EXHIBIT 10.1
LOAN AGREEMENT
THIS LOAN AGREEMENT (this "Agreement") is entered into as of
November 24, 1999 among U.S. Foodservice, Inc., a Delaware corporation, and JP
Foodservice Distributors, Inc., a Delaware corporation (collectively, the
"Borrowers"), U.S. Foodservice, a Delaware corporation (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 Wachovia Bank, N.A.
("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 than
II 4.0 to 1.0 but greater 112.5 bps 25.0 bps
than 3.5 to 1.0
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I Equal to or less than 102.5 bps 25.0 bps
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, Banc of America Securities 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.
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.
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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 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, collectively, 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 all references to the Administrative Agent and the Lenders in the
Incorporated Terms shall be deemed to be references to Lender.
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 $25,000,000 (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.
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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 3.09 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, without giving
effect to any waiver, amendment, modification or replacement of the Existing
Credit Agreement or any term or provision thereof occurring subsequent to the
date of this Agreement, except to the extent otherwise specifically provided in
Section 7 hereof; provided, however, that (a) 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; (b) 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; (c) the references to Loans and Revolving Loans in the Existing Credit
Agreement shall be deemed to be references to the Revolving Credit Loan as
defined herein; (d) the Prime Rate shall be Lender's prime rate in effect at its
principal office; (e) the reference to the Credit Documents (within the
definition of Credit Obligations) shall be deemed to be a reference to the Loan
Documents hereunder; and (f) 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
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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, without giving effect to any waiver,
amendment, modification or replacement of the Existing Credit Agreement or any
term or provision thereof occurring subsequent to the date of this Agreement,
except to the extent otherwise specifically provided in Section 7 hereof;
provided, however, that (a) 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, and (b) the references to
Default and Event of Default shall be modified as provided in Section 5 hereof.
4. CONDITIONS PRECEDENT
4.1. Conditions Precedent to First Advance of the Revolving Credit Loan on
or after the Date Hereof
The obligation of Lender to make the first advance of the Revolving
Credit Loan on or after the date hereof is subject to the satisfaction (in the
reasonable judgment of Lender), at or before the date of such advance, of the
following conditions precedent:
4.1.1. 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
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.
4.1.2. Documents
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.
4.1.3. Executed Loan Documents
Borrowers shall deliver to Lender fully executed copies of all the
Loan Documents.
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4.2. Conditions Precedent to the Second and Each Subsequent Advance of the
Revolving Credit Loan
The obligation of Lender to make the second and each subsequent
advance of the Revolving Credit Loan is subject to the satisfaction (in the
reasonable judgment of Lender), as of the date of each such advance, of the
conditions precedent specified in Section 4.1.1 hereof.
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, without giving effect to any
waiver, amendment, modification or replacement of the Existing Credit Agreement
or any term or provision thereof occurring subsequent to the date of this
Agreement, except to the extent otherwise specifically provided in Section 7
hereof; provided, however, that all references to "Loans," "this Agreement" or
the "Guaranty Agreement" in Article X of the Existing Credit Agreement shall be
deemed to be references to the Revolving Credit Loan, this Agreement and the
Incorporated Guaranty, respectively.
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, without giving effect to any waiver, amendment, modification or
replacement of the Existing Guaranty Agreement or any term or provision thereof
occurring subsequent to the date of this Agreement, except to the extent
otherwise specifically provided in Section 7 hereof; provided, however, that (a)
the references to the Credit Agreement, the Credit Documents, the Loan, the
Commitments and to "this Guaranty Agreement" thereunder shall be deemed to be
references to this Agreement, the Loan Documents, the Revolving Credit Loan, the
Commitment and this Section 6, respectively (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
Treasurer
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(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 Wachovia Bank,
N.A., 000 Xxxxxxxxx Xxxxxx, X.X., Xxxxxxx, Xxxxxxx 00000, Attention of Vice
President (Facsimile No. 404-332-6898).
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, without giving effect to any waiver, amendment, modification or
replacement of the Existing Credit Agreement or any term or provision thereof
occurring subsequent to the date of this Agreement, except to the extent
otherwise specifically provided in the following provisions of this Section 7;
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 Treasurer (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 Wachovia Bank, N.A., 000
Xxxxxxxxx Xxxxxx, X.X., Xxxxxxx, Xxxxxxx 00000, Attention of Vice President
(Facsimile No. 404-332-6898).
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 3.09
and Sections 4.04 through 4.06 of the Existing Credit Agreement, and the
guaranty provisions contained in Sections 1 through Section 11 and Section 13
through Section 21 of the Existing Guaranty Agreement (together with any
waivers,
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modifications or amendments approved in accordance with this Section 7) shall
continue to be the Incorporated Terms hereunder.
The Borrowers and Guarantors hereby represent and warrant to the
Lender that they have (i) initiated a review and assessment of their respective
businesses and operations that could be adversely affected by the risk that
computer applications used by the Borrowers and the Guarantors may be unable to
recognize and perform properly date sensitive functions involving certain dates
prior to and any date after December 31, 1999 (the "Year 2000 Problem"), (ii)
developed contingency plans for addressing the Year 2000 Problem and (iii) made
inquiry regarding the ability of their principal suppliers and customers to
address the Year 2000 Problem. The Borrowers and the Guarantors are taking what
they consider to be reasonable steps to prevent major interruptions in their
respective businesses and operations due to the Year 2000 Problem, which steps
are expected to minimize but not eliminate the risk of the Year 2000 Problem.
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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
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:
WACHOVIA BANK, N.A.
By: /s/ Xxxxxxxx X. Xxxxxxx
--------------------------
Name: Xxxxxxxx X. Xxxxxxx
Title: Vice President
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