EXECUTION COPY
THIRD AMENDMENT, dated as of October 24, 1996 (this "Amendment"),to:
(a) the Term Loan Agreement, dated as of July 17, 1995, as
amended (the "Existing Term Loan Agreement" and, as amended hereby
and as from time to time further amended, supplemented or otherwise
modified, the "Term Loan Agreement") among SPECIALTY FOODS CORPORATION,
a Delaware corporation (the "Term Loan Borrower"), the several banks and
other financial institutions from time to time parties thereto
(the "Term Loan Lenders"), and THE CHASE MANHATTAN BANK (formerly,
Chemical Bank), a New York banking corporation, as administrative agent
for the Term Loan Lenders (the "Administrative Agent"); and
(b) the Revolving Credit Agreement dated as of August 16, 1993
and amended and restated as of July 17, 1995, as amended (the "Existing
Revolving Credit Agreement" and, as amended hereby and as from time
to time further amended, supplemented or otherwise modified, the
"Revolving Credit Agreement"), among each of the subsidiaries of
SPECIALTY FOODS CORPORATION signatory thereto (collectively, the
"Revolving Credit Borrowers"), the several banks and other financial
institutions from time to time parties thereto (collectively, the
"Revolving Credit Lenders") and the Administrative Agent.
W I T N E S S E T H :
WHEREAS, the Term Loan Borrower, the Administrative Agent and
the Term Loan Lenders wish to amend certain terms of the Existing
Term Loan Agreement in the manner provided for herein; and
WHEREAS, the Revolving Credit Borrowers, the Administrative Agent
and the Revolving Credit Lenders wish to amend certain terms of the Existing
Revolving Credit Agreement in the manner provided for herein;
NOW THEREFORE, in consideration of the premises contained herein,
the parties hereto agree as follows:
SECTION I. Definitions.
1. Defined Terms. Unless otherwise defined in this Amendment,
terms which are defined in the Existing Term Loan Agreement and Existing
Revolving Credit Agreement and used herein are so used as so defined.
Unless otherwise indicated, all Section, subsection and Schedule references
are to the Existing Term Loan Agreement.
SECTION II. Amendment of Certain Terms in Existing Term Loan Agreement.
1. Amendments to Subsection 1.1. (a) The definition of the term
"Applicable Margin" contained in subsection 1.1 of the Existing Term
Loan Agreement is hereby amended to read in its entirety as follows:
"'Applicable Margin': for each Type of Term Loan, (a) until
the Third Amendment Effective Date, the rate per annum set forth
under the relevant column heading below:
ABR Loans Eurodollar Loans
1-1/2% 2-1/2%
and (b) from and including the Third Amendment Effective Date,
the rate per annum set forth under the relevant column heading below:
ABR Loans Eurodollar Loans
1-3/4% 2-3/4%
(b) Subsection 1.1 of the Existing Term Loan Agreement is hereby
amended by adding thereto the following definitions, each in its proper
alphabetical order:
"'Collateral Investment Account': as defined in the
Collateral Investment Agreement."
"'Collateral Investment Agreement': a Collateral Investment
Agreement executed and delivered by the Term Loan Borrower and
the Administrative Agent in connection with the Third Amendment,
in form and substance satisfactory to the Administrative Agent,
pursuant to which (a) the Term Loan Borrower shall, on any
date after the Third Amendment Effective Date on which (i) the
Term Loan Borrower receives Net Proceeds from Asset Sales and
(ii) there are no Revolving Credit Loans or Swing Line Loans
outstanding under the Revolving Credit Agreement, deposit such
Net Proceeds (or the portion thereof remaining after any use
thereof to prepay Revolving Credit Loans, Swing Line Loans and Term
Loans) in the Collateral Investment Account for investment and
reinvestment in Cash Equivalents as provided therein, (b) the Term
Loan Borrower shall grant a security interest in the cash and
investments and reinvestments from time to time in the Collateral
Investment Account to the Administrative Agent for the ratable
benefit of the Term Loan Lenders and the Revolving Credit Lenders
and (c) the Term Loan Borrower shall be permitted withdrawals from the
Collateral Investment Account in order to prepay the Term Loans or,
to the extent required by subsection 2.10(b) of the Revolving Credit
Agreement, to prepay the Revolving Credit Loans and Swing Line Loans
and reduce the Revolving Credit Commitments and, except when a Default
or Event of Default shall have occurred and be continuing or when the
Available Revolving Credit Commitments shall be greater than
$10,000,000, for Permitted Third Amendment Purposes and for other
general corporate purposes permitted under this Agreement. "
"'Third Amendment': the Third Amendment, dated as of
October 24, 1996, to this Agreement and the Revolving Credit Agreement."
