SEVENTH AMENDMENT AGREEMENT
Exhibit
10.39
SEVENTH AMENDMENT
AGREEMENT
SEVENTH
AMENDMENT AGREEMENT (this “Agreement”) dated as
of November 27, 2007, by and among United Natural Foods, Inc. and Albert’s
Organics, Inc. (collectively, the “Borrowers”), and Bank
of America, N.A., as successor to Fleet Capital Corporation (the “Lender”), with
respect to the Term Loan Agreement dated as of April 28, 2003, as amended by an
Amendment to Term Loan Agreement dated August 26, 2003, a Second Amendment to
Term Loan Agreement dated December 18, 2003, a Third Amendment to Term Loan
Agreement dated April 30, 2004, a Fourth Amendment to Term Loan Agreement dated
June 15, 2005, a Fifth Amendment to Term Loan Agreement dated July 28, 2005, and
a Sixth Amendment to Term Loan Agreement dated November 2, 2007 (as amended, the
“Term Loan
Agreement”).
W
I T N E S S E T H:
WHEREAS,
the Borrowers have requested that the Lender waive certain Events of Default
which exist under the Term Loan Agreement and amend certain other provisions of
the Term Loan Agreement, and the Lender is willing to waive such Events of
Default and amend the Term Loan Agreement, on the terms and conditions set forth
herein.
NOW,
THEREFORE, for good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties hereto agree as follows:
§1. Definitions. Capitalized
terms used herein without definition that are defined in the Term Loan Agreement
shall have the meanings given to such terms in the Term Loan Agreement, as
amended hereby.
§2. Representations
and Warranties; Acknowledgment. The Borrowers
hereby represent and warrant to the Lender as follows:
(a) Each
of the Borrowers has adequate power to execute and deliver this Agreement and
each other document to which it is a party in connection herewith and to perform
its obligations hereunder or thereunder. This Agreement and each
other document executed in connection herewith have been duly executed and
delivered by each of the Borrowers and do not contravene any law, rule or
regulation applicable to any Borrower or any of the terms of any other
indenture, agreement or undertaking to which any Borrower is a
party. The obligations contained in this Agreement and each other
document executed in connection herewith to which any of the Borrowers is a
party, taken together with the obligations under the Loan Documents, constitute
the legal, valid and binding obligations enforceable against any such Borrower
in accordance with their respective terms.
(b) After
giving effect to the transactions contemplated by this Agreement, all the
representations and warranties made by the Borrowers in the Loan Documents are
true and correct on the date hereof as if made on and as of the date hereof and
are so repeated herein as if expressly set forth herein or therein, except to
the extent that any of such representations and warranties expressly relate by
their terms to a prior date.
(c) After
giving effect to the transactions contemplated by this Agreement, no Event of
Default under and as defined in any of the Loan Documents has occurred and is
continuing on the date hereof.
§3. Amendments
to Term Loan Agreement. The Term Loan Agreement is
hereby amended as follows:
3.1. Amendments
to Appendix A.
(a) The
following definition set forth in Appendix A of the Term Loan Agreement is
hereby amended and restated in its entirety to read as follows:
Working Capital
Facility - the revolving loan facility available to United Natural Foods,
Inc. and certain of its Affiliates pursuant to the Revolving Loan
Agreement.
(b) The
following new definitions are added in alphabetical order to Appendix A of the
Term Loan Agreement to read as follows:
Material
Acquisition - any acquisition or investment or series of
acquisitions or investments in respect of which the consideration therefor
exceeds (i) $10,000,000 for any single acquisition or investment and $25,000,000
in the aggregate for all acquisitions and/or investments in any fiscal year of
Borrowers paid in cash and/or incurred Indebtedness by Borrowers, (ii) in cases
in which the consideration paid by Borrowers is shares of UNF common stock,
$25,000,000 in value for all such acquisitions in any fiscal year of Borrowers
or (iii) in transactions involving any combination of cash, incurred
Indebtedness and/or UNF common stock, subject to the foregoing limits (subject
in all such cases to the limitations of Section 8.1.12 hereof).
