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LIMITED WAIVER
THIS LIMITED WAIVER (this "Waiver"), dated as of October 27, 1994,
relates to that certain Credit Agreement dated as of October 12, 1988, and
amended and restated as of September 14, 1989 (as further amended, modified or
supplemented through the date hereof, the "Credit Agreement"), among Kash n'
Karry Food Stores, Inc. (the "Borrower"), the Senior Lenders referred to
therein and Bank of America National Trust and Savings Association (as
successor in interest to Security Pacific National Bank) as agent (in such
capacity, the "Agent") for the Senior Lenders. Unless otherwise defined herein,
terms defined in the Credit Agreement are used herein with the same meanings
ascribed to them therein. In addition to the covenants and agreements made in
the Credit Agreement and the other Loan Documents, Borrower, the Senior Lenders
and the Agent further covenant and agree as follows:
1. Limited Waiver. Subject to the terms and conditions set forth
herein, the Requisite Senior Lenders hereby agree to waive:
(a) The provisions of Section 2.02(a)(v) of the Credit
Agreement in respect (and solely in respect) of the Borrower's failure
to comply with the Revolver Cleandown requirement set forth therein
for the Fiscal Year ending in 1994 ("Fiscal Year 1994");
(b) The provisions of Section 9.01 of the Credit Agreement in
respect (and solely in respect) of the Borrower's failure to comply
with the Minimum Net Worth amount set forth therein for the first,
second, third and fourth quarters of Fiscal Year 1994;
(c) The provisions of Section 9.03 of the Credit Agreement in
respect (and solely in respect) of the Borrower's failure to comply
with the Fixed Charge Coverage Ratio set forth therein for the first,
second, third and fourth quarters of Fiscal Year 1994; and
(d) The provisions of Section 9.04 of the Credit Agreement in
respect (and solely in respect) of the Borrower's failure to comply
with the Interest Coverage Ratio set forth therein for the first,
second, third and fourth quarters of Fiscal Year 1994; and
(e) The provisions of Section 10.01(e) of the Credit Agreement
in respect (and solely in respect) of the nonpayment of interest due
on August 1, 1994 to holders of the New Senior Notes and the Junior
Subordinated Debentures and the nonpayment of interest due on August
2, 1994 to
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holders of the Senior Notes (together with the New Senior Notes
and the Junior Subordinated Debentures, the "Public Debt").
Among other things, the effect of this Waiver is to extend, on the
terms and conditions set forth herein, the Limited Waivers dated as of December
15, 1993, March 11, 1994, June 10, 1994, July 5, 1994, September 14, 1994, and
September 29, 1994 respectively, among the Borrower, the Agent and the
Requisite Senior Lenders for the period from the Effective Date to the
Termination Date (in each case, as defined herein). In addition to the
foregoing, and for the duration of this Waiver, none of the Senior Lenders
shall be obligated to make a Fixed Rate Loan.
2. Affirmation of Obligations. The Borrower hereby reaffirms its
obligations and agreements pursuant to Sections 3 and 4 of the Limited Waiver
dated as of September 29, 1994 among the parties hereto.
3. Effective Date. This Waiver shall become effective upon the date
(the "Effective Date") on or before October 31, 1994 on which the Agent has
received each of the following:
(a) Counterparts hereof signed by the Borrower, the Requisite
Senior Lenders and the Agent; and
(b) Payment in cash in same day funds of all fees and expenses
for which the Borrower has received invoices for the payment thereof.
4. Termination Date. This Waiver (other than the Borrower's agreements
and obligations under Sections 2 and 8) shall expire and cease to be of any
force or effect automatically (without any action by the Agent or any Senior
Lender) at 5:00 p.m., Los Angeles time, on the date (the "Termination Date")
which is the earlier of (a) November 10, 1994 and (b) the earliest date on
which any of the conditions set forth below fails to be satisfied:
(i) No Event of Default or Potential Event of Default
(including without limitation failure to pay costs and expenses
upon demand in accordance with Section 12.03 of the Credit
Agreement) shall have occurred (other than those expressly waived
by this Waiver);
(ii) No event shall have occurred and be continuing (for at
least two Business Days after notice thereof from Agent to the
Borrower) which materially adversely affects the business,
condition (financial or
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otherwise), properties or prospects of the Borrower and any
Subsidiary of the Borrower, taken as a whole;
(iii) None of the holders of any of the Public Debt nor any
representative of any of them (including without limitation a
trustee under an indenture governing the terms of any of them)
shall have exercised any remedies available to any of them by
reason of a default under the Senior Notes, the New Senior Notes
or the Junior Subordinated Debentures or any of the indentures
governing the terms thereof;
(iv) The Borrower shall not establish or maintain any deposit
account or lock box other than a deposit account or lock box
maintained with a Senior Lender;
(v) The Borrower shall not directly or indirectly make or own
any Investment in Cash Equivalents other than Cash Equivalents in
the possession of, subject to an investment account maintained
with, or otherwise subject to the control of, a Senior Lender;
and
(vi) The Borrower shall not enter into any agreement with any
Person pursuant to which the Borrower, as debtor-in-possession in
any case under the Bankruptcy Code (a "Bankruptcy Case"), may
become directly or indirectly liable for any Indebtedness (the
"DIP Facility") such that the sum of (A) the maximum principal
amount of loans or other financial accommodations permitted to be
outstanding under the DIP Facility, plus (B) the Loans and
Reimbursement Obligations then outstanding, shall exceed the
aggregate amount for which the Borrower has then obtained written
commitments to make advances to the Borrower on the effective
date of a plan of reorganization to be approved in the Bankruptcy
Case for the purpose of paying in full all Obligations, together
with all obligations payable under the DIP Facility. Nothing in
this Section 7(vi) shall be construed as a consent by the Agent
or any Senior Lender to a DIP Facility or any other terms or
conditions applicable thereto.
