[Execution Copy]
AMENDED AND RESTATED
REVOLVING CREDIT AGREEMENT
Dated as of September 15, 1997
Among
JITNEY-JUNGLE STORES OF AMERICA, INC.,
SOUTHERN JITNEY JUNGLE COMPANY,
XxXXXXX- XXXXXX CO., INC.,
JITNEY- JUNGLE BAKERY, INC.,
PUMP AND SAVE, INC.,
INTERSTATE JITNEY JUNGLE STORES, INC.,
DELTA ACQUISITION CORPORATION,
DELCHAMPS, INC.,
THE GUARANTORS NAMED HEREIN,
THE LENDERS NAMED HEREIN,
DLJ CAPITAL FUNDING, INC., AS DOCUMENTATION AGENT
and
FLEET CAPITAL CORPORATION, AS AGENT
AMENDED AND RESTATED REVOLVING CREDIT AGREEMENT, dated as of
September 15, 1997, among JITNEY-JUNGLE STORES OF AMERICA, INC., a
Mississippi corporation ("Jitney Jungle"), SOUTHERN JITNEY JUNGLE
COMPANY, a Mississippi corporation and a wholly-owned subsidiary of
Jitney Jungle ("Southern Jitney"), XxXXXXX-XXXXXX CO., INC., a
Mississippi corporation and a wholly-owned subsidiary of Jitney
Jungle ("XxXxxxx-Xxxxxx"), JITNEY- JUNGLE BAKERY, INC., a
Mississippi corporation and a wholly-owned subsidiary of Jitney
Jungle ("Bakery"), PUMP AND SAVE, INC., a Mississippi corporation
and a wholly-owned subsidiary of XxXxxxx-Xxxxxx ("Pump And Save"),
INTERSTATE JITNEY JUNGLE STORES, INC., an Alabama corporation and a
wholly-owned subsidiary of Jitney Jungle ("Interstate"), DELTA
ACQUISITION CORPORATION, an Alabama corporation and a wholly-owned
subsidiary of Jitney Jungle ("Acquisition Corp."), DELCHAMPS, INC.,
an Alabama corporation and upon the purchase of the Tendered
Securities on the date hereof and as contemplated hereby, a
subsidiary of Acquisition Corp. ("Delchamps" and together with
Jitney Jungle, Southern Jitney, XxXxxxx-Xxxxxx, Bakery, Pump And
Save, Interstate and Acquisition Corp., each a "Borrower" and
collectively, the "Borrowers"), the Guarantors signatory hereto, the
lenders named in Schedule 2.01 annexed hereto (collectively with
their respective permitted successors and assigns, the "Lenders"),
DLJ CAPITAL FUNDING, INC. ("DLJ"), as documentation agent for the
Lenders (in such capacity together with any successor thereto in
such capacity, the "Documentation Agent") and FLEET CAPITAL
CORPORATION ("Fleet"), as agent for the Lenders (in such capacity
together with any successor thereto in such capacity, the "Agent").
Capitalized terms used in this paragraph shall have the respective
meanings ascribed to such terms above or hereinafter.
Certain of the Borrowers and the Guarantors, all or some of the
Lenders (in such capacity, the "Existing Lenders"), and Fleet Bank, N.A.
(formerly known as NatWest Bank N.A.), as agent (in such capacity, the
"Existing Agent") are parties to the Revolving Credit Agreement, dated as of
March 5, 1996 (as heretofore amended and in effect on the date hereof,
together with the Exhibits and Schedules thereto, the
"Existing Credit Agreement"), providing for loans to be made to, and letters
of credit to be issued for the account of, the Borrowers in the aggregate
principal and/or face amount not exceeding $96,250,000 at any one time
outstanding. Immediately prior to the execution and delivery of this
Agreement, (i) Fleet succeeded to the position of the Existing Agent as Agent
under the Existing Credit Agreement and (ii) Fleet acquired from Fleet Bank,
a Lender under the Existing Credit Agreement, an assignment of its Commitment
and outstanding Loans thereunder.
The Borrowers have informed the Agent and the Lenders that they
desire to acquire the Target Stock of the Target Company upon the terms and
conditions set forth herein and in the Merger Documents and the Tender Offer
Documents. In connection therewith, the Borrowers have jointly and severally
applied to the Lenders for Loans on a revolving basis up to an aggregate
principal amount of $150,000,000 to be made at any time and from time to time
prior to the Termination Date. The proceeds of the Loans shall be used by
the Borrowers (i) to refinance the Indebtedness under the Existing Credit
Agreement outstanding on the Initial Closing Date on the terms set forth
herein, (ii) to provide a portion of the funds necessary (but not to exceed
$0) for the tender offer consideration pursuant to the Tender Offer on the
Initial Closing Date, (iii) to provide a portion of the funds necessary (but
not to exceed $24,500,000) for the merger consideration payable under the
Merger Agreement in connection with the merger of Acquisition Corp. with and
into the Target Company on the Merger Closing Date, (iv) to repay certain
Indebtedness of the Target Company and its subsidiaries outstanding on the
Initial Closing Date (but not to exceed $16,225,000), (v) to pay fees and
expenses in connection with the financing contemplated hereby and the
transactions contemplated by the Merger Agreement (but not to exceed
$27,000,000) and (vi) for the working capital and general corporate purposes
of the Borrowers to the extent that such purposes are permitted hereunder.
The Lenders are severally, and not jointly, willing to extend such Loans to
the Borrowers subject to the terms and conditions hereinafter set forth.
Accordingly, the Borrowers, the Guarantors, the Lenders and the Agent hereby
agree to amend and restate the Existing Credit Agreement as follows:
I. DEFINITIONS
For purposes hereof, the following terms shall have the meanings
specified below:
"Acquisition" shall mean, collectively, the transactions contemplated
under the Merger Agreement which will result in the Merger.
"Acquisition Corp." shall have the meaning assigned to such term in
the preamble to this Agreement.
"Acquisition Securities" shall mean the Common Stock of Jitney Jungle,
15% Class A Senior Exchangeable Preferred Stock of Jitney Jungle, 10% Class B
Compounding Cumulative Redeemable Preferred Stock of Jitney Jungle, 10% Class
C Compounding Cumulative Redeemable Preferred Stock of Jitney Jungle, the
Senior Notes and the Warrants to Purchase Common Stock of Jitney Jungle, each
with such terms, rights and premiums as in effect on the Original Closing
Date, except with respect to the Senior Notes, which shall be with such
terms, rights and premiums as in effect on the Initial Closing Date.
"Adjusted LIBO Rate" shall mean, with respect to any Eurodollar Loan
for any Interest Period, an interest rate per annum (rounded upwards, if
necessary, to the next 1/16 of 1%) equal to the product of (i) the LIBO Rate
in effect for such Interest Period and (ii) Statutory Reserves. For purposes
hereof, "Statutory Reserves" shall mean a fraction (expressed as a decimal),
the numerator of which is the number one and the denominator of which is the
number one minus the aggregate of the maximum reserve percentages (including,
without limitation, any marginal, special, emergency, or supplemental
reserves) expressed as a decimal established by the Board and any other
banking authority to which any Lender is subject with respect to the Adjusted
LIBO Rate for Eurocurrency Liabilities (as defined in Regulation D). Such
reserve percentages shall include, without limitation, those imposed under
Regulation D. Eurodollar Loans shall be deemed to constitute Eurocurrency
Liabilities and as such shall be deemed to be subject to such reserve
requirements without benefit of or credit for proration, exceptions or
offsets which may be available from time to time to any Lender under
Regulation D. Statutory Reserves shall be adjusted automatically on and as
of the effective date of any change in any reserve percentage.
"Affiliate" of any person shall mean any other person which,
directly or indirectly, controls or is controlled by or is under common
control with such person and, without limiting the generality of the
foregoing, includes (i) any other person which beneficially owns or holds 5%
or more of any class of voting securities of such person or 5% or more of the
equity interest in such person, (ii) any person of which such person
beneficially owns or holds 5% or more of any class of voting securities or in
which such person beneficially owns or holds 5% or more of the equity
interest in such person and (iii) any director, officer or partner of such
person. For the purposes of this definition, the term "control" (including,
with correlative meanings, the terms "controlled by" and "under common
control with"), as used with respect to any person, means the possession,
directly or indirectly, of the power to direct or cause the direction of the
management and policies of such person, whether through the ownership of
voting securities or by contract or otherwise.
"Agent" shall have the meaning assigned to such term in the preamble
to this Agreement.
"Aircraft" shall have the meaning assigned to such term in the
Chattel Mortgage.
"Anticipated Reinvestment Amount" shall mean, with respect to any
Reinvestment Election, the amount specified in the Reinvestment Notice
delivered by the relevant Borrower in connection therewith as the amount of
the Net Cash Proceeds from the related Asset Sale that such Borrower intends
to use to purchase, construct or otherwise acquire Reinvestment Assets.
"Applicable Lending Office" shall mean, with respect to each
Lender, such Lender's Domestic Lending Office in the case of a Base Rate Loan
and such Lender's Eurodollar Lending Office in the case of a Eurodollar Loan.
"Applicable Margin" shall mean, from the Initial Closing Date
through the Initial Adjustment Date, (i) in the case of Loans which are Base
Rate Loans, three-quarters of one percent (0.75%), and (ii) in the case of
Loans which are Eurodollar Loans, two percent (2.00%), and on and after the
Initial Adjustment Date (x) in the case of Loans which are Base Rate Loans,
one percent (1.00%), minus the then applicable Reduction Discount, if any,
and (y) in the case of Loans which are Eurodollar Loans, two and one-quarter
percent (2.25%), minus the then applicable Reduction Discount, if any.
"Asset Sale" shall mean the sale, transfer or other disposition by
any Borrower, any Guarantor or any subsidiary of any of them to any person
other than a Borrower or a Guarantor of any asset of such Borrower, such
Guarantor or such subsidiary (other than sales in the ordinary course of
business of inventory).
"Assignment and Acceptance" shall mean an assignment and acceptance
entered into by a Lender and an assignee and accepted by the Agent, in
substantially the form of Exhibit E annexed hereto.
"Assignment of Contract" shall mean the Assignment of Contract As
Collateral Security, dated as of March 5, 1996, as heretofore amended and as
amended and restated as of the date hereof among the Borrowers and the Agent,
for the benefit of the Secured Parties, substantially in the form of Exhibit
G, annexed hereto, as amended, modified or supplemented from time to time.
"Bakery" shall have the meaning assigned to this term in the
preamble to this Agreement.
"Base Rate" shall mean a variable rate of interest per annum equal
to the higher of (i) the Prime Rate then in effect and (ii) the Federal Funds
Effective Rate then in effect plus one-half of one percent (1/2%). Any
change in the Base Rate shall be effective hereunder on the effective date of
such change as determined by the Agent.
"Base Rate Loan" shall mean a Loan bearing interest based on the
Base
Rate in accordance with Article II hereof.
"Board" shall mean the Board of Governors of the Federal Reserve
System of the United States.
"Borrower" shall have the meaning assigned to such term in the
preamble to this Agreement.
"Borrowers" shall refer to all of the Borrowers on a collective
basis.
"Borrowing Base" shall have the meaning assigned to such term in
Section 2.01(a)(i) hereof.
"BRS" shall mean Bruckmann, Xxxxxx, Xxxxxxxx & Co., L.P., together
with its successors and assigns.
"Business Day" shall mean any day, other than a Saturday, Sunday or
legal holiday in the State of New York, on which banks are open for
substantially all their banking business in New York City, except that if any
determination of a "Business Day" shall relate to a Eurodollar Loan, the term
"Business Day" shall in addition exclude any day on which banks are not open
for dealings in dollar deposits in the London interbank market.
"Capital Expenditures" shall mean the amount of all purchases made
by the Borrowers or any of their respective subsidiaries directly or
indirectly for the purpose of acquiring, constructing or maintaining fixed
assets, real property or equipment which, in accordance with generally
accepted accounting principles, would be added as a debit to the fixed asset
account of any such Borrower or any such subsidiary (excluding fixed assets
acquired relating to Capitalized Lease Obligations and fixed assets acquired
pursuant to a financing permitted under Section 7.01(e) of this Agreement
(other than with respect to the down payment for such fixed assets))
including the acquisition cost of assets of any kind (but not the acquisition
cost paid for inventory) which are acquired in connection with an acquisition
or purchase permitted by this Agreement. For purposes of this definition,
the purchase price paid with respect to equipment, fixed assets or real
property which is purchased simultaneously with the trade-in or sale of
existing equipment, fixed assets, or real property owned by any Borrower or
any of its subsidiaries or with insurance proceeds (regardless of whether
such proceeds are first applied to prepay the Loans) or cash landlord/vendor
allowances shall be included in Capital Expenditures only to the extent of
the gross amount of such purchase price paid less the credit granted by the
seller of such equipment for the equipment being traded in at such time, the
purchase price of such existing equipment or the amount of such proceeds or
allowances, as the case may be.
"Capitalization Documents" shall mean, collectively: (i) any or
all of the stock certificates, notes or debentures representing Acquisition
Securities; (ii) the other documents pursuant to which such Acquisition
Securities are issued or to be issued; (iii) each document governing the
issuance of, or setting forth the terms of such Acquisition Securities; and
(iv) any stockholders or intercreditor agreement between or among the holders
of such Acquisition Securities, and all agreements, documents and instruments
executed and delivered pursuant thereto or in connection therewith, in each
case as in effect on the Original Closing Date and as amended, modified or
supplemented from time to time in accordance with the terms thereof and
subject to the terms of Section 7.18 hereof.
"Capitalized Lease Obligation" shall mean an obligation to pay rent
or other amounts under any lease of (or other arrangement conveying the right
to use) real and/or personal property which obligation is required to be
classified and accounted for as a capital lease on a balance sheet prepared
in accordance with generally accepted accounting principles, consistently
applied, and for purposes hereof the amount of such obligation shall be the
capitalized amount thereof determined in accordance with such principles.
"Cash Proceeds" shall mean, with respect to any Asset Sale, the
aggregate cash payments (including any cash received by way of deferred
payment pursuant to a note receivable issued in connection with such Asset
Sale, other than the portion of such deferred payment constituting interest,
but only as and when so received) received by a Borrower, a Guarantor or any
subsidiary of any of them from such Asset Sale.
"Change of Control" shall mean any of the following: (i) BRS shall
fail to own, beneficially and of record all voting rights with respect to, at
least 35% of all of the issued and outstanding shares of each class of voting
stock of Jitney Jungle, or (ii) BRS shall cease to own capital stock of
Jitney Jungle entitling it, at the time a determination is made hereunder, to
cast the votes required to elect a majority of members of the Board of
Directors of Jitney Jungle or (iii) Jitney Jungle shall fail to own,
beneficially and all voting rights with respect to, 100% of all of the issued
and outstanding shares of each class of capital stock of each of its
subsidiaries (other than the Target Company following the Tender Offer for
the Target Stock but prior to the Merger Closing Date), (iv) the occurrence
of a "Change of Control" (as such term is defined in the Senior Indenture)
under the Senior Indenture or (v) the occurrence of a "Change of Control" (as
such term is defined in the Senior Subordinated Indenture) under the Senior
Subordinated Indenture.
"Chattel Mortgage" shall mean the Chattel Mortgage - Security
Agreement, dated as of March 5, 1996, between the Grantor and the Agent, for
the benefit of the Secured Parties, as amended, modified or supplemented from
time to time.
"Code" shall mean the Internal Revenue Code of 1986, as amended from
time to time.
"Collateral" shall mean all collateral and security as described in
the Security Documents.
"Commitment" shall mean, with respect to each Lender, the Commitment
of such Lender as set forth in Schedule 2.01 annexed hereto, as it may be
adjusted from time to time pursuant to Section 2.07.
"Commitment Fee" shall mean, from the Initial Closing Date through
the Initial Adjustment Date, 0.425 percent (0.425%) per annum, and on and
after the Initial Adjustment Date, one-half of one percent (0.50%) per annum,
minus the then applicable Reduction Discount, if any.
"Commitment Letter" shall mean the letter agreement, dated July 7,
1997, by Fleet to Jitney Jungle, as in effect on the Initial Closing Date and
as amended, supplemented or modified from time to time in writing by Fleet
and Jitney Jungle.
"Consolidated" shall mean, in respect of any person, as applied to
any financial or accounting term, such term determined on a consolidated
basis in accordance with generally accepted accounting principles (except as
otherwise required herein) for the person and all consolidated subsidiaries
thereof.
"Credit Event" shall mean each borrowing of a Loan and each issuance
of a Letter of Credit hereunder.
"Default" shall mean any condition, act or event which, with notice
or lapse of time or both, would constitute an Event of Default.
"Delchamps" shall have the meaning assigned to this term in the
preamble to this Agreement.
"Documentation Agent" shall have the meaning assigned to this term
in the preamble to this Agreement.
"dollars" or the symbol "$" shall mean dollars in lawful currency of
the United States of America.
"Domestic Lending Office" shall mean, with respect to any Lender,
the office of such Lender specified as its "Domestic Lending Office" opposite
its name in Schedule 2.02 annexed hereto, or such other office of such Lender
as such Lender may from time to time specify to the Borrowers and the Agent.
"EBITDA" shall mean, for any period, the sum of (i) Net Income
(before any (A) extraordinary and non-recurring non-cash gains, (B)
extraordinary and non-recurring non-cash losses and (C) non-cash gains or
losses from assets held for sale), (ii) Interest Expense to the extent
deducted in determining Net Income for such period, (iii) depreciation and
amortization expense to the extent deducted in determining Net Income for
such period, (iv) cash federal, state and local income taxes to the extent
deducted in determining Net Income for such period and (v) increases in LIFO
reserves to the extent deducted in determining Net Income for such period, in
each case of the Borrowers and their respective subsidiaries for such period
determined on a Consolidated basis, computed and calculated in accordance
with generally accepted accounting principles.
"Eligible Assignee" shall mean a commercial bank, finance company,
insurance company, fund or other financial institution acceptable to the
Agent.
"Eligible Inventory" shall mean inventory owned by a Borrower which
is not, in the judgment of the Agent, obsolete or unmerchantable and is and
at all times shall continue to be acceptable to the Agent in its good faith
judgment in all respects but shall in any event include only finished goods
and shall not in any event include liquor and other alcoholic beverages,
delicatessen, produce, intercompany profit, print shop materials, gasoline
and/or grocery warehouse supplies, such categories of inventory to be
determined in a manner consistent in each case with the historical practices
and procedures of Jitney Jungle and its subsidiaries as heretofore presented
to the Agent and the Lenders. Standards of eligibility may be fixed and
revised from time to time solely by the Agent in the Agent's exclusive
judgment exercised in good faith. In determining eligibility, the Agent may,
but need not, rely on reports and schedules furnished by any Borrower, but
reliance by the Agent thereon from time to time shall not be deemed to limit
the right of the Agent to revise standards of eligibility at any time as to
both present and future inventory of such Borrower.
"Environmental Claim" shall mean any written notice of violation,
claim, demand, abatement or other order by any governmental authority or any
person for personal injury (including sickness, disease or death), tangible
or intangible property damage, damage to the environment, nuisance,
pollution, contamination or other adverse effects on the environment, or for
fines, penalties or deed or use restrictions, resulting from or based upon
(i) the existence, or the continuation of the existence, of a Release
(including, without limitation, sudden or non-sudden, accidental or
nonaccidental Releases), of, or exposure to, any Hazardous Material in, into
or onto the environment (including, without limitation, the air, ground,
water or any surface) at, in, by or from any of the properties of a Borrower
or its subsidiaries, (ii) the environmental aspects of the transportation,
storage, treatment or disposal of Hazardous Materials in connection with the
operation of any of the properties of a Borrower or its subsidiaries or (iii)
the violation, or alleged violation by a Borrower or any of its subsidiaries,
of any Environmental Laws relating to any of the properties of a Borrower or
its subsidiaries.
"Environmental Laws" shall mean the Comprehensive Environmental
Response, Compensation, and Liability Act (42 U.S.C. Section 9601 et seq.),
the Hazardous Material Transportation Act (49 U.S.C. Section 1801 et seq.),
the Resource Conservation and Recovery Act (42 U.S.C. Section 6901 et seq.),
the Federal Water Pollution Control Act (33 U.S.C. Section 1251 et seq.), the
Oil Pollution Act of 1990 (P.L. 101-380), the Safe Drinking Water Act (42
U.S.C. Section 300(f), et seq.), the Clear Air Act (42 U.S.C. Section 7401
et seq.), the Toxic Substances Control Act, as amended (15 U.S.C. Section
2601 et seq.), the Federal Insecticide, Fungicide, and Rodenticide Act (7
U.S.C. Section 136 et seq.), and the Occupational Safety and Health Act (29
U.S.C. Section 651 et seq.), as such laws have been and hereafter may be
amended or supplemented, and any related or analogous present or future
Federal, state or local, statutes, rules, regulations, ordinances, licenses,
permits and interpretations and orders of regulatory and administrative
bodies.
"ERISA" shall mean the Employee Retirement Income Security Act of
1974, as amended, and the rules and regulations promulgated thereunder, as in
effect from time to time.
"ERISA Affiliate" shall mean any trade or business (whether or not
incorporated) which together with any person or a subsidiary of such person
would be treated as a single employer under the provisions of Title I or
Title IV of ERISA.
"Eurodollar Lending Office" shall mean, with respect to any Lender,
the office of such Lender specified as its "Eurodollar Lending Office"
opposite its name in Schedule 2.03 annexed hereto (or, if no such office is
specified, its Domestic Lending Office), or such other office of such Lender
as such Lender may from time to time specify to the Borrowers and the Agent.
"Eurodollar Loan" shall mean a Loan bearing interest based on the
Adjusted LIBO Rate in accordance with Article II hereof.
"Event of Default" shall have the meaning assigned to such term in
Article VIII hereof.
"Excess Cash Flow" means, for any period, without duplication, (i)
the sum for such period of (A) Net Income, (B) depreciation and amortization
expenses of the Borrowers and their respective subsidiaries for such period,
to the extent the same are deducted from net revenues in determining Net
Income for such period, (C) the change (with such change being deemed to be a
positive number in the event of an increase and such change being deemed to
be a negative number in the event of a decrease) in deferred tax liabilities
of the Borrowers and their respective subsidiaries during such period, (D)
other non-cash items of the Borrowers and their respective subsidiaries
properly deducted in arriving at Net Income for such period, and (E) the
change (with such change being deemed to be a negative number to the extent
that it shall have resulted in an increase in Net Income for such period and
such change being deemed to be a positive number to the extent that it shall
have resulted in a decrease in Net Income for such period) in deferred tax
assets of the Borrowers and their respective subsidiaries during such period,
minus (ii) the sum for such period of (A) the aggregate amount actually paid
by the Borrowers and their respective subsidiaries in cash during such period
on account of Capital Expenditures (including payments in respect of
Capitalized Lease Obligations), (B) the aggregate amount actually
distributed by the Borrowers and their respective subsidiaries in cash during
such period in respect of dividends on or other distributions, redemptions or
other retirements of capital stock of any Borrower or subsidiary thereof, in
accordance with the provisions of this Agreement, (C) reserves taken and
occasioned by the closing of store locations, and (D) the aggregate of
principal payments (whether regularly scheduled payments, voluntary or
mandatory prepayments (including, without limitation, by reason of any
reduction of the Total Commitment and/or the Supplemental Availability) or
occurring by reason of acceleration or otherwise) of all Indebtedness
(including, without limitation, Capitalized Lease Obligations, Indebtedness
issued under the Senior Indenture and Indebtedness issued under the Senior
Subordinated Indenture) made or scheduled to have been made by the Borrowers
and their respective subsidiaries during such period (other than principal
payments on Loans except to the extent paid to permanently reduce the Total
Commitment and/or the Supplemental Availability), determined on a
Consolidated basis in accordance with generally accepted accounting
principles.
"Existing Credit Agreement" shall have the meaning assigned to such
term in the introductory paragraphs to this Agreement.
"Existing Lenders" shall have the meaning assigned to such term in
the introductory paragraphs to this Agreement.
"Existing Letters of Credit" shall mean the letters of credit issued
under the Existing Credit Agreement and outstanding on the Initial Closing
Date, all of which are listed on Schedule IV annexed hereto.
"Existing Loans" shall mean the "Loans" outstanding on the Initial
Closing Date under (and as defined in) the Existing Credit Agreement.
"Existing Security Documents" shall mean the "Security Documents" as
defined in the Existing Credit Agreement.
"Federal Funds Effective Rate" shall mean, for any day, the weighted
average of the rates on overnight Federal funds transactions with members of
the Federal Reserve System arranged by Federal funds brokers, as published on
the next succeeding Business Day by the Federal Reserve Bank of New York, or,
if such rate is not so published for any day which is a Business Day, the
average for the quotations
for the day of such transactions received by the Agent from three Federal
funds brokers of recognized standing selected by it.
"Fee Letter" shall mean that certain Fee Letter, dated July 7, 1997,
by Fleet to Jitney Jungle and accepted by Jitney Jungle, as amended, modified
or supplemented from time to time in writing by Fleet and Jitney Jungle.
"Final Maturity Date" shall mean the six and one-half year
anniversary of the Initial Closing Date.
"Financial Officer" shall mean, with respect to any person, the
chief financial officer, chief accounting officer or treasurer of such person.
"FIRREA" shall mean the Financial Institutions Reform, Recovery and
Enforcement Act of 1989, as amended and supplemented from time to time.
"fiscal month" shall mean each of the thirteen consecutive four-week
periods of the Borrowers used for accounting purposes and ending on the dates
designated as fiscal month-ends in Schedule II annexed hereto.
"fiscal quarter" shall mean each of the four fiscal quarters of each
fiscal year of the Borrowers used for accounting purposes and ending on the
dates designated as fiscal quarter-ends in Schedule II annexed hereto.
"Fiscal Year" shall mean the fiscal year of the Borrowers for
accounting purposes which ends on the dates designated as fiscal year-ends in
Schedule II annexed hereto.
"Fixed Charge Coverage Ratio" shall mean, for any fiscal period, the
ratio of (i) EBITDA of the Borrowers and their respective subsidiaries for
the four most recent consecutive fiscal quarters ending on or prior to the
date of determination to (ii) the sum of, without duplication, (A) Interest
Expense, (B) Capital Expenditures, (C) cash dividends paid by, or other
distributions, redemptions, repurchases or retirements of capital stock of,
the Borrowers and their respective subsidiaries, (D) taxes actually paid by
the Borrowers and their respective subsidiaries in cash and (E) the aggregate
of principal payments (whether regularly scheduled payments, voluntary or
mandatory prepayments (including, without limitation, by reason of any
reduction of the Total Commitment and/or the Supplemental Availability) or
occurring by reason of acceleration or otherwise) of all Indebtedness
(including, without limitation, Capitalized Lease Obligations, Indebtedness
issued under the Senior Indenture and under the Senior Subordinated
Indenture) made or scheduled to have been made by the Borrowers and their
respective subsidiaries (other than principal payments on Loans except to the
extent paid to permanently reduce the Total Commitment and/or the
Supplemental Availability), for such four-quarter period, in each case
determined on a
Consolidated basis in accordance with generally accepted accounting principles.
"Fleet" shall have the meaning assigned to such term in the preamble
to this Agreement.
"Fleet Bank" shall mean Fleet Bank, N.A.
"FTC Divestiture Stores" shall mean the Borrowers' stores required
to be sold in connection with the Borrowers' divestiture plan with the
Federal Trade Commission, as listed on Schedule V annexed hereto.
"Grantor" shall mean any Assignor, Grantor, Pledgor, Mortgagor or
Debtor, as such terms are defined in any of the Security Documents.
"Guarantee" shall mean any obligation, contingent or otherwise, of
any person guaranteeing or having the economic effect of guaranteeing any
Indebtedness or obligation of any other person in any manner, whether
directly or indirectly, and shall in any event include any guarantee under
Article XII hereof, and shall include, without limitation, any obligation of
such person, direct or indirect, to (i) purchase or pay (or advance or supply
funds for the purchase or payment of) such Indebtedness or obligation or to
purchase (or to advance or supply funds for the purchase of) any security for
the payment of such Indebtedness or obligation, (ii) purchase property,
securities or services for the purpose of assuring the owner of such
Indebtedness or obligation of the payment of such Indebtedness or obligation,
or (iii) maintain working capital, equity capital, available cash or other
financial condition of the primary obligor so as to enable the primary
obligor to pay such Indebtedness or obligation; provided, however, that the
term Guarantee shall not include endorsements for collection or collections
for deposit, in either case in the ordinary course of business.
"Guarantor" shall mean, collectively, each Borrower and each
subsidiary thereof or any subsidiary of any Borrower which becomes a
guarantor of the Obligations after the date hereof.
"Hazardous Material" shall mean any pollutant, contaminant,
chemical, or industrial or hazardous, toxic or dangerous waste, substance or
material, defined or regulated as such in (or for purposes of) any
Environmental Law and any other toxic, reactive, or flammable chemicals,
including (without limitation) any asbestos, any petroleum (including crude
oil or any fraction), any radioactive substance and any polychlorinated
biphenyls; provided, in the event that any Environmental Law is amended so as
to broaden the meaning of any term defined thereby, such broader meaning
shall apply subsequent to the effective date of such amendment; provided,
further, to the extent that the applicable laws of any state establish a
meaning for "hazardous material," "hazardous substance," "hazardous waste,"
"solid waste" or "toxic substance" which is broader than that specified in
any federal Environmental Law, such broader meaning shall apply.
"Indebtedness" shall mean, with respect to any person, without
duplication, (i) all obligations of such person for borrowed money or with
respect to deposits or advances of any kind, (ii) all obligations of such
person evidenced by bonds, debentures, notes or other similar instruments,
(iii) all obligations of such person for the deferred purchase price of
property or services, except current accounts payable arising in the ordinary
course of business and not overdue or being contested in good faith, (iv) all
obligations of such person under conditional sale or other title retention
agreements relating to property purchased by such person, (v) all payment
obligations of such person with respect to interest rate or currency
protection agreements, (vi) all obligations of such person as an account
party under any letter of credit or in respect of bankers' acceptances, (vii)
all obligations of any third party secured by property or assets owned by
such person (regardless of whether or not such person is liable for repayment
of such obligations), (viii) all Guarantees of such person and (ix) all
obligations of such person as lessee under leases the expenditures under
which are Capitalized Lease Obligations.
"Indemnitees" shall have the meaning assigned to such term in
Section 11.04(c) hereof.
"Information" shall have the meaning assigned to such term in
Section 11.11 hereof.
"Initial Adjustment Date" shall mean the date on which the Borrowers
deliver to the Agent the financial statements with respect to the fiscal
quarter ending January 10, 1998.
"Initial Closing Date" shall mean the date of the first Loan, but in
no event later than September 30, 1997.
"Intercompany Indebtedness" shall mean, with respect to any
Borrower, Indebtedness of such person to any subsidiary thereof or any other
Borrower or any subsidiary thereof, incurred in the ordinary course of
business.
"Intercompany Loans" shall mean, with respect to any Borrower, loans
made by such person to any subsidiary thereof or any other Borrower or any
subsidiary thereof, in the ordinary course of such Borrower's business.
"Interest Coverage Ratio" shall mean, for any fiscal period, the
ratio of (i) EBITDA of the Borrowers and their respective subsidiaries for
the four most recent consecutive fiscal quarters ending on or prior to the
date of determination, to (ii) Interest Expense of the Borrowers and their
respective subsidiaries for such four-quarter period.
"Interest Expense" shall mean, for any fiscal period, the interest
expense paid or payable in cash of the Borrowers and their respective
subsidiaries during such fiscal period determined on a Consolidated basis in
accordance with generally accepted accounting principles, and shall in any
event include, without limitation, interest on Capitalized Lease Obligations
for such fiscal period.
"Interest Payment Date" shall mean (i) in the case of a Base Rate
Loan, the last Business Day of each March, June, September and December,
commencing September 30, 1997, and (ii) with respect to any Eurodollar Loan,
the last day of the Interest Period applicable thereto, and, in addition, in
respect of any Eurodollar Loan of more than three (3) months' duration, each
earlier day which is three (3) months after the first day of such Interest
Period.
"Interest Period" shall mean, as to any Eurodollar Loan, the period
commencing on the date of such Eurodollar Loan and ending on the numerically
corresponding day (or, if there is no numerically corresponding day, on the
last day) in the calendar month that is one (1), two (2), three (3) or six
(6) months thereafter, as the Borrowers may elect with respect to such
Eurodollar Loan in accordance with the terms hereof; provided, however, that
(x) if an Interest Period would end on a day that is not a Business Day, such
Interest Period shall be extended to the next succeeding Business Day unless,
with respect to such Eurodollar Loan, 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, (y) no Interest Period shall end later
than the Final Maturity Date and (z) interest shall accrue from and including
the first day of an Interest Period to but excluding the last day of such
Interest Period.
"Interstate" shall have the meaning assigned to this term in the
preamble to this Agreement.
"Investor Group" shall mean BRS, DLJ Merchant Banking Partners L.P.
and such other investors as are set forth on Schedule I annexed hereto.
"IRB Indebtedness" shall mean the Indebtedness with respect to the
City of Jackson, Mississippi Industrial Revenue Bonds (XxXxxxx-Xxxxxx Co.,
Inc. Project), Series 1985, in the aggregate outstanding amount of $3,650,000.
"IRB Trustee" shall mean SunTrust Bank, Atlanta, as trustee under
the trust indenture relating to the IRB Indebtedness.
"Landlord Waiver" shall mean a landlord's or bailee's agreement with
respect to each property of a Borrower subject to a lease substantially in
the form of Exhibit H hereto or as agreed to by Agent.
"Lender" shall have the meaning assigned to such term in the
preamble to this Agreement.
"Letter of Credit" shall have the meaning assigned such term in
Section 2A.01 hereof.
"Letter of Credit Issuer" shall mean Fleet, Fleet Bank , Fleet
National Bank or any other Lender which, with the consent of the Agent,
agrees, in such Lender's sole discretion, to become a Letter of Credit Issuer
for purposes of issuing Letters of Credit hereunder.
"Letter of Credit Usage" shall mean at any time, (i) the aggregate
undrawn amount of all outstanding Letters of Credit plus (ii) the
unreimbursed drawing at such time under Letters of Credit.
"Leverage Ratio" shall mean, at the end of any fiscal quarter, the
ratio of (i) all Indebtedness of the Borrowers and their respective
subsidiaries (including, without limitation, the amount of Obligations
outstanding under this Agreement (whether for principal, interest or
premium), the Indebtedness under the Senior Notes and Indebtedness under the
Senior Subordinated Notes, but excluding Intercompany Indebtedness) as at the
date of determination to (ii) EBITDA of the Borrowers and their respective
subsidiaries for the four-quarter period ending at the date of determination,
in each case determined on a Consolidated basis in accordance with generally
accepted accounting principles.
"LIBO Rate" shall mean, with respect to any Eurodollar Loan for any
Interest Period, an interest rate per annum (rounded upwards, if necessary,
to the next 1/16 of 1%) equal to the rate at which dollar deposits
approximately equal in principal amount to the corresponding Eurodollar Loan
and for a maturity equal to the applicable Interest Period are offered in
immediately available funds to Fleet National Bank by leading banks in the
London interbank market for Eurodollars at approximately 11:00 A.M., London
time, two (2) Business Days prior to the first day of such Interest Period.
"Lien" shall mean, with respect to any asset, (i) any mortgage,
lien, pledge, encumbrance, charge or security interest in or on such asset,
(ii) the interest of a vendor or a lessor under any conditional sale
agreement, capital lease or other title retention agreement relating to such
asset, (iii) in the case of securities, any purchase option, call or similar
right of a third party with respect to such securities or (iv) any other
right of or arrangement with any creditor to be entitled to receive any such
mortgage, lien, pledge, encumbrance, charge or security interest on or to
have such creditor's claim satisfied out of such assets, or the proceeds
therefrom, prior to the general creditors of the owner thereof.
"Loan" shall mean a Loan made pursuant to Sections 2.01(a) and 2.02
hereof.
"Loan Documents" shall mean this Agreement, each Security Document,
the Notes, any letter of credit applications with respect to Letters of
Credit and each other document, instrument, or agreement now or hereafter
delivered to the Agent, any Lender or the Letter of Credit Issuer in
connection herewith or therewith.
"Margin Stock" shall have the meaning assigned to such term in
Regulation U.
"Material Adverse Effect" shall mean a material adverse effect on
(i) the business, assets, liabilities, properties, prospects, operations or
financial condition of the Borrowers and their respective subsidiaries taken
as a whole, (ii) the ability of any Borrower or any Guarantor to perform or
pay the Obligations in accordance with the terms hereof or of any other Loan
Document or to perform its other material obligations thereunder or (iii) the
Agent's Lien on any Collateral (other than a de minimis portion of the
Collateral) or the priority of such Lien.
"Maximum Facility Amount" shall mean, with respect to any Borrower,
at any date of determination, (A) the lesser of (i) the Total Commitment (as
such amount may be reduced pursuant to Section 2.07 hereof) and (ii) the
Borrowing Base of such Borrower (calculated for the purposes of this
definition using only Eligible Inventory owned by such Borrower (and not any
other Borrower) and deducting all Supplemental Availability Advances then
outstanding to any Borrower other than such Borrower) minus (B) all Loans
previously made to or on behalf of such Borrower and not repaid and all
Letter of Credit Usage with respect to Letters of Credit previously issued
for the account of such Borrower.
"XxXxxxx-Xxxxxx" shall have the meaning assigned to this term in the
preamble to this Agreement.
"Merger" shall have the meaning assigned to such term in the Merger
Agreement.
"Merger Agreement" shall mean the Agreement and Plan of Merger,
dated as of July 8, 1997, among Jitney Jungle, Acquisition Corp. and the
Target Company, as amended, modified or supplemented from time to time in
accordance with the terms thereof and subject to the terms of Section 7.18
hereof.
"Merger Closing Date" shall mean the date on which the conditions
set forth in Section 5.03 are satisfied, but in no event later than March 13,
1998.
"Merger Documents" shall mean the Merger Agreement, and all
agreements, documents and instruments executed and delivered pursuant thereto
or in connection therewith, in each case as in effect on the Initial Closing
Date and as
amended, modified or supplemented from time to time in accordance
with the terms thereof and subject in each case to the terms of Section 7.18
hereof.
"Minimum Percentage" shall have the meaning assigned to such term in
Section 5.02(m)(ii) hereof.
"Mortgages" shall have the meaning set forth in Section 3.03 hereof.
"Multiemployer Plan" shall mean a "multiemployer plan" as defined in
Section 4001(a)(3) of ERISA.
"Net Amount of Eligible Inventory" of any Borrower shall mean, at
any time, the aggregate value, computed at the lower of cost (on a FIFO
basis) and current market value, of Eligible Inventory of such Borrower.
"Net Cash Proceeds" shall mean, with respect to any Asset Sale, the
Cash Proceeds resulting therefrom net of expenses of sale (including
reasonable brokers and attorneys fees and payment of principal, premium and
interest of Indebtedness secured by the assets the subject of the Asset Sale
and required to be, and which is, repaid under the terms thereof as a result
of such Asset Sale), and incremental taxes paid or payable as a result
thereof.
"Net Income" shall mean, for any period, the aggregate income (or
loss) of the Borrowers and their respective subsidiaries determined on a
Consolidated basis for such period, all computed and calculated in accordance
with generally accepted accounting principles consistently applied.
"New Lenders" shall mean DLJ Capital Funding, Inc.
"Non-Defaulting Lenders" shall have the meaning assigned to such
term in Section 11.15(b) hereof.
"Non-Ratable Loans" shall have the meaning assigned to such term in
Section 2.17(c)(iii) hereof.
"Notes" shall mean the revolving notes of the Borrowers, executed
and delivered as provided in Section 2.04 hereof, in substantially the form
of Exhibit A annexed hereto, as amended, modified or supplemented from time
to time.
"Obligations" shall mean all obligations, liabilities and
Indebtedness of any Borrower and/or any Guarantor to the Lenders, the Agent
and/or the Letter of Credit Issuer, whether now existing or hereafter
created, direct or indirect, due or not, whether created directly or acquired
by assignment, participation or otherwise, under or with respect to this
Agreement, the Notes, the Security Documents and the other Loan
Documents, including, without limitation, the principal of and interest on
the Loans and the payment or performance of all other obligations,
liabilities, and Indebtedness of any Borrower and/or any Guarantor to the
Lenders, the Agent and/or the Letter of Credit Issuer hereunder, under or
with respect to the Letters of Credit, under any one or more of the other
Loan Documents or owing to Fleet under or with respect to interest rate
protection agreements and other similar arrangements permitted by Section
7.03(iv) hereof, including but not limited to all fees, costs, expenses and
indemnity obligations hereunder and thereunder.
"Offer to Purchase" means Jitney Jungle's Offer to Purchase for Cash
dated July 14, 1997 (including all exhibits and schedules thereto), as in
effect on the date hereof, and filed by Jitney Jungle with the SEC in
connection with the Tender Offer, as from time to time amended, modified or
supplemented subject to the terms of Section 7.18 hereof.
"Original Acquisition Documents" shall mean the "Acquisition
Documents" as defined in the Existing Credit Agreement.
"Original Closing Date" shall mean March 5, 1996.
"Other Taxes" shall have the meaning assigned to such term in
Section 2.15(b) hereof.
"Partnership Pledge Agreement" shall mean the Partnership Pledge
Agreement, among the Grantors party thereto and the Agent, for the benefit of
the Secured Parties, in substantially the form of Exhibit C-2 annexed hereto,
as amended, modified or supplemented from time to time.
"PBGC" shall mean the Pension Benefit Guaranty Corporation.
"Pension Plan" shall mean any Plan which is subject to the
provisions of Title IV of ERISA.
"Permits" shall have the meaning assigned to such term in Section
4.18 hereof.
"person" shall mean any natural person, corporation, business trust,
association, company, joint venture, partnership or government or any agency
or political subdivision thereof.
"Plan" shall mean any employee benefit plan within the meaning of
Section 3(3) of ERISA and which is maintained (in whole or in part) for
employees of any Borrower or any subsidiary thereof or any ERISA Affiliate
thereof or for employees of the Target Company or any subsidiary thereof or
any ERISA Affiliate thereof.
