VOLUME SERVICES AMERICA, INC.
FIRST AMENDMENT TO
CREDIT AGREEMENT
This FIRST AMENDMENT dated as of February 8, 1999 TO THE CREDIT AGREEMENT
(this "AMENDMENT") dated as of December 3, 1998 and is entered into by and among
VOLUME SERVICES AMERICA, INC., a Delaware corporation (the "Borrower''), VOLUME
SERVICES AMERICA HOLDINGS, INC., a Delaware corporation ("Holdings''), CREDIT
SUPPORT PARTIES, CERTAIN FINANCIAL INSTITUTIONS listed on the signature pages
thereof (each individually a "LENDER" and collectively the "LENDERS") XXXXXXX
XXXXX CREDIT PARTNERS L.P. ("GSCP''), as a Joint Lead Arranger and Syndication
Agent (in such capacity, the "SYNDICATION AGENT''), CHASE MANHATTAN BANK
DELAWARE, as the Fronting Bank (together with its permitted successors in such
capacity, the "FRONTING BANK'') and THE CHASE MANHATTAN BANK ("CHASE'') as a
Joint Lead Arranger, the Swingline Lender (as defined therein) and the
Administrative Agent (together with its permitted successors in such capacity,
the "ADMINISTRATIVE AGENT'') (such agreement as amended, supplemented or
otherwise modified from time to time, the "CREDIT AGREEMENT"). Capitalized terms
used herein without definition shall have the same meanings herein as set forth
in the Credit Agreement and in the amendments contained in Section 1 hereof.
RECITALS
WHEREAS, Borrower has requested that Required Lenders and all Lenders with
a Revolving Credit Commitment agree to modify certain provisions of the Credit
Agreement in connection with the provision of Letters of Credit to be
denominated in Canadian Dollars.
WHEREAS, Borrower proposes to issue the Subordinated Notes and has
requested, in connection therewith, that Required Lenders agree to modify
certain provisions of the Credit Agreement to permit (i) the incurrence of
additional Indebtedness pursuant to the issuance of the Subordinated Notes, (ii)
the payment of a dividend by the Borrower and Holdings with a portion of the
proceeds of the Subordinated Notes, and (iii) certain related transactions.
NOW, THEREFORE, in consideration of the premises and the agreements,
provisions and covenants herein contained, the parties hereto agree as follows:
1
SECTION 1. AMENDMENTS TO CREDIT AGREEMENT
1.1 AMENDMENTS TO SECTION 1: DEFINITIONS
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A. Subsection 1.1 of the Credit Agreement is hereby amended by adding thereto
the following definitions, which shall be inserted in proper alphabetical
order:
"CANADIAN DOLLARS" shall mean the lawful money of Canada.
"CANADIAN DOLLAR EQUIVALENT" means, at any time, as to any amount
denominated in Dollars the equivalent amount in Canadian Dollars as
determined by Administrative Agent at such time on the basis of the
applicable Exchange Rate for the purchase of Canadian Dollars with Dollars
on the most recent computation date provided for in subsection 2.12(h).
"CANADIAN DOLLAR LETTER OF CREDIT SUBLIMIT" shall mean as defined in
subsection 2.20(a) of this Agreement.
"DOLLAR EQUIVALENT" means, at any time, as to any amount denominated
in Canadian Dollars, the equivalent amount in Dollars as determined by the
Administrative Agent at such time on the basis of the applicable Exchange
Rate for the purchase of Dollars with Canadian Dollars on the most recent
computation date provided for in subsection 2.12(h).
"EXCHANGE RATE" means, on any date when an amount for Dollars or
Canadian Dollars is to be determined with respect to any Letter of Credit,
the rate quoted by Administrative Agent as the spot rate for the purchase
by Fronting Bank (by cable transfer) of such currency with the other
currency in the New York foreign exchange market at 12:00 noon (New York
time) on such date.
"SUBORDINATED GUARANTY" shall mean the subordinated guaranty, in
respect of the obligations under the Subordinated Notes, made by Holdings
and the Subsidiary Guarantors.
"SUBORDINATED NOTE INDENTURE" means the indenture pursuant to which
the Subordinated Notes are issued, as such indenture may be amended from
time to time to the extent permitted under Section 6.09 the term and
conditions thereof being in form and substance satisfactory to
Administrative Agent.
"SUBORDINATED NOTES" shall mean as defined in Subsection 6.01(t) of
this Agreement.
B. Subsection 1.1 of the Credit Agreement is hereby further amended by
deleting the definitions of "EBITDA,""Letter of Credit Exposure" and
"Non-Wholly-Owned Subsidiary" in their entirety and substituting therefor
the following:
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"EBITDA" shall mean, with respect to Holdings, the Borrower and the
Subsidiaries on a consolidated basis for any period, the consolidated net
income of Holdings, the Borrower and the Subsidiaries for such period plus,
to the extent deducted in computing such consolidated net income, without
duplication, the sum of (a) income tax expense and withholding tax expense
incurred in connection with cross border transactions involving
non-domestic Subsidiaries, (b) interest expense, (c) depreciation and
amortization expense, (d) any fees and expenses incurred in connection with
the Transactions, the Subordinated Notes and this Amendment, and any
special charges or extraordinary or non-recurring losses related to the
Transactions incurred within twelve months of the Closing Date,
(e) monitoring and management fees paid to the Funds and/or any Fund
Affiliates and GECC or its Affiliates, and (f) other noncash items reducing
consolidated net income, minus, to the extent added in computing such
consolidated net income, without duplication, (i) interest income,
(ii) extraordinary or non-recurring gains and (iii) other noncash items
increasing consolidated net income; provided that, for purposes of
calculating EBITDA for any period ending prior to the end of the first four
full fiscal quarters ending after the Closing Date, the adjustments to
EBITDA set forth in Schedule 1.01 shall be applied except for purposes of
calculating Consolidated Cash Net Worth; provided further, that, for
purposes of calculating EBITDA (other than Pro Forma Contract EBITDA),
there shall be excluded therefrom the income (or loss) of any person other
than a Wholly-Owned Subsidiary of the Borrower, except to the extent of the
amount of dividends or other distributions actually paid to the Borrower or
any of its Wholly-Owned Subsidiaries by such person during the applicable
period.
