AMENDMENT NO. 19 AND WAIVER TO
LOAN AND SECURITY AGREEMENT
AMENDMENT NO. 19, dated as of December 14, 1998 (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, 8, 9, 10, ll, 12, 13, 14, 15, 16, 17 and
18 (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 FLEET
BANK, N.A. (as successor to 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, pursuant to the terms of the Indenture for Penn Traffic's
85/8% Senior Unsecured Notes due December 15, 2003 (the "85/8% Indenture"),
interest in the amount of $8,625,000 is due and payable on December 15, 1998
(the "Interest Payment"), and the failure to make the Interest Payment becomes
an "Event of Default" under the 85/8% Indenture following a fifteen-day grace
period.
WHEREAS, the Borrowers have requested that the Agent and the Lenders
amend the Loan Agreement to agree as set forth in paragraph 1 below.
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. Amendment and Waiver to Loan Agreement. The failure of Penn
Traffic to pay the Interest Payment on or after December 15, 1998 (including
past the fifteen-day grace period) shall not, until April 1, 1998 (if such
failure is then continuing), constitute an Event or an Event of Default under
any provision of the Loan Agreement.
2. 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:
(a) 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
2
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.
(b) 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.
(c) The Obligations under the Loan Agreement as
amended by this Amendment constitute "Senior Indebtedness" and
"Designated Senior Indebtedness" as defined under the
indentures relating to the Senior Notes and to the
Subordinated Notes.
3. No Implied Amendments or Waivers. 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. Except for the specific
agreement set forth in Section 1, nothing herein shall be or be deemed to be a
waiver of any covenant or agreement contained in the Loan Agreement (or any
Event or Event of Default other than specified in Section 1 hereof) and each
Borrower hereby agrees that all of the covenants and agreements contained in the
Loan Agreement are hereby ratified and confirmed in all respects.
4. 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.
5. Effective Date. This Agreement shall become effective upon
compliance with the conditions set forth immediately below:
3
(i) Except for the matters specified in this
Amendment, 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.
(ii) The Borrowers shall deliver to the Agent for the
benefit of the Lenders an opinion of Borrowers' 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" and "Designated Senior
Indebtedness" as defined under the indentures relating to the
Senior Notes and to the Subordinated Notes).
(iii) The Borrowers shall deliver to the Agent a
certificate of the Borrowers' Chief Executive, Vice
Chairman-Finance or Chief Financial Officer with respect to
Section (i) above and such other instruments and documents as
the Agent shall reasonably request.
(iv) The Agent shall have received an original
counterpart of this Amendment, duly executed and delivered by
the Borrowers and the Required Lenders.
6. 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.
7. 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:______________________________
Title:
4
DAIRY DELL
By:______________________________
Title:
BIG M SUPERMARKETS, INC.
By:______________________________
Title:
PENNY CURTISS BAKING
COMPANY, INC.
By:______________________________
Title:
LENDERS:
Commitment: $35,000,000 FLEET BANK, N.A. (as successor to
Pro-Rata Share: 14% NatWest USA Credit Corp.)
Lending Office:
60 East 42nd Street
New York, New York 10017 By:______________________________
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:______________________________
Title:
Commitment: $10,000,000 TRANSAMERICA BUSINESS CREDIT
Pro-Rata Share: 4% CORP.
Lending Office:
555 Theodore Fremd Avenue
Suite C301
Rye, New York 10580 By:______________________________
Title:
5
Commitment: $30,000,000 SANWA BUSINESS CREDIT
Pro-Rata Share: 12% CORPORATION
Lending Office:
One South Wacker Drive
Suite 2800
Chicago, IL 60606 By:______________________________
Title:
Commitment: $45,000,000 BANKAMERICA BUSINESS CREDIT,
Pro-Rata Share: 18% INC.
Lending Office:
40 East 52nd Street
Second Fl.
New York, New York 10022 By:______________________________
Title:
Commitment: $50,000,000 HELLER FINANCIAL, INC.
Pro-Rata Share: 20%
Lending Office:
101 Park Avenue, 12th Fl.
New York, New York 10178 By:______________________________
Title:
Commitment: $10,000,000 LEHMAN COMMERCIAL PAPER,
Pro-Rata Share: 4% INC.
Lending Office:
3 World Financial Center
10th Fl.
New York, New York 10285 By:______________________________
Title:
Commitment: $10,000,000 AMSOUTH BANK
Pro-Rata Share: 4%
Lending Office:
350 Park Avenue
New York, New York 10022 By:______________________________
Title:
Commitment: $15,000,000 THE CIT GROUP/BUSINESS CREDIT,
Pro-Rata Share: 6% INC.
Lending Office:
300 South Grand Avenue
3rd Fl.
Los Angeles, CA 90071 By:______________________________
Title:
Commitment: $25,000,000 COMPAGNIE FINANCIERE DE CIC
Pro-Rata Share: 10% ET DE L'UNION EUROPEENNE
Lending Office:
520 Madison Avenue
37th Floor
New York, New York 10022 By:______________________________
Title:
6
AGENT:
FLEET BANK, N.A. (as Successors to
NatWest USA Credit Corp.),
As Agent
By:_______________________________
Title: