Interim Waiver Agreement between Imperial Sugar Company and Lender Parties to Amended and Restated Credit Agreement

Summary

Imperial Sugar Company and its lenders have entered into an Interim Waiver Agreement related to their existing Credit Agreement. The lenders agree to temporarily waive certain financial covenant defaults and audit report qualifications as of September 30, 2000, until the earlier of January 8, 2001, or a specified notice date. The agreement restricts the company's ability to make certain debt payments, prepayments, and credit utilizations, and sets conditions for ongoing negotiations about restructuring the credit terms. The waivers are temporary and will expire unless further extended by the lenders.

EX-4.1 2 0002.txt INTERIM WAIVER AGREEMENT EXHIBIT 4.1 IMPERIAL SUGAR COMPANY INTERIM WAIVER AGREEMENT To the Lender Parties to the Credit Agreement Identified Below Ladies and Gentlemen: We refer to the Amended and Restated Credit Agreement dated as of December 22, 1997 by and among Imperial Sugar Company (then known as Imperial Holly Corporation), the Lenders from time to time party thereto, Lehman Commercial Paper Inc. as Syndication Agent, Lehman Brothers Inc. as Arranger and Harris Trust and Savings Bank as Administrative and Collateral Agent, as heretofore or hereafter amended (the "Credit Agreement"), capitalized terms used without definition below to have the meanings ascribed to them in the Credit Agreement. Upon satisfaction of the conditions precedent to effectiveness set forth below, certain Defaults and/or Events of Default shall be waived, all on and subject to the conditions and limitations set forth below: 1. Interim Waivers with Respect to Certain Financial Covenants. Any Default or Event of Default occasioned solely by the failure of the Borrower to be in compliance with Section 7.1(a), 7.1(b), 7.1(e) or 7.1(f) of the Credit Agreement as of, but only as of, September 30, 2000 is hereby waived but only for the period to and including the earlier of (i) the Sub Debt Payment Notice Date and (ii) January 8, 2001 (the earlier of such dates being hereinafter referred to as the "Expiry Date") and effective on the Expiry Date such waivers shall be and become null and void and, absent a further waiver of such Defaults and/or Events of Default by the Required Banks such Defaults and Events of Default shall once again arise all as though the waivers provided for in this Section 1 had never been given. The term "Sub Debt Payment Notice Date" shall mean the date the Borrower serves a notice on the Administrative Agent pursuant to Section 3 hereof. 2. Audit Report Qualifications. Any Default or Event of Default occasioned solely by the consolidated audit report of the Borrower for the fiscal year ended September 30, 2000 containing a "going concern" or like qualification or exception is hereby waived. 3. Payments in Respect of Designated Subordinated Debt. The Borrower agrees that it will not make any payment of principal or interest on Designated Subordinated Debt or acquire or retire the same or make any deposit of funds or other property with the trustee for the holders of Designated Subordinated Debt for the purpose of funding any such payment, acquisition, or retirement unless the Requisite Lenders have agreed thereto or the Borrower shall have given the Administrative Agent not less than eight Business Days prior written notice (a "Sub Debt Payment Notice") of its intention so to do and confirmed that the Administrative Agent has actually received such notice at least eight Business Days prior to funding any such payment. The term "Designated Subordinated Debt" shall mean the Borrower's 9 3/4% senior subordinated notes due 2007 and issued under an indenture dated as of December 22, 1997 with The Bank of New York as original trustee. 4. No Prepayments. The Borrower will not and will not permit any Subsidiary to voluntarily prepay or acquire or retire any of the principal or interest on any Indebtedness (other than Indebtedness hereunder) prior to the time the same becomes due and payable. 5. Availability. In consideration of the waivers hereinabove provided, the Company has agreed to restrict utilizations under the Revolving Credit Commitments to amounts based upon its cash flow projections as heretofore presented to the Lenders. Accordingly, the Borrower hereby agrees that, anything contained in the Credit Agreement to the contrary notwithstanding, during each of the periods specified below Total Revolving Extensions of Credit shall not exceed the lesser of the Adjusted Revolving Credit Commitments or the amount specified below and the Borrower shall have no right to request a credit utilization if after giving effect thereto such credit utilizations would exceed such amounts: During the period Total Revolving Extensions of Credit shall not exceed following amounts plus current outstanding amount of letters of credit - ------------------------------------------------------------------------------- Effectiveness of this Agreement to 12/9/00 $ 85,000,000 - ------------------------------------------------------------------------------- 12/10/00 - 1/8/01 $125,000,000 - ------------------------------------------------------------------------------- 6. Interest Periods. Anything contained in the Credit Agreement to the contrary notwithstanding, the Borrower shall not be entitled to select new Interest Periods and Eurodollar Loans shall be converted into Base Rate Loans on the expiration of the Interest Periods currently applicable thereto. 