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SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) December 21, 1994
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THE GRAND UNION COMPANY
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(Exact Name of Registrant as Specified in Charter)
Delaware 33-59438 22-1518276
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(State of Other Jurisdiction (Commission (I.R.S. Employer
of Incorporation) File Number) Identification No.
201 Willowbrook Boulevard, Wayne, New Jersey 07470-0966
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(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code (201) 890-6000
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(Former name or former address, if changed since last report)
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Item 5. OTHER EVENTS
On December 21, 1994, The Grand Union Company issued the press release
attached hereto as Exhibit A.
Item 7. FINANCIAL STATEMENTS AND EXHIBITS
(a) FINANCIAL STATEMENTS OF BUSINESSES ACQUIRED
(b) PRO FORMA FINANCIAL INFORMATION
(c) EXHIBITS
10.8H Limited Waiver and Agreement, dated as of
December 6, 1994, among Grand Union Holdings
Corporation ("Holdings"), Grand Union Capital
Corporation ("Capital"), The Grand Union Company
("Grand Union"), the lending institutions party
to the Credit Agreement, dated as of July 14, 1992,
among Grand Union, Capital, Holdings, the lending
institutions party thereto, Bankers Trust Company
("Bankers Trust"), as Agent, and Midlantic
National Bank, as Co-Agent, filed as Exhibit No. 10.8
to the Registration Statement on Form S-1 of
Capital and Holdings (Registration No. 33-50496),
and Bankers Trust, as agent.
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EXHIBIT A
"WAYNE, N.J., Dec. 21, 1994 - The Grand Union Company announced today that
its lending banks have entered into a Limited Waiver and Agreement which waives
any event of default which might exist under the Company's Bank Credit Agreement
should the Company fail to make payments of interest due on January 15, 1995, in
respect of the Senior and Senior Subordinated Notes of the Company. This
agreement also waives compliance with certain covenants in the Bank Credit
Agreement, thereby permitting the Company to continue to make borrowings in
ordinary course under its revolving line of credit through February 14, 1995.
"As we had expected, our bank lenders have demonstrated support for our
restructuring process," stated Gary D. Hirsch, Chairman of the Board. "In
addition to the action by our bank lenders, and the earlier support shown by our
vendors, the informal committees of bondholders of the Company which have been
formed have expressed similar support of the restructuring process and our
valuable trade relationships." Mr. Hirsch noted that the continued
effectiveness of the banks' waiver is conditioned on there being no materially
negative change in the trade terms being extended to the Company by its vendors.
"Grand Union had previously announced that it intended to propose a
restructuring plan to its security holders by January 15, 1995. In today's
announcement of its lending banks' actions, the Company noted that it does not
expect to make the interest payments due in January on certain of the Company's
outstanding notes.
"Mr. Hirsch added "The Company believes that it has identified and reacted
to its financial situation in a responsible manner designed to preserve value
for our security holders. The actions taken thus far by our vendors and lending
banks reflect support for the approach taken by the Company. We intend to
continue to carry the restructuring through to completion on a basis which
preserves and justifies the support which we have thus far received."
"Grand Union currently operates 241 retail food stores in six Northeastern
states."
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SIGNATURES
Pursuant to the requirements of the Securities
Exchange Act of 1934, the registrant has duly caused this
report to be signed on its behalf by the undersigned
thereunto duly authorized.
THE GRAND UNION COMPANY
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(Registrant)
Date: December 22, 1994 /s/ Kenneth R. Baum
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Kenneth R. Baum
Senior Vice President,
Chief Financial Officer
and Secretary (Principal
Financial Officer and
Principal Accounting Officer)
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[CONFORMED COPY]
LIMITED WAIVER AND AGREEMENT
LIMITED WAIVER AND AGREEMENT ("Agreement"), dated as of December 6,
1994, among Grand Union Holdings Corporation (formerly known as GND Holdings
Corporation) ("Holdings"), Grand Union Capital Corporation ("GU Capital"), The
Grand Union Company (the "Company"; and together with Holdings, GU Capital and
each Person referred to in clause (ii) of Section 5(b) hereof, the members of
the "GU Group"), the lending institutions party to the Credit Agreement referred
to below (the "Banks") and Bankers Trust Company, as agent (in such capacity,
the "Agent"). All capitalized terms used herein and not otherwise defined shall
have the respective meanings provided such terms in the Credit Agreement
referred to below.
RECITALS
WHEREAS, each member of the GU Group, the Banks, the Agent and
Midlantic Bank, N.A., as co-agent (the "Co-Agent"), are parties to a Credit
Agreement, dated as of July 14, 1992, as amended on seven occasions the most
recent of which was as of September 15, 1994 (as so amended, the "Credit Agree-
ment"); and
WHEREAS, each member of the GU Group has requested that the Banks con-
sent to a limited waiver of certain of the provisions of the Credit Agreement
specified herein, and the Required Banks have consented to provide such limited
waiver on the terms set forth herein.
LIMITED WAIVER AND AGREEMENT
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereto agree as
follows:
1. LIMITED WAIVER. The Banks hereby waive through the Limited Waiver
Termination Date (as defined below):
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(a) Each Event of Default, if any, arising under Section 9.03 of the
Credit Agreement as a result of the failure of Holdings to comply with
the provisions of Section 8.09 of the Credit Agreement requiring that
EBITDA for the four consecutive fiscal quarters (taken as one ac-
counting period) ending on January 7, 1995 not be less than
$187,500,000;
(b) Each Event of Default, if any, arising under Section 9.03 of the
Credit Agreement as a result of the failure of Holdings to comply with
the provisions of Section 8.11 of the Credit Agreement requiring that
the ratio of EBITDA to Total Cash Interest Expense for the four con-
secutive fiscal quarters (taken as one accounting period) ending on
January 7, 1995 not be less than 1.25:1;
(c) Each Event of Default, if any, arising under Section 9.04 of the Cred-
it Agreement solely as a result of Holdings' or any of its Subsidiar-
ies', as the case may be, default in the payment of interest due on
January 15, 1995 with respect to (i) the Company's 11-1/4% Senior
Notes due July 15, 2000 issued pursuant to the Indenture, dated as
of July 22, 1992, among the Company, as issuer, Holdings and GU
Capital as guarantors, and First Trust National Association, as
trustee, (ii) the Company's 12-1/4% Senior Subordinated Notes due
July 15, 2002 issued pursuant to the Indenture, dated as of
July 22, 1992, among the Company, as issuer, Holdings and GU Capital,
as guarantors, and United States Trust Company of New York, as
trustee, and (iii) the Company's 12-1/4% Senior Subordinated Notes
due July 15, 2002, Series A issued pursuant to the Indenture, dated
as of October 18, 1993, among the Company, as issuer, GU Capital, as
guarantor, and United States Trust Company of New York, as trustee;
and
(d) The effect, if any, of the matters specifically disclosed in the
Company's press release issued on November 29, 1994 on Section 6.11(c)
of the Credit Agreement attached hereto as Exhibit A,
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but excluding any future events arising from or contemplated by such
disclosed matters.
The matters described in subsections (a) through (d) of this Section 1 are
collectively referred to herein as the "Waived Events").
As used herein, the term "Limited Waiver Termination Date" shall mean,
notwithstanding anything to the contrary contained herein, the earliest of (a)
February 14, 1995, (b) the date, if any, on which a Default (including, without
limitation, the filing of any case or petition relating to bankruptcy,
insolvency or any similar proceeding in any federal or state court) or an Event
of Default under any of the Credit Documents or any document referred to therein
(other than a Waived Event subject to a then effective limited waiver pursuant
to this Section 1) shall have occurred, (c) the date, if any, on which any one
or more members of the GU Group shall fail to comply with any of their agree-
ments or undertakings under this Agreement or it is determined that any repre-
sentation, warranty or statement made by any one or more members of the GU Group
herein or in any document delivered pursuant hereto shall prove to be untrue on
the date as of which made or deemed made, (d) the date, if any, on which any
creditor of (or representative thereof) or claimant against any one or more mem-
bers of the GU Group (including, without limitation, the creditors referred to
in Section 1(c) hereof) shall accelerate (or attempt to accelerate) any indebt-
edness or other obligations of any one or more members of the GU Group or shall
commence any proceedings, or take any action, to move or foreclose against any
asset or assets of any one or more members of the GU Group or any of their
respective Subsidiaries and (e) the date, if any, on which the level of, or the
terms under which, usual and ordinary course trade credit provided by vendors to
any one or more members of the GU Group or any of their respective Subsidiaries,
if any, is materially reduced, or become materially less favorable, as deter-
mined by the Agent and the Required Banks.
2. BUSINESS PLAN. In consideration for the limited waiver granted
by the Banks pursuant to Section 1 of the Agreement, each member of the GU Group
agrees to deliver to the Agent a formal business plan for Holdings and its Sub-
sidiaries as soon as practicable and in any event on or prior to January 17,
1995. The business plan
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shall include such financial, operational and other information as may be
necessary under the present and anticipated future circumstances of each member
of the GU Group to demonstrate the feasibility of each member of the GU Group's
continued business enterprise, including both restructuring and recapitalization
plans.
3. EFFECT OF LIMITED WAIVER.
(a) Upon the occurrence of the Limited Waiver Termination Date, the
limited waivers contained in Section 1 hereof shall terminate in their entirety
and all rights available to the Agent and the Banks prior to the effectiveness
of this Agreement shall be reinstated in full as if this Agreement were never
entered into. Each member of the GU Group hereby acknowledges that, upon the
occurrence of the Limited Waiver Termination Date, the Agent and the Banks shall
be entitled to exercise all rights and remedies available to them under the
Credit Agreement, the other Credit Documents and/or applicable law, including,
without limitation, those applicable to the Waived Events.
(b) Each member of the GU Group further acknowledges the Agent's and
the Banks' ability to exercise any and all rights and remedies available to them
under the Credit Agreement, the other Credit Documents and/or applicable law
with respect to the Waived Events, in each case, upon the occurrence or continu-
ance of any Default or Event of Default, other than the Waived Events. Each
member of the GU Group further acknowledges and agrees that the limited waivers
contained in Section 1 hereof shall not be construed as a waiver of compliance
with any term or condition contained in the Credit Agreement or the other Credit
Documents, nor as an agreement to forbear with respect to any such term or
condition, other than as expressly set forth in Section 1 hereof.
(c) Without limitation of any of the foregoing, each member of the GU
Group acknowledges and agrees that neither BTCo nor the Banks shall have any
obligation to make advances or Loans and the Letter of Credit Issuer shall have
no obligation to issue Letters of Credit after the Limited Waiver Termination
Date, regardless of the compliance of any member of the GU Group with the terms
and conditions contained in this Agreement, unless on the Limited Waiver
Termination Date no Default or Event of
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Default exists and each member of the GU Group is otherwise in compliance with
all of the Credit Documents (unless waived at any time in accordance with the
Credit Documents).
4. COOPERATION. Each member of the GU Group agrees that it will
cooperate, on a reasonable basis, with the Agent and its collective agents,
consultants, appraisers and attorneys in connection with both the financing
arrangement extended pursuant to the Credit Agreement and the business plan to
be submitted as provided herein. In connection with its obligation to
cooperate, each member of the GU Group shall use its best efforts to furnish the
parties described in the previous sentence with such relevant information as
they may request. The provisions of this Section are in addition to and shall
not operate to modify or waive any right or obligation under the Credit
Agreement or the other Credit Documents.
5. MISCELLANEOUS.
(a) In order to induce the Agent and the Banks to enter into this
Agreement, each member of the GU Group hereby represents and warrants that (i)
no Default or Event of Default exists on the date hereof, both before and after
giving effect to this Agreement, and (ii) all of the representations and warran-
ties contained in the Credit Documents are true and correct in all material
respects on the date hereof after giving effect to this Agreement with the same
effect as though such representations and warranties had been made on and as of
the date hereof (it being understood that any representation or warranty made as
of a specific date shall be true and correct in all material respects as of such
specific date).
