AGRILINK FOODS, INC.
SIXTH AMENDMENT TO CREDIT AGREEMENT
To the Agents and Lenders
Party to the Credit Agreement
referred to below
Gentlemen:
We refer to the Credit Agreement dated as of September 23, 1998 among
Agrilink Foods, Inc. as Borrower, Pro-Fac Cooperative, Inc., Linden Oaks
Corporation and Xxxxxxx Endeavors, Incorporated as Guarantors, Xxxxxx Trust and
Savings Bank individually and as Administrative Agent and the other lenders from
time to time parties thereto as amended and currently in effect between us (the
"Credit Agreement"), capitalized terms used without definition below to have the
meanings ascribed to them in the Credit Agreement.
Upon satisfaction of the conditions precedent to effectiveness set
forth below, the Credit Agreement shall be amended in certain respects effective
September 22, 2000 (the "Effective Date"), all as hereinafter set forth:
1. AMENDMENTS.
A. Certain Definitions. Certain of the definitions
appearing in Section 1.1 of the Credit Agreement shall be amended as
follows:
1. The definition of the term "Applicable Margin"
shall be amended and restated as so amended to read as
follows: "Applicable Margin" shall mean the rate per annum
specified below for the Leverage Ratio and type of Loan,
Portion or fee for which the Applicable Margin is being
determined:
(a) with respect to the commitment fee, the Letter of
Credit fee called for by Section 4.2(a) hereof and each type of
Portion of the Revolving Credit Loans and the A Loans described
below, the rate per annum shown below for the range of Leverage
Ratio specified below:
XXXXX 0 XXXXX XX XXXXX XXX XXXXX XX
Leverage Ratio <3.5 to 1 =3.5 to 1 but =4.0 to 1 but =4.5 to 1
<4.0 to 1 <4.5 to 1
Base Rate Portion 0% .25% 1.00% 1.25%
LIBOR Portion 1.75% 2.00% 2.75% 3.00%
& L/C Fee
Commitment Fee 0.40% 0.45% 0.50% 0.50%
(b) with respect to the B Loans, the Applicable Margin
for LIBOR Portions shall be 4.00% and for the Base Rate Portion
shall be 3.00%, provided that effective 5 Business Days after
receipt by the Administrative Agent of the financial statements
called for by Section 8.5(a) hereof for the first fiscal quarter
ending after September 22, 2000 as of the last day of which the
Leverage Ratio is less than 4.0 to 1, the Applicable Margins for B
Loans shall become 3.75% for LIBOR Portions and 2.75% for the Base
Rate Portion; and
(c) with respect to the C Loans, the Applicable Margin
for LIBOR Portions shall be 4.25% and for the Base Rate Portion
shall be 3.25%, provided that effective 5 Business Days after
receipt by the Administrative Agent of the financial statement
called for by Section 8.5(a) hereof for the first fiscal quarter
ending after September 22, 2000 as of the last day of which the
Leverage Ratio is less than 4.0 to 1, the Applicable Margins for C
Loans shall become 4.00% for LIBOR Portions and 3.00% for the Base
Rate Portion;
provided, however that the foregoing are subject to the
following:
(i) the Leverage Ratio shall be determined as of the
last day of each fiscal quarter of the Parent, with any adjustment
in the Applicable Margins resulting from a change in such Leverage
Ratio to be effective 5 Business Days after receipt by the
Administrative Agent of the financial statements for such quarter
called for by Section 8.5(a);
(ii) if and so long as any Event of Default has occurred
and is continuing, the Applicable Margins other than the
Applicable Margin for the commitment fee as otherwise computed
hereunder shall be increased by adding the rate of 2% per annum
thereto; and
(iii) anything contained hereinabove to the contrary
notwithstanding, the Applicable Margins for the period to the
effective date of the first adjustment in the Applicable Margins
made subsequent to the Effective Date pursuant to clause (i) above
shall be those specified above for Level IV.
2. The definition of the term "Consolidated Net
Income" shall be amended and restated as so amended to read
as follows:
"Consolidated Net Income" for any period shall mean the gross
revenues from any source of the Parent and its Subsidiaries
for such period less all expenses and other proper charges
determined for the Parent and its Subsidiaries on a
consolidated basis in accordance with GAAP.