"LETTER OF CREDIT EXPOSURE" shall mean at any time the sum of (a) the
aggregate undrawn amount of all outstanding Letters of Credit at such time
plus (b) the aggregate principal amount of all Letter of Credit
Disbursements that have not yet been reimbursed at such time. The Letter of
Credit Exposure of any Revolving Credit Lender at any time shall mean its
Applicable Percentage of the aggregate Letter of Credit Exposure at such
time. For the purposes of this definition, any amount described in clause
(a) or (b) of the first sentence of this definition which is denominated in
Canadian Dollars shall be valued in Dollars at the applicable Exchange Rate
as of the applicable date of determination.
"NON-WHOLLY-OWNED SUBSIDIARY" shall mean any (i) Subsidiary other than
a Wholly-Owned Subsidiary and (ii) joint venture.
1.2 AMENDMENTS TO SECTION 2: LETTERS OF CREDIT
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A. Subsection 2.12(b) is hereby amended as follows:
"(b) In the event of any termination of the Revolving Credit
Commitments, the Borrower shall on the date of such termination repay or
prepay all its outstanding Swingline Loans and Revolving Credit Borrowings,
reduce the Letter of Credit Exposure to zero and cause all Letters of
Credit to be canceled and returned to the Fronting Bank. In the event
(y) of any partial reduction of the Revolving Credit Commitments or
(z) after giving effect to the provisions of clause (h) of
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Section 2.12 the Letter of Credit Exposure exceeds $35,000,000 or the
Letters of Credit denominated in Canadian Dollars exceed the Canadian
Dollar Letter of Credit Sublimit, then (i) at or prior to the effective
date of any such reduction, the Administrative Agent shall notify the
Borrower, the Swingline Lender and the Revolving Credit Lenders of the
Total Revolving Credit Exposure and (ii) if after giving effect to any such
reduction or event described in clause (h) of this Section 2.12, the Total
Revolving Credit Exposure would exceed the Total Revolving Credit
Commitment, then the Borrower shall, on the date of any such reduction, as
applicable, repay or prepay Revolving Borrowings or repay or prepay
Swingline Loans or reduce the Letter of Credit Exposure (which for purposes
of this clause (ii) may include cash collateralization of Letter of Credit
Exposure pursuant to arrangements satisfactory to Administrative Agent), in
an aggregate amount sufficient to eliminate such excess. Notwithstanding
the foregoing, on the date of any termination or reduction of the Revolving
Credit Commitments pursuant to Section 2.09, the Borrower shall pay or
prepay so much of the Revolving Credit Borrowings and Swingline Loans as
shall be necessary in order that the Total Revolving Credit Exposure shall
not exceed the Total Revolving Credit Commitment after giving effect to
such termination or reduction."
B. Subsection 2.12 is hereby further amended by the addition of a new
subsections 2.12(h) as follows:
"(h) Fluctuations in Exchange Rate. The Dollar Equivalent of the
aggregate amount of the Letter of Credit Exposure denominated in Canadian
Dollars shall be calculated on (v) the date of any participation in a
Canadian Dollar denominated Letter of Credit pursuant to subsection
2.20(d), (w) the date of any reimbursement of a Letter of Credit
Disbursement under a Canadian Dollar denominated Letter of Credit pursuant
to subsection 2.20(e), (x) the date of issuance of any Letter of Credit
denominated in Canadian Dollars, (y) the last Business Day of each calendar
month and (z) from time to time at Administrative Agent's reasonable
discretion, and such calculation shall remain in effect for purposes of
this Agreement until the next date on which an event described in this
clause (h) occurs and a recalculation is made."
C. Paragraphs (a), (b), (d) and (e) of Subsection 2.20 of the Credit Agreement
are hereby amended to read in their entirety as follows:
"(a) The Borrower may request the issuance of a Letter of Credit, in a
form reasonably acceptable to the Administrative Agent and the Fronting
Bank, appropriately completed, for the account of the Borrower and, if
requested by the Borrower, a Subsidiary, on a joint and several basis, at
any time and from time to time while the Revolving Credit Commitments
remain in effect. This Section 2.20(a) shall not be construed to impose an
obligation upon the Fronting Bank to issue any Letter of Credit that is
inconsistent with the terms and conditions of this Agreement or that would
result in there existing (i) Letters of Credit in an aggregate stated
amount at any time in excess of $35,000,000 or (ii) Letters of Credit
denominated in Canadian Dollars in excess of the Canadian Dollar Equivalent
of $10,000,000 (the "Canadian Dollar Letter of Credit Sublimit").
