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SECOND AMENDED AND RESTATED
CREDIT AGREEMENT
dated as of
May 12, 1999
between
CANANDAIGUA BRANDS, INC.
The SUBSIDIARY GUARANTORS Party Hereto
The LENDERS Party Hereto
and
THE CHASE MANHATTAN BANK,
as Administrative Agent
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$1,200,000,000
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CHASE SECURITIES INC.,
as Lead Arranger and Book Manager
THE BANK OF NOVA SCOTIA,
as Syndication Agent
CREDIT SUISSE FIRST BOSTON
and
FLEET NATIONAL BANK,
as Co-Documentation Agents
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SECOND AMENDED AND RESTATED CREDIT AGREEMENT
SECOND AMENDED AND RESTATED CREDIT AGREEMENT dated as of May
12, 1999, between CANANDAIGUA BRANDS, INC., a Delaware corporation (the
"Borrower"), the SUBSIDIARY GUARANTORS party hereto, the LENDERS party hereto,
and THE CHASE MANHATTAN BANK, a New York State banking corporation ("Chase"), as
administrative agent for said Lenders (in such capacity, together with its
successors in such capacity, the "Administrative Agent").
The Borrower, the Subsidiary Guarantors party hereto, the
Lenders party hereto, and the Administrative Agent are party to a First Amended
and Restated Credit Agreement dated as of November 2, 1998 (said First Amended
and Restated Credit Agreement, as in effect on the date hereof immediately
before giving effect to the amendment and restatement contemplated hereby, being
herein called the "Existing Credit Agreement"), providing for extensions of
credit (by means of loans and letters of credit) to be made by said Lenders to
the Borrower in an original aggregate principal or face amount not exceeding
$1,000,000,000, which amount may, in the circumstances therein provided, be
increased to $1,200,000,000.
The parties hereto now wish to amend the Existing Credit
Agreement in certain respects to provide for certain modifications to the
Existing Credit Agreement and, as so amended, to restate the Existing Credit
Agreement in its entirety, the modifications to be effected pursuant to this
Second Amended and Restated Credit Agreement requiring only the consent of the
"Required Lenders" under and as defined in the Existing Credit Agreement.
Accordingly, the parties hereto hereby agree that the Existing Credit Agreement
shall, subject to the execution and delivery of this Second Amended and Restated
Credit Agreement by each of the intended parties hereto, but with effect as of
the date hereof, be amended and restated to read in its entirety as set forth in
the Existing Credit Agreement, which is hereby incorporated herein by reference,
with the amendments set forth in Article II below (as so amended and restated,
the "Credit Agreement"):
ARTICLE I
Definitions
Except as used in the definitions set forth in Article II
below, references to "hereby," "herein," "hereof" and "herewith" refer to this
Second Amended and Restated Credit Agreement and not to the Existing Credit
Agreement. Capitalized terms used but not otherwise defined herein have the
meanings given them in the Credit Agreement.
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ARTICLE II
Amendments
Subject to the satisfaction or waiver of the conditions
precedent set forth in Article IV of this Second Amended and Restated Credit
Agreement, but effective as of the date hereof, the Existing Credit Agreement is
hereby amended as follows:
SECTION 2.01. References to "Existing Credit Agreement".
References in the Existing Credit Agreement to "this Agreement" (including
indirect references) shall be deemed to be references to the Credit Agreement.
SECTION 2.02. Definitions. Section 1.01 of the Existing Credit
Agreement is amended by adding the following new definitions (to the extent not
already included in said Section 1.01) and inserting the same in the appropriate
alphabetical locations and amending in their entirety the following definitions
(to the extent already included in said Section 1.01) to read in their entirety
as follows:
"Agreement" shall mean, on any date from and after the Second
Restatement Effective Date, this Agreement as in effect on the Second
Restatement Effective Date and as thereafter from time to time amended,
supplemented, amended and restated, or otherwise modified and in effect
on such date.
"Applicable Percentage" means (a) with respect to any Tranche
I Revolving Lender for purposes of Sections 2.05 or 2.06 or Article
VIII, the percentage of the total Tranche I Revolving Commitments
represented by such Tranche I Revolving Lender's Tranche I Revolving
Commitment, (b) with respect to any Tranche II Revolving Lender for
purposes of Section 2.06 or Article VIII, the percentage of the total
Tranche II Revolving Commitments represented by such Tranche II
Revolving Lender's Tranche II Revolving Commitment, (c) with respect to
any Revolving Lender in respect of any indemnity claim under Section
10.03(c) arising out of an action or omission of the Administrative
Agent, the Swingline Lender or the Issuing Lender under this Agreement
relating to Swingline Loans or Letters of Credit, the percentage of the
total Revolving Commitments of the applicable Class represented by such
Revolving Lender's Revolving Commitments of such Class and (d) with
respect to any Lender in respect of any indemnity claim under Section
10.03(c) arising out of an action or omission of the Administrative
Agent under this Agreement (other than one relating to Swingline Loans
or Letters of Credit), the percentage of the total Commitments or Loans
of all Classes hereunder represented by the aggregate amount of such
Lender's Commitments or Loans of all Classes hereunder. If the Tranche
I Revolving Commitments or Tranche II Revolving Commitments have
terminated or expired, the Applicable Percentages shall be determined
based upon the Tranche I Revolving Commitments or Tranche II Revolving
Commitments, as applicable, most recently in effect (and giving effect
to any assignments).