3. The definition of the term "Consolidated
Net Working Capital" shall be amended and restated as so
amended to read as follows:
"Consolidated Net Working Capital" shall mean as of any time
the same is to be determined, the excess for the Parent and
its Subsidiaries on a consolidated basis of current assets
(other than cash and investments permitted by clauses (a)
through (e), both inclusive, of Section 8.17 hereof) over
current liabilities, all as determined and computed in
accordance with GAAP.
4. The definition of the term "EBITDA" shall be
amended and restated as so amended to read as follows:
"EBITDA" shall mean, with reference to any period,
Consolidated Net Income for such period plus all amounts
deducted in arriving at such Consolidated Net Income in
respect of (i) Interest Expense, (ii) taxes imposed on or
measured by income or excess profits, and (iii) all charges
for depreciation of fixed assets and amortization of
intangibles, all determined in accordance with GAAP. Solely
for the purpose of computing EBITDA, Consolidated Net Income
shall be computed prior to giving effect to gains and losses
on the disposition of capital assets, other extraordinary
gains and losses (including the write off of debt issuance
costs, the payment of premiums on the retirement of
Indebtedness and gains resulting from pension reversions) and
the effect of one time nonrecurring non cash charges
(including asset impairment charges), all as determined in
accordance with GAAP.
5. The definition of the term "Fixed Charge
Coverage Ratio" shall be amended by adding the phrase "and on
the Revolving Credit Loans" immediately prior to the phrase
"shall be excluded" in the second parenthetical clause
thereof.
B. Certain Covenants. Sections 8.11 through 8.14 of
the Credit Agreement shall be amended and restated as so amended to
read as follows:
Section 8.11. Leverage Ratio The Parent will as of the last day of each
fiscal quarter (commencing with the second fiscal quarter of fiscal 1999), have
a Leverage Ratio of not more than that specified for such fiscal quarter below:
MAXIMUM LEVERAGE
FOR FISCAL QUARTERS : RATIO SHALL BE
Second of Fiscal 1999 6.00 to 1
Third of Fiscal 1999 5.75 to 1
Fourth of Fiscal 1999 5.5 to 1
First of Fiscal 2000 6.5 to 1
Second of Fiscal 2000 6.25 to 1
Third of Fiscal 2000 6.00 to 1
Fourth of Fiscal 2000 5.00 to 1
All Fiscal Quarters of Fiscal 2001 5.15 to 1
All Fiscal Quarters of Fiscal 2002 4.75 to 1
All Fiscal Quarters of Fiscal 2003 4.50 to 1
All Fiscal Quarters of Fiscal 2004 4.25 to 1
All Fiscal Quarters Thereafter 4.00 to 1
The foregoing to the contrary notwithstanding, if the Parent has a
Leverage Ratio of 3.0 to 1 or less computed as of the last day of two
consecutive fiscal quarters ending subsequent to the close of its 1999 fiscal
year, then the Parent shall have a Leverage Ratio as of the last day of each
fiscal quarter ending thereafter of not less than 3.5 to 1.
Section 8.12. Fixed Charge Coverage Ratio. The Parent will as of the
last day of each fiscal quarter (commencing with the second fiscal quarter of
fiscal 1999) have a Fixed Charge Coverage Ratio of not less than that specified
for such fiscal quarter below:
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AS OF THE LAST DAY OF THE FIXED CHARGE COVERAGE
FOLLOWING FISCAL QUARTERS : RATIO SHALL NOT BE LESS THAN
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Second through Fourth of fiscal 1999 1.05 to 1
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First through Third of fiscal 2000 .95 to 1
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Fourth of Fiscal 2000 1.15 to 1
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All fiscal quarters of Fiscal 2001, 2002, and First through Third of Fiscal 1.10 to 1
2003
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all fiscal quarters thereafter 1.25 to 1
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Section 8.13. EBITDA. The Parent will as of the last day of each
fiscal quarter have EBITDA for the period of four fiscal quarters then ended
of not less than that specified for such fiscal quarter below (with EBITDA for
periods prior to the Acquisition Closing Date computed as though DFVC were at
all times a Subsidiary of the Company and as though the Company had not owned
its aseptic business):
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For fiscal quarters: EBITDA shall not be less than
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First and second of fiscal 1999 $115,000,000
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Third of fiscal 1999 $120,000,000
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Fourth of fiscal 1999 $125,000,000
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First of fiscal 2000 $108,000,000
--------------------------------------------------------------------------------
Second of fiscal 2000 $110,000,000
--------------------------------------------------------------------------------