"Pledge Agreement" shall mean the Pledge Agreement, dated as of
March 5, 1996, as heretofore amended and as amended and restated as of the
date hereof, among the Borrowers, the Guarantors and the Agent, for the
benefit of the Secured Parties, in substantially the form of Exhibit C-1
annexed hereto, as amended, modified or supplemented from time to time.
"Pledged Stock" shall have the meaning assigned to such term in the
Pledge Agreement.
"Prime Rate" shall mean the rate which Fleet National Bank announces
from time to time as its prime lending rate, as in effect from time to time.
The Prime Rate is a reference rate and does not necessarily represent the
lowest or best rate actually charged to any customer. Fleet National Bank
and any Affiliate thereof may make commercial loans or offer loans at, above
or below the Prime Rate. Any change in the Prime Rate shall be effective
hereunder on the effective date of such change announced by Fleet National
Bank.
"Prior Indebtedness" shall mean the Indebtedness of Jitney Jungle
and/or its subsidiaries outstanding on the Initial Closing Date, other than
(i) the IRB Indebtedness, (ii) Capitalized Lease Obligations existing on the
date hereof and secured by Liens permitted under Section 7.01, (iii) the
Senior Notes and (iv) reimbursement obligations under letters of credit
issued for the account of Delchamps in an approximate amount of $750,000.
"Reduction Discount" shall mean initially zero and from and after
the first day of each fiscal quarter, commencing with the first fiscal
quarter ending after the Initial Adjustment Date, immediately following the
date of delivery by the Borrowers to the Agent of the financial statements
with respect to the immediately preceding fiscal quarter (a "Test Period") of
the Borrowers and their respective subsidiaries (the "Financials") as
required under Section 6.05(b)(i) of this Agreement, together with
calculations in form and substance reasonably satisfactory to the Agent
supporting the calculation of the Leverage Ratio as at the end of such fiscal
quarter and a written certification from the Financial Officer of Jitney
Jungle to such effect, the Reduction Discount shall be as specified in
clauses (i) through (v) below, when, and for so long as, the Leverage Ratio
set forth in such clause has been satisfied as at the end of the then Test
Period:
(i) for purposes of calculating the Applicable Margin and the
Commitment Fee, the Reduction Discount shall be zero in the event that, as of
the end of the Test Period, the Leverage Ratio for the four consecutive
fiscal quarters ending on the last day of such Test Period is greater than or
equal to 5.00; or
(ii) for purposes of calculating the Applicable Margin, the Reduction
Discount shall be .25 and for purposes of calculating the Commitment Fee, the
Reduction Discount shall be .075 in the event that, as of the end of the Test
Period, the Leverage Ratio for the four consecutive fiscal quarters ending on
the last day of such Test Period is greater than or equal to 4.25 but less
than 5.00; or
(iii) for purposes of calculating the Applicable Margin, the
Reduction Discount shall be .50 and for purposes of calculating the
Commitment Fee, the Reduction Discount shall be .125 in the event that, as of
the end of the Test Period, the Leverage Ratio for the four consecutive
fiscal quarters ending on the last day of such Test Period is greater than or
equal to 3.75 but less than 4.25; or
(iv) for purposes of calculating the Applicable Margin, the
Reduction Discount shall be .75 and for purposes of calculating the
Commitment Fee, the Reduction Discount shall be .25 in the event that, as of
the end of the Test Period, the Leverage Ratio for the four consecutive
fiscal quarters ending on the last day of such Test Period is greater than or
equal to 3.25 but less than 3.75; or
(v) for purposes of calculating the Applicable Margin, the
Reduction Discount shall be 1.00 and for purposes of calculating the
Commitment Fee, the Reduction Discount shall be .25 in the event that, as of
the end of the Test Period the Leverage Ratio for the four consecutive fiscal
quarters ending on the last day of such Test Period is less than 3.25;
provided, that the entire Reduction Discount, if any, at any time in effect
shall be reduced to zero at all times on and after the occurrence and during
the continuance of an Event of Default; and provided, further, that in the
event that the Leverage Ratio on the last day of any Test Period (the "New
Test Period") is less than or greater than the ratio then in effect for the
previous Test Period pursuant to clause (ii), (iii), (iv) or (v) above, the
Reduction Discount specified in clause (ii), (iii), (iv) or (v) above shall
be discontinued and the Reduction Discount shall be the Reduction Discount
applicable to the Leverage Ratio for such New Test Period effective as of the
first day of the fiscal quarter immediately following the date of delivery by
the Borrowers to the Agent of such Financials.
"Register" shall have the meaning assigned to such term in Section
11.03(e) hereof.
"Regulation D" shall mean Regulation D of the Board, as the same is
from time to time in effect, and all official rulings and interpretations
thereunder or thereof.
"Regulation G" shall mean Regulation G of the Board, as the same is
from time to time in effect, and all official rulings and interpretations
thereunder or thereof.
"Regulation T" shall mean Regulation T of the Board, as the same is
from time to time in effect, and all official rulings and interpretations
thereunder or thereof.
"Regulation U" shall mean Regulation U of the Board, as the same is
from time to time in effect, and all official rulings and interpretations
thereunder or thereof.
"Regulation X" shall mean Regulation X of the Board, as the same is
from time to time in effect, and all official rulings and interpretations
thereunder.
"Reinvestment Assets" shall mean, with respect to any Asset Sale,
any properties or assets that replace the properties or assets that were the
subject of such Asset Sale that will be employed in the business of the
Borrowers and their respective subsidiaries as operated on the Initial
Closing Date.
"Reinvestment Election" shall have the meaning provided in Section
2.09(d)(i) hereof.
"Reinvestment Notice" shall mean a written notice signed by an
Responsible Officer of the relevant Borrower stating that such Borrower, in
good faith, intends and expects to use all or a specified portion of the Net
Cash Proceeds of an Asset Sale to purchase, construct or otherwise acquire
Reinvestment Assets.
"Reinvestment Prepayment Amount" shall mean, with respect to any
Reinvestment Election, the amount, if any, on the Reinvestment Prepayment
Date relating thereto by which (i) the Anticipated Reinvestment Amount in
respect of such Reinvestment Election exceeds (ii) the aggregate amount
thereof expended by the relevant Borrower to acquire Reinvestment Assets.
"Reinvestment Prepayment Date" shall mean, with respect to any
Reinvestment Election, the earlier of (i) the date occurring one year after
such Reinvestment Election and (ii) the date on which the Borrowers shall
have determined not to, or shall have otherwise ceased to, proceed with the
purchase, construction or other acquisition of Reinvestment Assets with the
related Anticipated Reinvestment Amount.
"Related Transactions" shall mean the Acquisition, the Tender Offer,
the Merger, the execution and delivery of the Merger Documents and the Tender
Offer Documents, each borrowing of a Loan on the Initial Closing Date and the
Merger Closing Date, the issuance of the Senior Subordinated Notes, the
repayment of the Target Indebtedness and the payment of all fees, costs and
expenses associated with all of the foregoing.
"Release" shall mean any releasing, spilling, leaking, seeping,
pumping, pouring, emitting, emptying, discharging, injecting, escaping,
leaching, disposing or dumping, in each case as defined in Environmental Law,
and shall include any
"Threatened Release," as defined in Environmental Law.
"Remedial Work" shall mean any investigation, site monitoring,
containment, cleanup, removal, restoration or other remedial work of any kind
or nature with respect to any property of any Borrower or any of its
subsidiaries (whether such property is owned, leased, subleased or used),
including, without limitation, with respect to Hazardous Materials and the
Release thereof.
"Reportable Event" shall mean a Reportable Event as defined in
Section 4043(b) of ERISA, but not including any such event as to which the
PBGC, by applicable regulation, has waived the requirement of notice under
Section 4043(a).
"Required Lenders" shall mean Lenders having 51% of the Total
Commitment.
"Responsible Officer" shall mean, with respect to any person, the
chief executive officer, chief financial officer, president, vice president,
or treasurer, of such person.
"SEC" shall mean the Securities and Exchange Commission.
"Secured Parties" shall mean the Agent, the Lenders and the Letter of
Credit Issuer.
"Securities Purchase and Holders Agreement" shall mean the
Securities Purchase and Holders Agreement, dated as of March 5, 1996, among
Jitney Jungle, BRS, the individuals listed on Schedule I thereto and the
Trust established under a Trust Agreement dated as of March 1, 1996 between
Jitney Jungle as grantor and Trustmark National Bank, as trustee, as from
time to time amended, supplemented or modified.
"Security Agreement" shall mean each Security Agreement, dated as of
March 5, 1996, as heretofore amended and as amended and restated as of the
date hereof, between the Grantor(s) and the Agent, for the benefit of the
Secured Parties, each substantially in the form of Exhibit D annexed hereto,
as amended, modified or supplemented from time to time.
"Security Agreement -- Patents and Trademarks" shall mean each
Security Agreement -- Patents and Trademarks dated as of March 5, 1996, as
heretofore amended and as amended and restated as of the date hereof, between
the Grantor(s) and the Agent, for the benefit of the Secured Parties, each
substantially in the form of Exhibit F annexed hereto, as amended, modified
or supplemented from time to time.
"Security Documents" shall mean the Assignment of Contract, the
Pledge Agreement, the Partnership Pledge Agreement, the Security Agreement,
the Security Agreement -- Patents and Trademarks, the Chattel Mortgage, the
Mortgages and each other agreement now existing or hereafter created
providing collateral security for the payment or performance of any
Obligations.
"Senior Indenture" shall mean the Indenture relating to the Senior
Notes dated as of March 5, 1996, as amended and in effect on the Initial
Closing Date, among the Borrowers and Marine Midland Bank, as trustee, as
from time to time amended, supplemented or modified, subject to the terms of
Section 7.18 hereof.
"Senior Notes" shall mean the $200,000,000 minimum aggregate
original principal amount of the Borrowers' senior unsecured promissory notes
issued and delivered pursuant to the Senior Indenture.
"Senior Subordinated Indenture" shall mean the Indenture relating to
the Senior Subordinated Notes, dated as of September 15, 1997, by and among
the Borrowers party thereto, the Subsidiary Guarantors (as defined therein)
party thereto and Marine Midland Bank, as trustee, as from time to time as
amended, modified or supplemented, subject to the terms of Section 7.18
hereof.
"Senior Subordinated Notes" shall mean the $200,000,000 minimum
aggregate original principal amount of the Borrowers' senior subordinated
unsecured promissory notes issued and delivered pursuant to the Senior
Subordinated Indenture.
"Settlement Date" shall mean each Business Day after the Initial
Closing Date selected by the Agent in its sole discretion subject to and in
accordance with the provisions of Section 2.17(c) as of which a Settlement
Report is delivered by the Agent and on which settlement is to be made among
the Lenders in accordance with the provisions of Section 2.17 hereof.
"Settlement Report" shall mean each report, substantially in the
form attached hereto as Exhibit I hereto, prepared by the Agent and delivered
to each Lender and setting forth, among other things, as of the Settlement
Date indicated thereon and as of the next preceding Settlement Date, the
aggregate principal balance of all Loans outstanding, each Lender's ratable
portion thereof, each Lender's Loans and all Non-Ratable Loans made, and all
payments of principal received by the Agent from or for the account of the
Borrowers during the period beginning on such next preceding Settlement Date
and ending on such Settlement Date.
"Southern Jitney Jungle" shall have the meaning assigned to this
term in the preamble to this Agreement.
"Subordinated Indebtedness" shall mean, with respect to any Borrower
or any subsidiary thereof, Indebtedness subordinated in right of payment to
such person's
monetary obligations under this Agreement and the other Loan Documents
upon terms satisfactory to and approved in writing by the Agent, to the extent
it does not by its terms (except as otherwise approved in writing by the Agent)
mature or become subject to any mandatory prepayment or amortization of
principal prior to the Final Maturity Date, and shall in any event include the
Indebtedness of Jitney Jungle pursuant to the Senior Subordinated Indenture.
"subsidiary" shall mean, with respect to any person, the parent of
such person, any corporation, association or other business entity of which
securities or other ownership interests representing more than 50% of the
ordinary voting power are, at the time as of which any determination is being
made, owned or controlled, directly or indirectly, by the parent or one or more
subsidiaries of the parent.
"SunTrust LC" shall mean the irrevocable letter of credit
number F501212 issued by SunTrust Bank, Atlanta, in favor of the IRB Trustee.
"Supplemental Availability" shall mean initially $53,000,000, as from
time to time reduced pursuant to Section 2.07(b) hereof.
"Supplemental Availability Advances" shall mean the aggregate amount
of Loans and Letters of Credit Usage outstanding in excess of the amount set
forth in Section 2.01(a)(1)(B)(i).
"Syndication Date" shall mean the earlier of (x) the date which is 90
days after the Initial Closing Date and (y) the date upon which the Agent
determines in its sole discretion (and notifies Jitney Jungle) that the primary
syndication (and the resulting addition to institutions as Lenders pursuant to
Section 11.03(c)) has been completed.
"Target Company" shall mean Delchamps, Inc., an Alabama corporation.
"Target Indebtedness" shall mean the Indebtedness of the Target
Company and/or its subsidiaries outstanding on the Initial Closing Date under
(x) a Loan Agreement, dated as of June 29, 1995, among the Target Company, the
financial institutions from time to time party thereto and Hibernia National
Bank, as agent, (y) a Promissory Note in the original principal amount of
$937,521.00 dated March 1, 1993 by the Target Company in favor of Hibernia
National Bank and (z) a Note Agreement dated as of June 30, 1993 between the
Target Company and Great West Life & Annuity Insurance Company relating to the
Target Company's 5.51% Senior Notes due July 1, 2000, in each case as from time
to time amended and in effect on the Initial Closing Date.
"Target Stock" shall mean shares of capital stock of the Target
Company.
"Taxes" shall have the meaning assigned to such term in
Section 2.15(a) hereof.
"Tender Offer" shall mean the public tender offer by Jitney Jungle to
purchase for cash 100% of the outstanding shares of common stock, par value $.01
per share, of the Target Company, including associated preferred share purchase
rights, at a price not to exceed $30.00 per share, all in accordance with the
terms of the Offer to Purchase, as filed by Jitney Jungle with the SEC pursuant
to Section 14(d)(1) of the Securities Exchange Act of 1934.
"Tender Offer Documents" shall mean the Offer to Purchase, the
Schedule 14D-1 filed by Jitney Jungle, and all amendments, exhibits, proxy
material and related documents and materials filed with the SEC or distributed
to the stockholders of the Target Company.
"Tendered Securities" shall mean and include the Target Stock deemed
to have been accepted for payment (and thereby purchased) by Jitney Jungle
pursuant to the Offer to Purchase.
"Termination Date" shall mean the earlier to occur of (i) the Final
Maturity Date and (ii) the date on which the Commitments shall terminate, expire
or be canceled in accordance with the terms of this Agreement.
"Total Commitment" shall mean the sum of the Lenders' Commitments.
"Transactions" shall have the meaning assigned to such term in
Section 4.02 hereof.
"Undrawn Availability" shall mean, at any time, an amount equal to
(A) the lesser of (i) the Total Commitment and (ii) the Borrowing Base, minus
(B) the sum of (i) all Loans outstanding at such time, (ii) the Letter of Credit
Usage at such time and (iii) reserves established pursuant to Section 2.01(c)
below at such time.
Unless otherwise expressly provided herein, each accounting term used
herein shall have the meaning given it under generally accepted accounting
principles in effect from time to time in the United States applied on a basis
consistent with those used in preparing the financial statements referred to in
Section 6.05 hereof; provided, however, that each reference in Article VII
hereof, or in the definition of any term used in Article VII hereof, to
generally accepted accounting principles shall mean generally accepted
accounting principles as in effect on the date hereof. In calculating EBITDA,
the Fixed Charge Coverage Ratio and Interest Expense for purposes of determining
compliance with the financial covenants contained in Section 7.08 through 7.11
(inclusive) and the calculation of Applicable Margin (and the definitions
contained herein to the extent utilized in determining such compliance) for each
fiscal period
ending on or prior to the fiscal quarter of the Borrowers and their
respective subsidiaries ending on October 18, 1997 only, such calculations
shall be made for each of Jitney Jungle and its subsidiaries (excluding
Delchamps and its subsidiaries) and Delchamps and its subsidiaries, in each
case on a Consolidated Basis for such period in accordance with generally
accepted accounting principles, and then combined.
IA. AMENDMENT AND RESTATEMENT OF CREDIT AGREEMENT
SECTION 1A.01. (a) Existing Loans and Existing Letters of Credit.
On the Initial Closing Date:
(i) the Existing Loans held by each Existing Lender shall
automatically, and without any action on the part of any person,
be Loans of such Lender hereunder and any Notes (as defined in
the Existing Credit Agreement) evidencing the same shall be
returned to the Agent and marked "Replaced" (to be held until the
Termination Date), with any Loans then outstanding to be
reflected by the Agent on its books and records in accordance
with the terms of this Agreement;
(ii) the Existing Letters of Credit shall automatically, and
without any action on the part of any person, be Letters of
Credit issued hereunder;
(iii) the "commitment" of each of the Existing Lenders
to lend under the Existing Credit Agreement shall continue as,
and be evidenced by, the Commitment of each such Lender under
this Agreement, except that the Commitment of each such Lender
shall be as set forth in Schedule 2.01 annexed hereto, and the
Commitment of each New Lender shall be as set forth in
Schedule 2.01 annexed hereto, in each case as reflected by the
Agent on its books and records; and
(iv) all interest and fees (other than the fee specified in
Section 2.06(b)) accrued up to, but not including, the Initial
Closing Date, under the Existing Credit Agreement shall be paid
by the Borrowers to the Agent for disbursement to the Agent
(under and as defined in the Existing Credit Agreement), the
Existing Lenders and Fleet Bank, as letter of credit issuer
thereunder, in accordance with the terms of the Existing Credit
Agreement; all such interest and fees may be financed by the
Lenders as a Loan to be made on the Initial Closing Date;
in each case in such amounts (and the Lenders shall, through the
Agent,
make such additional adjustments among themselves as shall be
necessary) so that after giving effect to such assignments,
adjustments, revolving credit loans and letters of credit, the
interests of the Lenders in the Loans and the Letters of Credit
shall be pro rata in accordance with Section 2.13 hereof.
(b) Interest Periods. On the Initial Closing Date, all "Interest
Periods" under and as defined in the Existing Credit Agreement, if any, shall
automatically be terminated.
(c) Continuation of Indebtedness, Etc. Except as expressly provided
herein, the indebtedness outstanding under the Existing Credit Agreement on the
Initial Closing Date shall not be deemed to be repaid or prepaid by the
amendment and restatement of the Existing Credit Agreement provided for hereby
or the other transactions stated to occur on the Initial Closing Date, but such
indebtedness shall continue to be outstanding hereunder on the terms and
conditions hereof. Without limitation of the foregoing, upon the satisfaction
of the conditions precedent set forth in Section 5.01 and 5.02 hereof, the
Commitments and the Notes (if any) shall be in renewal of, and substitution and
replacement for, the commitments (if any) of the Existing Lenders to lend under
the Existing Credit Agreement (and each of the Notes as defined therein and
delivered thereunder).
(d) No Novation. The execution, delivery or effectiveness of this
Agreement shall not extinguish the obligations for the payment of money
outstanding under the Existing Credit Agreement or discharge or release the lien
or priority of any security agreement or any other security therefor. Nothing
herein contained shall be construed as a substitution or novation of the
obligations outstanding under the Existing Credit Agreement or instruments
securing the same, which shall remain in full force and effect, except as
modified hereby or by instruments executed concurrently herewith. Nothing
expressed or implied in this Agreement or any other document contemplated hereby
or thereby shall be construed as a release or other discharge of any Borrower,
any Guarantor, any Assignor, any Debtor, any Grantor, any Mortgagor or any
Pledgor under the Existing Credit Agreement or any of the Loan Documents (as
defined in the Existing Credit Agreement) from any of its obligations and
liabilities as a "Guarantor", "Assignor", "Debtor", "Grantor", "Mortgagor" or
"Pledgor", as the case may be, thereunder. Each of the Existing Credit
Agreement and the other Loan Documents (as defined in the Existing Credit
Agreement) shall remain in full force and effect, until and except as modified
hereby or in connection herewith. Notwithstanding any provision of this
Agreement that may be to the contrary, the provisions of Section 11.04 of the
Existing Credit Agreement, including all defined terms used therein, will
continue to be effective as to all matters arising out of or in any way related
to facts or events existing or occurring prior to the Initial Closing Date.
II. THE LOANS
SECTION II.1. Commitments. (a) Subject to the terms and conditions
and relying upon the representations and warranties herein set forth, each
Lender, severally and not jointly, agrees to make Loans to the Borrowers, at any
time and from time to time from the date hereof to the Termination Date, in an
aggregate principal amount at any time outstanding not to exceed the amount of
such Lender's Commitment set forth opposite its name in Schedule 2.01 annexed
hereto, as such Commitment may be reduced from time to time in accordance with
the provisions of this Agreement. Notwithstanding the foregoing and subject to
Section 2.20 hereof, the aggregate principal amount of Loans outstanding at any
time to the Borrowers shall not exceed (1) the lesser of (A) the Total
Commitment (as such amount may be reduced pursuant to Section 2.07 hereof) and
(B) an amount equal to the sum of (i) up to sixty-five percent (65%) of the
aggregate Net Amount of Eligible Inventory of the Borrowers, plus (ii) subject
to the terms of Sections 2.07(b) and 2.09(d) hereof, the Supplemental
Availability then in effect (this clause (1) (B) referred to herein as the
"Borrowing Base"), minus (2) the Letter of Credit Usage at such time (which
Letter of Credit Usage shall not exceed $30,000,000 at any time), minus
(3) reserves established pursuant to Section 2.01(c) below at such time. The
Borrowing Base will be computed as provided in Section 2.20 hereof, and the
Borrowing Base and other collateral reporting material will be delivered to the
Agent in accordance with Section 6.05(g) and/or Section 6.05(h) hereof. In no
event shall the aggregate outstanding Loans and Letters of Credit made to or for
the account of any Borrower exceed the Maximum Facility Amount for such
Borrower.
(b) Subject to the foregoing and within the foregoing limits, and
subject to all other applicable terms, provisions and limitations set forth in
this Agreement, the Borrowers may borrow, repay (or, subject to the provisions
of Section 2.09 hereof, prepay) and reborrow Loans, on and after the date hereof
and prior to the Termination Date.
(c) The Agent may from time to time decrease the Loans and Letters of
Credit available to the Borrowers by an amount equal to the aggregate amount of
all reserves which the Agent deems necessary or desirable to maintain hereunder,
such reserves to be determined by the Agent in its judgment exercised in good
faith and to include, without limitation, reserves instituted under
Section 2.07(b) or Section 2.09(e) or reserves with respect to (i) rent payments
past due and owing by any Borrower with respect to premises leased by any
Borrower for which a Landlord Waiver has not been obtained, (ii) trust fund
liabilities under the Perishable Agricultural Commodities Act and the Packers
and Stockyards Act, (iii) environmental remediation and liability, (iv) Liens on
Collateral (other than Liens in existence on the Initial Closing Date which are
listed on Schedule 7.01 and other than encumbrances permitted under
Section 7.01), (v) credit exposure of any Borrower with respect to interest rate
protection arrangements, (vi) reserves contemplated by Section 5.02(i)(ii) and
(vii) 103% of the
face amount of letters of credit issued by persons other than the Letter of
Credit Issuer for the account of any Borrower or any subsidiary thereof.
SECTION II.2. Loans. (a) The Eurodollar Loans made by the Lenders
on any date shall be in integral multiples of $1,000,000 and in a minimum
aggregate principal amount of $1,000,000.
(b) Subject to the provisions of Sections 2.17 and 2.18 hereof, Loans
shall be made ratably by the Lenders in accordance with their respective
Commitments; provided, however, that the failure of any Lender to make any Loan
shall not in itself relieve any other Lender of its obligation to lend
hereunder. The initial Loans shall be made by the Lenders against delivery of
Notes, payable to the order of the Lenders, as referred to in Section 2.04
hereof.
(c) Each Loan shall be either a Base Rate Loan or a Eurodollar Loan
as the Borrowers may request pursuant to Section 2.03 hereof. Each Lender may
fulfill its obligations under this Agreement by causing its Applicable Lending
Office to make such Loan; provided, however, that the exercise of such option
shall not affect the obligation of the Borrowers to repay such Loan in
accordance with the term of the Notes. Not more than six (6) Eurodollar Loans
may be outstanding at any one time.
(d) Subject to the provisions of Sections 2.17 and 2.18 hereof, each
Lender shall make its Loans on the proposed dates thereof by paying the amount
required to the Agent in New York, New York in immediately available funds not
later than 2:00 p.m., New York City time, and the Agent shall as soon as
practicable, but in no event later than 3:00 p.m., New York City time, credit
the amounts so received to the general deposit account of the applicable
Borrower with the Agent in immediately available funds or, if Loans are not to
be made on such date because any condition precedent to a borrowing herein
specified is not met, return the amounts so received to the respective Lenders.
(e) The Borrowers shall have the right at any time upon prior
irrevocable written, telex or facsimile notice (promptly confirmed in writing)
to the Agent given in the manner and at the times specified in Section 2.03
hereof with respect to the Loans into which conversion or continuation is to be
made, to convert all or any portion of Eurodollar Loans into Base Rate Loans, to
convert all or any portion of Base Rate Loans into Eurodollar Loans (specifying
the Interest Period to be applicable thereto) and to continue all or any portion
of any Eurodollar Loans into a subsequent Interest Period selected by the
Borrowers in accordance with the terms hereof, in each instance subject to the
terms and conditions of this Agreement (including the last sentence of
Section 2.02(c) hereof) and to the following:
(i) in the case of a conversion or continuation of fewer than all the
Loans, the aggregate principal amount of Loans (A) converted shall
not be less than $1,000,000 in the case of Base Rate Loans or (B) converted
or continued shall not be less than $1,000,000 in the case of Eurodollar
Loans and shall be an integral multiple of $1,000,000;
(ii) accrued interest on a Loan (or portion thereof) being converted
or continued shall be paid by the Borrowers at the time of conversion or
continuation;
(iii) if any Eurodollar Loan is converted at any time other than
the end of an Interest Period applicable thereto, the Borrowers shall make such
payments associated therewith as are required pursuant to Section 2.12 hereof;
(iv) any portion of a Eurodollar Loan which is subject to an Interest
Period ending on a date that is less than three (3) months prior to the
Termination Date may not be converted into, or continued as, a Eurodollar Loan
and shall be automatically converted at the end of such Interest Period into a
Base Rate Loan; and
(v) no Default or Event of Default shall have occurred and be
continuing.
The Interest Period applicable to any Eurodollar Loan resulting from a
conversion or continuation shall be specified by Jitney Jungle in the
irrevocable notice of conversion or continuation delivered pursuant to this
Section; provided, however, that if no such Interest Period shall be specified,
the Borrowers shall be deemed to have selected an Interest Period of one (1)
month's duration. If the Borrowers shall not have given timely notice to
continue any Eurodollar Loan into a subsequent Interest Period (and shall not
otherwise have given notice to convert such Loan), such Loan (unless repaid or
required to be repaid pursuant to the terms hereof) shall, subject to (iv)
above, automatically be converted into a Base Rate Loan.
SECTION II.3. Notice of Loans. Jitney Jungle shall, through a
Responsible Officer, give the Agent irrevocable written, telex or facsimile
notice (promptly confirmed in writing) of each borrowing (including, without
limitation, a conversion as permitted by Section 2.02(e) hereof) (i) not later
than 11:00 A.M., New York City time, three (3) Business Days before a proposed
Eurodollar Loan borrowing or conversion and (ii) not later than 1:00 P.M., New
York City time on the Business Day of the requested Base Rate Loan borrowing or
conversion. Such notice shall specify (w) whether the Loans then being
requested are to be Base Rate Loans or Eurodollar Loans, (x) the date of such
borrowing (which shall be a Business Day) and amount thereof, (y) if such Loans
are to be Eurodollar Loans, the Interest Period with respect thereto and (z) the
Borrower for whose account such borrowing is being made. If no election as to
the type of Loan is specified in any such notice, all such Loans shall
be Base Rate Loans. If no Interest Period with respect to any Eurodollar
Loan is specified in any such notice, then an Interest Period of one (1)
month's duration shall be deemed to have been selected. The Agent shall
promptly advise the Lenders of any notice given pursuant to this Section 2.03
and of each Lender's portion of the requested borrowing.
SECTION II.4. Notes; Repayment of Loans. (a) All Loans made by a
Lender to the Borrowers shall be evidenced by a single Note, duly executed on
behalf of the Borrowers, dated the Initial Closing Date, in substantially the
form of Exhibit A annexed hereto, delivered and payable to such Lender in a
principal amount equal to its Commitment in respect of the Borrowers on such
date. The outstanding balance of each Loan, as evidenced by any such Note,
shall mature and be due and payable on the Termination Date.
(b) Each Note shall bear interest from its date on the outstanding
principal balance thereof, as provided in Section 2.05 hereof.
(c) Each Lender, or the Agent on its behalf, shall, and is hereby
authorized by the Borrowers to, endorse on the schedule attached to the Notes of
such Lender (or on a continuation of such schedule attached to such Note and
made a part thereof) an appropriate notation evidencing the date and amount of
each Loan to the Borrowers from such Lender, as well as the date and amount of
each payment and prepayment with respect thereto; provided, however, that the
failure of any person to make such a notation on a Note shall not affect any
obligations of the Borrowers under such Note. Any such notation shall be
conclusive and binding as to the date and amount of such Loan or portion
thereof, or payment or prepayment of principal or interest thereon, absent
manifest error.
(d) Each Borrower hereby irrevocably authorizes and directs the Agent
on behalf of itself and the Lenders to charge the accounts of the Borrowers with
the Agent for all amounts which may now or hereafter be due and payable by any
Borrower and its subsidiaries hereunder or under any other Loan Document,
including, without limitation, all amounts of principal and interest, fees and
expenses. If at any time there is not sufficient availability to cover any of
the payments referred to in the prior sentence, and, in any event, upon the
occurrence and during the continuance of any Event of Default, the Borrowers
shall make any such payments to the Agent on demand.
SECTION II.5. Interest on Loans. (a) Subject to the provisions of
Sections 2.05(c) and Section 2.08 hereof, each Base Rate Loan shall bear
interest at a rate per annum equal to the Base Rate plus the Applicable Margin.
(b) Subject to the provisions of Section 2.05(c) and Section 2.08
hereof, each Eurodollar Loan shall bear interest at a rate per annum equal to
the Adjusted LIBO Rate plus the Applicable Margin.
(c) Interest on each Loan shall be payable in arrears on each
applicable Interest Payment Date and on the maturity thereof (whether as
scheduled, by acceleration or otherwise). Interest on each Base Rate Loan and
each Eurodollar Loan shall be computed based on the number of days elapsed in a
year of 365 days. The Agent shall determine each interest rate applicable to
the Loans and shall promptly advise the Borrowers and the Lenders of the
interest rate so determined (which determination shall be conclusive and binding
on the Borrowers and the Lenders absent manifest error).
SECTION II.6. Fees. (a) The Borrowers shall pay each Lender,
through the Agent, (i) on the last Business Day of each March, June, September
and December in arrears commencing on September 30, 1997, (ii) on the date of
any reduction of the Commitment pursuant to Section 2.07 hereof and (iii) on the
Termination Date, in immediately available funds, a Commitment Fee on the
average amount, calculated on a daily basis, by which the Commitment of such
Lender, during the calendar quarter (or shorter period commencing with the date
hereof or ending with the Termination Date) ending on such date exceeds the
aggregate outstanding principal amount of the Loans made by such Lender and such
Lender's pro rata share of the aggregate undrawn amount of all outstanding
Letters of Credit. The Commitment Fee due to each Lender under this
Section 2.06 shall commence to accrue on the Initial Closing Date and cease to
accrue on the earlier of (i) the Termination Date and (ii) the termination of
the Commitment of such Lender pursuant to Section 2.07 hereof. The Commitment
Fee shall be calculated on the basis of the actual number of days elapsed in a
year of 365 days.
(b) The Borrowers shall pay to the Agent and/or Fleet for their
respective accounts the fees payable in the Fee Letter and other letters to be
entered into when and as such fees are due and payable as therein provided.
(c) All fees payable under or in connection with this Agreement shall
be fully earned upon payment and shall be nonrefundable in all circumstances.
SECTION II.7. Termination of Commitments and Commitment Reductions.
(a) Upon at least ten (10) Business Days' prior irrevocable written notice (or
facsimile notice promptly confirmed in writing) to the Agent, the Borrowers may
at any time in whole permanently terminate, or from time to time in part
permanently reduce, the Total Commitment and/or the Supplemental Availability,
ratably among the Lenders in accordance with the amounts of their respective
Commitments; provided, however, that the Total Commitment shall not be reduced
at any time to an amount less than the Loans outstanding under the Commitment
and the Letter of Credit Usage at such time. Each partial reduction of the
Total Commitment and/or the Supplemental Availability shall be in a minimum of
$1,000,000 and an integral multiple of $500,000.
(b) (i) The Supplemental Availability shall be permanently reduced
on each of the dates set forth below by the amount set forth below opposite such
date (such reduced amount being the Supplemental Availability in effect for the
next succeeding calendar quarter), and on each such date, the Total Commitment
shall be permanently reduced by an amount equal to such reduction:
Supplemental Availability
Reduction Date Amount
September 30, 1998 $1,250,000
December 31, 1998 $1,250,000
March 31, 1999 $1,250,000
June 30, 1999 $1,250,000
September 30, 1999 $1,750,000
December 31, 1999 $1,750,000
March 31, 2000 $1,750,000
June 30, 2000 $1,750,000
September 30, 2000 $2,000,000
December 31, 2000 $2,000,000
March 31, 2001 $2,000,000
June 30, 2001 $2,000,000
September 30, 2001 $2,250,000
December 31, 2001 $2,250,000
March 31, 2002 $2,250,000
June 30, 2002 $2,250,000
September 30, 2002 $2,750,000
December 31, 2002 $2,750,000
March 31, 2003 $2,750,000
June 30, 2003 $2,750,000
September 30, 2003 $6,500,000
December 31, 2003 $6,500,000
(ii) (A) In addition, on each date that a prepayment of principal of
the Loans is required pursuant to Section 2.09(d)(i), Section 2.09(d)(ii),
Section 2.09(d)(iii) or Section 2.09(d)(iv), the Supplemental Availability under
Section 2.01(a) and the Total Commitment shall each be permanently reduced by an
amount equal to such prepayment.
(B) Within ninety (90) days after the end of each Fiscal Year,
beginning with the Fiscal Year ending on or about May 2, 1998, the Supplemental
Availability and the Total Commitment shall each be permanently reduced in an
amount equal to the lesser of (x) fifty percent (50%) of Excess Cash Flow for
such Fiscal Year calculated on the basis of the audited financial statements for
such Fiscal Year delivered to the Agent and the Lenders pursuant to Section
6.05(a) and (y) $7,000,000; provided, that if such financial statements shall
duly reflect that the Leverage Ratio for the four consecutive fiscal quarters
ending on the last day of such Fiscal Year shall have been equal to or less than
3.5 to 1.0, then no reduction shall be required by this clause (B). Concurrently
with the making of any such reduction, the Borrowers shall deliver to the Agent
and the Lenders a certificate of the Financial Officer of Jitney Jungle
demonstrating the calculation of the amount required to be reduced hereunder.
(C) The Commitment of each Lender shall automatically and
permanently terminate on the Termination Date unless extended as herein
provided, and all Loans still outstanding on such date shall be due and payable
in full together with accrued interest thereon.
(iii) In the event that a prepayment of principal of the Loans is
required pursuant to or is made under Section 2.09(e) and (A) the aggregate
amount of proceeds and awards received under Section 2.09(e) in such calendar
year (including the proceeds received on the date of determination) is less than
$2,000,000, then no reduction of Total Commitment or Supplemental Availability
shall be required under this
Section 2.07(b); and (B) the aggregate amount of proceeds and awards received
under Section 2.09(e) in such calendar year (including the proceeds received
on the date of determination) is greater than $2,000,000, then the Total
Commitment and the Supplemental Availability shall be reduced by the amount
of the prepayment required by or made under Section 2.09(e).
(iv) Each prepayment of principal of the Loans required to be made in
reduction of the Total Commitment and the Supplemental Availability pursuant to
Section 2.07(ii)(A) or 2.07(ii)(B) above shall be applied to prepay (or reduce)
the scheduled reductions of the Total Commitment and the Supplemental
Availability pursuant to Section 2.07(b)(i) above on a pro rata basis (based
upon the then remaining principal amount of the scheduled reductions thereto
pursuant to Section 2.07(b)(i)) until the Supplemental Availability shall have
been reduced to zero, with each such prepayment (or reduction) being prepaid (or
reduced) by an amount equal to the product of the prepayment or reduction amount
applicable to the Supplemental Availability, multiplied by a fraction the
numerator of which is the scheduled reduction pursuant to Section 2.07(b)(i) (as
reduced by prepayments previously made) and the denominator of which shall be
the remaining Supplemental Availability.
(c) Simultaneously with any termination of the Total Commitment
pursuant to paragraph (a) or (b) of this Section 2.07, the Borrowers shall pay
to each Lender, through the Agent, the Commitment Fee due and owing through and
including the date of such termination or reduction on the amount of the
Commitment of such Lender so terminated or reduced.
SECTION II.8. Interest on Overdue Amounts. (a) If there shall occur
and be continuing any Event of Default, the Borrowers shall on demand from time
to time pay interest, to the extent permitted by law, on principal, interest,
fees and any other amount which is payable hereunder or under any other Loan
Document (whether then due and payable or not) (after as well as before
judgment) at a rate per annum equal to two percent (2%) in excess of the rates
otherwise applicable thereto (or if no rate is applicable thereto, at a rate per
annum equal to four percent (4%) in excess of the Prime Rate).
(b) In the event, and on each occasion, that on the day two
(2) Business Days prior to the commencement of any Interest Period for a
Eurodollar Loan the Agent shall have determined that dollar deposits in the
amount of each Eurodollar Loan are not generally available in the London
interbank market, or that the rate at which dollar deposits are being offered
will not reflect adequately and fairly the cost to one or more Lenders of making
or maintaining such Eurodollar Loan during such Interest Period, or that
reasonable means do not exist for ascertaining the Adjusted LIBO Rate, the Agent
shall as soon as practicable thereafter give written notice (or facsimile notice
promptly confirmed in writing) of such determination to the Borrowers and the
Lenders, and any request by any Borrower for the making of a
Eurodollar Loan pursuant to Section 2.03 hereof or conversion or continuation
of any Loan into a Eurodollar Loan pursuant to Section 2.02 hereof shall,
until the circumstances giving rise to such notice no longer exist, be deemed
to be a request for a Base Rate Loan. Each determination by the Agent made
hereunder shall be conclusive absent manifest error.
Notwithstanding any other provisions of this Section 2.08, no Lender
shall apply or request that the Agent apply the provisions of subsection (b) of
this Section 2.08 with respect to the Borrower if it shall not at the time be
the general policy or practice of such Lender to apply the provisions of
subsection (b) of this Section 2.08 to other borrowers in substantially similar
circumstances under substantially comparable provisions of other credit
agreements.
SECTION II.9. Prepayment of Loans. (a) Subject to the terms and
conditions contained in this Section 2.09 and elsewhere in this Agreement, the
Borrowers shall have the right to prepay any Loan at any time in whole or from
time to time in part (except in the case of a Eurodollar Loan, only on the last
day of an Interest Period therefor) without penalty (except as otherwise
provided for herein); provided, however, that each such partial prepayment of a
Eurodollar Loan shall be in an integral multiple of $1,000,000.
(b) On the date of any termination of the Total Commitment pursuant
to Section 2.07(a) hereof or elsewhere in this Agreement, the Borrowers shall
pay the aggregate principal amount of all Loans then outstanding, together with
interest to the date of such payment and all fees and other amounts due under
this Agreement and deposit in a cash collateral account with the Agent on terms
satisfactory to the Agent an amount equal to 103% of the amount of the Letter of
Credit Usage. Any prepayments required by this paragraph (b) shall be applied
to outstanding Base Rate Loans up to the full amount thereof before they are
applied to outstanding Eurodollar Loans; provided, however, that the Borrowers
shall not be required to make any prepayment of any Eurodollar Loan pursuant to
this Section until the last day of the Interest Period with respect thereto so
long as an amount equal to such prepayment is deposited by the Borrowers in a
cash collateral account with the Agent to be held in such account on terms
satisfactory to the Agent.
(c) The Borrowers shall make prepayments of the Loans from time to
time (including without limitation prepayments required by any reduction of
Total Commitment and/or the Supplemental Availability) such that the outstanding
principal balance of the Loans plus the Letter of Credit Usage plus the reserves
then in effect under Section 2.01(c) hereof do not exceed the lesser of (i) the
Total Commitment and (ii) the Borrowing Base at such time. Any prepayments
required by this paragraph (c) shall be applied to outstanding Base Rate Loans
up to the full amount thereof before they are applied to outstanding Eurodollar
Loans; provided, however, that the Borrowers shall not be required to make any
prepayment of any Eurodollar Loan
pursuant to this Section until the last day of the Interest Period with
respect thereto so long as an amount equal to such prepayment is deposited by
the Borrowers in a cash collateral account with the Agent to be held in such
account on terms satisfactory to the Agent. In the event that after the
prepayment in full (or cash collateralization thereof as provided above) of
the Loans, the Letter of Credit Usage plus the reserves then in effect under
Section 2.01(c) hereof shall still exceed the lesser of (i) the Total
Commitment and (ii) the Borrowing Base, the Borrowers shall deposit cash in
the amount of such excess with the Agent in a cash collateral account with
the Agent to be held in such account on terms satisfactory to the Agent.