"Applicable Rate" means, for any day, with respect to any ABR
Borrowing (including any Swingline ABR Borrowing), Syndicated
Eurocurrency Borrowing,
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Swingline FFBR Borrowing or Swingline Eurocurrency Borrowing, or with
respect to the facility fees or commitment fees payable hereunder, as
the case may be, the rate per annum set forth in the schedule below,
as applicable, based upon the Debt Ratio as of the most recent
determination date, provided that prior to the Second Restatement
Effective Date, the Applicable Rate for any Borrowing shall not be
lower than the rates set forth below for Category 2 and on and after
the Second Restatement Effective Date through the later of November
30, 1999 and the payment in full of the Tranche II Term Loans, the
Applicable Rate for any Borrowing shall not be lower than the rates
set forth below for Category 1:
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DEBT RATIO: REVOLVING AND TRANCHE I AND II INCREMENTAL FACILITY
SWINGLINE LOANS TERM LOANS AND
TRANCHE III
TERM LOANS
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------------------------------------------------------------------------------------------------
ABR RATE EURO-CURRENCY ABR EURO-CURRENCY ABR EURO-CURRENCY FACILITY/
AND RATE RATE RATE RATE COMMITMENT
SWINGLINE FEE RATE
FFBR RATE
------------------------------------------------------------------------------------------------
Category 1
4.00x 1.000 2.000 1.500 2.500 1.750 2.750 0.500
------------------------------------------------------------------------------------------------
Category 2
< 4.00x and 0.750 1.750 1.250 2.250 1.500 2.500 0.500
= 3.65x
------------------------------------------------------------------------------------------------
Category 3
< 3.65x and 0.500 1.500 1.000 2.000 1.500 2.500 0.500
= 3.00x
------------------------------------------------------------------------------------------------
Category 4
< 3.00x and 0.375 1.375 0.750 1.750 1.500 2.500 0.375
= 2.50x
------------------------------------------------------------------------------------------------
Category 5
< 2.50x 0.125 1.125 0.500 1.500 1.500 2.500 0.375
------------------------------------------------------------------------------------------------
For purposes of the foregoing, (i) the Debt Ratio shall be
determined as of the end of each fiscal quarter of the Borrower's
fiscal year based upon the Borrower's consolidated financial statements
delivered pursuant to Section 6.01(a) or (b) (or, prior to the first
such delivery, referred to in Section 4.04(a)(iii)), and (ii) subject
to the foregoing provisions of this definition, each change in the
Applicable Rate resulting from a change in the Debt Ratio shall be
effective during the period commencing on and including the date three
Business Days after delivery to the Administrative Agent of such
consolidated financial statements indicating such change and ending on
the date immediately preceding the effective date of the next such
change; provided that the Debt Ratio shall be deemed to be in Category
1 (A) at any time that an Event of Default has occurred and is
continuing and (B) if the Borrower fails to deliver the consolidated
financial statements required to be delivered by it pursuant to Section
6.01(a) or (b), during the period from the expiration of the time for
delivery thereof until such consolidated financial statements are
delivered.
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"Debt Ratio" means, as at the last day of any fiscal quarter
of the Borrower (the "day of determination"), the ratio of (a) the
average of the aggregate amounts of Indebtedness of the Borrower and
its Consolidated Subsidiaries (determined on a consolidated basis,
without duplication, in accordance with GAAP) as at such day and as at
the last days of each of the three immediately preceding fiscal
quarters to (b) Operating Cash Flow for the period of four consecutive
fiscal quarters ending on such day of determination.
Notwithstanding the foregoing, (i) Indebtedness as at the last
day of each fiscal quarter included in the determination of average
Indebtedness pursuant to clause (a) above shall be determined under the
assumption that any prepayment of Term Loans hereunder from the
proceeds of any Equity Issuance at any time during any such fiscal
quarter included in the calculation thereof shall have been made in the
first such fiscal quarter, (ii) for the last day of any fiscal quarter
ending prior to the end of the Term Loan Availability Period, the
average Indebtedness specified in clause (a) above shall be increased
by an amount equal to the aggregate principal amount of Loans that
would be required to be borrowed under this Agreement to finance in
full the acquisition by U.K. Acquisition of all of the Target Shares
pursuant to the Tender Offer and the repayment in full of all
Indebtedness outstanding under the Target Credit Facilities (but
without duplication of (x) any Loans actually outstanding under this
Agreement on such date and applied to such purpose and (y) any
Indebtedness outstanding under the Target Credit Facilities on such
date), (iii) for purposes of determining Operating Cash Flow pursuant
to clause (b) above for any period ending on or prior to the end of the
Term Loan Availability Period, the Target and its Subsidiaries shall in
any event be deemed to be Consolidated Subsidiaries of the Borrower and
(iv) if during the period of four fiscal quarters ending on the day of
determination the Borrower shall have consummated any Acquisition or
Disposition (other than the Tender Offer) for aggregate consideration
of $10,000,000 or more then the average Indebtedness as at the last day
of each fiscal quarter in such period shall be determined on a pro
forma basis by adding (in the case of an Acquisition), without
duplication of amounts already included, the amount of Indebtedness
incurred or assumed by the Borrower or any of its Subsidiaries in
connection with such Acquisition and subtracting (in the case of a
Disposition), without duplication of amounts already excluded, the
amount of Indebtedness repaid in connection with such Disposition.
