<PAGE> Sequential Page 1 of 18
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON D.C. 20549
FORM 10-Q
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended April 8, 1995
or
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from
Commission File No. 1-6068
RINI-REGO SUPERMARKETS, INC.
(Exact name of Registrant as specified in its charter)
Ohio 34-0222970
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
5300 Richmond Road, Bedford Heights, Ohio 44146
(Address of principal executive offices)
Registrant's telephone number, including area code: (216) 292-7000
Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Sections 12, 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months (or
for such shorter period that the registrant was required to file
such reports), and (2) has been subject to such filing requirements
for the past 90 days.
Yes X No
Indicate the number of shares outstanding of each of the issuer's
classes of common stock as of the latest practicable date.
Outstanding at
May 8, 1995
Common Stock, No Par Value 3,536,577
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<TABLE>
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
RINI-REGO SUPERMARKETS, INC AND SUBSIDIARIES
CONSOLIDATED CONDENSED BALANCE SHEETS
(In thousands of dollars)
<CAPTION>
4/8/95 7/2/94
ASSETS ---------- ----------
(unaudited)
<S> <C> <C>
CURRENT ASSETS:
Cash and cash equivalents $ 3,535 $ 4,376
Trade accounts receivable, net 40,603 38,460
Inventories 72,855 74,279
Deferred income taxes 6,583 6,583
Prepaid expenses 5,412 4,838
---------- ----------
128,988 128,536
PROPERTY, EQUIPMENT AND CAPITAL LEASES 182,048 173,841
Less-Allowances for depreciation, amorti-
zation and loss on disposal of fixed assets 66,009 65,308
---------- ----------
116,039 108,533
OTHER ASSETS:
Notes receivable 9,622 10,851
Deferred income taxes 7,062 7,062
Other 2,130 2,535
---------- ----------
18,814 20,448
---------- ----------
TOTAL ASSETS $ 263,841 $257,517
========== ==========
</TABLE>
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<TABLE>
<CAPTION>
4/8/95 7/2/94
---------- ----------
(unaudited)
LIABILITIES AND STOCKHOLDERS' EQUITY
<S> <C> <C>
CURRENT LIABILITIES:
Accounts payable $ 49,819 $ 45,614
Accrued expenses 39,780 29,911
Current portion of long-term liabilities 9,775 10,035
---------- ----------
99,374 85,560
LONG-TERM LIABILITIES:
Debt 57,869 71,274
Capital lease obligations 12,253 12,404
Self insurance reserves 10,714 10,531
OTHER LIABILITIES 11,184 13,067
STOCKHOLDERS' EQUITY:
Preferred Stock--18,044 shares 1,804 1,804
Class A Common Stock--7,125,287 shares 71 71
Class B Common Stock--955,613 shares 10 10
Paid-in capital 35,546 35,546
Retained earnings 35,016 27,250
---------- ----------
72,447 64,681
---------- ----------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 263,841 $257,517
========== ==========
<FN>
The accompanying Notes to Consolidated Condensed Financial
Statements are an integral part of these balance sheets.
</TABLE>
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<TABLE>
RINI-REGO SUPERMARKETS, INC. AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS
(In thousands of dollars, except share and per share data)
(unaudited)
<CAPTION>
40 Weeks Ended 12 Weeks Ended
4/8/95 4/9/94 4/8/95 4/9/94
---------- ---------- ---------- ----------
<S> <C> <C> <C> <C>
NET SALES $ 904,224 $ 858,228 $ 275,405 $ 259,490
COST OF GOODS SOLD 726,073 694,623 220,564 210,276
--------- --------- --------- ---------
Gross profit 178,151 163,605 54,841 49,214
SELLING, GENERAL &
ADMINISTRATIVE EXPENSE 160,168 148,514 48,517 45,114
RESTRUCTURING CHARGE - 12,000 - 12,000
--------- --------- --------- ---------
Operating income (loss) 7,983 3,091 6,324 (7,900)
INTEREST EXPENSE (5,901) (5,855) (1,811) (1,837)
INTEREST INCOME 952 580 310 173
--------- --------- --------- ---------
INCOME (LOSS) BEFORE
CUMULATIVE EFFECT OF
CHANGE IN ACCOUNTING
PRINCIPLE AND INCOME
TAXES 13,034 (2,184) 4,823 (9,564)
PROVISION (CREDIT) FOR
INCOME TAXES 5,160 (790) 1,920 (3,690)
--------- --------- --------- ---------
INCOME (LOSS) BEFORE
CUMULATIVE EFFECT OF
CHANGE IN ACCOUNTING
PRINCIPLE 7,874 (1,394) 2,903 (5,874)
CUMULATIVE EFFECT OF CHANGE
IN ACCOUNTING PRINCIPLE:
Accounting for income
taxes - 6,866 - -
--------- --------- --------- ---------
NET INCOME (LOSS) 7,874 5,472 2,903 (5,874)
LESS PREFERRED STOCK
DIVIDENDS 108 108 36 36
--------- --------- --------- ---------
NET INCOME (LOSS)
APPLICABLE TO COMMON
STOCKHOLDERS $ 7,766 $ 5,364 $ 2,867 $ (5,910)
========= ========= ========= =========
</TABLE>
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<TABLE>
<CAPTION>
40 Weeks Ended 12 Weeks Ended
4/8/95 4/9/94 4/8/95 4/9/94
---------- ---------- ---------- ----------
<S> <C> <C> <C> <C>
PER SHARE DATA:
INCOME (LOSS) BEFORE
CUMULATIVE EFFECT OF
CHANGE IN ACCOUNTING
PRINCIPLE $ .96 $ (.19) $ .35 $ (.73)
CUMULATIVE EFFECT OF
CHANGE IN ACCOUNTING
PRINCIPLE - .85 - -
--------- --------- --------- ---------
NET (LOSS) INCOME $ .96 $ .66 $ .35 $ (.73)
========= ========= ========= =========
COMMON STOCK DIVIDENDS - - - -
========= ========= ========= =========
WEIGHTED AVERAGE NUMBER
OF COMMON SHARES
OUTSTANDING 8,080,900 8,080,901 8,080,900 8,080,901
========= ========= ========= =========
<FN>
The accompanying Notes to Consolidated Condensed Financial
Statements are an integral part of these statements.
</TABLE>
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<TABLE>
RINI-REGO SUPERMARKETS, INC. AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
(In thousands of dollars)
(unaudited)
<CAPTION>
40 Weeks Ended 12 Weeks Ended
4/8/95 4/9/94 4/8/95 4/9/94
--------- --------- --------- ---------
<S> <C> <C> <C> <C>
CASH FLOWS FROM OPERATING
ACTIVITIES:
Net income (loss) $ 7,874 $ 5,472 $ 2,903 $ (5,874)
Adjustments to reconcile
net income (loss) to
net cash provided
by (used for)
operating activities:
Depreciation & amort. 13,489 11,189 4,445 3,436
Cumulative effect of
change in accounting
principle - (6,866) -
Changes in assets
and liabilities 12,231 (15,747) (1,088) (5,605)
--------- --------- --------- ---------
Net cash provided by
(use for) operating
activities 33,594 (5,952) 6,260 (8,043)
--------- --------- --------- ---------
CASH FLOWS FROM INVESTING
ACTIVITIES:
Purchases of fixed
assets (22,487) (19,255) (6,538) (4,201)
Proceeds from sales of
fixed assets 2,110 539 1,947 84
--------- --------- --------- ---------
Net cash used for
investing
activities (20,377) (18,716) (4,591) (4,117)
--------- --------- --------- ---------
</TABLE>
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<TABLE>
<CAPTION>
40 Weeks Ended 12 Weeks Ended
4/8/95 4/9/94 4/8/95 4/9/94
---------- ---------- ---------- ----------
<S> <C> <C> <C> <C>
CASH FLOWS FROM FINANCING
ACTIVITIES:
Borrowings under
revolving lines of
credit $ 501,017 $ 682,182 $ 152,800 $ 260,142
Repayments of revolving
lines of credit (509,405) (658,267) (151,756) (248,037)
Additions to mortgage
notes payable - 2,621 - 13
Reduction of long-term
debt (5,411) (4,166) (2,208) (577)
Additions to capital
lease obligations 1,425 2,591 - 962
Repayments of capital
lease obligations (1,576) (1,263) (501) (413)
Preferred stock dividends (108) (108) (36) (36)
--------- --------- --------- ---------
Net cash provided by
(used for) financing
activities (14,058) 23,590 (1,701) 12,054
--------- --------- --------- ---------
NET DECREASE IN CASH
AND CASH EQUIVALENTS (841) (1,078) (32) (106)
CASH AND CASH EQUIVALENTS AT
BEGINNING OF PERIOD 4,376 4,394 3,567 3,422
--------- --------- --------- ---------
CASH AND CASH EQUIVALENTS AT
END OF PERIOD $ 3,535 $ 3,316 $ 3,535 $ 3,316
========= ========= ========= =========
SUPPLEMENTAL DATA:
Interest Paid $ 5,785 $ 5,421 $ 1,570 $ 1,510
========= ========= ========= ========
Income Taxes Paid $ 4,595 $ 5,601 $ 2,113 $ 2,909
========= ========= ========= ========
<FN>
The accompanying Notes to Consolidated Condensed Financial
Statements are an integral part of these statements.
</TABLE>
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RINI-REGO SUPERMARKETS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
APRIL 8, 1995
(1) Basis of Presentation:
The accompanying unaudited consolidated condensed financial
statements have been prepared in accordance with the instructions
to Form 10-Q and therefore do not include all information and
footnotes necessary for a fair presentation of financial position,
results of operations and cash flows in conformity with generally
accepted accounting principles. The results of operations for the
twelve and forty weeks ended April 8, 1995 are not necessarily
indicative of the results to be expected for the fiscal year ending
July 1, 1995. In the opinion of management, the accompanying
unaudited consolidated condensed financial statements contain all
adjustments necessary for a fair statement of the financial
position at the dates indicated and of the results of operations
for the interim periods presented.
Rini-Rego Supermarkets, Inc. ("RRS" or the "Company"),
formerly known as Fisher Foods, Inc., is a wholly owned subsidiary
of Riser Foods, Inc. ("Riser"). The accompanying financial
statements of the Company are presented on the "push down
accounting" basis, for financial reporting purposes only, with the
equity section of the accompanying balance sheet reflecting the
equity of Riser. The separate financial statements of the Company
would reflect the following stockholders' equity amounts (in
thousands):
4/8/95 7/2/94
-------- --------
Preferred Stock $ 1,811 $ 1,811
Common stock 1,403 1,403
Paid-in capital 22,714 22,714
Retained earnings 45,045 37,279
-------- --------
$70,973 $63,207
======== ========
(2) Debt:
The Company's bank credit facilities (the Facilities), which
were increased by $10.0 million during the first quarter of 1995,
provide for revolving lines of credit and letters of credit up to
an aggregate of $69.0 million and a term loan which currently has
$8.6 million outstanding. The Company increased its availability
to meet the needs of its store remodelling and expansion plans.
The Facilities are secured by substantially all of the Company's
assets. Facility fees and interest are paid monthly. Available
unused borrowing capacity under the Facilities at April 8, 1995 was
approximately $23.2 million.
Subsequent to the end of the third quarter of fiscal 1995, the
Facilities were amended, principally to extend the due date for
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borrowings under the revolving lines of credit to July 6, 1998 and
to adjust the financial covenants to accommodate the Company's
store remodelling and expansion plans. The amendment also provides
for the Company's option to borrow funds under its revolving lines
of credit and term loan at either .25% over the Bank's Prime
Interest Rate or 2.50% over LIBOR.
(3) Change in Accounting Principle - Accounting for Income Taxes:
During the first quarter of fiscal 1994, the Company adopted
Statement of Financial Accounting Standards No. 109, "Accounting
for Income Taxes" (SFAS No. 109). This statement requires that the
liability method of accounting for income taxes be used rather than
the deferred method previously used. The Company elected not to
restate prior years' financial statements. The cumulative effect
of this accounting change was to increase fiscal 1994 first quarter
earnings by $6,866,000 or $.85 per share. The cumulative effect is
principally the result of benefitting the expected utilization of
net operating loss carryforwards (NOLs) and the adjustment of
deferred tax balances to reflect changes in statutory rates.
Significant components of the Company's net deferred tax asset
as of April 8, 1995 and July 2, 1994 are as follows (in thousands):
<TABLE>
<CAPTION>
<S> <C>
DEFERRED TAX LIABILITIES:
Property, equipment
and capital leases $ (5,619)
State and local taxes other
than income (459)
---------
(6,078)
DEFERRED TAX ASSETS:
Reserve for uncollectible
accounts 1,280
Closed facilities reserves 6,123
Self insurance reserves 4,858
Employees' retirement benefits 1,058
Accruals not currently deductible 2,296
Net operating loss carryforwards 7,782
Other 974
---------
24,371
VALUATION ALLOWANCE (4,648)
---------
NET DEFERRED TAX ASSET $ 13,645
=========
</TABLE>
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The Company has gross NOLs totaling $22,890,000 which expire
as follows (in thousands):
<TABLE>
<CAPTION>
Year NOL
---- --------
<S> <C>
2000 $ 643
2001 16,859
2002 5,388
--------
$22,890
========
</TABLE>
SFAS No. 109 requires that the tax benefit of such NOLs be
recognized as an asset to the extent the Company assesses the
utilization of such NOLs to be "more likely than not". Based upon
the Company's history of prior earnings, expectation for future
earnings and tax regulations which limit the annual amount of NOLs
available for deduction, the Company does not believe the entire
amount of NOLs will be utilized before they expire. As such, a
valuation reserve of $4,648,000 has been established due to the
uncertainty of future NOL realization.
The Company's Statements of Operations for the twelve and
forty weeks ended April 8, 1995 and April 9, 1994 reflect income
tax provisions at the various statutory income tax rates to which
the Company is subject. There were no significant differences
between financial reporting and taxable income.
(4) Employee Stock Option Plan:
On February 14, 1995, the Company granted options to several
key employees to purchase 226,500 shares of Class A Common Stock
(the 1995 Options) under the Company's Stock Incentive Plan. The
exercise price of the 1995 Options is $7.25 per share of Class A
Common Stock which approximated fair market value at the date of
grant. The 1995 Options will not become exercisable until February
14, 1997 (except in certain limited circumstances) and will expire
on February 14, 2005 if not exercised. The 1995 Options are non-
qualified options for Federal Income Tax purposes.
(5) Restructuring Charge:
The Company provides for the estimated costs of closing
facilities concurrent with making the decision to close facilities.
The types of costs provided in these restructuring charges include
anticipated losses on the disposal of fixed assets, employee
severance costs and other benefits for terminated employees,
estimated withdrawal liabilities for multi-employer pension plans
and future lease payments net of estimated sublease income.
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The $12 million Restructuring Charge recorded during the third
quarter of fiscal 1994 reflected costs associated with the
Company's store consolidation plan in which the Company planned to
close 14 small, outdated Company-operated retail stores comprised
of approximately 456,000 square feet. These locations will be
replaced by seven newer, larger facilities representing
approximately 431,000 square feet. Two of these newer locations
will be operated by independently-owned retailers and the remaining
five will be new or expanded Company-operated retail stores. At
April 8, 1995, the Company has closed eight of the stores included
in the 1994 Restructuring Charge with the remaining six stores to
be closed over the next three years.
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations
Results of Operations
The Company's net sales increased 6.1% in the third quarter
ended April 8, 1995 and 5.4% year to date. The continued trend of
increased sales over the prior year is attributed to the favorable
impact of the Company's retail remodelling and merchandising
programs and an improved economy in the Company's primary market
area, northeast Ohio and western Pennsylvania. Year to date sales
were also favorably impacted by a full forty weeks of operations of
the Company's Health and Beauty Care/General Merchandise (HBC/GM)
distribution facility compared to thirty-three weeks of operations
in 1994.
Wholesale sales, excluding engineering and other service
related sales, increased 2.4% in the third quarter and 5.5% year to
date. Independent retailers supplied by the Company's distribution
facilities were also favorably impacted by stronger economic
conditions in the Company's primary market area resulting in
increased wholesale sales. Year to date wholesale sales have also
been positively impacted by the acquisition of an HBC/GM
distribution facility from its former HBC/GM supplier midway
through the first quarter of 1994, which increased the Company's
product offerings and added approximately 155 Hills Department
Stores as new customers.
The Company has continued to increase its wholesale sales
penetration to existing customers primarily in perishable product
lines while expanding its distribution territory. The Company
continuously evaluates other markets outside its primary market
area for potential distribution opportunities. Late in the second
quarter of fiscal 1995 the Company opened a sales office in the
Detroit area focusing on meat distribution.
The Company's retail remodelling and restructuring programs
have caused the consolidation of certain Company-operated retail
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stores. The following table details the number and format of
Company-operated retail stores between years:
<TABLE>
<CAPTION>
1995 1994
---- ----
<S> <C> <C>
Open at beginning of year 42 45
Opened - 1
Closed (3) (2)
---- ----
Open at end of third quarter 39 44
==== ====
Store Formats:
Rini-Rego Stop-N-Shop 34 39
Rini-Rego Marketplace 5 3
Other - 2
</TABLE>
Sales in Company-operated retail stores increased 11.2% over
last year in the third quarter and 7.8% year to date. Sales in the
37 Company-operated retail stores operating the same forty weeks in
both years, increased 11.5% in the third quarter and 8.1% year to
date. These same store sales gains, which include remodelled and
expanded locations, were the result of the Company's remodelling
program, aggressive merchandising, such as the introduction of the
Company's Preferred Shoppers Club, and an improved economic
climate. This increase represented the fifth consecutive quarter
of same store sales gains. The loss of sales associated with the
closing of five Company-operated stores between years was more than
offset by the addition of two newer, larger Company-operated retail
stores acquired in May 1994.
Company programs to remodel and remerchandise Company-operated
retail stores, which include the introduction of the Marketplace
format, continued to be successful throughout the first three
quarters of 1995. The Company's restructuring plan, where certain
non-core stores were closed and certain core stores were
remodelled, expanded or consolidated into larger retail
facilities, has also been successful, yielding continued sales
growth and improved operating leverage. Since the first quarter of
1994, the Company has constructed or converted five former Rini-
Rego Stop-N-Shop stores to its Marketplace store format.
Marketplace stores are larger, containing approximately 70,000
square feet, and meet consumer's basic grocery needs while offering
expanded product lines, with emphasis on high quality perishable
departments and a wide variety of full service, consumer-oriented
departments.
Late in the first quarter of 1995, the Association of Stop-N-
Shop Supermarkets, a northeast Ohio advertising co-operative which
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includes all of the Company-operated retail stores, introduced a
new target marketing campaign: Preferred Shoppers Club. Area
shoppers receive a Preferred Shoppers Club card which entitles them
to extra markdowns below weekly sale prices. This program is the
first of its kind in northeast Ohio and allows the Company to offer
its customers greater value. The program should ultimately enhance
the Company's ability to track and understand customer purchasing
habits and preferences. Sales in Company-operated retail stores,
especially in the general grocery category, have been favorably
impacted by the consumer's positive reception of the Preferred
Shoppers Club.
The continued trend of larger increases in same-store sales
during the third quarter is attributed to the success of Company
programs to remodel and remerchandise its stores and an improved
economic climate in northeast Ohio. These factors, especially in
its Marketplace stores, resulted in consumers increasing their
average purchase and trading-up in many commodity lines.
Gross profit, as a percentage of sales, increased from 19.0%
in 1994 to 19.9% during the third quarter of 1995 and from 19.1% in
1994 to 19.7% year to date. The shift in the Company's sales mix
from sales to independently-operated retail stores to sales in
Company-operated retail stores, continues a trend from the fourth
quarter of 1994. Sales to independently-operated retail stores
traditionally carry a lower gross profit percentage than those in
Company-operated retail stores. In the prior year, Company-
operated retail stores accounted for 49.5% of Company sales in the
third quarter and 50.6% year to date. During the third quarter and
year to date in fiscal 1995, these percentages increased to 51.9%
and 51.8%, respectively.
Selling, general and administrative (SG&A) expenses, as a
percentage of sales, increased from 17.4% in 1994 to 17.6% during
the third quarter and from 17.3% in 1994 to 17.7% year to date.
Company programs to remodel and remerchandise Company-operated
retail stores, which have proven successful at increasing sales and
gross profit percentages, also demand higher SG&A expenses
particularly occupancy and depreciation. Additionally, the
aforementioned shift to sales in Company-operated retail stores,
which demand higher SG&A expenses, especially labor costs, has also
contributed to the Company's increased SG&A percentage.
The Company recorded a $12 million dollar Restructuring Charge
in the third quarter of 1994 to account for its store consolidation
plan. This plan includes closing and consolidating certain
Company-operated retail stores, replacing them with new or
remodelled Company-operated retail stores or new or remodelled
stores to be operated by independently-owned retailers. This
charge included a $4 million non-cash charge to write down assets
to their net realizable value and a $8 million charge for future
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cash expenditures, principally occupancy costs net of expected
sublease income. The Company plans to operate approximately 35 to
40 expanded or newly remodelled Company-operated retail stores by
the end of fiscal 1998. Through the third quarter of 1995 the
Company has closed eight stores included in the 1994 Restructuring
Charge.
Interest expense decreased $26,000 in the third quarter but
increased $46,000 year to date. The third quarter decrease was
related to lower borrowing levels under the Company's bank credit
facilities and scheduled debt repayments. Lower borrowing levels
under the bank credit facilities were the result of continued
Company programs to reduce its investment in distribution
inventories and increase inventory turns. At April 8, 1995,
distribution inventory levels were 20.7% lower than that of the
previous year. Lower debt levels were partially offset by an
increase in the Company's average interest rate charged under its
bank credit facilities from 6.5% in the prior year to 8.5% during
the current year. This increase is a function of increases in the
Bank's Prime Lending Rate. Year to date, this rate increase more
than offset the Company's reduced borrowings.
Interest income increased $137,000 during the third quarter
and $372,000 year to date. The Company loans money to independent
retail operators for store remodelling and improvement projects.
These loans generally bear interest at Prime + 1.50%. The increase
in interest income is primarily the result of the increasing
interest rates noted above.
The Company accounts for income taxes in accordance with
Statement of Financial Accounting Standards No. 109 "Accounting for
Income Taxes" (SFAS No. 109). This statement requires that the
liability method of accounting for income taxes be used rather than
the deferred method previously used. The Company adopted the
provisions of SFAS No. 109 during the first quarter of 1994. The
Company elected not to restate prior year's financial statements
and recorded a one-time income item of $6.9 million to reflect the
cumulative effect. See Note (3) of the Notes to Consolidated
Condensed Financial Statements for further discussion.
The Company provided for income taxes at an effective rate of
39.5% in fiscal 1995 compared to 36.2% in fiscal 1994. Taxes were
provided at the various statutory income tax rates to which the
Company is subject. There were no significant permanent
differences between financial reporting and taxable income.
Liquidity and Sources of Capital:
The Company's primary source of capital has historically come
from internally generated funds. However, the Company's
intensified capital expenditure requirements and higher 1994
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working capital needs have increased the Company's reliance on its
bank credit facilities. Company programs to increase distribution
inventory turns, which began in the first quarter of 1995, reduced
working capital requirements and lowered borrowing levels. Greater
working capital requirements associated with the Company's HBC/GM
acquisition also increased the Company's utilization of its
revolving credit facility in the prior year.
Operating activities generated $33.6 million of cash compared
to the utilization of $6.0 million of cash in the prior year. The
success of Company programs to lower distribution inventory levels
(from $61.2 million at April 9, 1994 to $48.5 million at April 8,
1995) and to increase inventory turns has resulted in a greater
percentage of distribution inventories being financing through
trade accounts payable, without extending vendor terms, rather than
through the Company's revolving credit facilities.
Cash provided by operating activities included net income of
$7.9 million, non-cash charges for depreciation and amortization of
$13.5 million and a LIFO provision of $1.5 million. Significant
balance sheet changes included increased accounts payable of $4.2
million and accrued expenses and other liabilities of $8.0 million,
which were partially offset by increases in accounts receivable of
$1.0 million and prepaid expenses of $.5 million.
Working capital decreased $13.4 million from $43.0 million at
the end of fiscal 1994 to $29.6 million at the end of the third
quarter of 1995. The Company's ratio of current assets to current
liabilities decreased to 1.30:1 at the end of the third quarter
from 1.50:1 at the end of 1994. The Company's ratio of total
liabilities to equity improved to 2.64:1 at the end of the third
quarter from 2.98:1 at the end of 1994. These trends are
consistent with the reduction of working capital demands which
began in the first quarter of 1995 as discussed above.