(d) (i) Within five Business Days of the receipt thereof by any
Borrower, any Grantor, any Guarantor or any subsidiary of any of them of Cash
Proceeds from any Asset Sale (other than an Asset Sale of an FTC Divestiture
Store), the Borrowers shall make a mandatory prepayment of the Loans in an
amount equal to 100% of the Net Cash Proceeds thereof, which proceeds shall be
applied as set forth in paragraph (f) below; provided, that up to an aggregate
of $1,000,000 per fiscal year but not to exceed $5,000,000 of Net Cash Proceeds
from Asset Sales from the Initial Closing Date through the Final Maturity Date
shall not be required to be used to so repay Loans to the extent the Borrowers
elect, as hereinafter provided, to cause such Net Cash Proceeds to be reinvested
in Reinvestment Assets (a "Reinvestment Election"). The Borrowers may exercise
their Reinvestment Election (within the parameters specified in the preceding
sentence) with respect to an Asset Sale if (x) at the time of such election
there is continuing no Default or Event of Default and (y) the Borrowers deliver
a Reinvestment Notice to the Agent no later than the fifteenth Business Day
following the date of the consummation of the respective Asset Sale, with such
Reinvestment Election being effective with respect to the Net Cash Proceeds of
such Asset Sale equal to the Anticipated Reinvestment Amount specified in such
Reinvestment Notice. The Borrowers agree to grant a first priority security
interest (subject only to Liens permitted by clause (a), (b), (c), (d), (f),
(h), (i) or (j) of Section 7.01) in such Reinvestment Assets in favor of the
Agent, such security interest to be granted on the date of acquisition of such
Reinvestment Assets by any Borrower. Nothing contained in this paragraph shall
constitute, or be deemed to constitute, a consent to any such Asset Sale.
(ii) Within five Business Days of (A) the sale, issuance or other
disposition by any Borrower, any Guarantor or any subsidiary of either thereof
of any of its capital stock or other equity interests in such person or any
option, warrant or similar right to acquire any of same (except pursuant to the
Original Acquisition Documents and the Merger Documents and except sales by
Jitney Jungle of its capital stock to employees of the Borrowers following
purchases thereof in an aggregate amount not in excess of $1,000,000 during the
term of this Agreement as permitted by Section 7.04(ii)), (B) the consummation
of the issuance of any debt securities of any Borrower, any Guarantor or any of
their respective subsidiaries (except the Senior Notes and the Senior
Subordinated Notes), (C) the receipt by any Borrower of any
monies in accordance with the Original Acquisition Documents or the Merger
Agreement (other than indemnification payments made under any Original
Acquisition Document or the Merger Agreement on account of third-party claims
against the Borrowers or any subsidiary thereof), or (D) the incurrence by
any Borrower of any Subordinated Indebtedness (other than pursuant to the
Senior Subordinated Indenture), the Borrower who is the recipient of such
amounts shall make a mandatory prepayment of the Loans in an amount equal to
100% of the proceeds received (net of taxes due and any reasonable expenses
of sale), which proceeds shall be applied as set forth in paragraph (f)
below. Nothing contained in this paragraph shall constitute, or be deemed
to constitute, a consent to any sale of assets or stock or other equity
interests or the issuance or incurrence of any Indebtedness.
(iii) On the Reinvestment Prepayment Date with respect to a
Reinvestment Election, the Borrowers shall make a mandatory prepayment of the
Loans in an amount equal to the Reinvestment Prepayment Amount, if any, for such
Reinvestment Election, which proceeds shall be applied as set forth in paragraph
(f) below.
(iv) In the event that by virtue of an Asset Sale of an FTC
Divestiture Store, a payment would become due and owing under the Senior
Indenture or the Senior Subordinated Indenture in connection therewith, the
Borrowers shall make a mandatory prepayment of the Loans in an amount equal to
100% of the Net Cash Proceeds thereof such that the Borrowers shall have no
obligation to make a prepayment under the Senior Indenture or the Senior
Subordinated Indenture (as applicable), which prepayment shall be applied as set
forth in paragraph (f) below.
(e) (i) Except as provided in clause (ii) below, not later than the
fifth Business Day following the receipt by the Agent or any Borrower, any
Guarantor or any of their respective subsidiaries (x) of any net proceeds of any
insurance required to be maintained pursuant to Section 6.03 hereof on account
of any loss, damage or injury to any asset of any Borrower, any Guarantor or
such subsidiary (including, without limitation, any Collateral) or of any
condemnation or eminent domain awards with respect to any real property or
improvements thereon owned by any Borrower, any Guarantor or any of their
respective subsidiaries, or (y) of any net proceeds of any business interruption
insurance required to be maintained pursuant to Section 6.03 hereof, such
Borrower, such Guarantor or such subsidiary shall notify the Agent of such
receipt in writing or by telephone promptly confirmed in writing, and not later
than the fifth Business Day following receipt by the Agent or such Borrower,
such Guarantor or such subsidiary of any such proceeds or awards, there shall
become due and payable a prepayment of the Loans in an amount equal to 100% of
such proceeds or award. Prepayments from such net proceeds or award shall be
applied as set forth in paragraph (f) below.
(ii) In the case of the receipt of net proceeds or awards
described in clause (i) above with respect to the loss, damage or injury to any
asset of any Borrower, any Guarantor or any of their respective subsidiaries or
the condemnation or taking by eminent domain of any real property or
improvements thereon owned by any Borrower, any Guarantor or any of their
respective subsidiaries (other than net proceeds of any business interruption
insurance), such Borrower, such Guarantor or such subsidiary may elect, by
written notice delivered to the Agent not later than the day on which a
prepayment would otherwise be required under clause (i), to apply all or a
portion of such net proceeds or award for the purpose of replacing, repairing,
restoring or rebuilding the relevant tangible property, and, in such event, any
required prepayment under clause (i) above shall be reduced dollar for dollar by
the amount of such election. An election under this clause (ii) shall not be
effective unless: (x) at the time of such election there is continuing no
Default or Event of Default; (y) the Borrowers shall have certified to the Agent
that: (1) the net proceeds of the insurance adjustment for such loss, damage or
injury or the amount of such award, together with other funds available to the
Borrowers, shall be substantially sufficient to complete such replacement,
repair, restoration or rebuilding in accordance with all applicable laws,
regulations and ordinances; and (2) to the best knowledge of the Borrowers, no
Default or Event of Default has arisen or will arise as a result of such loss,
damage, injury, condemnation, taking, replacement, repair or rebuilding; and (z)
if the amount of net proceeds or awards in all such cases is equal to or greater
than $1,500,000 in the aggregate in any calendar year (including the proceeds
received on the date of determination), the Borrowers shall have obtained the
written consent of the Agent to such election. In the event that any net
proceeds or awards described in clause (i) above are received with respect to
any equipment or other personal property and are not applied within 90 days of
receipt thereof as provided in this clause (ii), then the full amount of such
proceeds and awards shall be applied as a prepayment of the Loans. In the event
that any net proceeds or awards described in clause (i) above are received with
respect to any real property or improvements thereon, (x) within 90 days of such
loss, damage or injury thereto or the condemnation or taking thereof, the
Borrowers shall deliver plans, specifications and other relevant particulars to
the Agent with respect to the replacement, repair, restoration or rebuilding
thereof, in form and substance reasonably satisfactory to the Agent, (y) the
Agent, at its option, shall be entitled to institute a reserve pursuant to
Section 2.01(c) in an amount equal to the amount of the prepayment required
under clause (i) above with respect to such loss, damage, injury, condemnation
or taking and (z) if such proceeds or awards are not applied within one year of
receipt thereof as provided in this clause (ii) and in accordance with the
foregoing plans, specifications and other relevant particulars, then the full
amount of such proceeds and awards shall be applied as a prepayment of the
Loans. The Borrowers agree to grant a first priority security interest (subject
only to Liens permitted by clause (a), (b), (c), (d), (f), (h), (i) or (j) of
Section 7.01) in such replacement assets in favor of the Agent, such security
interest to be granted on the date of acquisition of such replacement assets by
any Borrower.
(iii) In the event of an election under clause (ii) above,
pending
application of the net proceeds or award to the required replacement,
repairs, restoration or rebuilding, such Borrower, such Guarantor or such
subsidiary shall not later than the time at which prepayment would have been,
in the absence of such election, required under clause (i) above, apply such
net proceeds or award to the prepayment of the outstanding principal balance,
if any, of the Loans (not in permanent reduction of the Commitment), and
deposit (the "Special Deposit") with the Agent, the balance, if any, of such
net proceeds or award remaining after such application, pursuant to
agreements in form, scope and substance reasonably satisfactory to the Agent.
The Special Deposit, together with all earnings on such Special Deposit,
shall be available to the Borrowers solely for the replacement, repair,
rebuilding or restoration of the tangible property suffering the injury,
loss, damage condemnation or taking by eminent domain in respect of which
such prepayment and Special Deposit were made or to such other purpose as to
which the Agent may consent in writing; provided, however, that at such time
as a Default or Event of Default shall occur, the balance of the Special
Deposit and earnings thereon may be applied by the Agent to repay the
Obligations in such order as the Agent shall elect. The Agent shall be
entitled to require proof, as a condition to the making of any withdrawal
from the Special Deposit, that the proceeds of such withdrawal are being
applied for the purposes permitted hereunder.
(iv) Subject to the provisions of this paragraph (e), promptly
upon the receipt by the Agent or any Borrower, any Guarantor or any of their
respective subsidiaries of any net proceeds of any insurance referred to in
Section 6.03 hereof, there shall become due and payable a prepayment of
principal in respect of the Obligations in an amount equal to 100% of such net
proceeds. All prepayments made pursuant to this clause (iv) shall be applied in
the manner set forth in paragraph (f) below.
(f) When making a prepayment, whether mandatory or otherwise,
pursuant to paragraph (a), (b), (c), (d) or (e) above, the applicable Borrower
shall furnish to the Agent, not later than 12:00 noon (New York City time)
(i) five (5) Business Days prior to the date of such prepayment of Base Rate
Loans and (ii) five (5) Business Days prior to the date of such prepayment of
Eurodollar Loans, written, telex or facsimile notice (promptly confirmed in
writing) of prepayment which shall specify the prepayment date and the principal
amount of each Loan (or portion thereof) to be prepaid, which notice shall be
irrevocable and shall commit the Borrowers to prepay such Loan by the amount
stated therein on the date stated therein. All prepayments shall be accompanied
by accrued interest on the principal amount being prepaid to the date of
prepayment. Prepayments made pursuant to paragraph (d) or (e) above shall be
applied to outstanding Base Rate Loans up to the full amount thereof and then to
Eurodollar Loans up to the full amount thereof; provided, however, that if at
the time of the making of any such prepayment, a Default or an Event of Default
is in existence and there are undrawn Letters of Credit outstanding, then in the
discretion of the Agent, all or a portion of any such prepayment (not to exceed
an amount equal to the
aggregate undrawn amount of all such outstanding Letters of Credit) shall be
deposited by the Borrower in a cash collateral account to be held by the
Agent for the benefit of the Lenders for application by the Agent to the
payment of any drawing made under any such Letters of Credit (the foregoing
requirement to be in addition to any other cash collateral requirements under
this Agreement); and, provided, further, that the Borrowers shall not be
required to make any prepayment of any Eurodollar Loan required pursuant to
this Section 2.09(f) until the last day of the Interest Period with respect
thereto so long as an amount equal to such prepayment is deposited by the
Borrowers into a cash collateral account with the Agent to be held in such
account pursuant to terms satisfactory to the Agent. All payments made by a
Borrower as described in this clause (f) shall be first deemed to be a
repayment of a Loan (or collateral for Letter of Credit Usage) made for the
account of such Borrower, and to the extent that the Loans and Letter of
Credit Usage for the account of such Borrower is reduced to zero, such
payments shall be deemed to be applied to such Loans and Letter of Credit
Usage as the Agent shall determine in its sole discretion.
(g) All prepayments under this Section 2.09 shall be subject to
Section 2.12 hereof.
(h) Except as otherwise expressly provided in this Section 2.09,
payments with respect to any paragraph of this Section 2.09 are in addition to
payments made or required to be made under any other paragraph of this
Section 2.09.
SECTION II.10. Reserve Requirements; Change in Circumstances.
(a) Notwithstanding any other provision herein, if after the date of this
Agreement (or in the case of any assignee of any Lender, the date such assignee
becomes a Lender hereunder) any change in applicable law or regulation or in the
interpretation or administration thereof by any governmental authority charged
with the interpretation or administration thereof (whether or not having the
force of law) shall (i) subject the Agent or any Lender (which shall for the
purpose of this Section 2.10 include any assignee or lending office or branch of
the Agent or any Lender) to any tax with respect to any amount paid or to be
paid by either the Agent or any Lender with respect to any Eurodollar Loans made
by a Lender to a Borrower (other than (x) taxes imposed on the overall net
income of the Agent or such Lender and (y) franchise taxes imposed on the Agent
or such Lender, in either case by the jurisdiction in which such Lender or the
Agent has its principal office or its lending office with respect to such
Eurodollar Loan or any political subdivision or taxing authority of either
thereof); (ii) change the basis of taxation of payments to any Lender or the
Agent of the principal of or interest on any Eurodollar Loan or any other fees
or amounts payable hereunder (other than taxes imposed on the overall net income
of such Lender or the Agent by the jurisdiction in which such Lender or the
Agent has its principal office or by any political subdivision or taxing
authority therein); (iii) impose, modify or deem applicable any reserve, special
deposit or similar requirement against assets of, deposits with or for the
account of, or loans or loan commitments extended by, such Lender; or (iv)
impose on any Lender or
the London interbank market any other condition affecting this Agreement or
Eurodollar Loans made by such Lender; and the result of any of the foregoing
shall be to increase the cost to any such Lender of making or maintaining any
Eurodollar Loan, or to reduce the amount of any payment (whether of
principal, interest or otherwise) receivable by such Lender or to require
such Lender to make any payment in respect of any Eurodollar Loan, then the
Borrowers shall pay to such Lender or the Agent, as the case may be, upon
such Lender's or the Agent's demand, such additional amount or amounts as
will compensate such Lender or the Agent for such additional costs or
reduction. The Agent and each Lender agree to give notice to the Borrowers of
any such change in law, regulation, interpretation or administration with
reasonable promptness after becoming actually aware thereof and of the
applicability thereof to the Transactions and, at the request of the
Borrowers, shall set out in reasonable detail the calculations used in
determining such additional amounts. Notwithstanding anything contained
herein to the contrary, nothing in clause (i) or (ii) of this Section 2.10(a)
shall be deemed to (x) permit the Agent or any Lender to recover any amount
thereunder which would not be recoverable under Section 2.15 hereof or (y)
require the Borrowers to make any payment of any amount to the extent that
such payment would duplicate any payment made by the Borrowers pursuant to
Section 2.15 hereof.
Notwithstanding any other provision of this Section 2.10, no Lender
shall demand any payment referred to above if it shall not at the time be the
general policy or practice of such Lender to demand such compensation in
substantially similar circumstances under substantially comparable provisions of
other credit agreements.
(b) If at any time and from time to time after the date of this
Agreement, any Lender shall determine that the adoption of any applicable law,
rule, regulation or guideline regarding capital adequacy, or any change in any
applicable law, rule, regulation or guideline regarding capital adequacy, or any
change in the interpretation or administration of any thereof by any
governmental authority, central bank or comparable agency charged with the
interpretation or administration thereof, or compliance by such Lender (or its
lending office or an affiliate) with any request or directive regarding capital
adequacy (whether or not having the force of law) of any such authority, central
bank or comparable agency, has or will have the effect of reducing the rate of
return on such Lender's or its affiliate's capital as a consequence of such
Lender's obligations hereunder to a level below that which such Lender or
affiliate could have achieved but for such adoption, change or compliance
(taking into consideration such Lender's or its affiliate's policies with
respect to capital adequacy), then from time to time the Borrowers shall pay to
such Lender such additional amount or amounts as will compensate such Lender or
its affiliate for such reduction.
Notwithstanding any other provision of this Section 2.10, no Lender
shall demand any payment referred to above if it shall not at the time be the
general policy or practice of such Lender to demand such compensation in
substantially similar circumstances under substantially comparable provisions of
other credit agreements.
(c) A statement of any Lender or the Agent setting forth such amount
or amounts, supported by calculations in reasonable detail, as shall be
necessary to compensate such Lender or its affiliate (or the Agent) as specified
in paragraphs (a) and (b) above shall be delivered to the Borrowers and shall be
conclusive absent manifest error. The Borrowers shall pay each Lender or the
Agent the amount shown as due on any such statement within ten (10) days after
its receipt of the same.
(d) Failure on the part of any Lender or the Agent to demand
compensation for any increased costs, reduction in amounts received or
receivable with respect to any Interest Period or reduction in the rate of
return earned on such Lender's or its affiliate's capital, shall not constitute
a waiver of such Lender's or the Agent's rights to demand compensation for any
increased costs or reduction in amounts received or receivable or reduction in
rate of return in such Interest Period or in any other Interest Period. The
protection under this Section 2.10 shall be available to each Lender and the
Agent regardless of any possible contention of the invalidity or inapplicability
of any law, regulation or other condition which shall give rise to any demand by
such Lender or the Agent for compensation.
(e) Any Lender claiming any additional amounts payable pursuant to
this Section 2.10 agrees to use reasonable efforts (consistent with legal and
regulatory restrictions) to designate a different Applicable Lending Office if
the making of such a designation would avoid the need for, or reduce the amount
of, any such additional amounts and would not, in the sole judgment of such
Lender, be otherwise disadvantageous to such Lender.
SECTION II.11. Change in Legality. (a) Notwithstanding anything to
the contrary herein contained, if any change in any law or regulation or in the
interpretation thereof by any governmental authority charged with the
administration or interpretation thereof shall make it unlawful for any Lender
to make or maintain any Eurodollar Loan or to give effect to its obligations to
make Eurodollar Loans as contemplated hereby, then, by written notice to
Borrowers and to the Agent, such Lender may:
(i) declare that Eurodollar Loans will not thereafter be made by
such Lender hereunder, whereupon the Borrowers shall be prohibited
from requesting Eurodollar Loans from such Lender hereunder unless
such declaration is subsequently withdrawn; and
(ii) require that all outstanding Eurodollar Loans made by it be
converted to Base Rate Loans, in which event (A) all such Eurodollar
Loans shall be automatically converted to Base Rate Loans as of the
effective date of such notice as provided in paragraph (b) below and
(B) all payments of principal which would otherwise have been applied
to repay the converted Eurodollar Loans shall instead be applied to
repay
the Base Rate Loans resulting from the conversion of such
Eurodollar Loans.
(b) For purposes of Section 2.11(a) hereof, a notice to the Borrowers
by any Lender shall be effective, if lawful, on the last day of the then current
Interest Period or, if there are then two or more current Interest Periods, on
the last day of each such Interest Period, respectively; otherwise, such notice
shall be effective with respect to the Borrowers on the date of receipt by the
Borrowers.
SECTION II.12. Indemnity. Each Borrower shall indemnify each Lender
against any loss (including, without limitation, loss of anticipated profits) or
expense (including, but not limited to, any loss or expense sustained or
incurred or to be sustained or incurred in liquidating or employing deposits
from third parties acquired to affect or maintain any Loan or part thereof as a
Eurodollar Loan) which such Lender may sustain or incur as a consequence of the
following events (regardless of whether such events occur as a result of the
occurrence of an Event of Default or the exercise of any right or remedy of the
Agent or the Lenders under this Agreement or any other agreement, or at law):
any failure of any Borrower to fulfill on the date of any borrowing of a
Eurodollar Loan hereunder (including, without limitation, any conversion to or
continuation of a Eurodollar Loan or portion thereof) the applicable conditions
set forth in Article V hereof applicable to it; any failure of any Borrower to
borrow a Eurodollar Loan hereunder (including, without limitation, to convert to
or continue a Eurodollar Loan) after irrevocable notice of borrowing pursuant to
Section 2.03 hereof has been given; any payment, prepayment or conversion of a
Eurodollar Loan on a date other than the last day of the relevant Interest
Period; any default in payment or prepayment of the principal amount of any
Eurodollar Loan or any part thereof or interest accrued thereon, as and when due
and payable (at the due date thereof, by irrevocable notice of prepayment or
otherwise); or the occurrence of an Event of Default. Such loss or expense
shall include, without limitation, an amount equal to the excess, if any, of
(i) the amount of interest which would have accrued on the principal amount so
paid, prepaid or converted or not borrowed for the period from the date of such
payment, prepayment or conversion or failure to borrow to the last day of the
Interest Period for such Loan (or, in the case of a failure to borrow, the
Interest Period for such Loan which would have commenced on the date of such
failure to borrow), at the applicable rate of interest for such Loan provided
for herein over (ii) the amount of interest (as reasonably determined by such
Lender) that would be realized by such Lender in reemploying the funds so paid,
prepaid or converted or not borrowed in United States Treasury obligations with
comparable maturities for comparable periods. Any such Lender shall provide to
the Borrowers a statement, signed by an officer of such Lender, explaining any
loss or expense and setting forth, if applicable, the computation pursuant to
the preceding sentence, and such statement shall be conclusive absent manifest
error. The Borrowers shall pay such Lender the amount shown as due on any such
statement within three (3) Business Days after the receipt of the same.
SECTION II.13. Pro Rata Treatment. Except as otherwise provided
hereunder and subject to the provisions of Sections 2.17 and 2.18 hereof, each
borrowing, each payment or prepayment of principal of the Notes, each payment of
interest on the Notes, each payment of any fee or other amount payable hereunder
and each reduction of the Total Commitment and/or the Supplemental Availability
shall be made pro rata among the Lenders in the proportions that their
respective Commitments bear to the Total Commitment and/or the Supplemental
Availability, as applicable.
SECTION II.14. Sharing of Setoffs. Each Lender agrees that if it
shall, through the exercise of a right of banker's lien, setoff or counterclaim
against any Borrower, any Guarantor or any of their respective subsidiaries,
including, but not limited to, a secured claim under Section 506 of Title 11 of
the United States Code or other security or interest arising from, or in lieu
of, such secured claim, received by such Lender under any applicable bankruptcy,
insolvency or other similar law or otherwise, obtain payment (voluntary or
involuntary) in respect of a Note held by it as a result of which the unpaid
principal portion of the Notes held by it shall be proportionately less than the
unpaid principal portion of the Notes held by any other Lender, it shall be
deemed to have simultaneously purchased from such other Lender a participation
in the Notes held by such other Lender, so that the aggregate unpaid principal
amount of the Notes and participations in Notes held by it shall be in the same
proportion to the aggregate unpaid principal amount of all Notes then
outstanding as the principal amount of the Notes held by it prior to such
exercise of banker's lien, setoff or counterclaim was to the principal amount of
all Notes outstanding prior to such exercise of banker's lien, setoff or
counterclaim; provided, however, that if any such purchase or purchases or
adjustments shall be made pursuant to this Section 2.14 and the payment giving
rise thereto shall thereafter be recovered, such purchase or purchases or
adjustments shall be rescinded to the extent of such recovery and the purchase
price or prices or adjustments restored without interest. Each Borrower and
each Guarantor expressly consents to the foregoing arrangements and agrees that
any Lender holding a participation in a Note deemed to have been so purchased
may exercise any and all rights of banker's lien, setoff or counterclaim with
respect to any and all moneys owing to such Lender as fully as if such Lender
held a Note in the amount of such participation.
SECTION II.15. Taxes. (a) Any and all payments by the Borrowers
and/or Guarantors hereunder shall be made, in accordance with Section 2.16
hereof, free and clear of and without deduction for any and all present or
future taxes, levies, imposts, deductions, charges or withholdings in any such
case imposed by the United States or any political subdivision thereof,
excluding:
(i) in the case of the Agent and each Lender, taxes imposed or
based on its net income, and franchise or capital taxes imposed on it,
(A) if the Agent or such Lender is organized under the laws of the
United States or any political subdivision thereof and (B) if the
Agent or such
Lender is not organized under the laws of the United States or any
political subdivision thereof, and its principal office or
Applicable Lending Office is located in the United States, and in
the case of both (A) and (B), withholding taxes payable with respect
to payments to the Agent or such Lender at its principal office or
Applicable Lending Office under laws (including, without limitation,
any treaty, ruling, determination or regulation) in effect on the
date hereof, but not any increase in withholding tax resulting from
any subsequent change in such laws (other than withholding with
respect to taxes imposed or based on its net income or with respect
to franchise or capital taxes), and
(ii) taxes (including withholding taxes) imposed by reason of the
failure of the Agent or any Lender, in either case that is organized
outside the United States, to comply with Section 2.15(f) hereof (or
the inaccuracy at any time of the certificates, documents and other
evidence delivered thereunder)
(all such nonexcluded taxes, levies, imposts, deductions, charges, withholdings
and liabilities being hereinafter referred to as "Taxes"). If any Borrower or
any Guarantor shall be required by law to deduct any Taxes from or in respect of
any sum payable hereunder to the Lenders or the Agent, (x) the sum payable shall
be increased by the amount necessary so that after making all required
deductions (including without limitation deductions applicable to additional
sums payable under this Section 2.15) such Lender or the Agent (as the case may
be) receives an amount equal to the sum it would have received had no such
deductions been made, (y) such Borrower and/or such Guarantor shall make such
deductions and (z) such Borrower and/or such Guarantor shall pay the full amount
deducted to the relevant tax authority or other authority in accordance with
applicable law.
(b) In addition, each Borrower and each Guarantor agrees to pay any
present or future stamp or documentary taxes or any other excise or property
taxes, charges or similar levies which arise from any payment made hereunder or
from the execution, delivery or registration of, or otherwise with respect to,
this Agreement (hereinafter referred to as "Other Taxes").
(c) The Borrowers will indemnify each Lender and the Agent for the
full amount of Taxes or Other Taxes (including, without limitation, any Taxes or
Other Taxes imposed by any jurisdiction (except as specified in clauses (a)(i)
and (ii)) on amounts payable under this Section 2.15) paid by such Lender or the
Agent (as the case may be) and any liability (including penalties, interest and
expenses) arising therefrom or with respect thereto. This indemnification shall
be made within 30 days from the date such Lender or the Agent (as the case may
be) makes written demand therefor. If any Lender receives a refund in respect
of any Taxes or Other Taxes for which such Lender has received payment from the
Borrowers hereunder, such Lender
shall promptly notify the Borrowers of such refund and such Lender shall,
within 30 days of receipt of a request by the Borrowers, repay such refund to
the Borrowers (or if there shall at such time be continuing a Default or
Event of Default, pay the same to the Agent to be applied to the Obligations
in such order and manner as the Agent shall choose in its discretion);
provided, that the Borrowers, upon the request of such Lender, agree to
return such refund (whether returned to the Borrowers or applied to the
Obligations) (plus any penalties, interest or other charges) to such Lender
in the event such Lender is required to repay such refund.
(d) Within 30 days after the date of any payment of Taxes or Other
Taxes withheld by any Borrower or any Guarantor in respect of any payment to any
Lender, the Borrowers will furnish to the Agent, at its address referred to in
Section 11.01 hereof, such certificates, receipts and other documents as may be
reasonably required to evidence payment thereof.
(e) Without prejudice to the survival of any other agreement
hereunder, the agreements and obligations contained in this Section 2.15 shall
survive the payment in full of principal and interest hereunder.
(f) Each Lender that is organized outside of the United States shall
deliver to the Borrowers on the date hereof (or, in the case of an assignee, on
the date of the assignment) and from time to time as required for renewal under
applicable law duly completed copies of United States Internal Revenue Service
Form 1001 or 4224 (or any successor or additional forms), as appropriate,
indicating in each case that such Lender is entitled to receive payments under
this Agreement without any deduction or withholding of any United States federal
income taxes. The Agent (if the Agent is an entity organized outside the United
States) and each Lender that is organized outside the United States shall
promptly notify the Borrowers and the Agent of any change in its Applicable
Lending Office and such Lender shall, prior to the immediately following due
date of any payment by the Borrowers hereunder, deliver to the Borrowers (with
copies to the Agent), such certificates, documents or other evidence, as
required by the Code or Treasury Regulations issued pursuant thereto, including
without limitation Internal Revenue Service Form 4224, Form 1001 and any other
certificate or statement of exemption required by Treasury Regulation
Section 1.1441-4(a) or Section 1.1441-6(c) or any subsequent version thereof,
properly completed and duly executed by such Lender establishing that such
payment is (i) not subject to withholding under the Code because such payment is
effectively connected with the conduct by such Lender of a trade or business in
the United States or (ii) totally exempt from United States tax under a
provision of an applicable tax treaty. The Borrowers shall be entitled to rely
on such forms in their possession until receipt of any revised or successor form
pursuant to this Section 2.15(f). If the Agent or a Lender fails to provide a
certificate, document or other evidence required pursuant to this
Section 2.15(f), then (i) the Borrowers shall be entitled to deduct or withhold
on payments to the Agent or such Lender as a result of such failure, as required
by law, and (ii) the Borrowers shall not be required to make
payments of additional amounts with respect to such withheld Taxes pursuant
to clause (x) of Section 2.15(a) to the extent such withholding is required
by reason of the failure of the Agent or such Lender to provide the necessary
certificate, document or other evidence.
SECTION II.16. Payments and Computations. The Borrowers shall make
each payment hereunder and under any instrument delivered hereunder not later
than 12:00 noon (New York City time) on the day when due in lawful money of the
United States (in freely transferable dollars) to the Agent, at its offices at
00 Xxxx 00xx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Account No. 2-550-00-5458, for
the account of the Lenders, in immediately available funds. The Agent may
charge, when due and payable, Jitney Jungle's account with the Agent (Account
No. 2-550-00-5458) for all interest, principal and Commitment Fees or other fees
owing to the Agent, the Lenders or the Letter of Credit Issuer on or with
respect to this Agreement and/or the Loans and Letters of Credit and other Loan
Documents.
SECTION II.17. Settlement Among Lenders. (a) The Agent shall pay to
each Lender not later than one (1) Business Day after each Interest Payment
Date, its ratable portion, based on the principal amount of the Loans owing to
such Lender, of all interest payments and any other fees received by the Agent
hereunder in respect of the Loans, net of any amounts payable by such Lender to
the Agent, by wire transfer.
(b) It is agreed that each Lender's Loans are intended by the Lenders
to be equal at all times to such Lender's ratable portion (as determined in
accordance with the percentage amounts set forth in Schedule 2.01 hereto) of the
aggregate principal amount of all Loans outstanding. Notwithstanding such
agreement, the Lenders agree that in order to facilitate the administration of
this Agreement and the other Loan Documents, settlement among them shall,
subject to the provisions of clause (d) below, take place on a periodic basis in
accordance with the provisions of clause (c) below.
(c) (i) To the extent and in the manner hereinafter provided in this
Section 2.17, settlement among the Lenders as to Loans shall occur periodically
on Settlement Dates determined from time to time by the Agent, which may occur
before or after the occurrence or during the continuance of a Default or Event
of Default and whether or not all of the conditions to the making of Loans set
forth in Section 5.01 have been met. On each Settlement Date, payments shall be
made to the Agent for the account of the Lenders in the manner provided in this
Section 2.17 in accordance with the Settlement Report delivered by the Agent
pursuant to the provisions of this Section 2.17 in respect of such Settlement
Date so that as of each Settlement Date, and after giving effect to the
transactions on such Settlement Date, each Lender's Loans shall equal such
Lender's ratable portion of the Loans outstanding as determined in accordance
with the percentage amounts set forth in Schedule 2.01 hereto.
(ii) The Agent shall designate periodic Settlement Dates which may
occur on any Business Day after the Initial Closing Date; provided, however,
that Settlement Dates shall occur on the closest Business Day to the 10th and
25th day of each calendar month or more frequently as determined by the Agent in
its discretion (including, without limitation, under clause (d)(i) hereof). The
Agent shall designate a Settlement Date by delivering to each Lender a
Settlement Report not later than 10:00 a.m. (New York City time) on the proposed
Settlement Date, which Settlement Report shall be with respect to the period
beginning on the next preceding Settlement Date and ending on such designated
Settlement Date.
(iii) Between Settlement Dates, the Agent shall request and Fleet
as a Lender shall, subject to the provisions of clause (d) below, advance to the
Borrowers out of Fleet's own funds, the entire principal amount of any Loan
requested or deemed requested pursuant to Section 2.03 (any such Loan being
referred to as a "Non-Ratable Loan"). The making of each Non-Ratable Loan by
Fleet shall be deemed to be a purchase by Fleet of a 100% participation in each
other Lender's ratable portion of the amount of such Non-Ratable Loan. All
payments of principal, interest and any other amount with respect to such
Non-Ratable Loan shall be payable to and received by the Agent for the account
of Fleet. Any payments received by the Agent between Settlement Dates which in
accordance with the terms of this Agreement are to be applied to the reduction
of the outstanding principal balance of Loans, shall be paid over to and
retained by Fleet for such application, and such payment to and retention by
Fleet shall be deemed, to the extent of each other Lender's ratable portion of
such payment, to be a purchase by each such other Lender of a participation in
the Loans (including the repurchase of participations in Non-Ratable Loans) held
by Fleet immediately prior to the receipt and application of such payment.
(iv) If on any Settlement Date the decrease, if any, in the dollar
amount of any Lender's Loans which is required to comply with the first sentence
of Section 2.17(b) is more than such Lender's ratable portion of amounts
received by the Agent and paid only to Fleet since the next preceding Settlement
Date, such Lender and the Agent, in their respective records, shall apply such
Lender's ratable portion of such amounts to the decrease in such Lender's Loans,
and Fleet shall pay to the Agent, for the account of such Lender, the excess.
(v) If on any Settlement Date the increase, if any, in the dollar
amount of any Lender's Loans which is required to comply with the first sentence
of Section 2.17(b) exceeds such Lender's ratable portion of amounts received by
the Agent and paid only to Fleet since the next preceding Settlement Date, such
Lender and the Agent, in their respective records, shall apply such Lender's
ratable portion of such amounts to the increase in such Lender's Loans, and such
Lender shall pay to the Agent, for the account of Fleet, the excess.
(vi) If a Settlement Report indicates that no Loans have been made
during the period since the next preceding Settlement Date, then such Lender's
ratable portion of any amounts received by the Agent but paid only to Fleet
shall be paid by Fleet to the Agent, for the account of such Lender. If a
Settlement Report indicates that the increase in the dollar amount of a Lender's
Loans which is required to comply with the first sentence of Section 2.17(b) is
exactly equal to such Lender's ratable portion of amounts received by the Agent
but paid only to Fleet since the next preceding Settlement Date, such Lender and
the Agent, in their respective records, shall apply such Lender's ratable
portion of such amounts to the increase in such Lender's Loans.
(vii) If any amounts received by Fleet in respect of the
Obligations are later required to be returned or repaid by Fleet to the
Borrowers or any other obligor or their respective representatives or successors
in interest, whether by court order, settlement or otherwise, and such amounts
repaid or returned by Fleet are in excess of Fleet's ratable portion of all such
amounts required to be returned by all Lenders, each other Lender shall, upon
demand by Fleet with notice to the Agent, pay to the Agent for the account of
Fleet, an amount equal to the excess of such Lender's ratable portion of all
such amounts required to be returned by all Lenders over the amount, if any,
returned directly by such Lender.
(viii) (x) Payment by any Lender to the Agent shall be made not
later than 1:00 p.m. (New York City time) on the Business Day such payment is
due, provided that if such payment is due on written demand by another
Lender, including pursuant to clause (d) below, such written demand shall be
made on the paying Lender not later than 10:00 a.m. (New York City time) on
such Business Day. Payment by the Agent to any Lender shall be made by wire
transfer, promptly following the Agent's receipt of funds for the account of
such Lender and in the type of funds received by the Agent, provided that if
the Agent receives such funds at or prior to 1:00 p.m. (New York City time),
the Agent shall pay such funds to such Lender by 3:00 p.m. (New York City
time) on such Business Day. If a demand for payment is made after the
applicable time set forth above, the payment due shall be made by 3:00 p.m.
(New York City time) on the first Business Day following the date of such
demand.
(y) If a Lender shall, at any time, fail to make any payment
to the Agent required hereunder, the Agent may, but shall not be required to,
retain payments that would otherwise be made to such Lender hereunder and
apply such payments to such Lender's defaulted obligations hereunder, at such
time, and in such order, as the Agent may elect in its sole discretion.
(z) With respect to the payment of any funds under this Section
2.17(c), whether from the Agent to a Lender or from a Lender to the
Agent, the party failing to make full payment when due pursuant to the terms
hereof shall, upon written demand by the other party, pay such amount together
with interest on such amount at the Federal Funds Effective Rate.
(d) (i) The Agent shall have the right at any time to require, by
notice to each Lender, that all settlements in respect of advances and
repayments of Loans be made on a daily basis. From and after the giving of such
notice (and until such time, if any, as the Agent notifies the Lenders of its
determination to return to a periodic settlement basis), each Lender shall pay
to the Agent such Lender's ratable portion of the amount of each Loan on the
date such Loan is made in accordance with the provisions of clause (c)(viii)
above and the Agent shall pay to each Lender by wire transfer by 5:00 p.m. (New
York City time) funds received before 1:00 p.m. (New York City time) on such
Business Day by the Agent from the Borrowers and by 3:00 p.m. (New York City
time) funds received after 1:00 p.m. (New York City time) of the preceding
Business Day by the Agent from the Borrowers, by wire transfer, such Lender's
ratable portion of the net amount of all payments received by the Agent
hereunder in respect of the principal of the Loans (after deducting the
principal amount of Loans made on such day) or in respect of interest on the
Loans. Any amount payable pursuant to this subsection which is not paid when
due shall bear interest, payable by the Agent, for each day until paid in full
at the Federal Funds Effective Rate in effect on such day.
(ii) In addition to, and without limiting the right of the Agent
to require daily settlement pursuant to clause (i), upon written demand by Fleet
with notice thereof to the Agent, each other Lender shall pay to the Agent, for
the account of Fleet, as the repurchase of Fleet's participation interest in
such Lender's Loans, an amount equal to 100% of such Lender's ratable portion of
the unpaid principal amount of all Non-Ratable Loans. Payments made pursuant to
this clause (ii) shall be made not later than 5:00 p.m. (New York City time) on
any Business Day if demand for such payment is received by such Lender not later
than 10:00 a.m. (New York City time) on such Business Day; otherwise, any such
payment shall be made on the next Business Day after demand is received
therefor.
SECTION II.18. Making of Loans. (a) Unless the Agent has been
notified in writing to the contrary before 2:00 p.m. New York time on the date
of any borrowing, the Agent may assume that each Lender will make its ratable
portion of any amount to be borrowed available to the Agent in accordance with
Section 2.02(b) hereof, and the Agent may in its discretion, in reliance upon
such assumption, make available to the Borrowers on such date a corresponding
amount. If and to the extent such Lender shall not make such ratable portion
available to the Agent, such Lender and the Borrowers severally agree to repay
to the Agent forthwith on demand such corresponding amount, together with
interest thereon for each day from the date such amount is made available to the
Borrowers until the date such amount is repaid to the Agent, as to the
Borrowers, at the rate of interest applicable to Loans hereunder, and
as to such other Lender, at the Federal Funds Effective Rate and until so
repaid such amount shall be deemed to constitute a Loan by the Agent to the
Borrowers hereunder entitled to the benefits of the Collateral and the other
provisions hereof applicable to the Loans. If such Lender shall repay to the
Agent such corresponding amount, the amount so repaid shall constitute such
Lender's ratable portion of the Loans made on such borrowing date for
purposes of this Agreement. No Lender shall be responsible for the failure
of any other Lender to make its ratable portion of such Loans available on
the borrowing date.
(b) Without limiting the generality of Article IX, each Lender
expressly authorizes the Agent to determine on behalf of such Lender (i) whether
to make Loans requested or deemed requested by the Borrowers on any borrowing
date (unless the Agent has been notified in writing to the contrary before 2:00
p.m. New York time on such borrowing date), (ii) the creation of any reserves
against the Borrowing Base, (iii) any reduction of advance rates applicable to
the Borrowing Base and (iv) whether specific items of inventory constitute
"Eligible Inventory" in accordance with the definition of such term set forth in
Article I. The Agent shall give prompt notice to the Lenders of any
determinations made pursuant to clause (ii) or (iii) above.
SECTION II.19. Joint and Several Borrowers. The parties hereto agree
and confirm that the obligations of the Borrowers under and/or in connection
with this Agreement and the other Loan Documents (including, without limitation,
with respect to payments of principal, interest, fees and all other amounts with
respect to the Loans) are the joint and several undertaking of each Borrower.
SECTION II.20. Individual Borrowing and Letter of Credit Limit.
Notwithstanding any provision in this Agreement to the contrary, none of the
Borrowers shall be entitled to request Loans, receive Loan advances or request
the issuance of Letters of Credit unless the Maximum Facility Amount of the
applicable Borrower shall be greater than the amount of Loans requested by such
Borrower and not repaid and all Letter of Credit Usage with respect to Letters
of Credit previously issued for the account of such Borrower. In furtherance of
this Section 2.20, (i) all borrowing base and other collateral reporting
material described in Section 6.05(g) and/or Section 6.05(h) of this Agreement
shall be presented on a Borrower by Borrower basis in a manner consistent with
this Section 2.20 and (ii) on the date of delivery of the borrowing base and
other collateral reporting material described in Section 6.05(g) and/or Section
6.05(h) (or at such later date as the Agent shall request), each Borrower shall
repay Loans to the extent that the principal amount of Loans and Letters of
Credit requested by such Borrower shall exceed the Maximum Facility Amount of
such Borrower. Nothing contained in this Section 2.20 shall permit Loans to be
made or Letters of Credit to be issued unless the Borrowers are in compliance
with the other provisions of this Agreement (including, without limitation,
Section 2.01(a)).
IIA. LETTERS OF CREDIT
SECTION 2A.01. Issuance of Letters of Credit. Upon the request of
Jitney Jungle, and subject to the conditions set forth in Article V hereof and
such other conditions to the opening of Letters of Credit as the Letter of
Credit Issuer requires of its customers generally, the Agent shall cause the
Letter of Credit Issuer from time to time to open trade or standby letters of
credit (each, a "Letter of Credit") for the account of the Borrowers; provided
that the Letter of Credit Usage shall not at any time exceed $30,000,000; and
provided, further, that the face amount of any Letter of Credit that Jitney
Jungle may request to be opened at any time shall not exceed an amount equal to
(A) the lesser of (i) the Total Commitment at such time and (ii) the Borrowing
Base at such time minus (B) the sum of (i) the unpaid principal amount of all
Loans outstanding at such time, (ii) the Letter of Credit Usage at such time and
(iii) the reserves then in effect under Section 2.01(c) hereof. The issuance of
each Letter of Credit shall be made on at least four Business Days' prior
written notice from Jitney Jungle to the Agent, at its Domestic Lending Office,
which written notice shall be an application for a Letter of Credit on the
Letter of Credit Issuer's customary form and shall indicate the Borrower for
whose account the Letter of Credit is to be issued. The expiration date of any
trade Letter of Credit shall not be later than 180 days from the date of
issuance thereof and the expiration date of any standby Letter of Credit shall
not be later than 365 days from the date of issuance thereof and, in any event,
no Letter of Credit shall have an expiration date later than the Termination
Date. The Letters of Credit shall be issued with respect of transactions
occurring in the ordinary course of business of the Borrowers.
