XXXX-XXXXX COMPANY
THIRD AMENDMENT TO CREDIT AGREEMENT
Xxxxxx Trust and Savings Bank,
as Administrative Agent
Chicago, Illinois
Other Banks party to the
Credit Agreement
Ladies and Gentlemen:
We refer to the Credit Agreement dated as of October 8, 1996 (such Credit
Agreement, as heretofore amended and as may be amended from time to time, being
hereinafter referred to as the "CREDIT AGREEMENT") and currently in effect
between you and us. Capitalized terms used without definition below shall have
the same meanings herein as they have in the Credit Agreement.
The Borrower has requested that the Banks make certain modifications to the
borrowing arrangements provided for in the Credit Agreement and the Banks have
agreed to accommodate such request by the Borrower on the terms and conditions
herein set forth.
1. AMENDMENTS
Upon satisfaction of the conditions precedent to effectiveness set forth
below, the Credit Agreement shall be amended as follows:
SECTION 1.01. NEW DEFINITIONS. Section 6.1 of the Credit Agreement shall
be amended by inserting the following new definitions in the appropriate
alphabetical location:
`SENIOR FUNDED DEBT' means, as of any time the same is to be
determined, Total Funded Debt other than the Senior Subordinated Debt.
`SENIOR LEVERAGE RATIO' means, as of any time the same is to be
determined, the ratio of Senior Funded Debt at such time to EBITDA for
the then four most recently completed fiscal quarters of the Borrower.
`SENIOR SUBORDINATED DEBT' means any debt securities to be issued by
the Borrower substantially concurrent with the satisfaction of all of
the conditions precedent set forth in Section 3 of the Third Amendment
to this Agreement on the terms, or on substantially the same terms but
in no event more burdensome on the Borrower in
any material respect than the terms, in each case contained in the
February 23, 1998, 5:41 p.m. draft of the Description of Notes to
be included in the Offering Memorandum for such debt securities
(the "SUBORDINATED NOTE DESCRIPTION") which has previously been
forwarded to the Banks; PROVIDED, HOWEVER, that (i) such debt
securities shall bear interest prior to maturity or default at a
rate per annum not exceeding 12% per annum; (ii) such debt
securities shall not be subject to any call or similar option to
require mandatory prepayment (other than (A) by reason of a "CHANGE
OF CONTROL" as such term is defined in the Subordinated Note
Description and (B) in the case of an "ASSET SALE" as such term is
defined in the Subordinated Note Description) at any time prior to
five calendar years following the issuance of such debt securities;
(iii) such debt securities shall not require (other than upon the
occurrence of any "EVENT OF DEFAULT" as such term is defined in the
Subordinated Note Description) any scheduled payment or prepayment
of principal thereon, or any scheduled acquisition or retirement
thereof by the issuer, in each case prior to ten calendar years
following the issuance of such debt securities; (iv) no covenant
relating to the financial performance or financial condition of the
Borrower or any Subsidiary shall govern the maturity or
amortization of such debt securities other than the financial
covenant described in the Subordinated Note Description that would
prohibit the Borrower and its Subsidiaries from incurring
additional Indebtedness (other than (A) the Obligations, (B)
Indebtedness outstanding as of the date of issuance of such debt
securities, and (C) the other Indebtedness which the Subordinated
Note Description states will be permitted whether or not the
Borrower is in compliance with such financial covenant) if the
Consolidated Fixed Charge Coverage Ratio (as such term is defined
in the Subordinated Note Description) were, after giving effect to
such incurrence, less than a level that is no higher than 2.25 to
1; and (v) the proceeds of such debt securities are used solely for
any one or more of the following: (A) the prepayment (including any
applicable prepayment premiums) of the Existing NF Term Debt and
the Existing Super Food Debt, (B) the payment of reasonable fees,
commissions and underwriting discounts directly incurred and
payable by the Borrower in connection with the issuance of the
Senior Subordinated Debt and (C) the prepayment of the Loans
hereunder.