7. Mandatory Prepayments. Anything contained in the Credit Agreement to the contrary notwithstanding, the proceeds of any mandatory prepayment made pursuant to Section 2.12 of the Credit Agreement shall be applied pro rata to the reduction of the Term Loans and the Revolving Credit Commitments and upon execution of counterparts hereof by the Majority Facility Lenders of the Tranche B Term Loans Section 2.18 (d) of the Credit Agreement shall be of no force or effect. 8. The Restructuring. The Borrower and certain of the Lenders holding 66 2/3% of the obligations of the Borrower under the Credit Agreement which also constitute a majority in number of the Lenders (the "Requisite Restructuring Lenders") have agreed to the Summary of Terms and Conditions for Refinancing or Restructuring of the Credit Agreement dated December 8, 2000 ("Restructuring Term Sheet") which is attached hereto and incorporated herein. The Borrower and such Lenders have agreed to all of the terms in the Restructuring Term Sheet with the following understanding: (a) the Borrower and Requisite Restructuring Lenders must further agree to the specific terms of (i) the financial covenants; (ii) the borrowing base and the definition of excess cash flow; and (iii) the permitted level of Capital Expenditures per year (which are to be justified to the Lenders by means of a Capital Expenditure Program) (collectively hereinafter referred to as "Implementation Issues"); (b) the Borrower and the Lenders have reserved their rights and do not agree on two specific pricing issues in the Restructuring Term Sheet; namely with regard to Pricing Grid, Annex 1A to the Restructuring Term Sheet, (i) whether there should be eurodollar pricing available at Level III and, if so, whether the pricing margin should be 4.75% per annum, and (ii) whether there should be a second Restructuring Fee in the amount of $1,550,000 payable upon the earlier of receipt of the Net Proceeds of an Equity Offering or one year anniversary of the Effective Date of the Plan of Reorganization for the Borrower (hereinafter collectively referred to as "Reserved Pricing Matters"). The Borrower, the Lenders and Agent will continue to negotiate the Implementation Issues and Reserved Pricing Matters in an effort to have them agreed to by the Borrower and the Requisite Restructuring Lenders The Borrower acknowledges and agrees that notwithstanding any terms or provisions of this Agreement or the Credit Agreement, the undersigned Lenders have not waived their right to receive and shall receive, and the Borrower agrees to pay, interest on the Loans and the obligations under the Credit Agreement and in respect of Letters of Credit on and after December 15, 2000, at the rate per annum applicable under Section 2.15 (d) of the Credit Agreement to amounts overdue (any notice or other actions by the Lenders necessary to accomplish this are hereby waived or deemed given by the Borrower). If the Implementation Issues and Reserved Pricing Matters have been resolved to the satisfaction of the Requisite Restructuring Lenders and the Agent by January 8, 2001 and the Borrower has received assurances from Holders of the 9 3/4% Senior Subordinated Notes Due 2007 of the Company ("Subordinated Notes") who in aggregate hold at least $140,000,000 principal amount of the Subordinated Notes ("Requisite Restructuring Noteholders") that the Requisite Restructuring Noteholders have agreed to the terms of the Restructuring Term Sheet by January 8, 2001 then the immediately preceding sentence shall be voided ab initio as if it had never been part of this Agreement. Interest in excess of that which would have accrued on the Loans but for this Agreement shall be due and payable on January 8, 2001 unless voided pursuant to the foregoing. The Borrower represents and warrants that it has received written assurances from representatives of Informal Committee of Subordinated Notes who hold collectively at least $140,000,000 principal amount of Subordinated Notes ("Committee") that each member of the Committee has approved the Restructuring Term Sheet subject to the Reserved Pricing Matters and the Implementation Issues. 