SECTION 2A.02. Payment; Reimbursement. Upon the issuance of any
Letter of Credit, the Agent shall notify each Lender of the principal amount,
the number, and the expiration date thereof and the amount of such Lender's
participation therein. By the issuance of a Letter of Credit hereunder and
without further action on the part of the Agent, the Letter of Credit Issuer or
the Lenders, each Lender hereby accepts from the Letter of Credit Issuer a
participation (which participation shall be nonrecourse to the Letter of Credit
Issuer) in such Letter of Credit equal to such Lender's pro rata (based on its
Commitment) share of such Letter of Credit, effective upon the issuance of such
Letter of Credit. Each Lender hereby absolutely and unconditionally assumes, as
primary obligor and not as a surety, and agrees to pay and discharge, and to
indemnify and hold the Letter of Credit Issuer harmless from liability in
respect of, such Lender's pro rata share of the amount of any drawing under a
Letter of Credit. Each Lender acknowledges and agrees that its obligation to
acquire participations in each Letter of Credit issued by the Letter of Credit
Issuer and its obligation to make the payments specified herein, and the right
of the Letter of Credit Issuer to receive the same, in the manner specified
herein, are absolute and unconditional and shall not be affected by any
circumstance whatsoever, including, without limitation, the occurrence and
continuance of a Default or an Event of Default hereunder, and that each such
payment shall be made without any offset, abatement, withholding or reduction
whatsoever. The Agent and/or the Letter of Credit Issuer shall review, on
behalf of the
Lenders, each draft and any accompanying documents presented under a Letter
of Credit and shall notify each Lender of any such presentment. Promptly
after the Agent and/or the Letter of Credit Issuer shall have ascertained
that any draft and any accompanying documents presented under such Letter of
Credit appear on their face to be in substantial conformity with the terms
and conditions of the Letter of Credit, the Agent shall give telephonic or
facsimile notice to the Lenders and the Borrowers of the receipt and amount
of such draft and the date on which payment thereon will be made, and the
Lenders shall, by 11:00 a.m., New York City time on the date such payment is
to be made, pay the amounts required to the Agent on behalf of the Letter of
Credit Issuer in New York, New York in immediately available funds, and the
Letter of Credit Issuer, not later than 3:00 p.m. on such day, shall make the
appropriate payment to the beneficiary of such Letter of Credit. If the
Letter of Credit Issuer shall pay any draft presented under a Letter of
Credit, then the Agent and/or the Letter of Credit Issuer, on behalf of the
Lenders, shall charge the general deposit account of the Borrowers with the
Agent and/or the Letter of Credit Issuer, as the case may be, for the amount
thereof, together with the Agent's or the Letter of Credit Issuer's customary
overdraft fee in the event the funds available in such account shall not be
sufficient to reimburse the Lenders for such payment and the Borrowers shall
not otherwise have discharged such reimbursement obligation by 12:00 noon,
New York City time, on the date of such payment. If the Lenders have not
been reimbursed with respect to such drawing as provided above, the Borrowers
shall pay to the Agent, for the account of the Lenders, the amount of the
drawing together with interest on such amount at a rate per annum (computed
on the basis of the actual number of days elapsed over a year of 365 days)
equal to the Prime Rate plus 4%, payable on demand. The obligation of the
Borrowers under this Section 2A.02 to reimburse the Lenders and the Letter of
Credit Issuer for all drawings under Letters of Credit shall be absolute,
unconditional and irrevocable and shall be satisfied strictly in accordance
with their terms, irrespective of:
(a) any lack of validity or enforceability of any Letter of Credit;
(b) the existence of any claim, setoff, defense or other right which
any Borrower or any other person may at any time have against the
beneficiary under any Letter of Credit, the Agent, the Letter of Credit
Issuer or any Lender (other than the defense of payment in accordance with
the terms of this Agreement or a defense based on the gross negligence, bad
faith or willful misconduct of the Agent, the Letter of Credit Issuer or
any Lender) or any other person in connection with this Agreement or any
other transaction;
(c) any draft or other document presented under any Letter of Credit
proving to be forged, fraudulent, invalid or insufficient in any respect or
any statement therein being untrue or inaccurate in any respect;
(d) payment by the Agent, the Letter of Credit Issuer or any Lender
under any Letter of Credit against presentation of a draft or other
document which does not comply with the terms of such Letter of Credit; and
(e) any other circumstance or event whatsoever, whether or not
similar to any of the foregoing.
It is understood that in making any payment under any Letter of Credit
(x) the Agent's, the Letter of Credit Issuer's and any Lender's exclusive
reliance on the documents presented to it under
such Letter of Credit as to any and all matters set forth therein, including,
without limitation, reliance on the amount of any draft presented under such
Letter of Credit, whether or not the amount due to the beneficiary equals the
amount of such draft and whether or not any document presented pursuant to
such Letter of Credit proves to be insufficient in any respect, if such
document on its face appears to be in order, and whether or not any other
statement or any other document presented pursuant to such Letter of Credit
proves to be forged or invalid or any statement therein proves to be
inaccurate or untrue in any respect whatsoever and (y) any noncompliance in
any immaterial respect of the documents presented under such Letter of Credit
with the terms thereof shall, in each case, not be deemed willful misconduct
or bad faith of the Agent, the Letter of Credit Issuer or any Lender.
SECTION 2A.03. The Letter of Credit Issuer's Actions. Any Letter of
Credit may, in the discretion of the Letter of Credit Issuer or its
correspondents, be interpreted by them (to the extent not inconsistent with such
Letter of Credit) in accordance with the Uniform Customs and Practice for
Documentary Credits of the International Chamber of Commerce, as adopted or
amended from time to time, or any other rules, regulations and customs
prevailing at the place where any Letter of Credit is available or the drafts
are drawn or negotiated. The Letter of Credit Issuer and its correspondents may
accept and act upon the name, signature, or act of any party purporting to be
the executor, administrator, receiver, trustee in bankruptcy, or other legal
representative of any party designated in any Letter of Credit in the place of
the name, signature, or act of such party.
SECTION 2A.04. Payments in Respect of Increased Costs. (a)
Notwithstanding any other provision herein, if after the date of this Agreement
any change in applicable law or regulation or in the interpretation or
administration thereof by any governmental authority charged with the
interpretation or administration thereof (whether or not having the force of
law) or any change in generally accepted accounting principles or regulatory
accounting principles applicable to the Agent, the Letter of Credit Issuer or
any Lender shall (i) impose, modify or make applicable to the Agent, the Letter
of Credit Issuer or any Lender any reserve, special deposit or similar
requirement with respect to its obligations under this Article IIA or any Letter
of Credit, (ii) impose on the Agent, the Letter of Credit Issuer or any Lender
any other condition with respect to its obligations under this Article IIA or
any Letter of Credit, or (iii) subject the Agent, the Letter of Credit Issuer or
any Lender to any tax (other than (x) taxes imposed on the overall net income of
the Agent, the Letter of Credit Issuer or such Lender and (y) franchise taxes
imposed on the Agent, the Letter of Credit Issuer or such Lender, in either case
by the jurisdiction in which the Agent, the Letter of Credit Issuer or such
Lender, as appropriate, has its principal office or lending office or any
political subdivision or taxing authority of any such jurisdiction), charge,
fee, deduction or withholding of any kind whatsoever, and the result of any of
the foregoing shall be to increase the cost to the Agent, the Letter of Credit
Issuer or such Lender of maintaining such Letter of Credit or making any payment
under such Letter of Credit or this Article IIA or to reduce the amount of
principal, interest or any fee or compensation receivable by the Agent, the
Letter of Credit Issuer or such Lender in respect of this Article IIA or such
Letter of Credit, then such additional amount or amounts as will compensate the
Agent, the Letter of Credit Issuer or such Lender for such additional costs or
reduction shall be paid to the Agent for its benefit or the benefit of the
Letter of Credit Issuer or such Lender by the Borrowers. Each Lender agrees to
give notice to the Borrowers and the Agent of any such change in law,
regulation, interpretation or administration with reasonable promptness after
becoming actually aware thereof and
of the applicability thereof to the transactions contemplated in this Article
IIA.
(b) If, after the date of this Agreement, any Lender or the Letter of
Credit Issuer shall have determined that the adoption of any applicable law,
rule, regulation or guideline regarding capital adequacy, or any change therein,
or any change in the interpretation or administration thereof by any
governmental authority, central bank or comparable agency charged with the
interpretation or administration thereof, or compliance by any Lender or the
Letter of Credit Issuer (or its lending office) with any request or directive
regarding capital adequacy (whether or not having the force of law) of any such
authority, central bank or comparable agency, has or would have the effect of
reducing the rate of return on such Lender's or the Letter of Credit Issuer's
capital as a consequence of its obligations under this Article IIA or with
respect to a Letter of Credit to a level below that which such Lender or the
Letter of Credit Issuer could have achieved but for such adoption, change or
compliance (taking into consideration such Lender's and the Letter of Credit
Issuer's policies with respect to capital adequacy) then from time to time, the
Borrowers shall pay to such Lender or the Agent on behalf of the Letter of
Credit Issuer such additional amount or amounts as will compensate the Letter of
Credit Issuer or such Lender for such reduction. Each Lender agrees to give
notice to the Borrowers and the Agent of any adoption of, change in, or change
in interpretation or administration of, any such law, rule, regulation or
guideline with reasonable promptness after becoming actually aware thereof and
of the applicability thereof to the transactions contemplated hereby.
(c) A certificate of the Agent, the Letter of Credit Issuer or a
Lender setting forth such amount or amounts, supported by calculations in
reasonable detail, as shall be necessary to compensate the Agent, the Letter of
Credit Issuer or such Lender, as appropriate, as specified in paragraphs (a) and
(b) above shall be delivered to the Borrowers and shall be conclusive and
binding upon the Borrowers absent manifest error. The Borrowers shall pay the
Agent on behalf of the Letter of Credit Issuer or such Lender the amount shown
as due on any such certificate within five (5) Business Days after its receipt
of the same.
(d) Failure on the part of any Lender, the Letter of Credit Issuer or
the Agent to demand compensation for any increased costs, reduction in amounts
received or receivable with respect to this Article IIA or any Letter of Credit
or reduction in the rate of return earned on such Lender's or the Letter of
Credit Issuer's capital, in each case pursuant to paragraph (a) or (b) above,
shall not constitute a waiver of the Agent's, the Letter of Credit Issuer's or
such Lender's rights to demand compensation for any increased costs or reduction
in amounts received or receivable or reduction in rate of return pursuant to
paragraph (a) or (b) above. The protection under this Section 2A.04 shall be
available to each Lender, the Letter of Credit Issuer and the Agent regardless
of any possible contention of the invalidity or inapplicability of any law,
regulation or other condition which shall give rise to any demand by such
Lender, the Letter of Credit Issuer or the Agent for compensation (but if such
law, regulation or
other condition is finally determined to be invalid or inapplicable, the
Agent on its behalf and on behalf of the Letter of Credit Issuer or Lenders
shall promptly refund (without interest) all amounts paid under this Section
2A.04 arising from such invalid or inapplicable law, regulation or other
condition).
(e) Notwithstanding any other provision of this Section 2A.04, no
Lender shall demand any payment referred to above if it shall not at the time be
the general policy or practice of such Lender to demand such compensation in
substantially similar circumstances under substantially comparable provisions of
other credit agreements.
SECTION 2A.05. Indemnity as to Letters of Credit. Each Borrower and
each Guarantor hereby agrees to indemnify and hold harmless the Agent, the
Letter of Credit Issuer and the Lenders from and against any and all claims,
damages, losses, liabilities, costs or expenses whatsoever which the Agent, the
Letter of Credit Issuer or the Lenders may incur or suffer by reason of or in
connection with the execution and delivery or assignment of, or payment under,
any Letter of Credit, except only if and to the extent that any such claim,
damage, loss, liability, cost or expense shall be caused by the gross
negligence, willful misconduct or bad faith of the Agent, the Letter of Credit
Issuer or any Lender performing its obligations under this Agreement. Without
limiting the foregoing, each Borrower and each Guarantor further agrees to
indemnify and hold harmless the Agent, the Letter of Credit Issuer, their
respective officers and directors, each person who controls the Agent or the
Letter of Credit Issuer within the meaning of Section 15 of the Securities Act
of 1933 or any applicable state securities law and their respective successors
from and against any and all claims, damages, losses, liabilities, costs or
expenses, joint or several, to which they or any of them may become subject
under any Federal or state securities law, rule or regulation, at common law or
otherwise, insofar as such claims, damages, losses, liabilities, costs or
expenses arise out of or are based upon the execution and delivery by the Letter
of Credit Issuer of any Letters of Credit or the execution and delivery of any
other document in connection therewith (but not including any claims, damages,
losses, liabilities, costs or expenses arising from the gross negligence, bad
faith or willful misconduct of the Letter of Credit Issuer). The Borrowers,
upon demand by the Agent or the Letter of Credit Issuer at any time, shall
reimburse the Agent and the Letter of Credit Issuer for any reasonable legal or
other expenses incurred in connection with investigating or defending against
any of the foregoing. The indemnities contained herein shall survive the
expiration or termination of the Letters of Credit and this Agreement.
SECTION 2A.06. Letter of Credit Fees. The Borrowers agree to pay to
the Agent (a) for the ratable benefit of the Lenders, with respect to any Letter
of Credit, on the last business day of each March, June, September and December
and on the date of the full drawing, cancellation, termination or expiration of
such Letter of Credit, a letter of credit fee for such calendar quarter or
shorter period equal to the then Applicable Margin on Eurodollar Loans on the
average daily undrawn amount thereof
for such calendar quarter or shorter period, payable to the Agent at its
Domestic Lending Office in immediately available funds and (b) for the sole
benefit of the Letter of Credit Issuer, with respect to any Letter of Credit,
on the same dates as the Letter of Credit fee with respect to such Letter of
Credit is payable under clause (a) above, a fronting fee for such calendar
quarter or shorter period equal to one-quarter of one percent (1/4%) per
annum on the average daily undrawn amount thereof for such calendar quarter
or shorter period, payable to the Agent on behalf of the Letter of Credit
Issuer at the Agent's Domestic Lending Office in immediately available funds.
The foregoing fees shall be computed on the basis of the actual number of
days elapsed over a year of 365 days. Additionally, the Borrowers shall pay
to the Agent at its Domestic Lending Office for the sole account of the
Letter of Credit Issuer upon demand by the Agent or the Letter of Credit
Issuer all of the Letter of Credit Issuer's customary fees and expenses with
respect to the opening, drawing upon, extending, amending, transferring,
canceling or administration of Letters of Credit from time to time in effect.
The Agent shall disburse to each Lender such Lender's pro rata share of any
payment of the letter of credit fees referred to in clause (a) of the first
sentence of this Section 2A.06 in immediately available funds within one (1)
Business Day of the Agent's receipt of such payment.
III. COLLATERAL SECURITY
SECTION III.1. Security Documents. The Obligations shall be secured
by the Collateral described in the Security Documents and are entitled to the
benefits thereof. The Borrowers shall, and shall cause the other Grantors to,
duly execute and deliver the Security Documents, all consents of third parties
necessary to permit the effective granting of the Liens created in such
agreements, financing statements pursuant to the Uniform Commercial Code and
other documents, all in form and substance satisfactory to the Agent, as may be
reasonably required by the Agent to grant to the Agent for the benefit of the
Secured Parties a valid, perfected and enforceable first priority Lien on and
security interest in (subject only to the Liens permitted under Section 7.01
hereof) the Collateral.
SECTION III.2. Filing and Recording. The Borrowers shall, at their
sole cost and expense, cause all instruments and documents given as evidence of
security pursuant to this Agreement to be duly recorded and/or filed or
otherwise perfected in all places necessary, in the opinion of the Agent, and
take such other actions as the Agent may reasonably request, in order to perfect
and protect the Liens of the Agent and the Secured Parties in the Collateral.
Each Borrower and each Guarantor, to the extent permitted by law, hereby
authorizes the Agent to file any financing statement in respect of any Lien
created pursuant to the Security Documents which may at any time be required or
which, in the opinion of the Agent, may at any time be desirable although the
same may have been executed only by the Agent or, at the option of the Agent, to
sign such financing statement on behalf of such Borrower or such Guarantor, as
the
case may be, and file the same, and each Borrower and each Guarantor hereby
irrevocably designates the Agent, its agents, representatives and designees as
its agent and attorney-in-fact for this purpose. In the event that any
re-recording or refiling thereof (or the filing of any statements of
continuation or assignment of any financing statement) is required to protect
and preserve such Lien, each Borrower shall, at the Borrowers' cost and expense,
cause the same to be recorded and/or refiled at the time and in the manner
requested by the Agent.
SECTION III.3. Real Property; Mortgages; Title Insurance. (a) To
the extent requested prior to the Initial Closing Date by the Agent:
(i) each Borrower and each Guarantor shall duly execute and
deliver to the Agent mortgages or deeds of trust (each such mortgage or
deed of trust, as it may be amended, modified or supplemented from time to
time in accordance with its terms, a "Mortgage") in respect of real
property owned or leased by such Borrower or such Guarantor, together with
consents of third parties to the Mortgages executed and delivered by it,
and such title searches, non-disturbance agreements, lease amendments
and/or consents, landlord's waivers, estoppel certificates and waivers, as
the Agent shall request (in each case in form and substance satisfactory to
the Agent) so as to create in the Agent's favor, for the benefit of the
Secured Parties, upon recordation thereof, a valid, perfected and
enforceable first priority Lien (subject to Liens permitted under
Section 7.01 hereof) on the real property and improvements described
therein, such Mortgages to be in form and substance satisfactory to the
Agent; and
(ii) each Borrower and each Guarantor shall cause the Mortgages
executed and delivered to be duly recorded in the appropriate recording
office or offices and shall pay all fees and taxes payable in connection
therewith.
(b) Each Borrower and each Guarantor shall furnish to the Agent for
the benefit of the Secured Parties, at the Borrowers' cost and expense, one or
more policies of mortgagee title insurance, in form, substance and amount
reasonably satisfactory to the Agent, insuring that each of the Mortgages
executed and delivered by it pursuant hereto is a valid and perfected first
priority Lien (except for the Liens permitted by Section 7.01) in favor of the
Agent, for the benefit of the Secured Parties, on the fee or leasehold interest
of such Borrower or such Guarantor, in the real property and improvements
described therein, and that such Borrower or such Guarantor has good and
marketable title thereto, issued by a title insurance company reasonably
satisfactory to the Agent, together with satisfactory evidence that all title
insurance premiums have been fully paid. The Borrowers shall furnish to the
Agent certified surveys of real property and such other certificates and
documents as the Agent may reasonably request and which are customary in
financing of this type. Each Borrower and each Guarantor shall also provide to
each Lender with respect to any real
property to be subject to a Mortgage, on or prior to the taking of such
Mortgage, such appraisals of such real property as shall be reasonably
requested by the Agent. If requested by the Agent, each Borrower and each
Guarantor shall, at the Borrowers' cost and expense, furnish to the Agent,
for the benefit of the Secured Parties, flood insurance with respect to any
real property subject to any Mortgage to the extent such flood insurance can
be obtained by such Borrower and such Guarantor on commercially reasonable
terms; provided, however, that, at the Borrowers' cost and expense, each
Borrower and each Guarantor shall in any event maintain and shall furnish to
the Agent flood insurance with respect to any owned or leased real property
subject to any Mortgage to the extent flood insurance with respect to such
real property is required to be maintained by applicable law (whether such
law is applicable to any Lender (including, without limitation, by reason of
such Mortgage), any Borrower, any Guarantor or otherwise).
(c) Upon any Borrower or any Guarantor acquiring any real property
(whether owned or leased) after the Initial Closing Date (including, without
limitation, on the Merger Closing Date) in accordance with the provisions of
this Agreement, such Borrower or such Guarantor shall, to the extent
requested by the Agent, execute and deliver a Mortgage with respect to such
real property and such other documents as may be reasonably requested by the
Lenders with respect thereto and shall, to the extent requested by the Agent,
deliver or cause to be delivered to the Agent each of the documents described
in clause (b) above. This Section 3.03 shall not be deemed to allow any
Borrower or any Guarantor to acquire any property if otherwise prohibited by
this Agreement. Notwithstanding the foregoing, the Borrowers and Guarantors
shall only be obligated to exercise reasonable efforts to comply with the
requirements of this Section 3.03 with respect to the granting of mortgages
on leaseholds.
SECTION III.4. Post-Initial Closing Date Real Property; Further
Assurances. Not later than 60 days after the Initial Closing Date with respect
to any fee property (except with respect to the Alabama fee properties of
Delchamps which shall be not later than 10 days after the Initial Closing Date)
and 90 days after the Initial Closing Date with respect to any leasehold
property, the Agent shall have received (to the extent requested by the Agent,
whether before or after the Initial Closing Date):
(a) fully executed counterparts of Mortgages in respect of real
property owned or leased by such Borrower or such Guarantor (and identified
on Schedule 3.04 annexed hereto), together with consents of third parties
to the Mortgages executed and delivered by it, and such title searches,
non-disturbance agreements, lease amendments and/or consents, landlord's
waivers, estoppel certificates and waivers, as the Agent shall request (in
each case in form and substance satisfactory to the Agent) so as to create
in the Agent's favor, for the benefit of the Secured Parties, upon
recordation thereof, a valid, perfected and enforceable first priority Lien
(subject to Liens permitted under Section 7.01 hereof) on the real property
and improvements described therein, such Mortgages to be in form and
substance satisfactory to the Agent;
(b) each Borrower and each Guarantor shall cause the Mortgages
executed and delivered to be duly recorded in the appropriate recording
office or offices and shall pay all fees and taxes payable in connection
therewith;
(c) mortgagee title insurance (and, as applicable, endorsements
to existing title insurance policies), in form, substance and amount
reasonably satisfactory to the Agent, insuring that each of the Mortgages
executed and delivered by it pursuant hereto is a valid and perfected first
priority Lien (except for the Liens permitted by Section 7.01) in favor of
the Agent, for the benefit of the Secured Parties, on the fee or leasehold
interest of such Borrower or such Guarantor, in the real property and
improvements described therein, and that such Borrower or such Guarantor
has good and marketable title thereto, together with such other
endorsements reasonably requested by the Agent, issued by a title insurance
company reasonably satisfactory to the Agent, together with satisfactory
evidence that all title insurance premiums have been fully paid; and
(d) a survey, in form and substance satisfactory to the Agent,
to each Mortgaged Property, each certified by a licensed professional
surveyor satisfactory to the Agent and revealing no facts which would
materially interfere with the use of such properties by the Borrower and
its Subsidiaries, or an update of an existing survey provided the title
company will delete the exception for existing facts which a current survey
would disclose.
Notwithstanding the foregoing, the Borrowers and Guarantors shall only be
obligated to exercise reasonable efforts to comply with the requirements of this
Section with respect to the granting of Mortgages on leaseholds.
SECTION III.5. Additional Collateral. Each Borrower and each
Guarantor acknowledges that it is its intention to provide the Agent with a Lien
on all the property (excluding automobiles, but including, without limitation,
any property acquired in connection with the Related Transactions) of the
Borrowers, the Guarantors and their respective subsidiaries (personal, real and
mixed), whether now owned or hereafter acquired (other than as agreed to in
writing by the Agent), subject only to Liens permitted hereunder. Without
limitation of Section 3.03(c) hereof, each Borrower and each Guarantor shall
from time to time promptly notify the Agent of the acquisition by any of them or
any of their respective subsidiaries of any material property in which the Agent
does not then hold a perfected Lien (other than as agreed to in writing by the
Agent), or the creation or existence of any such property, and such person
shall, upon request by the Agent, promptly execute and deliver to the Agent or
cause to be executed and delivered to the Agent pledge agreements, security
agreements, mortgages or other like agreements with respect to such property,
together with such
other documents, certificates, opinions of counsel and the like as the Agent
shall reasonably request in connection therewith, in form and substance
satisfactory to the Agent, such that the Agent shall receive valid and
perfected first priority Liens (subject to Liens permitted hereby) on all
such property (including property which, on the Initial Closing Date, is not
subject to a Lien in favor of the Agent). In addition, in the event that any
Borrower, any Guarantor or any of their respective subsidiaries acquires or
owns any material trademarks, copyrights, patents or other intellectual
property, the Borrowers shall notify the Agent promptly in writing and shall
execute, or cause the execution of a security agreement and other documents
with respect thereto in form and substance reasonably satisfactory to the
Agent. Notwithstanding the foregoing, the Borrowers and Guarantors shall
only be obligated to exercise reasonable efforts to comply with the
requirements of this Section with respect to the granting of mortgages on
leaseholds.
IV. REPRESENTATIONS AND WARRANTIES
Each of the Borrowers and each of the Guarantors jointly and severally
represents and warrants to each of the Lenders that:
SECTION IV.1. Organization, Legal Existence. Each Borrower, each
Guarantor and each of their respective subsidiaries is a legal entity duly
organized, validly existing and in good standing under the laws of the
jurisdiction of their respective organization, has the requisite power and
authority to own their property and assets and to carry on their business as now
conducted and as currently proposed to be conducted and is qualified to do
business in each jurisdiction where the failure to so qualify would not have a
Material Adverse Effect (all such jurisdictions being listed in Schedule 4.01
annexed hereto). Prior to the Initial Closing Date, Acquisition Corp. has not
engaged in any business or incurred any liabilities except for activities,
expenses and liabilities incident to its organization and to the consummation of
the Transactions and the Related Transactions. Each Borrower and each Guarantor
has the corporate power to execute, deliver and perform its obligations under
this Agreement and the other Loan Documents to which it is a party, and, with
respect to each Borrower, to borrow hereunder and to execute and deliver the
Notes.
SECTION IV.2. Authorization. The execution, delivery and performance
by each Borrower and each Guarantor of this Agreement and each of the other Loan
Documents to which it is a party, the borrowings hereunder by each Borrower, the
execution and delivery by each Borrower of the Notes and the grant of security
interests in the Collateral created by the Security Documents (collectively, the
"Transactions") and the consummation by each Borrower, each Guarantor and each
of their respective subsidiaries of the Related Transactions (a) have been duly
authorized by all requisite corporate and, if required, stockholder action and
(b) will not (i) violate (A) any provision of law, statute, rule or regulation
applicable to any Borrower, any
Guarantor or any of their respective subsidiaries or the certificate or
articles of incorporation or other applicable constitutive documents or the
by-laws of any Borrower, any Guarantor or any of their respective
subsidiaries, as the case may be, (B) any order of any court, or any rule,
regulation or order of any other agency of government binding upon any
Borrower, any Guarantor or any of their respective subsidiaries, or (C) any
provisions of any indenture, agreement or other instrument to which any
Borrower, any Guarantor or any of their respective subsidiaries, or any of
their respective properties or assets are or may be bound (which violation
would reasonably be expected to have a Material Adverse Effect), (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 indenture, agreement or other
instrument referred to in (b)(i)(C) above which will remain in effect
following the Initial Closing Date or (iii) result in the creation or
imposition of any Lien of any nature whatsoever (other than in favor of the
Agent, for the benefit of the Secured Parties, as contemplated by this
Agreement and the Security Documents) upon any property or assets of any
Borrower, any Guarantor or any of their respective subsidiaries.
SECTION IV.3. Governmental Approvals. No registration or filing
(other than the filings necessary to perfect the Liens created by the Security
Documents) with, consent or approval of, or other action by, any Federal, state
or other governmental agency, authority or regulatory body is or will be
required on behalf of any Borrower or any Guarantor or any subsidiary of any of
them in connection with the Transactions and the Related Transactions, other
than any which have been made or obtained on the Initial Closing Date and with
respect to the Merger, other than any which will have been made or obtained no
later than the Merger Closing Date, as the case may be, in each case as set
forth on Schedule 4.03.
SECTION IV.4. Binding Effect. This Agreement and each of the other
Loan Documents to which it is a party constitutes, and each of the Notes when
duly executed and delivered will constitute, a legal, valid and binding
obligation of each Borrower and each Guarantor, as appropriate, enforceable in
accordance with its terms, subject to the effect of any applicable bankruptcy,
insolvency, reorganization, moratorium or similar laws affecting creditors'
rights generally and to general principles of equity (regardless of whether
considered in a proceeding in equity or at law).
SECTION IV.5. Material Adverse Change. Since the date of its
corporate formation (in the case of the Acquisition Corp.), and since May 3,
1997 (in the case of the Borrowers and their respective subsidiaries), there has
been no change, event or facts that would reasonably be expected to have a
Material Adverse Effect.
SECTION IV.6. Litigation; Compliance with Laws; etc. (a) There are
not any actions, suits or proceedings at law or in equity or by or before any
governmental instrumentality or other agency or regulatory authority now pending
or, to the knowledge of any Responsible Officer of any Borrower, any Guarantor
or any of their
respective subsidiaries, threatened, against or affecting any Borrower, any
Guarantor or any of their respective subsidiaries or the businesses, assets
or rights of any Borrower, any Guarantor or any of their respective
subsidiaries (i) which involve any of the Transactions or the Related
Transactions or (ii) as to which it is probable (within the meaning of
Statement of Financial Accounting Standards No. 5) that there will be an
adverse determination and which, if adversely determined, would, individually
or in the aggregate, reasonably be expected to have a Material Adverse Effect.
(b) None of the Borrowers, any Guarantor or any of their respective
subsidiaries is in violation of any law in any material respect, or in default
with respect to any judgment, writ, injunction, decree, rule or regulation of
any court or governmental agency or instrumentality which would reasonably be
expected to have a Material Adverse Effect.
SECTION IV.7. Financial Statements. (a) The Borrowers have
heretofore furnished to the Lenders Consolidated balance sheets and statements
of income and cash flows of Jitney Jungle and its Consolidated subsidiaries
dated as of May 3, 1997 audited by and accompanied by the opinion of Deloitte &
Touche, its independent public accountants. Such balance sheets and statements
of income and cash flows present fairly the Consolidated financial condition and
results of operations of Jitney Jungle and its subsidiaries as of the dates and
for the periods indicated, and such balance sheets and the notes thereto
disclose all material liabilities, direct or contingent, of Jitney Jungle and
its subsidiaries, as of the dates thereof to the extent such material
liabilities are required to be disclosed under generally accepted accounting
principles. The Borrowers have heretofore furnished to the Lenders unaudited
Consolidated balance sheets and statements of income and cash flows of Jitney
Jungle and its Consolidated subsidiaries dated as of July 26, 1997, for the
twelve-week fiscal period of Jitney Jungle ending on such date. Such unaudited
balance sheets and statements of income and cash flows present fairly the
Consolidated financial condition and results of operations of Jitney Jungle and
its subsidiaries as of the dates and for the periods indicated, and such balance
sheets and the notes thereto disclose all material liabilities, direct or
contingent, of Jitney Jungle and its subsidiaries as of the dates thereof. The
financial statements referred to in this Section 4.07(a) have been prepared in
accordance with generally accepted accounting principles consistently applied
(with respect to the twelve-week financial statements only, subject to year-end
adjustments).
(b) The Borrowers have, on or about August 21, 1997, furnished to the
Lenders projected income statements, balance sheets, cash flows, Undrawn
Availability forecasts and forecasts as to Excess Cash Flow and as to compliance
with the covenants contained in Sections 7.07, 7.08, 7.09, 7.10 and 7.11 hereof,
in each case of the Borrowers on a Consolidated basis for the period initially
ending May 2, 1998 and for each fiscal year ending thereafter prior to the Final
Maturity Date (which projections shall be on a fiscal month by fiscal month
basis for the fiscal period ending May 2, 1998
and on a yearly basis thereafter), together with a schedule demonstrating
prospective compliance with all financial covenants contained in this
Agreement, such projections disclosing all material assumptions made by
Jitney Jungle and its subsidiaries in formulating such projections and both
before and after giving effect to the Related Transactions and the
Transactions, as applicable. The projections are based upon reasonable
estimates and assumptions, all of which are reasonable in light of the
conditions which existed at the time the projections were made, have been
prepared on the basis of the assumptions stated therein, and reflect as of
the Initial Closing Date the reasonable estimate of Jitney Jungle and its
subsidiaries of the results of operations and other information projected
therein.
(c) The Borrowers have, on or about the Initial Closing Date,
furnished to the Lenders a Consolidated pro forma balance sheet and a statement
of income and cash flows of Jitney Jungle and its subsidiaries, which are
consistent with the previous balance sheets, statements of income and cash flows
of Jitney Jungle and its subsidiaries in all material respects, and which sets
forth information before and after giving effect to the Transactions and the
Related Transactions.
(d) The Borrowers have heretofore furnished to the Lenders
Consolidated balance sheets and statements of income and cash flows of the
Target Company and its Consolidated subsidiaries dated as of June 28,1997
audited by and accompanied by the opinion of KPMG Peat Marwick LLP, its
independent public accountants. Such balance sheets and statements of income
and cash flows present fairly the Consolidated financial condition and results
of operations of the Target Company and its subsidiaries as of the dates and for
the periods indicated, and such balance sheets and the notes thereto disclose
all material liabilities, direct or contingent, of the Target Company and its
subsidiaries, as of the dates thereof to the extent such material liabilities
are required to be disclosed under generally accepted accounting principles.
The financial statements referred to in this Section 4.07(d) have been prepared
in accordance with generally accepted accounting principles consistently
applied.
SECTION IV.8. Federal Reserve Regulations. (a) None of any
Borrower, any Guarantor or any of their respective subsidiaries is engaged
principally, or as one of its important activities, in the business of extending
credit for the purpose of purchasing or carrying Margin Stock.
(b) No part of the proceeds of the Loans will be used, whether
directly or indirectly, and whether immediately, incidentally or ultimately, (i)
to purchase or carry Margin Stock in violation of Regulation G, T, U or X or to
extend credit to others for the purpose of purchasing or carrying Margin Stock
or to refund indebtedness originally incurred for such purpose, or (ii) for any
purpose which entails a violation of, or which is inconsistent with, the
provisions of the Regulations of the Board, including, without limitation,
Regulation G, T, U or X thereof. If requested by any Lender, the Borrowers
or any of their respective subsidiaries shall furnish to such Lender a
statement on Federal Reserve Form U-1 referred to in said Regulation U.
SECTION IV.9. Taxes. The Borrowers, the Guarantors and each of their
respective subsidiaries have each filed or caused to be filed all Federal,
state, local and foreign tax returns which are required to be filed by them,
other than tax returns in respect of taxes that (x) are not franchise, capital
or income taxes, (y) in the aggregate are not material and (z) would not, if
unpaid, result in the imposition of any material Lien on any property or assets
of any Borrower, any Guarantor or any of their respective subsidiaries. The
Borrowers, the Guarantors and their respective subsidiaries have paid or caused
to be paid all taxes shown to be due and payable on such filed returns or on any
assessments received by them, other than any taxes or assessments the validity
of which the Borrowers, the Guarantors or any of their respective subsidiaries
is contesting in good faith by appropriate proceedings, and with respect to
which the Borrowers, the Guarantors or any of their respective subsidiaries
shall, to the extent required by generally accepted accounting principles
consistently applied, have set aside on its books adequate reserves. As of the
Initial Closing Date, no Federal income tax returns of the Borrowers, the
Guarantors or any of their respective subsidiaries are currently being audited
by the United States Internal Revenue Service. All deficiencies which have been
asserted against the Borrowers, the Guarantors or any of their respective
subsidiaries as a result of such completed examinations have been fully paid or
finally settled and no issue has been raised in any such examination which, by
application of similar principles, reasonably can be expected to result in
assertion of a material deficiency for any other year not so examined which has
not been reserved for in any financial statement of the Borrowers, the
Guarantors or any of their respective subsidiaries delivered to the Lenders.
None of the Borrowers, the Guarantors or any of their respective subsidiaries
has taken any reporting positions for which they do not have a reasonable basis
and none of the Borrowers, the Guarantors or any of their respective
subsidiaries anticipates any further material tax liability with respect to the
years which have not been closed. None of the Borrowers, the Guarantors or any
of their respective subsidiaries has as of the date hereof requested or been
granted any extension of time to file any Federal, state, local or foreign tax
return. None of the Borrowers, the Guarantors or any of their respective
subsidiaries is party to or has any obligation under any tax sharing agreement.
SECTION IV.10. Employee Benefit Plans. With respect to the
provisions of ERISA:
(i) No Reportable Event has occurred or is continuing with respect to
any Pension Plan.
(ii) No prohibited transaction (within the meaning of Section 406 of
ERISA or Section 4975 of the Code) has occurred with respect to any Plan subject
to Part 4 of Subtitle B of Title I of ERISA that could subject any Borrower or
any ERISA
Affiliate thereof to a material civil penalty assessed pursuant to the
provisions of Section 502 of ERISA or a material tax imposed under the
provisions of Section 4975 of the Code.
(iii) None of any Borrower or any ERISA Affiliate thereof is now,
or has been during the preceding five years, obligated to contribute to a
Pension Plan or a Multiemployer Plan. None of any Borrower or any ERISA
Affiliate thereof has (A) ceased operations at a facility so as to
become subject to the provisions of Section 4062(e) of ERISA, (B) withdrawn as a
substantial employer so as to become subject to the provisions of Section 4063
of ERISA, (C) ceased making contributions to any Pension Plan subject to the
provisions of Section 4064(a) of ERISA to which any Borrower, any subsidiary
thereof or any ERISA Affiliate thereof made contributions, (D) incurred or
caused to occur a "complete withdrawal" (within the meaning of Section 4203 of
ERISA) or a "partial withdrawal" (within the meaning of Section 4205 of ERISA)
from a Multiemployer Plan that is a Pension Plan so as to incur withdrawal
liability under Section 4201 of ERISA (without regard to subsequent reduction or
waiver of such liability under Section 4207 or 4208 of ERISA), or (E) been a
party to any transaction or agreement under which the provisions of Section 4204
of ERISA were applicable, in each case, which would result in a Material Adverse
Effect.
(iv) No notice of intent to terminate a Pension Plan (other than a
Multiemployer Plan) has been filed, nor has any Plan been terminated pursuant to
the provisions of Section 4041(e) of ERISA which would result in a Material
Adverse Effect.
(v) The PBGC has not instituted proceedings to terminate (or appoint
a trustee to administer) a Pension Plan and no event has occurred or condition
exists which might constitute grounds under the provisions of Section 4042 of
ERISA for the termination of (or the appointment of a trustee to administer) any
such Plan.
(vi) With respect to each Pension Plan (other than a Multiemployer
Plan) that is subject to the provisions of Title I, Subtitle B, Part 3 of ERISA,
the funding method used in connection with such Plan is acceptable under ERISA,
and the actuarial assumptions and methods used in connection with funding such
Pension Plan satisfy the requirements of Section 302 of ERISA. The assets of
each such Pension Plan (other than the Multiemployer Plans) are at least equal
to the present value of the greater of (i) accrued benefits (both vested and
non-vested) under such Plan, or (ii) "benefit liabilities" (within the meaning
of Section 4001(a)(16) of ERISA) under such Plan, in each case as of the latest
actuarial valuation date for such Plan (determined in accordance with the same
actuarial assumptions and methods as those used by the Plan's actuary in its
valuation of such Plan as of such valuation date). No such Pension Plan has
incurred any "accumulated funding deficiency" (as defined in Section 412 of the
Code), whether or not waived, which would result in a Material Adverse Effect.
(vii) There are no actions, suits or claims pending (other than
routine
claims for benefits) or, to the knowledge of any Borrower or any ERISA
Affiliate thereof, which could reasonably be expected to be asserted, against
any Plan (other than a Multiemployer Plan) or the assets of any such Plan which
would cause a Material Adverse Effect. No civil or criminal action brought
pursuant to the provisions of Title I, Subtitle B, Part 5 of ERISA is pending or
threatened against any fiduciary or any Plan (other than a Multiemployer Plan)
which would have a Material Adverse Effect. None of the Plans or any fiduciary
thereof (in its capacity as such) has been the direct or indirect subject of any
audit, investigation or examination by any governmental or quasi-governmental
agency which would have a Material Adverse Effect.
(viii) All of the Plans substantially comply currently, and have
substantially complied in the past, both as to form and operation, with their
terms and with the provisions of ERISA and the Code, and all other applicable
laws, rules and regulations; all necessary governmental approvals for the Plans
have been obtained and a favorable determination as to the qualification under
Section 401(a) of the Code of each of the Plans which is an employee pension
benefit plan (within the meaning of Section 3(2) of ERISA) has been made by the
Internal Revenue Service and a recognition of exemption from federal income
taxation under Section 501(a) of the Code of each of the funded employee welfare
benefit plans (within the meaning of Section 3(1) of ERISA) has been made by the
Internal Revenue Service, and nothing has occurred since the date of each such
determination or recognition letter that would adversely affect such
qualification.
SECTION IV.11. No Material Misstatements. No information, report,
financial statement, exhibit or schedule prepared or furnished by or on behalf
of any Borrower or any Guarantor or any subsidiary of any of them to the Agent
or any Lender in connection with any of the Transactions, the Related
Transactions or this Agreement, the Security Documents, the Notes or any other
Loan Documents or included therein at the time it was prepared contained any
material misstatement of fact or omitted to state any material fact necessary to
make the statements therein, taken together with all other such statements made
to the Agent or any Lender, in the light of the circumstances under which they
were made, not misleading.
SECTION IV.12. Investment Company Act; Public Utility Holding Company
Act. None of the Borrowers, the Guarantors or any of their respective
subsidiaries is an "investment company" as defined in, or is otherwise subject
to regulation under, the Investment Company Act of 1940. None of the Borrowers,
the Guarantors or any of their respective subsidiaries is a "holding company" as
that term is defined in or is otherwise subject to regulation under, the Public
Utility Holding Company Act of 1935.
SECTION IV.13. Security Interest. The Agent has (and each of the
Borrowers confirms the pledge and grant to the Agent, for the benefit of the
Secured Parties, under the Existing Security Documents of a security interest
in the collateral therein described) a legal, valid and perfected security
interest in and Lien on all of
such collateral. Without limitation of the foregoing, each of the Security
Documents creates and grants to the Agent, for the benefit of the Secured
Parties, a valid and perfected first (except as permitted pursuant to Section
7.01 hereof) priority security interest in the collateral identified therein.