SECTION 1.02. The definition of "EXISTING DEBT" appearing in Section 6.1
of the Credit Agreement shall be amended by inserting the following sentence
immediately at the end thereof:
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"Any reference in this Agreement to any Existing Debt shall be
deemed a reference to such Existing Debt as listed on the relevant
Exhibit attached hereto, as the same may from time to time be modified
or amended (but without any increase in the principal amount
thereof)."
SECTION 1.03. NEW LIMITS ON AGGREGATE INDEBTEDNESS. Section 9.12 of the
Credit Agreement shall be amended in its entirety and as so amended shall be
restated to read as follows:
"SECTION 9.12. LIMIT ON AGGREGATE INDEBTEDNESS. The Borrower
shall not permit any Subsidiary to issue, incur, assume, create or
have outstanding any Indebtedness (other than (i) intercompany
Indebtedness owed to the Borrower or any other Subsidiary, (ii)
liabilities of the Subsidiaries under the Subsidiary Guarantee
Agreements, (iii) liabilities of the Subsidiaries on their
Guarantees of the Senior Subordinated Debt and (iv) liabilities
incurred in connection with securitization transactions permitted
by Section 9.15 hereof) aggregating more than 5% of Total Assets."
SECTION 1.04. SUBSIDIARY GUARANTEES. Section 9.14 of the Credit Agreement
is hereby amended by adding thereto a new sentence immediately at the end
thereof which reads as follows:
"Notwithstanding anything contained herein to the contrary,
nothing contained in this Section 9.14 shall operate to prohibit
the execution by the Subsidiaries of Guarantees of the Senior
Subordinated Debt if and so long as any and all of the holders'
claims for payment on such Guarantees are subordinated in right of
payment to the prior payment of the Loans and other obligations
under the Loan Documents on the same or substantially the same
terms as the Senior Subordinated Debt."
SECTION 1.05. SPECIAL PURPOSE VEHICLE. Section 9.1 of the Credit
Agreement is hereby amended by adding thereto a new sentence immediately at the
end thereof which reads as follows:
"Notwithstanding anything contained herein to the contrary,
neither Xxxx-Xxxxx Funding Corp. nor any other Subsidiary of the
Borrower shall be required to execute a Subsidiary Guarantee
Agreement if and so long as the sole purpose and function of such
Subsidiary is to act as a special purpose vehicle for a
securitization or other similar transaction permitted by Section
9.15 hereof involving accounts receivable of, or loans owed to, the
Borrower or any other Subsidiary."
SECTION 1.06. NEW LEVERAGE RATIO LEVELS. Section 9.9 of the Credit
Agreement shall be amended and as so amended shall be restated in its entirety
to read as follows:
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"SECTION 9.9. LEVERAGE RATIO. The Borrower shall not, as of
the close of any fiscal quarter of the Borrower set forth below,
permit the Leverage Ratio to be more than the amount set forth to
the right of such quarter:
As of Close of each Fiscal Quarter:
Leverage Ratio Shall
From and Including To and Including Not be More Than:
------------------ ---------------- -----------------
1st fiscal quarter of 3rd fiscal quarter of 4.75 to 1
fiscal year 1998 fiscal year 1998
4th fiscal quarter of 1st fiscal quarter of 4.50 to 1
fiscal year 1998 fiscal year 1999
2nd fiscal quarter of 1st fiscal quarter of 4.25 to 1
fiscal year 1999 fiscal year 2000
2nd fiscal quarter of each fiscal quarter 4.00 to 1
fiscal year 2000 thereafter
SECTION 1.07. NEW INTEREST COVERAGE RATIO LEVELS. Section 9.10 shall be
amended and as so amended shall be restated in its entirety to read as follows:
SECTION 9.10. INTEREST COVERAGE RATIO. The Borrower shall
not, as of the close of any fiscal quarter of the Borrower set
forth below, permit the Interest Coverage Ratio to be less than the
amount set forth to the right of such period:
As of Close of each Fiscal Quarter:
Interest Coverage Ratio
Shall
From and Including To and Including Not be Less Than:
------------------ ---------------- -----------------
1st fiscal quarter of 1st fiscal quarter of 2.50 to 1
fiscal year 1998 fiscal year 2000
2d fiscal quarter of each fiscal quarter 2.75 to 1
fiscal year 2000 thereafter
SECTION 1.08 SECURITIZATION OF LOANS RECEIVABLE. Section 9.15 of the
Credit Agreement shall be amended by inserting the following new sentence
immediately at the end thereof:
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"Notwithstanding the foregoing, this Section shall neither apply
to nor operate to prohibit the sale by the Borrower or any Subsidiary
of loans receivable owing the Borrower and its Subsidiaries in the
ordinary course of their business to Persons other than Affiliates
provided that (i) such sale is part of a securitization or similar
financing transaction and (ii) the aggregate face amount of loans
receivable sold and outstanding at any one time, when taken together
with the aggregate face amount of accounts receivable sold and
outstanding pursuant to securitization or similar financing
transactions permitted by Section 9.15 above, does not exceed
$75,000,000.