Through the third quarter of 1995, the Company utilized $22.5
million of cash flow for capital expenditures, principally for its
retail store remodelling and expansion program ($18.5 million),
improved distribution facilities and equipment ($2.1 million) and
upgrades of its data processing systems and corporate facilities
($1.9 million). This level of capital expenditures was slightly
higher than the same period last year. The capital expenditures
level for 1995 is expected to exceed that of 1994. At the end of
the third quarter, the Company had completed four major retail
store remodelling projects with one additional retail project under
construction. This project will be completed after year end.
The Company anticipates it will maintain its current level of
capital expenditures ($25-35 million) over the next four fiscal
years until it has completed the remodelling or expansion of its
core stores. As part of the Company's restructuring plan, the
company has continued to expand the average square footage of its
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Sequential Page 16 of 18
core stores, adding approximately 27,500 square feet of new retail
space during the first three quarters of 1995.
The Company is also required, pursuant to the terms of its
lease, to purchase its Aurora Road warehouse facility and Cash-N-
Carry branch in July 1995 for $6 million. The Company believes
that cash flow from operations and the unused portion of the bank
credit facilities ($23.2 million at the end of the third quarter)
will adequately fund planned capital expenditures, normal ongoing
business activities and scheduled debt principal repayments.
The Company's labor contract for its principle distribution
facility expired April 1, 1994 and the Company continues to bargain
in good faith with the union's negotiating committee. The Company
does not anticipate any business disruptions as a result of these
negotiations and hopes to resolve this matter as quickly as
practical.
PAGE
<PAGE>
Sequential Page 17 of 18
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
10.55 Amendment No. 2 to Amended and Restated
Guaranty Agreement by Riser dated October 6,
1994
10.56 Amendment No. 2 to Amended and Restated Credit
Agreement by and among Rini-Rego Supermarkets,
Inc. ("Rini-Rego"), Society National Bank
("Society") and the banks dated October 6, 1994
10.57 Amendment No. 1 to Amended and Restated Credit
Agreement by and among American Seaway Foods,
Inc. ("Seaway"), Society and the banks dated
October 6, 1994
10.58 Amendment No. 3 to Amended and Restated
Guaranty Agreement by Riser dated April 28,
1995
10.59 Amendment No. 3 to Amended and Restated Credit
Agreement by and among Rini-Rego, Society and
the banks dated April 28, 1995
10.60 Amendment No. 2 to Amended and Restated Credit
Agreement by and among Seaway, Society and the
banks dated April 28, 1995
(b) Reports on Form 8-K
None
PAGE
<PAGE>
Sequential Page 18 of 18
SIGNATURES
Pursuant to the requirements of section 12, 13 or 15(d) 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.
RINI-REGO SUPERMARKETS, INC.
(Registrant)
/s/ Charles A. Rini, Sr.
May 17, 1995 By: Charles A. Rini, Sr.
President and Director
/s/ Ronald W. Ocasek
May 17, 1995 By: Ronald W. Ocasek
Chief Financial Officer and
Treasurer, (Principal
Accounting Officer)
PAGE
<PAGE>
<PAGE>
EXHIBIT 10.55
PAGE
<PAGE>
AMENDMENT NO. 2
TO
AMENDED AND RESTATED
GUARANTY AGREEMENT
This Amendment No. 2 to Amended and Restated Guaranty
Agreement (this "Amendment"), made as of the day of
1995, among RISER FOODS, INC., a Delaware corporation (herein the
"Guarantor"), the Banks (as hereinafter defined), and SOCIETY
NATIONAL BANK, as agent for the Banks (herein the "Agent").
WITNESSETH:
WHEREAS, the Guarantor has executed and delivered to the
financial institutions which are a party to the Credit Agreements
(as defined below) (the "Banks"), that certain Amended and Restated
Guaranty Agreement, dated as of May 27, 1993 (as amended pursuant
to Amendment No. 1 to Amended and Restated Guaranty Agreement,
dated as of May 16, 1994, the "Guaranty Agreement"), pursuant to
which the Guarantor unconditionally guaranteed the payment of all
of the Obligations (as defined in the Guaranty Agreement); and
WHEREAS, Rini-Rego Supermarkets, Inc. (formerly known as
Fisher Foods, Inc.) an Ohio corporation ("Rini-Rego"), the Banks
and the Agent have entered into that certain Amended and Restated
Credit Agreement, dated as of May 27, 1993, as amended by that
certain Amendment No. 1 to Amended and Restated Credit Agreement,
dated as of the date hereof (the "Rini-Rego Agreement"), pursuant
to which the Banks have made certain financial accommodations
available to Rini-Rego; and
WHEREAS, American Seaway Foods, Inc., an Ohio corporation
("American"), the Banks and the Agent have entered into that
certain Amended and Restated Credit Agreement, dated as of May 27,
1993, as amended by that certain Amendment No. 1 to Amended and
Restated Credit Agreement, dated as of the date hereof (the
"American Agreement" and, together with the Rini-Rego Agreement,
the "Credit Agreements");
WHEREAS, the Banks which are signatories hereto
constitute all of the Banks for the purpose of amending the
Guaranty Agreement pursuant to Section 8.22 of the American
Agreement and Section 8.21 of the Rini-Rego Agreement;
WHEREAS, the Guarantor, the Banks and the Agent desire
further to amend the Guaranty Agreement as set forth herein;
NOW, THEREFORE, in consideration of the mutual promises
and agreements contained herein and other good and valuable
consideration, the receipt and adequacy of which are hereby
acknowledged, the Guarantor, the Banks and the Agent do hereby
agree as follows:
-1-
PAGE
<PAGE>
SECTION 1. DEFINED TERMS.
Each defined term used herein and not otherwise defined
herein shall have the meaning ascribed to such term in the Guaranty
Agreement.
SECTION 2. AMENDMENTS TO THE GUARANTY AGREEMENT.
The Guarantor, the Banks and the Agent hereby agree that
the following Sections of the Guaranty Agreement shall be amended,
effective as of the date hereof and subject to the terms and
conditions hereof, as follows:
2.1 Amendment to Section 7(l). Section 7(l) shall be
amended to delete the covenant of Consolidated Leverage in its
entirety and to substitute in lieu thereof the following:
(1) Consolidated Leverage. The Guarantor shall not
suffer or permit, as at the end of any Fiscal Quarter,
the ratio of Consolidated Total Liabilities to
Consolidated Tangible Net Worth at such date to exceed
the maximum ratios permitted for such Fiscal Quarter as
set forth below:
<TABLE>
<CAPTION> Maximum
Fiscal Quarter Ending Leverage Ratio
<S> <C>
During Fiscal Year 1993 4.0 to 1.0
During Fiscal Year 1994 4.0 to 1.0
October 22, 1994 4.0 to 1.0
January 14, 1995 3.75 to 1.0
April 8, 1995 3.75 to 1.0
July 1, 1995 3.75 to 1.0
During Fiscal Year 1996 3.0 to 1.0
During Fiscal Year 1997 2.5 to 1.0
During Fiscal Year 1998 2.5 to 1.0
</TABLE>
2.2 Deletion of Section 7(o). Section 7(o) shall be
deleted in its entirety.
2.3 Amendment to Section 7(r). Section 7)r) shall be
amended to delete the covenant of Indebtedness in its entirety to
substitute in lieu thereof the following:
(r) Indebtedness. The Guarantor shall not create or
suffer to exist any Indebtedness except (i) as permitted by
the Agreements, (ii) as set forth on Schedule 5.02(b) to the
Rini-Rego Agreement, (iii) ordinary course trade payables, and
(iv) that certain Guaranty of Retail Space Lease, dated as of
July 22, 1994, in favor of The Coral Company.
-2-
PAGE
<PAGE>
2.4 Amendment to Section 7((t). Section 7(t) shall be
amended to delete the covenant of Consolidated Capital Expenditures
in its entirety and to substitute in lieu thereof the following:
(t) Consolidated Capital Expenditures. The Guarantor
shall not make, for any Fiscal Year, any Consolidated Capital
Expenditures that would cause the Consolidated Capital
Expenditures to exceed the maximum amount of Consolidated
Capital Expenditures allowed to have been made during any
Fiscal Year as set forth below:
<TABLE>
<CAPTION>
Consolidated
Capital Expenditures
Fiscal Year Maximum Amount
<S> <C>
1993 $26,667,000
1994 $26,143,000
1995 $32,500,000
1996 $14,200,000
1997 $10,000,000
1998 $10,000,000
</TABLE>
provided, however, that, in any Fiscal Year, the Guarantor
may, in addition to the Consolidated Capital Expenditures
permitted for such Fiscal Year also incur additional
Consolidated Capital Expenditures equal to the Consolidated
Capital Expenditure Excess Amount from the immediately
preceding Fiscal Year. For purposes of calculating the
Guarantor's compliance with this Section 7(t), the amount of
Consolidated Capital Expenditures during any Fiscal Year shall
be applied first to the maximum amount set forth above and
then to any Consolidated Capital Expenditures Excess Amount
available from the immediately preceding Fiscal Year;
provided, further, that the Consolidated Capital Expenditures
Maximum Amount for Fiscal Year 1995 shall exclude any and all
transactions with respect to building No. 5 and the cash-n-
carry building.
2.5 Amendment to Section 14. Section 14 shall be amended
to delete the definition of "Consolidated Net Income" in its
entirety and to substitute in lieu thereof the following:
"Consolidated Net Income" means, for any period, the
aggregate net income of the Guarantor and its
Subsidiaries for such period (after taxes and after
extraordinary items, but without giving effect to any
gain from any re-appraisal or write-up of any asset after
December 31, 1992), as determined on a consolidated basis
in accordance with generally accepted accounting
principles; provided, however, that, with respect to the
Fiscal Quarter of the Guarantor ending October 23, 1993,
-3-
<PAGE>
and thereafter, the "Consolidated Net Income" of the
Guarantor shall be calculated giving effect to the
Guarantor's adoption of Statement of Financial Accounting
Standard No. 109.
2.6 Amendment to Schedule I. Schedule I to the Guaranty
shall be amended to delete the Net Operating Cash Flow requirements
contained thereon and the Schedule I attached hereto substituted in
its entirety in lieu thereof.
SECTION E. REPRESENTATIONS AND WARRANTIES
The Guarantor hereby represents and warrants to the Banks
and the Agent as follows:
3.1 The Amendment. This Amendment has been duly and
validly executed by an authorized executive officer of the
Guarantor and constitutes the legal, valid and binding obligation
of the Guarantor enforceable against the Guarantor in accordance
with its terms.
3.2 Guaranty Agreement. The Guaranty Agreement, as
amended by this Amendment, remains in full force and effect and
remains the valid and binding obligation of the Guarantor
enforceable against the Guarantor in accordance with its terms.
The Guarantor hereby ratifies and confirms the Guaranty Agreement,
as amended by this Amendment.
3.3 Nonwaiver. The execution, delivery, performance and
effectiveness of this Amendment shall not operate nor be deemed to
be nor construed as a waiver (i) of any right, power or remedy of
the Banks or the Agent under the Guaranty Agreement, nor (ii) of
any term, provision, representation, warranty or covenant contained
in the Guaranty Agreement or any other documentation executed in
connection therewith. Further, none of the provisions of this
Amendment shall constitute, be deemed to be or construed as, a
waiver of any Default of Event of Default under the Guaranty
Agreement as amended by this Agreement.
3.4 Reference to and Effect on the Guaranty Agreement.
Upon the effectiveness of this Amendment, each reference in the
Guaranty Agreement to "this Agreement", "hereunder", "hereof",
"herein", or words of like import shall mean and be a reference to
the Guaranty Agreement, as amended hereby and each reference to the
Guaranty Agreement in any other document, instrument or agreement
executed and/or delivered in connection with the Guaranty Agreement
shall mean and be a reference to the Guaranty Agreement, as amended
by this Amendment.
-4-
PAGE
<PAGE>
SECTION 4. CONDITIONS PRECEDENT TO EFFECTIVENESS
OF THIS AMENDMENT NO. 2.
In addition to all of the other conditions and agreements
set forth herein, the effectiveness of this Amendment is subject to
the following conditions precedent:
4.1 The Amendment. The Banks and the Agent shall have
received this Amendment No. 2 to Amended and Restated Guaranty
Agreement, executed and delivered by a duly authorized officer of
the Guarantor.
4.2 Amendment No. 2 to Rini-Rego Agreement. The Banks
and the Agent shall have received an Amendment No. 2 to Amended and
Restated Credit Agreement from Rini-Rego, executed and delivered by
a duly authorized officer of Rini-Rego, and all of the respective
conditions precedent to such Amendment shall have been satisfied.
4.3 Amendment No. 1 to American Agreement. The Banks
and the Agent shall have received an Amendment No. 1 to Amended and
Restated Credit Agreement from American, executed and delivered by
a duly authorized officer of American, and all of the respective
conditions precedent to such Amendment shall have been satisfied.
4.4 Acknowledgement of Borrowers. The Banks and the
Agent shall have received the Acknowledgement of Borrowers attached
to this Amendment, executed and delivered by a duly authorized
officer of each of Rini-Rego and American.
4.5 Guarantor's Certificate. The Banks and the Agent
shall have received a certificate, in form and substance
satisfactory to the Agent, executed for and on behalf of the
Guarantor by the Chief Executive Officer and the Secretary of the
Guarantor and dated as of the date of this Amendment, certifying
(i) the Director's Resolutions of the Guarantor, authorizing this
Amendment, and each document or other instrument executed in
connection with the Amendment, (ii) the names and signatures of the
officers of the Guarantor, and (iii) compliance by the Guarantor
with all representations, warranties, covenants and conditions
under the Guaranty, as amended by this Amendment.
4.6 Other Documents. The Banks and the Agent shall have
received each additional document, instrument or piece of
information reasonably requested by the Agent, including, without
limitation, any financing statements as may be necessary to
continue the perfection of the security interests created by the
Security Agreements.
SECTION 5. MISCELLANEOUS.
5.1 Governing Law. This Amendment shall be governed by
and construed in accordance with the laws of the State of Ohio.
-5-
PAGE
<PAGE>
5.2 Severability. In the event any provision of this
Amendment should be invalid, the validity of the other provisions
hereof and of the Guaranty Agreement shall not be affected thereby.
5.3 Counterparts. This Amendment may be executed in one
or more counterparts, each of which, when taken together, shall
constitute but one and the same agreement.
IN WITNESS WHEREOF, the Guarantor has caused this
Amendment No. 2 to Amended and Restated Guaranty Agreement to be
duly executed and delivered by its duly authorized officer as of
the date first above written.
RISER FOODS, INC.
By:
Title:
ACCEPTED AND AGREED as of
this day of , 1995
SOCIETY NATIONAL BANK, as a PNC BANK, NATIONAL ASSOCIATION
Bank and as Agent as a Bank
By: By:
Title: Title:
NATIONAL CITY BANK, STAR BANK, N.A., as a Bank
as a Bank
By: By:
Title: Title:
NBD BANK, N.A.,
as a Bank
By:
Title:
-6-
PAGE
<PAGE>
ACKNOWLEDGEMENT OF BORROWERS
Each of the undersigned, RINI-REGO SUPERMARKETS, INC.
(formerly known as Fisher Foods, Inc.) and AMERICAN SEAWAY FOODS,
INC. (formerly known as Heritage Wholesalers, Inc.), each of which
being a borrower of certain sums from the Banks under the
Agreements (as defined in the Guaranty Agreement), hereby
acknowledges and agrees to the terms of the foregoing Amendment No.
2 to Amended and Restated Guaranty Agreement. Each of the
undersigned represents and warrants to the Banks and the Agent that
the respective Agreements as amended), executed and delivered by
each of the undersigned, each dated as of , 1995,
remain the valid and binding obligations of each of the
undersigned, respectively, enforceable against it in accordance
with their terms.
RINI-REGO SUPERMARKETS, INC. (formerly
known as Fisher Foods, Inc.)
By:
Title:
AMERICAN SEAWAY FOODS, INC. (formerly
known as Heritage Wholesalers, Inc.)
By:
Title:
Executed: , 1995
-7-
<PAGE>
<PAGE>
<TABLE>
<CAPTION>
SCHEDULE I
TO
GUARANTY AGREEMENT
FISCAL QUARTER MINIMUM REQUIRED
ENDING AMOUNT OF NET OPERATING
CASH FLOW
<S> <C>
7/3/93 $17,391,000
10/23/93 $ 6,845,000
1/15/94 $10,980,000
4/9/94 $15,943,000
7/2/94 $18,542,000
10/22/94 $ 6,500,000
1/14/95 $11,312,000
4/8/95 $16,291,000
7/1/95 $23,632,000
10/21/95 $ 7,450,000
1/13/96 $12,035,000
4/6/96 $17,281,000
6/29/96 $25,015,000
10/19/96 $ 7,715,000
1/11/97 $12,496,000
4/5/97 $17,917,000
6/28/97 $25,886,000
10/18/98 $ 7,715,000
1/10/98 $12,496,000
4/4/98 $17,917,000
180\22687EAB.120
-8-
PAGE
<PAGE>
-8-
PAGE
<PAGE>
</TABLE>
<PAGE>
EXHIBIT 10.56
PAGE
<PAGE>
AMENDMENT NO. 2
TO
AMENDED AND RESTATED
CREDIT AGREEMENT
This Amendment No. 2 to Amended and Restated Credit
Agreement (this "Amendment"), made as of the day of ,
1995, between RINI-REGO SUPERMARKETS, INC. (formerly known as
Fisher Foods, Inc.), and Ohio corporation (herein the "Borrower"),
the Banks (as hereinafter defined) and SOCIETY NATIONAL BANK, as
agent for the Banks (in such capacity, the "Agent"),
WITNESSETH:
WHEREAS, the Borrower has been extended certain financial
accommodations pursuant to that certain Amended and Restated Credit
Agreement, dated as of May 27, 1993 (as amended pursuant to
Amendment No. 1 to Amended and Restated Credit Agreement, dated as
of May 16, 1994, the "Credit Agreement"), among the Borrower, the
financial institutions which are a party thereto (the "Banks") and
the Agent; and
WHEREAS, the Borrower, the Banks and the Agent desire to
amend the Credit Agreement as set forth herein to increase the
aggregate Total Commitments of the Banks to Sixteen Million Dollars
($16,000,000);
WHEREAS, the Banks which are the signatories hereto
constitute all of the Banks for the purposes of amending the Credit
Agreement pursuant to Section 8.21 thereof;
NOW THEREFORE, in consideration of the mutual promises
and agreements contained herein and other good and valuable
consideration, the receipt and adequacy of which are hereby
acknowledged, the Borrower, the Banks and the Agent do hereby agree
as follows:
SECTION 1. DEFINED TERMS.
Each defined term used herein and not otherwise defined
herein shall have the meaning ascribed to such term in the Credit
Agreement.
SECTION 2. AMENDMENTS TO THE CREDIT AGREEMENT.
The Borrower, the Banks and the Agent hereby agree that
the Credit Agreement shall be amended, effective as of the date
hereof and subject to the terms and conditions hereof, as follows:
2.1 Amendment to Section 2.01. The introductory
paragraph of Section 2.01 shall be amended in its entirety and the
following substituted in lieu thereof to read as follows:
-1-
<PAGE>
SECTION 2.01. The Loans and the Letters of Credit.
Each Bank severally agrees, up to the amount of its
Revolving Credit Commitment, from time to time, to make
certain financial accommodations available to the
Borrower, up to the amount of such Bank's Total
Commitment, in the aggregate principal amount of Sixteen
Million Dollars ($16,000,000). The credit advances shall
be comprised of advances on a revolving credit basis in
the initial aggregate principal amount not to exceed
Sixteen Million Dollars ($16,000,000), as such amount may
be reduced from time to time in accordance with the terms
of this Agreement, of which up to One Million Dollars
($1,000,000) may be made available for letters of credit.
2.2 Amendment to Section 2.06(b)(ii)(A). Section
2.06(b)(ii)(A) shall be deleted in its entirety and the following
shall be substituted in lieu thereof:
(A) For the period commencing on October 1, 1994 and ending
on the earlier of the occurrence of an Event of Default
or September 30, 1995, the Loans shall bear interest as
follows: if the Cumulative Consolidated Net Operating
Cash Flow as of the 1994 Determination Date shall be
greater than Forty-Three Million Two Hundred Twenty-Eight
Thousand Dollars ($43,228,000), at a rate per annum equal
to the Prime Rate plus one quarter of one percent (1/4%).
2.3 Amendment to Section 2.06(b)(ii)(B). Section
2.06(b)(ii)(B) shall be deleted in its entirety and the following
shall be substituted in lieu thereof:
(B) For the period commencing on October 1, 1995 and ending
upon the occurrence of an Event of Default, the Loans
shall bear interest as follows: (a) if the Cumulative
Consolidated Net Operating Cash Flow as of the 1995
Determination Date shall be greater than Seventy-Four
Million Six Hundred Fifty-Nine Thousand Dollars
($74,659,000) but less than or equal to Ninety-Six
Million Seven Hundred Eighty-Seven Thousand Dollars
($96,787,000), at a rate per annum equal to the Prime
Rate plus one quarter of one percent (1/4%) or (b) if the
Cumulative Consolidated Net Operating Cash Flow as of the
1995 Determination Date shall be greater than Ninety-Six
Million Seven Hundred Eighty-Seven Thousand Dollars
($96,787,000), at a rate per annum equal to the Prime
Rate.
2.4 Amendment to Section 5.03(i). Section 5.03(i) shall
be deleted in its entirety and the following shall be substituted
in lieu thereof:
-2-
<PAGE>
<PAGE>
(i) as soon as available and in any event within thirty
(30) days after the end of each Fiscal Period (including the
last Fiscal Period of any Fiscal Year) statements of income in
form and substance as the Agent may reasonably request, all
prepared in accordance with generally accepted accounting
principles.
2.5 Amendment to Section 8.25. Section 8.25 shall be
deleted in its entirety and the following shall be substituted in
lieu thereof:
SECTION 8.25 Commitments. The Revolving Credit
Commitment and the Total Commitment of each Bank shall be as
set forth below:
<TABLE>
<CAPTION>
BANK REVOLVLING BANK'S
CREDIT TOTAL
COMMITMENT COMMITMENT
<S> <C> <C>
Society National $6,400,000 $6,400,000
Bank
National City $3,728,000 $3,728,000
Bank
PNC Bank, $2,672,000 $2,672,000
National
Association
NBD Bank, N.A. $1,600,000 $1,600,000
Star Bank, N.A. $1,600,000 $1,600,000
Total of
Commitments $16,000,000 $16,000,000
</TABLE>
SECTION 3. REPRESENTATIONS AND WARRANTIES.
The Borrower hereby represents and warrants to the Banks
and the Agent as follows:
3.1 The Amendment. This Amendment has been duly and
validly executed by an authorized executive officer of the Borrower
and constitutes the legal, valid and binding obligation of the
Borrower enforceable against the Borrower in accordance with its
terms.
-3-
PAGE
<PAGE>
3.2 Credit Agreement. The Credit Agreement, as amended
by this Amendment, remains in full force and effect and remains the
valid and binding obligation of the Borrower enforceable against
the Borrower in accordance with its terms. The Borrower hereby
ratifies and confirms the Credit Agreement, as amended by this
Amendment.
3.3 Nonwaiver. The execution, delivery, performance and
effectiveness of this Amendment shall not operate nor be deemed to
be nor construed as a waiver (i) of any right, power or remedy of
the Banks or the Agent under the Credit Agreement, nor (ii) of any
term, provision, representation, warranty or covenant contained in
the Credit Agreement or any other documentation executed in
connection therewith. Further, none of the provisions of this
Amendment shall constitute, be deemed to be or construed as, a
waiver of any Default or Event of Default under the Credit
Agreement as amended by this Amendment.
3.4 Reference to and Effect on the Credit Agreement.
Upon the Effectiveness of this Amendment, each reference in the
Credit Agreement to "this Agreement", "hereunder", "hereof",
"herein", or words of like import shall mean and be a reference to
the Credit Agreement, as amended hereby and each reference to the
Credit Agreement in any other document, instrument or agreement
executed and/or delivered in connection with the Credit Agreement
shall mean and be a reference to the Credit Agreement, as amended
hereby.
SECTION 4. CONDITIONS PRECEDENT TO EFFECTIVENESS
OF THIS AMENDMENT NO. 2.
In addition to all of the other conditions and agreements
set forth herein, the effectiveness of this Amendment is subject to
the following conditions precedent:
4.1 The Amendment. The Banks and the Agent shall have
received this Amendment No. 2 to Amended and Restated Credit
Agreement, executed and delivered by a duly authorized officer of
the Borrower.
4.2 Amendment No. 2 to Riser Guaranty. The Banks and
the Agent shall have received Amendment No. 2 to Amended and
Restated Guaranty Agreement, executed and delivered by a duly
authorized officer of Riser Foods, Inc., and all of the conditions
precedent to such Amendment shall have been satisfied.
4.3 Acknowledgement of Guarantors. The Banks and the
Agent shall have received the Acknowledgement of Guarantors
attached to this Amendment, executed and delivered by a duly
authorized officer of each of the Guarantors of the indebtedness of
the Borrower to the Banks and the Agent.
-4-
PAGE
<PAGE>
4.4 Borrower's Certificate. The Banks and the Agent
shall have received a certificate, in form and substance
satisfactory to the Agent, executed for an on behalf of the
Borrower by the Chief Executive Officer and the Secretary of the
Borrower and dated as of the date of this Amendment, certifying (i)
the Director's Resolutions of the Borrower, authorizing this
Amendment, and each document or other instrument executed in
connection with the Amendment, (ii) the names and signatures of the
officers of the Borrower, and (iii) compliance by the Borrower with
all representations, warranties, covenants and conditions under the
Credit Agreement, as amended by this Amendment.
4.5 Other Documents. The Banks and the Agent shall have
received each additional document, instrument or piece of
information reasonably requested by the Agent, including, without
limitation, any financing statements as may be necessary to
continue the perfection of the security interests created by the
Security Agreements.
SECTION 5. MISCELLANEOUS.
5.1 Governing Law. This Amendment shall be governed by
and construed in accordance with the laws of the State of Ohio.
5.2 Severability. In the event any provision of this
Amendment should be invalid, the validity of the other provisions
hereof and of the Credit Agreement shall not be affected thereby.
5.3 Counterparts. This Amendment may be executed in one
or more counterparts, each of which, when taken together, shall
constitute but one and the same agreement.
-5-
PAGE
<PAGE>
IN WITNESS WHEREOF, the Borrower has caused this
Amendment No. 2 to Amended and Restated Credit Agreement to be duly
executed and delivered by its duly authorized officer as of the
date first above written.
RINI-REGO SUPERMARKETS, INC.
(formerly known as Fisher Foods,
Inc.)
By:
Title:
ACCEPTED AND AGREED as of
this day of , 1995
SOCIETY NATIONAL BANK, PNC BANK, NATIONAL ASSOCIATION,
as a Bank and as Agent as a Bank
By: By:
Title: Title:
NATIONAL CITY BANK, STAR BANK, N.A. as a Bank
as a Bank
by: By:
Title: Title:
NBD BANK, N.A., as a Bank
By:
Title:
-6-
PAGE
<PAGE>
ACKNOWLEDGEMENT OF GUARANTORS
Each of the undersigned, RISER FOODS, INC., SEAWAY FOOD
SERVICE, INC. (formerly known as American Seaway Foods, Inc.)
FISHER PROPERTIES, INC., and AMERICAN SEAWAY FOODS, INC. (formerly
known as Heritage Wholesalers, Inc.), each of which being a
guarantor of indebtedness of the Borrower to the Banks and the
Agent, hereby acknowledges and agrees to the terms of the foregoing
Amendment No. 2 to Amended and Restated Credit Agreement. Each of
the undersigned represents and warrants to the Banks and the Agent
that the respective Amended and Restated Guaranty Agreements (as
amended), executed and delivered by each of the undersigned, each
dated as of May 27, 1993, remain the valid and binding obligations
of each of the undersigned, respectively, enforceable against it in
accordance with their terms.
RISER FOODS, INC.
By:
Title:
SEAWAY FOOD SERVICE, INC. (formerly
known as American Seaway Foods, Inc.)
By:
Title:
AMERICAN SEAWAY FOODS, INC. (formerly
known as Heritage Wholesalers, Inc.)
By:
Title:
FISHER PROPERTIES, INC.
By:
Title:
Executed: , 1995
-7-
PAGE
<PAGE>
<PAGE>
EXHIBIT 10.57
PAGE
<PAGE>
AMENDMENT NO. 1
TO
AMENDED AND RESTATED
CREDIT AGREEMENT
This Amendment No. 1 to Amended and Restated Credit
Agreement (this "Amendment"), made as of the ____ day of October,
1994, between AMERICAN SEAWAY FOODS, INC., an Ohio corporation
(herein the "Borrower"), the Banks (as hereinafter defined) and
SOCIETY NATIONAL BANK, as agent for the Banks (in such capacity,
the "Agent"),
WITNESSETH:
WHEREAS, the Borrower has been extended certain financial
accommodations pursuant to that certain Amended and Restated Credit
Agreement, dated as of May 27, 1993 (the "Credit Agreement"), among
the Borrower, the financial institutions which are a party thereto
(the "Banks") and the Agent; and
WHEREAS, the Borrower, the Banks and the Agent desire to
amend the Credit Agreement as set forth herein to increase the
aggregate Revolving Credit Commitments of the Banks to Fifty-Five
Million Dollars ($55,000,000);
WHEREAS, the Banks which are the signatories hereto
constitute all of the Banks for the purposes of amending the Credit
Agreement pursuant to Section 8.22 thereof;
NOW, THEREFORE, in consideration of the mutual promises
and agreements contained herein and other good and valuable
consideration, the receipt and adequacy of which are hereby
acknowledged, the Borrower, the Banks and the Agent do hereby agree
as follows:
SECTION 1. DEFINED TERMS.
Each defined term used herein and not otherwise defined
herein shall have the meaning ascribed to such term in the Credit
Agreement.
SECTION 2. AMENDMENTS TO THE CREDIT AGREEMENT.
The Borrower, the Banks and the Agent hereby agree that
the Credit Agreement shall be amended, effective as of the date
hereof and subject to the terms and conditions hereof, as follows:
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<PAGE>
2.1 Amendment to Section 1.01. Section 1.01 shall be
amended to delete the definition of "Special Seaway Availability"
in its entirety and to substitute in lieu thereof the following:
"Special Seaway Availability" shall mean the lesser of
(a) 65% of the value of the aggregate amount of Inventory of
Seaway to the extent such Inventory would be considered
Eligible Inventory as provided herein if such Inventory were
owned by the Borrower plus 85% of the value of the Receivables
of Seaway to the extent such Receivables would be considered
Eligible Receivables as provided herein if such Receivables
were owned by the Borrower or (b) Ten Million Dollars
($10,000,000).
2.2 Amendment to Section 2.01 Preamble. The
introductory paragraph of Section 2.01 shall be amended in its
entirety and the following substituted in lieu thereof to read as
follows:
SECTION 2.01. The Loans and the Letters of Credit.
Each Bank severally agrees, up to the amount of its Total
Commitment from time to time, to make certain financial
accommodations available to the Borrower, in the
aggregate amount of Sixty-Seven Million Dollars
($67,000,000). The credit advances shall be comprised of
(i) advances on a revolving credit basis in the initial
aggregate principal amount not to exceed Fifty-Five
Million Dollars ($55,000,000), as such amount shall be
reduced in accordance with the terms of this Agreement,
of which up to Four Million Dollars ($4,000,000) may be
made available for letters of credit and (ii) advances on
a term loan basis in the aggregate principal amount not
to exceed Twelve Million Dollars ($12,000,000), all as
subject to the foregoing and to the further terms and
conditions of this Agreement.
2.3 Amendment to Section 2.01(e). Section 2.01(e) shall
be amended in its entirety and the following substituted in lieu
thereof to read as follows:
(e) Automatic Reductions in Revolving Credit
Commitment. Commencing December 1, 1994, and on each
December 1 thereafter until the Termination Date, the
aggregate Revolving Credit Commitment of the Banks shall
be immediately and permanently reduced by Two Million
Dollars ($2,000,000). Concurrently with each reduction
in the aggregate Revolving Credit Commitments of the
Banks the Borrower shall prepay an amount equal to the
excess, if any, of the sum of the aggregate Revolving
Credit Advances then outstanding plus the Letter of
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<PAGE>
Credit Face Amount of all outstanding Letters of Credit over
the aggregate Revolving Credit Commitment of the Banks as so
reduced.
2.4 Amendment to Section 2.06(b)(ii)(A). Section
2.06(b)(ii)(A) shall be deleted in its entirety and the following
shall be substituted in lieu thereof:
(A) For the period commencing on October 1, 1994
and ending on the earlier of the occurrence of
an Event of Default or September 30, 1995, the
Loans shall bear interest as follows: if the
Cumulative Consolidated Net Operating Cash
Flow as of the 1994 Determination Date shall
be greater than Forty-Three Million Two
Hundred Twenty-Eight Thousand Dollars
($43,228,000), at a rate per annum equal to
the Prime Rate plus one quarter of one percent
(1/4%).
2.5 Amendment to Section 2.06(b)(ii)(B). Section
2.06(b)(ii)(B) shall be deleted in its entirety and the following
shall be substituted in lieu thereof:
(B) For the period commencing on October 1, 1995
and ending upon the occurrence of an Event of
Default, the Loans shall bear interest as
follows: (a) if the Cumulative Consolidated
Net Operating Cash Flow as of the 1995
Determination Date shall be greater than
Seventy-Four Million Six Hundred Fifty-Nine
Thousand Dollars ($74,659,000) but less than
or equal to Ninety-Six Million Seven Hundred
Eighty-Seven Thousand Dollars ($96,787,000),
at a rate per annum equal to the Prime Rate
plus one quarter of one percent (1/4%) or (b)
if the Cumulative Consolidated Net Operating
Cash Flow as of the 1995 Determination Date
shall be greater than Ninety-Six Million Seven
Hundred Eighty-Seven Thousand Dollars
($96,787,000), at a rate per annum equal to
the Prime Rate.
2.6 Amendment to Section 5.03(i). Section 5.03(i) shall
be deleted in its entirety and the following shall be substituted
in lieu thereof:
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<PAGE>
<PAGE>
(i) as soon as available and in any event within thirty
(30) days after the end of each Fiscal Period (including the
last Fiscal Period of any Fiscal Year) statements of income in
form and substance as the Agent may reasonably request, all
prepared in accordance with generally accepted accounting
principles.
2.7 Amendment to Section 8.26. Section 8.26 shall be
deleted in its entirety and the following shall be substituted in
lieu thereof:
SECTION 8.26. Commitments. The Revolving Credit
Commitment and the Term Loan Commitment of each Bank
shall be as set forth below:
<TABLE>
<CAPTION>
BANK TERM REVOLVLING BANK'S
LOAN CREDIT TOTAL
COMMITMENT COMMITMENT COMMITMENT
<S> <C> <C> <C>
Society National $4,800,000 $22,000,000 $26,000,000
Bank
National City $2,800,000 $12,815,000 $15,615,000
Bank
PNC Bank, $2,000,000 $9,185,000 $11,185,000
National
Association
NBD Bank, N.A. $1,200,000 $5,500,000 $ 6,700,000
Star Bank, N.A. $1,200,000 $5,500,000 $ 6,700,000
Total of
Commitments $12,000,000 $55,000,000 $67,000,000
</TABLE>
SECTION 3. REPRESENTATIONS AND WARRANTIES.
The Borrower hereby represents and warrants to the Banks
and the Agent as follows:
3.1 The Amendment. This Amendment has been duly and
validly executed by an authorized executive officer of the Borrower
and constitutes the legal, valid and binding obligation of the Bor-
rower enforceable against the Borrower in accordance with its
terms.
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PAGE
<PAGE>
3.2 Credit Agreement. The Credit Agreement, as amended
by this Amendment, remains in full force and effect and remains the
valid and binding obligation of the Borrower enforceable against
the Borrower in accordance with its terms. The Borrower hereby
ratifies and confirms the Credit Agreement, as amended by this
Amendment.
3.3 Nonwaiver. The execution, delivery, performance and
effectiveness of this Amendment shall not operate nor be deemed to
be nor construed as a waiver (i) of any right, power or remedy of
the Banks or the Agent under the Credit Agreement, nor (ii) of any
term, provision, representation, warranty or covenant contained in
the Credit Agreement or any other documentation executed in
connection therewith. Further, none of the provisions of this
Amendment shall constitute, be deemed to be or construed as, a
waiver of any Default or Event of Default under the Credit
Agreement as amended by this Amendment.
3.4 Reference to and Effect on the Credit Agreement.
Upon the effectiveness of this Amendment, each reference in the
Credit Agreement to "this Agreement", "hereunder", "hereof",
"herein", or words of like import shall mean and be a reference to
the Credit Agreement, as amended hereby and each reference to the
Credit Agreement in any other document, instrument or agreement
executed and/or delivered in connection with the Credit Agreement
shall mean and be a reference to the Credit Agreement, as amended
hereby.
SECTION 4. CONDITIONS PRECEDENT TO EFFECTIVENESS
OF THIS AMENDMENT NO. 1.
In addition to all of the other conditions and agreements
set forth herein, the effectiveness of this Amendment is subject to
the following conditions precedent:
4.1 The Amendment. The Banks and the Agent shall have
received this Amendment No. 1 to Amended and Restated Credit
Agreement, executed and delivered by a duly authorized officer of
the Borrower.
4.2 Amendment No. 2 to Riser Guaranty. The Banks and
the Agent shall have received Amendment No. 2 to Amended and
Restated Guaranty Agreement, executed and delivered by a duly
authorized officer of Riser Foods, Inc., and all of the conditions
precedent to such Amendment shall have been satisfied.
4.3 Acknowledgement of Guarantors. The Banks and the
Agent shall have received the Acknowledgement of Guarantors
attached to this Amendment, executed and delivered by a duly
authorized officer of each of the Guarantors of the indebtedness of
the Borrower to the Banks and the Agent.
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<PAGE>
4.4 Borrower's Certificate. The Banks and the Agent
shall have received a certificate, in form and substance satisfac-
tory to the Agent, executed for and on behalf of the Borrower by
the Chief Executive Officer and the Secretary of the Borrower and
dated as of the date of this Amendment, certifying (i) the
Director's Resolutions of the Borrower, authorizing this Amendment,
and each document or other instrument executed in connection with
the Amendment, (ii) the names and signatures of the officers of the
Borrower, and (iii) compliance by the Borrower with all representa-
tions, warranties, covenants and conditions under the Credit
Agreement, as amended by this Amendment.
4.5 Other Documents. The Banks and the Agent shall have
received each additional document, instrument or piece of
information reasonably requested by the Agent, including, without
limitation, any financing statements as may be necessary to
continue the perfection of the security interests created by the
Security Agreements.
SECTION 5. MISCELLANEOUS.
5.1 Governing Law. This Amendment shall be governed by
and construed in accordance with the laws of the State of Ohio.
5.2 Severability. In the event any provision of this
Amendment should be invalid, the validity of the other provisions
hereof and of the Credit Agreement shall not be affected thereby.
5.3 Counterparts. This Amendment may be executed in one
or more counterparts, each of which, when taken together, shall
constitute but one and the same agreement.
-6-
PAGE
<PAGE>
IN WITNESS WHEREOF, the Borrower has caused this
Amendment No. 1 to Amended and Restated Credit Agreement to be duly
executed and delivered by its duly authorized officer as of the
date first above written.
AMERICAN SEAWAY FOODS, INC.
___________________________________
By:________________________________
Title:_____________________________
ACCEPTED AND AGREED as of this
___ day of October, 1994:
SOCIETY NATIONAL BANK, as a Bank and as Agent
_______________________________
By:____________________________
Title:_________________________
NATIONAL CITY BANK, as a Bank
_______________________________
By:____________________________
Title:_________________________
NBD BANK, N.A., as a Bank
_______________________________
By:____________________________
Its:___________________________
PNC BANK, NATIONAL ASSOCIATION,
as a Bank
_______________________________
By:____________________________
Title:_________________________
STAR BANK, N.A., as a Bank
_______________________________
By:____________________________
Its:__________________________
352\22687ACD.120
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PAGE
<PAGE>
ACKNOWLEDGEMENT OF GUARANTORS
Each of the undersigned, RISER FOODS, INC., SEAWAY FOOD
SERVICE, INC. (formerly known as American Seaway Foods, Inc.),
RINI-REGO SUPERMARKETS, INC., and FISHER PROPERTIES, INC., each of
which being a guarantor of indebtedness of the Borrower to the
Banks and the Agent, hereby acknowledges and agrees to the terms of
the foregoing Amendment No. 1 to Amended and Restated Credit
Agreement. Each of the undersigned represents and warrants to the
Banks and the Agent that the respective Amended and Restated
Guaranty Agreements (as amended), executed and delivered by each of
the undersigned, each dated as of May 27, 1993, remain the valid
and binding obligations of each of the undersigned, respectively,
enforceable against it in accordance with their terms.
RISER FOODS, INC.
________________________________
By:_____________________________
Title:__________________________
SEAWAY FOOD SERVICE, INC. (formerly
known as American Seaway Foods,
Inc.)
_________________________________
By:______________________________
Title:___________________________
RINI-REGO SUPERMARKETS, INC.
_________________________________
By:______________________________
Title:___________________________
FISHER PROPERTIES, INC.
__________________________________
By:_______________________________
Title:____________________________
Executed: October __, 1994
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PAGE
<PAGE>
<PAGE>
EXHIBIT 10.58
PAGE
<PAGE>
<PAGE>
EXECUTION COPY
AMENDMENT NO. 3
TO
AMENDED AND RESTATED
GUARANTY AGREEMENT
This Amendment No. 3 to Amended and Restated Guaranty
Agreement (this "Amendment"), made as of the 28th day of April,
1995, among RISER FOODS, INC., a Delaware corporation (herein the
"Guarantor"), the Banks (as hereinafter defined), and SOCIETY
NATIONAL BANK, as agent for the Banks (herein the "Agent").
WITNESSETH:
WHEREAS, the Guarantor has executed and delivered to
the financial institutions which are a party to the Credit
Agreements(as defined below) (the "Banks"), that certain Amended
and Restated Guaranty Agreement, dated as of May 27, 1993 (as
amended pursuant to Amendment No. 1 to Amended and Restated
Guaranty Agreement, dated as of May 16, 1994, and Amendment No. 2
to Amended and Restated Guaranty Agreement, dated as of October 6,
1994, the "Guaranty Agreement"), pursuant to which the Guarantor
unconditionally guaranteed the payment of all of the Obligations
(as defined in the Guaranty Agreement);
WHEREAS, Rini-Rego Supermarkets, Inc. (formerly
known as Fisher Foods, Inc.) an Ohio corporation ("Rini-Rego"), the
Banks and the Agent have entered into that certain Amended and
Restated Credit Agreement, dated as of May 27, 1993 (as amended
pursuant to Amendment No. 1 to Amended and Restated Credit
Agreement, dated as of May 16, 1994, and Amendment No. 2 to Amended
and Restated Credit Agreement, dated as October 6, 1994, the
"Rini-Rego Agreement"), pursuant to which the Banks have made
certain financial accommodations available to Rini-Rego;
WHEREAS, American Seaway Foods, Inc., an Ohio
corporation ("American"), the Banks and the Agent have entered into
that certain Amended and Restated Credit Agreement, dated as of May
27, 1993 (as amended pursuant to Amendment No. 1 to Amended and
Restated Credit Agreement, dated as of October 6, 1994) (the
"American Agreement" and, together with the Rini-Rego Agreement,
the "Credit Agreements");
WHEREAS, the Banks which are signatories hereto
constitute all of the Banks for the purpose of amending the
Guaranty Agreement pursuant to Section 8.22 of the American
Agreement and Section 8.21 of the Rini-Rego Agreement; and
WHEREAS, the Guarantor, the Banks and the Agent
desire further to amend the Guaranty Agreement as set forth herein.
-1-
PAGE
<PAGE>
NOW, THEREFORE, in consideration of the mutual
promises and agreements contained herein and other good and
valuable consideration, the receipt and adequacy of which are
hereby acknowledged, the Guarantor, the Banks and the Agent do
hereby agree as follows:
SECTION 1. DEFINED TERMS.
Each defined term used herein and not otherwise
defined herein shall have the meaning ascribed to such term in the
Guaranty Agreement.
SECTION 2. AMENDMENTS TO THE GUARANTY AGREEMENT.
The Guarantor, the Banks and the Agent hereby agree
that the following Sections of the Guaranty Agreement shall be
amended, effective as of the date hereof and subject to the terms
and conditions hereof, as follows:
2.1 Amendment to Section 7(l). Section 7(l)
shall be amended to delete the covenant of Consolidated Leverage in
its entirety and to substitute in lieu thereof the following:
(l) Consolidated Leverage. The Guarantor shall
not suffer or permit, as at the end of any Fiscal Quarter, the
ratio of Consolidated Total Liabilities to Consolidated Tangible
Ne Worth at such date to exceed the maximum ratios
permitted for such Fiscal Quarter as set forth below:
<TABLE>
<CAPTION>
Maximum
Leverage Ratio Fiscal Quarter Ending
<C> <S>
4.0 to 1.0 During Fiscal Year 1993
4.0 to 1.0 During Fiscal Year 1994
4.0 to 1.0 October 22, 1994
3.75 to 1.0 January 14, 1995
3.75 to 1.0 April 8, 1995
3.75 to 1.0 July 1, 1995
3.25 to 1.0 During Fiscal Year 1996
2.75 to 1.0 During Fiscal Year 1997
2.5 to 1.0 During Fiscal Year 1998
</TABLE>
2.2 Amendment to Section 7(p). Section 7(p)
shall be amended to delete the covenant of Capitalized Leases in
its entirety and to substitute in lieu thereof the following:
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<PAGE>
(p) Capitalized Leases. The Guarantor shall not
incur, and shall not permit its Subsidiaries to incur, any
Indebtedness under Capitalized Leases, the MetLife Agreement
or the Store Construction Agreements with respect to
equipment that would cause the aggregate of all Indebtedness
under Capitalized Leases, the MetLife Agreement or the Store
Construction Agreements by the Guarantor and its
Subsidiaries on a consolidated basis to exceed an aggregate
amount of Ten Million Dollars ($10,000,000.00) in any Fiscal
Year.
2.3 Amendment to Section 7(t). Section 7(t)
shall be amended to delete the covenant of Consolidated Capital
Expenditures in its entirety and to substitute in lieu thereof the
following:
(t) Consolidated Capital Expenditures. The
Guarantor shall not make, for any Fiscal Year, any
Consolidated Capital Expenditures that would cause the
Consolidated Capital Expenditures to exceed the maximum
amount of Consolidated Capital Expenditures allowed to have
been made during any Fiscal Year as set forth below:
<TABLE>
<CAPTION>
Consolidated
Capital Expenditures
Fiscal Year Maximum Amount
<S> <C>
1993 $26,667,000
1994 $26,143,000
1995 $34,000,000
1996 $30,000,000
1997 $30,000,000
1998 $30,000,000
</TABLE>
provided, however, that, in any Fiscal Year, the Guarantor
may, in addition to the Consolidated Capital Expenditures
permitted for such Fiscal Year also incur additional
Consolidated Capital Expenditures equal to the Consolidated
Capital Expenditure Excess Amount from the immediately
preceding Fiscal Year. For purposes of calculating the
Guarantor's compliance with this Section 7(t), the amount of
Consolidated Capital Expenditures during any Fiscal Year
shall be applied first to the maximum amount set forth above
and then to any Consolidated Capital Expenditures Excess
Amount available from the immediately preceding Fiscal Year;
provided, further, that the Consolidated Capital
Expenditures Maximum Amount for Fiscal Year 1996 shall
exclude any and all transactions with respect to Building
No. 5 and the Cash-n-Carry Building.
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<PAGE>
2.4 Amendment to Section 7(u). Section 7(u)
shall be amended to delete the covenant of Sales, Etc. of Assets in
its entirety and to substitute in lieu thereof the following:
(u) Sales, Etc. of Assets. The Guarantor shall
not and shall not permit any of its Subsidiaries, to sell,
lease, transfer, convey or otherwise dispose of any of its
assets; provided, however, that (A) Rini-Rego may sell the
Specified Assets (as defined in the Rini-Rego Agreement),
(B) Rini-Rego and American may sell any Equipment owned by
such party by reason of such party's exercising its rights
to repossession or sale of such Equipment previously owned
by a customer or debtor of such party pursuant to a security
agreement in favor of such party (the "Financed Customer
Assets"), (C) any piece of its Equipment (as defined in each
of the Security Agreements), so long as each of the
following conditions shall have been satisfied: (i) with
respect to the piece of Equipment which is owned by the
Guarantor or any of its Subsidiaries and which is proposed
to be sold, the net book value thereof does not exceed
$150,000, (ii) with respect to all such pieces of Equipment
sold in any Fiscal Year by the Guarantor and each of
its Subsidiaries, the aggregate net book value thereof does
not exceed $500,000, (iii) all proceeds received from any
sale referred to in this clause (C), by the
Guarantor or any of its Subsidiaries shall have been
received by the Guarantor or such Subsidiary in trust for
the benefit of the Banks and the Agent, and all such
proceeds shall have been deposited by the Guarantor or such
Subsidiary, or the Guarantor shall have caused such proceeds
to be deposited into the Cash Collateral Account (as defined
in the Security Agreements) and (iv) such proceeds shall be
applied and/or released (x) in the case of sales by the
Guarantor, Seaway or Fisher Properties, in accordance with
the terms of the Security Agreements of such parties and (y)
in the case of sales by either Rini-Rego or American,
applied in accordance with Section 2.05 of the Rini-Rego
Agreement or the American
Agreement, as the case may be or (D) American may sell
Building No. 5 and the Cash-n-Carry Building so long as the
net cash proceeds of such sales are applied in accordance
with Section 2.05 of the American Agreement.
