THIRD AMENDMENT
Exhibit
4.1
EXECUTION
COPY
THIRD
AMENDMENT
THIRD
AMENDMENT, dated as of January 30, 2009 (this “Amendment”), to the
Revolving Credit Agreement, dated as of August 19, 2005 (as the same may be
amended (including pursuant to this Amendment), supplemented or otherwise
modified from time to time, the “Credit Agreement”),
among SMITHFIELD FOODS, INC., a Virginia corporation (the “Borrower”); each of
the Subsidiaries of the Borrower from time to time party to the Credit Agreement
(individually, a “Subsidiary Guarantor”
and, collectively, the “Subsidiary
Guarantors” and, together with the Borrower, the “Obligors”), the
lenders from time to time party to the Credit Agreement (the “Lenders”), CALYON NEW
YORK BRANCH, COOPERATIEVE CENTRALE RAIFFEISEN-BOERENLEENBANK B.A. “RABOBANK
INTERNATIONAL”, NEW YORK BRANCH and SUNTRUST BANK, as co-documentation agents
(in such capacities, the “Co-Documentation Agents”), CITICORP USA, INC., as
syndication agent (in such capacity, the “Syndication Agent”) and JPMORGAN CHASE
BANK, N.A., as administrative agent (in such capacity, the “Administrative
Agent”).
W I T N E S S E T H :
WHEREAS,
pursuant to the Credit Agreement, the Lenders have agreed to make, and have
made, certain loans and other extensions of credit to the Borrower;
WHEREAS,
the Borrower has requested certain amendments to the Credit Agreement as more
fully set forth herein; and
WHEREAS,
the Lenders have agreed to such amendments but only on the terms and conditions
contained in this Amendment.
NOW,
THEREFORE, the parties hereto hereby agree as follows:
SECTION
1. Defined
Terms. Unless otherwise defined herein, terms defined in the
Credit Agreement and used herein shall have the meanings given to them in the
Credit Agreement.
SECTION
2. Amendments to Section 1.01
of the Credit Agreement. The following definitions set forth
in Section 1.01 of the Credit Agreement shall be amended and restated to read in
their entirety as follows:
“Alternate Base Rate”
means, for any day, a rate per annum (rounded upwards, if necessary, to the next
1/16th of 1%)
equal to the greatest of (a) the Prime Rate in effect on such day, (b) the
Federal Funds Effective Rate for such day plus 0.50% and (c)
the LIBO Quoted Rate for such day plus 1%. As used herein, the term
“LIBO Quoted Rate” means, for any
day, the rate per annum determined on the basis of the rate for deposits in
Dollars for a one-month interest period appearing on Page 3750 of the Telerate
screen as of 11:00 a.m., London time, on such day (or if such day is not a
Business Day, on the immediately preceding Business Day). Any change in the
Alternate Base Rate due to a change in the Prime Rate, the Federal Funds
Effective Rate or the LIBO Quoted Rate shall be effective from and including the
effective date of such change in the Prime Rate, the Federal Funds Effective
Rate or the LIBO Quoted Rate, respectively.
“Applicable Rate”
means, for any day, with respect to any ABR Loan, Eurocurrency Revolving Loan,
Letter of Credit, Swingline Loan, or with respect to the Commitment Fees payable
hereunder, as the case may be, the applicable rate per annum set forth below for
Loans of such Type, for Letters of Credit or Commitment Fees, as the case may
be:
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ABR
Loans and
Swingline Loans
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Eurocurrency
Loans, and
Letters of Credit
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Commitment
Fee
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2.50%
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3.50%
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0.50%
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“Interest Period”
means, with respect to any Eurocurrency Borrowing, the period commencing on the
date of such Borrowing and ending 14 days or on the numerically corresponding
day in the calendar month that is one, two, three or six months thereafter, as
the Borrower may elect; provided, that (i)
subject to clause (iv), if any Interest Period would end on a day other than a
Business Day, such Interest Period shall be extended to the next succeeding
Business Day unless such next succeeding Business Day would fall in the next
calendar month, in which case such Interest Period shall end on the next
preceding Business Day, (ii) any Interest Period that commences on the last
Business Day of a calendar month (or on a day for which there is no numerically
corresponding day in the last calendar month of such Interest Period) shall end
on the last Business Day of the last calendar month of such Interest Period,
(iii) no Interest Period shall extend beyond the Maturity Date and (iv) 14 day
Interest Periods shall end on a Business Day and shall be subject to other
requirements to be specified by the Administrative Agent. For
purposes hereof, the date of a Borrowing initially shall be the date on which
such Borrowing is made and thereafter shall be the effective date of the most
recent conversion or continuation of such Borrowing.