Notwithstanding anything herein to the contrary, each of the letters of
credit outstanding on the Closing Date that are identified on Schedule 2.20
shall be deemed to be a Letter of Credit issued and outstanding under this
Agreement as of the Closing Date."
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"(b) Notice of Issuance, Amendment, Renewal, Extension; Certain
Conditions. In order to request the issuance of a Letter of Credit (or to
request that the Fronting Bank amend, renew or extend an existing Letter of
Credit), the Borrower shall hand deliver or telecopy to the Fronting Bank
and the Administrative Agent (reasonably in advance of the requested date
of issuance, amendment, renewal or extension) a notice requesting the
issuance of such Letter of Credit, or identifying any Letter of Credit to
be amended, renewed or extended, and specifying the date of issuance,
amendment, renewal or extension, the date on which such Letter of Credit is
to expire (which shall comply with paragraph (c) below), the amount of such
Letter of Credit to be issued, amended, renewed or extended, the name and
address of the beneficiary thereof, whether the Letter of Credit is to be
denominated in Dollars or Canadian Dollars and such other information as
shall be necessary to prepare such Letter of Credit or grant such issuance,
amendment, renewal or extension. Following receipt of such notice and prior
to the issuance, amendment, renewal or extension of any Letter of Credit
the Administrative Agent shall notify the Borrower and the Fronting Bank of
the amount of the Total Revolving Credit Exposure after giving effect to
(i) the issuance, amendment, renewal or extension of such Letter of Credit,
(ii) the issuance or expiration of any other Letter of Credit that is to be
issued or will expire prior to the requested date of issuance of such
Letter of Credit and (iii) the borrowing or repayment of any Revolving
Loans and Swingline Loans that (based upon notices delivered to the
Administrative Agent by the Borrower) are to be borrowed or repaid prior to
the requested date of issuance, amendment, renewal or extension of such
Letter of Credit. Each Letter of Credit shall be issued, amended, renewed
or extended subject to the terms and conditions and relying on the
representations and warranties of Holdings and the Borrower set forth
herein, and in any case only if, and upon issuance, amendment, renewal or
extension of each Letter of Credit the Borrower shall be deemed to
represent and warrant that, after giving effect to such issuance,
amendment, renewal or extension the Total Revolving Credit Exposure shall
not exceed the Total Revolving Credit Commitment in effect at such time.
Any Letter of Credit may be issued by the Fronting Bank through its
affiliate, Chase, and in the event of any such issuance, all references
herein and in the other Loan Documents to the term "Fronting Bank" shall,
with respect to such Letter of Credit, be deemed to refer to Chase, in such
capacity, as the context shall require."
"(d) Participations. By the issuance of a Letter of Credit and without
any further action on the part of the Fronting Bank or the Revolving Credit
Lenders, the Fronting Bank will grant to each Revolving Credit Lender, and
each such Lender will acquire from the Fronting Bank, a participation in
such Letter of Credit equal to such Revolving Credit Lender's Applicable
Percentage of the aggregate amount available to be drawn under such Letter
of Credit (calculated in the case of a Letter of Credit denominated in
Canadian Dollars, by reference to the applicable Exchange Rate), effective
upon the issuance of such Letter of Credit. In consideration and in
furtherance of the foregoing, each Revolving Credit Lender hereby
absolutely and unconditionally agrees to pay to the Administrative Agent,
for the account of the Fronting Bank, such Revolving Credit Lender's
Applicable Percentage of each Letter of Credit Disbursement (which amount,
in the case of a Letter of Credit Disbursement under a Letter or Credit
denominated in Canadian Dollars, shall (y)he calculated by reference to
the applicable Exchange Rate and (z) payable in Dollars), made by the
Fronting Bank under such Letter of Credit and not reimbursed by the
Borrower (or, if applicable, another party pursuant to its obligations
under any other Loan Document) on or before
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the next Business Day as provided in paragraph (e) below. Each Revolving
Credit Lender acknowledges and agrees that its obligation to acquire
participations pursuant to this paragraph in respect of Letters of Credit
which were issued upon satisfaction of all applicable conditions precedent
is absolute and unconditional and shall not be affected by any circumstance
whatsoever, including the occurrence and continuance of a Default or an
Event of Default, and that each such payment shall be made without any
offset, abatement, withholding or reduction whatsoever."
