AMENDMENT NO. 1
TO
SECOND AMENDED AND RESTATED CREDIT AND TERM LOAN AGREEMENT
THIS AMENDMENT NO. 1 (this "First Amendment") is entered into as of May
11, 2001, by and among NEW LINDEN PRICE RITE, INC., a New Jersey corporation
("New Linden"), FOODARAMA SUPERMARKETS, INC., a New Jersey corporation
("Parent") (New Linden and Parent, each a "Borrower" and collectively
"Borrowers"), the Guarantors signatory hereto, the lenders set forth on the
signature pages hereto (collectively with their respective permitted successors
and assigns, each a "Lender" and collectively, "Lenders") and GMAC BUSINESS
CREDIT, LLC as agent for Lenders (in such capacity together with any successor
thereto in such capacity, the "Agent").
BACKGROUND
Borrowers, Guarantors, Agent and Lenders are parties to a Second Amended
and Restated Revolving Credit and Term Loan Agreement dated as of January 7,
2000 (as amended, restated, supplemented or otherwise modified from time to
time, the "Loan Agreement") pursuant to which Agent and Lenders provide
Borrowers with certain financial accommodations.
Borrowers have requested that Agent and Lenders make certain amendments to
the Loan Agreement, and Agent and Lenders are willing to do so on the terms and
conditions hereafter set forth.
NOW, THEREFORE, in consideration of any loan or advance or grant of credit
heretofore or hereafter made to or for the account of Borrowers by Agent and
Lenders, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto hereby agree as
follows:
1. Definitions. All capitalized terms not otherwise defined herein shall
have the meanings given to them in the Loan Agreement.
2. Amendment to Loan Agreement. Subject to satisfaction of the conditions
precedent set forth in Section 3 below, the Loan Agreement is hereby amended as
follows:
(a) Section I is amended as follows:
(i) the following defined terms are added in their
appropriate alphabetical order:
"First Amendment" shall mean Amendment No. 1 to Second
Amended and Restated Credit and Term Loan Agreement dated as
of May 11, 2001 by and among the Borrowers, Guarantors,
Agent and Lenders.
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"First Amendment Effective Date" shall mean the date on which
all conditions precedent set forth in the First Amendment
shall have been satisfied.
(ii) each of the following defined terms is amended in its
entirety to provide as follows:
"Change of Control" shall mean (i) Xxxxxx Xxxxx, Xxxxxx Xxxxx,
Xxxxxxx Xxxxx and Permitted Family Transferees shall together
fail to own, beneficially and control all voting rights with
respect to, at least 35% of all of the issued and outstanding
capital common stock of the Parent or (ii) Xxxxxx Xxxxx,
Xxxxxx Xxxxx, Xxxxxxx Xxxxx, Xxxxxx X. Xxxxx, Xx. and Xxxxxx
Xxxxx shall together fail to own, beneficially and all voting
rights with respect to, at least 30% of all of the issued and
outstanding capital common stock of the Parent (provided,
however that the 30% requirement set forth in this clause (ii)
shall be reduced by 1% each year (e.g., from 30% to 29% and
from 29% to 28%, etc.) effective on each anniversary date of
the Closing Date, but in no event to lower than 25%.
"EBITDA" shall mean, for any period, Net Income plus, (X) to
the extent included in the calculation of Net Income, the sum
of (i) any extraordinary non-cash losses, (ii) the amount of
any reserves taken and occasioned by the closing of store
locations, (iii) non-cash charges for assets written down as a
result of store remodels and/or closedowns, (iv) interest
expenses net of interest income, (v) depreciation and
amortization, (vi) federal, state and local income taxes and
(vii) any increase in the LIFO reserve and less (Y) the sum of
(i) any extraordinary non-cash gains included in the
calculation of Net Income, (ii) any extraordinary cash gains
included in the calculation of Net Income, but only to the
extent such gains exceed extraordinary cash losses included in
the calculation of Net Income and (iii) any charges to balance
sheet reserves previously or presently established in
connection with the closing of store locations or the
disposition of other assets in each case of the Parent and its
Subsidiaries for such period determined on a Consolidated
basis, computed and calculated in accordance with generally
accepted accounting principles, and (iv) any decrease in the
LIFO reserve.
