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11127989
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AMENDMENT NO. 2 TO THE COMPANY SECURITY AGREEMENT
AMENDMENT NO. 2, dated as of April 21, 1995, to
the Company Security Agreement, dated as of March 4, 1992
(the "Security Agreement"), between Homeland Stores, Inc., a
Delaware corporation (the "Company"), and United States
Trust Company of New York, a New York banking corporation,
as collateral trustee (the "Collateral Trustee") for the
holders of the Senior Secured Notes (as hereinafter defined)
(the "Securityholders"). Capitalized terms used herein and
not otherwise defined herein shall have the meaning given to
such terms in the Indenture.
RECITALS
WHEREAS, the Company, Homeland Holding Corporation
("Holding"), and the Collateral Trustee have heretofore
entered into an Indenture, dated as of March 4, 1992, as
supplemented by First Supplement to Indenture, dated as of
June 17, 1992 (the "Indenture"), providing for the issuance
of up to $120,000,000 in aggregate principal amount of the
Company's senior secured notes (together with any securities
issued in replacement thereof or in exchange or substitution
thereof, the "Senior Secured Notes");
WHEREAS, pursuant to the terms of the Indenture,
to secure the payment and performance by the Company of the
Obligations, the Company and the Collateral Trustee have
heretofore entered into the Security Agreement, whereby the
Company has granted to the Collateral Trustee for the
ratable benefit of the Securityholders a security interest
in and to the Collateral; and
WHEREAS, Securityholders of at least a majority in
principal amount of the Senior Secured Notes then
outstanding (other than Senior Secured Notes owned by the
Company or any of its affiliates) have consented to the
amendments to the Security Agreement set forth herein.
NOW, THEREFORE, in consideration of the foregoing
and for good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the Company and
the Collateral Trustee (for the ratable benefit of the
Securityholders) agree as follows:
Section 1. Amendment to Section 2(b) of the
Security Agreement. Section 2(b) of the Security Agreement
is amended by adding the following proviso at the end
thereof:
"; provided, however, that the
Collateral Trustee's security interest
in Collateral consisting of AWG Equity
shall be subordinate and junior to AWG's
first priority security interest in the
AWG Equity under the Supply Agreement
and the Membership Sign-Up Documents."
Section 2. Amendment to Section 3(c) of the
Security Agreement. Section 3(c) of the Security Agreement
is amended to read in its entirety as follows:
"The Company is (or, to the extent
that this Security Agreement states that
the Collateral is to be acquired after
the date hereof, will be) the sole owner
of the Collateral; the security interest
created hereby in Collateral is a valid,
enforceable, perfected and first
priority security interest in the
Collateral securing the payment of the
Obligations (provided, however, that the
security interest granted hereby in
Collateral consisting of AWG Equity
shall be valid, enforceable and
perfected and prior to all other
security interests in such Collateral
other than the security interest in
favor of AWG under the Supply Agreement
and the Membership Sign-Up Documents)
and there are no other security
interests in, Liens on, adverse claims
of title to, or any other interests
whatsoever in, the Collateral or any
portion thereof except (i) Liens
permitted to be incurred pursuant to
Section 4.13 of the Senior Secured Note
Indenture ("Authorized Liens") and (ii)
to the extent that proceeds from certain
sales of assets may be applied to
certain other indebtedness of the
Company as provided in Section 4.10 of
the Senior Secured Note Indenture; and
no financing statement, notice of Lien,
assignment or collateral assignment,
mortgage or deed of trust covering the
Collateral or any portion thereof ("Lien
Notice") exists or is on file in any
public office, except with respect to
Authorized Liens;"
Section 3. Ratification. The Security Agreement,
as amended by this Amendment No. 2 is hereby in all respects
ratified and confirmed.
Section 4. Governing Law. This Amendment No. 2
shall be governed by, and construed in accordance with, the
laws of the State of New York, without regard to conflicts
of laws principles.
Section 5. Counterparts. This Amendment No. 2
may be executed in any number of counterparts, each of which
shall, when executed, be deemed to be an original and all of
which shall be deemed to be one and the same instrument.
IN WITNESS WHEREOF, the parties hereto have
executed this Amendment No. 2 as of the date first above
written.
HOMELAND
STORES, INC., a Delaware
corporation
By: /s/ Mark S. Sellers
Name: Mark S. Sellers
Title: Executive Vice
President - Finance
UNITED STATES
TRUST COMPANY OF NEW
YORK, as Trustee under the
Indenture
By: /s/ Robert E. Patterson, III
Name: Robert E. Patterson, III
Title: Asst. Vice President