those which speak expressly only as of a different date) are true and
correct as of the date hereof after giving effect to this Amendment and the
transactions contemplated hereby.
Section 4. Miscellaneous.
4.1. Effect; Ratification. The amendments set forth herein are effective
solely for the purposes set forth herein and shall be limited precisely as
written, and shall not be deemed to (i) be a consent to any amendment, waiver or
modification of any other term or condition of the Loan Agreement or of any
other Financing Agreement or (ii) prejudice any right or rights that Lender may
now have or may have in the future under or in connection with the Loan
Agreement or any other financing Agreement. Each reference in the Loan Agreement
to "this Agreement", "herein", "hereof" and words of like import and each
reference in the other Financing Agreements to the "Loan Agreement" shall mean
the Loan Agreement as amended hereby. This Amendment shall be construed in
connection with and as part of the Loan Agreement and all terms, conditions,
representations, warranties, covenants and agreements set forth in the Loan
Agreement and each other Financing Agreement, except as herein amended or
waived, are hereby ratified and confirmed and shall remain in full force and
effect.
4.2. Counterparts. This Amendment may be executed in any number of
counterparts, each such counterpart constituting an original but all together
one and the same instrument.
4.3. Governing Law. This Amendment shall be governed by, and construed
and interpreted in accordance with, the internal laws of the State of Illinois.
[Signature page follows]
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IN WITNESS WHEREOF, the parties hereto have executed this Amendment
as of the date first above written.
CONGRESS FINANCIAL CORPORATION
(CENTRAL)
By: /s/ Xxxxxx Linckrman
--------------------------------
Name: Xxxxxx Linckrman
Title: Vice President
EAGLE FOOD CENTERS, INC.
By: /s/ Xxxxxx Xxxxxxx
--------------------------------
Name: Xxxxxx Xxxxxxx
Title: Secretary
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