"(e) Reimbursement. If the Fronting Bank shall make any Letter of
Credit Disbursement in respect of a Letter of Credit, the Borrower shall
pay to the Administrative Agent, on or before the Business Day immediately
following the date of such Letter of Credit Disbursement, an amount in
Dollars (which amount, in the case of a Letter of Credit Disbursement under
a Letter of Credit denominated in Canadian Dollars, shall (y) be calculated
by reference to the applicable Exchange Rate and (z) be payable in
Dollars), equal to such Letter of Credit Disbursement. If the Borrower
shall fail to pay any amount required to be paid under this paragraph on or
before such Business Day (or to cause payment thereof when due pursuant to
a Revolving Credit Borrowing), then (i) such unpaid amount shall bear
interest, for each day from and including such Business Day to but
excluding the date of payment, at a rate per annum equal to the interest
rate applicable to overdue ABR Loans that are Revolving Loans pursuant to
Section 2.07 (provided that the 2.00% margin applicable to overdue Loans
shall not be applicable until the first Business Day after the Borrower
receives notice from the Administrative Agent that such Letter of Credit
Disbursement has been or will be made), (ii) the Administrative Agent shall
notify the Fronting Bank and the Revolving Credit Lenders thereof,
(iii) each Revolving Credit Lender shall comply with its obligation under
paragraph (d) above by wire transfer of immediately available funds, in the
same manner as provided in Section 2.02(c) with respect to Loans made by
such Revolving Credit Lender (and Section 2.02(d) shall apply, mutatis
mutandis, to the payment obligations of the Revolving Credit Lenders) and
(iv) the Administrative Agent shall promptly pay to the Fronting Bank
amounts so received by it from the Revolving Credit Lenders. The
Administrative Agent shall promptly pay to the Fronting Bank on a pro rata
basis with respect to outstanding Letter of Credit Disbursements any
amounts received by it from the Borrower pursuant to this paragraph prior
to the time that any Revolving Credit Lender makes any payment pursuant to
paragraph (d) above; any such amounts received by the Administrative Agent
thereafter shall be promptly remitted by the Administrative Agent to the
Revolving Credit Lenders that shall have made such payments and to the
Fronting Bank, as their interests may appear."
1.3 AMENDMENTS TO SECTION 6: NEGATIVE COVENANTS
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A. Subsection 6.01 is hereby amended by the deletion of the word "and" after
paragraph "(s)" thereof, the deletion of paragraph (t) thereof and by the
addition of new paragraphs (t) and (u) as follows:
"(t) Indebtedness evidenced by the Subordinated Notes, and the
guaranty thereof under the Subordinated Guaranty, issued pursuant to the
Subordinated Note Indenture; provided that (A) the Subordinated Notes shall
(i) be in an aggregate principal amount of not less than $100,000,000, (ii)
be due no earlier than 2009 and (iii) all other terms and conditions in
respect
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thereof shall be in form and substance satisfactory to Administrative Agent
(the "Subordinated Notes") and (B) the Subordinated Guaranty shall be
subordinated on the terms and conditions substantially the same as the
subordination provisions set forth in the Subordinated Note Indenture; and
(u) all premium (if any), interest (including post-petition interest),
fees, expenses, indemnities, charges and additional or contingent interest
on obligations described in clauses (a) through (t) above.
B. Subsection 6.06 is hereby amended by deleting the word "and" immediately
before clause (j) thereof and the addition of a new clause (k) as follows:
"; and (k) so long as no Default or Event of Default shall have
occurred and be continuing or shall be caused thereby, Borrower may (x) pay
a dividend to Holdings and Holdings may in turn redeem its stock held by,
or pay dividends to, its shareholders in an aggregate amount in each case
not to exceed $49,500,000, (y) make payments of expenses and fees
associated with the issuance of the Subordinated Notes in an aggregate
amount not to exceed $5,000,000 and (z) repay the GECC Promissory Note,
each from the proceeds of, and simultaneously with the issuance of, the
Subordinated Notes."
C. Subsection 6.06 is hereby further amended by the addition of a new
paragraph thereto as follows:
"Certain payments of Subordinated Indebtedness. Borrower may make
regularly scheduled payments of interest in respect of the Subordinated
Notes in accordance with terms of, and only to the extent required by, and
subject to the subordination provisions contained in, the Subordinated Note
Indenture."
D. Subsection 6.09 (c) is hereby amended to read in its entirety as follows:
"(c) (i) Amend or modify in any manner adverse to the Lenders, or
grant any waiver or release under or terminate in any manner (if such
action shall be adverse to the Lenders), the certificate of incorporation
or bylaws in any material respect of Holdings, the Borrower or any
Subsidiary or the Share Exchange Agreement or (ii) change the terms of the
Subordinated Note Indenture or the Subordinated Notes, or make any payment
consistent with an amendment thereof or change thereto, if the effect of
such amendment or change is to increase the interest rate on the
Subordinated Note Indenture or the Subordinated Notes, change (to earlier
dates) any dates upon which scheduled payments of principal or interest are
due thereon, change any event of default or condition to an event of
default with respect thereto (other than to eliminate any such event of
default or increase any grace period related thereto or to make such
provision more favorable to the Borrower), change the redemption,
prepayment or defeasance provisions thereof in a manner materially adverse
to the Lenders, change the subordination provisions of such Subordinated
Notes (or of any guaranty thereof), or change any collateral therefor
(other than to release such collateral), if the effect of such action,
amendment or change, together with all other amendments or changes
7
made, is to increase materially the obligations of the obligor thereunder
or to confer any additional rights on the holders of such Subordinated
Notes (or a trustee or other representative on their behalf) which would be
adverse to any Loan Party or Lenders or (iii) designate any Indebtedness as
"Designated Senior Indebtedness" (as defined in the Subordinated Note
Indenture) for purposes of the Subordinated Note Indenture without the
prior written consent of the Administrative Agent."