SECTION 1.09. RESTRICTED PAYMENT OF SUB DEBT. Section 9 of the Credit
Agreement shall be amended by adding thereto a new Section 9.21 which reads as
follows:
"SECTION 9.21. SUB DEBT PAYMENTS. The Company will not, and will
not permit any Subsidiary to, directly or indirectly make any payment
or other distribution on or in respect of any principal, interest or
premium, if any, of any of the Senior Subordinated Debt or otherwise
acquire, prepay or retire any of such indebtedness (such payments,
distributions, acquisitions, prepayments or retirements being
hereinafter referred to collectively as "SUB DEBT PAYMENTS") if:
(x) such Sub Debt Payment would be made prior to the
scheduled maturity thereof or prior to any other times required
for payment thereof as are in force and effect as of the date of
issuance of such Indebtedness; or
(y) such Sub Debt Payment would be prohibited under the
terms of any instrument subordinating such indebtedness to the
prior payment of the Loans or any of the other obligations under
the Loan Documents;
PROVIDED, HOWEVER, that the immediately preceding clause (x) of this
Section shall not prohibit (A) a Sub Debt Payment consisting of the
Company's exercise of the option described in the Offering Memorandum
for its redemption of the Senior Subordinated Debt out of the proceeds
of, and substantially concurrent with, the Borrower's issuance and
sale through an underwritten public offering of its capital stock
provided that (i) not more than 50% of the net proceeds of such
offering (net proceeds for such purposes to mean a gross proceeds of
such offering net of reasonable underwriting discounts and commissions
and other reasonable costs directly incurred and payable as a result
of such offering) are so used, (ii) not more than 35% of the Senior
Subordinated Debt then
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outstanding is so prepaid and (iii) at the time of such Sub Debt
Payment and immediately after giving effect thereto, no Default or
Event of Default shall occur or be continuing and (B) Sub Debt
Payments out of the proceeds of Asset Sales (as defined in the
Subordinated Note Description) as and to the extent described in
the Subordinated Note Description provided that at the time of each
such Sub Debt Payment and immediately after giving effect thereto, no
Default or Event of Default shall occur or be continuing."
SECTION 1.10. NEW SENIOR LEVERAGE RATIO. Section 9 of the Credit
Agreement shall be amended by adding thereto a new Section 9.22 which reads
as follows:
SECTION 9.22. SENIOR LEVERAGE RATIO. The Borrower shall not, as
of the close of any fiscal quarter of the Borrower set forth below,
permit the Senior Leverage Ratio to be more than the amount set forth
to the right of such period:
As of Close of each Fiscal Quarter:
Senior Leverage Ratio
Shall
From and Including To and Including Not be More Than:
------------------ ---------------- -----------------
1st fiscal quarter of 1st fiscal quarter of 3.50 to 1
fiscal year 1998 fiscal year 1999
2nd fiscal quarter of 1st fiscal quarter of 3.25 to 1
fiscal year 1999 fiscal year 2000
2nd fiscal quarter of each fiscal quarter 3.00 to 1
fiscal year 2000 thereafter
SECTION 1.11. NEW INTEREST COVERAGE RATIO DEFINITION. The definition
of "INTEREST COVERAGE RATIO" appearing in Section 6.1 of the Credit Agreement
shall be amended in its entirety and as so amended shall be restated to read
as follows:
"`INTEREST COVERAGE RATIO' means, for any period of four
consecutive fiscal quarters of the Borrower ending with the most
recently completed such fiscal quarter, the ratio of EBITDA to
Interest Expense for such period."