2.5 Amendment to Section 7(y). Section 7(y)
shall be amended to delete the covenant of Sale and Leaseback in
its entirety and to substitute in lieu thereof the following:
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<PAGE>
(y) Sale and Leaseback. The Guarantor shall not enter into
any transaction in which the Guarantor sells property owned
by the Guarantor and subsequently leases such property from
the purchaser thereof except under the Store Construction
Agreements.
2.6 Amendment to Section 7(z). Section 7(z) shall be
amended to delete the covenant of Dividends, etc. in its entirety
and to substitute in lieu thereof the following:
(z) Dividends, Etc. The Guarantor shall not make any
Capital Distribution, declare or pay any dividends, purchase
or otherwise acquire for value, or, except to the extent
permitted under Section 5.02 of each of the Agreements,
permit any of its Subsidiaries to purchase or otherwise
acquire for value, any of the capital stock of the Guarantor
now or hereafter outstanding, or make any distribution of
stock or assets to the stockholders of the Guarantor;
provided, however, that, so long as no Default hereunder
shall have occurred and none shall be in existence after
giving effect to the making of such Capital Distribution,
the Guarantor may make Capital Distributions (A) in respect
of its preferred stock in an amount not to exceed Thirty-Six
Thousand Eighty-Eight Dollars ($36,088) per Fiscal Quarter
and (B) in respect of its common stock (i) during the Fiscal
Year ending in 1996, in the aggregate amount not to exceed
Two Million Four Hundred Twenty-Four Thousand Dollars
($2,424,000), (ii) during the Fiscal Year ending in 1997,
in the aggregate amount not to exceed Two Million Eight
Hundred Twenty-Eight Thousand Dollars ($2,828,000), and
(iii) during the Fiscal Year ending in 1998, in the
aggregate amount not to exceed Three Million Two
Hundred Thirty-Two Thousand Dollars ($3,232,000); provided,
further, that no such Capital Distribution shall be declared
or made if any Default shall have occurred and be continuing
or if after giving effect to such declaration or payment a
Default would occur hereunder.
2.7 Amendment to Section 8(i). Subsection (i) of
Section 8. shall be deleted in its entirety and the following shall
be substituted in lieu thereof:
(i) As soon as available and in any event within
thirty (30) days after the end of each Fiscal Period
(including the last Fiscal Period of any Fiscal Year)
consolidating and consolidated balance sheets of the
Guarantor and its Subsidiaries in form and substance as the
Agent may reasonably request, and related consolidating and
consolidated statements of income in form and substance as
the Agent may reasonably request, all prepared in accordance
with generally accepted accounting principles.
-5-
PAGE
<PAGE>
2.8 Amendment to Section 14. Section 14 shall be
amended to add the definitions of "Building No. 5 and the Cash-n-
Carry Building" and "Store Construction Agreements":
"Building No. 5 and the Cash-n-Carry Building" means the real
property and improvements located at 22801 Aurora Road,
Bedford Heights, Ohio and 3900 Woodland Avenue, Cleveland,
Ohio, respectively.
"Store Construction Agreements" means each lease or loan
and security agreement entered into between Rini-Rego
(and Guarantor, if required) in connection with Store
Construction Indebtedness (as such term is defined in the
Rini-Rego Agreement), pursuant to which Rini-Rego will
finance the purchase of Capital Expenditures.
2.9 Amendment to Schedule I. Schedule I to the
Guaranty shall be amended to delete the Net Operating Cash Flow
requirements contained thereon and the Schedule I attached hereto
shall be substituted in its entirety in lieu thereof.
SECTION 3. REPRESENTATIONS AND WARRANTIES
The Guarantor hereby represents and warrants to the
Banks and the Agent as follows:
3.1 The Amendment. This Amendment has been duly
and validly executed by an authorized executive officer of the
Guarantor and constitutes the legal, valid and binding obligation
of the Guarantor enforceable against the Guarantor in accordance
with its terms.
3.2 Guaranty Agreement. The Guaranty Agreement,
as amended by this Amendment, remains in full force and effect and
remains the valid and binding obligation of the Guarantor
enforceable against the Guarantor in accordance with its terms.
The Guarantor hereby ratifies and confirms the Guaranty Agreement
as amended by this Amendment.
3.3 Nonwaiver. The execution, delivery,
performance and effectiveness of this Amendment shall not
operate nor be deemed to be nor construed as a waiver (i) of any
right, power or remedy of the Banks or the Agent under the Guaranty
Agreement, nor (ii) of any term, provision, representation,
warranty or covenant contained in the Guaranty Agreement or any
other documentation executed in connection therewith. Further,
none
-6-
PAGE
<PAGE>
of the provisions of this Amendment shall constitute, be deemed to
be or construed as, a waiver of any Default of Event of Default
under the Guaranty Agreement as amended by this Agreement.
3.4 Reference to and Effect on the Guaranty
Agreement. Upon the effectiveness of this Amendment, each reference
in the Guaranty Agreement to "this Agreement", "hereunder",
"hereof", "herein", or words of like import shall mean and be a
reference to the Guaranty Agreement, as amended hereby and each
reference to the Guaranty Agreement in any other document,
instrument or agreement executed and/or delivered in connection
with the Guaranty Agreement shall mean and be a reference to the
Guaranty Agreement, as amended by this Amendment.
SECTION 4. CONDITIONS PRECEDENT TO EFFECTIVENESS
OF THIS AMENDMENT NO. 3.
In addition to all of the other conditions and
agreements set forth herein, the effectiveness of this Amendment is
subject to the following conditions precedent:
4.1 The Amendment. The Banks and the Agent shall have
received this Amendment No. 3 to Amended and Restated Guaranty
Agreement, executed and delivered by a duly authorized officer of
the Guarantor.
4.2 Amendment No. 3 to Rini-Rego Agreement. The Banks
and the Agent shall have received an Amendment No. 3 to Amended and
Restated Credit Agreement from Rini-Rego, executed and delivered by
a duly authorized officer of Rini-Rego, and all of the respective
conditions precedent to such Amendment shall have been satisfied.
4.3 Amendment No. 2 to American Agreement. The Banks
and the Agent shall have received an Amendment No. 2 to Amended and
Restated Credit Agreement from American, executed and delivered by
a duly authorized officer of American, and all of the respective
conditions precedent to such Amendment shall have been satisfied.
4.4 Acknowledgement of Borrowers. The Banks and the
Agent shall have received the Acknowledgement of Borrowers attached
to this Amendment, executed and delivered by a duly authorized
officer of each of Rini-Rego and American.
4.5 Guarantor's Certificate. The Banks and the Agent
shall have received a certificate, in form and substance
satisfactory to the Agent, executed for and on behalf of the
Guarantor by the Chief Executive Officer and the Secretary of the
Guarantor and dated as of the date of this Amendment, certifying
(i) the Director's Resolutions of the Guarantor
-7-
PAGE
<PAGE>
authorizing this Amendment, and each document or other instrument
executed in connection with the Amendment, (ii) the names and
signatures of the officers of the Guarantor, and (iii) compliance
by the Guarantor with all representations, warranties, covenants
and conditions under the Guaranty as amended by this Amendment.
4.6 Other Documents. The Banks and the Agent shall have
received each additional document, instrument or piece of
information reasonably requested by the Agent, including, without
limitation, any financing statements as may be necessary to
continue the perfection of the security interests created by the
Security Agreements.
SECTION 5. MISCELLANEOUS.
5.1 Governing Law. This Amendment shall be governed by
and construed in accordance with the laws of the State of Ohio.
5.2 Severability. In the event any provision of this
Amendment should be invalid, the validity of the other provisions
hereof and of the Guaranty Agreement shall not be affected thereby.
5.3 Counterparts. This Amendment may be executed in one
or more counterparts, each of which, when taken together, shall
constitute but one and the same agreement.
-8-
PAGE
<PAGE>
IN WITNESS WHEREOF, the Guarantor has caused this
Amendment No. 3 to Amended and Restated Guaranty Agreement to be
duly executed and delivered by its duly authorized officer as of
the date first above written.
RISER FOODS, INC.
By:
Title:
ACCEPTED AND AGREED as of
the date and year first above written by:
SOCIETY NATIONAL BANK, as a NBD BANK (formerly
Bank and as Agent known as NBD Bank, N.A.)
By: By:
Title: Title:
NATIONAL CITY BANK, STAR BANK, N.A.,
as a Bank as a Bank
By: By:
Title: Title:
180\22687EAB.120
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ACKNOWLEDGEMENT OF BORROWERS
Each of the undersigned, RINI-REGO SUPERMARKETS, INC.
(formerly known as Fisher Foods, Inc.) and AMERICAN SEAWAY FOODS,
INC. (formerly known as Heritage Wholesalers, Inc.), each of
whichbeing a borrower of certain sums from the Banks under the
Agreements (as defined in the Guaranty Agreement), hereby
acknowledges and agrees to the terms of the foregoing Amendment No.
3 to Amended and Restated Guaranty Agreement. Each
of the undersigned represents and warrants to the Banks and the
Agent that the respective Agreements (as amended), executed and
delivered by each of the undersigned, remain the valid
and binding obligations of each of the undersigned, respectively,
enforceable against it in accordance with their terms.
RINI-REGO SUPERMARKETS, INC.
(formerly known as Fisher Foods, Inc.)
By:
Title:
AMERICAN SEAWAY FOODS, INC.
(formerly known as Heritage
Wholesalers, Inc.)
By:
Title:
Executed: April , 1995
180\22687EAB.120
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<TABLE>
<CAPTION>
SCHEDULE I
TO
GUARANTY AGREEMENT
FISCAL QUARTER MINIMUM REQUIRED
ENDING AMOUNT OF NET OPERATING
CASH FLOW
<S> <C>
7/3/93 $17,391,000
10/23/93 $6,845,000
1/15/94 $10,980,000
4/9/94 $15,943,000
7/2/94 $18,542,000
10/22/94 $ 7,053,000
1/14/95 $11,312,000
4/8/95 $16,291,000
7/1/95 $23,632,000
10/21/95 $ 7,450,000
1/13/96 $12,035,000
4/6/96 $17,281,000
6/29/96 $25,015,000
10/19/96 $ 7,715,000
1/11/97 $12,496,000
4/5/97 $17,917,000
6/28/97 $25,886,000
10/18/98 $ 7,715,000
1/10/98 $12,496,000
4/4/98 $17,917,000
6/27/98 $25,886,000
180\22687EAB.120
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<PAGE>
</TABLE>
<PAGE>
EXHIBIT 10.59
PAGE
<PAGE>
<PAGE> EXECUTION COPY
AMENDMENT NO. 3
TO
AMENDED AND RESTATED
CREDIT AGREEMENT
This Amendment No. 3 to Amended and Restated Credit
Agreement (this "Amendment"), made as of the 28th day of April,
1995, between RINI-REGO SUPERMARKETS, INC. (formerly known as
Fisher Foods, Inc.), an Ohio corporation (herein the "Borrower"),
the Banks (as hereinafter defined) and SOCIETY NATIONAL BANK, as
agent for the Banks (in such capacity, the "Agent"),
WITNESSETH:
WHEREAS, the Borrower has been extended certain financial
accommodations pursuant to that certain Amended and Restated Credit
Agreement, dated as of May 27, 1993 (as amended pursuant to
Amendment No. 1 to Amended and Restated Credit Agreement, dated as
of May 16, 1994 (the "First Amendment"), and Amendment No. 2 to
Amended and Restated Credit Agreement, dated as of October 6, 1994
(the "Second Amendment"), as so amended the "Credit Agreement"),
among the Borrower, the financial institutions which are a party
thereto (the "Banks") and the Agent;
WHEREAS, the Borrower, the Banks and the Agent desire to
amend the Credit Agreement as set forth herein; and
WHEREAS, the Banks which are the signatories hereto
constitute all of the Banks for the purposes of amending the Credit
Agreement pursuant to Section 8.21 thereof.
NOW THEREFORE, in consideration of the mutual promises
and agreements contained herein and other good and valuable
consideration, the receipt and adequacy of which are hereby
acknowledged, the Borrower, the Banks and the Agent do hereby agree
as follows:
SECTION 1. DEFINED TERMS.
Each defined term used herein and not otherwise defined
herein shall have the meaning ascribed to such term in the Credit
Agreement.
SECTION II. AMENDMENTS TO THE CREDIT AGREEMENT.
The Borrower, the Banks and the Agent hereby agree that
the Credit Agreement shall be amended, effective as of the date
hereof and subject to the terms and conditions hereof, as follows:
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Amendment to Section 1.01. The following
definitions found in Section 1.01 shall each be amended in its
entirety to read as follows:
"Business Day" means a day of the year on which banks are not
required or authorized to close in Cleveland, Ohio and, if the
applicable Business Day relates to any LIBOR Rate Loans, a day of
the year on which dealings in dollar deposits are carried on in the
London interbank market and banks are open for business in London.
"Collateral" means all property and assets of the Borrower,
including without limitation, the Collateral described in the
Patent Agreement of the Borrower, and in Section 1 of the Security
Agreement of the Borrower and in Section 1 of the Motor Vehicle
Security Agreement of the Borrower, and the Real Property and
Leaseholds described in the Mortgages of the Borrower but excluding
the property and assets financed pursuant to the Store Construction
Indebtedness.
"Loans" means, collectively, all loans and advances provided
for in Article II hereof, including, without limitation, the
Revolving Credit Advances consisting of LIBOR Rate Loans and Prime
Rate Loans.
"Permitted Liens" means (i) Existing Liens; (ii) the MetLife
Liens; (iii) the Fifth Third Liens; (iv) Liens for taxes not yet
payable or Liens for taxes, assessments or governmental charges or
levies to the extent not required to be paid by the Borrower or any
of its Subsidiaries under Section 5.01(g) hereof; (v) Liens in
favor of the Banks; (vi) Liens upon Equipment granted in connection
with the acquisition of such Equipment by the Borrower after the
date hereof (including, without limitation, pursuant to capital
leases); provided, however, that the Liens described in (vi) hereof
shall be permitted only if (a) the cost of each item of equipment
so acquired constitutes a Capital Expenditure permitted by Section
7(t) of the Guaranty Agreement of Riser, (b) the Indebtedness
incurred to finance each such acquisition is permitted by Section
5.02(b), (c) each such Lien attaches only to the Equipment acquired
with the Indebtedness secured thereby, and (d) the principal amount
of the indebtedness secured by any item of equipment shall not
exceed one hundred percent (100%) of the purchase price thereof;
(vii) reservations, exceptions, encroachments, easements, rights of
way, covenants, conditions, restrictions, leases and other similar
title exceptions or encumbrances affecting Borrower's or any
Subsidiary's real property; provided, however, such Liens described
in (vii) hereof shall be permitted only so long as they do not in
the aggregate materially detract from the value of said properties
or materially interfere with
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their use in the ordinary conduct of the Borrower's or any
Subsidiary's business; (viii) pledges or deposits under worker's
compensation, unemployment insurance, social security and other
similar laws; (ix) liens relating to statutory obligations with
respect to surety and appeal bonds, performance bonds and other
obligations of a like nature incurred in the ordinary course of
business; (x) unperfected liens imposed by law against Borrower's
or any Subsidiary's real property and equipment only, such as
materialmen's mechanic's carrier's and repairmen's liens and other
similar liens, arising in the ordinary course of business securing
obligations which are not overdue for a period of more than thirty
(30) days; provided, however, no Lien in favor of the PBGC shall in
any event be a "Permitted Lien"; provided, further, none of the
liens, security interests or other encumbrances listed in clauses
(i) through (x) above shall, in any event, constitute a "Permitted
Lien" on and after the commencement in respect hereof of any
enforcement, collection, execution, levy or foreclosure
proceeding, unless (a) any such enforcement, collection, execution,
levy or foreclosure proceeding is with respect to Equipment having
a fair market value of less than Fifteen Thousand Dollars
($15,000.00), (b) the dollar value of such claim giving rise to any
such enforcement, collection, execution, levy or foreclosure
proceeding is less than Five Thousand Dollars ($5,000.00) and (c)
the aggregate amount of all such claims shall in no event exceed
Twenty Thousand Dollars ($20,000.00); and (xi) the Store
Construction Liens.
"Termination Date" means the date upon which the Revolving
Credit Commitment of each of the Banks terminates which shall be
July 6, 1998 or such earlier date pursuant to Article VI.
2.2 Amendment to Section 1.01. Section 1.01 shall be
amended to include the following definitions in the appropriate
alphabetical order:
"Eurocurrency Liabilities" has the meaning assigned to that
term in Regulation D of the Board of Governors of the Federal
Reserve System, as in effect from time to time.
"Eurocurrency Reserve Percentage" of any Bank for the Interest
Period for any LIBOR Rate Loan means the reserve percentage
applicable during such Interest Period (or if more than one such
percentage shall be so applicable, the daily average of such
percentages for those days in such Interest Period during which any
such percentage shall be so applicable) under regulations issued
from time to time by the Board of Governors of the Federal Reserve
System (or any successor) for determining
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the maximum reserve requirement (including, without limitation, any
emergency, supplemental or other marginal reserve requirement) for
such Bank with respect to liabilities or assets consisting of or
including Eurocurrency Liabilities having a term equal to such
Interest Period.
"Interest Period" means, for each of the LIBOR Rate Loans
comprising a Borrowing, the period commencing on the date of such
Loans or the date of the Rate Conversion or Rate Continuation of
any Loans into such Loans and ending on the numerically
corresponding day of the period selected by the Borrower pursuant
to the provisions hereof and each subsequent period commencing on
the last day of the immediately preceding Interest Period in
respect of such Loans and ending on the last day of the period
selected by the Borrower pursuant to the provisions hereof. The
duration of each such Interest Period shall be one, two, three or
six months, in each case as the Borrower may select, upon delivery
to the Agent of a Notice of Borrowing therefor in accordance with
Section 2.02(a) hereof; provided, however, that:
(a)Interest Periods for Loans comprising part of the same Borrowing
shall be of the same duration;
(b)with respect to LIBOR Rate Loans comprising any Borrowings, no
Interest Period may end on a date later than the Termination Date;
(c)whenever the last day of any Interest Period would otherwise
occur on a day other than a Business Day, the last day of such
Interest Period shall be extended to occur on the next succeeding
Business Day; provided, however, that if such extension would cause
the last day of such Interest Period to occur in the next following
calendar month, the last day of such Interest Period shall occur on
the immediately preceding Business Day;
(d)if the Interest Period commences on a Business Day for which
there is no numerical equivalent in the calendar month in which the
Interest Period is to end, such Interest Period shall end on the
last Business Day of that calendar month; and
(e)the Borrower may not select any Interest Period ending after the
date of any mandatory reduction specified in Section 2.05 or
2.04(a)
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unless, after giving effect to such selection, the aggregate unpaid
principal amount of any then outstanding Prime Rate Loans taken
together with the principal amount of any then outstanding LIBOR
Rate Loans having Interest Periods ending on or prior to the date
of such mandatory reduction shall be at least equal to the
principal amount of the Revolving Credit Advances due and payable
on or prior to such date.
"Law" means any federal, state, local or foreign law,
ordinance or regulation or any order, case precedent, ruling,
directive, judgment, injunction, award or decree or request having
the force of law or any other requirement of any governmental or
regulatory body, court, tribunal or arbitrator.
"LIBOR Rate" means, with respect to any LIBOR Rate Loan
for any Interest Period, an interest rate per annum (rounded upward
to the nearest 1/16th of 1%) equal to the average of the per annum
rates at which deposits in immediately available funds in United
States dollars approximately equal in principal amount to the
Agent's portion of such Borrowing consisting of Revolving Credit
Advances and for a maturity comparable to the Interest Period are
offered to the Reference Bank by prime banks in any Eurodollar
market reasonably selected by the Reference Bank, determined as of
4:00 p.m. London time (or as soon thereafter as practicable), two
(2) Business Days prior to the beginning of the relevant Interest
Period pertaining to a LIBOR Rate Loan thereunder.
"LIBOR Rate Loan" means a Loan which bears interest at the
LIBOR Rate plus the LIBOR Rate Margin.
"LIBOR Rate Margin" means two and three-quarters percent (2-
3/4%) per annum, subject to adjustment pursuant to Section 2.06(b).
"Prime Rate Loan" means a Loan which bears interest at the
Prime Rate plus the Prime Rate Margin.
"Prime Rate Margin" means one-half percent (1/2%) per annum,
subject to adjustment pursuant to Section 2.06(b)
"Rate Continuation" means a continuation of LIBOR Rate Loans
having a particular Interest Period as LIBOR Rate Loans having an
Interest Period of the same duration pursuant to Section 2.02(d).
"Rate Conversion" refers to a conversion pursuant to Section
2.02(d) of Prime Rate Loans into LIBOR Rate Loans or
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LIBOR Rate Loans into Prime Rate Loans and, with respect to LIBOR
Rate Loans, a conversion of LIBOR Rate Loans from one permissible
Interest Period to another permissible Interest Period.
"Rate Conversion/Continuation Request" means a request for
Rate Conversion or Rate Continuation and made pursuant to Section
2.02(d).
"Reference Bank" means the Cayman Islands branch office of
Society National Bank.
"Store Construction Indebtedness" means the indebtedness
incurred by the Borrower which may be guaranteed by Riser, in the
aggregate principal amount in any of the 1995, 1996, 1997 and 1998
Fiscal Years not to exceed Five Million Dollars ($5,000,000) in any
such Fiscal Year, pursuant to lease(s) or loan and security
agreement(s), to be executed by Borrower (and Riser, if required)
in favor of such lessor(s) or lender(s) which lease(s) or loan and
security agreement(s) shall be in form and substance reasonably
satisfactory to the Agent and the Majority Banks for new store
construction or store renovation provided the Equipment or other
property purchased with such indebtedness is not commingled with
the Collateral.
"Store Construction Liens" means the Liens on specific
Equipment of the Borrower securing the Store Construction
Indebtedness.
2.3 Amendment to Credit Agreement. Each reference to
the word "law" in the Credit Agreement shall be amended to read
"Law" as defined in Section 1.01.
2.4 Amendment to Add Exhibits. The Credit Agreement is
hereby amended to add Attachment 1 to this Amendment as Exhibit B
to the Credit Agreement (Form of Notice of Borrowing) and
Attachment 2 to this Agreement as Exhibit C to the Credit Agreement
(Form of Rate Conversion/Continuation Request).
2.5 Amendment to Section 2.01(b). Section 2.01(b) shall
be deleted in its entirety and the following shall be substituted
in lieu thereof:
(b) Borrowings. Each borrowing under this Article II (a
"Borrowing") shall consist of a group of Revolving Credit Advances
consisting entirely of Prime Rate Loans or LIBOR Rate Loans, made
by the Banks ratably in accordance with their Pro Rata Share, on
the same date, and, in the case of LIBOR Rate Loans, as to which a
single Interest Period is in effect. Any group of Revolving Credit
Advances made by the Banks having different interests rates or
having a different Interest Period (regardless of whether such
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Interest Period commences on the same date as another Interest
Period), or made on a different date shall be considered to
comprise a different Borrowing.
2.6 Amendment to Section 2.01(f). Section 2.01(f) shall
be deleted in its entirety.
2.7 Amendment to Section 2.02(a). Section 2.02(a) shall
be deleted in its entirety and the following shall be substituted
in lieu thereof:
(a) Revolving Credit Advances; Settlement.
(i) Minimum Borrowing Amounts. Each Borrowing comprised of
LIBOR Rate Loans shall be in an aggregate amount not less than
Three Million Dollars ($3,000,000) or multiples of One Million
Dollars ($1,000,000) in excess thereof. The Borrower shall be
entitled to have more than one Borrowing outstanding at one time;
provided, however, that, unless the Agent and the Banks shall
otherwise agree in writing, the Borrower shall not be entitled to
request any Borrowing which would result in any Bank's having an
aggregate of more than two (2) LIBOR Rate Loans outstanding at any
one time.
(ii) Notice of Borrowing. Revolving Credit Advances
comprising a Borrowing shall be made upon notice (a "Notice of
Borrowing") given by the Borrower to the Agent (i) not later than
2:00 p.m. (Cleveland, Ohio time) on the Business Day which is the
requested date of a proposed Borrowing comprised of Prime Rate
Loans and (ii) not later than 12:00 noon (Cleveland, Ohio time)
three (3) Business Days prior to the requested date of a proposed
Borrowing comprised of LIBOR Rate Loans. Each Notice of Borrowing
for a Borrowing comprised of LIBOR Rate Loans shall be
substantially in the form of Exhibit B hereto and shall specify
therein (A) the requested date of the Borrowing, (B) that such
Borrowing is to be comprised of LIBOR Rate Loans, (C) the name of
the bank and the account number to which such funds are to be
disbursed, (D) aggregate amount of such Revolving Credit Advances
and (E) the initial Interest Period for such LIBOR Rate Loans
comprising such Borrowing. Each Notice of Borrowing shall be
irrevocable and binding on the Borrower and subject to the
indemnification provisions of this Article II.
(iii) Settlement. Each Bank irrevocably agrees to settle
with the Agent forthwith upon each request of the Agent at such
time and such frequency as the Agent in its sole discretion may
determine, but in any event not
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less frequently than weekly, on the net average daily amount of
Revolving Credit Advances outstanding during the period since the
last such settlement such that if such average daily amount is
greater than the average daily amount for the preceding such
period, each Bank shall pay to the Agent its Pro-Rata Share of such
increase and if such average daily amount is less than the average
daily amount for the preceding such period, the Agent will remit to
each Bank its Pro-Rata Share of such decrease.
2.8 Amendment to Section 2.02. Section 2.02 shall be
amended to add the following as new Section 2.02(e):
(e) Rate Conversion and Rate Continuation of Revolving Credit
Advances. The Borrower shall have the right, upon request
delivered by the Borrower to the Agent (i) not later than 12:00
noon (Cleveland time) on the Business Day that Borrower desires to
convert any LIBOR Rate Loans comprising a Borrowing into Prime Rate
Loans so as to comprise a Borrowing, (ii) not later than 12:00 noon
(Cleveland time) three (3) Business Days prior to a Rate
Conversion, to convert any Prime Rate Loans comprising a Borrowing
into LIBOR Rate Loans for a given Interest Period so as to comprise
a Borrowing, (iii) not later than 12:00 noon (Cleveland time) three
(3) Business Days prior to a Rate Continuation, to continue any
LIBOR Rate Loans comprising a given Borrowing as LIBOR Rate Loans
for an additional Interest Period of the same duration so as to
comprise a Borrowing and (iv) not later than 12:00 noon (Cleveland
time) three (3) Business Days prior to a Rate Conversion, to
convert any LIBOR Rate Loans having a particular Interest Period
comprising a Borrowing into LIBOR Rate Loans having a different
permissible Interest Period so as to comprise a Borrowing;
provided, however, that each such Rate Conversion or Rate
Continuation shall be subject to the following:
(A) each Rate Conversion or Rate Continuation shall be made among
the Banks based upon each Bank's Pro Rata Share of such converted
or continued Revolving Credit Advances comprising a Borrowing,
(B) if less than all the outstanding principal amount of the
Revolving Credit Advances comprising a Borrowing is converted or
continued, the aggregate principal amount of such Revolving Credit
Advances converted or continued shall be in the case of LIBOR Rate
Loans, not less than Three Million Dollars ($3,000,000), or a
multiple of One Million Dollars ($1,000,000) in excess thereof,
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(C) each Rate Conversion or Rate Continuation shall be effected by
each Bank by applying the proceeds of the Revolving Credit Advances
resulting from such Rate Conversion or Rate Continuation to the
Revolving Credit Advance of such Bank being converted or continued,
as the case may be, and the accrued interest on any such Revolving
Credit Advance (or portion thereof) being converted or continued
shall be paid to the Agent on behalf of each Bank by the Borrower
at the time of such Rate Conversion or Rate Continuation,
(D) LIBOR Rate Loans shall not be converted or continued at a time
other than the end of an Interest Period applicable thereto unless
the Borrower shall pay, upon demand, any amounts due to the Banks
pursuant to this Article II,
(E) Revolving Credit Advances comprising a Borrowing may not be
converted into or continued as LIBOR Rate Loans less than one month
prior to the Termination Date,
(F) Revolving Credit Advances comprising a Borrowing that cannot
be converted into or continued as LIBOR Rate Loans by reason of
clause (E) shall be automatically converted at the end of the
Interest Period in effect for such LIBOR Rate Loans into Prime Rate
Loans comprising a Borrowing,
(G) no Interest Period can be selected in connection with any Rate
Conversion or Rate Continuation ending after the date of any
mandatory reduction set forth in this Agreement unless, after
giving effect to such selection, the aggregate unpaid principal
amount of any then outstanding Prime Rate Loans taken together with
the principal amount of any then outstanding LIBOR Rate Loans
having Interest Periods ending on or prior to the date of such
mandatory reduction shall be at least equal to the principal amount
of the Revolving Credit Advance due and payable on or prior to such
date.
Each such request for a conversion or continuation (a "Rate
Conversion/Continuation Request") in respect of Revolving Credit
Advances comprising a Borrowing shall be transmitted by the
Borrower to the Agent substantially in the form of Exhibit C hereto
and shall specify (A) the identity and amount of the Revolving
Credit Advances comprising a Borrowing that the
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Borrower requests be converted or continued, (B) whether such
Revolving Credit Advances shall be converted into or continued as
LIBOR Rate Loans or Prime Rate Loans, (C) if such notice requests
a Rate Conversion, the date of the Rate Conversion (which shall be
a Business Day) and (D) in the case of Revolving Credit Advances
comprising a Borrowing being converted into or continued as LIBOR
Rate Loans, the Interest Period for such LIBOR Rate Loans. The
Agent shall promptly deliver on the day received a copy of each
such Conversion/Continuation Request to the Banks.
2.9 Amendment to Section 2.04(b). Section 2.04(b) shall
be deleted in its entirety and the following shall be substituted
in lieu thereof:
(b) Application.
(i) Except as otherwise provided in (a) above, the Borrower
irrevocably authorizes the Agent to apply such funds received by
the Agent (A) first to the Pro Rata Share of the Prime Rate Loans
made by the Banks as part of the same Borrowing ratably according
to the then outstanding principal amounts of such Prime Rate Loans
and (B) second to the Pro Rata Share of the LIBOR Rate Loans made
by the Banks as part of the same Borrowing ratably according to the
then outstanding principal amounts of such LIBOR Rate Loans.
(ii) The Borrower shall also repay on the Termination Date the
aggregate principal amount of the Revolving Credit Advances then
outstanding, in each case with accrued interest to the date of such
repayment on the amount repaid.
provided, however that, notwithstanding anything in this Section
2.04 to the contrary, in the event that the application of any
portion of prepayment required under Section 2.04(b)(i)(B) above
would cause the Borrower to incur a compensation obligation to any
Bank by reason of the prepayment of LIBOR Rate Loans on other than
the last day of an Interest Period, so long as no Event of Default
has occurred and is continuing (I) the Borrower may deposit such
amount with the Agent and direct the Agent to invest such amounts
in short term investments offered by the Agent and agreed to by the
Borrower and the Agent and held in the name of the Agent for the
benefit of the Borrower for such period as is necessary to avoid
such obligation but in no case maturing past the last day of the
Interest Period in question and (II) the Agent shall apply such
invested amount together with all interest earned thereon to the
repayment of the Revolving Credit Advances no later than on the
last day of such Interest Period; provided, further, that, upon the
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occurrence and continuation of an Event of Default, the Agent may,
upon the request of the Majority Banks, cause any amount so
invested to be applied to the Obligations in such manner as the
Majority Banks shall direct the Agent notwithstanding any penalty
arising under this Agreement.
2.10 Amendment to Section 2.05. Section 2.05 shall be
deleted in its entirety and the following shall be substituted in
lieu thereof:
(a) Aggregate Proceeds. The Borrower shall pay to the Agent
the sum (the "Aggregate Proceeds") of (i) the proceeds received by
the Borrower (after deduction for any direct costs of the
transaction payable in cash and, in the case of any lease subleased
by the Borrower to another Person, after deduction of any portion
of such proceeds paid by the Borrower to the lessor under such
Lease) of each sale, assignment, lease, sublet, transfer or other
disposition permitted under Section 5.02(c) by the Borrower of Real
Property, Leaseholds or any other asset (other than sales of
Inventory in the ordinary course of business), and (ii) any payment
received by the Borrower (whether as proceeds of any insurance
policy, any condemnation award or otherwise) in respect of a
Casualty Loss other than any payment received from a Casualty Loss
in respect to Inventory provided, however, that this Section 2.05
shall not apply to Aggregate Proceeds resulting from (A) the sale
of the Financed Customer Assets, (B) the sale of the Specified
Assets, (C) during any sale, assignment, lease, sublease, transfer
or other disposition of any of the Borrower's Assets, together with
all sales of assets by any other Loan Party, to the extent that the
aggregate of all such transfers does not exceed Five Hundred
Thousand Dollars ($500,000) in any Fiscal Year or (D) the receipt
of proceeds in connection with a sale and leaseback relating to the
Store Construction Indebtedness. The Aggregate Proceeds shall be
applied (as set forth in clause (b) below) to the prepayment, in
whole or, subject to the provisions of clause (b) below, ratably in
part, of the aggregate outstanding principal amount (calculated
after giving effect to all other simultaneous or prior payments or
prepayments made pursuant hereto) of the Loans, with accrued
interest to the date of such prepayment on the amount prepaid,
except to the extent that the proceeds of any Casualty Loss shall
have been made available by the Agent to the Borrower and shall
have been applied by the Borrower to the purchase price of
additional or replacement assets of the Borrower as to which all
actions required pursuant to Section 11 of the Security Agreement
or the sections of the Mortgages relating to the payment to the
Borrower of insurance proceeds or condemnation awards, as
applicable, shall have been taken.
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(b) Application. The Aggregate Proceeds shall be applied as
follows:
(i) so long as no Default shall have occurred and be
continuing, Aggregate Proceeds shall be applied first to Prime Rate
Loans and thereafter to LIBOR Rate Loans in accordance with
Schedule XVII hereto; and
(ii) in all other cases, to such Obligations of the Borrower
under the Loan Documents as the Agent shall determine in its
absolute discretion.
provided, however that, notwithstanding anything set forth in this
Section 2.05 to the contrary, in the event that the application of
any portion of prepayment required under this Section 2.05 would
cause the Borrower to incur a compensation obligation to any Bank
by reason of the prepayment of LIBOR Rate Loans on other than the
last day of an Interest Period, so long as no Event of Default has
occurred and is continuing (I) the Borrower may deposit such amount
with the Agent and direct the Agent to invest such amounts in short
term investments offered by the Agent and agreed to by the Borrower
and the Agent and held in the name of the Agent for the benefit of
the Borrower for such period as is necessary to avoid such
obligation but in no case maturing past the last day of the
Interest Period in question and (II) the Agent shall apply such
invested amount together with all interest earned thereon to the
repayment of the Revolving Credit Advances no later than on the
last day of such Interest Period; provided, further, that, upon the
occurrence and continuation of an Event of Default, the Agent may,
upon the request of the Majority Banks, cause any amount so
invested to be applied to the Obligations in such manner as the
Majority Banks shall direct the Agent notwithstanding any penalty
arising under this Agreement.
2.11 Amendment to Section 2.06. Section 2.06 shall be
deleted in its entirety and the following shall be substituted in
lieu thereof:
SECTION 2.06 Interest. (a) Pre-Default Interest Rate. The
Borrower shall pay interest on the unpaid principal amount of the
Revolving Credit Advances outstanding at the close of each day
until such principal amount shall be paid in full at the following
times and rates per annum (each of such rates being an "Interest
Rate"):
(i) Prime Rate Loans. During such periods as such Revolving
Credit Advances are a Prime Rate Loan, a rate per annum equal at
all times to the sum of the Prime Rate plus the Prime Rate Margin
in effect from time to time from and after the Amendment Effective
Date to the
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Termination Date. Each change in the Prime Rate shall bereflected
in the foregoing interest rates as of the effective date of such
change. Except as otherwise specifically provided herein, all
interest due hereunder will be payable in arrears, on the first day
of each calendar month herein.
(ii) LIBOR Rate Loans. During such periods as such Revolving
Credit Advances are a LIBOR Rate Loan, a rate per annum equal at
all times during each Interest Period for such Loan to the sum of
the LIBOR Rate for such Interest Period for such Loan plus the
LIBOR Rate Margin in effect at the time of the making of such Loan,
payable (x) on the last day of such Interest Period and (y) if such
Interest Period has a duration of more than three (3) months, three
(3) months after the first day of such Interest Period and (z) on
the date such LIBOR Rate Loan shall be converted to a Prime Rate
Loan or paid in full (whether at maturity, by reason of
acceleration or otherwise).
(b) Interest Rate Margin Reduction.
(i) Conditions. Each of the Prime Rate Margin and the LIBOR
Margin shall be reduced in accordance with clause (b)(ii) below;
provided, however, that each of the following conditions shall have
been concurrently met:
(A) no Default shall have occurred and be
continuing;
(B) the Agent shall have received the financial
statements required to be delivered pursuant to Section 8(iii) of
the Riser Guaranty (x) for Fiscal Years 1993 and 1994, with respect
to any reduction to be effective October 1, 1994, and (y) for
Fiscal Years 1993, 1994, and 1995, with respect to any reduction to
be effective October 1, 1995; and
(C) on or after (I) the last day of Fiscal Year
1994 (the "1994 Determination Date") or (II) the last day of Fiscal
Year 1995 (the "1995 Determination Date"), as applicable, the Agent
shall have received a certificate, in a form reasonably
satisfactory to the Agent, certifying that all of the conditions
required for a reduction in the Prime Rate Margin or the LIBOR Rate
Margin, as the case may be, shall have been satisfied as of the
applicable Determination Date;
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(ii) Calculation of Reduction
(A) For the period commencing on October 1, 1994 and ending
on the earlier of the occurrence of an Event of Default or
September 30, 1995, (a) if the Cumulative Consolidated Net
Operating Cash Flow as of the 1994 Determination Date shall be
greater than Forty-Three Million Two Hundred Twenty-Eight Thousand
Dollars ($43,228,000), the Prime Rate Margin shall be one quarter
of one percent (1/4%) for Prime Rate Loans and the LIBOR Rate
Margin shall be two and one-half percent (2-1/2%) or (b) if the
Cumulative Consolidated Net Operating Cash Flow as of the 1994
Determination Date shall be greater than Fifty-Six Million Six
Hundred Twenty-Five Thousand Dollars ($56,625,000) the Prime Rate
Margin shall be zero percent (0%) and Interest shall be at the
Prime Rate for Prime Rate Loans and the LIBOR Rate Margin shall be
two and one-quarter percent (2-1/4%).
(B) For the period commencing on October 1, 1995 and ending
upon the occurrence of an Event of Default, (a) if the Cumulative
Consolidated Net Operating Cash Flow as of the 1995 Determination
Date shall be greater than Seventy-Four Million Six Hundred Fifty-
Nine Thousand Dollars ($74,659,000) but less than or equal to
Ninety-Six Million Seven Hundred Eighty-Seven Thousand Dollars
($96,787,000), the Prime Rate Margin shall be one quarter of one
percent (1/4%) for Prime Rate Loans and the LIBOR Rate Margin shall
be two and one-half percent (2-1/2%) or (b) if the Cumulative
Consolidated Net Operating Cash Flow as of the 1995 Determination
Date shall be greater than Ninety-Six Million Seven Hundred Eighty-
Seven Eighty-Seven Thousand Dollars ($96,787,000) the Prime Rate
Margin shall be zero percent (0%) and Interest shall be at the
Prime Rate for Prime Rate Loans and the LIBOR Rate Margin shall be
two and one-quarter percent (2-1/4%).
(c) Default Interest. If any Event of Default occurs, then,
from the date such Event of Default occurs until the
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effective date of a waiver of such Event of Default by the Bank, or
until all Obligations are paid and performed in full, the Borrower
will pay interest on the unpaid principal balance of the Revolving
Credit Advances at a per annum rate (the "Default Rate") of two
percent (2%) in excess of the otherwise applicable Interest Rate.
(d) Additional Interest on LIBOR Rate Loans. To the extent
that any Bank shall be required under regulations of the Board of
Governors of the Federal Reserve System to maintain reserves with
respect to liabilities or assets consisting of or including
Eurocurrency Liabilities, the Borrower shall pay to each such Bank
additional interest on the unpaid principal amount of each Loan of
such Bank during such periods as such Loan is a LIBOR Rate Loan,
from the date such Loan is advanced to the Borrower until the
principal amount of such Loan is paid in full or converted to a
Prime Rate Loan pursuant to Section 2.02(e), at an interest rate
per annum equal at all times to the remainder obtained by
subtracting (i) the LIBOR Rate for such Interest Period for such
LIBOR Rate Loan from (ii) the rate obtained by dividing such LIBOR
Rate by a percentage equal to one hundred percent (100%) minus the
Eurocurrency Reserve Percentage of such Bank for such Interest
Period, payable on each date on which interest is payable on such
LIBOR Rate Loan. A certificate as to the amount of such additional
interest shall be submitted to the Borrower and the Agent by such
Bank, and shall be conclusive and binding for all purposes, absent
manifest error.
(e) Interest Rate Determination.
(i) Agent Determination; Notice. The Agent shall determine the
LIBOR Rate in accordance with the definition of LIBOR Rate set
forth in Section 1.01. The Agent shall give prompt notice to the
Borrower and the Banks of the applicable interest rate determined
by the Agent for purposes of Section 2.06(a)(i) or (ii).
(ii) Failure of Borrower to Elect. If no Interest Period is
specified in any Notice of Borrowing or any Rate
Conversion/Continuation Request for any LIBOR Rate Loans comprising
a Borrowing, the Borrower shall be deemed to have selected an
Interest Period with a duration of one month. If the Borrower
shall not have given notice in accordance with Section 2.02(e) to
continue any LIBOR Rate Loans comprising a Borrowing into a
subsequent Interest Period (and shall not have
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<PAGE>
otherwise delivered a Rate Conversion/Continuation Request in
accordance with Section 2.02(e) to convert such Loans), such LIBOR
Rate Loans shall, at the end of the Interest Period applicable
thereto (unless repaid pursuant to the terms hereof), automatically
convert into Prime Rate Loans.
2.12 Amendment to Section 2.08. Section 2.08 shall be
deleted in its entirety and the following shall be substituted in
lieu thereof:
SECTION 2.08 Payment not on Business Day. Whenever any
payment hereunder or under this Agreement or under the Notes shall
be stated to be due on a day other than a Business Day, such
payment shall be made on the next succeeding Business Day, except,
that, if such extension would cause payment of interest on or
principal of LIBOR Rate Loans to be made in the next following
calendar month, such payment shall be made on the immediately
preceding Business Day. Any such extension or reduction of time
shall in such case be included in the computation of payment of
interest or commitment fee, as the case may be.
2.13 Amendment to Section 2.13. Section 2.13 shall be
amended by adding the following sentence as the last sentence of
such Section:
"Notwithstanding anything contained in this Section 2.13 to the
contrary, this Section 2.13 shall not apply to any change in law,
rule, regulation, policy or guideline causing an imposition or
increase of reserve requirements in respect of LIBOR Rate Loans
otherwise included in the Eurocurrency Reserve Percentage."
2.14 Amendment to Article II. Article II shall be
amended to include new Sections 2.14, 2.15, 2.16, 2.17, 2.18, 2.19,
2.20 and 2.21 as follows:
SECTION 2.14 Illegality. Notwithstanding any other
provision of this Agreement, if any Bank determines that any
applicable Law, or any change therein, or any change in the
interpretation or administration of any Law by any governmental
authority, central bank or comparable agency charged with the
interpretation or administration thereof, or compliance by such
Bank (or its lending office) with any request or directive (whether
or not having the force of law) of any such authority, central bank
or comparable agency, shall make it unlawful or impossible, or any
such governmental authority, central bank or agency asserts that it
is unlawful, for any Bank or its lending office to perform its
obligations hereunder to make LIBOR Rate Loans or to fund or
maintain LIBOR Rate Loans hereunder, then, upon notice to the Agent
and
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<PAGE>
the Borrower by such Bank: (i) the obligation of the Banks to make,
continue or to convert Loans into, LIBOR Rate Loans shall be
suspended until the Agent shall notify the Borrower and the Banks
that the circumstances causing such suspension no longer exist and
(ii) the Borrower shall immediately, or at such later date, if any,
as may thereafter be permitted by relevant Law, prepay in full the
then outstanding principal amount of all LIBOR Rate Loans of all
Banks, together with interest accrued thereon and any other amounts
payable to the Banks hereunder unless the Borrower, within five (5)
Business Days of notice from the Agent, converts all LIBOR Rate
Loans of all Banks then outstanding into Prime Rate Loans in
accordance with Section 2.02(e) as to which such circumstances do
not exist. Any such payment or Rate Conversion shall be subject to
the applicable prepayment indemnification provisions of this
Article II.
SECTION 2.15 Unavailability. Notwithstanding any other
provision in this Agreement, if at any time with respect to any
LIBOR Rate Loans:
(a) Inadequate Rate. Any Bank notifies the Agent that
the LIBOR Rate for any Interest Period for such LIBOR Rate Loans
will not adequately reflect the cost to such Bank of making,
funding or maintaining its LIBOR Rate Loans for such Interest
Period, the Agent shall promptly notify the Borrower and the Banks,
or
(b) Unavailable Quotations. The Agent determines
which determination shall be conclusive) that quotations of
interest rates for dollar deposits are not being provided in
the relevant amounts or for the relevant maturities to, or the
circumstances affecting the London interbank market of
deposits in Dollars make it impracticable to, determine the
LIBOR Rate, or
(c) Unavailable Deposits. Any Bank determines that
Dollar deposits of the relevant amount for the relevant Interest
Period are not available in the London interbank market of deposits
of Dollars for the purpose of funding the LIBOR Rate Loans,
then (i) each LIBOR Rate Loan will automatically, on the last day
of the then existing Interest Period therefor, convert into a Prime
Rate Loan and (ii) the obligation of the Banks to make or to
convert Loans into LIBOR Rate Loans shall be suspended until the
Agent shall notify the Borrower and the Banks that the
circumstances causing such suspension no longer exist.
SECTION 2.16 Funding Costs. The Borrower agrees to
indemnify each Bank against any loss actually incurred
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<PAGE>
relating in any way to its funding of any LIBOR Rate Loan paid
before its stated maturity (whether a prepayment or a payment
following any acceleration of maturity or otherwise) and to pay
that Bank, as liquidated damages for any such loss, an amount
(discounted to the present value in accordance with standard
financial practice at a rate equal to the Treasury Yield (as
defined below)) equal to interest computed on the principal payment
from the payment date to the respective stated maturities thereof
at a rate equal to the difference of the contract rate less the
treasury yield, all as determined by that Bank in its reasonable
discretion. For the purposes of this Section 2.16, "Treasury Yield"
means the annual yield on direct obligations of the United States
having a principal amount and maturity similar to that of the
principal being paid.
SECTION 2.17 Losses. If any payment of principal of or Rate
Conversion or Rate Continuation of, any LIBOR Rate Loan is made
other than on the last day of an Interest Period relating to such
Loan, as a result of a payment or Rate Conversion or Rate
Continuation pursuant to the provisions of Article II or
acceleration of the maturity of the Notes pursuant to Article VI or
for any other reason, the Borrower shall, upon demand by any Bank
(with a copy of such demand to the Agent), pay to the Agent for the
account of such Bank any amounts (discounted to the present value
in accordance with standard financial practice at a rate equal to
the Treasury Yield) required to compensate such Bank for any
additional losses, costs or expenses which it may actually and
reasonably incur as a result of such payment or Rate Conversion or
Rate Continuation, including, without limitation, any loss
(including loss of anticipated profits), cost or expense incurred
by reason of the liquidation or reemployment of deposits or other
funds acquired by such Bank to fund or maintain such Loan.
SECTION 2.18 Indemnification for Requests. Whenever the
Borrower (a) shall revoke any Notice of Borrowing or any Rate
Conversion/Continuation Request involving any LIBOR Rate Loan, (b)
shall for any other reason fail to borrow pursuant to any such
Request or otherwise comply therewith, (c) shall fail to fulfill,
on or before the date specified in any such request, the applicable
conditions set forth in Article III of this Agreement or (d) shall
fail to honor any prepayment notice, then, in each case on any
Bank's demand, the Borrower shall indemnify each Bank and the Agent
against any loss, cost or expense actually incurred by such Bank or
the Agent as a result of any such failure by the Borrower,
including, without limitation, any loss (including loss of
anticipated profits), cost or expense incurred by reason of the
liquidation or reemployment of deposits or other funds acquired by
such Bank or the Agent to fund the LIBOR Rate Loan to be made by
such
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<PAGE>
Bank or the Agent in connection with such request when such LIBOR
Rate Loan, as a result of such failure by the Borrower, is not made
on such date.
SECTION 2.19 Increased Costs. If, due to either (i) the
introduction of or any change (other than any change by way of
imposition or increase of reserve requirements in respect of LIBOR
Rate Loans otherwise included in the Eurocurrency Reserve
Percentage) in or in the interpretation of any Law or (ii) the
compliance with any guideline or request from any central bank or
other governmental authority (whether or not having the force of
Law), there shall be any increase in the cost to any Bank of
agreeing to make or making, funding or maintaining LIBOR Rate
Loans, then the Borrower shall from time to time, upon demand by
such Bank (with a copy of such demand to the Agent), pay to the
Agent for the account of such Bank additional amounts sufficient to
indemnify such Bank for such increased cost.
SECTION 2.20 Certificate for Indemnification. Each demand by
Agent or a Bank for payment pursuant to Sections 2.13, 2.15, 2.16,
2.17, 2.18 or 2.19 or any other request for indemnification under
this Agreement or any of the Loan Documents shall be accompanied by
a certificate setting forth the reason for the payment, the amount
to be paid, that such amount has or will be actually incurred by
the Agent or such Bank and the computations and assumptions in
determining the amount, which certificate shall be presumed to be
correct. In determining the amount of any such payment thereunder,
each Bank may use reasonable averaging and attribution methods.
SECTION 2.21 Assignment of Revolving Credit Commitments
under Certain Circumstances. In the event that any one Bank shall
(i) have a Eurocurrency Reserve Percentage which is higher than
each of the other Banks which are parties hereto causing the
Borrower to pay additional interest pursuant to Section 2.06(d) in
an amount which is greater than the amount the Borrower would have
been obligated to pay if such Bank were not a party hereto or (ii)
have delivered a notice pursuant to Section 2.15(a) or 2.19 which
notice shall either prohibit the Borrower from obtaining LIBOR Rate
Loans or shall cause the Borrower to be required to make additional
payments to such Bank, the Borrower shall have the right, but not
the obligation, at its own expense, upon notice to such Bank and
the Agent, to replace such Bank with an assignee (in accordance
with and subject to the restrictions contained in Section 8.10),
and such Bank hereby agrees to transfer and assign without recourse
(in accordance with and subject to the restrictions contained in
Section 8.10 all its interests, rights and obligations under this
Agreement to such assignee; provided, however, that (a) no such
assignment shall conflict
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with any Law and (b) the Borrower or such assignee, as the case may
be, shall pay to the affected Bank in immediately available funds
on the date of such assignment the principal of and interest
accrued to the date of payment on the Loans made by such Bank
hereunder and all other amounts accrued for such Bank's account or
owned to it hereunder, including, without limitation, any amounts
owing in respect of any indemnification or reimbursement obligation
under this Agreement.
2.15 Amendment to Section 5.02(b). Section 5.02(b) shall
be deleted in its entirety and the following shall be substituted
in lieu thereof:
(b) Indebtedness. The Borrower shall not create or suffer to
exist, or permit any of its Subsidiaries to create or suffer to
exist, any Indebtedness, liability or other obligation except (i)
Indebtedness secured by Liens or security interests permitted by
Section 5.02(a), (ii) the Subordinated Debentures, (iii) the
MetLife Indebtedness, so long as the aggregate principal amount of
such Indebtedness shall not at any time exceed Six Million Dollars
($6,000,000), (iv) the Fifth Third Indebtedness, so long as the
aggregate principal amount of such Indebtedness shall not at any
time exceed Four Hundred Eighty-Nine Thousand Three Hundred Sixty-
Eight and 92/100ths Dollars ($489,368.92), (v) the Indebtedness set
forth on Schedule 5.02(b), (vi) ordinary course trade payables,
(vii) Indebtedness evidenced by bankers' acceptances used by the
Borrower to pay its ordinary course trade payables, (viii) the
Store Construction Indebtedness, so long as the aggregate principal
amount of such Indebtedness shall not exceed Five Million Dollars
($5,000,000) per Fiscal Year in each of 1995, 1996, 1997 and 1998,
and (ix) the Seaway Development Indebtedness (as such term is
defined in the American Agreement).
2.16 Amendment to Section 3.02. Section 3.02 shall be
deleted in its entirety and the following shall be substituted in
lieu thereof:
SECTION 3.02. Additional Conditions Precedent. It shall
be an additional condition precedent to each Loan under this
Agreement, to each Rate Conversion or Rate Continuation and to the
issuance of each Letter of Credit that on the date of such Loan,
Rate Conversion, Rate Continuance or issuance, respectively, after
giving effect thereto:
(a) Continuing Representations. The following statements
shall be true and correct in all respects:
(i) the representations and warranties of each Loan Party
contained in the Loan Documents are
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correct on and as of the date of such Loan or issuance,
respectively, as though made on and as of such date,
(ii) the Revolving Credit Availability of the
Eligible Collateral is no less than the sum of the aggregate
principal amount of the Revolving Credit Advances to be outstanding
plus the aggregate of the Letter of Credit Face Amount of all
outstanding Letters of Credit, after giving effect to such
Revolving Credit Advance, Rate Continuation, Rate Conversion or
issuance, respectively, and
(iii) no event has occurred and is continuing, or
would result from such Loan, Rate Continuation, Rate Conversion or
issuance, respectively, that constitutes a Default.
The giving of each Notice of Borrowing and the receipt of the
proceeds of each Loan, the giving of a Rate Continuation/Rate
Conversion Notice and the effectiveness of the Rate Conversion or
Rate Continuation referred to therein, and the making of each
request for issuance of a Letter of Credit and the issuance of such
Letter of Credit shall each constitute a representation and
warranty by the Borrower that each of the foregoing statements
shall be true as of the date of such Loan, Rate Conversion, Rate
Continuation or issuance, respectively.
(b) Additional Information. The Agent shall have
received such other instruments, information, approvals, opinions
or documents as the Agent may reasonably request.
2.17 Amendment to Section 5.02(c). Section 5.02(c) shall be
deleted in its entirety and the following shall be substituted in
lieu thereof:
(c) Sales, Etc. of Assets. The Borrower shall not sell,
lease, transfer or otherwise dispose of, or permit any of its
Subsidiaries to sell, lease, transfer, or otherwise dispose of, any
of its assets, except (i) sales of inventory in the ordinary course
of business, (ii) so long as no Default has occurred hereunder,
with respect to assets other than Inventory sold in the ordinary
course of business, sales or transfers permitted by Section 7(u) of
the Riser Guaranty so long as all the proceeds of any sales,
leases, transfers and other dispositions of assets under this
subsection (ii) (other than sales of Inventory in the ordinary
course of business) shall be applied in accordance with Section
2.05 or (iii) American may sell either or both of Building No. 5
and the Cash-n-Carry Building (as such term is defined in the
American Agreement) so long as all the proceeds of any such sales
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shall be applied in accordance with Section 2.05 of the American
Agreement.
2.18 Amendment to Section 5.02(l). Section 5.02(l) shall be
deleted in its entirety and the following shall be substituted in
lieu thereof:
(c) Sale and Leaseback. The Borrower shall not enter into,
or permit any of its Subsidiaries to enter into, any transaction in
which the Borrower or any of its Subsidiaries sells property owned
by the Borrower or any of its Subsidiaries and subsequently leases
such property from the purchaser thereof (i) unless such transfer
is in accordance with Section 5.02(c) hereof, and (x) the selling
entity has received consideration in an amount at least equal to
the fair market value of the assets leased and (y) the Agent has
received prior written notice of such transfer and its proposed
terms, or (ii) except in connection with the Store Construction
Indebtedness.
2.19 Amendment to Section 5.02(m). Section 5.02(m) shall
be deleted in its entirety and the following shall be substituted
in lieu thereof:
(m) Issuance of Transfer of Stock. Except with respect to
Shares issued as of the date hereof as identified on Schedule
4.01(h) hereof and upon conversion of any Subordinated Debenture
convertible into Shares, the Borrower shall not issue or permit to
be transferred any of the Shares of capital stock.
2.20 Amendment to Section 8.25. Section 8.25 shall be
deleted in its entirety and the following shall be substituted in
lieu thereof:
SECTION 8.25 Commitments. The Revolving Credit Commitment
and the Total Commitment of each Bank shall be as set forth below:
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<TABLE>
<CAPTION>
BANK REVOLVLING BANK'S
CREDIT TOTAL
COMMITMENT COMMITMENT
<S> <C> <C>
Society National $ 6,400,000 $ 6,400,000
Bank
National City $ 3,728,000 $ 3,728,000
Bank
NBD Bank, N.A. $ 2,475,331 $ 2,475,331
Star Bank, N.A. $ 3,396,668 $ 3,396,668
Total of
Commitments $16,000,001 $16,000,001
</TABLE>
SECTION 3. REPRESENTATIONS AND WARRANTIES.
The Borrower hereby represents and warrants to the Banks and the
Agent as follows:
3.1 The Amendment. This Amendment has been duly and validly
executed by an authorized executive officer of the Borrower and
constitutes the legal, valid and binding obligation of the Borrower
enforceable against the Borrower in accordance with its terms. The
Credit Agreement, as amended by this Amendment, remains in full
force and effect and remains the valid and binding obligation of
the Borrower enforceable against the Borrower in accordance with
its terms. The Borrower hereby ratifies and confirms the
Credit Agreement as amended by this Amendment.
3.2 Nonwaiver. The execution, delivery, performance and
effectiveness of this Amendment shall not operate nor be deemed to
be nor construed as a waiver (i) of any right, power or remedy of
the Banks or the Agent under the Credit Agreement, nor (ii) of any
term, provision, representation, warranty or covenant contained in
the Credit Agreement or any Other documentation executed in
connection therewith. Further, none of the provisions of this
Amendment shall constitute, be deemed to be or construed as, a
waiver of any Default or Event of Default under the Credit
Agreement as amended by this Amendment.
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3.3 Reference to and Effect on the Credit Agreement. Upon the
Effectiveness of this Amendment, each reference in the Credit
Agreement to "this Agreement", "hereunder", "hereof", "herein", or
words of like import shall mean and be a reference to the Credit
Agreement, as amended by the First Amendment, the Second Amendment
and this Amendment and each reference to the Credit Agreement in
any other document, instrument or agreement executed and/or
delivered in connection with the Credit Agreement shall mean
and be a reference to the Credit Agreement, as amended by the First
Amendment, the Second Amendment and this Amendment.
SECTION 4. CONDITIONS PRECEDENT TO EFFECTIVENESS
OF THIS AMENDMENT NO. 3.
In addition to all of the other conditions and agreements set
forth herein, the effectiveness of this Amendment is subject to the
following conditions precedent:
4.1 The Amendment. The Banks and the Agent shall have received
this Amendment No. 3 to Amended and Restated Credit Agreement,
executed and delivered by a duly authorized officer of the
Borrower.
4.2 Other Amendments. The Banks and the Agent shall have
received each of Amendment No. 3 to Amended and Restated Guaranty
Agreement and Amendment No. 2 to Credit Agreement in respect of the
American Agreement, each executed and delivered by a duly
authorized officer of Riser Foods, Inc., and all of the conditions
precedent to such Amendment shall have been satisfied.
4.3 Acknowledgement of Guarantors. The Banks and the Agent
shall have received the Acknowledgement of Guarantors attached to
this Amendment, executed and delivered by a duly authorized officer
of each of the Guarantors of the indebtedness of the Borrower to
the Banks and the Agent.
4.4 Borrower's Certificate. The Banks and the Agent shall have
received a certificate, in form and substance satisfactory to the
Agent, executed for an on behalf of the Borrower by the Chief
Executive Officer and the Secretary of the Borrower and dated as of
the date of this Amendment, certifying (i) the Director's
Resolutions of the Borrower authorizing this Amendment, and each
document or other instrument executed in connection with the
Amendment, (ii) the names and signatures of the officers of the
Borrower, and (iii) compliance by the Borrower with all
representations, warranties, covenants and conditions under the
Credit Agreement as amended by this Amendment.
4.5 Other Documents. The Banks and the Agent shall have
received each additional document, instrument or piece of
information reasonably requested by the Agent, including, without
limitation, any financing statements as may be necessary to
continue the perfection of the security interests created by the
Security Agreements.
SECTION 5. MISCELLANEOUS.
5.1 Governing Law. This Amendment shall be governed by and
construed in accordance with the laws of the State of Ohio.
5.2 Severability. In the event any provision of this Amendment
should be invalid, the validity of the other provisions hereof and
of the Credit Agreement shall not be affected thereby.
5.3 Counterparts. This Amendment may be executed in one or more
counterparts, each of which, when taken together, shall constitute
but one and the same agreement.
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IN WITNESS WHEREOF, the Borrower has caused this
Amendment No. 3 to Amended and Restated Credit Agreement to be duly
executed and delivered by its duly authorized officer as of the
date first above written.
RINI-REGO SUPERMARKETS, INC.
(formerly known as Fisher Foods,
Inc.)
By:
Title:
180\22687EBD.120
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ACCEPTED AND AGREED as of
the date and year first above written by:
SOCIETY NATIONAL BANK, as a NBD BANK,
Bank and as Agent as a Bank
By: By:
Title: Title:
NATIONAL CITY BANK, STAR BANK, N.A., as a
as a Bank Bank
By: By:
Title: Title:
180\22687EBD.120
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ACKNOWLEDGEMENT OF GUARANTORS
Each of the undersigned, RISER FOODS, INC., SEAWAY FOOD SERVICE,
INC. (formerly known as American Seaway Foods, Inc.) FISHER
PROPERTIES, INC., and AMERICAN SEAWAY FOODS, INC. (formerly known
as Heritage Wholesalers, Inc.), each of which being a guarantor of
indebtedness of the Borrower to the Banks and the Agent, hereby
acknowledges and agrees to the terms of theforegoing Amendment No.
3 to Amended and Restated Credit Agreement. Each of
the undersigned represents and warrants to the Banks and the Agent
that the respective Amended and Restated Guaranty Agreements (as
amended), executed and delivered by each of the undersigned, each
dated as of May 27, 1993, remain the valid and binding obligations
of each of the undersigned, respectively, enforceable against it in
accordance with their terms.
RISER FOODS, INC.
By:
Title:
SEAWAY FOOD SERVICE, INC. (formerly
known as American Seaway Foods, Inc.)
By:
Title:
AMERICAN SEAWAY FOODS, INC. (formerly
known as Heritage Wholesalers, Inc.)
By:
Title:
FISHER PROPERTIES, INC.
By:
Title:
Executed: April , 1995
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EXHIBIT 10.60
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<PAGE> EXECUTION COPY
AMENDMENT NO. 2
TO
AMENDED AND RESTATED
CREDIT AGREEMENT
This Amendment No. 2 to Amended and Restated Credit
Agreement (this "Amendment"), made as of the 28th day of April,
1995, between AMERICAN SEAWAY FOODS, INC. (formerly known as
Heritage Wholesalers, Inc.), an Ohio corporation (herein the
"Borrower"), the Banks (as hereinafter defined) and SOCIETY
NATIONAL BANK, as agent for the Banks (in such capacity, the
"Agent"),
WITNESSETH:
WHEREAS, the Borrower has been extended certain financial
accommodations pursuant to that certain Amended and Restated Credit
Agreement, dated as of May 27, 1993 (as amended pursuant to
Amendment No. 1 to Amended and Restated Credit Agreement, dated as
of October 6, 1994 (the "First Amendment"), as so amended the
"Credit Agreement"), among the Borrower, the financial institutions
which are a party thereto (the "Banks") and the Agent;
WHEREAS, the Borrower, the Banks and the Agent desire to
amend the Credit Agreement as set forth herein; and
WHEREAS, the Banks which are the signatories hereto
constitute all of the Banks for the purposes of amending the Credit
Agreement pursuant to Section 8.21 thereof.
NOW THEREFORE, in consideration of the mutual promises
and agreements contained herein and other good and valuable
consideration, the receipt and adequacy of which are hereby
acknowledged, the Borrower, the Banks and the Agent do hereby agree
as follows:
SECTION I. DEFINED TERMS.
Each defined term used herein and not otherwise defined
herein shall have the meaning ascribed to such term in the Credit
Agreement.
SECTION II. AMENDMENTS TO THE CREDIT AGREEMENT.
The Borrower, the Banks and the Agent hereby agree that
the Credit Agreement shall be amended, effective as of the date
hereof and subject to the terms and conditions hereof, as follows:
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2.1 A. Amendment to Section 1.01. The following
definitions found in Section 1.01 shall each be amended in its
entirety to read as follows:
"Business Day" means a day of the year on which banks are not
required or authorized to close in Cleveland, Ohio and, if the
applicable Business Day relates to any LIBOR Rate Loans, a day of
the year on which dealings in dollar deposits are carried on in the
London interbank market and banks are open for business in London.
"Collateral" means all property and assets of the Borrower,
including without limitation, the Collateral described in the
Patent Agreement of the Borrower, and in Section 1 of the Security
Agreement of the Borrower and in Section 1 of the Motor Vehicle
Security Agreement of the Borrower, and the Real Property and
Leaseholds described in the Mortgages of the Borrower but excluding
the property and assets financed pursuant to the Store Construction
Indebtedness.
"Loans" means, collectively, all loans and advances provided
for in Article II hereof, including, without limitation, the
Revolving Credit Advances consisting of LIBOR Rate Loans and Prime
Rate Loans.
"Permitted Liens" means (i) Existing Liens; (ii) the MetLife
Liens; (iii) the Fifth Third Liens; (iv) Liens for taxes not yet
payable or Liens for taxes, assessments or governmental charges or
levies to the extent not required to be paid by the Borrower or any
of its Subsidiaries under Section 5.01(g) hereof; (v) Liens in
favor of the Banks; (vi) Liens upon Equipment granted in connection
with the acquisition of such Equipment by the Borrower after the
date hereof (including, without limitation, pursuant to capital
leases); provided, however, that the Liens described in (vi) hereof
shall be permitted only if (a) the cost of each item of equipment
so acquired constitutes a Capital Expenditure permitted by Section
7(t) of the Guaranty Agreement of Riser, (b) the Indebtedness
incurred to finance each such acquisition is permitted by Section
5.02(b), (c) each such Lien attaches only to the Equipment acquired
with the Indebtedness secured thereby, and (d) the principal amount
of the indebtedness secured by any item of equipment shall not
exceed one hundred percent (100%) of the purchase price thereof;
(vii) reservations, exceptions, encroachments, easements, rights of
way, covenants, conditions, restrictions, leases and other similar
title exceptions or encumbrances affecting Borrower's or any
Subsidiary's real property; provided, however, such Liens described
in (vii) hereof shall be permitted only so long as they do not in
the aggregate materially detract from the value of said properties
or materially interfere with
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their use in the ordinary conduct of the Borrower's or any
Subsidiary's business; (viii) pledges or deposits under worker's
compensation, unemployment insurance, social security and other
similar laws; (ix) liens relating to statutory obligations with
respect to surety and appeal bonds, performance bonds and other
obligations of a like nature incurred in the ordinary course of
business; (x) unperfected liens imposed by law against Borrower's
or any Subsidiary's real property and equipment only, such as
materialmen's mechanic's carrier's and repairmen's liens and other
similar liens, arising in the ordinary course of business securing
obligations which are not overdue for a period of more than thirty
(30) days; provided, however, no Lien in favor of the PBGC shall in
any event be a "Permitted Lien"; provided, further, none of the
liens, security interests or other encumbrances listed in clauses
(i) through (x) above shall, in any event, constitute a "Permitted
Lien" on and after the commencement in respect hereof of any
enforcement, collection, execution, levy or foreclosure
proceeding, unless (a) any such enforcement, collection, execution,
levy or foreclosure proceeding is with respect to Equipment having
a fair market value of less than Fifteen Thousand Dollars
($15,000.00), (b) the dollar value of such claim giving rise to any
such enforcement, collection, execution, levy or foreclosure
proceeding is less than Five Thousand Dollars ($5,000.00) and (c)
the aggregate amount of all such claims shall in no event exceed
Twenty Thousand Dollars ($20,000.00); and (xi) the Building
Acquisition Liens ; provided, however, that the Liens described in
(xi) hereof shall be permitted only if (a) the Indebtedness
incurred to finance each such acquisition is permitted by Section
5.02(b), (b) each such Lien attaches only to the property acquired
with the Indebtedness secured thereby, and (c) the principal amount
of the indebtedness secured by such property shall not exceed one
hundred percent (100%) of the purchase price thereof.
"Termination Date" means the date upon which the Revolving
Credit Commitment of each of the Banks terminates which shall be
July 6, 1998 or such earlier date pursuant to Article VI.
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2.2 A. Amendment to Section 1.01. Section 1.01 shall be
amended to include the following definitions in the appropriate
alphabetical order:
"Borrowing" means a Revolving Credit Borrowing or a Term
Borrowing.
"Building Acquisition Indebtedness" means the Indebtedness
incurred by the Borrower in connection with the acquisition by the
Borrower of the Building No. 5 and the Cash-n-Carry Building.
"Building Acquisition Liens" means the Liens securing any
Building Acquisition Indebtedness.
"Building No. 5 and the Cash-n-Carry Building" means the real
property and improvements located at 22801 Aurora Road, Bedford
Heights, Ohio and 3900 Woodland Avenue, Cleveland, Ohio,
respectively.
"Eurocurrency Liabilities" has the meaning assigned to that
term in Regulation D of the Board of Governors of the Federal
Reserve System, as in effect from time to time.
"Eurocurrency Reserve Percentage" of any Bank for the Interest
Period for any LIBOR Rate Loan means the reserve percentage
applicable during such Interest Period (or if more than one such
percentage shall be so applicable, the daily average of such
percentages for those days in such Interest Period during which any
such percentage shall be so applicable) under regulations issued
from time to time by the Board of Governors of the Federal Reserve
System (or any successor) for determining the maximum reserve
requirement (including, without limitation, any emergency,
supplemental or other marginal reserve requirement) for such Bank
with respect to liabilities or assets consisting of or including
Eurocurrency Liabilities having a term equal to such Interest
Period.
"Interest Period" means, for each of the LIBOR Rate Loans
comprising a Borrowing, the period commencing on the date of such
Loans or the date of the Rate Conversion or Rate Continuation of
any Loans into such Loans and ending on the numerically
corresponding day of the period selected by the Borrower pursuant
to the provisions hereof and each subsequent period commencing on
the last day of the immediately preceding Interest Period in
respect of such Loans and ending on the last day of the period
selected by the Borrower pursuant to the provisions hereof. The
duration of each such Interest
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Period shall be one, two, three or six months, in each case as the
Borrower may select, upon delivery to the Agent of a Notice of
Borrowing therefor in accordance with Section 2.02(a) hereof;
provided, however, that:
(a)Interest Periods for Loans comprising part of the same Borrowing
shall be of the same duration;
(b)with respect to LIBOR Rate Loans comprising any Borrowings, no
Interest Period may end on a date later than the Termination Date;
(c)whenever the last day of any Interest Period would otherwise
occur on a day other than a Business Day, the last day of such
Interest Period shall be extended to occur on the next succeeding
Business Day; provided, however, that if such extension would cause
the last day of such Interest Period to occur in the next following
calendar month, the last day of such Interest Period shall occur on
the immediately preceding Business Day;
(d)if the Interest Period commences on a Business Day for which
there is no numerical equivalent in the calendar month in which the
Interest Period is to end, such Interest Period shall end on the
last Business Day of that calendar month; and
(e)the Borrower may not select any Interest Period with respect to
a Borrowing comprised of Revolving Credit Advances after the date
of any mandatory reduction specified in Section 2.01(e) or 2.05 or
2.04(a), after giving effect to such selection, the aggregate
unpaid principal amount of any then outstanding Prime Rate Loans
taken together with the principal amount of any then outstanding
LIBOR Rate Loans having Interest Periods ending on or prior to the
date of such mandatory reduction shall be at least equal to the
principal amount of the Revolving Credit Advances due and payable
on or prior to such date.
(f)the Borrower may not select any Interest Period with respect to
a Borrowing comprised of Term Loans ending after the date of any
payment required by the Term Notes, if after giving effect to such
selection, the aggregate unpaid principal amount of any then
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outstanding Prime Rate Loans taken together with the principal
amount of any then outstanding LIBOR Rate Loans having Interest
Periods ending on or prior to the date of such payment shall be at
least equal to the principal amount of the amounts due and payable
on or prior to such date.