5. Termination of Automatic Stay. The Borrower hereby acknowledges and
agrees that the condition set forth in Section 7(vi) is a material inducement
to the Requisite Senior Lenders to enter into this Waiver and that, in the
event of the filing of a Bankruptcy Case, the failure of this condition shall
be deemed to constitute a lack of adequate protection pursuant to Section
362(d)(1) of the Bankruptcy Code. The Borrower hereby stipulates that the
failure of this condition during a Bankruptcy
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Case shall cause the immediate termination of the automatic stay under
the Bankruptcy Code without further notice to the Borrower or order of the
bankruptcy court. The Borrower agrees that a copy of this Waiver may serve as
evidence of this stipulation in any Bankruptcy Case. The Borrower agrees not to
contest such termination of the automatic stay or the consequences thereof. The
Borrower's agreements and obligations under this Section 8 shall survive the
Termination Date (as defined above) and shall not be limited in any way by the
passage of time or occurrence of any event.
6. Representations and Warranties. The Borrower hereby represents and
warrants that, as of the date hereof, and after giving effect to this Waiver:
(a) The execution, delivery and performance by the Borrower of
this Waiver has been duly authorized by all necessary corporate
action;
(b) No Event of Default or Potential Event of Default (other
than those expressly waived by this Waiver) has occurred or is
continuing; and
(c) The representations and warranties of the Borrower
contained in Section 5.03 of the Credit Agreement and any other Loan
Document (other than representations and warranties which expressly
speak as of a different date) are true, correct and complete in all
material respects, except that such representations and warranties
need not be true, correct and complete to the extent that changes in
the facts and conditions on which such representations and warranties
are based are required or permitted under the Credit Agreement.
7. Acknowledgment of Indebtedness and Liens. The Borrower acknowledges
and stipulates that (a) as of the close of business on October 27, 1994, the
aggregate unpaid principal amount of Loans outstanding is at least
$53,466,233.75, and the aggregate undrawn face amount of the Letters of Credit
is $ 16,669,215.85, (b) the Loans, together with the other Obligations,
constitute legal, valid, binding and enforceable obligations of the Borrower,
not avoidable or subject to subordination by the Borrower to any extent, and
there are no defenses or counterclaims with respect thereto in favor of the
Borrower, (c) the Liens created by the Collateral Documents are legal, valid,
binding and enforceable against the Borrower and are not avoidable or subject
to subordination by the Borrower, and there are no defenses thereto in favor of
the Borrower, and (d) the Liens created by the Collateral Documents are
perfected under the Uniform Commercial Code as in effect in any applicable
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jurisdiction or any other Requirement of Law applicable to any Collateral.
8. Limitation on Waiver. This Waiver shall be limited solely to the
matters expressly set forth herein and shall not (i) constitute a waiver or
amendment of any other term or condition of the Credit Agreement, or of any
instruments or agreements referred to therein, (ii) prejudice any right or
rights which the Agent or any of the Senior Lenders may now have or may have in
the future under or in connection with the Credit Agreement or any instruments
or agreements referred to therein, or (iii) require the Senior Lenders to agree
to a similar waiver or grant a similar waiver for a similar transaction or on a
future occasion. Except to the extent specifically waived herein, the
provisions of the Credit Agreement shall not be amended, modified, impaired or
otherwise affected hereby, and the Credit Agreement and all of the Obligations
are hereby confirmed in full force and effect.
9. Miscellaneous. This Waiver is a Loan Document and, together with the
Credit Agreement and the other Loan Documents, comprises the complete and
integrated agreement of the parties on the subject matter hereof. The headings
herein are for convenience of reference only and shall not alter or otherwise
affect the meaning hereof.
10. Governing Law. This Amendment shall be governed by, and shall be
construed and enforced in accordance with, the laws of the State of New York.
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11. Counterparts. This Amendment may be executed in any number of
counterparts which, when taken together, shall be deemed to constitute one and
the same instrument.
WITNESS the due execution hereof as of the date first above written.
KASH N' KARRY FOOD STORES, INC.,
as Borrower
By: /s/ R.P. Springer
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Title: Executive Vice President
BANK OF AMERICA NATIONAL TRUST AND
SAVINGS ASSOCIATION (as successor
in interest to SECURITY PACIFIC
NATIONAL BANK), as Agent
By: /s/ Laura Knight
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Title: Vice President
BANK OF AMERICA NATIONAL TRUST AND
SAVINGS ASSOCIATION (as successor
in interest to SECURITY PACIFIC
NATIONAL BANK), as a Senior Lender
By: /s/ H.G. Wheelock
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Title: Vice President
WELLS FARGO BANK, N.A.
By: /s/ Jeffrey P. Rose
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Title: Vice President
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BARNETT BANK OF TAMPA (as successor
in interest to First Florida Bank,
N.A.), by BARNETT BANKS, INC., as
attorney-in-fact for Barnett Bank
of Tampa
By:
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Title:
NATIONSBANK OF FLORIDA, N.A.
By:
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Title:
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