(b) This Agreement may be executed in one or more counterparts, and
any party to this Agreement may execute and deliver this Agreement by executing
and delivering any of such counterparts, each of which when executed and deliv-
ered shall be deemed to be an original and all of which taken together shall
constitute but one and the same agreement. This Agreement shall become effec-
tive as of December 6, 1994, on the date that (i) each member of the GU Group
and the Required Banks shall have signed a copy hereof and shall have delivered
(in-
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cluding by way of telecopier) the same to the Agent at its Notice Office, (ii)
each Person which has obligated itself or its assets in respect of the
obligations of any member of the GU Group under or in respect of the Credit
Agreement shall have consented in writing hereto pursuant to documentation in
form and substance satisfactory to the Agent and (iii) the Banks shall have re-
ceived a favorable opinion with respect to the enforceability of this Agreement
of Donovan Leisure Newton & Irvine as to each member of the GU Group, in form
and substance satisfactory to the Agent.
(c) Each member of the GU Group agrees to pay on demand all costs and
expenses of the Agent, the Co-Agent and the Banks in connection with the
negotiation, preparation, execution, delivery and performance of this Agreement
and the other documents delivered hereunder, including, without limitation, the
fees and out-of-pocket expenses of counsel, financial advisors and other profes-
sionals for the Agent, the Co-Agent and the Banks and the out-of-pocket expenses
of the Agent, the Co-Agent and the Banks.
(d) This Agreement shall be binding upon and inure to the benefit of
the parties hereto and their respective successors and assigns.
(e) This Agreement is limited as specified and shall not constitute a
waiver (except to the extent specified in Section 1 hereof) or a modification of
any provision of the Credit Agreement or any other Credit Document.
(f) No failure or delay on the part of any party hereto to exercise
any right, power or privilege hereunder or under any instrument executed
pursuant hereto shall operate as a waiver nor shall any single or partial
exercise of any right, power or privilege preclude any other or further exercise
thereof or the exercise of any other right, power or privilege.
(g) The obligations of each member of the GU Group pursuant to Sec-
tion 4 and Section 5(c) hereof and the acknowledgements and agreements of each
of them set forth in Section 3 hereof shall survive the occurrence of the Limit-
ed Waiver Termination Date.
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(h) Section, titles, captions and headings used herein are inserted
only as a matter of convenience and for reference, and in no way define, limit,
extend or describe the scope of this Agreement or the intent of any provision
hereof.
(i) From and after the date on which this Agreement shall become
effective in accordance with the terms hereof, all references in the Credit
Agreement and each of the other Credit Documents to the Credit Agreement shall
be deemed to be references to the Credit Agreement after giving effect to this
Agreement. The Credit Agreement and the other Credit Documents are and shall
continue to be in full force and effect and are hereby in all respects ratified
and confirmed.
(j) THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES
HEREUNDER SHALL BE CONSTRUED IN ACCORDANCE WITH AND SHALL BE GOVERNED BY THE
LAWS OF THE STATE OF NEW YORK (WITHOUT GIVING EFFECT TO THE PRINCIPLES THEREOF
RELATING TO CONFLICTS OF LAW EXCEPT SECTION 5-1401 OF THE NEW YORK OBLIGATIONS
LAW).
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IN WITNESS WHEREOF, each of the parties hereto has caused a
counterpart of this Amendment to be duly executed and delivered as of the date
first above written.