E. Subsection 6.11 is hereby amended by deleting the table at the end thereof
and replacing it with the following table:
Fiscal Quarter: Amount:
First fiscal quarter 1999 1.75:1.00
Second fiscal quarter 1999 1.75:1.00
Third fiscal quarter 1999 1.75:1.00
Fourth fiscal quarter 1999 1.75:1.00
First fiscal quarter 2000 1.75:1.00
Second fiscal quarter 2000 1.75:1.00
Third fiscal quarter 2000 1.85:1.00
Fourth fiscal quarter 2000 1.85:1.00
First fiscal quarter 2001 1.85:1.00
Second fiscal quarter 2001 1.85:1.00
Third fiscal quarter 2001 2.00:1.00
Fourth fiscal quarter 2001 2.00:1.00
First fiscal quarter 2002 2.00:1.00
Second fiscal quarter 2002 2.00:1.00
Third fiscal quarter 2002 2.00:1.00
Fourth fiscal quarter 2002 2.00:1.00
First fiscal quarter 2003 2.00:1.00
Second fiscal quarter 2003 2.00:1.00
Third fiscal quarter 2003 2.00:1.00
Fourth fiscal quarter 2003 2.00:1.00
First fiscal quarter 2004 2.00:1.00
Second fiscal quarter 2004 2.00:1.00
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Third fiscal quarter 2004 2.00:1.00
Fourth fiscal quarter 2004 2.00:1.00
First fiscal quarter 2005 2.00:1.00
Second fiscal quarter 2005 2.00:1.00
Third fiscal quarter 2005 2.00:1.00
Fourth fiscal quarter 2005 2.00:1.00
First fiscal quarter 2006 2.00:1.00
Second fiscal quarter 2006 2.00:1.00
Third fiscal quarter 2006 2.00:1.00
Fourth fiscal quarter 2006 2.00:1.00
F. Subsection 6.12 is hereby amended by deleting the table at the end thereof
and replacing it with the following table:
Fiscal Quarter: Amount:
First fiscal quarter 1999 5.60:1.00
Second fiscal quarter 1999 5.60:1.00
Third fiscal quarter 1999 5.35:1.00
Fourth fiscal quarter 1999 5.35:1.00
First fiscal quarter 2000 5.35:1.00
Second fiscal quarter 2000 5.35:1.00
Third fiscal quarter 2000 5.25:1.00
Fourth fiscal quarter 2000 5.25:1.00
First fiscal quarter 2001 5.25:1.00
Second fiscal quarter 2001 5.25:1.00
Third fiscal quarter 2001 5.00:1.00
Fourth fiscal quarter 2001 5.00:1.00
First fiscal quarter 2002 5.00:1.00
Second fiscal quarter 2002 5.00:1.00
Third fiscal quarter 2002 4.75:1.00
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Fourth fiscal quarter 2002 4.75:1.00
First fiscal quarter 2003 4.75:1.00
Second fiscal quarter 2003 4.75:1.00
Third fiscal quarter 2003 4.50:1.00
Fourth fiscal quarter 2003 4.50:1.00
First fiscal quarter 2004 4.50:1.00
Second fiscal quarter 2004 4.50:1.00
Third fiscal quarter 2004 4.50:1.00
Fourth fiscal quarter 2004 4.50:1.00
First fiscal quarter 2005 4.50:1.00
Second fiscal quarter 2005 4.50:1.00
Third fiscal quarter 2005 4.50:1.00
Fourth fiscal quarter 2005 4.50:1.00
First fiscal quarter 2006 4.50:1.00
Second fiscal quarter 2006 4.50:1.00
Third fiscal quarter 2006 4.50:1.00
Fourth fiscal quarter 2006 4.50:1.00
1.4 AMENDMENTS TO ARTICLE IX.
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A. Article IX is hereby amended by adding the following Subsection 9.18 in its
entirety as follows:
"9.18 Judgement Currency. Borrower, Agents and each Lender hereby
agree that if, in the event that a judgment is given in relation to any sum
due to any Agent or any Lender hereunder, such judgement is given in a
currency (the "Judgement Currency") other than in Dollars Borrower agrees
to indemnify such Agent or Lender, as the case may be, to the extent that
the amount of Dollars which could have been purchased thereby in accordance
with normal banking procedures on the Business Day following receipt of
such sum is less than the sum which could have been so purchased thereby
had such purchase been made on the day on which such judgement was given
or, if such day is not a Business Day, on the Business Day immediately
preceding the giving of such judgment, and if the amount which could have
been purchased on the following Business Day exceeds the amount which could
have been so purchased thereby had such purchase been made on the day on
which such judgment was given or, if such day is not a Business Day, on the
Business
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Day immediately preceding such judgment, such Agent or Lender agrees to
remit such excess to Borrower. The agreements in this Section 9.18 shall
survive payment of any such judgement."
SECTION 2. CONDITIONS TO EFFECTIVENESS
Section 1 of this Amendment shall become effective only upon the
satisfaction of all of the following conditions precedent (the date of
satisfaction of such conditions being referred to herein as the "First Amendment
Effective Date"):
A. EXECUTION. Loan Parties, Required Lenders and the Credit Support
Parties shall have executed this Amendment.
B. RELATED AGREEMENTS. Borrower have delivered to Administrative Agent
complete and correct copies of the Subordinated Note Indenture and
Subordinated Notes and of all exhibits and schedules thereto.
C. REPAYMENT OF LOANS. The Borrower shall repay, simultaneous with the
issuance of the Subordinated Notes and the receipt of the proceeds
thereof, with the balance of the proceeds of such issuance after the
payment of the dividend and other amounts provided for in Subsection
1.3B. of this First Amendment, in an aggregate amount of not less than
$45,000,000, first the Term Loans to the full extent thereof on a pro
rata basis, subject to subsection 2.12(g) of the Credit Agreement, and
second to the extent of any of such proceeds remaining, the Revolving
Loans to the full extent thereof.