Such collateral is not subject to any other Liens whatsoever, except Liens
permitted by Section 7.01 hereof. Schedule 4.13 annexed hereto lists the
jurisdictions in which financing statements or mortgages have been filed as
of the Initial Closing Date.
SECTION IV.14. Bank Accounts. Schedule 4.14 hereto sets forth as of
the Initial Closing Date a list of all bank accounts of the Borrowers.
SECTION IV.15. Capitalization. (a) As of the Initial Closing Date,
the authorized capital stock of Jitney Jungle consists of (i) 5,000,000 shares
of common stock, $0.01 par value per share, of which 425,000 shares shall be
issued and outstanding and (ii) 600,000 shares of preferred stock, par value
$0.01 per share, consisting of (A) 225,000 shares of the Series A Preferred
Stock of which 225,000 shall be issued and outstanding, (B) 275,000 shares of
the Series B Preferred Stock of which 274,460.24 shall be issued and outstanding
and (C) 100,000 shares of the Series C Preferred Stock of which 100,000 shall be
issued and outstanding. The owners of the capital stock of Jitney Jungle and
the number of shares of capital stock owned by each such owner on the Initial
Closing Date and after consummation of the Transactions and the Related
Transactions (other than the Merger) is set forth on Schedule 4.15(a) annexed
hereto. On the Initial Closing Date and after consummation of the Transactions
and the Related Transactions (other than the Merger), except as set forth in
Schedule 4.15(a), Jitney Jungle will have no subsidiaries. Except as set forth
on Schedule 4.15(a), upon issuance thereof and payment therefor, all such
Acquisition Securities have been or shall be duly authorized and validly issued,
are or shall be fully paid and nonassessable and are or shall be free of
preemptive rights. The issuance and sale of the Acquisition Securities either
have been registered or qualified under applicable federal and state securities
laws or are exempt therefrom.
(b) As of the Initial Closing Date and after consummation of the
Transactions and the Related Transactions (other than the Merger), Schedule
4.15(b) annexed hereto sets forth, with respect to each Borrower and each
Guarantor (other than Jitney Jungle), its jurisdiction of incorporation, its
capitalization and the ownership of capital stock of each such Borrower or
Guarantor. None of such Borrowers or Guarantors has any subsidiaries, except as
set forth on Schedule 4.15(b) annexed hereto.
SECTION IV.16. Title to Properties; Possession Under Leases;
Trademarks. (a) Each Borrower, each Guarantor and each of their respective
subsidiaries owns good and marketable, indefeasible fee simple title to all of
the real estate described on Schedule 4.16(a-1) annexed hereto as owned by it
and has a valid leasehold interest in all of the real estate described on
Schedule 4.16(a-2) annexed
hereto as leased by it, in each case (to the best of Borrowers' knowledge
with respect to leases) free and clear of all Liens or other encumbrances of
any kind, except as described in Schedule 4.16(a-2) annexed hereto and except
Liens permitted under Section 7.01 hereof. Schedules 4.16(a-1) and 4.16(a-2)
annexed hereto correctly identify as of the Initial Closing Date, (x) each
parcel of real property owned by such Borrower, such Guarantor or such
subsidiary, together in each case with an accurate street address and
description of the use of such parcel, (y) each parcel of real property
leased by or to such Borrower, such Guarantor or such subsidiary, together in
each case with an accurate street address and description of the use of such
parcel, and (z) each other interest in real property owned, leased or granted
to or held by such Borrower, such Guarantor or such subsidiary. Except as
set forth on Schedules 4.16(a-1) and 4.16(a-2):
(i) no structure owned or leased by any Borrower, any Guarantor
or any of their respective subsidiaries fails to conform in any material
respect with applicable ordinances, regulations, zoning laws and
restrictive covenants (including in any such case and without limitation
those relating to environmental protection) nor encroaches upon property of
others, nor is any such real property encroached upon by structures of
others in any case in any manner that would have or would be reasonably
likely to have a Material Adverse Effect on the Agent's or Lenders' interest
in any Collateral located on the premises or otherwise would have or would
be reasonably likely to have a Material Adverse Effect;
(ii) no charges or violations have been filed, served, made or
threatened, to the knowledge of such Borrower or Guarantor, against or
relating to any such property or structure or any of the operations
conducted at any such property or structure, as a result of any violation or
alleged violation of any applicable ordinances, requirements, regulations,
zoning laws or restrictive covenants (including in any such case and
without limitation those relating to environmental protection) or as a
result of any encroachment on the property of others where the effect of
same would have or would be reasonably likely to have a Material Adverse
Effect on the Agent's or Lenders' interest in any Collateral located on the
premises or otherwise would have or would be reasonably likely have a
Material Adverse Effect;
(iii) other than pursuant to applicable laws, rules,
regulations or ordinances, covenants that run with the land or provisions in
the applicable leases, there exists no restriction on the use, transfer or
mortgaging of any such property;
(iv) such Borrower, such Guarantor and/or such subsidiary each
have adequate permanent rights of ingress to and egress from any such
property used by it for the operations conducted thereon;
(v) there are no developments affecting any of the real property
or interests therein pending or (to the best of Borrowers' knowledge)
threatened which might reasonably be expected to curtail or interfere in
any material respect with the use of such property for the purposes for
which it is now used; and
(vi) as of the Initial Closing Date, none of the Borrowers, the
Guarantors or any of their respective subsidiaries has any obligation to
acquire any interest in, any real property.
(b) Except as set forth in Schedule 4.16(a-2), each Borrower, each
Guarantor and each of their respective subsidiaries owns and has good and
marketable title to all the owned properties and assets reflected on its most
recent balance sheet and valid leasehold interests in the property it leases
subject to no Liens except Liens permitted under Section 7.01, and all such
leases are in full force and effect and each Borrower, each Guarantor and each
of their respective subsidiaries enjoys peaceful and undisturbed possession
under all such leases, other than assets permitted to be sold under this
Agreement, leases terminated in the ordinary course of business and disputes
with lessors being pursued in good faith.
(c) Each Borrower, each Guarantor and each of their respective
subsidiaries own or control or have the right to use all trademarks, trademark
rights, trade names, trade name rights, copyrights, patents, patent rights and
licenses which are material to the conduct of the business of such Borrower,
such Guarantor or such subsidiary. To the best of such Borrower's or such
Guarantor's knowledge, as applicable, none of such Borrower, such Guarantor or
any of their respective subsidiaries is infringing upon or otherwise acting
adversely to any of such trademarks, trademark rights, trade names, trade name
rights, copyrights, patent rights or licenses owned by any other person or
persons. There is no claim or action by any such other person pending, or to
the knowledge of any Responsible Officer of such Borrower or such Guarantor, as
applicable, threatened against such Borrower or such Guarantor, or any of their
respective subsidiaries with respect to any of the rights or property referred
to in this Section 4.16(c), except as would not reasonably be expected to have a
Material Adverse Effect.
SECTION IV.17. Solvency. Both before and after giving effect to the
Related Transactions,
(a) The fair salable value of the assets of each of Jitney Jungle and
each of its Consolidated subsidiaries is not less than the amount that will be
required to be paid on or in respect of the probable liability on the existing
debts and other liabilities (including contingent liabilities) of Jitney Jungle
and each such Consolidated subsidiary, as they become absolute and mature.
(b) The assets of each of Jitney Jungle and each of its Consolidated
subsidiaries do not constitute unreasonably small capital for Jitney Jungle and
such Consolidated subsidiaries to carry out their respective businesses as now
conducted and as proposed to be conducted including the capital needs of Jitney
Jungle and such Consolidated subsidiaries, taking into account the particular
capital requirements of the business conducted by Jitney Jungle and each such
Consolidated subsidiary and projected capital requirements and capital
availability thereof.
(c) None of the Borrowers or any of their respective subsidiaries
intends to incur debts beyond its ability to pay such debts as they mature
(taking into account the timing and amounts of cash to be received by the Target
Company and its subsidiaries, and of amounts to be payable on or in respect of
debt of the Target Company and its subsidiaries). The cash flow of each of
Jitney Jungle and its Consolidated subsidiaries, after taking into account all
anticipated uses of the cash of Jitney Jungle and its Consolidated subsidiaries,
will at all times be sufficient to pay all such amounts on or in respect of debt
of Jitney Jungle and its Consolidated subsidiaries when such amounts are
required to be paid.
(d) None of the Borrowers nor any of their respective subsidiaries
believes that final judgments against them in actions for money damages
presently pending will be rendered at a time when, or in an amount such that,
they will be unable to satisfy any such judgments promptly in accordance with
their terms (taking into account the maximum reasonable amount of such judgments
in any such actions and the earliest reasonable time at which such judgments
might be rendered). The cash flow of each of Jitney Jungle and each of its
Consolidated subsidiaries, after taking into account all other anticipated uses
of the cash of Jitney Jungle and its Consolidated subsidiaries (including the
payments on or in respect of debt referred to in paragraph (c) of this Section),
will at all times be sufficient to pay all such judgments promptly in accordance
with their terms.
SECTION IV.18. Permits, etc. Each Borrower, each Guarantor and each
of their respective subsidiaries possesses all licenses, permits, approvals and
consents, including, without limitation, all environmental, health and safety
licenses, permits, approvals and consents of all Federal, state and local
governmental authorities which are required under Environmental Law and are
material to the conduct of its business (collectively, "Permits"), other than as
set forth on Schedule 4.18; each such Permit is and will be in full force and
effect; each Borrower, each Guarantor and each of their respective subsidiaries
is in compliance in all material respects with all such Permits, and, to its
knowledge, no event (including, without limitation, any material violation of
any law, rule or regulation) has occurred which would be likely to lead to the
revocation or termination of any such Permit or any additional restriction
thereon, except as such Permits expire and must be reissued due to the passage
of time.
SECTION IV.19. Compliance with Environmental Laws. (i) The
operations of each Borrower, each Guarantor and their respective subsidiaries
comply in all material respects with all applicable Environmental Laws;
(ii) none of any Borrower, any Guarantor or any of their respective subsidiaries
and all of their present facilities or operations, as well as to their
knowledge, their past facilities or operations, are subject to any judicial
proceeding, administrative proceeding or written order or agreement with any
governmental authority or private party respecting (a) any Environmental Law,
(b) any Remedial Work, or (c) any Environmental Claims arising from the Release
of a Hazardous Material into the environment, except as would not reasonably be
expected to have a Material Adverse Effect; (iii) none of the operations of any
Borrower, any Guarantor or any of their respective subsidiaries are the subject
of any Federal or state investigation evaluating whether any Remedial Work is
needed to respond to a Release of any Hazardous Material into the environment in
violation of any Environmental Law, except as would not reasonably be expected
to have a Material Adverse Effect; (iv) none of any Borrower, any Guarantor or
any of their respective subsidiaries or any predecessor of any Borrower, any
Guarantor or any of their respective subsidiaries have filed any notice under
any Environmental Law indicating past or present treatment, storage, or disposal
of a Hazardous Material in material violation of any Environmental Law or
reporting a material spill or Release of a Hazardous Material into the
environment in violation of any Environmental Law, except for spills the
responses to which would not collectively reasonably be expected to have a
Material Adverse Effect; (v) to the best of Borrowers' knowledge, none of any
Borrower, any Guarantor or any of their respective subsidiaries have any
contingent liability in connection with any Release of any Hazardous Material
into the environment, except as would not reasonably be expected to have a
Material Adverse Effect; (vi) none of the operations of any Borrower, any
Guarantor or any of their respective subsidiaries involve the generation,
transportation, treatment or disposal of Hazardous Materials except in
compliance with all Environmental Laws, except as would not reasonably be
expected to have a Material Adverse Effect; (vii) none of any Borrower, any
Guarantor or any of their respective subsidiaries has disposed of any Hazardous
Material by placing it in or on the ground or waters of any premises owned,
leased or used by any of them and to the knowledge of such Borrower, such
Guarantor and such subsidiaries, neither has any lessee, prior owner or other
person, except as would not reasonably be expected to have a Material Adverse
Effect; (viii) no underground storage tanks or surface impoundments are on any
property of any Borrower, any Guarantor or any of their respective subsidiaries,
except as would not reasonably be expected to have a Material Adverse Effect;
and (ix) no Lien in favor of any governmental authority for (A) any liability
under any Environmental Law or regulation, or (B) damages arising from or costs
incurred by such governmental authority in response to a Release of a Hazardous
Material into the environment, has been filed or attached to the property of any
Borrower, any Guarantor or any of their respective subsidiaries.
SECTION IV.20. Material Agreements. Schedule 4.20 hereto sets forth
as of the Initial Closing Date a list of all material agreements, contracts and
instruments
to which each Borrower, each Guarantor and each of their respective
subsidiaries is a party or by which any of such persons is bound and all
amendments, modifications and supplements to each of the foregoing. With
respect to Delchamps, the foregoing representation is being made to the best
of the Borrowers' knowledge.
SECTION IV.21. Acquisition. (a) (i) The execution, delivery and
performance by each party to the Merger Documents have been duly authorized
by all necessary action on the part of each such party, and with respect to
each party other than Acquisition Corp. or any Borrower, (ii) the Merger
Documents constitute the valid, binding and enforceable obligation of each
party thereto, subject to the effect of any applicable bankruptcy,
insolvency, reorganization, moratorium or similar laws affecting creditors'
rights generally, and are in full force and effect without default or waiver
of any of the conditions thereunder, and (iii) there are no governmental
consents, filings, approvals or notices required to be made or obtained in
connection with the execution, delivery and performance of the Merger
Documents, except such as have been duly made, obtained or delivered or will
on the Initial Closing Date and on the Merger Closing Date, be duly made,
obtained or delivered.
(b) Each of the representations and warranties made by each party to
the Merger Documents is true and correct in all material respects, except
with respect to each party other than Acquisition Corp. or Jitney Jungle, any
which would not reasonably be expected to have a Material Adverse Effect, and
such representations and warranties are hereby incorporated herein by
reference with the same effect as though made by each of Acquisition Corp.
and Jitney Jungle and set forth herein in their entirety.
SECTION IV.22. The Tender Offer and Merger. (a) The Tender Offer
complies with all provisions of all applicable laws and regulations of the
United States and each applicable state thereof, including without limitation
the State of Alabama (including, without limitation, anti-takeover statutes
and regulations).
(b) All consents and approvals of, filings, notices and registrations
with, and all other actions in respect of, all governmental agencies,
authorities or instrumentalities required to be obtained, given, filed or taken
by the Borrowers in order to make or consummate the Tender Offer, to purchase
Tendered Securities pursuant thereto or to consummate the Merger have been or,
prior to the time when required, will have been, obtained, given, filed or taken
and are or will be in full force and effect, and all applicable waiting periods
have, or prior to the time when required, will have expired without, in all
cases, any action being taken which restrains, prevents, imposes or threatens
adverse conditions upon or hinders the consummation of the Tender Offer or the
purchase of Tendered Securities thereunder or the consummation of the Merger.
There does not exist any judgment, order, injunction or other restraint issued
or filed or a hearing seeking injunctive relief or other restraints pending or
noticed with respect to any of the transactions contemplated by the Merger
Documents and the Tender Offer Documents, including without limitation, with
respect to the consummation of the
Tender Offer or the Merger.
(c) At the time of their dissemination to the public, the Offer to
Purchase and any other Tender Offer Documents and any amendments or
supplements thereto, copies of which have been delivered to the Agent and the
Lenders, did not and will not contain any untrue statement of a material fact
or omit to state any material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading.
SECTION IV.23. Broker's Fees. Except as set forth in Schedule
4.23 annexed hereto, no broker's or finder's fee, commission or similar
compensation has been or will be payable with respect to the issuance and
sale of the Senior Subordinated Notes or any of the Transactions or the
Related Transactions. No other similar fees or commissions will be payable
by any Person for any other services rendered to the Target Company or any
Borrower ancillary to the Transactions or the Related Transactions.
V. CONDITIONS OF CREDIT EVENTS
The obligation of each Lender to make Loans and provide other Credit
Events hereunder shall be subject to the following conditions precedent:
SECTION V.1. All Credit Events. On each date on which a Credit
Event is to occur:
(a) The Agent shall have received a notice of borrowing as required
by Section 2.03 hereof or a notice of the issuance of a Letter of Credit
as required by Section 2A.01 hereof, as appropriate.
(b) The representations and warranties set forth in Article IV
hereof and in any documents delivered herewith, including, without
limitation, the Loan Documents, shall be true and correct in all material
respects with the same effect as though made on and as of such date
(except insofar as such representations and warranties relate expressly
to an earlier date).
(c) The Borrowers shall be in compliance with all the terms and
provisions contained herein on their part to be observed or performed,
and at the time of and immediately after such Credit Event, no Default or
Event of Default shall have occurred and be continuing.
(d) The Agent shall have received a certificate signed by the
Financial Officer of the Borrowers (i) as to the compliance with (b) and
(c) above and (ii) with respect to each Loan and each Letter of Credit,
demonstrating that after
giving effect thereto the Undrawn Availability is zero or greater and
Section 2.20 has been complied with. In the absence of delivery of the
certificate set forth in this Section 5.01(d), each notice of borrowing
and/or notice of issuance of Letter of Credit under Section 5.01(a) shall
be deemed to include the certification described in this Section 5.01(d).
SECTION V.2. Initial Closing Date. The obligations of the Lenders
in respect of the first Credit Event hereunder are subject to the following
additional conditions precedent:
(a) The Agent and the Lenders shall have received the
favorable written opinion(s) of (i) counsel for each of the Borrowers,
the Guarantors and the Grantors, substantially in the forms of Exhibit B
annexed hereto, dated the Initial Closing Date, addressing such matters
and from such jurisdictions as shall be requested by the Agent
(including, without limitation, opinions from Alabama, Louisiana and
Mississippi counsel to the Borrowers, opinions from counsel licensed in
the relevant jurisdictions of incorporation of each of the Borrowers and
the Guarantors and the Grantors), addressed to the Agent and the Lenders
and satisfactory to the Agent, and (ii) counsel for the Target Company
and its subsidiaries, dated the Initial Closing Date, addressing such
matters as shall be requested by the Agent, addressed to the Agent and
the Lenders and satisfactory to the Agent.
(b) The Agent and the Lenders shall have received (i) a copy of the
certificate or articles of incorporation or constitutive documents, in
each case as amended to date, of each of the Borrowers, the Grantors and
the Guarantors, certified as of a recent date by the Secretary of State
or other appropriate official of the state of its organization, and a
certificate as to the good standing of each from such Secretary of State
or other official, in each case dated as of a recent date; (ii) a
certificate of the Secretary of each of the Borrowers, Grantors and
Guarantors, dated the Initial Closing Date and certifying (A) that
attached thereto is a true and complete copy of such person's By-laws as
in effect on the date of such certificate and at all times since a date
prior to the date of the resolution described in item (B) below, (B) that
attached thereto is a true and complete copy of a resolution adopted by
such person's Board of Directors authorizing the execution, delivery and
performance of this Agreement, the Security Documents, the Notes, the
other Loan Documents, the Credit Events hereunder and the consummation of
the Related Transactions, as applicable, and that such resolution has not
been modified, rescinded or amended and is in full force and effect, (C)
that such person's certificate or articles of incorporation or
constitutive documents has not been amended since the date of the last
amendment thereto shown on the certificate of good standing furnished
pursuant to (i) above, and (D) as to the incumbency and specimen
signature of each of such person's officers executing this Agreement, the
Notes, each Security Document or any
other Loan Document delivered in connection herewith or therewith, as
applicable; (iii) a certificate of another of such person's officers as
to incumbency and signature of its Secretary; and (iv) such other
documents as the Agent or any Lender may reasonably request.
(c) The Agent shall have received a certificate, dated the Initial
Closing Date and signed by the Financial Officer of each of the
Borrowers, confirming compliance with the conditions precedent set forth
in paragraphs (b) and (c) of Section 5.01 hereof and the conditions set
forth in this Section 5.02.
(d) Each Lender shall have received its Note, each duly executed by
the Borrowers, payable to its order and otherwise complying with the
provisions of Section 2.04 hereof.
(e) The Agent shall have received the Security Documents (other
than the Partnership Pledge Agreement), certificates evidencing the
Pledged Stock (including, without limitation, the capital stock of
Acquisition Corp. and the Tendered Securities (other than with respect to
those Tendered Securities which are subject to guaranteed delivery
procedures and which shall be subsequently delivered to the Agent)),
together with undated stock powers executed in blank, each duly executed
by the applicable Grantors, and each of the other documents, instruments,
insurance policies and agreements requested by the Agent.
(f) The Agent shall have received certified copies of requests for
copies or information on Form UCC-11 or certificates satisfactory to the
Lenders of a UCC Reporter Service, listing all effective financing
statements which name as debtor any Borrower, any Guarantor or any
Grantor and which are filed in the appropriate offices in the States in
which are located the chief executive office and other operating offices
of such person or where Collateral is located, together with copies of
such financing statements. With respect to any Liens not permitted
pursuant to Section 7.01 hereof, the Agent shall have received
termination statements, and/or payoff letters which provide further
assurances regarding the provision of termination statements, in form and
substance satisfactory to it.
(g) Each document (including, without limitation, each Uniform
Commercial Code financing statement) required by law or requested by the
Agent to be filed, registered or recorded in order to create in favor of
the Agent for the benefit of the Secured Parties a first priority
perfected security interest in the Collateral shall have been properly
filed, registered or recorded in each jurisdiction in which the filing,
registration or recordation thereof is so required or requested. The
Agent shall have received an acknowledgment copy, or other evidence
satisfactory to it, of each such filing, registration or recordation.
(h) The Agent shall have received the results of a search of the
Uniform Commercial Code filings made with respect to each Borrower and
each Grantor and Guarantor in the jurisdictions in which Uniform
Commercial Code filings have been made against each Borrower, each
Guarantor and each Grantor pursuant to paragraph (g) above, and such
results shall be satisfactory to the Agent.
(i) The Lenders and the Agent shall have received and determined to
be in form and substance satisfactory to them:
(i) the most recent (dated within thirty (30) days of the
Initial Closing Date) schedule of inventory designations of the
Borrowers together with sales and other financial information
requested by the Agent, in the form attached hereto as Exhibit J;
(ii) evidence that, (A) immediately after giving effect to the
consummation of the Related Transactions on a pro forma basis
(including, without limitation, payment of the aggregate
consideration payable to acquire 100% of the Target Stock on a fully
diluted basis pursuant to the Tender Offer and the Merger) and after
the payment of all anticipated fees, costs and expenses in
connection with the Related Transactions, and with all trade
payables aged in accordance with normal terms, the Borrowers will
have Undrawn Availability plus cash on hand on the Initial Closing
Date in an amount not less than $35,000,000, and (B) at all times
prior to the consummation of the Merger, the Borrowers will have
Undrawn Availability plus cash on hand in an amount sufficient to
acquire all shares of capital stock of the Target Company (except
those Tendered Securities previously acquired by Jitney Jungle or
Acquisition Corp.) and the Agent may reserve from the Undrawn
Availability an amount solely for such purpose and not otherwise
available to the Borrowers;
(iii) copies of the Senior Subordinated Indenture and the
Senior Subordinated Notes, each certified by a Responsible Officer
of Jitney Jungle. The Senior Subordinated Notes shall be issued
pursuant to terms and conditions satisfactory to the Agent and the
Lenders in all respects, and the Agent and the Lenders shall have
received evidence satisfactory to the Agent and the Lenders of the
receipt by the Borrowers of gross cash proceeds of not less than
$200,000,000 thereunder. The entire proceeds of the Senior
Subordinated Notes shall be applied by Acquisition Corp. towards
payment of the purchase price of the Tendered Securities and the
consummation of the Related Transactions (other than the Merger) on
the Initial Closing Date. The aggregate consideration payable under
the Merger Agreement (including cash and all other consideration)
paid by Acquisition Corp. in connection with the Related Transactions
(other than the initial borrowings under the Commitment on the
Initial Closing Date) shall not exceed $24,500,000;
(iv) a copy of a field examination of the books and records of
Jitney Jungle and its subsidiaries;
(v) evidence of the compliance by the Borrowers with Section
6.03 hereof;
(vi) the financial statements described in Section 4.07 hereof,
and with respect to the financial statements delivered pursuant to
Section 4.07(c), a certificate dated the Initial Closing Date signed
by the Financial Officer of Jitney Jungle, to the effect that such
financial statements have been prepared by such Financial Officer in
accordance with generally accepted accounting principles
consistently applied, and satisfactory in all respects to the Agent,
and confirming that such statements are consistent with drafts
thereof previously delivered to the Agent;
(vii) evidence that the Transactions and the Related
Transactions are in compliance with all applicable laws and
regulations;
(viii) evidence of payment of all fees owed to the Agent and
the Lenders by the Borrowers under this Agreement, the Commitment
Letter, the Fee Letter or otherwise;
(ix) the results of an environmental analysis with respect to
the Target Company and its subsidiaries' properties and operations
conducted by a firm satisfactory to the Agent and the Lenders, and
the scope, methodology and results of such environmental analysis
shall be satisfactory to the Agent and the Lenders in all respects;
(x) the results of surveys and appraisals of the Target
Company's and its subsidiaries' machinery, equipment and real
property (in any event complying with any applicable law, including,
without limitation, FIRREA), conducted by a firm satisfactory to the
Agent and the Lenders, and satisfactory to the Agent and the Lenders
in all respects;
(xi) copies of all major customer and supplier contracts with
respect to the Target Company and its subsidiaries and each
Borrower;
(xii) evidence that all requisite third party consents and
waivers (including, without limitation, consents from the holders of
the Senior Notes) to the Transactions and the Related Transactions,
have been received;
(xiii) evidence that there has been no material adverse
change in the business, assets, liabilities, properties, prospects,
operations or financial or other condition of (i) (A) Jitney Jungle
and its subsidiaries, taken as a whole, since May 3, 1997 or (B) the
Target Company and its subsidiaries, taken as a whole, since March
29, 1997 or (ii) (A) Jitney Jungle and its subsidiaries, taken as a
whole, or (B) the Target Company and its subsidiaries, taken as a
whole, in each case, from that described in the Pre-Commitment
Information (as defined in the Commitment Letter);
(xiv) evidence that all of the Pre-Commitment Information (as
defined in the Commitment Letter) shall be true and correct in all
material aspects; and no development or change shall have occurred
(A) which has resulted in or could reasonably be expected to result
in a material adverse change in, or material adverse deviation from,
the Pre-Commitment Information or (B) which has had or could
reasonably be expected to have a Material Adverse Effect or a
material adverse effect on the business, assets, liabilities,
properties, prospects, operations or financial condition of the
Target Company and its subsidiaries taken as a whole;
(xv) evidence that there are no actions, suits or proceedings
at law or in equity or by or before any governmental instrumentality
or other agency or regulatory authority now pending or threatened
against or affecting the Target Company, any Borrower, any
Guarantor, any Grantor, any of their respective subsidiaries,
businesses, assets or rights, any of the Collateral, the Agent or
any Lender (A) which could reasonably be expected to have a Material
Adverse Effect or a material adverse effect on the business,
assets, liabilities, properties, prospects, operations or financial
condition of the Target Company and its subsidiaries taken as a
whole or which may materially impair the ability of any Borrower,
any Grantor or any Guarantor to perform its obligations under any
Loan Document to which it is a party or the rights and remedies of
the Agent and the Lenders under this Agreement and the Security
Documents or (B) which purport to adversely affect any of the
Transactions or the Related Transactions; and
(xvi) evidence that (A) immediately prior to the Credit Events
on the Initial Closing Date, the Target Indebtedness shall not
exceed $16,225,000 and (B) there shall be no outstanding
Indebtedness (other than Indebtedness outstanding hereunder and the
Prior Indebtedness), or that such Indebtedness (other than
Indebtedness outstanding hereunder and the Prior Indebtedness) shall
be concurrently with the Credit Events
on the Initial Closing Date, satisfied in full and that all Liens
securing any obligations arising thereunder shall have been
released.
(j) The Agent and the Lenders shall have had the opportunity, if
they so choose, to examine the books of account and other records and
files of the Target Company, Acquisition Corp., the Borrowers, the
Grantors and the Guarantors and their respective subsidiaries to make
copies thereof, and to conduct a pre-closing audit or perform other due
diligence which shall include, without limitation, verification of
payment of payroll taxes and accounts payable, formulation of an opening
Borrowing Base and review of tax, environmental, employee benefit and
labor issues, and the results of such examination, audit and due
diligence shall have been reasonably satisfactory to the Agent and
Lenders in all respects. None of the information submitted prior to the
Initial Closing Date shall have been or become, taken together with all
other such information submitted prior to the Initial Closing Date,
false, incomplete or inaccurate in any material and adverse respect, and
none of the conditions represented or indicated by BRS, Acquisition
Corp., the Target Company, any Borrower or any of their respective
subsidiaries to exist shall change in any material and adverse respect.
(k) The Agent shall have received and had the opportunity to review
and determine to be in form and substance satisfactory to it:
(i) copies of all lease agreements entered into by the Target
Company, any Borrower, any Guarantor, any Grantor and/or any of
their respective subsidiaries; and
(ii) copies of all loan agreements, notes and other
documentation evidencing Indebtedness for borrowed money of the
Target Company, any Borrower, any Guarantor, any Grantor and/or any
of their respective subsidiaries (including, without limitation,
certified copies of any amendments to or consents under the Senior
Indenture, together with all exhibits and schedules thereto, and all
certificates, documents and opinions delivered in connection
therewith) and of all other material agreements of any of them.
(l) Messrs. Xxxx, Scholer, Fierman, Xxxx & Handler, LLP, counsel to
the Agent, shall have received payment in full for all legal fees
charged, and all costs and expenses incurred, by such counsel through the
Initial Closing Date in connection with the transactions contemplated
under this Agreement, the Security Documents and the other Loan Documents
and instruments in connection herewith and therewith.
(m) The Agent and the Lenders shall have:
(i) received copies of each of the Merger Documents and the
Tender Offer Documents, including all amendments and schedules
thereto, each certified by a Responsible Officer of Jitney Jungle;
(ii) received evidence that Acquisition Corp. shall have
acquired and shall hold the unrestricted right to vote such
percentage of the Target Stock on a fully diluted basis, free and
clear of all Liens (other than the Lien in favor of the Agent), as
may be necessary for shareholder approval by the shareholders of the
Target Company of the Merger (the "Minimum Percentage") and, to the
extent such Target Stock shall have been acquired pursuant to the
Tender Offer, such acquisition shall have occurred upon full
satisfaction, without waiver, of the conditions to purchase
contained in the Offer to Purchase. For purposes of the preceding
sentence, shares acquired which were tendered pursuant to guaranteed
delivery procedures shall not be considered as acquired in
calculating the Minimum Percentage;
(iii) received evidence that the Merger Agreement is in full
force and effect without default thereunder by any party thereto and
all consents, filings and approvals required by applicable law in
connection therewith shall have been obtained and made, except as
set forth on Schedule 4.03 annexed hereto;
(iv) received evidence that (A) the Related Transactions shall
(x) have been duly approved by the Boards of Directors of each of
Acquisition Corp., Jitney Jungle, the Target Company and their
respective subsidiaries, (y) be in compliance in all respects with
the articles of incorporation and by-laws of Acquisition Corp.,
Jitney Jungle, the Target Company and each of their respective
subsidiaries and all applicable laws and regulations of the United
States, any state thereof and any subdivision of any such state and
(z) have been duly approved by the vote of the requisite number of
shareholders of Acquisition Corp., Jitney Jungle, the Target Company
and each of their respective subsidiaries; (B) the Target Company's
"poison pill" provisions, if any, shall be inapplicable to the
Tender Offer and the Merger in a manner satisfactory in all respects
to the Agent; and (C) all conditions precedent to the consummation
of the Related Transactions shall have been satisfied, subject only
to the conditions set forth in the Merger Agreement;
(v) received a table setting forth the sources and uses of
funds in connection with the acquisition of the Target Stock
pursuant to the Tender Offer and the financing thereof and a table
setting forth the capitalization of Jitney Jungle, giving effect to
the acquisition of the Target
Stock pursuant to the Tender Offer and the financing thereof, each
of the foregoing to be satisfactory to the Agent in all respects;
(vi) (A) determined that the terms of the Tender Offer as set
forth in the Offer to Purchase shall be in form and substance
reasonably satisfactory to the Agent in all respects and received
evidence that none of the principal terms of the Offer to Purchase
and none of the conditions contained therein shall have been
modified, amended, supplemented or waived and none of the conditions
to the Tender Offer contained therein shall remain unsatisfied, and
(B) received evidence that the acceptance of the Tender Offer by the
holders of the Target Stock shall have occurred in accordance with
the terms thereof, without modification, amendment, supplement or
waiver (except with the prior written consent of the Agent);
(vii) (A) received evidence that the Transactions and the
Related Transactions (including, without limitation, the purchases
contemplated by the Tender Offer), shall comply with Regulations G,
T, U and X (as the case may be) and all other regulations of the
Board of Governors of the Federal Reserve System and shall comply
with, and be permitted by, all laws, rules and regulations of the
United States (including, without limitation, the Xxxx-Xxxxx-Xxxxxx
Antitrust Improvements Act of 1976) or any State thereof (including,
without limitation, environmental laws) and (B) received evidence
that (1) all necessary United States or state governmental and third
party consents in connection therewith shall have been obtained, and
shall be in full force and effect, (2) all applicable waiting
periods under applicable law shall have expired without action being
taken by any competent authority which restrains, prevents or
imposes materially adverse conditions upon the consummation of the
Tender Offer or the Merger, and (3) no law or regulation shall be
applicable in the judgement of the Agent and the Lenders which
restrains, prevents or imposes materially adverse conditions upon
any aspect of the Transactions or the Related Transactions; and
(x) determined that the terms and provisions of all agreements
and documents in connection with the Related Transactions,
including, without limitation, the Merger Documents and the Tender
Offer Documents, and the business, operations and assets being
acquired thereunder and liabilities being assumed thereunder
(including, without limitation, with respect to tax matters,
environmental matters, employee benefit plans and labor plans and
labor relations) are in each instance satisfactory in form and
substance to the Agent and the Lenders and the Agent shall have
received such legal opinions, certificates and copies of necessary
governmental filings and consents as the Agent shall have requested
in connection therewith, and shall have determined to its
satisfaction that the consummation of the Related Transactions and
other transactions contemplated by the Merger Documents and the
Tender Offer Documents are in compliance with all applicable laws
(including, without limitation, state anti-takeover laws) and
regulations and will not violate any agreements, instruments or
documents to which the Target Company, Acquisition Corp., Jitney
Jungle, any member of the Investor Group or any of their respective
subsidiaries is a party or may be bound. The final terms and
conditions of the Related Transactions (including, without
limitation, the terms and conditions of the Merger Agreement),
including, without limitation, all legal and tax aspects thereof,
shall be as described herein and otherwise consistent in all
material respects with the description thereof received in writing
as part of the Pre-Commitment Information (as defined in the
Commitment Letter).
(n) The Agent and the Lenders shall have received certificates from
the chief financial officer of each Borrower and each Guarantor, in form
and substance satisfactory to the Agent and the Lenders, attesting to the
"solvency" of such Borrower and such Guarantors, as the case may be, in
each case individually and together with its subsidiaries, taken as a
whole, immediately before and immediately after giving effect to the
Transaction, determined on in accordance with generally accepted
accounting principles, consistently applied. As used herein, the term
"solvency" of any person means (i) the fair value of the property of such
person exceeds its total liabilities (including, without limitation,
contingent liabilities), (ii) the present fair saleable value of the
assets of such person is not less than the amount that will be required
to pay its probable liability on its debts as they become absolute and
matured, (iii) such person does not intend to, and does not believe that
it will, incur debts or liabilities beyond its ability to pay as such
debts and liabilities mature and (iv) such person is not engaged, and is
not about to engage, in business or a transaction for which its property
would constitute an unreasonably small capital;
(o) The corporate structure and capitalization of each Borrower,
each Guarantor and each of their respective subsidiaries shall be
reasonably satisfactory to the Agent and the Lenders in all respects.
(p) All legal matters in connection with the Transactions and the
Related Transactions shall be reasonably satisfactory to the Agent, the
Lenders and their respective counsel in their sole discretion.
(q) The Borrowers shall have executed and delivered to the Agent a
disbursement authorization letter with respect to the disbursement of the
proceeds of the Credit Events made on the Initial Closing Date, in form
and substance satisfactory to the Agent.
(r) The Borrowers shall have entered into blocked account and other
cash management arrangements pursuant to documentation satisfactory in
form and substance to the Agent as contemplated by Section 10.01 hereof.
(s) The Agent shall have received such other documents as the
Lenders or the Agent or Agent's counsel shall reasonably deem necessary.
SECTION V.3. Merger Closing Date. The obligations of the Lenders
on the Merger Closing Date are subject to the following additional conditions
precedent:
(a) The Agent and the Lenders shall have received the favorable
written opinion(s) of counsel for each of the Borrowers, the Guarantors
and the Grantors, dated the Merger Closing Date, from such jurisdictions
and addressing such matters as shall be reasonably requested by the
Agent, addressed to the Agent and the Lenders and satisfactory to the
Agent.
(b) The Agent and the Lenders shall have received (i) a copy of the
certificate or articles of incorporation or constitutive documents, in
each case as amended to date, of each of the Borrowers, the Acquisition
Corp., the Target Company and their respective subsidiaries, certified as
of a recent date by the Secretary of State or other appropriate official
of the state of its organization (or, a certification to the effect set
forth in clause (ii)(C) below), and to the extent requested by the Agent,
a certificate as to the good standing of each from such Secretary of
State or other official, in each case dated as of a recent date; (ii) a
certificate of the Secretary of each of the Borrowers, Acquisition Corp.,
the Target Company and their respective subsidiaries, dated the Merger
Closing Date and certifying (A) that attached thereto is a true and
complete copy of such person's By-laws as in effect on the date of such
certificate and at all times since a date prior to the date of the
resolution described in item (B) below (or, that such By-laws have not
been amended since the Initial Closing Date), (B) that attached thereto
is a true and complete copy of a resolution adopted by such person's
Board of Directors authorizing the consummation of the Related
Transactions, as applicable, and that such resolution has not been
modified, rescinded or amended and is in full force and effect, (C) that
such person's certificate or articles of incorporation or constitutive
documents has not been amended since the date of the last amendment
thereto shown on the certificate of good standing furnished pursuant to
clause (i) above, and (D) as to the incumbency and specimen signature of
each of such person's officers executing any document delivered in
connection herewith or contemplated hereby, as applicable (or, a
certification to the effect that the officers authorized to execute
documents in connection with the Initial Closing Date are still
authorized and incumbent officers of such person); and (iii) a
certificate of another of such person's officers as to incumbency and
signature of its Secretary.
(c) The Agent shall have received a certificate, dated the Merger
Closing Date and signed by the Financial Officer of each of the
Borrowers, confirming compliance with the conditions set forth in this
Section 5.03.
(d) The Lenders and the Agent shall have received and determined to
be in form and substance satisfactory to them:
(i) evidence that the Merger is in compliance with all
applicable laws and regulations; and
(ii) evidence that all requisite third party consents and
waivers required to effect the Merger have been received.
(e) The Agent and the Lenders shall have:
(i) received copies (to the extent not previously delivered on
the Initial Closing Date) of amendments or supplements, if any, to
any of the Merger Documents and/or the Tender Offer Documents, each
certified by a Responsible Officer of Jitney Jungle; and
(ii) received evidence that the Merger Agreement is in full
force and effect and all consents, filings and approvals required by
applicable law in connection therewith (including, without
limitation, from state liquor authorities) shall have been obtained
and made, except as set forth on Schedule 4.03 annexed hereto.
(f) All legal matters in connection with the Merger shall be
reasonably satisfactory to the Agent, the Lenders and their respective
counsel in their sole discretion.
VI. AFFIRMATIVE COVENANTS
Each Borrower covenants and agrees with Agent and each Lender that,
so long as this Agreement shall remain in effect or the principal of or
interest on any Note, any amount under or with respect to any Letter of
Credit or any fee, expense or amount payable hereunder or in connection with
any of the Transactions shall be unpaid, it will, and will cause each
Guarantor and each of their respective subsidiaries and, with respect to
Section 6.07 hereof, each ERISA Affiliate, to:
SECTION VI.1. Legal Existence. Do or cause to be done all things
necessary to preserve, renew and keep in full force and effect its legal
existence, except for the mergers and Asset Sales permitted under Section
7.05.
SECTION VI.2. Businesses and Properties. (a) At all times do or
cause to be done all things necessary to preserve, renew and keep in full
force and effect the rights, licenses, Permits, franchises, patents,
copyrights, trademarks and trade names material to the conduct of its
businesses; (b) comply with all laws, rules, regulations and governmental
orders (whether Federal, state or local) applicable to the operation of such
businesses whether now in effect or hereafter enacted (including, without
limitation, all applicable laws, rules, regulations and governmental orders
relating to public and employee health and safety and all Environmental Laws)
and with any and all other applicable laws, rules, regulations and
governmental orders the lack of compliance with which would have a Material
Adverse Effect; (c) take all actions which may be required to obtain,
preserve, renew and extend all Permits and other authorizations which are
material to the operation of such businesses; and (d) at all times maintain,
preserve and protect all property material to the conduct of such businesses
and keep such property in good repair, working order and condition, ordinary
wear and tear excepted, and from time to time make, or cause to be made, all
needful and proper repairs, renewals, additions, improvements and
replacements thereto necessary in order that the business carried on in
connection therewith may be properly conducted at all times. Notwithstanding
the foregoing, non-compliance with clauses (a) and (c) above shall not
constitute an Event of Default unless such non-compliance is not cured within
15 days after the occurrence of such non-compliance.