"'Third Amendment Effective Date': as defined in the Third
Amendment."
"'Permitted Third Amendment Purposes': as defined in the
Third Amendment."
2. Amendment of Subsection 6.1(a) (Consolidated Total
Indebtedness to Consolidated EBITDA). The Administrative Agent and the
Term Loan Lenders hereby amend the entry under the column entitled, "Ratio"
in subsection 6.1(a) of the Existing Term Loan Agreement corresponding
to the 3rd Fiscal Quarter in Fiscal Year 1996 to be 6.65.
3. Amendment of Subsection 6.1(b) (Interest Coverage). The
Administrative Agent and the Term Loan Lenders hereby amend the entry under
the column entitled, "Ratio" in subsection 6.1(b) of the Existing Term Loan
Agreement corresponding to the 3rd Fiscal Quarter in Fiscal Year 1996 to
be 1.25.
4. Amendment of Subsection 6.1(c) (Fixed Charge Coverage).
The Administrative Agent and the Term Loan Lenders hereby amend the entry
under the column entitled, "Fixed Charge Coverage Ratio" in subsection
6.1(c) of the Existing Term Loan Agreement corresponding to the 3rd Fiscal
Quarter in Fiscal Year 1996 to be 0.80.
SECTION III. Amendments to Existing Revolving Credit Agreement.
1. Amendment to Subsection 1.1. (a) The definition of the term
"Applicable Margin" contained in subsection 1.1 of the Existing Revolving
Credit Agreement is hereby amended to read in its entirety as follows:
"'Applicable Margin': (a) for each Type of Revolving Credit
Loan and Swing Loan, until the Third Amendment Effective Date,
the rate per annum set forth under the relevant column heading below:
ABR Loans Eurodollar Loans
Revolving Credit 1-1/2% 2-1/2%
Loan
Swing Line Loan 1-1/2% N/A
(b) from and including the Third Amendment Effective Date, the rate
per annum set forth under the relevant column heading below:
ABR Loans Eurodollar Loans
Revolving Credit 1-3/4% 2-3/4%
Loan
Swing Line Loan 1-3/4% N/A
2. Amendments to Term Loan Agreement. In accordance with
subsection 9.1 of the Existing Term Loan Agreement and subsection 9.1 of
the Existing Revolving Credit Agreement, each of the Revolving Credit
Borrowers and the Lenders parties to this Amendment consents and agrees to
the amendment of terms of the Term Loan Agreement pursuant to this Amendment,
and each of the Revolving Credit Borrowers agrees to comply with the provisions
of Section 6 of the Revolving Credit Agreement, with the references therein
to the Term Loan Agreement being deemed to be references to the Term Loan
Agreement as amended hereby.
SECTION IV. Asset Sales.
In order to induce the Lenders to enter into this Third Amendment
and by the execution and delivery of the Third Amendment, the Term Loan
Borrower hereby agrees that:
(a) Upon the receipt after the Third Amendment Effective Date
by the Term Loan Borrower or any of its Subsidiaries of any Asset Sale
Proceeds under and as permitted by subsection 6.6(e) of the Term Loan
Agreement, to the extent that the Term Loan Borrower does not elect to
immediately use such Net Proceeds to repay the Term Loans as provided in
subsection 2.6 of the Term Loan Agreement or, to the extent required by
subsection 2.10(b) of the Revolving Credit Agreement, to prepay the
Revolving Credit Loans and to reduce the Revolving Credit Commitments:
(i) the Term Loan Borrower shall use such Net Proceeds,
or cause such Net Proceeds to be used, whenever there are Revolving
Credit Loans or Swing Line Loans outstanding under the Revolving
Credit Agreement, to immediately make optional prepayments thereof,
with the Available Revolving Credit Commitments being created by
such prepayments to be available for purposes permitted under the
Revolving Credit Agreement and the Term Loan Agreement; and
(ii) the Term Loan Borrower shall use such Net Proceeds,
whenever there are no Revolving Credit Loans or Swing Line Loans
outstanding under the Revolving Credit Agreement to make a deposit
of such Net Proceeds in the Collateral Investment Account, for
subsequent use thereof upon withdrawal therefrom, for the
Permitted Third Amendment Purposes or to prepay the Term Loans or,
to the extent required by subsection 2.10(b) of the Revolving
Credit Agreement, to prepay the Revolving Credit Loans and to
reduce the Revolving Credit Commitments or for other general
corporate purposes permitted by the Term Loan Agreement or the
Revolving Credit Agreement, except when a Default or Event of
Default shall have occurred and be continuing or the Available
Revolving Credit Commitments shall be greater than $10,000,000.
(b) Except with the consent of the Required Lenders, the
Term Loan Borrower shall not use the Net Cash Proceeds of any Asset
Sale received after the Third Amendment Effective Date to consummate
one or more Acquisitions or to make Capital Expenditures or invest in
other long-term assets of the Operating Subsidiaries as provided for
in subsection 6.6(e) of the Term Loan Agreement that are not permitted
to be made under the first sentence of subsection 6.8 of the Existing
Term Loan Agreement, provided that, if and to the extent that the
aggregate Net Proceeds of all Asset Sales received after the Third
Amendment Effective Date are within one of the categories specified
below, the portion of such aggregate Net Proceeds set forth in Column I
opposite such category may be used for Capital Expenditures permitted
only by reason of the last sentence of subsection 6.8 of the Existing
Term Loan Agreement ("Incremental Capital Expenditures") or for
Acquisitions, with the amount of such portion which may be used for
Acquisitions being limited to the amount set forth in Column II opposite
such category (such permitted Incremental Capital Expenditures and
Acquisitions, the "Permitted Third Amendment Purposes"):
Column I Column II
Category of Aggregate Net Cash Proceeds
from Assets Sales received after the Incremental Capital Acquisition
Third Amendment Effective Date Expenditures Sublimit
More than $250,000,000 $40,000,000 $15,000,000
More than $150,000,000 but Less than $30,000,000 $10,000,000
or Equal to $250,000,000
More than $75,000,000 but Less than $20,000,000 $10,000,000
or Equal to $150,000,000
Less than or Equal to $75,000,000 $10,000,000 $0
(c) Failure by the Term Loan Borrower to comply with any of the
provisions of this Section IV shall constitute an Event of Default under
the Revolving Credit Agreement and the Term Loan Agreement.
SECTION V. Miscellaneous Provisions.
1. Consent to Amendment. Each Lender executing and delivering this
Amendment hereby consents to the agreements and amendments provided for herein.
2. Conditions Precedent. (a) This Amendment shall, become effective
on and as of the date first written above (the "Third Amendment Effective
Date"), provided that each of the conditions precedent set forth below shall
have been waived by or fulfilled to the satisfaction of the Administrative
Agent on or prior to such date:
(i) Amendment. The Administrative Agent shall have received
counterparts of this Amendment, duly executed by the Term Loan Borrower, the
Revolving Credit Borrowers and the Administrative Agent, and consented to by
the requisite Lenders under the Term Loan Agreement and the Revolving Credit
Agreement.
(ii) Amendment Documents. The Administrative Agent shall have
received each of the following (together with this Amendment, the "Amendment
Documents"):
a) Consents to Security Documents and Guarantees. A Consent,
with a counterpart for each Lender, in form and substance reasonably
satisfactory to the Administrative Agent, from each party to any
Security Document acknowledging and consenting to the execution,
delivery and performance of this Amendment and the transactions
contemplated hereby, in each case, executed and delivered by a duly
authorized officer of such party; and
b) Collateral Investment Agreement. The Collateral Investment
Agreement, in form and substance satisfactory to the Administrative
Agent duly executed and delivered by the Term Loan Borrower.
(iii) Corporate Proceedings of the Term Loan Borrower. The
Administrative Agent shall have received a copy of the resolutions, in
form and substance reasonably satisfactory to the Administrative Agent,
of the Board of Directors of the Term Loan Borrower authorizing or
confirming the execution, delivery and performance of the Amendment
Documents to which it is a party certified by the Secretary or an Assistant
Secretary of the Term Loan Borrower as of the Third Amendment Effective
Date and each such certificate shall state that the resolutions thereby
certified have not been amended, modified, revoked or rescinded as of
the date of such certificate.
(iv) No Default or Event of Default. On and as of the Third
Amendment Effective Date and after giving effect to this Amendment, no
Default or Event of Default shall have occurred and be continuing except
to the extent and only to the extent waived herein.
(v) Representations and Warranties. The representations and
warranties made by the Term Loan Borrower in the Term Loan Agreement after
giving effect to this Amendment and the transactions contemplated hereby
shall be true and correct in all material respects on and as of the Third
Amendment Effective Date as if made on such date, except where such
representations and warranties relate to an earlier date in which case such
representations and warranties shall be true and correct in all material
respects as of such earlier date and except to the extent and only to the
extent waived herein; provided that all references to the Term Loan
Agreement in such representations and warranties shall be and are deemed
to mean this Amendment as well as the Term Loan Agreement as amended
hereby.
