AMENDMENT NO. 9 TO
LOAN AND SECURITY AGREEMENT
AMENDMENT NO. 9, dated as of May 10, 1995 (this "AMENDMENT") to that
certain Loan and Security Agreement dated as of March 5, 1993, as amended by
Amendment Nos. 1, 2, 3, 4, 5, 6, 7 and 8 (collectively, the "LOAN AGREEMENT")
among THE PENN TRAFFIC COMPANY ("Penn Traffic"), DAIRY DELL, BIG M SUPERMARKETS,
INC. and PENNY CURTISS BAKING COMPANY, INC. (individually, each a "BORROWER" and
collectively, the "BORROWERS"), the Lenders listed therein (collectively, the
"LENDERS") and NATWEST USA CREDIT CORP., as Agent for the Lenders (in such
capacity, the "AGENT"), is made by, between and among the Borrowers, the Agent,
and the Lenders. Capitalized terms used herein, except as otherwise defined
herein, shall have the meanings given to such terms in the Loan Agreement.
WHEREAS, the Borrowers have requested that the Agent and the Lenders:
(1) increase the Maximum Revolving Credit Line; (2) change the advance rate with
respect to advances against Inventory and (3) make certain other amendments to
the Loan Agreement.
WHEREAS, the Borrowers, the Agent and the Lenders have agreed to amend
the Loan Agreement pursuant to the terms and conditions set forth herein.
NOW, THEREFORE, in consideration of the mutual promises, covenants and
agreements hereinafter set forth, the parties hereto agree as follows:
1. AMENDMENTS TO LOAN AGREEMENT. The Loan Agreement is hereby
amended as of the effective date hereof as follows:
(a) The definition of "BORROWING CAPACITY" in Section 1 of the Loan
Agreement is hereby amended by deleting the words "sixty percent (60%)" and
by substituting, in lieu thereof, the words "sixty-five percent (65%)."
(b) The definition of "MAXIMUM REVOLVING CREDIT LINE" in Section 1 of
the Loan Agreement is hereby amended to read as follows:
"MAXIMUM REVOLVING CREDIT LINE: means $250,000,000, or the lesser
amount to which the Borrowers have reduced the Maximum Revolving
Credit Line in accordance with Section 2.2(b)."
(c) The definition of "PENN TRAFFIC SUBORDINATED NOTES" in Section 1
of the Loan Agreement is hereby amended to read as follows:
"Penn Traffic Subordinated Notes" means the 9-5/8% Senior Subordinated
Notes of Penn Traffic due 2005 issued in connection with the Merger."
(d) The definition of "SENIOR NOTES" in Section 1 of the Loan
Agreement is hereby amended to read as follows:
"Senior Notes" means, collectively, the 11-1/2% Senior Notes of Penn
Traffic due 2001, the 10-1/4% Senior Notes of Penn Traffic due 2002,
the 8-5/8% Senior Notes of Penn Traffic due 2003, the 10-3/8% Senior
Notes of Penn Traffic due 2004, and the 10.65% Senior Notes of Penn
Traffic due 2004."
(e) The definition of "SUBORDINATED NOTES" in Section 1 of the Loan
Agreement is hereby amended to read as follows:
"Subordinated Notes' means the Penn Traffic Subordinated Notes."
(f) The definition of "TOTAL FACILITY" contained in Section 2.1 shall
be amended as follows: The first sentence of Section 2.1 is amended by
replacing the amount "$225,000,000" appearing in the first sentence thereof
with the amount "$250,000,000."
(g) Section 8.2(f) shall be amended by deleting the words "Prior to
the beginning of each Fiscal Year," and by substituting, in lieu thereof,
the words "Within thirty (30) days after the beginning of each Fiscal
Year,"
(h) Section 13.11 shall be amended by deleting the reference to
"Anderson Kill Olick & Oshinsky, P.C., 666 Third Avenue, New York, New York
10017, Attention: Melvin S. Slade, Esq." and by substituting, in lieu
thereof:
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"Kaye, Scholer, Fierman, Hays & Handler
425 Park Avenue
New York, New York 10022
Attention: Albert M. Fenster, Esq."
(i) The Commitments of the Lenders shall reflect the amounts and
percentages set forth on Schedule A to this Amendment.
2. INCREASED LINE FEE. In the event that Section 1(ii) becomes effective
the Borrowers jointly and severally agree to pay an Increased Line Fee to the
New Lender (as defined in Section 6(i) of this Amendment) in such amount as the
Borrowers and the New Lender shall agree.
3. REPRESENTATIONS AND WARRANTIES. As an inducement to the Agent and the
Lenders to enter into this Amendment, each of the Borrowers hereby represents
and warrants to the Agent and the Lenders and agrees with the Agent and the
Lenders as follows:
(1) It has the power and authority to enter into this Amendment and
has taken all corporate action required to authorize its execution,
delivery, and performance of this Amendment. This Amendment has been duly
executed and delivered by it and constitutes its valid and binding
obligation, enforceable against it in accordance with its terms. The
execution, delivery, and performance of this Amendment will not violate its
certificate of incorporation or by-laws or any agreement or legal
requirements binding upon it.
(2) As of the date hereof and after giving effect to the terms of
this Amendment: (i) the Loan Agreement is in full force and effect and
constitutes a binding obligation of the Borrowers, enforceable against the
Borrowers and owing in accordance with its terms; (ii) the Obligations are
due and owing by the Borrowers in accordance with their terms; and (iii)
Borrowers have no defense to or setoff, counterclaim, or claim against
payment of the Obligations and enforcement of the Loan Documents based upon
a fact or circumstance existing or occurring on or prior to the date
hereof.
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(3) The Obligations under the Loan Agreement as amended by this
Amendment constitute "Senior Indebtedness" as defined under the indentures
relating to the Senior Notes and to the Subordinated Notes.
4. NO IMPLIED AMENDMENTS. Except as expressly provided herein, the Loan
Agreement and the other Loan Documents are not amended or otherwise affected in
any way by this Amendment.
5. ENTIRE AGREEMENT; MODIFICATIONS; BINDING EFFECT. This Amendment
constitutes the entire agreement of the parties with respect to its subject
matter and supersedes all prior oral or written understandings about such
matter. Each of the Borrowers confirms that, in entering into this Amendment,
it did not rely upon any agreement, representation, or warranty by the Agent or
any Lender except those expressly set forth herein. No modification,
rescission, waiver, release, or amendment of any provision of this Amendment
may be made except by a written agreement signed by the parties hereto. The
provisions of this Amendment are binding upon and inure to the benefit of the
representatives, successors, and assigns of the parties hereto; provided,
however, that no interest herein or obligation hereunder may be assigned by
any Borrower without the prior written consent of the Required Lenders.
6. EFFECTIVE DATE. This Agreement shall become effective upon compliance
with the conditions set forth immediately below:
(a) The Agent has been able to obtain commitments in writing from one
or more Lenders or New Lenders (collectively, the "New Lender"),
aggregating $25,000,000 (provided that the minimum commitment of each New
Lender shall be no less than $10,000,000) and such New Lender shall agree
to be bound as a Lender under the Loan Agreement pursuant to an agreement
(the "New Lender Agreement") substantially in the form of Exhibit A
attached hereto.
(b) No Event or Event of Default shall have occurred and there shall
have been no material adverse change in the business or financial condition
of any of the Borrowers.
(c) The Borrowers shall deliver to the Agent for the benefit of the
Lenders an opinion of Borrowers'
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counsel in form and substance satisfactory to the Agent and its counsel
(which opinion shall cover such matters as the Agent may reasonably
request, including a statement that the Obligations under the Loan
Agreement as amended by this Amendment constitute "Senior Indebtedness" as
defined under the indentures relating to the Senior Notes and to the
Subordinated Notes).
(d) The Borrowers shall deliver to the Agent a certificate of the
Borrowers' Chief Executive or Chief Operating Officer with respect to
Section (ii) above and such other instruments and documents as the Agent or
any Lender shall reasonably request.