D. OPINIONS OF LOAN PARTIES' COUNSEL. Administrative Agent (for Lenders)
shall have received an executed copy of one or more favorable written
opinions in respect of the Subordinated Notes of Xxxxxxx Xxxxxxxx &
Xxxxxxxx, counsel for the Loan Parties dated as of the First Amendment
Effective Date and in form and substance reasonably satisfactory to
Administrative Agents and their counsel.
E. FEES. The Administrative Agent shall have received all Fees and other
amounts due and payable on or prior to the First Amendment Effective
Date, including, to the extent invoiced, reimbursement or other
payment of all out-of-pocket expenses required to be reimbursed or
paid by the Borrower hereunder or under any other Loan Document.
F. NECESSARY CONSENTS. Each Loan Party shall have obtained all material
consents necessary or advisable in connection with the borrowing by
Borrower of the Indebtedness evidenced by the Subordinated Notes and
the transactions contemplated by the First Amendment.
G. OTHER DOCUMENTS. Administrative Agent and Lenders shall have received
such other documents and information regarding Loan Parties and the
Subordinated Notes as Administrative Agent may reasonably request.
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SECTION 3. BORROWER'S REPRESENTATIONS AND WARRANTIES
In order to induce Lenders to enter into this Amendment and to amend the
Credit Agreement in the manner provided herein, Borrower represents and warrants
to each Lender that the following statements are true, correct and complete in
all material respects:
A. CORPORATE POWER AND AUTHORITY. Each Loan Party which is party hereto
has all requisite corporate power and authority to enter into this
Amendment and to carry out the transactions contemplated by, and
perform its obligations under, the Credit Agreement as amended by this
Amendment (the "Amended Agreement") and the other Loan Documents.
B. AUTHORIZATION OF AGREEMENTS. The execution and delivery of this
Amendment and the performance of the Amended Agreement and the other
Loan Documents have been duly authorized by all necessary corporate or
partnership (as applicable) action on the part of each Loan Party.
C. NO CONFLICT. The execution and delivery by each Loan Party of this
Amendment and the performance by each Loan Party of the Amended
Agreement and the other Loan Documents do not and will not (i) violate
(A) any provision of any law, statute, rule or regulation, or of the
certificate or articles of incorporation or partnership agreement,
other constitutive documents or by- laws of Holdings, the Borrower or
any Subsidiary, (B) any applicable order of any court or any rule,
regulation or order of any Governmental Authority or (C) any provision
of any indenture, certificate of designation for preferred stock,
agreement or other instrument to which Holdings, the Borrower or any
Subsidiary is a party or by which any of them or any of their property
is or may be bound, (ii) be in conflict with, result in a breach of or
constitute (alone or with notice or lapse of time or both) a default
under any such indenture, certificate of designation for preferred
stock, agreement or other instrument, where any such conflict,
violation, breach or default referred to in clause (i) or (ii) of this
Section 3.C., individually or in the aggregate could reasonably be
expected to have a Material Adverse Effect, (iii) result in or require
the creation or imposition of any Lien upon any of the properties or
assets of each Loan Party (other than any Liens created under any of
the Loan Documents in favor of Administrative Agent on behalf of
Lenders), or (iv) require any approval of stockholders or partners or
any approval or consent of any Person under any contractual obligation
of each Loan Party, except for such approvals or consents which will
be obtained on or before the First Amendment Effective Date.
D. GOVERNMENTAL CONSENTS. No action, consent or approval of, registration
or filing with or any other action by any Governmental Authority is or
will be required in connection with the execution and delivery by each
Loan Party of this Amendment and the performance by Borrower and
Holdings of the Amended Agreement and the other Loan Documents, except
for such actions, consents and approvals the failure to obtain or make
which could not reasonably be expected to result in a Material Adverse
Effect or which have been obtained and are in full force and effect.
12
E. BINDING OBLIGATION. This Amendment and the Amended Agreement have been
duly executed and delivered by each of the Loan Parties party thereto
and each constitutes a legal, valid and binding obligation of
Holdings, the Borrower and such Loan Party to the extent a party
thereto enforceable against such Loan Party in accordance with its
terms, except as enforceability may be limited by bankruptcy,
insolvency, moratorium, reorganization or other similar laws affecting
creditors' rights generally and except as enforceability may be
limited by general principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at law).
F. INCORPORATION OF REPRESENTATIONS AND WARRANTIES FROM CREDIT AGREEMENT.
The representations and warranties contained in Article III of the
Amended Agreement are and will be true, correct and complete in all
material respects on and as of the First Amendment Effective Date to
the same extent as though made on and as of that date, except to the
extent such representations and warranties specifically relate to an
earlier date, in which case they were true, correct and complete in
all material respects on and as of such earlier date.
G. ABSENCE OF DEFAULT. No event has occurred and is continuing or will
result from the consummation of the transactions contemplated by this
Amendment that would constitute an Event of Default or a Default.