"Permitted Family Transferees" means (a) each member of the
Saker Group, (b) any trust established by one or more Saker
Persons, the beneficiaries of which are solely one or more
members of the Saker Group, (c) any partnership owned solely
by one or more members of the Saker Group or owned solely by
one or more entities which are either owned solely by one or
more members of the Saker Group or of which solely one or more
members of the Saker Group are beneficiaries, or (d) any
estate of which solely one or more members of the Saker Group
are beneficiaries.
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"Related Family Transferee" means (a) any Saker Person
(excluding Xxxxxxx Xxxxx, Xxxxxx Xxxxx, Xxxxxx Xxxxx, Xxxxxx
Xxxxx or Xxxxxx Xxxxx, Xx.); (b) any trust established solely
or jointly by any Saker Person, the beneficiaries of which
include any Saker Person; (c) any partnership owned in whole
or in part by any Saker Person or owned in whole or in part by
one or more entities which are either owned in whole or in
part by any Saker Person or of which any Saker Person is a
beneficiary or (d) any estate of which any Saker Person is a
beneficiary.
"Responsible Officer" shall mean, with respect to any person,
any senior vice president, executive vice president,
president, chief financial officer or chief accounting
officer, of such person.
"Saker Group" shall mean each spouse, sibling, child or
grandchild of Xxxxxxx Xxxxx, Xxxxxx Xxxxx, Xxxxxx Xxxxx,
Xxxxxx Xxxxx or Xxxxxx Xxxxx, Xx.
"Saker Person" means any (a) of Xxxxxxx Xxxxx, Xxxxxx Xxxxx,
Xxxxxx Xxxxx, Xxxxxx Xxxxx and/or Xxxxxx Xxxxx, Xx.; and/or
(b) member of the Saker Group.
"Total Revolving Commitment" shall mean the lesser of (i)
$28,000,000 and (ii) the sum of the Lenders' Revolving
Commitments.
(b)The first three sentences of Section 2.01(d) of the Loan Agreement
are hereby amended in their entirety to read as follows:
"Capital Expenditure Loans shall be available at all times
from the Second Amendment and Restatement Date through and
excluding the earlier of (i) the Termination Date and (ii)
June 30, 2002 (the "Capital Expenditure Facility Availability
Period"). At December 31, 2001, the sum of the principal
amount of all Capital Expenditure Loans made through December
31, 2001 will be amortized on the basis of a twenty-eight (28)
quarter amortization schedule, commencing on April 1, 2002. At
the end of such Capital Expenditure Facility Availability
Period, the sum of the principal amount of all Capital
Expenditure Loans made between January 1, 2002 and the end of
such Capital Expenditure Facility Availability Period will be
amortized on the basis of a twenty-six (26) quarter
amortization schedule, commencing on October 1, 2002. The
Capital Expenditure Loans shall be, with respect to principal,
payable in equal quarterly installments based upon the
amortization schedules set forth above, on the first day of
each July, October, January and April subject to acceleration
upon the occurrence of an Event of Default under this
Agreement or the termination of this Agreement. In any event,
the entire principal amount of the Capital Expenditure Loans
shall be due and payable on the Final Maturity Date."
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Section 5.01A.(b)(i) of the Loan Agreement is hereby amended as
follows:
(i) the number "forty-five (45)" appearing therein is replaced
with the number "one hundred and eighty (180)".