(e) The execution and delivery of (i) replacement Revolving Credit
Notes in the form of Exhibit C to the Loan Agreement in substitution for
the existing Revolving Credit Notes of the Lenders and reflecting the
Commitments of each Lender as set forth on Schedule A to this Amendment;
(ii) additional Revolving Credit Notes in the form of Exhibit C to the Loan
Agreement to the committing New Lender in the amount of $25,000,000 and
(iii) replacement Revolving Credit Notes from Dairy Dell in favor of each
of the Lenders (including the New Lender), such replacement Revolving
Credit Notes aggregating $500,000.
(f) The Agent shall have received an original counterpart of this
Amendment, duly executed and delivered by the Borrowers and all of the
Lenders.
(g) The Borrowers and the New Lender shall have agreed to an
Increased Line Fee as proposed in Section 2 of this Amendment.
7. COUNTERPARTS. This Amendment may be executed in any number of
counterparts, and by each party in separate counterparts, each of which is an
original, but all of which shall together constitute one and the same agreement.
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8. GOVERNING LAW. This Amendment is deemed to have been made in the State
of New York and is governed by and interpreted in accordance with the laws of
such state, provided that no doctrine of choice of law (except as may be
applicable under the UCC with respect to the Security Interest) shall be used to
apply the laws of any other state or jurisdiction.
IN WITNESS WHEREOF, the parties have entered into this Amendment as of
the date first above written.
BORROWERS:
THE PENN TRAFFIC COMPANY
By:/s/
-----------------------
Title:
DAIRY DELL
By:/s/
-----------------------
Title:
BIG M SUPERMARKETS, INC.
By:/s/
-----------------------
Title:
PENNY CURTISS BAKING
COMPANY, INC.
By:/s/
-----------------------
Title:
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LENDERS:
Commitment: $35,000,000 NATWEST USA CREDIT CORP.
Pro-Rata Share: 14%
Lending Office:
175 Water Street
New York, New York 10038 By:/s/
-----------------------
Title:
Commitment: $20,000,000 NATIONAL BANK OF CANADA
Pro-Rata Share: 8%
Lending Office:
Main Place Tower
Suite 2540
350 Main Street
Buffalo, New York 14202 By:/s/
-----------------------
Title:
Commitment: $20,000,000 FUJI BANK, LTD.
Pro-Rata Share: 8%
Lending Office:
Two World Trade Center
79th Fl.
New York, New York 10048 By:/s/
-----------------------
Title:
Commitment: $30,000,000 SANWA BUSINESS CREDIT
Pro-Rata Share: 12% CORPORATION
Lending Office:
One South Wacker Drive
Suite 2800
Chicago, IL 60606 By:/s/
-----------------------
Title:
Commitment: $30,000,000 BANKAMERICA
Pro-Rata Share: 12% BUSINESS CREDIT, INC.
Lending Office:
40 East 52nd Street
Second Fl.
New York, New York 10022 By:/s/
-----------------------
Title:
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Commitment: $25,000,000 HELLER FINANCIAL, INC.
Pro-Rata Share: 10%
Lending Office:
101 Park Avenue, 12th Fl.
New York, New York 10178 By:/s/
-----------------------
Title:
Commitment: $10,000,000 IBJ SCHRODER
Pro-Rata Share: 4% BANK & TRUST COMPANY
Lending Office:
One State Street
9th Fl.
New York, New York 10004 By:/s/
-----------------------
Title:
Commitment: $10,000,000 MIDLANTIC BANK N.A. (formerly
Pro-Rata Share: 4% known as Midlantic National
Lending Office: Bank)
499 Thornalle Street
9th Fl.
Edison, New Jersey 08837 By:/s/
-----------------------
Title:
Commitment: $30,000,000 MITSUBISHI TRUST AND
Pro-Rata Share: 12% BANKING CORPORATION
Lending Office:
520 Madison Avenue
25th Fl.
New York, NY 10022 By:/s/
-----------------------
Title:
Commitment: $15,000,000 INDUSTRIAL BANK OF JAPAN,
Pro-Rata Share: 6% LIMITED, New York Branch
Lending Office:
One State Street
9th Fl.
New York, New York 10004 By:/s/
-----------------------
Title:
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AGENT
NATWEST USA CREDIT CORP.,
As Agent
By:/s/
-----------------------
Title: