FIRST AMENDMENT TO CREDIT AGREEMENT
Exhibit 10 (a)
FIRST AMENDMENT TO CREDIT
AGREEMENT
THIS FIRST AMENDMENT TO CREDIT
AGREEMENT (the “Amendment”) is made effective
as of the 12th day of December, 2007 by and among TASTY BAKING COMPANY, a
Pennsylvania corporation (“Company”), the direct and
indirect subsidiaries of the Company from time to time parties hereto (the
“Subsidiary Borrowers”
and with the Company, collectively, the “Borrowers”), each lender from
time to time party hereto (collectively, the “Lenders” and individually, a
“Lender”), and CITIZENS BANK OF PENNSYLVANIA, as
Administrative Agent, Collateral Agent, Swing Line Lender and L/C Issuer (the
“Agent”).
BACKGROUND
A. Borrowers,
Lenders and Agent have previously entered into a certain Credit Agreement dated
September 6, 2007 (as may be amended, supplemented or restated from time to
time, the “Credit
Agreement”), pursuant to which, inter alia, Agent and
Lenders agreed to extend to Borrowers certain credit facilities subject to the
terms and conditions set forth therein.
B. Borrowers,
Lenders and Agent have agreed to amend the terms of the Credit Agreement in
accordance with the terms and conditions hereof.
C. Capitalized
terms used herein and not otherwise defined in this Amendment shall have the
meanings set forth therefor in the Credit Agreement.
NOW THEREFORE, the parties
hereto, intending to be legally bound hereby, agree as follows:
1. Prime
Rate. The definition of “Prime Rate” set forth in Section
1.01 of the Credit Agreement is hereby amended to read, in its entirety,
as follows:
““Prime Rate” means the
rate of interest announced by Citizens Bank in the Commonwealth of Pennsylvania
from time to time as its “Prime Rate.” Any change in the Prime Rate
shall be effective immediately from and after such change in the Prime
Rate. The Borrowers acknowledge that Lenders may make loans to their
customers above, at or below the Prime Rate.”
2. Cash
Flow. The definition of “Cash Flow” set forth in Section
1.01 of the Credit Agreement is hereby amended to read, in its entirety,
as follows:
““Cash Flow” means with
respect to Borrowers and their Subsidiaries for the applicable period, EBITDA
less the sum of
(a) Unfunded Capital Expenditures, (b) Distributions, and (c) income tax expense
actually paid during such period, determined on a consolidated basis in
accordance with GAAP.”
3. Maturity
Date of Job Bank Term Loan. Section
2.13(d) of the Credit Agreement is hereby amended to change the date of
“August, 2012” in the last sentence of Section
2.13(d) to “September 1, 2012.”
4. Disbursement
of Job Bank Term Loan. Section
4.05 of the Credit Agreement is hereby amended to change the date of
“December 31, 2007” in the first sentence of Section
4.05 to “January 31, 2008.”
5. Maximum
Operating Leverage Ratio. Section
6.12(c) of the Credit Agreement is hereby amended to change the date of
“December 26, 2011” in the last reporting period in Section
6.12 (c) to “December 26, 2010”.
6. Capital
Expenditures. Section
6.12(e) of the Credit Agreement is hereby amended and restated to read in
its entirety as follows:
“(e) Capital
Expenditures. Not permit its Capital Expenditures (excluding
Capital Leases and items included in the Line Item Budget and Disbursement
Schedule) to exceed the amounts indicated for each period specified
below:
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Period
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Maximum
Amount
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From
1/1/07
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$6,250,000
|
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through
12/29/07
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From
12/30/07
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$6,250,000
|
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through
12/27/08
|
|
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From
12/28/08
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$6,500,000
|
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through
12/26/09
|
|
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From
12/27/09
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$6,750,000
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through
12/25/10
|
|
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From
12/26/10
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$7,000,000
|
|
through
12/31/11
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Any unused
amounts in any one year may not be carried over to subsequent years, provided that, for purposes of
calculating compliance with this covenant, if Borrowers have entered into a
binding commitment for a Capital Expenditure in one fiscal year, but the asset
being acquired is not delivered to and paid for by Borrowers until the first
quarter of the following fiscal year, such Capital Expenditure may, at
Borrowers’ sole discretion, be allocated to either (i) the fiscal year in which
the binding commitment is entered into, or (ii) the fiscal year in which the
asset is delivered and paid. Borrowers shall make such allocation and
notify Agent of such allocation on or before the end of the fiscal year in which
the binding commitment is entered into.”
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7. Hedging
Contracts. Section
6.21 of the Credit Agreement is hereby amended to change the date of
“December 5, 2007” in the first sentence of Section
6.21 to “January 31, 2008”.