"Existing Credit Agreement" shall have the meaning assigned to
such term in the preamble to the Second Amended and Restated Credit
Agreement.
"Franciscan Acquisition" means the acquisition by the
Borrower, directly or indirectly through one or more Wholly Owned
Subsidiaries, of the shares of stock of Franciscan Vineyards, Inc.,
together with certain related assets, pursuant to the Franciscan
Acquisition Agreement.
"Franciscan Acquisition Agreement" means the Stock Purchase
Agreement dated as of April 21, 1999 between Franciscan Vineyards,
Inc., the Sellers referred to therein and the Borrower.
-5-
"Incremental Facility Commitment" means, with respect to each
Lender, the commitment, if any, of such Lender to make Incremental
Facility Loans, expressed as an amount representing the maximum
aggregate amount of such Lender's Incremental Facility Exposure
hereunder, as such commitment may be (a) reduced from time to time
pursuant to Section 2.09 or 2.11 and (b) reduced or increased from time
to time pursuant to assignments by or to such Lender pursuant to
Section 10.04. The initial amount of each Lender's Incremental Facility
Commitment is set forth on such Lender's signature page of the
Incremental Facility Loan Agreement, or in the Assignment and
Acceptance pursuant to which such Lender shall have assumed its
Incremental Facility Commitment, as applicable. The initial amount of
each Lender's Incremental Facility Commitments shall be determined in
accordance with the provisions of Section 2.01(c).
"Incremental Facility Exposure" means, with respect to any
Lender at any time, the outstanding principal amount of such Lender's
Incremental Facility Loans.
"Incremental Facility Lenders" means a Lender with an
Incremental Facility Commitment or, if the Incremental Facility
Commitments have terminated or expired, a Lender with Incremental
Facility Exposure.
"Incremental Facility Loan" means an "Incremental Facility
Loan" provided for by Section 2.01(c), which may be ABR Loans and/or
Eurocurrency Loans.
"Incremental Facility Loan Agreement" means, with respect to
any Series of Incremental Facility Loans, an agreement between the
Borrower and one or more Lenders pursuant to which each such Lender
agrees to become obligated in respect of an Incremental Facility
Commitment of such Series hereunder.
"Interest Expense" means, for any period, the sum, for the
Borrower and its Consolidated Subsidiaries (determined on a
consolidated basis without duplication in accordance with GAAP), of the
following: (a) all interest in respect of Indebtedness (including the
interest component of any payments in respect of Capital Lease
Obligations) accrued or capitalized during such period (whether or not
actually paid during such period) plus (b) the net amounts payable (or
minus the net amounts receivable) under Interest Rate Protection
Agreements accrued during such period (whether or not actually paid or
received during such period) minus (c) all interest income during such
period.
Notwithstanding the foregoing, if during any period for which
Interest Expense is being determined the Borrower shall have
consummated any Acquisition or Disposition for aggregate consideration
of $10,000,000 or more then, for all purposes of this Agreement (other
than for purposes of the definition of Excess Cash Flow), Interest
Expense shall be determined on a pro forma basis as if such Acquisition
or Disposition (and any Indebtedness incurred by the Borrower or any of
its Subsidiaries in connection with such Acquisition or repaid as a
result of such Disposition) had been made or consummated (and such
Indebtedness incurred or repaid) on the first day of such period (and
interest on any such Indebtedness shall be deemed to be calculated for
such period at
-6-
a rate per annum equal to the actual rate of interest in effect in
respect of Indebtedness under this Agreement outstanding during such
period).
"Operating Cash Flow" means, for any period, the sum, for the
Borrower and its Consolidated Subsidiaries (determined on a
consolidated basis without duplication in accordance with GAAP), of the
following: (a) net operating income (calculated before income taxes,
interest income, Interest Expense, extraordinary and unusual items and
income or loss attributable to equity in Affiliates) for such period
plus (b) depreciation and amortization (to the extent deducted in
determining net operating income) for such period plus (c) the
Adjustment Amount for such period, if such Adjustment Amount is expense
(or minus the Adjustment Amount for such period, if such Adjustment
Amount is income) plus (d) unusual non-recurring charges against net
operating income of the Target and its Subsidiaries described on
Schedule IX hereto (as such Schedule may be amended from time to time
with the consent of the Borrower and the Required Lenders).
Notwithstanding the foregoing, if during any period for which
Operating Cash Flow is being determined the Borrower or any of its
Subsidiaries shall have consummated any Acquisition or Disposition for
aggregate consideration of $10,000,000 or more then, for all purposes
of this Agreement (other than for purposes of determining Excess Cash
Flow), Operating Cash Flow shall be determined on a pro forma basis as
if such Acquisition or Disposition had been made or consummated on the
first day of such period.