"Law" means any federal, state, local or foreign law,
ordinance or regulation or any order, case precedent, ruling,
directive, judgment, injunction, award or decree or request having
the force of law or any other requirement of any governmental or
regulatory body, court, tribunal or arbitrator.
"LIBOR Rate" means, with respect to any LIBOR Rate Loan for
any Interest Period, an interest rate per annum (rounded upward to
the nearest 1/16th of 1%) equal to the average of the per annum
rates at which deposits in immediately available funds in United
States dollars approximately equal in principal amount to the
Agent's portion of such Borrowing and for a maturity comparable to
the Interest Period are offered to the Reference Bank by prime
banks in any Eurodollar market reasonably selected by the Reference
Bank, determined as of 4:00 p.m. London time (or as soon thereafter
as practicable), two (2) Business Days prior to the beginning of
the relevant Interest Period pertaining to a LIBOR Rate Loan
thereunder.
"LIBOR Rate Loan" means a Loan which bears interest at the
LIBOR Rate plus the LIBOR Rate Margin.
"LIBOR Rate Margin" means two and three-quarters percent (2-
3/4%) per annum, subject to adjustment pursuant to Section 2.06(b).
"Prime Rate Loan" means a Loan which bears interest at the
Prime Rate plus the Prime Rate Margin.
"Prime Rate Margin" means one-half percent (1/2%) per annum,
subject to adjustment pursuant to Section 2.06(b)
"Rate Continuation" means a continuation of LIBOR Rate Loans
having a particular Interest Period as LIBOR Rate Loans having an
Interest Period of the same duration pursuant to Section 2.02(d).
"Rate Conversion" refers to a conversion pursuant to Section
2.02(d) of Prime Rate Loans into LIBOR Rate Loans or LIBOR Rate
Loans into Prime Rate Loans and, with
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respect to LIBOR Rate Loans, a conversion of LIBOR Rate Loans from
one permissible Interest Period to another permissible Interest
Period.
"Rate Conversion/Continuation Request" means a request for
Rate Conversion or Rate Continuation and made pursuant to Section
2.02(d).
"Reference Bank" means the Cayman Islands branch office of
Society National Bank.
"Revolving Credit Borrowing" has the meaning specified in
Section 2.01(c) hereof.
"Term Borrowing" has the meaning specified in Section 2.01(c)
hereof.
2.3 Amendment to Credit Agreement. Each reference to
the word "law" in the Credit Agreement shall be amended to read
"Law" as defined in Section 1.01.
2.4 Amendment to Add Exhibits. The Credit Agreement is
hereby amended to add Attachment 1 to this Amendment as Exhibit B
to the Credit Agreement (Form of Notice of Borrowing) and
Attachment 2 to this Agreement as Exhibit C to the Credit Agreement
(Form of Rate Conversion/Continuation Request).
2.5 Amendment to Section 2.01(b). Section 2.01(b) shall
be deleted in its entirety and the following shall be substituted
in lieu thereof:
(b) Term Loan Advances. Each Bank severally agrees, upon the
terms and conditions set forth in this Agreement, on the Amendment
Effective Date to make Term Loans to the Borrower (each a "Term
Loan") in the amount of such Bank's Term Loan Commitment.
2.6 Amendment to Section 2.01(c). Section 2.01(c) shall
be deleted in its entirety and the following shall be substituted
in lieu thereof:
(c) Borrowings. Each borrowing of Revolving Credit Advances
under this Article II (a "Revolving Credit Borrowing") shall
consist of a group of Revolving Credit Advances consisting entirely
of Prime Rate Loans or LIBOR Rate Loans, made by the Banks ratably
in accordance with their Pro Rata Share, on the same date, and, in
the case of LIBOR Rate Loans, as to which a single Interest Period
is in effect. Any group of Revolving Credit Advances made by the
Banks having different interests rates or having a different
Interest Period (regardless of whether such Interest Period
commences on the same date as
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another Interest Period), or made on a different date shall be
considered to comprise a different Revolving Credit Borrowing.
Each borrowing of Term Loans under this Article II (a "Term
Borrowing") shall consist of a group of Term Loans consisting
entirely of Prime Rate Loans or LIBOR Rate Loans, made by the Banks
ratably in accordance with their Pro Rata Share, on the same date,
and, in the case of LIBOR Rate Loans, as to which a single Interest
Period is in effect. Any group of Term Loans made by the Banks
having different interests rates or having a different Interest
Period (regardless of whether such Interest Period commences on the
same date as another Interest Period), or made on a different date
shall be considered to comprise a different Term Borrowing.
2.7 Amendment to Section 2.01(f). Section 2.01(h) shall
be deleted in its entirety.
2.8 Amendment to Section 2.02(a). Section 2.02(a) shall
be deleted in its entirety and the following shall be substituted
in lieu thereof:
(a) Borrowings; Settlement.
(i) Minimum Borrowing Amounts. Each Borrowing comprised
of LIBOR Rate Loans shall be in an aggregate amount not less than
Three Million Dollars ($3,000,000) or multiples of One Million
Dollars ($1,000,000) in excess thereof. The Borrower shall be
entitled to have more than one Borrowing outstanding at one time;
provided, however, that, unless the Agent and the Banks shall
otherwise agree in writing, the Borrower shall not be entitled to
request any Revolving Credit Borrowing or Term Borrowing which
would result in any Bank's having an aggregate of more than ten
(10) LIBOR Rate Loans outstanding at any one time.
(ii) Notice of Borrowing. Revolving Credit Advances or
Term Loans comprising a Borrowing shall be made upon notice (a
"Notice of Borrowing") given by the Borrower to the Agent (i) not
later than 2:00 p.m. (Cleveland, Ohio time) on the Business Day
which is the requested date of a proposed Borrowing comprised of
Prime Rate Loans and (ii) not later than 12:00 noon (Cleveland,
Ohio time) three (3) Business Days prior to the requested date of
a proposed Borrowing comprised of LIBOR Rate Loans. Each Notice of
Borrowing for a Borrowing comprised of LIBOR Rate Loans shall be
substantially in the form of Exhibit B hereto and shall specify
therein (A) the requested date of the Borrowing, (B) whether such
Borrowing is to be a
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Revolving Credit Borrowing or a Term Borrowing, (C) that such
Borrowing is to be comprised of LIBOR Rate Loans, (D) with respect
to a Revolving Credit Borrowing, the name of the bank and the
account number to which such funds are to be disbursed, (E)
aggregate amount of such Revolving Credit Advances or Term Loans
comprising such Borrowing and (F) the initial Interest Period for
such LIBOR Rate Loans comprising such Borrowing. Each Notice of
Borrowing shall be irrevocable and binding on the Borrower and
subject to the indemnification provisions of this Article II.
(iii) Settlement. With respect to Revolving Credit
Advances, each Bank irrevocably agrees to settle with the Agent
forthwith upon each request of the Agent at such time and such
frequency as the Agent in its sole discretion may determine, but in
any event not less frequently than weekly, on the net average daily
amount of Revolving Credit Advances outstanding during the period
since the last such settlement such that if such average daily
amount is greater than the average daily amount for the preceding
such period, each Bank shall pay to the Agent its Pro-Rata Share of
such increase and if such average daily amount is less than the
average daily amount for the preceding such period, the Agent will
remit to each Bank its Pro-Rata Share of such decrease.
2.9 Amendment to Section 2.02. Section 2.02 shall be
amended to add the following as new Sections 2.02(g):
(g) Rate Conversion and Rate Continuation of Revolving Credit
Advances. The Borrower shall have the right, upon request
delivered by the Borrower to the Agent (i) not later than 12:00
noon (Cleveland time) on the Business Day that Borrower desires to
convert any LIBOR Rate Loans comprising a Borrowing into Prime Rate
Loans so as to comprise a Borrowing, (ii) not later than 12:00 noon
(Cleveland time) three (3) Business Days prior to a Rate
Conversion, to convert any Prime Rate Loans comprising a Borrowing
into LIBOR Rate Loans for a given Interest Period so as to comprise
a Borrowing, (iii) not later than 12:00 noon (Cleveland time) three
(3) Business Days prior to a Rate Continuation, to continue any
LIBOR Rate Loans comprising a given Borrowing as LIBOR Rate Loans
for an additional Interest Period of the same duration so as to
comprise a Borrowing and (iv) not later than 12:00 noon (Cleveland
time) three (3) Business Days prior to a Rate Conversion, to
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convert any LIBOR Rate Loans having a particular Interest Period
comprising a Borrowing into LIBOR Rate Loans having a different
permissible Interest Period so as to comprise a Borrowing;
provided, however, that each such Rate Conversion or Rate
Continuation shall be subject to the following:
(A) each Rate Conversion or Rate Continuation shall be made among
the Banks based upon each Bank's Pro Rata Share of such converted
or continued Revolving Credit Advances comprising a Borrowing,
(B) if less than all the outstanding principal amount of the Loans
comprising a Borrowing is converted or continued, the aggregate
principal amount of such Loans converted or continued shall be in
the case of LIBOR Rate Loans, not less than Three Million Dollars
($3,000,000), or a multiple of One Million Dollars ($1,000,000) in
excess thereof,
(C) each Rate Conversion or Rate Continuation shall be effected by
each Bank by applying the proceeds of the Loans resulting from such
Rate Conversion or Rate Continuation to the Loans of such Bank
being converted or continued, as the case may be, and the accrued
interest on any such Loans (or portion thereof) being converted or
continued shall be paid to the Agent on behalf of each Bank by the
Borrower at the time of such Rate Conversion or Rate Continuation,
(D) LIBOR Rate Loans shall not be converted or continued at a time
other than the end of an Interest Period applicable thereto unless
the Borrower shall pay, upon demand, any amounts due to the Banks
pursuant to this Article II,
(E) Loans comprising a Borrowing may not be converted into or
continued as LIBOR Rate Loans less than one month prior to the
Termination Date,
(F) Loans comprising a Borrowing that cannot be converted into or
continued as LIBOR Rate Loans by reason of clause (E) shall be
automatically converted at the end of the
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Interest Period in effect for such LIBOR Rate Loans into Prime Rate
Loans comprising a Borrowing,
(G) with respect to Revolving Credit Borrowings, no Interest
Period can be selected in connection with any Rate Conversion or
Rate Continuation ending after the date of any mandatory reduction
set forth in this Agreement unless, after giving effect to such
selection, the aggregate unpaid principal amount of any then
outstanding Revolving Credit Advances which are Prime Rate Loans
taken together with the principal amount of any then outstanding
Revolving Credit Advances which are LIBOR Rate Loans having
Interest Periods ending on or prior to the date of such mandatory
reduction shall be at least equal to the principal amount of the
Revolving Credit Advance due and payable on or prior to such date.
(H) with respect to Term Borrowings, no Interest Period can be
selected in connection with any Rate Conversion or Rate
Continuation ending after the date of any payment required by the
Term Notes unless, after giving effect to such selection, the
aggregate unpaid principal amount of any then outstanding Term
Loans which are Prime Rate Loans taken together with the principal
amount of any then outstanding Term Loans which are LIBOR Rate
Loans having Interest Periods ending on or prior to the date of
such required payment shall be at least equal to the principal
amount of the aggregate amount of the payments due and payable on
or prior to such date as set forth in the Term Notes.
Each such request for a conversion or continuation (a "Rate
Conversion/Continuation Request") in respect of Loans comprising a
Borrowing shall be transmitted by the Borrower to the Agent
substantially in the form of Exhibit C hereto and shall specify
(A) the identity and amount of the Loans comprising a Borrowing
that the Borrower requests be converted or continued, (B) whether
such Borrowing is a Revolving Credit Borrowing or a Term Borrowing,
(C) whether the Loans comprising such Borrowing shall be converted
into or continued as LIBOR Rate Loans or Prime Rate Loans, (D) if
such notice requests a Rate Conversion, the date of the Rate
Conversion (which shall be a Business Day) and (E) in the case of
Loans comprising a Borrowing being converted into
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or continued as LIBOR Rate Loans, the Interest Period for such
LIBOR Rate Loans. The Agent shall promptly deliver on the day
received a copy of each such Conversion/Continuation Request to the
Banks.
2.10 Amendment to Section 2.04(b). Section 2.04(b) shall
be deleted in its entirety and the following shall be substituted
in lieu thereof:
(b) Application.
(i) Except as otherwise provided in (a) above, the Borrower
irrevocably authorizes the Agent to apply such funds received by
the Agent (A) first to the Pro Rata Share of the Prime Rate Loans
made by the Banks as part of the same Borrowing ratably according
to the then outstanding principal amounts of such Prime Rate Loans
and (B) second to the Pro Rata Share of the LIBOR Rate Loans made
by the Banks as part of the same Borrowing ratably according to the
then outstanding principal amounts of such LIBOR Rate Loans.
(ii) The Borrower shall also repay on the Termination Date the
aggregate principal amount of the Revolving Credit Advances then
outstanding, in each case with accrued interest to the date of such
repayment on the amount repaid.
provided, however that, notwithstanding anything in this Section
2.04 to the contrary, in the event that the application of any
portion of prepayment required under Section 2.04(b)(i)(B) above
would cause the Borrower to incur a compensation obligation to any
Bank by reason of the prepayment of LIBOR Rate Loans on other than
the last day of an Interest Period, so long as no Event of Default
has occurred and is continuing (I) the Borrower may deposit such
amount with the Agent and direct the Agent to invest such amounts
in short term investments offered by the Agent and agreed to by the
Borrower and the Agent and held in the name of the Agent for the
benefit of the Borrower for such period as is necessary to avoid
such obligation but in no case maturing past the last day of the
Interest Period in question and (II) the Agent shall apply such
invested amount together with all interest earned thereon to the
repayment of the Revolving Credit Advances no later than on the
last day of such Interest Period; provided, further, that, upon the
occurrence and continuation of an Event of Default, the Agent may,
upon the request of the Majority Banks, cause any amount so
invested to be applied to the Obligations in such manner
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as the Majority Banks shall direct the Agent notwithstanding any
penalty arising under this Agreement.
2.11 Amendment to Section 2.05. Section 2.05 shall be deleted
in its entirety and the following shall be substituted in lieu
thereof:
(a) Aggregate Proceeds. The Borrower shall pay to the Agent
the sum (the "Aggregate Proceeds") of (i) the proceeds received by
the Borrower (after deduction for any direct costs of the
transaction payable in cash and, in the case of any lease subleased
by the Borrower to another Person, after deduction of any portion
of such proceeds paid by the Borrower to the lessor under such
Lease) of each sale, assignment, lease, sublet, transfer or other
disposition permitted under Section 5.02(c) by the Borrower of Real
Property, Leaseholds or any other asset (other than sales of
Inventory in the ordinary course of business and other than the
sale of Building No. 5 or the Cash-n-Carry Building), (ii) the
proceeds of any sale of Building No. 5 or the Cash-n-Carry Building
received after the repayment of any Building Acquisition
Indebtedness permitted by this Agreement, and (iii) any payment
received by the Borrower (whether as proceeds of any insurance
policy, any condemnation award or otherwise) in respect of a
Casualty Loss other than any payment received from a Casualty Loss
in respect to Inventory provided, however, that this Section 2.05
shall not apply to Aggregate Proceeds resulting from (A) the sale
of the Financed Customer Assets, (B) the sale of the Specified
Assets or (C) during any sale, assignment, lease, sublease,
transfer or other disposition of any of the Borrower's Assets,
together with all sales of assets by any other Loan Party, to the
extent that the aggregate of all such transfers does not exceed
Five Hundred Thousand Dollars ($500,000) in any Fiscal Year. The
Aggregate Proceeds shall be applied (as set forth in clause (b)
below) to the prepayment, in whole or, subject to the provisions of
clause (b) below, ratably in part, of the aggregate outstanding
principal amount (calculated after giving effect to all other
simultaneous or prior payments or prepayments made pursuant hereto)
of the Loans, with accrued interest to the date of such prepayment
on the amount prepaid, except to the extent that the proceeds of
any Casualty Loss shall have been made available by the Agent to
the Borrower and shall have been applied by the Borrower to the
purchase price of additional or replacement assets of the Borrower
as to which all actions required pursuant to Section 11 of the
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Security Agreement or the sections of the Mortgages relating to the
payment to the Borrower of insurance proceeds or condemnation
awards, as applicable, shall have been taken.
(b) Application. The Aggregate Proceeds shall be applied as
follows:
(i) so long as no Default shall have occurred and
be continuing, Aggregate Proceeds shall be applied first to Prime
Rate Loans and thereafter to LIBOR Rate Loans in accordance with
Schedule XVII hereto; and
(ii) in all other cases, to such Obligations of the
Borrower under the Loan Documents as the Agent shall determine in
its absolute discretion.
provided, however that, notwithstanding anything set forth in this
Section 2.05 to the contrary, in the event that the application of
any portion of prepayment required under this Section 2.05 would
cause the Borrower to incur a compensation obligation to any Bank
by reason of the prepayment of LIBOR Rate Loans on other than the
last day of an Interest Period, so long as no Event of Default has
occurred and is continuing (I) the Borrower may deposit such amount
with the Agent and direct the Agent to invest such amounts in short
term investments offered by the Agent and agreed to by the Borrower
and the Agent and held in the name of the Agent for the benefit of
the Borrower for such period as is necessary to avoid such
obligation but in no case maturing past the last day of the
Interest Period in question and (II) the Agent shall apply such
invested amount together with all interest earned thereon to the
repayment of the Revolving Credit Advances no later than on the
last day of such Interest Period; provided, further, that, upon the
occurrence and continuation of an Event of Default, the Agent may,
upon the request of the Majority Banks, cause any amount so
invested to be applied to the Obligations in such manner as the
Majority Banks shall direct the Agent notwithstanding any penalty
arising under this Agreement.
2.12 Amendment to Section 2.06. Section 2.06 shall be
deleted in its entirety and the following shall be substituted in
lieu thereof:
SECTION 2.06 Interest. (a) Pre-Default Interest Rate. The
Borrower shall pay interest on the unpaid principal amount of the
Loans outstanding at the close of
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each day until such principal amount shall be paid in full at the
following times and rates per annum (each of such rates being an
"Interest Rate"):
(i) Prime Rate Loans. During such periods as such a
Loan is a Prime Rate Loan, a rate per annum equal at all times to
the sum of the Prime Rate plus the Prime Rate Margin in effect from
time to time from and after the Amendment Effective Date to the
Termination Date. Each change in the Prime Rate shall be reflected
in the foregoing interest rates as of the effective date of such
change. Except as otherwise specifically provided herein, all
interest due hereunder will be payable in arrears, on the first day
of each calendar month herein.
(ii) LIBOR Rate Loans. During such periods as a
Loan is a LIBOR Rate Loan, a rate per annum equal at all times
during each Interest Period for such Loan to the sum of the LIBOR
Rate for such Interest Period for such Loan plus the LIBOR Rate
Margin in effect at the time of the making of such Loan, payable
(x) on the last day of such Interest Period and (y) if such
Interest Period has a duration of more than three (3) months, three
(3) months after the first day of such Interest Period and (z) on
the date such LIBOR Rate Loan shall be converted to a Prime Rate
Loan or paid in full (whether at maturity, by reason of
acceleration or otherwise).
(b) Interest Rate Margin Reduction.
(i) Conditions. Each of the Prime Rate Margin and the LIBOR
Margin shall be reduced in accordance with clause (b)(ii) below;
provided, however, that each of the following conditions shall have
been concurrently met:
(A)no Default shall have occurred and be continuing;
(B)the Agent shall have received the financial statements
required to be delivered pursuant to Section 8(iii) of the Riser
Guaranty (x) for Fiscal Years 1993 and 1994, with respect to any
reduction to be effective October 1, 1994, and (y) for Fiscal Years
1993, 1994, and 1995, with respect to any reduction to be effective
October 1, 1995; and
(C)on or after (I) the last day of Fiscal Year 1994 (the "1994
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Determination Date") or (II) the last day of Fiscal Year 1995 (the
"1995 Determination Date"), as applicable, the Agent shall have
received a certificate, in a form reasonably satisfactory to the
Agent, certifying that all of the conditions required for a
reduction in the Prime Rate Margin or the LIBOR Rate Margin, as the
case may be, shall have been satisfied as of the applicable
Determination Date;
(ii) Calculation of Reduction
(A)For the period commencing on October 1, 1994 and ending on
the earlier of the occurrence of an Event of Default or September
30, 1995, (a) if the Cumulative Consolidated Net Operating Cash
Flow as of the 1994 Determination Date shall be greater than Forty-
Three Million Two Hundred Twenty-Eight Thousand Dollars
($43,228,000), the Prime Rate Margin shall be one quarter of one
percent (1/4%) for Prime Rate Loans and the LIBOR Rate Margin shall
be two and one-half percent (2-1/2%%) or (b) if the Cumulative
Consolidated Net Operating Cash Flow as of the 1994 Determination
Date shall be greater than Fifty-Six Million Six Hundred Twenty-
Five Thousand Dollars ($56,625,000) the Prime Rate Margin shall be
zero percent (0%) and Interest shall be at the Prime Rate for Prime
Rate Loans and the LIBOR Rate Margin shall be two and one-quarter
percent (2-1/4%).
(B)For the period commencing on October 1, 1995 and ending
upon the occurrence of an Event of Default, (a) if the Cumulative
Consolidated Net Operating Cash Flow as of the 1995 Determination
Date shall be greater than Seventy-Four Million Six Hundred Fifty-
Nine Thousand Dollars ($74,659,000) but less than or equal to
Ninety-Six Million Seven Hundred Eighty-Seven Thousand
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Dollars ($96,787,000), the Prime Rate Margin shall be one quarter
of one percent (1/4%) for Prime Rate Loans and the LIBOR Rate
Margin shall be two and one-half percent (2-1/2%) or (b) if the
Cumulative Consolidated Net Operating Cash Flow as of the 1995
Determination Date shall be greater than Ninety-Six Million Seven
Hundred Eighty-Seven Eighty-Seven Thousand Dollars ($96,787,000)
the Prime Rate Margin shall be zero percent (0%) and Interest shall
be at the Prime Rate for Prime Rate Loans and the LIBOR Rate Margin
shall be two and one-quarter percent (2-1/4%).
(c) Default Interest. If any Event of Default occurs, then,
from the date such Event of Default occurs until the effective date
of a waiver of such Event of Default by the Bank, or until all
Obligations are paid and performed in full, the Borrower will pay
interest on the unpaid principal balance of the Loans at a per
annum rate (the "Default Rate") of two percent (2%) in excess of
the otherwise applicable Interest Rate.
(d) Additional Interest on LIBOR Rate Loans. To the extent
that any Bank shall be required under regulations of the Board of
Governors of the Federal Reserve System to maintain reserves with
respect to liabilities or assets consisting of or including
Eurocurrency Liabilities, the Borrower shall pay to each such Bank
additional interest on the unpaid principal amount of each Loan of
such Bank during such periods as such Loan is a LIBOR Rate Loan,
from the date such Loan is advanced to the Borrower until the
principal amount of such Loan is paid in full or converted to a
Prime Rate Loan pursuant to Section 2.02(g), at an interest rate
per annum equal at all times to the remainder obtained by
subtracting (i) the LIBOR Rate for such Interest Period for such
LIBOR Rate Loan from (ii) the rate obtained by dividing such LIBOR
Rate by a percentage equal to one hundred percent (100%) minus the
Eurocurrency Reserve Percentage of such Bank for such Interest
Period, payable on each date on which interest is payable on such
LIBOR Rate Loan. A certificate as to the amount of such additional
interest shall be submitted to the Borrower and the Agent by such
Bank, and shall be conclusive and binding for all purposes, absent
manifest error.
(e) Interest Rate Determination.
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(i)Agent Determination; Notice. The Agent shall
determine the LIBOR Rate in accordance with the definition of LIBOR
Rate set forth in Section 1.01. The Agent shall give prompt notice
to the Borrower and the Banks of the applicable interest rate
determined by the Agent for purposes of Section 2.06(a)(i) or (ii).
(ii)Failure of Borrower to Elect. If no Interest
Period is specified in any Notice of Borrowing or any Rate
Conversion/Continuation Request for any LIBOR Rate Loans comprising
a Borrowing, the Borrower shall be deemed to have selected an
Interest Period with a duration of one month. If the Borrower
shall not have given notice in accordance with Section 2.02(g) to
continue any LIBOR Rate Loans comprising a Borrowing into a
subsequent Interest Period (and shall not have otherwise delivered
a Rate Conversion/Continuation Request in accordance with Section
2.02(g) to convert such Loans), such LIBOR Rate Loans shall, at the
end of the Interest Period applicable thereto (unless repaid
pursuant to the terms hereof), automatically convert into Prime
Rate Loans.