Section 7.03 in the Loan Agreement is hereby amended in its entirety
as follows:
"SECTION 7.03. Indebtedness. Incur, create, assume or permit
to exist any Indebtedness other than (i) Indebtedness secured
by Liens permitted under Section 7.01; provided, however, that
(x) Adjusted Indebtedness shall not exceed the sum of (1)
Adjusted Indebtedness for the acquisition of equipment at a
single New/Replacement Store Project (the "Alternative Capex
Financing") incurred at any time during the Capital
Expenditure Facility Availability Period; provided, however,
that (a) the Alternative Capex Financing shall be limited to
the lesser of $4,000,000 and the unused principal amount of
the Total Capital Expenditure Facility Commitment; (b) such
Alternative Capex Financing shall be incurred pursuant to
documents reasonably satisfactory to Agent; (c) no portion of
such Alternative Capex Financing shall be guaranteed by
Wakefern; (d) the Agent shall be notified in writing prior to
the incurrence of any such Alternative Capex Financing, which
notice shall designate such borrowing as the "Alternative
Capex Financing" and indicate the date on which such borrowing
shall occur; (e) the Borrowers shall be permitted to incur
only one borrowing with the Alternative Capex Financing; and
(f) simultaneously with the incurrence of such Alternative
Capex Financing, the Total Capital Expenditure Facility
Commitment shall be immediately and permanently reduced by
$4,000,000 and (2) (a) $550,000 in new Adjusted Indebtedness
incurred during Fiscal Year 1999; (b) $1,250,000 in new
Adjusted Indebtedness incurred during Fiscal Year 2000; (c)
$250,000 in new Adjusted Indebtedness incurred during Fiscal
Year 2001; (d)$8,000,000 in new Adjusted Indebtedness incurred
during Fiscal Year 2002 (provided, however, that such
Indebtedness shall be incurred in connection with no more than
two store locations and the amount of Indebtedness incurred
with respect to each individual store shall not exceed
$4,000,000); (e) $250,000 in new Adjusted Indebtedness
incurred during Fiscal Year 2003, and (f) $250,000 in new
Adjusted Indebtedness incurred during Fiscal Year 2004, in
each case for the Parent and its Subsidiaries, and provided,
further, that to the extent the full amount of permitted
Indebtedness as set forth in clauses (a) through (f) above is
not incurred in any particular Fiscal Year, such unused amount
may be "carried over" and utilized in the immediately
succeeding Fiscal Year only (but not in any subsequent Fiscal
Year), provided, however, that any Indebtedness incurred in
such immediately succeeding Fiscal Year shall first be applied
to the reduction of the regularly scheduled amount of
permitted Indebtedness as set forth in the foregoing clauses
(a) through (f),
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as the case may be and secondly to any such
carryover amount; and provided, further, that the Adjusted
Indebtedness described in the foregoing clause (2) shall be
incurred pursuant to documents reasonably satisfactory to
Agent and (y) Indebtedness attributable to Capitalized Lease
Obligations in connection with real estate leases shall not
exceed an aggregate amount of (a) $5,865,000 in new
Indebtedness incurred during Fiscal Year 1999; (b) $21,691,000
in new Indebtedness incurred during Fiscal Year 2000; (c)
$12,000,000 in new Indebtedness incurred during Fiscal Year
2001; (d) $26,000,000 in new Indebtedness incurred during
Fiscal Year 2002; (e) $14,000,000 in new Indebtedness incurred
during Fiscal Year 2003 and (f) $0 in new Indebtedness
incurred during Fiscal Year 2004, in each case for the Parent
and its Subsidiaries and provided, further, that to the extent
the full amount of permitted Indebtedness as set forth in
clauses (a) through (f) above is not incurred in any
particular Fiscal Year, such unused amount may be "carried
over" and utilized in the immediately succeeding Fiscal Year
only (but not in any subsequent Fiscal Year), provided,
however, that any Indebtedness incurred in such immediately
succeeding Fiscal Year shall first be applied to the reduction
of the regularly scheduled amount of permitted Indebtedness as
set forth in the foregoing clauses (a) through (f), as the
case may be and secondly to any such carryover amount, (ii)
Indebtedness (including, without limitation, Guarantees)
existing on the date hereof and listed in Schedule 7.03
annexed hereto, but not the increase, extension, renewal or
refunding thereof if, pursuant to such increase, extension,
renewal or refunding, (x) the amount of the relevant
Indebtedness is increased, (y) the terms thereof and the
related interest rate do not fairly reflect market conditions
for companies in businesses and with credit standing similar