"Revolving Commitments" means, collectively, the Tranche I
Revolving Commitments and the Tranche II Revolving Commitments.
"Revolving Lenders" means, collectively, the Tranche I
Revolving Lenders and the Tranche II Revolving Lenders.
"Revolving Loans" means, collectively, the Tranche I Revolving
Loans and the Tranche II Revolving Loans.
"Second Amended and Restated Credit Agreement" shall mean that
certain Second Amended and Restated Credit Agreement, between the
Borrower, the Subsidiary Guarantors, the Lenders and the Administrative
Agent, dated as of May 12, 1999.
"Second Restatement Effective Date" shall mean the date upon
which each of the conditions precedent set forth in Article IV of the
Second Amended and Restated Credit Agreement shall have been satisfied
or waived.
"Senior Debt Ratio" means, as at the last day of any fiscal
quarter of the Borrower (the "day of determination"), the ratio of (a)
the average of the aggregate amounts of Indebtedness (other than any
Subordinated Indebtedness) of the Borrower and its Consolidated
Subsidiaries (determined on a consolidated basis, without duplication,
in accordance with GAAP) as at such day and as at the last days of each
of the three immediately preceding fiscal quarters to (b) Operating
Cash Flow for the period of four consecutive fiscal quarters ending on
such day of determination.
-7-
Notwithstanding the foregoing, (i) Indebtedness as at the last
day of each fiscal quarter included in the determination of average
Indebtedness pursuant to clause (a) above shall be determined under the
assumption that any prepayment of Term Loans hereunder from the
proceeds of any Equity Issuance or Debt Incurrence at any time during
any such fiscal quarter included in the calculation thereof shall have
been made in the first such fiscal quarter, (ii) for the last day of
any fiscal quarter ending prior to the end of the Term Loan
Availability Period, the average Indebtedness specified in clause (a)
above shall be increased by an amount equal to the aggregate principal
amount of Loans that would be required to be borrowed under this
Agreement to finance in full the acquisition by U.K. Acquisition of all
of the Target Shares pursuant to the Tender Offer and the repayment in
full of all Indebtedness outstanding under the Target Credit Facilities
(but without duplication of (x) any Loans actually outstanding under
this Agreement on such date and applied to such purpose and (y) any
Indebtedness outstanding under the Target Credit Facilities on such
date), (iii) for purposes of determining Operating Cash Flow pursuant
to clause (b) above for any period ending on or prior to the end of the
Term Loan Availability Period, the Target and its Subsidiaries shall in
any event be deemed to be Consolidated Subsidiaries of the Borrower,
(iv) if during the period of four fiscal quarters ending on the day of
determination the Borrower shall have consummated any Acquisition or
Disposition (other than the Tender Offer) for aggregate consideration
of $10,000,000 or more then the average Indebtedness as at the last day
of each fiscal quarter in such period shall be determined on a pro
forma basis by adding (in the case of an Acquisition), without
duplication of amounts already included, the amount of Indebtedness
(other than Subordinated Indebtedness) incurred or assumed by the
Borrower or any of its Subsidiaries in connection with such Acquisition
and subtracting (in the case of a Disposition), without duplication of
amounts already excluded, the amount of Indebtedness (other than
Subordinated Indebtedness) repaid in connection with such Disposition
and (v) if during the period of four fiscal quarters ending on the day
of determination the Borrower shall have repaid any Indebtedness (other
than Subordinated Indebtedness) from the proceeds of Subordinated
Indebtedness, then the average Indebtedness as at the last day of each
fiscal quarter in such period shall be determined on a pro forma basis
by subtracting, without duplication of amounts already excluded, the
amount of such Indebtedness so repaid from the proceeds of Subordinated
Indebtedness.
SECTION 2.03. Deletion and Modification of Certain
Definitions. The definitions of "Tranche III Revolving Commitment", "Tranche III
Revolving Exposure", "Tranche III Revolving Lenders", "Tranche III Revolving
Loan" and "Tranche III Revolving Loan Agreement" are hereby deleted from Section
1.01 of the Existing Credit Agreement, and any reference to any of such terms in
the Existing Credit Agreement is hereby amended to be a reference to
"Incremental Facility Commitment", "Incremental Facility Exposure", "Incremental
Facility Lenders", "Incremental Facility Loan" and "Incremental Facility Loan
Agreement", respectively.
-8-
SECTION 2.04. Incremental Facility Loans. Section 2.01(c) of
the Existing Credit Agreement is hereby amended to read in its entirety as
follows:
"(c) Incremental Facility Loans. In addition to borrowings of
Tranche I Revolving Loans and Tranche II Revolving Loans specified in
Section 2.01(a) and (b), respectively, at any time and from time to
time on or before November 30, 1999, the Borrower may request that the
Lenders offer to enter into commitments to make Incremental Facility
Loans to the Borrower in Dollars (it being understood that such offer
may be made by any financial institution that is to become a Lender
hereunder in connection with the making of such offer under this
paragraph (c), so long as the Administrative Agent shall have consented
to such financial institution being a Lender hereunder (such consent
shall not be unreasonably withheld)). In the event that one or more of
the Lenders offer, in their sole discretion, to enter into such
commitments, and such Lenders and the Borrower agree as to the amount
of such commitments that shall be allocated to the respective Lenders
making such offers and as to the fees (if any) to be payable by the
Borrower in connection therewith, the Borrower, the Administrative
Agent and such Lenders shall execute and deliver an Incremental
Facility Loan Agreement and such Lenders shall become obligated to make
Incremental Facility Loans under this Agreement in an amount equal to
the amount of their respective Incremental Facility Commitments, as
specified in such Incremental Facility Loan Agreement. The Incremental
Facility Loans to be made pursuant to any Incremental Facility Loan
Agreement in response to any such request by the Borrower shall be
deemed to be a separate "Series" of Incremental Facility Loans for all
purposes of this Agreement.