SECTION
3. Amendments to Section
2.02(d) of the Credit Agreement. Section 2.02(d) of the Credit
Agreement is hereby amended in its entirety to read as follows:
“(d) Certain
Limits on Interest Periods. Notwithstanding any other provision of
this Agreement, the Borrower shall (1) not be entitled to request, or to elect
to convert or continue any Borrowing if the Interest Period requested thereto
would end after the Maturity Date or (2) not be entitled to request, or to elect
to convert or continue Eurocurrency Loans with 14 day Interest Periods to the
extent that, after giving effect thereto, the aggregate principal amount of
Eurocurrency Loans with 14 day Interest Periods would exceed
$200,000,000.”
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SECTION
4. Amendments
to Section 2.03(a) of the Credit Agreement. Section 2.03(a) of the
Credit Agreement is hereby amended by deleting clause (iii) thereof and
substituting in lieu thereof the following:
“(iii) in
the case of an ABR Borrowing, not later than 11:30 a.m., New York City time, on
the date of the proposed Borrowing.”
SECTION
5. Amendments to Section
2.06(a) of the Credit Agreement. Section 2.06(a) of the Credit
Agreement is hereby amended by deleting “1:00 p.m.” and substituting in lieu
thereof “1:30 p.m.”.
SECTION
6. Amendments
to Section 6.12(b) of the Credit Agreement. Section 6.12(b) of the Credit
Agreement is hereby amended in its entirety to read as follows:
“(b) Consolidated
Interest Coverage Ratio. The Borrower will not permit the ratio of
Consolidated EBITDA to Consolidated Interest Expense for any period of four
consecutive fiscal quarters of the Borrower ended on the last day of each fiscal
quarter set forth below to be less than the ratio set forth opposite such fiscal
quarter:
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Fiscal Quarter Ending
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Ratio
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February
1, 2009
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1.6
to 1
|
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May
3, 2009
|
1.2
to 1
|
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August
2, 2009
|
1.35
to 1
|
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November
1, 2009
|
1.35
to 1
|
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January
31, 2010
|
2.0
to 1
|
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May
2, 2010 and thereafter
|
3.0
to
1
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SECTION
7. Amendments to Section
6.12(c) of the Credit Agreement. Section 6.12(c) of the Credit
Agreement is hereby amended and restated in its entirety to read as
follows:
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“(c) Inventory
and Receivables. The Borrower will not, on any date on or before the
Security Termination Date, permit the ratio of (i) the sum of 65% of the
aggregate amount of Inventory plus 85% of the aggregate amount of Accounts
Receivable, in each case, of the Borrower and the other Grantors (other than any
Grantor that has sold, conveyed or otherwise transferred Accounts Receivable in
connection with a Receivables Financing) subject to the Lien of the Security
Agreement (the sum of the foregoing amounts shall be calculated based on the
book value of Inventory and Accounts Receivable, as applicable, in accordance
with GAAP as set forth in the financial statements delivered pursuant to Section
5.01(a) or (b), as applicable, and shall apply, for purposes of determining
compliance with this Section, from the date such financial statements are
delivered until such sum is subsequently redetermined as described herein) to
(ii) the aggregate Revolving Credit Exposure of all the Lenders under this
Agreement and any Pari Passu Debt, in either case at such date, to be less than
1.30 to 1 (the “Coverage
Covenant”).”
SECTION
8. Amendments to Section 1 of
the Security Agreement. The definition of “Guarantor
Obligations” set forth in Section 1 of the Security Agreement is hereby amended
by inserting “and all obligations in respect of purchase cards owed to any
Lenders or their Affiliates” after the phrase “automated clearinghouse transfer
funds” in clause (ii), and by inserting “(it being agreed that all of the
foregoing shall constitute Guaranteed Obligations for purposes of the Credit
Agreement)” at the end of the parenthetical in clause (ii) thereof.
SECTION
9. Federal Funds
Borrowings. Notwithstanding anything to the contrary in the
Credit Agreement, no Federal Funds Loans or Federal Funds Borrowings shall (i)
be outstanding as of the Third Amendment Effective Date (other than Federal
Funds Loans as to which the Borrower shall have delivered notices under Section
2.07(b) of the Credit Agreement electing to convert such Federal Funds Loans to
ABR Loans or Eurocurrency Loans in accordance with the requirements of such
Section) or (ii) be made or requested after the Third Amendment Effective
Date.
