EXHIBIT 10.18
FIFTH AMENDMENT TO LOAN AGREEMENT
THIS FIFTH AMENDMENT TO LOAN AGREEMENT, made as of this 31 day of May,
2000, by and among SCHULTZ SAV-O STORES, INC. ("Borrower"), M&I MARSHALL &
ILSLEY BANK, a Wisconsin banking corporation ("M&I"), and FIRSTAR BANK
MILWAUKEE, N.A., a national banking association ("Firstar" and, together with
M&I, the "Banks"). Unless otherwise indicated, capitalized terms used herein and
not defined shall have the meanings assigned thereto in the Loan Agreement
described below.
WITNESSETH:
WHEREAS, Borrower, M&I and Firstar are parties to that certain Loan
Agreement dated as of December 3, 1992, as amended by that certain First
Amendment to Loan Agreement dated September 23, 1994, that certain Second
Amendment to Loan Agreement dated December 17, 1996, that certain Third
Amendment to Loan Agreement dated May 14, 1997, and that certain Fourth
Amendment to Loan Agreement dated December 31, 1998 (as so amended, the "Loan
Agreement"); and
WHEREAS, Borrower has available a $9,000,000 revolving line of credit
facility with M&I and a $7,000,000 revolving line of credit facility with
Firstar (collectively, the "Lines of Credit") pursuant to the Loan Agreement;
and
WHEREAS, Borrower and the Banks desire to amend the Loan Agreement to
amend the definitions of Maturity Date and Net Earnings Available For Restricted
Payments.
NOW, THEREFORE, in consideration of the premises and mutual agreements
contained herein and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:
1. Amendment to Section 1 (b) (Master Notes). The definition of
Maturity Date is amended be deleting "April 30, 2001" and inserting in lieu
thereof "April 30, 2003".
2. Amendment to Section 9 (l) (Net Earnings Available For Restricted
Payments). The definition of Net Earnings Available For Restricted Payments is
amended by restating the definition in its entirety as follows:
(l) "Net Earnings Available For Restricted Payments" shall mean an
amount equal to (i) the sum of (A) $23,263,000, (B) 50% (or minus 100%
in the case of a deficit) of Net Earnings for the period (taken as one
accounting period) commencing December 29, 1991, and terminating at the
end of the last fiscal quarter preceding the date of any proposed
Restricted Payment, (C) 100% of the tax benefit realized by the
Borrower as a result of the exercise by employees of stock options of
the Borrower (reflected in the Borrower's Consolidated Statement of
Shareholders' Investment as "Exercise of Stock Options" under the
heading "Additional Paid-in Capital"), and (D) 100% of the net cash
proceeds received by the Company from the issuance or sale of
authorized but unissued shares of its Common Stock, but only to the
extent of the number of such shares previously acquired in transactions
which constituted the making of Restricted Payments, less (ii) the sum
of all Restricted Payments made on or after December 29, 1991.
3. Effective Date. This Amendment shall be effective upon the execution
and delivery by Borrower to the Banks of the following:
(a) This Amendment duly executed by the President and Secretary of
Borrower; and
(b) A copy of the resolution or resolutions, in form satisfactory to
the Banks and their legal counsel, duly adopted by the Board of Directors of
Borrower approving this Amendment, certified to be true and correct by the
Secretary of Borrower.
4. Miscellaneous.
(a) Continuance of Loan Documents. Except as specifically amended by
this Amendment, the Loan Agreement and all other instruments, documents and
agreements executed and delivered in connection with the Loan Agreement
collectively, the "Loan Documents") remain in full force and effect. This
Amendment is an amendment and not a novation.
(b) Representations and Warranties. Customer represents and warrants
that the execution, delivery and performance of this Amendment are within the
corporate powers of Borrower, have been duly authorized by all necessary
corporate action, and do not and will not (a) require any consent or approval of
the shareholders of Borrower; (b) violate any provision of the Articles of
Incorporation or By-laws of Borrower or of any law, rule, regulation, order,
writ, judgment, injunction, decree, determination or award presently in effect
having applicability to Borrower; (c) require the consent or approval of, or
filing of a registration with, any government body, agency or authority; or (d)
result in any breach of or constitute a default under, or result in the
imposition of any lien, charge or encumbrance upon any property of Borrower
pursuant to any indenture or other agreement or instrument under which Borrower
is a party or by which it or its properties may be bound or affected. Borrower
further represents and warrants that this Amendment constitutes the legal, valid
and binding obligation of Borrower enforceable in accordance with its terms,
except as such enforceability may be limited by bankruptcy or similar laws
affecting the enforceability of creditors' rights generally. In addition, each
of the representations and warranties made by Borrower in the Loan Agreement are
true and correct as of the date of this Amendment except for matters permitted
or contemplated by the Loan Agreement.
(c) References. When any Loan Document is referred to in any other Loan
Document or any of the other documents, instruments or materials executed and
delivered heretofore or hereafter pursuant to the Loan Agreement, it shall be
deemed to refer to such Loan Document as amended by this Amendment.
(d) Expenses and Attorneys' Fees. In accordance with Section 10(f) of
the Loan Agreement, Borrower shall pay all fees and expenses incurred by the
Banks, including the reasonable fees of counsel, in connection with the
preparation of this Amendment, the consummation of the transactions contemplated
by this Amendment and the protection or enforcement of the rights of the Banks
under the Loan Agreement.
(e) Survival. All agreements, representations and warranties made in
this Amendment or in any documents delivered pursuant to this Amendment shall
survive the execution of this Amendment and the delivery of any such document.
(f) Governing Law. This Amendment and the other documents issued
pursuant to this Amendment are governed by the laws of the State of Wisconsin
without reference to the conflict of law principles of such state.
(g) Counterparts; Headings. This Amendment may be executed in several
counterparts, each of which shall be deemed an original, but such counterparts
shall together constitute one and the same agreement. Article and Section
headings in this Amendment are inserted for convenience of reference only and
shall not constitute a part hereof.
(h) Severability. Any provision of this Amendment that is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such prohibition or unenforceability without invalidating the
remaining provisions of this Amendment or affecting the validity or
enforceability of such provision in any other jurisdiction.
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IN WITNESS WHEREOF, the parties hereto have executed this Fourth
Amendment to Loan Agreement as of the day, month and year first above-written.
(Signatures continue on the following page)
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SCHULTZ SAV-O STORES, INC.
By: /s/ James H. Dickelman
------------------------------------
James H. Dickelman, Chairman,
President and Chief Executive
Officer
Attest: /s/ Armand C. Go
---------------------------------
Armand C. Go, Treasurer and Chief
Accounting Officer
M&I MARSHALL & ILSLEY BANK
By: /s/ Thomas F. Bickelhaupt
------------------------------------
Thomas F. Bickelhaupt, Vice
President
FIRSTAR BANK MILWAUKEE, N.A.
By /s/ Caroline Krider, VP
-------------------------------------
Caroline Krider, Vice President
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