Permitted Acquisition
-- a purchase by a Borrower of a business, which purchase is permitted by the
terms of Subsection 6.2.1 hereof.
Revolving Loan
Agreement -- the Amended and Restated Loan and Security Agreement dated
April 30, 2004, among United Natural Foods, Inc. and certain of its Affiliates,
the lenders party thereto, and Bank of America, N.A. as agent for such lenders,
as amended, restated, or supplemented from time to time (including the Fourth
Amendment Agreement with respect thereto pursuant to which the aggregate
commitments of the lenders thereunder have been increased to $400,000,000 and
are subject to being further increased to an amount of up to
$450,000,000).
Seventh Amendment
Agreement - the Seventh Amendment Agreement dated as of November 27, 2007
among the Borrowers and the Lender with respect to this Term Loan
Agreement.
Seventh Amendment Effective
Date - the date on which all of the conditions precedent set forth in
Section 6 of the Seventh Amendment Agreement have been satisfied (or waived by
the Lender).
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3.2. Amendment
of Subsection 6.2.1
Clauses
(a) and (b) of subsection 6.2.1 of the Loan Term Agreement are hereby amended
and restated in their entirety to read as follows:
(a) (i)
in respect of any Material Acquisition, UNF shall have delivered to the Lender
not less than ten (10) Business Days prior to the earlier of (A) the execution
of a definitive or binding agreement to enter into the proposed Permitted
Acquisition and (B) the consummation of such proposed Permitted Acquisition, a
copy of the proposed acquisition agreement and a statement, certified by the
principal financial or accounting officer of UNF, setting forth, in reasonable
detail, computations evidencing on a pro forma basis (determined in a manner
acceptable to the Lender) compliance with the financial covenants contained in
Section 6.3 hereof, immediately prior to and after giving effect to such
proposed Permitted Acquisition, and (ii) no Default or Event of Default shall
exist before or after giving effect to the proposed Permitted Acquisition, (b)
such purchase shall be permitted under the terms of the Revolving Credit
Agreement, as in effect at the time of such purchase;
3.3. Amendment
of Subsection 6.2.7
Clauses
(c) and (d) of Subsection 6.2.7 of the Term Loan Agreement are hereby deleted
and the following clause (c) is substituted therefor (and the word “and” is
added after clause (b)):
(c) other
Distributions, provided that a
Distribution shall only be permitted pursuant to this clause (c) if (i) UNF
shall have delivered to the Lender between two (2) and five (5) Business Days
prior to the date of such Distribution a statement, certified by the principal
financial or accounting officer of UNF, setting forth, the nature, amount and
recipients of the proposed Distribution and setting forth, in reasonable detail,
computations evidencing on a pro forma basis (determined in a manner acceptable
to the Lender) compliance with the financial covenants contained in Section 6.3
hereof, immediately prior to and after giving effect to such proposed
Distribution, and (ii) no Default or Event of Default shall exist before or
after giving effect to the proposed Distribution, and (iii) such Distribution
shall be permitted under the terms of the Revolving Credit Agreement, as in
effect at the time of such Distribution.
3.4. Amendment
of Section 9.8
Section
9.8 of the Term Loan Agreement is hereby amended and restated in its entirety to
read as follows:
9.8 Notice. Except as
otherwise provided herein, all notices, requests and demands to or upon a party
hereto, to be effective, shall be in writing and shall be sent by certified or
registered mail, return receipt requested, by personal delivery against receipt,
by overnight courier or by facsimile and, unless otherwise expressly provided
herein, shall be deemed to have been validly served, given or delivered
immediately when delivered against receipt, one Business Day after being sent by
overnight courier, three
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Business
Days after deposit in the mail, postage prepaid, or, in the case of facsimile
notice, when sent, addressed as follows:
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If
to Lender:
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Bank
of America, N.A.
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000
Xxxxxxxxxxx Xxxxxxxxx
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Xxxxxxxxxxx,
XX 00000
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Attention:
Xxxxx Xxxxxxx
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Facsimile
No.: (000) 000-0000
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With
a copy to:
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Xxxxxxx
XxXxxxxxx LLP
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Xxx
Xxxxx Xxxxxx
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Xxxxxxxx,
XX 00000
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Attention:
Xxxxxx X. Xxxxxxxxxxx, Esq.