SECTION
10. Real Property
Mortgages. The Borrower hereby agrees to execute and deliver,
or to cause to be executed and delivered, to the Administrative Agent, within 30
days (or such longer period as shall be consented to by the Administrative
Agent) after the Amendment Effective Date a deed of trust (in form and substance
reasonably satisfactory to the Administrative Agent) with respect to the real
property (including buildings and improvements) of the Borrower and its
Subsidiaries located in Bladen County, North Carolina, known as the Tar Heel
pork processing plant. Borrower shall also (i) deliver, or cause to be
delivered, to the Administrative Agent in respect of such property, a policy of
title insurance issued by First American Title Insurance Company (which title
insurance policy shall be a fully paid policy of title insurance (or marked-up
title insurance commitment having the effect of a policy of title insurance)
insuring the Lien of such deed of trust as a valid first Lien on the real
property and fixtures described therein in the amount equal to not less than the
fair market value of such real property and fixtures, issued by First American
Title Insurance Company, which shall (a) to the extent required by
the Administrative Agent, include such reinsurance arrangements (with provisions
for direct access, if necessary) as shall be reasonably acceptable to the
Administrative Agent, (b) has been supplemented by such endorsements or
affirmative coverage as shall be reasonably requested by the Administrative
Agent (including endorsements on matters relating to usury, first loss,
contiguity (to the extent applicable), revolving credit, doing business,
non-imputation, public road access, survey, variable rate, environmental lien
(to the extent available and commercially reasonable), subdivision (to the
extent applicable), separate tax lot (to the extent applicable), and so-called
comprehensive coverage over covenants and restrictions), and (c) contain no
exceptions to title other than Liens permitted under the Credit Agreement), (ii)
deliver, or cause to be delivered, to the Administrative Agent in respect of
such property, such existing surveys, abstracts, certificates, title documents,
appraisals (to the extent appraisals are required to comply with government
regulations), local counsel opinions and other documents as the Administrative
Agent may reasonably request with respect to such property, in each case in form
and substance reasonably satisfactory to the Administrative Agent, and
(iii) take or cause to be taken such other actions, in each case, as
the Administrative Agent shall reasonably request or require in connection with
the foregoing.
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SECTION
11. Conditions to
Effectiveness. This Amendment shall become effective upon the
date (the “Third
Amendment Effective Date”) on which the following conditions are
satisfied: (i) the Administrative Agent shall have received
counterparts of this Amendment, executed and delivered by a duly authorized
officer of each of the Obligors and Lenders constituting the Required Lenders;
(ii) the Administrative Agent shall have received, for the account of each
Lender which consents to this Amendment on or prior to 5:00 p.m. (EST) on
January 30, 2009, an amendment fee in an amount separately agreed by the
Borrower and the Administrative Agent and notified to the Lenders; (iii) the
Borrower shall be in compliance with the provisions of Section 5 hereof; and
(iv) no Default or Event of Default shall have occurred and be continuing as of
the Third Amendment Effective Date.
SECTION
12. Representations and
Warranties. The Borrower represents and warrants to the
Administrative Agent and the Lenders that as of the Third Amendment Effective
Date, after giving effect to this Amendment, no Default or Event of Default has
occurred and is continuing and the representations and warranties made by the
Borrower in or pursuant to the Credit Agreement or any other Loan Document are
true and correct in all material respects on and as of the Third Amendment
Effective Date as if made on such date (except to the extent that any such
representations and warranties expressly relate to an earlier date, in which
case such representations and warranties were true and correct in all material
respects on and as of such earlier date).
SECTION
13. Effect of
Amendment. (a) This Amendment shall not constitute
an amendment or waiver of or consent to any provision of the Credit Agreement
and the other Loan Documents not expressly referred to herein and shall not be
construed as an amendment, waiver or consent to any action on the part of the
Borrower that would require an amendment, waiver or consent of the
Administrative Agent or the Lenders except as expressly stated
herein. Except as expressly amended hereby, the provisions of the
Credit Agreement and the other Loan Documents are and shall remain in full force
and effect in accordance with its terms.
(b) On
and after the Third Amendment Effective Date, each reference in the Credit
Agreement to “this Agreement”, “hereunder”, “hereof”, “herein”, or words of like
import, and each reference to the Credit Agreement in any other Loan Document
shall be deemed a reference to the Credit Agreement as amended
hereby. This Amendment shall constitute a “Loan Document” for all
purposes of the Credit Agreement and the other Loan Documents.
SECTION
14. Costs and
Expenses. The Borrower agrees to reimburse the Administrative
Agent for its reasonable out-of-pocket expenses in connection with this
Amendment, including the reasonable fees, charges and disbursements of counsel
for the Administrative Agent.