(vi) Certificate. The Administrative Agent shall have received a
Certificate of a Responsible Officer of the Term Loan Borrower certifying
the matters referred to in paragraphs (iv) and (v) above.
(vii) Other. The Administrative Agent shall have received copies
of opinions, certificates, or agreements as shall reasonably be requested
by the Administrative Agent or the Required Lenders.
3. Continuing Effect; No Other Amendments. Except as expressly
amended hereby, all of the terms and provisions of the Term Loan Agreement
and the Revolving Credit Agreement are and shall remain in full force and
effect.
4. Expenses. The Term Loan Borrower and the Revolving Credit
Borrowers agree to reimburse the Administrative Agent for all its reasonable
costs and out-of-pocket expenses incurred in connection with the preparation
and delivery of this Amendment, including, without limitation, the reasonable
fees and disbursements of counsel to such Administrative Agent.
5. Counterparts. This Amendment may be executed in any number
of counterparts by the parties hereto, each of which counterparts when so
executed shall be an original, but all counterparts taken together shall
constitute one and the same instrument.
6. GOVERNING LAW. THIS AMENDMENT SHALL BE GOVERNED BY, AND CONSTRUED
AND INTERPRETED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
* * *
IN WITNESS WHEREOF, the parties hereto have caused this Amendment
to be executed and delivered by their respective duly authorized officers as
of the date first above written.
SPECIALTY FOODS CORPORATION,
as Term Loan Borrower
BY:
Name:
Title:
B & G - DSD HOLDINGS, INC.,
as Revolving Credit Borrower
BY:
Name:
Title:
BELSEA HOLDINGS INC.,
as Revolving Credit Borrower
BY:
Name:
Title:
▇▇▇▇▇ & ▇▇▇▇▇▇, INC.,
as Revolving Credit Borrower
BY:
Name:
Title:
H & M FOOD SYSTEMS COMPANY, INC.,
as Revolving Credit Borrower
BY:
Name:
Title:
▇▇▇▇ HOLDINGS, INC., as Revolving
Credit Borrower
BY:
Name:
Title:
MOTHER'S CAKE AND COOKIE CO.,
as Revolving Credit Borrower
BY:
Name:
Title:
SFFB HOLDINGS, INC.,
as Revolving Credit Borrower
BY:
Name:
Title:
STELLA HOLDINGS, INC., formerly
known as Stella Foods, Inc., as
Revolving Credit Borrower
BY:
Name:
Title:
THE BAGEL PLACE, INC., as
Revolving Credit Borrower
BY:
Name:
Title:
THE CHASE MANHATTAN BANK (formerly,
Chemical Bank), as Administrative
Agent and as a Lender
BY:
Name:
Title:
CONSENTED TO:
ABN AMRO Bank N.V.
By: ABN AMRO North America, Inc.,
as agent
BY:
Name:
Title:
BY:
Name:
Title:
BANK OF AMERICA ILLINOIS
BY:
Name:
Title:
THE BANK OF NEW YORK
BY:
Name:
Title:
BANQUE FRANCAISE DU COMMERCE
EXTERIEUR
BY:
Name:
Title:
BY:
Name:
Title:
BANQUE PARIBAS
BY:
Name:
Title:
BY:
Name:
Title:
CAISSE NATIONALE DE CREDIT AGRICOLE
BY:
Name:
Title:
CERES FINANCE LTD
By: Chancellor Senior Secured
Management, Inc. as Financial Manager
BY:
Name:
Title:
COMPAGNIE FINANCIERE DE CIC ET DE
L'UNION EUROPEENNE
BY:
Name:
Title:
BY:
Name:
Title:
FIRST INTERSTATE BANK OF TEXAS, N.A.
BY:
Name:
Title:
THE FIRST NATIONAL BANK OF BOSTON
BY:
Name:
Title:
▇▇▇▇▇▇▇ ▇▇▇▇▇ PRIME RATE PORTFOLIO
By: ▇▇▇▇▇▇▇ ▇▇▇▇▇ Asset Management,
L.P., as Investment Advisor
BY:
Name:
Title:
▇▇▇▇▇▇▇ ▇▇▇▇▇ SENIOR FLOATING RATE
FUND, INC.
BY:
Name:
Title:
NATIONSBANK OF TEXAS N.A.
BY:
Name:
Title:
COOPERATIVE CENTRALE RAIFFISEN -
BOERENLEENBANK B.A., "RABOBANK
NEDERLAND", NEW YORK BRANCH
BY:
Name:
Title:
BY:
Name:
Title:
SENIOR HIGH INCOME PORTFOLIO, INC.
BY:
Name:
Title:
SOCIETE GENERALE, SOUTHWEST
AGENCY
BY:
Name:
Title:
STRATA FUNDING LTD.