Address: GRAND UNION HOLDINGS
26 Meadow Road CORPORATION
Riverside, CT 06878
Telephone: (203) 637-8245 By: /s/ Gary D. Hirsch
Facsimile: (203) 637-0511 -------------------
Title: Chairman
52 Center Street GRAND UNION CAPITAL
Westport, CT 06880 CORPORATION
Telephone: (203) 222-1368
Facsimile: (203) 221-0379 By: /s/ Gary D. Hirsch
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Title: Chairman
201 Willowbrook Boulevard THE GRAND UNION COMPANY
Wayne, NJ 07470-6799
Attn: Kenneth Baum
Telephone: (201) 890-6000
Facsimile: (201) 890-6540 By: /s/ Gary D. Hirsch
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Title: Chairman
280 Park Avenue BANKERS TRUST COMPANY,
New York, NY 10017 Individually and as
Attention: Mary Kay Coyle Agent
Telephone: (212) 250-9094
Facsimile: (212) 250-7200 By: /s/ Mary Kay Coyle
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Title: Vice President
499 Thornall Street MIDLANTIC BANK, N.A.
Edison, NJ 08818
Attn: Corporate Banking
9th Floor
Edward M. Tessalone,
Vice President
Telephone: (908) 321-8188 By: /s/ Edward Tessalone
Facsimile: (908) 321-2144 --------------------
Title: Vice President
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c/o Dean Witter Intercapital PRIME INCOME TRUST
2 World Trade Center
72nd Floor
New York, NY 10048
Attn: Rafael Scolari By: /s/ Rafael Scolari
Louis Pistecchia ---------------------
Telephone: (212) 392-5686 Title: Investment Manager
(212) 392-5845
Facsimile: (212) 392-5345
520 Madison Avenue COMPAGNIE FINANCIERE DE CIC
37th Floor ET DE L'UNION EUROPEENNE
New York, NY 10022
Attn: Sean Mounier
Telephone: (212) 715-4413 By: /s/ Marcus Edward
Facsimile: (212) 715-4535 ---------------------
Title: Vice President
By: /s/ Dora DeBlasi Hyduk
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Title: Vice President
550 Broad Street FIRST FIDELITY BANK, N.A.
5th Floor NEW JERSEY
Newark, NJ 07102
Attn: Robert Strunk
Telephone: (201) 565-6663
Facsimile: (201) 565-6681 By:
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Title:
1 South Wacker Drive SANWA BUSINESS CREDIT
Suite 2800 CORPORATION
Chicago, IL 60606
Attn: Greg Cooper
Barbara Horton By: /s/ Lawrence J. Placek
Telephone: (312) 853-1401 ----------------------
Facsimile: (312) 782-6035 Title: Vice President
470 Park Avenue South BANK POLSKA KASA OPIEKI, SA
New York, NY 10016
Attn: William Shea
Telephone: (212) 251-1203 By: /s/ William A. Shea
Facsimile: (212) 213-2971 ----------------------
Title: Vice President
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Merrill Lynch Asset Management SENIOR HIGH INCOME
800 Scudder Mill Road, Area 2C PORTFOLIO, INC.
Plainsboro, NJ 08536
Attn: John Fraser
Telephone: (609) 282-2055
Facsimile: (609) 282-2756 By: /s/ John W. Fraser
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Title: Authorized Signatory
Merrill Lynch Asset Management MERRILL LYNCH SENIOR FLOATING
800 Scudder Mill Road, Area 2C RATE FUND, INC.
Plainsboro, NJ 08536
Attn: John Fraser
Telephone: (609) 282-2055
Facsimile: (609) 282-2756 By: /s/ John W. Fraser
----------------------
Title: Authorized Signatory
Merrill Lynch Asset Management MERRILL LYNCH PRIME RATE
800 Scudder Mill Road, Area 2C PORTFOLIO
Plainsboro, NJ 08536 (d/b/a Merrill Lynch Senior
Attn: John Fraser Floating Rate Portfolio)
Telephone: (609) 282-2055 By: Merrill Lynch Asset
Facsimile: (609) 282-2756 Management, L.P.,
as Investment Advisor
By: /s/ John W. Fraser
----------------------
Title: Authorized Signatory
One Parkview Plaza VAN KAMPEN MERRITT PRIME
Oak Brook Terrace, IL 60181 RATE INCOME TRUST
Attn: Jeffrey Maillet
Telephone: (708) 684-6438
Facsimile: (708) 684-6740
(708) 684-6741 By: /s/ Jeffrey W. Maillet
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Title: Vice President and
Portfolio Manager
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