EXHIBIT 10.2
December 21, 1998
Each of the Lenders party to the Credit
Agreement referred to below
NationsBank, N.A., as Agent
000 Xxxx Xxxxxx, 00xx Xxxxx
Xxxxxx, Xxxxx 00000
Ladies and Gentlemen:
Reference is made to that certain Credit Agreement dated as of November 25,
1996, as amended prior to the date hereof (the "Credit Agreement"), by and among
Gorges/Quik-To-Fix Foods, Inc., as Borrower (the "Borrower"), Gorges Holding
Corporation, as Guarantor ("Holding"), the lending institutions a party thereto
from time to time (the "Lenders") and NationsBank, N.A., successor by merger to
NationsBank of Texas, N.A., as Agent (the "Agent"). Terms used herein and not
defined herein have their respective defined meanings as set forth in the Credit
Agreement.
Pursuant to Section 9(b)(iii) of that certain Fourth Amendment to Credit
Agreement dated as of October 29, 1998 (the "Fourth Amendment"), among the
Borrower, Holding, the Lenders and the Agent the Borrower was required to
deliver to the Agent and each Lender on or before December 1, 1998 evidence that
(A) Borrower has received sufficient capital contributions to allow the Borrower
to (i) purchase at lease $48,000,000 (face amount) of Subordinated Debt and (ii)
make the scheduled interest payment due and payable under the Indenture on
December 1, 1998 (the "Subordinated Debt Interest Payment"); and (B) Borrower
has used such capital contributions to (i) consummate the tender for
subordinated debt contemplated in the preceding clause (A)(i) and cancel all
tendered debt instruments in accordance with the terms of the Indenture on or
before December 1, 1998, and (ii) pay or make provision for the payment of the
Subordinated Debt Interest Payment.
The Borrower and Holding request that the Agent and the Lenders:
(a) confirm the "capital contributions" referred to in the immediately
preceding paragraph and in the Fourth Amendment shall include the $4,052,451.30
bridge loan made by Holding to the Borrower pursuant to that certain Convertible
Subordinated Promissory Note dated December 21, 1998, made by the Borrower in
favor of Holding (the "Holding Bridge Note") a copy of which is attached hereto
as Exhibit A which amount Holding received pursuant to a bridge loan made by CGW
Southeast Partners III, L.P. ("CGW") to Holding pursuant to that certain
Convertible Subordinated Promissory Note dated December 21, 1998, made by
Holding in favor of CGW (the "CGW Bridge Note") a copy of which is attached
hereto as Exhibit B (the foregoing transaction shall be herein referred to as
the "Bridge Loan"); and
(b) consent to the Bridge Loan and waive the application of Sections 8.1
and 8.9 of the Credit Agreement to the incurrence of Indebtedness evidenced by
the CGW Bridge Note.
Holding and Borrower confirm and agree that, notwithstanding anything to
the contrary set forth in the Credit Agreement, the repayment by the Borrower of
any principal or interest under the Holding Bridge Note prior to the repayment
of all amounts outstanding under the Credit Agreement and the termination of the
Credit Agreement shall constitute an Event of Default under the Credit
Agreement.
In partial consideration of the Lenders's agreement to execute and deliver
this letter Agreement, and as a condition precedent to the effectiveness of the
Fourth Amendment, Holding and the Borrower will execute and deliver such
security agreements, pledge agreements and such other documents as may be
necessary or desirable to the attachment and perfection of the Lender's security
interest in the Holding Bridge Note, including UCC financing statements and the
delivery of the Holding Bridge Note to the Agent together with all necessary
endorsements.
This letter agreement shall not be construed to be a waiver relating to any
Default or Event of Default that may be in existence as of the date hereof.
Further, this letter agreement shall not be construed as a consent to any future
actions by the Borrower or Holding which may constitute a Default or Event of
Default or as a consent to any future violation of the terms and conditions of
the Credit Agreement nor shall the Borrower or Holding, by receipt of this
consent, expect that such a consent will be given in the future.
This letter agreement shall be governed by, and construed in accordance
with the laws (other than the conflict of law rules) of the State of North
Carolina.
This letter agreement may be executed in any number of counterparts, each
of which shall be deemed and original and shall be binding upon all parties,
their successors and assigns.
Very truly yours,
GORGES/QUIK-TO-FIX FOODS, INC.
By:
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A. Xxxxx Xxxxxx
Chief Financial Officer
GORGES HOLDING CORPORATION
By:
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Xxxxx X. X'Xxxxxxx
President
Agreed and Accepted:
NATIONSBANK OF TEXAS, N.A., as the
Agent and a Lender
By:
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Title:
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[Signatures Continued on Next Page]
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[AGREEMENT AND ACCEPTANCE TO LETTER AGREEMENT REGARDING GORGES/QUIK-TO FIX
FOODS, INC.]
BANKBOSTON, N.A., formerly
The First National Bank Of Boston
By:
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Title:
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THE CIT GROUP/BUSINESS CREDIT, INC.
By:
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Title:
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BANK AUSTRIA CREDITANSTALT
CORPORATE FINANCE, INC.
By:
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Title:
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XXXXXX TRUST AND SAVINGS BANK
By:
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Title:
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PNC BANK, NATIONAL ASSOCIATION
By:
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Title:
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SUNTRUST BANK, ATLANTA
By:
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Title:
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