to the Parent or (z) such Indebtedness is more senior in rank
than that being so extended, renewed or refunded, (iii)
Indebtedness incurred hereunder and under the other Loan
Documents, (iv) Indebtedness of the Parent to Wakefern and
affiliates of Wakefern required to be incurred under the
Wakefern Shareholder Agreement, the Certificate of
Incorporation of Wakefern and/or the bylaws of Wakefern, (v)
Guarantees constituting the endorsement of negotiable
instruments for deposit or collection in the ordinary course
of business, (vi) Guarantees of the Obligations, (vii)
Subordinated Indebtedness, but not the increase, extension,
renewal or refunding thereof except as consented to by Agent
in writing, (viii) Indebtedness to banks with whom Borrowers
regularly bank with respect to uncollected funds in accordance
with past practices; (ix) Intercompany Indebtedness to the
extent permitted under Section 7.06 and (x) Indebtedness
relating to up to a $7 million potential construction loan in
or subsequent to Fiscal Year 2001 at the Bricktown
New/Replacement Store Project, provided that such loan be
permitted only under the condition that the loan be
outstanding no longer than 24 months, that the landlord has
permanent take-out financing in place at the time such loan is
entered into and that the terms and conditions of such
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construction loan financing, permanent take-out financing and
all lease arrangements with respect to the Bricktown
New/Replacement Store Project be in conformity in all material
respects with the terms and conditions approved by Agent in
writing prior to Borrower entering into any material
undertaking with respect to such Bricktown New/Replacement
Store Project; provided, however, that Agent agrees to make
reasonable efforts to communicate with Borrowers on a
reasonably prompt basis regarding terms and conditions that
are acceptable to Agent and/or the Lenders."
Section 7.04 of the Loan Agreement is hereby amended in its entirety
as follows:
"Section 7.04. Dividends, Distributions and Payments. Declare
or pay, directly and indirectly, any cash dividends or make
any other distribution, whether in cash, property, securities
or a combination thereof, with respect to (whether by
reduction of capital or otherwise) any shares of its capital
stock or directly or indirectly redeem, purchase, retire or
otherwise acquire for value (or permit any Subsidiary to
purchase or acquire) any shares of any class of its capital
stock or set aside any amount for any such purpose, except
that (i) any Subsidiary of the Parent may pay dividends to a
Borrower; (ii) distributions of Common Stock of the Parent may
be made to shareholders of the Parent other than Wakefern and
its Subsidiaries or affiliates; and (iii) Parent may redeem or
repurchase its common stock for an aggregate purchase price
not to exceed $5,000,000 during the term of this Agreement,
provided, however, (a) both prior to and immediately after
giving effect to such redemption or repurchase, each Borrower
and Guarantor is "solvent" as such term is used under
applicable corporate law and insolvency law and each Borrower
and Guarantor shall comply with the representations and
warranties set forth in Section 4.17 hereof; (b) Agent and
Lender shall have received evidence that the redemption or
repurchase of the Parent's common stock will not violate: (1)
any provision of law, statute, rule or regulation applicable
to any Borrower or any Guarantor (including, without
limitation Rules 10b-18 and 13e-3 under the Securities
Exchange Act of 1934) or certificate or articles of
incorporation or other applicable constitutive documents or
the by-laws of any Borrower, any Guarantor, or its
Subsidiaries, as the case may be; or (2) any order of any
court, or any rule, regulation or order of any other agency of
government binding upon any Borrower, any Guarantor, or its
Subsidiaries; (c) no Borrower or Guarantor may redeem or
repurchase any shares of any class of stock from Xxxxxx Xxxxx,
Xxxxxx Xxxxx, Xxxxxxx Xxxxx, Xxxxxx X. Xxxxx, Xx., Xxxxxx
Xxxxx or any Subsidiary of the Parent or more than 25,000
shares of all classes of stock in the aggregate from any
Related Family Transferees; and (d) Borrowers and Guarantors
shall have delivered to Agent and Lenders such information
regarding such redemption and/or repurchase as Agent shall
reasonably request. Notwithstanding the foregoing, no payment
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referred to herein may be made unless both before and
immediately after giving effect thereto, there shall exist and
be continuing no Default or Event of Default and all other
conditions and restrictions with respect to such payment under
this Agreement shall have been satisfied."