SECTION VI.3. Insurance. (a) Keep its insurable properties
adequately insured at all times by financially sound and reputable insurers
with a rating of "A-" or better, as established by Best's Rating Guide (or an
equivalent rating with such other publications of a similar nature as shall
be in current use), (b) maintain such other insurance, to such extent and
against all risks, including fire and other risks insured against by extended
coverage; provided, however, that such insurance shall insure the property of
the Borrowers and their respective subsidiaries against all risk of physical
damage, including, without limitation, loss by fire, explosion, theft, fraud
and such other casualties as may be reasonably satisfactory to the Agent, but
in no event at any time in an aggregate amount less than the replacement
value of the Collateral, (c) maintain in full force and effect public
liability insurance against claims for personal injury or death or property
damage occurring upon, in, about or in connection with the use of any
properties owned, occupied or controlled by the Borrowers or any of their
respective subsidiaries, in such amount as the Agent shall reasonably deem
necessary, and (d) maintain such other insurance as may be required by law
and against loss or damage of the kinds customarily insured against by
corporations of established reputation engaged in the same or similar
businesses and similarly situated, in such type and in such amounts as is
customarily maintained under similar circumstances by such other
corporations; provided, that with respect to any insurance maintained with
respect to Collateral located at a non-warehouse location owned, occupied or
controlled by any Borrower or any of its subsidiaries, the Borrowers shall
have 15 days to cure any
non-compliance with this Section 6.03. All insurance covering tangible
personal property subject to a Lien in favor of the Agent for the benefit of
the Lenders granted pursuant to the Security Documents shall provide that, in
the case of each separate loss, the full amount of insurance proceeds shall
be payable to the Agent and shall further provide for at least 30 days' prior
written notice to the Agent of the cancellation or substantial modification
thereof. Unless a Default or an Event of Default has occurred and is
continuing, all claims with respect to the foregoing insurance shall be
settled by the Borrowers in the ordinary cause of its business.
SECTION VI.4. Taxes. Pay and discharge promptly when due all
taxes, assessments and governmental charges or levies imposed upon it or upon
its income or profits or in respect of its property before the same shall
become delinquent or in default, as well as all lawful claims for labor,
materials and supplies or otherwise, which, if unpaid, would give rise to
Liens upon such properties or any part thereof, except such taxes,
assessments and governmental charges and levies which are diligently
contested in good faith by appropriate proceedings and as to which adequate
reserves have been established in accordance with generally accepted
accounting principles.
SECTION VI.5. Financial Statements, Reports, etc. Furnish to the
Agent, with copies for each of the Lenders:
(a) within 90 days after the end of each Fiscal Year, (i)
Consolidated balance sheets and Consolidated income statements showing
the financial condition of the Borrowers and their respective
subsidiaries as of the close of such Fiscal Year and the results of their
operations during such year, and (ii) a Consolidated statement of
shareholders' equity and a Consolidated statement of cash flow, as of the
close of such Fiscal Year, all the foregoing financial statements to be
audited by a Big 6 or other independent public accountants reasonably
acceptable to the Agent (which report shall not contain any qualification
except with respect to new accounting principles mandated by the
Financial Accounting Standards Board), and to be in form and substance
reasonably acceptable to the Agent;
(b)(i) within 45 days after the end of each fiscal quarter (except
the fourth fiscal quarter), unaudited Consolidated balance sheets and
Consolidated income statements showing the financial condition and
results of operations of the Borrowers and their respective subsidiaries
as of the end of each such quarter, a Consolidated statement of
shareholders' equity and a Consolidated statement of cash flow as of the
end of each such quarter, together with a statement comparing actual
results for such quarter with the projections set forth in paragraph (f)
below, certified by the Financial Officer of Jitney Jungle as presenting
fairly the financial condition and results of operations of the Borrowers
and their respective subsidiaries and as having been prepared in
accordance with generally accepted accounting principles consistently
applied, setting forth
in each case in comparative form the corresponding figures for the
corresponding quarter of the preceding year and corresponding figures for
the period beginning with the first day of the relevant Fiscal Year and
ending on the last day of the relevant fiscal quarter and the
corresponding period for the previous Fiscal Year, in each case subject
to normal year-end audit adjustments; and (ii) within 25 days after the
end of each fiscal month, unaudited Consolidated balance sheets and
Consolidated income statements showing the financial condition and
results of operations of the Borrowers and their respective subsidiaries
as of the end of such month, a Consolidated statement of shareholders'
equity and a Consolidated statement of cash flow as of the end of each
such month, together with a statement comparing actual results for such
month with the projections set forth in (f) below, certified by the
Financial Officer of Jitney Jungle as presenting fairly the financial
condition and results of operations of the Borrowers and their respective
subsidiaries and as having been prepared in accordance with generally
accepted accounting principles consistently applied, setting forth in
each case in comparative form the corresponding figures for the
corresponding month of the preceding year and corresponding figures for
the period beginning with the first day of the current Fiscal Year and
ending on the last day of the relevant fiscal month and the corresponding
period for the previous Fiscal Year, in each case subject to normal
year-end audit adjustments;
(c) promptly after the same become publicly available, copies of
such registration statements, annual, periodic and other reports, and
such proxy statements and other information, if any, as shall be filed by
any Borrower or any of their respective subsidiaries with the SEC or any
governmental authority that may be substituted therefor, or any national
securities exchange (including, without limitation, amendments,
modifications and supplements to the Offer to Purchase and any other
Tender Offer Documents) and copies of all proxy statements submitted to
its shareholders;
(d) (i) concurrently with any delivery under (a) or (b) above, a
certificate of the firm or person referred to therein (x) which
certificate shall, in the case of the certificate of the Financial
Officer of Jitney Jungle, certify that to the best of his or her
knowledge no Default or Event of Default has occurred (including
calculations demonstrating compliance, as of the dates of the financial
statements being furnished, with the covenants set forth in Sections
7.07, 7.08, 7.09, 7.10 and 7.11 hereof and setting forth the computation
of Excess Cash Flow for the relevant period) and, if such a Default or
Event of Default has occurred, specifying the nature and extent thereof
and any corrective action taken or proposed to be taken with respect
thereto and (y) which certificate, in the case of the certificate
furnished by the independent public accountants referred in paragraph (a)
above, may be limited to accounting matters and disclaim responsibility
for legal interpretations, but shall in any event certify that
to the best of such accountants' knowledge based solely on normal audit
procedures, as of the dates of the financial statements being furnished
no Default or Event of Default has occurred under any of the covenants
set forth in Sections 7.07, 7.08, 7.09, 7.10 and 7.11 hereof (such
certificate to include calculations demonstrating compliance with such
covenants and the computation of Excess Cash Flow) and, if such a Default
or Event of Default has occurred, specifying the nature and extent
thereof and any corrective action taken or proposed to be taken with
respect thereto, and shall in addition certify that in the course of
preparing the audit and the certificate referred to herein, such
accountants have not become aware of the occurrence of any other Default
or Event of Default and, if such a Default or Event of Default has
occurred, specifying the nature thereof; provided, however, that any
certificate delivered concurrently with (a) above shall be signed by the
Financial Officer of Jitney Jungle in addition to the independent public
accountants;
(e) concurrently with any delivery under (a) above, a management
letter, if any, prepared by the independent public accountants who
reported on the financial statements delivered under (a) above, with
respect to the internal audit and financial controls of the Borrowers and
their respective subsidiaries;
(f) within 30 days after the beginning of each Fiscal Year, a
summary of business plans and financial operation projections (including,
without limitation, with respect to Excess Cash Flow and Capital
Expenditures) for the Borrowers and their respective subsidiaries for
such Fiscal Year (including fiscal month balance sheets, statements of
income and of cash flow, an Undrawn Availability forecast, an Excess Cash
Flow forecast and a forecast as to compliance with the covenants
contained in Sections 7.07, 7.08, 7.09, 7.10 and 7.11 hereof), prepared
by management and in form, substance and detail (including, without
limitation, principal assumptions) reasonably satisfactory to the Agent;
(g) (i) no later than 14 days after the end of each fiscal month,
a certificate, in form, substance and detail reasonably satisfactory to
the Agent, in substantially the form annexed hereto as Exhibit K-1, of
the Financial Officer of each of the Borrowers on a consolidated and
consolidating basis with respect to Jitney Jungle and on a consolidating
basis with respect to each other Borrower, demonstrating compliance as at
the close of business on the last Saturday of such fiscal month with the
Borrowing Base of the Borrowers (including particulars as to the Loans
made and the Letters of Credit Usage during such month with respect to
each of the Borrowers), together with a reconciliation of all collections
made with respect to the Borrowers and the Guarantors during such fiscal
month, on a consolidated and an individual basis and (ii) no later than
Monday of each week, a certificate in form, substance and detail
reasonably satisfactory to the Agent, in substantially the form annexed
hereto as Exhibit K-2,
of the Financial Officer of each of the Borrowers on a consolidated and
consolidating basis with respect to Jitney Jungle and on a consolidating
basis with respect to each other Borrower (including, without limitation,
the amount of inventory held by such Borrower), demonstrating compliance
as at the close of business on Saturday of the preceding week with the
individual Borrowing Base of such Borrower;
(h) promptly upon the request of the Agent, a certificate, in form,
substance and detail reasonably satisfactory to the Agent, of the
Financial Officer of (i) each of the Borrowers demonstrating compliance
with the individual Borrowing Base of such Borrower as at such previous
date as Agent shall reasonably request, together with a reconciliation of
all collections made with respect to the Borrowers and the Guarantors
since the date of the most recent reconciliation delivered to the Agent
under this clause (h) or clause (g) above through such date and (ii)
Jitney Jungle on a consolidated basis demonstrating compliance with the
Borrowing Base of the Borrowers as at such previous date as Agent shall
reasonably request;
(i) immediately upon becoming aware thereof, notice to the Agent of
the breach beyond any applicable grace period by any party of any
material agreement with any Borrower, any Guarantor or any of their
respective subsidiaries; and
(j) such other information as the Agent or any Lender may
reasonably request, including, without limitation, profit and loss
information on a store by store basis, as well as supplemental expense
information. At the reasonable request of any Lender, the Agent agrees
to promptly forward such request for information to the Borrowers.
SECTION VI.6. Litigation and Other Notices. Give the Agent prompt
written notice of the following:
(a) the issuance by any court or governmental agency or authority
of any injunction, order, decision or other restraint prohibiting, or
having the effect of prohibiting, the making of the Loans or occurrence
of other Credit Events, or invalidating, or having the effect of
invalidating, any provision of this Agreement, the Notes or the other
Loan Documents, or the initiation of any litigation or similar proceeding
seeking any such injunction, order, decision or other restraint;
(b) the filing or commencement of any action, suit or proceeding
against any Borrower, any Guarantor or any of their respective
subsidiaries, whether at law or in equity or by or before any court or
any Federal, state, municipal or other governmental agency or authority,
(i) which is material and is brought by or on behalf of any governmental
agency or authority, or in which
injunctive or other equitable relief is sought or (ii) as to which it is
probable (within the meaning of Statement of Financial Accounting
Standards No. 5) that there will be an adverse determination and which,
if adversely determined, would (A) reasonably be expected to result in
liability of any Borrower, any Guarantor or any of their respective
subsidiaries thereof in an aggregate amount of $500,000 or more, not
reimbursable by insurance, or (B) materially impair the right of any
Borrower, any Guarantor or any of their respective subsidiaries to
perform its obligations under this Agreement, any Note or any other Loan
Document to which it is a party;
(c) any Default or Event of Default or any "Default" or "Event of
Default" under the Senior Indenture (as such terms are defined in the
Senior Indenture) or the Senior Subordinated Indenture (as such terms are
defined in the Senior Subordinated Indenture), specifying the nature and
extent thereof and the action (if any) which is proposed to be taken with
respect thereto;
(d) upon the issuance, mailing or delivery thereof, (i) copies of
notice of any redemption or other payment of the Senior Notes under the
Senior Indenture or the Senior Subordinated Notes under the Senior
Subordinated Indenture and copies of any written information,
correspondence or communication under the Senior Indenture or the Senior
Subordinated Indenture or with respect to the Senior Notes or the Senior
Subordinated Notes not otherwise required to be delivered to the Agent or
the Lenders hereunder; and (ii) copies of notice of any redemption,
exchange or other payment with respect to any preferred stock of the
Borrowers; provided, that this clause (d) shall not constitute the
consent of the Agent or any Lender to any such redemption, exchange or
other payment; and
(e) any development in the business or affairs of any Borrower, any
Guarantor or any of their respective subsidiaries which has had or which
is likely, in the reasonable judgment of any Responsible Officer of any
Borrower, to have, a Material Adverse Effect (including, without
limitation, any actual or threatened strike, work stoppage or other labor
action, whether or not authorized by labor unions).
SECTION VI.7. ERISA. (a) Pay and discharge promptly any
liability imposed upon it pursuant to the provisions of Title IV of ERISA;
provided, however, that neither any Borrower nor any ERISA Affiliate thereof
shall be required to pay any such liability if (1) the amount, applicability
or validity thereof shall be diligently contested in good faith by
appropriate proceedings, and (2) such person shall have set aside on its
books reserves which are required by generally accepted accounting
principles consistently applied.
(b) Deliver to the Agent, promptly, and in any event within 30
days, after
(i) the occurrence of any Reportable Event, a copy of the materials
that are filed with the PBGC, (ii) any Borrower or any ERISA Affiliate
thereof or an administrator of any Pension Plan files with participants,
beneficiaries or the PBGC a notice of intent to terminate any such Plan,
a copy of any such notice, (iii) the receipt of notice by any Borrower or
any ERISA Affiliate thereof or an administrator of any Pension Plan from
the PBGC of the PBGC's intention to terminate any Pension Plan or to
appoint a trustee to administer any such Plan, a copy of such notice,
(iv) the filing thereof with the Internal Revenue Service, copies of each
annual report that is filed on Treasury Form 5500 with respect to any
Plan, together with certified financial statements (if any) for the Plan
and any actuarial statements on Schedule B to such Form 5500, (v) any
Borrower or any ERISA Affiliate thereof knows or has reason to know of
any event or condition which might constitute grounds under the
provisions of Section 4042 of ERISA for the termination of (or the
appointment of a trustee to administer) any Pension Plan, an explanation
of such event or condition, (vi) the receipt by any Borrower or any ERISA
Affiliate thereof of an assessment of withdrawal liability under Section
4201 of ERISA from a Multiemployer Plan, or any other notice from such
Multiemployer Plan of any action or event involving or in connection with
insolvency, reorganization or termination (each as defined in ERISA) a
copy of such assessment, or notice, (vii) any Borrower or any ERISA
Affiliate thereof knows or has reason to know of any event or condition
which might cause any one of them to incur a liability under Section
4062, 4063, 4064 or 4069 of ERISA or Section 412(n) or 4971 of the Code,
an explanation of such event or condition, and (viii) any Borrower or any
ERISA Affiliate thereof knows or has reason to know that an application
is to be, or has been, made to the Secretary of the Treasury for a waiver
of the minimum funding standard under the provisions of Section 412 of
the Code, a copy of such application, and in each case described in
clauses (i) through (iii) and (v) through (vii) together with a statement
signed by the Financial Officer of such Borrower setting forth details as
to such Reportable Event, notice, event or condition and the action which
such Borrower or such ERISA Affiliate thereof proposes to take with
respect thereto which, whether individually or in the aggregate, would
cause a Material Adverse Effect.
(c) Within 30 days after the end of any fiscal quarter in which any
Borrower becomes aware, directly or indirectly, of any fact or
information that materially changes the status of such Borrower with
respect to the Multiemployer Plans, give notice thereof to the Agent.
SECTION VI.8. Maintaining Records; Access to Properties and
Inspections; Right to Audit. Maintain financial records in accordance with
accepted financial practices and, upon reasonable notice (which may be
telephonic), at all reasonable times and as often as any Agent may request,
permit any authorized representative designated by such Agent to visit and
inspect the properties and financial records of each of the Borrowers and
their respective subsidiaries and to make extracts from such financial
records, at the Borrowers' cost and expense, and permit any authorized
representative designated by such Agent to discuss the affairs,
finances and condition of each of the Borrowers and their respective
subsidiaries with the appropriate Financial Officer and such other officers
as such Agent shall deem appropriate and the Borrowers' independent public
accountants, as applicable. An authorized representative of each of the
Lenders may accompany the Agent on such visits and inspections (and during
such visit or inspection, discuss the affairs, finances and condition of each
of the Borrowers and their respective subsidiaries with the appropriate
Financial Officer, such other officer or the Borrowers' independent public
accountants, as applicable). The Agent shall have the right to audit, as
often as it may request, the existence and condition of the inventory, books
and records of the Borrowers and their respective subsidiaries and to review
their compliance with the terms and conditions of this Agreement and the
other Loan Documents. The Borrowers shall pay Agent's customary per diem
rates, all out-of-pocket expenses of Agent's auditors and all costs of Agent
with respect to third-party examiners, but at all times prior to a Default or
Event of Default, the obligations of the Borrowers with respect to this
sentence shall be limited to $50,000 per calendar year.
SECTION VI.9. Fiscal Year-End. Cause its Fiscal Year to end on the
Saturday nearest to April 30 of each year.
SECTION VI.10. Further Assurances. Promptly execute any and all
further documents and take all further actions which may be required under
applicable law, or which the Agent may reasonably request, to grant,
preserve, protect and perfect the first priority security interest created by
the Security Documents in the Collateral.
SECTION VI.11. Additional Grantors and Guarantors. Promptly inform
the Agent of the creation or acquisition of any direct or indirect subsidiary
(subject to the provisions of Section 7.05 hereof) and cause each direct or
indirect subsidiary not in existence on the date hereof to become a Guarantor
hereunder pursuant to an agreement in form and substance reasonably
satisfactory to the Agent, and to execute the Security Documents, as
applicable, as a Grantor, and cause the direct parent of each such subsidiary
to pledge all of the capital stock of such subsidiary pursuant to the Pledge
Agreement and cause each such subsidiary to pledge its inventory and all
other owned assets pursuant to the Security Agreement.
SECTION VI.12. Environmental Laws. (a) Comply, and cause each of
its subsidiaries to comply, in all material respects with the provisions of
all Environmental Laws, and shall keep the properties which it and its
subsidiaries own free of any Lien imposed pursuant to any Environmental Law,
except where such Liens are being contested in good faith by appropriate
proceedings in accordance with applicable law, and, with respect to any
properties it or any of its subsidiaries occupies but does not own, it or its
subsidiaries shall not conduct any activities or allow any condition to
remain which would reasonably be expected to cause the imposition of any Lien
under any Environmental Law. Each Borrower and each Guarantor shall not cause
or suffer or permit, and shall not suffer or permit any of their respective
subsidiaries to cause or suffer or permit, the property of such Borrower,
such Guarantor or their respective subsidiaries to be used for the use,
generation, production, processing, handling, storage, transporting or
disposal of any Hazardous Material, except for the use, generation, handling,
storage or transportation of fuel, raw materials and inventory held or
generated in the ordinary course of operating its business, refrigerants,
wastes and routine cleaning and maintenance products.
(b) Supply to the Agent copies of all material submissions by each
Borrower, each Guarantor or any of their respective subsidiaries to any
governmental body and of the final reports of all environmental audits and of
all other environmental tests, studies or assessments (including the data
derived from any sampling or survey of asbestos, soil, or subsurface or other
materials or conditions) that may be conducted or performed (by or on behalf
of such Borrower, such Guarantor or any of their respective subsidiaries) on
or regarding the properties owned, operated, leased or occupied by such
Borrower, such Guarantor or any of their respective subsidiaries or regarding
any conditions that might have been affected by Hazardous Materials on or
Released or removed from such properties. Each Borrower and each Guarantor
shall also permit and authorize, and shall cause its subsidiaries to permit
and authorize, the consultants or other persons that prepare such submissions
or reports or perform such audits, tests, studies or assessments to discuss
such submissions, reports or audits with the Agent and the Lenders; provided,
that attorneys for such Borrower, such Guarantor or such subsidiary or such
consultants or other persons shall be entitled to participate in such
discussions.
(c) Promptly (and in no event more than ten Business Days after the
applicable Borrower or the applicable Guarantor becomes aware or is otherwise
informed of such event) provide written notice to the Agent upon the
happening of any of the following:
(i) such Borrower, such Guarantor or any of their respective
subsidiaries, or any tenant or other occupant of any property of
such Borrower, such Guarantor or any of their respective
subsidiaries receives written notice of any claim, complaint, charge
or notice of a violation or potential violation of any Environmental
Law;
(ii) there has been a Release of Hazardous Materials upon,
under or about or affecting any of the properties owned, operated,
leased or occupied by such Borrower, such Guarantor or any of their
respective subsidiaries, or Hazardous Materials at levels or in
amounts that may have to be reported, remedied or responded to under
Environmental Law are detected on or in the soil or groundwater;
(iii) such Borrower, such Guarantor or any of their respective
subsidiaries is or may be liable for any material costs of cleaning
up or otherwise responding to a Release of Hazardous Materials;
(iv) any part of the properties owned, operated, leased or
occupied by such Borrower, such Guarantor or any of their respective
subsidiaries is or may be subject to a Lien under any Environmental
Law; or
(v) such Borrower, such Guarantor or any of their respective
subsidiaries undertakes any material Remedial Work with respect to
any Hazardous Materials.
(d) Timely undertake and complete any Remedial Work required to be
undertaken by such Borrower or such Guarantor by any Environmental Law,
except to the extent that such requirement is being diligently contested in
good faith by appropriate proceedings in accordance with applicable law.
(e) Without in any way limiting the scope of Section 11.04(c) and
in addition to any obligations thereunder, each Borrower hereby indemnifies
and agrees to hold the Agent and the Lenders harmless from and against any
liability, loss, damage, suit, action or proceeding arising out of its
business or the business of its subsidiaries pertaining to Hazardous
Materials, including, but not limited to, claims of any governmental body or
any third person arising under any Environmental Law or under tort, contract
or common law, except for any liability, loss, damage, suit or proceeding to
the extent that it results from the gross negligence, bad faith or willful
misconduct of the Agent or any Lender. To the extent laws of the United
States or any state or local jurisdiction in which property owned, operated,
leased or occupied by any Borrower, any Guarantor or any of their respective
subsidiaries is located provide that a Lien upon such property of such
Borrower, such Guarantor or such subsidiary may be obtained for the costs of
removal by a governmental body of Hazardous Materials which have been
Released and a Release has occurred with respect to which such Borrower, such
Guarantor or such subsidiary is required to provide notice to the Agent
pursuant to Section 6.12(c), no later than ninety days after notice is given
by the Agent to such Borrower, such Guarantor or such subsidiary, such
Borrower, such Guarantor or such subsidiary shall deliver to the Agent a
report issued by a qualified third party engineer providing an assessment of
such Hazardous Materials which were Released upon or beneath the specified
property. To the extent any Hazardous Materials located therein or
thereunder either subject the property to a Lien or require a response
pursuant to any applicable Environmental Laws, the response specified in
Section 6.12(f) shall be an affirmative covenant of the Borrowers hereunder.
(f) In the event that any Remedial Work is required to be performed
by any Borrower, any Guarantor or any of their respective subsidiaries under
any applicable Environmental Law, any judicial order, or by any governmental
entity, such Borrower, such Guarantor or such subsidiaries shall commence all
such Remedial Work at or prior to the time required therefor under such
Environmental Law or
applicable judicial orders and thereafter diligently prosecute to completion
all such Remedial Work in accordance with and within the time allowed under
such applicable Environmental Laws or judicial orders, except to the extent
that such requirement is being diligently contested in good faith by
appropriate proceedings in accordance with applicable law.
SECTION VI.13. Pay Obligations to Lenders and Perform Other
Covenants. (a) Make full and timely payment of the Obligations, whether now
existing or hereafter arising, (b) duly comply with all the terms and
covenants contained in this Agreement (including, without limitation, the
borrowing limitations and mandatory prepayments in accordance with Article II
hereof) in each of the other Loan Documents, all at the times and places and
in the manner set forth therein, and (c) except for the filing of
continuation statements and the making of other filings by the Agent as
secured party or assignee, at all times take all actions necessary to
maintain the Liens and security interests provided for under or pursuant to
this Agreement and the Security Documents as valid and perfected first Liens
on the property intended to be covered thereby (subject only to Liens
expressly permitted hereunder) and supply all requested information to the
Agent necessary for such maintenance.
SECTION VI.14. Maintain Operating Accounts. Maintain its principal
disbursement accounts, operating accounts and other depository accounts as
set forth on Schedule 4.14 annexed hereto or as otherwise contemplated by
Section 10.01, and notify the Agent promptly of the closing of any account
specified in Schedule 4.14 annexed hereto and the opening up of any new
accounts, in detail satisfactory to the Agent and with respect to any such
new account, provide the Agent with such agreements, in form and substance
satisfactory to the Agent, as the Agent shall request.
SECTION VI.15. Amendments. Promptly supply to the Agent certified
copies of any amendments to the Original Acquisition Documents, the Merger
Documents, the Tender Offer Documents, the Capitalization Documents, the
Senior Indenture, the Senior Notes, the Senior Subordinated Indenture, the
Senior Subordinated Notes or any Subordinated Indebtedness (subject to
Section 7.18 hereof).
SECTION VI.16. Use of Proceeds. Use all proceeds of the initial
borrowing under the Commitment to refinance the outstanding Indebtedness
under the Existing Credit Agreement on the Initial Closing Date, to
consummate the Related Transactions, to refinance the outstanding Target
Indebtedness on the Initial Closing Date and use all proceeds of each
borrowing under the Commitment thereafter to provide for working capital
requirements and the general corporate purposes of the Borrowers to the
extent that such purposes are permitted hereunder.
SECTION VI.17. Voting Control of Target Company; No Sale of Stock,
Etc. At all times from and after the Initial Closing Date to but not
including the Merger Closing Date, own at least the Minimum Percentage of the
outstanding shares of capital stock of the Target Company. From and after
the Initial Closing Date, none of the Borrowers, the Guarantors or any of
their respective subsidiaries will sell, assign, transfer, convey or encumber
any Target Stock except in accordance with the terms of the Pledge Agreement.
SECTION VI.18. Merger. Use its best efforts to cause the Merger to
be consummated as promptly as practical but in no event later than the 180th
day from the Initial Closing Date.
VII. NEGATIVE COVENANTS
Each Borrower covenants and agrees with Agent and each Lender that,
so long as this Agreement shall remain in effect or the principal of or
interest on any Note, any amount under or with respect to any Letter of
Credit, or any fee, expense or amount payable hereunder or in connection with
any of the Transactions shall be unpaid, it will not and will not cause or
permit any Guarantor or any of their respective subsidiaries and, in the case
of Section 7.16 hereof, any ERISA Affiliate thereof to, either directly or
indirectly:
SECTION VII.1. Liens. Incur, create, assume or permit to exist any
Lien on any of its property or assets (including the stock of any direct or
indirect subsidiary), whether owned at the date hereof or hereafter acquired,
or assign or convey any rights to or security interests in any future
revenues, except:
(a) Liens incurred and pledges and deposits made in the ordinary
course of business in connection with workers' compensation, unemployment
insurance, old-age pensions and other social security benefits (not
including any lien described in Section 412(m) of the Code);
(b) Liens imposed by law, such as landlord, carriers',
warehousemen's, mechanics', materialmen's and vendors' liens and other
similar liens, incurred in good faith in the ordinary course of business
and securing obligations which are not overdue or which are being
contested in good faith by appropriate proceedings as to which the
applicable Borrower or any of its subsidiaries, as the case may be,
shall, to the extent required by generally accepted accounting principles
consistently applied, have set aside on its books adequate reserves;
(c) Liens securing the payment of taxes, assessments and
governmental charges or levies, that are not delinquent or are being
diligently contested in good faith by appropriate proceedings and as to
which adequate
reserves have been established in accordance with generally accepted
accounting principles; provided, however, that in no event shall the
aggregate amount of such reserves be less than the aggregate amount
secured by such Liens;
(d) zoning restrictions, easements, licenses, reservations,
provisions, covenants, conditions, waivers, restrictions on the use of
real property or minor irregularities of title (and with respect to
leasehold interests, mortgages, obligations, liens and other encumbrances
incurred, created, assumed or permitted to exist and arising by, through
or under a landlord, ground lessor or owner of the leased property, with
or without consent of the lessee) which do not in the aggregate
materially detract from the value of its property or assets or materially
impair the use thereof in the operation of its business or with respect
to leasehold interests permitted to exist under any Mortgage, as
permitted by such Mortgage or with respect to leasehold interests on real
property not subject to any Mortgage, of the types permitted by, and
containing the same general terms and limitations of, any of the
Mortgages delivered on the Original Closing Date;
(e) Liens upon any equipment acquired through the purchase or lease
by any Borrower or any of its subsidiaries which are created or incurred
by such Borrower as a condition to the financing of such acquisition to
secure or provide for the payment of any part of the purchase price of,
or lease payments on, such equipment (but no other amounts and not in
excess of the purchase price or lease payments); provided, however, that
any such Lien shall not apply to any other property of such Borrower or
any of its subsidiaries; and provided, further, that after giving effect
to such purchase or lease, compliance is maintained with Section 7.07
hereof;
(f) Liens created in favor of the Letter of Credit Issuer for the
benefit of the Secured Parties with respect to Letters of Credit;
(g) Liens existing on the date of this Agreement and set forth in
Schedule 7.01 annexed hereto or set forth in Schedule B to each of the
title policies referred to in Section 3.03 hereof;
(h) Liens created in favor of the Agent for the benefit of the
Secured Parties (including, without limitation, Liens securing interest
rate protection agreements and other similar arrangements entered into
with Fleet);
(i) Liens securing the performance of bids, tenders, leases,
contracts (other than for the repayment of borrowed money), statutory
obligations, surety, customs and appeal bonds and other obligations of
like nature, incurred as an incident to and in the ordinary course of
business;
(j) Liens for judgments which would not result in an Event of Default
under Article VIII (l);
(k) Liens in respect of Capitalized Lease Obligations;
(l) Liens in favor of A.I. Credit Corp. securing payment of amounts
due under a Premium Finance Agreement, Disclosure Statement and Security
Agreement dated as of May 29, 1997; provided, however, that compliance is
maintained with Section 7.03(xii) hereof; or
(m) Liens on property in connection with transactions permitted
pursuant to Section 7.02 hereof.
SECTION VII.2. Sale and Lease-Back Transactions. Enter into any
arrangement, directly or indirectly, with any person whereby any Borrower,
any Guarantor or any of their respective subsidiaries shall sell or transfer
any property, real or personal, and used or useful in its business, whether
now owned or hereafter acquired, and thereafter rent or lease such property
or other property which such Borrower, such Guarantor or such subsidiary
intends to use for substantially the same purpose or purposes as the property
being sold or transferred, except that so long as no Default or Event of
Default exists at such time or immediately after giving effect thereto, upon
thirty (30) days' prior written notice by the Borrowers to the Agent, the
Borrowers may enter into such arrangements with respect to real property with
the prior written consent of the Agent and the Required Lenders (such consent
not to be unreasonably withheld).
SECTION VII.3. Indebtedness. Incur, create, assume or permit to
exist any Indebtedness other than (i) Indebtedness (including, without
limitation, Capitalized Lease Obligations) secured by Liens permitted under
Section 7.01, (ii) Indebtedness (including, without limitation, Guarantees)
existing on the date hereof and listed in Schedule 7.03 annexed hereto, but
(except for extensions or renewals of the IRB Indebtedness) not the increase,
extension, renewal or refunding thereof, (iii) Indebtedness incurred
hereunder and under the other Loan Documents, (iv) Indebtedness incurred with
respect to interest rate protection agreements and other similar arrangements
entered into with Fleet, (v) Guarantees constituting the endorsement of
negotiable instruments for deposit or collection in the ordinary course of
business, (vi) Guarantees of the Obligations, (vii) Indebtedness under the
Senior Indenture or the Senior Notes, but not the increase, extension,
renewal or refunding thereof, (viii) Indebtedness under the Senior
Subordinated Indenture, but not the increase, extension, renewal or refunding
thereof, (ix) other Subordinated Indebtedness, but not the increase,
extension, renewal or refunding thereof, (x) Indebtedness to trade creditors
incurred in the ordinary course of business, (xi) Intercompany Indebtedness,
(xii) Indebtedness to A.I. Credit Corp. incurred in connection with a Premium
Finance Agreement, Disclosure Statement and Security Agreement dated as of
May 29, 1997 in a maximum amount of $16,000,000, (xiii) Indebtedness with
respect to
unsecured letters of credit not issued under this Agreement in a maximum
amount of $5,000,000, plus any amount by which the maximum amount of Letters
of Credit under this Agreement (presently $30,000,000) is permanently
reduced, and (xiv) Indebtedness permitted to be incurred under Section 7.02
hereof.
SECTION VII.4. Dividends, Distributions and Payments. Declare or
pay, directly and indirectly, any cash dividends or make any other
distribution, whether in cash, property, securities (other than
payment-in-kind payments or non-cash accretions to liquidation preference
made with respect to any preferred stock of Jitney Jungle) or a combination
thereof, with respect to (whether by reduction of capital or otherwise) any
shares of its capital stock or directly or indirectly redeem, purchase,
retire or otherwise acquire for value (or permit any subsidiary to purchase
or acquire) any shares of any class of its capital stock or set aside any
amount for any such purpose, other than (i) the issuance of warrants to
purchase up to 15%, on a fully diluted basis, of the common stock of Jitney
Jungle and (ii) dividends or other distributions by any subsidiary of Jitney
Jungle to Jitney Jungle or a subsidiary thereof and purchases by Jitney
Jungle of the capital stock of Jitney Jungle from retiring employees of the
Borrowers pursuant to the Securities Purchase and Holders Agreement in an
aggregate amount for all such employees not in excess of $1,000,000 during
the term of this Agreement (as such amount may from time to time be reduced
by purchases of such capital stock by Jitney Jungle from such employees and
increased by any sales by Jitney Jungle of such capital stock to other
employees; provided, that such purchased capital stock shall be sold within
180 days of such purchase to one or more employees of the Borrowers for a
cash consideration equal to or greater than the consideration paid by Jitney
Jungle for such capital stock).
SECTION VII.5. Consolidations, Merger and Sales of Assets.
Consolidate with or merge into any other person, or sell, lease, transfer or
assign to any persons or otherwise dispose of (whether in one transaction or
a series of transactions) any portion of its assets (whether now owned or
hereafter acquired), or permit another person to merge into it, or acquire
all or substantially all the capital stock or assets of any other person,
except that (i) the Borrowers and their respective subsidiaries may sell any
of their inventory in the ordinary course of their business; (ii) the
Borrowers and their respective subsidiaries may consummate the Related
Transactions; (iii) the Borrowers may sell automobiles used by employees in a
manner consistent with the Borrowers' past practices; (iv) any Borrower may
sell obsolete equipment in the ordinary course of business; provided, that
the Net Cash Proceeds of any such sale are applied to repay the Loans to the
extent required by Section 2.09(d)(i); (v) any Borrower (other than
Acquisition Corp. or Jitney Jungle) or Guarantor (other than Acquisition
Corp. or Jitney Jungle) may merge into any other Borrower or Guarantor; (vi)
the Borrowers and their respective subsidiaries may sell assets (other than
inventory or as otherwise permitted hereby) that constitute properties of any
Borrower or any subsidiary thereof no longer necessary for the proper conduct
of their respective businesses, for fair consideration and having a sales
price of not greater than
$1,000,000 in any single transaction; provided, that the aggregate sales
price of all assets permitted to be sold pursuant to this clause (vi) shall
not exceed $5,000,000 during the term of this Agreement; and provided;
further that the Net Cash Proceeds of any such sale are applied to repay the
Loans to the extent required by Section 2.09(d)(i); (vii) the Borrowers and
their respective subsidiaries may lease or sublease real property covered by
a Mortgage in the ordinary course of business, such lease or sublease to be
for an initial term of up to seven and one-half years; provided, that the
real property covered by any such lease or sublease shall not exceed 5,000
square feet.; (viii) the Borrowers and their respective subsidiaries may sell
assets permitted to be sold by Section 7.02 hereof; (ix) the Borrowers and
their respective subsidiaries may sell the FTC Divestiture Stores; and (x)
Acquisition Corp. may merge with and into the Target Company on the Merger
Closing Date.
SECTION VII.6. Investments. Own, purchase or acquire any stock,
obligations, assets or securities of, or any interest in, or make any capital
contribution or loan or advance to, any other person, or make any other
investments, except:
(a) certificates of deposit in dollars of any commercial banks
registered to do business in any state of the United States (i) having
capital and surplus in excess of $1,000,000,000 and (ii) whose long-term
debt rating is at least investment grade as determined by either Standard
& Poor's Ratings Services, a division of McGraw Hill, Inc. ("S&P") or
Xxxxx'x Investors Service, Inc. ("Moody's");
(b) readily marketable direct obligations of the United States
government or any agency thereof which are backed by the full faith and
credit of the United States;
(c) commercial paper at the time of acquisition having the highest
rating obtainable from either S&P or Moody's;
(d) federally tax exempt securities rated A or better by either S&P
or Moody's;
(e) investments in the stock of any subsidiary existing on the
Initial Closing Date, but not any additional investments therein;
(f) loans to employees in connection with the purchase of capital
stock of the Borrowers and/or for other purposes not in excess of $750,000
in the aggregate outstanding at any time for all loans under this clause
(f);
(g) so long as no Default or Event of Default shall exist at the
time of acquisition (or after giving effect thereto) and subject to
Section 7.13, acquisitions by any Borrower or any subsidiary thereof of
assets of a business of
a non-Affiliated person not to exceed in purchase price (whether in the form
of cash, property, stock, Indebtedness, assumption of liabilities or
otherwise) $1,000,000 individually or $5,000,000 in the aggregate for all
such acquisitions during the term of this Agreement;
(h) acquisitions of new stores for the conduct of the Borrowers'
business to the extent permitted under this Agreement;
(i) Intercompany Loans; and
(j) investments in the Target Stock;
provided, that, in each case mentioned in (a), (b), (c) and (d) above, such
obligations shall mature not more than one year from the date of acquisition
thereof; provided, further, that Loans may not be used to purchase or
otherwise fund the investments described in clauses (a) through and including
(d) above.
SECTION VII.7. Capital Expenditures and Other Expenditures. Permit
the aggregate amount of payments made, without duplication, for Capital
Expenditures, Capitalized Lease Obligations and Indebtedness secured by Liens
permitted under Section 7.01(e) and/or Section 7.01(k) hereof (excluding
Capital Expenditures in respect of Reinvestment Assets to the extent funded
with the Net Cash Proceeds of Asset Sales), at the end of each fiscal
quarter, for the four most recent consecutive fiscal quarters of the
Borrowers and their respective Consolidated subsidiaries to exceed 50% of
EBITDA for such fiscal period.
SECTION VII.8. Fixed Charge Coverage Ratio. If Undrawn
Availability at any time (each, a "Fixed Charge Test Date") is less than
$22,500,000, permit the Fixed Charge Coverage Ratio at the end of each fiscal
quarter, commencing with the fiscal quarter following the fiscal quarter in
which such Fixed Charge Test Date occurred, to be less than 1.00:1.00.
SECTION VII.9. Leverage Ratio. Permit the Leverage Ratio at the
end of each fiscal quarter set forth below to be greater than:
Date of Determination Ratio
--------------------- ------
Each Fiscal Quarter ending 5.00:1.00
in Fiscal Year 1998
Each Fiscal Quarter ending 4.40:1.00
in Fiscal Year 1999
Each Fiscal Quarter ending 4.30:1.00
in Fiscal Year 2000
Each Fiscal Quarter ending 3.90:1.00
in Fiscal Year 2001
Each Fiscal Quarter ending 3.60:1.00
in Fiscal Year 2002
Each Fiscal Quarter ending 3.40:1.00
in Fiscal Year 2003
SECTION VII.10. Interest Coverage Ratio. Permit the Interest
Coverage Ratio at the end of each fiscal quarter set forth below to be less
than:
Date of Determination Ratio
--------------------- ------
Each Fiscal Quarter ending 1.65:1.00
in Fiscal Year 1998
Each Fiscal Quarter ending 1.80:1.00
in Fiscal Year 1999
Each Fiscal Quarter ending 1.85:1.00
in Fiscal Year 2000
Each Fiscal Quarter ending 2.00:1.00
in Fiscal Year 2001 and
thereafter
SECTION VII.11. EBITDA. Permit EBITDA at the end of each fiscal
quarter for the four most recent consecutive fiscal quarters ending on or
prior to the date of determination to be less than the following amounts;
provided, that for the fiscal quarters ending October 18, 1997, January 10,
1998 and May 2, 1998, EBITDA shall be calculated, with respect to Jitney
Jungle and its subsidiaries (other than Delchamps and its subsidiaries), for
the number of fiscal quarters that shall have elapsed since May 3, 1997 and
with respect to Delchamps and its subsidiaries, for the period commencing
June 29, 1997 through the date of determination:
Date of Determination Ratio
--------------------- ------
Fiscal Quarter ending $38,000,000
October 18, 1997
Fiscal Quarter ending $59,000,000
January 10, 1998
Fiscal Quarter ending $90,000,000
May 2, 1998
Each Fiscal Quarter ending $112,000,000
in Fiscal Year 1999
Each Fiscal Quarter ending $114,000,000
in Fiscal Year 2000
Each Fiscal Quarter ending $124,000,000
in Fiscal Year 2001
Each Fiscal Quarter ending $135,000,000
in Fiscal Year 2002
Each Fiscal Quarter ending $148,000,000
in Fiscal Year 2003
SECTION VII.12. Interest Rate Protection Arrangements. Enter into
any interest rate protection agreement, interest rate swap agreement, hedge
contract or any other agreement, arrangement, device or instrument designed
or intended to protect the applicable Borrower against fluctuations in the
rate of interest on its Indebtedness with any person other than Fleet or an
Affiliate thereof (subject to market competition).
SECTION VII.13. Business. Alter the nature of its business as
operated on the date of this Agreement in any material respect.
SECTION VII.14. Sales of Receivables. Sell, assign, discount,
transfer, or otherwise dispose of any accounts receivable, promissory notes,
drafts or trade acceptances or other rights to receive payment held by it,
with or without recourse, except for the purpose of collection or settlement
in the ordinary course of business.
SECTION VII.15. Use of Proceeds. Permit the proceeds of any Credit
Event to be used for any purpose which entails a violation of, or is
inconsistent with, Regulation G, T, U or X of the Board, or for any purpose
other than those set forth in Section 6.16 hereof.
SECTION VII.16. ERISA. (a) Engage in any transaction in
connection with which any Borrower or any ERISA Affiliate thereof could be
subject to either a material civil penalty assessed pursuant to the
provisions of Section 502 of ERISA or a material tax imposed under the
provisions of Section 4975 of the Code.