Anything herein to the contrary notwithstanding, (i) the
minimum aggregate principal amount of Incremental Facility Commitments
entered into pursuant to any request specified above (and, accordingly,
the minimum aggregate principal amount of any Series of Incremental
Facility Loans) shall be $50,000,000 and (ii) the aggregate outstanding
principal amount of Incremental Facility Loans of all Series, together
with the aggregate unutilized Incremental Facility Commitments of all
Series, shall not exceed $200,000,000 at any time.
Following agreement by the Borrower and one or more of the
Lenders as provided above, subject to the terms and conditions set
forth herein, each Incremental Facility Lender of any Series agrees to
make Incremental Facility Loans of such Series to the Borrower as
specified in the Incremental Facility Loan Agreement, in Dollars in an
aggregate principal amount up to but not exceeding the amount of the
Incremental Facility Commitment of such Series of such Incremental
Facility Lender. Amounts repaid in respect of Incremental Facility
Loans may not be reborrowed. Incremental Facility Loans shall be made
as ABR Loans and Eurocurrency Loans available in Dollars only, and
shall not be available as Competitive Loans or Swingline Loans, nor
shall the Incremental Facility Commitments be available for the
issuance of Letters of Credit."
-9-
SECTION 2.05. Conversions and Continuations. Section 2.02(d)
of the Existing Credit Agreement
is hereby amended to read in its entirety as follows:
"(d) Conversion or Continuation of Eurocurrency Loans.
Notwithstanding any other provision of this Agreement, the Borrower
shall not be entitled to request, or to elect to convert to or continue
as a Syndicated Eurocurrency Borrowing: (i) any Revolving Borrowing or
Competitive Borrowing if the Interest Period requested with respect
thereto would end after the Revolving Commitment Termination Date; or
(ii) any Term Loan Borrowing of any Class, or any Incremental Facility
Loan of any Series, if the Interest Period requested with respect
thereto would commence before and end after any Term Loan Principal
Payment Date unless, after giving effect thereto, the aggregate
principal amount of the Tranche I Term Loans, Tranche II Term Loans,
Tranche III Term Loans or Incremental Facility Loans of such Series, as
the case may be, having Interest Periods that end after such Term Loan
Principal Payment Date shall be equal to or less than the aggregate
principal amount of the Tranche I Term Loans, Tranche II Term Loans,
Tranche III Term Loans or Incremental Facility Loans of such Series,
respectively, permitted to be outstanding after giving effect to the
payments of principal required to be made on such Term Loan Principal
Payment Date."
SECTION 2.06. Notices of Borrowings. Clause (i) of Section
2.03 of the Existing Credit Agreement is hereby amended to read in its entirety
as follows:
"(i) whether the requested Borrowing is to be a Tranche I
Revolving Borrowing, Tranche II Revolving Borrowing, Incremental
Facility Borrowing, Tranche I Term Loan Borrowing, Tranche II Term Loan
Borrowing or Tranche III Term Loan Borrowing;"
SECTION 2.07. Competitive Bid Loans. The first sentence of
Section 2.04(a) of the Existing Credit Agreement is hereby amended to read in
its entirety as follows:
"Subject to the terms and conditions set forth herein, from
time to time during the Revolving Availability Period the Borrower may
request Competitive Bids and may (but shall not have any obligation to)
accept Competitive Bids and borrow Competitive Loans denominated in
Dollars or Sterling; provided that (i) the sum of the total Tranche I
Revolving Exposures plus the aggregate principal amount of outstanding
Competitive Loans made by Tranche I Revolving Lenders at any time shall
not exceed the total Tranche I Revolving Commitments, (ii) the sum of
the total Tranche II Revolving Exposures plus the aggregate principal
amount of outstanding Competitive Loans made by Tranche II Revolving
Lenders at any time shall not exceed the total Tranche II Revolving
Commitments and (iii) the sum of the aggregate principal amount of
outstanding Tranche II Revolving Loans and Competitive Loans
denominated in Sterling at any time shall not exceed
(pound)50,000,000."