By: Chancellor Senior Secured
Management, Inc. as Financial Manager
BY:
Name:
Title:
▇▇▇▇▇ FARGO BANK, N.A.
BY:
Name:
Title:
SENIOR DEBT PORTFOLIO
By: Boston Management and Research
as Investment Advisor
BY:
Name:
Title:
ACKNOWLEDGMENT AND CONSENT
ACKNOWLEDGMENT AND CONSENT, dated as of October 24, 1996, to Third
Amendment, dated as of October 24, 1996 (the "Amendment") to: (a) the Term Loan
Agreement, dated as of July 17, 1995, (as may have been amended, supplemented,
waived or otherwise modified prior to the date hereof, the "Existing Term Loan
Agreement" and, as amended hereby and as from time to time further amended,
supplemented or otherwise modified, the "Term Loan Agreement") among SPECIALTY
FOODS CORPORATION, a Delaware corporation (the "Term Loan Borrower"), the
several banks and other financial institutions from time to time parties
thereto (the "Term Loan Lenders"), and CHEMICAL BANK, a New York banking
corporation, as administrative agent (the "Administrative Agent"); and (b) the
Revolving Credit Agreement dated as of August 16, 1993 and amended and restated
as of July 17, 1995 (as amended and restated and as the same may have been
further amended, supplemented, waived or otherwise modified prior to the date
hereof, the "Existing Revolving Credit Agreement" and, as amended hereby and
as from time to time further amended, supplemented or otherwise modified, the
"Revolving Credit Agreement"), among each of the subsidiaries of SPECIALTY
FOODS CORPORATION signatory thereto (collectively, the "Revolving Credit
Borrowers"), the several banks and other financial institutions from time
to time parties thereto (collectively, the "Revolving Credit Lenders") and
the Administrative Agent.
W I T N E S S E T H :
WHEREAS, the Amendment provides that the Administrative Agent shall
have received, with a counterpart for each Term Loan Lender, a Consent, in form
and substance reasonably satisfactory to the Administrative Agent, of each
party to any Security Document acknowledging and consenting to the execution,
delivery and performance of the Amendment and the transactions contemplated
thereby, in each case, executed and delivered by a duly authorized officer of
such party;
NOW, THEREFORE, the undersigned hereby agree as follows:
1. The undersigned hereby acknowledge and consent to the execution,
delivery and performance of the Amendment and the transactions
contemplated thereby.
2. Terms defined in the Existing Term Loan Agreement, the Existing
Revolving Credit Agreement and the Amendment shall have their defined
meanings when used herein.
IN WITNESS WHEREOF, the undersigned have caused this Supplement
to be executed and delivered by a duly authorized officer on the date first
above written.
MBC Holdings, Inc.
▇▇▇▇ Holdings, Inc.
▇▇▇▇ Baking Company, an Iowa corp.
▇▇▇▇ Baking Company, a Delaware corp.
The Bagel Place, Inc.
BGH Holdings, Inc.
B&G-DSD Holdings, Inc.
B&G Foods, Inc.
Roseland Manufacturing, Inc.
▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇▇▇▇, Inc.
BRH Holdings, Inc.
▇▇▇▇▇ & ▇▇▇▇▇▇, Inc.
MCC-DSD Holdings, Inc.
Mother's Cake & Cookie Co.
HMFS Holdings, Inc.
H&M Food Systems Company, Inc.
WFB Holdings, Inc.
Pacific Coast Baking Co., Inc.
Belsea Holdings, Inc.
Gai's Seattle French Baking Company
▇▇▇▇▇▇▇▇▇▇ Baking Co. of Seattle, Inc.
General Bagels Corporation
Oregon French Baking Corporation
Seattle English Muffin Company
SFFB Holdings, Inc.
San ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ Bread Company
Andre-Boudin Bakeries, Inc.
Fisherman's Wharf Sourdough French Bread
Bakeries, Inc.
Boudin International, Inc.
▇▇▇▇▇ ▇▇▇▇ of America
Steve's Drayage, Inc.
San Francisco Sourdough Bakeries, Inc.
Larraburu Bakery
Parisian Bakeries, Inc.
San Francisco Baking Cultures
San Francisco Sourdough Company
San Francisco Bay Area Equipment and Supply
Stella Holdings, Inc.
Stella Foods East, Inc.
Stella Foods, Inc.
Stella Cheese Company, Inc.
GWI Holdings, Inc.
GWI, Inc.
By:
Name:
Title:
Accepted as of the date first
above written:
SPECIALTY FOODS CORPORATION
By:
Name:
Title: