Exhibit 4.1
EXECUTION COPY
THIRD AMENDMENT
THIRD AMENDMENT, dated as of January 30, 2009
(this “ Amendment ”), to the Revolving Credit
Agreement, dated as of August 19, 2005 (as the same may be amended
(including pursuant to this Amendment), supplemented or otherwise
modified from time to time, the “ Credit Agreement
”), among SMITHFIELD FOODS, INC., a Virginia corporation (the
“ Borrower ”); each of the Subsidiaries of the
Borrower from time to time party to the Credit Agreement
(individually, a “ Subsidiary Guarantor ” and,
collectively, the “ Subsidiary Guarantors ” and,
together with the Borrower, the “ Obligors ”),
the lenders from time to time party to the Credit Agreement (the
“ Lenders ”), CALYON NEW YORK BRANCH,
COOPERATIEVE CENTRALE RAIFFEISEN-BOERENLEENBANK B.A.
“RABOBANK INTERNATIONAL”, NEW YORK BRANCH and SUNTRUST
BANK, as co-documentation agents (in such capacities, the
“Co-Documentation Agents”), CITICORP USA, INC., as
syndication agent (in such capacity, the “Syndication
Agent”) and JPMORGAN CHASE BANK, N.A., as administrative
agent (in such capacity, the “ Administrative Agent
”).
W I T N E S
S E T H :
WHEREAS, pursuant to the Credit Agreement, the
Lenders have agreed to make, and have made, certain loans and other
extensions of credit to the Borrower;
WHEREAS, the Borrower has requested certain
amendments to the Credit Agreement as more fully set forth herein;
and
WHEREAS, the Lenders have agreed to such
amendments but only on the terms and conditions contained in this
Amendment.
NOW, THEREFORE, the parties hereto hereby agree
as follows:
SECTION 1. Defined
Terms . Unless otherwise defined herein, terms
defined in the Credit Agreement and used herein shall have the
meanings given to them in the Credit Agreement.
SECTION 2. Amendments to
Section 1.01 of the Credit Agreement . The following
definitions set forth in Section 1.01 of the Credit Agreement shall
be amended and restated to read in their entirety as
follows:
“ Alternate Base Rate ”
means, for any day, a rate per annum (rounded upwards, if
necessary, to the next 1/16 th of
1%) equal to the greatest of (a) the Prime Rate in effect on such
day, (b) the Federal Funds Effective Rate for such day plus
0.50% and (c) the LIBO Quoted Rate for such day plus
1%. As used herein, the term “LIBO Quoted
Rate” means, for any day, the rate per annum determined
on the basis of the rate for deposits in Dollars for a one-month
interest period appearing on Page 3750 of the Telerate screen as of
11:00 a.m., London time, on such day (or if such day is not a
Business Day, on the immediately preceding Business Day).
Any change in the Alternate Base Rate due to a change
in the Prime Rate, the Federal Funds Effective Rate or the LIBO
Quoted Rate shall be effective from and including the effective
date of such change in the Prime Rate, the Federal Funds Effective
Rate or the LIBO Quoted Rate, respectively.
“ Applicable Rate ” means,
for any day, with respect to any ABR Loan, Eurocurrency Revolving
Loan, Letter of Credit, Swingline Loan, or with respect to the
Commitment Fees payable hereunder, as the case may be, the
applicable rate per annum set forth below for Loans of such Type,
for Letters of Credit or Commitment Fees, as the case may
be:
|
ABR Loans and
Swingline Loans
|
Eurocurrency Loans, and
Letters of Credit
|
Commitment
Fee
|
|
2.50%
|
3.50%
|
0.50%
|
“ Interest Period ” means,
with respect to any Eurocurrency Borrowing, the period commencing
on the date of such Borrowing and ending 14 days or on the
numerically corresponding day in the calendar month that is one,
two, three or six months thereafter, as the Borrower may elect;
provided , that (i) subject to clause (iv), if any Interest
Period would end on a day other than a Business Day, such Interest
Period shall be extended to the next succeeding Business Day unless
such next succeeding Business Day would fall in the next calendar
month, in which case such Interest Period shall end on the next
preceding Business Day, (ii) any Interest Period that commences on
the last Business Day of a calendar month (or on a day for which
there is no numerically corresponding day in the last calendar
month of such Interest Period) shall end on the last Business Day
of the last calendar month of such Interest Period, (iii) no
Interest Period shall extend beyond the Maturity Date and (iv) 14
day Interest Periods shall end on a Business Day and shall be
subject to other requirements to be specified by the Administrative
Agent. For purposes hereof, the date of a Borrowing
initially shall be the date on which such Borrowing is made and
thereafter shall be the effective date of the most recent
conversion or continuation of such Borrowing.
SECTION 3. Amendments to
Section 2.02(d) of the Credit Agreement . Section
2.02(d) of the Credit Agreement is hereby amended in its entirety
to read as follows:
“(d) Certain Limits on Interest
Periods. Notwithstanding any other provision of this
Agreement, the Borrower shall (1) not be entitled to request, or to
elect to convert or continue any Borrowing if the Interest Period
requested thereto would end after the Maturity Date or (2) not be
entitled to request, or to elect to convert or continue
Eurocurrency Loans with 14 day Interest Periods to the extent that,
after giving effect thereto, the aggregate principal amount of
Eurocurrency Loans with 14 day Interest Periods would exceed
$200,000,000.”
SECTION 4. Amendments to
Section 2.03(a) of the Credit Agreement. Section 2.03(a)
of the Credit Agreement is hereby amended by deleting clause (iii)
thereof and substituting in lieu thereof the following:
“(iii) in the case of an ABR
Borrowing, not later than 11:30 a.m., New York City time, on the
date of the proposed Borrowing.”
SECTION 5. Amendments to
Section 2.06(a) of the Credit Agreement. Section
2.06(a) of the Credit Agreement is hereby amended by deleting
“1:00 p.m.” and substituting in lieu thereof
“1:30 p.m.”.
SECTION 6. Amendments to
Section 6.12(b) of the Credit Agreement. Section 6.12(b)
of the Credit Agreement is hereby amended in its entirety to read
as follows:
“(b) Consolidated Interest
Coverage Ratio. The Borrower will not permit the ratio
of Consolidated EBITDA to Consolidated Interest Expense for any
period of four consecutive fiscal quarters of the Borrower ended on
the last day of each fiscal quarter set forth below to be less than
the ratio set forth opposite such fiscal quarter:
|
Fiscal Quarter Ending
|
Ratio
|
|
February 1, 2009
|
1.6 to 1
|
|
May 3, 2009
|
1.2 to 1
|
|
August 2, 2009
|
1.35 to 1
|
|
November 1, 2009
|
1.35 to 1
|
|
January 31, 2010
|
2.0 to 1
|
|
May 2, 2010 and
thereafter
|
3.0 to 1
|
SECTION 7. Amendments to
Section 6.12(c) of the Credit Agreement . Section
6.12(c) of the Credit Agreement is hereby amended and restated in
its entirety to read as follows:
“(c) Inventory and
Receivables. The Borrower will not, on any date on or
before the Security Termination Date, permit the ratio of (i) the
sum of 65% of the aggregate amount of Inventory plus 85% of the
aggregate amount of Accounts Receivable, in each case, of the
Borrower and the other Grantors (other than any Grantor that has
sold, conveyed or otherwise transferred Accounts Receivable in
connection with a Receivables Financing) subject to the Lien of the
Security Agreement (the sum of the foregoing amounts shall be
calculated based on the book value of Inventory and Accounts
Receivable, as applicable, in accordance with GAAP as set forth in
the financial statements delivered pursuant to Section 5.01(a) or
(b), as applicable, and shall apply, for purposes of determining
compliance with this Section, from the date such financial
statements are delivered until such sum is subsequently
redetermined as described herein) to (ii) the aggregate Revolving
Credit Exposure of all the Lenders under this Agreement and any
Pari Passu Debt, in either case at such date, to be less than 1.30
to 1 (the “ Coverage Covenant
”).”
SECTION 8. Amendments to
Section 1 of the Security Agreement . The definition
of “Guarantor Obligations” set forth in Section 1 of
the Security Agreement is hereby amended by inserting “and
all obligations in respect of purchase cards owed to any Lenders or
their Affiliates” after the phrase “automated
clearinghouse transfer funds” in clause (ii), and by
inserting “(it being agreed that all of the foregoing shall
cons