SECTION
15. Headings. The
headings of this Amendment are for purposes of reference only and shall not
limit or otherwise affect the meaning hereof.
SECTION
16. Counterparts. This
Amendment may be executed by one or more of the parties to this Amendment on any
number of separate counterparts (including by facsimile or other electronic
transmission), each of which when so executed and delivered shall be deemed an
original and all of said counterparts taken together shall be deemed to
constitute one and the same instrument.
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SECTION
17. GOVERNING
LAW. THIS AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF THE
PARTIES UNDER THIS AMENDMENT SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED
IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.
[The
remainder of this page is intentionally left blank.]
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IN
WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly
executed and delivered by their respective proper and duly authorized officers
as of the day and year first above written.
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SMITHFIELD
FOODS, INC
|
|
|
By /s/ Xxxxx X.
Xxxxxx
|
|
|
Name:
Xxxxx X. Xxxxxx
|
|
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Title:
Vice President, Finance
|
SUBSIDIARY
GUARANTORS
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THE
SMITHFIELD PACKING COMPANY, INCORPORATED
IOWA
QUALITY MEATS, LTD.
XXXX
XXXXXXX & CO.
NORTH
SIDE FOODS CORP.
XXXXXXX
XXXXXX INCORPORATED
QTF
LIQUIDATION CORP.
STEFANO
FOODS, INC.
XXXXXX
FARMS OF TEXHOMA, INC.
|
XXXXX’X
OF CAROLINA LLC
XXXXXXX’X
FOODS LLC
XXXXXXX’X
FOODS OF
VIRGINIA
LLC
CENTRAL
PLAINS FARMS LLC
CIRCLE
FOUR LLC
XXXXXX
FARMS LLC
QUARTER
M FARMS LLC,
XXXXXX-XXXXX
HOLDINGS LLC
each
a Delaware limited liability company
By XXXXXX-XXXXX
LLC,
a Delaware limited liability
company,
as a sole member of
each
By XXXX
XXXXXXX & CO.,
a Delaware
corporation,
as its sole member
/s/
Xxxxx X. Xxxxxx
Name: Xxxxx X.
Xxxxxx
Title: Vice
President
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|
SMITHFIELD
GLOBAL PRODUCTS INC.
FARMLAND
FOODS, INC.
By /s/
Xxxxx X.
Xxxxxx
Name: Xxxxx
X. Xxxxxx
Title: Vice
President
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XXXXXX-XXXXX
LLC,
a
Delaware limited liability company
By XXXX
XXXXXXX & CO.,
a Delaware
corporation,
as its sole member
/s/
Xxxxx X. Xxxxxx
Name: Xxxxx X.
Xxxxxx
Title: Vice
President
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JPMORGAN
CHASE BANK, N.A., as Administrative Agent and as a Lender
By: /s/ Xxxxxxx X. Xxxxx
Name:
Xxxxxxx X. Xxxxx
Title:
Executive Director
AgFirst
Farm Credit Bank
By: /s/ Xxxx X. Xxxxxxxx,
Xx
Name: Xxxx
X. Xxxxxxxx, Xx.
Title: Vice
President
AgStar
Financial Services, FLCA
By: /s/ Xxxxxx X.
Xxxxxxxx
Name: Xxxxxx
X. Xxxxxxxx
Title: Vice
President
BANK OF
AMERICA, N.A.
By: /s/ Xxxxxxx X.
Xxxxxxx
Name: Xxxxxxx
X. Xxxxxxx
Title: Senior
Vice President
BNP
Paribas
By: /s/ Xxxxxxx
Xxxxxx
Name: Xxxxxxx
Xxxxxx
Title: Director
By: /s/ Xxxxxx
Xxxxxx
Name: Xxxxxx
Xxxxxx
Title: Vice
President
Calyon
New York Branch,
By: /s/ Xxxxx
Xxxxx
Name: Xxxxx
Xxxxx
Title: Managing
Director
By: /s/ Xxxxxx
Xxxxx
Name: Xxxxxx
Xxxxx
Title: Managing
Director
Citicorp
USA, Inc.
By: /s/ Xxxxxx X.
Xxxx
Name: Xxxxxx
X. Xxxx
Title: Managing
Director
CoBANK,
ACB
By: /s/ Xxxx
Norte
Name: Xxxx
Norte
Title: Vice
President
COMMERZBANK
AG, NEW YORK
AND GRAND
CAYMAN BRANCHES
By: /s/ G. Xxx
XxXxxxxxx
Name: G.
Xxx XxXxxxxxx
Title: Senior
Vice President
By: /s/ Xxxxxxx X.