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Facsimile
No.: (000) 000-0000
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If
to Borrowers:
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c/o
United Natural Foods, Inc.
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000
Xxxx Xxxx
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Xxxxxxxx,
XX 00000
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Attention:
Xxxx Xxxxxxx, Vice President, Chief Financial Officer and
Treasurer
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Facsimile
No.: (000) 000-0000
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With
a copy to:
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Cameron
& Xxxxxxxxx
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00
Xxxxxxxx Xxxxxxx
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Xxxxxxxxxx,
XX 00000
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Attention:
Xxxxxx X. Xxxxxx, Esq.
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Facsimile
No.: (000) 000-0000
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or to
such other address as each party may designate for itself by notice given in
accordance with this Section
9.8.
§4. Ratification,
etc. All of the obligations and liabilities to the Lender as
evidenced by or otherwise arising under the Term Loan Agreement and the other
Loan Documents, are, by the Borrowers’ execution of this Agreement, ratified and
confirmed in all respects. In addition, by each Borrower’s execution
of this Agreement, such Borrower represents and warrants that neither it nor any
of its Subsidiaries has any counterclaim, right of set-off or defense of any
kind with respect to such obligations and liabilities. This Agreement
and the Term Loan Agreement shall hereafter be read and construed together as a
single document, and all references in the Term Loan Agreement or any related
agreement or instrument to the Term Loan Agreement shall hereafter refer to the
Term Loan Agreement as amended by this Agreement.
§5. Waivers. Subject
to the satisfaction of the conditions set forth herein, the Lender waives those
Events of Default that have occurred under the Term Loan Agreement as a result
of the Borrowers’ failure on or before the date hereof to comply with those
sections of the Term Loan Agreement set forth on Schedule 1 attached
hereto. The waivers set forth in this Section 5 shall be effective
only for those Events of Default contained in the Term Loan Agreement
as
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specified
in Schedule
1 which
occurred on or before the date hereof and such waiver shall not entitle the
Borrowers to any future waiver in similar or other
circumstances. Without limiting the foregoing, upon the occurrence
and during the continuation of an Event of Default not set forth in Schedule 1, subject to the
provisions of the Term Loan Agreement, the Lender shall be free in its sole and
absolute discretion to accelerate the payment in full of the Obligations, and
may, if the Lender so elects, proceed to enforce any or all of its rights under
or in respect of the Term Loan Agreement and the other Loan Documents and
applicable law. Except as otherwise expressly provided for herein, nothing in
this Agreement shall extend to or affect in any way the Borrowers’ obligations
or the Lender’s rights and remedies arising under the Term Loan Agreement or the
other Loan Documents, and Lender shall not be deemed to have waived any or all
of its remedies with respect to any Event of Default (other than the Events of
Default described on Schedule 1 attached hereto,
and then only to the extent set forth therein) or event or condition which, with
notice or the lapse of time, or both would become an Event of Default and which
upon the Borrowers’ execution and delivery of this Agreement might otherwise
exist or which might hereafter occur.
§6. Conditions
to Effectiveness. The effectiveness of the amendments set
forth in Section 3 of this Agreement and the waivers set forth in Section 5 of
this Agreement are subject to the prior satisfaction, on or before November 27,
2007, of the following conditions precedent (the date of such satisfaction
herein referred to as the “Seventh Amendment Effective
Date”):
(a) Representations and
Warranties. The representations and warranties of the
Borrowers contained herein shall be true and correct.
(b) No Event of
Default. There shall exist no Default or Event of
Default.
(c) Corporate or Limited
Liability Company Action. The Lender shall have received
evidence reasonably satisfactory to the Lender that all requisite corporate or
limited liability company, as applicable, action necessary for the valid
execution, delivery and performance by the Borrowers of this Agreement and all
other instruments and documents delivered by the Borrowers in connection
herewith has been taken.