-10-
SECTION 2.08. Letters of Credit. Section 2.06(c) of the
Existing Credit Agreement is hereby amended to read in its entirety as follows:
"(c) Limitations on Amounts. A Letter of Credit shall be
issued, amended, renewed or extended only if (and upon issuance,
amendment, renewal or extension of each Letter of Credit the Borrower
shall be deemed to represent and warrant that), after giving effect to
such issuance, amendment, renewal or extension (i) the aggregate LC
Exposure of Chase, as an Issuing Lender (determined for these purposes
without giving effect to the participations therein of the Revolving
Lenders pursuant to paragraph (e) of this Section), shall not exceed
$20,000,000, (ii) the aggregate LC Exposure of First Chicago, as an
Issuing Lender (determined for these purposes without giving effect to
the participations therein of the Revolving Lenders pursuant to
paragraph(e) of this Section), shall not exceed the Qingdao Letter of
Credit Limit, (iii) the sum of the total Tranche I Revolving Exposures
plus the aggregate principal amount of outstanding Competitive Loans
made by Tranche I Revolving Lenders shall not exceed the total Tranche
I Revolving Commitments and (iv) the sum of the total Tranche II
Revolving Exposures plus the aggregate principal amount of outstanding
Competitive Loans made by Tranche II Revolving Lenders shall not exceed
the total Tranche II Revolving Commitments."
SECTION 2.09. Termination of Commitments. Section 2.09(a) of
the Existing Credit Agreement is hereby amended to read in its entirety as
follows:
"(a) Scheduled Termination. Unless previously terminated, (i)
the Tranche I Term Loan Dollar Commitments, the Tranche I Term Loan
Sterling Commitments and the Tranche II Term Loan Commitments shall
terminate at 5:00 p.m. on the last day of the Term Loan Availability
Period, (ii) the Tranche III Term Loan Commitments shall terminate at
5:00 p.m., New York City time, on the Initial Funding Date, (iii) the
Revolving Commitments shall terminate on the Revolving Commitment
Termination Date and (iv) the Incremental Facility Commitments of any
Series shall terminate immediately after the making of the Incremental
Facility Loans of such Series."
SECTION 2.10. Repayment of Incremental Facility Loans. Section
2.10(a) of the Existing Credit Agreement is hereby amended by deleting the "and"
at the end of clause (v), replacing the period at the end of clause (vi) with ",
and" and adding a new clause (vii) to read as follows:
"(vii) to the Administrative Agent for account of the
Incremental Facility Lenders the outstanding principal amount of the
Incremental Facility Loans of any Series on each Term Loan Principal
Payment Date set forth below in an aggregate principal amount equal to
the percentage of the original principal amount of the Incremental
Facility Loans of such Series set forth opposite such Term Loan
Principal Payment Date:
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Term Loan
Principal Payment Date Amount (%)
December 1, 1999 .25
March 1, 2000 .25
June 1, 2000 .25
September 1, 2000 .25
December 1, 2000 .25
March 1, 2001 .25
June 1, 2001 .25
September 1, 2001 .25
December 1, 2001 .25
March 1, 2002 .25
June 1, 2002 .25
September 1, 2002 .25
December 1, 2002 .25
March 1, 2003 .25
June 1, 2003 .25
September 1, 2003 .25
December 1, 2003 .25
March 1, 2004 11.96875
June 1, 2004 11.96875
September 1, 2004 11.96875
December 1, 2004 11.96875
March 1, 2005 11.96875
June 1, 2005 11.96875
September 1, 2005 11.96875
December 1, 2005 11.96875"
SECTION 2.11. Mandatory Prepayments. Clause "second" of
Section 2.11(b)(vi)(A) of the Existing Credit Agreement is hereby amended to
read in its entirety as follows:
"second, after the payment in full of any then-outstanding
Term Loans of any Class, to prepay Revolving Loans (without reduction
of Revolving Commitments) and Incremental Facility Loans, in each case
ratably in accordance with the respective principal amounts thereof."
-12-
SECTION 2.12. Mandatory Prepayments. Clause "second" of
Section 2.11(b)(vi)(B) of the Existing Credit Agreement is hereby amended to
read in its entirety as follows:
"second, after the payment in full of any then-outstanding
Term Loans of any Class, to prepay Revolving Loans (without reduction
of Revolving Commitments) and Incremental Facility Loans, in each case
ratably in accordance with the respective principal amounts thereof."
SECTION 2.13. Pro Rata Treatment. Section 2.18(c) of the
Existing Credit Agreement is hereby amended to read in its entirety as follows:
"(c) Pro Rata Treatment. Except to the extent otherwise
provided herein (including in Section 2.10(a)(ii)): (i) each Syndicated
Borrowing of a particular Class shall be made from the relevant
Lenders, each payment of facility fee and commitment fee under Section
2.12 in respect of Commitments of a particular Class shall be made for
account of the relevant Lenders, and each termination or reduction of
the amount of the Commitments of a particular Class under Section 2.09
shall be applied to the respective Commitments of such Class of the
relevant Lenders, pro rata according to the amounts of their respective
Commitments of such Class; (ii) each Syndicated Borrowing of any Class
shall be allocated pro rata among the relevant Lenders according to the
amounts of their respective Commitments of such Class (in the case of
the making of Syndicated Loans) or their respective Loans of such Class
(in the case of conversions and continuations of Loans); (iii) each
payment or prepayment of principal of Revolving Loans, Incremental
Facility Loans of any Series, Tranche I Term Loans, Tranche II Term
Loans and Tranche III Term Loans by the Borrower shall be made for
account of the relevant Lenders pro rata in accordance with the
respective unpaid principal amounts of the Syndicated Loans of such
Class or Series held by them; and (iv) each payment of interest on
Revolving Loans, Incremental Facility Loans of any Series, Tranche I
Term Loans, Tranche II Term Loans and Tranche III Term Loans by the
Borrower shall be made for account of the relevant Lenders pro rata in
accordance with the amounts of interest on such Loans then due and
payable to the respective Lenders."