9. Miscellaneous. Except as specifically modified hereby, all of the terms, conditions and provisions of the Credit Agreement shall stand and remain unchanged and in full force and effect. No reference to this Interim Waiver Agreement need be made in any instrument or document at any time referring to the Credit Agreement, a reference to the Credit Agreement in any of such to be deemed to be a reference to the same as modified hereby. This Interim Waiver Agreement may be executed in counterparts and by separate parties hereto on separate counterparts, each to constitute an original but all of which shall constitute one and the same instrument. The Borrower and the Subsidiary Guarantors hereby confirm that all representations and warranties made by them in the Loan Documents are true and correct as of the date hereof except to the extent that any of same expressly relate to any earlier date and acknowledge that their obligations under the Loan Documents are justly and truly owing without defense, offset or counterclaim. The waivers provided for herein shall be strictly construed and limited as hereinafter provided. This Interim Waiver Agreement shall become effective upon receipt by the Administrative Agent of counterparts hereof which, taken together, bear the signatures of the Borrower, the Guarantors, the Requisite Restructuring Lenders and the Majority Revolving Credit Facility Lenders, provided however that upon satisfaction of such conditions such effectiveness shall relate back to and be deemed effective as of September 30, 2000 all with the same force and effect as though such conditions precedent to effectiveness had been satisfied as of and on such date. This Interim Waiver Agreement shall be deemed to be a "Loan Document" for purposes of the Credit Agreement and the other Loan Documents. This Interim Waiver Agreement shall be construed in accordance with and governed by the laws of the state of New York. Dated and to become effective as of this 30th day of September 2000. IMPERIAL SUGAR COMPANY (formerly known as Imperial Holly Corporation) By /s/ Mark Q. Huggins ------------------------------------------- Its CFO ---------------------------------------- BIOMASS CORPORATION By: /s/ W. F. SCHWER ------------------------------------------- Name: W. F. SCHWER Title: President CROWN EXPRESS, INC. By: /s/ W. F. Schwer ------------------------------------------- Name: W. F. Schwer Title: President DIAMOND CRYSTAL BRANDS, INC. By: /s/ W. F. Schwer ------------------------------------------- Name: W. F. Schwer Title: Sr. Vice President DIAMOND CRYSTAL BRANDS, LP By: Savannah Molasses & Specialties Company Its sole General Partner By: /s/ W. F. Schwer ------------------------------------------- Name: W. F. Schwer Title: Sr. Vice President DIAMOND CRYSTAL HOLDINGS, INC. By: /s/ W. F. Schwer ---------------------------------- Name: W. F. Schwer Title: Sr. Vice President DIAMOND CRYSTAL SPECIALTY FOODS, INC. By: /s/ W. F. Schwer ---------------------------------- Name: W. F. Schwer Title: Sr. Vice President DIXIE CRYSTALS FOODSERVICE, INC. By: /s/ W. F. Schwer ---------------------------------- Name: W. F. Schwer Title: Sr. Vice President DSLT HOLDING COMPANY By: /s/ W. F. Schwer ---------------------------------- Name: W. F. Schwer Title: Sr. Vice President FOOD CARRIER, INC. By: /s/ W. F. Schwer ---------------------------------- Name: W. F. Schwer Title: Sr. Vice President FORT BEND UTILITIES COMPANY By: /s/ W. F. Schwer ---------------------------------- Name: W. F. Schwer Title: Sr. Vice President GREAT LAKES SUGAR COMPANY By: /s/ W. F. Schwer ---------------------------------- Name: W. F. Schwer Title: Sr. Vice President HOLLY NORTHWEST COMPANY By: /s/ W. F. Schwer ---------------------------------- Name: W. F. Schwer Title: President HOLLY SUGAR CORPORATION By: /s/ W. F. Schwer ---------------------------------- Name: W. F. Schwer Title: Sr. Vice President IMPERIAL DISTRIBUTING, INC. By: /s/ W. F. Schwer ---------------------------------- Name: W. F. Schwer Title: President IMPERIAL-SAVANNAH, LP By: Savannah Molasses & Specialties Company Its sole General Partner By: /s/ W. F. Schwer ---------------------------------- Name: W. F. Schwer Title: Sr. Vice President IMPERIAL SWEETENERS DISTRIBUTORS, INC. By: /s/ W. F. Schwer ---------------------------------- Name: W. F. Schwer Title: Sr. Vice President KING PACKAGING COMPANY, INC. By: /s/ W. F. Schwer ---------------------------------- Name: W. F. Schwer Title: Sr. Vice President LIMESTONE PRODUCTS COMPANY By: /s/ W. F. Schwer ---------------------------------- Name: W. F. Schwer Title: President MENU MAGIC FOODS, INC. By: /s/ W. F. Schwer ---------------------------------- Name: W. F. Schwer Title: Sr. Vice President MICHIGAN SUGAR COMPANY By: /s/ W. F. Schwer ---------------------------------- Name: W. F. Schwer