(d) Delivery of this
Agreement. The Borrowers and the Lender shall have executed
and delivered this Agreement and each Guarantor shall have acknowledged its
acceptance of or agreement to this Agreement and its ratification of the
continuing effectiveness of its Guaranty.
(e) Additional
Guaranties. Distribution Holdings Inc. and Millbrook
Distribution Services, Inc., each a Delaware corporation, shall have executed
Guaranty Agreements in form and substance satisfactory to the Lender, pursuant
to which such Persons shall unconditional guaranty the repayment as and when due
of all of the Obligations.
(f) Amendment of Intercreditor
Agreement. The Intercreditor Agreement shall have been amended
in such manner as may be deemed by the Lender to be necessary or appropriate in
connection with the amendments set forth herein.
(g) Payment of
Expenses. The Borrowers shall have paid to the
Lender all amounts payable to the Lender under §7
hereof.
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(h) Amendment of Working Capital
Facility. The Working Capital Facility shall have been amended
by an amendment in form and substance satisfactory to the Lender, including
without limitation an amendment increasing the aggregate amount of commitments
by the lenders under the Working Capital Facility to not less than
$400,000,000.
(i)
Organic Brands
Subordination Agreement. United Natural Foods, Inc., the
Lender and Organic Brands, LLC shall have entered into a Subordination Agreement
with respect to that certain Promissory Note dated March 30, 2007 executed by
United Natural Foods, Inc. in favor of Organic Brands, LLC, such Subordination
Agreement to be in form and substance satisfactory to the Lender.
(j)
Participant
Consents. The Lender shall have received the written consent
of each participant in the Term Loan to the provisions of this
Agreement.
(k) Other
Documents. The Borrowers shall have executed and delivered
such other documents, and taken such other action, as may be reasonably
requested by the Lender in connection with this Agreement.
§7. Expenses,
Etc. Without limitation of the amounts payable by the
Borrowers under the Term Loan Agreement and other Loan Documents, the Borrowers
shall pay to the Lender and its counsel upon demand an amount equal to any and
all out-of-pocket costs or expenses (including reasonable legal fees and
disbursements and appraisal expenses) incurred by the Lender in connection with
the preparation, negotiation and execution of this Agreement and the matters
related thereto.
§8. Time is
of the Essence; No Waivers by Lender. TIME IS OF THE ESSENCE
WITH RESPECT TO ALL COVENANTS, CONDITIONS, AGREEMENTS OR OTHER PROVISIONS
HEREIN. Except as otherwise expressly provided for herein, nothing in
this Agreement shall extend to or affect in any way the Borrowers’ obligations
or the Lender’s rights and remedies arising under the Term Loan Agreement or the
other Loan Documents.
§9. Governing
Law. This Agreement
shall for all purposes be construed according to and governed by the laws of the
State of Connecticut (excluding the laws thereof applicable to conflicts of law
and choice of law).
§10. Effective
Date. The
amendments set forth in Section 3 hereof shall become effective among the
parties hereto as of the Seventh Amendment Effective Date. Until the
Seventh Amendment Effective Date, the terms of the Term Loan Agreement prior to
its amendment hereby shall remain in full force and effect. This
Agreement is effective as to all provisions other than the amendments set forth
in Section 3 hereof at the time that the Borrowers and the Lender have executed
and delivered this Agreement.
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§11. Entire
Agreement; Counterparts. This Agreement
sets forth the entire understanding and agreement of the parties with respect to
the matters set forth herein, including the amendments set forth herein, and
this Agreement supersedes any prior or contemporaneous understanding or
agreement of the parties as to any such amendment of the provisions of the Term
Loan Agreement or any Loan Document, except for any such contemporaneous
agreement that has been set forth in writing and executed by the Borrowers and
the Lender. This Agreement may be executed in any number of
counterparts and by different parties hereto on separate counterparts, each of
which when so executed and delivered shall be an original, but all of which
counterparts taken together shall be deemed to constitute one and the same
instrument. A facsimile or other electronic transmission of an
executed counterpart shall have the same effect as the original executed
counterpart.
[Remainder
of Page Intentionally Left Blank; Signature Pages Follow]
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IN
WITNESS WHEREOF, the parties have caused this Agreement to be executed by their
duly authorized officers, as of the day and year first above
written.
BORROWERS:
UNITED
NATURAL FOODS, INC.
By: /s/ Xxxx X. Xxxxxxx
Name:
Xxxx Xxxxxxx
Title:
Vice President, CFO and Treasurer
ALBERT’S
ORGANICS, INC.
By: /s/ Xxxx X. Xxxxxxx
Name:
Xxxx Xxxxxxx
Title:
Vice President, Secretary and Treasurer
[Signature Page to Seventh
Amnendment Agreement - United Natural Foods, Inc., et al]
LENDER:
BANK
OF AMERICA, N.A.
By: /s/ Xxxxx Xxxxxxx
Name:
Xxxxx Xxxxxxx
Title:
Senior Vice President
[Signature Page to Seventh Amnendment Agreement - United Natural Foods,
Inc., et al]
Each of
the undersigned Guarantors
acknowledges
and agrees to the foregoing,
and
ratifies and confirms in all respects
such
Guarantor’s obligations under the
Guaranty
Agreements:
NATURAL
RETAIL GROUP, INC.
By: /s/ Xxxx X. Xxxxxxx
Name:
Xxxx Xxxxxxx
Title:
Vice President, Secretary and Treasurer
SPRINGFIELD
DEVELOPMENT, LLC
By: /s/ Xxxx X. Xxxxxxx
Name:
Xxxx Xxxxxxx
Title:
Vice President, Secretary and Treasurer
UNITED
NATURAL FOODS WEST, INC.
By: /s/ Xxxx X. Xxxxxxx
Name:
Xxxx Xxxxxxx
Title:
Vice President, Secretary and Treasurer
UNITED
NATURAL TRADING CO.
By: /s/ Xxxx X. Xxxxxxx
Name:
Xxxx Xxxxxxx
Title:
Vice President, Secretary and Treasurer
[Signature Page to Seventh Amnendment Agreement - United Natural Foods,
Inc., et al]
DISTRIBUTION
HOLDINGS, INC.
By: /s/ Xxxx X. Xxxxxxx
Name:
Xxxx Xxxxxxx
Title:
Vice President, Secretary and Treasurer
MILLBROOK
DISTRIBUTIOIN SERVICES INC.
By: /s/ Xxxx X. Xxxxxxx
Name:
Xxxx Xxxxxxx
Title:
Vice President, Secretary and Treasurer
[Signature Page to Seventh Amnendment Agreement - United Natural Foods,
Inc., et al]
SCHEDULE 1
Events of
Default
1. The
Event of Default that occurred under Section 8.1.4 of the Term Loan Agreement as
a result of the Borrowers’ failure to comply with Section 6.2.2 and Section
9.2.5 of the Term Loan Agreement in respect of the Indebtedness incurred by
Millbrook Distribution Services Inc. owing to General Electric Company and the
Lien in respect thereof.
2. The
Event of Default that occurred under Section 8.1.4 of the Term Loan Agreement as
a result of the Borrowers’ failure to comply with Section 6.2.5 of the Revolving
Loan Agreement in respect of the Lien incurred by Albert’s Organics, Inc. in
favor of City National Bank.
3. The
Events of Default that occurred under Section 8.1.18 of the Term Loan Agreement
as a result of the following events of default that occurred under the Working
Capital Facility: (a) the event of default that occurred under Section 11.1.4 of
the Revolving Loan Agreement as a result of the Borrowers’ failure to comply
with Section 9.2.1(e) and Section 9.2.7 of the Revolving Loan Agreement in
respect of the Indebtedness incurred by United Natural Foods, Inc. owing to
Organic Brands, LLC evidenced by that certain Promissory Note dated March 30,
2007 executed by United Natural Foods, Inc. in favor of Organic Brands, LLC and
(b) the events of default that occurred under the Revolving Loan Agreement as a
result of the events described in 1 and 2 above.