SECTION 2.14. Section 6.08 of the Existing Credit Agreement is
amended by adding a new sentence at the end thereof to read as follows:
"The proceeds of the Incremental Facility Loans of any Series
will be used to finance acquisitions (including the Franciscan
Acquisition) and related fees and expenses."
-13-
SECTION 2.15. Paragraphs (a) and (c) of Section 7.08 of the
Existing Credit Agreement are hereby amended to read in their entirety as
follows, respectively:
"(a) Debt Ratio. The Borrower will not permit the Debt Ratio
to exceed the following respective ratios at any time during the
following respective periods:
Period Ratio
-------------------- -----------
From the date hereof
through August 31, 2000 4.75 to 1
From September 1, 2000
through August 31, 2001 4.50 to 1
From September 1, 2001
and at all times thereafter 4.00 to 1
(c) Interest Coverage Ratio. The Borrower will not permit the
Interest Coverage Ratio to be less than the following respective ratios
at any time during the following respective periods:
Period Ratio
-------------------- -----------
From the date hereof
through February 29, 2000 2.25 to 1
From March 1, 2000
through February 28, 2001 2.50 to 1
From March 1, 2001
through February 28, 2002 2.75 to 1
From March 1, 2002
and at all times thereafter 3.00 to 1"
-14-
ARTICLE III
Representations and Warranties
The Borrower hereby represents and warrants to the Lenders (i)
as of the date hereof and (ii) as of the Second Restatement Effective Date (as
defined in Article II hereof), after giving effect to the Second Amended and
Restated Credit Agreement, that:
(i) no Default has occurred and is continuing;
(ii) each of the representations and warranties of the
Borrowers in Article IV of the Existing Credit Agreement and in the
other Loan Documents are true and complete on the date hereof, with the
same force and effect as if made on and as of the date hereof (or, if
any such representation or warranty is expressly stated to have been
made as of a specific date, as of such specific date), as if each
reference in said Article IV or in each such Loan Document to "this
Agreement" included reference to this Second Amended and Restated
Credit Agreement; and
(iii) the Borrower has heretofore delivered to the
Administrative Agent a true and complete copy of the Franciscan
Acquisition Agreement (including any modifications and supplements
thereto, and any schedules delivered thereunder) as in effect on the
date hereof.
ARTICLE IV
Conditions Precedent
The amendments set forth in Article II hereof shall become
effective on the date upon which each of the following conditions precedent
shall have been fulfilled to the satisfaction of the Administrative Agent:
SECTION 4.01. Execution by All Parties. This Second Amended
and Restated Credit Agreement shall have been executed and delivered by the
Borrower, each of the Subsidiary Guarantors, Lenders constituting the "Required
Lenders" under the Existing Credit Agreement, and the Administrative Agent.
SECTION 4.02. Other Documents. The Administrative Agent shall
have received such documents as the Administrative Agent, any Lender or special
New York counsel to Chase may reasonably request in connection herewith.
-15-
ARTICLE V
Confirmation of Collateral Security
Each Obligor, by its signature below, hereby confirms that the
obligations of such Obligor in respect of the Incremental Facility Loans, are
entitled to the benefits of the Guarantees and collateral security provided for
pursuant to the Security Documents to which such Obligor is a party.
ARTICLE VI
Miscellaneous.
Except as herein provided, the Existing Credit Agreement shall
remain unchanged and in full force and effect. This Second Amended and Restated
Credit Agreement may be executed in any number of counterparts, all of which
taken together shall constitute one and the same amendatory instrument and any
of the parties hereto may execute this Second Amended and Restated Credit
Agreement by signing any such counterpart and sending the same by telecopier,
mail messenger or courier to the Administrative Agent or counsel to the
Administrative Agent. This Second Amended and Restated Credit Agreement shall be
governed by, and construed in accordance with, the law of the State of New York.
-16-
IN WITNESS WHEREOF, the parties hereto have caused this Second
Amended and Restated Credit Agreement to be duly executed and delivered as of
the day and year first above written.
CANANDAIGUA BRANDS, INC.
By /s/Xxxxxx X. Summer
Title: Senior Vice President
and Chief Financial Officer
SUBSIDIARY GUARANTORS
BATAVIA WINE CELLARS, INC.
CANANDAIGUA EUROPE LIMITED
CANANDAIGUA WINE COMPANY, INC
POLYPHENOLICS, INC.
XXXXXXX TRADING CORP.
By /s/Xxxxxx X. Summer
Title: Treasurer
XXXXXX INCORPORATED
XXXXXX BRANDS, LTD.
XXXXXX XXXXX, LTD.
XXXXXX BRANDS OF CALIFORNIA, INC.
XXXXXX BRANDS OF GEORGIA, INC.
XXXXXX DISTILLERS IMPORT CORP.
XXXXXX FINANCIAL CORPORATION
MONARCH IMPORT COMPANY
XXXXXXX POINT BEVERAGE CO.
THE VIKING DISTILLERY, INC.
By /s/Xxxxxx X. Summer
Title: Vice President
CANANDAIGUA LIMITED
By /s/Xxxxxx X. Summer
Title: Finance Director
CANANDAIGUA B.V.
By /s/Xxxxxx X. Summer
Title: Authorized Attorney
-17-
LENDERS
THE CHASE MANHATTAN BANK,
individually, as Swingline Lender
and as Administrative Agent
By /s/Xxxxx Xxxxxx
Title: Vice President
THE BANK OF NOVA SCOTIA
By /s/J. Xxxx Xxxxxxx
Title: Authorized Signatory
CREDIT SUISSE FIRST BOSTON
By /s/Xxxxx X. Xxxxxx
Title: Vice President
By /s/Xxxxxxx Xxxxx
Title: Associate
FLEET NATIONAL BANK
By /s/Xxxxxx X. Birmingham
Title: Vice President
COOPERATIEVE CENTRALE RAIFFEISEN-
BOERENLEENBANK B.A. "RABOBANK
NEDERLAND", NEW YORK BRANCH
By /s/Xxx Xxxxx
Title: Senior Credit Officer
By /s/Xxxxx X. Xxxx
Title:Vice President
-18-
CREDIT LYONNAIS, NEW YORK BRANCH
By /s/Xxxxxxx Labbun
Title: First Vice President - Manager
FIRST NATIONAL BANK OF CHICAGO
By /s/Xxxxxxx Xxxxxxxx
Title: Officer
FIRST UNION NATIONAL BANK
(successor to CoreStates Bank, N.A.)
By /s/Xxxxx X. Xxxxxx
Title: Vice President
NATIONSBANK, N.A.
By:/s/Xxxxxxx X. Xxxxxxxx
Title: Senior Vice President
SUNTRUST BANK, ATLANTA
By /s/Xxxx X. Xxxxx
Title: Associate
By /s/ Xxxxxx X. Xxxxxxxxx
Title: Vice President
XXXXX FARGO BANK, NATIONAL ASSOCIATION
By /s/Xxxxxx X. Xxxxxx
Title: Vice President
-19-
BARCLAYS BANK PLC
By /s/Xxxxxxx Xxxxxxxxxxxx
Title: Vice President
CIBC INC
By /s/Xxxxxx Xxxxxxx
Title: Executive Director
COBANK, ACB
By /s/Xxxxx X. Xxxxx
Title: Vice President
CREDIT AGRICOLE INDOSUEZ
By /s/Xxxx X. Xxxxxxxxx
Title: Senior Relationship Manager
B /s/Xxxxxxxxx X. Xxxxxx
Title: First Vice President/Managing
Director
DEUTSCHE BANK, NEW YORK and/or
CAYMAN ISLANDS BRANCH
By /s/Xxxxxxxxx Xxxxx
Title: Associate
By /s/Xxxxxxx X. Xxxxxxxxx
Title: Director
MANUFACTURERS AND TRADERS TRUST
COMPANY
By /s/Xxxxxx X. Xxxxx
Title: Regional Senior Vice President
-00-
XXXX XXXXXXX CREDITANSTALT
CORPORATE FINANCE, INC.
By /s/Xxxxxxx Xxxxxx
Title: Vice President
By /s/Xxxx Xxxx
Title: Vice President
BANK UNITED
By /s/Xxxx Xxxxx
Title: Director - Commercial
Syndications
BANQUE NATIONALE DE PARIS
By /s/Xxxxxxx X. Xxxx
Title:
By /s/Xxxxxxx Xxxx
Title: Vice President
Corporate Banking Division
XXXXXX TRUST AND SAVINGS BANK
By /s/Xxxxx X. Xxxxx, Xx.
Title: Vice President
KEY BANK NATIONAL ASSOCIATION
By /s/Xxxxxxxx X. Xxxx
Title: Senior Vice President
-21-
NATIONAL CITY BANK
By /s/Xxxx X. Xxxx
Title: Vice President
STATE STREET BANK AND TRUST COMPANY
By /s/Xxxxxxxxxxx Del Xxxxxxx
Title: Vice President
USTRUST
By /s/Xxxxxx X. Xxxxxx
Title: Vice President
WACHOVIA BANK, N.A.
By /s/Xxxxxxxx X. Xxxxxxx
Title: Vice President
THE BANK OF NEW YORK
By /s/Xxxxxx X. XxXxxxxx
Title: Vice President
KBC BANK
By:_________________________________
Title:
By:_________________________________
Title:
-22-
HSBC BANK USA
By /s/Xxxxxx X. Xxxxx
Title: Authorized Signatory
BANK OF TOKYO-MITSUBISHI TRUST
COMPANY
By /s/Xxx Xxxxx
Title: Vice President
DEUTSCHE FINANCIAL SERVICES
CORPORATION
By /s/Xxxxx X. Xxxxxxxx
Title: Vice President