SECTION 1.12. ADDITIONAL CHANGE OF CONTROL. The definition of "CHANGE OF
CONTROL" appearing in Section 6.1 of the Credit Agreement shall be amended by
inserting the following new sentence immediately at the end thereof:
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"A "CHANGE OF CONTROL" shall also include each similar event
(including for such purposes, any event similarly defined) entitling
any holder of the Senior Subordinated Debt to accelerate its maturity
or require its purchase prior to scheduled maturity by the Borrower or
any Subsidiary."
SECTION 1.13. CONSOLIDATED NET INCOME. The definition of the term
"CONSOLIDATED NET INCOME" in Section 6.1 of the Credit Agreement shall be
amended by inserting the following immediately at the end thereof:
"The foregoing to the contrary notwithstanding, for purposes of
determining Consolidated Net Income for each period which includes the
third fiscal quarter of the Borrower for its 1997 fiscal year,
Consolidated Net Income shall not include a deduction for the Third
Quarter 1997 Charge."
2. REDUCTION OF COMMITMENTS.
By its execution hereof, each of the parties hereto acknowledges that the
Commitments have heretofore already been reduced to an aggregate amount equal to
$360,000,000 in accordance with the provisions of Section 3.6 of the Credit
Agreement, effective as of March 2, 1998.
3. CONDITIONS PRECEDENT.
The effectiveness of this Amendment is subject to the satisfaction of
all of the following conditions precedent:
(a) The Borrower and the Required Banks shall have executed this
Amendment.
(b) The Borrower shall have received gross proceeds from the issuance
of the Senior Subordinated Debt in an amount not less than $140,000,000 and
the Administrative Agent shall have received assurances reasonably
satisfactory to it of the foregoing.
(c) Legal matters incident to the Borrower's issuance of the Senior
Subordinated Debt shall be satisfactory to the Required Banks and their
counsel.
(d) Legal matters incident to the execution and delivery of this
Amendment shall be satisfactory to the Required Banks and their counsel.
Notwithstanding the foregoing, Sections 1.03 and 1.05 of this Amendment shall be
effective as of December 1, 1997 upon satisfaction of the conditions precedent
set forth in Sections 3(a) and 3(d) above.
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4. REPRESENTATIONS REAFFIRMED.
In order to induce the Banks to execute and deliver this Agreement, the
Borrower hereby represents to the Banks that as of the date hereof and as of the
time that this Amendment becomes effective, each of the representations and
warranties set forth in Section 7 of the Credit Agreement, after giving effect
to the amendments made hereby, are and shall be true and correct (except that
the representations contained in Section 7.4 shall be deemed to refer to the
most recent financial statements of the Borrower delivered to the Banks).
5. MISCELLANEOUS.
This Amendment may be executed in any number of counterparts and by
different parties hereto on separate counterparts, each of which when so
executed shall be an original but all of which shall constitute one and the same
instrument. Except as specifically amended and modified hereby, all of the
terms and conditions of the Credit Agreement shall stand and remain unchanged
and in full force and effect. No reference to this Amendment need be made in
any note, instrument or other document making reference to the Credit Agreement,
any reference to the Credit Agreement in any such note, instrument or other
document to be deemed to be a reference to the Credit Agreement as amended
hereby. The Borrower confirms its agreement to pay the reasonable fees and
disbursements of Messrs. Xxxxxxx and Xxxxxx, counsel to the Administrative
Agent, in connection with the preparation, execution and delivery of this
Amendment and the transactions and documents contemplated hereby. This
instrument shall be construed and governed by and in accordance with the laws of
the State of Illinois (without regard to principles of conflicts of laws).