2.13 Amendment to Section 2.08. Section 2.08 shall be
deleted in its entirety and the following shall be substituted in
lieu thereof:
SECTION 2.08 Payment not on Business Day. Whenever any
payment hereunder or under this Agreement or under the Notes shall
be stated to be due on a day other than a Business Day, such
payment shall be made on the next succeeding Business Day, except,
that, if such extension would cause payment of interest on or
principal of LIBOR Rate Loans to be made in the next following
calendar month, such payment shall be made on the immediately
preceding Business Day. Any such extension or reduction of time
shall in such case be included in the computation of payment of
interest or commitment fee, as the case may be.
2.14 Amendment to Section 2.13. Section 2.13 shall be
amended by adding the following sentence as the last sentence of
such Section:
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"Notwithstanding anything contained in this Section 2.13 to the
contrary, this Section 2.13 shall not apply to any change in law,
rule, regulation, policy or guideline causing an imposition or
increase of reserve requirements in respect of LIBOR Rate Loans
otherwise included in the Eurocurrency Reserve Percentage."
2.15 Amendment to Article II. Article II shall be
amended to include new Sections 2.14, 2.15, 2.16, 2.17, 2.18, 2.19,
2.20 and 2.21 as follows:
SECTION 2.14 Illegality. Notwithstanding any other
provision of this Agreement, if any Bank determines that any
applicable Law, or any change therein, or any change in the
interpretation or administration of any Law by any governmental
authority, central bank or comparable agency charged with the
interpretation or administration thereof, or compliance by such
Bank (or its lending office) with any request or directive (whether
or not having the force of law) of any such authority, central bank
or comparable agency, shall make it unlawful or impossible, or any
such governmental authority, central bank or agency asserts that it
is unlawful, for any Bank or its lending office to perform its
obligations hereunder to make LIBOR Rate Loans or to fund or
maintain LIBOR Rate Loans hereunder, then, upon notice to the Agent
and the Borrower by such Bank: (i) the obligation of the Banks to
make, continue or to convert Loans into, LIBOR Rate Loans shall be
suspended until the Agent shall notify the Borrower and the Banks
that the circumstances causing such suspension no longer exist and
(ii) the Borrower shall immediately, or at such later date, if any,
as may thereafter be permitted by relevant Law, prepay in full the
then outstanding principal amount of all LIBOR Rate Loans of all
Banks, together with interest accrued thereon and any other amounts
payable to the Banks hereunder unless the Borrower, within five (5)
Business Days of notice from the Agent, converts all LIBOR Rate
Loans of all Banks then outstanding into Prime Rate Loans in
accordance with Section 2.02(g) as to which such circumstances do
not exist. Any such payment or Rate Conversion shall be subject to
the applicable prepayment indemnification provisions of this
Article II.
SECTION 2.15 Unavailability. Notwithstanding any other
provision in this Agreement, if at any time with respect to any
LIBOR Rate Loans:
(a) Inadequate Rate. Any Bank notifies the Agent that the
LIBOR Rate for any Interest Period for such LIBOR Rate Loans will
not adequately
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<PAGE>
reflect the cost to such Bank of making, funding or maintaining its
LIBOR Rate Loans for such Interest Period, the Agent shall promptly
notify the Borrower and the Banks, or
(b) Unavailable Quotations. The Agent determines (which
determination shall be conclusive) that quotations of interest
rates for dollar deposits are not being provided in the relevant
amounts or for the relevant maturities to, or the circumstances
affecting the London interbank market of deposits in Dollars make
it impracticable to, determine the LIBOR Rate, or
(c) Unavailable Deposits. Any Bank determines that Dollar
deposits of the relevant amount for the relevant Interest Period
are not available in the London interbank market of deposits of
Dollars for the purpose of funding the LIBOR Rate Loans,
then (i) each LIBOR Rate Loan will automatically, on the last day
of the then existing Interest Period therefor, convert into a Prime
Rate Loan and (ii) the obligation of the Banks to make or to
convert Loans into LIBOR Rate Loans shall be suspended until the
Agent shall notify the Borrower and the Banks that the
circumstances causing such suspension no longer exist.
SECTION 2.16 Funding Costs. The Borrower agrees to
indemnify each Bank against any loss actually incurred relating in
any way to its funding of any LIBOR Rate Loan paid before its
stated maturity (whether a prepayment or a payment following any
acceleration of maturity or otherwise) and to pay that Bank, as
liquidated damages for any such loss, an amount (discounted to the
present value in accordance with standard financial practice at a
rate equal to the Treasury Yield (as defined below)) equal to
interest computed on the principal payment from the payment date to
the respective stated maturities thereof at a rate equal to the
difference of the contract rate less the treasury yield, all as
determined by that Bank in its reasonable discretion. For the
purposes of this Section 2.16, "Treasury Yield" means the annual
yield on direct obligations of the United States having a principal
amount and maturity similar to that of the principal being paid.
SECTION 2.17 Losses. If any payment of principal of or Rate
Conversion or Rate Continuation of, any LIBOR Rate Loan is made
other than on the last day of an Interest Period relating to such
Loan, as a result of a payment or Rate
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Conversion or Rate Continuation pursuant to the provisions of
Article II or acceleration of the maturity of the Notes pursuant to
Article VI or for any other reason, the Borrower shall, upon demand
by any Bank (with a copy of such demand to the Agent), pay to the
Agent for the account of such Bank any amounts (discounted to the
present value in accordance with standard financial practice at a
rate equal to the Treasury Yield) required to compensate such Bank
for any additional losses, costs or expenses which it may actually
and reasonably incur as a result of such payment or Rate Conversion
or Rate Continuation, including, without limitation, any loss
(including loss of anticipated profits), cost or expense incurred
by reason of the liquidation or reemployment of deposits or other
funds acquired by such Bank to fund or maintain such Loan.
SECTION 2.18 Indemnification for Requests. Whenever the
Borrower (a) shall revoke any Notice of Borrowing or any Rate
Conversion/Continuation Request involving any LIBOR Rate Loan, (b)
shall for any other reason fail to borrow pursuant to any such
Request or otherwise comply therewith, (c) shall fail to fulfill,
on or before the date specified in any such request, the applicable
conditions set forth in Article III of this Agreement or (d) shall
fail to honor any prepayment notice, then, in each case on any
Bank's demand, the Borrower shall indemnify each Bank and the Agent
against any loss, cost or expense actually incurred by such Bank or
the Agent as a result of any such failure by the Borrower,
including, without limitation, any loss (including loss of
anticipated profits), cost or expense incurred by reason of the
liquidation or reemployment of deposits or other funds acquired by
such Bank or the Agent to fund the LIBOR Rate Loan to be made by
such Bank or the Agent in connection with such request when such
LIBOR Rate Loan, as a result of such failure by the Borrower, is
not made on such date.
SECTION 2.19 Increased Costs. If, due to either (i) the
introduction of or any change (other than any change by way of
imposition or increase of reserve requirements in respect of LIBOR
Rate Loans otherwise included in the Eurocurrency Reserve
Percentage) in or in the interpretation of any Law or (ii) the
compliance with any guideline or request from any central bank or
other governmental authority (whether or not having the force of
Law), there shall be any increase in the cost to any Bank of
agreeing to make or making, funding or maintaining LIBOR Rate
Loans, then the Borrower shall from time to time, upon demand by
such Bank (with a copy
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<PAGE>
of such demand to the Agent), pay to the Agent for the account of
such Bank additional amounts sufficient to indemnify such Bank for
such increased cost.
SECTION 2.20 Certificate for Indemnification. Each demand by
Agent or a Bank for payment pursuant to Sections 2.13, 2.15, 2.16,
2.17, 2.18 or 2.19 or any other request for indemnification under
this Agreement or any of the Loan Documents shall be accompanied by
a certificate setting forth the reason for the payment, the amount
to be paid, that such amount has or will be actually incurred by
the Agent or such Bank and the computations and assumptions in
determining the amount, which certificate shall be presumed to be
correct. In determining the amount of any such payment thereunder,
each Bank may use reasonable averaging and attribution methods.
SECTION 2.21 Assignment of Revolving Credit Commitments
under Certain Circumstances. In the event that any one Bank shall
(i) have a Eurocurrency Reserve Percentage which is higher than
each of the other Banks which are parties hereto causing the
Borrower to pay additional interest pursuant to Section 2.06(d) in
an amount which is greater than the amount the Borrower would have
been obligated to pay if such Bank were not a party hereto or (ii)
have delivered a notice pursuant to Section 2.15(a) or 2.19 which
notice shall either prohibit the Borrower from obtaining LIBOR Rate
Loans or shall cause the Borrower to be required to make additional
payments to such Bank, the Borrower shall have the right, but not
the obligation, at its own expense, upon notice to such Bank and
the Agent, to replace such Bank with an assignee (in accordance
with and subject to the restrictions contained in Section 8.10),
and such Bank hereby agrees to transfer and assign without recourse
(in accordance with and subject to the restrictions contained in
Section 8.10 all its interests, rights and obligations under this
Agreement to such assignee; provided, however, that (a) no such
assignment shall conflict with any Law and (b) the Borrower or such
assignee, as the case may be, shall pay to the affected Bank in
immediately available funds on the date of such assignment the
principal of and interest accrued to the date of payment on the
Loans made by such Bank hereunder and all other amounts accrued for
such Bank's account or owned to it hereunder, including, without
limitation, any amounts owing in respect of any indemnification or
reimbursement obligation under this Agreement.
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2.16 Amendment to Section 3.02. Section 3.02 shall be deleted
in its entirety and the following shall be substituted in lieu
thereof:
SECTION 3.02. Additional Conditions Precedent. It shall
be an additional condition precedent to each Loan under
this Agreement, to each Rate Conversion or Rate Continuation and to
the issuance of each Letter of Credit that on the date of such
Loan, Rate Conversion, Rate Continuance or issuance, respectively,
after giving effect thereto:
(a) Continuing Representations. The following statements
shall be true and correct in all respects:
(i) the representations and warranties of each Loan
Party contained in the Loan Documents are correct on and as of the
date of such Loan or issuance, respectively, as though made on and
as of such date,
(ii) the Revolving Credit Availability of the
Eligible Collateral is no less than the sum of the aggregate
principal amount of the Revolving Credit Advances to be outstanding
plus the aggregate of the Letter of Credit Face Amount of all
outstanding Letters of Credit, after giving effect to such
Revolving Credit Advance, Rate Continuation, Rate Conversion or
issuance, respectively, and
(iii) no event has occurred and is continuing, or would
result from such Loan, Rate Continuation, Rate Conversion or
issuance, respectively, that constitutes a Default.
The giving of each Notice of Borrowing and the receipt of the
proceeds of each Loan, the giving of a Rate Continuation/Rate
Conversion Notice and the effectiveness of the Rate Conversion or
Rate Continuation referred to therein, and the making of each
request for issuance of a Letter of Credit and the issuance of such
Letter of Credit shall each constitute a representation and
warranty by the Borrower that each of the foregoing statements
shall be true as of the date of such Loan, Rate Conversion, Rate
Continuation or issuance, respectively.
(b) Additional Information. The Agent shall have
received such other instruments, information, approvals, opinions
or documents as the Agent may reasonably request.
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2.17 Amendment to Section 5.02(b). Section 5.02(b) shall
be deleted in its entirety and the following shall be substituted
in lieu thereof:
(b) Indebtedness. The Borrower shall not create or suffer to
exist, or permit any of its Subsidiaries to
create or suffer to exist, any Indebtedness, liability or other
obligation except (i) Indebtedness secured by Liens or security
interests permitted by Section 5.02(a), (ii) the Subordinated
Debentures, (iii) the MetLife Indebtedness, so long as the
aggregate principal amount of such Indebtedness shall not at any
time exceed Six Million Dollars ($6,000,000), (iv) the Fifth Third
Indebtedness, so long as the aggregate principal amount of such
Indebtedness shall not at any time exceed Four Hundred Eighty-Nine
Thousand Three Hundred Sixty-Eight and 92/100ths Dollars
($489,368.92), (v) the Indebtedness set forth on Schedule 5.02(b),
(vi) ordinary course trade payables, (vii) Indebtedness evidenced
by bankers' acceptances used by the Borrower to pay its ordinary
course trade payables and (viii) the Building Acquisition
Indebtedness, so long as the original aggregate principal amount of
such Indebtedness shall not exceed Three Million Five Hundred
Thousand Dollars ($3,500,000).
2.18 Amendment to Section 5.02(c). Section 5.02(c) shall
be deleted in its entirety and the following shall be substituted
in lieu thereof:
(c) Sales, Etc. of Assets. The Borrower shall not sell,
lease, transfer or otherwise dispose of, or permit any of its
Subsidiaries to sell, lease, transfer, or otherwise dispose of, any
of its assets, except (i) sales of inventory in the ordinary course
of business, (ii) so long as no Default has occurred hereunder,
with respect to assets other than Inventory sold in the ordinary
course of business, sales or transfers permitted by Section 7(u) of
the Riser Guaranty so long as all the proceeds of any sales,
leases, transfers and other dispositions of assets under this
subsection (ii) (other than sales of Inventory in the ordinary
course of business) shall be applied in accordance with Section
2.05 or (iii) the Borrower may sell either or both of Building No.
5 and the Cash-n-Carry Building so long as all the proceeds of any
such sales shall be applied in accordance with Section 2.05 of this
Agreement.
2.19 Amendment to Section 5.02(m). Section 5.02(m) shall
be deleted in its entirety and the following shall be substituted
in lieu thereof:
(m) Issuance of Transfer of Stock. Except with respect to
Shares issued as of the date hereof as
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identified on Schedule 4.01(h) hereof and upon conversion of any
Subordinated Debenture convertible into Shares, the Borrower shall
not issue or permit to be transferred any of the Shares of capital
stock.
2.20 Amendment to Section 8.25. Section 8.25 shall be
deleted in its entirety and the following shall be substituted in
lieu thereof:
SECTION 8.25 Commitments. The Revolving Credit Commitment,
the Term Loan Commitment and the Total Commitment of each Bank
shall be as set forth below:
<TABLE>
<CAPTION>
BANK TERM REVOLVLING BANK'S
LOAN CREDIT TOTAL
COMMITMENT COMMITMENT COMMITMENT
<S> <C> <C> <C>
Society National $3,428,573 $21,200,000 $24,628,573
Bank
National City $2,000,001 $12,349,000 $14,349,001
Bank
NBD Bank, N.A. $1,817,724 $11,251,466 $13,069,189
Star Bank, N.A. $1,325,134 $ 8,199,534 $ 9,524,669
Total of
Commitments $ 8,571,432 $53,000,000 $61,571,432
</TABLE>
SECTION 3. REPRESENTATIONS AND WARRANTIES.
The Borrower hereby represents and warrants to the Banks
and the Agent as follows:
3.1 The Amendment. This Amendment has been duly and
validly executed by an authorized executive officer of the Borrower
and constitutes the legal, valid and binding obligation of the
Borrower enforceable against the Borrower in accordance with its
terms. The Credit Agreement, as amended by this Amendment, remains
in full force and effect and remains the valid and binding
obligation of the Borrower enforceable against the Borrower in
accordance with its terms. The Borrower hereby ratifies and
confirms the Credit Agreement as amended by this Amendment.
3.2 Nonwaiver. The execution, delivery, performance and
effectiveness of this Amendment shall not operate nor be deemed to
be nor construed as a waiver (i) of any right, power or remedy of
the Banks or the Agent under the Credit Agreement, nor (ii) of any
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term, provision, representation, warranty or covenant contained in
the Credit Agreement or any other documentation executed in
connection therewith. Further, none of the provisions of this
Amendment shall constitute, be deemed to be or construed as, a
waiver of any Default or Event of Default under the Credit
Agreement as amended by this Amendment.
3.3 Reference to and Effect on the Credit Agreement.
Upon the Effectiveness of this Amendment, each reference in the
Credit Agreement to "this Agreement", "hereunder", "hereof",
"herein", or words of like import shall mean and be a reference to
the Credit Agreement, as amended by the First Amendment and this
Amendment and each reference to the Credit Agreement in any other
document, instrument or agreement executed and/or delivered in
connection with the Credit Agreement shall mean and be a reference
to the Credit Agreement, as amended by the First Amendment and this
Amendment.
SECTION 4. CONDITIONS PRECEDENT TO EFFECTIVENESS
OF THIS AMENDMENT NO. 2.
In addition to all of the other conditions and agreements
set forth herein, the effectiveness of this Amendment is subject to
the following conditions precedent:
4.1 The Amendment. The Banks and the Agent shall have
received this Amendment No. 2 to Amended and Restated Credit
Agreement, executed and delivered by a duly authorized officer of
the Borrower.
4.2 Other Amendments. The Banks and the Agent shall
have received each of Amendment No. 3 to Amended and Restated
Guaranty Agreement, executed and delivered by a duly authorized
officer of Riser and Amendment No. 3 to Credit Agreement in respect
of the Rini-Rego Agreement, each executed and delivered by a duly
authorized officer of Rini-Rego, and all of the conditions
precedent to such Amendment shall have been satisfied.
4.3 Acknowledgement of Guarantors. The Banks and the
Agent shall have received the Acknowledgement of Guarantors
attached to this Amendment, executed and delivered by a duly
authorized officer of each of the Guarantors of the indebtedness of
the Borrower to the Banks and the Agent.
4.4 Borrower's Certificate. The Banks and the Agent
shall have received a certificate, in form and substance
satisfactory to the Agent, executed for an on behalf of the
Borrower by the Chief Executive Officer and the Secretary of the
Borrower and dated as of the date of this Amendment, certifying (i)
the Director's Resolutions of the Borrower authorizing this
Amendment, and each document or other instrument executed in
connection with the Amendment, (ii) the names and signatures of the
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officers of the Borrower, and (iii) compliance by the Borrower with
all representations, warranties, covenants and conditions under the
Credit Agreement as amended by this Amendment.
4.5 Other Documents. The Banks and the Agent shall have
received each additional document, instrument or piece of
information reasonably requested by the Agent, including, without
limitation, any financing statements as may be necessary to
continue the perfection of the security interests created by the
Security Agreements.
SECTION 5. MISCELLANEOUS.
5.1 Governing Law. This Amendment shall be governed by
and construed in accordance with the laws of the State of Ohio.
5.2 Severability. In the event any provision of this
Amendment should be invalid, the validity of the other provisions
hereof and of the Credit Agreement shall not be affected thereby.
5.3 Counterparts. This Amendment may be executed in one
or more counterparts, each of which, when taken together, shall
constitute but one and the same agreement.
[ REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
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IN WITNESS WHEREOF, the Borrower has caused this
Amendment No. 2 to Amended and Restated Credit Agreement to be duly
executed and delivered by its duly authorized officer as of the
date first above written.
AMERICAN SEAWAY FOODS, INC.
(formerly known as Heritage
Wholesalers, Inc.)
By:
Title:
180\22687EOB.120
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ACCEPTED AND AGREED as of
the date and year first above written by:
SOCIETY NATIONAL BANK, as a NBD BANK,
Bank and as Agent as a Bank
By: By:
Title: Title:
NATIONAL CITY BANK, STAR BANK, N.A., as a Bank
as a Bank
By: By:
Title: Title:
180\22687EOB.120
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ACKNOWLEDGEMENT OF GUARANTORS
Each of the undersigned, RISER FOODS, INC., SEAWAY FOOD
SERVICE, INC. (formerly known as American Seaway Foods, Inc.)
FISHER PROPERTIES, INC., and RINI-REGO SUPERMARKETS, INC. (formerly
known as Fisher Foods, Inc.), each of which being a guarantor of
indebtedness of the Borrower to the Banks and the Agent, hereby
acknowledges and agrees to the terms of the foregoing Amendment No.
2 to Amended and Restated Credit Agreement. Each of the
undersigned represents and warrants to the Banks and the Agent that
the respective Amended and Restated Guaranty Agreements (as
amended), executed and delivered by each of the undersigned, each
dated as of May 27, 1993, remain the valid and binding obligations
of each of the undersigned, respectively, enforceable against it in
accordance with their terms.
RISER FOODS, INC.
By:
Title:
SEAWAY FOOD SERVICE, INC. (formerly
known as American Seaway Foods, Inc.)
By:
Title:
RINI-REGO SUPERMARKETS, INC.
(formerly
known as Fisher Foods, Inc.)
By:
Title:
FISHER PROPERTIES, INC.
By:
Title:
Executed: April , 1995
-30-
PAGE
<PAGE>
EXHIBIT B
TO
AMENDED AND RESTATED CREDIT AGREEMENT
FORM OF NOTICE OF BORROWING
To: Society National Bank, as Agent
Subject: Amended and Restated Credit Agreement, dated as of May
27, 1993 (as amended from time to time, the "Credit Agreement"),
among American Seaway Foods, Inc. (the "Borrower"), the Banks which
are a party thereto and Society National Bank, as Agent.
Greetings:
Each capitalized term in this Notice of Borrowing shall be
defined in accordance with the Credit Agreement. Pursuant to the
Credit Agreement, we request
( ) the Banks to grant us a [Term Borrowing][Revolving
Credit Borrowing] consisting of a series of LIBOR Rate Loans in the
aggregate principal sum of $__________________, each with an
initial Interest Period of _________ month(s), to be made available
on the ____ day of ______________, 19___.
and, in the case of any requested Borrowing, to disburse the
proceeds as follows:
The undersigned Borrower hereby certifies that the statements
sEt forth in Section 3.02(a) of the Credit Agreement are true on
the date hereof, and will be true on the date of the Term Borrowing
or Revolving Credit Borrowing, as the case may be, before and after
giving effect thereto.
AMERICAN SEAWAY FOODS, INC.
By:
Its:
In the event that the Borrower desires to request more than one
Borrowing (being of a different type of Borrowing or having
different Interest Period) or more than on Letter of Credit on the
same day the Borrower may deliver more than one Notice of Borrowing
(subject to the limitations of 2.02(a))
PAGE
<PAGE>
EXHIBIT C
TO
AMENDED AND RESTATED CREDIT AGREEMENT
FORM RATE CONVERSION/CONTINUATION REQUEST
To: Society National Bank, as Agent
Subject: Amended and Restated Credit Agreement, dated as of May
27, 1993 (as amended from time to time, the "Credit Agreement"),
among American Seaway Foods, Inc. (the "Borrower"), the Banks which
are a party thereto and Society National Bank, as Agent.
Greetings:
Each capitalized term used in this Rate Conversion/Continuation
Request shall be defined in accordance with the Credit Agreement.
Pursuant to the Credit Agreement, we request
( ) the Banks to convert $_________________ principal amount
of the [Prime Rate Loans] [LIBOR Rate Loans] comprising the [Term
Borrowing][Revolving Credit Borrowing] (or portion thereof)
[converted] [continued] on _____________, 199_ in the original
aggregate principal sum of [$___________________], on
_________________, 199_, into a [Term Borrowing][Revolving Credit
Borroiwng] of [LIBOR Rate Loans to have an Interest Period of ___
months from the date thereof] [Prime Rate Loans].*
( ) the Banks to continue $_________________ principal
amount of the LIBOR Rate Loans comprising the [Term
Borrowing][Revolving Credit Borrowing] (or portion thereof)
[converted] [continued] on _____________, 199_ with a ___ month
Interest Period in the original aggregate principal sum of
[$___________________] as a [Term Borrowing][Revolving Credit
Borrowing] of LIBOR Rate Loans having an Interest Period of the
same duration commencing on _________________, 199_.
( ) the Banks to convert $___________________ principal
amount of the LIBOR Rate Loans comprising the [Term
Borrowing][Revolving Credit Borrowing] (or portion thereof
[converted] [continued] on _____________, 199_ with a ___ month
Interest Period in the original aggregate principal sum of
[$___________________] to a [Term Borrowing][Revolving Credit
Borrowing] of LIBOR Rate Loans having an Interest Period of ___
months commencing on _________________, 199_.
The undersigned represents and warrants that this request is
made in compliance with Section 2.02(d) of the Credit
Agreement.
PAGE
<PAGE>
The undersigned Borrower hereby certifies that the statements
set forth in Section 3.02(a) of the Credit Agreement
are true on the date hereof, and will be true on the date of the
Rate Conversion or Rate Continuation before and after
giving effect thereto.
AMERICAN SEAWAY FOODS, INC.
By:
Its:
In the event that the Borrowere desires to convert or continue
more than one Borrowing of LIBOR Rate Loans (having a different
Interest Period on the same day the Borrowere may deliver more than
one Rate Conversion/Continuation Request (subject to the
limitations of 2.02(b)).
PAGE
<PAGE>
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
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<FISCAL-YEAR-END> JUL-01-1995
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