Third of fiscal 2000 $115,000,000
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Fourth of fiscal 2000 $135,000,000
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All fiscal quarters of fiscal 2001 $130,000,000
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All fiscal quarters of fiscal 2002 and First, through $135,000,000
Third of fiscal 2003
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Fourth of Fiscal 2003 and First through Third of $140,000,000
Fiscal 2004
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All fiscal quarters ended thereafter $145,000,000
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Section 8.14. Interest Coverage Ratio. The Parent will as of the
last day of each fiscal quarter (commencing with the second fiscal quarter of
fiscal 1999) have an Interest Coverage Ratio of not less than that specified for
such quarter below:
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Interest Coverage Ratio
For fiscal quarters: shall not be less than
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Second through fourth of fiscal 1999 1.90 to 1
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First, Second and Third of fiscal 2000 1.40 to 1
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Fourth of fiscal 2000 1.75 to 1
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all fiscal quarters of fiscal 2001 1.65 to 1
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all fiscal quarters of fiscal 2002 and 2003 1.75 to 1
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all fiscal quarters of fiscal 2004 1.85 to 1
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all fiscal quarters ended thereafter 2.00 to 1
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2. CONDITIONS PRECEDENT TO EFFECTIVENESS. Subject to the last sentence
of this Section 2, this Sixth Amendment to Credit Agreement shall become
effective upon (i) receipt by the Administrative Agent of counterparts hereof
which, taken together, bear the signatures of the Borrower, the Guarantors and
the Required Lenders and (ii) receipt by the Administrative Agent of a fee for
each Lender executing this Sixth Amendment to Credit Agreement and returning it
to the Administrative Agent on or before September 21, 2000 (the "Assenting
Lenders") in an amount equal to 1/4 of 1% of the sum of its Revolving Credit
Commitment and the outstanding principal balance of its Term Loans (the
Administrative Agent to promptly distribute such fees to the Assenting Lenders
upon this Sixth Amendment to Credit Agreement becoming effective). Upon
satisfaction of the foregoing conditions, all amendments provided for herein
(including the adjustments in the Applicable Margins) shall be deemed effective
as of the Effective Date irregardless of the date such conditions were
satisfied.
3. SUPPLEMENTAL FEE. If but only if the Leverage Ratio as computed as
of the last day of the Parent's first fiscal quarter of fiscal 2002 is greater
than 4.50 to 1 the Company shall, within 50 days of the close of such fiscal
quarter, pay to the Administrative Agent, for the account of the Assenting
Lenders, a fee equal to 1/4 of 1% of the sum of the Revolving Credit Commitments
and the outstanding principal balances of the Term Loans of the Assenting
Lenders as of the close of such fiscal quarter, the Administrative Agent to
promptly distribute such fee to the Assenting Lenders.
4. MISCELLANEOUS. Except as specifically amended hereby, all of the
terms, conditions and provisions of the Credit Agreement shall stand and remain
unchanged and in full force and effect. No reference to this Sixth Amendment to
Credit Agreement need be made in any instrument or document at any time
referring to the Credit Agreement, a reference to the Credit Agreement in any of
such to be deemed to be a reference to the Credit Agreement as amended hereby.
This Sixth Amendment to Credit Agreement shall constitute a "Loan Document" for
purposes of the Credit Agreement and may be executed in counterparts, and by
separate parties hereto on separate counterparts each to constitute an original
but all but one and the same instrument. The headings of the sections hereof are
for convenience of reference only and shall not affect the meaning of the
provisions hereof. This Sixth Amendment to Credit Agreement shall be governed by
and construed in accordance with the internal laws of the State of Illinois.
Dated as of the 22nd day of September 2000.
AGRILINK FOODS, INC.
By /s/Xxxxx X. Xxxxxxxx
Its VP and General Counsel
PRO-FAC COOPERATIVE, INC.
By /s/Xxxx X. Xxxxxx
Its Vice President
LINDEN OAKS CORPORATION
By /s/Xxxxxxx X. Xxxxxxxx
Its President
XXXXXXX ENDEAVORS, INCORPORATED
By /s/Xxxx X. Xxxxxx
Its Vice President
Accepted and agreed to as of the date last above written.
XXXXXX TRUST AND SAVINGS BANK,individually and as Administrative
Agent, Issuing Bank and Swing Lender
By /s/Xxxxx Xxxx
Its Vice President