8. Liquidity
Ratio. Fundings under the Job Bank Term Loan, the PIDC
Financing and the MELF Financing are to be made in one or two lump sum advances
each, after Borrowers have accumulated sufficient costs and expenses for items
covered in the Line Item Budget and Disbursement Schedule equaling or exceeding
the amount of such lump sum advances. In order to accumulate
sufficient costs and expenses to be financed by the lump sum advances under the
Job Bank Term Loan, the PIDC Financing or the MELF Financing, as applicable,
Borrowers intend to pay for such items on an interim basis using advances under
the Working Capital Revolver Loans and the Swing Line Loans until such costs and
expenses equal or exceed the amounts to be funded under the Job Bank Loan, the
PIDC Financing or the MELF Financing, as applicable. Once such
advances under the Working Capital Revolver Loans and the Swing Line Loans equal
or exceed such amounts, Borrowers shall request advances under the Job Bank Term
Loan, the PIDC Financing or the MELF Financing, as applicable, in such lump sum
amounts and shall use the proceeds thereof to pay down the Working Capital
Revolver Loans and the Swing Line Loans.
Lenders agree that the Outstanding
Amount of advances under the Working Capital Revolver Loans and Swing Line Loans
used to pay such costs and expenses on an interim basis pending fundings under
the Job Bank Term Loan, the PIDC Financing or the MELF Financing, as applicable,
shall be excluded from the Outstanding Amount of all Working Capital Revolver
Loans and Swing Line Loans for purposes of calculating the Liquidity Ratio set
forth in Section
6.12(d) of the Credit Agreement. Borrowers
agree: (a) to separately monitor and account for: (i) the outstanding
amount of advances under the Working Capital Revolver Loans and Swing Line Loans
used to pay such costs and expenses on an interim basis, and (ii) the repayment
of such advances, and (b) to include such calculations and accountings with each
Compliance Certificate delivered pursuant to the Credit Agreement.
9. Other
References. All references in the Credit Agreement and all the
Loan Documents to the term “Loan Documents” shall mean the
Loan Documents as defined therein and this Amendment and any and all other
documents executed and delivered by Borrowers pursuant to and in connection
herewith.
10. No
Novation or Waiver. Nothing contained herein constitutes a
novation of the Credit Agreement or any of the documents collateral thereto and
shall not constitute a release, termination or waiver of any of the liens,
security interests, rights or remedies granted to Agent and Lenders in the
Credit Agreement or any of the other Loan Documents, which liens, security
interests, rights or remedies are hereby ratified, confirmed, extended and
continued as security for all obligations secured by the Credit
Agreement. Nothing contained herein constitutes an agreement or
obligation by Agent or Lenders to grant any further amendments to the Credit
Agreement or any of the other Loan Documents.
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11. Inconsistencies. To
the extent of any inconsistency between the terms and conditions of this
Amendment and the terms and conditions of the Credit Agreement or the other Loan
Documents, the terms and conditions of this Amendment shall
prevail. All terms and conditions of the Credit Agreement and the
other Loan Documents not inconsistent herewith, shall remain in full force and
effect and are hereby ratified and confirmed by Borrowers.
12. Counterparts;
Facsimile Signatures. This Amendment may be executed in any
number of counterparts, each of which when so executed and delivered shall be
deemed to be an original without the production of any other
counterpart. Any signature delivered via facsimile shall be deemed an
original signature hereto.
[REMAINDER
OF PAGE INTENTIONALLY LEFT BLANK]
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IN WITNESS WHEREOF, the
parties hereto have executed this Amendment as of the date first above
written.
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BORROWERS:
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TASTY
BAKING COMPANY
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By:
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/s/
Xxxxxxx X. Xxxxx
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Name:
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Xxxxxxx
X. Xxxxx
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Title:
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President
and CEO
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TASTYKAKE
INVESTMENT COMPANY
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By:
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/s/
Xxxxxxx X. Xxxxx
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Name:
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Xxxxxxx
X. Xxxxx
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Title:
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President
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TBC
FINANCIAL SERVICES, INC.
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By:
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/s/
Xxxxxxx X. Xxxxx
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Name:
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Xxxxxxx
X. Xxxxx
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Title:
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President
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TASTY
BAKING OXFORD, INC.
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By:
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/s/
Xxxxxxx X. Xxxxx
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Name:
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Xxxxxxx
X. Xxxxx
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Title:
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President
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AGENT:
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CITIZENS
BANK OF PENNSYLVANIA,
as
Administrative Agent, Collateral Agent and L/C
Issuer
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By:
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/s/
W. Xxxxxxx Xxxxxx
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Name:
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W.
Xxxxxxx Xxxxxx
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Title:
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Senior
Vice President
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CITIZENS BANK OF PENNSYLVANIA,
as Lender
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By:
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/s/ W. Xxxxxxx
Xxxxxx
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Name:
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W.
Xxxxxxx Xxxxxx
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Title:
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Senior
Vice President
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BANK OF AMERICA, N.A., as
Lender
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By:
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/s/ Xxxxxx
Xxxxxx
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Name:
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Xxxxxx
Xxxxxx
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Title:
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Vice
President
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SOVEREIGN BANK, as
Lender
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By:
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/s/ Xxxxxx
Xxxxxxxxxx
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Name:
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Xxxxxx
Xxxxxxxxxx
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Title:
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Senior
Vice President
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MANUFACTURERS AND TRADERS TRUST
COMPANY, as Lender
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By:
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/s/ Xxxxx X.
Xxxxx
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Name:
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Xxxxx
X. Xxxxx
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Title:
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Vice
President
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