(b) Terminate any Pension Plan in a "distress termination" under
Section 4041 of ERISA which could result in a material liability of any
Borrower or any ERISA Affiliate thereof to the PBGC, or take any other action
which could result in a material liability of any Borrower or any ERISA
Affiliate thereof to the PBGC.
(c) Fail to make payment when due of all amounts which, under the
provisions of any Plan, any Borrower or any ERISA Affiliate thereof is
required to pay as contributions thereto (other than a failure by reason of
inadvertent error that is corrected as soon as practicable after discovery of
such error if the effect of such failure would reasonably be expected to
result in a Material Adverse Effect), or, with respect to any Pension Plan,
permit to exist any "accumulated funding deficiency" (within the meaning of
Section 302 of ERISA and Section 412 of the Code), whether or not waived,
with respect thereto.
(d) Adopt an amendment to any Pension Plan requiring the provision
of security under Section 307 of ERISA or Section 401(a)(29) of the Code.
SECTION VII.17. Accounting Changes. Make, or permit any subsidiary
to make, any material change in its accounting treatment or financial
reporting practices except as required or permitted by generally accepted
accounting principles in effect from time to time.
SECTION VII.18. Prepayment or Modification of Indebtedness;
Modification of Charter and Other Documents. (a) Directly or indirectly
prepay, redeem, purchase, defease or retire in advance of its scheduled
maturity any Indebtedness (for borrowed money or under capital leases) other
than (i) Indebtedness incurred hereunder, (ii) Indebtedness in respect of
Capitalized Lease Obligations relating to real property, (iii) Indebtedness
in respect of Capitalized Lease Obligations relating to personal property
(such prepayments, redemptions, purchases or retirements under this clause
(iii) not to exceed $2,500,000 in the aggregate during the term of this
Agreement), or pay any Indebtedness in violation of any subordination
provisions with respect thereto, or (iv) Indebtedness under certain insurance
policies maintained with Aon Risk Services with respect to the premiums
payable under such policies, as contemplated by the financing arrangements
with A.I. Credit Corp. pursuant to a Premium Finance Agreement, Disclosure
Statement and Security Agreement dated as of May 29, 1997.
(b) Directly or indirectly prepay, redeem, purchase, decrease or
retire in advance of its scheduled maturity any Indebtedness issued under the
Senior Indenture, the Senior Subordinated Indenture or any of the Senior
Notes or the Senior Subordinated Notes or any Subordinated Indebtedness.
(c) Directly or indirectly modify, amend or otherwise alter the
terms and provisions of the Senior Indenture or the Senior Notes or of the
Senior Subordinated Indenture or the Senior Subordinated Notes or any
Subordinated Indebtedness.
(d) Directly or indirectly modify, amend or alter their
certificates or articles of incorporation (except in connection with
issuances of capital stock permitted by Section 7.23(iv)), preferred
stock/certificates of designations or by-laws.
(e) Directly or indirectly modify, amend or otherwise alter the
terms and provisions of any of the Original Acquisition Documents, the Merger
Documents, the Tender Offer Documents or the Capitalization Documents (except
any stockholders agreement between or among the holders of the Acquisition
Securities to the extent such would not reasonably be expected to have a
Material Adverse Effect).
(f) Directly or indirectly modify, amend or otherwise alter the
terms and provisions of the SunTrust LC without the written consent of the
Agent.
SECTION VII.19. Transactions with Affiliates. Except as otherwise
specifically permitted in this Agreement, including fees permitted in Section
7.20 and the transactions contemplated under the Original Acquisition
Documents, the Merger Documents, the Tender Offer Documents and the
Capitalization Documents, directly or indirectly purchase, acquire or lease
any property from, or sell, transfer or lease any property to, or enter into
any other transaction with, any stockholder, Affiliate or agent of any
Borrower, any subsidiary thereof or any relative thereof, except at prices
and on any terms not less favorable to it than that which would have been
obtained in an arm's-length transaction with a non-affiliated third party.
SECTION VII.20. Consulting Fees. Pay any management, consulting or
other fees of any kind to any Affiliate of any Borrower or any subsidiary
thereof, other than salaries to employees consistent with industry practice,
legal fees and consulting and investment banking fees, except as specified in
Schedule 7.20 annexed hereto.
SECTION VII.21. Limitations on Dividends and Other Payments.
Create or otherwise cause or suffer to exist or become effective any
encumbrance or restriction on the ability of any subsidiary of any Borrower
to (a) pay dividends or make any other distributions on its capital stock or
any other equity interest or participation in, or measured by, its profits,
owned by any other Borrower or any subsidiary thereof, or pay any
indebtedness owed to, any other Borrower or any subsidiary thereof, (b) make
loans or advances to any other Borrower or any subsidiary thereof, or (c)
transfer any of its properties or assets to any other Borrower or any
subsidiary thereof, except for such encumbrances or restrictions existing
under or by reason of (i) applicable law, (ii) this Agreement, (iii) the
Senior Indenture as in effect on the Initial Closing Date or (iv) the Senior
Subordinated Indenture as in effect on the Initial Closing Date.
SECTION VII.22. Limitation on Creation of Subsidiaries. Establish,
create or acquire, or permit any subsidiary of any Borrower to establish,
create or acquire, any new subsidiary, without the prior written consent of
the Agent.
SECTION VII.23. Limitation on Issuance of Capital Stock. Issue, or
permit any subsidiary to issue, any capital stock (including by way of sales
of treasury stock) or any options or warrants to purchase, or securities
convertible into, capital stock, except (i) to effect the Merger on the
Merger Closing Date, (ii) to qualify directors to the extent required by
applicable law, (iii) upon the formation of any new subsidiary to the extent
permitted by this Agreement, such newly formed subsidiary may issue capital
stock to the applicable Borrower so long as the capital stock so issued is
immediately pledged to the Agent for the benefit of the Secured Parties under
the applicable Pledge Agreement, and (iv) the issuance by Jitney Jungle of
capital stock (including by way of treasury stock) or any options or warrants
to purchase, or securities convertible into, capital stock of Jitney Jungle.
VIII. EVENTS OF DEFAULT
In case of the happening of any of the following events (herein
called "Events of Default"):
(a) any representation or warranty made or deemed made in or in
connection with this Agreement, any of the Security Documents, the Notes or
other Loan Documents or any Credit Events hereunder, shall prove to have
been incorrect in any material respect when made or deemed to be made;
(b) default shall be made in the payment of any principal of any Note
when and as the same shall become due and payable, whether at the due date
thereof or at a date fixed for prepayment thereof or by acceleration
thereof or otherwise;
(c) default shall be made in the payment of any interest on any Note,
any fee or any other amount payable hereunder, or under or with respect to
the Notes, Letters of Credit, or any other Loan Document or in connection
with any other Credit Event or any of the Transactions when and as the same
shall become due and payable;
(d) default shall be made in the due observance or performance of any
covenant, condition or agreement to be observed or performed on the part of
any Borrower, any Guarantor, any Grantor or any of their respective
subsidiaries pursuant to the terms of this Agreement, any of the Notes, any
of the Security Documents or any other Loan Document (and, with respect to
defaults under
Sections 6.04, 6.06, 6.07 and 6.12 hereof, such default shall continue for
fifteen (15) days);
(e) any Borrower, any Guarantor, any Grantor or any subsidiary of
any thereof shall (i) voluntarily commence any proceeding or file any
petition seeking relief under Title 11 of the United States Code or any
other Federal, state or foreign bankruptcy, insolvency, liquidation or
similar law, (ii) consent to the institution of, or fail to contravene in
a timely and appropriate manner, any such proceeding or the filing of any
such petition, (iii) apply for or consent to the appointment of a
receiver, trustee, custodian, sequestrator or similar official for such
Borrower, such Guarantor, such Grantor or such subsidiary or for a
substantial part of its property or assets, (iv) file an answer
admitting the material allegations of a petition filed against it in any
such proceeding, (v) make a general assignment for the benefit of
creditors, (vi) become unable, admit in writing its inability or fail
generally to pay its debts as they become due or (vii) take corporate
action for the purpose of effecting any of the foregoing;
(f) an involuntary proceeding shall be commenced or an involuntary
petition shall be filed in a court of competent jurisdiction seeking (i)
relief in respect of any Borrower, any Guarantor, any Grantor or any
subsidiary of any thereof, or of a substantial part of the property or
assets of any Borrower, any Guarantor, any Grantor or any subsidiary of
any thereof, under Title 11 of the United States Code or any other
Federal state or foreign bankruptcy, insolvency, receivership or similar
law, (ii) the appointment of a receiver, trustee, custodian, sequestrator
or similar official for any Borrower, any Guarantor, any Grantor or any
subsidiary of any thereof or for a substantial part of the property of
any Borrower, any Guarantor, any Grantor or any subsidiary of any thereof
or (iii) the winding-up or liquidation of any Borrower, any Guarantor,
any Grantor or any subsidiary of any thereof; and such proceeding or
petition shall continue undismissed for 30 days or an order or decree
approving or ordering any of the foregoing shall continue unstayed and in
effect for 60 days;
(g) default shall be made with respect to any Indebtedness
(excluding Indebtedness outstanding hereunder and Indebtedness covered by
clause (h) or (i) of this Article VIII) or any obligations under a
capitalized lease relating to any personal property of any Borrower, any
Guarantor, any Grantor or any subsidiary of any thereof, and, with
respect to such lease, whose unpaid principal amount exceeds (together
with all other Indebtedness or capitalized leases in default under this
clause (g)) $250,000 in the aggregate at any time, if the effect of any
such default shall be to accelerate, or to permit the holder or obligee
of any such Indebtedness or obligations under a capitalized lease (or any
trustee on behalf of such holder or obligee) at its option to accelerate,
the maturity of such Indebtedness or such obligations under a
capitalized lease, or if any such Indebtedness or such obligations under
a capitalized lease shall not be paid
when scheduled to be due and payable (taking into account any grace
periods);
(h) default shall be made with respect to any obligations under a
capitalized lease relating to any real property of any Borrower, any
Guarantor, any Grantor or any subsidiary of any thereof, whose principal
amount exceeds (together with all other capitalized leases in default
under this clause (h)) $2,250,000 in the aggregate at any time, if the
effect of any such default shall be to accelerate the maturity of such
obligations under such capitalized lease;
(i) default shall be made with respect to any IRB Indebtedness
(including, without limitation, under the Letter of Credit Reimbursement
Agreement, dated as of December 1, 1995, between XxXxxxx-Xxxxxx Co., Inc.
and Sun Trust Bank, Atlanta (or any successor or replacement agreement),
pursuant to which an irrevocable letter of credit in favor of the IRB
Trustee relating to such Indebtedness, was issued) by the City of
Jackson, Mississippi or any Borrower, and Guarantor, any Grantor or any
subsidiary of any thereof, if the effect of any such default shall be to
accelerate, or to permit the holder or obligee of any such Indebtedness
(or any trustee on behalf of such holder or obligee) at its option to
accelerate, the maturity of such Indebtedness or if any such Indebtedness
shall not be paid when scheduled to be due and payable (taking into
account any grace periods);
(j) (i) a Reportable Event shall have occurred with respect to a
Pension Plan, (ii) the filing by any Borrower, any ERISA Affiliate, or an
administrator of any Plan of a notice of intent to terminate such a Plan
in a "distress termination" under the provisions of Section 4041 of
ERISA, (iii) the receipt of notice by any Borrower, any ERISA Affiliate,
or an administrator of a Plan that the PBGC has instituted proceedings to
terminate (or appoint a trustee to administer) such a Pension Plan, (iv)
any other event or condition exists which constitutes grounds under the
provisions of Section 4042 of ERISA for the termination of (or the
appointment of a trustee to administer) any Pension Plan by the PBGC, (v)
a Pension Plan shall fail to maintain the minimum funding standard
required by Section 412 of the Code for any plan year or a waiver of such
standard is sought or granted under the provisions of Section 412(d) of
the Code, (vi) any Borrower or any ERISA Affiliate thereof has incurred,
or is likely to incur, a liability under the provisions of Section 4062,
4063, 4064, 4201 or 4203 of ERISA, (vii) any Borrower or any ERISA
Affiliate thereof fails to pay the full amount of an installment required
under Section 412(m) of the Code, (viii) the occurrence of any other
event or condition with respect to any Plan which would constitute an
event of default under any other agreement entered into by any Borrower
or any ERISA Affiliate, and in each case in clauses (i) through (viii) of
this subsection (h), such event or condition, together with all other
such events or conditions, if any, could subject any Borrower or any
ERISA Affiliate thereof to any taxes, penalties or other liabilities
which, in the reasonable opinion of the
Agent, would have a Material Adverse Effect on the financial condition of
any Borrower or any ERISA Affiliate;
(k) any Borrower or any ERISA Affiliate thereof (i) shall have been
notified by the sponsor of a Multiemployer Plan that it has incurred any
material withdrawal liability to such Multiemployer Plan, and (ii) does
not have reasonable grounds for contesting such withdrawal liability and
is not in fact contesting such withdrawal liability in a timely and
appropriate manner;
(l) a judgment (not reimbursed by insurance policies of any
Borrower, any Guarantor, any Grantor or any subsidiary of any thereof) or
decree for the payment of money, a fine or penalty which when taken
together with all other such judgments, decrees, fines and penalties
shall exceed $500,000 shall be rendered by a court or other tribunal
against any Borrower, any Guarantor, any Grantor or any subsidiary of any
thereof and (i) shall remain undischarged or unbonded for a period of 30
consecutive days during which the execution of such judgment, decree,
fine or penalty shall not have been stayed effectively or (ii) any
judgment creditor or other person shall legally commence actions to
collect on or enforce such judgment, decree, fine or penalty;
(m) this Agreement, any Note, any of the Security Documents or any
of the other Loan Documents shall for any reason cease to be, or shall be
asserted by any Borrower, any Guarantor or any Grantor not to be, a
legal, valid and binding obligation of such Borrower, such Guarantor or
such Grantor, as applicable, enforceable in accordance with its terms, or
the security interest or Lien purported to be created by any of the
Security Documents shall for any reason cease to be, or be asserted by
any Borrower, any Guarantor or any Grantor not to be, a valid, first
priority perfected security interest in any Collateral (except to the
extent otherwise permitted under this Agreement or any of the Security
Documents);
(n) a Change of Control shall occur;
(o) any of the Related Transactions (other than the initial
borrowing under the Commitment, the acquisition of all of the Target
Stock and the Merger) shall not have been duly and validly consummated on
the Initial Closing Date, without modification, amendment or waiver
(except for de minimis modifications, amendments and waivers of which the
Agent shall have received prior notification and except for other
modifications, amendments or waivers as shall have been approved in
writing by the Agent), in accordance with the terms, conditions and
provisions of the Merger Documents, the Tender Offer Documents or the
Senior Subordinated Indenture, as the case may be; or
(p) the Merger shall not have been duly and validly consummated no
later than the 180th day after the date hereof, without modification,
amendment or waiver (except for de minimis modifications, amendments and
waivers of which the Agent shall have received prior notification and
except for other modifications, amendments or waivers as shall have been
approved in writing by the Agent), in accordance with the terms,
conditions and provisions of the Merger Documents and the Tender Offer
Documents;
then, and in any such event (other than an event described in paragraph (e)
or (f) above), and at any time thereafter during the continuance of such
event, the Agent may, and upon the written request of the Required Lenders
shall, by written notice (or facsimile notice promptly confirmed in writing)
to the Borrowers, take any or all of the following actions at the same or
different times: (i) terminate forthwith all or any portion of the Total
Commitment and the obligations of the Letter of Credit Issuer to issue
Letters of Credit hereunder; and (ii) declare the Notes, any amounts then
owing to the Lenders or the Letter of Credit Issuer on account of drawings
under any Letters of Credit and all other Obligations to be forthwith due and
payable, whereupon the principal of such Notes, together with accrued
interest and fees thereon and any amounts then owing to the Lenders or the
Letter of Credit Issuer on account of drawings under any Letters of Credit
and other liabilities of the Borrowers accrued hereunder and all other
Obligations, shall become forthwith due and payable, without presentment,
demand, protest or any other notice of any kind, all of which are hereby
expressly waived by each Borrower and each Guarantor, anything contained
herein or in the Notes to the contrary notwithstanding; provided, however,
that with respect to a default described in paragraph (e) or (f) above, the
Total Commitment and the obligation of the Letter of Credit Issuer to issue
Letters of Credit shall automatically terminate and the principal of the
Notes, together with accrued interest and fees thereon and any amounts then
owing to the Lenders and the Letter of Credit Issuer on account of drawings
under any Letters of Credit and any other liabilities of any Borrower accrued
hereunder and all other Obligations shall automatically become due and
payable, without presentment, demand, protest or other notice of any kind,
all of which are hereby expressly waived by each Borrower and each Guarantor,
anything contained herein or in the Notes to the contrary notwithstanding.
During the continuance of an Event of Default, the Agent shall have
and may exercise all rights and remedies of a mortgagee or a secured party
under the Uniform Commercial Code in effect in the State of New York at such
time, whether or not applicable to the affected Collateral, and otherwise,
including, without limitation, the right to foreclose the Liens granted
herein or in any of the Security Documents by any available judicial
procedure and/or to take possession of any or all of the Collateral, the
other security for the Obligations and the books and records relating
thereto, with or without judicial process; for the purposes of the preceding
sentence, the Agent may enter upon any or all of the premises where any of
the Collateral, such other security or books or records may be situated and
take possession and remove the same therefrom.
The Agent shall have the right, in its sole discretion, to determine
which rights, Liens or remedies it shall at any time pursue, relinquish,
subordinate, modify or take any other action with respect thereto, without in
any way modifying or affecting any of them or any of the Lenders', the Letter
of Credit Issuer's or the Agent's rights hereunder or under any other Loan
Documents; and any moneys, deposits, accounts, balances or other property
which may come into any Lender's, the Letter of Credit Issuer's or the
Agent's hands at any time or in any manner, may be retained by such Lender,
the Letter of Credit Issuer or the Agent and applied to any of the
Obligations.
In case any one or more Events of Default shall occur and be
continuing, the Agent may proceed to protect and enforce its rights or
remedies either by suit in equity or by action at law, or both, whether for
the specific performance of any covenant, agreement or other provision
contained herein or in any document or instrument delivered in connection
with or pursuant to this Agreement or any other Loan Document, or to enforce
the payment of the Obligations or any other legal or equitable right or
remedy.
No right or remedy herein conferred upon the Lenders, the Letter of
Credit Issuer or the Agent is intended to be exclusive of any other right or
remedy contained herein or in any instrument or document delivered in
connection with or pursuant to this Agreement or any other Loan Document, and
every such right or remedy shall be cumulative and shall be in addition to
every other such right or remedy contained herein and therein or now or
hereafter existing at law or in equity or by statute, or otherwise.
No course of dealing between any Borrower or any Grantor or
Guarantor and any Lender, the Letter of Credit Issuer or the Agent or any
failure or delay on the part of any Lender, the Letter of Credit Issuer or
the Agent in exercising any rights or remedies hereunder or under any other
Loan Document shall operate as a waiver of any rights or remedies of the
Lenders, the Letter of Credit Issuer or the Agent and no single or partial
exercise of any rights or remedies hereunder or under any other Loan Document
shall operate as a waiver or preclude the exercise of any other rights or
remedies hereunder or under any other Loan Document or of the same right or
remedy on a future occasion.
After the occurrence of an Event of Default and acceleration of the
Obligations as herein provided, the proceeds of the Collateral and of
property of persons other than the Borrowers and the Grantors securing the
Obligations and collections from each Guarantee of the Obligations shall be
applied by the Agent to payment of the Obligations in the following order,
unless a court of competent jurisdiction shall otherwise direct or if
otherwise provided in a Security Document:
(i) FIRST, to payment of all reasonable costs and expenses of
the Agent, the Letter of Credit Issuer and the Lenders incurred in
connection with
the preservation, collection and enforcement of the Obligations or any
Guarantee thereof, or of any of the Liens granted to the Agent pursuant
to the Security Documents or otherwise, including, without limitation,
any amounts advanced by the Agent, the Letter of Credit Issuer or the
Lenders to protect or preserve the Collateral;
(ii) SECOND, to payment of that portion of the Obligations
constituting accrued and unpaid interest and fees and indemnities due and
payable under Section 2 hereof, ratably amongst the Agent, the
Letter of Credit Issuer and the Lenders in accordance with the
proportion which the accrued interest and fees and indemnities due
and payable under Section 2 hereof constituting the Obligations
owing to the Agent, the Letter of Credit Issuer and each such Lender
at such time bears to the aggregate amount of accrued interest and
fees and indemnities payable under Section 2 hereof constituting the
Obligations owing to the Agent, the Letter of Credit Issuer and all of
the Lenders at such time until such interest, fees and indemnities shall
be paid in full;
(iii) THIRD, to the Agent on behalf of the Letter of Credit
Issuer in an amount equal to 103% of the then aggregate undrawn amount of
all outstanding Letters of Credit to be held by the Agent for the payment
of the Obligations with respect thereto when and if due and payable;
(iv) FOURTH, to payment of the principal of the Obligations
(which shall exclude all Obligations with respect to the undrawn amount
of Letters of Credit), ratably amongst the Lenders and the Letter of
Credit Issuer in accordance with the proportion which the principal
amount of the Obligations (which shall exclude all Obligations with
respect to the undrawn amount of Letters of Credit) owing to each such
Lender and the Letter of Credit Issuer bears to the aggregate
principal amount of the Obligations (which shall exclude all
Obligations with respect to the undrawn amount of Letters of Credit)
owing to all of the Lenders and the Letter of Credit Issuer until
such principal of the Obligations shall be paid in full;
(v) FIFTH, to the payment of all other Obligations, ratably
amongst the Lenders in accordance with the proportion which the amount of
such other Obligations owing to each such Lender bears to the aggregate
principal amount of such other Obligations owing to all of the Lenders
until such other Obligations shall be paid in full; and
(vi) SIXTH, the balance, if any, after all of the Obligations
have been satisfied, shall, except as otherwise provided in the Security
Documents, be deposited by the Agent in an operating account of the
Borrowers with the Agent designated by the Borrowers, or paid over
to such other person or
persons as may be required by law.
In the event that the amount of monies received by the Agent under clause
(iii) above with respect to a Letter of Credit for which there are undrawn
amounts at the time of the Agent's receipt of such monies shall exceed the
amount of actual payments the Letter of Credit Issuer shall have made with
respect to drawings under such Letter of Credit after the Agent's receipt of
such monies, which determination shall be made after such Letter of Credit
has been terminated or has expired, then the Agent shall apply such excess
monies and cash collateral in accordance with paragraphs (iv), (v) and (vi)
of the immediately preceding paragraph.
Each of the Borrowers and the Guarantors acknowledges and agrees that
they shall remain jointly and severally liable to the extent of any
deficiency between the amount of the proceeds of the Collateral and
collections under the Guarantees of the Obligations and the aggregate amount
of the sums referred to in the first through fifth clauses above.
IX. AGENT
In order to expedite the transactions contemplated by this Agreement,
Fleet Capital Corporation is hereby appointed to act as Agent on behalf of
the Lenders. Each of the Lenders and each subsequent holder of any Note or
issuer of any Letter of Credit by its acceptance thereof, irrevocably
authorizes the Agent to take such action on its behalf and to exercise such
powers hereunder and under the Security Documents and other Loan Documents as
are specifically delegated to or required of the Agent by the terms hereof
and the terms thereof together with such powers as are reasonably incidental
thereto. Neither the Agent nor any of its directors, officers, employees or
agents shall be liable as such for any action taken or omitted to be taken by
it or them hereunder or under any of the Security Documents and other Loan
Documents or in connection herewith or therewith (a) at the request or with
the approval of the Required Lenders (or, if otherwise specifically required
hereunder or thereunder, the consent of all the Lenders) or (b) in the
absence of its or their own gross negligence, bad faith or willful
misconduct.
The Agent is hereby expressly authorized on behalf of the Lenders,
without hereby limiting any implied authority, (a) to receive on behalf of
each of the Lenders any payment of principal of or interest on the Notes
outstanding hereunder and all other amounts accrued hereunder paid to the
Agent, and promptly to distribute to each Lender its proper share of all
payments so received, (b) to distribute to each Lender copies of all notices,
agreements and other material as provided for in this Agreement or in the
Security Documents and other Loan Documents as received by such Agent and (c)
to take all actions with respect to this Agreement and the Security Documents
and other Loan Documents as are specifically delegated to the Agent.
The Lenders hereby designate DLJ Capital Funding, Inc. as Documentation
Agent. The Documentation Agent, in its capacity as documentation agent,
shall have no rights, responsibilities, duties or obligations under this
Agreement or any other Loan Document.
In the event that (a) the Borrowers fail to pay when due the principal of
or interest on any Note, any amount payable under or with respect to any
Letter of Credit, or any fee payable hereunder or (b) the Agent receives
written notice of or otherwise becomes aware of the occurrence of a Default
or an Event of Default, the Agent shall promptly give written notice thereof
to the Lenders, and shall take such action with respect to such Event of
Default or other condition or event as it shall be directed to take by the
Required Lenders (but shall not be required to take any such actions which
violate any law or any term of this Agreement or any other Loan Document);
provided, however, that, unless and until the Agent shall have received such
directions, the Agent may take such action or refrain from taking such action
hereunder or under the Security Documents or other Loan Documents with
respect to a Default or Event of Default as it shall deem advisable in the
best interests of the Lenders.
Neither the Agent nor the Documentation Agent shall be responsible in any
manner to any of the Lenders for the effectiveness, enforceability,
perfection, value, genuineness, validity or due execution of this Agreement,
the Notes or any of the other Loan Documents or Collateral or any other
agreements or certificates, requests, financial statements, notices or
opinions of counsel or for any recitals, statements, warranties or
representations contained herein or in any such instrument or be under any
obligation to ascertain or inquire as to the performance or observance of any
of the terms, provisions, covenants, conditions, agreements or obligations of
this Agreement or any of the other Loan Documents or any other agreements on
the part of any Borrower or any Guarantor and, without limiting the
generality of the foregoing, the Agent shall, in the absence of knowledge to
the contrary, be entitled to accept any certificate furnished pursuant to
this Agreement or any of the other Loan Documents as conclusive evidence of
the facts stated therein and shall be entitled to rely on any note, notice,
consent, certificate, affidavit, letter, telegram, teletype message,
statement, order or other document which it believes in good faith to be
genuine and correct and to have been signed or sent by the proper person or
persons. It is understood and agreed that the Agent may exercise its rights
and powers under other agreements and instruments to which it is or may be a
party, and engage in other transactions with any Borrower or any Guarantor,
as though it were not Agent of the Lenders hereunder.
Neither the Agent, the Documentation Agent nor any of their respective
directors, officers, employees or agents shall have any responsibility to any
Borrower or any Guarantor on account of the failure or delay in performance
or breach by any Lender other than the Agent of any of its obligations
hereunder or to any Lender on account of the failure of or delay in
performance or breach by any other Lender or any
Borrower or any Guarantor of any of their respective obligations hereunder or
in connection herewith.
The Agent may consult with legal counsel selected by it in connection
with matters arising under this Agreement or any of the other Loan Documents
and any action taken or suffered in good faith by it in accordance with the
opinion of such counsel shall be full justification and protection to it.
The Agent may exercise any of its powers and rights and perform any duty
under this Agreement or any of the other Loan Documents through agents or
attorneys.
The Agent and the Borrowers may deem and treat the payee of any Note as
the holder thereof until written notice of transfer shall have been delivered
as provided herein by such payee to the Agent and the Borrowers.
With respect to the Loans made hereunder, the Notes issued to it and any
other Credit Event applicable to it, the Agent in its individual capacity and
not as an Agent and the Documentation Agent in its individual capacity and
not as Documentation Agent shall have the same rights, powers and duties
hereunder and under any other Loan Document executed in connection herewith
as any other Lender and may exercise the same as though it were not the Agent
or the Documentation Agent, as the case may be, and the Agent, the
Documentation Agent and their respective affiliates may accept deposits from,
lend money to and generally engage in any kind of business with any Borrower,
any Guarantor or other affiliate thereof as if it were not the Agent or the
Documentation Agent, as the case may be.
Each Secured Party agrees (i) to reimburse the Agent and the
Documentation Agent in the amount of such Lender's pro rata share (based on
its Total Commitment hereunder) of any expenses incurred for the benefit of
the Secured Parties by the Agent or the Documentation Agent (as applicable),
including counsel fees and compensation of agents paid for services rendered
on behalf of the Secured Parties, not reimbursed by the Borrowers and (ii) to
indemnify and hold harmless the Agent, the Documentation Agent and any of
their respective directors, officers, employees or agents, on demand, in the
amount of its pro rata share, from and against any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements of any kind or nature whatsoever which may be
imposed on, incurred by or asserted against it or such directors, officers,
employees or agents in its or their capacity as, or acting on behalf of, the
Agent or the Documentation Agent (as applicable) in any way relating to or
arising out of this Agreement or any of the other Loan Documents or any
action taken or omitted by it or any of them under this Agreement or any of
the other Loan Documents, to the extent not reimbursed by the Borrowers;
provided, however, that no Secured Party shall be liable to the Agent or the
Documentation Agent's (as applicable) for any portion of such liabilities,
obligations, losses, damages, penalties, actions, judgment, suits, costs,
expenses or disbursements resulting from the gross negligence or willful
misconduct of the Agent, the
Documentation Agent or any of their respective directors, officers, employees
or agents.
Each Lender acknowledges that it has, independently and without reliance
upon the Agent, the Documentation Agent, Fleet, DLJ or any other Lender and
based on such documents and information as it has deemed appropriate, made
its own credit analysis and decision to enter into this Agreement and any
other Loan Document to which such Lender is party. Each Lender also
acknowledges that it will, independently and without reliance upon the Agent,
the Documentation Agent, Fleet, DLJ or any other Lender and based on such
documents and information as it shall deem appropriate at the time, continue
to make its own decisions in taking or not taking action under or based upon
this Agreement, any other Loan Document, any related agreement or any
document furnished hereunder.
Subject to the appointment and acceptance of a successor Agent as
provided below, the Agent may resign at any time by notifying the Lenders and
the Borrowers. Upon any such resignation, the Lenders shall have the right
to appoint a successor Agent. If no successor Agent shall have been so
appointed by such Lenders and shall have accepted such appointment within 30
days after the retiring Agent gives notice of its resignation, then the
retiring Agent may, on behalf of the Lenders, appoint a successor Agent which
shall be a financial institution with an office (or an affiliate with an
office) in New York, New York, having a combined capital and surplus of at
least $500,000,000. Upon the acceptance of any appointment as Agent
hereunder by a successor financial institution, such successor shall
thereupon succeed to and become vested with all the rights, powers,
privileges and duties of the retiring Agent and the retiring Agent shall be
discharged from its duties and obligations hereunder and under each of the
other Loan Documents. After any Agent's resignation hereunder, the
provisions of this Article shall continue in effect for its benefit in
respect of any actions taken or omitted to be taken by it while it was acting
as Agent.
The Documentation Agent may resign as Documentation Agent at any time by
giving written notice thereof to the Agent. The Agent (and only the Agent)
may appoint a successor Documentation Agent, which Documentation Agent shall
be a Lender or an Affiliate of a Lender; provided, however, that the Agent
shall have no obligation to appoint a successor Documentation Agent.
The Lenders hereby acknowledge that the Agent shall be under no duty to
take any discretionary action permitted to be taken by the Agent pursuant to
the provisions of this Agreement or any of the other Loan Documents unless it
shall be requested in writing to do so by the Required Lenders (and the Agent
shall not be obligated to take any such requested action which violates
applicable law or any terms of this Agreement or any other Loan Document).
The Lenders hereby acknowledge that neither the Agent nor the Documentation
Agent is acting as the fiduciary of, or trustee for, any of the Lenders.
X. CASH RECEIPTS COLLECTION
SECTION X.1. Collection of Cash. (a) (i) The Borrowers will, at
their own cost and expense, cause all payments received by the Borrowers from
any source, whether in the form of cash, checks, notes, drafts, bills of
exchange, money orders, credit card payments, debit card payments or
otherwise (referred to herein as "Payments"), (ii) to be deposited daily in
precisely the form received (but with any endorsements of the Borrowers
necessary for deposit or collection) in one or more bank accounts maintained
by the Borrowers and acceptable to the Agent in which only the Payments owned
by the Borrowers will be deposited, (iii) to be transferred daily from the
accounts referred to in clause (ii) to one or more concentration accounts
designated by the Agent with a bank acceptable to the Agent in which only the
Payments owned by the Borrowers will be deposited, and (iv) cause the
Payments to be transferred daily from the concentration accounts referred to
in clause (iii) to an account of the Agent, such Payments to be subject to
withdrawal by the Agent only, as hereinafter provided. Until such Payments
are deposited with the Agent in accordance with the prior sentence, such
Payments shall be deemed to be held in trust by the Borrowers for and as the
Agent's property. All Payments that are deposited with the Agent in
accordance with the foregoing will, if deposited on or before 1:00 p.m. (New
York time), be applied by the Agent on such Business Day (or, if deposited
after 1:00 p.m. (New York time), within one Business Day after receipt
thereof by the Agent) to reduce the outstanding balance of the Loans and
thereafter other Obligations then due and payable, subject to final
collection in cash of the item deposited. Each bank at which an account
referred to in clause (ii) of the first sentence of this Section 10.01(a) is
maintained and each bank at which a concentration account referred to in
clause (iii) of such sentence shall execute and deliver to the Agent such
agreements, in form and substance satisfactory to the Agent, as the Agent
shall request with respect to such accounts, including, without limitation,
with respect to prohibitions on the Borrowers withdrawing funds from such
accounts or otherwise directing or modifying actions with respect to such
accounts; provided, that with respect to each account referred to in clause
(ii) of the first sentence of this Section 10.01(a) which is maintained by
Delchamps or any subsidiary thereof, such agreements shall be delivered to
the Agent within forty-five (45) days of the Initial Closing Date; provided,
however, that such agreements shall permit the Borrowers to maintain the
maximum balance set forth in Schedule III annexed hereto in each account
referred to in clauses (ii) and (iii) of the first sentence of this Section
10.01(a).
Upon the occurrence and continuance of an Event of Default, the Agent may
send a notice of assignment and/or notice of the Agent's security interest to
any and all third parties holding or otherwise concerned with any of the
Collateral, and thereafter the Agent shall have the sole right to collect
and/or take possession of the Collateral and the books and records relating
thereto.
(b) (i) Each Borrower hereby constitutes the Agent or the Agent's
designee as such person's attorney-in-fact with power to endorse its name
upon any notes, acceptances, checks, drafts, money orders or other evidences
of payment or Collateral that may come into its possession; upon the
occurrence of an Event of Default, to open and dispose of all mail received
by such Borrower and to notify the Postal Service authorities to change the
address for delivery of mail addressed to such person to such address as the
Agent may designate; and to do all other acts and things necessary to carry
out this Agreement. All acts of said attorney or designee are hereby
ratified and approved, and said attorney or designee shall not be liable for
any acts of omission or commission, for any error of judgment or for any
mistake of fact or law; provided, that the Agent or its designee shall not be
relieved of liability to the extent it is determined by a final judicial
decision that its act, error or mistake constituted gross negligence, bad
faith or willful misconduct. This power of attorney being coupled with an
interest is irrevocable until all of the Obligations are paid in full and
this Agreement and the Total Commitment is terminated.
(ii) The Agent, without notice to or consent of any Borrower, shall have
the right to receive, endorse, assign and/or deliver in its name or the name
of any Borrower any and all checks, drafts and other instruments for the
payment of money relating to the Collateral, and each Borrower hereby waives
notice of presentment, protest and non-payment of any instrument so endorsed.
(c) Nothing herein contained shall be construed to constitute any
Borrower as agent of the Agent for any purpose whatsoever, and neither the
Agent nor any Lender shall be responsible or liable for any shortage,
discrepancy, damage, loss or destruction of any part of the Collateral
wherever the same may be located and regardless of the cause thereof (except
to the extent it is determined by a final judicial decision that the Agent's
or a Lender's act or omission constituted gross negligence, bad faith or
willful misconduct). The Agent and the Lenders shall not, under any
circumstances or in any event whatsoever, have any liability for any error or
omission or delay of any kind occurring in the settlement, collection or
payment of any of the Collateral or for any damage resulting therefrom
(except to the extent it is determined by a final judicial decision that the
Agent's or such Lender's error, omission or delay constituted gross
negligence, bad faith or willful misconduct). The Agent and the Lenders do
not, by anything herein or in any assignment or otherwise, assume any
Borrower's obligations under any contract or agreement assigned to the Agent
or the Lenders, and the Agent and the Lenders shall not be responsible in any
way for the performance by any Borrower of any of the terms and conditions
thereof.
(d) If any of the Collateral includes a charge for any tax payable to
any governmental tax authority, the Agent is hereby authorized (but in no
event obligated) in its discretion to pay the amount thereof to the proper
taxing authority for the account of the Borrowers and to charge the
Borrowers' account therefor. The Borrowers shall
notify the Agent if any Collateral includes any tax due to any such taxing
authority and, in the absence of such notice, the Agent shall have the right
to retain the full proceeds of such Collateral and shall not be liable for
any taxes that may be due from the Borrowers by reason of the sale of any of
the Collateral.
SECTION X.2. Monthly Statement of Account. The Agent shall render to
the Borrowers each calendar month a statement of the Borrowers' account,
which shall constitute an account stated and shall be deemed to be correct
and accepted by and be binding upon the Borrowers unless the Agent receives a
written statement of the Borrowers' exceptions within 30 days after such
statement was rendered to the Borrowers.
SECTION X.3. Collateral Custodian. Upon the occurrence and continuance
of an Event of Default, the Agent may at any time and from time to time
employ and maintain in the premises of the Borrowers a custodian selected by
the Agent who shall have full authority to do all acts necessary to protect
the Agent's and Lenders' interests and to report to the Agent thereon. Each
Borrower hereby agrees to cooperate with any such custodian and to do
whatever the Agent may reasonably request to preserve the Collateral. All
costs and expenses incurred by the Agent by reason of the employment of the
custodian shall be charged to the Borrowers' account and added to the
Obligations.
XI. MISCELLANEOUS
SECTION XI.1. Notices. Notices, consents and other communications
provided for herein shall be in writing and shall be delivered or mailed by
certified mail return receipt requested (or in the case of telex or facsimile
communication, delivered by telex, graphic scanning, telecopier or other
telecommunications equipment, with receipt confirmed with a copy mailed as
aforesaid) addressed,
(a) if to any Borrower, Guarantor or Grantor, at 0000 Xxxxx Xxxxxx,
Xxxxxxx, XX 00000, Attention: Xxxxxxx X. Xxxxxx, President, with copies
to Bruckmann, Xxxxxx, Xxxxxxxx & Co., Inc., 000 Xxxx 00xx Xxxxxx, Xxx
Xxxx, XX 00000, Attention: Xxxxxx Xxxxxx, Managing Director; and
Dechert, Price & Xxxxxx, 4000 Xxxx Atlantic Tower, 0000 Xxxx Xxxxxx,
Xxxxxxxxxxxx, XX 00000, Attention: Xxxx X. Xxxxx, Esq.;
(b) if to the Agent, at Fleet Capital Corporation, 00 Xxxx 00xx
Xxxxxx, Xxx Xxxx, XX 00000, Attention: Xx. Xxxxxx Xxxxxx, with a copy to
Xxxx, Scholer, Fierman, Xxxx & Handler, LLP, 000 Xxxx Xxxxxx, Xxx Xxxx, XX
00000, Attention: Xxxxxx X. Xxxxxxx, Esq.; and
(c) if to any Lender, at the address set forth below its name in
Schedule 2.01 annexed hereto.
All notices and other communications given to any party hereto in accordance
with the provisions of this Agreement shall be deemed to have been given on
the date of receipt if hand delivered or three days after being sent by
registered or certified mail, postage prepaid, return receipt requested, if
by mail, or upon receipt if by any telex, facsimile or other
telecommunications equipment, in each case addressed to such party as
provided in this Section 11.01 or in accordance with the latest unrevoked
direction from such party.
SECTION XI.2. Survival of Agreement. All covenants, agreements,
representations and warranties made by any Borrower, any Guarantor or any of
their respective subsidiaries herein and in the certificates or other
instruments prepared or delivered in connection with this Agreement, any of
the Security Documents or any other Loan Document, shall be considered to
have been relied upon by the Lenders and shall survive the making by the
Lenders of the Loans and the execution and delivery to the Lenders of the
Notes and occurrence of any other Credit Event and shall continue in full
force and effect as long as the principal of or any accrued interest on the
Notes or any other fee or amount payable under the Notes or this Agreement or
any other Loan Document is outstanding and unpaid and so long as the Total
Commitment has not been terminated.
SECTION XI.3. Successors and Assigns; Participations. (a) Whenever in
this Agreement any of the parties hereto is referred to, such reference shall
be deemed to include the successors and assigns of such party; and all
covenants, promises and agreements by or on behalf of any Borrower, any
Guarantor, any Grantor, any ERISA Affiliate, any subsidiary of any thereof,
the Agent or the Lenders, that are contained in this Agreement shall bind and
inure to the benefit of their respective successors and assigns. Without
limiting the generality of the foregoing, each Borrower specifically confirms
that any Lender may at any time and from time to time pledge or otherwise
grant a security interest in any Loan or any Note (or any part thereof) to
any Federal Reserve Bank. The Borrowers may not assign or transfer any of
their rights or obligations hereunder without the written consent of all the
Lenders.
(b) Each Lender, without the consent of the Borrowers, may sell
participations to one or more banks or other entities in all or a portion of
its rights and obligations under this Agreement (including, without
limitation, all or a portion of its Commitment) and the Loans owing to it and
interest in undrawn Letters of Credit and the Notes held by it); provided,
however, that (i) such Lender's obligations under this Agreement (including,
without limitation, its Commitment), shall remain unchanged, (ii) such Lender
shall remain solely responsible to the other parties hereto for the
performance of such obligations, (iii) the banks or other entities buying
participations shall be entitled to the cost protection provisions contained
in Sections 2.10(a) (except to the extent that application of such Section
2.10(a) to such banks and entities would
cause any Borrower to make duplicate payments thereunder), 2.11, 2.12 and
2A.04 hereof, but only to the extent any of such Sections would be available
to the Lender which sold such participation, and (iv) the Borrowers, the
Agent and the other Lenders shall continue to deal solely and directly with
such Lender in connection with such Lender's rights and obligations under
this Agreement; provided, further, however, that each Lender shall retain the
sole right and responsibility to enforce the obligations of the Borrowers,
the Grantors and the Guarantors relating to the Loans, including, without
limitation, the right to approve any amendment, modification or waiver of any
provision of this Agreement, other than amendments, modifications or waivers
with respect to any fees payable hereunder or the amount of principal or the
rate of interest payable on, or the dates fixed for any payment of principal
of or interest on, the Loans in which such entity is participating or the
release of all Collateral.
