DRAFT
Exhibit 99.1
THIRD AMENDMENT AND WAIVER TO
REVOLVING CREDIT AGREEMENT
This THIRD AMENDMENT AND WAIVER TO REVOLVING CREDIT AGREEMENT
dated as of May ___, 2005 (the "Third
Amendment"), is entered into by and among
INTERSTATE BAKERIES CORPORATION, a Delaware
corporation ("Parent Borrower"), a
debtor and debtor-in-possession in a case
pending under Chapter 11 of the
Bankruptcy Code, each of the direct and
indirect subsidiaries of the Parent
Borrower party to the Credit Agreement (as
defined below) (each individually a
"Subsidiary Borrower" and collectively the
"Subsidiary Borrowers"; and together
with the Parent Borrower, the "Borrowers"),
each of which is a debtor and
debtor-in-possession in a case pending
under Chapter 11 of the Bankruptcy Code,
JPMORGAN CHASE BANK, N.A., a national
banking association (formerly known as
JPMorgan Chase Bank) ("JPMCB"), and each of
the other commercial banks, finance
companies, insurance companies or other
financial institutions or funds from
time to time party to the Credit Agreement
(together with JPMCB, the
"Lenders"), JPMORGAN CHASE BANK, N.A., a
national banking association (formerly
known as JPMorgan Chase Bank), as
administrative agent (the "Administrative
Agent") for the Lenders, and JPMORGAN CHASE
BANK, N.A., a national banking
association (formerly known as JPMorgan
Chase Bank), as collateral agent (the
"Collateral Agent") for the Lenders.
WITNESSETH:
WHEREAS, the Borrowers, the Lenders, the Administrative Agent
and the Collateral Agent are parties to
that certain Revolving Credit Agreement
dated as of September 23, 2004 and as
amended by that certain First Amendment
to Revolving Credit Agreement dated as of
November 1, 2004 and by that certain
Second Amendment to Revolving Credit
Agreement dated as of January 20, 2005 (as
so amended, the "Credit Agreement"),
pursuant to which the Lenders have made
available to the Borrowers a revolving
credit and letter of credit facility in
an aggregate principal amount not to exceed
$200,000,000; and
WHEREAS, the Borrowers have requested that the Lenders waive
compliance with certain of the provisions
of the Credit Agreement and amend and
supplement the Credit Agreement to reflect
certain modifications to the Credit
Agreement; and
WHEREAS, the Required Lenders have agreed to waive compliance
with certain of the provisions of the
Credit Agreement and amend and supplement
the Credit Agreement to reflect certain
modifications to the Credit Agreement;
NOW, THEREFORE, in consideration of the premises and the
mutual agreements herein set forth and
other good and valuable consideration,
the receipt and sufficiency of which are
hereby acknowledged, the parties
hereto agree as follows:
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Section 1. Definitions. Capitalized terms used and not
otherwise defined in this Third Amendment
are used as defined in the Credit
Agreement.
Section 2. Amendments to Credit Agreement. Subject to the
conditions set forth in Section 4 hereof,
the Credit Agreement is hereby
amended as follows:
2.1 The definition of the term "Consolidated EBITDA" is
hereby amended in its entirety to read as
follows:
"Consolidated EBITDA" shall mean, for any period, all as
determined in accordance with GAAP and subject to such
modifications as may be satisfactory to the Administrative
Agent, the consolidated net income (or net loss) of the
Borrowers for such period, plus (a) the sum of (i)
depreciation expense, (ii) amortization expense, (iii) other
non-cash charges, (iv) net total Federal, state and local
income tax expense, (v) gross interest expense for such
period less gross interest income for such period, (vi)
extraordinary losses, (vii) any restructuring charge, and
(viii) "Chapter 11 expenses" (or "administrative costs
reflecting Chapter 11 expenses", inclusive of professional
fees) as shown on the Borrowers' consolidated statement of
income for such period, less (b) extraordinary gains.
2.2 Section 2.3(a) of the Credit Agreement is hereby amended
by replacing "$75,000,000" in clause (i)
thereof with "$125,000,000."
2.3 Section 2.13(b) of the Credit Agreement is hereby amended
by deleting the second sentence thereof and
substituting therefor the following
new sentence:
The Commitments shall be reduced on a pro rata basis by an
amount equal to the sum of (i) the Net Proceeds of the
subject Asset Sale required to be applied to repay the then
outstanding Loans pursuant to preceding sentence, plus (ii)
the Net Proceeds of the subject Asset Sale retained by the
Borrowers pursuant to the last clause of the preceding
sentence.
2.4 Section 6.4 of the Credit Agreement is hereby amended in
its entirety to read as follows:
Each of the Borrowers will not (and will not apply to the
Bankruptcy Court for authority to), and will cause each of
their respective Subsidiaries not to, make Capital
Expenditures during the fiscal periods of the Borrowers set
forth below, in an aggregate amount in excess of the amount
specified opposite such fiscal periods; provided that if the
amount of Capital Expenditures that are made during any such
fiscal period is less than the amount thereof that is
permitted to be made during such fiscal period, the unused
portion thereof may be carried forward to and made during the
subsequent fiscal periods:
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Maximum Capital
Fiscal Period
Expenditures
-------------
---------------
(millions)
May 29, 2005 - August 20, 2005
$20.0
August 21, 2005 - November 12, 2005
21.5
November 13, 2005 - March 4, 2006
19.0
March 5, 2006 - June 3, 2006
10.0
June 4, 2006 - August 26, 2006
14.0
August 27, 2006 - October 21, 2006
9.0
2.5 Section 6.5 of the Credit Agreement is hereby amended in
its entirety to read as follows:
As of the end of each fiscal period of the Borrowers,
commencing with the fiscal period beginning May 29, 2005, the
Borrowers will not permit cumulative Consolidated EBITDA for
each fiscal period beginning May 29, 2005 and ending in each
case on the last day of the fiscal period listed below to be
less than the respective amounts specified opposite such
fiscal period:
Cumulative
Fiscal Period Ending
Consolidated EBITDA
--------------------
-------------------
(millions)
June 25, 2005
$ 3.5
July 23, 2005
4.0
August 20, 2005
8.0
September 17, 2005
12.5
October 15, 2005
18.0
November 12, 2005
21.0
December 10, 2005
25.0
January 7, 2006
23.5
February 4, 2006
31.5
March 4, 2006
42.5
April 1, 2006
48.5
April 29, 2006
58.5
June 3, 2006
74.0
July 1, 2006
83.0
July 29, 2006
88.5
August 26, 2006
99.5
September 23, 2006
111.5
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DRAFT
2.6 Section 6 of the Credit Agreement is hereby amended by
inserting a new Section 6.17 as
follows:
SECTION 6.17 Cash Restructuring Charges. (a) Each of
the Borrowers will not (and will not apply to the Bankruptcy
Court for authority to), and will cause each of their
respective
Subsidiaries not to, permit cash restructuring
charges (calculated