Xxxxxxxx
Name: Xxxxxxx
X. Xxxxxxxx
Title: First
Vice President
COOPERATIEVE
CENTRALE RAIFFEISEN-
BOERENLEENBANK
B.A., “RABOBANK NEDERLAND”, NEW YORK BRANCH
By: /s/ Xxxx X.
Xxxxxxxxx
Name: Xxxx
X. Xxxxxxxxx
Title: Vice
President
By: /s/ Xxxxxx
Xxxxxxx
Name: Xxxxxx
Xxxxxxx
Title: Executive
Director
FARM
CREDIT BANK OF TEXAS
By: /s/ Xxxx
Xxxxxxxx
Name: Xxxx
Xxxxxxxx
Title: Vice
President
Farm
Credit Services of America, PCA
By: /s/ Xxxxx
Xxxx
Name: Xxxxx
Xxxx
Title: Vice
President
FARM
CREDIT SERVICES OF MID-AMERICA, FLCA
By: /s/ Xxxxx X.
Xxxxxx
Name: Xxxxx
X. Xxxxxx
Title: Vice
President
FARM
CREDIT WEST, FLCA
By: /s/ Ben
Xxxxxxx
Name: Ben
Xxxxxxx
Title: Vice
President
FCS
FINANCIAL, PCA
By: /s/ Xxx
Xxxxx
Name: Xxx
Xxxxx
Title: Vice
President
First
Pioneer Farm Credit, ACA
By: /s/ Xxxxx X.
Xxxxx
Name: Xxxxx
X. Xxxxx
Title: Vice
President
Fresno-Madera
Production Credit Association
By: /s/ Xxxxx X.
XxXxxx
Name: Xxxxx
X. XxXxxx
Title: Executive
Vice President
GENERAL
ELECTRIC CAPITAL CORPORATION
By: /s/ Xxxxxx X.
Xxxxx
Name: Xxxxxx
X. Xxxxx
Title: Duly
Authorized Signatory
XXXXXXX
XXXXX CREDIT PARTNERS, L.P.
By: /s/ Xxxxxx
Xxxxxx
Name: Xxxxxx
Xxxxxx
Title: Vice
President
GreenStone
Farm Credit Services, ACA/FLCA
By: /s/ Xxxxxx X. Xxxxxxx,
Xx.
Name: Xxxxxx
X. Xxxxxxx, Xx.
Title: VP/Managing
Director
Xxxxxx
X.X.
By: /s/ Xxxx
Xxxxxx
Name: Xxxx
Xxxxxx
Title: Vice
President
HSBC Bank
USA, National Association
By: /s/ Xxxxxx X.
Xxxxx
Name: Xxxxxx
X. Xxxxx
Title: Managing
Director
ING
Capital LLC
By: /s/ Xxxx
Xxxxxx
Name: Xxxx
Xxxxxx
Title: Vice
President
MidAtlantic
Farm Credit, ACA
By: /s/ Xxxxxxx X.
Xxxxxx
Name: Xxxxxxx
X. Xxxxxx
Title: Vice
President
MIZUHO
CORPORATE BANK, LTD.
By: /s/ Xxxxxx
Xxxxxxxxx
Name: Xxxxxx
Xxxxxxxxx
Title: Authorized
Signatory
Northwest
Farm Credit Services, FLCA
By: /s/ Xxxxx X.
Xxxxxx
Name: Xxxxx
X. Xxxxxx
Title: Vice
President
THE ROYAL
BANK OF SCOTLAND PLC
By: /s/ Xxxxxxx
XxXxxxx
Name: Xxxxxxx
XxXxxxx
Title: Senior
Vice President
SOCIETE
GENERALE
By: /s/ Xxxxxxxxx
Xxxxxxx
Name: Xxxxxxxxx
Xxxxxxx
Title: Managing
Director
SUNTRUST
BANK
By: /s/ M. Xxxx
Xxxxxxxx
Name: M.
Xxxx Xxxxxxxx
Title: Vice
President
United
FCS, FLCA d/b/a FCS Commercial Finance Group
By: /s/ Xxxx
Xxxxxxx
Name: Xxxx
Xxxxxxx
Title: Assistant
Vice President
U.S.
AgBank, FCB
By: /s/ Xxxxxx X.
Xxxx
Name: Xxxxxx
X. Xxxx
Title: Vice
President
U.S. BANK
NATIONAL ASSOCIATION
By: /s/ Xxxxxx
Xxxxxx
Name: Xxxxxx
Xxxxxx
Title: Senior
Vice President
Wachovia
Bank, National Association
By: /s/ Xxxx
Xxx
Name: Xxxx
Xxx
Title: Vice
President