Title: Sr. Vice President PHOENIX PACKAGING CORPORATION By: /s/ W. F. Schwer ---------------------------------- Name: W. F. Schwer Title: Sr. Vice President RAGUS HOLDINGS, INC. By: /s/ W. F. Schwer ---------------------------------- Name: W. F. Schwer Title: President SAVANNAH FOODS INDUSTRIAL, INC. By: /s/ W. F. Schwer ---------------------------------- Name: W. F. Schwer Title: Sr. Vice President SAVANNAH FOODS & INDUSTRIES, INC. By: /s/ W. F. Schwer ---------------------------------- Name: W. F. Schwer Title: Sr. Vice President SAVANNAH INVESTMENT COMPANY By: /s/ W. F. Schwer ---------------------------------- Name: W. F. Schwer Title: President SAVANNAH MOLASSES & SPECIALTIES COMPANY By: /s/ W. F. Schwer ---------------------------------- Name: W. F. Schwer Title: Sr. Vice President SAVANNAH SUGAR REFINING CORPORATION By: /s/ W. F. Schwer ---------------------------------- Name: W. F. Schwer Title: Sr. Vice President WHOLESOME SWEETENERS GROUP, LTD. By: Wholesome Sweeteners, LLC Its sole General Partner By: /s/ W. F. Schwer ---------------------------------- Name: W. F. Schwer Title: Manager WHOLESOME SWEETENERS, LLC By: /s/ W. F. Schwer ----------------------------------- Name: W. F. Schwer Title: Member Manager MONUMENT CAPITAL LTD. By: Alliance Capital Management L.P., as Investment Manager By: Alliance Capital Management Corporation, as General Partner By: /s/ Joel Serebransky ----------------------------------------- Name: Joel Serebransky Title: Senior Vice President OAK MOUNTAIN LIMITED By: Alliance Capital Management L.P., as Investment Manager By: Alliance Capital Management Corporation, as General Partner By: /s/ Joel Serebransky ----------------------------------------- Name: Joel Serebransky Title: Senior Vice President THE BANK OF NEW YORK By: /s/ Ronald R. Reedy ---------------------------------- Name: Ronald R. Reedy Title: Vice President BLACK DIAMOND CLO 1998--1 LTD. By: /s/ Debbie Boggess ---------------------------------- Name: Debbie Boggess Title: Director BLACK DIAMOND INTERNATIONAL FUNDING LTD. By: /s/ Debbie Boggess ---------------------------------- Name: Debbie Boggess Title: Director FARM CREDIT BANK OF WICHITA By: /s/ Travis W. Ball ----------------------------------- Name: Travis W. Ball Title: Assistant Vice President FIRST UNION NATIONAL BANK By: /s/ Thomas M. Cambern ----------------------------------- Name: Thomas M. Cambern Title: Senior Vice President LEHMAN COMMERCIAL PAPER INC., as Syndication Agent and as a Lender By: /s/ ---------------------------------- Name: Title: HARRIS TRUST AND SAVINGS BANK, as Administrative Agent, Collateral Agent, Issuing Lender and as a Lender By: /s/ Janet Maxwell-Wickett ---------------------------------- Name: Janet Maxwell-Wickett Title: Vice President LEHMAN COMMERCIAL PAPER INC., as Syndication Agent and as a Lender By: /s/ Michelle Swanson ---------------------------------- Name: Michelle Swanson Title: Authorized Signatory HARRIS TRUST AND SAVINGS BANK, as Administrative Agent, Collateral Agent, Issuing Lender and as a Lender By: ---------------------------------- Name: Title: COOPERATIEVE CENTRALE RAIFFEISEN- BOERENLEENBANK B.A., "RABOBANK NEDERLAND" NEW YORK BRANCH By: ---------------------------------- Name: Title: By: /s/ Stewart Kalish ---------------------------------- Name: Stewart Kalish Title: Vice President PILGRIM PRIME RATE TRUST By: Pilgrim Investments Inc. as its Investment Manager By: /s/ Michel Prince ---------------------------------- Name: Michel Prince, CFA Title: Vice President PILGRIM AMERICA HIGH INCOME INVESTMENTS, LTD. (as Assignee) By: /s/ Michel Prince ---------------------------------- Name: Michel Prince, CFA Title: Vice President SEQUILS-PILGRIM 1 LIMITED By: Pilgrim Investments Inc. as its Investment Manager By: ---------------------------------- Name: Title: PILGRIM CLO 1999--1 LIMITED By: Pilgrim Investments Inc. as its Investment Manager By: ---------------------------------- Name: Title: US BANCORP AG CREDIT, INC. By: /s/ Sandra A. Saver ---------------------------------- Name: Sandra A. Saver Title: Vice President WACHOVIA BANK, N.A. By: /s/ Richard H. Milhauk ---------------------------------- Name: Richard H. Milhauk Title: Senior Vice President VAN KAMPEN CLO I, LTD. By: Van Kampen Management Inc., as Collateral Manager By: /s/ Darvin D. Pierce ---------------------------------- Name: Darvin D. Pierce Title: Vice President VAN KAMPEN CLO II, LTD. By: Van Kampen Management Inc., as Collateral Manager By: /s/ Darvin D. Pierce ---------------------------------- Name: Darvin D. Pierce Title: Vice President VAN KAMPEN SENIOR INCOME TRUST By: /s/ Darvin D. Pierce ---------------------------------- Name: Darvin D. Pierce Title: Vice President FROST NATIONAL BANK By: /s/ Phil Dudley ---------------------------------- Name: Phil Dudley Title: Senior Vice President