(f) Section 7.06 is hereby amended by:
(i) deleting the word "and" at the end of item "(j)" therein;
(ii) deleting the period at the end of item "(k)" thereof and
inserting a semi-colon and the word "and" therein;
(iii)inserting a new item "(l)" to read in its entirety as
follows:
"(l) loans made by a Borrower and/or Guarantor to its
employees up to a maximum of $50,000 in the aggregate
for all Borrowers and Guarantors."
(g) Section 7.10(b) in the Loan Agreement is hereby amended in its
entirety as follows:
"(b) Capital Expenditures relating to New/Replacement Store
Projects (excluding Capital Expenditures for real estate
assets acquired pursuant to Capitalized Lease Obligations,
hereinafter referred to as "Store Project Capex") in any
Fiscal Year in an aggregate amount in excess of the following
amounts for the Parent and its Subsidiaries on a Consolidated
basis:
-----------------------------------------------------------
Store Project Capex
-----------------------------------------------------------
-----------------------------------------------------------
Fiscal Year 2000 $9,303,922
-----------------------------------------------------------
-----------------------------------------------------------
Fiscal Year 2001 $13,000,000
-----------------------------------------------------------
-----------------------------------------------------------
Fiscal Year 2002 $4,500,000
-----------------------------------------------------------
-----------------------------------------------------------
Fiscal Year 2003 $11,500,000
-----------------------------------------------------------
-----------------------------------------------------------
Fiscal Year 2004 and each $0
Fiscal Year thereafter
-----------------------------------------------------------
provided, however, that to the extent the full amount of
permitted Store Project Capex is not incurred in any
particular Fiscal Year, such unused amount may be "carried
over" and utilized in the immediately succeeding Fiscal Year
only (but not in any subsequent Fiscal Year), provided,
however, that any such Store Project Capex incurred in such
immediately succeeding Fiscal Year shall first be applied to
the reduction of the amount of permitted Store Project Capex
for the fiscal year in which such Store Project Capex is made
and secondly to any such carryover amount."
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(h) Schedule 2.01 to the Loan Agreement is replaced with the
corresponding Schedule 2.01 to this First Amendment.
(i) Section 11.01(b) to the Loan Agreement is hereby amended in its
entirety as follows:
"(b) if to Agent, at GMAC Business Credit, LLC, 000 Xxxxx Xxxxxx,
00xx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Xxxxxxx Xxxxxx,
with a copy to Xxxx & Hessen LLP, 000 Xxxxx Xxxxxx, Xxx Xxxx,
Xxx Xxxx 00000, Attention: Xxxxxxx Xxx Podair, Esq.; and"
3. Conditions of Effectiveness. This First Amendment shall become
effective upon satisfaction of the following conditions precedent:
(i) Agent and Lenders shall have received in form and substance
satisfactory to Agent and Lenders five (5) copies of this First
Amendment duly executed by each Borrower and consented to by
Guarantors;
(ii) Each Lender shall have received a fully executed Fourth
Amended and Restated Revolving Note executed by Borrowers in
favor of Agent;
(iii) the executed opinion of counsel from Xxxxxxxx, Xxxxxxxx &
Xxxxxx in form and substance satisfactory to Agent and Lenders,
which shall cover such matters incident to the transaction
contemplated by this First Amendment as Agent and Lenders may
request; and
(iv) A certificate of the Secretary of the Borrowers and the
Guarantors, including the charter and by-laws of the Borrowers
and Guarantors and copies of the resolutions authorizing the
execution, deliver and performance of this First Amendment, in
each instance in form and substance satisfactory to Agent and
Lenders.