SECTION 4. ACKNOWLEDGMENT AND CONSENT
Each of Events Center Catering, Inc., Service America Concessions
Corporation, Service America Corporation, Service America Corporation of
Wisconsin, Servo Canada Inc., Servo-Kansas, Inc., Servomation Duchess, Inc.,
Volume Services, Inc. and Volume Services, Inc. (Kansas) is a party to the
Subsidiary Guarantee Agreement and Security Agreement, in each case as amended
through the First Amended Effective Date, pursuant to which each of Events
Center Catering, Inc., Service America Concessions Corporation, Service America
Corporation, Service America Corporation of Wisconsin, Servo Canada Inc.,
Servo-Kansas, Inc., Servomation Duchess, Inc., Volume Services, Inc. and Volume
Services, Inc. (Kansas) has (i) guarantied the Obligations and (ii) created
Liens in favor of Lenders on certain Collateral to secure its obligations under
the Subsidiary Guarantee Agreement. Events Center Catering, Inc., Service
America Concessions Corporation, Service America Corporation, Service America
Corporation of Wisconsin, Servo Canada Inc., Servo-Kansas, Inc., Servomation
Duchess, Inc., Volume Services, Inc. and Volume Services, Inc. (Kansas) are
collectively referred to herein as the "Credit Support Parties", and the
Subsidiary Guarantee Agreement and the Security Agreement are collectively
referred to herein as the "Credit Support Documents".
Each Credit Support Party hereby acknowledges that it has reviewed the
terms and provisions of the Credit Agreement and this Amendment and consents to
the amendment of the Credit Agreement effected pursuant to this Amendment. Each
Credit Support Party hereby confirms that each Credit Support Document to which
it is a party or otherwise bound and all Collateral
13
encumbered thereby will continue to guarantee or secure, as the case may be, to
the fullest extent possible in accordance with the Credit Support Documents the
payment and performance of all "Obligations" under each of the Subsidiary
Guarantee Agreement and Security Agreement, as the case may be (in each case as
such terms are defined in the applicable Credit Support Document), including
without limitation the payment and performance of all such "Obligations" under
each of the Subsidiary Guarantee Agreement and Security Agreement, as the case
may be, in respect of the Obligations of Borrower now or hereafter existing
under or in respect of the Amended Agreement and the Notes defined therein.
Each Credit Support Party acknowledges and agrees that any of the Credit
Support Documents to which it is a party or otherwise bound shall continue in
full force and effect and that all of its obligations thereunder shall be valid
and enforceable and shall not be impaired or limited by the execution or
effectiveness of this Amendment. Each Credit Support Party represents and
warrants that all representations and warranties contained in the Amended
Agreement and the Credit Support Documents to which it is a party or otherwise
bound are true, correct and complete in all material respects on and as of the
First Amendment Effective Date to the same extent as though made on and as of
that date, except to the extent such representations and warranties specifically
relate to an earlier date, in which case they were true, correct and complete in
all material respects on and as of such earlier date.
Each Credit Support Party acknowledges and agrees that (i) notwithstanding
the conditions to effectiveness set forth in this Amendment, such Credit Support
Party is not required by the terms of the Credit Agreement or any other Loan
Document to consent to the amendments to the Credit Agreement effected pursuant
to this Amendment and (ii) nothing in the Credit Agreement, this Amendment or
any other Loan Document shall be deemed to require the consent of such Credit
Support Party to any future amendments to the Credit Agreement.
SECTION 5. MISCELLANEOUS
A. REFERENCE TO AND EFFECT ON THE CREDIT AGREEMENT AND THE OTHER LOAN
DOCUMENTS.
----------
(i) On and after the First Amendment Effective Date, each reference in the
Credit Agreement to "this Agreement", "hereunder", "hereof", "herein"
or words of like import referring to the Credit Agreement, and each
reference in the other Loan Documents to the "Credit Agreement",
"thereunder", "thereof" or words of like import referring to the
Credit Agreement shall mean and be a reference to the Credit Agreement
as amended by this Amendment.
(ii) Except as specifically amended by this Amendment, the Credit Agreement
and the other Loan Documents shall remain in full force and effect and
are hereby ratified and confirmed.
14
(iii)The execution, delivery and performance of this Amendment shall not,
except as expressly provided herein, constitute a waiver of any
provision of, or operate as a waiver of any right, power or remedy of
any Agent or Lender under, the Credit Agreement or any of the other
Loan Documents.
B. HEADINGS. Section and Subsection headings in this Amendment are included
---------
herein for convenience of reference only and shall not constitute a part of
this Amendment for any other purpose or be given any substantive effect.
C. APPLICABLE LAW. THIS AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF THE
---------- ----
PARTIES HEREUNDER SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED
IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK (INCLUDING
WITHOUT LIMITATION SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAW OF THE
STATE OF NEW YORK), WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES.
D. COUNTERPARTS. This Amendment may be executed in any number of counterparts
-------------
and by different parties hereto in separate counterparts, each of which
when so executed and delivered shall be deemed an original, but all such
counterparts together shall constitute but one and the same instrument;
signature pages may be detached from multiple separate counterparts and
attached to a single counterpart so that all signature pages are physically
attached to the same document.
[Remainder of page intentionally left blank]
15
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
duly executed and delivered by their respective officers thereunto duly
authorized as of the date first written above.
BORROWER: VOLUME SERVICES AMERICA, INC.
By:
Name:
Title:
HOLDINGS: VOLUME SERVICES AMERICA HOLDINGS, INC.
By:
Name:
Title:
CREDIT SUPPORT
PARTIES: EVENTS CENTER CATERING, INC.