(c) Each Lender may assign and delegate to an Eligible Assignee
with the prior written consent of the Borrowers (such consent not to be
unreasonably withheld or delayed) and with the prior written consent of the
Agent (such consent not to be unreasonably withheld or delayed), all or a
portion of its interests, rights and obligations under this Agreement and the
other Loan Documents (including, without limitation, all or a portion of its
Commitment and the same portion of the Loans and interest in undrawn Letters
of Credit at the time owing to it and the Note or Notes held by it);
provided, however, that (i) each such assignment shall be of a constant, and
not a varying, percentage of all of the assigning Lender's rights and
obligations under this Agreement, which shall include the same percentage
interest in the Loans, interest in undrawn and unreimbursed Letters of Credit
and Notes, (ii) the amount of the Commitment of the assigning Lender being
assigned pursuant to each such assignment (determined as of the date the
Assignment and Acceptance with respect to such assignment is delivered to the
Agent) shall be in a minimum principal amount of $10,000,000 and (iii) the
parties to each such assignment shall execute and deliver to the Agent, for
its acceptance and recording in the Register (as defined below), an
Assignment and Acceptance, together with any Note subject to such assignment
and a processing and recordation fee of $3,000. Upon such execution,
delivery, acceptance and recording and after receipt of the written consent
of the Agent, from and after the effective date specified in each Assignment
and Acceptance, which effective date shall be at least five (5) Business Days
after the execution thereof, (x) the assignee thereunder shall be a party
hereto and, to the extent provided in such Assignment and Acceptance, have
the rights and obligations of a Lender hereunder and under the other Loan
Documents and (y) the Lender which is assignor thereunder shall, to the
extent provided in such Assignment and Acceptance, be released from its
obligations under this Agreement with respect to the period after the date of
such assignment (and, in the case of an Assignment and Acceptance covering
all or the remaining portion of an assigning Lender's rights and obligations
under this Agreement, such Lender shall cease to be a party hereto).
Notwithstanding any other provisions of this Section 11.03(c), no transfer or
assignment of the interests or obligations of any Lender hereunder or any
grant of participation therein shall be permitted prior to the
Syndication Date.
(d) By executing and delivering an Assignment and Acceptance, the
Lender which is assignor thereunder and the assignee thereunder confirm to,
and agree with, each other and the other parties hereto as follows: (i)
other than the representation and warranty that it is the legal and
beneficial owner of the interest being assigned thereunder free and clear of
any adverse claim, such Lender makes no representation or warranty and
assumes no responsibility with respect to any statements, warranties or
representations made in or in connection with this Agreement or the
execution, legality, validity, enforceability, perfection, genuineness,
sufficiency or value of this Agreement, the other Loan Documents or any
Collateral with respect thereto or any other instrument or document furnished
pursuant hereto or thereto; (ii) such Lender makes no representation or
warranty and assumes no responsibility with respect to the financial
condition of any Borrower, or any Grantor or Guarantor or the performance or
observance by any Borrower, Grantor or the Guarantor of any of their
respective obligations under this Agreement, any of the other Loan Documents
or any other instrument or document furnished pursuant hereto or thereto;
(iii) such assignee confirms that it has received a copy of this Agreement
and of the other Loan Documents, together with copies of financial statements
and such other documents and information as it has deemed appropriate to make
its own credit analysis and decision to enter into such Assignment and
Acceptance; (iv) such assignee will, independently and without reliance upon
the Agent, such Lender or any other Lender and based on such documents and
information as it shall deem appropriate at the time, continue to make its
own credit decisions in taking or not taking action under this Agreement; (v)
such assignee appoints and authorizes the Agent to take such action as the
Agent on its behalf and to exercise such powers under this Agreement as are
delegated to the Agent by the terms hereof, together with such powers as are
reasonably incidental thereto; and (vi) such assignee agrees that it will
perform in accordance with their terms all of the obligations which by the
terms of this Agreement are required to be performed by it as a Lender.
(e) The Agent shall maintain at its address referred to in Section
11.01 hereof a copy of each Assignment and Acceptance delivered to it and a
register for the recordation of the names and addresses of the Lenders and
the Commitment of, and principal amount of the Loans owing to, each Lender
from time to time (the "Register"). The entries in the Register shall be
conclusive, in the absence of manifest error, and the Borrowers, the Agent
and the Lenders may treat each person whose name is recorded in the Register
as a Lender hereunder for all purposes of this Agreement. The Register shall
be available for inspection by the Borrowers or any Lender at any reasonable
time and from time to time upon reasonable prior notice.
(f) Upon its receipt of an Assignment and Acceptance executed by an
assigning Lender and an assignee together with any Note or Notes subject to
such assignment and the written consent to such assignment, the Agent shall,
if such
Assignment and Acceptance has been completed and is in substantially the form
of Exhibit E annexed hereto, (i) accept such Assignment and Acceptance, (ii)
record the information contained therein in the Register and (iii) give
prompt notice thereof to the Lenders and the Borrowers. Within five (5)
Business Days after receipt of such notice, the Borrowers, at their own
expense, shall execute and deliver to the Agent in exchange for each
surrendered Note or Notes a new Note or Notes to the order of such assignee
in an amount equal to its portion of the Commitment assumed by it pursuant to
such Assignment and Acceptance and, if the assigning Lender has retained any
Commitment hereunder, a new Note or Notes to the order of the assigning
Lender in an amount equal to the Commitment retained by it hereunder. Such
new Note or Notes shall be in an aggregate principal amount equal to the
aggregate principal amount of such surrendered Note or Notes, shall be dated
the effective date of such Assignment and Acceptance and shall otherwise be
in substantially the form of Exhibit A. Notes surrendered to the Borrowers
shall be canceled by the Borrowers.
(g) Notwithstanding any other provision herein, any Lender may, in
connection with any assignment or participation or proposed assignment or
participation pursuant to this Section 11.03, disclose to the assignee or
participant or proposed assignee or participant, any information, including,
without limitation, any Information, relating to any Borrower, any Grantor or
any Guarantor furnished to such Lender by or on behalf of any Borrower in
connection with this Agreement; provided, however, that prior to any such
disclosure, each such assignee or participant or proposed assignee or
participant shall agree to preserve the confidentiality of any confidential
Information relating to the Borrowers received from such Lender.
SECTION XI.4. Expenses; Indemnity. (a) Each Borrower agrees to
pay all out-of-pocket expenses incurred by the Agent in connection with the
preparation of this Agreement, the Security Documents, the Notes and the
other Loan Documents or with any amendments, modifications, waivers,
extensions, renewals, renegotiations or work-outs of the provisions hereof or
thereof (whether or not the transactions hereby contemplated shall be
consummated) or incurred by the Agent, the Documentation Agent, the Letter of
Credit Issuer or any of the Lenders in connection with the enforcement or
protection of its rights in connection with this Agreement or any of the
other Loan Documents or with the Loans made or the Notes or Letters of Credit
issued hereunder, or in connection with any pending or threatened action,
proceeding, or investigation relating to the foregoing, including but not
limited to the reasonable fees and disbursements of counsel for the Agent,
the Documentation Agent, the Letter of Credit Issuer and each Lender and
ongoing field examination expenses and charges. Without limitation of the
foregoing, each Borrower hereby agrees to reimburse the Agent for any and all
reasonable costs and expenses incurred in connection with audits and field
exams of the Borrowers' and their subsidiaries' properties, assets, business
and operations performed at the request of the Agent by an independent party
selected by the Agent (provided that as long as the Default or Event of
Default is in existence, the obligations of the Borrowers under this sentence
shall not exceed
$50,000 per calendar year). Each Borrower further indemnifies the Lenders
and the Letter of Credit Issuer from and agrees to hold them harmless against
any documentary taxes, assessments or charges made by any governmental
authority by reason of the execution and delivery of this Agreement, the
Notes or the making of any Credit Events.
(b) Each Borrower indemnifies the Agent, the Documentation Agent,
the Letter of Credit Issuer and each Lender and their respective directors,
officers, employees and agents against, and agrees to hold the Agent, the
Letter of Credit Issuer, each Lender and each such person harmless from, any
and all losses, claims, damages, liabilities and related expenses, including
reasonable counsel fees and expenses, incurred by or asserted against the
Agent, the Documentation Agent, the Letter of Credit Issuer, the Lender or
any such person arising out of, in any way connected with, or as a result of
(i) the use of any of the proceeds of the Loans or of any Letter of Credit,
(ii) this Agreement, any of the Security Documents, or the other documents
contemplated hereby or thereby, except, as to any Lender, as a result of a
breach thereof by such Lender (iii) the performance by the parties hereto and
thereto of their respective obligations hereunder and thereunder (including
but not limited to the making of the Total Commitment) and consummation of
the transactions contemplated hereby and thereby, (iv) breach of any
representation or warranty, or (v) any claim, litigation, investigation or
proceedings relating to the Related Transactions and/or any of the foregoing,
whether or not the Agent, the Documentation Agent, the Letter of Credit
Issuer, any Lender or any such person is a party thereto; provided, however,
that such indemnity shall not, as to the Agent, the Documentation Agent, the
Letter of Credit Issuer or any Lender, apply to any such losses, claims,
damages, liabilities or related expenses to the extent that they result from
the gross negligence, bad faith or willful misconduct of the Agent, the
Documentation Agent, the Letter of Credit Issuer or any Lender.
(c) Each Borrower indemnifies, and agrees to defend and hold
harmless the Agent, the Letter of Credit Issuer and the Lenders and their
respective officers, directors, shareholders, agents and employees
(collectively, the "Indemnitees") from and against any loss, cost, damage,
liability, lien, deficiency, fine, penalty or expense (including, without
limitation, reasonable attorneys' fees and reasonable expenses for
investigation, removal, cleanup and remedial costs and modification costs
incurred to permit, continue or resume normal operations of any property or
assets or business of any Borrower or any subsidiary thereof) arising from a
violation of, or failure to comply with any Environmental Law and to remove
any Lien arising therefrom except to the extent caused by the gross
negligence, bad faith or willful misconduct of any Indemnitee, which any of
the Indemnitees may incur or which may be claimed or recorded against any of
the Indemnitees by any person.
(d) The provisions of this Section 11.04 shall remain operative and
in full force and effect regardless of the expiration of the term of this
Agreement, the consummation of the transactions contemplated hereby, the
repayment of any of the
Loans, the invalidity or unenforceability of any term or provision of this
Agreement or the Notes, or any investigation made by or on behalf of the
Agent, the Letter of Credit Issuer or any Lender. All amounts due under this
Section 11.04 shall be payable on written demand therefor (which demand shall
include a reasonable description of such amounts).
SECTION XI.5. Applicable Law. THIS AGREEMENT AND THE NOTES SHALL
BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAW OF THE STATE OF NEW
YORK (OTHER THAN THE CONFLICTS OF LAWS PRINCIPLES THEREOF).
SECTION XI.6. Right of Setoff. If an Event of Default shall have
occurred and be continuing, upon the request of the Required Lenders, each
Lender and the Letter of Credit Issuer shall and is hereby authorized at any
time and from time to time, to the fullest extent permitted by law, to set
off and apply any and all deposits (general or special, time or demand,
provisional or final) at any time held and other indebtedness at any time
owing by such Lender or the Letter of Credit Issuer to or for the credit or
the account of the Borrowers against any and all of the Obligations, the
Notes held by such Lender or any other Loan Document, irrespective of whether
or not such Lender or the Letter of Credit Issuer shall have made any demand
under this Agreement, the Notes or such other Loan Document and although such
obligations may be unmatured. Each Lender agrees to notify promptly the
Agent and the Borrowers after any such setoff and application made by such
Lender, but the failure to give such notice shall not affect the validity of
such setoff and application. The rights of each Lender and the Letter of
Credit Issuer under this Section are in addition to other rights and remedies
(including, without limitation, other rights of setoff) which may be
available to such Lender or the Letter of Credit Issuer.
SECTION XI.7. Payments on Business Days. (a) Should the principal
of or interest on the Notes or any fee or other amount payable hereunder
become due and payable on other than a Business Day, payment in respect
thereof may be made on the next succeeding Business Day (except as otherwise
specified in the definition of "Interest Period"), and such extension of time
shall in such case be included in computing interest, if any, in connection
with such payment.
(b) All payments by any Borrower and any Guarantor hereunder and
all Loans made by the Lenders hereunder shall be made in lawful money of the
United States of America in immediately available funds at the office of the
Agent set forth in Section 11.01 hereof.
SECTION XI.8. Waivers; Amendments; Final Maturity Date. (a) No
failure or delay of the Agent, any Lender, Fleet or the Letter of Credit Issuer
in exercising any power or right hereunder or under any other Loan Document
shall operate as a waiver thereof, nor shall any single or partial exercise of
any such right or
power, or any abandonment or discontinuance of steps to enforce such right or
power, preclude any other or further exercise thereof or the exercise of any
other right or power. The rights and remedies of the Agent, the Lenders,
Fleet and the Letter of Credit Issuer hereunder or under any other Loan
Document are cumulative and not exclusive of any rights or remedies which
they may otherwise have. No waiver of any provision of this Agreement or the
Notes nor consent to any departure by any Borrower or any Guarantor therefrom
shall in any event be effective unless the same shall be authorized as
provided in paragraph (b) below, and then such waiver or consent shall be
effective only in the specific instance and for the purpose for which given.
No notice to or demand on any Borrower or any Guarantor in any case shall
entitle it to any other or further notice or demand in similar or other
circumstances. Each holder of any of the Notes shall be bound by any
amendment, modification, waiver or consent authorized as provided herein,
whether or not such Note shall have been marked to indicate such amendment,
modification, waiver or consent.
(b) Neither this Agreement nor any provision hereof may be waived,
amended or modified except pursuant to an agreement or agreements in writing
entered into by the Borrowers and the Required Lenders; provided, however,
(i) that no such agreement shall (A) change the principal amount of, or
extend or advance the maturity of or the dates for the payment of principal
of or interest on, any Note or fees payable hereunder or reduce the rate of
interest on any Note or fees payable hereunder, without the consent of each
holder affected thereby, (B) change the Commitment of any Lender or amend or
modify the provisions of this Section 11.08, Section 2.01, Section 2.06,
Section 2.13, Section 11.04 or Section 2A.06 hereof or the definition of
"Required Lenders" or the dollar amount contained in the definition of
"Supplemental Availability ", or (C) release any substantial portion of the
Collateral, in each case without the prior written consent of each Lender
affected thereby except that the Agent may, without the prior written consent
of any Lender, release Collateral permitted to be sold pursuant to the terms
of Section 7.05 hereof and (ii) that no such agreement shall amend, modify or
otherwise affect the rights or duties of the Agent, Fleet or the Letter of
Credit Issuer under this Agreement or the other Loan Documents without the
written consent of the Agent. Each Lender and holder of any Note shall be
bound by any modification or amendment authorized by this Section regardless
of whether its Notes shall be marked to make reference thereto, and any
consent by any Lender or holder of a Note pursuant to this Section shall bind
any person subsequently acquiring a Note from it, whether or not such Note
shall be so marked.
SECTION XI.9. Severability. In the event any one or more of the
provisions contained in this Agreement or in the Notes should be held
invalid, illegal or unenforceable in any respect, the validity, legality and
enforceability of the remaining provisions contained herein or therein shall
not in any way be affected or impaired thereby. The parties shall endeavor
in good-faith negotiations to replace the invalid, illegal or unenforceable
provisions with valid provisions the economic effect of which comes as close
as possible to that of the invalid, illegal or unenforceable provisions.
SECTION XI.10. Entire Agreement; Waiver of Jury Trial, etc. (a)
This Agreement, the Notes, the Fee Letter and the other Loan Documents
constitute the entire contract between the parties hereto relative to the
subject matter hereof. Any previous agreement among the parties hereto with
respect to the Transactions is superseded by this Agreement, the Notes, the
Fee Letter and the other Loan Documents. Except as expressly provided herein
or in the Notes, the Fee Letter or the Loan Documents (other than this
Agreement), nothing in this Agreement, the Notes, the Fee Letter or in the
other Loan Documents, expressed or implied, is intended to confer upon any
party, other than the parties hereto, any rights, remedies, obligations or
liabilities under or by reason of this Agreement, the Notes or the other Loan
Documents.
(b) EXCEPT AS PROHIBITED BY LAW, EACH PARTY HERETO HEREBY WAIVES
ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION
DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS
AGREEMENT, THE NOTES, ANY OF THE OTHER LOAN DOCUMENTS OR THE TRANSACTIONS.
(c) Except as prohibited by law, each party hereto hereby waives
any right it may have to claim or recover in any litigation referred to in
paragraph (b) of this Section 11.10 any special, exemplary, punitive or
consequential damages or any damages other than, or in addition to, actual
damages.
(d) Each party hereto (i) certifies that no representative, agent
or attorney of any Lender has represented, expressly or otherwise, that such
Lender would not, in the event of litigation, seek to enforce the foregoing
waivers and (ii) acknowledges that it has been induced to enter into this
Agreement, the Notes or the other Loan Documents, as applicable, by, among
other things, the mutual waivers and certifications herein.
SECTION XI.11. Confidentiality. The Agent and the Lenders agree to
keep confidential (and to cause their respective officers, directors,
employees, agents, advisors, consultants and representatives to keep
confidential) all information, materials and documents furnished by or on
behalf of the Guarantors, the Borrowers, the Grantors or any of their
respective subsidiaries to the Agent or any Lender (the "Information").
Notwithstanding the foregoing, the Agent and each Lender shall be permitted
to disclose Information (i) to such of its officers, counsel, directors,
employees, agents, advisors, consultants and representatives as need to know
such Information in connection with its participation in any of the
Transactions or the administration of this Agreement or the other Loan
Documents with instructions to maintain the confidentiality thereof; (ii) to
the extent required by applicable laws and regulations or by any subpoena or
similar legal process, or requested by any governmental agency or authority
(the Agent and each Lender receiving such
subpoena or similar legal process agrees to use reasonable efforts to
promptly furnish the Borrowers with a copy thereof); (iii) to the extent such
Information (A) becomes publicly available other than as a result of a breach
of this Agreement, (B) becomes available to the Agent or such Lender on a
non-confidential basis from a source other than any Borrower, any Guarantor,
any Grantor or any of their respective subsidiaries or (C) was available to
the Agent or such Lender on a non-confidential basis prior to its disclosure
to the Agent or such Lender by any Borrower, any Guarantor, any Grantor or
any of their respective subsidiaries; (iv) to the extent any Borrower, any
Guarantor or any of their respective subsidiaries shall have consented to
such disclosure in writing; (v) in connection with the sale of any Collateral
pursuant to the provisions of any of the other Loan Documents; or (vi)
pursuant to Section 11.03(g) hereof.
SECTION XI.12. Submission to Jurisdiction. (a) Any legal action
or proceeding with respect to this Agreement or the Notes or any other Loan
Document may be brought in state courts located in the City of New York or of
the United States of America for the Southern District of New York, and, by
execution and delivery of this Agreement, each of the Borrowers and each of
the Guarantors hereby accept for themselves and in respect of their property,
generally and unconditionally, the jurisdiction of the aforesaid courts.
(b) Each of the Borrowers and each of the Guarantors hereby
irrevocably waives, in connection with any such action or proceeding, any
objection, including, without limitation, any objection to the laying of
venue or based on the grounds of forum non convenience, which they may now or
hereafter have to the bringing of any such action or proceeding in such
respective jurisdictions.
(c) Each of the Borrowers and each of the Guarantors hereby
irrevocably consents to the service of process of any of the aforementioned
courts in any such action or proceeding by the mailing of copies thereof by
registered or certified mail, postage prepaid, to each such person, as the
case may be, at its address set forth in Section 11.01 hereof.
(d) Nothing herein shall affect the right of the Agent or any
Lender to serve process in any other manner permitted by law or to commence
legal proceedings or otherwise proceed against any Borrower or any Guarantor
in any other jurisdiction.
SECTION XI.13. Counterparts; Facsimile Signature. This Agreement
may be executed in counterparts, each of which shall constitute an original
but all of which when taken together shall constitute but one contract, and
shall become effective when copies hereof which, when taken together, bear
the signatures of each of the parties hereto shall be delivered to the Agent.
Delivery of an executed counterpart of a signature page to this Agreement by
telecopier shall be effective as delivery of a manually executed signature
page hereto.
SECTION XI.14. Headings. Article and Section headings and the Table
of Contents used herein are for convenience of reference only and are not to
affect the construction of, or to be taken into consideration in
interpreting, this Agreement.
SECTION XI.15. Defaulting Lender. (a) Notwithstanding anything to
the contrary contained herein, in the event that any Lender (x) refuses
(which refusal constitutes a breach by such Lender of its obligations under
this Agreement and which has not been retracted) to make available its
portion of any Loan or (y) notifies the Agent and/or any Borrower that it
does not intend to make available its portion of any Loan (if the actual
refusal would constitute a breach by such Lender of its obligations under
this Agreement and which has not been retracted) (each, a "Lender Default"),
all rights and obligations hereunder of the Lender (a "Defaulting Lender") as
to which a Lender Default is in effect and of the other parties hereto shall
be modified to the extent of express provisions of this Section 11.15 while
such Lender Default remains in effect.
(b) Loans shall be incurred pro rata from the Lenders (the
"Non-Defaulting Lenders") which are not Defaulting Lenders based on their
respective Commitments, and no Commitment of any Lender or any pro rata share
of any Loans required to be advanced by any Lender shall be increased as a
result of such Lender Default. Amounts received in respect of principal of
the Loans shall be applied to reduce the Loans of each of the Lenders pro
rata based on the aggregate of the outstanding Loans of all of the Lenders at
the time of such application; provided that, such amount shall not be applied
to any Loan of a Defaulting Lender at any time when, and to the extent that,
the aggregate amount of Loans of any Non-Defaulting Lender exceeds such
Non-Defaulting Lenders' pro rata share of all Loans then outstanding.
(c) The Lenders shall participate in Letters of Credit on the basis
of their respective pro rata shares, and no participation or reimbursement
obligation of any Lender shall be increased as a result of a failure of any
Defaulting Lender to reimburse the Agent on the Letter of Credit Issuer's
behalf with respect to any amounts drawn on or otherwise payable with respect
to any Letters of Credit (the amount that any such Defaulting Lender has
failed to reimburse is hereinafter referred to as such Defaulting Lender's
"Unreimbursed Amount"). Until such Defaulting Lender has reimbursed the
Agent on the Letter of Credit Issuer's behalf for any Unreimbursed Amount
owed by it, all payments and other amounts received from any source with
respect to the Obligations or otherwise under or in connection with the
Agreement (including any letter of credit fees) which would otherwise be
payable to such Defaulting Lender will instead be paid to the Agent for the
benefit of the Letter of Credit Issuer for application to such Unreimbursed
Amount until such Unreimbursed Amount has been paid in full. A Defaulting
Lender shall not be entitled to receive any portion of the Commitment Fee,
the letter of credit fees or any other fees payable in connection with this
Agreement, or any indemnity arising from its commitment to make Loans and/or
participate in Letters of Credit.
(d) A Defaulting Lender shall not be entitled to give instructions to
the
Agent or to approve, disapprove, consent to or vote on any matters relating
to this Agreement and the Loan Documents. All amendments, waivers and other
modifications of this Agreement and the Loan Documents may be made without
regard to a Defaulting Lender and, for purposes of the definition of
"Required Lenders", a Defaulting Lender shall be deemed not to be a Lender,
not to have a Commitment, not to have a Term Commitment and not to have Loans
outstanding.
(e) Other than as expressly set forth in this Section 11.15, the
rights and obligations of a Defaulting Lender (including the obligation to
indemnify the Agent) and the other parties hereto shall remain unchanged.
Nothing in this Section 11.15 shall be deemed to release any Defaulting
Lender from its Commitment hereunder, shall alter such Commitment, shall
operate as a waiver of any default by such Defaulting Lender hereunder, or
shall prejudice any rights which the Borrowers, the Agent or any Lender may
have against any Defaulting Lender as a result of any default by such
Defaulting Lender hereunder.
(f) In the event the Defaulting Lender is able to retroactively
cure to the satisfaction of the Agent and with the consent of the Borrowers
(which shall not be unreasonably withheld) the breach which caused a Lender
to become a Defaulting Lender, such Defaulting Lender shall upon notice to
Borrowers, no longer be a Defaulting Lender and shall be treated as a Lender
hereunder.
SECTION XI.16. LIMITATION OF LIABILITY. NO CLAIM MAY BE MADE BY
ANY BORROWER, ANY GUARANTOR, ANY SPECIFIED PERSON, OR ANY OTHER PERSON
AGAINST THE AGENT, ANY LENDER, FLEET CAPITAL CORPORATION, FLEET BANK, N.A. OR
THE AFFILIATES, DIRECTORS, OFFICERS, EMPLOYEES, ATTORNEYS OR AGENTS OF THE
AGENT, SUCH LENDER, FLEET CAPITAL CORPORATION OR FLEET BANK, N.A. FOR ANY
SPECIAL, INDIRECT OR CONSEQUENTIAL DAMAGES OR, TO THE FULLEST EXTENT
PERMITTED BY LAW, FOR ANY PUNITIVE DAMAGES IN RESPECT OF ANY CLAIM OR CAUSE
OF ACTION (WHETHER BASED ON CONTRACT, TORT, STATUTORY LIABILITY, OR ANY OTHER
GROUND) BASED ON, ARISING OUT OF OR RELATED TO ANY LOAN DOCUMENT OR THE
TRANSACTIONS CONTEMPLATED HEREBY OR ANY ACT, OMISSION OR EVENT OCCURRING IN
CONNECTION THEREWITH, AND EACH BORROWER (FOR ITSELF AND ON BEHALF OF EACH
GUARANTOR AND EACH SPECIFIED PERSON) HEREBY WAIVES, RELEASES AND AGREES NEVER
TO XXX UPON ANY CLAIM FOR ANY SUCH DAMAGES, WHETHER SUCH CLAIM NOW EXISTS OR
HEREAFTER ARISES AND WHETHER OR NOT IT IS NOW KNOWN OR SUSPECTED TO EXIST IN
ITS FAVOR.
XII. GUARANTEES
Each Guarantor unconditionally guarantees, as a primary obligor and
not
merely as a surety, jointly and severally with each other Guarantor, the due
and punctual payment of the principal of and interest on each of the Notes,
when and as due, whether at maturity, by acceleration, by notice of
prepayment or otherwise, and the due and punctual performance of all other
Obligations. Each Guarantor further agrees that the Obligations may be
extended and renewed, in whole or in part, without notice to or further
assent from it, and that it will remain bound upon its guarantee
notwithstanding any extension or renewal of any Obligations.
Each Guarantor waives presentment to, demand of payment from and
protest to the Borrowers of any of the Obligations, and also waives notice of
acceptance of its guarantee and notice of protest for nonpayment. The
obligations of a Guarantor hereunder shall not be affected by (a) the failure
of any Lender, the Letter of Credit Issuer or the Agent to assert any claim
or demand or to enforce any right or remedy against the Borrowers or any
other Guarantor under the provisions of this Agreement, the Notes or any of
the other Loan Documents or otherwise; (b) any rescission, waiver, amendment
or modification of any of the terms or provisions of this Agreement, the
Notes, any of the other Loan Documents, any guarantee or any other agreement;
(c) the release of any security held by the Agent for the Obligations or any
of them; or (d) the failure of any Lender, the Agent or the Letter of Credit
Issuer to exercise any right or remedy against any other Guarantor of the
Obligations.
Each Guarantor further agrees that its guarantee constitutes a
guarantee of payment when due and not of collection, and waives any right to
require that any resort be had by any Lender, the Agent or the Letter of
Credit Issuer to any security (including, without limitation, any Collateral)
held for payment of the Obligations or to any balance of any deposit account
or credit on the books of any Lender, the Agent or the Letter of Credit
Issuer in favor of any Borrower or any other person.
The obligations of each Guarantor hereunder shall not be subject to
any reduction, limitation, impairment or termination for any reason,
including, without limitation, any claim of waiver, release, surrender,
alteration or compromise, and shall not be subject to any defense or setoff,
counterclaim, recoupment or termination whatsoever by reason of the
invalidity, illegality or unenforceability of the Obligations or otherwise.
Without limiting the generality of the foregoing, the obligations of each
Guarantor hereunder shall not be discharged or impaired or otherwise affected
by the failure of the Agent, the Letter of Credit Issuer or any Lender to
assert any claim or demand or to enforce any remedy under this Agreement, the
Notes or under any other Loan Document, any guarantee or any other agreement,
by any waiver or modification of any provision thereof, by any default,
failure or delay, willful or otherwise, in the performance of the
Obligations, or by any other act or omission which may or might in any manner
or to any extent vary the risk of such Guarantor or otherwise operate as a
discharge of such Guarantor as a matter of law or equity.
Each Guarantor further agrees that its guarantee shall continue to
be
effective or be reinstated, as the case may be, if at any time payment, or
any part thereof, of principal of or interest on any Obligation is rescinded
or must otherwise be returned by the Agent, the Letter of Credit Issuer or
any Lender upon the bankruptcy or reorganization of any Borrower or otherwise.
Each Guarantor hereby subordinates all rights of subrogation against
any Borrower and its property and all rights of indemnification, contribution
and reimbursement from any Borrower and its property, in each case in
connection with this guarantee and any payments made hereunder, and
regardless of whether such rights arise by operation of law, pursuant to
contract or otherwise, to the prior payment in full in cash of all
Obligations.
IN WITNESS WHEREOF, the Borrowers, the Guarantors, the Agent and the
Lenders have caused this Agreement to be duly executed by their respective
authorized officers as of the day and year first above written.
JITNEY-JUNGLE STORES OF AMERICA, INC.,
as Borrower and as Guarantor
By:_____________________________
Name:
Title:
SOUTHERN JITNEY JUNGLE COMPANY,
as Borrower and as Guarantor
By:_____________________________
Name:
Title:
XxXXXXX- XXXXXX CO., INC.,
as Borrower and as Guarantor
By:_____________________________
Name:
Title:
JITNEY- JUNGLE BAKERY, INC.,
as Borrower and as Guarantor
By:_____________________________
Name:
Title:
PUMP AND SAVE, INC.,
as Borrower and as Guarantor
By:_____________________________
Name:
Title:
INTERSTATE JITNEY JUNGLE STORES, INC.,
as Borrower and as Guarantor
By:_____________________________
Name:
Title:
DELTA ACQUISITION CORPORATION,
as Borrower and as Guarantor
By:_____________________________
Name:
Title:
DELCHAMPS, INC.,
as Borrower and as Guarantor
By:_____________________________
Name:
Title:
SUPERMARKET CIGARETTE SALES, INC.,
as Guarantor
By:_____________________________
Name:
Title:
FLEET CAPITAL CORPORATION, as Agent
By:_____________________________
Name:
Title:
FLEET CAPITAL CORPORATION, as Lender
By:_____________________________
Name:
Title:
BTM CAPITAL CORPORATION, as Lender
By:_____________________________
Name:
Title:
XXXXXX FINANCIAL INC., as Lender
By:_____________________________
Name:
Title:
IBJ XXXXXXXX BUSINESS CREDIT CORP., as Lender
By:_____________________________
Name:
Title:
NATIONAL BANK OF CANADA,
a Canadian Chartered Bank, as Lender
By:_____________________________
Name:
Title:
NATIONAL CITY BANK, as Lender
By:_____________________________
Name:
Title:
DEUTSCHE FINANCIAL SERVICES HOLDING
CORPORATION, as Lender
By:_____________________________
Name:
Title:
DLJ CAPITAL FUNDING, INC., as Lender
By:_____________________________
Name:
Title:
DLJ CAPITAL FUNDING, INC., as
Documentation Agent
By:_____________________________
Name:
Title:
FLEET BANK, N.A., as a Letter of Credit
Issuer
By:_____________________________
Name:
Title:
SCHEDULE II
FISCAL REPORTING PERIODS OF THE BORROWERS
FISCAL FY FY FY FY FY FY FY
MONTH 1998 1999 2000 2001 2002 2003 2004
------- -------- -------- -------- -------- -------- -------- --------
1 5/31/97 5/30/98 5/29/99 5/27/00
2 6/28/97 6/27/98 6/26/99 6/24/00
3 7/26/97 7/25/98 7/24/99 7/22/00
4 8/23/97 8/22/98 8/21/99 8/19/00
5 9/20/97 9/19/98 9/18/99 9/16/00
61 10/18/97 10/17/98 10/16/99 10/14/00
7 11/15/97 11/14/98 11/13/99 11/11/00
8 12/13/97 12/12/98 12/11/99 12/9/00
91 1/10/98 1/9/99 1/8/00 1/6/01
10 2/10/98 2/6/99 2/5/00 2/3/01
11 3/7/98 3/6/99 3/4/00 3/3/01
12 4/4/98 4/3/99 4/1/00 3/31/01
13 5/2/98 5/1/99 4/29/00 4/28/01
TABLE OF CONTENTS
PAGE
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I. DEFINITIONS 2
IA. AMENDMENT AND RESTATEMENT OF CREDIT AGREEMENT 21
SECTION 1A.01. (a) Existing Loans and Existing Letters of Credit. 21
II. THE LOANS 23
SECTION 2.01. Commitments 23
SECTION 2.02. Loans 24
SECTION 2.03. Notice of Loans 26
SECTION 2.04. Notes; Repayment of Loans 26
SECTION 2.05. Interest on Loans 27
SECTION 2.06. Fees 27
SECTION 2.07. Termination of Commitments and Commitment Reductions 27
SECTION 2.08. Interest on Overdue Amounts 30
SECTION 2.09. Prepayment of Loans 31
SECTION 2.10. Reserve Requirements; Change in Circumstances 35
SECTION 2.11. Change in Legality 37
SECTION 2.12. Indemnity 37
SECTION 2.13. Pro Rata Treatment 38
SECTION 2.14. Sharing of Setoffs 38
SECTION 2.15. Taxes 39
SECTION 2.16. Payments and Computations 41
SECTION 2.17. Settlement Among Lenders 41
SECTION 2.18. Making of Loans 44
SECTION 2.19. Joint and Several Borrowers 45
SECTION 2.20. Individual Borrowing and Letter of Credit Limit 45
IIA. LETTERS OF CREDIT 46
SECTION 2A.01. Issuance of Letters of Credit 46
SECTION 2A.02. Payment; Reimbursement 46
SECTION 2A.03. The Letter of Credit Issuer's Actions 48
SECTION 2A.04. Payments in Respect of Increased Costs 48
SECTION 2A.05. Indemnity as to Letters of Credit 50
SECTION 2A.06. Letter of Credit Fees 50
III. COLLATERAL SECURITY 51
SECTION 3.01. Security Documents 51
SECTION 3.02. Filing and Recording 51
SECTION 3.03. Real Property; Mortgages; Title Insurance 51
SECTION 3.04. Additional Collateral 53
IV. REPRESENTATIONS AND WARRANTIES 53
SECTION 4.01. Organization, Legal Existence 53
SECTION 4.02. Authorization 54
SECTION 4.03. Governmental Approvals 54
SECTION 4.04. Binding Effect 54
SECTION 4.05. Material Adverse Change 55
SECTION 4.06. Litigation; Compliance with Laws; etc. 55
SECTION 4.07. Financial Statements 55
SECTION 4.08. Federal Reserve Regulations 57
SECTION 4.09. Taxes 57
SECTION 4.10. Employee Benefit Plans 58
SECTION 4.11. No Material Misstatements 59
SECTION 4.12. Investment Company Act; Public Utility Holding
Company Act 59
SECTION 4.13. Security Interest 60
SECTION 4.14. Bank Accounts 60
SECTION 4.15. Capitalization 60
SECTION 4.16. Title to Properties; Possession Under Leases;
Trademarks 60
SECTION 4.17. Solvency 62
SECTION 4.18. Permits, etc. 63
SECTION 4.19. Compliance with Environmental Laws 63
SECTION 4.20. Material Agreements 64
SECTION 4.21. Acquisition 64
SECTION 4.22. The Tender Offer and Merger 65
SECTION 4.23. Broker's Fees 65
V. CONDITIONS OF CREDIT EVENTS 66
SECTION 5.01. All Credit Events 66
SECTION 5.02. Initial Closing Date 66
SECTION 5.03. Merger Closing Date 75
VI. AFFIRMATIVE COVENANTS 81
SECTION 6.01. Legal Existence 81
SECTION 6.02. Businesses and Properties 82
SECTION 6.03. Insurance 82
SECTION 6.04. Taxes 83
SECTION 6.05. Financial Statements, Reports, etc. 83
SECTION 6.06. Litigation and Other Notices 86
SECTION 6.07. ERISA 87
SECTION 6.08. Maintaining Records; Access to Properties and
Inspections; Right to Audit 88
SECTION 6.09. Fiscal Year-End 89
SECTION 6.10. Further Assurances 89
SECTION 6.11. Additional Grantors and Guarantors 89
SECTION 6.12. Environmental Laws 89
SECTION 6.13. Pay Obligations to Lenders and Perform Other
Covenants 91
SECTION 6.14. Maintain Operating Accounts 92
SECTION 6.15. Amendments 92
SECTION 6.16. Use of Proceeds 92
SECTION 6.17. Voting Control of Target Company; No Sale of
Stock, Etc 92
SECTION 6.18. Merger 92
VII. NEGATIVE COVENANTS 93
SECTION 7.01. Liens 93
SECTION 7.02. Sale and Lease-Back Transactions 94
SECTION 7.03. Indebtedness 94
SECTION 7.04. Dividends, Distributions and Payments 95
SECTION 7.05. Consolidations, Merger and Sales of Assets 95
SECTION 7.06. Investments 96
SECTION 7.07. Capital Expenditures and Other Expenditures 97
SECTION 7.08. Fixed Charge Coverage Ratio 97
SECTION 7.09. Leverage Ratio 97
SECTION 7.10. Interest Coverage Ratio 98
SECTION 7.11. EBITDA 98
SECTION 7.12. Interest Rate Protection Arrangements 99
SECTION 7.13. Business 99
SECTION 7.14. Sales of Receivables 99
SECTION 7.15. Use of Proceeds 99
SECTION 7.16. ERISA 99
SECTION 7.17. Accounting Changes 99
SECTION 7.18. Prepayment or Modification of Indebtedness;
Modification of Charter and Other Documents 100
SECTION 7.19. Transactions with Affiliates 100
SECTION 7.20. Consulting Fees 100
SECTION 7.21. Limitations on Dividends and Other Payments 101
SECTION 7.22. Limitation on Creation of Subsidiaries 101
SECTION 7.23. Limitation on Issuance of Capital Stock 101
SECTION 7.24. Conduct of Business by Target Company 101
VIII. EVENTS OF DEFAULT 103
IX. AGENT 110
X. CASH RECEIPTS COLLECTION 113
SECTION 10.01. Collection of Cash 113
SECTION 10.02. Monthly Statement of Account 114
SECTION 10.03. Collateral Custodian 115
XI. MISCELLANEOUS 115
SECTION 11.01. Notices 115
SECTION 11.02. Survival of Agreement 115
SECTION 11.03. Successors and Assigns; Participations 116
SECTION 11.04. Expenses; Indemnity 119
SECTION 11.05. Applicable Law 120
SECTION 11.06. Right of Setoff 120
SECTION 11.07. Payments on Business Days 120
SECTION 11.08. Waivers; Amendments; Final Maturity Date 121
SECTION 11.09. Severability 121
SECTION 11.10. Entire Agreement; Waiver of Jury Trial, etc. 122
SECTION 11.11. Confidentiality 122
SECTION 11.12. Submission to Jurisdiction 123
SECTION 11.13. Counterparts; Facsimile Signature 123
SECTION 11.14. Headings 123
SECTION 11.15. Defaulting Lender 123
SECTION 11.16. LIMITATION OF LIABILITY 125
XII. GUARANTEES 125
Exhibits and Schedules were typed in manually in Table of Contents and will
not be generated with the TOC.
EXHIBITS
EXHIBIT A Form of Note
EXHIBIT B Form of Opinion of Counsel
EXHIBIT C-1 Form of Pledge Agreement
EXHIBIT C-2 Form of Partnership Pledge Agreement
EXHIBIT D Form of Security Agreement
EXHIBIT E Form of Assignment and Acceptance
EXHIBIT F Form of Security Agreement--Patents and Trademarks
EXHIBIT G Form of Assignment of Contract
EXHIBIT H Form of Landlord Waiver
EXHIBIT I Form of Settlement Report
EXHIBIT J Form of Inventory Designation
EXHIBIT K-1 Form of Monthly Borrowing Base Certificate
EXHIBIT K-2 Form of Weekly Borrowing Base Certificate
SCHEDULES
SCHEDULE 2.01 Commitments
SCHEDULE 2.02 Domestic Lending Offices
SCHEDULE 2.03 Eurodollar Lending Offices
SCHEDULE 4.01 Qualified Jurisdictions
SCHEDULE 4.03 Consents
SCHEDULE 4.13 Filing Jurisdictions
SCHEDULE 4.14 List of Bank Accounts
SCHEDULE 4.15(a) Ownership of Jitney Jungle
SCHEDULE 4.15(b) Subsidiaries
SCHEDULE 4.16(a-1) Owned Real Property
SCHEDULE 4.16(a-2) Leased Real Property
SCHEDULE 4.18 Permits
SCHEDULE 4.20 Material Agreements
SCHEDULE 4.23 Broker's Fees
SCHEDULE 7.01 Existing Liens
SCHEDULE 7.03 Existing Indebtedness
SCHEDULE 7.20 Consulting Fees
SCHEDULE I Certain Investors
SCHEDULE II Fiscal Reporting Periods of the Borrowers
SCHEDULE III Maximum Retained Balance in each Blocked Account
SCHEDULE IV Outstanding Letters of Credit
SCHEDULE V FTC Divestiture Stores
------------------------
(1) Also, Fiscal Quarter-End.
(2) Also, Fiscal Quarter-End and Fiscal Year-End.