4. Representations and Warranties. Each Borrower and Guarantor hereby
represents and warrants as follows:
(a) This First Amendment and the Loan Agreement, as amended hereby,
constitute legal, valid and binding obligations of Borrowers and Guarantors and
are enforceable against Borrowers and Guarantors in accordance with their
respective terms;
(b) Upon the effectiveness of this First Amendment, each Borrower and
Guarantor hereby reaffirms all covenants, representations and warranties made
in the Loan Agreement to the extent the same are not amended hereby and agree
that all such covenants, representations and warranties shall be deemed to have
been remade as of the effective date of this First Amendment;
(c) No Event of Default or Default has occurred and is continuing or
would exist after giving effect to this First Amendment; and
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(d) No Borrower or Guarantor has any defense, counterclaim or offset
with respect to the Loan Agreement.
5. Effect on the Loan Agreement.
(a) Upon the effectiveness of Section 2 hereof, each reference in the
Loan Agreement to "this Agreement," "hereunder," "hereof," "herein" or words of
like import shall mean and be a reference to the Loan Agreement as amended
hereby.
(b) Except as specifically amended herein, the Loan Agreement, and all
other documents, instruments and agreements executed and/or delivered in
connection therewith, shall remain in full force and effect, and are hereby
ratified and confirmed.
(c) The execution, delivery and effectiveness of this First Amendment
shall not operate as a waiver of any right, power or remedy of Agent or
Lenders, nor constitute a waiver of any provision of the Loan Agreement, or any
other documents, instruments or agreements executed and/or delivered under or
in connection therewith.
6. Governing Law. This First Amendment shall be binding upon and inure to
the benefit of the parties hereto and their respective successors and assigns
and shall be governed by and construed in accordance with the laws of the State
of New York.
7. Headings. Section headings in this First Amendment are included herein
for convenience of reference only and shall not constitute a part of this First
Amendment for any other purpose.
8. Counterparts; Facsimile. This First Amendment may be executed by the
parties hereto in one or more counterparts, each of which shall be deemed an
original and all of which when taken together shall constitute one and the same
agreement. Any signature delivered by a party by facsimile transmission shall
be deemed to be an original signature hereto.
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IN WITNESS WHEREOF, this First Amendment has been duly executed as of the
day and year first written above.
NEW LINDEN PRICE RITE, INC.,
as Borrower and as Guarantor
By:
Name: Xxxxxxx Xxxxxxx
Title: Sr. Vice President
FOODARAMA SUPERMARKETS, INC.,
as Borrower and as Guarantor
By:
Name: Xxxxxxx Xxxxxxx
Title: Sr. Vice President
GMAC BUSINESS CREDIT, LLC,
as Agent
By:
Name:
Title:
GMAC BUSINESS CREDIT, LLC,
as Lender
By:
Name:
Title:
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THE CHASE MANHATTAN BANK,
as Lender
By:
Name:
Title:
CITIZEN BUSINESS CREDIT COMPANY,
as Lender
By:
Name:
Title:
CONSENTED AND AGREED TO:
SHOP RITE OF READING, INC.,
as Guarantor
By:
Name: Xxxxxxx Xxxxxxx
Title: Sr. Vice President
SHOP RITE OF MALVERNE, INC.,
as Guarantor
By:
Name: Xxxxxxx Xxxxxxx
Title: Sr. Vice President
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SCHEDULE 2.01
COMMITMENTS
GMAC Business Credit, LLC:
Revolving Commitment $12,727,272.72
Term Commitment $ 4,545,454.54
Capital Expenditure Facility Commitment $ 9,090,909.10
--------------
Total: $26,363,636.36
The Chase Manhattan Bank:
Revolving Commitment $ 7,636,363.64
Term Commitment $ 2,727,272.73
Capital Expenditure Facility Commitment $ 5,454,545.45
--------------
Total: $15,818,181.82
Citizens Business Credit Company:
Revolving Commitment $ 7,636,363.64
Term Commitment $ 2,727,272.73
Capital Expenditure Facility Commitment $ 5,454,545.45
--------------
Total: $15,818,181.82
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