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Dated as of this 23rd day of March, 1998.
XXXX-XXXXX COMPANY
By
--------------------------------
Name:
---------------------------
Title:
--------------------------
Accepted and agreed to as of the date last above written.
XXXXXX TRUST AND SAVINGS BANK, in
its individual capacity as a Bank
and as Administrative Agent
By /s/ [ILLEGIBLE]
--------------------------------
Its Vice President
PNC BANK, NATIONAL ASSOCIATION
By /s/ Xxxxx X. Xxxxx
--------------------------------
Its Assistant Vice President
-----------------------------
ABN AMRO BANK N.V.
By
--------------------------------
Its
-----------------------------
By
--------------------------------
Its
-----------------------------
THE BANK OF TOKYO-MITSUBISHI, LTD.,
CHICAGO BRANCH
By /s/ [ILLEGIBLE]
--------------------------------
Its [ILLEGIBLE]
-----------------------------
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CIBC Inc.
By /s/ [ILLEGIBLE]
--------------------------------
Its [ILLEGIBLE]
-----------------------------
ISTITUTO BANCARIO SANPAOLO DI
TORINO SPA
By
--------------------------------
Its
-----------------------------
KEYBANK, N.A.
By /s/ [ILLEGIBLE]
--------------------------------
Its Vice President
-----------------------------
COMMERZBANK AKTIENGESELLSCHAFT
CHICAGO BRANCH
By /s/ [ILLEGIBLE]
--------------------------------
Its [ILLEGIBLE]
-----------------------------
By /s/ [ILLEGIBLE]
--------------------------------
Its [ILLEGIBLE]
-----------------------------
CREDIT LYONNAIS, CHICAGO BRANCH
By
--------------------------------
Its
-----------------------------
THE FUJI BANK, LIMITED
By /s/ [ILLEGIBLE]
--------------------------------
Its Joint General Manager
-----------------------------
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CAISSE NATIONALE DE CREDIT AGRICOLE
By
--------------------------------
Its
-----------------------------
FIRST BANK NATIONAL ASSOCIATION
By /s/ [ILLEGIBLE]
--------------------------------
Its Vice President
-----------------------------
MELLON BANK, N.A.
By /s/ Xxxxxx X. Xxxxxx
--------------------------------
Its Assistant Vice President
-----------------------------
THE SAKURA BANK, LIMITED
By
--------------------------------
Its
-----------------------------
SUNTRUST BANK, ATLANTA
By /s/ [ILLEGIBLE]
--------------------------------
Its Vice President
-----------------------------
THE MITSUBISHI TRUST AND BANKING
CORPORATION
By /s/ [ILLEGIBLE]
--------------------------------
Its Chief Manager
-----------------------------
NATIONAL CITY BANK OF COLUMBUS
By /s/ [ILLEGIBLE]
--------------------------------
Its Vice President
-----------------------------
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THE SANWA BANK, LIMITED
By /s/ Xxxxxxx X. Xxxxxxxx
--------------------------------
Its First Vice President and
Assistant General Manager
-----------------------------
THE SUMITOMO BANK, LIMITED
By /s/ Xxx Xxxxxx Xxxxxxxxx
--------------------------------
Its Joint General Manager
-----------------------------
BANKERS TRUST COMPANY
By /s/ Xxxxx Xxxxxx
--------------------------------
Its Vice President
-----------------------------
THE BANK OF NEW YORK
By /s/ [ILLEGIBLE]
--------------------------------
Its Vice President
-----------------------------
MITSUI TRUST AND BANKING COMPANY,
LIMITED
By /s/ Xxxxxxxx Xxxxxxxx
--------------------------------
Its Vice President & Manager
-----------------------------
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