(for the purposes of Section 4 only)
as a Credit Support Party
By:
Name:
Title:
SERVICE AMERICA CONCESSIONS CORPORATION
(for the purposes of Section 4 only)
as a Credit Support Party
By:
Name:
Title:
SERVICE AMERICA CORPORATION
(for the purposes of Section 4 only)
as a Credit Support Party
By:
Name:
Title:
S - 1
SERVICE AMERICA CORPORATION OF
WISCONSIN
(for the purposes of Section 4 only)
as a Credit Support Party
By:
Name:
Title:
SERVO CANADA INC.
(for the purposes of Section 4 only)
as a Credit Support Party
By:
Name:
Title:
SERVO-KANSAS, INC.
(for the purposes of Section 4 only)
as a Credit Support Party
By:
Name:
Title:
SERVOMATION DUCHESS, INC.
(for the purposes of Section 4 only)
as a Credit Support Party
By:
Name:
Title:
VOLUME SERVICES, INC.
(for the purposes of Section 4 only)
as a Credit Support Party
By:
Name:
Title:
S - 2
VOLUME SERVICES, INC. (KANSAS)
(for the purposes of Section 4 only)
as a Credit Support Party
By:
Name:
Title:
LENDERS XXXXXXX XXXXX CREDIT PARTNERS L.P.,
AND AGENTS: as Lender and as a Joint Lead
Arranger and the Syndication Agent
By:
Authorized Signatory
CHASE MANHATTAN BANK DELAWARE,
as the Fronting Bank
By:
Name:
Title:
THE CHASE MANHATTAN BANK
as a Lender, the Swing Line Lender
and the Administrative Agent
By:
Name:
Title:
S - 3
FIRST UNION NATIONAL BANK
as a Lender
By:
Name:
Title:
UNION BANK OF CALIFORNIA, N.A.
as a Lender
By:
Name:
Title:
BANKBOSTON N.A.
as a Lender
By:
Name:
Title:
BHF-BANK AKTIENGESELLSCHAFT
as a Lender
By:
Name:
Title:
S - 4
BALANCED HIGH-YIELD FUND I LTD.
as a Lender
By: BHF-BANK AKTIENGESELLSCHAFT,
acting through its New York
Branch, as attorney-in-fact
By: _______________________________
Name:
Title:
By: _______________________________
Name:
Title:
CREDIT LYONNAIS
NEW YORK BRANCH
as a Lender
By:
Name:
Title:
THE BANK OF NOVA SCOTIA
as a Lender
By:
Name:
Title:
THE FUJI BANK, LIMITED,
NEW YORK BRANCH
as a Lender
By:
Name:
Title:
S - 5
NATIONSBANK, N.A.
as a Lender
By:
Name:
Title:
CERES FINANCE, LTD.
as a Lender
By: ____________________
Name:
Title:
DRESDNER BANK AG
as a Lender
By: ________________________
Name:
Title:
By: ________________________
Name:
Title:
XXXXX XXXXX SENIOR INCOME TRUST
as a Lender
By: Xxxxx Xxxxx Management, as
Investment Advisor
By: __________________________
Name:
Title:
S - 6
INDOSUEZ CAPITAL FUNDING IIA,
LIMITED
as a Lender
By: Indosuez Capital Luxembourg,
as Collateral Manager
By: _____________________________
Name:
Title:
INDOSUEZ CAPITAL FUNDING IV, L.P.
as a Lender
By: Indosuez Capital Luxembourg,
as Collateral Manager
By: _____________________________
Name:
Title:
KZH III LLC
as a Lender
By: _______________________
Name:
Title:
KZH RIVERSIDE LLC
as a Lender
By: _______________________
Name:
Title:
S - 7
KZH STERLING LLC
as a Lender
By: _______________________
Name:
Title:
KZH ING-2 LLC
as a Lender
By: _______________________
Name:
Title:
KEYPORT LIFE INSURANCE COMPANY
as a Lender
By: Xxxxx Xxx & Xxxxxxx
Incorporated, as agent
for Keyport Life Insurance
Company
By: ______________________________
Name:
Title:
XXXXXX XXXXXXX XXXX XXXXXX PRIME
INCOME TRUST
as a Lender
By: _________________________
Name:
Title:
S - 8
XXXXXXX XXXXX PRIME RATE
PORTFOLIO
as a Lender
By: Xxxxxxx Xxxxx Asset Management, L.P.
as Investment Advisor
By: _______________________________
Name:
Title:
XXXXXXX XXXXX SENIOR FLOATING
RATE FUND, INC.
as a Lender
By: ___________________________
Name:
Title:
METROPOLITAN LIFE INSURANCE
COMPANY
as a Lender
By: ______________________________
Name:
Title:
MOUNTAIN CLO TRUST
as a Lender
By: ____________________________
Name:
Title:
S - 9
NATIONAL WESTMINSTER BANK, PLC
as a Lender
By: NatWest Capital Markets Limited,
its Agent
By: Greenwich Capital Markets, Inc., its
Agent
By: _________________________
Name:
Title:
OASIS COLLATERALIZED HIGH INCOME
PORTFOLIOS-I, LTD.
as a Lender
By: ______________________________
Name:
Title:
SENIOR DEBT PORTFOLIO
as a Lender
By: Boston Management and Research,
as Investment Advisor
By: ______________________________
Name:
Title:
XXX XXXXXX PRIME RATE INCOME
TRUST
as a Lender
By: _____________________________
Name:
Title:
S - 10
THE TRAVELERS INSURANCE COMPANY
as a Lender
By: ______________________________
Name:
Title:
S - 11
